As filed with the Securities and Exchange Commission on
February 27, 1998
Registration No. 333-5529
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
-------------------------------------
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No._____
Post-Effective Amendment No.3
REGISTRATION STATEMENT UNDER THE INVESTMENT ACT OF 1940 [X]
Pre-Effective Amendment No._____
Post-Effective Amendment No.3
-------------------------------------
AMERITAS LIFE INSURANCE CORP. SEPARATE ACCOUNT LLVA
(EXACT NAME OF REGISTRANT)
-------------------------------------
AMERITAS LIFE INSURANCE CORP.
Depositor
5900 "O" Street
Lincoln, Nebraska 68510
-------------------------------------
NORMAN M. KRIVOSHA
Executive Vice President, Secretary
and Corporate General Counsel
Ameritas Life Insurance Corp.
5900 "O" Street
Lincoln, Nebraska 68510
-------------------------------------
Approximate Date of Proposed Public Offering: As soon as practicable after
effective date.
It is proposed that this filing will become effective:
[ ] immediately upon filing pursuant to paragraph b
[x] May 1, 1998 pursuant to paragraph a of Rule 485
-----------
[ ] ___________ pursuant to paragraph b of Rule 485
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
Title of Securities Being Registered Securities of Unit Investment Trust
------------------------------------------
Omit from the facing sheet reference to the other Act if the
Registration Statement or amendment is filed under only one of the Acts.
Include the "Approximate Date of Proposed Public Offering" and "Title of
Securities Being Registered" only where securities are being registered under
the Securities Act of 1933.
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CROSS REFERENCE TO ITEMS REQUIRED BY FORM N-4
PART A
FORM N-4 ITEM HEADING IN PROSPECTUS
<S> <C> <C>
Item 1. Cover Page..............................Cover Page
Item 2. Definitions.............................Definitions
Item 3. Synopsis or Highlights..................Fee Table; Highlights
Item 4. Condensed Financial Information........Condensed Financial Information; Performance Data
Item 5. General Description of Registrant,
Depositor, and Portfolio Companies
a) Depositor............................Ameritas Life Insurance Corp.
b) Registrant...........................The Separate Account
c) Portfolio Company....................The Funds
d) Prospectus...........................The Funds
e) Voting...............................Voting Rights
f) Administrator........................N/A
Item 6. Deductions and Expenses
a) Deductions...........................Fee Table; Highlights; Charges and Deductions
b) Sales load...........................N/A
c) Special purchase plans...............N/A
d) Commissions..........................Distribution of the Policies
e) Portfolio company deductions and
expenses.............................The Funds; Fund Investment Advisory Fees and
Expenses
f) Registrant's Operating Expenses . ..N/A
Item 7. General Description of Variable
Annuity Contracts
a) Rights ..............................Highlights; Policy Features, Annuity Period;
General Provisions; Voting Rights
b) Provisions and limitations...........Highlights; Allocation of Premium; Transfers Among the
Portfolios and the Fixed Account; Systematic Programs
c) Changes in contracts or
operations..........................Addition, Deletion, or Substitution of Investments;
Policy Features; Voting Rights
d) Contractowner inquiries..............Owner Inquiries
Item 8. Annuity Period
a) Level of benefits....................Highlights; Allocation of Premium; Annuity Income
Options
b) Annuity commencement date............Annuity Date
c) Annuity payments.....................Highlights; Annuity Income Options
d) Assumed investment return............Annuity Income Options
e) Minimums.............................Annuity Income Options
f) Rights to change options or
transfer investment base.............Annuity Income Options
Item 9. Death Benefit
a) Death benefit calculation............Highlights; Death of Annuitant; Death of Owner;
Annuity Income Options
b) Forms of benefits....................Highlights; Death of Annuitant; Death of Owner;
Annuity Income Options
Item 10. Purchases and Contract Values
a) Procedures for purchases.............Cover Page; Highlights; Policy Purchase and
Premium Payment; Accumulation Value
b) Accumulation unit value..............Accumulation Value
c) Calculation of accumulation unit
value................................Accumulation Value; Policy Purchase and Premium
Payment
d) Principal underwriter................Distribution of the Policies
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Item 11. Redemptions
a) Redemption procedures................Highlights; Withdrawals and Surrenders
b) Texas Optional Retirement
Program..............................N/A
c) Delay................................Deferment of Payment
d) Lapse................................N/A
e) Revocation rights....................Highlights; Free Look Privilege
Item 12. Taxes
a) Tax consequences.....................Tax Charges; Federal Tax Matters
b) Qualified plans......................Federal Tax Matters
c) Impact of taxes......................Tax Charges
Item 13. Legal Proceedings ......................Legal Proceedings
Item 14. Table of Contents of Statement of
Additional Information..................Table of Contents of Statement of Additional
Information
PART B
FORM N-4 ITEM HEADING IN STATEMENT OF ADDITIONAL INFORMATION
Item 15. Cover page..............................Cover page
Item 16. Table of Contents.......................Table of Contents
Item 17. General Information and History.........General Information and History
Item 18. Services
a) Fees, expenses and costs paid
by other than depositor or
registrant..............................N/A
b) Management-related services..........N/A
c) Custodian and independent public
accountant...........................Safekeeping of Separate Account Assets; Experts
d) Other custodianship..................N/A
e) Administrative servicing agent.......N/A
f) Depositor as principal
underwriter..........................N/A
Item 19. Purchase of Securities Being Offered
a) Manner of Offering...................N/A
b) Sales load...........................N/A
Item 20. Underwriters
a) Depositor or affiliate as principal
underwriter..........................Distribution of the Policy
b) Continuous offering..................Distribution of the Policy
c) Underwriting commissions.............N/A
d) Payments of underwriter..............N/A
Item 21. Calculation of Performance Data.........Calculation of Performance Data
Item 22. Annuity Payments........................N/A
Item 23. Financial Statements
a) Registrant...........................Financial Statements
b) Depositor............................Financial Statements
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PROSPECTUS Ameritas Life Insurance Corp. Logo
5900 "O" Street, P.O. Box 81889
Lincoln, NE 68501
AMERITAS NO LOAD
VARIABLE ANNUITY: A FLEXIBLE
PREMIUM VARIABLE ANNUITY
- --------------------------------------------------------------------------------
This Prospectus describes a no sales load/no surrender charge flexible premium
variable annuity policy contract ("Policy") offered by Ameritas Life Insurance
Corp. ("Ameritas"). The Policy provides a vehicle for investing on a
tax-deferred basis for retirement savings or other long-term purposes.
You may purchase a Policy for $2,000 or more. Minimum additional subsequent
premiums may be $250 or more; smaller amounts may be accepted by automatic bank
draft or at the discretion of Ameritas.
You may direct that premiums accumulate on a variable basis in one or more of
the ten Subaccounts of the Ameritas Life Insurance Corp. Separate Account LLVA
("Separate Account") or on a fixed basis in the Fixed Account, or on a
combination variable and fixed basis. Assets of each Subaccount are invested in
a corresponding Portfolio of Berger Institutional Products Trust ("Berger IPT"),
Neuberger & Berman Advisers Management Trust ("Neuberger & Berman AMT"), Strong
Variable Insurance Funds, Inc. ("Strong VIF"), or Strong Opportunity Fund II,
Inc. (Strong VIF and Strong Opportunity Fund II, Inc. are referred to
collectively as "Strong"),(collectively, the "Funds"). In this Separate Account,
Berger IPT offers two Portfolios: Berger IPT-100 Fund and Berger IPT-Small
Company Growth Fund; Neuberger & Berman AMT offers five Portfolios: Liquid
Asset, Limited Maturity Bond, Growth, Partners, and Balanced; Strong VIF offers
two Portfolios: Strong International Stock Fund II, and Strong Growth Fund II;
Strong Opportunity Fund II, Inc. is also offered.
The Accumulation Value is allocated to the Liquid Asset Portfolio for 13 days
after the Issue Date; the accumulation value is then reallocated as you direct.
Where allowed, if the Owner has allocated 100% to the Fixed Account, the
Accumulation Value of the Policy is allocated to the Fixed Account on the
Effective Date. There is a free-look period in which you may return the Policy
for a refund.
The Accumulation Value will vary with the performance of the Portfolios you
select. You bear all investment risk. Results for the Portfolios are not
guaranteed. Values in the Fixed Account are guaranteed by Ameritas.
You may select a date on which Annuity Payments are to commence. Prior to that
date, a surrender may be made at any time, and withdrawals are allowed, although
in most instances withdrawals made prior to age 59 1/2 are subject to a 10%
federal penalty tax. The Policy offers a number of ways of withdrawing monies
after the Annuity Date, including a lump sum payment and several Annuity Income
Options.
This prospectus contains information you should know before investing; it must
be accompanied by current prospectuses for Berger IPT, Neuberger & Berman AMT,
and Strong. Read the prospectuses carefully and retain them for future
reference. A Statement of Additional Information, which has the same date as
this prospectus, has been filed with the Securities and Exchange Commission; it
is incorporated herein by reference and is available free by writing Ameritas at
the address above. The table of contents of the Statement of Additional
Information appears at the end of this prospectus.
These securities are not deposits with, or obligations of, or guaranteed or
endorsed by, any financial institution; and the securities are not insured by
the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any
other agency. These securities involve investment risk, including the possible
loss of principal.
The Securities and Exchange Commission maintains a web site (http://www.sec.gov)
that contains the Statement of Additional Information, material incorporated by
reference, and other information regarding registrants that file electronically
with the Securities and Exchange Commission.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR BY ANY STATE SECURITIES REGULATORY AUTHORITY, NOR HAS THE
COMMISSION OR ANY STATE SECURITIES REGULATORY AUTHORITY PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this prospectus is May 1, 1998.
- --------------------------------------------------------------------------------
NLVA 1
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TABLE OF CONTENTS
Page
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DEFINITIONS.................................................................................. 3
HIGHLIGHTS................................................................................... 4
FEE TABLE.................................................................................... 6
CONDENSED FINANCIAL INFORMATION.............................................................. 8
PERFORMANCE DATA............................................................................. 9
AMERITAS, THE SEPARATE ACCOUNT AND THE FUNDS................................................. 9
Ameritas Life Insurance Corp.......................................................... 9
The Separate Account.................................................................. 10
The Funds............................................................................. 10
Investment Objectives and Policies.................................................... 11
THE FIXED ACCOUNT............................................................................ 12
POLICY FEATURES.............................................................................. 12
Control of the Policy................................................................. 12
Policy Purchase and Premium Payment................................................... 12
Allocation of Premium................................................................. 13
Accumulation Value.................................................................... 13
Transfers Among the Portfolios and the Fixed Account.................................. 14
Systematic Programs................................................................... 14
Withdrawals and Surrenders............................................................ 14
Free Look Privilege................................................................... 15
CHARGES AND DEDUCTIONS....................................................................... 15
Administrative Charges................................................................ 15
Mortality and Expense Risk Charge..................................................... 16
Tax Charges........................................................................... 16
Fund Investment Advisory Fees and Expenses............................................ 17
ANNUITY PERIOD............................................................................... 17
Annuity Date.......................................................................... 17
Annuity Income Options................................................................ 17
FEDERAL TAX MATTERS.......................................................................... 19
Taxation of Annuities in General...................................................... 19
Nonqualified Policies................................................................. 19
Qualified Policies.................................................................... 20
GENERAL PROVISIONS........................................................................... 20
Annuitant's Beneficiary............................................................... 20
Death of Annuitant.................................................................... 21
Death of Owner........................................................................ 21
Addition, Deletion or Substitution of Investments..................................... 22
Deferment of Payment.................................................................. 22
Owner Inquiries....................................................................... 22
Contestability........................................................................ 22
Misstatement of Age or Sex............................................................ 23
Reports and Records................................................................... 23
DISTRIBUTION OF THE POLICIES................................................................. 23
SAFEKEEPING OF THE SEPARATE ACCOUNT'S ASSETS................................................. 23
THIRD PARTY SERVICES......................................................................... 24
VOTING RIGHTS................................................................................ 24
LEGAL PROCEEDINGS............................................................................ 24
TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION..................................... 25
The Policy, certain provisions, and certain Portfolios are not available in
all states.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT BE LAWFULLY MADE. NO DEALER, SALESPERSON, OR OTHER PERSON
MAY MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE
CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH OTHER INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON.
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2 NLVA
<PAGE>
DEFINITIONS
ACCUMULATION UNIT. A unit used to measure the value of the Policy prior to the
Annuity Date. Analogous, though not identical, to a share owned in a mutual fund
account.
ACCUMULATION UNIT PRICE. The value of each Accumulation Unit is calculated each
Valuation Period. Analogous, though not identical, to the share price (net asset
value) of a mutual fund.
ACCUMULATION VALUE. The value of all amounts accumulated under the Policy prior
to the Annuity Date. On the Issue Date, the Accumulation Value is equal to the
initial premium, less any premium tax, plus any interest credited based on the
Liquid Asset Portfolio value as of the Policy Date.
AMERITAS. ("We, Us, Our") Ameritas Life Insurance Corp., a stock life insurance
company domiciled in Nebraska since 1887.
ANNUITANT. The person upon whose life expectancy the Policy is written. The
Annuitant may also be the Owner of the Policy.
ANNUITANT'S BENEFICIARY. The person to whom any benefits are paid upon the
Annuitant's death.
ANNUITY DATE. The date on which Annuity Payments begin.
ANNUITY INCOME OPTION. A method of receiving Annuity Payments.
ANNUITY PAYMENT. One of a series of payments paid to the Annuitant under an
Annuity Income Option.
EFFECTIVE DATE. The Valuation Date on which premiums are applied to purchase a
Policy.
FIXED ACCOUNT. A part of Ameritas' general account to which all or a portion of
premiums may be allocated for accumulation at fixed rates of interest.
FUNDS. Berger IPT, Neuberger & Berman AMT, and Strong are the Funds available
for investment as of the date of this prospectus. The Funds have one or more
Portfolios; each Portfolio corresponds to one of the Subaccounts of the Separate
Account.
ISSUE DATE. The date all financial, contractual and administrative requirements
have been met to issue the Policy. The free look period begins on this date.
NET PREMIUM. The Premium Payment less the premium tax (if imposed by the state
in which the Policy is delivered).
NONQUALIFIED POLICIES. Policies that do not qualify for special federal income
tax treatment.
OWNER. ("You") The person or entity in whose name the Policy is issued (or as
subsequently changed) who has the privileges stated in the Policy, including the
right to make allocations or change beneficiaries. If a Policy has been
absolutely assigned, the assignee is the Owner. A collateral assignee is not the
Owner.
OWNER'S DESIGNATED BENEFICIARY. The person designated by the Owner to whom
Policy ownership passes upon the Owner's death.
POLICY. The no sales load/no surrender charge variable annuity contract offered
by Ameritas and described in this prospectus.
POLICY DATE. The date used to determine Policy anniversary dates and Policy
Years. On the Issue Date, the Policy Date will be the date within two days after
Ameritas received the application and initial premium. If the Policy Date would
fall on the 29th, 30th or 31st of a month, the Policy Date will be set at the
28th day of that month.
POLICY YEAR. The period from one Policy anniversary date until the next Policy
anniversary date.
NLVA 3
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PORTFOLIO. One of the separate investment Portfolios of the Funds in which the
Separate Account invests. Each Portfolio is a Subaccount of the Separate
Account. In this Separate Account, Berger IPT offers two Portfolios: Berger
IPT-100 Fund and Berger IPT-Small Company Growth Fund; Neuberger & Berman AMT
offers five Portfolios: Liquid Asset, Limited Maturity Bond, Growth, Partners,
and Balanced; Strong VIF offers two Portfolios: Strong International Stock Fund
II, and Strong Growth Fund II; Strong Opportunity Fund II, Inc. is also offered.
In this prospectus, Portfolio will also be used to refer to the Subaccount that
invests in the corresponding Portfolio.
PREMIUM PAYMENT. An amount paid to purchase a Policy or to increase the
investment in the Policy.
QUALIFIED POLICIES. Policies owned inside certain qualified plans as defined
under the Internal Revenue Code of 1986, as amended, such as IRA's and Pension
Trusts.
SATISFACTORY PROOF OF DEATH. All of the following must be submitted: (1) A
certified copy of the death certificate; (2) A Claimant Statement; (3) The
Policy; and (4) Any other information that Ameritas may require to establish the
validity of the claim.
SEPARATE ACCOUNT. Ameritas Life Insurance Corp. Separate Account LLVA, an
account established by Ameritas to receive and invest premiums paid under the
Policy. Assets in the Separate Account are segregated from the general assets of
Ameritas.
SUBACCOUNT. A subdivision of the Separate Account which invests in shares of a
specified Portfolio of the Funds.
VALUATION DATE. Each day that the New York Stock Exchange (NYSE) is open for
trading.
VALUATION PERIOD. The period between two successive Valuation Dates, commencing
at the close of trading on the NYSE on one Valuation Date and ending at the
close of trading on the next Valuation Date.
HIGHLIGHTS
For an explanation of capitalized terms, refer to "Definitions", Page 3.
THE POLICY
The purpose of the Policy is to allow you, the Owner, to accumulate funds on a
tax-deferred basis by investing in one or more investment Portfolios managed by
Berger IPT, Neuberger & Berman AMT, or Strong for retirement or other purposes.
The tax-deferral feature is most attractive to investors who have exhausted
other avenues for tax-deferred investing.
PURCHASING A POLICY
You may purchase a Policy with a complete application and a minimum initial
premium of $2,000 or more. Subsequent premiums must be at least $250. Smaller
premiums may be accepted on automatic bank draft or at the discretion of
Ameritas. Page 12.
INVESTMENT CHOICES
In this Separate Account, Berger IPT offers two Portfolios: Berger IPT-100 Fund
and Berger IPT-Small Company Growth Fund; Neuberger & Berman AMT offers five
Portfolios: Liquid Asset, Limited Maturity Bond, Growth, Partners, and Balanced;
Strong VIF offers two Portfolios: Strong International Stock Fund II, and Strong
Growth Fund II; and Strong Opportunity Fund II, Inc. is also offered. The assets
of each Portfolio are held separately from the other Portfolios; each has
distinct investment objectives and policies which are described in the
accompanying prospectuses for the Funds. The investment performance of the
Portfolios is not guaranteed. Page 9.
Premiums allocated to the Fixed Account are placed in the general account of
Ameritas and receive a guaranteed interest rate. Page 11.
4 NLVA
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ALLOCATION OF PREMIUM
Your Accumulation Value is allocated to the Liquid Asset Portfolio. At the end
of the free look period, the Accumulation Value is allocated among the
Portfolios or Fixed Account according to your instructions on the application.
Allocations may be changed at any time with no charge. Page 13.
CHARGES AND DEDUCTIONS
There are no sales loads or surrender charges. The costs in the Policy include
mortality and expense risk ("M&E") charges; an annual policy fee to cover the
cost to administer the Policy; and investment advisory and other fees imposed by
the Funds. State premium taxes, if any, are deducted upon receipt of premium,
upon annuitization, or upon withdrawal, according to the laws of the state of
jurisdiction. A $10 transfer fee may be charged for each transfer over the 15
free transfers allowed each Policy Year. Page 15.
TRANSFERS AMONG PORTFOLIOS
You may transfer funds among the Portfolios up to 15 times per year free of
charge. Additional transfers may be subject to a transfer charge (maximum $10
per additional transfer). Minimum transfer amount is $250, or if less, the
entire value of the Portfolio from which the transfer is made. The minimum
amount which can remain in a Portfolio as a result of a transfer is $100.
Certain restrictions apply to transfers from the Fixed Account. Systematic
programs, which provide for the automatic transfer of funds, such as Portfolio
Rebalancing, Dollar Cost Averaging, and Earnings Sweep may be offered. Page 13.
WITHDRAWALS
You may withdraw all or part of the Accumulation Value before the earlier of the
Annuity Date or the Annuitant's death. Withdrawals must be at least $250.
Systematic withdrawals may be scheduled at 12 per year. Withdrawals made prior
to age 59 1/2 may be subject to a 10% federal tax penalty. There is no
withdrawal charge. Page 14.
ANNUITY INCOME OPTIONS
Beginning on the Annuity Date, the Policy provides for lump sum payment, or for
periodic annuity payments to be paid to the Annuitant, based on the Accumulation
Value on that date. You may select from a number of Annuity Income Options. You
also have some flexibility in choosing an Annuity Date. Page 17.
DEATH BENEFIT
If the Annuitant dies before the Annuity Date, the death benefit becomes payable
to the Annuitant's Beneficiary upon proof of death. Ameritas guarantees that the
death benefit payable upon death of the Annuitant prior to the Annuity Date will
be the greater of the Accumulation Value or the premium payments made. The death
benefit may be paid in a lump sum or under an Annuity Income Option. Page 17.
If the Owner dies prior to the Annuity Date, the Owner's entire interest in the
Policy must generally be distributed to the Owner's Designated Beneficiary
within five years after the date of death. Under special rules, if the Owner's
interest is payable to the surviving spouse of the Owner, the Policy may be
continued with the surviving spouse treated as the Owner. Page 18.
FREE LOOK PERIOD
You may cancel the Policy within 10 days after you receive it (except in some
states which may require a longer period). To cancel, you must return the
Policy. When the Policy is received by Ameritas, you will be reimbursed all
premiums paid or the premiums adjusted by investment gains or losses, whichever
is more. Page 15.
NLVA 5
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FEE TABLE
The following illustrates the expenses you will bear as Owner, excluding
possible state premium taxes. For a complete discussion of expenses, see
"Charges and Deductions" and the Funds' prospectuses.
<S> <C>
OWNER TRANSACTION EXPENSES
Sales Load Imposed...............................................................None
Surrender Charge.................................................................None
Withdrawal Charge................................................................None
Transfer Fee (after 15 free transfers per Policy year)...........................$10
ANNUAL POLICY FEE (maximum of $40, currently $25).......................................$25
SEPARATE ACCOUNT ANNUAL EXPENSES (AS A PERCENTAGE OF AVERAGE ACCOUNT VALUE)
Mortality and Expense Risk Fees (M&E). . . . . . . . . . . . . . . . . 0.75% current
0.95% guaranteed
FUND MANAGEMENT FEES
Fee information relating to the underlying Funds was provided to Ameritas by the
underlying Funds. Ameritas has not independently verified the information
received from the underlying Funds.
BERGER IPT ANNUAL EXPENSES
INVESTMENT ADVISORY
PORTFOLIO & MANAGEMENT OTHER EXPENSES TOTAL
(REFLECT REIMBURSEMENT) (REFLECT REIMBURSEMENT)
<S> <C> <C> <C>
100 Fund .00%(1) 1.00% 1.00%(1)
Small Company Growth .00%(2) 1.15% 1.15%(2)
</TABLE>
(1) Expenses reflect fee waiver and expense reimbursement. Absent such waiver
and reimbursement, the Investment Advisory Fee would have been 0.75%: and
"Total" Expenses would have been 9.18%.
(2) Expenses reflect fee waiver and expense reimbursement. Absent such waiver
and reimbursement, the Investment Advisory Fee would have been 0.90%: and
"Total" Expenses would have been 5.81%.
NEUBERGER & BERMAN AMT ANNUAL EXPENSES (3)
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<CAPTION>
INVESTMENT MANAGEMENT
PORTFOLIO & ADMINISTRATION FEES OTHER EXPENSES TOTAL
(MAY REFLECT REIMBURSEMENT)
<S> <C> <C> <C>
Liquid Asset (4) .53% .47% 1.00%
Limited Maturity .65% .12% .77%
Growth .83% .07% .90%
Partners .80% .06% .86%
Balanced .85% .19% 1.04%
(3) 12/31/97 fiscal year end.
(4) Expenses reflect expense reimbursement. (See following). Absent such
reimbursement, the total annual expenses would have been 1.12%.
</TABLE>
6 NLVA
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STRONG ANNUAL EXPENSES
INVESTMENT ADVISORY
PORTFOLIO & MANAGEMENT OTHER EXPENSES TOTAL
<S> <C> <C> <C>
Growth Fund II 1.00% .20% 1.20%
International Stock Fund II 1.00% .51% 1.51%
Opportunity Fund II 1.00% .15% 1.15%
</TABLE>
Berger Associates provides investment advisory services to the Berger IPT Funds
available in the Separate Account. Berger Associates has voluntarily agreed to
waive its advisory fee and has voluntarily reimbursed the Funds for additional
expenses to the extent that normal operating expenses in any fiscal year,
including the management fee but excluding brokerage commissions, interest,
taxes and extraordinary expenses, of Berger IPT-100 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.
Neuberger & Berman Advisers Management Trust (the "Trust") is divided into
portfolios ("Portfolios"), each of which invests all of its net investable
assets in a corresponding series ("Series") of Advisers Managers Trust. The
figures reported under "Investment Management and Administration Fees" include
the aggregate of the administration fees paid by the Portfolio and the
management fees paid by its corresponding Series. Similarly, "Other Expenses"
includes all other expenses of the Portfolio and its corresponding Series.
Neuberger & Berman Management Inc., ("NBMI") provides investment management
services to each Series that include, among other things, making and
implementing investment decisions and providing facilities and personnel
necessary to operate the Series. NBMI provides administrative services to each
Portfolio that include furnishing similar facilities and personnel to the
Portfolio. With the Portfolio's consent, NBMI is authorized to subcontract some
of its responsibilities under its administration agreement with the Portfolio to
third parties.
Each Portfolio bears all expenses of its operations other than those borne by
NBMI as administrator of the Portfolio and as distributor of its shares. Each
Series bears all expenses of its operations other than those borne by NBMI as
investment manager of the Series. These expenses include, but are not limited
to, for the Portfolios and the Series, legal and accounting fees and
compensation for trustees who are not affiliated with NBMI; for the Portfolios,
transfer agent fees and the cost of printing and sending reports and proxy
materials to shareholders; and for the Series, custodial fees for securities.
Any expenses which are not directly attributable to a specific Series are
allocated on the basis of the net assets of the respective Series.
NBMI has voluntarily undertaken to limit the above listed Portfolio's expenses
by reimbursing each Portfolio for its operating expenses and its pro rata share
of its corresponding Series' operating expenses, excluding the compensation of
NBMI (with respect to all Portfolios but the Liquid Asset Portfolio), taxes,
interest, extraordinary expenses, brokerage commissions and transaction costs,
that exceed, in the aggregate, 1% per annum of the Portfolio's average daily net
asset value. This undertaking is subject to termination on 60 days' prior
written notice to the Portfolio.
The effect of any expense limitation by NBMI is to reduce operating expenses of
a Portfolio and its corresponding Series and thereby increase total return.
NLVA 7
<PAGE>
Strong Capital Management, Inc. is the investment advisor for the Strong Funds.
From time to time, Strong Capital Management, Inc., may voluntarily waive all or
a portion of its management fee and/or absorb certain expenses for the Fund
without further notification of the commencement or termination of any such
waiver or absorption. Any such waiver or absorption will have the effect of
lowering the overall expense ratio of the Fund and increasing the Fund's return
to investors at the time such amounts were waived and/or absorbed.
EXAMPLE: The following example illustrates expenses you would incur at the end
of a one, three, five or ten-year period on a hypothetical $1,000 allocation to
each Portfolio assuming a 5% annual return. The example reflects expenses of the
Separate Account and the Portfolio, but does not reflect premium taxes which may
apply. The information presented applies whether or not the Policy is (1)
surrendered; (2) annuitized; or (3) not surrendered or annuitized.
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
BERGER IPT
<S> <C> <C> <C> <C>
100 Fund $18 $57 $ 97 $211
Small Company Growth $20 $61 $105 $226
NEUBERGER & BERMAN AMT
Liquid Asset $18 $57 $97 $211
Limited Maturity $16 $50 $86 $186
Growth $17 $54 $92 $200
Partners $17 $52 $90 $196
Balanced $19 $58 $99 $215
STRONG
Growth Fund II $20 $63 $108 $232
International Stock Fund II $23 $72 $123 $263
Opportunity II $20 $61 $105 $226
</TABLE>
The examples assume an average $30,000 annuity investment. These examples should
not be considered a representation of past or future expenses, performance or
return. Actual expenses and/or returns may be greater or less than those shown.
CONDENSED FINANCIAL INFORMATION
The financial statements for Ameritas and Separate Account LLVA (as well as
auditors' reports thereon) are in the Statement of Additional Information.
ACCUMULATION UNIT VALUES
Following are the accumulation unit values for the Subaccounts as of January 22,
1997, when contracts offered by this prospectus were first sold, and December
31, 1997. The number of outstanding accumulation units in each Subaccount as of
January 22, 1997, and December 31, 1997, is also shown.
8 NLVA
<PAGE>
<TABLE>
<CAPTION>
ACCUMULATION UNIT NUMBER OF UNITS
----------------- ---------------
VALUE AS OF: OUTSTANDING AS OF:
------------ ------------------
January 22, 1997 December 31,1997 January 22, 1997 December 31, 1997
---------------- ---------------- ---------------- -----------------
BERGER IPT
<S> <C> <C> <C> <C>
100 Fund 10.97 11.748 0 12,757
Small Company Growth 10.38 11.979 0 5,387
NEUBERGER & BERMAN AMT
Liquid Asset 1.00 1.037 0 289,768
Limited Maturity 14.08 14.899 0 33,642
Growth 27.51 30.355 0 2,405
Partners 17.31 20.480 0 28,567
Balanced 16.57 18.892 0 11,464
STRONG
Growth Fund II 10.69 12.888 0 1,460
International Stock Fund II 11.52 9.646 0 6,593
Opportunity Fund II 19.62 23.979 0 1,876
</TABLE>
PERFORMANCE DATA
Separate Account LLVA may advertise certain information regarding the
performance of the Subaccounts. Performance data may be advertised as average
annual total return and/or cumulative total return. The Liquid Asset Subaccount
may advertise yield and/or effective yield. The yield figures are based on
historical earnings and are not intended to indicate future performance. Other
Subaccounts may advertise current yield. Details on how performance measures are
calculated for the Subaccounts are found in the Statement of Additional
Information. Performance advertising will reflect the mortality and expense risk
charge and the annual policy fee.
AMERITAS, THE SEPARATE ACCOUNT AND THE FUNDS
AMERITAS LIFE INSURANCE CORP.
Ameritas Life Insurance Corp. ("Ameritas") is a stock life insurance company
domiciled in Nebraska since 1887. Ameritas and its subsidiaries are currently
licensed to sell life insurance and annuities in 50 states and the District of
Columbia. The Home Office of Ameritas is at 5900 "O" Street, P.O. Box 81889,
Lincoln, Nebraska 68501.
Effective January 1, 1998, Ameritas converted from a mutual insurance company
structure to a mutual insurance holding company structure pursuant to the
Nebraska Mutual Insurance Holding Company Act. The conversion was approved by
the Nebraska State Department of Insurance and the policyowners of the mutual
company.
Ameritas and subsidiaries had total assets at December 31, 1997 of over $3.4
billion. Ameritas enjoys a long standing A+ ("Superior") rating from A.M. Best,
an independent firm that analyzes insurance carriers. Ameritas also has been
rated A ("Excellent") by Weiss Research, Inc., and an AA ("Excellent") rating
from Standard & Poor's for claims-paying ability.
Ameritas Investment Corp., the principal underwriter of the Policies, may
publish in advertisements and reports to Policyowners, the ratings and other
information assigned to Ameritas by one or more independent rating services and
charts and other information concerning dollar cost averaging,
NLVA 9
<PAGE>
portfolio rebalancing, earnings sweep, tax-deference, diversification, asset
allocation, long-term market trends, index performance, and other investment
programs and methods. Ameritas may also publish information about Veritas,
Ameritas' wholly owned, direct-to-the-consumer subsidiary, and may advertise the
no load nature of this Policy. The purpose of the ratings is to reflect the
financial strength and/or claims-paying ability of Ameritas. The ratings do not
relate to the performance of the Separate Account.
THE SEPARATE ACCOUNT
Ameritas Life Insurance Corp. Separate Account LLVA ("Separate Account") was
established under Nebraska law on October 26, 1995 to receive and invest
premiums paid under the Policy. Assets of the Separate Account are held
separately from all other assets of Ameritas and are not chargeable with
liabilities from any other business Ameritas may conduct. Income, gains, or
losses of the Separate Account are credited without regard to other income,
gains, or losses of Ameritas.
The Separate Account purchases and redeems shares from the Portfolios at the net
asset value. Shares are redeemed for Ameritas to pay withdrawals and surrenders,
collect charges, and transfer assets from one Portfolio to another, or to the
Fixed Account, as requested by the Owner. Any dividend or capital gain
distribution is automatically reinvested in the corresponding Subaccount.
All obligations arising under the Policies are liabilities of Ameritas. Ameritas
will always keep assets in the Separate Account of a total market value at least
equal to the reserve and other contract liabilities of the Separate Account. To
the extent that assets in the Separate Account exceed Ameritas' liabilities in
the Separate Account, Ameritas may withdraw excess assets to cover general
account obligations.
The Separate Account is a unit investment trust registered with the Securities
and Exchange Commission ("SEC") under the Investment Company Act of 1940 ("1940
Act"). Such registration does not signify that the SEC supervises the
management, investment practices or policies of the Separate Account.
THE FUNDS
The Funds currently available are: Berger IPT, Neuberger & Berman AMT, and
Strong. Each Fund is registered with the SEC under the 1940 Act as an open-ended
diversified management investment company or a series thereof. There are
currently ten Subaccounts within the Separate Account, each investing only in a
corresponding Portfolio of the Funds. Two Portfolios of Berger IPT, five
Portfolios of Neuberger & Berman AMT, and three Portfolios of Strong are offered
for investment in the Policy.
The assets of each Portfolio of the Funds are held separate from the assets of
the other Portfolios. Thus, each Portfolio operates as a separate investment,
and the income or losses of one Portfolio generally do not affect the investment
of any other Portfolio.
The investment objectives and policies of each Portfolio are summarized below.
There is no assurance that any Portfolio will achieve stated objectives. More
detailed information, including a description of investment risks, investment
advisory services, total expenses and charges is in the prospectuses of the
Funds, which accompany this Prospectus. These prospectuses should be read in
conjunction with this Prospectus and retained. All underlying Fund information,
including Fund prospectuses, has been provided to Ameritas by the Funds.
Ameritas has not independently verified this information.
You should periodically reconsider your allocation among the Portfolios in light
of current market conditions and the investment risks attendant to investing in
the Portfolios.
10 NLVA
<PAGE>
Berger IPT, Neuberger & Berman AMT, and Strong may be made available for
variable annuity or variable life insurance contracts of various insurance
companies. Though unlikely, there is a possibility that a material conflict
could arise between the interests of the Separate Account and one or more of the
separate accounts of another participating insurance company. In the event of a
material conflict, the affected insurance companies agree to take any necessary
steps, including removing separate accounts from the Funds, to resolve the
matter. See the prospectuses of the Funds for more information.
INVESTMENT OBJECTIVES AND POLICIES OF THE FUNDS' PORTFOLIOS
There is no assurance that a Portfolio will achieve its stated objective.
BERGER IPT
100 FUND seeks long-term capital appreciation. Current income is not an
investment objective. The Fund places primary emphasis on established companies
which it believes to have favorable growth prospects, regardless of the
company's size. Common stock usually constitutes all or most of the Fund's
investment portfolio, but the Fund remains free to invest in securities other
than common stocks.
SMALL COMPANY GROWTH FUND seeks capital appreciation. It invests principally in
a diversified group of equity securities of small growth companies with market
capitalization of less than $1 billion at the time of initial purchase.
NEUBERGER & BERMAN AMT
LIQUID ASSET seeks the highest current income consistent with safety and
liquidity. Principal series investments are high-quality Money Market
instruments of government and non-government issuers.
LIMITED MATURITY BOND seeks the highest current income consistent with low risk
to principal and liquidity; and secondarily, total return. Principal series
investments are short-to-intermediate term debt securities, primarily investment
grade.
GROWTH seeks capital appreciation, without regard to income. Principal series
investments are common stocks.
PARTNERS seeks capital growth. Principal series investments are common stocks
and other equity securities of established companies.
BALANCED seeks long-term capital growth and reasonable current income without
undue risk to principal. Principal series investments are common stocks and
short-to-intermediate term debt securities, primarily investment grade.
STRONG
GROWTH FUND II seeks capital growth. It invests primarily in equity securities
that its advisor believes have above-average growth prospects.
INTERNATIONAL STOCK FUND II seeks capital growth. It invests primarily in the
equity securities of issuers located outside the United States.
OPPORTUNITY FUND II seeks capital growth. It invests primarily in equity
securities and currently emphasizes investments in medium-sized companies that
its advisor believes are under-researched and attractively valued.
NLVA 11
<PAGE>
THE FIXED ACCOUNT
You may allocate all or a portion of your Premium Payments and make transfers to
the Fixed Account. Amounts in the Fixed Account earn a fixed rate of interest
guaranteed by Ameritas never to be less than 3.0%.
Amounts allocated to the Fixed Account receive an interest rate declared
effective for the month of issue. The declared interest rate is guaranteed for
the remainder of the Policy Year. During subsequent Policy Years, all amounts in
the Fixed Account will earn the interest rate that was declared in the month of
the last Policy anniversary. Declared interest rates may be lower or higher than
the previous period.
Amounts allocated to the Fixed Account or transferred from the Separate Account
to the Fixed Account are placed in the General Account of Ameritas, which
supports insurance and annuity obligations. The General Account includes all of
Ameritas' assets, except those assets segregated in the separate accounts.
Ameritas has the sole discretion to invest the assets of the General Account,
subject to applicable law. Ameritas bears an investment risk for all amounts
allocated or transferred to the Fixed Account and interest credited thereto,
less any deduction for charges and expenses, whereas the Owner bears the
investment risk that the declared interest rate described above may fall to a
lower rate after the expiration of a declared rate period.
Because of exemptive and exclusionary provisions, interests in the General
Account have not been registered under the Securities Act of 1933 nor is the
General Account registered as an investment company under the Investment Company
Act of 1940. Accordingly neither the General Account nor any interest therein is
generally subject to the provisions of the 1933 or 1940 Act. We understand that
the SEC has not reviewed the disclosures in this Prospectus relating to the
Fixed Account portion of the Contract; however, disclosures regarding the Fixed
Account portion of the Contract may be subject to generally applicable
provisions of the Federal Securities Laws regarding the accuracy and
completeness of statements made.
POLICY FEATURES
The Policy is a variable annuity contract issued by Ameritas. The rights and
benefits of the Policy are described below and in the Policy. The Policy
controls the rights and benefits you have. Ameritas reserves the right to make
any modification to conform the Policy to, or to give you the benefit of, any
changes in the law. If necessary, Ameritas will provide notice of such
modifications to, and receive approval from, the SEC and/or state insurance
authorities. You will be notified of any material modifications to the Policy.
CONTROL OF THE POLICY
The Owner is the person or entity named as such in the application or in
subsequent written changes shown in Ameritas records. While living, the Owner
has the sole right to receive all benefits and exercise all rights granted by
the Policy or Ameritas. The Owner may name both primary and contingent
beneficiaries. Subject to the rights of any irrevocable beneficiary and any
assignee of record, all rights, options, and privileges belong to the Owner, if
living; otherwise to any successor-owner or Owners, if living; otherwise to the
estate of the last Owner to die.
POLICY PURCHASE AND PREMIUM PAYMENT
Individuals wishing to purchase a Policy should send a complete application and
an initial premium to Ameritas' Home Office (5900 "O" Street, P.O. Box 81889,
Lincoln, NE 68501). Your initial premium must be equal to or greater than the
minimum $2,000 requirement. The named Annuitant must be 85 years of age or less.
Acceptance is subject to Ameritas' underwriting rules and complete application.
Ameritas reserves the right to reject any application.
12 NLVA
<PAGE>
If the application and initial Premium Payment can be accepted in the form
received, the initial premium will be applied to purchase the Policy within two
business days from the date the premium was received. The date the initial
premium is applied to purchase the Policy is the Effective Date.
If an incomplete application is received, we will request the necessary
information to complete the application. If after five business days from
receipt of the initial premium, the application remains incomplete, we will
return the initial premium unless we obtain your permission to retain the
premium pending completion of the application. Once the application is complete
and we have received the initial premium, the premium will be applied within two
business days.
Additional Premium Payments may be made at any time prior to the Annuity Date,
as long as the Annuitant is living. Additional payments must be made for at
least $250, however, smaller amounts may be accepted if made by automatic bank
draft or at Ameritas' discretion. Any additional premium is credited to the
Accumulation Value as of the date of receipt or the next Valuation Date if
received on a day when the NYSE is not open for trading.
Total premiums may not exceed $1,000,000 for either a single Policy or for
multiple Ameritas annuity Policies having the same Annuitant without prior
approval from Ameritas.
ALLOCATION OF PREMIUM
You may allocate premium to one or more of the Portfolios and to the Fixed
Account. Allocated portions must be a whole number percentage. The allocations
must total 100%.
On the Issue Date, the policy's Accumulation Value will be based on the Liquid
Asset Portfolio value as if the Policy had been issued and the initial Net
Premium invested within two Valuation Dates of receipt by Ameritas of the
application and initial premium ("the two day date"). On the Effective Date, the
Accumulation Value is allocated to the Liquid Asset Portfolio, unless, where
available, the Owner has allocated 100% to the Fixed Account. Thirteen days
after the Issue Date, the Accumulation Value of the Policy will be allocated
among the Portfolios, or to the Fixed Account as selected by the Owner in the
application.
Where allowed, if the Owner has allocated 100% to the Fixed Account, the
Accumulation Value of the Policy is allocated to the Fixed Account on the
Effective Date. In this instance, no further allocation will occur.
The Owner bears the entire investment risk for the portion of the Accumulation
Value allocated to the Portfolios. This will affect the Policy's Accumulation
Value, which on the Annuity Date affects the level of annuity payments payable.
You should periodically review your allocation in light of market conditions and
your financial objectives.
ACCUMULATION VALUE
On the Effective Date, the Accumulation Value of the Policy is equal to the
initial premium received, less any applicable premium taxes, plus any interest
credited based on the Liquid Asset Portfolio value as of the Policy Date.
Thereafter, the Accumulation Value is determined on each Valuation Date by
multiplying the number of Accumulation Units of each Subaccount by the current
Accumulation Unit Price for that Subaccount and by adding each together with the
amount in the Fixed Account. The number of Accumulation Units credited to the
Policy is decreased by any annual policy fee, any withdrawals, and, upon
annuitization, any applicable premium taxes.
When a portion of the Accumulation Value is allocated to a Portfolio, a certain
number of Accumulation Units are credited to your Policy. The number of
Accumulation Units is determined by dividing the dollar amount allocated to the
Portfolio by the Accumulation Unit Price for that Portfolio as of the end of the
Valuation Period in which the allocation is made.
NLVA 13
<PAGE>
The Accumulation Units of each Portfolio are valued separately. The Accumulation
Unit Price may vary each Valuation Period according to the net investment
performance of the Portfolio, the daily charges under the Policy, and, any
applicable tax charges.
Therefore, the Accumulation Value of your Policy will vary from Valuation Period
to Valuation Period, reflecting the investment experience of the selected
Portfolios of the Funds, the interest earned in the Fixed Account, additional
Premium Payments, withdrawals and the deduction of any charges.
TRANSFERS AMONG PORTFOLIOS AND THE FIXED ACCOUNT
You may make transfers among the Portfolios and/or the Fixed Account 15 times
each Policy Year without charge. A transfer charge of $10 may be imposed for
each additional transfer. This charge will be deducted pro rata from each
Subaccount (and, if applicable, the Fixed Account) in which the Policyowner is
invested. Each transfer must be at least $250, or the balance of the Portfolio,
if less. You may make unlimited transfers from the Portfolios to the Fixed
Account. You may also transfer from the Fixed Account amounts up to the greater
of: 25% of the Accumulation Value of the Fixed Account; the amount of any
transfer from the Fixed Account during the prior thirteen months; or $1,000 to
the various Portfolios during the 30 day period following the Policy anniversary
date. This provision is not available while dollar cost averaging from the Fixed
Account. The minimum amount that may remain in a Portfolio or the Fixed Account
after a transfer is $100.
You may initiate transactions by telephone. Ameritas will employ reasonable
procedures to confirm that telephone instructions are genuine. Ameritas
procedures for transactions initiated by telephone include, but are not limited
to, requiring the Owner to provide the policy number at the time of giving
transfer instructions; tape recording of all telephone transfer instructions;
and the provision, by Ameritas, of written confirmation of the telephone
transactions. Ameritas will effect transfers and determine all values in
connection with transfers at the end of the Valuation Period during which the
transfer request is received at the Home Office.
Transfers may be subject to additional limitations by the Funds.
SYSTEMATIC PROGRAMS
Ameritas may offer systematic programs as discussed below. Transfers of
Accumulation Value made within programs will be counted in determining whether
the transfer fee applies. Lower minimum amounts may be allowed to transfer as
part of a systematic program. There is no separate charge for participation in
these programs at this time. All other normal transfer restrictions, as
described above, may apply.
PORTFOLIO REBALANCING. Portfolio rebalancing is a method to maintain your
original allocation proportions among Portfolios. Under this program, the Owner
can instruct Ameritas to reallocate Accumulation Value among the Portfolios, on
a systematic basis, in accordance with allocation instructions specified by the
Owner. The Fixed Account can not be used in this program.
DOLLAR COST AVERAGING. Under the Dollar Cost Averaging program, the Owner can
instruct Ameritas to automatically transfer, on a systematic basis, a
predetermined amount or percentage specified by the Owner from the Fixed Account
or the Liquid Asset Subaccount to any other Subaccount(s). Dollar cost averaging
is permitted from the Fixed Account, if no more than 1/36th of the value of the
Fixed Account at the time dollar cost averaging is established is transferred
each month.
EARNINGS SWEEP. Permits systematic redistribution of earnings among Portfolios.
The Owner can request participation in the available systematic programs when
purchasing the Policy or at a later date. The Owner can change the allocation
percentage or discontinue any program by
14 NLVA
<PAGE>
sending written notice or calling the Home Office. Other scheduled programs may
be made available. Ameritas reserves the right to modify, suspend or terminate
such programs at any time. Use of Systematic Programs may not be advantageous,
and does not guarantee success.
WITHDRAWALS AND SURRENDERS
Any time prior to the Annuity Date and while the Annuitant is still living, you
may make withdrawals or surrender the Policy to receive part or all of the
Accumulation Value. No withdrawal or surrender may be made after the Annuity
Date except as permitted under a particular Annuity Income Option.
The amount available for withdrawal is the Accumulation Value at the end of the
Valuation Period during which the written request for withdrawal is received,
less any applicable premium taxes and in the case of a surrender, also less the
annual policy fee that would be due on the last Valuation Date of the Policy
Year.
In the absence of specific direction from the Owner, amounts will be withdrawn
from the Subaccounts and the Fixed Account on a pro rata basis. The minimum
withdrawal amount is $250. Any withdrawal request that would reduce the
Accumulation Value to less than $1,000 will be considered a request for policy
surrender.
Since the Owner assumes the investment risk with respect to amounts allocated to
the Separate Account, the total amount paid upon withdrawal under the Policy
(taking into account any prior withdrawals) may be more or less than the total
Premium Payments made. The surrender value may be paid in a lump sum to the
Owner, or, if elected, all or any part may be paid out under an Annuity Income
Option. (See "Annuity Income Options".)
Your proceeds will be paid within seven days of receipt of written request for
withdrawal or surrender, on a form approved by Ameritas, subject to postponement
in certain circumstances. (See "Deferment of Payment".) Payments under the
Policy of any amounts derived from a premium paid by check may be delayed until
the check has cleared the payor's bank.
If, at the time the Owner makes a withdrawal request, he or she has not provided
Ameritas with a written election not to have federal income taxes withheld,
Ameritas must by law withhold such taxes from the taxable portion of the
withdrawal and remit that amount to the federal government. Moreover, the
Internal Revenue Code provides that a 10% penalty tax may be imposed on certain
early withdrawals. (See "Federal Tax Matters.")
SYSTEMATIC WITHDRAWALS. A systematic withdrawal option is available. Automatic
withdrawals may be taken on a monthly, quarterly, semi-annual or annual mode.
FREE LOOK PRIVILEGE
A free look period is given to examine a Policy and return it for a refund. The
Owner may cancel the Policy within 10 days after receipt of the Policy, unless
state law requires a longer period of time. The refund is equal to the greater
of the premiums paid or the premiums adjusted by investment gains or losses. To
cancel the Policy, the Owner should return it to the selling agent, or to
Ameritas at the Home Office. A refund, if the premium was paid by check, may be
delayed until the check has cleared the Owner's bank.
CHARGES AND DEDUCTIONS
There is no sales load, no withdrawal charge, and no surrender charge.
Charges will be deducted periodically from the Accumulation Value of the Policy
to compensate Ameritas for, among other things: (1) issuing and administering
the Policy; and (2) assuming certain
NLVA 15
<PAGE>
risks in connection with the Policy. The nature and amount of these charges are
described more fully below.
No deductions are made from the Premium Payments before they are allocated to
the Separate Account or Fixed Account, unless taxes are imposed by state law
upon the receipt of a Premium Payment. In that case Ameritas will deduct the
premium tax due when the premiums are received.
ADMINISTRATIVE CHARGES
ANNUAL POLICY FEE. An annual policy fee of up to $40.00 (currently $25.00) is
deducted from the Accumulation Value on the last Valuation Date of each Policy
Year or upon a surrender. This charge reimburses Ameritas for the administrative
costs of maintaining the Policy on Ameritas' system and the cost of reporting to
Owners.
Ameritas does not expect to make a profit on the charges for the annual policy
fee.
TRANSFER CHARGE. Transfer charges may be levied. (See "Transfers Among
Portfolios and the Fixed Account.")
MORTALITY AND EXPENSE RISK CHARGE
Ameritas imposes a charge as compensation for bearing certain mortality and
expense (M&E) risks under the Policies. The charge is assessed daily and is
equal to an annual rate of .75% of the value of the average daily net assets of
the Separate Account. Ameritas guarantees that this charge will never exceed
.95%. If this charge is insufficient to cover assumed risks, the loss will fall
on Ameritas. Conversely, if the charge proves more than sufficient, any excess
will be added to Ameritas' surplus. No M&E charge is imposed on the Fixed
Account.
The mortality risk borne by Ameritas, assuming the selection of one of the forms
of life annuities, is to make monthly Annuity Payments (determined in accordance
with the annuity tables and other provisions contained in the Policies)
regardless of how long all annuitants may live. This undertaking assures that
neither an Annuitant's own longevity, nor an improvement in life expectancy
greater than expected, will have any adverse affect on the monthly annuity
payments the Annuitant will receive. It therefore relieves the Annuitant from
the risk of outliving the funds accumulated for retirement.
In addition, Ameritas bears a mortality risk under the Policies, regardless of
the Annuity Income Option selected, in that it guarantees the purchase rates for
the Annuity Income Options available under the Policy and it guarantees that the
death benefit payable upon death of the Annuitant prior to the Annuity Date will
be the greater of the Accumulation Value or the Premium Payments made.
The expense risk undertaken by Ameritas, with respect to the Account, is that
the deductions for administrative costs under the Policies may be insufficient
to cover the actual future costs incurred by Ameritas for providing
administration services.
If the annual policy fee is insufficient to cover the administration expenses,
the deficiency will be met from Ameritas' General Account funds, including the
amount derived from the charge levied for mortality and expense risks.
TAX CHARGES
The Owner will pay premium taxes that currently range from 0% to 3.5% of the
premium paid, where such taxes are imposed by the state law of the Owner's
residence. States impose premium taxes either upon receipt, by the company, of a
premium payment, or upon annuitization or
16 NLVA
<PAGE>
withdrawals. Ameritas will charge and deduct premium taxes as required by state
law and in accordance with any applicable company election. Applicable premium
tax rates are subject to change. The Owner will be notified of any applicable
premium taxes. You are responsible for informing Ameritas in writing of changes
of residence.
Under present laws, Ameritas will incur state or local taxes (in addition to the
premium taxes described above) in several states. At present, these taxes are
not significant; thus, Ameritas does not currently make a charge for these other
taxes. If they increase, however, Ameritas may charge for such taxes. Such
charges would be deducted from the Accumulation Value.
Ameritas does not expect to incur any federal income tax liability attributable
to investment income or capital gains retained as part of the reserves under the
Policies. Based upon these expectations, no charge is being made currently to
the Separate Account for corporate federal income taxes which may be
attributable to the Separate Account. Ameritas will periodically review the
question of a charge to the Separate Account for corporate federal income taxes
related to the Separate Account. Such a charge may be made in future years for
any federal income taxes incurred by Ameritas. This might become necessary if
the tax treatment of Ameritas is ultimately determined to be other than what we
currently believe it to be, if there are changes made in the federal income tax
treatment of annuities at the corporate level, or if there is a change in
Ameritas' tax status. In the event that Ameritas should incur federal income
taxes attributable to investment income or capital gains retained as part of the
reserves under the Policy, the Accumulation Unit Price would be correspondingly
adjusted. See "Federal Tax Matters".
FUND INVESTMENT ADVISORY FEES AND EXPENSES
The value of the assets in the Separate Account will reflect investment advisory
fees and other expenses incurred by the Funds. Fund expenses are found in the
Funds' prospectuses, and Statements of Additional Information, and the Fee Table
of this prospectus.
ANNUITY PERIOD
ANNUITY DATE
The Annuity Date is the date that Annuity Payments are scheduled to begin,
unless the Policy has been surrendered or the Annuitant is deceased and an
amount has been paid as proceeds prior to that date. The Annuity Date will be
the later of the fifth Policy anniversary date or the Policy anniversary which
is nearest the Annuitant's 85th birthday.
However, the Owner may specify an Annuity Date at the time of purchase which may
be extended up to the Policy anniversary nearest the Annuitant's 95th birthday.
The 29th, 30th, or 31st day of any month may not be selected as the Annuity
Date.
An Annuity Date may only be changed by written request during the Annuitant's
lifetime. Written request to change the Annuity Date must be received at the
Ameritas Home Office at least 30 days before the currently scheduled Annuity
Date. The Annuity Date and Annuity Income Options available for Qualified
contracts may also be controlled by endorsements, the plan, or applicable law.
ANNUITY INCOME OPTIONS
If the Annuitant is living on the Annuity Date and the Policy is in force,
Annuity Payments will be made to the Annuitant according to the terms of the
Policy and the Annuity Income Option selected.
NLVA 17
<PAGE>
The amounts of any Annuity Payments payable will be based on the Accumulation
Value as of the Annuity Date less any premium taxes, if applicable. Thereafter,
the monthly Annuity Payment will not change, except in the event the Interest
Payment Option is elected, in which case the payment will vary based on the rate
of interest determined by Ameritas. All or part of the Accumulation Value may be
placed under one or more Annuity Income Options. If annuity payments are to be
paid under more than one option, Ameritas must be told what part of the
Accumulation Value is to be paid under each option.
The Annuity Income Options are shown below. Election of an Annuity Income Option
must be made by written request to Ameritas at least thirty (30) days in advance
of the Annuity Date. If no election is made, payments will be made as a Life
Annuity as shown below. Subject to Ameritas' approval, the Owner (or after the
Annuitant's death, the Annuitant's Beneficiary) may select any other Annuity
Income Option Ameritas then offers. Annuity Income Options are not available to:
(1) an assignee; or (2) any other than a natural person except with Ameritas'
consent.
If an Annuity Income Option selected does not generate monthly payments of at
least $100, Ameritas reserves the right to pay the Accumulation Value as a lump
sum payment or to change the frequency. If an Annuity Income Option is chosen
which depends on the continuation of life of the Annuitant, proof of birth date
may be required before Annuity Payments begin. For Annuity Income Options
involving life income, the actual age of the Annuitant or joint Annuitant will
affect the amount of each payment. Since payments to older Annuitants are
expected to be fewer in number, the amount of each Annuity Payment may be
greater. For Annuity Income Options that do not involve life income, the length
of the payment period may affect the amount of each payment: the shorter the
period, the greater the amount of each Annuity Payment.
The following Annuity Income Options are currently available:
INTEREST PAYMENT. Ameritas will hold any amount applied under this option and
pay or credit interest on the unpaid balance each month at a rate determined by
Ameritas.
DESIGNATED AMOUNT ANNUITY. Monthly annuity payments will be for a fixed amount.
Payments continue until the amount Ameritas holds runs out.
DESIGNATED PERIOD ANNUITY. Monthly annuity payments are paid for a period
certain, as the Owner elects, up to 20 years.
LIFE ANNUITY. Monthly annuity payments are paid for the life of an Annuitant,
ceasing with the last Annuity Payment due prior to his or her death. Variations
provide for guaranteed payments for a period of time.
JOINT AND LAST SURVIVOR ANNUITY. Monthly annuity payments are paid based on the
lives of the two annuitants and thereafter on the life of the survivor, ceasing
with the last Annuity Payment due prior to the survivor's death.
The rate of interest payable under the Interest Payment, Designated Amount
Annuity or Designated Period Annuity Options will be guaranteed to be no less
than 3% compounded yearly. Payments under the Life Annuity and Joint and Last
Survivor Annuity Options will be based on the 1983 Table "a" Individual Annuity
Table, projected for seventeen years, at 3 1/2% interest. Ameritas may, at any
time of election of an Annuity Income Option, offer more favorable rates in lieu
of the guaranteed rates specified in the Annuity Tables. These rates may be
based on Annuity Tables which distinguish between males and females.
Under current administrative practice, Ameritas allows the beneficiary to
transfer amounts applied under the Interest Payment, Designated Amount Annuity,
and Designated Period Annuity Options to either the Life Annuity or Joint and
Last Survivor Annuity Option after the Annuity Date. However, there is no
guarantee that Ameritas will continue this practice which can be changed at any
time at Ameritas' discretion.
18 NLVA
<PAGE>
FEDERAL TAX MATTERS
INTRODUCTION
The following discussion is general in nature and is not intended as tax advice.
It is not intended to address the tax consequences resulting from all of the
situations in which a person may be entitled to or may receive a distribution
under a contract. You should consult a competent tax adviser before purchasing a
policy. This discussion is based upon Ameritas' understanding of the present
federal income tax laws as they are currently interpreted by the Internal
Revenue Service. No representation is made as to the likelihood of the
continuation of the present federal income tax laws or of the current
interpretation by the Internal Revenue Service. Moreover, no attempt has been
made to consider any applicable state or other tax laws, other than premium
taxes. (See "Tax Charges".)
TAXATION OF ANNUITIES IN GENERAL
NONQUALIFIED POLICIES. Section 72 of the Internal Revenue Code (the Code)
governs taxation of annuities. In general, the Owner is not taxed on increases
in the value of a Policy until some form of distribution is made under the
Policy. The exception to this rule is the treatment afforded to Owners that are
not natural persons. Generally, an Owner that is not a natural person must
include in income any increase in excess of the Owner's cash value over the
Owner's "investment in the policy" during the taxable year, even if no
distribution occurs. There are, however, exceptions to this rule which you may
wish to discuss with your tax counsel. The following discussion applies to
Policies owned by natural persons.
The taxable portion of a distribution (in the form of an annuity or lump sum
payment) is taxed as ordinary income, subject to any income averaging rules
applicable to taxpayers generally. For this purpose, the assignment, pledge, or
agreement to assign or pledge any portion of the Accumulation Value generally
will be treated as a distribution. A transfer of ownership of the Policy without
full and adequate consideration will also be treated as a distribution under the
Internal Revenue Code, unless the transfer falls within an exception for
transfers between spouses. Generally, in the case of a withdrawal under a
Nonqualified Policy, amounts received which are allocable to "investment in the
policy" made after August 13, 1982 are first treated as taxable income to the
extent that the Accumulation Value immediately before the withdrawal exceeds the
"investment in the policy" at that time. Any additional amount is not taxable.
If a withdrawal is allocable to "investment in the policy" made prior to August
14, 1982, it is taxed under the "cost recovery rule" so that withdrawals are
treated as a recovery of "investment in the policy" until such investment has
been fully recovered. Thereafter, withdrawals are fully taxable as ordinary
income. Where a policy contains "investment in the policy" both before and after
the above referenced dates, special ordering rules apply.
Although the tax consequences may vary depending on the Annuity Income Option
elected under the Policy, in general, only the portion of the Annuity Payment
that represents the amount by which the Accumulation Value exceeds the
"investment in the policy" will be taxed. For fixed annuity payments, in
general, there is no tax on the amount of each payment which represents the same
ratio that the "investment in the policy" bears to the total expected value of
the Annuity Payment for the term of the payment; however, the remainder of each
Annuity Payment is taxable. Any distribution received subsequent to the
investment in the Policy being recovered will be fully taxable.
In the case of a distribution from a Nonqualified Policy, there may be imposed a
federal penalty tax equal to 10% of the amount treated as taxable income. In
general, however, there is no penalty tax on distributions: (1) made on or after
the date on which the Owner is actual age 59 1/2, (2) made as a result of death
or disability of the Owner, (3) received in substantially equal payments as a
life annuity subject to Internal Revenue Service requirements, including special
"recapture" rules, or (4) which are allocable to "investment in the policy" made
prior to August 14, 1982.
NLVA 19
<PAGE>
QUALIFIED POLICIES. The rules governing the tax treatment of distributions under
qualified plans vary according to the type of plan and the terms and conditions
of the plan itself. Generally, in the case of a distribution to a participant or
beneficiary under a Policy purchased in connection with these plans, only the
portion of the payment in excess of the "investment in the policy" allocated to
that payment is subject to tax. The "investment in the policy" equals the
portion of plan contributions invested in the Policy that was not excluded from
the participant's gross income (reduced by any amounts previously received under
the policy which were excluded from gross income), and may be zero. In general,
for allowed withdrawals from qualified policies other than Roth IRAs, a ratable
portion of the amount received is taxable, based on the ratio of the investment
in the Policy to the total Policy value. The amount excluded from a taxpayer's
income will be limited to an aggregate cap equal to the investment in the
Policy. The taxable portion of annuity payments with annuity starting dates on
or before November 18, 1996 is generally determined under rules similar to those
applicable to annuity distributions from Nonqualified Policies. However, for
annuity payments with annuity starting dates after November 18, 1996, annuitants
must use a simplified method for determining the tax-free portion of annuity
payments by dividing "investments in the policy" by the number of annuity
payments set by tables in the Internal Revenue Code based on the age of the
primary annuitant. This method does not apply if the annuitant is over age 75
and there are 5 or more years of guaranteed payments. Also, for annuity payments
based on the lives of more than one individual and that have annuity starting
dates after December 31, 1997, annuitants must use the simplified method based
on the combined ages of both individuals when calculating the excludable portion
of annuities based on the separate tables set forth in the Code for that
purpose. In the case of an annuity that does not depend in whole or in part on
the life expectancy of one or more individuals, the expected number of payments
is the number of monthly annuity payments under the policy. Special favorable
tax treatment may be available for certain distributions (including lump sum
distributions from plans other than IRAs made in tax years beginning before
January 1, 2000). Adverse tax consequences may result from excess contributions,
distributions made prior to age 59 1/2 (subject to certain exceptions),
distributions that do not conform to specified commencement and minimum
distribution rules, and in certain other circumstances.
Roth IRA contributions are not deductible and may be limited depending on your
adjusted gross income. Withdrawals of earnings from Roth IRAs may be tax free if
certain requirements are met. If earnings withdrawals do not meet those
requirements, they will be considered to be made first from contributions and
then from earnings. The earnings will be subject to income tax and an additional
10% penalty tax (or 20% under legislation pending before Congress) may apply.
Conversions from existing IRAs to Roth IRAs are permitted if certain
requirements are met, however, converted amounts not previously taxed will be
subject to income tax in the year of conversion (for 1998 only, the conversion
amount will be taxed on a pro rata basis over 4 years, beginning in 1998).
Legislation pending before Congress may significantly impact the tax treatment
of contributions to, conversions to, and distributions from Roth IRAs.
Distributions from qualified plans are subject to specific tax withholding
rules. "Eligible rollover distributions" from a qualified plan (other than IRAs
of any type and Section 457 plans) are subject to income tax withholding at a
rate of 20% unless the Owner elects to have the distribution paid directly by
Ameritas to an eligible retirement plan (another plan of the same type or a
rollover IRA) in a direct rollover. If the distribution is not an "eligible
rollover distribution," it is generally subject to the same withholding rules as
distributions from Nonqualified Policies. However, Section 457 nonqualified
deferred compensation plan distributions are generally subject to withholding as
wages and are not eligible for rollover to an IRA .
GENERAL PROVISIONS
ANNUITANT'S BENEFICIARY
The Annuitant's Beneficiary(ies) receives the death benefit proceeds upon death
of the Annuitant. The Owner may name both primary and contingent Annuitant's
Beneficiaries. The Annuitant's
20 NLVA
<PAGE>
Beneficiary(ies) is named in the application or as subsequently changed and
recorded in Ameritas' records.
Multiple beneficiaries may be named; however, unless otherwise indicated,
payments are made equally to those primary beneficiaries who are alive upon the
death of the Annuitant. Contingent beneficiaries are only eligible if no primary
beneficiary is alive at the time proceeds are payable. If none survive, the
final beneficiary will be the Owner or the Owner's estate.
The Owner may change the Annuitant's Beneficiary by written request on a Change
of Beneficiary form at any time during the Annuitant's lifetime. Ameritas, at
its option, may require that the Policy be returned to the Home Office for
endorsement of any change, or that other forms be completed. The change will
take effect as of the date the change is recorded at the Home Office. Ameritas
will not be liable for any payment made or action taken before the change is
recorded. No limit is placed on the number of changes that may be made.
DEATH OF ANNUITANT
If the Annuitant dies prior to the Annuity Date, an amount will be paid as
proceeds to the Annuitant's Beneficiary. The death benefit is payable upon
receipt of Satisfactory Proof of Death of the Annuitant as well as proof that
the Annuitant died prior to the Annuity Date. Ameritas guarantees the Death
Benefit will equal the greater of the Accumulation Value or total premiums paid
less withdrawals, on the date Satisfactory Proof of Death is received by
Ameritas at its Home Office. The death benefit is payable as a lump sum or under
one of the Annuity Income Options.
The Owner may elect an Annuity Income Option for the Annuitant's Beneficiary, or
if no such election was made by the Owner and a cash benefit has not been paid,
the Annuitant's Beneficiary may make this election after the Annuitant's Death.
Since Satisfactory Proof of Death includes a "Claimant's Statement", which
specifies how the beneficiary wishes to receive the benefit (unless the Owner
previously selected an option), the amount of the death benefit will continue to
reflect the investment performance of the Separate Account until that
information is supplied to Ameritas. Upon receipt of this proof, the death
benefit will be paid to the Annuitant's Beneficiary within seven days, or as
soon thereafter as Ameritas has sufficient information about the Annuitant's
Beneficiary to make the payment. In order to take advantage of the favorable tax
treatment accorded to receiving the death benefit as an annuity, the Annuitant's
Beneficiary must elect to receive the benefits under an Annuity Option within 60
days "after the day on which such lump sum became payable," as defined in the
Internal Revenue Code.
DEATH OF OWNER
If the Owner dies on or after the Annuity Date, annuity benefits continue to be
paid to the Annuitant under the Annuity Income Option in effect on the Owner's
date of death.
If the Owner dies before the Annuity Date and before the entire interest in the
Policy is distributed, the Accumulation Value of the Policy must be distributed
to the Owner's Designated Beneficiary so that the Policy qualifies as an annuity
under the Internal Revenue Code. The entire interest must be distributed within
five years of the Owner's death. However, a distribution period exceeding five
years will be allowed if the Owner's Designated Beneficiary purchases an
immediate annuity under which payments will begin within one year of the Owner's
death and will be paid out over the lifetime of the Owner's Designated
Beneficiary or over a period not extending beyond his or her life expectancy.
NLVA 21
<PAGE>
If the Owner's interest is payable to (or for the benefit of) the surviving
spouse of the Owner, the Policy may be continued with the surviving spouse
treated as the Owner for purposes of applying the rules described above.
Finally, in situations where the Owner is not an individual, these distribution
rules are applicable upon the death or change of the Annuitant.
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS
Ameritas reserves the right, subject to applicable law, and if necessary, after
notice to and prior approval from the SEC and or state insurance authorities, to
make additional Portfolios available to you. We may also eliminate, combine or
substitute Subaccounts if, in our judgment, marketing needs, tax considerations,
or investment conditions warrant. This may happen due to a change in law or a
change in a Portfolio's investment objectives or restrictions, or for some other
reason. Ameritas may operate the Separate Account as a management company under
the 1940 Act, it may be deregistered under that Act if registration is no longer
required, or it may be combined with other Ameritas separate accounts. Ameritas
may also transfer the assets of the Separate Account to another separate
account.
If any of these substitutions or changes are made, Ameritas may by appropriate
endorsement change the policy to reflect the substitution or change. In
addition, Ameritas may, when permitted by law, restrict or eliminate any voting
rights of Owners or other persons who have voting rights as to the Separate
Account.
You will be notified of any material change in the investment policy of any
Portfolio in which you have an interest.
DEFERMENT OF PAYMENT
Payment of any withdrawal, surrender or lump sum death benefit due from the
Separate Account will occur within seven days from the date the amount becomes
payable, except that Ameritas may be permitted to defer such payment if:
a) the New York Stock Exchange is closed other than customary weekends or
holidays or trading on the New York Stock Exchange is otherwise restricted;
or
b) the SEC permits the delay for the protection of Owners; or
c) an emergency exists as determined by the SEC.
In addition, surrenders or withdrawals from the Fixed Account may be deferred by
Ameritas for up to 6 months from the date of written request.
OWNER INQUIRIES
Inquiries should be addressed to Ameritas Life Insurance Corp., 5900 "O" Street,
P.O. Box 81889, Lincoln, Nebraska 68501 or made by calling 1-800-255-9678. All
inquiries should include the Policy number and the Owner's name.
CONTESTABILITY
Ameritas cannot contest the validity of this Policy after the Policy Date,
subject to the "Misstatement of Age or Sex" provision.
22 NLVA
<PAGE>
MISSTATEMENT OF AGE OR SEX
Ameritas may require proof of age and sex before making annuity payments. If the
age or sex of the Annuitant has been misstated, we will adjust the benefits and
amounts payable under this Policy.
If Ameritas made any overpayments, interest at the rate of 6% per year
compounded yearly will be charged against future payments. If we made
underpayments, the balance due plus interest at the rate of 6% per year
compounded yearly will be paid in a lump sum.
REPORTS AND RECORDS
Ameritas will maintain all records relating to the Separate Account and will
mail the Owner, at the last known address of record, within 30 days after each
Policy anniversary, an annual report which shows the current Accumulation Value
as allocated among the Subaccounts or the Fixed Account, and charges made during
the Policy Year. Quarterly reports are also currently provided but except for
the annual report, Ameritas reserves the right to charge a report fee for each
requested report. The Owner will also be sent confirmations of transactions,
such as purchase payments, transfers and withdrawals under the Policy. Quarterly
statements are also mailed detailing Policy activity during the calendar
quarter. Instead of receiving an immediate confirmation of transactions made
pursuant to some types of periodic payment plan (such as a dollar cost averaging
program, or payment made by automatic bank draft or salary reduction
arrangement), the Owner may receive confirmation of such transactions in their
quarterly statements. The Owner should review the information in these
statements carefully. All errors or corrections must be reported to Ameritas
immediately to assure proper crediting to the Policy. Ameritas will assume all
transactions are accurately reported on quarterly statements unless Ameritas is
otherwise notified within 30 days after receipt of the statement. A periodic
report for the Fund and a list of the securities held in each Portfolio of the
Fund and any other information required by the 1940 Act will also be provided.
DISTRIBUTION OF THE POLICIES
Ameritas Investment Corp. ("AIC"), a wholly owned subsidiary of AMAL
Corporation, and an affiliate of Ameritas, will act as the principal underwriter
of the Policies. AIC was organized under the laws of the State of Nebraska on
December 29, 1983, and is a broker/dealer registered according to the Securities
Exchange Act of 1934 and a member of the National Association of Securities
Dealers, Inc. There is no premium load to cover sales and distribution expenses.
All compensation or expense reimbursement received by AIC for serving as the
principal underwriter of the Policies will be paid by Ameritas from its other
assets or surplus in its general account, which may include profits derived from
amounts derived from mortality and expense risk charges and other charges made
under the Policies. Policies can be purchased directly from Ameritas through
Veritas, Ameritas' wholly owned direct-to-consumer subsidiary, with salaried
employees who are registered representatives of AIC and who will not receive
compensation related to the purchase. The Policies are also sold by individuals
who are registered representatives of AIC, and who are licensed as life
insurance agents for Ameritas. AIC and Ameritas may authorize registered
representatives of other registered broker/dealers to sell the Policies subject
to applicable law. In these situations, AIC or the other broker/dealer may
receive compensation. AIC will be paid by Ameritas at a rate of .05% of all
premium received. Other broker/dealers will receive from Ameritas up to .5% of
premium, and an asset based administrative compensation of .10% (annualized),
which fee shall be paid by Ameritas.
The gross variable annuity compensation received by AIC on Ameritas' variable
annuity policies was $4,677 for 1997, and $0 for 1996 and all prior years.
SAFEKEEPING OF THE SEPARATE ACCOUNT'S ASSETS
Ameritas holds the assets of the Separate Account. The assets are held separate
and apart from General Account assets. Ameritas maintains records of all
purchases and redemptions of the Funds' shares by each of the Subaccounts.
NLVA 23
<PAGE>
THIRD PARTY SERVICES
Ameritas is aware that certain third parties are offering money management
services in connection with the contracts. Ameritas does not engage any such
third parties to offer such services of any type. In certain cases, Ameritas has
agreed to honor transfer instructions from such services where it has received
powers of attorney, in a form acceptable to it, from the contract owners
participating in the service. Firms or persons offering such services do so
independently from any agency relationship they may have with Ameritas for the
sale of contracts. Ameritas takes no responsibility for the investment
allocations and transfers transacted on a contract owner's behalf by such third
parties or any investment allocation recommendations made by such parties.
Contract owners should be aware that fees paid for such services are separate
and in addition to fees paid under the contracts.
VOTING RIGHTS
To the extent required by law, Ameritas will vote the Portfolio shares held in
the Separate Account at shareholder meetings in accordance with instructions
received from persons having voting interests in the corresponding Subaccount.
The 1940 Act currently requires shareholder voting on matters such as the
election of the Board of Trustees of the Funds, the approval of the investment
advisory contract, changes in the fundamental investment Policies of the Funds,
and approval of the independent accountants. If, however, the 1940 Act or any
regulation thereunder should be amended, or if the present interpretation
thereof should change, and, as a result, Ameritas determines that it is allowed
to vote the Portfolio shares in its own right, Ameritas may elect to do so.
Prior to the Annuity Date, the Owner holds a voting interest in each Subaccount
to which the Accumulation Value is allocated. The number of votes available to
an Owner will be calculated separately for each Subaccount of the Separate
Account. The number of votes available to an Owner will be determined by
dividing the Accumulation Value attributable to a Subaccount by the net value
per share of the applicable Portfolio. In determining the number of votes,
fractional shares will be recognized.
The number of votes of the Portfolio which are available will be determined as
of the date coincident with the date established by that Portfolio for
determining shareholders eligible to vote at the meeting of the Funds. Voting
instructions will be solicited by written communication prior to such meeting in
accordance with procedures established by the Funds.
Shares of Funds as to which no timely instructions are received, or shares held
by Ameritas as to which Owners have no beneficial interest will be voted in
proportion to the voting instructions which are received with respect to all
Policies participating in that Subaccount.
Each person having a voting interest in a Subaccount will receive proxy
material, reports and other materials relating to the appropriate Portfolio.
On and after the Annuity Date, there are no voting rights because amounts are no
longer held in the Separate Account.
LEGAL PROCEEDINGS
There are no legal proceedings to which the Separate Account is a party or to
which the assets of the Separate Account are subject. Ameritas is not involved
in any litigation that is of material importance in relation to its ability to
meet its obligations under the Policies, or that relates to the Separate
Account. AIC is not involved in any litigation that is of material importance in
relation to its ability to perform under its underwriting agreement.
24 NLVA
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
A Statement of Additional Information is available that contains more details
concerning the subjects discussed in this Prospectus. This can be obtained by
writing to the address on the front page or by calling 1-800-255-9678.
The following is a Table of Contents for that Statement:
<TABLE>
<CAPTION>
Page
<S> <C>
GENERAL INFORMATION AND HISTORY..................................................... 2
THE POLICY.......................................................................... 2
GENERAL MATTERS..................................................................... 6
FEDERAL TAX MATTERS................................................................. 7
DISTRIBUTION OF THE POLICY.......................................................... 7
SAFEKEEPING OF SEPARATE ACCOUNT ASSETS.............................................. 8
STATE REGULATION.................................................................... 8
LEGAL MATTERS....................................................................... 8
EXPERTS............................................................................. 8
OTHER INFORMATION................................................................... 8
FINANCIAL STATEMENTS................................................................ 8
</TABLE>
NLVA 25
<PAGE>
APPENDIX A
QUALIFIED DISCLOSURES
* Information Statement For:
408(b) IRA Plans
408(k) SEP IRA Plans
408(p) SIMPLE IRA Plans
408A Roth IRA Plans (when available)
* Information Statement For:
401(a) Pension/Profit Sharing Plans
AMERITAS LIFE INSURANCE CORP. LOGO
26 NLVA
<PAGE>
If this annuity is being purchased as a qualified plan as defined under
specified sections of the Internal Revenue Code, as purchaser (owner) or
fiduciary of an Employee Benefit Plan purchasing the annuity, you should
carefully review the Information Statement for your specific plan.
Depending on the type of plan, we are required to provide this disclosure to you
to meet the requirements of the Internal Revenue Service (IRS) and/or the
Employee Retirement Income Security Act of 1974 (ERISA).
Acknowledgment of your receipt of the required disclosure is included within the
application language above your signature.
<TABLE>
<CAPTION>
Table of Contents
<S> <C>
Information Statement
408(b) Individual Retirement Annuity (IRA) Plans
408(k) Simplified Employee Pension (SEP IRA) Plans
408(p) Savings Incentive Match (SIMPLE IRA) Plans (if available)
408 Roth IRA..................................................................................... QD-1
Information Statement
401(a) Pension/Profit Sharing Plans.............................................................. QD-9
</TABLE>
<PAGE>
AMERITAS LIFE INSURANCE CORP. LOGO
INFORMATION STATEMENT
408(B)INDIVIDUAL RETIREMENT ANNUITY (IRA) PLANS
408(K)SIMPLIFIED EMPLOYEE PENSION (SEP IRA) PLANS
408(P)SAVINGS INCENTIVE MATCH (SIMPLE IRA) PLANS
408A ROTH IRA (WHEN AVAILABLE)
- -------------------------------------------------------------------------------
For purchasers of a 408(b) Individual Retirement Annuity (IRA) Plan, 408(k)
Simplified Employee Pension (SEP IRA) Plan, 408(p) Savings Incentive Match
(SIMPLE IRA) Plan or 408A Roth IRA, please review the following:
PART 1. PROCEDURE FOR REVOKING THE IRA PLAN:
After you establish an IRA Plan with Ameritas Life Insurance Corp. (Ameritas),
you are able to revoke your IRA within a limited time and receive a full refund
of the initial premium paid, if any. The period for revocation will not be less
than the legal minimum of seven (7) days following the date your IRA is
established with Ameritas.
To revoke your IRA, you should send a signed and dated written notice to:
Ameritas Life Insurance Corp., Policyholder Service Department, P.O. Box 81889,
Lincoln, NE 68501.
If your IRA contract was delivered to you, the contract should accompany your
notice of revocation. Your notice of revocation will be considered mailed on the
date of the postmark (or certification or registration, if applicable), if sent
by United States mail, properly addressed and by first class postage prepaid.
To obtain further information about the revocation procedure, contact your
Ameritas Representative or call 1-800-745-6665.
PART II. PROVISIONS OF THE IRA LAW:
Ameritas' No Load Variable Annuity (Form 4080), can be used for a Regular IRA, a
Rollover IRA, a Spousal IRA Arrangement, a Simplified Employee Pension Plan (SEP
IRA), for a salary reduction Simplified Employee Pension Plan (SARSEP) or a
SIMPLE IRA. A separate policy must be purchased for each individual under each
plan. In addition, Ameritas' No Load Variable Annuity at some point after
December 31 1997, will be made available for use as a Roth IRA. State income tax
treatment of IRAs varies, so this disclosure only discusses the federal tax
treatment of IRAs. Please disucss state income tax treatment of an IRA with your
tax advisor.
While provisions of the IRA law are similar for all such plans, any major
differences are set forth under the appropriate topics below.
ELIGIBILITY:
REGULAR IRA PLAN: Any individual under age 70 1/2 and earning income from
personal services, is eligible to establish an IRA Plan, although deductibility
of the contributions is determined by adjusted gross income ("AGI") and whether
the individual(or the individual's spouse) is an "active participant" in an
employer sponsored retirement plan.
ROLLOVER IRA: This is an IRA plan purchased with your distributions from
another IRA (including a SEP IRA, SARSEP or SIMPLE IRA), a Section 401(a)
Qualified Retirement Plan, or a Section 403(b) Tax Sheltered Annuity (TSA).
Amounts transferred as Rollover Contributions are not taxable in the year of
distribution (provided the rules for Rollover treatment are satisfied) and may
or may not be subject to withholding. Rollover Contributions are not
deductible.
SPOUSAL IRA ARRANGEMENT: A Spousal IRA, consisting of a separate contract for
each spouse, may be set up provided a joint return is filed, the "nonworking
spouse" has less taxable compensation, if any, for the tax year than the
working spouse, and is under age 70 1/2 at the end of the tax year.
Divorced spouses can continue a spousal IRA or start a Regular IRA based on the
standard IRA eligibility rules. All taxable alimony received by the divorced
spouse under a decree of divorce or separate maintenance is treated as
compensation for purposes of the IRA deduction limit.
ROTH IRAS (WHEN AVAILABLE): A Roth IRA must be designated as such when it is
established.
1. A REGULAR ROTH IRA is a Roth IRA established to receive annual contributions
and/or rollover contributions from other Roth IRAs where no portion of the
rollover is attributable to an IRA other than a Roth IRA.
2. A CONVERSION ROTH IRA is a Roth IRA established to receive rollovers or
conversions from non-Roth IRAs and is limited to such contributions.
Roth IRAs are available beginning in 1998. Unlike Regular IRAs, contributions to
a Roth IRA are not deductible for tax purposes. However, any gain accumulated in
a Roth IRA may be nontaxable, depending upon how and when withdrawals are made.
Eligibility to contribute to a Roth IRA (Regular, Spousal or Conversion) is
subject to income and other limits. Unlike deductible IRAs, if eligible, you may
contribute to a Roth IRA even after age 70 1/2.
QD-1 IRA/SEP/SIMPLE/ROTH
No Load Variable Annuity; 2/98
<PAGE>
3. SPOUSAL ROTH IRA ARRANGEMENT: Beginning in 1998, a Spousal Roth IRA may be
set up for a "non-working" spouse that has less taxable compensation, if
any, for the tax year than the "working" spouse, regardless of age, provided
the spouses file a joint tax return and subject to the adjusted gross income
("AGI") limits described in PART II, MAXIMUM CONTRIBUTIONS - SPOUSAL ROTH
IRA ARRANGEMENT. Divorced spouses can continue a Spousal Roth IRA or start a
Regular Roth IRA based on standard Roth IRA eligibility rules. Taxable
alimony received by the divorced spouse under a decree of divorce or
separate maintenance is treated as compensation for purposes of Roth IRA
eligibility limits.
SIMPLIFIED EMPLOYEE PENSION PLAN (SEP IRA): An employee is eligible to
participate in a SEP IRA Plan based on eligibility requirements set forth in
form 5305-SEP or other plan document provided by the employer.
SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN (SARSEP): An employee is
eligible to participate in a SARSEP plan based on eligibility requirements set
forth in form 5305A-SEP or the plan document provided by the employer. New
SARSEP plans may not be established after December 31, 1996. SARSEPs established
prior to January 1, 1997, may continue to receive contributions after 1996, and
new employees hired after 1996 are also permitted to participate in such plans.
SAVINGS INCENTIVE MATCH PLAN FOR EMPLOYEES OF SMALL EMPLOYERS (SIMPLE IRA): An
employee is eligible to participate in a SIMPLE IRA Plan based on eligibility
requirements set forth in Form 5304-SIMPLE or other plan document provided by
the employer.
NONTRANSFERABILITY: You may not transfer, assign or sell your IRA Plan
(including a SIMPLE IRA, SEP IRA, SARSEP or Roth IRA) to anyone (except in the
case of transfer incident to divorce).
NONFORFEITABILITY: The value of your IRA Plan (all types included) belongs to
you at all times, without risk of forfeiture.
PREMIUM: The annual premium (if applicable) of your IRA Plan or Roth IRA may not
exceed the lesser of $2,000, or 100% of compensation for the year (or for
Spousal IRAs, or Spousal Roth IRAs, the combined compensation of the spouses
reduced by any Roth IRA or deductible IRA contribution made by the "working"
spouse). Any premium in excess of or in addition to $2,000 will be permitted
only as a "Rollover Contribution" (or "Conversion" contribution to a Roth IRA).
Your contribution must be made in cash. For IRAs established under SEP Plans
(SEP IRAs), premiums are limited to the lesser of $30,000 or 15% of the first
$150,000 of compensation (adjusted for cost of living increases). In addition,
if the IRA is under a SARSEP established prior to January 1, 1997, annual
premiums made by salary reduction are limited to $7,000 (adjusted for cost of
living increases). Premiums under a SIMPLE IRA will be limited to permissible
levels of annual employee elective contributions (up to $6,000 adjusted for cost
of living increases) plus the applicable percentage of employer matching
contributions (up to 3% of compensation but not in excess of $6,000, as
adjusted) or of employer non-elective contributions (2% of compensation (subject
to the cap under Code Section 401(a)(17) as indexed) for each eligible
employee).
MAXIMUM CONTRIBUTIONS:
REGULAR IRA PLAN: In any year that your annuity is maintained under the rules
for a Regular IRA Plan, your maximum contribution is limited to 100% of your
compensation or $2,000, whichever is less. Further, this is the maximum amount
you may contribute to ALL IRAs in a year (including Roth IRAs, but not SIMPLE
IRAs or Education IRAs). The amount of permissible contributions to your Regular
IRA may or may not be deductible. Whether IRA contributions (other than
Rollovers) are deductible depends on whether you (or your spouse, if married)
are an active participant in an employer-sponsored retirement plan and whether
your adjusted gross income ("AGI") is above the "phase-out level." Beginning for
tax years after 1997, you will only be deemed to be an active participant
because of your spouse's participation in an employer- sponsored plan, if your
combined adjusted gross income exceeds $150,000. SEE PART III, DEDUCTIBLE IRA
CONTRIBUTIONS.
ROLLOVER IRA: A Plan to Plan Rollover is a method for accomplishing continued
tax deferral on otherwise taxable distributions from certain plans. Rollover
contributions are not subject to the contribution limits on Regular IRA
contributions, but also are not tax deductible.
There are two ways to make a rollover to an IRA:
(1) PARTICIPANT ROLLOVERS are available to participants, surviving spouses
or former spouses who receive eligible rollover distributions from
401(a) Qualified Retirement Plans, TSAs or IRAs (including SEPs,
SARSEPs, and SIMPLE IRAs). Participant Rollovers are accomplished by
contributing part or all of the eligible amounts (which includes
amounts withheld for federal income tax purposes) to your new IRA
within 60 days following receipt of the distribution. IRA to IRA
Rollovers are limited to one per distributing plan per 12 month
period, while direct IRA to IRA transfers (where you do not directly
receive a distribution) are not subject to this limitation.
Distributions from a SIMPLE IRA may not be rolled over or transferred
to an IRA (which isn't a SIMPLE IRA) during the 2 year period
following the date you first participate in any SIMPLE Plan maintained
by your employer.
(2) DIRECT ROLLOVERS are available to participants, surviving spouses and
former spouses who receive eligible rollover distributions from 401(a)
Qualified Retirement Plans or TSAs. Direct Rollovers are made by
instructing the plan trustee, custodian or issuer to pay the eligible
portion of your distribution directly to the trustee, custodian or
issuer of the receiving IRA. Direct Rollover amounts are not subject
to mandatory federal income tax withholding.
FOR RULES APPLICABLE TO ROLLOVERS OR TRANSFERS TO ROTH IRAS, SEE THE
PARAGRAPHS ON REGULAR AND CONVERSION ROTH IRAS, BELOW.
Certain distributions are NOT considered to be eligible for Rollover and
include: (1) distributions which are part of a series of substantially equal
periodic payments (made at least annually) for 10 years or more; (2)
distributions attributable to after-tax employee contributions to a 401(a)
Qualified Retirement Plan or TSA; (3) required minimum distributions made during
or after the year you reach age 70 1/2 or, if later and applicable, the year in
which you retire; and (4) amounts in excess of the cash (except for certain loan
offset amounts) or in excess of the proceeds from the sale of property
distributed.
IRA/SEP/SIMPLE/ROTH QD-2
No-Load Variable Annuity; 2/98
<PAGE>
At the time of a Rollover, you must irrevocably designate in writing that the
transfer is to be treated as a Rollover Contribution. Eligible amounts which are
not rolled over are normally taxed as ordinary income in the year of
distribution. If a Rollover Contribution is made to an IRA from a Qualified
Retirement Plan, you may later be able to roll the value of the IRA into a new
employer's plan PROVIDED YOU MAKE NO CONTRIBUTIONS TO THE IRA OTHER THAN FROM
THE FIRST EMPLOYER'S PLAN. THIS IS KNOWN AS "CONDUIT IRA," AND YOU SHOULD
DESIGNATE YOUR ANNUITY AS SUCH WHEN YOU COMPLETE YOUR APPLICATION.
SPOUSAL IRA ARRANGEMENT: In any year that your annuity is maintained under the
rules for a Spousal IRA, the maximum combined contribution to the Spousal IRA
and the "working" spouse's IRA for tax years after 1996, is the lesser of 100%
of the combined compensation of both spouses which is includable in gross income
(reduced by the amount of any contributions to a Roth IRA or the amount allowed
as a deduction to the "working" spouse for contribution to his or her own IRA)
or $4,000. No more than $2,000 may be contributed to either spouse's IRA.
Whether the contribution is deductible or non-deductible depends on whether
either spouse is an "active participant" in an employer-sponsored retirement
plan for the year, and whether the adjusted gross income of the couple is above
the applicable phase-out level. (SEE PART III, DEDUCTIBLE IRA CONTRIBUTIONS).
The contribution limit for divorced spouses is the lesser of $2,000 or the total
of the taxpayer's taxable compensation and alimony received for the year.
(Married individuals who live apart for the entire year and who file separate
tax returns are treated as if they are single when determining the maximum
deductible contribution limits).
REGULAR ROTH IRA (WHEN AVAILABLE): The maximum total annual contribution an
individual can make to all IRAs (including Roth IRAs, but not Education or
SIMPLE IRAs) is the lesser of $2,000 or 100% of compensation. (This limit does
not apply to rollover contributions). For Regular Roth IRAs (which are available
beginning in the 1998 tax year) this $2,000 limitation is phased out for
adjusted gross incomes between $150,000 and $160,000 for joint filers; between
$95,000 and $110,000 for single taxpayers; and between $0 and $15,000 for
married individuals who file a separate return. AGI for this purpose includes
any deductible contribution to a Regular IRA, but does not include any amount
included in income as a result of a rollover or conversion from a non-Roth IRA
to a Conversion Roth IRA. Rollovers and transfers may also be made from one
Regular Roth IRA to another. Such rollovers or transfers are generally subject
to the same timing and frequency rules as apply to Participant Rollovers and
transfers from one Regular or Rollover IRA to another. (SEE PART II, MAXIMUM
CONTRIBUTIONS: ROLLOVER IRA, ABOVE).
CONVERSION ROTH IRA (WHEN AVAILABLE): Beginning in the 1998 tax year, rollovers
or conversions may be made from non-Roth IRAs to a Conversion Roth IRA. To be
eligible to make such a conversion or rollover from a non-Roth IRA, the
taxpayer's adjusted gross income ("AGI") for the taxable year cannot exceed
$100,000 (joint or individual) and he or she must not be married filing a
separate tax return (unless the taxpayer lives apart from his of her spouse at
all times during the year). A rollover from a non-Roth IRA to a Conversion Roth
IRA does not count toward the limit of one rollover per IRA in any 12-month
period under the normal rollover rules. Also, eligible rollover distributions
received by you or your spouse from a qualified plan other than an IRA, may not
be directly rolled over to a Roth IRA. However, you may be able to roll such a
distribution over to a non-Roth IRA, then convert that IRA to a Conversion Roth
IRA. Also if you are eligible to make a conversion, you may transfer amounts
from most non-Roth IRAs (other than SIMPLE IRAs and Education IRAs). AGI for the
purpose of determining eligibility to convert to a Roth IRA does not include any
amount included in income as a result of a rollover or conversion from a
non-Roth IRA to a Conversion IRA, but does include the amount of any deductible
contribution made to a Regular IRA for the tax year.
SPOUSAL ROTH IRA ARRANGEMENT: Beginning in the 1998 tax year, if the
"non-working" spouse's compensation is less than $2,000, the spouses file a
joint tax return, and their combined AGI (unreduced by any deductible IRA
contribution made for the year, but not including any amounts includible in
income as a result of a conversion to a Roth IRA) is $150,000 or below, a
contribution of up to $2,000 may be made to a separate Spousal Roth IRA in the
name of the "non-working" spouse. The $2,000 limit is phased out proportionately
between $150,000 and $160,000 of AGI (modified as described above). Spouses are
not required to make equal contributions to both Roth IRAs; however no more than
$2,000 may be contributed to the "working" or "non-working" spouse's Roth IRA
for any year, and the total amount contributed annually to all IRAs (including
both Roth and Regular IRAs, but not SIMPLE or Education IRAs) for both spouses
cannot exceed $4,000. If the combined compensation of both spouses (reduced by
any deductible IRA or Roth contributions made for the "working" spouse) is less
than $4,000, the total contribution for all IRAs is limited to the total amount
of the spouses' combined compensation. These limits do not apply to rollover
contributions.
For divorced spouses, the contribution limit to a Roth IRA is the lesser of
$2,000 or the total of the taxpayer's compensation and alimony received for the
year, subject to the applicable phase-out limits for eligibility to make
contributions to a Roth IRA. (Married individuals who live apart for the entire
year and who file separate tax returns are treated as if they are single when
determining the maximum contribution they are eligible to make in a Roth IRA).
SEP IRA PLAN: In any year that your annuity is maintained under the rules for a
SEP Plan, the employer's maximum contribution is the lesser of $30,000 or 15% of
your first $150,000 of compensation (adjusted for cost-of-living increases) or
as changed under Section 415 of the Code. You may also be able to make
contributions to your SEP IRA the same as you do to a Regular IRA; however, you
will be considered an "active participant" for purposes of determining your
deduction limit. In addition to the above limits, if your annuity is maintained
under the rules for a SARSEP, the maximum amount of employee pre-tax
contributions which can be made is $7,000 (adjusted for cost of living
increases). After December 31, 1996, new SARSEP plans may not be established.
Employees may, however, continue to make salary reductions to a SARSEP plan
established prior to January 1, 1997. In addition, employees hired after
December 31, 1996 may participate in SARSEP plans established by their employers
prior to 1997.
SIMPLE IRA: Contributions to a SIMPLE IRA may not exceed the permissible amounts
of employee elective contributions and required employer matching contributions
or non-elective contributions. Annual employee elective contributions must be
expressed as a percentage of compensation and may not exceed $6,000 (adjusted
for cost of living increases). If an employer elects a matching contribution
formula, it is generally required to match employee contributions dollar for
dollar up to 3% of the employee's compensation for the year (but not in excess
of $6,000 as adjusted for cost-of-living adjustments). An employer may elect a
lower percentage match (but not below 1%) for a year, provided certain notice
requirements are satisfied and the employer's election will not result in the
matching percentage being lower than 3% in more than 2 of the 5 years in the
5-year period ending with that calendar year. Alternatively, an employer may
elect to make non-elective contributions of 2% of compensation for all employees
eligible to participate in the plan and who have at least $5,000 in compensation
for the year. The employer must notify employees of this election within
specified timeframes in advance of the plan year or election period.
"Compensation" for purposes of the 2% nonelective contribution option may not
exceed the limit on compensation under Code Section 401(a)(17) ($150,000,
adjusted for cost of living increases).
QD-3 IRA/SEP/SIMPLE/ROTH
No Load Variable Annuity; 2/98
<PAGE>
DISTRIBUTIONS: Payments to you from your IRA Plan (other than a Roth IRA) must
begin no later than the April 1 following the close of the calendar year in
which you attain age 70 1/2, the Required Beginning Date (RBD). If you have not
already withdrawn your entire balance by this date, you may elect to receive the
entire value of your IRA Plan on or before the RBD in one lump sum; or arrange
for an income to be paid over your lifetime, your expected lifetime, or over the
lifetimes or expected lifetimes of you and your designated beneficiary. UNDER A
ROTH IRA, YOU ARE NOT REQUIRED TO TAKE DISTRIBUTIONS WHILE YOU ARE LIVING, EVEN
AFTER YOU REACH AGE 70 1/2.
RATE OF DISTRIBUTION: If you arrange for the value of your IRA Plan (other than
a Roth IRA) to be paid to you as retirement income rather than as one lump sum,
then you must abide by IRS rules governing how quickly the value of your IRA
plan must be paid out to you. Generally, it is acceptable to have an insurance
company annuity pay income to you for as long as you live, or for as long as you
and your beneficiary live.
MINIMUM DISTRIBUTION REQUIREMENTS FOR IRAS OTHER THAN ROTH IRAS : Once you reach
your RBD, you must withdraw a minimum amount each year or be subject to a 50%
non-deductible excise tax on the difference between the minimum required
distribution and the amount distributed. To determine the required minimum
distribution, divide your entire interest in your IRA (as of December 31 of your
age 70 1/2 year) by your life expectancy or the joint life expectancies of you
and your designated beneficiary. Your single or joint life expectancy is
determined by using IRS life expectancy tables. See IRS Publications 575 and
590.
Your life expectancy (and that of your spousal beneficiary, if applicable) will
be recalculated annually, unless you irrevocably elect otherwise by the time
distributions are required to begin. With the recalculation method, if a person
whose life expectancy is recalculated dies, his or her life expectancy will be
zero in all subsequent years. The life expectancy of a non-spouse beneficiary
cannot be recalculated. Where life expectancy is not recalculated, it is reduced
by one year for each year after your 70 1/2 year to determine the applicable
remaining life expectancy. Also, if your benefit is payable in the form of a
joint and survivor annuity, a larger minimum distribution amount may be required
under IRS regulations, unless your spouse is the designated beneficiary.
If you die after the RBD, amounts undistributed at your death must be
distributed at least as rapidly as under the method being used to determine
distributions at the time of your death. If you die before the RBD, your entire
interest must generally be distributed by the end of the calendar year which
contains the fifth anniversary of your death (the "five year payout rule").
However, if a beneficiary is designated, the beneficiary may elect to receive
distributions over the life expectancy of the beneficiary if the beneficiary so
elects by December 31 of the year following the year of your death. If the
beneficiary fails to make an election, the entire benefit will be paid to the
beneficiary under the "five year payout rule". Also, if the designated
beneficiary is your spouse, the life annuity distribution must begin by the
later of December 31 of the calendar year following the calendar year of your
death or December 31 of the year in which you would have attained age 70 1/2. If
your designated beneficiary is not your spouse, life annuity distributions must
begin by December 31 of the year following your death. A surviving spouse may in
the alternative elect to treat the policy as his or her own IRA. This election
may be expressly made or will be deemed made if the spouse makes a regular IRA
contribution to the policy, makes a rollover to or from the IRA, or fails to
elect minimum distributions as described above.
ROTH IRA MINIMUM DISTRIBUTION REQUIREMENTS WHILE YOU ARE LIVING. As long as you
are alive, you are not required to take distributions from a Roth IRA, even
after you reach age 70 1/2.
ROTH IRA MINIMUM DISTRIBUTION REQUIREMENTS AFTER YOUR DEATH. Minimum
distribution requirements apply to Roth IRAs only after you die. If you die
after you have reached your Annuity Date, and have begun to receive
distributions under an annuity option (not including an interest only option),
the remaining portion of your policy interests will continue to be distributed
to your designated beneficiary at least as rapidly as under the method being
used prior to your death (provided such method satisfies the requirements of
Code Section 408(b)(3), as modified by Code Section 408A(c)(5).
If you die before the Annuity Date or before distribution of your entire
interest in the policy has been made or begun, your entire interest in your Roth
IRA must be distributed by the end of the calendar year which contains the fifth
anniversary of your death (the "five year payout rule"). However, if there is a
designated beneficiary, he or she may elect to receive distributions over his or
her life expectancy provided the election is made and distributions commence by
December 31 of the year following the year of your death. If the beneficiary
does not make this election, the entire benefit will be paid to him or her under
the "five year payout rule". If your designated beneficiary is your surviving
spouse, he or she may elect to delay distributions until the later of the end of
the calendar year following the year in which you died or the end of the year in
which you would have reach age 70 1/2. If your sole designated beneficiary is
your surviving spouse, he or she may elect to treat the policy as his or her own
Roth IRA by making an express election to do so, by making a regular Roth IRA
contribution or rollover contribution (as applicable or as permissible) to the
policy, or by failing to elect minimum distributions under the "five year payout
rule" or the life annuity options discussed above.
Life expectancies will be determined by using IRS life expectancy tables. A
surviving spouse's life expectancy will be recalculated annually, unless he or
she irrevocably elects otherwise. Non-spousal beneficiary life expectancies will
be determined using the beneficiary's attained age in the calendar year
distributions are required to begin and reducing life expectancy by one for each
year thereafter.
TAKING REQUIRED MINIMUM DISTRIBUTIONS FROM ONE IRA: If you are required to take
minimum distributions from more than one IRA (either as owner of one or more
Regular IRAs and/or as a beneficiary of one or more decedent's Roth IRAs or
Regular IRAs), you may not have to take a minimum distribution from each IRA.
(Regular and Roth IRAs are treated as different types of IRAs, so minimum
distributions from a Roth IRA will not satisfy the minimum distributions
required from a Regular IRA). Instead, you may be able to calculate the minimum
distribution amount required for each IRA (considered to be of the same type)
separately, add the relevant amounts and take the total required amount from one
IRA or Roth IRA (as applicable). Because of this, AVLIC cannot monitor the
required distribution amounts from AVLIC IRAs. Please check with your tax
advisor to verify that you are receiving the proper amount from all of your
IRAs.
PART III. RESTRICTIONS AND TAX CONSIDERATIONS:
TIMING OF CONTRIBUTIONS: Once you establish an IRA, (including a Regular Roth or
Spousal Roth IRA) contributions must be made by the due date, not including
extensions, for filing your tax return. (Participant Rollovers must be made
within 60 days of your receipt of the distribution.) A CONTRIBUTION MADE BETWEEN
JANUARY 1 AND THE FILING DUE DATE FOR YOUR RETURN, MUST BE SUBMITTED
IRA/SEP/SIMPLE/ROTH QD-4
No Load Variable Annuity; 2/98
<PAGE>
WITH WRITTEN DIRECTION THAT IT IS BEING MADE FOR THE PRIOR PLAN YEAR OR IT WILL
BE TREATED AS MADE FOR THE CURRENT TAX YEAR. SEP IRA contributions must be made
by the due date of the Employer's tax return (including extensions). SIMPLE IRA
contributions, if permitted, must be made by the tax return due date for the
employer (including extensions) for the year for which the contribution is made.
Note, an employer is required to make SIMPLE plan contributions attributable to
employee elective contributions as soon as it is administratively feasible to
segregate these contributions from the employer's general assets, but in no
event later than the 30th day of the month following the month in which the
amounts would have otherwise been payable to the employee in cash.
TIMING OF ROTH IRA CONVERSIONS: Conversions from a non-Roth IRA to a Conversion
Roth IRA for a tax year, MUST BE MADE BY DECEMBER 31 OF THAT YEAR. You DO NOT
have until the due date of your tax return for a year to convert a Regular IRA
to a Conversion Roth IRA for that tax year. For example, if you wish to convert
a Regular IRA to a Conversion Roth IRA in 1998, the conversion must be completed
by December 31, 1998, even though your tax return for 1998 may not be due until
April 15, 1999.
DEDUCTIBLE IRA CONTRIBUTIONS: The amount of permissible contributions to your
Regular IRA may or may not be deductible. FOR TAX YEARS BEGINNING BEFORE JANUARY
1, 1998, if you or your spouse are not active participants in an employer
sponsored retirement plan, any permissible contribution you make to your IRA
will be deductible. If you or your spouse are an active participant in an
employer-sponsored retirement plan, the size of your deduction if any, will
depend on your combined adjusted gross income (AGI). If your combined AGI is
less than $40,000, and you file a joint tax return you can deduct your entire
contribution. If you are single and your AGI is less than $25,000, you may also
take a full deduction. For married couples filing joint returns, the deduction
is phased out between $40,000 and $50,000. For single individuals, the deduction
is phased out between $25,000 and $35,000. If you are married and covered by an
employer plan, but file a separate tax return from your spouse, your deduction
is phased out between $0 and $10,000 of AGI. If your AGI is not above the
applicable phase out level, a minimum contribution of $200 is permitted
regardless of whether the phase out rules provide for a lesser amount.
FOR TAX YEARS BEGINNING ON AND AFTER JANUARY 1, 1998, if you or your spouse are
not an active participant in an employer sponsored retirement plan, any
permissible contribution you make to your IRA (other than a Roth IRA) will be
deductible. If you are not an active participant in an employer sponsored plan,
but your spouse is an active participant, you may take a full deduction for your
IRA contribution (other than to a Roth IRA) if your AGI is below $150,000; if
you are not an active participant but your spouse is, the maximum deductible
contribution for you is phased out at AGIs between $150,000 and $160,000. If you
are an active participant in an employer sponsored requirement plan you may make
deductible contributions if your AGI is below a threshold level of income. For
single taxpayers and married taxpayers filing jointly the available deduction is
reduced proportionately over a phaseout range. Active participants with income
above the phaseout range are not entitled to an IRA deduction. Due to changes
made by the Taxpayer Relief Act of 1997, the phaseout limits are scheduled to
increase as follows:
<TABLE>
<CAPTION>
Married filing Single/Head
Year Jointly of Household
- ------------------------------------------------------------------------------------------------------------
AGI AGI
<S> <C> <C> <C> <C>
1998.......................................$50,000 - $60,000..................................$30,000 - $40,000
1999.......................................$51,000 - $61,000..................................$31,000 - $41,000
2000.......................................$52,000 - $62,000..................................$32,000 - $42,000
2001.......................................$53,000 - $63,000..................................$33,000 - $43,000
2002.......................................$54,000 - $64,000..................................$34,000 - $44,000
2003.......................................$60,000 - $70,000..................................$40,000 - $50,000
2004.......................................$65,000 - $75,000..................................$45,000 - $55,000
2005.......................................$70,000 - $80,000..................................$50,000 - $60,000
2006.......................................$75,000 - $85,000..................................$50,000 - $60,000
2007 and thereafter........................$80,000 - $100,000.................................$50,000 - $60,000
</TABLE>
You can elect to treat deductible contributions as non-deductible. SEP IRA,
SARSEP SIMPLE IRA and Roth IRA contributions are not deductible by you.
Remember, except for rollovers, conversions or transfers, the maximum amount you
may contribute to all IRAs (including Roth and Regular IRAs, but not SIMPLE IRAs
or Education IRAs) for a calendar year is $2,000 or 100% of compensation,
whichever is less.
NON-DEDUCTIBLE REGULAR IRA CONTRIBUTIONS: It is possible for you to make
non-deductible contributions to your Regular IRA (not including SIMPLE IRAs)
even if you are not eligible to make deductible contributions to a Regular IRA
or non-deductible contributions to a Roth IRA for the year. The amount of
non-deductible contributions you can make depends on the amount of deductible
contributions you make. The sum of your non-deductible and deductible
contributions for a year may not exceed the lesser of (1) $2,000 ($4,000
combined when a Spousal IRA is also involved), or (2) 100% of your compensation
(or, if a Spousal IRA is involved, 100% of you and your spouse's combined
compensation, reduced by the amount of any deductible IRA contribution and
non-deductible Roth IRA contribution made by the "working" spouse). For plan
years beginning on and after January 1, 1998, the sum of your annual
non-deductible (including Roth IRA) and deductible contributions, other than
when combined with a Spousal IRA or Spousal Roth IRA, may not exceed $2,000. IF
YOU WISH TO MAKE A NON-DEDUCTIBLE CONTRIBUTION, YOU MUST REPORT THIS ON YOUR TAX
RETURN BY FILING FORM 8606 (NON-DEDUCTIBLE IRA). REMEMBER, YOU ARE REQUIRED TO
KEEP TRACK OF YOUR NON-DEDUCTIBLE CONTRIBUTIONS AS AVLIC DOES NOT KEEP A RECORD
OF THESE FOR YOU. THIS INFORMATION WILL BE NECESSARY TO DOCUMENT THAT THE
CONTRIBUTIONS WERE MADE ON A NON-DEDUCTIBLE BASIS AND THEREFORE, ARE NOT TAXABLE
UPON DISTRIBUTION.
EFFECTS OF CONVERSION OF REGULAR IRA TO ROTH IRA: If you convert all or part of
a non-Roth IRA to a Conversion Roth IRA, the amount taken out of the non-Roth
IRA will be taxable as if it had been distributed to you in the year of
conversion. If you made non-deductible contributions to any Regular IRA, part of
the amount taken out of a Regular IRA for conversion will be taxable and part
will be non-taxable. (Use IRS Form 8606 to determine how much of the withdrawal
from your Regular IRA is taxable and how much is non-taxable). The taxable
portion of the amount converted is includable in your income for the year of
conversion. However, if the conversion takes place in 1998, one quarter of the
taxable amount will be includable in your income in 1998 and in each of the next
three years.
QD-5 IRA/SEP/SIMPLE/ROTH
No Load Variable Annuity; 2/98
<PAGE>
Amounts properly converted from a non-Roth IRA to a Roth IRA are not subject to
the 10% early withdrawal penalty. However, if you make a conversion to a Roth
IRA, but keep part of the money for any reason, that amount will be taxable in
the year distributed from the non-Roth IRA and the taxable portion may be
subject to the 10% early withdrawal penalty.
Roth IRAs are new and a number of ambiguities exist in the law. Also, at the
time of drafting of this Information Statement, there is pending legislation
which could dramatically change the tax treatment of conversions to and
distributions from Roth IRAs retroactive to January 1, 1998. This Information
Statement is based on AVLIC's interpretation of the law as it exists at the time
of drafting. You should consult with your tax advisor to ensure that you receive
the tax benefits you desire before you contribute to a Roth IRA, convert a
non-Roth IRA to a Conversion Roth IRA or take distributions from a Roth IRA.
EXCESS CONTRIBUTIONS: There is a 6% IRS penalty tax on IRA contributions made in
excess of permissible contributions. However, excess contributions made in one
year may be applied against the contribution limits in a later year if the
contributions in the later year are less than the limit. This penalty tax can be
avoided if the excess amount, together with any earnings on it, is returned to
you before the due date of your tax return for the year for which the excess
amount was contributed. Any earnings so distributed will be taxable in the year
for which the contribution was made and may be subject to the 10% premature
distribution penalty tax (SEE PART III, PREMATURE IRA DISTRIBUTIONS). The 6%
excess contribution penalty tax will apply to each year the excess amount
remains in the IRA Plan, until it is removed either by having it returned to you
or by making a reduced contribution in a subsequent year. To the extent an
excess contribution is absorbed in a subsequent year by contributing less than
the maximum deduction allowable for that year, the amount absorbed will be
deductible in the year applied (provided you are eligible to take a deduction).
If a taxpayer transfers amounts contributed for a tax year to a Regular IRA (and
any earnings allocated to such amounts) to a Roth IRA by the due date for filing
the return for such tax year (not including extensions), the amounts are not
included in the taxpayer's gross income to the extent that no deduction was
allowed for the contribution.
EXCESS CONTRIBUTIONS TO A CONVERSION ROTH IRA: If you are ineligible and convert
a Regular IRA to a Conversion Roth IRA, all or a part of the amount you convert
may be an excess contribution. (Examples may include conversions made when your
Roth AGI exceeds $100,000 or because you fail to timely make the rollover
contribution from the Regular IRA to the Conversion Roth IRA). You will have an
excess contribution if the ineligible amounts you convert and the contributions
you make to all your IRAs for the tax year exceed your IRA contribution limits
for the year. To avoid the 6% excise tax on excess contributions, you must
withdraw the excess contributions plus earnings before the due date of your tax
return.
In addition, an ineligible conversion may have other significant tax
consequences to the extent conversion amounts are treated as excess
contributions. First, distributions from the Regular IRA will not be eligible
for the special tax treatment which applies to conversions. For example, if an
ineligible conversion is made in 1998, the amounts ineligible for conversion
will not be eligible to be spread over four years for income tax purposes and to
the extent taxable, may be subject to the 10% premature distribution penalty.
Second, even though you must remove the excess contributions from the Roth
Conversion IRA, you may not be able to return these amounts to your Regular IRA.
Therefore, you may lose future tax-deferred growth on amounts you incorrectly
convert.
LOANS AND PROHIBITED TRANSACTIONS: You may not borrow from your IRA Plan
(including Roth IRAs) or pledge it as security for a loan. This would disqualify
your entire IRA Plan, and its full value(or taxable portions of your Roth IRA or
non-deductible Regular IRA) would be includable in your taxable income in the
year of violation. This amount would also be subject to the 10% penalty tax on
premature distributions. Your IRA Plan will similarly be disqualified if you or
your beneficiary engage in any transaction prohibited by Section 4975 of the
Internal Revenue Code.
TAXABILITY OF REGULAR IRA DISTRIBUTIONS: Any cash distribution from your IRA
Plan, other than a Roth IRA, is normally taxable as ordinary income. All IRAs of
an individual are treated as one contract. All distributions during a taxable
year are treated as one distribution; and the value of the contract, income on
the contract, and investment in the contract is computed as of the close of the
calendar year with or within which the taxable year ends. If an individual
withdraws an amount from an IRA during a taxable year and the individual has
previously made both deductible and non-deductible IRA contributions, the amount
excludable from income for the taxable year is the portion of the amount
withdrawn which bears the same ratio to the amount withdrawn for the taxable
year as the individual's aggregate non-deductible IRA contributions bear to the
balance of all IRAs of the individual.
TAXABILITY OF ROTH IRA DISTRIBUTIONS: "Qualified distributions" from a Roth IRA
are not included in the taxpayer's gross income and are not subject to the
additional ten percent (10%) early withdrawal penalty tax. To be a "qualified
distribution," the distribution must satisfy a five-year holding period and meet
one of the following four requirements: (1) be made on or after the date on
which the individual attains age 59 1/2; (2) be made to a beneficiary or the
individual's estate on or after the individual's death; (3) be attributable to
the individual being disabled; or (4) be a distribution to pay for a "qualified"
first-time home purchase (up to a lifetime limit of $10,000). In the case of a
rollover or conversion from a Regular IRA to a Conversion Roth IRA, the
five-year holding period for escaping inclusion in income begins with the first
day of the tax year in which the most recent rollover or conversion contribution
is made to the Conversion Roth IRA. For a Regular Roth IRA, the five-year
holding period begins with the first day of the year you made any contributions
to a Regular Roth IRA.
If a distribution from a Roth IRA is not a qualified distribution and it
includes earnings, the earnings distributed are includable in taxable income and
may be subject to the 10% premature distribution penalty. (SEE PART III,
PREMATURE IRA DISTRIBUTIONS).
Unlike Regular IRAs, distributions from Roth IRAs come first from contributions
and converted amounts and last from earnings. Generally, all Roth IRAs (both
Regular Roth IRAs and Conversion Roth IRAs) must be treated as one for purposes
of determining the taxation of distributions. However, in some circumstances,
one or more Roth IRAs may have to be treated separately.
You should be aware that Congress has before it legislation that would
substantially revise these rules. To ensure that you receive the tax result you
desire, you should consult with your tax advisor before taking a distribution
from a Roth IRA.
LUMP SUM DISTRIBUTION: If you decide to receive the entire value of your IRA
Plan in one lump sum, the full amount is taxable when received (except as to
non-deductible contributions or "qualified distributions" from a Roth IRA), and
is not eligible for the special tax rules on lump sum distributions which are
used with other types of Qualified Retirement Plans.
IRA/SEP/SIMPLE/ROTH QD-6
No Load Variable Annuity; 2/98
<PAGE>
PREMATURE IRA DISTRIBUTIONS: There is a 10% penalty tax on taxable amounts
distributed from your IRA (including the taxable portion of any non-qualified
distributions from a Roth IRA) prior to the attainment of age 59 1/2, except
for: (1) distributions made to a beneficiary on or after the owner's death; (2)
distributions attributable to the owner's being disabled as defined in Code
Section 72(m)(7); (3) distributions that are part of a series of substantially
equal periodic payments (made at least annually) for the life of the annuitant
or the joint lives of the annuitant and his or her beneficiary; (4)
distributions made on or after January 1, 1997 for medical expenses which exceed
7.5% of the annuitant's adjusted gross income; (5) distributions made on or
after January 1, 1997, to purchase health insurance for the individual and/or
his or her spouse and dependents if he or she: (a) has received unemployment
compensation for 12 consecutive weeks or more; (b) the distributions are made
during the tax year that the unemployment compensation is paid or the following
tax year; and (c) the individual has not been re-employed for 60 days or more;
(6) distributions made on or after January 1, 1998 for certain qualified higher
education expenses of the taxpayer, the taxpayer's spouse, or any child or
grandchild of the taxpayer or the taxpayer's spouse; or (7) qualified first-time
home buyer distributions made on or after January 1, 1998 (up to a lifetime
maximum of $10,000) used within 120 days of withdrawal to buy, build or rebuild
a first home that is the principal residence of the individual, his or her
spouse, or any child, grandchild, or ancestor of the individual or spouse. The
part of a distribution attributable to non-deductible contributions is not
includable in income and is not subject to the 10% penalty. In addition,
distributions from a SIMPLE Plan during the two-year period beginning on the
date the employee first participated in the employer's SIMPLE Plan will be
subject to a 25% (rather than 10%) premature distribution penalty tax.
Distributions from a Roth IRA made before the expiration of the applicable 5
year holding period (SEE TAXABILITY OF ROTH IRA DISTRIBUTIONS) are not treated
as qualified distributions and are subject to the 10% penalty tax to the extent
they are includable in taxable income.
MINIMUM REQUIRED DISTRIBUTIONS: SEE PART II, MINIMUM DISTRIBUTIONS FOR IRAS
OTHER THAN ROTH IRAS and ROTH IRA MINIMUM DISTRIBUTION REQUIREMENTS. If a
minimum distribution is not made from your IRA (including a Roth IRA) for a tax
year in which it is required, the excess, in any taxable year, of the amount
that should have been distributed over the amount that was actually distributed
is subject to an excise tax of 50%.
GIFT AND ESTATE TAX CONSEQUENCES: The designation of a beneficiary to receive
funds from a Regular or a Roth IRA is not considered a transfer subject to
federal gift taxes. However, funds remaining in your IRA (Regular or Roth) at
the time of your death are includable in your federal gross estate for tax
purposes.
MAXIMUM DISTRIBUTIONS: The Taxpayer Relief Act of 1997 repealed both the 15%
excess accumulation estate tax and excess distribution excise tax which
previously applied to excess retirement plan accumulations at death and excess
lifetime retirement plan distributions. These rules are repealed for plan
distributions made and decedents who die after December 31, 1996.
TAX FILING-REGULAR IRAS: You are not required to file a special IRA tax form for
any taxable year (1) for which no penalty tax is imposed with respect to the IRA
Plan, and (2) in which the only activities engaged in, with respect to the IRA
Plan, are making deductible contributions and receiving permissible
distributions. Information regarding such contributions or distributions will be
included on your regular Form 1040. In some years, you may be required to file
Form 5329 and/or Form 8606 in connection with your Regular IRA. Form 5329 is
filed as an attachment to Form 1040 or 1040A for any tax year that special
penalty taxes apply to your IRA. If you make non-deductible contributions to a
regular IRA, you must designate those contributions as non-deductible on Form
8606 and attach it to your Form 1040 or 1040A. There is a $100 penalty each time
you overstate the amount of your non-deductible contributions unless you can
prove the overstatement was due to reasonable cause. Additional information is
required on Form 8606 in years you receive a distribution from a Regular IRA.
There is a $50 penalty for each failure to file a required Form 8606 unless you
can prove the failure was due to reasonable cause. For further information,
consult the instructions for Form 5329 (Additional Taxes Attributable to
Qualified Retirement Plans (including IRAs), Annuities, and Modified Endowment
Contracts), Form 8606 and IRS Publication 590.
TAX FILING-ROTH IRA: It is your responsibility to keep records of your
contributions to a Roth IRA and to file any income tax forms the Internal
Revenue Service may require of you as a Roth IRA owner. You may need this
information to calculate your taxable income when distributions from the Roth
IRA begin.
TAX ADVICE: Ameritas is providing this general information as required by
regulations issued under the Internal Revenue Code and assumes no responsibility
for its application to your particular tax situation. Please consult your
personal tax advisor regarding specific questions you may have.
With respect to ROTH IRAS, you should be aware that Congress has before it
legislation that would substantially revise the rules relating to distributions
from and conversions to Roth IRAs which may apply retroactive to January 1,
1998. Because of this, you should consult with a tax advisor prior to
establishing, making contributions to, or taking distributions from a Roth IRA,
to ensure that you receive the tax result you anticipate.
ADDITIONAL INFORMATION: You may obtain more information about IRA Plans from any
district office of the IRS and IRS Publication 590.
PART IV. STATUS OF AMERITAS IRA PLAN:
INTERNAL REVENUE SERVICE APPROVAL LETTER: Ameritas has received approval from
the Internal Revenue Service as to the form of No Load Variable Annuity (Form
4080), for use in funding Regular IRA plans. The Policy has also been approved
as to form for use in funding a SIMPLE IRA. It has not, however, been submitted
to the IRS for approval of its use as a Roth IRA, but it is expected that it
will be in due course. You may be required to accept a revised Roth IRA
endorsement if the IRS requires changes to your issued Roth IRA during the IRS
approval process. Such approval, when received, is a determination only as to
the form of the Annuity Contract, and does not represent a determination of the
merits of the annuity.
PART V. FINANCIAL DISCLOSURE:
The following is a general description and required financial disclosure
information for the variable annuity product, No Load Variable Annuity (Form
4080) offered by Ameritas, hereafter referred to as the policy.
QD-7 IRA/SEP/SIMPLE/ROTH
No Load Variable Annuity; 2/98
<PAGE>
In order for you to achieve your retirement objectives, you should be prepared
to make your IRA Plan a long term savings program. An IRA is not suited to
short-term savings, nor was it intended to be by Congress, as indicated by the
general rule that penalties apply to withdrawals before age 59 1/2, subject to
certain exceptions. SEE PART III; PREMATURE IRA DISTRIBUTIONS. However, you
should be aware of the values in your IRA Plan during the early years as well as
at retirement.
Prior to the annuity date, the policy allows you to accumulate funds based on
the investment experience of the assets underlying the policy in the Separate
Account or the Fixed Account. Currently, the assets which underlie the Separate
Account are invested exclusively in shares of mutual funds, the "Funds", managed
or administered by fund managers. Each of the Subaccounts of the Separate
Account invest solely in the corresponding portfolio of the Funds. The assets of
each portfolio are held separately from the other portfolios and each has
distinct investment objectives which are described in the accompanying
prospectus for the Funds which you would have received when making an
application for your annuity. The accumulation value of your IRA Plan allocated
to the Separate Account will vary in accordance with the investment performance
of the Subaccounts you selected. Therefore, for assets in the Separate Account,
you bear the entire investment risk prior to the annuity date.
Premium payments and subsequent allocations to the Fixed Account are placed in
the general account of Ameritas which supports insurance and annuity
obligations. Policyowners are paid interest on the amounts placed in the Fixed
Account at guaranteed rates (3.0%) or at higher rates declared by Ameritas.
ACCUMULATION VALUE: On the effective date, the accumulation value of the policy
is equal to the premium received, reduced by any applicable premium taxes.
Thereafter, the accumulation value of the policy is determined as of the close
of trading on the New York Stock Exchange on each valuation date by multiplying
the number of accumulation units for each Subaccount credited to the policy by
the current value of an accumulation unit for each Subaccount, and by adding the
amount deposited in the Fixed Account, plus interest. The current value of an
accumulation unit reflects the increase or decrease in value due to investment
results of the Subaccount and certain charges, as described below. The number of
accumulation units credited to the policy is decreased by any annual policy fee,
any withdrawals and, upon annuitization, any applicable premium taxes and
charges.
A valuation period is the period between successive valuation dates. It begins
at the close of trading on the New York Stock Exchange on each valuation date
and ends at the close of trading on the next succeeding valuation date. A
valuation date is each day that the New York Stock Exchange is open for
business.
The accumulation value is expected to change from valuation period to valuation
period, reflecting the net investment experience of the selected portfolios of
the Funds, interest earned in the Fixed Account, additional premium payments,
withdrawals, as well as the deduction of any applicable charges under the
policy. GROWTH IN THE ACCUMULATION VALUE BASED ON INVESTMENTS IN THE ACCOUNT IS
NEITHER GUARANTEED NOR PROJECTED.
VALUE OF ACCUMULATION UNITS: The accumulation units of each Subaccount are
valued separately. The value of an accumulation unit may change each valuation
period according to the net investment performance of the shares purchased by
each Subaccount and the daily charge under the policy for mortality and expense
risks, and if applicable, any federal and state income tax charges.
CASH SURRENDER VALUE: The amount available for withdrawal, which is the
accumulation value less any applicable premium taxes, and, in the case of a full
withdrawal, the annual policy fee.
ANNUAL POLICY FEE: An annual policy fee of $25, is deducted from the
accumulation value on the last valuation date of each policy year and on a full
withdrawal if between policy anniversaries. This charge reimburses Ameritas for
the administrative costs of maintaining the policy on Ameritas' system. This
charge may be increased to a maximum of $40.
MORTALITY AND EXPENSE RISK CHARGE: Ameritas imposes a charge to compensate it
for bearing certain mortality and expense risks under the policies. For assuming
these risks, Ameritas makes a daily charge equal to an annual rate of 0.75 %
(current; 0.95% guaranteed) of the value of the average daily net assets of the
Account. This charge is subtracted when determining the daily accumulation unit
value. If this charge is insufficient to cover assumed risks, the loss will fall
on Ameritas. Conversely, if the charge proves more than sufficient, any excess
will be added to Ameritas' surplus. No mortality and expense risk charge is
imposed on the Fixed Account.
TAXES: Ameritas will charge and deduct premium taxes as required by state law
and in accordance with any applicable company election. Applicable premium tax
rates depend upon such factors as the policyowner's current state of residency,
and the insurance laws and the status of Ameritas in states where premium taxes
are incurred. Currently, premium taxes range from 0% to 3.5% of the premium
paid. Applicable premium tax rates are subject to change by legislation,
administrative interpretations, or judicial acts. The owner will be notified of
any applicable premium taxes.
WITHDRAWALS: The owner may make a withdrawal of the policy to receive part or
all of the accumulation value (less any applicable charges), at any time before
the annuity date and while the annuitant is living, by sending a written request
to Ameritas. Withdrawals may be either systematic or elective. Systematic
withdrawals provide for an automatic withdrawal, whereas, each elective
withdrawal must be elected by the owner. Systematic withdrawals are available on
a monthly, quarterly, semi-annual or annual mode. This withdrawal right may be
restricted by Section 403(b)(11) of the Internal Revenue Code if the annuity is
used in connection with a Section 403(b) retirement plan. No withdrawals may be
made after the annuity date except as permitted under the particular annuity
option. The amount available for a withdrawal is the accumulation value at the
end of the valuation period during which the written request for withdrawal is
received, less any applicable premium taxes, and in the case of a full
withdrawal, less the annual policy fee that would be due on the last valuation
date of the policy year. The accumulation value may be paid in a lump sum to the
owner, or, if elected, all or any part may be paid out under an annuity income
option.
SALES COMMISSIONS: No deductions are made from the premium payments for sales
charges. Compensation to the sales force is a maximum .5% based on premiums paid
for broker/dealers other than AIC, and an asset-based administrative
compensation of .10% (annualized).
IRA/SEP/SIMPLE/ROTH QD-8
No Load Variable Annuity; 2/98
<PAGE>
AMERITAS LIFE INSURANCE CORP. LOGO
EMPLOYEE BENEFIT PLAN
INFORMATION STATEMENT
401(a) PENSION/PROFIT SHARING PLANS
- --------------------------------------------------------------------------------
For purchasers of a 401(a) Pension/Profit Sharing Plan, the purpose of this
statement is to inform you as an independent Fiduciary of the Employee Benefit
Plan, of the Sales Representative's relationship to and compensation from
Ameritas Life Insurance Corp. (Ameritas), as well as to describe certain fees
and charges under the No Load Variable Annuity Policy being purchased from the
Sales Representative.
The Sales Representative is appointed with Ameritas as its Sales Representative
and is a Securities Registered Representative. In this position, the Sales
Representative is employed to procure and submit to Ameritas applications for
contracts, including applications for No Load Variable Annuity.
COMMISSIONS, FEES AND CHARGES
The following commissions, fees and charges apply to No Load Variable Annuity
(policy):
SALES COMMISSION: No deductions are made from the premium payments for sales
charges. Compensation to the Sales Representative's Broker/Dealer is a maximum
of up to .5% based on premiums paid for broker/dealers other than AIC, and an
asset-based administrative compensation of .10 (annualized).
ANNUAL POLICY FEE: An annual policy fee of $25 is deducted from the accumulation
value in the policy on the last valuation date of each policy year or on a full
withdrawal if between policy anniversaries. This charge reimburses Ameritas for
the administrative costs of maintaining the policy on Ameritas system. This
charge may be increased to a maximum of $40.
MORTALITY AND EXPENSE RISK CHARGE: Ameritas imposes a charge to compensate it
for bearing certain mortality and expense risks under the policies. Ameritas
makes a daily charge equal to an annual rate of 0.75% (current; 0.95%
guaranteed) of the value of the average daily net assets of the Account under
the policies. This charge is subtracted when determining the daily accumulation
unit value. If this charge is insufficient to cover assumed risks, the loss will
fall on Ameritas. Conversely, if the charge proves more than sufficient, any
excess will be added to Ameritas' surplus. No mortality and expense risk charge
is imposed on the Fixed Account.
WITHDRAWALS: The policyowner may make a withdrawal of the policy to receive part
or all of the accumulation value (less any applicable charges), at any time
before the annuity date and while the annuitant is living by sending a written
request to Ameritas. Withdrawals may be either systematic or elective.
Systematic withdrawals provide for an automatic withdrawal, whereas, each
elective withdrawal must be elected by the owner. Systematic withdrawals are
available on a monthly, quarterly, semi-annual or annual mode. No withdrawals
may be made after the annuity date except as permitted under the particular
annuity option. The amount available for withdrawal is the accumulation value at
the end of the valuation period during which the written request for withdrawal
is received, less any applicable premium taxes, and in the case of a full
withdrawal, the annual policy fee that would be due on the last valuation date
of the policy year. The accumulation value may be paid in a lump sum to the
owner, or if elected, all or any part may be paid out under an annuity income
option.
TAXES: Ameritas will deduct premium taxes upon receipt of a premium payment or
upon annuitization depending upon the requirements of the law of the state of
the policyowner's residence. Currently, premium taxes range from 0% to 3.5% of
the premium paid, but are subject to change by legislation, administrative
interpretations, or judicial act.
FUND INVESTMENT ADVISORY FEES AND EXPENSES: At the direction of the policyowner,
the Separate Account LLVA purchases shares of Funds which are available for
investment under this policy. The net assets of the Separate Account LLVA will
reflect the value of the Fund shares and therefore, investment advisory fees and
other expenses of the Funds. A complete description of these fees and expenses
is contained in the Funds' Prospectuses.
QD-9 IRA/SEP/SIMPLE/ROTH
No Load Variable Annuity; 2/98
<PAGE>
Part B Registration No. 333-5529
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA
STATEMENT OF ADDITIONAL INFORMATION
FOR
FLEXIBLE PREMIUM VARIABLE ANNUITY POLICY
Offered by
Ameritas Life Insurance Corp.
(A Nebraska Stock Company)
5900 "O" Street
Lincoln, Nebraska 68510
---------------------
This Statement of Additional Information expands upon subjects
discussed in the current Prospectus for the Flexible Premium Variable Annuity
Policy ("Policy") offered by Ameritas Life Insurance Corp. ("Ameritas"). You may
obtain a copy of the Prospectus dated May 1, 1998, by writing Ameritas Life
Insurance Corp., 5900 "O" Street, Lincoln, Nebraska 68510, or calling,
1-800-255-9678. Terms used in the current Prospectus for the Policy are
incorporated in this Statement.
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD
BE READ ONLY IN CONJUNCTION WITH THE PROSPECTUS FOR THE POLICY.
Dated: May 1, 1998
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
<S> <C>
GENERAL INFORMATION AND HISTORY ........................................................................... 2
- -------------------------------
THE POLICY ................................................................................................ 2
- ----------
Accumulation Value............................................................................... 2
------------------
Value of Accumulation Units ..................................................................... 2
---------------------------
Calculation of Performance Data ................................................................. 2
-------------------------------
Total Return..................................................................................... 3
------------
Yields........................................................................................... 5
------
GENERAL MATTERS............................................................................................ 6
- ---------------
The Policy ...................................................................................... 6
----------
Non-Participating ............................................................................... 6
-----------------
Assignment ...................................................................................... 6
----------
Annuity Data .................................................................................... 6
------------
Ownership ....................................................................................... 6
---------
IRS Required Distributions ...................................................................... 6
--------------------------
FEDERAL TAX MATTERS ....................................................................................... 7
- -------------------
Taxation of Ameritas ............................................................................ 7
--------------------
Tax Status of the Policies ...................................................................... 7
--------------------------
Qualified Policies .............................................................................. 7
------------------
DISTRIBUTION OF THE POLICY ................................................................................ 7
- --------------------------
SAFEKEEPING OF SEPARATE ACCOUNT ASSETS .................................................................... 8
- --------------------------------------
STATE REGULATION .......................................................................................... 8
- ----------------
LEGAL MATTERS ............................................................................................ 8
- -------------
EXPERTS ................................................................................................... 8
- -------
OTHER INFORMATION ......................................................................................... 8
- -----------------
FINANCIAL STATEMENTS ...................................................................................... 8
- --------------------
</TABLE>
1
<PAGE>
GENERAL INFORMATION AND HISTORY:
- --------------------------------
In order to supplement the description in the Prospectus, the following
provides additional information concerning the company and its history.
Ameritas Life Insurance Corp. Separate Account LLVA ("the Separate
Account") is a separate investment account of Ameritas Life Insurance Corp.
established under Nebraska Law on October 26, 1995. Ameritas Life Insurance
Corp. ("Ameritas") is a stock life insurance company domiciled in Nebraska since
1887. The Home Office of Ameritas is at 5900 "O" Street, Lincoln, Nebraska
68501.
Effective January 1, 1998, Ameritas converted from a mutual insurance
company structure to a mutual insurance holding company structure pursuant
to the Nebraska Mutual Insurance Holding Company Act. The conversion was
approved by the Nebraska State Department of Insurance and the policyowners
of the mutual company.
Currently, ten Subaccounts of the Separate Account are available under
the contracts. Each Subaccount invests in a corresponding investment portfolio
of, Berger Institutional Products Trust ("Berger IPT"), the Neuberger &
Berman Advisers Management Trust ("Neuberger & Berman AMT"), Strong Variable
Insurance Funds, Inc., or Strong Opportunity Fund II, Inc., (collectively
"Strong").
THE POLICY
- ----------
In order to supplement the description in the Prospectus, the following
provides additional information about the Policy which may be of interest to the
owners.
Accumulation Value
- ------------------
The Accumulation Value of a Policy on each valuation date is equal to:
(1) the aggregate of the values attributable to the Policy in each
Subaccount on the valuation date, determined for each Subaccount by
multiplying the Subaccount's accumulation unit price by the number
of the Subaccount accumulation units allocated to the Policy and/or
the net allocation plus interest in the Fixed Account; plus;
(2) the amount deposited in the Fixed Account, plus interest; less
(3) any withdrawal made on the valuation date; less
(4) any annual policy fee deducted on that valuation date. In computing
the accumulation value, the number of Subaccount accumulation units
allocated to the Policy is determined after any transfer among the
Subaccounts.
Value of Accumulation Units
- ---------------------------
The value of each Subaccount's accumulation units reflects the investment
performance of that Subaccount. The accumulation unit price of each Subaccount
shall be calculated by:
(1) multiplying the per share net asset value of the corresponding Fund
portfolio on the valuation date by the number of shares held by the
Subaccount, before the purchase or redemption of any shares on that
date; minus
(2) a daily charge, currently 0.002049% (equivalent to an annual rate of
.75%), not to exceed 0.002595% (equivalent to an annual rate of .95%
of the average daily net assets), for mortality and expense risks;
minus
(3) any applicable charge for federal and state income taxes, if any;
and
(4) dividing the result by the total number of accumulation units held
in the Subaccount on the valuation date, before the purchase or
redemption of any units on that date.
Calculation of Performance Data
- -------------------------------
As disclosed in the prospectus, premium payments will be allocated to the
Separate Account LLVA which has ten Subaccounts, with the assets of each
invested in corresponding portfolios of Berger IPT, Neuberger & Berman AMT, or
Strong ("the Funds"), or to the Fixed Account. From time to time Ameritas will
advertise the performance data of the portfolios of the Funds.
Performance information for any subaccount may be compared, in reports and
advertising to: (1) the Standard & Poor's 500 Stock Index ("S & P 500"), Dow
Jones Industrial Average ("DJIA"), Donahue Money Market Institutional Averages;
(2) other variable annuity separate accounts or other investment products
tracked by Lipper Analytical Services or the Variable Annuity Research and Data
Service, widely used independent research firms which rank mutual funds and
other investment companies by overall performance, investment objectives, and
assets; and (3) the Consumer Price Index (measure for inflation) to assess the
real rate of return from an investment in a contract. Unmanaged indices may
assume the reinvestment of dividends but generally do not reflect deductions for
annuity charges and investment management costs.
Total returns, yields and other performance information may be quoted
numerically or in a table, graph, or similar illustration. Reports and
advertising may also contain other information including (i) the ranking of any
subaccount
2
<PAGE>
<TABLE>
<CAPTION>
derived from rankings of variable annuity separate accounts or other investment
products tracked by Lipper Analytical Series or by rating services, companies,
publications or other persons who rank separate accounts or other investment
products on overall performance or other criteria, and (ii) the effect of tax
deferred compounding on a subaccount's investment returns, or returns in
general, which may be illustrated by graphs, charts, or otherwise, and which may
include a comparison, at various points in time, of the return from an
investment in a contract (or returns in general) on a tax-deferred basis
(assuming one or more tax rates) with the return on a taxable basis.
The tables below are established to demonstrate performance results for
each underlying portfolio with charges deducted at the Separate Account level as
if the policy had been in force from the commencement of the portfolio. The
performance information is based on the historical investment experience of the
underlying portfolios and does not indicate or represent future performance.
Total Return
- ------------
Total returns quoted in advertising reflect all aspects of a subaccount's
return, including the automatic reinvestment by the separate account of all
distributions and any change in the subaccount's value over the period. Average
annual returns are calculated by determining the growth or decline in value of a
hypothetical historical investment in the subaccount over a stated period, and
then calculating the annually compounded percentage rate that would have
produced the same result if the rate of growth or decline in value had been
constant over the period. For example, a cumulative return of 100% over ten
years would produce an average annual return of 7.18% which is the steady rate
that would equal 100% grown on a compounded basis in ten years. While average
annual returns are a convenient means of comparing investment alternatives,
investors should realize that the subaccount's performance is not constant over
time, but changes from year to year, and that average annual returns represent
averaged figures as opposed to the actual year-to-year performance of a
subaccount.
The subaccounts, other than the Liquid Asset subaccount, will quote average
annual returns for the period since the Contracts have been offered after
deducting charges at the Separate Account level. The average annual total
returns will be computed by finding the average annual compounded rates of
return over a period of one, five, and ten years (or, if less, up to the life of
the portfolio), that would equate the initial amount invested to the withdrawal
value, in accordance with the following formula: P(1 + T) SUP n = ERV where P is
a hypothetical investment payment of $1,000, T is the average annual total
return, n is the number of years, and ERV is the withdrawal value at the end of
the periods shown. The returns will reflect the mortality and expense risk
charge (guaranteed not to exceed .95% on an annual basis), and the annual policy
fee. Because there is no surrender charge, the average annual total return would
be the same for the relevant time periods if the contract is continued.
Table 1 shows the average annual total return on a hypothetical investment
in the subaccounts for the last year, five years, and ten years (or, if less, up
to the life of the portfolio) for the period ending December 31, 1997.
Average Annual Total Return for Period Ending on 12/31/97
Berger IPT Since Product
Portfolios Inception One Year Five Year Inception
- ---------- --------- -------- --------- ---------
<S> <C> <C> <C> <C>
100 Fund 05/01/96 N/A N/A 14.44%
Small Company Growth 05/01/96 N/A N/A 21.91%
Neuberger &
Berman AMT
Portfolios
- ----------
Limited Maturity Bond 09/10/84 N/A N/A 6.14%
Growth 09/10/84 N/A N/A 29.29%
Partners 03/22/94 N/A N/A 32.17%
Balanced 02/28/89 N/A N/A 19.28%
Strong
Portfolios
- ----------
Growth Fund II 12/31/96 N/A N/A 28.97%
International Stock Fund II 10/20/95 N/A N/A -13.93%
Opportunity Fund II 05/08/92 N/A N/A 25.93%
</TABLE>
In addition to average annual returns, the Subaccounts, other than the Liquid
Asset subaccount, may quote unaveraged or cumulative total returns reflecting
the simple change in value of an investment over a stated period.
3
<PAGE>
<TABLE>
<CAPTION>
The cumulative total return on a hypothetical investment in the Subaccounts will
be shown for the period of one, five, and ten years (or, if less, up to the life
of the portfolio). The returns reflect the mortality and expense risk charge
(guaranteed not to exceed .95% on an annual basis), and the policy fee. Because
there is no surrender charge, the cumulative total return would be the same for
the relevant time periods if the contract is continued.
Table 2 shows the cumulative total return on a hypothetical investment
in the Subaccounts for the period of one, five, and ten years (or, if less, up
to the life of the portfolio) for the period ending December 31, 1997.
Cumulative Total Return For Period Ending on 12/31/97
Berger IPT Since Product
Portfolios Inception One Year Five Year Inception
- ---------- --------- -------- --------- ------------
<S> <C> <C> <C> <C>
100 Fund 05/01/96 N/A N/A 14.36%
Small Company Growth 05/01/96 N/A N/A 21.78%
Neuberger &
Berman AMT
Portfolios
- ----------
Limited Maturity Bond 09/10/84 N/A N/A 6.10%
Growth 09/10/84 N/A N/A 29.11%
Partners 03/22/94 N/A N/A 31.96%
Balanced 02/28/89 N/A N/A 19.17%
Strong
Portfolios
- ----------
Growth Fund II 12/31/96 N/A N/A 28.79%
International Stock Fund II 10/20/95 N/A N/A -13.86%
Opportunity Fund II 05/08/92 N/A N/A 25.77%
</TABLE>
Hypothetical Performance
- ------------------------
Hypothetical quotations of average annual total return may also be
shown for a Subaccount for periods prior to the Contract being offered, based
upon the actual historical performance of the mutual fund portfolio in which the
subaccount invests. This information reflects all actual charges and deductions
of the mutual fund Portfolio and all Separate Account charges and deductions,
with respect to the Contracts, that hypothetically would have been made had the
Separate Account, with respect to the Contracts, been invested in these
Portfolios for all the periods indicated. This is calculated in a manner similar
to standardized average annual total return.
Table 3 shows the hypothetical historical average annual total return on a
hypothetical investment of $30,000 in the subaccounts for the last year, five
years, and ten years (or, if less, up to the life of the portfolio) for the
period ending December 31, 1997.
Hypothetical Historical Average Annual Total Return for Period Ending on
12/31/97
<TABLE>
<CAPTION>
Berger IPT 10 Years or
Portfolios Inception One Year Five Year Life of Fund
- ---------- --------- -------- --------- -------------
<S>
<C> <C> <C> <C>
100 Fund 05/01/96 12.84% N/A 9.67%
Small Company Growth 05/01/96 20.34% N/A 10.99%
Neuberger &
Berman AMT
Portfolios
- ----------
Limited Maturity Bond 09/10/84 5.86% 4.76% 6.19%*
Growth 09/10/84 27.97% 12.56% 13.98%*
Partners 03/22/94 30.19% N/A 23.19%
Balanced 02/28/89 18.48% 9.31% 10.32%
</TABLE>
* 10 Year Figure
4
<PAGE>
<TABLE>
<CAPTION>
Strong 10 Years or
Portfolios Inception One Year Five Year Life of Fund
- ---------- --------- -------- --------- ------------
<S> <C> <C> <C> <C>
Growth Fund II 12/31/96 28.70% N/A 28.70%
International Stock Fund II 10/20/95 -14.33% N/A -1.78%
Opportunity Fund II 05/08/92 24.44% 18.36% 19.06%
Table 4 shows the hypothetical historical cumulative total return on a
hypothetical investment of $30,000 in the Subaccounts for the last year, five
years, and ten years (or, if less, up to the life of the portfolio) for the
period ending December 31, 1997.
Hypothetical Historical Cumulative Total Return for Period Ending on 12/31/97
Berger IPT 10 Years or
Portfolios One Year Five Year Life of Fund
- ---------- -------- --------- ------------
<S> <C> <C> <C>
100 Fund 12.84% N/A 16.65%
Small Company Growth 20.34% N/A 19.00%
Neuberger &
Berman AMT
Portfolios
- ----------
Limited Maturity Bond 5.86% 26.20% 82.24%*
Growth 27.97% 80.69% 270.02%*
Partners 30.19% N/A 120.05%
Balanced 18.48% 56.06% 138.27%
Strong
Portfolios
- ----------
Growth Fund II 28.70% N/A 28.70%
International Stock Fund II -14.33% N/A -3.88%
Opportunity Fund II 24.44% 132.27% 168.11%
</TABLE>
* 10 Year Figure
Yields
- ------
Some Subaccounts may also advertise yields. Yields quoted in advertising
reflect the change in value of a hypothetical investment in the Subaccount over
a stated period of time, not taking into account capital gains or losses.
Yields are annualized and stated as a percentage.
Current yield for Liquid Asset Subaccount reflects the income generated by
a subaccount over a 7-day period. Current yield is calculated by determining the
net change, exclusive of capital changes, in the value of a hypothetical
subaccount having one Accumulation Unit at the beginning of the period adjusting
for the annual policy fee, and dividing the difference by the value of the
Subaccount at the beginning of the base period to obtain the base period return,
and multiplying the base period return by (365/7). The resulting yield figure is
carried to the nearest hundredth of a percent. Effective yield for the Liquid
Asset subaccount is calculated in a similar manner to current yield except that
investment income is assumed to be reinvested throughout the year at the 7-day
rate. Effective yield is obtained by taking the base period returns as computed
above, and then compounding the base period return by adding 1, raising the sum
to a power equal to (365/7) and subtracting one from the result, according to
the formula:
Effective Yield = [(Base Period Return + 1) SUP 365/7] - 1.
Since the reinvestment of income is assumed in the calculation of effective
yield, it will generally be higher than current yield.
The hypothetical historical net average yield for the 7-day period ended
December 31, 1997 for the Liquid Asset Portfolio was 3.86% and the hypothetical
historical effective yield for the 7-day period ended December 31, 1997 for the
Liquid Asset Portfolio was 3.94% .
5
<PAGE>
Current yield for subaccounts other than the Liquid Asset subaccount reflects
the income generated by a subaccount over a 30-day period. Current yield is
calculated by dividing the net investment income per accumulation unit earned
during the period by the maximum offering price per unit on the last day of the
period, according to the formula:
YIELD =2[( FUNC{a-b} OVER cd; +1) SUP 6 -1]
Where a = net investment income earned during the period by the portfolio
company attributable to shares owned by the subaccount, b = expenses accrued for
the period (net of reimbursements), c = the average daily number of accumulation
units outstanding during the period, and d = the maximum offering price per
accumulation unit on the last day of the period. The yield reflects the
mortality and expense risk charge and the annual policy fee.
GENERAL MATTERS
- ---------------
The Policy
- ----------
The Policy, the application, any supplemental applications, and any
amendments or endorsements make up the entire contract. All statements made in
the application, in the absence of fraud, are considered representations and not
warranties. Only statements in the application that is attached to the Policy
and any supplemental applications made a part of the Policy when a change went
into effect can be used to contest a claim or the validity of the Policy. Only
the President, Vice President, Secretary or Assistant Secretary of Ameritas can
modify the Policy. Any changes must be made in writing, and approved by
Ameritas. No agent has the authority to alter or modify any of the terms,
conditions or agreements of the Policy or to waive any of its provisions.
Non-Participating
- -----------------
The Policies are non-participating. No dividends are payable and the Policies
will not share in the profits or surplus earnings of Ameritas.
Assignment
- ----------
Any non-qualified policy and any qualified policy, if permitted by the plan
or by law relevant to the plan applicable to the qualified policy, may be
assigned by the owner prior to the annuity date and during the annuitant's
lifetime. Ameritas is not responsible for the validity of any assignment. No
assignment will be recognized until Ameritas receives written notice thereof.
The interest of any beneficiary which the assignor has the right to change shall
be subordinate to the interest of an assignee. Any amount paid to the assignee
shall be paid in one sum, not withstanding any settlement agreement in effect at
the time the assignment was executed. Ameritas shall not be liable as to any
payment or other settlement made by Ameritas before receipt of written notice.
Annuity Data
- ------------
Ameritas will not be liable for obligations which depend on receiving
information from a payee until such information is received in a form
satisfactory to Ameritas.
Ownership
- ---------
The owner of the Policy on the policy date is the annuitant, unless otherwise
specified in the application. During the annuitant's lifetime, all rights and
privileges under this Policy may be exercised solely by the owner. Ownership
passes to the Owner's Designated Beneficiary upon the death of the owner(s). If
there is no Owner's Designated Beneficiary, or if no Owner's Designated
Beneficiary is living, ownership will pass to the owner's estate. From time to
time Ameritas may require proof that the owner is still living.
In order to change the owner of the Policy or assign Policy rights, an
assignment of the Policy must be made in writing and filed with Ameritas at its
Home Office. The change will take effect as of the date the change is recorded
at the Home Office, and Ameritas will not be liable for any payment made or
action taken before the change is recorded. The payment of proceeds is subject
to the rights of any assignee of record. A change in the owner will be valid
only upon absolute and complete assignment of the Policy. A collateral
assignment is not a change of ownership.
IRS Required Distributions
- --------------------------
If the owner dies before the entire interest in the Policy is distributed,
the value of the Policy must be distributed to the Owner's Designated
Beneficiary as described in this section so that the Policy qualifies as an
annuity under the Code. If the owner is not an individual, death of the
annuitant will be treated as death of the owner.
If the death occurs on or after the annuity date, the remaining portion of
such interest will be distributed at least as rapidly as under the method of
distribution being used as of the date of death.
6
<PAGE>
If the death occurs before the annuity date, the entire interest in the
Policy will be distributed within five years after date of death or be used to
purchase an immediate annuity under which payments will begin within one year of
the owner's death and will be made for the life of the owner's designated
beneficiary or for a period not extending beyond the life expectancy of that
beneficiary.
The owner's designated beneficiary is the person to whom ownership of the
Policy passes by reason of death of the owner and must be a natural person.
Ameritas reserves the right to require proof of death.
If any portion of the owner's interest is payable to (or for the benefit of)
the surviving spouse of the owner, the Policy may be continued with the
surviving spouse as the new owner.
FEDERAL TAX MATTERS
- -------------------
Taxation of Ameritas
- --------------------
Ameritas is taxed as a life insurance company under Part I of Subchapter L of
the Code. Since the Separate Account is not an entity separate from Ameritas and
its operations form a part of Ameritas, it will not be taxed separately as a
"regulated investment company" under Subchapter M of the Code. Investment income
and realized net capital gains on the assets of the Separate Account are
reinvested and are taken into account in determining the Policy values. As a
result, such investment income and realized net capital gains are automatically
retained as part of the reserves under the Policy. Under existing federal income
tax law, Ameritas believes that Separate Account investment income and realized
net capital gains should not be taxed to the extent that such income and gains
are retained as part of the reserves under the Policy.
Tax Status of the Policies
- --------------------------
Section 817(h) of the Code provides in substance that Section 72 of the Code
will not apply and Ameritas will not be treated as the owner of the assets of
the Separate Account unless the investments made by the Separate Account are
"adequately diversified" in accordance with regulations prescribed by the
Secretary of Treasury (the "Treasury"). If the segregated account is not
"adequately diversified" any increase in the value of a variable annuity
contract will be taxed to the owner currently. The Separate Account, through the
fund, intends to comply with the diversification requirements prescribed by
Treasury regulations which affect how the Fund's assets may be invested.
Although Ameritas does not control the Fund, it has entered into an agreement
regarding participation in the Fund, which requires the Fund to be operated in
compliance with the requirements prescribed by the Treasury.
Qualified Policies
- ------------------
The Policies are designed for use with several types of qualified plans. The
following are brief descriptions of qualified plans with which the policies may
be used:
a. H.R. 10 Plans - Section 401 of the Code permits self-employed
individuals to establish qualified plans for themselves and their
employees. Such plans commonly are referred to as "H.R. 10" or "Keogh"
plans. Taxation of plan participants depends on the specified plan.
The Code governs such plans with respect to maximum contributions,
distribution dates, non-forfeitability of interests, and tax rates
applicable to distributions. In order to establish such a plan, a plan
document, usually in prototype form preapproved by the Internal
Revenue Service, is adopted and implemented by the employer. When
issued in connection with H.R. 10 plans, a Policy may be subject to
special requirements to conform to the requirements under such plans.
b. Individual Retirement Annuities - Section 408 of the Code permits
certain individuals to contribute to an individual retirement program
known as an "Individual Retirement Annuity" or an "IRA." IRA's are
subject to limitations on eligibility, maximum contributions, and time
of distribution. Distributions from certain other types of qualified
plans may be "rolled over" on a tax-deferred basis into an IRA. Sales
of a Policy for use with an IRA may be subject to special requirements
of the Internal Revenue Service. Purchasers of a Policy for such
purposes will be provided with supplemental information required by
the Internal Revenue Service or other appropriate agency.
c. Corporation Pension and Profit Sharing Plans -- Sections 401(a) and
403(a) of the Code permit corporate employers to establish various
types of retirement plans for employees. Such retirement plans may
permit the purchase of Policies in order to provide benefits under the
plans.
DISTRIBUTION OF THE POLICY
- --------------------------
Ameritas Investment Corp. ("AIC"), the principal underwriter of the
Policies, is registered with the Securities and Exchange Commission under the
Securities and Exchange Act of 1934 as a broker-dealer and is a member of the
National Association of Securities Dealers, Inc. Ameritas Investment Corp. is
wholly owned by AMAL Corporation. Ameritas owns a majority interest in AMAL
Corporation.
7
<PAGE>
The Policies are offered to the public directly from Ameritas through
Veritas, Ameritas' wholly owned direct-to-consumer subsidiary, with salaried
employees who are registered representatives of AIC and who will not receive
compensation related to the purchase. The Policies may also be purchased through
brokers licensed under the federal securities laws and state insurance laws, and
properly licensed banking institutions that have entered into agreements with
Ameritas Investment Corp. The offering of the Policies is continuous and
Ameritas Investment Corp. may discontinue the offering of this policy in certain
states and continue to offer it in other states.
Compensation for the Policies and for all other variable annuity policies
issued by Ameritas totalled $4,677 for 1997, and $0 for 1996 and all prior
years.
SAFEKEEPING OF SEPARATE ACCOUNT ASSETS
- ---------------------------------------
Title to assets of the Separate Account is held by Ameritas. The assets are
kept physically segregated and held separate and apart from Ameritas' general
account assets. Accumulation values deposited or transferred to the Fixed
Account are held in the General Account of Ameritas. Records are maintained of
all purchases and redemptions of eligible portfolio shares held by each of the
Subaccounts.
STATE REGULATION
- ----------------
Ameritas is a stock life insurance company organized under the laws of
Nebraska, and is subject to regulation by the Nebraska State Department of
Insurance. An annual statement is filed with the Nebraska Commissioner of
Insurance on or before March 1 of each year covering the operations and
reporting on the financial condition of Ameritas as of December 31 of the
preceding calendar year. Periodically, the Nebraska Commissioner of Insurance
examines the financial condition of Ameritas, including the liabilities and
reserves of the Separate Account.
In addition, Ameritas is subject to the insurance laws and regulations of
all the states where it is licensed to operate. The availability of certain
policy rights and provisions depends on state approval and/or filing and review
process. Where required by state law or regulation, the Policy will be modified
accordingly.
LEGAL MATTERS
- -------------
All matters of Nebraska law pertaining to the validity of the Policy and
Ameritas' right to issue such Policies under Nebraska law have been passed upon
by Norman M. Krivosha, Executive Vice President, Secretary and Corporate General
Counsel of Ameritas.
EXPERTS
- -------
The consolidated financial statements of Ameritas as of December 31, 1997
and 1996, and for each of the three years in the period ended December 31, 1997,
and the financial statements of Separate Account LLVA as of December 31, 1997,
and for the year then ended, included in this Statement of Additional
Information have been audited by Deloitte & Touche LLP, 1040 NBC Center,
Lincoln, Nebraska 68508, 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.
OTHER INFORMATION
- -----------------
A registration Statement has been filed with the Securities and Exchange
Commission, under the Securities Act of 1933, as amended, with respect to the
Policy discussed in this Statement of Additional Information. Not all of the
information set forth in the Registration Statement, amendments and exhibits
thereto has been included in this Statement of Additional Information or in the
Prospectus. Statements contained in this Statement of Additional Information and
the Prospectus concerning the content of the policies and other legal
instruments are intended to be summaries. For a complete statement of the terms
of these documents, reference should be made to the instruments filed with the
Securities and Exchange Commission.
FINANCIAL STATEMENTS
- --------------------
The financial statements of Ameritas, which are included in this Statement of
Additional Information, should be considered only as bearing on the ability of
Ameritas to meet its obligations under the Policies. They should not be
considered as bearing on the investment performance of the assets held in the
Separate Account.
8
<PAGE>
Independent Auditors' Report
Board of Directors
Ameritas Life Insurance Corp.
Lincoln, Nebraska
We have audited the accompanying statement of net assets of Ameritas Life
Insurance Corp. Separate Account LLVA as of December 31, 1997, and the related
statements of operations and changes in net assets 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. Our procedures included
confirmation of securities owned at December 31, 1997. 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.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of Ameritas Life Insurance Corp. Separate
Account LLVA as of December 31, 1997, and the results of its operations and
changes in its net assets for the year then ended, in conformity with generally
accepted accounting principles.
/s/Deloitte & Touche LLP
Lincoln, Nebraska
February 2, 1998
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
SEPARATE ACCOUNT LLVA
---------------------
STATEMENT OF NET ASSETS
-----------------------
DECEMBER 31, 1997
-----------------
ASSETS
INVESTMENTS AT NET ASSET VALUE:
NEUBERGER & BERMAN ADVISERS MANAGEMENT TRUST:
---------------------------------------------
<S> <C>
Balanced Portfolio - 12,167.134 shares at
$17.80 per share (cost $208,237) $ 216,575
Growth Portfolio - 2,390.452 shares at
$30.54 per share (cost $64,904) 73,004
Partners Portfolio - 28,400.091 shares at
$20.60 per share (cost $525,966) 585,042
Limited Maturity Bond Portfolio - 35,498.016 shares at
$14.12 per share (cost $497,236) 501,232
Liquid Assets Portfolio - 300,600.080 shares at
$1.00 per share (cost $300,600) 300,600
STRONG VARIABLE INSURANCE FUNDS, INC.:
--------------------------------------
International Stock Fund II Portfolio - 6,823.144 shares at
$9.32 per share (cost $75,749) 63,592
Growth Fund II Portfolio - 1,511.266 shares at
$12.45 per share (cost $16,505) 18,815
STRONG OPPORTUNITY FUND II, INC.:
---------------------------------
Opportunity Fund II, Inc. Portfolio - 2,072.755 shares at
$21.70 per share (cost $42,356) 44,979
BERGER INSTITUTIONAL PRODUCTS TRUST:
------------------------------------
100 Fund Portfolio - 13,489.758 shares at
$11.11 per share (cost $147,699) 149,871
Small Company Growth Portfolio - 5,350.946 shares at
$12.06 per share (cost $52,723) 64,532
---------------
NET ASSETS REPRESENTING EQUITY OF POLICYOWNERS $ 2,018,242
===============
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
SEPARATE ACCOUNT LLVA
---------------------
STATEMENT OF OPERATIONS
-----------------------
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------
NEUBERGER & BERMAN
ADVISERS MANAGEMENT TRUST
-----------------------------------------------
BALANCED GROWTH PARTNERS
TOTAL PORTFOLIO (1) PORTFOLIO (2) PORTFOLIO (3)
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividend distributions received $ 16,062 $ 201 $ ----- $ -----
Mortality and expense risk charge 6,504 437 294 1,972
-------------- -------------- -------------- --------------
NET INVESTMENT INCOME(LOSS) 9,558 (236) (294) (1,972)
-------------- -------------- -------------- --------------
REALIZED AND UNREALIZED GAIN(LOSS) ON INVESTMENTS:
Net realized gain(loss) on investments 8,134 516 ----- -----
Net change in unrealized appreciation(depreciation) 86,268 8,338 8,100 59,076
-------------- -------------- -------------- --------------
NET GAIN(LOSS) ON INVESTMENTS 94,402 8,854 8,100 59,076
-------------- -------------- -------------- --------------
NET INCREASE(DECREASE)IN NET ASSETS RESULTING FROM OPERATIONS $ 103,960 $ 8,618 $ 7,806 $ 57,104
============= ============== ============== ==============
(1) Commenced business 02/12/97 (6) Commenced business 02/04/97
(2) Commenced business 03/05/97 (7) Commenced business 02/04/97
(3) Commenced business 03/18/97 (8) Commenced business 02/10/97
(4) Commenced business 02/12/97 (9) Commenced business 03/05/97
(5) Commenced business 01/22/97 (10) Commenced business 02/04/97
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(CONTINUED)
NEUBERGER & BERMAN
ADVISERS MANAGEMENT TRUST STRONG VARIABLE INSURANCE FUNDS, INC. BERGER INSTITUTIONAL PRODUCTS TRUST
- ------------------------------------- -------------------------------------------------- -----------------------------------
LIMITED INTERNATIONAL SMALL
MATURITY STOCK GROWTH OPPORTUNITY COMPANY
BOND LIQUID ASSETS FUND II FUND II FUND II, INC. 100 FUND GROWTH
PORTFOLIO (4) PORTFOLIO (5) PORTFOLIO (6) PORTFOLIO (7) PORTFOLIO (8) PORTFOLIO (9) PORTFOLIO (10)
---------------- ---------------- ---------------- ---------------- ---------------- ----------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
$ 220 $ 11,576 $ 401 $ 233 $ 95 $ 3,336 $ -----
487 1,831 259 89 179 682 274
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------
(267) 9,745 142 144 (84) 2,654 (274)
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------
----- ----- 520 502 1,365 5,231 -----
3,996 ----- (12,157) 2,310 2,623 2,173 11,809
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------
3,996 ----- (11,637) 2,812 3,988 7,404 11,809
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------
$ 3,729 $ 9,745 $ (11,495)$ 2,956 $ 3,904 $ 10,058 $ 11,535
================ ================ ================ ================ ================ ================ ===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
SEPARATE ACCOUNT LLVA
---------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------
NEUBERGER & BERMAN
ADVISERS MANAGEMENT TRUST
--------------------------------------------------
BALANCED GROWTH PARTNERS
TOTAL PORTFOLIO (1) PORTFOLIO (2) PORTFOLIO (3)
---------------- ---------------- ---------------- ----------------
INCREASE(DECREASE) IN NET ASSETS FROM OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment income(loss) $ 9,558 $ (236)$ (294)$ (1,972)
Net realized gain(loss) on investments 8,134 516 ----- -----
Net change in unrealized appreciation(depreciation) 86,268 8,338 8,100 59,076
---------------- ---------------- ---------------- ----------------
NET INCREASE(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 103,960 8,618 7,806 57,104
NET INCREASE(DECREASE) FROM POLICYHOLDER TRANSACTIONS 1,914,282 207,957 65,198 527,938
---------------- ---------------- ---------------- ----------------
TOTAL INCREASE(DECREASE) IN NET ASSETS 2,018,242 216,575 73,004 585,042
---------------- ---------------- ---------------- ----------------
NET ASSETS AT JANUARY 1, 1997 ----- ----- ----- -----
================ ================ ================ ================
NET ASSETS AT DECEMBER 31, 1997 $ 2,018,242 $ 216,575 $ 73,004 $ 585,042
================ ================ ================ ================
(1) Commenced business 02/12/97 (6) Commenced business 02/04/97
(2) Commenced business 03/05/97 (7) Commenced business 02/04/97
(3) Commenced business 03/18/97 (8) Commenced business 02/10/97
(4) Commenced business 02/12/97 (9) Commenced business 03/05/97
(5) Commenced business 01/22/97 (10) Commenced business 02/04/97
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(CONTINUED)
NEUBERGER & BERMAN
ADVISERS MANAGEMENT TRUST STRONG VARIABLE INSURANCE FUND, INC. BERGER INSTITUTIONAL PRODUCTS TRUST
- ------------------------------------- --------------------------------------------------- -----------------------------------
LIMITED INTERNATIONAL SMALL
MATURITY STOCK GROWTH OPPORTUNITY COMPANY
BOND LIQUID ASSETS FUND II FUND II FUND II, INC. 100 FUND GROWTH
PORTFOLIO (4) PORTFOLIO (5) PORTFOLIO (6) PORTFOLIO (7) PORTFOLIO (8) PORTFOLIO (9) PORTFOLIO (10)
---------------- --------------------------------- ---------------- ---------------- ---------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
$ (267)$ 9,745 $ 142 $ 144 $ (84)$ 2,654 $ (274)
----- ----- 520 502 1,365 5,231 -----
3,996 ----- (12,157) 2,310 2,623 2,173 11,809
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- -----------------
3,729 9,745 (11,495) 2,956 3,904 10,058 11,535
497,503 290,855 75,087 15,859 41,075 139,813 52,997
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- -----------------
501,232 300,600 63,592 18,815 44,979 149,871 64,532
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- -----------------
----- ----- ----- ----- ----- ----- -----
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- -----------------
$ 501,232 $ 300,600 $ 63,592 $ 18,815 $ 44,979 $ 149,871 $ 64,532
================ ================ ================ ================ ================ ================ =================
</TABLE>
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
SEPARATE ACCOUNT LLVA
---------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -------------------------------------------------------------------------
Ameritas Life Insurance Corp. Separate Account LLVA (the Account) was
established under Nebraska law on October 26, 1995. The assets of the Account
are held by Ameritas Life Insurance Corp. (ALIC) and are segregated from all of
ALIC's other assets.
The Account is registered under the Investment Company Act of 1940, as amended,
as a unit investment trust. At December 31, 1997 there are ten subaccounts
within the Account. Five of the subaccounts invest only in a corresponding
Portfolio of the Neuberger & Berman Advisers Management Trust which is a
diversified open-end management investment company managed by Neuberger & Berman
Management Incorporated. Two of the subaccounts invest only in a corresponding
Portfolio of the Berger Institutional Products Trust which is a diversified
open-end management investment company managed by Berger Associates. Two of the
subaccounts invest only in a corresponding Portfolio of the Strong Variable
Insurance Funds, Inc. and one subaccount invests only in a corresponding
Portfolio of Strong Opportunity Fund II, Inc. Both funds are diversified
open-end management investment companies and are managed by Strong Capital
Management, Inc. Each Portfolio pays the manager a monthly fee for managing its
investments and business affairs. The assets of the Account are carried at the
net asset value of the underlying Portfolios of the funds, and the value of the
policyowners' units corresponds to the Account's investment in the underlying
subaccounts.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
VALUATION OF INVESTMENTS
The assets of the account are carried at the net asset value of the underlying
Portfolios of the Funds. The value of the policyowners' units corresponds to the
Account's investment in the underlying subaccounts. The availability of
investment portfolio and subaccount options may vary between products. Share
transactions and security transactions are accounted for on a trade date basis.
FEDERAL AND STATE TAXES
The operations of the Account are included in the federal income tax return of
ALIC, which is taxed as a life insurance company under the Internal Revenue
Code. ALIC has the right to charge the Account any federal income taxes, or
provision for federal income taxes, attributable to the operations of the
Account or to the policies funded in the Account. Currently, ALIC does not make
a charge for income or other taxes. Charges for state and local taxes, if any,
attributable to the Account may also be made.
2. POLICYHOLDER CHARGES
- -------------------------
ALIC charges the account for mortality and expense risks assumed. A daily charge
is made on the average daily value of the net assets representing equity of
policyowners held in each subaccount per each product's current policy
provisions. Additional charges are made at intervals and in amounts per each
product's current policy provisions. These charges are prorated against the
balance in each investment option of the policyowner, including the Fixed
Account option which is not reflected in this separate account.
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
SEPARATE ACCOUNT LLVA
---------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
3. SHARES OWNED
- ----------------
The Account invests in shares of mutual funds. Share activity and total shares owned are as follows:
NEUBERGER & BERMAN ADVISERS MANAGEMENT TRUST
------------------------------------------------------------------------------------
LIMITED
MATURITY
BALANCED GROWTH PARTNERS BOND LIQUID ASSETS
PORTFOLIO (1) PORTFOLIO (2) PORTFOLIO (3) PORTFOLIO (4) PORTFOLIO (5)
---------------- --------------- -------------- ---------------- ---------------
<S> <C> <C> <C> <C> <C>
Shares owned at January 1, 1997 ----- ----- ----- ----- -----
Shares acquired 12,638.796 2,932.267 30,237.460 37,110.661 4,880,248.700
Shares disposed of 471.662 541.815 1,837.369 1,612.645 4,579,648.620
---------------- --------------- -------------- ---------------- ---------------
Shares owned at December 31, 1997 12,167.134 2,390.452 28,400.091 35,498.016 300,600.080
================ =============== ============== ================ ===============
(1) Commenced business 02/12/97 (6) Commenced business 02/04/97
(2) Commenced business 03/05/97 (7) Commenced business 02/04/97
(3) Commenced business 03/18/97 (8) Commenced business 02/10/97
(4) Commenced business 02/12/97 (9) Commenced business 03/05/97
(5) Commenced business 01/22/97 (10) Commenced business 02/04/97
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(CONTINUED)
STRONG VARIABLE INSURANCE FUNDS, INC. BERGER INSTITUTIONAL PRODUCTS TRUST
- ---------------------------------------------------- ----------------------------------
INTERNATIONAL SMALL
STOCK GROWTH OPPORTUNITY COMPANY
FUND II FUND II FUND II, INC. 100 FUND GROWTH
PORTFOLIO (6) PORTFOLIO (7) PORTFOLIO (8) PORTFOLIO (9) PORTFOLIO (10)
- ----------------- ---------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C>
----- ----- ----- ----- -----
7,748.521 1,520.146 3,281.788 14,664.414 5,888.960
925.377 8.880 1,209.033 1,174.656 538.014
- ----------------- ---------------- --------------- ---------------- ----------------
6,823.144 1,511.266 2,072.755 13,489.758 5,350.946
================= ================ =============== ================ ================
</TABLE>
<PAGE>
Independent Auditors' Report
Board of Directors
Ameritas Life Insurance Corp.
Lincoln, Nebraska
We have audited the accompanying consolidated balance sheets of Ameritas
Life Insurance Corp. and subsidiaries as of December 31, 1997 and 1996, and the
related statements of operations, equity, and cash flows for each of the three
years in the period ended December 31, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Ameritas Life Insurance Corp.
and subsidiaries as of December 31, 1997 and 1996, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1997, in conformity with generally accepted accounting principles.
/s/Deloitte & Touche LLP
Lincoln, Nebraska
February 2, 1998
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
CONSOLIDATED BALANCE SHEETS
---------------------------
(in thousands)
DECEMBER 31
----------------------------
ASSETS 1997 1996
----------- -----------
Investments:
<S> <C> <C>
Fixed maturity securities held to maturity (fair value $792,856 - 1997, $ 754,581 $ 775,875
$798,991 - 1996)
Fixed maturity securities available for sale (amortized cost $462,831 -
1997, $408,467 - 1996) 479,990 415,705
Equity securities (cost $59,383 - 1997, $43,079 - 1996) 108,744 75,215
Mortgage loans on real estate 228,709 226,776
Loans on insurance policies 70,638 68,017
Real estate, less accumulated depreciation ($18,324 - 1997, $11,589 - 43,085 33,636
1996)
Other investments 33,971 46,295
Short-term investments 655 1,541
------------ ------------
Total investments 1,720,373 1,643,060
Cash and cash equivalents 83,139 77,142
Accrued investment income 25,186 25,176
Deferred policy acquisition costs 164,564 146,405
Property and equipment, less accumulated depreciation ($29,199 - 1997,
$29,910 - 1996) 20,191 17,532
Other assets 16,668 13,453
Separate accounts 1,437,165 1,037,359
------------ ------------
Total $ 3,467,286 $ 2,960,127
============ ============
LIABILITIES AND EQUITY
Policy and contract reserves $ 364,168 $ 367,614
Policy and contract claims 27,467 21,420
Accumulated contract values 1,039,938 1,007,734
Unearned policy charges 13,177 13,492
Unearned reinsurance ceded allowance 1,763 1,252
Federal income taxes--
Current 339 9,351
Deferred 46,236 36,083
Dividends payable 10,134 10,317
Other liabilities 41,467 35,532
Separate accounts 1,436,677 1,037,359
------------ ------------
Total Liabilities 2,981,366 2,540,154
------------ ------------
Commitments and contingencies
Minority interest in subsidiary 24,483 20,809
Policyowners' contingency reserves 419,797 373,923
Net unrealized investment gain 41,640 25,241
------------ ------------
Total Equity 461,437 399,164
------------ ------------
Total $ 3,467,286 $ 2,960,127
============ ============
The accompanying notes to consolidated financial statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
(in thousands)
YEARS ENDED DECEMBER 31
-----------------------------------------------
1997 1996 1995
---------------- --------------- ------------
INCOME:
Insurance revenues:
Premiums:
<S> <C> <C> <C>
Life insurance $ 26,794 $ 26,855 $ 30,857
Accident and health insurance 181,952 163,557 163,659
Contract charges 57,199 49,667 38,629
Reinsurance, net (1,037) (6,205) (5,559)
Reinsurance ceded allowance 2,475 1,746 1,446
Investment revenues:
Investment income, net 137,744 126,862 124,549
Realized gains, net 10,295 13,103 4,471
Other 14,987 8,961 6,936
---------------- --------------- ------------
430,409 384,546 364,988
---------------- --------------- ------------
BENEFITS AND EXPENSES:
Policy benefits:
Death benefits 20,710 18,402 17,072
Surrender benefits 10,084 10,708 9,401
Accident and health benefits 130,908 112,005 112,935
Interest credited 66,788 65,494 64,598
Increase (decrease) in policy and contract reserves (3,307) (5,060) 959
Other 13,589 12,849 13,265
Sales and operating expenses 90,737 77,086 70,414
Amortization of deferred policy acquisition costs 16,441 16,790 9,405
---------------- -------------- ------------
345,950 308,274 298,049
---------------- -------------- ------------
INCOME BEFORE DIVIDENDS, FEDERAL INCOME TAXES AND MINORITY
INTEREST IN EARNINGS OF SUBSIDIARY 84,459 76,272 66,939
Dividends appropriated for policyowners 10,158 10,367 10,543
---------------- -------------- ------------
INCOME BEFORE FEDERAL INCOME TAXES AND MINORITY INTEREST IN
EARNINGS OF SUBSIDIARY 74,301 65,905 56,396
Income taxes - current 26,401 29,081 16,954
Income taxes - deferred 39 (1,560) 694
Total federal income taxes ---------------- -------------- ------------
26,440 27,521 17,648
---------------- -------------- ------------
INCOME BEFORE MINORITY INTEREST IN EARNINGS OF SUBSIDIARY 47,861 38,384 38,748
Minority interest in earnings of subsidiary (1,987) (1,259) -
---------------- -------------- ------------
NET INCOME $ 45,874 $ 37,125 $ 38,748
================ ============== ============
The accompanying notes to consolidated financial statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
CONSOLIDATED STATEMENTS OF EQUITY
---------------------------------
(IN THOUSANDS)
POLICYOWNERS' NET UNREALIZED
CONTINGENCY INVESTMENT TOTAL
RESERVES GAIN/(LOSS) EQUITY
---------------- ---------------- ---------------
<S> <C> <C> <C>
BALANCE, January 1, 1995 $ 298,050 $ 977 $ 299,027
Net unrealized investment gains, net - 30,683 30,683
Net income 38,748 - 38,748
---------------- ---------------- ---------------
BALANCE, December 31, 1995 336,798 31,660 368,458
Net unrealized investment losses, net - (6,446) (6,446)
Minority interest in net unrealized investment
losses, net - 27 27
Net income 37,125 - 37,125
---------------- ---------------- ---------------
BALANCE, December 31, 1996 373,923 25,241 399,164
Net unrealized investment gains, net - 16,557 16,557
Minority interest in net unrealized investment
gains, net - (158) (158)
Net income 45,874 - 45,874
---------------- ---------------- ---------------
BALANCE, December 31, 1997 $ 419,797 $ 41,640 $ 461,437
================ ================ ===============
The accompanying notes to consolidated financial statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
(in thousands)
YEARS ENDED DECEMBER 31
-------------------------------------------------
1997 1996 1995
-------------- -------------- --------------
OPERATING ACTIVITIES
- --------------------
<S> <C> <C> <C>
Net income $ 45,874 $ 37,125 $ 38,748
Adjustments to reconcile net income to net cash
from operating activities:
Depreciation and amortization 5,275 4,231 4,346
Amortization of deferred policy acquisition costs 16,441 16,790 9,405
Policy acquisition costs deferred (36,117) (30,611) (20,954)
Interest credited to contract values 66,788 65,494 64,598
Amortization of discounts or premiums (1,747) (1,513) (1,630)
Net realized gains on investment transactions (10,295) (13,103) (4,471)
Deferred income taxes 39 (1,560) 694
Minority interest in earnings of subsidiary 1,987 1,259 -
Change in assets and liabilities:
Accrued investment income (10) (1,071) 1,088
Other assets (3,239) (1,372) (1,583)
Policy and contract reserves (3,446) 2,266 1,001
Policy and contract claims 6,047 2,538 (506)
Unearned policy charges (315) (2,141) (657)
Unearned reinsurance ceded allowance 511 373 103
Federal income taxes payable - current (7,977) 1,300 (1,698)
Dividends payable (183) (111) 100
Other liabilities 6,509 5,445 (911)
-------------- -------------- --------------
Net cash from operating activities 86,142 85,339 87,673
-------------- -------------- --------------
INVESTING ACTIVITIES
- --------------------
Purchase of investments:
Fixed maturity securities held to maturity (39,522) (122,182) (105,019)
Fixed maturity securities available for sale (115,864) (40,572) (40,468)
Equity securities (29,432) (19,925) (13,017)
Mortgage loans on real estate (56,251) (57,248) (28,841)
Real estate (1,676) (642) (589)
Short-term investments (2,124) (5,844) (14,884)
Other investments (6,026) (23,073) (12,569)
Proceeds from sale of investments:
Fixed maturity securities available for sale 16,419 4,774 2,919
Equity securities - unaffiliated 19,914 18,676 13,167
Equity securities - affiliated - 190 -
Real estate 1,723 951 737
Other investments 649 7,949 7,828
The accompanying notes to consolidated financial statements are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
(in thousands)
YEARS ENDED DECEMBER 31
-----------------------------------------------
1997 1996 1995
-------------- -------------- ------------
INVESTING ACTIVITIES (CONTINUED)
- --------------------------------
Proceeds from maturities or repayment of investments:
<S> <C> <C> <C>
Fixed maturity securities held to maturity $ 68,069 $ 71,317 $ 102,794
Fixed maturity securities available for sale 45,942 36,519 15,868
Mortgage loans on real estate 49,750 34,594 25,120
Real estate - - 219
Other investments 6,278 15,106 4,955
Short-term investments 3,050 16,571 4,022
Purchase of property and equipment (5,413) (3,711) (1,803)
Proceeds from sale of property and equipment 45 78 99
Net change in loans on insurance policies (2,622) 1,252 310
-------------- -------------- ------------
Net cash from investing activities (47,091) (65,220) (39,152)
-------------- -------------- ------------
FINANCING ACTIVITIES
- --------------------
Contribution for minority interest in subsidiary 1,530 22,445 -
Net change in accumulated contract values (34,584) (47,186) (17,286)
-------------- -------------- ------------
Net cash from financing activities (33,054) (24,741) (17,286)
-------------- -------------- ------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 5,997 (4,622) 31,235
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 77,142 81,764 50,529
-------------- -------------- ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 83,139 $ 77,142 $ 81,764
============== ============== ============
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income taxes $ 34,397 $ 27,748 $ 18,652
The accompanying notes to consolidated financial statements are an integral part of these statements.
</TABLE>
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
.
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ------------------------------------------------------------------------
NATURE OF OPERATIONS
Ameritas Life Insurance Corp. is a mutual life insurance company chartered by
the State of Nebraska. Its operations consist of life and health insurance and
annuity and pension contracts. The Company operates in the United States and,
including its subsidiaries, is authorized to do business in all 50 states and
the District of Columbia. Wholly owned insurance subsidiaries include First
Ameritas Life Insurance Corp. of New York and Pathmark Assurance Company. The
Company is also a 66% owner of AMAL Corporation (incorporated March 8, 1996),
which owns 100% of Ameritas Variable Life Insurance Company and Ameritas
Investment Corp. In addition to the insurance subsidiaries, the Company conducts
other diversified financial-service-related operations through the following
wholly owned subsidiaries: Veritas Corp. (a marketing organization for low-load
insurance products); Ameritas Investment Advisors, Inc. (an advisor providing
investment management services to the Company and other insurance companies);
and Ameritas Managed Dental Plan, Inc. (a prepaid dental organization).
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Ameritas Life
Insurance Corp. (Ameritas or the Company) and its majority-owned subsidiaries.
References to the Company relate to Ameritas and all subsidiaries. These
consolidated financial statements exclude the effects of all material
intercompany transactions.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
The principal accounting and reporting practices followed are:
INVESTMENTS
The Company classifies its securities into categories based upon the Company's
intent relative to the eventual disposition of the securities. The first
category, held to maturity securities, includes fixed maturity securities which
the Company has the positive intent and ability to hold to maturity. These
securities are carried at amortized cost. The second category, available for
sale securities, may be sold to address the liquidity and other needs of the
Company. Securities classified as available for sale are carried at fair value
on the balance sheet with unrealized gains and losses excluded from income and
reported as a separate component of equity net of related deferred acquisition
costs and income tax effects. The third category, trading securities, is for
debt and equity securities acquired for the purpose of selling them in the near
term. The Company has not classified any of its securities as trading
securities.
Equity securities (common stock and nonredeemable preferred stock) are valued at
fair value.
Mortgage loans on real estate are carried at amortized cost less an allowance
for estimated uncollectible amounts. SFAS No. 114, "Accounting by Creditors for
Impairment of a Loan," which was amended by SFAS No. 118, "Accounting by
Creditors for Impairment of a Loan - Income Recognition and Disclosures,"
requires that an impaired loan be measured at the present value of expected
future cash flows, or alternatively, the observable market price or the fair
value of the collateral. The Company adopted these standards as of January 1,
1995, with no material impact on its financial position or results of
operations.
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -----------------------------------------------------------------------
(CONTINUED)
- -----------
Investment real estate owned directly by the Company is carried at cost less
accumulated depreciation and allowances for estimated losses. Real estate
acquired through foreclosure is carried at the lower of cost or fair value minus
estimated costs to sell.
Other investments primarily include investments in venture capital partnerships
and real estate joint ventures accounted for using the equity method, and
securities owned by the broker dealer subsidiary valued at fair value. Changes
in the fair value of the securities owned by the broker dealer are included in
investment income.
Short-term investments are carried at amortized cost, which approximates fair
value.
Realized investment gains and losses on sales of securities are determined on
the specific identification method. Write-offs of investments that decline in
value below cost on other than a temporary basis and the change in the
allowances for mortgage loans and wholly owned real estate are included with
realized investment gains and losses in the consolidated statements of
operations.
The Company records write-offs or allowances for its investments based upon an
evaluation of specific problem investments. The Company reviews, on a continual
basis, all invested assets to identify investments where the Company may have
credit concerns. Investments with credit concerns include those the Company has
identified as experiencing a deterioration in financial condition.
CASH EQUIVALENTS
The Company considers all highly liquid debt securities purchased with a
remaining maturity of less than three months to be cash equivalents.
PROPERTY AND EQUIPMENT
Property and equipment are carried at cost less accumulated depreciation. The
Company provides for depreciation of property and equipment using straight-line
and accelerated methods over the estimated useful lives of the assets.
SEPARATE ACCOUNTS
The Company operates separate accounts on which the earnings or losses accrue
exclusively to contractholders. The assets (principally investments) and
liabilities of each account are clearly identifiable and distinguishable from
other assets and liabilities of the Company. The separate accounts are an
investment alternative for pension, variable life, and variable annuity products
which the Company markets. Amounts are reported at fair value.
PREMIUM REVENUE AND BENEFITS TO POLICYOWNERS
RECOGNITION OF PARTICIPATING AND TERM LIFE, ACCIDENT AND HEALTH AND ANNUITY
PREMIUM REVENUE AND BENEFITS TO POLICYOWNERS
Participating life insurance products include those products with fixed and
guaranteed premiums and benefits on which dividends are paid by the Company.
Premiums on participating and term life products and certain annuities with life
contingencies (immediate annuities) are recognized as premium revenue when due.
Accident and health insurance premiums are recognized as premium revenue over
the time period to which the premiums relate. Benefits and expenses are
associated with earned premiums so as to result in recognition of profits over
the premium-paying period of the contracts. This association is accomplished by
means of the provision for liabilities for future policy benefits and the
amortization of deferred policy acquisition costs.
RECOGNITION OF UNIVERSAL LIFE-TYPE CONTRACTS REVENUE AND BENEFITS TO
POLICYOWNERS
Universal life-type policies are insurance contracts with terms that are not
fixed and guaranteed. The terms that may be changed could include one or more of
the amounts assessed the policyowner, premiums paid by the policyowner or
interest accrued to policyowners' balances. Amounts received as payments for
such contracts are reflected as deposits and are not reported as premium
revenues.
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -------------------------------------------------------------------------
(CONTINUED)
- -----------
Revenues for universal life-type policies consist of charges assessed against
policy account values for deferred policy loading, mortality risk expense, the
cost of insurance and policy administration. Policy benefits and claims that are
charged to expense include interest credited to contracts and benefit claims
incurred in the period in excess of related policy account balances.
RECOGNITION OF INVESTMENT CONTRACT REVENUE AND BENEFITS TO POLICYOWNERS
Contracts that do not subject the Company to risks arising from policyowner
mortality or morbidity are referred to as investment contracts. Deposit
administration plans and certain deferred annuities are considered investment
contracts. Amounts received as payments for such contracts are reflected as
deposits and are not reported as premium revenues.
Revenues for investment products consist of investment income and policy
administration charges. Contract benefits that are charged to expense include
benefit claims incurred in the period in excess of related contract balances,
and interest credited to contract balances.
POLICY ACQUISITION COSTS
Those costs of acquiring new business, which vary with and are directly related
to the production of new business, have been deferred to the extent that such
costs are deemed recoverable from future premiums. Such costs include
commissions, certain costs of policy issuance and underwriting, and certain
agency expenses.
Costs deferred related to term life insurance are amortized over the
premium-paying period of the related policies, in proportion to the ratio of
annual premium revenues to total anticipated premium revenues. Such anticipated
premium revenues are estimated using the same assumptions used for computing
liabilities for future policy benefits.
Costs deferred related to participating life, universal life-type policies and
investment-type contracts are amortized generally over the lives of the
policies, in relation to the present value of estimated gross profits from
mortality, investment and expense margins. The estimated gross profits are
reviewed periodically based on actual experience and changes in assumptions.
A roll-forward of the amounts reflected in the consolidated balance sheets as
deferred policy acquisition costs is as follows:
<TABLE>
<CAPTION>
DECEMBER 31
-------------------------------------------
1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Beginning balance $ 146,405 $ 130,420 $ 126,619
Acquisition costs deferred 36,117 30,611 20,954
Amortization of deferred policy acquisition costs (16,441) (16,790) (9,405)
Adjustment for unrealized investment (gain)/loss (1,517) 2,164 (7,748)
- ------------------------------------------------------------------------------------------------------------------
Ending balance $ 164,564 $ 146,405 $ 130,420
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
To the extent that unrealized gains or losses on available for sale securities
would result in an adjustment of deferred policy acquisition costs had those
gains or losses actually been realized, the related unamortized deferred policy
acquisition costs are recorded as an adjustment of the unrealized investment
gains or losses included in policyowners' contingency reserves.
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ------------------------------------------------------------------------
(CONTINUED)
- -----------
FUTURE POLICY AND CONTRACT BENEFITS
Liabilities for future policy benefits for participating and term life contracts
and additional coverages offered under policy riders are calculated using the
net level premium method and assumptions as to investment yields, mortality,
withdrawals and dividends. The assumptions are based on projections of past
experience and include provisions for possible unfavorable deviation. These
assumptions are made at the time the contract is issued. These liabilities are
shown as policy and contract reserves.
Liabilities for future policy and contract benefits on universal life-type and
investment-type contracts are based on the policy account balance, and are shown
as accumulated contract values.
The liabilities for future policy and contract benefits for group disabled life
reserves and long-term disability reserves are based upon interest rate
assumptions and morbidity and termination rates from published tables, modified
for Company experience.
DIVIDENDS TO POLICYOWNERS
A portion of the Company's business has been issued on a participating basis.
The amount of policyowners' dividends to be paid is determined annually by the
Board of Directors.
INCOME TAXES
The Company, with the exception of AMAL and its subsidiaries, files a
consolidated life/non-life tax return. An agreement among the members of the
consolidated group provides for distribution of consolidated tax results as if
filed on a separate return basis. The provision for income taxes includes
amounts currently payable and deferred income taxes resulting from the
cumulative differences in assets and liabilities determined on a tax return and
financial statement basis at the current enacted tax rates.
RECLASSIFICATIONS
Certain items on the prior year financial statements have been restated to
conform to current year presentation.
2. INVESTMENTS
- ---------------
Investment income summarized by type of investment was as follows:
YEARS ENDED DECEMBER 31
----------------------------------------
1997 1996 1995
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Fixed maturity securities held to maturity $ 59,700 $ 59,366 $ 58,937
Fixed maturity securities available for sale 32,605 30,039 30,160
Equity securities 1,899 1,571 1,508
Mortgage loans on real estate 19,866 19,376 17,948
Real estate 12,317 9,699 9,644
Loans on insurance policies 4,341 4,265 4,290
Other investments 15,494 8,572 6,906
Short-term investments and cash and cash equivalents 4,266 5,069 5,083
- -------------------------------------------------------------------------------------------------------------------------
Gross investment income 150,488 137,957 134,476
Investment expenses 12,744 11,095 9,927
- -------------------------------------------------------------------------------------------------------------------------
Net investment income $ 137,744 $ 126,862 $ 124,549
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
2. INVESTMENTS (CONTINUED)
- ---------------------------
Net pretax realized investment gains (losses) were as follows:
YEARS ENDED DECEMBER 31
---------------------------------------
1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net gains (losses) on disposals, including calls, of investments
Fixed maturity securities held to maturity $ 1,059 $ 237 $ 2,944
Fixed maturity securities available for sale 494 802 175
Equity securities 6,787 11,439 1,131
Mortgage loans on real estate 959 66 138
Real estate 502 136 224
Other 564 503 (91)
- ------------------------------------------------------------------------------------------------------------------------
10,365 13,183 4,521
- ------------------------------------------------------------------------------------------------------------------------
Provisions for losses on investments
Mortgage loans on real estate (20) (80) (50)
Real estate (50) -- --
- ------------------------------------------------------------------------------------------------------------------------
Net pretax realized investment gains $ 10,295 $ 13,103 $ 4,471
- ------------------------------------------------------------------------------------------------------------------------
Proceeds from sales of securities and gross gains and losses realized on those sales were as follows:
YEAR ENDED DECEMBER 31, 1997
--------------------------------------
Proceeds Gains Losses
- ------------------------------------------------------------------------------------------------------------------------
Fixed maturity securities available for sale $ 16,419 $ 161 $ 8
Equity securities 19,914 7,725 938
- ------------------------------------------------------------------------------------------------------------------------
$ 36,333 $ 7,886 $ 946
- ------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1996
-------------------------------------
Proceeds Gains Losses
- ------------------------------------------------------------------------------------------------------------------------
Fixed maturity securities available for sale $ 4,774 $ 30 $ 247
Equity securities 18,676 11,796 357
- ------------------------------------------------------------------------------------------------------------------------
$ 23,450 $ 11,826 $ 604
- ------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1995
-------------------------------------
Proceeds Gains Losses
- ------------------------------------------------------------------------------------------------------------------------
Fixed maturity securities available for sale $ 2,919 $ -- $ 66
Equity securities 13,167 2,601 1,470
- ------------------------------------------------------------------------------------------------------------------------
$ 16,086 $ 2,601 $ 1,536
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
2. INVESTMENTS (CONTINUED)
- ---------------------------
The amortized cost and fair value of investments in securities by type of investment were as follows:
DECEMBER 31, 1997
------------------------------------------------------
GROSS UNREALIZED
AMORTIZED -------------------------- FAIR
COST GAINS LOSSES VALUE
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fixed maturity securities held to maturity
U.S. Corporate $ 448,344 $ 23,764 $ 423 $ 471,685
Mortgage-backed 147,741 6,523 14 154,250
U.S. Treasury securities and obligations of
U.S. government agencies 82,107 5,764 -- 87,871
Foreign 76,389 2,769 108 79,050
- -------------------------------------------------------------------------------------------------------------------------
Total fixed maturity securities held to maturity 754,581 38,820 545 792,856
- -------------------------------------------------------------------------------------------------------------------------
Fixed maturity securities available for sale
U.S. Corporate 282,265 11,742 280 293,727
Mortgage-backed 86,370 1,957 165 88,162
Asset-backed 7,997 169 -- 8,166
U.S. Treasury securities and obligations of
U.S. government agencies 67,342 3,455 242 70,555
Foreign 18,857 524 1 19,380
- -------------------------------------------------------------------------------------------------------------------------
Total fixed maturity securities available for sale 462,831 17,847 688 479,990
- -------------------------------------------------------------------------------------------------------------------------
Equity securities 59,383 49,893 532 108,744
Short-term investments 655 -- -- 655
- -------------------------------------------------------------------------------------------------------------------------
Total available for sale securities 522,869 67,740 1,220 589,389
- -------------------------------------------------------------------------------------------------------------------------
Total $ 1,277,450 $ 106,560 $ 1,765 $ 1,382,245
- -------------------------------------------------------------------------------------------------------------------------
The December 31, 1997, equity balance was increased by $16,557 (including an
increase in the carrying value of the securities of $27,152, decreased by $1,517
of related adjustments to deferred acquisition costs and $9,078 in deferred
income taxes) to reflect the net 1997 unrealized gain on securities classified
as available for sale previously carried at amortized cost.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
2. INVESTMENTS (CONTINUED)
- ---------------------------
DECEMBER 31, 1996
----------------------------------------------------
GROSS UNREALIZED
AMORTIZED -------------------------- FAIR
COST GAINS LOSSES VALUE
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fixed maturity securities held to maturity
U.S. Corporate $ 457,030 $ 17,953 $ 3,001 $ 471,982
Mortgage-backed 165,847 5,087 847 170,087
U.S. Treasury securities and obligations of
U.S. government agencies 84,418 3,611 249 87,780
Foreign 68,580 1,380 818 69,142
- ------------------------------------------------------------------------------------------------------------------------
Total fixed maturity securities held to maturity 775,875 28,031 4,915 798,991
- ------------------------------------------------------------------------------------------------------------------------
Fixed maturity securities available for sale
U.S. Corporate 241,022 7,944 2,780 246,186
Mortgage-backed 77,964 969 875 78,058
U.S. Treasury securities and obligations of
U.S. government agencies 70,627 2,765 1,023 72,369
Foreign 18,854 410 172 19,092
- ------------------------------------------------------------------------------------------------------------------------
Total fixed maturity securities available for sale 408,467 12,088 4,850 415,705
- ------------------------------------------------------------------------------------------------------------------------
Equity securities 43,079 33,236 1,100 75,215
Short-term investments 1,541 -- -- 1,541
- ------------------------------------------------------------------------------------------------------------------------
Total available for sale securities 453,087 45,324 5,950 492,461
- ------------------------------------------------------------------------------------------------------------------------
Total $ 1,228,962 $ 73,355 $ 10,865 $ 1,291,452
- ------------------------------------------------------------------------------------------------------------------------
The December 31, 1996, equity balance was decreased by $6,446 (including a
decrease in the carrying value of the securities of $12,246, increased by $2,164
of related adjustments to deferred acquisition costs and $3,636 in deferred
income taxes) to reflect the net 1996 unrealized gain on securities classified
as available for sale previously carried at amortized cost.
The amortized cost and fair value of fixed maturity securities by contractual
maturity at December 31, 1997, are shown below. Expected maturities will differ
from contractual maturities because borrowers may have the right to call or
prepay obligations with or without call or prepayment penalties.
AVAILABLE FOR SALE HELD TO MATURITY
---------------------------------------------------------------------
AMORTIZED FAIR AMORTIZED FAIR
COST VALUE COST VALUE
- -----------------------------------------------------------------------------------------------------------------------------------
Due in one year or less $ 22,495 $ 22,560 $ 15,437 $ 15,620
Due after one year through five years 122,517 127,006 122,983 128,111
Due after five years through ten years 169,090 174,075 327,442 343,013
Due after ten years 54,362 68,018 140,978 151,862
Mortgage-backed and asset-backed securities 94,367 88,331 147,741 154,250
- -----------------------------------------------------------------------------------------------------------------------------------
Total $ 462,831 $ 479,990 $ 754,581 $ 792,856
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
3. INCOME TAXES
- ----------------
The items that give rise to deferred tax assets and liabilities relate to the following:
YEARS ENDED DECEMBER 31
-----------------------------
1997 1996
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net unrealized investment gains $ 29,569 $ 20,116
Equity in subsidiaries 9,992 7,905
Deferred policy acquisition costs 47,713 43,247
Prepaid expenses 3,246 2,373
Other 2,327 2,234
- -------------------------------------------------------------------------------------------------------------------------
Gross deferred tax liability 92,847 75,875
- -------------------------------------------------------------------------------------------------------------------------
Future policy and contract benefits 30,593 24,386
Deferred future revenues 6,091 6,126
Policyowner dividends 3,547 3,610
Pension and postretirement benefits 2,715 2,643
Other 3,665 3,027
- -------------------------------------------------------------------------------------------------------------------------
Gross deferred tax asset 46,611 39,792
- -------------------------------------------------------------------------------------------------------------------------
Net deferred tax liability $ 46,236 $ 36,083
- -------------------------------------------------------------------------------------------------------------------------
The difference between the U.S. federal income tax rate and the consolidated tax provision rate is summarized as
follows:
YEARS ENDED DECEMBER 31
------------------------------------------
1997 1996 1995
- -------------------------------------------------------------------------------------------------------------------------
Federal statutory tax rate 35.0 % 35.0 % 35.0 %
Equity in subsidiaries 2.4 1.2 1.0
Surplus tax (2.7) 7.1 (5.2)
Other 0.9 (1.5) 0.5
- -------------------------------------------------------------------------------------------------------------------------
Effective tax rate 35.6 % 41.8 % 31.3 %
- -------------------------------------------------------------------------------------------------------------------------
The "surplus tax," IRC Section 809, is an imputation of income to mutual life
insurance companies according to a formula based on a comparison of the returns
of equity of the mutual and stock segments of the life insurance industry. The
Company's provision for its surplus tax is based on the Company's best estimate
of what its final surplus tax will be.
4. EMPLOYEE AND AGENT BENEFIT PLANS
- ------------------------------------
PENSION PLANS
The Company has a noncontributory defined benefit retirement plan covering
substantially all employees. Plan benefits are based on years of credited
service and the employee's compensation during the last five years of
employment. The Company's funding policy is to make contributions each year at
least equal to the minimum funding requirements for tax-qualified retirement
plans. Pension costs include current service costs, which are accrued and funded
on a current year basis, and past service costs, which are amortized over the
average remaining service life of all employees on the adoption date. The assets
of this plan are not segregated.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
4. EMPLOYEE AND AGENT BENEFIT PLANS (CONTINUED)
- ------------------------------------------------
Periodic pension expense for the Company included the following components:
YEARS ENDED DECEMBER 31
---------------------------------------------
1997 1996 1995
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Service cost - benefits earned during the year $ 1,408 $ 1,223 $ 1,349
Interest cost on projected benefit obligation 1,496 1,866 1,894
Actual return on plan assets (3,329) (2,817) (2,844)
Net amortization and deferral 1,836 932 1,148
- ---------------------------------------------------------------------------------------------------------------------------
Net periodic pension expense $ 1,411 $ 1,204 $ 1,547
- ---------------------------------------------------------------------------------------------------------------------------
The following table sets forth the funded status of the Company's plans:
DECEMBER 31
--------------------------------
1997 1996
- ---------------------------------------------------------------------------------------------------------------------------
Accumulated benefit obligation
Vested $ 15,184 $ 13,173
Nonvested 1,099 323
Effect of projected future compensation increases 6,949 5,761
- ---------------------------------------------------------------------------------------------------------------------------
Projected benefit obligation 23,232 19,257
Plan assets at fair value 24,271 20,153
- ---------------------------------------------------------------------------------------------------------------------------
Plan assets in excess of projected benefit obligation 1,039 896
Unrecognized net loss (875) (1,159)
Unrecognized transition obligation 1,236 1,331
- ---------------------------------------------------------------------------------------------------------------------------
Net pension asset $ 1,400 $ 1,068
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
The projected benefit obligation was determined using an assumed discount rate
of 7.25% and 7.5% for 1997 and 1996, respectively, and a weighted-average
assumed long-term rate of compensation increase of 4.5% for 1997 and 1996. The
assumed long-term rate of return on plan assets was 8.0% for 1997 and 1996.
The Company has generally funded annually the maximum allowed under IRS
regulations. The Company made contributions totaling $1,744 in 1997, $1,600 in
1996, and $1,500 in 1995.
The Company's employees and agents also participate in defined contribution
plans that cover substantially all full-time employees and agents. Company
contributions were $868 in 1997 and $800 in both 1996 and 1995.
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
The Company provides certain health care and life insurance benefits to retired
employees. These benefits are a specified percentage of premium until age 65 and
a flat dollar amount thereafter. Employees become eligible for these benefits
upon the attainment of age 55, 15 years of service and participation in the
Company medical plan for the immediately preceding five years.
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
4. EMPLOYEE AND AGENT BENEFIT PLANS (CONTINUED)
- ------------------------------------------------
The Company has adopted a 401(h) plan to fund its postretirement benefit
obligation. Funding of $425, $440 and $300 was made in 1997, 1996 and 1995,
respectively. The accumulated postretirement benefit obligation and the accrued
postretirement benefit liability were as follows:
DECEMBER 31
---------------------------
1997 1996
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Retirees $ 2,145 $ 2,451
Fully eligible active plan participants 462 396
Other active plan participants 1,891 1,899
- ------------------------------------------------------------------------------------------------------------------------
Accumulated postretirement benefit obligation 4,498 4,746
Plan assets (1,767) (1,252)
Unrecognized gain 1,516 1,040
- ------------------------------------------------------------------------------------------------------------------------
Accrued postretirement benefit liability $ 4,247 $ 4,534
- ------------------------------------------------------------------------------------------------------------------------
Net periodic postretirement benefit costs consisted of the following components:
YEARS ENDED DECEMBER 31
--------------------------------------------
1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------
Service costs $ 158 $ 177 $ 200
Interest cost on accumulated postretirement benefit plan 304 315 310
Net amortization and deferral (77) (35) (10)
Expected return on assets (89) (57) (34)
- -------------------------------------------------------------------------------------------------------------------------
Net periodic postretirement benefit costs $ 296 $ 400 $ 466
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
The assumed health care cost trend line rate used in measuring the accumulated
postretirement benefit obligation, for pre-65 employees, was 9.5% in 1995
decreasing linearly each successive year until it reaches 5.5% after 1999, after
which it remains constant. A one-percentage-point increase in the assumed health
care cost trend rate for each year would increase the accumulated postretirement
health care cost by approximately 3%, the current service cost by 7%, and
interest costs by 3%. The assumed discount rate used in determining the
accumulated postretirement benefit obligation was 7.25% and 7.5% in 1997 and
1996, respectively.
5. POLICYOWNERS' CONTINGENCY RESERVES
- --------------------------------------
STATUTORY SURPLUS AND NET INCOME
Net income of Ameritas and its insurance subsidiaries, as determined in
accordance with statutory accounting practices, was $47,200, $44,100 and $29,700
for 1997, 1996 and 1995, respectively. The Company's statutory surplus was
$311,300, $257,300 and $204,700 at December 31, 1997, 1996 and 1995,
respectively. The Company is required to maintain a certain level of
policyowners' contingency reserves to be in compliance with state laws and
regulations. Company policyowners' contingency reserves are monitored by state
regulators to ensure compliance with risk based capital requirements.
<PAGE>
<TABLE>
<CAPTION>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
6. REINSURANCE
- ---------------
In the ordinary course of business, the Company assumes and cedes reinsurance
with other insurers and reinsurers. These arrangements provide greater
diversification of business and limit the maximum net loss potential on large
risks.
The effect of reinsurance on premiums earned is as follows:
YEARS ENDED DECEMBER 31
-----------------------------------------------
1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Assumed $ 9,740 $ 6,344 $ 2,725
Ceded (10,777) (12,549) (8,284)
- ---------------------------------------------------------------------------------------------------------------------------------
$ (1,037) $ (6,205) $ (5,559)
- ---------------------------------------------------------------------------------------------------------------------------------
The Company remains contingently liable in the event that a reinsurer is unable
to meet the obligations ceded under the reinsurance agreement.
7. RESERVE FOR UNPAID CLAIMS
- -----------------------------
The change in the liability for unpaid accident and health claims and claim
adjustment expenses is summarized as follows:
1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------------
Balance at January 1 $ 17,957 $ 14,925 $ 15,383
Reinsurance reserves (net) (89) 121 (86)
- --------------------------------------------------------------------------------------------------------------------------------
17,868 15,046 15,297
- --------------------------------------------------------------------------------------------------------------------------------
Incurred related to:
Current year 132,940 117,610 119,116
Prior year (4,675) (2,051) (2,030)
- --------------------------------------------------------------------------------------------------------------------------------
Total incurred 128,265 115,559 117,086
- --------------------------------------------------------------------------------------------------------------------------------
Paid related to:
Current year 112,255 99,742 104,492
Prior year 13,193 12,995 12,845
- --------------------------------------------------------------------------------------------------------------------------------
Total paid 125,448 112,737 117,337
- --------------------------------------------------------------------------------------------------------------------------------
20,685 17,868 15,046
Reinsurance reserves (net) 1,748 89 (121)
- --------------------------------------------------------------------------------------------------------------------------------
Balance at December 31 $ 22,433 $ 17,957 $ 14,925
- ---------------------------------------------------------------------------------------------------------------------------------
The liability for unpaid accident and health claims and claim adjustment
expenses is included in policy and contract claims on the consolidated balance
sheets.
</TABLE>
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
8. COMMITMENTS AND CONTINGENCIES
- ---------------------------------
INVESTMENTS
Securities commitments of $25,848 and $16,935, and mortgage loan and real estate
commitments of $17,742 and $14,247 were outstanding for investments to be
purchased in subsequent years as of December 31, 1997 and 1996, respectively.
These commitments have been made in the normal course of investment operations
and are not reflected in the accompanying financial statements. The Company's
exposure to credit loss is represented by the contractual notional amount of
those instruments. The Company uses the same credit policies and collateral
requirements in making commitments and conditional obligations as it does for
on-balance sheet instruments.
STATE LIFE AND HEALTH GUARANTY FUNDS
As a condition of doing business, all states and jurisdictions have adopted laws
requiring membership in life and health insurance guaranty funds. Member
companies are subject to assessments each year based on life, health or annuity
premiums collected in the state. In some states these assessments may be applied
against premium taxes. The Company has estimated its costs related to past
insolvencies and has provided a reserve included in other liabilities of $2,325
and $2,250 as of December 31, 1997 and 1996, respectively.
LITIGATION
From time to time, the Company and its subsidiaries is subject to litigation in
the normal course of business. Management does not believe that the Company is
party to any such pending litigation which would have a material adverse effect
on its financial statements or future operations.
9. FAIR VALUE OF FINANCIAL INSTRUMENTS
- ---------------------------------------
The following disclosures are made regarding fair value information about
certain financial instruments for which it is practicable to estimate that
value. In cases where quoted market prices are not available, fair values are
based on estimates using present value or other valuation techniques. Those
techniques are significantly affected by the assumptions used, including the
discount rate and estimates of future cash flows. In that regard, the derived
fair value estimates, in many cases, could not be realized in immediate
settlement of the instrument. All nonfinancial instruments are excluded from
disclosure requirements. Accordingly, the aggregate fair value amounts presented
do not represent the underlying value of the Company.
The fair value estimates presented herein are based on pertinent information
available to management as of December 31, 1997 and 1996. Although management is
not aware of any factors that would significantly affect the estimated fair
value amounts, such amounts have not been comprehensively revalued for purposes
of these financial statements since that date; therefore, current estimates of
fair value may differ significantly from the amounts presented herein.
The following methods and assumptions were used by the Company in estimating its
fair value disclosures for each class of financial instrument for which it is
practicable to estimate a value:
FIXED MATURITY SECURITIES -- For publicly traded securities, fair value
is determined using an independent pricing source. For securities
without a readily ascertainable fair value, the value has been
determined using an interest rate spread matrix based upon quality,
weighted average maturity and Treasury yields.
EQUITY SECURITIES -- For publicly traded securities, fair value is
determined using prices from an independent pricing source.
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
9. FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)
- ---------------------------------------------------
LOANS ON INSURANCE POLICIES -- Fair values for loans on insurance
policies are estimated using a discounted cash flow analysis at
interest rates currently offered for similar loans. Loans on insurance
policies with similar characteristics are aggregated for purposes of
the calculations.
MORTGAGE LOANS ON REAL ESTATE -- Mortgage loans in good standing are
valued on the basis of discounted cash flow. The interest rate that is
assumed is based upon the weighted average term of the mortgage and
appropriate spread over Treasuries.
OTHER INVESTMENTS -- Fair values for venture capital partnerships are
estimated based on values as last reported by the partnership and
discounted for their lack of marketability. Real estate partnerships
are carried on the equity method and are excluded from the fair value
disclosure.
SHORT-TERM INVESTMENTS -- The carrying amount approximates fair value
because of the short maturity of these instruments.
CASH AND CASH EQUIVALENTS -- The carrying amounts equal fair value.
ACCRUED INVESTMENT INCOME -- Fair value equals book value.
ACCUMULATED CONTRACT VALUES -- Funds on deposit with a fixed maturity
are valued at discounted present value using market interest rates.
Funds on deposit which do not have fixed maturities are carried at the
amount payable on demand at the reporting date, which approximates fair
value.
COMMITMENTS -- The estimated fair value of commitments approximates
carrying value because the fees currently charged for these
arrangements and the underlying interest rates approximate market.
<TABLE>
<CAPTION>
Estimated fair values are as follows:
DECEMBER 31
----------------------------------------------------------------
1997 1996
----------------------------- ---------------------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Financial assets:
Fixed maturity securities
Held to maturity $ 754,581 $ 792,856 $ 775,875 $ 798,991
Available for sale 479,990 479,990 415,705 415,705
Equity securities 108,744 108,744 75,215 75,215
Loans on insurance policies 70,638 63,356 68,017 60,743
Mortgage Loans on real estate 228,709 240,583 226,776 234,750
Other investments 22,717 32,466 24,143 33,301
Short-term investments 655 655 1,541 1,541
Cash and cash equivalents 83,139 83,139 77,142 77,142
Accrued investment income 25,186 25,186 25,176 25,176
Financial liabilities:
Accumulated contract values excluding amounts
held under insurance contracts 764,505 764,998 756,029 756,194
</TABLE>
<PAGE>
AMERITAS LIFE INSURANCE CORP.
-----------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
----------------------------------------------------
(IN THOUSANDS)
(continued)
10. SUBSEQUENT EVENT
- --------------------
Effective January 1, 1998, the Company converted from a mutual insurance company
structure to a mutual insurance holding company structure pursuant to the
Nebraksa Mutual Insurance Holding Company Act. The conversion was approved by
the Nebraska State Department of Insurance and the policyowners of the mutual
company.
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
a) Financial Statements:
The financial statements of Ameritas Life Insurance Corp. Separate Account
LLVA and Ameritas Life Insurance Corp. are filed in Part B.
Ameritas Life Insurance Corp. Separate Account LLVA:
- Report of Deloitte & Touche LLP, independent auditors.
- Statement of Net Assets as of December 31, 1997.
- Statement of Operations for the year ended December 31, 1997
- Statement of Changes in Net Assets for the year ended December 31,
1997
- Notes to Financial Statements for the year ended December 31, 1997.
Ameritas Life Insurance Corp.:
- Report of Deloitte & Touche LLP, independent auditors.
- Consolidated Balance Sheets as of December 31, 1997 and 1996.
- Consolidated Statements of Operations for the years ended December 31,
1997, 1996 and 1995.
- Consolidated Statements of Equity for the years ended December 31, 1997,
1996 and 1995.
- Consolidated Statements of Cash Flows for the years ended December 31,
1997, 1996 and 1995.
- Notes to the Consolidated Financial Statements for the years ended
December 31, 1997, 1996 and 1995.
All schedules of Ameritas Life Insurance Corp. for which provision is made in
the applicable accounting regulations of the Securities and Exchange Commission
are not required under the related instructions, are inapplicable or have been
disclosed in the Notes to the Financial Statements and therefore have been
omitted.
There are no financial statements included in Part A.
<PAGE>
<TABLE>
<CAPTION>
b) Exhibits
Exhibit Number Description of Exhibit
-------------- ----------------------
<S> <C>
(1) Resolution of Board of Directors of Ameritas Life Insurance Corp.
establishing Ameritas Life Insurance Corp. Separate Account LLVA.*
(2) Not applicable.
(3)(a) Principal Underwriting Agreement.**
(3)(b) Form of Selling Agreement.*
(4) Form of Variable Annuity Contract.
(5) Form of Application for Variable Annuity Contract.***
(6)(a) Certificate of Incorporation of Ameritas Life Insurance Corp.*
(6)(b) Bylaws of Ameritas Life Insurance Corp.*
(7) Not applicable.
(8)(a) Participation Agreement.*
(8)(b) Proposed Participation Agreement.*
(8)(c) Proposed Participation Agreement**
(8)(d) Proposed Participation Agreement**
(9) Opinion and consent of Norman M. Krivosha.
(10)(a) Independent Auditors' Consent.
(11) No financial statements are omitted from Item 23.
(12) Not applicable.
(13) Not applicable.
* Incorporated by reference to the initial registration statement for Ameritas Life Insurance Corp. Separate Account
LLVA (File No. 333-5529), filed on June 7, 1996.
** Incorporated by reference to the Pre-Effective Amendment No. 1 for Ameritas Life Insurance Corp. Separate
Account LLVA (File No. 333-5529), filed on October 3, 1996.
*** Incorporated by reference to the Pre-Effective Amendment No. 2 for Ameritas Life Insurance Corp. Separate
Account (File No. 333-5529), filed on November 20, 1996.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Item 25. Directors and Officers of the Depositor.
<S> <C>
Name and Principal Position and Offices
Business Address with Depositor
---------------- --------------
Lawrence J. Arth* Director, Chairman of the Board
and Chief Executive Officer
Kenneth C. Louis* Director, President and Chief Operating Officer
Norman M. Krivosha* Executive Vice President, Secretary and
Corporate General Counsel
Jon C. Headrick* Executive Vice President-Investments
and Treasurer
James P. Abel** Director
Duane W. Acklie** Director
Robert C. Barth* Second Vice President and Assistant Controller
Eldon Bohmont* Second Vice President - Individual Client Services
Roxann Brennfoerder* Vice President - Pensions
Wayne E. Brewster* Vice President -Variable Sales
Robert W. Bush* Executive Vice President-Individual Insurance
Jan M. Connolly* Vice President - Corporate Operations, Planning and Quality
William W. Cook, Jr.** Director
Gerald B. Dimon* Vice President - Human Resources
Bert A. Getz** Director
William R. Giovanni* Senior Vice President and Chief Executive Officer -
Ameritas Investment Corp.
Lori S. Gohde* Vice President - Group Underwriting and Planning
James R. Haire* Vice President - Corporate Actuary
Thomas D. Higley* Vice President - Individual Financial Operations and Actuary
Leslie D. Inman* Vice President-Group Marketing and Training
Michael Jaskolka* Vice President - Information Services
Marty L. Johnson* Second Vice President - Individual Underwriting
Kenneth R. Jones* Vice President-Corporate Compliance and Assistant Secretary
James R. Knapp** Director
Robert F. Krohn** Director
William W. Lester* Vice President-Securities
Wilfred J. Maddux** Director
JoAnn M. Martin* Senior Vice President-Controller and
Chief Financial Officer
Anthony Mazzarelli, Jr.* Vice President - Individual Field Sales
Bruce R. McMullen, M.D.* Vice President and Medical Director
David C. Moore* Executive Vice President - Group and Pensions
William W. Nelson* Vice President - Group Administration and Claims
Dale K. Niebuhr* Second Vice President - Audit Services
Gary R. Raymond* Vice President - Group Actuary
3
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Barry C. Ritter* Senior Vice President - Information Services
Paul C. Schorr, III** Director
William C. Smith** Director
Donald R. Stading* Vice President and General Counsel - Insurance
and Assistant Secretary
Neal E. Tyner** Director
Kenneth L. VanCleave* Vice President - Group Managed Care and Partnering
Winston J. Wade** Director
Jon B. Weinberg* Vice President-Mortgage Loans and Real Estate
Steven L. Welton* Vice President-Individual Marketing
</TABLE>
* Principal business address: Ameritas Life Insurance Corp., 5900 "O" Street,
Lincoln, Nebraska 68510
** Principal address for: James P. Abel, NEBCO, Inc., P.O. Box 80268, Lincoln,
Nebraska 68501; Duane W. Acklie, Crete Carrier Corporation, P.O. Box 81228,
Lincoln, Nebraska 68501; William W. Cook, Jr., The Beatrice National Bank
and Trust Company, P.O. Box 100, Beatrice, Nebraska 68310; Bert A. Getz,
Globe Corporation, Scottsdale Spectrum, 6730 N. Scottsdale Road,
Suite 250, Scottsdale, Arizona 85253; James R. Knapp, The Brookhollow
Group, 535 Anton Boulevard, Suite 100, Costa Mesa, California 92626;
Robert F. Krohn, PSI Group, Inc., 10011 "J" Street, Omaha, Nebraska 68127;
Wilfred J. Maddux, Maddux Cattle Company, P.O. Box 217, Wauneta, Nebraska
69045; Paul C. Schorr, III, ComCor Holding, Inc., 6940 "O" Street, Suite
336, P.O. Box 57310, Lincoln, Nebraska 68505, William C. Smith, William C.
Smith & Co., Cornhusker Plaza, Suite 401, 301 So. 13th Street, Lincoln,
Nebraska 68508; Neal E. Tyner, NET Consultants, 6940 "O" Street, Suite 324,
Lincoln, Nebraska 68510; Winston J. Wade, c/o PMI-USW 843-1, P.O. Box 311,
Mendham, New Jersey 07945.
Item 26
The depositor, Ameritas Life Insurance Corp., is a stock life insurance company
domiciled in Nebraska. The Registrant is a segregated asset account of Ameritas
Life Insurance Corp.
The following chart indicates the persons controlled by or under common control
with Ameritas Life Insurance Corp.:
Omitted chart shows Ameritas organization: Ameritas Mutual Insurance Holding
Company is at the uppermost tier; Ameritas Holding Company is at the second
tier; ALIC with its separate accounts is at the third tier; fourth tier
companies are: Ameritas Investment Advisors, Inc., Ameritas Managed Dental
Plan, Inc., First Ameritas Life Insurance Corp. of New York, Pathmark Assurance
Company, Veritas Corp., and AMAL Corporation; fifth tier companies, which are
owned by AMAL Corporation, are Ameritas Investment Corp. and Ameritas Variable
Life Insurance Company with its separate accounts.
All entities are Nebraska entities, except First Ameritas Life Insurance Corp.
of New York, which is a New York entity, and Ameritas Managed Dental Plan, Inc.,
which is a California entity.
All entities are wholly owned by the person immediately controlling it, except
AMAL Corporation, a holding company, which is jointly owned by Ameritas Life
Insurance Corp., which owns a majority interest in AMAL Corporation, and AmerUs
Life Insurance Company, which owns a minority interest in AMAL Corporation.
AMAL Corporation is a holding company. Veritas is a marketing agency. Pathmark
Assurance Company is an insurance company.
4
<PAGE>
<TABLE>
<CAPTION>
Item 27. Number of Contractowners
As of December 31, 1997, there were 107 contractowners.
Item 28. Indemnification
Ameritas Life Insurance Corp.'s By-laws provide as follows:
"The Company shall indemnify any person who was, or is a party, or is
threatened to be made a party, to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative by
reason of the fact that such person is or was a director, officer or employee of
the Company or is or was serving at the request of the Company as a director,
officer or employee or agent of another corporation, partnership, joint venture,
trust, or other enterprise, against expenses including attorney's fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with such action, suit or proceeding to the full extent authorized
by the laws of Nebraska."
Section 21-2004 of the Nebraska Business Corporation Act, in general, allows
a corporation to indemnify any director, officer, employee or agent of the
corporation for amounts paid in settlement actually and reasonably incurred by
him or her in connection with an action, suit or proceeding, if he or she acted
in good faith and in a manner he or she reasonably believed to be in or not
opposed to the best interest of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful.
In a case of a derivative action, no indemnification shall be made in respect
of any claim, issue or matter as to which such person shall have been adjudged
to be liable for negligence or misconduct in the performance of his or her duty
to the corporation, unless a court in which the action was brought shall
determine that such person is fairly and reasonably entitled to indemnify for
such expenses which the Court shall deem proper.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
Item 29. Principal Underwriters
a) Ameritas Investment Corp. which will serve as the principal underwriter
for the variable annuity contracts issued through Ameritas Life Insurance
Corp. Separate Account LLVA, also serves as the principal underwriter for
variable life insurance contracts issued through Ameritas Life Insurance
Corp. Separate Account LLVL. Ameritas Investment Corp. also serves as the
principal underwriter for variable life insurance contracts issued
through Ameritas Variable Life Insurance Company Separate Account V, and
variable annuity contracts issued through Ameritas Variable Life
Insurance Company Separate Account VA-2.
b) The following table sets forth certain information regarding the officers
and directors of the principal underwriter, Ameritas Investment Corp.
Name and Principal Positions and Offices
Business Address with Underwriter
---------------- ----------------
<S> <C>
Lawrence J. Arth* Director and Chairman of the Board
Kenneth C. Louis* Director, Senior Vice President
Gary R. McPhail** Director, Senior Vice President
William R. Giovanni* Director, President and Chief Executive Officer
Thomas C. Godlasky** Director
Michael E. Sproule** Director
Billie B. Beavers*** Senior Vice President
Thomas C. Bittner* Vice President-Marketing and Administation
Alan R. Eveland* Vice President-Public Finance
James R. Fox*** Senior Vice President
Cynthia Susan Hahn* Vice President-Trading and Institutional Sales
Jon C. Headrick* Treasurer
Michael P. Heaton*** Senior Vice President
Kenneth R. Jones* Vice President-Corporate Compliance and Assistant Secretary
5
<PAGE>
<S> <C>
Norman M. Krivosha* Secretary and General Counsel
Bruce D. Lefler*** Vice President
Robert W. Morrow* Vice President
Michael VanHorne*** Senior Vice President
Janell D. Winsor* Vice President-Retail Sales Manager
* Principal business address: Ameritas Investment Corp., 5900 "O" Street, Lincoln, Nebraska 68510.
** Principal business address: AmerUs Life Insurance Company, 611 Fifth Avenue, Des Moines, Iowa 50309
*** Principal business address: Ameritas Investment Corp., 3337 North 107th Street, Omaha, Nebraska 68134
c)
Net Underwriting Compensation
Name of Principal Discounts and on Brokerage
Underwriter (1) Commissions (2) Redemption (3) Commissions (4) Compensation (5)
-------------------- --------------- -------------- --------------- ---------------
Ameritas Investment $4,145 $0 $0 $532
Corp.
</TABLE>
Item 30. Location of Separate Account and Records
The Books, records and other documents required to be maintained by Section
31(a) of the 1940 Act and Rules 31a- 1 to 31a-3 thereunder are maintained at
Ameritas Life Insurance Corp., 5900 "O" Street, Lincoln, Nebraska 68510.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
a) Registrant undertakes to file a post-effective amendment to this
registration statement as frequently as necessary to ensure that the
audited financial statements in the registration statement are never more
than 16 months old for so long as payments under the variable annuity
contracts may be accepted.
b) Registrant undertakes to include either (1) as part of any application to
purchase a contract offered by the prospectus, a space that an applicant
can check to request a Statement of Additional Information, or (2) a post
card or similar written communication affixed to or included in the
prospectus that the applicant can remove and send for a Statement of
Additional Information.
c) Registrant undertakes to deliver any Statement of Additional Information
and any financial statements required to be made available under this
form promptly upon written or oral request.
d) The Registrant is relying upon the Division of Investment Management
(Division) no-action letter of November 28, 1988 concerning annuities
sold in 403(b) plans and represents that the requirements of the
no-action letter have been, are and/or will be complied with.
e) Ameritas Life Insurance Corp. represents that the fees and charges
deducted under the contract, in the aggregate, are reasonable in relation
to the services rendered, the expenses expected to be incurred, and the
risks assumed by the insurance company.
6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: /S/Norman M. Krivosha By: /s/Lawrence J. Arth
------------------------ -----------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
/S/Lawrence J. Arth Director, Chairman of the Board February 20, 1998
- -------------------- and Chief Executive Officer
Lawrence J. Arth
/S/Kenneth C. Louis Director, President and February 20, 1998
- -------------------- Chief Operating Officer
Kenneth C. Louis
/S/Norman M. Krivosha Executive Vice President, Secretary February 20, 1998
- --------------------- and Corporate General Counsel
Norman M. Krivosha
/s/Jon C. Headrick Executive Vice President-Investments February 20, 1998
- ------------------- and Treasurer
Jon C. Headrick
/S/JoAnn M. Martin Senior Vice President-Controller February 20, 1998
- ------------------- and Chief Financial Officer
JoAnn M. Martin
- ------------------- Director February 20, 1998
James P. Abel
- --------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ------------------ Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------ Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
/S/James P. Abel Director February 20, 1998
- -----------------
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ------------------- Director February 20, 1998
James P. Abel
/s/Duane W. Acklie
- ------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
/s/William W. Cook Jr.
- ----------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ----------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
/s/Bert A. Getz
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
/s/James R. Knapp
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
/s/Robert F. Krohn
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
/s/Wilfred J. Maddux
- --------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
/s/Paul C. Schorr, III
- ---------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
/s/William C. Smith
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
/s/Neal E. Tyner
- ------------------ Director February 20, 1998
Neal E. Tyner
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Ameritas Life Insurance Corp. Separate Account LLVA, certifies that it meets all
the requirements of effectiveness of this Post-Effective Amendment No. 3 to the
Registration Statement pursuant to Rule 485(a) under the Securities Act of 1933
and has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned thereunto duly authorized in the City of Lincoln,
County of Lancaster, State of Nebraska on this 20th day of February, 1998.
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA, Registrant
AMERITAS LIFE INSURANCE CORP., Depositor
Attest: By:
----------------------- -----------------------------
Secretary Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Ameritas
Life Insurance Corp. on the dates indicated.
SIGNATURE TITLE DATE
- -------------------- Director, Chairman of the Board February 20, 1998
Lawrence J. Arth and Chief Executive Officer
- ------------------- Director, President and February 20, 1998
Kenneth C. Louis Chief Operating Officer
- -------------------- Executive Vice President, Secretary February 20, 1998
Norman M. Krivosha and Corporate General Counsel
- ------------------- Executive Vice President-Investments February 20, 1998
Jon C. Headrick and Treasurer
- -------------------- Senior Vice President-Controller February 20, 1998
JoAnn M. Martin and Chief Financial Officer
- ----------------- Director February 20, 1998
James P. Abel
- -------------------- Director February 20, 1998
Duane W. Acklie
- ---------------------- Director February 20, 1998
William W. Cook, Jr.
<PAGE>
SIGNATURE TITLE DATE
- ----------------- Director February 20, 1998
Bert A. Getz
- ------------------- Director February 20, 1998
James R. Knapp
- ------------------- Director February 20, 1998
Robert F. Krohn
- -------------------- Director February 20, 1998
Wilfred J. Maddux
- --------------------- Director February 20, 1998
Paul C. Schorr, III
- -------------------- Director February 20, 1998
William C. Smith
- ------------------- Director February 20, 1998
Neal E. Tyner
/s/Winston J. Wade
- ------------------- Director February 20, 1998
Winston J. Wade
<PAGE>
<PAGE>
As filed with the Securities and Exchange Commission on February 27, 1998
Registration No. 333-5529
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
EXHIBITS
TO
POST-EFFECTIVE AMENDMENT NO. 3
TO
FORM N-4
AMERITAS LIFE INSURANCE CORP.
SEPARATE ACCOUNT LLVA
<PAGE>
Exhibit Index
-------------
Exhibit Page
------- ----
99.4 Form of Variable Annuity Contract
99.9 Opinion and consent of Norman M. Krivosha
99.10(a) Independent Auditors' Consent
ANNUITANT FIELD (1)
POLICY NUMBER FIELD (3)
POLICY TYPE VARIABLE ANNUITY
Flexible Premium Deferred Variable Annuity Policy.
Annuity Payments Are Fixed and Begin On the Annuity Date.
Death Benefit Payable On The Annuitant's Death Prior
To The Annuity Date. Non-participating.
THIS POLICY'S ACCUMULATION VALUE IN THE SEPARATE ACCOUNT IS BASED ON THE
INVESTMENT EXPERIENCE OF THAT ACCOUNT AND MAY INCREASE OR DECREASE DAILY. IT IS
NOT GUARANTEED AS TO DOLLAR AMOUNT.
Ameritas Life Insurance Corp. agrees to pay the income, as described in this
policy, to the Annuitant if the Annuitant is living on the Annuity Date and if
this policy is then in force. A death benefit is payable upon death of the
Annuitant prior to the Annuity Date.
/s/ Kenneth C. Louis /s/ Norman M. Krivosha
President Secretary
"NOTICE OF TEN-DAY RIGHT TO EXAMINE POLICY"
You are urged to read this policy carefully. If, after examination, you are
dissatisfied with it for any reason, you may return it to the selling agent or
to Ameritas Life Insurance Corp. at One Ameritas Way, P.O. Box 82550, Lincoln,
Nebraska 68501-2550, within ten days from the date of delivery of the policy to
you. If allowed by state law, the amount of the refund will equal the greater of
premiums paid or the premiums paid adjusted by investment gains and losses.
Otherwise, the amount of the refund will be equal to the gross premiums paid.
Please read and carefully check the copy of the application attached to this
policy. This application is a part of your policy, and this policy was issued on
the basis that the answers to all questions and the information shown on this
application are true and complete. If any information shown on it is not true
and complete, to the best of your knowledge, please notify Ameritas Life
Insurance Corp. of Lincoln, Nebraska, within ten days from the date of delivery
of the policy to you.
AMERITAS LIFE INSURANCE CORP. LOGO
A STOCK COMPANY
<PAGE>
POLICY SCHEDULE
Annuitant: John D Specimen Policy Number: 1009006090
Issue Age - Sex: 35 Male Policy Date: April 15, 1996
Initial Premium: $5,000.00 Annuity Date: April 15, 2046
Owner: John D Specimen
Form 4080-1
<PAGE>
LIST OF SUBACCOUNTS AND PORTFOLIOS
Each subaccount of the Ameritas Life Insurance Corp. (ALIC) Separate Account
LLVA invests in a specific portfolio of the following funds:
Berger Institutional Products Trust (Berger IPT)
Neuberger & Berman Advisors Management Trust (Newberger & Berman AMT)
Strong Variable Insurance Funds, Inc.
Strong Opportunity Fund II, Inc.
(collectively Strong Funds)
FUND PORTFOLIO AND CORRESPONDING SUBACCOUNT
Berger IPT 100 Fund Subaccount
Small Company Growth Fund
Neuberger & Berman Liquid Asset
Limited Maturity Bond
Balanced
Partners
Growth
Strong Funds Growth Fund II
International Stock Fund II
Opportunity Fund II
Premiums may also be allocated to the ALIC Fixed Account.
INITIAL ALLOCATION OF NET PREMIUMS
Berger IPT 100 Fund Subaccount 0%
Small Company Growth Fund Subaccount 0%
Neuberger & Berman AMT Liquid Asset Subaccount 0%
Balanced Subaccount 50%
Limited Maturity Bond Subaccount 25%
Partners Subaccount 0%
Growth Subaccount 0%
Strong Funds Growth Fund II Subaccount 0%
International Stock Fund II Subaccount 0%
Opportunity Fund II Subaccount 25%
ALIC Fixed Account 0%
Form 4080 1.1
<PAGE>
ANNUAL POLICY FEE
Annual Policy Fee The maximum guaranteed Annual Policy Fee is $40.
In the first policy year, the current Annual Policy
Fee is $25.
The Annual Policy Fee is deducted on the last valuation date of the policy year
or at the time of a full withdrawal.
SCHEDULE OF MORTALITY AND EXPENSE RISK CHARGES
Daily Charge
Current .002049%*
Maximum Guaranteed .002596%**
* Equivalent to an annual rate of .75% of the average daily net assets of the
account.
** Equivalent to an annual rate of .95% of the average daily net assets of the
account.
Form 4080 1.2
<PAGE>
This page left intentionally blank.
<PAGE>
TABLE OF CONTENTS
SCHEDULE PAGES
INTRODUCTION
SECTION 1. DEFINITIONS
SECTION 2. GENERAL PROVISIONS
2.1 The Policy and Its Parts
2.2 Non-Participating
2.3 Contestability
2.4 Misstatement of Age or Sex
2.5 When This Policy Terminates
2.6 Annual Report
2.7 Postponement of Payments
SECTION 3. PREMIUM PAYMENTS
3.1 Initial Premium
3.2 Subsequent Unscheduled Premiums
3.3 Where to Pay Premiums
3.4 Allocation of Premiums
SECTION 4. THE OWNER AND THE BENEFICIARY
4.1 The Owner
4.2 The Annuitant's Beneficiary
4.3 Assigning the Policy
SECTION 5. SEPARATE ACCOUNT
5.1 The Separate Account
5.2 The Subaccounts
5.3 Valuation of Assets
5.4 Transfers Among Subaccounts and the Fixed
Account
5.5 The Funds
5.6 Portfolio Changes
SECTION 6. THE FIXED ACCOUNT
6.1 The Fixed Account
6.2 Transfers Among the Fixed Account and the
Subaccounts
Form 4080-2
<PAGE>
SECTION 7. VALUES
7.1 How Accumulation Value of the Policy is
Determined
7.2 Accumulation Value of the Subaccounts
7.3 Net Asset Value
7.4 Subaccount Unit Value
7.5 Accumulation Value of the Fixed Account
7.6 Interest Credits
7.7 Charges Under the Policy
SECTION 8. PARTIAL WITHDRAWALS AND SURRENDER
8.1 Partial Withdrawals
8.2 Surrender
SECTION 9. BENEFITS OF THIS ANNUITY POLICY
9.1 Annuity Benefits
9.2 Death Benefits
SECTION 10. DEATH OF THE OWNER
10.1 If You Die Prior to the Annuity Date
10.2 Special Spouse Rules
10.3 If You Die On or After the Annuity Date
SECTION 11. ANNUITY INCOME OPTIONS
11.1 Payment Option Rules
11.2 Description of Options
11.3 Basis of Payment
SECTION 12. NOTES ON OUR COMPUTATIONS
<PAGE>
INTRODUCTION
This is a flexible premium variable annuity policy. The accumulation value
varies according to the value of the Subaccounts plus the amounts held in the
Fixed Account. It will pay a monthly annuity payment for the life of the
Annuitant or for the period selected. Annuity payments do not vary according to
the value of the Subaccounts. Annuity payments start on the annuity date.
If the Annuitant dies before the annuity date, a death benefit will be paid to
the Annuitant's Beneficiary. If the Annuitant dies after the annuity date, any
unpaid payments certain will be paid to the Annuitant's Beneficiary. If the
Owner and Annuitant are different and the Owner should die prior to the annuity
date, certain provisions are required. See Section 10. The Owner and Annuitant
are named in the policy schedule pages.
SECTION 1. DEFINITIONS
Whenever used in this policy:
"Accumulation value" means the value of all amounts accumulated under the policy
prior to the annuity date.
"Annuitant" means the person upon whose life expectancy this policy is written.
The Annuitant may also be the Owner of this policy.
"Annuitant's Beneficiary" means the person to whom any benefits are due upon
the Annuitant's death.
"Annuity date" means the date on which annuity payments begin. It is shown in
the policy schedule pages.
"Annuity income option" means one of several ways in which annuity payments may
be made. The dollar amount of each annuity payment will not change over time,
unless the interest payment option is selected.
"Annuity payment" means one of a series of payments made under an annuity income
option.
"Death Benefit" is the amount payable to the Annuitant's Beneficiary should the
Annuitant die prior to the annuity date. It will be equal to the accumulation
value as of the date satisfactory proof of death is received, or the total
premiums paid less any previous partial withdrawals, whichever is greater.
However, this amount may be limited in accordance with the "Contestability"
provision. See Section 2.3.
"Fixed Account" is the account which consists of general account assets of
Ameritas Life Insurance Corp. which support annuity and insurance obligations.
"Funds" means the fund or funds available as funding vehicles on the policy
date, or as later changed by us and disclosed by the Prospectus. The Funds and
their respective portfolios which are available on the policy date are shown in
the policy schedule pages. The Funds have several portfolios. There is a
portfolio that corresponds to each of the Subaccounts of the Separate Account.
"Home Office" means our administrative office at One Ameritas Way, P.O.
Box 82550, Lincoln, Nebraska 68501-2550.
"Issue Date" means the date that all financial, contractual, and administrative
requirements have been completed and processed. The issue date will be shown on
the confirmation notice sent to you.
"Owner's Designated Beneficiary": If you and the Annuitant are not the same
individual, this is the person you may designate to take policy ownership upon
your death.
"Net Premium" means the premium payment less the premium tax, if imposed by the
state in which this policy is delivered.
"NYSE" means the New York Stock Exchange.
Form 4080-3
<PAGE>
"Policy date" means the date set forth in the policy that is the date used to
determine policy anniversary dates and policy years. The policy date is also
used to figure the start of the contestability period.
"Satisfactory proof of death" means all of the following submitted to the Home
Office: (1) a certified copy of the death certificate; (2) a Claimant Statement;
(3) the policy; and (4) any other information that we may require to establish
the validity of the policy.
"SEC" means the Securities and Exchange Commission.
"Separate Account" means the Separate Account identified in the policy schedule
pages. The Separate Account consists of assets set aside by us, the investment
performance of which is kept separate from that of our general assets.
"Subaccount" means that portion of the Separate Account which invests in shares
of mutual funds or any other investment portfolios which we determine to be
suitable for this policy's purposes.
"Valuation date" means each day on which the NYSE is open for trading.
"Valuation period" means the period between two successive valuation dates,
commencing at the close of trading on the NYSE on one valuation date and ending
at the close of trading on the NYSE on the next succeeding valuation date.
"We", "us", and "our" means Ameritas Life Insurance Corp.
"You" and "your" means the Owner of this policy.
SECTION 2. GENERAL PROVISIONS
2.1 THE POLICY AND ITS PARTS
This policy is a legal contract between you and us. It is issued in return for
the application and payment in advance of the premiums shown in the schedule
pages. The policy, application, any supplemental applications, endorsements,
riders and amendments are the entire contract. No change in this policy will be
valid unless it is in writing, attached to this policy, and approved by one of
our officers. We reserve the right to make any modification to conform the
policy to, or to give the Owner the benefit of, any federal or state statute or
any rule or regulation thereunder. No agent may change this policy or waive any
of its provisions.
2.2 NON-PARTICIPATING
This policy is non-participating. In other words, no dividends will be paid
under this policy.
2.3 CONTESTABILITY
Unless there has been a misstatement of the age or sex of the Annuitant, we
cannot contest the validity of this policy after the policy date.
2.4 MISSTATEMENT OF AGE OR SEX
If the age or sex of the Annuitant has been misstated, we will adjust the
benefits and amounts payable under this policy.
(1) If we made any overpayments, we will add interest at the rate of 6% per
year compounded yearly and charge them against payments to be made in the
future.
(2) If we made any underpayments, the balance plus interest at the rate of 6%
per year compounded yearly will be paid in a lump sum.
<PAGE>
2.5 WHEN THIS POLICY TERMINATES
This policy will terminate on the earliest of these conditions: (a) you
surrender the full accumulation value; (b) you die and any accumulation value
due has been paid; (c) the Annuitant dies and any death benefit due has been
paid; or (d) annuity income option payments being made cease.
2.6 ANNUAL REPORT
Within 30 days after each policy anniversary, we will mail you an annual report
that shows the progress of the policy. It will show the accumulation value as of
the policy anniversary. The report will also show any premiums paid and charges
made during the policy year. You may ask for a report like this at any time. We
have a right to charge a fee for each report other than the report we send out
once a year.
2.7 POSTPONEMENT OF PAYMENTS
We will usually pay any amounts payable from the Separate Account as a result of
a surrender or a partial withdrawal within seven (7) days after we receive your
written request in our Home Office in a form satisfactory to us. We can postpone
such payments or any transfers of amounts between Subaccounts or into the Fixed
Account if:
(1) NYSE is closed other than customary weekend and holiday closings or
trading on the NYSE is restricted as determined by the SEC; or
(2) the SEC by order permits the postponement for the protection of owners;
or
(3) an emergency exists as determined by the SEC, as a result of which
disposal of securities is not reasonably practicable, or it is not
reasonably practicable to determine the value of the net assets of the
Separate Account.
We may defer the payment of a surrender or a partial withdrawal from the Fixed
Account for up to six months from the date we receive your written request.
SECTION 3. PREMIUM PAYMENTS
3.1 INITIAL PREMIUM
The initial premium for the policy is shown in the schedule pages.
3.2 SUBSEQUENT UNSCHEDULED PREMIUMS
All premiums after the initial premium may be paid at any time. Except for the
initial premium payments, no premiums must be paid to keep this policy in force.
However, we reserve the right to limit the number of premium payments in any
calendar year. You can decide the amount of each premium, however we reserve the
right not to accept any payment of less than $250. We will also not accept total
premiums of more than $1 million under all annuity contracts issued by us having
the same Annuitant, without our prior approval.
3.3 WHERE TO PAY PREMIUMS
Each premium after the initial premium is payable at our Home Office. Upon
request, a receipt signed by our Secretary or an Assistant Secretary will be
given for any premium payment.
3.4 ALLOCATION OF PREMIUMS
On the issue date, we will allocate premiums to the Money Market Subaccount. As
of the 13th calendar day after the issue date, the accumulation value is
allocated to the Subaccounts or to the Fixed Account in accordance with the
allocations you have selected.
Any subsequent premiums will be allocated in accordance with your instructions.
You may change the allocation of later premiums without charge. The allocation
will apply to future premiums after we receive the change. The Separate Account,
Subaccounts and Fixed Account are described in Sections 5 and 6.
Form 4080-4
<PAGE>
SECTION 4. THE OWNER AND THE BENEFICIARY
4.1 THE OWNER
While the Annuitant is living, you have all the benefits, rights and privileges
under this policy. These include naming the Owner's Designated Beneficiary,
changing the Annuitant's Beneficiary, assigning this policy, enjoying all the
policy benefits, and exercising all policy options.
If you are not the Annuitant, you should name your designated beneficiary who
will become the Owner if you die before the Annuitant. If you die before the
Annuitant and there is no Owner's Designated Beneficiary, ownership will pass to
your estate.
4.2 THE ANNUITANT'S BENEFICIARY
The Annuitant's Beneficiaries will receive the death benefit, if any, upon the
Annuitant's death. You can name primary and contingent beneficiaries. Your
original beneficiary choice is shown in the attached application. You may change
the beneficiary during the Annuitant's lifetime. We do not limit the number of
changes that may be made. To make the change, we must receive a completed Change
of Beneficiary form and any other forms required by the Home Office. The change
will take effect as of the date we record it at the Home Office, even if the
Annuitant dies before we do so. We will not be liable for any payment made or
action taken before the change is recorded in our Home Office.
4.3 ASSIGNING THE POLICY
You may assign this policy. For an assignment to bind us, we must receive a
signed copy in the Home Office. We are not responsible for the validity of any
assignment.
SECTION 5. SEPARATE ACCOUNT
5.1 THE SEPARATE ACCOUNT
The Ameritas Life Insurance Corp. Separate Account LLVA ("Separate Account") is
a unit investment trust registered with the SEC under the Investment Company Act
of 1940. It is also subject to the laws of Nebraska. We own the assets of the
Separate Account and keep them separate from the assets of our general account.
The assets of the Separate Account will be available to cover the liabilities of
our general account only to the extent that the assets of the Separate Account
exceed the liabilities of the Separate Account arising under the variable
annuity policies supported by the Separate Account.
If we deem it to be in the best interests of owners, and subject to any
approvals that may be required under applicable law: (1) The Separate Account
may be operated as a management company under the Investment Company Act of
1940, or (2) it may be deregistered under that Act if registration is no longer
required, or (3) it may be combined with other separate accounts. To the extent
permitted by law, we may also transfer the assets of the Separate Account
associated with the policies to another Separate Account.
5.2 THE SUBACCOUNTS
The Separate Account has several Subaccounts. We list them in the schedule
pages. You determine, using percentages, how the premium will be allocated among
the Subaccounts. You may choose to allocate nothing to a particular Subaccount.
Any allocation you make must be at least 10%. You may not choose a fractional
percent. The allocations to the Subaccounts along with allocations to the Fixed
Account must total 100%. The assets of each Subaccount will be used to buy
shares in a corresponding portfolio of the funding vehicles designated in the
policy schedule pages. (See Section 5.5, "The Funds"). Income and realized and
unrealized gains or losses from the assets of each Subaccount of the Separate
Account are credited to or charged against that Subaccount without regard to
income, gains or losses in the other Subaccounts of
<PAGE>
the Separate Account, in our general account or in any other separate accounts.
We reserve the right to establish additional Subaccounts, each of which would
invest in shares of the Funds or in shares of another funding vehicle. We may
establish new Subaccounts or eliminate one or more Subaccounts if marketing
needs, tax considerations or investment conditions warrant. Any new Subaccounts
may be made available to existing owners on a basis to be determined by us.
5.3 VALUATION OF ASSETS
We will determine the value of the assets of each Subaccount at the close of
trading on the NYSE on each valuation date.
5.4 TRANSFERS AMONG SUBACCOUNTS AND THE FIXED ACCOUNT
You may transfer amounts among Subaccounts and into the Fixed Account as often
as you wish in a policy year. The transfer will take effect at the end of the
valuation period during which the transfer request is received at our Home
Office.
The first 15 transfers per policy year between the Subaccounts and/or the Fixed
Account will be allowed free of charge. Thereafter, a $10 charge may be deducted
from the amount transferred.
Each transfer must be for a minimum of $250 or the balance in the Subaccount, if
less. The minimum amount which can remain in a Subaccount as a result of a
transfer is $100. Any amount below this minimum will be included in the amount
transferred.
Transfers may be subject to additional restrictions by the Funds.
5.5 THE FUNDS
The word Fund or Funds, where we use it in this policy without qualification,
means the funding vehicles designated in the policy schedule pages. The Funds
bear their own expenses. The Funds may have several portfolios; there is a
portfolio that corresponds to each of the Subaccounts of the Separate Account.
We list these portfolios in the schedule pages.
5.6 PORTFOLIO CHANGES
A portfolio of a Fund might, in our judgment, become unsuitable for investment
by a Subaccount. This might happen because of a change in investment policy,
because of a change in laws or regulations, because the shares are no longer
available for investment, or for some other reason. If that occurs, we have the
right to substitute another portfolio of the Fund, or to invest in another fund.
We would first notify the SEC and, where required, seek approval from the
insurance department of the state where this policy is delivered. You will be
notified of any material change in the investment policy of any portfolio in
which you have an interest.
SECTION 6. THE FIXED ACCOUNT
6.1 THE FIXED ACCOUNT
Net premiums allocated to and transfers to the Fixed Account under the policy
become part of the general account assets of Ameritas Life Insurance Corp. which
support annuity and insurance obligations. The Fixed Account includes all of
Ameritas Life Insurance Corp.'s assets, except those assets segregated in
separate accounts. Ameritas Life Insurance Corp. maintains the sole discretion
to invest the assets of the Fixed Account, subject to applicable law.
You determine, using percentages, how the net premium will be allocated to the
Fixed Account. You may choose to allocate nothing to the Fixed Account. The
minimum allocation must be at least 10%; you may not choose a fractional
percent. The allocations to the Fixed Account along with allocations to the
Subaccounts must total 100%.
Form 4080-5
<PAGE>
6.2 TRANSFERS AMONG THE FIXED ACCOUNT AND THE SUBACCOUNTS
You may transfer into the Fixed Account from the Subaccounts at any time during
the policy year.
You may make one transfer out of the Fixed Account to any of the other
Subaccounts only during the 30 day period following each policy anniversary.
----
The allowable transfer amount out of the Fixed Account is limited to the greater
of:
1. 25% of the Fixed Account balance; or
2. any Fixed Account transfer which occurred during the prior 13 months; or
3. $1,000.
Transfers into or from the Fixed Account will be subject to the same minimums
and charges that are applied to transfers among the Subaccounts.
SECTION 7. VALUES
7.1 HOW ACCUMULATION VALUE OF THE POLICY IS DETERMINED
The accumulation value of the policy on the issue date is equal to the initial
premium received, reduced by applicable premium taxes.
The accumulation value of this policy on a valuation date is equal to the total
of the values in each Subaccount and the Fixed Account, plus any net premium
received on that valuation date but not yet allocated.
7.2 ACCUMULATION VALUE OF THE SUBACCOUNTS
To compute the accumulation value held in the Subaccounts on any valuation date,
we multiply each Subaccount's unit value (defined in Section 7.4 below) by the
number of Subaccount units allocated to the policy.
The number of Subaccount units will increase when:
a. Net premiums are credited to that Subaccount; or
b. Transfers from other Subaccounts or the Fixed Account are credited
to that Subaccount.
The number of Subaccount units will decrease when:
a. A partial withdrawal is taken from that Subaccount; or
b. A transfer, and its charge, is made from that Subaccount to other
Subaccounts or the Fixed Account; or
c. We deduct the annual policy fee when due.
Each transaction above will increase or decrease the number of Subaccount units
allocated to the policy by an amount equal to the dollar value of the
transaction divided by the unit value as of the valuation date of the change.
7.3 NET ASSET VALUE
The net asset value of the shares of each portfolio of the Fund is determined
once daily as of the close of business of the New York Stock Exchange on days
when the Exchange is open for business. The net asset value is determined by
adding the values of all securities and other assets of the portfolio,
subtracting liabilities and expenses and dividing by the number of outstanding
shares of the portfolio. Expenses, including the investment advisory fee payable
to the Investment Advisor, are accrued daily.
7.4 SUBACCOUNT UNIT VALUE
For each Subaccount, the value of an accumulation unit (unit value) was set when
the Subaccount was established. The unit value of each Subaccount reflects the
investment performance of that Subaccount. The unit value may increase or
decrease from one valuation date to the next.
<PAGE>
The unit value of each Subaccount on any valuation date shall be calculated as
follows:
a. The per share net asset value of the corresponding Fund portfolio
on the valuation date times the number of shares held by the
Subaccount, before the purchase or redemption of any shares on that
date; minus
b. A charge not exceeding an annual rate of .95% times the value of
the assets of each subaccount on the valuation date for mortality
and expense risk; divided by
c. The total number of units held in the Subaccount on the valuation
date before the purchase or redemption of any units on that date.
When transactions are made, the actual dollar amounts are converted to
accumulation units. The number of accumulation units for a transaction is found
by dividing the dollar amount of the transaction by the unit value as of the
valuation date.
7.5 ACCUMULATION VALUE OF THE FIXED ACCOUNT
The accumulation value of the Fixed Account on a valuation date is equal to:
a. The preceding month's ending value: plus
b. The net premiums credited to the Fixed Account; plus
c. Any transfers from the Subaccounts credited to the Fixed Account;
minus
d. Any partial withdrawals taken from the Fixed Account; minus
e. Any transfers and their charges made from the Fixed Account; plus
f. Interest credits, minus
g. Any annual policy fee due.
7.6 INTEREST CREDITS
We guarantee that the accumulation value in the Fixed Account will be credited
with an effective annual interest rate of at least 3%. We may, at our
discretion, credit a higher current rate of interest.
7.7 CHARGES UNDER THE POLICY
The following charges are deducted under the policy:
(1) Annual Policy Fee - an annual charge, equal to the amount listed in the
schedule pages, is deducted from the accumulation value on the last
valuation date of each policy year or upon a surrender, if between
policy anniversaries. The charge will be deducted from the Subaccounts
and the Fixed Accounts in the same proportion as the balances held in the
Subaccounts and the Fixed Accounts.
(2) Taxes - where imposed by state law upon the receipt of a premium payment,
a charge will be made on the date of the payment. If imposed upon
surrender or annuitization, a charge equal to the amount due will be
deducted prior to surrender or annuitization. We reserve the right to
charge for state or local taxes or for federal income tax, if any taxes
become attributable to the Separate Account. If any tax should become
applicable to this policy, you will be advised of the amount of such tax
and its effect upon any payments made.
(3) Mortality and Expense Risk Charge - a daily charge shown in the schedule
pages. This charge is deducted from the Subaccounts only and not from the
Fixed Account.
SECTION 8. PARTIAL WITHDRAWALS AND SURRENDER
You may request a partial withdrawal or surrender this policy at any time before
the annuity date. Any amount payable due to a partial withdrawal or surrender
will be paid to you in a lump sum unless you elect to be paid under an annuity
income option.
8.1 PARTIAL WITHDRAWALS
Partial withdrawals can be categorized as either "elective" or "systematic".
Elective partial withdrawals must be elected by you. Systematic
Form 4080-6
<PAGE>
partial withdrawals can be made automatically after the initial allocation date.
You may elect systematic withdrawals in accordance with our rules. Payouts under
a systematic withdrawal may be on monthly, quarterly, semi-annual or annual
mode.
All partial withdrawals, elective and systematic, are subject to the following
rules:
a. The minimum partial withdrawal amount is $250.
b. The accumulation value remaining after a partial withdrawal
must be at least $1,000.
c. Request for withdrawal must be made in writing, on a form
approved by us.
d. A partial withdrawal is considered irrevocable.
8.2 SURRENDER
If you elect to surrender this policy, the amount payable is the accumulation
value reduced by the annual policy fee. The accumulation value is determined as
of the date we receive your written request to surrender the policy.
SECTION 9. BENEFITS OF THIS ANNUITY POLICY
This section describes the annuity benefits and how they work. It also describes
what happens if the Annuitant dies.
9.1 ANNUITY BENEFITS
This policy will pay a monthly annuity payment to the Annuitant for the life of
the Annuitant. The payments start on the annuity date. The amount of the monthly
annuity payment is based on the accumulation value as of the annuity date and
the annuity income option elected by you.
When Annuity Payments Start
1. Annuity payments start on the annuity date. The normal annuity date is the
later of:
a. the policy anniversary nearest the Annuitant's 85th birthday; or
b. the fifth policy anniversary.
2. You may change the annuity date, either advance or defer it, subject to the
following:
a. Your request must be in writing and received by us at least 30 days in
advance.
b. The annuity date may only be changed during the lifetime of the
Annuitant and prior to the annuity date.
c. You may not defer the annuity date to a date beyond the policy
anniversary nearest the Annuitant's 95th birthday.
How Annuity Payments are Made
1. Frequency - Annuity payments are made monthly starting on the annuity date.
2. Minimum Amount - The minimum amount of annuity payment we will make is $100.
If the annuity payment amount is less than $100, we have the right to pay
the accumulation value in a lump sum or to change the frequency.
3. Proof - We may require proof of the Annuitant's age before making the first
annuity payment. From time to time, we may require proof that the Annuitant
is living.
4. Options - Subject to the above, you decide how the annuity payments should
be paid. You have a choice of certain payment options. These are called
annuity income options and are described
<PAGE>
in Section 11. If you do not choose an option, we will make the annuity payments
according to Annuity Income Option c, Life Annuity.
You may elect an option or may change the option subject to the following. The
election or change:
a. Must be in writing and approved by us.
b. Must be made while the Annuitant is living.
c. Must be made prior to and at least 30 days in advance of the annuity
date.
9.2 DEATH BENEFITS
Death of the Annuitant Prior to the Annuity Date
If the Annuitant dies prior to the annuity date, we will pay the death benefit
to the Annuitant's Beneficiary.
1. Amount - The death benefit is calculated as of the date we receive at the
Home Office satisfactory proof of death. The amount of the death benefit
will equal the greater of:
a. The accumulation value; or
b. Total premiums paid less any previous partial withdrawals.
2. Payment - The death benefit will be paid as a lump sum cash benefit unless
you elect an annuity income option for the beneficiary. If you do not elect
an annuity income option and a cash benefit has not already been made, the
Annuitant's Beneficiary may make this election after the Annuitant's death.
Death of the Annuitant On or After the Annuity Date
If the Annuitant dies on or after the annuity date, the remaining portion of any
unpaid annuity benefits due will be paid to the Annuitant's Beneficiary based on
the annuity income option in effect at the time of death.
SECTION 10. DEATH OF THE OWNER
REQUIRED DISTRIBUTIONS UNDER IRC 72(S)
Unless otherwise specified, this Section assumes that the Annuitant and Owner
are not the same person.
10.1 IF YOU DIE PRIOR TO THE ANNUITY DATE
If you die prior to the annuity date, ownership of this policy will pass to the
Owner's Designated Beneficiary. If you have not named an Owner's Designated
Beneficiary, ownership will pass to your estate.
Section 72(s) of the Internal Revenue Code has special rules regarding the
distribution of the accumulation value of this policy if you, the Owner, die
before the annuity date. We will calculate the accumulation value as of the date
we receive at the Home Office a written request for distribution from the
Owner's Designated Beneficiary. For purposes of this Section only, this amount
will be called the distribution amount.
Under Section 72(s), the entire distribution amount must be distributed for tax
purposes within five years of your death. However, Section 72(s) will allow
distribution over a period longer than five years but only if all of the
following conditions are met:
1. You have named an Owner's Designated Beneficiary.
2. The Owner's Designated Beneficiary is an individual person or persons.
3. The Owner's Designated Beneficiary takes the distribution amount as an
annuity payable to himself or herself or for his or her benefit.
4. The first payment of the annuity is to be paid to the Owner's Designated
Beneficiary within one year of your death or such later date as prescribed
by federal regulations.
Form 4080-7
<PAGE>
5. The entire distribution amount must be paid out over the lifetime of the
Owner's Designated Beneficiary or over a period not extending beyond his or
her life expectancy.
Also for purposes of Section 72(s) of the Internal Revenue Code, if the Owner of
the policy is not an individual, death of the Annuitant shall be treated as
death of the Owner.
10.2 SPECIAL SPOUSE RULES
If your spouse is named as the Owner's Designated Beneficiary, or in those cases
where you are both the Owner and the Annuitant and your spouse is named the
Annuitant's Beneficiary, the special distribution rules of Section 72(s)
described above will apply by treating your spouse as the original Owner of the
policy. Your spouse may elect to continue the policy in force until the earlier
of their death or the annuity date.
10.3 IF YOU DIE ON OR AFTER THE ANNUITY DATE
If you die on or after the annuity date, annuity benefits continue to be paid to
the Annuitant under the annuity income option in effect on your date of death.
SECTION 11. ANNUITY INCOME OPTIONS
11.1 PAYMENT OPTION RULES
All or part of the accumulation value may be placed under one or more annuity
income options. If annuity payments are to be paid under more than one option,
we must be told what part of the accumulation value is to be paid under each
option. The annuity income option must be made by written request and received
by us at least 30 days in advance of the annuity date. If no election is made,
payments will be made as an annuity under Option c, Life Annuity. Subject to our
approval, you may select any other annuity income option we then offer. Annuity
income options are not available to: (1) an assignee; or (2) any other than a
natural person except with our consent.
11.2 DESCRIPTION OF OPTIONS
Annuity income options aii., b., c. and d. are offered as fixed annuity options.
This means that the amount of each annuity payment will be set on the annuity
date and will not change.
ANNUITY INCOME OPTIONS:
ai. Interest Payment - We will hold any amount applied under this option.
Interest on the unpaid balance will be paid or credited each month at a rate
determined by us.
aii.Designated Amount Annuity - Monthly annuity payments will be for an agreed
fixed amount. Payments continue until the amount we hold runs out.
b. Designated Period Annuity - Monthly annuity payments are paid for a period
certain as elected up to 20 years.
c. Life Annuity - Monthly annuity payments are paid for the life of an
Annuitant, ceasing with the last annuity payment due prior to his or her
death. Variations provide for payments to be guaranteed to continue beyond
the lifetime of that person for a fixed period of time. One variation
assures that at least the original amount is returned in benefits (cash
refund). However, under all options, payments will continue as long as the
named person is alive.
d. Joint and Last Survivor Annuity - Monthly annuity payments are paid based on
the lives of two annuitants. Benefits cease with the last annuity payment
due prior to the survivor's death.
11.3 BASIS OF PAYMENT
The rate of interest payable under option ai, aii, and b will be guaranteed at
3% compounded yearly. Payments under option c and d will be based on a 3.5%
interest rate combined with the 1983 Table "a" Individual Annuity Table,
projected 17 years.
We may, at the time of election of an annuity income option, offer more
favorable rates in lieu of the guaranteed rates specified in the Annuity Tables.
<PAGE>
SECTION 12. NOTES ON OUR COMPUTATIONS
We have filed a detailed statement of method we use to compute policy values and
benefits with the state where this policy was delivered. The accumulation values
and the death benefit of this policy are not less than those required by the
laws of that state. Accumulation values and reserves are calculated in
accordance with the Standard Non-Forfeiture and Valuation Laws of the state in
which this policy is delivered.
Form 4080-8
<PAGE>
<TABLE>
<CAPTION>
TABLES OF SETTLEMENT OPTIONS
TABLE B (OPTION b) TABLE D (OPTION d)
Monthly Installments for Monthly Installments for each $1,000 of Net Proceeds
each $1,000 of net proceeds
Male & Male & Male & Male& Male&
Years Monthly Years Monthly Age Female Age Female Age Female Age Female Age Female
- ------------------------------- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 84.47 11 8.86 40 3.16 50 3.50 60 4.05 70 5.07 80 7.08
2 42.86 12 8.24 41 3.19 51 3.54 61 4.13 71 5.21 81 7.37
3 28.99 13 7.71 42 3.22 52 3.59 62 4.21 72 5.36 82 7.69
4 22.06 14 7.26 43 3.25 53 3.63 63 4.29 73 5.53 83 8.03
5 17.91 15 6.87 44 3.28 54 3.68 64 4.38 74 5.70 84 8.40
- ------------------------------- ---------------------------------------------------------------------------
6 15.14 16 6.53 45 3.31 55 3.74 65 4.48 75 5.89 85 8.79
7 13.16 17 6.23 46 3.34 56 3.79 66 4.58 76 6.10
8 11.68 18 5.96 47 3.38 57 3.85 67 4.69 77 6.32
9 10.53 19 5.73 48 3.42 58 3.92 68 4.81 78 6.55
10 9.61 20 5.51 49 3.46 59 3.98 69 4.93 79 6.81
- --------------------------------- -----------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Income for payments other than monthly will be furnished by the Home Office upon request.
Table D values for combinations of ages not shown and values for 2 males or 2 females will be furnished by the Home Office upon
request.
TABLE C (OPTION C) Monthly Installments for each $1,000 of Net Proceeds
MALE FEMALE
- ----------------------------------------------------- -------------------------------------------------------
LIFE MONTHS CERTAIN CASH LIFE MONTHS CERTAIN CASH
AGE ONLY 60 120 180 240 REF. AGE ONLY 60 120 180 240 REF.
- ----------------------------------------------------- -------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
40 3.54 3.54 3.53 3.52 3.50 3.46 40 3.33 3.33 3.33 3.32 3.31 3.29
41 3.58 3.58 3.57 3.56 3.54 3.50 41 3.36 3.36 3.36 3.36 3.35 3.32
42 3.63 3.63 3.62 3.60 3.57 3.54 42 3.40 3.40 3.40 3.39 3.38 3.36
43 3.68 3.67 3.66 3.64 3.62 3.58 43 3.44 3.44 3.43 3.43 3.41 3.39
44 3.73 3.72 3.71 3.69 3.66 3.62 44 3.48 3.48 3.47 3.46 3.45 3.42
- ----------------------------------------------------- ------------------------------------------------------
45 3.78 3.77 3.76 3.74 3.70 3.66 45 3.52 3.52 3.51 3.50 3.49 3.46
46 3.83 3.83 3.81 3.79 3.75 3.70 46 3.56 3.56 3.55 3.54 3.53 3.50
47 3.89 3.89 3.87 3.84 3.80 3.75 47 3.61 3.60 3.60 3.59 3.57 3.54
48 3.95 3.94 3.93 3.89 3.85 3.80 48 3.65 3.65 3.65 3.63 3.61 3.58
49 4.01 4.01 3.99 3.95 3.90 3.85 49 3.70 3.70 3.69 3.68 3.66 3.62
- ----------------------------------------------------- ------------------------------------------------------
50 4.08 4.07 4.05 4.01 3.95 3.90 50 3.76 3.75 3.75 3.73 3.70 3.67
51 4.15 4.14 4.11 4.07 4.00 3.96 51 3.81 3.81 3.80 3.78 3.75 3.72
52 4.22 4.21 4.18 4.13 4.06 4.02 52 3.87 3.87 3.86 3.83 3.80 3.76
53 4.30 4.29 4.26 4.20 4.12 4.08 53 3.93 3.93 3.91 3.89 3.85 3.82
54 4.38 4.37 4.33 4.27 4.18 4.14 54 4.00 3.99 3.98 3.95 3.91 3.87
- ----------------------------------------------------- ------------------------------------------------------
55 4.47 4.45 4.41 4.34 4.24 4.21 55 4.06 4.06 4.04 4.01 3.96 3.93
56 4.56 4.54 4.50 4.42 4.30 4.28 56 4.14 4.13 4.11 4.08 4.02 3.99
57 4.65 4.64 4.59 4.50 4.36 4.35 57 4.21 4.21 4.19 4.14 4.08 4.05
58 4.75 4.74 4.68 4.58 4.43 4.42 58 4.29 4.29 4.26 4.22 4.14 4.12
59 4.86 4.84 4.78 4.66 4.49 4.50 59 4.38 4.37 4.34 4.29 4.21 4.18
- ----------------------------------------------------- ------------------------------------------------------
60 4.98 4.96 4.88 4.75 4.56 4.59 60 4.47 4.46 4.43 4.37 4.28 4.26
61 5.10 5.08 4.99 4.84 4.62 4.67 61 4.57 4.56 4.52 4.45 4.34 4.33
62 5.23 5.20 5.11 4.93 4.69 4.77 62 4.67 4.66 4.62 4.54 4.41 4.41
63 5.38 5.34 5.23 5.03 4.76 4.86 63 4.78 4.77 4.72 4.63 4.48 4.50
64 5.53 5.49 5.35 5.13 4.82 4.96 64 4.90 4.88 4.82 4.72 4.56 4.58
- ----------------------------------------------------- ------------------------------------------------------
65 5.69 5.64 5.49 5.23 4.88 5.07 65 5.02 5.00 4.94 4.82 4.63 4.68
66 5.86 5.80 5.63 5.33 4.95 5.18 66 5.16 5.13 5.06 4.92 4.70 4.78
67 6.04 5.98 5.77 5.43 5.01 5.29 67 5.30 5.27 5.18 5.02 4.77 4.88
68 6.24 6.16 5.92 5.53 5.06 5.41 68 5.45 5.42 5.32 5.13 4.85 4.99
69 6.45 6.36 6.07 5.64 5.12 5.54 69 5.61 5.58 5.46 5.23 4.92 5.10
- ----------------------------------------------------- ------------------------------------------------------
70 6.67 6.56 6.23 5.74 5.17 5.67 70 5.79 5.75 5.60 5.35 4.98 5.22
71 6.91 6.78 6.40 5.84 5.21 5.81 71 5.98 5.93 5.76 5.46 5.05 5.35
72 7.16 7.01 6.57 5.93 5.26 5.96 72 6.19 6.13 5.92 5.57 5.11 5.49
73 7.43 7.25 6.74 6.03 5.30 6.11 73 6.41 6.34 6.10 5.69 5.17 5.63
74 7.72 7.51 6.91 6.12 5.33 6.27 74 6.66 6.56 6.27 5.80 5.22 5.78
- ----------------------------------------------------- ------------------------------------------------------
75 8.03 7.77 7.09 6.20 5.36 6.44 75 6.92 6.81 6.46 5.91 5.27 5.94
76 8.36 8.06 7.26 6.28 5.39 6.62 76 7.20 7.06 6.65 6.02 5.31 6.11
77 8.71 8.35 7.44 6.36 5.42 6.81 77 7.50 7.34 6.85 6.12 5.35 6.29
78 9.09 8.67 7.62 6.43 5.44 7.00 78 7.83 7.63 7.04 6.22 5.38 6.48
79 9.50 8.99 7.79 6.50 5.45 7.21 79 8.18 7.94 7.25 6.31 5.41 6.67
- ----------------------------------------------------- ------------------------------------------------------
80 9.93 9.33 7.96 6.56 5.47 7.43 80 8.56 8.27 7.45 6.39 5.43 6.88
81 10.40 9.68 8.12 6.61 5.48 7.65 81 8.98 8.62 7.65 6.47 5.45 7.11
82 10.89 10.05 8.28 6.66 5.49 7.89 82 9.43 8.99 7.85 6.54 5.47 7.34
83 11.42 10.42 8.43 6.70 5.50 8.15 83 9.92 9.37 8.04 6.60 5.48 7.58
84 11.98 10.80 8.58 6.74 5.50 8.41 84 10.45 9.78 8.22 6.65 5.49 7.84
85 12.58 11.19 8.71 6.77 5.51 8.69 85 11.02 10.20 8.39 6.70 5.50 8.12
- ----------------------------------------------------- ---------------------------------------------------------
Income for payments other than monthly will be furnished by the Home Office upon request.
Table C values for ages below 40 and above 85, and values for 300 and 360 months certain will be furnished by the Home Office
upon request.
Form 4080-9
</TABLE>
<PAGE>
Form 4080 Flexible Premium Deferred Variable Annuity Policy
Norman Krivosha Ameritas Life Insurance Corp. Logo
Executive Vice President
Secretary and Corporate General Counsel
- --------------------------------------------------------------------------------
One Ameritas Way/P.O. Box 81889/Lincoln, NE 68501-1889/(402) 467-7176
February 27, 1998
Ameritas Life Insurance Corp.
5900 "O" Street
Lincoln, Nebraska 68501
Gentlemen:
With reference to Post-Effective Amendment No. 3 to the Registration Statement
on Form N-4, filed by Ameritas Life Insurance Corp. and Ameritas Life Insurance
Corp. Separate Account LLVA with the Securities & Exchange Commission covering
flexible premium variable annuity policies, I have examined such documents and
such laws as I considered necessary and appropriate, and on the basis of such
examination, it is my opinion that:
1. Ameritas Life Insurance Corp. is duly organized and validly existing
under the laws of the State of Nebraska and has been duly authorized by
the Insurance Department of the State of Nebraska to issue variable
annuity policies.
2. Ameritas Life Insurance Corp. Separate Account LLVA is a duly
authorized and existing separate account established pursuant to the
provisions of Sections 44-310.06 (subsequently repealed) and/or
44-402.01 of the Statutes of the State of Nebraska.
3. The flexible premium variable annuity policies, when issued as
contemplated by said Form N-4 Registration Statement, will constitute
legal, validly issued and binding obligations of Ameritas Life
Insurance Corp.
I hereby consent to the filing of this opinion as an exhibit to said
Post-Effective Amendment No. 3 to the Registration Statement on Form N-4 and to
the use of my name under the caption "Legal Matters" in the Prospectus contained
in the Registration Statement.
Sincerely,
/s/Norman Krivosha
Norman Krivosha
Executive Vice President, Secretary
and Corporate General Counsel
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Post Effective Amendment No. 3 to Registration
Statement No. 333-5529 of Ameritas Life Insurance Corp. Separate Account LLVA on
Form N-4 of our reports dated February 2, 1998, on the financial statements of
Ameritas Life Insurance Corp. and Ameritas Life Insurance Corp. Separate Account
LLVA, appearing in the Statement of Additional Information, which is a part of
such Registration Statement, and to the reference to us under the heading
"Experts" in such Statement of Additional Information.
/s/ Deloitte & Touche LLP
Lincoln, Nebraska
February 26, 1997
