Registration No. 333-116220

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. 37

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

Amendment No. 271

(Check appropriate box or boxes)

Principal Life Insurance Company Separate Account B

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(Exact Name of Registrant)

Principal Life Insurance Company

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(Name of Depositor)

The Principal Financial Group, Des Moines, Iowa 50392

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(Address of Depositor's Principal Executive Offices) (Zip Code)

(515) 362-2384

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Depositor's Telephone Number, including Area Code

Doug Hodgson

The Principal Financial Group, Des Moines, Iowa 50392

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(Name and Address of Agent for Service)

Title of Securities Being Registered: Principal^®Investment Plus Variable Annuity Contract

It is proposed that this filing will become effective (check appropriate box)

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

_X__    on May 1, 2020 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

____    75 days after filing pursuant to paragraph (a)(2) of Rule 485

____    on (date) pursuant to paragraph (a)(2) of Rule 485

If appropriate, check the following box:

____    This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

PRINCIPAL^® INVESTMENT PLUS VARIABLE ANNUITY

(FOR APPLICATIONS SIGNED BEFORE AUGUST 1, 2013)

Prospectus dated May 1, 2020

The Company no longer offers or issues the Contract. This Prospectus is only for the use of the current Contract owners.

This prospectus describes Principal^® Investment Plus Variable Annuity, an individual, flexible premium, deferred variable annuity (the “Contract”), issued by Principal Life Insurance Company (“the Company”, “we”, “our” or “us”) through Principal Life Insurance Company Separate Account B (“Separate Account”).

This prospectus provides information about the Contract and the Separate Account that you , as owner , should know before investing. The prospectus should be read and retained for future reference. Additional information about the Contract and the Separate Account is included in the Statement of Additional Information (“SAI”), dated May 1, 2020, which has been filed with the Securities and Exchange Commission (the “SEC”) and is considered a part of this prospectus. The table of contents of the SAI is at the end of this prospectus. You may obtain a free copy of the SAI and all additional information by writing or calling: Principal ^® Investment Plus Variable Annuity, Principal Financial Group, P.O. Box 9382, Des Moines, Iowa 50306-9382, Telephone: 1-800-852-4450. You can also visit the SEC’s website at www.sec.gov, which contains the SAI, material incorporated into this prospectus by reference, and other information about registrants that file electronically with the SEC.

These securities have not been approved or disapproved by the SEC or any statesecurities commission nor has the SEC or any state securities commission passed uponthe accuracy or adequacy of this prospectus. Any representation to the contrary is acriminal offense.

You generally may allocate your investment in the Contract among the following investment options: dollar cost averaging fixed accounts (“DCA Plus accounts”), a Fixed Account and the Separate Account divisions. The DCA Plus accounts and the Fixed Account are a part of our General Account. Each division of the Separate Account invests in shares of a corresponding mutual fund (the “underlying mutual funds”). A list of the underlying mutual funds available under the Contract is shown below.

Youraccumulated value will vary according to the investment performance of the underlying mutual funds in which your selected division(s) are invested. We do not guarantee the investment performance of the underlying mutual funds.

For any administrative questions, you may contact us by writing or calling: Principal^® Investment Plus Variable Annuity, Principal Financial Group, P.O. Box 9382, Des Moines, Iowa 50306-9382, Telephone: 1-800-852-4450.

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the annual and semi-annual shareholder reports for underlying mutual funds available as investment options under your life insurance policy or annuity contract will no longer be sent by mail, unless you specifically request paper copies of the reports from the Company or from your financial intermediary. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive such reports electronically, you will not be affected by this change, and you do not need to take any action. If you have not previously elected electronic delivery, you may elect to receive reports and other communications from the Company electronically by following the instructions provided by the Company.

You may elect to receive all future reports in paper free of charge. If you wish to continue receiving paper copies of the reports, you can inform the Company by calling 1-800-247-9988 if you have a life insurance policy or 1-800-852-4450 if you have an annuity contract. Your election to receive reports in paper will apply to all underlying mutual funds available as investment options under your life insurance policy or annuity contract.

The Contract is available with or without the Premium Payment Credit Rider. This rider applies credits to the accumulated value for premium payments made in contract year one. The amount of the credit may be more than offset by the additional charges associated with it (higher surrender charges, a longer surrender charge period and increased annual expenses).A Contract without this rider will cost less. You should review your own circumstances to determine whether this rider is suitable for you.To assist you in making that determination, we have highlighted in grey boxes those portions of this prospectus pertaining to the rider.

NOTE: We recapture the premium payment credit if you return the Contract during the examination offer period or request full annuitization of the Contract prior to the third Contract anniversary. You take the risk that the recaptured amount may exceed the then current value of the credit(s). This risk occurs when yourinvestment options have experienced negative investment performance (i.e., have lost value) since the credit was applied. In that situation, you would be worse off than if you had not purchased the Premium Payment Credit Rider.

The Contract is available with or without a Guaranteed Minimum Withdrawal Benefit rider (GMWB). The GMWB riders currently available are Principal Income Builder 3 (“PIB 3”) and Principal Income Builder 10 (“PIB 10”). You may only elect one GMWB rider.

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SEPARATE ACCOUNT INVESTMENT OPTIONS

The following underlying mutual funds are available under the Contract⁽¹⁾:

AllianceBernstein Variable Products Series Fund — Class A	Janus Henderson Series — Service Shares
• AllianceBernstein Small Cap Growth Portfolio(2)	• Flexible Bond Portfolio
• AllianceBernstein Small/Mid Cap Value Portfolio	MFS — Service Class
American Century Variable Portfolios, Inc.	• International Intrinsic Value Portfolio
• Capital Appreciation Fund — Class I(3)	• New Discovery Series
• Inflation Protection Fund — Class II	• Utilities Series
• Mid Cap Value Fund — Class II	• Value Series
• Ultra Fund — Class II	Neuberger Berman Advisers Management Trust
American Funds Insurance Series — Class 2	• Mid Cap Growth Portfolio — S Class(5)
• Asset Allocation Fund	• Sustainable Equity Portfolio — I Class
• Blue Chip Income and Growth Fund	PIMCO Variable Insurance Trust
• Global Small Capitalization Fund	• All Asset Portfolio — Administrative Class
• New World Fund	• High Yield Portfolio — Administrative Class
BlackRock Variable Insurance Funds — Class III	• Low Duration Portfolio — Advisor Class
• 60/40 Target Allocation ETF V.I. Fund	• Total Return Portfolio — Administrative Class
• Global Allocation V.I. Fund	Principal Variable Contracts Funds — Class 1
BNY Mellon Investment Portfolios — Service Shares	• Core Plus Bond Account
• Technology Growth Portfolio	• Diversified International Account
Columbia VP — Class 2	• Equity Income Account
• Limited Duration Credit Fund	• Government & High Quality Bond Account
Delaware Variable Insurance Products — Service Class	• International Emerging Markets Account
• Limited Term Diversified Income Series	• LargeCap Growth Account I
• Small Cap Value	• LargeCap S&P 500 Index Account
DWS Variable Insurance Portfolio — Class B	• MidCap Account
• Small Mid Cap Value VIP	• Principal Capital Appreciation Division
EQ Advisors TrustSM  — Class IB	• Principal LifeTime 2010 Account(6)
• 1290 VT Convertible Securities Portfolio	• Principal LifeTime 2020 Account(6)
• 1290 VT GAMCO Small Company Value Portfolio	• Principal LifeTime 2030 Account(6)
• 1290 VT Micro Cap Portfolio	• Principal LifeTime 2040 Account(6)
• 1290 VT SmartBeta Equity Portfolio	• Principal LifeTime 2050 Account(6)
• 1290 VT Socially Responsible Portfolio	• Principal LifeTime Strategic Income Account(6)
Fidelity Variable Insurance Products	• Real Estate Securities Account
• Contrafund® Portfolio — Service Class 2	• Short-Term Income Account
• Equity-Income Portfolio — Service Class 2	• SmallCap Account
• Government Money Market Portfolio — Initial Class(4)	• Strategic Asset Management Balanced Account Portfolio(6)
• Growth Portfolio — Service Class 2	• Strategic Asset Management Conservative Balanced Portfolio(6)
• Mid Cap Portfolio — Service Class 2	• Strategic Asset Management Conservative Growth Portfolio(6)
• Overseas Portfolio — Service Class 2	• Strategic Asset Management Flexible Income Portfolio(6)
Franklin Templeton Variable Insurance Products Trust	• Strategic Asset Management Strategic Growth Portfolio(6)
• Franklin Global Real Estate VIP Fund — Class 2	Principal Variable Contracts Funds — Class 2
• Small Cap Value VIP Fund — Class 2	• Diversified Balanced Account(6)
• Templeton Global Bond VIP Fund — Class 4	• Diversified Balanced Managed Volatility Account(6)
Goldman Sachs Variable Insurance Trust — Institutional Shares	• Diversified Growth Account(6)
• MidCap Value Fund	• Diversified Growth Managed Volatility Account(6)
• Small Cap Equity Insights Fund	• Diversified Income Account(6)
Guggenheim Investments Variable Insurance Funds	Rydex Variable Insurance
• Series F (Guggenheim Floating Rate Strategies Series)	• Commodities Strategy Fund
• Global Managed Futures Strategy Fund	T. Rowe Price Equity Series, Inc. — II
• Long Short Equity Fund	• T. Rowe Price Blue Chip Growth Portfolio
• Multi-Hedge Strategies Fund	• T. Rowe Price Health Sciences Portfolio(7)
Invesco Variable Insurance Funds — Series I
• Health Care Fund
• International Growth Fund
• Small Cap Equity Fund
• Value Opportunities Fund

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Underlying mutual funds available under the Contract(1) (cont.)
TOPS® — Investor Class Shares(6)	VanEck VIP Global Insurance Trust— Class S Shares
• TOPS® Aggressive Growth ETF Portfolio	• Global Hard Assets Fund
• TOPS® Balanced ETF Portfolio
• TOPS® Conservative ETF Portfolio
• TOPS® Growth ETF Portfolio
• TOPS® Moderate Growth ETF Portfolio

⁽¹⁾  If you elect a GMWB rider, yourinvestment options for premium payments and accumulated value will be restricted (for restrictions see APPENDIX B).

⁽²⁾ Effective February 1, 2013, the AllianceBernstein Small Cap Growth Portfolio is no longer available to customers with an application signature date on or after February 1, 2013.

⁽³⁾ Effective May 18, 2013, the Capital Appreciation Fund is no longer available to customers with an application signature date on or after May 18, 2013.

⁽⁴⁾ All references to the Money Market Division in this prospectus will mean the Fidelity VIP Government Money Market Division.

⁽⁵⁾  The Neuberger Berman AMT Mid Cap Growth Portfolio is not available to customers with an application signature date on or after May 18, 2013.

⁽⁶⁾  This underlying mutual fund is a fund of funds. The fund of funds expenses may be higher than other fund types because the expenses of the selected fund include the expenses of the funds it holds.

⁽⁷⁾  Effective June 1, 2015, the T. Rowe Price Health Sciences Portfolio is no longer available to customers with an application signature date on or after June 1, 2015.

An investment in the Contract is not a deposit or obligation of any bank and is notinsured or guaranteed by any bank, the Federal Deposit Insurance Corporation or anyother government agency.

The Contract, certain Contract features and/or some of the investment options may not be available in all states or through all broker dealers. In addition, some optional features may restrict your ability to elect certain other optional features. For further details, please contact us at 1-800-852-4450.

Subject to state availability, if your Contract was purchased on or after May 20, 2006, you have the right to partially annuitize a portion of youraccumulated value.

This prospectus is valid only when accompanied by the current prospectuses for the underlying mutual funds. These prospectuses should be kept for future reference. This prospectus is not an offer to sell, or solicitation of an offer to buy, the Contract in states in which the offer or solicitation may not be lawfully made. No person is authorized to give any information or to make any representation in connection with this Contract other than those contained in this prospectus.

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TABLE OF CONTENTS

SEPARATE ACCOUNT INVESTMENT OPTIONS	2
GLOSSARY	8
SUMMARY OF EXPENSE INFORMATION	10
SUMMARY	14
1. THE CONTRACT	17
How To Buy a Contract	17
Premium Payments	18
Allocating Premium Payments	18
Principal® Variable Annuity Exchange Offer (“exchange offer”)	19
Investment Plus Variable Annuity GMWB Exchange Offer	19
Exchange Credit (for exchanges from our fixed deferred annuities)	19
Right to Examine the Contract (free look)	20
Accumulated Value	20
Telephone and Internet Services	21
2. CHARGES AND DEDUCTIONS	22
Surrender Charge	22
Free Surrender Amount	24
When Surrender Charges Do Not Apply	24
Waiver of Surrender Charge Rider	24
Transaction Fee	24
Premium Taxes	25
Annual Fee	25
Separate Account Annual Expenses	25
Mortality and Expense Risks Charge	25
Administration Charge	25
Premium Payment Credit Rider	26
Charges for Rider Benefits Currently Available	26
Principal Income Builder 3 (PIB 3) Rider	26
Principal Income Builder 10 (PIB 10) Rider	27
Charges for Rider Benefits No Longer Available	27
Enhanced Death Benefit Rider	27
GMWB 1 Rider – Investment Protector Plus	27
GMWB 2-SL (Single Life) Rider – Investment Protector Plus 2	27
GMWB 2-SL/JL (Single Life/Joint Life) Rider – Investment Protector Plus 2	27
Special Provisions for Group or Sponsored Arrangements	28
3. FIXED ACCOUNT AND DCA PLUS ACCOUNTS	28
Fixed Account	28
Fixed Account Value	29
Dollar Cost Averaging Plus Program (DCA Plus Program)	29

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4. LIVING BENEFIT – GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB) – APPLICATIONS SIGNED BEFORE AUGUST 1, 2013	30
GMWB Rider Restrictions/Limitations	30
GMWB Investment Options	31
Principal Income Builder 3 – This versionno longer available effective August 1, 2013
Overview	31
Withdrawal Benefit Base	32
Withdrawal Benefit Payment	32
Covered Life Change	34
Effect of Withdrawals	35
Excess Withdrawals	35
Required Minimum Distribution (RMD) Program for GMWB Riders	36
GMWB Bonus	36
GMWB Step-Up	37
Effect of Reaching the Maximum Annuitization Date	37
Effect of the Contract Accumulated Value Reaching Zero	38
Upon Death	38
Termination and Reinstatement	40
Spousal Continuation	40
Effect of Divorce	42
Principal Income Builder 10 - This versionno longer available effective August 1, 2013
Overview	44
Withdrawal Options	45
Withdrawal Benefit Base	45
Remaining Withdrawal Benefit Base	45
Withdrawal Benefit Payments	46
Covered Life Change	47
Effect of Withdrawals	48
Excess Withdrawals	49
Required Minimum Distribution (RMD) Program for GMWB Riders	49
GMWB Bonus	50
GMWB Step-Up	50
Effect of Reaching the Maximum Annuitization Date	51
Effect of the Contract Accumulated Value Reaching Zero	52
Upon Death	53
Termination and Reinstatement	55
Spousal Continuation	56
Effect of Divorce	58
5. PREMIUM PAYMENT CREDIT RIDER	60

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6. TRANSFERS AND SURRENDERS	61
Division Transfers	61
Unscheduled Transfers	62
Scheduled Transfers (Dollar Cost Averaging)	62
Fixed Account Transfers, Total and Partial Surrenders	63
Automatic Portfolio Rebalancing (APR)	63
Surrenders	64
Total Surrender	64
Unscheduled Partial Surrender	64
Scheduled Partial Surrender	64
7. THE ANNUITIZATION PERIOD	65
Annuitization Date	65
Full Annuitization	65
Partial Annuitization	65
Annuity Benefit Payment Options	65
Tax Considerations Regarding Annuity Benefit Payment Options	67
8. DEATH BENEFIT	67
Death of Annuitant (During the Annuitization Period)	68
Standard Death Benefit Formula	68
Enhanced Death Benefit	68
Payment of Death Benefit	69
9. ADDITIONAL INFORMATION ABOUT THE CONTRACT	69
The Contract	69
Delay of Payments	69
Misstatement of Age or Gender	69
Assignment	70
Change of Owner or Annuitant	70
Beneficiary	70
Contract Termination	70
Reinstatement	70
Reports	71
Important Information About Customer Identification Procedures	71
Frequent Trading and Market-Timing (Abusive Trading Practices)	71
Distribution of the Contract	72
Performance Calculation	73
10. FEDERAL TAX MATTERS	73
Taxation of Non-Qualified Contracts	73
Taxation of Qualified Contracts	75
Withholding	76

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11. GENERAL INFORMATION ABOUT THE COMPANY	77
Corporate Organization and Operation	77
Legal Opinions	78
Legal Proceedings	78
Other Variable Annuity Contracts	78
Payments to Financial Intermediaries	79
Conflicts of Interest Related to Underlying Mutual Funds	79
Mutual Fund Diversification	80
State Regulation	80
Independent Registered Public Accounting Firm	80
Financial Statements	80
12. TABLE OF SEPARATE ACCOUNT DIVISIONS	81
13. REGISTRATION STATEMENT	97
14. TABLE OF CONTENTS OF THE SAI	97
APPENDIX A — PRINCIPAL® VARIABLE ANNUITY EXCHANGE OFFER	98
APPENDIX A-2 — INVESTMENT PLUS VARIABLE ANNUITY GMWB EXCHANGE OFFER	99
APPENDIX B — GMWB INVESTMENT OPTIONS	108
APPENDIX C — PRINCIPAL INCOME BUILDER 3 EXAMPLES	111
APPENDIX D — PRINCIPAL INCOME BUILDER 10 EXAMPLES	115
APPENDIX E — GMWB 2-SL/JL (NO LONGER AVAILABLE FOR SALE)	124
APPENDIX F — GMWB 2-SL (NO LONGER AVAILABLE FOR SALE)	150
APPENDIX G — GMWB 1 (NO LONGER AVAILABLE FOR SALE)	169
APPENDIX H — ENHANCED DEATH BENEFIT RIDER (NO LONGER AVAILABLE FOR SALE)	187
APPENDIX I — CONDENSED FINANCIAL INFORMATION	193

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GLOSSARY

accumulated value – the sum of the values in the DCA Plus Account(s), the Fixed Account and the Separate Account divisions.

anniversary(ies) – the same date and month of each year following the contract date .

annuitant – the person, including any jointannuitant, on whose life the annuity benefit payment is based. This person may or may not be the owner.

annuitization – application of a portion or all of the accumulated value to an annuity benefit payment option to make income payments.

annuitization date – the date all of the owner’saccumulated value is applied to an annuity benefit payment option.

Automatic Portfolio Rebalancing (APR) – the transfer of money among yourSeparate Account divisions on a set schedule to maintain a specified percentage in each Separate Account division.

cash surrender value – the accumulated value minus any applicable surrender charges and fee(s) (contract fee and/or prorated share of the charge(s) for optional rider(s)).

contract date – the date that the Contract is issued and which is used to determine contract years.

contract year – the one-year period beginning on the contract date and ending one day before the contract anniversary and any subsequent one-year period beginning on a contract anniversary (for example, if the contract date is June 5, 2013, the first contract year ends on June 4, 2014, and the first contract anniversary falls on June 5, 2014).

data page – that portion of the Contract which contains the following: owner and annuitant data (names, gender, annuitant age); the Contract issue date; maximum annuitization date; Contract charges and limits; benefits; and a summary of any optional benefits chosen by the Contract owner.

Dollar Cost Averaging Plus (DCA Plus) account – an account which uses a guaranteed interest rate to calculate interest earned for a specific amount of time.

Dollar Cost Averaging Plus (DCA Plus) value – the amount invested in the DCA Plus Account(s) (plus interest earned and less any surrenders and/or transfers).

Dollar Cost Averaging Plus (DCA Plus) program – a program through which yourDCA Plus value is transferred from a DCA Plus Account to the investment options over a specified period of time.

Fixed Account – an account which uses a guaranteed interest rate to calculate interest earned.

Fixed Account value – the amount invested in the Fixed Account (plus interest earned and less any surrenders and/or transfers).

good order – an instruction or request is in good order when it is received in ourhome office, or other place we may specify, and has such clarity and completeness that we do not have to exercise any discretion to carry out the instruction or request. We may require that the instruction or request be given in a certain form.

home office – Company’s corporate headquarters located at Principal Financial Group, Des Moines, Iowa 50392-1770.

investment options – the DCA Plus Accounts, Fixed Account and Separate Account divisions.

joint annuitant – an annuitant whose life determines the annuity benefit under this Contract. Any reference to the death of the annuitant means the death of the first annuitant to die.

joint owner – an owner who has an undivided interest with the right of survivorship in this Contract with another owner. Any reference to the death of the owner means the death of the first owner to die.

non-qualified contract – a Contract which does not qualify for favorable tax treatment as a Qualified Plan, Individual Retirement Annuity, Roth IRA, SEP IRA, Simple-IRA or Tax Sheltered Annuity.

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notice – any form of communication received by us, at the home office, either in writing or in another form approved by us in advance.

Yournotices may be mailed to us at:

Principal Life Insurance Company

P O Box 9382

Des Moines, Iowa 50306-9382

owner – the person, including joint owner, who owns all the rights and privileges of this Contract. For the Principal^® Variable Annuity Exchange Offer, owner refers to the original owner.

premium payments – the gross amount you contributed to the Contract.

qualified plans – retirement plans which receive favorable tax treatment under Section 401 or 403(a) of the Internal Revenue Code.

Required Minimum Distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions.

Separate Account division (division(s)) – a part of the Separate Account which invests in shares of an underlying mutual fund. (Referred to in the marketing materials as “sub-accounts.”)

Separate Account division value – the sum of all divisions’ value; each division’s value is determined by multiplying the number of units in that division by the unitvalue of that division.

surrender - the withdrawal of all or part of the accumulated value of your Contract.

surrender charge – the charge deducted upon certain partial surrenders or total surrender of the Contract before the annuitization date.

surrender value – accumulated value less any applicable surrender charge, rider fees, annual fee, transaction fees and any premium tax or other taxes.

transfer – moving all or a portion of youraccumulated value to or from one investment option or among several investment options. All transfers initiated during the same valuation period are considered to be one transfer for purposes of calculating the transaction fee, if any.

underlying mutual fund – a registered open-end investment company, or a series or portfolio thereof, in which a division invests.

unit – the accounting measure used to determine your proportionate interest in a division.

unit value – a measure used to determine the value of an investment in a division.

valuation date (valuation days) – each day the New York Stock Exchange (“NYSE”) is open for trading and trading is not restricted.

valuation period – the period of time from one determination of the value of a unit of a division to the next. Each valuation period begins at the close of normal trading on the NYSE, generally 4:00 p.m. Eastern Time, on each valuation date and ends at the close of normal trading of the NYSE on the next valuation date.

we, our, us – Principal Life Insurance Company. We are also referred to throughout this prospectus as the Company.

you, your – the owner of this Contract, including any joint owner.

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SUMMARY OF EXPENSE INFORMATION

The tables below describe the fees and expenses that you will pay when buying, owning and surrendering the Contract. The expenses for a Contract with the Premium Payment Credit Rider are higher than the expenses for the Contract without the Premium Payment Credit Rider.

The following table describes the fees and expenses you will pay at the time you buy the Contract, surrender the Contract or transfer cash value between investment options.

Contract owner transaction expenses(1)
	Maximum	Current
Surrender charge - with the Premium Payment Credit Rider (as a percentage of amount surrendered)(2) - Surrender charges apply to each premium payment for 9 years.	• 8%	• 8%
Surrender charge - without the Premium Payment Credit Rider (as a percentage of amount surrendered)(3) - Surrender charges apply to each premium payment for 7 years.	•    6%	•    6%
Transaction Fees •    for each unscheduled partial surrender	•    the lesser of $25 or 2% of each unscheduled partial surrender after the 12th unscheduled partial surrender in a contract year	•    $0
•    for each unscheduled transfer(4)	•    the lesser of $30 or 2% of each unscheduled transfer after the first unscheduled transfer in a contract year	•    $0
State Premium Taxes (vary by state)(5)	•    3.50% of premium payments made	•    0%

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The following table describes the fees and expenses that are deducted periodically during the time that you own the Contract, not including underlying mutual fund fees and expenses.

Periodic Expenses
	Maximum Annual Charge	Current Annual Charge
Annual Fee (waived for Contracts with accumulated value of $30,000 or more)	The lesser of $30 or 2.00% of the accumulated value	The lesser of $30 or 2.00% of the accumulated value
Mortality and Expense Risks Charge (as a percentage of average daily Separate Account value)	1.25%	1.25%
Administration Charge (as a percentage of average daily Separate Accountvalue)	0.15%	0.15%
Total Separate Account Annual Expense	1.40%	1.40%
Optional Riders(6)
	Maximum Annual Charge	Current Annual Charge
Premium Payment Credit Rider • Separate Account – based on the average daily accumulated value in the divisions, deducted daily • Fixed Account – maximum reduction in interest rate	0.60% 0.60%	0.60% 0.00%
Principal Income Builder 3 rider (GMWB) (as a percentage of the average quarterly For Life withdrawal benefit base)(7) • for applications signed before August 1, 2013	1.65%	0.95%
Principal Income Builder 10 rider (GMWB) (as a percentage of the average quarterly Investment Back withdrawal benefit base)(8) • for applications signed before August 1, 2013	2.00%	1.10%
Total Separate Account Annual Expense plus Optional Riders Annual Expense • with Principal Income Builder 3(9) – for applications signed before August 1, 2013 • with Principal Income Builder 10(10) – for applications signed before August 1, 2013	3.65% 4.00%	2.95% 3.10%

Optional Riders No Longer Available For Sale
	Maximum Annual Charge	Current Annual Charge
Enhanced Death Benefit Rider (as a percentage of the average quarterly accumulated value)(11)	0.30%	0.25%
GMWB 1 Rider (as a percentage of the average quarterly Investment Back remaining withdrawal benefit base)(12)	0.85%	0.80%(13)
GMWB 2-SL Rider (as a percentage of the average quarterly Investment Back withdrawal benefit base)(14)	1.00%	0.95%(15)
GMWB 2-SL/JL Rider (as a percentage of the average quarterly Investment Back withdrawal benefit base)(14)	1.65%(16)	0.95%(17)

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This table shows the minimum and maximum total operating expenses charged by the underlying mutual funds that you may pay periodically during the time that you own the Contract. More detail concerning the fees and expenses of each underlying mutual fund is contained in its prospectus.

Minimum and Maximum Annual Underlying Mutual Fund Operating Expenses as of December 31, 2019
	Minimum	Maximum
Total annual underlying mutual fund operating expenses (expenses that are deducted from underlying mutual fund assets, including management fees, distribution and/or service (12b-1) fees and other expenses)*	0.25%	2.10%

* Some of the funds available are structured as a “fund of funds”. A fund of funds is a mutual fund that invests primarily in a portfolio of other mutual funds. The expenses shown include all the fees and expenses of the funds that a fund of funds holds in its portfolio.

⁽¹⁾  For additional information about the fees and expenses described in the table, see 2. CHARGES ANDDEDUCTIONS.

⁽²⁾  Surrender charge with the Premium Payment Credit Rider (as a percentage of amounts surrendered)

Table of surrender charges with the Premium Payment Credit Rider
Number of completed contract years since each premium payment was made	Surrender charge applied to all premium payments received in that contract year
0 (year of premium payment)	8%
1	8%
2	7%
3	6%
4	5%
5	4%
6	3%
7	2%
8	1%
9 and later	0%

⁽³⁾  Surrender charge without the Premium Payment Credit Rider (as a percentage of amounts surrendered):

Table of surrender charges without the Premium Payment Credit Rider
Number of completed contract years since each premium payment was made	Surrender charge applied to all premium payments received in that contract year
0 (year of premium payment)	6%
1	6%
2	6%
3	5%
4	4%
5	3%
6	2%
7 and later	0%

⁽⁴⁾  Please note that in addition to the fees shown, the Separate Account and/or sponsors of the underlying mutual funds may adopt requirements pursuant to rules and/or regulations adopted by federal and/or state regulators which require us to collect additional transaction fees and/or impose restrictions on transfers.

⁽⁵⁾  We do not currently assess premium taxes for any Contract issued, but reserve the right in the future to assess up to 3.50% of premium payments made for Contract owners in those states where a premium tax is assessed.

⁽⁶⁾  Not all riders are available in all states or through all broker dealers and may be subject to additional restrictions. Some rider provisions may vary from state to state.

⁽⁷⁾  At the end of each calendar quarter, one-fourth of the annual charge is multiplied by the average quarterly For Life withdrawal benefit base. The average quarterly For Life withdrawal benefit base is equal to (1) the For Life withdrawal benefit base at the beginning of the calendar quarter plus (2) the For Life withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. There may be times when the sum of the four quarterly fee amounts is higher than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters. See 2. CHARGES AND DEDUCTIONS for more information on how the rider charge is calculated.

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⁽⁸⁾  At the end of each calendar quarter, one-fourth of the annual charge is multiplied by the average quarterly Investment Back withdrawal benefit base. The average quarterly Investment Back withdrawal benefit base is equal to (1) the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus (2) the Investment Back withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. There may be times when the sum of the four quarterly fee amounts is higher than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters. See 2. CHARGES AND DEDUCTIONS for more information on how the rider charge is calculated.

⁽⁹⁾   This amount assumes the Principal Income Builder 3 rider was elected (in addition to the 1.25% Mortality and Expense Risks Charge and the 0.15% Administration Charge). This assumes the withdrawal benefit base is equal to the initial premium payment. If the withdrawal benefit base changes, the charge for your optional rider and your Total Separate Account Annual Expense would be higher or lower.

⁽¹⁰⁾   This amount assumes the Principal Income Builder 10 rider was elected (in addition to the 1.25% Mortality and Expense Risks Charge and the 0.15% Administration Charge). This assumes the withdrawal benefit base is equal to the initial premium payment. If the withdrawal benefit base changes, the charge for your optional rider and your Total Separate Account Annual Expense would be higher or lower.

⁽¹¹⁾   This rider is no longer available for sale. For those Contracts with this rider, at the end of each calendar quarter, one-fourth of the annual charge is multiplied by the average quarterly accumulated value. The average quarterly accumulated value is equal to (1) the accumulated value at the beginning of the calendar quarter plus (2) the accumulated value at the end of the calendar quarter, and this sum is divided by two. See 2. CHARGES AND DEDUCTIONS for more information on how the rider charge is calculated. See APPENDIX H for additional information.

⁽¹²⁾  This rider is no longer available for sale. For those Contracts with this rider, at the end of each calendar quarter, one-fourth of the annual charge is multiplied by the average quarterly Investment Back remaining withdrawal benefit base. The average quarterly Investment Back remaining withdrawal benefit base is equal to (1) the Investment Back remaining withdrawal benefit base at the beginning of the calendar quarter plus (2) the Investment Back remaining withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. See APPENDIX G for more information on how the rider charge is calculated. There may be times when the sum of the four quarterly fee amounts is higher than the fee amount if we calculated it annually. For example, if your remaining withdrawal benefit base is changed, the fee for that calendar quarter will vary from the other quarters.

⁽¹³⁾  A 0.60% annual charge is assessed if the rider application was signed before February 16, 2009 and no GMWB Step-Up has occurred. A 0.80% annual charge is assessed if the rider application was signed before February 16, 2009 and a GMWB Step-Up has occurred. If the rider application was signed after February 16, 2009, the annual fee is 0.80%.

⁽¹⁴⁾  At the end of each calendar quarter, one-fourth of the annual charge is multiplied by the average quarterly Investment Back withdrawal benefit base. The average quarterly Investment Back withdrawal benefit base is equal to (1) the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus (2) the Investment Back withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. There may be times when the sum of the four quarterly fee amounts is higher than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters. ForGMWB 2-SL, see APPENDIX F and for GMWB 2-SL/JL,see APPENDIX E for more information on how the rider charge is calculated.

⁽¹⁵⁾  The current annual charge prior to your Contract's 2010 anniversary or if you opt out of future GMWB Step-Ups is 0.75%. See APPENDIX E for more details.

⁽¹⁶⁾   The maximum annual charge for a rider application signed before January 4, 2010 is 1.00%.

⁽¹⁷⁾  A 0.75% annual charge is assessed if the rider application was signed before February 16, 2009 and you opt out of future GMWB Step-Ups after the Contract's 2010 anniversary. A 0.95% annual charge is assessed if (1) the rider application was signed before February 16, 2009 and you do not opt out of future GMWB Step-Ups after the Contract's 2010 anniversary or (2) the rider application was signed on or after February 16, 2009. See APPENDIX E for more details.

EXAMPLE

These examples are intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include Contract owner transaction expenses, Contract fees, Separate Account annual expenses, and underlying mutual fund fees and expenses.

Example 1

The example figures are based on a Contract with the most expensive combination of optional features available under the Contract. This example reflects the maximum charges imposed if you were to purchase the Contract with the Principal Income Builder 10 rider (2.00%), as well as the Premium Payment Credit Rider (0.60%). The amounts below are calculated using the maximum rider fees and not the current rider fees.

The example assumes⁽¹⁾:

• a $10,000 premium payment to issue the Contract;

• a 5% return each year;

• an annual Contract fee of $30 (expressed as a percentage of the average accumulated value);

• the minimum and maximum annual underlying mutual fund operating expenses as of December 31, 2019 (without voluntary waivers of fees by the underlying funds, if any);

• no premium taxes are deducted;

• the Principal Income Builder 10 rider was added to the Contract at issue⁽²⁾; and

• the Premium Payment Credit Rider is added to the Contract at issue and the Premium Payment Credit Rider surrender charge schedule is applied. Because the premium payment credit is not added to the accumulated value in the examples, the actual costs would be higher.

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Although your actual costs may be higher or lower, based on these assumptions, your costs would be as shown below:

	If you surrender your Contract at the end of the  applicable time period				If you do not surrender your Contract				If you fully annuitize your Contract at the end of the applicable time period
	1 Yr.	3 Yrs.	5 Yrs.	10 Yrs.	1 Yr.	3 Yrs.	5 Yrs.	10 Yrs.	1 Yr.	3 Yrs.	5 Yrs.	10 Yrs.
Maximum Total Underlying Mutual Fund Operating Expenses (2.10%)	$1,311	$2,417	$3,460	$6,076	$600	$1,812	$3,043	$6,076	$600	$1,812	$3,043	$6,076
Minimum Total Underlying Mutual Fund Operating Expenses (0.25%)	$1,146	$1,934	$2,670	$4,560	$420	$1,290	$2,206	$4,560	$420	$1,290	$2,206	$4,560

⁽¹⁾  This amount assumes the Principal Income Builder 10 rider was elected (in addition to the 1.25% Mortality and Expense Risks Charge and the 0.15% Administration Charge). This assumes the withdrawal benefit base is equal to the initial premium payment. If the withdrawal benefit base changes, the charge for your optional rider and your Total Separate Account Annual Expense would be higher or lower.

⁽²⁾  The Investment Back withdrawal benefit base is used to calculate the Principal Income Builder 10 rider charge. The withdrawal benefit base is equal to your premiums and increased for any applicable GMWB Bonus and any applicable GMWB Step-Up and decreased for any excess withdrawals. At the end of each calendar quarter, one-fourth of the annual Principal Income Builder 10 rider charge is multiplied by the average quarterly Investment Back withdrawal benefit base. The average quarterly Investment Back withdrawal benefit base is equal to the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back withdrawal benefit base at the end of the calendar quarter and the sum is divided by two.

For Condensed Financial Information, please see Appendix I.

SUMMARY

This prospectus describes an individual flexible premium deferred variable annuity offered by the Company. The Contract is designed to provide individuals with retirement benefits, including:

• non-qualified retirement programs; and

• Individual Retirement Annuities (“IRA”), Simplified Employee Pension plans (“SEPs”) and Savings Incentive Match Plan for Employees (“SIMPLE”) IRAs adopted according to Section 408 of the Internal Revenue Code (see 10. FEDERAL TAX MATTERS). The Contract does not provide any additional tax deferral if you purchase it to fund an IRA or other investment vehicle that already provides tax deferral.

For information on how to purchase the Contract, please see 1. THE CONTRACT.

This section is a brief summary of the Contract’s features. More detailed information follows later in this prospectus.

Investment Limitations

• Initial premium payment must be at least $5,000 for non-qualified contracts.

• Initial premium payment must be at least $2,000 for all other contracts.

• Each subsequent premium payment must be at least $500.

• If you are a member of a retirement plan covering three or more persons and premium payments are made through an automatic investment program, the initial and subsequent premium payments for the Contract must average at least $100 and not be less than $50.

• The total sum of all premium payments may not be greater than $2,000,000 without prior home office approval.

You may allocate your net premium payments to the investment options.

• A complete list of the divisions may be found in 12. TABLE OF SEPARATE ACCOUNT DIVISIONS. Each division invests in shares of an underlying mutual fund. More detailed information about the underlying mutual funds may be found in the current prospectus for each underlying mutual fund. These underlying mutual fund prospectuses are bound together with this prospectus.

• The investment options also include the Fixed Account and the DCA Plus accounts.

• The GMWB riders impose limitations on the investment options available by requiring you to allocate 100% of your Separate Account assets to one of the designated fund options for the life of the rider.

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Transfers

During the accumulation period:

• a dollar amount or percentage of transfer must be specified;

• a transfer may occur on a scheduled or unscheduled basis;

• transfers to the Fixed Account are not permitted if a transfer has been made from the Fixed Account to a division within six months; and

• transfers into DCA Plus accounts are not permitted.

During the annuitization period, transfers are not permitted (no transfers once payments have begun).

See 1. THE CONTRACT, 3. FIXED ACCOUNT AND DCA PLUS ACCOUNTS, and 6. TRANSFERS AND SURRENDERS for additional restrictions.

This Transfers section does not apply to transfers under the DCA Plus program. See 3. FIXED ACCOUNT AND DCA PLUS ACCOUNTS.

Surrenders

During the accumulation period:

• the gross dollar amount to be surrendered must be specified;

• surrendered amounts may be subject to surrender charges:

• for Contracts without the Premium Payment Credit Rider, the maximum surrender charge is 6% of the amount(s) surrendered; or

• for Contracts with the Premium Payment Credit Rider, the maximum surrender charge is 8% of the amount(s) surrendered;

• full surrender of your Contract may be subject to an annual Contract fee;

• during a contract year, each partial surrender that is less than the Free Surrender Amount is not subject to a surrender charge; and

• surrenders before age 59½ may involve an income tax penalty (see 10. FEDERAL TAX MATTERS).

During the annuitization period, surrenders are not allowed.

See 6. TRANSFERS AND SURRENDERS for additional information.

Charges and Deductions

• No sales charge is deducted from premium payments at the time received. However, the Contract may impose a surrender charge on surrenders greater than the Free Surrender Amount.

• A contingent deferred surrender charge is imposed on certain total or partial surrenders.

• An annual mortality and expense risks charge equal to 1.25% of amounts in the Separate Account divisions is imposed daily.

• The optional riders are available at an additional cost

• Premium Payment Credit Rider – The current annual rider charge is 0.60% of the average daily accumulated value in the Separate Account divisions, deducted daily (with no reduction of the Fixed Account interest rate). The maximum annual rider charge is 0.60% of the average daily accumulated value in the Separate Account divisions, deducted daily (with a reduction of up to 0.60% of the Fixed Account interest rate).

• Principal Income Builder 3 – The current annual rider charge is 0.95% of the average For Life withdrawal benefit base, deducted quarterly. The maximum annual rider charge is 1.65%.

• Principal Income Builder 10 – The current annual rider charge is 1.10% of the average Investment Back withdrawal benefit base, deducted quarterly. The maximum annual rider charge is 2.00%.

• An annual Separate Account administration charge equal to 0.15% of amounts in the Separate Account divisions is imposed daily.

• There are underlying mutual fund expenses. More detailed information about the underlying mutual fund expenses may be found in the current prospectus for each underlying mutual fund.

• Contracts with an accumulated value of less than $30,000 are subject to an annual fee of the lesser of $30 or 2% of the accumulated value. Currently we do not charge the annual fee if youraccumulated value is $30,000 or more. If you own more than one variable annuity contract with us, then all the contracts you own or jointly own are aggregated on each contract’s anniversary to determine if the $30,000 minimum has been met and whether that contract will be charged.

• Certain states and local governments impose a premium tax. We reserve the right to deduct the amount of the tax from premium payments or the accumulated value.

See 2. CHARGES AND DEDUCTIONS for additional information.

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Annuity Benefit Payments

• You may choose from several fixed annuity benefit payment options which are described in 7.THE ANNUITIZATION PERIOD.

• Payments are made to the owner (or beneficiary depending on the annuity benefit payment option selected). You should carefully consider the tax implications of each annuity benefit payment option. See 7.THE ANNUITIZATION PERIOD and 10. FEDERAL TAX MATTERS.

Death Benefit

• The standard death benefit generally is the greatest of the accumulated value, the total of premium payments minus an adjustment for surrenders, or the highest accumulated value on any Contract anniversary wholly divisible by seven. See 8. DEATH BENEFIT for more specific details.

• If the owner dies before the annuitization date, a death benefit is payable. The death benefit may be paid as either a single payment or under an annuity benefit payment option. If no election is made within the required period of time, the full amount will be paid in a lump sum to the applicable state. Once the money is paid to the applicable state, the beneficiary will have to contact the state to request additional assistance.

• If the annuitant dies after the annuitization date, payments will continue only as provided by the annuity benefit payment option in effect.

• The death benefit provided for each of the optional riders is:

• Principal Income Builder 3 – beneficiary receives the death benefit under the Contract.

• Principal Income Builder 10 - generally allows the beneficiary(ies) to elect the death benefit under the Contract or the Investment Back remaining withdrawal benefit base.

• Enhanced Death Benefit Rider - generally is the greatest of the standard death benefit, premium payments accumulated at 5% effective annual interest rate or the highest accumulated value on any Contract anniversary.

See 8. DEATH BENEFIT and 7. THE ANNUITIZATION PERIOD.

Examination Offer Period (free look)

You may return the Contract during the examination offer period, which is generally 10 days from the date you receive the Contract. The examination offer period may be longer in certain states.

• The amount refunded will be a full refund of youraccumulated value plus any Contract charges and premium taxes you paid unless state law requires otherwise. The underlying mutual fund fees and charges are not refunded to you as they are already factored into the Separate Account division value.

• The amount refunded may be more or less than the premium payments made.

• We recapture the full amount of any premium payment credit or exchange credit.

See 1.THECONTRACT for additional information.

Optional Riders

Subject to certain conditions, you may elect to add one or more of the available optional riders to your Contract. Not all riders are available in all states or through all broker dealers and may be subject to additional restrictions. Some rider provisions may vary from state to state. We may withdraw or prospectively restrict the availability of any rider at any time. For information regarding availability of any rider, you may contact your registered representative or call us at 1-800-852-4450.

The optional riders currently available are:

• Premium Payment Credit Rider – This rider applies credits to the accumulated value for premium payments made in contract year one. The surrender charge period is nine years if this rider is elected.

• Guaranteed Minimum Withdrawal Benefit riders (you may only elect one GMWB rider):

• Principal Income Builder 3 – This rider allows you to take certain guaranteed annual withdrawals during the Contract accumulation phase, regardless of your Contract accumulated value. This rider includes an annual bonus in the first 3 contract years for not taking withdrawals. Election of this rider results in restriction of your Contract investment options to the more limited GMWB investment options.

• Principal Income Builder 10 – This rider allows you to take certain guaranteed annual withdrawals during the Contract accumulation phase, regardless of your Contract accumulated value. This rider includes an annual bonus in the first 10 contract years for not taking withdrawals. Election of this rider results in restriction of your Contract investment options to the more limited GMWB investment options.

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Termination

The Contract will terminate:

• If no premiums are paid during two consecutive calendar years and the accumulated value (or total premium payments less partial surrenders and applicable surrender charges) is less than $2,000 unless you have a GMWB rider.

• If you fully annuitize and youraccumulated value on the annuitization date is less than $2,000 or if the amount applied under an annuity benefit payment option is less than the minimum requirement.

The GMWB rider will terminate:

• The date you send us notice to terminate the rider (after the 5th Contract anniversary following the rider effective date).

• The date you fully annuitize, fully surrender or otherwise terminate the Contract.

• The date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except when the change in owner is due to a spousal continuation of the rider or the removal/addition of a joint life.

• The date your surviving spouse elects to continue the Contract without this rider (even if prior to the fifth Contract anniversary following the rider effective date).

• The date you make an impermissible change in a covered life.

• If you have a GMWB1, GMWB 2-SL, GMWB 2-SL/JL, or PIB 10 rider:

• If the Investment Back remaining withdrawal benefit base and the For Life withdrawal benefit base are both zero.

• The date the Investment Back remaining withdrawal benefit base is zero and there are no eligible covered lives.

• If you have the PIB 3 rider, the date the For Life withdrawal benefit base is zero or there are no eligible covered lives.

The Enhanced Death Benefit rider will terminate:

• The date the Contract owner is changed.

• Upon the death of the owner.

• The date the Contract terminates.

• The date the death benefit described in the Contract equals the enhanced death benefit under this rider so long as this occurs after the Lock-In Date.

• The date we receive your request to cancel it in our office.

The Waiver of Surrender Charge rider will terminate the date the Contract owner is changed.

1. THE CONTRACT

The Principal^® Investment Plus Variable Annuity is significantly different from a fixed annuity. As the owner of a variable annuity, you assume the risk of investment gain or loss (as to amounts in the Separate Account divisions) rather than the Company. The Separate Account divisionvalue under a variable annuity is not guaranteed and varies with the investment performance of the underlying mutual funds.

Based on your investment objectives, you direct the allocation of premium payments and accumulated values. There can be no assurance that your investment objectives will be achieved.

How to Buy a Contract

If you want to buy a Contract, you must submit an application and make an initial premium payment. If you are buying the Contract to fund a SIMPLE-IRA or SEP, an initial premium payment is not required at the time you send in the application. If the application is complete and the Contract applied for is suitable, the Contract is issued. If the completed application is received in good order, the initial premium payment is credited within two valuation days after the later of receipt of the application or receipt of the initial premium payment at ourhome office. If the initial premium payment is not credited within five valuation days, it is refunded unless we have received your permission to retain the premium payment until we receive the information necessary to issue the Contract.

The date the Contract is issued is the contract date. The contract date is the date used to determine contract years, regardless of when the Contract is delivered.

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Tax-qualified retirement arrangements, such as IRAs, SEPs, and SIMPLE-IRAs, are tax-deferred. You derive no additional benefit from the tax deferral feature of the annuity. Consequently, an annuity should be used to fund an IRA or other tax qualified retirement arrangement to benefit from the annuity’s features other than tax deferral. These features may include guaranteed lifetime income, death benefits without surrender charges, guaranteed caps on fees, and the ability to make scheduled transfers among investment options without transaction fees.

Premium Payments

• The initial premium payment must be at least $5,000 for non-qualified contracts.

• The initial premium payment must be at least $2,000 for all other contracts.

• If you are making premium payments through a payroll deduction plan or through a bank (or similar financial institution) account under an automated investment program, your initial and subsequent premium payments must be at least $100.

• All premium payments are subject to a surrender charge period that begins in the contract year each premium payment is received.

• Subsequent premium payments must be at least $500 and can be made until the annuitization date.

• Premium payments are to be made by personal or financial institution check (for example, a cashier’s check). We reserve the right to refuse any premium payment that we feel presents a fraud or money laundering risk. Examples of the types of premium paymentswe will not accept are cash, money orders, starter checks, travelers checks, credit card checks, and foreign checks.

• If you are a member of a retirement plan covering three or more persons, the initial and subsequent premium payments for the Contract must average at least $100 and cannot be less than $50.

• The total sum of all premium payments for a Contract may not be greater than $2,000,000 (maximum premium limit) without our prior approval. For further information, please call 1-800-852-4450.

• We reserve the right to treat all of your and/or your spouse’s Principal deferred variable annuity contracts, with a guaranteed minimum withdrawal benefit rider attached, as one contract for purposes of determining whether you have exceeded the maximum premium limit (without home office approval).

• The Company reserves the right to increase the minimum amount for each premium payment with advance notice.

• Premium payments are credited on the basis of the unit value next determined after we receive a premium payment.

• The state of Washington does not allow premium payments to be made after the first contract year on Contracts issued with the Premium Payment Credit Rider. See 5. PREMIUM PAYMENT CREDIT RIDER for more information.

• If no premium payments are made during two consecutive calendar years and the accumulated value is less than $2,000, we reserve the right to terminate the Contract. See 9. ADDITIONAL INFORMATION ABOUT THE CONTRACT.

Allocating Premium Payments

• On your application, you direct how yourpremium payments will be allocated to the investment options.

• Allocations must be in percentages.

• Percentages must be in whole numbers and total 100%.

• Subsequent premium payments are allocated according to your then current allocation instructions.

• Changes to the allocation instructions are made without charge.

• A change is effective on the next valuation period after we receive your new instructions in good order.

• You can change the current allocations and future allocation instructions by:

•mailing your instructions to us;

•calling us at 1-800-852-4450 (if telephone privileges apply);

•faxing your instructions to us at 1-866-894-2093; or

•visiting www.principal.com.

• Changes to premium payment allocations do not result in the transfer of any existing investment optionaccumulated values. You must provide specific instructions to transfer existing accumulated values. We currently do not charge a transaction fee for these transfers but reserve the right to charge such a fee in the future.

• Premium payments are credited on the basis of the unit value next determined after we receive a premium payment

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Principal^® Variable Annuity Exchange Offer (“exchange offer”)

This exchange offer is available on and after January 4, 2010. Original owners of an eligible Principal^® variable annuity contract may elect to exchange their Principal^® variable annuity contract (“old contract”) for a new Principal^® Investment Plus Variable Annuity contract ("new contract") subject to the exchange offer terms and conditions. To determine if it is in your best interest to participate in the exchange offer, we recommend that you consult with your tax advisor and financial professional before electing to participate in the exchange offer.

You are eligible to participate in the exchange offer when:

• your old contract is not subject to any surrender charges; and

• the exchange offer is available in your state.

Currently, there is no closing date for the exchange offer. We reserve the right, however, to modify or terminate the exchange offer upon reasonable written notice to you .

See APPENDIX A for further details about the exchange offer.

Investment Plus Variable Annuity GMWB Exchange Offer

IPVA GMWB exchange offer ("GMWB exchange offer")

This GMWB exchange offer was made available effective January 20, 2014. Original owners of an eligible Principal^® Investment Plus Variable Annuity contract (“old contract”) may elect to exchange their old contract for a new Principal^® Lifetime Income Solutions II Variable Annuity contract ("new contract") subject to the GMWB exchange offer terms and conditions below. To determine if it is in your best interest to participate in the GMWB exchange offer, we recommend that you consult with your tax advisor and financial professional before electing to participate in the GMWB exchange offer.

You are eligible to participate in the GMWB exchange offer when:

• The old contract doesn't have a GMWB rider; or

• The old contract has a GMWB 1 rider; and

• Your old contract is not subject to any surrender charges; and

• Available in your state.

Currently, there is no closing date for the GMWB exchange offer. We reserve the right, however, to modify or terminate the GMWB exchange offer upon reasonable written notice to you .

See APPENDIX A-2 for further details about the GMWB exchange offer.

Exchange Credit (for exchanges from our fixed deferred annuities)

If you own a fixed deferred annuity issued by us and are no longer subject to surrender charges, you may transfer the accumulated value, without charge, to the Contract described in this prospectus. We will add 1% of the fixed annuity contract’s surrender value at the time of exchange to this Contract’s accumulated value. There is no charge or cost to you for this exchange credit.

This exchange credit is allocated among the Contract’s investment options in the same ratio as your allocation of premium payments. The credit is treated as earnings.

NOTE: The exchange may not be suitable for you if you do not want to accept market risk. Fixed deferred annuities provide a fixed rate of accumulation. This Contract provides Separate Account divisions. The value of this Contract will increase or decrease depending on the investment performance of the Separate Account divisionsyou select.

NOTE: The charges and provisions of a fixed annuity contract and this Contract differ. The charges for this Contract are typically higher than charges for a fixed annuity and will increase further if you elect the Premium Payment Credit Rider, a GMWB rider or other optional rider. In some instances, your existing fixed annuity contract may have benefits that are not available under this Contract.

NOTE: This exchange credit may not be available in all states. In addition, we reserve the right to change or discontinue the exchange credit. You may obtain more specific information regarding the exchange credit from your registered representative or by calling us at 1-800-852-4450.

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Right to Examine the Contract (free look)

It is important to us that you are satisfied with the purchase of your Contract. Under state law, you have the right to return the Contract for any reason during the examination offer period (a “free look”). The examination offer period is the later of 10 days after the Contract is delivered to you, or such later date as specified by applicable state law.

Although we currently allocate your initial premium payments to the investment optionsyou have selected, during times of economic uncertainty and with prior notice to you, we may exercise our right to allocate initial premium payments to the Money Market division during the examination offer period. If your initial premium payments are allocated to the Money Market division and the free look is exercised, you will receive the greater of premium payments or the accumulated value.

NOTE: All references to the Money Market division in this prospectus will mean the Fidelity VIP Government Money Market Division.

In California, for owners age 60 or older, we allocate initial premium payments to the Money Market division during the examination offer period unless you elect to immediately invest in the allocations you selected. If yourpremium payments were allocated to the Money Market division, after the free look period ends, youraccumulated value will be converted into units of the division(s) according to your allocation instructions. The units allocated will be based on the unit value next determined for each division.

To exercise your free look, you must send the Contract and a written request to us postmarked before the close of business on the last day of the examination offer period.

If you properly exercise your free look, we will cancel the Contract. In the states that require us to return yourpremium payments, we will return the greater of yourpremium payments or accumulated value. In all states we will return at least youraccumulated value plus any premium tax charge deducted, and minus any applicable federal and state income tax withholding. The amount returned may be higher or lower than the premium payment(s) applied during the examination offer period.

If you are purchasing this Contract to fund an IRA, SIMPLE-IRA, or SEP-IRA and you return it on or before the seventh day of the examination offer period, we will return the greater of:

• the total premium payment(s) made; or

• youraccumulated value plus any premium tax charge deducted, less any applicable federal and state income tax withholding and depending upon the state in which the Contract was issued, any applicable fees and charges.

You may obtain more specific information regarding the free look from your registered representative or by calling us at 1-800-852-4450.

Accumulated Value

The accumulated value of your Contract is the total of the Separate Account division value plus the DCA Plus account(s)value plus the Fixed Accountvalue. The DCA Plus accounts and Fixed Account are described in the section titled 3. FIXED ACCOUNT AND DCA PLUS ACCOUNTS.

There is no guaranteed minimum Separate Account division value. The value reflects the investment experience of the divisions that you choose and also reflects yourpremium payments, partial surrenders, surrender charges, partial annuitizations and the Contract expenses deducted from the Separate Account.

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The Separate Account division value changes from day to day. To the extent the accumulated value is allocated to the Separate Account divisions, you bear the investment risk. At the end of any valuation period, your Contract’s value in a division is:

• the number of units you have in a division multiplied by

• the value of a unit in the division.

The number of units is equal to the total units purchased by allocations to the division from:

• your initial premium payment;

• subsequent premium payments;

• your exchange credit;

• premium payment credits; and

• transfers from another investment option

minus units sold:

• for partial surrenders and/or partial annuitizations from the division;

• as part of a transfer to another division or the Fixed Account; and

• to pay Contract charges and fees (not deducted as part of the daily unit value calculation).

Unit values are calculated each valuation date at the close of normal trading of the NYSE. To calculate the unit value of a division, the unit value from the previous valuation date is multiplied by the division’s net investment factor for the current valuation period. The number of units does not change due to a change in unit value.

The net investment factor measures the performance of each division. The net investment factor for a valuation period is [(a plus b) divided by (c)] minus d where:

a = the share price (net asset value) of the underlying mutual fund at the end of the valuation period;

b = the per share amount of any dividend* (or other distribution) made by the mutual fund during the valuation period;

c = the share price (net asset value) of the underlying mutual fund at the end of the previous valuation period; and

d = the daily charge for Total Separate Account Annual Expenses and any Optional Riders, if applicable. The daily charge is calculated by dividing the annual amount of these expenses by 365 and multiplying by the number of days in the valuation period.

* When an investment owned by an underlying mutual fund pays a dividend, the dividend increases the net asset value of a share of the underlying mutual fund as of the date the dividend is recorded. As the net asset value of a share of an underlying mutual fund increases, the unit value of the corresponding division also reflects an increase. Payment of a dividend under these circumstances does not increase the number of units you own in the division.

The Company reserves the right to terminate a Contract and send you the accumulated value if no premiums are paid during two consecutive calendar years and the accumulated value (or total premium payments less partial surrenders and applicable surrender charges) is less than $2,000 unless you have a GMWB rider. The Company will first notify you of its intent to exercise this right and give you 60 days to increase the accumulated value to at least $2,000.

Telephone and Internet Services

If you elect telephone services or you elect internet services and satisfy our internet service requirements (which are designed to ensure compliance with federal UETA and E-SIGN laws), instructions for the following transactions may be given to us via the telephone or internet:

• make premium payment allocation changes;

• set up Dollar Cost Averaging (DCA) scheduled transfers;

• make transfers; and

• make changes to Automatic Portfolio Rebalancing(APR).

Neither the Company nor the Separate Account is responsible for the authenticity of telephone service or internet transaction requests. We reserve the right to refuse telephone service or internet transaction requests. You are liable for a loss resulting from a fraudulent telephone or internet order that we reasonably believe is genuine. We follow procedures in an attempt to assure genuine telephone service or internet transactions. If these procedures are not followed, we may be liable for loss caused by unauthorized or fraudulent transactions. The procedures may include recording telephone service transactions, requesting personal identification (for example, name, address, security phrase, password, daytime telephone number, or birth date) and sending written confirmation to your address of record.

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Instructions received via our telephone services and/or the internet are binding on both owners if the Contract is jointly owned.

If the Contract is owned by a business entity or a trust, an authorized individual (with the proper password) may use telephone and/or internet services. Instructions provided by the authorized individual are binding on the owner.

We reserve the right to modify or terminate telephone service or internet transaction procedures at any time. Whenever reasonably feasible, we will provide you with prior notice (by mail or by email, if previously authorized by you) if we modify or terminate telephone service or internet transaction procedures. In some instances, it may not be reasonably feasible to provide prior notice if we modify or terminate telephone service or internet transaction procedures; however, any modification or termination will apply to all Contract owners in a non-discriminatory fashion.

Telephone Services

Telephone services are available to you. Telephone services may be declined on the application or at any later date by providing us with written notice. You may also elect telephone authorization for your registered representative by providing us written notice.

If you elect telephone privileges, instructions

• may be given by calling us at 1-800-852-4450 while we are open for business (generally, between 8 a.m. and 6 p.m. Eastern Time on any day that the NYSE is open).

• that are in good order and received by us before the close of a valuation period will receive the price next determined (the value as of the close of that valuation period).

• that are in good order and received by us after the close of a valuation period will receive the price next determined (the value as of the close of the next valuation period).

• that are not in good order when received by us will be effective the next valuation date that we receive good order instructions.

Internet

Internet services are available to you if you register for a secure login on the Principal Financial Group web site, www.principal.com. You may also elect internet authorization for your registered representative by providing us written notice.

If you register for internet privileges, instructions

• that are in good order and received by us before the close of a valuation period will receive the price next determined (the value as of the close of that valuation period).

• that are in good order and received by us after the close of a valuation period will receive the price next determined (the value as of the close of the next valuation period).

• that are not in good order when received by us will be effective the next valuation day that we receive good order instructions.

2. CHARGES AND DEDUCTIONS

Certain charges are deducted under the Contract. If the charge is not sufficient to cover our costs, we bear the loss. If the expense is more than our costs, the excess is profit to the Company. We expect a profit from all the fees and charges listed below, except the Annual Fee, Transaction Fee and Premium Tax. For a summary, see SUMMARY OF EXPENSE INFORMATION.

In addition to the charges under the Contract, there are also deductions from and expenses paid out of the assets of the underlying mutual funds which are described in the underlying mutual funds’ prospectuses.

Surrender Charge

No sales charge is collected or deducted when premium payments are applied under the Contract. A surrender charge is assessed on certain total or partial surrenders. The amounts we receive from the surrender charge are used to cover some of the expenses of the sale of the Contract (primarily commissions, as well as other promotional or distribution expenses). If the surrender charge collected is not enough to cover the actual costs of distribution, the costs are paid from the Company’s General Account assets which include profit, if any, from the mortality and expense risks charge.

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NOTE: If you plan to make multiple premium payments, you need to be aware that each premium payment has its own surrender charge period (shown below). The surrender charge for any total or partial surrender is a percentage of all premium payments surrendered which were received by us during the contract years prior to the surrender. The applicable percentage which is applied to the premium payments surrendered is determined by the following tables.

Surrender charge for Contracts without the Premium Payment Credit Rider (as a percentage of amounts surrendered):

Number of completed contractyears since each premium payment was made	Surrender charge applied to all premium payments received in that contractyear
0 (year of premium payment)	6%
1	6%
2	6%
3	5%
4	4%
5	3%
6	2%
7 and later	0

Surrender Charge for Contracts with the Premium Payment Credit Rider (as a percentage of amounts surrendered):

Number of completed contract years since each premium payment was made	Surrender charge applied to all premium payments received in that contractyear
0 (year of premium payment)	8%
1	8%
2	7%
3	6%
4	5%
5	4%
6	3%
7	2%
8	1%
9 and later	0%

Each premium payment begins in year 0 for purposes of calculating the percentage applied to that premium payment. However, premium payments are added together by contract year for purposes of determining the applicable surrender charge. If yourcontract year begins April 1 and ends March 31 the following year, all premium payments received during that period are considered to have been made in that contract year.

NOTE:    Regarding Contracts written in the states of Alabama, Massachusetts, and Washington:

• For Contracts without the Premium Payment Credit Rider, surrender charges are applicable only to premium payments made in the first three contract years.

• For Contracts with the Premium Payment Credit Rider, surrender charges are applicable only to premium payments made in the first contract year.

For purpose of calculating surrender charges, we assume that surrenders and transfers are made in the following order:

• first from premium payments no longer subject to a surrender charge;

• then from the free surrender privilege (first from the earnings, then from the oldest premium payments (i.e., on a first-in, first-out basis)) described below; and

• then from premium payments subject to a surrender charge on a first-in, first-out basis.

NOTE:    Partial surrenders may be subject to both a surrender charge and a transaction fee.

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Free Surrender Amount

The free surrender amount may be surrendered without a surrender charge. This amount is the greater of:

• earnings in the Contract (earnings equal accumulated value less unsurrendered premium payments as of the date of the surrender); or

• 10% of the premium payments, decreased by any partial surrenders and partial annuitizations since the last Contract anniversary.

Any amount not taken under the free surrender amount in a contract year is not added to the amount available under the free surrender amount for any following contract year(s).

Unscheduled partial surrenders of the free surrender amount may be subject to the transaction fee (see Transaction Fee).

When Surrender Charges Do Not Apply

The surrender charge does not apply to:

• amounts applied under an annuity benefit payment option; or

• payment of any death benefit, however, the surrender charge does apply to premium payments made by a surviving spouse after an owner’s death; or

• amounts distributed to satisfy the minimum distribution requirement of Section 401(a)9 of the Internal Revenue Code, provided that the amount surrendered does not exceed the minimum distribution amount which would have been calculated based on the value of this Contract alone; or

• an amount transferred from a Contract used to fund an IRA to another annuity contract issued by the Company to fund an IRA of the participant’s spouse when the distribution is made pursuant to a divorce decree.

Waiver of Surrender Charge Rider

This rider is automatically added to the Contract at issue. There is no charge for this benefit.

This rider waives the surrender charge on surrenders made after the first Contract anniversary if the original owner or original annuitant has a critical need. A critical need is limited to confinement to a health care facility, terminal illness diagnosis, or total and permanent disability.

The benefits are available for a critical need if the following conditions are met:

• the original owner or original annuitant has a critical need (NOTE: A change of ownership will terminate this rider; once terminated the rider may not be reinstated); and

• the critical need did not exist before the contract date.

For the purposes of this rider, the following definitions apply:

• health care facility — a licensed hospital or inpatient nursing facility providing daily medical treatment and keeping daily medical records for each patient (not primarily providing just residency or retirement care). This does not include a facility primarily providing drug or alcohol treatment, or a facility owned or operated by the owner, annuitant or a member of their immediate families. If the critical need is confinement to a health care facility, the confinement must continue for at least 60 consecutive days after the contract date and the surrender must occur within 90 days of the confinement’s end.

• terminal illness — sickness or injury that results in the owner’s or annuitant’s life expectancy being 12 months or less from the date notice to receive a distribution from the Contract is received by the Company. In Texas and New Jersey, terminal illness is not included in the criteria for critical need.

• total and permanent disability — a disability that occurs after the contract date but before the original owner or annuitant reaches age 65 and qualifies to receive social security disability benefits. In New York, a different definition of total and permanent disability applies. In Oregon, total and permanent disability is not included in the criteria for critical need.

NOTE: The Waiver of Surrender Charge Rider is not available in Massachusetts.

Transaction Fee

To assist in covering our administration costs, we reserve the right to charge a transaction fee of the lesser of $25 or 2% of each unscheduled partial surrender after the 12th unscheduled partial surrender in a contract year. The transaction fee would be deducted from the accumulated value remaining in the investment option(s) from which the amount is surrendered, on a pro rata basis.

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To assist in covering our administration costs or to discourage market timing, we also reserve the right to charge a transaction fee of the lesser of $30 or 2% of each unscheduled transfer after the first unscheduled transfer in a contract year. The transaction fee would be deducted from the investment option(s) from which the amount is transferred, on a pro rata basis.

If we elect to begin charging for the transaction fees, we will provide you with advance written notice.

Premium Taxes

We reserve the right to deduct an amount to cover any premium taxes imposed by states or other jurisdictions. If we elect to begin deducting any premium taxes, we will provide you with advance written notice. Any deduction is made from either a premium payment when we receive it, or the accumulated value when you request a surrender (total or partial) or you request application of the accumulated value (full or partial) to an annuity benefit payment option. Premium taxes range from 0% in most states to as high as 3.50%.

Annual Fee

Contracts with an accumulated value of less than $30,000 are subject to an annual Contract fee of the lesser of $30 or 2% of the accumulated value. Currently, we do not charge the annual fee if youraccumulated value is $30,000 or more. If we elect to begin charging the annual fee if youraccumulated value is $30,000 or more, we will provide you with advance written notice. If you own more than one variable annuity contract with us, all the Contracts you own or jointly own are aggregated, on each Contract’s anniversary, to determine if the $30,000 minimum has been met and whether that Contract will be charged. The fee is deducted from the investment option that has the greatest value. The fee is deducted on each Contract anniversary and upon total surrender of the Contract. The fee assists in covering administration costs, primarily costs to establish and maintain the records which relate to the Contract.

Separate Account Annual Expenses

Mortality and Expense Risks Charge

We assess each division with a daily charge for mortality and expense risks. The annual rate of the charge is 1.25% of the average daily net assets of the Separate Account divisions. We agree not to increase this charge for the duration of the Contract. This charge is assessed only prior to the annuitization date. This charge is assessed daily when the value of a unit is calculated.

This charge is intended to compensate us for the mortality risk on the Contract. We have a mortality risk in that we guarantee payment of a death benefit in a single payment or under an annuity benefit payment option. We do not impose a surrender charge on a death benefit payment, which is an additional mortality risk.

This charge is also intended to cover our expenses, primarily related to operation of the Contract, including

• furnishing periodic Contract statements, confirmations and other customer communications;

• preparation and filing of regulatory documents (such as this prospectus);

• preparing, distributing and tabulating proxy voting materials related to the underlying mutual funds; and

• providing computer, actuarial and accounting services.

If the mortality and expense risks charge is not enough to cover our costs, we bear the loss. If the mortality and expense risks charge is more than our costs, the excess is profit to the Company.

Administration Charge

We assess each division with a daily Separate Account administration charge. The annual rate of the charge is 0.15% of the average daily net assets of the Separate Account divisions. This charge is assessed only prior to the annuitization date. This charge is assessed daily when the value of a unit is calculated. The administration charge is intended to cover our costs for administration of the Contract that are not covered in the mortality and expense risk charge, above.

If the administration charge is not enough to cover our costs, we bear the loss. If the administration charge is more than our costs, the excess is profit to the Company.

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Premium Payment Credit Rider

The maximum annual charge for this rider is 0.60% of the average daily net assets of the Separate Account divisions and a reduction of 0.60% of the Fixed Account interest rate. We currently impose the maximum charge against the average daily net assets of the Separate Account divisions, but do not currently impose the Fixed Account interest rate reduction. We will provide prior written notice in the event that we decide to exercise our right to reduce the Fixed Account interest rate.

If you elect the Premium Payment Credit Rider, the rider charge is assessed until completion of your 8th contract year (and only prior to the annuitization date) even if the credit(s) have been recovered. This charge is assessed daily against the Separate Account division values in the same manner as the mortality and expense risks charge, above. After the 8th Contract anniversary, your Contract accumulated value is moved to units in your chosen divisions that do not include this rider charge. This move of divisionunits will not affect youraccumulated value. It will, however, result in a smaller number of divisionunits but those units will have a higher unit value. We will notify you when the divisionunits move because of discontinuation of the rider charge.

The rider charge is intended to cover our cost for the credit(s).

Charges for Rider Benefits Currently Available

Subject to certain conditions, you may add one or more of the following optional riders to your Contract. Please contact your registered representative or call us at 1-800-852-4450 if you have any questions.

Principal Income Builder 3 (PIB 3) Rider

This version of the PIB 3 Rider is no longer available for applications signed August 1, 2013 and later (or when the most recent version is approved in your state).

For applications signed before August 1, 2013, and in states where the most recent version of the rider is not approved, the current annual charge for the rider is 0.95% of the average quarterly For Life withdrawal benefit base. The charge is calculated and deducted from youraccumulated value at the end of the calendar quarter at a quarterly rate of 0.2375%, based on the average quarterly For Life withdrawal benefit base during the calendar quarter.

The average quarterly For Life withdrawal benefit base is equal to (1) the For Life withdrawal benefit base at the beginning of the calendar quarter plus (2) the For Life withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

If we increase the rider charge, you will be notified in advance. Before the effective date of the rider charge increase, you have the following options:

• Accept the increased rider charge and continue to be eligible to receive a GMWB Step-Up at each rider anniversary; or

• Decline the increased rider charge by sending us notice that you are opting out of the GMWB Step-Up and electing to remain at your current rider charge. Once you opt out of the GMWB Step-Up, you will no longer be eligible for any future GMWB Step-Ups and the feature cannot be added back to this rider.

At the end of each calendar quarter (or on the next valuation date, if the calendar quarter ends on a non-valuation date), the rider charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a calendar quarter, the rider charge is prorated according to the number of days this rider is in effect during the calendar quarter. Upon termination of this rider, the rider charge will be based on the number of days this rider is in effect during the calendar quarter.

We reserve the right to increase the rider charge up to the maximum annual charge. The maximum annual charge is 1.65% (0.4125% quarterly) of the average quarterly For Life withdrawal benefit base.

The rider charge is intended to reimburse us for the cost of the protection provided by this rider.

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Principal Income Builder 10 (PIB 10) Rider

This version of the PIB 10 Rider is no longer available for applications signed August 1, 2013 and later (or when the most recent version is approved in your state).

For applications signed before August 1, 2013, and in states where the most recent version of the rider is not approved, the current annual charge for the rider is 1.10% of the average quarterly Investment Back withdrawal benefit base. The charge is calculated and deducted from youraccumulated value at the end of the calendar quarter at a quarterly rate of 0.2750%, based on the average quarterly Investment Back withdrawal benefit base during the calendar quarter.

The average quarterly Investment Back withdrawal benefit base is equal to (1) the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus (2) the Investment Back withdrawal benefit base at the end of the calendar quarter, and this sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

If we increase the rider charge, you will be notified in advance. Before the effective date of the rider charge increase, you have the following options:

• Accept the increased rider charge and continue to be eligible to receive a GMWB Step-Up at each rider anniversary; or

• Decline the increased rider charge by sending us notice that you are opting out of the GMWB Step-Up and electing to remain at your current rider charge. Once you opt out of the GMWB Step-Up, you will no longer be eligible for any future GMWB Step-Ups and the feature cannot be added back to this rider.

At the end of each calendar quarter (or on the next valuation date, if the calendar quarter ends on a non-valuation date), the rider charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a calendar quarter, the rider charge is prorated according to the number of days this rider is in effect during the calendar quarter. Upon termination of this rider, the rider charge will be based on the number of days this rider is in effect during the calendar quarter.

We reserve the right to increase the rider charge up to the maximum annual charge. The maximum annual charge is 2.00% (0.5000% quarterly) of the average quarterly Investment Back withdrawal benefit base.

The rider charge is intended to reimburse us for the cost of the protection provided by this rider.

Charges for Rider Benefits No Longer Available

Enhanced Death Benefit Rider(No Longer Available For Sale)

For rider applications signed on or after January 4, 2010, the Enhanced Death Benefit Rider is not available. If you have the Enhanced Death Benefit Rider, please see APPENDIX H for a description of the rider and its charges.

GMWB 1 Rider -- Investment Protector Plus (No Longer Available For Sale)

For rider applications signed on or after January 4, 2010, the GMWB 1 Rider is not available. If you have the GMWB 1 Rider, see APPENDIX G for a description of the rider and its charges.

GMWB 2-SL (Single Life) Rider -- Investment Protector Plus 2 (No Longer Available For Sale)

For rider applications signed on or after January 21, 2008, the GMWB 2-SL (Single Life) Rider is not available. If you have the GMWB 2-SL Rider, see APPENDIX F for a description of the rider and its charges.

GMWB 2-SL/JL (Single Life/Joint Life) Rider -- Investment Protector Plus 2 (No Longer Available For Sale)

For rider applications signed on or after July 23, 2012, the GMWB 2-SL/JL (Single Life/Joint Life) Rider is not available. If you have the GMWB 2-SL/JL Rider, see APPENDIX E for a description of the rider and its charges.

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Special Provisions for Group or Sponsored Arrangements

Where permitted by state law, Contracts may be purchased under group or sponsored arrangements as well as on an individual basis.

Group Arrangement – program under which a trustee, employer or similar entity purchases Contracts covering a group of individuals on a group basis.

Sponsored Arrangement – program under which an employer permits group solicitation of its employees or an association permits group solicitation of its members for the purchase of Contracts on an individual basis.

The charges and deductions described above may be reduced or eliminated for Contracts issued in connection with group or sponsored arrangements. The rules in effect at the time the application is approved will determine if reductions apply. Reductions may include but are not limited to sales of Contracts without, or with reduced, mortality and expense risks charges, annual fees or surrender charges.

Eligibility for and the amount of these reductions are determined by a number of factors, including the number of individuals in the group, the amount of expected premium payments, total assets under management for the owner, the relationship among the group’s members, the purpose for which the Contract is being purchased, the expected persistency of the Contract, and any other circumstances which, in our opinion, are rationally related to the expected reduction in expenses. Reductions reflect the reduced sales efforts and administration costs resulting from these arrangements. We may modify the criteria for and the amount of the reduction in the future. Modifications will not unfairly discriminate against any person, including affected owners and other owners with contracts funded by the Separate Account.

3. FIXED ACCOUNT AND DCA PLUS ACCOUNTS

This prospectus is intended to serve as a disclosure document only for the Contract as it relates to the Separate Account and contains only selected information regarding the Fixed Account and DCA Plus accounts. The Fixed Account and the DCA Plus accounts are a part of our General Account. Because of exemptions and exclusions contained in the Securities Act of 1933 and the Investment Company Act of 1940, the Fixed Account, the DCA Plus accounts, and any interest in them, are not subject to the provisions of these acts. As a result the SEC has not reviewed the disclosures in this prospectus relating to the Fixed Account and the DCA Plus accounts. However, disclosures relating to them are subject to generally applicable provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses.

Our obligations with respect to the Fixed Account and DCA Plus accounts are supported by our General Account. The General Account is the assets of the Company other than those assets allocated to any of our Separate Accounts. Subject to applicable law, we have sole discretion over the assets in the General Account. Separate Account expenses are not assessed against any Fixed Account or DCA Plus account values. You can obtain more information concerning the Fixed Account and DCA Plus accounts from your registered representative or by calling us at 1-800-852-4450.

We reserve the right to refuse premium payment allocations and transfers from the other investment options to the Fixed Account and premium payment allocations to the DCA Plus accounts. We will send you a written notice at least 30 days prior to the date we exercise this right. We will also notify you if we lift such restrictions.

Fixed Account

The Company guarantees that premium payments allocated and amounts transferred to the Fixed Account earn interest at the interest rate in effect on the date premium payments are received or amounts are transferred. This rate applies to each premium payment or amount transferred through the end of the contract year.

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Each Contract anniversary, we declare a renewal interest rate that applies to the Fixed Accountvalue in existence at that time. This rate applies until the end of the contract year. Interest is earned daily and compounded annually at the end of each contract year. Once credited, the interest is guaranteed and becomes part of the Fixed Account value from which deductions for fees and charges may be made.

NOTE: We reserve the right to reduce the Fixed Account interest rate by up to 0.60% if you elect the Premium Payment Credit Rider.

NOTE: Transfers and surrenders from the Fixed Account are subject to certain limitations as to frequency and amount. See 6. TRANSFERS AND SURRENDERS.

NOTE: We may defer payment of surrender proceeds payable out of the Fixed Account for up to six months. See 9. ADDITIONAL INFORMATION ABOUT THE CONTRACT.

FixedAccount Value

YourFixed Account value on any valuation date is equal to:

• premium payments or credits allocated to the Fixed Account;

• plus any transfers to the Fixed Account from the other investment options;

• plus interest credited to the Fixed Account;

• minus any surrenders or applicable surrender charges or partial annuitizations from the Fixed Account;

• minus any transfers to the Separate Account

Dollar Cost Averaging Plus Program (DCA Plus Program)

Premium payments allocated to the DCA Plus accounts earn the interest rate in effect at the time each premium payment is received. A portion of yourDCA Plus accountvalue is periodically transferred (on the 28th of each month) to Separate Account divisions or to the Fixed Account. If the 28th is not a valuation date, the transfer occurs on the next valuation date. The transfers are allocated according to your DCA Plus allocation instructions. Transfers into a DCA Plus account are not permitted. There is no charge for participating in the DCA Plus program.

NOTE: If you elect the Premium Payment Credit Rider, you may not participate in the DCA Plus program.

DCA Plus Premium Payments

You may enroll in the DCA Plus program by allocating a minimum premium payment of $1,000 into a DCA Plus account and selecting investment options into which transfers will be made. Subsequent premium payments of at least $1,000 are permitted. You can change your DCA Plus allocation instructions during the transfer period. Automatic Portfolio Rebalancing does not apply to DCA Plus accounts.

DCA Plus premium payments receive the fixed interest rate in effect on the date each premium payment is received by us. The fixed interest rate remains in effect for the remainder of the 6-month or 12-month DCA Plus program.

Selecting a DCA Plus Account

DCA Plus accounts are available in either a 6-month transfer program or a 12-month transfer program. The 6-month transfer program and the 12-month transfer program generally will have different credited interest rates. You may enroll in both a 6-month and 12-month DCA Plus program. However, you may only participate in one 6-month and one 12-month DCA Plus program at a time. Under the 6-month transfer program, all premium payments and accrued interest must be transferred from the DCA Plus account to the selected investment options in no more than 6 months. Under the 12-month transfer program, all premium payments and accrued interest must be transferred to the selected investment options in no more than 12 months.

We will transfer an amount each month which is equal to yourDCA Plus account value divided by the number of months remaining in yourtransfer program. For example, if four scheduled transfers remain in the six-month transfer program and the DCA Plus accountvalue is $4,000, the transfer amount would be $1,000 ($4,000 / 4).

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DCA Plus Transfers

Transfers are made from DCA Plus accounts to the investment options according to your allocation instructions. The transfers begin after we receive yourpremium payment and completed enrollment instructions. Transfers occur on the 28th of the month and continue until your entire DCA Plus accountvalue is transferred.

Unscheduled DCA Plus Transfers.You may make unscheduled transfers from DCA Plus accounts to the investment options. A transfer is made, and values determined, as of the end of the valuation period in which we receive your request.

DCA Plus Surrenders.You may take scheduled or unscheduled surrenders from DCA Plus accounts. Premium payments earn interest according to the corresponding rate until the surrender date. Surrenders are subject to any applicable surrender charge.

4. LIVING BENEFIT - GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB) – APPLICATIONS SIGNED BEFORE AUGUST 1, 2013

These versions of PIB 3 Rider and PIB 10 Rider are no longer available for applications signed August 1, 2013 and later (or when the most recent versions are approved in your state).

Guaranteed Minimum Withdrawal Benefit (“GMWB”) riders are designed to help protect you against the risk of a decrease in the Contract accumulated value due to market declines. The GMWB rider allows you to take certain guaranteed annual withdrawals during the Contract accumulation phase, regardless of your Contract accumulated value.

Between July 23, 2012 and August 1, 2013, we made available two optional GMWB riders, the Principal Income Builder 3 rider and the Principal Income Builder 10 rider.

Prior to July 23, 2012, we made available other GMWB riders. However, no Contract may have more than one GMWB rider. For a description of GMWB 1 Rider -- Investment Protector Plus, see APPENDIX G. For a description of GMWB 2-SL Rider -- Investment Protector Plus 2, see APPENDIX F. For a description of GMWB 2-SL/JL Rider – Investment Protector Plus 2, see Appendix E.

You may elect a GMWB rider only when you purchase the Contract. We reserve the right, in our sole discretion, to allow Contract owners to add a rider after issue. If we exercise this right, we will give written notice and our offer will not be unfairly discriminatory.

GMWB Rider Restrictions/Limitations

Once elected, the GMWB rider may not be terminated for 5 contract years following the rider effective date.

The GMWB rider does not restrict or change your right to take — or not take — withdrawals under the Contract. All withdrawals reduce the Contract accumulated value by the amount withdrawn and are subject to the same conditions, limitations, fees, charges and deductions as withdrawals otherwise taken under the provisions of the Contract; for example, withdrawals will be subject to surrender charges if they exceed the free surrender amount (see 2.CHARGES AND DEDUCTIONS). However, any withdrawals may have an impact on the value of your rider’s benefits. If you take withdrawals in an amount that exceeds an available withdrawal benefit payment (excess withdrawal), you will shorten the life of the rider, lower the withdrawal benefit payment(s) and/or cause the rider to terminate for lack of value unless you make additional premium payments or a GMWB Step-Up is applied.

There is a charge for the GMWB rider which can increase up to the guaranteed maximum charge for the rider (see SUMMARY OF EXPENSE INFORMATION).

Election of a GMWB rider results in restriction of your Contract investment options to the more limited GMWB investment options (see GMWB Investment Options).

Any ownership change, change of beneficiary or other change before the annuitization date which would cause a change in a covered life may result in termination of this rider (see Covered Life Change).

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GMWB Investment Options

While a GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under a GMWB rider (the “GMWB investment options”) reflect a balanced investment objective and if your investment goal is aggressive growth, a GMWB rider may not support your investment objective. With GMWB investment options that reflect a balanced investment objective, there is potentially a reduced likelihood that we will have to make GMWB benefit payments when the Contract value goes to zero, reaches the maximum annuitization date, or if there is a death claim.

When you purchase a GMWB rider, you must allocate 100% of your Separate Account division value to one or more of the available Separate Account GMWB investment options. Any future premium payments are allocated to the GMWB investment option(s) your Separate Account division value is/are invested in at the time of the new premium payments.

The available GMWB investment options are:

• Diversified Balanced Managed Volatility Account;

• Diversified Growth Managed Volatility Account;

• Diversified Balanced Account;

• Diversified Growth Account; and

• Diversified Income Account.

For more information about the Diversified Balanced Managed Volatility Account, Diversified Growth Managed Volatility Account, Diversified Balanced Account, Diversified Growth Account, and Diversified Income Account, see the underlying mutual fund’s prospectus provided with this prospectus.

You may allocate premium payments and transfer Contract accumulated value to the Fixed Account. You may also allocate new premium payments to the DCA Plus accounts. Such allocations and transfers are subject to the provisions of your Contract. See 3. FIXED ACCOUNT AND FIXED DCA PLUS ACCOUNTS.

We reserve the right to modify the list of available GMWB investment options, subject to compliance with applicable regulations. Changes or restrictions will apply only to new purchasers of the Contract or to you if youtransfer out of a GMWB investment option and wish to transfer back to that GMWB investment option.

You must stay invested in the GMWB investment options as long as the GMWB rider is in effect. Note, the rider may not be terminated for 5 contract years following the rider effective date.

Please see APPENDIX B for information regarding GMWB investment options.

Overview of Principal Income Builder 3

This version of the PIB 3 Rider is no longer available for applications signed August 1, 2013 and later (or when the most recent version is approved in your state).

For Life withdrawal benefit payment percentages. This rider permits an election of “Joint Life” For Life withdrawal benefit payments or “Single Life” For Life withdrawal benefit payments.

Bonus feature. This rider has a Bonus feature which rewards you annually for not taking a withdrawal within the first 3 years of the rider. The GMWB Bonus increases the withdrawal benefit base, which increases your available withdrawal benefit payment amount. The GMWB Bonus does not increase your Contract accumulated value.

Step-Up feature. This rider has an annual Step-Up feature which can increase your rider withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are made, the division values rise with market growth, or credits (premium payment credits or exchange credit) are applied.

Maximum annual rider charge. This rider has a maximum annual rider charge of 1.65% of the For Life withdrawal benefit base.

Spousal continuation. This rider provides that the For Life withdrawal options may be available to an eligible spouse who continues the Contract with the rider, if certain conditions are met.

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Principal Income Builder 3 Terms

We use the following definitions to describe the features of this rider:

• Excess Withdrawal — the portion of a withdrawal that exceeds the available withdrawal benefit payment.

• GMWB Bonus — a bonus credited to the withdrawal benefit base, provided certain conditions are met.

• GMWB investment options – the limited investment options available under the GMWB rider, which reflect a balanced investment objective.

• GMWB Step-Up — an increase to the withdrawal benefit base to an amount equal to your Contract’s accumulated value on the most recent Contract anniversary, provided certain conditions are met.

• Required minimum distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions in effect as of the rider effective date.

• Rider effective date — the date the rider is issued.

• Withdrawal — any partial surrender (including surrender charges, if any) and/or any partial annuitization of your Contract’s accumulated value.

• Withdrawal benefit base (also referred to as For Life withdrawal benefit base) — the basis for determining the withdrawal benefit payment available each year

• Withdrawal benefit payment (also referred to as For Life withdrawal benefit payment) — the amount that we guarantee you may withdraw each contract year.

Principal Income Builder 3 - Withdrawal Benefit Base

The withdrawal benefit base is used to calculate the annual withdrawal benefit payment. We calculate the withdrawal benefit base on the rider effective date and each Contract anniversary.

The initial withdrawal benefit base is equal to the initial premium payment.

On each Contract anniversary, the withdrawal benefit base is reset to the greater of 1 or 2, where:

1. is the accumulated value on the Contract anniversary.

2. is the result of (a + b + c - d), where:

a = prior year withdrawal benefit base (or initial withdrawal benefit base if first Contract anniversary);

b = additional premiums since the previous Contract anniversary (dollar-for-dollar);

c = any GMWB Bonus credited since the previous Contract anniversary;

d = any excess withdrawals taken since the previous Contract anniversary*.

* NOTE: The reduction for an excess withdrawal will be greater than dollar-for-dollar if the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal. See Principal Income Builder 3 - Excess Withdrawals later in this section for information about the negative effect of excess withdrawals.

If you take withdrawals prior to the oldest owner attaining age 59½, the For Life withdrawal benefit base will be reduced for excess withdrawals. If the adjustment for any withdrawals causes the For Life withdrawal benefit base to reduce to zero, the rider will terminate at the next Contract anniversary, unless you make additional premium payments or a GMWB Step-Up is applied.

Principal Income Builder 3 - Withdrawal Benefit Payment

For Life withdrawal benefit payments are available (i) on the rider effective date if the oldest owner (or oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or oldest annuitant, if applicable) attains age 59½.

The For Life withdrawal benefit payments are automatically calculated as “Single Life” unless you provide notice and good order instructions to select “Joint Life” For Life withdrawal benefit payments. If eligible, you may elect “Joint Life” For Life withdrawal benefit payments anytime on or before your first withdrawal following the rider effective date. Once you take this first withdrawal, you cannot change your election of “Single Life” or “Joint Life” For Life withdrawal benefit payments, regardless of any change in life events.

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“Single Life” For Life withdrawal benefit payments. “Single Life” For Life withdrawal benefit payments are based on one covered life. The covered life for “Single Life” is the:

a. Owner if there is only one owner;

b. Annuitant if the owner is not a natural person;

c. Youngest joint owner if there are joint owners; or

d. Youngest annuitant if there are joint annuitants and the owner is not a natural person.

In addition, the covered life must satisfy this rider’s issue age requirements on the date the covered life is designated in accordance with the terms of this rider.

As long as the Contract is in effect, “Single Life” or “Joint Life” For Life withdrawal benefit payments may be taken until the earlier of the date of the death of the first owner to die (first annuitant, if applicable) or the date the For Life withdrawal benefit base reduces to zero.

“Joint Life” For Life withdrawal benefit payments. “Joint Life” For Life withdrawal benefit payments are based on two covered lives. You may only elect “Joint Life” For Life withdrawal benefit payments if there are two covered lives that meet the eligibility requirements. There can be no more than two covered lives. The “Joint Life” election is not available if the owner is not a natural person.

To be eligible for “Joint Life” the covered lives must be:

a. The owner and the owner’s spouse, provided there is only one owner and the spouse is named as a primary beneficiary; or

b. The joint owners, provided the joint owners are each other’s spouse.

NOTE: Under the Internal Revenue Code (the “Code”), spousal continuation and certain distribution options are available only to a person who is defined as a “spouse” under the Federal Defense of Marriage Act or other applicable Federal Law. All Contract provisions will be interpreted and administered in accordance with the requirements of the Code.

NOTE: At the time a covered life is designated, that covered life must satisfy this rider’s issue age requirements.

As long as the Contract is in effect, “Joint Life” For Life withdrawal benefit payments will continue until the earlier of the date of the death of the last covered life or the date the “For Life” withdrawal benefit base reduces to zero.

Calculating the Principal Income Builder 3 For Life Withdrawal Benefit Payment

The For Life withdrawal benefit payment is an amount equal to a percentage multiplied by the For Life withdrawal benefit base.

The For Life withdrawal benefit payment percentage depends on whether you have elected “Single Life” or “Joint Life” and the age of the covered life on the date of the first withdrawal following the rider effective date:

“Single Life”:

Age of Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.50%
50-54	4.00%
55-59	4.50%
60-64	4.75%
65-69	5.00%
70-74	5.50%
75-79	6.00%
80+	6.50%

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“Joint Life”:

Age of Younger Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.00%
50-54	3.50%
55-59	4.00%
60-64	4.25%
65-69	4.50%
70-74	5.00%
75-79	5.50%
80+	6.00%

NOTE: All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Under 72t, a customer can receive substantially equal payments without an IRS tax penalty, even if under age 59½. If you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals. See Principal Income Builder 3 - Excess Withdrawals for additional information.

Because the For Life withdrawal benefit payments are tiered based on the age of the younger covered life at the time of the first withdrawal, you should carefully choose when you take the first withdrawal following the rider effective date. Once a withdrawal is taken, the For Life withdrawal benefit payment percentage is locked in for the life of this rider. In addition, when you take your first withdrawal, your election of “Single Life” or “Joint Life” remains locked in and cannot be changed. For example, if you have elected “Joint Life” For Life withdrawal benefit payments and take the first withdrawal when the younger covered life is age 46, your For Life withdrawal benefit payment percentage will be locked in at 3.00% for the remaining life of this rider and cannot be changed.

Principal Income Builder 3 - Covered Life Change

Any ownership change, change of beneficiary or other change before the annuitization date which would cause a change in a covered life (a “Change”) will result in termination of this rider, except for the following permissible Changes:

1. Spousal continuation of this rider as described below in Spousal Continuation of the Principal Income Builder 3 Rider.

2. If withdrawals have not been taken and you have not previously elected to continue this rider as provided in Spousal Continuation of the Principal Income Builder 3 Rider, then:

a. You may add a joint owner or primary beneficiary to your Contract as a covered life, provided that the new joint owner or primary beneficiary is an eligible covered life as set forth above.

b. You may remove a joint owner or primary beneficiary as a covered life.

c. The For Life withdrawal benefit payment percentage will be based on the age of the covered lives and will lock in at the percentage applicable on the date of your first withdrawal.

3. If withdrawals have been taken and you have locked in “Single Life” For Life withdrawal benefit payments, then:

a. You may remove a joint owner as a covered life.

b. You may add a primary beneficiary to your Contract, however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. The For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

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4. If withdrawals have been taken and you have locked in “Joint Life” For Life withdrawal benefit payments, then:

a. You may remove a joint owner or primary beneficiary as a covered life.

b. You may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. The For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

5. If you have previously elected to continue this rider as provided in Spousal Continuation of the Principal Income Builder 3 Rider, then you may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider. If the primary beneficiary that you add is your spouse, upon your death the spouse can continue the Contract, but the rider will terminate.

No Change is effective until approved by us in writing. Upon our approval, the Change is effective as of the date you signed the notice requesting the Change.

An assignment of the Contract or this rider shall be deemed a request for a Change. If the Change is not one of the above permissible Changes, this rider will be terminated as of the date of the assignment.

Principal Income Builder 3 - Effect of Withdrawals

This rider does not require you to take an available withdrawal benefit payment. If you want to take advantage of this rider’s GMWB Bonus feature, withdrawals cannot be taken during the period the GMWB Bonus is available. Please see Principal Income Builder 3 - GMWB Bonus below.

If you elect not to take an available withdrawal benefit payment, that amount will not be carried forward to the next contract year.

Each time you take a withdrawal, it is reflected immediately in your Contract accumulated value. All scheduled withdrawals (scheduled partial surrenders) occurring on the Contract anniversary are reflected in the values for the prior contract year.

If you take excess withdrawals, the withdrawal benefit base will be reduced on the next Contract anniversary. See Principal Income Builder 3 - Excess Withdrawals for information about the negative effect of excess withdrawals.

To help you better understand the various features of this rider and to demonstrate how premium payments made and withdrawals taken from the Contract affect the values and benefits under this rider, we have provided several examples in APPENDIX C.

Principal Income Builder 3 - Excess Withdrawals

Any withdrawals that exceed the available withdrawal benefit payments are excess withdrawals. Excess withdrawals decrease the withdrawal benefit base, which will reduce future withdrawal benefit payments. The reductions can be greater than dollar-for-dollar when the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal.

All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Therefore, if you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals.

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If you choose to take an excess withdrawal, the equation below shows how to calculate the excess withdrawal adjustment.

Effect on withdrawal benefit base. Excess withdrawals will reduce the withdrawal benefit base in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the withdrawal benefit base prior to the adjustment for the excess withdrawal.

NOTE:    Withdrawals prior to age 59½ may be subject to a 10% IRS penalty tax.

Required Minimum Distribution (RMD) Program for GMWB Riders

Tax-qualified contracts are subject to certain federal tax rules requiring that RMD be taken on a calendar year basis (i.e., compared to a contract year basis), usually beginning after age 72.

If you are eligible for and enroll in our RMD Program for GMWB Riders, as discussed below, a withdrawal taken to satisfy RMD for the Contract (an “RMD amount”) that exceeds a withdrawal benefit payment for that contract year will not be deemed an excess withdrawal.

RMD Program. Eligibility in the RMD Program for GMWB Riders is determined by satisfaction of the following requirements:

• Your Contract may not have the Enhanced Death Benefit Rider;

• The amount required to be distributed each calendar year for purposes of satisfying the RMD rules of the Internal Revenue Code is based only on this Contract (the “RMD amount”); and

• You have elected scheduled withdrawal payments.

NOTE: Although enrollment in the RMD Program for GMWB Riders does not prevent you from taking an unscheduled withdrawal, an unscheduled withdrawal will cause you to lose the RMD Program protections for the remainder of the contract year. This means that any withdrawals (scheduled or unscheduled) during the remainder of the contract year that exceed applicable withdrawal benefit payments will be treated as excess withdrawals, even if the purpose is to take the RMD amount.You will automatically be re-enrolled in the RMD Program for GMWB Riders on your next Contract anniversary.

We reserve the right to modify or eliminate the RMD Program for GMWB Riders; for example, if there is a change to the Internal Revenue Code or Internal Revenue Service rules or interpretations relating to RMD, including the issuance of relevant IRS guidance. We will send you at least 30 days advance notice of any change in or elimination of the RMD Program for GMWB Riders. Any modifications or elimination of the RMD Program for GMWB Riders will take effect after notice. If we exercise our right to modify or eliminate the RMD Program for GMWB Riders, then any scheduled or unscheduled withdrawal in excess of a withdrawal benefit payment after the effective date of the program’s modification or elimination will be deemed an excess withdrawal.

You may obtain more information regarding our RMD Program for GMWB Riders by contacting your registered representative or by calling us at 1-800-852-4450.

Principal Income Builder 3 - GMWB Bonus

Under the GMWB Bonus, on each of the first three Contract anniversaries following the rider effective date, we will credit a bonus (“GMWB Bonus”) to the withdrawal benefit base provided you have not taken any withdrawals since the rider effective date.

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The GMWB Bonus is equal to the total of all premium payments made prior to the applicable Contract anniversary multiplied by the applicable percentage shown in the chart below. If the contract date and the rider effective date are different (if we previously have allowed Contract owners to add a rider after issue), the GMWB Bonus is equal to the Contract accumulated value on the rider effective date plus premium payments made between the rider effective date and the Contract anniversary, multiplied by the applicable percentage shown in the chart below.

Contract Anniversary (following the rider effective date)	GMWB Bonus Percentage
1	7.00%
2	6.00%
3	5.00%

The GMWB Bonus is no longer available after the earlier of:

• The 3^rd Contract anniversary following the rider effective date; or

• The date you take a withdrawal following the rider effective date.

NOTE: The GMWB Bonus is used only for the purposes of calculating the withdrawal benefit bases. The GMWB Bonus is not added to your Contract accumulated value.

Principal Income Builder 3 - GMWB Step-Up

The GMWB Step-Up is automatic and applies annually. Under this rider, unless an owner opts out of the automatic GMWB Step-Up, the rider charge will increase if our then current rider charge is higher than when the rider was purchased. The rider charge will never be greater than the maximum Principal Income Builder 3 rider charge. See SUMMARY OF EXPENSE INFORMATION section.

If you satisfy the eligibility requirements on a Contract anniversary and your Contract accumulated value is greater than the withdrawal benefit base, we will Step-Up the withdrawal benefit base to your Contract accumulated value on that Contract anniversary. We will not reduce your withdrawal benefit base if your Contract accumulated value on a Contract anniversary is less than the withdrawal benefit base.

NOTE: All scheduled withdrawals (scheduled partial surrenders) occurring on the Contract anniversary are reflected in the values for the prior contract year and prior to determining if the withdrawal benefit base will Step-Up.

If you are eligible for a GMWB Step-Up of a withdrawal benefit base, you will be charged the then current rider charge. You may choose to opt out of the GMWB Step-Up feature if the charge for your rider will increase. We will send you advance notice if the charge for your rider will increase in order to give you the opportunity to opt out of the GMWB Step-Up feature. Once you opt out, you will no longer be eligible for future GMWB Step-Ups.

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of the withdrawal benefit base if you satisfy all of the following requirements:

1. The Contract anniversary occurs before the later of:

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. 10 years after the rider effective date;

2. You have not declined any increases in the rider charge; and

3. You have not fully annuitized the Contract.

Principal Income Builder 3 - Effect of Reaching the Maximum Annuitization Date

On or before the maximum annuitization date, you must elect one of the Contract or GMWB rider payment options described below.

1. Contract payment options:

• Payments resulting from applying the Contract accumulated value to an annuity benefit payment option.

• Payment of the Contract accumulated value as a single payment.

2. GMWB rider payment option:

• Fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment until the date of death of the last covered life.

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Please see Principal Income Builder 3 - Effect of Withdrawals for information on how withdrawals prior to the maximum annuitization date affect the GMWB values.

We will send you written notice at least 30 days prior to the maximum annuitization date and ask you to select one of the available payment options listed above. If we have not received your election as of the maximum annuitization date, we will automatically apply your Contract accumulated value to an annuity benefit payment option:

• for Contracts with one annuitant – Life Income with payments guaranteed for a period of 10 years.

for Contracts with joint annuitants – Joint and Full Survivor Income with payments guaranteed for a period of 10 years.

Principal Income Builder 3 - Effect of the Contract Accumulated Value Reaching Zero

We will send you prior written notice whenever reasonably feasible if your Contract accumulated value is approaching zero.

In the event that the Contract accumulated value reduces to zero, we will pay the withdrawal benefit payments as follows:

• If you have taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, your For Life withdrawal option is either “Joint Life” or “Single Life” depending on your election at the time of your first withdrawal.

• If you have not taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, you must elect either

• the “Single Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Single Life” For Life withdrawal benefit payment, until the date of your death (annuitant’s death if the owner is not a natural person); or the “Joint Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Joint Life” For Life withdrawal benefit payment, until the date of the death of the last covered life.

NOTE: In the event that the Contract accumulated value reduces to zero, the withdrawal benefit payments elected above will continue, but all other rights and benefits under this rider and the Contract (including the death benefits) will terminate, and no additional premium payments will be accepted.

Principal Income Builder 3 - Upon Death

If the Contract Accumulated Value is Greater than Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is greater than zero at your death.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The primary beneficiary(ies) will receive the death benefit under the Contract*. All other rights and benefits under the rider and Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may: a. Continue the Contract with or without this rider as set forth in Spousal Continuation of the Principal Income Builder 3Rider; or b. Receive the death benefit under the Contract*. All other primary beneficiaries will receive the death benefit under the contract. Unless your spouse elects to continue the Contract with this rider, only your spouse’s and beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

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If you die and...	And...	Then...
You are a joint owner	The surviving joint owner is not your spouse	Your surviving owner will receive the death benefit under the Contract*. All other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may: a. Continue the Contract with or without this rider as set forth below in Spousal Continuation of the Principal Income Builder 3Rider; or b. Receive the death benefit under the Contract. Unless the surviving spouse owner elects to continue the Contract with this rider, upon your death, only your spouse’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

* Please see 8.DEATH BENEFIT for an explanation of the Contract’s death benefit and payment options available for the Contract’s death benefit.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receive the death benefit under the Contract. If a beneficiary dies before the annuitant, on the annuitant's death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. If no beneficiary(ies) survive the annuitant, the death benefit is paid to the owner. Upon the annuitant's death, only the beneficiary(ies) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

If the Contract Accumulated Value is Zero. The following table illustrates the various situations and the resulting outcomes if the Contract accumulated value is zero at your death.

If you die and…	And…	Then…
You are the sole owner	You elected the “Single Life” For Life withdrawal option*	All payments stop and all rights and benefits under the Contract terminate.
You are the sole owner	You elected the “Joint Life” withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life's death. Upon the surviving covered life's death, all payments stop and all rights and benefits under the Contract terminate.

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If you die and…	And…	Then…
You are a joint owner	You elected the “Single Life” For Life withdrawal option*	All payments stop and all rights and benefits under the Contract terminate.
You are a joint owner	You elected the “Joint Life” withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life’s death. Upon the surviving joint owner’s death, all payments stop and all rights and benefits under the Contract terminate.

* Please see Effect of the Contract Accumulated Value Reaching Zerounder the Principal Income Builder 3 Rider for details regarding election of the For Life withdrawal option.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

Principal Income Builder 3 - Termination and Reinstatement

You may not terminate this rider prior to the 5^th Contract anniversary following the rider effective date.

At any point in time, we will terminate this rider upon the earliest to occur:

• The date you send us notice to terminate the rider (after the 5^th Contract anniversary following the rider effective date). This will terminate the rider, not the Contract.

• The date you fully annuitize, fully surrender or otherwise terminate the Contract.

• The For Life withdrawal benefit base is zero.

• The date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except a change in owner due to a spousal continuation of the rider as described in Spousal Continuation of the Principal Income Builder 3 Rider or the removal/ addition of a joint life as described in Principal Income Builder 3 - Covered Life Change.

• The date your surviving spouse elects to continue the Contract without this rider (even if prior to the 5^th Contract anniversary following the rider effective date).

• The date you make an impermissible change in a covered life.

If this rider terminates for any reason other than full surrender of the Contract, this rider may not be reinstated.

If you surrender the Contract with this rider attached and the Contract is later reinstated, this rider also must be reinstated. At the time this rider is reinstated, we will deduct rider charges scheduled during the period of termination and make any other adjustments necessary to reflect any changes in the amount reinstated and the Contract accumulated value as of the date of termination.

Principal Income Builder 3 - Spousal Continuation

This rider provides that the For Life withdrawal benefit payment may be available in certain situations to an eligible spouse who continues the Contract with the rider.

If you die while this rider is in effect and if your surviving spouse elects to continue the Contract in accordance with its terms, the surviving spouse may also elect to continue this rider if:

1. The Contract accumulated value is greater than zero;

2. There has not been a previous spousal continuation of the Contract and this rider; and

3. Your spouse is either:

a.    your primary beneficiary, if you were the sole owner; or

b.    the surviving joint owner, if there were joint owners.

If your spouse elects to continue the Contract without this rider, this rider and all rights, benefits and charges under this rider will terminate and cannot be reinstated.

NOTE: Although spousal continuation may be available under federal tax laws for a subsequent spouse, this rider may be continued one time only.

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The following table illustrates the various changes and the resulting outcomes associated with continuation of this rider by an eligible surviving spouse.

If you die and…	And…	Then if your spouse continues this Contract…
No withdrawals have been taken since the rider effective date	Your spouse meets the minimum issue age requirement	Your spouse may continue the rider and take withdrawals until the earlier of their death or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will automatically be calculated as “Single Life” and your spouse will be the sole covered life. Your spouse may not add a new covered life or elect “Joint Life”. The For Life withdrawal benefit percentage will be based on your spouse’s age and will lock in at the “Single Life” percentage applicable on the date of your spouse’s first withdrawal. All other provisions of this rider will continue as in effect on the date of your death.
No withdrawals have been taken since the rider effective date	Your spouse does not meet the minimum issue age requirement	The Principal Income Builder 3 rider terminates upon your death. All other provisions of this Contract will continue as in effect on the date of your death.

If you die and…	And…	And…	Then if your spouse continues this Contract…
Withdrawals have been taken since the rider effective date	You have locked in “Single Life” For Life withdrawal benefits	---	The Principal Income Builder 3 rider terminates upon the death of the first owner to die. All other provisions of this Contract will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	Your spouse is the surviving covered life	Your spouse may continue the rider and take For Life withdrawal benefit payments until the earlier of their death or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will continue to be calculated as “Joint Life”. The For Life withdrawal benefit percentage will remain locked in at the “Joint Life” percentage applicable on the date of your first withdrawal and will not be reset to reflect your death. All other provisions of this rider will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	There is no surviving covered life	The Principal Income Builder 3 rider terminates upon your death. All other provisions of this Contract will continue as in effect on the date of your death.

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Principal Income Builder 3 - Effect of Divorce

The following table illustrates divorce situations and the resulting outcomes.

If…	And…	Then…
You are the sole owner of the contract	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. You will retain all rights and benefits of the rider. Note: If the excess withdrawal causes the For Life withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 3 - Excess Withdrawals.
You are the sole owner of the contract	You direct us to change ownership of the Contract to your former spouse to satisfy a court order	The GMWB rider will terminate. Your former spouse will become the new owner of the Contract and will retain all rights and benefits of the Contract.
Contract is jointly owned	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. If you direct us to remove one of the joint owners, the spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes the For Life withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 3 - Excess Withdrawals.
Contract is jointly owned	You direct us to remove one of the joint owners to satisfy a court order	If withdrawals have been taken, “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file will remain in effect. If withdrawals have not been taken, For Life withdrawal benefits will be calculated “Single Life”. The spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes the For Life withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 3 - Excess Withdrawals.

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Principal Income Builder 3 Rider Summary

Name of Rider	PIB 3
Marketing Name	Principal Income Builder 3
Rider Issue Age	45 – 80
Rider Charge	PIB 3 Charges (as a percentage of average quarterly For Life withdrawal benefit base) •Maximum annual charge is 1.65%. •Current annual charge is 0.95%.
Guaranteed Minimum Withdrawal Benefits	•For Life
Annual Withdrawal Limits	• “Single Life” — tiered percentages based on age at first withdrawal, beginning at 3.50% and capping at a maximum of 6.50% of the For Life withdrawal benefit base •“Joint Life” — tiered percentages based on age at first withdrawal, beginning at 3.00% and capping at a maximum of 6.00% of the For Life withdrawal benefit base
For Life Withdrawal Benefit Payments	•“Single Life” or “Joint Life” (your life and the lifetime of your eligible spouse) •For Life withdrawal benefit payments default to “Single Life” unless “Joint Life” is elected •Available the Contract anniversary following the date the oldest owner turns 59½ — all withdrawals prior to that Contract anniversary are excess withdrawals under the For Life withdrawal option
Termination	•You may terminate this rider anytime after the 5th Contract anniversary following the rider effective date
GMWB Step-Up	•Automatic annual GMWB Step-Up available until the later of (a) the Contract anniversary prior to age 80 or (b) 10 years after the rider effective date.
GMWB Bonus	•If no withdrawals are taken, a GMWB Bonus is applied to the benefit bases on each Contract anniversary as shown below. •Year 1 — 7.00% of premium payments •Year 2 — 6.00% of premium payments •Year 3 — 5.00% of premium payments
Investment Restrictions	•You must select one of the available GMWB investment options; there are no additional restrictions on allocations to the Fixed Account or DCA Plus accounts.
Spousal Continuation	•At the death of the first owner to die, a spouse who is a joint owner or primary beneficiary may have the option to continue the Contract with this rider.

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Overview of Principal Income Builder 10 (Applications signed before August 1, 2013)

This version of the PIB 10 Rider is no longer available for applications signed August 1, 2013 and later (or when the new version is approved in your state).

Withdrawal options. This rider provides the flexibility of both a For Life withdrawal option and an Investment Back withdrawal option. You are not required to choose between these two withdrawal options unless your Contract accumulated value is zero or you reach the maximum annuitization date.

The For Life withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines as well as the risk of outliving your money. The Investment Back withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines and is designed to permit you to recover at least yourpremium payments.

For Life withdrawal benefit payment percentages. This rider permits an election of “Joint Life” For Life withdrawal benefit payments or “Single Life” For Life withdrawal benefit payments.

Bonus feature. This rider has a Bonus feature which rewards you annually for not taking a withdrawal in the first 10 years of the rider. The GMWB Bonus increases the withdrawal benefit base, which increases your available withdrawal benefit payment amount. The GMWB Bonus does not increase the remaining withdrawal benefit base. The GMWB Bonus also does not increase your Contract accumulated value.

Step-Up feature. This rider has an annual Step-Up feature which can increase your rider withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are made, the division values rise with market growth, or credits (premium payment credits or exchange credit) are applied.

Maximum annual rider charge. This rider has a maximum annual rider charge of 2.00% of the Investment Back withdrawal benefit base.

Spousal continuation. This rider provides that the Investment Back and the For Life withdrawal options may be available to an eligible spouse who continues the Contract with the rider, if certain conditions are met.

Additional death benefit. This rider also allows your beneficiary(ies) to choose a death benefit under the Contract or any death benefit available under the rider.

Principal Income Builder 10 Terms

We use the following definitions to describe the features of this rider:

• Excess Withdrawal — the portion of a withdrawal that exceeds the available withdrawal benefit payment for a withdrawal option.

• GMWB Bonus — a bonus credited to the withdrawal benefit base for each withdrawal option, provided certain conditions are met.

• GMWB investment options – the limited investment options available under the GMWB rider, which reflect a balanced investment objective.

• GMWB Step-Up — an increase to the withdrawal benefit base and/or remaining withdrawal benefit base for each withdrawal option to an amount equal to your Contract’s accumulated value on the most recent Contract anniversary, provided certain conditions are met.

• Remaining withdrawal benefit base — the amount available for future withdrawal benefit payments under a withdrawal option. The remaining withdrawal benefit base for each withdrawal option is calculated separately. (not applicable to PIB3) 

• Required minimum distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions in effect as of the rider effective date.

• Rider effective date — the date the rider is issued.

• Withdrawal — any partial surrender (including surrender charges, if any) and/or any partial annuitization of your Contract’s accumulated value.

• Withdrawal benefit base — the basis for determining the withdrawal benefit payment available each year under a withdrawal option. The withdrawal benefit base for each withdrawal option is calculated separately.

• Withdrawal benefit payment — the amount that we guarantee you may withdraw each contract year under a withdrawal option.

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Principal Income Builder 10 - Withdrawal Options

For Life Withdrawal Option. This option is intended to help you avoid the risk of out-living your money. You are eligible to take For Life withdrawal benefit payments beginning (i) on the rider effective date if the oldest owner (or the oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or the oldest annuitant, if applicable) attains age 59½. Once eligible, each year you may withdraw an amount up to the annual For Life withdrawal benefit payment until the earlier of the date of the death of the last covered life or the date the For Life withdrawal benefit base reduces to zero.

Investment Back Withdrawal Option. This option is intended to allow a more rapid recovery of yourpremium payments (approximately 14 years). You are eligible to take Investment Back withdrawal benefit payments beginning on the rider effective date. You may withdraw an amount up to the annual Investment Back withdrawal benefit payment until the earlier of the date of your death (annuitant’s death if the owner is not a natural person) or the date the Investment Back remaining withdrawal benefit base equals zero. Under this option, you may take withdrawals prior to the oldest owner attaining age 59½. If you take withdrawals prior to the oldest owner attaining age 59½, the For Life benefit bases will be reduced for excess withdrawals. If the adjustment for the withdrawals causes the For Life withdrawal benefit base to reduce to zero, the For Life withdrawal option will no longer be available to you (unless you make additional premium payments).

Principal Income Builder 10 - Withdrawal Benefit Base

Each withdrawal option has its own withdrawal benefit base, which is used to calculate the annual withdrawal benefit payment for that option. We calculate the withdrawal benefit base for the Investment Back and the For Life withdrawal options separately on:

• The rider effective date and

• Each Contract anniversary.

The initial withdrawal benefit base for both withdrawal options is equal to the initial premium payment.

On each Contract anniversary, the withdrawal benefit base for each withdrawal option is reset to the greater of 1 or 2, where:

1. is the accumulated value on the Contract anniversary.

2. is the result of (a + b + c - d), where:

a = prior year withdrawal benefit base (or initial withdrawal benefit base if first Contract anniversary);

b = additional premiums since the previous Contract anniversary (dollar-for-dollar);

c = any GMWB Bonus credited since the previous Contract anniversary;

d = any excess withdrawals taken since the previous Contract anniversary*.

* NOTE: The reduction for an excess withdrawal will be greater than dollar-for-dollar if the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal. See Principal Income Builder 10 - Excess Withdrawals later in this section for information about the negative effect of excess withdrawals.

If you take withdrawals prior to the oldest owner attaining age 59½, the For Life withdrawal benefit bases will be reduced for excess withdrawals. If the adjustment for the withdrawals causes the For Life withdrawal benefit base to reduce to zero, the For Life withdrawal option will no longer be available to you at the next Contract anniversary, unless you make additional premium payments.

Principal Income Builder 10 - Remaining Withdrawal Benefit Base

Each withdrawal option has its own remaining withdrawal benefit base. The remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments under each withdrawal option. We calculate the For Life and the Investment Back remaining withdrawal benefit bases separately on:

• The rider effective date,

• When a premium payment is made,

• When a GMWB Step-Up is applied, and

• When a withdrawal is taken.

The initial remaining withdrawal benefit base for both withdrawal options is equal to the initial premium payment (and likewise equal to the initial withdrawal benefit base) on the rider effective date.

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After the rider effective date, the remaining withdrawal benefit base for each withdrawal option will be:

• increased dollar-for-dollar by each additional premium payment made and any GMWB Step-Up; and

• decreased dollar-for-dollar for each withdrawal benefit payment taken; and

decreased to reflect any excess withdrawals taken since the previous Contract anniversary (the reduction will be greater than dollar-for-dollar, as shown below, if the Contract accumulated value is less than the remaining withdrawal benefit base at the time of the excess withdrawal). See Principal Income Builder 10 - Excess Withdrawals, below, for information about the negative effect that excess withdrawals have on the riders.

Principal Income Builder 10 - Withdrawal Benefit Payments

The Investment Back withdrawal benefit payment is equal to 7% of the Investment Back withdrawal benefit base. The Investment Back withdrawal benefit payments are available as of the rider effective date.

For Life withdrawal benefit payments are available (i) on the rider effective date if the oldest owner (or oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or oldest annuitant, if applicable) attains age 59½.

The For Life withdrawal benefit payments are automatically calculated as “Single Life” unless you provide notice and good order instructions to select “Joint Life” For Life withdrawal benefit payments. If eligible, you may elect “Joint Life” For Life withdrawal benefit payments anytime on or before your first withdrawal following the rider effective date. Once you take this first withdrawal, you cannot change your election of “Single Life” or “Joint Life” For Life withdrawal benefit payments, regardless of any change in life events.

“Single Life” For Life withdrawal benefit payments. “Single Life” For Life withdrawal benefit payments are based on one covered life. The covered life for “Single Life” is the:

a. Owner if there is only one owner;

b. Annuitant if the owner is not a natural person;

c. Youngest joint owner if there are joint owners; or

d. Youngest annuitant if there are joint annuitants and the owner is not a natural person.

In addition, the covered life must satisfy this rider’s issue age requirements on the date the covered life is designated in accordance with the terms of this rider.

As long as the Contract is in effect, “Single Life” or “Joint Life” For Life withdrawal benefit payments may be taken until the earlier of the date of the death of the first owner to die (first annuitant, if applicable) or the date the For Life withdrawal benefit base reduces to zero.

“Joint Life” For Life withdrawal benefit payments. “Joint Life” For Life withdrawal benefit payments are based on two covered lives. You may only elect “Joint Life” For Life withdrawal benefit payments if there are two covered lives that meet the eligibility requirements. There can be no more than two covered lives. The “Joint Life” election is not available if the owner is not a natural person.

To be eligible for “Joint Life” the covered lives must be:

a. The owner and the owner’s spouse, provided there is only one owner and the spouse is named as a primary beneficiary; or

b. The joint owners, provided the joint owners are each other’s spouse.

NOTE: Under the Internal Revenue Code (the “Code”), spousal continuation and certain distribution options are available only to a person who is defined as a “spouse” under the Federal Defense of Marriage Act or other applicable Federal Law. All Contract provisions will be interpreted and administered in accordance with the requirements of the Code.

NOTE: At the time a covered life is designated, that covered life must satisfy this rider’s issue age requirements.

As long as the Contract is in effect, “Joint Life” For Life withdrawal benefit payments will continue until the earlier of the date of the death of the last covered life or the date the “For Life” withdrawal benefit base reduces to zero.

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Calculating the Principal Income Builder 10 For Life Withdrawal Benefit Payment

The For Life withdrawal benefit payment is an amount equal to a percentage multiplied by the For Life withdrawal benefit base.

The For Life withdrawal benefit payment percentage depends on whether you have elected “Single Life” or “Joint Life” and the age of the covered life on the date of the first withdrawal following the rider effective date:

• “Single Life”:

Age of Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.50%
50-54	4.00%
55-59	4.50%
60-69	5.00%
70-74	5.50%
75-79	6.00%
80+	6.50%

• “Joint Life”:

Age of Younger Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.00%
50-54	3.50%
55-59	4.00%
60-69	4.50%
70-74	5.00%
75-79	5.50%
80+	6.00%

NOTE: All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Under 72t, a customer can receive substantially equal payments without an IRS tax penalty, even if under age 59½. If you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals. See Principal Income Builder 10 - Excess Withdrawals for additional information.

Because the For Life withdrawal benefit payments are tiered based on the age of the younger covered life at the time of the first withdrawal, you should carefully choose when you take the first withdrawal following the rider effective date. Once a withdrawal is taken, the For Life withdrawal benefit payment percentage is locked in for the life of this rider. In addition, when you take your first withdrawal, your election of “Single Life” or “Joint Life” remains locked in and cannot be changed. For example, if you have elected “Joint Life” For Life withdrawal benefit payments and take the first withdrawal when the younger covered life is age 46, your For Life withdrawal benefit payment percentage will be locked in at 3.00% for the remaining life of this rider and cannot be changed.

Principal Income Builder 10 - Covered Life Change

Any ownership change, change of beneficiary or other change before the annuitization date which would cause a change in a covered life (a “Change”) will result in termination of this rider, except for the following permissible Changes:

1. Spousal continuation of this rider as described below in Spousal Continuation of the Principal Income Builder 10 Rider.

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2. If withdrawals have not been taken and you have not previously elected to continue this rider as provided in Spousal Continuation of the Principal Income Builder 10 Rider, then:

a. You may add a joint owner or primary beneficiary to your Contract as a covered life, provided that the new joint owner or primary beneficiary is an eligible covered life as set forth above.

b. You may remove a joint owner or primary beneficiary as a covered life.

c. The For Life withdrawal benefit payment percentage will be based on the age of the covered lives and will lock in at the percentage applicable on the date of your first withdrawal.

3. If withdrawals have been taken and you have locked in “Single Life” For Life withdrawal benefit payments, then:

a. You may remove a joint owner as a covered life.

b. You may add a primary beneficiary to your Contract, however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. The For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

4. If withdrawals have been taken and you have locked in “Joint Life” For Life withdrawal benefit payments, then:

a. You may remove a joint owner or primary beneficiary as a covered life.

b. You may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. The For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

5. If you have previously elected to continue this rider as provided in Spousal Continuation of the Principal Income Builder 10 Rider, then you may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider. If the primary beneficiary that you add is your spouse, upon your death the spouse can continue the Contract, but the rider will terminate.

No Change is effective until approved by us in writing. Upon our approval, the Change is effective as of the date you signed the notice requesting the Change.

An assignment of the Contract or this rider shall be deemed a request for a Change. If the Change is not one of the above permissible Changes, this rider will be terminated as of the date of the assignment.

Principal Income Builder 10 - Effect of Withdrawals

This rider does not require you to take an available withdrawal benefit payment. If you want to take advantage of this rider’s GMWB Bonus feature, withdrawals cannot be taken during the period the GMWB Bonus is available. Please see Principal Income Builder 10 - GMWB Bonus below.

If you elect not to take an available withdrawal benefit payment, that amount will not be carried forward to the next contract year.

Each time you take a withdrawal, it is reflected immediately in your Contract accumulated value and in the remaining withdrawal benefit base for each withdrawal option. All scheduled withdrawals (scheduled partial surrenders) occurring on the Contract anniversary are reflected in the values for the prior contract year.

If you take excess withdrawals, the withdrawal benefit base for each withdrawal option will be reduced on the next Contract anniversary. See Principal Income Builder 10 - Excess Withdrawals for information about the negative effect of excess withdrawals.

To help you better understand the various features of this rider and to demonstrate how premium payments made and withdrawals taken from the Contract affect the values and benefits under this rider, we have provided several examples in APPENDIX D.

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Principal Income Builder 10 - Excess Withdrawals

Any withdrawals that exceed the available withdrawal benefit payments for either withdrawal option are excess withdrawals. Excess withdrawals decrease the withdrawal benefit bases, which will reduce future withdrawal benefit payments.

All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Therefore, if you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals.

The Investment Back withdrawal option permits larger payment to you than the For Life withdrawal option. As a result, if you take a withdrawal in an amount permitted under the Investment Back withdrawal option, that withdrawal will be an excess withdrawal to the extent that it exceeds the applicable For Life withdrawal benefit payment.

Excess withdrawals reduce withdrawal benefit payments, the withdrawal benefit bases, and the remaining withdrawal benefit bases for the two withdrawal options. The reductions can be greater than dollar-for-dollar when the Contract accumulated value is less than the applicable rider withdrawal benefit base at the time of the excess withdrawal.

The withdrawal benefit base is used to determine the withdrawal benefit payment whereas the remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments. These two values are calculated differently and have different purposes; therefore, the excess withdrawal adjustment for each will vary. If you choose to take an excess withdrawal, the equations below show how to calculate the excess withdrawal adjustment.

Effect on withdrawal benefit base. Excess withdrawals will reduce each of the withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the withdrawal benefit base prior to the adjustment for the excess withdrawal.

Effect on remaining withdrawal benefit base. Excess withdrawals will reduce each of the remaining withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the remaining withdrawal benefit base prior to the adjustment for the excess withdrawal.

NOTE: All withdrawals taken prior to the date that the oldest owner (oldest annuitant, if applicable) has met the For Life age eligibility requirement are excess withdrawals.

NOTE: Withdrawals prior to age 59½ may be subject to a 10% IRS penalty tax.

Required Minimum Distribution (RMD) Program for GMWB Riders

Tax-qualified contracts are subject to certain federal tax rules requiring that RMD be taken on a calendar year basis (i.e., compared to a contract year basis), usually beginning after age 72.

If you are eligible for and enroll in our RMD Program for GMWB Riders, as discussed below, a withdrawal taken to satisfy RMD for the Contract (an “RMD amount”) that exceeds a withdrawal benefit payment for that contract year will not be deemed an excess withdrawal.

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RMD Program. Eligibility in the RMD Program for GMWB Riders is determined by satisfaction of the following requirements:

• Your Contract may not have the Enhanced Death Benefit Rider;

• The amount required to be distributed each calendar year for purposes of satisfying the RMD rules of the Internal Revenue Code is based only on this Contract (the “RMD amount”); and

• You have elected scheduled withdrawal payments.

NOTE: Although enrollment in the RMD Program for GMWB Riders does not prevent you from taking an unscheduled withdrawal, an unscheduled withdrawal will cause you to lose the RMD Program protections for the remainder of the contract year. This means that any withdrawals (scheduled or unscheduled) during the remainder of the contract year that exceed applicable withdrawal benefit payments will be treated as excess withdrawals, even if the purpose is to take the RMD amount.You will automatically be re-enrolled in the RMD Program for GMWB Riders on your next Contract anniversary.

We reserve the right to modify or eliminate the RMD Program for GMWB Riders; for example, if there is a change to the Internal Revenue Code or Internal Revenue Service rules or interpretations relating to RMD, including the issuance of relevant IRS guidance. We will send you at least 30 days advance notice of any change in or elimination of the RMD Program for GMWB Riders. Any modifications or elimination of the RMD Program for GMWB Riders will take effect after notice. If we exercise our right to modify or eliminate the RMD Program for GMWB Riders, then any scheduled or unscheduled withdrawal in excess of a withdrawal benefit payment after the effective date of the program’s modification or elimination will be deemed an excess withdrawal.

You may obtain more information regarding our RMD Program for GMWB Riders by contacting your registered representative or by calling us at 1-800-852-4450.

Principal Income Builder 10 - GMWB Bonus

Under the GMWB Bonus, on each of the first 10 Contract anniversaries following the rider effective date, we will credit a bonus (“GMWB Bonus”) to the withdrawal benefit base for each withdrawal option, provided you have not taken any withdrawals since the rider effective date.

The GMWB Bonus is equal to the total of all premium payments made prior to the applicable Contract anniversary multiplied by the applicable percentage shown in the chart below. If the contract date and the rider effective date are different (if we previously have allowed Contract owners to add a rider after issue), the GMWB Bonus is equal to the Contract accumulated value on the rider effective date plus premium payments made between the rider effective date and the Contract anniversary, multiplied by the applicable percentage shown in the chart below.

Contract Anniversary (following the rider effective date)	GMWB Bonus Percentage
1-10	5.00%
11+	0.00%

The GMWB Bonus is no longer available after the earlier of:

• The 10^th Contract anniversary following the rider effective date; or

• The date you take a withdrawal following the rider effective date.

NOTE: The GMWB Bonus is used only for the purposes of calculating the withdrawal benefit bases for each withdrawal option. The GMWB Bonus is not added to your Contract accumulated value.

Principal Income Builder 10 - GMWB Step-Up

The GMWB Step-Up is automatic and applies annually. Under this rider, unless an owner opts out of the automatic GMWB Step-Up, the rider charge will increase if our then current rider charge is higher than when the rider was purchased. The rider charge will never be greater than the maximum Principal Income Builder 10 rider charge. See SUMMARY OF EXPENSE INFORMATION section.

NOTE: All scheduled withdrawals (scheduled partial surrenders) occurring on the Contract anniversary are reflected in the values for the prior contract year and prior to determining if the withdrawal benefit base will Step-Up.

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We determine eligibility for a GMWB Step-Up of the withdrawal benefit base and remaining withdrawal benefit base for each withdrawal option separately. If you satisfy the eligibility requirements on a Contract anniversary and your Contract accumulated value is greater than the applicable withdrawal benefit base, we will Step-Up the applicable withdrawal benefit base and remaining withdrawal benefit base to your Contract accumulated value on that Contract anniversary. We will not reduce your withdrawal benefit base or remaining withdrawal benefit base if your Contract accumulated value on a Contract anniversary is less than a withdrawal benefit base.

If you are eligible for a GMWB Step-Up of a withdrawal benefit base or remaining withdrawal benefit base, you will be charged the then current rider charge. You may choose to opt out of the GMWB Step-Up feature if the charge for your rider will increase. We will send you advance notice if the charge for your rider will increase in order to give you the opportunity to opt out of the GMWB Step-Up feature. Once you opt out, you will no longer be eligible for future GMWB Step-Ups.

The GMWB Step-Up operates as follows:

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of a withdrawal benefit base if you satisfy all of the following requirements:

1. The Contract anniversary occurs before the later of:

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. 10 years after the rider effective date;

2. You have not declined any increases in the rider charge; and

3. You have not fully annuitized the Contract.

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of a remaining withdrawal benefit base if you satisfy all of the following requirements:

1. The Contract anniversary occurs before the later of:

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. 10 years after the rider effective date;

2. You have not declined any increases in the rider charge;

3. You have not fully annuitized the Contract; and

4. The remaining withdrawal benefit base has not reduced to zero during the life of the rider.

NOTE: If you take withdrawals in amounts that reduce the remaining withdrawal benefit base to zero, the remaining withdrawal benefit base is not eligible for a GMWB Step-Up (even if additional premium payments are made).

Principal Income Builder 10 - Effect of Reaching the Maximum Annuitization Date

On or before the maximum annuitization date, you must elect one of the Contract or GMWB rider payment options described below.

1. Contract payment options:

• Payments resulting from applying the Contract accumulated value to an annuity benefit payment option.

• Payment of the Contract accumulated value as a single payment.

2. GMWB rider payment options:

• You may elect the Investment Back withdrawal option and receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment, until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death (death of the first annuitant to die if the owner is not a natural person), we will continue payments as described in Principal Income Builder 10 - Upon Death.

• You may elect the For Life withdrawal option and receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment, until the later of:

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of death of the last covered life.

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in Principal Income Builder 10 - Upon Death.

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The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of rider withdrawal benefit payments.

Please see Principal Income Builder 10 - Effect of Withdrawals for information on how withdrawals prior to the maximum annuitization date affect the GMWB values.

• We will send you written notice at least 30 days prior to the maximum annuitization date and ask you to select one of the available payment options listed above. If we have not received your election as of the maximum annuitization date, we will automatically apply your Contract accumulated value to an annuity benefit payment option:

• for Contracts with one annuitant – Life Income with payments guaranteed for a period of 10 years.

• for Contracts with joint annuitants – Joint and Full Survivor Income with payments guaranteed for a period of 10 years.

Principal Income Builder 10 - Effect of the Contract Accumulated Value Reaching Zero

We will send you prior written notice whenever reasonably feasible if your Contract accumulated value is approaching zero.

In the event that the Contract accumulated value reduces to zero, you must elect either:

• The Investment Back withdrawal option (only available if the Investment Back remaining withdrawal benefit base is greater than zero; please see Principal Income Builder 10 - Effect of Withdrawals); or

• The For Life withdrawal option (only available if the For Life withdrawal benefit base is greater than zero; please see Principal Income Builder 10 - Effect of Withdrawals).

If we have not received your election or if you are receiving Investment Back scheduled withdrawal benefit payments, we will automatically begin making withdrawal benefit payments to you under the Investment Back withdrawal option, unless:

• You have been receiving For Life scheduled withdrawal benefit payments. We will automatically continue to make payments to you under the For Life withdrawal option.

• The Investment Back remaining withdrawal benefit base is zero. We will automatically begin making payments under the Single Life For Life withdrawal option.

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of withdrawal benefit payments.

We will pay the withdrawal benefit payments under the withdrawal option you have elected as follows:

• If you elect the Investment Back withdrawal option, you will receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death, we will continue payments as described in Principal Income Builder 10 - Upon Death.

• If you have taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, your For Life withdrawal option is either “Joint Life” or “Single Life” depending on your election at the time of your first withdrawal.

• If you have not taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, you must elect either:

• The “Single Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Single Life” For Life withdrawal benefit payment, until the later of:

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of your death (annuitant’s death if the owner is not a natural person).

• The “Joint Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Joint Life” For Life withdrawal benefit payment, until the later of:

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of the death of the last covered life.

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in Principal Income Builder 10 - Upon Death.

NOTE: In the event that the Contract accumulated value reduces to zero, the withdrawal benefit payments elected above will continue, but all other rights and benefits under this rider and the Contract (including the death benefits) will terminate, and no additional premium payments will be accepted.

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Principal Income Builder 10 - Upon Death

If the Contract Accumulated Value is Greater than Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is greater than zero at your death.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The primary beneficiary(ies) must elect one of the following: a. Receive the death benefit under the Contract*; or b. Receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only your beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may: a. Continue the Contract with or without this rider as set forth in Spousal Continuation of the Principal Income Builder 10 Rider; or b. Elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** All other primary beneficiaries must elect one of the options listed above in b. Unless your spouse elects to continue the Contract with this rider, only your spouse’s and beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is not your spouse	Your surviving owner must elect one of the following: a. Receive the death benefit under the Contract*; or b. Receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only the surviving owner’s right to the above selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may: a. Continue the Contract with or without this rider as set forth below in Spousal Continuation of the Principal Income Builder 10 Rider; or b. Elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** Unless the surviving spouse owner elects to continue the Contract with this rider, upon your death, only your spouse’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

* Please see 8.DEATH BENEFIT for an explanation of the Contract’s death benefit and payment options available for the Contract’s death benefit.

** We will make payments in an amount and frequency acceptable to us. If a surviving owner or beneficiary chooses a periodic payment, it must be at least $100 per payment until the Investment Back remaining withdrawal benefit base is zero.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

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If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receive the death benefit under the Contract. If a beneficiary dies before the annuitant, on the annuitant's death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. If no beneficiary(ies) survive the annuitant, the death benefit is paid to the owner. Upon the annuitant's death, only the beneficiary(ies) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

If the Contract Accumulated Value is Zero. The following table illustrates the various situations and the resulting outcomes if the Contract accumulated value is zero at your death.

If you die and…	And…	Then…
You are the sole owner	You elected the “Single Life” For Life withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the “Joint Life” For Life withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life's death. Upon the surviving covered life's death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the Investment Back withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the “Single Life” For Life withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the “Joint Life” For Life withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life’s death. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.

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If you die and…	And…	Then…
You are a joint owner	You elected the Investment Back withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.

* Please see Effect of the Contract Accumulated Value Reaching Zerounder the Principal Income Builder 10 Rider for details regarding election of the For Life withdrawal option or the Investment Back withdrawal option.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

If...	And...	Then...
The annuitant dies	The owner is not a natural person The owner elected the “Single Life” For Life Withdrawal option* The owner elected the Investment Back withdrawal option*	The beneficiary(ies) receive the death benefit under the Contract. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the For Life remaining withdrawal benefit base reduces to zero. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the Investment Back remaining withdrawal benefit base reduces to zero.

Principal Income Builder 10 - Termination and Reinstatement

You may not terminate this rider prior to the 5^th Contract anniversary following the rider effective date.

At any point in time, we will terminate this rider upon the earliest to occur:

• The date you send us notice to terminate the rider (after the 5^th Contract anniversary following the rider effective date). This will terminate the rider, not the Contract.

• The date you fully annuitize, fully surrender or otherwise terminate the Contract.

• The date the Investment Back remaining withdrawal benefit base and the For Life withdrawal benefit base are both zero.

• The date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except a change in owner due to a spousal continuation of the rider as described in Spousal Continuation of the Principal Income Builder 10 Rider or the removal/ addition of a joint life as described in Principal Income Builder 10 - Covered Life Change.

• The date your surviving spouse elects to continue the Contract without this rider (even if prior to the 5^th Contract anniversary following the rider effective date).

• The date the Investment Back remaining withdrawal benefit base is zero and there are no eligible covered lives.

• The date you make an impermissible change in a covered life.

If this rider terminates for any reason other than full surrender of the Contract, this rider may not be reinstated.

If you surrender the Contract with this rider attached and the Contract is later reinstated, this rider also must be reinstated. At the time this rider is reinstated, we will deduct rider charges scheduled during the period of termination and make any other adjustments necessary to reflect any changes in the amount reinstated and the Contract accumulated value as of the date of termination.

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Principal Income Builder 10 - Spousal Continuation

This rider provides that the Investment Back and the For Life withdrawal options may be available in certain situations to an eligible spouse who continues the Contract with the rider.

If you die while this rider is in effect and if your surviving spouse elects to continue the Contract in accordance with its terms, the surviving spouse may also elect to continue this rider if:

1. The Contract accumulated value is greater than zero;

2. There has not been a previous spousal continuation of the Contract and this rider; and

3. Your spouse is either:

a.    your primary beneficiary, if you were the sole owner; or

b.    the surviving joint owner, if there were joint owners.

If your spouse elects to continue the Contract without this rider, this rider and all rights, benefits and charges under this rider will terminate and cannot be reinstated.

NOTE: Although spousal continuation may be available under federal tax laws for a subsequent spouse, this rider may be continued one time only.

The following table illustrates the various changes and the resulting outcomes associated with continuation of this rider by an eligible surviving spouse.

If you die and…	And…	Then if your spouse continues this Contract…
No withdrawals have been taken since the rider effective date	Your spouse meets the minimum issue age requirement	Your spouse may take withdrawals under either withdrawal option as follows: a. The For Life withdrawal option will be available until the earlier of the death of your spouse or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will automatically be calculated as “Single Life” and your spouse will be the sole covered life. Your spouse may not add a new covered life or elect “Joint Life”. The For Life withdrawal benefit percentage will be based on your spouse’s age and will lock in at the “Single Life” percentage applicable on the date of your spouse’s first withdrawal. b. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base is zero. c. All other provisions of this rider will continue as in effect on the date of your death.
No withdrawals have been taken since the rider effective date	Your spouse does not meet the minimum issue age requirement	The For Life withdrawal option terminates upon your death. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base is zero. b. All other provisions of this rider will continue as in effect on the date of your death.

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If you die and…	And…	And…	Then if your spouse continues this Contract…
Withdrawals have been taken since the rider effective date	You have locked in “Single Life” For Life withdrawal benefits	---	The For Life withdrawal option terminates upon the death of the first owner to die. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. b. All other provisions of this rider will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	Your spouse is the surviving covered life	Your spouse may take withdrawals under either withdrawal option as follows: a. The For Life withdrawal option will continue to be available until the earlier of the death of your spouse or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will continue to be calculated as “Joint Life”. The For Life withdrawal benefit percentage will remain locked in at the “Joint Life” percentage applicable on the date of your first withdrawal and will not be reset to reflect your death. b. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. c. All other provisions of this rider will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	There is no surviving covered life	The For Life withdrawal option terminates upon your death. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. b. All other provisions of this rider will continue as in effect on the date of your death.

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Principal Income Builder 10 - Effect of Divorce

The following table illustrates divorce situations and the resulting outcomes.

If…	And…	Then…
You are the sole owner of the contract	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. You will retain all rights and benefits of the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 10 - Excess Withdrawals.
You are the sole owner of the contract	You direct us to change ownership of the Contract to your former spouse to satisfy a court order	The GMWB rider will terminate. Your former spouse will become the new owner of the Contract and will retain all rights and benefits of the Contract.
Contract is jointly owned	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. If you direct us to remove one of the joint owners, the spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 10 - Excess Withdrawals.
Contract is jointly owned	You direct us to remove one of the joint owners to satisfy a court order	If withdrawals have been taken, “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file will remain in effect. If withdrawals have not been taken, For Life withdrawal benefits will be calculated “Single Life”. The spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Principal Income Builder 10 - Excess Withdrawals.

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Principal Income Builder 10 Rider Summary

Name of Rider	PIB 10
Marketing Name	Principal Income Builder 10
Rider Issue Age	45 – 80
Rider Charge	PIB 10 Rider Charges (as a percentage of average quarterly Investment Back withdrawal benefit base) •Maximum annual charge is 2.00%. •Current annual charge is 1.10%.
Guaranteed Minimum Withdrawal Benefits	•Investment Back •For Life
Annual Withdrawal Limits	•Investment Back — 7.00% of the Investment Back withdrawal benefit base. •“Single Life” — tiered percentages based on age at first withdrawal, beginning at 3.50% and capping at a maximum of 6.50% of the For Life withdrawal benefit base •“Joint Life” — tiered percentages based on age at first withdrawal, beginning at 3.00% and capping at a maximum of 6.00% of the For Life withdrawal benefit base
For Life Withdrawal Benefit Payments	•“Single Life” or “Joint Life” (your life and the lifetime of your eligible spouse) •For Life withdrawal benefit payments default to “Single Life” unless “Joint Life” is elected •Available the Contract anniversary following the date the oldest owner turns 59½ — all withdrawals prior to that Contract anniversary are excess withdrawals under the For Life withdrawal option
Termination	•You may terminate this rider anytime after the 5th Contract anniversary following the rider effective date
GMWB Step-Up	•Automatic annual GMWB Step-Up available until the later of (a) the Contract anniversary prior to age 80 or (b) 10 years after the rider effective date. •A remaining withdrawal benefit base under a withdrawal option is not eligible for a GMWB Step-Up after the remaining withdrawal benefit base reduces to zero, even if additional premium payments are made.
GMWB Bonus	•If no withdrawals are taken, a GMWB Bonus is applied to the benefit bases on each Contract anniversary as shown below. •Years 1-10 — 5.00% of premium payments •Years 11+ — 0.00% of premium payments
Investment Restrictions	•You must select one of the available GMWB investment options; there are no additional restrictions on allocations to the Fixed Account or DCA Plus accounts.
Spousal Continuation	•At the death of the first owner to die, a spouse who is a joint owner or primary beneficiary may continue the Contract with or without this rider. •The Investment Back withdrawal option continues; the For Life withdrawal option continues only for eligible spouses.

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5. PREMIUM PAYMENT CREDIT RIDER

The Premium Payment Credit Rider applies credits to the accumulated value for premium payments made in contract year one. This rider can only be elected at the time the Contract is issued. Once this rider is elected, it cannot be terminated. There is a charge for this rider (see 2. CHARGES AND DEDUCTIONS) as well as an increased surrender charge and longer surrender charge period.

If you elect this rider, the following provisions apply to the Contract:

• We will apply a credit of 5% of the premium payment to youraccumulated value for each premium payment received during your first contract year. The credit is applied to the Contract on the same date the related premium payment is applied to the Contract. For example, if you make a premium payment of $10,000 in your first contract year, a credit amount of $500 will be added to youraccumulated value (5% x $10,000).

• No credit(s) are applied for premium payments made after the first contract year.

• For Contracts issued in the state of Washington, no premium payments are allowed after the first contract year for Contracts issued with the Premium Payment Credit Rider.

• The premium payment credit is allocated among the investment options according to your then current premium payment allocations.

• We recapture the credit(s) if you exercise your right to return the Contract during the examination offer period or if you request full annuitization of the Contract prior to the third Contract anniversary.

• The amount we recapture may be more than the current value of the credit(s). If yourinvestment options have experienced negative investment performance (i.e., have lost value) you bear the loss for the difference between the original value of the credit(s) and the current (lower) value of the credit(s).

• Partial annuitizations are restricted in each of contract years two and three to no more than 10% of the accumulated value as of the most recent Contract anniversary.

• Credits are considered earnings under the Contract, not premium payments.

• All premium payments are subject to the 9-year surrender charge period and higher surrender charge (see 2. CHARGES AND DEDUCTIONS).

• The Premium Payment Credit Rider cannot be cancelled and the associated surrender charge period and percentages cannot be changed.

• The DCA Plus program is not available to you if you elect this rider.

If you elect the Premium Payment Credit Rider, yourunit values will be lower than if you did not elect the rider. The difference reflects the annual charge for the Premium Payment Credit Rider. After the 8th Contract anniversary, youraccumulated value is moved to units in your chosen divisions that do not include this rider charge. This move of divisionunits will not affect youraccumulated value. It will, however, result in a smaller number of divisionunits but those units will have a higher unit value. We will notify you when the divisionunits move because of discontinuation of the rider charge. The following example is provided to assist you in understanding this adjustment.

	Sample Division Unit Value	Number of Units in Sample Division	Accumulated Value
Prior to the one time adjustment	25.560446	1,611.0709110	$41,179.69
After the one time adjustment	26.659024	1,544.6811189	$41,179.69

You should carefully examine the Premium Payment Credit Rider to decide if this rider is suitable for you. There are circumstances under which you would be worse off for having received the credit. In making this determination, you should consider the following factors:

• this rider increases the amount and duration of the surrender charges, see 2. CHARGES AND DEDUCTIONS;

• we recapture the credit(s) if you exercise your right to return the Contract during the examination offer period or if you request full annuitization of the Contract prior to the third Contract anniversary.

• partial annuitizations are restricted in each of contract years two and three to no more than 10% of the accumulated value as of the most recent Contract anniversary.

• any premium payments made after the first contract year do not have a credit applied even though they are subject to the rider’s higher Separate Account charges; and

• the higher Separate Account charges reduce investment performance.

The charges used to recoup our cost for the premium payment credit(s) include the surrender charge and the Premium Payment Credit Rider charge (see 2. CHARGES AND DEDUCTIONS). We expect to make a profit from these charges.

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The following tables demonstrate hypothetical surrender values for Contracts with and without this rider but do not show the impact of partial surrenders or partial annuitizations. The tables are based on:

• a $25,000 initial premium payment and no additional premium payments;

• the deduction of maximum Separate Account annual expenses:

•Contracts with the Premium Payment Credit Rider:

•2.00% annually for the first eight contract years

•1.40% annually after the first eight contract years

•Contracts without the Premium Payment Credit Rider:

•1.40% annually for all contract years.

• the deduction of the arithmetic average of the underlying mutual fund expenses as of December 31, 2019;

• 0%, 5% and 10% annual rates of return before charges; and

• payment of the $30 annual Contract fee (while the Contract’s value is less than $30,000).

	0% Annual Return		5% Annual Return		10% Annual Return
Contract Year	Surrender Value Without Premium Payment Credit Rider	Surrender Value With Premium Payment Credit Rider	Surrender Value Without Premium Payment Credit Rider	Surrender Value With Premium Payment Credit Rider	Surrender Value Without Premium Payment Credit Rider	Surrender Value With Premium Payment Credit Rider
1	$23,070.94	$23,611.40	$24,245.94	$24,818.90	$25,420.94	$26,072.17
2	$22,505.45	$22,894.54	$24,857.70	$25,297.44	$27,412.18	$28,052.92
3	$21,953.21	$22,412.91	$25,485.71	$26,060.67	$29,625.67	$30,423.42
4	$21,615.13	$21,937.08	$26,388.73	$26,852.43	$32,258.62	$32,943.55
5	$21,278.49	$21,467.10	$27,342.78	$27,655.33	$35,074.01	$35,623.85
6	$20,943.39	$21,003.01	$28,315.54	$28,469.59	$38,085.80	$38,475.63
7	$20,609.91	$20,544.83	$29,307.49	$29,325.46	$41,309.03	$41,510.99
8	$20,457.71	$20,092.60	$30,599.15	$30,193.78	$45,009.88	$44,742.88
9	$19,948.16	$19,767.80	$31,411.83	$31,258.97	$48,455.80	$48,456.63
10	$19,450.56	$19,444.76	$32,246.10	$32,345.82	$52,165.52	$52,435.56
15	$17,132.13	$17,126.97	$36,761.79	$36,875.48	$75,434.97	$75,825.46
20	$15,072.98	$15,068.40	$41,909.86	$42,039.47	$109,084.21	$109,648.89

The better your Contract’s investment performance, the more advantageous the Premium Payment Credit Rider becomes due to the effect of compounding. However, Contracts with the Premium Payment Credit Rider are subject to both a greater surrender charge and a longer surrender charge period than Contracts issued without this rider (see 2. CHARGES AND DEDUCTIONS). If you surrender your Contract with the Premium Payment Credit Rider while subject to a surrender charge, yoursurrender value will be less than the surrender value of a Contract without this rider.

6. TRANSFERS AND SURRENDERS

Division Transfers

• You may request an unscheduled transfer or set up a scheduled transfer by

•mailing your instructions to us;

•calling us at 1-800-852-4450 (if telephone privileges apply);

•faxing your instructions to us at 1-866-894-2093; or

•visiting www.principal.com.

• You must specify the dollar amount or percentage to transfer from each division.

• The minimum transfer amount is the lesser of $100 or the value of yourdivision.

• In states where allowed, we reserve the right to reject transfer instructions from someone providing them for multiple contracts for which he or she is not the owner.

You may not make a transfer to the Fixed Account if:

• a transfer has been made from the Fixed Account to a division within six months; or

• following the transfer, the Fixed Account value would be greater than $1,000,000.

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Unscheduled Transfers

You may make unscheduled divisiontransfers from one division to another division or to the Fixed Account.

• Transfers are not permitted into DCA Plus accounts.

• Transfer values are calculated using the price next determined after we receive your request.

• We reserve the right to impose a fee of the lesser of $30 or 2% of the amount transferred on each unscheduled transfer after the first unscheduled transfer in a contract year. If we elect to begin charging for the transaction fee, we will provide you with written notice at least 30 days in advance.

Limitations on Unscheduled Transfers.We reserve the right to reject excessive exchanges or purchases if the trade would disrupt the management of the Separate Account, any division of the Separate Account or any underlying mutual fund. In addition, we may suspend or modify transfer privileges in our sole discretion at any time to prevent market timing efforts that could disadvantage other owners. These modifications could include, but not be limited to:

• requiring a minimum time period between each transfer;

• imposing the transaction fee;

• limiting the dollar amount that an owner may transfer at any one time; or

• not accepting transfer requests from someone providing requests for multiple Contracts for which he or she is not the owner.

Scheduled Transfers (Dollar Cost Averaging)

• You may elect to have transfers made on a scheduled basis.

• There is no charge for scheduled transfers and no charge for participating in the scheduled transfer program.

• You must specify the dollar amount of the transfer.

• You select the transfer date (other than the 29th, 30th or 31st) and the transfer period (monthly, quarterly, semi-annually or annually).

• If the selected date is not a valuation date, the transfer is completed on the next valuation date.

• Transfers are not permitted into DCA Plus accounts.

• If you want to stop a scheduled transfer, you must provide us notice prior to the date of the scheduled transfer.

• Transfers continue until your value in the division is zero or we receive notice to stop the transfers.

• The number of divisions available for simultaneous transfers will never be less than two. When we have more than two divisions available, we reserve the right to limit the number of divisions from which simultaneous transfers are made.

Scheduled transfers are designed to reduce the risks that result from market fluctuations. They do this by spreading out the allocation of your money to investment options over a longer period of time. This allows you to reduce the risk of investing most of your money at a time when market prices are high. The results of this strategy depend on market trends and are not guaranteed.

Example:

Month	Amount Invested	Share Price	Shares Purchased
January	$100	$25.00	4
February	$100	$20.00	5
March	$100	$20.00	5
April	$100	$10.00	10
May	$100	$25.00	4
June	$100	$20.00	5
Total	$600	$120.00	33

In the example above, the average share price is $20.00 [total of share prices ($120.00) divided by number of purchases (6)]. The average share cost is $18.18 [amount invested ($600.00) divided by number of shares purchased (33)].

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Fixed Account Transfers, Total and Partial Surrenders

Transfers and surrenders from the Fixed Account are subject to certain limitations. In addition, surrenders from the Fixed Account may be subject to a surrender charge (see Section 2. CHARGES AND DEDUCTIONS).

You may transfer amounts from the Fixed Account to the Separate Account divisions before the annuitization date and as provided below. The transfer is effective on the valuation date following our receipt of your instructions. You may transfer amounts on either a scheduled or unscheduled basis. You may not make both scheduled and unscheduled Fixed Accounttransfers in the same contract year.

Unscheduled Fixed Account Transfers. The minimum transfer amount is $100 (or entire Fixed Accountvalue if less than $100). Once per contract year, within the 30 days following the Contract anniversary date, you can:

• transfer an amount not to exceed 25% of yourFixed Accountvalue; or

• transfer up to 100% of yourFixed Account value if:

•yourFixed Accountvalue is less than $1,000; or

•a minus b is greater than 1% where:

a = the weighted average of yourFixed Account interest rates for the preceding contract year; and

b = the renewal interest rate for the Fixed Account.

Scheduled Fixed Account Transfers (Fixed Account Dollar Cost Averaging). You may make scheduled transfers on a monthly basis from the Fixed Account to the Separate Account as follows:

• You may establish scheduled transfers by sending a written request or by telephoning the home office at 1-800-852-4450.

• Transfers occur on a date you specify (other than the 29th, 30th or 31st of any month).

• If the selected date is not a valuation date, the transfer is completed on the next valuation date.

• Scheduled transfers are only available if the Fixed Accountvalue is $5,000 or more at the time the scheduled transfers begin.

• Scheduled monthly transfers of a specified dollar amount will continue until the Fixed Account value is zero or until you notify us to discontinue the transfers. This specified dollar amount cannot exceed 2% of yourFixed Accountvalue.

• The minimum transfer amount is $100.

• If the Fixed Accountvalue is less than $100 at the time of transfer, the entire Fixed Account value will be transferred.

• If you stop the transfers, you may not start transfers again without our prior approval.

Automatic Portfolio Rebalancing (APR)

• APR allows you to maintain a specific percentage of yourSeparate Account division value in specified divisions over time.

• You may elect APR at any time after the examination offer period has expired.

• APR is not available for values in the Fixed Account or the DCA Plus accounts.

• APR is not available if you have arranged scheduled transfers from the same division.

• There is no charge for APRtransfers and no charge for participating in the APR program.

• APR will be done on the frequency you specify:

•quarterly (on a calendar year or contract year basis); or

•semiannually or annually (on a contract year basis).

• You may rebalance by

•mailing your instructions to us;

•calling us at 1-800-852-4450 (if telephone privileges apply);

•faxing your instructions to us at 1-866-894-2093; or

•visiting www.principal.com.

• Divisions are rebalanced at the end of the next valuation period following your request.

Example: You elect APR to maintain your Separate Account division value with 50% in the Equity Income division and 50% in the Real Estate Securities division . At the end of the specified period, 60% of the accumulated value is in the Equity Income division , with the remaining 40% in the Real Estate Securities division . By rebalancing, unit s from the Equity Income division are redeemed and applied to the Real Estate Securities division so that 50% of the Separate Account division value is once again in each division .

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Surrenders

You may surrender your Contract by providing us notice. Surrender requests may be sent to us at:

Principal Life Insurance Company

P O Box 9382

Des Moines, Iowa 50306-9382

Surrenders result in the redemption of units and your receipt of the value of the redeemed units minus any applicable surrender charge and fees. Surrender values are calculated using the price next determined after we receive your request. Surrenders from the Separate Account are generally paid within seven days of the effective date of the request for surrender (or earlier if required by law). However, certain delays in payment are permitted (see 9. ADDITIONAL INFORMATION ABOUT THE CONTRACT). Surrenders before age 59½ may involve an income tax penalty (see 10. FEDERAL TAX MATTERS).

You may specify surrender allocation percentages with each partial surrender request. If you do not provide us with specific percentages, we will use yourpremium payment allocation percentages for the partial surrender. Surrenders may be subject to a surrender charge (see 2. CHARGES AND DEDUCTIONS).

Total Surrender

• You may surrender the Contract at any time before the annuitization date.

• Surrender values are calculated using the price next determined after we receive your request.

• The cash surrender value is youraccumulated value minus any applicable surrender charges and fee(s) (Contract fee and/or prorated share of the charge(s) for optional rider(s)).

• We reserve the right to require you to return the Contract.

The written consent of all collateral assignees and irrevocable beneficiaries must be obtained prior to surrender. A collateral assignment is an agreement under which you assign the annuity benefits to a lender as collateral for a loan. An irrevocable beneficiary is someone whose name cannot be removed from this annuity contract without his or her consent.

Unscheduled Partial Surrender

• You may surrender a part of youraccumulated value at any time before the annuitization date.

• You must specify the dollar amount of the surrender (which must be at least $100).

• The surrender is effective at the end of the valuation period during which we receive your written request for surrender.

• The surrender is deducted from yourinvestment options according to your surrender allocation percentages.

• If surrender allocation percentages are not specified, we use yourpremium payment allocation percentages.

• We surrender units from yourinvestment options to equal the dollar amount of the surrender request plus any applicable surrender charge and transaction fee, if any.

• Youraccumulated value after the unscheduled partial surrender must be equal to or greater than $5,000; we reserve the right to increase this amount up to and including $10,000.

The written consent of all collateral assignees and irrevocable beneficiaries must be obtained prior to surrender.

Scheduled Partial Surrender

• You may elect partial surrenders from any of yourinvestment options on a scheduled basis.

• Youraccumulated value must be at least $5,000 when the scheduled partial surrenders begin.

• You may specify monthly, quarterly, semi-annually or annually and choose a surrender date (other than the 29th, 30th or 31st).

• If the selected date is not a valuation date, the partial surrender is completed on the next valuation date.

• All scheduled withdrawals (scheduled partial surrenders) occurring on the Contract anniversary are reflected in the values for the prior contract year.

• We surrender units from yourinvestment options to equal the dollar amount of the partial surrender request plus any applicable partial surrender charge.

• The partial surrenders continue until your value in the investment option is zero or we receive written notice to stop the partial surrenders.

The written consent of all collateral assignees and irrevocable beneficiaries must be obtained prior to partial surrender.

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7. THE ANNUITIZATION PERIOD

Annuitization Date

You may specify an annuitization date in your application. You may change the annuitization date with our prior approval. The request must be in writing. You may not select an annuitization date prior to the first Contract anniversary or after the maximum annuitization date (age 95; state variations may apply) found on the data page. If you do not specify an annuitization date, the annuitization date is the maximum annuitization date shown on the data page.

Full Annuitization

Any time after the first contract year, you may annuitize your Contract by electing to receive payments under an annuity benefit payment option. If the accumulated value on the annuitization date is less than $2,000 or if the amount applied under an annuity benefit payment option is less than the minimum requirement, we may pay out the entire amount in a single payment. The Contract would then be canceled. You may select when you want the payments to begin (within the period that begins the business day following our receipt of your instruction and ends one year after our receipt of your instructions).

Once payments begin under the annuity benefit payment option you choose, the option may not be changed. In addition, once payments begin, you may not surrender or otherwise liquidate or commute any of the portion of youraccumulated value that has been annuitized.

Depending on the type of annuity benefit payment option selected, payments that are initiated either before or after the annuitization date may be subject to penalty taxes (see 10. FEDERAL TAX MATTERS). You should consider this carefully when you select or change the annuity benefit payment commencement date.

Partial Annuitization

If your Contract was issued on or after the later of May 20, 2006, or the date on which the issue state approved the partial annuitization endorsement, you have the right to partially annuitize a portion of youraccumulated value. If your Contract was issued prior to May 20, 2006, or prior to the date the issue state approved the partial annuitization endorsement, partial annuitization is not available and all references to “partial annuitization” within this prospectus do not apply to your Contract. A full list of states in which partial annuitization is available may be obtained from your registered representative or by calling us at 1-800-852-4450.

After the first contract year and prior to the annuitization date, you may annuitize a portion of youraccumulated value by sending us a notice.

If you have elected the Premium Payment Credit Rider, the amount of the partial annuitization during each of contract years two and three is limited to no more than 10% of the accumulated value as of the most recent Contract anniversary.

The minimum partial annuitization amount is $2,000. Any partial annuitization request that reduces the accumulated value to less than $5,000 will be treated as a request for full annuitization.

You may select one of the annuity benefit payment options listed below. Once payments begin under the option you selected, the option may not be changed. In addition, once payments begin you may not surrender or otherwise liquidate or commute any portion of youraccumulated value that has been annuitized.

Annuity Benefit Payment Options

We offer fixed annuity benefit payments only. No surrender charge is imposed on any portion of youraccumulated value that has been annuitized.

You may choose from several fixed annuity benefit payment options. Payments will be made on the frequency you choose. You may elect to have your annuity benefit payments made on a monthly, quarterly, semiannual or annual basis. The dollar amount of the payments is specified for the entire payment period according to the option selected. There is no right to take any total or partial surrenders after the annuitization date. The fixed annuity benefit payment must begin within one year of the annuity benefit election.

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The amount of the fixed annuity benefit payment depends on the:

• amount of accumulated value applied to the annuity benefit payment option;

• annuity benefit payment option selected; and

• age and gender of the annuitant (unless fixed income option is selected).

The amount of the initial payment is determined by applying all or a portion of the accumulated value as of the date of the application to the annuity table for the annuitant’s annuity benefit payment option, gender, and age. The annuity benefit payment tables contained in the Contract are based on the Annuity 2000 Mortality Table. These tables are guaranteed for the life of the Contract.

Annuity benefit payments generally are higher for male annuitants than for female annuitants with an otherwise identical Contract. This is because statistically females have longer life expectancies than males. In certain states, this difference may not be taken into consideration in determining the payment amount. Additionally, Contracts with no gender distinctions are made available for certain employer-sponsored plans because, under most such plans, gender discrimination is prohibited by law.

You may select an annuity benefit payment option by written request only. Your selection of an annuity benefit payment option for a partial annuitization must be in writing and may not be changed after payments begin. Your selection of an annuity benefit payment option for any portion not previously annuitized may be changed by written request prior to the annuitization date.

If an annuity benefit payment option is not selected, we will automatically apply:

• for Contracts with one annuitant — Life Income with payments guaranteed for a period of 10 years.

• for Contracts with joint annuitants — Joint and Full Survivor Life Income with payments guaranteed for a period of 10 years.

The available annuity benefit payment options for both full and partial annuitizations include:

• Fixed Period Income – Level payments continue for a fixed period. You may select a range from 5 to 30 years (state variations may apply). If the annuitant dies before the selected period expires, payments continue to you or the person(s) you designate until the end of the fixed period. If a shorter period is required by law, we will pay a commuted value at the end of that shorter period. Payments stop after all guaranteed payments are received.

• Life Income – Level payments continue for the annuitant’s lifetime. If you defer the first payment date, it is possible that you would receive no payments if the annuitant dies before the first payment date. NOTE: There is no death benefit value remaining and there are no further payments when the annuitant dies.

• Life Income with Period Certain – Level payments continue during the annuitant ’s lifetime with a guaranteed payment period of 5 to 30 years. If the annuitant dies before all of the guaranteed payments have been made, the guaranteed payments continue to you or the person(s) you designate until the end of the guaranteed payment period. If a shorter period is required by law, we will pay a commuted value at the end of that shorter period.

• Joint and Survivor– Payments continue as long as either the annuitant or the joint annuitant is alive. You may also choose an option that lowers the amount of income after the death of a joint annuitant. It is possible that you would only receive one payment under this option if both annuitants die before the second payment is due. If you defer the first payment date, it is possible that you would receive no payments if both the annuitants die before the first payment date. NOTE: There is no death benefit value remaining and there are no further payments after both annuitants die.

• Joint and Survivor with Period Certain – Payments continue as long as either the annuitant or the joint annuitant is alive with a guaranteed payment period of 5 to 30 years. You may choose an option that lowers the amount of income after the death of a joint annuitant . If both annuitant s die before all guaranteed payments have been made, the guaranteed payments continue to you or the person(s) you designate until the end of the guaranteed payment period. If a shorter period is required by law, we will pay a commuted value at the end of that shorter period.

Other annuity benefit payment options may be available.

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Tax Considerations Regarding Annuity Benefit Payment Options

If you own one or more tax qualified annuity contracts, you may avoid tax penalties if payments from at least one of your tax qualified contracts begin no later than April 1 following the calendar year in which you turn age 72. The required minimum distribution payment must be in equal (or substantially equal) amounts over your life or over the joint lives of you and your designated beneficiary. These required minimum distribution payments must be made at least once a year. Tax penalties may apply at your death on certain excess accumulations. You should confer with your tax advisor about any potential tax penalties before you select an annuity benefit payment option or take other distributions from the Contract. Additional rules apply to distributions under non-qualified contracts (see 10. FEDERAL TAX MATTERS ).

8. Death Benefit

This Contract provides a death benefit upon the death of the owner. The Contract will not provide death benefits upon the death of an annuitant unless the annuitant is also an owner or the owner is not a natural person.

The following tables illustrate the various situations and the resulting death benefit payment if death occurs before the annuitization date.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The beneficiary(ies) receives the death benefit under the Contract. If a beneficiary dies before you, upon your death we will make equal payments to the surviving beneficiaries unless you provided us with other written instructions. If no beneficiary(ies) survives you, the death benefit is paid to your estate in a single payment. Upon your death, only your beneficiary’s(ies’) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may either a. continue the Contract; or b. receive the death benefit under the Contract. All other beneficiaries receive the death benefit under the Contract. If a beneficiary dies before you, upon your death we will make equal payments to the surviving beneficiaries unless you provided us with other written instructions. If no beneficiary(ies) survives you, the death benefit is paid to your estate in a single payment. Unless your spouse elects to continue the Contract, only your spouse’s and any other beneficiary’s(ies’) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.
You are a joint owner	The surviving joint owner is not your spouse	The surviving owner receives the death benefit under the Contract. Upon your death, only the surviving owner’s right to the death benefit will continue; all other rights and benefits under the Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may either a. continue the Contract; or b. receive the death benefit under the Contract. Unless your surviving spouse owner elects to continue the Contract, upon your death, only your spouse’s right to the death benefit will continue; all other rights and benefits under the rider and the Contract will terminate.

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If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receives the death benefit under the Contract. If a beneficiary dies before the annuitant, upon the annuitant’s death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. Upon the annuitant’s death, only the beneficiary’s(ies’) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

Before the annuitization date, you may give us written instructions for payment under a death benefit option. If we do not receive your instructions, the death benefit is paid according to instructions from the beneficiary(ies). The beneficiary(ies) may elect to apply the death benefit under an annuity benefit payment option or receive the death benefit as a single payment. Generally, unless the beneficiary(ies) elects otherwise, we pay the death benefit in a single payment, subject to proof of your death.

No surrender charge applies when a death benefit is paid.

Death of Annuitant (During the Annuitization Period)

If the annuitant dies during the annuity benefit payment period, remaining payments are made to the owner throughout the guaranteed payment period, if any, or for the life of any joint annuitant , if any. If the owner is the annuitant , remaining payments are made to the joint owner , if any, or the named beneficiaries. In all cases the person entitled to receive payments also receives any rights and privileges under the annuity benefit payment option.

Standard Death Benefit Formula

The amount of the standard death benefit is the greatest of a, b or c, where:

a = the accumulated value on the date we receive proof of death and all required documents;

b = the total of premium payments minus an adjustment for each partial surrender (and any applicable surrender charges and fees) and minus an adjustment for each partial annuitization made prior to the date we receive proof of death and all required documents; and

c = the highest accumulated value on any Contract anniversary that is wholly divisible by seven (for example, Contract anniversaries 7, 14, 21, 28, etc.) plus any premium payments since that Contract anniversary and minus an adjustment for each partial surrender (and any applicable surrender charges and fees) and minus an adjustment for each partial annuitization made after that Contract anniversary.

The adjustment for each partial surrender (and any applicable surrender charges and fees) and for each partial annuitization made prior to the date we receive proof of death and all required documents is equal to (x divided by y) multiplied by z, where:

x = the amount of the partial surrender (and any applicable surrender charges and fees) or the amount of the partial annuitization; and

y = the accumulated value immediately prior to the partial surrender or partial annuitization; and

z = the amounts determined in b or c above immediately prior to the partial surrender or partial annuitization.

Example: Youraccumulated value is $10,000 and you take a partial surrender of $2,000 (20% of youraccumulated value). For purposes of calculating the death benefit, we reduce the amounts determined in b or c above by 20%.

Enhanced Death Benefit

For rider applications signed on or after January 4, 2010, the Enhanced Death Benefit Rider is not available. For rider applications signed prior to January 4, 2010 (Contracts with the Enhanced Death Benefit Rider), see APPENDIX H for more information.

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Payment of Death Benefit

The death benefit is usually paid within five business days of our receiving all required documents (including proof of death) to process the claim. Payment is made according to benefit instructions provided by you. Some states require this payment to be made in less than five business days. Under certain circumstances, this payment may be delayed (see 9. ADDITIONAL INFORMATION ABOUT THE CONTRACT).

NOTE: Proof of death includes: a certified copy of a death certificate; a certified copy of a court order; a written statement by a medical doctor; or other proof satisfactory to us.

The accumulated value remains invested in the divisions until the valuation period during which we receive the required documents. If more than one beneficiary is named, each beneficiary’s portion of the death benefit remains invested in the divisions until the valuation period during which we receive the required documents for that beneficiary. Unless otherwise required by law, we pay interest on the death benefit from the first day the accumulated value is no longer invested in the divisions until payment is made. After payment of all of the death benefit (including any applicable interest), the Contract is terminated.

9. ADDITIONAL INFORMATION ABOUT THE CONTRACT

The Contract

The entire Contract is made up of the Contract, amendments, riders and endorsements and data page. Only our corporate officers can agree to change or waive any provisions of a Contract. Any change or waiver must be in writing and signed by an officer of the Company.

Delay of Payments

Surrendered amounts are generally disbursed within seven calendar days after we receive your instruction for a surrender in a form acceptable to us. This period may be shorter where required by law. However, payment of any amount upon total or partial surrender, death, annuitization of the accumulated value or the transfer to or from a division may be deferred during any period when the right to sell mutual fund shares is suspended as permitted under provisions of the Investment Company Act of 1940 (as amended).

The right to sell shares may be suspended during any period when:

• trading on the NYSE is restricted as determined by the SEC or when the NYSE is closed for other than weekends and holidays; or

• an emergency exists, as determined by the SEC, as a result of which:

• disposal by a mutual fund of securities owned by it is not reasonably practicable;

• it is not reasonably practicable for a mutual fund to fairly determine the value of its net assets; or

• the SEC permits suspension for the protection of security holders.

If payments are delayed the transfer will be processed on the first valuation date following the expiration of the permitted delay unless we receive your written instructions to cancel your surrender, annuitization, or transfer. Your written instruction must be received in the home office prior to the expiration of the permitted delay. The transaction will be completed within seven business days following the expiration of a permitted delay.

In addition, we reserve the right to defer payment of that portion of youraccumulated value that is attributable to a premium payment made by check for a reasonable period of time (not to exceed 15 business days) to allow the check to clear the banking system.

We may also defer payment of surrender proceeds payable out of the Fixed Account for a period of up to six months.

Misstatement of Age or Gender

If the age or, where applicable, gender of the annuitant has been misstated, we adjust the annuity benefit payment under your Contract to reflect the amount that would have been payable at the correct age and gender. If we make any overpayment because of incorrect information about age or gender, or any error or miscalculation, we deduct the overpayment from the next payment or payments due. Underpayments are added to the next payment.

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Assignment

If your Contract is part of yourqualified plan, IRA, SEP, or SIMPLE-IRA, you may not assign ownership.

You may assign ownership of yournon-qualified contract. Each assignment is subject to any payments made or action taken by the Company prior to our notification of the assignment. We assume no responsibility for the validity of any assignment. An assignment or pledge of a Contract may have adverse tax consequences.

An assignment must be made in writing and filed with us at our home office. The irrevocable beneficiary(ies), if any, must authorize any assignment in writing. Your rights, as well as those of the annuitant and beneficiary, are subject to any assignment on file with us. Any amount paid to an assignee is treated as a partial surrender and is paid in a single payment.

The Company may refuse any assignment or transfer at any time on a non-discriminatory basis and may refuse any assignment where it believes such assignment may cause the development of a trading market.

If your Contract has a GMWB rider, an assignment of the Contract shall be deemed a request for a change in a covered life. If the change in covered life is not permissible under this rider, the rider will be terminated as of the date of the assignment. See 4. LIVING BENEFIT – GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB).

Change of Owner or Annuitant

If your Contract is part of yourqualified plan, IRA, SEP, or SIMPLE-IRA you may not change either the owner or the annuitant.

You may change the owner and/or annuitant of yournon-qualified contract at any time. Your request must be in writing and approved by us. After approval, the change is effective as of the date you signed the request for change. If ownership is changed, the benefits under certain riders may be affected. We reserve the right to require that you send us the Contract so that we can record the change.

If an annuitant who is not an owner dies while the Contract is in force, a new annuitant may be named unless the owner is a corporation, trust or other entity.

If your Contract has a GMWB rider, any ownership change before the annuitization date which would cause a change in the covered life will result in termination of this rider except in certain circumstances. See 4. LIVING BENEFIT – GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB).

Beneficiary

While this Contract is in force, you have the right to name or change a beneficiary. This may be done as part of the application process or by sending us a written request. Unless you have named an irrevocable beneficiary, you may change your beneficiary designation by sending us notice.

If your Contract has a GMWB rider, any beneficiary change before the annuitization date which would cause a change in the covered life will result in termination of this rider except in certain circumstances. See 4. LIVING BENEFIT – GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB).

Contract Termination

We reserve the right to terminate the Contract and make a single payment (without imposing any charges) to you if youraccumulated value at the end of the accumulation period is less than $2,000, unless you have the GMWB rider. Before the Contract is terminated, we will send you a notice to increase the accumulated value to $2,000 within 60 days. Termination of the Contracts will not unfairly discriminate against any owner.

Reinstatement

Reinstatement is only available for full surrender of your Contract. You cannot reinstate a partial surrender or partial annuitization; if you return either of these amounts, they will be considered new premium payments.

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If you have requested to replace this Contract with an annuity contract from another company and want to reinstate this Contract, the following apply:

• we reinstate the Contract effective on the original surrender date;

• if you had the Premium Payment Credit Rider on the original Contract, the 9-year surrender charge period applies to the reinstated Contract. The remaining surrender charge period, if any, is calculated based on the number of years since the original contract date;

• we apply the amount received from the other company (“reinstatement amount”) and the amount of the surrender chargeyou paid when you surrendered the Contract ;

• these amounts are priced on the valuation date the money from the other company is received by us;

• commissions are not paid on the reinstatement amounts; and

• new data page is sent to your address of record.

If you have any of the optional riders, rider fees will apply for the period between the date you requested termination and the date your Contract was reinstated.

If you have any of the optional riders, rider benefits will be adjusted when the amount originally surrendered differs from the reinstatement amount.

Reports

We will mail to you a statement, along with any reports required by state law, of your current accumulated value at least once per year prior to the annuitization date. After the annuitization date, any reports will be mailed to the person receiving the annuity benefit payments.

Quarterly statements reflect purchases and redemptions occurring during the quarter as well as the balance of units owned and accumulated values.

Important Information About Customer Identification Procedures

To help the government fight the funding of terrorism and money laundering activities, Federal law requires financial institutions to obtain, verify, and record information that identifies each person who applies for a Contract. When you apply for a Contract, we will ask for your name, address, date of birth, and other information that will allow us to verify your identity. We may also ask to see your driver’s license or other identifying documents.

If concerns arise with verification of your identification, no transactions will be permitted while we attempt to reconcile the concerns. If we are unable to verify your identity within 30 days of our receipt of your original premium payment, the Contract will be terminated and any value surrendered in accordance with normal redemption procedures. We will not suspend your right of full redemption, or postpone the date of payment upon redemption except as permitted by Section 22(e) of the Investment Act of 1940 or as amended.

We do not knowingly sell annuities that are for the benefit of a business/organization that is illegal under Federal and/or State law (such as a marijuana clinic), or a person who owns or receives income from such an entity or whose source of funds is illegal.

Frequent Trading and Market-Timing (Abusive Trading Practices)

This Contract is not designed for frequent trading or market timing activity of the investment options. If you intend to trade frequently and/or use market timing investment strategies, you should not purchase this Contract. The Company does not accommodate market timing.

We consider frequent trading and market timing activities to be abusive trading practices because they:

• Disrupt the management of the underlying mutual funds by:

• forcing the fund to hold short-term (liquid) assets rather than investing for long term growth, which results in lost investment opportunities for the fund; and

• causing unplanned portfolio turnover;

• Hurt the portfolio performance of the underlying mutual funds; and

• Increase expenses of the underlying mutual fund and separate account due to:

• increased broker-dealer commissions; and

• increased record keeping and related costs.

If we are not able to identify such abusive trading practices, the abuses described above will negatively impact the Contract and cause investors to suffer the harms described.

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We have adopted policies and procedures to help us identify and prevent abusive trading practices. In addition, the underlying mutual funds monitor trading activity to identify and take action against abuses. While our policies and procedures are designed to identify and protect against abusive trading practices, there can be no certainty that we will identify and prevent abusive trading in all instances. When we do identify abusive trading, we will apply our policies and procedures in a fair and uniform manner.

If we, or an underlying mutual fund that is an investment option with the Contract, deem abusive trading practices to be occurring, we will take action that may include, but is not limited to:

• Rejecting transfer instructions from a Contract owner or other person authorized by the owner to direct transfers;

• Restricting submission of transfer requests by, for example, allowing transfer requests to be submitted by 1st class U.S. mail only and disallowing requests made via the internet, by facsimile, by overnight courier or by telephone;

• Limiting the number of unscheduled transfers during a contract year to no more than 12;

• Prohibiting you from requesting a transfer among the divisions for a minimum of thirty days where there is evidence of at least one round-trip transaction (exchange or redemption of shares that were purchased within 30 days of the exchange/redemption) by you; and

• Taking such other action as directed by the underlying mutual fund.

We support the underlying mutual funds right to accept, reject or restrict, without prior written notice, any transfer requests into a fund.

In some instances, a transfer may be completed prior to a determination of abusive trading. In those instances, we will reverse the transfer (within two business days of the transfer) and return the Contract to the investment option holdings it had prior to the transfer. We will give younotice in writing in this instance.

Distribution of the Contract

The Company has appointed Principal Securities, Inc. ("PSI") (Des Moines, Iowa 50392-0200), a broker-dealer registered under the Securities Exchange Act of 1934, a member of the Financial Industry Regulatory Authority and affiliate of the Company, as the distributor and principal underwriter of the Contract. PSI is paid 6.50% of premium payments by the Company for the distribution of the Contract. PSI also receives 12b-1 fees in connection with purchases and sales of certain mutual funds underlying the Contracts. PSI currently receives 12b-1 fees for the Diversified Balanced Managed Volatility Account, Diversified Growth Managed Volatility Account, Diversified Balanced Account, Diversified Growth Account, and Diversified Income Account.

PSI is an affiliate of the Company. Both PSI and the Company are subsidiaries of Principal Financial Services, Inc.

Applications for the Contracts are solicited by registered representatives of PSI or such other broker-dealers as have entered into selling agreements with PSI. Such registered representatives act as appointed agents of the Company under applicable state insurance law and must be licensed to sell variable insurance products.

The distributor and/or its affiliates provide services to and/or funding vehicles for retirement plans and employer sponsored benefit programs. The distributor and its affiliates may pay a bonus or other consideration or incentive to intermediaries if a participant in such a retirement plan establishes a rollover individual retirement account with the assistance of a registered representative of an affiliate of distributor, if the intermediary sold the funding vehicle the retirement plan utilizes or if the intermediary subsequently became the broker of record with regard to the retirement plan. The distributor and its affiliates may pay a bonus or other consideration or incentive to intermediaries if an employee covered under an employer sponsored benefit program purchases a product from an affiliate of distributor with the assistance of a registered representative of an affiliate of distributor, if the intermediary sold the funding vehicle the employer sponsored benefit program utilizes or if the intermediary subsequently became the broker of record with regard to the employer sponsored benefit program.

The intermediary may pay to its financial professionals some or all of the amounts the distributor and its affiliates pay to the intermediary.

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Performance Calculation

The Separate Account may publish advertisements containing information (including graphs, charts, tables and examples) about the hypothetical performance of its divisions for this Contract as if the Contract had been issued on or after the date the underlying mutual fund in which the division invests was first offered. The hypothetical performance from the date of the inception of the underlying mutual fund in which the division invests is calculated by reducing the actual performance of the underlying mutual fund by the fees and charges of this Contract as if it had been in existence.

The yield and total return figures described below vary depending upon market conditions, composition of the underlying mutual fund’s portfolios and operating expenses. These factors and possible differences in the methods used in calculating yield and total return should be considered when comparing the Separate Account performance figures to performance figures published for other investment vehicles. The Separate Account may also quote rankings, yields or returns as published by independent statistical services or publishers and information regarding performance of certain market indices. Any performance data quoted for the Separate Account represents only historical performance and is not intended to indicate future performance. For further information on how the Separate Account calculates yield and total return figures, see the SAI.

From time to time the Separate Account advertises its Money Market division’s “yield” and “effective yield” for these Contracts. Both yield figures are based on historical earnings and are not intended to indicate future performance. The “yield” of the division refers to the income generated by an investment in the division over a 7-day period (which period is stated in the advertisement). This income is then “annualized.” That is, the amount of income generated by the investment during that week is assumed to be generated each week over a 52-week period and is shown as a percentage of the investment. The “effective yield” is calculated similarly but, when annualized, the income earned by an investment in the division is assumed to be reinvested. The “effective yield” is slightly higher than the “yield” because of the compounding effect of the assumed reinvestment.

The Separate Account also advertises the average annual total return of its various divisions. The average annual total return for any of the divisions is computed by calculating the average annual compounded rate of return over the stated period that would equate an initial $1,000 investment to the ending redeemable accumulated value.

10. FEDERAL TAX MATTERS

The following description is a general summary of the tax rules, primarily related to federal income taxes, which in our opinion are currently in effect. These rules are based on laws, regulations and interpretations which are subject to change at any time. This summary is not comprehensive and is not intended as tax advice. Federal estate and gift tax considerations, as well as state and local taxes, may also be material. You should consult a tax advisor about the tax implications of taking action under a Contract or related retirement plan.

Taxation of Non-Qualified Contracts

Non-Qualified Contracts

Section 72 of the Internal Revenue Code (Code) governs the income taxation of annuities in general.

• Premium payments made under non-qualified contracts are not excludable or deductible from your gross income or any other person’s gross income.

• An increase in the accumulated value of a non-qualified contract owned by a natural person resulting from the investment performance of the Separate Account or interest credited to the DCA Plus accounts and the Fixed Account is generally not taxable until paid out as surrender proceeds, death benefit proceeds, or otherwise.

• Generally, owners who are non-natural persons are immediately taxed on any increase in the accumulated value unless the non-natural person is acting as an agent for a natural person.

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The following discussion applies generally to Contracts owned by natural persons.

• Surrenders or partial surrenders are taxed as ordinary income to the extent of the accumulated income or gain under the Contract.

• The value of the Contract pledged or assigned is taxed as ordinary income to the same extent as a partial surrender.

• Annuity benefit payments:

• The basic rule for taxing annuity benefit payments is that part of each annuity benefit payment is considered a nontaxable return of the investment in the Contract and part is considered taxable income. An “exclusion ratio” is applied to each annuity benefit payment to determine how much of the payment is excludable from gross income. The remainder of the annuity benefit payment is includable in gross income for the year received.

• The “investment in the Contract” is generally the total of the premium payments made less any tax-free return of premiums.

• After the investment in the Contract is paid out, the full amount of any annuity benefit payment is taxable.

For purposes of determining the amount of taxable income resulting from distributions, all Contracts and other annuity contracts issued by us or our affiliates to the same owner within the same calendar year are treated as if they are a single contract.

Transfer of ownership may have tax consequences to the owner. For owners who are non-natural persons changing the annuitant may have tax consequences to the owner. Please consult with your tax advisor before changing the owner or annuitant on your Contract.

Required Distributions for Non-Qualified Contracts

In order for a non-qualified contract to be treated as an annuity contract for federal income tax purposes, the Code requires:

• If the person receiving payments dies on or after the annuitization date but prior to the time the entire interest in the Contract has been distributed, the remaining portion of the interest is distributed at least as rapidly as under the method of distribution being used as of the date of that person’s death.

• If you die prior to the annuitization date, the entire interest in the Contract will be distributed:

•within five years after the date of your death; or

• as annuity benefit payments (or similar periodic payments) which begin within one year of your death and which are made over the life of your designated beneficiary or over a period not extending beyond the life expectancy of that beneficiary.

Generally, unless the beneficiary elects otherwise, the above requirements are satisfied prior to the annuitization date by paying the death benefit in a single payment, subject to proof of your death. The beneficiary may elect, by written request, to receive an annuity benefit payment option instead of a single payment.

If your designated beneficiary is your surviving spouse, the Contract may be continued with your spouse deemed to be the new owner for purposes of the Code. When the owner receiving payments is not a natural person, the required distributions provided for in the Code apply upon the death of the annuitant .

Early Distribution Penalty

• If you take a premature distribution from the Contract, you may incur a 10% income tax penalty, unless the distribution is:

• made on or after you reach age 59½;

• made to a beneficiary on or after your death;

• made upon your disability as defined in the Internal Revenue Code;

• part of a series of substantially equal periodic payments for the life or life expectancy of you or you and your designated beneficiary;

• made under an immediate annuity contract; or

• allocable to contributions made prior to August 14, 1982.

Tax-Free Exchanges

Under Section 1035 of the Code, the exchange of one annuity contract for another is not a taxable transaction if the same owner is on each contract in the exchange, but may be reportable to the IRS.

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Net Investment Income Tax

The Net Investment Income Tax is imposed at a rate of 3.8% on net investment income for higher tax bracket individuals.

This tax may apply to an individual’s net investment income if the individual’s modified Adjustable Gross Income exceeds $200,000 for a single filer or $250,000 for a married filing jointly filer. The tax applies to income from interest, dividends, annuities, royalties and rents not obtained in a normal trade of business. The tax may also apply to certain trusts and estates with net investment income.

Income from annuities that are part of a qualified retirement plan (as described in the following section) are not treated as investment income for the purpose of this new tax and thus are not subject to the new 3.8% rate but may be includible for purposes of determining whether the applicable Net Investment Income Tax income limits are exceeded.

Taxation of Qualified Contracts

Tax-Qualified Contracts: IRA, SEP, and SIMPLE-IRA

The Contract may be used to fund IRAs, SEPs, and SIMPLE-IRAs.

• IRA – An Individual Retirement Annuity (IRA) is a retirement savings annuity. Contributions grow tax deferred.

• SEP-IRA – SEP stands for Simplified Employee Pension and is a form of IRA. A SEP allows you, as an employer, to provide retirement benefits for your employees by contributing to their IRAs.

• SIMPLE-IRA – SIMPLE stands for Savings Incentive Match Plan for Employees. A SIMPLE-IRA allows employees to save for retirement by deferring salary on a pre-tax basis and receiving predetermined company contributions.

The tax rules applicable to owners, annuitants and other payees vary according to the type of plan and the terms and conditions of the plan itself. In general, premium payments made under a retirement program recognized under the Code are excluded from the participant’s gross income for tax purposes prior to the annuity benefit payment date (subject to applicable state law). The portion, if any, of any premium payment made that is not excluded from their gross income is their investment in the Contract. Aggregate deferrals under all plans at the employee’s option may be subject to limitations.

Tax-qualified retirement arrangements, such as IRAs, SEPs, and SIMPLE-IRAs, are tax-deferred. You derive no additional benefit from the tax deferral feature of the annuity. Consequently, an annuity should be used to fund an IRA, or other tax qualified retirement arrangement to benefit from the annuity’s features other than tax deferral. These features may include guaranteed lifetime income, death benefits without surrender charges, guaranteed caps on fees, and the ability to transfer among investment options without sales or withdrawal charges.

The tax implications of these plans are further discussed in the SAI under the heading Taxation Under Certain Retirement Plans. Check with your tax advisor for the rules which apply to your specific situation.

Premature Distributions: There is a 10% additional penalty tax under the Code on the taxable portion of a “premature distribution” from IRAs, IRA rollovers, SEP-IRAs and SIMPLE-IRAs. The tax penalty is increased to 25% in the case of distributions from SIMPLE-IRAs during the first two years of participation in the SIMPLE IRA. Generally, an amount is a “premature distribution” unless the distribution is:

• made on or after you reach age 59½;

• made to a beneficiary on or after your death;

• made upon your disability as defined in the Internal Revenue Code;

• part of a series of substantially equal periodic payments for the life or life expectancy of you or you and your designated beneficiary;

• made to pay certain deductible medical expenses;

• for health insurance premiums while unemployed;

• for first home purchases (up to $10,000);

• for qualified higher education expenses;

• for qualified disaster tax relief distributions;

• for qualified reservist distributions; or

• for amounts levied by the IRS directly against your IRA; or

• a qualified birth or adoption distribution (up to $5,000).

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For more information regarding premature distributions, please reference IRS Publication 590-B and consult your tax advisor.

Rollover IRAs

If you receive a lump-sum distribution from a qualified retirement plan, tax-sheltered annuity or governmental 457(b) plan, you may maintain the tax-deferred status of the distribution by rolling it over into an eligible retirement plan or IRA. You can accomplish this by electing a direct rollover from the plan, or you can receive the distribution and roll it over into an eligible retirement plan or IRA within 60 days. However, if you do not elect a direct rollover from the plan, the plan is required to withhold 20% of the taxable portion of the distribution. This amount is sent to the IRS as income tax withholding to be credited against your taxes. Amounts received prior to age 59½ and not rolled over may be subject to an additional 10% penalty tax. You may roll over amounts from a qualified plan directly to a Roth IRA. As part of this rollover, previously taxed deferred funds from the qualified plan are converted to after-tax funds under a Roth IRA. Generally, the entire rollover is taxable (unless it includes after-tax dollars) and is included in gross income in the year of the rollover/conversion. For more information, please consult your tax advisor.

In addition, not more frequently than once every twelve months, an owner may execute one tax-free indirect rollover from one IRA to another, subject to the 60-day limitation. The once-per-year limitation on rollovers does not apply to direct transfers of funds between IRA providers or to Roth IRA conversions. For more information, please consult your tax advisor.

Roth IRAs

The Contract may be purchased to fund a Roth IRA. Contributions to a Roth IRA are not deductible from taxable income. Subject to certain limitations, a traditional IRA, SEP-IRA or SIMPLE-IRA may be converted into a Roth IRA or a distribution from such an arrangement may be rolled over to a Roth IRA. However, a conversion or a rollover to a Roth IRA is not excludable from gross income. If certain conditions are met, qualified distributions from a Roth IRA are tax-free. For more information, please contact your tax advisor.

Required Minimum Distributions for IRAs

The Required Minimum Distribution (RMD) regulations dictate when individuals must start taking payments from their IRA. Generally speaking, RMDs for IRAs must begin no later than April 1 following the close of the calendar year in which you turn 72. Thereafter, the RMD is required no later than December 31 of each calendar year.

The RMD rules apply to traditional IRAs, as well as SEP-IRAs and SIMPLE-IRAs, during the lifetime and after the death of IRA owners. They do not, however, apply to Roth IRAs during the lifetime of the Roth IRA owner. If an individual owns more than one IRA, the RMD amount must be determined for each, but the actual distribution can be satisfied from a combination of one or more of the owner's IRAs. Roth IRAs may not be aggregated with other IRAs, but may be aggregated with other Roth IRAs.

NOTE: Contractual limitations exist that may limit the ability to satisfy an individual's multiple RMD obligations via this annuity. For details, see 4. LIVING BENEFIT – GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB) - Required Minimum Distribution (RMD) Program for GMWB Riders.

Failure to comply with the RMD rules can result in tax penalty of 50% on the amount by which the RMD in any year exceeds the amount actually distributed in that year.

Note: Required minimum distributions (RMDs) for 2020 are waived for certain defined contribution plans (including 401(k), 403(b), and governmental 457(b) plans) and IRAs. Beneficiaries receiving distributions over a 5-year period can waive the distribution for 2020 and determine the 5-year period without regard to calendar year 2020 .

Withholding

Annuity benefit payments and other amounts received under the Contract are subject to income tax withholding unless the recipient elects not to have taxes withheld. The amounts withheld vary among recipients depending on the tax status of the individual and the type of payments from which taxes are withheld.

Notwithstanding the recipient’s election, withholding may be required on payments delivered outside the United States. Moreover, special withholding rules may require us to disregard the recipient’s election if the recipient fails to supply us with a taxpayer identification number (social security number for individuals), or if the Internal Revenue Service notifies us that the taxpayer identification number provided by the recipient is incorrect.

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11. GENERAL INFORMATION ABOUT THE COMPANY

Corporate Organization and Operation

Principal Life Insurance Company

Principal Life Insurance Company is a stock life insurance company with authority to transact life and annuity business in all states of the United States and the District of Columbia. Our home office is located at: Principal Financial Group, Des Moines, Iowa 50392. We are a wholly owned subsidiary of Principal Financial Services, Inc., which in turn, is a wholly owned direct subsidiary of Principal Financial Group, Inc., a publicly-traded company.

On June 24, 1879, we were incorporated under Iowa law as a mutual assessment life insurance company named Bankers Life Association. We became a legal reserve life insurance company and changed our name to Bankers Life Company in 1911. In 1986, we changed our name to Principal Mutual Life Insurance Company. In 1998, we became Principal Life Insurance Company, a subsidiary stock life insurance company of Principal Mutual Holding Company, as part of a reorganization into a mutual insurance holding company structure. In 2001, Principal Mutual Holding Company converted to a stock company through a process called demutualization, resulting in our current organizational structure.

Principal Life Insurance Company Separate Account B

The Separate Account was established under Iowa law on January 12, 1970 and was registered as a unit investment trust with the SEC on July 17, 1970. This registration does not involve SEC supervision of the investments or investment policies of the Separate Account. We do not guarantee the investment results of the Separate Account. There is no assurance that the value of your Contract will equal the total of the payments you make to us.

The Separate Account is not affected by the rate of return of our General Account or by the investment performance of any of our other assets. Any income, gain, or loss (whether or not realized) from the assets of the Separate Account are credited to or charged against the Separate Account without regard to our other income, gains, or losses. Assets of the Separate Account attributed to the reserves and other liabilities under the Contract may not be charged with liabilities arising from any of our other businesses.

Any Contract obligations in excess of the Separate Account value (for example, annuity benefit payments, death benefit payment(s) and guaranteed minimum withdrawal benefit payments) become obligations of the General Account and will be subject to the rights of the Company’s other creditors and its overall claims paying ability.

The Separate Account is divided into divisions. The assets of each division invest in a corresponding underlying mutual fund. New divisions may be added and made available. Divisions may also be eliminated. These changes will be made in a manner that is consistent with applicable laws and regulations.

The Underlying Mutual Funds

The underlying mutual funds are registered under the Investment Company Act of 1940 as open-end investment management companies. The underlying mutual funds provide the investment vehicles for the Separate Account. A full description of the underlying mutual funds, the investment objectives, policies and restrictions, charges and expenses and other operational information are contained in the accompanying prospectuses (which should be read carefully before investing) and the Statement of Additional Information (“SAI”). You may request additional copies of these documents without charge from your registered representative or by calling us at 1-800-852-4450.

We purchase and sell shares of the underlying mutual fund for the Separate Account at their net asset value. Shares represent interests in the underlying mutual fund available for investment by the Separate Account. Each underlying mutual fund corresponds to one of the divisions. The assets of each division are separate from the others. A division’s performance has no effect on the investment performance of any other division.

The underlying mutual funds are NOT available to the general public directly. The underlying mutual funds are available only as investment options in variable life insurance policies or variable annuity contracts issued by life insurance companies and qualified plans. Some of the underlying mutual funds have been established by investment advisers that manage publicly traded mutual funds having similar names and investment objectives. While some of the underlying mutual funds may be similar to, and may in fact be modeled after publicly traded mutual funds, you should understand that the underlying mutual funds are not otherwise directly related to any publicly traded mutual fund. Consequently, the investment performance of any underlying mutual fund may differ substantially from the investment performance of a publicly traded mutual fund.

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The Table of Separate Account Divisions included later in this prospectus contains a brief summary of the investment objectives and a listing of the advisor and, if applicable, sub-advisor for each division.

Deletion or Substitution of Separate Account Divisions

We reserve the right, within the law, to make additions, deletions and substitutions for the divisions. We will make no such substitution or deletion without first notifying you and obtaining approval of the appropriate insurance regulatory authorities and the SEC (to the extent required by 1940 Act).

If the shares of a division are no longer available for investment or if, in the judgment of our management, investment in a division becomes inappropriate for the purposes of our contract, we may eliminate the shares of a division and substitute shares of another division of the Trust or another open-end registered investment company. Substitution may be made with respect to both existing investments and the investment of future premium payments.

If we eliminate divisions, you may change allocation percentages and transfer any value in an affected division to another division(s) without charge. You may exercise this exchange privilege until the later of 60 days after a) the effective date of the additions, deletions and/or substitutions of the change, or b) the date you receive notice of the options available. You may only exercise this right if you have any value in the affected division(s).

We also reserve the right to establish additional divisions, each of which would invest in a separate underlying mutual fund with a specified investment objective.

Voting Rights

We vote shares of the underlying mutual funds owned by the Separate Account according to the instructions of Contract owners.

We will notify you of shareholder meetings of the mutual funds underlying the divisions in which you hold units. We will send you proxy materials and instructions for you to provide voting instructions to us. We will arrange for the handling and tallying of proxies received from you and other owners. If you give no voting instructions, we will vote those shares in the same proportion as shares for which we received instructions. Because there is no required minimum number of votes, a small number of votes can have a disproportionate effect.

We determine the number of fund shares that you may instruct us to vote by allocating one vote for each $100 of accumulated value in the division. Fractional votes are allocated for amounts less than $100. We determine the number of underlying fund shares you may instruct us to vote as of the record date established by the underlying mutual fund for its shareholder meeting. In the event that applicable law changes or we are required by regulators to disregard voting instructions, we may decide to vote the shares of the underlying mutual funds in our own right.

Legal Opinions

Legal matters applicable to the issue and sale of the Contracts, including our right to issue Contracts under Iowa Insurance Law, have been passed upon by Doug Hodgson, Counsel.

Legal Proceedings

There are no legal proceedings pending for which the following would be adversely affected in a material way: Separate Account B, the Company; any subsidiary of the Company; principal underwriter; or depositor.

Other Variable Annuity Contracts

The Company currently offers other variable annuity contracts that participate in Separate Account B. In the future, we may designate additional group or individual variable annuity contracts as participating in Separate Account B.

Householding

To avoid sending duplicate copies of materials to owners, only one copy of the prospectus and annual and semi-annual reports for the funds will be mailed to owners having the same name and address on our records. The consolidation of these mailings, called householding, benefits us through reduced mailing expense. If you want to receive multiple copies of these materials, you may call us at 1-800-852-4450. You may also notify us in writing. Individual copies of prospectuses and reports will be sent to you within thirty (30) days after we receive your request to stop householding.

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Payments to Financial Intermediaries

The Company pays compensation to broker-dealers, financial institutions, and other parties (“Financial Intermediaries”) for the sale of the Contract according to schedules in the sales agreements and other agreements reached between the Company and the Financial Intermediaries. Such compensation generally consists of commissions on premiums paid on the Contract. The Company and/or its affiliates may also pay other amounts (“Additional Payments”) that include, but are not limited to, marketing allowances, expense reimbursements, and educational payments. These Additional Payments are designed to provide incentives for the sale of the Contracts as well as other products sold by the Company and may influence the Financial Intermediaries or their registered representatives to recommend the purchase of this Contract over competing annuity contracts or other investment products. You may ask your registered representative about these differing and divergent interests, how your registered representative is personally compensated, and how your registered representative’s broker-dealer is compensated for soliciting applications for the Contract.

We and/or our affiliates provide services to and/or funding vehicles for welfare benefit plans, retirement plans and employer sponsored benefits. We and our affiliates may pay a bonus or other consideration or incentive to brokers or dealers:

• if a participant in such a welfare benefit or retirement plan or an employee covered under an employer sponsored benefit purchases an individual product with the assistance of a registered representative of an affiliate of ours;

• if a participant in such a retirement plan establishes a rollover individual retirement account with the assistance of a registered representative of an affiliate of ours;

• if the broker or dealer sold the funding vehicle the welfare benefit or retirement plan or employer sponsored benefit utilizes; or

• based on the broker's or dealer's relationship to the welfare benefit or retirement plan or employer sponsored benefit.

The broker or dealer may pay to its financial professionals some or all of the amounts we pay to the broker or dealer.

Conflicts of Interest Related to Underlying Mutual Funds

Compensation and Underlying Mutual Fund Selection

When selecting the underlying mutual funds, we consider each such fund’s investment strategy, asset class, manager’s reputation, and performance. We also consider the amount of compensation that we receive from the underlying mutual funds, their advisers, sub-advisers, or their distributors, which can be significant. Additionally, we offer certain underlying mutual funds at least in part because they are managed by an affiliate.

Compensation We Receive from Underlying Mutual Funds

The Company and certain of our affiliates receive compensation from certain underlying mutual funds pursuant to Rule 12b-1 under the 1940 Act. This compensation is paid out of an underlying mutual fund’s assets and is as much as 0.25% of the average net assets of an underlying mutual funds that are attributable to the variable life insurance products issued by us and our affiliates that offer the particular fund (the Company’s variable contracts). An investment in an underlying mutual funds with a 12b-1 fee will increase the cost of your investment.

Compensation We Receive from Underlying Mutual Fund Advisors

We and certain of our affiliates also receive compensation from the advisers and sub-advisers to some of the underlying mutual funds. We use this compensation for such purposes as paying expenses that we incur in promoting, issuing, distributing and administering the Policy and providing services on behalf of the underlying mutual funds in our role as intermediary. Some advisers and sub-advisers pay us more than others; some advisers and sub-advisers do not pay us any such compensation. Such compensation is not reflected in an underlying mutual fund's expenses in cases where it is not paid directly out of such fund’s assets, or if it is derived, in whole or in part, from the advisory fee deducted from fund assets. Owners, through their indirect investment in the underlying mutual funds, bear the costs of these advisory fees.

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Other Conflicts of Interest

The underlying mutual funds are available to registered separate accounts offering variable annuity and variable life products of other affiliated and unaffiliated insurance companies, as well as to the separate account and other separate accounts of the Company. Although we do not anticipate any disadvantages to these arrangements, it is possible that a material conflict may arise between the interests of the separate account and one or more of the other separate accounts participating in the underlying mutual funds. A conflict may occur, for example, as a result of a change in law affecting the operations of variable life and variable annuity separate accounts, differences in the voting instructions of the owners and payees and those of other insurance companies, or some other reason. In the event of a conflict of interest, we will take steps necessary to protect owners and payees, including withdrawing the Separate Account from participation in the underlying mutual funds involved in the conflict or substituting shares of other funds.

Mutual Fund Diversification

The United States Treasury Department has adopted regulations under Section 817(h) of the Internal Revenue Code which establishes standards of diversification for the investments underlying the Contracts. Under this Internal Revenue Code Section, Separate Account investments must be adequately diversified in order for the increase in the value of non-qualified contracts to receive tax-deferred treatment. In order to be adequately diversified, the portfolio of each underlying mutual fund must, as of the end of each calendar quarter or within 30 days thereafter, have no more than 55% of its assets invested in any one investment, 70% in any two investments, 80% in any three investments and 90% in any four investments. Failure of an underlying mutual fund to meet the diversification requirements could result in tax liability to non-qualified contract holders.

The investment opportunities of the underlying mutual funds could conceivably be limited by adhering to the above diversification requirements. This would affect all owners, including owners of Contracts for whom diversification is not a requirement for tax-deferred treatment.

State Regulation

The Company is subject to the laws of the State of Iowa governing insurance companies and to regulation by the Iowa Insurance Division. An annual statement in a prescribed form must be filed by March 1 in each year covering our operations for the preceding year and our financial condition on December 31 of the prior year. Our books and assets are subject to examination by the Commissioner of Insurance of the State of Iowa, or the Commissioner’s representatives, at all times. A full examination of our operations is conducted periodically by the National Association of Insurance Commissioners. Iowa law and regulations also prescribe permissible investments, but this does not involve supervision of the investment management or policy of the Company.

In addition, we are subject to the insurance laws and regulations of other states and jurisdictions where we are licensed to operate. Generally, the insurance departments of these states and jurisdictions apply the laws of the state of domicile in determining the field of permissible investments.

Independent Registered Public Accounting Firm

The financial statements of Principal Life Insurance Company Separate Account B and the consolidated financial statements of Principal Life Insurance Company are included in the SAI. Those statements have been audited by Ernst & Young LLP, independent registered public accounting firm, 801 Grand Avenue, Suite 3000, Des Moines, Iowa 50309, for the periods indicated in their reports which also appear in the SAI.

Financial Statements

The consolidated financial statements of Principal Life Insurance Company which are included in the SAI should be considered only as they relate to our ability to meet our obligations under the Contract. They do not relate to investment performance of the assets held in the Separate Account.

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12.TABLE OF SEPARATE ACCOUNT DIVISIONS

AllianceBernstein Small Cap Growth Division (no longer available to new investors with an application signature date on or after 02/01/2013)

Invests in:	AllianceBernstein Variable Products Series Fund, Inc. – AllianceBernstein Small Cap Growth Portfolio – Class A
Investment Advisor:	AllianceBernstein L.P.
Investment Objective:	seeks long-term growth of capital.

AllianceBernstein Small/Mid Cap Value Division

Invests in:	AllianceBernstein Variable Products Series Small/Mid Cap Value Portfolio – Class A
Investment Advisor:	AllianceBernstein L.P.
Investment Objective:	seeks long-term growth of capital.

American Century VP Capital Appreciation Division (no longer available to new investors with an application signature date on or after 05/18/2013)

Invests in:	American Century VP Capital Appreciation Fund – Class I
Investment Advisor:	American Century Investment Management, Inc.
Investment Objective:	seeks capital growth.

American Century VP Inflation Protection Division

Invests in:	American Century VP Inflation Protection Fund – Class II
Investment Advisor:	American Century Investment Management, Inc.
Investment Objective:	seeks long-term total return using a strategy that seeks to protect against U.S. inflation.

American Century VP Mid Cap Value Division

Invests in:	American Century VP Mid Cap Value Fund – Class II
Investment Advisor:	American Century Investment Management, Inc.
Investment Objective:	seeks long-term capital growth. Income is a secondary objective.

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American Century VP Ultra Division

Invests in:	American Century VP Ultra Fund – Class II
Investment Advisor:	American Century Investment Management, Inc.
Investment Objective:	seeks long-term capital growth.

American Funds Insurance Series Asset Allocation Fund Division

Invests in:	American Funds Insurance Series Asset Allocation Fund – Class 2
Investment Advisor:	Capital Research and Management Company
Investment Objective:	seeks to provide you a high total return (including income and capital gains) consistent with preservation of capital over the long term.

American Funds Insurance Series Blue Chip Income and Growth Division

Invests in:	American Funds Insurance Series Blue Chip Income and Growth Fund – Class 2
Investment Advisor:	Capital Research and Management Company
Investment Objective:	seeks to produce income exceeding the average yield on U.S. stocks generally and to provide an opportunity for growth of principal consistent with sound common stock investing.

American Funds Insurance Series Global Small Capitalization Fund Division

Invests in:	American Funds Insurance Series Global Small Capitalization Fund – Class 2
Investment Advisor:	Capital Research and Management Company
Investment Objective:	seeks long-term growth of capital.

American Funds Insurance Series New World Fund Division

Invests in:	American Funds Insurance Series New World Fund – Class 2
Investment Advisor:	Capital Research and Management Company
Investment Objective:	seeks long-term capital appreciation.

BlackRock 60/40 Target Allocation ETF Division

Invests in:	BlackRock 60/40 Target Allocation ETF V.I. Fund – Class III
Investment Advisor:	BlackRock Advisors, LLC
Investment Objective:	seeks to provide total return.

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BlackRock Global Allocation Division

Invests in:	BlackRock Global Allocation V.I. Fund – Class III
Investment Advisor:	BlackRock Investment Management, LLC
Investment Objective:	seeks high total investment return.

BNY Mellon Investment Portfolio Technology Growth Division

Invests in:	BNY Mellon Investment Portfolio Technology Growth Portfolio – Service Shares
Investment Advisor:	BNY Mellon Investment Advisor, Inc.
Investment Objective:	seeks capital appreciation.

Columbia Limited Duration Credit Division

Invests in:	Columbia VP Limited Duration Credit Fund – Class 2
Investment Advisor:	Columbia Management Investment Advisors, LLC
Investment Objective:	seeks to provide shareholders with a level of current income consistent with preservation of capital.

Delaware Limited Term Diversified Income Division

Invests in:	Delaware VIP Limited Term Diversified Income Series – Service Class
Investment Advisor:	Delaware Management Company
Investment Objective:	seeks maximum return consistent with reasonable risk.

Delaware Small Cap Value Division

Invests in:	Delaware VIP Small Cap Value Series – Service Class
Investment Advisor:	Delaware Management Company
Investment Objective:	seeks capital appreciation.

DWS Small Mid Cap Value Division

Invests in:	DWS Small Mid Cap Value VIP – Class B
Investment Advisor:	DWS Investment Management Americas Inc.
Investment Objective:	seeks long-term capital appreciation.

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EQ Advisors Trust 1290 VT Convertible Securities Division

Invests in:	EQ Advisors Trust 1290 VT Convertible Securities Portfolio - Class IB
Investment Advisor:	FMG LLC
Investment Objective:	seeks a high level of total return

EQ Advisors Trust 1290 VT GAMCO Small Company Value Division

Invests in:	EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio - Class IB
Investment Advisor:	FMG LLC
Investment Objective:	seeks to achieve long-term growth of capital

EQ Advisors Trust 1290 VT Micro Cap Division

Invests in:	EQ Advisors Trust 1290 VT Micro Cap Portfolio - Class IB
Investment Advisor:	FMG LLC
Investment Objective:	seeks to achieve long-term growth of capital

EQ Advisors Trust 1290 VT SmartBeta Equity Division

Invests in:	EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio - Class IB
Investment Advisor:	FMG LLC
Investment Objective:	sees to achieve long-term capital appreciation

EQ Advisors Trust 1290 VT Socially Responsible Division

Invests in:	EQ Advisors Trust 1290 VT Socially Responsible Portfolio - Class IB
Investment Advisor:	FMG LLC
Investment Objective:	sees to achieve long-term appreciation

Fidelity VIP Contrafund^® Division

Invests in:	Fidelity VIP Contrafund® Portfolio – Service Class 2
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks long-term capital appreciation.

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Fidelity VIP Equity-Income Division

Invests in:	Fidelity VIP Equity-Income Portfolio – Service Class 2
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks reasonable income. The fund will also consider the potential for capital appreciation. The fund’s goal is to achieve a yield which exceeds the composite yield on the securities comprising the Standard & Poor’s 500(sm) Index (S&P 500®).

Fidelity VIP Government Money Market Division

Invests in:	Fidelity VIP Government Money Market Portfolio – Initial Class
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks as high a level of current income as is consistent with preservation of capital and liquidity.

Fidelity VIP Growth Division

Invests in:	Fidelity VIP Growth Portfolio – Service Class 2
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks to achieve capital appreciation.

Fidelity VIP Mid Cap Division

Invests in:	Fidelity VIP Mid Cap Portfolio – Service Class 2
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks long-term growth of capital.

Fidelity VIP Overseas Division

Invests in:	Fidelity VIP Overseas Portfolio – Service Class 2
Investment Advisor:	Fidelity Management & Research Company
Investment Objective:	seeks long-term growth of capital.

Franklin Global Real Estate VIP Division

Invests in:	Franklin Templeton VIP Trust – Franklin Global Real Estate VIP Fund – Class 2
Investment Advisor:	Franklin Templeton Institutional LLC
Investment Objective:	seeks high total return.

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Franklin Small Cap Value VIP Division

Invests in:	Franklin Templeton VIP Trust – Franklin Small Cap Value VIP Fund – Class 2
Investment Advisor:	Franklin Mutual Advisers, LLC.
Investment Objective:	seeks long-term total return.

Franklin Templeton Global Bond VIP Division

Invests in:	Franklin Templeton VIP Trust – Templeton Global Bond VIP Fund – Class 4
Investment Advisor:	Franklin Advisors, Inc.
Investment Objective:	seeks high current income, consistent with preservation of capital. Capital appreciation is a secondary consideration.

Goldman Sachs VIT Mid Cap Value Division

Invests in:	Goldman Sachs VIT – Goldman Sachs Mid Cap Value Fund – Institutional Shares
Investment Advisor:	Goldman Sachs Asset Management, L.P.
Investment Objective:	seeks long-term capital appreciation.

Goldman Sachs VIT Small Cap Equity Insights Division

Invests in:	Goldman Sachs VIT – Goldman Sachs Small Cap Equity Insights Fund – Institutional Shares
Investment Advisor:	Goldman Sachs Asset Management, L.P.
Investment Objective:	seeks long-term growth of capital.

Guggenheim Floating Rate Strategies Division

Invests in:	Guggenheim Investments VIF – Series F (Guggenheim Floating Rate Strategies Series)
Investment Advisor:	Guggenheim Partners Investment Management LLC d/b/a Guggenheim Investments
Investment Objective:	seeks to provide a high level of current income while maximizing total return.

Guggenheim Investments Global Managed Futures Strategy Division

Invests in:	Guggenheim Investments VIF Global Managed Futures Strategy Fund
Investment Advisor:	Security Investors, LLC, which operates under the name of Guggenheim Investments
Investment Objective:	seeks to generate positive returns over time.

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Guggenheim Investments Long Short Equity Division

Invests in:	Guggenheim Investments VIF Long Short Equity Fund
Investment Advisor:	Security Investors, LLC, which operates under the name of Guggenheim Investments
Investment Objective:	seeks long-term capital appreciation.

Guggenheim Investments Multi-Hedge Strategies Division

Invests in:	Guggenheim Investments VIF Multi-Hedge Strategies Fund
Investment Advisor:	Security Investors, LLC, which operates under the name of Guggenheim Investments
Investment Objective:	seeks long-term capital appreciation with less risk than traditional equity funds.

Invesco Health Care Division

Invests in:	Invesco V.I. Health Care Fund – Series I Shares
Investment Advisor:	Invesco Advisors, Inc.
Investment Objective:	seeks long-term capital growth.

Invesco International Growth Division

Invests in:	Invesco V.I. International Growth Fund – Series I Shares
Investment Advisor:	Invesco Advisors, Inc.
Investment Objective:	seeks long-term growth of capital.

Invesco Small Cap Equity Division

Invests in:	Invesco V.I. Small Cap Equity Fund – Series I Shares
Investment Advisor:	Invesco Advisors, Inc.
Investment Objective:	seeks long-term growth of capital.

Invesco Value Opportunities Division

Invests in:	Invesco V.I. Value Opportunities Division Fund – Series I Shares
Investment Advisor:	Invesco Advisors, Inc.
Investment Objective:	seeks long-term growth of capital.

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Janus Henderson Flexible Bond Division

Invests in:	Janus Henderson Series Flexible Bond Portfolio – Service Shares
Investment Advisor:	Janus Capital Management LLC
Investment Objective:	seeks to obtain maximum total return, consistent with preservation of capital.

MFS International Intrinsic Value Division

Invests in:	MFS® International IntrinsicValue Portfolio – Service Class
Investment Advisor:	Massachusetts Financial Services Company
Investment Objective:	seeks capital appreciation.

MFS New Discovery Division

Invests in:	MFS® New Discovery Series – Service Class
Investment Advisor:	Massachusetts Financial Services Company
Investment Objective:	seeks capital appreciation.

MFS Utilities Division

Invests in:	MFS® Utilities Series – Service Class
Investment Advisor:	Massachusetts Financial Services Company
Investment Objective:	seeks total return.

MFS Value Division

Invests in:	MFS® VIT Value Series – Service Class
Investment Advisor:	Massachusetts Financial Services Company
Investment Objective:	seeks capital appreciation.

Neuberger Berman AMT Mid Cap Growth Division (not available to investors with an application signature dated on or after 05/18/2013)

Invests in:	Neuberger Berman AMT Mid Cap Growth Portfolio – S Class
Investment Advisor:	Neuberger Berman Investment Advisors LLC
Investment Objective:	seeks growth of capital.

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Neuberger Berman AMT Sustainable Equity Division

Invests in:	Neuberger Berman AMT Sustainable Equity Portfolio – Class I
Investment Advisor:	Neuberger Berman Investment Advisors LLC
Investment Objective:	seeks to invest primarily in common stock of mid- to large-capitalization companies that meet the Funds' quality oriented financial and ESG criteria.

PIMCO All Asset Division

Invests in:	PIMCO VIT All Asset Portfolio – Administrative Class
Investment Advisor:	Research Affiliates, LLC through a sub-advisory agreement with Pacific Investment Management Company LLC (PIMCO)
Investment Objective:	seeks maximum real return consistent with preservation of real capital and prudent investment management.

PIMCO High Yield Division

Invests in:	PIMCO VIT High Yield Portfolio – Administrative Class
Investment Advisor:	Pacific Investment Management Company LLC
Investment Objective:	seeks maximum total return, consistent with preservation of capital and prudent investment management.

PIMCO Low Duration Division

Invests in:	PIMCO VIT Low Duration Portfolio – Advisor Class
Investment Advisor:	Pacific Investment Management Company LLC
Investment Objective:	seeks maximum total real return, consistent with preservation of capital and prudent investment management.

PIMCO Total Return Division

Invests in:	PIMCO VIT Total Return Portfolio – Administrative Class
Investment Advisor:	Pacific Investment Management Company, LLC
Investment Objective:	seeks maximum total return, consistent with preservation of capital and prudent investment management.

Core Plus Bond Division

Invests in:	Principal Variable Contracts Funds Core Plus Bond Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide current income and, as a secondary objective, capital appreciation.

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Diversified Balanced Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Diversified Balanced Account – Class 2
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide as high a level of total return (consisting of reinvested income and capital appreciation) as is consistent with reasonable risk.

Diversified Balanced Managed Volatility Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Diversified Balanced Managed Volatility Account – Class 2
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide as high a level of total return (consisting of reinvested income and capital appreciation) as is consistent with reasonable risk, with an emphasis on managing volatility.

Diversified Growth Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Diversified Growth Account – Class 2
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide long-term capital appreciation.

Diversified Growth Managed Volatility Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Diversified Growth Managed Volatility Account – Class 2
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide long-term capital appreciation, with an emphasis on managing volatility.

Diversified Income Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Diversified Income Account – Class 2
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide as high a level of total return (consisting of reinvested income and capital appreciation) as is consistent with reasonable risk.

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Diversified International Division

Invests in:	Principal Variable Contracts Funds Diversified International Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

Equity Income Division

Invests in:	Principal Variable Contracts Funds Equity Income Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide a relatively high level of current income and long-term growth of income and capital.

Government & High Quality Bond Division

Invests in:	Principal Variable Contracts Funds Government & High Quality Bond Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a high level of current income consistent with safety and liquidity.

International Emerging Markets Division

Invests in:	Principal Variable Contracts Funds International Emerging Markets Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

LargeCap Growth I Division

Invests in:	Principal Variable Contracts Funds LargeCap Growth Account I – Class 1
Investment Advisor:	T. Rowe Price Associates through a sub-advisory agreement and Brown Investment Advisory Incorporated through a sub-advisory agreement with Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

LargeCap S&P 500 Index Division

Invests in:	Principal Variable Contracts Funds LargeCap S&P 500 Index Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

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MidCap Division

Invests in:	Principal Variable Contracts Funds MidCap Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

Principal Capital Appreciation Division

Invests in:	Principal Variable Contracts Funds Principal Capital Appreciation Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide long-term growth capital.

Principal LifeTime 2010 Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime 2010 Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a total return consisting of long-term growth of capital and current income.

Principal LifeTime 2020 Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime 2020 Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a total return consisting of long-term growth of capital and current income.

Principal LifeTime 2030 Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime 2030 Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a total return consisting of long-term growth of capital and current income.

Principal LifeTime 2040 Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime 2040 Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a total return consisting of long-term growth of capital and current income.

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Principal LifeTime 2050 Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime 2050 Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks a total return consisting of long-term growth of capital and current income.

Principal LifeTime Strategic Income Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Principal LifeTime Strategic Income Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks current income, and as a secondary objective, capital appreciation.

Real Estate Securities Division

Invests in:	Principal Variable Contracts Funds Real Estate Securities Account – Class 1
Investment Advisor:	Principal Real Estate Investors, LLC through a sub-advisory agreement with Principal Global Investors, LLC
Investment Objective:	seeks to generate a total return.

Short-Term Income Division

Invests in:	Principal Variable Contracts Funds Short-Term Income Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide as high a level of current income as is consistent with prudent investment management and stability of principal.

SmallCap Division

Invests in:	Principal Variable Contracts Funds SmallCap Account – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks long-term growth of capital.

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SAM Balanced Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Strategic Asset Management Balanced Portfolio – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide a high level of total return (consisting of reinvested income and capital appreciation), as is consistent with reasonable risk. In general, relative to the other Portfolios, the Balanced Portfolio should offer investors the potential for a medium level of income and medium level of capital growth, while exposing them to a medium level of principal risk.

SAM Conservative Balanced Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Strategic Asset Management Conservative Balanced Portfolio – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide a high level of total return (consisting of reinvestment of income and capital appreciation), consistent with a moderate degree of principal risk. In general, relative to the other Portfolios, the Conservative Balanced Portfolio should offer investors the potential for a medium to high level of income and a medium to low level of capital growth, while exposing them to a medium to low level of principal risk.

SAM Conservative Growth Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Strategic Asset Management Conservative Growth Portfolio – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide long-term capital appreciation. In general, relative to the other Portfolios, the Conservative Growth Portfolio should offer investors the potential for a low to medium level of income and a medium to high level of capital growth, while exposing them to a medium to high level of principal risk.

SAM Flexible Income Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Strategic Asset Management Flexible Income Portfolio – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide a high level of total return (consisting of reinvestment of income with some capital appreciation). In general, relative to the other Portfolios, the Flexible Income Portfolio should offer investors the potential for a high level of income and a low level of capital growth, while exposing them to a low level of principal risk.

94

SAM Strategic Growth Division (This underlying mutual fund is a fund of funds.)

Invests in:	Principal Variable Contracts Funds Strategic Asset Management Strategic Growth Portfolio – Class 1
Investment Advisor:	Principal Global Investors, LLC
Investment Objective:	seeks to provide long-term capital appreciation. In general, relative to the other Portfolios, the Strategic Growth Portfolio should offer investors the potential for a high level of capital growth, and a corresponding level of principal risk.

Rydex Commodities Strategy Division

Invests in:	Rydex VI Commodities Strategy Fund
Investment Advisor:	Security Investors, LLC, which operates under the name of Guggenheim Investments
Investment Objective:	seeks to provide investment results that correlate, before fees and expenses, to the performance of a benchmark for commodities.

T. Rowe Price Blue Chip Growth Division

Invests in:	T. Rowe Price Blue Chip Growth Portfolio – II
Investment Advisor:	T. Rowe Price Associates Inc.
Investment Objective:	seeks to provide long-term capital growth. Income is a secondary objective.

T. Rowe Price Health Sciences Division (no longer available to new investors with an application signature date on or after 06/01/2015)

Invests in:	T. Rowe Price Health Sciences Portfolio – II
Investment Advisor:	T. Rowe Price Associates Inc.
Investment Objective:	seeks long-term capital appreciation.

TOPS^® Aggressive Growth ETF Division (This underlying mutual fund is a fund of funds)

Invests in:	TOPS® Aggressive Growth ETF Portfolio – Investor Class Shares
Investment Advisor:	Milliman Financial Risk Management, LLC through a sub-advisory agreement with ValMark Advisors, Inc.
Investment Objective:	seeks capital appreciation.

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TOPS^® Balanced ETF Division (This underlying mutual fund is a fund of funds)

Invests in:	TOPS® Balanced ETF Portfolio – Investor Class Shares
Investment Advisor:	Milliman Financial Risk Management, LLC through a sub-advisory agreement with ValMark Advisors, Inc.
Investment Objective:	seeks income and capital appreciation.

TOPS^® Conservative ETF Division (This underlying mutual fund is a fund of funds)

Invests in:	TOPS® Conservative ETF Portfolio – Investor Class Shares
Investment Advisor:	Milliman Financial Risk Management, LLC through a sub-advisory agreement with ValMark Advisors, Inc.
Investment Objective:	seeks to preserve capital and provide moderate income and moderate capital appreciation.

TOPS^® Growth ETF Division (This underlying mutual fund is a fund of funds)

Invests in:	TOPS® Growth ETF Portfolio – Investor Class Shares
Investment Advisor:	Milliman Financial Risk Management, LLC through a sub-advisory agreement with ValMark Advisors, Inc.
Investment Objective:	seeks capital appreciation.

TOPS^® Moderate Growth ETF Division (This underlying mutual fund is a fund of funds)

Invests in:	TOPS® Moderate Growth ETF Portfolio – Investor Class Shares
Investment Advisor:	Milliman Financial Risk Management, LLC through a sub-advisory agreement with ValMark Advisors, Inc.
Investment Objective:	seeks capital appreciation.

VanEck VIP Global Hard Assets Division

Invests in:	VanEck VIP Global Hard Assets Fund – Class S Shares
Investment Advisor:	Van Eck Associates Corporation
Investment Objective:	seeks long-term capital appreciation by investing primarily in "hard asset" securities. Income is a secondary consideration.

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13. REGISTRATION STATEMENT

This prospectus (Part A of the registration statement) omits some information contained in the Statement of Additional Information (Part B of the registration statement) and Part C of the registration statement which the Company has filed with the SEC. The SAI is hereby incorporated by reference into this prospectus. You may request a free copy of the SAI by contacting your registered representative or calling us at 1-800-852-4450.

Information about the Contract (including the Statement of Additional Information and Part C of the registration statement) can be reviewed and copied at the Securities and Exchange Commission’s Public Reference Room in Washington, D.C. Information on the operation of the public reference room may be obtained by calling the Commission at 202-551-8090. Reports and other information about the Contract are available on the Commission’s internet site at http://www.sec.gov. Copies of this information may be obtained, upon payment of a duplicating fee, by writing the Public Reference Section of the Commission, 100 F Street NE, Washington, D.C. 20549-0102.

The registration numbers for the Contract are 333-116220 and 811-02091.

14. TABLE OF CONTENTS OF THE SAI

TABLE OF CONTENTS
GENERAL INFORMATION AND HISTORY	3
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	3
PRINCIPAL UNDERWRITER	3
CALCULATION OF PERFORMANCE DATA	3
TAXATION UNDER CERTAIN RETIREMENT PLANS	12
FINANCIAL STATEMENTS	A-1
APPENDIX A - Principal Life Insurance Company Separate Account B	A-1
APPENDIX B - Principal Life Insurance Company	B-1

To obtain a copy of the Statement of Additional Information, free of charge, write or telephone:

Principal Securities, Inc.

a company of

the Principal Financial Group

Des Moines, IA 50392-2080

Telephone: 1-800-852-4450

97

APPENDIX A – PRINCIPAL^® VARIABLE ANNUITY EXCHANGE OFFER

There is no longer an exchange offer that allows you to exchange the Principal^® Variable Annuity (Flexible Variable Annuity) with the Principal^® Investment Plus Variable Annuity.

Appendix A – Principal Variable Annuity Exchange Offer     98

APPENDIX A-2 – INVESTMENT PLUS VARIABLE ANNUITYGMWB EXCHANGE OFFER

IPVA GMWB Exchange Offer ("GMWB Exchange Offer")

Original owners of an eligible Principal^® Investment Plus Variable Annuity contract (“old contract”) may elect to exchange their old contract for a new Principal^® Lifetime Income Solutions II Variable Annuity contract ("new contract") subject to the GMWB Exchange Offer terms and conditions below. To determine if it is in your best interest to participate in the GMWB Exchange Offer, we recommend that you consult with your tax advisor and financial professional before electing to participate in the GMWB Exchange Offer. Please contact your registered representative or call us at 1-800-852-4450 if you have any questions.

You are eligible to participate in the GMWB Exchange Offer when:

• The old contract doesn't have a Guaranteed Minimum Withdrawal Benefit ("GMWB") rider or the old contract has a GMWB 1 rider (Investment Protector Plus); and

• Your old contract is not subject to any surrender charges; and

• The GMWB Exchange Offer is available in your state.

GMWB Exchange Offer Terms and Conditions

• You must qualify for and elect either the Target Income Protector, Flexible Income Protector, or Flexible Income Protector Plus rider (currently being marketed by us). To qualify, you (or the annuitant if the original owner is a non-natural person) must be between the ages of 45 and 80.

• You must receive a current prospectus for the new contract.

• You must complete all required GMWB Exchange Offer forms.

• If we approve your application to participate in the GMWB Exchange Offer, you are directing that all of yourinvestment options under your old contract be terminated. The resulting amount will be transferred to your new contract and allocated as you direct. The Target Income Protector, Flexible Income Protector, or Flexible Income Protector Plus rider results in restriction of your Contract investment options to more limited GMWB investment options (review the new contract prospectus in its entirety for full details).

• Any new premium payments (excluding the amount transferred under this GMWB Exchange Offer) you make to the new contract are subject to surrender charges.

• The amount being exchanged to the new contract cannot be allocated to the DCA Plus accounts. However, new premium payments may be allocated to the DCA Plus accounts.

• At Contract issue, the GMWB death benefit under your new contract will be the greater of the death benefit under your old contract on the exchange date or the GMWB death benefit under the new contract.

• Upon issuing you a new contract, your old contract will terminate.

• The GMWB Exchange Offer is not available for partial exchanges.

• Only one old contract can be exchanged for one new contract.

GMWB Exchange Offer Duration

Currently, there is no closing date for the GMWB Exchange Offer. We reserve the right, however, to modify or terminate the GMWB Exchange Offer upon reasonable written notice to you .

IMPORTANT CONSIDERATIONS

An exchange may or may not be in your best interest.

If you currently have the GMWB 1 rider with your old contract, this GMWB Exchange Offer may be appropriate if you:

• Want to benefit from potential annual increases to your rider values instead of every 5 years with the GMWB 1 rider.

• Want the ability to elect the Joint Life benefit instead of only Single Life with the GMWB 1 rider.

• Want to protect against the risk that your Contract accumulated value could fall below your investment due to market decline.

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     99

If you currently do not have a GMWB rider with your old contract, this GMWB Exchange Offer may be appropriate if you:

• Do not intend to take withdrawals in the near future.

• Want to benefit from potential annual increases in your rider values that match the growth of your Contract accumulated value.

• Want to protect against the risk of you or your spouse outliving your income.

• Want to protect against the risk that your Contract accumulated value could fall below your investment due to market decline.

The features and benefits, investment options, and charges and deductions of the new contract may differ from those of your old contract. For your convenience, we have provided the following chart with a side-by-side summary comparison of the features and costs of your old contract and the new contract available under the GMWB Exchange Offer.

There may be additional differences important for you to consider prior to making an exchange. You should carefully review the new contract prospectus and compare it to the old contract prospectus before deciding to make an exchange. To obtain a prospectus, please contact us at 1-800-852-4450.

Summary Comparison* of Old Contract and New Contract

To participate in the GMWB Exchange Offer you must elect either the Target Income Protector, Flexible Income Protector, or Flexible Income Protector Plus rider.

A. GMWB Rider Features	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
GMWB Rider(s) (applicable to this offer)	GMWB 1 (when applicable)	Target Income Protector Flexible Income Protector Flexible Income Protector Plus
Guaranteed Minimum Withdrawal Benefits	• Investment Back • For Life (“Single Life”)	Target Income Protector: • For Life (“Single Life” or “Joint Life”) Flexible Income Protector: • For Life (“Single Life” or “Joint Life”) Flexible Income Protector Plus: • For Life (“Single Life” or “Joint Life”)

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     100

A. GMWB Rider Features	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
Annual Withdrawal Limits	• Investment Back - 7.00% of the    the Investment Back    withdrawal benefit base • For Life - 5.00% of the For    Life withdrawal benefit base	Target Income Protector, Flexible Income Protector and Flexible Income Protector Plus: •    “Single Life” — tiered percentages based on age at first withdrawal, calculated as a percentage of the For Life withdrawal benefit base •    “Joint Life” — tiered percentages based on age at first withdrawal, calculated as a percentage of the For Life withdrawal benefit base NOTE: Refer to GMWB Percentages section of this prospectus or the applicable GMWB Charges and Percentages Supplement.
GMWB investment options	Restricted investment options depending on when old contract was purchased and customer’s actions: • GMWB Self-Build Models • GMWB Select Models • Principal Lifetime 2010 Account • Principal Lifetime 2020 Account • Principal Lifetime Strategic    Income account • Strategic Asset Management    Balanced Portfolio • Strategic Asset Management     Conservative Balanced     Portfolio • Strategic Asset Management     Flexible Income Portfolio • Diversified Balanced Account • Diversified Growth Account • Diversified Income Account NOTE: If GMWB was not elected, there are no investment restrictions.	Target Income Protector: • Diversified Income Account • Diversified Balanced Volatility Control Account • Diversified Growth Volatility Control Account • Fidelity VIP Government Money Market Portfolio Flexible Income Protector: • Diversified Balanced Account • Diversified Growth Account • Diversified Income Account • Diversified Balanced Managed    Volatility Account • Diversified Growth Managed    Volatility Account • Fidelity VIP Government Money Market Portfolio Flexible Income Protector Plus: • Diversified Balanced Account • Diversified Growth Account • Diversified Income Account • Diversified Balanced Managed    Volatility Account • Diversified Growth Managed    Volatility Account • Fidelity VIP Government Money Market Portfolio
Fixed Rate Options (including 2 dollar-cost averaging options)	1 year - Fixed Account 6 month - DCA Plus account** 12 month - DCA Plus account**	6 month - DCA Plus account** 12 month - DCA Plus account**

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     101

A. GMWB Rider Features	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
GMWB Bonus	If no withdrawals are taken, a GMWB Bonus is applied to the benefit bases each year on the Contract anniversary as shown below: • Years 1-5 - 5.00% of premium payments • Years 6+ - 0.00% of premium payments	Target Income Protector: If no withdrawals are taken, a GMWB bonus is applied to the benefit base on each Contract anniversaryas shown below: • Years 1-15 - 5.00% of     premium payments • Years 16+ - 0.00% of     premium payments Flexible Income Protector: GMWB Bonus does not apply for this rider. Flexible Income Protector Plus: If no withdrawals are taken, a GMWB bonus is applied to the benefit base on each Contract anniversaryas shown below: • Year 1 - 4.00% of     premium payments • Year 2 - 5.00% of     premium payments • Year 3 - 6.00% of     premium payments • Year 4 - 7.00% of     premium payments • Year 5 - 8.00% of     premium payments • Year 6 - 9.00% of     premium payments • Year 7 - 10.00% of     premium payments • Years 8+ - 0.00% of     premium payments NOTE: The percentages above apply for applications signed from May 1, 2020 through May 31, 2020. The GMWB Bonus Percentages may be different than those listed above for applications signed after May 31, 2020.

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     102

A. GMWB Rider Features	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
GMWB Step-Up	• Optional GMWB Step-Up     that you may elect beginning     with the 5th Contract anniversary.  Once you have     elected a GMWB Step-Up,     you must wait at least 5     5 contract years to elect     another GMWB Step-Up. • Rider effective dates on or     after June 15, 2008: the     remaining withdrawal benefit     bases are not eligible for     Step-Ups after the     Investment Back remaining     withdrawal benefit base     reduces to zero, even if     additional premium payments     are made.	• Automatic annual GMWB Step-Up available until the later of (a) the Contract anniversary prior to age 80 or (b) 10 years after the rider effective date.
Automatic Portfolio Rebalancing	Calendar Quarterly (required with GMWB 1 rider)	Calendar Quarterly (required with in force GMWB rider)
No. of Free Division Transfers/contract year	1	1

B. Annuitization	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
Annuity Benefit Payments First Available	Any time on/after the first Contract anniversary	Same
Annuity Benefit Payments	Fixed annuity benefit payments	Same
Annuity Mortality Table	Annuity 2000 Mortality Table	2012 Individual Annuity Mortality Period Life Table Mortality Table
Annuity Benefit Payment Options	Fixed period; life income; life income with fixed period; custom options	Life income; life income with guaranteed period; custom options

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     103

C. Death Benefit	Old Investment Plus Variable Annuity	New Principal Lifetime Income Solutions II Variable AnnuitySM
Death Benefit	An amount equal to the greatest of (i) total premium payments less surrenders, or (ii) Contract value, or (iii) 7 year Step-Up For partial surrenders, the death benefit is reduced proportionately for each withdrawal. See the Death Benefit section in this appendix for more details.	An amount equal to the greatest of (i) total premium payments less surrenders, or (ii) Contract value, or (iii) 7 year Step-Up For partial surrenders, withdrawals that are not For Life excess withdrawals will reduce the GMWB Death Benefit by the amount of withdrawal. Any For Life excess withdrawal amounts reduce the GMWB Death Benefit proportionately. See the Death Benefit section in this appendix for more details.
Optional Enhanced Death Benefit Rider	Available	Not available
Payable	1st owner to die	Same

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     104

D. Fees and Charges	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
Annual Fee (waived for Contracts with accumulated value of $30,000 or more)	Lesser of $30 or 2% of Contract accumulated value	Same
Mortality and Expense Risks Charge***	1.25%	Maximum: 1.50% Current: 1.25%
Administration Charge*** (on an annual basis)	Maximum: 0.15% Current: 0.15%	Maximum: 0.50% Current: 0.15%
Available Underlying Mutual Fund Expenses****	Maximum Annual: 2.10% Minimum Annual: 0.25%	Maximum Annual: 0.62% Minimum Annual: 0.49%
GMWB 1 Rider Charge – Taken as % of average quarterly Investment Back remaining withdrawal benefit base.	Maximum Annual: 0.85% Current Annual: 0.80% A 0.60% annual charge is assessed if the rider application was signed before February 16, 2009 and no GMWB Step-Up has occurred. A 0.80% annual charge is assessed if the rider application was signed before February 16, 2009 and a GMWB Step-Up has occurred. If the rider application was signed after February 16, 2009, the annual fee is 0.80%.	Not applicable
Target Income Protector Rider Charge – Taken as % of average quarterly For Life withdrawal benefit base. -OR- Flexible Income Protector Rider Charge – Taken as % of average quarterly For Life withdrawal benefit base. -OR- Flexible Income Protector Plus Rider Charge – Taken as % of average quarterly For Life withdrawal benefit base.	Not applicable Not applicable Not applicable	Maximum Annual: 2.00% Current Annual: 1.55% Maximum Annual: 2.00% Current Annual: 0.95% Maximum Annual: 2.00% Current Annual: 1.35% NOTE: The charges above apply for applications signed from May 1, 2020 through May 31, 2020. The GMWB charges may be different than those listed above for applications signed after May 31, 2020.

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     105

E. Transaction Charges	Old Investment Plus Variable Annuity	New Principal® Lifetime Income Solutions II Variable Annuity
Surrender Charge Period and % of amount surrendered (applies only to new premium payments)	7 years (6,6,6,5,4,3,2) 9 years (8,8,7,6,5,4,3,2,1) if you elected the Premium Payment Credit Rider	7 years (6,6,6,5,4,3,2) Premium Payment Credit Rider not available
Unscheduled Partial Surrender	Maximum: lesser of $25 or 2% of each unscheduled partial surrender after the 12th in a contract year. Current $0/0%	Same
Unscheduled Transfers	Maximum: lesser of $25 or 2% of each unscheduled transfer after the 1st in a contract year. Current: $0/0%	Same

*    Does not reflect state variations.

** Only available for new premium payments. The DCA Plus Accounts are not available for the amount being exchanged.

*** Charges taken daily as a percentage of the average daily Separate Account division value.

**** For the new contract, only maximum and minimum charges for the GMWB investment options are reflected.

Charges and Expenses

The new contract and your old contract have different annual expenses, different transaction charges, and different investment options that may result in different underlying mutual fund expenses.

Surrender Charges

Under the GMWB Exchange Offer, surrender charges will not apply on any amounts transferred from the old contract to the new contract. Surrender charges under the new contract will only apply to new contract premium payments.

GMWB Death Benefit

The GMWB death benefit in the new contract will be calculated as specified in the prospectus for the new contract. At the time of the exchange, the death benefit from the old contract will be transferred to the new contract and will be adjusted for new premium payments made and withdrawals taken under the new contract.

Upon your death, we will pay the greater of the new contract GMWB death benefit (standard death benefit if GMWB rider is not in force) or the old contract death benefit adjusted as described above.

GMWB Rider

The new contract offers GMWB riders (Target Income Protector, Flexible Income Protector or Flexible Income Protector Plus) that were not available when you purchased your old contract. A GMWB rider allows you to take certain guaranteed annual withdrawals, regardless of your Contract accumulated value.

Your Contract can only have one GMWB rider. You must qualify for and select either the Target Income Protector, Flexible Income Protector, or Flexible Income Protector Plus rider when you purchase the new contract.

Once elected, the Target Income Protector, Flexible Income Protector, or Flexible Income Protector Plus rider may not be terminated for 5 contract years following the rider effective date.

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     106

Election of a GMWB rider results in restriction of your Contract investment options to the more limited GMWB investment options (additional information is included in the new contract prospectus). The GMWB investment options reflect a balanced investment objective that is intended to support the rider guarantees. If your investment objective is aggressive growth, the rider investment restrictions may not support your investment objective.

Target Income Protector

The Target Income Protectorrider offers an annual Step-Up feature. The GMWB Step-Up can increase your rider For Life withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are added or the division values rise with market growth.

The Target Income Protector rider also offers a GMWB Bonus. This rider includes an annual bonus for not taking withdrawals for a specific number of years immediately following the purchase of a Contract. The GMWB Bonus amount will provide an increase to your rider For Life withdrawal benefit payments. The GMWB Bonus does not increase your Contract accumulated value.

The Target Income Protector rider provides your beneficiary(ies) with the GMWB Death Benefit.

Flexible Income Protector

The Flexible Income Protector rider offers an annual Step-Up feature. The GMWB Step-Up can increase your rider For Life withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are made or the division values rise with market growth.

The Flexible Income Protector rider provides your beneficiary(ies) with the GMWB Death Benefit.

Flexible Income Protector Plus

The Flexible Income Protector Plus rider offers an annual Step-Up feature. The GMWB Step-Up can increase your rider For Life withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are added or the division values rise with market growth.

The Flexible Income Protector Plus rider also offers a GMWB Bonus. This rider includes an annual bonus for not taking withdrawals for a specific number of years immediately following the purchase of a Contract. The GMWB Bonus amount will provide an increase to your rider For Life withdrawal benefit payments. The GMWB Bonus does not increase your Contract accumulated value.

The Flexible Income Protector Plus rider provides your beneficiary(ies) with the GMWB Death Benefit.

It is important that you review the new contract prospectus in its entirety for additional information regarding the Target Income Protector, Flexible Income Protector, and Flexible Income Protector Plus riders and whether a GMWB rider is appropriate for your needs.

Tax Matters

Although we believe that an exchange as described in this appendix will not be a taxable event for Federal tax purposes, we recommend that you consult your tax advisor before electing to participate in the GMWB Exchange Offer.

There may be differences between your old contract, as amended by tax-qualified retirement plan endorsements, and the new contract, as amended by similar qualified plan endorsements. If you are using the old contract in connection with a tax-qualified retirement plan, you should consult a tax advisor before electing to participate in the GMWB Exchange Offer. See 10. FEDERAL TAX MATTERS section of the new contract prospectus.

Appendix A-2 – Investment Plus Variable Annuity GMWB Exchange Offer     107

APPENDIX B — GMWB INVESTMENT OPTIONS

While a GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under a GMWB rider (the “GMWB investment options”) reflect a balanced investment objective and if your investment goal is aggressive growth, a GMWB rider may not support your investment objective. With GMWB investment options that reflect a balanced investment objective, there is potentially a reduced likelihood that we will have to make GMWB benefit payments when the Contract value goes to zero, reaches the maximum annuitization date, or if there is a death claim.

When you purchase a GMWB rider, you must allocate 100% of your Separate Account division value to one or more of the available Separate Account GMWB investment options. Any future premium payments are allocated to the GMWB investment options your Separate Account division value is/are invested in at the time of the new premium payments.

The available GMWB investment options are:

• Diversified Balanced Managed Volatility Account;

• Diversified Growth Managed Volatility Account;

• Diversified Balanced Account;

• Diversified Growth Account; and

• Diversified Income Account.

For more information about the Diversified Balanced Managed Volatility Account, Diversified Growth Managed Volatility Account, Diversified Balanced Account, Diversified Growth Account, and Diversified Income Account, see the underlying mutual fund’s prospectus provided with this prospectus.

You may allocate premium payments and transfer Contract accumulated value to the Fixed Account. You may also allocate new premium payments to the DCA Plus Accounts. Such allocations and transfers are subject to the provisions of your Contract. See 3. FIXED ACCOUNT AND FIXED DCA PLUS ACCOUNTS.

We reserve the right to modify the list of available Separate Account divisions in a GMWB Model or modify the list of available GMWB investment options, subject to compliance with applicable regulations. We may make available other GMWB Models. We also may make changes to or restrict the availability of GMWB Models or other GMWB investment options. Changes or restrictions will apply only to new purchasers of the Contract or to you if youtransfer out of a GMWB Model or investment option and wish to transfer back to that GMWB Model or investment option.

You must stay invested in the GMWB investment options as long as the GMWB rider is in effect. Note, the rider may not be terminated for five contract years following the rider effective date.

NOTE: If you have the GMWB 1 rider and elect to Step-Up, you agree to select from the then current GMWB investment options.

Transfers Between GMWB Investment Options

You may transfer 100% of yourSeparate Accountdivision value from your current GMWB investment option to one other GMWB investment option which is available at the time of the transfer. If youtransfer from a discontinued GMWB investment option, you will not be able to transfer back to that GMWB investment option. You may make a transfer by providing us notice (we will effect the transfer at the price next determined after we receive yournotice in good order).

If yourSeparate Accountdivision value is invested in a GMWB investment option which is no longer available with the rider but is still available under the Contract, you may continue to maintain that investment and allocate new premium payments to it. If the discontinued GMWB investment option involves more than one Separate Account division, we will rebalance yourSeparate Accountdivision value each calendar quarter. You may not transferyourSeparate Accountdivisionvalue to any other discontinued GMWB investment option. You may transferyourSeparate Accountdivision value to another GMWB investment option that is available at the time of transfer; in this case, the discontinued GMWB investment option will no longer be available to you.

Appendix B – GMWB Investment Options         108

GMWB Investment Options Underlying Funds

You should note that the GMWB investment options are series of Principal Variable Contracts Funds, Inc., which is managed by Principal Global Investors, LLC ("PGI"), an affiliate of ours. If you wish to invest your Contract accumulated value predominantly in underlying funds that are not managed by an affiliate of ours, a GMWB rider may not be appropriate for you.

To the extent that an underlying fund managed by PMC may be included as a GMWB investment option, PMC will receive additional compensation from the management fee of the underlying fund. However, we do not take such potential financial benefit into account in selecting the underlying fund to be a GMWB investment option.

Discontinued GMWB Investment Options (No Longer Available for Contracts issued on or after January 4, 2010)

• GMWB Self-Build Model A;

• GMWB Self-Build Model B;

• GMWB Self-Build Model C;

• GMWB Self-Build Model D;

• Principal LifeTime 2010 Account;

• Principal LifeTime 2020 Account;

• Principal LifeTime 2030 Account;*

• Principal LifeTime Strategic Income Account;

• Strategic Asset Management Balanced Portfolio;

• Strategic Asset Management Conservative Balanced Portfolio; or

• Strategic Asset Management Flexible Income Portfolio.

* Principal LifeTime 2030 Account was only available as an investment option with the GMWB 2 Rider.

For more information about: (1) GMWB Self-Build and GMWB Select Models, please see below; (2) Principal LifeTime Accounts, Strategic Asset Management (SAM) Portfolios, Diversified Growth, Diversified Balanced and Diversified Income Accounts; see the underlying fund's prospectus provided with this prospectus; (3) the Fixed and DCA Plus Accounts, see 3.FIXED ACCOUNT AND FIXED DCA PLUS ACCOUNTS and (4) transfers under your Contract, see 6. TRANSFERS AND SURRENDERS and 9.ADDITIONAL INFORMATION ABOUT THE CONTRACT.

GMWB Self-Build Models

GMWB Self-Build Models are not available for Contracts issued on or after January 4, 2010.

Each of the GMWB Self-Build Models requires you to allocate yourSeparate Account division value and premium payments in specified percentages among asset classes and provides you limited ability to select the Separate Account divisions that you wish to use to meet those allocation requirements. The major asset classes on which each model is based and the required allocations among those asset classes are shown in the following table.

Asset Class	Model A	Model B	Model C	Model D
Short-Term Fixed Income	30%	20%	10%	15%
Fixed Income	40%	30%	20%	15%
Balanced/Asset Allocation	10%	15%	20%	25%
Large US Equity	20%	25%	30%	25%
Small/Mid US Equity	0%	5%	15%	0%
International Equity	0%	5%	5%	20%

If you are invested in a GMWB Self-Build Model, you are directing us to allocate yourSeparate Account divisionvalue and premium payments according to the allocation percentages you have set. In addition, you are directing us to automatically rebalance yourSeparate Accountdivision value each calendar quarter to match the allocation percentages you set in your GMWB Self-Build Model. The sum of the percentages that you allocate to the Separate Account divisions in an asset class or sub-class must equal the required aggregate percentage for that asset class or sub-class. The sum of the percentages you invest in all the asset classes must equal 100% of yourSeparate Accountdivision value.

Appendix B – GMWB Investment Options         109

You may transfer among the divisions within an asset class or sub-class as long as your allocations for that asset class or sub-class equal the percentage established by your chosen GMWB Self-Build Model, and you adhere to the transfer provisions of your Contract (see 6. TRANSFERS AND SURRENDERS and 9.ADDITIONAL INFORMATION ABOUT THE CONTRACT). We currently do not charge a fee for a transfer. If we start charging a fee in the future, we will not impose such fee on the quarterly Automatic Portfolio Rebalancing.

You should note that most of the underlying funds available as options under the GMWB Self-Build Models are series of Principal Variable Contract Funds, Inc., which invest your Contract value predominantly in underlying funds that are not managed by an affiliate of ours, a GMWB rider may not be appropriate for you.

To the extent that an underlying fund managed by PMC may be included as an option under a GMWB Self-Build Model, PMC will receive additional compensation from the management fee of the underlying fund. However, we do not take such potential financial benefit into account in selecting the underlying fund to be an option under a GMWB Self-Build Model.

We reserve the right to modify the list of available Separate Account divisions in a GMWB Self-Build Model, subject to compliance with applicable regulations. We may make available other GMWB Models. We may also make changes to or restrict the availability of GMWB Models. Changes or restrictions will apply only to new purchases of the Contract or to you if youtransfer out of a GMWB Model and wish to transfer back to that model.

In maintaining a GMWB Self-Build Model, you should consider your personal objectives, investment time horizons, risk tolerance and other financial circumstances. You should also remember that asset allocation does not insure a profit or protect against loss. You may wish to ask your financial representative for assistance in maintaining a model and choosing among the Separate Account divisions available under that model. To discuss whether your selections remain appropriate for your needs, contact your financial representative.

GMWB Select Models

GMWB Select Models are not available for Contracts issued on or after November 21, 2008.

Each of the GMWB Select Models requires you to allocate yourSeparate Accountdivisionvalue and premium payments in specified percentages among asset classes. The major asset classes on which each model is based and the required allocations among those asset classes are shown in the following table.

Asset Class	Model A	Model B	Model C
Short-Term Fixed Income	30%	20%	10%
Fixed Income	40%	30%	20%
Large US Equity	30%	40%	50%
Small/Mid US Equity	0%	5%	15%
International Equity	0%	5%	5%

If you are invested in a GMWB Select Model, you are directing us to allocate yourpremium payments and Separate Accountdivision value according to the allocation percentages shown in the chart above. In addition, you are directing us to automatically rebalance the Separate Accountdivisionvalue each calendar year to match the allocation percentages of your chosen GMWB Select Model.

Appendix B – GMWB Investment Options         110

APPENDIX C – Principal Income Builder 3 Examples

These examples have been provided to assist you in understanding the various features of the Principal Income Builder 3 GMWB rider and to demonstrate how premium payments received and withdrawals taken from the Contract affect the values and benefits under the rider. These examples are based on certain hypothetical assumptions and are for illustrative purposes only. These examples are not intended to serve as projections of future investment returns.

NOTE:    The owner’s actions determine the benefits received.

NOTE: For the purpose of the following examples, a partial annuitization has the same effect as a partial surrender and both are referred to as a withdrawal in the following examples.

Examples Without Excess Withdrawals

Examples 1-5 assume the following:

• the owner is age 62 and the owner’s spouse is age 60 on the rider effective date.

• initial premium payment = $100,000.

• The For Life withdrawal benefit base prior to partial surrender = $100,000.

• “Single Life” For Life (4.75%) withdrawal benefit payment = $4,750, if withdrawals start prior to the owner attaining age 65.

• “Joint Life” For Life (4.25%) withdrawal benefit payment = $4,250, if withdrawals start prior to the spouse attaining age 65.

Example 1

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit base after the bonus is credited is larger than the Contract’s accumulated value.

• the new For Life withdrawal benefit base is $100,000 + $7,000 = $107,000.

• the new “Single Life” For Life withdrawal benefit payment is $107,000 x 0.0475 = $5,082.50.

Example 2

In contract year one:

• no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

• the owner makes a premium payment of $50,000.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is ($100,000 + $50,000) x 0.07 = $10,500.

• there is no GMWB Step-Up because the withdrawal benefit base after the bonus is credited is larger than the Contract’s accumulated value.

• the new For Life withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500.

• the new “Single For Life” For Life withdrawal benefit payment is $160,500 x 0.0475 = $7,623.75.

Appendix C – Principal Income Builder 3 Examples         111

Example 3

In contract year one, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,250. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.25%.

On the first Contract anniversary:

• Since a withdrawal was taken in contract year one, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit base is larger than the Contract’s accumulated value.

• the For Life withdrawal benefit base remains the same ($100,000).

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($100,000 x .0425 = $4,250).

Example 4

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit base after the bonus is credited is larger than the Contract’s accumulated value.

• the new For Life withdrawal benefit base is $100,000 + $7,000 = $107,000.

• the new “Single Life” For Life withdrawal benefit payment is $107,000 x .0475 = $5,082.50.

In contract year two, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,250. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.25%.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit base is larger than the Contract’s accumulated value.

• the For Life withdrawal benefit base remains the same ($107,000).

• the “Joint Life” For Life withdrawal benefit payment for the next contract year is $107,000 x .0425 = $4,547.50.

In contract year three, no withdrawals are taken. The “Joint Life” For Life withdrawal benefit payment percentage remains locked-in at 4.25%.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit base is larger than the Contract’s accumulated value.

• the For Life withdrawal benefit base remains the same ($107,000).

• The “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($107,000 x .0425 = $4,547.50)

Example 5

The owner elects the “Single Life” For Life withdrawal benefit payment, and in each of the first two contract years, takes a withdrawal of $5,000. Assume there is no GMWB Step-Up on the first Contract anniversary. On the 2nd Contract anniversary, the owner will receive GMWB Step-Up if the Contract’s accumulated value is greater than the applicable withdrawal benefit base.

If the accumulated value on the second Contract anniversary is:	$95,000	$110,000
For Life (“Single Life”)
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.0475 = $4,750	$100,000 x 0.0475 = $4,750
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.0475 = $4,750	$110,000 x 0.0475 = $5,225

Appendix C – Principal Income Builder 3 Examples         112

Examples 6 assumes the following:

• the owner is age 70 and the owner’s spouse is age 56 on the rider effective date.

• initial premium payment = $100,000.

• The For Life withdrawal benefit base prior to partial surrender = $100,000.

• “Single Life” For Life (5.50%) withdrawal benefit payment = $5,500, if withdrawals start prior to the owner attaining age 75.

• “Joint Life” For Life (4.00%) withdrawal benefit payment = $4,000, if withdrawals start prior to the owner’s spouse attaining age 60.

Example 6

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit base after the bonus is credited is larger than the Contract’s accumulated value.

• the new For Life withdrawal benefit base is $100,000 + $7,000 = $107,000.

• the new “Single Life” For Life withdrawal benefit payment is $107,000 x .0550 = $5,885.00.

In contract year two, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,000. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.00%.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit base is larger than the Contract’s accumulated value.

• the For Life withdrawal benefit base remains the same ($107,000).

• the “Joint Life” For Life withdrawal benefit payment for the next contract year is $107,000 x .0400 = $4,280.00.

In contract year three, no withdrawals are taken. The “Joint Life” For Life withdrawal benefit payment percentage remains locked-in at 4.00%.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit base is larger than the Contract’s accumulated value.

• the For Life withdrawal benefit base remains the same ($107,000).

The “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($107,000 x .0400 = $4,280.00)

Examples With Excess Withdrawals

Examples 7-8 assume the following:

• the owner is age 62 and elected “Single Life” For Life withdrawal benefit payments at the first withdrawal and therefore, locks-in the “Single Life” For Life withdrawal benefit payment percentage at 4.75%.

• the initial premium payment is $100,000

• the withdrawal benefit base prior to partial surrender = $100,000

• “Single Life” For Life (4.75%) withdrawal benefit payment = $4,750

• Withdrawal taken = $8,000

•excess amount under the For Life withdrawal option is $3,250

Appendix C – Principal Income Builder 3 Examples         113

Example 7

In this example, assume the accumulated value prior to the withdrawal is $90,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

For Life

The amount of the adjustment* is $3,812.32. The new For Life withdrawal benefit base is $100,000 - $3,812.32 = $96,187.68.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $3,250 (the amount of the excess withdrawal); and

b = $3,812.32 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment remaining prior to the withdrawal ($3,250);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $4,750); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 4.75%.

For Life

The new “Single Life” For Life withdrawal benefit payment is $96,187.68 x 0.0475 = $4,568.91.

Example 8

In this example, assume the accumulated value prior to the withdrawal is $110,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

For Life

The amount of the adjustment* is $3,250 (the amount of the excess withdrawal). The new For Life withdrawal benefit base is $100,000 - $3,250 = $96,750.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $3,250 (the amount of the excess withdrawal); and

b = $3,087.89 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment available prior to the withdrawal ($3,250);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $4,750); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 4.75%.

For Life

The new “Single Life” For Life withdrawal benefit payment is $96,750 x 0.0475 = $4,595.62

Appendix C – Principal Income Builder 3 Examples         114

APPENDIX D – Principal Income Builder 10 Examples

These examples have been provided to assist you in understanding the various features of the Principal Income Builder 10 GMWB rider and to demonstrate how premium payments received and withdrawals taken from the Contract affect the values and benefits under the rider. These examples are based on certain hypothetical assumptions and are for illustrative purposes only. These examples are not intended to serve as projections of future investment returns.

NOTE:    The owner’s actions determine the benefits received.

NOTE: For the purpose of the following examples, a partial annuitization has the same effect as a partial surrender and both are referred to as a withdrawal in the following examples.

Examples Without Excess Withdrawals

Examples 1-5 (without excess withdrawals) assume the following:

• the owner is age 62 and the owner’s spouse is age 60 on the rider effective date.

• initial premium payment = $100,000.

• the withdrawal benefit bases prior to partial surrender = $100,000.

• the remaining withdrawal benefit bases prior to partial surrender = $100,000.

• Investment Back (7%) withdrawal benefit payment = $7,000.

• “Single Life” For Life (5%) withdrawal benefit payment = $5,000, if withdrawals start prior to the owner attaining age 70.

• “Joint Life” For Life (4.50%) withdrawal benefit payment = $4,500, if withdrawals start prior to the spouse attaining age 70.

Example 1

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit base(but not to the remaining withdrawal benefit bases). The credit is $100,000 x 0.05 = $5,000.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + 5,000 = $105,000;

•the Investment Back remaining withdrawal benefit base remains the same ($100,000); and

•the new Investment Back withdrawal benefit payment is $105,000 x 0.07 = $7,350.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + 5,000 = $105,000;

• the For Life remaining withdrawal benefit base remains the same ($100,000); and

• the new “Single Life” For Life withdrawal benefit payment is $105,000 x 0.05 = $5,250.

Appendix D – Principal Income Builder 10 Examples         115

Example 2

In contract year one:

• no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

• the owner makes a premium payment of $50,000.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit base (but not to the remaining withdrawal benefit bases). The credit is ($100,000 + $50,000) x 0.05 = $7,500.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500;

• the new Investment Back remaining withdrawal benefit base is $100,000 + $50,000 = $150,000; and

•the new Investment Back withdrawal benefit payment is $157,500 x 0.07 = $11,025.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500;

• the new For Life remaining withdrawal benefit base is $100,000 + $50,000 = $150,000; and

• the new “Single Life” For Life withdrawal benefit payment is $157,500 x 0.05 = $7,875.

Example 3

In contract year one, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,500. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.5%.

On the first Contract anniversary:

• Since a withdrawal was taken in contract year one, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

• the withdrawal benefit base remains the same ($100,000);

• the new remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.07 = $7,000).

• For Life:

• the For Life withdrawal benefit base remains the same ($100,000);

• the new For Life remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.0450 = $4,500).

Appendix D – Principal Income Builder 10 Examples         116

Example 4

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.05 = $5,000.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + 5,000 = $105,000;

• the Investment Back remaining withdrawal benefit base remains the same ($100,000); and

• the new Investment Back withdrawal benefit payment is $105,000 x 0.07 = $7,350.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + 5,000 = $105,000;

• the For Life remaining withdrawal benefit base remains the same ($100,000); and

• the new “Single Life” For Life withdrawal benefit payment is $105,000 x 0.05 = $5,250.

In contract year two, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,500. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.50%.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($105,000);

•the new Investment Back remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the Investment Back withdrawal benefit payment for the next contract year remains the same ($105,000 x 0.07 = $7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the new For Life remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year is $105,000 x 0.0450 = $4,725.

In contract year three, no withdrawals are taken. The “Joint Life” For Life withdrawal benefit payment percentage remains locked-in at 4.50%.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

• the Investment Back withdrawal benefit base remains the same ($105,000);

• the Investment Back remaining withdrawal benefit base remains the same ($95,500); and

• the Investment Back withdrawal benefit for the next contract year remains the same ($105,000 x 0.07 = $7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the For Life remaining withdrawal benefit base remains the same ($95,500); and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($105,000 x 0.0450 = $4,725).

Appendix D – Principal Income Builder 10 Examples         117

Example 5

The owner elects the “Single Life” For Life withdrawal benefit payment, and in each of the first two contract years, takes a withdrawal of $5,000. Assume there is no GMWB Step-Up on the first Contract anniversary. On the 2nd Contract anniversary, the owner will receive the GMWB Step-Up if the Contract’s accumulated value is greater than the applicable withdrawal benefit base.

If the accumulated value on the second Contract anniversary is:	$95,000	$110,000
Investment Back
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$100,000 x 0.07 = $7,000
Remaining Withdrawal Benefit Base	$90,000	$90,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$110,000 x 0.07 = $7,700
Remaining Withdrawal Benefit Base	$90,000	$110,000
For Life (“Single Life”)
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$100,000 x 0.05 = $5,000
Remaining withdrawal Benefit Base	$90,000	$90,000

If the accumulated value on the second Contract anniversary is:	$95,000	$110,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$110,000 x 0.05 = $5,500
Remaining Withdrawal Benefit Base	$90,000	$110,000

Example 6 (without excess withdrawals) assumes the following:

• the owner is age 70 and the owner’s spouse is age 56 on the rider effective date.

• initial premium payment = $100,000.

• the withdrawal benefit bases prior to partial surrender = $100,000.

• the remaining withdrawal benefit bases prior to partial surrender = $100,000.

• Investment Back (7%) withdrawal benefit payment = $7,000.

• “Single Life” For Life (5.50%) withdrawal benefit payment = $5,500, if withdrawals start prior to the owner attaining age 75.

• “Joint Life” For Life (4.00%) withdrawal benefit payment = $4,000, if withdrawals start prior to the owner’s spouse attaining age 60.

Appendix D – Principal Income Builder 10 Examples         118

Example 6

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the owner has not made a For Life withdrawal benefit payment election, we automatically calculate For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.0550 = $5,500.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + 5,000 = $105,000;

• the Investment Back remaining withdrawal benefit base remains the same ($100,000); and

• the new Investment Back withdrawal benefit payment is $105,000 x 0.07 = $7,350.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + 5,000 = $105,000;

• the For Life remaining withdrawal benefit base remains the same ($100,000); and

• the new “Single Life” For Life withdrawal benefit payment is $105,000 x 0.0550 = $5,775.

In contract year two, the owner elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,000. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.00%.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($105,000);

•the new Investment Back remaining withdrawal benefit base is $100,000 - $4,000 = $96,000; and

•the Investment Back withdrawal benefit payment for the next contract year remains the same ($105,000 x 0.07 = $7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the new For Life remaining withdrawal benefit base is $100,000 - $4,000 = $96,000; and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year is $105,000 x 0.0400 = $4,200.

In contract year three, no withdrawals are taken. The “Joint Life” For Life withdrawal benefit payment percentage remains locked-in at 4.00%.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

• the Investment Back withdrawal benefit base remains the same ($105,000);

• the Investment Back remaining withdrawal benefit base remains the same ($96,000); and

• the Investment Back withdrawal benefit for the next contract year remains the same ($105,000 x 0.07 = $7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the For Life remaining withdrawal benefit base remains the same ($96,000); and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($105,000 x 0.0400 = $4,200).

Appendix D – Principal Income Builder 10 Examples         119

Examples With Excess Withdrawals

Excess withdrawal examples 7-8 assume the following:

• the owner is age 62 and elected “Single Life” For Life withdrawal benefit payments at the first withdrawal and therefore, locks-in the “Single Life” For Life withdrawal benefit payment percentage at 5%.

• the initial premium payment is $100,000

• the withdrawal benefit bases prior to partial surrender = $100,000

• the remaining withdrawal benefit bases prior to partial surrender = $100,000

• Investment Back (7%) withdrawal benefit payment = $7,000

• “Single Life” For Life (5%) withdrawal benefit payment = $5,000

• Withdrawal taken = $8,000

•excess amount under the Investment Back withdrawal option is $1,000; and

•excess amount under the For Life withdrawal option is $3,000

Example 7

In this example, assume the accumulated value prior to the withdrawal is $90,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,204.82. The new Investment Back withdrawal benefit base is $100,000 - $1,204.82 = $98,795.18.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $1,204.82 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment remaining prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

For Life

The amount of the adjustment* is $3,529.41. The new For Life withdrawal benefit base is $100,000 - $3,529.41 = $96,470.59.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $3,529.41 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Appendix D – Principal Income Builder 10 Examples         120

Investment Back

The amount of the adjustment* is $8,120.48 (the amount of the Investment Back withdrawal benefit plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,120.48 = $91,879.52.

*The amount of the adjustment is (a plus b) where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,120.48 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $1,120.48 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,352.94 (the amount of the “Single Life” For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,352.94 = $91,647.06.

*The amount of the adjustment is (a plus b) where:

a = $5,000 (the actual amount withdrawn that does not exceed the “Single Life” For Life withdrawal benefit payment); and

b = $3,352.94 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $3,352.94 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

y = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $98,795.18 x 0.07 = $6,915.66.

For Life

The new “Single Life” For Life withdrawal benefit payment is $96,470.59 x 0.05 = $4,823.53.

Example 8

In this example, assume the accumulated value prior to the withdrawal is $110,000.

Appendix D – Principal Income Builder 10 Examples         121

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,000 (the amount of the excess withdrawal). The new Investment Back withdrawal benefit base is $100,000 - $1,000 = $99,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $970.87 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000)

For Life

The amount of the adjustment* is $3,000 (the amount of the excess withdrawal). The new For Life withdrawal benefit base is $100,000 - $3,000 = $97,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $2,857.14 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Appendix D – Principal Income Builder 10 Examples         122

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Investment Back

The amount of the adjustment* is $8,000 (the amount of the Investment Back withdrawal benefit payment plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is a plus b where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $902.91 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,000 (the amount of the “Single Life” For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is a plus b where:

a = $5,000 (the actual amount withdrawn that does not exceed the “Single Life” For Life withdrawal benefit payment); and

b = $3,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $2,714.28 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

y = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $99,000 x 0.07 = $6,930.

For Life

The new “Single Life” For Life withdrawal benefit payment is $97,000 x 0.05 = $4,850

Appendix D – Principal Income Builder 10 Examples         123

APPENDIX E – GMWB 2-SL/JL (NO LONGER AVAILABLE FOR SALE)

Appendix E is only applicable to Contract owners who purchased the GMWB 2-SL/JL rider while it was available for sale. The GMWB 2-SL/JL rider was available from January 21, 2008 until August 17, 2012 (or until four business weeks after Principal Income Builder was approved in your state).

For any GMWB 2-SL/JL rider applications signed on or after February 16, 2009, the current annual charge for the rider is 0.95% of the average quarterly Investment Back withdrawal benefit base. The charge is calculated and deducted from youraccumulated value at the end of the calendar quarter at a quarterly rate of 0.2375%, based on the average quarterly Investment Back withdrawal benefit base during the calendar quarter. The average quarterly Investment Back withdrawal benefit base is equal to the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back withdrawal benefit base at the end of the calendar quarter and the sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

For any GMWB 2-SL/JL rider applications signed before February 16, 2009 the current annual charge for the rider is 0.75% of the average quarterly Investment Back withdrawal benefit base. The charge is calculated and deducted from youraccumulated value at the end of the calendar quarter at a quarterly rate of 0.1875%, based on the average quarterly Investment Back withdrawal benefit base during the calendar quarter. The annual charge for the rider was increased to 0.95% of the average quarterly Investment Back withdrawal benefit base at the end of the calendar quarter following the Contract's 2010 anniversary unless you declined the increased rider charge (opting out of future GMWB Step-Ups). For example, if your 2010 Contract anniversary was March 1, 2010, the increased rider charge was effective beginning March 31, 2010 unless you declined the rider charge prior to March 31, 2010. The average quarterly Investment Back withdrawal benefit base is equal to the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back withdrawal benefit base at the end of the calendar quarter and the sum is divided by two.

If we increase the rider charge, you will be notified in advance. Before the effective date of the rider charge increase, you have the following options:

• Accept the increased rider charge and continue to be eligible to receive a GMWB Step-Up at each rider anniversary; or

• Decline the increased rider charge by sending us notice that you are opting out of the GMWB Step-Up and electing to remain at your current rider charge. Once you opt out of the GMWB Step-Up, you will no longer be eligible for any future GMWB Step-Ups and the feature cannot be added back to this rider.

At the end of each calendar quarter (or on the next valuation date, if the calendar quarter ends on a non-valuation date), the rider charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a calendar quarter, the rider charge is prorated according to the number of days this rider is in effect during the calendar quarter. Upon termination of this rider, the rider charge will be based on the number of days this rider is in effect during the calendar quarter.

We reserve the right to increase the rider charge up to the maximum annual charge. If your rider application is signed on or after January 4, 2010, the maximum annual charge is 1.65% (0.4125% quarterly) of the average quarterly Investment Back withdrawal benefit base. If your rider application is signed before January 4, 2010, the maximum annual charge is 1.00% (0.25% quarterly) of the average quarterly Investment Back withdrawal benefit base.

The rider charge is intended to reimburse us for the cost of the protection provided by this rider.

Overview of GMWB 2-SL/JL

Withdrawal options. This rider provides the flexibility of both a For Life withdrawal option and an Investment Back withdrawal option. You are not required to choose between these two withdrawal options unless your Contract accumulated value is zero or you reach the maximum annuitization date.

The For Life withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines as well as the risk of outliving your money. The Investment Back withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines and is designed to permit you to recover at least yourpremium payments.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     124

For Life withdrawal benefit payment percentages. This rider permits an election of “Joint Life” For Life withdrawal benefit payments or “Single Life” For Life withdrawal benefit payments.

Bonus feature. This rider has a Bonus feature (described below) which rewards you for not taking a withdrawal in certain early years of the rider. The GMWB Bonus does not increase your Contract accumulated value.

Step-Up feature. This rider has a Step-Up feature (described below) which can increase your rider withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are made, the division values rise with market growth, or credits (premium payment credits or exchange credit) are applied.

Maximum annual rider charge. This rider has a maximum annual rider charge of 1.65% of the Investment Back withdrawal benefit base.

Spousal continuation. This rider provides that the Investment Back and the For Life withdrawal options may be available to an eligible spouse who continues the Contract with the rider.

Additional death benefit. This rider also allows your eligible beneficiary(ies) to choose a death benefit under the Contract or any death benefit available under the rider.

GMWB 2-SL/JL Rider Restrictions/Limitations

Once elected, this rider may not be terminated for five contract years following the rider effective date.

This rider does not restrict or change your right to take — or not take — withdrawals under the Contract. All withdrawals reduce the Contract accumulated value by the amount withdrawn and are subject to the same conditions, limitations, fees, charges and deductions as withdrawals otherwise taken under the provisions of the Contract; for example, withdrawals will be subject to surrender charges if they exceed the free surrender amount (see 2.CHARGES AND DEDUCTIONS). However, any withdrawals may have an impact on the value of your rider’s benefits. If you take withdrawals in an amount that exceeds an available withdrawal benefit payment (excess withdrawal), you will shorten the life of the rider, lower the withdrawal benefit payments and/or cause the rider to terminate for lack of value unless you make additional premium payments or a GMWB Step-Up is applied.

There is a charge for this rider which can increase up to the guaranteed maximum charge for the rider (see SUMMARY OF EXPENSE INFORMATION).

Election of this rider results in restriction of your Contract investment options to the more limited GMWB investment options (see GMWB Investment Options).

Any ownership change, change of beneficiary or other change before the annuitization date which would cause a change in a covered life may result in termination of this rider (see Covered Life Change).

Factors To Consider Before You Buy The GMWB 2-SL/JL Rider

This rider may be appropriate if you:

• Want to protect against the risk that your Contract accumulated value could fall below your investment due to market decline.

• Want to benefit from potential annual increases in your rider values that match the growth of your Contract accumulated value.

• Want to protect against the risk of you or your spouse outliving your income.

This rider generally will not be appropriate if you:

• Do not intend to take any withdrawals from your Contract.

• Intend to allocate a significant portion of your Contract accumulated value to the Fixed or DCA Accounts.

• Have an aggressive growth investment objective.

• Anticipate you will take withdrawals prior to the oldest owner’s age 59½ or that exceed the rider withdrawal benefit payments of 7% of total premium payments for the Investment Back withdrawal option and 3% to 6.50% of total premium payments for the For Life withdrawal option.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     125

Before you purchase this rider, you should carefully consider the following:

• The features of this rider may not be purchased separately. As a result, you may pay for rider features that you never use.

• Although this rider is designed to permit you to recover at least yourpremium payments, if you take withdrawals that exceed the rider’s withdrawal limits (excess withdrawals), you will shorten the life of the rider, lower the withdrawal benefit payments and/or cause the rider to terminate for lack of value.

• The rider is not a guarantee that the withdrawal benefit payments will be sufficient to meet your future income needs.

• The rider is not a guarantee that you will receive any return on yourpremium payments.

• The rider is not a guarantee that your investment is protected against loss of purchasing power due to inflation.

• The fee for this rider may increase over time due to GMWB Step-Ups, but will not exceed the maximum fee.

• This rider restricts yourinvestment options to investment options that reflect a generally balanced investment objective. The Contract’s more aggressive growth investment options are not available if you elect this rider.

• Once elected, you may not terminate this rider until the fifth Contract anniversary following the rider effective date.

You should review the terms of this rider carefully and work with your registered representative to decide if this rider is appropriate for you based on a thorough analysis of your particular needs, financial objectives, investment goals, time horizons and risk tolerance.

GMWB 2-SL/JL Terms

We use the following definitions to describe the features of this rider:

• Excess Withdrawal — the portion of a withdrawal that exceeds the available withdrawal benefit payment for a withdrawal option.

• GMWB Bonus — a bonus credited to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option, provided certain conditions are met.

• GMWB Step-Up — an increase to the withdrawal benefit base and/or remaining withdrawal benefit base for each withdrawal option to an amount equal to your Contract’s accumulated value on the most recent Contract anniversary, provided certain conditions are met.

• Remaining withdrawal benefit base — the amount available for future withdrawal benefit payments under a withdrawal option. The remaining withdrawal benefit base for each withdrawal option is calculated separately.

• Required minimum distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions in effect as of the rider effective date.

• Rider effective date — the date the rider is issued.

• Withdrawal — any partial surrender (including surrender charges, if any) and/or any partial annuitization of your Contract’s accumulated value.

• Withdrawal benefit base — the basis for determining the withdrawal benefit payment available each year under a withdrawal option. The withdrawal benefit base for each withdrawal option is calculated separately.

• Withdrawal benefit payment — the amount that we guarantee you may withdraw each contract year under a withdrawal option.

GMWB Investment Options

While a GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under a GMWB rider (the “GMWB investment options”) reflect a balanced investment objective and if your investment goal is aggressive growth, a GMWB rider may not support your investment objective. With GMWB investment options that reflect a balanced investment objective, there is potentially a reduced likelihood that we will have to make GMWB benefit payments when the Contract value goes to zero, reaches the maximum annuitization date, or if there is a death claim.

When you purchase a GMWB rider, you must allocate 100% of yourSeparate Account Division value and premium payments to one of the available GMWB investment options. Any future premium payments are allocated to the GMWB investment option yourSeparate Account Division value is invested in at the time of the new premium payments.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     126

The available GMWB investment options are:

• Diversified Growth Account; or

• Diversified Balanced Account; or

• Diversified Income Account.

For more information about the Diversified Growth, Diversified Balanced Account, and Diversified Income Account, see the underlying fund’s prospectus provided with this prospectus.

You may allocate premium payments and transfer Contract accumulated value to the Fixed Account. You may also allocate new premium payments to the DCA Plus accounts. Such allocations and transfers are subject to the provisions of your Contract. See 3. FIXED ACCOUNT AND FIXED DCA PLUS ACCOUNTS.

We reserve the right to modify the list of available of available GMWB investment options, subject to compliance with applicable regulations. Changes or restrictions will apply only to new purchasers of the Contract or to you if youtransfer out of a GMWB investment option and wish to transfer back to that GMWB investment option.

You must stay invested in the GMWB investment options as long as the GMWB rider is in effect. Note, the rider may not be terminated for five contract years following the rider effective date.

Please see APPENDIX B for information regarding transfers between GMWB Investment options, GMWB Investment options Underlying Funds, and Discontinued GMWB Investment options.

Withdrawal Options

For Life Withdrawal Option. This option is intended to help you avoid the risk of out-living your money. You are eligible to take For Life withdrawal benefit payments beginning (i) on the rider effective date if the oldest owner (or the oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or the oldest annuitant, if applicable) attains age 59½. Once eligible, each year you may withdraw an amount up to the annual For Life withdrawal benefit payment until the earlier of the date of the death of the last covered life or the date the For Life withdrawal benefit base reduces to zero.

Investment Back Withdrawal Option. This option is intended to allow a more rapid recovery of yourpremium payments (approximately 14 years). You are eligible to take Investment Back withdrawal benefit payments beginning on the rider effective date. You may withdraw an amount up to the annual Investment Back withdrawal benefit payment until the earlier of the date of your death (annuitant’s death if the owner is not a natural person) or the date the Investment Back remaining withdrawal benefit base equals zero. Under this option, you may take withdrawals prior to the oldest owner attaining age 59½. If you take withdrawals prior to the oldest owner attaining age 59½, the For Life benefit bases will be reduced for excess withdrawals. If the adjustment for the withdrawals causes the For Life withdrawal benefit base to reduce to zero, the For Life withdrawal option will no longer be available to you (unless you make additional premium payments).

Withdrawal Benefit Base

Each withdrawal option has its own withdrawal benefit base, which is used to calculate the annual withdrawal benefit payment for that option. We calculate the withdrawal benefit base for the Investment Back and the For Life withdrawal options separately on

• the rider effective date and

• each Contract anniversary.

The initial withdrawal benefit base for both withdrawal options is equal to the initial premium payment.

On each Contract anniversary, the withdrawal benefit base for each withdrawal option is reset to the greater of 1 or 2, where:

1. is the result of (a + b + c - d), where:

a = prior year withdrawal benefit base (or initial withdrawal benefit base if first Contract anniversary);

b = additional premiums since the previous Contract anniversary (dollar-for-dollar);

c = any GMWB Bonus credited since the previous Contract anniversary;

d = any excess withdrawals taken since the previous Contract anniversary*.

2. is the accumulated value on the Contract anniversary.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     127

* NOTE: The reduction for an excess withdrawal will be greater than dollar-for-dollar if the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal. See Excess Withdrawals later in this section for information about the negative effect of excess withdrawals.

If you take withdrawals prior to the oldest owner attaining age 59½, the For Life benefit bases will be reduced for excess withdrawals. If the adjustment for the withdrawals causes the For Life withdrawal benefit base to reduce to zero, the For Life withdrawal option will no longer be available to you at the next Contract anniversary, unless you make additional premium payments.

Remaining Withdrawal Benefit Base

Each withdrawal option has its own remaining withdrawal benefit base. The remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments under each withdrawal option. We calculate the For Life and the Investment Back remaining withdrawal benefit bases separately on

• the rider effective date,

• when a premium payment is made,

• when any applicable GMWB Bonus is credited,

• when a GMWB Step-Up is applied, and

• when a withdrawal is taken.

The initial remaining withdrawal benefit base for both withdrawal options is equal to the initial premium payment (and likewise equal to the initial withdrawal benefit base) on the rider effective date.

After the rider effective date, the remaining withdrawal benefit base for each withdrawal option will be

• increased dollar-for-dollar by each additional premium payment made, each GMWB Bonus credited, and any GMWB Step-Up; and

• decreased dollar-for-dollar for each withdrawal benefit payment taken; and

• decreased to reflect any excess withdrawals taken since the previous Contract anniversary (the reduction will be greater than dollar-for-dollar, as shown below, if the Contract accumulated value is less than the remaining withdrawal benefit base at the time of the excess withdrawal). See Excess Withdrawals, below, for information about the negative effect that excess withdrawals have on the riders.

Withdrawal Benefit Payments

The Investment Back withdrawal benefit payment is equal to 7% of the Investment Back withdrawal benefit base. The Investment Back withdrawal benefit payments are available as of the rider effective date.

For Life withdrawal benefit payments are available (i) on the rider effective date if the oldest owner (or oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or oldest annuitant, if applicable) attains age 59½.

The For Life withdrawal benefit payments are automatically calculated as “Single Life” unless you provide notice and good order instructions to select “Joint Life” For Life withdrawal benefit payments. If eligible, you may elect “Joint Life” For Life withdrawal benefit payments anytime on or before your first withdrawal following the rider effective date. Once you take this first withdrawal, you cannot change your election of “Single Life” or “Joint Life” For Life withdrawal benefit payments, regardless of any change in life events.

“Single Life” For Life withdrawal benefit payments. “Single Life” For Life withdrawal benefit payments are based on one covered life. The covered life for “Single Life” is the

a. owner if there is only one owner;

b. annuitant if the owner is not a natural person;

c. youngest joint owner if there are joint owners; or

d. youngest annuitant if there are joint annuitants and the owner is not a natural person.

In addition, the covered life must satisfy this rider’s issue age requirements on the date the covered life is designated in accordance with the terms of this rider.

As long as the Contract is in effect, “Single Life” or “Joint Life” For Life withdrawal benefit payments may be taken until the earlier of the date of the death of the first owner to die (first annuitant, if applicable) or the date the For Life withdrawal benefit base reduces to zero.

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“Joint Life” For Life withdrawal benefit payments. “Joint Life” For Life withdrawal benefit payments are based on two covered lives. You may only elect “Joint Life” For Life withdrawal benefit payments if there are two covered lives that meet the eligibility requirements. There can be no more than two covered lives. The “Joint Life” election is not available if the owner is not a natural person.

To be eligible for “Joint Life” the covered lives must be

a. the owner and the owner’s spouse, provided there is only one owner and the spouse is named as a primary beneficiary; or

b. the joint owners, provided the joint owners are each other’s spouse.

NOTE: Under the Internal Revenue Code (the “Code”), spousal continuation and certain distribution options are available only to a person who is defined as a “spouse” under the Federal Defense of Marriage Act or other applicable Federal Law. All Contract provisions will be interpreted and administered in accordance with the requirements of the Code.

NOTE: At the time a covered life is designated, that covered life must satisfy this rider’s issue age requirements.

As long as the Contract is in effect, “Joint Life” For Life withdrawal benefit payments will continue until the earlier of the date of the death of the last covered life or the date the “For Life” withdrawal benefit base reduces to zero.

Calculating the For Life Withdrawal Benefit Payment

The For Life withdrawal benefit payment is an amount equal to a percentage multiplied by the For Life withdrawal benefit base.

The For Life withdrawal benefit payment percentage depends on whether you have elected “Single Life” or “Joint Life” and the age of the covered life on the date of the first withdrawal following the rider effective date:

• “Single Life”:

Age of Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.50%
50-54	4.00%
55-59	4.50%
60-69	5.00%
70-74	5.50%
75-79	6.00%
80+	6.50%

• “Joint Life”:

Age of Younger Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.00%
50-54	3.50%
55-59	4.00%
60-69	4.50%
70-74	5.00%
75-79	5.50%
80+	6.00%

NOTE: All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Under 72t, a customer can receive substantially equal payments without an IRS tax penalty, even if under age 59½. If you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals. See Excess Withdrawals for additional information.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     129

Because the For Life withdrawal benefit payments are tiered based on the age of the younger covered life at the time of the first withdrawal, you should carefully choose when you take the first withdrawal following the rider effective date. Once a withdrawal is taken, the For Life withdrawal benefit payment percentage is locked in for the life of this rider. In addition, when you take your first withdrawal, your election of “Single Life” or “Joint Life” remains locked in and cannot be changed. For example, if you have elected “Joint Life” For Life withdrawal benefit payments and take the first withdrawal when the younger covered life is age 46, your For Life withdrawal benefit payment percentage will be locked in at 3.00% for the remaining life of this rider and cannot be changed.

Covered Life Change

Any ownership change, change of beneficiary or other change before the annuitization date which would cause a change in a covered life (a “Change”) will result in termination of this rider, except for the following permissible Changes:

1. Spousal continuation of this rider as described below in Spousal Continuation.

2. If withdrawals have not been taken and you have not previously elected to continue this rider as provided in Spousal Continuation, then

a. you may add a joint owner or primary beneficiary to your Contract as a covered life, provided that the new joint owner or primary beneficiary is an eligible covered life as set forth above.

b. you may remove a joint owner or primary beneficiary as a covered life.

c. the For Life withdrawal benefit payment percentage will be based on the age of the covered lives and will lock in at the percentage applicable on the date of your first withdrawal.

3. If withdrawals have been taken and you have locked in “Single Life” For Life withdrawal benefit payments, then

a. you may remove a joint owner as a covered life.

b. you may add a primary beneficiary to your Contract, however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. the For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

4. If withdrawals have been taken and you have locked in “Joint Life” For Life withdrawal benefit payments, then

a. you may remove a joint owner or primary beneficiary as a covered life.

b. you may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider.

c. the For Life withdrawal benefit payment percentage will remain locked in at the percentage applicable on the date of your first withdrawal and will not be reset to reflect the removal of the covered life. For Life withdrawal benefit payments will cease upon your death.

5. If you have previously elected to continue this rider as provided in Spousal Continuation, then you may add a primary beneficiary to your Contract; however, you may not add a primary beneficiary as a covered life for purposes of this rider. If the primary beneficiary that you add is your spouse, upon your death the spouse can continue the Contract, but the rider will terminate.

No Change is effective until approved by us in writing. Upon our approval, the Change is effective as of the date you signed the notice requesting the Change.

An assignment of the Contract or this rider shall be deemed a request for a Change. If the Change is not one of the above permissible Changes, this rider will be terminated as of the date of the assignment.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     130

Effect of Withdrawals

This rider does not require you to take an available withdrawal benefit payment. If you want to take advantage of this rider’s GMWB Bonus feature, withdrawals cannot be taken during the period the GMWB Bonus is available. Please see GMWB Bonus below.

If you elect not to take an available withdrawal benefit payment, that amount will not be carried forward to the next contract year.

Each time you take a withdrawal, it is reflected immediately in your Contract accumulated value and in the remaining withdrawal benefit base for each withdrawal option.

If you take excess withdrawals, the withdrawal benefit base for each withdrawal option will be reduced on the next Contract anniversary. See Excess Withdrawals for information about the negative effect of excess withdrawals.

To help you better understand the various features of this rider and to demonstrate how premium payments made and withdrawals taken from the Contract affect the values and benefits under this rider, we have provided several examples at the end of this appendix.

Excess Withdrawals

Any withdrawals that exceed the available withdrawal benefit payments for either withdrawal option are excess withdrawals. Excess withdrawals decrease the withdrawal benefit bases, which will reduce future withdrawal benefit payments.

All withdrawals prior to the Contract anniversary following the oldest owner’s (oldest annuitant’s, if applicable) age 59½ are treated as excess withdrawals when calculating the For Life withdrawal benefit. Therefore, if you receive 72t distributions and have not reached the Contract anniversary after the oldest owner’s (oldest annuitant’s, if applicable) age 59½, these 72t distributions will be treated as excess withdrawals.

The Investment Back withdrawal option permits larger payment to you than the For Life withdrawal option. As a result, if you take a withdrawal in an amount permitted under the Investment Back withdrawal option, that withdrawal will be an excess withdrawal to the extent that it exceeds the applicable For Life withdrawal benefit payment.

Excess withdrawals reduce withdrawal benefit payments, the withdrawal benefit bases, and the remaining withdrawal benefit bases for the two withdrawal options. The reductions can be greater than dollar-for-dollar when the Contract accumulated value is less than the applicable rider withdrawal benefit base at the time of the excess withdrawal.

The withdrawal benefit base is used to determine the withdrawal benefit payment whereas the remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments. These two values are calculated differently and have different purposes; therefore, the excess withdrawal adjustment for each will vary. If you choose to take an excess withdrawal, the equations below show how to calculate the excess withdrawal adjustment.

Effect on withdrawal benefit base. Excess withdrawals will reduce each of the withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the withdrawal benefit base prior to the adjustment for the excess withdrawal.

Effect on remaining withdrawal benefit base. Excess withdrawals will reduce each of the remaining withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the remaining withdrawal benefit base prior to the adjustment for the excess withdrawal.

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NOTE: All withdrawals taken prior to the date that the oldest owner (oldest annuitant, if applicable) has met the For Life age eligibility requirement are excess withdrawals.

NOTE: For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the required minimum distribution for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals. (See Required Minimum Distribution (RMD) Program for GMWB Riders).

NOTE: Withdrawals prior to age 59½ may be subject to a 10% IRS penalty tax.

Required Minimum Distribution (RMD) Program for GMWB Riders

Tax-qualified contracts are subject to certain federal tax rules requiring that RMD be taken on a calendar year basis (i.e., compared to a contract year basis), usually beginning after age 72.

If you are eligible for and enroll in our RMD Program for GMWB Riders, as discussed below, a withdrawal taken to satisfy RMD for the Contract (an “RMD amount”) that exceeds a withdrawal benefit payment for that contract year will not be deemed an excess withdrawal.

RMD Program. Eligibility in the RMD Program for GMWB Riders is determined by satisfaction of the following requirements:

• your Contract may not have the Enhanced Death Benefit Rider;

• the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of the Internal Revenue Code is based only on this Contract (the “RMD amount”); and

• you have elected scheduled withdrawal payments.

NOTE: Although enrollment in the RMD Program for GMWB Riders does not prevent you from taking an unscheduled withdrawal, an unscheduled withdrawal will cause you to lose the RMD Program protections for the remainder of the contract year. This means that any withdrawals (scheduled or unscheduled) during the remainder of the contract year that exceed applicable withdrawal benefit payments will be treated as excess withdrawals, even if the purpose is to take the RMD amount.You will automatically be re-enrolled in the RMD Program for GMWB Riders on your next Contract anniversary.

We reserve the right to modify or eliminate the RMD Program for GMWB Riders; for example, if there is a change to the Internal Revenue Code or Internal Revenue Service rules or interpretations relating to RMD, including the issuance of relevant IRS guidance. We will send you at least 30 days advance notice of any change in or elimination of the RMD Program for GMWB Riders. Any modifications or elimination of the RMD Program for GMWB Riders will take effect after notice. If we exercise our right to modify or eliminate the RMD Program for GMWB Riders, then any scheduled or unscheduled withdrawal in excess of a withdrawal benefit payment after the effective date of the program’s modification or elimination will be deemed an excess withdrawal.

For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the RMD for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals.

You may obtain more information regarding our RMD Program for GMWB Riders by contacting your registered representative or by calling us at 1-800-852-4450.

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GMWB Bonus

Under the GMWB Bonus, on each of the first three Contract anniversaries following the rider effective date, we will credit a bonus (“GMWB Bonus”) to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option, provided you have not taken any withdrawals since the rider effective date.

The GMWB Bonus is equal to the total of all premium payments made prior to the applicable Contract anniversary multiplied by the applicable percentage shown in the chart below. If the contract date and the rider effective date are different, the GMWB Bonus is equal to the Contract accumulated value on the rider effective date plus premium payments made between the rider effective date and the Contract anniversary, multiplied by the applicable percentage shown in the chart below.

Contract Anniversary (following the rider effective date)	GMWB Bonus Percentage
1	7.00%
2	6.00%
3	5.00%

The GMWB Bonus is no longer available after the earlier of

• The third Contract anniversary following the rider effective date; or

• The date you take a withdrawal following the rider effective date.

NOTE: The GMWB Bonus is used only for the purposes of calculating the withdrawal benefit bases and the remaining withdrawal benefit bases for each withdrawal option. The GMWB Bonus is not added to your Contract accumulated value.

GMWB Step-Up

The GMWB Step-Up is automatic and applies annually. Under this rider, unless an owner opts out of the automatic GMWB Step-Up, the rider charge will increase if our then current rider charge is higher than when the rider was purchased. The rider charge will never be greater than the maximum GMWB 2-SL/JL rider charge. See SUMMARY OF EXPENSE INFORMATION section.

We determine eligibility for a GMWB Step-Up of the withdrawal benefit base and remaining withdrawal benefit base for each withdrawal option separately. If you satisfy the eligibility requirements on a Contract anniversary and your Contract accumulated value is greater than the applicable withdrawal benefit base, we will Step-Up the applicable withdrawal benefit base and remaining withdrawal benefit base to your Contract accumulated value on that Contract anniversary. We will not reduce your withdrawal benefit base or remaining withdrawal benefit base if your Contract accumulated value on a Contract anniversary is less than a withdrawal benefit base.

If you are eligible for a GMWB Step-Up of a withdrawal benefit base or remaining withdrawal benefit base, you will be charged the then current rider charge. You may choose to opt out of the GMWB Step-Up feature if the charge for your rider will increase. We will send you advance notice if the charge for your rider will increase in order to give you the opportunity to opt out of the GMWB Step-Up feature. Once you opt out, you will no longer be eligible for future GMWB Step-Ups.

The GMWB Step-Up operates as follows:

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of a withdrawal benefit base if you satisfy all of the following requirements:

1. the Contract anniversary occurs before the later of

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. ten years after the rider effective date;

2. you have not declined any increases in the rider charge; and

3. you have not fully annuitized the Contract.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     133

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of a remaining withdrawal benefit base if you satisfy all of the following requirements:

1. the Contract anniversary occurs before the later of

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. ten years after the rider effective date;

2. you have not declined any increases in the rider charge;

3. you have not fully annuitized the Contract; and

4. the remaining withdrawal benefit base has not reduced to zero during the life of the rider.

NOTE: A remaining withdrawal benefit base under a withdrawal option is not eligible for a GMWB Step-Up after that remaining withdrawal benefit base reduces to zero, even if additional premium payments are made.

Effect of Reaching the Maximum Annuitization Date Under the Rider

On or before the maximum annuitization date, you must elect one of the Contract or GMWB rider payment options described below.

1. Contract payment options:

• Payments resulting from applying the Contract accumulated value to an annuity benefit payment option.

• Payment of the Contract accumulated value as a single payment.

2. GMWB rider payment options:

• You may elect the Investment Back withdrawal option and receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment, until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death (death of the first annuitant to die if the owner is not a natural person), we will continue payments as described in GMWB 2-SL/JL Upon Death.

• You may elect the For Life withdrawal option and receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment, until the later of

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of death of the last covered life.

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 2-SL/JL Upon Death.

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of rider withdrawal benefit payments.

Please see Effect of Withdrawals for information on how withdrawals prior to the maximum annuitization date affect the GMWB values.

We will send you written notice at least 30 days prior to the maximum annuitization date and ask you to select one of the available payment options listed above. If we have not received your election as of the maximum annuitization date, we will automatically apply your Contract accumulated value to an annuity benefit payment option:

• for Contracts with one annuitant – Life Income with payments guaranteed for a period of 10 years.

• for Contracts with joint annuitants – Joint and Full Survivor Income with payments guaranteed for a period of 10 years.

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Effect of the Contract Accumulated Value Reaching Zero Under the Rider

We will send you prior written notice whenever reasonably feasible if your Contract accumulated value is approaching zero.

In the event that the Contract accumulated value reduces to zero, you must elect either

• the Investment Back withdrawal option (only available if the Investment Back remaining withdrawal benefit base is greater than zero; please see Effect of Withdrawals); or

• the For Life withdrawal option (only available if the For Life withdrawal benefit base is greater than zero; please see Effect of Withdrawals).

If we have not received your election or if you are receiving Investment Back scheduled withdrawal benefit payments, we will automatically begin making withdrawal benefit payments to you under the Investment Back withdrawal option, unless:

• You have been receiving For Life scheduled withdrawal benefit payments. We will automatically continue to make payments to you under the For Life withdrawal option.

• The Investment Back remaining withdrawal benefit base is zero. We will automatically begin making payments under the Single Life For Life withdrawal option.

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of withdrawal benefit payments.

We will pay the withdrawal benefit payments under the withdrawal option you have elected as follows:

• If you elect the Investment Back withdrawal option, you will receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 2-SL/JL Upon Death.

• If you have taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, your For Life withdrawal option is either “Joint Life” or “Single Life” depending on your election at the time of your first withdrawal.

• If you have not taken withdrawal benefit payments prior to the Contract accumulated value reaching zero, you must elect either

• the “Single Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Single Life” For Life withdrawal benefit payment, until the later of

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of your death (annuitant’s death if the owner is not a natural person).

• the “Joint Life” For Life withdrawal option: you will receive fixed scheduled payments each year in the amount of the “Joint Life” For Life withdrawal benefit payment, until the later of

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of the death of the last covered life.

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 2-SL/JL Upon Death.

NOTE: In the event that the Contract accumulated value reduces to zero, the withdrawal benefit payments elected above will continue, but all other rights and benefits under this rider and the Contract (including the death benefits) will terminate, and no additional premium payments will be accepted.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     135

GMWB 2-SL/JL Upon Death

If the Contract Accumulated Value is Greater than Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is greater than zero at your death.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The primary beneficiary(ies) must elect one of the following: a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only your beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may a. continue the Contract with or without this rider as set forth in Spousal Continuation of the Rider; or b. elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** All other primary beneficiaries must elect one of the options listed above in b. Unless your spouse elects to continue the Contract with this rider, only your spouse’s and beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is not your spouse	Your surviving owner must elect one of the following a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only the surviving owner’s right to the above selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may a. continue the Contract with or without this rider as set forth below in Spousal Continuation of the Rider; or b. elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** Unless the surviving spouse owner elects to continue the Contract with this rider, upon your death, only your spouse’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

* Please see 8.DEATH BENEFIT for an explanation of the Contract’s death benefit and payment options available for the Contract’s death benefit.

** We will make payments in an amount and frequency acceptable to us. If a surviving owner or beneficiary chooses a periodic payment, it must be at least $100 per payment until the Investment Back remaining withdrawal benefit base is zero.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     136

If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receive the death benefit under the Contract. If a beneficiary dies before the annuitant, on the annuitant's death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. If no beneficiary(ies) survive the annuitant, the death benefit is paid to the owner. Upon the annuitant's death, only the beneficiary(ies) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

If the Contract Accumulated Value is Zero. The following table illustrates the various situations and the resulting outcomes if the Contract accumulated value is zero at your death.

If you die and…	And…	Then…
You are the sole owner	You elected the “Single Life” For Life withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the “Joint Life” For Life withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life's death. Upon the surviving covered life's death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the Investment Back withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the “Single Life” For Life withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the “Joint Life” For Life withdrawal option*	We will continue payments to the surviving covered life according to the schedule established when you made your election until the date of the surviving covered life’s death. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     137

If you die and…	And…	Then…
You are a joint owner	You elected the Investment Back withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.

* Please see Effect of the Contract Accumulated Value Reaching Zerounder the Rider for details regarding election of the For Life withdrawal option or the Investment Back withdrawal option.

NOTE: The “Joint Life” For Life withdrawal option is not available if the owner is not a natural person.

If...	And...	Then...
The annuitant dies	The owner is not a natural person The owner elected the “Single Life” For Life Withdrawal option* The owner elected the Investment Back withdrawal option*	The beneficiary(ies) receive the death benefit under the Contract. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the For Life remaining withdrawal benefit base reduces to zero. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the Investment Back remaining withdrawal benefit base reduces to zero.

Termination and Reinstatement of the Rider

You may not terminate this rider prior to the 5th Contract anniversary following the rider effective date.

At any point in time, we will terminate this rider upon the earliest to occur:

• The date you send us notice to terminate the rider (after the 5th Contract anniversary following the rider effective date). This will terminate the rider, not the Contract.

• The date you fully annuitize, fully surrender or otherwise terminate the Contract.

• The date the Investment Back remaining withdrawal benefit base and the For Life withdrawal benefit base are both zero.

• The date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except a change in owner due to a spousal continuation of the rider as described in Spousal Continuation of the Rider or the removal/ addition of a joint life as described in Covered Life Change.

• The date your surviving spouse elects to continue the Contract without this rider (even if prior to the fifth Contract anniversary following the rider effective date).

• The date the Investment Back remaining withdrawal benefit base is zero and there are no eligible covered lives.

• The date you make an impermissible change in a covered life.

If this rider terminates for any reason other than full surrender of the Contract, this rider may not be reinstated.

If you surrender the Contract with this rider attached and the Contract is later reinstated, this rider also must be reinstated. At the time this rider is reinstated, we will deduct rider charges scheduled during the period of termination and make any other adjustments necessary to reflect any changes in the amount reinstated and the Contract accumulated value as of the date of termination.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     138

Spousal Continuation of the Rider

This rider provides that the Investment Back and the For Life withdrawal options may be available in certain situations to an eligible spouse who continues the Contract with the rider.

If you die while this rider is in effect and if your surviving spouse elects to continue the Contract in accordance with its terms, the surviving spouse may also elect to continue this rider if

1. the Contract accumulated value is greater than zero;

2. there has not been a previous spousal continuation of the Contract and this rider; and

3. your spouse is either

a.    your primary beneficiary, if you were the sole owner; or

b.    the surviving joint owner, if there were joint owners.

If your spouse elects to continue the Contract without this rider, this rider and all rights, benefits and charges under this rider will terminate and cannot be reinstated.

NOTE: Although spousal continuation may be available under federal tax laws for a subsequent spouse, this rider may be continued one time only.

The following table illustrates the various changes and the resulting outcomes associated with continuation of this rider by an eligible surviving spouse.

If you die and…	And…	Then if your spouse continues this Contract…
No withdrawals have been taken since the rider effective date	Your spouse meets the minimum issue age requirement	Your spouse may take withdrawals under either withdrawal option as follows: a. The For Life withdrawal option will be available until the earlier of the death of your spouse or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will automatically be calculated as “Single Life” and your spouse will be the sole covered life. Your spouse may not add a new covered life or elect “Joint Life”. The For Life withdrawal benefit percentage will be based on your spouse’s age and will lock in at the “Single Life” percentage applicable on the date of your spouse’s first withdrawal. b. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base is zero. c. All other provisions of this rider will continue as in effect on the date of your death.
No withdrawals have been taken since the rider effective date	Your spouse does not meet the minimum issue age requirement	The For Life withdrawal option terminates upon your death. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base is zero. b. All other provisions of this rider will continue as in effect on the date of your death.

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If you die and…	And…	And…	Then if your spouse continues this Contract…
Withdrawals have been taken since the rider effective date	You have locked in “Single Life” For Life withdrawal benefits	---	The For Life withdrawal option terminates upon the death of the first owner to die. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. b. All other provisions of this rider will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	Your spouse is the surviving covered life	Your spouse may take withdrawals under either withdrawal option as follows: a. The For Life withdrawal option will continue to be available until the earlier of the death of your spouse or the For Life withdrawal benefit base reduces to zero. For Life withdrawal benefits will continue to be calculated as “Joint Life”. The For Life withdrawal benefit percentage will remain locked in at the “Joint Life” percentage applicable on the date of your first withdrawal and will not be reset to reflect your death. b. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. c. All other provisions of this rider will continue as in effect on the date of your death.
Withdrawals have been taken since the rider effective date	You have locked in “Joint Life” For Life withdrawal benefits	There is no surviving covered life	The For Life withdrawal option terminates upon your death. Your spouse may take withdrawals under the Investment Back withdrawal option as follows: a. The Investment Back withdrawal option will continue to be available until the Investment Back remaining withdrawal benefit base reduces to zero. b. All other provisions of this rider will continue as in effect on the date of your death.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     140

Effect of Divorce on the Rider

The following table illustrates divorce situations and the resulting outcomes.

If…	And…	Then…
You are the sole owner of the contract	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. You will retain all rights and benefits of the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.
You are the sole owner of the contract	You direct us to change ownership of the Contract to your former spouse to satisfy a court order	The GMWB rider will terminate. Your former spouse will become the new owner of the Contract and will retain all rights and benefits of the Contract.
Contract is jointly owned	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	If no withdrawals have been taken, the withdrawal will be taken based on the “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file unless you direct otherwise. If withdrawals have been taken, the withdrawal will be based on the For Life withdrawal benefit election on file. Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. If you direct us to remove one of the joint owners, the spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.
Contract is jointly owned	You direct us to remove one of the joint owners to satisfy a court order	If withdrawals have been taken, “Single Life” or “Joint Life” For Life withdrawal benefit payment election on file will remain in effect. If withdrawals have not been taken, For Life withdrawal benefits will be calculated “Single Life”. The spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.

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GMWB 2- SL/JL (Single Life/Joint Life) Rider -- Investment Protector Plus 2 Summary

Name of Rider	GMWB 2 - SL/JL
Marketing Name	Investment Protector Plus 2 Rider
Rider Issue Age	45 – 80
Rider Charge	GMWB 2 -SL/JL Rider Charges (as a percentage of average quarterly Investment Back withdrawal benefit base) •Maximum annual charge for rider applications signed before January 4, 2011 is 1.00%. •Maximum annual charge for rider applications signed on or after January 4, 2011 is 1.65%. •Current annual charge for rider applications signed before February 16, 2009 and you opt out of future GMWB Step-Ups after the Contract’s 2011 anniversary (for more details see 2.CHARGES AND DEDUCTIONS)  is 0.75%. •Current annual charge for rider applications signed before February 16, 2009 and you do not opt out of future GMWB Step-Ups after the Contract’s 2011 anniversary (for more details see 2. CHARGES AND DEDUCTIONS) is 0.95%. •Current annual charge for rider applications signed on or after February 16, 2009 is 0.95%.
Guaranteed Minimum Withdrawal Benefits	•Investment Back •For Life
Annual Withdrawal Limits	•Investment Back — 7.00% of the Investment Back withdrawal benefit base. •“Single Life” — tiered percentages based on age at first withdrawal, beginning at 3.50% and capping at a maximum of 6.50% of the For Life withdrawal benefit base •“Joint Life” — tiered percentages based on age at first withdrawal, beginning at 3.00% and capping at a maximum of 6.00% of the For Life withdrawal benefit base
For Life Withdrawal Benefit Payments	•“Single Life” or “Joint Life” (your life and the lifetime of your eligible spouse) •For Life withdrawal benefit payments default to “Single Life” unless “Joint Life” is elected •Available the Contract anniversary following the date the oldest owner turns 59½ — all withdrawals prior to that Contract anniversary are excess withdrawals under the For Life withdrawal option
Termination	•You may terminate this rider anytime after the 5th Contract anniversary following the rider effective date
GMWB Step-Up	•Automatic annual GMWB Step-Up available until the later of (a) the Contract Anniversary prior to age 80 or (b) 10 years after the rider effective date. •A remaining withdrawal benefit base under a withdrawal option is not eligible for a GMWB Step-Up after the remaining withdrawal benefit base reduces to zero, even if additional premium payments are made.
GMWB Bonus	•If no withdrawals are taken, a GMWB Bonus is applied to the benefit bases on each Contract anniversary as shown below. •Year 1 — 7.00% of premium payments •Year 2 — 6.00% of premium payments •Year 3 — 5.00% of premium payments
Investment Restrictions	•You must select one of the available GMWB investment options; there are no additional restrictions on allocations to the Fixed Account or DCA Plus accounts.
Spousal Continuation	•At the death of the first owner to die, a spouse who is a joint owner or primary beneficiary may continue the Contract with or without this rider. •The Investment Back withdrawal option continues; the For Life withdrawal option continues only for eligible spouses.

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EXAMPLES

These examples have been provided to assist you in understanding the various features of the GMWB 2-SL/JL rider and to demonstrate how premium payments received and withdrawals taken from the Contract affect the values and benefits under the GMWB 2-SL/JL rider. These examples are based on certain hypothetical assumptions and are for illustrative purposes only. These examples are not intended to serve as projections of future investment returns.

NOTE:    The owner’s actions determine the benefits received.

NOTE: For the purpose of the following examples, a partial annuitization has the same effect as a partial surrender and both are referred to as a withdrawal in the following examples.

Examples Without Excess Withdrawals (Examples 1-5)

The examples without excess withdrawals assume the following:

• the client is age 62 and the client’s spouse is age 60 on the rider effective date.

• initial premium payment = $100,000.

• the withdrawal benefit bases prior to partial surrender = $100,000.

• the remaining withdrawal benefit bases prior to partial surrender = $100,000.

• Investment Back (7%) withdrawal benefit payment = $7,000.

• “Single Life” For Life (5%) withdrawal benefit payment = $5,000, if withdrawals start prior to the client attaining age 70.

• “Joint Life” For Life (4.5%) withdrawal benefit payment = $4,500, if withdrawals start prior to the spouse attaining age 70.

Example 1

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the client has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + 7,000 = $107,000;

•the new Investment Back remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

•the new Investment Back withdrawal benefit payment is $107,000 x 0.07 = $7,490.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + 7,000 = $107,000;

• the new For Life remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

• the new “Single Life” For Life withdrawal benefit payment is $107,000 x 0.05 = $5,350.

Example 2

In contract year one:

• no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the client has not made a For Life withdrawal benefit payment election, we automatically calculate the For Life withdrawal benefit payment as “Single Life”.

• the client makes a premium payment of $50,000.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is ($100,000 + $50,000) x 0.07 = $10,500.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500;

• the new Investment Back remaining withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500; and

•the new Investment Back withdrawal benefit payment is $160,500 x 0.07 = $11,235.

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• For Life:

• the new For Life withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500;

• the new For Life remaining withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500; and

• the new “Single Life” For Life withdrawal benefit payment is $160,500 x 0.05 = $8,025.

Example 3

In contract year one, the client elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,500. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.5%.

On the first Contract anniversary:

• Since a withdrawal was taken in contract year one, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

• the withdrawal benefit base remains the same ($100,000);

• the new remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.07 = $7,000).

• For Life:

• the For Life withdrawal benefit base remains the same ($100,000);

• the new For Life remaining withdrawal benefit base is $100,000 - $4,500 = $95,500; and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.045 = $4,500).

Example 4

In contract year one, no withdrawals are taken and no For Life withdrawal benefit payment election has been designated. Because the client has not made a For Life withdrawal benefit payment election, we automatically calculate For Life withdrawal benefit payment as “Single Life”.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + 7,000 = $107,000;

• the new Investment Back remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

• the new Investment Back withdrawal benefit payment is $107,000 x 0.07 = $7,490.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + 7,000 = $107,000;

• the new For Life remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

• the new “Single Life” For Life withdrawal benefit payment is $107,000 x 0.05 = $5,350.

In contract year two, the client elects the “Joint Life” For Life withdrawal benefit payment and takes a withdrawal of $4,500. The “Joint Life” For Life withdrawal benefit payment percentage is locked-in at 4.5%.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($107,000);

•the new Investment Back remaining withdrawal benefit base is $107,000 - $4,500 = $102,500; and

•the Investment Back withdrawal benefit payment for the next contract year remains the same ($107,000 x 0.07 = $7,490).

• For Life:

• the For Life withdrawal benefit base remains the same ($107,000);

• the new For Life remaining withdrawal benefit base is $107,000 - $4,500 = $102,500; and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year is $107,000 x 0.045 = $4,815.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     144

In contract year three, no withdrawals are taken. The “Joint Life” For Life withdrawal benefit payment percentage remains locked-in at 4.5%.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the withdrawal benefit bases are larger than the Contract’s accumulated value.

• Investment Back:

• the Investment Back withdrawal benefit base remains the same ($107,000);

• the Investment Back remaining withdrawal benefit base remains the same ($102,500); and

• the Investment Back withdrawal benefit for the next contract year remains the same ($107,000 x 0.07 = $7,490).

• For Life:

• the For Life withdrawal benefit base remains the same ($107,000);

• the For Life remaining withdrawal benefit base remains the same ($102,500); and

• the “Joint Life” For Life withdrawal benefit payment for the next contract year remains the same ($107,000 x 0.045 = $4,815).

Example 5

The client elects the “Single Life” For Life withdrawal benefit payment, and in each of the first two contract years, takes a withdrawal of $5,000. Assume there is no GMWB Step-Up on the first Contract anniversary. On the 2nd Contract anniversary, the client will receive GMWB Step-Up if the Contract’s accumulated value is greater than the applicable withdrawal benefit base.

If the accumulated value on the second contract anniversary is:	$95,000	$110,000
Investment Back
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$100,000 x 0.07 = $7,000
Remaining Withdrawal Benefit Base	$90,000	$90,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$110,000 x 0.07 = $7,700
Remaining Withdrawal Benefit Base	$90,000	$110,000
For Life (“Single Life”)
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$100,000 x 0.05 = $5,000
Remaining withdrawal Benefit Base	$90,000	$90,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$110,000 x 0.05 = $5,500
Remaining Withdrawal Benefit Base	$95,000	$110,000

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     145

Examples With Excess Withdrawals (Examples 6-7)

The excess withdrawal examples assume the following:

• the client is age 62 and elected “Single Life” For Life withdrawal benefit payments at the first withdrawal and therefore, locks-in the “Single Life” For Life withdrawal benefit payment percentage at 5%.

• the initial premium payment is $100,000

• the withdrawal benefit bases prior to partial surrender = $100,000

• the remaining withdrawal benefit bases prior to partial surrender = $100,000

• Investment Back (7%) withdrawal benefit payment = $7,000

• “Single Life” For Life (5%) withdrawal benefit payment = $5,000

• Withdrawal taken = $8,000

•excess amount under the Investment Back withdrawal option is $1,000; and

•excess amount under the For Life withdrawal option is $3,000

Example 6

In this example, assume the accumulated value prior to the withdrawal is $90,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,204.82. The new Investment Back withdrawal benefit base is $100,000 - $1,204.82 = $98,795.18.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $1,204.82 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment remaining prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

For Life

The amount of the adjustment* is $3,529.41. The new For Life withdrawal benefit base is $100,000 - $3,529.41 = $96,470.59.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $3,529.41 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

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Investment Back

The amount of the adjustment* is $8,120.48 (the amount of the Investment Back withdrawal benefit plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,120.48 = $91,879.52.

*The amount of the adjustment is (a plus b) where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,120.48 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $1,120.48 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,352.94 (the amount of the “Single Life” For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,352.94 = $91,647.06.

*The amount of the adjustment is (a plus b) where:

a = $5,000 (the actual amount withdrawn that does not exceed the “Single Life” For Life withdrawal benefit payment); and

b = $3,352.94 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $3,352.94 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

y = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $98,795.18 x 0.07 = $6,915.66.

For Life

The new “Single Life” For Life withdrawal benefit payment is $96,470.59 x 0.05 = $4,823.53.

Example 7

In this example, assume the accumulated value prior to the withdrawal is $110,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     147

Investment Back

The amount of the adjustment* is $1,000 (the amount of the excess withdrawal). The new Investment Back withdrawal benefit base is $100,000 - $1,000 = $99,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $970.87 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000)

For Life

The amount of the adjustment* is $3,000 (the amount of the excess withdrawal). The new For Life withdrawal benefit base is $100,000 - $3,000 = $97,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $2,857.14 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

2 = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Investment Back

The amount of the adjustment* is $8,000 (the amount of the Investment Back withdrawal benefit payment plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is a plus b where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $902.91 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     148

For Life

The amount of the adjustment* is $8,000 (the amount of the “Single Life” For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is a plus b where:

a = $5,000 (the actual amount withdrawn that does not exceed the “Single Life” For Life withdrawal benefit payment); and

b = $3,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $2,714.28 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the “Single Life” For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

y = the accumulated value after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the “Single Life” For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The “Single Life” For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $99,000 x 0.07 = $6,930.

For Life

The new “Single Life” For Life withdrawal benefit payment is $97,000 x 0.05 = $4,850.

Appendix E – GMWB 2 SL/JL (No Longer Available for Sale)     149

APPENDIX F — GMWB 2-SL (NO LONGER AVAILABLE FOR SALE)

GMWB 2-SL Rider – Investment Protector Plus 2

Appendix F is only applicable to Contract owners who purchased the GMWB 2-SL rider while it was available for sale. The GMWB 2-SL rider was available from June 8, 2007 until January 21, 2008 (or until GMWB 2-SL/JL was approved in your state).

For the GMWB 2-SL rider, the current annual charge for the rider is 0.75% of the average quarterly Investment Back withdrawal benefit base. The charge is taken at the end of each calendar quarter at 0.1875%, based on the average quarterly Investment Back withdrawal benefit base during the calendar quarter. The annual charge for the rider will increase to 0.95% of the average quarterly Investment Back withdrawal benefit base at the end of the calendar quarter following the Contract's 2010 anniversary unless you decline the increased rider charge (opting out of future GMWB Step-Ups). For example, if your 2010 Contract anniversary was March 1, 2010, the increased rider charge was effective beginning March 31, 2010 unless you declined the rider charge prior to March 31, 2010. The average quarterly Investment Back withdrawal benefit base is equal to the Investment Back withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back withdrawal benefit base at the end of the calendar quarter and the sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

If we increase the rider charge, you will be notified in advance. When there is a rider charge increase, you have the following options before the effective date of the change:

• Accept the increased rider charge and continue to be eligible to receive a GMWB Step-Up at each Contract anniversary; or

• Decline the increased rider charge by sending us notice that you are opting out of the Step-Up feature of this rider and electing to remain at your current rider charge. Once you opt out of the Step-Up feature, you will no longer be eligible for any future GMWB Step-Ups and the feature cannot be added back to this rider.

At the end of each calendar quarter (or on the next valuation date, if the calendar quarter ends on a non-valuation date), the rider charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a calendar quarter, the rider charge is prorated according to the number of days this rider is in effect during the quarter. Upon termination of this rider, the rider charge will be based on the number of days this rider is in effect during the calendar quarter.

We reserve the right to increase the rider charge up to a maximum annual charge of 1.00% (0.25% quarterly) of the average quarterly Investment Back withdrawal benefit base.

The rider charge is intended to reimburse us for the cost of the protection provided by this rider.

We use certain defined terms in our description of the riders. For your convenience, we have included definitions of those terms in the GMWB Terms.

GMWB Overview

Withdrawal options. This rider provides the flexibility of both a For Life withdrawal option and an Investment Back withdrawal option. You are not required to choose between these two withdrawal options unless your Contract accumulated value is zero or you reach the maximum annuitization date.

The For Life withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines as well as the risk of outliving your money. The Investment Back withdrawal option helps to protect you against the risk of a decrease in the Contract accumulated value due to market declines and is designed to permit you to recover at least yourpremium payments.

For Life withdrawal benefit payment percentages. This rider has a tiered “Single Life” For Life withdrawal option (based on one covered life) which has withdrawal benefit payment percentages ranging from 3.50% to 6.50% depending on the age at first withdrawal.

Bonus feature. This rider has a Bonus feature (described below) which rewards you for not taking a withdrawal in certain early years of the rider. The GMWB Bonus does not increase your Contract accumulated value.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     150

Step-Up feature. This rider has a Step-Up feature (described below) which can increase your rider withdrawal benefit payments if your Contract accumulated value increases. The Contract accumulated value increases whenever additional premium payments are made, the division values rise with market growth, or credits (premium payment credits or exchange credit) are applied.

This rider provides that the remaining withdrawal benefit bases continue to be eligible for step-up after reducing to zero.

Maximum annual rider charge. This rider has a maximum annual rider charge (1.00% of the Investment Back withdrawal benefit base).

Spousal continuation. This rider makes available only the Investment Back withdrawal option under such circumstances.

Additional death benefit. This rider also allows your beneficiary(ies) to choose a death benefit under the Contract or any death benefit available under the rider.

Rider Restrictions/Limitations

Once elected, the GMWB rider may not be terminated for five contract years following the rider effective date.

There is a charge for the GMWB rider which can increase up to the guaranteed maximum charge for the rider (see SUMMARY OF EXPENSE INFORMATION).

This rider does not restrict or change your right to take — or not take — withdrawals under the Contract. All withdrawals reduce the Contract accumulated value by the amount withdrawn and are subject to the same conditions, limitations, fees, charges and deductions as withdrawals otherwise taken under the provisions of the Contract; for example, withdrawals will be subject to surrender charges if they exceed the free surrender amount (see 2. CHARGES AND DEDUCTIONS). However, any withdrawals may have an impact on the value of your rider’s benefits.

Election of the GMWB rider results in restriction of your Contract investment options to the more limited GMWB investment options (see APPENDIX B). The GMWB investment options reflect a balanced investment objective that is intended to support the rider guarantees. If your investment objective is aggressive growth, the rider investment restrictions may not support your investment objective. We reserve the right to modify the list of available GMWB investment options from time to time, subject to compliance with applicable regulations.

GMWB Terms

We use the following definitions to describe the features of a GMWB rider:

• Excess Withdrawal — the portion of a withdrawal that exceeds the available withdrawal benefit payment for a withdrawal option.

• GMWB Bonus — a bonus credited to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option, provided certain conditions are met.

• GMWB Step-Up — an increase to the withdrawal benefit base and/or remaining withdrawal benefit base for each withdrawal option to an amount equal to your Contract’s accumulated value on the most recent Contract anniversary, provided certain conditions are met.

• Remaining withdrawal benefit base — the amount available for future withdrawal benefit payments under a withdrawal option. The remaining withdrawal benefit base for each withdrawal option is calculated separately.

• Required minimum distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions in effect as of the rider effective date.

• Rider effective date — the date the rider is issued.

• Withdrawal — any partial surrender (including surrender charges, if any) and/or any partial annuitization of your Contract’s accumulated value.

• Withdrawal benefit base — the basis for determining the withdrawal benefit payment available each year under a withdrawal option. The withdrawal benefit base for each withdrawal option is calculated separately.

• Withdrawal benefit payment — the amount that we guarantee you may withdraw each contract year under a withdrawal option.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     151

GMWB Investment Options

While a GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under a GMWB rider (the “GMWB investment options”) reflect a balanced investment objective and if your investment goal is aggressive growth, a GMWB rider may not support your investment objective. With GMWB investment options that reflect a balanced investment objective, there is potentially a reduced likelihood that we will have to make GMWB benefit payments when the Contract value goes to zero, reaches the maximum annuitization date, or if there is a death claim.

The GMWB investment options are shown in APPENDIX B. While the GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under the GMWB rider are intended to support the rider’s guarantees with a balanced investment objective. It is your responsibility to select your GMWB investment option. You may wish to ask your registered representative to assist you in making your selection. We reserve the right to modify the list of available GMWB investment options, subject to compliance with applicable regulations.

Withdrawal Options

For Life Withdrawal Option. This option is intended to help you avoid the risk of out-living your money. You are eligible to take For Life withdrawal benefit payments beginning (i) on the rider effective date if the oldest owner (or the oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or the oldest annuitant, if applicable) attains age 59½. Once eligible, you may withdraw an amount up to the annual For Life withdrawal benefit payment until the earlier of the date of the death of the covered life or the date the For Life withdrawal benefit base reduces to zero.

Investment Back Withdrawal Option. This option is intended to allow a more rapid recovery of yourpremium payments (approximately 14 years). You are eligible to take Investment Back withdrawal benefit payments beginning on the rider effective date. You may withdraw an amount up to the annual Investment Back withdrawal benefit payment until the earlier of the date of your death (annuitant’s death if the owner is not a natural person) or the date the Investment Back remaining withdrawal benefit base equals zero.

Withdrawal Benefit Base

Each withdrawal option has its own withdrawal benefit base, which is used to calculate the annual withdrawal benefit payment for that option. We calculate the withdrawal benefit base for the Investment Back and the For Life withdrawal options separately on

• the rider effective date and

• each Contract anniversary.

The initial withdrawal benefit base for both withdrawal options is equal to the initial premium payment.

On each Contract anniversary, the withdrawal benefit base for each withdrawal option is reset to the greater of 1 or 2, where:

1. is the result of (a + b + c - d), where:

a = prior year withdrawal benefit base (or initial withdrawal benefit base if first Contract anniversary);

b = additional premiums since the previous Contract anniversary (dollar-for-dollar);

c = any GMWB Bonus credited since the previous Contract anniversary;

d = any excess withdrawals taken since the previous Contract anniversary*.

2. is the accumulated value on the Contract anniversary.

* NOTE: The reduction for an excess withdrawal will be greater than dollar-for-dollar if the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal. See Excess Withdrawals later in this section for information about the negative effect of excess withdrawals.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     152

Remaining Withdrawal Benefit Base

Each withdrawal option has its own remaining withdrawal benefit base. The remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments under each withdrawal option. We calculate the For Life and the Investment Back remaining withdrawal benefit bases separately on

• the rider effective date,

• when a premium payment is made,

• when any applicable GMWB Bonus is credited, and

• when a withdrawal is taken.

The initial remaining withdrawal benefit base for both withdrawal options is equal to the initial premium payment (and likewise equal to the initial withdrawal benefit base) on the rider effective date.

After the rider effective date, the remaining withdrawal benefit base for each withdrawal option will be

• increased dollar-for-dollar by each additional premium payment made and each GMWB Bonus credited;

• decreased dollar-for-dollar for each withdrawal benefit payment taken; and

• decreased to reflect any excess withdrawals taken since the previous Contract anniversary (the reduction will be greater than dollar-for-dollar, as shown below, if the Contract accumulated value is less than the remaining withdrawal benefit base at the time of the excess withdrawal). See Excess Withdrawals, below, for information about the negative effect that excess withdrawals have on the riders.

Withdrawal Benefit Payments

The Investment Back withdrawal benefit payment is equal to 7% of the Investment Back withdrawal benefit base. The Investment Back withdrawal benefit payments are available as of the rider effective date.

For Life withdrawal benefit payments are available (i) on the rider effective date if the oldest owner (or oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or oldest annuitant, if applicable) attains age 59½. The percentage to determine the annual For Life withdrawal benefit payment ranges from 3.50% to 6.50% of the For Life withdrawal benefit base.

Under this rider, For Life withdrawal benefit payments are “Single Life”. “Single Life” For Life withdrawal benefit payments are based on one covered life. The covered life is the

a. owner if there is only one owner;

b. annuitant if the owner is not a natural person;

c. youngest joint owner if there are joint owners; or

d. youngest annuitant if there are joint annuitants and the owner is not a natural person.

“Single Life” For Life withdrawal benefit payments may be taken until the earlier of the date of the death of the first owner to die (first annuitant, if applicable) or the date the For Life withdrawal benefit base reduces to zero.

Calculating the For Life Withdrawal Benefit Payment

The For Life withdrawal benefit payment is an amount equal to a percentage multiplied by the For Life withdrawal benefit base.

The initial For Life withdrawal benefit payment percentage depends on the age of the covered life on the date of the first withdrawal:

Age of Covered Life at First Withdrawal	For Life Withdrawal Benefit Payment Percentage
45-49	3.50%
50-54	4.00%
55-59	4.50%
60-69	5.00%
70-74	5.50%
75-79	6.00%
80+	6.50%

Appendix F – GMWB 2-SL (No Longer Available for Sale)     153

Covered Life Change

Any ownership change (annuitant change if the owner is not a natural person) before the annuitization date will result in termination of this rider, except for a change in owner due to a spousal continuation of the rider.

Effect of Withdrawals

The rider does not require you to take an available withdrawal benefit payment. If you want to take advantage of the rider’s GMWB Bonus features, withdrawals cannot be taken during the period the GMWB Bonus is available.

If you elect not to take an available withdrawal benefit payment, that amount will not be carried forward to the next contract year.

Each time you take a withdrawal, it is reflected immediately in your Contract accumulated value and in the remaining withdrawal benefit base for each withdrawal option.

If you take excess withdrawals, the withdrawal benefit base for each withdrawal option will be reduced on the next Contract anniversary. See Excess Withdrawals for information about the negative effect of excess withdrawals.

To help you better understand the various features of the GMWB 2-SL rider and to demonstrate how premium payments made and withdrawals taken from the Contract affect the values and benefits under the rider, we have provided several examples at the end of this appendix.

Excess Withdrawals

Any withdrawals that exceed the available withdrawal benefit payments for either withdrawal option are excess withdrawals.

Excess withdrawals reduce withdrawal benefit payments, the withdrawal benefit bases, and the remaining withdrawal benefit bases for the two withdrawal options. The reductions can be greater than dollar-for-dollar when the Contract accumulated value is less than the applicable rider withdrawal benefit base at the time of the excess withdrawal, as shown below.

Effect on withdrawal benefit base. Excess withdrawals will reduce each of the withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the withdrawal benefit base prior to the adjustment for the excess withdrawal.

Effect on remaining withdrawal benefit base. Excess withdrawals will reduce each of the remaining withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the remaining withdrawal benefit base prior to the adjustment for the excess withdrawal.

NOTE: All withdrawals taken prior to the date that the oldest owner (oldest annuitant, if applicable) has met the For Life age eligibility requirement are excess withdrawals.

NOTE: For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the required minimum distribution for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals. See Required Minimum Distribution (RMD) Program for GMWB Riders.

Required Minimum Distribution (RMD) Program for GMWB Riders

Tax-qualified contracts are subject to certain federal tax rules requiring that RMD be taken on a calendar year basis (i.e., compared to a contract year basis), usually beginning after age 72.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     154

If you are eligible for and enroll in our RMD Program for GMWB Riders, as discussed below, a withdrawal taken to satisfy RMD for the Contract (an “RMD amount”) that exceeds a withdrawal benefit payment for that contract year will not be deemed an excess withdrawal.

RMD Program. Eligibility in the RMD Program for GMWB Riders is determined by satisfaction of the following requirements:

• your Contract may not have the Enhanced Death Benefit Rider;

• the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of the Internal Revenue Code is based only on this Contract (the “RMD amount”); and

• you have elected scheduled withdrawal payments.

NOTE: Although enrollment in the RMD Program for GMWB Riders does not prevent you from taking an unscheduled withdrawal, an unscheduled withdrawal will cause you to lose the RMD Program protections for the remainder of the contract year. This means that any withdrawals (scheduled or unscheduled) during the remainder of the contract year that exceed applicable withdrawal benefit payments will be treated as excess withdrawals, even if the purpose is to take the RMD amount. You will automatically be re-enrolled in the RMD Program for GMWB Riders on your next Contract anniversary.

We reserve the right to modify or eliminate the RMD Program for GMWB Riders; for example, if there is a change to the Internal Revenue Code or Internal Revenue Service rules or interpretations relating to RMD, including the issuance of relevant IRS guidance. We will send you at least 30 days advance notice of any change in or elimination of the RMD Program for GMWB Riders. Any modifications or elimination of the RMD Program for GMWB Riders will take effect after notice. If we exercise our right to modify or eliminate the RMD Program for GMWB Riders, then any withdrawal in excess of a withdrawal benefit payment after the effective date of the program’s modification or elimination will be deemed an excess withdrawal.

For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the required minimum distribution for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals.

You may obtain more information regarding our RMD Program for GMWB Riders by contacting your registered representative or by calling us at 1-800-852-4450.

GMWB Bonus

Under the GMWB Bonus, on each of the first three Contract anniversaries following the rider effective date, we will credit a bonus (“GMWB Bonus”) to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option, provided you have not taken any withdrawals since the rider effective date.

The GMWB Bonus is equal to the total of all premium payments made prior to the applicable Contract anniversary multiplied by the applicable percentage shown in the chart below. If the contract date and the rider effective date are different, the GMWB Bonus is equal to the Contract accumulated value on the rider effective date plus premium payments made between the rider effective date and the Contract anniversary, multiplied by the applicable percentage shown in the chart below.

Contract Anniversary following the rider effective date	GMWB Bonus Percentage
1	7.00%
2	6.00%
3	5.00%

The GMWB Bonus is no longer available after the earlier of

• The third Contract anniversary following the rider effective date; or

• The date you take a withdrawal following the rider effective date.

NOTE: The GMWB Bonus is used only for the purposes of calculating the withdrawal benefit bases and the remaining withdrawal benefit bases for each withdrawal option. The GMWB Bonus is not added to your Contract accumulated value.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     155

GMWB Step-Up

The GMWB Step-Up is automatic and applies annually. Under this rider, unless an owner opts out of the automatic GMWB Step-Up, the rider charge will increase if our then current rider charge is higher than when the rider was purchased. The rider charge will never be greater than the maximum GMWB 2-SL rider charge. See SUMMARY OF EXPENSE INFORMATION section.

We determine eligibility for a GMWB Step-Up of the withdrawal benefit base and remaining withdrawal benefit base for each withdrawal option separately. If you satisfy the eligibility requirements on a Contract anniversary and your Contract accumulated value is greater than the applicable withdrawal benefit base, we will Step-Up the applicable withdrawal benefit base and remaining withdrawal benefit base to your Contract accumulated value on that Contract anniversary. We will not reduce your withdrawal benefit base or remaining withdrawal benefit base if your Contract accumulated value on a Contract anniversary is less than a withdrawal benefit base.

If you are eligible for a GMWB Step-Up of a withdrawal benefit base or remaining withdrawal benefit base, you will be charged the then current rider charge. You may choose to opt out of the GMWB Step-Up feature if the charge for your rider will increase. We will send you advance notice if the charge for your rider will increase in order to give you the opportunity to opt out of the GMWB Step-Up feature. Once you opt out, you will no longer be eligible for future GMWB Step-Ups.

The GMWB Step-Up operates as follows.

On each Contract anniversary following the rider effective date, you are eligible for a GMWB Step-Up of a withdrawal benefit base and remaining withdrawal benefit base if you satisfy all of the following requirements:

1. the Contract anniversary occurs before the later of

a. the Contract anniversary following the date the oldest owner (oldest annuitant if the owner is not a natural person) attains age 80; or

b. ten years after the rider effective date;

2. you have not declined any increases in the rider charge; and

3. you have not fully annuitized the Contract.

Under this rider, a surviving spouse who continues the Contract with this rider attached may elect a special GMWB Step-Up at the time of making the spousal continuation. The special GMWB Step-Up is only available if you did not previously opt out of the GMWB Step-Up feature. If your spouse elects the special GMWB Step-Up, we will step-up the applicable remaining withdrawal benefit base and withdrawal benefit base to your Contract accumulated value as of the date of the spousal continuation election is received by us in good order. Following the special GMWB Step-Up, the GMWB Step-Up feature will continue according to the terms of this rider and your surviving spouse will be charged the then current rider charge. If your surviving spouse continues your Contract with this rider attached and does not elect the special GMWB Step-Up, the GMWB Step-Up feature will continue according to the terms of this rider.

Effect of Reaching the Maximum Annuitization Date Under the Rider

On or before the maximum annuitization date, you must elect one of the Contract or GMWB rider payment options described below.

1. Contract payment options:

• Payments resulting from applying the Contract accumulated value to an annuity benefit payment option.

• Payment of the Contract accumulated value as a single payment.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     156

2. GMWB rider payment options:

• You may elect the Investment Back withdrawal option and receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment, until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death (death of the first annuitant to die if the owner is not a natural person), we will continue payments as described in GMWB 2-SL Upon Death.

• You may elect the For Life withdrawal option and receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment, until the later of

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of your death (the death of the first annuitant to die if the owner is not a natural person).

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 2-SL Upon Death.

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of rider withdrawal benefit payments.

We will send you written notice at least 30 days prior to the maximum annuitization date and ask you to select one of the available payment options listed above. If we have not received your election as of the maximum annuitization date, we will automatically apply your Contract accumulated value to an annuity benefit payment option:

• for Contracts with one annuitant – Life Income with payments guaranteed for a period of 10 years.

• for Contracts with joint annuitants – Joint and Full Survivor Income with payments guaranteed for a period of 10 years.

Effect of the Contract Accumulated Value Reaching Zero under the Rider

We will pay the withdrawal benefit payments under the withdrawal option you have elected as follows:

• If you elect the Investment Back withdrawal option, you will receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 2-SL Upon Death.

• If you elect the For Life withdrawal option, you will receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment until the later of

•the date the For Life remaining withdrawal benefit base is zero; or

•the date of your death (annuitant’s death if the owner is not a natural person).

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described below.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     157

GMWB 2-SL Upon Death

When the Contract Accumulated Value is Greater than Zero. The following table illustrates the various situations and the resulting outcome if your Contract accumulated value is greater than zero at your death.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The primary beneficiary(ies) must elect one of the following: a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only your beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may a. continue the Contract with or without this rider as set forth below in Spousal Continuation of the GMWB 2-SLRider; or b. elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** All other primary beneficiaries must elect one of the options listed above in b. Unless your spouse elects to continue the Contract with this rider, only your spouse’s and beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

If you die and...	And...	Then...
You are a joint owner	The surviving joint owner is not your spouse	Your surviving owner must elect one of the following: a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only the surviving owner’s right to the above selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may a. continue the Contract with or without this rider as set forth below in Spousal Continuation of the GMWB 2-SLRider; or b. elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** Unless the surviving spouse owner elects to continue the Contract with this rider, upon your death, only your spouse’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

* Please see 8. Death Benefit for an explanation of the Contract’s death benefit and payment options available for the Contract’s death benefit.

** We will make payments in an amount and frequency acceptable to us. If a surviving owner or beneficiary chooses a periodic payment, it must be at least $100 per payment until the Investment Back remaining withdrawal benefit base is zero.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     158

If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receive the death benefit under the Contract. If a beneficiary dies before the annuitant, on the annuitant’s death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. If no beneficiary(ies) survive the annuitant, the death benefit is paid to the owner. Upon the annuitant’s death, only the beneficiary(ies) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

When the Contract Accumulated Value is Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is zero at your death but the rider still has value.

If you die and…	And…	Then…
You are the sole owner	You elected the For Life withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the Investment Back withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the For Life withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to the beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the Investment Back withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to the beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.

* Please see Effect of the Contract Accumulated Value Reaching Zerounder the Rider , above, for more details regarding election of the For Life withdrawal option or the Investment Back withdrawal option.

If...	And...	Then...
The annuitant dies	The owner is not a natural person The owner elected the For Life Withdrawal option* The owner elected the Investment Back withdrawal option*	The beneficiary(ies) receive the death benefit under the Contract We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the For Life remaining withdrawal benefit base reduces to zero We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the Investment Back remaining withdrawal benefit base reduces to zero.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     159

Termination and Reinstatement of the Rider

You may not terminate this rider prior to the 5th Contract anniversary following the rider effective date.

At any point in time, we will terminate this rider upon the earliest to occur of

• the date you send us notice to terminate the rider (after the 5th Contract anniversary following the rider effective date). This will terminate the rider, not the Contract.

• the date you fully annuitize, fully surrender or otherwise terminate the Contract.

• the date the Investment Back remaining withdrawal benefit base and the For Life withdrawal benefit base are both zero.

• the date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except a change in owner due to a spousal continuation of the rider as described in Spousal Continuation of the GMWB 2-SL Rider.

• the date your surviving spouse elects to continue the Contract without this rider.

If this rider terminates for any reason other than full surrender of the Contract, this rider may not be reinstated.

If you surrender the Contract with this rider attached and the Contract is later reinstated, this rider also must be reinstated. At the time this rider is reinstated, we will deduct rider charges scheduled during the period of termination and make any other adjustments necessary to reflect any changes in the amount reinstated and the Contract accumulated value as of the date of termination.

Spousal Continuation of the GMWB 2-SL Rider

If you die while this rider is in effect and if your surviving spouse elects to continue the Contract in accordance with its terms, the surviving spouse may also elect to continue this rider if

1. the Contract accumulated value is greater than zero;

2. the Contract and this rider have not been previously continued; and

3. your Spouse is either

a. your primary beneficiary, if you were the sole owner; or

b. the surviving joint owner, if there were joint owners.

If your spouse elects to continue the Contract with this rider, your spouse may take withdrawals under the Investment Back withdrawal option until the Investment Back remaining withdrawal benefit base reduces to zero. The For Life withdrawal option terminates upon your death. All other provisions of this rider will continue as in effect on the date of your death.

If your spouse elects to continue the Contract without this rider, this rider and all rights, benefits and charges under this rider will terminate and cannot be reinstated.

NOTE: Although spousal continuation may be available under federal tax laws for a subsequent spouse, this rider may be continued one time only.

Effect of Divorce on the Rider

The following table illustrates divorce situations and the resulting outcomes.

If…	And…	Then…
You are the sole owner of the contract	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. You will retain all rights and benefits of the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     160

If…	And…	Then…
You are the sole owner of the contract	You direct us to change ownership of the Contract to your former spouse to satisfy a court order	The GMWB rider will terminate. Your former spouse will become the new owner of the Contract and will retain all rights and benefits of the Contract.
Contract is jointly owned	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. If you direct us to remove one of the joint owners, the spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.
Contract is jointly owned	You direct us to remove one of the joint owners to satisfy a court order	The spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     161

GMWB 2- SL Rider Summary

Name of Rider	GMWB 2 – SL (Single Life)
Marketing Name	Investment Protector Plus 2 Rider
Rider Issue Age	45 – 80
Rider Charge	GMWB 2 - SL Rider Charges (as a percentage of average quarterly Investment Back withdrawal benefit base) • Maximum annual charge is 1.00%. • Current annual charge if you opt out of future GMWB Step-Ups after the Contract's 2010 anniversary is 0.75%. • Current annual charge is you do not opt out of future GMWB Step-Ups after the Contract's 2010 anniversary is 0.95%.
Guaranteed Minimum Withdrawal Benefits	•Investment Back •For Life
Annual Withdrawal Limits	•Investment Back — 7% of the Investment Back withdrawal benefit base. •For Life — tiered percentages based on age at first withdrawal, beginning at 3.50% and capping at a maximum of 6.50% of the For Life withdrawal benefit base
For Life Withdrawal Benefit Payments	•Single Life only •Available the Contract anniversary following the date the oldest owner turns 59½ — all withdrawals prior to that Contract anniversary are excess withdrawals under the For Life withdrawal option
Termination	•You may terminate this rider anytime after the 5th Contract anniversary following the rider effective date
GMWB Step-Up	•Automatic annual GMWB Step-Up available until the later of (a) the Contract anniversary prior to age 80 or (b) 10 years after the rider effective date. •There are no restrictions on Step-Ups of the remaining withdrawal benefit base after reducing to zero.
GMWB Bonus	•If no withdrawals are taken, a GMWB Bonus is applied to the benefit bases on each Contract anniversary as shown below. •Year 1 — 7.00% of premium payments •Year 2 — 6.00% of premium payments •Year 3 — 5.00% of premium payments
Investment Restrictions	•You must select one of the GMWB investment options; there are no additional restrictions on allocations to the Fixed Account or DCA Plus accounts.
Spousal Continuation	•At the death of the first owner to die, a spouse who is a joint owner or primary beneficiary may continue the Contract with or without this rider. •Only the Investment Back withdrawal option continues; the For Life withdrawal option terminates.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     162

EXAMPLES

These examples have been provided to assist you in understanding the various features of the GMWB 2-SL Rider and to demonstrate how premium payments received and withdrawals taken from the Contract affect the values and benefits under the GMWB 2-SL Rider. These examples are based on certain hypothetical assumptions and are for illustrative purposes only. These examples are not intended to serve as projections of future investment returns.

NOTE: For the purpose of the following examples, a partial annuitization has the same effect as a partial surrender and both are referred to as a withdrawal in the following examples.

Examples Without Excess Withdrawals (Examples 1-3)

The examples without excess withdrawals assume the following:

• the client is age 62 and the client’s spouse is age 60 on the rider effective date.

• initial premium payment = $100,000.

• the withdrawal benefit bases prior to partial surrender = $100,000.

• the remaining withdrawal benefit bases prior to partial surrender = $100,000.

• Investment Back (7%) withdrawal benefit payment = $7,000.

• For Life (5%) withdrawal benefit payment = $5,000, if withdrawals start prior to the client attaining age 70.

Example 1

In contract year one, no withdrawals are taken.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is $100,000 x 0.07 = $7,000.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

• the new Investment Back withdrawal benefit base is $100,000 + 7,000 = $107,000;

• the new Investment Back remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

• the new Investment Back withdrawal benefit payment is $107,000 x 0.07 = $7,490.

• For Life:

•the new For Life withdrawal benefit base is $100,000 + 7,000 = $107,000;

•the new For Life remaining withdrawal benefit base is $100,000 + 7,000 = $107,000; and

•the new For Life withdrawal benefit payment is $107,000 x 0.05 = $5,350.

Example 2

In contract year one:

• no withdrawals are taken.

• the client makes a premium payment of $50,000.

On the first Contract anniversary:

• a 7% GMWB bonus is credited to the withdrawal benefit base. The credit is ($100,000 + $50,000) x 0.07 = $10,500.

• there is no GMWB Step-Up because the withdrawal benefit bases after the bonus is credited are larger than the Contract’s accumulated value.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500;

• the new Investment Back remaining withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500; and

•the new Investment Back withdrawal benefit payment is $160,500 x 0.07 = $11,235.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500;

• the new For Life remaining withdrawal benefit base is $100,000 + $50,000 + $10,500 = $160,500; and

• the new For Life withdrawal benefit payment is $160,500 x 0.05 = $8,025.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     163

Example 3

In each of the first two contract years, the client takes a withdrawal of $5,000. Assume there is no GMWB Step-Up on the first Contract anniversary. On the 2nd Contract anniversary, the client will receive GMWB Step-Up if the Contract’s accumulated value is greater than the applicable withdrawal benefit base.

If the accumulated value on the second contract anniversary is:	$95,000	$110,000
Investment Back
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$100,000 x 0.07 = $7,000
Remaining Withdrawal Benefit Base	$90,000	$90,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$110,000 x 0.07 = $7,700
Remaining Withdrawal Benefit Base	$90,000	$110,000
For Life
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$100,000 x 0.05 = $5,000
Remaining withdrawal Benefit Base	$90,000	$90,000
After step-up
Withdrawal Benefit Base	$100,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$110,000 x 0.05 = $5,500
Remaining Withdrawal Benefit Base	$95,000	$110,000

Examples With Excess Withdrawals (Examples 4-5)

The excess withdrawal examples assume the following:

• the client is age 62 and elected For Life withdrawal benefit payments at the first withdrawal and therefore, locks-in the For Life withdrawal benefit payment percentage at 5%.

• the initial premium payment is $100,000

• the withdrawal benefit bases prior to partial surrender = $100,000

• the remaining withdrawal benefit bases prior to partial surrender = $100,000

• Investment Back (7%) withdrawal benefit payment = $7,000

• For Life (5%) withdrawal benefit payment = $5,000

• Withdrawal taken = $8,000

•excess amount under the Investment Back withdrawal option is $1,000; and

•excess amount under the For Life withdrawal option is $3,000

Appendix F – GMWB 2-SL (No Longer Available for Sale)     164

Example 4

In this example, assume the accumulated value prior to the withdrawal is $90,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,204.82. The new Investment Back withdrawal benefit base is $100,000 - $1,204.82 = $98,795.18.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $1,204.82 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment remaining prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

For Life

The amount of the adjustment* is $3,529.41. The new For Life withdrawal benefit base is $100,000 - $3,529.41 = $96,470.59.

*The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $3,529.41 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

2 = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     165

Investment Back

The amount of the adjustment* is $8,120.48 (the amount of the Investment Back withdrawal benefit plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,120.48 = $91,879.52.

*The amount of the adjustment is (a plus b) where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,120.48 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $1,120.48 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,352.94 (the amount of the For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,352.94 = $91,647.06.

* The amount of the adjustment is (a plus b) where:

a = $5,000 (the actual amount withdrawn that does not exceed the For Life withdrawal benefit payment); and

b = $3,352.94 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $3,352.94 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the For Life withdrawal benefit payment remaining prior to the withdrawal ($3,000);

y = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $98,795.18 x 0.07 = $6,915.66.

For Life

The new For Life withdrawal benefit payment is $96,470.59 x 0.05 = $4,823.53.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     166

Example 5

In this example, assume the accumulated value prior to the withdrawal is $110,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,000 (the amount of the excess withdrawal). The new Investment Back withdrawal benefit base is $100,000 - $1,000 = $99,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $970.87 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000)

For Life

The amount of the adjustment* is $3,000 (the amount of the excess withdrawal). The new For Life withdrawal benefit base is $100,000 - $3,000 = $97,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $2,857.14 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

2 = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Appendix F – GMWB 2-SL (No Longer Available for Sale)     167

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Investment Back

The amount of the adjustment* is $8,000 (the amount of the Investment Back withdrawal benefit payment plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

*    The amount of the adjustment is a plus b where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $902.91 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,000 (the amount of the For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

*    The amount of the adjustment is a plus b where:

a = $5,000 (the actual amount withdrawn that does not exceed the For Life withdrawal benefit payment); and

b = $3,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $2,714.28 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

y = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $99,000 x 0.07 = $6,930.

For Life

The new For Life withdrawal benefit payment is $97,000 x 0.05 = $4,850.

Appendix F – GMWB 2-SL (No Longer Available for Sale)     168

APPENDIX G — GMWB 1 (NO LONGER AVAILABLE FOR SALE)

GMWB 1 Rider -- (Investment Protector Plus)

Appendix G is only applicable to Contract owners who purchased the GMWB 1 rider while it was available. The GMWB 1 Rider was available from March 1, 2005 until January 3, 2010.

For GMWB 1 rider applications signed on or after February 16, 2009, the current annual charge for the rider is 0.80% of the average quarterly Investment Back remaining withdrawal benefit base. The charge is taken at the end of the calendar quarter at 0.20%, based on the average quarterly Investment Back remaining withdrawal benefit base during the calendar quarter. The average quarterly Investment Back remaining withdrawal benefit base is equal to the Investment Back remaining withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back remaining withdrawal benefit base at the end of the calendar quarter and the sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

For GMWB 1 rider applications signed before February 16, 2009, the current annual charge for the rider is 0.60% of the average quarterly Investment Back remaining withdrawal benefit base. The charge is taken at the end of the calendar quarter at 0.15%, based on the average quarterly Investment Back remaining withdrawal benefit base during the calendar quarter. The average quarterly Investment Back remaining withdrawal benefit base is equal to the Investment Back remaining withdrawal benefit base at the beginning of the calendar quarter plus the Investment Back remaining withdrawal benefit base at the end of the calendar quarter and the sum is divided by two. There may be times when the sum of the four quarterly fee amounts is different than the fee amount if we calculated it annually. For example, if your withdrawal benefit base is changed on your Contract anniversary, the fee for that calendar quarter will vary from the other quarters.

We reserve the right to increase the rider charge up to a maximum annual charge of 0.85% (0.2125% quarterly) of the average quarterly Investment Back remaining withdrawal benefit base. If you elect a GMWB Step-Up, you will be charged the then current rider charge.

At the end of each calendar quarter (or on the next valuation date, if the calendar quarter ends on a non-valuation date), the rider charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a calendar quarter, the rider charge is prorated according to the number of days this rider is in effect during the calendar quarter. Upon termination of this rider, the rider charge will be based on the number of days this rider is in effect during the calendar quarter.

The rider charge is intended to reimburse us for the cost of the protection provided by this rider.

Eligibility requirements for the GMWB 1 Rider are that the oldest owner (or oldest annuitant if the owner is not a natural person) must be younger than age 81.

Rider Restrictions/Limitations

Once elected, the GMWB rider may not be terminated for five contract years following the rider effective date.

There is a charge for the GMWB rider which can increase up to the guaranteed maximum charge for the rider (see SUMMARY OF EXPENSE INFORMATION).

This rider does not restrict or change your right to take — or not take — withdrawals under the Contract. All withdrawals reduce the Contract accumulated value by the amount withdrawn and are subject to the same conditions, limitations, fees, charges and deductions as withdrawals otherwise taken under the provisions of the Contract; for example, withdrawals will be subject to surrender charges if they exceed the free surrender amount (see 2. CHARGES AND DEDUCTIONS). However, any withdrawals may have an impact on the value of your rider’s benefits.

Appendix G – GMWB 1 (No Longer Available for Sale)         169

Election of the GMWB rider results in restriction of your Contract investment options to the more limited GMWB investment options (see APPENDIX B). The GMWB investment options reflect a balanced investment objective that is intended to support the rider guarantees. If your investment objective is aggressive growth, the rider investment restrictions may not support your investment objective. We reserve the right to modify the list of available GMWB investment options from time to time, subject to compliance with applicable regulations.

GMWB 1 Terms

We use the following definitions to describe the features of this rider:

• Excess Withdrawal — the portion of a withdrawal that exceeds the available withdrawal benefit payment for a withdrawal option.

• GMWB Bonus — a bonus credited to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option, provided certain conditions are met.

• GMWB Step-Up — an increase to the withdrawal benefit base and/or remaining withdrawal benefit base for each withdrawal option to an amount equal to your Contract’s accumulated value on the most recent Contract anniversary, provided certain conditions are met.

• Remaining withdrawal benefit base — the amount available for future withdrawal benefit payments under a withdrawal option. The remaining withdrawal benefit base for each withdrawal option is calculated separately.

• Required minimum distribution (“RMD”) amount — the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of Section 401(a)(9) of the Internal Revenue Code of 1986, as amended, and related Code provisions in effect as of the rider effective date.

• Rider effective date — the date the rider is issued.

• Withdrawal — any partial surrender (including surrender charges, if any) and/or any partial annuitization of your Contract’s accumulated value.

• Withdrawal benefit base — the basis for determining the withdrawal benefit payment available each year under a withdrawal option. The withdrawal benefit base for each withdrawal option is calculated separately.

• Withdrawal benefit payment — the amount that we guarantee you may withdraw each contract year under a withdrawal option.

GMWB Investment Options

While a GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under a GMWB rider (the “GMWB investment options”) reflect a balanced investment objective and if your investment goal is aggressive growth, a GMWB rider may not support your investment objective. With GMWB investment options that reflect a balanced investment objective, there is potentially a reduced likelihood that we will have to make GMWB benefit payments when the Contract value goes to zero, reaches the maximum annuitization date, or if there is a death claim.

The GMWB investment options are shown in APPENDIX B. While the GMWB rider is in effect, the investment optionsyou may select are restricted. The limited investment options available under the GMWB rider are intended to support the rider’s guarantees with a balanced investment objective. It is your responsibility to select your GMWB investment option. You may wish to ask your financial advisor to assist you in making your selection. We reserve the right to modify the list of available GMWB investment options, subject to compliance with applicable regulations.

Withdrawal Options

For Life Withdrawal Option. This option is intended to help you avoid the risk of out-living your money. You are eligible to take For Life withdrawal benefit payments beginning (i) on the rider effective date if the oldest owner (or the oldest annuitant, if the Contract owner is not a natural person) is at least age 59½ or (ii) on the Contract anniversary following the date that the oldest owner (or the oldest annuitant, if applicable) attains age 59½. Once eligible, you may withdraw an amount up to the annual For Life withdrawal benefit payment until the earlier of the date of your death (annuitant’s death, where applicable) or the date the For Life withdrawal benefit base reduces to zero.

Investment Back Withdrawal Option. This option is intended to allow a more rapid recovery of yourpremium payments (approximately 14 years). You are eligible to take Investment Back withdrawal benefit payments beginning on the rider effective date. You may withdraw an amount up to the annual Investment Back withdrawal benefit payment until the earlier of the date of your death (annuitant’s death if the owner is not a natural person) or the date the Investment Back remaining withdrawal benefit base equals zero.

Appendix G – GMWB 1 (No Longer Available for Sale)         170

Withdrawal Benefit Base

Each withdrawal option has its own withdrawal benefit base, which is used to calculate the annual withdrawal benefit payment for that option. We calculate the withdrawal benefit base for the Investment Back and the For Life withdrawal options separately on

• the rider effective date; and

• each Contract anniversary.

The initial withdrawal benefit base for both withdrawal options is equal to the initial premium payment.

On each Contract anniversary, the withdrawal benefit base for each withdrawal option is

• increased dollar-for-dollar by any additional premium payments made since the previous Contract anniversary and any GMWB Bonus credited since the previous Contract anniversary; and

• decreased to reflect any excess withdrawals taken since the previous Contract anniversary (the reduction will be greater than dollar-for-dollar, if the Contract accumulated value is less than the withdrawal benefit base at the time of the excess withdrawal). See Excess Withdrawals, for information about the negative effect that excess withdrawals have on the riders.

Withdrawal Benefit Payments

The For Life withdrawal benefit payment is equal to 5% of the For Life withdrawal benefit base. The Investment Back withdrawal benefit payment is equal to 7% of the Investment Back withdrawal benefit base.

Remaining Withdrawal Benefit Base

Each withdrawal option has its own remaining withdrawal benefit base. The remaining withdrawal benefit base is used to determine the amount available for future withdrawal benefit payments under each withdrawal option. We calculate the For Life and the Investment Back remaining withdrawal benefit bases separately on

• the rider effective date;

• when a premium payment is made;

• when any applicable GMWB Bonus is credited; and

• when a withdrawal is taken.

The initial remaining withdrawal benefit base for both withdrawal options is equal to the initial premium payment (and likewise equal to the initial withdrawal benefit base) on the rider effective date.

After the rider effective date, the remaining withdrawal benefit base for each withdrawal option will be

• increased dollar-for-dollar by each additional premium payment made and each GMWB Bonus credited;

• decreased dollar-for-dollar for each withdrawal benefit payment taken; and

• decreased to reflect any excess withdrawals taken since the previous Contract anniversary (the reduction will be greater than dollar-for-dollar, as shown below, if the Contract accumulated value is less than the remaining withdrawal benefit base at the time of the excess withdrawal). See Excess Withdrawals, for information about the negative effect that excess withdrawals have on the riders.

Effect of Withdrawals

This rider does not require you to take an available withdrawal benefit payment. If you want to take advantage of the rider’s GMWB Bonus feature, withdrawals cannot be taken during the period the GMWB Bonus is available.

If you elect not to take an available withdrawal benefit payment, that amount will not be carried forward to the next contract year.

Each time you take a withdrawal, it is reflected immediately in your Contract accumulated value and in the remaining withdrawal benefit base for each withdrawal option.

If you take excess withdrawals, the withdrawal benefit base for each withdrawal option will be reduced on the next Contract anniversary. See Excess Withdrawals for information about the negative effect of excess withdrawals.

To help you better understand the various features of the GMWB 1 rider and to demonstrate how premium payments made and withdrawals taken from the Contract affect the values and benefits under the rider, we have provided several examples at the end of this appendix.

Appendix G – GMWB 1 (No Longer Available for Sale)         171

Excess Withdrawals

Any withdrawals that exceed the available withdrawal benefit payments for either withdrawal option are excess withdrawals.

Excess withdrawals reduce withdrawal benefit payments, the withdrawal benefit bases, and the remaining withdrawal benefit bases for the two withdrawal options. The reductions can be greater than dollar-for-dollar when the Contract accumulated value is less than the applicable withdrawal benefit base or remaining withdrawal benefit base at the time of the excess withdrawal, as shown below.

Effect on withdrawal benefit base. Excess withdrawals will reduce each of the withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the withdrawal benefit base prior to the adjustment for the excess withdrawal.

Effect on remaining withdrawal benefit base. Excess withdrawals will reduce each of the remaining withdrawal benefit bases in an amount equal to the greater of:

• the excess withdrawal, or

• the result of (a divided by b) multiplied by c, where:

a = the amount withdrawn that exceeds the available withdrawal benefit payment prior to the withdrawal;

b = the Contract accumulated value after the withdrawal benefit payment is deducted, but prior to deducting the amount of the excess withdrawal; and

c = the remaining withdrawal benefit base prior to the adjustment for the excess withdrawal.

NOTE: All withdrawals taken prior to the date that the oldest owner (oldest annuitant, if applicable) has met the For Life age eligibility requirement are excess withdrawals.

NOTE: For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the required minimum distribution for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals. (See Required Minimum Distribution, (RMD) Program for GMWB Riders.)

Required Minimum Distribution (RMD) Program for GMWB Riders

Tax-qualified contracts are subject to certain federal tax rules requiring that RMD be taken on a calendar year basis (i.e., compared to a contract year basis), usually beginning after age 72.

If you are eligible for and enroll in our RMD Program for GMWB Riders, as discussed below, a withdrawal taken to satisfy RMD for the Contract (an “RMD amount”) that exceeds a withdrawal benefit payment for that contract year will not be deemed an excess withdrawal.

RMD Program. Eligibility in the RMD Program for GMWB Riders is determined by satisfaction of the following requirements:

• your Contract may not have the Enhanced Death Benefit Rider;

• the amount required to be distributed each calendar year for purposes of satisfying the RMD rules of the Internal Revenue Code is based only on this Contract (the “RMD amount”); and

• you have elected scheduled withdrawal payments.

NOTE: Although enrollment in the RMD Program for GMWB Riders does not prevent you from taking an unscheduled withdrawal, an unscheduled withdrawal will cause you to lose the RMD Program protections for the remainder of the contract year. This means that any withdrawals (scheduled or unscheduled) during the remainder of the contract year that exceed applicable withdrawal benefit payments will be treated as excess withdrawals, even if the purpose is to take the RMD amount. You will automatically be re-enrolled in the RMD Program for GMWB Riders on your next Contract anniversary.

Appendix G – GMWB 1 (No Longer Available for Sale)         172

We reserve the right to modify or eliminate the RMD Program for GMWB Riders; for example, if there is a change to the Internal Revenue Code or Internal Revenue Service rules or interpretations relating to RMD, including the issuance of relevant IRS guidance. We will send you at least 30 days advance notice of any change in or elimination of the RMD Program for GMWB Riders. Any modifications or elimination of the RMD Program for GMWB Riders will take effect after notice. If we exercise our right to modify or eliminate the RMD Program for GMWB Riders, then any withdrawal in excess of a withdrawal benefit payment after the effective date of the program’s modification or elimination will be deemed an excess withdrawal.

For riders issued prior to March 25, 2008, on qualified contracts, withdrawals taken prior to November 22, 2008, to satisfy the required minimum distribution for a Contract that exceed the applicable withdrawal benefit payment, will be deemed excess withdrawals.

You may obtain more information regarding our RMD Program for GMWB Riders by contacting your registered representative or by calling us at 1-800-852-4450.

GMWB Bonus

On each of the first five Contract anniversaries following the rider effective date, we will credit a bonus of 5% of premium payments as of the Contract anniversary (“GMWB Bonus”) to the withdrawal benefit base and the remaining withdrawal benefit base for each withdrawal option provided that you have not taken any withdrawals since the rider effective date.

The GMWB Bonus is no longer available after the earlier of

• the fifth Contract anniversary following the rider effective date; or

• the date you take a withdrawal following the rider effective date.

NOTE: The GMWB Bonus is used only for purposes of calculating the withdrawal benefit bases and the remaining withdrawal benefit bases. The GMWB Bonus is not added to your Contract accumulated value.

GMWB Step-Up

Beginning with the fifth Contract anniversary after the rider effective date, if your Contract accumulated value is greater than the Investment Back remaining withdrawal benefit base, you may elect to increase (“Step-Up”) the withdrawal benefit bases and remaining withdrawal benefit bases. The GMWB Step-Up resets the withdrawal benefit base and increases the remaining withdrawal benefit base for both the Investment Back and For Life withdrawal options to your Contract accumulated value on the most recent Contract anniversary.

To elect the GMWB Step-Up, you must notify us within 30 days after your fifth Contract anniversary following the rider effective date. If you do not elect to Step-Up at that time, you are eligible to take a GMWB Step-up election within the 30-day period following any subsequent Contract anniversary, based on the Contract accumulated value on that Contract anniversary. Once a GMWB Step-Up has occurred, you must wait five contract years to elect another Step-Up.

By electing a GMWB Step-Up, you agree to accept the then current rider charge. If you do not elect a GMWB Step-Up, the charge for this rider will not change. By electing a GMWB Step-Up you agree to select from the then current GMWB investment options.

If your surviving spouse continues your Contract with this rider attached (see Spousal Continuation of the GMWB 1 Rider), your surviving spouse may elect a special GMWB Step-Up at the time of making the spousal election. The special GMWB Step-Up and then current rider charge will be applied on the next Contract anniversary and a new five-year Step-Up period will begin. If your surviving spouse does not elect the special GMWB Step-Up, the Step-Up feature will continue according to the terms of the rider, and the charge for the rider will not change.

If your rider has an effective date on or after June 15, 2008, it will provide that if your Investment Back remaining withdrawal benefit base reduces to zero, your rider is no longer eligible for any future Step-Ups of the remaining withdrawal benefit bases under either withdrawal option, even if you make subsequent premium payments.

Effect of the Contract Accumulated Value Reaching Zero Under the Rider

In the event that the Contract accumulated value reduces to zero, you must elect either

• the Investment Back withdrawal option (only available if the Investment Back remaining withdrawal benefit base is greater than zero); or

• the For Life withdrawal option (only available if the For Life withdrawal benefit base is greater than zero).

Appendix G – GMWB 1 (No Longer Available for Sale)         173

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster pay out of withdrawal benefit payments.

We will pay the withdrawal benefit payments under the withdrawal option you have elected as follows:

• If you elect the Investment Back withdrawal option, you will receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment until the Investment Back remaining withdrawal benefit base is zero.

If there is any Investment Back remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 1 Upon Death.

• If you elect the For Life withdrawal option, you will receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment, until the later of

•the date the For Life remaining withdrawal benefit base is zero; or

•the date of your death (annuitant’s death if the owner is not a natural person).

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 1 Upon Death.

NOTE: In the event that the Contract accumulated value reduces to zero, the withdrawal benefit payments elected above will continue, but all other rights and benefits under this rider and the Contract (including the death benefits) will terminate, and no additional premium payments will be accepted.

We will send you prior written notice whenever reasonably feasible if your Contract accumulated value is approaching zero.

Effect of Reaching the Maximum Annuitization Date Under the Rider

On or before the maximum annuitization date, you must elect one of the Contract or GMWB rider payment options described below.

1. Contract payment options:

• Payments resulting from applying the Contract accumulated value to an annuity benefit payment option.

• Payment of the Contract accumulated value as a single payment.

2. GMWB payment options:

• You may elect the Investment Back withdrawal option and receive fixed scheduled payments each year in the amount of the Investment Back withdrawal benefit payment, until the Investment Back remaining withdrawal benefit base is zero. If there is any Investment Back remaining withdrawal benefit base at the time of your death (death of the first annuitant to die if the owner is not a natural person), we will continue payments as described in GMWB 1 Upon Death.

• You may elect the For Life withdrawal option and receive fixed scheduled payments each year in the amount of the For Life withdrawal benefit payment, until the later of

• the date the For Life remaining withdrawal benefit base is zero; or

• the date of your death (the death of the first annuitant to die if the owner is not a natural person).

If there is any For Life remaining withdrawal benefit base at the time of your death, we will continue payments as described in GMWB 1 Upon Death.

The For Life withdrawal option allows you to spread your withdrawal benefit payments over your lifetime. The Investment Back withdrawal option provides a faster payout of rider withdrawal benefit payments.

We will send you written notice at least 30 days prior to the maximum annuitization date and ask you to select one of the available payment options listed above. If we have not received your election as of the maximum annuitization date, we will automatically apply your Contract accumulated value to an annuity benefit payment option:

• for Contracts with one annuitant – Life Income with payments guaranteed for a period of 10 years.

• for Contracts with joint annuitants – Joint and Full Survivor Income with payments guaranteed for a period of 10 years.

Appendix G – GMWB 1 (No Longer Available for Sale)         174

GMWB 1 Upon Death

When the Contract Accumulated Value is Greater than Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is greater than zero at your death.

If you die and...	And...	Then...
You are the sole owner	Your spouse is not named as a primary beneficiary	The primary beneficiary(ies) must elect one of the following: a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only your beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are the sole owner	Your spouse is named as a primary beneficiary	Your spouse may a. continue the Contract with or without this rider as set forth below in Spousal Continuation of the GMWB 1 Rider; or b. elect one of the following: •receive the death benefit under the Contract*; •receive the Investment Back remaining withdrawal benefit base as a series of payments.** All other primary beneficiaries must elect one of the options listed above in b. Unless your spouse elects to continue the Contract with this rider, only your spouse’s and beneficiary(ies)’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is not your spouse	Your surviving owner must elect one of the following a. receive the death benefit under the Contract*; or b. receive the Investment Back remaining withdrawal benefit base as a series of payments.** Upon your death, only the surviving owner’s right to the above selected payments will continue; all other rights and benefits under the rider and Contract will terminate.
You are a joint owner	The surviving joint owner is your spouse	Your spouse may a. continue the Contract with or without this rider as set forth below in Spousal Continuation of the GMWB 1 Rider; or b. elect one of the following: • receive the death benefit under the Contract*; • receive the Investment Back remaining withdrawal benefit base as a series of payments.** Unless the surviving spouse owner elects to continue the Contract with this rider, upon your death, only your spouse’s right to the above-selected payments will continue; all other rights and benefits under the rider and Contract will terminate.

* Please see 8. DEATH BENEFIT for an explanation of the Contract’s death benefit and payment options available for the Contract’s death benefit.

** We will make payments in an amount and frequency acceptable to us. If a surviving owner or beneficiary chooses a periodic payment, it must be at least $100 per payment until the Investment Back remaining withdrawal benefit base is zero.

Appendix G – GMWB 1 (No Longer Available for Sale)         175

If...	And...	Then...
The annuitant dies	The owner is not a natural person	The beneficiary(ies) receive the death benefit under the Contract. If a beneficiary dies before the annuitant, on the annuitant’s death we will make equal payments to the surviving beneficiaries unless the owner provided us with other written instructions. If no beneficiary(ies) survive the annuitant, the death benefit is paid to the owner. Upon the annuitant’s death, only the beneficiary(ies) right to the death benefit will continue; all other rights and benefits under the Contract will terminate.

When the Contract Accumulated Value is Zero. The following table illustrates the various situations and the resulting outcomes if your Contract accumulated value is zero at your death but the rider still has value.

If you die and…	And…	Then…
You are the sole owner	You elected the For Life withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are the sole owner	You elected the Investment Back withdrawal option*	We will continue payments to your beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the For Life withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to the beneficiary(ies) according to the schedule established when you made your election until the For Life remaining withdrawal benefit base reduces to zero.
You are a joint owner	You elected the Investment Back withdrawal option*	We will continue payments to the surviving joint owner according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero. Upon the surviving joint owner’s death, we will continue payments to the beneficiary(ies) according to the schedule established when you made your election until the Investment Back remaining withdrawal benefit base reduces to zero.

* Please see Effect of the Contract Accumulated Value Reaching Zerounder the Rider, above, for details regarding election of the For Life withdrawal option or the Investment Back withdrawal option.

Appendix G – GMWB 1 (No Longer Available for Sale)         176

If...	And...	Then...
The annuitant dies	The owner is not a natural person The owner elected the For Life Withdrawal option* The owner elected the Investment Back withdrawal option*	The beneficiary(ies) receive the death benefit under the Contract. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the For Life remaining withdrawal benefit base reduces to zero. We will continue payments to the owner’s beneficiary(ies) according to the schedule established when the owner made its election until the Investment Back remaining withdrawal benefit base reduces to zero.

Spousal Continuation of the GMWB 1 Rider

If you die while this rider is in effect and if your surviving spouse elects to continue the Contract in accordance with its terms, the surviving spouse may also elect to continue this rider if

1. the Contract accumulated value is greater than zero;

2. the Contract and this rider have not been previously continued; and

3. your spouse is either

a. your primary beneficiary, if you were the sole owner; or

b. the surviving joint owner, if there were joint owners.

If your spouse elects to continue the Contract with this rider, your spouse may take withdrawals under the Investment Back withdrawal option until the Investment Back remaining withdrawal benefit base reduces to zero. The For Life withdrawal option terminates upon your death. All other provisions of this rider will continue as in effect on the date of your death.

If your spouse elects to continue the Contract without this rider, this rider and all rights, benefits and charges under this rider will terminate and cannot be reinstated.

NOTE: Although spousal continuation may be available under federal tax laws for a subsequent spouse, this rider may be continued one time only.

Effect of Divorce on the Rider

The following table illustrates divorce situations and the resulting outcomes.

If…	And…	Then…
You are the sole owner of the contract	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. You will retain all rights and benefits of the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.
You are the sole owner of the contract	You direct us to change ownership of the Contract to your former spouse to satisfy a court order	The GMWB rider will terminate. Your former spouse will become the new owner of the Contract and will retain all rights and benefits of the Contract.

Appendix G – GMWB 1 (No Longer Available for Sale)         177

If…	And…	Then…
Contract is jointly owned	You direct us to take a withdrawal to satisfy a court order to pay a portion of the Contract to your former spouse	Any portion of such withdrawal that exceeds the available withdrawal benefit payment will be deemed an excess withdrawal. If you direct us to remove one of the joint owners, the spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.
Contract is jointly owned	You direct us to remove one of the joint owners to satisfy a court order	The spouse who retains ownership of the Contract will continue to be entitled to all rights and benefits of the rider while the former spouse will no longer have any such rights or be entitled to any benefits under the rider. Note: If the excess withdrawal causes both the For Life withdrawal benefit base and Investment Back remaining withdrawal benefit base to go to zero, the rider will terminate at the next Contract anniversary unless you make additional premium payments or a GMWB Step-Up is applied. For further information, see Excess Withdrawals.

Termination and Reinstatement of the Rider

You may not terminate this rider prior to the 5th Contract anniversary following the rider effective date.

At any point in time we will terminate this rider upon the earliest to occur of

• the date you send us notice to terminate the rider (after the 5th Contract anniversary following the rider effective date). This will terminate the rider, not the Contract.

• the date you fully annuitize, fully surrender or otherwise terminate the Contract.

• the date the Investment Back remaining withdrawal benefit base and the For Life withdrawal benefit base are both zero.

• the date the Contract owner is changed (annuitant is changed if the owner is not a natural person), except a change in owner due to a spousal continuation of the rider as described above in Spousal Continuation of the GMWB 1 Rider.

• the date your surviving spouse elects to continue the Contract without this rider.

If this rider terminates for any reason other than full surrender of the Contract, this rider may not be reinstated.

If you surrender the Contract with this rider attached and the Contract is later reinstated, this rider also must be reinstated. At the time this rider is reinstated, we will deduct rider charges scheduled during the period of termination and make any other adjustments necessary to reflect any changes in the amount reinstated and the Contract accumulated value as of the date of termination.

Appendix G – GMWB 1 (No Longer Available for Sale)         178

GMWB 1 Rider -- Investment Protector Plus Summary

Name of Rider	GMWB 1
Marketing Name	Investment Protector Plus Rider
Rider Issue Age	0 – 80
Rider Charge	•Current annual charge is 0.80% of the Investment Back remaining withdrawal benefit base for rider applications signed on or after February 16, 2009. •Current annual charge is 0.60% of the Investment Back remaining withdrawal benefit base for rider applications signed before February 16, 2009. •Maximum annual charge is 0.85% of the Investment Back remaining withdrawal benefit base.
Guaranteed Minimum Withdrawal Benefits	•Investment Back •For Life
Annual Withdrawal Limits	•Investment Back — 7% of the Investment Back withdrawal benefit base. •For Life — 5% of the For Life withdrawal benefit base
For Life Withdrawal Benefit Payments	•Single Life only •Available the Contract anniversary following the date the oldest owner turns 59 ½ — all withdrawals prior to that Contract anniversary are excess withdrawals under the For Life withdrawal option
Termination	•You may terminate this Rider anytime after the 5th Contract anniversary following the rider effective date
GMWB Step-Up	•Optional GMWB Step-Up that you may elect beginning with the 5th Contract anniversary. Once you have elected a GMWB Step-Up, you must wait at least 5 contract years to elect another GMWB Step-Up. •Rider effective dates on or after June 15, 2008: the remaining withdrawal benefit bases are not eligible for Step-Ups after the Investment Back remaining withdrawal benefit base reduces to zero, even if additional premium payments are made.
GMWB Bonus	•If no withdrawals are taken, a GMWB Bonus of 5% is applied to the benefit bases each year on the Contract anniversary for the first 5 years.
Investment Restrictions	•You must select one of the GMWB investment options; there are no additional restrictions on allocations to the Fixed Account or DCA Plus accounts.

EXAMPLES

These examples have been provided to assist you in understanding the various features of this rider and to demonstrate how premium payments received and withdrawals taken from the Contract affect the values and benefits under the GMWB 1 Rider. These examples are based on certain hypothetical assumptions and are for illustrative purposes only. These examples are not intended to serve as projections of future investment returns.

NOTE: For the purpose of the following examples, a partial annuitization has the same effect as a partial surrender and both are referred to as a withdrawal in the following examples.

Examples Without Excess Withdrawals (Examples 1-5)

The examples without excess withdrawals assume the following:

• the client is age 62.

• initial premium payment = $100,000.

• the withdrawal benefit bases prior to partial surrender = $100,000.

• the remaining withdrawal benefit bases prior to partial surrender = $100,000.

• Investment Back (7%) withdrawal benefit payment = $7,000.

• For Life (5%) withdrawal benefit payment = $5,000.

Appendix G – GMWB 1 (No Longer Available for Sale)         179

Example 1

In contract year one, no withdrawals are taken.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.05 = $5,000.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + $5,000 = $105,000;

•the new Investment Back remaining withdrawal benefit base is $100,000 + $5,000 = $105,000; and

•the new Investment Back withdrawal benefit payment is $105,000 x 0.07 = $7,350.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + $5,000 = $105,000;

• the new For Life remaining withdrawal benefit base is $100,000 + $5,000 = $105,000; and

• the new For Life withdrawal benefit payment is $105,000 x 0.05 = $5,250.

Example 2

In contract year one:

• no withdrawals are taken.

• the client makes a premium payment of $50,000.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit bases. The credit is ($100,000 + $50,000) x 0.05 = $7,500.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500;

• the new Investment Back remaining withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500; and

•the new Investment Back withdrawal benefit payment is $157,500 x 0.07 = $11,025.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500;

• the new For Life remaining withdrawal benefit base is $100,000 + $50,000 + $7,500 = $157,500; and

• the new For Life withdrawal benefit payment is $157,500 x 0.05 = $7,875.

Example 3

In contract year one, the client takes a withdrawal of $5,000.

On the first Contract anniversary:

• Since a withdrawal was taken in contract year one, no GMWB bonus is credited.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($100,000);

•the new Investment Back remaining withdrawal benefit base is $100,000 - $5,000 = $95,000; and

• the Investment Back withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.07 = $7,000).

• For Life:

• the For Life withdrawal benefit base remains the same ($100,000);

• the new For Life remaining withdrawal benefit base is $100,000 - $5,000 = $95,000; and

• the For Life withdrawal benefit payment for the next contract year remains the same ($100,000 x 0.05 = $5,000).

Appendix G – GMWB 1 (No Longer Available for Sale)         180

Example 4

In contract year one, no withdrawals are taken.

On the first Contract anniversary:

• a 5% GMWB bonus is credited to the withdrawal benefit bases. The credit is $100,000 x 0.05 = $5,000.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the new Investment Back withdrawal benefit base is $100,000 + $5,000 = $105,000;

•the new Investment Back remaining withdrawal benefit base is $100,000 + $5,000 = $105,000; and

•the new Investment Back withdrawal benefit payment is $105,000 x 0.07 = $7,350.

• For Life:

• the new For Life withdrawal benefit base is $100,000 + $5,000 = $105,000;

• the new For Life remaining withdrawal benefit base is $100,000 + $5,000 = $105,000; and

• the new For Life withdrawal benefit payment is $105,000 x 0.05 = $5,250.

In contract year two, the client takes a withdrawal of $5,000.

On the second Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($105,000);

•the new Investment Back remaining withdrawal benefit base is $105,000 - $5,000 = $100,000; and

• the Investment Back withdrawal benefit payment for the next contract year remains the same ($7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the new For Life remaining withdrawal benefit base is $105,000 - $5,000 = $100,000; and

• the For Life withdrawal benefit payment for the next contract year remains the same ($5,250).

In contract year three, no withdrawals are taken.

On the third Contract anniversary:

• Since a withdrawal was taken in contract year two, no GMWB bonus is credited.

• there is no GMWB Step-Up because the client is not eligible until the fifth Contract anniversary following the rider effective date.

• Investment Back:

•the Investment Back withdrawal benefit base remains the same ($105,000);

•the Investment Back remaining withdrawal benefit base remains the same ($100,000); and

• the Investment Back withdrawal benefit payment for the next contract year remains the same ($7,350).

• For Life:

• the For Life withdrawal benefit base remains the same ($105,000);

• the For Life remaining withdrawal benefit base remains the same ($100,000); and

• the For Life withdrawal benefit payment for the next contract year remains the same ($5,250).

Appendix G – GMWB 1 (No Longer Available for Sale)         181

Example 5

In each of the first five contract years, the client takes a withdrawal of $5,000. No GMWB Bonus is credited since a withdrawal was taken in contract year one. On the fifth Contract anniversary, the client will receive GMWB Step-Up if the Contract’s accumulated value is greater than the Investment Back remaining withdrawal benefit base.

If the accumulated value on the fifth contract anniversary is:	$90,000	$110,000
Investment Back
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.07 = $7,000	$100,000 x 0.07 = $7,000
Remaining Withdrawal Benefit Base	$75,000	$75,000
After step-up
Withdrawal Benefit Base	$90,000	$110,000
Withdrawal Benefit Payment	$90,000 x 0.07 = $6,300	$110,000 x 0.07 = $7,700
Remaining Withdrawal Benefit Base	$90,000	$110,000
For Life
Prior to step-up
Withdrawal Benefit Base	$100,000	$100,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $5,000	$100,000 x 0.05 = $5,000
Remaining withdrawal Benefit Base	$75,000	$75,000
After step-up
Withdrawal Benefit Base	$90,000	$110,000
Withdrawal Benefit Payment	$100,000 x 0.05 = $4,500	$110,000 x 0.05 = $5,500
Remaining Withdrawal Benefit Base	$90,000	$110,000

Examples With Excess Withdrawals (Examples 6-7)

The excess withdrawal examples assume the following:

• the client is age 62

• the initial premium payment is $100,000

• the Investment Back and For Life withdrawal benefit bases prior to partial surrender = $100,000

• the remaining withdrawal benefit bases prior to withdrawal = $100,000

• Investment Back (7%) withdrawal benefit payment = $7,000

• For Life (5%) withdrawal benefit payment = $5,000

• Withdrawal taken = $8,000

•excess amount under the Investment Back withdrawal option is $1,000; and

•excess amount under the For Life withdrawal option is $3,000

Example 6

In this example, assume the accumulated value prior to the withdrawal is $90,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit base is adjusted for any excess withdrawals.

Appendix G – GMWB 1 (No Longer Available for Sale)         182

Investment Back

The amount of the adjustment* is $1,204.82. The new Investment Back withdrawal benefit base is $100,000 - $1,204.82 = $98,795.18.

* The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $1,204.82 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

For Life

The amount of the adjustment* is $3,529.41. The new For Life withdrawal benefit base is $100,000 - $3,529.41 = $96,470.59.

* The amount of the adjustment for the excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $3,529.41 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

2 = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Investment Back

The amount of the adjustment* is $8,120.48 (the amount of the Investment Back withdrawal benefit payment plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,120.48 = $91,879.52

* The amount of the adjustment is a plus b where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,120.48 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $1,120.48 (the result of (x divided by y) multiplied by z) where;

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

Appendix G – GMWB 1 (No Longer Available for Sale)         183

For Life

The amount of the adjustment* is $8,352.94 (the amount of the For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,352.94 = $91,647.06.

* The amount of the adjustment is (a plus b) where:

a = $5,000 (the actual amount withdrawn that does not exceed the For Life withdrawal benefit payment); and

b = $3,352.94 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $3,352.94 (the result of (x divided by y) multiplied by z) where;

x = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

y = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($90,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $98,795.18 x 0.07 = $6,915.66.

For Life

The new “Single Life” For Life withdrawal benefit payment is $96,470.59 x 0.05 = $4,823.53.

Example 7

In this example, assume the accumulated value prior to the withdrawal is $110,000.

Withdrawal Benefit Base Calculation

On the Contract anniversary following the withdrawal, the withdrawal benefit bases are adjusted for any excess withdrawals.

Investment Back

The amount of the adjustment* is $1,000 (the amount of the excess withdrawal). The new Investment Back withdrawal benefit base is $100,000 - $1,000 = $99,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $1,000 (the amount of the excess withdrawal); and

b = $970.87 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

2 = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $7,000); and

3 = the Investment Back withdrawal benefit base prior to the adjustment for the excess amount ($100,000)

Appendix G – GMWB 1 (No Longer Available for Sale)         184

For Life

The amount of the adjustment* is $3,000 (the amount of the excess withdrawal). The new For Life withdrawal benefit base is $100,000 - $3,000 = $97,000.

* The amount of the adjustment for excess withdrawal is the greater of a or b where:

a = $3,000 (the amount of the excess withdrawal); and

b = $2,857.14 (the result of (1 divided by 2) multiplied by 3) where:

1 = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

2 = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 minus $5,000); and

3 = the For Life withdrawal benefit base prior to the adjustment for the excess amount ($100,000).

Remaining Withdrawal Benefit Base Calculation

The remaining withdrawal benefit base is adjusted when withdrawals are taken.

Investment Back

The amount of the adjustment* is $8,000 (the amount of the Investment Back withdrawal benefit payment plus the excess withdrawal). The new Investment Back remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is (a plus b) where:

a = $7,000 (the actual amount withdrawn that does not exceed the Investment Back withdrawal benefit payment); and

b = $1,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $1,000 (the amount of the excess withdrawal); and

2 = $902.91 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the Investment Back withdrawal benefit payment available prior to the withdrawal ($1,000);

y = the accumulated value after the Investment Back withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $7,000); and

z = the Investment Back remaining withdrawal benefit base after the Investment Back withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $7,000).

For Life

The amount of the adjustment* is $8,000 (the amount of the For Life withdrawal benefit payment plus the excess withdrawal). The new For Life remaining withdrawal benefit base is $100,000 - $8,000 = $92,000.

* The amount of the adjustment is (a plus b) where:

a = $5,000 (the actual amount withdrawn that does not exceed the For Life withdrawal benefit payment); and

b = $3,000 (a proportionate reduction for the excess withdrawal). The amount of the proportionate reduction is the greater of 1 or 2 where:

1 = $3,000 (the amount of the excess withdrawal); and

2 = $2,714.28 (the result of (x divided by y) multiplied by z) where:

x = the amount of the withdrawal greater than the For Life withdrawal benefit payment available prior to the withdrawal ($3,000);

y = the accumulated value after the For Life withdrawal benefit payment is deducted but prior to the withdrawal of the excess amount ($110,000 - $5,000); and

z = the For Life remaining withdrawal benefit base after the For Life withdrawal benefit payment is deducted but prior to the adjustment for the excess amount ($100,000 - $5,000).

Appendix G – GMWB 1 (No Longer Available for Sale)         185

Withdrawal Benefit Payment Calculation (for the next contract year)

The withdrawal benefit payment is the new withdrawal benefit base (calculated on the Contract anniversary) multiplied by the associated percentage. The For Life withdrawal benefit payment percentage is locked-in at 5%.

Investment Back

The new Investment Back withdrawal benefit payment is $99,000 x 0.07 = $6,930.

For Life

The new For Life withdrawal benefit payment is $97,000 x 0.05 = $4,850.

Appendix G – GMWB 1 (No Longer Available for Sale)         186

APPENDIX H - ENHANCED DEATH BENEFIT RIDER (NO LONGER AVAILABLE FOR SALE)

For rider applications signed on or after January 4, 2010, the Enhanced Death Benefit Rider is not available.

The annual charge for this rider is 0.25% of the accumulated value (0.15% in New York and Washington). The charge is taken at the end of the calendar quarter at a quarterly rate of 0.0625% (0.0375% in New York and Washington) of the average accumulated value during the calendar quarter. We reserve the right to increase this charge to an annual maximum of 0.30% (0.075% quarterly) of the average accumulated value during the calendar quarter. The average quarterly accumulated value is equal to the accumulated value at the beginning of the calendar quarter plus the accumulated value at the end of the calendar quarter and the sum is divided by two.

The charge is deducted through the redemption of units from youraccumulated value in the same proportion as the surrender allocation percentages. If this rider is purchased after the beginning of a quarter, this charge is prorated according to the number of days it is in effect during the quarter. Upon termination of this rider or upon your death (annuitant’s death, if the owner is not a natural person), this charge will be based on the number of days this rider is in effect during the quarter.

The rider charge is intended to reimburse us for the cost of the potentially greater death benefit provided by this rider.

The Enhanced Death Benefit Rider provides you with the greater of the enhanced death benefit (described below) or the standard death benefit (see 8. DEATH BENEFIT).

Prior to the annuitization date and prior to the lock-in date (the later of the Contract anniversary following the oldest owner’s 75th birthday or five years after the rider effective date), the enhanced death benefit is the greatest of a, b or c, where:

a = 1 minus 2 where:

1 = the total of premium payments made since the rider effective date increased at a 5% effective annual interest rate; and

2 = an adjustment for each partial surrender and each partial annuitization made since the rider effective date increased at a 5% effective annual interest rate.

b = (1 plus 2) minus 3 where:

1 = the highest accumulated value on any Contract anniversary since the rider effective date;

2 = any premium payments received since that Contract anniversary; and

3 = an adjustment for each partial surrender and each partial annuitization made since that Contract anniversary.

c = the standard death benefit (see 8. DEATH BENEFIT)

After the lock-in date but prior to the annuitization date, the enhanced death benefit is the greatest of d, e or f, where:

d = (1 plus 2) minus 3 where:

1 = the value from item a above as of the lock-in date

2 = any premium payments received since the lock-in date

3 = an adjustment for each partial surrender and each partial annuitization made since the lock-in date.

e = (1 plus 2) minus 3 where:

1 = the value from item b above as of the lock-in date

2 = any premium payments received since the lock-in date

3 = an adjustment for each partial surrender and each partial annuitization made since the lock-in date.

f = the standard death benefit.

The adjustment for each partial surrender or partial annuitization is (1 divided by 2) multiplied by 3, where:

1 = the amount of the partial surrender (plus surrender charge, if any) or the amount of the partial annuitization;

2 = the accumulated value immediately prior to the partial surrender or partial annuitization; and

3 = the amounts determined in items a or b (d or e after the lock-in date) immediately prior to the partial surrender or partial annuitization.

NOTE: For Contracts issued in New York and Washington — under this rider, if the original owner dies before the annuitization date and before the lock-in date, the enhanced death benefit payable to the beneficiary is the greater of items b or c above. If the original owner dies before the annuitization date and after the lock-in date, the enhanced death benefit payable to the beneficiary is the greater of items e or f above.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     187

When available, this rider can only be elected at the time the Contract is issued. You may terminate this rider at any time. Once this rider is terminated, it cannot be reinstated.

This rider terminates on the earliest of the following:

1. the date the Contract owner is changed; or

2. the death of the owner; or

3. the date the Contract terminates; or

4. after the Lock-In Date, the date the death benefit described in the Contract equals the enhanced death benefit under this rider; or

5. the date We receive your request to cancel it in our office.

EXAMPLES OF CALCULATION OF ENHANCED DEATH BENEFIT

For all examples, assume

Contract issue date is 01/01/2005

Original premium payment = $100,000

Owner's age on issue date is 69 years

CALCULATION OF THE ENHANCED DEATH BENEFIT ON THE FOURTH CONTRACT ANNIVERSARY (01/01/ 2009) (prior to the lock-in date)

Assume the following:

Accumulated value (AV) = $105,000

Additional premium payments = $0

Partial surrenders and partial annuitizations = $0

Owner age = 73

The enhanced death benefit is the greatest of a, b, and c below.

a. $121,550.63 = [$100,000 x (1.05)⁴] + $0 - $0 = $121,550.63 + $0 (premium payments made since the rider effective date increased at a 5% effective annual interest rate - $0 (adjustments for all partial surrenders and partial annuitizations taken since the rider effective date increased at a 5% effective annual interest rate)

b. $105,000 = $105,000 + $0 - $0 = (highest accumulated value on any Contract anniversary since the rider effective date) + (additional premium payments made since that Contract anniversary) - (adjustments for all partial surrenders and partial annuitizations taken since that Contract anniversary)

c. Standard death benefit = $105,000 where the standard death benefit is the greater of

i. $105,000 = AV

ii. $100,000 = $100,000 +$0 - $0 = [(original premium payment) + (premium payments made after the Contract issue date)] - (adjustments for all partial surrenders and partial annuitization taken since the Contract issue date)

The enhanced death benefit is $121,550.63 on the fourth Contract anniversary.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     188

CALCULATION OF THE ENHANCED DEATH BENEFIT AFTER THE FOURTH CONTRACT ANNIVERSARY WHEN ADDITIONAL PREMIUM PAYMENT IS MADE (and prior to the lock-in date)

Assume the following:

AV immediately prior to premium payment = $106,000

Additional premium payment = $50,000

AV after premium payment = $156,000

Partial surrenders and partial annuitizations = $0

Owner age = 73

The enhanced death benefit after the premium payment is the greatest of a, b, and c below.

a. $171,550.63 = $121,550.63 + $50,000 - $0

b. $155,000 = $105,000 + $50,000 - $0

c. Standard death benefit = $156,000 where the standard death benefit is the greater of

i. $156,000 = AV

ii. $150,000 = $100,000 + $50,000 - $0

The enhanced death benefit is $171,550.63

CALCULATION OF THE ENHANCED DEATH BENEFIT ON THE FIFTH CONTRACT ANNIVERSARY (01/01/2010) (and prior to the lock-in date)

Assume the following:

AV = $159,000

Additional premium payments since last Contract anniversary = $0

Partial surrenders/annuitizations since last Contract anniversary = $0

Age of owner = 74

The enhanced death benefit is the greatest of a, b, and c below.

a. $180,128.16 = [$171,550.63 x (1.05)] + $0 - $0 = $180,128.16 + $0 - $0

b. $159,000 = $159,000 + $0 - $0

c. Standard death benefit = $159,000 where the standard death benefit is the greater of

i. $159,000 = AV

ii. $150,000 = $150,000 + $0 - $0

The enhanced death benefit is $180,128.16.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     189

CALCULATION OF THE ENHANCED DEATH BENEFIT on 06/30/2010 -- AFTER THE FIFTH CONTRACT ANNIVERSARY and DATE WHEN PARTIAL SURRENDER HAS BEEN TAKEN (06/30/2010)(and prior to the lock-in date)

Assume the following:

AV prior to partial surrender = $155,000

Partial surrender on 06/30/2010 = $10,000

AV after partial surrender = $145,000

Age of owner = 74

The enhanced death benefit after the partial surrender is the greatest of a, b, and c below.

a. $172,664.93 = $180,128.16 x [1.05 x (180/365)] + $0 - [($10,000/$155,000) x 180,128.16 x (1.05 x {181/365})] = $184,569.67 + $0 - $11,904.74

b. $148,744.50 = $159,000 + $0 - [($10,000/$155,000) x $159,000] = $159,000 + $0 - $10,255.50

c. Standard death benefit = $145,000 where the standard death benefit is the greater of

i. $145,000 = AV

ii. $140,325.00 = $150,000 + $0 - [($10,000/$155,000) x $150,000] = $150,000 + $0 - $9,675.00

The enhanced death benefit is $172,664.93

CALCULATION OF THE ENHANCED DEATH BENEFIT ON THE SIXTH CONTRACT ANNIVERSARY (01/01/ 2012)(and lock-in date)

Assume the following:    

AV = $150,000

Premium payments since last Contract anniversary = $0

Partial surrenders/annuitizations since last Contract anniversary = $0

Age of owner = 75

The enhanced death benefit is the greatest of a, b, and c below.

a. $177,040.60 = $172,664.93 x [1.05 x (185/365)] + $0 - $0 = $177,040.60 + $0 - $0

b. $150,000 = $150,000 + $0 - $0

c. Standard death benefit = $150,000 where the standard death benefit is the greater of

i. $150,000 = AV

iii. $140,325.00 = $140,325.00 + $0 - $0

The enhanced death benefit is $177,040.60. The enhanced death benefit is now locked-in and will only increase for any purchase payments received and decrease for any partial surrenders and partial annuitizations taken.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     190

CALCULATION OF THE ENHANCED DEATH BENEFIT ON 06/30/2012 - AFTER THE SIXTH CONTRACT ANNIVERSARY and DATE WHEN ADDITIONAL PREMIUM PAYMENT IS MADE and AFTER LOCK-IN

Assume the following:    

AV before premium payment made = $150,000

06/30/2012 premium payment = $5,000

AV after premium payment made = $155,000

The enhanced death benefit after the premium payment is the greatest of a, b, and c below.

a.     $182,040.60 = $177,040.60 + $5,000 - $0

b.     $155,000 = $150,000 + $5,000 - $0

c.     Standard death benefit = $155,000 where the standard death benefit is the greater of

i.     $155,000 = AV (after premium payment made)

ii.     $145,325 = $140,325 + $5,000 - $0

The enhanced death benefit is $182,040.60

CALCULATION OF THE ENHANCED DEATH BENEFIT AFTER THE SEVENTH CONTRACT ANNIVERSARY (01/ 01/2012) and AFTER LOCK-IN

Assume the following:    

AV = $160,000

Premium payments since lock-in date = $0

Partial Surrenders/annuitizations since lock-in date = $0

Age of owner = 76

Although the enhanced death benefit is now past the lock-in date, the standard death benefit may increase to the Contract AV on any Contract anniversary divisible by seven (e.g., 7, 14, 21). The enhanced death benefit is the greatest of a, b, and c below.

a.    $182,040.60 = $182,040.60 + $0 - $0

b.    $155,000 = $155,000 + $0 - $0

c.    Standard death benefit = $160,000 where the standard death benefit is the greatest

i. $160,000 = AV on seventh Contract anniversary

ii. $145,325 = $145,325 + $0 - $0

iii. $160,000 = $160,000 + $0 - $0 = [(seventh Contract anniversaryaccumulated value) + (additional premium payments made since that Contract anniversary) - (adjustments for all partial surrenders and partial annuitizations since that Contract anniversary)]

The enhanced death benefit is $182,040.60.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     191

CALCULATION OF THE ENHANCED DEATH BENEFIT on 06/30/2012 - DATE WHEN PARTIAL SURRENDER TAKEN and AFTER SEVENTH CONTRACT ANNIVERSARY and AFTER LOCK-IN

Assume the following:

AV ON 6/30/2012 prior to partial surrender = $190,000

Partial surrender = $5,000

AV after the partial surrender = $185,000

The enhanced death benefit after the surrender is the greatest of a, b, and c below.

a. $177,252.93 = $182,040.60 + $0 - [($5,000/$190,000) x $182,040.60] = $182,040.60 + $0 - $4,787.67

b. $150,923.50 = $155,000 + $0 - [($5,000/$190,000) x $155,000] = $155,000 + $0 - $4,076.50

c. Standard death benefit = $185,000 where the standard death benefit is the greatest of

i. $185,000 = AV

ii. $141,502.95 = $145,325 + $0 - [($5,000/$190,000) x $145,325] = $145,325 + $0 - $3,822.05

iii. $155,792 = $160,000 + $0 - [($5,000/$190,000) x $160,000] = $160,000 + $0 - $4,208.00

The enhanced death benefit is $185,000.

CALCULATION OF THE ENHANCED DEATH BENEFIT on 06/30/2013 - DATE WHEN PARTIAL SURRENDER TAKEN and AFTER LOCK-IN

Assume the following:

AV prior to partial surrender = $110,000

Partial surrender - $10,000

AV after partial surrender = $100,000

The enhanced death benefit after the partial surrender is the greatest of a, b, and c below.

a.     $161,140.64 = $177,252.93 + $0 - [($10,000/$110,000) x $177,252.93] = $177,252.93 + $0 - $16,112.29

b.     $137,204.55 = $150,923.50 + $0 - ($10,000/$110,000) x $150,923.50 = $150,923.50 + $0 - $13,718.95

c. Standard death benefit = $141,630.51 where the standard death benefit is the greatest of

i. $100,000 = accumulated value

ii. $128,640.33 = $141,502.95 + $0 - [($10,000/$110,000) x $141,502.95] = $141,502.95 + $0 - $12,862.62

iii. $141,630.51 = $155,792 + $0 - [($10,000/$110,000) x $155,792] = $155,792 + $0 - $14,161.49

The enhanced death benefit is $161,140.64.

Appendix H – Enhanced Death Benefit Rider (No Longer Available for Sale)     192

APPENDIX I - CONDENSED FINANCIAL INFORMATION

Financial statements are included in the Statement of Additional Information.

The following table contains the unit values for the Contract without the Premium Payment Credit Rider for the periods ended December 31.

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
AllianceBernstein Small Cap Growth
2019	$34.061	$45.814	34.51%	96
2018	34.855	34.061	-2.28	120
2017	26.352	34.855	32.27	123
2016	25.102	26.352	4.98	139
2015	25.778	25.102	-2.62	153
2014	26.624	25.778	-3.18	158
2013	18.519	26.624	43.77	174
2012	16.304	18.519	13.59	164
2011	15.804	16.304	3.16	170
2010	11.689	15.804	35.20	168
AllianceBernstein Small/Mid Cap Value
2019	13.155	15.579	18.43	253
2018	15.701	13.155	-16.22	254
2017	14.072	15.701	11.58	252
2016	11.408	14.072	23.35	203
2015	12.240	11.408	-6.80	183
2014	11.367	12.240	7.68	131
2013(1)	10.000	11.367	13.67	57
American Century VP Capital Appreciation
2019	12.403	16.580	33.68	100
2018	13.268	12.403	-6.52	147
2017	11.047	13.268	20.11	156
2016	10.853	11.047	1.79	193
2015	10.797	10.853	0.52	211
2014(2)	10.000	10.797	7.97	199
American Century VP Inflation Protection
2019	12.715	13.654	7.39	2,336
2018	13.269	12.715	-4.18	2,643
2017	12.979	13.269	2.23	3,147
2016	12.609	12.979	2.93	3,410
2015	13.110	12.609	-3.82	3,887
2014	12.870	13.110	1.86	4,504
2013	14.248	12.870	-9.67	5,079
2012	13.436	14.248	6.05	4,968
2011	12.175	13.436	10.36	4,861
2010	11.730	12.175	3.79	5,503

Appendix I – Condensed Financial Information         193

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
American Century VP Mid Cap Value
2019	$21.189	$26.952	27.20%	278
2018	24.689	21.189	-14.18	296
2017	22.461	24.689	9.92	312
2016	18.561	22.461	21.01	309
2015	19.125	18.561	-2.95	243
2014	16.685	19.125	14.62	168
2013	13.014	16.685	28.21	120
2012	11.339	13.014	14.77	111
2011	11.579	11.339	-2.08	57
2010(3)	10.000	11.579	15.79	17
American Century VP Ultra
2019	25.635	33.990	32.59	761
2018	25.844	25.635	-0.81	994
2017	19.854	25.844	30.17	1,248
2016	19.294	19.854	2.90	1,583
2015	18.450	19.294	4.57	1,765
2014	17.035	18.450	8.31	2,159
2013	12.606	17.035	35.13	2,594
2012	11.219	12.606	12.37	3,367
2011	11.263	11.219	-0.39	3,824
2010	9.847	11.263	14.38	3,933
American Funds Asset Allocation
2019	11.476	13.719	19.55	108
2018	12.201	11.476	-5.94	116
2017	10.644	12.201	14.62	94
2016(4)	10.000	10.644	6.44	41
American Funds Blue Chip Income and Growth
2019	11.621	13.909	19.69	138
2018	12.902	11.621	-9.93	137
2017	11.179	12.902	15.42	146
2016(4)	10.000	11.179	11.79	95
American Funds Global Small Capitalization
2019	9.634	12.494	29.69	75
2018	10.923	9.634	-11.80	85
2017	8.798	10.923	24.15	62
2016	8.739	8.798	0.68	67
2015(5)	10.000	8.739	-12.61	54
American Funds New World
2019	10.025	12.767	27.35	96
2018	11.827	10.025	-15.24	83
2017	9.266	11.827	27.64	86
2016	8.927	9.266	3.80	74
2015(5)	10.000	8.927	-10.73	23

Appendix I – Condensed Financial Information         194

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
BlackRock Global Allocation VI
2019	$9.716	$11.282	16.11%	88
2018	10.661	9.716	-8.87	93
2017	9.508	10.661	12.13	88
2016	9.289	9.508	2.36	85
2015(5)	10.000	9.289	-7.11	43
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)
2019	10.113	12.089	19.54	7
2018	10.817	10.113	-6.50	7
2017	9.562	10.817	13.13	7
2016	9.134	9.562	4.69	5
2015(5)	10.000	9.134	-8.66	3
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)
2019	33.126	40.999	23.77	190
2018	34.027	33.126	-2.65	232
2017	24.238	34.027	40.39	253
2016	23.548	24.238	2.93	215
2015	22.546	23.548	4.44	223
2014	21.453	22.546	5.09	178
2013	16.406	21.453	30.76	170
2012	14.402	16.406	13.91	159
2011	15.859	14.402	-9.19	146
2010	12.385	15.859	28.05	202
Columbia Limited Duration Credit
2019	9.824	10.411	5.97	14
2018	9.965	9.824	-1.41	10
2017	9.926	9.965	0.39	9
2016	9.561	9.926	3.82	12
2015(5)	10.000	9.561	-4.39	7
Delaware VIP Limited Term Diversified Income
2019	9.808	10.137	3.35	11
2018	9.943	9.808	-1.36	11
2017	9.893	9.943	0.51	6
2016	9.862	9.893	0.31	49
2015(5)	10.000	9.862	-1.38	14
Delaware VIP Small Cap Value
2019	12.769	16.081	25.94	117
2018	15.592	12.769	-18.11	122
2017	14.147	15.592	10.21	121
2016	10.945	14.147	29.26	110
2015	11.866	10.945	-7.76	68
2014	11.393	11.866	4.15	48
2013(1)	10.000	11.393	13.93	14

Appendix I – Condensed Financial Information         195

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
DWS Small Mid Cap Value
2019	$11.706	$13.967	19.31%	53
2018	14.189	11.706	-17.50	55
2017	13.064	14.189	8.61	57
2016	11.375	13.064	14.85	65
2015	11.797	11.375	-3.58	60
2014	11.383	11.797	3.64	39
2013(1)	10.000	11.383	13.83	8
EQ Advisors Trust 1290 VT Convertible Securities Portfolio
2019(6)	10.000	10.888	8.88	-
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio
2019(6)	10.000	10.834	8.34	-
EQ Advisors Trust 1290 VT Micro Cap Portfolio
2019(6)	10.000	10.898	8.98	-
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio
2019(6)	10.000	10.817	8.17	4
EQ Advisors Trust 1290 VT Socially Responsible Portfolio
2019(6)	10.000	11.203	12.03	-
Fidelity VIP Contrafund®
2019	26.561	34.383	29.45	1,213
2018	28.853	26.561	-7.94	1,445
2017	24.064	28.853	19.90	1,636
2016	22.652	24.064	6.23	1,834
2015	22.877	22.652	-0.98	2,022
2014	20.778	22.877	10.10	2,136
2013	16.076	20.778	29.25	2,258
2012	14.017	16.076	14.69	2,514
2011	14.599	14.017	-3.99	2,728
2010	12.643	14.599	15.47	2,671
Fidelity VIP Equity-Income
2019	19.533	24.483	25.34	409
2018	21.659	19.533	-9.82	438
2017	19.497	21.659	11.09	479
2016	16.797	19.497	16.07	489
2015	17.788	16.797	-5.57	547
2014	16.629	17.788	6.97	553
2013	13.181	16.629	26.16	549
2012	11.403	13.181	15.59	547
2011	11.471	11.403	-0.60	558
2010	10.107	11.471	13.49	558
Fidelity VIP Government Money Market
2019	9.846	9.905	0.60	1,199
2018	9.824	9.846	0.22	1,674
2017	9.894	9.824	-0.71	1,523
2016(7)	10.000	9.894	-1.06	2,223

Appendix I – Condensed Financial Information         196

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Fidelity VIP Growth
2019	$27.103	$35.807	32.11%	310
2018	27.607	27.103	-1.83	344
2017	20.765	27.607	32.95	381
2016	20.943	20.765	-0.85	389
2015	19.866	20.943	5.42	425
2014	18.148	19.866	9.47	384
2013	13.520	18.148	34.23	336
2012	11.967	13.520	12.98	340
2011	12.122	11.967	-1.28	379
2010	9.909	12.122	22.33	467
Fidelity VIP Mid Cap
2019	27.736	33.688	21.46	511
2018	33.004	27.736	-15.96	580
2017	27.766	33.004	18.87	637
2016	25.158	27.766	10.37	663
2015	25.935	25.158	-3.00	654
2014	24.805	25.935	4.56	604
2013	18.497	24.805	34.10	525
2012	16.350	18.497	13.13	484
2011	18.571	16.350	-11.96	507
2010	14.626	18.571	26.97	558
Fidelity VIP Overseas
2019	16.431	20.659	25.73	1,065
2018	19.618	16.431	-16.24	1,292
2017	15.304	19.618	28.19	1,369
2016	16.383	15.304	-6.59	1,662
2015	16.084	16.383	1.86	1,780
2014	17.787	16.084	-9.57	2,020
2013	13.836	17.787	28.56	2,015
2012	11.627	13.836	19.00	2,387
2011	14.233	11.627	-18.31	2,626
2010	12.761	14.233	11.53	2,507
Franklin Global Real Estate VIP
2019	9.504	11.469	20.68	28
2018	10.340	9.504	-8.08	25
2017	9.491	10.340	8.94	21
2016	9.573	9.491	-0.86	19
2015(5)	10.000	9.573	-4.27	6

Appendix I – Condensed Financial Information         197

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Franklin Small Cap Value VIP
2019	$20.621	$25.692	24.59%	129
2018	24.005	20.621	-14.10	144
2017	21.999	24.005	9.12	160
2016	17.136	21.999	28.38	192
2015	18.764	17.136	-8.68	151
2014	18.920	18.764	-0.82	160
2013	14.071	18.920	34.46	153
2012	12.036	14.071	16.91	121
2011	12.663	12.036	-4.95	123
2010(8)	10.000	12.663	26.63	27
Franklin Templeton Global Bond VIP
2019	9.588	9.630	0.44	82
2018	9.543	9.588	0.47	82
2017	9.510	9.543	0.35	76
2016	9.375	9.510	1.44	47
2015(5)	10.000	9.375	-6.25	25
Goldman Sachs VIT Mid Cap Value
2019	23.533	30.522	29.70	362
2018	26.654	23.533	-11.71	426
2017	24.335	26.654	9.53	478
2016	21.737	24.335	11.95	551
2015	24.289	21.737	-10.51	634
2014	21.688	24.289	11.99	659
2013	16.535	21.688	31.16	625
2012	14.134	16.535	16.99	686
2011	15.286	14.134	-7.54	788
2010	12.383	15.286	23.45	812
Goldman Sachs VIT Small Cap Equity Insights
2019	21.331	26.260	23.11	202
2018	23.675	21.331	-9.90	244
2017	21.519	23.675	10.02	267
2016	17.713	21.519	21.49	299
2015	18.353	17.713	-3.49	325
2014	17.405	18.353	5.45	342
2013	13.003	17.405	33.85	315
2012	11.670	13.003	11.42	346
2011	11.738	11.670	-0.58	418
2010	9.134	11.738	28.50	395
Guggenheim Floating Rate Strategies Series F
2019	10.378	11.011	6.10	155
2018	10.610	10.378	-2.19	213
2017	10.399	10.610	2.03	112
2016	9.714	10.399	7.05	116
2015(5)	10.000	9.714	-2.86	51

Appendix I – Condensed Financial Information         198

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Guggenheim Global Managed Futures Strategy
2019	$7.801	$8.319	6.64%	7
2018	8.697	7.801	-10.30	7
2017	8.113	8.697	7.20	6
2016	9.652	8.113	-15.94	7
2015(5)	10.000	9.652	-3.48	-
Guggenheim Long Short Equity Fund
2019	9.535	9.923	4.07	1
2018	11.107	9.535	-14.16	5
2017	9.806	11.107	13.26	2
2016	9.880	9.806	-0.75	2
2015(5)	10.000	9.880	-1.20	2
Guggenheim Multi-Hedge Strategies
2019	9.386	9.719	3.55	32
2018	10.027	9.386	-6.40	33
2017	9.808	10.027	2.24	40
2016	9.995	9.808	-1.87	35
2015(5)	10.000	9.995	-0.05	2
Invesco Global Health Care
2019	11.090	14.490	30.66	53
2018	11.146	11.090	-0.50	52
2017	9.759	11.146	14.22	50
2016(4)	10.000	9.759	-2.41	28
Invesco V.I. International Growth
2019	10.671	13.530	26.79	473
2018	12.729	10.671	-16.17	571
2017	10.494	12.729	21.30	693
2016	10.690	10.494	-1.83	832
2015	11.101	10.690	-3.70	870
2014	11.220	11.101	-1.06	853
2013	9.543	11.220	17.57	720
2012	8.353	9.543	14.25	661
2011	9.046	8.353	-7.66	621
2010	8.115	9.046	11.47	446
Invesco V.I. SmallCap Equity
2019	22.295	27.832	24.84	160
2018	26.626	22.295	-16.27	165
2017	23.673	26.626	12.47	193
2016	21.422	23.673	10.51	209
2015	22.993	21.422	-6.83	235
2014	22.780	22.993	0.94	244
2013	16.790	22.780	35.68	242
2012	14.928	16.790	12.47	252
2011	15.226	14.928	-1.96	273
2010	11.994	15.226	26.95	219

Appendix I – Condensed Financial Information         199

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Invesco V.I. Value Opportunities
2019	$14.269	$18.378	28.80%	174
2018	17.905	14.269	-20.31	195
2017	15.460	17.905	15.81	224
2016	13.249	15.460	16.69	269
2015	14.996	13.249	-11.65	300
2014	14.264	14.996	5.13	305
2013	10.805	14.264	32.01	325
2012	9.296	10.805	16.23	352
2011	9.709	9.296	-4.26	389
2010	9.157	9.709	6.02	363
Janus Flexible Bond
2019	9.814	10.575	7.75	54
2018	10.082	9.814	-2.66	43
2017	9.892	10.082	1.92	84
2016(4)	10.000	9.892	-1.08	81
MFS International Intrinsic Value (f.k.a. MFS International Value)
2019	10.808	13.392	23.91	279
2018	12.142	10.808	-10.99	292
2017	9.709	12.142	25.06	366
2016	9.482	9.709	2.39	216
2015(5)	10.000	9.482	-5.18	60
MFS New Discovery
2019	13.493	18.797	39.31	76
2018	13.923	13.493	-3.09	75
2017	11.176	13.923	24.58	60
2016	10.417	11.176	7.29	60
2015	10.796	10.417	-3.51	65
2014	11.835	10.796	-8.78	56
2013(1)	10.000	11.835	18.35	21
MFS Utilities
2019	23.384	28.778	23.07	368
2018	23.525	23.384	-0.60	408
2017	20.836	23.525	12.91	464
2016	18.995	20.836	9.69	480
2015	22.598	18.995	-15.94	483
2014	20.377	22.598	10.90	456
2013	17.174	20.377	18.65	358
2012	15.362	17.174	11.80	259
2011	14.604	15.362	5.19	178
2010	13.028	14.604	12.10	84

Appendix I – Condensed Financial Information         200

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
MFS Value
2019	$24.470	$31.249	27.70%	160
2018	27.684	24.470	-11.61	177
2017	23.923	27.684	15.72	207
2016	21.323	23.923	12.19	211
2015	21.827	21.323	-2.31	209
2014	20.086	21.827	8.67	200
2013	15.009	20.086	33.83	184
2012	13.115	15.009	14.44	102
2011	13.342	13.115	-1.70	97
2010	12.147	13.342	9.84	100
Neuberger Berman AMT Mid Cap Growth
2019	11.151	14.567	30.63	146
2018	12.102	11.151	-7.86	167
2017	9.852	12.102	22.84	190
2016	9.592	9.852	2.71	233
2015(5)	10.000	9.592	-4.08	260
Neuberger Berman AMT Sustainable Equity
2019	24.395	30.283	24.14	206
2018	26.244	24.395	-7.05	129
2017	22.471	26.244	16.79	157
2016	20.742	22.471	8.34	189
2015	21.133	20.742	-1.85	221
2014	19.415	21.133	8.85	246
2013	14.296	19.415	35.81	315
2012	13.044	14.296	9.60	374
2011	13.628	13.044	-4.28	401
2010	11.232	13.628	21.33	373
PIMCO VIT All Asset
2019	15.009	16.561	10.34	137
2018	16.092	15.009	-6.73	170
2017	14.372	16.092	11.97	210
2016	12.906	14.372	11.36	246
2015	14.380	12.906	-10.25	297
2014	14.514	14.380	-0.92	328
2013	14.666	14.514	-1.04	292
2012	12.921	14.666	13.51	263
2011	12.832	12.921	0.69	170
2010	11.489	12.832	11.69	153

Appendix I – Condensed Financial Information         201

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
PIMCO VIT High Yield Portfolio
2019	$15.047	$17.026	13.15%	889
2018	15.678	15.047	-4.03	995
2017	14.911	15.678	5.15	1,219
2016	13.445	14.911	10.90	1,255
2015	13.862	13.445	-3.01	1,044
2014	13.602	13.862	1.91	1,050
2013	13.033	13.602	4.37	932
2012	11.544	13.033	12.90	852
2011	11.308	11.544	2.08	986
2010(8)	10.000	11.308	13.08	488
PIMCO VIT Low Duration
2019	9.734	9.976	2.48	38
2018	9.849	9.734	-1.17	74
2017	9.864	9.849	-0.15	21
2016	9.875	9.864	-0.11	28
2015(5)	10.000	9.875	-1.25	34
PIMCO VIT Total Return
2019	12.769	13.646	6.87	1,289
2018	13.020	12.769	-1.93	1,460
2017	12.584	13.020	3.47	1,777
2016	12.429	12.584	1.25	1,906
2015	12.552	12.429	-0.98	2,023
2014	12.206	12.552	2.83	2,159
2013	12.615	12.206	-3.24	2,345
2012	11.655	12.615	8.23	3,113
2011	11.390	11.655	2.33	2,029
2010	10.667	11.390	6.78	1,309
Rydex Commodities Strategy
2019	6.030	6.853	13.66	13
2018	7.206	6.030	-16.31	13
2017	6.997	7.206	2.98	8
2016	6.427	6.997	8.87	15
2015(5)	10.000	6.427	-35.73	6

Appendix I – Condensed Financial Information         202

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
T. Rowe Price Blue Chip Growth
2019	$31.886	$40.743	27.78%	508
2018	31.814	31.886	0.23	580
2017	23.751	31.814	33.95	615
2016	23.958	23.751	-0.86	616
2015	21.928	23.958	9.26	625
2014	20.431	21.928	7.33	488
2013	14.697	20.431	39.01	478
2012	12.622	14.697	16.44	487
2011	12.609	12.622	0.11	486
2010	11.007	12.609	14.56	453
T. Rowe Price Health Sciences
2019	54.073	68.588	26.84	353
2018	54.374	54.073	-0.55	430
2017	43.311	54.374	25.54	479
2016	49.193	43.311	-11.96	518
2015	44.356	49.193	10.90	640
2014	34.278	44.356	29.40	571
2013	23.075	34.278	48.55	497
2012	17.837	23.075	29.37	395
2011	16.362	17.837	9.02	328
2010	14.368	16.362	13.88	303
Van Eck Global Hard Assets
2019	7.667	8.434	10.00	327
2018	10.864	7.667	-29.42	359
2017	11.238	10.864	-3.33	382
2016	7.947	11.238	41.41	473
2015	12.142	7.947	-34.55	421
2014	15.267	12.142	-20.47	382
2013	14.024	15.267	8.86	362
2012	13.773	14.024	1.83	311
2011	16.741	13.773	-17.73	319
2010	13.174	16.741	27.08	190
Core Plus Bond
2019	24.040	26.030	8.28	2,132
2018	24.730	24.040	-2.79	2,210
2017	23.928	24.730	3.35	2,617
2016	23.312	23.928	2.64	2,856
2015	23.756	23.312	-1.87	3,144
2014	22.892	23.756	3.77	3,611
2013	23.396	22.892	-2.15	3,962
2012	22.029	23.396	6.20	4,098
2011	20.832	22.029	5.75	4,013
2010	18.892	20.832	10.27	4,398

Appendix I – Condensed Financial Information         203

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Diversified Balanced
2019	$15.525	$18.100	16.59%	49,326
2018	16.299	15.525	-4.75	55,941
2017	14.833	16.299	9.89	61,941
2016	14.072	14.833	5.41	66,153
2015	14.248	14.072	-1.24	65,359
2014	13.452	14.248	5.92	63,235
2013	12.066	13.452	11.49	56,392
2012	11.137	12.066	8.34	43,622
2011	10.883	11.137	2.33	27,478
2010(8)	10.000	10.883	8.83	14,593
Diversified Balanced Managed Volatility
2019	11.469	13.286	15.84	9941
2018	12.016	11.469	-4.56	10,584
2017	10.987	12.016	9.36	11,553
2016	10.470	10.987	4.94	11,817
2015	10.616	10.470	-1.38	10,272
2014	10.071	10.616	5.41	6,137
2013(9)	9.917	10.071	1.55	64
Diversified Growth
2019	16.984	20.298	19.51	173,335
2018	18.038	16.984	-5.84	190,741
2017	16.017	18.038	12.62	203,679
2016	15.019	16.017	6.64	208,330
2015	15.205	15.019	-1.22	197,094
2014	14.299	15.205	6.34	173,923
2013	12.281	14.299	16.43	140,583
2012	11.141	12.281	10.23	91,780
2011	11.031	11.141	1.00	62,385
2010(8)	10.000	11.031	10.31	27,443
Diversified Growth Managed Volatility
2019	11.821	14.009	18.51	20,288
2018	12.497	11.821	-5.41	22,485
2017	11.181	12.497	11.77	23,527
2016	10.542	11.181	6.06	23,324
2015	10.684	10.542	-1.33	19,518
2014	10.120	10.684	5.57	11,309
2013(9)	9.877	10.120	2.46	309
Diversified Income
2019	12.532	14.231	13.56	14,895
2018	13.019	12.532	-3.74	16,123
2017	12.133	13.019	7.30	18,612
2016	11.656	12.133	4.09	19,429
2015	11.801	11.656	-1.23	15,737
2014	11.196	11.801	5.40	12,955
2013	10.490	11.196	6.73	8,875
2012(10)	10.031	10.490	4.57	4,725

Appendix I – Condensed Financial Information         204

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Diversified International
2019	$27.297	$33.024	20.98%	909
2018	33.571	27.297	-18.69	1,075
2017	26.377	33.571	27.28	1,159
2016	26.654	26.377	-1.04	1,357
2015	27.126	26.654	-1.74	1,578
2014	28.421	27.126	-4.56	1,638
2013	24.244	28.421	17.23	1,643
2012	20.727	24.244	16.97	1,796
2011	23.552	20.727	-11.99	1,998
2010	20.974	23.552	12.29	2,035
Equity Income
2019	18.075	23.008	27.29	5,503
2018	19.298	18.075	-6.34	6,833
2017	16.163	19.298	19.40	7,537
2016	14.164	16.163	14.11	9,196
2015	14.951	14.164	-5.26	10,682
2014	13.442	14.951	11.23	12,022
2013	10.699	13.442	25.64	14,254
2012	9.586	10.699	11.61	16,532
2011	9.206	9.586	4.13	18,577
2010	8.024	9.206	14.73	12,283
Government & High Quality Bond
2019	12.059	12.658	4.97	2,411
2018	12.119	12.059	-0.50	2,641
2017	12.063	12.119	0.46	3,125
2016	12.016	12.063	0.39	3,531
2015	12.090	12.016	-0.61	3,740
2014	11.668	12.090	3.62	4,302
2013	11.945	11.668	-2.32	4,762
2012	11.640	11.945	2.62	5,088
2011	11.095	11.640	4.91	4,636
2010	10.614	11.095	4.53	5,005

Appendix I – Condensed Financial Information         205

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
International Emerging Markets
2019	$31.513	$36.545	15.97%	632
2018	40.467	31.513	-22.13	738
2017	29.137	40.467	38.89	822
2016	27.010	29.137	7.87	957
2015	31.779	27.010	-15.01	1,022
2014	33.482	31.779	-5.09	1,005
2013	35.580	33.482	-5.90	982
2012	29.825	35.580	19.29	945
2011	36.604	29.825	-18.52	952
2010	31.077	36.604	17.78	894
LargeCap Growth I
2019	78.278	104.142	33.04	298
2018	76.630	78.278	2.15	234
2017	58.115	76.630	31.86	262
2016	58.199	58.115	-0.14	293
2015	54.763	58.199	6.27	301
2014	51.131	54.763	7.10	295
2013	38.054	51.131	34.36	273
2012	33.112	38.054	14.93	255
2011	33.638	33.112	-1.56	252
2010	28.478	33.638	18.12	246
LargeCap S&P 500 Index
2019	19.884	25.706	29.28	1,707
2018	21.133	19.884	-5.91	1,933
2017	17.640	21.133	19.80	2,185
2016	16.031	17.640	10.04	2,223
2015	16.073	16.031	-0.26	2,337
2014	14.388	16.073	11.71	2,376
2013	11.040	14.388	30.33	2,290
2012	9.679	11.040	14.06	2,277
2011	9.634	9.679	0.47	2,574
2010	8.507	9.634	13.25	2,467

Appendix I – Condensed Financial Information         206

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
MidCap
2019	$101.411	$143.099	41.11%	716
2018	110.054	101.411	-7.85	896
2017	88.914	110.054	23.78	1,048
2016	81.697	88.914	8.83	1,213
2015	81.509	81.697	0.23	1,363
2014	73.158	81.509	11.42	1,558
2013	55.347	73.158	32.18	1,774
2012	46.923	55.347	17.95	1,963
2011	43.875	46.923	6.95	2,172
2010	35.797	43.875	22.57	2,193
Principal Capital Appreciation
2019	19.762	25.817	30.64	2,397
2018	20.750	19.762	-4.76	2,978
2017	17.425	20.750	19.08	3,542
2016	16.196	17.425	7.59	4,164
2015	16.074	16.196	0.76	4,591
2014	14.495	16.074	10.89	935
2013	11.072	14.495	30.92	935
2012	9.850	11.072	12.40	842
2011	9.960	9.850	-1.11	733
2010	8.740	9.960	13.96	558
Principal LifeTime 2010
2019	16.127	18.145	12.51	774
2018	17.015	16.127	-5.22	917
2017	15.485	17.015	9.88	1,234
2016	14.920	15.485	3.79	1,510
2015	15.310	14.920	-2.55	1,667
2014	14.814	15.310	3.35	1,880
2013	13.542	14.814	9.39	1,993
2012	12.266	13.542	10.40	2,148
2011	12.243	12.266	0.19	2,309
2010	10.881	12.243	12.52	2,473
Principal LifeTime 2020
2019	18.097	21.079	16.48	3,426
2018	19.401	18.097	-6.72	4,097
2017	17.106	19.401	13.41	4,823
2016	16.403	17.106	4.29	5,598
2015	16.825	16.403	-2.51	6,191
2014	16.135	16.825	4.28	6,965
2013	14.091	16.135	14.51	8,239
2012	12.434	14.091	13.32	8,852
2011	12.726	12.434	-2.30	9,541
2010	11.200	12.726	13.63	10,091

Appendix I – Condensed Financial Information         207

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Principal LifeTime 2030
2019	$18.402	$22.140	20.31%	2,279
2018	20.082	18.402	-8.36	2,726
2017	17.220	20.082	16.62	3,143
2016	16.495	17.220	4.40	3,078
2015	16.906	16.495	-2.43	3,327
2014	16.165	16.906	4.58	3,371
2013	13.761	16.165	17.47	3,454
2012	12.057	13.761	14.13	3,594
2011	12.485	12.057	-3.43	3,660
2010	10.955	12.485	13.97	3,740
Principal LifeTime 2040
2019	19.337	23.786	23.01	550
2018	21.281	19.337	-9.14	601
2017	17.883	21.281	19.00	636
2016	17.197	17.883	3.99	683
2015	17.589	17.197	-2.23	686
2014	16.795	17.589	4.73	706
2013	13.892	16.795	20.90	630
2012	12.053	13.892	15.26	676
2011	12.606	12.053	-4.39	689
2010	11.022	12.606	14.37	672
Principal LifeTime 2050
2019	19.550	24.365	24.63	413
2018	21.703	19.550	-9.92	465
2017	18.019	21.703	20.44	467
2016	17.308	18.019	4.11	466
2015	17.674	17.308	-2.07	462
2014	16.876	17.674	4.73	406
2013	13.811	16.876	22.19	373
2012	11.946	13.811	15.61	360
2011	12.593	11.946	-5.13	323
2010	10.973	12.593	14.76	327
Principal LifeTime Strategic Income
2019	14.513	16.094	10.89	525
2018	15.175	14.513	-4.36	627
2017	14.149	15.175	7.25	796
2016	13.694	14.149	3.32	859
2015	14.021	13.694	-2.33	954
2014	13.597	14.021	3.12	1100
2013	13.105	13.597	3.75	1263
2012	12.102	13.105	8.28	1405
2011	11.837	12.102	2.24	1475
2010	10.775	11.837	9.86	1505

Appendix I – Condensed Financial Information         208

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Real Estate Securities
2019	$56.622	$73.290	29.44%	429
2018	59.952	56.622	-5.55	498
2017	55.676	59.952	7.68	568
2016	53.342	55.676	4.38	608
2015	51.911	53.342	2.76	629
2014	39.634	51.911	30.98	618
2013	38.577	39.634	2.74	590
2012	33.340	38.577	15.71	518
2011	30.990	33.340	7.58	480
2010	24.962	30.990	24.15	431
SAM Balanced
2019	15.367	18.184	18.33	20,263
2018	16.412	15.367	-6.37	24,322
2017	14.446	16.412	13.61	28,051
2016	13.714	14.446	5.34	31,221
2015	14.021	13.714	-2.19	35,357
2014	13.311	14.021	5.33	39,321
2013	11.457	13.311	16.18	46,819
2012	10.289	11.457	11.35	50,915
2011	10.317	10.289	-0.27	53,610
2010	9.195	10.317	12.20	55,182
SAM Conservative Balanced
2019	14.889	17.014	14.27	5,198
2018	15.646	14.889	-4.84	5,865
2017	14.235	15.646	9.91	6,855
2016	13.571	14.235	4.89	8,005
2015	13.871	13.571	-2.16	8,556
2014	13.243	13.871	4.74	9,316
2013	12.029	13.243	10.09	10,333
2012	10.955	12.029	9.81	10,099
2011	10.844	10.955	1.03	10,213
2010	9.818	10.844	10.45	10,654
SAM Conservative Growth
2019	15.369	18.801	22.33	3,689
2018	16.692	15.369	-7.93	4,300
2017	14.131	16.692	18.12	4,866
2016	13.393	14.131	5.51	5,237
2015	13.732	13.393	-2.47	5,287
2014	12.963	13.732	5.93	4,956
2013	10.668	12.963	21.51	4,368
2012	9.461	10.668	12.75	3,903
2011	9.623	9.461	-1.68	3,570
2010	8.457	9.623	13.79	3,116

Appendix I – Condensed Financial Information         209

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
SAM Flexible Income
2019	$14.822	$16.553	11.68%	5,488
2018	15.334	14.822	-3.34	6,252
2017	14.344	15.334	6.90	7,644
2016	13.589	14.344	5.56	8,127
2015	13.963	13.589	-2.68	8,843
2014	13.355	13.963	4.55	9,081
2013	12.556	13.355	6.36	9,299
2012	11.493	12.556	9.25	9,859
2011	11.256	11.493	2.10	9,389
2010	10.313	11.256	9.14	9,408
SAM Strategic Growth
2019	15.149	19.039	25.68	1,982
2018	16.810	15.149	-9.88	2,406
2017	13.947	16.810	20.53	2,754
2016	13.324	13.947	4.68	3,160
2015	13.735	13.324	-2.99	3,257
2014	12.816	13.735	7.17	2,955
2013	10.188	12.816	25.80	2,552
2012	8.930	10.188	14.08	2,361
2011	9.217	8.930	-3.11	2,460
2010	8.018	9.217	14.96	2,231
Short-Term Income
2019	11.666	12.045	3.25	4,546
2018	11.712	11.666	-0.39	5,167
2017	11.600	11.712	0.97	5,958
2016	11.518	11.600	0.71	6,744
2015	11.598	11.518	-0.69	7,371
2014	11.561	11.598	0.32	8,558
2013	11.582	11.561	-0.18	9,294
2012	11.170	11.582	3.69	9,441
2011	11.158	11.170	0.11	8,893
2010	10.843	11.158	2.90	8,687
SmallCap
2019	23.083	28.999	25.63	1,259
2018	26.272	23.083	-12.14	1,488
2017	23.604	26.272	11.30	1,671
2016	20.391	23.604	15.76	1,919
2015	20.699	20.391	-1.49	2,210
2014	20.012	20.699	3.43	165
2013(1)	16.337	20.012	22.49	40

Appendix I – Condensed Financial Information         210

For Contracts Without the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
TOPS Aggressive Growth ETF
2019	$8.621	$10.547	22.34%	1
2018(11)	10.000	8.621	-13.79	-
TOPS Balanced ETF
2019	9.287	10.603	14.17	-
2018(11)	10.000	9.287	-7.13	-
TOPS Conservative ETF
2019	9.617	10.560	9.81	-
2018(11)	10.000	9.617	-3.83	-
TOPS Growth ETF
2019	8.811	10.575	20.02	1
2018(11)	10.000	8.811	-11.89	-
TOPS Moderate Growth ETF
2019	9.124	10.664	16.88	1
2018(11)	10.000	9.124	-8.76	-

⁽¹⁾ Commenced Operations on May 18, 2013

⁽²⁾ Commenced Operations on April 25, 2014

⁽³⁾ Commenced Operations on May 22, 2010

⁽⁴⁾ Commenced Operations on May 21, 2016

⁽⁵⁾ Commenced Operations on May 16, 2015

⁽⁶⁾ Commenced Operations on June 8, 2019

⁽⁷⁾ Commenced Operations on April 8, 2016

⁽⁸⁾ Commenced Operations on January 4, 2010

⁽⁹⁾ Commenced Operations on October 31, 2013

⁽¹⁰⁾ Commenced Operations on May 15, 2012

⁽¹¹⁾ Commenced Operations on June 11, 2018

Appendix I – Condensed Financial Information         211

The following table contains the unit values for the Contract with the Premium Payment Credit Rider for the periods ended December 31.

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
AllianceBernstein Small Cap Growth
2019	$31.246	$41.777	33.70%	3
2018	32.168	31.246	-2.87	13
2017	24.467	32.168	31.48	15
2016	23.446	24.467	4.35	17
2015	24.222	23.446	-3.20	22
2014	25.169	24.222	-3.76	36
2013	17.612	25.169	42.91	61
2012	15.599	17.612	12.90	63
2011	15.211	15.599	2.55	90
2010	11.318	15.211	34.40	66
AllianceBernstein Small/Mid Cap Value
2019	12.718	14.972	17.72	49
2018	15.272	12.718	-16.72	47
2017	13.769	15.272	10.92	64
2016	11.230	13.769	22.61	66
2015	12.122	11.230	-7.36	38
2014	11.325	12.122	7.04	37
2013(1)	10.000	11.325	13.25	20
American Century VP Capital Appreciation
2019	12.059	16.024	32.88	-
2018	12.978	12.059	-7.08	2
2017	10.871	12.978	19.38	21
2016	10.743	10.871	1.19	20
2015	10.753	10.743	-0.09	19
2014(2)	10.000	10.753	7.53	42
American Century VP Inflation Protection
2019	11.664	12.451	6.75	3
2018	12.246	11.664	-4.75	13
2017	12.051	12.246	1.62	23
2016	11.777	12.051	2.33	54
2015	12.319	11.777	-4.40	191
2014	12.167	12.319	1.25	498
2013	13.551	12.167	-10.21	1,108
2012	12.856	13.551	5.40	1,356
2011	11.719	12.856	9.70	1,358
2010	11.358	11.719	3.18	1,634

Appendix I – Condensed Financial Information         212

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
American Century VP Mid Cap Value
2019	$20.121	$25.441	26.44%	36
2018	23.587	20.121	-14.70	38
2017	21.587	23.587	9.27	52
2016	17.946	21.587	20.29	55
2015	18.602	17.946	-3.53	47
2014	16.327	18.602	13.93	36
2013	12.811	16.327	27.45	32
2012	11.230	12.811	14.08	18
2011	11.536	11.230	-2.66	16
2010(3)	10.000	11.536	15.36	7
American Century VP Ultra
2019	23.518	30.996	31.80	20
2018	23.853	23.518	-1.41	24
2017	18.434	23.853	29.40	38
2016	18.022	18.434	2.29	37
2015	17.337	18.022	3.95	116
2014	16.104	17.337	7.66	290
2013	11.989	16.104	34.32	634
2012	10.734	11.989	11.69	1,078
2011	10.841	10.734	-0.98	1,252
2010	9.535	10.841	13.70	1,324
American Funds Asset Allocation
2019	11.297	13.425	18.84	71
2018	12.083	11.297	-6.50	71
2017	10.605	12.083	13.94	35
2016(4)	10.000	10.605	6.05	27
American Funds Blue Chip Income and Growth
2019	11.440	13.610	18.97	63
2018	12.778	11.440	-10.47	62
2017	11.138	12.778	14.73	52
2016(4)	10.000	11.138	11.38	30
American Funds Global Small Capitalization
2019	9.426	12.152	28.92	12
2018	10.752	9.426	-12.33	11
2017	8.712	10.752	23.41	8
2016	8.706	8.712	0.07	8
2015(5)	10.000	8.706	-12.94	-
American Funds New World
2019	9.809	12.417	26.58	7
2018	11.643	9.809	-15.75	7
2017	9.175	11.643	26.89	18
2016	8.893	9.175	3.17	13
2015(5)	10.000	8.893	-11.07	-

Appendix I – Condensed Financial Information         213

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
BlackRock Global Allocation VI
2019	$9.506	$10.972	15.43%	22
2018	10.495	9.506	-9.42	24
2017	9.415	10.495	11.47	5
2016	9.253	9.415	1.75	4
2015(5)	10.000	9.253	-7.47	1
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)
2019	9.895	11.758	18.83	5
2018	10.648	9.895	-7.07	5
2017	9.469	10.648	12.45	6
2016	9.099	9.469	4.07	6
2015(5)	10.000	9.099	-9.01	4
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)
2019	30.389	37.387	23.03	23
2018	31.405	30.389	-3.24	29
2017	22.504	31.405	39.55	52
2016	21.995	22.504	2.31	56
2015	21.186	21.995	3.82	43
2014	20.280	21.186	4.47	48
2013	15.602	20.280	29.98	48
2012	13.780	15.602	13.22	45
2011	15.264	13.780	-9.72	46
2010	11.993	15.264	27.27	41
Columbia Limited Duration Credit
2019	9.612	10.126	5.34	3
2018	9.809	9.612	-2.00	1
2017	9.829	9.809	-0.20	1
2016	9.525	9.829	3.19	1
2015(5)	10.000	9.525	-4.75	1
Delaware VIP Limited Term Diversified Income
2019	9.597	9.859	2.73	1
2018	9.788	9.597	-1.96	2
2017	9.797	9.788	-0.09	1
2016	9.825	9.797	-0.28	1
2015(5)	10.000	9.825	-1.75	1
Delaware VIP Small Cap Value
2019	12.345	15.454	25.19	21
2018	15.165	12.345	-18.60	24
2017	13.843	15.165	9.55	40
2016	10.774	13.843	28.49	31
2015	11.751	10.774	-8.31	23
2014	11.350	11.751	3.53	12
2013(1)	10.000	11.350	13.50	7

Appendix I – Condensed Financial Information         214

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
DWS Small Mid Cap Value
2019	$11.318	$13.422	18.59%	9
2018	13.801	11.318	-17.99	9
2017	12.783	13.801	7.96	9
2016	11.197	12.783	14.16	9
2015	11.682	11.197	-4.15	11
2014	11.341	11.682	3.01	10
2013(1)	10.000	11.341	13.41	4
EQ Advisors Trust 1290 VT Convertible Securities Portfolio
2019(6)	10.000	10.851	8.51%	-
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio
2019(6)	10.000	10.797	7.97%	-
EQ Advisors Trust 1290 VT Micro Cap Portfolio
2019(6)	10.000	10.861	8.61%	-
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio
2019(6)	10.000	10.780	7.8%	-
EQ Advisors Trust 1290 VT Socially Responsible Portfolio
2019(6)	10.000	11.165	11.65%	-
Fidelity VIP Contrafund®
2019	24.366	31.353	28.68	44
2018	26.630	24.366	-8.50	58
2017	22.343	26.630	19.19	92
2016	21.158	22.343	5.60	116
2015	21.497	21.158	-1.58	176
2014	19.642	21.497	9.44	286
2013	15.289	19.642	28.47	454
2012	13.411	15.289	14.00	573
2011	14.052	13.411	-4.56	637
2010	12.242	14.052	14.79	646
Fidelity VIP Equity-Income
2019	17.677	22.024	24.59	28
2018	19.720	17.677	-10.36	44
2017	17.858	19.720	10.43	52
2016	15.478	17.858	15.38	64
2015	16.489	15.478	-6.13	82
2014	15.508	16.489	6.33	114
2013	12.366	15.508	25.41	150
2012	10.762	12.366	14.90	178
2011	10.892	10.762	-1.19	184
2010	9.655	10.892	12.81	170

Appendix I – Condensed Financial Information         215

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Fidelity VIP Government Money Market
2019	$9.676	$9.676	0.00%	217
2018	9.713	9.676	-0.38	604
2017	9.840	9.713	-1.29	82
2016(7)	10.000	9.840	-1.60	157
Fidelity VIP Growth
2019	24.864	32.652	31.32	36
2018	25.479	24.864	-2.42	39
2017	19.280	25.479	32.15	41
2016	19.561	19.280	-1.44	41
2015	18.668	19.561	4.78	56
2014	17.155	18.668	8.82	97
2013	12.858	17.155	33.42	131
2012	11.450	12.858	12.29	161
2011	11.667	11.450	-1.86	181
2010	9.595	11.667	21.59	200
Fidelity VIP Mid Cap
2019	25.444	30.719	20.73	72
2018	30.461	25.444	-16.47	80
2017	25.780	30.461	18.16	88
2016	23.499	25.780	9.71	75
2015	24.371	23.499	-3.58	80
2014	23.449	24.371	3.93	88
2013	17.591	23.449	33.30	98
2012	15.643	17.591	12.45	108
2011	17.875	15.643	-12.48	137
2010	14.162	17.875	26.22	135
Fidelity VIP Overseas
2019	15.073	18.838	24.98	19
2018	18.106	15.073	-16.75	25
2017	14.209	18.106	27.43	39
2016	15.303	14.209	-7.15	50
2015	15.114	15.303	1.25	138
2014	16.814	15.114	-10.11	347
2013	13.158	16.814	27.79	590
2012	11.124	13.158	18.28	838
2011	13.699	11.124	-18.80	954
2010	12.356	13.699	10.87	918

Appendix I – Condensed Financial Information         216

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Franklin Global Real Estate VIP
2019	$9.299	$11.155	19.96%	-
2018	10.178	9.299	-8.63	-
2017	9.398	10.178	8.30	2
2016	9.537	9.398	-1.46	3
2015(5)	10.000	9.537	-4.63	1
Franklin Small Cap Value VIP
2019	19.537	24.195	23.84	19
2018	22.880	19.537	-14.61	23
2017	21.094	22.880	8.47	33
2016	16.530	21.094	27.61	34
2015	18.209	16.530	-9.22	28
2014	18.471	18.209	-1.42	21
2013	13.820	18.471	33.65	24
2012	11.892	13.820	16.21	21
2011	12.587	11.892	-5.52	20
2010(8)	10.000	12.587	25.87	8
Franklin Templeton Global Bond VIP
2019	9.381	9.366	-0.16	1
2018	9.394	9.381	-0.13	1
2017	9.417	9.394	-0.25	1
2016	9.340	9.417	0.82	1
2015(5)	10.000	9.340	-6.60	1
Goldman Sachs VIT Mid Cap Value
2019	21.589	27.833	28.92	22
2018	24.600	21.589	-12.24	24
2017	22.595	24.600	8.87	26
2016	20.304	22.595	11.28	28
2015	22.824	20.304	-11.04	46
2014	20.502	22.824	11.33	104
2013	15.725	20.502	30.38	214
2012	13.523	15.725	16.29	279
2011	14.713	13.523	-8.09	319
2010	11.990	14.713	22.71	338
Goldman Sachs VIT Small Cap Equity Insights
2019	19.568	23.946	22.37	14
2018	21.850	19.568	-10.44	16
2017	19.979	21.850	9.36	16
2016	16.544	19.979	20.76	18
2015	17.245	16.544	-4.06	21
2014	16.454	17.245	4.81	35
2013	12.366	16.454	33.06	96
2012	11.166	12.366	10.75	111
2011	11.297	11.166	-1.16	117
2010	8.844	11.297	27.74	121

Appendix I – Condensed Financial Information         217

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Guggenheim Floating Rate Strategies Series F
2019	$10.154	$10.710	5.47%	3
2018	10.444	10.154	-2.78	18
2017	10.298	10.444	1.42	2
2016	9.677	10.298	6.42	5
2015(5)	10.000	9.677	-3.23	2
Guggenheim Global Managed Futures Strategy
2019	7.633	8.091	6.00	-
2018	8.561	7.633	-10.84	1
2017	8.034	8.561	6.56	1
2016	9.616	8.034	-16.45	1
2015(5)	10.000	9.616	-3.84	-
Guggenheim Long Short Equity Fund
2019	9.329	9.651	3.45	-
2018	10.933	9.329	-14.67	-
2017	9.711	10.933	12.58	-
2016	9.843	9.711	-1.34	-
2015(5)	10.000	9.843	-1.57	-
Guggenheim Multi-Hedge Strategies
2019	9.183	9.453	2.94	2
2018	9.871	9.183	-6.97	2
2017	9.713	9.871	1.62	2
2016	9.957	9.713	-2.45	2
2015(5)	10.000	9.957	-0.43	-
Invesco Global Health Care
2019	10.917	14.179	29.88	3
2018	11.039	10.917	-1.10	4
2017	9.723	11.039	13.54	4
2016(4)	10.000	9.723	-2.77	3
Invesco V.I. International Growth
2019	10.012	12.617	26.02	43
2018	12.014	10.012	-16.67	50
2017	9.964	12.014	20.58	59
2016	10.212	9.964	-2.43	75
2015	10.668	10.212	-4.27	84
2014	10.848	10.668	-1.66	90
2013	9.282	10.848	16.87	71
2012	8.174	9.282	13.55	74
2011	8.904	8.174	-8.20	78
2010	8.036	8.904	10.80	57

Appendix I – Condensed Financial Information         218

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Invesco V.I. SmallCap Equity
2019	$20.452	$25.380	24.09%	24
2018	24.574	20.452	-16.77	25
2017	21.979	24.574	11.81	30
2016	20.009	21.979	9.85	31
2015	21.606	20.009	-7.39	31
2014	21.534	21.606	0.33	41
2013	15.968	21.534	34.86	52
2012	14.283	15.968	11.79	53
2011	14.655	14.283	-2.54	57
2010	11.614	14.655	26.18	48
Invesco V.I. Value Opportunities
2019	13.089	16.758	28.03	7
2018	16.524	13.089	-20.79	9
2017	14.354	16.524	15.12	23
2016	12.375	14.354	15.99	28
2015	14.091	12.375	-12.18	39
2014	13.484	14.091	4.50	55
2013	10.275	13.484	31.23	77
2012	8.894	10.275	15.53	76
2011	9.344	8.894	-4.82	87
2010	8.867	9.344	5.38	82
Janus Flexible Bond
2019	9.661	10.348	7.11	13
2018	9.985	9.661	-3.25	13
2017	9.856	9.985	1.31	1
2016(4)	10.000	9.856	-1.44	-
MFS International Intrinsic Value (f.k.a. MFS International Value)
2019	10.575	13.025	23.17	8
2018	11.952	10.575	-11.52	9
2017	9.614	11.952	24.32	8
2016	9.446	9.614	1.78	7
2015(5)	10.000	9.446	-5.54	4
MFS New Discovery
2019	13.045	18.065	38.48	13
2018	13.543	13.045	-3.68	13
2017	10.936	13.543	23.84	12
2016	10.254	10.936	6.65	9
2015	10.691	10.254	-4.09	11
2014	11.791	10.691	-9.33	10
2013(1)	10.000	11.791	17.91	10

Appendix I – Condensed Financial Information         219

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
MFS Utilities
2019	$22.071	$26.999	22.33%	29
2018	22.338	22.071	-1.20	46
2017	19.903	22.338	12.24	43
2016	18.254	19.903	9.03	47
2015	21.848	18.254	-16.45	54
2014	19.818	21.848	10.24	79
2013	16.804	19.818	17.94	68
2012	15.121	16.804	11.13	52
2011	14.462	15.121	4.56	34
2010	12.979	14.462	11.43	27
MFS Value
2019	23.096	29.318	26.94	10
2018	26.287	23.096	-12.14	15
2017	22.852	26.287	15.03	19
2016	20.491	22.852	11.52	32
2015	21.102	20.491	-2.90	35
2014	19.535	21.102	8.02	38
2013	14.685	19.535	33.03	39
2012	12.910	14.685	13.75	31
2011	13.212	12.910	-2.28	17
2010	12.102	13.212	9.17	10
Neuberger Berman AMT Mid Cap Growth
2019	10.941	14.208	29.86	2
2018	11.947	10.941	-8.42	3
2017	9.784	11.947	22.11	6
2016	9.583	9.784	2.10	10
2015(5)	10.000	9.583	-4.17	22
Neuberger Berman AMT Socially Responsive
2019	22.379	27.614	23.39	14
2018	24.221	22.379	-7.60	2
2017	20.864	24.221	16.09	10
2016	19.374	20.864	7.69	15
2015	19.858	19.374	-2.44	25
2014	18.354	19.858	8.19	44
2013	13.596	18.354	35.00	72
2012	12.480	13.596	8.94	86
2011	13.117	12.480	-4.85	94
2010	10.876	13.117	20.61	97

Appendix I – Condensed Financial Information         220

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
PIMCO VIT All Asset
2019	$14.166	$15.538	9.68%	10
2018	15.280	14.166	-7.29	13
2017	13.729	15.280	11.30	20
2016	12.403	13.729	10.69	22
2015	13.903	12.403	-10.79	25
2014	14.117	13.903	-1.52	38
2013	14.350	14.117	-1.62	54
2012	12.719	14.350	12.82	59
2011	12.707	12.719	0.09	31
2010	11.446	12.707	11.02	81
PIMCO VIT High Yield Portfolio
2019	14.255	16.034	12.48	44
2018	14.943	14.255	-4.60	50
2017	14.297	14.943	4.52	62
2016	12.969	14.297	10.24	130
2015	13.452	12.969	-3.59	67
2014	13.279	13.452	1.30	108
2013	12.800	13.279	3.74	116
2012	11.406	12.800	12.23	274
2011	11.241	11.406	1.47	353
2010(8)	10.000	11.241	12.41	226
PIMCO VIT Low Duration
2019	9.524	9.702	1.87	-
2018	9.695	9.524	-1.76	-
2017	9.768	9.695	-0.75	-
2016	9.838	9.768	-0.71	-
2015(5)	10.000	9.838	-1.62	-
PIMCO VIT Total Return
2019	12.052	12.802	6.22	46
2018	12.363	12.052	-2.52	68
2017	12.021	12.363	2.85	145
2016	11.944	12.021	0.64	123
2015	12.135	11.944	-1.57	116
2014	11.871	12.135	2.22	168
2013	12.343	11.871	-3.82	211
2012	11.473	12.343	7.58	505
2011	11.279	11.473	1.72	263
2010	10.627	11.279	6.14	151
Rydex Commodities Strategy
2019	5.900	6.665	12.97	9
2018	7.093	5.900	-16.82	10
2017	6.929	7.093	2.36	12
2016	6.403	6.929	8.21	2
2015(5)	10.000	6.403	-35.97	-

Appendix I – Condensed Financial Information         221

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
T. Rowe Price Blue Chip Growth
2019	$29.252	$37.154	27.01%	66
2018	29.362	29.252	-0.37	84
2017	22.052	29.362	33.15	70
2016	22.378	22.052	-1.46	85
2015	20.605	22.378	8.60	90
2014	19.314	20.605	6.68	93
2013	13.977	19.314	38.18	88
2012	12.077	13.977	15.73	80
2011	12.137	12.077	-0.50	76
2010	10.658	12.137	13.88	82
T. Rowe Price Health Sciences
2019	49.606	62.545	26.08	31
2018	50.184	49.606	-1.15	36
2017	40.214	50.184	24.79	45
2016	45.950	40.214	-12.48	62
2015	41.681	45.950	10.24	86
2014	32.404	41.681	28.63	114
2013	21.945	32.404	47.66	135
2012	17.066	21.945	28.59	120
2011	15.748	17.066	8.37	110
2010	13.913	15.748	13.19	93
Van Eck Global Hard Assets
2019	7.236	7.912	9.34	39
2018	10.315	7.236	-29.85	46
2017	10.735	10.315	-3.91	62
2016	7.636	10.735	40.58	66
2015	11.738	7.636	-34.95	80
2014	14.848	11.738	-20.95	71
2013	13.722	14.848	8.21	70
2012	13.558	13.722	1.21	65
2011	16.579	13.558	-18.22	62
2010	13.124	16.579	26.33	50
Core Plus Bond
2019	21.564	23.210	7.64	173
2018	22.318	21.564	-3.38	155
2017	21.724	22.318	2.74	195
2016	21.292	21.724	2.03	200
2015	21.828	21.292	-2.46	307
2014	21.161	21.828	3.15	502
2013	21.756	21.161	-2.73	934
2012	20.610	21.756	5.56	1,225
2011	19.606	20.610	5.12	1,242
2010	17.888	19.606	9.60	1,340

Appendix I – Condensed Financial Information         222

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Diversified Balanced
2019	$14.709	$17.046	15.89%	3,454
2018	15.536	14.709	-5.32	4,518
2017	14.223	15.536	9.23	5,732
2016	13.574	14.223	4.78	6,172
2015	13.827	13.574	-1.83	5,932
2014	13.133	13.827	5.28	5,558
2013	11.850	13.133	10.83	4,998
2012	11.004	11.850	7.69	3,694
2011	10.818	11.004	1.72	2,245
2010(8)	10.000	10.818	8.18	1,008
Diversified Balanced Managed Volatility
2019	11.121	12.806	15.15	864
2018	11.722	11.121	-5.13	925
2017	10.783	11.722	8.71	961
2016	10.337	10.783	4.31	977
2015	10.545	10.337	-1.97	633
2014	10.064	10.545	4.78	392
2013(9)	9.919	10.064	1.46	‑
Diversified Growth
2019	16.091	19.116	18.80	8,017
2018	17.193	16.091	-6.41	10,719
2017	15.358	17.193	11.95	13,126
2016	14.488	15.358	6.00	14,084
2015	14.755	14.488	-1.81	14,229
2014	13.960	14.755	5.69	13,505
2013	12.062	13.960	15.74	11,106
2012	11.008	12.062	9.57	7,150
2011	10.965	11.008	0.39	4,756
2010(8)	10.000	10.965	9.65	1,931
Diversified Growth Managed Volatility
2019	11.463	13.503	17.80	1,697
2018	12.192	11.463	-5.98	1,954
2017	10.974	12.192	11.10	2,036
2016	10.408	10.974	5.44	2,187
2015	10.612	10.408	-1.92	1,831
2014	10.113	10.612	4.93	1,003
2013(9)	9.880	10.113	2.36	26
Diversified Income
2019	12.044	13.595	12.88	663
2018	12.587	12.044	-4.32	918
2017	11.801	12.587	6.66	853
2016	11.405	11.801	3.47	918
2015	11.617	11.405	-1.82	745
2014	11.088	11.617	4.77	744
2013	10.451	11.088	6.10	668
2012(10)	10.034	10.451	4.16	406

Appendix I – Condensed Financial Information         223

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Diversified International
2019	$24.485	$29.446	20.26%	24
2018	30.296	24.485	-19.18	27
2017	23.947	30.296	26.51	55
2016	24.343	23.947	-1.63	88
2015	24.923	24.343	-2.33	134
2014	26.271	24.923	-5.13	264
2013	22.544	26.271	16.53	446
2012	19.391	22.544	16.26	561
2011	22.166	19.391	-12.52	626
2010	19.858	22.166	11.62	655
Equity Income
2019	16.819	21.282	26.53	126
2018	18.067	16.819	-6.91	177
2017	15.222	18.067	18.69	163
2016	13.420	15.222	13.43	221
2015	14.251	13.420	-5.83	614
2014	12.889	14.251	10.57	1,481
2013	10.321	12.889	24.88	3,117
2012	9.303	10.321	10.94	4,601
2011	8.988	9.303	3.51	5,277
2010	7.881	8.988	14.05	3,426
Government & High Quality Bond
2019	11.349	11.842	4.34	232
2018	11.474	11.349	-1.09	265
2017	11.490	11.474	-0.14	323
2016	11.515	11.490	-0.22	370
2015	11.655	11.515	-1.20	445
2014	11.315	11.655	3.00	646
2013	11.654	11.315	-2.91	1,048
2012	11.425	11.654	2.00	1,418
2011	10.956	11.425	4.28	1,176
2010	10.544	10.956	3.91	1,182

Appendix I – Condensed Financial Information         224

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
International Emerging Markets
2019	$28.267	$32.585	-58.11%	20
2018	36.520	28.267	-72.07	24
2017	26.452	36.520	38.06	40
2016	24.668	26.452	7.23	52
2015	29.199	24.668	-15.52	88
2014	30.949	29.199	-5.65	167
2013	33.086	30.949	-6.46	254
2012	27.903	33.086	18.58	279
2011	34.450	27.903	-19.01	305
2010	29.424	34.450	17.08	316
LargeCap Growth I
2019	70.216	92.857	32.24	20
2018	69.154	70.216	1.54	18
2017	52.759	69.154	31.07	20
2016	53.154	52.759	-0.74	21
2015	50.316	53.154	5.64	26
2014	47.262	50.316	6.46	38
2013	35.386	47.262	33.56	63
2012	30.977	35.386	14.23	76
2011	31.658	30.977	-2.15	84
2010	26.962	31.658	17.42	88
LargeCap S&P 500 Index
2019	30.861	22.921	-25.73	125
2018	19.072	30.861	61.81	170
2017	16.015	19.072	19.09	193
2016	14.641	16.015	9.38	211
2015	14.769	14.641	-0.87	224
2014	13.300	14.769	11.05	341
2013	10.266	13.300	29.55	508
2012	9.055	10.266	13.38	620
2011	9.067	9.055	-0.13	680
2010	8.055	9.067	12.56	651

Appendix I – Condensed Financial Information         225

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
MidCap
2019	$90.968	$127.596	40.26%	20
2018	99.319	90.968	-8.41	33
2017	80.722	99.319	23.04	48
2016	74.616	80.722	8.18	65
2015	74.893	74.616	-0.37	117
2014	67.624	74.893	10.75	220
2013	51.468	67.624	31.39	391
2012	43.898	51.468	17.24	535
2011	41.293	43.898	6.31	617
2010	33.894	41.293	21.83	685
Principal Capital Appreciation
2019	18.424	23.926	29.86	124
2018	19.462	18.424	-5.33	153
2017	16.442	19.462	18.37	191
2016	15.374	16.442	6.95	232
2015	15.350	15.374	0.16	424
2014	13.926	15.350	10.23	223
2013	10.701	13.926	30.14	231
2012	9.577	10.701	11.73	191
2011	9.743	9.577	-1.70	195
2010	8.600	9.743	13.29	188
Principal LifeTime 2010
2019	14.797	16.549	11.84	21
2018	15.706	14.797	-5.79	32
2017	14.380	15.706	9.22	52
2016	13.938	14.380	3.17	56
2015	14.389	13.938	-3.13	66
2014	14.006	14.389	2.73	104
2013	12.881	14.006	8.73	231
2012	11.738	12.881	9.73	415
2011	11.786	11.738	-0.41	463
2010	10.538	11.786	11.84	485
Principal LifeTime 2020
2019	16.605	19.225	15.78	79
2018	17.908	16.605	-7.28	95
2017	15.885	17.908	12.74	157
2016	15.324	15.885	3.66	201
2015	15.813	15.324	-3.09	474
2014	15.255	15.813	3.66	1,048
2013	13.403	15.255	13.82	2,104
2012	11.898	13.403	12.65	2,788
2011	12.251	11.898	-2.88	2,986
2010	10.847	12.251	12.94	3,134

Appendix I – Condensed Financial Information         226

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Principal LifeTime 2030
2019	$16.885	$20.193	19.59%	49
2018	18.538	16.885	-8.92	62
2017	15.991	18.538	15.92	94
2016	15.410	15.991	3.77	511
2015	15.889	15.410	-3.01	614
2014	15.284	15.889	3.96	707
2013	13.089	15.284	16.77	739
2012	11.537	13.089	13.45	781
2011	12.019	11.537	-4.01	911
2010	10.610	12.019	13.28	999
Principal LifeTime 2040
2019	17.742	21.694	22.27	19
2018	19.645	17.742	-9.69	27
2017	16.606	19.645	18.30	34
2016	16.066	16.606	3.36	35
2015	16.531	16.066	-2.81	51
2014	15.879	16.531	4.11	70
2013	13.214	15.879	20.17	106
2012	11.534	13.214	14.56	132
2011	12.135	11.534	-4.95	145
2010	10.674	12.135	13.69	156
Principal LifeTime 2050
2019	17.937	22.222	23.89	4
2018	20.033	17.937	-10.46	14
2017	16.733	20.033	19.72	23
2016	16.169	16.733	3.49	26
2015	16.611	16.169	-2.66	34
2014	15.956	16.611	4.11	55
2013	13.136	15.956	21.47	76
2012	11.432	13.136	14.91	92
2011	12.123	11.432	-5.70	113
2010	10.627	12.123	14.08	108
Principal LifeTime Strategic Income
2019	13.316	14.678	10.23	23
2018	14.007	13.316	-4.93	29
2017	13.139	14.007	6.61	45
2016	12.793	13.139	2.70	95
2015	13.177	12.793	-2.91	104
2014	12.856	13.177	2.50	150
2013	12.465	12.856	3.14	217
2012	11.581	12.465	7.63	237
2011	11.396	11.581	1.63	240
2010	10.436	11.396	9.20	255

Appendix I – Condensed Financial Information         227

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
Real Estate Securities
2019	$50.792	$65.350	28.66%	46
2018	54.104	50.792	-6.12	65
2017	50.547	54.104	7.04	83
2016	48.719	50.547	3.75	94
2015	47.697	48.719	2.14	105
2014	36.636	47.697	30.19	137
2013	35.874	36.636	2.12	160
2012	31.190	35.874	15.02	167
2011	29.166	31.190	6.94	161
2010	23.634	29.166	23.41	156
SAM Balanced
2019	14.327	16.852	17.63	524
2018	15.394	14.327	-6.93	656
2017	13.631	15.394	12.93	1,124
2016	13.018	13.631	4.71	2,440
2015	13.390	13.018	-2.78	4,062
2014	12.788	13.390	4.71	5,099
2013	11.073	12.788	15.49	6,348
2012	10.005	11.073	10.67	6,676
2011	10.092	10.005	-0.86	6,895
2010	9.049	10.092	11.53	7,259
SAM Conservative Balanced
2019	13.881	15.768	13.59	245
2018	14.676	13.881	-5.42	363
2017	13.432	14.676	9.26	456
2016	12.883	13.432	4.26	659
2015	13.247	12.883	-2.75	1,288
2014	12.723	13.247	4.12	1,509
2013	11.626	12.723	9.44	1,630
2012	10.652	11.626	9.15	1,768
2011	10.608	10.652	0.42	1,853
2010	9.662	10.608	9.79	1,835
SAM Conservative Growth
2019	14.328	17.424	21.61	352
2018	15.656	14.328	-8.48	488
2017	13.334	15.656	17.41	670
2016	12.714	13.334	4.88	847
2015	13.114	12.714	-3.05	1,128
2014	12.454	13.114	5.30	1,278
2013	10.310	12.454	20.80	1,250
2012	9.199	10.310	12.08	1,149
2011	9.413	9.199	-2.27	1,055
2010	8.323	9.413	13.10	966

Appendix I – Condensed Financial Information         228

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
SAM Flexible Income
2019	$13.819	$15.340	11.01%	287
2018	14.383	13.819	-3.92	598
2017	13.535	14.383	6.27	797
2016	12.899	13.535	4.93	1,234
2015	13.334	12.899	-3.26	1,445
2014	12.830	13.334	3.93	1,665
2013	12.136	12.830	5.72	1,967
2012	11.175	12.136	8.60	1,917
2011	11.011	11.175	1.49	1,716
2010	10.149	11.011	8.49	1,763
SAM Strategic Growth
2019	14.124	17.644	24.92	430
2018	15.767	14.124	-10.42	480
2017	13.160	15.767	19.81	694
2016	12.648	13.160	4.05	798
2015	13.116	12.648	-3.57	1,108
2014	12.313	13.116	6.52	1,123
2013	9.846	12.313	25.06	1,064
2012	8.683	9.846	13.40	901
2011	9.016	8.683	-3.69	861
2010	7.891	9.016	14.26	810
Short-Term Income
2019	10.979	11.268	2.63	34
2018	11.089	10.979	-0.99	43
2017	11.049	11.089	0.37	103
2016	11.036	11.049	0.12	201
2015	11.180	11.036	-1.29	410
2014	11.212	11.180	-0.29	937
2013	11.300	11.212	-0.78	1,776
2012	10.964	11.300	0.03	2,178
2011	11.017	10.964	-0.48	2,051
2010	10.771	11.017	2.28	2,302
SmallCap
2019	20.706	25.857	24.87	87
2018	23.708	20.706	-12.66	97
2017	21.428	23.708	10.64	121
2016	18.623	21.428	15.06	132
2015	19.018	18.623	-2.08	209
2014	18.497	19.018	2.82	35
2013(1)	15.158	18.497	22.03	26

Appendix I – Condensed Financial Information         229

For Contracts With the Premium Payment Credit Rider
Accumulation Unit Value
Division	Beginning of Period	End of Period	Percentage Change from Prior Period	Number of Accumulation Units Outstanding End of Period (in thousands)
TOPS Aggressive Growth ETF
2019	$8.592	$10.449	21.61%	-
2018(11)	10.000	8.592	-14.08	-
TOPS Balanced ETF
2019	9.256	10.504	13.48	-
2018(11)	10.000	9.256	-7.44	-
TOPS Conservative ETF
2019	9.585	10.461	9.14	17
2018(11)	10.000	9.585	-4.15	-
TOPS Growth ETF
2019	8.781	10.477	19.31	3
2018(11)	10.000	8.781	-12.19	-
TOPS Moderate Growth ETF
2019	9.093	10.564	16.18	-
2018(11)	10.000	9.093	-9.07	-

⁽¹⁾ Commenced Operations on May 18, 2013

⁽²⁾ Commenced Operations on April 25, 2014

⁽³⁾ Commenced Operations on May 22, 2010

⁽⁴⁾ Commenced Operations on May 21, 2016

⁽⁵⁾ Commenced Operations on May 16, 2015

⁽⁶⁾ Commenced Operations on June 8, 2019

⁽⁷⁾ Commenced Operations on April 8, 2016

⁽⁸⁾ Commenced Operations on January 4, 2010

⁽⁹⁾ Commenced Operations on October 31, 2013

⁽¹⁰⁾ Commenced Operations on May 15, 2012

⁽¹¹⁾ Commenced Operations on June 11, 2018

Appendix I – Condensed Financial Information         230

PART B

PRINCIPAL LIFE INSURANCE COMPANY SEPARATE ACCOUNT B

PRINCIPAL^® INVESTMENT PLUS VARIABLE ANNUITY

(FOR APPLICATIONS SIGNED BEFORE AUGUST 1, 2013)

Statement of Additional Information

dated May 1, 2020

This Statement of Additional Information provides information about the Principal ^® Investment Plus Variable Annuity (the “Contract”) in addition to the information that is contained in the Contract’s Prospectus dated May 1, 2020.

This Statement of Additional Information is not a prospectus. It should be read in conjunction with the Prospectus, a copy of which can be obtained free of charge by writing or calling:

Principal^® Investment Plus Variable Annuity

The Principal Financial Group

P.O. Box 9382

Des Moines, Iowa 50306-9382

Telephone: 1-800-852-4450

TABLE OF CONTENTS
GENERAL INFORMATION AND HISTORY	3
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	3
PRINCIPAL UNDERWRITER	3
CALCULATION OF PERFORMANCE DATA	3
TAXATION UNDER CERTAIN RETIREMENT PLANS	12
FINANCIAL STATEMENTS	A-1
APPENDIX A - Principal Life Insurance Company Separate Account B	A-1
APPENDIX B - Principal Life Insurance Company	B-1

2

GENERAL INFORMATION AND HISTORY

Principal Life Insurance Company (the “Company”) is the issuer of the Principal^® Investment Plus Variable Annuity (the “Contract”) and serves as custodian of its assets. The Company is a stock life insurance company with authority to transact life and annuity business in all states of the United States and the District of Columbia. The Company’s home office is located at: Principal Financial Group, Des Moines, Iowa 50392. The Company is a wholly owned subsidiary of Principal Financial Services, Inc., which in turn, is a wholly owned direct subsidiary of Principal Financial Group, Inc., a publicly-traded company.

On June 24, 1879, the Company was incorporated under Iowa law as a mutual assessment life insurance company named Bankers Life Association. The Company became a legal reserve life insurance company and changed its name to Bankers Life Company in 1911. In 1986, the Company changed its name to Principal Mutual Life Insurance Company. In 1998, the Company became Principal Life Insurance Company, a subsidiary stock life insurance company of Principal Mutual Holding Company, as part of a reorganization into a mutual insurance holding company structure. In 2001, Principal Mutual Holding Company converted to a stock company through a process called demutualization, resulting in the current organizational structure.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ernst & Young LLP, 801 Grand Avenue, Suite 3000, Des Moines, Iowa 50309, serves as the independent registered public accounting firm for Principal Life Insurance Company Separate Account B and the Principal Life Insurance Company.

PRINCIPAL UNDERWRITER

The principal underwriter of the Contract is Principal Securities, Inc. ("PSI") which is a wholly owned subsidiary of Principal Financial Services, Inc. and an affiliate of the Company. The address of PSI is the Principal Financial Group, 655 9th Street, Des Moines, Iowa 50392. PSI was incorporated in Iowa in 1968 and is a securities broker-dealer registered with the Securities Exchange Commission as well as a member of the FINRA. The Contracts may also be sold through other broker-dealers authorized by PSI and applicable law to do so. Registered representatives of such broker-dealers may be paid on a different basis than described below.

The Contract’s offering to the public is continuous. As the principal underwriter, PSI is paid for the distribution of the Contract. For the last three fiscal years PSI has received and retained the following commissions:

2019 received/retained	2018 received/retained	2017 received/retained
$10,135,758/$0	$10,443,907/$0	$17,241,084/$0

CALCULATION OF PERFORMANCE DATA

The Separate Account may publish advertisements containing information (including graphs, charts, tables and examples) about the performance of one or more of its divisions. Separate performance figures will be shown for the Contract without the premium payment credit rider and for the Contract with the premium payment credit rider.

The Contract was not offered prior to March 1, 2005. However, the certain divisions invest in underlying mutual funds which were offered prior to the date the Contract was available. Thus, the Separate Account may publish advertisements containing information about the hypothetical performance of one or more of its divisions for this Contract as the Contract was issued on or after the date the underlying mutual fund was first offered. The hypothetical performance from the date of inception of the underlying mutual fund in which the division invests is derived by reducing the actual performance of the underlying mutual fund by the highest level of fees and charges of the Contract as if it had been in existence.

In addition, as certain of the underlying mutual funds have added classes since the inception of the fund, performance may be shown for periods prior to the inception date of the new class which represents the historical results of initial class shares adjusted to reflect the fees and expenses of the new class.

The yield and total return figures described below will vary depending upon market conditions, the composition of the underlying mutual fund’s portfolios and operating expenses. These factors and possible differences in the methods used in calculating yield and total return should be considered when comparing the Separate Account performance figures to performance figures published for other investment vehicles.

3

The Separate Account may also quote rankings, yields or returns as published by independent statistical services or publishers and information regarding performance of certain market indices. Any performance data quoted for the Separate Account represents only historical performance and is not intended to indicate future performance.

From time to time the Separate Account advertises its Fidelity VIP Government Money Market Division’s “yield” and “effective yield” for the Contract. Both yield figures are based on historical earnings and are not intended to indicate future performance. The “yield” of the division refers to the income generated by an investment under the Contract in the division over a 7-day period (which period will be stated in the advertisement). This income is then “annualized.” That is, the amount of income generated by the investment during that week is assumed to be generated each week over a 52-week period and is shown as a percentage of the investment. The “effective yield” is calculated similarly but, when annualized, the income earned by an investment in the division is assumed to be reinvested. The “effective yield” will be slightly higher than the “yield” because of the compounding effect of this assumed reinvestment. Neither yield quotation reflects a sales load deducted from purchase payments which, if included, would reduce the “yield” and “effective yield.”

	Yield For the Period Ended December 31, 2019
For Contracts:	7-Day Annualized Yield	7-Day Effective Yield
without a surrender charge or a Purchase Payment Credit Rider	0.01%	0.01%
with a surrender charge but without a Purchase Payment Credit Rider	-5.99%	-5.99%
without a surrender charge but with a Purchase Payment Credit Rider	-0.59%	-0.59%

Also, from time to time, the Separate Account will advertise the average annual total return of its various divisions. The average annual total return for any of the divisions is computed by calculating the average annual compounded rate of return over the stated period that would equate an initial $1,000 investment to the ending redeemable Contract value. In this calculation for the Contract without the Premium Payment Credit Rider, the ending value is reduced by a surrender charge that decreases from 6% to 0% over a period of 7 years. For the calculations relating to the Contract with the Premium Payment Credit Rider, the ending value is reduced by a surrender charge that decreases from 8% to 0% over a period of 9 years. The Separate Account may also advertise total return figures for its divisions for a specified period that does not take into account the surrender charge in order to illustrate the change in the division’s unit value over time. See “Charges and Deductions” in the Prospectus for a discussion of surrender charges.

Following are the hypothetical average annual total returns for the period ending December 31, 2019 assuming the Contract had been offered as of the effective dates of the underlying mutual funds in which the divisions invest (the performance calculations with Surrender Charge are in accordance with the SEC standard, while the performance calculations without the Surrender Charge are not in accordance with the SEC standard):

	For Contracts without the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
AllianceBernstein Small Cap Growth	08/05/1996	28.48%	11.79%	14.62%
AllianceBernstein Small/Mid Cap Value	05/02/2001	12.40%	4.42%	9.50%
American Asset Allocation	08/01/1989	13.52%	6.33%	8.37%
American Blue Chip Income and Growth	07/05/2001	13.67%	6.38%	9.70%
American Century VP Capital Appreciation	11/20/1987	27.66%	8.51%	11.17%
American Century VP Inflation Protection	12/31/2002	1.37%	0.21%	1.51%
American Century VP Mid Cap Value	10/29/2004	21.18%	6.62%	10.57%
American Century VP Ultra	05/01/2001	26.57%	12.61%	13.17%
American Funds Global Small Capitalization	04/30/1998	23.67%	6.69%	7.26%
American New World	06/17/1999	21.33%	5.94%	4.54%
BlackRock Global Allocation VI	02/28/1992	10.10%	2.92%	4.12%
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)	04/30/2014	13.52%	4.09%		3.77%
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)	08/31/1999	17.75%	12.31%	12.70%
Columbia Limited Duration Credit	05/07/2010	-0.05%	0.32%		1.02%

4

	For Contracts without the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Core Plus Bond	12/18/1987	2.26%	1.26%	3.24%
Delaware VIP Limited Term Diversified Income	05/01/2000	-2.67%	-0.23%	0.41%
Delaware VIP Small Cap Value	05/01/2000	19.92%	5.77%	10.16%
Deutsche Small Mid Cap Value	05/01/1996	13.29%	2.88%	7.41%
Diversified Balanced	12/30/2009	10.56%	4.38%	6.09%
Diversified Balanced Managed Volatility	10/31/2013	9.82%	4.06%		4.83%
Diversified Growth	12/30/2009	13.49%	5.45%	7.32%
Diversified Growth Managed Volatility	10/31/2013	12.49%	5.06%		5.81%
Diversified Income	05/15/2012	7.54%	3.27%		4.67%
Diversified International	05/02/1994	14.96%	3.47%	4.62%
EQ Advisors Trust 1290 VT Convertible Securities Portfolio	10/28/2013	16.32%	5.39%		6.37%
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio	08/01/1988	15.74%	5.28%	10.45%
EQ Advisors Trust 1290 VT Micro Cap Portfolio	04/18/2014	21.64%	8.35%		8.65%
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio	10/28/2013	19.25%	7.46%		7.81%
EQ Advisors Trust 1290 VT Socially Responsible Portfolio	08/31/1999	22.61%	8.90%	11.46%
Equity Income	04/28/1998	21.27%	8.55%	11.09%
Fidelity VIP Contrafund	01/03/1995	23.43%	8.03%	10.50%
Fidelity VIP Equity-Income	10/09/1986	19.32%	6.11%	9.23%
Fidelity VIP Government Money Market	04/01/1982	-5.42%	-1.13%	-0.92%
Fidelity VIP Growth	10/09/1986	26.09%	12.11%	13.69%
Fidelity VIP Mid Cap	12/28/1998	15.44%	4.86%	8.68%
Fidelity VIP Overseas	01/28/1987	19.71%	4.62%	4.91%
Franklin Global Real Estate VIP	01/24/1989	14.65%	2.96%	6.59%
Franklin Small Cap Value VIP	04/30/1998	18.57%	6.00%	9.88%
Goldman Sachs VIT Mid Cap Value	05/01/1998	23.68%	4.15%	9.42%
Goldman Sachs VIT Small Cap Equity Insights	02/13/1998	17.09%	6.95%	11.12%
Government & High Quality Bond	05/06/1993	-1.05%	0.32%	1.75%
Guggenheim Floating Rate Strategies	04/22/2013	0.09%	1.83%		2.14%
Guggenheim Global Managed Futures Strategy	11/07/2008	0.62%	-4.23%	-3.51%
Guggenheim Long Short Equity Fund	05/01/2002	-1.95%	-0.57%	2.03%
Guggenheim Multi-Hedge Strategies	11/29/2005	-2.47%	-1.11%	0.81%
Guggenheim Rydex Commodities Strategy	09/30/2005	7.63%	-7.84%	-8.52%
International Emerging Markets	10/24/2000	9.95%	2.27%	1.61%
Invesco Global Health Care	05/21/1997	24.64%	5.18%	10.57%
Invesco VI International Growth	05/05/1993	20.76%	3.50%	5.22%
Invesco VI Small Cap Equity	08/29/2003	18.82%	3.35%	8.77%
Invesco VI Value Opportunities	09/10/2001	22.78%	3.61%	7.19%
Janus Henderson Flexible Bond	09/13/1993	1.74%	0.61%	2.48%
LargeCap Growth I	06/01/1994	27.02%	13.34%	13.83%
LargeCap S&P 500 Index	05/03/1999	23.26%	9.41%	11.68%
MFS International Intrinsic Value (f.k.a. MFS International Value)	08/23/2001	17.88%	7.71%	8.22%
MFS New Discovery	05/01/1998	33.29%	11.32%	12.09%
MFS Utilities	01/03/1995	17.04%	4.43%	8.23%
MFS Value	01/02/2002	21.68%	6.97%	9.89%
MidCap	12/18/1987	35.09%	11.51%	14.85%
Neuberger Berman AMT Mid Cap Growth	11/03/1997	24.62%	8.17%	11.21%
Neuberger Berman AMT Socially Responsive	02/18/1999	18.11%	6.99%	10.41%
Northern Lights TOPS Aggressive Growth ETF	07/22/2015	16.32%			4.92%

5

	For Contracts without the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Northern Lights TOPS Balanced ETF	07/22/2015	8.14%			3.18%
Northern Lights TOPS Conservative ETF	07/22/2015	3.78%			2.06%
Northern Lights TOPS Growth ETF	07/22/2015	14.01%			5.04%
Northern Lights TOPS Moderate Growth ETF	07/22/2015	10.85%			4.15%
PIMCO VIT All Asset	04/30/2003	4.32%	2.30%	3.70%
PIMCO VIT High Yield Portfolio	04/30/1998	7.13%	3.66%	5.45%
PIMCO VIT Low Duration	03/31/2006	-3.54%	-0.68%	0.47%
PIMCO VIT Total Return	12/31/1997	0.84%	1.10%	2.47%
Principal Capital Appreciation	04/28/1998	24.62%	9.51%	11.42%
Principal LifeTime 2010	08/30/2004	6.49%	2.91%	5.23%
Principal LifeTime 2020	08/30/2004	10.45%	4.08%	6.51%
Principal LifeTime 2030	08/30/2004	14.29%	5.03%	7.27%
Principal LifeTime 2040	08/30/2004	16.99%	5.72%	7.98%
Principal LifeTime 2050	08/30/2004	18.61%	6.14%	8.29%
Principal LifeTime Strategic Income	08/30/2004	4.87%	2.23%	4.07%
Real Estate Securities	05/01/1998	23.41%	6.66%	11.36%
SAM Balanced	06/03/1997	12.32%	4.82%	7.04%
SAM Conservative Balanced	04/23/1998	8.25%	3.63%	5.63%
SAM Conservative Growth	06/03/1997	16.31%	5.99%	8.30%
SAM Flexible Income	09/09/1997	5.65%	2.91%	4.82%
SAM Strategic Growth	06/03/1997	19.65%	6.26%	9.01%
Short-Term Income	01/12/1994	-2.78%	0.15%	1.03%
SmallCap	05/01/1998	19.61%	6.49%	11.06%
T. Rowe Price Blue Chip Growth	12/29/2000	21.75%	12.80%	13.97%
T. Rowe Price Health Sciences	12/29/2000	20.82%	8.66%	16.90%
Templeton Global Bond VIP	01/24/1989	-5.58%	-1.29%	1.93%
VanEck VIP Global Hard Assets	05/01/2006	3.97%	-7.88%	-4.39%

	For Contracts without the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
AllianceBernstein Small Cap Growth	08/05/1996	34.48%	12.17%	14.62%
AllianceBernstein Small/Mid Cap Value	05/02/2001	18.40%	4.92%	9.50%
American Asset Allocation	08/01/1989	19.52%	6.79%	8.37%
American Blue Chip Income and Growth	07/05/2001	19.67%	6.85%	9.70%
American Century VP Capital Appreciation	11/20/1987	33.66%	8.94%	11.17%
American Century VP Inflation Protection	12/31/2002	7.37%	0.79%	1.51%
American Century VP Mid Cap Value	10/29/2004	27.18%	7.08%	10.57%
American Century VP Ultra	05/01/2001	32.57%	12.98%	13.17%
American Funds Global Small Capitalization	04/30/1998	29.67%	7.15%	7.26%
American New World	06/17/1999	27.33%	6.41%	4.54%
BlackRock Global Allocation VI	02/28/1992	16.10%	3.45%	4.12%
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)	04/30/2014	19.52%	4.59%		4.06%
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)	08/31/1999	23.75%	12.69%	12.70%
Columbia Limited Duration Credit	05/07/2010	5.95%	0.90%		1.02%
Core Plus Bond	12/18/1987	8.26%	1.82%	3.24%

6

	For Contracts without the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Delaware VIP Limited Term Diversified Income	05/01/2000	3.33%	0.36%	0.41%
Delaware VIP Small Cap Value	05/01/2000	25.92%	6.25%	10.16%
Deutsche Small Mid Cap Value	05/01/1996	19.29%	3.41%	7.41%
Diversified Balanced	12/30/2009	16.56%	4.88%	6.09%
Diversified Balanced Managed Volatility	10/31/2013	15.82%	4.57%		4.83%
Diversified Growth	12/30/2009	19.49%	5.93%	7.32%
Diversified Growth Managed Volatility	10/31/2013	18.49%	5.55%		5.81%
Diversified Income	05/15/2012	13.54%	3.79%		4.67%
Diversified International	05/02/1994	20.96%	3.99%	4.62%
EQ Advisors Trust 1290 VT Convertible Securities Portfolio	10/28/2013	22.32%	5.87%		6.37%
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio	08/01/1988	21.74%	5.77%	10.45%
EQ Advisors Trust 1290 VT Micro Cap Portfolio	04/18/2014	27.64%	8.78%		8.88%
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio	10/28/2013	25.25%	7.91%		7.81%
EQ Advisors Trust 1290 VT Socially Responsible Portfolio	08/31/1999	28.61%	9.32%	11.46%
Equity Income	04/28/1998	27.27%	8.98%	11.09%
Fidelity VIP Contrafund	01/03/1995	29.43%	8.47%	10.50%
Fidelity VIP Equity-Income	10/09/1986	25.32%	6.58%	9.23%
Fidelity VIP Government Money Market	04/01/1982	0.58%	-0.51%	-0.92%
Fidelity VIP Growth	10/09/1986	32.09%	12.48%	13.69%
Fidelity VIP Mid Cap	12/28/1998	21.44%	5.35%	8.68%
Fidelity VIP Overseas	01/28/1987	25.71%	5.11%	4.91%
Franklin Global Real Estate VIP	01/24/1989	20.65%	3.49%	6.59%
Franklin Small Cap Value VIP	04/30/1998	24.57%	6.47%	9.88%
Goldman Sachs VIT Mid Cap Value	05/01/1998	29.68%	4.65%	9.42%
Goldman Sachs VIT Small Cap Equity Insights	02/13/1998	23.09%	7.41%	11.12%
Government & High Quality Bond	05/06/1993	4.95%	0.90%	1.75%
Guggenheim Floating Rate Strategies	04/22/2013	6.09%	2.38%		2.14%
Guggenheim Global Managed Futures Strategy	11/07/2008	6.62%	-3.53%	-3.51%
Guggenheim Long Short Equity Fund	05/01/2002	4.05%	0.04%	2.03%
Guggenheim Multi-Hedge Strategies	11/29/2005	3.53%	-0.49%	0.81%
Guggenheim Rydex Commodities Strategy	09/30/2005	13.63%	-7.02%	-8.52%
International Emerging Markets	10/24/2000	15.95%	2.81%	1.61%
Invesco Global Health Care	05/21/1997	30.64%	5.67%	10.57%
Invesco VI International Growth	05/05/1993	26.76%	4.01%	5.22%
Invesco VI Small Cap Equity	08/29/2003	24.82%	3.87%	8.77%
Invesco VI Value Opportunities	09/10/2001	28.78%	4.13%	7.19%
Janus Henderson Flexible Bond	09/13/1993	7.74%	1.19%	2.48%
LargeCap Growth I	06/01/1994	33.02%	13.70%	13.83%
LargeCap S&P 500 Index	05/03/1999	29.26%	9.83%	11.68%
MFS International Intrinsic Value (f.k.a. MFS International Value)	08/23/2001	23.88%	8.15%	8.22%
MFS New Discovery	05/01/1998	39.29%	11.71%	12.09%
MFS Utilities	01/03/1995	23.04%	4.93%	8.23%
MFS Value	01/02/2002	27.68%	7.42%	9.89%
MidCap	12/18/1987	41.09%	11.89%	14.85%
Neuberger Berman AMT Mid Cap Growth	11/03/1997	30.62%	8.61%	11.21%
Neuberger Berman AMT Socially Responsive	02/18/1999	24.11%	7.44%	10.41%
Northern Lights TOPS Aggressive Growth ETF	07/22/2015	22.32%			5.48%
Northern Lights TOPS Balanced ETF	07/22/2015	14.14%			3.78%

7

	For Contracts without the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Northern Lights TOPS Conservative ETF	07/22/2015	9.78%			2.68%
Northern Lights TOPS Growth ETF	07/22/2015	20.01%			5.60%
Northern Lights TOPS Moderate Growth ETF	07/22/2015	16.85%			4.73%
PIMCO VIT All Asset	04/30/2003	10.32%	2.84%	3.70%
PIMCO VIT High Yield Portfolio	04/30/1998	13.13%	4.18%	5.45%
PIMCO VIT Low Duration	03/31/2006	2.46%	-0.07%	0.47%
PIMCO VIT Total Return	12/31/1997	6.84%	1.66%	2.47%
Principal Capital Appreciation	04/28/1998	30.62%	9.92%	11.42%
Principal LifeTime 2010	08/30/2004	12.49%	3.43%	5.23%
Principal LifeTime 2020	08/30/2004	16.45%	4.59%	6.51%
Principal LifeTime 2030	08/30/2004	20.29%	5.52%	7.27%
Principal LifeTime 2040	08/30/2004	22.99%	6.20%	7.98%
Principal LifeTime 2050	08/30/2004	24.61%	6.61%	8.29%
Principal LifeTime Strategic Income	08/30/2004	10.87%	2.77%	4.07%
Real Estate Securities	05/01/1998	29.41%	7.12%	11.36%
SAM Balanced	06/03/1997	18.32%	5.32%	7.04%
SAM Conservative Balanced	04/23/1998	14.25%	4.15%	5.63%
SAM Conservative Growth	06/03/1997	22.31%	6.46%	8.30%
SAM Flexible Income	09/09/1997	11.65%	3.44%	4.82%
SAM Strategic Growth	06/03/1997	25.65%	6.73%	9.01%
Short-Term Income	01/12/1994	3.22%	0.74%	1.03%
SmallCap	05/01/1998	25.61%	6.96%	11.06%
T. Rowe Price Blue Chip Growth	12/29/2000	27.75%	13.17%	13.97%
T. Rowe Price Health Sciences	12/29/2000	26.82%	9.09%	16.90%
Templeton Global Bond VIP	01/24/1989	0.42%	-0.66%	1.93%
VanEck VIP Global Hard Assets	05/01/2006	9.97%	-7.06%	-4.39%

	For Contracts with the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
AllianceBernstein Small Cap Growth	08/05/1996	25.68%	10.97%	13.94%
AllianceBernstein Small/Mid Cap Value	05/02/2001	9.70%	3.61%	8.85%
American Asset Allocation	08/01/1989	10.81%	5.52%	7.72%
American Blue Chip Income and Growth	07/05/2001	10.95%	5.57%	9.04%
American Century VP Capital Appreciation	11/20/1987	24.86%	7.70%	10.50%
American Century VP Inflation Protection	12/31/2002	-1.28%	-0.62%	0.90%
American Century VP Mid Cap Value	10/29/2004	18.42%	5.81%	9.91%
American Century VP Ultra	05/01/2001	23.78%	11.80%	12.49%
American Funds Global Small Capitalization	04/30/1998	20.89%	5.88%	6.62%
American New World	06/17/1999	18.57%	5.13%	3.91%
BlackRock Global Allocation VI	02/28/1992	7.40%	2.10%	3.49%
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)	04/30/2014	10.80%	3.27%		2.98%
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)	08/31/1999	15.01%	11.50%	12.02%
Columbia Limited Duration Credit	05/07/2010	-2.68%	-0.51%		0.41%
Core Plus Bond	12/18/1987	-0.39%	0.44%	2.62%
Delaware VIP Limited Term Diversified Income	05/01/2000	-5.29%	-1.06%	-0.20%

8

	For Contracts with the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Delaware VIP Small Cap Value	05/01/2000	17.17%	4.96%	9.50%
Deutsche Small Mid Cap Value	05/01/1996	10.57%	2.07%	6.76%
Diversified Balanced Managed Volatility	10/31/2013	7.13%	3.25%		3.94%
Diversified Balanced	12/30/2009	7.87%	3.57%	5.46%
Diversified Growth Managed Volatility	10/31/2013	9.78%	4.25%		4.92%
Diversified Growth	12/30/2009	10.77%	4.63%	6.67%
Diversified Income	05/15/2012	4.86%	2.46%		3.94%
Diversified International	05/02/1994	12.24%	2.66%	4.00%
EQ Advisors Trust 1290 VT Convertible Securities Portfolio	10/28/2013	13.46%	4.34%		5.24%
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio	08/01/1988	12.89%	4.23%	9.53%
EQ Advisors Trust 1290 VT Micro Cap Portfolio	04/18/2014	18.74%	7.29%		7.62%
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio	10/28/2013	16.37%	6.41%		6.69%
EQ Advisors Trust 1290 VT Socially Responsible Portfolio	08/31/1999	19.70%	7.84%	10.53%
Equity Income	04/28/1998	18.51%	7.74%	10.43%
Fidelity VIP Contrafund	01/03/1995	20.65%	7.22%	9.84%
Fidelity VIP Equity-Income	10/09/1986	16.57%	5.29%	8.58%
Fidelity VIP Government Money Market	04/01/1982	-8.03%	-1.96%	-1.52%
Fidelity VIP Growth	10/09/1986	23.30%	11.29%	13.01%
Fidelity VIP Mid Cap	12/28/1998	12.71%	4.04%	8.03%
Fidelity VIP Overseas	01/28/1987	16.95%	3.80%	4.28%
Franklin Global Real Estate VIP	01/24/1989	11.93%	2.14%	5.95%
Franklin Small Cap Value VIP	04/30/1998	15.82%	5.18%	9.22%
Goldman Sachs VIT Mid Cap Value	05/01/1998	20.90%	3.33%	8.77%
Goldman Sachs VIT Small Cap Equity Insights	02/13/1998	14.35%	6.14%	10.46%
Government & High Quality Bond	05/06/1993	-3.68%	-0.51%	1.14%
Guggenheim Floating Rate Strategies	04/22/2013	-2.55%	1.01%		1.25%
Guggenheim Global Managed Futures Strategy	11/07/2008	-2.02%	-5.07%	-4.09%
Guggenheim Long Short Equity Fund	05/01/2002	-4.57%	-1.40%	1.42%
Guggenheim Multi-Hedge Strategies	11/29/2005	-5.09%	-1.94%	0.21%
Guggenheim Rydex Commodities Strategy	09/30/2005	4.95%	-8.70%	-9.07%
International Emerging Markets	10/24/2000	7.25%	1.45%	1.00%
Invesco Global Health Care	05/21/1997	21.86%	4.37%	9.91%
Invesco VI International Growth	05/05/1993	18.00%	2.68%	4.59%
Invesco VI Small Cap Equity	08/29/2003	16.07%	2.54%	8.11%
Invesco VI Value Opportunities	09/10/2001	20.01%	2.80%	6.55%
Janus Henderson Flexible Bond	09/13/1993	-0.91%	-0.21%	1.86%
LargeCap Growth I	06/01/1994	24.22%	12.52%	13.15%
LargeCap S&P 500 Index	05/03/1999	20.49%	8.60%	11.01%
MFS International Intrinsic Value (f.k.a. MFS International Value)	08/23/2001	15.14%	6.89%	7.57%
MFS New Discovery	05/01/1998	30.46%	10.51%	11.42%
MFS Utilities	01/03/1995	14.31%	3.62%	7.58%
MFS Value	01/02/2002	18.92%	6.15%	9.23%
MidCap	12/18/1987	32.24%	10.70%	14.16%
Neuberger Berman AMT Mid Cap Growth	11/03/1997	21.84%	7.36%	10.54%
Neuberger Berman AMT Socially Responsive	02/18/1999	15.37%	6.17%	9.75%
Northern Lights TOPS Aggressive Growth ETF	07/22/2015	13.59%			4.75%
Northern Lights TOPS Balanced ETF	07/22/2015	5.46%			2.16%
Northern Lights TOPS Conservative ETF	07/22/2015	1.12%			1.04%

9

	For Contracts with the Premium Payment Credit Rider and with Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Northern Lights TOPS Growth ETF	07/22/2015	11.29%			4.02%
Northern Lights TOPS Moderate Growth ETF	07/22/2015	8.16%			3.14%
PIMCO VIT All Asset	04/30/2003	1.66%	1.48%	3.08%
PIMCO VIT High Yield Portfolio	04/30/1998	4.46%	2.85%	4.81%
PIMCO VIT Low Duration	03/31/2006	-6.15%	-1.50%	-0.13%
PIMCO VIT Total Return	12/31/1997	-1.80%	0.28%	1.86%
Principal Capital Appreciation	04/28/1998	21.84%	8.70%	10.76%
Principal LifeTime 2010	08/30/2004	3.82%	2.09%	4.60%
Principal LifeTime 2020	08/30/2004	7.76%	3.27%	5.87%
Principal LifeTime 2030	08/30/2004	11.57%	4.22%	6.63%
Principal LifeTime 2040	08/30/2004	14.25%	4.91%	7.33%
Principal LifeTime 2050	08/30/2004	15.86%	5.33%	7.64%
Principal LifeTime Strategic Income	08/30/2004	2.21%	1.41%	3.45%
Real Estate Securities	05/01/1998	20.64%	5.85%	10.69%
SAM Balanced	06/03/1997	9.61%	4.01%	6.40%
SAM Conservative Balanced	04/23/1998	5.57%	2.82%	5.00%
SAM Conservative Growth	06/03/1997	13.58%	5.18%	7.65%
SAM Flexible Income	09/09/1997	2.98%	2.09%	4.20%
SAM Strategic Growth	06/03/1997	16.90%	5.45%	8.36%
Short-Term Income	01/12/1994	-5.40%	-0.67%	0.43%
SmallCap	05/01/1998	16.85%	5.68%	10.40%
T. Rowe Price Blue Chip Growth	12/29/2000	18.99%	11.99%	13.28%
T. Rowe Price Health Sciences	12/29/2000	18.06%	7.85%	16.20%
Templeton Global Bond VIP	01/24/1989	-8.18%	-2.11%	1.32%
VanEck VIP Global Hard Assets	05/01/2006	1.32%	-8.74%	-4.96%

	For Contracts with the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
AllianceBernstein Small Cap Growth	08/05/1996	33.68%	11.50%	13.94%
AllianceBernstein Small/Mid Cap Value	05/02/2001	17.70%	4.29%	8.85%
American Asset Allocation	08/01/1989	18.81%	6.15%	7.72%
American Blue Chip Income and Growth	07/05/2001	18.95%	6.21%	9.04%
American Century VP Capital Appreciation	11/20/1987	32.86%	8.28%	10.50%
American Century VP Inflation Protection	12/31/2002	6.72%	0.19%	0.90%
American Century VP Mid Cap Value	10/29/2004	26.42%	6.44%	9.91%
American Century VP Ultra	05/01/2001	31.78%	12.30%	12.49%
American Funds Global Small Capitalization	04/30/1998	28.89%	6.51%	6.62%
American New World	06/17/1999	26.57%	5.78%	3.91%
BlackRock Global Allocation VI	02/28/1992	15.40%	2.83%	3.49%
BlackRock VIF 60/40 Target Allocation ETF VI (f.k.a. BlackRock iShares Dynamic Allocation VI)	04/30/2014	18.80%	3.97%		3.44%
BNY Mellon IP Technology Growth (f.k.a. Dreyfus IP Technology Growth)	08/31/1999	23.01%	12.01%	12.02%
Columbia Limited Duration Credit	05/07/2010	5.32%	0.30%		0.41%
Core Plus Bond	12/18/1987	7.61%	1.21%	2.62%
Delaware VIP Limited Term Diversified Income	05/01/2000	2.71%	-0.24%	-0.20%
Delaware VIP Small Cap Value	05/01/2000	25.17%	5.61%	9.50%

10

	For Contracts with the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Deutsche Small Mid Cap Value	05/01/1996	18.57%	2.79%	6.76%
Diversified Balanced Managed Volatility	10/31/2013	15.13%	3.94%		4.21%
Diversified Balanced	12/30/2009	15.87%	4.25%	5.46%
Diversified Growth Managed Volatility	10/31/2013	17.78%	4.92%		5.17%
Diversified Growth	12/30/2009	18.77%	5.29%	6.67%
Diversified Income	05/15/2012	12.86%	3.17%		4.04%
Diversified International	05/02/1994	20.24%	3.37%	4.00%
EQ Advisors Trust 1290 VT Convertible Securities Portfolio	10/28/2013	21.46%	5.00%		5.49%
EQ Advisors Trust 1290 VT GAMCO Small Company Value Portfolio	08/01/1988	20.89%	4.90%	9.53%
EQ Advisors Trust 1290 VT Micro Cap Portfolio	04/18/2014	26.74%	7.89%		7.99%
EQ Advisors Trust 1290 VT SmartBeta Equity Portfolio	10/28/2013	24.37%	7.02%		6.92%
EQ Advisors Trust 1290 VT Socially Responsible Portfolio	08/31/1999	27.70%	8.43%	10.53%
Equity Income	04/28/1998	26.51%	8.33%	10.43%
Fidelity VIP Contrafund	01/03/1995	28.65%	7.82%	9.84%
Fidelity VIP Equity-Income	10/09/1986	24.57%	5.94%	8.58%
Fidelity VIP Government Money Market	04/01/1982	-0.03%	-1.11%	-1.52%
Fidelity VIP Growth	10/09/1986	31.30%	11.81%	13.01%
Fidelity VIP Mid Cap	12/28/1998	20.71%	4.72%	8.03%
Fidelity VIP Overseas	01/28/1987	24.95%	4.48%	4.28%
Franklin Global Real Estate VIP	01/24/1989	19.93%	2.87%	5.95%
Franklin Small Cap Value VIP	04/30/1998	23.82%	5.83%	9.22%
Goldman Sachs VIT Mid Cap Value	05/01/1998	28.90%	4.03%	8.77%
Goldman Sachs VIT Small Cap Equity Insights	02/13/1998	22.35%	6.77%	10.46%
Government & High Quality Bond	05/06/1993	4.32%	0.30%	1.14%
Guggenheim Floating Rate Strategies	04/22/2013	5.45%	1.77%		1.52%
Guggenheim Global Managed Futures Strategy	11/07/2008	5.98%	-4.11%	-4.09%
Guggenheim Long Short Equity Fund	05/01/2002	3.43%	-0.56%	1.42%
Guggenheim Multi-Hedge Strategies	11/29/2005	2.91%	-1.09%	0.21%
Guggenheim Rydex Commodities Strategy	09/30/2005	12.95%	-7.58%	-9.07%
International Emerging Markets	10/24/2000	15.25%	2.20%	1.00%
Invesco Global Health Care	05/21/1997	29.86%	5.04%	9.91%
Invesco VI International Growth	05/05/1993	26.00%	3.39%	4.59%
Invesco VI Small Cap Equity	08/29/2003	24.07%	3.25%	8.11%
Invesco VI Value Opportunities	09/10/2001	28.01%	3.51%	6.55%
Janus Henderson Flexible Bond	09/13/1993	7.09%	0.58%	1.86%
LargeCap Growth I	06/01/1994	32.22%	13.02%	13.15%
LargeCap S&P 500 Index	05/03/1999	28.49%	9.17%	11.01%
MFS International Intrinsic Value (f.k.a. MFS International Value)	08/23/2001	23.14%	7.50%	7.57%
MFS New Discovery	05/01/1998	38.46%	11.04%	11.42%
MFS Utilities	01/03/1995	22.31%	4.30%	7.58%
MFS Value	01/02/2002	26.92%	6.78%	9.23%
MidCap	12/18/1987	40.24%	11.22%	14.16%
Neuberger Berman AMT Mid Cap Growth	11/03/1997	29.84%	7.95%	10.54%
Neuberger Berman AMT Socially Responsive	02/18/1999	23.37%	6.80%	9.75%
Northern Lights TOPS Aggressive Growth ETF	07/22/2015	21.59%			5.50%
Northern Lights TOPS Balanced ETF	07/22/2015	13.46%			2.99%
Northern Lights TOPS Conservative ETF	07/22/2015	9.12%			1.90%
Northern Lights TOPS Growth ETF	07/22/2015	19.29%			4.80%

11

	For Contracts with the Premium Payment Credit Rider and without Surrender Charge
Division	Effective Date	One Year	Five Years	Ten Years	Since Inception
Northern Lights TOPS Moderate Growth ETF	07/22/2015	16.16%			3.94%
PIMCO VIT All Asset	04/30/2003	9.66%	2.23%	3.08%
PIMCO VIT High Yield Portfolio	04/30/1998	12.46%	3.55%	4.81%
PIMCO VIT Low Duration	03/31/2006	1.85%	-0.66%	-0.13%
PIMCO VIT Total Return	12/31/1997	6.20%	1.05%	1.86%
Principal Capital Appreciation	04/28/1998	29.84%	9.26%	10.76%
Principal LifeTime 2010	08/30/2004	11.82%	2.82%	4.60%
Principal LifeTime 2020	08/30/2004	15.76%	3.96%	5.87%
Principal LifeTime 2030	08/30/2004	19.57%	4.89%	6.63%
Principal LifeTime 2040	08/30/2004	22.25%	5.56%	7.33%
Principal LifeTime 2050	08/30/2004	23.86%	5.97%	7.64%
Principal LifeTime Strategic Income	08/30/2004	10.21%	2.16%	3.45%
Real Estate Securities	05/01/1998	28.64%	6.48%	10.69%
SAM Balanced	06/03/1997	17.61%	4.69%	6.40%
SAM Conservative Balanced	04/23/1998	13.57%	3.52%	5.00%
SAM Conservative Growth	06/03/1997	21.58%	5.83%	7.65%
SAM Flexible Income	09/09/1997	10.98%	2.82%	4.20%
SAM Strategic Growth	06/03/1997	24.90%	6.09%	8.36%
Short-Term Income	01/12/1994	2.60%	0.13%	0.43%
SmallCap	05/01/1998	24.85%	6.32%	10.40%
T. Rowe Price Blue Chip Growth	12/29/2000	26.99%	12.49%	13.28%
T. Rowe Price Health Sciences	12/29/2000	26.06%	8.43%	16.20%
Templeton Global Bond VIP	01/24/1989	-0.18%	-1.26%	1.32%
VanEck VIP Global Hard Assets	05/01/2006	9.32%	-7.61%	-4.96%

TAXATION UNDER CERTAIN RETIREMENT PLANS

INDIVIDUAL RETIREMENT ANNUITIES

Contributions. Individuals may make contributions for individual retirement annuity (IRA) contracts. Individuals may make deductible contributions (for any year) up to the lesser of the amount shown in the chart or 100% of compensation.

Such individuals may establish a traditional IRA for a non-working spouse (if they file a joint return). The annual contribution for both spouses’ contracts cannot exceed the lesser of the amount shown in the chart or 100% of the working spouse’s compensation. No more than the individual IRA limit may be contributed to either spouse’s IRA for any year.

Traditional IRA - Maximum Annual Contribution
Year	Individual IRA	Individual IRA + Spousal IRA
2019	$6,000	$12,000
2020	$6,000	$12,000

For succeeding years, limits are indexed for cost of living.

Individuals age 50 or over are also permitted to make additional “catch-up” contributions. The additional contribution is $1,000 in 2019 and 2020. These additional catch-up contributions can be applied for Spousal IRA purposes.

Contributions may be tax deductible. If an individual and his/her spouse do not participate in a qualified retirement plan, the contributions to an IRA are fully tax deductible regardless of income. If an individual is an active participant in a qualified retirement plan, his/her ability to deduct the contributions depends upon his/her income level and tax filing status.

12

For individuals who are not active plan participants but whose spouses are, deductibility of traditional IRA contributions is phased out if the couple files a joint return and the Modified Adjusted Gross Income is between $196,000 and $206,000 in 2020.

Deductibility of Traditional IRA Contributions for Active Plan Participants
Married Individuals (Filing Jointly)			Single/Head of Household Individual
Year	Limited Deduction	No Deduction	Year	Limited Deduction	No Deduction
2019	$103,000	$123,000	2019	$64,000	$74,000
2020	$104,000	$124,000	2020	$65,000	$75,000

An individual may make non-deductible IRA contributions to the extent of the excess of:

(1)    The lesser of maximum annual contribution or 100% of compensation, over

(2)    The IRA deductible contributions made with respect to the individual.

A person whose filing status is "married, filing separately" may not make a full traditional IRA deduction contribution, unless the couple is separated and have been living apart for the entire year. Only a partial deductible contribution is allowed if your Modified Adjusted Gross Income is less than $10,000.

Taxation of Distributions . Distributions from IRA Contracts are taxed as ordinary income to the recipient, although special rules exist for the tax-free return of non-deductible contributions. In addition, taxable distributions received under an IRA Contract prior to age 59 ½ are subject to a 10% penalty tax in addition to regular income tax. Exempted from this 10% tax penalty are the following types of distributions: distributions due to death; distributions due to disability; if the distribution is paid as part of a series of substantially equal periodic payments made for the life (or life expectancy) of the Owner or the joint lives (or joint life expectancies) of the Owner and the Owner's designated Beneficiary; distributions to pay deductible medical expenses; distributions for unemployed health insurance premiums; distributions for first-time home purchases (up to $10,000); distributions for higher education expenses; made on account of certain levies on income and payments; qualified reservist distributions; and distributions for certain natural disaster victims; qualified birth or adoption distributions (up to $5,000).

Required Distributions . Generally, distributions from IRA Contracts must commence not later than April 1 of the calendar year following the calendar year in which the owner attains age 72 (“Required Beginning Date”), and such distributions must be made over a period that does not exceed the uniform lifetime distribution period or in certain instances under the joint life and last survivor period established by the IRS.

Upon the death of the Owner the required minimum distribution options available to the beneficiary will depend upon their status at the time of death. An eligible designated beneficiary must direct that payment of his/her benefits be made or started no later than December 31 of the year following the year of Owner’s death with annual distributions of at least the required minimum distribution. An eligible designated beneficiary is any designated beneficiary who is (1) the Owner’s spouse, (2) no more than ten (10) years younger than the Owner, (3) the Owner’s minor child who has not reached majority, (4) disabled, or chronically ill. If the surviving spouse is the eligible designated beneficiary on the IRA Contract, the surviving spouse may have additional distribution options.

A non-eligible individual designated beneficiary must distribute the entire balance of the IRA Contract by December 31 of the year in which occurs the tenth anniversary of the Owner’s death. An eligible designated beneficiary who is the Owner’s minor child ceases to retain the status upon reaching majority. Upon reaching majority the entire remaining balance of the Contract must be distributed by December 31 of the year in which occurs the tenth anniversary of the minor attaining majority.

If, Owner had not reached his or her Required Beginning Date and there is no designated beneficiary or Owner’s beneficiary is not an individual, the entire balance of the IRA Contract must be paid by December 31 of the year in which occurs the fifth anniversary of Owner’s death. If Owner had attained his or her Required Beginning Date prior to death, distributions must continue at least as rapidly as under the method in effect at the date of death. A penalty tax of 50% will be imposed on the amount by which the required minimum distribution in any year exceeds the amount actually distributed in that year.

Note: Required minimum distributions (RMDs) for 2020 are waived for certain defined contribution plans (including 401(k), 403(b), and governmental 457(b) plans) and IRAs. Beneficiaries receiving distributions over a 5-year period can waive the distribution for 2020 and determine the 5-year period without regard to calendar year 2020 .

13

Tax-Free Rollovers. The Internal Revenue Code (the “Code”) permits the taxable portion of funds to be transferred in a tax-free rollover from a qualified retirement plan, tax-deferred annuity plan or governmental 457(b) plan to an IRA Contract if certain conditions are met, and if the indirect rollover of assets is completed within 60 days after the distribution from the qualified plan is received by the plan participant. A direct rollover of funds may avoid a 20% federal tax withholding generally applicable to qualified plans, tax-deferred annuity plan, or governmental 457(b) plan distributions and the 60-day rollover rules. In addition, not more frequently than once every twelve months, an individual may execute one tax-free indirect rollover from one IRA to another, subject to the 60-day limitation and other requirements. The once-per-year limitation on rollovers does not apply to direct transfers of funds between IRA custodians or trustees or to Roth IRA conversions.

SIMPLIFIED EMPLOYEE PENSION (SEP) PLANS AND SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION (SAR/SEP) PLANS

Contributions . Under Section 408(k) of the Code, employers may establish a type of IRA plan referred to as a simplified employee pension plan (SEP). Employer contributions to a SEP cannot exceed the lesser of 25% of employee compensation or $57,000 for 2020.

Employees of certain small employers may have contributions made to the salary reduction simplified employee pension plan (SAR/SEP) on their behalf on a salary reduction basis. The amount that an employee chooses to defer and contribute to the SAR/SEP is referred to as an elective deferral.

These elective deferrals are subject to the same cap as elective deferrals to IRC Section 401(k) plans, see table below. In addition to the elective deferrals, SAR/SEP may permit additional elective deferrals by individuals age 50 or over, referred to as “catch-up contributions”.

No new SAR/SEP are permitted after 1996 for any employer, but those in effect prior to 1997 may continue to operate, receive contributions, and add new employees.

Salary Reduction Simplified Employee Pension Plan (SAR/SEP)
Year	Elective Deferral	Catch-up Contribution
2019	$19,000	$6,000
2020	$19,500	$6,500

Taxation of Distributions. Generally, distribution payments from SEPs and SAR/SEPs are subject to the same distribution rules described above for traditional IRAs.

Required Distributions. SEPs and SAR/SEPs are subject to the same minimum required distribution rules described above for traditional IRAs.

Tax-Free Rollovers. Generally, rollovers and direct transfers may be made to and from SEPs and SAR/SEPs in the same manner as described above for traditional IRAs, subject to the same conditions and limitations.

SAVINGS INCENTIVE MATCH PLANS FOR EMPLOYEES (SIMPLE IRA)

Contributions. Under Section 408(p) of the Code, employers may establish a type of IRA plan known as a SIMPLE IRA. Employees may have contributions made to the SIMPLE IRA on a salary reduction basis. The amount that an employee chooses to defer and contribute to the SIMPLE IRA is referred to as an elective deferral.

These elective deferrals cannot exceed the amounts shown in the chart. In addition to the elective deferrals, SIMPLE IRA may permit additional elective deferrals by individuals age 50 or over, referred to as “catch-up contributions” in an amount equal to $3,000 for 2020.

Elective contribution amounts made under the salary reduction portions (i.e., those subject to the $13,500 limit in 2020) of a SIMPLE IRA plan are counted in the overall limit on elective deferrals by any individual. For example, if in 2020, an individual under age 50 defers the maximum of $13,500 to a SIMPLE IRA of one employer and also participates in a 401(k) plan of another employer, they would be limited to an elective deferral of $6,000 ($19,500 - $13,500) to the 401(k) plan for 2020.

The employer generally must match either 100% of the employee’s elective deferral, up to 3% of the employee’s compensation (subject to certain exceptions) or fixed nonelective contributions of 2% of compensation of all eligible employees.

14

Savings Incentive Match Plan for Employees (SIMPLE IRA)
Year	Elective Deferral	Catch-up Contribution	401(k) Elective Deferral
2019	$13,000	$3,000	$19,000
2020	$13,500	$3,000	$19,500

Taxation of Distributions. Generally, distribution payments from SIMPLE IRAs are subject to the same distribution rules described above for traditional IRAs, except that distributions made within two years of the date of an employee’s first participation in a SIMPLE IRA of an employer are subject to a 25% penalty tax instead of the 10% penalty tax discussed previously.

Required Distributions. SIMPLE IRAs are subject to the same minimum required distribution rules described above for traditional IRAs.

Tax-Free Rollovers. Direct transfers may be made among SIMPLE IRAs in the same manner as described above for IRAs, subject to the same conditions and limitations. Rollovers from SIMPLE IRAs to other types of IRAs and certain qualified plans are permitted after two years have elapsed from the date of an employee’s first participation in a SIMPLE IRA of the employer. Rollovers to SIMPLE IRAs from other plans are permitted after two years of participation in the SIMPLE IRA.

ROTH INDIVIDUAL RETIREMENT ANNUITIES (ROTH IRA)

Contribution. Under Section 408A of the Code, individuals may contribute to a Roth IRA on his/her own behalf up to the lesser of maximum annual contribution limit as shown in the chart or 100% of compensation. In addition, the contribution must be reduced by the amount of any contributions made to other IRAs for the benefit of the same individual.

Roth IRA - Maximum Annual Contribution
Year	Individual Roth IRA	Catch-up Contribution
2019	$6,000	$1,000
2020	$6,000	$1,000

For succeeding years, individual Roth IRA limits are indexed for cost-of-living.

Individuals age 50 or over are also permitted to make additional “catch-up” contributions. The additional contribution is $1,000 for 2019 and 2020.

For 2020, the maximum contribution is phased out for single taxpayers with adjusted gross income between $124,000 and $139,000 and for joint filers with adjusted gross income between $196,000 and $206,000 (see chart below).

Modified Adjusted Gross Income Limits - 2019
Single/Head of Household	Married Filing Joint	ROTH IRA Contribution
< $124,000	< $196,000	Full Contribution
> $124,000 but < $139,000	> $196,000 but < $206,000	Partial Contribution*
> $139,000	> $206,000	No Contribution

* Those entitled to only a partial contribution should check with a tax advisor to determine the allowable contribution.

A person whose filing status is “married, filing separately” may not make a full Roth IRA contribution, unless the couple is separated and have been living apart for the entire year. Only a partial contribution is allowed if your Modified Adjusted Gross Income is less than $10,000.

Taxation of Distribution. Qualified distributions are received income-tax free by the Roth IRA owner, or beneficiary in case of the Roth IRA owner’s death. A qualified distribution is any distribution made after five years if the IRA owner is over age 59½, dies, becomes disabled, or uses the funds for first-time home purchase at the time of distribution. The five-year period for owner contributions begins January 1 of the year the first contribution is made to any Roth IRA. The five-year period for converted amounts begins from January 1 of the year of the conversion for the purposes of the 10% penalty tax.

Required Distributions. Roth IRAs are not subject to lifetime minimum required distributions. Roth IRAs are subject to the same post-death minimum required distribution rules described above for IRAs.

15

FINANCIAL STATEMENTS

APPENDIX A - Principal Life Insurance Company Separate Account B Financials

A-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors of Principal Life Insurance Company and Contract Owners of Principal Life Insurance Company Separate Account B

Opinion on the Financial Statements

We have audited the accompanying statements of assets and liabilities of each of the subaccounts listed in the Appendix that comprise Principal Life Insurance Company Separate Account B (the Separate Account), as of December 31, 2019, the related statements of operations and the statements of changes in net assets for each of the periods indicated in the Appendix, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of each subaccount as of December 31, 2019, the results of its operations and changes in its net assets for each of the periods indicated in the Appendix, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on each of the subaccounts’ financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Separate Account in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2019,by correspondence with the fund companies or their transfer agents, as applicable. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Ernst & Young LLP

We have served as the Separate Account’s auditor since 1970.

Des Moines, Iowa

March 27, 2020

A-2

Appendix:

Subaccounts comprising Principal Life Insurance Company Separate Account B

	Statement of operations	Statements of changes in net assets
AllianceBernstein Small Cap Growth Class A Division AllianceBernstein Small/Mid Cap Value Class A Division Alps/Red Rocks Listed Private Equity Class III Division American Century VP Capital Appreciation Class I Division	For the year ended December 31, 2019	For each of the two years in the period ended December 31, 2019
American Century VP Income & Growth Class I Division American Century VP Inflation Protection Class II Division American Century VP Mid Cap Value Class II Division American Century VP Ultra Class I Division
American Century VP Ultra Class II Division American Century VP Value Class II Division American Funds Insurance Series Asset Allocation Fund Class 2 Division American Funds Insurance Series Asset Allocation Fund Class 4 Division
American Funds Insurance Series Blue Chip Income and Growth Class 2 Division American Funds Insurance Series Blue Chip Income and Growth Class 4 Division American Funds Insurance Series Global Small Capitalization Fund Class 2 Division American Funds Insurance Series Global Small Capitalization Fund Class 4 Division
American Funds Insurance Series High-Income Bond Class 2 Division American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2 Division American Funds Insurance Series Managed Risk Growth Fund Class P2 Division American Funds Insurance Series Managed Risk International Fund Class P2 Division
American Funds Insurance Series New World Fund Class 2 Division American Funds Insurance Series New World Fund Class 4 Division BlackRock 60/40 Target Allocation Class III Division (1) BlackRock Advantage U.S. Total Market Class III Division
BlackRock Global Allocation Class III Division BNY Mellon IP MidCap Stock Service Shares Division (2) BNY Mellon IP Technology Growth Service Shares Division (3) Calvert EAFE International Index Class F Division
Calvert Russell 2000 Small Cap Index Class F Division Calvert S&P MidCap 400 Index Class F Division ClearBridge Small Cap Growth Class II Division
Columbia Limited Duration Credit Class 2 Division Columbia Small Cap Value Class 2 Division Core Plus Bond Class 1 Division Delaware Limited Term Diversified Income Service Class Division
Delaware Small Cap Value Service Class Division Diversified Balanced Class 1 Division Diversified Balanced Class 2 Division Diversified Balanced Managed Volatility Class 2 Division
Diversified Balanced Volatility Control Class 2 Division Diversified Growth Class 2 Division Diversified Growth Managed Volatility Class 2 Division Diversified Growth Volatility Control Class 2 Division
Diversified Income Class 2 Division Diversified International Class 1 Division DWS Alternative Asset Allocation Class B Division DWS Equity 500 Index Class B2 Division
DWS Small Mid Cap Value Class B Division

A-3

Equity Income Class 1 Division

Equity Income Class 2 Division

Fidelity VIP Contrafund Service Class Division

Fidelity VIP Contrafund Service Class 2 Division

Fidelity VIP Equity-Income Service Class 2 Division

Fidelity VIP Government Money Market Initial Class Division

Fidelity VIP Government Money Market Service Class 2 Division

Fidelity VIP Growth Service Class Division

Fidelity VIP Growth Service Class 2 Division

Fidelity VIP Mid Cap Service Class Division

Fidelity VIP Mid Cap Service Class 2 Division

Fidelity VIP Overseas Service Class 2 Division

Franklin Global Real Estate VIP Class 2 Division

Franklin Rising Dividends VIP Class 4 Division

Franklin Small Cap Value VIP Class 2 Division

Goldman Sachs VIT Mid Cap Value Institutional Shares Division

Goldman Sachs VIT Mid Cap Value Service Shares Division

Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares Division

Goldman Sachs VIT Small Cap Equity Insights Institutional Shares Division

Goldman Sachs VIT Small Cap Equity Insights Service Shares Division

Government & High Quality Bond Class 1 Division

Guggenheim Floating Rate Strategies Series F Division

Guggenheim Investments Global Managed Futures Strategy Division

Guggenheim Investments Long Short Equity Division

Guggenheim Investments Multi-Hedge Strategies Division

International Emerging Markets Class 1 Division

Invesco American Franchise Series I Division

Invesco Balanced-Risk Allocation Series II Division

Invesco Core Equity Series I Division

Invesco Health Care Series I Division

Invesco Health Care Series II Division

Invesco International Growth Series I Division

Invesco International Growth Series II Division

Invesco Mid Cap Growth Series I Division

Invesco Oppenheimer V.I. Main Street Small Cap Series II Division (4)

Invesco Small Cap Equity Series I Division

Invesco Technology Series I Division

Invesco Value Opportunities Series I Division

Janus Henderson Enterprise Service Shares Division

Janus Henderson Flexible Bond Service Shares Division

LargeCap Growth I Class 1 Division

LargeCap S&P 500 Index Class 1 Division

LargeCap S&P 500 Index Class 2 Division

MFS International Intrinsic Value Service Class Division (5)

MFS New Discovery Service Class Division

MFS Utilities Service Class Division

MFS Value Service Class Division

MidCap Class 1 Division

Neuberger Berman AMT Mid Cap Growth Portfolio Class S Division

Neuberger Berman AMT Sustainable Equity Class I Division

PIMCO All Asset Administrative Class Division

PIMCO All Asset Advisor Class Division

PIMCO Commodity Real Return Strategy M Class Division

PIMCO High Yield Administrative Class Division

A-4

PIMCO Low Duration Advisor Class Division PIMCO Total Return Administrative Class Division Principal Capital Appreciation Class 1 Division Principal Capital Appreciation Class 2 Division
Principal LifeTime 2010 Class 1 Division Principal LifeTime 2020 Class 1 Division Principal LifeTime 2030 Class 1 Division Principal LifeTime 2040 Class 1 Division
Principal LifeTime 2050 Class 1 Division Principal LifeTime Strategic Income Class 1 Division Real Estate Securities Class 1 Division Real Estate Securities Class 2 Division
Rydex Basic Materials Division Rydex Commodities Strategy Division Rydex NASDAQ 100 Division SAM Balanced Portfolio Class 1 Division
SAM Balanced Portfolio Class 2 Division SAM Conservative Balanced Portfolio Class 1 Division SAM Conservative Balanced Portfolio Class 2 Division SAM Conservative Growth Portfolio Class 1 Division
SAM Conservative Growth Portfolio Class 2 Division SAM Flexible Income Portfolio Class 1 Division SAM Flexible Income Portfolio Class 2 Division SAM Strategic Growth Portfolio Class 1 Division
SAM Strategic Growth Portfolio Class 2 Division Short-Term Income Class 1 Division SmallCap Class 1 Division SmallCap Class 2 Division
T. Rowe Price Blue Chip Growth Portfolio II Division T. Rowe Price Health Sciences Portfolio II Division Templeton Global Bond VIP Class 4 Division Templeton Growth VIP Class 2 Division
The Merger Fund Division
VanEck Global Hard Assets Class S Division
EQ Convertible Securities Class IB Division EQ GAMCO Small Company Value Class IB Division EQ Micro Cap Class IB Division EQ SmartBeta Equity Class IB Division EQ Socially Responsible Class IB Division Fidelity VIP Freedom 2020 Service Class 2 Division Fidelity VIP Freedom 2030 Service Class 2 Division Fidelity VIP Freedom 2040 Service Class 2 Division Fidelity VIP Freedom 2050 Service Class 2 Division Franklin U.S. Government Fund Class 2 Division Janus Henderson Global Technology Service Shares Division	For the period from June 7, 2019 (commencement of operations) through December 31, 2019

A-5

Calvert Investment Grade Bond Portfolio Class F Division Franklin Income VIP Class 4 Division Neuberger Berman AMT Sustainable Equity Class S Division TOPS Aggressive Growth ETF Portfolio Investor Class Division TOPS Balanced ETF Portfolio Investor Class Division TOPS Conservative ETF Portfolio Investor Class Division TOPS Growth ETF Portfolio Investor Class Division TOPS Moderate Growth ETF Portfolio Investor Class Division	For the year ended December 31, 2019	For the year ended December 31, 2019 and the period from June 11, 2018 (commencement of operations) through December 31, 2018
(1) Represented the operations of BlackRock iShares Dynamic Allocation Class III Division until June 6, 2019. (2) Represented the operations of Dreyfus IP MidCap Stock Service Shares Division until June 2, 2019. (3) Represented the operations of Dreyfus IP Technology Growth Service Shares Division until June 2, 2019. (4) Represented the operations of Oppenheimer Main Street Small Cap Service Shares Division until May 24, 2019. (5) Represented the operations of MFS International Value Service Class Division until June 6, 2019.

A-6

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		AllianceBernstein Small Cap Growth Class A Division		AllianceBernstein Small/Mid Cap Value Class A Division		Alps/Red Rocks Listed Private Equity Class III Division		American Century VP Capital Appreciation Class I Division
Assets
Investments in shares of mutual funds, at fair value		$	4,548,893	$	4,879,162	$	527,254	$	1,666,093
Total assets			4,548,893		4,879,162		527,254		1,666,093
Total liabilities			—		—		—		—
Net assets		$	4,548,893	$	4,879,162	$	527,254	$	1,666,093
Net assets
Applicable to accumulation units		$	4,548,893	$	4,879,162	$	527,254	$	1,666,093
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	4,548,893	$	4,879,162	$	527,254	$	1,666,093
Investments in shares of mutual funds, at cost		$	3,653,539	$	5,235,837	$	452,014	$	1,472,461
Shares of mutual funds owned			228,358		272,427		34,439		104,392
Accumulation units outstanding			99,603		315,018		41,622		100,483
Annuitized units outstanding			—		—		—		—
Total units outstanding			99,603		315,018		41,622		100,483
Statements of Operations
Year ended December 31, 2019
		AllianceBernstein Small Cap Growth Class A Division		AllianceBernstein Small/Mid Cap Value Class A Division		Alps/Red Rocks Listed Private Equity Class III Division		American Century VP Capital Appreciation Class I Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	27,316	$	—	$	—
Expenses:
	Mortality and expense risks		62,141		58,219		2,689		24,685
	Administrative charges		7,458		6,769		539		2,963
	Separate account rider charges		2,335		4,174		—		118
Net investment income (loss)			(71,934)		(41,846)		(3,228)		(27,766)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(66,541)		1,222		1,342		7,256
Capital gains distributions			606,000		509,704		5,655		360,638
Total realized gains (losses) on investments			539,459		510,926		6,997		367,894
Change in net unrealized appreciation (depreciation)
	of investments		981,251		290,994		110,089		244,068
Net gains (losses) on investments			1,448,776		760,074		113,858		584,196
Net increase (decrease) in net assets resulting from operations		$	1,448,776	$	760,074	$	113,858	$	584,196
See accompanying notes.

A-7

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		American Century VP Income & Growth Class I Division		American Century VP Inflation Protection Class II Division		American Century VP Mid Cap Value Class II Division		American Century VP Ultra Class I Division
Assets
Investments in shares of mutual funds, at fair value		$	9,811,230	$	32,718,900	$	9,130,144	$	3,723,090
Total assets			9,811,230		32,718,900		9,130,144		3,723,090
Total liabilities			—		—		—		—
Net assets		$	9,811,230	$	32,718,900	$	9,130,144	$	3,723,090
Net assets
Applicable to accumulation units		$	9,811,230	$	32,718,900	$	9,130,144	$	3,723,090
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	9,811,230	$	32,718,900	$	9,130,144	$	3,723,090
Investments in shares of mutual funds, at cost		$	8,372,290	$	32,626,208	$	8,673,590	$	2,941,868
Shares of mutual funds owned			979,165		3,188,977		441,070		177,883
Accumulation units outstanding			393,652		2,413,770		340,613		127,216
Annuitized units outstanding			—		—		—		—
Total units outstanding			393,652		2,413,770		340,613		127,216
Statements of Operations
Year ended December 31, 2019
		American Century VP Income & Growth Class I Division		American Century VP Inflation Protection Class II Division		American Century VP Mid Cap Value Class II Division		American Century VP Ultra Class I Division
Net investment income (loss)
Investment income:
	Dividends	$	198,118	$	778,756	$	166,007	$	—
Expenses:
	Mortality and expense risks		110,445		424,119		108,862		47,717
	Administrative charges		3,518		51,008		12342		1,909
	Separate account rider charges		0		502		5193		0
Net investment income (loss)			84,155		303,127		39,610		(49,626)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			685,394		(524,818)		(4,368)		472,061
Capital gains distributions			832,685		0		918,251		410,089
Total realized gains (losses) on investments			1,518,079		(524,818)		913,883		882,150
Change in net unrealized appreciation (depreciation)
	of investments		331,794		2,697,738		1,096,939		213,258
Net gains (losses) on investments			1,934,028		2,476,047		2,050,432		1,045,782
Net increase (decrease) in net assets resulting from operations		$	1,934,028	$	2,476,047	$	2,050,432	$	1,045,782
See accompanying notes.

A-8

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		American Century VP Ultra Class II Division		American Century VP Value Class II Division		American Funds Insurance Series Asset Allocation Fund Class 2 Division		American Funds Insurance Series Asset Allocation Fund Class 4 Division
Assets
Investments in shares of mutual funds, at fair value		$	26,467,436	$	14,004,030	$	2,711,263	$	8,179,899
Total assets			26,467,436		14,004,030		2,711,263		8,179,899
Total liabilities			—		—		—		—
Net assets		$	26,467,436	$	14,004,030	$	2,711,263	$	8,179,899
Net assets
Applicable to accumulation units		$	26,467,436	$	14,004,030	$	2,711,263	$	8,179,899
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	26,467,436	$	14,004,030	$	2,711,263	$	8,179,899
Investments in shares of mutual funds, at cost		$	20,705,744	$	8,449,096	$	2,577,608	$	7,867,175
Shares of mutual funds owned			1,292,355		1,192,848		113,966		345,581
Accumulation units outstanding			780,422		544,093		199,089		687,298
Annuitized units outstanding			—		—		—		—
Total units outstanding			780,422		544,093		199,089		687,298
Statements of Operations
Year ended December 31, 2019
		American Century VP Ultra Class II Division		American Century VP Value Class II Division		American Funds Insurance Series Asset Allocation Fund Class 2 Division		American Funds Insurance Series Asset Allocation Fund Class 4 Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	260,704	$	51,102	$	116,175
Expenses:
	Mortality and expense risks		343,049		165,135		33,858		44,042
	Administrative charges		41,171		7,836		3,731		8,270
	Separate account rider charges		3,781		—		5,357		—
Net investment income (loss)			(388,001)		87,733		8,156		63,863
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			3,732,834		913,814		18,105		51,610
Capital gains distributions			3,151,946		779,679		137,680		236,875
Total realized gains (losses) on investments			6,884,780		1,693,493		155,785		288,485
Change in net unrealized appreciation (depreciation)
	of investments		1,259,749		1,236,399		304,219		610,593
Net gains (losses) on investments			7,756,528		3,017,625		468,160		962,941
Net increase (decrease) in net assets resulting from operations		$	7,756,528	$	3,017,625	$	468,160	$	962,941
See accompanying notes.

A-9

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		American Funds Insurance Series Blue Chip Income and Growth Class 2 Division		American Funds Insurance Series Blue Chip Income and Growth Class 4 Division		American Funds Insurance Series Global Small Capitalization Fund Class 2 Division		American Funds Insurance Series Global Small Capitalization Fund Class 4 Division
Assets
Investments in shares of mutual funds, at fair value		$	3,398,913	$	6,584,481	$	1,573,419	$	1,433,725
Total assets			3,398,913		6,584,481		1,573,419		1,433,725
Total liabilities			—		—		—		—
Net assets		$	3,398,913	$	6,584,481	$	1,573,419	$	1,433,725
Net assets
Applicable to accumulation units		$	3,398,913	$	6,584,481	$	1,573,419	$	1,433,725
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	3,398,913	$	6,584,481	$	1,573,419	$	1,433,725
Investments in shares of mutual funds, at cost		$	3,473,781	$	6,562,298	$	1,375,056	$	1,304,361
Shares of mutual funds owned			253,840		494,702		60,470		54,806
Accumulation units outstanding			245,566		554,400		120,775		117,268
Annuitized units outstanding			—		—		—		—
Total units outstanding			245,566		554,400		120,775		117,268
Statements of Operations
Year ended December 31, 2019
		American Funds Insurance Series Blue Chip Income and Growth Class 2 Division		American Funds Insurance Series Blue Chip Income and Growth Class 4 Division		American Funds Insurance Series Global Small Capitalization Fund Class 2 Division		American Funds Insurance Series Global Small Capitalization Fund Class 4 Division
Net investment income (loss)
Investment income:
	Dividends	$	63939	$	112,403	$	2,331	$	83
Expenses:
	Mortality and expense risks		39,354		38,873		18,631		8,159
	Administrative charges		4,127		7,398		1,775		1,586
	Separate account rider charges		4,742		—		757		—
Net investment income (loss)			15,716		66,132		-18,832		-9,662
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(42,973)		(20,439)		3,197		1,760
Capital gains distributions			254,342		380,587		96,609		62,618
Total realized gains (losses) on investments			211,369		360,148		99,806		64,378
Change in net unrealized appreciation (depreciation)
	of investments		328,167		480,315		300,967		206,083
Net gains (losses) on investments			555,252		906,595		381,941		260,799
Net increase (decrease) in net assets resulting from operations		$	555,252	$	906,595	$	381,941	$	260,799
See accompanying notes.

A-10

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		American Funds Insurance Series High-Income Bond Class 2 Division		American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2 Division		American Funds Insurance Series Managed Risk Growth Fund Class P2 Division		American Funds Insurance Series Managed Risk International Fund Class P2 Division
Assets
Investments in shares of mutual funds, at fair value		$	1,237,229	$	2,153,368	$	2,093,014	$	200,535
Total assets			1,237,229		2,153,368		2,093,014		200,535
Total liabilities			—		—		—		—
Net assets		$	1,237,229	$	2,153,368	$	2,093,014	$	200,535
Net assets
Applicable to accumulation units		$	1,237,229	$	2,153,368	$	2,093,014	$	200,535
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,237,229	$	2,153,368	$	2,093,014	$	200,535
Investments in shares of mutual funds, at cost		$	1,286,658	$	2,059,175	$	1,951,811	$	192,288
Shares of mutual funds owned			127,549		159,983		152,663		18,364
Accumulation units outstanding			106,316		184,160		162,555		17,453
Annuitized units outstanding			—		—		—		—
Total units outstanding			106,316		184,160		162,555		17,453
Statements of Operations
Year ended December 31, 2019
		American Funds Insurance Series High-Income Bond Class 2 Division		American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2 Division		American Funds Insurance Series Managed Risk Growth Fund Class P2 Division		American Funds Insurance Series Managed Risk International Fund Class P2 Division
Net investment income (loss)
Investment income:
	Dividends	$	77042	$	34,475	$	15,874	$	2,812
Expenses:
	Mortality and expense risks		15,924		12,899		14,197		1,505
	Administrative charges		637		2,386		2,733		251
	Separate account rider charges		0		—		0		—
Net investment income (loss)			60,481		19,190		(1,056)		1,056
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(13,107)		(415)		2,079		102
Capital gains distributions			0		63,243		125,230		5,358
Total realized gains (losses) on investments			(13,107)		62,828		127,309		5,460
Change in net unrealized appreciation (depreciation)
	of investments		84,089		161,896		211,306		18,281
Net gains (losses) on investments			131,463		243,914		337,559		24,797
Net increase (decrease) in net assets resulting from operations		$	131,463	$	243,914	$	337,559	$	24,797
See accompanying notes.

A-11

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		American Funds Insurance Series New World Fund Class 2 Division		American Funds Insurance Series New World Fund Class 4 Division		BlackRock 60/40 Target Allocation Class III Division (1)		BlackRock Advantage U.S. Total Market Class III Division
Assets
Investments in shares of mutual funds, at fair value		$	1,786,844	$	2,183,210	$	799,242	$	1,002,094
Total assets			1,786,844		2,183,210		799,242		1,002,094
Total liabilities			—		—		—		—
Net assets		$	1,786,844	$	2,183,210	$	799,242	$	1,002,094
Net assets
Applicable to accumulation units		$	1,786,844	$	2,183,210	$	799,242	$	1,002,094
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,786,844	$	2,183,210	$	799,242	$	1,002,094
Investments in shares of mutual funds, at cost		$	1,629,473	$	1,975,379	$	740,746	$	1,103,410
Shares of mutual funds owned			69,826		85,717		65,944		61,365
Accumulation units outstanding			141,002		189,190		68,378		76,411
Annuitized units outstanding			—		—		—		—
Total units outstanding			141,002		189,190		68,378		76,411
Statements of Operations
Year ended December 31, 2019
		American Funds Insurance Series New World Fund Class 2 Division		American Funds Insurance Series New World Fund Class 4 Division		BlackRock 60/40 Target Allocation Class III Division (1)		BlackRock Advantage U.S. Total Market Class III Division
Net investment income (loss)
Investment income:
	Dividends	$	15,549	$	14,401	$	14,276	$	21,116
Expenses:
	Mortality and expense risks		19,685		12,252		4,590		7,623
	Administrative charges		1,905		2,288		829		1,446
	Separate account rider charges		432		—		317		—
Net investment income (loss)			(6,473)		(139)		8,540		12,047
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			46,192		3,086		9,949		(36,908)
Capital gains distributions			60,863		53,931		7,222		113,040
Total realized gains (losses) on investments			107,055		57,017		17,171		76,132
Change in net unrealized appreciation (depreciation)
	of investments		271,823		305,814		82,300		132,279
Net gains (losses) on investments			372,405		362,692		108,011		220,458
Net increase (decrease) in net assets resulting from operations		$	372,405	$	362,692	$	108,011	$	220,458
(1) Represented the operations of BlackRock iShares Dynamic Allocation Class III Division until June 6, 2019.
See accompanying notes.

A-12

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		BlackRock Global Allocation Class III Division		BNY Mellon IP MidCap Stock Service Shares Division (1)		BNY Mellon IP Technology Growth Service Shares Division (2)		Calvert EAFE International Index Class F Division
Assets
Investments in shares of mutual funds, at fair value		$	2,139,796	$	546,882	$	8,637,728	$	1,308,483
Total assets			2,139,796		546,882		8,637,728		1,308,483
Total liabilities			—		—		—		—
Net assets		$	2,139,796	$	546,882	$	8,637,728	$	1,308,483
Net assets
Applicable to accumulation units		$	2,139,796	$	546,882	$	8,637,728	$	1,308,483
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	2,139,796	$	546,882	$	8,637,728	$	1,308,483
Investments in shares of mutual funds, at cost		$	2,050,166	$	575,877	$	7,343,726	$	1,262,365
Shares of mutual funds owned			147,776		29,513		365,541		14,532
Accumulation units outstanding			191,568		49,716		212,729		126,237
Annuitized units outstanding			—		—		—		—
Total units outstanding			191,568		49,716		212,729		126,237
Statements of Operations
Year ended December 31, 2019
		BlackRock Global Allocation Class III Division		BNY Mellon IP MidCap Stock Service Shares Division (1)		BNY Mellon IP Technology Growth Service Shares Division (2)		Calvert EAFE International Index Class F Division
Net investment income (loss)
Investment income:
	Dividends	$	26,036	$	1,940	$	—	$	27,731
Expenses:
	Mortality and expense risks		20,192		4,238		113,558		5,421
	Administrative charges		2,726		756		13,628		1,267
	Separate account rider charges		1,379		—		5,855		—
Net investment income (loss)			1,739		(3,054)		(133,041)		21,043
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,139		(6,319)		556,806		185
Capital gains distributions			79,588		35,182		1,168,054		—
Total realized gains (losses) on investments			80,727		28,863		1,724,860		185
Change in net unrealized appreciation (depreciation)
	of investments		192,061		56,114		329,247		128,980
Net gains (losses) on investments			274,527		81,923		1,921,066		150,208
Net increase (decrease) in net assets resulting from operations		$	274,527	$	81,923	$	1,921,066	$	150,208
(1) Represented the operations of Dreyfus IP MidCap Stock Service Shares Division until June 2, 2019.
(2) Represented the operations of Dreyfus IP Technology Growth Service Shares Division until June 2, 2019.
See accompanying notes.

A-13

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Calvert Investment Grade Bond Portfolio Class F Division		Calvert Russell 2000 Small Cap Index Class F Division		Calvert S&P MidCap 400 Index Class F Division		ClearBridge Small Cap Growth Class II Division
Assets
Investments in shares of mutual funds, at fair value		$	943,274	$	2,707,946	$	4,488,888	$	2,018,227
Total assets			943,274		2,707,946		4,488,888		2,018,227
Total liabilities			—		—		—		—
Net assets		$	943,274	$	2,707,946	$	4,488,888	$	2,018,227
Net assets
Applicable to accumulation units		$	943,274	$	2,707,946	$	4,488,888	$	2,018,227
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	943,274	$	2,707,946	$	4,488,888	$	2,018,227
Investments in shares of mutual funds, at cost		$	949,793	$	2,744,513	$	4,454,360	$	2,062,546
Shares of mutual funds owned			17,160		33,568		39,955		77,297
Accumulation units outstanding			86,794		235,609		375,505		157,109
Annuitized units outstanding			—		—		—		—
Total units outstanding			86,794		235,609		375,505		157,109
Statements of Operations
Year ended December 31, 2019
		Calvert Investment Grade Bond Portfolio Class F Division		Calvert Russell 2000 Small Cap Index Class F Division		Calvert S&P MidCap 400 Index Class F Division		ClearBridge Small Cap Growth Class II Division
Net investment income (loss)
Investment income:
	Dividends	$	23,534	$	21,258	$	44,075	$	—
Expenses:
	Mortality and expense risks		2,710		15,433		27,751		11,108
	Administrative charges		671		3,089		5,115		2,328
	Separate account rider charges		—		—		—		—
Net investment income (loss)			20,153		2,736		11,209		(13,436)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,867		(13,593)		(7,714)		8,742
Capital gains distributions			—		175,581		264,221		178,699
Total realized gains (losses) on investments			1,867		161,988		256,507		187,441
Change in net unrealized appreciation (depreciation)
	of investments		(4,096)		246,207		420,984		140,223
Net gains (losses) on investments			17,924		410,931		688,700		314,228
Net increase (decrease) in net assets resulting from operations		$	17,924	$	410,931	$	688,700	$	314,228
See accompanying notes.

A-14

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Columbia Limited Duration Credit Class 2 Division		Columbia Small Cap Value Class 2 Division		Core Plus Bond Class 1 Division		Delaware Limited Term Diversified Income Service Class Division
Assets
Investments in shares of mutual funds, at fair value		$	404,751	$	1,033,855	$	116,174,195	$	475,876
Total assets			404,751		1,033,855		116,174,195		475,876
Total liabilities			—		—		—		—
Net assets		$	404,751	$	1,033,855	$	116,174,195	$	475,876
Net assets
Applicable to accumulation units		$	404,751	$	1,033,855	$	116,174,195	$	475,876
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	404,751	$	1,033,855	$	116,174,195	$	475,876
Investments in shares of mutual funds, at cost		$	394,951	$	1,103,779	$	112,858,787	$	474,241
Shares of mutual funds owned			41,641		66,486		10,102,104		48,807
Accumulation units outstanding			38,559		94,994		5,336,883		46,511
Annuitized units outstanding			—		—		—		—
Total units outstanding			38,559		94,994		5,336,883		46,511
Statements of Operations
Year ended December 31, 2019
		Columbia Limited Duration Credit Class 2 Division		Columbia Small Cap Value Class 2 Division		Core Plus Bond Class 1 Division		Delaware Limited Term Diversified Income Service Class Division
Net investment income (loss)
Investment income:
	Dividends	$	5,625	$	2,100	$	3,694,346	$	9,270
Expenses:
	Mortality and expense risks		2,805		6,460		1,377,910		4,118
	Administrative charges		383		1,146		113,372		463
	Separate account rider charges		74		—		22,901		88
Net investment income (loss)			2,363		(5,506)		2,180,163		4,601
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,134		(16,730)		1,285,718		(704)
Capital gains distributions			—		68,599		—		—
Total realized gains (losses) on investments			1,134		51,869		1,285,718		(704)
Change in net unrealized appreciation (depreciation)
	of investments		12,508		100,412		5,630,180		8,999
Net gains (losses) on investments			16,005		146,775		9,096,061		12,896
Net increase (decrease) in net assets resulting from operations		$	16,005	$	146,775	$	9,096,061	$	12,896
See accompanying notes.

A-15

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Delaware Small Cap Value Service Class Division		Diversified Balanced Class 1 Division		Diversified Balanced Class 2 Division		Diversified Balanced Managed Volatility Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	2,562,571	$	24,944,021	$	988,423,394	$	176,257,628
Total assets			2,562,571		24,944,021		988,423,394		176,257,628
Total liabilities			—		—		—		—
Net assets		$	2,562,571	$	24,944,021	$	988,423,394	$	176,257,628
Net assets
Applicable to accumulation units		$	2,562,571	$	24,944,021	$	988,423,394	$	176,257,628
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	2,562,571	$	24,944,021	$	988,423,394	$	176,257,628
Investments in shares of mutual funds, at cost		$	2,609,175	$	23,500,338	$	818,855,744	$	152,964,814
Shares of mutual funds owned			67,330		1,509,928		59,723,468		13,652,799
Accumulation units outstanding			160,042		2,111,666		55,108,936		13,367,376
Annuitized units outstanding			—		—		—		—
Total units outstanding			160,042		2,111,666		55,108,936		13,367,376
Statements of Operations
Year ended December 31, 2019
		Delaware Small Cap Value Service Class Division		Diversified Balanced Class 1 Division		Diversified Balanced Class 2 Division		Diversified Balanced Managed Volatility Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	19,131	$	511,715	$	18,026,426	$	2,781,663
Expenses:
	Mortality and expense risks		30,358		282,134		12,424,614		2,139,653
	Administrative charges		3,330		10,772		1,491,128		256,524
	Separate account rider charges		1,972		—		376,673		65,584
Net investment income (loss)			(16,529)		218,809		3,734,011		319,902
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(559)		107,604		43,637,197		3,011,773
Capital gains distributions			197,272		1,009,930		40,863,423		2,553,107
Total realized gains (losses) on investments			196,713		1,117,534		84,500,620		5,564,880
Change in net unrealized appreciation (depreciation)
	of investments		359,207		2,439,137		63,569,257		19,144,577
Net gains (losses) on investments			539,391		3,775,480		151,803,888		25,029,359
Net increase (decrease) in net assets resulting from operations		$	539,391	$	3,775,480	$	151,803,888	$	25,029,359
See accompanying notes.

A-16

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Diversified Balanced Volatility Control Class 2 Division		Diversified Growth Class 2 Division		Diversified Growth Managed Volatility Class 2 Division		Diversified Growth Volatility Control Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	145,328,454	$	3,772,917,463	$	353,685,077	$	765,294,482
Total assets			145,328,454		3,772,917,463		353,685,077		765,294,482
Total liabilities			—		—		—		—
Net assets		$	145,328,454	$	3,772,917,463	$	353,685,077	$	765,294,482
Net assets
Applicable to accumulation units		$	145,328,454	$	3,772,917,463	$	353,685,077	$	765,294,482
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	145,328,454	$	3,772,917,463	$	353,685,077	$	765,294,482
Investments in shares of mutual funds, at cost		$	135,353,134	$	2,959,728,131	$	296,217,030	$	701,344,581
Shares of mutual funds owned			12,410,628		201,868,243		26,140,804		63,774,540
Accumulation units outstanding			12,526,691		188,482,525		25,503,108		64,303,186
Annuitized units outstanding			—		—		—		—
Total units outstanding			12,526,691		188,482,525		25,503,108		64,303,186
Statements of Operations
Year ended December 31, 2019
		Diversified Balanced Volatility Control Class 2 Division		Diversified Growth Class 2 Division		Diversified Growth Managed Volatility Class 2 Division		Diversified Growth Volatility Control Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	1,009,551	$	64,821,603	$	5,363,155	$	5,625,531
Expenses:
	Mortality and expense risks		1,273,625		46,308,837		4,298,559		7,022,339
	Administrative charges		152,853		5,557,709		520,251		842,779
	Separate account rider charges		—		996,538		138,311		—
Net investment income (loss)			(416,927)		11,958,519		406,034		(2,239,587)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			336,055		162,444,860		7,070,338		700,021
Capital gains distributions			990,341		133,401,553		5,278,820		4,664,526
Total realized gains (losses) on investments			1,326,396		295,846,413		12,349,158		5,364,547
Change in net unrealized appreciation (depreciation)
	of investments		11,807,300		345,786,028		45,499,580		78,184,013
Net gains (losses) on investments			12,716,769		653,590,960		58,254,772		81,308,973
Net increase (decrease) in net assets resulting from operations		$	12,716,769	$	653,590,960	$	58,254,772	$	81,308,973
See accompanying notes.

A-17

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Diversified Income Class 2 Division		Diversified International Class 1 Division		DWS Alternative Asset Allocation Class B Division		DWS Equity 500 Index Class B2 Division
Assets
Investments in shares of mutual funds, at fair value		$	279,863,718	$	103,483,807	$	44,280	$	2,490,658
Total assets			279,863,718		103,483,807		44,280		2,490,658
Total liabilities			—		—		—		—
Net assets		$	279,863,718	$	103,483,807	$	44,280	$	2,490,658
Net assets
Applicable to accumulation units		$	279,863,718	$	103,483,807	$	44,280	$	2,490,658
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	279,863,718	$	103,483,807	$	44,280	$	2,490,658
Investments in shares of mutual funds, at cost		$	256,121,450	$	82,035,915	$	42,964	$	2,186,197
Shares of mutual funds owned			20,250,631		6,587,129		3,319		107,634
Accumulation units outstanding			20,567,245		3,881,846		4,408		174,629
Annuitized units outstanding			—		—		—		—
Total units outstanding			20,567,245		3,881,846		4,408		174,629
Statements of Operations
Year ended December 31, 2019
		Diversified Income Class 2 Division		Diversified International Class 1 Division		DWS Alternative Asset Allocation Class B Division		DWS Equity 500 Index Class B2 Division
Net investment income (loss)
Investment income:
	Dividends	$	4,384,707	$	1,661,004	$	1,503	$	32,673
Expenses:
	Mortality and expense risks		3,302,783		1,238,188		503		19,958
	Administrative charges		396,380		80,066		65		3,273
	Separate account rider charges		64,204		4,038		—		—
Net investment income (loss)			621,340		338,712		935		9,442
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			5,232,420		4,697,678		(55)		6,313
Capital gains distributions			5,779,031		5,003,662		—		100,999
Total realized gains (losses) on investments			11,011,451		9,701,340		(55)		107,312
Change in net unrealized appreciation (depreciation)
	of investments		21,449,329		9,270,883		4,066		419,422
Net gains (losses) on investments			33,082,120		19,310,935		4,946		536,176
Net increase (decrease) in net assets resulting from operations		$	33,082,120	$	19,310,935	$	4,946	$	536,176
See accompanying notes.

A-18

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		DWS Small Mid Cap Value Class B Division		EQ Convertible Securities Class IB Division (1)		EQ GAMCO Small Company Value Class IB Division (1)		EQ Micro Cap Class IB Division (1)
Assets
Investments in shares of mutual funds, at fair value		$	1,469,414	$	—	$	55,294	$	10,480
Total assets			1,469,414		—		55,294		10,480
Total liabilities			—		—		—		—
Net assets		$	1,469,414	$	—	$	55,294	$	10,480
Net assets
Applicable to accumulation units		$	1,469,414	$	—	$	55,294	$	10,480
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,469,414	$	—	$	55,294	$	10,480
Investments in shares of mutual funds, at cost		$	1,588,555	$	—	$	54,354	$	10,889
Shares of mutual funds owned			107,492		—		923		999
Accumulation units outstanding			117,871		—		5,085		958
Annuitized units outstanding			—		—		—		—
Total units outstanding			117,871		—		5,085		958
Statements of Operations
Year ended December 31, 2019
		DWS Small Mid Cap Value Class B Division		EQ Convertible Securities Class IB Division (1)		EQ GAMCO Small Company Value Class IB Division (1)		EQ Micro Cap Class IB Division (1)
Net investment income (loss)
Investment income:
	Dividends	$	4,688	$	—	$	314	$	13
Expenses:
	Mortality and expense risks		14,126		—		88		25
	Administrative charges		1,815		—		22		6
	Separate account rider charges		668		—		—		—
Net investment income (loss)			(11,921)		—		204		(18)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(55,764)		—		2		(3)
Capital gains distributions			93,472		—		1,279		968
Total realized gains (losses) on investments			37,708		—		1,281		965
Change in net unrealized appreciation (depreciation)
	of investments		193,594		—		940		(410)
Net gains (losses) on investments			219,381		—		2,425		537
Net increase (decrease) in net assets resulting from operations		$	219,381	$	—	$	2,425	$	537
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-19

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		EQ SmartBeta Equity Class IB Division (1)		EQ Socially Responsible Class IB Division (1)		Equity Income Class 1 Division		Equity Income Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	62,178	$	16,581	$	229,474,830	$	7,664,804
Total assets			62,178		16,581		229,474,830		7,664,804
Total liabilities			—		—		—		—
Net assets		$	62,178	$	16,581	$	229,474,830	$	7,664,804
Net assets
Applicable to accumulation units		$	62,178	$	16,581	$	229,328,786	$	7,664,804
Applicable to contracts in annuitization period			—		—		146,044		—
Total net assets		$	62,178	$	16,581	$	229,474,830	$	7,664,804
Investments in shares of mutual funds, at cost		$	60,578	$	15,749	$	180,253,125	$	6,878,307
Shares of mutual funds owned			4,312		1,188		8,140,292		274,429
Accumulation units outstanding			5,747		1,475		11,621,816		573,202
Annuitized units outstanding			—		—		12,234		—
Total units outstanding			5,747		1,475		11,634,050		573,202
Statements of Operations
Year ended December 31, 2019
		EQ SmartBeta Equity Class IB Division (1)		EQ Socially Responsible Class IB Division (1)		Equity Income Class 1 Division		Equity Income Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	653	$	130	$	4,268,738	$	101,959
Expenses:
	Mortality and expense risks		230		36		2,802,412		48,229
	Administrative charges		23		9		240,850		8,555
	Separate account rider charges		—		—		17,119		—
Net investment income (loss)			400		85		1,208,357		45,175
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(2)		1		17,099,538		11,995
Capital gains distributions			783		230		5,972,915		162,461
Total realized gains (losses) on investments			781		231		23,072,453		174,456
Change in net unrealized appreciation (depreciation)
	of investments		1,599		832		30,640,488		1,124,305
Net gains (losses) on investments			2,780		1,148		54,921,298		1,343,936
Net increase (decrease) in net assets resulting from operations		$	2,780	$	1,148	$	54,921,298	$	1,343,936
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-20

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Fidelity VIP Contrafund Service Class Division		Fidelity VIP Contrafund Service Class 2 Division		Fidelity VIP Equity-Income Service Class 2 Division		Fidelity VIP Freedom 2020 Service Class 2 Division (1)
Assets
Investments in shares of mutual funds, at fair value		$	35,859,605	$	50,632,508	$	28,580,830	$	142,053
Total assets			35,859,605		50,632,508		28,580,830		142,053
Total liabilities			—		—		—		—
Net assets		$	35,859,605	$	50,632,508	$	28,580,830	$	142,053
Net assets
Applicable to accumulation units		$	35,859,605	$	50,632,508	$	28,580,830	$	142,053
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	35,859,605	$	50,632,508	$	28,580,830	$	142,053
Investments in shares of mutual funds, at cost		$	28,733,382	$	43,710,341	$	25,962,914	$	136,211
Shares of mutual funds owned			970,227		1,402,562		1,237,265		10,205
Accumulation units outstanding			990,426		1,832,502		1,165,471		13,201
Annuitized units outstanding			—		—		—		—
Total units outstanding			990,426		1,832,502		1,165,471		13,201
Statements of Operations
Year ended December 31, 2019
		Fidelity VIP Contrafund Service Class Division		Fidelity VIP Contrafund Service Class 2 Division		Fidelity VIP Equity-Income Service Class 2 Division		Fidelity VIP Freedom 2020 Service Class 2 Division (1)
Net investment income (loss)
Investment income:
	Dividends	$	123,553	$	104,516	$	495,979	$	2,430
Expenses:
	Mortality and expense risks		439,073		585,849		347,045		292
	Administrative charges		17,565		73,155		24,136		73
	Separate account rider charges		—		8,538		4,163		—
Net investment income (loss)			(333,085)		(563,026)		120,635		2,065
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,594,806		2,997,343		359,249		15
Capital gains distributions			4,139,903		5,710,060		1,844,605		570
Total realized gains (losses) on investments			5,734,709		8,707,403		2,203,854		585
Change in net unrealized appreciation (depreciation)
	of investments		3,690,848		4,283,215		3,877,696		5,842
Net gains (losses) on investments			9,092,472		12,427,592		6,202,185		8,492
Net increase (decrease) in net assets resulting from operations		$	9,092,472	$	12,427,592	$	6,202,185	$	8,492
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-21

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Fidelity VIP Freedom 2030 Service Class 2 Division (1)		Fidelity VIP Freedom 2040 Service Class 2 Division (1)		Fidelity VIP Freedom 2050 Service Class 2 Division (1)		Fidelity VIP Government Money Market Initial Class Division
Assets
Investments in shares of mutual funds, at fair value		$	298,182	$	719,516	$	177,737	$	31,462,445
Total assets			298,182		719,516		177,737		31,462,445
Total liabilities			—		—		—		—
Net assets		$	298,182	$	719,516	$	177,737	$	31,462,445
Net assets
Applicable to accumulation units		$	298,182	$	719,516	$	177,737	$	31,462,445
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	298,182	$	719,516	$	177,737	$	31,462,445
Investments in shares of mutual funds, at cost		$	294,341	$	693,065	$	172,839	$	31,462,442
Shares of mutual funds owned			19,630		31,351		8,641		31,462,446
Accumulation units outstanding			27,311		64,854		16,013		7,795,418
Annuitized units outstanding			—		—		—		—
Total units outstanding			27,311		64,854		16,013		7,795,418
Statements of Operations
Year ended December 31, 2019
		Fidelity VIP Freedom 2030 Service Class 2 Division (1)		Fidelity VIP Freedom 2040 Service Class 2 Division (1)		Fidelity VIP Freedom 2050 Service Class 2 Division (1)		Fidelity VIP Government Money Market Initial Class Division
Net investment income (loss)
Investment income:
	Dividends	$	4,755	$	9,693	$	1,880	$	697,720
Expenses:
	Mortality and expense risks		339		735		154		386,340
	Administrative charges		85		184		38		30,475
	Separate account rider charges		—		—		—		14,179
Net investment income (loss)			4,331		8,774		1,688		266,726
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			3,685		49		12		—
Capital gains distributions			653		1,118		591		—
Total realized gains (losses) on investments			4,338		1,167		603		—
Change in net unrealized appreciation (depreciation)
	of investments		3,841		26,451		4,898		—
Net gains (losses) on investments			12,510		36,392		7,189		266,726
Net increase (decrease) in net assets resulting from operations		$	12,510	$	36,392	$	7,189	$	266,726
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-22

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Fidelity VIP Government Money Market Service Class 2 Division		Fidelity VIP Growth Service Class Division		Fidelity VIP Growth Service Class 2 Division		Fidelity VIP Mid Cap Service Class Division
Assets
Investments in shares of mutual funds, at fair value		$	8,849,989	$	14,563,181	$	12,286,792	$	95,250
Total assets			8,849,989		14,563,181		12,286,792		95,250
Total liabilities			—		—		—		—
Net assets		$	8,849,989	$	14,563,181	$	12,286,792	$	95,250
Net assets
Applicable to accumulation units		$	8,849,989	$	14,563,181	$	12,286,792	$	95,250
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	8,849,989	$	14,563,181	$	12,286,792	$	95,250
Investments in shares of mutual funds, at cost		$	8,849,990	$	10,244,130	$	9,708,358	$	99,258
Shares of mutual funds owned			8,849,989		185,047		158,683		2,923
Accumulation units outstanding			880,129		544,846		346,351		6,677
Annuitized units outstanding			—		—		—		—
Total units outstanding			880,129		544,846		346,351		6,677
Statements of Operations
Year ended December 31, 2019
		Fidelity VIP Government Money Market Service Class 2 Division		Fidelity VIP Growth Service Class Division		Fidelity VIP Growth Service Class 2 Division		Fidelity VIP Mid Cap Service Class Division
Net investment income (loss)
Investment income:
	Dividends	$	143,313	$	23,074	$	6,418	$	718
Expenses:
	Mortality and expense risks		78,143		177,343		145,454		847
	Administrative charges		12,440		7,095		17,456		—
	Separate account rider charges		—		—		6,752		—
Net investment income (loss)			52,730		(161,364)		(163,244)		(129)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			—		1,381,827		496,156		(87)
Capital gains distributions			—		898,813		730,995		9,445
Total realized gains (losses) on investments			—		2,280,640		1,227,151		9,358
Change in net unrealized appreciation (depreciation)
	of investments		—		1,810,114		2,110,429		8,063
Net gains (losses) on investments			52,730		3,929,390		3,174,336		17,292
Net increase (decrease) in net assets resulting from operations		$	52,730	$	3,929,390	$	3,174,336	$	17,292
See accompanying notes.

A-23

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Fidelity VIP Mid Cap Service Class 2 Division		Fidelity VIP Overseas Service Class 2 Division		Franklin Global Real Estate VIP Class 2 Division		Franklin Income VIP Class 4 Division
Assets
Investments in shares of mutual funds, at fair value		$	25,934,340	$	23,490,425	$	1,397,210	$	1,252,718
Total assets			25,934,340		23,490,425		1,397,210		1,252,718
Total liabilities			—		—		—		—
Net assets		$	25,934,340	$	23,490,425	$	1,397,210	$	1,252,718
Net assets
Applicable to accumulation units		$	25,934,340	$	23,490,425	$	1,397,210	$	1,252,718
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	25,934,340	$	23,490,425	$	1,397,210	$	1,252,718
Investments in shares of mutual funds, at cost		$	26,238,919	$	18,724,856	$	1,309,195	$	1,224,636
Shares of mutual funds owned			816,830		1,025,783		79,840		76,760
Accumulation units outstanding			1,168,911		1,179,702		118,101		115,664
Annuitized units outstanding			—		—		—		—
Total units outstanding			1,168,911		1,179,702		118,101		115,664
Statements of Operations
Year ended December 31, 2019
		Fidelity VIP Mid Cap Service Class 2 Division		Fidelity VIP Overseas Service Class 2 Division		Franklin Global Real Estate VIP Class 2 Division		Franklin Income VIP Class 4 Division
Net investment income (loss)
Investment income:
	Dividends	$	167,860	$	342,947	$	23,927	$	29,835
Expenses:
	Mortality and expense risks		282,065		289,481		10,608		4,177
	Administrative charges		36,623		35,091		1,534		1,027
	Separate account rider charges		13,151		2,132		15		—
Net investment income (loss)			(163,979)		16,243		11,770		24,631
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(656,418)		1,867,805		4,757		84
Capital gains distributions			2,699,062		883,229		18,707		9,186
Total realized gains (losses) on investments			2,042,644		2,751,034		23,464		9,270
Change in net unrealized appreciation (depreciation)
	of investments		2,756,548		2,595,098		139,722		30,265
Net gains (losses) on investments			4,635,213		5,362,375		174,956		64,166
Net increase (decrease) in net assets resulting from operations		$	4,635,213	$	5,362,375	$	174,956	$	64,166
See accompanying notes.

A-24

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Franklin Rising Dividends VIP Class 4 Division		Franklin Small Cap Value VIP Class 2 Division		Franklin U.S. Government Fund Class 2 Division (1)		Goldman Sachs VIT Mid Cap Value Institutional Shares Division
Assets
Investments in shares of mutual funds, at fair value		$	2,841,969	$	4,044,350	$	322,631	$	11,835,201
Total assets			2,841,969		4,044,350		322,631		11,835,201
Total liabilities			—		—		—		—
Net assets		$	2,841,969	$	4,044,350	$	322,631	$	11,835,201
Net assets
Applicable to accumulation units		$	2,841,969	$	4,044,350	$	322,631	$	11,835,201
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	2,841,969	$	4,044,350	$	322,631	$	11,835,201
Investments in shares of mutual funds, at cost		$	2,740,682	$	4,522,061	$	322,309	$	11,853,101
Shares of mutual funds owned			104,947		268,727		26,774		729,667
Accumulation units outstanding			206,427		158,456		31,758		389,672
Annuitized units outstanding			—		—		—		—
Total units outstanding			206,427		158,456		31,758		389,672
Statements of Operations
Year ended December 31, 2019
		Franklin Rising Dividends VIP Class 4 Division		Franklin Small Cap Value VIP Class 2 Division		Franklin U.S. Government Fund Class 2 Division (1)		Goldman Sachs VIT Mid Cap Value Institutional Shares Division
Net investment income (loss)
Investment income:
	Dividends	$	23,272	$	41,481	$	—	$	88,993
Expenses:
	Mortality and expense risks		18,317		49,049		258		146,333
	Administrative charges		3,083		5,608		64		17,401
	Separate account rider charges		—		2,811		—		3,538
Net investment income (loss)			1,872		(15,987)		(322)		(78,279)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			6,238		(180,168)		11		(70,839)
Capital gains distributions			301,026		660,818		—		417,406
Total realized gains (losses) on investments			307,264		480,650		11		346,567
Change in net unrealized appreciation (depreciation)
	of investments		163,124		385,729		322		2,732,906
Net gains (losses) on investments			472,260		850,392		11		3,001,194
Net increase (decrease) in net assets resulting from operations		$	472,260	$	850,392	$	11	$	3,001,194
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-25

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Goldman Sachs VIT Mid Cap Value Service Shares Division		Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares Division		Goldman Sachs VIT Small Cap Equity Insights Institutional Shares Division		Goldman Sachs VIT Small Cap Equity Insights Service Shares Division
Assets
Investments in shares of mutual funds, at fair value		$	1,444,925	$	67,712	$	5,915,884	$	626,867
Total assets			1,444,925		67,712		5,915,884		626,867
Total liabilities			—		—		—		—
Net assets		$	1,444,925	$	67,712	$	5,915,884	$	626,867
Net assets
Applicable to accumulation units		$	1,444,925	$	67,712	$	5,915,884	$	626,867
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,444,925	$	67,712	$	5,915,884	$	626,867
Investments in shares of mutual funds, at cost		$	1,393,768	$	68,371	$	5,971,554	$	627,249
Shares of mutual funds owned			88,266		7,507		468,770		50,109
Accumulation units outstanding			118,801		6,663		226,447		52,205
Annuitized units outstanding			—		—		—		—
Total units outstanding			118,801		6,663		226,447		52,205
Statements of Operations
Year ended December 31, 2019
		Goldman Sachs VIT Mid Cap Value Service Shares Division		Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares Division		Goldman Sachs VIT Small Cap Equity Insights Institutional Shares Division		Goldman Sachs VIT Small Cap Equity Insights Service Shares Division
Net investment income (loss)
Investment income:
	Dividends	$	7,183	$	1,839	$	27,508	$	1,281
Expenses:
	Mortality and expense risks		8,617		417		74,770		3,705
	Administrative charges		1,407		89		8,722		688
	Separate account rider charges		—		—		2,039		—
Net investment income (loss)			(2,841)		1,333		(58,023)		(3,112)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(5,018)		(78)		(271,839)		(7,917)
Capital gains distributions			47,929		—		121,018		12,975
Total realized gains (losses) on investments			42,911		(78)		(150,821)		5,058
Change in net unrealized appreciation (depreciation)
	of investments		190,535		2,912		1,444,467		90,363
Net gains (losses) on investments			230,605		4,167		1,235,623		92,309
Net increase (decrease) in net assets resulting from operations		$	230,605	$	4,167	$	1,235,623	$	92,309
See accompanying notes.

A-26

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Government & High Quality Bond Class 1 Division		Guggenheim Floating Rate Strategies Series F Division		Guggenheim Investments Global Managed Futures Strategy Division		Guggenheim Investments Long Short Equity Division
Assets
Investments in shares of mutual funds, at fair value		$	81,189,558	$	3,212,995	$	178,140	$	144,280
Total assets			81,189,558		3,212,995		178,140		144,280
Total liabilities			—		—		—		—
Net assets		$	81,189,558	$	3,212,995	$	178,140	$	144,280
Net assets
Applicable to accumulation units		$	81,189,558	$	3,212,995	$	178,140	$	144,280
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	81,189,558	$	3,212,995	$	178,140	$	144,280
Investments in shares of mutual funds, at cost		$	84,622,813	$	3,237,651	$	179,982	$	150,377
Shares of mutual funds owned			8,276,203		123,767		10,712		10,425
Accumulation units outstanding			7,169,432		295,316		19,262		14,620
Annuitized units outstanding			—		—		—		—
Total units outstanding			7,169,432		295,316		19,262		14,620
Statements of Operations
Year ended December 31, 2019
		Government & High Quality Bond Class 1 Division		Guggenheim Floating Rate Strategies Series F Division		Guggenheim Investments Global Managed Futures Strategy Division		Guggenheim Investments Long Short Equity Division
Net investment income (loss)
Investment income:
	Dividends	$	2,243,995	$	153,312	$	1,820	$	1,027
Expenses:
	Mortality and expense risks		1,001,324		36,056		1,916		1,594
	Administrative charges		74,130		4,318		268		238
	Separate account rider charges		17,641		1,011		21		20
Net investment income (loss)			1,150,900		111,927		(385)		(825)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(1,262,280)		(22,693)		(4,240)		(16,156)
Capital gains distributions			—		—		—		—
Total realized gains (losses) on investments			(1,262,280)		(22,693)		(4,240)		(16,156)
Change in net unrealized appreciation (depreciation)
	of investments		4,202,128		101,575		18,197		22,140
Net gains (losses) on investments			4,090,748		190,809		13,572		5,159
Net increase (decrease) in net assets resulting from operations		$	4,090,748	$	190,809	$	13,572	$	5,159
See accompanying notes.

A-27

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Guggenheim Investments Multi-Hedge Strategies Division		International Emerging Markets Class 1 Division		Invesco American Franchise Series I Division		Invesco Balanced-Risk Allocation Series II Division
Assets
Investments in shares of mutual funds, at fair value		$	558,944	$	43,067,771	$	4,306,376	$	488,758
Total assets			558,944		43,067,771		4,306,376		488,758
Total liabilities			—		—		—		—
Net assets		$	558,944	$	43,067,771	$	4,306,376	$	488,758
Net assets
Applicable to accumulation units		$	558,944	$	43,067,771	$	4,306,376	$	488,758
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	558,944	$	43,067,771	$	4,306,376	$	488,758
Investments in shares of mutual funds, at cost		$	556,839	$	39,064,171	$	3,349,268	$	498,106
Shares of mutual funds owned			23,135		2,514,172		64,131		45,551
Accumulation units outstanding			56,774		1,427,212		177,893		43,426
Annuitized units outstanding			—		—		—		—
Total units outstanding			56,774		1,427,212		177,893		43,426
Statements of Operations
Year ended December 31, 2019
		Guggenheim Investments Multi-Hedge Strategies Division		International Emerging Markets Class 1 Division		Invesco American Franchise Series I Division		Invesco Balanced-Risk Allocation Series II Division
Net investment income (loss)
Investment income:
	Dividends	$	12,883	$	396,414	$	—	$	—
Expenses:
	Mortality and expense risks		6,158		519,375		54,196		3,784
	Administrative charges		807		45,796		2,168		554
	Separate account rider charges		114		4,066		—		—
Net investment income (loss)			5,804		(172,823)		(56,364)		(4,338)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			225		441,742		390,829		(4,186)
Capital gains distributions			—		1,129,303		584,037		—
Total realized gains (losses) on investments			225		1,571,045		974,866		(4,186)
Change in net unrealized appreciation (depreciation)
	of investments		13,267		4,885,242		326,403		54,256
Net gains (losses) on investments			19,296		6,283,464		1,244,905		45,732
Net increase (decrease) in net assets resulting from operations		$	19,296	$	6,283,464	$	1,244,905	$	45,732
See accompanying notes.

A-28

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Invesco Core Equity Series I Division		Invesco Health Care Series I Division		Invesco Health Care Series II Division		Invesco International Growth Series I Division
Assets
Investments in shares of mutual funds, at fair value		$	13,547,364	$	7,018,218	$	2,876,696	$	6,938,872
Total assets			13,547,364		7,018,218		2,876,696		6,938,872
Total liabilities			—		—		—		—
Net assets		$	13,547,364	$	7,018,218	$	2,876,696	$	6,938,872
Net assets
Applicable to accumulation units		$	13,547,364	$	7,018,218	$	2,876,696	$	6,938,872
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	13,547,364	$	7,018,218	$	2,876,696	$	6,938,872
Investments in shares of mutual funds, at cost		$	12,142,608	$	6,762,340	$	2,532,994	$	6,313,878
Shares of mutual funds owned			387,621		232,161		100,972		177,646
Accumulation units outstanding			670,204		264,181		213,307		515,775
Annuitized units outstanding			—		—		—		—
Total units outstanding			670,204		264,181		213,307		515,775
Statements of Operations
Year ended December 31, 2019
		Invesco Core Equity Series I Division		Invesco Health Care Series I Division		Invesco Health Care Series II Division		Invesco International Growth Series I Division
Net investment income (loss)
Investment income:
	Dividends	$	123,141	$	2,785	$	—	$	105,656
Expenses:
	Mortality and expense risks		167,636		84,252		16,185		87,328
	Administrative charges		6,706		4,067		2,845		10,481
	Separate account rider charges		—		256		—		3,217
Net investment income (loss)			(51,201)		(85,790)		(19,030)		4,630
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			656,662		(223,335)		(16,260)		140,504
Capital gains distributions			1,496,496		154,808		54,436		426,815
Total realized gains (losses) on investments			2,153,158		(68,527)		38,176		567,319
Change in net unrealized appreciation (depreciation)
	of investments		1,103,853		1,930,700		531,392		1,068,605
Net gains (losses) on investments			3,205,810		1,776,383		550,538		1,640,554
Net increase (decrease) in net assets resulting from operations		$	3,205,810	$	1,776,383	$	550,538	$	1,640,554
See accompanying notes.

A-29

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Invesco International Growth Series II Division		Invesco Mid Cap Growth Series I Division		Invesco Oppenheimer V.I. Main Street Small Cap Series II Division (1)		Invesco Small Cap Equity Series I Division
Assets
Investments in shares of mutual funds, at fair value		$	1,691,600	$	1,078,974	$	447,973	$	6,547,810
Total assets			1,691,600		1,078,974		447,973		6,547,810
Total liabilities			—		—		—		—
Net assets		$	1,691,600	$	1,078,974	$	447,973	$	6,547,810
Net assets
Applicable to accumulation units		$	1,691,600	$	1,078,974	$	447,973	$	6,547,810
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,691,600	$	1,078,974	$	447,973	$	6,547,810
Investments in shares of mutual funds, at cost		$	1,607,724	$	1,068,424	$	448,294	$	6,968,389
Shares of mutual funds owned			43,961		197,615		19,571		369,307
Accumulation units outstanding			148,528		51,429		26,479		237,044
Annuitized units outstanding			—		—		—		—
Total units outstanding			148,528		51,429		26,479		237,044
Statements of Operations
Year ended December 31, 2019
		Invesco International Growth Series II Division		Invesco Mid Cap Growth Series I Division		Invesco Oppenheimer V.I. Main Street Small Cap Series II Division (1)		Invesco Small Cap Equity Series I Division
Net investment income (loss)
Investment income:
	Dividends	$	16,839	$	—	$	—	$	—
Expenses:
	Mortality and expense risks		10,441		14,133		5,557		78,822
	Administrative charges		1,788		565		222		7,926
	Separate account rider charges		—		—		—		3,536
Net investment income (loss)			4,610		(14,698)		(5,779)		(90,284)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			304		9,667		860		(268,543)
Capital gains distributions			84,638		152,320		41,139		767,392
Total realized gains (losses) on investments			84,942		161,987		41,999		498,849
Change in net unrealized appreciation (depreciation)
	of investments		180,327		171,323		59,327		954,401
Net gains (losses) on investments			269,879		318,612		95,547		1,362,966
Net increase (decrease) in net assets resulting from operations		$	269,879	$	318,612	$	95,547	$	1,362,966
(1) Represented the operations of Oppenheimer Main Street Small Cap Service Shares Division until May 24, 2019.
See accompanying notes.

A-30

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Invesco Technology Series I Division		Invesco Value Opportunities Series I Division		Janus Henderson Enterprise Service Shares Division		Janus Henderson Flexible Bond Service Shares Division
Assets
Investments in shares of mutual funds, at fair value		$	3,038,459	$	3,317,641	$	10,067,295	$	3,115,567
Total assets			3,038,459		3,317,641		10,067,295		3,115,567
Total liabilities			—		—		—		—
Net assets		$	3,038,459	$	3,317,641	$	10,067,295	$	3,115,567
Net assets
Applicable to accumulation units		$	3,038,459	$	3,317,641	$	10,067,295	$	3,115,567
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	3,038,459	$	3,317,641	$	10,067,295	$	3,115,567
Investments in shares of mutual funds, at cost		$	2,424,354	$	3,536,503	$	7,125,436	$	3,073,777
Shares of mutual funds owned			111,585		592,436		125,951		239,844
Accumulation units outstanding			182,286		181,125		365,860		290,302
Annuitized units outstanding			—		—		—		—
Total units outstanding			182,286		181,125		365,860		290,302
Statements of Operations
Year ended December 31, 2019
		Invesco Technology Series I Division		Invesco Value Opportunities Series I Division		Janus Henderson Enterprise Service Shares Division		Janus Henderson Flexible Bond Service Shares Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	7,643	$	4,945	$	73,012
Expenses:
	Mortality and expense risks		39,347		40,421		124,048		23,972
	Administrative charges		1,574		4,851		4,962		3,327
	Separate account rider charges		—		800		—		795
Net investment income (loss)			(40,921)		(38,429)		(124,065)		44,918
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			281,257		(284,072)		1,072,503		237
Capital gains distributions			251,489		676,206		615,968		—
Total realized gains (losses) on investments			532,746		392,134		1,688,471		237
Change in net unrealized appreciation (depreciation)
	of investments		433,265		448,184		1,213,597		123,943
Net gains (losses) on investments			925,090		801,889		2,778,003		169,098
Net increase (decrease) in net assets resulting from operations		$	925,090	$	801,889	$	2,778,003	$	169,098
See accompanying notes.

A-31

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Janus Henderson Global Technology Service Shares Division (1)		LargeCap Growth I Class 1 Division		LargeCap S&P 500 Index Class 1 Division		LargeCap S&P 500 Index Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	348,192	$	168,969,535	$	99,605,055	$	15,836,448
Total assets			348,192		168,969,535		99,605,055		15,836,448
Total liabilities			—		—		—		—
Net assets		$	348,192	$	168,969,535	$	99,605,055	$	15,836,448
Net assets
Applicable to accumulation units		$	348,192	$	168,969,535	$	99,605,055	$	15,836,448
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	348,192	$	168,969,535	$	99,605,055	$	15,836,448
Investments in shares of mutual funds, at cost		$	323,192	$	136,263,595	$	66,054,252	$	14,463,941
Shares of mutual funds owned			23,166		4,489,095		4,933,386		793,012
Accumulation units outstanding			29,872		3,666,156		4,495,585		1,221,373
Annuitized units outstanding			—		—		—		—
Total units outstanding			29,872		3,666,156		4,495,585		1,221,373
Statements of Operations
Year ended December 31, 2019
		Janus Henderson Global Technology Service Shares Division (1)		LargeCap Growth I Class 1 Division		LargeCap S&P 500 Index Class 1 Division		LargeCap S&P 500 Index Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	79,527	$	1,770,545	$	236,328
Expenses:
	Mortality and expense risks		508		1,734,085		1,149,560		83,427
	Administrative charges		114		101,259		88,064		16,541
	Separate account rider charges		—		10,401		19,356		—
Net investment income (loss)			(622)		(1,766,218)		513,565		136,360
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			210		10,298,934		8,354,908		57,445
Capital gains distributions			—		11,945,260		4,034,790		570,361
Total realized gains (losses) on investments			210		22,244,194		12,389,698		627,806
Change in net unrealized appreciation (depreciation)
	of investments		25,001		17,797,460		11,618,691		1,957,657
Net gains (losses) on investments			24,589		38,275,436		24,521,954		2,721,823
Net increase (decrease) in net assets resulting from operations		$	24,589	$	38,275,436	$	24,521,954	$	2,721,823
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-32

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		MFS International Intrinsic Value Service Class Division (1)		MFS New Discovery Service Class Division		MFS Utilities Service Class Division		MFS Value Service Class Division
Assets
Investments in shares of mutual funds, at fair value		$	7,484,906	$	4,806,641	$	15,284,102	$	5,292,259
Total assets			7,484,906		4,806,641		15,284,102		5,292,259
Total liabilities			—		—		—		—
Net assets		$	7,484,906	$	4,806,641	$	15,284,102	$	5,292,259
Net assets
Applicable to accumulation units		$	7,484,906	$	4,806,641	$	15,284,102	$	5,292,259
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	7,484,906	$	4,806,641	$	15,284,102	$	5,292,259
Investments in shares of mutual funds, at cost		$	6,685,000	$	4,899,968	$	13,179,423	$	4,778,221
Shares of mutual funds owned			253,984		266,739		442,248		257,907
Accumulation units outstanding			569,058		301,371		708,834		169,977
Annuitized units outstanding			—		—		—		—
Total units outstanding			569,058		301,371		708,834		169,977
Statements of Operations
Year ended December 31, 2019
		MFS International Intrinsic Value Service Class Division (1)		MFS New Discovery Service Class Division		MFS Utilities Service Class Division		MFS Value Service Class Division
Net investment income (loss)
Investment income:
	Dividends	$	100,017	$	—	$	547,492	$	97,134
Expenses:
	Mortality and expense risks		74,216		40,059		167,639		63,998
	Administrative charges		9,252		4,904		21,313		7,681
	Separate account rider charges		625		1,929		6,388		2,014
Net investment income (loss)			15,924		(46,892)		352,152		23,441
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			149,376		145,196		(145,695)		616
Capital gains distributions			209,662		794,745		43,365		233,392
Total realized gains (losses) on investments			359,038		939,941		(102,330)		234,008
Change in net unrealized appreciation (depreciation)
	of investments		1,023,593		250,524		2,611,742		971,917
Net gains (losses) on investments			1,398,555		1,143,573		2,861,564		1,229,366
Net increase (decrease) in net assets resulting from operations		$	1,398,555	$	1,143,573	$	2,861,564	$	1,229,366
(1) Represented the operations of MFS International Value Service Class Division until June 6, 2019.
See accompanying notes.

A-33

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		MidCap Class 1 Division		Neuberger Berman AMT Mid Cap Growth Portfolio Class S Division		Neuberger Berman AMT Sustainable Equity Class I Division		Neuberger Berman AMT Sustainable Equity Class S Division
Assets
Investments in shares of mutual funds, at fair value		$	338,479,545	$	3,506,104	$	6,633,874	$	15,562
Total assets			338,479,545		3,506,104		6,633,874		15,562
Total liabilities			—		—		—		—
Net assets		$	338,479,545	$	3,506,104	$	6,633,874	$	15,562
Net assets
Applicable to accumulation units		$	338,479,545	$	3,506,104	$	6,633,874	$	15,562
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	338,479,545	$	3,506,104	$	6,633,874	$	15,562
Investments in shares of mutual funds, at cost		$	300,946,395	$	3,201,388	$	6,121,853	$	15,257
Shares of mutual funds owned			5,646,973		129,186		246,704		577
Accumulation units outstanding			2,907,972		252,420		220,290		1,408
Annuitized units outstanding			—		—		—		—
Total units outstanding			2,907,972		252,420		220,290		1,408
Statements of Operations
Year ended December 31, 2019
		MidCap Class 1 Division		Neuberger Berman AMT Mid Cap Growth Portfolio Class S Division		Neuberger Berman AMT Sustainable Equity Class I Division		Neuberger Berman AMT Sustainable Equity Class S Division
Net investment income (loss)
Investment income:
	Dividends	$	888,968	$	—	$	26,799	$	37
Expenses:
	Mortality and expense risks		4,005,494		34,517		70,402		24
	Administrative charges		260,970		4,748		8,449		6
	Separate account rider charges		19,603		270		1,554		—
Net investment income (loss)			(3,397,099)		(39,535)		(53,606)		7
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			22,568,551		88,264		471,482		(44)
Capital gains distributions			45,208,818		250,856		356,988		707
Total realized gains (losses) on investments			67,777,369		339,120		828,470		663
Change in net unrealized appreciation (depreciation)
	of investments		45,967,907		464,714		202,087		430
Net gains (losses) on investments			110,348,177		764,299		976,951		1,100
Net increase (decrease) in net assets resulting from operations		$	110,348,177	$	764,299	$	976,951	$	1,100
See accompanying notes.

A-34

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		PIMCO All Asset Administrative Class Division		PIMCO All Asset Advisor Class Division		PIMCO Commodity Real Return Strategy M Class Division		PIMCO High Yield Administrative Class Division
Assets
Investments in shares of mutual funds, at fair value		$	2,418,683	$	112,386	$	51,476	$	19,995,082
Total assets			2,418,683		112,386		51,476		19,995,082
Total liabilities			—		—		—		—
Net assets		$	2,418,683	$	112,386	$	51,476	$	19,995,082
Net assets
Applicable to accumulation units		$	2,418,683	$	112,386	$	51,476	$	19,995,082
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	2,418,683	$	112,386	$	51,476	$	19,995,082
Investments in shares of mutual funds, at cost		$	2,317,622	$	107,993	$	52,451	$	19,406,321
Shares of mutual funds owned			224,159		10,292		8,081		2,515,105
Accumulation units outstanding			146,674		10,170		5,759		1,296,959
Annuitized units outstanding			—		—		—		—
Total units outstanding			146,674		10,170		5,759		1,296,959
Statements of Operations
Year ended December 31, 2019
		PIMCO All Asset Administrative Class Division		PIMCO All Asset Advisor Class Division		PIMCO Commodity Real Return Strategy M Class Division		PIMCO High Yield Administrative Class Division
Net investment income (loss)
Investment income:
	Dividends	$	75,019	$	3,031	$	2,023	$	941,455
Expenses:
	Mortality and expense risks		32,606		1,113		352		225,340
	Administrative charges		3,913		160		73		28,570
	Separate account rider charges		1,045		—		—		4,576
Net investment income (loss)			37,455		1,758		1,598		682,969
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(63,142)		196		(944)		(136,964)
Capital gains distributions			—		—		—		—
Total realized gains (losses) on investments			(63,142)		196		(944)		(136,964)
Change in net unrealized appreciation (depreciation)
	of investments		280,847		8,554		3,743		1,771,178
Net gains (losses) on investments			255,160		10,508		4,397		2,317,183
Net increase (decrease) in net assets resulting from operations		$	255,160	$	10,508	$	4,397	$	2,317,183
See accompanying notes.

A-35

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		PIMCO Low Duration Advisor Class Division		PIMCO Total Return Administrative Class Division		Principal Capital Appreciation Class 1 Division		Principal Capital Appreciation Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	1,525,804	$	22,921,307	$	97,426,768	$	5,277,728
Total assets			1,525,804		22,921,307		97,426,768		5,277,728
Total liabilities			—		—		—		—
Net assets		$	1,525,804	$	22,921,307	$	97,426,768	$	5,277,728
Net assets
Applicable to accumulation units		$	1,525,804	$	22,921,307	$	97,426,768	$	5,277,728
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	1,525,804	$	22,921,307	$	97,426,768	$	5,277,728
Investments in shares of mutual funds, at cost		$	1,522,574	$	22,884,909	$	76,483,076	$	4,942,122
Shares of mutual funds owned			149,589		2,079,974		3,171,444		174,068
Accumulation units outstanding			149,387		1,771,251		4,600,862		396,730
Annuitized units outstanding			—		—		—		—
Total units outstanding			149,387		1,771,251		4,600,862		396,730
Statements of Operations
Year ended December 31, 2019
		PIMCO Low Duration Advisor Class Division		PIMCO Total Return Administrative Class Division		Principal Capital Appreciation Class 1 Division		Principal Capital Appreciation Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	29,222	$	666,027	$	1,524,187	$	54,371
Expenses:
	Mortality and expense risks		10,926		261,720		1,220,327		25,498
	Administrative charges		1,589		33,233		114,170		5,089
	Separate account rider charges		304		4,555		18,541		—
Net investment income (loss)			16,403		366,519		171,149		23,784
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			4,074		(222,581)		4,940,174		8,924
Capital gains distributions			—		—		8,501,132		346,247
Total realized gains (losses) on investments			4,074		(222,581)		13,441,306		355,171
Change in net unrealized appreciation (depreciation)
	of investments		7,635		1,307,644		12,272,884		471,338
Net gains (losses) on investments			28,112		1,451,582		25,885,339		850,293
Net increase (decrease) in net assets resulting from operations		$	28,112	$	1,451,582	$	25,885,339	$	850,293
See accompanying notes.

A-36

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Principal LifeTime 2010 Class 1 Division		Principal LifeTime 2020 Class 1 Division		Principal LifeTime 2030 Class 1 Division		Principal LifeTime 2040 Class 1 Division
Assets
Investments in shares of mutual funds, at fair value		$	16,849,543	$	82,586,232	$	57,570,462	$	15,574,030
Total assets			16,849,543		82,586,232		57,570,462		15,574,030
Total liabilities			—		—		—		—
Net assets		$	16,849,543	$	82,586,232	$	57,570,462	$	15,574,030
Net assets
Applicable to accumulation units		$	16,849,543	$	82,586,232	$	57,570,462	$	15,574,030
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	16,849,543	$	82,586,232	$	57,570,462	$	15,574,030
Investments in shares of mutual funds, at cost		$	16,019,922	$	73,422,199	$	53,685,190	$	13,605,952
Shares of mutual funds owned			1,321,533		5,941,455		4,387,993		960,174
Accumulation units outstanding			934,631		4,011,932		2,723,515		704,945
Annuitized units outstanding			—		—		—		—
Total units outstanding			934,631		4,011,932		2,723,515		704,945
Statements of Operations
Year ended December 31, 2019
		Principal LifeTime 2010 Class 1 Division		Principal LifeTime 2020 Class 1 Division		Principal LifeTime 2030 Class 1 Division		Principal LifeTime 2040 Class 1 Division
Net investment income (loss)
Investment income:
	Dividends	$	485,009	$	2,028,529	$	1,164,425	$	270,134
Expenses:
	Mortality and expense risks		214,965		1,045,048		705,643		179,300
	Administrative charges		23,277		118,022		81,517		20,754
	Separate account rider charges		2,536		9,030		5,954		2,780
Net investment income (loss)			244,231		856,429		371,311		67,300
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			526,211		4,896,631		2,233,247		593,428
Capital gains distributions			916,072		3,596,029		2,932,847		732,830
Total realized gains (losses) on investments			1,442,283		8,492,660		5,166,094		1,326,258
Change in net unrealized appreciation (depreciation)
	of investments		377,927		3,601,273		5,019,700		1,558,385
Net gains (losses) on investments			2,064,441		12,950,362		10,557,105		2,951,943
Net increase (decrease) in net assets resulting from operations		$	2,064,441	$	12,950,362	$	10,557,105	$	2,951,943
See accompanying notes.

A-37

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Principal LifeTime 2050 Class 1 Division		Principal LifeTime Strategic Income Class 1 Division		Real Estate Securities Class 1 Division		Real Estate Securities Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	11,861,338	$	10,633,375	$	67,480,063	$	6,105,983
Total assets			11,861,338		10,633,375		67,480,063		6,105,983
Total liabilities			—		—		—		—
Net assets		$	11,861,338	$	10,633,375	$	67,480,063	$	6,105,983
Net assets
Applicable to accumulation units		$	11,861,338	$	10,633,375	$	67,480,063	$	6,105,983
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	11,861,338	$	10,633,375	$	67,480,063	$	6,105,983
Investments in shares of mutual funds, at cost		$	10,668,518	$	10,248,511	$	61,255,105	$	5,931,794
Shares of mutual funds owned			760,830		892,061		3,138,608		283,209
Accumulation units outstanding			549,476		662,148		977,715		441,130
Annuitized units outstanding			—		—		—		—
Total units outstanding			549,476		662,148		977,715		441,130
Statements of Operations
Year ended December 31, 2019
		Principal LifeTime 2050 Class 1 Division		Principal LifeTime Strategic Income Class 1 Division		Real Estate Securities Class 1 Division		Real Estate Securities Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	219,230	$	265,956	$	1,229,312	$	76,986
Expenses:
	Mortality and expense risks		136,550		140,085		858,214		40,090
	Administrative charges		16,279		14,767		69,633		6,692
	Separate account rider charges		1,050		2,221		20,315		—
Net investment income (loss)			65,351		108,883		281,150		30,204
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			379,376		289,969		5,235,761		(775)
Capital gains distributions			699,559		435,243		4,527,094		312,150
Total realized gains (losses) on investments			1,078,935		725,212		9,762,855		311,375
Change in net unrealized appreciation (depreciation)
	of investments		1,254,271		327,916		7,368,808		675,230
Net gains (losses) on investments			2,398,557		1,162,011		17,412,813		1,016,809
Net increase (decrease) in net assets resulting from operations		$	2,398,557	$	1,162,011	$	17,412,813	$	1,016,809
See accompanying notes.

A-38

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		Rydex Basic Materials Division		Rydex Commodities Strategy Division		Rydex NASDAQ 100 Division		SAM Balanced Portfolio Class 1 Division
Assets
Investments in shares of mutual funds, at fair value		$	606,375	$	499,045	$	3,094,997	$	427,977,306
Total assets			606,375		499,045		3,094,997		427,977,306
Total liabilities			—		—		—		—
Net assets		$	606,375	$	499,045	$	3,094,997	$	427,977,306
Net assets
Applicable to accumulation units		$	606,375	$	499,045	$	3,094,997	$	427,977,306
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	606,375	$	499,045	$	3,094,997	$	427,977,306
Investments in shares of mutual funds, at cost		$	562,747	$	522,561	$	2,508,927	$	426,614,249
Shares of mutual funds owned			7,980		6,132		63,344		27,311,889
Accumulation units outstanding			53,471		68,023		201,423		23,733,630
Annuitized units outstanding			—		—		—		—
Total units outstanding			53,471		68,023		201,423		23,733,630
Statements of Operations
Year ended December 31, 2019
		Rydex Basic Materials Division		Rydex Commodities Strategy Division		Rydex NASDAQ 100 Division		SAM Balanced Portfolio Class 1 Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	7,609	$	3,051	$	10,612,144
Expenses:
	Mortality and expense risks		5,846		5,093		21,751		5,452,149
	Administrative charges		838		691		3,631		603,843
	Separate account rider charges		—		369		—		54,305
Net investment income (loss)			(6,684)		1,456		(22,331)		4,501,847
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,805		(5,564)		27,852		3,304,718
Capital gains distributions			25,583		—		55,162		15,208,949
Total realized gains (losses) on investments			27,388		(5,564)		83,014		18,513,667
Change in net unrealized appreciation (depreciation)
	of investments		78,927		64,075		655,958		50,648,846
Net gains (losses) on investments			99,631		59,967		716,641		73,664,360
Net increase (decrease) in net assets resulting from operations		$	99,631	$	59,967	$	716,641	$	73,664,360
See accompanying notes.

A-39

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		SAM Balanced Portfolio Class 2 Division		SAM Conservative Balanced Portfolio Class 1 Division		SAM Conservative Balanced Portfolio Class 2 Division		SAM Conservative Growth Portfolio Class 1 Division
Assets
Investments in shares of mutual funds, at fair value		$	22,821,199	$	102,121,678	$	8,927,893	$	89,362,293
Total assets			22,821,199		102,121,678		8,927,893		89,362,293
Total liabilities			—		—		—		—
Net assets		$	22,821,199	$	102,121,678	$	8,927,893	$	89,362,293
Net assets
Applicable to accumulation units		$	22,821,199	$	102,121,678	$	8,927,893	$	89,362,293
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	22,821,199	$	102,121,678	$	8,927,893	$	89,362,293
Investments in shares of mutual funds, at cost		$	22,299,322	$	102,412,755	$	8,756,050	$	82,227,826
Shares of mutual funds owned			1,474,238		8,377,496		742,136		4,481,559
Accumulation units outstanding			1,918,479		6,014,002		773,877		4,770,301
Annuitized units outstanding			—		—		—		—
Total units outstanding			1,918,479		6,014,002		773,877		4,770,301
Statements of Operations
Year ended December 31, 2019
		SAM Balanced Portfolio Class 2 Division		SAM Conservative Balanced Portfolio Class 1 Division		SAM Conservative Balanced Portfolio Class 2 Division		SAM Conservative Growth Portfolio Class 1 Division
Net investment income (loss)
Investment income:
	Dividends	$	447,715	$	2,892,642	$	213,181	$	1,602,856
Expenses:
	Mortality and expense risks		150,114		1,302,778		62,589		1,104,765
	Administrative charges		26,931		145,804		11,001		119,044
	Separate account rider charges		—		26,267		—		39,529
Net investment income (loss)			270,670		1,417,793		139,591		339,518
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(15,916)		(367,229)		(52,749)		(528,771)
Capital gains distributions			707,372		2,015,406		159,984		3,991,903
Total realized gains (losses) on investments			691,456		1,648,177		107,235		3,463,132
Change in net unrealized appreciation (depreciation)
	of investments		1,939,678		10,844,136		704,735		14,010,768
Net gains (losses) on investments			2,901,804		13,910,106		951,561		17,813,418
Net increase (decrease) in net assets resulting from operations		$	2,901,804	$	13,910,106	$	951,561	$	17,813,418
See accompanying notes.

A-40

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		SAM Conservative Growth Portfolio Class 2 Division		SAM Flexible Income Portfolio Class 1 Division		SAM Flexible Income Portfolio Class 2 Division		SAM Strategic Growth Portfolio Class 1 Division
Assets
Investments in shares of mutual funds, at fair value		$	15,671,496	$	121,789,147	$	16,832,897	$	53,899,787
Total assets			15,671,496		121,789,147		16,832,897		53,899,787
Total liabilities			—		—		—		—
Net assets		$	15,671,496	$	121,789,147	$	16,832,897	$	53,899,787
Net assets
Applicable to accumulation units		$	15,671,496	$	121,789,147	$	16,832,897	$	53,899,787
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	15,671,496	$	121,789,147	$	16,832,897	$	53,899,787
Investments in shares of mutual funds, at cost		$	14,744,342	$	124,381,309	$	16,865,706	$	49,377,630
Shares of mutual funds owned			798,344		9,681,172		1,353,127		2,466,809
Accumulation units outstanding			1,277,973		7,363,100		1,491,010		2,857,502
Annuitized units outstanding			—		—		—		—
Total units outstanding			1,277,973		7,363,100		1,491,010		2,857,502
Statements of Operations
Year ended December 31, 2019
		SAM Conservative Growth Portfolio Class 2 Division		SAM Flexible Income Portfolio Class 1 Division		SAM Flexible Income Portfolio Class 2 Division		SAM Strategic Growth Portfolio Class 1 Division
Net investment income (loss)
Investment income:
	Dividends	$	207,339	$	4,286,637	$	509,998	$	792,710
Expenses:
	Mortality and expense risks		102,035		1,565,208		119,586		668,710
	Administrative charges		18,301		160,882		21,680		71,926
	Separate account rider charges		—		35,911		—		44,994
Net investment income (loss)			87,003		2,524,636		368,732		7,080
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			(197,135)		(1,816,480)		(42,573)		(355,117)
Capital gains distributions			592,642		3,510,843		444,342		2,669,409
Total realized gains (losses) on investments			395,507		1,694,363		401,769		2,314,292
Change in net unrealized appreciation (depreciation)
	of investments		1,980,212		9,732,166		796,351		9,809,596
Net gains (losses) on investments			2,462,722		13,951,165		1,566,852		12,130,968
Net increase (decrease) in net assets resulting from operations		$	2,462,722	$	13,951,165	$	1,566,852	$	12,130,968
See accompanying notes.

A-41

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		SAM Strategic Growth Portfolio Class 2 Division		Short-Term Income Class 1 Division		SmallCap Class 1 Division		SmallCap Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	9,817,608	$	70,426,988	$	94,321,287	$	2,452,075
Total assets			9,817,608		70,426,988		94,321,287		2,452,075
Total liabilities			—		—		—		—
Net assets		$	9,817,608	$	70,426,988	$	94,321,287	$	2,452,075
Net assets
Applicable to accumulation units		$	9,817,608	$	70,426,988	$	94,321,287	$	2,452,075
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	9,817,608	$	70,426,988	$	94,321,287	$	2,452,075
Investments in shares of mutual funds, at cost		$	9,157,976	$	70,318,400	$	91,832,918	$	2,467,316
Shares of mutual funds owned			455,997		27,403,498		6,152,726		160,687
Accumulation units outstanding			772,635		5,888,713		3,367,102		209,817
Annuitized units outstanding			—		—		—		—
Total units outstanding			772,635		5,888,713		3,367,102		209,817
Statements of Operations
Year ended December 31, 2019
		SAM Strategic Growth Portfolio Class 2 Division		Short-Term Income Class 1 Division		SmallCap Class 1 Division		SmallCap Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	116,734	$	1,887,518	$	306,075	$	1,669
Expenses:
	Mortality and expense risks		72,147		885,706		1,173,564		15,018
	Administrative charges		12,144		93,784		84,964		2,676
	Separate account rider charges		—		2,575		13,341		—
Net investment income (loss)			32,443		905,453		(965,794)		(16,025)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			1,693		(209,413)		1,295,263		(10,050)
Capital gains distributions			462,971		—		14,541,856		282,763
Total realized gains (losses) on investments			464,664		(209,413)		15,837,119		272,713
Change in net unrealized appreciation (depreciation)
	of investments		1,256,273		1,637,793		6,475,160		125,227
Net gains (losses) on investments			1,753,380		2,333,833		21,346,485		381,915
Net increase (decrease) in net assets resulting from operations		$	1,753,380	$	2,333,833	$	21,346,485	$	381,915.00
See accompanying notes.

A-42

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		T. Rowe Price Blue Chip Growth Portfolio II Division		T. Rowe Price Health Sciences Portfolio II Division		Templeton Global Bond VIP Class 4 Division		Templeton Growth VIP Class 2 Division
Assets
Investments in shares of mutual funds, at fair value		$	25,128,752	$	26,161,281	$	5,135,868	$	661,321
Total assets			25,128,752		26,161,281		5,135,868		661,321
Total liabilities			—		—		—		—
Net assets		$	25,128,752	$	26,161,281	$	5,135,868	$	661,321
Net assets
Applicable to accumulation units		$	25,128,752	$	26,161,281	$	5,135,868	$	661,321
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	25,128,752	$	26,161,281	$	5,135,868	$	661,321
Investments in shares of mutual funds, at cost		$	17,203,293	$	21,750,360	$	5,344,916	$	717,155
Shares of mutual funds owned			671,533		550,996		314,505		60,672
Accumulation units outstanding			750,517		384,143		528,460		27,401
Annuitized units outstanding			—		—		—		—
Total units outstanding			750,517		384,143		528,460		27,401
Statements of Operations
Year ended December 31, 2019
		T. Rowe Price Blue Chip Growth Portfolio II Division		T. Rowe Price Health Sciences Portfolio II Division		Templeton Global Bond VIP Class 4 Division		Templeton Growth VIP Class 2 Division
Net investment income (loss)
Investment income:
	Dividends	$	—	$	1	$	341,834	$	19,901
Expenses:
	Mortality and expense risks		295,353		326,716		54,613		6,068
	Administrative charges		35,826		39,211		5,157		—
	Separate account rider charges		16,257		12,266		36		—
Net investment income (loss)			(347,436)		(378,192)		282,028		13,833
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			2,393,150		1,533,158		(4,983)		13,127
Capital gains distributions			656,257		1,152,741		—		136,712
Total realized gains (losses) on investments			3,049,407		2,685,899		(4,983)		149,839
Change in net unrealized appreciation (depreciation)
	of investments		2,988,815		3,884,057		(251,832)		(69,823)
Net gains (losses) on investments			5,690,786		6,191,764		25,213		93,849
Net increase (decrease) in net assets resulting from operations		$	5,690,786	$	6,191,764	$	25,213	$	93,849
See accompanying notes.

A-43

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		The Merger Fund Division		TOPS Aggressive Growth ETF Portfolio Investor Class Division		TOPS Balanced ETF Portfolio Investor Class Division		TOPS Conservative ETF Portfolio Investor Class Division
Assets
Investments in shares of mutual funds, at fair value		$	303,906	$	624,179	$	1,016,846	$	294,919
Total assets			303,906		624,179		1,016,846		294,919
Total liabilities			—		—		—		—
Net assets		$	303,906	$	624,179	$	1,016,846	$	294,919
Net assets
Applicable to accumulation units		$	303,906	$	624,179	$	1,016,846	$	294,919
Applicable to contracts in annuitization period			—		—		—		—
Total net assets		$	303,906	$	624,179	$	1,016,846	$	294,919
Investments in shares of mutual funds, at cost		$	305,498	$	594,406	$	998,637	$	286,879
Shares of mutual funds owned			26,658		38,577		76,743		23,518
Accumulation units outstanding			27,475		58,588		94,938		27,975
Annuitized units outstanding			—		—		—		—
Total units outstanding			27,475		58,588		94,938		27,975
Statements of Operations
Year ended December 31, 2019
		The Merger Fund Division		TOPS Aggressive Growth ETF Portfolio Investor Class Division		TOPS Balanced ETF Portfolio Investor Class Division		TOPS Conservative ETF Portfolio Investor Class Division
Net investment income (loss)
Investment income:
	Dividends	$	3,070	$	7,862	$	7,104	$	36
Expenses:
	Mortality and expense risks		1,731		1,986		1,725		856
	Administrative charges		365		491		425		126
	Separate account rider charges		—		—		—		283
Net investment income (loss)			974		5,385		4,954		(1,229)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			2,557		(227)		(35)		706
Capital gains distributions			13,581		18,463		8,333		20
Total realized gains (losses) on investments			16,138		18,236		8,298		726
Change in net unrealized appreciation (depreciation)
	of investments		(4,844)		32,198		20,850		8,040
Net gains (losses) on investments			12,268		55,819		34,102		7,537
Net increase (decrease) in net assets resulting from operations		$	12,268	$	55,819	$	34,102	$	7,537
See accompanying notes.

A-44

Principal Life Insurance Company
Separate Account B
Statements of Assets and Liabilities
December 31, 2019
		TOPS Growth ETF Portfolio Investor Class Division		TOPS Moderate Growth ETF Portfolio Investor Class Division		VanEck Global Hard Assets Class S Division
Assets
Investments in shares of mutual funds, at fair value		$	1,043,513	$	237,263	$	3,957,008
Total assets			1,043,513		237,263		3,957,008
Total liabilities			—		—		—
Net assets		$	1,043,513	$	237,263	$	3,957,008
Net assets
Applicable to accumulation units		$	1,043,513	$	237,263	$	3,957,008
Applicable to contracts in annuitization period			—		—		—
Total net assets		$	1,043,513	$	237,263	$	3,957,008
Investments in shares of mutual funds, at cost		$	987,148	$	231,789	$	4,394,776
Shares of mutual funds owned			63,282		17,523		216,704
Accumulation units outstanding			97,754		22,031		483,954
Annuitized units outstanding			—		—		—
Total units outstanding			97,754		22,031		483,954
Statements of Operations
Year ended December 31, 2019
		TOPS Growth ETF Portfolio Investor Class Division		TOPS Moderate Growth ETF Portfolio Investor Class Division		VanEck Global Hard Assets Class S Division
Net investment income (loss)
Investment income:
	Dividends	$	12,471	$	713	$	—
Expenses:
	Mortality and expense risks		5,116		350		48,835
	Administrative charges		1,221		77		5,458
	Separate account rider charges		165		—		2,049
Net investment income (loss)			5,969		286		(56,342)
Realized gains (losses) on investments
Realized gains (losses) on sale of fund shares			6,702		1,168		(362,083)
Capital gains distributions			24,166		919		—
Total realized gains (losses) on investments			30,868		2,087		(362,083)
Change in net unrealized appreciation (depreciation)
	of investments		56,486		5,737		802,914
Net gains (losses) on investments			93,323		8,110		384,489
Net increase (decrease) in net assets resulting from operations		$	93,323	$	8,110	$	384,489
See accompanying notes.

A-45

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		AllianceBernstein Small Cap Growth Class A Division		AllianceBernstein Small/Mid Cap Value Class A Division		Alps/Red Rocks Listed Private Equity Class III Division		American Century VP Capital Appreciation Class I Division
Net assets as of January 1, 2018		$	4,775,181	$	5,183,572	$	113,522	$	2,339,237
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(77,444)		(53,383)		10,722		(34,190)
	Total realized gains (losses) on investments		192,836		357,196		1,478		43,644
	Change in net unrealized appreciation (depreciation)
	of investments		(215,621)		(1,153,428)		(40,514)		(139,577)
	Net gains (losses) on investments		(100,229)		(849,615)		(28,314)		(130,123)
Net increase (decrease) in net assets resulting from operations			(100,229)		(849,615)		(28,314)		(130,123)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,049,822		601,050		156,413		118,799
	Administration charges		(280)		(64)		(319)		(1,341)
	Contingent sales charges		(3,376)		(1,343)		(19)		(965)
	Contract terminations		(486,642)		(211,976)		(2,601)		(139,087)
	Death benefit payments		(35,629)		(8,689)		—		—
	Flexible withdrawal option payments		(26,934)		(30,310)		(634)		(24,593)
	Transfers to other contracts		(701,361)		(548,169)		(13,238)		(315,557)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(204,400)		(199,501)		139,602		(362,744)
Total increase (decrease)			(304,629)		(1,049,116)		111,288		(492,867)
Net assets as of December 31, 2018			4,470,552		4,134,456		224,810		1,846,370
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(71,934)		(41,846)		(3,228)		(27,766)
	Total realized gains (losses) on investments		539,459		510,926		6,997		367,894
	Change in net unrealized appreciation (depreciation)
	of investments		981,251		290,994		110,089		244,068
	Net gains (losses) on investments		1,448,776		760,074		113,858		584,196
Net increase (decrease) in net assets resulting from operations			1,448,776		760,074		113,858		584,196
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		587,457		410,219		209,071		161,127
	Administration charges		(155)		—		(975)		(940)
	Contingent sales charges		(5,271)		(923)		(7)		(3,009)
	Contract terminations		(948,997)		(206,957)		(353)		(541,655)
	Death benefit payments		(347,653)		(24,117)		—		(124,660)
	Flexible withdrawal option payments		(42,525)		(30,022)		(1,480)		(25,007)
	Transfers to other contracts		(613,291)		(163,568)		(17,670)		(230,329)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(1,370,435)		(15,368)		188,586		(764,473)
Total increase (decrease)			78,341		744,706		302,444		(180,277)
Net assets as of December 31, 2019		$	4,548,893	$	4,879,162	$	527,254	$	1,666,093
See accompanying notes.

A-46

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		American Century VP Income & Growth Class I Division		American Century VP Inflation Protection Class II Division		American Century VP Mid Cap Value Class II Division		American Century VP Ultra Class I Division
Net assets as of January 1, 2018		$	11,044,484	$	42,538,825	$	9,987,649	$	3,781,713
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		76,413		548,339		(20,203)		(41,330)
	Total realized gains (losses) on investments		1,654,459		(1,924,563)		810,023		734,926
	Change in net unrealized appreciation (depreciation)
	of investments		(2,472,593)		(338,271)		(2,086,089)		(679,662)
	Net gains (losses) on investments		(741,721)		(1,714,495)		(1,296,269)		13,934
Net increase (decrease) in net assets resulting from operations			(741,721)		(1,714,495)		(1,296,269)		13,934
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		157,498		4,555,757		1,030,633		346,648
	Administration charges		(897)		(233,395)		(379)		(610)
	Contingent sales charges		(521)		(24,641)		(4,335)		(303)
	Contract terminations		(831,709)		(3,599,512)		(709,198)		(434,333)
	Death benefit payments		(25,442)		(433,000)		(12,247)		(10,362)
	Flexible withdrawal option payments		(134,915)		(1,488,008)		(65,179)		(66,563)
	Transfers to other contracts		(443,941)		(5,231,319)		(1,217,151)		(163,164)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(1,279,927)		(6,454,118)		(977,856)		(328,687)
Total increase (decrease)			(2,021,648)		(8,168,613)		(2,274,125)		(314,753)
Net assets as of December 31, 2018			9,022,836		34,370,212		7,713,524		3,466,960
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		84,155		303,127		39,610		(49,626)
	Total realized gains (losses) on investments		1,518,079		(524,818)		913,883		882,150
	Change in net unrealized appreciation (depreciation)
	of investments		331,794		2,697,738		1,096,939		213,258
	Net gains (losses) on investments		1,934,028		2,476,047		2,050,432		1,045,782
Net increase (decrease) in net assets resulting from operations			1,934,028		2,476,047		2,050,432		1,045,782
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		368,576		4,168,207		655,278		309,700
	Administration charges		(580)		(153,408)		(241)		(477)
	Contingent sales charges		(582)		(26,413)		(3,116)		(693)
	Contract terminations		(1,050,910)		(4,794,953)		(659,970)		(823,217)
	Death benefit payments		(69,402)		(302,210)		(47,913)		(1,346)
	Flexible withdrawal option payments		(135,418)		(1,333,078)		(57,763)		(55,232)
	Transfers to other contracts		(257,318)		(1,685,504)		(520,087)		(218,387)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(1,145,634)		(4,127,359)		(633,812)		(789,652)
Total increase (decrease)			788,394		(1,651,312)		1,416,620		256,130
Net assets as of December 31, 2019		$	9,811,230	$	32,718,900	$	9,130,144	$	3,723,090
See accompanying notes.

A-47

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		American Century VP Ultra Class II Division		American Century VP Value Class II Division		American Funds Insurance Series Asset Allocation Fund Class 2 Division		American Funds Insurance Series Asset Allocation Fund Class 4 Division
Net assets as of January 1, 2018		$	33,152,528	$	16,006,654	$	1,826,662	$	1,851,534
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(401,123)		30,261		11,770		21,682
	Total realized gains (losses) on investments		9,042,423		812,303		95,513		148,376
	Change in net unrealized appreciation (depreciation)
	of investments		(8,103,195)		(2,347,999)		(284,645)		(399,237)
	Net gains (losses) on investments		538,105		(1,505,435)		(177,362)		(229,179)
Net increase (decrease) in net assets resulting from operations			538,105		(1,505,435)		(177,362)		(229,179)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		3,232,144		750,264		1,210,766		2,115,344
	Administration charges		(168,199)		(5,344)		(385)		(8,391)
	Contingent sales charges		(18,670)		(1,737)		(255)		(218)
	Contract terminations		(2,691,088)		(1,489,647)		(152,849)		(25,772)
	Death benefit payments		(539,721)		(33,456)		(42,035)		—
	Flexible withdrawal option payments		(1,180,672)		(144,380)		(23,885)		(9,896)
	Transfers to other contracts		(6,278,086)		(871,673)		(193,363)		(19,247)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(7,644,292)		(1,795,973)		797,994		2,051,820
Total increase (decrease)			(7,106,187)		(3,301,408)		620,632		1,822,641
Net assets as of December 31, 2018			26,046,341		12,705,246		2,447,294		3,674,175
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(388,001)		87,733		8,156		63,863
	Total realized gains (losses) on investments		6,884,780		1,693,493		155,785		288,485
	Change in net unrealized appreciation (depreciation)
	of investments		1,259,749		1,236,399		304,219		610,593
	Net gains (losses) on investments		7,756,528		3,017,625		468,160		962,941
Net increase (decrease) in net assets resulting from operations			7,756,528		3,017,625		468,160		962,941
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,393,845		614,644		319,193		4,418,942
	Administration charges		(109,871)		(4,390)		(392)		(13,660)
	Contingent sales charges		(18,245)		(3,448)		(1,547)		(5,343)
	Contract terminations		(3,284,723)		(1,498,832)		(441,234)		(560,758)
	Death benefit payments		(262,546)		(83,298)		(12,605)		—
	Flexible withdrawal option payments		(1,033,580)		(138,781)		(33,342)		(26,389)
	Transfers to other contracts		(4,020,313)		(604,736)		(34,264)		(270,009)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(7,335,433)		(1,718,841)		(204,191)		3,542,783
Total increase (decrease)			421,095		1,298,784		263,969		4,505,724
Net assets as of December 31, 2019		$	26,467,436	$	14,004,030	$	2,711,263	$	8,179,899
See accompanying notes.

A-48

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
				American Funds Insurance Series Blue Chip Income and Growth Class 4 Division		American Funds Insurance Series Global Small Capitalization Fund Class 2 Division		American Funds Insurance Series Global Small Capitalization Fund Class 4 Division
		American Funds Insurance Series Blue Chip Income and Growth Class 2 Division
Net assets as of January 1, 2018		$	3,016,929	$	2,076,143	$	1,210,640	$	373,779
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		14,787		36,101		(18,189)		(6,384)
	Total realized gains (losses) on investments		307,958		232,064		54,185		20,674
	Change in net unrealized appreciation (depreciation)
	of investments		(652,359)		(645,000)		(216,726)		(120,290)
	Net gains (losses) on investments		(329,614)		(376,835)		(180,730)		(106,000)
Net increase (decrease) in net assets resulting from operations			(329,614)		(376,835)		(180,730)		(106,000)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		971,798		2,271,679		550,691		677,927
	Administration charges		(110)		(7,110)		(121)		(1,654)
	Contingent sales charges		(2,512)		(989)		(439)		(233)
	Contract terminations		(381,170)		(107,646)		(87,103)		(14,283)
	Death benefit payments		(40,777)		(1,032)		—		—
	Flexible withdrawal option payments		(14,059)		(18,586)		(7,193)		(2,516)
	Transfers to other contracts		(360,643)		(342,863)		(164,293)		(225,799)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			172,527		1,793,453		291,542		433,442
Total increase (decrease)			(157,087)		1,416,618		110,812		327,442
Net assets as of December 31, 2018			2,859,842		3,492,761		1,321,452		701,221
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		15,716		66,132		(18,832)		(9,662)
	Total realized gains (losses) on investments		211,369		360,148		99,806		64,378
	Change in net unrealized appreciation (depreciation)
	of investments		328,167		480,315		300,967		206,083
	Net gains (losses) on investments		555,252		906,595		381,941		260,799
Net increase (decrease) in net assets resulting from operations			555,252		906,595		381,941		260,799
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		558,858		2,457,216		140,546		563,534
	Administration charges		(103)		(11,752)		(85)		(2,737)
	Contingent sales charges		(1,173)		(3,246)		(722)		(241)
	Contract terminations		(328,828)		(135,980)		(171,726)		(13,741)
	Death benefit payments		(14,579)		(2,232)		(3,413)		(3,021)
	Flexible withdrawal option payments		(12,903)		(39,057)		(7,843)		(3,618)
	Transfers to other contracts		(217,453)		(79,824)		(86,731)		(68,471)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(16,181)		2,185,125		(129,974)		471,705
Total increase (decrease)			539,071		3,091,720		251,967		732,504
Net assets as of December 31, 2019		$	3,398,913	$	6,584,481	$	1,573,419	$	1,433,725
See accompanying notes.

A-49

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
				American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2 Division				American Funds Insurance Series Managed Risk International Fund Class P2 Division
		American Funds Insurance Series High-Income Bond Class 2 Division				American Funds Insurance Series Managed Risk Growth Fund Class P2 Division
Net assets as of January 1, 2018		$	1,439,038	$	793,506	$	657,930	$	119,750
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		60,726		3,252		(6,238)		786
	Total realized gains (losses) on investments		(6,343)		44,816		79,574		1,407
	Change in net unrealized appreciation (depreciation)
	of investments		(98,561)		(115,554)		(119,881)		(19,439)
	Net gains (losses) on investments		(44,178)		(67,486)		(46,545)		(17,246)
Net increase (decrease) in net assets resulting from operations			(44,178)		(67,486)		(46,545)		(17,246)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		135,253		438,941		982,051		47,405
	Administration charges		(4)		(2,633)		(2,627)		(440)
	Contingent sales charges		(83)		(18)		(174)		(9)
	Contract terminations		(119,381)		(5,157)		(36,400)		(2,491)
	Death benefit payments		(26,699)		(6,234)		—		—
	Flexible withdrawal option payments		(18,488)		(8,168)		(3,380)		(486)
	Transfers to other contracts		(170,333)		(51,027)		(30,520)		(11,149)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(199,735)		365,704		908,950		32,830
Total increase (decrease)			(243,913)		298,218		862,405		15,584
Net assets as of December 31, 2018			1,195,125		1,091,724		1,520,335		135,334
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		60,481		19,190		(1,056)		1,056
	Total realized gains (losses) on investments		(13,107)		62,828		127,309		5,460
	Change in net unrealized appreciation (depreciation)
	of investments		84,089		161,896		211,306		18,281
	Net gains (losses) on investments		131,463		243,914		337,559		24,797
Net increase (decrease) in net assets resulting from operations			131,463		243,914		337,559		24,797
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		250,501		853,193		299,248		42,295
	Administration charges		(3)		(3,722)		(4,649)		(541)
	Contingent sales charges		(196)		(193)		(282)		(14)
	Contract terminations		(232,337)		(9,184)		(12,629)		(653)
	Death benefit payments		(10,845)		—		—		—
	Flexible withdrawal option payments		(9,095)		(18,939)		(7,584)		(453)
	Transfers to other contracts		(87,384)		(3,425)		(38,984)		(230)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(89,359)		817,730		235,120		40,404
Total increase (decrease)			42,104		1,061,644		572,679		65,201
Net assets as of December 31, 2019		$	1,237,229	$	2,153,368	$	2,093,014	$	200,535
See accompanying notes.

A-50

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		American Funds Insurance Series New World Fund Class 2 Division		American Funds Insurance Series New World Fund Class 4 Division		BlackRock 60/40 Target Allocation Class III Division (1)		BlackRock Advantage U.S. Total Market Class III Division
Net assets as of January 1, 2018		$	1,737,815	$	703,069	$	266,497	$	150,431
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(11,163)		(2,310)		(762)		8,407
	Total realized gains (losses) on investments		184,807		33,573		9,677		111,334
	Change in net unrealized appreciation (depreciation)
	of investments		(453,843)		(200,737)		(45,856)		(209,290)
	Net gains (losses) on investments		(280,199)		(169,474)		(36,941)		(89,549)
Net increase (decrease) in net assets resulting from operations			(280,199)		(169,474)		(36,941)		(89,549)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		788,003		632,738		336,831		770,857
	Administration charges		(64)		(2,439)		(327)		(1,003)
	Contingent sales charges		(557)		(104)		(46)		—
	Contract terminations		(138,227)		(27,234)		(6,224)		—
	Death benefit payments		—		—		—		—
	Flexible withdrawal option payments		(11,144)		(4,256)		(417)		(7,132)
	Transfers to other contracts		(763,786)		(41,565)		(6,833)		(9,766)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(125,775)		557,140		322,984		752,956
Total increase (decrease)			(405,974)		387,666		286,043		663,407
Net assets as of December 31, 2018			1,331,841		1,090,735		552,540		813,838
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(6,473)		(139)		8,540		12,047
	Total realized gains (losses) on investments		107,055		57,017		17,171		76,132
	Change in net unrealized appreciation (depreciation)
	of investments		271,823		305,814		82,300		132,279
	Net gains (losses) on investments		372,405		362,692		108,011		220,458
Net increase (decrease) in net assets resulting from operations			372,405		362,692		108,011		220,458
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		489,499		820,442		417,085		96,752
	Administration charges		(3)		(3,508)		(774)		(2,119)
	Contingent sales charges		(781)		(1,053)		(339)		(630)
	Contract terminations		(207,476)		(35,746)		(11,806)		(30,590)
	Death benefit payments		—		—		(25,015)		—
	Flexible withdrawal option payments		(9,548)		(5,993)		(1,611)		(7,049)
	Transfers to other contracts		(189,093)		(44,359)		(238,849)		(88,566)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			82,598		729,783		138,691		(32,202)
Total increase (decrease)			455,003		1,092,475		246,702		188,256
Net assets as of December 31, 2019		$	1,786,844	$	2,183,210	$	799,242	$	1,002,094
(1) Represented the operations of BlackRock iShares Dynamic Allocation Class III Division until June 6, 2019.
See accompanying notes.

A-51

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		BlackRock Global Allocation Class III Division		BNY Mellon IP MidCap Stock Service Shares Division (1)		BNY Mellon IP Technology Growth Service Shares Division (2)		Calvert EAFE International Index Class F Division
Net assets as of January 1, 2018		$	1,268,238	$	161,798	$	10,254,227	$	111,229
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(5,449)		(3,045)		(165,256)		16,580
	Total realized gains (losses) on investments		77,927		34,637		1,267,740		1,758
	Change in net unrealized appreciation (depreciation)
	of investments		(222,601)		(107,221)		(1,286,839)		(88,008)
	Net gains (losses) on investments		(150,123)		(75,629)		(184,355)		(69,670)
Net increase (decrease) in net assets resulting from operations			(150,123)		(75,629)		(184,355)		(69,670)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		678,056		352,224		1,865,072		595,203
	Administration charges		(679)		(999)		(1,152)		(1,017)
	Contingent sales charges		(132)		(10)		(6,429)		(22)
	Contract terminations		(19,855)		(271)		(926,678)		(6,360)
	Death benefit payments		—		—		(49,654)		—
	Flexible withdrawal option payments		(16,363)		(5,409)		(74,208)		(470)
	Transfers to other contracts		(141,422)		(3,186)		(2,321,394)		(63,670)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			499,605		342,349		(1,514,443)		523,664
Total increase (decrease)			349,482		266,720		(1,698,798)		453,994
Net assets as of December 31, 2018			1,617,720		428,518		8,555,429		565,223
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		1,739		(3,054)		(133,041)		21,043
	Total realized gains (losses) on investments		80,727		28,863		1,724,860		185
	Change in net unrealized appreciation (depreciation)
	of investments		192,061		56,114		329,247		128,980
	Net gains (losses) on investments		274,527		81,923		1,921,066		150,208
Net increase (decrease) in net assets resulting from operations			274,527		81,923		1,921,066		150,208
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		427,327		88,785		723,074		623,468
	Administration charges		(1,107)		(1,316)		(750)		(2,722)
	Contingent sales charges		(707)		(268)		(7,344)		(444)
	Contract terminations		(129,537)		(9,249)		(1,322,246)		(15,730)
	Death benefit payments		—		(8,269)		(8,311)		—
	Flexible withdrawal option payments		(15,881)		(4,884)		(69,507)		(2,254)
	Transfers to other contracts		(32,546)		(28,358)		(1,153,683)		(9,266)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			247,549		36,441		(1,838,767)		593,052
Total increase (decrease)			522,076		118,364		82,299		743,260
Net assets as of December 31, 2019		$	2,139,796	$	546,882	$	8,637,728	$	1,308,483
(1) Represented the operations of Dreyfus IP MidCap Stock Service Shares Division until June 2, 2019.
(2) Represented the operations of Dreyfus IP Technology Growth Service Shares Division until June 2, 2019.
See accompanying notes.

A-52

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Calvert Investment Grade Bond Portfolio Class F Division (1)		Calvert Russell 2000 Small Cap Index Class F Division		Calvert S&P MidCap 400 Index Class F Division		ClearBridge Small Cap Growth Class II Division
Net assets as of January 1, 2018		$	—	$	773,413	$	1,953,709	$	373,254
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		4,260		2,998		4,852		(7,787)
	Total realized gains (losses) on investments		(31)		65,575		164,739		136,440
	Change in net unrealized appreciation (depreciation)
	of investments		(2,423)		(310,205)		(539,742)		(217,942)
	Net gains (losses) on investments		1,806		(241,632)		(370,151)		(89,289)
Net increase (decrease) in net assets resulting from operations			1,806		(241,632)		(370,151)		(89,289)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		162,975		1,238,335		1,098,671		903,008
	Administration charges		(197)		(2,525)		(4,334)		(2,046)
	Contingent sales charges		(2)		(1,531)		(1,594)		(41)
	Contract terminations		(589)		(63,209)		(101,550)		(3,329)
	Death benefit payments		—		(3,997)		—		—
	Flexible withdrawal option payments		—		(5,753)		(14,861)		(8,147)
	Transfers to other contracts		—		(213,932)		(123,555)		(58,654)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			162,187		947,388		852,777		830,791
Total increase (decrease)			163,993		705,756		482,626		741,502
Net assets as of December 31, 2018			163,993		1,479,169		2,436,335		1,114,756
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		20,153		2,736		11,209		(13,436)
	Total realized gains (losses) on investments		1,867		161,988		256,507		187,441
	Change in net unrealized appreciation (depreciation)
	of investments		(4,096)		246,207		420,984		140,223
	Net gains (losses) on investments		17,924		410,931		688,700		314,228
Net increase (decrease) in net assets resulting from operations			17,924		410,931		688,700		314,228
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		779,749		975,240		1,632,441		949,832
	Administration charges		(1,177)		(4,583)		(6,212)		(4,563)
	Contingent sales charges		(294)		(1,344)		(3,003)		(2,563)
	Contract terminations		(9,869)		(82,469)		(163,993)		(90,678)
	Death benefit payments		—		(8,375)		(12,583)		—
	Flexible withdrawal option payments		(6,426)		(9,972)		(29,525)		(8,525)
	Transfers to other contracts		(626)		(50,651)		(53,272)		(254,260)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			761,357		817,846		1,363,853		589,243
Total increase (decrease)			779,281		1,228,777		2,052,553		903,471
Net assets as of December 31, 2019		$	943,274	$	2,707,946	$	4,488,888	$	2,018,227
(1) Commenced operations June 11, 2018.
See accompanying notes.

A-53

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Columbia Limited Duration Credit Class 2 Division		Columbia Small Cap Value Class 2 Division		Core Plus Bond Class 1 Division		Delaware Limited Term Diversified Income Service Class Division
Net assets as of January 1, 2018		$	208,428	$	479,800	$	131,734,442	$	302,233
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		490		(5,602)		2,358,611		3,335
	Total realized gains (losses) on investments		(1,084)		93,416		552,964		(698)
	Change in net unrealized appreciation (depreciation)
	of investments		(1,942)		(222,161)		(6,486,857)		(6,433)
	Net gains (losses) on investments		(2,536)		(134,347)		(3,575,282)		(3,796)
Net increase (decrease) in net assets resulting from operations			(2,536)		(134,347)		(3,575,282)		(3,796)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		52,477		261,646		10,253,071		122,452
	Administration charges		(69)		(844)		(285,535)		(197)
	Contingent sales charges		(54)		(547)		(45,895)		(8)
	Contract terminations		(40,464)		(26,534)		(11,993,079)		(1,716)
	Death benefit payments		—		—		(1,399,374)		—
	Flexible withdrawal option payments		(999)		(1,684)		(3,111,179)		(872)
	Transfers to other contracts		(25,918)		(11,724)		(11,725,301)		(43,615)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(15,027)		220,313		(18,307,292)		76,044
Total increase (decrease)			(17,563)		85,966		(21,882,574)		72,248
Net assets as of December 31, 2018			190,865		565,766		109,851,868		374,481
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		2,363		(5,506)		2,180,163		4,601
	Total realized gains (losses) on investments		1,134		51,869		1,285,718		(704)
	Change in net unrealized appreciation (depreciation)
	of investments		12,508		100,412		5,630,180		8,999
	Net gains (losses) on investments		16,005		146,775		9,096,061		12,896
Net increase (decrease) in net assets resulting from operations			16,005		146,775		9,096,061		12,896
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		254,814		421,412		18,006,353		143,868
	Administration charges		(326)		(1,328)		(195,089)		(518)
	Contingent sales charges		(252)		(753)		(42,409)		(144)
	Contract terminations		(49,699)		(51,826)		(11,878,252)		(24,960)
	Death benefit payments		—		—		(1,499,990)		—
	Flexible withdrawal option payments		(1,196)		(8,787)		(2,839,355)		(2,077)
	Transfers to other contracts		(5,460)		(37,404)		(4,324,992)		(27,670)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			197,881		321,314		(2,773,734)		88,499
Total increase (decrease)			213,886		468,089		6,322,327		101,395
Net assets as of December 31, 2019		$	404,751	$	1,033,855	$	116,174,195	$	475,876
See accompanying notes.

A-54

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Delaware Small Cap Value Service Class Division		Diversified Balanced Class 1 Division		Diversified Balanced Class 2 Division		Diversified Balanced Managed Volatility Class 2 Division
Net assets as of January 1, 2018		$	2,725,902	$	27,196,938	$	1,131,092,101	$	181,076,859
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(24,469)		360,395		9,856,064		3,902,327
	Total realized gains (losses) on investments		244,329		417,059		54,916,102		3,893,627
	Change in net unrealized appreciation (depreciation)
	of investments		(725,239)		(1,819,831)		(114,144,647)		(15,661,168)
	Net gains (losses) on investments		(505,379)		(1,042,377)		(49,372,481)		(7,865,214)
Net increase (decrease) in net assets resulting from operations			(505,379)		(1,042,377)		(49,372,481)		(7,865,214)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		581,237		775,948		62,945,998		12,540,376
	Administration charges		(190)		(9,750)		(13,862,278)		(2,528,722)
	Contingent sales charges		(845)		(1,265)		(498,133)		(60,821)
	Contract terminations		(161,658)		(2,618,551)		(70,241,010)		(8,432,162)
	Death benefit payments		(2,589)		(326,084)		(6,364,296)		(534,125)
	Flexible withdrawal option payments		(23,184)		(472,393)		(24,208,989)		(3,894,633)
	Transfers to other contracts		(446,039)		(604,833)		(61,354,890)		(8,174,282)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(53,268)		(3,256,928)		(113,583,598)		(11,084,369)
Total increase (decrease)			(558,647)		(4,299,305)		(162,956,079)		(18,949,583)
Net assets as of December 31, 2018			2,167,255		22,897,633		968,136,022		162,127,276
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(16,529)		218,809		3,734,011		319,902
	Total realized gains (losses) on investments		196,713		1,117,534		84,500,620		5,564,880
	Change in net unrealized appreciation (depreciation)
	of investments		359,207		2,439,137		63,569,257		19,144,577
	Net gains (losses) on investments		539,391		3,775,480		151,803,888		25,029,359
Net increase (decrease) in net assets resulting from operations			539,391		3,775,480		151,803,888		25,029,359
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		354,337		905,367		46,705,587		13,442,090
	Administration charges		(90)		(8,346)		(10,323,389)		(2,001,598)
	Contingent sales charges		(1,082)		(1,411)		(525,698)		(72,199)
	Contract terminations		(236,671)		(1,855,657)		(90,434,349)		(11,123,886)
	Death benefit payments		—		(165,242)		(5,478,184)		(1,658,860)
	Flexible withdrawal option payments		(18,464)		(364,686)		(24,554,343)		(4,270,586)
	Transfers to other contracts		(242,105)		(239,117)		(46,906,140)		(5,213,968)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(144,075)		(1,729,092)		(131,516,516)		(10,899,007)
Total increase (decrease)			395,316		2,046,388		20,287,372		14,130,352
Net assets as of December 31, 2019		$	2,562,571	$	24,944,021	$	988,423,394	$	176,257,628
See accompanying notes.

A-55

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Diversified Balanced Volatility Control Class 2 Division		Diversified Growth Class 2 Division		Diversified Growth Managed Volatility Class 2 Division		Diversified Growth Volatility Control Class 2 Division
Net assets as of January 1, 2018		$	36,539,107	$	3,946,890,443	$	354,954,477	$	171,698,770
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(325,117)		40,377,098		9,523,141		(1,814,969)
	Total realized gains (losses) on investments		373,831		161,800,838		8,035,107		1,493,685
	Change in net unrealized appreciation (depreciation)
	of investments		(3,177,655)		(420,217,284)		(36,214,974)		(22,030,674)
	Net gains (losses) on investments		(3,128,941)		(218,039,348)		(18,656,726)		(22,351,958)
Net increase (decrease) in net assets resulting from operations			(3,128,941)		(218,039,348)		(18,656,726)		(22,351,958)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		37,551,545		203,263,067		28,017,728		249,692,004
	Administration charges		(791,968)		(50,091,951)		(4,670,847)		(4,178,100)
	Contingent sales charges		(15,925)		(1,376,847)		(108,184)		(97,789)
	Contract terminations		(492,627)		(197,003,425)		(14,477,632)		(3,024,936)
	Death benefit payments		(397,229)		(11,642,103)		(817,859)		(75,164)
	Flexible withdrawal option payments		(256,219)		(62,366,081)		(4,710,254)		(1,496,426)
	Transfers to other contracts		(2,052,112)		(122,257,591)		(14,273,565)		(5,309,689)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			33,545,465		(241,474,931)		(11,040,613)		235,509,900
Total increase (decrease)			30,416,524		(459,514,279)		(29,697,339)		213,157,942
Net assets as of December 31, 2018			66,955,631		3,487,376,164		325,257,138		384,856,712
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(416,927)		11,958,519		406,034		(2,239,587)
	Total realized gains (losses) on investments		1,326,396		295,846,413		12,349,158		5,364,547
	Change in net unrealized appreciation (depreciation)
	of investments		11,807,300		345,786,028		45,499,580		78,184,013
	Net gains (losses) on investments		12,716,769		653,590,960		58,254,772		81,308,973
Net increase (decrease) in net assets resulting from operations			12,716,769		653,590,960		58,254,772		81,308,973
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		73,949,605		147,282,936		13,726,413		324,911,924
	Administration charges		(1,317,223)		(39,331,937)		(3,749,938)		(7,257,561)
	Contingent sales charges		(21,537)		(1,441,440)		(126,843)		(178,656)
	Contract terminations		(818,931)		(255,966,308)		(21,464,539)		(6,793,358)
	Death benefit payments		(671,614)		(18,529,748)		(1,214,988)		(601,321)
	Flexible withdrawal option payments		(704,342)		(67,759,946)		(5,207,204)		(3,105,045)
	Transfers to other contracts		(4,759,904)		(132,303,218)		(11,789,734)		(7,847,186)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			65,656,054		(368,049,661)		(29,826,833)		299,128,797
Total increase (decrease)			78,372,823		285,541,299		28,427,939		380,437,770
Net assets as of December 31, 2019		$	145,328,454	$	3,772,917,463	$	353,685,077	$	765,294,482
See accompanying notes.

A-56

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Diversified Income Class 2 Division		Diversified International Class 1 Division		DWS Alternative Asset Allocation Class B Division		DWS Equity 500 Index Class B2 Division
Net assets as of January 1, 2018		$	268,176,862	$	131,186,053	$	40,426	$	1,323,534
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		1,600,767		924,639		134		1,373
	Total realized gains (losses) on investments		7,335,342		6,180,082		(207)		141,306
	Change in net unrealized appreciation (depreciation)
	of investments		(18,427,084)		(29,351,372)		(4,324)		(269,733)
	Net gains (losses) on investments		(9,490,975)		(22,246,651)		(4,397)		(127,054)
Net increase (decrease) in net assets resulting from operations			(9,490,975)		(22,246,651)		(4,397)		(127,054)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		58,634,758		7,903,818		9,273		719,978
	Administration charges		(3,427,378)		(85,152)		(82)		(3,028)
	Contingent sales charges		(133,148)		(36,154)		(10)		(861)
	Contract terminations		(17,326,851)		(13,091,919)		(2,990)		(101,759)
	Death benefit payments		(811,018)		(637,061)		—		(3,110)
	Flexible withdrawal option payments		(5,120,142)		(1,375,919)		(1,440)		(12,494)
	Transfers to other contracts		(49,099,798)		(5,815,701)		(3,359)		(104,493)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(17,283,577)		(13,138,088)		1,392		494,233
Total increase (decrease)			(26,774,552)		(35,384,739)		(3,005)		367,179
Net assets as of December 31, 2018			241,402,310		95,801,314		37,421		1,690,713
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		621,340		338,712		935		9,442
	Total realized gains (losses) on investments		11,011,451		9,701,340		(55)		107,312
	Change in net unrealized appreciation (depreciation)
	of investments		21,449,329		9,270,883		4,066		419,422
	Net gains (losses) on investments		33,082,120		19,310,935		4,946		536,176
Net increase (decrease) in net assets resulting from operations			33,082,120		19,310,935		4,946		536,176
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		65,939,995		6,385,097		3,525		374,426
	Administration charges		(2,897,238)		(61,100)		(86)		(3,924)
	Contingent sales charges		(162,331)		(30,172)		—		(640)
	Contract terminations		(26,955,062)		(11,929,073)		—		(40,903)
	Death benefit payments		(2,202,374)		(942,529)		—		—
	Flexible withdrawal option payments		(5,463,588)		(1,205,096)		(1,440)		(14,364)
	Transfers to other contracts		(22,880,114)		(3,845,569)		(86)		(50,826)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			5,379,288		(11,628,442)		1,913		263,769
Total increase (decrease)			38,461,408		7,682,493		6,859		799,945
Net assets as of December 31, 2019		$	279,863,718	$	103,483,807	$	44,280	$	2,490,658
See accompanying notes.

A-57

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		DWS Small Mid Cap Value Class B Division		EQ Convertible Securities Class IB Division (1)		EQ GAMCO Small Company Value Class IB Division (1)		EQ Micro Cap Class IB Division (1)
Net assets as of January 1, 2018		$	1,241,886	$	—	$	—	$	—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(5,145)		—		—		—
	Total realized gains (losses) on investments		188,815		—		—		—
	Change in net unrealized appreciation (depreciation)
	of investments		(416,978)		—		—		—
	Net gains (losses) on investments		(233,308)		—		—		—
Net increase (decrease) in net assets resulting from operations			(233,308)		—		—		—
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		241,345		—		—		—
	Administration charges		(692)		—		—		—
	Contingent sales charges		(852)		—		—		—
	Contract terminations		(43,636)		—		—		—
	Death benefit payments		(28,430)		—		—		—
	Flexible withdrawal option payments		(6,263)		—		—		—
	Transfers to other contracts		(85,836)		—		—		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			75,636		—		—		—
Total increase (decrease)			(157,672)		—		—		—
Net assets as of December 31, 2018			1,084,214		—		—		—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(11,921)		—		204		(18)
	Total realized gains (losses) on investments		37,708		—		1,281		965
	Change in net unrealized appreciation (depreciation)
	of investments		193,594		—		940		(410)
	Net gains (losses) on investments		219,381		—		2,425		537
Net increase (decrease) in net assets resulting from operations			219,381		—		2,425		537
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		336,747		—		52,920		9,962
	Administration charges		(905)		—		(51)		(19)
	Contingent sales charges		(693)		—		—		—
	Contract terminations		(120,429)		—		—		—
	Death benefit payments		—		—		—		—
	Flexible withdrawal option payments		(4,128)		—		—		—
	Transfers to other contracts		(44,773)		—		—		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			165,819		—		52,869		9,943
Total increase (decrease)			385,200		—		55,294		10,480
Net assets as of December 31, 2019		$	1,469,414	$	—	$	55,294	$	10,480
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-58

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		EQ SmartBeta Equity Class IB Division (1)		EQ Socially Responsible Class IB Division (1)		Equity Income Class 1 Division		Equity Income Class 2 Division
Net assets as of January 1, 2018		$	—	$	—	$	197,554,008	$	2,508,014
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		—		—		756,045		21,817
	Total realized gains (losses) on investments		—		—		26,572,416		212,018
	Change in net unrealized appreciation (depreciation)
	of investments		—		—		(41,670,303)		(543,962)
	Net gains (losses) on investments		—		—		(14,341,842)		(310,127)
Net increase (decrease) in net assets resulting from operations			—		—		(14,341,842)		(310,127)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		—		—		78,641,574		2,464,180
	Administration charges		—		—		(619,088)		(7,241)
	Contingent sales charges		—		—		(111,624)		(509)
	Contract terminations		—		—		(21,056,190)		(101,575)
	Death benefit payments		—		—		(2,343,986)		—
	Flexible withdrawal option payments		—		—		(5,311,417)		(23,324)
	Transfers to other contracts		—		—		(16,599,234)		(237,069)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			—		—		32,600,035		2,094,462
Total increase (decrease)			—		—		18,258,193		1,784,335
Net assets as of December 31, 2018			—		—		215,812,201		4,292,349
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		400		85		1,208,357		45,175
	Total realized gains (losses) on investments		781		231		23,072,453		174,456
	Change in net unrealized appreciation (depreciation)
	of investments		1,599		832		30,640,488		1,124,305
	Net gains (losses) on investments		2,780		1,148		54,921,298		1,343,936
Net increase (decrease) in net assets resulting from operations			2,780		1,148		54,921,298		1,343,936
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		59,782		16,214		5,972,692		2,302,515
	Administration charges		(3)		(26)		(446,244)		(11,716)
	Contingent sales charges		—		(22)		(101,083)		(2,315)
	Contract terminations		—		(733)		(26,011,250)		(133,901)
	Death benefit payments		—		—		(2,809,295)		—
	Flexible withdrawal option payments		(381)		—		(5,450,172)		(40,411)
	Transfers to other contracts		—		—		(12,413,317)		(85,653)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			59,398		15,433		(41,258,669)		2,028,519
Total increase (decrease)			62,178		16,581		13,662,629		3,372,455
Net assets as of December 31, 2019		$	62,178	$	16,581	$	229,474,830	$	7,664,804
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-59

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Fidelity VIP Contrafund Service Class Division		Fidelity VIP Contrafund Service Class 2 Division		Fidelity VIP Equity-Income Service Class 2 Division		Fidelity VIP Freedom 2020 Service Class 2 Division (1)
Net assets as of January 1, 2018		$	41,948,958	$	52,562,659	$	31,877,671	$	—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(284,236)		(501,099)		193,762		—
	Total realized gains (losses) on investments		5,695,764		8,221,063		2,389,268		—
	Change in net unrealized appreciation (depreciation)
	of investments		(7,947,435)		(11,302,296)		(5,446,945)		—
	Net gains (losses) on investments		(2,535,907)		(3,582,332)		(2,863,915)		—
Net increase (decrease) in net assets resulting from operations			(2,535,907)		(3,582,332)		(2,863,915)		—
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		786,614		5,583,081		1,061,271		—
	Administration charges		(6,862)		(98,717)		(5,888)		—
	Contingent sales charges		(3,409)		(38,129)		(7,060)		—
	Contract terminations		(4,883,153)		(5,463,241)		(2,611,169)		—
	Death benefit payments		(388,448)		(271,994)		(166,011)		—
	Flexible withdrawal option payments		(417,666)		(741,536)		(340,129)		—
	Transfers to other contracts		(1,548,346)		(4,025,378)		(1,426,575)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(6,461,270)		(5,055,914)		(3,495,561)		—
Total increase (decrease)			(8,997,177)		(8,638,246)		(6,359,476)		—
Net assets as of December 31, 2018			32,951,781		43,924,413		25,518,195		—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(333,085)		(563,026)		120,635		2,065
	Total realized gains (losses) on investments		5,734,709		8,707,403		2,203,854		585
	Change in net unrealized appreciation (depreciation)
	of investments		3,690,848		4,283,215		3,877,696		5,842
	Net gains (losses) on investments		9,092,472		12,427,592		6,202,185		8,492
Net increase (decrease) in net assets resulting from operations			9,092,472		12,427,592		6,202,185		8,492
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		357,822		4,257,075		1,142,273		133,714
	Administration charges		(4,743)		(76,806)		(4,853)		(153)
	Contingent sales charges		(3,893)		(31,776)		(7,255)		—
	Contract terminations		(4,621,020)		(5,389,702)		(2,814,749)		—
	Death benefit payments		(278,948)		(492,209)		(136,353)		—
	Flexible withdrawal option payments		(406,941)		(690,728)		(318,062)		—
	Transfers to other contracts		(1,226,925)		(3,295,351)		(1,000,551)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(6,184,648)		(5,719,497)		(3,139,550)		133,561
Total increase (decrease)			2,907,824		6,708,095		3,062,635		142,053
Net assets as of December 31, 2019		$	35,859,605	$	50,632,508	$	28,580,830	$	142,053
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-60

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Fidelity VIP Freedom 2030 Service Class 2 Division (1)		Fidelity VIP Freedom 2040 Service Class 2 Division (1)		Fidelity VIP Freedom 2050 Service Class 2 Division (1)		Fidelity VIP Government Money Market Initial Class Division
Net assets as of January 1, 2018		$	—	$	—	$	—	$	34,519,483
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		—		—		—		124,989
	Total realized gains (losses) on investments		—		—		—		—
	Change in net unrealized appreciation (depreciation)
	of investments		—		—		—		54
	Net gains (losses) on investments		—		—		—		125,043
Net increase (decrease) in net assets resulting from operations			—		—		—		125,043
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		—		—		—		22,074,734
	Administration charges		—		—		—		(33,590)
	Contingent sales charges		—		—		—		(19,797)
	Contract terminations		—		—		—		(7,322,997)
	Death benefit payments		—		—		—		(75,163)
	Flexible withdrawal option payments		—		—		—		(657,076)
	Transfers to other contracts		—		—		—		(7,491,410)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			—		—		—		6,474,701
Total increase (decrease)			—		—		—		6,599,744
Net assets as of December 31, 2018			—		—		—		41,119,227
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		4,331		8,774		1,688		266,726
	Total realized gains (losses) on investments		4,338		1,167		603		—
	Change in net unrealized appreciation (depreciation)
	of investments		3,841		26,451		4,898		—
	Net gains (losses) on investments		12,510		36,392		7,189		266,726
Net increase (decrease) in net assets resulting from operations			12,510		36,392		7,189		266,726
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		329,174		683,226		170,611		10,155,231
	Administration charges		(163)		(102)		(63)		(25,964)
	Contingent sales charges		(56)		—		—		(41,582)
	Contract terminations		(1,889)		—		—		(11,121,400)
	Death benefit payments		(41,394)		—		—		(965,685)
	Flexible withdrawal option payments		—		—		—		(572,868)
	Transfers to other contracts		—		—		—		(7,351,240)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			285,672		683,124		170,548		(9,923,508)
Total increase (decrease)			298,182		719,516		177,737		(9,656,782)
Net assets as of December 31, 2019		$	298,182	$	719,516	$	177,737	$	31,462,445
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-61

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Fidelity VIP Government Money Market Service Class 2 Division		Fidelity VIP Growth Service Class Division		Fidelity VIP Growth Service Class 2 Division		Fidelity VIP Mid Cap Service Class Division
Net assets as of January 1, 2018		$	3,084,003	$	14,958,345	$	11,548,238	$	673,714
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		12,762		(176,571)		(169,318)		(2,101)
	Total realized gains (losses) on investments		—		3,169,370		2,420,507		170,507
	Change in net unrealized appreciation (depreciation)
	of investments		—		(3,076,834)		(2,366,458)		(151,615)
	Net gains (losses) on investments		12,762		(84,035)		(115,269)		16,791
Net increase (decrease) in net assets resulting from operations			12,762		(84,035)		(115,269)		16,791
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		15,428,018		835,366		831,167		—
	Administration charges		(32,635)		(3,917)		(1,603)		—
	Contingent sales charges		(6,963)		(928)		(7,151)		—
	Contract terminations		(247,160)		(1,329,959)		(1,030,734)		—
	Death benefit payments		—		(102,219)		(19,460)		—
	Flexible withdrawal option payments		(16,514)		(141,700)		(100,754)		—
	Transfers to other contracts		(10,582,431)		(1,143,805)		(802,048)		(612,547)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			4,542,315		(1,887,162)		(1,130,583)		(612,547)
Total increase (decrease)			4,555,077		(1,971,197)		(1,245,852)		(595,756)
Net assets as of December 31, 2018			7,639,080		12,987,148		10,302,386		77,958
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		52,730		(161,364)		(163,244)		(129)
	Total realized gains (losses) on investments		—		2,280,640		1,227,151		9,358
	Change in net unrealized appreciation (depreciation)
	of investments		—		1,810,114		2,110,429		8,063
	Net gains (losses) on investments		52,730		3,929,390		3,174,336		17,292
Net increase (decrease) in net assets resulting from operations			52,730		3,929,390		3,174,336		17,292
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		15,455,294		306,636		714,669		—
	Administration charges		(44,757)		(2,752)		(1,329)		—
	Contingent sales charges		(9,634)		(1,732)		(6,081)		—
	Contract terminations		(555,702)		(2,056,424)		(1,094,877)		—
	Death benefit payments		—		(52,466)		(203,412)		—
	Flexible withdrawal option payments		(22,259)		(118,771)		(101,295)		—
	Transfers to other contracts		(13,664,763)		(427,848)		(497,605)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			1,158,179		(2,353,357)		(1,189,930)		—
Total increase (decrease)			1,210,909		1,576,033		1,984,406		17,292
Net assets as of December 31, 2019		$	8,849,989	$	14,563,181	$	12,286,792	$	95,250
See accompanying notes.

A-62

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Fidelity VIP Mid Cap Service Class 2 Division		Fidelity VIP Overseas Service Class 2 Division		Franklin Global Real Estate VIP Class 2 Division		Franklin Income VIP Class 4 Division (1)
Net assets as of January 1, 2018		$	25,997,638	$	28,448,188	$	715,228	$	—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(267,608)		(33,996)		11,912		(98)
	Total realized gains (losses) on investments		2,638,505		1,504,811		32		(536)
	Change in net unrealized appreciation (depreciation)
	of investments		(6,524,536)		(5,715,975)		(72,281)		(2,184)
	Net gains (losses) on investments		(4,153,639)		(4,245,160)		(60,337)		(2,818)
Net increase (decrease) in net assets resulting from operations			(4,153,639)		(4,245,160)		(60,337)		(2,818)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		3,931,897		3,071,886		222,863		89,411
	Administration charges		(9,728)		(99,723)		(946)		(72)
	Contingent sales charges		(14,078)		(14,207)		(111)		—
	Contract terminations		(1,972,255)		(2,066,656)		(34,916)		—
	Death benefit payments		(107,394)		(302,768)		—		—
	Flexible withdrawal option payments		(155,346)		(682,284)		(749)		—
	Transfers to other contracts		(1,724,608)		(1,732,508)		(50,582)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(51,512)		(1,826,260)		135,559		89,339
Total increase (decrease)			(4,205,151)		(6,071,420)		75,222		86,521
Net assets as of December 31, 2018			21,792,487		22,376,768		790,450		86,521
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(163,979)		16,243		11,770		24,631
	Total realized gains (losses) on investments		2,042,644		2,751,034		23,464		9,270
	Change in net unrealized appreciation (depreciation)
	of investments		2,756,548		2,595,098		139,722		30,265
	Net gains (losses) on investments		4,635,213		5,362,375		174,956		64,166
Net increase (decrease) in net assets resulting from operations			4,635,213		5,362,375		174,956		64,166
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		4,304,734		1,292,158		509,082		1,113,017
	Administration charges		(14,225)		(67,975)		(1,215)		(944)
	Contingent sales charges		(15,338)		(17,299)		(246)		(153)
	Contract terminations		(2,209,487)		(3,072,700)		(46,102)		(5,137)
	Death benefit payments		(85,925)		(179,895)		—		—
	Flexible withdrawal option payments		(166,826)		(599,556)		(1,508)		(4,745)
	Transfers to other contracts		(2,306,293)		(1,603,451)		(28,207)		(7)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(493,360)		(4,248,718)		431,804		1,102,031
Total increase (decrease)			4,141,853		1,113,657		606,760		1,166,197
Net assets as of December 31, 2019		$	25,934,340	$	23,490,425	$	1,397,210	$	1,252,718
(1) Commenced operations June 11, 2018.
See accompanying notes.

A-63

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Franklin Rising Dividends VIP Class 4 Division		Franklin Small Cap Value VIP Class 2 Division		Franklin U.S. Government Fund Class 2 Division (1)		Goldman Sachs VIT Mid Cap Value Institutional Shares Division
Net assets as of January 1, 2018		$	1,338,635	$	4,897,184	$	—	$	13,513,944
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		908		(27,023)		—		(20,462)
	Total realized gains (losses) on investments		84,938		521,084		—		1,699,111
	Change in net unrealized appreciation (depreciation)
	of investments		(192,704)		(1,092,891)		—		(3,099,240)
	Net gains (losses) on investments		(106,858)		(598,830)		—		(1,420,591)
Net increase (decrease) in net assets resulting from operations			(106,858)		(598,830)		—		(1,420,591)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		516,561		302,662		—		329,950
	Administration charges		(3,301)		(45)		—		(634)
	Contingent sales charges		(350)		(3,165)		—		(8,628)
	Contract terminations		(48,312)		(467,562)		—		(1,243,662)
	Death benefit payments		(5,362)		(47,022)		—		(54,862)
	Flexible withdrawal option payments		(2,472)		(24,560)		—		(99,587)
	Transfers to other contracts		(209,018)		(411,697)		—		(338,000)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			247,746		(651,389)		—		(1,415,423)
Total increase (decrease)			140,888		(1,250,219)		—		(2,836,014)
Net assets as of December 31, 2018			1,479,523		3,646,965		—		10,677,930
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		1,872		(15,987)		(322)		(78,279)
	Total realized gains (losses) on investments		307,264		480,650		11		346,567
	Change in net unrealized appreciation (depreciation)
	of investments		163,124		385,729		322		2,732,906
	Net gains (losses) on investments		472,260		850,392		11		3,001,194
Net increase (decrease) in net assets resulting from operations			472,260		850,392		11		3,001,194
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,072,683		341,987		323,162		386,727
	Administration charges		(5,237)		(35)		(168)		(532)
	Contingent sales charges		(864)		(2,441)		—		(7,948)
	Contract terminations		(54,838)		(457,557)		—		(1,444,623)
	Death benefit payments		(11,828)		(64,713)		—		(309,879)
	Flexible withdrawal option payments		(7,351)		(19,302)		—		(76,807)
	Transfers to other contracts		(102,379)		(250,946)		(374)		(390,861)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			890,186		(453,007)		322,620		(1,843,923)
Total increase (decrease)			1,362,446		397,385		322,631		1,157,271
Net assets as of December 31, 2019		$	2,841,969	$	4,044,350	$	322,631	$	11,835,201
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-64

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
				Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares Division
		Goldman Sachs VIT Mid Cap Value Service Shares Division				Goldman Sachs VIT Small Cap Equity Insights Institutional Shares Division		Goldman Sachs VIT Small Cap Equity Insights Service Shares Division
Net assets as of January 1, 2018		$	558,164	$	1,540	$	6,851,961	$	186,761
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(3,692)		1,024		(67,198)		(2,346)
	Total realized gains (losses) on investments		84,360		(52)		1,136,320		56,674
	Change in net unrealized appreciation (depreciation)
	of investments		(168,196)		(3,570)		(1,681,780)		(97,355)
	Net gains (losses) on investments		(87,528)		(2,598)		(612,658)		(43,027)
Net increase (decrease) in net assets resulting from operations			(87,528)		(2,598)		(612,658)		(43,027)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		246,884		48,320		586,100		206,003
	Administration charges		(1,037)		(87)		(98)		(736)
	Contingent sales charges		(151)		—		(3,435)		(26)
	Contract terminations		(43,638)		—		(501,065)		(3,792)
	Death benefit payments		(1,743)		—		(35,317)		—
	Flexible withdrawal option payments		(2,689)		—		(45,167)		(800)
	Transfers to other contracts		(10,236)		(768)		(512,637)		(7,383)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			187,390		47,465		(511,619)		193,266
Total increase (decrease)			99,862		44,867		(1,124,277)		150,239
Net assets as of December 31, 2018			658,026		46,407		5,727,684		337,000
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(2,841)		1,333		(58,023)		(3,112)
	Total realized gains (losses) on investments		42,911		(78)		(150,821)		5,058
	Change in net unrealized appreciation (depreciation)
	of investments		190,535		2,912		1,444,467		90,363
	Net gains (losses) on investments		230,605		4,167		1,235,623		92,309
Net increase (decrease) in net assets resulting from operations			230,605		4,167		1,235,623		92,309
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		587,437		18,252		288,382		221,981
	Administration charges		(1,926)		(211)		(122)		(999)
	Contingent sales charges		(289)		(6)		(4,596)		(446)
	Contract terminations		(17,974)		(265)		(827,900)		(14,963)
	Death benefit payments		—		—		(21,182)		—
	Flexible withdrawal option payments		(3,986)		(50)		(53,911)		(2,671)
	Transfers to other contracts		(6,968)		(582)		(428,094)		(5,344)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			556,294		17,138		(1,047,423)		197,558
Total increase (decrease)			786,899		21,305		188,200		289,867
Net assets as of December 31, 2019		$	1,444,925	$	67,712	$	5,915,884	$	626,867
See accompanying notes.

A-65

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Guggenheim Investments Multi-Hedge Strategies Division		International Emerging Markets Class 1 Division		Invesco American Franchise Series I Division		Invesco Balanced-Risk Allocation Series II Division
Net assets as of January 1, 2018		$	536,633	$	59,752,743	$	4,467,834	$	266,272
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(7,748)		(106,366)		(59,058)		314
	Total realized gains (losses) on investments		(520)		2,311,424		551,578		28,526
	Change in net unrealized appreciation (depreciation)
	of investments		(28,353)		(14,162,851)		(664,227)		(55,192)
	Net gains (losses) on investments		(36,621)		(11,957,793)		(171,707)		(26,352)
Net increase (decrease) in net assets resulting from operations			(36,621)		(11,957,793)		(171,707)		(26,352)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		131,013		6,804,940		130,090		72,148
	Administration charges		(388)		(8,244)		(1,089)		(690)
	Contingent sales charges		(48)		(32,870)		(198)		(19)
	Contract terminations		(15,525)		(7,126,409)		(283,858)		(531)
	Death benefit payments		—		(173,259)		(49,495)		—
	Flexible withdrawal option payments		(410)		(375,517)		(62,821)		—
	Transfers to other contracts		(75,997)		(5,884,760)		(203,236)		(748)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			38,645		(6,796,119)		(470,607)		70,160
Total increase (decrease)			2,024		(18,753,912)		(642,314)		43,808
Net assets as of December 31, 2018			538,657		40,998,831		3,825,520		310,080
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		5,804		(172,823)		(56,364)		(4,338)
	Total realized gains (losses) on investments		225		1,571,045		974,866		(4,186)
	Change in net unrealized appreciation (depreciation)
	of investments		13,267		4,885,242		326,403		54,256
	Net gains (losses) on investments		19,296		6,283,464		1,244,905		45,732
Net increase (decrease) in net assets resulting from operations			19,296		6,283,464		1,244,905		45,732
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		27,174		5,325,030		92,009		155,166
	Administration charges		(367)		(9,248)		(851)		(779)
	Contingent sales charges		(69)		(21,911)		(521)		(296)
	Contract terminations		(12,337)		(5,806,117)		(618,229)		(20,201)
	Death benefit payments		—		(394,153)		(61,321)		—
	Flexible withdrawal option payments		(391)		(339,007)		(53,990)		—
	Transfers to other contracts		(13,019)		(2,969,118)		(121,146)		(944)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			991		(4,214,524)		(764,049)		132,946
Total increase (decrease)			20,287		2,068,940		480,856		178,678
Net assets as of December 31, 2019		$	558,944	$	43,067,771	$	4,306,376	$	488,758
See accompanying notes.

A-66

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Invesco Core Equity Series I Division		Invesco Health Care Series I Division		Invesco Health Care Series II Division		Invesco International Growth Series I Division
Net assets as of January 1, 2018		$	16,763,993	$	7,457,788	$	1,027,913	$	9,527,606
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(66,620)		(94,482)		(13,163)		47,790
	Total realized gains (losses) on investments		1,828,672		1,031,190		125,334		500,222
	Change in net unrealized appreciation (depreciation)
	of investments		(3,263,203)		(931,133)		(141,599)		(1,906,439)
	Net gains (losses) on investments		(1,501,151)		5,575		(29,428)		(1,358,427)
Net increase (decrease) in net assets resulting from operations			(1,501,151)		5,575		(29,428)		(1,358,427)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		324,506		468,655		635,227		706,679
	Administration charges		(2,503)		(1,351)		(3,156)		(15,630)
	Contingent sales charges		(1,028)		(887)		(578)		(8,169)
	Contract terminations		(1,472,340)		(815,208)		(139,662)		(1,177,492)
	Death benefit payments		(93,410)		(57,045)		(3,536)		(76,052)
	Flexible withdrawal option payments		(231,471)		(100,526)		(3,913)		(88,231)
	Transfers to other contracts		(1,268,946)		(487,704)		(169,661)		(918,081)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(2,745,192)		(994,066)		314,721		(1,576,976)
Total increase (decrease)			(4,246,343)		(988,491)		285,293		(2,935,403)
Net assets as of December 31, 2018			12,517,650		6,469,297		1,313,206		6,592,203
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(51,201)		(85,790)		(19,030)		4,630
	Total realized gains (losses) on investments		2,153,158		(68,527)		38,176		567,319
	Change in net unrealized appreciation (depreciation)
	of investments		1,103,853		1,930,700		531,392		1,068,605
	Net gains (losses) on investments		3,205,810		1,776,383		550,538		1,640,554
Net increase (decrease) in net assets resulting from operations			3,205,810		1,776,383		550,538		1,640,554
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		170,629		249,595		1,206,134		378,967
	Administration charges		(1,855)		(938)		(5,211)		(11,682)
	Contingent sales charges		(1,273)		(963)		(1,140)		(4,184)
	Contract terminations		(1,511,228)		(943,217)		(85,174)		(753,222)
	Death benefit payments		(200,210)		(5,452)		(11,396)		(28,283)
	Flexible withdrawal option payments		(192,850)		(76,772)		(10,063)		(77,387)
	Transfers to other contracts		(439,309)		(449,715)		(80,198)		(798,094)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(2,176,096)		(1,227,462)		1,012,952		(1,293,885)
Total increase (decrease)			1,029,714		548,921		1,563,490		346,669
Net assets as of December 31, 2019		$	13,547,364	$	7,018,218	$	2,876,696	$	6,938,872
See accompanying notes.

A-67

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Invesco International Growth Series II Division		Invesco Mid Cap Growth Series I Division		Invesco Oppenheimer V.I. Main Street Small Cap Series II Division (1)		Invesco Small Cap Equity Series I Division
Net assets as of January 1, 2018		$	665,216	$	1,208,884	$	602,127	$	7,854,544
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		6,665		(16,213)		(6,339)		(102,512)
	Total realized gains (losses) on investments		7,195		156,424		67,785		557,254
	Change in net unrealized appreciation (depreciation)
	of investments		(158,987)		(207,235)		(112,224)		(1,481,969)
	Net gains (losses) on investments		(145,127)		(67,024)		(50,778)		(1,027,227)
Net increase (decrease) in net assets resulting from operations			(145,127)		(67,024)		(50,778)		(1,027,227)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		377,429		191,886		92,167		472,452
	Administration charges		(1,282)		(238)		(66)		(10,396)
	Contingent sales charges		(113)		(118)		(16)		(4,757)
	Contract terminations		(15,431)		(168,998)		(22,637)		(838,885)
	Death benefit payments		—		—		(600)		(140,436)
	Flexible withdrawal option payments		(9,766)		(19,171)		(1,196)		(90,627)
	Transfers to other contracts		(9,977)		(103,450)		(217,286)		(623,190)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			340,860		(100,089)		(149,634)		(1,235,839)
Total increase (decrease)			195,733		(167,113)		(200,412)		(2,263,066)
Net assets as of December 31, 2018			860,949		1,041,771		401,715		5,591,478
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		4,610		(14,698)		(5,779)		(90,284)
	Total realized gains (losses) on investments		84,942		161,987		41,999		498,849
	Change in net unrealized appreciation (depreciation)
	of investments		180,327		171,323		59,327		954,401
	Net gains (losses) on investments		269,879		318,612		95,547		1,362,966
Net increase (decrease) in net assets resulting from operations			269,879		318,612		95,547		1,362,966
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		638,020		28,222		37,485		522,309
	Administration charges		(2,536)		(178)		(82)		(7,849)
	Contingent sales charges		(228)		(210)		(29)		(1,893)
	Contract terminations		(8,255)		(249,249)		(33,883)		(491,151)
	Death benefit payments		—		—		—		(4,012)
	Flexible withdrawal option payments		(16,431)		(15,061)		(1,232)		(78,722)
	Transfers to other contracts		(49,798)		(44,933)		(51,548)		(345,316)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			560,772		(281,409)		(49,289)		(406,634)
Total increase (decrease)			830,651		37,203		46,258		956,332
Net assets as of December 31, 2019		$	1,691,600	$	1,078,974	$	447,973	$	6,547,810
(1) Represented the operations of Oppenheimer Main Street Small Cap Service Shares Division until May 24, 2019.
See accompanying notes.

A-68

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Invesco Technology Series I Division		Invesco Value Opportunities Series I Division		Janus Henderson Enterprise Service Shares Division		Janus Henderson Flexible Bond Service Shares Division
Net assets as of January 1, 2018		$	3,692,255	$	4,384,879	$	9,775,296	$	2,164,643
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(47,841)		(43,538)		(114,024)		25,024
	Total realized gains (losses) on investments		408,230		222,283		1,519,276		(33,900)
	Change in net unrealized appreciation (depreciation)
	of investments		(351,387)		(911,597)		(1,513,581)		(42,489)
	Net gains (losses) on investments		9,002		(732,852)		(108,329)		(51,365)
Net increase (decrease) in net assets resulting from operations			9,002		(732,852)		(108,329)		(51,365)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		475,208		325,699		557,824		535,559
	Administration charges		(324)		(14,723)		(2,220)		(2,108)
	Contingent sales charges		(285)		(3,429)		(668)		(403)
	Contract terminations		(407,825)		(494,217)		(956,326)		(74,459)
	Death benefit payments		(95,803)		(8,717)		(35,632)		(3,417)
	Flexible withdrawal option payments		(44,855)		(67,899)		(63,139)		(25,228)
	Transfers to other contracts		(580,803)		(483,263)		(574,526)		(685,266)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(654,687)		(746,549)		(1,074,687)		(255,322)
Total increase (decrease)			(645,685)		(1,479,401)		(1,183,016)		(306,687)
Net assets as of December 31, 2018			3,046,570		2,905,478		8,592,280		1,857,956
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(40,921)		(38,429)		(124,065)		44,918
	Total realized gains (losses) on investments		532,746		392,134		1,688,471		237
	Change in net unrealized appreciation (depreciation)
	of investments		433,265		448,184		1,213,597		123,943
	Net gains (losses) on investments		925,090		801,889		2,778,003		169,098
Net increase (decrease) in net assets resulting from operations			925,090		801,889		2,778,003		169,098
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		147,274		340,357		457,116		1,321,164
	Administration charges		(286)		(10,277)		(1,754)		(2,334)
	Contingent sales charges		(489)		(2,066)		(992)		(682)
	Contract terminations		(580,088)		(371,928)		(1,177,694)		(83,777)
	Death benefit payments		(8,570)		—		(18,949)		(20,635)
	Flexible withdrawal option payments		(28,702)		(58,128)		(53,542)		(20,194)
	Transfers to other contracts		(462,340)		(287,684)		(507,173)		(105,029)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(933,201)		(389,726)		(1,302,988)		1,088,513
Total increase (decrease)			(8,111)		412,163		1,475,015		1,257,611
Net assets as of December 31, 2019		$	3,038,459	$	3,317,641	$	10,067,295	$	3,115,567
See accompanying notes.

A-69

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Janus Henderson Global Technology Service Shares Division (1)		LargeCap Growth I Class 1 Division		LargeCap S&P 500 Index Class 1 Division		LargeCap S&P 500 Index Class 2 Division
Net assets as of January 1, 2018		$	—	$	112,163,935	$	104,390,822	$	3,235,043
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		—		(1,498,505)		365,098		45,158
	Total realized gains (losses) on investments		—		15,783,396		12,383,458		250,771
	Change in net unrealized appreciation (depreciation)
	of investments		—		(10,937,857)		(18,120,279)		(859,123)
	Net gains (losses) on investments		—		3,347,034		(5,371,723)		(563,194)
Net increase (decrease) in net assets resulting from operations			—		3,347,034		(5,371,723)		(563,194)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		—		6,084,659		8,724,026		4,730,271
	Administration charges		—		(33,196)		(57,937)		(10,660)
	Contingent sales charges		—		(22,493)		(33,286)		(2,648)
	Contract terminations		—		(10,253,450)		(9,612,324)		(108,386)
	Death benefit payments		—		(822,050)		(641,672)		—
	Flexible withdrawal option payments		—		(1,131,561)		(1,358,328)		(28,844)
	Transfers to other contracts		—		(6,530,248)		(7,492,770)		(171,635)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			—		(12,708,339)		(10,472,291)		4,408,098
Total increase (decrease)			—		(9,361,305)		(15,844,014)		3,844,904
Net assets as of December 31, 2018			—		102,802,630		88,546,808		7,079,947
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(622)		(1,766,218)		513,565		136,360
	Total realized gains (losses) on investments		210		22,244,194		12,389,698		627,806
	Change in net unrealized appreciation (depreciation)
	of investments		25,001		17,797,460		11,618,691		1,957,657
	Net gains (losses) on investments		24,589		38,275,436		24,521,954		2,721,823
Net increase (decrease) in net assets resulting from operations			24,589		38,275,436		24,521,954		2,721,823
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		325,614		55,899,675		3,993,973		6,991,181
	Administration charges		(197)		(61,439)		(42,196)		(24,142)
	Contingent sales charges		—		(31,815)		(30,388)		(4,456)
	Contract terminations		—		(16,081,195)		(11,209,850)		(193,704)
	Death benefit payments		—		(1,750,829)		(705,983)		(43,155)
	Flexible withdrawal option payments		—		(1,475,175)		(1,336,707)		(53,185)
	Transfers to other contracts		(1,814)		(8,607,753)		(4,132,556)		(637,861)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			323,603		27,891,469		(13,463,707)		6,034,678
Total increase (decrease)			348,192		66,166,905		11,058,247		8,756,501
Net assets as of December 31, 2019		$	348,192	$	168,969,535	$	99,605,055	$	15,836,448
(1) Commenced operations June 7, 2019.
See accompanying notes.

A-70

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		MFS International Intrinsic Value Service Class Division (1)		MFS New Discovery Service Class Division		MFS Utilities Service Class Division		MFS Value Service Class Division
Net assets as of January 1, 2018		$	6,697,734	$	1,497,048	$	13,276,004	$	6,238,908
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(25,406)		(28,928)		(75,014)		(10,467)
	Total realized gains (losses) on investments		332,315		390,401		(193,173)		505,489
	Change in net unrealized appreciation (depreciation)
	of investments		(1,068,216)		(584,728)		163,854		(1,119,990)
	Net gains (losses) on investments		(761,307)		(223,255)		(104,333)		(624,968)
Net increase (decrease) in net assets resulting from operations			(761,307)		(223,255)		(104,333)		(624,968)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		2,015,034		1,759,138		1,532,777		573,815
	Administration charges		(4,371)		(1,419)		(3,926)		(277)
	Contingent sales charges		(3,080)		(733)		(7,205)		(5,560)
	Contract terminations		(501,821)		(52,778)		(1,072,991)		(801,478)
	Death benefit payments		(4,312)		(33,614)		(77,647)		(724)
	Flexible withdrawal option payments		(42,866)		(30,782)		(104,941)		(53,233)
	Transfers to other contracts		(1,677,728)		(450,301)		(1,049,320)		(645,530)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(219,144)		1,189,511		(783,253)		(932,987)
Total increase (decrease)			(980,451)		966,256		(887,586)		(1,557,955)
Net assets as of December 31, 2018			5,717,283		2,463,304		12,388,418		4,680,953
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		15,924		(46,892)		352,152		23,441
	Total realized gains (losses) on investments		359,038		939,941		(102,330)		234,008
	Change in net unrealized appreciation (depreciation)
	of investments		1,023,593		250,524		2,611,742		971,917
	Net gains (losses) on investments		1,398,555		1,143,573		2,861,564		1,229,366
Net increase (decrease) in net assets resulting from operations			1,398,555		1,143,573		2,861,564		1,229,366
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,614,093		2,204,502		2,913,777		669,885
	Administration charges		(4,680)		(4,190)		(6,580)		(229)
	Contingent sales charges		(2,826)		(2,510)		(7,674)		(3,033)
	Contract terminations		(503,270)		(370,555)		(1,212,561)		(546,096)
	Death benefit payments		(3,378)		—		(400,308)		(51,676)
	Flexible withdrawal option payments		(35,728)		(45,400)		(149,056)		(48,465)
	Transfers to other contracts		(695,143)		(582,083)		(1,103,478)		(638,446)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			369,068		1,199,764		34,120		(618,060)
Total increase (decrease)			1,767,623		2,343,337		2,895,684		611,306
Net assets as of December 31, 2019		$	7,484,906	$	4,806,641	$	15,284,102	$	5,292,259
(1) Represented the operations of MFS International Value Service Class Division until June 6, 2019.
See accompanying notes.

A-71

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		MidCap Class 1 Division		Neuberger Berman AMT Mid Cap Growth Portfolio Class S Division		Neuberger Berman AMT Sustainable Equity Class I Division		Neuberger Berman AMT Sustainable Equity Class S Division (1)
Net assets as of January 1, 2018		$	351,847,210	$	2,598,506	$	4,355,135	$	—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(3,470,289)		(38,099)		(37,130)		2
	Total realized gains (losses) on investments		64,398,236		318,504		730,145		(286)
	Change in net unrealized appreciation (depreciation)
	of investments		(84,185,785)		(507,941)		(893,064)		(126)
	Net gains (losses) on investments		(23,257,838)		(227,536)		(200,049)		(410)
Net increase (decrease) in net assets resulting from operations			(23,257,838)		(227,536)		(200,049)		(410)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		11,081,798		750,610		321,603		10,781
	Administration charges		(304,557)		(4,337)		(19,485)		(1)
	Contingent sales charges		(100,029)		(1,648)		(3,865)		(1)
	Contract terminations		(33,444,054)		(233,406)		(557,164)		(181)
	Death benefit payments		(2,413,752)		(4,809)		(16,195)		—
	Flexible withdrawal option payments		(4,551,400)		(22,313)		(88,288)		—
	Transfers to other contracts		(15,350,029)		(401,798)		(586,949)		(8,682)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(45,082,023)		82,299		(950,343)		1,916
Total increase (decrease)			(68,339,861)		(145,237)		(1,150,392)		1,506
Net assets as of December 31, 2018			283,507,349		2,453,269		3,204,743		1,506
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(3,397,099)		(39,535)		(53,606)		7
	Total realized gains (losses) on investments		67,777,369		339,120		828,470		663
	Change in net unrealized appreciation (depreciation)
	of investments		45,967,907		464,714		202,087		430
	Net gains (losses) on investments		110,348,177		764,299		976,951		1,100
Net increase (decrease) in net assets resulting from operations			110,348,177		764,299		976,951		1,100
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		9,681,901		989,491		3,972,039		14,856
	Administration charges		(222,347)		(5,278)		(13,400)		(14)
	Contingent sales charges		(99,038)		(2,172)		(5,994)		—
	Contract terminations		(36,849,537)		(304,518)		(1,079,093)		—
	Death benefit payments		(3,673,104)		(12,863)		(137,595)		—
	Flexible withdrawal option payments		(4,328,708)		(24,535)		(81,785)		—
	Transfers to other contracts		(19,885,148)		(351,589)		(201,992)		(1,886)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(55,375,981)		288,536		2,452,180		12,956
Total increase (decrease)			54,972,196		1,052,835		3,429,131		14,056
Net assets as of December 31, 2019		$	338,479,545	$	3,506,104	$	6,633,874	$	15,562
(1) Commenced operations June 11, 2018.
See accompanying notes.

A-72

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		PIMCO All Asset Administrative Class Division		PIMCO All Asset Advisor Class Division		PIMCO Commodity Real Return Strategy M Class Division		PIMCO High Yield Administrative Class Division
Net assets as of January 1, 2018		$	3,688,301	$	97,812	$	10,627	$	21,731,394
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		52,643		1,859		57		724,718
	Total realized gains (losses) on investments		(30,509)		1,167		(176)		(240,898)
	Change in net unrealized appreciation (depreciation)
	of investments		(237,187)		(9,885)		(3,877)		(1,268,626)
	Net gains (losses) on investments		(215,053)		(6,859)		(3,996)		(784,806)
Net increase (decrease) in net assets resulting from operations			(215,053)		(6,859)		(3,996)		(784,806)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		352,284		16,377		38,424		2,435,213
	Administration charges		(42)		(193)		(20)		(5,316)
	Contingent sales charges		(3,428)		—		(5)		(16,128)
	Contract terminations		(494,108)		—		(153)		(2,043,898)
	Death benefit payments		(22,093)		—		—		(204,632)
	Flexible withdrawal option payments		(61,090)		—		—		(255,623)
	Transfers to other contracts		(497,332)		(6,691)		(1,069)		(2,932,830)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(725,809)		9,493		37,177		(3,023,214)
Total increase (decrease)			(940,862)		2,634		33,181		(3,808,020)
Net assets as of December 31, 2018			2,747,439		100,446		43,808		17,923,374
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		37,455		1,758		1,598		682,969
	Total realized gains (losses) on investments		(63,142)		196		(944)		(136,964)
	Change in net unrealized appreciation (depreciation)
	of investments		280,847		8,554		3,743		1,771,178
	Net gains (losses) on investments		255,160		10,508		4,397		2,317,183
Net increase (decrease) in net assets resulting from operations			255,160		10,508		4,397		2,317,183
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		161,892		2,418		7,213		3,214,331
	Administration charges		—		(201)		(168)		(7,127)
	Contingent sales charges		(2,063)		—		(4)		(10,395)
	Contract terminations		(371,482)		—		(176)		(1,781,490)
	Death benefit payments		(39,518)		—		—		(339,641)
	Flexible withdrawal option payments		(52,877)		—		(903)		(258,862)
	Transfers to other contracts		(279,868)		(785)		(2,691)		(1,062,291)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(583,916)		1,432		3,271		(245,475)
Total increase (decrease)			(328,756)		11,940		7,668		2,071,708
Net assets as of December 31, 2019		$	2,418,683	$	112,386	$	51,476	$	19,995,082
See accompanying notes.

A-73

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		PIMCO Low Duration Advisor Class Division		PIMCO Total Return Administrative Class Division		Principal Capital Appreciation Class 1 Division		Principal Capital Appreciation Class 2 Division
Net assets as of January 1, 2018		$	392,470	$	26,016,136	$	112,554,315	$	999,171
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		3,647		257,756		(286,518)		628
	Total realized gains (losses) on investments		(4,692)		(322,664)		9,885,087		117,597
	Change in net unrealized appreciation (depreciation)
	of investments		(3,712)		(446,136)		(13,540,449)		(269,776)
	Net gains (losses) on investments		(4,757)		(511,044)		(3,941,880)		(151,551)
Net increase (decrease) in net assets resulting from operations			(4,757)		(511,044)		(3,941,880)		(151,551)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,182,756		2,922,114		4,553,932		1,558,678
	Administration charges		(365)		(4,057)		(223,855)		(4,908)
	Contingent sales charges		(178)		(26,132)		(51,549)		(1,517)
	Contract terminations		(33,689)		(3,785,673)		(10,083,321)		(65,659)
	Death benefit payments		—		(102,824)		(903,342)		(5,425)
	Flexible withdrawal option payments		(3,732)		(400,204)		(2,187,907)		(9,347)
	Transfers to other contracts		(504,005)		(2,485,192)		(8,287,659)		(174,980)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			640,787		(3,881,968)		(17,183,701)		1,296,842
Total increase (decrease)			636,030		(4,393,012)		(21,125,581)		1,145,291
Net assets as of December 31, 2018			1,028,500		21,623,124		91,428,734		2,144,462
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		16,403		366,519		171,149		23,784
	Total realized gains (losses) on investments		4,074		(222,581)		13,441,306		355,171
	Change in net unrealized appreciation (depreciation)
	of investments		7,635		1,307,644		12,272,884		471,338
	Net gains (losses) on investments		28,112		1,451,582		25,885,339		850,293
Net increase (decrease) in net assets resulting from operations			28,112		1,451,582		25,885,339		850,293
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,230,075		4,521,241		2,265,862		2,604,147
	Administration charges		(973)		(6,739)		(150,636)		(9,157)
	Contingent sales charges		(1,730)		(15,489)		(47,216)		(3,951)
	Contract terminations		(198,730)		(2,573,947)		(11,933,726)		(152,931)
	Death benefit payments		—		(208,832)		(1,369,645)		—
	Flexible withdrawal option payments		(13,518)		(352,498)		(1,943,632)		(22,167)
	Transfers to other contracts		(545,932)		(1,517,135)		(6,708,312)		(132,968)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			469,192		(153,399)		(19,887,305)		2,282,973
Total increase (decrease)			497,304		1,298,183		5,998,034		3,133,266
Net assets as of December 31, 2019		$	1,525,804	$	22,921,307	$	97,426,768	$	5,277,728
See accompanying notes.

A-74

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Principal LifeTime 2010 Class 1 Division		Principal LifeTime 2020 Class 1 Division		Principal LifeTime 2030 Class 1 Division		Principal LifeTime 2040 Class 1 Division
Net assets as of January 1, 2018		$	24,297,433	$	104,894,330	$	68,464,637	$	15,164,087
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		311,111		1,168,395		577,821		93,252
	Total realized gains (losses) on investments		2,257,576		10,042,987		4,974,375		959,741
	Change in net unrealized appreciation (depreciation)
	of investments		(3,578,113)		(17,238,827)		(10,456,268)		(2,363,896)
	Net gains (losses) on investments		(1,009,426)		(6,027,445)		(4,904,072)		(1,310,903)
Net increase (decrease) in net assets resulting from operations			(1,009,426)		(6,027,445)		(4,904,072)		(1,310,903)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		628,286		2,887,583		3,200,586		510,792
	Administration charges		(82,130)		(532,118)		(384,195)		(5,043)
	Contingent sales charges		(18,046)		(61,413)		(65,150)		(5,660)
	Contract terminations		(2,668,055)		(9,516,705)		(9,566,699)		(860,788)
	Death benefit payments		(1,253,029)		(671,767)		—		—
	Flexible withdrawal option payments		(954,790)		(3,248,295)		(1,332,083)		(29,193)
	Transfers to other contracts		(1,380,883)		(4,720,580)		(817,854)		(493,219)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(5,728,647)		(15,863,295)		(8,965,395)		(883,111)
Total increase (decrease)			(6,738,073)		(21,890,740)		(13,869,467)		(2,194,014)
Net assets as of December 31, 2018			17,559,360		83,003,590		54,595,170		12,970,073
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		244,231		856,429		371,311		67,300
	Total realized gains (losses) on investments		1,442,283		8,492,660		5,166,094		1,326,258
	Change in net unrealized appreciation (depreciation)
	of investments		377,927		3,601,273		5,019,700		1,558,385
	Net gains (losses) on investments		2,064,441		12,950,362		10,557,105		2,951,943
Net increase (decrease) in net assets resulting from operations			2,064,441		12,950,362		10,557,105		2,951,943
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		238,748		3,017,400		3,741,072		1,757,962
	Administration charges		(48,778)		(363,074)		(249,778)		(7,110)
	Contingent sales charges		(6,545)		(41,722)		(41,129)		(10,156)
	Contract terminations		(1,212,259)		(8,586,008)		(7,647,216)		(1,807,050)
	Death benefit payments		(525,439)		(1,589,979)		(356,024)		(25,046)
	Flexible withdrawal option payments		(848,098)		(3,071,940)		(1,205,431)		(32,715)
	Transfers to other contracts		(371,887)		(2,732,397)		(1,823,307)		(223,871)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(2,774,258)		(13,367,720)		(7,581,813)		(347,986)
Total increase (decrease)			(709,817)		(417,358)		2,975,292		2,603,957
Net assets as of December 31, 2019		$	16,849,543	$	82,586,232	$	57,570,462	$	15,574,030
See accompanying notes.

A-75

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Principal LifeTime 2050 Class 1 Division		Principal LifeTime Strategic Income Class 1 Division		Real Estate Securities Class 1 Division		Real Estate Securities Class 2 Division
Net assets as of January 1, 2018		$	11,286,978	$	15,183,765	$	75,317,625	$	2,536,776
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		71,952		152,873		279,047		17,956
	Total realized gains (losses) on investments		805,456		640,078		8,547,778		227,215
	Change in net unrealized appreciation (depreciation)
	of investments		(1,948,794)		(1,344,295)		(12,652,684)		(402,912)
	Net gains (losses) on investments		(1,071,386)		(551,344)		(3,825,859)		(157,741)
Net increase (decrease) in net assets resulting from operations			(1,071,386)		(551,344)		(3,825,859)		(157,741)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		759,700		585,659		3,833,843		1,216,004
	Administration charges		(4,077)		(43,259)		(15,931)		(5,729)
	Contingent sales charges		(3,669)		(9,056)		(24,380)		(490)
	Contract terminations		(548,824)		(1,630,543)		(6,488,601)		(107,735)
	Death benefit payments		(4,024)		(290,478)		(403,096)		—
	Flexible withdrawal option payments		(40,799)		(595,137)		(780,979)		(19,717)
	Transfers to other contracts		(654,039)		(1,248,458)		(6,112,221)		(190,829)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(495,732)		(3,231,272)		(9,991,365)		891,504
Total increase (decrease)			(1,567,118)		(3,782,616)		(13,817,224)		733,763
Net assets as of December 31, 2018			9,719,860		11,401,149		61,500,401		3,270,539
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		65,351		108,883		281,150		30,204
	Total realized gains (losses) on investments		1,078,935		725,212		9,762,855		311,375
	Change in net unrealized appreciation (depreciation)
	of investments		1,254,271		327,916		7,368,808		675,230
	Net gains (losses) on investments		2,398,557		1,162,011		17,412,813		1,016,809
Net increase (decrease) in net assets resulting from operations			2,398,557		1,162,011		17,412,813		1,016,809
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,546,017		758,056		3,443,526		2,453,536
	Administration charges		(7,149)		(29,568)		(13,915)		(9,021)
	Contingent sales charges		(8,301)		(6,695)		(25,495)		(2,890)
	Contract terminations		(1,374,136)		(1,619,389)		(7,827,368)		(144,613)
	Death benefit payments		—		(147,537)		(1,387,136)		(22,707)
	Flexible withdrawal option payments		(37,223)		(526,867)		(757,886)		(19,470)
	Transfers to other contracts		(376,287)		(357,785)		(4,864,877)		(436,200)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(257,079)		(1,929,785)		(11,433,151)		1,818,635
Total increase (decrease)			2,141,478		(767,774)		5,979,662		2,835,444
Net assets as of December 31, 2019		$	11,861,338	$	10,633,375	$	67,480,063	$	6,105,983
See accompanying notes.

A-76

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		Rydex Basic Materials Division		Rydex Commodities Strategy Division		Rydex NASDAQ 100 Division		SAM Balanced Portfolio Class 1 Division
Net assets as of January 1, 2018		$	439,801	$	271,312	$	1,358,604	$	536,023,423
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(3,555)		9,888		(20,910)		8,073,899
	Total realized gains (losses) on investments		12,146		10,247		101,008		30,909,114
	Change in net unrealized appreciation (depreciation)
	of investments		(113,786)		(108,846)		(186,449)		(68,888,685)
	Net gains (losses) on investments		(105,195)		(88,711)		(106,351)		(29,905,672)
Net increase (decrease) in net assets resulting from operations			(105,195)		(88,711)		(106,351)		(29,905,672)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		161,093		309,624		954,303		19,032,622
	Administration charges		(434)		(253)		(5,637)		(3,360,590)
	Contingent sales charges		(79)		(117)		(1,331)		(314,852)
	Contract terminations		(2,670)		(23,285)		(103,095)		(51,825,702)
	Death benefit payments		—		(1,198)		(2,542)		(4,527,129)
	Flexible withdrawal option payments		(365)		(2,362)		(3,704)		(13,334,965)
	Transfers to other contracts		(1,708)		(41,430)		(265,364)		(19,578,439)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			155,837		240,979		572,630		(73,909,055)
Total increase (decrease)			50,642		152,268		466,279		(103,814,727)
Net assets as of December 31, 2018			490,443		423,580		1,824,883		432,208,696
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(6,684)		1,456		(22,331)		4,501,847
	Total realized gains (losses) on investments		27,388		(5,564)		83,014		18,513,667
	Change in net unrealized appreciation (depreciation)
	of investments		78,927		64,075		655,958		50,648,846
	Net gains (losses) on investments		99,631		59,967		716,641		73,664,360
Net increase (decrease) in net assets resulting from operations			99,631		59,967		716,641		73,664,360
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		29,495		64,522		753,174		7,644,958
	Administration charges		(563)		(482)		(6,359)		(2,314,355)
	Contingent sales charges		(75)		(482)		(810)		(271,690)
	Contract terminations		(9,756)		(27,286)		(72,927)		(52,764,065)
	Death benefit payments		—		—		(2,444)		(5,599,660)
	Flexible withdrawal option payments		(1,343)		(2,028)		(8,066)		(12,303,301)
	Transfers to other contracts		(1,457)		(18,746)		(109,095)		(12,287,637)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			16,301		15,498		553,473		(77,895,750)
Total increase (decrease)			115,932		75,465		1,270,114		(4,231,390)
Net assets as of December 31, 2019		$	606,375	$	499,045	$	3,094,997	$	427,977,306
See accompanying notes.

A-77

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		SAM Balanced Portfolio Class 2 Division		SAM Conservative Balanced Portfolio Class 1 Division		SAM Conservative Balanced Portfolio Class 2 Division		SAM Conservative Growth Portfolio Class 1 Division
Net assets as of January 1, 2018		$	9,147,273	$	128,349,159	$	5,203,713	$	106,720,296
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		253,956		2,170,636		125,568		1,245,341
	Total realized gains (losses) on investments		673,443		4,847,423		206,670		8,374,957
	Change in net unrealized appreciation (depreciation)
	of investments		(1,809,015)		(12,400,624)		(621,650)		(17,095,687)
	Net gains (losses) on investments		(881,616)		(5,382,565)		(289,412)		(7,475,389)
Net increase (decrease) in net assets resulting from operations			(881,616)		(5,382,565)		(289,412)		(7,475,389)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		5,858,093		5,631,596		2,147,675		10,713,365
	Administration charges		(28,936)		(452,025)		(18,351)		(10,820)
	Contingent sales charges		(6,747)		(89,809)		(1,853)		(117,897)
	Contract terminations		(636,550)		(15,336,465)		(300,532)		(18,239,752)
	Death benefit payments		—		(999,078)		(13,800)		(604,715)
	Flexible withdrawal option payments		(226,862)		(3,390,344)		(50,317)		(988,809)
	Transfers to other contracts		(127,888)		(5,362,607)		(673,142)		(4,209,807)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			4,831,110		(19,998,732)		1,089,680		(13,458,435)
Total increase (decrease)			3,949,494		(25,381,297)		800,268		(20,933,824)
Net assets as of December 31, 2018			13,096,767		102,967,862		6,003,981		85,786,472
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		270,670		1,417,793		139,591		339,518
	Total realized gains (losses) on investments		691,456		1,648,177		107,235		3,463,132
	Change in net unrealized appreciation (depreciation)
	of investments		1,939,678		10,844,136		704,735		14,010,768
	Net gains (losses) on investments		2,901,804		13,910,106		951,561		17,813,418
Net increase (decrease) in net assets resulting from operations			2,901,804		13,910,106		951,561		17,813,418
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		8,382,193		3,039,184		2,936,995		4,038,413
	Administration charges		(39,690)		(319,597)		(17,741)		(9,452)
	Contingent sales charges		(7,386)		(50,414)		(2,800)		(64,498)
	Contract terminations		(397,706)		(10,153,043)		(259,596)		(13,152,309)
	Death benefit payments		(25,142)		(1,891,987)		(66,341)		(284,300)
	Flexible withdrawal option payments		(274,825)		(3,014,496)		(78,341)		(896,275)
	Transfers to other contracts		(814,816)		(2,365,937)		(539,825)		(3,869,176)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			6,822,628		(14,756,290)		1,972,351		(14,237,597)
Total increase (decrease)			9,724,432		(846,184)		2,923,912		3,575,821
Net assets as of December 31, 2019		$	22,821,199	$	102,121,678	$	8,927,893	$	89,362,293
See accompanying notes.

A-78

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		SAM Conservative Growth Portfolio Class 2 Division		SAM Flexible Income Portfolio Class 1 Division		SAM Flexible Income Portfolio Class 2 Division		SAM Strategic Growth Portfolio Class 1 Division
Net assets as of January 1, 2018		$	8,478,538	$	159,705,243	$	8,096,190	$	66,383,041
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		163,025		3,635,657		323,777		499,548
	Total realized gains (losses) on investments		522,418		3,301,827		244,072		4,338,854
	Change in net unrealized appreciation (depreciation)
	of investments		(1,585,855)		(11,650,339)		(952,659)		(10,566,310)
	Net gains (losses) on investments		(900,412)		(4,712,855)		(384,810)		(5,727,908)
Net increase (decrease) in net assets resulting from operations			(900,412)		(4,712,855)		(384,810)		(5,727,908)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		3,712,822		7,441,334		7,557,241		3,485,914
	Administration charges		(39,418)		(268,839)		(30,683)		(9,084)
	Contingent sales charges		(1,423)		(89,915)		(3,465)		(57,502)
	Contract terminations		(368,326)		(15,598,980)		(332,473)		(8,698,002)
	Death benefit payments		—		(1,753,851)		(4,891)		(238,987)
	Flexible withdrawal option payments		(70,330)		(3,888,060)		(194,691)		(460,126)
	Transfers to other contracts		(62,565)		(13,987,368)		(2,190,264)		(3,728,822)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			3,170,760		(28,145,679)		4,800,774		(9,706,609)
Total increase (decrease)			2,270,348		(32,858,534)		4,415,964		(15,434,517)
Net assets as of December 31, 2018			10,748,886		126,846,709		12,512,154		50,948,524
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		87,003		2,524,636		368,732		7,080
	Total realized gains (losses) on investments		395,507		1,694,363		401,769		2,314,292
	Change in net unrealized appreciation (depreciation)
	of investments		1,980,212		9,732,166		796,351		9,809,596
	Net gains (losses) on investments		2,462,722		13,951,165		1,566,852		12,130,968
Net increase (decrease) in net assets resulting from operations			2,462,722		13,951,165		1,566,852		12,130,968
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		6,293,800		10,702,178		4,999,435		2,059,750
	Administration charges		(39,039)		(183,686)		(37,255)		(7,806)
	Contingent sales charges		(16,459)		(64,191)		(7,084)		(42,933)
	Contract terminations		(1,212,642)		(13,396,036)		(483,842)		(8,696,828)
	Death benefit payments		(2,298,694)		(5,832,018)		(25,237)		(24,109)
	Flexible withdrawal option payments		(82,063)		(3,713,775)		(234,151)		(441,551)
	Transfers to other contracts		(185,015)		(6,521,199)		(1,457,975)		(2,026,228)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			2,459,888		(19,008,727)		2,753,891		(9,179,705)
Total increase (decrease)			4,922,610		(5,057,562)		4,320,743		2,951,263
Net assets as of December 31, 2019		$	15,671,496	$	121,789,147	$	16,832,897	$	53,899,787
See accompanying notes.

A-79

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		SAM Strategic Growth Portfolio Class 2 Division		Short-Term Income Class 1 Division		SmallCap Class 1 Division		SmallCap Class 2 Division
Net assets as of January 1, 2018		$	5,077,915	$	87,366,110	$	112,085,132	$	1,013,662
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		70,988		573,009		(1,140,623)		(12,575)
	Total realized gains (losses) on investments		366,931		(603,743)		9,745,347		110,830
	Change in net unrealized appreciation (depreciation)
	of investments		(1,091,961)		(333,574)		(19,692,302)		(307,735)
	Net gains (losses) on investments		(654,042)		(364,308)		(11,087,578)		(209,480)
Net increase (decrease) in net assets resulting from operations			(654,042)		(364,308)		(11,087,578)		(209,480)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,916,670		11,769,693		5,763,689		757,553
	Administration charges		(17,772)		(351,958)		(112,344)		(2,935)
	Contingent sales charges		(1,161)		(46,233)		(31,560)		(147)
	Contract terminations		(205,718)		(8,040,179)		(10,348,221)		(38,676)
	Death benefit payments		(3,917)		(930,051)		(734,469)		—
	Flexible withdrawal option payments		(31,603)		(3,064,803)		(1,517,808)		(18,943)
	Transfers to other contracts		(61,763)		(12,569,782)		(7,136,275)		(208,655)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			1,594,736		(13,233,313)		(14,116,988)		488,197
Total increase (decrease)			940,694		(13,597,621)		(25,204,566)		278,717
Net assets as of December 31, 2018			6,018,609		73,768,489		86,880,566		1,292,379
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		32,443		905,453		(965,794)		(16,025)
	Total realized gains (losses) on investments		464,664		(209,413)		15,837,119		272,713
	Change in net unrealized appreciation (depreciation)
	of investments		1,256,273		1,637,793		6,475,160		125,227
	Net gains (losses) on investments		1,753,380		2,333,833		21,346,485		381,915
Net increase (decrease) in net assets resulting from operations			1,753,380		2,333,833		21,346,485		381,915
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		2,783,131		14,314,980		3,630,644		991,722
	Administration charges		(20,995)		(240,542)		(73,134)		(4,519)
	Contingent sales charges		(4,826)		(60,793)		(31,927)		(2,011)
	Contract terminations		(267,362)		(11,457,382)		(11,455,738)		(82,110)
	Death benefit payments		(2,241)		(558,871)		(674,467)		(7,419)
	Flexible withdrawal option payments		(42,900)		(2,799,102)		(1,383,747)		(23,634)
	Transfers to other contracts		(399,188)		(4,873,624)		(3,917,395)		(94,248)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			2,045,619		(5,675,334)		(13,905,764)		777,781
Total increase (decrease)			3,798,999		(3,341,501)		7,440,721		1,159,696
Net assets as of December 31, 2019		$	9,817,608	$	70,426,988	$	94,321,287	$	2,452,075
See accompanying notes.

A-80

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		T. Rowe Price Blue Chip Growth Portfolio II Division		T. Rowe Price Health Sciences Portfolio II Division		Templeton Global Bond VIP Class 4 Division		Templeton Growth VIP Class 2 Division
Net assets as of January 1, 2018		$	21,628,237	$	28,306,947	$	2,026,380	$	890,640
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(341,594)		(413,796)		(28,724)		9,783
	Total realized gains (losses) on investments		3,202,377		3,225,538		2,201		76,460
	Change in net unrealized appreciation (depreciation)
	of investments		(2,838,061)		(2,779,049)		35,555		(222,995)
	Net gains (losses) on investments		22,722		32,693		9,032		(136,752)
Net increase (decrease) in net assets resulting from operations			22,722		32,693		9,032		(136,752)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		4,530,216		3,041,982		2,819,252		12,661
	Administration charges		(21,089)		(12,909)		(2,746)		—
	Contingent sales charges		(13,108)		(19,150)		(517)		(1)
	Contract terminations		(1,889,447)		(2,760,346)		(124,566)		(15,060)
	Death benefit payments		(153,394)		(128,291)		—		(4,504)
	Flexible withdrawal option payments		(228,100)		(279,887)		(23,698)		(9,138)
	Transfers to other contracts		(2,929,579)		(3,101,664)		(197,783)		(1,222)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(704,501)		(3,260,265)		2,469,942		(17,264)
Total increase (decrease)			(681,779)		(3,227,572)		2,478,974		(154,016)
Net assets as of December 31, 2018			20,946,458		25,079,375		4,505,354		736,624
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		(347,436)		(378,192)		282,028		13,833
	Total realized gains (losses) on investments		3,049,407		2,685,899		(4,983)		149,839
	Change in net unrealized appreciation (depreciation)
	of investments		2,988,815		3,884,057		(251,832)		(69,823)
	Net gains (losses) on investments		5,690,786		6,191,764		25,213		93,849
Net increase (decrease) in net assets resulting from operations			5,690,786		6,191,764		25,213		93,849
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		4,514,062		2,092,269		941,071		17,446
	Administration charges		(16,406)		(8,989)		(3,464)		—
	Contingent sales charges		(13,362)		(22,312)		(864)		(2)
	Contract terminations		(2,385,049)		(4,017,051)		(100,936)		(159,066)
	Death benefit payments		(346,647)		(473,952)		—		(4,129)
	Flexible withdrawal option payments		(274,090)		(232,787)		(21,807)		(6,975)
	Transfers to other contracts		(2,987,000)		(2,447,036)		(208,699)		(16,426)
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			(1,508,492)		(5,109,858)		605,301		(169,152)
Total increase (decrease)			4,182,294		1,081,906		630,514		(75,303)
Net assets as of December 31, 2019		$	25,128,752	$	26,161,281	$	5,135,868	$	661,321
See accompanying notes.

A-81

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		The Merger Fund Division		TOPS Aggressive Growth ETF Portfolio Investor Class Division (1)		TOPS Balanced ETF Portfolio Investor Class Division (1)		TOPS Conservative ETF Portfolio Investor Class Division (1)
Net assets as of January 1, 2018		$	5,999	$	—	$	—	$	—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		238		54		245		—
	Total realized gains (losses) on investments		2,026		311		471		—
	Change in net unrealized appreciation (depreciation)
	of investments		3,223		(2,425)		(2,641)		—
	Net gains (losses) on investments		5,487		(2,060)		(1,925)		—
Net increase (decrease) in net assets resulting from operations			5,487		(2,060)		(1,925)		—
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		168,653		21,774		28,260		—
	Administration charges		(305)		(13)		—		—
	Contingent sales charges		—		—		—		—
	Contract terminations		—		—		—		—
	Death benefit payments		—		—		—		—
	Flexible withdrawal option payments		(160)		—		—		—
	Transfers to other contracts		(135)		—		(78)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			168,053		21,761		28,182		—
Total increase (decrease)			173,540		19,701		26,257		—
Net assets as of December 31, 2018			179,539		19,701		26,257		—
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		974		5,385		4,954		(1,229)
	Total realized gains (losses) on investments		16,138		18,236		8,298		726
	Change in net unrealized appreciation (depreciation)
	of investments		(4,844)		32,198		20,850		8,040
	Net gains (losses) on investments		12,268		55,819		34,102		7,537
Net increase (decrease) in net assets resulting from operations			12,268		55,819		34,102		7,537
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		162,285		550,310		956,931		300,734
	Administration charges		(795)		(1,271)		(13)		(131)
	Contingent sales charges		(408)		—		—		(73)
	Contract terminations		(17,843)		—		—		(13,148)
	Death benefit payments		—		—		—		—
	Flexible withdrawal option payments		(827)		—		—		—
	Transfers to other contracts		(30,313)		(380)		(431)		—
	Annuity payments		—		—		—		—
Increase (decrease) in net assets from policy related transactions			112,099		548,659		956,487		287,382
Total increase (decrease)			124,367		604,478		990,589		294,919
Net assets as of December 31, 2019		$	303,906	$	624,179	$	1,016,846	$	294,919
(1) Commenced operations June 11, 2018.
See accompanying notes.

A-82

Principal Life Insurance Company
Separate Account B
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018
		TOPS Growth ETF Portfolio Investor Class Division (1)		TOPS Moderate Growth ETF Portfolio Investor Class Division (1)		VanEck Global Hard Assets Class S Division
Net assets as of January 1, 2018		$	—	$	—	$	5,837,935
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		31		(15)		(74,948)
	Total realized gains (losses) on investments		(246)		—		(314,443)
	Change in net unrealized appreciation (depreciation)
	of investments		(121)		(263)		(1,227,029)
	Net gains (losses) on investments		(336)		(278)		(1,616,420)
Net increase (decrease) in net assets resulting from operations			(336)		(278)		(1,616,420)
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		42,867		11,418		822,000
	Administration charges		(4)		—		(865)
	Contingent sales charges		—		—		(2,973)
	Contract terminations		—		—		(485,054)
	Death benefit payments		—		—		(76,148)
	Flexible withdrawal option payments		—		—		(37,430)
	Transfers to other contracts		(8,728)		—		(545,173)
	Annuity payments		—		—		—
Increase (decrease) in net assets from policy related transactions			34,135		11,418		(325,643)
Total increase (decrease)			33,799		11,140		(1,942,063)
Net assets as of December 31, 2018			33,799		11,140		3,895,872
Increase (decrease) in net assets
Operations:
	Net investment income (loss)		5,969		286		(56,342)
	Total realized gains (losses) on investments		30,868		2,087		(362,083)
	Change in net unrealized appreciation (depreciation)
	of investments		56,486		5,737		802,914
	Net gains (losses) on investments		93,323		8,110		384,489
Net increase (decrease) in net assets resulting from operations			93,323		8,110		384,489
Policy related transactions:
	Purchase payments, less sales charges, per payment fees and
	applicable premium taxes		1,421,161		363,477		668,767
	Administration charges		(707)		(83)		(721)
	Contingent sales charges		—		(4,209)		(2,958)
	Contract terminations		—		(141,168)		(500,183)
	Death benefit payments		—		—		(15,067)
	Flexible withdrawal option payments		(1,528)		—		(30,310)
	Transfers to other contracts		(502,535)		(4)		(442,881)
	Annuity payments		—		—		—
Increase (decrease) in net assets from policy related transactions			916,391		218,013		(323,353)
Total increase (decrease)			1,009,714		226,123		61,136
Net assets as of December 31, 2019		$	1,043,513	$	237,263	$	3,957,008
(1) Commenced operations June 11, 2018.
See accompanying notes.

A-83

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

1. Nature of Operations and Significant Accounting Policies

Description of Business

Principal Life Insurance Company Separate Account B (“Separate Account B”) is a segregated investment account of Principal Life Insurance Company (“Principal Life”) and is registered under the Investment Company Act of 1940 as a unit investment trust, with no stated limitations on the number of authorized units. As directed by eligible contractholders, each division of Separate Account B invests exclusively in shares representing interests in a corresponding investment option. As of December 31, 2019, contractholder investment options included the following diversified open–end management investment companies:

Principal Variable Contracts Funds, Inc. – Class 1: (1)

Core Plus Bond Account

Diversified Balanced Account (7)

Diversified International Account

Equity Income Account

Government & High Quality Bond Account

International Emerging Markets Account

LargeCap Growth Account I

LargeCap S&P 500 Index Account

MidCap Account

Principal Capital Appreciation Account

Principal LifeTime 2010 Account

Principal LifeTime 2020 Account

Principal LifeTime 2030 Account

Principal LifeTime 2040 Account

Principal LifeTime 2050 Account

Principal LifeTime Strategic Income Account

Real Estate Securities Account

Short-Term Income Account

SmallCap Account

Strategic Asset Management (“SAM”) Portfolios:

Balanced Portfolio

Conservative Balanced Portfolio

Conservative Growth Portfolio

Flexible Income Portfolio

Strategic Growth Portfolio

Principal Variable Contracts Funds, Inc. – Class 2: (1)

Diversified Balanced Account

Diversified Balanced Managed Volatility Account

Diversified Balanced Volatility Control Account (6)

Diversified Growth Account

Diversified Growth Managed Volatility Account

Diversified Growth Volatility Control Account (6)

Diversified Income Account

Equity Income Account

LargeCap S&P 500 Index Account (3)

Principal Capital Appreciation Account

Real Estate Securities Account

SmallCap Account (2)

A-84

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

SAM Portfolios:

Balanced Portfolio

Conservative Balanced Portfolio

Conservative Growth Portfolio

Flexible Income Portfolio

Strategic Growth Portfolio

AllianceBernstein Variable Product Series Fund, Inc.:

Small Cap Growth Portfolio – Class A

Small/Mid Cap Value Portfolio – Class A

Alps/Red Rocks Listed Private Equity – Class III (3)

American Century Investments®:

VP Capital Appreciation Fund – Class I

VP Income & Growth Fund – Class I

VP Inflation Protection Fund – Class II

VP Mid Cap Value Fund – Class II

VP Ultra® Fund – Class I

VP Ultra® Fund – Class II

VP Value Fund – Class II

American Funds Insurance Series:

Asset Allocation Fund – Class 2 (5)

Asset Allocation Fund – Class 4 (3)

Blue Chip Income and Growth Fund – Class 2 (5)

Blue Chip Income and Growth Fund – Class 4

Global Small Capitalization Fund – Class 2

Global Small Capitalization Fund – Class 4

High-Income Bond Fund – Class 2

Managed Risk Asset Allocation Fund – Class P2

Managed Risk Growth Fund – Class P2

Managed Risk International Fund – Class P2

New World Fund – Class 2

New World Fund – Class 4

BlackRock Variable Insurance Funds:

60/40 Target Allocation ETF V.I. Fund – Class III (3) (10)

Advantage U.S. Total Market V.I. Fund – Class III (3)

Global Allocation V.I. Fund – Class III (3)

BNY Mellon IP:

MidCap Stock Portfolio – Service Shares (3) (11)

Technology Growth Portfolio – Service Shares (12)

Calvert VP Portfolio:

EAFE International Index – Class F

Investment Grade Bond – Class F (8)

Russell 2000 Small Cap Index – Class F

S&P MidCap 400 Index – Class F

ClearBridge Variable Small Cap Growth Portfolio – Class II (3)

Columbia Variable Portfolio:

Limited Duration Credit – Class 2 (3)

Small Cap Value – Class 2 (3)

Delaware VIP® Trust Series:

Limited Term Diversified Income – Service Class (3)

Small Cap Value – Service Class

DWS Variable Series II:

Alternative Asset Allocation VIP – Class B

Equity 500 Index VIP – Class B2

Small Mid Cap Value VIP – Class B

A-85

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

EQ Advisors Trust:^(SM) 

1290 VT Convertible Securities Portfolio – Class IB (9)

1290 VT GAMCO Small Company Value Portfolio – Class IB (9)

1290 VT Micro Cap Portfolio – Class IB (9)

1290 VT SmartBeta Equity Portfolio – Class IB (9)

1290 VT Socially Responsible Portfolio – Class IB (9)

Fidelity® Variable Insurance Products:

Contrafund® Portfolio – Service Class

Contrafund® Portfolio – Service Class 2

Equity-Income Portfolio – Service Class 2

Freedom 2020 – Service Class 2 (9)

Freedom 2030 – Service Class 2 (9)

Freedom 2040 – Service Class 2 (9)

Freedom 2050 – Service Class 2 (9)

Government Money Market Portfolio – Initial Class (4)

Government Money Market Portfolio – Service Class 2 (4)

Growth Portfolio – Service Class

Growth Portfolio – Service Class 2

Mid Cap Portfolio – Service Class

Mid Cap Portfolio – Service Class 2

Overseas Portfolio – Service Class 2

Franklin Templeton Variable Insurance Products Trust:

Franklin Global Real Estate VIP Fund – Class 2

Franklin Income VIP – Class 4 (8)

Franklin Rising Dividends VIP Fund – Class 4

Franklin Small Cap Value VIP Fund – Class 2

Franklin U.S. Government Securities VIP Fund – Class 2 (9)

Templeton Global Bond VIP Fund – Class 4

Templeton Growth VIP Fund – Class 2

Goldman Sachs Variable Insurance Trust:

Mid Cap Value Fund – Institutional Shares

Mid Cap Value Fund – Service Shares

Multi-Strategy Alternatives Portfolio – Service Shares (3)

Small Cap Equity Insights Fund – Institutional Shares

Small Cap Equity Insights Fund – Service Shares

Guggenheim Investments Variable Insurance Funds:

Floating Rate Strategies – Series F

Global Managed Futures Strategy Fund

Long Short Equity Fund

Multi-Hedge Strategies Fund

Invesco V.I. Fund:

American Franchise Fund – Series I Shares

Balanced-Risk Allocation Fund – Series II Shares

Core Equity Fund – Series I Shares

Health Care Fund – Series I Shares

Health Care Fund – Series II Shares

International Growth Fund – Series I Shares

International Growth Fund – Series II Shares

Mid Cap Growth Fund – Series I Shares

Oppenheimer Main Street Small Cap Fund – Series II Shares (13)

Small Cap Equity Fund – Series I Shares

Technology Fund – Series I Shares

Value Opportunities Fund – Series I Shares

A-86

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Janus Henderson Series:

Enterprise Portfolio – Service Shares

Flexible Bond Portfolio – Service Shares

Global Technology Portfolio – Service Shares (9)

MFS®:

International Intrinsic Value Portfolio – Service Class (14)

New Discovery Portfolio – Service Class

Utilities Series – Service Class

Value Series – Service Class

Neuberger Berman Advisors Management Trust:

Mid Cap Growth Portfolio – Class S (3)

Sustainable Equity Portfolio – Class I

Sustainable Equity Portfolio – Class S (8)

PIMCO Variable Insurance Trust:

All Asset Portfolio – Administrative Class

All Asset Portfolio – Advisor Class (3)

Commodity Real Return Strategy Portfolio – Class M (3)

High Yield Portfolio – Administrative Class

Low Duration Portfolio – Advisor Class (3)

Total Return Portfolio – Administrative Class

Rydex V.I. Fund:

Basic Materials Fund (3)

Commodities Strategy Fund

NASDAQ 100 Fund

T. Rowe Price Equity Series, Inc.:

Blue Chip Growth Portfolio – II

Health Sciences Portfolio – II

The Merger Fund VL (3)

TOPS Managed Risk Series:

Aggressive Growth ETF Portfolio Investor Class (8)

Balanced ETF Portfolio Investor Class (8)

Conservative ETF Portfolio Investor Class (8)

Growth ETF Portfolio Investor Class (8)

Moderate Growth ETF Portfolio Investor Class (8)

VanEck VIP Global Hard Assets Fund – Class S Shares

(1)    Organized by Principal Life.

(2) Commenced operations April 17, 2015.

(3) Commenced operations May 18, 2015.

(4) Commenced operations February 8, 2016.

(5) Commenced operations May 23, 2016.

(6) Commenced operations April 6, 2017.

(7) Commenced operations May 26, 2017.

(8) Commenced operations June 11, 2018.

(9) Commenced operations June 7, 2019.

(10) Represented the operations of BlackRock iShares Dynamic Allocation Class III Division until June 6, 2019.

(11) Represented the operations of Dreyfus IP MidCap Stock Service Shares Division until June 2, 2019.

(12) Represented the operations of Dreyfus IP Technology Growth Service Shares Division until June 2, 2019.

(13) Represented the operations of Oppenheimer Main Street Small Cap Service Shares Division until May 24, 2019.

(14) Represented the operations of MFS International Value Service Class Division until June 6, 2019.

Commenced operations date is the date the division became available to contractholders.

A-87

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

During 2019, the following divisions were liquidated and subsequently reinvested:

Date	Liquidation Division	Reinvested Division	Transferred Assets
June 15, 2019	Core Plus Bond Class 2	Core Plus Bond Class 1	$	1,463,847
June 15, 2019	Diversified International Class 2	Diversified Balanced Class 1		1,211,840
June 15, 2019	Government & High Quality Bond Class 2	Government & High Quality Bond Class 1		1,901,868
June 8, 2019	Income Class 1	Core Plus Bond Class 1		5,498,449
June 8, 2019	Income Class 2	Core Plus Bond Class 1		1,546,746
June 15, 2019	International Emerging Markets Class 2	International Emerging Markets Class 1		1,850,923
June 8, 2019	LargeCap Growth Class 1	LargeCap Growth I Class 1		5,162,773
June 8, 2019	LargeCap Growth Class 2	LargeCap Growth I Class 1		37,055,405
June 15, 2019	LargeCap Growth I Class 2	LargeCap Growth I Class 1		1,093,008
June 8, 2019	Multi-Asset Income Class 1	SAM Flexible Income Portfolio Class 1		217,339
June 8, 2019	Multi-Asset Income Class 2	SAM Flexible Income Portfolio Class 2		94,698
April 30, 2019	Neuberger Berman AMT Large Cap Value    I Class	Neuberger Berman AMT Sustainable Equity    Class I		3,860,049
June 15, 2019	Principal LifeTime 2020 Class 2	Principal LifeTime 2020 Class 1		1,446,974
June 15, 2019	Principal LifeTime 2030 Class 2	Principal LifeTime 2030 Class 1		2,144,829
June 15, 2019	Principal LifeTime 2040 Class 2	Principal LifeTime 2040 Class 1		895,545
June 15, 2019	Principal LifeTime 2050 Class 2	Principal LifeTime 2050 Class 1		1,138,306
June 15, 2019	Short-Term Income Class 2	Short-Term Income Class 1		3,619,597

The assets of Separate Account B are owned by Principal Life. The assets of Separate Account B support the following variable annuity contracts of Principal Life and may not be used to satisfy the liabilities arising from any other business of Principal Life:

• Bankers Flexible Annuity;

• Pension Builder Plus;

• Pension Builder Plus-Rollover IRA;

• Personal Variable;

• Premier Variable;

• Principal^® Freedom Variable Annuity;

• Principal^® Freedom Variable Annuity 2;

• Principal^® Investment Plus Variable Annuity;

• Principal^® Investment Plus Variable Annuity with Premium Payment Credit Rider;

• Principal^® Lifetime Income Solutions;

• Principal^® Lifetime Income Solutions II;

• Principal^® Pivot Series Variable Annuity;

• Principal^® Pivot Series Variable Annuity with Liquidity Max Rider;

• Principal^® Pivot Series Variable Annuity v2;

• Principal^® Pivot Series Variable Annuity v3;

• Principal^® Variable Annuity and

• Principal^® Variable Annuity with Purchase Payment Credit Rider.

Principal Life no longer accepts contributions for Bankers Flexible Annuity contracts, Pension Builder Plus contracts and Pension Builder Plus-Rollover IRA contracts. Contractholders are given the option of withdrawing their funds or transferring to another contract at any time. Contributions to the Personal Variable contracts are no longer accepted from new customers, only from existing customers.

A-88

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements and accompanying notes of Separate Account B in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported and disclosed. These estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the financial statements and accompanying notes.

Investments

Investments are stated at the closing net asset value (“NAV”) per share on December 31, 2019. Net realized capital gains and losses on sales of investments are determined on the basis of specific identification under the first-in, first-out method. Investment transactions are accounted for on a trade date basis. Dividends and realized gains (losses) on investments are recognized on an accrual basis as of the ex-dividend date and are automatically reinvested in shares of the funds on the payable date.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels.The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety considering factors specific to the asset or liability.

• Level 1 – Fair values are based on unadjusted quoted prices in active markets for identical assets or liabilities.

• Level 2 – Fair values are based on inputs other than quoted prices within Level 1 that are observable for the asset or

liability, either directly or indirectly.

• Level 3 – Fair values are based on at least one significant unobservable input for the asset or liability.

All investments of the open-end management investment companies listed above represent investments in mutual funds for which a daily NAV is calculated and published. Therefore, all investments are reflected in Level 1 of the fair value hierarchy.

2. Expenses and Related Party Transactions

Principal Life is compensated for the following expenses:

Bankers Flexible Annuity contracts – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.48% of the asset value of each contract. An annual administration charge of $7 for each participant’s account is deducted as compensation for administrative expenses. This charge is collected by redeeming units of the separate account.

Pension Builder Plus and Pension Builder Plus-Rollover IRA contracts – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.50% (1.00% for a Rollover IRA) of the asset value of each contract. A contingent sales charge of up to 7.00% may be deducted from withdrawals made during the first ten years of a contract, except for withdrawals related to death or permanent disability. An annual administration charge will be deducted ranging from a minimum of $25 to a maximum of $275 depending upon the number of participants under the retirement plan and their participant investment account values.

A-89

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Personal Variable contracts – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.64% of the asset value of each contract. The contract provides for recordkeeping and other services and allows the contractholders, in their sole discretion, a customized plan-level service package and charges. An annual administration charge of $34 (increases to $37 if the benefit plan reports are distributed directly to the homes of plan participants) for each participant’s account plus 0.35% of the annual average balance of investment account values that correlate to a plan participant will be deducted on a quarterly basis.

Premier Variable contracts – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.42% of the asset value of each contract. The contract provides for recordkeeping and other services and allows the contractholders, in their sole discretion, a customized plan-level service package and charges. The amount varies by Plan document and contract account balance. The annual charge ranges from $2,250 to $25,316 plus $10 per participant. The amount varies by total plan participants. No contingent sales charges were provided for in these contracts.

Principal^® Freedom Variable Annuity – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.85% of the asset value of each contract. Principal Life reserves the right to increase this charge but guarantees it will not exceed 1.25% per year. A surrender charge up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for withdrawals related to death, annuitization, permanent disability, confinement in a health facility or terminal illness. Principal Life reserves the right to charge an additional administrative fee of up to 0.15% of the asset value of each division. This fee is currently being waived.

Principal^® Freedom Variable Annuity 2 – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.95% of the asset value of each contract. Principal Life reserves the right to increase this charge but guarantees it will not exceed 1.25% per year. A surrender charge up to 3.00% may be deducted from the withdrawals made during the first three years of a contract, except for death, annuitization, permanent disability, confinement in a health facility or terminal illness. Principal Life reserves the right to charge an additional administrative fee of up to 0.15% of the asset value of each division. This fee is currently being waived.

Principal^® Investment Plus Variable Annuity – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.25% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. An annual administration charge of the lesser of 2.00% of the accumulated value or $30 is deducted at the end of the contract year. Principal Life reserves the right to charge an additional administrative fee of up to 0.15% of the asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value. The product also contains an optional premium payment credit rider, which charges an annual rate of 0.60%. For electing participants, the rider is deducted from the daily unit value. For contracts with the premium payment credit rider, the maximum surrender charge is 8.00% from withdrawals made during the first eight years.

Principal^® Lifetime Income Solutions – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.25% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. Principal Life reserves the right to charge an additional administration fee of up to 0.15% of the average daily net asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value.

A-90

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Principal^® Lifetime Income Solutions II – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.25% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. Principal Life reserves the right to charge an additional administration fee of up to 0.15% of the average daily net asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value.

Principal^® Pivot Series Variable Annuity – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.00% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. An annual administration charge of the lesser of 2.00% of the accumulated value or $30 is deducted at the end of the contract year. Principal Life reserves the right to charge an additional administrative fee of up to 0.30% of the asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value. The product also contains an optional liquidity max rider, which charges an annual rate of 0.25%. For electing participants, the rider is deducted from the daily unit value.

Principal^® Pivot Series Variable Annuity v2 – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.85% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. An annual administration charge of the lesser of 2.00% of the accumulated value or $30 is deducted at the end of the contract year. Principal Life reserves the right to charge an additional administrative fee of up to 0.30% of the asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value.

Principal^® Pivot Series Variable Annuity v3 – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 0.60% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. An annual administration charge of the lesser of 2.00% of the accumulated value or $30 is deducted at the end of the contract year. Principal Life reserves the right to charge an additional administrative fee of up to 0.30% of the asset value of each division. Currently, Principal Life is charging an annual rate of 0.15% of the asset value of each contract. This charge is deducted from the daily unit value.

Principal^® Variable Annuity – Mortality and expense risks assumed by Principal Life are compensated for by a daily charge resulting in a reduction of the unit value equivalent to an annual rate of 1.25% of the asset value of each contract. A surrender charge of up to 6.00% may be deducted from the withdrawals made during the first six years of a contract, except for death, annuitization, permanent disability, confinement in a health care facility or terminal illness. Principal Life reserves the right to charge an additional administrative fee of up to 0.15% of the asset value of each division. Currently, Principal Life is charging an annual rate of 0.05% of the asset value of each contract. This charge is deducted from the daily unit value. The product also contains an optional purchase payment credit rider, which charges an annual rate of 0.60%. For electing participants, the rider is deducted from the daily unit value. For contracts with the purchase payment credit rider, the maximum surrender charge is 8.00% from withdrawals made during the first eight years.

A-91

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

During the year ended December 31, 2019, investment advisory and management fees were paid indirectly to Principal Global Investors, LLC (“Manager”) (wholly owned by Principal Financial Services, Inc.) in its capacity as advisor to Principal Variable Contracts Funds, Inc. A portion of the management fee is paid by the Manager to the sub-advisor of each of the divisions, some of which are affiliates of the Manager. The annual rate paid by the SAM Portfolios is based upon the aggregate average daily net assets (“aggregate net assets”) of the SAM Portfolios. The investment advisory and management fee schedule for the SAM Portfolios is 0.25% of aggregate net assets up to the first $1 billion and 0.20% of aggregate net assets over $1 billion. The Principal LifeTime Accounts do not pay investment advisory and management fees.

The annual rates used in this calculation for each of the other divisions are shown in the following tables:

	Net Assets of Accounts
	(in millions)
	First $100		Next $100		Next $100		Next $100		Thereafter
Core Plus Bond Account		0.50%		0.45%		0.40%		0.35%		0.30%
Equity Income Account		0.60		0.55		0.50		0.45		0.40
LargeCap Growth Account I		0.80		0.75		0.70		0.65		0.60
MidCap Account		0.65		0.60		0.55		0.50		0.45
Real Estate Securities Account		0.90		0.85		0.80		0.75		0.70
SmallCap Account		0.85		0.80		0.75		0.70		0.65
	Net Assets of Accounts
	(in millions)
	First $250		Next $250		Next $250		Next $250		Thereafter
Diversified International Account		0.85%		0.80%		0.75%		0.70%		0.65%
International Emerging Markets Account		1.25		1.20		1.15		1.10		1.05

	Net Assets of Accounts
	(in millions)
	First $200	Next $300	Over $500
Short-Term Income Account	0.50%	0.45%	0.40%
	Net Assets of Accounts
	(in millions)
	First $500	Over $500
Principal Capital Appreciation Account	0.625%	0.500%
	Net Assets of Accounts
	(in millions)
	First $2,000	Over $2,000
Government & High Quality Bond Account	0.50%	0.45%

A-92

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	All Net Assets
Diversified Balanced Account	0.05%
Diversified Balanced Managed Volatility Account	0.05
Diversified Balanced Volatility Control Account	0.12
Diversified Growth Account	0.05
Diversified Growth Managed Volatility Account	0.05
Diversified Growth Volatility Control Account	0.12
Diversified Income Account	0.05
LargeCap S&P 500 Index Account	0.25

The Manager has contractually agreed to limit the expenses (including acquired fund fees and expenses, but excluding interest expense, expenses related to fund investments, and other extraordinary expenses) for certain classes of shares of certain of the divisions. The reductions and reimbursements are in amounts that maintain total operating expenses at or below certain limits. The limits are expressed as a percentage of average daily net assets attributable to each class of shares on an annualized basis during the reporting period. The expenses borne by the Manager are subject to reimbursement by the divisions through the fiscal year end, provided no reimbursement will be made if it would result in the divisions exceeding the total operating expense limits. Any amounts outstanding at the end of the year are shown as an expense reimbursement from Manager or expense reimbursement to Manager on the statements of assets and liabilities. The operating expense limits, were as follows:

	From January 1, 2019 through April 30, 2019
	Class 1	Class 2	Expiration
SAM Balanced Portfolio	0.86%	1.11%	April 30, 2019
SAM Conservative Balanced Portfolio	0.84	1.09	April 30, 2019
SAM Conservative Growth Portfolio	0.99	1.24	April 30, 2019
SAM Strategic Growth Portfolio	0.99	1.24	April 30, 2019

The Manager has contractually agreed to limit certain of the Separate Account’s management and investment advisory fees. The expense limit will reduce the Separate Account’s management and investment advisory fees by the following amounts:

	All Classes	Expiration
LargeCap Growth Account I	0.016%	April 30, 2020
Real Estate Securities Account	0.020	April 30, 2020

A-93

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

The Manager has contractually agreed to limit the expenses (excluding interest expense, expense related to fund investments, acquired fund fees and expenses and other extraordinary expenses) for certain classes of shares of certain of the divisions. The reductions and reimbursements are in amounts that maintain total operating expenses at or below certain limits. The limits are expressed as a percentage of average daily net assets attributable to each class of shares on an annualized basis during the reporting period. The operating expense limits were as follows:

	From January 1, 2019 through December 31, 2019
	Class 1	Class 2	Expiration
Diversified Balanced Managed Volatility Account	N/A	0.31%	April 30, 2020
Diversified Balanced Volatility Control Account	N/A	0.39	April 30, 2020
Diversified Growth Managed Volatility Account	N/A	0.31	April 30, 2020
Diversified Growth Volatility Control Account	N/A	0.39	April 30, 2020
International Emerging Markets Account	1.20%	N/A	April 30, 2020
LargeCap Growth Account I	0.69^	N/A	April 30, 2021
^Period from June 10, 2019 to December 31, 2019. Prior to June 10, 2019, there was no contractual limit.

The Manager has contractually agreed to reduce the Short-Term Income Account’s expenses by 0.01% through the period ended April 30, 2020.

In addition, the Manager has voluntarily agreed to limit the expenses (excluding interest the Separate Accounts incur in connection with investments they make and acquired fund fees and expenses) attributable to Class 2 shares of certain of the Separate Accounts. The reductions and reimbursements are in amounts that maintain total operating expenses at or below certain limits. The limits are expressed as a percentage of average daily net assets on an annualized basis during the reporting period. The expense limit may be terminated at any time. The operating expense limits were as follows:

	Expense Limit
	Class 2
Diversified Balanced Account	0.31%
Diversified Growth Account	0.31
Diversified Income Account	0.31

3. Federal Income Taxes

The operations of Separate Account B are a part of the operations of Principal Life. Under current practice, no federal income taxes are allocated by Principal Life to the operations of Separate Account B.

4. Purchases and Sales of Investments

The aggregate cost of purchases and proceeds from sales of investments were as follows for the year ended December 31, 2019:

Division	Purchases		Sales
AllianceBernstein Small Cap Growth Class A	$	1,193,457	$	2,029,826
AllianceBernstein Small/Mid Cap Value Class A	$	947,238	$	494,748
Alps/Red Rocks Listed Private Equity Class III	$	214,726	$	23,713
American Century VP Capital Appreciation Class I	$	521,766	$	953,367

A-94

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
American Century VP Income & Growth Class I	$	1,399,378	$	1,628,172
American Century VP Inflation Protection Class II	$	4,946,963	$	8,771,195
American Century VP Mid Cap Value Class II	$	1,739,535	$	1,415,486
American Century VP Ultra Class I	$	719,789	$	1,148,978
American Century VP Ultra Class II	$	4,545,791	$	9,117,278
American Century VP Value Class II	$	1,655,027	$	2,506,456
American Funds Insurance Series Asset Allocation Fund Class 2	$	507,976	$	566,330
American Funds Insurance Series Asset Allocation Fund Class 4	$	4,771,991	$	928,471
American Funds Insurance Series Blue Chip Income and Growth Class 2	$	877,139	$	623,263
American Funds Insurance Series Blue Chip Income and Growth Class 4	$	2,950,206	$	318,362
American Funds Insurance Series Global Small Capitalization Fund Class 2	$	239,487	$	291,684
American Funds Insurance Series Global Small Capitalization Fund Class 4	$	626,234	$	101,574
American Funds Insurance Series High-Income Bond Class 2	$	327,543	$	356,421
American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2	$	950,912	$	50,749
American Funds Insurance Series Managed Risk Growth Fund Class P2	$	440,353	$	81,058
American Funds Insurance Series Managed Risk International Fund Class P2	$	50,464	$	3,646
American Funds Insurance Series New World Fund Class 2	$	565,911	$	428,923
American Funds Insurance Series New World Fund Class 4	$	888,775	$	105,199
BlackRock 60/40 Target Allocation Class III	$	438,583	$	284,131
BlackRock Advantage U.S. Total Market Class III	$	230,907	$	138,023
BlackRock Global Allocation Class III	$	532,951	$	204,075
BNY Mellon IP MidCap Stock Service Shares	$	125,907	$	57,338
BNY Mellon IP Technology Growth Service Shares	$	1,891,128	$	2,694,883
Calvert EAFE International Index Class F	$	651,199	$	37,104
Calvert Investment Grade Bond Portfolio Class F	$	803,283	$	21,773
Calvert Russell 2000 Small Cap Index Class F	$	1,172,079	$	175,916
Calvert S&P MidCap 400 Index Class F	$	1,940,737	$	301,454

A-95

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
ClearBridge Small Cap Growth Class II	$	1,128,531	$	374,024
Columbia Limited Duration Credit Class 2	$	260,439	$	60,195
Columbia Small Cap Value Class 2	$	492,110	$	107,704
Core Plus Bond Class 1	$	21,700,699	$	22,294,268
Delaware Limited Term Diversified Income Service Class	$	153,136	$	60,037
Delaware Small Cap Value Service Class	$	570,740	$	534,072
Diversified Balanced Class 1	$	2,427,012	$	2,927,364
Diversified Balanced Class 2	$	105,595,435	$	192,514,518
Diversified Balanced Managed Volatility Class 2	$	18,776,860	$	26,802,857
Diversified Balanced Volatility Control Class 2	$	75,949,496	$	9,720,028
Diversified Growth Class 2	$	345,506,091	$	568,195,682
Diversified Growth Managed Volatility Class 2	$	24,368,388	$	48,510,366
Diversified Growth Volatility Control Class 2	$	335,201,980	$	33,648,245
Diversified Income Class 2	$	76,103,732	$	64,324,073
Diversified International Class 1	$	13,049,763	$	19,335,832
DWS Alternative Asset Allocation Class B	$	5,028	$	2,179
DWS Equity 500 Index Class B2	$	508,097	$	133,887
DWS Small Mid Cap Value Class B	$	434,907	$	187,537
EQ Convertible Securities Class IB	$	—	$	—
EQ GAMCO Small Company Value Class IB	$	54,513	$	161
EQ Micro Cap Class IB Division	$	10,943	$	51
EQ SmartBeta Equity Class IB	$	61,217	$	636
EQ Socially Responsible Class IB	$	16,574	$	826
Equity Income Class 1	$	16,214,344	$	50,291,741
Equity Income Class 2	$	2,566,935	$	330,780
Fidelity VIP Contrafund Service Class	$	4,621,278	$	6,999,108
Fidelity VIP Contrafund Service Class 2	$	10,071,650	$	10,644,114

A-96

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
Fidelity VIP Equity-Income Service Class 2	$	3,482,856	$	4,657,167
Fidelity VIP Freedom 2020 Service Class 2	$	136,713	$	518
Fidelity VIP Freedom 2030 Service Class 2	$	334,582	$	43,925
Fidelity VIP Freedom 2040 Service Class 2	$	694,037	$	1,020
Fidelity VIP Freedom 2050 Service Class 2	$	173,082	$	255
Fidelity VIP Government Money Market Initial Class	$	10,852,951	$	20,509,733
Fidelity VIP Government Money Market Service Class 2	$	15,598,607	$	14,387,697
Fidelity VIP Growth Service Class	$	1,228,524	$	2,844,431
Fidelity VIP Growth Service Class 2	$	1,452,082	$	2,074,261
Fidelity VIP Mid Cap Service Class	$	10,163	$	847
Fidelity VIP Mid Cap Service Class 2	$	7,171,657	$	5,129,933
Fidelity VIP Overseas Service Class 2	$	2,518,334	$	5,867,580
Franklin Global Real Estate VIP Class 2	$	551,715	$	89,434
Franklin Income VIP Class 4	$	1,152,038	$	16,191
Franklin Rising Dividends VIP Class 4	$	1,396,980	$	203,896
Franklin Small Cap Value VIP Class 2	$	1,044,286	$	852,462
Franklin U.S. Government Fund Class 2	$	323,162	$	863
Goldman Sachs VIT Mid Cap Value Institutional Shares	$	893,127	$	2,397,923
Goldman Sachs VIT Mid Cap Value Service Shares	$	642,549	$	41,167
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares	$	20,091	$	1,620
Goldman Sachs VIT Small Cap Equity Insights Institutional Shares	$	436,908	$	1,421,336
Goldman Sachs VIT Small Cap Equity Insights Service Shares	$	236,236	$	28,815
Government & High Quality Bond Class 1	$	11,095,132	$	16,635,798
Guggenheim Floating Rate Strategies Series F	$	907,184	$	1,203,645
Guggenheim Investments Global Managed Futures Strategy	$	26,510	$	44,166
Guggenheim Investments Long Short Equity	$	22,472	$	87,115
Guggenheim Investments Multi-Hedge Strategies	$	40,057	$	33,262

A-97

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
International Emerging Markets Class 1	$	6,850,747	$	10,108,791
Invesco American Franchise Series I	$	676,046	$	912,422
Invesco Balanced-Risk Allocation Series II	$	155,166	$	26,558
Invesco Core Equity Series I	$	1,790,266	$	2,521,067
Invesco Health Care Series I	$	407,188	$	1,565,631
Invesco Health Care Series II	$	1,260,570	$	212,212
Invesco International Growth Series I	$	911,438	$	1,773,878
Invesco International Growth Series II	$	739,497	$	89,477
Invesco Mid Cap Growth Series I	$	180,542	$	324,329
Invesco Oppenheimer V.I. Main Street Small Cap Series II	$	78,624	$	92,553
Invesco Small Cap Equity Series I	$	1,289,701	$	1,019,227
Invesco Technology Series I	$	398,763	$	1,121,396
Invesco Value Opportunities Series I	$	1,024,205	$	776,154
Janus Henderson Enterprise Service Shares	$	1,078,029	$	1,889,115
Janus Henderson Flexible Bond Service Shares	$	1,394,176	$	260,745
Janus Henderson Global Technology Service Shares	$	325,613	$	2,632
LargeCap Growth I Class 1	$	67,924,461	$	29,853,951
LargeCap S&P 500 Index Class 1	$	9,799,307	$	18,714,658
LargeCap S&P 500 Index Class 2	$	7,797,870	$	1,056,470
MFS International Intrinsic Value Service Class	$	1,923,772	$	1,329,118
MFS New Discovery Service Class	$	2,999,247	$	1,051,630
MFS Utilities Service Class	$	3,504,633	$	3,074,996
MFS Value Service Class	$	1,000,410	$	1,361,637
MidCap Class 1	$	55,779,687	$	69,343,940
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	$	1,240,346	$	740,490
Neuberger Berman AMT Sustainable Equity Class I	$	4,355,826	$	1,600,265
Neuberger Berman AMT Sustainable Equity Class S	$	15,600	$	1,930

A-98

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
PIMCO All Asset Administrative Class	$	236,911	$	783,372
PIMCO All Asset Advisor Class	$	5,449	$	2,259
PIMCO Commodity Real Return Strategy M Class	$	9,236	$	4,368
PIMCO High Yield Administrative Class	$	4,155,783	$	3,718,290
PIMCO Low Duration Advisor Class	$	1,259,296	$	773,701
PIMCO Total Return Administrative Class	$	5,187,267	$	4,974,148
Principal Capital Appreciation Class 1	$	12,291,180	$	23,506,204
Principal Capital Appreciation Class 2	$	3,004,764	$	351,760
Principal LifeTime 2010 Class 1	$	1,639,828	$	3,253,785
Principal LifeTime 2020 Class 1	$	8,641,957	$	17,557,220
Principal LifeTime 2030 Class 1	$	7,838,344	$	12,115,999
Principal LifeTime 2040 Class 1	$	2,760,925	$	2,308,782
Principal LifeTime 2050 Class 1	$	2,464,806	$	1,956,975
Principal LifeTime Strategic Income Class 1	$	1,459,255	$	2,844,915
Real Estate Securities Class 1	$	9,199,932	$	15,824,839
Real Estate Securities Class 2	$	2,842,672	$	681,684
Rydex Basic Materials	$	55,078	$	19,879
Rydex Commodities Strategy	$	72,130	$	55,176
Rydex NASDAQ 100	$	811,386	$	225,082
SAM Balanced Portfolio Class 1	$	33,466,051	$	91,651,012
SAM Balanced Portfolio Class 2	$	9,537,280	$	1,736,610
SAM Conservative Balanced Portfolio Class 1	$	7,947,232	$	19,270,322
SAM Conservative Balanced Portfolio Class 2	$	3,310,160	$	1,038,233
SAM Conservative Growth Portfolio Class 1	$	9,633,172	$	19,539,348
SAM Conservative Growth Portfolio Class 2	$	7,093,781	$	3,954,249
SAM Flexible Income Portfolio Class 1	$	18,499,657	$	31,472,906
SAM Flexible Income Portfolio Class 2	$	5,953,775	$	2,386,810

A-99

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

Division	Purchases		Sales
SAM Strategic Growth Portfolio Class 1	$	5,521,869	$	12,025,084
SAM Strategic Growth Portfolio Class 2	$	3,362,836	$	821,803
Short-Term Income Class 1	$	16,202,498	$	20,972,379
SmallCap Class 1	$	18,478,574	$	18,808,285
SmallCap Class 2	$	1,276,154	$	231,634
T. Rowe Price Blue Chip Growth Portfolio II	$	5,170,319	$	6,369,989
T. Rowe Price Health Sciences Portfolio II	$	3,245,009	$	7,580,318
Templeton Global Bond VIP Class 4	$	1,282,905	$	395,576
Templeton Growth VIP Class 2	$	174,059	$	192,666
The Merger Fund	$	178,937	$	52,283
TOPS Aggressive Growth ETF Portfolio Investor Class	$	576,635	$	4,128
TOPS Balanced ETF Portfolio Investor Class	$	972,368	$	2,594
TOPS Conservative ETF Portfolio Investor Class	$	300,789	$	14,617
TOPS Growth ETF Portfolio Investor Class	$	1,457,798	$	511,272
TOPS Moderate Growth ETF Portfolio Investor Class	$	365,109	$	145,891
VanEck Global Hard Assets Class S	$	668,767	$	1,048,462

A-100

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

5. Changes in Units Outstanding

Transactions in units were as follows for each of the years ended December 31:

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
AllianceBernstein Small Cap Growth Class A	13,845	46,565	(32,720)	27,727	33,601	(5,874)
AllianceBernstein Small/Mid Cap Value Class A	28,151	28,919	(768)	38,534	54,586	(16,052)
Alps/Red Rocks Listed Private Equity Class III	19,277	1,711	17,566	15,965	1,634	14,331
American Century VP Capital Appreciation Class I	10,606	59,031	(48,425)	9,115	36,957	(27,842)
American Century VP Income & Growth Class I	16,218	65,666	(49,448)	7,302	63,857	(56,555)
American Century VP Inflation Protection Class II	318,547	623,884	(305,337)	354,281	854,691	(500,410)
American Century VP Mid Cap Value Class II	27,319	52,492	(25,173)	43,799	84,707	(40,908)
American Century VP Ultra Class I	12,321	42,433	(30,112)	14,618	27,962	(13,344)
American Century VP Ultra Class II	48,215	285,743	(237,528)	121,904	389,622	(267,718)
American Century VP Value Class II	39,808	103,608	(63,800)	49,790	104,982	(55,192)
American Funds Insurance Series Asset Allocation    Fund Class 2	25,221	40,421	(15,201)	99,215	34,950	64,265
American Funds Insurance Series Asset Allocation    Fund Class 4	409,258	75,417	333,841	196,917	5,781	191,136
American Funds Insurance Series Blue Chip Income    and Growth Class 2	43,586	44,977	(1,392)	75,243	62,571	12,672
American Funds Insurance Series Blue Chip Income    and Growth Class 4	237,613	25,307	212,306	214,908	41,342	173,566
American Funds Insurance Series Global Small    Capitalization Fund Class 2	12,335	23,262	(10,927)	48,592	22,228	26,364
American Funds Insurance Series Global Small    Capitalization Fund Class 4	53,683	8,362	45,321	63,800	23,377	40,423
American Funds Insurance Series High-Income Bond    Class 2	22,100	29,878	(7,778)	12,414	30,738	(18,324)
American Funds Insurance Series Managed Risk    Asset Allocation Fund Class P2	80,862	3,225	77,637	41,912	6,413	35,499
American Funds Insurance Series Managed Risk    Growth Fund Class P2	27,657	5,386	22,271	90,324	6,006	84,318

A-101

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
American Funds Insurance Series Managed Risk    International Fund Class P2	4,205	169	4,036	4,164	1,426	2,738
American Funds Insurance Series New World Fund    Class 2	42,137	35,160	6,977	69,274	83,542	(14,268)
American Funds Insurance Series New World Fund    Class 4	81,574	8,909	72,665	62,016	6,812	55,204
BlackRock 60/40 Target Allocation Class III	38,466	24,928	13,538	31,619	1,314	30,305
BlackRock Advantage U.S. Total Market Class III	8,948	11,043	(2,095)	67,249	1,522	65,727
BlackRock Global Allocation Class III	41,690	17,131	24,559	65,907	17,748	48,159
BNY Mellon IP MidCap Stock Service Shares	8,879	4,959	3,920	32,872	884	31,988
BNY Mellon IP Technology Growth Service Shares	19,105	67,060	(47,955)	50,212	94,945	(44,733)
Calvert EAFE International Index Class F	64,496	2,993	61,503	61,633	6,657	54,976
Calvert Investment Grade Bond Portfolio Class F	72,301	1,703	70,598	16,274	78	16,196
Calvert Russell 2000 Small Cap Index Class F	94,835	13,915	80,920	114,434	25,804	88,630
Calvert S&P MidCap 400 Index Class F	155,875	23,704	132,171	102,055	21,207	80,848
ClearBridge Small Cap Growth Class II	83,277	28,134	55,143	76,198	5,479	70,719
Columbia Limited Duration Credit Class 2	24,724	5,531	19,193	5,312	6,833	(1,521)
Columbia Small Cap Value Class 2	45,601	9,707	35,894	23,883	3,234	20,649
Core Plus Bond Class 1	1,061,606	965,007	96,599	539,428	1,495,185	(955,757)
Delaware Limited Term Diversified Income Service    Class	14,056	5,541	8,515	12,357	4,706	7,651
Delaware Small Cap Value Service Class	24,139	34,516	(10,377)	37,484	42,928	(5,444)
Diversified Balanced Class 1	80,379	237,846	(157,467)	73,569	382,976	(309,407)
Diversified Balanced Class 2	2,846,726	10,554,591	(7,707,865)	4,073,739	10,983,563	(6,909,824)
Diversified Balanced Managed Volatility Class 2	1,097,638	1,947,231	(849,593)	1,082,294	1,983,481	(901,187)
Diversified Balanced Volatility Control Class 2	6,707,995	752,999	5,954,996	3,547,673	380,896	3,166,777
Diversified Growth Class 2	8,812,926	27,845,821	(19,032,895)	12,603,978	24,837,993	(12,234,015)
Diversified Growth Managed Volatility Class 2	1,131,518	3,329,166	(2,197,648)	2,336,979	3,146,509	(809,530)

A-102

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
Diversified Growth Volatility Control Class 2	29,097,937	2,287,791	26,810,146	23,077,047	1,318,867	21,758,180
Diversified Income Class 2	5,386,850	4,535,995	850,855	4,880,487	5,938,035	(1,057,548)
Diversified International Class 1	373,209	697,146	(323,937)	332,062	846,623	(514,561)
DWS Alternative Asset Allocation Class B	352	168	184	966	831	135
DWS Equity 500 Index Class B2	34,030	8,618	25,412	64,322	17,668	46,654
DWS Small Mid Cap Value Class B	32,483	14,486	17,997	22,800	14,586	8,214
EQ Convertible Securities Class IB	—	—	—	—	—	—
EQ GAMCO Small Company Value Class IB	5,090	5	5,085	—	—	—
EQ Micro Cap Class IB	960	2	958	—	—	—
EQ SmartBeta Equity Class IB	5,785	38	5,747	—	—	—
EQ Socially Responsible Class IB	1,545	70	1,475	—	—	—
Equity Income Class 1	484,508	2,551,268	(2,066,760)	5,847,245	2,445,486	3,401,759
Equity Income Class 2	199,840	22,240	177,600	224,975	30,836	194,139
Fidelity VIP Contrafund Service Class	11,018	201,478	(190,460)	26,038	232,700	(206,662)
Fidelity VIP Contrafund Service Class 2	281,140	345,353	(64,213)	316,744	387,259	(70,515)
Fidelity VIP Equity-Income Service Class 2	51,344	192,009	(140,665)	49,384	215,536	(166,152)
Fidelity VIP Freedom 2020 Service Class 2	13,216	15	13,201	—	—	—
Fidelity VIP Freedom 2030 Service Class 2	31,550	4,239	27,311	—	—	—
Fidelity VIP Freedom 2040 Service Class 2	64,863	9	64,854	—	—	—
Fidelity VIP Freedom 2050 Service Class 2	16,019	6	16,013	—	—	—
Fidelity VIP Government Money Market Initial Class	2,252,047	3,101,091	(849,044)	3,772,185	2,410,438	1,361,747
Fidelity VIP Government Money Market Service    Class 2	1,541,530	1,429,186	112,344	1,551,368	1,093,890	457,478
Fidelity VIP Growth Service Class	12,845	111,558	(98,713)	37,928	123,971	(86,043)
Fidelity VIP Growth Service Class 2	22,427	59,419	(36,992)	28,077	66,183	(38,106)

A-103

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
Fidelity VIP Mid Cap Service Class	—	—	—	—	42,102	(42,102)
Fidelity VIP Mid Cap Service Class 2	314,981	193,070	121,911	277,856	145,348	132,508
Fidelity VIP Overseas Service Class 2	78,454	296,873	(218,419)	189,310	277,867	(88,557)
Franklin Global Real Estate VIP Class 2	45,311	6,707	38,604	22,078	8,326	13,752
Franklin Income VIP Class 4	107,500	1,040	106,460	9,212	8	9,204
Franklin Rising Dividends VIP Class 4	90,350	14,734	75,616	48,428	21,970	26,458
Franklin Small Cap Value VIP Class 2	14,954	34,489	(19,535)	12,826	40,346	(27,520)
Franklin U.S. Government Fund Class 2	31,811	53	31,758	—	—	—
Goldman Sachs VIT Mid Cap Value Institutional    Shares	13,807	79,794	(65,987)	12,642	65,974	(53,332)
Goldman Sachs VIT Mid Cap Value Service Shares	53,117	2,835	50,282	23,800	5,482	18,318
Goldman Sachs VIT Multi-Strategy Alternatives    Portfolio Service Shares	1,848	114	1,734	4,867	89	4,778
Goldman Sachs VIT Small Cap Equity Insights    Institutional Shares	12,160	55,515	(43,355)	23,594	44,388	(20,794)
Goldman Sachs VIT Small Cap Equity Insights    Service Shares	21,651	2,367	19,284	18,834	914	17,920
Government & High Quality Bond Class 1	942,270	1,389,153	(446,883)	688,459	2,143,548	(1,455,089)
Guggenheim Floating Rate Strategies Series F	72,418	110,098	(37,680)	235,390	74,547	160,843
Guggenheim Investments Global Managed Futures    Strategy	2,685	4,600	(1,915)	9,416	1,411	8,005
Guggenheim Investments Long Short Equity	2,244	8,749	(6,505)	10,725	1,857	8,868
Guggenheim Investments Multi-Hedge Strategies	2,714	2,737	(23)	13,159	9,654	3,505
International Emerging Markets Class 1	325,485	311,986	13,499	193,750	389,267	(195,517)
Invesco American Franchise Series I	4,232	39,590	(35,358)	6,403	30,078	(23,675)
Invesco Balanced-Risk Allocation Series II	15,046	2,015	13,031	6,827	187	6,640
Invesco Core Equity Series I	9,511	127,626	(118,115)	17,905	173,727	(155,822)
Invesco Health Care Series I	11,623	59,732	(48,109)	26,228	67,263	(41,035)

A-104

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
Invesco Health Care Series II	103,394	16,628	86,766	58,767	30,504	28,263
Invesco International Growth Series I	31,547	136,646	(105,100)	58,874	189,868	(130,994)
Invesco International Growth Series II	62,184	7,385	54,799	36,985	3,445	33,540
Invesco Mid Cap Growth Series I	1,568	15,989	(14,421)	10,583	15,944	(5,361)
Invesco Oppenheimer V.I. Main Street Small Cap    Series II	2,433	5,517	(3,084)	5,649	15,213	(9,564)
Invesco Small Cap Equity Series I	20,587	36,087	(15,500)	18,517	62,959	(44,442)
Invesco Technology Series I	10,309	73,182	(62,873)	33,902	80,684	(46,782)
Invesco Value Opportunities Series I	20,278	43,542	(23,264)	20,579	62,889	(42,310)
Janus Henderson Enterprise Service Shares	18,550	69,274	(50,724)	24,937	73,028	(48,091)
Janus Henderson Flexible Bond Service Shares	124,808	22,381	102,427	54,395	80,005	(25,610)
Janus Henderson Global Technology Service Shares	30,047	175	29,872	—	—	—
LargeCap Growth I Class 1	2,647,283	563,086	2,084,197	157,788	353,828	(196,040)
LargeCap S&P 500 Index Class 1	342,465	922,182	(579,717)	849,027	934,111	(85,084)
LargeCap S&P 500 Index Class 2	623,913	80,605	543,308	430,978	27,790	403,188
MFS International Intrinsic Value Service Class	140,876	102,545	38,331	174,797	191,861	(17,064)
MFS New Discovery Service Class	167,147	62,731	104,416	126,143	39,654	86,489
MFS Utilities Service Class	193,311	117,882	75,429	102,473	112,232	(9,759)
MFS Value Service Class	23,427	45,622	(22,195)	21,131	55,313	(34,182)
MidCap Class 1	118,165	571,198	(453,033)	153,342	662,883	(509,541)
Neuberger Berman AMT Mid Cap Growth Portfolio    Class S	82,298	52,937	29,361	61,572	53,913	7,659
Neuberger Berman AMT Sustainable Equity Class I	143,376	54,631	88,745	12,391	47,569	(35,178)
Neuberger Berman AMT Sustainable Equity Class S	1,437	199	1,238	1,057	887	170
PIMCO All Asset Administrative Class	10,173	47,312	(37,139)	22,339	68,731	(46,392)
PIMCO All Asset Advisor Class	231	97	134	1,662	657	1,005

A-105

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
PIMCO Commodity Real Return Strategy M Class	817	507	310	4,309	151	4,158
PIMCO High Yield Administrative Class	253,134	220,105	33,029	191,642	368,314	(176,672)
PIMCO Low Duration Advisor Class	121,551	77,323	44,228	120,614	55,072	65,542
PIMCO Total Return Administrative Class	388,149	357,443	30,706	255,816	541,916	(286,100)
Principal Capital Appreciation Class 1	108,630	1,123,455	(1,014,825)	244,002	1,174,693	(930,691)
Principal Capital Appreciation Class 2	222,630	26,922	195,708	141,881	23,117	118,764
Principal LifeTime 2010 Class 1	13,713	175,165	(161,452)	37,289	378,230	(340,941)
Principal LifeTime 2020 Class 1	223,220	830,746	(607,526)	150,861	976,643	(825,782)
Principal LifeTime 2030 Class 1	292,153	553,559	(261,406)	160,056	605,549	(445,493)
Principal LifeTime 2040 Class 1	129,564	100,258	29,306	23,920	66,369	(42,449)
Principal LifeTime 2050 Class 1	133,582	84,085	49,497	34,681	58,155	(23,474)
Principal LifeTime Strategic Income Class 1	48,541	173,995	(125,454)	38,804	254,996	(216,192)
Real Estate Securities Class 1	84,135	244,287	(160,152)	70,739	245,004	(174,265)
Real Estate Securities Class 2	196,874	50,839	146,035	118,003	28,457	89,546
Rydex Basic Materials	2,958	1,210	1,748	15,080	476	14,604
Rydex Commodities Strategy	8,968	6,863	2,105	32,299	9,919	22,380
Rydex NASDAQ 100	61,904	13,671	48,233	79,782	29,095	50,687
SAM Balanced Portfolio Class 1	509,119	5,064,445	(4,555,327)	1,586,219	6,221,863	(4,635,644)
SAM Balanced Portfolio Class 2	792,463	139,595	652,868	550,386	91,386	459,000
SAM Conservative Balanced Portfolio Class 1	189,212	1,109,284	(920,072)	363,421	1,653,935	(1,290,514)
SAM Conservative Balanced Portfolio Class 2	276,384	86,165	190,219	207,828	97,407	110,421
SAM Conservative Growth Portfolio Class 1	231,621	1,068,309	(836,688)	651,760	1,474,455	(822,695)
SAM Conservative Growth Portfolio Class 2	590,332	327,537	262,795	353,151	44,772	308,379
SAM Flexible Income Portfolio Class 1	671,979	1,892,646	(1,220,668)	490,080	2,356,674	(1,866,594)
SAM Flexible Income Portfolio Class 2	468,956	208,984	259,972	739,877	266,235	473,642

A-106

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

	2019			2018
			Net increase			Net increase
Division	Purchases	Redemptions	(decrease)	Purchases	Redemptions	(decrease)
SAM Strategic Growth Portfolio Class 1	120,016	653,275	(533,259)	204,128	801,230	(597,102)
SAM Strategic Growth Portfolio Class 2	263,801	63,719	200,082	174,763	26,720	148,043
Short-Term Income Class 1	1,259,346	1,685,971	(426,625)	1,010,594	2,149,598	(1,139,004)
SmallCap Class 1	158,432	678,861	(520,429)	294,167	800,961	(506,794)
SmallCap Class 2	96,694	20,065	76,629	69,957	24,281	45,676
T. Rowe Price Blue Chip Growth Portfolio II	254,469	167,817	86,652	132,082	153,472	(21,390)
T. Rowe Price Health Sciences Portfolio II	35,246	117,903	(82,657)	52,753	110,039	(57,286)
Templeton Global Bond VIP Class 4	95,000	34,210	60,790	291,506	36,514	254,992
Templeton Growth VIP Class 2	834	8,283	(7,449)	526	1,250	(724)
The Merger Fund	15,125	4,625	10,500	16,436	57	16,379
TOPS Aggressive Growth ETF Portfolio Investor    Class	56,472	161	56,311	2,279	2	2,277
TOPS Balanced ETF Portfolio Investor Class	92,165	45	92,120	2,827	9	2,818
TOPS Conservative ETF Portfolio Investor Class	29,303	1,328	27,975	—	—	—
TOPS Growth ETF Portfolio Investor Class	146,243	52,311	93,932	4,715	893	3,822
TOPS Moderate Growth ETF Portfolio Investor Class	35,161	14,346	20,815	1,216	—	1,216
VanEck Global Hard Assets Class S	85,122	123,843	(38,721)	86,085	113,585	(27,500)

A-107

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

6. Financial Highlights

Principal Life sells a number of variable annuity products, which have unique combinations of features and fees that are charged against the contractholder’s account balance. Differences in the fee structures result in a variety of unit values, expense ratios and total returns.

Separate Account B has presented the following disclosures for 2019, 2018, 2017, 2016 and 2015 in accordance with the AICPA Audit and Accounting Guide for Investment Companies. The following table was developed by determining which products issued by Principal Life have the lowest and highest total return. Only product designs within each division that had units outstanding during the respective periods were considered when determining the lowest and highest total return. The summary may not reflect the minimum and maximum contract charges offered by Principal Life as the contractholder may not have selected all available and applicable contact options as discussed in Note 2.

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
AllianceBernstein Small Cap Growth Class A:
	2019	100	$	45.81	to	$	41.78	$	4,549	—%		1.40% to 2.00%	34.50	%	to	33.70	%
	2018	132	$	34.06	to	$	31.25	$	4,471	—%		1.40% to 2.00%	(2.29)	%	to	(2.86)	%
	2017	138	$	34.86	to	$	32.17	$	4,775	—%		1.40% to 2.00%	32.30	%	to	31.47	%
	2016	156	$	26.35	to	$	24.47	$	4,082	—%		1.40% to 2.00%	4.98	%	to	4.35	%
	2015	175	$	25.10	to	$	23.45	$	4,350	—%		1.40% to 2.00%	(2.64)	%	to	(3.18)	%
AllianceBernstein Small/Mid Cap Value Class A:
	2019	315	$	15.68	to	$	14.97	$	4,879	0.58	%	1.30% to 2.00%	18.52	%	to	17.69	%
	2018	316	$	13.23	to	$	12.72	$	4,134	0.48	%	1.30% to 2.00%	(16.11)	%	to	(16.70)	%
	2017	332	$	15.77	to	$	15.27	$	5,184	0.45	%	1.30% to 2.00%	11.69	%	to	10.89	%
	2016	290	$	14.12	to	$	13.77	$	4,055	0.59	%	1.30% to 2.00%	23.43	%	to	22.62	%
	2015	243	$	11.44	to	$	11.23	$	2,766	0.82	%	1.30% to 2.00%	(6.69)	%	to	(7.34)	%
Alps/Red Rocks Listed Private Equity Class III:
	2019	42	$	11.96	to	$	13.99	$	527	—%		0.75% to 1.40%	38.75	%	to	37.83	%
	2018	24	$	8.62	to	$	10.15	$	225	8.17	%	0.75% to 1.40%	(12.75)	%	to	(13.76)	%
	2017	10	$	11.65	to	$	11.77	$	114	3.34	%	1.00% to 1.40%	16.50	%	to	23.25	%
	2016	3	$	9.59	to	$	9.55	$	30	0.83	%	1.15% to 1.40%	6.79	%	to	6.47	%
	2015 (5)	3	$	8.98	to	$	8.97	$	24	0.22	%	1.15% to 1.40%	(10.02)	%	to	(10.12)	%
American Century VP Capital Appreciation Class I:
	2019	100	$	16.58	to	$	16.02	$	1,666	—%		1.40% to 2.00%	33.71	%	to	32.84	%
	2018	149	$	12.40	to	$	12.06	$	1,846	—%		1.40% to 2.00%	(6.56)	%	to	(7.09)	%
	2017	177	$	13.27	to	$	12.98	$	2,339	—%		1.40% to 2.00%	20.09	%	to	19.41	%
	2016	214	$	11.05	to	$	10.87	$	2,357	—%		1.40% to 2.00%	1.84	%	to	1.21	%
	2015	230	$	10.85	to	$	10.74	$	2,496	—%		1.40% to 2.00%	0.46	%	to	(0.09)	%

A-108

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
American Century VP Income & Growth Class I:
	2019	394	$	16.58	to	$	21.86	$	9,811	2.06	%	0.85% to 1.90%	22.90	%	to	21.65	%
	2018	443	$	21.40	to	$	17.97	$	9,023	1.92	%	0.85% to 1.90%	(7.68)	%	to	(8.64)	%
	2017	500	$	23.18	to	$	19.67	$	11,044	2.34	%	0.85% to 1.90%	19.48	%	to	18.21	%
	2016	585	$	19.40	to	$	16.64	$	10,859	2.37	%	0.85% to 1.90%	12.53	%	to	11.38	%
	2015	699	$	17.24	to	$	14.94	$	11,548	2.10	%	0.85% to 1.90%	(6.41)	%	to	(7.43)	%
American Century VP Inflation Protection Class II:
	2019	2,414	$	10.62	to	$	12.45	$	32,719	2.29	%	0.75% to 2.00%	8.04	%	to	6.78	%
	2018	2,719	$	9.83	to	$	11.66	$	34,370	2.83	%	0.75% to 2.00%	(1.50)	%	to	(4.82)	%
	2017	3,220	$	10.13	to	$	12.25	$	42,539	2.56	%	1.00% to 2.00%	1.40	%	to	1.66	%
	2016	3,502	$	9.89	to	$	12.05	$	45,285	1.86	%	1.15% to 2.00%	3.24	%	to	2.29	%
	2015	4,091	$	9.58	to	$	11.78	$	51,380	2.04	%	1.15% to 2.00%	(3.62)	%	to	(4.38)	%
American Century VP Mid Cap Value Class II:
	2019	341	$	27.13	to	$	25.44	$	9,130	1.90	%	1.30% to 2.00%	27.37	%	to	26.44	%
	2018	366	$	21.30	to	$	20.12	$	7,714	1.27	%	1.30% to 2.00%	(14.11)	%	to	(14.71)	%
	2017	407	$	24.80	to	$	23.59	$	9,988	1.39	%	1.30% to 2.00%	10.03	%	to	9.26	%
	2016	427	$	22.54	to	$	21.59	$	9,556	1.54	%	1.30% to 2.00%	21.12	%	to	20.28	%
	2015	349	$	18.61	to	$	17.95	$	6,444	1.48	%	1.30% to 2.00%	(2.82)	%	to	(3.49)	%
American Century VP Ultra Class I:
	2019	127	$	29.27	to	$	26.17	$	3,723	—%		1.30% to 1.90%	32.86	%	to	32.04	%
	2018	157	$	22.03	to	$	19.82	$	3,467	0.25	%	1.30% to 1.90%	(0.54)	%	to	(1.15)	%
	2017	171	$	22.15	to	$	20.05	$	3,782	0.36	%	1.30% to 1.90%	30.52	%	to	29.77	%
	2016	181	$	16.97	to	$	15.45	$	3,072	0.36	%	1.30% to 1.90%	3.10	%	to	2.45	%
	2015	220	$	16.46	to	$	15.08	$	3,618	0.45	%	1.30% to 1.90%	4.91	%	to	4.29	%
American Century VP Ultra Class II:
	2019	780	$	33.99	to	$	31.00	$	26,467	—%		1.40% to 2.00%	32.57	%	to	31.80	%
	2018	1,018	$	25.64	to	$	23.52	$	26,046	0.12	%	1.40% to 2.00%	(0.77)	%	to	(1.38)	%
	2017	1,286	$	25.84	to	$	23.85	$	33,153	0.25	%	1.40% to 2.00%	30.18	%	to	29.41	%
	2016	1,620	$	19.85	to	$	18.43	$	32,114	0.20	%	1.40% to 2.00%	2.90	%	to	2.28	%
	2015	1,882	$	19.29	to	$	18.02	$	36,158	0.32	%	1.40% to 2.00%	4.55	%	to	3.92	%

A-109

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
American Century VP Value Class II:
	2019	544	$	11.54	to	$	25.86	$	14,004	1.95	%	0.75% to 1.90%	25.98	%	to	24.57	%
	2018	608	$	9.16	to	$	20.76	$	12,705	1.51	%	0.75% to 1.90%	(8.22)	%	to	(11.02)	%
	2017	663	$	10.63	to	$	23.33	$	16,007	1.50	%	1.00% to 1.90%	5.88	%	to	6.53	%
	2016	707	$	11.45	to	$	21.90	$	16,312	1.57	%	1.15% to 1.90%	18.90	%	to	18.00	%
	2015	787	$	9.63	to	$	18.56	$	15,478	1.99	%	1.15% to 1.90%	(5.12)	%	to	(5.79)	%
American Funds Insurance Series Asset Allocation Fund Class 2:
	2019	199	$	13.77	to	$	13.42	$	2,711	1.88	%	1.30% to 2.00%	19.64	%	to	18.76	%
	2018	214	$	11.51	to	$	11.30	$	2,447	2.06	%	1.30% to 2.00%	(5.81)	%	to	(6.46)	%
	2017	150	$	12.22	to	$	12.08	$	1,827	1.75	%	1.30% to 2.00%	14.74	%	to	13.85	%
	2016 (7)	83	$	10.65	to	$	10.61	$	878	4.92	%	1.30% to 2.00%	6.50	%	to	6.10	%
American Funds Insurance Series Asset Allocation Fund Class 4:
	2019	687	$	11.45	to	$	13.34	$	8,180	2.04	%	0.75% to 1.40%	20.02	%	to	19.21	%
	2018	353	$	9.54	to	$	11.19	$	3,674	1.81	%	0.75% to 1.40%	(4.70)	%	to	(6.20)	%
	2017	162	$	10.93	to	$	11.93	$	1,852	1.91	%	1.00% to 1.40%	9.19	%	to	14.38	%
	2016	57	$	10.48	to	$	10.43	$	598	1.31	%	1.15% to 1.40%	7.93	%	to	7.64	%
	2015 (5)	83	$	9.71	to	$	9.69	$	806	7.44	%	1.15% to 1.40%	(2.90)	%	to	(3.10)	%
American Funds Insurance Series Blue Chip Income and Growth Class 2:
	2019	246	$	13.96	to	$	13.61	$	3,399	2.03	%	1.30% to 2.00%	19.83	%	to	18.97	%
	2018	247	$	11.65	to	$	11.44	$	2,860	1.99	%	1.30% to 2.00%	(9.83)	%	to	(10.49)	%
	2017	234	$	12.92	to	$	12.78	$	3,017	2.04	%	1.30% to 2.00%	15.46	%	to	14.72	%
	2016 (7)	152	$	11.19	to	$	11.14	$	1,696	5.19	%	1.30% to 2.00%	12.01	%	to	11.51	%
American Funds Insurance Series Blue Chip Income and Growth Class 4:
	2019	554	$	11.23	to	$	14.06	$	6,584	2.23	%	0.75% to 1.40%	20.11	%	to	19.35	%
	2018	342	$	9.35	to	$	11.78	$	3,493	2.36	%	0.75% to 1.40%	(6.97)	%	to	(10.21)	%
	2017	169	$	11.15	to	$	13.12	$	2,076	2.33	%	1.00% to 1.40%	11.39	%	to	15.09	%
	2016	93	$	11.46	to	$	11.40	$	1,061	1.84	%	1.15% to 1.40%	17.06	%	to	16.92	%
	2015	92	$	9.79	to	$	9.75	$	900	2.51	%	1.15% to 1.40%	(4.30)	%	to	(4.60)	%
American Funds Insurance Series Global Small Capitalization Fund Class 2:
	2019	121	$	14.54	to	$	12.15	$	1,573	0.16	%	1.30% to 2.00%	29.82	%	to	28.84	%
	2018	132	$	11.20	to	$	9.43	$	1,321	0.08	%	1.30% to 2.00%	(11.74)	%	to	(12.28)	%
	2017	105	$	12.69	to	$	10.75	$	1,211	0.42	%	1.30% to 2.00%	24.29	%	to	23.42	%
	2016	106	$	10.21	to	$	8.71	$	976	0.27	%	1.30% to 2.00%	0.79	%	to	—	%
	2015	91	$	10.13	to	$	8.71	$	844	—%		1.30% to 2.00%	(0.98)	%	to	(13.42)	%

A-110

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
American Funds Insurance Series Global Small Capitalization Fund Class 4:
	2019	117	$	11.39	to	$	13.76	$	1,434	0.01	%	0.75% to 1.40%	30.32	%	to	29.44	%
	2018	72	$	8.74	to	$	10.63	$	701	0.02	%	0.75% to 1.40%	(12.95)	%	to	(12.08)	%
	2017	32	$	11.67	to	$	12.09	$	374	0.35	%	1.00% to 1.40%	16.35	%	to	23.87	%
	2016	15	$	9.81	to	$	9.76	$	147	0.05	%	1.15% to 1.40%	0.62	%	to	0.51	%
	2015	14	$	9.75	to	$	9.71	$	133	—%		1.15% to 1.40%	(1.12)	%	to	(1.42)	%
American Funds Insurance Series High-Income Bond Class 2:
	2019	106	$	11.64	to	$	11.25	$	1,237	6.05	%	1.30% to 1.90%	11.07	%	to	10.40	%
	2018	114	$	10.48	to	$	10.19	$	1,195	5.82	%	1.30% to 1.90%	(3.59)	%	to	(4.23)	%
	2017	132	$	10.87	to	$	10.64	$	1,439	6.53	%	1.30% to 1.90%	5.53	%	to	4.93	%
	2016	128	$	10.30	to	$	10.14	$	1,320	9.72	%	1.30% to 1.90%	16.12	%	to	15.49	%
	2015	41	$	8.87	to	$	8.78	$	364	6.87	%	1.30% to 1.90%	(8.46)	%	to	(9.02)	%
American Funds Insurance Series Managed Risk Asset Allocation Fund Class P2:
	2019	184	$	11.29	to	$	12.62	$	2,153	2.10	%	0.75% to 1.40%	17.12	%	to	16.31	%
	2018	107	$	9.64	to	$	10.85	$	1,092	1.42	%	0.75% to 1.40%	(3.70)	%	to	(6.22)	%
	2017	71	$	10.86	to	$	11.57	$	794	0.64	%	1.00% to 1.40%	8.38	%	to	13.21	%
	2016	27	$	10.28	to	$	10.22	$	276	1.31	%	1.15% to 1.40%	6.09	%	to	5.80	%
	2015	6	$	9.69	to	$	9.66	$	62	1.57	%	1.15% to 1.40%	(2.22)	%	to	(2.42)	%
American Funds Insurance Series Managed Risk Growth Fund Class P2:
	2019	163	$	11.78	to	$	14.38	$	2,093	0.86	%	0.75% to 1.40%	20.82	%	to	20.03	%
	2018	140	$	9.75	to	$	11.98	$	1,520	0.44	%	0.75% to 1.40%	(2.79)	%	to	(1.72)	%
	2017	56	$	11.53	to	$	12.19	$	658	0.29	%	1.00% to 1.40%	14.96	%	to	24.26	%
	2016	17	$	9.87	to	$	9.81	$	165	0.19	%	1.15% to 1.40%	1.33	%	to	1.03	%
	2015	15	$	9.74	to	$	9.71	$	148	—%		1.15% to 1.40%	(0.41)	%	to	(0.72)	%
American Funds Insurance Series Managed Risk International Fund Class P2:
	2019	17	$	10.33	to	$	10.79	$	201	1.65	%	0.75% to 1.40%	16.72	%	to	16.02	%
	2018	13	$	8.85	to	$	9.30	$	135	1.67	%	0.75% to 1.40%	(11.32)	%	to	(11.76)	%
	2017	11	$	11.78	to	$	10.54	$	120	0.44	%	1.00% to 1.40%	17.80	%	to	26.84	%
	2016	5	$	8.36	to	$	8.31	$	41	0.92	%	1.15% to 1.40%	(4.13)	%	to	(4.37)	%
	2015	4	$	8.72	to	$	8.69	$	38	0.02	%	1.15% to 1.40%	(7.53)	%	to	(7.85)	%

A-111

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
American Funds Insurance Series New World Fund Class 2:
	2019	141	$	12.48	to	$	12.42	$	1,787	0.98	%	1.30% to 2.00%	27.48	%	to	26.61	%
	2018	134	$	9.79	to	$	9.81	$	1,332	0.77	%	1.30% to 2.00%	(15.16)	%	to	(15.72)	%
	2017	148	$	11.54	to	$	11.64	$	1,738	0.97	%	1.30% to 2.00%	27.80	%	to	26.80	%
	2016	130	$	9.03	to	$	9.18	$	1,195	1.17	%	1.30% to 2.00%	3.91	%	to	3.26	%
	2015	50	$	8.69	to	$	8.89	$	441	0.67	%	1.30% to 2.00%	(4.40)	%	to	(10.83)	%
American Funds Insurance Series New World Fund Class 4:
	2019	189	$	10.90	to	$	12.14	$	2,183	0.92	%	0.75% to 1.40%	27.93	%	to	26.99	%
	2018	117	$	8.52	to	$	9.56	$	1,091	0.84	%	0.75% to 1.40%	(14.63)	%	to	(15.40)	%
	2017	61	$	11.65	to	$	11.30	$	703	1.02	%	1.00% to 1.40%	16.62	%	to	27.25	%
	2016	37	$	8.93	to	$	8.88	$	329	0.54	%	1.15% to 1.40%	3.84	%	to	3.62	%
	2015	46	$	8.60	to	$	8.57	$	394	0.63	%	1.15% to 1.40%	(4.44)	%	to	(4.78)	%
BlackRock 60/40 Target Allocation Class III:
	2019 (12)	68	$	11.46	to	$	11.76	$	799	2.53	%	0.75% to 2.00%	20.25	%	to	18.79	%
	2018	55	$	9.53	to	$	9.90	$	553	1.02	%	0.75% to 2.00%	(4.70)	%	to	(7.04)	%
	2017	25	$	11.00	to	$	10.65	$	266	2.33	%	1.00% to 2.00%	9.67	%	to	12.46	%
	2016	11	$	9.60	to	$	9.47	$	107	2.28	%	1.15% to 2.00%	4.92	%	to	4.07	%
	2015 (5)	7	$	9.15	to	$	9.10	$	60	6.90	%	1.15% to 2.00%	(8.32)	%	to	(8.82)	%
BlackRock Advantage U.S. Total Market Class III:
	2019	76	$	11.98	to	$	14.34	$	1,002	2.17	%	0.75% to 1.40%	27.72	%	to	26.90	%
	2018	79	$	9.38	to	$	11.30	$	814	2.49	%	0.75% to 1.40%	(6.76)	%	to	(7.98)	%
	2017	13	$	11.64	to	$	12.28	$	150	—%		1.00% to 1.40%	15.02	%	to	12.25	%
	2016	3	$	10.98	to	$	10.94	$	31	0.94	%	1.15% to 1.40%	22.00	%	to	21.69	%
	2015 (5)	—	$	9.00	to	$	8.99	$	1	0.94	%	1.15% to 1.40%	(10.89)	%	to	(10.99)	%
BlackRock Global Allocation Class III:
	2019	192	$	10.84	to	$	10.97	$	2,140	1.39	%	0.75% to 2.00%	16.81	%	to	15.35	%
	2018	167	$	9.28	to	$	9.51	$	1,618	0.99	%	0.75% to 2.00%	(7.11)	%	to	(9.34)	%
	2017	119	$	10.83	to	$	10.49	$	1,268	1.34	%	1.00% to 2.00%	8.19	%	to	11.36	%
	2016	105	$	9.55	to	$	9.42	$	996	1.36	%	1.15% to 2.00%	2.69	%	to	1.84	%
	2015 (5)	56	$	9.30	to	$	9.25	$	522	1.85	%	1.15% to 2.00%	(7.00)	%	to	(7.50)	%

A-112

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
BNY Mellon IP MidCap Stock Service Shares:
	2019 (13)	50	$	10.32	to	$	11.73	$	547	0.38	%	0.75% to 1.40%	18.89	%	to	18.25	%
	2018	46	$	8.68	to	$	9.92	$	429	0.24	%	0.75% to 1.40%	(3.90)	%	to	(6.56)	%
	2017	14	$	11.23	to	$	11.93	$	162	0.69	%	1.00% to 1.40%	11.41	%	to	13.40	%
	2016	10	$	10.56	to	$	10.52	$	105	0.75	%	1.15% to 1.40%	13.92	%	to	13.61	%
	2015 (5)	5	$	9.27	to	$	9.26	$	44	—%		1.15% to 1.40%	(8.13)	%	to	(8.23)	%
BNY Mellon IP Technology Growth Service Shares:
	2019 (14)	213	$	41.00	to	$	37.39	$	8,638	—%		1.40% to 2.00%	23.75	%	to	23.03	%
	2018	261	$	33.13	to	$	30.39	$	8,555	—%		1.40% to 2.00%	(2.64)	%	to	(3.22)	%
	2017	305	$	34.03	to	$	31.40	$	10,254	—%		1.40% to 2.00%	40.39	%	to	39.56	%
	2016	271	$	24.24	to	$	22.50	$	6,464	—%		1.40% to 2.00%	2.93	%	to	2.32	%
	2015	266	$	23.55	to	$	21.99	$	6,205	—%		1.40% to 2.00%	4.43	%	to	3.78	%
Calvert EAFE International Index Class F:
	2019	126	$	10.23	to	$	11.01	$	1,308	3.18	%	0.75% to 1.40%	20.07	%	to	19.28	%
	2018	65	$	8.52	to	$	9.23	$	565	7.15	%	0.75% to 1.40%	(14.54)	%	to	(15.01)	%
	2017	10	$	11.56	to	$	10.86	$	111	1.76	%	1.00% to 1.40%	15.60	%	to	22.71	%
	2016	2	$	8.90	to	$	8.85	$	19	4.06	%	1.15% to 1.40%	(0.89)	%	to	(1.12)	%
	2015	2	$	8.98	to	$	8.95	$	15	0.04	%	1.15% to 1.40%	(2.92)	%	to	(3.24)	%
Calvert Investment Grade Bond Portfolio Class F:
	2019	87	$	10.87	to	$	10.76	$	943	5.01	%	0.75% to 1.40%	7.31	%	to	6.64	%
	2018 (10)	16	$	10.13	to	$	10.09	$	164	8.71	%	0.75% to 1.40%	1.40	%	to	1.00	%
Calvert Russell 2000 Small Cap Index Class F:
	2019	236	$	10.85	to	$	14.05	$	2,708	1.01	%	0.75% to 1.40%	23.86	%	to	23.14	%
	2018	155	$	8.76	to	$	11.41	$	1,479	1.27	%	0.75% to 1.40%	(12.84)	%	to	(12.70)	%
	2017	66	$	11.34	to	$	13.07	$	773	1.15	%	1.00% to 1.40%	12.39	%	to	12.48	%
	2016	13	$	11.69	to	$	11.62	$	155	0.52	%	1.15% to 1.40%	19.29	%	to	18.94	%
	2015	11	$	9.80	to	$	9.77	$	103	—%		1.15% to 1.40%	(6.49)	%	to	(6.69)	%
Calvert S&P MidCap 400 Index Class F:
	2019	376	$	11.10	to	$	14.25	$	4,489	1.26	%	0.75% to 1.40%	24.58	%	to	23.81	%
	2018	243	$	8.91	to	$	11.51	$	2,436	1.31	%	0.75% to 1.40%	(11.25)	%	to	(12.80)	%
	2017	162	$	11.22	to	$	13.20	$	1,954	0.93	%	1.00% to 1.40%	11.31	%	to	13.99	%
	2016	65	$	11.64	to	$	11.58	$	751	0.66	%	1.15% to 1.40%	18.53	%	to	18.28	%
	2015	49	$	9.82	to	$	9.79	$	480	—%		1.15% to 1.40%	(4.01)	%	to	(4.21)	%

A-113

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
ClearBridge Small Cap Growth Class II:
	2019	157	$	12.02	to	$	15.29	$	2,018	—%		0.75% to 1.40%	25.60	%	to	24.82	%
	2018	102	$	9.57	to	$	12.25	$	1,115	—%		0.75% to 1.40%	(4.78)	%	to	1.74	%
	2017	31	$	11.93	to	$	12.04	$	373	—%		1.00% to 1.40%	18.24	%	to	22.23	%
	2016	1	$	9.89	to	$	9.85	$	13	—%		1.15% to 1.40%	4.32	%	to	4.01	%
	2015 (5)	1	$	9.48	to	$	9.47	$	9	—%		1.15% to 1.40%	(6.51)	%	to	(6.61)	%
Columbia Limited Duration Credit Class 2:
	2019	39	$	10.71	to	$	10.13	$	405	1.97	%	0.75% to 2.00%	6.67	%	to	5.41	%
	2018	19	$	10.04	to	$	9.61	$	191	1.55	%	0.75% to 2.00%	0.50	%	to	(2.04)	%
	2017	21	$	10.03	to	$	9.81	$	208	2.04	%	1.00% to 2.00%	0.30	%	to	(0.20)	%
	2016	19	$	9.97	to	$	9.83	$	185	2.33	%	1.15% to 2.00%	4.07	%	to	3.26	%
	2015 (5)	15	$	9.58	to	$	9.52	$	140	—%		1.15% to 2.00%	(4.20)	%	to	(4.80)	%
Columbia Small Cap Value Class 2:
	2019	95	$	10.05	to	$	12.87	$	1,034	0.27	%	0.75% to 1.40%	20.07	%	to	19.28	%
	2018	59	$	8.37	to	$	10.79	$	566	0.17	%	0.75% to 1.40%	(16.88)	%	to	(19.30)	%
	2017	38	$	11.53	to	$	13.37	$	480	0.33	%	1.00% to 1.40%	14.05	%	to	12.35	%
	2016	20	$	11.94	to	$	11.90	$	244	0.26	%	1.15% to 1.40%	31.21	%	to	30.91	%
	2015 (5)	8	$	9.10	to	$	9.09	$	75	0.73	%	1.15% to 1.40%	(9.90)	%	to	(9.91)	%
Core Plus Bond Class 1:
	2019	5,337	$	3.26	to	$	23.21	$	116,174	3.25	%	0.42% to 2.00%	9.35	%	to	7.65	%
	2018	5,240	$	2.98	to	$	21.56	$	109,852	3.32	%	0.46% to 2.00%	(1.83)	%	to	(3.41)	%
	2017	6,196	$	3.04	to	$	22.32	$	131,734	2.86	%	0.42% to 2.00%	4.37	%	to	2.76	%
	2016	6,529	$	2.91	to	$	21.72	$	138,244	3.07	%	0.43% to 2.00%	3.65	%	to	2.02	%
	2015	7,246	$	2.81	to	$	21.29	$	151,328	3.09	%	0.43% to 2.00%	(0.90)	%	to	(2.47)	%
Delaware Limited Term Diversified Income Service Class:
	2019	47	$	10.45	to	$	9.86	$	476	2.36	%	0.75% to 2.00%	3.98	%	to	2.71	%
	2018	38	$	10.05	to	$	9.60	$	374	2.34	%	0.75% to 2.00%	0.50	%	to	(1.94)	%
	2017	30	$	10.03	to	$	9.79	$	302	1.90	%	1.00% to 2.00%	0.30	%	to	(0.10)	%
	2016	94	$	9.93	to	$	9.80	$	931	1.35	%	1.15% to 2.00%	0.51	%	to	(0.20)	%
	2015 (5)	23	$	9.88	to	$	9.82	$	227	1.11	%	1.15% to 2.00%	(1.00)	%	to	(1.60)	%

A-114

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value											Total return (3)
			corresponding									Expense		corresponding
			to lowest					Net		Investment		ratio (2)		to lowest
		Units	to highest					assets		income		lowest to		to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest		expense ratio
Delaware Small Cap Value Service Class:
	2019	160	$	16.19	to	$	15.45	$	2,563	0.78	%	1.30% to 2.00%		26.09	%	to	25.20	%
	2018	170	$	12.84	to	$	12.34	$	2,167	0.59	%	1.30% to 2.00%		(18.01)	%	to	(18.66)	%
	2017	176	$	15.66	to	$	15.17	$	2,726	0.66	%	1.30% to 2.00%		10.28	%	to	9.61	%
	2016	160	$	14.20	to	$	13.84	$	2,248	0.64	%	1.30% to 2.00%		29.44	%	to	28.51	%
	2015	93	$	10.97	to	$	10.77	$	1,009	0.42	%	1.30% to 2.00%		(7.66)	%	to	(8.34)	%
Diversified Balanced Class 1:
	2019	2,112	$	12.06	to	$	11.60	$	24,944	2.12	%	0.46% to 1.90%		17.93	%	to	16.23	%
	2018	2,269	$	10.23	to	$	9.98	$	22,898	2.73	%	0.59% to 1.90%		(3.55)	%	to	(4.95)	%
	2017 (9)	2,579	$	10.60	to	$	10.50	$	27,197	2.43	%	0.53% to 1.90%		—	%	to	5.00	%
Diversified Balanced Class 2:
	2019	55,109	$	18.10	to	$	17.05	$	988,423	1.81	%	1.40% to 2.00%		16.55	%	to	15.91	%
	2018	62,817	$	10.21	to	$	14.71	$	968,136	2.39	%	1.40% to 2.00%		(4.72)	%	to	(5.34)	%
	2017	69,727	$	10.72	to	$	15.54	$	1,131,092	—%		1.40% to 2.00%		6.99	%	to	9.28	%
	2016	74,396	$	14.83	to	$	14.22	$	1,099,762	1.25	%	1.40% to 2.00%		5.40	%	to	4.79	%
	2015	73,477	$	14.07	to	$	13.57	$	1,030,997	1.00	%	1.40% to 2.00%		(1.26)	%	to	(1.88)	%
Diversified Balanced Managed Volatility Class 2:
	2019	13,367	$	11.37	to	$	12.81	$	176,258	1.61	%	0.75% to 2.00%		16.62	%	to	15.20	%
	2018	14,217	$	9.75	to	$	11.12	$	162,127	3.68	%	0.75% to 2.00%		(2.50)	%	to	(5.12)	%
	2017	15,118	$	10.71	to	$	11.72	$	181,077	1.29	%	1.00% to 2.00%		6.89	%	to	8.72	%
	2016	15,384	$	10.57	to	$	10.78	$	168,723	0.69	%	1.15% to 2.00%		5.17	%	to	4.26	%
	2015	13,227	$	10.05	to	$	10.34	$	138,378	0.84	%	1.15% to 2.00%		(1.08)	%	to	(1.90)	%
Diversified Balanced Volatility Control Class 2:
	2019	12,527				$	11.60	$	145,328	0.95	%	1.40	%				13.84	%
	2018	6,572				$	10.19	$	66,956	0.77	%	1.40	%				(5.03)	%
	2017 (8)	3,405				$	10.73	$	36,539	—%		1.40	%				7.09	%
Diversified Growth Class 2:
	2019	188,483	$	12.30	to	$	19.12	$	3,772,917	1.74	%	1.40% to 2.00%		19.53	%	to	18.83	%
	2018	207,515	$	10.29	to	$	16.09	$	3,487,376	2.50	%	1.40% to 2.00%		(5.88)	%	to	(6.40)	%
	2017	219,749	$	10.93	to	$	17.19	$	3,946,890	1.36	%	1.40% to 2.00%		9.08	%	to	11.91	%
	2016	224,677	$	16.02	to	$	15.36	$	3,589,242	1.24	%	1.40% to 2.00%		6.66	%	to	6.00	%
	2015	213,718	$	15.02	to	$	14.49	$	3,202,277	1.03	%	1.40% to 2.00%		(1.18)	%	to	(1.83)	%

A-115

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value											Total return (3)
			corresponding									Expense		corresponding
			to lowest					Net		Investment		ratio (2)		to lowest
		Units	to highest					assets		income		lowest to		to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest		expense ratio
Diversified Growth Managed Volatility Class 2:
	2019	25,503	$	11.48	to	$	13.50	$	353,685	1.54	%	0.75% to 2.00%		19.33	%	to	17.80	%
	2018	27,701	$	9.62	to	$	11.46	$	325,257	4.18	%	0.75% to 2.00%		(3.90)	%	to	(5.99)	%
	2017	28,510	$	10.89	to	$	12.19	$	354,954	1.24	%	1.00% to 2.00%		8.68	%	to	11.12	%
	2016	28,091	$	10.67	to	$	10.97	$	313,613	0.60	%	1.15% to 2.00%		6.38	%	to	5.38	%
	2015	23,991	$	10.03	to	$	10.41	$	252,642	1.04	%	1.15% to 2.00%		(1.08)	%	to	(1.89)	%
Diversified Growth Volatility Control Class 2:
	2019	64,303				$	11.90	$	765,294	0.97	%	1.40	%				15.87	%
	2018	37,493				$	10.27	$	384,857	0.75	%	1.40	%				(5.87)	%
	2017 (8)	15,735				$	10.91	$	171,699	—%		1.40	%				8.77	%
Diversified Income Class 2:
	2019	20,567	$	11.52	to	$	13.59	$	279,864	1.65	%	1.40% to 2.00%		13.50	%	to	12.87	%
	2018	19,716	$	10.15	to	$	12.04	$	241,402	2.07	%	1.40% to 2.00%		(3.76)	%	to	(4.37)	%
	2017	20,774	$	10.54	to	$	12.59	$	268,177	1.38	%	1.40% to 2.00%		5.19	%	to	6.69	%
	2016	20,962	$	12.13	to	$	11.80	$	254,023	1.00	%	1.40% to 2.00%		4.03	%	to	3.42	%
	2015	17,071	$	11.66	to	$	11.41	$	198,791	0.78	%	1.40% to 2.00%		(1.19)	%	to	(1.81)	%
Diversified International Class 1:
	2019	3,882	$	4.09	to	$	29.45	$	103,484	1.63	%	0.40% to 2.00%		22.17	%	to	20.25	%
	2018	4,206	$	3.35	to	$	24.49	$	95,801	2.12	%	0.46% to 2.00%		(17.88)	%	to	(19.17)	%
	2017	4,720	$	4.08	to	$	30.30	$	131,186	1.81	%	0.43% to 2.00%		28.52	%	to	26.51	%
	2016	5,292	$	3.17	to	$	23.95	$	117,981	2.32	%	0.41% to 2.00%		(0.06)	%	to	(1.60)	%
	2015	5,938	$	3.17	to	$	24.34	$	136,019	2.51	%	0.44% to 2.00%		(0.77)	%	to	(2.33)	%
DWS Alternative Asset Allocation Class B:
	2019	4	$	10.72	to	$	9.96	$	44	3.51	%	0.75% to 1.40%		13.56	%	to	12.67	%
	2018	4	$	9.44	to	$	8.84	$	37	1.75	%	0.75% to 1.40%		(5.51)	%	to	(10.62)	%
	2017	4	$	10.41	to	$	9.89	$	40	2.10	%	1.00% to 1.40%		4.00	%	to	5.55	%
	2016	5	$	9.42	to	$	9.37	$	42	1.90	%	1.15% to 1.40%		3.74	%	to	3.54	%
	2015	4	$	9.08	to	$	9.05	$	40	—%		1.15% to 1.40%		(7.63)	%	to	(7.84)	%
DWS Equity 500 Index Class B2:
	2019	175	$	12.33	to	$	16.07	$	2,491	1.48	%	0.75% to 1.40%		29.65	%	to	28.77	%
	2018	149	$	9.51	to	$	12.48	$	1,691	1.21	%	0.75% to 1.40%		(5.18)	%	to	(6.31)	%
	2017	103	$	11.39	to	$	13.32	$	1,324	1.21	%	1.00% to 1.40%		13.67	%	to	19.35	%
	2016	82	$	11.22	to	$	11.16	$	919	1.49	%	1.15% to 1.40%		9.89	%	to	9.63	%
	2015	67	$	10.21	to	$	10.18	$	678	1.24	%	1.15% to 1.40%		(0.39)	%	to	(0.59)	%

A-116

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
DWS Small Mid Cap Value Class B:
	2019	118	$	10.23	to	$	13.42	$	1,469	0.36	%	0.75% to 2.00%	20.07	%	to	18.55	%
	2018	100	$	8.52	to	$	11.32	$	1,084	0.99	%	0.75% to 2.00%	(15.22)	%	to	(17.97)	%
	2017	92	$	10.81	to	$	13.80	$	1,242	0.36	%	1.00% to 2.00%	7.24	%	to	7.98	%
	2016	91	$	11.23	to	$	12.78	$	1,157	0.22	%	1.15% to 2.00%	15.18	%	to	14.11	%
	2015	85	$	9.75	to	$	11.20	$	953	—%		1.15% to 2.00%	(3.37)	%	to	(4.11)	%
EQ Convertible Securities Class IB:
	2019 (11)	—	$	10.93	to	$	10.85	$	—	—%		0.75% to 2.00%	9.30	%	to	8.50	%
EQ GAMCO Small Company Value Class IB:
	2019 (11)	5	$	10.87	to	$	10.80	$	55	1.76	%	0.75% to 2.00%	8.70	%	to	8.00	%
EQ Micro Cap Class IB:
	2019 (11)	1	$	10.94	to	$	10.86	$	10	0.27	%	0.75% to 2.00%	9.40	%	to	8.60	%
EQ SmartBeta Equity Class IB:
	2019 (11)	6	$	10.86	to	$	10.78	$	62	3.05	%	0.75% to 2.00%	8.60	%	to	7.80	%
EQ Socially Responsible Class IB:
	2019 (11)	1	$	11.24	to	$	11.16	$	17	1.95	%	0.75% to 2.00%	12.40	%	to	11.60	%
Equity Income Class 1:
	2019	11,634	$	89.57	to	$	21.28	$	229,475	1.88	%	0.56% to 2.00%	28.47	%	to	26.52	%
	2018	13,701	$	69.72	to	$	16.82	$	215,812	1.73	%	0.09% to 2.00%	—	%	to	(6.92)	%
	2017	10,292	$	2.61	to	$	18.07	$	197,554	2.21	%	0.44% to 2.00%	20.57	%	to	18.73	%
	2016	12,338	$	2.17	to	$	15.22	$	198,801	2.68	%	0.39% to 2.00%	15.24	%	to	13.41	%
	2015	14,715	$	1.88	to	$	13.42	$	207,674	2.43	%	0.55% to 2.00%	(4.33)	%	to	(5.82)	%
Equity Income Class 2:
	2019	573	$	12.28	to	$	15.54	$	7,665	1.75	%	0.75% to 1.40%	27.78	%	to	26.96	%
	2018	396	$	9.61	to	$	12.24	$	4,292	1.76	%	0.75% to 1.40%	(3.90)	%	to	(6.56)	%
	2017	201	$	11.50	to	$	13.10	$	2,508	2.21	%	1.00% to 1.40%	14.66	%	to	19.09	%
	2016	115	$	11.06	to	$	11.00	$	1,263	2.61	%	1.15% to 1.40%	14.14	%	to	13.87	%
	2015	104	$	9.69	to	$	9.66	$	1,006	3.12	%	1.15% to 1.40%	(5.28)	%	to	(5.48)	%

A-117

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Fidelity VIP Contrafund Service Class:
	2019	990	$	36.21	to	$	32.28	$	35,860	0.35	%	1.30% to 1.90%	29.78	%	to	28.97	%
	2018	1,181	$	27.90	to	$	25.03	$	32,952	0.59	%	1.30% to 1.90%	(7.71)	%	to	(8.25)	%
	2017	1,388	$	30.23	to	$	27.28	$	41,949	0.89	%	1.30% to 1.90%	20.20	%	to	19.44	%
	2016	1,566	$	25.15	to	$	22.84	$	39,392	0.70	%	1.30% to 1.90%	6.52	%	to	5.89	%
	2015	1,786	$	23.61	to	$	21.57	$	42,171	0.90	%	1.30% to 1.90%	(0.76)	%	to	(1.33)	%
Fidelity VIP Contrafund Service Class 2:
	2019	1,833	$	12.00	to	$	31.35	$	50,633	0.21	%	0.75% to 2.00%	30.29	%	to	28.64	%
	2018	1,897	$	9.21	to	$	24.37	$	43,924	0.43	%	0.75% to 2.00%	(8.08)	%	to	(8.49)	%
	2017	1,967	$	11.28	to	$	26.63	$	52,563	0.77	%	1.00% to 2.00%	12.35	%	to	19.20	%
	2016	2,089	$	10.75	to	$	22.34	$	48,208	0.60	%	1.15% to 2.00%	6.54	%	to	5.58	%
	2015	2,325	$	10.09	to	$	21.16	$	50,809	0.80	%	1.15% to 2.00%	(0.79)	%	to	(1.58)	%
Fidelity VIP Equity-Income Service Class 2:
	2019	1,165	$	24.64	to	$	22.02	$	28,581	1.78	%	1.30% to 2.00%	25.46	%	to	24.55	%
	2018	1,306	$	19.64	to	$	17.68	$	25,518	2.03	%	1.30% to 2.00%	(9.70)	%	to	(10.34)	%
	2017	1,472	$	21.75	to	$	19.72	$	31,878	1.49	%	1.30% to 2.00%	11.20	%	to	10.41	%
	2016	1,624	$	19.56	to	$	17.86	$	31,630	2.05	%	1.30% to 2.00%	16.15	%	to	15.37	%
	2015	1,877	$	16.84	to	$	15.48	$	31,472	2.86	%	1.30% to 2.00%	(5.45)	%	to	(6.12)	%
Fidelity VIP Freedom 2020 Service Class 2:
	2019 (11)	13	$	10.76	to	$	10.72	$	142	4.55	%	0.75% to 1.40%	7.60	%	to	7.20	%
Fidelity VIP Freedom 2030 Service Class 2:
	2019 (11)	27	$	10.92	to	$	10.88	$	298	7.14	%	0.75% to 1.40%	9.20	%	to	8.80	%
Fidelity VIP Freedom 2040 Service Class 2:
	2019 (11)	65	$	11.09	to	$	11.05	$	720	6.44	%	0.75% to 1.40%	10.90	%	to	10.50	%
Fidelity VIP Freedom 2050 Service Class 2:
	2019 (11)	16	$	11.10	to	$	11.06	$	178	5.99	%	0.75% to 1.40%	11.00	%	to	10.60	%
Fidelity VIP Government Money Market Initial Class:
	2019	7,795	$	1.03	to	$	9.68	$	31,462	2.04	%	0.44% to 2.00%	1.59	%	to	—	%
	2018	8,644	$	1.01	to	$	9.68	$	41,119	1.59	%	0.37% to 2.00%	1.21	%	to	(0.31)	%
	2017	7,283	$	1.00	to	$	9.71	$	34,519	0.66	%	0.42% to 2.00%	0.21	%	to	(1.32)	%
	2016 (6)	8,827	$	1.00	to	$	0.99	$	47,450	0.22	%	0.59% to 2.19%	—	%	to	—	%

A-118

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value											Total return (3)
			corresponding									Expense		corresponding
			to lowest					Net		Investment		ratio (2)		to lowest
		Units	to highest					assets		income		lowest to		to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest		expense ratio
Fidelity VIP Government Money Market Service Class 2:
	2019	880	$	10.16	to	$	9.97	$	8,850	1.70	%	0.75% to 1.40%		1.09	%	to	0.40	%
	2018	768	$	10.05	to	$	9.93	$	7,639	1.33	%	0.75% to 1.40%		0.50	%	to	(0.10)	%
	2017	310	$	9.96	to	$	9.94	$	3,084	0.42	%	1.00% to 1.40%		(0.40)	%	to	(0.60)	%
	2016 (6)	391	$	9.90	to	$	9.88	$	3,865	0.02	%	1.15% to 1.40%		(1.00)	%	to	(1.20)	%
Fidelity VIP Growth Service Class:
	2019	545	$	26.73	to	$	23.83	$	14,563	0.16	%	1.30% to 1.90%		32.46	%	to	31.66	%
	2018	644	$	20.18	to	$	18.10	$	12,987	0.15	%	1.30% to 1.90%		(1.56)	%	to	(2.16)	%
	2017	730	$	20.50	to	$	18.50	$	14,958	0.12	%	1.30% to 1.90%		33.29	%	to	32.43	%
	2016	779	$	15.38	to	$	13.97	$	11,979	—%		1.30% to 1.90%		(0.65)	%	to	(1.13)	%
	2015	917	$	15.48	to	$	14.13	$	14,193	0.16	%	1.30% to 1.90%		5.74	%	to	4.98	%
Fidelity VIP Growth Service Class 2:
	2019	346	$	35.81	to	$	32.65	$	12,287	0.05	%	1.40% to 2.00%		32.14	%	to	31.34	%
	2018	383	$	27.10	to	$	24.86	$	10,302	0.04	%	1.40% to 2.00%		(1.85)	%	to	(2.43)	%
	2017	421	$	27.61	to	$	25.48	$	11,548	0.08	%	1.40% to 2.00%		33.00	%	to	32.16	%
	2016	430	$	20.76	to	$	19.28	$	8,861	—%		1.40% to 2.00%		(0.86)	%	to	(1.43)	%
	2015	480	$	20.94	to	$	19.56	$	9,985	0.03	%	1.40% to 2.00%		5.39	%	to	4.77	%
Fidelity VIP Mid Cap Service Class:
	2019	7				$	14.27	$	95	0.80	%	0.95	%				22.17	%
	2018	7				$	11.68	$	78	0.40	%	0.95	%				(15.42)	%
	2017	49				$	13.81	$	674	0.62	%	0.95	%				19.57	%
	2016	49				$	11.55	$	563	0.53	%	0.95	%				11.06	%
	2015	7				$	10.40	$	69	0.41	%	0.95	%				(2.44)	%
Fidelity VIP Mid Cap Service Class 2:
	2019	1,169	$	10.30	to	$	30.72	$	25,934	0.68	%	0.75% to 2.00%		22.33	%	to	20.75	%
	2018	1,047	$	8.42	to	$	25.44	$	21,792	0.41	%	0.75% to 2.00%		(15.88)	%	to	(16.48)	%
	2017	914	$	11.55	to	$	30.46	$	25,998	0.49	%	1.00% to 2.00%		14.58	%	to	18.15	%
	2016	830	$	10.82	to	$	25.78	$	21,339	0.31	%	1.15% to 2.00%		10.63	%	to	9.70	%
	2015	829	$	9.78	to	$	23.50	$	19,266	0.27	%	1.15% to 2.00%		(2.78)	%	to	(3.57)	%
Fidelity VIP Overseas Service Class 2:
	2019	1,180	$	10.72	to	$	18.84	$	23,490	1.46	%	0.75% to 2.00%		26.56	%	to	25.02	%
	2018	1,398	$	8.47	to	$	15.07	$	22,377	1.29	%	0.75% to 2.00%		(14.79)	%	to	(16.79)	%
	2017	1,487	$	11.88	to	$	18.11	$	28,448	1.15	%	1.00% to 2.00%		18.92	%	to	27.45	%
	2016	1,731	$	9.02	to	$	14.21	$	26,313	1.18	%	1.15% to 2.00%		(6.33)	%	to	(7.12)	%
	2015	1,940	$	9.63	to	$	15.30	$	31,477	1.08	%	1.15% to 2.00%		2.12	%	to	1.26	%

A-119

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Franklin Global Real Estate VIP Class 2:
	2019	118	$	11.53	to	$	11.15	$	1,397	2.23	%	0.75% to 2.00%	21.50	%	to	19.89	%
	2018	79	$	9.49	to	$	9.30	$	790	2.72	%	0.75% to 2.00%	(5.38)	%	to	(8.64)	%
	2017	66	$	10.70	to	$	10.18	$	715	3.04	%	1.00% to 2.00%	6.57	%	to	8.30	%
	2016	61	$	10.43	to	$	9.40	$	613	1.19	%	1.15% to 2.00%	(0.67)	%	to	(1.47)	%
	2015	48	$	10.50	to	$	9.54	$	497	3.78	%	1.15% to 2.00%	(0.57)	%	to	(4.02)	%
Franklin Income VIP Class 4:
	2019	116	$	10.83	to	$	10.72	$	1,253	4.07	%	0.75% to 1.40%	15.21	%	to	14.41	%
	2018 (10)	9	$	9.40	to	$	9.37	$	87	—%		0.75% to 1.40%	(6.37)	%	to	(6.58)	%
Franklin Rising Dividends VIP Class 4:
	2019	206	$	12.38	to	$	15.86	$	2,842	1.10	%	0.75% to 1.40%	28.16	%	to	27.39	%
	2018	131	$	9.66	to	$	12.45	$	1,480	1.21	%	0.75% to 1.40%	(3.50)	%	to	(6.53)	%
	2017	104	$	11.48	to	$	13.32	$	1,339	1.37	%	1.00% to 1.40%	14.46	%	to	18.82	%
	2016	72	$	11.28	to	$	11.21	$	808	1.21	%	1.15% to 1.40%	14.63	%	to	14.27	%
	2015	48	$	9.84	to	$	9.81	$	470	1.49	%	1.15% to 1.40%	(4.84)	%	to	(5.13)	%
Franklin Small Cap Value VIP Class 2:
	2019	158	$	25.86	to	$	24.20	$	4,044	1.05	%	1.30% to 2.00%	24.75	%	to	23.85	%
	2018	178	$	20.73	to	$	19.54	$	3,647	0.88	%	1.30% to 2.00%	(14.02)	%	to	(14.60)	%
	2017	206	$	24.11	to	$	22.88	$	4,897	0.52	%	1.30% to 2.00%	9.24	%	to	8.49	%
	2016	253	$	22.07	to	$	21.09	$	5,529	0.76	%	1.30% to 2.00%	28.46	%	to	27.59	%
	2015	191	$	17.18	to	$	16.53	$	3,252	0.62	%	1.30% to 2.00%	(8.57)	%	to	(9.23)	%
Franklin U.S. Government Fund Class 2:
	2019 (11)	32	$	10.16	to	$	10.12	$	323	—%		0.75% to 1.40%	1.40	%	to	1.00	%
Goldman Sachs VIT Mid Cap Value Institutional Shares:
	2019	390	$	30.72	to	$	27.83	$	11,835	0.76	%	1.30% to 2.00%	29.84	%	to	28.90	%
	2018	456	$	23.66	to	$	21.59	$	10,678	1.29	%	1.30% to 2.00%	(11.62)	%	to	(12.24)	%
	2017	509	$	26.77	to	$	24.60	$	13,514	0.71	%	1.30% to 2.00%	9.62	%	to	8.90	%
	2016	586	$	24.42	to	$	22.59	$	14,216	1.31	%	1.30% to 2.00%	12.07	%	to	11.28	%
	2015	689	$	21.79	to	$	20.30	$	14,902	0.38	%	1.30% to 2.00%	(10.40)	%	to	(11.04)	%

A-120

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Goldman Sachs VIT Mid Cap Value Service Shares:
	2019	119	$	11.74	to	$	12.71	$	1,445	0.74	%	0.75% to 1.40%	30.16	%	to	29.43	%
	2018	69	$	9.02	to	$	9.82	$	658	0.65	%	0.75% to 1.40%	(9.71)	%	to	(12.01)	%
	2017	50	$	10.73	to	$	11.16	$	558	0.53	%	1.00% to 1.40%	6.55	%	to	9.30	%
	2016	45	$	10.26	to	$	10.21	$	459	1.08	%	1.15% to 1.40%	11.89	%	to	11.71	%
	2015	51	$	9.17	to	$	9.14	$	469	0.18	%	1.15% to 1.40%	(10.54)	%	to	(10.74)	%
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio Service Shares:
	2019	7	$	10.19	to	$	9.44	$	68	3.05	%	0.75% to 1.40%	8.06	%	to	7.39	%
	2018	5	$	9.43	to	$	8.79	$	46	5.14	%	0.75% to 1.40%	(5.61)	%	to	(8.25)	%
	2017	—	$	10.20	to	$	9.58	$	2	3.31	%	1.00% to 1.40%	2.00	%	to	3.90	%
	2016	—	$	9.26	to	$	9.22	$	—	—%		1.15% to 1.40%	(0.86)	%	to	(1.18)	%
	2015 (5)	1	$	9.34	to	$	9.33	$	12	6.02	%	1.15% to 1.40%	(6.69)	%	to	(6.79)	%
Goldman Sachs VIT Small Cap Equity Insights Institutional Shares:
	2019	226	$	26.43	to	$	23.95	$	5,916	0.46	%	1.30% to 2.00%	23.22	%	to	22.38	%
	2018	270	$	21.45	to	$	19.57	$	5,728	0.47	%	1.30% to 2.00%	(9.80)	%	to	(10.43)	%
	2017	291	$	23.78	to	$	21.85	$	6,852	0.53	%	1.30% to 2.00%	10.14	%	to	9.36	%
	2016	323	$	21.59	to	$	19.98	$	6,918	1.15	%	1.30% to 2.00%	21.57	%	to	20.80	%
	2015	351	$	17.76	to	$	16.54	$	6,193	0.28	%	1.30% to 2.00%	(3.37)	%	to	(4.12)	%
Goldman Sachs VIT Small Cap Equity Insights Service Shares:
	2019	52	$	10.93	to	$	14.98	$	627	0.27	%	0.75% to 1.40%	23.64	%	to	22.79	%
	2018	33	$	8.84	to	$	12.20	$	337	0.28	%	0.75% to 1.40%	(11.95)	%	to	(10.10)	%
	2017	15	$	11.29	to	$	13.57	$	187	0.41	%	1.00% to 1.40%	11.67	%	to	9.61	%
	2016	8	$	12.45	to	$	12.38	$	99	0.39	%	1.15% to 1.40%	21.58	%	to	21.37	%
	2015	10	$	10.24	to	$	10.20	$	107	0.05	%	1.15% to 1.40%	(3.58)	%	to	(3.86)	%
Government & High Quality Bond Class 1:
	2019	7,169	$	3.06	to	$	11.84	$	81,190	2.72	%	0.40% to 2.00%	6.01	%	to	4.32	%
	2018	7,616	$	2.98	to	$	11.35	$	83,790	3.77	%	0.39% to 2.00%	0.49	%	to	(1.05)	%
	2017	9,071	$	2.88	to	$	11.47	$	98,248	3.94	%	0.42% to 2.00%	1.45	%	to	(0.17)	%
	2016	9,919	$	2.84	to	$	11.49	$	110,034	3.50	%	0.51% to 2.00%	1.37	%	to	(0.17)	%
	2015	10,832	$	2.80	to	$	11.51	$	121,664	3.26	%	0.42% to 2.00%	0.37	%	to	(1.20)	%

A-121

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Guggenheim Floating Rate Strategies Series F:
	2019	295	$	10.41	to	$	10.71	$	3,213	4.81	%	0.75% to 2.00%	6.77	%	to	5.52	%
	2018	333	$	9.75	to	$	10.15	$	3,431	2.63	%	0.75% to 2.00%	(2.50)	%	to	(2.78)	%
	2017	172	$	10.17	to	$	10.44	$	1,825	2.85	%	1.00% to 2.00%	1.70	%	to	1.36	%
	2016	154	$	10.62	to	$	10.30	$	1,598	5.18	%	1.15% to 2.00%	7.27	%	to	6.40	%
	2015	81	$	9.90	to	$	9.68	$	787	2.66	%	1.15% to 2.00%	(0.40)	%	to	(3.20)	%
Guggenheim Investments Global Managed Futures Strategy:
	2019	19	$	9.76	to	$	8.09	$	178	0.98	%	0.75% to 2.00%	7.37	%	to	6.03	%
	2018	21	$	9.09	to	$	7.63	$	182	—%		0.75% to 2.00%	(8.83)	%	to	(10.86)	%
	2017	13	$	10.60	to	$	8.56	$	118	1.54	%	1.00% to 2.00%	5.79	%	to	6.60	%
	2016	17	$	8.82	to	$	8.03	$	143	3.42	%	1.15% to 2.00%	(15.68)	%	to	(16.53)	%
	2015	11	$	10.46	to	$	9.62	$	114	3.08	%	1.15% to 2.00%	(2.70)	%	to	(3.99)	%
Guggenheim Investments Long Short Equity:
	2019	15	$	9.63	to	$	9.65	$	144	0.61	%	0.75% to 2.00%	4.79	%	to	3.43	%
	2018	21	$	9.19	to	$	9.33	$	203	—%		0.75% to 2.00%	(7.64)	%	to	(14.64)	%
	2017	12	$	11.54	to	$	10.93	$	141	0.36	%	1.00% to 2.00%	15.05	%	to	12.56	%
	2016	12	$	10.40	to	$	9.71	$	127	—%		1.15% to 2.00%	(0.57)	%	to	(1.32)	%
	2015	17	$	10.46	to	$	9.84	$	177	—%		1.15% to 2.00%	0.10	%	to	(2.09)	%
Guggenheim Investments Multi-Hedge Strategies:
	2019	57	$	10.16	to	$	9.45	$	559	2.35	%	0.75% to 2.00%	4.21	%	to	2.94	%
	2018	57	$	9.75	to	$	9.18	$	539	—%		0.75% to 2.00%	(2.11)	%	to	(6.99)	%
	2017	53	$	10.29	to	$	9.87	$	537	—%		1.00% to 2.00%	2.80	%	to	1.65	%
	2016	45	$	10.16	to	$	9.71	$	438	0.11	%	1.15% to 2.00%	(1.65)	%	to	(2.51)	%
	2015	9	$	10.33	to	$	9.96	$	88	0.63	%	1.15% to 2.00%	0.68	%	to	(0.60)	%
International Emerging Markets Class 1:
	2019	1,427	$	4.37	to	$	32.59	$	43,068	0.95	%	0.41% to 2.00%	17.11	%	to	15.28	%
	2018	1,414	$	3.73	to	$	28.27	$	40,999	1.18	%	0.48% to 2.00%	(21.36)	%	to	(22.59)	%
	2017	1,609	$	4.74	to	$	36.52	$	59,753	1.25	%	0.42% to 2.00%	40.25	%	to	38.07	%
	2016	1,820	$	3.38	to	$	26.45	$	49,426	1.16	%	0.40% to 2.00%	8.94	%	to	7.22	%
	2015	1,992	$	3.10	to	$	24.67	$	50,665	1.67	%	0.41% to 2.00%	(14.17)	%	to	(15.51)	%

A-122

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Invesco American Franchise Series I:
	2019	178	$	24.21	to	$	23.12	$	4,306	—%		1.30% to 1.90%	35.03	%	to	34.18	%
	2018	213	$	17.93	to	$	17.23	$	3,826	—%		1.30% to 1.90%	(4.88)	%	to	(5.43)	%
	2017	237	$	18.85	to	$	18.22	$	4,468	0.08	%	1.30% to 1.90%	25.67	%	to	24.97	%
	2016	259	$	15.00	to	$	14.58	$	3,878	—%		1.30% to 1.90%	0.94	%	to	0.34	%
	2015	294	$	14.86	to	$	14.53	$	4,369	—%		1.30% to 1.90%	3.70	%	to	3.05	%
Invesco Balanced-Risk Allocation Series II:
	2019	43	$	10.61	to	$	11.79	$	489	—%		0.75% to 1.40%	13.96	%	to	13.26	%
	2018	30	$	9.31	to	$	10.41	$	310	1.33	%	0.75% to 1.40%	(6.71)	%	to	(7.96)	%
	2017	24	$	10.62	to	$	11.31	$	266	4.11	%	1.00% to 1.40%	6.09	%	to	8.33	%
	2016	19	$	10.50	to	$	10.44	$	203	0.21	%	1.15% to 1.40%	10.18	%	to	9.89	%
	2015	20	$	9.53	to	$	9.50	$	191	4.91	%	1.15% to 1.40%	(5.46)	%	to	(5.75)	%
Invesco Core Equity Series I:
	2019	670	$	20.21	to	$	18.02	$	13,547	0.92	%	1.30% to 1.90%	27.27	%	to	26.54	%
	2018	788	$	15.88	to	$	14.24	$	12,518	0.88	%	1.30% to 1.90%	(10.59)	%	to	(11.11)	%
	2017	944	$	17.76	to	$	16.02	$	16,764	1.02	%	1.30% to 1.90%	11.77	%	to	11.02	%
	2016	1,063	$	15.89	to	$	14.43	$	16,900	0.75	%	1.30% to 1.90%	8.84	%	to	8.17	%
	2015	1,220	$	14.60	to	$	13.34	$	17,820	1.11	%	1.30% to 1.90%	(7.01)	%	to	(7.49)	%
Invesco Health Care Series I:
	2019	264	$	29.84	to	$	14.18	$	7,018	0.04	%	1.30% to 2.00%	30.82	%	to	29.85	%
	2018	312	$	22.81	to	$	10.92	$	6,469	—%		1.30% to 2.00%	(0.39)	%	to	(1.09)	%
	2017	353	$	22.90	to	$	11.04	$	7,458	0.36	%	1.30% to 2.00%	14.33	%	to	13.58	%
	2016	389	$	20.03	to	$	9.72	$	7,477	—%		1.30% to 2.00%	(12.61)	%	to	(2.70)	%
	2015	461	$	22.92	to	$	21.00	$	10,562	—%		1.30% to 1.90%	1.82	%	to	1.25	%
Invesco Health Care Series II:
	2019	213	$	13.37	to	$	13.45	$	2,877	—%		0.75% to 1.40%	31.21	%	to	30.33	%
	2018	127	$	10.19	to	$	10.32	$	1,313	—%		0.75% to 1.40%	1.49	%	to	(0.77)	%
	2017	98	$	10.61	to	$	10.40	$	1,028	0.09	%	1.00% to 1.40%	6.10	%	to	13.91	%
	2016	83	$	9.18	to	$	9.13	$	762	—%		1.15% to 1.40%	(12.74)	%	to	(12.88)	%
	2015	78	$	10.52	to	$	10.48	$	814	—%		1.15% to 1.40%	1.74	%	to	1.45	%

A-123

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Invesco International Growth Series I:
	2019	516	$	13.53	to	$	12.62	$	6,939	1.51	%	1.40% to 2.00%	26.80	%	to	26.07	%
	2018	621	$	10.67	to	$	10.01	$	6,592	2.05	%	1.40% to 2.00%	(16.18)	%	to	(16.65)	%
	2017	752	$	12.73	to	$	12.01	$	9,528	1.41	%	1.40% to 2.00%	21.35	%	to	20.58	%
	2016	906	$	10.49	to	$	9.96	$	9,472	1.38	%	1.40% to 2.00%	(1.87)	%	to	(2.45)	%
	2015	954	$	10.69	to	$	10.21	$	10,161	1.50	%	1.40% to 2.00%	(3.69)	%	to	(4.31)	%
Invesco International Growth Series II:
	2019	149	$	10.94	to	$	11.56	$	1,692	1.37	%	0.75% to 1.40%	27.21	%	to	26.48	%
	2018	94	$	8.60	to	$	9.14	$	861	1.97	%	0.75% to 1.40%	(13.48)	%	to	(16.38)	%
	2017	60	$	11.31	to	$	10.93	$	665	1.39	%	1.00% to 1.40%	13.21	%	to	21.04	%
	2016	46	$	9.08	to	$	9.03	$	418	1.21	%	1.15% to 1.40%	(1.84)	%	to	(2.06)	%
	2015	46	$	9.25	to	$	9.22	$	429	1.81	%	1.15% to 1.40%	(3.75)	%	to	(3.96)	%
Invesco Mid Cap Growth Series I:
	2019	51	$	20.97	to	$	20.03	$	1,079	—%		1.30% to 1.90%	32.55	%	to	31.78	%
	2018	66	$	15.82	to	$	15.20	$	1,042	—%		1.30% to 1.90%	(6.78)	%	to	(7.32)	%
	2017	71	$	16.97	to	$	16.40	$	1,209	—%		1.30% to 1.90%	20.87	%	to	20.15	%
	2016	78	$	14.04	to	$	13.65	$	1,102	—%		1.30% to 1.90%	(0.50)	%	to	(1.16)	%
	2015	113	$	14.11	to	$	13.81	$	1,594	—%		1.30% to 1.90%	(0.14)	%	to	(0.65)	%
Invesco Oppenheimer V.I. Main Street Small Cap Series II:
	2019 (15)	26	$	16.92	to	$	16.26	$	448	—%		1.30% to 1.90%	24.50	%	to	23.74	%
	2018	30	$	13.59	to	$	13.14	$	402	0.06	%	1.30% to 1.90%	(11.70)	%	to	(12.22)	%
	2017	39	$	15.39	to	$	14.97	$	602	0.64	%	1.30% to 1.90%	12.42	%	to	11.80	%
	2016	41	$	13.69	to	$	13.39	$	555	0.25	%	1.30% to 1.90%	16.21	%	to	15.43	%
	2015	48	$	11.78	to	$	11.60	$	561	0.70	%	1.30% to 1.90%	(7.32)	%	to	(7.86)	%
Invesco Small Cap Equity Series I:
	2019	237	$	28.01	to	$	25.38	$	6,548	—%		1.30% to 2.00%	24.93	%	to	24.11	%
	2018	253	$	22.42	to	$	20.45	$	5,591	—%		1.30% to 2.00%	(16.16)	%	to	(16.77)	%
	2017	297	$	26.74	to	$	24.57	$	7,855	—%		1.30% to 2.00%	12.59	%	to	11.78	%
	2016	327	$	23.75	to	$	21.98	$	7,700	—%		1.30% to 2.00%	10.62	%	to	9.85	%
	2015	372	$	21.47	to	$	20.01	$	7,928	—%		1.30% to 2.00%	(6.77)	%	to	(7.40)	%

A-124

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Invesco Technology Series I:
	2019	182	$	16.66	to	$	14.90	$	3,038	—%		1.30% to 1.90%	34.14	%	to	33.27	%
	2018	245	$	12.42	to	$	11.18	$	3,047	—%		1.30% to 1.90%	(1.82)	%	to	(2.27)	%
	2017	292	$	12.65	to	$	11.44	$	3,692	—%		1.30% to 1.90%	33.44	%	to	32.56	%
	2016	284	$	9.48	to	$	8.63	$	2,690	—%		1.30% to 1.90%	(2.07)	%	to	(2.60)	%
	2015	357	$	9.68	to	$	8.86	$	3,452	—%		1.30% to 1.90%	5.45	%	to	4.73	%
Invesco Value Opportunities Series I:
	2019	181	$	18.38	to	$	16.76	$	3,318	0.24	%	1.40% to 2.00%	28.80	%	to	28.04	%
	2018	204	$	14.27	to	$	13.09	$	2,905	0.31	%	1.40% to 2.00%	(20.28)	%	to	(20.76)	%
	2017	247	$	17.90	to	$	16.52	$	4,385	0.39	%	1.40% to 2.00%	15.78	%	to	15.12	%
	2016	297	$	15.46	to	$	14.35	$	4,558	0.41	%	1.40% to 2.00%	16.68	%	to	15.91	%
	2015	338	$	13.25	to	$	12.38	$	4,445	2.63	%	1.40% to 2.00%	(11.67)	%	to	(12.14)	%
Janus Henderson Enterprise Service Shares:
	2019	366	$	27.52	to	$	24.53	$	10,067	0.05	%	1.30% to 1.90%	33.40	%	to	32.59	%
	2018	417	$	20.63	to	$	18.50	$	8,592	0.13	%	1.30% to 1.90%	(1.95)	%	to	(2.53)	%
	2017	465	$	21.04	to	$	18.98	$	9,775	0.52	%	1.30% to 1.90%	25.46	%	to	24.70	%
	2016	519	$	16.77	to	$	15.22	$	8,696	0.71	%	1.30% to 1.90%	10.69	%	to	9.97	%
	2015	580	$	15.15	to	$	13.84	$	8,794	0.76	%	1.30% to 1.90%	2.43	%	to	1.84	%
Janus Henderson Flexible Bond Service Shares:
	2019	290	$	10.90	to	$	10.35	$	3,116	3.03	%	0.75% to 2.00%	8.46	%	to	7.14	%
	2018	188	$	10.05	to	$	9.66	$	1,858	2.64	%	0.75% to 2.00%	0.70	%	to	(3.30)	%
	2017	213	$	10.13	to	$	9.99	$	2,165	2.61	%	1.00% to 2.00%	1.30	%	to	1.32	%
	2016	194	$	10.03	to	$	9.86	$	1,933	3.06	%	1.15% to 2.00%	1.01	%	to	(1.40)	%
	2015	80	$	9.93	to	$	9.90	$	796	2.28	%	1.15% to 1.40%	(1.19)	%	to	(1.39)	%
Janus Henderson Global Technology Service Shares:
	2019 (11)	30	$	11.66	to	$	11.62	$	348	—%		0.75% to 1.40%	16.60	%	to	16.20	%
LargeCap Growth I Class 1:
	2019	3,666	$	4.13	to	$	92.86	$	168,970	0.06	%	0.47% to 2.00%	34.35	%	to	32.24	%
	2018	1,582	$	3.07	to	$	70.22	$	102,803	0.04	%	0.61% to 2.00%	3.16	%	to	1.55	%
	2017	1,778	$	2.98	to	$	69.15	$	112,164	0.03	%	0.42% to 2.00%	33.15	%	to	31.07	%
	2016	1,955	$	2.24	to	$	52.76	$	94,521	—%		0.41% to 2.00%	0.84	%	to	(0.73)	%
	2015	2,158	$	2.22	to	$	53.15	$	105,642	0.23	%	0.45% to 2.00%	7.32	%	to	5.62	%

A-125

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
LargeCap S&P 500 Index Class 1:
	2019	4,496	$	3.34	to	$	22.92	$	99,605	1.84	%	0.51% to 2.00%	30.55	%	to	28.48	%
	2018	5,075	$	2.56	to	$	17.84	$	88,547	1.69	%	0.47% to 2.00%	(4.98)	%	to	(6.45)	%
	2017	5,160	$	2.70	to	$	19.07	$	104,391	1.65	%	0.42% to 2.00%	20.98	%	to	19.11	%
	2016	5,486	$	2.23	to	$	16.01	$	92,870	1.66	%	0.39% to 2.00%	11.12	%	to	9.36	%
	2015	5,945	$	2.01	to	$	14.64	$	92,317	1.44	%	0.48% to 2.00%	0.72	%	to	(0.88)	%
LargeCap S&P 500 Index Class 2:
	2019	1,221	$	12.35	to	$	15.30	$	15,836	2.08	%	0.75% to 1.40%	29.73	%	to	29.01	%
	2018	678	$	9.52	to	$	11.86	$	7,080	1.80	%	0.75% to 1.40%	(4.99)	%	to	(6.25)	%
	2017	275	$	11.40	to	$	12.65	$	3,235	2.08	%	1.00% to 1.40%	13.77	%	to	19.57	%
	2016	72	$	10.63	to	$	10.58	$	766	2.04	%	1.15% to 1.40%	10.04	%	to	9.75	%
	2015 (5)	16	$	9.66	to	$	9.64	$	151	2.15	%	1.15% to 1.40%	(3.69)	%	to	(3.89)	%
MFS International Intrinsic Value Service Class:
	2019 (16)	569	$	11.33	to	$	13.02	$	7,485	1.49	%	0.75% to 2.00%	24.78	%	to	23.06	%
	2018	531	$	9.08	to	$	10.58	$	5,717	0.95	%	0.75% to 2.00%	(8.93)	%	to	(11.46)	%
	2017	548	$	11.76	to	$	11.95	$	6,698	1.47	%	1.00% to 2.00%	17.72	%	to	24.35	%
	2016	336	$	10.61	to	$	9.61	$	3,308	1.38	%	1.15% to 2.00%	2.61	%	to	1.69	%
	2015	160	$	10.34	to	$	9.45	$	1,563	2.01	%	1.15% to 2.00%	5.19	%	to	(5.41)	%
MFS New Discovery Service Class:
	2019	301	$	12.99	to	$	18.06	$	4,807	—%		0.75% to 2.00%	40.13	%	to	38.39	%
	2018	197	$	9.27	to	$	13.05	$	2,463	—%		0.75% to 2.00%	(7.67)	%	to	(3.62)	%
	2017	110	$	12.00	to	$	13.54	$	1,497	—%		1.00% to 2.00%	19.05	%	to	23.77	%
	2016	93	$	9.84	to	$	10.94	$	1,031	—%		1.15% to 2.00%	7.54	%	to	6.73	%
	2015	121	$	9.15	to	$	10.25	$	1,253	—%		1.15% to 2.00%	(9.50)	%	to	(4.12)	%
MFS Utilities Service Class:
	2019	709	$	12.38	to	$	27.00	$	15,284	3.83	%	0.75% to 2.00%	23.92	%	to	22.34	%
	2018	633	$	9.99	to	$	22.07	$	12,388	0.83	%	0.75% to 2.00%	(0.10)	%	to	(1.21)	%
	2017	643	$	10.57	to	$	22.34	$	13,276	4.13	%	1.00% to 2.00%	5.38	%	to	12.26	%
	2016	626	$	9.08	to	$	19.90	$	11,829	3.68	%	1.15% to 2.00%	9.93	%	to	9.04	%
	2015	626	$	8.26	to	$	18.25	$	10,898	4.07	%	1.15% to 2.00%	(15.71)	%	to	(16.48)	%

A-126

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
MFS Value Service Class:
	2019	170	$	31.25	to	$	29.32	$	5,292	1.89	%	1.40% to 2.00%	27.71	%	to	26.93	%
	2018	192	$	24.47	to	$	23.10	$	4,681	1.28	%	1.40% to 2.00%	(11.60)	%	to	(12.13)	%
	2017	226	$	27.68	to	$	26.29	$	6,239	1.70	%	1.40% to 2.00%	15.72	%	to	15.05	%
	2016	243	$	23.92	to	$	22.85	$	5,780	1.80	%	1.40% to 2.00%	12.20	%	to	11.52	%
	2015	244	$	21.32	to	$	20.49	$	5,168	2.12	%	1.40% to 2.00%	(2.34)	%	to	(2.89)	%
MidCap Class 1:
	2019	2,908	$	17.45	to	$	127.60	$	338,480	0.27	%	0.42% to 2.00%	42.50	%	to	40.27	%
	2018	3,361	$	12.25	to	$	90.97	$	283,507	0.28	%	0.45% to 2.00%	(6.94)	%	to	(8.41)	%
	2017	3,871	$	13.16	to	$	99.32	$	351,847	0.54	%	0.43% to 2.00%	24.99	%	to	23.04	%
	2016	4,359	$	10.53	to	$	80.72	$	324,263	0.41	%	0.40% to 2.00%	9.91	%	to	8.17	%
	2015	4,922	$	9.58	to	$	74.62	$	339,892	0.51	%	0.48% to 2.00%	1.22	%	to	(0.36)	%
Neuberger Berman AMT Mid Cap Growth Portfolio Class S:
	2019	252	$	12.02	to	$	14.21	$	3,506	—%		0.75% to 2.00%	31.51	%	to	29.89	%
	2018	223	$	9.14	to	$	10.94	$	2,453	—%		0.75% to 2.00%	(9.05)	%	to	(8.45)	%
	2017	215	$	11.77	to	$	11.95	$	2,599	—%		1.00% to 2.00%	17.00	%	to	22.19	%
	2016	249	$	9.46	to	$	9.78	$	2,448	—%		1.15% to 2.00%	2.94	%	to	2.09	%
	2015 (5)	286	$	9.19	to	$	9.58	$	2,746	—%		1.15% to 2.00%	(8.83)	%	to	(4.49)	%
Neuberger Berman AMT Sustainable Equity Class I:
	2019	220	$	30.28	to	$	27.61	$	6,634	0.45	%	1.40% to 2.00%	24.10	%	to	23.37	%
	2018	132	$	24.40	to	$	22.38	$	3,205	0.46	%	1.40% to 2.00%	(7.01)	%	to	(7.60)	%
	2017	167	$	26.24	to	$	24.22	$	4,355	0.50	%	1.40% to 2.00%	16.78	%	to	16.11	%
	2016	204	$	22.47	to	$	20.86	$	4,563	0.67	%	1.40% to 2.00%	8.34	%	to	7.69	%
	2015	246	$	20.74	to	$	19.37	$	5,077	0.55	%	1.40% to 2.00%	(1.85)	%	to	(2.47)	%
Neuberger Berman AMT Sustainable Equity Class S:
	2019	1	$	11.05	to	$	10.94	$	16	0.77	%	0.75% to 1.40%	24.58	%	to	23.76	%
	2018 (10)	—	$	8.87	to	$	8.84	$	2	0.97	%	0.75% to 1.40%	(11.48)	%	to	(11.78)	%
PIMCO All Asset Administrative Class:
	2019	147	$	16.56	to	$	15.54	$	2,419	2.89	%	1.40% to 2.00%	10.33	%	to	9.67	%
	2018	184	$	15.01	to	$	14.17	$	2,747	3.13	%	1.40% to 2.00%	(6.71)	%	to	(7.26)	%
	2017	230	$	16.09	to	$	15.28	$	3,688	4.55	%	1.40% to 2.00%	11.97	%	to	11.29	%
	2016	268	$	14.37	to	$	13.73	$	3,838	2.58	%	1.40% to 2.00%	11.31	%	to	10.73	%
	2015	322	$	12.91	to	$	12.40	$	4,147	3.26	%	1.40% to 2.00%	(10.22)	%	to	(10.79)	%

A-127

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
PIMCO All Asset Advisor Class:
	2019	10	$	10.41	to	$	11.19	$	112	2.83	%	0.75% to 1.40%	10.86	%	to	10.14	%
	2018	10	$	9.39	to	$	10.16	$	100	3.11	%	0.75% to 1.40%	(5.72)	%	to	(6.70)	%
	2017	9	$	10.71	to	$	10.89	$	98	5.25	%	1.00% to 1.40%	7.21	%	to	11.81	%
	2016	5	$	9.78	to	$	9.74	$	53	6.46	%	1.15% to 1.40%	11.52	%	to	11.31	%
	2015 (5)	—	$	8.77	to	$	8.75	$	—	—%		1.15% to 1.40%	(12.12)	%	to	(12.32)	%
PIMCO Commodity Real Return Strategy M Class:
	2019	6	$	9.23	to	$	7.59	$	51	4.14	%	0.75% to 1.40%	10.14	%	to	9.52	%
	2018	5	$	8.38	to	$	6.93	$	44	1.32	%	0.75% to 1.40%	(15.86)	%	to	(15.59)	%
	2017	1	$	10.24	to	$	8.21	$	11	11.10	%	1.00% to 1.40%	2.40	%	to	0.49	%
	2016	1	$	8.20	to	$	8.17	$	12	0.93	%	1.15% to 1.40%	13.26	%	to	13.16	%
	2015 (5)	2	$	7.24	to	$	7.22	$	13	—%		1.15% to 1.40%	(27.45)	%	to	(27.66)	%
PIMCO High Yield Administrative Class:
	2019	1,297	$	11.13	to	$	16.03	$	19,995	4.92	%	0.75% to 2.00%	13.92	%	to	12.41	%
	2018	1,264	$	9.77	to	$	14.26	$	17,923	5.11	%	0.75% to 2.00%	(2.20)	%	to	(4.55)	%
	2017	1,441	$	10.34	to	$	14.94	$	21,731	4.86	%	1.00% to 2.00%	3.40	%	to	4.48	%
	2016	1,457	$	10.68	to	$	14.30	$	21,316	5.15	%	1.15% to 2.00%	11.13	%	to	10.25	%
	2015	1,190	$	9.61	to	$	12.97	$	15,656	5.25	%	1.15% to 2.00%	(2.73)	%	to	(3.57)	%
PIMCO Low Duration Advisor Class:
	2019	149	$	10.35	to	$	9.70	$	1,526	2.58	%	0.75% to 2.00%	3.19	%	to	1.89	%
	2018	105	$	10.03	to	$	9.52	$	1,029	1.79	%	0.75% to 2.00%	0.40	%	to	(1.75)	%
	2017	40	$	10.00	to	$	9.69	$	392	1.22	%	1.00% to 2.00%	—	%	to	(0.82)	%
	2016	32	$	9.90	to	$	9.77	$	315	1.41	%	1.15% to 2.00%	0.10	%	to	(0.71)	%
	2015 (5)	37	$	9.89	to	$	9.84	$	361	11.09	%	1.15% to 2.00%	(1.10)	%	to	(1.60)	%
PIMCO Total Return Administrative Class:
	2019	1,771	$	10.87	to	$	12.80	$	22,921	2.99	%	0.75% to 2.00%	7.62	%	to	6.22	%
	2018	1,741	$	10.10	to	$	12.05	$	21,623	2.54	%	0.75% to 2.00%	1.30	%	to	(2.51)	%
	2017	2,027	$	10.22	to	$	12.36	$	26,016	2.02	%	1.00% to 2.00%	2.20	%	to	2.83	%
	2016	2,081	$	10.19	to	$	12.02	$	25,990	2.08	%	1.15% to 2.00%	1.49	%	to	0.67	%
	2015	2,192	$	10.04	to	$	11.94	$	27,067	4.91	%	1.15% to 2.00%	(0.69)	%	to	(1.57)	%

A-128

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Principal Capital Appreciation Class 1:
	2019	4,601	$	27.08	to	$	23.93	$	97,427	1.56	%	0.95% to 2.00%	31.27	%	to	29.91	%
	2018	5,616	$	20.63	to	$	18.42	$	91,429	1.13	%	0.95% to 2.00%	(4.36)	%	to	(5.34)	%
	2017	6,546	$	21.57	to	$	19.46	$	112,554	1.25	%	0.95% to 2.00%	19.63	%	to	18.37	%
	2016	7,551	$	18.03	to	$	16.44	$	109,609	1.12	%	0.95% to 2.00%	8.09	%	to	6.96	%
	2015	8,683	$	16.68	to	$	15.37	$	116,745	0.32	%	0.95% to 2.00%	1.21	%	to	0.13	%
Principal Capital Appreciation Class 2:
	2019	397	$	12.67	to	$	16.36	$	5,278	1.55	%	0.75% to 1.40%	31.16	%	to	30.25	%
	2018	201	$	9.66	to	$	12.56	$	2,144	1.04	%	0.75% to 1.40%	(3.69)	%	to	(4.92)	%
	2017	82	$	11.38	to	$	13.21	$	999	1.27	%	1.00% to 1.40%	13.57	%	to	18.79	%
	2016	39	$	11.19	to	$	11.12	$	432	1.17	%	1.15% to 1.40%	7.60	%	to	7.34	%
	2015	61	$	10.40	to	$	10.36	$	632	0.05	%	1.15% to 1.40%	0.78	%	to	0.48	%
Principal LifeTime 2010 Class 1:
	2019	935	$	16.41	to	$	16.55	$	16,850	2.80	%	0.95% to 2.00%	13.02	%	to	11.82	%
	2018	1,096	$	14.52	to	$	14.80	$	17,559	2.90	%	0.95% to 2.00%	(4.79)	%	to	(5.79)	%
	2017	1,437	$	15.25	to	$	15.71	$	24,297	2.18	%	0.95% to 2.00%	10.43	%	to	9.25	%
	2016	1,749	$	13.81	to	$	14.38	$	26,898	2.11	%	0.95% to 2.00%	4.23	%	to	3.16	%
	2015	1,925	$	13.25	to	$	13.94	$	28,521	2.18	%	0.95% to 2.00%	(2.14)	%	to	(3.13)	%
Principal LifeTime 2020 Class 1:
	2019	4,012	$	10.72	to	$	19.22	$	82,586	2.41	%	0.75% to 2.00%	6.56	%	to	15.78	%
	2018	4,619	$	15.81	to	$	16.60	$	83,004	2.65	%	0.95% to 2.00%	(6.28)	%	to	(7.31)	%
	2017	5,445	$	16.87	to	$	17.91	$	104,894	1.94	%	0.95% to 2.00%	13.91	%	to	12.71	%
	2016	6,348	$	14.81	to	$	15.89	$	107,765	1.93	%	0.95% to 2.00%	4.74	%	to	3.72	%
	2015	7,249	$	14.14	to	$	15.32	$	117,718	2.54	%	0.95% to 2.00%	(2.01)	%	to	(3.10)	%
Principal LifeTime 2030 Class 1:
	2019	2,724	$	10.91	to	$	20.19	$	57,570	2.05	%	0.75% to 2.00%	8.13	%	to	19.61	%
	2018	2,985	$	16.08	to	$	16.88	$	54,595	2.32	%	0.95% to 2.00%	(7.90)	%	to	(8.95)	%
	2017	3,430	$	17.46	to	$	18.54	$	68,465	1.55	%	0.95% to 2.00%	17.10	%	to	15.95	%
	2016	3,830	$	14.91	to	$	15.99	$	64,965	1.63	%	0.95% to 2.00%	4.85	%	to	3.76	%
	2015	4,235	$	14.22	to	$	15.41	$	68,802	2.56	%	0.95% to 2.00%	(2.00)	%	to	(3.02)	%

A-129

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Principal LifeTime 2040 Class 1:
	2019	705	$	11.04	to	$	21.69	$	15,574	1.87	%	0.75% to 2.00%	9.42	%	to	22.27	%
	2018	676	$	16.60	to	$	17.74	$	12,970	2.06	%	0.95% to 2.00%	(8.69)	%	to	(9.67)	%
	2017	718	$	18.18	to	$	19.64	$	15,164	1.32	%	0.95% to 2.00%	19.53	%	to	18.24	%
	2016	782	$	15.21	to	$	16.61	$	13,886	1.47	%	0.95% to 2.00%	4.46	%	to	3.36	%
	2015	804	$	14.56	to	$	16.07	$	13,719	2.40	%	0.95% to 2.00%	(1.82)	%	to	(2.78)	%
Principal LifeTime 2050 Class 1:
	2019	549	$	11.11	to	$	22.22	$	11,861	1.99	%	0.75% to 2.00%	10.00	%	to	23.86	%
	2018	500	$	16.71	to	$	17.94	$	9,720	2.07	%	0.95% to 2.00%	(9.48)	%	to	(10.43)	%
	2017	523	$	18.46	to	$	20.03	$	11,287	1.27	%	0.95% to 2.00%	20.97	%	to	19.73	%
	2016	516	$	15.26	to	$	16.73	$	9,242	1.32	%	0.95% to 2.00%	4.59	%	to	3.46	%
	2015	520	$	14.59	to	$	16.17	$	8,937	2.52	%	0.95% to 2.00%	(1.62)	%	to	(2.65)	%
Principal LifeTime Strategic Income Class 1:
	2019	662	$	14.96	to	$	14.68	$	10,633	2.38	%	0.95% to 2.00%	11.39	%	to	10.21	%
	2018	788	$	13.43	to	$	13.32	$	11,401	2.59	%	0.95% to 2.00%	(3.93)	%	to	(4.93)	%
	2017	1,004	$	13.98	to	$	14.01	$	15,184	2.32	%	0.95% to 2.00%	7.79	%	to	6.62	%
	2016	1,144	$	12.97	to	$	13.14	$	16,092	2.46	%	0.95% to 2.00%	3.76	%	to	2.74	%
	2015	1,254	$	12.50	to	$	12.79	$	17,075	2.13	%	0.95% to 2.00%	(1.88)	%	to	(2.96)	%
Real Estate Securities Class 1:
	2019	978	$	7.21	to	$	65.35	$	67,480	1.78	%	0.45% to 2.00%	30.71	%	to	28.67	%
	2018	1,138	$	5.51	to	$	50.79	$	61,500	1.80	%	0.39% to 2.00%	(4.62)	%	to	(6.12)	%
	2017	1,312	$	5.78	to	$	54.10	$	75,318	1.74	%	0.41% to 2.00%	8.74	%	to	7.02	%
	2016	1,456	$	5.32	to	$	50.55	$	77,554	1.38	%	0.42% to 2.00%	5.40	%	to	3.76	%
	2015	1,589	$	5.04	to	$	48.72	$	81,337	1.51	%	0.46% to 2.00%	3.77	%	to	2.14	%
Real Estate Securities Class 2:
	2019	441	$	12.94	to	$	15.87	$	6,106	1.68	%	0.75% to 1.40%	29.92	%	to	29.13	%
	2018	295	$	9.96	to	$	12.29	$	3,271	1.72	%	0.75% to 1.40%	(1.39)	%	to	(5.82)	%
	2017	206	$	10.62	to	$	13.05	$	2,537	1.35	%	1.00% to 1.40%	5.67	%	to	7.41	%
	2016	325	$	12.21	to	$	12.15	$	3,951	1.02	%	1.15% to 1.40%	4.27	%	to	4.11	%
	2015	148	$	11.71	to	$	11.67	$	1,733	1.89	%	1.15% to 1.40%	2.81	%	to	2.55	%

A-130

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
Rydex Basic Materials:
	2019	53	$	10.32	to	$	11.60	$	606	—%		0.75% to 1.40%	20.42	%	to	19.71	%
	2018	52	$	8.57	to	$	9.69	$	490	0.56	%	0.75% to 1.40%	(14.04)	%	to	(18.57)	%
	2017	37	$	11.36	to	$	11.90	$	440	0.69	%	1.00% to 1.40%	12.92	%	to	19.72	%
	2016	34	$	9.98	to	$	9.94	$	340	—%		1.15% to 1.40%	29.44	%	to	29.09	%
	2015 (5)	—	$	7.71	to	$	7.70	$	—	—%		1.15% to 1.40%	(22.75)	%	to	(22.85)	%
Rydex Commodities Strategy:
	2019	68	$	9.04	to	$	6.67	$	499	1.54	%	0.75% to 2.00%	14.43	%	to	13.05	%
	2018	66	$	7.90	to	$	5.90	$	424	3.51	%	0.75% to 2.00%	(20.36)	%	to	(16.78)	%
	2017	44	$	10.89	to	$	7.09	$	271	—%		1.00% to 2.00%	8.04	%	to	2.31	%
	2016	46	$	5.06	to	$	6.93	$	270	—%		1.15% to 2.00%	9.29	%	to	8.28	%
	2015	13	$	4.63	to	$	6.40	$	77	—%		1.15% to 2.00%	(34.60)	%	to	(35.81)	%
Rydex NASDAQ 100:
	2019	201	$	12.88	to	$	19.37	$	3,095	0.12	%	0.75% to 1.40%	35.86	%	to	34.98	%
	2018	153	$	9.48	to	$	14.35	$	1,825	—%		0.75% to 1.40%	(6.32)	%	to	(3.17)	%
	2017	103	$	11.69	to	$	14.82	$	1,359	—%		1.00% to 1.40%	16.90	%	to	29.32	%
	2016	51	$	11.53	to	$	11.46	$	581	—%		1.15% to 1.40%	4.82	%	to	4.47	%
	2015	59	$	11.00	to	$	10.97	$	646	—%		1.15% to 1.40%	7.00	%	to	6.71	%
SAM Balanced Portfolio Class 1:
	2019	23,734	$	2.75	to	$	16.85	$	427,977	2.43	%	0.39% to 2.00%	19.50	%	to	17.59	%
	2018	28,289	$	2.30	to	$	14.33	$	432,209	3.06	%	0.75% to 2.00%	(5.44)	%	to	(6.89)	%
	2017	32,925	$	2.44	to	$	15.39	$	536,023	2.11	%	0.41% to 2.00%	14.73	%	to	12.91	%
	2016	37,771	$	2.12	to	$	13.63	$	541,175	2.10	%	0.42% to 2.00%	6.38	%	to	4.69	%
	2015	44,023	$	2.00	to	$	13.02	$	598,643	2.90	%	0.42% to 2.00%	(1.23)	%	to	(2.76)	%
SAM Balanced Portfolio Class 2:
	2019	1,918	$	11.26	to	$	12.86	$	22,821	2.44	%	0.75% to 1.40%	18.78	%	to	18.09	%
	2018	1,266	$	9.48	to	$	10.89	$	13,097	3.13	%	0.75% to 1.40%	(5.11)	%	to	(6.60)	%
	2017	807	$	10.96	to	$	11.66	$	9,147	2.05	%	1.00% to 1.40%	9.38	%	to	13.31	%
	2016	354	$	10.35	to	$	10.29	$	3,651	2.15	%	1.15% to 1.40%	5.40	%	to	5.11	%
	2015	383	$	9.82	to	$	9.79	$	3,759	3.22	%	1.15% to 1.40%	(2.19)	%	to	(2.39)	%

A-131

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
SAM Conservative Balanced Portfolio Class 1:
	2019	6,014	$	17.84	to	$	15.77	$	102,122	2.77	%	0.95% to 2.00%	14.73	%	to	13.62	%
	2018	6,934	$	15.55	to	$	13.88	$	102,968	3.31	%	0.95% to 2.00%	(4.37)	%	to	(5.45)	%
	2017	8,225	$	16.26	to	$	14.68	$	128,349	2.70	%	0.95% to 2.00%	10.39	%	to	9.31	%
	2016	9,706	$	14.73	to	$	13.43	$	137,720	2.52	%	0.95% to 2.00%	5.36	%	to	4.27	%
	2015	11,177	$	13.98	to	$	12.88	$	150,875	3.19	%	0.95% to 2.00%	(1.69)	%	to	(2.79)	%
SAM Conservative Balanced Portfolio Class 2:
	2019	774	$	11.07	to	$	12.16	$	8,928	2.86	%	0.75% to 1.40%	14.83	%	to	14.07	%
	2018	584	$	9.64	to	$	10.66	$	6,004	3.25	%	0.75% to 1.40%	(3.50)	%	to	(5.16)	%
	2017	473	$	10.69	to	$	11.24	$	5,204	2.97	%	1.00% to 1.40%	6.79	%	to	9.66	%
	2016	299	$	10.31	to	$	10.25	$	3,074	2.30	%	1.15% to 1.40%	4.88	%	to	4.59	%
	2015	306	$	9.83	to	$	9.80	$	3,002	3.57	%	1.15% to 1.40%	(2.09)	%	to	(2.29)	%
SAM Conservative Growth Portfolio Class 1:
	2019	4,770	$	19.72	to	$	17.42	$	89,362	1.80	%	0.95% to 2.00%	22.87	%	to	21.56	%
	2018	5,607	$	16.05	to	$	14.33	$	85,786	2.71	%	0.95% to 2.00%	(7.49)	%	to	(8.49)	%
	2017	6,430	$	17.35	to	$	15.66	$	106,720	1.54	%	0.95% to 2.00%	18.67	%	to	17.48	%
	2016	7,042	$	14.62	to	$	13.33	$	98,936	1.43	%	0.95% to 2.00%	5.94	%	to	4.88	%
	2015	7,589	$	13.80	to	$	12.71	$	100,958	2.27	%	0.95% to 2.00%	(1.99)	%	to	(3.05)	%
SAM Conservative Growth Portfolio Class 2:
	2019	1,278	$	11.40	to	$	13.58	$	15,671	1.68	%	0.75% to 1.40%	22.71	%	to	21.90	%
	2018	1,015	$	9.29	to	$	11.14	$	10,749	2.78	%	0.75% to 1.40%	(7.01)	%	to	(8.09)	%
	2017	707	$	11.28	to	$	12.12	$	8,479	1.46	%	1.00% to 1.40%	12.57	%	to	17.78	%
	2016	562	$	10.35	to	$	10.29	$	5,813	1.16	%	1.15% to 1.40%	5.61	%	to	5.32	%
	2015	564	$	9.80	to	$	9.77	$	5,522	2.62	%	1.15% to 1.40%	(2.49)	%	to	(2.79)	%
SAM Flexible Income Portfolio Class 1:
	2019	7,363	$	17.36	to	$	15.34	$	121,789	3.41	%	0.95% to 2.00%	12.14	%	to	11.00	%
	2018	8,584	$	15.48	to	$	13.82	$	126,847	3.95	%	0.95% to 2.00%	(2.89)	%	to	(3.89)	%
	2017	10,450	$	15.94	to	$	14.38	$	159,705	3.30	%	0.95% to 2.00%	7.41	%	to	6.28	%
	2016	11,503	$	14.84	to	$	13.53	$	164,166	3.29	%	0.95% to 2.00%	6.00	%	to	4.88	%
	2015	12,622	$	14.00	to	$	12.90	$	170,645	3.57	%	0.95% to 2.00%	(2.23)	%	to	(3.23)	%

A-132

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
SAM Flexible Income Portfolio Class 2:
	2019	1,491	$	11.02	to	$	11.73	$	16,833	3.49	%	0.75% to 1.40%	12.11	%	to	11.40	%
	2018	1,231	$	9.83	to	$	10.53	$	12,512	3.98	%	0.75% to 1.40%	(1.50)	%	to	(3.57)	%
	2017	757	$	10.47	to	$	10.92	$	8,096	3.56	%	1.00% to 1.40%	4.60	%	to	6.64	%
	2016	419	$	10.30	to	$	10.24	$	4,297	3.02	%	1.15% to 1.40%	5.53	%	to	5.24	%
	2015	454	$	9.76	to	$	9.73	$	4,421	4.01	%	1.15% to 1.40%	(2.69)	%	to	(2.89)	%
SAM Strategic Growth Portfolio Class 1:
	2019	2,858	$	19.97	to	$	17.64	$	53,900	1.47	%	0.95% to 2.00%	26.23	%	to	24.93	%
	2018	3,391	$	15.82	to	$	14.12	$	50,949	2.32	%	0.95% to 2.00%	(9.44)	%	to	(10.46)	%
	2017	3,988	$	17.47	to	$	15.77	$	66,383	1.41	%	0.95% to 2.00%	21.07	%	to	19.83	%
	2016	4,536	$	14.43	to	$	13.16	$	62,693	1.44	%	0.95% to 2.00%	5.10	%	to	4.03	%
	2015	5,064	$	13.73	to	$	12.65	$	66,773	2.26	%	0.95% to 2.00%	(2.49)	%	to	(3.58)	%
SAM Strategic Growth Portfolio Class 2:
	2019	773	$	11.47	to	$	13.80	$	9,818	1.41	%	0.75% to 1.40%	26.18	%	to	25.34	%
	2018	573	$	9.09	to	$	11.01	$	6,019	2.32	%	0.75% to 1.40%	(9.10)	%	to	(10.12)	%
	2017	425	$	11.44	to	$	12.25	$	5,078	1.34	%	1.00% to 1.40%	14.17	%	to	20.22	%
	2016	265	$	10.25	to	$	10.19	$	2,708	1.10	%	1.15% to 1.40%	4.70	%	to	4.41	%
	2015	169	$	9.79	to	$	9.76	$	1,650	2.36	%	1.15% to 1.40%	(2.97)	%	to	(3.17)	%
Short-Term Income Class 1:
	2019	5,889	$	10.14	to	$	11.27	$	70,427	2.66	%	0.75% to 2.00%	1.40	%	to	2.64	%
	2018	6,315	$	12.25	to	$	10.98	$	73,768	2.12	%	0.85% to 2.00%	0.16	%	to	(0.99)	%
	2017	7,454	$	12.23	to	$	11.09	$	87,366	1.92	%	0.85% to 2.00%	1.58	%	to	0.36	%
	2016	8,582	$	12.04	to	$	11.05	$	99,558	2.09	%	0.85% to 2.00%	1.26	%	to	0.09	%
	2015	9,431	$	11.89	to	$	11.04	$	108,512	2.61	%	0.85% to 2.00%	(0.17)	%	to	(1.25)	%
SmallCap Class 1:
	2019	3,367	$	3.20	to	$	25.86	$	94,321	0.32	%	0.43% to 2.00%	26.87	%	to	24.87	%
	2018	3,888	$	2.52	to	$	20.71	$	86,881	0.30	%	0.56% to 2.00%	(11.27)	%	to	(12.65)	%
	2017	4,394	$	2.84	to	$	23.71	$	112,085	0.37	%	0.41% to 2.00%	12.40	%	to	10.64	%
	2016	5,080	$	2.53	to	$	21.43	$	116,092	0.25	%	0.37% to 2.00%	16.90	%	to	15.09	%
	2015	5,906	$	2.16	to	$	18.62	$	116,459	0.08	%	0.55% to 2.00%	(0.50)	%	to	(2.10)	%

A-133

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value											Total return (3)
			corresponding									Expense		corresponding
			to lowest					Net		Investment		ratio (2)		to lowest
		Units	to highest					assets		income		lowest to		to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest		expense ratio
SmallCap Class 2:
	2019	210	$	10.86	to	$	12.84	$	2,452	0.09	%	0.75% to 1.40%		26.13	%	to	25.39	%
	2018	133	$	8.61	to	$	10.24	$	1,292	0.09	%	0.75% to 1.40%		(14.16)	%	to	(12.48)	%
	2017	88	$	11.12	to	$	11.70	$	1,014	0.15	%	1.00% to 1.40%		10.10	%	to	11.01	%
	2016	82	$	10.58	to	$	10.54	$	871	0.09	%	1.15% to 1.40%		15.75	%	to	15.57	%
	2015 (4)	86	$	9.14	to	$	9.12	$	785	0.09	%	1.15% to 1.40%		(7.21)	%	to	(7.41)	%
T. Rowe Price Blue Chip Growth Portfolio II:
	2019	751	$	11.18	to	$	37.15	$	25,129	—%		0.75% to 2.00%		9.93	%	to	27.01	%
	2018	664	$	31.89	to	$	29.25	$	20,946	—%		1.40% to 2.00%		0.25	%	to	(0.37)	%
	2017	685	$	31.81	to	$	29.36	$	21,628	—%		1.40% to 2.00%		33.94	%	to	33.15	%
	2016	701	$	23.75	to	$	22.05	$	16,507	—%		1.40% to 2.00%		(0.88)	%	to	(1.47)	%
	2015	715	$	23.96	to	$	22.38	$	16,984	—%		1.40% to 2.00%		9.26	%	to	8.59	%
T. Rowe Price Health Sciences Portfolio II:
	2019	384	$	68.59	to	$	62.54	$	26,161	—%		1.40% to 2.00%		26.85	%	to	26.06	%
	2018	467	$	54.07	to	$	49.61	$	25,079	—%		1.40% to 2.00%		(0.55)	%	to	(1.14)	%
	2017	524	$	54.37	to	$	50.18	$	28,307	—%		1.40% to 2.00%		25.54	%	to	24.79	%
	2016	580	$	43.31	to	$	40.21	$	24,918	—%		1.40% to 2.00%		(11.95)	%	to	(12.49)	%
	2015	725	$	49.19	to	$	45.95	$	35,403	—%		1.40% to 2.00%		10.89	%	to	10.24	%
Templeton Global Bond VIP Class 4:
	2019	528	$	10.02	to	$	9.37	$	5,136	6.90	%	0.75% to 2.00%		1.11	%	to	(0.11)	%
	2018	468	$	9.91	to	$	9.38	$	4,505	—%		0.75% to 2.00%		(1.10)	%	to	(0.11)	%
	2017	213	$	9.70	to	$	9.39	$	2,026	—%		1.00% to 2.00%		(3.10)	%	to	(0.32)	%
	2016	126	$	9.37	to	$	9.42	$	1,185	—%		1.15% to 2.00%		1.63	%	to	0.86	%
	2015	116	$	9.22	to	$	9.34	$	1,072	6.23	%	1.15% to 2.00%		(5.44)	%	to	(6.60)	%
Templeton Growth VIP Class 2:
	2019	27				$	24.13	$	661	2.81	%	0.85	%				14.14	%
	2018	35				$	21.14	$	737	2.00	%	0.85	%				(15.54)	%
	2017	36				$	25.03	$	891	1.61	%	0.85	%				17.46	%
	2016	40				$	21.31	$	854	2.01	%	0.85	%				8.72	%
	2015	44				$	19.60	$	869	2.66	%	0.85	%				(7.28)	%

A-134

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

		December 31,								For the year ended December 31, except as noted
			Unit fair value										Total return (3)
			corresponding									Expense	corresponding
			to lowest					Net		Investment		ratio (2)	to lowest
		Units	to highest					assets		income		lowest to	to highest
Division		(000's)	expense ratio					(000's)		ratio (1)		highest	expense ratio
The Merger Fund:
	2019	27	$	10.98	to	$	10.88	$	304	1.23	%	0.75% to 1.40%	5.37	%	to	4.62	%
	2018	17	$	10.42	to	$	10.40	$	180	1.19	%	0.75% to 1.40%	4.41	%	to	5.58	%
	2017	1	$	10.07	to	$	9.85	$	6	—%		1.00% to 1.40%	0.60	%	to	1.23	%
	2016	—	$	9.77	to	$	9.73	$	—	—%		1.15% to 1.40%	1.24	%	to	0.93	%
	2015 (5)	—	$	9.65	to	$	9.64	$	—	—%		1.15% to 1.40%	(3.50)	%	to	(3.60)	%
TOPS Aggressive Growth ETF Portfolio Investor Class:
	2019	59	$	10.66	to	$	10.45	$	624	2.32	%	0.75% to 2.00%	23.24	%	to	21.65	%
	2018 (10)	2	$	8.65	to	$	8.59	$	20	1.89	%	0.75% to 2.00%	(13.67)	%	to	(14.27)	%
TOPS Balanced ETF Portfolio Investor Class:
	2019	95	$	10.71	to	$	10.50	$	1,017	2.16	%	0.75% to 2.00%	14.91	%	to	13.39	%
	2018 (10)	3	$	9.32	to	$	9.26	$	26	3.21	%	0.75% to 2.00%	(6.89)	%	to	(7.49)	%
TOPS Conservative ETF Portfolio Investor Class:
	2019	28	$	10.67	to	$	10.46	$	295	0.04	%	0.75% to 2.00%	10.57	%	to	9.19	%
	2018 (10)	—	$	9.65	to	$	9.58	$	—	—%		0.75% to 2.00%	(3.50)	%	to	(4.20)	%
TOPS Growth ETF Portfolio Investor Class:
	2019	98	$	10.68	to	$	10.48	$	1,044	1.49	%	0.75% to 2.00%	20.81	%	to	19.36	%
	2018 (10)	4	$	8.84	to	$	8.78	$	34	1.18	%	0.75% to 2.00%	(11.78)	%	to	(12.38)	%
TOPS Moderate Growth ETF Portfolio Investor Class:
	2019	22	$	10.77	to	$	10.56	$	237	1.29	%	0.75% to 2.00%	17.58	%	to	16.17	%
	2018 (10)	1	$	9.16	to	$	9.09	$	11	—%		0.75% to 2.00%	(8.49)	%	to	(9.19)	%
VanEck Global Hard Assets Class S:
	2019	484	$	7.84	to	$	7.91	$	3,957	—%		0.75% to 2.00%	10.73	%	to	9.25	%
	2018	523	$	7.08	to	$	7.24	$	3,896	—%		0.75% to 2.00%	(28.92)	%	to	(29.84)	%
	2017	550	$	10.05	to	$	10.32	$	5,838	—%		1.00% to 2.00%	(0.59)	%	to	(3.82)	%
	2016	730	$	7.08	to	$	10.73	$	8,017	0.37	%	1.15% to 2.00%	41.60	%	to	40.45	%
	2015	665	$	5.00	to	$	7.64	$	5,127	0.03	%	1.15% to 2.00%	(34.30)	%	to	(34.92)	%

(1) These amounts represent the dividends, excluding distributions of capital gains, received by the division from the underlying mutual fund, net of management fees assessed by the fund manager, divided by the average net assets. These ratios exclude those expenses, such as mortality and expense charges, that result in direct reductions in the unit values. The recognition of investment income by the division is affected by the timing of the declaration of dividends by the underlying fund in which the divisions invest. These ratios are annualized for periods less than one year.

A-135

Principal Life Insurance Company

Separate Account B

Notes to Financial Statements

December 31, 2019

(2)	These ratios represent the annualized contract expenses of the separate account, consisting primarily of mortality and expense charges, for each period indicated. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contractholder accounts through the redemption of units and expenses of the underlying fund are excluded.
(3)	These amounts represent the total return for the periods indicated, including changes in the value of the underlying fund, and reflect deductions for all items included in the expense ratio. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Investment options with a date notation indicate the effective date of that investment option in the variable account. For purposes of the total return calculation the beginning unit value is typically equal to an investment option with a similar expense structure and if no such similar investment option exists, a beginning unit value of ten would typically be used. The total return is calculated for the period indicated or from the effective date through the end of the reporting period. Total returns have not been annualized for periods less than one year. These percentages represent the range of total returns available as of the report date and correspond with the expense ratio lowest to highest.
(4)	Commenced operations April 17, 2015. Investment income ratios have been annualized for the year ended December 31, 2015.
(5)	Commenced operations May 18, 2015. Investment income ratios have been annualized for the year ended December 31, 2015.
(6)	Commenced operations February 8, 2016. Investment income ratios have been annualized for the year ended December 31, 2016.
(7)	Commenced operations May 23, 2016. Investment income ratios have been annualized for the year ended December 31, 2016.
(8)	Commenced operations April 6, 2017. Investment income ratios have been annualized for the year ended December 31, 2017.
(9)	Commenced operations May 26, 2017. Investment income ratios have been annualized for the year ended December 31, 2017.
(10)	Commenced operations June 11, 2018. Investment income ratios have been annualized for the year ended December 31, 2018.
(11)	Commenced operations June 7, 2019. Investment income ratios have been annualized for the year ended December 31, 2019.
(12)	Represented the operations of BlackRock iShares Dynamic Allocation Class III Division until June 6, 2019.
(13)	Represented the operations of Dreyfus IP MidCap Stock Service Shares Division until June 2, 2019.
(14)	Represented the operations of Dreyfus IP Technology Growth Service Shares Division until June 2, 2019.
(15)	Represented the operations of Oppenheimer Main Street Small Cap Service Shares Division until May 24, 2019.
(16)	Represented the operations of MFS International Value Service Class Division until June 6, 2019.

Following is a list of divisions and corresponding unit values and total return for divisions that had unit values and/or total return outside those corresponding to the lowest to highest expense ratio indicated above for applicable years.

Division	2019 Unit Value ($)
Alps/Red Rocks Listed Private Equity Class III	14.16
American Century VP Inflation Protection Class II	10.19, 10.35, 10.48, 10.51 and 13.65
American Century VP Value Class II	28.75
American Funds Insurance Series Asset Allocation Fund Class 4	13.50
American Funds Insurance Series Blue Chip Income and Growth    Fund Class 4	14.25
Division	2019 Unit Value ($)
American Funds Insurance Series Global Small Capitalization    Fund Class 4	13.94
American Funds Insurance Series Managed Risk Asset    Allocation Fund Class P2	12.79
American Funds Insurance Series Managed Risk Growth Fund    Class P2	14.57
American Funds Insurance Series Managed Risk International    Fund Class P2	10.94 and 12.15
American Funds Insurance Series New World Fund Class 2	12.07 and 12.77
American Funds Insurance Series New World Fund Class 4	12.30 and 12.61
BlackRock Advantage U.S. Total Market Class III	14.50
BlackRock Global Allocation Class III	11.02, 11.28, 11.33, 11.41 and 11.55
BlackRock 60/40 Target Allocation Class III	11.81, 12.09, 12.15, 12.23 and 12.39
BNY Mellon IP MidCap Stock Service Shares	11.86
Calvert EAFE International Index Class F	11.16 and 11.82
Calvert Russell 2000 Small Cap Index Class F	14.24
Calvert S&P MidCap 400 Index Class F	14.44
ClearBridge Small Cap Growth Series II	15.46
Columbia Small Cap Value Class 2	13.02
Core Plus Bond Class 1	3.08, 23.36, 26.03 and 26.20
Diversified Balanced Class 2	11.91
Diversified Balanced Managed Volatility Class 2	12.88 and 13.29
Diversified Growth Class 2	20.30
Diversified Growth Managed Volatility Class 2	14.01
Diversified International Class 1	3.87, 29.64, 33.02 and 33.24
DWS Equity 500 Index Class B2	16.29
DWS Small Mid Cap Value Class B	13.51, 13.97 and 14.06
Equity Income Class 1	3.18, 11.87, 11.94, 11.99, 12.01 and 12.02
Equity Income Class 2	15.75
Fidelity VIP Contrafund Service Class 2	34.38
Fidelity VIP Government Money Market Initial Class	0.99, 1.02, 9.71, 9.91, 9.94, 10.08 and 10.12
Fidelity VIP Government Money Market Service Class 2	9.81
Fidelity VIP Mid Cap Service Class 2	33.69
Fidelity VIP Overseas Service Class 2	20.66
Franklin Global Real Estate VIP Class 2	11.96, 12.53 and 12.70
Franklin Rising Dividends VIP Class 4	16.07
Goldman Sachs VIT Mid Cap Value Service Class S	12.88
Goldman Sachs VIT Small Cap Equity Insights Service Class S	15.18
Government & High Quality Bond Class 1	2.88, 11.92, 12.74, 13.21, 13.36 and 12.66
Guggenheim Floating Rate Strategies Series F	10.76, 11.01, 11.06, 11.18 and 11.33
Guggenheim Investments Global Managed Futures Strategy	10.23
Guggenheim Investments Long Short Equity	9.70, 9.92, 9.97, 10.40, 10.47 and 10.61
International Emerging Markets Class 1	32.80, 36.55 and 36.78
Invesco Balanced-Risk Allocation Series II	11.94
Invesco Health Care Series II	13.63 and 13.83
Division	2019 Unit Value ($)
Invesco International Growth Series II	11.71 and 12.06
LargeCap Growth I Class 1	93.46, 104.14 and 104.81
LargeCap S&P 500 Index Class 1	23.07, 25.71, 25.87, 28.19 and 28.30
LargeCap S&P 500 Index Class 2	15.48
MFS International Intrinsic Value Service Class	13.08, 13.09, 13.39, 13.45, 14.55 and 14.75
MFS New Discovery Service Class	18.18, 18.80 and 18.92
MFS Utilities Service Class	28.78
MidCap Class 1	16.51, 128.42, 143.10 and 144.02
Neuberger Berman AMT Mid-Cap Growth Portfolio S Class	14.28 and 14.57
PIMCO All Asset Advisor Class	11.32
PIMCO Commodity Real Return Strategy M Class	9.55
PIMCO High Yield Administrative Class	17.03
PIMCO Total Return Administrative Class	10.80 and 13.65
Principal Capital Appreciation Class 1	15.21 and 15.64
Principal Capital Appreciation Class 2	16.57
Principal LifeTime Strategic Income Class 1	16.09 and 16.20
Principal LifeTime 2010 Class 1	16.66, 18.14 and 18.26
Principal LifeTime 2020 Class 1	10.68, 10.70, 10.71, 19.35, 21.08 and 21.21
Principal LifeTime 2030 Class 1	10.87, 10.89, 10.90, 20.32, 22.14 and 22.28
Principal LifeTime 2040 Class 1	11.00, 11.02, 11.03, 21.83, 23.79 and 23.94
Principal LifeTime 2050 Class 1	11.07, 11.09, 11.10, 22.37, 24.37 and 24.52
Real Estate Securities Class 1	65.77, 73.29 and 73.76
Real Estate Securities Class 2	16.08
Rydex Basic Materials	11.74
Rydex Commodities Strategy	4.92, 4.99 and 10.44
Rydex NASDAQ 100	19.63
SAM Balanced Portfolio Class 1	16.96, 18.18, 18.30 and 19.07
SAM Balanced Portfolio Class 2	13.03
SAM Conservative Balanced Portfolio Class 2	12.32
SAM Conservative Growth Portfolio Class 2	13.76
SAM Flexible Income Portfolio Class 2	11.89
SAM Strategic Growth Portfolio Class 2	13.99
Short-Term Income Class 1	10.11, 10.12, 10.13, 11.34, 12.12, 12.57, 12.71 and 12.04
SmallCap Class 1	26.02, 29.00, 29.19 and 38.91
SmallCap Class 2	12.99
T. Rowe Price Blue Chip Growth Portfolio II	11.14, 11.15, 11.16 and 40.74
The Merger Fund	11.01 and 11.22
VanEck Global Hard Assets Class S	5.28, 5.35, 7.96, 8.43 and 8.49
Division	2019 Total Return (%)
Columbia Limited Duration Credit Class 2	5.39
Core Plus Bond Class 1	2.69, 2.89, 2.99, and 3.09
Diversified Balanced Class 2	16.65
Diversified Growth Class 2	19.55
Diversified Income Class 2	13.57
Diversified International Class 1	8.79, 8.89, 8.99 and 9.19
Equity Income Class 1	28.55
Fidelity VIP Government Money Market Service Class 2	0.31
Government & High Quality Bond Class 1	1.60, 1.80, 1.90 and 2.00
International Emerging Markets Class 1	11.21, 11.31, 11.41 and 11.61
LargeCap Growth I Class 1	12.50, 12.60, 12.70 and 12.89
Principal LifeTime 2020 Class 1	6.16, 6.36, 6.46, 15.94, 16.46, 16.54 and 17.01
Principal LifeTime 2030 Class 1	7.84, 7.93, 8.03, 19.67, 20.33, 20.43 and 20.83
Principal LifeTime 2040 Class 1	9.02, 9.22, 9.32, 22.37, 23.01, 23.15 and 23.55
Principal LifeTime 2050 Class 1	9.60, 9.80, 9.90, 24.07, 24.65, 24.72 and 25.13
Short-Term Income Class 1	1.10, 1.20, 1.30, 2.72, 3.32, 3.71, 3.76 and 3.17
T. Rowe Price Blue Chip Growth Portfolio II	9.54, 9.64, 9.73 and 27.75
TOPS Growth ETF Portfolio Investor Class	19.34
Division	2018 Unit Value ($)
Alps/Red Rocks Listed Private Equity Class III	10.24
American Century VP Inflation Protection Class II	9.54, 9.63, 9.74, 9.75 and 12.71
American Century VP Value Class II	22.94
American Funds Insurance Series Asset Allocation Fund Class 4	11.29
American Funds Insurance Series Blue Chip Income and Growth    Class 4	11.91
American Funds Insurance Series Global Small Capitalization    Fund Class 4	10.74
American Funds Insurance Series Managed Risk Asset    Allocation Fund Class P2	10.96
American Funds Insurance Series Managed Risk Growth Fund    Class P2	12.11
American Funds Insurance Series Managed Risk International    Fund Class P2	9.40 and 10.43
American Funds Insurance Series New World Fund Class 2	9.53 and 10.02
American Funds Insurance Series New World Fund Class 4	9.66 and 9.89
BlackRock Advantage U.S. Total Market Class III	11.40
BlackRock Global Allocation Class III	9.54, 9.72, 9.75, 9.80 and 9.91
BlackRock iShares Dynamic Allocation Class III	9.93, 10.11, 10.15, 10.21 and 10.32
Calvert EAFE International Index Class F	9.33 and 9.86
Calvert Russell 2000 Small Cap Index Class F	11.54
Calvert S&P MidCap 400 Index Class F	11.63
ClearBridge Small Cap Growth Class II	12.36
Columbia Small Cap Value Class 2	10.89
Division	2018 Unit Value ($)
Core Plus Bond Class 1	2.83, 21.68, 24.04 and 24.17
Core Plus Bond Class 2	10.04
Diversified Balanced Class 2	15.53
Diversified Balanced Managed Volatility Class 2	11.47
Diversified Growth Class 2	16.98
Diversified Growth Managed Volatility Class 2	11.82
Diversified Income Class 2	12.53
Diversified International Class 1	3.17, 24.62, 27.30 and 27.45
Diversified International Class 2	9.43 and 9.63
Dreyfus IP MidCap Stock Service Shares	10.01
DWS Equity 500 Index Class B2	12.61
DWS Small Mid Cap Value Class B	11.38, 11.71 and 11.77
Equity Income Class 1	2.47, 9.33, 9.34, 9.35 and 9.39
Equity Income Class 2	12.37
Fidelity VIP Contrafund Service Class 2	26.56
Fidelity VIP Government Money Market Initial Class	0.98, 9.70, 9.85, 9.87, 9.98 and 10.00
Fidelity VIP Government Money Market Service Class 2	9.85 and 9.78
Fidelity VIP Mid Cap Service Class 2	27.74
Fidelity VIP Overseas Service Class 2	16.43
Franklin Global Real Estate VIP Class 2	9.50, 9.54, 9.87, 10.39 and 10.50
Franklin Rising Dividends VIP Class 4	12.59
Goldman Sachs VIT Mid Cap Value Service Shares	9.93
Goldman Sachs VIT Small Cap Equity Insights Service Shares	12.33
Government & High Quality Bond Class 1	2.73, 11.41, 12.06, 12.12, 12.53 and 12.66
Government & High Quality Bond Class 2	9.96
Guggenheim Floating Rate Strategies Series F	10.19, 10.38, 10.42, 10.54 and 10.65
Guggenheim Investments Global Managed Futures Strategy	9.55
Guggenheim Investments Long Short Equity	9.36, 9.53, 9.57, 9.95, 10.06 and 10.17
Guggenheim Investments Multi-Hedge Strategies	9.77
Income Class 2	10.42
International Emerging Markets Class 1	28.42, 31.51 and 31.68
International Emerging Markets Class 2	9.09, 9.61
Invesco Balanced-Risk Allocation Series II	10.52
Invesco Health Care Series II	10.43, 10.57
Invesco International Growth Series II	9.24, 9.50
LargeCap Growth Class 1	3.85, 31.03, 34.41 and 34.59
LargeCap Growth Class 2	11.91
LargeCap Growth I Class 1	70.60, 78.28 and 78.70
LargeCap Growth I Class 2	13.45
LargeCap S&P 500 Index Class 1	17.93, 19.88, 19.99, 21.69 and 21.79
LargeCap S&P 500 Index Class 2	11.97
MFS International Value Service Class	10.61, 10.81, 10.85, 11.75, and 11.87
MFS New Discovery Service Class	13.12, 13.49 and 13.57
MFS Utilities Service Class	23.38
Division	2018 Unit Value ($)
MidCap Class 1	94.46, 101.41 and 101.96
Multi-Asset Income Class 2	10.68
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	11.15
PIMCO All Asset Advisor Class	10.25
PIMCO Commodity Real Return Strategy M Class	8.69
PIMCO High Yield Administrative Class	15.05
PIMCO Total Return Administrative Class	10.06 and 12.77
Principal Capital Appreciation Class 1	11.70 and 11.96
Principal Capital Appreciation Class 2	12.69
Principal LifeTime 2010 Class 1	14.88, 16.13 and 16.21
Principal LifeTime 2020 Class 1	16.69, 18.10 and 18.20
Principal LifeTime 2020 Class 2	10.37
Principal LifeTime 2030 Class 1	16.98, 18.40 and 18.50
Principal LifeTime 2030 Class 2	10.42
Principal LifeTime 2040 Class 1	17.84, 19.34 and 19.44
Principal LifeTime 2040 Class 2	10.48
Principal LifeTime 2050 Class 1	18.03, 19.55 and 19.66
Principal LifeTime 2050 Class 2	10.51
Principal LifeTime Strategic Income Class 1	14.51 and 14.59
Real Estate Securities Class 1	51.07, 56.62 and 56.93
Real Estate Securities Class 2	12.42
Rydex Basic Materials	9.78
Rydex Commodities Strategy	4.33, 4.38 and 9.15
Rydex NASDAQ 100	14.51
SAM Balanced Portfolio Class 1	14.40, 15.37, 15.45 and 16.04
SAM Balanced Portfolio Class 2	11.01
SAM Conservative Balanced Portfolio Class 2	10.78
SAM Conservative Growth Portfolio Class 2	11.26
SAM Flexible Income Portfolio Class 2	10.64
SAM Strategic Growth Portfolio Class 2	11.13
Short-Term Income Class 2	10.10
SmallCap Class 1	20.82, 23.08, 23.21 and 30.80
SmallCap Class 2	10.34
The Merger Fund	10.49 and 10.67
VanEck Global Hard Assets Class S	4.80, 4.86, 7.28, 7.67 and 7.71
Division	2018 Total Return (%)
American Funds Insurance Series Global Small Capitalization    Fund Class 4	(11.89) and (11.65)
American Funds Insurance Series Managed Risk Growth Fund    Class P2	(1.46) and (1.39)
Calvert Russell 2000 Small Cap Index Class F	(12.44) and (12.35)
ClearBridge Small Cap Growth Class II	1.98 and 2.18
Division	2018 Total Return (%)
Diversified Growth Class 2	(5.860)
Diversified Income Class 2	(3.700)
Fidelity VIP Contrafund Service Class 2	(7.96,) (7.94), (7.74) and (7.54)
Fidelity VIP Mid Cap Service Class 2	(15.81) and (15.67)
Goldman Sachs VIT Small Cap Equity Insights Service Shares	(9.87) and (9.74)
Guggenheim Floating Rate Strategies Series F	(2.17), (2.14), (2.07), (1.93) and (1.77)
LargeCap Growth Class 2	(8.60) and (8.44)
LargeCap Growth I Class 2	2.13 and 2.31
MFS New Discovery Service Class	(3.53), (3.11), (3.09), (3.00), (2.85) and (2.67)
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	(7.86), (7.85), (7.64) and (7.48)
PIMCO Commodity Real Return Strategy M Class	(15.25) and (15.14)
Rydex Commodities Strategy	(16.74), (16.41), (16.37), (16.20), (16.09) and (15.98)
Rydex NASDAQ 100	(2.88) and (2.82)
SmallCap Class 2	(12.15) and (12.05)
Templeton Global Bond VIP Class 4	0.43, 0.52, 0.74, 0.82 and 0.00
The Merger Fund	5.85 and 5.96
Division	2017 Unit Value ($)
Alps/Red Rocks Listed Private Equity Class III	11.84
American Century VP Inflation Protection Class II	10.00, 10.05 and 13.27
American Century VP Value Class II	25.62
American Funds Insurance Series Asset Allocation Fund Class 4	12.00
American Funds Insurance Series Blue Chip Income and Growth    Class 4	13.22
American Funds Insurance Series Global Small Capitalization    Fund Class 4	12.19
American Funds Insurance Series Managed Risk Asset    Allocation Fund Class P2	11.66
American Funds Insurance Series Managed Risk Growth Fund    Class P2	12.29
American Funds Insurance Series New World Fund Class 2	11.29 and 11.83
BlackRock Advantage U.S. Total Market Class III	12.36
BlackRock iShares Alternative Strategies Class III	10.64, 10.78, 10.81 and 10.85
Calvert Russell 2000 Small Cap Index Class F	13.18
Calvert S&P MidCap 400 Index Class F	13.31
ClearBridge Small Cap Growth Class II	12.12
Columbia Small Cap Value Class 2	13.46
Core Plus Bond Class 1	2.89, 22.42, 24.73 and 24.84
Core Plus Bond Class 2	10.32
Deutsche Equity 500 Index Class B2	13.43
Deutsche Small Mid Cap Value Class B	13.86, 14.19 and 14.25
Diversified Balanced Class 2	16.30
Diversified Balanced Managed Volatility Class 2	10.68 and 12.02
Diversified Growth Class 2	18.04
Division	2017 Unit Value ($)
Diversified Growth Managed Volatility Class 2	10.86 and 12.50
Diversified Income Class 2	13.02
Diversified International Class 1	3.87
Dreyfus IP MidCap Stock Service Shares	12.01
Equity Income Class 1	18.15, 19.30 and 19.38
Equity Income Class 2	13.21
Fidelity VIP Contrafund Service Class 2	28.85
Fidelity VIP Government Money Market Initial Class	0.98, 1.00, 9.73, 9.82, 9.84, 9.91 and 9.93
Fidelity VIP Government Money Market Service Class 2	9.78 and 9.83
Fidelity VIP Mid Cap Service Class 2	33.00
Fidelity VIP Overseas Service Class 2	10.71, 10.88, 11.50, 11.59 and 19.62
Franklin Global Real Estate VIP Class 2	11.30 and 11.39
Franklin Rising Dividends VIP Class 4	13.43
Goldman Sachs VIT Mid Cap Value Service Shares	11.25
Goldman Sachs VIT Small Cap Equity Insights Service Shares	13.68
Government & High Quality Bond Class 1	2.72, 11.53, 12.12, 12.17, 12.54 and 12.65
Government & High Quality Bond Class 2	10.15
Guggenheim Floating Rate Strategies Series F	10.47, 10.61, 10.64, 10.77 and 10.86
Guggenheim Investments Long Short Equity	11.72 and 11.81
Guggenheim Investments Multi-Hedge Strategies	10.33 and 10.42
Income Class 2	10.49
International Emerging Markets Class 1	36.68, 40.47 and 40.65
Invesco Balanced-Risk Allocation Series II	11.41
Janus Henderson Flexible Bond Service Shares	10.17 and 10.25
LargeCap Growth Class 1	4.18, 34.12, 37.64 and 37.81
LargeCap Growth Class 2	13.03
LargeCap Growth I Class 1	69.46, 76.63 and 76.97
LargeCap Growth I Class 2	13.17
LargeCap S&P 500 Index Class 1	19.16, 21.13, 21.23, 22.92 and 23.06
LargeCap S&P 500 Index Class 2	12.73
LargeCap Value Class 1	6.17,43.22, 47.68, 47.89 and 64.98
LargeCap Value Class 2	11.77
MFS International Value Service Class	11.98, 12.14, 12.17, 13.19 and 13.30
MFS New Discovery Service Class	13.60, 13.92 and 13.99
MFS Utilities Service Class	10.20, 10.28 and 23.52
MidCap Class 1	12.50, 99.76, 110.05 and 110.54
Multi-Asset Income Class 2	11.49
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	11.58, 11.65 and 12.10
PIMCO All Asset Advisor Class	10.97
PIMCO High Yield Administrative Class	15.68
PIMCO Total Return Administrative Class	13.02
Principal Capital Appreciation Class 1	12.34 and 12.55
Principal Capital Appreciation Class 2	13.32
Principal LifeTime 2010 Class 1	15.78, 17.01 and 17.09
Division	2017 Unit Value ($)
Principal LifeTime 2020 Class 1	17.99, 19.40 and 19.49
Principal LifeTime 2020 Class 2	11.12
Principal LifeTime 2030 Class 1	18.62, 20.08 and 20.17
Principal LifeTime 2030 Class 2	11.37
Principal LifeTime 2040 Class 1	19.73, 21.28 and 21.38
Principal LifeTime 2040 Class 2	11.54
Principal LifeTime 2050 Class 1	20.12, 21.70 and 21.80
Principal LifeTime 2050 Class 2	11.67
Principal LifeTime Strategic Income Class 1	14.07, 15.17 and 15.24
Real Estate Securities Class 1	54.34, 59.95 and 60.22
Real Estate Securities Class 2	13.16
Rydex Basic Materials	11.98
Rydex Commodities Strategy	5.18 and 5.22
Rydex NASDAQ 100	14.94
SAM Balanced Portfolio Class 1	15.46, 16.41,16.48 and 17.06
SAM Balanced Portfolio Class 2	11.75
SAM Conservative Balanced Portfolio Class 2	11.33
SAM Conservative Growth Portfolio Class 2	12.22
SAM Flexible Income Portfolio Class 2	11.01
SAM Strategic Growth Portfolio Class 2	12.35
Short-Term Income Class 2	10.10
SmallCap Class 1	23.81, 26.27, 26.39 and 34.86
SmallCap Class 2	11.77
Templeton Global Bond VIP Class 4	9.35
VanEck Global Hard Assets Class S	6.81, 6.86, 10.36, 10.86 and 10.91
Division	2017 Total Return (%)
Alps/Red Rocks Listed Private Equity Class III	23.46
American Century VP Inflation Protection Class II	1.73, 2.23, 2.24, 2.32 and 2.53
American Century VP Value Class II	7.03, 7.15 and 7.34
American Funds Insurance Series Asset Allocation Fund Class 4	14.50
American Funds Insurance Series Blue Chip Income and Growth    Class 4	15.36
American Funds Insurance Series Global Small Capitalization    Fund Class 4	24.26
American Funds Insurance Series Managed Risk Asset    Allocation Fund Class P2	13.42
American Funds Insurance Series Managed Risk Growth Fund    Class P2	24.52
American Funds Insurance Series Managed Risk International    Fund Class P2	27.15
American Funds Insurance Series New World Fund Class 4	27.55
BlackRock Global Allocation Class III	11.56, 12.09, 12.29 and 12.36
BlackRock iShares Alternative Strategies Class III	10.37, 10.91, 10.99 and 11.17
Division	2017 Total Return (%)
BlackRock iShares Dynamic Allocation Class III	12.66, 13.18, 13.26 and 13.44
BlackRock iShares Dynamic Fixed Income Class III	2.13, 2.22 and 2.42
BlackRock iShares Equity Appreciation Class III	19.28, 19.87, 20.06 and 20.24
Calvert EAFE International Index Class F	23.03
Calvert Russell 2000 Small Cap Index Class F	12.75
Calvert S&P MidCap 400 Index Class F	14.35
ClearBridge Small Cap Growth Class II	22.55
Columbia Limited Duration Credit Class 2	0.40, 0.50 and 0.60
Core Plus Bond Class 2	3.30
Delaware Limited Term Diversified Income Service Class	0.51, 0.61 and 0.81
Deutsche Alternative Asset Allocation Class B	5.84
Deutsche Equity 500 Index Class B2	19.70
Deutsche Small Mid Cap Value Class B	8.03, 8.60, 8.65, 8.70 and 8.82
Diversified Balanced Class 2	9.91
Diversified Balanced Managed Volatility Class 2	6.59, 8.86, 9.37, 9.42, 9.46 and 9.65
Diversified Growth Class 2	12.61
Diversified Growth Managed Volatility Class 2	8.38, 11.30, 11.78, 11.81, 11.87 and 12.00
Diversified Income Class 2	7.34
Diversified International Class 2	27.30
Dreyfus IP MidCap Stock Service Shares	13.73
Equity Income Class 2	19.44
Fidelity VIP Contrafund Service Class 2	19.83, 19.91 and 20.19
Fidelity VIP Government Money Market Service Class 2	(1.01) and (0.71)
Fidelity VIP Mid Cap Service Class 2	18.83, 18.87 and 19.22
Fidelity VIP Overseas Service Class 2	27.50, 28.21, 28.24, 28.30 and 28.49
Franklin Global Real Estate VIP Class 2	8.40, 8.96, 8.97, 9.04 and 9.20
Franklin Rising Dividends VIP Class 4	19.06
Goldman Sachs VIT Mid Cap Value Service Shares	9.65
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio    Service Shares	4.21
Government & High Quality Bond Class 2	0.40
Guggenheim Floating Rate Strategies Series F	1.99, 2.02, 2.11 and 2.26
Guggenheim Investments Global Managed Futures Strategy	7.18, 7.26, 7.27 and 7.37
Income Class 2	3.66
International Emerging Markets Class 2	38.88
Invesco Balanced-Risk Allocation Series II	8.67
Invesco Global Health Care Series II	14.27
Invesco International Growth Series II	21.37
Janus Henderson Flexible Bond Service Shares	1.42, 1.90, 1.92, 2.02 and 2.19
LargeCap Growth Class 2	32.96
LargeCap Growth I Class 2	31.83
LargeCap S&P 500 Index Class 2	19.76
LargeCap Value Class 2	15.17
MFS International Value Service Class	24.40, 25.02, 25.03, 25.21 and 25.35
Division	2017 Total Return (%)
MFS New Discovery Service Class	23.97, 24.51, 24.59, 24.80 and 24.90
MFS Utilities Service Class	12.86, 12.96 and 13.22
Multi-Asset Income Class 2	10.59
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	22.80, 22.84 and 23.15
PIMCO All Asset Advisor Class	12.17
PIMCO High Yield Administrative Class	5.16, 5.18 and 5.43
PIMCO Low Duration Advisor Class	0.10
PIMCO Total Return Administrative Class	3.46, 3.50 and 3.73
Principal Capital Appreciation Class 2	19.03
Principal LifeTime 2020 Class 2	13.35
Principal LifeTime 2030 Class 2	16.62
Principal LifeTime 2040 Class 2	19.09
Principal LifeTime 2050 Class 2	20.56
Real Estate Securities Class 2	7.78
Rydex Basic Materials	20.04
Rydex NASDAQ 100	29.58
SAM Balanced Portfolio Class 2	13.53
SAM Conservative Balanced Portfolio Class 2	9.89
SAM Conservative Growth Portfolio Class 2	18.07
SAM Flexible Income Portfolio Class 2	6.89
SAM Strategic Growth Portfolio Class 2	20.49
Short-Term Income Class 2	0.70
SmallCap Class 2	11.25
Templeton Global Bond VIP Class 4	(0.11), 0.32, 0.42 and 0.64
The Merger Fund	1.43
Division	2016 Unit Value ($)
American Century VP Inflation Protection Class II	9.83 and 12.98
American Century VP Value Class II	11.38 and 23.91
American Funds Insurance Series New World Fund Class 2	8.89 and 9.27
Balanced Class 1	3.31 and 29.48
Core Plus Bond Class 1	21.80, 23.93 and 24.01
Deutsche Small Mid Cap Value Class B	11.16, 12.83, 13.06 and 13.11
Diversified Balanced Managed Volatility Class 2	10.05, 10.15, 10.51 and 10.99
Diversified Growth Managed Volatility Class 2	10.09, 10.19, 10.61 and 11.18
Diversified International Class 1	24.03, 26.38 and 26.47
Equity Income Class 1	15.27, 16.16 and 16.22
Fidelity VIP Contrafund Service Class 2	10.69 and 24.06
Fidelity VIP Government Money Market Initial Class	9.84, 9.85, 9.89, 9.90, 9.93 and 9.94
Fidelity VIP Mid Cap Service Class 2	10.76 and 27.77
Fidelity VIP Overseas Service Class 2	8.40, 8.48, 8.97 and 15.30
Government & High Quality Bond Class 1	2.69, 11.53, 12.06, 12.10, 12.42 and 12.52
International Emerging Markets Class 1	26.54, 29.14 and 29.24
Division	2016 Unit Value ($)
LargeCap Growth Class 1	3.12, 25.78, 28.30 and 28.39
LargeCap Growth I Class 1	52.94, 58.11 and 58.31
LargeCap S&P 500 Index Class 1	16.07, 17.64, 17.70, 19.03 and 19.16
LargeCap Value Class 1	5.32, 5.61, 10.10, 12.24, 16.48 and 18.05
MFS New Discovery Service Class	9.80, 10.97, 11.18 and 11.21
MFS Utilities Service Class	9.03 and 20.84
MidCap Class 1	81.00, 88.91 and 89.22
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	9.43 and 9.85
PIMCO High Yield Administrative Class	10.62 and 14.91
PIMCO Total Return Administrative Class	10.13 and 12.58
Principal Capital Appreciation Class 1	10.42 and 10.53
Principal LifeTime 2010 Class 1	14.43, 15.49 and 15.54
Principal LifeTime 2020 Class 1	15.94, 17.11 and 17.16
Principal LifeTime 2030 Class 1	16.05, 17.22 and 17.28
Principal LifeTime 2040 Class 1	16.66, 17.88 and 17.94
Principal LifeTime 2050 Class 1	16.79, 18.02 and 18.08
Principal LifeTime Strategic Income Class 1	13.18, 14.15 and 14.20
Real Estate Securities Class 1	50.72, 55.68 and 55.87
Rydex Commodities Strategy	5.03, 6.94, 7.00 and 7.01
SAM Balanced Portfolio Class 1	13.68, 14.45, 14.50 and 14.95
SmallCap Class 1	21.50, 23.60, 23.68 and 31.15
Templeton Global Bond VIP Class 4	9.32, 9.43, 9.51 and 9.53
VanEck Global Hard Assets Class S	7.04, 10.77, 11.24 and 11.28
Division	2016 Total Return (%)
American Funds Insurance Series New World Fund Class 2	3.25
BlackRock iShares Dynamic Allocation Class III	4.06
BlackRock iShares Equity Appreciation Class III	6.95
Fidelity VIP Government Money Market Initial Class	(1.60), (1.50), (1.10), (1.00), (0.70) and (0.60)
Invesco Global Health Care Series I	(13.14) and (2.30)
LargeCap Value Class 1	0.39
MFS New Discovery Service Class	6.71
Rydex Commodities Strategy	8.27
Division	2015 Unit Value ($)
American Century VP Inflation Protection Class II	9.55 and 12.61
American Century VP Value Class II	9.59 and 20.14
American Funds Insurance Series New World Fund Class 2	8.61 and 8.93
Balanced Class 1	3.15 and 28.26
Bond & Mortgage Securities Class 1	2.68, 21.34, 23.31 and 23.37
Deutsche Small Mid Cap Value Class B	9.72,11.22, 11.38 and 11.40
Diversified Balanced Managed Volatility Class 2	9.63, 9.66, 10.02 and 10.47
Division	2015 Unit Value ($)
Diversified Growth Managed Volatility Class 2	9.56, 9.60, 10.00 and 10.54
Diversified International Class 1	3.03, 24.40, 26.65 and 26.72
Equity Income Class 1	13.45, 14.16 and 14.20
Fidelity VIP Contrafund Service Class 2	10.06 and 22.65
Fidelity VIP Mid Cap Service Class 2	9.75 and 25.16
Fidelity VIP Overseas Service Class 2	9.03, 9.07, 9.60 and 16.38
Government & High Quality Bond Class 1	2.66, 11.54, 12.02, 12.05, 12.32 and 12.41
International Emerging Markets Class 1	24.73, 27.01 and 27.08
LargeCap Growth Class 1	3.31, 27.69, 30.25 and 30.32
LargeCap Growth I Class 1	53.28, 58.20 and 58.34
LargeCap S&P 500 Index Class 1	14.68, 16.03, 16.07, 17.20 and 17.33
LargeCap Value Class 1	4.95, 35.52, 38.80 and 38.89
MFS VIT New Discovery Service Class	9.13, 10.28, 10.42 and 10.44
MFS VIT Utilities Service Class	8.23 and 19.00
MidCap Class 1	9.14, 74.80, 81.70 and 81.89
Money Market Class 1	1.58, 12.12, 13.23 and 13.27
Neuberger Berman AMT Mid Cap Growth Portfolio Class S	9.18 and 9.59
PIMCO High Yield Administrative Class	9.58 and 13.44
PIMCO Total Return Administrative Class	10.00 and 12.43
Principal Capital Appreciation Class 1	9.73 and 9.77
Principal LifeTime 2010 Class 1	13.97, 14.92 and 14.96
Principal LifeTime 2020 Class 1	15.36, 16.40 and 16.44
Principal LifeTime 2030 Class 1	15.45, 16.50 and 16.54
Principal LifeTime 2040 Class 1	16.10, 17.20 and 17.24
Principal LifeTime 2050 Class 1	16.21, 17.31 and 17.35
Principal LifeTime Strategic Income Class 1	12.82, 13.69 and 13.73
Real Estate Securities Class 1	48.84, 53.34 and 53.47
Rydex Commodities Strategy	4.62, 6.41 and 6.43
SAM Balanced Portfolio Class 1	13.05, 13.71, 13.75 and 14.13
SmallCap Blend Class 1	18.67, 20.39, 20.44 and 26.76
Templeton Global Bond VIP Class 4	9.19, 9.35, 9.37 and 9.38
Van Eck Global Hard Assets Service Class	4.98, 7.65, 7.95 and 7.97
Division	2015 Total Return (%)
American Century VP Inflation Protection Class II	(3.310)
Diversified Balanced Managed Volatility Class 2	(3.60) and (3.30)
Diversified Growth Managed Volatility Class 2	(4.50) and (4.10)
Fidelity VIP Overseas Service Class 2	(9.43) and (9.03)
LargeCap Value Class 1	(1.570)
MFS VIT New Discovery Service Class	(9.69), (4.01), (3.52) and (3.42)
Neuberger Berman AMT Mid Cap Growth Portfolio Class	(8.93) and (4.39)
Principal Capital Appreciation Class 1	(1.72) and (1.31)

7. Subsequent Events

The Separate Account performed an evaluation of subsequent events through March 27, 2020. 

The outbreak of the novel coronavirus (“COVID-19”) in many countries continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets. The global impact of the outbreak has been rapidly evolving and many countries have reacted by instituting quarantines and restrictions on travel. Such measures, as well as the general uncertainty surrounding the dangers and impact of COVID-19, are creating significant disruption in supply chains and economic activity.  As COVID-19 continues to spread, the potential impacts, including a global, regional or other economic recession, are increasingly difficult to assess. These events, or fear of such an event, present material uncertainty and risk with respect to the Separate Account performance and financial results.

A-136

APPENDIX B - Principal Life Insurance Company Financials

B-1

Report of Independent Auditors

The Board of Directors and Stockholders

Principal Life Insurance Company

We have audited the accompanying consolidated financial statements of Principal Life Insurance Company, which comprise the consolidated statements of financial position as of December 31, 2019 and 2018, and the related statements of operations, comprehensive income, stockholder’s equity and cash flows for each of the three years in the period ended December 31, 2019, and the related notes to the consolidated financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in conformity with U.S. generally accepted accounting principles; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion.An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Principal Life Insurance Company at December 31, 2019 and 2018, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles.

Required Supplementary Information

Accounting principles generally accepted in the United States require that the Claims Development and Claim Duration and Payout information presented as unaudited within the Short-Duration Contracts disclosure on pages 55-59 be presented to supplement the financial statements. Such information, although not a part of the financial statements, is required by the Financial Accounting Standards Board who considers it to be an essential part of financial reporting for placing the financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the financial statements, and other knowledge we obtained during our audit of the financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

/s/ Ernst & Young LLP

Des Moines, Iowa

March 13, 2020

B-2

Principal Life Insurance Company
Consolidated Statements of Financial Position
		December 31, 2019		December 31, 2018
		(in millions)
Assets
Fixed maturities, available-for-sale (2019 and 2018 include $99.4 million and $94.5 million related to
	consolidated variable interest entities)	$	65,983.4	$	56,275.3
Fixed maturities, trading			237.6		165.5
Equity securities			69.9		84.8
Mortgage loans			15,820.3		14,662.2
Real estate (2019 and 2018 include $457.6 million and $364.0 million related to consolidated variable
	interest entities)		1,713.5		1,726.3
Policy loans			742.2		755.9
Other investments (2019 and 2018 include $19.9 million and $44.1 million related to consolidated variable
	interest entities and $22.8 million and $23.6 million measured at fair value under the fair value option)		2,133.2		1,752.5
	Total investments		86,700.1		75,422.5
Cash and cash equivalents			1,525.0		1,806.3
Accrued investment income			666.5		615.5
Premiums due and other receivables			1,734.2		1,618.2
Deferred acquisition costs			3,509.9		3,680.4
Property and equipment			763.1		692.9
Goodwill			75.1		75.1
Other intangibles			19.6		22.2
Separate account assets			125,801.7		107,343.0
Other assets			1,119.5		1,135.9
	Total assets	$	221,914.7	$	192,412.0
Liabilities
Contractholder funds		$	38,334.6	$	36,861.7
Future policy benefits and claims			35,333.8		30,565.5
Other policyholder funds			791.8		727.2
Long-term debt (2019 and 2018 include $64.2 million and $58.4 million related to consolidated variable
	interest entities)		108.7		129.1
Deferred income taxes			1,823.9		1,029.4
Separate account liabilities			125,801.7		107,343.0
Other liabilities (2019 and 2018 include $122.2 million and $101.3 million related to consolidated variable
	interest entities)		8,331.5		6,904.9
Total liabilities			210,526.0		183,560.8
Stockholder's equity
Common stock, par value $1.00 per share - 5.0 million shares authorized, 2.5 million shares issued
	and outstanding (wholly owned indirectly by Principal Financial Group, Inc.)		2.5		2.5
Additional paid-in capital			6,331.5		6,331.6
Retained earnings			2,410.8		2,441.2
Accumulated other comprehensive income			2,620.7		55.5
	Total stockholder's equity attributable to Principal Life Insurance Company		11,365.5		8,830.8
Noncontrolling interest			23.2		20.4
	Total stockholder's equity		11,388.7		8,851.2
	Total liabilities and stockholder's equity	$	221,914.7	$	192,412.0
See accompanying notes.

B-3

Principal Life Insurance Company
Consolidated Statements of Operations
		For the year ended December 31,
		2019		2018		2017
		(in millions)
Revenues
Premiums and other considerations		$	7,473.3	$	6,092.4	$	5,999.4
Fees and other revenues			2,396.7		2,222.2		2,182.1
Net investment income			3,293.9		3,022.9		2,833.7
Net realized capital gains (losses), excluding impairment losses on
	available-for-sale securities		(68.7)		121.8		451.7
Net other-than-temporary impairment (losses) recoveries on available-
	for-sale securities		(38.3)		10.6		(30.0)
Other-than-temporary impairment losses on fixed maturities, available-
	for-sale reclassified from other comprehensive income		(5.2)		(39.7)		(49.7)
Net impairment losses on available-for-sale securities			(43.5)		(29.1)		(79.7)
Net realized capital gains (losses)			(112.2)		92.7		372.0
	Total revenues		13,051.7		11,430.2		11,387.2
Expenses
Benefits, claims and settlement expenses			9,167.5		7,542.0		7,317.9
Dividends to policyholders			119.1		123.6		124.6
Operating expenses			2,502.3		2,363.5		2,226.7
	Total expenses		11,788.9		10,029.1		9,669.2
Income from continuing operations before income taxes			1,262.8		1,401.1		1,718.0
Income taxes (benefits)			140.2		146.8		(518.40)
Income from continuing operations, net of related income taxes			1,122.6		1,254.3		2,236.4
Income from discontinued operations, net of related income taxes			—		—		37.0
Net income			1,122.6		1,254.3		2,273.4
Net income attributable to noncontrolling interest			9.7		3.3		2.4
Net income attributable to Principal Life Insurance Company		$	1,112.9	$	1,251.0	$	2,271.0
See accompanying notes.

B-4

Principal Life Insurance Company
Consolidated Statements of Comprehensive Income
		For the year ended December 31,
		2019		2018		2017
		(in millions)
Net income		$	1,122.6	$	1,254.3	$	2,273.4
Other comprehensive income (loss), net:
	Net unrealized gains (losses) on available-for-sale securities		2,533.7		(1,513.3)		619.9
	Noncredit component of impairment losses on fixed maturities, available-for-sale		3.0		26.5		27.4
	Net unrealized gains (losses) on derivative instruments		(14.6)		8.0		(49.1)
	Net unrecognized postretirement benefit obligation		43.1		(67.6)		13.3
Other comprehensive income (loss)			2,565.2		(1,546.4)		611.5
Comprehensive income (loss)			3,687.8		(292.1)		2,884.9
Comprehensive income attributable to noncontrolling interest			9.7		3.3		2.4
Comprehensive income (loss) attributable to Principal Life Insurance Company		$	3,678.1	$	(295.4)	$	2,882.5
See accompanying notes.

B-5

Principal Life Insurance Company
Consolidated Statements of Stockholder's Equity
								Accumulated
				Additional				other				Total
		Common		paid-in		Retained		comprehensive		Noncontrolling		stockholder's
		stock		capital		earnings		income		interest		equity
		(in millions)
Balances as of January 1, 2017		$	2.5	$	5,305.6	$	2,139.9	$	748.4	$	42.9	$	8,239.3
Capital distributions to parent			—		(27.5)		—		—		—		(27.5)
Stock-based compensation			—		41.9		(3.0)		—		0.1		39.0
Net true-up of tax asset transferred to affiliate due
	to prior year change in benefit plan sponsorship		—		(3.0)		—		—		—		(3.0)
Dividends to parent			—		—		(1,818.4)		—		—		(1,818.4)
Distributions to noncontrolling interest			—		—		—		—		(3.1)		(3.1)
Contributions from noncontrolling interest			—		—		—		—		6.0		6.0
Purchase of subsidiary shares from noncontrolling
	interest		—		(5.1)		—		—		(1.3)		(6.4)
Sale of subsidiary to parent, net of related income
	taxes, as part of a common control transaction		—		1,034.1		(351.4)		(0.1)		(23.0)		659.6
Net income			—		—		2,271.0		—		2.4		2,273.4
Other comprehensive income			—		—		—		611.5		—		611.5
Balances as of December 31, 2017			2.5		6,346.0		2,238.1		1,359.8		24.0		9,970.4
Capital distributions to parent			—		(21.6)		—		—		—		(21.6)
Stock-based compensation			—		28.6		(2.2)		—		—		26.4
Dividends to parent			—		—		(840.0)		—		—		(840.0)
Distributions to noncontrolling interest			—		—		—		—		(8.3)		(8.3)
Contributions from noncontrolling interest			—		—		—		—		3.0		3.0
Purchase of subsidiary shares from noncontrolling
	interest		—		(21.4)		—		—		(1.6)		(23.0)
Effects of implementation of accounting change
	related to equity investments, net		—		—		(0.1)		0.1		—		—
Effects of implementation of accounting change
	related to revenue recognition, net		—		—		36.4		—		—		36.4
Effects of implementation of accounting change
	related to the reclassification of certain tax
	effects, net		—		—		(242.0)		242.0		—		—
Net income			—		—		1,251.0		—		3.3		1,254.3
Other comprehensive loss			—		—		—		(1,546.4)		—		(1,546.4)
Balances as of December 31, 2018			2.5		6,331.6		2,441.2		55.5		20.4		8,851.2
Capital distributions to parent			—		(24.2)		—		—		—		(24.2)
Stock-based compensation			—		24.1		(2.3)		—		—		21.8
Dividends to parent			—		—		(1,145.0)		—		—		(1,145.0)
Distributions to noncontrolling interest			—		—		—		—		(14.0)		(14.0)
Contributions from noncontrolling interest			—		—		—		—		7.1		7.1
Effects of implementation of accounting change
	related to leases, net		—		—		4.0		—		—		4.0
Net income			—		—		1,112.9		—		9.7		1,122.6
Other comprehensive income			—		—		—		2,565.2		—		2,565.2
Balances as of December 31, 2019		$	2.5	$	6,331.5	$	2,410.8	$	2,620.7	$	23.2	$	11,388.7
See accompanying notes.

B-6

Principal Life Insurance Company
Consolidated Statements of Cash Flows
		For the year ended December 31,
		2019		2018		2017
		(in millions)
Operating activities
Net income		$	1,122.6	$	1,254.3	$	2,273.4
Adjustments to reconcile net income to net cash provided by operating activities:
	Income from discontinued operations, net of related income taxes		—		—		(37.0)
	Net realized capital (gains) losses		112.2		(92.7)		(372.0)
	Depreciation and amortization expense		121.5		111.6		112.2
	Amortization of deferred acquisition costs and contract costs		353.3		260.6		212.1
	Additions to deferred acquisition costs and contract costs		(480.1)		(419.2)		(397.8)
	Stock-based compensation		22.7		26.6		39.3
	(Income) loss from equity method investments, net of dividends received		(40.6)		(32.5)		9.7
Changes in:
	Accrued investment income		(51.0)		(24.5)		(27.3)
	Net cash flows for trading securities and equity securities with operating intent		(58.6)		(124.8)		171.3
	Premiums due and other receivables		(113.3)		62.2		(360.1)
	Contractholder and policyholder liabilities and dividends		3,287.2		3,324.8		3,251.9
	Current and deferred income taxes (benefits)		187.1		253.0		(616.4)
	Real estate acquired through operating activities		(64.7)		(89.2)		(82.5)
	Real estate sold through operating activities		134.9		133.5		1.2
	Other assets and liabilities		522.4		244.3		(212.8)
Other			398.9		266.5		983.3
Net adjustments			4,331.9		3,900.2		2,675.1
Net cash provided by operating activities			5,454.5		5,154.5		4,948.5
Investing activities
Fixed maturities available-for-sale and equity securities with intent to hold:
	Purchases		(12,781.4)		(12,392.8)		(12,878.8)
	Sales		1,509.6		2,701.9		1,142.6
	Maturities		6,587.1		6,008.4		8,407.5
Mortgage loans acquired or originated			(3,366.5)		(3,299.5)		(2,594.0)
Mortgage loans sold or repaid			2,205.4		2,085.6		1,724.0
Real estate acquired			(127.4)		(88.1)		(200.5)
Real estate sold			94.9		63.5		481.9
Net purchases of property and equipment			(51.3)		(48.1)		(105.7)
Net change in other investments			(237.5)		(355.3)		(127.9)
Net cash used in investing activities			(6,167.1)		(5,324.4)		(4,150.9)
Financing activities
Proceeds from financing element derivatives			—		—		0.1
Payments for financing element derivatives			(26.9)		(65.9)		(77.6)
Purchase of subsidiary shares from noncontrolling interest			—		(23.0)		(6.4)
Dividends paid to parent			(1,145.0)		(840.0)		(1,818.4)
Capital contributions from (distributions to) parent			(24.2)		(21.6)		1,006.6
Issuance of long-term debt			12.0		80.2		2.8
Principal repayments of long-term debt			(32.2)		(1.3)		(56.5)
Net repayments of short-term borrowings			—		—		(76.5)
Investment contract deposits			8,727.6		7,896.0		9,760.5
Investment contract withdrawals			(7,709.4)		(6,520.1)		(9,889.9)
Net increase in banking operation deposits			623.4		553.0		136.6
Other			6.0		(4.5)		(2.5)
Net cash provided by (used in) financing activities			431.3		1,052.8		(1,021.2)
Net increase (decrease) in cash and cash equivalents			(281.3)		882.9		(223.6)
Cash and cash equivalents from continuing operations at beginning of period			1,806.3		923.4		1,147.0
Cash and cash equivalents from continuing operations at end of period		$	1,525.0	$	1,806.3	$	923.4
Discontinued operations (excluded from amounts above):
Net cash provided by operating activities		$	—	$	—	$	47.7
Net cash used in investing activities			—		—		(0.6)
Net cash used in financing activities			—		—		(44.7)
Net cash and cash equivalents provided by discontinued operations		$	—	$	—	$	2.4
Supplemental information:
Cash paid for interest		$	6.1	$	3.1	$	3.9
Cash paid for (received from) income taxes		$	(62.9)	$	(91.2)	$	91.0
Supplemental disclosure of non-cash activities:
Note receivable from parent in consideration of subsidiaries sold to parent		$	—	$	—	$	300.0
Assets received in kind for pension risk transfer transactions		$	1,225.8	$	—	$	—
Lease assets established upon adoption of accounting guidance		$	102.2	$	—	$	—
Lease liabilities established upon adoption of accounting guidance		$	97.2	$	—	$	—
Assets and liability changes resulting from exchange agreement to exit real estate joint ventures:
	Real estate properties received	$	—	$	—	$	743.2
	Long-term debt assumed on real estate properties received	$	—	$	—	$	269.0
	Increase in other investments due to discontinuing equity method accounting	$	—	$	—	$	222.4
See accompanying notes.

B-7

Principal Life Insurance Company
Notes to Consolidated Financial StatementsDecember 31, 2019

1. Nature of Operations and Significant Accounting Policies

Description of Business

Principal Life Insurance Company (“PLIC”) along with its consolidated subsidiaries is a diversified financial services organization offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement and insurance in the U.S. We are a direct wholly owned subsidiary of Principal Financial Services, Inc. (“PFS”), which in turn is a direct wholly owned subsidiary of Principal Financial Group, Inc. (“PFG”).

Basis of Presentation

The accompanying consolidated financial statements include the accounts of PLIC and all other entities in which we directly or indirectly have a controlling financial interest as well as those variable interest entities (“VIEs”) in which we are the primary beneficiary. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). All significant intercompany accounts and transactions have been eliminated.

On May 1, 2017, we sold our ownership interest in Principal Global Investors, LLC (“PGI LLC”) to PFS in connection with a corporate reorganization designed to better utilize and allocate capital internally. PGI LLC met the criteria to be reported as a discontinued operation. See Note 2, Discontinued Operations, for further details. Information included in the notes to the financial statements excludes information applicable to the discontinued operations, unless otherwise noted.

We evaluated subsequent events through March 13, 2020, which was the date our consolidated financial statements were issued.

Consolidation

We have relationships with various special purpose entities and other legal entities that must be evaluated to determine if the entities meet the criteria of a VIE or a voting interest entity (“VOE”). This assessment is performed by reviewing contractual, ownership and other rights, including involvement of related parties, and requires use of judgment. First, we determine if we hold a variable interest in an entity by assessing if we have the right to receive expected losses and expected residual returns of the entity. If we hold a variable interest, then the entity is assessed to determine if it is a VIE. An entity is a VIE if the equity at risk is not sufficient to support its activities, if the equity holders lack a controlling financial interest or if the entity is structured with non-substantive voting rights. In addition to the previous criteria, if the entity is a limited partnership or similar entity, it is a VIE if the limited partners do not have the power to direct the entity’s most significant activities through substantive kick-out rights or participating rights. A VIE is evaluated to determine the primary beneficiary. The primary beneficiary of a VIE is the enterprise with (1) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and (2) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. When we are the primary beneficiary, we are required to consolidate the entity in our financial statements. We reassess our involvement with VIEs on a quarterly basis. For further information about VIEs, refer to Note 5, Variable Interest Entities.

If an entity is not a VIE it is considered a VOE. VOEs are generally consolidated if we own a greater than 50% voting interest. If we determine our involvement in an entity no longer meets the requirements for consolidation under either the VIE or VOE models, the entity is deconsolidated. Entities in which we have management influence over the operating and financing decisions but are not required to consolidate, other than investments accounted for at fair value under the fair value option, are reported using the equity method.

B-8

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Recent Accounting Pronouncements

Description	Date of adoption	Effect on our consolidated financial statements or other significant matters
Standards not yet adopted:
Targeted improvements to the accounting for long-duration insurance contracts This authoritative guidance updates certain requirements in the accounting for long-duration insurance and annuity contracts. 1.    The assumptions used to calculate the liability for future policy benefits on traditional and limited-payment contracts will be reviewed and updated periodically. Cash flow assumptions will be reviewed at least annually and updated when necessary with the impact recognized in net income. Discount rate assumptions are prescribed as the current upper-medium grade (low credit risk) fixed income instrument yield and will be updated quarterly with the impact recognized in other comprehensive income (“OCI”). 2.    Market risk benefits, which are certain market-based options or guarantees associated with deposit or account balance contracts, will be measured at fair value. The periodic change in fair value related to instrument-specific credit risk will be recognized in OCI while the remaining change in fair value will be recognized in net income. 3.    Deferred acquisition costs (“DAC”) for all insurance and annuity contracts will be amortized on a constant basis over the expected term of the related contracts. 4.    Additional disclosures are required, including disaggregated rollforwards of significant insurance liabilities and other account balances and disclosures about significant inputs, judgments, assumptions and methods used in measurement. The guidance for the liability for future policy benefits for traditional and limited-payment contracts and DAC will be applied on a modified retrospective basis; that is, to contracts in force as of the beginning of the earliest period presented based on their existing carrying amounts. An entity may elect to apply the changes retrospectively. The guidance for market risk benefits will be applied retrospectively. Early adoption is permitted.	January 1, 2022	Our implementation and evaluation process to date includes, but is not limited to the following: •    identifying and documenting contracts and contract features in scope of the guidance; •    identifying the actuarial models, systems and processes to be updated; •    evaluating and selecting our systems solutions for implementing the new guidance; •    beginning to build key models; •    evaluating our key accounting policies; •    assessing the impact to our chart of accounts; •    developing format and content of new disclosures and •    evaluating transition requirements and impacts. As we progress through our implementation, we will be able to better assess the impact to our consolidated financial statements; however, we expect this guidance to significantly change how we account for many of our insurance and annuity products.
Goodwill impairment testing This authoritative guidance simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 (which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill to the carrying amount of that goodwill) from the goodwill impairment test. A goodwill impairment loss will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. Early adoption is permitted.	January 1, 2020	We expect the guidance will reduce complexity and costs associated with performing a Step 2 test, should one be needed in the future. However, the impact of eliminating the Step 2 test from any such future impairment assessment will be dependent on modeling factors that are not currently determinable. We do not expect this guidance to have a material impact on our consolidated financial statements.

B-9

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Description	Date of adoption	Effect on our consolidated financial statements or other significant matters
Credit losses This authoritative guidance requires entities to use a current expected credit loss (“CECL”) model to measure impairment for most financial assets that are not recorded at fair value through net income. Under the CECL model, an entity will estimate lifetime expected credit losses considering available relevant information about historical events, current conditions and reasonable and supportable forecasts. The CECL model does not apply to available-for-sale debt securities. This guidance also expands the required credit loss disclosures and will be applied using a modified retrospective approach by recording a cumulative effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Early adoption is permitted.	January 1, 2020	The guidance will be adopted using the modified retrospective approach. Our evaluation process is complete and included, but was not limited to, identifying financial assets within scope of the guidance, developing and refining CECL models for the relevant assets, preparing quarterly estimates of the cumulative effect of adoption, developing and refining necessary internal controls and preparing the required financial statement disclosures. The financial statement changes are not material and will result in an immaterial reduction to stockholder’s equity.
Standards adopted:
Implementation costs in a cloud computing arrangement that is a service contract This authoritative guidance aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance can be applied either retrospectively or prospectively and early adoption is permitted.	January 1, 2019	The effective date of the guidance is January 1, 2020; however, we elected to early-adopt this guidance on a prospective basis, effective January 1, 2019. This guidance did not have a material impact on our consolidated financial statements.
Nonemployee share-based payment accounting This authoritative guidance simplifies the accounting for share-based payments to nonemployees by generally aligning it with the accounting for share-based payments to employees. Under the guidance, the measurement of equity-classified nonemployee awards will be fixed at the grant date, where previously the measurement was fixed at performance completion date. The guidance will be applied to equity-classified nonemployee awards for which a measurement date has not been established as of the date of adoption.	January 1, 2019	This guidance did not have a material impact on our consolidated financial statements.

B-10

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Description	Date of adoption	Effect on our consolidated financial statements or other significant matters
Leases This authoritative guidance requires lessee recognition of lease assets and lease liabilities on the balance sheet. The concept of an operating lease, where the lease assets and liabilities are off balance sheet, is eliminated under the new guidance. For lessors, the guidance modifies lease classification criteria and accounting for certain types of leases. Other key aspects of the guidance relate to the removal of the current real estate-specific guidance and new presentation and disclosure requirements. Lessees and lessors are required to recognize and measure leases using a modified retrospective approach, which includes certain optional practical expedients that may be elected. We elected the alternative transition method, which allows entities to initially apply the new standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption.	January 1, 2019	We adopted the guidance using the modified retrospective approach and comparative periods were not restated. Further details are included under the caption “Adoption of Lease Guidance” and in Note 14, Contingencies, Guarantees, Indemnifications and Leases.
Targeted improvements to accounting for hedging activities This authoritative guidance updated certain recognition and measurement requirements for hedge accounting. The objective of the guidance is to more closely align the economics of a company’s risk management activities in its financial results and reduce the complexity of applying hedge accounting. The updates included the expansion of hedging strategies that are eligible for hedge accounting, elimination of the separate measurement and reporting of hedge ineffectiveness, presentation of the changes in the fair value of the hedging instrument in the same consolidated statement of operations line as the earnings effect of the hedged item and simplification of hedge effectiveness assessments. This guidance also included new disclosures.	January 1, 2019	This guidance did not have a material impact on our consolidated financial statements. See Note 7, Derivative Financial Instruments, for further details.
Premium amortization on purchased callable debt securities This authoritative guidance applies to entities that hold certain non-contingently callable debt securities, where the amortized cost basis is at a premium to the price repayable by the issuer at the earliest call date. Under the guidance the premium will be amortized to the first call date.	January 1, 2019	This guidance did not have a material impact on our consolidated financial statements.

B-11

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Description	Date of adoption	Effect on our consolidated financial statements or other significant matters
Reclassification of certain tax effects from accumulated other   comprehensive income  This authoritative guidance permits a reclassification from accumulated other comprehensive income (“AOCI”) to retained earnings for the stranded tax effects resulting from U.S. tax legislation enacted on December 22, 2017, which is referred to as the ‘‘Tax Cuts and Jobs Act’’ (‘‘U.S. tax reform’’). The amount of that reclassification includes the change in corporate income tax rate, as well as an election to include other income tax effects related to the application of U.S. tax reform. The guidance also requires disclosures about stranded tax effects.	January 1, 2018	The effective date of the guidance was January 1, 2019; however, we elected to early adopt the guidance. The guidance was applied at the beginning of the period of adoption and comparative periods were not restated. We reclassified the stranded tax effects in AOCI resulting from U.S. tax reform, which includes the change in corporate income tax rate and an election to reclassify the tax effects of the one-time deemed repatriation tax. A reclassification of $242.0 million was recorded as an increase to AOCI and a decrease to retained earnings.
Revenue recognition This authoritative guidance replaces all general and most industry specific revenue recognition guidance currently prescribed by U.S. GAAP. The core principle is that an entity recognizes revenue to reflect the transfer of a promised good or service to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for that good or service. This guidance also provides clarification on when an entity is a principal or an agent in a transaction. In addition, the guidance updates the accounting for certain costs associated with obtaining and fulfilling a customer contract. The guidance may be applied using one of the following two methods: (1) retrospectively to each prior reporting period presented, or (2) retrospectively with the cumulative effect of initially applying the standard recognized at the date of initial application.	January 1, 2018	We adopted the guidance using the modified retrospective approach. The guidance did not have a material impact on our consolidated financial statements. A cumulative effect adjustment of $36.4 million was recorded as an increase to total stockholder’s equity. See Note 18, Revenues from Contracts with Customers, for further details.
Income tax - intra-entity transfers of assets This authoritative guidance requires entities to recognize current and deferred income tax resulting from an intra-entity asset transfer when the transfer occurs. Prior to issuance of this guidance, U.S. GAAP did not allow recognition of income tax consequences until the asset had been sold to a third party. This guidance requires adoption through a cumulative effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption.	January 1, 2018	We adopted the guidance using the modified retrospective approach. The guidance did not have a material impact on our consolidated financial statements.

B-12

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Description	Date of adoption	Effect on our consolidated financial statements or other significant matters
Financial instruments - recognition and measurement This authoritative guidance addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The guidance eliminated the classification of equity securities into different categories (trading or available-for-sale) and requires equity investments to be measured at fair value with changes in the fair value recognized through net income. The guidance also updated certain financial instrument disclosures and eliminated the requirement to disclose the methods and significant assumptions used to estimate the fair value of financial instruments that are measured at amortized cost on the balance sheet.	January 1, 2018	We adopted this guidance using the modified retrospective approach. A cumulative effect adjustment of $0.1 million was recorded as an increase to AOCI and a corresponding decrease to retained earnings. The guidance did not have a material impact on our consolidated financial statements. See Note 6, Investments, for further details.
Nonfinancial asset derecognition and partial sales of nonfinancial   assets This authoritative guidance clarifies the scope of the recently established guidance on nonfinancial asset derecognition and the accounting for partial sales of nonfinancial assets. The guidance conforms the derecognition guidance on nonfinancial assets with the model for transactions in the new revenue recognition standard.	January 1, 2018	The guidance did not have a material impact on our consolidated financial statements.
Presentation of net periodic pension cost and net periodic   postretirement benefit cost This authoritative guidance requires that an employer disaggregate the service cost component from the other components of net benefit cost. The guidance also provides explicit guidance on the presentation of the service cost component and the other components of net benefit cost in the consolidated statement of operations and allows only the service cost component of net benefit cost to be eligible for capitalization.	January 1, 2018	The guidance did not have a material impact on our consolidated financial statements.
Definition of a business This authoritative guidance clarifies the definition of a business to assist with evaluating when transactions involving an integrated set of assets and activities (a “set”) should be accounted for as acquisitions or disposals of assets or businesses. The guidance requires that when substantially all of the fair value of the gross assets acquired or disposed of is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. The guidance also requires a set to include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output to be considered a business. Lastly, the guidance removes the evaluation of whether a market participant could replace missing elements and narrows the definition of outputs by more closely aligning it with how outputs are described in the revenue recognition guidance. The guidance will be applied prospectively.	January 1, 2018	The guidance did not have a material impact on our consolidated financial statements.
Employee share-based payment accounting This authoritative guidance changes certain aspects of accounting for and reporting share-based payments to employees including changes related to the income tax effects of share-based payments, tax withholding requirements and accounting for forfeitures. Various transition methods will apply depending on the situation being addressed.	January 1, 2017	The guidance was adopted prospectively as indicated by the guidance for each area of change and did not have a material impact on our consolidated financial statements.

B-13

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

When we adopt new accounting standards, we have a process in place to perform a thorough review of the pronouncement, identify the financial statement and system impacts and create an implementation plan among our impacted business units to ensure we are compliant with the pronouncement on the date of adoption. This includes having effective processes and controls in place to support the reported amounts. Each of the standards listed above is in varying stages in our implementation process based on its issuance and adoption dates. We are on track to implement guidance by the respective effective dates.

Adoption of Lease Guidance

On January 1, 2019, we adopted the guidance using the modified retrospective approach with the cumulative effect of initially applying the standard recognized at the date of adoption. We elected the package of practical expedients permitted under the transition guidance. In addition, we elected the hindsight practical expedient to determine the lease term for existing leases. We have agreements with lease and non-lease components, which we account for as a combined unit of account for all classes.

The impact of the guidance to our consolidated financial statements primarily related to the establishment of additional assets and liabilities of $102.2 million and $97.2 million, respectively. The difference between the additional assets and liabilities, net of deferred tax impacts, was recorded as a cumulative effect adjustment to retained earnings and increased total stockholder’s equity by $4.0 million.

Results of reporting periods beginning January 1, 2019, are presented under the new guidance, while prior period amounts are not adjusted and continue to be reported in accordance with our prior accounting. The guidance did not have a material impact on our consolidated statements of operations.

Use of Estimates in the Preparation of Financial Statements

The preparation of our consolidated financial statements and accompanying notes requires management to make estimates and assumptions that affect the amounts reported and disclosed. These estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the consolidated financial statements and accompanying notes. The most critical estimates include those used in determining:

• the fair value of investments in the absence of quoted market values;

• investment impairments and valuation allowances;

• the fair value of and accounting for derivatives;

• the DAC and other actuarial balances where the amortization is based on estimated gross profits (“EGPs”);

• the liability for future policy benefits and claims;

• the value of our other postretirement benefit obligation and

• accounting for income taxes and the valuation of deferred tax assets.

A description of such critical estimates is incorporated within the discussion of the related accounting policies that follow. In applying these policies, management makes subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Actual results could differ from these estimates.

Closed Block

We operate a closed block (“Closed Block”) for the benefit of individual participating dividend‑paying policies in force at the time of the 1998 mutual insurance holding company (“MIHC”) formation. See Note 8, Closed Block, for further details.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, money market instruments and other debt issues with a maturity date of three months or less when purchased.

B-14

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Investments

Fixed maturities include bonds, asset-backed securities (“ABS”), redeemable preferred stock and certain non-redeemable preferred securities. Equity securities include mutual funds, common stock and non-redeemable preferred stock. We classify fixed maturities as either available-for-sale or trading at the time of the purchase and, accordingly, carry them at fair value. Equity securities are also carried at fair value. See Note 16, Fair Value Measurements, for methodologies related to the determination of fair value. Unrealized gains and losses related to fixed maturities, available-for-sale, excluding those in fair value hedging relationships, are reflected in stockholder’s equity, net of adjustments associated with DAC and related actuarial balances, derivatives in cash flow hedge relationships and applicable income taxes. Mark-to-market adjustments on equity securities, unrealized gains and losses related to hedged portions of fixed maturities, available-for-sale in fair value hedging relationships prior to 2019 and mark-to-market adjustments on fixed maturities, trading are reflected in net realized capital gains (losses). Beginning in 2019, unrealized gains and losses related to hedged portions of fixed maturities, available-for-sale in fair value hedging relationships are reflected in net investment income. Mark-to-market adjustments related to certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reflected in net investment income.

The amortized cost of fixed maturities includes cost adjusted for amortization of premiums and discounts, computed using the interest method. The amortized cost of fixed maturities classified as available-for-sale is adjusted for changes in fair value of hedged portions of securities in fair value hedging relationships and declines in value that are other than temporary. Impairments in value deemed to be other than temporary are primarily reported in net income as a component of net realized capital gains (losses), with noncredit impairment losses for certain fixed maturities, available-for-sale reported in OCI. Interest income, as well as prepayment fees and the amortization of the related premium or discount, is reported in net investment income. For loan-backed and structured securities, we recognize income using a constant effective yield based on currently anticipated cash flows.

Real estate investments are reported at cost less accumulated depreciation. The initial cost bases of properties acquired through loan foreclosures are the lower of the fair market values of the properties at the time of foreclosure or the outstanding loan balance. Buildings and land improvements are generally depreciated on the straight-line method over the estimated useful life of improvements and tenant improvement costs are depreciated on the straight-line method over the term of the related lease. We recognize impairment losses for properties when indicators of impairment are present and a property's expected undiscounted cash flows are not sufficient to recover the property's carrying value. In such cases, the cost basis of the property is reduced to fair value. Real estate expected to be disposed is carried at the lower of cost or fair value, less cost to sell, with valuation allowances established accordingly and depreciation no longer recognized. The carrying amount of real estate held for sale was $169.0 million and $207.7 million as of December 31, 2019 and 2018, respectively. Any impairment losses and any changes in valuation allowances are reported in net income.

Commercial and residential mortgage loans are generally reported at cost adjusted for amortization of premiums and accrual of discounts, computed using the interest method and net of valuation allowances. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Interest income, as well as prepayment of fees and the amortization of the related premium or discount, is reported in net investment income.Any changes in the valuation allowances are reported in net realized capital gains (losses). We measure impairment based upon the difference between carrying value and estimated value less cost to sell. Estimated value is based on either the present value of expected cash flows discounted at the loan's effective interest rate, the loan's observable market price or the fair value of the collateral. If foreclosure is probable, the measurement of any valuation allowance is based upon the fair value of the collateral.    

Net realized capital gains and losses on sales of investments are determined on the basis of specific identification. In general, in addition to realized capital gains and losses on investment sales and periodic settlements on derivatives not designated as hedges, we report gains and losses related to the following in net realized capital gains (losses): other-than-temporary impairments of securities and subsequent realized recoveries, mark-to-market adjustments on equity securities, mark-to-market adjustments on fixed maturities, trading, mark-to-market adjustments on certain investment funds, mark-to-market adjustments on derivatives not designated as hedges, cash flow hedge gains (losses) when the hedged item impacts realized capital gains (losses), changes in the mortgage loan valuation allowance provision, impairments of real estate held for investment and impairments of equity method investments. Investment gains and losses on sales of certain real estate held for sale due to investment strategy and mark-to-market adjustments on certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reported as net investment income and are excluded from net realized capital gains (losses).

B-15

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Policy loans and certain other investments are reported at cost. Interests in unconsolidated entities, joint ventures and partnerships are generally accounted for using the equity method. We have other investments reported at fair value or for which the fair value option has been elected in prior periods. See Note 16, Fair Value Measurements, for detail on these investments.

Derivatives

Overview

Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices or the values of securities. Derivatives generally used by us include swaps, options and futures. Derivative positions are either assets or liabilities in the consolidated statements of financial position and are measured at fair value, generally by obtaining quoted market prices or through the use of pricing models. See Note 16, Fair Value Measurements, for policies related to the determination of fair value. Fair values can be affected by changes in interest rates, foreign exchange rates, financial indices, values of securities, credit spreads, and market volatility and liquidity.

Accounting and Financial Statement Presentation

We designate derivatives as either:

(a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment, including those denominated in a foreign currency (“fair value hedge”);

(b) a hedge of a forecasted transaction or the exposure to variability of cash flows to be received or paid related to a recognized asset or liability, including those denominated in a foreign currency (“cash flow hedge”) or

(c) a derivative not designated as a hedging instrument.

Our accounting for the ongoing changes in fair value of a derivative depends on the intended use of the derivative and the designation, as described above, and is determined when the derivative contract is entered into or at the time of redesignation. Hedge accounting is used for derivatives that are specifically designated in advance as hedges and that reduce our exposure to an indicated risk by having a high correlation between changes in the value of the derivatives and the items being hedged at both the inception of the hedge and throughout the hedge period.

Fair Value Hedges. When a derivative is designated as a fair value hedge and is determined to be highly effective, changes in its fair value, along with changes in the fair value of the hedged asset, liability or firm commitment attributable to the hedged risk, are reported in the same income statement line item that is used to report the earnings effect of the hedged item. For fair value hedges of fixed maturities, available-for-sale, these changes in fair value are reported in net investment income. Prior to 2019, these changes in fair value were recorded in net realized capital gains (losses). A fair value hedge determined to be highly effective may still result in a mismatch between the change in the fair value of the hedging instrument and the change in the fair value of the hedged item attributable to the hedged risk.

Cash Flow Hedges. When a derivative is designated as a cash flow hedge and is determined to be highly effective, changes in its fair value are recorded as a component of OCI. At the time the variability of cash flows being hedged impacts net income, the related portion of deferred gains or losses on the derivative instrument is reclassified and reported in net income.

Non-Hedge Derivatives. If a derivative does not qualify or is not designated for hedge accounting, all changes in fair value are reported in net income without considering the changes in the fair value of the economically associated assets or liabilities.

Hedge Documentation and Effectiveness Testing. At inception, we formally document all relationships between hedging instruments and hedged items, as well as our risk management objective and strategy for undertaking various hedge transactions. This process includes associating all derivatives designated as fair value or cash flow hedges with specific assets or liabilities on the consolidated statements of financial position or with specific firm commitments or forecasted transactions. Effectiveness of the hedge is formally assessed at inception and throughout the life of the hedging relationship. Even if a hedge is determined to be highly effective, the hedge may still result in a mismatch between the change in the fair value of the hedging instrument and the change in the fair value of the hedged item attributable to the hedged risk.

B-16

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

We use qualitative and quantitative methods to assess hedge effectiveness. Qualitative methods may include monitoring changes to terms and conditions and counterparty credit ratings. Quantitative methods may include statistical tests including regression analysis and minimum variance and dollar offset techniques.

Termination of Hedge Accounting. We prospectively discontinue hedge accounting when (1) the criteria to qualify for hedge accounting is no longer met, e.g., a derivative is determined to no longer be highly effective in offsetting the change in fair value or cash flows of a hedged item; (2) the derivative expires, is sold, terminated or exercised or (3) we remove the designation of the derivative being the hedging instrument for a fair value or cash flow hedge.

If it is determined that a derivative no longer qualifies as an effective hedge, the derivative will continue to be carried on the consolidated statements of financial position at its fair value, with changes in fair value recognized prospectively in net realized capital gains (losses). The asset or liability under a fair value hedge will no longer be adjusted for changes in fair value pursuant to hedging rules and the existing basis adjustment is amortized to the consolidated statements of operations line associated with the asset or liability. The component of AOCI related to discontinued cash flow hedges that are no longer highly effective is amortized to the consolidated statements of operations consistent with the net income impacts of the original hedged cash flows. If a cash flow hedge is discontinued because it is probable the hedged forecasted transaction will not occur, the deferred gain or loss is immediately reclassified from AOCI into net income.

Embedded Derivatives. We purchase and issue certain financial instruments and products that contain a derivative that is embedded in the financial instrument or product. We assess whether this embedded derivative is clearly and closely related to the asset or liability that serves as its host contract. If we deem that the embedded derivative's terms are not clearly and closely related to the host contract, and a separate instrument with the same terms would qualify as a derivative instrument, the derivative is bifurcated from that contract and held at fair value on the consolidated statements of financial position, with changes in fair value reported in net income.

Contractholder and Policyholder Liabilities

Contractholder and policyholder liabilities (contractholder funds, future policy benefits and claims and other policyholder funds) include reserves for investment contracts, individual and group annuities that provide periodic income payments, universal life insurance, variable universal life insurance, indexed universal life insurance, term life insurance, participating traditional individual life insurance, group dental and vision insurance, group critical illness, group accident, group short-term and long-term disability insurance, group life insurance, individual disability insurance and long-term care insurance. It also includes a provision for dividends on participating policies.

Investment contracts are contractholders' funds on deposit with us and generally include reserves for pension and annuity contracts. Reserves on investment contracts are equal to the cumulative deposits less any applicable charges and withdrawals plus credited interest. Reserves for universal life, variable universal life and indexed universal life insurance contracts are equal to cumulative deposits less charges plus credited interest, which represents the account balances that accrue to the benefit of the policyholders.

We hold additional reserves on certain long-duration contracts where benefit features result in gains in early years followed by losses in later years; universal life, variable universal life and indexed universal life insurance contracts that contain no lapse guarantee features; and annuities with guaranteed minimum death benefits.

Reserves for individual and group annuities that provide periodic income payments, nonparticipating term life insurance and disability income contracts are computed on a basis of assumed investment yield, mortality, morbidity and expenses, including a provision for adverse deviation, which generally varies by plan, year of issue and policy duration. Investment yield is based on our experience. Mortality, morbidity and withdrawal rate assumptions are based on our experience and are periodically reviewed against both industry standards and experience.

Reserves for participating life insurance contracts are based on the net level premium reserve for death and endowment policy benefits. This net level premium reserve is calculated based on dividend fund interest rates and mortality rates guaranteed in calculating the cash surrender values described in the contract.

B-17

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Participating business represented approximately 6%, 7% and 8% of our life insurance in force and 23%, 26% and 29% of the number of life insurance policies in force as of December 31, 2019, 2018 and 2017, respectively. Participating business represented approximately 31%, 34% and 39% of life insurance premiums for the years ended December 31, 2019, 2018 and 2017, respectively. The amount of dividends to policyholders is declared annually by our Board of Directors. The amount of dividends to be paid to policyholders is determined after consideration of several factors including interest, mortality, morbidity and other expense experience for the year and judgment as to the appropriate level of statutory surplus to be retained by us. At the end of the reporting period, we establish a dividend liability for the pro rata portion of the dividends expected to be paid on or before the next policy anniversary date.

Some of our policies and contracts require payment of fees or other policyholder assessments in advance for services that will be rendered over the estimated lives of the policies and contracts. These payments are established as unearned revenue liabilities upon receipt and included in other policyholder funds in the consolidated statements of financial position. These unearned revenue reserves are amortized to net income over the estimated lives of these policies and contracts in relation to the emergence of EGPs.

Short-Duration Contracts

We include the following group products in our short-duration insurance contracts disclosures: long-term disability (“LTD”), group life waiver, dental, vision, short-term disability (“STD”), critical illness, accident and group life.

Future policy benefits and claims include reserves for group life and disability insurance that provide periodic income payments. These reserves are computed using assumptions of mortality, morbidity and investment performance. These assumptions are based on our experience, industry results, emerging trends and future expectations. Future policy benefits and claims also include reserves for incurred but unreported group disability, dental, vision, critical illness, accident and life insurance claims. We recognize claims costs in the period the service was provided to our policyholders. However, claims costs incurred in a particular period are not known with certainty until after we receive, process and pay the claims. We determine the amount of this liability using actuarial methods based on historical claim payment patterns as well as emerging cost trends, where applicable, to determine our estimate of claim liabilities.

We have defined claim frequency as follows for each short-duration product:

• LTD: Claim frequency is based on submitted reserve claim counts.

• Group Life Waiver: Claim frequency is based on submitted reserve claim counts, consistent with LTD.

• Dental and Vision: Claim frequency is based on the claim form, which may include one or more procedures.

• STD, Critical Illness and Accident: Claim frequency is based on submitted claims.

• Group Life: Claim frequency is based on submitted life claims (lives, not coverages).

We did not make any significant changes to our methodologies or assumptions used to calculate the liability for unpaid claims for short-duration contracts during 2019.

Liability for Unpaid Claims

The liability for unpaid claims for both long-duration and short-duration contracts is an estimate of the ultimate net cost of reported and unreported losses not yet settled. This liability is estimated using actuarial analyses and case basis evaluations. Although considerable variability is inherent in such estimates, we believe the liability for unpaid claims is adequate. These estimates are continually reviewed and, as adjustments to this liability become necessary, such adjustments are reflected in net income. Our liability for unpaid claims does not include any allocated claim adjustment expenses.

We incur claim adjustment expenses for both long-duration and short-duration contracts that cannot be allocated to a specific claim. Our claim adjustment expense liability is estimated using actuarial analyses based on historical trends of expenses and expected claim runout patterns.

See Note 10, Insurance Liabilities, under the caption “Liability for Unpaid Claims” for further details.

B-18

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Recognition of Premiums and Other Considerations, Fees and Other Revenues and Benefits

Products with fixed and guaranteed premiums and benefits consist principally of whole life and term life insurance policies and individual disability income. Premiums from these products are recognized as premium revenue when due. Related policy benefits and expenses for individual life products are associated with earned premiums and result in the recognition of profits over the expected term of the policies and contracts.

Immediate annuities with life contingencies include products with fixed and guaranteed annuity considerations and benefits and consist principally of group and individual single premium annuities with life contingencies. Annuity considerations from these products are recognized as premium revenue. However, the collection of these annuity considerations does not represent the completion of the earnings process, as we establish annuity reserves using estimates for mortality and investment assumptions, which include provision for adverse deviation as required by U.S. GAAP. We anticipate profits to emerge over the life of the annuity products as we earn investment income, pay benefits and release reserves.

Group life, dental, vision, critical illness, accident and disability premiums are generally recorded as premium revenue over the term of the coverage. Certain group contracts contain experience premium refund provisions based on a pre-defined formula that reflects their claim experience. Experience premium refunds reduce revenue over the term of the coverage and are adjusted to reflect current experience. Related policy benefits and expenses are associated with earned premiums and result in the recognition of profits over the term of the policies and contracts. Fees for contracts providing claim processing or other administrative services are recorded as revenue over the period the service is provided.

Universal life-type policies are insurance contracts with terms that are not fixed. Amounts received as payments for such contracts are not reported as premium revenues. Revenues for universal life-type insurance contracts consist of policy charges for the cost of insurance, policy initiation and administration, surrender charges and other fees that have been assessed against policy account values and investment income. Policy benefits and claims that are charged to expense include interest credited to contracts and benefit claims incurred in the period in excess of related policy account balances.

Investment contracts do not subject us to significant risks arising from policyholder mortality or morbidity and consist primarily of guaranteed investment contracts (“GICs”), funding agreements and certain deferred annuities. Amounts received as payments for investment contracts are established as investment contract liability balances and are not reported as premium revenues. Revenues for investment contracts consist of investment income and policy administration charges. Investment contract benefits that are charged to expense include benefit claims incurred in the period in excess of related investment contract liability balances and interest credited to investment contract liability balances.

Fees and other revenues are earned for administrative services performed including recordkeeping and reporting services for retirement savings plans, insurance companies, endowments and other financial institutions and other products. Fees and other revenues received for performance of administrative services are recognized as revenue when earned, typically when the service is performed.

Deferred Acquisition Costs

Incremental direct costs of contract acquisition as well as certain costs directly related to acquisition activities (underwriting, policy issuance and processing, medical and inspection and sales force contract selling) for the successful acquisition of new and renewal insurance policies and investment contract business are capitalized to the extent recoverable. Commissions and other incremental direct costs for the acquisition of long-term service contracts are also capitalized to the extent recoverable. Maintenance costs and acquisition costs that are not deferrable are charged to net income as incurred.

DAC for universal life-type insurance contracts and certain investment contracts are amortized over the expected lifetime of the contracts in relation to EGPs or, in certain circumstances, estimated gross revenues (“EGR”). This amortization is adjusted in the current period when EGPs or EGRs are revised. EGRs include similar assumptions as the revenue component of EGPs and the changes of future estimates and reflection of actual experience and market conditions is done in the same manner as EGPs.

B-19

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

For individual variable universal life insurance, individual variable annuities and group annuities that have separate account U.S. equity investment options, we utilize a mean reversion methodology (reversion to the mean assumption), a common industry practice, to determine the future domestic equity market growth rate assumption used for the calculation of EGPs.

DAC for participating life insurance policies are amortized in proportion to estimated gross margins (“EGM”) rather than EGPs. EGMs include similar assumption items as EGPs. We stopped selling participating business in the early 2000s. Some products allow for underwritten death benefit increases and cost of living adjustments, resulting in a small amount of new DAC each year, and the amortization schedules are modified as appropriate.

DAC for non-participating term life insurance and individual disability policies are amortized over the premium-paying period of the related policies using assumptions consistent with those used in computing policyholder liabilities. Once these assumptions are made for a given policy or group of policies, they will not be changed over the life of the policy unless a loss recognition event occurs.

DAC on insurance policies and investment contracts are subject to recoverability testing at the time of policy issue and loss recognition testing on an annual basis, or when an event occurs that may warrant loss recognition. If loss recognition or impairment is necessary, DAC would be written off to the extent it is determined that future policy premiums and investment income or gross profits are not adequate to cover related losses and expenses.

DAC on short-duration group benefits policies are amortized over the estimated term of the underlying contracts.

Deferred Acquisition Costs on Internal Replacements

All insurance and investment contract modifications and replacements are reviewed to determine if the internal replacement results in a substantially changed contract. If so, the acquisition costs, sales inducements and unearned revenue associated with the new contract are deferred and amortized over the lifetime of the new contract. In addition, the existing DAC, sales inducement costs and unearned revenue balances associated with the replaced contract are written off. If an internal replacement results in a substantially unchanged contract, the acquisition costs, sales inducements and unearned revenue associated with the new contract are immediately recognized in the period incurred. In addition, the existing DAC, sales inducement costs or unearned revenue balance associated with the replaced contract is not written off, but instead is carried over to the new contract.

Long-Term Debt

Long-term debt includes notes payable, nonrecourse mortgages and other debt with a maturity date greater than one year at the date of issuance. Current maturities of long-term debt are classified as long-term debt in our consolidated statements of financial position. Long-term debt is primarily recorded at the unpaid principal balance, net of unamortized discount, premium and issuance costs.

Reinsurance

We enter into reinsurance agreements with other companies in the normal course of business in order to limit losses and minimize exposure to significant risks. We may assume reinsurance from or cede reinsurance to other companies. Assets and liabilities related to reinsurance ceded are reported on a gross basis. Premiums and expenses are reported net of reinsurance ceded. The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies. We are contingently liable with respect to reinsurance ceded to other companies in the event the reinsurer is unable to meet the obligations it has assumed. As of December 31, 2019 and 2018, we had $465.3 million and $450.4 million of net ceded reinsurance recoverables related to claims that have been received, respectively. As of December 31, 2019 and 2018, $457.2 million, or 98%, and $435.6 million, or 97%, were with our five largest ceded reinsurers, respectively. Our total amount recoverable from reinsurers includes net ceded reinsurance recoverables related to claims that have been received and reserves ceded to reinsurers; however, it does not reflect potentially offsetting impacts of collateral. As of December 31, 2019 and 2018, the total amount recoverable from reinsurers was $961.4 million and $920.8 million, respectively, and is recognized in premiums due and other receivables.

B-20

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The effects of reinsurance on premiums and other considerations and policy and contract benefits were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Premiums and other considerations:
	Direct	$	7,656.0	$	6,284.8	$	6,202.7
	Assumed		379.7		327.1		279.8
	Ceded		(562.4)		(519.5)		(483.1)
Net premiums and other considerations		$	7,473.3	$	6,092.4	$	5,999.4
Benefits, claims and settlement expenses:
	Direct	$	9,162.3	$	7,528.2	$	7,296.3
	Assumed		581.6		509.8		441.1
	Ceded		(576.4)		(496.0)		(419.5)
Net benefits, claims and settlement expenses		$	9,167.5	$	7,542.0	$	7,317.9

Separate Accounts

The separate accounts are legally segregated and are not subject to the claims that arise out of any of our other business. The client, rather than us, directs the investments and bears the investment risk of these funds. The separate account assets represent the fair value of funds that are separately administered by us for contracts with equity, real estate and fixed income investments and are presented as a summary total within the consolidated statements of financial position. An equivalent amount is reported as separate account liabilities, which represent the obligation to return the monies to the client. We receive fees for mortality, withdrawal and expense risks, as well as administrative, maintenance and investment advisory services that are included in the consolidated statements of operations. Net deposits, net investment income and realized and unrealized capital gains and losses of the separate accounts are not reflected in the consolidated statements of operations. 

As of December 31, 2019 and 2018, the separate accounts included a separate account valued at $100.4 million and $94.9 million, respectively, which primarily included shares of PFG common stock that were allocated and issued to eligible participants of qualified employee benefit plans administered by us as part of the policy credits issued under Principal Mutual Holding Company’s 2001 demutualization. In the consolidated statements of financial position, the separate account shares are recorded at fair value and are reported as separate account assets with a corresponding separate account liability. Changes in fair value of the separate account shares are reflected in both the separate account assets and separate account liabilities and do not impact our results of operations.

Income Taxes

Our ultimate parent, PFG, files a U.S. consolidated income tax return that includes us and all of our qualifying subsidiaries. In addition, we file income tax returns in all states and foreign jurisdictions in which we conduct business. PFG allocates income tax expenses and benefits to companies in the group generally based upon pro rata contribution of taxable income or operating losses. We are taxed at corporate rates on taxable income based on existing tax laws. Current income taxes are charged or credited to net income based upon amounts estimated to be payable or recoverable as a result of taxable operations for the current year. Deferred income taxes are provided for the tax effect of temporary differences in the financial reporting and income tax bases of assets and liabilities, net operating loss carryforwards and tax credit carryforwards using enacted income tax rates and laws. The effect on deferred income tax assets and deferred income tax liabilities of a change in tax rates is recognized in net income in the period in which the change is enacted. Subsequent to a change in tax rates and laws, any stranded tax effects remaining in AOCI will be released only if an entire portfolio is liquidated, sold or extinguished. However, a specific exception to this rule was adopted effective January 1, 2018, to reclassify the stranded tax effects generated by U.S. tax reform from AOCI to retained earnings. Further details are included under the caption “Recent Accounting Pronouncements.”

B-21

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

2. Discontinued Operations

On May 1, 2017, we sold our ownership interest in PGI LLC to PFS. PGI LLC results are subsequently reported as discontinued operations and the results of operations have been removed from our results of continuing operations for all periods presented. Additionally, intercompany eliminations associated with PGI LLC are reported as discontinued operations and have been removed from our results of continuing operations for all periods presented. PGI LLC continues to provide asset management services for us. 

Operating results of the discontinued operations, which reflect the net impact of discontinuing PGI LLC and associated intercompany eliminations, were as follows:

		For the year ended
		December 31, 2017
		(in millions)
Revenues
Fees and other revenues		$	155.9
Net investment income			42.7
Net realized capital gains			1.8
	Total revenues		200.4
Expenses
Operating expenses			148.5
	Total expenses		148.5
Income before income taxes			51.9
Income taxes			14.9
Income from discontinued operations			37.0
Income from discontinued operations attributable to
	noncontrolling interest		1.5
Income from discontinued operations attributable to parent		$	35.5

3. Related Party Transactions

Expense Reimbursements

We have entered into various related party transactions with our ultimate parent and its other affiliates. During the years ended December 31, 2019, 2018 and 2017, we received $607.1 million, $520.7 million and $431.9 million, respectively, of expense reimbursements from affiliated entities.

Cash Advance Agreement

We and our direct parent, PFS, are parties to a cash advance agreement, which allows us, collectively, to pool our available cash with other affiliates in order to more efficiently and effectively invest our cash. The cash advance agreement allows (i) us to advance cash to PFS in aggregate principal amounts not to exceed $1.0 billion, with such advanced amounts earning interest at the daily 30-day LIBOR rate (the “Internal Crediting Rate”); and (ii) PFS to advance cash to us in aggregate principal amounts not to exceed $1.0 billion, with such advance amounts paying interest at the Internal Crediting Rate plus 10 basis points to reimburse PFS for the costs incurred in maintaining short-term investing and borrowing programs. Under this cash advance agreement, we had a receivable from/(payable to) PFS of $(52.9) million and $64.2 million as of December 31, 2019 and 2018, respectively, and earned interest of $4.3 million, $4.9 million and $1.7 million during 2019, 2018 and 2017, respectively.

Reinsurance

We and an affiliated entity, Principal National Life Insurance Company, are parties to a reinsurance agreement to reinsure certain life insurance business. Under this agreement, we had an assumed reinsurance liability of $3,958.9 million and $3,399.2 million as of December 31, 2019 and 2018, respectively. In addition, we recognized premiums and other fees of $672.3 million, $555.4 million and $498.9 million for the years ended December 31, 2019, 2018 and 2017, respectively, associated with this agreement. Furthermore, we recognized expenses of $869.1 million, $776.1 million and $700.3 million for the years ended December 31, 2019, 2018 and 2017, respectively, associated with this agreement.

B-22

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Sale of Subsidiaries

On May 1, 2017, we sold our ownership interest in PGI LLC to PFS as part of a common control transaction. Accordingly, no gain or loss was recognized on the sale and the amount received in excess of book value was recorded in additional paid-in capital. We received $1,068.4 million in cash and a $300.0 million 10-year note from PFS, with the note balance approximating the carrying value of PGI LLC. The note bears interest at 2.885% with semi-annual principal and interest payments due in May and November each year. Subsequent to the sale, we paid an extraordinary dividend of $1,068.4 million to PFS with the cash proceeds received from the sale.

Following the sale of our ownership of PGI LLC, it continues to provide asset management services for us. We recognized $100.1 million, $103.6 million and $65.7 million of asset management fee expense for the years ended December 31, 2019, 2018 and 2017, respectively. Prior to the sale of PGI LLC, these expenses were eliminated upon consolidation.

Our ultimate parent, PFG, is a guarantor of notes received from PFS related to the sale of interests in subsidiaries. We recorded interest income on these notes of $9.8 million, $11.1 million and $9.4 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Distribution of Affiliated Products

We receive commission fees, distribution fees and service fees from Principal Securities, Inc. and PGI LLC. Furthermore, we receive management and administrative fees for investments our products sold in the Principal Mutual Funds and Principal Variable Contracts. Fees and other revenues were $392.7 million, $412.0 million and $433.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. In addition, we pay commission expense to affiliated registered representatives within Principal Securities, Inc. to sell proprietary products. Commission expense was $88.7 million, $82.6 million and $84.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Benefit Plans

PFG is the sponsor of the qualified defined contribution plans for both employees and individual field agents. We were allocated plan expenses from PFG of $32.9 million, $32.1 million and $31.6 million during 2019, 2018 and 2017, respectively.

PFG is also the sponsor of the nonqualified deferred compensation plans for select employees and individual field agents. We were allocated plan expenses from PFG of $1.9 million, $2.0 million and $2.4 million during 2019, 2018 and 2017, respectively.

PFG is the sponsor of the defined benefit pension plans for both employees and individual field agents. We were allocated $46.7 million, $51.2 million and $48.4 million of pension expense from PFG during 2019, 2018 and 2017, respectively.

Other Agreements

Pursuant to certain regulatory requirements or otherwise in the ordinary course of business, we guarantee certain payments of our affiliates and have agreements with affiliates to provide and/or receive management, administrative and other services, all of which, individually and in the aggregate, are immaterial to our business, financial condition and net income.

B-23

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

4. Goodwill and Other Intangible Assets

Goodwill

The carrying amount of goodwill did not change during 2019 and 2018.

Finite Lived Intangible Assets

Amortized intangible assets that continue to be subject to amortization over a weighted average remaining expected life of 14 years were as follows:

	December 31,
	2019		2018
	(in millions)
Gross carrying value	$	41.4	$	41.4
Accumulated amortization		21.8		19.2
Net carrying value	$	19.6	$	22.2

The amortization expense for intangible assets with finite useful lives was $2.6 million, $2.6 million and $2.6 million for 2019, 2018 and 2017, respectively. As of December 31, 2019, the estimated amortization expense for the next five years is as follows (in millions):

Year ending December 31:
	2020	$	2.4
	2021		2.2
	2022		2.0
	2023		1.2
	2024		1.1

5. Variable Interest Entities

We have relationships with various types of entities which may be VIEs. Certain VIEs are consolidated in our financial results. See Note 1, Nature of Operations and Significant Accounting Policies, under the caption “Consolidation” for further details of our consolidation accounting policies. We did not provide financial or other support to investees designated as VIEs for the periods ended December 31, 2019 and December 31, 2018.

Consolidated Variable Interest Entities

Grantor Trust

We contributed undated subordinated floating rate notes to a grantor trust. The trust separated its cash flows by issuing an interest-only certificate and a residual certificate related to each note contributed. Each interest-only certificate entitles the holder to interest on the stated note for a specified term, while the residual certificate entitles the holder to interest payments subsequent to the term of the interest-only certificate and to all principal payments. We retained the interest-only certificates and the residual certificates were subsequently sold to third parties. We determined the grantor trust is a VIE due to insufficient equity to sustain it. We determined we are the primary beneficiary as a result of our contribution of securities into the trust and our significant continuing interest in the trust.

Commercial Mortgage-Backed Securities

We sold commercial mortgage loans to a real estate mortgage investment conduit trust. The trust issued various commercial mortgage-backed securities ("CMBS") certificates using the cash flows of the underlying commercial mortgage loans it purchased. This was considered a VIE due to insufficient equity to sustain itself. We determined we were the primary beneficiary as we retained the special servicing role for the assets within the trust as well as the ownership of the bond class that controls the unilateral kick-out rights of the special servicer. The trust was unwound in the third quarter of 2019.

B-24

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Real Estate

We invest in several real estate limited partnerships and limited liability companies. The entities invest in real estate properties. Certain of these entities are VIEs based on the combination of our significant economic interest and related voting rights. We determined we are the primary beneficiary as a result of our power to control the entities through our significant ownership. Due to the nature of these real estate investments, the investment balance will fluctuate as we purchase and sell interests in the entities and as capital expenditures are made to improve the underlying real estate.

Sponsored Investment Fund

We invest in certain series of an investment fund. These series are VIEs as the equity holders of each series lack the power to direct the most significant activities of the VIE. We determined we are the primary beneficiary of these series as our interest is more than insignificant and collectively we have the power to direct the most significant activities of the fund.

Assets and Liabilities of Consolidated Variable Interest Entities

The carrying amounts of our consolidated VIE assets, which can only be used to settle obligations of consolidated VIEs, and liabilities of consolidated VIEs for which creditors do not have recourse were as follows:

	December 31, 2019				December 31, 2018
	Total		Total		Total		Total
	assets		liabilities		assets		liabilities
	(in millions)
Grantor trust (1)	$	99.9	$	98.6	$	95.0	$	89.4
CMBS		—		—		6.4		—
Real estate (2)		479.7		88.0		379.2		70.6
Sponsored investment fund (3)		19.9		—		37.7		—
Total	$	599.5	$	186.6	$	518.3	$	160.0

(1) The assets of the grantor trust are primarily fixed maturities, available-for-sale. The liabilities are primarily other liabilities that reflect an embedded derivative of the forecasted transaction to deliver the underlying securities.

(2) The assets of the real estate VIEs primarily include real estate and cash. Liabilities primarily include long-term debt and other liabilities.

(3) The assets of the sponsored investment fund include other investments.

Unconsolidated Variable Interest Entities

We hold a variable interest in a number of VIEs where we are not the primary beneficiary. Our investments in these VIEs are reported in fixed maturities, available-for-sale; fixed maturities, trading and other investments in the consolidated statements of financial position and are described below.

Unconsolidated VIEs include certain CMBS, residential mortgage-backed pass-through securities ("RMBS") and other ABS. All of these entities were deemed VIEs because the equity within these entities is insufficient to sustain them. We determined we are not the primary beneficiary in the entities within these categories of investments. This determination was based primarily on the fact we do not own the class of security that controls the unilateral right to replace the special servicer or equivalent function.

We invest in cash collateralized debt obligations, collateralized bond obligations, collateralized loan obligations and other collateralized structures, which are VIEs due to insufficient equity to sustain the entities. We have determined we are not the primary beneficiary of these entities primarily because we do not control the economic performance of the entities and were not involved with the design of the entities or because we do not have a potentially significant variable interest in the entities for which we are the asset manager.

We have invested in various VIE trusts and similar entities as a debt holder. Most of these entities are classified as VIEs due to insufficient equity to sustain them. In addition, we have an entity classified as a VIE based on the combination of our significant economic interest and lack of voting rights. We have determined we are not the primary beneficiary primarily because we do not control the economic performance of the entities and were not involved with the design of the entities.

B-25

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

We have invested in partnerships and other funds, which are classified as VIEs. The entities are VIEs as equity holders lack the power to control the most significant activities of the entities because the equity holders do not have either the ability by a simple majority to exercise substantive kick-out rights or substantive participating rights. We have determined we are not the primary beneficiary because we do not have the power to direct the most significant activities of the entities.

As previously discussed, we sponsor, invest in and have other interests in certain investment funds that are VIEs. We determined we are not the primary beneficiary of the VIEs for which we are the asset manager but do not have a potentially significant variable interest in the funds.

The carrying value and maximum loss exposure for our unconsolidated VIEs were as follows:

				Maximum exposure to
		Asset carrying value		loss (1)
		(in millions)
December 31, 2019
Fixed maturities, available-for-sale:
	Corporate	$	238.2	$	225.7
	Residential mortgage-backed pass-through securities		2,844.2		2,777.5
	Commercial mortgage-backed securities		4,802.7		4,700.8
	Collateralized debt obligations (2)		3,211.2		3,222.6
	Other debt obligations		8,075.4		7,961.4
Fixed maturities, trading:
	Residential mortgage-backed pass-through securities		14.1		14.1
	Commercial mortgage-backed securities		28.1		28.1
	Collateralized debt obligations (2)		20.9		20.9
	Other debt obligations		13.3		13.3
Other investments:
	Other limited partnership and fund interests		635.2		899.1
December 31, 2018
Fixed maturities, available-for-sale:
	Corporate	$	235.3	$	222.6
	Residential mortgage-backed pass-through securities		2,416.2		2,444.4
	Commercial mortgage-backed securities		3,902.8		3,979.4
	Collateralized debt obligations (2)		2,416.9		2,447.0
	Other debt obligations		7,139.5		7,183.0
Fixed maturities, trading:
	Residential mortgage-backed pass-through securities		13.8		13.8
	Commercial mortgage-backed securities		13.4		13.4
	Collateralized debt obligations (2)		11.8		11.8
	Other debt obligations		9.7		9.7
Other investments:
	Other limited partnership and fund interests		575.4		968.6

(1) Our risk of loss is limited to our initial investment measured at amortized cost for fixed maturities, available-for-sale. Our risk of loss is limited to our investment measured at fair value for our fixed maturities, trading. Our risk of loss is limited to our carrying value plus any unfunded commitments and/or guarantees and similar provisions for our other investments. Unfunded commitments are not liabilities on our consolidated statements of financial position because we are only required to fund additional equity when called upon to do so by the general partner or investment manager.

(2) Primarily consists of collateralized loan obligations backed by secured corporate loans.

B-26

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

6. Investments

Fixed Maturities and Equity Securities

The amortized cost, gross unrealized gains and losses, other-than-temporary impairments in AOCI and fair value of available-for-sale securities were as follows:

										Other-than-
				Gross		Gross				temporary
		Amortized		unrealized		unrealized				impairments in
		cost		gains		losses		Fair value		AOCI (1)
		(in millions)
December 31, 2019
Fixed maturities, available-for-sale:
	U.S. government and agencies	$	1,562.7	$	97.2	$	3.0	$	1,656.9	$	—
	Non-U.S. governments		724.6		128.4		—		853.0		—
	States and political subdivisions		6,791.7		639.2		11.5		7,419.4		—
	Corporate		34,057.5		3,086.3		32.7		37,111.1		—
	Residential mortgage-backed pass-through securities		2,777.5		70.5		3.8		2,844.2		—
	Commercial mortgage-backed securities		4,700.8		125.7		23.8		4,802.7		15.8
	Collateralized debt obligations (2)		3,222.6		2.8		14.2		3,211.2		0.9
	Other debt obligations		7,970.8		129.0		14.9		8,084.9		31.8
Total fixed maturities, available-for-sale		$	61,808.2	$	4,279.1	$	103.9	$	65,983.4	$	48.5
December 31, 2018
Fixed maturities, available-for-sale:
	U.S. government and agencies	$	1,383.7	$	16.1	$	16.6	$	1,383.2	$	—
	Non-U.S. governments		683.5		61.2		13.9		730.8		—
	States and political subdivisions		6,065.7		194.6		94.6		6,165.7		—
	Corporate		32,037.2		873.0		821.8		32,088.4		—
	Residential mortgage-backed pass-through securities		2,444.4		21.4		49.6		2,416.2		—
	Commercial mortgage-backed securities		3,979.4		17.0		93.6		3,902.8		16.3
	Collateralized debt obligations (2)		2,447.0		—		30.1		2,416.9		1.2
	Other debt obligations		7,214.8		39.2		82.7		7,171.3		36.2
Total fixed maturities, available-for-sale		$	56,255.7	$	1,222.5	$	1,202.9	$	56,275.3	$	53.7

(1) Excludes $62.3 million and $64.2 million as of December 31, 2019 and December 31, 2018, respectively, of net unrealized gains on impaired fixed maturities, available-for-sale related to changes in fair value subsequent to the impairment date, which are included in gross unrealized gains and gross unrealized losses.

(2) Primarily consists of collateralized loan obligations backed by secured corporate loans.

The amortized cost and fair value of fixed maturities available-for-sale as of December 31, 2019, by expected maturity, were as follows:

	Amortized cost		Fair value
	(in millions)
Due in one year or less	$	2,052.0	$	2,063.8
Due after one year through five years		9,590.6		9,931.5
Due after five years through ten years		11,538.3		12,270.5
Due after ten years		19,955.6		22,774.6
Subtotal		43,136.5		47,040.4
Mortgage-backed and other asset-backed securities		18,671.7		18,943.0
Total	$	61,808.2	$	65,983.4

Actual maturities may differ because borrowers may have the right to call or prepay obligations. Our portfolio is diversified by industry, issuer and asset class. Credit concentrations are managed to established limits.

B-27

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Net Investment Income

Major components of net investment income were as follows:

	For the year ended December 31,
	2019		2018		2017
	(in millions)
Fixed maturities, available-for-sale (1)	$	2,406.5	$	2,249.8	$	2,143.2
Fixed maturities, trading		9.1		6.5		4.3
Equity securities, available-for-sale		—		—		5.4
Equity securities		4.7		4.6		—
Mortgage loans		651.3		587.8		563.5
Real estate		191.0		158.4		129.1
Policy loans		39.7		39.9		40.5
Cash and cash equivalents		39.5		33.5		12.0
Derivatives (1)		(2.0)		0.1		(3.2)
Other		106.0		83.6		96.6
Total		3,445.8		3,164.2		2,991.4
Investment expenses		(151.9)		(141.3)		(157.7)
Net investment income	$	3,293.9	$	3,022.9	$	2,833.7

(1) Upon adoption of authoritative guidance effective January 1, 2019, the change in fair value of fixed maturities, available-for-sale and the change in fair value of derivative hedging instruments in fair value hedging relationships are reported in net investment income with the earnings effect of fixed maturities, available-for-sale. Prior to 2019, the change in fair value of fixed maturities, available-for-sale and the change in fair value of derivative hedging instruments in fair value hedging relationships were reported in net realized capital gains (losses). See Note 7, Derivative Financial Instruments, for further details.

B-28

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Net Realized Capital Gains and Losses

Major components of net realized capital gains (losses) on investments were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Fixed maturities, available-for-sale:
	Gross gains	$	7.9	$	6.8	$	10.3
	Gross losses		(11.4)		(68.8)		(22.7)
	Net impairment losses		(43.5)		(29.1)		(79.6)
	Hedging, net (1)		(9.3)		(39.6)		(28.5)
Fixed maturities, trading (2)			14.4		(7.7)		1.4
Equity securities, available-for-sale:
	Net impairment losses		—		—		(0.1)
Equity securities, trading (3)			—		—		(1.3)
Equity securities (4)			8.2		0.8		—
Mortgage loans			3.3		6.4		9.2
Derivatives (1)			(58.2)		79.2		(195.8)
Other (5)			(23.6)		144.7		679.1
Net realized capital gains (losses)		$	(112.2)	$	92.7	$	372.0

(1) Upon adoption of authoritative guidance effective January 1, 2019, the change in fair value of fixed maturities, available-for-sale and the change in fair value of derivative hedging instruments in fair value hedging relationships are reported in net investment income with the earnings effect of fixed maturities, available-for-sale. Prior to 2019, the change in fair value of fixed maturities, available-for-sale and the change in fair value of derivative hedging instruments in fair value hedging relationships were reported in net realized capital gains (losses). See Note 7, Derivative Financial Instruments, for further details. Gains (losses) for fixed maturities, available-for-sale related to terminated cash flow hedges continue to be reflected in net realized capital gains (losses).

(2) Unrealized gains (losses) on fixed maturities, trading still held at the reporting date were $14.1 million, $(7.6) million and $2.7 million for the years ended December 31, 2019, 2018 and 2017, respectively.

(3) Unrealized losses on equity securities, trading still held at the reporting date were $1.2 million for the year ended December 31, 2017.

(4) Unrealized gains (losses) on equity securities still held at the reporting date were $7.6 million and $(12.5) million for the years ended December 31, 2019 and 2018, respectively.

(5) Other gains in 2018 primarily include a gain from the sale of an equity method investment. Further details relating to other gains in 2017 are included under the caption “Real Estate Transactions.”

Proceeds from sales of investments (excluding call and maturity proceeds) in fixed maturities, available-for-sale were $1,489.3 million, $2,658.1 million and $1,149.8 million in 2019, 2018 and 2017, respectively.

Other-Than-Temporary Impairments

We have a process in place to identify fixed maturity securities that could potentially have an impairment that is other than temporary. Prior to 2018, we also used this process to assess equity securities for impairment. This process involves monitoring market events that could impact issuers’ credit ratings, business climate, management changes, litigation and government actions and other similar factors. This process also involves monitoring late payments, pricing levels, downgrades by rating agencies, key financial ratios, financial statements, revenue forecasts and cash flow projections as indicators of credit issues.

B-29

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Each reporting period, all securities are reviewed to determinewhether an other-than-temporary decline in value exists and whether losses should be recognized. We consider relevant facts and circumstances in evaluating whether a credit or interest rate related impairment of a security is other than temporary. Relevant facts and circumstances considered include: (1) the extent and length of time the fair value has been below cost; (2) the reasons for the decline in value; (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events; (4) for structured securities, the adequacy of the expected cash flows; (5) our intent to sell a security or whether it is more likely than not we will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity and (6) for equity securities, our ability and intent to hold the security for a period of time that allows for the recovery in value. To the extent we determine a security is deemed to be other than temporarily impaired, an impairment loss is recognized.

The way in which impairment losses on fixed maturities are recognized in the financial statements is dependent on the facts and circumstances related to the specific security. If we intend to sell a security or it is more likely than not that we would be required to sell a security before the recovery of its amortized cost, we recognize an other-than-temporary impairment in net income for the difference between amortized cost and fair value. If we do not expect to recover the amortized cost basis, we do not plan to sell the security and if it is not more likely than not that we would be required to sell a security before the recovery of its amortized cost, the recognition of the other-than-temporary impairment is bifurcated. We recognize the credit loss portion in net income and the noncredit loss portion in OCI (“bifurcated OTTI”). Prior to 2018, impairment losses on equity securities were recognized in net income and were measured as the difference between amortized cost and fair value.

Total other-than-temporary impairment losses, net of recoveries from the sale of previously impaired securities, were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Fixed maturities, available-for-sale		$	(38.3)	$	10.6	$	(29.9)
Equity securities, available-for-sale			—		—		(0.1)
Total other-than-temporary impairment losses, net of recoveries from
	the sale of previously impaired securities		(38.3)		10.6		(30.0)
Other-than-temporary impairment losses on fixed maturities,
	available-for-sale reclassified from OCI (1)		(5.2)		(39.7)		(49.7)
Net impairment losses on available-for-sale securities		$	(43.5)	$	(29.1)	$	(79.7)

(1) Represents the net impact of (a) gains resulting from reclassification of noncredit impairment losses for fixed maturities

with bifurcated OTTI from net realized capital gains (losses) to OCI and (b) losses resulting from reclassification of

previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities

with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have

now been sold or are intended to be sold.

We estimate the amount of the credit loss component of a fixed maturity security impairment as the difference between amortized cost and the present value of the expected cash flows of the security. The present value is determined using the best estimate cash flows discounted at the effective interest rate implicit to the security at the date of purchase or the current yield to accrete an asset-backed or floating rate security. The methodology and assumptions for establishing the best estimate cash flows vary depending on the type of security. The ABS cash flow estimates are based on security specific facts and circumstances that may include collateral characteristics, expectations of delinquency and default rates, loss severity and prepayment speeds and structural support, including subordination and guarantees. The corporate security cash flow estimates are derived from scenario-based outcomes of expected corporate restructurings or liquidations using bond specific facts and circumstances including timing, security interests and loss severity.

B-30

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The following table provides a rollforward of accumulated credit losses for fixed maturities with bifurcated credit losses. The purpose of the table is to provide detail of (1) additions to the bifurcated credit loss amounts recognized in net realized capital gains (losses) during the period and (2) decrements for previously recognized bifurcated credit losses where the loss is no longer bifurcated and/or there has been a positive change in expected cash flows or accretion of the bifurcated credit loss amount.

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Beginning balance		$	(117.5)	$	(124.3)	$	(134.7)
Credit losses for which an other-than-temporary impairment was
	not previously recognized		(6.8)		(11.3)		(15.0)
Credit losses for which an other-than-temporary impairment was
	previously recognized		(11.8)		(20.0)		(42.5)
Reduction for credit losses previously recognized on fixed maturities
	now sold, paid down or intended to be sold		54.3		29.5		57.9
Net reduction for positive changes in cash flows expected
	to be collected and amortization (1)		0.8		8.6		10.0
Ending balance		$	(81.0)	$	(117.5)	$	(124.3)

(1) Amounts are recognized in net investment income.

Gross Unrealized Losses for Available-for-Sale Securities

For available-for-sale securities with unrealized losses, including other-than-temporary impairment losses reported in OCI, the gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position were as follows:

			December 31, 2019
			Less than				Greater than or
			twelve months				equal to twelve months				Total
					Gross				Gross				Gross
			Fair		unrealized		Fair		unrealized		Fair		unrealized
			value		losses		value		losses		value		losses
			(in millions)
Fixed maturities, available-for-sale:
	U.S. government and agencies		$	100.0	$	1.9	$	74.2	$	1.1	$	174.2	$	3.0
	Non-U.S. governments			1.3		—		—		—		1.3		—
	States and political subdivisions			557.6		11.1		86.3		0.4		643.9		11.5
	Corporate			985.5		9.1		360.7		23.6		1,346.2		32.7
	Residential mortgage-backed pass-
		through securities		416.8		1.4		237.4		2.4		654.2		3.8
	Commercial mortgage-backed
		securities		829.3		9.2		260.4		14.6		1,089.7		23.8
	Collateralized debt obligations (1)			639.4		1.8		1,445.3		12.4		2,084.7		14.2
	Other debt obligations			1,772.8		9.5		613.7		5.4		2,386.5		14.9
Total fixed maturities, available-for-sale			$	5,302.7	$	44.0	$	3,078.0	$	59.9	$	8,380.7	$	103.9

(1) Primarily consists of collateralized loan obligations backed by secured corporate loans.

B-31

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Of the available-for-sale fixed maturities within our consolidated portfolio in a gross unrealized loss position, 97% were investment grade (rated AAA through BBB-) with an average price of 99 (carrying value/amortized cost) as of December 31, 2019. Gross unrealized losses in our fixed maturities portfolio decreased during the year ended December 31, 2019, primarily due to a decrease in interest rates and tightening of credit spreads.

For those securities that had been in a continuous unrealized loss position for less than twelve months, our consolidated portfolio held 882 securities reflecting an average price of 99 as of December 31, 2019. Of this portfolio, 98% was investment grade (rated AAA through BBB-) as of December 31, 2019, with associated unrealized losses of $43.1 million. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired.

For those securities that had been in a continuous unrealized loss position greater than or equal to twelve months, our consolidated portfolio held 502 securities reflecting an average price of 98 and an average credit rating of AA+ as of December 31, 2019. Corporate securities with unrealized losses had an average price of 94 and an average credit rating of BBB-. Commercial mortgage-backed securities with unrealized losses had an average price of 95 and an average credit rating of AA+. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired.

Because we expected to recover our amortized cost, it was not our intent to sell the fixed maturity available-for-sale securities with unrealized losses and it was not more likely than not that we would be required to sell these securities before recovery of the amortized cost, which may be at maturity, we did not consider these investments to be other-than-temporarily impaired as of December 31, 2019.

			December 31, 2018
			Less than				Greater than or
			twelve months				equal to twelve months				Total
					Gross				Gross				Gross
			Fair		unrealized		Fair		unrealized		Fair		unrealized
			value		losses		value		losses		value		losses
			(in millions)
Fixed maturities, available-for-sale:
	U.S. government and agencies		$	96.1	$	1.4	$	486.7	$	15.2	$	582.8	$	16.6
	Non-U.S. governments			191.3		4.4		164.7		9.5		356.0		13.9
	States and political subdivisions			1,344.6		33.4		1,587.4		61.2		2,932.0		94.6
	Corporate			12,931.1		461.4		6,610.9		360.4		19,542.0		821.8
	Residential mortgage-backed pass-
		through securities		210.1		0.8		1,410.3		48.8		1,620.4		49.6
	Commercial mortgage-backed
		securities		779.4		11.4		2,203.9		82.2		2,983.3		93.6
	Collateralized debt obligations (1)			2,229.4		23.6		162.6		6.5		2,392.0		30.1
	Other debt obligations			982.0		4.9		3,661.4		77.8		4,643.4		82.7
Total fixed maturities, available-for-sale			$	18,764.0	$	541.3	$	16,287.9	$	661.6	$	35,051.9	$	1,202.9

(1) Primarily consists of collateralized loan obligations backed by secured corporate loans.

Of the available-for-sale fixed maturities within our consolidated portfolio in a gross unrealized loss position, 95% were investment grade (rated AAA through BBB-) with an average price of 97 (carrying value/amortized cost) as of December 31, 2018. Gross unrealized losses in our fixed maturities portfolio increased during the year ended December 31, 2018, primarily due to widening of credit spreads and an increase in interest rates.

For those securities that had been in a continuous unrealized loss position for less than twelve months, our consolidated portfolio held 2,076 securities reflecting an average price of 97 as of December 31, 2018. Of this portfolio, 92% was investment grade (rated AAA through BBB-) as of December 31, 2018, with associated unrealized losses of $473.7 million. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired.

B-32

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

For those securities that had been in a continuous unrealized loss position greater than or equal to twelve months, our consolidated portfolio held 2,335 securities reflecting an average price of 96 and an average credit rating of AA- as of December 31, 2018. Corporate securities with unrealized losses had an average price of 95 and an average credit rating of A-. Commercial mortgage-backed securities with unrealized losses had an average price of 96 and an average credit rating of AA+. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired.

Because we expected to recover our amortized cost, it was not our intent to sell the fixed maturity available-for-sale securities with unrealized losses and it was not more likely than not that we would be required to sell these securities before recovery of the amortized cost, which may be at maturity, we did not consider these investments to be other-than-temporarily impaired as of December 31, 2018.

Net Unrealized Gains and Losses on Available-for-Sale Securities and Derivative Instruments

The net unrealized gains and losses on investments in available-for-sale securities, the noncredit component of impairment losses on fixed maturities available-for-sale and the net unrealized gains and losses on derivative instruments in cash flow hedge relationships are reported as separate components of stockholder’s equity. The cumulative amount of net unrealized gains and losses on available-for-sale securities and derivative instruments in cash flow hedge relationships net of adjustments related to DAC and related actuarial balances, policyholder liabilities, noncontrolling interest and applicable income taxes was as follows:

		December 31, 2019		December 31, 2018
		(in millions)
Net unrealized gains on fixed maturities, available-for-sale (1)		$	4,205.7	$	37.8
Noncredit component of impairment losses on fixed maturities, available-for-sale			(48.5)		(53.7)
Net unrealized gains on derivative instruments			94.1		123.3
Adjustments for assumed changes in amortization patterns			(261.0)		30.3
Adjustments for assumed changes in policyholder liabilities			(687.7)		(41.2)
Net unrealized gains on other investments and noncontrolling interest
	adjustments		5.9		15.8
Provision for deferred income taxes			(696.0)		(21.9)
Net unrealized gains on available-for-sale securities and derivative instruments		$	2,612.5	$	90.4

(1) Excludes net unrealized gains (losses) on fixed maturities, available-for-sale included in fair value hedging relationships.

Mortgage Loans

Mortgage loans consist of commercial and residential mortgage loans. We evaluate risks inherent in our commercial mortgage loans in two classes: (1) brick and mortar property loans, including mezzanine loans, where we analyze the property's rent payments as support for the loan, and (2) credit tenant loans (“CTL”), where we rely on the credit analysis of the tenant for the repayment of the loan. We evaluate risks inherent in our residential mortgage loan portfolio in two classes: (1) first lien mortgages and (2) home equity mortgages. The carrying amount of our mortgage loan portfolio was as follows:

		December 31, 2019		December 31, 2018
		(in millions)
Commercial mortgage loans		$	14,758.4	$	13,780.7
Residential mortgage loans			1,088.2		908.3
	Total amortized cost		15,846.6		14,689.0
Valuation allowance			(26.3)		(26.8)
Total carrying value		$	15,820.3	$	14,662.2

B-33

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

We periodically purchase mortgage loans as well as sell mortgage loans we have originated. Mortgage loans purchased and sold were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Commercial mortgage loans:
	Purchased	$	133.9	$	24.7	$	44.4
Residential mortgage loans:
	Purchased		422.8		337.5		276.5
	Sold		—		—		89.3

Our commercial mortgage loan portfolio consists primarily of non-recourse, fixed rate mortgages on stabilized properties. Our commercial mortgage loan portfolio is diversified by geographic region and specific collateral property type as follows:

	December 31, 2019					December 31, 2018
	Amortized		Percent			Amortized		Percent
	cost		of total			cost		of total
	($ in millions)
Geographic distribution
New England	$	615.0		4.2	%	$	642.2		4.7	%
Middle Atlantic		4,151.7		28.2			3,937.9		28.6
East North Central		626.2		4.2			594.7		4.3
West North Central		237.7		1.6			206.2		1.5
South Atlantic		2,324.4		15.7			2,211.9		16.1
East South Central		439.4		3.0			423.3		3.1
West South Central		1,454.7		9.9			1,216.8		8.8
Mountain		934.4		6.3			970.8		7.0
Pacific		3,974.9		26.9			3,576.9		25.9
Total	$	14,758.4		100.0	%	$	13,780.7		100.0	%
Property type distribution
Office	$	4,899.9		33.2	%	$	4,637.6		33.7	%
Retail		2,056.9		13.9			2,310.0		16.8
Industrial		2,274.5		15.4			2,319.1		16.8
Apartments		5,263.6		35.7			4,262.5		30.9
Hotel		91.2		0.6			100.1		0.7
Mixed use/other		172.3		1.2			151.4		1.1
Total	$	14,758.4		100.0	%	$	13,780.7		100.0	%

Our residential mortgage loan portfolio is composed of first lien mortgages with an amortized cost of $1,077.2 million and $893.2 million and home equity mortgages with an amortized cost of $11.0 million and $15.1 million as of December 31, 2019 and December 31, 2018, respectively. Our residential home equity mortgages are generally second lien mortgages comprised of closed-end loans and lines of credit.

B-34

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Mortgage Loan Credit Monitoring

Commercial Credit Risk Profile Based on Internal Rating

We actively monitor and manage our commercial mortgage loan portfolio. All commercial mortgage loans are analyzed regularly and substantially all are internally rated, based on a proprietary risk rating cash flow model, in order to monitor the financial quality of these assets. The model stresses expected cash flows at various levels and at different points in time depending on the durability of the income stream, which includes our assessment of factors such as location (macro and micro markets), tenant quality and lease expirations. Our internal rating analysis presents expected losses in terms of an S&P Global (“S&P”) bond equivalent rating. As the credit risk for commercial mortgage loans increases, we adjust our internal ratings downward with loans in the category “B+ and below” having the highest risk for credit loss. Internal ratings on commercial mortgage loans are updated at least annually and potentially more often for certain loans with material changes in collateral value or occupancy and for loans on an internal “watch list”.

Commercial mortgage loans that require more frequent and detailed attention are identified and placed on an internal “watch list”. Among the criteria that would indicate a potential problem are significant negative changes in ratios of loan to value or contract rents to debt service, major tenant vacancies or bankruptcies, borrower sponsorship problems, late payments, delinquent taxes and loan relief/restructuring requests.

The amortized cost of our commercial mortgage loan portfolio by credit risk, as determined by our internal rating system expressed in terms of an S&P bond equivalent rating, was as follows:

	December 31, 2019
	Brick and mortar		CTL		Total
	(in millions)
A- and above	$	13,698.0	$	76.9	$	13,774.9
BBB+ thru BBB-		877.8		83.8		961.6
BB+ thru BB-		21.9		—		21.9
Total	$	14,597.7	$	160.7	$	14,758.4
	December 31, 2018
	Brick and mortar		CTL		Total
	(in millions)
A- and above	$	12,571.4	$	84.5	$	12,655.9
BBB+ thru BBB-		932.1		105.7		1,037.8
BB+ thru BB-		87.0		—		87.0
Total	$	13,590.5	$	190.2	$	13,780.7

B-35

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Residential Credit Risk Profile Based on Performance Status

Our residential mortgage loan portfolio is monitored based on performance of the loans. Monitoring on a residential mortgage loan increases when the loan is delinquent or earlier if there is an indication of potential impairment. We define non-performing residential mortgage loans as loans 90 days or greater delinquent or on non-accrual status.

The amortized cost of our performing and non-performing residential mortgage loans was as follows:

	December 31, 2019
	First liens		Home equity		Total
	(in millions)
Performing	$	1,074.7	$	8.0	$	1,082.7
Non-performing		2.5		3.0		5.5
Total	$	1,077.2	$	11.0	$	1,088.2
	December 31, 2018
	First liens		Home equity		Total
	(in millions)
Performing	$	890.3	$	10.8	$	901.1
Non-performing		2.9		4.3		7.2
Total	$	893.2	$	15.1	$	908.3

Non-Accrual Mortgage Loans

Commercial and residential mortgage loans are placed on non-accrual status if we have concern regarding the collectability of future payments or if a loan has matured without being paid off or extended. Factors considered may include conversations with the borrower, loss of major tenant, bankruptcy of borrower or major tenant, decreased property cash flow for commercial mortgage loans or number of days past due and other circumstances for residential mortgage loans. Based on an assessment as to the collectability of the principal, a determination is made to apply any payments received either against the principal, against the valuation allowance or according to the contractual terms of the loan. When a loan is placed on non-accrual status, the accrued unpaid interest receivable is reversed against interest income. Accrual of interest resumes after factors resulting in doubts about collectability have improved.

The amortized cost of mortgage loans on non-accrual status was as follows:

		December 31, 2019		December 31, 2018
		(in millions)
Residential:
	First liens	$	2.5	$	2.9
	Home equity		3.0		4.3
Total		$	5.5	$	7.2

B-36

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The aging of our mortgage loans, based on amortized cost, was as follows:

	December 31, 2019
					90 days or
	30-59 days		60-89 days		more past		Total past
	past due		past due		due		due		Current		Total loans
	(in millions)
Commercial-brick and mortar	$	—	$	—	$	—	$	—	$	14,597.7	$	14,597.7
Commercial-CTL		—		—		—		—		160.7		160.7
Residential-first liens		8.5		0.3		2.1		10.9		1,066.3		1,077.2
Residential-home equity		0.8		—		0.3		1.1		9.9		11.0
Total	$	9.3	$	0.3	$	2.4	$	12.0	$	15,834.6	$	15,846.6
	December 31, 2018
					90 days or
	30-59 days		60-89 days		more past		Total past
	past due		past due		due		due		Current		Total loans
	(in millions)
Commercial-brick and mortar	$	—	$	—	$	—	$	—	$	13,590.5	$	13,590.5
Commercial-CTL		—		—		—		—		190.2		190.2
Residential-first liens		3.7		0.8		2.3		6.8		886.4		893.2
Residential-home equity		0.8		0.6		0.4		1.8		13.3		15.1
Total	$	4.5	$	1.4	$	2.7	$	8.6	$	14,680.4	$	14,689.0

We did not have any mortgage loans that were 90 days or more past due and still accruing interest as of either December 31, 2019 or December 31, 2018.

Mortgage Loan Valuation Allowance

We establish a valuation allowance to provide for the risk of credit losses inherent in our portfolio. The valuation allowance includes loan specific reserves for loans that are deemed to be impaired as well as reserves for pools of loans with similar risk characteristics where a property risk or market specific risk has not been identified but for which we anticipate a loss may occur. Mortgage loans on real estate are considered impaired when, based on current information and events, it is probable we will be unable to collect all amounts due according to contractual terms of the loan agreement. When we determine a loan is impaired, a valuation allowance is established equal to the difference between the carrying amount of the mortgage loan and the estimated value reduced by the cost to sell. Estimated value is based on either the present value of the expected future cash flows discounted at the loan's effective interest rate, the loan's observable market price or fair value of the collateral. Subsequent changes in the estimated value are reflected in the valuation allowance. Amounts on loans deemed to be uncollectible are charged off and removed from the valuation allowance. The change in the valuation allowance provision is included in net realized capital gains (losses) on our consolidated statements of operations.

B-37

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The valuation allowance is maintained at a level believed adequate by management to absorb estimated probable credit losses. Management's periodic evaluation and assessment of the valuation allowance adequacy is based on known and inherent risks in the portfolio, adverse situations that may affect a borrower's ability to repay, the estimated value of the underlying collateral, composition of the loan portfolio, portfolio delinquency information, underwriting standards, peer group information, current economic conditions, loss experience and other relevant factors. The evaluation of our impaired loan component is subjective, as it requires the estimation of timing and amount of future cash flows expected to be received on impaired loans.

We review our commercial mortgage loan portfolio and analyze the need for a valuation allowance for any loan that is delinquent for 60 days or more, in process of foreclosure, restructured, on the internal “watch list” or that currently has a valuation allowance. In addition to establishing allowance levels for specifically identified impaired commercial mortgage loans, management determines an allowance for all other loans in the portfolio for which historical experience and current economic conditions indicate certain losses exist. These loans are segregated by risk rating level with an estimated loss ratio applied against each risk rating level. The loss ratio is generally based upon historical loss experience for each risk rating level as adjusted for certain current environmental factors management believes to be relevant.

For our residential mortgage loan portfolio, we separate the loans into several homogeneous pools, each of which consist of loans of a similar nature including but not limited to loans similar in collateral, term and structure and loan purpose or type. We evaluate loan pools based on aggregated risk ratings, estimated specific loss potential in the different classes of credits, and historical loss experience by pool type. We adjust these quantitative factors for qualitative factors of present conditions. Qualitative factors include items such as economic and business conditions, changes in the portfolio, value of underlying collateral and concentrations. Residential mortgage loan pools exclude loans that have been restructured or impaired, as those loans are evaluated individually.

B-38

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

A rollforward of our valuation allowance and ending balances of the allowance and loan balance by basis of impairment method was as follows:

		Commercial		Residential		Total
		(in millions)
For the year ended December 31, 2019
Beginning balance		$	24.3	$	2.5	$	26.8
	Provision		0.2		(3.4)		(3.2)
	Charge-offs		—		(0.5)		(0.5)
	Recoveries		—		3.2		3.2
Ending balance		$	24.5	$	1.8	$	26.3
Allowance ending balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	1.2	$	1.2
	Collectively evaluated for impairment		24.5		0.6		25.1
Allowance ending balance		$	24.5	$	1.8	$	26.3
Loan balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	6.3	$	6.3
	Collectively evaluated for impairment		14,758.4		1,081.9		15,840.3
Loan ending balance		$	14,758.4	$	1,088.2	$	15,846.6
For the year ended December 31, 2018
Beginning balance		$	25.8	$	6.4	$	32.2
	Provision		(1.5)		(4.6)		(6.1)
	Charge-offs		—		(2.4)		(2.4)
	Recoveries		—		3.1		3.1
Ending balance		$	24.3	$	2.5	$	26.8
Allowance ending balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	1.4	$	1.4
	Collectively evaluated for impairment		24.3		1.1		25.4
Allowance ending balance		$	24.3	$	2.5	$	26.8
Loan balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	9.1	$	9.1
	Collectively evaluated for impairment		13,780.7		899.2		14,679.9
Loan ending balance		$	13,780.7	$	908.3	$	14,689.0
For the year ended December 31, 2017
Beginning balance		$	27.4	$	17.1	$	44.5
	Provision		(1.6)		(10.5)		(12.1)
	Charge-offs		—		(5.0)		(5.0)
	Recoveries		—		4.8		4.8
Ending balance		$	25.8	$	6.4	$	32.2
Allowance ending balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	4.5	$	4.5
	Collectively evaluated for impairment		25.8		1.9		27.7
Allowance ending balance		$	25.8	$	6.4	$	32.2
Loan balance by basis of impairment method:
	Individually evaluated for impairment	$	—	$	12.3	$	12.3
	Collectively evaluated for impairment		12,755.2		716.8		13,472.0
Loan ending balance		$	12,755.2	$	729.1	$	13,484.3

B-39

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Impaired Mortgage Loans

Impaired mortgage loans are loans with a related specific valuation allowance, loans whose carrying amount has been reduced to the expected collectible amount because the impairment has been considered other than temporary or a loan modification has been classified as a troubled debt restructuring (“TDR”). Based on an assessment as to the collectability of the principal, a determination is made to apply any payments received either against the principal, against the valuation allowance or according to the contractual terms of the loan. Our recorded investment in and unpaid principal balance of impaired loans along with the related loan specific allowance for losses, if any, and the average recorded investment and interest income recognized during the time the loans were impaired were as follows:

		December 31, 2019
				Unpaid
		Recorded		principal		Related
		investment		balance		allowance
		(in millions)
With no related allowance recorded:
	Residential-first liens	$	0.8	$	—	$	—
With an allowance recorded:
	Residential-first liens		1.7		—		—
	Residential-home equity		3.8		5.0		1.2
Total:
	Residential	$	6.3	$	5.0	$	1.2
		December 31, 2018
				Unpaid
		Recorded		principal		Related
		investment		balance		allowance
		(in millions)
With no related allowance recorded:
	Residential-first liens	$	1.6	$	1.6	$	—
With an allowance recorded:
	Residential-first liens		2.1		2.1		—
	Residential-home equity		5.4		6.5		1.4
Total:
	Residential	$	9.1	$	10.2	$	1.4

B-40

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

		Average
		recorded		Interest income
		investment		recognized
		(in millions)
For the year ended December 31, 2019
With no related allowance recorded:
	Residential-first liens	$	1.2	$	—
With an allowance recorded:
	Residential-first liens		1.9		—
	Residential-home equity		4.6		0.1
Total:
	Residential	$	7.7	$	0.1
For the year ended December 31, 2018
With no related allowance recorded:
	Residential-first liens	$	1.3	$	—
With an allowance recorded:
	Residential-first liens		2.9		0.1
	Residential-home equity		6.5		0.2
Total:
	Residential	$	10.7	$	0.3
For the year ended December 31, 2017
With no related allowance recorded:
	Residential-first liens	$	1.2	$	—
With an allowance recorded:
	Residential-first liens		4.2		0.2
	Residential-home equity		10.3		0.2
Total:
	Residential	$	15.7	$	0.4

Mortgage Loan Modifications

Our commercial and residential mortgage loan portfolios can include loans that have been modified. We assess loan modifications on a case-by-case basis to evaluate whether a TDR has occurred. When we have commercial mortgage loan TDRs, they are modified to delay or reduce principal payments and to reduce or delay interest payments. The commercial mortgage loan modifications result in delayed cash receipts, a decrease in interest income and loan rates that are considered below market. When we have residential mortgage loan TDRs, they include modifications of interest-only payment periods, delays in principal balloon payments and interest rate reductions. Residential mortgage loan modifications result in delayed or decreased cash receipts and a decrease in interest income.

When we have commercial mortgage loan TDRs, they are reserved for in the mortgage loan valuation allowance at the estimated fair value of the underlying collateral reduced by the cost to sell.

When we have residential mortgage loan TDRs, they are specifically reserved for in the mortgage loan valuation allowance if losses result from the modification. Residential mortgage loans that have defaulted or have been discharged through bankruptcy are reduced to the expected collectible amount.

We did not have any significant loans that were modified and met the criteria of a TDR in 2019, 2018 and 2017.

B-41

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Real Estate

Depreciation expense on invested real estate was $60.3 million, $54.1 million and $55.9 million in 2019, 2018 and 2017, respectively. Accumulated depreciation was $525.9 million and $487.0 million as of December 31, 2019 and 2018, respectively.

Real Estate Transactions

In September 2017, we entered an exchange agreement to exit certain real estate joint ventures. The transaction resulted in us transferring our interest in certain real estate properties in exchange for our joint venture partner’s interest in certain other real estate properties. In a subsequent transaction we sold certain of these real estate properties to a third party. Both transactions closed in September 2017, and resulted in a net pre-tax realized capital gain of $690.9 million (net after-tax realized capital gain of $410.8 million).

Other Investments

Other investments include interests in unconsolidated entities, joint ventures and partnerships and properties owned jointly with venture partners and operated by the partners. Such investments are generally accounted for using the equity method. In applying the equity method, we record our share of income or loss reported by the equity investees in net investment income. Summarized financial information for these unconsolidated entities was as follows:

			December 31,
			2019		2018
			(in millions)
Total assets			$	73,594.5	$	61,696.6
Total liabilities				11,862.4		11,589.8
Total equity			$	61,732.1	$	50,106.8
Net investment in unconsolidated entities			$	756.3	$	744.6
	For the year ended December 31,
	2019		2018		2017
	(in millions)
Total revenues	$	10,548.6	$	8,968.6	$	6,561.9
Net income		6,991.8		5,491.6		3,319.6
Our share of net income of unconsolidated entities		55.3		57.7		83.3

In addition, other investments include $734.1 million and $502.6 million of cash surrender value of company owned life insurance as of December 31, 2019 and 2018, respectively.

Derivative assets are carried at fair value and reported as a component of other investments. See Note 7, Derivative Financial Instruments, for further details.

Securities Posted as Collateral

As of December 31, 2019 and 2018, we posted $4,062.0 million and $3,761.3 million, respectively, in commercial mortgage loans and residential first lien mortgages to satisfy collateral requirements associated with our obligation under funding agreements with Federal Home Loan Bank of Des Moines (“FHLB Des Moines”). In addition, as of December 31, 2019 and 2018, we posted $2,633.2 million and $2,383.0 million, respectively, in fixed maturities, available-for-sale and trading securities to satisfy collateral requirements primarily associated with a reinsurance arrangement, our derivative credit support annex (collateral) agreements, Futures Commission Merchant (“FCM”) agreements, a lending arrangement and our obligation under funding agreements with FHLB Des Moines. Since we did not relinquish ownership rights on these instruments, they are reported as mortgage loans, fixed maturities, available-for-sale and fixed maturities, trading, respectively, on our consolidated statements of financial position. Of the securities posted as collateral, as of December 31, 2019 and 2018, $163.9 million and $124.2 million, respectively, could be sold or repledged by the secured party.

B-42

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Balance Sheet Offsetting

Financial assets subject to master netting agreements or similar agreements were as follows:

			Gross amounts not offset in the
			consolidated statements
			of financial position
	Gross amount
	of recognized		Financial		Collateral
	assets (1)		instruments (2)		received		Net amount
	(in millions)
December 31, 2019
Derivative assets	$	279.6	$	(80.2)	$	(197.6)	$	1.8
December 31, 2018
Derivative assets	$	172.6	$	(63.7)	$	(101.6)	$	7.3

(1) The gross amount of recognized derivative assets is reported with other investments on the consolidated statements of financial position. The gross amounts of derivative assets are not netted against offsetting liabilities for presentation on the consolidated statements of financial position.

(2) Represents amount of offsetting derivative liabilities that are subject to an enforceable master netting agreement or similar agreement that are not netted against the gross derivative assets for presentation on the consolidated statements of financial position.

Financial liabilities subject to master netting agreements or similar agreements were as follows:

			Gross amounts not offset in the
			consolidated statements
			of financial position
	Gross amount
	of recognized		Financial		Collateral
	liabilities (1)		instruments (2)		pledged		Net amount
	(in millions)
December 31, 2019
Derivative liabilities	$	147.0	$	(80.2)	$	(57.5)	$	9.3
December 31, 2018
Derivative liabilities	$	104.4	$	(63.7)	$	(34.3)	$	6.4

(1) The gross amount of recognized derivative liabilities is reported with other liabilities on the consolidated statements of financial position. The above excludes $249.9 million and $94.6 million of derivative liabilities as of December 31, 2019 and December 31, 2018, respectively, which are primarily embedded derivatives that are not subject to master netting agreements or similar agreements. The gross amounts of derivative liabilities are not netted against offsetting assets for presentation on the consolidated statements of financial position.

(2) Represents amount of offsetting derivative assets that are subject to an enforceable master netting agreement or similar agreement that are not netted against the gross derivative liabilities for presentation on the consolidated statements of financial position.

The financial instruments that are subject to master netting agreements or similar agreements include right of setoff provisions. Derivative instruments include provisions to setoff positions covered under the agreements with the same counterparties and provisions to setoff positions outside of the agreements with the same counterparties in the event of default by one of the parties. Derivative instruments also include collateral or variation margin provisions, which are generally settled daily with each counterparty. See Note 7, Derivative Financial Instruments, for further details.

B-43

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Repurchase and reverse repurchase agreements include provisions to setoff other repurchase and reverse repurchase balances with the same counterparty. Repurchase and reverse repurchase agreements also include collateral provisions with the counterparties. For reverse repurchase agreements we require the counterparties to pledge collateral with a value greater than the amount of cash transferred. We have the right but do not sell or repledge collateral received in reverse repurchase agreements. Repurchase agreements are structured as secured borrowings for all counterparties. We pledge fixed maturities available-for-sale, which the counterparties have the right to sell or repledge. Interest incurred on repurchase agreements is reported as part of operating expenses on the consolidated statements of operations. Net proceeds related to repurchase agreements are reported as a component of financing activities on the consolidated statements of cash flows. We did not have any outstanding repurchase or reverse repurchase agreements as of December 31, 2019 and December 31, 2018.

7. Derivative Financial Instruments

Derivatives are generally used to hedge or reduce exposure to market risks associated with assets held or expected to be purchased or sold and liabilities incurred or expected to be incurred. Derivatives are used to change the characteristics of our asset/liability mix consistent with our risk management activities. Derivatives are also used in asset replication strategies.

Types of Derivative Instruments

Interest Rate Contracts

Interest rate risk is the risk we will incur economic losses due to adverse changes in interest rates. Sources of interest rate risk include the difference between the maturity and interest rate changes of assets with the liabilities they support, timing differences between the pricing of liabilities and the purchase or procurement of assets and changing cash flow profiles from original projections due to prepayment options embedded within asset and liability contracts. We use various derivatives to manage our exposure to fluctuations in interest rates.

Interest rate swaps are contracts in which we agree with other parties to exchange, at specified intervals, the difference between fixed rate and/or floating rate interest amounts based upon designated market rates or rate indices and an agreed upon notional principal amount. Generally, no cash is exchanged at the outset of the contract and no principal payments are made by any party. Cash is paid or received based on the terms of the swap. We use interest rate swaps primarily to more closely match the interest rate characteristics of assets and liabilities and to mitigate the risks arising from timing mismatches between assets and liabilities (including duration mismatches). We also use interest rate swaps to hedge against changes in the value of assets we anticipate acquiring and other anticipated transactions and commitments. Interest rate swaps are used to hedge against changes in the value of the guaranteed minimum withdrawal benefit (“GMWB”) liability. The GMWB rider on our variable annuity products provides for guaranteed minimum withdrawal benefits regardless of the actual performance of various equity and/or fixed income funds available with the product.

Interest rate options, including interest rate caps and interest rate floors, which can be combined to form interest rate collars, are contracts that entitle the purchaser to pay or receive the amounts, if any, by which a specified market rate exceeds a cap strike interest rate, or falls below a floor strike interest rate, respectively, at specified dates. We use interest rate options to manage prepayment risks in our assets and minimum guaranteed interest rates and lapse risks in our liabilities.

A swaption is an option to enter into an interest rate swap at a future date. We purchase swaptions to hedge interest rate exposure for certain assets and liabilities. Swaptions not only hedge against the downside risk, but also allow us to take advantage of any upside benefits.

In exchange‑traded futures transactions, we agree to purchase or sell a specified number of contracts, the values of which are determined by the values of designated classes of securities, and to post variation margin on a daily basis in an amount equal to the difference in the daily market values of those contracts. We enter into exchange‑traded futures with regulated futures commissions merchants who are members of a trading exchange. We have used exchange‑traded futures to reduce market risks from changes in interest rates and to alter mismatches between the assets in a portfolio and the liabilities supported by those assets.

Foreign Exchange Contracts

Foreign currency risk is the risk we will incur economic losses due to adverse fluctuations in foreign currency exchange rates. This risk arises from foreign currency-denominated funding agreements issued to nonqualified institutional investors in the international market and foreign currency-denominated fixed maturities we invest in. We use currency swaps to manage our exposure to fluctuations in foreign currency exchange rates.

B-44

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Currency swaps are contracts in which we agree with other parties to exchange, at specified intervals, a series of principal and interest payments in one currency for that of another currency. Generally, the principal amount of each currency is exchanged at the beginning and termination of the currency swap by each party. The interest payments are primarily fixed-to-fixed rate; however, they may also be fixed-to-floating rate or floating-to-fixed rate. These transactions are entered into pursuant to master agreements that provide for a single net payment to be made by one counterparty for payments made in the same currency at each due date. We use currency swaps to reduce market risks from changes in currency exchange rates with respect to investments or liabilities denominated in foreign currencies that we either hold or intend to acquire or sell.

Equity Contracts

Equity risk is the risk that we will incur economic losses due to adverse fluctuations in common stock prices. We use various derivatives to manage our exposure to equity risk, which arises from products in which the interest we credit is tied to an external equity index as well as products subject to minimum contractual guarantees.

We purchase equity call spreads (“option collars”) to hedge the equity participation rates promised to contractholders in conjunction with our fixed deferred annuity and universal life products that credit interest based on changes in an external equity index. We use exchange-traded futures and equity put options to hedge against changes in the value of the GMWB liability related to the GMWB rider on our variable annuity product. The premium associated with certain options is paid quarterly over the life of the option contract.

Credit Contracts

Credit risk relates to the uncertainty associated with the continued ability of a given obligor to make timely payments of principal and interest. We use credit default swaps to enhance the return on our investment portfolio by providing comparable exposure to fixed income securities that might not be available in the primary market. They are also used to hedge credit exposures in our investment portfolio. Credit derivatives are used to sell or buy credit protection on an identified name or names on an unfunded or synthetic basis in return for receiving or paying a quarterly premium. The premium generally corresponds to a referenced name's credit spread at the time the agreement is executed. In cases where we sell protection, we also buy a quality cash bond to match against the credit default swap, thereby entering into a synthetic transaction replicating a cash security. When selling protection, if there is an event of default by the referenced name, as defined by the agreement, we are obligated to pay the counterparty the referenced amount of the contract and receive in return the referenced security in a principal amount equal to the notional value of the credit default swap.

Other Contracts

Embedded Derivatives. We purchase or issue certain financial instruments or products that contain a derivative instrument that is embedded in the financial instrument or product. When it is determined that the embedded derivative possesses economic characteristics that are not clearly or closely related to the economic characteristics of the host contract and a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host instrument for measurement purposes. The embedded derivative, which is reported with the host instrument in the consolidated statements of financial position, is carried at fair value.

We offer group annuity contracts that have guaranteed separate accounts as an investment option.

We have structured investment relationships with trusts we have determined to be VIEs, which are consolidated in our financial statements. The notes issued by these trusts include obligations to deliver an underlying security to residual interest holders and the obligations contain an embedded derivative of the forecasted transaction to deliver the underlying security.

We have fixed deferred annuities and universal life products that credit interest based on changes in an external equity index. We also have certain variable annuity products with a GMWB rider, which allows the customer to make withdrawals of a specified annual amount, either for a fixed number of years or for the lifetime of the customer, even if the account value is fully exhausted. Declines in the equity markets may increase our exposure to benefits under contracts with the GMWB. We economically hedge the exposure in these contracts, as previously explained.

B-45

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Exposure

Our risk of loss is typically limited to the fair value of our derivative instruments and not to the notional or contractual amounts of these derivatives. We are also exposed to credit losses in the event of nonperformance of the counterparties. Our current credit exposure is limited to the value of derivatives that have become favorable to us. This credit risk is minimized by purchasing such agreements from financial institutions with high credit ratings and by establishing and monitoring exposure limits. We also utilize various credit enhancements, including collateral and credit triggers to reduce the credit exposure to our derivative instruments.

Derivatives may be exchange-traded or they may be privately negotiated contracts, which are usually referred to as over-the-counter (“OTC”) derivatives. Certain of our OTC derivatives are cleared and settled through central clearing counterparties (“OTC cleared”), while others are bilateral contracts between two counterparties (“bilateral OTC”).Our derivative transactions are generally documented under International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreements. Management believes that such agreements provide for legally enforceable set-off and close-out netting of exposures to specific counterparties. Under such agreements, in connection with an early termination of a transaction, we are permitted to set off our receivable from a counterparty against our payables to the same counterparty arising out of all included transactions. For reporting purposes, we do not offset fair value amounts of bilateral OTC derivatives for the right to reclaim cash collateral or the obligation to return cash collateral against fair value amounts recognized for derivative instruments executed with the same counterparties under master netting agreements. OTC cleared derivatives have variation margin that is legally characterized as settlement of the derivative exposure, which reduces their fair value in the consolidated statements of financial position.

We posted $148.9 million and $88.7 million in cash and securities under collateral arrangements as of December 31, 2019 and December 31, 2018, respectively, to satisfy collateral and initial margin requirements associated with our derivative credit support agreements and FCM agreements.

Certain of our derivative instruments contain provisions that require us to maintain an investment grade rating from each of the major credit rating agencies on our debt. If the ratings on our debt were to fall below investment grade, it would be in violation of these provisions and the counterparties to the derivative instruments could request immediate payment or demand immediate and ongoing full overnight collateralization on derivative instruments in net liability positions. The aggregate fair value, inclusive of accrued interest, of all derivative instruments with credit-risk-related contingent features that were in a liability position without regard to netting under derivative credit support annex agreements as of December 31, 2019 and December 31, 2018, was $151.1 million and $108.7 million, respectively. Cleared derivatives have contingent features that require us to post excess margin as required by the FCM. The terms surrounding excess margin vary by FCM agreement. With respect to derivatives containing collateral triggers, we posted collateral and initial margin of $148.9 million and $88.7 million as of December 31, 2019 and December 31, 2018, respectively, in the normal course of business, which reflects netting under derivative agreements. If the credit-risk-related contingent features underlying these agreements were triggered on December 31, 2019, we would be required to post an additional $42.5 million of collateral to our counterparties.

As of December 31, 2019 and December 31, 2018, we had received $156.8 million and $70.1 million, respectively, of cash collateral associated with our derivative credit support annex agreements and FCM agreements, for which we recorded a corresponding liability reflecting our obligation to return the collateral.

B-46

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Notional amounts are used to express the extent of our involvement in derivative transactions and represent a standard measurement of the volume of our derivative activity. Notional amounts represent those amounts used to calculate contractual flows to be exchanged and are not paid or received, except for contracts such as currency swaps. Credit exposure represents the gross amount owed to us under derivative contracts as of the valuation date. The notional amounts and credit exposure of our derivative financial instruments by type were as follows:

		December 31, 2019		December 31, 2018
		(in millions)
Notional amounts of derivative instruments
Interest rate contracts:
	Interest rate swaps	$	35,173.6	$	34,393.7
	Interest rate options		1,416.9		1,126.9
	Interest rate futures		142.5		260.0
	Swaptions		62.0		—
Foreign exchange contracts:
	Currency swaps		784.0		697.7
Equity contracts:
	Equity options		1,672.8		1,522.5
	Equity futures		149.5		491.7
Credit contracts:
	Credit default swaps		165.0		420.0
Other contracts:
	Embedded derivatives		8,869.5		8,793.9
Total notional amounts at end of period		$	48,435.8	$	47,706.4
Credit exposure of derivative instruments
Interest rate contracts:
	Interest rate swaps	$	181.9	$	95.4
	Interest rate options		28.3		16.3
Foreign exchange contracts:
	Currency swaps		45.2		54.4
Equity contracts:
	Equity options		30.5		7.7
Credit contracts:
	Credit default swaps		0.5		2.4
Total gross credit exposure			286.4		176.2
Less: collateral received			208.3		104.6
Net credit exposure		$	78.1	$	71.6

B-47

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The fair value of our derivative instruments classified as assets and liabilities was as follows:

		Derivative assets (1)				Derivative liabilities (2)
		December 31, 2019		December 31, 2018		December 31, 2019		December 31, 2018
		(in millions)
Derivatives designated as hedging
	instruments
Interest rate contracts		$	—	$	—	$	21.3	$	16.1
Foreign exchange contracts			30.0		37.6		15.2		13.5
Total derivatives designated as hedging
	instruments	$	30.0	$	37.6	$	36.5	$	29.6
Derivatives not designated as hedging
	instruments
Interest rate contracts		$	204.2	$	108.0	$	16.7	$	22.6
Foreign exchange contracts			14.4		17.0		29.5		20.2
Equity contracts			30.5		7.7		63.1		27.6
Credit contracts			0.5		2.3		1.2		4.4
Other contracts			—		—		249.9		94.6
Total derivatives not designated as hedging
	instruments		249.6		135.0		360.4		169.4
Total derivative instruments		$	279.6	$	172.6	$	396.9	$	199.0

(1) The fair value of derivative assets is reported with other investments on the consolidated statements of financial position.

(2) The fair value of derivative liabilities is reported with other liabilities on the consolidated statements of financial position, with the exception of certain embedded derivative liabilities. Embedded derivatives with a net liability fair value of $151.2 million and $5.3 million as of December 31, 2019 and December 31, 2018, respectively, are reported with contractholder funds on the consolidated statements of financial position.

Credit Derivatives Sold

When we sell credit protection, we are exposed to the underlying credit risk similar to purchasing a fixed maturity security instrument. Our credit derivative contracts sold reference a single name or reference security (referred to as “single name credit default swaps”). These instruments are either referenced in an OTC credit derivative transaction or embedded within an investment structure that has been fully consolidated into our financial statements.

These credit derivative transactions are subject to events of default defined within the terms of the contract, which normally consist of bankruptcy, failure to pay, or modified restructuring of the reference entity and/or issue. If a default event occurs for a reference name or security, we are obligated to pay the counterparty an amount equal to the notional amount of the credit derivative transaction. As a result, our maximum future payment is equal to the notional amount of the credit derivative. In certain cases, we also may have purchased credit protection with identical underlyings to certain of our sold protection transactions. As of December 31, 2019 and December 31, 2018, we did not purchase credit protection relating to our sold protection transactions. In certain circumstances, our potential loss could also be reduced by any amount recovered in the default proceedings of the underlying credit name.

B-48

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The following tables show our credit default swap protection sold by types of contract, types of referenced/underlying asset class and external agency rating for the underlying reference security. The maximum future payments are undiscounted and have not been reduced by the effect of any offsetting transactions, collateral or recourse features described above.

			December 31, 2019
									Weighted
							Maximum		average
			Notional		Fair		future		expected life
			amount		value		payments		(in years)
			(in millions)
Single name credit default swaps
	Corporate debt
		A	$	5.0	$	—	$	5.0		0.5
		BBB		70.0		0.2		70.0		2.6
	Sovereign
		BBB		15.0		0.3		15.0		2.0
Total credit default swap protection sold			$	90.0	$	0.5	$	90.0		2.4

			December 31, 2018
									Weighted
							Maximum		average
			Notional		Fair		future		expected life
			amount		value		payments		(in years)
			(in millions)
Single name credit default swaps
	Corporate debt
		AAA	$	10.0	$	0.1	$	10.0		0.7
		A		15.0		0.1		15.0		1.0
		BBB		190.0		0.4		190.0		1.7
		BB		10.0		—		10.0		0.5
		CCC		15.0		(3.6)		15.0		0.9
	Government/municipalities
		AA		20.0		0.2		20.0		1.0
	Sovereign
		A		10.0		0.1		10.0		0.7
		BBB		55.0		0.4		55.0		1.3
Total credit default swap protection sold			$	325.0	$	(2.3)	$	325.0		1.4

Fair Value and Cash Flow Hedges

Fair Value Hedges

We use fixed-to-floating rate interest rate swaps to more closely align the interest rate characteristics of certain assets and have used them to align the interest rate characteristics of certain liabilities. In general, these swaps are used in asset and liability management to modify duration, which is a measure of sensitivity to interest rate changes.

The net interest effect of interest rate swap transactions for derivatives in fair value hedges is recorded as an adjustment to income or expense of the underlying hedged item in our consolidated statements of operations.

B-49

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The following amounts were recorded on the consolidated statements of financial position related to cumulative basis adjustments for fair value hedges. The amortized cost includesthe amortized cost basis and the fair value hedging basis adjustment.

						Cumulative amount of fair
						value hedging basis adjustment
Line item in the consolidated statements						included in the amortized cost
of financial position in which the		Amortized cost of hedged item				of the hedged item
hedged item is included		December 31, 2019		December 31, 2018		December 31, 2019		December 31, 2018
		(in millions)
Fixed maturities, available-for-sale:
	Active hedging relationships	$	142.0	$	137.0	$	18.1	$	12.4
	Discontinued hedging relationships		159.3		298.9		7.7		13.3
Total fixed maturities, available-for-sale in
	active or discontinued hedging relationships	$	301.3	$	435.9	$	25.8	$	25.7

Cash Flow Hedges

We utilized floating-to-fixed rate interest rate swaps to eliminate the variability in cash flows of recognized financial assets and liabilities and forecasted transactions.

We enter into currency exchange swap agreements to convert both principal and interest payments of certain foreign denominated assets and liabilities into U.S. dollar denominated fixed-rate instruments to eliminate the exposure to future currency volatility on those items.

The net interest effect of interest rate swap and currency swap transactions for derivatives in cash flow hedges is recorded as an adjustment to income or expense of the underlying hedged item in our consolidated statements of operations.

The maximum length of time we are hedging our exposure to the variability in future cash flows for forecasted transactions, excluding those related to the payments of variable interest on existing financial assets and liabilities, is 0.5 years. As of December 31, 2019, we had $0.0 million of net gains reported in AOCI on the consolidated statements of financial position related to active hedges of forecasted transactions. If a hedged forecasted transaction is no longer probable of occurring, cash flow hedge accounting is discontinued. If it is probable that the hedged forecasted transaction will not occur, the deferred gain or loss is immediately reclassified from AOCI into net income.

The following table shows the effect of derivatives in cash flow hedging relationships on the consolidated statements of financial position.

		Amount of gain (loss) recognized in AOCI on derivatives
Derivatives in cash flow		for the year ended December 31,
hedging relationships	Related hedged item	2019		2018		2017
		(in millions)
Interest rate contracts	Fixed maturities, available-for-sale	$	(9.9)	$	36.7	$	(51.7)
Foreign exchange contracts	Fixed maturities, available-for-sale		(9.4)		20.8		(68.5)
Foreign exchange contracts	Investment contracts		—		(0.1)		—
Total		$	(19.3)	$	57.4	$	(120.2)

We expect to reclassify net gains of $24.3 million from AOCI into net income in the next 12 months, which includes both net deferred gains on discontinued hedges and net losses on periodic settlements of active hedges. Actual amounts may vary from this amount as a result of market conditions.

B-50

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations

The following tables show the effect of derivatives in fair value and cash flow hedging relationships and the related hedged items on the consolidated statements of operations.

			For the year ended December 31, 2019
							Benefits,
			Net investment		Net realized		claims and
			income related		capital gains		settlement
			to hedges		(losses) related to		expenses
			of fixed		hedges of fixed		related to
			maturities,		maturities,		hedges of
			available-		available-		investment
			for-sale		for-sale		contracts
			(in millions)
Total amounts of consolidated statement of operations line items in
	which the effects of fair value and cash flow hedges are reported		$	3,293.9	$	(112.2)	$	9,167.5
Losses on fair value hedging relationships:
Interest rate contracts:
	Gain recognized on hedged item		$	5.7	$	—	$	—
	Loss recognized on derivatives			(6.0)		—		—
	Amortization of hedged item basis adjustments			(4.2)		—		—
	Amounts related to periodic settlements on derivatives			(3.4)		—		—
Total loss recognized for fair value hedging relationships			$	(7.9)	$	—	$	—
Gains (losses) on cash flow hedging relationships:
Interest rate contracts:
	Gain (loss) reclassified from AOCI on derivatives		$	19.8	$	(0.6)	$	(0.1)
	Gain reclassified from AOCI into net income as a result that a
		forecasted transaction is no longer probable of occurring		—		0.1		—
Foreign exchange contracts:
	Gain reclassified from AOCI on derivatives			—		9.5		—
	Amounts related to periodic settlements on derivatives			7.4		—		—
Total gain (loss) recognized for cash flow hedging relationships			$	27.2	$	9.0	$	(0.1)

B-51

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

			For the year ended December 31, 2018
							Benefits,
			Net investment		Net realized		claims and
			income related		capital gains		settlement
			to hedges		(losses) related to		expenses
			of fixed		hedges of fixed		related to
			maturities,		maturities,		hedges of
			available-		available-		investment
			for-sale		for-sale		contracts
			(in millions)
Total amounts of consolidated statement of operations line items in
	which the effects of fair value and cash flow hedges are reported		$	3,022.9	$	92.7	$	7,542.0
Losses on fair value hedging relationships:
Interest rate contracts:
	Loss recognized on hedged item		$	—	$	(6.6)	$	—
	Gain recognized on derivatives			—		6.2		—
	Amortization of hedged item basis adjustments			(6.7)		—		—
	Amounts related to periodic settlements on derivatives			(5.9)		—		—
Total loss recognized for fair value hedging relationships			$	(12.6)	$	(0.4)	$	—
Gains (losses) on cash flow hedging relationships:
Interest rate contracts:
	Gain (loss) reclassified from AOCI on derivatives		$	20.9	$	17.0	$	(0.1)
	Gain reclassified from AOCI as a result that a forecasted
		transaction is no longer probable of occurring		—		0.3		—
Foreign exchange contracts:
	Gain reclassified from AOCI on derivatives			—		12.7		—
	Amounts related to periodic settlements on derivatives			6.0		—		(0.1)
Total gain (loss) recognized for cash flow hedging relationships			$	26.9	$	30.0	$	(0.2)

B-52

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

			For the year ended December 31, 2017
			Net
			investment								Benefits,
			income		Net realized capital gains (losses)						claims and
			related		Related to						settlement
			to hedges		hedges						expenses
			of fixed		fixed		Related to				related to
			maturities,		maturities,		hedges of				hedges of
			available-		available-		investment				investment
			for-sale		for-sale		contracts		Total		contracts
			(in millions)
Total amounts of consolidated statement of operations line
	items in which the effects of fair value and cash flow
	hedges are reported		$	2,833.7					$	372.0	$	7,317.9
Gains (losses) on fair value hedging relationships:
Interest rate contracts:
	Gain (loss) recognized on hedged item		$	—	$	(5.2)	$	0.6	$	(4.6)	$	—
	Gain (loss) recognized on derivatives			—		4.7		(0.6)		4.1		—
	Amortization of hedged item basis adjustments			(11.6)		—		—		—		(0.5)
	Amounts related to periodic settlements on derivatives			(10.3)		—		—		—		0.9
Total gain (loss) recognized for fair value hedging
	relationships		$	(21.9)	$	(0.5)	$	—	$	(0.5)	$	0.4
Gains (losses) on cash flow hedging relationships:
Interest rate contracts:
	Gain (loss) reclassified from AOCI on derivatives		$	21.0	$	(0.7)	$	—	$	(0.7)	$	—
	Gain reclassified from AOCI as a result that a forecasted
		transaction is no longer probable of occurring		—		0.2		—		0.2		—
Foreign exchange contracts:
	Gain reclassified from AOCI on derivatives			—		21.9		—		21.9		—
	Amounts related to periodic settlements on derivatives			7.1		—		—		—		(1.2)
Total gain (loss) recognized for cash flow hedging
	relationships		$	28.1	$	21.4	$	—	$	21.4	$	(1.2)

Derivatives Not Designated as Hedging Instruments

Our use of futures, certain swaptions and swaps, option collars and options are effective from an economic standpoint, but they have not been designated as hedges for financial reporting purposes. As such, periodic changes in the market value of these instruments, which includes mark-to-market gains and losses as well as periodic and final settlements, primarily flow directly into net realized capital gains (losses) on the consolidated statements of operations.

B-53

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The following table shows the effect of derivatives not designated as hedging instruments, including fair value changes of embedded derivatives that have been bifurcated from the host contract, on the consolidated statements of operations.

	Amount of gain (loss) recognized in
	net income on derivatives for the
	year ended December 31,
Derivatives not designated as hedging instruments	2019		2018		2017
	(in millions)
Interest rate contracts	$	218.0	$	(27.6)	$	(26.9)
Foreign exchange contracts		(1.3)		4.1		18.1
Equity contracts		(132.9)		(31.0)		(181.3)
Credit contracts		(3.6)		(1.6)		(15.9)
Other contracts		(145.3)		107.9		6.8
Total	$	(65.1)	$	51.8	$	(199.2)

8. Closed Block

In connection with the 1998 MIHC formation, we formed a Closed Block to provide reasonable assurance to policyholders included therein that, after the formation of the MIHC, assets would be available to maintain dividends in aggregate in accordance with the 1997 policy dividend scales, if the experience underlying such scales continued. Our assets were allocated to the Closed Block in an amount that produces cash flows which, together with anticipated revenue from policies and contracts included in the Closed Block, were expected to be sufficient to support the Closed Block policies. This includes, but is not limited to, provisions for payment of claims, certain expenses, charges and taxes, and to provide for continuation of policy and contract dividends in aggregate in accordance with the 1997 dividend scales, if the experience underlying such scales continues, and to allow for appropriate adjustments in such scales, if such experience changes. Due to adjustable life policies being included in the Closed Block, the Closed Block is charged with amounts necessary to properly fund for certain adjustments, such as face amount and premium increases, that are made to these policies after the Closed Block inception date. These amounts are referred to as Funding Adjustment Charges and are treated as capital transfers from the Closed Block.

Assets allocated to the Closed Block inure solely to the benefit of the holders of policies included in the Closed Block. Closed Block assets and liabilities are carried on the same basis as other similar assets and liabilities. We will continue to pay guaranteed benefits under all policies, including the policies within the Closed Block, in accordance with their terms. If the assets allocated to the Closed Block, the investment cash flows from those assets and the revenues from the policies included in the Closed Block, including investment income thereon, prove to be insufficient to pay the benefits guaranteed under the policies included in the Closed Block, we will be required to make such payments from our general funds. No additional policies were added to the Closed Block, nor was the Closed Block affected in any other way, as a result of the demutualization.

A policyholder dividend obligation (“PDO”) is required to be established for higher than expected earnings in the Closed Block that will need to be paid as dividends unless future performance of the Closed Block is less favorable than originally expected. A model of the Closed Block was established to produce the pattern of expected earnings, assets and liabilities in the Closed Block. These projections are utilized to determine ratios that will allow us to compare actual cumulative earnings to expected cumulative earnings and determine the amount of the PDO. As of December 31, 2019 and 2018, the PDO was $202.7 million and $36.6 million, respectively.

B-54

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Closed Block liabilities and assets designated to the Closed Block were as follows:

		December 31, 2019		December 31, 2018
		(in millions)
Closed Block liabilities
Future policy benefits and claims		$	3,563.1	$	3,732.5
Other policyholder funds			6.6		6.5
Policyholder dividends payable			199.1		211.3
Policyholder dividends obligation			202.7		36.6
Other liabilities			7.8		9.5
	Total Closed Block liabilities		3,979.3		3,996.4
Assets designated to the Closed Block
Fixed maturities, available-for-sale			2,269.6		2,176.4
Fixed maturities, trading			2.6		2.5
Equity securities			1.1		1.0
Mortgage loans			622.8		678.5
Policy loans			486.0		510.5
Other investments			46.4		33.8
	Total investments		3,428.5		3,402.7
Cash and cash equivalents			47.5		42.1
Accrued investment income			38.1		39.5
Premiums due and other receivables			9.7		10.0
Deferred tax asset			29.5		30.5
	Total assets designated to the Closed Block		3,553.3		3,524.8
Excess of Closed Block liabilities over assets designated to the Closed Block			426.0		471.6
Amounts included in accumulated other comprehensive income			0.9		5.2
Maximum future earnings to be recognized from Closed Block assets and
	liabilities	$	426.9	$	476.8

Closed Block revenues and expenses were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Revenues
Premiums and other considerations		$	227.6	$	244.2	$	275.6
Net investment income			154.4		160.5		169.4
Net realized capital gains (losses)			7.4		(3.4)		(5.8)
	Total revenues		389.4		401.3		439.2
Expenses
Benefits, claims and settlement expenses			204.4		211.5		245.6
Dividends to policyholders			116.3		120.9		122.0
Operating expenses			2.9		3.3		3.5
	Total expenses		323.6		335.7		371.1
Closed Block revenues, net of Closed Block expenses, before income taxes			65.8		65.6		68.1
Income taxes			12.9		11.1		46.0
Closed Block revenues, net of Closed Block expenses and income taxes			52.9		54.5		22.1
Funding adjustments			(3.0)		(0.5)		(4.4)
Closed Block revenues, net of Closed Block expenses, income taxes and
	funding adjustments	$	49.9	$	54.0	$	17.7

B-55

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The change in maximum future earnings of the Closed Block was as follows:

	For the year ended December 31,
	2019		2018		2017
	(in millions)
Beginning of year	$	476.8	$	532.1	$	549.8
Effects of implementation of accounting changes (1)		—		1.3		—
End of year		426.9		476.8		532.1
Change in maximum future earnings	$	(49.9)	$	(54.0)	$	(17.7)

(1) Includes the effects of implementation of accounting changes related to equity investments and the reclassification of certain tax effects.

We charge the Closed Block with U.S. federal income taxes, payroll taxes, state and local premium taxes and other state or local taxes, licenses and fees as provided in the plan of reorganization.

9. Deferred Acquisition Costs

Acquisition costs deferred and amortized were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Balance at beginning of year		$	3,680.4	$	3,331.7	$	3,184.2
Costs deferred during the year			473.0		414.2		397.8
Amortized to expense during the year (1)			(345.8)		(252.2)		(212.1)
Adjustment related to unrealized (gains) losses on available-for-sale
	securities and derivative instruments		(297.7)		186.7		(38.2)
Balance at end of year		$	3,509.9	$	3,680.4	$	3,331.7

(1) Includes adjustments for revisions to EGPs.

10. Insurance Liabilities

Contractholder Funds

Major components of contractholder funds in the consolidated statements of financial position were as follows:

		December 31,
		2019		2018
		(in millions)
Liabilities for investment contracts:
	Liabilities for individual annuities	$	13,457.5	$	12,913.9
	GICs		10,423.5		10,321.7
	Funding agreements		8,640.6		7,729.5
	Other investment contracts		893.6		907.3
Total liabilities for investment contracts			33,415.2		31,872.4
Universal life and other reserves			4,919.4		4,989.3
Total contractholder funds		$	38,334.6	$	36,861.7

Our GICs and funding agreements contain provisions limiting or prohibiting early surrenders, which typically include penalties for early surrenders, minimum notice requirements or, in the case of funding agreements with survivor options, minimum pre-death holding periods and specific maximum amounts.

B-56

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Funding agreements include those issued directly to nonqualified institutional investors and those issued to the FHLB Des Moines under their membership funding programs. As of December 31, 2019 and 2018, $4,010.9 million and $3,512.2 million, respectively, of liabilities were outstanding with respect to issuances under the program with FHLB Des Moines. In addition, we have five separate programs where the funding agreements have been issued directly or indirectly to unconsolidated special purpose entities. Claims for principal and interest under funding agreements are afforded equal priority to claims of life insurance and annuity policyholders under insolvency provisions of Iowa Insurance Laws.

We were authorized to issue up to $4.0 billion of funding agreements under a program established in 1998 to support the prospective issuance of medium term notes by an unaffiliated entity in non-U.S. markets. As of December 31, 2019 and 2018, $75.2 million and $109.6 million, respectively, of liabilities were outstanding with respect to the issuance outstanding under this program. We were also authorized to issue up to Euro 4.0 billion (approximately USD$5.3 billion) of funding agreements under a program established in 2006 to support the prospective issuance of medium term notes by an unaffiliated entity in non-U.S. markets. The unaffiliated entity is an unconsolidated special purpose entity. As of December 31, 2019 and 2018, $112.2 million and $114.4 million, respectively, of liabilities were outstanding with respect to issuances outstanding under this program. We do not anticipate any new issuance activity under either of these programs due to the existence of the program established in 2011 described below.

In addition, we were authorized to issue up to $7.0 billion of funding agreements under a program established in 2001 to support the prospective issuance of medium term notes by an unaffiliated entity in both domestic and international markets. The unaffiliated entity is an unconsolidated special purpose entity. As of December 31, 2019 and 2018, $201.7 million and $201.6 million, respectively, of liabilities were being held with respect to issuances outstanding under this program. We do not anticipate any new issuance activity under this program, given our December 2005 termination of the dealership agreement for this program and the availability of the program established in 2011 described below.

Additionally, we were authorized to issue up to $9.0 billion of funding agreements under a program that was originally established in March 2004 to support the prospective issuance of medium term notes by unaffiliated entities in both domestic and international markets. Under this program, both the notes and the supporting funding agreements were registered with the United States Securities and Exchange Commission (“SEC”). As of both December 31, 2019 and 2018, $26.2 million of liabilities were being held with respect to issuances outstanding under this program. In contrast with direct funding agreements, GIC issuances and the other three funding agreement backed medium term note programs described above, our payment obligations on each funding agreement issued under this SEC registered program are guaranteed by PFG. We do not anticipate any new issuance activity under this program due to the existence of the program established in 2011 described below.

We were authorized to issue up to $5.0 billion of funding agreements under a program that was originally established in 2011 to support the prospective issuance of medium term notes by an unaffiliated entity in both domestic and international markets. The unaffiliated entity is an unconsolidated special purpose entity. In June 2015, this program was amended to authorize issuance of up to an additional $4.0 billion in recognition of the use of nearly all $5.0 billion of existing issuance authorization. In November 2017, this program was amended to authorize issuance of up to an additional $4.0 billion. As of December 31, 2019 and 2018, $4,214.3 million and $3,765.3 million, respectively, of liabilities were being held with respect to issuances outstanding under this program. Similar to the SEC registered program, our payment obligations on each funding agreement issued under this program are guaranteed by PFG. The program established in 2011 is not registered with the SEC.

B-57

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Liability for Unpaid Claims

The liability for unpaid claims is reported in future policy benefits and claims within our consolidated statements of financial position. Activity associated with unpaid claims was as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Balance at beginning of year		$	2,252.7	$	2,130.5	$	2,001.3
Less: reinsurance recoverable			404.3		375.8		340.3
Net balance at beginning of year			1,848.4		1,754.7		1,661.0
Incurred:
	Current year		1,361.3		1,268.8		1,196.6
	Prior years		0.8		0.3		18.2
Total incurred			1,362.1		1,269.1		1,214.8
Payments:
	Current year		869.4		815.7		767.2
	Prior years		379.4		359.7		353.9
Total payments			1,248.8		1,175.4		1,121.1
Net balance at end of year			1,961.7		1,848.4		1,754.7
Plus: reinsurance recoverable			403.8		404.3		375.8
Balance at end of year		$	2,365.5	$	2,252.7	$	2,130.5
Amounts not included in the rollforward above:
	Claim adjustment expense liabilities	$	57.9	$	54.6	$	50.7

Incurred liability adjustments relating to prior years, which affected current operations during 2019, 2018 and 2017, resulted in part from developed claims for prior years being different than were anticipated when the liabilities for unpaid claims were originally estimated. These trends have been considered in establishing the current year liability for unpaid claims.

Short-Duration Contracts

Claims Development

The following tables present undiscounted information about claims development by incurral year, including separate information about incurred claims and paid claims net of reinsurance for the periods indicated. The tables also include information on incurred but not reported claims and the cumulative number of reported claims.

The tables present information for the number of years for which claims incurred typically remain outstanding, but do not exceed ten years. The data is disaggregated into groupings of claims with similar characteristics, such as duration of the claim payment period and average claim amount, and with consideration to the overall size of the groupings. Outstanding liabilities equal total net incurred claims less total net paid claims plus outstanding liabilities for net unpaid claims of prior years.

B-58

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

LTD and Group Life Waiver Claims

																							Incurred		Cumulative
																							but not		number of
																							reported		reported
			Net incurred claims (1)																				claims		claims
			December 31,
			2010		2011		2012		2013		2014		2015		2016		2017		2018		2019		2019		2019
			($ in millions)
Incurral
	year
	2010		$	184.1	$	176.7	$	176.2	$	172.0	$	162.7	$	155.7	$	154.1	$	153.4	$	152.1	$	151.8	$	0.1	5,649
	2011					203.7		192.6		185.4		184.8		178.4		172.3		169.6		167.6		166.5		0.1	6,290
	2012							217.9		200.0		191.1		189.5		181.8		174.8		173.3		171.9		0.1	6,444
	2013									219.3		203.3		188.4		190.7		182.3		179.5		177.1		0.1	7,050
	2014											242.2		231.4		214.4		218.1		206.2		201.9		0.1	7,596
	2015													231.0		227.2		217.2		215.3		208.2		0.1	7,174
	2016															229.8		228.4		219.4		219.5		5.4	6,161
	2017																	238.4		239.7		243.1		8.0	6,053
	2018																			239.4		245.1		3.8	5,668
	2019																					255.2		104.6	3,472
	Total net incurred claims																				$	2,040.3
			Net cumulative paid claims (1)
			December 31,
			2010		2011		2012		2013		2014		2015		2016		2017		2018		2019
			(in millions)
Incurral
	year
	2010		$	10.4	$	46.5	$	67.1	$	78.4	$	85.9	$	94.2	$	100.9	$	107.2	$	112.1	$	116.7
	2011					11.2		50.0		72.5		85.7		95.4		105.2		112.6		119.3		125.4
	2012							13.8		55.1		80.8		93.7		104.6		112.9		120.0		126.1
	2013									12.5		55.0		81.4		97.0		106.4		116.4		123.2
	2014											16.1		66.0		96.3		111.8		122.3		132.4
	2015													16.9		67.0		98.0		114.6		126.8
	2016															16.2		70.6		105.6		124.9
	2017																	17.8		76.5		115.0
	2018																			20.1		79.9
	2019																					19.2
	Total net paid claims																					1,089.6
	All outstanding liabilities for unpaid claims prior to 2010 net of reinsurance																					237.8
	Total outstanding liabilities for unpaid claims net of reinsurance																				$	1,188.5
		(1) 2010-2018 unaudited.

B-59

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Dental, Vision, STD, Critical Illness and Accident Claims

								Incurred	Cumulative
								but not	number of
								reported	reported
			Net incurred claims (1)					claims	claims
			December 31,
			2018		2019		2019		2019
			($ in millions)
Incurral year
	2018		$	648.3	$	640.0	$	—	3,032,617
	2019					724.7		45.0	3,184,519
	Total net incurred claims				$	1,364.7
			Net cumulative
			paid claims (1)
			December 31,
			2018		2019
			(in millions)
Incurral year
	2018		$	589.1	$	640.0
	2019					653.5
	Total net paid claims					1,293.5
	All outstanding liabilities for unpaid claims prior to 2018 net of
		reinsurance				—
	Total outstanding liabilities for unpaid claims net of reinsurance				$	71.2
	(1) 2018 unaudited.

Group Life Claims

								Incurred	Cumulative
								but not	number of
								reported	reported
			Net incurred claims (1)					claims	claims
			December 31,
			2018		2019		2019		2019
			($ in millions)
Incurral year
	2018		$	239.6	$	238.4	$	0.7	5,220
	2019					228.3		23.0	4,625
	Total net incurred claims				$	466.7
			Net cumulative
			paid claims (1)
			December 31,
			2018		2019
			(in millions)
Incurral year
	2018		$	193.9	$	236.5
	2019					181.7
	Total net paid claims					418.2
	All outstanding liabilities for unpaid claims prior to 2018 net of
		reinsurance				1.0
	Total outstanding liabilities for unpaid claims net of reinsurance				$	49.5
	(1) 2018 unaudited.

B-60

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Reconciliation of Unpaid Claims to Liability for Unpaid Claims

Our reconciliation of net outstanding liabilities for unpaid claims of short-duration contracts to the liability for unpaid claims follows:

		December 31, 2019
				Dental, Vision, STD,
		LTD and Group		Critical Illness and
		Life Waiver		Accident		Group Life		Consolidated
		(in millions)
Net outstanding liabilities for unpaid claims		$	1,188.5	$	71.2	$	49.5	$	1,309.2
Reconciling items:
	Reinsurance recoverable on unpaid claims		56.4		—		0.9		57.3
	Impact of discounting		(215.00)		—		—		(215.0)
Liability for unpaid claims - short-duration
	contracts	$	1,029.9	$	71.2	$	50.4		1,151.5
Insurance contracts other than short-duration									1,214.0
Liability for unpaid claims								$	2,365.5

Claim Duration and Payout

Our historical average percentage of claims paid in each year from incurral was as follows:

	December 31, 2019 (1)
			Dental, Vision, STD,
	LTD and Group Life		Critical Illness and
Year	Waiver		Accident		Group Life
1	7.6	%	91.7	%	81.7	%
2	24.2		8.0		17.0
3	14.9
4	8.1
5	5.6
6	5.3
7	4.2
8	3.9
9	3.5
10	3.1
(1) Unaudited.

B-61

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Discounting

The following table provides the carrying amount of liabilities reported at present value for short-duration contract unpaid claims. We use a range of discount rates to derive the present value of the unpaid claims. The ranges of discount rates as well as the aggregate amount of discount deducted to derive the liabilities for unpaid claims and interest accretion recognized are also disclosed. Interest accretion is included in benefits, claims and settlement expenses within our consolidated statements of operations.

								Dental, Vision, STD,
			LTD and Group					Critical Illness and
			Life Waiver					Accident					Group Life
			($ in millions)
Carrying amount of liabilities for unpaid claims
	December 31, 2019		$	1,029.9				$	71.2				$	50.4
	December 31, 2018			1,020.0					59.3					49.7
Range of discount rates
	December 31, 2019			3.3	-	7.0	%		—	-	—	%		—	-	—	%
	December 31, 2018			3.3	-	7.0			—	-	—			—	-	—
Aggregate amount of discount
	December 31, 2019		$	215.0				$	—				$	—
	December 31, 2018			217.7					—					—
Interest accretion
	For the year ended:
		December 31, 2019	$	34.2				$	—				$	—
		December 31, 2018		34.5					—					—
		December 31, 2017		35.0					—					—

11. Debt

Short-Term Debt

The components of short-term debt were as follows:

					December 31, 2019
		Financing					Short-term debt
Obligor/Applicant		structure		Maturity	Capacity		outstanding
					(in millions)
PFG, PFS, PLIC as co-borrowers		Credit facility		November 2023	$	600.0	$	—
PFG, PFS, PLIC and Principal Financial Services V
	(UK) LTD as co-borrowers	Credit facility		November 2023		200.0		—
		Unsecured
PLIC			line of credit	September 2020		60.0		—
Total					$	860.0	$	—
					December 31, 2018
		Financing					Short-term debt
Obligor/Applicant		structure		Maturity	Capacity		outstanding
					(in millions)
PFG, PFS, PLIC as co-borrowers		Credit facility		November 2023	$	600.0	$	—
PFG, PFS, PLIC and Principal Financial Services V
	(UK) LTD as co-borrowers	Credit facility		November 2023		200.0		—
		Unsecured
PLIC			line of credit	September 2019		60.0		—
Total					$	860.0	$	—

B-62

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Our revolving credit facilities are committed and available for general corporate purposes. These credit facilities also provide 100% back-stop support for our commercial paper program, of which we had no outstanding balances as of both December 31, 2019 and 2018.

Interest expense on intercompany debt was $0.0 million, $0.0 million and $0.6 million during 2019, 2018 and 2017, respectively.

Long-Term Debt

The components of long-term debt were as follows:

	December 31, 2019
			Net unamortized
				discount,
				premium and
				debt issuance		Carrying
	Principal			costs		amount
	(in millions)
Non-recourse mortgages and notes payable	$	107.7		$	1.0	$	108.7
Total long-term debt	$	107.7		$	1.0	$	108.7
	December 31, 2018
			Net unamortized
				discount,
				premium and
				debt issuance		Carrying
	Principal			costs		amount
	(in millions)
Non-recourse mortgages and notes payable	$	127.9		$	1.2	$	129.1
Total long-term debt	$	127.9		$	1.2	$	129.1

The non-recourse mortgages and notes payable are primarily financings for real estate developments. Outstanding principal balances as of December 31, 2019, ranged from $3.7 million to $64.2 million per development with interest rates ranging from 3.9% to 4.8%. Outstanding principal balances as of December 31, 2018, ranged from $3.8 million to $58.4 million per development with interest rates ranging from 3.9% to 4.8%. Outstanding debt is secured by the underlying real estate properties, which were reported as real estate on our consolidated statements of financial position with a carrying value of $238.2 million and $307.3 million as of December 31, 2019 and 2018, respectively.

As of December 31, 2019, future annual maturities of long-term debt were as follows (in millions):

Year ending December 31:
	2020	$	65.9
	2021		1.8
	2022		1.8
	2023		14.9
	2024		17.5
	Thereafter		6.8
	Total future maturities of long-term debt	$	108.7

B-63

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

12. Income Taxes

Income Taxes (Benefits)

Our income taxes (benefit) were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Current income taxes (benefits):
	U.S. federal	$	24.5	$	(29.7)	$	(36.8)
	State		8.0		2.0		45.7
	Foreign		—		(0.1)		0.1
	Tax benefit of operating loss carryforward		(0.3)		(0.2)		(0.1)
Total current income taxes (benefits)			32.2		(28.0)		8.9
Deferred income taxes (benefits):
	U.S. federal		113.2		174.8		(551.3)
	State		(5.2)		—		24.0
Total deferred income taxes (benefits)			108.0		174.8		(527.3)
Income taxes (benefits)		$	140.2	$	146.8	$	(518.4)

Our income before income taxes was as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Domestic		$	1,262.8	$	1,398.7	$	1,717.7
Foreign			—		2.4		0.3
	Total income before income taxes	$	1,262.8	$	1,401.1	$	1,718.0

Effective Income Tax Rate

Our provision for income taxes may not have the customary relationship of taxes to income. A reconciliation between the U.S. corporate income tax rate and the effective income tax rate was as follows:

	For the year ended December 31,
	2019		2018		2017
U.S. corporate income tax rate	21	%	21	%	35	%
Dividends received deduction	(6)		(5)		(10)
Tax credits	(4)		(3)		(3)
Interest exclusion from taxable income	(1)		(1)		(1)
Impact of the Tax Cuts and Jobs Act	—		(2)		(54)
Low income housing tax credit amortization	1		1		—
State income taxes	—		—		3
Other	—		(1)		—
Effective income tax rate	11	%	10	%	(30)	%

The U.S. tax reform enacted on December 22, 2017, made broad and complex changes to the U.S. Internal Revenue Code applicable to us. The U.S. statutory tax rate was reduced from 35% to 21% effective January 1, 2018. Other provisions of U.S. tax reform effective January 1, 2018, included, but were not limited to: 1) provisions reducing the dividends received deduction; 2) essentially eliminating U.S. federal income taxes on dividends from foreign subsidiaries; 3) retaining an element of current inclusion of certain earnings of controlled foreign corporations; 4) eliminating the corporate alternative minimum tax (“AMT”); and, 5) changing how existing AMT credits are realized.

B-64

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Unrecognized Tax Benefits

Our changes in unrecognized tax benefits were as follows:

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Balance at beginning of period		$	37.2	$	188.5	$	202.6
	Additions based on tax positions related to the current year		0.1		—		7.2
	Additions for tax positions of prior years		23.1		43.1		19.3
	Reductions for tax positions related to the current year		(3.2)		(10.6)		(3.4)
	Reductions for tax positions of prior years		—		(23.2)		(0.5)
	Settlements		—		(160.6)		(36.7)
Balance at end of period (1)		$	57.2	$	37.2	$	188.5

(1) There would be no impact to the effective income tax rate if the 2019 benefits were recognized. We recognize interest and penalties related to uncertain tax positions in operating expenses within the consolidated statements of operations.

As of December 31, 2019, 2018 and 2017, we had recognized $0.8 million, $1.3 million and $125.3 million of accumulated pre-tax interest and penalties related to unrecognized tax benefits, respectively. We do not believe there is a reasonable possibility the total amount of the unrecognized tax benefits will significantly increase or decrease in the next twelve months considering recent settlements and the status of current and pending Internal Revenue Service (“IRS”) examinations. Settlement agreements applicable to tax years 1995 to 2003 were executed in 2018 with the Department of Justice, as previously approved by the Joint Committee of Taxation in August 2017. In 2019, an IRS 30-day letter on examination of tax years 2009 through 2012 was received, and the IRS began its examination of tax years 2015 through 2017.

B-65

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Net Deferred Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Our significant components of net deferred income taxes were as follows:

			December 31,
			2019		2018
			(in millions)
Deferred income tax assets:
	Investments, including derivatives		$	190.9	$	122.6
	Insurance liabilities			62.9		—
	Net unrealized losses on available-for-sale securities			—		1.5
	Net operating and capital loss carryforwards			0.1		13.7
	Tax credit carryforwards			106.0		163.2
	Employee benefits			—		10.7
		Total deferred income tax assets		359.9		311.7
Deferred income tax liabilities:
	Deferred acquisition costs			(562.8)		(615.9)
	Investments, including derivatives			(362.0)		(238.3)
	Net unrealized gains on available-for-sale securities			(874.7)		—
	Real estate			(146.7)		(144.5)
	Insurance liabilities			—		(87.9)
	Intangible assets			(9.6)		(7.6)
	Gain on sale of discontinued operations (1)			(203.2)		(209.2)
	Employee benefits			(3.4)		—
	Other deferred income tax liabilities			(21.4)		(37.7)
		Total deferred income tax liabilities		(2,183.8)		(1,341.1)
		Total net deferred income tax liabilities	$	(1,823.9)	$	(1,029.4)

(1) Represents a deferred intercompany gain on the sale of PGI LLC to PFS, which was allocated to stockholder’s equity as the result of a taxable common control transaction on the standalone financials of the transferring entity. 

Our net deferred income taxes by jurisdiction were as follows:

		December 31,
		2019		2018
		(in millions)
Deferred income tax liabilities:
	U.S. federal	$	(1,795.2)	$	(999.1)
	State		(28.7)		(30.3)
Total net deferred income tax liabilities		$	(1,823.9)	$	(1,029.4)

In management’s judgment, total deferred income tax assets are more likely than not to be realized. Included in the deferred income tax asset are tax carryforwards available to offset future taxable income or income taxes.As of December 31, 2019 and 2018, we had tax credit carryforwards for U.S. federal income tax purposes of $106.0 million and $163.2 million, respectively. Alternative minimum and general business tax credit carryovers were generated during and since the period we utilized net operating losses, primarily attributable to our captive reinsurance companies that joined our consolidated U.S. federal income tax return beginning in 2012 and 2013. The AMT credit carryforwards became refundable in 2018 and will be fully recovered by 2021, and the other tax credits will expire by 2028 if unused. As of December 31, 2019, all accumulated U.S. federal tax credit carryforwards are anticipated to be utilized before expiration; therefore, no valuation allowance has been provided for the related deferred income tax assets.

B-66

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

As of December 31, 2019 and 2018, domestic state net operating loss carryforwards were $1.0 million and $4.7 million, respectively, and will expire between 2026 and 2036. As of December 31, 2019, all accumulated state net operating loss carryforwards are anticipated to be utilized before expiration; therefore, no valuation allowance has been provided for the related deferred income tax assets.

The effects of tax legislation on deferred taxes are recognized in the period of enactment. The primary impact of U.S. tax reform on our 2017 financial results was associated with the effect of reducing the U.S. statutory tax rate from 35% to 21% on our deferred tax balances as of December 31, 2017. The effects of the U.S. tax reform were reflected in the 2017 financial statements as determined or as reasonably estimated provisional amounts based on available information subject to interpretation in accordance with the SEC's Staff Accounting Bulletin No. 118. The provisional amounts apply in regard to potential technical interpretations of accounting and taxing authorities related to elements of the U.S. tax reform subject to change. The provisional amount was finalized within the one-year measurement period with no material adjustments.

Other Tax Information

Income tax returns are filed in the U.S. federal jurisdiction as well as various states and foreign jurisdictions where we and one or more of our subsidiaries conduct business. Although determined by jurisdiction, with few exceptions our tax uncertainties relate primarily to the U.S. federal jurisdiction. The IRS has completed examination of our consolidated U.S. federal income tax returns for years prior to 2009. A settlement was reached in 2018 with the Department of Justice involving a suit in the Court of Federal Claims, requesting refunds for the years 1995-2003. IRS claims for refund for tax years 2004 through 2008, following settlement of a partnership matter with the Department of Justice in March 2019, are expected to be finalized in 2020 following review by the Joint Committee of Taxation. As of December 31, 2019 and 2018, we had $196.6 million and $195.7 million, respectively, of current income tax receivables associated with outstanding audit issues reported as other assets in our consolidated statements of financial position.

PFG filed claims for refund for tax years 2006 through 2008 in 2015 and tax year 2012 in 2016. The IRS commenced audit of our U.S. federal income tax return for 2009 in the fourth quarter of 2011, 2010 in the first quarter of 2012, 2011 in the first quarter of 2013, 2012 in the third quarter of 2015 and 2015 through 2017 in the first quarter of 2019. The U.S. federal statute of limitations expired for years prior to 2009, except for pending audit issues. The statute was extended until December 31, 2020, for 2009 through 2012, has expired for 2013 and 2014, and was extended or remains open for tax years 2015 through 2017 through October 15, 2021. The ultimate settlement of earlier tax years can be adjusted into subsequent tax years regardless of statute status. We do not expect the results of these audits, subsequent related adjustments or developments in other tax areas for all open tax years to significantly change the possible increase in the amount of unrecognized tax benefits, but the outcome of tax reviews is uncertain and unforeseen results can occur.

We believe we have adequate defenses against, or sufficient provisions for, contested issues, but final resolution could take several years while legal remedies are pursued. Consequently, we do not expect the resolved issues from tax years 1995-2003 or those that might arise in tax years subsequent to 2003 to have a material impact on our net income.

13. Employee and Agent Benefits

PFG provides a U.S. qualified defined benefit pension plan, covering U.S. employees that meet certain eligibility requirements and certain agents contracted on or before December 31, 2018. A final average pay benefit formula has been in place for plan participants employed prior to January 1, 2002. For agents, this formula ended on December 31, 2018, and for employees the formula will end on December 31, 2022. The final average pay benefit is based on the years of service and generally the employee's or agent's average annual compensation during the last five years prior to the earliest of termination, retirement or the formula end date. A cash balance benefit was added on January 1, 2002. A participant's cash balance account is credited with an amount based on the participant’s salary, age and service. These credits accrue with interest. For plan participants hired on and after January 1, 2002, only the cash balance benefit applies. For pre-2002 participants, the pension benefit earned prior to the final average pay formula end date is the greater of the final average pay benefit or the cash balance benefit earned before the end date. They will also earn a new cash balance benefit for service after the formula end date. We reflect pension expense through our expense allocation agreement with PFG.

In addition, PFG sponsors non-qualified defined benefit plans subject to Section 409A of the Internal Revenue Code. This plan is for certain highly compensated employees and agents to replace the benefit that cannot be provided by the qualified defined benefit pension plan due to IRS limits. These nonqualified plans generally parallel the qualified plan but offer different payment options. No agent will become a new participant in the nonqualified plan after December 31, 2018.

B-67

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

We provide certain health care, life insurance and long-term care benefits for retired employees, their beneficiaries and covered dependents ("other postretirement benefits"). While virtually all U.S. employees continue to have access to the post-retirement health care and life insurance benefits, only those U.S. employees that were hired prior to January 1, 2002, and retired prior to January 1, 2011, (post-65 medical) or January 1, 2020, (life insurance and pre-65 medical) were eligible to receive subsidized benefits. All others pay the full cost of coverage. The long-term care plan was subsidized only for those who retired prior to January 1, 2000, and is no longer accessible. The subsidy level for all benefits varies by plan, age, service and retirement date. Our policy is to fund the cost of providing retiree benefits in the years the employees are providing service, taking into account the funded status of the trust. PFG is the sponsor of the post-65 retiree medical plan for both employees and individual field agents.

Obligations and Funded Status

The combined funded status, reconciled to amounts recognized in the consolidated statements of financial position relating to other postretirement employee benefit (“OPEB”) plan, was as follows:

	December 31,
	2019		2018
	(in millions)
Change in benefit obligation
Benefit obligation at beginning of year	$	(83.8)	$	(91.8)
Service cost		—		(0.1)
Interest cost		(3.2)		(2.9)
Actuarial gain (loss)		(3.6)		6.6
Participant contributions		(4.4)		(3.8)
Benefits paid		10.4		8.2
Plan amendments		(1.7)		—
Benefit obligation at end of year	$	(86.3)	$	(83.8)
Change in plan assets
Fair value of plan assets at beginning of year	$	618.7	$	668.3
Actual return on plan assets		91.6		(46.0)
Employer contribution		1.0		0.8
Participant contributions		4.4		3.8
Benefits paid		(10.4)		(8.2)
Fair value of plan assets at end of year	$	705.3	$	618.7
Amount recognized in statement of financial position
Other assets	$	622.8	$	536.8
Other liabilities		(3.8)		(1.9)
Total	$	619.0	$	534.9
Amount recognized in accumulated other comprehensive (income) loss
Total net actuarial (gain) loss	$	(12.0)	$	44.3
Prior service benefit		1.8		—
Pre-tax accumulated other comprehensive (income) loss	$	(10.2)	$	44.3

Other Postretirement Plan Changes and Plan Gains/Losses

For the year ended December 31, 2019, the other postretirement benefit plans had an actuarial loss primarily due to a decrease in the discount rate and a gain from actual and projected medical claims cost being lower than expected. For the year ended December 31, 2018, other postretirement benefit plans had an actuarial gain primarily due to an increase in the discount rate and a gain from actual and projected medical claims cost being lower than expected.

B-68

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Information for Other Postretirement Benefit Plans With an Accumulated Postretirement Benefit Obligation
in Excess of Plan Assets
	December 31,
	2019		2018
	(in millions)
Accumulated postretirement benefit obligation	$	3.8	$	2.1
Fair value of plan assets		—		0.2

Components of Other Postretirement Benefits Net Periodic Benefit Cost
	For the year ended December 31,
	2019		2018		2017
	(in millions)
Service cost	$	—	$	0.1	$	0.1
Interest cost		3.2		2.9		3.3
Expected return on plan assets		(32.0)		(32.2)		(26.2)
Amortization of prior service benefit		(0.1)		(12.8)		(33.4)
Recognized net actuarial (gain) loss		0.3		(1.2)		0.1
Net periodic benefit income	$	(28.6)	$	(43.2)	$	(56.1)

The components of net periodic benefit cost including the service cost component are included in operating expenses on the consolidated statements of operations.

For the other postretirement benefit plans, actuarial gains and losses were amortized with use of the corridors allowed.

For the other postretirement benefit plans, amounts recognized in pre-tax accumulated other comprehensive (income) loss were as follows:

		For the year ended December 31,
			2019		2018
		(in millions)
Other changes recognized in accumulated other comprehensive (income) loss
Net actuarial (gain) loss			$	(56.0)	$	71.6
Prior service cost				1.7		—
Amortization of gain (loss)				(0.3)		1.2
Amortization of prior service benefit				0.1		12.8
Total recognized in pre-tax accumulated other comprehensive (income) loss			$	(54.5)	$	85.6
Total recognized in net periodic benefit cost and pre-tax accumulated
	other comprehensive (income) loss		$	(83.1)	$	42.4

Net actuarial (gain) loss and net prior service cost benefit have been recognized in AOCI. The estimated net actuarial (gain) loss and prior service cost (benefit) for the postretirement benefits that will be amortized from AOCI into net periodic benefit cost during the2020 fiscal year are $(0.1) million and $(0.9) million, respectively.

Assumptions

Weighted‑average assumptions used for other postretirement benefit plans to determine benefit obligations as disclosed under the Obligations and Funded Status section

	For the year ended December 31,
	2019		2018
Discount rate	2.95	%	3.95	%
Rate of compensation increase	N/A		N/A

B-69

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Weighted average assumptions used for other postretirement benefit plans to determine net periodic benefit cost
	For the year ended December 31,
	2019		2018		2017
Discount rate	3.95	%	3.35	%	3.75	%
Expected long-term return on plan assets	5.20	%	4.85	%	4.40	%
Rate of compensation increase	N/A		2.39	%	2.44	%

For other postretirement benefits, the discount rate is determined by projecting future benefit payments inherent in the accumulated postretirement benefit obligation, and discounting those cash flows using a spot yield curve for high quality corporate bonds. The plans’ expected benefit payments are discounted to determine a present value using the yield curve and the discount rate is the level rate that produces the same present value. The 5.20% expected long-term return on plan assets for2019 was based on the weighted average expected long-term asset returns for the medical, life and long-term care plans. The expected long-term rates for the home office medical/life, agent medical/life and long-term care plans were 5.25%, 4.95% and 4.35%, respectively.

Assumed Health Care Cost Trend Rates Used to Determine Net Periodic Benefit Cost

	December 31,
	2019		2018
Health care cost trend rate assumed for next year under age 65	6.75	%	7.00	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)	4.50	%	4.50	%
Year that the rate reaches the ultimate trend rate (under age 65)	2029		2026

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

	1-percentage		1-percentage
	point increase		point decrease
		(in millions)
Effect on total of service cost and interest cost components	$	—	$	—
Effect on accumulated postretirement benefit obligation		(1.20)		1.1

Other Postretirement Benefit Plan Assets

Fair value is defined as the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date (an exit price). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels.

• Level 1 – Fair values are based on unadjusted quoted prices in active markets for identical assets.

• Level 2 – Fair values are based on inputs other than quoted prices within Level 1 that are observable for the asset, either directly or indirectly.

• Level 3 – Fair values are based on significant unobservable inputs for the asset.

Our other postretirement benefit plan assets consist of cash, investments in fixed income security portfolios, investments in equity security portfolios, investments in alternative mutual fund portfolios and investment in a real estate mutual fund. Because of the nature of cash, its carrying amount approximates fair value. The fair value of fixed income investment funds, U.S. equity portfolios and international equity portfolios is based on quoted prices in active markets for identical assets. The fair value of the alternative mutual fund portfolios and the real estate mutual fund are based on quoted market prices, which represent the net asset value (“NAV”) of shares held by the other postretirement benefit plan.

B-70

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

The fair value of the other postretirement benefit plans’ assets by asset category as of the most recent measurement date was as follows:

		December 31, 2019
		Assets		Fair value hierarchy level
		measured at
		fair value		Level 1		Level 2		Level 3
		(in millions)
Asset category
Cash and cash equivalents		$	0.6	$	0.6	$	—	$	—
Fixed income security portfolios:
	Fixed income investment funds (1)		355.8		316.4		39.4		—
U.S. equity portfolios (2)			245.6		201.4		44.2		—
International equity portfolios (3)			103.3		85.0		18.3		—
Total		$	705.3	$	603.4	$	101.9	$	—
		December 31, 2018
		Assets		Fair value hierarchy level
		measured at
		fair value		Level 1		Level 2		Level 3
		(in millions)
Asset category
Cash and cash equivalents		$	0.3	$	0.3	$	—	$	—
Fixed income security portfolios:
	Fixed income investment funds (1)		194.2		156.7		37.5		—
U.S. equity portfolios (2)			130.5		95.7		34.8		—
International equity portfolios (3)			57.6		43.8		13.8		—
Alternative mutual fund portfolios (4)			229.8		229.8		—		—
Real estate mutual fund (5)			6.3		6.3		—		—
Total		$	618.7	$	532.6	$	86.1	$	—

(1) The portfolios invest in various fixed income securities, primarily of U.S. origin. These include, but are not limited to, corporate bonds, residential mortgage-backed securities, commercial mortgage-backed securities, U.S. Treasury securities, agency securities, asset-backed securities and collateralized mortgage obligations.

(2) The portfolios invest primarily in publicly traded equity securities of large U.S. companies.

(3) The portfolios invest primarily in publicly traded equity securities of non-U.S. companies.

(4) The portfolios invest primarily in equities, corporate bonds, foreign currencies, convertible securities and derivatives.

(5) The mutual fund invests primarily in U.S. commercial real estate properties.

As of December 31, 2019 and 2018, $101.8 million and $86.1 million of assets, respectively, in cash, fixed income security portfolios, U.S. equity portfolios and international equity portfolios were included in a trust owned life insurance contract.

We have established an investment policy that provides the investment objectives and guidelines for the other postretirement benefit plans. Our investment strategy is to achieve the following:

• Obtain a reasonable long-term return consistent with the level of risk assumed and at a cost of operation within prudent levels. Performance benchmarks are monitored.

• Ensure sufficient liquidity to meet the emerging benefit liabilities for the plans.

• Provide for diversification of assets in an effort to avoid the risk of large losses and maximize the investment return to the other postretirement benefit plans consistent with market and economic risk.

In administering the other postretirement benefit plans’ asset allocation strategies, we consider the projected liability stream of benefit payments, the relationship between current and projected assets of the plan and the projected actuarial liabilities streams, the historical performance of capital markets adjusted for the perception of future short‑ and long-term capital market performance and the perception of future economic conditions.

B-71

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

According to our investment policy, the target asset allocation for the other postretirement benefit plans is:

Asset category	Target allocation
U.S. equity portfolios	35	%
International equity portfolios	15	%
Fixed income security portfolios	50	%

Estimated Future Benefit Payments

The estimated future benefit payments, which reflect expected future service are:

		Other postretirement
		benefits (gross benefit
		payments, including
		prescription drug benefits)
	(in millions)
Year ending December 31:
2020	$	11.4
2021		10.6
2022		10.0
2023		9.2
2024		8.5
2025-2029		25.4

The above table reflects the total estimated future benefits to be paid from the plan, including both our share of the benefit cost and the participants' share of the cost, which is funded by their contributions to the plan. The assumptions used in calculating the estimated future benefit payments are the same as those used to measure the benefit obligation for the year ended December 31, 2019.

14. Contingencies, Guarantees, Indemnifications and Leases

Litigation and Regulatory Contingencies

We are regularly involved in litigation, both as a defendant and as a plaintiff, but primarily as a defendant. Litigation naming us as a defendant ordinarily arises out of our business operations as a provider of asset management and accumulation products and services, individual life insurance, specialty benefits insurance and our investment activities. Some of the lawsuits may be class actions, or purport to be, and some may include claims for unspecified or substantial punitive and treble damages.

We may discuss such litigation in one of three ways. We accrue a charge to income and disclose legal matters for which the chance of loss is probable and for which the amount of loss can be reasonably estimated. We may disclose contingencies for which the chance of loss is reasonably possible and provide an estimate of the possible loss or range of loss or a statement that such an estimate cannot be made. Finally, we may voluntarily disclose loss contingencies for which the chance of loss is remote in order to provide information concerning matters that potentially expose us to possible losses.

In addition, regulatory bodies such as state insurance departments, the SEC, the Financial Industry Regulatory Authority, the Department of Labor and other regulatory agencies regularly make inquiries and conduct examinations or investigations concerning our compliance with, among other things, insurance laws, securities laws, Employee Retirement Income Security Act (“ERISA”) and laws governing the activities of broker-dealers. We receive requests from regulators and other governmental authorities relating to industry issues and may receive additional requests, including subpoenas and interrogatories, in the future.

B-72

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

On November 12, 2014, Frederick Rozo filed a class action lawsuit in the United States District Court for the Southern District of Iowa against us and PFG. PFG was later dismissed as a defendant. The Plaintiff alleged that defendants breached fiduciary duties and engaged in prohibited transactions under ERISA in connection with a general account guaranteed product known as the Principal Fixed Income Option (“PFIO”). On May 12, 2017, the district court certified a nationwide class of participants and beneficiaries who had funds invested in one of the PFIO contracts. On September 25, 2018, the district court granted our motion for summary judgment. On February 3, 2020, the Eighth Circuit Court of Appeals reversed that ruling and remanded the case back to the district court. We will continue to aggressively defend the case.

While the outcome of any pending or future litigation or regulatory matter cannot be predicted, management does not believe any such matter will have a material adverse effect on our business or financial position. As of December 31, 2019, we had no estimated loss accrued related to the legal matter discussed above because we believe the chance of loss from this matter is not probable and the amount of loss cannot be reasonably estimated.

To the extent such matters present a reasonably possible chance of loss, we are generally not able to estimate the possible loss or range of loss associated therewith. The outcome of such matters is always uncertain and unforeseen results can occur. It is possible that such outcomes could require us to pay damages or make other expenditures or establish accruals in amounts that we could not estimate at December 31, 2019.

Guarantees and Indemnifications

In the normal course of business, we have provided guarantees to our ultimate parent, PFG, related to benefit payments of the nonqualified pension plans and the nonqualified deferred compensation plans. We also provided guarantees to third parties primarily related to a former subsidiary. The terms of these agreements range in duration and often are not explicitly defined. The maximum exposure under these agreements as of December 31, 2019, was approximately $258.0 million. At inception, the fair value of such guarantees was insignificant. In addition, we believe the likelihood is remote that material payments will be required. Therefore, any liability accrued within our consolidated statements of financial position is insignificant. Should we be required to perform under these guarantees, we generally could recover a portion of the loss from third parties through recourse provisions included in agreements with such parties, the sale of assets held as collateral that can be liquidated in the event performance is required under the guarantees or other recourse generally available to us; therefore, such guarantees would not result in a material adverse effect on our business or financial position. While the likelihood is remote, such outcomes could materially affect net income in a particular quarter or annual period.

We are also subject to various other indemnification obligations issued in conjunction with divestitures, acquisitions and financing transactions whose terms range in duration and often are not explicitly defined. Certain portions of these indemnifications may be capped, while other portions are not subject to such limitations; therefore, the overall maximum amount of the obligation under the indemnifications cannot be reasonably estimated. At inception, the fair value of such indemnifications was insignificant. In addition, we believe the likelihood is remote that material payments will be required. Therefore, any liability accrued within our consolidated statements of financial position is insignificant. While we are unable to estimate with certainty the ultimate legal and financial liability with respect to these indemnifications, we believe that performance under these indemnifications would not result in a material adverse effect on our business or financial position. While the likelihood is remote, performance under these indemnifications could materially affect net income in a particular quarter or annual period.

Guaranty Funds

Under state insurance guaranty fund laws, insurers doing business in a state can be assessed, up to prescribed limits, for certain obligations of insolvent insurance companies to policyholders and claimants. A state’s fund assesses its members based on their pro rata market share of written premiums in the state for the classes of insurance for which the insolvent insurer was engaged. Some states permit member insurers to recover assessments paid through full or partial premium tax offsets. We accrue liabilities for guaranty fund assessments when an assessment is probable, can be reasonably estimated and when the event obligating us to pay has occurred. While we cannot predict the amount and timing of any future assessments, we have established reserves we believe are adequate for assessments relating to insurance companies that are currently subject to insolvency proceedings. As of December 31, 2019 and 2018, the liability balance for guaranty fund assessments, which is not discounted, was $21.7 million and $22.2 million, respectively, and was reported within other liabilities in the consolidated statements of financial position. As of December 31, 2019 and 2018, $10.0 million and $10.4 million, respectively, related to premium tax offsets were included in premiums due and other receivables in the consolidated statements of financial position.

B-73

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Leases

As a lessee, we lease office space, data processing equipment, office furniture and office equipment under various operating leases. We also lease buildings and hardware storage equipment under finance leases. Lease assets and liabilities are recognized at the commencement of a lease based on the present value of lease payments over the lease term. We generally use our incremental borrowing rate based on the information available at the lease commencement date to determine the present value of lease payments. Lease term may include options to extend or terminate the lease when it is reasonably certain we will exercise the option. Leases with an initial term of twelve months or less are not recorded on the consolidated statements of financial position. We recognize lease expense for leases on a straight-line basis over the lease term. Some of our lease agreements include payments for property taxes, insurance, utilities or common area maintenance, which are not based on an index or rate. These payments are recognized in net income in the period in which the obligation has occurred.

We sublease certain office space to third parties, which are primarily operating leases. We record sublease income on a straight-line basis over the lease term.

The lease assets and liabilities were as follows:

	December 31, 2019
	(in millions)
Assets
Operating lease assets (1)	$	92.9
Finance lease assets (1)		31.0
Total lease assets	$	123.9
Liabilities
Operating lease liabilities (2)	$	94.0
Finance lease liabilities (2)		31.4
Total lease liabilities	$	125.4

(1) Operating and finance lease assets are primarily reported within property and equipment on the consolidated statements of financial position.

(2) Operating and finance lease liabilities are reported within other liabilities on the consolidated statements of

financial position.

As of December 31, 2018, we had capital lease assets of $31.9 million.

The lease cost was as follows:

		For the year ended
		December 31, 2019
		(in millions)
Finance lease cost (1):
	Amortization of right-of-use assets	$	14.5
	Interest on lease liabilities		1.0
Operating lease cost (1)			29.4
Other lease cost (1) (2)			5.0
Sublease income (3)			(1.7)
Total lease cost		$	48.2

(1) Finance, operating and other lease costs are primarily included in operating expenses on the consolidated statements of operations.

(2) Other lease cost primarily reflects variable and short-term lease costs.

(3) Sublease income is included in fees and other revenues on the consolidated statements of operations.

B-74

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Rental expense for operating leases for the years ended December 31, 2018 and 2017, was $17.1 million and $23.0 million, respectively. Depreciation expense for capital leases for both the years ended December 31, 2018 and 2017, was $9.9 million.

Payments for operating leases and finance leases for the year ended December 31, 2019, were $31.6 million and $15.1 million, respectively. The following represents future payments due by period for lease obligations:

		Operating leases		Finance leases			Total
		(in millions)
For the twelve months ending December 31:
2020		$	27.5	$	14.7	$	42.2
2021			22.5		11.6		34.1
2022			16.1		3.8		19.9
2023			10.5		1.9		12.4
2024			6.6		0.5		7.1
2025 and thereafter			24.7		—		24.7
	Total lease payments		107.9		32.5		140.4
	Less: interest		13.9		1.1		15.0
	Present value of lease liabilities	$	94.0	$	31.4	$	125.4

The weighted-average remaining lease term and weighted-average discount rates were as follows:

		For the year ended
		December 31, 2019
Weighted-average remaining lease term (in years):
	Operating leases	7.6
	Finance leases	2.6
Weighted-average discount rate:
	Operating leases	3.1	%
	Finance leases	2.7	%

B-75

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

15. Stockholder's Equity

Other Comprehensive Income (Loss)
		For the year ended December 31, 2019
		Pre-Tax		Tax		After-Tax
		(in millions)
Net unrealized gains on available-for-sale securities during the period		$	4,107.0	$	(865.2)	$	3,241.8
Reclassification adjustment for losses included in net income (1)			51.0		(10.6)		40.4
Adjustments for assumed changes in amortization patterns			(293.0)		61.5		(231.5)
Adjustments for assumed changes in policyholder liabilities			(654.4)		137.4		(517.0)
Net unrealized gains on available-for-sale securities			3,210.6		(676.9)		2,533.7
Noncredit component of impairment losses on fixed maturities,
	available-for-sale during the period		5.2		(1.1)		4.1
Adjustments for assumed changes in amortization patterns			(1.4)		0.3		(1.1)
Noncredit component of impairment losses on fixed maturities,
	available-for-sale (2)		3.8		(0.8)		3.0
Net unrealized losses on derivative instruments during the period			(0.5)		—		(0.5)
Reclassification adjustment for gains included in net income (3)			(28.7)		6.1		(22.6)
Adjustments for assumed changes in amortization patterns			3.1		(0.6)		2.5
Adjustments for assumed changes in policyholder liabilities			7.9		(1.9)		6.0
Net unrealized losses on derivative instruments			(18.2)		3.6		(14.6)
Unrecognized postretirement benefit obligation during the period			54.3		(11.4)		42.9
Amortization of amounts included in net periodic benefit cost (4)			0.2		—		0.2
Net unrecognized postretirement benefit obligation			54.5		(11.4)		43.1
Other comprehensive income		$	3,250.7	$	(685.5)	$	2,565.2

B-76

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

		For the year ended December 31, 2018
		Pre-Tax		Tax		After-Tax
		(in millions)
Net unrealized losses on available-for-sale securities during the period		$	(2,534.3)	$	526.0	$	(2,008.3)
Reclassification adjustment for losses included in net income (1)			84.4		(13.6)		70.8
Adjustments for assumed changes in amortization patterns			185.9		(39.1)		146.8
Adjustments for assumed changes in policyholder liabilities			351.1		(73.7)		277.4
Net unrealized losses on available-for-sale securities			(1,912.9)		399.6		(1,513.3)
Noncredit component of impairment losses on fixed maturities,
	available-for-sale during the period		39.7		(8.3)		31.4
Adjustments for assumed changes in amortization patterns			(5.3)		1.1		(4.2)
Adjustments for assumed changes in policyholder liabilities			(0.8)		0.1		(0.7)
Noncredit component of impairment losses on fixed maturities,
	available-for-sale (2)		33.6		(7.1)		26.5
Net unrealized gains on derivative instruments during the period			50.4		(3.6)		46.8
Reclassification adjustment for gains included in net income (3)			(50.8)		7.1		(43.7)
Adjustments for assumed changes in amortization patterns			0.3		(0.1)		0.2
Adjustments for assumed changes in policyholder liabilities			5.7		(1.0)		4.7
Net unrealized gains on derivative instruments			5.6		2.4		8.0
Unrecognized postretirement benefit obligation during the period			(71.6)		15.1		(56.5)
Amortization of amounts included in net periodic benefit cost (4)			(14.0)		2.9		(11.1)
Net unrecognized postretirement benefit obligation			(85.6)		18.0		(67.6)
Other comprehensive loss		$	(1,959.3)	$	412.9	$	(1,546.4)
		For the year ended December 31, 2017
		Pre-Tax		Tax		After-Tax
		(in millions)
Net unrealized gains on available-for-sale securities during the period		$	1,028.5	$	(325.0)	$	703.5
Reclassification adjustment for losses included in net income (1)			65.6		(22.8)		42.8
Adjustments for assumed changes in amortization patterns			(26.2)		9.3		(16.9)
Adjustments for assumed changes in policyholder liabilities			(168.5)		59.0		(109.5)
Net unrealized gains on available-for-sale securities			899.4		(279.5)		619.9
Noncredit component of impairment losses on fixed maturities,
	available-for-sale during the period		49.7		(17.4)		32.3
Adjustments for assumed changes in amortization patterns			(6.4)		2.3		(4.1)
Adjustments for assumed changes in policyholder liabilities			(1.3)		0.5		(0.8)
Noncredit component of impairment losses on fixed maturities,
	available-for-sale (2)		42.0		(14.6)		27.4
Net unrealized losses on derivative instruments during the period			(46.7)		16.0		(30.7)
Reclassification adjustment for gains included in net income (3)			(42.4)		15.1		(27.3)
Adjustments for assumed changes in amortization patterns			3.9		(1.3)		2.6
Adjustments for assumed changes in policyholder liabilities			9.6		(3.3)		6.3
Net unrealized losses on derivative instruments			(75.6)		26.5		(49.1)
Unrecognized postretirement benefit obligation during the period			44.2		(9.2)		35.0
Amortization of amounts included in net periodic benefit cost (4)			(33.3)		11.6		(21.7)
Net unrecognized postretirement benefit obligation			10.9		2.4		13.3
Other comprehensive income		$	876.7	$	(265.2)	$	611.5

B-77

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in net realized capital gains (losses) on the consolidated statements of operations.

(2) Represents the net impact of (1) unrealized gains resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold and (2) unrealized losses resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI.

(3) See Note 7, Derivative Financial Instruments, under the caption “Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations” for further details.

(4) Amount is comprised of amortization of prior service cost (benefit) and recognized net actuarial (gain) loss, which is reported in operating expenses on the consolidated statements of operations. See Note 13, Employee and Agent Benefits, under the caption “Components of Net Periodic Benefit Cost” for further details.

Accumulated Other Comprehensive Income
				Noncredit
		Net unrealized		component of		Net unrealized		Foreign		Unrecognized		Accumulated
		gains on		impairment losses		gains on		currency		postretirement		other
		available-for-sale		on fixed maturities		derivative		translation		benefit		comprehensive
		securities		available-for-sale		instruments		adjustment		obligation		income
		(in millions)
Balances as of January 1, 2017		$	713.6	$	(85.8)	$	101.7	$	(0.9)	$	19.8	$	748.4
Other comprehensive income
	during the period, net of
	adjustments		577.1		—		(21.8)		—		35.0		590.3
Amounts reclassified from AOCI			42.8		27.4		(27.3)		—		(21.7)		21.2
Other comprehensive income			619.9		27.4		(49.1)		—		13.3		611.5
Sale of subsidiary to parent, net of
	related income taxes, as part of a
	common control transaction		—		—		—		(0.1)		—		(0.1)
Balances as of December 31, 2017			1,333.5		(58.4)		52.6		(1.0)		33.1		1,359.8
Other comprehensive loss
	during the period, net of
	adjustments		(1,584.1)		—		51.7		—		(56.5)		(1,588.9)
Amounts reclassified from AOCI			70.8		26.5		(43.7)		—		(11.1)		42.5
Other comprehensive loss			(1,513.3)		26.5		8.0		—		(67.6)		(1,546.4)
Effects of implementation of
	accounting change related to
	equity investments, net		0.1		—		—		—		—		0.1
Effects of implementation of
	accounting change related to
	the reclassification of certain
	tax effects, net		248.9		(15.2)		7.7		1.0		(0.4)		242.0
Balances as of December 31, 2018			69.2		(47.1)		68.3		—		(34.9)		55.5
Other comprehensive income
	during the period, net of
	adjustments		2,493.3		—		8.0		—		42.9		2,544.2
Amounts reclassified from AOCI			40.4		3.0		(22.6)		—		0.2		21.0
Other comprehensive income			2,533.7		3.0		(14.6)		—		43.1		2,565.2
Balances as of December 31, 2019		$	2,602.9	$	(44.1)	$	53.7	$	—	$	8.2	$	2,620.7

B-78

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Dividend Limitations

Under Iowa law, we may pay dividends only from the earned surplus arising from our business and must receive the prior approval of the Commissioner of Insurance of the State of Iowa (“the Commissioner”) to pay stockholder dividends or make any other distribution if such distribution would exceed certain statutory limitations. Iowa law gives the Commissioner discretion to disapprove requests for distributions in excess of these limitations. Extraordinary dividends include those made, together with dividends and other distributions, within the preceding twelve months that exceed the greater of (i) 10% of our statutory policyholder surplus as of the previous year-end or (ii) the statutory net gain from operations from the previous calendar year, not to exceed earned surplus. Based on this limitation and 2019 statutory results, our dividend limitation is approximately $1,060.3 million in ordinary stockholder dividends in 2020 without prior regulatory approval. However, because the dividend test is based on dividends previously paid over rolling 12-month periods, if paid before a specified date during 2020, some or all of such dividends may be extraordinary and require regulatory approval.

On May 1, 2017, we sold our ownership interest in PGI LLC to PFS in connection with a corporate reorganization designed to better utilize and allocate capital internally. Subsequent to the sale, we paid an extraordinary dividend of $1,068.4 million to PFS with the cash proceeds received from the sale, which was approved by the Commissioner.

16. Fair Value Measurements

We use fair value measurements to record fair value of certain assets and liabilities and to estimate fair value of financial instruments not recorded at fair value but required to be disclosed at fair value. Certain financial instruments, particularly policyholder liabilities other than investment contracts, are excluded from these fair value disclosure requirements.

Valuation Hierarchy

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels. The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety considering factors specific to the asset or liability.

• Level 1 – Fair values are based on unadjusted quoted prices in active markets for identical assets or liabilities.

• Level 2 – Fair values are based on inputs other than quoted prices within Level 1 that are observable for the asset or liability, either directly or indirectly.

• Level 3 – Fair values are based on at least one significant unobservable input for the asset or liability.

Determination of Fair Value

The following discussion describes the valuation methodologies and inputs used for assets and liabilities measured at fair value on a recurring basis or disclosed at fair value. The techniques utilized in estimating the fair value of financial instruments are reliant on the assumptions used. Care should be exercised in deriving conclusions about our business, its value or financial position based on the fair value information of financial instruments presented below.

Fair value estimates are made based on available market information and judgments about the financial instrument at a specific point in time. Such estimates do not consider the tax impact of the realization of unrealized gains or losses. In addition, the disclosed fair value may not be realized in the immediate settlement of the financial instrument. We validate prices through an investment analyst review process, which includes validation through direct interaction with external sources, review of recent trade activity or use of internal models. In circumstances where broker quotes are used to value an instrument, we generally receive one non-binding quote. Broker quotes are validated through an investment analyst review process, which includes validation through direct interaction with external sources and use of internal models or other relevant information. We did not make any significant changes toour valuation processes during2019.

B-79

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Fixed Maturities

Fixed maturities include bonds, ABS, redeemable preferred stock and certain non-redeemable preferred securities. When available, the fair value of fixed maturities is based on quoted prices of identical assets in active markets. These are reflected in Level 1 and primarily include U.S. Treasury bonds and actively traded redeemable corporate preferred securities.

When quoted prices of identical assets in active markets are not available, our first priority is to obtain prices from third party pricing vendors. We have regular interaction with these vendors to ensure we understand their pricing methodologies and to confirm they are utilizing observable market information. Their methodologies vary by asset class and include inputs such as estimated cash flows, benchmark yields, reported trades, broker quotes, credit quality, industry events and economic events. Fixed maturities with validated prices from pricing services, which includes the majority of our public fixed maturities in all asset classes, are generally reflected in Level 2. Also included in Level 2 are corporate bonds when quoted market prices are not available, for which an internal model using substantially all observable inputs or a matrix pricing valuation approach is used. In the matrix approach, securities are grouped into pricing categories that vary by sector, rating and average life. Each pricing category is assigned a risk spread based on studies of observable public market data from the investment professionals assigned to specific security classes. The expected cash flows of the security are then discounted back at the current Treasury curve plus the appropriate risk spread. Although the matrix valuation approach provides a fair valuation of each pricing category, the valuation of an individual security within each pricing category may also be impacted by company specific factors.

If we are unable to price a fixed maturity security using prices from third party pricing vendors or other sources specific to the asset class, we may obtain a broker quote or utilize an internal pricing model specific to the asset utilizing relevant market information, to the extent available and where at least one significant unobservable input is utilized. These are reflected in Level 3 in the fair value hierarchy and can include fixed maturities across all asset classes. As of December 31, 2019, less than 1% of our total fixed maturities were Level 3 securities valued using internal pricing models.

The primary inputs, by asset class, for valuations of the majority of our Level 2 investments from third party pricing vendors or our internal pricing valuation approach are described below.

U.S. Government and Agencies/Non-U.S. Governments. Inputs include recently executed market transactions, interest rate yield curves, maturity dates, market price quotations and credit spreads relating to similar instruments.

States and Political Subdivisions. Inputs include Municipal Securities Rulemaking Board reported trades, U.S. Treasury and other benchmark curves, material event notices, new issue data and obligor credit ratings.

Corporate. Inputs include recently executed transactions, market price quotations, benchmark yields, issuer spreads and observations of equity and credit default swap curves related to the issuer. For private placement corporate securities valued through the matrix valuation approach inputs include the current Treasury curve and risk spreads based on sector, rating and average life of the issuance.

RMBS, CMBS, Collateralized Debt Obligations and Other Debt Obligations. Inputs include cash flows, priority of the tranche in the capital structure, expected time to maturity for the specific tranche, reinvestment period remaining and performance of the underlying collateral including prepayments, defaults, deferrals, loss severity of defaulted collateral and, for RMBS, prepayment speed assumptions. Other inputs include market indices and recently executed market transactions.

Equity Securities

Equity securities include mutual funds, common stock and non-redeemable preferred stock. Fair values of equity securities are determined using quoted prices in active markets for identical assets when available, which are reflected in Level 1. When quoted prices are not available, we may utilize internal valuation methodologies appropriate for the specific asset that use observable inputs such as underlying share prices or the NAV, which are reflected in Level 2. Fair values might also be determined using broker quotes or through the use of internal models or analysis that incorporate significant assumptions deemed appropriate given the circumstances and consistent with what other market participants would use when pricing such securities, which are reflected in Level 3. 

B-80

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Derivatives

The fair values of exchange-traded derivatives are determined through quoted market prices, which are reflected in Level 1. Exchange-traded derivatives include futures that are settled daily, which reduces their fair value in the consolidated statements of financial position. The fair values of OTC cleared derivatives are determined through market prices published by the clearinghouses, which are reflected in Level 2. The clearinghouses may utilize the overnight indexed swap (“OIS”) curve in their valuation. Variation margin associated with OTC cleared derivatives is settled daily, which reduces their fair value in the consolidated statements of financial position. The fair values of bilateral OTC derivative instruments are determined using either pricing valuation models that utilize market observable inputs or broker quotes. The majority of our bilateral OTC derivatives are valued with models that use market observable inputs, which are reflected in Level 2. Significant inputs include contractual terms, interest rates, currency exchange rates, credit spread curves, equity prices and volatilities. These valuation models consider projected discounted cash flows, relevant swap curves and appropriate implied volatilities. Certain bilateral OTC derivatives utilize unobservable market data, primarily independent broker quotes that are nonbinding quotes based on models that do not reflect the result of market transactions, which are reflected in Level 3.

Our non-cleared derivative contracts are generally documented under ISDA Master Agreements, which provide for legally enforceable set-off and close-out netting of exposures to specific counterparties. Collateral arrangements are bilateral and based on current ratings of each entity. We utilize the LIBOR interest rate curve to value our positions, which includes a credit spread. This credit spread incorporates an appropriate level of nonperformance risk into our valuations given the current ratings of our counterparties, as well as the collateral agreements in place. Counterparty credit risk is routinely monitored to ensure our adjustment for non-performance risk is appropriate. Our centrally cleared derivative contracts are conducted with regulated centralized clearinghouses, which provide for daily exchange of cash collateral or variation margin equal to the difference in the daily market values of those contracts that eliminates the non-performance risk on these trades.

Interest Rate Contracts. For non-cleared contracts we use discounted cash flow valuation techniques to determine the fair value of interest rate swaps and swaptions using observable swap curves as the inputs. These are reflected in Level 2. For centrally cleared contracts we use published prices from clearinghouses. These are reflected in Level 2. In addition, we have interest rate options and have had swaptions that are valued using broker quotes. These are reflected in Level 3.

Foreign Exchange Contracts. We use discounted cash flow valuation techniques that utilize observable swap curves and exchange rates as the inputs to determine the fair value of foreign currency swaps. These are reflected in Level 2. In addition, we have a limited number of non-standard currency swaps that are valued using broker quotes. These are reflected within Level 3.

Equity Contracts. We use an option pricing model using observable implied volatilities, dividend yields, index prices and swap curves as the inputs to determine the fair value of equity options. These are reflected in Level 2.

Credit Contracts. We use either the ISDA Credit Default Swap Standard discounted cash flow model that utilizes observable default probabilities and recovery rates as inputs or broker prices to determine the fair value of credit default swaps. These are reflected in Level 3.

Other Investments

Other investments reported at fair value include investment funds reported at fair value, commercial mortgage loans of consolidated VIEs for which the fair value option was elected, equity method real estate investments for which the fair value option was elected and certain redeemable and nonredeemable preferred stock. In addition, in 2017 we had other investment funds for which the fair value option was elected.

The fair value of investment funds is determined using the NAV of the fund. The NAV of the fund represents the price at which we would be able to initiate a transaction. Investments for which the NAV represents a quoted price in an active market for identical assets are reflected in Level 1. Investments that do not have a quoted price in an active market are reflected in Level 2.

Commercial mortgage loans of a consolidated VIE were valued using the more observable fair value of the liabilities of the consolidated collateralized financing entity (“CCFE”) under the measurement alternative guidance and were reflected in Level 2. The liabilities were affiliated so were not reflected in our consolidated results. The trust was unwound in the third quarter of 2019.

B-81

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Equity method real estate investments for which the fair value option was elected are reflected in Level 3. The equity method real estate investments consist of underlying real estate and debt. The real estate fair value is estimated using a discounted cash flow valuation model that utilizes public real estate market data inputs such as transaction prices, market rents, vacancy levels, leasing absorption, market cap rates and discount rates. The debt fair value is estimated using a discounted cash flow analysis based on our incremental borrowing rate for similar borrowing arrangements.

The fair value of certain redeemable and nonredeemable preferred stock is based on an internal model using unobservable inputs, which is reflected in Level 3. In 2018, the fair value of redeemable preferred stock was based on observable inputs and was reflected in Level 2.

Cash Equivalents

Certain cash equivalents are reported at fair value on a recurring basis and include money market instruments and other short-term investments with maturities of three months or less. Fair values of these cash equivalents may be determined using public quotations, when available, which are reflected in Level 1. When public quotations are not available, because of the highly liquid nature of these assets, carrying amounts may be used to approximate fair values, which are reflected in Level 2.

Separate Account Assets

Separate account assets include equity securities, debt securities, cash equivalents and derivative instruments, for which fair values are determined as previously described, and are reflected in Level 1, Level 2 and Level 3. Separate account assets also include commercial mortgage loans, for which the fair value is estimated by discounting the expected total cash flows using market rates that are applicable to the yield, credit quality and maturity of the loans. The market clearing spreads vary based on mortgage type, weighted average life, rating and liquidity. These are reflected in Level 3. Finally, separate account assets include real estate, for which the fair value is estimated using discounted cash flow valuation models that utilize various public real estate market data inputs. In addition, each property is appraised annually by an independent appraiser. The real estate included in separate account assets is recorded net of related mortgage encumbrances for which the fair value is estimated using discounted cash flow analysis based on our incremental borrowing rate for similar borrowing arrangements. The real estate within the separate accounts is reflected in Level 3.

Investment and Universal Life Contracts

Certain universal life, annuity and other investment contracts include embedded derivatives that have been bifurcated from the host contract and are measured at fair value on a recurring basis, which are reflected in Level 3. The key assumptions for calculating the fair value of the embedded derivative liabilities are market assumptions (such as equity market returns, interest rate levels, market volatility and correlations) and policyholder behavior assumptions (such as lapse, mortality, utilization and withdrawal patterns). Risk margins are included in the policyholder behavior assumptions. The assumptions are based on a combination of historical data and actuarial judgment. The embedded derivative liabilities are valued using models that incorporate a spread reflecting our own creditworthiness. 

The assumption for our own non-performance risk for investment contracts and any embedded derivatives bifurcated from certain universal life, annuity and investment contracts is based on the current market credit spreads for debt-like instruments we have issued and are available in the market.

Other Liabilities

Certain obligations reported in other liabilities include embedded derivatives to deliver underlying securities of structured investments to third parties. The fair value of the embedded derivatives is calculated based on the value of the underlying securities that are valued based on prices obtained from third party pricing vendors as utilized and described in our discussion of how fair value is determined for fixed maturities, which are reflected in Level 2.

Certain obligations of consolidated VIEs for which the fair value option was elected were included in other liabilities. The synthetic entity that had these obligations matured in the first quarter of 2017. The VIEs’ unaffiliated obligations were valued utilizing internal pricing models, which were reflected in Level 3.

B-82

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis were as follows:

	December 31, 2019
	Assets/		Amount
	(liabilities)		measured at		Fair value hierarchy level
	measured at		net asset
	fair value		value (4)		Level 1		Level 2		Level 3
	(in millions)
Assets
Fixed maturities, available-for-sale:
U.S. government and agencies	$	1,656.9	$	—	$	1,277.4	$	379.5	$	—
Non-U.S. governments		853.0		—		—		853.0		—
States and political subdivisions		7,419.4		—		—		7,419.4		—
Corporate		37,111.1		—		18.5		37,010.9		81.7
Residential mortgage-backed securities		2,844.2		—		—		2,844.2		—
Commercial mortgage-backed securities		4,802.7		—		—		4,789.8		12.9
Collateralized debt obligations (1)		3,211.2		—		—		3,012.2		199.0
Other debt obligations		8,084.9		—		—		7,993.6		91.3
Total fixed maturities, available-for-sale		65,983.4		—		1,295.9		64,302.6		384.9
Fixed maturities, trading		237.6		—		0.5		236.8		0.3
Equity securities		69.9		—		26.5		43.4		—
Derivative assets (2)		279.6		—		—		251.7		27.9
Other investments		112.5		78.3		—		—		34.2
Cash equivalents		729.3		—		—		729.3		—
Sub-total excluding separate account
assets		67,412.3		78.3		1,322.9		65,563.8		447.3
Separate account assets		125,801.7		129.0		95,419.5		21,286.5		8,966.7
Total assets	$	193,214.0	$	207.3	$	96,742.4	$	86,850.3	$	9,414.0
Liabilities
Investment and universal life contracts (3)	$	(151.2)	$	—	$	—	$	—	$	(151.2)
Derivative liabilities (2)		(147.0)		—		—		(130.7)		(16.3)
Other liabilities (3)		(98.7)		—		—		(98.7)		—
Total liabilities	$	(396.9)	$	—	$	—	$	(229.4)	$	(167.5)
Net assets	$	192,817.1	$	207.3	$	96,742.4	$	86,620.9	$	9,246.5

B-83

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

	December 31, 2018
	Assets/		Amount
	(liabilities)		measured at		Fair value hierarchy level
	measured at		net asset
	fair value		value (4)		Level 1		Level 2		Level 3
	(in millions)
Assets
Fixed maturities, available-for-sale:
U.S. government and agencies	$	1,383.2	$	—	$	993.1	$	390.1	$	—
Non-U.S. governments		730.8		—		—		726.2		4.6
States and political subdivisions		6,165.7		—		—		6,165.7		—
Corporate		32,088.4		—		19.2		32,011.3		57.9
Residential mortgage-backed securities		2,416.2		—		—		2,416.2		—
Commercial mortgage-backed securities		3,902.8		—		—		3,893.3		9.5
Collateralized debt obligations (1)		2,416.9		—		—		2,408.6		8.3
Other debt obligations		7,171.3		—		—		7,112.8		58.5
Total fixed maturities, available-for-sale		56,275.3		—		1,012.3		55,124.2		138.8
Fixed maturities, trading		165.5		—		—		165.5		—
Equity securities		84.8		—		46.6		38.2		—
Derivative assets (2)		172.6		—		—		154.0		18.6
Other investments		109.0		75.4		—		16.4		17.2
Cash equivalents		945.8		—		—		945.8		—
Sub-total excluding separate account
assets		57,753.0		75.4		1,058.9		56,444.1		174.6
Separate account assets		107,343.0		124.6		79,303.1		19,471.3		8,444.0
Total assets	$	165,096.0	$	200.0	$	80,362.0	$	75,915.4	$	8,618.6
Liabilities
Investment and universal life contracts (3)	$	(5.3)	$	—	$	—	$	—	$	(5.3)
Derivative liabilities (2)		(104.4)		—		—		(89.3)		(15.1)
Other liabilities (3)		(89.3)		—		—		(89.3)		—
Total liabilities	$	(199.0)	$	—	$	—	$	(178.6)	$	(20.4)
Net assets	$	164,897.0	$	200.0	$	80,362.0	$	75,736.8	$	8,598.2

(1) Primarily consists of collateralized loan obligations backed by secured corporate loans.

(2) Within the consolidated statements of financial position, derivative assets are reported with other investments and derivative liabilities are reported with other liabilities. The amounts are presented gross in the tables above to reflect the presentation on the consolidated statements of financial position; however, are presented net for purposes of the rollforward in the Changes in Level 3 Fair Value Measurements tables. Refer to Note 7, Derivative Financial Instruments, for further information on fair value by class of derivative instruments.

(3) Includes bifurcated embedded derivatives that are reported at net asset (liability) fair value within the same line item in the consolidated statements of financial position in which the host contract is reported.

(4)Certain investments are measured at fair value using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy. Other investments using the NAV practical expedient consist of certain fund interests that are restricted until maturity with unfunded commitments totaling $19.9 million and $32.0 million as of December 31, 2019 and December 31, 2018, respectively. Separate account assets using the NAV practical expedient consist of hedge funds with varying investment strategies that also have a variety of redemption terms and conditions. We do not have unfunded commitments associated with these hedge funds.

B-84

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Changes in Level 3 Fair Value Measurements

The reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) was as follows:

			For the year ended December 31, 2019
																	Changes in
			Beginning		Total realized/unrealized				Net						Ending		unrealized
			asset/		gains (losses)				purchases,						asset/		gains (losses)
			(liability)						sales,						(liability)		included in
			balance		Included		Included in		issuances						balance		net income
			as of		in net		other		and		Transfers		Transfers		as of		relating to
			January 1,		income		comprehensive		settlements		into		out of		December 31,		positions still
			2019		(1)		income		(3)		Level 3		Level 3		2019		held (1)
			(in millions)
Assets
Fixed maturities,
	available-for-sale:
	Non-U.S.
		governments	$	4.6	$	—	$	—	$	(4.6)	$	—	$	—	$	—	$	—
	Corporate			57.9		—		2.5		17.2		4.1		—		81.7		—
	Commercial
		mortgage-backed
		securities		9.5		(3.8)		3.4		2.4		3.7		(2.3)		12.9		(2.9)
	Collateralized
		debt obligations		8.3		(2.6)		0.9		122.5		69.9		—		199.0		(2.6)
	Other debt
		obligations		58.5		—		0.8		100.0		8.3		(76.3)		91.3		—
Total fixed
	maturities,
	available-for-sale			138.8		(6.4)		7.6		237.5		86.0		(78.6)		384.9		(5.5)
Fixed maturities,
	trading			—		—		—		0.3		—		—		0.3		—
Other investments				17.2		5.9		—		1.1		10.0		—		34.2		6.0
Separate account
	assets (2)			8,444.0		735.5		—		(212.1)		—		(0.7)		8,966.7		697.1
Liabilities
Investment and
	universal life
	contracts			(5.3)		(132.9)		—		(13.0)		—		—		(151.2)		(134.0)
Derivatives
Net derivative assets
	(liabilities)			3.5		(0.2)		—		8.3		—		—		11.6		3.9

B-85

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

			For the year ended December 31, 2018
																	Changes in
			Beginning		Total realized/unrealized				Net						Ending		unrealized
			asset/		gains (losses)				purchases,						asset/		gains (losses)
			(liability)						sales,						(liability)		included in
			balance		Included		Included in		issuances						balance		net income
			as of		in net		other		and		Transfers		Transfers		as of		relating to
			January 1,		income		comprehensive		settlements		into		out of		December 31,		positions still
			2018		(1)		income		(3)		Level 3		Level 3		2018		held (1)
			(in millions)
Assets
Fixed maturities,
	available-for-sale:
	Non-U.S.
		governments	$	6.1	$	—	$	(0.1)	$	(1.4)	$	—	$	—	$	4.6	$	—
	Corporate			100.6		(1.0)		0.3		(22.0)		—		(20.0)		57.9		—
	Commercial
		mortgage-backed
		securities		10.6		(3.5)		0.2		0.1		3.6		(1.5)		9.5		(1.9)
	Collateralized
		debt obligations		125.0		(0.9)		0.2		64.4		54.7		(235.1)		8.3		(0.9)
	Other debt
		obligations		2.3		—		(0.2)		147.4		—		(91.0)		58.5		—
Total fixed
	maturities,
	available-for-sale			244.6		(5.4)		0.4		188.5		58.3		(347.6)		138.8		(2.8)
Fixed maturities,
	trading			—		—		—		3.7		—		(3.7)		—		—
Equity securities				2.7		12.9		—		(15.6)		—		—		—		—
Other investments				6.5		1.7		—		9.0		—		—		17.2		1.7
Separate account
	assets (2)			7,486.3		889.7		—		106.8		2.3		(41.1)		8,444.0		829.8
Liabilities
Investment and
	universal life
	contracts			(119.6)		107.9		—		6.4		—		—		(5.3)		110.3
Derivatives
Net derivative assets
	(liabilities)			19.6		(18.6)		—		2.5		—		—		3.5		(17.1)

B-86

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

			For the year ended December 31, 2017
																	Changes in
			Beginning		Total realized/unrealized				Net						Ending		unrealized
			asset/		gains (losses)				purchases,						asset/		gains (losses)
			(liability)						sales,						(liability)		included in
			balance		Included		Included in		issuances						balance		net income
			as of		in net		other		and		Transfers		Transfers		as of		relating to
			January 1,		income		comprehensive		settlements		into		out of		December 31,		positions still
			2017		(1)		income		(3)		Level 3		Level 3		2017		held (1)
			(in millions)
Assets
Fixed maturities,
	available-for-sale:
	Non-U.S.
		governments	$	7.6	$	—	$	(0.1)	$	(1.4)	$	—	$	—	$	6.1	$	—
	Corporate			145.6		(1.5)		4.4		(32.8)		22.2		(37.3)		100.6		—
	Commercial
		mortgage-backed
		securities		71.1		(12.7)		11.1		(0.7)		26.3		(84.5)		10.6		(4.0)
	Collateralized
		debt obligations		33.6		—		1.7		7.3		183.7		(101.3)		125.0		—
	Other debt
		obligations		91.5		—		(0.2)		(0.8)		0.1		(88.3)		2.3		—
Total fixed
	maturities,
	available-for-sale			349.4		(14.2)		16.9		(28.4)		232.3		(311.4)		244.6		(4.0)
Fixed maturities,
	trading			92.9		(0.5)		—		(92.4)		—		—		—		—
Equity securities,
	available-for-sale			2.7		—		—		—		—		—		2.7		—
Equity securities,
	trading			—		—		—		(0.7)		0.7		—		—		—
Other investments				36.9		3.9		—		(34.3)		—		—		6.5		3.8
Separate account
	assets (2)			7,226.3		788.8		—		(493.2)		3.1		(38.7)		7,486.3		696.0
Liabilities
Investment and
	universal life
	contracts			(130.8)		6.8		—		4.4		—		—		(119.6)		4.0
Other liabilities				(59.9)		(0.1)		—		60.0		—		—		—		—
Derivatives
Net derivative assets
	(liabilities)			11.8		7.5		—		0.3		—		—		19.6		6.7

(1) Both realized gains (losses) and mark-to-market unrealized gains (losses) are generally reported in net realized capital gains (losses) within the consolidated statements of operations. Realized and unrealized gains (losses) on certain securities with an investment objective to realize economic value through mark-to-market changes are reported in net investment income within the consolidated statements of operations.

(2) Gains and losses for separate account assets do not impact net income as the change in value of separate account assets is offset by a change in value of separate account liabilities.

(3) Gross purchases, sales, issuances and settlements were:

B-87

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

		For the year ended December 31, 2019
										Net purchases,
										sales, issuances
		Purchases		Sales		Issuances		Settlements		and settlements
		(in millions)
Assets
Fixed maturities, available-for-sale:
	Non-U.S. governments	$	—	$	—	$	—	$	(4.6)	$	(4.6)
	Corporate		41.9		(1.4)		—		(23.3)		17.2
	Commercial mortgage-backed securities		2.4		—		—		—		2.4
	Collateralized debt obligations		124.7		—		—		(2.2)		122.5
	Other debt obligations		107.7		—		—		(7.7)		100.0
Total fixed maturities, available-for-sale			276.7		(1.4)		—		(37.8)		237.5
Fixed maturities, trading			0.5		—		—		(0.2)		0.3
Other investments			6.0		(4.9)		—		—		1.1
Separate account assets (4)			279.2		(524.4)		(280.4)		313.5		(212.1)
Liabilities
Investment and universal life contracts			—		—		(17.8)		4.8		(13.0)
Derivatives
Net derivative assets (liabilities)			1.9		6.4		—		—		8.3

		For the year ended December 31, 2018
										Net purchases,
										sales, issuances
		Purchases		Sales		Issuances		Settlements		and settlements
		(in millions)
Assets
Fixed maturities, available-for-sale:
	Non-U.S. governments	$	—	$	—	$	—	$	(1.4)	$	(1.4)
	Corporate		2.3		(6.3)		—		(18.0)		(22.0)
	Commercial mortgage-backed securities		—		—		—		0.1		0.1
	Collateralized debt obligations		91.7		—		—		(27.3)		64.4
	Other debt obligations		152.0		—		—		(4.6)		147.4
Total fixed maturities, available-for-sale			246.0		(6.3)		—		(51.2)		188.5
Fixed maturities, trading			3.7		—		—		—		3.7
Equity securities			—		(15.6)		—		—		(15.6)
Other investments			9.0		—		—		—		9.0
Separate account assets (4)			627.1		(519.4)		(206.5)		205.6		106.8
Liabilities
Investment and universal life contracts			—		—		2.8		3.6		6.4
Derivatives
Net derivative assets (liabilities)			1.8		0.7		—		—		2.5

B-88

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

		For the year ended December 31, 2017
										Net purchases,
										sales, issuances
		Purchases		Sales		Issuances		Settlements		and settlements
		(in millions)
Assets
Fixed maturities, available-for-sale:
	Non-U.S. governments	$	—	$	—	$	—	$	(1.4)	$	(1.4)
	Corporate		20.9		(1.6)		—		(52.1)		(32.8)
	Commercial mortgage-backed securities		—		—		—		(0.7)		(0.7)
	Collateralized debt obligations		22.9		—		—		(15.6)		7.3
	Other debt obligations		—		—		—		(0.8)		(0.8)
Total fixed maturities, available-for-sale			43.8		(1.6)		—		(70.6)		(28.4)
Fixed maturities, trading			—		—		—		(92.4)		(92.4)
Equity securities, trading			—		—		—		(0.7)		(0.7)
Other investments			2.4		(36.7)		—		—		(34.3)
Separate account assets (4)			302.2		(580.6)		(284.6)		69.8		(493.2)
Liabilities
Investment and universal life contracts			—		—		—		4.4		4.4
Other liabilities			—		—		—		60.0		60.0
Derivatives
Net derivative assets (liabilities)			0.8		(0.5)		—		—		0.3

(4) Issuances and settlements include amounts related to mortgage encumbrances associated with real estate in our separate accounts.

Transfers

Transfers of assets and liabilities measured at fair value on a recurring basis between fair value hierarchy levels were as follows:

			For the year ended December 31, 2019
			Transfers out		Transfers out		Transfers out		Transfers out		Transfers out		Transfers out
			of Level 1 into		of Level 1 into		of Level 2 into		of Level 2 into		of Level 3 into		of Level 3 into
			Level 2		Level 3		Level 1		Level 3		Level 1		Level 2
			(in millions)
Assets
Fixed maturities, available-for-
	sale:
	Corporate		$	—	$	—	$	—	$	4.1	$	—	$	—
	Commercial mortgage-backed
		securities		—		—		—		3.7		—		2.3
	Collateralized debt obligations			—		—		—		69.9		—		—
	Other debt obligations			—		—		—		8.3		—		76.3
Total fixed maturities,
	available-for-sale			—		—		—		86.0		—		78.6
Other investments				—		—		—		10.0		—		—
Separate account assets				—		—		—		—		—		0.7

B-89

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

			For the year ended December 31, 2018
			Transfers out		Transfers out		Transfers out		Transfers out		Transfers out		Transfers out
			of Level 1 into		of Level 1 into		of Level 2 into		of Level 2 into		of Level 3 into		of Level 3 into
			Level 2		Level 3		Level 1		Level 3		Level 1		Level 2
			(in millions)
Assets
Fixed maturities, available-for-
	sale:
	Corporate		$	—	$	—	$	—	$	—	$	—	$	20.0
	Commercial mortgage-backed
		securities		—		—		—		3.6		—		1.5
	Collateralized debt obligations			—		—		—		54.7		—		235.1
	Other debt obligations			—		—		—		—		—		91.0
Total fixed maturities,
	available-for-sale			—		—		—		58.3		—		347.6
Fixed maturities, trading				—		—		—		—		—		3.7
Separate account assets				287.5		—		0.8		2.3		0.2		40.9

			For the year ended December 31, 2017
			Transfers out		Transfers out		Transfers out		Transfers out		Transfers out		Transfers out
			of Level 1 into		of Level 1 into		of Level 2 into		of Level 2 into		of Level 3 into		of Level 3 into
			Level 2		Level 3		Level 1		Level 3		Level 1		Level 2
			(in millions)
Assets
Fixed maturities, available-for-
	sale:
	Corporate		$	—	$	—	$	—	$	22.2	$	—	$	37.3
	Commercial mortgage-backed
		securities		—		—		—		26.3		—		84.5
	Collateralized debt obligations			—		—		—		183.7		—		101.3
	Other debt obligations			—		—		—		0.1		—		88.3
Total fixed maturities,
	available-for-sale			—		—		—		232.3		—		311.4
Equity securities, trading				—		—		—		0.7		—		—
Separate account assets				12.5		—		5.9		3.1		—		38.7

Transfers between fair value hierarchy levels are recognized at the beginning of the reporting period.

Separate account assets transferred from Level 1 to Level 2 during 2018 primarily included cash equivalents as a result of additional analysis to clarify the source of the price. Separate account assets transferred between Level 1 and Level 2 during 2017 primarily related to foreign equity securities. When these securities are valued at the close price of the local exchange where the assets traded, they are reflected in Level 1. When events materially affecting the value occur between the close of the local exchange and the New York Stock Exchange, we use adjusted prices determined by a third party pricing vendor to update the foreign market closing prices and the fair value is reflected in Level 2.

Assets transferred into Level 3 during 2019, 2018 and 2017, primarily included those assets for which we are now unable to obtain pricing from a recognized third party pricing vendor as well as assets that were previously priced using a matrix valuation approach that may no longer be relevant when applied to asset-specific situations.

Assets transferred out of Level 3 during 2019, 2018 and 2017, included those for which we are now able to obtain pricing from a recognized third party pricing vendor or from internal models using substantially all market observable information.

B-90

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Quantitative Information about Level 3 Fair Value Measurements

The following table provides quantitative information about the significant unobservable inputs used for recurring fair value measurements categorized within Level 3, excluding assets and liabilities for which significant quantitative unobservable inputs are not developed internally, which primarily consists of those valued using broker quotes or the measurement alternative for CCFEs. Refer to “Assets and liabilities measured at fair value on a recurring basis” for a complete valuation hierarchy summary.

		December 31, 2019
		Assets /
		(liabilities)
		measured at		Valuation	Unobservable	Input/range		Weighted
		fair value		technique(s)	input description	of inputs		average
		(in millions)
Assets
Fixed maturities, available-for-sale:
	Corporate	$	72.5	Discounted cash   flow	Discount rate (1)	1.9%-5.1%		3.8	%
					Illiquidity premium	0 basis points ("bps")-410bps		152bps
	Commercial mortgage-backed   securities		2.4	Discounted cash   flow	Probability of default	100.0	%	100.0	%
					Potential loss   severity	53.1	%	53.1	%
	Collateralized debt obligations		108.7	Discounted cash   flow	Discount rate (1)	2.9%-10.0%		3.4	%
					Potential loss   severity	23.0	%	23.0	%
					Probability of default	100.0	%	100.0	%
	Other debt obligations		1.2	Discounted cash   flow	Discount rate (1)	5.0	%	5.0	%
					Illiquidity premium	500bps		500bps
Other investments			10.0	Market   comparables	Revenue multiples (2)	0.8x-5.0x		3.2x
Separate account assets			8,966.2	Discounted cash   flow - mortgage   loans	Discount rate (1)	2.8	%	2.8	%
					Illiquidity premium	60bps		60bps
					Credit spread rate	120bps		120bps
				Discounted cash   flow - real estate	Discount rate (1)	5.5%-11.8%		6.7	%
					Terminal   capitalization rate	4.5%-9.3%		5.7%
					Average market rent   growth rate	2.0%-4.7%		3.0%
				Discounted cash   flow - real estate   debt	Loan to value	8.0%-80.4%		45.9	%
					Market interest rate	3.2%-5.8%		3.6	%

B-91

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

	December 31, 2019
	Assets /
	(liabilities)
	measured at		Valuation	Unobservable	Input/range	Weighted
	fair value		technique(s)	input description	of inputs	average
	(in millions)
Liabilities
Investment and universal life   contracts (6)		(151.2)	Discounted cash   flow	Long duration   interest rate	2.1% (3)
				Long-term equity   market volatility	16.9%-26.9%
				Non-performance risk	0.2%-1.3%
				Utilization rate	See note (4)
				Lapse rate	0.0%-9.3%
				Mortality rate	See note (5)

		December 31, 2018
		Assets /
		(liabilities)
		measured at		Valuation	Unobservable	Input/range		Weighted
		fair value		technique(s)	input description	of inputs		average
		(in millions)
Assets
Fixed maturities, available-for-sale:
	Non-U.S. governments	$	4.6	Discounted cash   flow	Discount rate (1)	3.2	%	3.2	%
					Illiquidity premium	50bps		50bps
					Comparability   adjustment	(25)bps		(25)bps
	Corporate		25.4	Discounted cash   flow	Discount rate (1)	3.3%-4.5%		3.9	%
					Illiquidity premium	0bps-60bps		36bps
	Other debt obligations		1.7	Discounted cash   flow	Discount rate (1)	5.0	%	5.0	%
					Illiquidity premium	500bps		500bps
Separate account assets			8,440.8	Discounted cash   flow - mortgage   loans	Discount rate (1)	3.3%-4.7%		4.2	%
					Illiquidity premium	0bps-60bps		56bps
					Credit spread rate	85bps-172bps		168bps
				Discounted cash   flow - real estate	Discount rate (1)	5.6%-11.5%		6.7	%
					Terminal   capitalization rate	4.3%-9.3%		5.8%
					Average market rent   growth rate	2.0%-4.7%		2.9%
				Discounted cash   flow - real estate   debt	Loan to value	11.0%-69.3%		45.9	%
					Market interest rate	3.9%-6.0%		4.3	%

B-92

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

	December 31, 2018
	Assets /
	(liabilities)
	measured at		Valuation	Unobservable	Input/range	Weighted
	fair value		technique(s)	input description	of inputs	average
	(in millions)
Liabilities
Investment and universal life   contracts (6)		(5.3)	Discounted cash   flow	Long duration   interest rate	2.8% (3)
				Long-term equity   market volatility	16.7%-27.8%
				Non-performance risk	0.6%-1.6%
				Utilization rate	See note (4)
				Lapse rate	1.3%-9.3%
				Mortality rate	See note (5)

(1) Represents market comparable interest rate or an index adjusted rate used as the base rate in the discounted cash flow analysis prior to any illiquidity or other adjustments, where applicable.

(2) Revenue multiples are amounts used when we have determined market participants would use such multiples to value the investments.

(3) Represents the range of rate curves used in the valuation analysis that we have determined market participants would use when pricing the instrument. Derived from interpolation between various observable swap rates.

(4) This input factor is the number of contractholders taking withdrawals as well as the amount and timing of the withdrawals and a range does not provide a meaningful presentation.

(5) This input is based on an appropriate industry mortality table and a range does not provide a meaningful presentation.

(6) Includes bifurcated embedded derivatives that are reported at net asset (liability) fair value within the same line item in the consolidated statements of financial position in which the host contract is reported.

Market comparable discount rates are used as the base rate in the discounted cash flows used to determine the fair value of certain assets. Increases or decreases in the credit spreads on the comparable assets could cause the fair value of the assets to significantly decrease or increase, respectively. Additionally, we may adjust the base discount rate or the modeled price by applying an illiquidity premium given the highly structured nature of certain assets. Increases or decreases in this illiquidity premium could cause significant decreases or increases, respectively, in the fair value of the asset.

Embedded derivatives within our investment and universal life contracts liability can be in either an asset or liability position, depending on certain inputs at the reporting date. Increases to an asset or decreases to a liability are described as increases to fair value. Increases or decreases in market volatilities could cause significant decreases or increases, respectively, in the fair value of embedded derivatives in investment and universal life contracts. Long duration interest rates are used as the mean return when projecting the growth in the value of associated account value and impact the discount rate used in the discounted future cash flows valuation. The amount of claims will increase if account value is not sufficient to cover guaranteed withdrawals. Increases or decreases in risk-free rates could cause the fair value of the embedded derivative to significantly increase or decrease, respectively. Increases or decreases in our own credit risks, which impact the rates used to discount future cash flows, could significantly increase or decrease, respectively, the fair value of the embedded derivative. All of these changes in fair value would impact net income.

Decreases or increases in the mortality rate assumption could cause the fair value of the embedded derivative to decrease or increase, respectively. Decreases or increases in the overall lapse rate assumption could cause the fair value of the embedded derivative to decrease or increase, respectively. The lapse rate assumption may vary dynamically based on the relationship of the guarantee and associated account value. A stronger or weaker dynamic lapse rate assumption could cause the fair value of the embedded derivative to decrease or increase, respectively. The utilization rate assumption includes how many contractholders will take withdrawals, when they will take them and how much of their benefit they will take. Increases or decreases in the assumption of the number of contractholders taking withdrawals could cause the fair value of the embedded derivative to decrease or increase, respectively. Assuming contractholders take withdrawals earlier or later could cause the fair value of the embedded derivative to decrease or increase, respectively. Assuming contractholders take more or less of their benefit could cause the fair value of the embedded derivative to decrease or increase, respectively.

B-93

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

No significant assets and liabilities were measured at fair value on a nonrecurring basis for the years ended December 31, 2019, 2018 and 2017.

Fair Value Option

We elected fair value accounting for:

• Certain commercial mortgage loans of a consolidated VIE for which it was not practicable for us to determine the carrying value. The consolidated VIE was unwound in the third quarter of 2019. In addition, we had certain obligations of consolidated VIEs held by a synthetic entity for which it was not practicable for us to determine the carrying value. The synthetic entity matured in the first quarter of 2017.

• Certain real estate ventures that are subject to the equity method of accounting because the nature of the investments is to add value to the properties and generate income from the operations of the properties. Other equity method real estate investments are not fair valued because the investments mainly generate income from the operations of the underlying properties.

• In 2017, we had certain investment funds for which we did not have enough influence to account for under the equity method in order to reflect the economics of the investment in the financial statements. We did not elect the fair value option for other similar investments as these investments are generally accounted for under the equity method of accounting.

The following tables present information regarding the assets and liabilities for which the fair value option was elected.

		December 31, 2019		December 31, 2018
		(in millions)
Commercial mortgage loans of consolidated VIEs (1) (2)
	Fair value	$	—	$	6.4
	Aggregate contractual principal		—		6.5
Real estate ventures (1)
	Fair value		22.8		17.2

(1) Reported with other investments in the consolidated statements of financial position.

(2) None of the loans were more than 90 days past due or in non-accrual status.

B-94

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Commercial mortgage loans of consolidated VIEs
	Change in fair value pre-tax gain (loss) (1) (2)	$	0.1	$	(0.2)	$	(0.4)
	Interest income (3)		0.3		0.7		0.9
Obligations of consolidated VIEs
	Change in fair value pre-tax loss - instrument-specific credit risk (2) (4)		—		—		(0.1)
	Change in fair value pre-tax loss (2)		—		—		(0.1)
	Interest expense (5)		—		—		0.3
Real estate ventures
	Change in fair value pre-tax gain (6)		6.0		1.7		3.8
Investment funds
	Change in fair value pre-tax gain (6) (7)		—		—		1.7
	Dividend income (6)		—		—		1.9

(1) None of the change in fair value related to instrument-specific credit risk.

(2) Reported in net realized capital gains (losses) on the consolidated statements of operations.

(3) Reported in net investment income on the consolidated statements of operations and recorded based on the effective interest rates as determined at the closing of the loan.

(4) Estimated based on credit spreads and quality ratings.

(5) Reported in operating expenses on the consolidated statements of operations.

(6) Reported in net investment income on the consolidated statements of operations.

(7) Absent the fair value election, the change in fair value on the investments would be reported in OCI.

Financial Instruments Not Reported at Fair Value

The carrying value and estimated fair value of financial instruments not recorded at fair value on a recurring basis but required to be disclosed at fair value were as follows:

	December 31, 2019
					Fair value hierarchy level
	Carrying amount		Fair value		Level 1		Level 2		Level 3
	(in millions)
Assets (liabilities)
Mortgage loans	$	15,820.3	$	16,548.0	$	—	$	—	$	16,548.0
Policy loans		742.2		966.3		—		—		966.3
Other investments		273.5		267.8		—		175.0		92.8
Cash and cash equivalents		795.7		795.7		795.7		—		—
Investment contracts		(33,264.0)		(33,358.2)		—		(4,304.5)		(29,053.7)
Long-term debt		(108.7)		(107.6)		—		—		(107.6)
Separate account liabilities		(111,959.7)		(110,964.9)		—		—		(110,964.9)
Bank deposits (1)		(469.6)		(468.3)		—		(468.3)		—
Cash collateral payable		(156.8)		(156.8)		(156.8)		—		—

B-95

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

	December 31, 2018
					Fair value hierarchy level
	Carrying amount		Fair value		Level 1		Level 2		Level 3
	(in millions)
Assets (liabilities)
Mortgage loans	$	14,662.2	$	14,708.8	$	—	$	—	$	14,708.8
Policy loans		755.9		916.3		—		—		916.3
Other investments		240.9		233.3		—		151.0		82.3
Cash and cash equivalents		860.5		860.5		860.5		—		—
Investment contracts		(31,867.1)		(30,739.2)		—		(4,085.7)		(26,653.5)
Long-term debt		(129.1)		(127.8)		—		—		(127.8)
Separate account liabilities		(95,341.6)		(94,488.7)		—		—		(94,488.7)
Bank deposits (1)		(500.0)		(489.1)		—		(489.1)		—
Cash collateral payable		(70.1)		(70.1)		(70.1)		—		—

(1) Excludes deposit liabilities without defined or contractual maturities.

17. Statutory Insurance Financial Information

We, the largest indirect subsidiary of PFG, prepare statutory financial statements in accordance with the accounting practices prescribed or permitted by the Insurance Division of the Department of Commerce of the State of Iowa (the “Iowa Insurance Division”). The Iowa Insurance Division recognizes only statutory accounting practices prescribed or permitted by the State of Iowa for determining and reporting the financial condition and results of operations of an insurance company to determine its solvency under the Iowa Insurance Law. The National Association of Insurance Commissioners' (“NAIC”) Accounting Practices and Procedures Manual has been adopted as a component of prescribed practices by the State of Iowa. The Commissioner has the right to permit other specific practices that deviate from prescribed practices. Statutory accounting practices differ from U.S. GAAP primarily due to charging policy acquisition costs to expense as incurred, establishing reserves using different actuarial assumptions, valuing investments on a different basis and not admitting certain assets, including certain net deferred income tax assets.

For the years ended, December 31, 2019 and 2018, our use of prescribed statutory accounting practices resulted in higher statutory surplus of $862.1 million and $546.3 million, respectively, relative to the accounting practices and procedures of the NAIC due to its accounting for reserve credits associated with a reinsurance transaction with an affiliated reinsurer. In addition, as of December 31, 2019 and 2018, our permitted statutory accounting practice relating to variable annuities with a guaranteed living benefit rider resulted in lower statutory surplus of $151.3 million and $69.9 million, respectively, relative to carrying certain interest rate swaps at book value rather than fair value, as if they received hedge accounting treatment for statutory. Effective January 1, 2020, the Iowa Insurance Division approved our request to discontinue the use of this permitted practice due to changes in the practices and procedures of the NAIC. The discontinuance of the permitted practice will create a one-time increase to surplus.

We cede certain term and universal life insurance statutory reserves to our affiliated reinsurance subsidiaries on a funds withheld coinsurance basis. The reserves are secured by cash, invested assets and financing provided by highly rated third parties. As of December 31, 2019 and 2018, our affiliated reinsurance subsidiaries assumed statutory reserves of $7,902.3 million and $6,850.3 million from us, respectively. In the states of Vermont and Delaware, the affiliated reinsurers had permitted and prescribed practices allowing for the admissibility of certain assets backing these reserves. As of December 31, 2019 and 2018, assets admitted under these practices totaled $3,358.0 million and $2,852.0 million, respectively.

Life and health insurance companies are subject to certain risk-based capital (“RBC”) requirements as specified by the NAIC. Under those requirements, the amount of capital and surplus maintained by a life and health insurance company is to be determined based on the various risk factors related to it. As of December 31, 2019, we met the minimum RBC requirements.

B-96

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Our statutory net income and statutory capital and surplus were as follows:

	As of or for the year ended December 31,
	2019		2018		2017
	(in millions)
Statutory net income	$	989.3	$	1,017.6	$	1,976.7
Statutory capital and surplus		5,193.4		5,319.6		4,946.8

18. Revenues from Contracts with Customers

Administrative Service Fee Revenue

We offer service and trust agreements for defined contribution plans, including 401(k) plans, 403(b) plans, and employee stock ownership plans. The investment components of these service agreements are in the form of mutual fund offerings. In addition, plan sponsor trust services are also available through an affiliated trust company.

• Fees and other revenues are earned for administrative activities performed for the defined contribution plans including recordkeeping and reporting as well as trust, asset management and investment services. The majority of these activities are performed daily over time. Fee-for-service transactions are also provided upon client request. These services are considered distinct or grouped into a bundle until a distinct performance obligation is identified. Some performance obligations are considered a series of distinct services, which are substantially the same and have the same pattern of transfer to the customer.

• Fees and other revenues can be based on a fixed contractual rate for these services or can be variable based upon contractual rates applied to the market value of the client's investment portfolio each day. If the consideration for this series of performance obligations is based on daily market value, it is considered variable each day as the services are performed over time. The consideration becomes unconstrained and thus recognized as revenue for each day’s series of distinct services once the market value of the clients’ investment portfolios is determined at market close or carried over at the end of the day for days when the market is closed. Additionally, fixed fees and other revenues are recognized point-in-time as fee-for-service transactions upon completion.

We offer administrative services performed for our fee-for-service products, nonqualified benefit plans, separate accounts and dental networks.

• Fees and other revenues are earned for administrative services performed, which include recordkeeping and reporting services. Services within contracts are not distinct on their own; however, we combine the services into a distinct bundle and account for the bundle as a single performance obligation, which is satisfied over time utilizing the output method as services are rendered. The transaction price corresponds with the performance completed to date, for which the value is recognized as revenue during the period. Variability of consideration is resolved at the end of each period and payments are due when billed.

Deposit Account Fee Revenue

We offer individual retirement accounts (“IRAs”) through Principal Bank, which are primarily funded by retirement savings rolled over from qualified retirement plans. The IRAs are held in savings accounts, money market accounts and certificates of deposit. Revenues are earned through fees as the performance of establishing and maintaining IRA accounts is completed. Fee-for-service transactions are also provided upon client request. The establishment fees and annual maintenance fees are accrued into earnings over a period of time using the average account life. Upfront and recurring bank fees are related to performance obligations that have the same pattern of transfer to the customer and are recognized in income over time with control transferred to the customers utilizing the output method. These fees are based on a fixed contractual rate. Fixed fees and other revenues are also recognized point-in-time as fee-for-service transactions upon completion.

Commission Income

Commission income is earned through sponsored brokerage services. Performance obligations are satisfied at a point in time, upon delivery of a placed case, and the transaction price calculated per the compensation schedule is recognized as revenue.

B-97

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

Disaggregation of Revenues from Contracts with Customers

The following table summarizes the disaggregation of revenues from contracts with customers and reconciles totals to those reported in the consolidated financial statements. Revenues from contracts with customers are included in fees and other revenues on the consolidated statements of operations.

		For the year ended December 31,
		2019		2018		2017
		(in millions)
Administrative service fee revenue		$	283.2	$	284.1	$	288.0
Deposit account fee revenue			9.3		10.5		10.2
Commission income			26.9		19.6		14.9
Other fee revenue			2.5		2.3		2.1
	Total revenues from contracts with customers		321.9		316.5		315.2
Fees and other revenues not within the scope of revenue
	recognition guidance (1)		2,074.8		1,905.7		1,866.9
Total fees and other revenues per consolidated statements of
	operations	$	2,396.7	$	2,222.2	$	2,182.1

(1) Fees and other revenues not within the scope of the revenue recognition guidance primarily represent revenue on contracts accounted for under the financial instruments or insurance contracts standards.

Contract Costs

Sales compensation and other incremental costs of obtaining a contract are capitalized and amortized over the period of contract benefit if the costs are expected to be recovered. The contract cost asset, which is included in other assets on the consolidated statements of financial position, was $42.1 million and $42.5 million as of December 31, 2019 and December 31, 2018, respectively.

We apply the practical expedient for certain costs where we recognize the incremental costs of obtaining these contracts as an expense when incurred if the amortization period of the assets is one year or less. These costs, along with costs that are not deferrable, are included in operating expenses on the consolidated statements of operations.

Deferred contract costs consist primarily of commissions and variable compensation. We amortize capitalized contract costs on a straight-line basis over the expected contract life, reflecting lapses as they are incurred. Deferred contract costs are subject to impairment testing on an annual basis, or when a triggering event occurs that could warrant an impairment. To the extent future revenues less future maintenance expenses are not adequate to cover the asset balance, an impairment is recognized. For the years ended December 31, 2019 and 2018, $7.5 million and $8.4 million, respectively, of amortization expense was recorded in operating expenses on the consolidated statements of operations and no impairment loss was recognized in relation to the costs capitalized.

19. Stock‑Based Compensation Plans

As of December 31, 2019, our ultimate parent, PFG, sponsored the 2014 Stock Incentive Plan, the Employee Stock Purchase Plan, the Amended and Restated 2010 Stock Incentive Plan and the Stock Incentive Plan ("Stock-Based Compensation Plans"), which resulted in expense to us. As of May 20, 2014, no new grants will be made under the Amended and Restated 2010 Stock Incentive Plan. No grants have been made under the Stock Incentive Plan since at least 2005. Under the terms of the 2014 Stock Incentive Plan, grants may be nonqualified stock options, incentive stock options qualifying under Section 422 of the Internal Revenue Code, restricted stock, restricted stock units, stock appreciation rights, performance shares, performance units or other stock-based awards. To date, PFG has not granted any incentive stock options, restricted stock or performance units under any plans. The following Stock-Based Compensation Plans information represents all share-based compensation data related to us and our subsidiaries’ employees.

B-98

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

For awards with graded vesting, we use an accelerated expense attribution method. The compensation cost that was charged against income from continuing operations for stock-based awards granted under the Stock-Based Compensation Plans was as follows:

	For the year ended December 31,
	2019		2018		2017
	(in millions)
Compensation cost	$	21.9	$	26.4	$	28.4
Related income tax benefit		4.1		5.2		9.8
Capitalized as part of an asset		1.7		1.9		2.5

Nonqualified Stock Options

Nonqualified stock options were granted to certain employees under the 2014 Stock Incentive Plan, the Amended and Restated 2010 Stock Incentive Plan and the Stock Incentive Plan. Options outstanding were granted at an exercise price equal to the fair market value of PFG common stock on the date of grant and expire ten years after the grant date. These options have graded vesting over a three-year period, except in the case of specific types of terminations.

The fair value of stock options is estimated using the Black‑Scholes option pricing model. The following is a summary of the assumptions used in this model for the stock options granted during the period:

	For the year ended December 31,
Options	2019			2018			2017
Expected volatility		23.3	%		26.0	%		27.6	%
Expected term (in years)		7.0			7.0			7.0
Risk-free interest rate		2.6	%		2.8	%		2.2	%
Expected dividend yield		4.07	%		3.19	%		2.87	%
Weighted average estimated fair value	$	10.00		$	14.85		$	15.31

We determine expected volatility based on a combination of historical volatility using daily price observations and implied volatility from traded options on PFG common stock. We believe that incorporating both historical and implied volatility into our expected volatility assumption calculation better reflects market expectations. The expected term represents the period of time that options granted are expected to be outstanding. We determine expected term using historical exercise and employee termination data. The risk-free rate for periods within the expected term of the option is based on the U.S. Treasury risk-free interest rate in effect at the time of grant. The dividend yield is based on historical dividend distributions compared to the closing price of PFG common shares on the grant date.

As of December 31, 2019, we had $1.5 million of total unrecognized compensation cost related to nonvested stock options. The cost is expected to be recognized over a weighted‑average service period of approximately 1.8 years.

Performance Share Awards

Performance share awards were granted to certain employees under the 2014 Stock Incentive Plan and the Amended and Restated 2010 Stock Incentive Plan. The performance share awards are treated as an equity award and are paid in shares. Whether the performance shares are earned depends upon the participant's continued employment through the performance period (except in the case of specific types of terminations) and PFG’s performance against three-year goals set at the beginning of the performance period. Performance goals based on various PFG factors must be achieved for any of the performance shares to be earned. If the performance requirements are not met, the performance shares will be forfeited, no compensation cost will be recognized and any previously recognized compensation cost will be reversed. These awards have no maximum contractual term. Dividend equivalents are credited on performance shares outstanding as of the record date. These dividend equivalents are only paid on the shares released.

The fair value of performance share awards is determined based on the closing stock price of PFG common shares on the grant date. The weighted‑average grant-date fair value of performance share awards granted during 2019, 2018 and 2017 was $53.09, $63.98 and $62.78, respectively.

B-99

Principal Life Insurance Company
Notes to Consolidated Financial Statements – (continued)December 31, 2019

As of December 31, 2019, we had $1.9 million of total unrecognized compensation cost related to nonvested performance share awards granted. The cost is expected to be recognized over a weighted‑average service period of approximately 1.6 years.

Restricted Stock Units

Restricted stock units were granted to certain employees and agents under the 2014 Stock Incentive Plan, the Amended and Restated 2010 Stock Incentive Plan and Stock Incentive Plan. Restricted stock units are treated as equity awards and are paid in shares. Under these plans, awards have graded or cliff vesting over a three-year service period. When service for PFG ceases (except in the case of specific types of terminations), all vesting stops and unvested units are forfeited. These awards have no maximum contractual term. Dividend equivalents are credited on restricted stock units outstanding as of the record date. These dividend equivalents are only paid on the shares released.

The fair value of restricted stock units is determined based on the closing stock price of PFG common shares on the grant date. The weighted‑average grant-date fair value of restricted stock units granted during 2019, 2018 and 2017 was $53.19, $63.77 and $62.80, respectively.

As of December 31, 2019, we had $18.1 million of total unrecognized compensation cost related to nonvested restricted stock unit awards granted under these plans. The cost is expected to be recognized over a weighted‑average period of approximately 1.7 years.

Employee Stock Purchase Plan

Under the Employee Stock Purchase Plan, participating employees had the opportunity to purchase shares of PFG common stock on a semi-annual basis through 2017. Beginning in 2018, participating employees had the opportunity to purchase shares of PFG common stock on a quarterly basis. Employees may purchase up to $25,000 in PFG stock value annually. Employees may purchase shares of PFG common stock at a price equal to 85% of the shares' fair market value as of the beginning or end of the purchase period, whichever is lower.

We recognize compensation expense for the fair value of the discount granted to employees participating in the employee stock purchase plan in the period of grant. Shares of the Employee Stock Purchase Plan are treated as an equity award. The weighted‑average fair value of the discount on the stock purchased was $11.37, $9.27 and $14.72 during 2019, 2018 and 2017, respectively.

B-100

PART C

OTHER INFORMATION

Item 24.Financial Statements and Exhibits

Unless otherwise noted, documents containing Accession Numbers below have previously been filed with the Securities and Exchange Commission and are incorporated herein by reference.

(a) Financial Statements included in the Registration Statement

(1) Part A:

Condensed Financial Information for the 10 years ended December 31, 2019

(2) Part B:

Principal Life Insurance Company Separate Account B:

Report of Independent Registered Public Accounting Firm

Statements of Assets and Liabilities, December 31, 2019

Statements of Operations for the year ended December 31, 2019

Statements of Changes in Net Assets for the years ended December 31, 2019 and 2018

Notes to Financial Statements.

Principal Life Insurance Company:

Report of Independent Registered Public Accounting Firm

Consolidated Statements of Financial Position at December 31, 2019 and 2018

Consolidated Statements of Operations for the years ended December 31, 2019, 2018 and 2017

Consolidated Statements of Stockholder's Equity for the years ended December 31, 2019, 2018 and 2017

Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017

Notes to Consolidated Financial Statements.

(3) Part C

Principal Life Insurance Company

Report of Independent Registered Public Accounting Firm on Schedules *

Schedule I - Summary of Investments - Other Than Investments in Related Parties As of December 31, 2019 *

Schedule III - Supplementary Insurance Information as of December 31, 2019, 2018 and 2017 and for each of the years then ended *

Schedule IV - Reinsurance as of December 31, 2019, 2018 and 2017 and for each of the years then ended *

All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable and therefore have been omitted.

(b)	Exhibits
	(1)	Resolution of Board of Directors of the Depositor (filed with the Commission on 06/07/2004 Accession No. 0000870786-04-000093)
	(3a)	Distribution Agreement dated 08/04/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000212)
	(3b)	Selling Agreement (filed with the Commission on 06/07/2004 Accession No. 0000870786-04-000093)
	(4a)	Form of Variable Annuity Contract (filed with the Commission on 06/07/2004 Accession No. 0000870786-06-000093)
	(4b)	Amendment to Enhanced Death Benefit Rider (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4c)	Amendment to Fixed Account Endorsement (filed 04/27/2006 Accession No, 0000009713-06-000038)
	(4d)	Amendment to Fixed DCA Account Endorsement (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4e)	Amendment to GMWB Rider (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4f)	Amendment to Contract Data Page (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4g)	Amendment to Partial Annuitization Endorsement (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4h)	Amendment to Premium Payment Credit Rider (filed 04/27/2006 Accession No. 0000009713-06-000038)
	(4i)	Form of Specimen Guaranteed Minimum Withdrawal Benefit 2 – Joint Life Rider (filed 05/01/2008 Accession No. 0000950137-08-006515)
	(4j)	Form of Specimen Guaranteed Minimum Withdrawal Benefit 2 – Single Life Rider (filed 05/01/2008 Accession No. 0000950137-08-006515)
	(5)	Form of Variable Annuity Application (filed 06/07/2004 Accession No. 0000870786-04-000093)
	(6a)	Articles of Incorporation of the Depositor (filed with the Commission on 06/07/2004 Accession No. 0000870786-04-000093)
	(6b)	Bylaws of Depositor (filed with the Commissioner 06/07/2004 Accession No. 0000870786-04-000093)

(8)	Participation Agreements
	a. AllianceBernstein
	(1)	Participation Agreement with AllianceBernstein Variable Products Series Fund, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
	(2)	AllianceBernstein Investment, Inc. Participation Agreement Amendment No. 1 dated 01/01/2008 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
	(3)	AllianceBernstein Investment, Inc. Participation Agreement Amendment No. 2 dated 05/01/2011 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
	(4)	AllianceBernstein Investment Research and Management, Inc. Master Administrative Services Agreement Letter dated 12/15/2004 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
	(5)	Rule 22c-2 Agreement with AllianceBernstein Variable Products Series Fund, (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)

b. American Century
(1)	American Century Investment Services, Inc. Shareholder Services Agreement dated 04/01/1999 as amended on 05/01/2001, 05/01/2002, 05/01/2004, and 10/13/2005 (filed with the Commission for 333-116220 as Ex-99.8C1 on 05/01/2008 Accession No. 0000950137-08-006515)
(2)	American Century Investment Services, Inc. Amendment No. 5 to Shareholder Services Agreement dated 06/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	American Century Investment Services, Inc. Amendment No. 6 and Joinder to Shareholder Service Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	American Century Investment Services, Inc. Amendment No. 7 to Shareholder Service Agreement dated 03/20/2014 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	American Century Investment Services, Inc. Rule 22c-2 Agreement (filed with the Commission as Ex-99.8C2 on 05/01/08 Accession No. 0000950137-08-006515)
(6)	American Century Investment Services, Inc. Amendment No. 1 to Rule 22c-2 Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

c. American Funds
(1)	American Funds Distributors, Inc. Participation and Service Agreement dated 05/01/2014 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(2)	American Funds Distributors, Inc. Business Agreement dated 05/01/2014 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	American Funds Service Company Rule 22c-2 Agreement dated 05/19/2014 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	American Funds Form of First Amendment To Fund Participation and Service Agreement (filed with the Commission on 04/30/2015 Accession No. 0000009713-15-000051)

d. BlackRock
(1)	BlackRock Variable Series Funds, Inc. Participation Agreement dated 05/19/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(2)	BlackRock Advisors, LLC Administrative Services Agreement dated 05/19/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(3)	BlackRock Variable Series Funds, Inc. Distribution Sub-Agreement dated 05/19/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)

e. Columbia Funds
(1)	Columbia Funds Variable Series Trust II Participation Agreement dated 04/28/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(2)	Columbia Management Investment Distributors, Inc. Services Agreement dated 05/01/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)

f. Delaware Distributors
(1)	Delaware VIP Trust & Delaware Distribution, L. P. Participation Agreement dated 04/26/2010 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(2)	Delaware VIP Trust & Delaware Distribution, L. P. Participation Agreement Amendment No. 1 dated 12/30/2010 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(3)	Delaware VIP Trust & Delaware Distribution, L. P. Participation Agreement Amendment No. 2 dated 04/04/2014 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(4)	Delaware VIP Trust & Delaware Distribution, L. P. Participation Agreement Amendment No. 3 dated 07/01/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(5)	Delaware Distributions, L.P. Administrative Services Agreement dated 04/26/2010 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)

g. Dreyfus
(1)	Participation Agreement with Dreyfus Investment Portfolios, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(2)	Dreyfus Services Corporation Participation Agreement Amendment No. 2 dated 04/15/11 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(3)	Dreyfus Services Corporation Participation Agreement Amendment No. 3 dated 04/25/12 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(4)	Administrative Services Agreement with Dreyfus Investment Portfolios, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(5)	Dreyfus Services Corporation Administrative Services Agreement Amendment No. 2 and Joinder dated 04/25/12 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(6)	Rule 12b-1 Agreement with Dreyfus Investment Portfolios, as amended (filed with the Commission on May 1, 2008 Accession No. 0000950137-08-006515)
(7)	Dreyfus Service Corporation 12b-1 Letter Agreement for Service Class Shares dated 03/26/2002 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(8)	Dreyfus Service Corporation 12b-1 Letter Agreement Amendment No. 2 and Joinder dated 04/25/2012 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(9)	Dreyfus Service Corporation 22c-2 Supplement Agreement dated 04/16/2007 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)

h. DWS
(1)	DWS Scudder Distributors, Inc. Participation Agreement dated 12/01/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(2)	DWS Investments Distributors, Inc. Amendment No. 1 to Participation Agreement dated 01/05/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	DWS Investments Distributors, Inc. Amendment No. 2 to Participation Agreement dated 05/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	DWS Investments Distributors, Inc. Amendment No. 3 and Joinder to Participation Agreement dated 12/18/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	DWS Investments Distributors, Inc. Amendment No. 4 to Participation Agreement dated 04/10/2013 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

i. Fidelity
(1)	Amended & Restated Participation Agreement with Fidelity Insurance Products Fund (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(2)	Distribution Agreement with Fidelity Variable Insurance Products Fund (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(3)	Service Agreement dated 03/26/2002 with Fidelity Variable Insurance Products Fund (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(4)	Rule 22c-2 Agreement with Fidelity Insurance Products Fund (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)

j. Franklin Templeton
(1)	Franklin Templeton Distributors, Inc. Amended and Restated Participation Agreement dated 11/01/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(2)	Franklin Templeton Distributors, Inc. Amendment No. 1 to Amended and Restated Participation Agreement dated 09/10/2009 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	Franklin Templeton Distributors, Inc. Amendment No. 2 to Amended and Restated Participation Agreement dated 08/16/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	Franklin Templeton Distributors, Inc. Addendum to the Amended and Restated Participation Agreement Addendum dated 05/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	Franklin Templeton Distributors, Inc. Amendment No. 3 to Amended and Restated Participation Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(6)	Franklin Templeton Distributors, Inc. Amendment No. 4 to Amended and Restated Participation Agreement dated 09/16/2013 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(7)	Franklin Templeton Distributors, Inc. Amendment No. 5 to Amended and Restated Participation Agreement dated 05/01/2014 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(8)	Franklin Templeton Services, LLC Administrative Services Agreement dated 12/14/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(9)	Franklin Templeton Services, LLC Amendment No. 1 to Administrative Services Agreement dated 09/10/2009 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(10)	Franklin Templeton Services, LLC Amendment No. 2 to Administrative Services Agreement dated 04/20/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(11)	Franklin Templeton Services, LLC Amendment No. 3 to Administrative Services Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(12)	Franklin Templeton Services, LLC Amendment No. 4 to Administrative Services Agreement dated 05/24/2013 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(13)	Franklin Templeton Services, LLC Amendment 5 to Administrative Services Agreement dated May 1, 2014 (filed with the Commission on 04/28/2017 Accession No. 0000009713-17-000048)
(14)	Franklin Templeton Services, LLC Amendment 6 to Administrative Services Agreement dated August 30, 2016 (filed with the Commission on 04/28/2017 Accession No. 0000009713-17-000048)
(15)	Franklin Templeton Distributors, Inc. Rule 22c-2 Agreement dated 04/16/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(16)	Franklin Templeton Amendment to Shareholder Information Agreement (22c-2) dated April 2015 (filed with the Commission on 04/30/2015 Accession No. 0000009713-15-000051)
(17)	Franklin Templeton Amendment to Participation Agreement Addendum dated March 31, 2015 (filed with the Commission on 04/30/2015 Accession No. 0000009713-15-000051)

k. Goldman Sachs
(1)	Goldman Sachs Variable Insurance Trust Participation Agreement dated 07/30/2004 (filed with the Commission for 333-116220 as Ex-99.8F1 on 05/01/2008 Accession No. 0000950137-08-006515)
(2)	Goldman Sachs Variable Insurance Trust Participation Agreement Amendment No. 1 dated 06/20/2008 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	Goldman Sachs Variable Insurance Trust Participation Agreement Amendment No. 2 dated 04/07/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	Goldman Sachs Variable Insurance Trust Participation Agreement Amendment No. 3 dated 10/26/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	Goldman Sachs & Co. Administrative Services Agreement dated 07/30/2004 (filed with the Commission for 333-116220 as Ex-99.8F2 on 05/01/2008 Accession No. 0000950137-08-006515)
(6)	Goldman Sachs & Co. Administrative Services Agreement Amendment No. 1 dated 06/20/2008 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(7)	Goldman Sachs & Co. Administrative Services Agreement Amendment No. 2 dated 10/26/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(8)	Goldman Sachs & Co. Rule 22c-2 Agreement dated 10/16/2007 (filed with the Commission for 333-116220 as Ex-99.8F3 on 05/01/2008 Accession No. 0000950137-08-006515)
(9)	Goldman Sachs & Co. Rule 22c-2 Agreement Amendment No. 1 dated 10/26/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

l. Guggenheim
(1)	Guggenheim Variable Funds Trust and Rydex Variable Trust Participation Agreement dated 05/01/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(2)	Guggenheim Funds Distributors, LLC Variable Product Services Agreement for the Rydex Variable Trust dated 05/01/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(3)	Guggenheim Funds Distributors, LLC Services Agreement dated 05/01/2015 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
(4)	Guggenheim Distributors, LLC FUND/SERV and Networking Agreement dated 10/28/2014 (filed with the Commission on 04/29/2016 Accession No. 0000009713-16-000210)
m. Invesco (formerly AIM Advisors, Inc.)
(1)	AIM Variable Insurance Funds, Inc. Participation Agreement dated 06/08/1999 as amended on 04/01/2001, 05/01/2002, 08/15/2002, 01/08/2003, 02/14/2003, 04/30, 2004, 04/29/2005 and 05/01/2006 (filed with the Commission for 333-116220 as Ex-99.8A1 on 05/01/2008 Accession No. 0000950137-08-006515)
(2)	AIM Variable Insurance Funds, Inc. Amendment to Participation Agreement dated 04/30/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	AIM Variable Insurance Funds Tenth Amendment to Participation Agreement dated 04/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	AIM Variable Insurance Funds Eleventh Amendment & Joinder to Participation Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	AIM Distributors, Inc. Distribution Services Agreement dated 10/01/2002 (filed with the Commission for 333-116220 as Ex-99.8A2 on 05/01/2008 Accession No. 0000950137-08-006515)
(6)	AIM Investment Services, Inc. Rule 22c-2 Agreement dated 04/16/2007 (filed with the Commission for 333-116220 as Ex-99.8A3 on 05/01/2008 Accession No. 0000950137-08-006515)
(7)	AIM Investment Services, Inc. First Amendment & Joinder to the Rule 22c-2 Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(8)	AIM Advisors, Inc. Administrative Services Agreement dated 06/08/1999 (filed with the Commission for 333-116220 as Ex-99.8A4 on 05/01/2008 Accession No. 0000950137-08-006515)
(9)	AIM Advisors, Inc. Administrative Services Agreement Amendment 1 dated 04/30/2004 (filed with the Commission for 333-116220 as Ex-99.8A1 on 05/01/2008 Accession No. 0000950137-08-006515)
(10)	AIM Advisors, Inc. Administrative Services Agreement Second Amendment & Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

n. MFS
(1)	MFS Fund Distributors, Inc. Amended and Restated Participation Agreement dated 05/01/2013 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(2)	MFS Fund/Serv and Networking Agreement to Amended and Restated Participation Agreement dated 05/01/2013 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	MFS Fund Distributors, Inc. Amended & Restated Administrative Services Letter Agreement dated 04/01/2016 (filed with the Commission on 04/28/2017 Accession No. 0000009713-17-000048)
(4)	MFS Variable Insurance Trust Website Regulatory Document Agreement dated 03/06/2008 (filed with the Commission for 333-116220 as Ex-99.8J12 on 04/30/2010 Accession No. 0000898745-10-000129)
(5)	MFS Fund Distributors, Inc. Rule 22c-2 Shareholder Information Agreement dated 10/16/2007 (filed with the Commission for 333-116220 as Ex-99.8J13 on 04/30/2010 Accession No. 0000898745-10-000129)
(6)	MFS Fund Distributors, Inc. Amendment No. 1 to Rule 22c-2 Shareholder Information Agreement dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

o. Neuberger Berman
(1)	Participation Agreement with Neuberger Berman Advisers Management Trust, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(2)	Neuberger Berman Advisers Management Trust Fund Participation Agreement Amendment No. 4 and Joinder dated 11/01/2011 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(3)	Distribution & Administrative Services Agreement with Neuberger Berman Advisers Management Trust (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(4)	Neuberger Berman Management LLC Distribution and Administrative Services Agreement Amendment No. 1 and Joinder dated 11/01/2011 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(5)	Rule 22c-2 Agreement with Neuberger Berman Advisers Management Trust (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(6)	Neuberger Berman Advisers Management Trust Rule 22c-2 Agreement Amendment No. 1 and Joinder dated 11/01/2011 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)

p. PIMCO
(1)	Participation Agreement with PIMCO Variable Insurance Trust dtd 03/09/09– (filed with the Commission for 333-116220 as Ex-99.B (8k1) on 3/01/10 Accession No. 0000898745-10-000129)
(2)	PIMCO Variable Insurance Trust Novation of and Amendment to Participation Agreement dated 10/22/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	PIMCO Variable Insurance Trust Participation Agreement Novation No. 1 dated 10/22/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	PIMCO Variable Insurance Trust Participation Agreement Novation No. 2 dated 10/22/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	PIMCO Variable Insurance Trust Participation Agreement Instrument of Accession and Amendment dated 08/29/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(6)	PIMCO Variable Insurance Trust Administrative Services Agreement for Administrative Class Shares dated 03/09/09 (filed with the Commission for 333-116220 as Ex-99.B (8k2) on 03/01/10 Accession No. 0000898745-10-000129)
(7)	PIMCO Variable Insurance Trust Administrative Services Agreement for Administrative Class Shares Amendment No. 1 dated 04/22/09 (filed with the Commission for 333-116220 as Ex-99.B (8k3) on 03/01/10 Accession No. 0000898745-10-000129)
(8)	PIMCO Variable Insurance Trust Administrative Services Agreement Assignment and Amendment dated 03/29/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

q. Principal Variable Contracts Funds, Inc.
(1)	Principal Variable Contracts Funds, Inc. Participation Agreement dated 01/05/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(2)	Principal Variable Contracts Funds, Inc. Participation Agreement Amendment No. 1 dated 06/01/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	Principal Variable Contracts Funds, Inc. Participation Agreement Amendment No. 2 dated 01/01/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	Principal Variable Contracts Funds, Inc. Participation Agreement Amendment No. 3 (letter) dated 06/17/2010 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(5)	Principal Variable Contracts Funds, Inc. Participation Agreement Amendment No. 3 and Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(6)	Principal Variable Contracts Fund, Inc. Participation Agreement Amendment No. 5 dated 02/09/2015 (filed with the Commission on 04/30/2015 Accession No. 0000009713-15-000051)
(7)	Principal Variable Contracts Fund, Inc. Participation Agreement Amendment No. 6 dated 08/10/2016 (filed with the Commission on 04/28/2017 Accession No. 0000009713-17-000048)
(8)	Principal Variable Contracts Fund, Inc. Rule 12b-1 Compensation Letter dated 12/30/2009 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(9)	Principal Variable Contracts Fund, Inc. Amendment to Rule 12b-1 Compensation Letter dated 11/09/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(10)	Principal Variable Contracts Funds, Inc. Rule 22c-2 Agreement dated 04/16/2007 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(11)	Principal Variable Contracts Funds, Inc. Rule 22c-2 Agreement Amendment No. 1 and Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)

r. T. Rowe Price
(1)	Participation Agreement with T Rowe Equity Series Inc, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(2)	Administrative Services Agreement with T. Rowe Equity Series Inc, as amended (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-06515)
(3)	T. Rowe Price Administrative Services Agreement Letter Amendment No. 2 dated 03/16/2012 (filed with the commission on 02/23/2015 Accession No. 0000009713-15-000007)
(4)	Rule 12b-1 Agreement with T Rowe Equity Series Inc (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(5)	Rule 22c-2 Agreement with T Rowe Equity Series Inc (filed with the Commission for 333-116220 on 05/01/2008 0000950137-08-006515)
(6)	Participation Agreement Amendment with T. Rowe Equity Series Inc. dated 05/01/2017 (filed with the Commission on 04/29/2019 Accession No. 0000009713-19-000038)

s. Van Eck
(1)	Participation Agreement with Van Eck Worldwide Insurance Trust dtd 11/28/07 Filed as Ex-99.b(8l1) on 3/01/10 (Accession No. 0000898745-10-000129)
(2)	Van Eck Worldwide Insurance Trust Participation Agreement Amendment No. 1 dated 04/24/2009 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(3)	Van Eck VIP Trust Participation Agreement Amendment No. 2 and Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(4)	Van Eck Securities Corporation Service Agreement dated 11/28/2007 (filed with the Commission for 333-116220 as Ex-99.8L3 on 03/01/2010 Accession No. 0000898745-10-000129)
(5)	Van Eck Securities Corporation Service Agreement Amendment No. 1 dated 04/24/2009 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(6)	Van Eck Securities Corporation Service Agreement Amendment No. 2 dated 05/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(7)	Van Eck Securities Corporation Service Agreement Amendment No. 2 and Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(8)	Van Eck Securities Corporation Service Agreement Amendment No. 4 dated 05/01/2012 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(9)	Van Eck Securities Corporation Shareholder Information Agreement (Rule 22c-2) dated 11/28/2007 (filed with the Commission for 333-116220 as Ex-99.8L2 on 03/01/2010 Accession No. 0000898745-10-000129)
(10)	Van Eck Securities Corporation Shareholder Information Agreement (Rule 22c-2) Amendment No. 1 and Joinder dated 11/01/2011 (filed with the Commission on 10/07/2014 Accession No. 0000009713-14-000086)
(11)	Van Eck Securities Corporation Service Agreement Amendment No. 5 dated 05/01/2018 (filed with the Commission on 04/29/2019 Accession No. 0000009713-19-000038)
(12)	Van Eck Securities Corporation Service Agreement Amendment No. 6 dated 10/15/2019 *

(9)	Opinion of Counsel *
(10a)	Consent of Ernst & Young LLP *
(10b)	Powers of Attorney (filed with the Commission on 04/27/2018 Accession No. 0000009713-18-000050) and filed herein *
(10c)	Consent of Counsel *
(11)	Financial Statement Schedules *

* Filed Herein

** To be filed by amendment

Item 25. Officers and Directors of the Depositor

Principal Life Insurance Company is managed by a Board of Directors which is elected by its policyowners. The directors and executive officers of the Company, their positions with the Company, including Board Committee memberships, and their principal business address, are as follows:

DIRECTORS:

Name and Principal Business Address	Positions and Offices
JONATHAN S. AUERBACH PayPal 2211 North First Street San Jose, CA 95131	Director Member, Nominating and Governance Committee
BETSY J. BERNARD 28556 Chianti Terrace Bonita Springs, FL 34135	Director Chair, Human Resources Committee Member, Audit and Executive Committees
JOCELYN CARTER-MILLER 8701 Banyan Court Tamarac, FL 33321	Director Member, Nominating and Governance Committee
MICHAEL T. DAN 563 Love Road Lyndhurst, VA 22952	Director Member, Human Resources and Nominating and Governance Committees
C. DANIEL GELATT, JR. NMT Corporation 2004 Kramer Street La Crosse, WI 54603	Director Member, Audit and Human Resources Committees
SANDRA L. HELTON 1040 North Lake Shore Drive #26A Chicago, IL 60611	Director Chair, Audit Committee Member, Executive Committee
ROGER C. HOCHSCHILD Discover Financial Services 2500 Lake Cook Road Riverwoods, IL 60015	Director Chair, Nominating and Governance Committee
DANIEL J. HOUSTON Principal Financial Group Des Moines, IA 50392	Director Chairman of the Board and Chair, Executive Committee Principal Life: Chairman, President and Chief Executive Officer
SCOTT M. MILLS BET Networks 1515 Broadway, 22nd Floor New York, NY 10036	Director Member, Audit and Human Resources Committees
DIANE C. NORDIN 140 Monument Street Concord, MA 01742	Director Member, Audit and Human Resources Committee
BLAIR C. PICKERELL Lower House 1 29 Mt. Kellett Road The Peak Hong Kong	Director Member, Nominating and Governance Committee
ELIZABETH E. TALLETT 21 Deepwater Point Moultonborough, NH 03254	Director Member, Executive, Human Resources and Nominating and Governance Committees

EXECUTIVE OFFICERS (OTHER THAN DIRECTORS)

Name and Principal Business Address	Positions and Offices
DAVID M. BLAKE(1)	Senior Executive Director - Fixed Income
PEDRO BORDA(1)	Senior Vice President and Chief Operating Officer - Principal International
NICHOLAS M. CECERE(1)	Senior Vice President - USIS Distribution
WEE YEE (THOMAS) CHEONG(3)	Senior Vice President - President, Principal Asia
JON N. COUTURE(1)	Senior Vice President and Chief Human Resources Officer
TIMOTHY M. DUNBAR(1)	President - Principal Global Asset Management
AMY C. FRIEDRICH(1)	President U.S. Insurance Solutions
GINA L. GRAHAM(1)	Vice President and Treasurer
PATRICK G. HALTER(1)	Chief Executive Officer and President - Principal Global Investors
ELIZABETH B. HAPPE(1)	Senior Vice President and Chief Compliance Officer
KARA M. HOOGENSEN(1)	Senior Vice President Specialty Benefits
MARK S. LAGOMARCINO(1)	Senior Vice President and Deputy General Counsel
JULIA M. LAWLER(1)	Executive Vice President and Chief Risk Officer
GREGORY A. LINDE(1)	Senior Vice President Individual Life
CHRISTOPHER J. LITTLEFIELD(1)	Executive Vice President, General Counsel and Secretary
BARBARA A. MCKENZIE(1)	Senior Executive Director - Investments
DENNIS J. MENKEN(1)	Senior Vice President and Chief Investment Officer - Principal Life Insurance Company
GERALD W. PATTERSON(1)	Senior Vice President Retirement and Income Solutions
SRINIVAS D. REDDY(1)	Senior Vice President - Retirement and Income Solutions
ANGELA R. SANDERS(1)	Senior Vice President and Controller
RENEE V. SCHAAF(1)	President - Retirement and Income Solutions
GARY P. SCHOLTEN(1)	Executive Vice President, Chief Information Officer and Chief Digital Officer
KAREN E. SHAFF(1)	Executive Vice President and Chief Legal Officer
ELLEN W. SHUMWAY(1)	Senior Executive Director - Strategy and Investments
DEANNA D. STRABLE(1)	Executive Vice President and Chief Financial Officer
LUIS E. VALDES(1)	President - International Asset Management and Accumulation
LEANNE M. VALENTINE(1)	Senior Vice President and Deputy General Counsel
ROBERTO WALKER(2)	Senior Vice President and President, Principal Financial Group - Latin America
BETHANY A. WOOD(1)	Senior Vice President and Chief Marketing Officer
(1)	711 High Street
	Des Moines, IA 50392
(2)	Principal Vida Chile
	Av Apoquindo 3600
	Las Condes
	Santiago, Chile
(3)	Unit 1001-2 Central Plaza
	18 Harbour Road
	Wan Chai, Hong Kong

Item 26. Persons Controlled by or Under Common Control with the Depositor or the Registrant

The Registrant is a separate account of Principal Life Insurance Company (the "Depositor") and is operated as a unit investment trust. Registrant supports benefits payable under Depositor's variable life contracts by investing assets allocated to various investment options in shares of Principal Variable Contracts Funds, Inc. and other mutual funds registered under the Investment Company Act of 1940 as open-end management investment companies of the "series" type. No person is directly or indirectly controlled by the Registrant.

The Depositor is wholly-owned by Principal Financial Services, Inc. Principal Financial Services, Inc. (an Iowa corporation) an intermediate holding company organized pursuant to Section 512A.14 of the Iowa Code. In turn, Principal Financial Services, Inc. is a wholly-owned subsidiary of Principal Financial Group, Inc., a publicly traded company that filed consolidated financial statements with the SEC. A list of persons directly or indirectly controlled by or under common control with Depositor as of December 31, 2019 appears below:

None of the companies listed in such organization chart is a subsidiary of the Registrant; therefore, only the separate financial statements of Registrant and the consolidated financial statements of Depositor are being filed with this Registration Statement.

Principal Life Insurance Company - Organizational Structure
(December 31, 2019)
							Organized in	% Owned
PRINCIPAL FINANCIAL GROUP, INC.							Delaware	Publicly Held
	-->Principal Financial Services, Inc.*#						Iowa	100
		-->PFG DO Brasil LTDA*#					Brazil	100
			-->Brasilprev Seguros E Previdencia S.A.*				Brazil	50
			-->Principal Global Investors Participacoes, LTDA*#				Brazil	100
			-->Claritas Investments LTD*#				Cayman Islands	100
			-->Claritas Administracao de Recursos LTDA*#				Brazil	73.75
			-->PFG Do Brasil 2 Participacoes LTDA*#				Brazil	100
				-->Ciclic Corretora de Seguros S.A.*#			Brazil	50.01
		-->Principal International, LLC.*#					Iowa	100
			-->Principal International (Asia) Limited*#				Hong Kong	100
				-->Principal Asia Pacific Investment Consulting (Beijing) Limited*#			China	100
				-->Principal International (South Asia) SDN, BHD*#			Malaysia	100
				-->Principal Nominee Company (Hong Kong) Limited*#			Hong Kong	100
				-->Principal Asset Management Company (Asia) Limited*#			Hong Kong	100
				-->Principal Trust Company (Hong Kong) Limited*			Hong Kong	100
				-->Principal Insurance Company (Hong Kong) Limited*#			Hong Kong	100
					-->Principal Trust Company (Bermuda) Limited*#		Bermuda	100
				-->Principal Asset Management Berhad*			Malaysia	60
					-->CIMB Wealth Advisors Berhad*		Malaysia	100
					-->PT Principal Asset Management		Indonesia	99
					-->Principal Asset Management (S) PTE LTD*#		Singapore	100
					-->Principal Asset Management Company Limited*		Thailand	100
					-->PT Principal Asset Management*		Indonesia	99
				-->Principal Trust Company (Asia) Limited*#			Hong Kong	100
				-->Principal Investment & Retirement Services Limited*#			Hong Kong	100
			-->Principal Consulting (India) Private Limited*#				India	100
		-->Principal Global Investors Holding Company, LLC*#					Delaware	100
			-->Principal Global Investors (Ireland) Limited*#				Ireland	100
			-->Principal Global Financial Services (Europe) II LTD*#				United Kingdom	100
				-->Principal Global Investors (Europe) Limited*			Wales/United Kingdom	100
				-->Principal Global Investors (EU) Limited*			Ireland	100
					-->Principal Global Investors (Switzerland) GMBH*		Switzerland	100
				-->PGI Origin Holding Company LTD*#<			Wales/United Kingdom	100
					-->Origin Asset Management LLP*#<		Wales/United Kingdom	85.52
				-->PGI Finisterre Holding Company LTD*			Wales/United Kingdom	100
				-->Finisterre Holdings Limited*			Malta	95.8
					-->Finisterre Capital UK Limited*		Wales/United Kingdom	100
						-->Finisterre Capital LLP*	Wales/United Kingdom	86
					-->Finisterre Malta Limited*		Malta	100
					-->Finisterre USA, Inc.*		Delaware	100
				-->Principal Corporate Secretarial Services Limited			Wales/United Kingdom	100
				-->Principal Real Estate Europe Limited			Wales/United Kingdom	100
					-->Principal Opportunity Fund LP		Wales/United Kingdom	100
					-->Principal Real Estate Limited		Wales/United Kingdom	100
						-->Benelux Industrial Partnership General Partner B.V.	Netherlands	100

				-->INTERNOS Real Estate Limited	Wales/United Kingdom	100
				-->Principal Hotel Immobilienfonds II General Partner S.ã.r.l.	Luxembourg	100
				-->Principal Real Estate B.V.	Netherlands	100
				-->Principal Real Estate GmbH	Germany	100
				-->Principal Real Estate Kapitalverwaltungsgesellschaft mbH	Germany	94.9
				-->Principal Real Estate S.ã.r.l.	Luxembourg	100
				-->Principal Real Estate SAS	France	100
				-->Principal Real Estate S.L.	Spain	100
			-->Principal Real Estate Spezialfondsgesellschaft mbH		Germany	94.9
	-->Principal Global Investors (Singapore) Limited*#				Singapore	100
	-->Principal Global Investors (Japan) Limited*#				Japan	100
	-->Principal Global Investors (Hong Kong) Limited*#				Hong Kong	100
-->Principal Global Investors Holding Company (US), LLC*#					Delaware	100
	-->Spectrum Asset Management, Inc.*#<				Connecticut	100
		-->SAMI Brokerage LLC			Connecticut	100
	-->CCIP, LLC*#<				Delaware	100
		--> Columbus Circle Investors*#<			Delaware	100
	-->Post Advisory Group, LLC*#<				Delaware	78.25
	--> Principal Commercial Funding, LLC*#<				Delaware	100
	-->Principal Global Columbus Circle, LLC*#<				Delaware	100
		--> CCI Capital Partners, LLC *#<			Delaware	100
	-->Principal Enterprise Capital, LLC*#				Delaware	100
	-->Principal Global Investors, LLC*#<				Delaware	100
	-->Principal Real Estate Investors, LLC*#				Delaware	100
	-->Principal Financial Advisors, Inc.*#				Iowa	100
	-->Principal Global Investors Trust Company*#				Oregon	100
	-->Principal Shareholder Services, Inc.*#				Washington	100
	-->Principal Funds Distributor, Inc.*#				Washington	100
-->Principal Islamic Asset Management SDN. BHD*#					Malaysia	60
-->Principal Financial Group (Mauritius) LTD*#					Mauritius	100
	-->Principal Asset Management Private Limited*#				India	78.6
	-->Principal Trustee Company Private Limited*#				India	70
	-->Principal Retirement Advisors Private Limited*#				India	100
-->Principal Life Insurance Company+#					Iowa	100
	-->Principal Real Estate Fund Investors, LLC*#<				Delaware	100
	-->Principal Development Investors, LLC*#<				Delaware	100
	-->Principal Real Estate Holding Company, LLC*#<				Delaware	100
		-->GAVI PREHC HC, LLC*#<			Delaware	100
	-->Principal Holding Company, LLC*#<				Iowa	100
		-->Petula Associates, LLC*<			Iowa	100
			-->Principal Real Estate Portfolio, Inc.*#<		Delaware	100
				-->GAVI PREPI HC, LLC*#<	Delaware	100
			-->Petula Prolix Development Company, LLC*#<		Iowa	100
			-->Principal Commercial Acceptance, LLC*#<		Delaware	100
		-->Principal Generation Plant, LLC*#<			Delaware	100
		-->Principal Bank*#<			Iowa	100
			-->Principal Advised Services, LLC		Delaware	100
		-->Equity FC, LTD*#<			Iowa	100
		-->Principal Dental Services, Inc.*#<			Arizona	100
			-->Employers Dental Services, Inc.*#<		Arizona	100
		-->First Dental Health*#<			California	100
		-->Delaware Charter Guarantee & Trust Company*#<			Delaware	100
		-->Preferred Product Network, Inc.*#<			Delaware	100
	-->Principal Reinsurance Company of Vermont*#				Vermont	100
	-->Principal Life Insurance Company of Iowa*#<				Iowa	100
		-->Principal Reinsurance Company of Delaware*#<			Delaware	100
		-->Principal Reinsurance Company of Delaware II*#<			Delaware	100
-->Principal International Holding Company, LLC*#					Delaware	100

-->Principal Global Services Private Limited*#

India

100

-->Principal Global Services (Philippines) LLC

Philippines

100

-->Veloxiti Commercial Contracting, Inc.

Delaware

40

-->CCB Principal Asset Management Company, LTD*

China

25

-->Principal Financial Services I (US), LLC*#

Delaware

100

-->Principal Financial Services II (US), LLC*#

Delaware

100

-->Principal Financial Services I (UK) LLP *#

Wales/United Kingdom

100

-->Principal Financial Services IV (UK) LLP*#

United Kingdom

100

-->Principal Financial Services V (UK) LTD.*#

United Kingdom

100

-->Principal Financial Services II (UK) LTD.*#

Wales/United Kingdom

100

-->Principal Financial Services III (UK) LTD.*#

Wales/United Kingdom

100

-->Principal Financial Services Asia (UK) LTD*#

United Kingdom

100

-->Principal Global Investors Asia (UK) Ltd

United Kingdom

100

-->Principal International Asia (UK) Ltd

United Kingdom

100

-->Principal Global Investors (Australia) Service Company Pty Limited*#

Australia

100

-->Principal Global Investors (Australia) Limited*#

Australia

100

-->Principal Global Investors (Japan) Limited*#

Japan

100

-->Principal International India LTD*#

United Kingdom

100

-->Principal Financial Services VI (UK) LTD*#

United Kingdom

100

-->Principal Global Financial Services (Europe) LTD*#

United Kingdom

100

-->Liongate Limited*

Malta

100

-->Liongate Capital Management (Cayman) Limited*

Cayman Islands

100

-->Liongate Capital Management LLP*

Wales/United Kingdom

100

-->Principal Financial Services Latin America LTD.*#

Wales/United Kingdom

100

-->Principal International Latin America LTD.*#

United Kingdom

100

-->Principal International Mexico, LLC*#

Delaware

100

-->Principal Mexico Servicios, S.A. de C.V.*#

Mexico

100

-->Principal Financial Group, S.A. de C. V. Grupo Financiero*#

Mexico

100

-->Principal Afore, S. A. de C.V., Principal Grupo Financiero*#

Mexico

100

-->Principal Fondos de Inversion S.A. de C.V., Operadora de Fondos de Inversion, Principal Grupo Financiero*#

Mexico

100

-->Principal Seguros, S.A. de C.V., Principal Grupo Financiero*#

Mexico

100

-->Principal Pensiones, S.A. de C.V., Principal Grupo Financiero*#

Mexico

100

-->Principal International South America I LTD.*#

Wales/United Kingdom

100

-->Principal International South America II LTD.*#

Wales/United Kingdom

100

-->Principal International South America II LTD., Agencia En Chile*#

Chile/United Kingdom

100

-->Principal International de Chile, S.A.*#

Chile

100

-->Principal Compania de Seguros de Vida Chile S.A.*#

Chile

100

-->Principal Administradora General de Fondos S.A.*#

Chile

100

-->Principal Ahorro e Inversiones S.A.*#

Chile

100

-->Principal Servicios Corporativos Chile LTDA*#

Chile

100

-->Principal Servicios de Administracion S.A.*#

Chile

100

-->Hipotecaria Security Principal, S.A.*

Chile

49

-->Principal Holding Company Chile S.A.*#

Chile

100

-->Principal Chile Limitada*#

Chile

100

-->Administradora de Fondos de Pensiones Cuprum S.A.*#

Chile

97

-->Inversiones Cuprum Internacional S.A.*#

Chile

100

-->Principal National Life Insurance Company+#

Iowa

100

-->Principal Enterprise Services (India) LLP

India

100

-->Principal Securities, Inc.

Iowa

100

-->Diversified Dental Services, Inc.*#

Nevada

100

-->Principal Investors Corporation*#

New Jersey

100

-->Principal Innovations, Inc.

Delaware

90.24

-->RobustWealth, Inc.

Delaware

100

+ Consolidated financial statements are filed with the SEC.

* Not required to file financial statements with the SEC.

# Included in the consolidated financial statements of Principal Financial Group, Inc. filed with the SEC.

= Separate Financial statements are filed with SEC.

< Included in the financial statements of Principal Life Insurance Company filed with the SEC.

Item 27. Number of Contractowners - As of March 31, 2020

(1)	(2)
	Number of
Title of Class	Contractowners
BFA Variable Annuity Contracts	6
Pension Builder Plus Contracts	51
Personal Variable Contracts	2
Premier Variable Contracts	7
Flexible Variable Annuity Contract	15,144
Freedom Variable Annuity Contract	620
Freedom 2 Variable Annuity Contract	209
Investment Plus Variable Annuity Contract	55,765
Principal Lifetime Income Solutions	925
Principal Pivot Series Variable Annuity	2,638
Principal Lifetime Income Solutions II	8,207

Item 28. Indemnification

Sections 490.851 through 490.859 of the Iowa Business Corporation Act permit corporations to indemnify directors and officers where (A) all of the following apply: the director or officer (i) acted in good faith; (ii) reasonably believed that (a) in the case of conduct in the individual's official capacity, that the individual's conduct was in the best interests of the corporation or (b) in all other cases, that the individual's conduct was at least not opposed to the best interests of the corporation; and (iii) in the case of any criminal proceeding, the individual had no reasonable cause to believe the individual's conduct was unlawful; and (B) the individual engaged in conduct for which broader indemnification has been made permissible or obligatory under a provision of the corporation's articles of incorporation.

Unless ordered by a court pursuant to the Iowa Business Corporation Act, a corporation shall not indemnify a director or officer in either of the following circumstances: (A) in connection with a proceeding by or in the right of the corporation, except for reasonable expenses incurred in connection with the proceeding if it is determined that the director has met the relevant standard of conduct (above) or (B) in connection with any proceeding with respect to conduct for which the director was adjudged liable on the basis that the director receive a financial benefit to which he or she was not entitled, whether or not involving action in the director's official capacity.

Registrant's By-Laws provide that it shall indemnify directors and officers against damages, awards, settlements and costs reasonably incurred or imposed in connection with any suit or proceeding to which such person is or may be made a party by reason of being a director or officer of the Registrant. Such rights of indemnification are in addition to any rights to indemnity to which the person may be entitled under Iowa law and are subject to any limitations imposed by the Board of Directors. The Board has provided that certain procedures must be followed for indemnification of officers, and that there is no indemnity of officers when there is a final adjudication of liability based upon acts which constitute gross negligence or willful misconduct.

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

Item 29. Principal Underwriters

(a)Other Activity

Principal Securities, Inc. acts as principal underwriter for variable annuity contracts issued by Principal Life Insurance Company Separate Account B, a registered unit investment trust and for variable life insurance contracts issued by Principal Life Insurance Company Variable Life Separate Account, a registered unit investment trust.

(b)Management

(b1)	(b2)
Name and principal	Positions and offices
business address	with principal underwriter
Meaghan Alvarez	Vice President/Chief Compliance Officer
Principal Financial Group(1)
Carla Beitzel	Vice President/Distribution
Principal Financial Group(1)
Nicholas M. Cecere	Senior Vice President and Director
Principal Financial Group(1)
Scott A. Christensen	Chief Financial Officer
Principal Financial Group(1)
Chad Claire	Chief Information Officer
Principal Financial Group(1)
Amy C. Friedrich	Director
Principal Financial Group(1)
Bill Froehlich	Vice President, Operations
Principal Financial Group(1)
Gina L. Graham	Vice President and Treasurer
Principal Financial Group(1)
Doug Hodgson	Counsel
Principal Financial Group(1)
Grady Holt	Vice President - Advisory Services
Principal Financial Group(1)
Chantel M. Kramme	Counsel
Principal Financial Group(1)
Julia M. Lawler	Director
Principal Financial Group(1)
Julie LeClere	Chief Operating Officer
Principal Financial Group(1)
Casey Mathias	Vice President
Principal Financial Group(1)
Michael F. Murray	Chairman, President and Chief Executive Officer
Principal Financial Group(1)
Doug Rants	Chief Information Security Officer
Principal Financial Group(1)

Karen E. Shaff	Executive Vice President/General Counsel/Corporate Secretary
Principal Financial Group(1)
Craig Spadafora	Senior Vice President
Principal Financial Group(1)
Deanna D. Strable-Soethout	Director
Principal Financial Group(1)
Traci L. Weldon	Senior Vice President
Principal Financial Group(1)
Dan L. Westholm	Assistant Vice President - Treasury
Principal Financial Group(1)
Clint L. Woods	Assistant Vice President - Treasury
Principal Financial Group(1)
(1)   655 9th Street
Des Moines, IA 50309

(c)Compensation from the Registrant

(1) Name of Principal Underwriter	(2) Net Underwriting Discounts & Commissions	(3) Compensation on Events Occasioning the Deduction of a Deferred Sales Load	(4) Brokerage Commissions	(5) Compensation
Principal Securities, Inc.	$39,265,417.97	0	0	0

Item 30. Location of Accounts and Records

All accounts, books or other documents of the Registrant are located at the offices of the Depositor, The Principal Financial Group, Des Moines, Iowa 50392.

Item 31. Management Services

N/A

Item 32. Undertakings

The Registrant undertakes that in restricting cash withdrawals from Tax Sheltered Annuities to prohibit cash withdrawals before the Participant attains age 59 1/2, separates from service, dies, or becomes disabled or in the case of hardship, Registrant acts in reliance on SEC No Action Letter addressed to American Counsel of Life Insurance (available November 28, 1988). Registrant further undertakes that:

1. Registrant has included appropriate disclosure regarding the redemption restrictions imposed by Section 403(b)(11) in its registration statement, including the prospectus, used in connection with the offer of the contract;

2. Registrant will include appropriate disclosure regarding the redemption restrictions imposed by Section 403(b)(11) in any sales literature used in connection with the offer of the contract;

3. Registrant will instruct sales representatives who solicit Plan Participants to purchase the contract specifically to bring the redemption restrictions imposed by Section 403(b)(11) to the attention of the potential Plan Participants; and

4. Registrant will obtain from each Plan Participant who purchases a Section 403(b) annuity contract, prior to or at the time of such purchase, a signed statement acknowledging the Plan Participant's understanding of (a) the restrictions on redemption imposed by Section 403(b)(11), and (b) the investment alternatives available under the employer's Section 403(b) arrangement, to which the Plan Participant may elect to transfer his contract value.

Fee Representation

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

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant, Principal Life Insurance Company Separate Account B, has duly caused this Amendment to the Registration Statement to be signed on its behalf by the undersigned thereto duly authorized, and its seal to be hereunto affixed and attested, in the City of Des Moines and State of Iowa, on the 28th day of April, 2020.

	PRINCIPAL LIFE INSURANCE COMPANY
	SEPARATE ACCOUNT B
	(Registrant)
	By :	/s/ D. J. Houston
		D. J. Houston
		Chairman, President and Chief Executive Officer
	PRINCIPAL LIFE INSURANCE COMPANY
	(Depositor)
	By :	/s/ D. J. Houston
		D. J. Houston
		Chairman of the Board
		Director, Chairman, President and Chief Executive Officer
Attest:
/s/ Clint Woods
Clint Woods
Assistant Corporate Secretary and Governance Officer

Pursuant to the requirements of the Securities Act, this amendment to the registration statement has been signed by the following persons in the capacities and on the date indicated.

Signature	Title	Date
/s/ D. J. Houston	Director, Chairman of the Board	April 28, 2020
D. J. Houston	Chairman, President, and Chief Executive Officer
/s/ A. R. Sanders	Senior Vice President and Controller	April 28, 2020
A. R. Sanders	(Principal Accounting Officer)
/s/ D. D. Strable-Soethout	Executive Vice President and	April 28, 2020
D. D. Strable-Soethout	Chief Financial Officer
	(Principal Financial Officer)
(J. S. Auerbach)*	Director	April 28, 2020
J. S. Auerbach
(B. J. Bernard)*	Director	April 28, 2020
B. J. Bernard
(J. Carter-Miller)*	Director	April 28, 2020
J. Carter-Miller
(M. T. Dan)*	Director	April 28, 2020
M. T. Dan
(C. D. Gelatt, Jr.)*	Director	April 28, 2020
C. D. Gelatt, Jr.
(S. L. Helton)*	Director	April 28, 2020
S. L. Helton
(R. C. Hochschild)*	Director	April 28, 2020
R. C. Hochschild
(S. M. Mills)*	Director	April 28, 2020
S. M. Mills
(D. C. Nordin)*	Director	April 28, 2020
D. C. Nordin
(B. C. Pickerell)*	Director	April 28, 2020
B. C. Pickerell
(E. E. Tallett)*	Director	April 28, 2020
E. E. Tallett
*By	/s/ D. J. Houston
	D. J. Houston
	Director, Chairman of the Board
	Chairman, President and Chief Executive Officer
*	Pursuant to Powers of Attorney  Previously Filed on April 27, 2018 and Filed Herein