ACL VARIABLE ANNUITY ACCOUNT 2
497, 1997-10-31
Previous: GROUP LONG DISTANCE INC, 8-K, 1997-10-31
Next: ASSET ALLOCATION PORTFOLIOS, POS AMI, 1997-10-31






<PAGE>


   
ACL Personal PortfolioSM
October 29, 1997
Variable Annuity Prospectus
    



The ACL Personal PortfolioSM is a flexible premium variable annuity contract
offered by American Centurion Life Assurance Company (American Centurion Life),
a subsidiary of IDS Life Insurance Company (IDS Life), which is a subsidiary of
American Express Financial Corporation (AEFC). Purchase payments may be
allocated among different accounts, providing variable and/or fixed returns and
payouts. The annuity is available for individual retirement annuities (IRAs),
simplified employee pension plans (SEPs), and nonqualified retirement plans.

ACL Variable Annuity Account 2

Sold by:  American Centurion Life Assurance Company.
Home Office:  20 Madison Avenue Extension, P.O. Box 5555, Albany,
NY  12205-0555.  Telephone:  800-504-0469.

This prospectus contains information about the variable account that you should
know before investing. Refer to "The variable account" in this prospectus.

The prospectus is accompanied or preceded by the following prospectuses: The
Retirement Annuity Mutual Funds (describing IDS Life Aggressive Growth Fund, IDS
Life International Equity Fund, IDS Life Capital Resource Fund, IDS Life Managed
Fund, IDS Life Special Income Fund, and IDS Life Moneyshare Fund); The OCC
Accumulation Trust, formerly known as Quest for Value Accumulation Trust
(describing OCC Accumulation Trust Managed Portfolio and OCC Accumulation Trust
U.S. Government Income Portfolio); Putnam Variable Trust, formerly known as
Putnam Capital Manager Trust (describing Putnam VT Diversified Income Fund,
Putnam VT Growth and Income Fund, Putnam VT High Yield Fund and Putnam VT New
Opportunities Fund); and GT Global Variable Investment Funds (describing GT
Global Variable Latin America Fund and GT Global Variable New Pacific Fund).
Please read these documents carefully and keep them 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 bank or financial institution, and the
securities it offers are not deposits or obligations of, or guaranteed or
endorsed by any bank or financial institution nor are they insured by the
Federal Deposit Insurance Corporation, the Federal Reserve Board or any other
agency. Investments in the annuity involve investment risk including the
possible loss of the principle.


<PAGE>



   
A Statement of Additional Information (SAI) dated October 29, 1997 (incorporated
by reference into this prospectus) and filed with the Securities and Exchange
Commission (SEC), 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.
    


<PAGE>



                                Table of contents

Key terms.....................................................
The ACL Personal PortfolioSM 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.................................
     OCC Accumulation Trust Managed Portfolio.................
     OCC Accumulation Trust U.S. Government Income Portfolio..
     Putnam VT Diversified Income Fund........................
     Putnam VT Growth and Income Fund.........................
     Putnam VT High Yield Fund................................
     Putnam VT New Opportunities Fund.........................
     GT Global Variable Latin America Fund....................
     GT Global Variable New Pacific Fund......................
The fixed account.............................................
Buying your annuity...........................................
     The retirement date......................................
     Beneficiary..............................................
     How to make payments.....................................
Charges.......................................................
     Contract administrative charge...........................
     Variable account administrative charge...................
     Mortality and expense risk fee...........................
     Withdrawal charge........................................
     Waiver of withdrawal 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 subaccounts...................
     Transfer policies........................................
     Two ways to request a transfer or a withdrawal...........
Withdrawals from your contract................................
     Withdrawal policies......................................
     Receiving payment when you request a withdrawal..........
Changing ownership............................................
Benefits in case of death.....................................
The annuity payout period.....................................
     Annuity payout plans.....................................
     Death after annuity payouts begin........................
Taxes.........................................................
Voting rights.................................................



<PAGE>



Substitution of investments...................................
Distribution of the contracts.................................
About American Centurion Life................................
Regular and special reports...................................
        Services................................................
        Table of contents of the Statement of Additional
        Information.............................................



<PAGE>



Key terms

These terms can help you understand details about your annuity.

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 annuity payouts are
based.

Annuity - A 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.

Annuity payouts - An amount paid at regular intervals under one of several plans
available to the owner and/or any other payee. This amount may be paid on a
variable or fixed basis.

Annuity unit - A measure of the value of each variable subaccount used to
calculate the annuity payouts you receive.

Beneficiary - The person designated to receive annuity benefits in case of the
owner's or annuitant's death.

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.

Contract value - The total value of your annuity before any applicable
withdrawal charge and any contract administrative charge have been deducted.

Contract year - A period of 12 months, starting on the effective date of your
contract and on each anniversary of the effective date.

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
allocations, transfers, payout options, etc.). Usually, but not always, the
owner is also the annuitant. The owner is responsible for taxes, regardless of
whether he or she receives the annuity's benefits.

Purchase payments - Payments made to American Centurion Life for an annuity.


<PAGE>



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)
o  Simplified Employee Pension Plans (SEPs)

All other annuities are considered nonqualified annuities.

Retirement date - The date when annuity payouts are scheduled to begin. This
date is first established when you start your contract. You can change it in the
future.

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 - Consists 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.

Withdrawal charge - A deferred sales charge that may be applied if you make a
withdrawal from your annuity before the retirement date.

Withdrawal value - The amount you are entitled to receive if you fully withdraw
your annuity. It is the contract value minus any applicable withdrawal charge
and contract administrative charge.

The ACL Personal PortfolioSM in brief

Purpose: The ACL Personal PortfolioSM 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 retirement date), the annuity provides
lifetime or other forms of payouts to you or to anyone you designate.

Ten-day free look: You may return your annuity to your agent or to our Albany
home office within 10 days after it is delivered to you and receive a full
refund of all your purchase payments.

Accounts:  You may allocate your purchase payments among any or all
of:

o       fourteen variable subaccounts of the variable account, 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. We cannot guarantee that the value at the retirement
        date will equal or exceed the total of purchase payments allocated to
        the variable subaccounts. (p. )

o       one fixed account, which earns interest at rates that are
        adjusted periodically by American Centurion Life.  (p.  )


<PAGE>



Buying the annuity: Your agent will help you complete and submit an application.
Applications are subject to acceptance at our Albany home office. You may buy a
nonqualified annuity or a qualified annuity including an IRA. Payment must be
made in a lump sum with the option of additional payments in the future.

o  Minimum initial payment - $2,000
o  Minimum additional payment - $50
o  Maximum total payment(s) (without prior approval) - $1,000,000

Transfers:  Subject to certain restrictions you may redistribute
your money among accounts without charge at any time until annuity
payouts begin, and once per contract year among the variable
subaccounts thereafter.  You may establish automated transfers
among the fixed account and variable subaccount(s).  (p.  )

Withdrawals:  You may withdraw all or part of your contract value
at any time before the retirement date.  You also may establish
automated partial withdrawals.  Withdrawals may be subject to
charges and tax penalties (including a 10% IRS penalty if
withdrawals are made prior to your reaching age 59 1/2) and may
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 an amount at
least equal to the contract value.  (p.  )

Annuity payouts: The contract value of your investment can be applied to an
annuity payout plan that begins on the retirement 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 may be made on a fixed or variable basis, or
both. Total monthly payouts include amounts from each variable subaccount and
the fixed account. (p. )

Taxes:  Generally, your annuity grows tax-deferred until you fully
withdraw it or begin to receive payouts.  (Under certain
circumstances, IRS penalty taxes may apply.)  Even if you direct
payouts to someone else, you will be taxed on the income if you are
the owner.  (p.  )

Charges: Your ACL Personal PortfolioSM is subject to a $30 annual contract
administrative charge, a 0.15% variable account administrative charge, a 1.25%
mortality and expense risk fee and a withdrawal charge.



<PAGE>



Expense summary

The purpose of this table is to help you understand the various costs and
expenses associated with the ACL Personal PortfolioSM.

You pay no sales charge when you purchase the ACL Personal PortfolioSM. 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 "Contract charges."

Contract Owner Expenses

   Withdrawal charge (contingent deferred sales charge as percent
   of payments)

              Contract Years From         Withdrawal Charge
                Payment Receipt               Percentage
                      1                           7%
                      2                           6%
                      3                           5%
                      4                           4%
                      5                           3%
                      6                           2%
                      7                           1%
                 Thereafter                       0%

   Annual Contract Administrative Charge:       $30

Variable Account Annual Expenses

   Variable Account Administrative Charge
   (as a percentage of average daily net assets
    of the underlying fund)...................................0.15%

   Mortality and Expense Risk Fee
   (as percentage of average daily net assets
    of the underlying fund)...................................1.25%

   Total Variable Account Annual Expenses.....................1.40%

Annual Operating Expenses of Underlying Mutual Funds management fees and other
expenses deducted as a percentage of average net assets as follows:
<TABLE>
<CAPTION>

                                                                                                                OCC**
                        IDS Life       IDS Life       IDS Life                 IDS Life                     Accumulation
                       Aggressive    International    Capital      IDS Life     Special       IDS Life      Trust Managed
                         Growth         Equity        Resource      Managed     Income       Moneyshare     (after expense
                                                                                                             limitations)

<S>                       <C>            <C>            <C>           <C>         <C>           <C>              <C>  
Management fees           0.60%          0.82%          0.60%         0.59%       0.59%         0.50%            0.80%

Other expenses            0.09           0.16           0.08          0.07        0.10          0.06             0.10

Total                     0.69%*         0.98%*         0.68%*        0.66%*      0.69%*        0.56%*           0.90%
</TABLE>



<PAGE>
<TABLE>
<CAPTION>

                           OCC**
                       Accumulation
                     Trust U.S. Gov-     Putnam VT       Putnam VT                                GT Global          GT Global
                      ernment Income    Diversified     Growth and    Putnam VT   Putnam VT New    Variable           Variable
                     (after expense       Income         Income      High Yield  Opportunities   Latin America      New Pacific
                      limitations)                                                              (after expense     (after expense
                                                                                                 reimbursements)    reimbursements)

<S>                       <C>              <C>            <C>          <C>           <C>             <C>               <C>  
Management fees           0.60%            0.70%          0.49%        0.68%         0.63%           1.00%             1.00%

Other expenses            0.42             0.13           0.05         0.08          0.09            0.17              0.12

Total                     1.02%            0.83%+         0.54%+       0.76%+        0.72%+          1.17%++           1.12%++

 *Annualized operating expenses of underlying mutual funds at Dec. 31, 1996.
**The annual expenses of the OCC Accumulation Trust Portfolios (the
   "Portfolios") as of Dec. 31, 1996 have been restated to reflect new
   management fee and expense limitation agreements in effect as of May 1, 1996.
   Additionally, Other Expenses are shown gross of certain expense offsets
   afforded the Portfolios which effectively lowered overall custody expenses.
   Effective May 1, 1996, the expenses of the Portfolios were contractually
   limited by OpCap Advisors so that their respective annualized operating
   expenses (net of any expense offsets) do not exceed 1.25% of their respective
   average daily net assets. Furthermore, through Dec. 31, 1997, the annualized
   operating expenses of the Managed and U.S. Government Income Portfolios will
   be voluntarily limited by OpCap Advisors so that annualized operating
   expenses (net of any expense offsets) of these Portfolios do not exceed 1.00%
   of their respective average daily net assets. Without such contractual and
   voluntary expense limitations, and without giving effect to any expense
   offsets the Management Fees, Other Expenses and Total Portfolio Annual
   Expenses incurred for the fiscal year ended Dec. 31, 1996 would have been
   .60%, 1.74% and 2.34%, respectively, for the U.S. Government Income
   Portfolio; and 80%, .10% and .90%, respectively, for the Managed Portfolio.
  +Operating expenses of the underlying mutual funds at Dec. 31, 1996.
 ++Figures in the "Other Expenses" and "Total" columns are restated from the
   amounts you would have incurred in 1996 to reflect fee and reimbursement or
   waiver arrangements. If there had been no reimbursement of expenses by
   Chancellor LGT Asset Management and no expense reductions, the actual
   expenses of each fund, expressed as a percentage of net assets, with
   "Management fees" stated first, then "Other expenses," followed by "Total,"
   would have been as follows: GT Global Variable Latin America Fund, 1.00%,
   0.42%, 1.42%; and GT Global Variable New Pacific Fund, 1.00%, 0.40%, 1.40%.

Example:*

                                                                                                                OCC
                        IDS Life       IDS Life       IDS Life                 IDS Life                     Accumulation
                       Aggressive    International    Capital      IDS Life     Special       IDS Life      Trust Managed
                         Growth         Equity        Resource      Managed     Income       Moneyshare

You would pay the following expenses on a $1,000 investment, assuming 5% annual
return and full withdrawal at the end of each time period:

 1 year                 $ 92.71       $ 95.55         $ 92.61      $ 92.42        $ 92.71     $ 91.44        $ 94.77

 3 years                 119.98        128.48          119.68       119.09         119.98      116.13         126.14

 5 years                 149.80        163.96          149.31       148.32         149.80      143.37         160.08

10 years                 256.49        284.67          255.50       253.52         256.49      243.54         276.99

You would pay the following expenses on the same investment assuming no
withdrawal or selection of an annuity payout plan at the end of each time
period:

 1 year                 $ 22.71       $ 25.55         $ 22.61      $ 22.42        $ 22.71     $ 21.44        $ 24.77

 3 years                  69.98         78.48           69.68        69.09          69.98       66.13          76.14

 5 years                 119.80        133.96          119.31       118.32         119.80      113.37         130.08

10 years                 256.49        284.67          255.50       253.52         256.49      243.54         276.99
</TABLE>




<PAGE>
<TABLE>
<CAPTION>

                          OCC
                      Accumulation
                       Trust U.S.        Putnam VT      Putnam VT                                    GT Global      GT Global
                       Government       Diversified     Growth and    Putnam VT     Putnam VT New     Variable       Variable
                         Income           Income          Income      High Yield    Opportunities   Latin America   New Pacific

You would pay the following expenses on a $1,000 investment, assuming 5% annual
return and full withdrawal at the end of each time period:

<S>                     <C>              <C>             <C>           <C>            <C>             <C>            <C>
 1 year                 $ 95.94          $ 94.08         $ 91.24       $ 93.40        $ 93.01         $ 97.39        $ 96.91

 3 years                 129.64           124.09          115.54        122.04         120.86          134.00         132.55

 5 years                 165.90           156.67          142.37        153.24         151.28          173.11         170.72

10 years                 288.48           270.21          241.53        263.38         259.45          302.62         297.93

You would pay the following expenses on the same investment assuming no
withdrawal or selection of an annuity payout plan at the end of each time
period:

 1 year                 $ 25.94          $ 24.08         $ 21.24       $ 23.40        $ 23.01         $ 27.39        $ 26.91

 3 years                  79.64            74.09           65.54         72.04          70.86           84.00          82.55

 5 years                 135.90           126.67          112.37        123.24         121.28          143.11         140.72

10 years                 288.48           270.21          241.53        263.38         259.45          302.62         297.93
</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 contract administrative charge is approximated
as a .177% charge based on the estimated average contract size.

Financial statements

   
The SAI dated October 29, 1997 contains:
    

the audited financial statements of American Centurion Life
including:

     -  balance sheets as of Dec. 31, 1996 and Dec. 31, 1995
     -  related statements of income and cash flows for the years
        ended Dec. 31, 1996 and 1995

The SAI does not include financial statements of the variable account because
this is a new account that did not have any activity in 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.
   
The performance figures are calculated on the basis of historical performance of
each fund. "Performance since Inception of the Subaccount" shows performance
since the date the subaccount actually began investing in the fund. Because each
subaccount is new and has not yet begun to invest in the fund, there is no
performance in this category at the present time. "Performance since Inception
of the Fund" shows performance since the beginning of each fund, even if the
subaccount did not invest in the fund on that date. Before the subaccount began
investing in the fund, this category shows what the performance would have been
if the


<PAGE>


subaccount had existed during the illustrated period. Once a subaccount began
investing in the fund, this category shows actual performance. This category
assumes that the annuity was offered prior to October 29, 1997, which it was
not.
    
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.

Average annual total return: Expressed as an average annual compounded rate of
return of a hypothetical investment over a period of one, five and 10 years (or
up to the life of the account if it is less than 10 years old). This figure
reflects deduction of all applicable charges, including the contract
administrative charge, variable account administrative charge, mortality and
expense risk fee, and withdrawal charge, assuming a full withdrawal at the end
of the illustrated period. Optional average annual total return quotations may
be made that do not reflect a withdrawal charge deduction (assuming no
withdrawal).

Aggregate total return: Represents the cumulative change in the value of an
investment over 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
contract administrative charge, mortality and expense risk fee, variable account
administrative charge and withdrawal charge, assuming a withdrawal at the end of
the illustrated period. Optional aggregate total return quotations may be made
that do not reflect a withdrawal charge deduction (assuming no withdrawal).
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 the address or telephone number on the cover.



<PAGE>



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                              IAG
IDS Life International Equity Fund                           IIE
IDS Life Capital Resource Fund                               ICR
IDS Life Managed Fund                                        IMG
IDS Life Special Income Fund                                 ISI
IDS Life Moneyshare Fund                                     IMS
OCC Accumulation Trust Managed Portfolio                     IMD
OCC Accumulation Trust U.S. Government
    Income Portfolio                                         IUS
Putnam VT New Opportunities Fund                             IDI
Putnam VT Growth and Income Fund                             IGI
Putnam VT High Yield Fund                                    IHY
Putnam VT Diversified Income Fund                            INO
GT Global Variable Latin America Fund                        ILA
GT Global Variable New Pacific Fund                          IPA

Each variable subaccount 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 subaccount alone. No variable
subaccount will be charged with liabilities of any other variable account or of
our general business.

The variable account was established under New York law on October 12, 1995, and
the subaccounts are registered together as a single 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. All obligations arising under the contracts are general obligations
of American Centurion Life.

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.



<PAGE>



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.

IDS Life Special Income Fund
Objective: 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.

OCC Accumulation Trust Managed Portfolio
Objective: growth of capital over time.  Invests primarily in
common stocks, bonds and money market and cash equivalent
securities, the percentages of which will vary based on
management's assessment of relative investment values.

OCC Accumulation Trust U.S. Government Income Portfolio
Objective: high level of current income together with protection of
capital.  Invests exclusively in debt obligations, including
mortgage-backed securities, issued or guaranteed by the United
States government, its agencies or instrumentalities.

Putnam VT Diversified Income Fund
Objective: high current income consistent with capital preservation by investing
in the following three sectors of the fixed income securities markets: a U.S.
Government Sector, a High Yield Sector which invests primarly in securities
known as "junk bonds" and an International Sector. Consult the Putnam Variable
Trust prospectus for further information on the risks associated with this
fund's investments in higher-yield, higher-risk fixed income securites.

Putnam VT Growth and Income Fund
Objective: capital growth and current income by investing primarily
in common stocks that offer potential for capital growth, current
income or both.

Putnam VT High Yield Fund
Objective: high current income and, when consistent with this objective, a
secondary objective of capital growth by investing primarily in high-yielding,
lower-rated fixed income securities constituting a portfolio which Putnam
Investment Management, Inc. ("Putnam Management") believes does not involve
undue risk to income or principal.


<PAGE>



Putnam VT New Opportunities Fund
Objective: long-term capital appreciation by investing principally
in common stocks of companies in sectors of the economy which
Putnam Management believes possess above average long-term growth
potential.

GT Global Variable Latin America Fund
Objective: capital appreciation. Invests primarily in a broad range of
securities including common and preferred stock, rights, warrants and securities
convertible into common stock, as well as bonds, notes, debentures or other
forms of indebtedness of Latin American issuers.

GT Global Variable New Pacific Fund
Objective: long-term growth of capital.  Invests under normal
circumstances, at least 65% of its assets in equity securities of
issuers domiciled in Australia, Hong Kong, Indonesia, Malaysia, New
Zealand, Pakistan, the Philippines, Singapore, South Korea, Taiwan
and Thailand.

More comprehensive information regarding each fund is contained in that fund's
prospectus. You should read the fund prospectus and consider carefully, and on a
continuing basis, which fund or combination of funds is best suited to your
long-term investment needs. There is no assurance that the investment objectives
of the funds will be attained nor is there any guarantee that the contract value
will equal or exceed the total purchase payments made. Some funds may involve
more risk than others. Please monitor your investment accordingly.

All funds are available to serve as the underlying investment for variable
annuities, and some funds also are available to serve as the underlying
investment for variable life insurance contracts. It is conceivable that in the
future it may be disadvantageous for variable annuity separate accounts and
variable life insurance separate accounts to invest in the available funds
simultaneously.

Although American Centurion Life and the funds do not currently foresee any such
disadvantages either to variable annuity contract owners or to variable life
insurance policy owners, the boards of directors or trustees of the appropriate
funds will monitor events in order to identify any material conflicts between
such contract owners and policy owners and 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 and variable
annuity separate accounts, the variable annuity contract 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 that 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,

<PAGE>



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 contract, 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 contract
continues to qualify as an annuity for federal income tax purposes. We reserve
the right to modify the contract as necessary to comply with any new tax laws.

IDS Life is the investment manager and AEFC is the investment advisor for each
of the IDS Life funds. IDS International, Inc., a wholly-owned subsidiary of
AEFC, is the sub-investment advisor for IDS Life International Equity Fund.
OpCap Advisors is the investment manager for the OCC Accumulation Trust
portfolios. Putnam Management, is the investment manager for the Putnam VT
funds. Chancellor LGT Asset Management is the investment manager for the GT
Global Funds.

The investment managers and advisors cannot guarantee that the funds will meet
their investment objectives. Please read the funds' prospectuses for complete
information on investment risks, deductions, expenses and other facts you should
know before investing. These prospectuses are available by contacting American
Centurion Life at the home office address or telephone number on the front of
this prospectus.

The fixed account

Purchase payments also may be allocated to the fixed account. The 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 credited and compounded daily to produce an effective annual
interest rate. We may change the interest rates 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.



<PAGE>



Buying your annuity

Your agent will help you prepare and submit your application, and send it along
with your initial purchase payment to our Albany home office. As the owner, you
have all rights and may receive all benefits under the contract. You cannot buy
an annuity or become an annuitant if you are 81 or older (age 76 or older for
qualified annuities).

   When you apply, you can select:
o  the subaccount(s) and/or fixed account 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
   retirement date); and
o  a beneficiary.

   
If your application is complete, we will process it and apply your purchase
payment to your subaccount(s) and fixed account within two business days after
we receive it at our Albany home office. If your application is accepted, we
will send you a contract. If we cannot accept your application within five
business days, we will decline it and return your payment. We will credit
additional purchase payments to your account(s) at the next close of business
after we receive your payments at our Albany home office. Additional purchase
payments may be made to nonqualified and qualified annuities until the
retirement date.
    

The retirement date

Annuity payouts will be scheduled to begin on the retirement 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 retirement date must be:

o  no earlier than the 60th day after the contract's effective
   date; and
o  no later than the annuitant's 90th birthday.

For qualified annuities, to avoid IRS penalty taxes, the retirement date
generally must be:

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 withdrawals from
this annuity, annuity payouts can start as late as the annuitant's 90th
birthday.


<PAGE>



Beneficiary

If death benefits become payable before the retirement date, your named
beneficiary will receive all or part of the contract value. If there is no named
beneficiary, then you or your estate will be the beneficiary. (See "Payment in
case of death" for more about beneficiaries.)

Minimum payment

If single payment:

Nonqualified:       $2,000
Qualified:          $2,000

Minimum additional purchase payment(s):     $50

Maximum payment(s):     $1,000,000 of cumulative payments without
                        prior approval

How to make payments

By letter

Send your check along with your name and contract number to:

Regular mail:

American Centurion Life Assurance Company
P.O. Box 5555
Albany, NY  12205-0555

Express mail:

American Centurion Life Assurance Company
20 Madison Avenue Extension
Albany, NY  12205

Charges

Contract administrative charge

This fee is for establishing and maintaining your records. We deduct $30 from
the contract value on your contract anniversary at the end of each contract
year. We will waive this charge when the contract value is $50,000 or more on
the current contract anniversary.

If you take a full withdrawal from your contract, the $30 annual charge will be
deducted at the time of withdrawal regardless of contract value. The annual
charge cannot be increased and does not apply after annuity payouts begin.

Variable account administrative charge
This charge is applied daily to the variable subaccounts and reflected in the
unit values of the subaccounts. Annually, it totals 0.15% of their average daily
net assets. It covers certain

<PAGE>



administrative and operating expenses of the subaccounts such as accounting,
legal and data processing fees and expenses involved in the preparation and
distribution of reports and prospectuses. The variable account administrative
charge cannot be increased.

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 accumulation unit values of the
subaccounts. The subaccounts pay this fee at the time dividends are distributed
from the funds in which they invest. Annually, the fee totals 1.25% of the
subaccounts 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, 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 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 contract administrative charge and variable account
administrative charge cannot be increased and may not cover our expenses. Any
deficit would have to be made up from our general assets.

We may use any profits realized from the mortality and expense risk fee for any
proper corporate purpose, including, among others, payment of distribution
(selling) expenses. We do not expect that the withdrawal charge, discussed in
the following paragraphs, will cover sales and distribution expenses.

Withdrawal charge
If you withdraw part or all of your contract, you may be subject to a withdrawal
charge. The withdrawal amount you request is determined by drawing from your
total contract value in the following order:

1. First, we withdraw up to 10% of your prior anniversary contract value not yet
withdrawn this contract year. There is no withdrawal charge on withdrawals
totaling up to 10% of your prior anniversary contract value each contract year.

2. Next, we withdraw any contract earnings (contract value minus all purchase
payments received and not previously withdrawn) in excess of the annual 10% free
withdrawal amount. There is no withdrawal charge on contract earnings.

3. Next, if necessary, we withdraw purchase payments received eight or more
contract years before the withdrawal and not previously withdrawn. There is no
withdrawal charge on purchase payments received eight or more contract years
before withdrawal.



<PAGE>



4. Finally, if necessary, we withdraw purchase payments received in the seven
contract years before the withdrawal. There is a withdrawal charge on these
payments. We determine your withdrawal charges by multiplying each of these
payments by the applicable withdrawal charge percentage, and then totaling the
withdrawal charges.

There is a withdrawal charge on payments received seven or less contract years
before withdrawal. We determine your withdrawal charge by multiplying each of
these payments by the applicable withdrawal charge percentage, and then totaling
the withdrawal charges.

The withdrawal charge percentage depends on the number of contract years since
you made the payment(s).

Contract Years From                           Withdrawal Charge
  Payment Receipt                                Percentage
         1                                           7%
         2                                           6%
         3                                           5%
         4                                           4%
         5                                           3%
         6                                           2%
         7                                           1%
    Thereafter                                       0%

Withdrawal charge calculation example

The following is an example of the calculation we would make to determine the
withdrawal charge on a contract with this history:

o       The contract date is July 1, 1998 with a contract year of July 1 through
        June 30 and with an anniversary date of July 1 each year; and

o       We received these payments - $10,000 July 1, 1998, $8,000
        Dec. 31, 2004 and $6,000 Feb. 20, 2006; and

o       The owner withdraws the contract for its total withdrawal
        value of $38,101 on Aug. 5, 2008 and had not made any other
        withdrawals during that contract year; and

o       The prior anniversary July 1, 2008 contract value was
        $38,488.

Withdrawal Charge            Explanation
   $  0                      $3,848.80 is 10% of the prior anniversary
                             contract value withdrawn without withdrawal
                             charge; and

      0                      $10,252.20 is contract earnings in excess
                             of the 10% free withdrawal amount withdrawn
                             without withdrawal charge; and



<PAGE>



      0                      $10,000 July 1, 1998 payment was received
                             eight or more contract years before
                             withdrawal and is withdrawn without
                             withdrawal charge; and

    240                      $8,000 Dec. 31, 2004 is in its fifth
                             contract year from receipt, withdrawn with
                             a 3% withdrawal charge; and

    240                      $6,000 Feb. 20, 2006 is in its fourth
                             contract year from receipt, withdrawn with
                             a 4% withdrawal charge.
- ----------
   $480

The withdrawal charge is calculated so that the total amount minus any
withdrawal charge equals the amount you request. If you take a full withdrawal
from your contract, the $30 contract charge also will be deducted.

Waiver of withdrawal charges There are no withdrawal charges for:

o       withdrawals during the year totaling up to 10% of your prior
        contract anniversary contract value;
o       contract earnings - if any - in excess of the annual 10% free
        withdrawal amount; and
o       required minimum distributions from a qualified annuity after you reach
        age 70 1/2 (for those amounts required to be distributed from this
        annuity only);
o       contracts settled using an annuity payout plan; and
o       death benefits.

Possible group reductions: In some cases lower sales and administrative expenses
may be incurred due to the size of the group, the average contribution and the
use of group enrollment procedures. In such cases, we may be able to reduce or
eliminate the contract administrative and withdrawal charges. However, we expect
this to occur infrequently.

Valuing your investment

Here is how your fixed account and variable subaccounts are valued:

Fixed account: The amounts allocated to the fixed account are valued directly in
dollars and equal the sum of your purchase payments and transfer amounts plus
interest earned, less any amounts withdrawn or transferred and any contract
administrative charge.

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 contract for that subaccount.
Conversely, each time you take a partial withdrawal, transfer amounts out of a

<PAGE>



variable subaccount, or are assessed a contract administrative charge, a certain
number of accumulation units are subtracted from your contract.

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, after deduction of any premium taxes, by the current
accumulation unit value.

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 Determined each business day by:

o       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 and the variable account administrative
        charge 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
        subaccount(s);
o       transfers into or out of the variable subaccount(s);
o       partial withdrawals;
o       withdrawal charges; and/or
o       contract administrative charges.



<PAGE>

Accumulation unit values may fluctuate due to:

o       changes in net asset value of underlying mutual fund(s);
o       dividends distributed to the variable subaccount(s);
o       capital gains or losses of underlying mutual fund(s);
o       mutual fund operating expenses;
o       mortality and expense risk fees; and/or
o       variable account administrative charges.

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. There is no charge
for dollar cost averaging.
    

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. For specific features
contact your agent.
<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              18            5.56

                               Mar          100              17            5.88

you automatically              Apr          100              15            6.67
buy more units
when the per unit              May          100              16            6.25
market price is low....
                               Jun          100              18            5.56

                               Jul          100              17            5.88

                               Aug          100              19            5.26

and fewer units                Sep          100              21            4.76
when the per unit
market price is                Oct          100              20            5.00
high.
</TABLE>

You have paid an average price of only $17.91 per unit over the 10 months, while
the average market price actually was $18.10.

Dollar-cost averaging does not guarantee that any variable subaccount will gain
in value, nor will it protect against a decline in value if market prices fall.
Because this strategy involves continuous investing, your success with
dollar-cost averaging will depend upon your willingness to continue to invest


<PAGE>



regularly through periods of low price levels.  Dollar-cost
averaging can be an effective way to help meet your long-term
goals.

* Some restrictions may apply.

Transferring money between subaccounts
You may transfer money from any one subaccount, or the fixed account, to another
before annuity payouts begin. Certain restrictions apply to transfers involving
the fixed account. 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. There is no charge for transfers. Before making
a transfer, you should consider the risks involved in switching investments.

We may suspend or modify the transfer privileges at any time as follows:

o       Limit the number of transfers to 12 per contract year; and/or
o       Require up to 10 valuation dates between each transfer;
        and/or
o       Limit the maximum transfer amount on any valuation date to
        $2,000,000; and/or
o       Upon 30 days written notice, only accept transfer instructions from you
        and not from your representative, agent or any person acting under a
        power of attorney from you.

We may make these transfer privilege modifications on a uniform basis for all
contractholders in a class, if we determine, in our sole discretion, that the
exercise of transfer rights by one or more contract owners is, or would be, to
the disadvantage of other contract owners.

(For information on transfers after annuity payouts begin, see
"Transfer policies.")

Transfer policies

o       You may transfer contract values between the variable subaccounts or
        from the subaccount(s) to the fixed account at any time. However, if you
        have made a transfer from the fixed account to the subaccount(s), you
        may not make a transfer from any subaccount back to the fixed account
        for six months following that transfer.

o       You may transfer contract values from the fixed account to the variable
        subaccount(s) on or within 30 days before or after the contract
        anniversary (except for automated transfers, which can be set up for
        transfer periods of your choosing subject to certain minimums).

o       If we receive your request on or within 30 days before or after the
        contract anniversary date, the transfer from the fixed account to the
        variable subaccount(s) will be effective on the day we receive it.



<PAGE>



o       We will not accept requests for transfers from the fixed
        account at any other time.

o       Once annuity payouts begin no transfers may be made to or from the fixed
        account, but transfers may be made once per contract year among the
        variable subaccounts.

Two ways to request a transfer or a withdrawal

1       By letter

Send your name, contract number, Social Security number or taxpayer
identification number and signed request for a transfer or withdrawal to:

Regular mail:
American Centurion Life Assurance Company
P.O. Box 5555
Albany, NY  12205-0555

Express mail:
American Centurion Life Assurance Company
20 Madison Avenue Extension
Albany, NY  12203

Minimum amount
Mail transfers:       $500 or entire variable subaccount or fixed
                      account balance
Mail withdrawals:     $500 or entire variable subaccount or fixed
                      account balance

Maximum amount
Mail transfers:       Contract value
Mail withdrawals:     Contract value

2       By automated transfers and automated partial withdrawals

Your agent can help you set up automated transfers among your subaccount(s) or
fixed account or partial withdrawals 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 may not exceed an amount that, if continued, would
        deplete the fixed account or subaccount(s) from which you are
        transferring within 12 months.

o       Automated transfers and automated partial withdrawals are subject to all
        of the contract provisions and terms, including transfer of contract
        values between accounts. Automated withdrawals may be restricted by
        applicable law under some contracts.

o       Automated partial withdrawals may result in IRS taxes and
        penalties on all or part of the amount withdrawn.


<PAGE>

Minimum amount
Automated transfers or withdrawals:         $100 monthly/$250 quarterly

Maximum amount
Automated transfers or withdrawals:         Contract value (except for
                                            automated transfers from the
                                            fixed account)

Withdrawals from your contract

As owner, you may withdraw all or part of your contract at any time before
annuity payouts begin by sending a written request to American Centurion Life.
For total withdrawals we will compute the value of your contract at the close of
business after we receive your request. We may ask you to return the contract.
You may have to pay withdrawal charges (see "Withdrawal charge") and IRS taxes
and penalties (see "Taxes"). No withdrawals may be made after annuity payouts
begin.

Withdrawal policies
If you have a balance in more than one account and request a partial withdrawal,
we will withdraw money from all your subaccounts and/or the fixed account in the
same proportion as your value in each correlates to your total contract value,
unless you request otherwise.

Receiving payment when you request a withdrawal

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 withdrawal 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.

      NOTE:  You will be charged a fee if you request express mail
      delivery.

Changing ownership

You may change ownership of your nonqualified annuity at any time by filing a
change of ownership on a form approved by us and sent to our Albany home office.
The change will become binding upon us when we receive and record it. We will
honor any change of


<PAGE>

ownership request believed to be authentic and will use reasonable procedures to
confirm authenticity. 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 contract 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 a contract 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 as follows:

For contracts where both the owner and annuitant were 75 or younger on the date
the contract was issued and if all withdrawals you have made from this contract
have been without withdrawal charges, the beneficiary receives the greater of:

1.      the contract value; or

2.      the total purchase payments paid less any amounts withdrawn;
        or

3.      on or after the fifth contract anniversary, the death benefit as of the
        most recent fifth contract anniversary adjusted by adding any purchase
        payments made since that most recent fifth contract anniversary and by
        subtracting any amounts withdrawn since that most recent fifth contract
        anniversary.

For contracts where both the owner and annuitant were 75 or younger on the date
the contract was issued and you have made withdrawals subject to withdrawal
charges, the beneficiary receives the contract value.

For contracts where either the owner or annuitant were 76 or older on the date
the contract was issued, the beneficiary receives the contract value.

If your spouse is sole beneficiary under a nonqualified annuity and you die
before the retirement 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 contract in force.

Under a qualified annuity, if the annuitant dies before annuity payouts begin,
and the spouse is the only beneficiary, the spouse may keep the annuity as owner
until the date on which the spouse


<PAGE>



reaches 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.

Payments: 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 contract 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, or other date
   permitted by the Code; and
o  the payout period does not extend beyond the beneficiary's life
   or life expectancy.

When paying the beneficiary, we will determine the contract'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 of the contract, you have the right to decide how and to whom annuity
payouts will be made starting at the retirement 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
contract value on your retirement date. No withdrawal charges are deducted under
the payout plans listed below.

You also decide whether annuity payouts are to be made on a fixed
or variable basis, or a combination of fixed and variable.  Amounts
of fixed and variable payouts depend on:
o  the annuity payout plan you select;
o  the annuitant's age and, in most cases, sex;
o  the annuity table in the contract; and
o  the amounts you allocated to the account(s) at settlement.

In addition, for variable payouts only, amounts depend on the investment
performance of the subaccount(s) you select. These payouts will vary from month
to month because the performance of the underlying mutual funds will fluctuate.
(In the case of fixed annuities, payouts remain the same from month to month.)

For information with respect to transfers between accounts after annuity payouts
begin, see "Transfer policies."

Annuity payout plans

You may choose any one of these annuity payout plans by giving us written
instructions at least 30 days before contract values are to be used to purchase
the payout plan:



<PAGE>



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 you elect. 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 retirement 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 while both the annuitant and a joint annuitant 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 (available as a fixed
payout only):  Monthly payouts are made for a specific payout
period of 10 to 30 years that you elect.  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 retirement date. If you
do not, we will make payouts under Plan B, with 120 monthly payouts guaranteed.

If monthly payouts would be less than $20: We will calculate the amount of
monthly payouts at the time the contract value is used to purchase a payout
plan. If the calculations show that monthly


<PAGE>



payouts would be less than $20, we have the right to pay the contract value to
the owner in a lump sum or to change the frequency of the payouts.

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 contract value is taxable to
you only when you receive a payout or withdrawal. (However, see detailed
discussion below.) Any portion of the annuity payouts and any withdrawals 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
according to our records.

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 annuity contracts issued by the
same company to the same owner during a calendar year are to be taxed as a
single, unified contract when distributions are taken from any one of such
contracts.

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 or
your employer invested in your contract with pre-tax dollars as part of a
qualified retirement plan, such amounts are not considered to be part of your
investment in the contract and will be taxed when paid to you.

Withdrawals: If you withdraw part or all of your contract before your annuity
payouts begin, your withdrawal payment will be taxed to the extent that the
value of your contract immediately before the withdrawal exceeds your
investment. You also may have to pay a 10% IRS penalty for withdrawals made
prior to age 59 1/2. For qualified annuities, other penalties may apply if you
make withdrawals from 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 contract is taxable as ordinary income to the
beneficiary in the year(s) he or she receives the payments.



<PAGE>



Annuities owned by corporations, partnerships or trusts: For nonqualified
annuities 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 income
will remain tax-deferred.

Penalties: If you receive amounts from your contract 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 make
withdrawals from your annuity before your plan specifies that payouts can be
made.

Withholding, generally: If you receive all or part of the contract 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 your annual tax return.

If the payment is part of an annuity payout plan, the amount of withholding
generally is computed using payroll tables. You may 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 may elect not to have any withholding occur.

If the distribution is any other type of payment (such as a partial or full
withdrawal) 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 may elect not to have this withholding
occur.

The state also imposes withholding requirements similar to the federal
withholding described above. Therefore, 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 withdrawal for federal income tax purposes. If the gift
is a currently taxable event for income tax purposes, the amount of deferred
earnings at


<PAGE>



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 value of the annuity at the time of the
transfer.

Collateral assignment of a nonqualified annuity: If you collaterally assign or
pledge your contract, earnings on purchase payments you made after Aug. 13, 1982
will be taxed to you like a withdrawal.

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 advisor if you have
any questions about taxation of your contract.

Tax qualification

The contract is intended to qualify as an annuity for federal income tax
purposes. To that end, the provisions of the contract are to be interpreted to
ensure or maintain such tax qualification, notwithstanding any other provisions
of the contract. We reserve the right to amend the contract to reflect any
clarifications that may be needed or are appropriate to maintain such
qualification or to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such amendments.

Voting rights

As a contract owner with investments in the variable subaccount(s), you may vote
on important mutual fund policies until annuity payouts begin. Once they begin,
the person receiving them has voting rights. We will vote fund shares according
to the instructions of the person with voting rights.

Before annuity payouts begin, 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.

After annuity payouts begin, the number of votes you have is equal to:

o       the reserve held in each subaccount for your contract.
o       divided by the net asset value of one share of the applicable
        underlying mutual fund.

As we make annuity payouts, the reserve for the contract decreases; therefore,
the number of votes also will decrease.

We calculate votes separately for each account. Notice of these meetings, proxy
materials and a statement of the number of votes to which the voter is entitled
will be sent.



<PAGE>



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, investment in the subaccount may be
discontinued or another registered open-end management investment company may be
substituted for fund shares held in the subaccount(s) if American Centurion Life
believes it would be in the best interest of persons having voting rights under
the contract. 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
contract 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 department. American Centurion Life will notify owners of
any substitution or change.

Distribution of the contracts

The contracts will be distributed by banks and financial institutions either
directly or through a network of third-party marketers. American Express
Financial Advisors Inc., the principal underwriter for the variable account,
will pay commissions for the distribution of the contracts to the broker-dealers
of the banks or financial institutions or the broker-dealers of the third-party
marketers who have entered into distribution agreements with American Express
Financial Advisors. These commissions will not be more than 7% of purchase
payments received on the contracts.

From time to time, American Centurion Life may pay or permit other promotional
incentives, in cash or credit or other compensation.

About American Centurion Life

ACL Personal PortfolioSM is issued by American Centurion Life. American
Centurion Life is a wholly-owned subsidiary of IDS Life, which is a wholly-owned
subsidiary of AEFC. AEFC is a wholly-owned subsidiary of American Express
Company. American Express Company is a financial services company principally
engaged through subsidiaries (in addition to AEFC) 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 home office is located at 20
Madison Avenue Extension, P.O. Box 5555, Albany, NY 12205-0555. American
Centurion Life is licensed in the states of Alabama, Delaware, and New York and
conducts a conventional life insurance business in New York.


<PAGE>



American Express Financial Advisors Inc. is the principal
underwriter for the variable account.  Its home office is IDS Tower
10, Minneapolis, MN 55440-0010.  American Express Financial
Advisors 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 Financial
Advisors is a wholly-owned subsidiary of AEFC.

The AEFC family of companies offers not only insurance and annuities, but also
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.

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 annuity and its underlying
investments.

Table of contents of the Statement of Additional Information

Performance information...............................
Calculating annuity payouts...........................
Rating agencies.......................................
Principal underwriter.................................
Independent auditors..................................
Saving for retirement.................................
Prospectus............................................
Financial statements -
     American Centurion Life Assurance Company
- -------------------------------------------------------------------
Please check the appropriate box to receive a copy of the Statement of
Additional Information for:

____ ACL Personal PortfolioSM

____ IDS Life Retirement Annuity Mutual Funds

____ The OCC Accumulation Trust

____ Putnam Variable Trust

____ GT Global Variable Investment Funds



<PAGE>


Mail your request to:

American Centurion Life Assurance Company
P.O. Box 5555
Albany, NY  12205-0555


American Centurion Life will mail your request to:

Your name _____________________________________________________

Address _______________________________________________________

City __________________________ State ____________ Zip ________



<PAGE>









                       STATEMENT OF ADDITIONAL INFORMATION

                                       for

                             ACL PERSONAL PORTFOLIO SM


                         ACL VARIABLE ANNUITY ACCOUNT 2

   
                                October 29, 1997
    


ACL Variable Annuity Account 2 is a separate account established and maintained
by American Centurion Life Assurance Company
(American Centurion Life).

   
This Statement of Additional Information (SAI), dated October 29, 1997 is not a
prospectus. It should be read together with the prospectus dated October 29,
1997 which may be obtained from your agent, or by writing or calling American
Centurion Life at the address or telephone number below.
    



American Centurion Life Assurance Company
20 Madison Avenue Extension
P.O. Box 5555
Albany, NY  12205-0555
800-504-0469


<PAGE>

                                TABLE OF CONTENTS

Performance Information.......................................p.

Calculating Annuity Payouts...................................p.

Rating Agencies...............................................p.

Principal Underwriter.........................................p.

Independent Auditors..........................................p.

Saving for Retirement.........................................p.

Prospectus....................................................p.

Financial Statements
     - American Centurion Life Assurance Company



<PAGE>

PERFORMANCE INFORMATION

   
The following performance figures are calculated on the basis of historical
performance of each fund. "Performance since Inception of the Subaccount" shows
performance since the date the subaccount actually began investing in the fund.
Because each subaccount is new and has not yet begun to invest in the fund,
there is no performance in this category at the present time. "Performance since
Inception of the Fund" shows performance since the beginning of each fund, even
if the subaccount did not invest in the fund on that date. Before the subaccount
began investing in the fund, this category shows what the performance would have
been if the subaccount had existed during the illustrated period. Once a
subaccount began investing in the fund, this category shows actual performance.
This category assumes that the annuity was offered prior to October 29, 1997,
which it was not.
    

Calculation of Yield for the IDS Life Moneyshare Fund Subaccount

Simple yield for the subaccount investing in the IDS Life Moneyshare Fund 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).

The value of the hypothetical subaccount includes the amount of any declared
dividends, the value of any shares purchased with any dividend paid during the
period and any dividends declared for such shares. The variable subaccount's
yield does not include any realized or unrealized gains or losses, nor does it
include the effect of any applicable surrender charge.

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:

                                                365/7
      Compound Yield =[(Base Period Return + 1)      ]-1

                Annualized Yields based on Seven-Day Period ended
                                  Dec. 31, 1996

Subaccount investing in:          Simple Yield       Compound Yield
IDS Life Moneyshare Fund              3.26%               3.32%

Calculation of Yield for the IDS Life Special Income Fund
Subaccount

For the subaccount investing in the IDS Life Special Income Fund quotations of
yield will be based on all investment income earned during a particular 30-day
period, less expenses accrued during the


<PAGE>

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)
           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.

           Annualized yield based on 30-Day Period ended Dec. 31, 1996

Subaccount investing in:          Yield
IDS Life Special Income           7.22%

Calculation of Average Annual Total Return

Quotations of average annual total return for any subaccount will be expressed
in terms of the average annual annuity compounded rate of return of a
hypothetical investment in the contract over a period of one, five and 10 years
(or, if less, up to the life of the account), 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 10-year (or other) period
               at the end of the one-, five- or 10-year (or other) period (or
               fractional portion thereof)




<PAGE>

           Average Annual Total Return For Period Ended Dec. 31, 1996

Average Annual Total Return with Withdrawal
<TABLE>
<CAPTION>

                                                                               Since
Subaccount investing in:                     1 Year     5 Year     10 Year     Inception
IDS LIFE
<S>                                          <C>         <C>        <C>         <C>
  Aggressive Growth Fund (1/92)*              7.49%         -%          -%      10.23%
  Capital Resource Fund (10/81)              -0.39       6.50       12.10           -
  International Equity Fund (1/92)            1.07          -           -        7.53
  Managed Fund (4/86)                         8.24       8.80       10.74           -
  Moneyshare Fund (10/81)                    -3.06       2.08        3.84           -
  Special Income Fund (10/81)                -1.31       7.73        7.20           -

OCC ACCUMULATION TRUST
  Managed Portfolio (8/88)                   13.94      17.05           -        18.45

GT GLOBAL
  Variable Latin America Fund (2/93)         13.64          -           -         7.99
  Variable New Pacific Fund (2/93)           22.05          -           -         7.44

Putnam VT
  Diversified Income Fund (7/93)              0.38          -           -         4.62
  Growth and Income Fund (12/87)             13.10      14.02           -        13.94
  High Yield Fund (12/87)                     4.12      11.54           -        10.92
  New Opportunities Fund (5/94)               1.62          -           -        20.60

Average Annual Total Return without Withdrawal

                                                                               Since
Subaccount Investing in:                     1 Year     5 Year     10 Year     Inception

IDS Life
  Aggressive Growth Fund (1/92)              14.49%         -%          -%       10.64%
  Capital Resource Fund (10/81)               6.36       6.81       12.10            -
  International Equity Fund (1/92)            7.93          -           -         7.99
  Managed Fund (4/86)                        15.24       9.08       10.74            -
  Moneyshare Fund (10/81)                     3.48       2.45        3.84            -
  Special Income Fund (10/81)                 5.37       8.03        7.20            -

OCC ACCUMULATION TRUST
  Managed Portfolio (8/88)                   20.94      17.26           -        18.45

GT GLOBAL
  Variable Latin America (2/93)              20.64          -           -         8.82
  Variable New Pacific Fund (2/93)           29.05          -           -         8.28

Putnam VT
  Diversified Income Fund (7/93)              7.18          -           -         5.66
  Growth and Income Fund (12/87)             20.10      14.26           -        13.94
  High Yield Fund (12/87)                    11.12      11.80           -        10.92
  New Opportunities Fund (5/94)               8.52          -           -        22.02
</TABLE>

 *inception dates of the funds are shown in parentheses.


<PAGE>

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 10 year (or other) period at the end of the
               one, five, or 10 year (or other) period (or
               fractional portion thereof)

The Securities and Exchange Commission (SEC) requires that an assumption be made
that the contract owner withdraws the entire contract at the end of the one,
five and 10 year periods (or, if less, up to the life of the subaccount) for
which performance is required to be calculated. In addition, performance figures
may be shown without the deduction of a withdrawal charge.

Total return figures reflect the deduction of all applicable charges including
the contract administrative charge, variable account administrative charge, and
mortality and expense risk fee.

Performance of the subaccount 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, CDA Technologies, 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, Morningstar, Mutual Fund Forecaster,
Newsweek, The New York Times, Personal Investor, Stanger Report, Sylvia Porter's
Personal Finance, USA Today, U.S. News & World Report, The Wall Street Journal
and Wiesenberger Investment Companies Service.

CALCULATING ANNUITY PAYOUTS

The Variable Account

The following calculations are done separately for each of the subaccounts of
the variable account. The separate monthly payouts, added together, make up your
total variable annuity payout.

Initial Payout:  To compute your first monthly payment, we:

o determine the dollar value of your annuity as of the valuation date seven days
before the retirement date; then o apply the result to the annuity table
contained in the contract or another table at least as favorable. The annuity
table shows the amount of the first monthly payment for each $1,000 of value
which depends on factors built into the table, as described below.

Annuity Units: The value of your subaccount is then converted to annuity units.
To compute the number credited to you, we divide the first monthly payment by
the annuity unit value (see below) on the valuation date on (or next day
preceding) the seventh calendar day before the retirement date. The number of
units in your subaccount is fixed. The value of the units fluctuates with the
performance of the underlying mutual fund.




<PAGE>

Subsequent Payouts:  To compute later payouts, we multiply:
o  the annuity unit value on the valuation date on or immediately
preceding the seventh calendar day before the payout is due; by
o  the fixed number of annuity units credited to you.

Annuity Table: The table shows the amount of the first monthly payment for each
$1,000 of contract value according to the age and, when applicable, the sex of
the annuitant. (Where required by law, we will use a unisex table of settlement
rates.) The table assumes that the contract value is invested at the beginning
of the annuity payout period and earns a 5% rate of return, which is reinvested
and helps to support future payouts.

Annuity Unit Values: This value was originally set at $1 for each subaccount. To
calculate later value we multiply the last annuity value by the product of: o
the net investment factor; and o the neutralizing factor. The purpose of the
neutralizing factor is to offset the effect of the assumed investment rate built
into the annuity table. With an assumed investment rate of 5%, the neutralizing
factor is 0.999866 for a one day valuation period.

Net Investment Factor:
This value is determined each business day by: o 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 net
investment factor may be greater or less than one, and the accumulation unit
value may increase or decrease. You bear this investment risk in a variable
subaccount.

The Fixed Account

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 value of your fixed account at the retirement 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; and 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 your contract.

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


<PAGE>

insurance companies based on a number of different factors.  This
information does not relate to the management or performance of the
variable subaccounts of ACL Personal Portfolio SM.  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 variable accounts is American Express
Financial Advisors Inc. which offers the variable contracts on a continuous
basis.

INDEPENDENT AUDITORS

The financial statements of American Centurion Life Assurance Company (a wholly
owned subsidiary of IDS Life Insurance Company) as of December 31, 1996 and
1995, and for the years then ended, have been audited by Ernst and Young LLP,
independent auditors as stated in their report appearing herein.

SAVING FOR RETIREMENT

You may have to save more for retirement because the average person lives 17
years in retirement. Social Security and pensions will not cover your expenses
in retirement. Sixty cents of every retirement dollar must come from your
personal savings.

Sources:       Social Security Administration, U.S. Department of
               Health and Human Services.

PROSPECTUS

   
The prospectus dated October 29, 1997, is hereby incorporated in this SAI by
reference.
    


<PAGE>


American Centurion Life Financial Information

The financial  statements shown below are those of the insurance company and not
those of any other  entity.  They are included for the purpose of informing  the
investor 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

                                                       Dec. 31,        Dec. 31,
 ASSETS                                                  1996            1995
 ------                                                ----------      -------
                                                              (thousands)
Investments  in fixed  maturities:  
Held to maturity,  at  amortized  cost (Fair value:
1996, $19,958; 1995, $24,191)                           $ 19,579        $ 23,222
Available for sale, at fair value (Amortized cost:
1996, $134,631; 1995, $83,589)                           136,091          86,980
                                                        --------        --------
                                                         155,670         110,202

Cash and cash equivalents                                 13,856           2,531
Amounts recoverable from reinsurance                       2,728           3,402
Other accounts receivable                                     14              86
Accrued investment income                                  2,104           1,500
Deferred policy acquisition costs                          4,364           1,318
Deferred income taxes                                         --             144
Other assets                                                  41              44
                                                      ----------    ------------

Total assets                                            $178,777        $119,227
                                                         =======         =======
LIABILITIES AND STOCKHOLDER'S EQUITY

Liabilities:
Future policy benefits:
Fixed annuities                                         $139,362        $ 92,789
Traditional life insurance                                 1,883           3,579
Disability income insurance                                  225             225

Policy claims and other policyholders' funds                 691             263
Amounts due to broker                                      4,916              --
Deferred income taxes                                        592              --
Other liabilities                                             34           1,121
                                                        --------       ---------
Total liabilities                                        147,703          97,977

Stockholder's equity:
Capital stock, $10 par value per share;
100,000 shares authorized,
issued and outstanding                                     1,000           1,000
Additional paid-in capital                                16,600           6,600
Net unrealized gain on investments                           863           2,204
Retained earnings                                         12,611          11,446
                                                      ----------      ----------
Total stockholder's equity                                31,074          21,250
                                                      ----------      ----------

Total liabilities and stockholder's equity              $178,777        $119,227
                                                         =======         =======
Commitments and contingencies (note 6)

See accompanying notes.

<PAGE>
                    AMERICAN CENTURION LIFE ASSURANCE COMPANY
                              STATEMENTS OF INCOME

                                                         Years ended Dec. 31,
                                                        1996              1995
                                                       ------            -----
                                                              (thousands)
Revenues:
Contractholder charges                                  $  306           $  299
Net investment income                                    8,851            7,734
Net realized gain (loss) on investments                    (57)             112
                                                       -------           ------

Total revenues                                           9,100            8,145
                                                        ------           ------

Benefits and expenses:
Interest credited on investment contracts                5,849            4,670
Amortization of deferred policy
acquisition costs                                           21              294
Other operating expenses                                 1,387              710
                                                        ------           ------

Total expenses                                           7,257            5,674
                                                        ------           ------


Income before income taxes                               1,843            2,471

Income taxes                                               678              885
                                                       -------          -------

Net income                                             $ 1,165          $ 1,586

                                                         =====            =====



See accompanying notes.


<PAGE>
                    AMERICAN CENTURION LIFE ASSURANCE COMPANY
                            STATEMENTS OF CASH FLOWS

                                                          Years ended Dec. 31,
                                                          1996            1995
                                                              (thousands)
Cash flows from operating activities:
Net income                                              $  1,165       $  1,586
Adjustments to reconcile net income to
net cash (used in) provided by 
operating activities:
Change in reinsurance receivable                             674            166
Change in accounts receivable                                 72          1,059
Change in accrued investment income                         (604)          (270)
Change in deferred policy acquisition
costs, net                                                (3,177)           252
Change in liabilities for future policy
benefits for traditional life and
disability income insurance                               (1,696)            --
Change in other assets                                         3            (44)
Change in policy claims and other
policyholders' funds                                         428            (97)
Change in deferred income taxes                            1,457           (640)
Change in other liabilities                               (1,087)           386
Amortization of premium
(accretion of discount), net                                  56            101
Net realized (gain) loss on investments                       57           (112)
Other, net                                                    --            (75)
                                                      ----------     -----------
Net cash (used in) provided by
operating activities                                      (2,652)         2,312
                                                         -------      ---------

Cash flows from investing activities: 
Fixed maturities held to maturity:
Purchases                                                     --         (1,980)
Maturities                                                 2,603          3,443
Sales                                                        477             --
Fixed maturities available for sale:
Purchases                                                (59,425)       (22,290)
Maturities                                                 7,261          4,819
Sales                                                      1,572            496
Change in due to broker                                    4,916         (1,446)
                                                       ---------     -----------
Net cash used in
investing activities                                     (42,596)       (16,958)
                                                        --------      ----------

Cash flows from financing activities: 
Activity related to investment contracts:
Considerations received                                   55,594         20,876
Surrenders and other benefits                            (14,870)       (12,691)
Interest credited to account balances                      5,849          4,670
Capital contribution from parent                          10,000              -
                                                         -------  -------------
Net cash provided by
financing activities                                      56,573         12,855
                                                        --------      ---------

Net increase (decrease) in cash and 
cash equivalents                                          11,325         (1,791)

Cash and cash equivalents at beginning of year             2,531          4,322
                                                       ---------       --------

Cash and cash equivalents at end of year              $   13,856     $    2,531
                                                         =======        =======
See accompanying notes.

<PAGE>
                    AMERICAN CENTURION LIFE ASSURANCE COMPANY
                          NOTES TO FINANCIAL STATEMENTS
                                  ($ thousands)

1.   Summary of significant accounting policies

     Nature of business

     American  Centurion Life Assurance  Company (the Company)  issues  business
     consisting  primarily of single and installment  premium annuity  contracts
     sold to New York residents.  The Company is licensed to transact  insurance
     business in New York, Alabama and Delaware.

     Basis of presentation

     The Company is 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  in  conformity  with  generally  accepted
     accounting  principles  which  vary  in  certain  respects  from  reporting
     practices  prescribed or permitted by the New York  Department of Insurance
     (see Note 8).

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  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

     Fixed  maturities  that the  Company has both the  positive  intent and the
     ability to hold to maturity are  classified as held to maturity and carried
     at amortized  cost. All other fixed  maturities  and all marketable  equity
     securities  are classified as available for sale and carried at fair value.
     Unrealized gains and losses on securities  classified as available for sale
     are  carried  as a  separate  component  of  stockholder's  equity,  net of
     deferred taxes.

     Realized investment gain or loss is determined on an identified cost basis.

     Prepayments  are  anticipated  on certain  investments  in  mortgage-backed
     securities in determining  the constant  effective  yield used to recognize
     interest  income.  Prepayment  estimates are based on information  received
     from brokers who deal in mortgage-backed 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 the fair value by a charge to income.

     Statements of cash flows

     The  Company  considers  investments  with a maturity  at the date of their
     acquisition  of  three  months  or  less  to  be  cash  equivalents.  These
     securities are carried  principally  at amortized  cost which  approximates
     fair value.

     Supplementary  information to the statements of cash flows is summarized as
     follows:

                                                          1996              1995
                                                         -------           -----
     Cash paid during the year for:
       Income taxes                                       $257              $531

    
<PAGE>

Recognition of profits on fixed annuity contracts

     Profits on fixed deferred  annuities are recognized by the Company over the
     lives of the contracts,  using primarily the retrospective  deposit method.
     This method recognizes profits over the lives of the policies in proportion
     to the estimated gross profits expected to be realized.

     Deferred policy acquisition costs

     The costs of acquiring new business, principally sales compensation, policy
     issue costs,  and certain  sales  expenses,  have been  deferred on annuity
     contracts. These costs are amortized as a percentage of the estimated gross
     profits expected to be realized on the policies.

     Liabilities for future policy benefits

     Liabilities for single premium deferred annuities and installment annuities
     are  accumulation  values.  Liabilities  for fixed  annuities  in a benefit
     status are based on the 1983a Table with interest at 6.25%.

     Federal income taxes

     The Company's taxable income 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 on the
     consolidated  tax return.  It is the policy of American  Express  Financial
     Corporation  and  its   subsidiaries   that  American   Express   Financial
     Corporation will reimburse subsidiaries for all tax benefits.

     Included  in other  liabilities  at Dec.  31,  1996 and 1995 are ($185) and
     $758,  respectively,  (receivable  from)  payable  to IDS Life for  federal
     income taxes.

     Accounting changes

     The Financial  Accounting  Standards  Board's (FASB) Statement of Financial
     Accounting  Standards No. 121, "Accounting for the Impairment of Long-Lived
     Assets and for Long-Lived  Assets to Be Disposed Of," was effective Jan. 1,
     1996. The new rule did not have a material impact on the Company's  results
     of operations or financial condition.

2.   Investments

     Fair values of  investments  in fixed  maturities  represent  quoted market
     prices and estimated values when quoted prices are not available. Estimated
     values are  determined by  established  procedures  involving,  among other
     things,  review of market  indices,  price  levels of current  offerings of
     comparable issues, price estimates and market data from independent brokers
     and financial files.

     Net realized  (loss) gain on  investments  was ($57) and $112 for the years
     ended Dec. 31, 1996 and 1995,  respectively,  and was entirely due to sales
     of fixed maturities.

     Changes in net unrealized appreciation (depreciation) of investments 
     for the years ended Dec. 31 are summarized as follows:
                                                          
                                                           1996            1995
     Investments in fixed maturities:
       Held to maturity                                $  (590)           $6,587
       Available for sale                               (1,931)            2,283
<PAGE>

     The amortized  cost,  gross  unrealized  gains and losses and fair value of
     investments in fixed maturities at Dec. 31, 1996 are as follows:
<TABLE>
<CAPTION>

                                                                   Gross              Gross
                                                  Amortized      Unrealized        Unrealized          Fair
     Held to maturity                                 Cost         Gains             Losses            Value
     ----------------                             ---------      ---------          --------        --------
     <S>                                          <C>             <C>               <C>              <C>      
     Corporate bonds and obligations              $  17,995       $    421          $    154         $  18,262
     Mortgage-backed securities                       1,584            112                --             1,696
                                                 ----------       --------         ---------        ----------
                                                  $  19,579       $    533          $    154         $  19,958
                                                  =========       ========          ========         =========

     Available for sale
     U.S. Government agency obligations          $    2,095     $       --         $      32        $    2,063
     State and municipal obligations                  1,000             21                --             1,021
     Corporate bonds and obligations                 74,327          1,808               369            75,766
     Mortgage-backed securities                      57,209            638               606            57,241
                                                -----------       --------            ------       -----------
                                                   $134,631        $ 2,467           $ 1,007          $136,091
                                                   ========        =======           =======          ========
</TABLE>

     The change in net unrealized gain on available for sale securities included
     as a separate component of stockholder's equity, net of deferred taxes, was
     $1,341 in 1996.

     The amortized  cost,  gross  unrealized  gains and losses and fair value of
     investments in fixed maturities at Dec. 31, 1995 are as follows:
<TABLE>
<CAPTION>

                                                                   Gross              Gross
                                                  Amortized      Unrealized        Unrealized          Fair
     Held to maturity                                 Cost         Gains             Losses            Value
     ----------------                             ---------      ---------          --------        --------
     <S>                                          <C>             <C>                <C>            <C>       
     Corporate bonds and obligations              $  21,199       $    848           $    29        $   22,018
     Mortgage-backed securities                       2,023            150                --             2,173
                                                -----------      ---------         ---------      ------------
                                                  $  23,222       $    998           $    29        $   24,191
                                                  =========       ========           =======        ==========

     Available for sale
     U.S. Government agency obligations          $    2,104      $      31           $     2       $     2,133
     Corporate bonds and obligations                 42,174          2,623                 5            44,792
     Mortgage-backed securities                      39,311            944               200            40,055
                                                -----------       --------            ------       -----------
                                                  $  83,589        $ 3,598            $  207        $   86,980
                                                  =========        =======            ======        ==========
</TABLE>

     The change in net unrealized gain on available for sale securities included
     as a separate component of stockholder's equity, net of deferred taxes, was
     $3,934 in 1995.
<PAGE>

     The amortized  cost and fair value of  investments  in fixed  maturities at
     Dec. 31, 1996 by contractual  maturity are shown below.  Actual  maturities
     will differ from  contractual  maturities  because  borrowers  may have the
     right to call or prepay  obligations  with or  without  call or  prepayment
     penalties.

                                              Amortized                  Fair
     Held to maturity                             Cost                   Value

     Due in one year or less                 $    1,502               $   1,505
     Due from one to five years                  12,840                  13,101
     Due from five to ten years                   2,019                   2,094
     Due in more than ten years                   1,634                   1,562
     Mortgage-backed securities                   1,584                   1,696
                                             ----------              ----------
                                              $  19,579               $  19,958
                                              =========               =========

                                              Amortized                  Fair
     Available for sale                           Cost                   Value

     Due in one year or less               $      1,249             $     1,261
     Due from one to five years                  22,708                  23,569
     Due from five to ten years                  43,626                  44,152
     Due in more than ten years                   9,839                   9,868
     Mortgage-backed securities                  57,209                  57,241
                                           ------------             -----------
                                            $   134,631              $  136,091
                                            ===========              ==========


     During the year ended Dec. 31, 1996, fixed maturities classified as held to
     maturity  were sold with  amortized  cost of $500.  Net gains and losses on
     these sales were not  significant.  The sale of these fixed  maturities was
     due to significant  deterioration in the issuers'  creditworthiness.  There
     were no sales of fixed maturities classified as held to maturity in 1995.

     In addition, fixed maturities available for sale were sold during 1996 with
     proceeds  of $1,572  and gross  realized  gains and  losses of $36 and $71,
     respectively.  In 1995, fixed maturities  available for sale were sold with
     proceeds  of $496 and  gross  realized  gains  and  losses  of $nil and $4,
     respectively.

     At Dec. 31, 1996, bonds  carried at $1,094 were on deposit with various 
     states as required by law.

     Net investment income for the years ended Dec. 31 is summarized as follows:

                                                1996                      1995
                                              --------                   -----
     Interest on fixed maturities            $  9,170                  $  7,561
     Interest on cash equivalents                 308                       157
     Other                                         16                        21
                                           ----------                        --
                                                9,494                     7,739
     Less investment expenses                     643                         5
                                           ----------                      ----
                                            $   8,851                  $  7,734
                                            =========                  ========
<PAGE>

     Securities  are rated by Moody's and  Standard & Poor's  (S&P),  except for
     approximately  $17.1  million  of  securities  which are rated by  American
     Express Financial Corporation's internal analysts using criteria similar to
     Moody's and S&P. A summary of investments in fixed maturities, at amortized
     cost, by rating on Dec. 31 is as follows:

            Rating                          1996                        1995
     ----------------------               ---------                   ------
     Aaa/AAA                              $ 60,374                    $ 42,939
     Aa/AA                                   4,648                       4,762
     Aa/A                                    1,469                       1,551
     A/A                                    26,768                      22,003
     A/BBB                                   4,988                       5,473
     Baa/BBB                                35,071                      23,747
     Baa/BB                                  6,977                       3,250
     Below investment grade                 13,915                       3,086
                                         ---------                 -----------
                                          $154,210                    $106,811
                                          ========                    ========

     At Dec. 31, 1996,  approximately 87 percent of the securities rated Aaa/AAA
     are GNMA,  FNMA and FHLMC  mortgage-backed  securities.  No holdings of any
     other issuer are greater than 10% of stockholder's equity. 

3.   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.

     The income tax expense consists of the following:

                                              1996                      1995
                                            --------                   -----
     Federal income taxes:
       Current                               $ (819)                   $1,495
       Deferred                               1,457                      (640)
                                              -----                    ------
                                                638                       855

     State income taxes-current                  40                        30
                                               ----                       ---
     Income tax expense                       $ 678                    $  885
                                              =====                    ======

     Increases  (decreases)  to the federal  income tax provision  applicable to
     pretax income based on the statutory rate are attributable to:

<TABLE>
<CAPTION>
                                                        1996                              1995
                                                    ------------                        --------
                                               Provision         Rate           Provision      Rate
     <S>                                           <C>          <C>                <C>         <C>  
     Federal income taxes based
       on the statutory rate                       $645         35.0%              $865        35.0%
     Increases (decreases) are attributable to :
         Other, net                                  (7)        (0.4)               (10)       (0.3)
                                                     --        -----                ---        ----
     Federal income taxes                          $638         34.6%              $855        34.7%
                                                   ====         ====               ====        ====
</TABLE>
<PAGE>

     Significant components of the Company's deferred tax assets and 
     liabilities as of Dec. 31 are as follows:

     Deferred tax assets:                           1996              1995
                                                    -----            -----
     Policy reserves                               $ 738             $1,073
     Deferred policy acquisition costs                --                116
     Other                                            --                142
                                                  ------            -------
          Total deferred tax assets                  738              1,331
                                                   -----             ------

     Deferred tax liabilities:
     Deferred policy acquisition costs               802                 --
     Investments                                     478              1,187
     Other                                            50                 --
                                                  ------              -----
          Total deferred tax liabilities           1,330              1,187
                                                  ------             ------
          Net deferred tax assets (liabilities)   $ (592)            $  144
                                                  ======             ======

     The Company is required to establish a valuation  allowance for any portion
     of the deferred tax assets that  management  believes will not be realized.
     In the opinion of  management,  it is more likely than not that the Company
     will realize the benefit of the deferred tax assets and, therefore, no such
     valuation allowance has been established.

4.   Stockholder's equity

     Retained earnings available for distribution as dividends to the parent are
     limited  to  the  Company's   surplus  as  determined  in  accordance  with
     accounting  practices  prescribed by the New York  Department of Insurance.
     All dividend  distributions  must be approved by the New York Department of
     Insurance.  Statutory unassigned surplus aggregated $7,220 and $7,671 as of
     Dec. 31, 1996 and 1995,  respectively  (see note 8 for a reconciliation  of
     net  income  and  stockholder's  equity  per  the  accompanying   financial
     statements to statutory net income and surplus).

5.   Related party transactions

     Until July 1, 1995, the Company  participated in the IDS Retirement Plan of
     American  Express   Financial   Corporation  which  covered  all  permanent
     employees  age 21 and over  who had met  certain  employment  requirements.
     Effective July 1, 1995,  the IDS  Retirement  Plan was merged with American
     Express Company's  American Express  Retirement Plan, which  simultaneously
     was amended to include a cash balance  formula and a lump sum  distribution
     option.  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 1996 and 1995.

     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.
     Costs of these plans  charged to  operations  in 1996 and 1995 were $19 and
     $13, respectively.

     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 its 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.
<PAGE>

     Charges  by IDS  Life  for  use of  joint  facilities  and  other  services
     aggregated  $3,142  and $105 for 1996 and 1995,  respectively.  Certain  of
     these costs are included in deferred policy acquisition costs.

6.   Commitments and contingencies

     At Dec. 31, 1996 and 1995,  traditional  life insurance in force aggregated
     $242,209 and $265,799,  respectively,  of which  $241,974 and $265,564 were
     reinsured at the respective year ends.  Under all  reinsurance  agreements,
     premiums ceded to reinsurers  amounted to $1,351 and $1,384 and reinsurance
     recovered from  reinsurers  amounted to $2,027 and $929 for the years ended
     Dec. 31, 1996 and 1995.

     The  economy  and other  factors  have  caused an increase in the number of
     insurance   companies   that  are  under   regulatory   supervision.   This
     circumstance  has resulted in  substantial  assessments  by state  guaranty
     associations to cover losses to policyholders of insolvent or rehabilitated
     companies.  The Company expects  additional future  assessments  related to
     past insolvencies and rehabilitations.  Management has estimated the impact
     of future  assessments on the Company's  financial  position and recorded a
     reserve for such future assessments.

     Reinsurance   contracts  do  not  relieve  the  Company  from  its  primary
     obligations to policyholders.

7.   Fair values of financial instruments

     The Company  discloses fair value  information for most on- and off-balance
     sheet  financial  instruments  for which it is practicable 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>

                                                            1996                               1995
                                                            -------                         -------
                                                    Carrying       Fair                Carrying          Fair
     Financial Assets                                 Value        Value                  Value         Value
     ----------------                                -------       --------              -------       ------
     <S>                                           <C>           <C>                  <C>             <C>       
     Investments in fixed maturities (Note 2)
       Held to maturity                            $  19,579     $  19,958            $   23,222      $   24,191
       Available for sale                            136,091       136,091                86,980          86,980
     Cash and cash equivalents (Note 1)               13,856        13,856                 2,531           2,531

     Financial Liabilities
     Future policy benefits for fixed
       annuities                                     139,352       136,332                92,704          90,975
</TABLE>

     At Dec.  31, 1996 and 1995,  the  carrying  amount and fair value of future
     policy  benefits  for  fixed  annuities   exclude  life   insurance-related
     contracts  carried  at $10 and $85,  respectively.  The fair value of these
     benefits is based on the status of the annuities at Dec. 31, 1996 and 1995.
     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 1996 and
     1995.
<PAGE>

8.   Statutory insurance accounting practices

     Reconciliations of net income for 1996 and 1995 and stockholder's equity at
     Dec. 31, 1996 and 1995, as shown in the accompanying  financial statements,
     to that determined using statutory accounting practices are as follows:

                                                            1996         1995
                                                          --------     ------
     Net income, per accompanying
         financial statements                             $ 1,165      $ 1,586
     Deferred policy acquisition costs                     (3,177)         252
     Adjustments of future policy
         benefit liabilities                                  (57)        (356)
     Deferred federal income taxes                          1,457         (640)
     Provision for losses on investments                       --          (12)
     IMR gain/loss transfer and amortization                   47          (46)
     Provision for other losses                                --         (837)
     Prior period adjustment                                 (313)         328
     Other, net                                                16          (27)
                                                         --------     --------
     Net income (loss), on basis of
         statutory accounting practices                   $  (862)     $   248
                                                          =======      =======


     Stockholder's equity, per accompanying
         financial statements                             $31,074      $21,250
     Deferred policy acquisition costs                     (4,364)      (1,318)
     Adjustments of future policy benefit liabilities       3,145          474
      Adjustments of reinsurance ceded reserves            (2,728)          --
     Deferred federal income taxes                            592         (100)
     Asset valuation reserve                               (1,287)        (869)
     Net unrealized gain on investments                    (1,460)      (3,390)
     Interest maintenance reserve                             (62)        (110)
     Provision for other losses                                --         (837)
     Other, net                                               (90)         171
                                                        ---------    ---------
     Stockholder's equity on basis of statutory
         accounting practices                             $24,820      $15,271
                                                          =======      =======

<PAGE>

Report of Independent Auditors

The Board of Directors
American Centurion Life Assurance Company


We have  audited the  accompanying  balance  sheets of American  Centurion  Life
Assurance  Company (a wholly owned subsidiary of IDS Life Insurance  Company) as
of December  31, 1996 and 1995,  and the related  statements  of income 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.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  financial  position  of American  Centurion  Life
Assurance  Company  at  December  31,  1996 and  1995,  and the  results  of its
operations  and its cash  flows for the years then  ended,  in  conformity  with
generally accepted accounting principles.



Ernst & Young, LLP
February 7, 1997
Minneapolis, Minnesota

<PAGE>


STATEMENT OF DIFFERENCES

Difference                          Description



1)  Prospectus and SAI date.        1)  The effective date of October 29, 1997,
                                        has been added to the prospectus and
                                        statement of additional information.

2)  "Performance Information"       2)  The second paragraph under the
    in the prospectus.                  Performance Information section has been
                                        changed.

3)  "Buying your annuity" in        3)  A deletion of the words "and accept" was
    the prospectus.                     made in the paragraph stating, "If your
                                        application is complete,......"

4)  "Making the most of your        4)  In the "Automated dollar-cost
    annuity" in the SAI.                averaging*" paragraph, the last
                                        sentence was added.

5)  "Performance Information"       5)  The Performance Information paragraph
    in the SAI.                         has been changed.



© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission