<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Post-Effective Amendment No. 1 (File No. 333-00041)
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 X
Amendment No. 2 (File No. 811-07475)
ACL VARIABLE ANNUITY ACCOUNT 1
___________________________________________________________________
(Exact Name of Registrant)
American Centurion Life Assurance Company
___________________________________________________________________
(Name of Depositor)
20 Madison Avenue Extension, Albany, NY 12203
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 671-3678
Mary Ellyn Minenko, IDS Tower 10, Minneapolis, MN 55440-0010
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (Check
approprate box)
_____immediately upon filing pursuant to paragraph (b) of Rule 485
X on November 18, 1996 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
If appropriate check the following box:
_____this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
The Registrant has registered an indefinite number or amount of
securities under the Securities Act of 1933 pursuant to Section
24-f of the Investment Company Act of 1940.
<PAGE>
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CROSS REFERENCE SHEET
Cross reference sheet showing location in the prospectus and
Statement of Additional Information of the information called for
by the items enumerated in Part A and B of Form N-4.
Negative answers omitted from prospectus and Statement of
Additional Information are so indicated.
<TABLE>
<CAPTION>
PART A PART B
Section in
Section Statement of
Item No. in Prospectus Item No. Additional Information
<C> <C> <C> <C>
1 Cover page 15 Cover page
2 Key terms 16 Table of contents
3(a) Expense summary 17(a) NA
(b) The Annuity in brief (b) NA
(c) About American Centurion Life*
4(a) Condensed financial
information 18(a) NA
(b) Performance information (b) NA
(c) Financial statements (c) Independent auditors
(d) NA
5(a) Cover page; About (e) NA
American Centurion Life (f) NA
(b) The variable account
(c) The funds 19(a) Distribution of the contracts*
(d) Cover page; The funds About American Centurion Life*
(e) Voting rights (b) NA
(f) NA
(g) NA 20(a) Principal underwriter
(b) Principal underwriter
6(a) Charges (c) NA
(b) Charges (d) NA
(c) Charges
(d) NA 21(a) Performance information
(e) The funds (b) Performance information
(f) NA
22 Calculating Annuity Payouts
7(a) Buying your annuity;
Benefits in case of 23(a) Financial Statements
death; (b) Financial Statements
The annuity payout
period
(b) The variable account;
Making the most of your
annuity
(c) The funds; Charges
(d) Cover page
8(a) The annuity payout period
(b) Buying the annuity
(c) The annuity payout period
(d) The annuity payout period
(e) The annuity payout period
(f) The annuity payout period
9(a) Benefits in case of death
(b) Benefits in case of death
10(a) Buying your annuity;
Valuing your investment
(b) Valuing your investment
(c) Buying your annuity; Valuing
your investment
(d) About American Centurion Life
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PAGE 3
11(a) Surrendering your contract
(b) NA
(c) Surrendering your contract
(d) Buying your annuity
(e) The annuity in brief
12(a) Taxes
(b) Key terms
(c) NA
13 NA
14 Table of contents of the
Statement of Additional Information
*Designates section in the prospectus, which is hereby incorporated by reference
in this Statement of Additional Information.
</TABLE>
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Privileged Assets (registered trademark symbol) Select Annuity
Prospectus/November 18, 1996
The Privileged Assets (registered trademark symbol) Select Annuity
is a flexible premium group deferred fixed/variable annuity.
The annuity is available for non-qualified and certain qualified
retirement plans.
ACL Variable Annuity Account 1
Sold by: American Centurion Life Assurance Company
(American Centurion Life).
Service Office: 20 Madison Avenue Ext. Albany, NY 12203
Telephone: (518) 452-4150
THIS PROSPECTUS CONTAINS THE INFORMATION ABOUT THE VARIABLE
ACCOUNTS THAT YOU SHOULD KNOW BEFORE INVESTING. Refer to "The
variable accounts" in this prospectus.
THE PROSPECTUS IS ACCOMPANIED OR PRECEDED BY THE FOLLOWING
PROSPECTUSES: IDS LIFE INVESTMENT SERIES, INC., IDS LIFE MANAGED
FUND, INC., IDS LIFE SPECIAL INCOME FUND, INC. AND IDS LIFE
MONEYSHARE FUND, INC., INVESCO VARIABLE INVESTMENT FUNDS, INC.,
JANUS ASPEN SERIES, TCI PORTFOLIOS INC. AND WARBURG PINCUS TRUST.
PLEASE KEEP THESE PROSPECTUSES FOR FUTURE REFERENCE.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
AMERICAN CENTURION LIFE IS NOT A FINANCIAL INSTITUTION, AND THE
SECURITIES IT OFFERS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY ANY FINANCIAL INSTITUTION NOR ARE THEY
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY.
A Statement of Additional Information (SAI) dated November 18, 1996
(incorporated by reference into this prospectus) has been filed
with the Securities and Exchange Commission (SEC) and available for
reference, along with other related materials, on the SEC Internet
web site (http://www.sec.gov). The SAI is available without charge
by contacting American Centurion Life at the telephone number above
or by completing and sending the order form on the last page of
this prospectus. The table of contents of the SAI is on the last
page of this prospectus.
Participation in the annuity contract will be accounted for
separately by the issuance of an annuity certificate showing your
interest in the contract.
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PAGE 5
Purchase payments may be allocated among different accounts,
providing variable and/or fixed returns. Through the subaccounts
of the variable account, you can invest in mutual funds that are
managed to meet a variety of investment objectives. The
certificate value will vary according to the investment performance
of the funds you select. You bear the entire investment risk under
the annuity.
The annuity offers tax-deferred asset accumulation. This may be
particularly attractive to investors in high federal and state tax
brackets who have made maximum contributions to employer-sponsored
retirement programs and IRAs.
The annuity has no front-end sales charge, nor does it have a
redemption or surrender charge.
The Privileged Assets Select Annuity is designed to allow you to
build up funds for retirement. When you need to access your money,
such as at retirement, you may do so in several ways including the
following: you may take a monthly fixed annuity payout for the
lifetime of the annuitant(s) you have designated, or you may take a
lump-sum or a fixed amount per month on the principal and/or
earnings on the annuity.
<PAGE>
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Contents
Key terms.....................................................
The Privileged Assets (registered trademark symbol) Select
Annuity in brief..............................................
Expense summary...............................................
Financial statements..........................................
Performance information.......................................
The variable account..........................................
The funds.....................................................
IDS Life Aggressive Growth Fund..........................
IDS Life International Equity Fund.......................
IDS Life Capital Resource Fund...........................
IDS Life Managed Fund....................................
IDS Life Special Income Fund.............................
IDS Life Moneyshare Fund.................................
INVESCO VIF-Industrial Income Portfolio..................
Janus Aspen Series Worldwide Growth Portfolio............
Janus Aspen Series Growth Portfolio......................
TCI Growth...............................................
TCI Value................................................
Warburg Pincus Trust-Post-Venture Capital Portfolio......
The fixed account.............................................
Buying your annuity...........................................
Setting the annuity start date...........................
Beneficiary..............................................
Minimum purchase payments................................
Three ways to make purchase payments.....................
Charges.......................................................
Administrative charge....................................
Mortality and expense risk fee...........................
Other information on charges.............................
Valuing your investment.......................................
Number of units..........................................
Accumulation unit value..................................
Net investment factor....................................
Factors that affect variable subaccount
accumulation units....................................
Making the most of your annuity...............................
Automated dollar-cost averaging..........................
Transferring money between accounts......................
Transfer policies........................................
Two ways to request a transfer or a surrender............
Surrendering your annuity.....................................
Surrender policies.......................................
Receiving payment when you request a surrender...........
Changing ownership............................................
Benefits in case of death.....................................
The annuity payout period.....................................
Annuity payout plans.....................................
Death after annuity payouts begin........................
Taxes.........................................................
Voting rights.................................................
Substitution of investments...................................
Distribution of the annuities.................................
About American Centurion Life.................................
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Regular and special reports...................................
Table of contents of the Statement of Additional
Information................................................
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Key terms
These terms can help you understand details about your annuity.
American Centurion Life - In this prospectus, "we," "us," "our" and
"American Centurion Life" refer to American Centurion Life
Assurance Company.
Annuity - A contract or the related certificate you receive that
shows your coverage under the contract, purchased from an insurance
company that offers tax-deferred growth of the investment until
earnings are withdrawn, and that can be tailored to meet the
specific needs of the individual during retirement.
Accumulation unit - A measure of the value of each variable
subaccount before annuity payouts begin.
Annuitant - The person on whose life or life expectancy the payouts
are based.
Annuity payout - An amount paid at regular intervals under one of
several plans available to the owner and/or any other payee. This
amount is paid on a fixed basis.
Annuity start date - The date when annuity payouts are scheduled to
begin. This date is established when you start your annuity. As
your financial goals change, you may change the annuity start date.
Beneficiary - The person designated to receive annuity benefits in
case of the owner's or annuitant's death.
Certificate value - The total purchase payments, plus investment
return, less any administrative charges and prior withdrawals.
Certificate year - A period of 12 months, starting on the effective
date of the certificate and on each anniversary of the effective
date.
Close of business - When the New York Stock Exchange (NYSE) closes,
normally 4 p.m. Eastern time.
Code - Internal Revenue Code of 1986, as amended.
Fixed account - An account to which you may allocate purchase
payments. Amounts allocated to this account earn interest at rates
that are declared periodically by American Centurion Life.
Mutual funds (funds) - Mutual funds or portfolios, each with a
different investment objective. (See "The funds.") You may
allocate your purchase payments into variable subaccounts investing
in shares of any or all of these funds.
Owner (you, your) - The person who controls the annuity (decides on
investment allocation, transfers, payout options, etc.).
Purchase payments - Payments made to American Centurion Life for an
annuity.<PAGE>
PAGE 9
Qualified annuity - An annuity purchased for a retirement plan that
is subject to applicable federal law and any rules of the plan
itself. These plans include:
o Individual Retirement Annuities (IRAs), including rollovers from
qualified plans
o Simplified Employee Pension (SEP) Plans
All other annuities we currently issue are considered nonqualified
annuities.
Surrender value - The amount you are entitled to receive if you
surrender your annuity. It is the certificate value. No surrender
charge will apply.
Valuation date - Any normal business day, Monday through Friday,
that the NYSE is open. The value of each variable subaccount is
calculated at the close of business on each valuation date.
Variable account - An account consisting of separate subaccounts to
which you may allocate purchase payments; each invests in shares of
one mutual fund. (See "The variable account.") The value of your
investment in each variable subaccount changes with the performance
of the particular fund.
The Privileged Assets (registered trademark symbol) Select Annuity
in brief
Purpose: The Privileged Assets (registered trademark symbol)
Select Annuity is designed to allow you to build up funds for
retirement. You do this by making one or more investments
(purchase payments) that may earn returns that increase the value
of the annuity. Beginning at a specified future date (the annuity
start date), the annuity provides lifetime or other forms of
annuity payouts to you or to anyone you designate.
Accounts: You may allocate your purchase payments among any or all
of:
o variable subaccounts, each of which invests in a mutual fund
with a particular investment objective. The value of each
variable subaccount varies with the performance of the
particular fund. Therefore, the certificate value at the
annuity start date may be more or less than the total of
purchase payments allocated to the variable subaccounts.
(p.)
o a fixed account, which earns interest at rates that are
declared periodically by American Centurion Life. The
guaranteed minimum interest rate is 3%. (p.)
Buying the annuity: You can purchase an annuity by submitting a
complete application. Applications are subject to acceptance at
our service office. You may buy a nonqualified annuity or a
qualified annuity. Payment may be made either in a lump sum with
the option of additional payments in the future or installments:
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PAGE 10
o Minimum purchase payment - $2,000 ($1,000 for qualified
certificates) unless you pay in installments by means of a
bank authorization or under a group billing arrangement at a
rate of $100/month or more or other payment plan acceptable
to us.
o Minimum additional payment - $100.
o Maximum first-year payment(s) - $50,000 to $1,000,000
depending on your age.
o Maximum payment for each subsequent year - $50,000. (p.)
Thirty-day free look: You may return your annuity for a full
refund within 30 days after you receive it. The portion of your
first purchase payment allocated to the variable account must be
invested initially in the IDS Life Moneyshare subaccount for the
period we estimate or calculate your free look right to be in
existence (generally 35 days after the annuity issue date.)
If you choose not to keep your annuity, return it to us within the
free look period. The annuity will be canceled and we will refund
promptly the greater of (1) your purchase payment without
investment earnings, or (2) your certificate value plus any amount
deducted from your payment prior to allocation to the variable
account or the fixed account.
Transfers: Subject to certain restrictions you may re-allocate
your money among accounts without charge at any time until annuity
payouts begin. You may establish automated transfers among the
fixed account and variable subaccount(s) and you may request a
transfer by telephone. (p.)
Surrenders: You may surrender all or part of your certificate value
at any time before the annuity start date. You also may establish
systematic surrenders. There is no surrender charge. Earnings on
amounts you surrender may be taxable (and include a 10% penalty if
surrenders are made prior to your reaching age 59 1/2); and have
other tax consequences; also, certain restrictions apply. (p.)
Changing ownership: You may change ownership of a nonqualified
annuity by written instruction. However, such changes of
nonqualified annuities may have federal income tax consequences.
Certain restrictions apply concerning change of ownership of a
qualified annuity. (p.)
Payment in case of death: If you or the annuitant dies before
annuity payouts begin, we will pay the beneficiary the greater of
the certificate value or total purchase payments made less partial
surrenders. (p.)
Annuity payouts: The certificate value of your investment can be
applied to an annuity payout plan that begins on the annuity start
date. You may choose from a variety of plans to make sure that
payouts continue as long as they are needed. If you purchased a
qualified annuity, the payout schedule must meet requirements of
the qualified plan. Payouts will be made on a fixed basis. (p.)
Taxes: Generally, your annuity grows tax-deferred until you
surrender it or begin to receive payouts. (Under certain <PAGE>
PAGE 11
circumstances, IRS penalty taxes may apply.) Even if you direct
payouts to someone else, you will still be taxed on the income if
you are the owner. (p.)
Charges: Your Privileged Assets Select Annuity is subject to a $30
annual administrative charge and a 1% mortality and expense risk
charge against the variable subaccounts. (p.)
Expense summary
The purpose of this summary is to help you understand the various
costs and expenses associated with the annuity.
You pay no sales charge when you purchase the annuity nor do you
pay a surrender charge if you surrender your annuity. All costs
that you bear directly or indirectly for the variable subaccounts
and underlying mutual funds are shown below. Some expenses may
vary as explained under "Charges."
Direct charge. This charge is deducted directly from the
certificate value.
Annual administrative charge: $30. If the total purchase payments
(less partial surrenders) is at least $10,000, we will waive the
charge.
Indirect charges. The variable account pays these expenses out of
its assets. They are reflected in the variable subaccounts' daily
accumulation unit value and are not charged directly to your
account. They include:
Mortality and expense risk fee: 1% per year, deducted from the
variable subaccounts as a percentage of the average daily net
assets of the underlying fund.
Operating expenses of underlying mutual funds: management fees and
other expenses deducted as a percentage of average net assets as
follows:*
<TABLE>
<CAPTION>
IDS Life IDS Life IDS Life IDS Life
Aggressive International Capital IDS Life Special IDS Life
Growth Equity Resource Managed Income Moneyshare
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees .64% .86% .63% .62% .63% .54%
Other expenses .04 .09 .04 .03 .04 .05
Total** .68% .95% .67% .65% .67% .59%
INVESCO VIF Janus Aspen Warburg Pincus
Industrial Series Worldwide Janus Aspen TCI TCI Trust-Post-Venture
Income Growth Series Growth Growth Value Capital
Management fees .75% .68% .65% 1.00% 1.00% .64%
Other expenses .28 .22 .13 -- -- .76
Total 1.03%*** .90%*** .78%*** 1.00%++ 1.00%++ 1.40%+
* Premium taxes imposed by some state and local governments are not reflected in this table.
American Centurion Life has entered into certain agreements under which it is compensated by the funds' advisors and/or
distributors for the administrative services it provides to the funds.
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PAGE 12
** Annualized operating expenses of the underlying mutual funds at Dec. 31, 1995.
*** The figures given above are based on gross expenses before expense offset arrangements, if any, during 1995, for these five
funds. As of the date of this prospectus, certain fees are being waived or expenses are being assumed by the respective investment
managers or service providers for certain of the underlying mutual funds, in each case on a voluntary basis. Without such waivers
or reimbursements, the "Management fees," "Other expenses" and "Total" that would have been incurred for the last completed fiscal
year would be: 1.56%, .28 and 2.13%, respectively, for the INVESCO VIF - Industrial Income Portfolio; .87%, .22 and 1.09%,
respectively, for Janus Aspen Series Worldwide Growth and .85%, .13 and .98%, respectively, for Janus Aspen Series Growth. See the
Portfolios' prospectuses for a discussion of fee waiver and expense reimbursements.
+ This is a new portfolio, operating expenses are based on annualized estimates of such expenses to be incurred in the current
fiscal year. Absent the waiver of fees by the Portfolio's investment adviser and co-administrator, Management Fees for the
Portfolio would equal 1.25%. Other Expenses would equal .81%, and Total Portfolio Operating Expenses would equal 2.06%. The
investment adviser has undertaken to limit the Portfolio's Total Portfolio Operating Expenses to 1.40% through December 31, 1996.
++Operating expenses of the underlying funds at Dec. 31, 1995.
</TABLE>
Example:* You would pay the following expenses on a $1,000
investment, assuming 5% annual return and surrender, no surrender
or selection of an annuity payout plan at the end of each time
period:
<TABLE>
<CAPTION>
IDS Life IDS Life IDS Life IDS Life
Aggressive International Capital IDS Life Special IDS Life
Growth Equity Resource Managed Income Moneyshare
<S> <C> <C> <C> <C> <C> <C> <C>
1 year $ 20.15 $ 22.92 $ 20.05 $ 19.84 $ 20.05 $ 19.23
3 years 62.28 70.64 61.97 61.35 61.97 59.48
5 years 106.95 120.97 106.43 105.39 106.43 102.25
10 years 230.85 259.24 229.79 227.65 229.79 221.22
INVESCO VIF Janus Aspen Warburg Pincus
Industrial Series Worldwide Janus Aspen TCI TCI Trust-Post-Venture
Income Growth Series Growth Growth Value Capital
1 year $ 23.74 $ 22.41 $ 21.18 $ 23.43 $ 23.43 $ 27.53
3 years 73.10 69.09 65.38 72.18 72.18 84.46
5 years 125.09 118.39 112.16 123.55 123.55 143.98
10 years 267.50 254.04 241.45 264.41 264.41 304.89
</TABLE>
This example should not be considered a representation of past or
future expenses. Actual expenses may be more or less than those
shown.
* In this example, the $30 annual administrative charge is
approximated as a .286% charge based on our estimated average
annuity size.
Financial statements
The SAI dated November 18, 1996, contains:
The audited statutory financial statements of American Centurion
Life including:
- balance sheets as of Dec. 31, 1995 and Dec. 31, 1994
- related statements of operations, changes in capital and
surplus and cash flows for the years ended Dec. 31, 1995 and
1994
and the unaudited statutory financial statements for American
Centurion Life including:
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PAGE 13
- balance sheet as of Sept. 30, 1996 and
- related statements of operations, changes in capital and
surplus and cash flows for the 9 months ended Sept. 30, 1996.
Performance information
Performance information for the variable subaccounts may appear
from time to time in advertisements or sales literature. In all
cases, such information reflects the performance of a hypothetical
investment in a particular account during a particular time period.
Calculations are performed as follows:
Simple yield - IDS Life Moneyshare Subaccount: Income over a given
seven-day period (not counting any change in the capital value of
the investment) is annualized (multiplied by 52) by assuming that
the same income is received for 52 weeks. This annual income is
then stated as an annual percentage return on the investment.
Compound yield - IDS Life Moneyshare Subaccount: Calculated like
simple yield, except that, when annualized, the income is assumed
to be reinvested. Compounding of reinvested returns increases the
yield as compared to a simple yield.
Yield - For accounts investing in income funds: Net investment
income (income less expenses) per accumulation unit during a given
30-day period is divided by the value of the unit on the last day
of the period. The result is converted to an annual percentage.
Average annual total return: Expressed as an average annual
compounded rate of return of a hypothetical investment over a
period of one, five and ten years (or up to the life of the
subaccount if it is less than ten years old). This figure reflects
deduction of all applicable charges, including the administrative
charge, and mortality and expense risk fee.
Aggregate total return: Represents the cumulative change in the
value of an investment for a specified period of time (reflecting
change in a subaccount's accumulation unit value). The calculation
assumes reinvestment of investment earnings and reflects the
deduction of all applicable charges, including the administrative
charge and mortality and expense risk fee. Aggregate total return
may be shown by means of schedules, charts or graphs.
Performance information should be considered in light of the
investment objectives and policies, characteristics and quality of
the fund in which the subaccount invests and the market conditions
during the given time period. Such information is not intended to
indicate future performance. Because advertised yields and total
return figures include all charges attributable to the annuity,
which has the effect of decreasing advertised performance,
subaccount performance should not be compared to that of mutual
funds that sell their shares directly to the public. (See the SAI
for a further description of methods used to determine yield and
total return for the subaccounts.)
If you would like additional information about actual performance,
contact American Centurion Life at telephone number on cover page.<PAGE>
PAGE 14
The variable account
Purchase payments can be allocated to any or all of the subaccounts
of the variable account that invest in shares of the following
funds:
Subaccount
IDS Life Aggressive Growth Fund DAG
IDS Life International Equity Fund DIE
IDS Life Capital Resource Fund DCR
IDS Life Managed Fund DMG
IDS Life Special Income Fund DSI
IDS Life Moneyshare Fund DMS
INVESCO VIF - Industrial Income Portfolio DII
Janus Aspen Series Worldwide Growth Portfolio DWG
Janus Aspen Series Growth Portfolio DSG
TCI Growth DGR
TCI Value DVL
Warburg Pincus Trust-Post-Venture Capital Portfolio DVC
The variable account meets the definition of a separate account
under federal securities laws. Income, capital gains and capital
losses of each subaccount are credited or charged to that account
alone. No subaccount will be charged with liabilities of any other
variable account or of our general business. The obligations
arising under the annuities are general obligations of American
Centurion Life.
The variable account was established under New York law and is
registered as a unit investment trust under the Investment Company
Act of 1940 (the 1940 Act). This registration does not involve any
supervision of our management or investment practices and policies
by the SEC.
The funds
IDS Life Aggressive Growth Fund
Objective: capital appreciation. Invests primarily in common stock
of small- and medium-size companies.
IDS Life International Equity Fund
Objective: capital appreciation. Invests primarily in common stock
of foreign issuers and foreign securities convertible into common
stock.
IDS Life Capital Resource Fund
Objective: capital appreciation. Invests primarily in U.S. common
stocks and other securities convertible into common stock,
diversified over many different companies in a variety of
industries.
IDS Life Managed Fund
Objective: maximum total investment return. Invests primarily in
U.S. common stocks, securities convertible into common stock,
warrants, fixed income securities (primarily high-quality corporate
bonds) and money market instruments.
<PAGE>
PAGE 15
IDS Life Special Income Fund
Objective: to provide a high level of current income while
conserving the value of the investment for the longest time period.
Invests primarily in high-quality, lower-risk corporate bonds
issued by many different companies in a variety of industries, and
in government bonds.
IDS Life Moneyshare Fund
Objective: maximum current income consistent with liquidity and
conservation of capital. Invests in high-quality money market
securities with remaining maturities of 13 months or less. The
fund also will maintain a dollar-weighted average portfolio
maturity not exceeding 90 days. The fund attempts to maintain a
constant net asset value of $1 per share.
INVESCO VIF - Industrial Income Portfolio
Objective: to seek the best possible current income while following
sound investment practices with capital growth potential as a
secondary consideration. Invests primarily in income-producing
common stocks, as well as other income-producing securities such as
corporate bonds.
Janus Aspen Series Worldwide Growth Portfolio
Objective: long-term growth of capital in a manner consistent with
the preservation of capital. Invests primarily in common stocks of
foreign and domestic issuers.
Janus Aspen Series Growth Portfolio
Objective: long-term growth of capital in a manner consistent with
the preservation of capital. Invests primarily in common stocks,
with an emphasis on companies with larger market capitalizations.
TCI Growth
Objective: capital growth. Invests primarily in common stocks that
are considered by management to have better-than-average prospects
for appreciation.
TCI Value
Objective: long-term capital growth, with income as a secondary
objective. Invests primarily in securities that management
believes to be undervalued at the time of purchase.
Warburg Pincus Trust-Post-Venture Capital Portfolio
Objective: long-term growth of capital. Invests primarily in
equity securities of issuers in their post-venture capital stage of
development.
All funds are available to serve as the underlying investment for
variable annuities, and some funds are available to serve as the
underlying investment for variable annuities and variable life
insurance contracts and qualified plans. It is conceivable that in
the future it may be disadvantageous for variable annuity separate
accounts, variable life insurance separate accounts and/or
qualified plans to invest in the available funds simultaneously.
Although American Centurion Life and the funds do not currently
foresee any such disadvantages, the boards of directors or trustees
of the appropriate funds will monitor events in order to identify
<PAGE>
PAGE 16
any material conflicts between such certificate owners and policy
owners and qualified plans to determine what action, if any, should
be taken in response to a conflict. If a board were to conclude
that separate funds should be established for variable life
insurance, variable annuity and qualified separate accounts, the
variable annuity certificate holders would not bear any expenses
associated with establishing separate funds.
The Internal Revenue Service (IRS) has issued final regulations
relating to the diversification requirements under Section 817(h)
of the Code. Each mutual fund intends to comply with these
requirements.
The U.S. Treasury and the IRS have indicated they may provide
additional guidance concerning how many variable subaccounts may be
offered and how many exchanges among variable subaccounts may be
allowed before the owner is considered to have investment control,
and thus is currently taxed on income earned within variable
subaccount assets. We do not know at this time what the additional
guidance will be or when action will be taken. We reserve the
right to modify the annuity, as necessary, to ensure that the owner
will not be subject to current taxation as the owner of the
variable subaccount assets.
We intend to comply with all federal tax laws to ensure that the
annuity continues to qualify as an annuity for federal income tax
purposes. To the extent permitted under applicable law, we reserve
the right to modify the contract as necessary to comply with any
new tax laws.
IDS Life is the investment manager and American Express Financial
Corporation is the investment advisor for each of the IDS Life
Funds. INVESCO Funds Group, Inc. is the investment advisor and
INVESCO Trust Company is the sub-adviser for the INVESCO VIF -
Industrial Income Portfolio. Janus Capital Corporation is the
investment manager for Janus Aspen Series Worldwide Growth
Portfolio and Janus Aspen Series Growth Portfolio. Investors
Research Corporation serves as the investment manager of TCI
Portfolios, Inc. Warburg, Pincus Counsellors, Inc. is the
investment adviser of Warburg Pincus Trust-Post-Venture Capital
Portfolio. The investment managers for the funds cannot guarantee
that the funds will meet their investment objectives. Please read
the prospectuses for the funds for complete information on
investment risks, deductions, expenses and other facts you should
know before investing. They are available by contacting American
Centurion Life at the address or telephone number on the front of
this prospectus.
The fixed account
Purchase payments can also be allocated to the fixed account. The
cash value of the fixed account increases as interest is credited
to the account. Purchase payments and transfers to the fixed
account become part of the general account of American Centurion
Life, the company's main portfolio of investments. Interest is <PAGE>
PAGE 17
credited daily and compounded annually. We guarantee a minimum
interest rate of 3%. We may declare interest rates above the
guaranteed rate from time to time.
Because of exemptive and exclusionary provisions, interests in the
fixed account have not been registered under the Securities Act of
1933 (1933 Act), nor is the fixed account registered as an
investment company under the 1940 Act. Accordingly, neither the
fixed account nor any interests in it are generally subject to the
provisions of the 1933 or 1940 Acts, and we have been advised that
the staff of the SEC has not reviewed the disclosures in this
prospectus that relate to the fixed account. Disclosures regarding
the fixed account, however, may be subject to certain generally
applicable provisions of the federal securities laws relating to
the accuracy and completeness of statements made in prospectuses.
Buying the annuity
Our representative can help you prepare and submit your
application. Alternatively, you may ask us for the forms and
prepare them yourself. As an owner, you have all rights and may
receive all benefits under the annuity. The annuity can be owned
in joint tenancy only in spousal situations (but not IRAs or SEPs).
When you apply, you can select:
o the account(s) in which you want to invest;
o how you want to make purchase payments;
o the date you want to start receiving annuity payouts (the
annuity start date); and
o a beneficiary.
If your application is complete, we will process it and apply your
purchase payment to your account(s) within two days after we
receive it. If your application is accepted, we will send you an
annuity. If we cannot accept your application within five days, we
will decline it and return your payment. We will credit additional
purchase payments you make to an existing annuity to your
account(s) at the next close of business.
Setting the annuity start date
Annuity payouts will be scheduled to begin on the annuity start
date. This date can be aligned with your actual retirement from a
job, or it can be a different future date, depending on your needs
and goals and on certain restrictions. You can also change the
date, provided you send us written instructions at least 30 days
before annuity payouts begin.
For nonqualified annuities, the annuity start date must be:
o no earlier than the 60th day after the annuity's effective
date; and
o no later than the annuitant's 85th birthday.
For qualified annuities, to avoid IRS penalty taxes, the annuity
start date generally must be:
<PAGE>
PAGE 18
o on or after the annuitant reaches age 59 1/2; and
o by April 1 of the year following the calendar year when the
annuitant reaches age 70 1/2.
If you are taking the minimum IRA distributions as required by the
Code from another tax-qualified investment, or in the form of
partial surrenders from this annuity, annuity payouts can start as
late as, but not later than, the annuitant's 85th birthday.
Beneficiary
If death benefits become payable before the annuity start date,
your named beneficiary will receive all or part of the certificate
value. If there is no named beneficiary, then you or your estate
will be the beneficiary. (See "Benefits in case of death" for more
about beneficiaries.)
Minimum purchase payments
If single payment:
Nonqualified: $2,000
Qualified: $1,000
If installment payments:
$100 monthly; $50.00 biweekly
Installments must total at least $1,000 in the first year.*
*If you make no purchase payments for the most recent 36 months,
and your previous payments total $1,000 or less, we have the right
to give you 30 days' written notice and pay you the total value of
your annuity in a lump sum.
Minimum additional purchase payment(s): $100
Maximum first-year payment(s):
This maximum is based on your age or age of the annuitant (whomever
is older) on the effective date of the annuity.
Up to age 75 $1 million
76 to 85 $500,000
Maximum payment for each subsequent year: $50,000**
**These limits apply in total to all American Centurion Life
annuities you own. We reserve the right to increase maximum
limits or reduce age limits. For qualified annuities the qualified
plan's or the Code's limits on annual contributions also apply.
Three ways to make purchase payments
1 By letter
Send your check along with your name and account number to:
<PAGE>
PAGE 19
Regular mail:
American Centurion Life Assurance Company
Box 5144
Albany, NY 12205
Express mail:
American Centurion Life Assurance Company
20 Madison Avenue Ext.
Albany, NY 12203
2 By scheduled payment plan
Through:
o a bank authorization.
3 Other
o wire transfer; or
o other method acceptable to us.
Charges
Administrative charge
This charge is for establishing and maintaining your records. On
each annuity anniversary we will deduct $30 from the certificate
value. The deduction will be allocated among the subaccounts on a
pro-rata basis.
This charge will be waived for any certificate year where the total
purchase payments (less partial surrenders) on the current annuity
anniversary is $10,000 or more, or if, during the certificate year,
a death benefit is payable or the annuity is surrendered in full.
This charge does not apply after annuity payouts begin.
We do not expect to profit from the administrative charge. We
reserve the right to impose the charge on all annuities, including
those with purchase payments equal to or greater than $10,000.
Mortality and expense risk fee
This fee is to cover the mortality risk and expense risk and is
applied daily to the variable subaccounts and reflected in the unit
values of the accounts. Annually it totals 1% of their average
daily net assets. Approximately two-thirds of this amount is for
our assumption of mortality risk, and one-third is for our
assumption of expense risk. This fee does not apply to the fixed
account.
Mortality risk arises because of our guarantee to pay a death
benefit and our guarantee to make annuity payouts according to the
terms of the contract and certificates, no matter how long a
specific annuitant lives and no matter how long the entire group of
American Centurion Life annuitants live. If, as a group, American
Centurion Life annuitants outlive the life expectancy we have <PAGE>
PAGE 20
assumed in our actuarial tables, then we must take money from our
general assets to meet our obligations. If, as a group, American
Centurion Life annuitants do not live as long as expected, we could
profit from the mortality risk fee.
Expense risk arises because the administrative charge may not cover
our expenses. Any deficit would have to be made up from our
general assets. We could profit from the expense risk fee if the
annual administrative charge is more than sufficient to meet
expenses.
We do hope to profit from the mortality and expense risk fee. We
may use any profits realized from this fee for any proper corporate
purpose, including, among others, payment of distribution (selling)
expenses.
Other information on charges
There is no surrender charge if you take a total or a partial
surrender from your annuity.
In some cases lower sales and administrative expenses may be
incurred. In such cases, we may be able to reduce or eliminate the
administrative charge. However, we expect this to occur
infrequently.
Valuing your investment
Here is how your accounts are valued:
Fixed account: The amounts allocated to the fixed account are
valued directly in dollars and equal the sum of your purchase
payments plus interest earned, less any amounts surrendered or
transferred.
Variable subaccounts: Amounts allocated to the variable
subaccounts are converted into accumulation units. Each time you
make a purchase payment or transfer amounts into one of the
variable subaccounts, a certain number of accumulation units are
credited to your annuity for that account. Conversely, each time
you take a partial surrender, transfer amounts out of a variable
subaccount or are assessed an administrative charge, a certain
number of accumulation units are subtracted from your annuity.
The accumulation units are the true measure of investment value in
each subaccount during the accumulation period. They are related
to, but not the same as, the net asset value of the underlying
fund.
The dollar value of each accumulation unit can rise or fall daily
depending on the performance of the underlying mutual fund and on
certain fund expenses. Here is how unit values are calculated:
Number of units
To calculate the number of accumulation units for a particular
subaccount, we divide your investment by the current accumulation
unit value.
<PAGE>
PAGE 21
Accumulation unit value
The current accumulation unit value for each variable subaccount
equals the last value times the subaccount's current net investment
factor.
Net investment factor
o Determined each business day by adding the underlying mutual
fund's current net asset value per share plus per-share
amount of any current dividend or capital gain distribution;
then
o dividing that sum by the previous net asset value per share;
and
o subtracting the percentage factor representing the mortality
and expense risk fee from the result.
Because the net asset value of the underlying mutual fund may
fluctuate, the accumulation unit value may increase or decrease.
You bear this investment risk in a variable subaccount.
Factors that affect variable subaccount accumulation units
Accumulation units may change in two ways; in number and in value.
Here are the factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
o additional purchase payments allocated to the variable
subaccounts;
o transfers into or out of the variable subaccount(s);
o partial surrenders; and/or
o administrative charges.
Accumulation unit values may fluctuate due to:
o changes in underlying mutual fund(s) net asset value;
o dividends distributed to the variable subaccount(s);
o capital gains or losses of underlying mutual funds;
o mutual fund operating expenses; and/or
o mortality and expense risk fees.
Making the most of your annuity
Automated dollar-cost averaging
You can use automated transfers to take advantage of dollar-cost
averaging (investing a fixed amount at regular intervals). For
example, you might have a set amount transferred monthly from a
relatively conservative variable subaccount to a more aggressive
one, or to several others.
This systematic approach can help you benefit from fluctuations in
accumulation unit values caused by fluctuations in the market
value(s) of the underlying mutual fund(s). Since you invest the
same amount each period, you automatically acquire more units when
the market value falls, fewer units when it rises. The potential
effect is to lower your average cost per unit. Contact our service
office for more information.
<PAGE>
PAGE 22
<TABLE>
<CAPTION>
How dollar-cost averaging works
Month Amount Accumulation Number of units
invested unit value purchased
<S> <C> <C> <C> <C>
By investing an Jan $100 $20 5.00
equal number of
dollars each month.... Feb 100 16 6.25
March 100 9 11.11
you automatically April 100 5 20.00
buy more units
when the per unit May 100 7 14.29
market price is low....
June 100 10 10.00
July 100 15 6.67
and fewer units Aug 100 20 5.00
when the per unit
market price is Sept 100 17 5.88
high.
Oct 100 12 8.33
</TABLE>
You have paid an average price of only $10.81 per unit over the 10
months, while the average market price actually was $13.10.
Dollar-cost averaging does not guarantee that any subaccount will
gain in value, nor will it protect against a decline in value if
market prices fall. However, if you can continue to invest
regularly throughout changing market conditions, it can be an
effective strategy to help meet your long term goals.
Transferring money between accounts
You may transfer money from any one subaccount or the fixed account
to another at any time before annuity payouts begin. If we receive
your request before the close of business, we will process it that
day. Requests received after the close of business will be
processed the next business day. Before making a transfer, you
should consider the risks involved in switching investments. We
may suspend or modify transfer privileges at any time.
Transfer policies
o You may transfer certificate values at any time between the
variable subaccounts, from the variable subaccount(s) to the
fixed account or from the fixed account to the variable
subaccount(s).
o The amount being transferred to any one account must be at
least $100.
o If you make more than 12 transfers in a certificate year, we
will charge $25 for each transfer in excess of 12.
o Excessive trading activity can disrupt mutual fund management
strategy and increase expenses, which are borne by all
annuity owners participating in the mutual fund regardless of
their transfer activity. Therefore, we reserve the right to
limit the number of transfers permitted, but not to fewer
than twelve per certificate year.
<PAGE>
PAGE 23
Two ways to request a transfer or a surrender
1 By letter
Send your name, contract number, Social Security Number or Taxpayer
Identification Number and signed request for a transfer or
surrender to:
Regular mail:
American Centurion Life Assurance Company
Box 5144
Albany, NY 12205
Express mail:
American Centurion Life Assurance Company
20 Madison Avenue Ext.
Albany, NY 12203
Minimum amount
Mail transfers: $100 or entire account balance
Mail surrenders: $100 or entire account balance
Maximum amount
Mail transfers: None (up to certificate value)
Mail surrenders: None (up to certificate value)
2 By automated transfers and automated partial surrenders
o You can set up automated transfers among your accounts or
partial surrenders from the accounts.
You can start or stop this service by written request or other
method acceptable to American Centurion Life. You must allow 30
days for American Centurion Life to change any instructions that
are currently in place.
o Automated transfers and automated partial surrenders are
subject to all of the annuity provisions and terms, including
transfer of certificate values between accounts. Automated
surrenders may be restricted by applicable law under some
annuities.
o Automated partial surrenders may result in IRS taxes and
penalties on all or part of the amount surrendered.
Minimum amount
Automated transfers or surrenders: $100
Maximum amount
Automated transfers or surrenders: None
Surrendering your annuity
As owner, you may surrender all or part of your annuity at any time
before annuity payouts begin by sending a written request to
American Centurion Life. For total surrenders we will compute the
certificate value at the close of business after we receive your <PAGE>
PAGE 24
request. We may ask you to return the annuity. You may have to
pay IRS taxes and penalties. (See "Taxes.") No surrenders may be
made after annuity payouts begin.
Surrender policies
If you have a balance in more than one account and request a
partial surrender, we will surrender money from all your accounts
in the same proportion as your value in each account correlates to
your total certificate value, unless you request otherwise.
Receiving payment when you request a surrender
By regular or express mail:
o Payable to owner.
o Normally mailed to address of record within seven days after
receiving your request. However, we may postpone the payment
if:
-the surrender amount includes a purchase payment check that
has not cleared;
-the NYSE is closed, except for normal holiday and weekend
closings;
-trading on the NYSE is restricted, according to SEC rules;
-an emergency, as defined by SEC rules, makes it impractical
to sell securities or value the net assets of the accounts;
or
-the SEC permits us to delay payment for the protection of
security holders.
Changing ownership
You may change ownership of your non-qualified annuity at any time
by filing a change of ownership with us at our service office. The
change will become binding upon us when we receive and record it.
We will honor any change of ownership request believed to be
authentic and will use reasonable procedures to confirm that it is.
If these procedures are followed, we take no responsibility for the
validity of the change.
If you have a nonqualified annuity, you may lose your tax
advantages by transferring, assigning or pledging any part of it.
(See "Taxes.")
If you have a qualified annuity, you may not sell, assign,
transfer, discount or pledge your annuity as collateral for a loan,
or as security for the performance of an obligation or for any
other purpose to any person except American Centurion Life.
However, if the owner is a trust or custodian, or an employer
acting in a similar capacity, ownership of an annuity may be
transferred to the annuitant.
Benefits in case of death
If you or the annuitant dies (or, for qualified annuities, if the
annuitant dies) before annuity payouts begin, we will pay the
beneficiary the greater of:<PAGE>
PAGE 25
o the annuity value; or
o purchase payments, minus any partial surrenders.
If your spouse is sole beneficiary under a non-qualified annuity
and you die before the annuity start date, your spouse may keep the
annuity as owner. To do this your spouse must, within 60 days
after we receive proof of death, give us written instructions to
keep the annuity in force.
Under a qualified annuity if the annuitant dies before reaching age
70 1/2 and before the annuity start date, and the spouse is the
only beneficiary, the spouse may keep the annuity in force as owner
or until the date on which the annuitant would have reached age 70
1/2 or any other date permitted by the Code. To do this, the
spouse must give us written instructions within 60 days after we
receive proof of death.
Payouts: We will pay the beneficiary in a single sum unless you
have given us other written instructions, or the beneficiary may
receive payouts under any annuity payout plan available under this
annuity if:
o the beneficiary asks us in writing within 60 days after we
receive proof of death;
o payouts begin no later than one year after death; and
o the payout period does not extend beyond the beneficiary's
life or life expectancy.
When paying the beneficiary, we will determine the certificate's
value at the next close of business after our death claim
requirements are fulfilled. Interest, if any, will be paid from
the date of death at a rate no less than required by law. We will
mail payment to the beneficiary within seven days after our death
claim requirements are fulfilled. (See "Taxes.")
The annuity payout period
As owner, you have the right to decide how and to whom annuity
payouts will be made starting at the annuity start date. You may
select one of the annuity payout plans outlined below, or we will
mutually agree on other payout arrangements. The amount available
for payouts under the plan you select is the certificate value on
your annuity start date. Annuity payouts will be made on a fixed
basis.
Amounts of payouts depend on:
o the annuity payout plan you select;
o the annuitant's age and, in most cases, sex; and
o the annuity table in the annuity.
Annuity payout plans
You may choose any one of these annuity payout plans by giving us
written instructions at least 30 days before certificate values are
to be used to purchase the payout plan:
<PAGE>
PAGE 26
o Plan A - Life annuity - no refund: Monthly payouts are made
until the annuitant's death. Payouts end with the last payout
before the annuitant's death; no further payouts will be made.
This means that if the annuitant dies after only one monthly payout
has been made, no more payouts will be made.
o Plan B - Life annuity with five, 10 or 15 years certain: Monthly
payouts are made for a guaranteed payout period of five, 10 or 15
years that the annuitant elects. This election will determine the
length of the payout period to the beneficiary if the annuitant
should die before the elected period has expired. The guaranteed
payout period is calculated from the annuity start date. If the
annuitant outlives the elected guaranteed payout period, payouts
will continue until the annuitant's death.
o Plan C - Life annuity - installment refund: Monthly payouts are
made until the annuitant's death, with our guarantee that payouts
will continue for some period of time. Payouts will be made for at
least the number of months determined by dividing the amount
applied under this option by the first monthly payout, whether or
not the annuitant is living.
o Plan D - Joint and last survivor life annuity - no refund:
Monthly payouts are made to the annuitant and a joint annuitant
while both are living. If either annuitant dies, monthly payouts
continue at the full amount until the death of the surviving
annuitant. Payouts end with the death of the second annuitant.
o Plan E - Payouts for a specified period: Monthly payouts are
made for a specific payout period of 10 to 30 years chosen by the
annuitant. Payouts will be made only for the number of years
specified whether the annuitant is living or not. Depending on the
time period selected, it is foreseeable that an annuitant can
outlive the payout period selected. In addition, a 10% IRS penalty
tax could apply under this payout plan. (See "Taxes.")
Restrictions for some qualified plans: If you purchased a
qualified annuity, you must select a payout plan that provides for
payouts:
o over the life of the annuitant;
o over the joint lives of the annuitant and a designated
beneficiary;
o for a period not exceeding the life expectancy of the
annuitant; or
o for a period not exceeding the joint life expectancies of the
annuitant and a designated beneficiary.
If we do not receive instructions: You must give us written
instructions for the annuity payouts at least 30 days before the
annuitant's annuity start date. If you do not, we will make
payouts under Plan B, with 120 monthly payouts guaranteed.
<PAGE>
PAGE 27
If monthly payouts would be less than $20: We will calculate the
amount of monthly payouts at the time the certificate value is used
to purchase a payout plan. If the calculations show that monthly
payouts would be less than $20, we have the right to pay the
certificate value to you in a lump sum.
Death after annuity payouts begin
If you or the annuitant dies after annuity payouts begin, any
amount payable to the beneficiary will be provided in the annuity
payout plan in effect.
Taxes
Generally, under current law, any increase in your certificate
value is taxable to you only when you receive a payout or
surrender. (However, see detailed discussion below.) Any portion
of the annuity payouts and any surrenders you request that
represent ordinary income are normally taxable. You will receive a
1099 tax information form for any year in which a taxable
distribution was made.
Annuity payouts under nonqualified annuities: A portion of each
payout will be ordinary income and subject to tax, and a portion of
each payout will be considered a return of part of your investment
and will not be taxed. All amounts received after your investment
in the annuity is fully recovered will be subject to tax.
Tax law requires that all nonqualified deferred annuities issued by
the same company to the same owner during a calendar year are to be
taxed as a single, unified annuity when distributions are taken
from any one of such annuities.
Annuity payouts under qualified annuities: Under a qualified
annuity, the entire payout generally will be includable as ordinary
income and subject to tax except to the extent that contributions
were made with after-tax dollars. If you invested in your annuity
with pre-tax dollars as part of a qualified retirement plan, such
amounts are not considered to be part of your investment in the
annuity and will be taxed when paid to you.
Surrenders: If you surrender part or all of your annuity before
your annuity payouts begin, your surrender payment will be taxed to
the extent that the value of your annuity immediately before the
surrender exceeds your investment. You also may have to pay a 10%
IRS penalty for surrenders before reaching age 59 1/2. For
qualified annuities, other penalties may apply if you surrender
your annuity before your plan specifies that you can receive
payouts.
Death benefits to beneficiaries: The death benefit under an
annuity is not tax-exempt. Any amount received by the beneficiary
that represents previously deferred earnings within the annuity is
taxable as ordinary income to the beneficiary in the year(s) he or
she receives the payments.
<PAGE>
PAGE 28
Annuities owned by corporations, partnerships or trusts: Any
annual increase in the value of annuities held by such entities
generally will be treated as ordinary income received during that
year. This provision is effective for purchase payments made after
Feb. 28, 1986. However, if the trust was set up for the benefit of
a natural person only, the increase in value will be tax-deferred.
Penalties: If you receive amounts from your annuity before
reaching age 59 1/2, you may have to pay a 10% IRS penalty on the
amount includable in your ordinary income. However, this penalty
will not apply to any amount received by you or your beneficiary:
o because of your death;
o because you become disabled (as defined in the Code);
o if the distribution is part of a series of substantially
equal periodic payments, made at least annually, over your
life or life expectancy (or joint lives or life expectancies
of you and your beneficiary); or
o if it is allocable to an investment before Aug. 14, 1982
(except for qualified annuities).
For a qualified annuity, other penalties or exceptions may apply if
you surrender your annuity before your plan specifies that payouts
can be made.
Withholding, generally: If you receive all or part of the
certificate value from an annuity, withholding may be imposed
against the taxable income portion of the payment. Any withholding
that is done represents a prepayment of your tax due for the year.
You take credit for such amounts on the annual tax return that you
file.
If the payment is part of an annuity payout plan, the amount of
withholding generally is computed using payroll tables. You can
provide us with a statement of how many exemptions to use in
calculating the withholding. As long as you've provided us with a
valid Social Security Number or Taxpayer Identification Number, you
can elect not to have any withholding occur.
If the distribution is any other type of payment (such as a partial
or total surrender) withholding is computed using 10% of the
taxable portion. Similar to above, as long as you've provided us
with a valid Social Security Number or Taxpayer Identification
Number, you can elect not to have this withholding occur.
Some states also impose withholding requirements similar to the
federal withholding described above. If this should be the case,
any payment from which federal withholding is deducted may also
have state withholding deducted. The withholding requirements may
differ if payment is being made to a non-U.S. citizen or if the
payment is being delivered outside the United States.
Transfer of ownership of a nonqualified annuity: If you make such
a transfer without receiving adequate consideration, the transfer
is considered a gift, and also may be considered a surrender for
federal income tax purposes. If the gift is a currently taxable
<PAGE>
PAGE 29
event, the amount of deferred earnings at the time of the transfer
will be taxed to the original owner, who also may be subject to a
10% IRS penalty as discussed earlier. In this case, the new
owner's investment in the annuity will be the certificate value of
at the time of the transfer.
Collateral assignment of a nonqualified certificate: If you
collaterally assign or pledge your annuity, earnings on purchase
payments you made after Aug. 13, 1982 will be taxed to you like a
surrender.
Important: Our discussion of federal tax laws is based upon our
understanding of these laws as they are currently interpreted.
Federal tax laws or current interpretations of them may change.
For this reason and because tax consequences are complex and highly
individual and cannot always be anticipated, you should consult a
tax adviser if you have any questions about taxation of your
annuity.
Tax Qualification
This annuity is intended to qualify for federal income tax purposes
as an annuity. To the extent permitted by applicable law, we will
administer the provisions to be consistent with such qualification.
We reserve the right to amend the annuity to reflect any
clarifications that may be needed or are appropriate to maintain
such qualification or to conform the annuity to any applicable
changes in the tax qualification requirements. We will obtain any
necessary regulatory approvals and send you a copy of any such
amendments.
Voting rights
As an owner with investments in the variable account(s), you may
vote on important mutual fund policies. We will vote fund shares
according to your instructions.
The number of votes you have is determined by applying your
percentage interest in each variable subaccount to the total number
of votes allowed to the subaccount.
We calculate votes separately for each subaccount not more than 60
days before a shareholders' meeting. Notice of these meetings,
proxy materials and a statement of the number of votes to which the
voter is entitled, will be sent.
We will vote shares for which we have not received instructions in
the same proportion as the votes for which we have received
instructions. We also will vote the shares for which we have
voting rights in the same proportion as the votes for which we have
received instructions.
Substitution of investments
If shares of any fund should not be available for purchase by the
appropriate variable subaccount or if, in the judgment of American
Centurion Life's Management, further investment in such shares is
no longer appropriate in view of the purposes of the subaccount, <PAGE>
PAGE 30
investment in the subaccount may be discontinued or another
registered open-end management investment company may be
substituted for fund shares held in the subaccounts if American
Centurion Life believes it would be in the best interest of persons
having voting rights under the annuity. The variable account may
be operated as a management company under the 1940 Act or it may be
deregistered under this Act if the registration is no longer
required. In the event of any such substitution or change,
American Centurion Life, without the consent or approval of the
owners, may amend the annuity and take whatever action is necessary
and appropriate. However, no such substitution or change will be
made without the necessary approval of the SEC and state insurance
departments. American Centurion Life will notify owners of any
substitution or change.
Distribution of the Annuities
The annuities will be distributed by American Express Service
Corporation, the principal underwriter for the variable account.
About American Centurion Life
The Privileged Assets Select Annuity is issued by American
Centurion Life. American Centurion Life is a wholly owned
subsidiary of IDS Life Insurance Company, which is a wholly owned
subsidiary of American Express Financial Corporation. American
Express Financial Corporation is a wholly owned subsidiary of the
American Express Company. American Express Company is a financial
services company principally engaged through subsidiaries (in
addition to American Express Financial Corporation) in travel
related services, investment services and international banking
services.
American Centurion Life is a stock life insurance company organized
in 1969 under the laws of the State of New York. Its service
office is located at 20 Madison Avenue Ext. Albany, NY 12203.
American Centurion Life is licensed in the state of New York where
it conducts a conventional life insurance business.
American Express Service Corporation is the principal underwriter
for the variable account. Its service office is located at 80
South 8th Street, Minneapolis, MN 55440-0010. American Express
Service Corporation is registered with the SEC under the Securities
Exchange Act of 1934 as a broker-dealer and is a member of the
National Association of Securities Dealers, Inc. American Express
Service Corporation is a wholly owned subsidiary of American
Express Travel Related Services Company which is a wholly owned
subsidiary of American Express Company.
The American Express Financial Corporation family of companies also
offers mutual funds, investment certificates and a broad range of
financial management services.
Other subsidiaries provide investment management and related
services for pension, profit-sharing, employee savings and
endowment funds of businesses and institutions.
<PAGE>
PAGE 31
Regular and special reports
Services
To help you track and evaluate the performance of your annuity,
American Centurion Life provides:
Quarterly statements showing the value of your investment.
Annual reports containing required information on the certificate
and its underlying investments.
Table of contents of the Statement of Additional Information
Performance information............................
Calculating annuity payouts........................
Rating Agencies....................................
Principal underwriter..............................
Independent auditors...............................
Retirement planning................................
Prospectus.........................................
Financial statements -
American Centurion Life Assurance Company....
___________________________________________________________________
Please check the appropriate box to receive a copy of the Statement
of Additional Information for:
_____ Privileged Assets Select Annuity
_____ IDS Life Retirement Annuity Mutual Funds
_____ INVESCO Variable Investment Funds, Inc.
_____ Janus Variable Investment Funds
_____ TCI Portfolios, Inc.
_____ Warburg Pincus Trust-Post-Venture Capital Portfolio
Please return this request to:
American Centurion Life Assurance Company
20 Madison Avenue Ext.
Albany, NY 12203
Your name _______________________________________________________
Address _________________________________________________________
City ______________________ State ______________ Zip ___________
<PAGE>
PAGE 32
STATEMENT OF ADDITIONAL INFORMATION
for
PRIVILEGED ASSETS (registered trademark symbol) SELECT ANNUITY
ACL VARIABLE ANNUITY ACCOUNT 1
November 18, 1996
ACL Variable Annuity Account 1 is a separate account established
and maintained by American Centurion Life Assurance Company
(American Centurion Life).
This Statement of Additional Information, dated November 18, 1996,
is not a prospectus. It should be read together with the Account's
prospectus, dated November 18, 1996, which may be obtained by
writing or calling American Centurion Life at the address or
telephone number below.
American Centurion Life Assurance Company
20 Madison Avenue Ext.
Albany, NY 12203
Phone (518) 452-4150
<PAGE>
PAGE 33
TABLE OF CONTENTS
Performance Information.......................................p. 3
Calculating Annuity Payouts...................................p. 5
Rating Agencies...............................................p. 5
Principal Underwriter.........................................p. 6
Independent Auditors..........................................p. 6
Retirement Planning...........................................p. 6
Prospectus....................................................p. 6
Financial Statements
- American Centurion Life Assurance Company.........p. 7
<PAGE>
PAGE 34
PERFORMANCE INFORMATION
The following performance figures are calculated on the basis of
historical performance of the funds. Before the subaccounts began
investing in these funds, the figures show what the subaccount
performance would have been if these subaccounts had existed during
the illustrated periods. Once these subaccounts began investing in
these funds, actual values are used for the calculations.
Calculation of yield for IDS Life Moneyshare Subaccount
Simple yield for the IDS Life Moneyshare subaccount (DMS) will be
based on the: (a) change in the value of a hypothetical investment
(exclusive of capital changes) at the beginning of a seven-day
period for which yield is to be quoted; (b) subtracting a pro rata
share of subaccount expenses accrued over the seven-day period; (c)
dividing the difference by the value of the subaccount at the
beginning of the period to obtain the base period return; and (d)
annualizing the results (i.e., multiplying the base period return
by 365/7). Calculation of compound yield begins with the same base
period return used in the calculation of yield, which is then
annualized to reflect compounding according to the following
formula:
Compound Yield = [(return for seven-day period + 1) 365/7 ]-1
On Sept. 30, 1996, the account's annualized yield was 3.57% and its
compound yield was 3.63%.
The rate of return, or yield, on the subaccount's accumulation unit
may fluctuate daily and does not provide a basis for determining
future yields. Investors must consider, when comparing an
investment in subaccount DMS with fixed annuities, that fixed
annuities often provide an agreed-to or guaranteed fixed yield for
a stated period of time, whereas the variable subaccount's yield
fluctuates. In comparing the yield of subaccount DMS to a money
market fund, you should consider the different services that the
annuity provides.
Calculation of yield for Subaccounts (Investing in income funds)
Quotations of yield will be based on all investment income earned
during a particular 30-day period, less expenses accrued during the
period (net investment income) and will be computed by dividing net
investment income per accumulation unit by the value of an
accumulation unit on the last day of the period, according to the
following formula:
YIELD = 2[(a-b + 1)6 - 1]
cd
where: a = dividends and investment income earned during the
period.
b = expenses accrued for the period (net of
reimbursements).
<PAGE>
PAGE 35
c = the average daily number of accumulation units
outstanding during the period that were entitled to
receive dividends.
d = the maximum offering price per accumulation unit on
the last day of the period.
Yield on the subaccount is earned from the increase in the net
asset value of shares of the fund in which the subaccount invests
and from dividends declared and paid by the fund, which are
automatically invested in shares of the fund.
Calculation of average annual total return
Quotations of average annual total return for a subaccount will be
expressed in terms of the average annual compounded rate of return
of a hypothetical investment in the annuity contract over a period
of one, five and 10 years (or, if less, up to the life of the
subaccount), calculated according to the following formula:
P(1+T)n = ERV
where: P = a hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five,
or ten year (or other) period at the end of the
one, five, or ten year (or other) period (or
fractional portion thereof).
The Securities and Exchange Commission requires that an assumption
be made that the owner surrenders the entire annuity at the end of
the one, five and ten year periods (or, if less, up to the life of
the subaccount) for which performance is required to be calculated.
Average Annual Total Return Period Ended: Dec. 31, 1995
<TABLE>
<CAPTION>
Average Annual Total Return with or without Surrender
Since
Subaccount investing in: 1 Year 5 Years 10 Years Inception
<S> <C> <C> <C> <C>
IDS LIFE
Aggressive Growth Fund (1/92)* 30.47% -- % -- % 9.94%
Capital Resource Fund (10/81) 26.57 14.08 12.42 --
International Equity Fund (1/92) 10.04 -- -- 8.24
Managed Fund (4/86) 22.92 11.89 -- 9.98
Moneyshare Fund (10/81) 4.16 2.91 4.54 --
Special Income Fund (10/81) 21.01 10.55 8.89 --
INVESCO VIF
Industrial Income Portfolio (8/94) 27.96 -- -- 19.60
Janus Aspen Series
Worldwide Growth Portfolio (9/93) 26.08 -- -- 19.45
Growth Portfolio (9/93) 28.88 -- -- 13.96
TCI
Growth (11/87) 29.81 13.60 -- 11.56
Warburg Pincus Trust
Post-Venture Capital Portfolio (9/95)** -- -- -- 5.61
* inception dates of the funds are shown in parentheses.
** annualized.
</TABLE>
<PAGE>
PAGE 36
Aggregate Total Return
Aggregate total return represents the cumulative change in value of
an investment for a given period (reflecting change in a
subaccount's accumulation unit value) and is computed by the
following formula:
ERV - P
P
where: P = a hypothetical initial payment of $1,000.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five,
or ten year (or other) period at the end of the
one, five, or ten year (or other) period (or
fractional portion thereof).
Subaccount total return figures reflect the deduction of the
administrative charge and mortality and expense risk fee.
Performance of the subaccounts may be quoted or compared to
rankings, yields, or returns as published or prepared by
independent rating or statistical services or publishers or
publications such as The Bank Rate Monitor National Index,
Barron's, Business Week, Donoghue's Money Market Fund Report,
Financial Services Week, Financial Times, Financial World, Forbes,
Fortune, Global Investor, Institutional Investor, Investor's Daily,
Kiplinger's Personal Finance, Lipper Analytical Services, Money,
Mutual Fund Forecaster, Newsweek, The New York Times, Personal
Investor, Stanger Report, Sylvia Porter's Personal Finance, USA
Today, U.S. News and World Report, The Wall Street Journal and
Wiesenberger Investment Companies Service.
CALCULATING ANNUITY PAYOUTS
Your fixed annuity payout amounts are guaranteed. Once calculated,
your payout will remain the same and never change. To calculate
your annuity payouts we:
o take the total value of your fixed account and the subaccounts
at the annuity start date or the date you have selected to begin
receiving your annuity payouts; then
o using an annuity table we apply the value according to the
annuity payout plan you select.
o The annuity payout table we use will be the one in effect at the
time you choose to begin your annuity payouts. The table will be
equal to or greater than the table in the annuity.
RATING AGENCIES
The following chart reflects the ratings given to American
Centurion Life by independent rating agencies. These agencies
evaluate the financial soundness and claims-paying ability of
insurance companies based on a number of different factors. This
information does not relate to the management or performance of the
variable subaccounts of the Privileged Assets Select Annuity. <PAGE>
PAGE 37
This information relates only to the fixed account and reflects
American Centurion Life's ability to make annuity payouts and to
pay death benefits and other distributions from the annuity.
Rating agency Rating
A.M. Best A+
(Superior)
Duff & Phelps AAA
PRINCIPAL UNDERWRITER
The principal underwriter for the accounts is American Express
Service Corporation which offers the variable contracts on a
continuous basis.
INDEPENDENT AUDITORS
The statutory basis financial statements of American Centurion Life
Assurance Company (a wholly owned subsidiary of IDS Life Insurance
Company) as of December 31, 1995 and 1994, and for the years then
ended, have been audited by Ernst & Young LLP, independent auditors
as stated in their report appearing herein.
RETIREMENT PLANNING
You may have to save more for retirement because social security
and employee savings plans are estimated to cover only 40% of your
retirement savings. The remaining 60% must come from personal
investments, savings and other income.* One way to help save for
retirement is by purchasing a variable annuity. Variable annuity
sales have almost tripled in the last 4 years to over $52 billion
dollars.**
Sources:
* Social Security Administration
**LIMRA 1994 Individual Annuity Market Report
PROSPECTUS
The prospectus dated November 18, 1996, is hereby incorporated in
this Statement of Additional Information by reference.
<PAGE>
PAGE 38
Report of Independent Auditors
The Board of Directors
American Centurion Life Assurance Company
We have audited the accompanying statutory basis balance sheets of
American Centurion Life Assurance Company as of December 31, 1995
and 1994, and the related statutory basis statements of operations,
changes in capital and surplus, and cash flows for the years then
ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion
on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
The Company presents its financial statements in conformity with
accounting practices prescribed or permitted by the New York
Insurance Department. The variances between such practices and
generally accepted accounting principles are described in Note 1.
The effects of these variances are not reasonably determinable but
we believe they are material.
In our opinion, because of the materiality of the effects of the
variances between generally accepted accounting principles and the
accounting practices referred to in the preceding paragraph, the
financial statements referred to above are not intended to and do
not present fairly, in conformity with generally accepted
accounting principles, the financial position of American Centurion
Life Assurance Company at December 31, 1995 and 1994, or the
results of its operations or its cash flows for the years then
ended.
Also, in our opinion, the financial statements referred to above
present fairly, in all material respects, the admitted assets,
liabilities and capital and surplus of American Centurion Life
Assurance Company at December 31, 1995 and 1994, and the results of
its operations and its cash flows for the years then ended, in
conformity with accounting practices prescribed or permitted by the
New York Insurance Department.
Ernst & Young LLP
May 3, 1996
Minneapolis, Minnesota
<PAGE>
PAGE 39
American Centurion Life Assurance Company
a wholly owned subsidiary of IDS Life Insurance Company
The financial statements shown below are those of the insurance
company and not those of any other entity. They are included in
the prospectus for the purpose of informing investors as to the
financial condition of the insurance company and its ability to
carry out its obligations under its variable contracts.
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Balance Sheets - Statutory Basis
<TABLE>
<CAPTION>
Dec. 31,
1995 1994
(thousands)
Admitted Assets
<S> <C> <C>
Bonds (Market: 1995, $109,181; 1994, $90,330) $106,810 $91,404
Cash and short-term investments 4,840 4,323
Total cash and invested assets 111,650 95,727
Accrued investment income 1,500 1,230
Receivable from affiliates 85 1,118
Other assets - 6
Total admitted assets $113,235 $98,081
Liabilities and Capital and Surplus
Liabilities:
Future policy benefits for annuities $ 92,315 $79,089
Future policy benefits for life insurance 176 180
Unpaid claims 225 240
Interest maintenance reserve 110 64
Accrued taxes, licenses and fees 654 159
Accrued expenses and other liabilities 3,620 2,417
Asset valuation reserve 864 705
Total liabilities 97,964 82,854
Capital and surplus (Note 4):
Capital stock, $10 par value per share;
100,000 shares authorized, issued and outstanding 1,000 1,000
Additional paid-in capital 6,600 6,600
Unassigned surplus 7,671 7,627
Total capital and surplus 15,271 15,227
Total liabilities and capital and surplus $113,235 $98,081
See accompanying notes.
<PAGE>
PAGE 40
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statements of Operations - Statutory Basis
Years ended Dec. 31,
1995 1994
(thousands)
Revenues:
Annuity considerations $20,799 $19,055
Net investment income (Note 2) 7,694 6,427
Amortization of interest maintenance reserve 19 23
Other - 41
Total revenues 28,512 25,546
Benefits and expenses:
Annuity and other contract benefits 12,491 9,524
Increase in liabilities for future policy benefits 13,204 13,568
Commissions - 202
General insurance expenses 1,340 1,136
Insurance taxes, licenses and fees, excluding
federal income taxes 62 155
Total benefits and expenses 27,097 24,585
Net gain from operations before federal
income taxes and realized capital losses 1,415 961
Federal income taxes (Note 3) 1,167 110
Net gain from operations before realized
capital gain (loss) 248 851
Net realized capital gain (loss)(Note 2) - -
Net income $ 248 $ 851
See accompanying notes.
<PAGE>
PAGE 41
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statements of Changes in Capital and Surplus -
Statutory Basis
Years ended Dec. 31,
1995 1994
(thousands)
Capital and surplus at beginning of year $15,227 $14,536
Net income 248 851
Change in non-admitted assets (44) -
Increase in asset valuation reserve (160) (160)
Capital and surplus at end of year $15,271 $15,227
See accompanying notes.
<PAGE>
PAGE 42
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statements of Cash Flows - Statutory Basis
Years ended Dec. 31,
1995 1994
(thousands)
Annuity considerations $ 20,799 $ 19,055
Net investment income received, excluding
realized gains and losses 7,539 6,476
Other income 6 59
Contract benefits paid (12,506) (9,784)
Commissions, other expenses and taxes paid,
excluding federal incomes taxes (1,541) (981)
Federal income taxes refunded (paid) (561) 945
Net cash provided by operations 13,736 15,770
Proceeds from bonds sold, matured or repaid 8,863 13,926
Tax on capital gains (41) 10
Cost of bonds acquired (24,270) (26,924)
Other sources (uses) 2,229 (985)
Net increase in cash and short-term investments 517 1,797
Cash and short-term investments at beginning of year 4,323 2,526
Cash and short-term investments at end of year $ 4,840 $ 4,323
See accompanying notes.
</TABLE>
<PAGE>
PAGE 43
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Notes to Financial Statements - Statutory Basis ($ Thousands)
1. Summary of significant accounting policies
Nature of business
American Centurion Life Assurance Company (the Company) issues
direct business consisting primarily of single and installment
premium annuity contracts sold to American Express cardmembers
residing in New York. The Company is licensed to transact
insurance business in New York, Alabama and Delaware at Dec.
31, 1995.
The Company's principal annuity product in terms of amount in
force is the installment premium fixed deferred annuity. The
annuity contract guarantees a minimum interest rate during the
accumulation period (the time before annuity payments begin),
although the Company normally pays a higher rate reflective of
current market rates. The fixed annuity provides for a
surrender charge during the first seven to eight years of the
contract. The Company has also adopted a practice whereby the
higher current rate is guaranteed for a specified period.
Basis of presentation
Effective Jan. 1, 1995, all of the Company's issued and
outstanding stock was dividended by AMEX Life Assurance
Company to American Express Company and then, through a
capital contribution of the net surplus of $15,227,
transferred to IDS Life Insurance Company.
The Company is now a wholly owned subsidiary of IDS Life
Insurance Company (IDS Life), which is a wholly owned
subsidiary of American Express Financial Corporation.
American Express Financial Corporation is a wholly owned
subsidiary of American Express Company. The accompanying
financial statements have been prepared on the basis of
accounting practices prescribed or permitted by the New York
Department of Insurance. Such practices vary from generally
accepted accounting principles for stock life insurance
companies primarily as follows:
-Bonds are carried at cost rather than being classified as
"available for sale" or "held to maturity" and carried at fair
value or cost, respectively.
-Policy acquisition costs, such as commissions and other costs
related to acquiring new business, are expensed in the year
incurred, whereas premiums are recognized over the premium
paying period.
-Reserves for future policy benefits on annuity policies are
based on assumptions recognized by the New York Department of
Insurance rather than the Company's expected mortality,
interest and withdrawals.<PAGE>
PAGE 44
1. Summary of significant accounting policies (continued)
-The asset valuation reserve is reported as a liability rather
than as surplus. Changes in this reserve are reported
directly in unassigned surplus.
-Deferred income taxes are not provided for the effects of
temporary differences in reporting income for financial and
income tax purposes.
-Net realized gains or losses resulting from changes in market
interest rates are deferred and amortized to investment income
in future periods.
-Net unrealized gain or loss in the carrying value of bonds is
reflected directly in unassigned surplus.
The preparation of statutory-basis financial statements
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results
could differ from those estimates.
Investments
Investment values have been determined in accordance with
methods adopted by the National Association of Insurance
Commissioners (NAIC). Bonds not backed by other loans are
carried at amortized cost with premiums or discounts amortized
using the scientific amoritzation method. Pass-through loan-
backed bonds and structured securities are carried at
amortized cost using the scientific amoritzation method and
include anticipated prepayments at the date of purchase.
Significant changes in estimated cash flows and changes in
coupon interest cash flows from original purchase assumptions
are accounted for using the prospective method for structured
securites purchased at a significant premium over par value,
adjusted rate pass-through loan-backed bonds and adjustable
rate structured securities. The retrospective method is used
for all other pass-through loan-backed bonds and structured
securities. When evidence indicates a decline, which is other
than temporary, in the underlying value or earning power of
individual investments, such investments are written down to a
new cost basis by a charge to income.
Realized investment gain or loss is determined on an
identified cost basis.
Statements of cash flows
The Company considers investments with a maturity at the date
of their acquisition of three months or less to be short-term
investments. These investments are carried principally at
amortized cost which approximates market value. Short-term<PAGE>
PAGE 45
1. Summary of significant accounting policies (continued)
investments at Dec. 31, 1995 and 1994 amounted to $2,388 and
$4,391, respectively, and have been included in the caption
cash and short-term investments.
Premium revenue
Annuity considerations and deposit-type funds are recognized
as revenue when received.
Liabilities for future policy benefits
Liabilities for single and installment premium deferred
annuities are greater than or equal to reserves based on the
Commissioners Annuity Reserve Valuation Method at interest
rates ranging from 5.25 percent to 6.75 percent. Liabilities
for fixed annuities in a benefit status are based on the 1983a
Table with an interest rate of 6.25%.
Federal income taxes
The Company is included in the consolidated federal income tax
return of American Express Company. The Company provides for
income taxes on a separate return basis, except that, under an
agreement between American Express Financial Corporation and
American Express Company, tax benefit is recognized for losses
to the extent they can be used in the consolidated tax return.
It is the policy of American Express Financial Corporation and
its subsidiaries that American Express Financial Corporation
will reimburse a subsidiary for any tax benefit.
At Dec. 31, 1995 and 1994, included in accrued taxes, licenses
and fees is $624 and $24, respectively, ultimately payable to
American Express Company for federal income taxes.
2. Investments
Market values of investments have been determined as
prescribed by the NAIC.
Changes in net unrealized appreciation (depreciation) of bonds
for the years ended Dec. 31, 1995 and 1994 were $3,445 and
($2,987), respectively.
Net realized capital gains (losses) for the years ended Dec.
31 are summarized as follows:
1995 1994
Gains (losses) on bonds $101 $(30)
Income tax benefit (expense) (36) 10
65 (20)
Net (gains) losses transferred to
interest maintenance reserve (65) 20
$ - $ -<PAGE>
PAGE 46
2. Investments (continued)
The Company uses the group method of amortization for interest
related gains and losses arising from the sale of fixed income
investments in bonds, notes and debentures, loan-backed bonds
and structured securities.
The amortized cost and market value of investments in bonds
carried at amortized cost at Dec. 31, are as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
1995
<S> <C> <C> <C> <C>
U.S. Government $ 6,759 $ - $ - $ 6,759
Political subdivisions 997 148 - 1,145
Special revenue 34,485 - - 34,485
Public utilities 8,224 268 33 8,459
Industrial and miscellaneous 56,345 1,994 6 58,333
$106,810 $2,410 $ 39 $109,181
Gross Gross
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
1994
U.S. Government $ 3,702 $ - $ 126 $ 3,576
Political subdivisions 997 33 - 1,030
Special revenue 38,214 - - 38,214
Public utilities 6,285 - 525 5,760
Industrial and miscellaneous 42,206 251 707 41,750
$ 91,404 $ 284 $1,358 $ 90,330
</TABLE>
The amortized cost and estimated market value of investments
in bonds at Dec. 31, 1995 by expected maturity are shown below.
Expected maturities may differ from contractual maturities
because borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.
Estimated
Amortized Market
Cost Value
Due in one year or less $ 9,338 $ 9,545
Due from one to five years 48,693 49,774
Due from five to ten years 38,065 38,910
Due from ten to twenty years 7,549 7,717
Due in more than twenty years 3,165 3,235
$106,810 $109,181
Proceeds from sales of investments in bonds during 1995 and
1994 were $8,863 and $13,926, respectively. During 1995 and
1994, gross gains of $105 and $32, respectively, and gross
losses of $4 and $62, respectively, were realized on those
sales.
At Dec. 31, 1995, bonds carried at $1,134 were on deposit with
the State of New York as required by law.
<PAGE>
PAGE 47
2. Investments (continued)
Net investment income for the years ended Dec. 31 is
summarized as follows:
1995 1994
Bonds $7,561 $6,334
Short-term investments 157 141
Other 21 -
7,739 6,475
Less investments expenses 46 48
$7,693 $6,427
At Dec. 31, 1995, investments in bonds comprised 96 percent of
the Company's total cash and invested assets. Securities are
rated by the Securities Valuation Office of the NAIC except
for approximately $4,002 which are rated by American Express
Financial Corporation internal analysts using criteria similar
to Moody's and Standard & Poor's. As of Dec. 31, 1995,
approximately 96 percent of the bond portfolio was invested in
investment-grade securities.
3. Federal income taxes
The Company qualifies as a life insurance company for federal
income tax purposes. As such, the Company is subject to the
Internal Revenue Code provisions applicable to life insurance
companies.
Statutory income before income taxes differs from taxable
income principally due to the capitalization of certain policy
acquisition expenses and differences between policy and
contract liabilities for tax return and statutory financial
statement purposes.
4. Capital and surplus
Capital and surplus available for distribution as dividends to
parent are limited to the Company's capital and surplus as
determined in accordance with accounting practices prescribed
by state insurance regulatory authorities. All dividends must
be approved by the Department of Insurance of the State of New
York.
The Company is required to maintain minimum capital of $1,000
and minimum surplus of $500.
5. Related party transactions
Charges by affiliates for use of joint facilities and other
services aggregated $105 and $428 for 1995 and 1994,
respectively.
<PAGE>
PAGE 48
6. Reinsurance
The Company has one indemnity reinsurance agreement
involving life insurance which is 100% coinsured. Amounts
ceded under this contract were as follows at Dec. 31:
1995 1994
Policy reserves $ 2,818 $ 3,564
Insurance in force 265,564 297,689
Premiums on reinsurance ceded amounted to $1,397 and $1,374
for the years ended Dec. 31, 1995 and 1994, respectively.
The Company remains contingently liable for all reinsurance
ceded to other companies. This contingent liability would
become an actual liability in the event that an assuming
reinsurer should fail to perform its obligations under its
reinsurance agreement with the Company.
7. Annuity reserves
At Dec. 31, 1995, the Company's annuity reserves that are
subject to discretionary withdrawal (with adjustment), subject
to discretionary withdrawal (without adjustment), and not
subject to discretionary withdrawal provisions are summarized
as follows:
Amount Percent
Subject to discretionary withdrawal:
With market value adjustment $ 1 0.0%
At book value less surrender charge 6,703 7.3
At book value with minimal or no charge
or adjustment 85,527 92.6
Not subject to discretionary withdrawal 85 0.1
Total annuity reserves -- before reinsurance 92,316 100.0%
Less reinsurance 1
Net annuity reserves $92,315
8. Employee benefit plans
The Company participates in the American Express Retirement
Plan. Employer contributions to the plan are based on
participants' age, years of service and total compensation for
the year. Funding of retirement costs for this plan complies
with the applicable minimum funding requirements specified by
ERISA. The Company's share of the total net periodic pension
cost was $nil in 1995 and 1994.
The Company also participates in defined contribution
pension plans of American Express Company which cover all
employees who have met certain employment requirements.
Company contributions to the plans are a percent of either
each employee's eligible compensation or basic contributions.<PAGE>
PAGE 49
8. Employee benefit plans (continued)
The Company participates in defined benefit health care plans
of American Express Financial Corporation that provide health
care and life insurance benefits to retired employees. The
plans include participant contributions and service related
eligibility requirements. Upon retirement, such employees are
considered to have been employees of American Express Financial
Corporation. American Express Financial Corporation expenses
these benefits and allocates the expenses to it subsidiaries.
Accordingly, costs of such benefits to the Company are included
in employee compensation and benefits and cannot be identified on
a separate company basis. At Dec. 31, 1995 and 1994, the total
accumulated post retirement benefit obligation has been recorded
as a liability to American Express Financial Corporation.
9. Fair values of financial instruments
The Company discloses fair value information for most on- and
off-balance sheet financial instruments for which it is
practical to estimate that value. Fair value of life
insurance obligations, receivables and all non-financial
instruments, such as deferred acquisition costs are excluded.
Off-balance sheet intangible assets are also excluded.
Management believes the value of excluded assets is
significant. The fair value of the Company, therefore, cannot
be estimated by aggregating the amounts presented.
<TABLE>
<CAPTION>
1995 1994
Carrying Fair Carrying Fair
Financial Assets Value Value Value Value
<S> <C> <C> <C> <C>
Bonds $106,810 $111,172 $91,404 $87,187
Cash and short-term investments 4,840 4,840 4,323 4,323
Financial Liabilities
Future policy benefits for fixed
annuities 92,230 91,975 79,089 78,870
</TABLE>
At Dec. 31, 1995 and 1994, the carrying value and fair value
of future policy benefits for fixed annuities exclude life
insurance-related contracts carried at $85 and $nil,
respectively. The fair value of these benefits is based on
the status of the annuities at Dec. 31, 1995 and 1994. The
fair value of deferred annuities is estimated as the carrying
amount less applicable surrender charges. The fair value for
annuities in non-life contingent payout status is estimated as
the present value of projected benefit payments at rates
appropriate for contracts issued in 1995 and 1994.
<PAGE>
PAGE 50
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Balance Sheet - Statutory Basis
(Unaudited)
Sept. 30,
1996
(thousands)
Admitted Assets
Bonds (Market: Sept. 30, 1996, $138,560) $130,704
Cash and short-term investments 7,526
Total cash and invested assets 138,230
Accrued investment income 2,048
Receivable from affiliates 9
Other assets --
Total admitted assets $140,287
Liabilities and Capital and Surplus
Liabilities:
Future policy benefits for annuities $120,713
Future policy benefits for life insurance 176
Unpaid claims 225
Interest maintenance reserve 59
Accrued taxes, licenses and fees 84
Accrued expenses and other liabilities 3,458
Asset valuation reserve 1,191
Total liabilities 125,906
Capital and surplus:
Capital stock, $10 par value per share;
100,000 authorized, issued and outstanding 1,000
Additional paid-in capital 6,600
Unassigned surplus 6,780
Total capital and surplus 14,380
Total liabilities and capital and surplus $140,287
See accompanying notes.
<PAGE>
PAGE 51
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statement of Operations - Statutory Basis
(Unaudited)
Nine month
period ended
Sept. 30, 1996
(thousands)
Revenues:
Annuity considerations $35,634
Net investment income 6,642
Amortization of interest maintenance reserve 6
Other --
Total revenues 42,282
Benefits and expenses:
Annuity and other contract benefits 11,229
Increase in liabilities for future policy benefits 28,398
Commissions 1,097
General insurance expenses 2,537
Insurance taxes, licenses and fees, excluding
federal income taxes 202
Total benefits and expenses 43,463
Net loss from operations before federal income
taxes and net realized capital gain (loss) (1,181)
Federal income taxes (622)
Net loss from operations before realized
capital gain (loss) (559)
Net realized capital gain (loss) --
Net loss $ (559)
See accompanying notes.
<PAGE>
PAGE 52
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statement of Changes in Capital and Surplus - Statutory Basis
(Unaudited)
Nine month
period ended
Sept. 30, 1996
(thousands)
Capital and surplus at beginning of period $15,271
Net loss (559)
Change in non-admitted assets (5)
Increase in asset valuation reserve (327)
Capital and surplus at end of period $14,380
See accompanying notes.
<PAGE>
PAGE 53
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Statement of Cash Flows - Statutory Basis
(Unaudited)
Nine month
period ended
Sept. 30, 1996
(thousands)
Annuity considerations $35,634
Net investment income received, excluding
realized gains and losses 6,147
Other income --
Contract benefits paid (11,229)
Commissions, other expenses and taxes paid,
excluding federal incomes taxes (3,692)
Federal income taxes paid (271)
Net cash provided by operations 26,589
Proceeds from bonds sold, matured or repaid 7,473
Tax on capital gains 5
Cost of bonds acquired (31,488)
Other sources 107
Net increase in cash and short-term investments 2,686
Cash and short-term investments at beginning
of period 4,840
Cash and short-term investments at end of period $ 7,526
See accompanying notes.
<PAGE>
PAGE 54
AMERICAN CENTURION LIFE ASSURANCE COMPANY
Notes to Financial Statements - Statutory Basis
Sept. 30, 1996 ($ Thousands) (Unaudited)
1. General
In the opinion of the management of American Centurion Life
Assurance Company (the Company), the accompanying unaudited
financial statements contain all adjustments (consisting of
normal recurring adjustments) necessary to present fairly its
balance sheet as of Sept. 30, 1996, and the related statements of
operations, changes in capital and surplus, cash flows for the nine
month period ended Sept. 30, 1996.
The Company is a wholly owned subsidiary of IDS Life Insurance
Company which is a wholly owned subsidiary of American Express
Financial Corporation. American Express Financial Corporation is a
wholly owned subsidiary of American Express Company. The
accompanying financial statements have been prepared on the basis
of accounting practices prescribed or permitted by the New York
Department of Insurance.
2. Nature of business
The Company is a stock life insurance company licensed to transact
insurance business in New York, Alabama and Delaware.
3. Statement of cash flows
The Company considers investments with a maturity at the date of
their acquistion of three months or less to be cash equivalents.
These securities are carried principally at amortized cost
which approximates market value.
<PAGE>
PAGE 55
PART C.
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part B of this Registration
Statement:
American Centurion Life Insurance Company:
Balance Sheets as of Dec. 31, 1995 and 1994.
Statements of Operations for the years ended Dec. 31, 1995
1994.
Statements of Changes in Capital and Surplus for the years
ended Dec. 31, 1995 and 1994.
Statements of Cash Flows for the years ended Dec. 31, 1995
and 1994.
Notes to Financial Statements.
Report of Independent Auditors dated May 3, 1996.
Balance Sheet (unaudited) as of Sept. 30, 1996.
Statement of Operations (unaudited) as of Sept. 30, 1996.
Statement of Changes in Capital and Surplus (unaudited) as of
Sept. 30, 1996.
Statement of Cash Flows (unaudited) as of Sept. 30, 1996.
Notes to Financial Statements (unaudited).
(b) Exhibits:
1. Certificate, establishing the ACL Variable Annuity Account 1
dated December 1, 1995, filed electronically as Exhibit 1 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated herein by reference.
2. Not applicable.
3. Form of Variable Annuity Distribution Agreement, to be filed
by amendment.
4.1 Form of Group Deferred Annuity Certificate for nonqualified
contract (form 38502-NY 10/95), filed electronically as
Exhibit 4.1 to Registrant's Initial Registration Statement
No. 333-00041 is incorporated herein by reference.
4.2 Form of Group Deferred Annuity Certificate for qualified
contract (form 38503-IRA-NY 10/95), filed electronically as
Exhibit 4.2 to Registrant's Initial Registration Statement
No. 333-00041 is incorporated by reference.
4.3 Form of Group Deferred Annuity Contract (form 38501 10/95),
filed electronically as Exhibit 4.3 to Registrant's Initial
Registration Statement No. 333-00041 is incorporated by
reference.
5.1 Form of Group Deferred Variable Annuity Application (form
32041 10/95), filed electronically as Exhibit 5.1 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated by reference.
<PAGE>
PAGE 56
5.2 Form of Variable Annuity Participant Enrollment Form (form
32027C 10/95), filed electronically as Exhibit 5.2 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated by reference.
6.1 Amended and Restated Articles of Incorporation of American
Centurion Life, filed electronically as Exhibit 6.1 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated by reference.
6.2 Amended By-Laws of American Centurion Life, filed
electronically as Exhibit 6.2 to Registrant's Initial
Registration Statement No. 333-00041 is incorporated by
reference.
6.3 Emergency By-Laws of American Centurion Life, filed
electronically as Exhibit 6.3 to Registrant's Initial
Registration Statement No. 333-00041 is incorporated by
reference.
7. Not applicable.
8.1 Form of Participation Agreement, by and among American
Centurion Life and Warburg Pincus Trust and Warburg, Pincus
Counsellors, Inc. and Counsellors Securities, Inc., filed
electronically as Exhibit 8.2 to Registrant's Pre-Effective
Amendment No. 1, Registration Statement No. 333-00041 is
incorporated by reference.
8.2 Form of Participation Agreement, by and among American
Centurion Life, TCI Portfolios, Inc. and Investors Research
Corporation, filed electronically as Exhibit 8.3 to
Registrant's Pre-Effective Amendment No. 1, Registration
Statement No. 333-00041 is incorporated by reference.
8.3 Form of Participation Agreement, between Janus Aspen Series
and American Centurion Life, filed electronically as Exhibit
8.4 to Registrant's Pre-Effective Amendment No. 1,
Registration Statement No. 333-00041 is incorporated by
reference.
8.4 Form of Participation Agreement among INVESCO Variable
Investment Funds, Inc., INVESCO Funds Group, Inc. and
American Centurion Life, filed electronically as Exhibit 8.5
to Registrant's Pre-Effective Amendment No. 1, Registration
Statement No. 333-00041 is incorporated by reference.
9. Opinion of counsel, filed electronically herewith.
10. Consent of Independent Auditors, filed electronically
herewith.
11. Not applicable.
12. Not applicable.
<PAGE>
PAGE 57
13. Copy of schedule for computation of each performance
quotation provided in the Registration Statement in response
to Item 21, filed electronically as Exhibit 13 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated by reference.
14.1 Financial Data Schedule, filed electronically herewith.
14.2 Power of Attorney to sign this Registration Statement dated
Dec. 22, 1995, filed electronically as Exhibit 14.2 to
Registrant's Initial Registration Statement No. 333-00041 is
incorporated by reference.
<PAGE>
PAGE 58
Item 25. Directors and Officers of the Depositor (American
Centurion Life Assurance Company)
<TABLE>
<CAPTION>
Positions and
Name Principal Business Address Offices with Depositor
<S> <C> <C>
Doris A. Anfinson IDS Tower 10 Vice President
Minneapolis, MN 55440
Norma J. Arnold IDS Tower 10 Director
Minneapolis, MN 55440
Robert C. Auriema IDS Tower 10 Director
Minneapolis, MN 55440
Clarence E. Galston IDS Tower 10 Director
Minneapolis, MN 55440
Morris Goodwin, Jr. IDS Tower 10 Vice President and Treasurer
Minneapolis, MN 55440
Jay C. Hatlestad IDS Tower 10 Vice President and Controller
Minneapolis, MN 55440
Robert A. Hatton IDS Tower 10 Director
Minneapolis, MN 55440
William J. Heron, Jr. IDS Tower 10 Director
Minneapolis, MN 55440
Michael J. Hogan IDS Tower 10 Vice President - Variable
Minneapolis, MN 55440 Product Development
Richard W. Kling IDS Tower 10 Director
Minneapolis, MN 55440
David M. Kuplic IDS Tower 10 Vice President - Investments
Minneapolis, MN 55440
Ryan R. Larson IDS Tower 10 Director and Vice President -
Minneapolis, MN 55440 Product Development
Herbert W. Marache Jr.IDS Tower 10 Director
Minneapolis, MN 55440
Kenneth W. Nelson IDS Tower 10 Director
Minneapolis, MN 55440
Doretta Rinaldi IDS Tower 10 Vice President - Marketing
Minneapolis, MN 55440
Stuart A. Sedlacek IDS Tower 10 Director, Chairman and President
Minneapolis, MN 55440
<PAGE>
PAGE 59
Item 25. Directors and Officers of the Depositor (continued)
Positions and
Name Principal Business Address Offices with Depositor
Anne L. Segal IDS Tower 10 Director
Minneapolis, MN 55440
Daniel J. Segner IDS Tower 10 Vice President - Investments
Minneapolis, MN 55440
Guerdon D. Smith IDS Tower 10 Director
Minneapolis, MN 55440
</TABLE>
Item 26. Persons Controlled by or Under Common Control with the
Depositor or Registrant
American Centurion Life Assurance Company is a wholly
owned subsidiary of IDS Life Insurance Company which is a
wholly owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is a
wholly owned subsidiary of American Express Company
(American Express).
The following list includes the names of major
subsidiaries of American Express.
Jurisdiction
Name of Subsidiary of Incorporation
I. Travel Related Services
American Express Travel Related
Services Company, Inc. New York
II. International Banking Services
American Express Bank Ltd. Connecticut
III. Companies engaged in Investors
Diversified Financial Services
American Centurion Life Assurance Company New York
American Enterprise Investment Services Inc. Minnesota
American Enterprise Life Insurance Company Indiana
American Express Financial Advisors Inc. Delaware
American Express Financial Corporation Delaware
American Express Insurance Agency of
Nevada Inc. Nevada
American Express Minnesota Foundation Minnesota
American Express Service Corporation Delaware
American Express Tax and Business Services Minnesota
American Express Trust Company Minnesota
American Partners Life Insurance Company Arizona
IDS Advisory Group Inc. Minnesota
IDS Aircraft Services Corporation Minnesota
<PAGE>
PAGE 60
IDS Cable Corporation Minnesota
IDS Cable II Corporation Minnesota
IDS Capital Holdings Inc. Minnesota
IDS Certificate Company Delaware
IDS Deposit Corp. Utah
IDS Fund Management Limited U.K.
IDS Futures Corporation Minnesota
IDS Futures III Corporation Minnesota
IDS Insurance Agency of Alabama Inc. Alabama
IDS Insurance Agency of Arkansas Inc. Arkansas
IDS Insurance Agency of Massachusetts Inc. Massachusetts
IDS Insurance Agency of Mississippi Inc. Mississippi
IDS Insurance Agency of New Mexico Inc. New Mexico
IDS Insurance Agency of North Carolina Inc. North Carolina
IDS Insurance Agency of Ohio Inc. Ohio
IDS Insurance Agency of Texas Inc. Texas
IDS Insurance Agency of Utah Inc. Utah
IDS Insurance Agency of Wyoming Inc. Wyoming
IDS International, Inc. Delaware
IDS Life Insurance Company Minnesota
IDS Life Insurance Company of New York New York
IDS Management Corporation Minnesota
IDS Partnership Services Corporation Minnesota
IDS Plan Services of California, Inc. Minnesota
IDS Property Casualty Insurance Company Wisconsin
IDS Real Estate Services, Inc. Delaware
IDS Realty Corporation Minnesota
IDS Sales Support Inc. Minnesota
IDS Securities Corporation Delaware
Investors Syndicate Development Corp. Nevada
Item 27. Number of Contractowners
Not applicable.
Item 28. Indemnification
The By-Laws of the depositor provide that it shall
indemnify a director, officer, agent or employee of the
depositor pursuant to the provisions of applicable
statutes or pursuant to contract.
Insofar as indemnification for liability arising under
the Securities Act of 1933 may be permitted to director,
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
<PAGE>
PAGE 61
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) American Express Service Corporation acts as principal
underwriter for the following investment companies:
Strategist Income Fund, Inc.; Strategist Growth Fund, Inc.;
Strategist Growth and Income Fund, Inc.; Strategtist World
Fund, Inc.; Strategist Tax-Free Income Fund, Inc., APL
Variable Annuity Account 1 and IDS Certificate Company.
(b) As to each director, officer or partner of the principal
underwriter:
Name and Principal Position and Offices
Business Address with Underwriter
Norma J. Arnold Vice President-
American Express Company FSD Marketing
American Express Tower
World Financial Center
200 Vesey Street
New York, NY 10285-0001
Robert E. Bruers Vice President and
IDS Tower 10 Chief Financial
Minneapolis, MN 55440 Officer
Colleen Curran Vice President and
IDS Tower 10 Chief Legal Counsel
Minneapolis, MN 55440
Robert Erdman Assistant Treasurer
IDS Tower 10
Minneapolis, MN 55440
George L. Farr Director
American Express Company
American Express Tower
World Financial Center
200 Vesey Street
New York, NY 10285-0001
Janet M. Foster Assistant Secretary
IDS Tower 10
Minneapolis, MN 55440
William J. Heron Jr. President
American Express Company
American Express Tower
World Financial Center
200 Vesey Street
New York, NY 10285-0001<PAGE>
PAGE 62
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Name and Principal Position and Offices
Business Address with Underwriter
Kevin P. Howe Vice President and
IDS Tower 10 Chief Compliance
Minneapolis, MN 55440 Officer
David R. Hubers Executive Vice
IDS Tower 10 President
Minneapolis, MN 55440
Richard W. Kling Vice President
IDS Tower 10
Minneapolis, MN 55440
Donald J. Ledger Assistant Secretary
IDS Tower 10
Minneapolis, MN 55440
Vicki M. Lubben Assistant Vice
IDS Tower 10 President
Minneapolis, MN 55440
Margaret M. McGrath Assistant Treasurer
IDS Tower 10
Minneapolis, MN 55440
Timothy S. Meehan Secretary
IDS Tower 10
Minneapolis, MN 55440
James A. Mitchell Senior Vice President
IDS Tower 10
Minneapoli, MN 55440
Steven J. Ritter Assistant Treasurer
IDS Tower 10
Minneapolis, MN 55440
Karen L. Stone Vice President
American Express Company
American Express Tower
World Financial Center
200 Vesey Street
New York, NY 10285-0001
Gregg A. Syverson Assistant Treasurer
IDS Tower 10
Minneapolis, MN 55440
Leslie R. Tvedt Assistant Treasurer
IDS Tower 10
Minneapolis, MN 55440
<PAGE>
PAGE 63
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Name and Principal Position and Offices
Business Address with Underwriter
Michael L. Weiner Assistant Treasurer
IDS Tower 10
Minneapolis, Mn 55440
Item 30. Location of Accounts and Records
American Centurion Life Assurance Company
20 Madison Avenue Extension
Albany, NY 12203
Item 31. Management Services
Not Applicable
Item 32. Undertakings
(a)(b)(c) These undertakings were filed with Registrant's
Initial Registration Statement, File No. 333-
00041.
(d) The sponsoring insurance company represents that
the fees and charges deducted under the contract,
in the aggregate, are reasonable in relation to
the services rendered, the expenses expected to
be incurred, and the risks assumed by the
insurance company.
<PAGE>
PAGE 64
SIGNATURES
As required by the Securities Act of 1933 and the Investment
Company Act of 1940, American Centurion Life Assurance Company, on
behalf of the Registrant has duly caused this Registration
Statement to be signed on its behalf in the City of Minneapolis,
and State of Minnesota, on the 18th day of November, 1996.
ACL VARIABLE ANNUITY ACCOUNT 1
(Registrant)
By American Centurion Life Assurance Company
(Sponsor)
By /s/ Stuart A. Sedlacek*
Stuart A. Sedlacek
Chairman and President
As required by the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the
capacities indicated on the 18th day of November, 1996.
Signature Title
/s/ Stuart A. Sedlacek* Director, Chairman and
Stuart A. Sedlacek President
/s/ Jay C. Hatlestad* Vice President and
Jay C. Hatlestad Controller
_____________________________ Director
Norma J. Arnold
/s/ Robert C. Auriema* Director
Robert C. Auriema
/s/ Clarence E. Galston* Director
Clarence E. Galston
/s/ Robert A. Hatton* Director
Robert A. Hatton
/s/ William J. Heron Jr.* Director
William J. Heron Jr.
/s/ Richard W. Kling* Director
Richard W. Kling
/s/ Ryan R. Larson* Director
Ryan R. Larson
/s/ Herbert W. Marache Jr.* Director
Herbert W. Marache Jr.
<PAGE>
PAGE 65
Signature Title
/s/ Kenneth W. Nelson* Director
Kenneth W. Nelson
/s/ Anne L. Segal* Director
Anne L. Segal
/s/ Guerdon D. Smith* Director
Guerdon D. Smith
*Signed pursuant to Power of Attorney dated Dec. 22, 1995, filed
electronically as Exhibit 14.2 to Registrant's Initial Registration
Statement No. 333-00041 is incorporated herein by reference.
______________________________
Mary Ellyn Minenko
<PAGE>
PAGE 66
CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 1
This Registration Statement is comprised of the following papers
and documents:
The Cover Page.
Cross-reference sheet.
Part A.
The prospectus.
Part B.
Statement of Additional Information.
Financial Statements.
Part C.
Other Information.
The signatures.
Exhibits.
<PAGE>
PAGE 1
ACL VARIABLE ANNUITY ACCOUNT 1
Registration Number 333-00041/811-07475
EXHIBIT INDEX
Exhibit 9: Opinion of counsel.
Exhibit 10: Consent of Independent Auditors.
Exhibit 14.1: Financial Data Schedule.
<PAGE>
PAGE 1
November 12, 1996
Board of Directors
American Centurion Life Assurance Company
20 Madison Avenue Extension
Albany, NY 12203
Gentlemen:
As General Counsel of American Centurion Life Assurance Company
(the Company), I am familiar with its legal affairs and with ACL
Variable Annuity Account 1 (the Account), which is a separate
account of the Company established by the Company's Board of
Directors in accordance with Section 4240, New York Insurance Law.
I am familiar with the Post-Effective Amendment No. 1 on Form N-4
(File No. 333-00041/811-07475) (the Registration Statement), filed
by the Company on behalf of the Account with the Securities and
Exchange Commission with respect to the Account pursuant to the
Deferred Annuity Contract (the Contract).
I have made such examination of law and examined such documents and
records as in my judgment are necessary and appropriate to enable
me to express the following opinions. I am of the opinion that:
1. The Company is duly incorporated, validly existing and in
good standing under the laws of the State of New York, and is
duly licensed or qualified to do business in New York wherein
the business transacted by it requires such licensing or
qualification. The Company has all corporate power required
to carry on its buisness as now conducted and to issue the
Contracts.
2. The Account is a separate account of the Company, duly
established and validly existing pursuant to New York law.
3. The Contracts, when issued, offered and sold in accordance
with the prospectus contained in the aforesaid Registration
Statement and, upon reliance of local law, will be legal and
binding obligations of the Company in accordance with their
terms.
4. There is no limitation as to the interests in the Account
that may be issued.
<PAGE>
PAGE 2
November 12, 1996
5. There is no material pending or threatened litigation, claims
or assessments (including any unasserted claims or
assessments) against the Company.
Please be advised you are correct in your understanding that I will
advise and consult with you concerning questions of disclosure and
the applicable requirements of Statements of Financial Accounting
Standards No. 5 if, and when, in the course of performing legal
services for the Company or the Accounts with respect to a matter
recognized by me to involve an unasserted claim or assessment that
may require financial statement disclosure or consider disclosure
of any such possible claim or assessment in your financial
statements. You may furnish a copy of this letter to your
independent accountants.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Sincerely,
/s/ Eric L. Marhoun
Eric L. Marhoun
General Counsel and Secretary
ELM/KB/rdh
<PAGE>
PAGE 1
Consent of Independent Auditors
We consent to the reference to our firm under the caption
"Independent Auditors" and to the use of our report dated May 3,
1996 on the statutory basis financial statements of American
Centurion Life Assurance Company in Post-Effective Amendment No. 1
to the Registration Statement (Form N-4 File No. 333-00041) for the
registration of the Privileged Assets Select Annuity to be offered
by American Centurion Life Assurance Company.
Ernst & Young LLP
Minneapolis, Minnesota
November 18, 1996
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 7
<CIK> 0040937690
<NAME> American Centurion Life Assurance Company
<MULTIPLIER> 1000
<CURRENCY> U.S. DOLLAR
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1996
<PERIOD-START> JAN-01-1995 JAN-01-1996
<PERIOD-END> DEC-31-1995 SEP-30-1996
<PERIOD-TYPE> YEAR 9 MONTH
<EXCHANGE-RATE> 1 1
<DEBT-HELD-FOR-SALE> 0 0
<DEBT-CARRYING-VALUE> 106810 130704
<DEBT-MARKET-VALUE> 109181 138560
<EQUITIES> 0 0
<REAL-ESTATE> 0 0
<TOTAL-INVEST> 106810 130704
<CASH> 4840 7526
<RECOVER-REINSURE> 0 0
<DEFERRED-ACQUISITION> 0 0
<TOTAL-ASSETS> 113235 140287
<POLICY-LOSSES> 92491 120889
<UNEARNED-PREMIUMS> 0 0
<POLICY-OTHER> 0 0
<POLICY-HOLDER-FUNDS> 225 225
<NOTES-PAYABLE> 0 0
<COMMON> 1000 1000
0 0
0 0
<OTHER-SE> 14271 13380
<TOTAL-LIABILITY-AND-EQUITY> 113235 140287
20799 35634
<INVESTMENT-INCOME> 7694 6642
<INVESTMENT-GAINS> 0 0
<OTHER-INCOME> 19 6
<BENEFITS> 25695 39627
<UNDERWRITING-AMORTIZATION> 0 0
<UNDERWRITING-OTHER> 1402 3836
<INCOME-PRETAX> 1415 (1181)
<INCOME-TAX> 1167 (622)
<INCOME-CONTINUING> 248 (559)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 248 (559)
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
<RESERVE-OPEN> 0 0
<PROVISION-CURRENT> 0 0
<PROVISION-PRIOR> 0 0
<PAYMENTS-CURRENT> 0 0
<PAYMENTS-PRIOR> 0 0
<RESERVE-CLOSE> 0 0
<CUMULATIVE-DEFICIENCY> 0 0
</TABLE>
