PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2, S-6EL24/A, 1997-04-29

PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2
S-6EL24/A, 1997-04-29

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AS FILED WITH THE SEC ON __________. REGISTRATION NO. 333-01031

================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

------------

FORM S-6

PRE-EFFECTIVE AMENDMENT NO. 3

FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933
OF SECURITIES OF UNIT INVESTMENT TRUSTS REGISTERED
ON FORM N-8B-2

------------

THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2
---------------------------------------------
(Exact Name of Trust)

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
-------------------------------------------
(Name of Depositor)

PRUDENTIAL PLAZA
NEWARK, NEW JERSEY 07102-3777
(201) 802-6000
-------------------------------------------------------------
(Address and telephone number of principal executive offices)

------------

C. CHRISTOPHER SPRAGUE
ASSISTANT GENERAL COUNSEL
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
213 WASHINGTON STREET
NEWARK, NEW JERSEY 07102-2992
-------------------------------------------
(Name and address of agent for service)

------------

Group Variable Universal Life Insurance Certificates. The Registrant hereby
elects to register an indefinite amount of securities pursuant to Rule 24f-2
under the Investment Company Act of 1940. The required fee of $500 was submitted
with the initial filing of this registration statement.

Approximate date of proposed public offering: as soon as practicable after the
effective date of the Registration Statement.

------------

This filing is being made pursuant to Rules 6c-3 and 6e-3(T) under the
Investment Company Act of 1940.

================================================================================

<PAGE>

CROSS REFERENCE SHEET
[AS REQUIRED BY FORM N-8B-2]

N-8B-2 ITEM NUMBER LOCATION
- ------------------ --------
1. Cover Page

2. Cover Page

3. Not Applicable

4. Sale of the Contract and Sales Commissions

5. The Prudential Variable Contract Account GI-2

6. The Prudential Variable Contract Account GI-2

7. Not Applicable

8. Not Applicable

9. Litigation

10. Brief Description of the Group Contract and Certificates;
Issuance of a Certificate; Applicant Owner Provision;
Short-Term Cancellation or "Free Look"; Procedures;
Premiums; Effective Date of Insurance; Allocation of
Premiums; Transfers; Dollar Cost Averaging; Death
Benefits; Changes in Face Amount; Charges and Expenses;
Reduction of Charges; Dividends/Experience Credits; Cash
Surrender Value; Full Surrenders; Election of Paid-Up
Insurance; Partial Withdrawals; Loans; Certificate
Exchange Privilege; Telephone and Electronic
Transactions; Lapse; Termination of the Contractholder's
Participation in Group Contracts; Participants Who Are No
Longer Eligible Group Members; Options on Termination of
Coverage; Reinstatement; Tax Treatment of Certificate
Benefits; ERISA considerations; When Proceeds are Paid;
Beneficiary; Incontestability; Misstatement of Age;
Suicide Exclusion; Assignment; Voting Rights;
Substitution of Fund Shares; Additional Insurance
Benefits

11. Brief Description of the Group Contract and Certificate;
The Prudential Variable Contract Account GI-2; The Funds.

12. Cover Page; Brief Description of the Group Contract
and Certificate; The Funds; Sale of the Contract and
Sales Commissions

13. Brief Description of the Group Contract and Certificate;
Premiums; Reduction of Charges; Sale of the Contract
and Sales Commissions

14. Brief Description of the Group Contract and Certificate;
Issuance of a Certificate; Procedures

15. Brief Description of the Group Contract and Certificate;
Procedures; Allocation of Premiums; Transfers

16. Brief Description of the Group Contract and Certificate;
Detailed Information About the Variable Universal Life
Insurance Certificates

17. Death Benefits; Full Surrenders; Partial Withdrawals;
Loans; When Proceeds are Paid

<PAGE>

N-8B-2 ITEM NUMBER LOCATION
- ------------------ --------
18. The Prudential Variable Contract Account GI-2; The Funds

19. Reports

20. Not Applicable

21. Loans

22. Not Applicable

23. Not Applicable

24. Incontestability; Misstatement of Age; Suicide Exclusion;
Assignment

25. The Prudential Insurance Company of America

26. The Funds; Charges and Expenses

27. General Information About The Prudential; The Prudential
Variable Contract Account GI-2 and the Variable
Investments Under the Certificates

28. The Prudential Insurance Company of America; Directors
and Officers

29. The Prudential Insurance Company of America

30. Not Applicable

31. Not Applicable

32. Not Applicable

33. Not Applicable

34. Not Applicable

35. The Prudential Insurance Company of America

36. Not Applicable

37. Not Applicable

38. Sale of the Contract and Sales Commissions

39. Sale of the Contract and Sales Commissions

40. Not Applicable

41. Sale of the Contract and Sales Commissions

42. Not Applicable

43. Not Applicable

44. Brief Description of the Group Contract and Certificate;
The Funds; Premiums; Cash Surrender Value

45. Not Applicable

46. Brief Description of the Group Contract and Certificate;
The Prudential Variable Contract Account GI-2; The
Funds; Death Benefits; Full Surrenders; Partial
Withdrawals

47. The Prudential Variable Contract Account GI-2; The
Funds

48. Not Applicable

49. Not Applicable

<PAGE>

N-8B-2 ITEM NUMBER LOCATION
- ------------------ --------
50. Not Applicable

51. Brief Description of the Group Contract and
Certificates; Detailed Information About the Variable
Universal Life Insurance Certificates

52. Substitution of Fund Shares

53. Tax Treatment of Certificate Benefits; ERISA
considerations

54. Not Applicable

55. Not Applicable

56. Not Applicable

57. Not Applicable

58. Not Applicable

59. Financial Statements; Statutory Financial Statements
of The Prudential Insurance Company of America

<PAGE>

PART I

INFORMATION IN PROSPECTUS

<PAGE>

PROSPECTUS

_____________, 1997

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2

GROUP VARIABLE UNIVERSAL LIFE
INSURANCE CONTRACTS

This prospectus describes Group Variable Universal Life insurance contracts
offered by The Prudential Insurance Company of America ("Prudential") which are
designed for use in group-sponsored insurance programs.

Each Eligible Group Member or "eligible applicant owner" (as defined in this
prospectus) who elects to obtain coverage under the Group Contract
("Participant") will receive a Certificate describing the coverage. Certain
Group Contracts may also permit a Participant to apply for separate insurance
coverage for his or her dependents.

The Group Contracts and Certificates provide life insurance protection with
flexible premium payments and a choice of underlying investment options. The
Death Benefit and Cash Surrender Value of a Certificate will vary daily with the
performance of the investment options selected, but the Death Benefit will not
be less than the Face Amount of the Certificate. Subject to certain requirements
and limitations, surrenders, partial withdrawals and loans are available.

The Prudential Variable Contract Account GI-2 (the "Separate Account") is
composed of 114 variable investment options (each, a "Subaccount"). The assets
of each Subaccount will be invested in a corresponding portfolio of The
Prudential Series Fund, Inc. (the "Series Fund") or certain other mutual fund
portfolios available to insurance company separate accounts (collectively, the
"Funds"). A Contractholder will be permitted to choose up to 20 of such Funds,
one of which must be a money market fund. Once that choice is made, the
Contractholder's Participants will then be allowed to direct premium payments
only to the Subaccounts corresponding to the selected Funds or to the Fixed
Account, an investment option under which Prudential guarantees an effective
annual interest rate of at least 4%.

The Funds in which the Separate Account invests are briefly described under THE
FUNDS, beginning on page 6. The investment objectives and policies of each Fund,
and the risks of investing in the Fund, are described in each Fund's prospectus
and statement of additional information. This prospectus is accompanied by
current prospectuses for each of the Funds that the Contractholder has chosen on
behalf of its Participants.

THE REPLACEMENT OF LIFE INSURANCE IS GENERALLY NOT IN THE INTEREST OF THE
CUSTOMER. IN MOST CASES, WHEN A CUSTOMER REQUIRES ADDITIONAL COVERAGE,
SUPPLEMENTING THE EXISTING POLICY BY PURCHASING ADDITIONAL INSURANCE OR A NEW
POLICY SHOULD BE REQUESTED, THEREBY PROTECTING THE BENEFITS OF THE ORIGINAL
POLICY, IF YOU ARE CONSIDERING REPLACING A POLICY, YOU SHOULD COMPARE THE
BENEFITS AND COSTS OF SUPPLEMENTING YOUR EXISTING POLICY WITH THE BENEFITS AND
COSTS OF PURCHASING THE CERTIFICATE DESCRIBED IN THIS PROSPECTUS AND YOU SHOULD
CONSULT WITH A QUALIFIED TAX ADVISOR.

PLEASE READ THIS PROSPECTUS AND KEEP IT FOR FUTURE REFERENCE. IT IS ACCOMPANIED
BY CURRENT PROSPECTUSES FOR EACH OF THE FUNDS THAT YOUR GROUP CONTRACTHOLDER HAS
MADE AVAILABLE TO YOU. EACH OF THESE PROSPECTUSES SHOULD BE READ CAREFULLY AND
RETAINED FOR FUTURE REFERENCE.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
PRUDENTIAL PLAZA
NEWARK, NEW JERSEY 07102-3777
TELEPHONE (201) 716-8721

Form #_______ Ed. __-97
Catalog No. __________

<PAGE>

TABLE OF CONTENTS

PAGE
----
<S> <C>
BRIEF DESCRIPTION OF THE GROUP CONTRACT AND CERTIFICATES............................................ 1

HYPOTHETICAL ILLUSTRATIONS OF DEATH BENEFITS AND CASH SURRENDER VALUES.............................. 4

GENERAL INFORMATION ABOUT PRUDENTIAL, THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2, AND
THE VARIABLE INVESTMENT OPTIONS AVAILABLE UNDER THE CERTIFICATES............................... 6
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA.................................................... 6
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2.................................................. 6
THE FUNDS ..................................................................................... 6
THE FIXED ACCOUNT.............................................................................. 22

DETAILED INFORMATION ABOUT THE CERTIFICATES......................................................... 23
ISSUANCE OF A CERTIFICATE...................................................................... 23
APPLICANT OWNER PROVISION...................................................................... 23
SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"................................................... 23
PROCEDURES..................................................................................... 23
PREMIUMS ..................................................................................... 24
EFFECTIVE DATE OF INSURANCE.................................................................... 24
ALLOCATION OF PREMIUMS......................................................................... 24
TRANSFERS ..................................................................................... 25
DOLLAR COST AVERAGING.......................................................................... 25
DEATH BENEFITS................................................................................. 26
CHANGES IN FACE AMOUNT......................................................................... 28
CHARGES AND EXPENSES........................................................................... 28
REDUCTION OF CHARGES........................................................................... 30
DIVIDENDS/EXPERIENCE CREDITS................................................................... 30
CASH SURRENDER VALUE........................................................................... 30
FULL SURRENDERS................................................................................ 31
ELECTION OF PAID-UP INSURANCE.................................................................. 31
PARTIAL WITHDRAWALS............................................................................ 31
LOANS.......................................................................................... 31
CERTIFICATE EXCHANGE PRIVILEGE................................................................. 32
TELEPHONE AND ELECTRONIC TRANSACTIONS.......................................................... 32
LAPSE ..................................................................................... 33
TERMINATION OF A CONTRACTHOLDER'S PARTICIPATION IN GROUP CONTRACTS............................. 33
PARTICIPANTS WHO ARE NO LONGER ELIGIBLE GROUP MEMBERS.......................................... 33
OPTIONS ON TERMINATION OF COVERAGE............................................................. 33
REINSTATEMENT.................................................................................. 34
TAX TREATMENT OF CERTIFICATE BENEFITS.......................................................... 35
ERISA CONSIDERATIONS........................................................................... 37
WHEN PROCEEDS ARE PAID......................................................................... 37
BENEFICIARY.................................................................................... 37
INCONTESTABILITY............................................................................... 38
MISSTATEMENT OF AGE............................................................................ 38
SUICIDE EXCLUSION.............................................................................. 38
ASSIGNMENT..................................................................................... 38
VOTING RIGHTS.................................................................................. 38
SUBSTITUTION OF FUND SHARES.................................................................... 39
ADDITIONAL INSURANCE BENEFITS.................................................................. 39
REPORTS ..................................................................................... 40
SALE OF THE CONTRACT AND SALES COMMISSIONS..................................................... 40
RATINGS AND ADVERTISEMENTS..................................................................... 41
PAYMENTS TO THIRD-PARTY ADMINISTRATORS AND ASSOCIATIONS SPONSORING PARTICIPATION
IN THE GROUP CONTRACTS...................................................................... 41
STATE REGULATION............................................................................... 41
EXPERTS........................................................................................ 41
LITIGATION..................................................................................... 42
ADDITIONAL INFORMATION......................................................................... 42

DEFINITIONS OF SPECIAL TERMS USED IN THIS PROSPECTUS................................................ 43

DIRECTORS AND OFFICERS OF PRUDENTIAL................................................................ 45

</TABLE>

<PAGE>

PAGE
----
<S> <C>

FINANCIAL STATEMENTS................................................................................ 47

STATUTORY FINANCIAL STATEMENTS OF THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA .................................................................................... A-1

</TABLE>

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS AND THE PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION FOR
EACH OF THE FUNDS.

<PAGE>

BRIEF DESCRIPTION OF THE GROUP CONTRACT
AND CERTIFICATES

The following section provides brief answers to some common questions about the
more significant features of the Contracts and Certificates. More detailed
information is provided in the subsequent sections of this prospectus and in the
Group Contract and Certificate themselves.

WHAT IS A GROUP VARIABLE UNIVERSAL LIFE INSURANCE CONTRACT?

It is an insurance contract issued by Prudential to an employer or other
sponsoring entity that sets forth the terms under which eligible members of the
group can obtain life insurance protection for themselves and, under some Group
Contracts, their dependents as well. Group members (or "eligible applicant
owners") who obtain such insurance ("Participants") receive a Certificate
describing their coverage. Certificates will provide for a Death Benefit and a
Cash Surrender Value. Both the Death Benefit and the Cash Surrender Value of a
Certificate will vary daily with the performance of the investment options
chosen by the Participant. Prudential will determine the share, if any, of its
divisible surplus allocable to a Group Contract as of each Contract Anniversary,
if the Group Contract stays in force by the payment of all required premiums to
that date.

HOW IS THE DEATH BENEFIT UNDER A CERTIFICATE COMPUTED?

A Participant will choose a Face Amount of insurance for his or her Certificate,
within certain limits. The Death Benefit will generally be that Face Amount plus
the value of the Participant's Certificate Fund as of the date of death. The
Certificate Fund initially consists of the Net Premiums invested in the
investment options chosen by the Participant. The value of the Certificate Fund
will vary daily to reflect the investment performance of the selected option(s)
and the deduction of charges by Prudential. Under certain circumstances, the
Death Benefit will be increased above the value of the Face Amount plus the
Certificate Fund to assure that the Certificate continues to meet the definition
of "life insurance" under the Internal Revenue Code. Any Death Benefit otherwise
payable will be reduced by any Certificate Debt and outstanding charges. See
DEATH BENEFITS, page 26.

HOW IS THE CASH SURRENDER VALUE OF A CERTIFICATE COMPUTED?

The Cash Surrender Value of a Certificate as of any date is equal to the value
of the Certificate Fund as of that date, reduced by any Certificate Debt,
outstanding charges, and under certain Group Contracts, a transaction charge of
up to $20. See CASH SURRENDER VALUE, page 30.

WHAT PREMIUMS MUST BE PAID?

A Participant generally has flexibility to select the frequency and amount of
premium payments, and the insurance will remain in force so long as the balance
in the Certificate Fund is sufficient to pay the monthly charges under the
Certificate. There may be an initial minimum premium required to enroll as a
Participant. If the balance in the Certificate Fund is not sufficient to pay any
month's charges, and the Participant fails to make premium payments sufficient
to bring the balance above this minimum amount during the grace period, the
Participant's insurance will lapse. See PREMIUMS, page 24.

Some Group Contracts may provide that if a Participant pays certain specified
premiums during the first two Certificate Years, the Certificate will not lapse
even if the Certificate Fund balance is insufficient to pay monthly charges. See
LAPSE, page 33.

WHAT INVESTMENT OPTIONS ARE AVAILABLE?

The Separate Account is composed of 114 Subaccounts, each of which invests in a
single corresponding Fund. Prudential permits a Contractholder to choose up to
20 Funds as investment options for such Contractholder's Participants, provided
that at least one of such Funds is a money market fund. In lieu of selecting
Funds itself, a Contractholder may ask Prudential to present it with one or more
predetermined groups of Funds in which the Contractholder's Participants would
invest. Whether the Contractholder selects Funds itself or from a predetermined
set presented by Prudential, the Contractholder will be prohibited from
substituting other Funds for any Funds that it has already selected. However, a
Contractholder that chooses fewer than 20 Funds initially will be permitted to
select additional Funds so long as the total number of Funds available to the
Participants does not exceed 20. Participants in a Contractholder's insurance
program will be allowed to allocate their premium payments only to the
Subaccounts that correspond to the Funds chosen by their Contractholder.
Participants may

<PAGE>

also allocate premium payments to the Fixed Account, an option under which
interest is credited at rates declared periodically by Prudential. See THE FIXED
ACCOUNT, page 22. For more information about the Funds and the different
investment objectives of all the Fund portfolios in which the Separate Account
invests, see THE FUNDS, page 6. More information about the Funds available to a
particular Contractholder is contained in the prospectuses for such Funds, which
will accompany the delivery of this prospectus.

Under the Certificate, Prudential will notify affected Participants concerning a
material change in a Fund's investment objective. As discussed more fully on
page 39 of this prospectus, Prudential may seek to substitute the shares of a
different mutual fund for shares of a Fund, and would notify Contractholders and
Participants of any such substitution. Changes that Prudential may make to the
Group Contracts or the Certificates are detailed in those documents.

DO CERTIFICATES PROVIDE PARTICIPANTS WITH CHOICE AND FLEXIBILITY IN ADDRESSING A
RANGE OF DIFFERENT INSURANCE PROTECTION AND INVESTMENT OBJECTIVES?

Yes. Because the Cash Surrender Value of a Participant's insurance will vary
with the investment experience of the investment options, a Certificate under
the Group Contract offers an opportunity for the Cash Surrender Value to
appreciate more than it would under comparable insurance without variable
investment options. It is also possible, however, for the Cash Surrender Value
to decrease in value if the investment experience of the selected investment
option(s) is unfavorable. The variable investment options vary in their risks,
and Participants can choose to direct the amounts in their Certificate Fund to
more aggressive or more conservative variable investment options as their
personal circumstances and investment objectives may dictate over time.

Participants who prefer to avoid or reduce the risks involved in any of the
variable options may elect to allocate all or a portion of Net Premiums to the
Fixed Account. Prudential guarantees that the part of the Certificate Fund
allocated to this option will accrue interest daily at a rate that Prudential
declares periodically. Although this rate will change from time to time, it may
not be less than an effective annual rate of 4%. See THE FIXED ACCOUNT, page 22.

In short, the Certificate's investment options and premium flexibility can be
used to meet the changing needs of Participants over time.

WHAT CHARGES ARE MADE?

Prudential deducts certain charges from each premium payment and from the
amounts held in the designated investment option(s). All of these charges, which
are designed to compensate Prudential for insurance costs and risks, as well as
cover Prudential's expenses, are fully described under CHARGES AND EXPENSES,
page 28. The following diagram briefly outlines the charges that may be made:

<PAGE>

---------------------------------------------------------------
PREMIUM PAYMENT
---------------------------------------------------------------

--------------------------------------------------------
o less the sum of a charge (currently 2.6%,
however, for certain Group Contracts, this
charge may equal up to 5.35%) for taxes
attributable to premium payments

o a processing fee of up to $2, which may be
reduced or waived under certain Group Contracts

o a sales charge of up to 3 1/2%, which may be
reduced or waived under certain Group Contracts
--------------------------------------------------------

- --------------------------------------------------------------------------------
NET PREMIUM AMOUNT

o To be invested in one or a combination of the investment portfolio options
available to the Participant.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
DAILY CHARGES

o A daily charge is deducted from the assets of the Subaccounts of the
Separate Account for mortality and expense risks. The current daily charge
is equivalent to an effective annual rate of 0.45%. The charge is
guaranteed not to exceed an effective annual rate of 0.90%.

o Investment management fees and expenses are deducted from the assets of the
Funds. In 1996, the total expenses (after expense reimbursement) of the
Funds ranged from 0.40% to 2.57% of their average net assets.
See page 8.

- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
MONTHLY CHARGES

o An administrative expense charge may be deducted each month from the
Certificate Fund. The charge is currently up to $3 per month and is
guaranteed not to exceed $6 per month.

o A charge for the cost of insurance is deducted from the Certificate Fund.

o Charges for any additional insurance benefits not already taken into
account in the cost of insurance charge are deducted from the Certificate
Fund.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
POSSIBLE ADDITIONAL CHARGES

o Under certain Group Contracts, a transaction charge of up to the lesser of
$20 or 2% of the amount surrendered or withdrawn will be assessed under
each surrender or partial withdrawal.

o Under certain Group Contracts, a transaction charge of up to $20 may be
made in connection with each loan or additional statement request.

o No transaction charge is currently assessed in connection with transfers,
but certain Group Contracts may give Prudential the right to assess a
charge of up to $20 for each transfer after the twelfth with respect to the
same Certificate in the same Certificate Year.

o No charge is currently made for any other taxes imposed upon the operations
of the Separate Account, but Prudential reserves the right to impose such a
charge.
- --------------------------------------------------------------------------------

WHAT WITHDRAWAL OR LOAN RIGHTS DO PARTICIPANTS HAVE?

At any time while a Certificate is in effect, a Participant may elect to
surrender his or her insurance and receive its Cash Surrender Value. A
Participant may also request a partial withdrawal from the Certificate Fund. See
FULL SURRENDERS, page 31, and PARTIAL WITHDRAWALS, page 31.

A Participant may borrow (before any applicable transaction charge) a total
amount up to the Loan Value of his or her Certificate. The Loan Value of a
Certificate at any time is determined by multiplying the Certificate Fund by 90%
(or higher where required by state law) and then subtracting any existing loan
with accrued interest, outstanding charges, and the amount of the next month's
charges. When a loan is taken, an amount equal to the loan is transferred from
the investment options to a Loan Account that remains part of the Certificate
Fund. This Loan Account earns interest at an effective annual rate that is
generally 2% less than the interest charged on the loan. Any outstanding
Certificate Debt will be deducted from proceeds payable at the Covered Person's
death or upon surrender. See LOANS, page 31.

<PAGE>

HOW IS A PARTICIPANT'S INSURANCE AFFECTED IF HE OR SHE IS NO LONGER A MEMBER OF
THE GROUP?

Depending on the terms of the particular Group Contract, a Participant who is no
longer included in the group of eligible members may be able to elect to
continue the insurance provided by the Group Contract on a Portable basis.
Certificates continued on a Portable basis may be subject to higher charges. A
Participant may also surrender the insurance for its Cash Surrender Value, elect
to use the Cash Surrender Value of the insurance to purchase paid-up insurance,
or convert the insurance to an individual life insurance policy. See OPTIONS ON
TERMINATION OF COVERAGE, page 33.

WHAT IS THE FEDERAL INCOME TAX STATUS OF AMOUNTS RECEIVED UNDER A CERTIFICATE?

Variable life insurance contracts, such as those offered by this Prospectus,
receive the same federal income taxation treatment as conventional fixed benefit
life insurance. This means, first, that any Death Benefit paid would generally
be excluded from the gross income of the beneficiary. Second, any annual
increases in the value of the Certificate Fund, whether from income or capital
appreciation, would not be included in the taxable income of a Participant.
Third, assuming that premiums are not paid above levels that would make a
Certificate a "Modified Endowment Contract" as defined in the Internal Revenue
Code, pre-death distributions, whether in the form of surrenders or partial
withdrawals, would be treated first as a return of the Participant's investment
in the Certificate and then as a distribution of taxable income, and loans would
not be treated as distributions at the time the loan was made. See TAX TREATMENT
OF CERTIFICATE BENEFITS, page 35.

HYPOTHETICAL ILLUSTRATIONS OF
DEATH BENEFITS AND CASH SURRENDER VALUES

The two illustrations that follow show how the Death Benefit and Cash Surrender
Value change with the investment experience of the Separate Account. They are
not projections of values; they are intended to show how a Certificate works.
They are "hypothetical" because they are based upon several assumptions, as
described below. Both illustrations assume that a Certificate with a Face Amount
of $100,000 has been bought by a 40-year old Covered Person. The illustrations
assume that a premium of $1,200 is paid at issuance and annually on each
Certificate Anniversary.

The first illustration assumes that a 2.6% charge is deducted for charges
attributable to premiums and that current sales, cost of insurance, mortality
and expense risk and administrative charges and processing fee will continue for
the indefinite future. It assumes that the Covered Person is in a risk class
that has current standardized cost of insurance charges equal to rates equal to
Table I under Section 79 of the Internal Revenue Code. It assumes a monthly
administrative charge of $3, which applies to Certificates that do not involve
any direct billing by Prudential. See ADMINISTRATIVE CHARGE, page 29.

The second illustration is based upon the same assumptions except it is assumed
that the maximum amount for taxes attributable to premiums, sales, cost of
insurance, mortality and expense risk and administrative charges and processing
fee permitted by the particular Certificate have been made throughout the life
of the Certificate. It assumes that the Covered Person is in a risk class that
has maximum guaranteed cost of insurance charges equal to the maximum rates that
could be charged, which are 150% of the 1980 Commissioner's Standard Ordinary
Mortality Table (Male), Age Last Birthday (the "1980 CSO Table").

Although Prudential may under some Group Contracts pay Dividends or Experience
Credits to Contractholders, who may distribute those Dividends/Experience
Credits to Participants in the Group Contract, neither table reflects Dividends
or Experience Credits. See DIVIDENDS/EXPERIENCE CREDITS, page 30.

Another assumption is that the Certificate Fund has been invested in equal
amounts in each of the 114 Funds. Finally, there are four assumptions, shown
separately, about the average investment performance of the portfolios. The
first is that there will be a uniform zero percent gross rate of return, that
is, that the average value of the Certificate Fund will uniformly be adversely
affected by very unfavorable investment performance. The other three assumptions
are that investment performance will be at a uniform gross annual rate of 4%, 8%
and 12%. These, of course, are merely assumptions, and actual returns will
fluctuate from year to year. Nevertheless, these tables help show how the Cash
Surrender Value and the Death Benefit change with investment experience.

<PAGE>

The first column in the following illustrations shows the contract year. The
second column, to provide context, shows what the aggregate amount would be if
the assumed premiums had been invested in a savings account paying a 4%
effective annual rate. Of course, if that were done, there would be no life
insurance protection. The next four columns show the Death Benefit payable in
each of the years shown for the four different assumed investment returns. Note
that a gross return (as well as the net return) is shown at the top of each
column. The gross return represents the combined effect of income and capital
appreciation of the portfolios before any reduction is made for investment
management fees or other Fund expenses. The net return reflects an average total
annual expense ratio of the 114 Funds of 0.92%, and the daily deduction from the
Certificate Fund of 0.45% per year for the first table, which is based on
current charges, and 0.90% for the second table, which is based on maximum
charges. Thus, assuming maximum charges, gross returns of 0%, 4%, 8% and 12% are
the equivalent of net returns of -1.82%, 2.18%, 6.18%, and 10.18% respectively.
The Death Benefits and Cash Surrender Values shown reflect the deduction of all
expenses and charges both for the Subaccounts and under the Certificate.

The amounts shown assume that there is no loan or partial withdrawal.

Upon request, Prudential will provide comparable hypothetical illustrations for
a Certificate reflecting the proposed Covered Person's age, risk class, proposed
Face Amount of insurance, and proposed premium payments.

<PAGE>

ILLUSTRATIONS

GROUP VARIABLE UNIVERSAL LIFE INSURANCE CERTIFICATE
SPECIFIED FACE AMOUNT: $100,000
ISSUE AGE 40
ASSUME PAYMENT OF $1,200 ANNUAL PREMIUMS FOR ALL YEARS
USING CURRENT CHARGES
<TABLE>
<CAPTION>

Death Benefit (1)
-----------------------------------------------------------------------
Assuming Hypothetical Gross (and Net)
Annual Investment Return of
End of Premiums -----------------------------------------------------------------------
Certificate Accumulated 0% Gross 4% Gross 8% Gross 12% Gross
Year at 4% per year (-1.37% Net) (2.63% Net) (6.63% Net) (10.63% Net)
----------- -------------- --------------- ------------ ----------- --------------
<S> <C> <C> <C> <C> <C>

1 $ 1,248 $100,915 $100,956 $100,998 $101,039
2 2,546 101,817 101,937 102,062 102,189
3 3,896 102,706 102,944 103,196 103,461
4 5,300 103,584 103,978 104,406 104,869
5 6,760 104,449 105,039 105,695 106,426
6 8,278 105,160 105,981 106,922 107,996
7 9,857 105,861 106,948 108,229 109,733
8 11,499 106,552 107,941 109,623 111,655
9 13,207 107,234 108,960 111,110 113,781
10 14,984 107,906 110,006 112,695 116,133
15 24,989 110,032 114,442 120,995 130,729
20 37,163 110,451 117,762 130,520 152,798
25 51,974 108,408 118,847 140,670 186,077
30 69,994 0(2) 114,118 148,064 233,932
35 91,918 0 0(2) 146,480 300,217
40 118,592 0 0 144,297 410,057

</TABLE>

Cash Surrender Value (1)
------------------------------------------------------------------
Assuming Hypothetical Gross (and Net)
Annual Investment Return of
End of ------------------------------------------------------------------
Certifica 0% Gross 4% Gross 8% Gross 12% Gross
Year (-1.37% Net) (2.63% Net) (6.63% Net) (10.63% Net)
- --------- ------------ ----------- ----------- ------------
1 $ 915 $ 956 $ 998 $ 1,039
2 1,817 1,937 2,062 2,189
3 2,706 2,944 3,196 3,461
4 3,584 3,978 4,406 4,869
5 4,449 5,039 5,695 6,426
6 5,160 5,981 6,922 7,996
7 5,861 6,948 8,229 9,733
8 6,552 7,941 9,623 11,655
9 7,234 8,960 11,110 13,781
10 7,906 10,006 12,695 16,133
15 10,032 14,442 20,995 30,729
20 10,451 17,762 30,520 52,798
25 8,408 18,847 40,670 86,077
30 0(2) 14,118 48,064 133,932
35 0 0(2) 46,480 200,217
40 0 0 44,297 310,057

(1) Assumes no loan or partial withdrawal has been made.

(2) Zero value in cash value and death benefit indicates lapse of insurance
coverage in the absence of a sufficient additional premium payment.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF RETURN MAY BE MORE OR
LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS INCLUDING THE
INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING INTEREST RATES, FEDERAL AND
STATE INCOME TAXES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CERTIFICATE WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATE
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS, BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CERTIFICATE YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUDENTIAL OR THE FUNDS THAT THESE HYPOTHETICAL
RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR OVER ANY PERIOD OF TIME.

<PAGE>

ILLUSTRATIONS

GROUP VARIABLE UNIVERSAL LIFE INSURANCE CERTIFICATE
SPECIFIED FACE AMOUNT: $100,000
ISSUE AGE 40
ASSUME PAYMENT OF $1,200 ANNUAL PREMIUMS FOR ALL YEARS
USING MAXIMUM CONTRACTUAL CHARS
<TABLE>
<CAPTION>

Death Benefit (1)
------------------------------------------------------------------------
Assuming Hypothetical Gross (and Net)
Annual Investment Return of
End of Premiums ------------------------------------------------------------------------
Certificate Accumulated 0% Gross 4% Gross 8% Gross 12% Gross
Year at 4% per year (-1.82% Net) (2.18% Net) (6.18% Net) (10.18% Net)
----------- -------------- ------------ ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
1 $1,248 $100,532 $100,564 $100,596 $100,628
2 2,546 101,014 101,099 101,187 101,277
3 3,896 101,445 101,602 101,769 101,947
4 5,300 101,821 102,068 102,339 102,635
5 6,760 102,139 102,493 102,891 103,339
6 8,278 102,398 102,871 103,421 104,057
7 9,857 102,594 103,200 103,924 104,788
8 11,499 102,726 103,473 104,394 105,527
9 13,207 102,790 103,685 104,825 106,272
10 14,984 102,781 103,827 105,207 107,016
15 24,989 101,310 103,059 105,859 110,276
20 37,163 0 (2) 0 (2) 102,664 111,091
25 51,974 0 0 0 (2) 105,565
30 69,994 0 0 0 0 (2)
35 91,918 0 0 0 0
40 118,592 0 0 0 0

</TABLE>

Cash Surrender Value (1)
------------------------------------------------------------------------
Assuming Hypothetical Gross (and Net)
Annual Investment Return of
End of ------------------------------------------------------------------------
Certificate 0% Gross 4% Gross 8% Gross 12% Gross
Year (-1.82% Net) (2.18% Net) (6.18% Net) (10.18% Net)
----------- ------------ ----------- ---------- ------------
<S> <C> <C> <C> <C>

1 $ 512 $ 544 $ 576 $ 608
2 994 1,079 1,167 1,257
3 1,425 1,582 1,749 1,927
4 1,801 2,048 2,319 2,615
5 2,119 2,473 2,871 3,319
6 2,378 2,851 3,401 4,037
7 2,574 3,180 3,904 4,768
8 2,706 3,453 4,374 5,507
9 2,770 3,665 4,805 6,252
10 2,761 3,807 5,187 6,996
15 1,290 3,039 5,839 10,256
20 0 (2) 0 (2) 2,644 11,071
25 0 0 0 (2) 5,545
30 0 0 0 0 (2)
35 0 0 0 0
40 0 0 0 0

</TABLE>

(1) Assumes no loan or partial withdrawal has been made.

(2) Zero value in cash value and death benefit indicates lapse of insurance
coverage in the absence of a sufficient additional premium payment.

FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CERTIFICATE YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUDENTIAL OR THE FUNDS THAT THESE HYPOTHETICAL
RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR OVER ANY PERIOD OF TIME.

<PAGE>

GENERAL INFORMATION ABOUT PRUDENTIAL, THE
PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2, AND THE
VARIABLE INVESTMENT OPTIONS AVAILABLE UNDER THE
CERTIFICATES

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

The Prudential Insurance Company of America ("Prudential") is a mutual insurance
company, founded in 1875 under the laws of the State of New Jersey. It is
licensed to sell life insurance and annuities in all states, in the District of
Columbia, and in all United States territories and possessions. Prudential's
statutory financial statements begin on page A-1 and should be considered only
as bearing upon Prudential's ability to meet its obligations under the Group
Contracts and the insurance provided thereunder. Prudential and its affiliates
act in a variety of capacities with respect to registered investment companies
including as depositor, advisor, and principal underwriter.

THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2

The Prudential Variable Contract Account GI-2 (the "Separate Account") was
established on June 14, 1988 under New Jersey law as a separate investment
account. The Separate Account meets the definition of a "separate account" under
the federal securities laws. The Separate Account holds assets that are
segregated from all of Prudential's other assets.

The obligations arising under the Group Contracts and the Certificates are
general corporate obligations of Prudential. Prudential is also the legal owner
of the assets in the Separate Account. Prudential will maintain assets in the
Separate Account with a total market value at least equal to the liabilities
relating to the benefits attributable to the Separate Account. These assets may
not be charged with liabilities which arise from any other business Prudential
conducts. In addition to these assets, the Separate Account's assets may include
funds contributed by Prudential to commence operation of the Separate Account
and may include accumulations of the charges Prudential makes against the
Separate Account. From time to time, these additional assets will be transferred
to Prudential's general account. Before making any such transfer, Prudential
will consider any possible adverse impact the transfer might have on the
Separate Account.

The Separate Account is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940 ("1940 Act") as a unit
investment trust, which is a type of investment company. This does not involve
any supervision by the SEC of the management or investment policies or practices
of the Separate Account. For state law purposes, the Separate Account is treated
as a part or division of Prudential. There are currently 114 Subaccounts within
the Separate Account, each of which invests in a single corresponding portfolio
of the Funds. Prudential reserves the right to take all actions in connection
with the operation of the Separate Account that are permitted by applicable law
(including those permitted upon regulatory approval).

THE FUNDS

Set out below is a list of each Fund, its investment objectives, investment
management fees and other expenses, and its investment adviser. For certain of
the Funds, policy information in addition to the Fund's fundamental investment
objective is provided.

THE PRUDENTIAL SERIES FUND, INC.

The twelve portfolios of the Series Fund in which the Separate Account may
currently invest and their investment objectives and fees are as follows:

MONEY MARKET PORTFOLIO: The maximum current income that is consistent with
stability of capital and maintenance of liquidity through investment in
high-quality short-term debt obligations.

DIVERSIFIED BOND PORTFOLIO: A high level of income over the longer term while
providing reasonable safety of capital through investment primarily in readily
marketable intermediate and long-term fixed income securities that provide
attractive yields but do not involve substantial risk of loss of capital through
default.

GOVERNMENT INCOME PORTFOLIO: Achievement of a high level of income over the
longer term consistent with the preservation of capital through investment
primarily in U.S. Government securities, including intermediate and long-

<PAGE>

term U.S. Treasury securities and debt obligations issued by agencies of or
instrumentalities established, sponsored or guaranteed by the U.S. Government.
At least 65% of the total assets of the portfolio will be invested in U.S.

Government securities.

CONSERVATIVE BALANCED PORTFOLIO: Achievement of a favorable total investment
return consistent with a portfolio having a conservatively managed mix of money
market instruments, fixed income securities, and common stocks, in proportions
believed by the investment manager to be appropriate for an investor desiring
diversification of investment who prefers a relatively lower risk of loss than
that associated with the Flexible Managed Portfolio while recognizing that this
reduces the chances of greater appreciation.

FLEXIBLE MANAGED PORTFOLIO: Achievement of a high total return consistent with a
portfolio having an aggressively managed mix of money market instruments, fixed
income securities, and common stocks, in proportions believed by the investment
manager to be appropriate for an investor desiring diversification of investment
who is willing to accept a relatively high level of loss in an effort to achieve
greater appreciation.

HIGH YIELD BOND PORTFOLIO: Achievement of a high total return through investment
in high yield/high risk fixed income securities in the medium to lower quality
ranges.

STOCK INDEX PORTFOLIO: Achievement of investment results that correspond to the
price and yield performance of publicly traded common stocks in the aggregate by
following a policy of attempting to duplicate the price and yield performance of
the Standard & Poor's 500 Composite Stock Price Index.

EQUITY INCOME PORTFOLIO: Both current income and capital appreciation through
investment primarily in common stocks and convertible securities that provide
favorable prospects for investment income returns above those of the Standard &
Poor's 500 Composite Stock Price Index or the New York Stock Exchange Composite
Index.

EQUITY PORTFOLIO: Capital appreciation through investment primarily in common
stocks of companies, including major established corporations as well as smaller
capitalization companies, that appear to offer attractive prospects of price
appreciation that are superior to broadly-based stock indices. Current income,
if any, is incidental.

PRUDENTIAL JENNISON PORTFOLIO: Long-term growth of capital through investment
primarily in equity securities of established companies with above-average
growth prospects. Current income, if any, is incidental.

SMALL CAPITALIZATION STOCK PORTFOLIO: Long-term growth of capital through
investment primarily in equity securities of publicly-traded companies with
small market capitalization. Current income, if any, is incidental.

GLOBAL PORTFOLIO: Long-term growth of capital through investment primarily in
common stock and common stock equivalents of foreign and domestic issuers.
Current income, if any, is incidental.

The other portfolios described in the accompanying Series Fund prospectus are
not available in connection with these Group Contracts.

Prudential is the investment adviser of each of the portfolios of the Series
Fund. Prudential's principal business address is Prudential Plaza, Newark, New
Jersey 07102-3777. Prudential has a service agreement with its wholly-owned
subsidiary The Prudential Investment Corporation ("PIC"), which provides that,
subject to Prudential's supervision, PIC will furnish investment advisory
services in connection with the management of the Series Fund. In addition,
Prudential has entered into a subadvisory agreement with its wholly-owned
subsidiary Jennison Associates Capital Corp. ("Jennison"), under which Jennison
furnishes investment advisory services in connection with the management of the
Prudential Jennison Portfolio. Further detail is provided in the prospectus and
statement of additional information for the Series Fund. Prudential, PIC and
Jennison are registered as investment advisers under the Investment Advisers Act
of 1940.

<PAGE>

- -------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
FUNDS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- --------------------------------------------------------------------------------
THE SERIES FUND
Money Market Portfolio (1) 0.40% 0.04% 0.44%
Diversified Bond Portfolio (1) 0.40% 0.05% 0.45%

Government Income Portfolio (1) 0.40% 0.06% 0.46%

Conservative Balanced Portfolio (1) 0.55% 0.04% 0.59%
Flexible Managed Portfolio (1) 0.60% 0.04% 0.64%
High Yield Bond Portfolio (1) 0.55% 0.08% 0.63%
Stock Index Portfolio (1) 0.35% 0.05% 0.40%
Equity Income Portfolio (1) 0.40% 0.05% 0.45%
Equity Portfolio (1) 0.45% 0.05% 0.50%
Prudential Jennison Portfolio (1) 0.60% 0.06% 0.66%

Small Capitalization Stock Portfolio (1) 0.40% 0.16% 0.56%

Global Portfolio (1) 0.75% 0.17% 0.92%

- --------------------------------------------------------------------------------

(1) SERIES FUND. With respect to the Series Fund portfolios, except for the
Global Portfolio, Prudential reimburses a portfolio when its ordinary
operating expenses, excluding taxes, interest, and brokerage commissions
exceed 0.75% of the portfolio's average daily net assets. The amounts
listed for the portfolios under other expenses are based on amounts
incurred in the last fiscal year.

AIM VARIABLE INSURANCE FUNDS, INC.

The portfolios of the AIM Variable Insurance Funds, Inc. in which the Separate
Account may currently invest and their investment objectives and fees are as
follows:

AIM V.I. CAPITAL APPRECIATION FUND: A diversified portfolio which seeks to
provide capital appreciation through investments in common stocks, with emphasis
on medium-sized and smaller emerging growth companies.

AIM V.I. GROWTH FUND: A diversified portfolio which seeks to provide growth of
capital through investments primarily in common stocks of leading U.S. companies
considered by AIM to have strong earnings momentum.

AIM V.I. GROWTH AND INCOME FUND: A diversified portfolio which seeks to provide
growth of capital, with current income as a secondary objective by investing
primarily in dividend paying common stocks which have prospects for both growth
of capital and dividend income.

AIM V.I. INTERNATIONAL EQUITY FUND: A diversified portfolio which seeks to
provide long-term growth of capital by investing in international equity
securities, the issuers of which are considered by AIM to have strong earnings
momentum.

AIM V.I. VALUE FUND: A diversified portfolio which seeks to achieve long-term
growth of capital by investing primarily in equity securities judged by AIM to
be undervalued relative to the current or projected earnings of the companies
issuing the securities, or relative to current market values of assets owned by
the companies issuing the securities or relative to the equity markets
generally. Income is a secondary objective.

AIM Advisors, Inc. ("AIM") serves as the investment advisor to each Fund. AIM's
principal business address is 11 Greenway Plaza, Suite 1919, Houston, Texas
77046-1173. The principal underwriter of the funds is AIM Distributors, a
subsidiary of AIM, located at 11 Greenway Plaza, Suite 1919, Houston, Texas
77046-1173.

<PAGE>

- --------------------------------------------------------------------------------
INVESTMENT
FUNDS MANAGEMENT OTHER TOTAL FUND
FEE EXPENSES ANNUAL EXPENSES
- --------------------------------------------------------------------------------
AIM VARIABLE INSURANCE FUNDS, INC.

AIM V.I. Capital Appreciation Fund 0.64% 0.09% 0.73%
AIM V.I. Growth Fund 0.65% 0.13% 0.78%
AIM V.I. Growth and Income Fund 0.65% 0.13% 0.78%
AIM V.I. International Equity Fund 0.75% 0.21% 0.96%
AIM V.I. Value Fund 0.64% 0.09% 0.73%

- --------------------------------------------------------------------------------

ALLIANCE CAPITAL

The portfolios of the Alliance Variable Products Series Fund, Inc. in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

GLOBAL DOLLAR GOVERNMENT PORTFOLIO: Seeks a high level of current income through
investing substantially all of its assets in U.S. and non-U.S. fixed-income
securities denominated only in U.S. dollars.

GROWTH PORTFOLIO: Seeks long-term growth of capital by investing primarily in
common stocks and other equity securities.

GROWTH AND INCOME PORTFOLIO: Seeks to balance the objectives of reasonable
current income and reasonable opportunities for appreciation through investments
primarily in dividend-paying common stocks of good quality.

INTERNATIONAL PORTFOLIO: Seeks to obtain a total return on its assets from
long-term growth of capital and from income principally through a broad
portfolio of marketable securities of established non-United States companies
(or United States companies having their principal activities and interests
outside the United States), companies participating in foreign economies with
prospects for growth, and foreign government securities.

PREMIER GROWTH PORTFOLIO: Seeks growth of capital rather than current income. In
pursuing its investment objective, the Premier Growth Portfolio will employ
aggressive investment policies. Since investments will be made based upon their
potential for capital appreciation, current income will be incidental to the
objective of capital growth. This portfolio is not intended for investors whose
principal objective is assured income or preservation of capital.

QUASAR PORTFOLIO: Seeks growth of capital by pursuing aggressive investment
policies. This portfolio invests in a diversified portfolio of equity securities
of any company and industry and in any type of security which is believed to
offer possibilities for capital appreciation.

TECHNOLOGY PORTFOLIO: Seeks growth of capital through investment in companies
expected to benefit from advances in technology. This portfolio will invest
principally in a diversified portfolio of securities of companies which use
technology extensively in the development of new or improved products or
processes.

Alliance Capital Management L.P. ("Alliance") is the investment adviser to each
of the above-mentioned funds. Alliance's principal business address is 1345
Avenue of the Americas, New York, New York 10105. The principal underwriter of
the funds is Alliance Fund Distributors, Inc., a subsidiary of Alliance, located
at 1345 Avenue of the Americas, New York, New York 10105.

<PAGE>

- --------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
FUNDS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- --------------------------------------------------------------------------------
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.

Global Dollar Government Portfolio (1) 0.00% 0.95% 0.95%
Growth Portfolio (1) 0.74% 0.19% 0.93%
Growth and Income Portfolio (1) 0.63% 0.19% 0.82%
International Portfolio (1) 0.04% 0.91% 0.95%
Premier Growth Portfolio (1) 0.72% 0.23% 0.95%
Quasar Portfolio (1)(3)(4) 0.00% 0.95% 0.95%
Technology Portfolio (1)(2)(4) 0.33% 0.62% 0.95%
- --------------------------------------------------------------------------------

(1) Net of expense reimbursement. The expenses of the following Portfolios,
before expense reimbursements, would be: Global Dollar Government
Portfolio: investment management fees 0.75%, other expenses 1.22% and total
fund annual expenses 1.97%; Growth Portfolio: investment management fees
0.74%, other expenses 0.19% and total fund annual expenses 0.93%; Growth
and Income Portfolio: investment management fees 0.63%, other expenses
0.19% and total fund annual expenses 0.82%; International Portfolio:
investment management fees 1.00%, other expenses 0.91% and total fund
annual expenses 1.91%; Premier Growth Portfolio: investment management fees
1.00%, other expenses 0.23% and total fund annual expenses 1.23%; Quasar
Portfolio: investment management fees 1.00%, other expenses 3.44% and total
fund annual expenses 4.44%; and the Technology Portfolio: investment
management fees 1.00%, other expenses 0.62% and total fund annual expenses
1.62%.

(2) For the period of 1/11/96 through 12/31/96.

(3) For the period of 8/5/96 through 12/31/96.

(4) Annualized.

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

The portfolios of American Century Variable Portfolios, Inc. in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

VP ADVANTAGE PORTFOLIO: The investment objective of the VP Advantage Portfolio
is current income and capital growth. As described more fully in the Portfolio's
prospectus, the Portfolio intends to invest in cash or cash equivalents, certain
fixed income securities, and certain equity securities.

VP BALANCED PORTFOLIO: The investment objective of the VP Balanced Portfolio is
capital growth and current income. Management of the Portfolio intends to
maintain approximately 60% of the Portfolio's assets in the equity securities
described in the prospectus, and intends to maintain approximately 40% of the
Portfolio's assets in fixed income securities (with a minimum of 25% of that
amount in fixed income senior securities).

VP CAPITAL APPRECIATION PORTFOLIO: Seeks capital growth over time by investing
primarily in common stocks that are considered by management to have
better-than-average prospects for appreciation.

VP INTERNATIONAL PORTFOLIO: Seeks capital growth over time by investing in
common stocks of foreign companies considered to have better-than-average
prospects for appreciation.

VP VALUE PORTFOLIO: Seeks long-term capital growth with income as a secondary
objective. The fund seeks to achieve its objectives by investing primarily in
equity securities of well-established companies with intermediate-to- large
market capitalizations that are believed by management to be undervalued at the
time of purchase.

The investment adviser for each fund is American Century Investment Management,
Inc. ("ACIM"). ACIM's principal business address is American Century Tower, 4500
Main Street, Kansas City, Missouri 64111. The principal underwriter of the funds
is American Century Services, Inc., located at 4500 Main Street, Kansas City,
Missouri 64111.

<PAGE>

- --------------------------------------------------------------------------------
FUNDS TOTAL FUND
ANNUAL EXPENSES
- --------------------------------------------------------------------------------

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.
VP Advantage Portfolio (1) 1.00%
VP Balanced Portfolio (1) 1.00%
VP Capital Appreciation Portfolio (1) 1.00%
VP International Portfolio (1) 1.50%
VP Value Portfolio (1) 1.00%
- --------------------------------------------------------------------------------

(1) Fees are all-inclusive.

THE BERGER FUNDS

The portfolios of the Berger Institutional Products Trust ("Berger IPT") in
which the Separate Account may currently invest and their investment objectives
and fees are as follows:

BERGER IPT - 100 FUND: The investment objective of the Berger IPT - 100 Fund is
long term capital appreciation. The Berger IPT - 100 Fund seeks to achieve this
objective by investing primarily in common stocks of established companies which
are believed to offer favorable growth prospects. Current income is not an
investment objective of the Berger IPT - 100 Fund, and any income produced will
be a by-product of the effort to achieve the Fund's objective.

BERGER IPT - GROWTH AND INCOME FUND: The primary investment objective of the
Berger IPT - Growth and Income Fund is capital appreciation. A secondary
objective is to provide a moderate level of current income. The Berger IPT -
Growth and Income Fund seeks to achieve these objectives by investing primarily
in common stocks and other securities, such as convertible securities or
preferred stocks, which the Fund's advisor believes offer favorable growth
prospects and are expected to also provide current income.

BERGER IPT - SMALL COMPANY GROWTH FUND: The investment objective of the Berger
IPT - Small Company Growth Fund is capital appreciation. The Berger IPT - Small
Company Growth Fund seeks to achieve this objective by investing primarily in
equity securities (including common and preferred stocks, convertible debt
securities and other securities having equity features) of small growth
companies with market capitalization of less than $1 billion at the time of the
initial purchase.

BERGER/BIAM IPT - INTERNATIONAL FUND: The investment objective of the
Berger/BIAM IPT - International Fund is long-term capital appreciation. The
Berger/BIAM IPT - International Fund seeks to achieve this objective by
investing primarily in common stocks of well established companies located
outside the United States. The Fund intends to diversify its holdings among
several countries and to have, under normal market conditions, at least 65% of
the Fund's total assets invested in the securities of companies located in at
least five countries, not including the United States.

Berger Associates, Inc. ("Berger") is the investment adviser and principal
underwriter to each of the above-mentioned Berger funds. Berger's principal
business address is 210 University Boulevard, Suite 900, Denver, Colorado 80206.

- ------------------------------------------------------------------------------------------------------
INVESTMENT
FUNDS MANAGEMENT OTHER TOTAL FUND
FEE EXPENSES ANNUAL EXPENSES
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>

BERGER INSTITUTIONAL PRODUCTS TRUST
Berger IPT - 100 Fund (1)(2) 0.00% 1.00% 1.00%
Berger IPT - Growth & Income Fund (1)(2) 0.00% 1.00% 1.00%
Berger IPT - Small Company Growth Fund (1)(2) 0.00% 1.15% 1.15%
Berger/BIAM IPT - International Fund (1)(3) 0.00% 1.20% 1.20%

- ------------------------------------------------------------------------------------------------------
</TABLE>

(1) Other Expenses primarily include transfer agency fees, shareholder report
expenses, registration fees and custodian fees.

(2) After fee waivers and expense reimbursements. The Funds' investment advisor
has voluntarily agreed to waive its advisory fee and has voluntarily
reimbursed the Funds for additional expenses to the extent that normal

<PAGE>

operating expenses in any fiscal year, including the investment fee but
excluding brokerage commissions, interest, taxes and extraordinary
expenses, of each of the Berger IPT - 100 Fund and the Berger IPT - Growth
and Income Fund exceed 1.00%, and the normal operating expenses in any
fiscal year of the Berger IPT - Small Company Growth Fund exceed 1.15%, of
the respective Fund's average daily net assets. Absent the voluntary waiver
and reimbursement, the investment management fee for the Berger IPT - 100
Fund, Berger IPT - Growth and Income Fund and the Berger IPT - Small
Company Growth Fund would have been 0.75%, 0.75% and 0.90%, respectively,
and their total fund operating expenses would have been 7.69%, 7.70% and
8.57%, respectively.

(3) Based on estimated expenses for the first year of operations of the
Berger/BIAM IPT - International Fund, after fee waivers and expense
reimbursements. The Fund's investment advisor has voluntarily agreed to
waive its advisory fee and expects to voluntarily reimburse the Fund for
additional expenses to the extent that normal operating expenses in any
fiscal year, including the investment management fee but excluding
brokerage commissions, interest, taxes and extraordinary expenses, of the
Berger/BIAM IPT - International Fund exceed 1.20%, of the Fund's average
daily net assets. Absent the voluntary waiver and reimbursement, the
investment management fee for Berger/BIAM IPT - International Fund would be
0.90%, and its total operating expenses would be estimated to be 8.96%.

DREYFUS CORPORATION FUNDS

The portfolios of the Dreyfus Variable Investment Fund, the Dreyfus Socially
Responsible Growth Fund, and the Dreyfus Stock Index Fund in which the Separate
Account may currently invest and their investment objectives and fees are as
follows:

CAPITAL APPRECIATION PORTFOLIO: Seeks to provide long-term capital growth
consistent with the preservation of capital; current income is a secondary
investment objective. This portfolio invests primarily in the common stocks of
domestic and foreign issuers.

DISCIPLINED STOCK PORTFOLIO: Seeks to provide investment results that are
greater than the total return performance of publicly-traded common stocks in
the aggregate, as represented by the Standard & Poor's 500 Composite Stock
Index. This portfolio will use quantitative statistical modeling techniques to
construct a portfolio in an attempt to achieve its investment objective, without
assuming undue risk relative to the broad stock market.

GROWTH AND INCOME PORTFOLIO: Seeks to provide long-term capital growth, current
income and growth of income, consistent with reasonable investment risk. This
portfolio invests primarily in equity securities, debt securities and money
market instruments of domestic and foreign issuers.

INTERNATIONAL EQUITY PORTFOLIO: Seeks to maximize capital growth. This portfolio
invests primarily in equity securities of foreign issuers located throughout the
world.

INTERNATIONAL VALUE PORTFOLIO: Seeks long-term capital growth. This portfolio
invests primarily in a portfolio of publicly-traded equity securities of foreign
issuers which would be characterized as "value" companies according to criteria
established by The Dreyfus Corporation.

MANAGED ASSETS PORTFOLIO: Seeks to maximize total return, consisting of capital
appreciation and current income. This portfolio follows an asset allocation
strategy by investing in equity securities, debt securities and money market
instruments of domestic and foreign issuers.

MONEY MARKET PORTFOLIO: Seeks to provide as high a level of current income as is
consistent with the preservation of capital and the maintenance of liquidity.
This portfolio invests in short-term money market instruments.

QUALITY BOND PORTFOLIO: Seeks to provide the maximum amount of current income to
the extent consistent with the preservation of capital and the maintenance of
liquidity. This portfolio invests principally in the debt obligations of
corporations, the U.S. Government and its agencies and instrumentalities, and
U.S. major banking institutions.

SMALL CAP PORTFOLIO: Seeks to maximize capital appreciation. This portfolio
invests primarily in common stocks of domestic and foreign issuers. This
portfolio will be particularly alert to companies that The Dreyfus Corporation
considers to be emerging smaller-sized companies which are believed to be
characterized by new or innovative products, services, or processes which should
enhance prospects for growth in future earnings.

SMALL COMPANY STOCK PORTFOLIO: Seeks to provide investment results that are
greater than the total return performance in publicly-traded common stocks in
the aggregate, as represented by the Russell 2500(TM) Index. This portfolio
invests primarily in a portfolio of equity securities of small to medium-sized
domestic issuers, while attempting to maintain volatility and diversification
similar to that of the Russell 2500(TM) Index.

<PAGE>

The Dreyfus Corporation ("Dreyfus") is the investment adviser to each of the
above-mentioned portfolios and funds. Dreyfus' principal business address is 200
Park Avenue, New York, New York 10166. The principal underwriter of the
portfolios and funds is Premier Mutual Fund Services, Inc., located at 60 State
Street, Boston, Massachusetts 02109.

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
FUNDS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>

DREYFUS FUNDS
Capital Appreciation Portfolio (1) 0.75% 0.09% 0.84%
Disciplined Stock Portfolio (1) 0.59% 0.21% 0.80%
Growth and Income Portfolio 0.75% 0.08% 0.83%
International Equity Portfolio 0.75% 0.53% 1.28%
International Value Portfolio (1) 0.66% 0.35% 1.01%
Managed Assets Portfolio 0.75% 0.18% 0.93%
Money Market Portfolio 0.50% 0.12% 0.62%
Quality Bond Portfolio 0.65% 0.14% 0.79%
Small Cap Portfolio 0.75% 0.04% 0.79%
Small Company Stock Portfolio (1) 0.56% 0.19% 0.75%

- -------------------------------------------------------------------------------------------
</TABLE>

(1) From time to time, The Dreyfus Corporation and, with respect to the Capital
Appreciation Portfolio, Fayez Sarofim & Co. may in their sole discretion
waive all or part of their fees and/or voluntarily assume certain expenses.
For a more complete description of fees and expenses, see the Funds'
prospectuses. As of the date of this Prospectus, certain fees are being
waived or expenses being assumed in each case on a voluntary basis. Without
such waivers or reimbursements, the investment management fees, other
expenses and total fund annual expenses that would have been incurred,
respectively, for the fiscal year ended December 31, 1996 are as follows:
Disciplined Stock Portfolio: 0.75%, 0.21% and 0.96%; International Value
Portfolio: 1.00%, 0.35% and 1.35%; and Small Company Stock Portfolio:
0.75%, 0.19% and 0.94%. There is no guarantee that any fee waivers or
expense reimbursements will continue in the future.

INVESCO FUNDS

The portfolios of the INVESCO Variable Investment Funds, Inc. in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

DYNAMICS FUND: Seeks appreciation of capital through aggressive investment
policies. The Dynamics Fund invests primarily in common stocks of U.S. companies
traded on national securities exchanges and over-the-counter.

HEALTH SCIENCES FUND: Seeks capital appreciation by normally investing at least
80% of its total assets in equity securities of companies that develop, produce,
or distribute products or services related to health care.

INDUSTRIAL INCOME FUND: Seeks the best possible current income while following
sound investment practices. Capital growth potential is an additional, but
secondary, consideration in the selection of portfolio securities. The fund
normally invests at least 65% of its total assets in dividend-paying common
stocks. Up to 10% of the fund's total assets may be invested in other
income-producing securities such as corporate bonds. The fund also has the
flexibility to invest in other types of securities.

SMALL COMPANY GROWTH FUND: Seeks long-term capital growth. The Small Company
Growth Fund invests primarily in small-capitalization equity securities of U.S.
companies traded "over-the-counter."

TECHNOLOGY FUND: Seeks capital appreciation. The Technology Fund normally
invests at least 80% of its total assets in equity securities of companies in
technology-related industries such as computers, communications, video,
electronics, oceanography, office and factory automation, and robotics.

TOTAL RETURN FUND: Seeks a high total return on investment through capital
appreciation and current income. The Total Return Fund seeks to achieve its
investment objective by investing in a combination of equity securities
(consisting of common stocks and, to a lesser degree, securities convertible
into common stock) and fixed income securities.

UTILITIES FUND: Seeks capital appreciation and income. The assets of the
Utilities Fund are invested primarily in equity securities of companies
principally engaged in business as public utilities.

<PAGE>

INVESCO Funds Group, Inc. ("INVESCO") serves as the investment adviser and
principal underwriter of each of the above-mentioned funds. INVESCO's principal
business address is 7800 E. Union Avenue, Denver, Colorado 80217-3706.

- ----------------------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
FUNDS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>

INVESCO VARIABLE INVESTMENT FUNDS, INC.
Dynamics Portfolio (1) 0.60% 0.30% 0.90%
Health Sciences Portfolio (1) 0.75% 0.25% 1.00%
Industrial Income Portfolio (2) 0.75% 0.20% 0.95%
Small Company Growth Portfolio (1) 0.75% 0.25% 1.00%
Technology Portfolio (1) 0.75% 0.25% 1.00%
Total Return Portfolio (2) 0.75% 0.19% 0.94%
Utilities Portfolio (2) 0.60% 0.56% 1.16%

- ----------------------------------------------------------------------------------------------
</TABLE>

(1) Expenses for the Dynamics Fund, the Health Sciences Fund, the Small Company
Growth Fund and the Technology Fund are estimated.

(2) Various expenses of the Portfolios were voluntarily absorbed by INVESCO
Funds Group, Inc. for the year ended December 31, 1996. If such expenses
had not been voluntarily absorbed. the ratio of expenses to average net
assets for the Industrial Income Portfolio, Total Return Portfolio, and
Utilities Portfolio would have been 1.19%, 1.30% and 5.36%, respectively.

JANUS ASPEN SERIES

The portfolios of the Janus Aspen Series in which the Separate Account may
currently invest and their investment objectives and fees are as follows:

AGGRESSIVE GROWTH PORTFOLIO: A nondiversified portfolio that seeks long-term
growth of capital by investing primarily in common stocks, with an emphasis on
securities issued by medium-sized companies.

BALANCED PORTFOLIO: A diversified portfolio that seeks long-term growth of
capital consistent with preservation of capital and balanced by current income.
The portfolio normally invests 40-60% of its assets in securities selected
primarily for their growth potential and 40-60% of its assets in securities
selected primarily for their income potential.

FLEXIBLE INCOME PORTFOLIO: A diversified portfolio that seeks to maximize total
return from a combination of income and capital appreciation, although income
will normally be the dominant component of total return. The portfolio invests
in many types income-producing securities and may have substantial holdings of
debt securities rated below investment grade.

GROWTH PORTFOLIO: A diversified portfolio that seeks long-term growth of capital
by investing primarily in common stocks, with an emphasis on issuers with larger
market capitalizations.

HIGH-YIELD PORTFOLIO: The primary investment objective of the High-Yield
Portfolio is to obtain high current income. Capital appreciation is a secondary
objective when consistent with the primary objective.

INTERNATIONAL GROWTH PORTFOLIO: A diversified portfolio that seeks long-term
growth of capital by investing primarily in the common stocks of foreign
issuers.

MONEY MARKET PORTFOLIO: The Money Market Portfolio's investment objective is to
seek maximum current income to the extent consistent with stability of capital.
There can be no assurance that the Portfolio will achieve its investment
objective or be able to maintain a stable net asset value of $1.00 per share.

SHORT-TERM BOND PORTFOLIO: The investment objective of the Short-Term Bond
Portfolio is to seek as high a level of current income as is consistent with
preservation of capital. The Portfolio pursues its objective by investing
primarily in short- and intermediate-term fixed-income securities.

WORLDWIDE GROWTH PORTFOLIO: A diversified portfolio that seeks long-term growth
of capital by investing primarily in common stocks of foreign and domestic
issuers.

<PAGE>

Janus Capital Corporation ("Janus Capital") serves as the investment adviser and
principal underwriter to each of the above-mentioned portfolios. Janus Capital's
principal business address is 100 Fillmore Street, Denver, Colorado 80206-4923.

- ---------------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
FUNDS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>

JANUS ASPEN SERIES
Aggressive Growth Portfolio (1) 0.72% 0.04% 0.76%
Balanced Portfolio (1) 0.79% 0.15% 0.94%
Flexible Income Portfolio (1) 0.65% 0.19% 0.84%
Growth Portfolio (1) 0.65% 0.04% 0.69%
High-Yield Portfolio (1) 0.00% 1.01% 1.01%
International Growth Portfolio (1) 0.05% 1.21% 1.26%
Money Market Portfolio (1) 0.00% 0.50% 0.50%
Short-Term Bond Portfolio (1) 0.47% 0.19% 0.66%
Worldwide Growth Portfolio (1) 0.66% 0.14% 0.80%

- ---------------------------------------------------------------------------------------
</TABLE>

(1) The fees and expenses in the table above are based on gross expenses of the
Portfolios before expense offset arrangements for the fiscal year ended
December 31, 1996. The information for each Portfolio other than the
Flexible Income Portfolio is net of fee waivers or reductions from Janus
Capital. Fee reductions for the Aggressive Growth, Balanced, Growth,
International Growth and Worldwide Growth Portfolios reduce the investment
management fee to the level of the corresponding Janus retail fund. Other
waivers, if applicable, are first applied against the investment management
fee and then against other expenses. Without such waivers or reductions,
the investment management fee, other expenses and total fund annual
expenses would have been 0.79%, 0.04% and 0.83% for Aggressive Growth
Portfolio; 0.92%, 0.15% and 1.07% for Balanced Portfolio; 0.79%, 0.04% and
0.83% for Growth Portfolio; 0.75%, 5.54% and 6.29% for the High-Yield
Portfolio; 1.00%, 1.21% and 2.21% for International Growth Portfolio;
0.25%, 0.53% and 0.78% for the Money Market Portfolio; 0.65%, 0.19% and
0.84% for Short-Term Bond Portfolio and 0.77%, 0.14% and 0.91% for
Worldwide Growth Portfolio, respectively. Janus Capital may modify or
terminate the waivers or reductions at any time upon at least 90 days'
notice to the Trustees.

KEMPER INVESTORS FUND

The portfolios of the Kemper Investors Fund in which the Separate Account may
currently invest and their investment objectives and fees are as follows:

GOVERNMENT SECURITIES PORTFOLIO: Seeks high current return consistent with
preservation of capital from a portfolio composed primarily of U.S. Government
securities.

GROWTH PORTFOLIO: Seeks maximum appreciation of capital through diversification
of investment securities having potential for capital appreciation.

HIGH YIELD PORTFOLIO: Seeks to provide a high level of current income by
investing in fixed-income securities.

HORIZON 5 PORTFOLIO: Designed for investors with approximately a 5 year
investment horizon, seeks income consistent with preservation of capital, with
growth of capital as a secondary objective.

HORIZON 10+ PORTFOLIO: Designed for investors with approximately a 10+ year
investment horizon, seeks a balance between growth of capital and income,
consistent with moderate risk.

HORIZON 20+ PORTFOLIO: Designed for investors with approximately a 20+ year
investment horizon, seeks growth of capital, with income as a secondary
objective.

INTERNATIONAL PORTFOLIO: Seeks total return, a combination of capital growth and
income, principally through an internationally diversified portfolio of equity
securities.

INVESTMENT GRADE BOND PORTFOLIO: Seeks high current income by investing
primarily in a diversified portfolio of investment grade debt securities.

MONEY MARKET PORTFOLIO: Seeks maximum current income to the extent consistent
with stability of principal from a portfolio of high quality money market
instruments.

<PAGE>

SMALL CAP GROWTH PORTFOLIO: Seeks maximum appreciation of investors' capital
from a portfolio primarily of growth stocks of smaller companies.

SMALL CAP VALUE PORTFOLIO: Seeks long-term capital appreciation from a portfolio
primarily of value stocks of smaller companies.

TOTAL RETURN PORTFOLIO: Seeks a high total return, a combination of income and
capital appreciation, by investing in a combination of debt securities and
common stocks.

VALUE PORTFOLIO: Seeks to achieve a high rate of total return from a portfolio
primarily of value stocks of larger companies.

VALUE+GROWTH PORTFOLIO: Seeks growth of capital through professional management
of a portfolio of growth and value stocks.

Zurich Kemper Investments, Inc., ("ZKI", formerly named Kemper Financial
Services, Inc.) serves as investment manager for each of the portfolios other
than the Value Portfolio and the Small Cap Value Portfolio. Dreman Value
Advisors ("DVA"), a wholly owned subsidiary of ZKI, serves as the investment
manager for the Value and the Small Cap Value Portfolio. ZKI's principal
business address is 120 South LaSalle Street, Chicago, Illinois 60603. DVA's
principal business address is 10 Exchange Place, 20th Floor, Jersey City, New
Jersey 07302. Kemper Distributors, Inc. serves as the principal underwriter of
the portfolios and is located at 120 South LaSalle Street, Chicago, Illinois
60603.

INVESTORS FUND SERIES
Government Securities Portfolio 0.55% 0.11% 0.66%
Growth Portfolio 0.60% 0.04% 0.64%
High Yield Portfolio 0.60% 0.05% 0.65%
Horizon 5 Portfolio 0.60% 0.30% 0.90%
Horizon 10+ Portfolio 0.60% 0.20% 0.80%
Horizon 20+Portfolio 0.60% 0.25% 0.85%
International Portfolio 0.75% 0.21% 0.96%
Investment Grade Bond Portfolio 0.60% 0.25% 0.85%
Money Market Portfolio 0.50% 0.10% 0.60%
Small Cap Growth Portfolio 0.65% 0.10% 0.75%
Small Cap Value Portfolio 0.75% 0.20% 0.95%
Total Return Portfolio 0.55% 0.04% 0.59%
Value Portfolio 0.75% 0.20% 0.95%
Value+Growth Portfolio 0.75% 0.20% 0.95%

- --------------------------------------------------------------------------------

MFS VARIABLE INSURANCE TRUST

The portfolios of the MFS Variable Insurance Trust in which the Separate Account
may currently invest and their investment objectives and fees are as follows:

MFS BOND SERIES: Seeks primarily to provide as high a level of current income as
is believed consistent with prudent investment risk and secondarily to protect
shareholders' capital.

MFS EMERGING GROWTH SERIES: Seeks long-term growth of capital.

MFS GROWTH WITH INCOME SERIES: Seeks to provide reasonable current income and
long-term growth of capital and income.

MFS HIGH INCOME SERIES: Seeks high current income by investing primarily in a
professionally managed diversified portfolio of fixed-income securities, some of
which may involve equity features.

MFS LIMITED MATURITY SERIES: Seeks primarily to provide as high a level of
current income as is believed to be consistent with prudent investment risk and
secondarily to protect shareholders' capital.

MFS MONEY MARKET SERIES: Seeks as high a level of current income as is
considered consistent with the preservation of capital and liquidity.

<PAGE>

MFS RESEARCH SERIES: Seeks to provide long-term growth of capital and future
income.

MFS TOTAL RETURN SERIES: Seeks primarily to provide above-average income
(compared to a portfolio invested entirely in equity securities) consistent with
the prudent employment of capital and secondarily to provide a reasonable
opportunity for growth of capital and income.

MFS UTILITIES SERIES: Seeks capital growth and current income (income above that
available from a portfolio invested entirely in equity securities).

MFS VALUE SERIES: Seeks capital appreciation.

MFS WORLD GOVERNMENT SERIES: Seeks not only preservation, but also growth, of
capital, together with moderate current income.

The investment adviser for each series is Massachusetts Financial Services
Company ("MFS"). MFS' principal business address is 500 Boylston Street, Boston,
Massachusetts 02116. The principal underwriter of the series is MFS Fund
Distributors, Inc. located at 500 Boylston Street, Boston, Massachusetts 02116.

- -------------------------------------------------------------------------------------------------
INVESTMENT
MANAGEMENT TOTAL FUND
FUNDS AND FUND OTHER ANNUAL EXPENSES
ADMINISTRATION EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MFS VARIABLE INSURANCE TRUST
MFS Bond Series (1)(2) 0.60% 0.40% 1.00%
MFS Emerging Growth Series (1)(2) 0.75% 0.25% 1.00%
MFS Growth with Income Series (1)(2) 0.75% 0.25% 1.00%
MFS High Income Series (1)(2) 0.75% 0.25% 1.00%
MFS Limited Maturity Series (1)(2) 0.55% 0.45% 1.00%
MFS Money Market Series (1)(2) 0.50% 0.10% 0.60%
MFS Research Series (1)(2) 0.75% 0.25% 1.00%
MFS Total Return Series (1)(2) 0.75% 0.25% 1.00%
MFS Utilities Series (1)(2) 0.75% 0.25% 1.00%
MFS Value Series (1)(2) 0.75% 0.25% 1.00%
MFS World Government Series (1)(2) 0.75% 0.25% 1.00%
- -------------------------------------------------------------------------------------------------

</TABLE>

(1) MFS has agreed to bear expenses for each Series, subject to reimbursement
by each Series, such that each Series' "Other Expenses" shall not exceed
the following percentages of the average daily net assets of the Series
during the current fiscal year: 0.40% for the Bond Series, 0.45% for the
Limited Maturity Series, 0.10% for the Money Market Series, and 0.25% for
each remaining Series. Otherwise, "Other Expenses" for the Bond Series,
Emerging Growth Series, Growth with Income Series, High Income Series,
Limited Maturity Series, Money Market Series, Research Series, Total Return
Series, Utilities Series, Value Series and Worldwide Government Series
would be 8.85%, 0.41%, 1.32%, 0.87%, 7.00%, 27.24%, 0.73%, 1.35%, 2.00%,
3.08% and 1.28%, respectively, and total fund annual expenses would be
9.45%, 1.16%, 2.07%, 1.62%, 7.55%, 27.74%, 1.48%, 2.10%, 2.75%, 3.83% and
2.03%, respectively, for these Series. See "Information Concerning Shares
of Each Series - Expenses."

(2) Each Series has an expense offset arrangement which reduces the Series'
custodian fee based upon the amount of cash maintained by the Series with
its custodian and dividend disbursing agent, and may enter into other such
arrangements and directed brokerage arrangements (which would also have the
effect of reducing the Series' expenses). Any such fee reductions are not
reflected under "Other Expenses."

NEUBERGER & BERMAN MANAGEMENT, INC.

The portfolios of the Neuberger & Berman Advisers Management Trust in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

N&B AMT GROWTH PORTFOLIO: Seeks capital growth through investments in common
stocks of companies believed to be under-valued and having above-average
potential for capital appreciation. The portfolio is heavily diversified among a
number of stocks to limit risk.

<PAGE>

N&B AMT LIMITED MATURITY BOND PORTFOLIO: Seeks the highest current income
consistent with low risk to principal and liquidity; and secondarily, total
return. Investments are made in a diversified portfolio of short- to
intermediate- term U.S. Government and Agency securities and primarily
investment grade debt securities issued by financial institutions, corporations,
and others.

N&B AMT PARTNERS PORTFOLIO: Invests primarily in common stocks of established
companies, using the value- oriented investment approach. Capital growth is
sought through an investment approach that is designed to increase capital with
reasonable risk. Investments are made in securities that are believed to be
undervalued based on strong fundamentals such as low price-to-earnings ratios,
consistent cash flow, and support from asset values.

N&B Management ("N&B") serves as the investment manager of the portfolios and is
also the principal underwriter of the portfolios. N&B's principal business
address is 605 Third Avenue, New York, New York 10158-0180.

- -----------------------------------------------------------------------------------------------
INVESTMENT
MANAGEMENT/ OTHER TOTAL FUND
FUNDS ADMINISTRATIVE EXPENSES ANNUAL EXPENSES
FEES
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NEUBERGER & BERMAN ADVISERS MANAGEMENT
TRUST
N&B AMT Growth Portfolio 0.83% 0.09% 0.92%
N&B AMT Limited Maturity Bond Portfolio 0.65% 0.13% 0.78%
N&B AMT Partners Portfolio 0.84% 0.11% 0.95%
- -----------------------------------------------------------------------------------------------

</TABLE>

THE ROYCE PORTFOLIOS

The portfolios of Royce Capital Trust in which the Separate Account may
currently invest and their investment objectives and fees are as follows:

ROYCE MICRO-CAP PORTFOLIO: Seeks long-term capital appreciation, primarily
through investments in common stocks and convertible securities of small and
micro-cap companies. Production of income is incidental to this objective.

ROYCE PREMIER PORTFOLIO: Seeks long-term growth and secondarily current income
by investing in a limited portfolio of common stocks and convertible securities
viewed as having superior financial characteristics and/or unusually attractive
business prospects.

ROYCE TOTAL RETURN PORTFOLIO: Seeks to have an equal focus on both long term
growth of capital and current income by investing in a broadly diversified
portfolio of dividend paying common stocks of companies selected on a value
basis.

Quest Advisory Corp. ("Quest") serves as the investment manager of the
portfolios. Quest's principal business address is 1414 Avenue of the Americas,
New York, New York 10019. The principal underwriter of the portfolios is Quest
Distributors, Inc., 1414 Avenue of the Americas, New York, New York 10019.
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------
INVESTMENT TOTAL FUND
MANAGEMENT OTHER ANNUAL EXPENSES
FUNDS FEE (AFTER EXPENSES (AFTER EXPENSE
WAIVERS) REIMBURSEMENTS)
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>

THE ROYCE PORTFOLIOS
Royce Micro-Cap Portfolio (1) 0.00% 1.35% 1.35%
Royce Premier Portfolio (1) 0.00% 1.35% 1.35%
Royce Total Return Portfolio (1) 0.00% 1.35% 1.35%

- ---------------------------------------------------------------------------------------
</TABLE>

(1) Investment management fees would be 1.00%, 1.00% and 1.25% and total fund
annual expenses would be 2.35%, 2.35% and 2.59% for the Micro-Cap
Portfolio, the Premier Portfolio, and the Total Return Portfolio,
respectively, without the waivers of investment management fees by Quest.
Quest has voluntarily committed to waive its fees through December 31, 1997
to the extent necessary to maintain total fund annual expenses of each Fund
at or below 1.35%.

<PAGE>

SCUDDER VARIABLE LIFE INVESTMENT FUND

The portfolios of the Scudder Variable Life Investment Fund in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

BALANCED PORTFOLIO: Seeks a balance of growth and income, as well as long-term
preservation of capital, from a diversified portfolio of equity and fixed income
securities.

BOND PORTFOLIO: Seeks high income from a high quality portfolio of bonds.

CAPITAL GROWTH PORTFOLIO: Seeks to maximize long-term capital growth from a
portfolio consisting primarily of equity securities.

GLOBAL DISCOVERY PORTFOLIO: Seeks above-average capital appreciation over the
long term by investing primarily in the equity securities of small companies
located around the world.

GROWTH & INCOME PORTFOLIO: Seeks long-term growth of capital, current income and
growth of income from a portfolio consisting of common stocks and securities
convertible into common stocks.

INTERNATIONAL PORTFOLIO: Seeks long-term growth of capital principally from a
diversified portfolio of foreign equity securities.

MONEY MARKET PORTFOLIO: Seeks stability and current income from a portfolio of
money market instruments. The Money Market Portfolio will maintain a
dollar-weighted average portfolio maturity of 90 days or less in an effort to
maintain a constant net asset value of $1.00 per share.

The investment adviser for each portfolio is Scudder, Stevens & Clark, Inc.
("Scudder"). Scudder's principal business address is Two International Place,
Boston, Massachusetts 02110-4103. The principal underwriter of the portfolios is
Scudder Investor Services, Inc., a Scudder subsidiary, located at Two
International Place, Boston, Massachusetts 02110-4103.

- --------------------------------------------------------------------------------------------------
OTHER
MANAGEMENT 12-B-1 EXPENSES TOTAL FUND
FUNDS FEE FEE (AFTER ANNUAL
REIMBURSE EXPENSES
MENT)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>

SCUDDER VARIABLE LIFE INVESTMENT FUND-
(CLASS B SHARES)
Balanced Portfolio 0.475% 0.250% 0.125% 0.850%
Bond Portfolio 0.475% 0.250% 0.135% 0.860%
Capital Growth Portfolio 0.475% 0.250% 0.055% 0.780%
Global Discovery Portfolio (1) 0.975% 0.250% 1.345% 2.570%
Growth & Income Portfolio 0.475% 0.250% 0.185% 0.910%
International Portfolio 0.863% 0.250% 0.187% 1.300%
Money Market Portfolio 0.370% 0.250% 0.090% 0.710%

- --------------------------------------------------------------------------------------------------
</TABLE>

(1) The ratio of operating expenses to average net assets for the Global
Discovery Portfolio has been restated to reflect actual expenses. During
1996 the portfolio had an expense limitation of 1.50% which consisted of an
investment management fee of 0.155% and other expenses of 1.345%.

THE STRONG FUNDS

The Strong Funds in which the Separate Account may currently invest and their
investment objectives and fees are as follows:

STRONG DISCOVERY FUND II: Seeks capital growth by investing in securities that
are believed to represent attractive growth opportunities. The fund's investment
advisor seeks companies, regardless of size or maturity, that are poised for
accelerated earnings growth due to innovative products or services, new
management, or favorable economic or market cycles.

STRONG GROWTH FUND II: Seeks capital growth by investing in securities that are
believed to have above-average growth prospects. The fund will generally invest
in companies whose earnings are believed to be in a relatively

<PAGE>

strong growth trend, and to a lesser extent, in companies in which significant
further growth is not anticipated but whose market value is thought to be
undervalued.

STRONG INTERNATIONAL STOCK FUND II: Seeks capital growth by investing in
securities of issuers located outside the United States. The fund will normally
invest in securities of issuers in at least three different countries.

STRONG SPECIAL FUND II: Seeks capital growth by investing in equity securities
and currently emphasizes investments in medium-sized companies that the
investment advisor believes are under-researched and attractively valued. The
fund's investment advisor looks for companies with fundamental value or growth
potential that is not yet reflected in their current market prices. The fund's
investments are likely to consist, in part, in securities in small and
medium-sized companies.

The investment adviser for each fund is Strong Capital Management, Inc.
("Strong"). Strong's principal business address is P.O. Box 2936, Milwaukee,
Wisconsin 53201. The principal underwriter of the funds is Strong Funds
Distributors, Inc., located at P.O. Box 2936, Milwaukee, Wisconsin 53201.

- ------------------------------------------------------------------------------------------
INVESTMENT
FUNDS MANAGEMENT OTHER TOTAL FUND
FEE EXPENSES ANNUAL EXPENSES
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>

THE STRONG FUNDS
Strong Discovery Fund II (1) 1.000% 0.210% 1.210%
Strong Growth Fund II (1)(2) 1.000% 0.240% 1.240%
Strong International Stock Fund II (1) 1.000% 0.900% 1.900%
Strong Special Fund II (1) 1.000% 0.170% 1.170%

- ------------------------------------------------------------------------------------------

</TABLE>

(1) As of December 31, 1996.

(2) Expenses for the Strong Growth Fund II are estimated for 1997.

T. ROWE PRICE VARIABLE FUNDS

The portfolios of the T. Rowe Price Equity Series, Inc., T. Rowe Price
International Series, Inc., and the T. Rowe Price Fixed Income Series, Inc. in
which the Separate Account may currently invest and their investment objectives
and fees are as follows:

EQUITY INCOME PORTFOLIO: Seeks to provide substantial dividend income and also
long-term capital appreciation by investing primarily in dividend-paying common
stocks, particularly of established companies, with favorable prospects for both
increasing dividends and capital appreciation.

INTERNATIONAL STOCK PORTFOLIO: Seeks to provide capital appreciation through
investment primarily in established companies based outside the United States.

LIMITED-TERM BOND PORTFOLIO: Seeks to provide a high level of income consistent
with moderate fluctuation in principal value by investing primarily in
investment-grade, corporate bonds.

MID-CAP GROWTH PORTFOLIO: Seeks to provide long-term capital appreciation by
investing primarily in common stocks of medium-sized (mid-cap) growth companies.
The portfolio will focus on companies with superior earnings growth potential
that are no longer considered new or emerging, but are not yet well-established.

NEW AMERICA GROWTH PORTFOLIO: Seeks to provide long-term capital growth by
investing primarily in common stocks of U.S. growth companies operating in
service industries. The portfolio invests in the stocks of large and small
service companies expected by the fund's investment advisor to show superior
earnings growth.

PERSONAL STRATEGY BALANCED PORTFOLIO: Seeks the highest total return over time
consistent with an emphasis on both capital appreciation and income by investing
in a diversified portfolio of stocks, bonds, and money market securities.

PRIME RESERVE PORTFOLIO: Seeks preservation of capital, liquidity, and the
highest possible income consistent with these goals by investing in
high-quality, U.S. dollar-denominated money market securities.

The investment manager for each portfolio, except the International Stock
Portfolio, is T. Rowe Price Associates, Inc. ("T. Rowe Price"). T. Rowe Price's
principal business address is 100 East Pratt Street, Baltimore, Maryland 21202.
Rowe Price-Fleming International Inc. ("Price-Fleming"), an affiliate of T. Rowe
Price, serves as investment

<PAGE>

adviser to the International Stock Portfolio and its U.S. office is located at
100 East Pratt Street, Baltimore, Maryland 21202. T. Rowe Price also serves as
the principal underwriter of the portfolios.

- --------------------------------------------------------------------------------------------
INVESTMENT
FUNDS MANAGEMENT OTHER TOTAL FUND
FEE EXPENSES ANNUAL EXPENSES
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C>
T. ROWE PRICE VARIABLE FUNDS
Equity Income Portfolio (1) 0.00% 0.00% 0.85%
International Stock Portfolio (1) 0.00% 0.00% 1.05%
Limited-Term Bond Portfolio (1) 0.00% 0.00% 0.70%
Mid-Cap Growth Portfolio (1) 0.00% 0.00% 0.85%
New America Growth Portfolio (1) 0.00% 0.00% 0.85%
Personal Strategy Balanced Portfolio (1) 0.00% 0.00% 0.90%
Prime Reserve Portfolio (1) 0.00% 0.00% 0.55%
- --------------------------------------------------------------------------------------------

</TABLE>

(1) Fees are all-inclusive.

WARBURG PINCUS PORTFOLIOS

The portfolios of Warburg Pincus Trust and Warburg Pincus Trust II in which the
Separate Account may currently invest and their investment objectives and fees
are as follows:

EMERGING MARKETS PORTFOLIO: Seeks long-term growth of capital by investing
primarily in equity securities of non-U.S. issuers consisting of companies in
emerging securities markets.

FIXED INCOME PORTFOLIO: Seeks total return consistent with prudent investment
management.

GLOBAL FIXED INCOME PORTFOLIO: Seeks total return consistent with prudent
investment management, consisting of a combination of interest income, currency
gains and capital appreciation.

INTERNATIONAL EQUITY PORTFOLIO: Seeks long-term capital appreciation by
investing primarily in a broadly diversified portfolio of equity securities of
non-U.S. issuers.

POST-VENTURE CAPITAL PORTFOLIO: Seeks long-term growth of capital by investing
primarily in equity securities of issuers in their post-venture capital stage of
development and pursues an aggressive investment strategy.

SMALL COMPANY GROWTH PORTFOLIO: Seeks capital growth by investing in equity
securities of small-sized domestic companies.

The investment adviser for each portfolio is Warburg, Pincus Counsellors, Inc.
("Warburg"). Warburg's principal business address is 466 Lexington Avenue, New
York, New York 10017-3147. The principal underwriter of the portfolios is
Counsellors Securities, a Warburg subsidiary, located at 466 Lexington Avenue,
New York, New York 10017-3147.

- ------------------------------------------------------------------------------------------
TOTAL FUND
INVESTMENT OTHER ANNUAL EXPENSES
PORTFOLIOS MANAGEMENT EXPENSES (AFTER EXPENSE
FEE REIMBURSEMENTS)
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>

WARBURG PINCUS TRUST
Emerging Markets Portfolio (1) 0.45% 0.95% 1.40%
Fixed Income Portfolio (2) 0.48% 0.51% 0.99%
Global Fixed Income Portfolio (2) 0.52% 0.47% 0.99%
International Equity Portfolio (3) 0.96% 0.40% 1.36%
Post-Venture Capital Portfolio (1) 0.62% 0.78% 1.40%
Small Company Growth Portfolio (3) 0.90% 0.26% 1.16%

- -------------------------------------------------------------------------------------------
</TABLE>

(1) Absent the waiver of fees by the Portfolio's investment adviser and
co-administrator, investment management fees for the Emerging Markets
Portfolio and the Post-Venture Capital Portfolio would each equal 1.25%;
other expenses would equal 0.95% and 0.82%, respectively; and total fund
annual expenses would equal 2.20% and 2.07%, respectively. Other expenses
for each portfolio are based on annualized estimates of expenses

<PAGE>

for the fiscal year ending December 31, 1997, net of any fee waivers or
expense reimbursements. The investment adviser and co-administrator have
undertaken to limit each portfolio's total fund annual expenses to the
limits shown in the table above through December 31, 1997.

(2) Absent the waiver of fees by the portfolio's investment adviser and
co-administrator, investment management fees would equal 0.50% and 1.00%,
other expenses would equal 0.65% and 0.55% and total portfolio annual
expenses would equal 1.15% and 1.55% for the Fixed Income and Global Fixed
Income Portfolios, respectively. Other expenses are based upon annualized
estimates of expenses for the fiscal year ending December 31, 1997, net of
any fee waivers or expense reimbursements. The investment adviser and co-
administrator have undertaken to limit each portfolio's total annual
expenses to the limits shown in the table above through December 31, 1997.

(3) Investment management fees, other expenses and total fund annual expenses
are based on actual expenses for the fiscal year ended December 31, 1996,
net of any fee waivers or expense reimbursements. Without such waivers or
reimbursements, investment management fees would have equalled 1.00% and
0.90%; other expenses would have equalled 0.40% and 0.27%; and total fund
annual expenses would have equalled 1.40% and 1.17% for the International
Equity and Small Company Growth Portfolios, respectively. The investment
adviser and co-administrator have undertaken to limit total fund annual
expenses to the limits shown in the table above through December 31, 1997.

A FULL DESCRIPTION OF THE FUNDS, THEIR INVESTMENT OBJECTIVES, MANAGEMENT,
POLICIES, AND RESTRICTIONS, THEIR EXPENSES, THE RISKS ATTENDANT TO INVESTMENT
THEREIN, AND ALL OTHER ASPECTS OF THEIR OPERATIONS IS CONTAINED IN THE
ACCOMPANYING PROSPECTUSES FOR EACH AVAILABLE FUND AND IN THE RELATED STATEMENTS
OF ADDITIONAL INFORMATION, WHICH SHOULD BE READ IN CONJUNCTION WITH THIS
PROSPECTUS. THERE IS NO ASSURANCE THAT THE INVESTMENT OBJECTIVES WILL BE MET.
SUBJECT TO COMPLIANCE WITH APPLICABLE LAW, PRUDENTIAL MAY CEASE OFFERING ANY
FUND AND MAY SUBSTITUTE ANOTHER MUTUAL FUND FOR ANY FUND.

THE EXPENSES RELATING TO THE FUNDS (OTHER THAN THOSE OF THE SERIES FUND) HAVE
BEEN PROVIDED TO PRUDENTIAL BY THE FUNDS, AND HAVE NOT BEEN INDEPENDENTLY
VERIFIED BY PRUDENTIAL.

THE FIXED ACCOUNT

A Participant may elect to allocate all or part of the amount in his or her
Certificate Fund to the Fixed Account. The amount so allocated or transferred
becomes part of Prudential's general assets, commonly referred to as the general
account. Subject to applicable law, Prudential has sole discretion over the
investment of the assets of the general account, and Participants do not share
in the investment experience of those assets. Instead, Prudential guarantees
that the part of the Certificate Fund allocated to the Fixed Account will accrue
interest daily at a rate that Prudential declares periodically. This rate may
not be less than an effective annual rate of 4%, but Prudential may in its sole
discretion periodically declare a higher rate. At least annually and on request,
a Participant will be advised of the interest rate that currently applies to his
or her Certificate. Under certain Group Contracts, interest rates may be
determined based on the contract year the premium payments were received.

By allocating premium payments to the Fixed Account in amounts sufficient to
cover the monthly Certificate fund charges, a Participant can use the
Certificate as a way to obtain life insurance coverage, with little or no
accumulation of Cash Surrender Value. Even such a Participant retains, of
course, the option to build a Cash Surrender Value by paying larger premiums and
applying the excess amount to any of the investment options available under the
Certificate.

Transfers from the Fixed Account are subject to strict limits. See TRANSFERS,
page 25. The payment of any Cash Surrender Value attributable to the Fixed
Account may be delayed for up to 6 months. See WHEN PROCEEDS ARE PAID, page 37.

Because of exemptive and exclusionary provisions, interests in the Fixed Account
have not been registered under the Securities Act of 1933 and Prudential has not
been registered as an investment company under the Investment Company Act of
1940. Accordingly, interests in the Fixed Account are not subject to the
provisions of these Acts, and Prudential has been advised that the staff of the
Securities and Exchange Commission has not reviewed the disclosure in this
Prospectus relating to the Fixed Account. Disclosures concerning the Fixed
Account may, however, be subject to certain provisions of the federal securities
laws relating to the accuracy of statements made in a prospectus.

<PAGE>

DETAILED INFORMATION ABOUT THE CERTIFICATES

ISSUANCE OF A CERTIFICATE

Eligible Group Members wishing to obtain insurance coverage through the Group
Contract must complete the appropriate enrollment form and undergo any required
medical underwriting, including in some cases a medical examination. If the
enrollment form is accepted, Prudential will issue a Certificate to that
individual (the "Participant") which will describe the rights, benefits,
coverage, and obligations with respect to the coverage. The minimum Face Amount
for a Certificate is $10,000. The maximum age at which a Certificate may
initially be issued is generally 74. The maximum age beyond which a person may
no longer be covered under a Certificate is generally 100. At age 100, the
Participant may: (1) elect to receive the Cash Surrender Value of the
Certificate; (2) elect to purchase Paid-Up Insurance; or (3) continue to hold
the Certificate. If option 3 is chosen, monthly charges attributable to the cost
of insurance and additional insurance benefits will be waived and the Death
Benefit will equal the Certificate Fund reduced by any Certificate Debt and any
past due monthly charges. At age 100 and beyond, the Participant cannot make
premium contributions, although loan repayments will be permitted. Prudential
believes a cash distribution upon termination of coverage will be subject to the
same tax treatment as other cash surrenders. See TAX TREATMENT OF CERTIFICATE
BENEFITS, page 35. Particular Group Contracts may provide that coverage under a
Certificate will terminate at less than age 100. Participants should refer to
their particular Certificate and Group Contract for the details of when coverage
will terminate.

Generally, the Participant is the Covered Person under a Certificate. Some Group
Contracts, however, may permit an Eligible Group Member to also apply for a
Certificate naming his or her spouse as the Covered Person. A separate
Certificate will be issued for such spousal coverage but, under each Certificate
the Participant and/or Assignee(s) are the only persons eligible to exercise the
rights provided under the Certificate.

APPLICANT OWNER PROVISION

The "applicant owner provision," included as part of the Group Contract, allows
an "eligible applicant owner" to apply for insurance coverage on the life of an
Eligible Group Member. An "eligible applicant owner" is a person other than the
Eligible Group Member who may be, but is not limited to, the Eligible Group
Member's spouse, child, parent, grandparent, grandchild, sister, brother, or the
trustee of any trust of which the Eligible Group Member is the grantor. At any
one time, only one person may be an "eligible applicant owner" with respect to a
Certificate.

The "eligible applicant owner" must complete the appropriate enrollment form,
which may require the Eligible Group Member to undergo any required medical
underwriting, including in some cases a medical examination. The enrollment form
must also be signed by the Eligible Group Member. If the enrollment form is
accepted, Prudential will issue a Certificate to the "eligible applicant owner"
which will describe the rights, benefits, coverage, and obligations with respect
to the coverage. References in this prospectus to "Participant" will be deemed
to include reference to an "eligible applicant owner".

SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"

Generally, a Certificate may be returned for a refund within 10 days after it is
received by the Participant. Some states allow a longer period of time during
which a Certificate may be returned for a refund. A refund can be requested by
mailing or delivering the Certificate to Prudential (or Prudential's designated
agent) at the address specified in the Certificate. The Participant who
exercises his or her short-term cancellation right will receive a refund of all
premium payments made, with no adjustment for investment experience. However, if
applicable state law so requires, the Participant will then receive a refund of
all premium payments made, plus or minus any change due to investment experience
in the value of the invested portion of the premiums, calculated as if no
charges had been made against the Separate Account or the Funds. During the
first 20 days following the Certificate Date, premium payments will be invested
in a money market fund. Prudential also reserves the right to limit
contributions during the Free Look period.

PROCEDURES

The procedures for submitting enrollment forms, premium payments, transfer
orders, reallocations, loan or withdrawal requests or other communications
relating to the Participant's insurance will depend on the specific terms of the
particular Group Contract. Under some Group Contracts, communications relating
to a Participant's insurance may be submitted to the Contractholder or its agent
who then passes the communications on to Prudential. Under some Group Contracts,
the Participant may communicate directly with Prudential (or Prudential's
designated agent) with respect to certain types of transactions. Each Group
Contract and the Certificates issued

<PAGE>

thereunder will set forth the applicable procedures, so a Participant should
consult those documents in determining how to submit a payment or document, make
transfers, request loans and withdrawals, or reallocate premium payments. In all
cases, enrollment forms and other documents, payments, orders and all other
communications will be deemed received by Prudential when received in good order
at the address specified in the Certificate.

PREMIUMS

Participants will generally have flexibility in determining the amount and
timing of premium payments, although a Participant may be required to pay an
appropriate specified initial premium to become a Participant. The minimum
initial premium will vary by group, but will always be no more than 50% of the
Guideline Annual Premium. A Certificate will remain in force so long as the
Certificate Fund is sufficient to cover monthly charges. In general, if the
Certificate Fund minus Certificate Debt and outstanding charges on any
Monthiversary is insufficient to cover the charges for that month, then the
coverage will be in default and a grace period will begin. See LAPSE, page 33.
Some Contracts may provide that if a Participant pays certain specified premiums
during the first two Certificate Years, the Certificate will not go into default
even if the Certificate Fund is insufficient to cover monthly charges.
Participants should refer to their particular Certificates for the details of
this default protection.

In addition to any premium paid on a routine basis, for example through salary
deduction, a Participant may make additional premium payments at any time,
subject to any applicable charges. There is no minimum amount for premiums paid
on a routine basis, but any additional premium payment must be at least $100.
Prudential reserves the right to limit the amount of such additional premiums.

The method by which premiums will be paid will be set forth in the Group
Contract. Some Participants will make payments to the Contractholder (or its
agent), which will then remit them to Prudential as premium payments. Prudential
will then allocate premium payments it receives to the Participant's investment
options according to the instructions received. Other Participants will make
payments directly to Prudential at the address specified in their Certificate or
authorize Prudential (or Prudential's designated agent) to receive payment using
electronic funds transfers or credit/debit cards. There may be higher monthly
administrative charges when premium payments are made directly to Prudential.
See CHARGES AND EXPENSES, page 28.

Due to the payment of additional premiums, or investment growth, the total
amount of insurance may have to be increased for the insurance to continue to
qualify as life insurance for federal tax purposes. In addition, if a
Participant makes premium payments in excess of certain limits, the tax status
of the insurance may change to that of a "Modified Endowment Contract" under
Section 7702A of the Internal Revenue Code, which could be significantly
disadvantageous from a tax standpoint. See TAX TREATMENT OF CERTIFICATE
BENEFITS, page 35. Prudential reserves the right not to accept or to return any
premium payment which would cause a Participant's insurance to fail to qualify
as life insurance under applicable tax laws, or which would increase the Death
Benefit by more than it increases the Certificate Fund.

EFFECTIVE DATE OF INSURANCE

A Participant's insurance will go into effect on the first Contract
Monthiversary after his or her enrollment form for participation under the Group
Contract, including underwriting, if any, is approved. That effective date is
the Certificate Date.

ALLOCATION OF PREMIUMS

BEFORE OR ON CERTIFICATE DATE. All premium payments (less any applicable
charges) received before the Certificate Date will not be invested and will be
deposited, for the benefit of the Participant, in Prudential's general account.
All premium payments received on the Certificate Date will be applied to the
money market fund chosen by the Contractholder as of the Certificate Date, after
the deduction of any applicable charges, see CHARGES AND EXPENSES, page 28. Such
Net Premiums will be invested as of the Certificate Date in the money market
fund chosen by the Contractholder for 20 days and will thereafter be allocated
to the investment options selected by the Participant.

AFTER CERTIFICATE DATE. Premiums paid after the Certificate Date will be reduced
by any applicable charges. See CHARGES AND EXPENSES, page 28. Assuming the
Certificate has been effective for 20 days, such Net Premiums will be allocated
to the investment options selected by the Participant as of the end of the
Valuation Period in which Prudential (or Prudential's designated agent) receives
such premium payments. Premium payments received within the first 20 days after
the Certificate Date will be applied to the money market fund chosen by the
Contractholder.

CHANGING PREMIUM ALLOCATIONS. If his or her insurance is not in default, a
Participant may change the way in which premiums are allocated among the
available investment option(s). Such a change will be effective as of the end

<PAGE>

of the Valuation Period during which Prudential (or Prudential's designated
agent) receives the Participant's request on a form approved by Prudential. The
minimum percentage that a Participant may allocate to any available Subaccount
or the Fixed Account is 5%, and all allocations must be in whole percentages.
Currently, there is no transaction charge for reallocating future premiums,
although Prudential reserves the right to impose a transaction charge in the
future.

TRANSFERS

If his or her insurance is not in default, a Participant may transfer amounts
from one available Subaccount to another available Subaccount, or to the Fixed
Account. There is no limit on the number of transfers among available
Subaccounts or to the Fixed Account. Under certain Group Contracts, Prudential
may reserve the right to impose a transaction charge of up to $20 for each
transfer in a Certificate Year after the twelfth transfer in that Certificate
Year.

Transfers will take effect as of the end of the Valuation Period in which a
proper transfer request is received by Prudential (or Prudential's designated
agent) on a form approved by Prudential. The request may be in terms of dollars,
such as a request to transfer $10,000 from one available Subaccount to another
available Subaccount, or may be in terms of a percentage reallocation among
available Subaccounts. The minimum amount that may be transferred from any one
investment option is $100 or the entire balance in that investment option,
whichever is less. For transfer requests in percentage terms, as with premium
reallocations, the percentages must be in whole numbers and no allocation may be
less than 5%.

Transfers from the Fixed Account to the available Subaccounts are currently
permitted once each Certificate Year. The amount of that transfer cannot exceed
$5,000 or 25% of the balance in the Fixed Account, whichever is greater. Such
transfer requests will take effect as of the end of the Valuation Period in
which a proper transfer request is received by Prudential (or Prudential's
designated agent) on a form approved by Prudential. These limits are subject to
change in the future.

DOLLAR COST AVERAGING

Each Group Contract will include a provision under which a Participant may elect
Dollar Cost Averaging ("DCA"). DCA enables a Participant to systematically
transfer specified dollar amounts or percentages from a money market Subaccount
to the other available Subaccounts at regular intervals. The Participant can
elect that a certain number of transfers be made under the DCA feature. Once the
designated number of transfers has been made, DCA will terminate.

DCA may be selected by establishing a money market subaccount value of at least
$1,000. The minimum transfer amount is $100. All DCA transfers will be made
effective as of the end of the first Valuation Period following the first of the
month. Election of this arrangement may occur at any time after the Certificate
Date by properly completing the DCA election form and returning it to the
address specified on the form. If the DCA election form is received by the tenth
day of the month, then DCA processing will commence during the next month. If
the DCA election form is received after the tenth day of a month, then DCA
processing will commence during the month immediately following the next
succeeding month. Any transfers made pursuant to DCA are not counted in
determining the number of transfers subject to the transfer charge.

DCA will terminate when any of the following occurs: (1) the number of
designated transfers has been completed; (2) the money market Subaccount value
is insufficient to complete the next transfer; (3) Prudential (or Prudential's
designated agent) receives a written request for termination by the tenth of the
month in order to cancel the transfer scheduled to take effect the following
month (written requests received after the tenth day of the month will take
effect during the month immediately following the next succeeding month); or (4)
the Certificate is lapsed, surrendered or otherwise terminated.

There is currently no charge for DCA. Prudential reserves the right to charge
for this feature in the future.

The main objective of DCA is to shield investments from short term price
fluctuations. Since the same dollar amount is transferred to an available
Subaccount with each transfer, more Subaccount units are purchased if the
Subaccount unit value is low, and fewer Subaccount units are purchased if the
unit value is high. Therefore, a lower than average cost per unit may be
achieved over the long term. This plan of investing allows investors to take
advantage of market fluctuations but does not assure a profit or protect against
a loss in declining markets.

<PAGE>

DEATH BENEFITS

A Death Benefit is payable upon the death of the Covered Person. The Death
Benefit is generally the Face Amount of the Certificate, plus the value of the
Certificate Fund as of the date of death. The Death Benefit otherwise payable
will be reduced by any Certificate Debt and any past due monthly charges. If the
insurance is kept in force for several years and/or substantial premium payments
are made, the Certificate Fund may grow to a point where it is necessary to
increase the Death Benefit in order to ensure that the insurance will satisfy
the Internal Revenue Code's definition of life insurance. In that case, the
Death Benefit (before the subtraction of Certificate Debt and unpaid charges)
must, under most Group Contracts, at least equal the following "corridor
percentage" of the Certificate Fund based on the insured's Attained Age:

INSURED'S CORRIDOR INSURED'S CORRIDOR
ATTAINED AGE PERCENTAGE ATTAINED AGE PERCENTAGE
------------ ---------- ------------ ----------
0-40 250% 70 115%
41 243 71 113
42 236 72 111
43 229 73 109
44 222 74 107
---- --- -- ---
45 215 75 105
46 209 76 105
47 203 77 105
48 197 78 105
49 191 79 105
---- --- -- ---
50 185 80 105
51 178 81 105
52 171 82 105
53 164 83 105
54 157 84 105
---- --- -- ---
55 150 85 105
56 146 86 105
57 142 87 105
58 138 88 105
59 134 89 105
---- --- -- ---
60 130 90 105
61 128 91 104
62 126 92 103
63 124 93 102
64 122 94 101
---- --- -- ---
65 120 95 100
66 119 96 100
67 118 97 100
68 117 98 100
69 116 99 100

Alternatively, certain Group Contracts may be issued under the cash value
accumulation test of the Internal Revenue Code. In such a case, the Death
Benefit under a Certificate (before the subtraction of Certificate Debt and
unpaid charges) must at least equal the Certificate Fund divided by the Net
Single Premium per dollar of insurance for the covered person's attained age.
For this purpose, Net Single Premiums are based upon the 1980 Commissioners'
Standard Ordinary Mortality Table (Male, Age Last Birthday) at 4.0% (the "1980
CSO Table").

The Death Benefit may be received in a lump sum. Alternatively, Prudential or
the Contractholder may elect for Death Benefits to be deposited into
Prudential's Alliance Account. However, the Participant or beneficiary can

<PAGE>

receive the Death Benefit in the form of a check upon request instead of having
the Death Benefit deposited to the Alliance Account.

The Alliance Account is an interest-bearing account that holds the Death Benefit
while the Participant or the beneficiary takes time to consider other options.
The Participant or the beneficiary has complete ownership of funds held in the
Alliance Account, and may draw on all or part of their funds by writing a draft.
Interest earnings in the Alliance Account are compounded daily and credited
monthly. Proceeds placed in the Alliance Account can be transferred to other
modes of settlement at any time. The proceeds contained in the Alliance Account
are part of Prudential's general account.

The Participant or the beneficiary may arrange with Prudential for the Death
Benefit to be paid in another mode of settlement other than the payment options
listed above. The following settlement options can be selected by the
Participant or the beneficiary if the Death Benefit is $1,000 or more. More than
one option can be selected.

OPTION 1: PAYMENTS FOR A FIXED PERIOD

The Death Benefit plus interest is paid over a fixed number of years
(1 - 25). The payment may be received monthly, quarterly, semi-annually or
annually. The payment amount will be higher or lower depending on the
period selected.

The interest rate can change, but will not be less than the guaranteed rate
shown in the claim settlement certificate that a Participant or beneficiary
will receive. The Participant or beneficiary may withdraw the total present
value of payments not yet made at any time.

OPTION 2: PAYMENTS IN INSTALLMENTS FOR LIFE

The Death Benefit provides monthly payments in installments for as long as
the beneficiary lives. The beneficiary may choose a guaranteed minimum
payment period (5, 10 or 20 years) or an installment refund, which will
guarantee that the sum of the payments equals the amount of the Death
Benefit payable under this option. If the beneficiary dies before
Prudential has made all guaranteed payments, Prudential will pay the
present value of the remaining guaranteed payments to a payee the
beneficiary designated.

OPTION 3: INTEREST INCOME

The Death Benefit remains with Prudential and earns interest. This option
allows the Participant or beneficiary to leave the Death Benefit with
Prudential and choose another settlement option at a later time.
Withdrawals of $100 or more (including the entire unpaid Death Benefit) can
be made at any time. The interest income payment may be received monthly,
quarterly, semi-annually or annually.

The interest rate can change, but will not be less than the guaranteed rate
shown in the claim settlement certificate that a Participant or beneficiary
will receive.

OPTION 4: PAYMENTS OF A FIXED AMOUNT

The Participant or beneficiary receives a guaranteed specified sum for a
limited number of years. This guaranteed specified sum represents a return
of the principal (Death Benefit) and interest paid over the selected number
of years. The payment may be received monthly, quarterly, semi-annually or
annually.

The interest rate can change, but will not be less than the guaranteed rate
shown in the claim settlement certificate that a Participant or beneficiary
will receive. Any interest credited will be used to extend the payment
period.

OPTION 5: CERTIFICATE OF DEPOSIT

The Death Benefit is used to purchase a certificate of deposit that is
issued by The Prudential Bank. Certificates of Deposit (CDs) are
investments that allow a Participant or beneficiary to choose a variety of
short- and long-term deposit options. They are designed to pay interest
monthly, quarterly, semi-annually, annually or at maturity. Interest rates
are guaranteed for the term of the CD. There is generally a $10,000 minimum
amount for this option.

Under each of the above options, each payment must generally be at least $20.

A beneficiary life claim guide is available upon request. This guide explains in
more detail the modes of payment and settlement options that are available.

<PAGE>

CHANGES IN FACE AMOUNT

Some Group Contracts may allow Participants to elect to increase the Face Amount
of their insurance at certain times. Other Group Contracts may provide for
increasing Face Amounts based on factors such as salary increases. Additional
underwriting requirements may have to be satisfied in either case. An increase
in the Face Amount will result in higher insurance charges because the net
amount at risk for Prudential will increase.

Some Group Contracts may also permit Participants to decrease the Face Amount of
their insurance at certain times. In no event, however, may the Face Amount be
decreased below $10,000 or below the minimum amount required to maintain the
insurance's status as life insurance under the federal tax laws.

Under certain Group Contracts, there may be a retirement/age related adjustment
in the Participant's Face Amount. Under the retirement/age adjustment provision,
the Face Amount is adjusted at a predetermined age or qualifying event
("triggering event") to an amount equal to five times the then-existing value of
the Certificate Fund. However, in no event will the adjusted Face Amount exceed
the then-existing Face Amount or be less than $25,000. This adjustment in the
Face Amount occurs at the latest of retirement, age 70, or the tenth Certificate
Anniversary. For Portable Certificates and Certificates issued under the
Dependent Benefits Life coverage, the adjustment will occur at the latest of age
70 or the tenth Certificate Anniversary. The retirement/age adjustment to the
Participant's Face Amount will be determined as of the end of the Valuation
Period in which the triggering event occurs but the actual adjustment to the
Participant's Face Amount will be effective the first contract Monthiversary
following this determination.

An increase or decrease in Face Amount, or the addition or removal of certain
additional insurance benefits, may create the potential for the insurance to be
treated as a Modified Endowment Contract under the Internal Revenue Code. This
is particularly true of decreases in Face Amount during the first seven years
that insurance is in force. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.
In addition, a decrease in coverage may limit the amount of premiums that a
Participant may contribute in the future.

CHARGES AND EXPENSES

The maximum deductions and charges described below will not be increased by
Prudential with respect to any Certificate in effect regardless of any changes
in mortality and expense experience. Where current charges are lower than
maximum charges, Prudential reserves the right to increase the current charges,
although it has no present intention to do so. Participants should refer to
their particular Group Contract and Certificate for further information on
applicable charges.

CHARGES DEDUCTED FROM PREMIUMS. The following charges are deducted from premium
payments before they are invested in the Separate Account or the Fixed Account.

1. Charges for Taxes Attributable to Premiums. A charge for taxes attributable
to premiums is deducted from each premium payment. For these purposes,
"taxes attributable to premiums" shall include any federal, state or local
income, premium, excise, business or any other type of tax (or component
thereof) measured by or based on the amount of premium received by
Prudential. That charge is currently made up of two parts. The first part
is for state and local premium taxes and is currently equal to 2.25% of the
premium received by Prudential. For certain Group Contracts, the charge may
equal up to 5%. The second part is for federal income taxes measured by
premiums and is currently equal to 0.35% of premiums received. Prudential
believes that this second charge is a reasonable estimate of the increased
cost for premium-based federal income taxes resulting from a 1990 change in
the Internal Revenue Code. These charges may be increased if the cost of
Prudential's taxes related to premium payments are increased.

2. Processing Fee. A charge of up to $2 may be deducted from each premium
payment from a Participant to cover the costs of collecting and processing
premiums. This charge may be reduced or eliminated on certain Group
Contracts. See REDUCTION OF CHARGES, page 30.

3. Sales Charge. A sales charge may be deducted to pay part of the costs
Prudential incurs in selling the Group Contract and the coverage under the
Group Contract, including commissions, advertising and the printing and
distribution of prospectuses and sales literature. The maximum charge is
equal to 3.5% of each premium payment. This charge may be reduced or
eliminated on certain Group Contracts. See REDUCTION IN CHARGES, page 30.

MONTHLY CERTIFICATE FUND CHARGES. The following charges are deducted monthly
from the Certificate Fund, pro-rata from each Subaccount and the Fixed Account.
Monthly Certificate Fund charges will generally be processed on

<PAGE>

the Monthiversary. However, under certain Group Contracts, monthly Certificate
Fund charges for a particular Monthiversary may be made when premiums are
received by Prudential (or its designated agent) from the Contractholder. Under
no Group Contract, however, will the monthly Certificate Fund charges for any
given Monthiversary be deducted later than 45 days past the applicable
Monthiversary.

1. Cost of Insurance. On each contract Monthiversary, Prudential will deduct a
charge for the cost of the Participant's insurance. When a Covered Person
dies, the amount paid to the beneficiary is generally larger than the
Certificate Fund. The cost of insurance charges are designed to enable
Prudential to pay this larger Death Benefit. The charge is determined by
multiplying the "net amount at risk" under a Certificate (the amount by
which the Certificate's Death Benefit, computed as if there was no
Certificate Debt, exceeds the Certificate Fund) by the cost of insurance
rate applicable to the Covered Person. The cost of insurance rates are
based on the age and rate class of the Covered Person, mortality
characteristics of the group, and particular aspects of the Group Contract,
such as the rate class structure and portability of the coverage. Separate
cost of insurance rates may apply to Certificates continued on a Portable
basis. Since the cost of insurance rate applicable under a Certificate
increases as the Covered Person ages, the monthly cost of insurance charge
deducted from the Certificate Fund will increase as the Covered Person
ages, and this increased charge will be reflected in the Cash Surrender
Value and Death Benefit under a Certificate.

Under some Group Contracts, any additional insurance benefits provided may
be taken into account in determining the cost of insurance rates. The rate
classes for a particular Group Contract may include classes for smokers and
nonsmokers, active and retired Participants, Portable Certificates, and
other criteria agreed to by Prudential and the Contractholder.

The actual cost of insurance rates will be set by Prudential based on its
expectations as to future experience in mortality and total expenses
(including, in some instances, those for additional insurance benefits) and
may be adjusted periodically, based on a number of factors including the
number of Certificates in force, the number of Certificates surrendered or
becoming Portable and the actual and anticipated mortality and expense
experience of the group. The expense experience considered by Prudential in
this regard includes whether a Group Contract sponsor or a party acting on
the sponsor's behalf performs administrative or other services related to
the Certificates and the extent to which the sponsor may receive
compensation for its services. Any change in the cost of insurance rates
will apply to all persons of the same age, rate class, and group.
Certificates continued on a Portable basis may be considered a separate
group. The cost of insurance rate applicable to a Participant may not,
however, be greater than the guaranteed cost of insurance rate set forth in
his or her Certificate. That guaranteed rate will be no higher than a rate
based upon 150% of the 1980 CSO Table. The maximum guaranteed rates are
150% of the 1980 CSO Table because Prudential uses simplified underwriting
and guaranteed issue procedures that may not require a medical examination
of a prospective Covered Person and may provide coverage to groups with
substandard risk characteristics from an underwriting standpoint. The
current cost of insurance charges are generally lower than 100% of the 1980
CSO Table.

2. Charge for Additional Insurance Benefits. Under certain Group Contracts,
Participants may obtain certain additional insurance benefits. See
ADDITIONAL INSURANCE BENEFITS, page 39. Where such additional insurance
benefits are not taken into account in determining the cost of insurance
charge as discussed above, a separate charge for any such additional
insurance benefits obtained under a Certificate will be deducted each
Monthiversary from the Participant's Certificate Fund.

3. Administrative Charge. An administrative charge may be deducted on each
contract Monthiversary. It is intended to pay for maintaining records, and
communicating with Contractholders and Participants. It is currently not
more than $3 per month and is guaranteed not to exceed $6 per month. This
charge may be reduced or eliminated on certain Group Contracts. See
REDUCTION OF CHARGES, page 30.

4. Other Taxes. Prudential reserves the right to deduct a charge to cover
federal, state or local taxes (other than "taxes attributable to premiums"
described above) that are imposed upon the operations of the Separate
Account. Currently, no such charges are made.

DAILY DEDUCTION FROM THE SUBACCOUNTS OF THE SEPARATE ACCOUNT. Each day a charge
is deducted from the assets of each of the Subaccounts in an amount currently
equal to an effective annual rate of 0.45%. The charge is guaranteed not to
exceed an effective annual rate of 0.90%. This charge is intended to compensate
Prudential for assuming the mortality and expense risks of the insurance
provided through the Group Contract. The mortality risk assumed is that Covered
Persons may live for shorter periods of time than Prudential estimated when it
determined the mortality charge. The expense risk assumed is that expenses
incurred in issuing and administering the insurance will be greater than
Prudential estimated in fixing its administrative charges. Prudential will
realize

<PAGE>

a profit from this risk charge to the extent it is not needed to provide
benefits and pay expenses under the Certificates. This charge is not assessed on
amounts allocated to the Fixed Account.

TRANSACTION CHARGES. There may be charges associated with surrenders, partial
withdrawals, loans, transfers and additional statement requests. These charges
are described in the prospectus section dealing with the transaction itself.

EXPENSES INCURRED BY THE FUNDS. The charges and expenses of the Funds are
indirectly borne by the Participants. Details about investment management fees
and other underlying fund expenses are provided in the fee table and in the
accompanying prospectuses for the available Funds and the related statements of
additional information.

REDUCTION OF CHARGES

Prudential may reduce or waive the sales charges, processing fee, and/or other
charges under certain Group Contracts, where it is expected that the Group
Contract will involve reduced sales or administrative expenses. Prudential
determines both the eligibility for such reduced or waived charges, as well as
the amount of such reductions, by considering the following factors: (1) the
size of the group; (2) the total amount of premium payments expected to be
received; (3) the expected persistency of the individual Certificates; (4) the
purpose for which the Group Contract is purchased and whether that purpose makes
it likely that expenses will be reduced; and (5) any other circumstances which
Prudential believes to be relevant in determining whether reduced sales or
administrative expenses may be expected. Some of the reductions in or waivers of
charges for cases may be contractually guaranteed; other reductions or waivers
may be discontinued or modified by Prudential. Prudential's reductions in, or
waivers of, charges for these cases will not be unfairly discriminatory to the
interests of any individual Participants.

DIVIDENDS/EXPERIENCE CREDITS

Because the Group Contract is issued by Prudential, a mutual life insurance
company, it is a participating contract. This means it is eligible to be
credited with part of Prudential's divisible surplus attributable to the Group
Contract ("Dividends"), or a refund based on the experience of the case
("Experience Credits"), as determined annually by Prudential's Board of
Directors. Most of these Group Contracts are expected to be priced such that
there will be no source of distributable surplus attributable to these Group
Contracts and no refunds based on experience. Prudential may, however, issue
these Group Contracts in certain cases on terms such that Dividends or
Experience Credits may be declared.

The method of distribution of any Dividends or Experience Credits may vary
depending on the terms of a particular Group Contract. Dividends or Experience
Credits that are reinvested as premiums will be subject to the charges made for
premium payments. If an individual Participant becomes a Portable Certificate
holder, he or she will no longer be entitled to receive any Dividends or
Experience Credits under the Group Contract.

Participants should refer to their Group Contract for details on Dividends or
Experience Credits.

CASH SURRENDER VALUE

The Cash Surrender Value of the Certificate is equal to the Participant's
Certificate Fund, reduced by any Certificate Debt, outstanding charges, and any
applicable transaction charge. The Certificate Fund on any day equals the sum of
the amounts in the Subaccounts, the amount invested in the Fixed Account, and
the Loan Account. See LOANS, page 31. The Cash Surrender Value will change
daily, reflecting the Net Premiums paid, withdrawals made, the increases or
decreases in the value of the Fund shares in which the assets of the Subaccounts
have been invested, interest credited on any amounts allocated to the Fixed
Account and on the Loan Account, interest accrued on any loan, and by the daily
asset charge for mortality and expense risks assessed against the variable
investment options. The Cash Surrender Value will also reflect monthly charges.
Upon request, Prudential (or Prudential's designated agent) will inform a
Participant as to the Cash Surrender Value of his or her Certificate. There is
no guaranteed minimum Cash Surrender Value and it is possible for the Cash
Surrender Value of a Certificate to decline to zero.

The tables on pages T-1 and T-2 of this prospectus illustrate approximately what
the Cash Surrender Values would be for selected Certificates with the specified
premium payments (assuming uniform hypothetical investment results in the
selected Subaccount portfolios).

<PAGE>

FULL SURRENDERS

A Participant may surrender his or her Certificate for its Cash Surrender Value
at any time. All insurance will end at this time. Prudential will pay the Cash
Surrender Value calculated as of the end of the Valuation Period during which
Prudential (or Prudential's designated agent) receives the Participant's request
on a form approved by Prudential and the proceeds will be paid as described in
WHEN PROCEEDS ARE PAID, page 37. Under certain Group Contracts, there may be a
transaction charge of up to the lesser of $20 or 2% of the amount received upon
surrender. A surrender may have tax consequences. See TAX TREATMENT OF
CERTIFICATE BENEFITS, page 35.

ELECTION OF PAID-UP INSURANCE

At any time, a Participant may elect to exchange his/her existing Group Variable
Universal Life insurance coverage for fixed paid-up insurance on the life of the
Covered Person with all or part of the Cash Surrender Value. The minimum amount
of Cash Surrender Value that a Participant can transfer in such an exchange is
$1,000. Under certain Group Contracts, a transaction charge of up to $20 may be
made in connection with the exchange.

The paid-up insurance amount cannot be more than can be exchanged using the
Certificate's Cash Surrender Value or more than the Death Benefit under the
Certificate at the time the exchange is made. Once the exchange is made,
Prudential may reduce any future amount of coverage for which the Participant is
eligible under the Group Contract.

An exchange is effective as of the end of the Valuation Period during which
Prudential (or its designated agent) receives the Participant's request on a
form approved by Prudential. Once an exchange occurs, all coverages provided by
the Certificate will end, including additional insurance benefits, if any.

An exchange may result in the paid-up insurance becoming a Modified Endowment
Contract. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

Any amounts not used in an exchange will be withdrawn from the Certificate Fund
as of the end of the Valuation Period when the exchange was effective, and the
proceeds will be paid as described in WHEN PROCEEDS ARE PAID, page 37. A
withdrawal of a portion of the Cash Surrender Value of a Certificate may have
tax consequences. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

PARTIAL WITHDRAWALS

A Participant may withdraw a portion of the Cash Surrender Value of his or her
Certificate during the lifetime of the Covered Person and while the Certificate
is not in default. When a partial withdrawal is made, an amount equal to the
withdrawal will be taken out of each of the Participant's investment options on
a pro-rata basis unless the Participant selects specific investment options.
Such partial withdrawals will be effected as of the end of the Valuation Period
during which Prudential (or Prudential's designated agent) receives the
Participant's request on a form approved by Prudential, and the proceeds will be
paid as described in WHEN PROCEEDS ARE PAID, page 37. Under certain Group
Contracts, there is no limit on the number of partial withdrawals a Participant
can take each year, but there may be a transaction charge for each withdrawal of
up to the lesser of $20 or 2% of the amount of the withdrawal. This transaction
charge will be deducted from the amount withdrawn from the Certificate Fund. A
withdrawal of a portion of the Cash Surrender Value of a Certificate may have
tax consequences. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

The minimum amount of any partial withdrawal is $200. The maximum amount of any
partial withdrawal is the amount that would reduce the Certificate Fund (less
any Certificate Debt and outstanding charges) to an amount equal to the next
month's charges. Any withdrawal greater than that amount will not be permitted
because it would cause the Certificate to default. Upon request, Prudential (or
Prudential's designated agent) will inform a Certificate owner how much Cash
Surrender Value may be withdrawn.

An amount withdrawn may not be repaid except as a premium payment subject to
applicable charges.

LOANS

A Participant may borrow up to the Loan Value of the Certificate from
Prudential. The Loan Value of a Certificate (before any applicable transaction
charge) at any time is determined by multiplying the Certificate Fund by 90% (or
higher where required by state law) and then subtracting any existing loan with
accrued interest, outstanding charges, and the amount of the next month's
charges. The minimum amount that may be borrowed at any one time is $200. A loan
will not be permitted if Certificate Debt exceeds the Loan Value. Under certain
Group

<PAGE>

Contracts, there may be a transaction charge up to $20 for each loan made. Loan
proceeds will be paid as described in WHEN PROCEEDS ARE PAID, page 37.

Interest charged on any loan will accrue daily at an annual rate determined each
year by Prudential. Interest payments on any loan are due at the end of each
contract year. If interest is not paid when due, it will be added to the
principal amount of the loan. Prudential will notify a Participant 31 days
before the interest on the loan becomes due.

When a loan is made, an amount equal to the loan will be taken out of each of
the Participant's investment options on a pro-rata basis unless the Participant
selects specific investment options. At the same time, a Loan Account will be
started for the Participant and will be credited with an amount equal to the
loan. Prudential will generally credit interest to the amount in the Loan
Account at an annual rate of 2% less than the interest rate on the loan.
The crediting rate will generally be equal to the Fixed Account crediting rate.

A Participant may repay a part or all of the loan at any time. Loans may be
repaid by payment or by withdrawing amounts from the Certificate Fund.
Participants should designate whether a payment is intended as a premium payment
or as a loan repayment. If no such designation is made, the payment will be
treated as a loan repayment. If a loan is repaid by using the Certificate Fund,
Prudential will treat such repayment as a partial withdrawal from the
Certificate Fund and under certain Group Contracts, there may be a transaction
charge of up to the lesser of $20 or 2% of the amount of the withdrawal. A
partial withdrawal from the Certificate Fund may have tax consequences. See TAX
TREATMENT OF CERTIFICATE BENEFITS, page 35. The balance in a Participant's Loan
Account will be reduced by the amount of any loan repayment.

A Participant's Loan Account plus accrued interest ("Certificate Debt") may not
exceed the value of the Certificate Fund. If the Certificate Debt equals this
amount the Certificate will go into default. See LAPSE page 33.

If Certificate Debt is still outstanding when the Certificate is surrendered or
allowed to lapse, the borrowed amount may become taxable. In addition, loans
from Modified Endowment Contracts may be treated for tax purposes as
distributions of income. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

Should a Death Benefit become payable while a loan is outstanding, or should the
Certificate be surrendered while a loan is outstanding, any proceeds otherwise
payable will be reduced to reflect the amount of the loan and any accrued
interest.

A loan will have a permanent effect on a Certificate's Cash Surrender Value and
may have a permanent effect on the Death Benefit. This is because the investment
results of the selected investment options will apply only to the amount
remaining in those investment options after the loan amount is transferred to
the Loan Account. The longer the loan is outstanding, the greater the effect is
likely to be. The effect could be favorable or unfavorable. If investment
results are greater than the rate being credited upon the amount of the loan
while the loan is outstanding, Cash Surrender Values will not be as high as they
would have been if no loan had been made.

CERTIFICATE EXCHANGE PRIVILEGE

During the first 24 months following the issuance of a Certificate, the
Participant may exercise the Certificate exchange privilege, which entails the
exchange of the existing Group Variable Universal Life insurance coverage for a
flexible premium fixed benefit life insurance coverage. An exchange results in
the transfer of funds from the Separate Account to Prudential's general account.
The exchange is effective as of the end of the Valuation Period during which
Prudential receives the Participant's request on a form approved by Prudential.
The Certificate acquired in the exchange will have the same Issue Age as the
original Certificate. No evidence of insurability is required to effect such an
exchange.

No transaction charge is currently imposed with respect to this exchange
privilege. However, Prudential reserves the right to impose such a transaction
charge in the future.

The Participant may also exercise the Certificate exchange privilege once during
the first 24 months following the effective date of an increase in the Face
Amount of a Certificate only for the amount of coverage that was increased. See
TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

TELEPHONE AND ELECTRONIC TRANSACTIONS

Some Group Contracts permit a Participant to transfer amounts among available
investment options, make surrenders and partial withdrawals, and obtain loans by
telephone or electronically provided he or she is enrolled to use Prudential's
telephone or electronic transfer system. Prudential will not be liable for
following instructions communicated by telephone or electronically that it
reasonably believes to be genuine. It has adopted security

<PAGE>

procedures reasonably designed to verify that such communications are genuine.
Prudential cannot guarantee that Participants will be able to get through to
complete a telephone or electronic transaction during peak periods such as
periods of drastic economic or market change or during system failures or power
outages.

LAPSE

In general, a Certificate will remain in force so long as the balance in the
Certificate Fund less Certificate Debt and outstanding charges is sufficient to
pay the monthly charges when due. If it is not, the Participant's insurance is
in default and will lapse if a grace period expires without a sufficient payment
being made. Certain Group Contracts may provide that if a Participant pays
certain specified premiums during the first two Certificate Years, the
Certificate will not go into default even if the Certificate Fund is
insufficient to cover monthly charges. Participants should refer to their
particular Certificates for the details of this default protection. A
Certificate that lapses with Certificate Debt may result in tax consequences.
See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

Prudential will send a notice to a Participant in default at the last known
address on file with Prudential (or to Prudential's designated agent) specifying
the amount of premium required to keep the Certificate in force and the date the
payment is due. The grace period expires on the later of 61 days from the date
of default or 30 days from the date notice was mailed. If Prudential (or
Prudential's designated agent) does not receive the required premium payment
within the grace period, the Participant's insurance will lapse and have no
remaining value.

If the Covered Person dies during the grace period, the Death Benefit will be
reduced by any past due monthly charges and any Certificate Debt.

TERMINATION OF A CONTRACTHOLDER'S PARTICIPATION IN GROUP CONTRACTS

The Contractholder may decide to terminate the Group Contract with Prudential.
In addition, Prudential may terminate the Group Contract if the aggregate Face
Amount of all Certificates and/or the number of Certificates issued under the
Group Contract falls below the minimum permissible levels established by
Prudential or the Contractholder or its agent fails to timely remit premiums to
Prudential.

The party terminating participation in the Group Contract must provide ninety
days written notice to the other party, as well as to all Participants, before
terminating participation in the Group Contract. Termination of participation in
the Group Contract means that the Contractholder or its agent will no longer
remit premiums to Prudential under the Group Contract and that no new
Certificates will be issued under the Group Contract. The effects on
Participants of termination of the Contractholder's participation in the Group
Contract are described in OPTIONS ON TERMINATION OF COVERAGE, below. The options
available to Participants from Prudential may depend on what other insurance
options are available to them. The Participant should refer to the Group
Contract and Certificate for further details on termination of coverage.

PARTICIPANTS WHO ARE NO LONGER ELIGIBLE GROUP MEMBERS

The terms of each Group Contract will determine the effect on a Participant's
insurance coverage if the Participant is no longer an Eligible Group Member.
Some Group Contracts may provide that insurance coverage will continue even if
the Participant is no longer an eligible member of the group. Under such Group
Contracts, within 61 days after the Participant is no longer eligible under the
Group Contract, Prudential will notify the Participant that Prudential will now
mail periodic premium reminders directly to the Participant, who will remit
premium payments directly to Prudential or authorize Prudential to receive
payment using electronic form transfers or credit/debit cards. Continuation of
insurance may be subject to certain conditions and limitations specified in the
Group Contract. The notice will also explain the Participant charges and
expenses applicable to Portable Certificates. See CHARGES AND EXPENSES, page 28.
These charges and expenses may be higher than those paid by the Participant
while he or she was still an Eligible Group Member, but will not exceed the
maximum charges and expenses described in this prospectus. Continuation as a
Portable Certificate holder may be conditioned on maintenance of a specified
minimum Certificate Fund value.

Under other Group Contracts, the portability privileges described above will not
be available. Participants under those Group Contracts will have the options
described in the next section of this prospectus.

OPTIONS ON TERMINATION OF COVERAGE

Insurance coverage obtained through a Group Contract will terminate when the
Group Contract itself terminates. Some Group Contracts also provide that
coverage purchased by an individual Participant will terminate when the
Participant is no longer an Eligible Group Member.

<PAGE>

When the Contractholder's participation in the Group Contract terminates, the
effect on individual Participants depends on whether the Contractholder replaces
the Group Contract with another life insurance contract(s) that provides for
accumulation of cash value. In general, if the Contractholder does enter into
such a contract, Certificates will be terminated and the Cash Surrender Value of
each such Certificate will be directly transferred to the new contract unless
the Participant elects to receive the Cash Surrender Value of the Certificate.
Some Group Contracts may, however, provide that Certificates can continue on a
Portable basis unless the Participant elects to transfer the Cash Surrender
Value to the new life insurance contract or to surrender the Certificate.
Certain conditions and limitations may apply and are specified in the Group
Contract. Participants should consult the Group Contract and Certificate
concerning issuance of Portable Certificates in these circumstances.

If the Contractholder does not enter into a new life insurance contract(s) that
provides for accumulation of cash value, Participants will have the following
options and may also have the option of a Portable Certificate if the Group
Contract so provides. Participants who are no longer Eligible Group Members will
also have the following options under Group Contracts that do not provide for
issuance of Portable Certificates to such persons.

CONVERSION. A Participant may elect to convert the Certificate to an individual
life insurance policy without showing evidence of insurability. If a Participant
elects this option, he or she must apply for the individual contract and pay the
first premium within 31 days after the coverage under the Group Contract ends.
The Participant may select any form of individual life insurance (other than
term insurance) that Prudential normally makes available to insureds who are the
same age and requesting the same amount of insurance provided that the
Participant has been insured for at least five years (or less under certain
Group Contracts) under the Group Contract and any other Prudential rider or
Group Contract replaced by this insurance. Premiums will be based on the form
and amount of insurance elected by the Participant, as well as the Covered
Person's risk class and age.

If the insurance is ending because the Participant is no longer eligible to
participate in the Group Contract, the amount of insurance under the individual
policy cannot be more than the Face Amount of the Certificate under the Group
Contract. If the insurance is ending because the Group Contract is terminating,
the amount of individual insurance may, depending on applicable state law, be
limited to the lesser of (1) $10,000 or (2) the Face Amount of the Certificate
under the Group Contract less the amount of any group insurance the Participant
becomes eligible for in the next 45 days.

If a Covered Person dies within 31 days after the insurance ends under the Group
Contract, and the Participant had the right to convert to an individual policy,
a Death Benefit equal to the amount of individual insurance on the Covered
Person the Participant could have purchased upon conversion will be payable by
Prudential.

PAID-UP INSURANCE. The Participant may elect to purchase fixed paid-up insurance
on the Covered Person with the Cash Surrender Value of the Certificate. The
Participant must have at least $1,000 of Cash Surrender Value for this option to
be available. The insurance amount will depend on the Cash Surrender Value on
the date of termination and the age of the Covered Person but cannot exceed the
Death Benefit immediately before the paid-up purchase. The Participant must
elect this option within 61 days of the date on which the Certificate coverage
would end. The election is effective as of the end of the Valuation Period
during which Prudential (or its designated agent) receives the Participant's
request on a form approved by Prudential. Acquisition of reduced paid-up
insurance may result in that insurance becoming a Modified Endowment Contract.
See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

PAYMENT OF CASH SURRENDER VALUE. The Participant may receive the Cash Surrender
Value by surrendering the Certificate and making a proper request on a form
approved by Prudential.

The above options apply whether the Participant or a spouse is the Covered
Person under the Certificate. A Participant who does not choose any of the above
options within 61 days of the date on which Certificate coverage would end will
be provided with Paid-Up Insurance, if his or her Certificate has at least
$1,000 of Cash Surrender Value and, if not, will be paid the Cash Surrender
Value.

REINSTATEMENT

Except as indicated in the next sentence, a lapsed Certificate may be reinstated
at any time within 3 years after the end of the grace period and before the
Participant reaches the maximum age at which a Certificate may be held. A lapsed
Certificate may not be reinstated if the Group Contract is terminated and the
Participant would not have been permitted to retain the Certificate on a
portable basis. To reinstate coverage, a Participant must submit the following
items to Prudential (or Prudential's designated agent): (1) a written request
for reinstatement; (2) evidence of insurability satisfactory to Prudential; and
(3) a premium payment (less any applicable charges) that is at least equal to
the monthly Certificate Fund charges for the grace period plus the monthly
Certificate Fund charges for two months. See CHARGES AND EXPENSES, page 28.

<PAGE>

The reinstatement is effective on the Monthiversary following the date
Prudential approves the request. The terms of the original Certificate will
apply to the reinstated Certificate. A reinstated Certificate is subject to a
new two year incontestability period and a new suicide exclusion period. All
Certificate Debt is retired at the same time the Certificate lapses and will not
be reestablished.

No transaction charge is currently imposed in connection with a reinstatement,
although Prudential reserves the right to impose such a transaction charge in
the future.

TAX TREATMENT OF CERTIFICATE BENEFITS

Each prospective Participant is urged to consult a qualified tax advisor. The
following discussion is not intended as tax advice, and it is not a complete
statement of what the effect of federal income taxes will be under all
circumstances. Rather, it provides information about how Prudential believes the
federal income tax laws apply in the most commonly occurring circumstances.
There is no guarantee, however, that the current federal income tax laws and
regulations or interpretations will not change.

TREATMENT AS LIFE INSURANCE AND INVESTOR CONTROL. The Certificate will be
treated as "life insurance," as long as it satisfies certain definitional tests
set forth in section 7702 of the Internal Revenue Code (the "Code") and as long
as the underlying investments for the Certificate satisfy diversification
requirements under section 817(h) of the Code. For further detail on
diversification requirements, see the applicable Fund prospectuses.

Prudential believes that it has taken adequate steps under the Code and existing
regulations under it to cause the Certificates to be treated as life insurance
for tax purposes. This means that: (1) except as noted below, the Participant
should not be taxed on any part of the Certificate Fund, including additions
attributable to interest, dividends, or appreciation; and (2) the Death Benefit
should be excludable from the gross income of the beneficiary under section
101(a) of the Code.

Although Prudential believes the Certificate should qualify as "life insurance"
for federal tax purposes, there are uncertainties. Section 7702 of the Code
which defines life insurance for tax purposes gives the Secretary of the
Treasury authority to prescribe regulations to carry out the purposes of the
Section. In this regard, proposed regulations governing mortality charges were
issued in 1991 and proposed regulations under Sections 101, 7702 and 7702A
governing the treatment of life insurance policies that provide accelerated
death benefits were issued in 1992. None of these proposed regulations has yet
been finalized. Additional regulations under Section 7702 may also be
promulgated in the future.

Moreover, IRS regulations issued to date do not provide guidance concerning the
extent to which Participants may direct their investments to the particular
available Subaccounts of a Separate Account without causing the Participants
instead of Prudential to be considered the owners of the underlying assets. Such
guidance will be included in regulations or revenue rulings under Section 817(d)
relating to the definition of a variable contract. The ownership rights under
the Certificate are similar to, but different in certain respects from, those
addressed by the IRS in Rulings in which it was determined that contract owners
were not owners of separate account assets. For example, a Contractholder may
select the investment strategies, Participants have the choice of more Funds,
including Funds with similar broad investment strategies and different
investment managers, and Participants may be able to reallocate amounts between
available Subaccounts more frequently than in such Rulings. While Prudential
believes it will be considered the owner of the Separate Account assets, these
differences could result in the Participant being considered the owner of the
assets.

Prudential intends to comply with final regulations issued under Sections 7702
and 817. Therefore, because of this uncertainty, it reserves the right to make
such changes as it deems necessary to assure that the Group Contract continues
to qualify as variable life insurance for tax purposes. Any such changes will
apply uniformly to affected Participants and will be made only after advance
written notice to the Contractholder.

PRE-DEATH DISTRIBUTIONS. The taxation of pre-death distributions depends on
whether the Certificate is classified as a Modified Endowment Contract. The
following discussion first deals with distributions under Certificates not so
classified, and then with Modified Endowment Contracts.

1. A surrender or lapse of the Certificate may have tax consequences.
Under surrender, the Participant will not be taxed on the Cash
Surrender Value except for the amount, if any, that exceeds the gross
premiums paid less the untaxed portion of any prior withdrawals. The
amount of any unpaid Certificate Debt will, upon surrender or lapse,
be added to the Cash Surrender Value and treated, for this purpose, as
if it had been received. Any loss incurred upon surrender is generally
not deductible.

A withdrawal generally is not taxable unless it exceeds total premiums
paid to the date of withdrawal less the untaxed portion of any prior
withdrawals. However, under certain limited circumstances, in the
first 15

<PAGE>

Certificate Years all or a portion of a withdrawal may be taxable if
the Certificate Fund exceeds the total premiums paid less the untaxed
portions of any prior withdrawals, even if total withdrawals do not
exceed total premiums paid to date.

Extra premiums for additional insurance benefits generally do not
count in computing gross premiums paid, which in turn determines the
extent to which a withdrawal might be taxed.

Loans received under the Certificate will ordinarily be treated as
indebtedness of the Participant and will not be considered to be
distributions subject to tax. However, if a loan is still outstanding
when the Certificate is surrendered or allowed to lapse, the
outstanding Certificate Debt will be taxable at that time to the
extent the Cash Surrender Value exceeds gross premiums paid less the
untaxed portion of any prior withdrawals.

2. Some of the above rules are changed if the Certificate is classified
as a Modified Endowment Contract under Section 7702A of the Code. It
is possible for the Certificate to be classified as a Modified
Endowment Contract under at least two circumstances: premiums in
excess of the 7 pay premiums allowed under Section 7702A are paid or a
decrease in the Death Benefit or a removal of certain additional
insurance benefits is made during the first 7 Certificate Years.
Moreover, the addition of certain additional insurance benefits (or an
increase in the Death Benefit) after the Certificate Date may have an
impact on the Certificate's status as a Modified Endowment Contract.
Participants contemplating any of these steps should first consult a
qualified tax advisor and their Prudential representative.

If the Certificate is classified as a Modified Endowment Contract,
then pre-death distributions, including loans, assignments and pledges
are includible in income to the extent that the Certificate Fund
exceeds the gross premiums paid for the Certificate increased by the
amount of any loans previously includible in income and reduced by any
untaxed amounts previously received other than the amount of any loans
excludible from income. These rules may also apply to pre-death
distributions, including loans, made during the two year period prior
to the Certificate becoming a Modified Endowment Contract.

In addition, pre-death distributions from such Certificates (including
full surrenders) will be subject to a penalty of 10 percent of the
amount includible in income unless the amount is distributed on or
after age 59 1/2, on account of the taxpayer's disability or as a life
annuity. It is presently unclear how the penalty tax provisions apply
to contracts owned by non-natural persons such as trusts.

Under certain circumstances, multiple Modified Endowment Contracts
issued to the same Participant during any calendar year will be
treated as a single contract for purposes of applying the above rules.

Any Dividends or Experience Credits (to the extent not redeposited in
the Certificate) will effectively reduce the gross premiums paid for
purposes of the above rules.

TREATMENT AS GROUP TERM LIFE INSURANCE. Section 79 of the Code and the
regulations thereunder provide for the treatment of certain life insurance as
group-term life insurance ("GTLI"). In most cases, employee-pay-all coverage
under the Group Contract will not qualify as GTLI or be deemed to be part of an
employer GTLI plan, and the Certificate will be treated the same as any
individually-purchased life insurance policy for tax purposes. However,
depending on the structure of the arrangement under which the Group Contract is
held, including other insurance plans offered by or through the employer, a
portion of the coverage under the Group Contract may qualify as group term life
insurance and, in addition, covered employees may be taxable on certain
increases in cash values under an IRS-prescribed formula.

WITHHOLDING. The taxable portion of any amounts received under the Certificate
will be subject to withholding to meet federal income tax obligations, if the
Participant fails to elect that no taxes be withheld. Prudential will provide
the Participant with forms and instructions concerning the right to elect that
no taxes be withheld from the taxable portion of any payment. All recipients may
be subject to penalties under the estimated tax payment rules if withholding and
estimated tax payments are not sufficient. Participants who do not provide a
social security number or other taxpayer identification number will not be
permitted to elect out of withholding. Special withholding rules apply to
payments to non-resident aliens.

OTHER TAX CONSIDERATIONS. Transfer of the Certificate to a new owner or
assignment of the Certificate may have tax consequences depending on the
circumstances. In the case of a transfer of the Certificate for valuable
consideration, the Death Benefit may be subject to federal income taxes under
Section 101(a)(2) of the Code. In addition, a transfer of the Certificate to or
the designation of a beneficiary who is either 37 1/2 years younger than the
Participant or a grandchild of the Participant may have Generation Skipping
Transfer tax consequences under Section 2601 of the Code.

<PAGE>

In certain circumstances, deductions for interest paid or accrued on Certificate
Debt or on other loans that are incurred or continued to purchase or carry the
Certificate may be denied under Sections 163 of the Code as personal interest or
under Section 264 of the Code. Participants should consult a qualified tax
advisor regarding the application of these provisions to their circumstances.

The individual situation of each Participant or beneficiary will determine the
federal estate taxes and the state and local estate, inheritance and other taxes
due if the Participant or insured dies.

The earnings of the Separate Account are taxed as part of the operations of
Prudential. Accordingly, the Separate Account does not intend to qualify as a
regulated investment company under the Code.

The Certificate Exchange Privilege, whereby a Participant may exchange the
existing Group Variable Universal Life Coverage for flexible premium fixed
benefit life insurance coverage, is tax free provided that cash is not
distributed to the Participant as part of the exchange and any existing loan is
carried over to the new coverage. Additionally, the exchange could limit the
amount of premiums that a Participant may pay without causing the Certificate to
become a Modified Endowment Contract.

ERISA CONSIDERATIONS

Employer involvement and other factors will determine whether a Group Contract
is subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). If applicable, ERISA imposes certain requirements, including
requirements on persons who are fiduciaries or "parties in interest" with
respect to employee benefit plans, and may prohibit certain transactions in
connection with a Group Contract, absent a statutory or administrative
exemption. Counsel and other competent advisors should be consulted to determine
whether ERISA will apply to an individual situation.

Administrative exemptions issued by the Department of Labor under ERISA permit
transactions (including the sale of insurance contracts like the Group Contract)
between insurance agents and employee benefit plans subject to ERISA. To be able
to rely upon such exemptions, certain information must be disclosed to the
fiduciary purchasing the insurance contract on behalf of the plan. The
information that must be disclosed includes: (1) the relationship between the
agent and the insurer; (2) a description of any charges, fees, discounts,
penalties or adjustments that may be imposed in connection with the purchase,
holding, exchange or termination of the Group Contract; and (3) the commissions
received by the agent. Information about any applicable charges, fees,
discounts, penalties or adjustments may be found under CHARGES AND EXPENSES,
commencing on page 28. Information about sales representatives and commissions
may be found under SALE OF THE CONTRACT AND SALES COMMISSIONS, on page 40.

Execution of a Group Contract by a Contractholder and an enrollment form by a
Participant will be deemed to be an acknowledgment of receipt of this
information and approval of transactions under the Group Contract.

WHEN PROCEEDS ARE PAID

Prudential will generally pay any Death Benefit, Cash Surrender Value, partial
withdrawal or loan proceeds supported by the Separate Account within 7 days
after receipt at the Prudential office specified in the Certificate or by
Prudential's designated agent of all the documents required for such a payment.
Other than the Death Benefit, which is determined as of the date of death, the
amount will be determined as of the end of the Valuation Period in which the
necessary documents are received in good order. However, Prudential may delay
payment of proceeds from the Subaccount(s) and the variable portion of the Death
Benefit due under a Participant's insurance if the disposal or valuation of the
Separate Account's assets is not reasonably practicable because the New York
Stock Exchange is closed for other than a regular holiday or weekend, trading is
restricted by the SEC, or the SEC declares that an emergency exists.

With respect to the amount of any Cash Surrender Value allocated to the Fixed
Account, and with respect to a Certificate in force as paid-up insurance,
Prudential expects to pay the Cash Surrender Value promptly upon request.
However, Prudential has the right to delay payment of such Cash Surrender Value
for up to six months (or a shorter period if required by applicable law).
Prudential will pay interest at the current Fixed Account rate, under the Group
Contract, if it delays such a payment for more than 30 days (or a shorter period
if required by applicable law).

BENEFICIARY

The Participant has the right to designate and name a beneficiary to receive
Death Benefits under the Certificate. The Participant must designate a
beneficiary on a form approved by Prudential. A Participant may change the
beneficiary at any time without the consent of the present beneficiary in
accordance with the terms of the Group

<PAGE>

Contract. If there is more than one beneficiary at the death of the Covered
Person, each will receive equal payments unless otherwise specified by the
Participant.

INCONTESTABILITY

After a Participant's Certificate has been in force during a Covered Person's
lifetime for two years or, with respect to any change in the Certificate that
requires Prudential's approval and could increase its liability, after the
change has been in effect during the insured's lifetime for two years from the
effective date of the change, Prudential will not contest its liability under
the Certificate in accordance with its terms.

MISSTATEMENT OF AGE

If a Covered Person's stated age is incorrect in the Certificate, Prudential
will adjust the Death Benefit payable, as required by law, to reflect the
correct age.

SUICIDE EXCLUSION

Generally, if a Covered Person, whether sane or insane, dies by suicide within
two years from the effective date of the Certificate, Prudential will pay no
more under the Certificate than the sum of the contributions paid less any
Certificate Debt, outstanding charges, and less any partial withdrawals.

If a Covered Person, whether sane or insane, dies by suicide within two years
from the effective date of an increase in the Face Amount of insurance that was
requested after issue and required approval, Prudential will pay, with respect
to the amount of the increase, no more than the sum of the monthly charges
attributable to the increase.

ASSIGNMENT

A Participant may assign the insurance coverage and all rights, benefits or
privileges that he or she has under a Certificate. Prudential will be bound by
an assignment of insurance or the rights, benefits or privileges under the
insurance only if: (1) it is in writing; (2) it is signed by the Participant;
and (3) Prudential receives a copy of the assignment at the Prudential office
specified in the Certificate or at the address of Prudential's designated agent.
Prudential is not responsible for determining the validity or legality of any
assignment. References in this prospectus to rights that a Participant may
exercise shall include exercise of such rights by any person to whom the
Participant has validly assigned such rights. Assignment of a Certificate that
is a Modified Endowment Contract could have adverse federal income tax
consequences. See TAX TREATMENT OF CERTIFICATE BENEFITS, page 35.

VOTING RIGHTS

As stated above, all of the assets held in the Subaccounts of the Separate
Account will be invested in shares of the corresponding portfolios of the Funds.
Prudential is the legal owner of those shares and as such has the right to vote
on any matter voted on at any shareholders meetings of the Funds. However,
Prudential will, as required by law, vote the shares of the Funds at any regular
and special shareholders meetings the Funds hold in accordance with voting
instructions received from Participants. A Fund may not hold annual shareholders
meetings when not required to do so under the laws of the state of its
incorporation or the Investment Company Act of 1940. Fund shares for which no
timely instructions from Participants are received, and any shares attributable
to general account investments of Prudential, will be voted in the same
proportion as shares in the respective portfolios for which instructions are
received. Should the applicable federal securities laws or regulations, or their
current interpretation, change so as to permit Prudential to vote shares of the
Funds in its own right, it may elect to do so.

Generally, a Participant may give voting instructions on matters that would be
changes in fundamental policies and any matter requiring a vote of the
shareholders of the Funds. With respect to approval of the investment advisory
agreement or any change in a portfolio's fundamental investment policy,
Participants participating in such portfolios will vote separately by portfolio
on the matter, pursuant to the requirements of Rule 18f-2 under the 1940 Act.

The number of Fund shares for which instructions may be given by a Participant
is determined by dividing the portion of the value of the Certificate Fund
derived from participation in a Subaccount, by the value of one share in the
corresponding portfolio of the applicable Fund. The number of votes for which
each Participant may give Prudential instructions will be determined as of the
record date chosen by the Board of the applicable Fund.

<PAGE>

Prudential will furnish Participants with proper forms and proxies to enable
them to give these instructions. Prudential reserves the right to modify the
manner in which the weight to be given voting instructions is calculated where
such a change is necessary to comply with current federal regulations or
interpretations of those regulations.

Prudential may, if required by state insurance regulations, disregard voting
instructions if such instructions would require shares to be voted so as to
cause a change in the sub-classification or investment objectives of one or more
of the Funds' portfolios, or to approve or disapprove an investment advisory
contract for a Fund. In addition, Prudential itself may disregard voting
instructions that would require changes in the investment policy or investment
advisor of one or more of the Funds' portfolios, provided that Prudential
reasonably disapproves such changes in accordance with applicable federal
regulations. If Prudential does disregard voting instructions, it will advise
Participants of that action and its reasons for such action in the next annual
or semi-annual report to Participants.

Participants also share with the owners of all Prudential contracts and policies
the right to vote in elections for members of the Board of Directors of
Prudential.

SUBSTITUTION OF FUND SHARES

Although Prudential believes it to be unlikely, it is possible that in the
judgment of its management, one or more of the available portfolios of the Funds
may become unsuitable for investment by Participants. This may occur because of
investment policy changes, tax law changes or considerations, the unavailability
of shares for investment or at the discretion of Prudential. In that event,
Prudential may seek to substitute the shares of another portfolio or of an
entirely different mutual fund. Before this can be done, the approval of the
SEC, and possibly one or more state insurance departments, will be required.
Contractholders and Participants will be notified of such substitution.

ADDITIONAL INSURANCE BENEFITS

Depending on the terms of the Group Contract, one or more of the following
additional insurance benefits may be available to Participants through their
Group Contract. Under some Group Contracts, some or all of these benefits may be
provided to all Participants while under other Group Contracts, individual
Participants may elect whether to receive some or all of these benefits for an
additional charge. The Participant should refer to the Group Contract and
Certificate for further details on additional insurance benefits.

ACCELERATED DEATH BENEFIT. Under some Group Contracts, Participants may be
provided an accelerated death benefit that allows the Participant to elect to
receive an accelerated payment of part of the Certificate's Death Benefit,
adjusted to reflect current value, at a time when certain special needs exist.
The adjusted Death Benefit will always be less than the Death Benefit, but will
generally be greater than the Certificate's Cash Surrender Value. The
accelerated death benefit may be discounted for interest under certain Group
Contracts and where permitted by law. Prudential may charge a fee not to exceed
$350 for payment of an accelerated death benefit.

The following option may be available to the Participant depending on the terms
of the Group Contract.

Terminal Illness Option. This option is available if the Covered Person is
diagnosed as terminally ill with a life expectancy of 12 months or less.
When satisfactory evidence is provided, Prudential will provide to the
Participant an accelerated payment, which may be received in a lump sum, of
the portion of the Death Benefit selected by the Participant as an
accelerated death benefit.

No benefit will be payable if the Participant is required to elect it in order
to meet the claims of creditors or to obtain a government benefit. Prudential
can furnish details about the amount of accelerated death benefit that is
available to an eligible Participant. Unless required by law, a Participant who
has elected to receive an accelerated death benefit can no longer request an
increase in the Face Amount of his or her Certificate, and the amount of future
premium payments he or she can make will be limited.

Adding the accelerated death benefit to the Contract has no adverse
consequences; however, electing to use it could. The recently enacted Health
Insurance Portability and Accountability Act of 1996 excludes from income,
effective January 1, 1997, the accelerated death benefit if the insured is (1)
terminally ill or (2) chronically ill (although the exclusion in the latter case
may be limited). Receipt of an accelerated death benefit payment may also affect
a Participant's eligibility for certain government benefits or entitlements.

ACCIDENTAL DEATH AND DISMEMBERMENT BENEFIT. Under some Group Contracts,
Participants may be provided an accidental death and dismemberment benefit that
provides insurance for accidental loss of life, sight, hand, or foot.

<PAGE>

This benefit will exclude losses due to suicide or attempted suicide, diseases
and infirmities, medical or surgical treatments, and acts of war. It may be
subject to other exclusions from coverage, age limitations, and benefit
limitations set forth in the Group Contract.

EXTENDED DEATH PROTECTION DURING TOTAL DISABILITY. Under some Group Contracts,
Participants will be provided with extended death protection during their total
disability. Under this provision, even if a Participant's insurance (or that of
a spouse) has otherwise ended, insurance equal to the Face Amount of the
Certificate will continue if the Participant became totally disabled prior to
age 60. The extended death protection will continue for successive one-year
periods, generally until age 65, so long as the Participant provides
satisfactory proof of continued total disability.

DEPENDENT LIFE BENEFITS. Under some Group Contracts, Participants may be
provided dependent life benefits, which provide insurance on the life of a
qualified dependent. A qualified dependent may be the Participant's spouse
and/or unmarried child.

SEAT BELT COVERAGE. Under some Group Contracts, Participants may be provided
seat belt coverage, which provides a benefit for the loss of life while driving
or riding in a motor vehicle while wearing a seat belt. "Motor vehicle" means a
private automobile, van, four-wheel drive vehicle, self-propelled motor home and
truck. It does not mean a motor vehicle used for farming, military, business,
racing, or any other type of competitive speed event.
Certain exclusions will apply.

REPORTS

At least once each Certificate Year, Participants will be sent statements that
provide certain information pertinent to their own insurance. These statements
detail values and transactions made and specific insurance data that apply only
to each Participant. On request, a Participant will be sent a current statement
in a form similar to that of the annual statement described above, but
Prudential may limit the number of such requests or impose a reasonable
transaction charge not to exceed $20 for an additional report.

The Contractholder and each Participant will also be sent an annual and
semi-annual report listing the securities held in each available portfolio of
the Funds, as required by the 1940 Act. Records with respect to the Separate
Account are kept in accordance with the 1940 Act.

If a Participant invests in the Series Fund through more than one variable
insurance contract, then the Participant will receive only one copy of each
annual and semi-annual report issued by the Series Fund. However, if such
Participant wishes to receive multiple copies of any such report, a request may
be made by calling the telephone number listed on the cover page of this
prospectus.

SALE OF THE CONTRACT AND SALES COMMISSIONS

Prudential Investment Management Services LLC ("PIMS"), a direct wholly-owned
subsidiary of Prudential, acts as the principal underwriter of the Group
Contracts and Certificates. PIMS, organized in 1996 under Delaware law, is
registered as a broker-dealer under the Securities Exchange Act of 1934 and is a
member of the National Association of Securities Dealers, Inc. PIMS's principal
business address is 751 Broad Street, Newark, New Jersey 07102. PIMS also acts
as principal underwriter with respect to the securities of other Prudential
investment companies. The Group Contracts and Certificates are sold by
registered representatives of PIMS who are also authorized by state insurance
departments to do so. The Group Contracts and Certificates may also be sold
through other broker-dealers authorized by PIMS and applicable law to do so.
Registered representatives of such other broker-dealers may be paid on a
different basis than described below. The maximum commission that will be paid
to the representative upon the purchase of the Contract is 15% of the premium
payment received, and the amount paid to the broker-dealer to cover both the
individual representative's commission and other distribution expenses will not
exceed 15% of the premium payment. The representative may be required to return
all of the first year commission if the Group Contract is not continued through
the first year. Sales representatives who meet certain productivity,
profitability, and persistency standards with regard to the sale of the Group
Contract will be eligible for additional bonus compensation payable by
Prudential. PIMS will generally receive a commission of no more than 15% of the
premium payment. The commission and distribution percentages will depend on
factors such as the size of the group involved and the amount of sales and
administrative effort required in connection with the particular Group Contract
and will not exceed in the aggregate 15% of the premium payment.

The agreement to be entered into between PIMS and Prudential will commence with
the effectiveness of this Registration Statement. This agreement will terminate
automatically upon its assignment within the meaning of

<PAGE>

such term in the 1940 Act. The agreement, however, may be transferred by PIMS
without the prior written consent of Prudential under the circumstances set
forth in Rule 2a-6 under the 1940 Act. The agreement may be terminated at any
time by either party upon 60 days written notice to the other party.

Sales expenses in any year are not equal to the sales charge in that year.
Prudential may not recover its total sales expenses for some or all Group
Contracts over the periods the Certificates for such Group Contracts are in
effect. To the extent that the sales charges are insufficient to cover total
sales expenses, the sales expenses will be recovered from Prudential's surplus,
which may include amounts derived from the mortality and expense risk charge and
the monthly cost of insurance charge. See CHARGES AND EXPENSES, page 28.

RATINGS AND ADVERTISEMENTS

Prudential is rated by independent financial rating services, including Moody's,
Standard & Poors, Duff & Phelps and A.M. Best Company. The purpose of these
ratings is to reflect the financial strength of claims-paying ability of
Prudential. They are not intended to rate the investment experience or financial
strength of the Separate Account. Prudential may advertise these ratings from
time to time. Furthermore, Prudential may include in advertisements comparisons
of currently taxable and tax deferred investment programs, based on selected tax
brackets, or discussions of alternative investment vehicles and general economic
conditions.

PAYMENTS TO THIRD-PARTY ADMINISTRATORS AND ASSOCIATIONS SPONSORING
PARTICIPATION IN THE GROUP CONTRACTS

Prudential may make payments to third party administrators or groups sponsoring
the Group Contracts for their services related to administration and sponsorship
of the Group Contracts.

STATE REGULATION

Prudential is subject to regulation and supervision by the Department of
Insurance of the State of New Jersey, which periodically examines its operations
and financial condition. It is also subject to the insurance laws and
regulations of all jurisdictions in which it is authorized to do business.
Prudential reserves the right to change the Group Contract and Certificate to
comply with applicable state insurance laws and interpretations thereof.

Prudential is required to submit annual statements of its operations, including
financial statements, to the insurance departments of the various jurisdictions
in which it does business to determine solvency and compliance with local
insurance laws and regulations.

In addition to the annual statements referred to above, Prudential is required
to file with New Jersey and other jurisdictions a separate statement with
respect to the operations of all its variable contract accounts, in a form
promulgated by the National Association of Insurance Commissioners.

EXPERTS

The financial statements included in this prospectus for the year ended December
31, 1996 have been audited by Price Waterhouse LLP, independent accountants, as
stated in their reports appearing herein, and are included in reliance upon the
reports of such firm given upon their authority as experts in accounting and
auditing. Price Waterhouse LLP's principal business address is 1177 Avenue of
the Americas, New York, New York 10036.

The financial statements included in this prospectus for years ended December
31, 1995 and December 31, 1994, have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their reports appearing herein, and are
included in reliance upon the reports of such firm given upon their authority as
experts in accounting and auditing. Deloitte & Touche LLP's principal business
address is Two Hilton Court, Parsippany, New Jersey 07054-0319.

On March 12, 1996, Deloitte & Touche LLP was dismissed as the independent
accountants of Prudential. There have been no disagreements with Deloitte &
Touche LLP on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure which, if not resolved to
the satisfaction of the accountant, would have caused them to make reference to
the matter in their reports.

Actuarial matters included in this prospectus have been examined by Stuart L.
Liebeskind, FSA, MAAA, Vice President and Actuary of Prudential whose opinion is
filed as an exhibit to the registration statement.

<PAGE>

LITIGATION

On October 28, 1996, Prudential entered into a Stipulation of Settlement in a
multidistrict proceeding involving allegations of various claims relating to
Prudential's life insurance sales practices. (In re Prudential Insurance Company
of America Sales Practices Litigation, D.N.J., MDL No. 1061, Master Docket No.
95-4704 (AMW)). On March 7, 1997, the United States District Court for the
District of New Jersey approved the Stipulation of Settlement as fair,
reasonable and adequate.

Pursuant to the Settlement, Prudential has agreed to provide an alternative
dispute resolution process for class members who believe they were misled
concerning the sale or performance of their life insurance policies. The
Settlement also provides certain no-fault relief. The ultimate cost of the
Settlement will depend on a variety of factors, including the number of
policyowners who participate in the Settlement, the number of policyowners who
are afforded relief and the remediation option they select. The administrative
costs of implementing the Settlement are also subject to a number of complex
uncertainties. In light of the uncertainties attendant to these and other
factors, it is difficult at this time to estimate the ultimate cost of the
Settlement to Prudential.

In addition, a number of actions have been filed against Prudential by
policyowners who have excluded themselves from the settlement; Prudential
anticipates that additional suits may be filed by other policyowners.

Also, on July 9, 1996, a Multi-State Life Insurance Task Force comprised of
insurance regulators from 29 states and the District of Columbia, released a
report on Prudential's activities. As of February 24, 1997, Prudential had
entered into consent orders or agreements with all 50 states and the District of
Columbia to implement a remediation plan, whose terms closely parallel the
Settlement approved in the MDL proceeding, and agreed to a series of payments
allocated to all 50 states and the District of Columbia amounting to a total of
approximately $65 million.

Litigation is subject to many uncertainties, and given the complexity and scope
of these suits, their outcome cannot be predicted.

Accordingly, management is unable to make a meaningful estimate of the amount or
range of loss that could result from an unfavorable outcome of all pending
litigation. It is possible that the results of operations or the cash flow of
Prudential, in particular quarterly or annual periods could be materially
affected by an ultimate unfavorable outcome of certain pending litigation and
regulatory matters. Management believes, however, that the ultimate outcome of
all pending litigation and regulatory matters referred to above should not have
a material adverse effect on Prudential's financial position.

ADDITIONAL INFORMATION

A registration statement has been filed with the Securities and Exchange
Commission ("SEC") under the Securities Act of 1933, relating to the offering
described in this prospectus. This prospectus does not include all the
information set forth in the registration statement. Certain portions have been
omitted pursuant to the rules and regulations of the SEC. The omitted
information may, however, be obtained from the SEC's principal office in
Washington, D.C., upon payment of a prescribed fee.

Further information may also be obtained from Prudential's office. The address
and telephone number are set forth on the cover of this prospectus.

<PAGE>

DEFINITIONS OF SPECIAL TERMS
USED IN THIS PROSPECTUS

ATTAINED AGE -- A person's age as defined by the Group Contract.

CASH SURRENDER VALUE -- The amount payable to the Participant upon surrender of
the Certificate. The Cash Surrender Value is equal to the Participant's
Certificate Fund on the date of surrender, less any Certificate Debt,
outstanding charges, and any applicable transaction charge.

CERTIFICATE -- A document issued to an Eligible Group Member under a Group
Contract, setting forth or summarizing the Participant's rights and benefits.

CERTIFICATE ANNIVERSARY -- The same date each year as the Certificate Date.

CERTIFICATE DATE -- The effective date of coverage under a Certificate.

CERTIFICATE DEBT -- The principal amount of any outstanding loans to the
Participant under his or her Certificate plus any interest accrued thereon.

CERTIFICATE FUND -- The total amount credited to a Participant under his or her
Certificate. On any date it is equal to the sum of the amounts under that
Certificate allocated to: (1) the Subaccounts, (2) the Fixed Account, and (3)
the Loan Account.

CERTIFICATE YEAR -- The year from the Certificate Date to the first Certificate
Anniversary or from one Certificate Anniversary to the next.

CONTRACT ANNIVERSARY -- The same date each year as specified in the contract.

CONTRACT DATE -- The date as of which the Group Contract is issued.

CONTRACTHOLDER -- The employer, association, sponsoring organization or trust
that is issued a Group Contract. In the case of an employer that joins a
multiple employer trust, the employer exercises the rights accorded to a
Contractholder as described throughout this prospectus.

COVERED PERSON -- The person whose life is insured under the Group Contract. The
Covered Person is generally the Participant. Some Group Contracts may permit a
Participant to apply for insurance under a second Certificate naming the
Participant's spouse as
the Covered Person.

DEATH BENEFIT -- The amount payable upon the death of the Covered Person (before
the deduction of any Certificate Debt or any outstanding charges).

DIVIDEND -- A portion of Prudential's divisible surplus attributable to the
Group Contract that may be credited to the Group Contract as determined annually
by Prudential's Board of Directors.

ELIGIBLE GROUP MEMBERS -- The persons specified in the Group Contract as
eligible to apply for insurance protection under the Group Contract.

EXPERIENCE CREDIT -- A refund that may be given under certain Group Contracts
based on favorable mortality experience.

FACE AMOUNT -- The amount of life insurance in a Participant's Certificate. The
Face Amount will be the minimum Death Benefit as long as the Participant's
Certificate remains in force.

FIXED ACCOUNT -- An investment option under which Prudential guarantees that
interest will be added to the amount deposited at a rate declared periodically
in advance.

FUNDS -- The Series Fund portfolios and other mutual fund portfolios in which
the Separate Account invests.

GROUP CONTRACT -- A Group Variable Universal Life insurance contract issued to
the Contractholder by Prudential.

GUIDELINE ANNUAL PREMIUM -- A level annual premium that would be payable
throughout the duration of a Certificate to fund the future benefits if the
certificate were a fixed premium contract, based on certain assumptions set
forth in a rule of the SEC. Upon request, Prudential will advise a Participant
of the guideline annual premium under your Certificate.

ISSUE AGE -- The Covered Person's Attained Age on the date that the insurance on
that Covered Person goes into effect as defined by the Group Contract.

LOAN ACCOUNT -- An account within Prudential's general account to which is
transferred from the Separate Account and/or the Fixed Account an amount equal
to the amount of any loan.

LOAN VALUE -- The amount (before any applicable transaction charge) that a
Participant may borrow at any given time under his or her Certificate. The Loan
Value at any time is determined by multiplying the Certificate Fund by 90% (or
higher where required by state law) and then subtracting any existing loan with
accrued interest, outstanding charges, and the amount of the next month's
charges.

<PAGE>

MONTHIVERSARY -- The Contract Date and the first day of each succeeding month,
except that whenever the contract Monthiversary falls on a date other than a
Valuation Date the Monthiversary will be the next Valuation Date.

NET PREMIUM -- A Participant's premium payment minus any charges for taxes
attributable to premiums, any processing fee, and any sales charge. Net Premiums
are the amounts available for allocation to the Separate Account and/or the
Fixed Account.

PARTICIPANT -- An Eligible Group Member or "eligible applicant owner" under a
Group Contract who obtains insurance under the Group Contract and is eligible to
exercise the rights described in the Certificate. The Participant will be the
person entitled to exercise all rights under a Certificate, regardless of
whether the Covered Person under the Certificate is the Participant or his or
her spouse. References to rights that a Participant may exercise under a
Certificate shall include exercise of such rights by any person to whom the
Participant has validly assigned such rights.

PORTABLE -- A status that may occur when a Participant is no longer an Eligible
Group Member under the Group Contract because of the occurrence of an event
specified in the Group Contract or the Certificate. Such events may include
termination of the Participant's employment or other relationship with the
Contractholder or retirement of the Participant. Cost of insurance rates and
charges may increase under a Portable Certificate since the Covered Person under
a Portable Certificate may no longer be considered to be a member of the
Contractholder's group for purposes of determining those rates and charges.

SEPARATE ACCOUNT -- Prudential Variable Contract Account GI--2, a separate
investment account registered as a unit investment trust under the Investment
Company Act of 1940 and established by Prudential to receive and invest the Net
Premiums paid under the Certificates.

SERIES FUND -- The Prudential Series Fund, Inc., a mutual fund with separate
portfolios, one or more of which may be used as an underlying investment for the
Group Contracts.

SUBACCOUNT -- A division of the Separate Account, the assets of which are
invested in the shares of the corresponding Fund.

VALUATION DATE -- Each day on which the value of the amount invested in a
Subaccount is determined, which is generally each day that the New York Stock
Exchange is open for trading.

VALUATION PERIOD -- The period of time from one determination of the value of
the amount invested in a Subaccount to the next. Such determinations are made
when the net asset values of the portfolios of the Funds are calculated.

<PAGE>

DIRECTORS AND OFFICERS OF PRUDENTIAL

The directors and certain officers of Prudential, listed with their principal
occupations during the past 5 years, are shown below.

DIRECTORS OF PRUDENTIAL

FRANKLIN E. AGNEW. Director.--Business Consultant. Address: USX Tower, Suite
660, 600 Grant Street, Pittsburgh, PA 15219.

FREDERIC K. BECKER, Director.--President, Wilentz, Goldman, and Spitzer (law
firm). Address: 90 Woodbridge Center Drive, Woodbridge, NJ 07095.

JAMES G. CULLEN, Director.--Vice Chairman, Bell Atlantic Corporation since 1995;
1993 to 1995: President, Bell Atlantic Corporation; Prior to 1993: President,
New Jersey Bell. Address: 1310 North Court House Road, 11th
floor, Alexandria, VA 22201.

CAROLYNE K. DAVIS, Director.--National and International Health Care Advisor,
Ernst & Young LLP. Address: 1225 Connecticut Avenue, NW, Washington, DC 20036.

ROGER A. ENRICO, Director.--Chairman and Chief Executive Officer, Pepsico Inc.
since 1996; Vice Chairman, Pepsico, Inc., from 1993 to 1996; Chairman and Chief
Executive Officer, Pepsi Co. Worldwide Food, from 1991 to 1993. Address: 14841
North Dallas Parkway, Dallas, TX 75240.

ALLAN D. GILMOUR, Director.--Former Vice Chairman, Ford Motor Company. Address:
Prudential Plaza, Newark, NJ 07102-3777.

WILLIAM H. GRAY, III, Director.--President and Chief Executive Officer, The
College Fund/UNCF. Address: 8260 Willow Oaks Corporate Drive, Fairfax, VA 22031.

JON F. HANSON, Director.--Chairman, Hampshire Management Company. Address: 235
Moore Street, Suite 200, Hackensack, NJ 07601.

GLEN H. HINER, JR., Director.--Chairman and Chief Executive Officer, Owens
Corning. Address: One Owens Corning Parkway, Toledo, OH 43659.

CONSTANCE J. HORNER, Director.--Guest Scholar, The Brookings Institution since
1993; 1991 to 1992: Assistant to the President and Director of Presidential
Personnel, U.S. Government. Address: 1775 Massachusetts Avenue, N.W.,
Washington, DC 20036-2188.

GAYNOR N. KELLEY, Director.--Retired Chairman and Chief Executive Officer, The
Perkin Elmer Corporation. Address: 751 Broad Street, Newark, NJ 07102-3777.

BURTON G. MALKIEL, Director.--Professor, Princeton University. Address:
Princeton University, 110 Fisher Hall, Prospect Avenue, Princeton, NJ
08544-1021.

ARTHUR F. RYAN, Chairman of the Board, President, and Chief Executive Officer.
- -- Chairman, President, and Chief Executive Officer, Prudential since 1994;
Prior to 1994, President and Chief Operating Officer, Chase Manhattan
Corporation. Address: 751 Broad Street, Newark, NJ 07102-3777.

IDA F. S. SCHMERTZ, Director.--Principal, Investment Strategies International
since 1994; Prior to 1994: Senior Vice President of Corporate Affairs, American
Express Company. Address: 90 Riverside Dr., New York, NY 10024.

CHARLES R. SITTER, Director.--Former President, Exxon Corporation. Address: 5959
Las Colinas Boulevard, Irving, TX 75039-2298.

DONALD L. STAHELI, Director.--Chairman and Chief Executive Officer, Continental
Grain Company since 1995; Prior to 1995: President and Chief Executive Officer,
Continental Grain Company. Address: 277 Park Avenue, New York, NY 10172.

RICHARD M. THOMSON, Director.--Chairman and Chief Executive Officer, The
Toronto-Dominion Bank. Address: P.O. Box 1, Toronto-Dominion Centre, Toronto,
Ontario, M5K 1A2, Canada.

<PAGE>

JAMES A. UNRUH, Director.--Chairman and Chief Executive Officer, Unisys
Corporation. Address: P.O. Box 500, Blue Bell, PA 19424-0001.

P. ROY VAGELOS, M.D., Director.--Former Chairman and Chief Executive Officer,
Merck & Co., Inc. Address: One Crossroads Drive, Bedminster, NJ 07921.

STANLEY C. VAN NESS, Director.--Attorney, Picco Herbert Kennedy (law firm).
Address: One State Street Square, Suite 1000, Trenton, NJ 08607-1388.

PAUL A. VOLCKER, Director.--Business Consultant since 1996; Prior to 1996:
Chairman, Wolfensohn & Co., Inc. Address: 599 Lexington Avenue, New York, NY
10022.

JOSEPH H. WILLIAMS, Director.--Director, The Williams Companies since 1994;
Prior to 1994: Chairman and Chief Executive Officer, The Williams Companies.
Address: One Williams Center, Tulsa, OK 74172.

OTHER EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS

MARTIN A. BERKOWITZ, Senior Vice President and Comptroller.--Senior Vice
President and Chief Financial Officer of Prudential Investment Company.

SUSAN L. BLOUNT, Vice President and Secretary.--Vice President and Secretary of
Prudential since 1995; Prior to 1995: Assistant General Counsel for Prudential
Residential Services Company.

C. EDWARD CHAPLIN, Vice President and Treasurer.--Vice President and Treasurer
of Prudential since 1995; 1993 to 1995: Managing Director and Assistant
Treasurer of Prudential; 1992 to 1993: Vice President and Assistant Treasurer,
Banking and Cash Management for Prudential.

MARK B. GRIER, Chief Financial Officer.--Chief Financial Officer of Prudential
since 1995; Prior to 1995: Executive Vice President and Head of Global Markets,
Chase Manhattan Corporation.

<PAGE>

FINANCIAL STATEMENTS

The statutory financial statements of Prudential included herein should be
distinguished from the financial statements of the Separate Account, and should
be considered only as bearing upon the ability of Prudential to meet its
obligations under the Certificates.

Financial statements of the Separate Account are not included in this Prospectus
because the Separate Account had not yet commenced operations as of the date of
this Prospectus.

<TABLE>
<CAPTION>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

STATEMENTS OF ADMITTED ASSETS, LIABILITIES AND SURPLUS (STATUTORY BASIS)
- ------------------------------------------------------------------------------------------------------------------------------------

DECEMBER 31,
1996 1995
-------- --------
(In Millions)
<S> <C> <C>
ASSETS
Bonds ............................................................................ $ 75,006 $ 77,494
Preferred stock .................................................................. 239 396
Common stock ..................................................................... 7,076 6,133
Mortgage loans on real estate .................................................... 17,039 20,280
Real estate ...................................................................... 2,094 2,488
Policy loans and premium notes ................................................... 6,023 6,208
Cash and short-term investments .................................................. 5,982 4,803
Other invested assets ............................................................ 2,591 3,304
-------- --------

TOTAL CASH AND INVESTED ASSETS ................................................... 116,050 121,106

Premiums due and deferred ........................................................ 1,925 1,917
Accrued investment income ........................................................ 1,640 1,688
Other assets ..................................................................... 1,208 1,120
Assets held in separate accounts ................................................. 57,797 53,903
-------- --------

TOTAL ASSETS ..................................................................... $178,620 $179,734
======== ========

LIABILITIES AND SURPLUS

LIABILITIES

Policy liabilities and insurance reserves:
Future policy benefits and claims ............................................ $ 87,582 $ 93,346
Unearned premiums ............................................................ 619 624
Policy dividends ............................................................. 1,878 1,893
Policyholder account balances ................................................ 7,968 7,966
Notes payable and other borrowings ............................................... 763 807
Asset valuation reserve .......................................................... 2,682 2,705
Federal income tax payable ....................................................... 729 1,278
Other liabilities ................................................................ 9,588 9,191
Liabilities related to separate accounts ......................................... 57,436 53,256
-------- --------

TOTAL LIABILITIES ................................................................ 169,245 171,066
-------- --------

CONTINGENCIES (NOTE 11)

SURPLUS

Capital notes .................................................................... 985 984
Special surplus fund ............................................................. 1,268 1,274
Unassigned surplus ............................................................... 7,122 6,410
-------- --------

TOTAL SURPLUS .................................................................... 9,375 8,668
-------- --------

TOTAL LIABILITIES AND SURPLUS .................................................... $178,620 $179,734
======== ========
</TABLE>

SEE NOTES TO STATUTORY FINANCIAL STATEMENTS
<PAGE>

<TABLE>
<CAPTION>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

STATEMENTS OF OPERATIONS AND CHANGES IN SURPLUS (STATUTORY BASIS)
- ------------------------------------------------------------------------------------------------------------------------------------

YEARS ENDED DECEMBER 31,
1996 1995 1994
(In Millions)

<S> <C> <C> <C>
REVENUE

Premiums and annuity considerations .................................... $ 20,674 $ 21,088 $ 23,612
Net investment income .................................................. 8,677 8,637 7,387
Other income ........................................................... 571 363 367
-------- -------- --------

TOTAL REVENUE .......................................................... 29,922 30,088 31,366
-------- -------- --------

BENEFITS AND EXPENSES

Death benefits ......................................................... 2,943 2,858 2,798
Annuity benefits ....................................................... 3,582 3,495 3,354
Disability benefits .................................................... 5,630 5,765 5,201
Other benefits ......................................................... 806 853 845
Surrender benefits and fund withdrawals ................................ 11,844 12,538 11,714
Net (decrease) increase in reserves .................................... (1,572) (2,178) 1,251
Commissions ............................................................ 477 535 610
Other expenses ......................................................... 2,690 2,650 3,727
-------- -------- --------

TOTAL BENEFITS AND EXPENSES ............................................ 26,400 26,516 29,500
-------- -------- --------

Operating income before dividends and income taxes ..................... 3,522 3,572 1,866
Dividends to policyholders ............................................. 2,526 2,464 2,290
-------- -------- --------

Operating income (loss) before income taxes ............................ 996 1,108 (424)
Income tax provision ................................................... 51 590 453
-------- -------- --------

INCOME (LOSS) FROM OPERATIONS .......................................... 945 518 (877)

NET REALIZED CAPITAL GAINS (LOSSES) .................................... 457 (183) (24)
-------- -------- --------

NET INCOME (LOSS) ..................................................... $ 1,402 $ 335 $ (901)
======== ======== ========

SURPLUS

SURPLUS, BEGINNING OF YEAR ............................................. 8,668 7,449 8,004

Net income (loss) ...................................................... 1,402 335 (901)
Change in net unrealized capital gains (losses) ........................ 191 661 (51)
Change in non-admitted assets .......................................... (206) 717 82
Change in asset valuation reserve ...................................... 11 (694) 653
Other changes, net ..................................................... (691) 200 (338)
-------- -------- --------

SURPLUS, END OF YEAR ................................................... $ 9,375 $ 8,668 $ 7,449
======== ======== ========
</TABLE>

SEE NOTES TO STATUTORY FINANCIAL STATEMENTS

- 1 -
<PAGE>

<TABLE>
<CAPTION>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

STATEMENTS OF CASH FLOWS (STATUTORY BASIS)
- ------------------------------------------------------------------------------------------------------------------------------------

YEARS ENDED DECEMBER 31,
1996 1995 1994
--------- --------- ---------
(In Millions)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Premiums and annuity considerations ...................................... $ 20,669 $ 21,030 $ 23,635
Net investment income .................................................... 8,629 8,511 7,261
Other income received .................................................... 599 479 502
Separate account transfers ............................................... 1,183 1,002 (494)
Benefits and claims paid ................................................. (24,952) (25,524) (24,403)
Policyholders' dividends paid ............................................ (2,453) (2,393) (2,594)
Federal income taxes (paid) received ..................................... (230) (847) 179
Other operating expenses ................................................. (4,224) (3,738) (3,636)
--------- --------- ---------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES ...................... (779) (1,480) 450
--------- --------- ---------

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from investments sold, matured, or repaid
Bonds ............................................................... 119,195 93,178 80,668
Stocks .............................................................. 4,328 2,985 4,263
Mortgage loans on real estate ....................................... 3,140 4,997 4,205
Real estate ......................................................... 537 573 935
Net gains (losses) on cash and short-term investments ............... 13 (9) (5)
Miscellaneous proceeds .............................................. 2,128 3,707 2,671
Payments for investments acquired
Bonds ............................................................... (118,009) (101,018) (81,677)
Stocks .............................................................. (6,029) (2,199) (2,312)
Mortgage loans on real estate ....................................... (1,841) (2,810) (3,282)
Real estate ......................................................... (120) (425) (194)
Miscellaneous applications .......................................... (718) (1,213) (1,275)
Net (tax) benefit on capital gains and losses ............................ (622) 107 (275)
--------- --------- ---------

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES ...................... 2,002 (2,127) 3,722
--------- --------- ---------

CASH FLOWS FROM FINANCING ACTIVITIES

Net (repayments of) proceeds from borrowed money ......................... (44) 123 1
Net proceeds from the issuance of capital notes .......................... 0 686 0
--------- --------- ---------

NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES ..................... (44) 809 1
--------- --------- ---------

NET INCREASE (DECREASE) IN CASH AND SHORT-TERM INVESTMENTS ............... 1,179 (2,798) 4,173
Cash and short-term investments, beginning of year ....................... 4,803 7,601 3,428
--------- --------- ---------

CASH AND SHORT-TERM INVESTMENTS, END OF YEAR ............................. $ 5,982 $ 4,803 $ 7,601
========= ========= =========
</TABLE>

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Interest payments of $253 million, $144 million and $85 million were made during
1996, 1995 and 1994, respectively.

SEE NOTES TO STATUTORY FINANCIAL STATEMENTS

- 2 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

1. ACCOUNTING POLICIES AND PRINCIPLES

A. Business and basis of presentation - The statutory financial
statements include the accounts of The Prudential Insurance Company of
America ("the Company"), a mutual life insurance company. The
activities of the Company include a broad range of financial services,
including life and health insurance, asset management, and investment
advisory services.

These financial statements were prepared on an unconsolidated
statutory basis of accounting, which differs from the 1995 and 1994
financial statements prepared for general distribution on a
consolidated statutory basis of accounting, both of which differ from
generally accepted accounting principles ("GAAP"). The financial
statements for 1995 and 1994 have been restated on an unconsolidated
statutory basis of accounting adopted in 1996 for purposes of general
distribution. Certain reclassifications have been made to the 1995 and
1994 financial statement amounts to conform to the 1996 presentation.

The Company, domiciled in the State of New Jersey, prepares its
statutory financial statements in accordance with accounting practices
prescribed or permitted by the New Jersey Department of Banking and
Insurance ("the Department"). Prescribed statutory accounting
practices include publications of the National Association of
Insurance Commissioners ("NAIC"), state laws, regulations, and general
administrative rules. Permitted statutory accounting practices
encompass all accounting practices not so prescribed. The financial
statements are substantially the same as those included in the
Statutory Annual Statement except for certain reclassifications and
adjustments. These financial statements differ from those filed with
the Department in that changes to estimated income and premium taxes
applicable to prior periods, which are recorded as direct charges or
credits to surplus in the Annual Statement, have been included in the
"Income tax provision" and "Other expenses" in the Statements of
Operations and Changes in Surplus. This item has the net effect of
increasing (decreasing) net income by $396 million, ($143) million and
$6 million in 1996, 1995 and 1994, respectively.

Pursuant to the Financial Accounting Standards Board Interpretation
No. 40 "Applicability of Generally Accepted Accounting Principles to
Mutual Life Insurance and Other Enterprises," as amended, which is
effective for 1996 financial statements, statutory accounting
practices ("SAP") are no longer considered GAAP for mutual life
insurance companies. SAP differs from GAAP primarily as follows:

(a) the Commissioner's Reserve Valuation Method ("CRVM") is used for the
majority of individual insurance reserves under SAP, whereas for
individual insurance, policyholder liabilities are generally
established using the net level premium method under GAAP. Policy
assumptions used in the estimation of policyholder liabilities are
generally prescribed under SAP, but are based upon actual company
experience under GAAP;

(b) for investment-type contracts that do not contain mortality or
morbidity risk and universal life-type contracts, cash receipts are
recorded as premiums and reserves are established using prescribed
reserving methods under SAP. Under GAAP, premium from investment-type
and universal life-type contracts are generally recognized as
deposits. Revenues from these contracts represent amounts assessed
against policyholders and are reported in the period of assessment;

(c) policy acquisition costs are expensed when incurred under SAP rather
than being deferred and charged against earnings over the periods
covered by the related policies;

(d) deferred income taxes are not recorded for the tax effect of temporary
differences between book and tax basis of assets and liabilities under
SAP;

(e) certain "non-admitted assets" must be excluded under SAP through a
charge against surplus, e.g. fixed assets, prepaid pensions and
impaired investments;

(f) investments in the common stock of the Company's wholly-owned
subsidiaries are accounted for using the equity method under SAP
rather than consolidated;

(g) bonds are carried at amortized cost under SAP rather than categorized
as "held to maturity", "available for sale", or "trading". Under GAAP,
bonds classified as "available for sale" and "trading" are carried at
market value;

(h) certain reclassifications would be required with respect to the
balance sheet and statement of cash flows under SAP;

(i) the Asset Valuation Reserve ("AVR") and Interest Maintenance Reserve
("IMR") are required for life insurance companies under SAP.

The following is a summary of accounting practices permitted by the
state of New Jersey and reflected in these financial statements:

o Prescribed statutory accounting practices require Department
approval of each and every interest payment at the time of
payment in order to classify the Company's Capital Notes as a
component of surplus. Otherwise, such notes are required to be
classified as a liability. Interest payments on $300 million in
Capital Notes issued in 1993 are pre-approved by the Department,
and permitted to be classified in surplus.

o The Company sells synthetic guaranteed interest contracts
("GICs") containing minimum investment related guarantees on
qualified pension plan assets. The assets are owned by the
trustees of such plans, who invest the assets

- 3 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

under the terms of investment guidelines agreed to with the
Company. The investment related guarantees may include a minimum
rate of return on the underlying assets and/or a guarantee of
liquidity to meet plan cash flow requirements. The Company, with
the approval of the Department, reports both the plan liabilities
associated with the synthetic GICs and the trust assets
supporting this potential liability. In addition, the Company
files detailed schedules of trust assets and related statements
with the Department. Currently, prescribed statutory accounting
practices do not address accounting for synthetic GICs.

o The Company establishes guaranty fund liabilities for the
insolvencies of certain life insurance companies. The liabilities
are established net of estimated premium tax credits and federal
income tax. Prescribed statutory accounting practices do not
address the establishment of liabilities for guaranty fund
assessments.

B. Divestiture - On July 31, 1996, Prudential sold a substantial portion
of its Canadian Branch business to the London Life Insurance Company
("London Life"). The transaction was structured as an assumption
reinsurance transaction, whereby London Life assumed total liabilities
of the Canadian Branch equal to $3,146 million as well as a related
amount of total assets equal to $3,040 million. A net gain of $138
million was recorded for this transaction.

C. Use of estimates - The preparation of financial statements in
conformity with SAP 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 revenue and expenses
during the reported period. Actual results could differ from those
estimates.

D. Investments - Bonds, which consist of long-term bonds, are stated
primarily at amortized cost.

Preferred stock is generally valued at amortized cost.

Common Stock is carried at fair value. Investments in subsidiaries,
which are included in "Common stock", are accounted for using the
equity method. The subsidiaries' change in net assets, excluding
capital contributions and distributions, is included in "Net
investment income." The subsidiaries are engaged principally in the
businesses of life and health insurance, property and casualty
insurance, group health care, securities brokerage, asset management,
investment advisory services, retail banking and real estate and
brokerage.

Mortgage loans on real estate are stated primarily at unpaid principal
balances.

Real estate, except for real estate acquired in satisfaction of debt,
is carried at cost less accumulated straight-line depreciation,
encumbrances and permanent impairments in value. Properties acquired
in satisfaction of debt are valued at lower of depreciated cost or
fair value less disposition costs.

Policy loans and premium notes are stated at unpaid principal
balances.

Cash includes cash on hand, amounts due from banks and money market
instruments. Short term investments, including highly liquid debt
instruments purchased with an original maturity of twelve months or
less, are stated at amortized cost, which approximates fair value.

Other invested assets primarily include the Company's investment in
joint ventures and other forms of partnerships. These investments are
accounted for using the equity method where the Company has the
ability to exercise significant influence over the operating and
financial policies of the entity. The cost method is used for all
other assets.

Derivatives used in asset/liability risk management activities, which
support life and health insurance and annuity contracts, are recorded
at either fair value or statement value, depending upon the underlying
instrument, with unrealized gains and losses recorded in "Change in
net unrealized capital gains (losses)." Upon termination of
derivatives, the interest-related gains and losses are amortized
through the IMR.

E. Separate accounts - These assets and liabilities, reported at
estimated fair value, represent segregated funds invested for pension
and other clients. Investment risks associated with fair value changes
are generally borne by the clients, except to the extent of minimum
guarantees made by the Company with respect to certain accounts.

F. Revenue recognition of insurance income and related expenses - Life
premiums are recognized as income over the premium paying period of
the related policies. Annuity considerations are recognized as revenue
when received. Health premiums are earned ratably over the terms of
the related insurance and reinsurance contracts or policies. Expenses
incurred in connection with acquiring new insurance business,
including such acquisition costs as sales commissions, are charged to
operations as incurred.

- 4 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

G. Policyholder dividends - Substantially all of the policies issued by
the Company are participating. The amount of dividends to be paid to
policyholders is determined annually by the Company's Board of
Directors. The aggregate amount of policyholders' dividends is related
to actual interest, mortality, morbidity, and expense experience for
the year and judgment as to the appropriate level of statutory surplus
to be retained by the Company. Dividends declared by the Board of
Directors which have not been paid are included in "Policy dividends".

2. POLICY LIABILITIES AND INSURANCE RESERVES

A. For life insurance and annuities, future policy benefits and claims
include estimates of benefits and associated settlement expenses on
reported claims and those which are incurred but not reported.

Activity in the liability for unpaid claims and claim adjustment
expenses for accident and health business, which is included in
"Future policy benefits and claims", is as follows:

1996 1995 1994
------- ------- -------
(In Millions)

Balance at January 1 $ 2,636 $ 2,440 $ 2,416
Less reinsurance recoverables 15 23 15
------- ------- -------

Net balance at January 1 2,621 2,417 2,401
------- ------- -------

Incurred related to:
Current year 5,734 5,759 5,398
Prior years (87) 42 (87)
------- ------- -------

Total incurred 5,647 5,801 5,311
------- ------- -------

Paid related to:
Current year 4,135 4,028 3,856
Prior years 1,467 1,569 1,439
------- ------- -------

Total paid 5,602 5,597 5,295
------- ------- -------

Net balance at December 31 2,666 2,621 2,417
Plus reinsurance recoverables 10 15 23
------- ------- -------

Balance at December 31 $ 2,676 $ 2,636 $ 2,440
======= ======= =======

As a result of changes in reserve estimates for insured events of
prior years, the provision for claims and claim adjustment expenses
changed by ($87) million and $42 million in 1996 and 1995,
respectively, due to changes in claim cost trends and changed by ($87)
million in 1994 because of faster-than-expected shrinkage in the
indemnity health business.

B. Reserves for individual life insurance are calculated using various
methods, interest rates and mortality tables, which produce reserves
that meet the aggregate requirements of state laws and regulations.
Approximately 39% of individual life insurance reserves are determined
using the net level premium method, or by using the greater of the net
level premium reserve or the policy cash value. About 52% of
individual life insurance reserves are calculated according to CRVM
or methods which compare CRVM to policy cash values. The remaining
reserves include universal life reserves which are equal to the
greater of the policyholder account value less the unamortized expense
allowance and the policy cash value, or are for supplementary benefits
whose reserves are calculated using methods, interest rates and tables
appropriate for the benefit provided.

For group life insurance, about 56% of the reserves are associated
with extended death benefits. These reserves are primarily calculated
using modified group tables at various interest rates. The remainder
are unearned premium reserves (calculated using the 1960
Commissioner's Standard Group Table), reserves for group life fund
accumulations and other miscellaneous reserves.

Reserves for deferred individual annuity contracts are determined
using the Commissioner's Annuity Reserve Valuation Method. These
account for 72% of the individual annuity reserves. The remaining
reserves are equal to the present value of future payments with the
annuity mortality table and interest rates based on the date of issue
or maturity as appropriate.

Reserves for other deposit funds or other liabilities with life
contingencies reflect the contract deposit account or experience
accumulation for the contract and any purchased annuity reserves.

Accident and health reserves represent the present value of the future
potential payments, adjusted for contingencies and interest. The
remaining material reserves for active life reserves and unearned
premiums are valued using the preliminary term method, gross premium
valuation method, or a pro rata portion of gross premiums. Reserves
are also held for amounts not yet due on hospital benefits and other
coverages.

- 5 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

The reserve for guaranteed interest contracts, deposit funds and other
liabilities without life contingencies equal either the present value
of future payments discounted at the guaranteed rate or the fund
value.

Policyholders, at their discretion, may withdraw funds from their
annuity policies. At December 31, 1996 and 1995, approximately 55% of
total annuity actuarial reserves and deposit liabilities of $92,536
million and $95,092 million, respectively, were not subject to
discretionary withdrawal.

3. INCOME TAXES

The Company and its domestic subsidiaries file a consolidated federal income
tax return. The Internal Revenue Code (the "Code") taxes the Company on its
operating income after dividends to policyholders. In calculating this tax,
the Code requires the capitalization and amortization of policy acquisition
expenses.

The Code also imposes an "equity tax" on mutual life insurance companies
which, in effect, imposes an additional amount of taxable income to the
Company. "Income tax provision" includes an estimate for the total equity tax
to be paid with respect to the year. Income from sources outside the United
States is taxed under applicable foreign statutes.

The Internal Revenue Service (the "Service") has completed an examination of
the consolidated federal income tax return through 1989. The Service is
examining the years 1990 through 1992. Discussions are being held with the
Service with respect to proposed adjustments. However, management believes
there are adequate defenses against, or sufficient reserves to provide for,
such adjustments.

4. INVESTED ASSETS

A. Bonds and stocks - The Company invests in both investment grade and
non-investment grade public and private bonds. The Securities
Valuation Office of the NAIC rates the bonds held by insurers for
regulatory purposes and classifies investments into six categories
ranging from highest quality bonds to those in or near default. The
lowest three NAIC categories represent primarily high-yield securities
and are defined by the NAIC as including any security with a public
agency rating equivalent to B+ or B1 or less. Securities in these
lowest three categories approximated 2.8% and 1.0%, of the Company's
bonds at December 31, 1996, 1995, respectively.

The following tables provide additional information relating to bonds
and preferred stock as of December 31:

<TABLE>
<CAPTION>
1996
-------------------------------------------------------
GROSS GROSS ESTIMATED
CARRYING UNREALIZED UNREALIZED FAIR
AMOUNT GAINS LOSSES VALUE
------- ------- ------ -------
Bonds (In Millions)
<S> <C> <C> <C> <C>
U.S. Treasury securities and obligations of
U.S. government corporations and agencies $ 9,504 $ 353 $ 74 $ 9,783

Obligations of U.S. states and their
political subdivisions 206 7 6 207

Foreign government bonds 2,420 133 11 2,542

Corporate securities 57,282 2,625 323 59,584

Mortgage-backed securities 5,594 131 15 5,710
------- ------- ------- -------

Total $75,006 $ 3,249 $ 429 $77,826
======= ======= ======= =======

Preferred Stock
Redeemable $ 142 $ 3 $ 6 $ 139

Non-redeemable 97 23 0 120
------- ------- ------- -------

Total $ 239 $ 26 $ 6 $ 259
======= ======= ======= =======

</TABLE>

- 6 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

<TABLE>
<CAPTION>
1995
--------------------------------------------------
GROSS GROSS
CARRYING UNREALIZED UNREALIZED FAIR
AMOUNT GAINS LOSSES VALUE
------- ------- ------- -------
Bonds (In Millions)
<S> <C> <C> <C> <C>
U.S. Treasury securities and obligations of
U.S. government corporations and agencies $15,715 $ 1,392 $ 1 $17,106

Obligations of U.S. states and their
political subdivisions 214 22 1 235

Foreign government bonds 3,196 260 1 3,455

Corporate securities 54,411 4,609 97 58,923

Mortgage-backed securities 3,958 241 8 4,191
------- ------- ------- -------

Total $77,494 $ 6,524 $ 108 $83,910
======= ======= ======= =======

Preferred Stock
Redeemable $ 304 $ 16 $ 4 $ 316

Non-redeemable 92 2 0 94
------- ------- ------- -------

Total $ 396 $ 18 $ 4 $ 410
======= ======= ======= =======

</TABLE>

The carrying amount and estimated fair value of bonds at December 31,
1996, categorized by contractual maturity, are shown below. Actual
maturities may differ from contractual maturities because borrowers
may prepay obligations with or without call or prepayment penalties.

CARRYING ESTIMATED
AMOUNT FAIR VALUE
-------- ----------
(In Millions)

Due in one year or less $ 1,999 $ 2,012
Due after one year through five years 19,125 19,445
Due after five years through ten years 19,406 20,081
Due after ten years 28,882 30,578
------- -------
69,412 72,116
------- -------

Mortgage-backed securities 5,594 5,710
------- -------

Total $75,006 $77,826
======= =======

Proceeds from the sale and maturity of bonds during 1996, 1995 and
1994 were $119,195 million, $93,178 million and $80,668 million,
respectively. Gross gains of $1,516 million, $1,913 million and $618
million and gross losses of $988 million, $782 million and $1,841
million were realized on such sales during 1996, 1995 and 1994,
respectively. Realized gains and losses are determined using the
specific identification method.

B. Mortgage loans on real estate - Mortgage loans on real estate at
December 31 are as follows:

1996 1995
------------------ ------------------
CARRYING PERCENT CARRYING PERCENT
AMOUNT OF TOTAL AMOUNT OF TOTAL
------ -------- ------ --------
(In Millions)
Commercial and agricultural loans:
In good standing $15,546 91.3% $17,649 87.0%
In good standing
with structured terms 809 4.7% 966 4.8%
Past due 90 days or more 229 1.3% 144 0.7%
In process of foreclosure 68 0.4% 157 0.8%

Residential loans 387 2.3% 1,364 6.7%
------- ----- ------- -----

Total $17,039 100.0% $20,280 100.0%
======= ===== ======= =====

At December 31, 1996, the Company's mortgage loans on real estate were
collateralized by the following property types: office buildings
(34%), retail stores (22%), residential properties (2%), apartment
complexes (18%), industrial buildings (11%), agricultural properties
(9%) and other commercial properties (4%). The maximum percentage of
any one loan to the value of collateral at the time of the loan,
exclusive of insured, guaranteed, purchase money mortgages or
mortgages supported by high credit leases is 80%. The mortgage loans
are geographically dispersed throughout the United States and

- 7 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

Canada with the largest concentrations in California (26%) and New
York (8%). Included in these balances are mortgage loans with
affiliated joint ventures of $560 million and $653 million at December
31, 1996 and 1995, respectively.

C. Real estate - Real estate at December 31 was as follows:

1996 1995
------ ------
(In Millions)

Investment real estate $1,201 $1,484
Properties occupied by the Company 525 533
Properties acquired in
satisfaction of debt 368 471
------ ------

Total $2,094 $2,488
====== ======

Accumulated depreciation on real estate was $808 million and $853
million at December 31, 1996 and 1995, respectively.

D. Other invested assets - Other invested assets of $2,591 million and
and $3,304 million as of December 31, 1996 and 1995, respectively,
principally include the Company's net equity in joint ventures and
other forms of partnerships. The Company's share of net income from
other invested assets was $283 million, $240 million and $348 million
for 1996, 1995 and 1994, respectively.

E. Investment in subsidiaries - Included in "Common stock" is the
Company's investment in subsidiaries of $4,610 million and $4,328
million at December 31, 1996 and 1995, respectively. Included in "Net
investment income" for 1996, 1995 and 1994 is $370 million, $143
million and $(936) million, respectively, attributable to
undistributed income (loss) of subsidiaries.

In October 1995, the Company completed the sale of Prudential
Reinsurance Holdings, Inc., through an initial public offering of
common stock. As a result of the sale, an after-tax gain of $72
million was recorded in 1995.

In March 1995, the Company announced its intention to sell its
mortgage banking unit. On January 26, 1996, the Company entered into a
definitive agreement to sell substantially all the assets of
Prudential Home Mortgage Company, Inc. ("PHMC") and it also
liquidated certain mortgage-backed securities and extended warehouse
loans. In 1995, PHMC recorded an after-tax loss of $98 million which
includes operating gains and losses, asset write downs, and other
costs directly related to the sale. The Company continues to have
discussions with prospective buyers for the sale of the remaining
assets.

F. Net unrealized capital gains (losses) - Changes in net unrealized
capital gains (losses), which result principally from changes in the
differences between cost and carrying amounts of invested assets, were
$191 million and $661 million for the years ended December 31, 1996
and 1995, respectively, and are reflected in "Unassigned surplus."

G. Asset valuation reserve and interest maintenance reserve - These
reserves are required for life insurance companies under NAIC
requirements. The AVR is calculated based on a statutory formula and
is designed to mitigate the effect of valuation and credit-related
losses on unassigned surplus. The IMR captures realized capital gains
and losses, net of tax, resulting from changes in the general level of
interest rates. These gains and losses are amortized into net
investment income utilizing grouped amortization schedules over the
expected remaining life of the investments sold. At December 31, 1996,
AVR is comprised of 68% for bonds, stocks, and short-term investments;
17% for mortgage loans on real estate; and 15% for real estate and
other invested assets. The IMR balance at December 31, 1996 and 1995
was $1,365 million and $1,163 million, respectively, and is recorded
in "Other liabilities". During 1996, 1995 and 1994, $327 million, $766
million and ($910) million, respectively, of net realized capital
gains (losses) were deferred and $126 million, $82 million and $102
million, respectively, was amortized and included in income.

H. Restricted assets and special deposits - Assets in the amounts of $941
million and $5,072 million at December 31, 1996 and 1995,
respectively, were on deposit with governmental authorities or
trustees as required by law. Assets valued at $2,994 million and
$3,121 million at December 31, 1996 and 1995, respectively, were
maintained as compensating balances or pledged as collateral for bank
loans and other financing agreements. Letter stock or other securities
restricted as to sale amounted to $720 million in 1996 and $354
million in 1995.

I. Loan backed and structured securities - A retrospective method is
employed to recalculate the values of the loan backed and structured
securities holdings with the exception of interest only bonds. Each
acquisition lot was reviewed to recalculate the effective yield. The
recalculated effective yield was used to derive a book value as if the
new yield were applied at the time of acquisition. Outstanding
principal

- 8 -
<PAGE>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

factors from the time of acquisition to adjustment date were used to
calculate the prepayment history for all applicable securities.
Conditional prepayment rates, computed with life to date factor
histories and weighted average maturities, were used to affect the
calculation of projected payments for pass through, interest only and
principal only security types. Interest only bond adjustments are
developed on a prospective basis with adjustments made for permanent
impairments if needed.

J. Securities lending is a program whereby the Company loans securities
to third parties, primarily major brokerage firms. As of December 31,
1996 and 1995, the estimated fair values of loaned securities were
$6,362 million and $5,939 million respectively. Company and NAIC
policies require a minimum of 102% and 105% of the fair value of the
domestic and foreign loaned securities, respectively, to be separately
maintained as collateral for the loans. Cash collateral received is
invested in short-term investments. The offsetting collateral
liability as of December 31, 1996 and 1995 is $4,813 million and
$3,625 million, respectively. Non-cash collateral is not reflected in
the Statements of Admitted Assets, Liabilities and Surplus.

5. EMPLOYEE BENEFIT PLANS

A. Pension plans - The Company has several defined benefit pension plans,
which cover substantially all of its employees. Benefits are generally
based on career average earnings and credited length of service. The
Company's funding policy for U.S. plans is to contribute annually the
amount necessary to satisfy the Internal Revenue Service contribution
guidelines.

Employee pension benefit plan status is as follows:

1996 1995
------- -------
(In Millions)
Actuarial present value of benefit obligation:

Vested benefit obligation $(3,878) $(3,270)
======= =======

Accumulated benefit obligation $(4,174) $(3,572)
======= =======

Projected benefit obligation $(4,989) $(4,330)

Plan assets at fair value 7,326 6,688
------- -------

Plan assets in excess of projected
benefit obligation 2,337 2,358

Unrecognized transition amount (769) (904)

Unrecognized prior service cost 356 199

Unrecognized net gain (916) (753)
------- -------

Prepaid pension cost $ 1,008 $ 900
======= =======
Plan assets consist primarily of equity securities, bonds, real estate
and short-term investments, of which $5,668 million and $4,788 million
are included in separate account assets and liabilities at December
31, 1996 and 1995, respectively.

The components of the net periodic pension benefit for 1996, 1995 and
1994 are as follows:
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
(In Millions)
<S> <C> <C> <C>
Service cost $ 119 $ 110 $ 141
Interest cost 336 371 293
Actual return on assets (720) (1,249) 62
Net amortization and deferral 57 604 (633)
Net curtailment gains and special termination benefits 63 0 156
------ ------ ------

Net periodic pension benefit $ (145) $ (164) $ 19
====== ====== ======
</TABLE>
The net increase to surplus relating to the Company's pension plans is
$37 million, $30 million and $0 million in 1996, 1995 and 1994,
respectively, which considers the changes in the non-admitted prepaid
pension asset of $108 million, $134 million and ($19) million,
respectively.

The accounting assumptions used by the Company were:

AS OF SEPTEMBER 30,
------------------------
1996 1995 1994
------ ------ ------

Discount rate 7.75% 7.50% 8.50%
Rate of increase in compensation levels 4.50% 4.50% 5.50%
Expected long-term rate of return on assets 9.50% 9.00% 9.00%

The Company maintains non-qualified supplemental retirement plans
providing benefits that may not be paid from the Company's two
qualified plans since qualified plans have limits imposed by Section
415 and 401(a)(17) of the Code. One of these plans also provides
certain participants with a subsidized early retirement benefit.

- 9 -
<PAGE>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

B. Postretirement benefits - The Company provides certain life insurance
and health care benefits for its retired employees. Substantially all
of the Company's employees may become eligible to receive these
benefits if they retire after age 55 with at least 10 years of
service.

Postretirement benefits are accounted for in accordance with
prescribed NAIC policy. The Company has elected to amortize its
transition obligation over 20 years. During 1996, 1995 and 1994,
funding of its postretirement benefit obligations totaled $35 million,
$47 million and $31 million, respectively.

The postretirement benefit plan status is as follows:

SEPTEMBER 30,
------------------
1996 1995
---- ----
(In Millions)

Accumulated postretirement benefit obligation for:
Retirees $(1,418) $(1,465)
Fully eligible active plan participants (35) (103)
Plan assets at fair value 1,341 1,309
------- -------
Funded status (112) (259)
Unrecognized transition amount 355 378
Unrecognized net gain (177) (19)
------- -------
Prepaid postretirement benefit cost $ 66 $ 100
======= =======

Plan assets consist of group and individual variable life insurance
policies, group life and health contracts and short-term investments,
of which $1,003 million and $990 million are included in the separate
account assets and liabilities at December 31, 1996 and 1995,
respectively.

Net periodic postretirement benefit cost for 1996, 1995 and 1994
includes the following components:

1996 1995 1994
----- ----- -----
(In Millions)

Service cost $ 24 $ 30 $ 36
Interest cost 115 117 107
Actual return on plan assets (104) (144) (98)
Amortization of transition obligation 22 22 23
Other 12 49 52
----- ----- -----
Net periodic postretirement benefit cost $ 69 $ 74 $ 120
===== ===== =====

The net reduction to surplus relating to the Company's postretirement
benefit plans is $35 million, $46 million, and $30 million in 1996,
1995 and 1994, respectively, which considers the changes in the
prepaid postretirement benefit cost of $34 million, $28 million and
$90 million in 1996 , 1995 and 1994, respectively.

The assumptions used for the postretirement benefit plan were:

AS OF SEPTEMBER 30,
---------------------------------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Discount rate 7.75% 7.50% 8.50%
Expected long-term rate of return on plan assets 9.00% 8.00% 9.00%
Rate of increase in compensation levels 4.50% 4.50% 5.50%
Health care cost trend rates 8.50-12.50% 8.90-13.30% 9.10-13.90%
Ultimate health care cost trend rate at 2006 5.00% 5.00% 6.00%
</TABLE>

A 1% increase in health care cost trend rates would increase the
September 30, 1996 accumulated postretirement benefit obligation and
service/interest costs by $115 million and $12 million, respectively.

C. Postemployment benefits - The Company accrues for postemployment
benefits primarily for life and health benefits provided to former or
inactive employees who are not retirees. The net accumulated liability
for these benefits at December 31, 1996 and 1995 was $99 million and
$96 million, respectively.

- 10 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

6. NOTES PAYABLE AND OTHER BORROWINGS

Notes payable and other borrowings consisted of the following at December
31:

Short-term: 1996 1995
---- ----
(In Millions)
Notes payable to affiliate $ 99 $ 0
Current portion of long term
notes payable 11 128
---- ----
$110 $128

Long-Term: 1996 1995
---- ----

8.173% note due 2002 $249 $249
7.501% note due 1999 248 248
5.0819% note due 2004 56 66
12.00% note due 1999 0 16
Secured demand note
due 1998 100 100
---- ----
653 679
---- ----
Total principal repayments and accrued interest $763 $807
==== ====

Scheduled principal repayments as of December 31, 1996, are as
follows: $110 million in 1997, $100 million in 1998, $239 million in
1999, $0 in 2000, $0 in 2001 and $294 million thereafter.

7. SURPLUS

A. Capital notes - The Company issues Capital Notes that are subordinate
in right of payment to policy claims, prior claims and senior
indebtedness. A summary of the outstanding Capital Notes as of
December 31, 1996 is as follows:

PRINCIPAL CARRYING INTEREST MATURITY
ISSUE DATE (PAR) AMOUNT RATE DATE
- ---------- --------- -------- -------- --------
(In Millions)
April 28, 1993 $ 300 $ 299 6.875% April 15, 2003
July 1, 1995 350 340 8.300% July 1, 2025
July 1, 1995 250 246 7.650% July 1, 2007
July 15, 1995 100 100 8.100% July 15, 2015
------- -----
Total $ 1,000 $ 985
======= =====

B. Special surplus fund - In accordance with the requirements of various
states, a special surplus fund has been established for contingency
reserves of $1,268 million and $1,274 million as of December 31, 1996
and 1995, respectively.

C. Non-admitted assets - Non-admitted assets were $1,367 million and
$1,167 million as of December 31, 1996 and 1995, respectively.

8. FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair values presented below have been determined using available
information and reasonable valuation methodologies. Considerable judgment
is applied in interpreting data to develop the estimates of fair value.
Accordingly, such estimates presented may not be realized in a current
market exchange. The use of different market assumptions and/or estimation
methodologies could have a material effect on the estimated fair values.
The following methods and assumptions were used in calculating the fair
values. (For all other financial instruments, the carrying value is a
reasonable estimate of fair value.)

Bonds and preferred stock - Fair values for bonds and preferred stock,
other than private placement securities, are based on quoted market
prices or estimates from independent pricing services. Fair values for
private placement securities are estimated using a discounted cash
flow model which considers the current market spreads between the U.S.
Treasury yield curve and corporate bond yield curve, adjusted for the
type of issue, its current credit quality and its remaining average
life. The fair value of certain non-performing private placement
securities is based on amounts provided by state regulatory
authorities.

Common stock - Fair value of unaffiliated common stock is based on
quoted market prices, where available, or prices provided by state
regulatory authorities.

- 11 -
<PAGE>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

Mortgage loans on real estate - The fair value of residential
mortgages is based on recent market trades or quotes, adjusted where
necessary for differences in risk characteristics. The fair value of
the commercial mortgage and agricultural loan portfolio is primarily
based upon the present value of the scheduled cash flows discounted at
the appropriate U.S. Treasury rate, adjusted for the current market
spread for a similar quality mortgage. For certain non-performing and
other loans, fair value is based upon the value of the underlying
collateral.

Policy loans and premium notes - The estimated fair value of policy
loans is calculated using a discounted cash flow model based upon
current U.S. Treasury rates and historical loan repayments.

Derivative financial instruments - The fair value of swap agreements
is estimated based on the present value of future cash flows under the
agreements discounted at the applicable zero coupon U.S. Treasury rate
and swap spread. The fair value of forwards, futures and options is
estimated based on market quotes for a transaction with similar terms.
The fair value of loan commitments is derived by comparing the
contractual future stream of fees with such fee streams adjusted to
reflect current market rates that would be applicable to instruments
of similar type, maturity and credit standing.

Investment-type insurance contract liabilities - Fair values for the
Company's investment-type insurance contract liabilities are estimated
using a discounted cash flow model, based on interest rates currently
being offered for similar contracts. Carrying amounts are included in
"Future policy benefits and claims."

Notes payable and other borrowings - The estimated fair value of notes
payable is derived using discount rates based on the borrowing rates
currently available to the Company for debt with similar terms and
remaining maturities.

The following table discloses the carrying amounts and estimated fair
values of the Company's financial instruments at December 31:

<TABLE>
<CAPTION>
1996 1995
---- ----
CARRYING ESTIMATED CARRYING ESTIMATED
AMOUNT FAIR VALUE AMOUNT FAIR VALUE
------ ---------- ------ ----------
(In Millions)
FINANCIAL ASSETS:

<S> <C> <C> <C> <C>
Bonds $75,006 $77,826 $77,494 $83,910
Preferred stock 239 259 396 410
Common stock * 2,466 2,466 1,805 1,805
Mortgage loans on real estate 17,039 17,364 20,280 20,839
Policy loans and premium notes 6,023 5,942 6,208 6,452
Short-term investments 5,817 5,817 4,633 4,633
Cash 165 165 170 170
Assets held in separate accounts 57,797 57,797 53,903 53,903
Derivative financial instruments 9 16 15 64

FINANCIAL LIABILITIES:

Investment-type insurance
contracts 30,194 30,328 34,799 35,720
Notes payable and other borrowings 763 794 807 829
Liabilities related to separate accounts 57,436 57,436 53,256 53,256
Derivative financial instruments 60 63 94 108
</TABLE>

* Excludes investments in subsidiaries of $4,610 million and $4,328 million
at December 31, 1996 and 1995, respectively.

- 12 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

9. DERIVATIVE AND OFF-BALANCE SHEET CREDIT-RELATED INSTRUMENTS

A. Derivative financial instruments - Derivatives include swaps,
forwards, futures, options and fixed-rate loan commitments subject to
market risk, all of which are used by the Company in the normal course
of business in activities other than trading. The Company does not
issue or hold derivatives for trading purposes. This classification is
based on management's intent at the time of contract inception and
throughout the life of the contract. The Company uses derivatives
primarily for asset/liability risk management and to reduce exposure
to interest rate, currency and other market risks. Of those
derivatives held at December 31,1996, 35% of the notional amounts
consisted of interest rate derivatives and 65% consisted of foreign
currency derivatives.

The tables below summarize the Company's outstanding positions on a
gross basis before netting pursuant to rights of offset, qualifying
master netting agreements with counterparties or collateral
arrangements at December 31:

<TABLE>
<CAPTION>
DERIVATIVE FINANCIAL INSTRUMENTS
1996 1995
---- ----
(In Millions)
CARRYING ESTIMATED CARRYING ESTIMATED
NOTIONAL AMOUNT FAIR VALUE NOTIONAL AMOUNT FAIR VALUE
-------- ------ ---------- -------- ------ ----------
<S> <C> <C> <C> <C> <C> <C>
Swaps:
Assets $ 159 $ 1 $ 6 $ 418 $ (1) $ 32
Liabilities 479 50 53 371 76 79

Forwards:
Assets 453 8 8 235 13 17
Liabilities 980 9 9 1,074 13 13

Futures:
Assets 0 0 0 683 5 5
Liabilities 399 1 1 864 5 7

Options:
Assets 175 0 0 195 0 0
Liabilities 0 0 0 3 0 0

Loan Commitments:
Assets 164 0 2 122 (2) 10
Liabilities 9 0 0 532 0 9
------ ------ ------ ------ ------ ------

Total:
Assets $ 951 $ 9 $ 16 $1,653 $ 15 $ 64
====== ====== ====== ====== ====== ======

Liabilities $1,867 $ 60 $ 63 $2,844 $ 94 $ 108
====== ====== ====== ====== ====== ======
</TABLE>

B. Off-balance sheet credit-related instruments - During the normal
course of its business, the Company utilizes financial instruments
with off-balance sheet credit risk such as commitments, financial
guarantees and letters of credit. Commitments include variable rate
commitments to purchase and sell mortgage loans and the unfunded
portion of commitments to fund investments in private placement
securities. The Company also provides financial guarantees incidental
to other transactions and letters of credit that guarantee the
performance of customers to third parties. These credit-related
financial instruments have off-balance sheet credit risk because only
their origination fees, if any, and accruals for probable losses, if
any, are recognized until the obligation under the instrument is
fulfilled or expires. These instruments can extend for several years
and expirations are not concentrated in any period. The Company seeks
to control credit risk associated with these instruments by limiting
credit, maintaining collateral where customary and appropriate, and
performing other monitoring procedures.

The notional amount of these instruments, which represents the
Company's maximum exposure to credit loss from other parties'
non-performance, was $785 million and $1,254 million at December 31,
1996 and 1995, respectively. Because many of these amounts expire
without being advanced in whole or in part, the notional amounts do
not represent future cash flows.

The estimated fair value of these instruments, which represents the
Company's current exposure to credit loss from other parties'
non-performance, was $8 million and $56 million at December 31, 1996
and 1995, respectively.

10. RELATED PARTY TRANSACTIONS

A. Service agreements - The Company has entered into service agreements
with various subsidiaries. Under these agreements, the Company
furnishes services of officers and employees and provides supplies,
use of equipment, office space, and makes payment to

- 13 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

third parties for general expenses, state and local taxes. The
agreements obligate the subsidiaries to reimburse the Company for the
approximate cost of providing such services. The amounts receivable
from subsidiaries, reported in "Other assets" at December 31, 1996 and
1995, were $490 million and $509 million, respectively. The
subsidiaries also furnish similar services to the Company in
connection with such agreements. The amount payable to subsidiaries,
reported in "Other liabilities" at December 31, 1996 was $87 million.
There was no outstanding balance at December 31, 1995.

Certain of the Company's group health care subsidiaries provide health
insurance to certain employees of the Company. Enrollment contract
costs reported in "Other expenses" were $126 million, $111 million and
$104 million for the years ended December 31, 1996, 1995 and 1994,
respectively.

The Company purchases corporate owned life insurance policies from one
of its life insurance subsidiaries for certain employees. The premium
charged for these policies reported in "Other expenses" was $3
million, $12 million and $12 million for the years ended December 31,
1996, 1995 and 1994, respectively. The cash value associated with
these policies was $118 million and $102 million at December 31,
1996 and 1995, respectively.

Certain of the Company's subsidiaries perform services for the Company
in connection with the Company's obligations under investment advisory
or subadvisory agreements. The costs incurred in connection with
performing such services, primarily reported in "Other expenses," were
$145 million, $327 million and $342 million for the years ended
December 31, 1996, 1995 and 1994, respectively. The Company also
provides these services to subsidiaries in connection with such
agreements. The investment advisory fees received from affiliates by
the Company, reported in "Other income" were $161 million, $92 million
and $110 million for the years ended December 31, 1996, 1995 and 1994,
respectively.

The Company borrows short-term funds from Prudential Funding
Corporation ("Funding"), a wholly owned subsidiary. The interest
expense for these borrowings was $131 million, $66 million and $21
million for the years ended December 31, 1996, 1995 and 1994,
respectively. The outstanding balance at December 31, 1996 was $99
million. There was no outstanding balance at December 31, 1995.

B. Net worth maintenance agreement - The Company has entered into a
support agreement with Funding under which it agrees to maintain
Funding's tangible net worth, including subordinated debt, at not less
than $1.00. As of December 31, 1996, the tangible net worth of Funding
was $44 million. Since the inception of the agreement, no support
payments have been required.

11. CONTINGENCIES

The Company is reviewing its obligations under certain managed care
arrangements for possible failure to comply with contractual and regulatory
requirements. It is the opinion of management that appropriate reserves
have been established in accordance with applicable accounting standards to
provide for appropriate reimbursements to customers.

Various lawsuits against the Company have arisen in the course of the
Company's business. In certain of these matters, large and/or indeterminate
amounts are sought.

Twenty-six purported class actions and over 280 individual actions are
pending against the Company on behalf of those persons who purchased life
insurance policies allegedly because of deceptive sales practices engaged
in by the Company and its insurance agents in violation of state and
federal laws. The Company anticipates additional suits may be filed by
individuals who opted out of the class action settlement described below.
The sales practices alleged to have occurred are contrary to Company
policy. Some of these cases seek very substantial damages while others seek
unspecified compensatory, punitive and treble damages. The Company intends
to defend these cases vigorously.

A Multi-State Life Insurance Task Force (the "Task Force"), comprised of
insurance regulators from 29 states and the District of Columbia, was
created to conduct a review of sales and marketing practices throughout the
life insurance industry. As the largest life insurance company in the
United States, the Company was the initial focus of the Task Force
examination. On July 9, 1996, the Task Force released its report on the
Company's activities. In it, the Task Force found that some sales of life
insurance policies made by the Company were improper. The report criticizes
the Company's training, oversight, discipline and compliance programs
related to insurance sales. Based on these findings, the Task Force
recommended, and the Company agreed to, a series of fines allocated to all
50 states and the District of Columbia amounting to a total of $35 million.
In addition, the Task Force recommended a remediation program pursuant to
which the Company would offer relief to policyowners who purchased 10.7
million whole life insurance policies in the United States from the Company
from 1982 through 1995. In subsequent negotiations with several states, the
Company agreed to pay additional amounts aggregating approximately $30
million by way of fine, reimbursement of investigation expenses and costs
associated with outreach to residents of Florida and California.

On October 28, 1996, the Company entered into a Stipulation of Settlement
with attorneys for the plaintiffs in the class actions consolidated in a
Multi-District Litigation involving alleged improprieties in connection
with the Company's sale of whole life

- 14 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

insurance policies from 1982 through 1995. Pursuant to the proposed
settlement, the Company has agreed to provide certain enhancements and
changes to the remediation program previously accepted by the Multi-State
Task Force, including some additional remedies. In addition, the Company
agreed that a minimum cost of $410 million (which was recorded in the
Statement of Operations and Changes in Surplus) would be incurred in
providing remedies to policyowners under the program, and agreed to certain
other payments and guarantees. Under the terms of the guarantees, the
Company has agreed that the average cost per remedy will not be less than
$2,364 for up to 330,000 claims remedied. For claims remedied in excess of
330,000, the Company has not guaranteed an average cost per remedy. The
Company has also agreed to provide additional compensation to be
distributed by formula that will range in an aggregate amount from $50
million to $300 million depending on the total number of claims remedied.
The Company cannot predict how many claims ultimately will be remedied. The
Company has also recorded in the Statement of Operations and Changes in
Surplus, its estimate of the minimum administrative costs related to the
remediation program. As of March 5, 1997, all 50 states and the District of
Columbia have directed the Company to offer a remediation plan based on the
program accepted by the Task Force and containing many of the enhancements
of the class action settlement.

Also on October 28, 1996, the U.S. District Court of the District of New
Jersey, in which the Multi-District Litigation is pending, conditionally
certified a class for settlement purposes and scheduled a hearing on the
fairness, reasonableness and adequacy of the proposed settlement. This
hearing was held on February 24, 1997. On March 7, 1997, the Court
rendered its decision approving the settlement. The owners of approximately
23,000 policies have taken steps to exclude themselves from the class
action and are not bound by the settlement.

To date, the Company has mailed packages to 8.5 million policyowners
eligible for the remediation program, informing policyowners in all 50
states and the District of Columbia of their rights under the program. The
deadline for electing to participate in the Alternative Dispute Resolution
Process ("ADR") or Basic Claim Relief is June 1, 1997. Policyowners who
believe that they were misled can file a claim through the ADR.
Policyowners who do not believe they were misled, or who do not wish to
file a claim under the ADR, may choose from several options available under
Basic Claim Relief, such as preferred rate premium loans, or the purchase
of enhanced annuities, mutual fund shares or life insurance policies.

It is not possible on any reliable basis to estimate how many policyowners
will participate in the settlement. The cost of the settlement is dependent
upon complex and varying factors, including the number of policyowners that
participate in the settlement, the relief options chosen and the ultimate
dollar value of the settlement. The administrative costs to the Company of
remediation of policyowner claims are also subject to a number of complex
uncertainties in addition to the unknown quantity and cost of policyowner
claims. In light of the uncertainties attendant to these and other factors,
management is unable to make a reasonable estimate of the ultimate cost of
the remediation program to the Company.

A purported class action was brought against the Company and certain
subsidiaries alleging common law fraud, negligent misrepresentation and
violations of the New Jersey RICO statute arising out of the plaintiffs'
purchase of certain subordinated mortgage pass-through securities and
seeking compensatory and punitive damages and injunctive relief. The
Company will deny the substantive allegations of the complaint in its
answer and will vigorously defend the suit. The case is at a preliminary
stage, and management is not now in a position to predict the outcome or
effect of the litigation.

Litigation is subject to many uncertainties, and given the complexity and
scope of these suits, their outcome cannot be predicted. It is also not
possible to predict the likely results of any regulatory inquiries or their
effect on litigation which might be initiated in response to widespread
media coverage of these matters. Accordingly, management is unable to make
a meaningful estimate of the amount or range of loss that could result from
an unfavorable outcome of all pending litigation and the regulatory
inquiries. It is possible that the results of operations or the cash flow
of the Company, in particular quarterly or annual periods, could be
materially affected by an ultimate unfavorable outcome of certain pending
litigation and regulatory matters. Management believes, however, that the
ultimate outcome of all pending litigation and regulatory matters referred
to above should not have a material adverse effect on the Company's
financial position, after consideration of applicable reserves.

In 1993, Prudential Securities, Inc. ("PSI"), a subsidiary of Prudential,
entered into an agreement with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and state securities
commissions whereby PSI agreed to pay $330 million into a settlement fund
to pay eligible claims on certain limited partnership matters. Under this
agreement, if partnership matter claims exceed the established settlement
fund, PSI is obligated to pay such additional claims. The agreement also
required PSI to take measures to enhance the adequacy of its sales
practices compliance controls.

In October 1994, the United States Attorney for the Southern District of
New York (the "U.S. Attorney") filed a complaint against PSI in connection
with its sale of certain limited partnerships. Simultaneously, PSI entered
into an agreement to comply with certain conditions for a period of three
years, and to pay an additional $330 million into the settlement fund. At
the end of the three year period, assuming PSI has fully complied with the
terms of the agreement, the U.S. Attorney will institute no further action.
In the opinion of management, PSI is in compliance with all provisions of
the aforementioned agreements.

- 15 -
<PAGE>

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

NOTES TO STATUTORY FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

The Company has entered into a reinsurance agreement with The Prudential
Life Insurance Company, Ltd., a wholly owned subsidiary, under which it has
agreed to reinsure certain individual life insurance policies through a
yearly renewable term contract. The reinsurance assumed premiums and
reserves for 1996 were $27 million and $17 million, respectively.

The Company as a result of the sale of Prudential Reinsurance Inc. (a PRUCO
Inc. subsidiary), agreed to guarantee up to $775 million of Gibraltar
Casualty Company (a Prudential subsidiary) obligations with respect to a
Stop Loss Agreement and PRUCO Inc.'s (a Prudential subsidiary) payment
obligations under an Indemnity Agreement, subject to maximum aggregate
payments of $400 million. The maximum aggregate payments under the
Prudential Guarantee of the Gibraltar Casualty Company obligations will be
reduced in certain circumstances to take account of payments made and
collateral provided in respect of the guaranteed obligations. The Stop Loss
Agreement is intended to mitigate the impact on Prudential Reinsurance Inc.
of adverse development of loss reserves, as of June 30, 1995, of up to $375
million of the first $400 million of adverse development. The Company has
recorded a loss reserve of $175 million as of December 31, 1996.

Gibraltar Casualty Company and other property and casualty insurance
subsidiaries receive claims under expired contracts which assert alleged
injuries and/or damages relating to or resulting from toxic torts, toxic
waste and other hazardous substances. The liabilities for such claims
cannot be estimated by traditional reserving techniques. As a result of
judicial decisions and legislative actions, the coverage afforded under
these contracts may be expanded beyond their original terms. Extensive
litigation between insurers and insureds over these issues continues and
the outcome is not predictable. In establishing the unpaid claim reserves
for these losses, management considered the available information and
established these reserves in accordance with applicable accounting
standards. However, given the expansion of coverage and liability by the
courts and legislatures in the past, and potential for other unfavorable
trends in the future, the ultimate cost of these claims could increase from
the levels currently established.

The Company and a number of other insurers (the "Consortium") entered into
a Reinsurance and Participation Agreement ("the Agreement") with MBL Life
Assurance Corporation ("MBLLAC") and others, under which the Company and
the other insurers agreed to reinsure certain payments to be made to
contractholders by MBLLAC in connection with the plan of rehabilitation of
Mutual Benefit Life Insurance Company. Under the Agreement, the Consortium,
subject to certain terms and conditions, will indemnify MBLLAC for the
ultimate net loss sustained by MBLLAC on each contract subject to the
Agreement. The ultimate net loss represents the amount by which the
aggregate required payments exceed the fair market value of the assets
supporting the covered contracts at the time such payments are due. The
Company's share of any net loss is 30.55%. The Company has determined that
it does not expect to make any payments to MBLLAC under the agreement. The
Company concluded this after testing a wide range of potentially adverse
scenarios during the rehabilitation period for MBLLAC.

******

- 16 -
<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Policyholders of
The Prudential Insurance Company of America

We have audited the accompanying statement of admitted assets, liabilities and
surplus (statutory basis) of The Prudential Insurance Company of America as of
December 31, 1996, and the related statements of operations and changes in
surplus (statutory basis), and of cash flows (statutory basis) for the year 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 audit.

We conducted our audit 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 audit provides a reasonable basis for our opinion.

As described in Note 1, these financial statements were prepared in conformity
with accounting practices prescribed or permitted by the New Jersey Department
of Insurance, which practices differ from generally accepted accounting
principles. The effects on the financial statements of the variances between the
statutory basis of accounting and generally accepted accounting principles,
although not reasonably determinable, are presumed to be material.

In our opinion, because of the effects of the matters referred to in the
preceding paragraph, the financial statements referred to above do not present
fairly, in conformity with generally accepted accounting principles, the
financial position of The Prudential Insurance Company of America at December
31, 1996, and the results of its operations and its cash flows for the year then
ended.

Also, in our opinion, the financial statements referred to above present fairly,
in all material respects, the admitted assets, liabilities and surplus of The
Prudential Insurance Company of America at December 31, 1996, and the results of
its operations and its cash flows for the year then ended, on the basis of
accounting described in Note 1.

/s/ PRICE WATERHOUSE, LLP
New York, New York

March 10, 1997

- 17 -

<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
The Prudential Insurance Company of America
Newark, New Jersey

We have audited the accompanying statement of admitted assets, liabilities and
surplus--statutory basis of The Prudential Insurance Company of America as of
December 31, 1995, and the related statements of operations and changes in
surplus--statutory basis, and cash flows--statutory basis for each of the two
years in the period ended December 31, 1995. 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 report dated March 1, 1996, we expressed an opinion that the 1995 and
1994 financial statements, prepared using accounting practices prescribed and
permitted by the New Jersey Department of Insurance, presented fairly, in all
material respects, the financial position of The Prudential Insurance Company of
America as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally accepted
accounting principles. As described in Note 1 to these financial statements,
pursuant to the pronouncements of the Financial Accounting Standards Board, the
1995 and 1994 financial statements of The Prudential Insurance Company of
America, prepared using accounting practices prescribed or permitted by
insurance regulators (statutory financial statements) are no longer considered
presentations in conformity with generally accepted accounting principles. The
effects on the financial statements of the differences between the statutory
basis of accounting and generally accepted accounting principles are material
and are also described in Note 1. Accordingly, our present opinion on the
presentation of the 1995 and 1994 financial statements in accordance with
generally accepted accounting principles, as presented herein, is different from
that expressed in our previous report.

In our opinion, because of the effects of the matter discussed in the third
paragraph, the financial statements referred to above do not present fairly, in
conformity with generally accepted accounting principles, the admitted assets,
liabilities and surplus of the Company as of December 31, 1995, and its
operations, changes in surplus and its cash flows for each of the two years in
the period ended December 31, 1995.

However, in our opinion, the financial statements referred to above present
fairly, in all material respects, the admitted assets, liabilities and surplus
of The Prudential Insurance Company of America as of December 31, 1995, and the
results of its operations, changes in surplus and its cash flows for each of the
two years in the period then ended, on the basis of accounting described in Note
1.

Also, as described in Note 1 to the financial statements, these financial
statements were prepared on an unconsolidated statutory basis of accounting,
which differs from the 1995 and 1994 financial statements prepared for general
distribution on a consolidated statutory basis of accounting, both of which
differ from generally accepted accounting principles. The financial statements
for 1995 and 1994 have been restated on an unconsolidated statutory basis of
accounting adopted in 1996 for purposes of general distribution. Further, these
financial statements differ from the previously issued unconsolidated statutory
financial statements because certain permitted financial statement presentation
practices are no longer being used.

/s/ DELOITTE & TOUCHE LLP
Parsippany, New Jersey

March 1, 1996, except for Note 1A,
as to which the date is March 10, 1997

- 18 -

<PAGE>

PART II

OTHER INFORMATION

<PAGE>

UNDERTAKING TO FILE REPORTS

Subject to the terms and conditions of Section 15(d) of the Securities Exchange
Act of 1934, the undersigned Registrant hereby undertakes to file with the
Securities and Exchange Commission such supplementary and periodic information,
documents, and reports as may be prescribed by any rule or regulation of the
Commission heretofore or hereafter duly adopted pursuant to authority conferred
in that section.

REPRESENTATION WITH RESPECT TO CHARGES

The Prudential Insurance Company of America ("Prudential") represents that the
fees and charges deducted under the Group Variable Universal Life Insurance
Contracts registered by this registration statement, in the aggregate, are
reasonable in relation to the services rendered, the expenses expected to be
incurred, and the risks assumed by Prudential.

UNDERTAKING WITH RESPECT TO INDEMNIFICATION

Prudential Directors' and Officers' Liability and Corporation Reimbursement
Insurance program, purchased by Prudential from Aetna Casualty & Surety Company,
CNA Insurance Companies, Lloyds of London, Great American Insurance Company,
Reliance Insurance Company, Corporate Officers & Directors Assurance Ltd.,
A.C.E. Insurance Company, Ltd., XL Insurance Company, Ltd., and Zurich-American
Insurance Company, provides reimbursement for "Loss" (as defined in the
policies) which the Company pays as indemnification to its directors or officers
resulting from any claim for any actual or alleged act, error, misstatement,
misleading statement, omission, or breach of duty by persons in the discharge of
their duties in their capacities as directors or officers of Prudential, any of
its subsidiaries, or certain investment companies affiliated with Prudential.
Coverage is also provided to the individual directors or officers for such Loss,
for which they shall not be indemnified. Loss essentially is the legal liability
on claims against a director or officer, including adjudicated damages,
settlements and reasonable and necessary legal fees and expenses incurred in
defense of adjudicatory proceedings and appeals therefrom. Loss does not include
punitive or exemplary damages or the multiplied portion of any multiplied damage
award, criminal or civil fines or penalties imposed by law, taxes or wages, or
matters which are uninsurable under the law pursuant to which the policies are
construed.

There are a number of exclusions from coverage. Among the matters excluded are
Losses arising as the result of (1) claims brought about or contributed to by
the criminal, dishonest or fraudulent acts or omissions or the willful violation
of any law by a director or officer, (2) claims based on or attributable to
directors or officers gaining personal profit or advantage to which they were
not legally entitled, and (3) claims arising from actual or alleged performance
of, or failure to perform, services as, or in any capacity similar to, an
investment adviser, investment banker, underwriter, broker or dealer, as those
terms are defined in the Securities Act of 1933, the Securities Exchange Act of
1934, the Investment Advisers Act of 1940, the Investment Company Act of 1940,
any rules or regulations thereunder, or any similar federal, state or local
statute, rule or regulation.

The limit of coverage under the program for both individual and corporate
reimbursement coverage is $150,000,000. The retention for corporate
reimbursement coverage is $10,000,000 per loss.

The relevant provisions of New Jersey law permitting or requiring
indemnification, New Jersey being the state of organization of Prudential, can
be found in Section 14A:3-5 of the New Jersey Statutes Annotated. The text of
Prudential's by-law 26, which relates to indemnification of officers and
directors, is incorporated by reference to Exhibit 1.A.(6)(b) of Post-Effective
Amendment No. 1 to Form S-6, Registration No. 33-61079, filed April 25, 1996, on
behalf of The Prudential Variable Appreciable Account.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

II-1

<PAGE>

CONTENTS OF REGISTRATION STATEMENT

This Registration Statement comprises the following papers and documents:
- -------------------------------------------------------------------------

The facing sheet.

Cross-reference to items required by Form N-8B-2.

The prospectus consisting of 70 pages.

The undertaking to file reports.

The representation with respect to charges.

The undertaking with respect to indemnification.

The signatures.

Written consents of the following persons:

1. Deloitte & Touche LLP, independent auditors.
2. Price Waterhouse LLP, independent accountants.
3. Clifford E. Kirsch, Esq.
4. Stuart L. Liebeskind, FSA, MAAA.

The following exhibits:
- -----------------------

1. The following exhibits correspond to those required by paragraph A of
the instructions as to exhibits in Form N-8B-2:

A. (1) Resolutions of Board of Directors of The Prudential Insurance
Company of America:

(a) Resolution establishing The Prudential Variable
Contract Account GI-2. (Note 2)

(b) Amendment to the Resolution proposing investment in
unaffiliated mutual funds for the Prudential Variable
Contract Account GI-2. (Note 6)

(2) Not Applicable.

(3) Distribution Contracts:

(a) Distribution Agreement between Prudential Investment
Management Services LLC and The Prudential Insurance
Company of America. (Note 1)

(b) Proposed form of Agreement between Prudential
Investment Management Services LLC and independent
brokers with respect to the Sale of the Group Contracts
and Certificates. (Note 6)

(4) Not Applicable.

(5) (a) Group Contract. (Note 1)

(b) Individual Certificate. (Note 1)

(6) (a) Charter of The Prudential Insurance Company of America,
as amended November 14, 1995. (Note 3)

(b) By-laws of The Prudential Insurance Company of America,
as amended April 8, 1997. (Note 4)

(7) Not Applicable.

(8) Not Applicable.

(9) Not Applicable.

(10) (a) Application Form for Group Contract. (Note 2)

(b) Enrollment Form for Certificate. (Note 6)

2. Opinion and Consent of Clifford Kirsch, Esq. as to the legality of the
securities being registered. (Note 1)

3. None.

4. Not Applicable.

5. Not Applicable.

6. Opinion and Consent of Stuart L. Liebeskind, FSA, MAAA, as to
actuarial matters pertaining to the securities being registered.
(Note 1)

II-2

<PAGE>

7. Powers of Attorney:

(a) F. Agnew, F. Becker, M. Berkowitz, J.Cullen
C. Davis, R. Enrico, A. Gilmour, W. Gray, III, M. Grier
J. Hanson, C. Horner, B. Malkiel, A. Ryan, C. Sitter
D. Staheli, R. Thomson, J. Unruh, P. Vagelos
S. Van Ness, P. Volcker, J. Williams (Note 5)

(b) G. Hiner, Jr. (Note 4)

8. Memorandum describing Prudential's issuance, transfer, and redemption
procedures for the Certificates pursuant to Rule 6e-3(T)(b)(12)(iii)
(Note 5)

(Note 1) Filed herewith.

(Note 2) Incorporated by reference to Registrant's Form S-6, filed
February 16, 1996.

(Note 3) Incorporated by reference to Post-Effective Amendment No. 9 to
Form S-1, Registration No.33-20083, filed April 9, 1997, on
behalf of The Prudential Variable Contract Real Property Account.

(Note 4) Incorporated by reference to Post-Effective Amendment No. 12 to
Form N-4, Registration No. 33-25434, filed on or about April 25,
1997, on behalf of The Prudential Individual Variable Contract
Account.

(Note 5) Incorporated by reference to Pre-Effective Amendment No. 1 to
this registration statement filed August 22, 1996.

(Note 6) Incorporated by reference to Pre-Effective Amendment No. 2 to
this registration statement filed January 27, 1997.

II-3

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant, The
Prudential Variable Contract Account GI-2, has duly caused this Pre-Effective
Amendment No. 3 to the Registration Statement to be signed on its behalf by the
undersigned thereunto duly authorized, and its seal hereunto affixed and
attested, all in the city of Newark and the State of New Jersey, on this 25th
day of April, 1997.

(Seal) THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT GI-2
(Registrant)

By: THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(Depositor)

Attest: /s/ JOHN SIEB By: /s/ STUART L. LIEBESKIND
----------------- --------------------------
John Sieb Stuart L. Liebeskind, FSA, MAAA
Director, Prudential Vice President and Assistant
Group Life Insurance Actuary

Pursuant to the requirements of the Securities Act of 1933, this Pre-Effective
Amendment No. 3 to the Registration Statement has been signed below by the
following persons in the capacities indicated on this 25th day of April, 1997.

SIGNATURE AND TITLE

/s/ *
- -------------------------------------
Arthur F. Ryan
Chairman of the Board, President and
Chief Executive Officer

/s/ *
- -------------------------------------
Martin A. Berkowitz
Senior Vice President and Comptroller

/s/ * *By: /s/ C. CHRISTOPHER SPRAGUE
- ------------------------------------- -------------------------------------
Mark B. Grier C. Christopher Sprague
Principal Financial Officer (Attorney-in-Fact)

/s/ *
- -------------------------------------
Franklin E. Agnew
Director

/s/ *
- -------------------------------------
Frederic K. Becker
Director

/s/ *
- -------------------------------------
James G. Cullen
Director

/s/ *
- -------------------------------------
Carolyne K. Davis
Director

/s/ *
- -------------------------------------
Roger A. Enrico
Director

/s/ *
- -------------------------------------
Allan D. Gilmour
Director

II-4

<PAGE>

/s/ *
- -------------------------------------
William H. Gray, III
Director

/s/ *
- -------------------------------------
Jon F. Hanson
Director

/s/ *
- -------------------------------------
Glen H. Hiner, Jr.
Director

/s/ * *By: /s/ C. CHRISTOPHER SPRAGUE
- ------------------------------------- ---------------------------------
Constance J. Horner C. Christopher Sprague
Director (Attorney-in-Fact)

- -------------------------------------
Gaynor N. Kelley
Director

/s/ *
- -------------------------------------
Burton G. Malkiel
Director

- -------------------------------------
Ida F. S. Schmertz
Director

/s/ *
- -------------------------------------
Charles R. Sitter
Director

/s/ *
- -------------------------------------
Donald L. Staheli
Director

/s/ *
- -------------------------------------
Richard M. Thomson
Director

/s/ *
- -------------------------------------
James A. Unruh
Director

/s/ *
- -------------------------------------
P. Roy Vagelos, M.D.
Director

/s/ *
- -------------------------------------
Stanley C. Van Ness
Director

/s/ *
- -------------------------------------
Paul A. Volcker
Director

/s/ *
- -------------------------------------
Joseph H. Williams
Director

II-5

<PAGE>

EXHIBIT INDEX
<S> <C> <C>
Consent of Deloitte & Touche LLP, independent auditors. Page II-7

Consent of Price Waterhouse LLP, independent accountants. Page II-8

1.A.(3)(a) Distribution Agreement between Prudential Investment Page II-9
Management Services LLC and The Prudential Insurance
Company of America.

1.A.(5)(a) Group Contract. Page II-14

1.A.(5)(b) Individual Certificate. Page II-27

3. Opinion and Consent of Clifford E. Kirsch, Esq., as to the Page II-76
legality of the securities being registered.

6. Opinion and Consent of Stuart L. Liebeskind, FSA, MAAA, as Page II-77
to actuarial matters pertaining to the securities being
registered.

</TABLE>

II-6

INDEPENDENT AUDITORS' CONSENT
- -----------------------------

We consent to the use in this Pre-Effective Amendment No.3 on Form S-6 to the
Registration Statement No. 333-01031 of The Prudential Variable Contract Account
GI-2 of The Prudential Insurance Company of America of our report dated March 1,
1996, except for Note 1A, as to which the date is March 10, 1997, relating to
the statutory financial statements of The Prudential Insurance Company of
America in the Prospectus, which is part of such Registration Statement, and to
the reference to us under the heading "Experts" in such Prospectus.

/s/ Deloitte & Touche LLP
Parsippany, New Jersey
April 25, 1997

II-7

CONSENT OF INDEPENDENT ACCOUNTANTS
- ----------------------------------

We hereby consent to the use in the Prospectus constituting part of this Pre-
Effective Amendment No. 3 to the registration statement on Form S-6 (the
"Registration Statement") of our report dated March 10, 1997, relating to the
statutory financial statements of Prudential Insurance Company of America, which
appears in such Prospectus.

We also consent to the referance to us under the heading "Experts" in the
Prospectus.

/s/PRICE WATERHOUSE LLP

1177 Avenue of the Americas
New York, New York 10036
April 24, 1997

II-8

EXHIBIT 1.A.(3)(a)

DISTRIBUTION AGREEMENT

AGREEMENT made this 17th day of March, 1997, by and between The Prudential
Insurance Company of America (the "Company"), a New Jersey corporation on its
own behalf and on behalf of Prudential Variable Contract Account GI-2 (the
"Account") and Prudential Investment Management Services LLC (the
"Distributor"), a Delaware limited liability company.

WITNESSETH:

WHEREAS, the Company has established and maintains the Account, a
investment account, pursuant to the laws of New Jersey for the purpose of
providing a choice of variable investment options under group life insurance
contracts (the "Contracts"), to commence after the effectiveness of the
Registration Statement filed with the Securities and Exchange Commission on Form
S-6 pursuant to the Securities Act of 1933, as amended (the "Securities Act");

WHEREAS, the Account is registered as a unit investment trust under the
Investment Company Act of 1940 (the "Investment Company Act");

WHEREAS, the Distributor is a broker-dealer registered with the Securities
and Exchange Commission (the "Commission") under Section 15(b) of the Securities
Exchange Act of 1934 (the "Exchange Act") and is a member of the National
Association of Securities Dealers, Inc. (the "NASD"); and

WHEREAS, the Company and the Distributor wish to enter into an agreement to
have the Distributor act as the Company's principal underwriter for the sale of
Contracts and the distribution of certificates of participation (the
"Certificates") in the Contracts;

NOW THEREFORE, the parties agree as follows:

1. APPOINTMENT OF THE DISTRIBUTOR

The Company agrees that during the term of this Agreement it will take all
action required to cause the Contracts to comply with all applicable federal and
state laws and regulations. During the term of this Agreement, the Company
appoints the Distributor and the Distributor agrees to act as the principal
underwriter for the sale of Contracts, as well as the Certificates issued
thereunder, in each state and other jurisdictions in which such Contracts may
lawfully be sold. Distributor shall offer the Contracts for sale and distribute
Certificates at premium rates set by the Company. Applications for the Contracts
and the underlying Certificates shall be solicited only by representatives of
Distributor duly qualified and appropriately licensed in each state or other
jurisdiction where they solicit such applications. Company shall appoint
Distributor's qualified representatives as life insurance agents of Company.
Completed applications for Contracts and the underlying Certificates shall be
transmitted directly to the Company for acceptance or rejection in accordance
with underwriting rules established by the Company. Initial premium payments for
the Certificates under the Contracts shall be made by check payable to the
Company and shall be held

II-9
<PAGE>

at all times by Distributor or its representatives in a fiduciary capacity and
remitted promptly to the Company. Anything in this Agreement to the contrary
notwithstanding, the Company retains the ultimate right to control the sale of
the Contracts, as well as the Certificates issued thereunder, and to appoint and
discharge life insurance agents of the Company. The Distributor shall be held to
the exercise of reasonable care in carrying out the provisions of this
Agreement.

2. SALES AGREEMENTS

Distributor is hereby authorized to enter into separate written agreements,
on such terms and conditions as Distributor may determine not inconsistent with
this Agreement, with one or more organizations which agree to participate in the
distribution of the Contracts and Certificates under the Contracts. Such
organization (hereafter "Broker") shall be registered with the Commission under
Section 15(b) of the Exchange Act and with the NASD as a member firm. Broker and
its representatives soliciting applications for Contracts and Certificates shall
be duly and appropriately licensed, registered, or otherwise qualified for the
sale of such Contracts and Certificates (and the riders and other policies
offered in connection therewith) under the insurance laws and any applicable
blue-sky laws of each state or other jurisdiction in which the Broker or its
representatives solicit such sales.

Broker shall assume any legal responsibilities of Company for the acts,
commissions or defalcations of such representatives insofar as they relate to
the sale of the Contracts and Certificates. Applications Contracts and
Certificates solicited by such Broker through its representatives shall be to
the Company, and if received by Distributor, shall be forwarded to Company. All
premium payments under the Contracts shall be made by check to Company and, if
received by Broker, shall be held at all times in a fiduciary capacity and
remitted promptly to Company.

3. LIFE INSURANCE LICENSING

Company shall be responsible for insuring that Brokers are duly qualified,
under the insurance laws of the applicable jurisdictions, to sell the Contracts
and Certificates.

4. SUITABILITY

Parties to this Agreement are prohibited from recommending the purchase of
investment options or interests in the Account to prospective Contract holders
and Certificates purchasers. Such prohibition also shall extend to
contributions, transfers, exchanges, and redemptions by Certificate purchasers
of investment options or interests in the Account. Parties shall take reasonable
steps to ensure that their representatives and associates refrain from making
the aforementioned recommendations.

Parties to this Agreement shall take reasonable steps to ensure that they
will offer Certificates that are appropriate to the needs of the prospective
Certificate purchasers. While not limited to the

II-10
<PAGE>

following, a determination of appropriateness shall be based on information
furnished to the parties after reasonable inquiry of such applicants concerning
the applicants' insurance and investment objectives, financial situations and
needs, and the likelihood that the applicants will continue to make the premiun
payments contemplated by the Certificates under the Contracts.

5. PROMOTIONAL MATERIALS

Company shall have the responsibility for furnishing to Distributor and its
representatives sales promotion materials and individual sales proposals
relating to the sale of the Contracts and Certificates. Distributor shall not
use any such materials that have not been approved by Company. Distributor shall
be responsible for obtaining NASD review of all promotional materials.

6. COMPENSATION

Company shall arrange for the payment of commissions directly to those
representatives of Distributor who are entitled thereto in connection with the
sale of the Contacts on behalf of Distributor, in the amounts and on such terms
and conditions as Company and Distributor shall determine; provided that such
terms, conditions and commissions shall be as are set forth in or as are not
inconsistent with the Prospectus included as part of the Registration Statement
for the Contracts and effective under the Securities Act.

Company shall arrange for the payment of commissions directly to those
Brokers who sell Contracts and Certificates under agreements entered into
pursuant to paragraph 2 hereof, in amounts as may be agreed to by the Company
and specified in such written agreements between Distributor and Brokers.

Company shall reimburse Distributor for the costs and expenses incurred by
Distributor in furnishing or obtaining the services, materials, and supplies
required by the terms of this Agreement in the initial sales efforts and the
continuing obligations hereunder. Reimbursement shall be a portion of
Distributor's yearly expenses based on Company's share of relevant activity. In
addition, Company shall pay Distributor a surcharge of one (1) to three (3)
percent of the commissions Company pays to Brokers and to representatives of
Distributor.

7. RECORDS

Distributor shall have the responsibility for maintaining the records of
its representatives that are licensed, registered and otherwise qualified to
sell the Contracts and the underlying Certificates. Distributor shall maintain
such other records as are required of it by applicable laws and regulations. The
books, accounts, and records of the Company, the Account and Distributor shall
be maintained so as to disclose clearly and accurately the nature and details of
the transactions. Copies of all records maintained by the Distributor in
connection with this Agreement shall be made available to and become the
property of the Company upon its request. The Distributor shall keep
confidential any information obtained pursuant to this Agreement and shall
disclose such information only if the Company has authorized such disclosure, or
if such disclosure is expressly required by applicable federal or state
regulatory authorities.

II-11
<PAGE>

8. INVESTIGATION AND PROCEEDING

Distributor and Company agree to cooperate fully in any insurance
regulatory investigation or proceeding or judicial proceeding arising in
connection with the Contracts and Certificates distributed under this Agreement.
Distributor and Company further agree to cooperate fully in any securities
regulatory investigation or proceeding with respect to Company, Distributor,
their affiliates and their representatives to the extent that such investigation
or proceeding is in connection with the Contracts and Certificates distributed
under this Agreement. The Distributor shall furnish applicable federal and state
regulatory authorities with any information or reports in connection with its
services under this Agreement which such authorities may request to ascertain
whether the Company's operations are being conducted in a manner consistent with
any applicable law or regulation.

In the case of a substantive customer complaint, Distributor and Company
will cooperate in investigating such complaint and any response to such
complaint will be sent to the other party to this Agreement for approval not
less than five business days before being sent to the customer or regulatory
authority, except that if a more prompt response is required, the proposed
response shall be communicated by telephone or telegraph.

9. TERMINATION

This Agreement shall terminate automatically upon its assignment within the
meaning of such term in the Investment Company Act. This Agreement, however, may
be transferred by the Distributor without the prior written consent of the
Company in the circumstances set forth in Rule 2a-6 under the Investment Company
Act. The Agreement may be terminated at any time by either party on 60 days
written notice to the other party, without the payment of any penalty. Upon
termination of this Agreement all authorizations, rights and obligations shall
cease except the obligation to settle accounts hereunder, including commissions
on premiums subsequently received for Contracts in effect at a time of
termination, and the agreements contained in paragraph 8 hereof.

10. REGULATION

This Agreement shall be subject to the provisions of the Investment Company
Act and the Exchange Act and of the rules, regulations, and rulings thereunder
and the applicable rules and regulations of the NASD, from time to time in
effect, and the terms hereof shall be interpreted and construed in accordance
therewith.

11. Severability

If any provisions of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby.

II-12
<PAGE>

12. WARRANTIES

Each party to this Agreement warrants to the other party as follows:

(a) it has full power and authority to execute and deliver this
Agreement and to perform and observe the provisions herein;

(b) the execution, delivery, and performance of this Agreement have
been duly authorized by all necessary corporate actions and do not and will
not contravene any requirement of law or any contractual restrictions or
agreement binding on or affecting such party or its assets; and

(c) this Agreement has been duly and properly executed and delivered
by such party and constitutes a legal, valid, and binding obligation of
such party enforceable in accordance with its terms.

13. APPLICABLE LAW

This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of New Jersey.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By:
-----------------------------------------
Name: Anne E. Bossi
Title: President, Group Life Insurance

PRUDENTIAL INVESTMENT MANAGEMENT SERVICES LLC

By:
-------------------------------------------
Name: E. Michael Caulfield
Title: President

II-13

EXHIBIT 1.A(5)(a)
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

GROUP INSURANCE CONTRACT

CONTRACT HOLDER: [PRUDENTIAL GROUP LIFE INSURANCE TRUST]

GROUP CONTRACT NO.: [GV-XXXXX]

Prudential will provide or pay the benefits described in the Group Insurance
Certificate(s) listed in the Schedule of Plans of the Group Contract, subject to
the Group Contract's terms. This promise is based on the Contract Holder's
application and payment of the required premiums.

All of the provisions of the Group Insurance Certificate(s), attached to and
made a part of the Group Contract, apply to the Group Contract as if fully set
forth in the Group Contract.

The Group Contract takes effect on the Contract Date, if it is duly attested
under the Group Contract Schedule. It continues as long as the required premiums
are paid, unless it ends as described in its General Rules.

The Group Contract is delivered in and is governed by the laws of the Governing
Jurisdiction.

[Secretary Chairman]

II-14

<PAGE>

GROUP CONTRACT SCHEDULE

CONTRACT DATE: [January 1, 19XX]

CONTRACT ANNIVERSARIES: [January 1 of each year, beginning in 19XX]

PREMIUM DUE DATES: [The Contract Date, and the first day of the month beginning
with February, 19XX]

Governing Jurisdiction: [State of Delaware]

[MINIMUM AGGREGATE FACE AMOUNT OF INSURANCE UNDER THE GROUP CONTRACT: $XXX,XXX

MINIMUM NUMBER OF CERTIFICATES IN FORCE UNDER THE GROUP CONTRACT: 25]

[INCLUDED EMPLOYERS

Each employer listed below has met the Rules for Inclusion and is an Included
Employer under the Group Contract as of the Inclusion Date shown below.

For the purpose of the Group Contract, an Employee will be considered an
Employee of only one subsidiary or affiliate of an Included Employer. That
Employee's service with any other subsidiary or affiliate of an Included
Employer will be treated as service with that one.

RULES FOR INCLUSION: The employer must:

(1) make a written request to Prudential to be included under the Group
Contract; and

(2) agree in writing to make required payments to the Contract Holder for the
insurance; and

(3) be approved by Prudential for inclusion under the Group Contract.

INCLUSION DATE: The date on which Prudential approves the Employer for
inclusion. But, if Prudential approves the Employer for inclusion before the
Contract Date, it is the Contract Date.]

II-15
<PAGE>

LIST OF INCLUDED EMPLOYERS

INCLUDED EMPLOYER INCLUSION DATE ANNIVERSARY DATE

[The A.B.C. Company January 1, 19XX January 1 of each year,
and these subsidiaries beginning in 19XX
or affiliates:
The U.V.W. Company
The X.Y.Z. Company

The D.E.F. Company January 1, 19XX January 1 of each year,
beginning in 19XX

The G.H.I. Company January 1, 19XX January 1 of each year,
beginning in 19XX]

--------------------

TABLE OF CONTENTS [(AS OF CONTRACT DATE): The Group Contract includes these
forms with an 89759 prefix: COV 10XX, GCS 10XX, SPR 10XX, GR 10XX, SCH 10XX, APP
10XX].

--------------------

Attest: ____________________________

II-16

<PAGE>

SCHEDULE OF PREMIUM RATES [#1]

[GV-XXXXX]

CLASSES OF [EMPLOYEES] TO WHICH THIS SCHEDULE APPLIES:

[All Employees of The A.B.C. Company]

[MONTHLY RATE PER EMPLOYEE]

[APPLICABLE COVERAGE EMPLOYEE INSURANCE DEPENDENTS INSURANCE
<S> <C> <C>
VARIABLE UNIVERSAL LIFE xxx% of the 1980 xxx% of the 1980
COVERAGE Commissioners Standard Commissioners Standard
Ordinary Mortality Table Ordinary Mortality Table
(Male - Age Last Birthday) (Male - Age Last Birthday)
per $1,000 of Face Amount per $1,000 of Face Amount
of Insurance by Attained of Insurance by Attained
Age* Age*
Additional Provisions for
Accidental Death and
Dismemberment Coverage $X.XX per $1,000 of $X.XX per $1,000 of
insurance insurance
Additional Provisions for
Motor Vehicle Accident Death
Coverage $Y.YY per $1,000 of $Y.YY per $1,000 of
insurance insurance
Additional Provisions for
Dependents Term Life Coverage $Z.ZZ

</TABLE>

*In no event will the monthly rate be higher than 150% of the applicable amount
under the 1980 Commissioners Standard Ordinary Mortality Table (Male - Age Last
Birthday).

With respect to Premium Rate Changes for the Classes of Employees shown above,
Prudential will not make the changes permitted on a Premium Due Date for the
Variable Universal Life Coverage and any of the additional provisions that may
be a part of the Variable Universal Life Coverage before the end of the 12-month
period following the Included Employer's Inclusion Date.]

II-17
<PAGE>

GENERAL RULES

A. PAYMENT OF PREMIUMS - GRACE PERIOD.

Premiums are to be paid by the Contract Holder to Prudential. Each may be paid
at [the Prudential Office listed below] or to one of its authorized agents. For
each Included Employer, the first premium is due and payable on that Included
Employer's Inclusion Date. Subsequent premiums are due on each Premium Due Date
stated in the Group Contract Schedule. For each Included Employer, the Contract
Holder may pay each premium, other than the first, within [61] days of the
Premium Due Date without being charged interest. Those days are known as the
grace period. The Contract Holder is liable to pay premiums to Prudential for
each Included Employer for the time the Group Contract is in force for that
Included Employer.

[All notices and payments to Prudential under this Group Contract will be
deemed received when they are received at the following address:

The Prudential Insurance Company of America
56 Livingston Ave.
Roseland, New Jersey 07068]

B. PREMIUM AMOUNTS.

The premium due for an Included Employer on that Included Employer's Inclusion
Date is the sum of the contribution amounts made by the Included Employer's
Employees for Covered Persons under the Insurance. Those amounts are determined
from the premium rates then in effect, contributions permitted under the
Insurance and the [Employees] then insured. [If an employer becomes an Included
Employer on a date other than a Premium Due Date of the Group Contract, the
premium amounts will be pro rated for the number of days from the Inclusion Date
to the next Premium Due Date.]

C. CHANGES IN PREMIUM RATE, CHARGES AND INVESTMENT OPTIONS.

The premium rates, which include the Cost of Insurance [for the Variable
Universal Life Coverage and any of the additional provisions that may be a part
of the Variable Universal Life Coverage] in effect on an Included Employer's
Inclusion Date are shown in the Group Contract. The mortality and expense risk
charges and the Schedule of Charges and Expenses in effect on an Included
Employer's Inclusion Date, and the investment options available to an Included
Employer's Employees, are shown in the Certificate applicable to the Covered
Classes. Prudential has the right to make the following changes:

(1) Prudential may change the premium rates, which include the Cost of
Insurance [for the Variable Universal Life Coverage and any of the
additional provisions that may be a part of the Variable Universal Life
Coverage,] the mortality and expense risk charges and the Schedule of
Charges and Expenses, as of the following dates:

(a) any Premium Due Date; and

(b) any date that an employer becomes or ceases to be an Included
Employer; and

II-18

<PAGE>

(c) any date that the extent or nature of the risk under the Group
Contract is changed: (i) by amendment; or (ii) by reason of any
provision of law or any governmental program or regulation[; or (iii)
upon the determination, by Prudential, that the number of Certificates
in force with respect to an Included Employer at the beginning of a
month varies (positively or negatively) from the number of
Certificates in force with respect to that Included Employer as of the
beginning of the previous month by more than 10% or (iv) upon the
determination, by Prudential, that the aggregate Face Amount of
Insurance in force with respect to an Included Employer at the
beginning of a month varies (positively or negatively) from the
aggregate Face Amount of Insurance in force with respect to that
Included Employer as of the beginning of the previous month by more
than 10%.]

Unless an Included Employer's Schedule of Premium Rates or an amendment to
the Group Contract applicable to an Included Employer states otherwise,
Prudential will not make the changes permitted on a Premium Due Date before
the end of the 12-month period following the Included Employer's Inclusion
Date.

(2) Prudential may change any of the limits that apply to charges. These
changes may apply to contributions to investment options made both before
and after the change takes effect. With respect to each Included Employer,
the changes must be at least 90 days apart. Before Prudential makes any of
these changes, it will give the Included Employer at least 90 days advance
notice.

The variable investment options to which an Employee may make contribution
allocations is limited to the variable investment options chosen by that
Employee's Included Employer. The variable investment options which may be
chosen by an Included Employer include only those made available to the Included
Employer by Prudential. [An Included Employer may choose no more than 20
variable investment options and, once chosen, may not make any substitutions.
Selection of and changes to an Included Employer's variable investment options
may only be made in a manner and at times acceptable to Prudential.]

D. DIVIDENDS.

Prudential will determine the share, if any, of its divisible surplus allocable
to this Group Contract [with respect to each Included Employer] as of the
anniversary of each [Included Employer's Inclusion Date], if the Group Contract
stays in force by the payment of all required premiums to that date. The share
will be credited to this Group Contract as a dividend as of that date. If [an
Employer ceases to be an Included Employer] on a date other than [an anniversary
of that Included Employer's Inclusion Date,] the share, if any, will be
determined and credited to this Group Contract as of that date.

Each dividend will be paid to the Contract Holder in cash, unless the Contract
Holder asks that it be applied toward the premium then due.

Prudential's sole liability as to any dividend is as set forth above.

NON-PROFIT CLAUSE: This applies if the aggregate dividends under this Group
Contract and any other group contract(s) of the Contract Holder exceed the
aggregate payments toward their cost made from the [Included Employer's] own
funds. The Contract Holder will see that an amount equal to the excess is
applied for the benefit of insured persons.

II-19

<PAGE>

E. END OF THE GROUP CONTRACT OR OF AN INSURANCE FOR AN INCLUDED EMPLOYER.

DURING OR AT END OF GRACE PERIOD - FAILURE TO PAY EMPLOYER PAYMENT: If any
Employer payment required by the Contract Holder with respect to any premium due
for that Included Employer is not paid by the end of its grace period, this
Group Contract will end with respect to that Included Employer [when that period
ends.] But, the Included Employer may write to the Contract Holder, at least [90
days] in advance, to ask that the Group Contract be ended for that Included
Employer at the end of a period of time for which premiums have been paid. Then
this Group Contract for that Included Employer will end on the date requested.

[ON A PREMIUM DUE DATE - FAILURE TO MAINTAIN INSURING CONDITIONS: On any Premium
Due Date, Prudential may end the Group Contract if: (a) the number of
Certificates in force under the Group Contract falls below the minimum set forth
in the Group Contract Schedule; or (b) the aggregate Face Amount of Insurance
under the Group Contract falls below the minimum set forth in the Group Contract
Schedule. To do so, Prudential must give the Contract Holder and each Included
Employer notice at least 90 days in advance.]

[CEASING TO BE AN INCLUDED EMPLOYER: An employer may cease to be an Included
Employer because the Included Employer no longer meets the rules for inclusion
or for any other reason. Prudential may end an Included Employer's participation
in the Group Contract: (a) upon its determination that the number of
Certificates in force under the Group Contract with respect to that Included
Employer falls below 25; or (b) upon its determination that the aggregate Face
Amount of Insurance in force with respect to an Included Employer falls below
$X,XXX,XXX.XX. If this happens, the Group Contract will end for Employees of
that Included Employer at the end of the period for which premiums have been
paid with respect to Employees of that Included Employer. But the Group Contract
may permit coverage for such Employees to be continued subject to certain
rules.]

[ON A CONTRACT ANNIVERSARY: Prudential may end the Group Contract on any
Contract Anniversary. But notice of its intent to do so must be given to the
Contract Holder and to each Included Employer at least 31 days in advance.]

F. [EMPLOYEE'S] CERTIFICATE.

Prudential will give [each Included Employer] individual certificate(s) [to be
given to each insured Employee]. The certificate will describe the extent of the
[Employee's Insurance and Dependents Insurance] under this Group Contract. It
will include (1) to whom Prudential pays benefits, (2) any protection and rights
when insurance ends, and (3) claim rights and requirements.

G. RECORDS - INFORMATION TO BE FURNISHED.

[The Contract Holder, each Included Employer] or Prudential, as they agree, will
keep a record of the [Employees] covered under the insurance. It will contain
the key facts about their insurance.

At the times set by Prudential, [the Contract Holder or each Included Employer]
will send the data required by Prudential to perform its duties under the Group
Contract, and to determine the premium rates [and charges due.] All records of
[the Contract Holder and each Included Employer] which bear on the insurance
must be open to Prudential for its inspection at any reasonable time.

II-20

<PAGE>

Prudential will not have to perform any duty that depends on such data before it
is received in a form that satisfies Prudential. [The Contract Holder or the
Included Employer] may correct wrong data given to Prudential, if Prudential has
not been harmed by acting on it. A person's insurance will not be made invalid
by failure of [the Contract Holder or the Included Employer], due to clerical
error, to record or report the person for that insurance.

H. THE CONTRACT - INCONTESTABILITY OF THE CONTRACT.

The entire Group Contract consists of: (1) the forms shown in the Table of
Contents as of the Contract Date; (2) the Group Insurance Certificate(s) listed
in the Schedule of Plans, a copy of which is attached to the Group Contract; (3)
all modifications and endorsements to such Group Insurance Certificates which
are attached to and made a part of the Group Contract by amendment to the Group
Contract; (4) the [Contract Holder's] application, a copy of which is attached
to the Group Contract; (5) any amendments or endorsements to the Group Contract;
and (6) the individual applications, if any, of the persons insured. No
statement of the Contract Holder will be used in any contest of the insurance
under the Group Contract.

There will be no contest of the validity of the Group Contract, except for not
paying premiums, after it has been in force for one year.

The Group Contract may be amended, at any time, without the consent of the
insured [Employees] or of anyone else with a beneficial interest in it. This can
be done through a written request made by the Contract Holder and agreed to by
Prudential. But an amendment will not affect a claim incurred before the date of
change.

Only an officer of Prudential has authority: to waive any conditions or
restrictions of the Group Contract; or to extend the time in which charges may
be paid; or to make or change a contract; or to bind Prudential by a promise or
representation; or by information given or received. A Prudential agent is not
an officer.

No change in this Group Contract is valid unless shown in:

(1) an endorsement on it signed by an officer of Prudential; or

(2) an amendment to it signed by the Contract Holder and by an officer of
Prudential.

[But if the Group Contract is changed automatically as provided in Section I,
the change may be made in an amendment to the Group Contract that is signed only
by an officer of Prudential.]

[I. CONFORMITY WITH LAW.

To receive tax treatment accorded to life insurance under federal law, the
Insurance must meet the definition of life insurance as provided in the Internal
Revenue Code or successor law. To make sure the Insurance qualifies, Prudential
reserves the right: (a) to refuse contributions which would cause the Group
Contract to fail to definition of life insurance; and (b) to make changes in the
Group Contract or to make distributions from the Certificate Funds to
[Employees] to the extent needed to continue to qualify as life insurance.

If the provisions of the Group Contract do not conform to the requirements of
any state or federal law or regulation that applies to it, the Group Contract is
automatically changed to conform to the requirements of that law or regulation.]

--------------------

II-21

<PAGE>

SCHEDULE OF PLANS [#1]

EFFECTIVE: [January 1, 19XX]

GROUP CONTRACT NO.: [GV-XXXXX]

This Schedule of Plans sets forth the Plan of Benefits that applies to each
Covered Class of an Included Employer under the Group Contract listed below as
of the Effective Date. The Plan of Benefits for a Covered Class is determined
by: (1) the Group Insurance Certificates that apply to the Covered Class; and
(2) any modification to those Certificates, provided the modification is listed
below or included in an amendment to the Group Contract. A copy of the
Certificate applicable to each Covered Class, and any modification to it, are
attached to the Group Contract and are made a part of it.

[1.] COVERED CLASS:

[All Employees of The A.B.C. Company]

PLAN OF BENEFITS THAT APPLIES TO THIS CLASS:

[The Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage,
described in the Group Insurance Certificate:

(a) Prepared for Group Contract No. GV-XXXXX;

(b) With the Program Date of January 1, 19XX; and

[2. COVERED CLASS:

All Employees of The D.E.F. Company

PLAN OF BENEFITS THAT APPLIES TO THIS CLASS:

The Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage,
described in the Group Insurance Certificate:

(a) Prepared for Group Contract No. GV-XXXXX;

(b) With the Program Date of January 1, 19XX; and

--------------------

II-22

<PAGE>

MODIFICATION OF THE GROUP CONTRACT

[The Group Contract is modified to provide that:

With respect to the A.B.C. Company, the provisions titled CEASING TO BE AN
INCLUDED EMPLOYER appearing in Section E of the General Rules, is replaced by
the following:

CEASING TO BE AN INCLUDED EMPLOYER: An employer may cease to be an Included
Employer because the Included Employer no longer meets the rules for inclusion
or for any other reason. Prudential may end an Included Employer's participation
in the Group Contract: (a) upon its determination that the number of
Certificates in force under the Group Contract with respect to that Included
Employer falls below 30; or (b) upon its determination that the aggregate Face
Amount of Insurance in force with respect to an Included Employer falls below
$5,000,000. If this happens, the Group Contract will end for Employees of that
Included Employer at the end of the period for which premiums have been paid
with respect to Employees of that Included Employer. But the Group Contract may
permit coverage for such Employees to be continued subject to certain rules.]

II-23

<PAGE>

COMBINATION OF EXPERIENCE

Group Contract [GV-XXXXX, and Group Policy No. G-XXX
(Called "Group Contracts" below)]

[Eligible Class: All Employees of The A.B.C. Company.]

[With respect to The A.B.C. Company,] the Group Contracts [will be] treated as
one, [GT-XXXXX], for this purpose: to determine the share, if any, of
Prudential's divisible surplus allocable to the Group Contracts.

[Under that one, the financial experience of the coverage of this group will be
considered separately from that of all others:

All Employees of The A.B.C. Company classified as Hourly Employees.]

--------------------

II-24

<PAGE>

APPLICATION TO

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA (PRUDENTIAL)

FOR GROUP CONTRACT NO. [GV-XXXXX]

APPLICANT: [PRUDENTIAL GROUP LIFE INSURANCE TRUST]

ADDRESS: [Wilmington, DE]

The Group Contract is approved and its terms are accepted.

This Application is made in duplicate. One is attached to the Group Contract.
The other is to be returned to Prudential.

It is agreed that this Application replaces any prior Application for the Group
Contract.

[PRUDENTIAL GROUP LIFE INSURANCE TRUST]
--------------------------------------------
(Full or Corporate Name of Applicant)

Dated at [Wilmington, DE] By [John Doe, President]
----------------- ----------------------------------------
(Signature and Title)

On [January 1, 19 XX] Witness [Richard Roe]
----------------------- ----------------------------------
(To be signed by Resident Agent
where required by law)

[This copy is to be returned to Prudential.]

II-25

<PAGE>

AMENDMENT TO GROUP CONTRACT NO. [GV-XXXXX]

[EFFECTIVE DATE: June 1, 19XX]

[By their signatures below, the] Contract Holder and Prudential agree that the
Group Contract is changed as follows:

[1. The List of Included Employers in the Group Contract Schedule is replaced
by this list:

List of Included Employers

INCLUDED EMPLOYER INCLUSION DATE

The A.B.C. Company January 1, 19XX
and these subsidiaries
or affiliates:
The U.V.W. Company
The X.Y.Z. Company

The G.H.I. Company January 1, 19XX

The J.K.L. Company June 1, 19XX

2. Form 89759 SCH 1001 (Schedule of Plans) is attached to this Amendment. It
forms part of the Group Contract as of its Effective Date. The form
replaces, as of its Effective Date, form 89759 SCH 1001 (Schedule of Plans)
with an Effective Date of January 1, 19XX.]

[June 1, 19XX PRUDENTIAL GROUP LIFE INSURANCE TRUST]
- ---------------------------- --------------------------------------------
(Full or Corporate Name of Contract Holder)

[Witness Richard Roe] By [John Doe, President]
------------------- -----------------------------------------
(Signature and Title)

[Roseland, NJ June 1, 19XX] THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
- ----------------------------

[Attest: Mary Poe By
-------------------- ----------------------------------------
Assistant Secretary]

II-26

EXHIBIT 1.A(5)(b)
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

GROUP INSURANCE CERTIFICATE

PRUDENTIAL certifies that insurance is provided according to [the Group
Contract] for [each insured Employee. Your Schedule of Benefits shows the
Contract Holder, the Included Employer and the Group Contract Number.]

[INSURED EMPLOYEE: You are eligible to become insured under the Group Contract
if:

(1) you are in the Covered Classes of the Certificate's Schedule of Benefits;
and

(2) you meet the requirements in the Certificate's Who Is Eligible section.

The When You Become Insured section of the Certificate states how and when you
may become insured for the Variable Universal Life Coverage, including any of
the additional provisions that may be a part of the Variable Universal Life
Coverage. Your insurance will end when the rules in the When Your Insurance Ends
section so provide.]

[BENEFICIARY FOR EMPLOYEE DEATH BENEFITS: See the Certificate's Beneficiary
Rules.]

VARIABLE UNIVERSAL LIFE COVERAGE

[COVERAGE AND AMOUNTS: The Variable Universal Life Coverage, including any of
the additional provisions that may be a part of the Variable Universal Life
Coverage, and the amounts of insurance are described in the Certificate.]

[If you are insured, this Group Insurance Certificate replaces any older
certificates issued to you for the Variable Universal Life Coverage, including
any of the additional provisions that may be a part of the Variable Universal
Life Coverage.] All benefits are subject in every way to the entire Group
Contract which includes the Group Insurance Certificate.

RIGHT TO EXAMINE THIS CERTIFICATE: You may return this Certificate to
Prudential, for any reason, within 10 days after you receive it. If you return
it within this period, the Insurance will be void from its Effective Date, and
we will refund your contributions.

THE DEATH BENEFIT MAY INCREASE OR DECREASE DAILY DEPENDING ON THE PAYMENT OF
PREMIUMS, THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT AND THE LEVEL OF
MORTALITY CHARGES MADE. BUT, IT WILL NOT BE LESS THAN THE FACE AMOUNT OF
INSURANCE SHOWN PLUS THE AMOUNT OF ANY EXTRA BENEFIT, IF THE COVERED PERSON'S
INSURANCE IS NOT IN DEFAULT AND THERE IS NO CERTIFICATE FUND DEBT OR WITHDRAWAL.

THE CERTIFICATE FUND VALUE MAY INCREASE OR DECREASE DAILY DEPENDING ON THE
PAYMENT OF PREMIUMS, THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT AND THE
LEVEL OF MORTALITY CHARGES MADE. THERE IS NO GUARANTEED MINIMUM.

II-27

<PAGE>

[SPECIFICATIONS PAGE
(Made a part of the Certificate as of January 1, 19XX)

CONTRACT HOLDER: The ABC Bank as Trustee for the Prudential Group Life
Insurance Trust

INCLUDED EMPLOYER: The A.B.C. Company GROUP CONTRACT NO.: 12345

PREMIUM DUE DATE: The first day of each month after January 1, 19XX

CONTRACT ANNIVERSARY: January 1 of each year, beginning in 19XX

EFFECTIVE DATE OF CERTIFICATE: January 1, 19XX

EMPLOYEE: John A. Doe CERTIFICATE NO.: xxx-xx-xxxx-x

DEPENDENTS COVERAGE APPLIES: Yes

COVERED DEPENDENT SPOUSE: Mary K. Doe

DEPENDENT CHILD(REN) COVERED: Yes

BENEFICIARY FOR EMPLOYEE DEATH BENEFITS: Mary K. Doe, Wife

BENEFICIARY FOR DEPENDENT SPOUSE DEATH BENEFITS: Richard A. Doe, Child

VARIABLE UNIVERSAL LIFE COVERAGE:

FACE AMOUNT OF INSURANCE:

EMPLOYEE: $XX,XXX.XX

DEPENDENT SPOUSE: $XX,XXX.XX

INITIAL MONTHLY CONTRIBUTION:

EMPLOYEE: $XX.XX

DEPENDENT SPOUSE: $XX.XX

ALLOCATION OF CONTRIBUTION AMOUNTS:

EMPLOYEE INSURANCE --

Option Percentage
------ ----------
The Prudential Series Fund, Inc.:
Money Market 50%
Stock Index 20%

Janus Aspen Series:
Growth 10%

Warburg Pincus Trust:
Post-Venture Capital 20%

II-28

<PAGE>

DEPENDENT SPOUSE INSURANCE --

Option Percentage
------ ----------
The Prudential Series Fund, Inc.:
Money Market 50%
Stock Index 20%

Janus Aspen Series:
Growth 10%

Warburg Pincus Trust:
Post-Venture Capital 20%

ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND DISMEMBERMENT COVERAGE APPLY: Yes

EMPLOYEE AMOUNT OF INSURANCE: $XX,XXX.XX

DEPENDENT SPOUSE AMOUNT OF INSURANCE: $XX,XXX.XX

ADDITIONAL PROVISIONS FOR ACCIDENTAL MOTOR VEHICLE DEATH COVERAGE - SEAT BELT
BENEFIT APPLY: Yes

EMPLOYEE AMOUNT OF INSURANCE: $XX,XXX.XX

DEPENDENT SPOUSE AMOUNT OF INSURANCE: $XX,XXX.XX

ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE COVERAGE APPLY: Yes

DEPENDENT CHILD AMOUNT OF INSURANCE: $XX,XXX.XX

SCHEDULE OF CHARGES AND EXPENSES

EXPENSE CHARGES: From each contribution paid by you, Prudential deducts the
sum of:

(1) An amount equal to X.X% of the contribution to cover state and local
premium taxes; and

(2) an amount equal to X.X% of the contribution to cover applicable federal
taxes; and

(3) a sales charge equal to X.X% of the contribution, and such charge will not
exceed X.X% of the contribution.

From the balance, Prudential deducts a per-payment processing charge of $X.XX.
Prudential may change this charge, but it will not exceed $X.XX.

The charges described in (1) and (2) above may be changed if the cost of
Prudential's taxes related to premium change. You will be notified about the
amount of any change in the above Expense Charges.

MONTHLY ADMINISTRATION CHARGE: The monthly administration charge will be $X.XX.
Prudential may change this charge, but it will not exceed $X.XX.

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

THIS SPECIFICATIONS PAGE REPLACES, AS OF JULY 1, 19XX, ANY PRIOR SPECIFICATIONS
PAGE ISSUED TO YOU WITH RESPECT TO THE COVERAGE DESCRIBED IN THE CERTIFICATE.]

II-29

<PAGE>

TABLE OF CONTENTS

[SCHEDULE OF BENEFITS.......................................................00

COVERED CLASSES.........................................................00
PROGRAM DATE............................................................00
YOU SHOULD KNOW.........................................................00

VARIABLE UNIVERSAL LIFE COVERAGE........................................00

OPTION TO ACCELERATE PAYMENT OF CERTAIN DEATH BENEFITS
UNDER VARIABLE UNIVERSAL LIFE COVERAGE............................00

ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND
DISMEMBERMENT COVERAGE............................................00
ADDITIONAL PROVISIONS FOR ACCIDENTAL MOTOR VEHICLE
DEATH COVERAGE....................................................00
ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE COVERAGE.............00

OTHER INFORMATION.......................................................00

TABLE OF CORRIDOR PERCENTAGES...............................................00

TABLE OF MAXIMUM RATES......................................................00

WHO IS ELIGIBLE TO BECOME INSURED...........................................00

WHEN YOU BECOME INSURED.....................................................00

DELAY OF EFFECTIVE DATE.....................................................00

VARIABLE UNIVERSAL LIFE COVERAGE............................................00

OPTION TO ACCELERATE PAYMENT OF CERTAIN DEATH BENEFITS

UNDER VARIABLE UNIVERSAL LIFE COVERAGE................................00

ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND DISMEMBERMENT
COVERAGE.............................................................00

ADDITIONAL PROVISIONS FOR ACCIDENTAL MOTOR VEHICLE DEATH COVERAGE.......00

ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE COVERAGE.................00

GENERAL INFORMATION.........................................................00

BENEFICIARY RULES; MODE OF SETTLEMENT RULES; INCONTESTABILITY
OF INSURANCE..........................................................00

LIMITS ON ASSIGNMENTS; EFFECT OF GIFT ASSIGNMENT OF RIGHTS OF GROUP
VARIABLE UNIVERSAL LIFE INSURANCE UNDER ANOTHER GROUP CONTRACT;
AGE ADJUSTMENT; DEFINITIONS...........................................00

CLAIM RULES.............................................................00

WHEN INSURANCE ENDS.........................................................00]

II-30
<PAGE>

SCHEDULE OF BENEFITS

[COVERED CLASSES: All Employees of the A.B.C. Company.

PROGRAM DATE: January 1, 19XX. This Certificate describes the benefits under the
Group Program as of the Program Date.

YOU SHOULD KNOW...

O The Variable Universal Life Coverage in this Certificate, including any of
the additional provisions that may be a part of the Variable Universal Life
Coverage, is available to you if you are included in the Covered Classes.
Only that Coverage and those additional provisions for which you become
insured will apply to you. The rules for becoming insured are in this
Certificate's When You Become Insured section.

O There is a Delay of Effective Date section. The rules of that section may
delay the start of your insurance.

O The Delay of Effective Date section also applies to any change, including a
change in class, unless otherwise stated.

O The Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage, is
described more fully on later pages of this Certificate. Be sure to read
those pages carefully. They show when benefits are or are not payable under
the Group Contract. They also outline when insurance ends and the
conditions, limitations and exclusions that apply to the Coverage.

O A Definitions section is included in this Certificate. Many of the terms
used in this Certificate are defined in that section.

O ThisCertificate provides life insurance with flexible premium payments
after the first two years.

O Cashvalues may increase or decrease, based on performance of the variable
investment options. No guarantee applies to the cash values, except those
to the Fixed Account.

O The Variable Universal Life Coverage in this Certificate, including any of
the additional provisions that may be a part of the Variable Universal Life
Coverage, is insured under a Group Contract issued by Prudential. All
benefits are subject in every way to the entire Group Contract which
includes the Group Insurance Certificate. It alone forms the agreement
under which payment of insurance is made.

VARIABLE UNIVERSAL LIFE COVERAGE

FOR YOU AND YOUR DEPENDENT SPOUSE

FACE AMOUNTS OF INSURANCE:

II-31

<PAGE>

AMOUNT FOR EACH BENEFIT CLASS:
<TABLE>
<CAPTION>

BENEFIT CLASSES FACE AMOUNT OF INSURANCE
<S> <C>

All Employees who are enrolled for
Option I, as reported to Prudential
by the Included Employer An amount equal to the lesser of (1) and (2):

(1) 100% of your annual Earnings, but not less than $10,000.

(2) $XXX,XXX.

All Employees who are enrolled for
Option II, as reported to Prudential
by the Employer An amount equal to the lesser of (1) and (2):

(1) 200% of your annual Earnings, but not less than $10,000.

(2) $XXX,XXX.

</TABLE>

The Definitions explains what "Earnings" means.

If you are enrolled for either Option I or Option II above, you may have your
Face Amount of Insurance determined instead under the other option. Your Face
Amount of Insurance will be determined under such other option when the
following requirements are met.

(1) You have requested through the Included Employer such other plan on a form
approved by Prudential.

(2) If the plan you request would result in your becoming insured for a higher
Face Amount of Insurance than that for which your are currently enrolled:

(a)You must give evidence of insurability to Prudential.

(b)Prudential must decide the evidence is satisfactory.

(c)You must meet the Active Work Requirement.

NON-MEDICAL LIMITS ON FACE AMOUNT OF INSURANCE: There are limits on the amount
for which you may be insured without submitting evidence of insurability. These
are called the Non-medical Limits. Non-medical Limit A: $XXX,XXX.

If the Face Amount of Insurance for your Class and age at any time is more
than the Non-medical Limit A, you must give evidence of insurability
satisfactory to Prudential before the part over the Limit can become
effective. This requirement applies: when you first become insured; when
your Class changes; or if the Face Amount of Insurance for your Class is
changed by an amendment to the Group Contract. Even if you are insured for
an amount over the Limit, you will still have to meet this evidence
requirement before any increase in your Face Amount of Insurance can become
effective.

Non-medical Limit B: $XX,XXX.

II-32

<PAGE>

Your Face Amount of Insurance under the Variable Universal Life Coverage
may increase if your Earnings increase. If, at any time, such an increase
in your Earnings causes your Face Amount of Insurance to increase by more
than the Non-medical Limit B, you must give evidence of insurability
satisfactory to Prudential before any part of that increase can become
effective.

If the Amount Limitation for the Variable Universal Life Coverage applies at any
time to your amount of insurance, that Limitation will also apply to the
Non-medical Limit as if it were an amount of insurance.

Your Face Amount of Insurance will be increased to the amount for your Class and
age when Prudential decides the evidence is satisfactory and you meet the Active
Work Requirement.

The Delay of Effective Date section does not apply to this provision.

AMOUNT LIMITATION: On the first day of the month coinciding with or next
following your attainment of the Limiting Age (shown below) or more, your Face
Amount of Insurance is limited. It is the greater of: (a) five times your
Certificate Fund on the Business Day coinciding with or next following your
attainment of the Limiting Age; and (b) $25,000. But, in no event will your Face
Amount of Insurance exceed the amount of your Face Amount of Insurance on the
day prior to the Limiting Age.

Limiting Age: The later of: (a) age 70; (b) the tenth anniversary of the day on
which you became insured for the Variable Universal Life Coverage under the
Group Contract; and (c) your age on the first day on which you are retired by
the Included Employer.

EFFECT OF OPTION TO ACCELERATE DEATH BENEFITS UNDER VARIABLE UNIVERSAL LIFE
Coverage: When you elect this option, the total amount of Variable Universal
Life Coverage otherwise payable on a person's death, including any amount under
an extended death benefit, will be reduced by the Terminal Illness Proceeds and
the Accelerated Payment Fee. Also, any amount a person could otherwise have
converted to an individual contract will be reduced by the Terminal Illness
Proceeds and the Accelerated Payment Fee.

CHANGE DATE: January 1 of each year.

BURIAL EXPENSES: If it appears to Prudential that a person incurs expenses in
connection with your burial, that person may receive part of your insurance
under the Variable Universal Life Coverage. Prudential, at its option, may pay
that person up to $250.00. If an amount is so paid, Prudential will not have to
pay that part of your insurance again.

INITIAL MONTHLY CONTRIBUTION -- $XX.XX

MINIMUM LUMP SUM CONTRIBUTION -- $XXX.XX

ASSIGNMENTS: All assignments are allowed.

ON YOUR QUALIFIED DEPENDENT SPOUSE UNDER DEPENDENTS INSURANCE

A Face Amount of Insurance equal to the Option shown below, elected by the
Employee, as reported to Prudential by the Included Employer:

OPTION FACE AMOUNT OF INSURANCE
All Employees who are enrolled for
Spouse Option I An amount equal to the lesser of (1) and (2):

II-33

<PAGE>

(1) 100% of your annual Earnings, but not
less than $10,000.

(2) $XXX,XXX.

All Employees who are enrolled for
Spouse Option II An amount equal to the lesser of (1) and (2):

(1) 200% of your annual Earnings, but not
less than $10,000.

(2) $XXX,XXX.

The Definitions explains what "Earnings" means.

If you are enrolled for either Spouse Option I or Spouse Option II above, you
may have the Face Amount of Insurance for your spouse determined, instead, under
the other spouse option. The Face Amount of Insurance for your spouse will be
determined under such other option when the following requirements are met.

(1) You have requested through the Included Employer such other plan on a form
approved by Prudential.

(2) If the plan you request would result in your spouse becoming insured for a
higher Face Amount of Insurance than that for which your spouse is
currently enrolled:

(a) You must give evidence of insurability for your spouse to Prudential.

(b) Prudential must decide the evidence is satisfactory.

NON-MEDICAL LIMITS ON YOUR FACE AMOUNT OF INSURANCE FOR YOUR SPOUSE: There are
limits on the amount for which you may be insured with respect to your spouse
without submitting evidence of insurability. These are called the Non-medical
Limits.

Non-medical Limit A: $XXX,XXX.

If the Face Amount of Insurance for your spouse for your Class and your
spouse's age at any time is more than the Non-medical Limit A, you must
give evidence of insurability for your spouse satisfactory to Prudential
before the part over the Limit can become effective. This requirement
applies: when you first become insured with respect to your spouse; when
your Class changes; or if the Face Amount of Insurance for your spouse for
your Class is changed by an amendment to the Group Contract. Even if you
are insured with respect to your spouse for an amount over the Limit, you
will still have to meet this evidence requirement with respect to your
spouse before any increase in your spouse's Face Amount of Insurance can
become effective.

Non-medical Limit B: $XX,XXX.

Your Face Amount of Insurance for your spouse under the Variable Universal
Life Coverage may increase if your Earnings increase. If, at any time, such
an increase in your Earnings causes your Face Amount of Insurance for your
spouse to increase by more than the Non-

II-34

<PAGE>

medical Limit B, you must give evidence of insurability with respect to
your spouse satisfactory to Prudential before any part of that increase can
become effective.

If the Amount Limitation for the Variable Universal Life Coverage applies at any
time to your amount of insurance for your spouse, that Limitation will also
apply to the Non-medical Limit as if it were an amount of insurance.

The Face Amount of Insurance will be increased for your spouse to the amount for
your Class and your spouse's age when Prudential decides the evidence is
satisfactory and your spouse is not confined for medical care or treatment at
home or elsewhere.

The Delay of Effective Date section does not apply to this provision.

AMOUNT LIMITATION: On the first day of the month coinciding with or next
following your spouse's attainment of the Limiting Age (shown below) or more,
your Face Amount of Insurance for your spouse is limited. It is the greater of:
(a) five times your Certificate Fund for your spouse on the Business Day
coinciding with or next following your spouse's attainment of the Limiting Age;
and (b) $25,000. But, in no event will your Face Amount of Insurance for your
spouse exceed the amount of your spouse's death benefit on the day prior to the
Limiting Age.

Limiting Age: The later of: (a) age 70; and (b) the tenth anniversary of the day
on which you became insured with respect to your spouse for the Variable
Universal Life Coverage under the Group Contract.

INITIAL MONTHLY CONTRIBUTION -- $XX.XX

MINIMUM LUMP SUM CONTRIBUTION -- $XXX.XX

EFFECT OF OPTION TO ACCELERATE DEATH BENEFITS UNDER VARIABLE UNIVERSAL LIFE
COVERAGE: When you elect this option, the total amount of Variable Universal
Life Coverage otherwise payable on a person's death, including any amount under
an extended death benefit, will be reduced by the Terminal Illness Proceeds and
the Accelerated Payment Fee. Also, any amount a person could otherwise have
converted to an individual contract will be reduced by the Terminal Illness
Proceeds and the Accelerated Payment Fee.

ASSIGNMENTS: All assignments are allowed.

LIST OF INVESTMENT OPTIONS --

Fund
Option Portfolio Valuation Date
- ------ --------- --------------
Prudential Series Fund, Inc. Money Market The Valuation Date
Diversified Bond for all portfolios is
Flexible Managed the end of each
Stock Index Business Day
Equity Income
Equity
Prudential Jennison
Global

Janus Aspen Series Growth

T. Rowe Price International International Stock
Series, Inc.

II-35

<PAGE>

TCI Portfolios, Inc. TCI Value

Warburg Pincus Trust Post-Venture Capital

Fixed Account

ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND DISMEMBERMENT COVERAGE

FOR YOU AND YOUR DEPENDENT SPOUSE

AMOUNT OF INSURANCE: An amount equal to the Face Amount of Insurance for which
the Covered Person is insured under the Variable Universal Life Coverage as
determined above. For this purpose only, that amount will be the amount, as
determined above, except that if the Covered Person's Variable Universal Life
Coverage is reduced by any amount paid under the Option to Accelerate Payment of
Certain Death Benefits Under Variable Universal Life Coverage, that reduction
will not apply to these provisions.

ASSIGNMENTS: All assignments are allowed.

ADDITIONAL PROVISIONS FOR ACCIDENTAL MOTOR VEHICLE DEATH COVERAGE

FOR YOU AND YOUR DEPENDENT SPOUSE

AMOUNT OF INSURANCE: An amount equal to the lesser of: (a) $10,000; and (b) 10%
of the person's Face Amount of Insurance under the Variable Universal Life
Coverage as determined above. For this purpose only, "Face Amount of Insurance"
will be the amount, as determined above, except that if the Covered Person's
Variable Universal Life Coverage is reduced by any amount paid under the Option
to Accelerate Payment of Certain Death Benefits Under Variable Universal Life
Coverage, that reduction will not apply to these provisions.

But, if proper use of a seat belt is not certified in the accident report,
$1,000.

ASSIGNMENTS: All assignments are allowed.

ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE COVERAGE

FOR YOUR DEPENDENT CHILDREN

AMOUNT OF INSURANCE: Your children, according to age, as follows:

AGE AMOUNT OF INSURANCE

14 days of over but less than 6 months $ 100.00
6 months or over 1,000.00

ASSIGNMENTS: All assignments are allowed.

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<PAGE>

OTHER INFORMATION

CONTRACT HOLDER: Prudential Group Life Insurance Trust

GROUP CONTRACT NO.: G-XXXXX

INCLUDED EMPLOYER: The A.B.C. Company

ANNIVERSARY OF INCLUDED EMPLOYER'S INCLUSION DATE: January 1 of each year,
beginning in 19XX.

EMPLOYMENT WAITING PERIOD: The following period of continuous full-time service
with the Employer: 30 days.

COST OF INSURANCE: The Coverage describes the minimum premium contributions
required, as well as the additional premium contributions you may make. You will
be given additional information concerning the cost of the coverage when you are
asked to enroll. The minimum charge to provide the Variable Universal Life
Coverage, other than any additional provisions that may be a part of the
Variable Universal Life Coverage, will never exceed the applicable amount under
the Table of Maximum Rates.

PRUDENTIAL'S ADDRESS:

The Prudential Insurance Company of America
56 North Livingston Avenue
Roseland, New Jersey 07068

--------------------

WHEN YOU HAVE A CLAIM

Each time a claim is made, it should be made without delay. Use a claim form and
follow the instructions on the form. If you do not have a claim form, contact
your Employer or Prudential.]

--------------------

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<PAGE>

TABLE OF CORRIDOR PERCENTAGES

(FOR DETERMINING A PERSON'S INSURANCE AMOUNT)

PERSON'S PERSON'S
ATTAINED AGE PERCENT ATTAINED AGE PERCENT

0 to 40 250% 70 115%
41 243% 71 113%
42 236% 72 111%
43 229% 73 109%
44 222% 74 107%
45 215% 75 105%
46 209% 76 105%
47 203% 77 105%
48 197% 78 105%
49 191% 79 105%
50 185% 80 105%
51 178% 81 105%
52 171% 82 105%
53 164% 83 105%
54 157% 84 105%
55 150% 85 105%
56 146% 86 105%
57 142% 87 105%
58 138% 88 105%
59 134% 89 105%
60 130% 90 105%
61 128% 91 104%
62 126% 92 103%
63 124% 93 102%
64 122% 94 101%
65 120% 95 100%
66 119% 96 100%
67 118% 97 100%
68 117% 98 100%
69 116% 99 100%

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<PAGE>

Table of Maximum Rates

GUARANTEED MAXIMUM MONTHLY COST OF INSURANCE (COI) PER $1,000 OF NET AMOUNT AT
RISK BY ATTAINED AGE

[150% of 1980 Commissioners Standard Ordinary - Male - Age Last Birthday

Attained Age COI/1,000 Attained Age COI/1,000 Attained Age COI/1,000

0 $0.329 34 $0.257 67 $3.974
1 $0.129 35 $0.272 68 $4.332
2 $0.123 36 $0.290 69 $4.726
3 $0.121 37 $0.311 70 $5.171
4 $0.116 38 $0.336 71 $5.678
5 $0.110 39 $0.363 72 $6.261
6 $0.104 40 $0.394 73 $6.917
7 $0.098 41 $0.428 74 $7.638
8 $0.094 42 $0.464 75 $8.407
9 $0.092 43 $0.504 76 $9.213
10 $0.094 44 $0.546 77 $10.047
11 $0.101 45 $0.592 78 $10.915
12 $0.115 46 $0.640 79 $11.845
13 $0.134 47 $0.691 80 $12.867
14 $0.155 48 $0.747 81 $14.011
15 $0.177 49 $0.807 82 $15.302
16 $0.199 50 $0.875 83 $16.731
17 $0.216 51 $0.954 84 $18.265
18 $0.227 52 $1.042 85 $19.872
19 $0.235 53 $1.142 86 $21.526
20 $0.238 54 $1.252 87 $23.217
21 $0.238 55 $1.370 88 $24.941
22 $0.234 56 $1.497 89 $26.712
23 $0.230 57 $1.630 90 $28.553
24 $0.224 58 $1.772 91 $30.513
25 $0.219 59 $1.928 92 $32.678
26 $0.215 60 $2.101 93 $35.266
27 $0.213 61 $2.295 94 $38.747
28 $0.213 62 $2.514 95 $43.983
29 $0.215 63 $2.761 96 $52.624
30 $0.219 64 $3.033 97 $67.625
31 $0.226 65 $3.327 98 $83.333
32 $0.234 66 $3.641 99 $83.333]
33 $0.244

II-39

<PAGE>

WHO IS ELIGIBLE TO BECOME [INSURED]

[FOR EMPLOYEE INSURANCE

YOU ARE ELIGIBLE FOR EMPLOYEE INSURANCE WHILE ALL OF THESE CONDITIONS ARE MET:

o You are a full-time Employee of the Included Employer; and

o You are less than age 75; and

o You are in a Covered Class; and

o You have completed the Employment Waiting Period.

YOU ARE FULL-TIME if you are regularly working for the Included Employer at
least the number of hours in the Included Employer's normal full-time work week
for your class, but not less than 30 hours per week. If you are a partner or
proprietor of the Included Employer, that work must be in the conduct of the
Included Employer's business.

YOUR CLASS is determined by the Included Employer. This will be done under its
rules, on dates it sets. The Included Employer may not discriminate among
persons in like situations. You cannot belong to more than one class for
insurance under the Variable Universal Life Coverage, including any of the
additional provisions that may be a part of the Variable Universal Life
Coverage. "Class" means Covered Class, Benefit Class or anything related to
work, such as position or Earnings, which affects the insurance available.

THIS APPLIES IF YOU ARE AN EMPLOYEE OF MORE THAN ONE SUBSIDIARY OR AFFILIATE OF
AN INCLUDED EMPLOYER UNDER THE GROUP CONTRACT: For the insurance, you will be
considered an Employee of only one of those subsidiaries or affiliates. Your
service with the others will be treated as service with that one.

The rules for obtaining Employee Insurance are in the When You Become Insured
section.]

[FOR DEPENDENTS INSURANCE

You are eligible for Dependents Insurance while:

o You are eligible for Employee Insurance; and

o You have a Qualified Dependent.

QUALIFIED DEPENDENTS FOR THE ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE
COVERAGE:

o Your unmarried children 14 days old but less than 19 years old. But, the
age 19 limit does not apply to a child who:

(a) wholly depends on you for support and maintenance;

(b) is enrolled as a full-time student in a school; and

Student Age Limit: 23.

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<PAGE>

Your children include your legally adopted children and each of your
stepchildren and foster children who depends on you for support and maintenance.

QUALIFIED DEPENDENTS FOR THE VARIABLE UNIVERSAL LIFE COVERAGE, THE OPTION TO
ACCELERATE PAYMENT OF CERTAIN DEATH BENEFITS UNDER VARIABLE UNIVERSAL LIFE
COVERAGE AND THE ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND DISMEMBERMENT
COVERAGE AND FOR ACCIDENTAL MOTOR VEHICLE DEATH COVERAGE:

o Your spouse who is less than age 75.

EXCEPTION: Your spouse or child is not a Qualified Dependent while:

(1) on active duty in the armed forces of any country; or

(2) insured for Employee Insurance under the Group Contract.

A CHILD WILL NOT BE CONSIDERED THE QUALIFIED DEPENDENT OF MORE THAN ONE
EMPLOYEE. If this would otherwise be the case, the child will be considered the
Qualified Dependent of the Employee named in a written agreement of all such
Employees filed with the Included Employer. If there is no written agreement,
the child will be considered the Qualified Dependent of:

(1) the Employee who became insured under the Group Contract with respect to
the child, while the child was a Qualified Dependent of only that Employee;
and otherwise

(2) the Employee who has the longest continuous service with the Included
Employer, based on the Included Employer's records.

The rules for obtaining Dependents Insurance are in the When You Become Insured
Section.]

When You Become [Insured]

[FOR EMPLOYEE INSURANCE

Your Employee Insurance will begin on the first day of the month which coincides
with or next follows the date on which you meet all of these requirements:

o You are eligible for Employee Insurance; and

o You are in a Covered Class for that insurance; and

o You have met any evidence requirement for the Employee Insurance; and

o Your insurance is not being delayed under the Delay of Effective Date
Section below; and

o That Coverage is part of the Group Contract; and

o You have enrolled on a form approved by Prudential and agreed to pay the
required contributions.

At any time, the benefits for which you are insured are those for your class,
unless otherwise stated.

II-41

<PAGE>

WHEN EVIDENCE IS REQUIRED: In any of these situations, you must give evidence of
insurability. This requirement will be met when Prudential decides the evidence
is satisfactory.

(1) You enroll more than 31 days after you could first be covered.

(2) You enroll after any of your insurance under the Group Contract ends
because you did not pay a required contribution.

(3) You wish to become insured for life insurance and have an individual life
insurance contract which you obtained by converting your insurance under
the Variable Universal Life Coverage of the Group Contract.

(4) You apply to reinstate your Variable Universal Life Coverage, including any
of the additional provisions that may be a part of the Variable Universal
Life Coverage.

(5) You have not met a previous evidence requirement to become insured under
any Prudential group contract covering Employees of the Included Employer.

FOR DEPENDENTS INSURANCE

Your Dependents Insurance for a person will begin on the first day of the month
which coincides with or next follows the date on which the person is a Qualified
Dependent and you meet all of these requirements:

o The person is your Qualified Dependent.

o You are in a Covered Class for that insurance.

o You have met any evidence requirement for that Qualified Dependent.

o Yourinsurance for that Qualified Dependent is not being delayed under the
Delay of Effective Date Section.

o Dependents Insurance under that Coverage is part of the Group Contract.

o You have enrolled on a form approved by Prudential and agreed to pay the
required contributions.

At any time, the Dependents Insurance benefits for which you are insured are
those for your class, unless otherwise stated.

WHEN EVIDENCE IS REQUIRED: In any of these situations, you must give evidence of
insurability for a Qualified Dependent. For each Qualified Dependent, this
requirement will be met when Prudential decides the evidence is satisfactory.

(1) You enroll for Dependents Insurance under the Variable Universal Life
Coverage, including any of the additional provisions that may be a part of
the Variable Universal Life Coverage, more than 31 days after you are first
eligible for Dependents Insurance. The requirement will apply to each
Qualified Dependent you have when you enroll.

(2) You enroll for Dependents Insurance after any insurance under the Group
Contract ends because you did not pay a required contribution. The evidence
requirement will apply to each Qualified Dependent you have when you
enroll.

(3) You apply to reinstate the Variable Universal Life Coverage, including any
of the additional provisions that may be a part of the Variable Universal
Life Coverage, for your Qualified Dependents.

II-42

<PAGE>

(4) The Qualified Dependent is a person for whom a previous requirement for
evidence of insurability has not been met. The evidence was required for
that person to become covered for an insurance, as a dependent or an
Employee. That insurance is or was under any Prudential group contract for
Employees of the Included Employer.

While you are insured for Dependents Insurance under the Variable Universal Life
Coverage, including any of the additional provisions that may be a part of the
Variable Universal Life Coverage, the evidence requirement will not apply to a
new dependent.]

[DELAY OF EFFECTIVE DATE

FOR EMPLOYEE INSURANCE

Your Employee Insurance under the Variable Universal Life Coverage, including
any of the additional provisions that may be a part of the Variable Universal
Life Coverage, will be delayed if you do not meet the Active Work Requirement on
the day your insurance would otherwise begin. Instead, it will begin on the day
you meet the Active Work Requirement and other requirements for the insurance.
The same delay rule will apply to any change in your insurance that is subject
to this section if you do not meet the Active Work Requirement on the day on
which that change would take effect.

FOR DEPENDENTS INSURANCE

If a Qualified Dependent is confined for medical care or treatment, at home or
elsewhere, on the day your Dependents Insurance under the Variable Universal
Life Coverage, including any of the additional provisions that may be a part of
the Variable Universal Life Coverage, for that Qualified Dependent or any change
in that insurance that is subject to this section, would take effect, it will
not take effect until the Qualified Dependent's final medical release from such
confinement. The other requirements for the insurance or change must also be
met.

Newborn Child Exception for the Additional Provisions for Dependents Term Life
Coverage: This section does not apply to a child of yours if the child is born
to you, becomes your Qualified Dependent when the child is 14 days old, and
either:

(1) is your first Qualified Dependent; or

(2) becomes a Qualified Dependent while you are insured for Dependents
Insurance under the Additional Provisions for Dependents Term Life Coverage
for any other Qualified Dependent.

Also, this section does not apply to any age increase in the amount of insurance
for a child under the Additional Provisions for Dependents Term Life Coverage.]

--------------------

II-43

<PAGE>

VARIABLE UNIVERSAL LIFE COVERAGE

FOR [EMPLOYEES AND THEIR DEPENDENTS]

This Coverage is life insurance which includes one or more of these three parts:
Face Amount of Insurance, a Certificate Fund and paid-up insurance. To be a
Covered Person under this Coverage a person must first have become insured for
the Face Amount of Insurance. Under certain conditions, the Certificate Fund may
be applied to provide paid-up insurance. Paid-up insurance continues until death
unless surrendered [or voided when Extension of Coverage and Waiver of Cost of
Insurance Charges During Total Disability applies].

A. DEATH BENEFIT.

If a person dies:

(a) while a Covered Person under this Coverage; or

[(b) while protected under the Extended Death Protection During Total Disability
Section of this Coverage; or]

[(c)] during the conversion period after the person's Insurance under this
Coverage ends;

a death benefit is payable when Prudential receives written proof of death.
Unless the Insurance is in default, the amount of the death benefit on any date
is the Insurance Amount less any Certificate Debt. The Insurance Amount is [ the
greater of:

(1) the Face Amount of Insurance plus Certificate Fund; or

(2) the Certificate Fund times the percent for the person's attained age in the
Table of Corridor Percentages.]

The Face Amount of Insurance is shown in the [Specifications Page.] The amount
of death benefit will depend on the contributions made by or for the Covered
Person, the investment experience of the Separate Account (described in Section
D. of the Coverage), any interest credited to the Fixed Account (described in
Section E. of the Coverage) and the level of charges made. When a death benefit
is payable, the value of the Certificate Fund is determined as of the date of
death. When the Insurance has ended, the amount of the death benefit payable
includes any amount available under the provisions of [Sections K. and M.] of
this Coverage.

B. CONTRIBUTIONS.

[The contribution for the first month that this Coverage is in force for a
Covered Person must be at least equal to the Initial Monthly Contribution
applicable to that person. After that, you may change the frequency and amount
of the monthly contribution, so long as the amount in the person's Certificate
Fund, less any Certificate Debt, is enough to make the monthly deductions from
the Certificate Fund. Section C. describes charges for the cost of insurance and
other monthly deductions from the Certificate Fund.]

You may also make lump sum contributions for the Covered Person at any time. But
Prudential reserves the right to not accept a lump sum contribution less than
the Minimum Lump Sum

II-44

<PAGE>

Contribution. After the Expense Charges are deducted from each contribution, the
balance goes into the Covered Person's Certificate Fund. The balance is the Net
Contribution. The [Initial] Monthly Contribution, Minimum Lump Sum Contribution
and the Expense Charges are shown in the [Specifications Page.]

Prudential reserves the right not to accept, or to return, contributions which
would cause this Coverage to fail to qualify as life insurance under applicable
tax laws, or which would increase the Insurance Amount by more than it increases
the Certificate Fund.

DEFAULT: On the first day of each Contract Month Prudential will determine if a
Covered Person's Insurance is in default. To do so, Prudential will determine
the value of the Covered Person's Certificate Fund as of the previous Business
Day and deduct from that amount the charges described under Section C. of the
Coverage. If the resulting amount, less any Certificate Debt, is less than the
amount needed to make the monthly deduction from the Certificate Fund, the
Covered Person's Insurance is in default.

The Covered Person's Insurance is also in default if there is excess Certificate
Debt, as described under Section J. of the Coverage[, or if any specified
Monthly Contribution are not paid for the Covered Person when due, as provided
under Section B. of the Coverage.]

GRACE PERIOD: You will be granted a grace period equal to the greater of: (a) 61
days from the date the Insurance goes into default; or (b) 30 days from the date
Prudential mails you a notice of default, to make the minimum premium
contribution required to keep the Covered Person's Insurance in force.
Prudential will continue to accept contributions and make the charges it has set
during the grace period. If the Covered Person dies within the grace period, the
death benefit payable will be reduced by the amount that would have been
required to keep the Covered Person's Insurance in force to the end of the month
in which death occurs. If the minimum contribution is not made by the end of the
grace period, the Covered Person's Insurance will end without value.

[REINSTATEMENT: If a Covered Person's Insurance is still in default after the
grace period ends, it may be reinstated. To do so, these conditions must be met:

(1) You must request reinstatement within three years from the end of the Grace
Period.

(2) The Insurance must not have been surrendered for its Cash Surrender Value.

(3) You have given evidence of the Covered Person's insurability that satisfies
Prudential.

(4) The Cash Surrender Value must not have been used to buy paid-up insurance .

(5) You must pay a contribution at least equal to: (a) the amount, if any,
needed to bring the Covered Person's Certificate Fund up to zero as of the
date the Covered Person's Insurance went into default; plus (b) the
deductions from the Certificate Fund during the grace period following the
date of default; plus (c) an amount sufficient to make two months'
deductions from the Certificate Fund. From this amount, the Expense Charges
shown in the Specifications Page, plus any other charges, will be deducted.

(6) The Group Contract has not ended.

If Prudential approves, the reinstatement will be effective on the first day of
the month coinciding with or following the date on which the contribution
described in (5) is paid.]

II-45

<PAGE>

C. THE CERTIFICATE FUND.

ALLOCATIONS: For the first [20] days following the Effective Date of the
Certificate, the Net Contributions, if any, for a Covered Person are allocated
to [the Money Market Account.] Thereafter, you may allocate all or part of the
Net Contributions for the Covered Person to one or more of the variable
investment options of the Separate Account shown in the List of Investment
Options or to the Fixed Account. Any allocation made by the [Employee] for the
Covered Person must be at least [5%] of each Net Contribution and a fractional
percent may not be chosen. The total must be 100%. You may change the Covered
Person's allocation for future Net Contributions at any time while this Coverage
is in force. You must notify Prudential on a form acceptable to it. The change
will take effect at the end of the Business Day on which Prudential receives the
notice, provided such notice is received in good order.

On the date on which a person becomes a Covered Person for this Coverage, the
Certificate Fund is equal to the Net Contributions credited on that date, less
any applicable charges in items (10)[, (11) and (12)] below. On any other date,
the Certificate Fund is equal to what it was on the prior Business Day plus
these items:

(1) any Net Contribution credited on that day;

(2) any increase due to investment results in the value of the variable
investment options;

(3) guaranteed interest at an effective rate of [4%] a year on that part of the
Certificate Fund that is in the Fixed Account;

(4) any excess interest on that part of the Certificate Fund that is in the
Fixed Account; and

(5) interest credited to any Loan Account as described in Section J. of the
Coverage. and less these items applicable as of that date:

(6) any decrease due to investments results in the value of the variable
investment options;

(7) a charge against the variable investment options at a rate of [.00123%] a
day ([0.45%] a year) for mortality and expense risk. Prudential may change
that charge, but not to exceed .00245 % a day (0.90% a year);

(8) A charge against the variable investment options for investment management
fees and expenses;

(9) any amount charged against the variable investment options for local, state
or federal taxes;

(10) a charge for the cost of insurance;

[(11)any charges for administration;

(12) charges for any additional insurance benefits;]

[(13)] any partial withdrawals;

[(14)any transaction charges that may result from a partial withdrawal, loan,
additional statement request or transfer;]

[(15)] the amount of any interest on a loan that is not paid when due as
described in Section J. of the Coverage.

II-46

<PAGE>

GUARANTEED INTEREST: Prudential will credit interest each day on that part of
the Certificate Fund invested in the Fixed Account. The interest credited will
be [.01074598 % a day (4% a year)].

EXCESS INTEREST: Prudential may credit interest in addition to the guaranteed
interest on that part of the Certificate Fund that is allocated to the Fixed
Account. The rate of any excess interest will be determined from time to time.
Prudential may credit a different rate of excess interest to different parts of
the Certificate Fund allocated to the Fixed Account.

CHARGE FOR COST OF INSURANCE: On the first day of each Contract Month,
Prudential will deduct a charge for the cost of Insurance from the Certificate
Fund. [This charge may also include the cost associated with additional
provisions that may be part of the Variable Universal Life Coverage.] The amount
deducted is computed as the applicable monthly rate times the Net Amount at
Risk. The Net Amount at Risk is equal to the Insurance Amount less the
Certificate Fund. The monthly rate is based on the Covered Person's age, rate
class and other features of the Coverage. In no event will the monthly rate be
higher than [150% of the applicable amount under the 1980 Commissioners Standard
Ordinary Mortality Table (Male, age last birthday).]

CHARGE FOR ADMINISTRATION: On the first day of each Contract Month, Prudential
may deduct a charge for administration. The amount of this charge, if any, is
shown in the Specifications Page under Monthly Administration Charge.

DEDUCTION OF CHARGES: Any charges deducted from the Covered Person's Certificate
Fund will be charged against the Fixed Account and against the variable
investment options of the Separate Account on a proportional basis.

D. SEPARATE ACCOUNT.

This Coverage provides that certain values and payments will vary to reflect the
investment results of the Separate Account.

SEPARATE ACCOUNT: The words "Separate Account" where they are used without
qualification, mean The Prudential Variable Contract Account - GI-2 (VCA-GI-2).
Prudential established VCA - GI-2 to support group contracts, such as this one,
which participate in the Separate Account.

Prudential owns the assets of the Separate Account; it keeps them separate from
the assets of its general account. Assets held in the Separate Account shall not
be chargeable with liabilities arising out of any other business of Prudential.
For this purpose, "assets" means only those amounts held in the Separate Account
needed to satisfy Prudential's obligation pertaining to benefits attributable to
the Separate Account. Assets held in each investment option of VCA-GI-2 shall
not be chargeable with liabilities arising in connection with any other
investment option of VCA-GI-2.

Prudential will keep assets in the Separate Account with a total market value at
least equal to the amount of the liabilities relating to the benefits
attributable to the Separate Account. Prudential will have sole control of the
amount, if any, by which such value exceeds those liabilities. Prudential may,
from time to time, transfer cash among the Separate Account, its other
investment accounts and the investment options of VCA-GI-2 as, in its judgement,
experience warrants. No such transfer will affect Prudential's liability under
this Group Contract.

VARIABLE INVESTMENT OPTIONS: The VCA-GI-2 variable investment options available
to you are listed in the List of Investment Options. You allocate, using
percentages, the Net Contributions for the Covered Person among the various
options.

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<PAGE>

THE FUNDS: The word Funds, where it is used without qualification, means [the
portfolios of The Prudential Series Fund, Inc. and the other mutual fund
portfolios in which the Separate Account invests. These other mutual fund
portfolios are unaffiliated with Prudential. Each of The Prudential Series Fund,
Inc. portfolios and the unaffiliated mutual fund portfolios are registered with
the SEC under the Investment Company Act of 1940 as open-end diversified
management investment companies. Each of The Prudential Series Fund, Inc.
portfolios and the unaffiliated mutual fund portfolios correspond to each of the
options in VCA-GI-2. The portfolios available to you are listed in the List of
Investment Options.]

SEPARATE ACCOUNT INVESTMENTS: Prudential uses assets of VCA-GI-2 to buy shares
in the Funds. Each option of VCA-GI-2 is invested in a corresponding portfolio
of a Fund. Income and realized and unrealized gains and losses from assets in
each of these options are credited to, or charged against, that option. This is
without regard to income, gains or losses in Prudential's other investment
accounts.

Prudential will determine the value of the assets in each option of VCA-GI-2 on
the Valuation Date for that option, as shown in the List of Investment Options.
If that date is not a Business Day, Prudential will use the value of the assets
as of the end of the last prior Business Day on which trading took place.

CHANGE IN INVESTMENT POLICY: A portfolio of the Funds might make a material
change in its investment policy. In that case, Prudential will send you a notice
of the change. Within 61 days after receipt of the notice, or within 61 days
after the effective date of the change, if later, you may transfer any amount
from that portfolio to the Covered Person's Fixed Account or any other
investment option available to you.

CHANGE OF FUND: A portfolio of the Funds might, in Prudential's judgment, become
unsuitable for investment. This might happen because of a change in investment
policy, a change in laws or regulations, because the shares are no longer
available for investment, or at the discretion of Prudential. If that occurs,
Prudential has the right to substitute another portfolio of the Funds or of an
entirely different mutual fund. But Prudential would first seek any required
regulator's consent.

E. FIXED ACCOUNT.

THE FIXED ACCOUNT: You may choose to allocate all or part of the Covered
Person's Net Contribution to the Fixed Account. Allocations to the Fixed Account
become part of Prudential's General Account. Amounts allocated to the Fixed
Account are credited with interest as described in Section C. under Guaranteed
Interest and Excess Interest.

F. INVESTMENT MANAGER.

[Prudential is the investment manager with respect to the amounts held in the
Separate Accounts. Prudential may, in its sole discretion, delegate to one or
more of its direct or indirect wholly owned subsidiaries all or part of its
authority as investment manager. No such delegation will in any way affect
Prudential's liability for any acts or omissions in the management of the
Separate Accounts.]

G. TRANSFERS.

You may transfer a Covered Person's amounts among investment options of the
Separate Account available to you and into the Fixed Account [as often as twelve
times during a Certificate Year without charge], unless the Insurance is in
default. [The minimum amount that can be

II-48

<PAGE>

transferred is $100, or the entire value of the option if less. Transfer
requests in percent terms may not be a fractional percent and must be at least
5%.] To make a transfer, you must notify Prudential on a form acceptable to it.
The transfer will take effect on the Valuation Date on which Prudential receives
the notice. No transfer may be made within the first [20] days following the
Effective Date of the Certificate.

You may also transfer a Covered Person's amounts from the Fixed Account into the
variable investment options at any time during the year, subject to the
following limitations:

(1) Only [one transfer from the Fixed Account] can be made each Certificate
Year;

(2) The maximum amount that can be transferred is [the greater of $5,000 or 25%
of the amount in the Fixed Account].

[Prudential reserves the right to deduct from the Covered Person's Certificate
Fund, on a pro-rata basis, a transaction charge of up to $20.00 for each
transfer request exceeding twelve in any Certificate Year.]

DELAYED TRANSFERS: Prudential usually transfers the Covered Person's amounts on
the date it receives the [Employee's] request. But Prudential has the right to
defer making a transfer if (1) the New York Stock Exchange is closed; or (2) the
SEC requires that trading be restricted or declares an emergency; or (3) there
occurs a system failure or power outage.

H. FULL SURRENDER.

You may surrender the Covered Person's Insurance for its Cash Surrender Value at
any time. To surrender the Covered Person's Insurance, you must ask Prudential
on a form acceptable to Prudential. You may ask Prudential what the Cash
Surrender Value of the Covered Person's Certificate Fund is prior to electing to
surrender. Prudential will pay the Cash Surrender Value calculated as of the
Valuation Date on which Prudential receives your request. The proceeds will be
paid to you in a lump sum.

[The transaction charge for a full surrender may be up to the lesser of (a) $20,
or (b) 2% of the amount paid upon surrender.]

DELAYED SURRENDER: Prudential usually pays any Cash Surrender Value within 7
days of the date it receives your request. But Prudential has the right to defer
paying the portion of the proceeds that is to come from the variable investment
options if: (1) the New York Stock Exchange is closed; or (2) the SEC requires
that trading be restricted or declares an emergency; or (3) there occurs a
system failure or a power outage. Prudential also has the right to defer paying
the portion of the proceeds that is to come from the Fixed Account for up to six
months. If Prudential does so for more than 30 days, it will pay interest on
that portion at the current Fixed Account rate.

I. PARTIAL WITHDRAWALS.

You may make partial withdrawals from the Covered Person's Certificate Fund. Any
partial withdrawals are subject to all of these terms:

(1) The Covered Person's Insurance must be in force and not in default.

(2) You must ask for the partial withdrawal on a form acceptable to Prudential.

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(3) The maximum amount of any partial withdrawal is the amount that would
reduce the Covered Person's Certificate Fund (less any Certificate Debt and
any outstanding charges) to the amount needed to make [the next monthly
deductions from the Certificate Fund].

(4) The amount withdrawn must be at least [$200].

(5) The amount withdrawn will be taken from the Covered Person's Certificate
Fund accounts on a pro-rata basis, unless you select specific accounts.

[Prudential reserves the right to deduct from the amount withdrawn from the
Covered Person's Certificate Fund a transaction charge, up to the lesser of (a)
$20.00 or (b) 2% of the amount withdrawn, with respect to each partial
withdrawal.]

DELAYED WITHDRAWALS: Prudential will usually pay any partial withdrawals within
seven days of the date it receives the request. But Prudential has the right to
defer paying the portion of the proceeds that is to come from the Covered
Person's variable investment options if : (1) the New York Stock Exchange is
closed; or (2) the SEC requires that trading be restricted or declares an
emergency; or (3) there occurs a system failure or a power outage. Prudential
also has the right to defer paying the portion of the proceeds that is to come
from the Fixed Account for up to six months. If Prudential does so for more than
30 days, it will pay interest on that portion at the current Fixed Account rate.

An amount withdrawn may not be repaid except as a contribution subject to
charges.

J. LOANS.

You may make a request to borrow from a Covered Person's Certificate Fund.

LOAN REQUIREMENTS: Loans are subject to these terms:

(1) The Covered Person's Insurance must be in force and not in default.

(2) The Covered Person's Certificate Debt must not be more than the Loan Value.

(3) The amount borrowed from the Covered Person's Certificate Fund at any one
time must be at least [$200].

(4) The amount borrowed will be taken from the Covered Person's Certificate
Fund on a pro-rata basis, unless you select specific accounts.

If there is already Certificate Debt when you take out the loan, the new amount
borrowed will be added to that debt.

MAXIMUM LOAN VALUE: The maximum Loan Value (before any applicable charge) is
determined by multiplying the Certificate Fund by [90%] and subtracting any
existing loan with accrued interest, any outstanding charges and the amount
needed to make [the next monthly deductions from the Certificate Fund].

INTEREST CHARGE: Interest charged on any loan will accrue daily at an annual
rate determined each year by Prudential. Interest payments on any loan are due
on each Contract Anniversary, or when the loan or any part of it is paid back,
if that comes first. If interest is not paid when due, it will be added to the
principal amount of the loan. Then interest is charged on it, too. Prudential
will notify the [Employee 31] days before the interest on the loan becomes due.

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The loan interest rate is the annual rate Prudential sets from time to time. The
rate will never be greater than that permitted by law. It will change [only on a
Contract Anniversary.] Before the start of each Contract Year, Prudential will
determine the loan interest rate to be charged for that year.

When you take out a loan, Prudential will tell you the initial interest rate for
the loan. Prudential will notify you if the rate is to be changed.

EFFECT OF A LOAN: A Loan Account that is part of a Covered Person's Certificate
Fund will be set up when you take out a loan. The amount of the loan taken will
be credited to the Covered Person's Loan Account.

Prudential will credit interest to the Covered Person's Loan Account at the loan
interest rate for the Contract Year, less [2 %]. On each Contract Anniversary,
if there is a loan outstanding, interest credited to the Loan Account will be
allocated to the variable investment options and the Fixed Account based on your
then current Net Contribution allocations for the Covered Person.

REPAYMENT: You may pay back all or part of any Certificate Debt at any time. If
you choose to make repayment by partial withdrawal from the Covered Person's
Certificate Fund, the provisions of Section I. of the Coverage will apply.
Repayment will be allocated among the Covered Person's Fixed Account and the
variable investment options, based on your then current Net Contribution
allocations[, unless you select specific accounts.] While a loan is outstanding,
any payment should be designated as a contribution or a loan repayment. If that
designation is not made, it will be treated as a loan repayment.

Should a death benefit become payable while a loan is outstanding, or should the
Covered Person's Insurance be surrendered while a loan is outstanding, or should
the Covered Person's Insurance lapse, any proceeds otherwise payable will be
reduced to reflect the amount of the loan and any accrued interest.

EXCESS CERTIFICATE DEBT: If Certificate Debt ever becomes equal to or more than
the Certificate Fund value minus an amount equal to that needed to make [the
next month's deductions], the Insurance is in default. Prudential will send you
a notice at your last known address stating the minimum contribution that, if
paid to Prudential, will keep this coverage from ending. The Covered Person's
Insurance under this Coverage will end at the end of the grace period described
in Section B. if the minimum contribution is not made.

DELAYED LOANS: Prudential usually makes a loan within seven days of the date it
receives your request. But Prudential has the right to defer making the portion
of the loan that is to come from the Covered Person's variable investment
options if: (1) the New York Stock Exchange is closed; or (2) the SEC requires
that trading be restricted or declares an emergency; or (3) there occurs a
system failure or a power outage. Prudential also has the right to defer paying
the portion of the proceeds of a loan that is to come from the Fixed Account for
up to six months. Prudential also has the right to defer paying the portion of
the proceeds that is to come from the Fixed Account for up to six months. If
Prudential does so for more that 30 days, it will pay interest on that portion
at the Fixed Account rate.

[Prudential reserves the right to withdraw from the Covered Person's Certificate
Fund a transaction charge of up to $20.00 with respect to each loan made.]

[K. EXTENSION OF COVERAGE AND WAIVER OF COST OF INSURANCE CHARGES DURING TOTAL
DISABILITY.

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If you meet the conditions below:

(1) The Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage, will
be extended while you are Totally Disabled.

(2) From the date Prudential first receives written proof as described below,
the monthly Charge for Cost of Insurance will be waived while the Variable
Universal Life Coverage, including any of the additional provisions that
may be a part of the Variable Universal Life Coverage, is being extended.

The conditions are:

o You become Totally Disabled while you are insured for Face Amount of
Insurance under the Variable Universal Life Coverage and are not retired.

o You are less than age 60 when your Total Disability starts.

TOTAL DISABILITY: You are "Totally Disabled" when:

(1) You are not working at any job for wage or profit; and

(2) Due to Sickness, Injury or both, you are not able to perform for wage or
profit, the material and substantial duties of any job for which you are
reasonably fitted by your education, training or experience.

The extension ends one year after your Total Disability started, unless, within
that year, you give Prudential written proof that:

(1) You have met the above conditions; and

(2) You are still Totally Disabled; and

(3) Your Total Disability has continued for at least nine months.

Prudential will then further extend the Variable Universal Life Coverage,
including any of the additional provisions that may be a part of the Variable
Universal Life Coverage, for successive one year periods. The first of these
periods will start on the date Prudential receives this proof. After that first
period, you must give written proof when and as required by Prudential once each
year that your Total Disability continues.

If you or your dependent dies while the Variable Universal Life Coverage,
including any of the additional provisions that may be a part of the Variable
Universal Life Coverage, is being extended, the death benefit will include the
amount of that extension when Prudential receives written proof that:

(1) Your Total Disability continued until that person's death; and

(2) All of the above conditions have been met.

If you or your dependent spouse dies within one year after your Total Disability
started and before you give Prudential proof of Total Disability, written notice
of your or your dependent's death must be given to Prudential within one year
after the death.

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This extension ends if and when:

(1) Your Total Disability ends or you reach age 65; or

(2) You fail to furnish any required proof that your Total Disability
continues; or

(3) You fail to submit to a medical exam by Doctors named by Prudential when
and as often as Prudential requires. After two full years of this
protection, Prudential will not require an exam more than once a year.

If this extension ends after you have given the first proof of continued Total
Disability, the same rights and benefits under Sections A and M apply as if it
was Face Amount of Insurance under the Variable Universal Life Coverage which
ended at this time. But this does not apply if you become insured again for the
Face Amount of Insurance within 31 days after this extension ends.

The amount of a person's Face Amount of Insurance that may be extended is the
amount of the person's Face Amount of Insurance on the day Total Disability
began, subject to the provisions of the Schedule of Benefits. But the amount is
reduced by any amount payable under any Prudential group life insurance that
replaces the Variable Universal Life Coverage for a class of Employees.

EFFECT OF CONVERSION: An individual contract issued under Section M will be in
place of all rights under this Section F.]

[L.] PAID-UP INSURANCE.

You may elect to provide paid-up insurance for a Covered Person at any time in
lieu of the Insurance, if the Cash Surrender Value of the Covered Person's
Certificate Fund is at least $1,000. You must make the election on a form
acceptable to Prudential.

The election will take effect at the end of the first Business Day on which
Prudential receives the form.

This option will apply automatically if: (a) a Covered Person's Insurance ends
(for reasons other than default)[; or (b) extended death protection ends (and
the person does not again become covered during the next 31 days) as provided in
Section K; and (c)] the Cash Surrender Value of the Covered Person's Certificate
Fund is at least $1,000 and you do not choose any of the options available upon
termination of the person's Coverage within 61 days after Coverage ends.

The amount of paid-up insurance under this option is the amount which the
Covered Person's current Cash Surrender Value will provide when used as a net
single premium, but it may not be more than the Covered Person's death benefit.
The maximum premium will be based on the 1980 Commissioners' Standard Ordinary
Mortality Table, Male Mortality, at 4%. It will be determined by the Covered
Person's attained age.

[All of a person's] paid-up insurance may be surrendered for its cash value at
any time. The cash value will be the net single premium at the Covered Person's
attained age for the amount of Insurance, using the same basis which determined
that amount. [Partial surrenders of a person's paid-up insurance are not
permitted.] Prudential may defer a surrender for up to six months. If Prudential
does so for more than 30 days, it will pay interest on that portion at the rate
of [3%] a year. [If a Covered Person's Paid-up insurance is surrendered for its
cash value, Prudential may make a charge, up to the lesser of: (a) 2% of the
cash value of the surrender; and (b) $20.00.]

DIVIDENDS: Prudential will determine that part of the dividend, if any, derived
from the Covered Person's paid-up insurance. That part will be applied to
increase the Covered Person's paid-up

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insurance. That part will not be considered in determining the disposition or
effect of dividends under any other provisions of the Group Contract.

CHANGE IN BENEFICIARY: If you purchase paid-up insurance and you make a
Beneficiary change the Beneficiary change form must be filed with Prudential.

[M.] CONVERSION PRIVILEGE.

If a person's Face Amount of Insurance under the Variable Universal Life
Coverage ends for [the reason] stated below, the person may convert to an
individual life insurance contract. Evidence of insurability is not required.
The [reason is:

All Face Amount of Insurance that applies to you or, with respect to your
dependent spouse, to your dependent spouse under the Group Contract for
your class ends by amendment or otherwise.] But, on the date it ends[:

(1) you must have been insured for five years for that insurance (or for
that insurance and any other Prudential rider or group contract
replaced by that insurance); or

(2) with respect to your dependent spouse, you must have been insured for
that spouse for five years for that insurance (or for that insurance
and any Prudential rider or group contract replaced by that
insurance).]

Any such conversion[s are] subject to the rest of this Section [M].

AVAILABILITY: A person must apply for the individual contract and pay the first
premium by the later of:

(1) the thirty-first day after the person's Face Amount of Insurance ends; and

(2) the fifteenth day after the person has been given written notice of the
conversion privilege. But, in no event may insurance be converted to an
individual contract if the person does not apply for the individual
contract and pay the first premium prior to the ninety-second day after the
person's Face Amount of Insurance ends.

INDIVIDUAL CONTRACT RULES: The individual contract must conform to the
following:

AMOUNT: Not more than:

(1) the total amount of the person's insurance under this Variable Universal
Life Coverage (Face Amount of Insurance plus Certificate Fund) just before
the Face Amount of Insurance ends; minus

(2) the amount of the person's Certificate Fund needed to cancel any loan due;
minus

(3) the amount of the person's paid-up insurance under the Variable Universal
Life Coverage purchased by using the person's Certificate Fund just after
the Face Amount of Insurance ends.

[But, if a person converts when extended death protection ends, the amount of
that protection applies in place of the Face Amount of Insurance in (1) above.

Or, if] the Face Amount of Insurance ends because all Face Amount of Insurance
of the Group Contract for your class ends, the total amount of individual
insurance which [you or your

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dependent spouse] may get in place of all life insurance then ending for [you or
your dependent spouse] under the Group Contract will not exceed the [lesser of
the following:

(1) The] total amount of all life insurance then ending for that person under
the Group Contract reduced by the sum of: (a) the amount of that person's
Certificate Fund needed to cancel any loan due; (b) the amount of that
person's paid-up insurance; and (c) the amount of group life insurance from
any carrier for which that person is or becomes eligible within the next 45
days.

[(2) $10,000.]

DEATH DURING CONVERSION PERIOD: The amount a person had a right to convert to an
individual contract is included in the death benefit if the person dies:

(1) Within 31 days after the person's Face Amount of Insurance ends; and

(2) While the person has the right to convert the Face Amount of Insurance to
an individual contract.

It is included even if the person did not apply for conversion. [But it is
reduced by the amount of any extended death benefit protection which applies.]

FORM: Any form of a life insurance contract that:

(1) conforms to Title VII of the Civil Rights Act of 1964, as amended, having
no distinction based on sex; and

(2) is one that Prudential usually issues at the age and amount applied for.

[This does not include term insurance or a contract with disability or
supplementary benefits.]

PREMIUM: Based on Prudential's rate as it applies to the form and amount, and to
the person's class of risk (other than gender) and age at the time.

EFFECTIVE DATE: The end of the 31 day period after which the person ceases to be
insured for the Face Amount of Insurance.

[N.] GENERAL PROVISIONS.

[SUICIDE: If a Covered Person, whether sane or insane, dies because of suicide,
the death benefit under the Variable Universal Life Coverage may be limited. If
death because of suicide occurs:

(1) within two years from the date a person became a Covered Person, it is
limited to:

(a) the sum of the contributions paid, minus

(b) any loans and the interest charged to it; minus

(2) within two years from the date of any increase in that person's Face Amount
of Insurance, the part of the death benefit that would be on account of
that increase is limited to the sum of the contributions paid for that
increase.

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(3) within two years from the date the person's Variable Universal Life
Coverage is reinstated, it is limited to:

(a) the sum of the contributions paid since the date of the reinstatement;
minus

(b) any loan and the interest charged to it; minus

ANNUAL REPORT: Prudential will send you a detailed report of each Covered
Person's Certificate Fund. It will be sent within three months after the end of
each [Contract Year.] You may request a report at other times, subject to a fee
of [$20.00] for its cost.

PAYMENT OF DEATH CLAIM: If Prudential pays a death claim in a lump sum, it will
usually pay the proceeds within seven days of the date it receives written proof
of loss. But Prudential has the right to defer paying any part of the death
benefit that is to come from the variable investment options if: (1) the New
York Stock Exchange is closed; or (2) the SEC requires that trading be
restricted or declares an emergency; or (3) there occurs a system failure or a
power outage. Prudential also has the right to defer paying the portion of the
proceeds that is to come from the Fixed Account for up to six months. If
Prudential does so for more than 30 days, it will pay interest on that portion
at the current Fixed Account rate.

BENEFICIARY; MODE OF SETTLEMENT: Any death benefit under a section of this
Coverage is payable according to that section and the Beneficiary and Mode of
Settlement Rules.

--------------------

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OPTION TO ACCELERATE PAYMENT OF CERTAIN DEATH BENEFITS
UNDER VARIABLE UNIVERSAL LIFE COVERAGE

[FOR YOU AND YOUR DEPENDENT SPOUSE]

These provisions change the Variable Universal Life Coverage (called Coverage
below) to provide an option to accelerate payment of portions of [your or your
dependent spouse's] insurance.

YOU SHOULD KNOW THAT ELECTION OF THIS OPTION MAY AFFECT OTHER BENEFITS OR
ENTITLEMENTS FOR WHICH A PERSON MAY BE ELIGIBLE. IT MAY ALSO AFFECT A PERSON'S
INCOME TAX LIABILITY. READ THESE NOTES CAREFULLY:

(1) If you elect this option, the amount of Variable Universal Life Coverage
for the person is reduced by the Terminal Illness Proceeds [and the
Accelerated Payment Fee] described below.

(2) Any payment made under this option may be taxable. You are advised to seek
the help of a professional tax advisor for assistance with any questions
that you may have.

(3) If you elect this option, eligibility for Medicaid or other government
programs may be affected. You are advised to seek the help of a
professional legal advisor for assistance with any questions that you may
have.

As used here:

"Certificate Fund Amount" means the amount of a person's Certificate Fund under
the Coverage on the day Prudential receives proof that the person is Terminally
Ill.

"Face Amount" means a person's Face Amount of Insurance under the Coverage on
the day Prudential receives proof that the person is Terminally Ill.

"Terminally Ill" means having a life expectancy that is [12 months] or less.

"Terminal Illness Proceeds" mean the amount of the Variable Universal Life Death
Benefit placed under this option for a person.

TERMINAL ILLNESS PROCEEDS: The Terminal Illness Proceeds are equal to:

o a portion of a person's Face Amount or Net Amount at Risk, as determined
under (1) below; plus

o a portion of a person's Certificate Fund Amount, as determined under (2)
below[; minus

o an Accelerated Payment Fee not to exceed $350].

(1) You must elect the portion of a person's Face Amount or Net Amount at Risk
that you want to place under this option. [You may elect up to 80% of the
person's Face Amount or Net Amount at Risk, but not more than $250,000.

If the amount of a person's death benefit is being determined under
Subsection (1) of Section A of the Coverage, such portion may be reduced
if, within 12 months after the date Prudential

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receives proof that a person is Terminally Ill, an Amount Limitation would
have applied to the person's Face Amount. In that case, the portion of the
person's Face Amount placed under this option will not exceed the person's
Face Amount after applying the Limitation.]

If the amount of a person's death benefit is being determined under
Subsection (1) of Section A of the Coverage, Prudential will determine the
Accelerated Payment Factor based on your election [and any Amount
Limitation that may apply]. The Accelerated Payment Factor is equal to:

(a) the portion of a person's Face Amount that is placed under this
option; over

(b) the person's total Face Amount.

If the amount of a person's death benefit is being determined under
Subsection (2) of Section A of the Coverage, the Accelerated Payment Factor
is equal to:

(a) the portion of a person's Net Amount of Risk that is placed under this
option; over

(b) the person's total Net Amount at Risk.

(2) The portion of a person's Certificate Fund Amount that will be placed under
this option is equal to:

(a) the person's total Certificate Fund Amount times the Accelerated
Payment Factor; minus

(b) any outstanding loan balance, plus any interest due on the loan, times
the Accelerated Payment Factor.

CHANGES MADE IN THE COVERAGE: If a person is Terminally Ill while a Covered
Person under the Coverage [or while death benefit protection is being extended
for the person under the Coverage,] you may elect to have the person's Terminal
Illness Proceeds placed under this option. That election is subject to the
"Conditions" set forth below. The amount of the death benefit otherwise payable
under the Coverage is affected as described in the "Effect on Coverage" section.
Contributions are affected as described in the "Effect on Contributions"
section.

CONDITIONS: Your right to be paid under this option is subject to these terms:

(1) You may elect this option [for a person] only once during the time [the
person is] a Covered Person.

(2) You must choose this option in writing in a form that satisfies Prudential.

(3) You must furnish proof that satisfies Prudential that the person's life
expectancy is [12 months] or less, including a certification by a [Doctor].

(4) The Variable Universal Life Coverage on the person must not be assigned.

(5) Terminal Illness Proceeds will be made available to you on a voluntary
basis only. Therefore, you are not eligible for this option if:

(a) law requires using this option to meet the claims of creditors,
whether in bankruptcy or otherwise; or

(b) a government agency requires using this option in order to apply for,
get or keep a government benefit or entitlement.

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(6) Once you elect this option for a person, you may no longer:

(a) increase the person's Face Amount of Insurance under the Coverage;

(b) make a lump sum contribution to [the Certificate Fund for the person,
except for contributions required to keep the person's Coverage from
going into default;] or

(c) increase the amount of contributions to [the Certificate Fund for the
person, except to the extent an increase is needed to reflect an
increase in the mortality and expense risk charges.]

EFFECT ON COVERAGE: When you elect this option, the total amount of Variable
Universal Life Coverage otherwise payable on a person's death[, including any
amount under an extended death benefit,] will be reduced by the Terminal Illness
Proceeds [and the Accelerated Payment Fee]. Any amount deducted from the
Certificate Fund Amount as provided in (2) (b) above will be applied to reduce
the amount of any outstanding loan and and loan interest. Also, a person may not
convert the Terminal Illness Proceeds [or the Accelerated Payment Fee]to an
individual contract.

Prudential reserves the right to make a distribution from a person's Certificate
Fund Amount when benefits under this option are paid. Any such distribution will
be made only to the extent needed to continue to qualify the Variable Universal
Life Coverage as life insurance under the Internal Revenue Code.

EFFECT ON CONTRIBUTIONS: The amount of your contribution for a person will be
adjusted based on the amount of the person's Variable Universal Life Coverage
remaining in force.

METHOD OF PAYMENT: If you elect this option, Prudential will pay the Terminal
Illness Proceeds to you in one sum when it receives proof that a person is
Terminally Ill. When Prudential pays an accelerated death benefit under this
option, Prudential will send you a statement that shows the effect of the
payment on the person's amount of Coverage and on your contribution for the
person's Coverage.

--------------------

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ADDITIONAL PROVISIONS FOR ACCIDENTAL DEATH AND DISMEMBERMENT COVERAGE

[FOR YOU AND YOUR DEPENDENT SPOUSE]

Accidental Death and Dismemberment Coverage pays benefits for accidental loss of
life, sight, hand or foot. Loss of sight means total and permanent loss of
sight. Loss of hand or foot means loss by severance at or above the wrist or
ankle.

Those benefits are payable only if all of these conditions are met:

o The person sustains an accidental bodily Injury while a Covered Person.

o The loss results directly from that Injury and from no other cause.

o The person suffers the loss within [90 days] after the accident.

Not all losses are covered. See Losses Not Covered below.

BENEFIT AMOUNT PAYABLE: The amount payable depends on the type of loss as shown
in this table. [All benefits are subject to the Limitation Per Accident below.

For loss of:

Life ]
Both Hands ]
Both Feet ]
Sight of Both Eyes ] The Amount of Insurance under the
One Hand and One Foot ] Accidental Death and Dismemberment Coverage
One Hand and Sight of One Eye ]
One Foot and Sight of One Eye ]

One Hand ]
One Foot ] One-half the Amount of Insurance under the
Sight of One Eye ] Accidental Death and Dismemberment Coverage

LIMITATION PER ACCIDENT: No more than the amount of insurance on a person under
the Accidental Death and Dismemberment Coverage is payable for all losses
resulting from the person's Injuries sustained in the same accident.]

LOSSES NOT COVERED: A loss is not covered if it results from any of these:

[(1) Suicide or attempted suicide, while sane or insane.

(2)] Sickness, whether the loss results directly or indirectly from Sickness.

[(3)]Medical or surgical treatment of Sickness, whether the loss results
directly or indirectly from the treatment.

[(4)]Any infection, unless it is pyogenic and occurs through and at the time of
an accidental cut or wound.

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[(5)] War, or any act of war. "War" means declared or undeclared war and
includes resistance to armed aggression.

[(6) Operating an automobile, or any other vehicle or conveyance, while under
the influence of drugs or alcohol.

(7) Travel or other movement by means of an aircraft, or descent from or with a
moving aircraft. This (7) applies only if:

(a) the person has any duties aboard the aircraft that relate in any way
to that aircraft or to its operation, equipment, passengers, or crew;
or

(b) the person is giving or receiving training for any of those duties
aboard that aircraft.

"Aircraft" means any kind of vehicle or device designed for travel or other
movement in or beyond the earth's atmosphere.

(8) Injury arising out of, or in the course of, any work for wage or profit
(whether or not with the Employer).]

--------------------

Each benefit of the Accidental Death and Dismemberment Coverage, other than a
death benefit, is payable to you. Any death benefit provided under a section of
the Accidental Death and Dismemberment Coverage is payable according to that
section and the Beneficiary and Mode of Settlement Rules. The Claim Rules apply
to the payment of the benefits.

--------------------

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ADDITIONAL PROVISIONS FOR ACCIDENTAL MOTOR VEHICLE DEATH COVERAGE -
SEAT BELT BENEFIT

[FOR YOU AND YOUR DEPENDENT SPOUSE]

Accidental Motor Vehicle Death Coverage pays a death benefit for accidental loss
of life that occurs as a result of a Motor Vehicle Accident. That benefit is
payable only if all of these tests are met:

(1) The person sustains a bodily Injury in a Motor Vehicle accident while a
Covered Person.

(2) The person's death results directly from that Injury and from no other
cause.

(3) At the time of the Motor Vehicle accident, the person: (a) was driving or
riding in a Motor Vehicle; and (b) was wearing a seat belt in the manner
prescribed by the Motor Vehicle's manufacturer.

(4) The person dies within [90 days] after the Motor Vehicle accident.

(5) The cause of the person's death is not in Death Benefit Not Payable below.

"Motor Vehicle" means [a private automobile of pleasure car design, van,
four-wheel drive vehicle, self-propelled motor home or truck. This does not
include a vehicle used for farming, military business, racing or any other type
of competitive speed event.]

AMOUNT OF DEATH BENEFIT PAYABLE: The person's Amount of Insurance under the
Accidental Motor Vehicle Death Coverage.

DEATH BENEFIT NOT PAYABLE: The death benefit is not payable if the person dies
as a result of [any of these:

(1) Suicide, while sane or insane.

(2) Driving a Motor Vehicle while under the influence of drugs or alcohol.

(3) Riding in a Motor Vehicle being driven by another person while that person
is under the influence of drugs or alcohol.

(4) Driving or riding in a Motor Vehicle off-road.

(5) Driving or riding in a Motor Vehicle in a race.

(6) Sickness, whether the death results directly or indirectly from the
Sickness.

(7) Medical or surgical treatment of Sickness, whether the death results
directly or indirectly from the treatment.

(8) Any infection, unless it is pyogenic and occurs through and at the time of
an accidental cut or wound.

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(9) War, or any act of war. "War" means declared or undeclared war and includes
resistance to armed aggression.]

--------------------

Any death benefit provided under a section of the Accidental Motor Vehicle Death
Coverage is payable according to that section and the Beneficiary and Mode of
Settlement Rules. The Claim Rules apply to payment of benefits.

--------------------

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ADDITIONAL PROVISIONS FOR DEPENDENTS TERM LIFE COVERAGE

[FOR YOUR DEPENDENT CHILDREN ONLY]

A. DEATH BENEFIT WHILE A COVERED PERSON.

If [a dependent child] dies while a Covered Person, the amount of insurance on
[that child] under the Dependents Term Life Coverage is payable when Prudential
receives written proof of death.

B. DEATH BENEFIT DURING A CONVERSION PERIOD.

A death benefit is payable under this Section B if [a dependent child] dies:

(1) within 31 days after ceasing to be a Covered Person; and

(2) while entitled (under Section C) to a conversion of the insurance under the
Dependents Term Life Coverage to an individual contract.

The amount of the benefit is equal to the amount of Dependents Term Life
Coverage which could have been converted. It is payable even if conversion was
not applied for. It is payable when Prudential receives written proof of death.

C. CONVERSION PRIVILEGE.

This privilege applies if you cease to be insured for the Dependents Term Life
Coverage of the Group Contract with respect to [a dependent child. That child]
may have your insurance on [the child] under the Dependents Term Life Coverage,
which then ends, converted to an individual life insurance contract. Evidence of
insurability is not required. However, conversion is not available if the
insurance ends for one of these reasons:

(1) You fail to make any required contribution for insurance under the Group
Contract.

(2) All Dependents Term Life Coverage of the Group Contract for your class ends
by amendment or otherwise. This (2) does not apply if, on the date it ends,
you have been insured with respect to [the dependent child] for five years
for that insurance (or for that insurance and any Prudential rider or group
contract replaced by that insurance).

Any such conversion is subject to the rest of this Section C.

AVAILABILITY: The individual contract must be applied for and the first premium
must be paid by the later of:

(1) the thirty-first day after you cease to be insured for Dependents Term Life
Coverage with respect to [the dependent child]; and

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(2) the fifteenth day after you have been given written notice of the
conversion privilege. But, in no event may the insurance be converted to an
individual contract if it is not applied for and the first premium paid
prior to the ninety-second day after you cease to be insured for Dependents
Term Life Coverage with respect to [the dependent child].

INDIVIDUAL CONTRACT RULES: The individual contract must conform to the
following:

Amount: Not more than the amount of Dependents Term Life Coverage on [the
dependent child] ending under the Dependents Term Life Coverage. But, if it ends
because all of the Dependents Term Life Coverage of the Group Contract for your
class ends, the total amount of individual insurance which may be obtained in
place of all the Dependents Term Life Coverage on [the dependent child] then
ending under the Group Contract will not exceed the [lesser of the following:

(1) The] total amount of all your Dependents Term Life Coverage on [the
dependent child] then ending under the Group Contract reduced by the amount
of group life insurance from any carrier for which you are or become
eligible with respect to [the dependent child] within the next 31 days.

[(2) $10,000.]

Form: Any form of a life insurance contract that:

(1) conforms to Title VII of the Civil Rights Act of 1964, as amended, having
no distinction based on sex; and

(2) is one that Prudential usually issues at the age and amount applied for.

[This does not include term insurance or a contract with disability or
supplementary benefits.]

Premium: Based on Prudential's rate as it applies to the form and amount, and to
[the dependent child's] class of risk and age at the time.

Effective Date: The end of the 31-day period after you cease to be insured for
Dependents Term Life Coverage with respect to [the dependent child].

--------------------

Any death benefit provided under a section of the Dependents Term Life Coverage
is payable to you. If you are not living at the death of [a dependent child],
the death benefit is payable to [the dependent child's] estate, or, at
Prudential's option, to any one or more of these surviving relatives of [the
dependent child]: wife; husband; mother; father; children; brothers; sisters.

--------------------

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<PAGE>

GENERAL INFORMATION

BENEFICIARY RULES

The rules in this section apply to insurance payable on account of [your] death,
when the Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage, states
that they do. [These rules also apply to insurance payable on account of your
spouse's death, when the Variable Universal Life Coverage, including any of the
additional provisions that may be a part of the Variable Universal Life
Coverage, states that they do. But these rules are modified by any burial
expenses rule in the Schedule of Benefits and, if there is an assignment, by the
following Sections: Limits on Assignments; and Effect of Gift Assignment of
Rights of Group Variable Universal Life Insurance Under Another Group Contract.]

"Beneficiary" means a person chosen, on a form approved by Prudential, to
receive the insurance benefits.

You have the right to choose a Beneficiary.

If there is a Beneficiary for the [insurance], it is payable to that
Beneficiary.

Any amount of insurance for which there is no Beneficiary at [a person's] death
will be payable [to the person's estate].

You may change the Beneficiary at any time without the consent of the present
Beneficiary. The Beneficiary change form must be filed through the [Included
Employer]. The change will take effect on the date the form is signed. But it
will not apply to any amount paid by Prudential before it receives the form.

If there is more than one Beneficiary, but the Beneficiary form does not specify
their shares, they will share equally. If a Beneficiary dies before you or, with
respect to your spouse, before your spouse, that Beneficiary's interest will
end. It will be shared equally by any remaining Beneficiaries, unless the
Beneficiary form states otherwise.

MODE OF SETTLEMENT RULES

[The rules in this Section apply to Employee or Dependents Insurance payable on
account of your death or, with respect to your spouse, on account of your
spouse's death, when the Variable Universal Life Coverage states that they do.
But these rules are subject to the Limits on Assignments and Effect of Gift
Assignment of Rights of Group Variable Universal Life Insurance Under Another
Group Contract Sections.

"Mode of Settlement" means payment other than in one sum.

Employee or Dependents Life Insurance is normally paid to the Beneficiary in one
sum. But a mode of settlement may be arranged with Prudential for all or part of
the insurance, as stated below.

ARRANGEMENT FOR MODE OF SETTLEMENT: You may arrange a Mode of Settlement by
proper written request to Prudential. If, at your death or, with respect to your
spouse, at your spouse's death, no Mode of Settlement has been arranged for an
amount of Employee or Dependents Life

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<PAGE>

Insurance, the Beneficiary and Prudential may mutually agree on a Mode of
Settlement for that amount.

CONDITIONS FOR MODE OF SETTLEMENT: The Beneficiary must be a natural person
taking in the Beneficiary's own right. A Mode of Settlement will apply to
secondary Beneficiaries only if Prudential agrees in writing. Each installment
to a person must not be less that $20.00. A change of Beneficiary will void any
Mode of Settlement arranged before the change.

CHOICE BY BENEFICIARY: A Beneficiary being paid under a Mode of Settlement may,
if Prudential agrees, choose (or change the Beneficiary's choice of) a payee or
payees to receive, in one sum, any amount which would otherwise be payable to
the Beneficiary's estate.

Information about Modes of Settlement is available from Prudential.]

INCONTESTABILITY OF INSURANCE

This limits Prudential's use of your statements in contesting an amount of
insurance under the [Variable Universal Life Coverage and any of the additional
provisions that may be a part of the Variable Universal Life Coverage] for which
you are insured. These are statements made to persuade Prudential to accept you
for insurance. They will be considered to be made to the best of your knowledge
and belief. These rules apply to each statement:

(1) It will not be used in the contest unless:

(a) It is in a written instrument signed by you; and

(b) A copy of that instrument is or has been furnished to you or, in the
event of your death or incapacity, to your Beneficiary or personal
representative.

(2) If it relates to [a person's] insurability:

(a) it will not be used to contest the validity of the insurance which has
been in force, before the contest, for at least two years during [the
person's] lifetime; or, if later, two years during [the person's]
lifetime from the date [the person's] insurance was reinstated.

(b) with respect to an increase in [that person's] face amount of
insurance, it will not be used to contest the validity of the increase
in the insurance which has been in force, before the contest, for at
least two years during [the person's] lifetime.

--------------------

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<PAGE>

CLAIM RULES

These rules apply to the payment of benefits under [Additional Provisions for
Accidental Death and Dismemberment Coverage and Additional Provisions for
Accidental Motor Vehicle Death Coverage].

PROOF OF LOSS: Prudential must be given written proof of the loss for which
claim is made under [the Additional Provisions for Accidental Death and
Dismemberment Coverage or the Additional Provisions for Accidental Motor Vehicle
Death Coverage]. This proof must cover the occurrence, character and extent of
that loss. It must be furnished within 90 days after the date of the loss. A
claim will not be considered valid unless the proof is furnished within this
time limit. However, it may not be possible to do so. In that case, the claim
will still be considered valid if proof is furnished as soon as possible.

WHEN BENEFITS ARE PAID: Benefits are paid when Prudential receives written proof
of the loss.

[A benefit unpaid at your death will be paid to your estate. But this does not
apply if the Additional Provisions for Accidental Death and Dismemberment
Coverage, the Additional Provisions for Accidental Motor Vehicle Death Coverage
or the Limits on Assignments section on an earlier page states otherwise.]

PHYSICAL EXAM: Prudential, at its own expense, has the right to examine the
person whose loss is the basis of claim. Prudential may do this when and as
often as is reasonable while the claim is pending.

LEGAL ACTION: No action at law or in equity may be brought to recover on the
Group Contract until 60 days after the written proof described above is
furnished. No such action may be brought more than [three] years after the end
of the time period within which proof of loss is required.

--------------------

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<PAGE>

[LIMITS ON ASSIGNMENTS

Unless not allowed in the Schedule of Benefits, you may assign your Employee or
Dependents Insurance under the Variable Universal Life Coverage, including any
of the additional provisions that may be a part of the Variable Universal Life
Coverage. Unless the Schedule of Benefits states otherwise, any rights, benefits
or privileges that you have as an Employee may be assigned only as a gift
assignment. This includes any right to choose a Beneficiary or to convert to
another contract of insurance. An assignment must be in a signed writing.
Prudential will not decide if an assignment does what it is intended to do.
Prudential will not be held to know that one has been made unless it or a copy
is filed with Prudential through the Included Employer.

This paragraph applies only to insurance for which you have the right to name a
Beneficiary, when that right has been assigned. If an assigned amount of
insurance becomes payable on account of the Covered Person's death, and at the
Covered Person's death there is no Beneficiary chosen by the assignee, it will
be payable to:

(1) the assignee, if living; or

(2) the estate of the assignee, if the assignee is not living.

It will not be payable as stated in the Beneficiary Rules.]

[EFFECT OF GIFT ASSIGNMENT OF RIGHTS OF GROUP VARIABLE UNIVERSAL LIFE INSURANCE
UNDER ANOTHER GROUP CONTRACT

If you are eligible for the Variable Universal Life Coverage, including any of
the additional provisions that may be a part of the Variable Universal Life
Coverage, of the Group Contract on the Included Employer's Inclusion Date, you
will have no rights, benefits or privileges under such Coverage if, on the day
before the Inclusion Date, all of the following were true:

(1) You were insured for group variable universal life insurance under another
group contract, and that contract was issued by Prudential or another
insurance carrier to cover Employees of the Included Employer.

(2) Your group variable universal life insurance under the other group contract
ended.

(3) An irrevocable and absolute gift assignment previously made by you: (a) was
in effect; (b) was made before the other group contract ended; and (c) was
of all of your rights, benefits and privileges of the group variable
universal life insurance under the other group contract.

(4) Those rights, benefits and privileges were owned by the assignee or the
assignee's successor.

The owner of those rights of the group variable universal life insurance under
the other group contract on the day before the Included Employer's Inclusion
Date will be the owner of the rights, benefits and privileges you would have had
under the Variable Universal Life Coverage, including any of the additional
provisions that may be a part of the Variable Universal Life Coverage, to the
same extent ownership existed under the other group contract, if this section
did not apply. This includes, but is not limited to, any right of assignment you
would have had under the Limits on Assignments section above. The term
"assignee" as used in that section includes such an owner.

The term "group variable universal life insurance", as used above, means only
group variable universal life insurance provided under Group Contract No. XXX
issued to the KLM Insurance Company.]

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<PAGE>

AGE ADJUSTMENT

If an age is used to determine your contributions for the Variable Universal
Life Coverage[, including any of the additional provisions that may be a part of
that Coverage,] and the age used is found to be in error, Prudential will adjust
the amount of any death benefit payable. The death benefit will be increased or
decreased to reflect the benefit that the contributions you made would have
provided at the correct age.

DEFINITIONS

[ACTIVE WORK REQUIREMENT: A requirement that you be actively at work at the
Included Employer's place of business, or at any other place that the Included
Employer's business requires you to go.]

ATTAINED AGE: The person's age [as of each Contract Anniversary.]

BUSINESS DAY: On any day, the time during which the New York Stock Exchange is
open and the Securities and Exchange Commission has not restricted trading or
declared an emergency.

CASH SURRENDER VALUE: The Cash Surrender Value of Your Certificate Fund is equal
to the Certificate Fund on the date of surrender, less any Certificate Debt[,
any transaction charge and other outstanding charge.]

CERTIFICATE DEBT: The sum of all loans under this Certificate, plus the interest
charged that is not yet due and has not been added to the loans.

CERTIFICATE YEAR: A period of one year measured from the effective date of Your
Certificate and from each successive anniversary of that date.

CONTRACT MONTH: A period of one month measured from the Contract Date and from
each successive monthly anniversary.

CONTRACT YEAR: A period of one year measured from the Contract Date and from
each successive Contract Anniversary.

COVERAGE: A part of the Certificate consisting of:

(1) A benefit page labeled as a Coverage in its title.

(2) Any page or pages that continue the same kind of benefits.

(3) A Schedule of Benefits entry and other benefit pages or forms that by their
terms apply to that kind of benefits.

Covered Person under the Variable Universal Life Coverage[, including any of the
additional provisions that may be a part of the Variable Universal Life
Coverage: An Employee who is insured for Employee Insurance under that Coverage;
a Qualified Dependent for whom an Employee is insured for Dependents Insurance
under that Coverage].

[DEPENDENTS INSURANCE: Insurance on the person of a dependent.]

[DOCTOR: A licensed practitioner of the healing arts acting within the scope of
the license.]

[EARNINGS: This is the gross amount of money paid to you by the Included
Employer in cash for performing the duties required by your job. Bonuses,
overtime pay, Earnings for more than 40 hours per week, and all other benefits
are excluded.]

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<PAGE>

[EMPLOYEE: A person employed by the Included Employer; a proprietor or partner
of the Included Employer. The term also applies to that person for any rights
after insurance ends.]

[EMPLOYEE INSURANCE: Insurance on the person of an Employee.]

[INCLUDED EMPLOYER: An employer who:

(1) has made a written request to Prudential to be included under the Group
Contract; and

(2) has agreed to make required payments to the Contract Holder for the
insurance; and

(3) has been approved by Prudential for inclusion under the Group Contract.]

[INJURY: Injury to the body of a Covered Person.]

INSURANCE: Variable Universal Life Coverage[, and any of the additional
provisions that may be a part of the Variable Universal Life Coverage,] provided
under this Certificate.

LOAN ACCOUNT: An account, which is part of the Covered Person's Certificate
Fund, that is set up by Prudential when you take out a loan.

PRUDENTIAL: The Prudential Insurance Company of America.

[SICKNESS: Any disorder of the body or mind of a Covered Person, but not an
Injury.]

YOU: [An Employee].

--------------------

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<PAGE>

WHEN INSURANCE ENDS

[EMPLOYEE AND DEPENDENTS] INSURANCE

Your [Employee Insurance or your Dependents Insurance] under the Variable
Universal Life Coverage [and any of the additional provisions that may be a part
of the Variable Universal Life Coverage under the Group Contract] will end [on
the first of these to occur:

(1)] The date the Group Contract ends.

[(2) The date your Employer ceases to be an Included Employer.

(3) The last day of the month in which Prudential receives notice that you
cease to be in the Covered Classes for the insurance because your
employment ends (see below) or for any other reason.

(4) The last day of the month in which Prudential receives notice that your
class has been removed from the Covered Classes for the insurance.

(5) The last day of the month in which you fail to pay, when due any
contribution that is required to keep the person's insurance in force. If
the person's insurance is in default, you fail to pay the monthly
contribution required to provide the person's Variable Universal Life
Coverage during the grace period. But failure to pay for Dependents
Insurance will not cause your Employee Insurance to end.

(6) With respect to a dependent spouse who is insured for Variable Universal
Life Coverage, the last day of the month in which that spouse's Variable
Universal Life Coverage and any of the additional provisions that may be a
part of the Variable Universal Life Coverage ends as a result of your death
or divorce.

Your Dependents Insurance for a Qualified Dependent under the Additional
Provisions for Dependents Term Life Coverage will end on the last day of the
month in which that dependent ceases to be a Qualified Dependent for those
provisions.]

[PAID-UP INSURANCE: If a person's Certificate Fund has been used to provide
paid-up insurance, as described in the Paid-up Insurance Section of the Variable
Universal Life Coverage, the paid-up insurance will not end when a person's
insurance ends under other rules of the Group Contract. Unless surrendered, it
will continue until the person's death.]

[END OF EMPLOYMENT: For insurance purposes, your employment will end when you
are no longer a full-time Employee actively at work for the Included Employer.
But, the Included Employer may consider you as still employed in the Covered
Classes during certain types of absences from full-time work. The Included
Employer decides which Employees with those types of absences are to be
considered employed, and for how long. In doing so, the Included Employer must
not discriminate among persons in like situations.

For the purpose of your life insurance under the Group Contract, your employment
in the Covered Classes will not be considered to end while you: (1) are absent
from work for the Included Employer on account of your disability; and (2) have
been so absent for less than six months; and (3) are not working at any other
job for wage or profit.

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<PAGE>

If you stop active full-time work for any reason, you should contact the
Included Employer at once to see what arrangements, if any, have been made to
continue your insurance during such absences.]

[CONTINUED COVERAGE UNDER THE GROUP CONTRACT: If a person's Face Amount of
Insurance under the Variable Universal Life Coverage and any of the additional
provisions made a part of the Variable Universal Life Coverage would, but for
these provisions, end because:

(1) you cease to be in the Covered Classes for the insurance; or

(2) your class has been removed from the Covered Classes for the insurance; or

(3) your employer is no longer an Included Employer; or

(4) with respect to a person who is a dependent spouse, you die or are divorced
from that spouse;

the person's Variable Universal Life Coverage and any of the additional
provisions made a part of the Variable Universal Life Coverage will be continued
beyond the date it would have ended above. But, this will not apply if (1) or
(2) below applies:

(1) A person's Variable Universal Life Coverage under the Group Contract ends
because your employer is no longer an Included Employer and, within 31
days, the person becomes eligible through your employer for group life
insurance coverage, issued by another carrier, that provides for the
accumulation of cash value.

(2) The Variable Universal Life Coverage for your spouse ends as a result of
your death and, at the time of your death, your spouse's coverage was not
assigned.

RULES: The Variable Universal Life Coverage and any additional provisions that
may be a part of the Variable Universal Life Coverage will be continued, subject
to the following rules.

Effective Date: The effective date is the first day of the month after
Prudential receives notice that the person's Variable Universal Life Coverage,
including any of the additional provisions that may be a part of the Variable
Universal Life Coverage, under the Group Contract would have ended.

Contributions: The amount of the contributions required to keep the insurance in
force will be different than the amount you have been contributing.
Contributions will be payable directly to Prudential.

Increases in Face Amount of Insurance: On each Contract Anniversary, you may
request an increase in the Face Amount of Insurance for a person less than age
65 provided:

(1) the amount of the requested increase is $25,000 or more; and

(2) you give evidence of insurability satisfactory to Prudential for the
person.

The Face Amount of Insurance for the person will be increased when Prudential
decides the evidence is satisfactory.

Amount Limitation: The Amount Limitation shown in the Schedule of Benefits is
replaced by the Amount Limitation shown below.

AMOUNT LIMITATION: On the first day of a month coinciding with or next
following a person's attainment of the Limiting Age (shown below), the
person's Face Amount of Insurance is limited. It is the greater of: (a)
five times the person's Certificate Fund on the Business Day coinciding
with or next following the person's attainment of the Limiting Age;

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<PAGE>

and (b) $25,000. But, in no event will the Face Amount of Insurance exceed
the person's Face Amount of Insurance on the day prior to attainment of the
Limiting Age.

Limiting Age: The later of: (a) age 70; and (b) the tenth anniversary of
the day on which the person became insured for the Variable Universal Life
Coverage under the Group Contract.

The Delay of Effective Date section does not apply to this provision.

End of Continued Coverage: Insurance under the Variable Universal Life Coverage
and any of the additional provisions that may be a part of the Variable
Universal Life Coverage will end when the first of these occurs:

(1) The Group Contract ends.

(2) You fail to pay, when due any contribution that is required to keep the
person's Insurance in force. If the person's Insurance is in default, you
fail to pay the monthly contribution required to provide the person's
Variable Universal Life Coverage during the grace period. But failure to
pay for Dependents Insurance will not cause your Employee Insurance to end.

(3) The Certificate Fund that applies to the person has been used to buy
paid-up insurance.

[ATTAINMENT OF AGE 100: When a Covered Person attains age 100, you may elect to:

(1) surrender the Covered Person's Insurance for its Cash Surrender Value, as
described in Section H of the Variable Universal Life Coverage;

(2) purchase paid-up insurance for the person, as described in Section F of the
Variable Universal Life Coverage; or

(3) continue to hold the Certificate.

If you elect (3) above: (a) the monthly Expense Charges for the Cost of
Insurance will no longer be required; and (b) Prudential will no longer accept
contributions, other than to repay Certificate Debt. The person's death benefit
will be equal to the Certificate Fund, less any Certificate Debt outstanding and
any past due monthly charges.

Any additional provisions that may have been part of the Variable Universal Life
Coverage will end.]

--------------------

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<PAGE>

RIDER TO BE ATTACHED TO YOUR GROUP INSURANCE CERTIFICATE

NOTICE OF CHANGE

[EFFECTIVE DATE OF CHANGE: June 1, 19XX*]

GROUP CONTRACT NO.: [GV-XXXXX]

[COVERED CLASSES: All Employees of The A.B.C. Company]

[*Subject to the Certificate's Delay of Effective Date rules]

Your Group Insurance Certificate is changed as follows:

[1. The Non-medical Limit A amount under Non-medical Limits on Face Amount of
Insurance on the Schedule of Benefits is replaced by:

Non-medical Limit A: $YYY,YYY.

2. The Non-medical Limit A amount under Non-medical Limits on Your Spouse's
Face Amount of Insurance on the Schedule of Benefits is replaced by:

Non-medical Limit A: $YYY,YYY.]

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

II-75

April 25, 1997

The Prudential Insurance Company of America
Prudential Plaza
Newark, NJ 07102-3777

Ladies and Gentlemen:

In my capacity as Chief Counsel, Variable Products, Law Department of The
Prudential Insurance Company of America ("Prudential"), I have reviewed the
establishment on June 14, 1988 of The Prudential Variable Contract Account -
GI-2 (the "Account") by the Board of Directors of Prudential as a separate
account for assets applicable to certain variable life insurance contracts,
pursuant to the provisions of Section 17B:28-7 of the Revised Statutes of New
Jersey. I have also reviewed the resolution dated December 10, 1996 of the
Finance Committee of the Board of Directors of Prudential expanding the
investment options in which the Account may invest. I am responsible for
oversight of the preparation and review of the Registration Statement on Form
S-6, as amended, filed by Prudential with the U.S. Securities and Exchange
Commission (Registration No. 333-01031) under the Securities Act of 1933 for
the registration of certain group variable universal life insurance contracts
and certificates thereunder issued with respect to the Account.

I am of the following opinion:

1. Prudential is a corporation duly organized under the laws of the State
of New Jersey and is a validly existing corporation.

2. The Account has been duly created and is validly existing as a
separate account pursuant to the aforesaid provisions of New Jersey
law.

3. The portion of the assets held in the Account equal to the reserve and
other liabilities for variable benefits under the group variable
universal life insurance contracts and the certificates thereunder is
not chargeable with liabilities arising out of any other business
Prudential may conduct.

4. The group variable universal life insurance contracts and the
certificates thereunder are legal and binding obligations of
Prudential, in accordance with their terms.

In arriving at the foregoing opinion, I have made such examination of law and
examined such records and other documents as I judged to be necessary or
appropriate.

I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement.

Very truly yours,

/s/ Clifford E. Kirsch

II-76

April 25, 1997

The Prudential Insurance
Company of America
Prudential Plaza
Newark, NJ 07102-3777

To The Prudential:

This opinion is furnished in connection with the registration by The Prudential
Insurance Company of America of certain Group Variable Universal Life insurance
contracts and certificates ("Contracts") under the Securities Act of 1933. The
prospectus included in Pre-Effective Amendment No. 3 to Registration Statement
No. 333-01031 on Form S-6 describes the Contract. I have reviewed the Contract
form and I have participated in the preparation and review of the Registration
Statement Exhibits thereto. In my opinion:

(1) The illustrations of cash surrender values and death benefits included
in the section of the prospectus entitled "Hypothetical Illustrations
of Death Benefits and Cash Surrender Values," based on the assumptions
stated in this section, are consistent with the provisions of the
respective forms of the Contracts. The rate structure of the Contracts
has not been designed so as to make the relationship between premiums
and benefits, as shown in the illustrations, appear more favorable to
a prospective purchaser of a Contract issued on an individual age 40,
than to prospective purchasers of a Contract for other ages.

(2) The examples shown in the section of the prospectus entitled "Death
Benefits" are consistent with the provisions of the Contract.

(3) The deductions from premium payments for federal taxes in an amount
equal to .35% of each premium is a reasonable charge for these
contracts in relation to the additional income tax burden imposed upon
The Prudential Insurance Company of America as the result of the
enactment of Section 848 of the Internal Revenue Code. In reaching
that conclusion a number of factors were taken into account that, in
my opinion, were appropriate and which resulted in a projected
after-tax deductions allowed in Section 848 in taxable years
subsequent to the year in which the premiums are received.

I hereby consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to my name under the heading "Experts" in the
prospectus.

Very truly yours,

/s/ Stuart L. Liebeskind, FSA, MAAA
Vice President and Actuary
The Prudential Insurance Company of America

II-77