<PAGE>
EXHIBIT (10)(b)
OPINION AND CONSENT OF ACTUARY
<PAGE>
[PFL Life Insurance Company Letterhead]
June 1, 2000
PFL Life Insurance Company
4333 Edgewood Road NE
Cedar Rapids, Iowa 52499-0001
Re: Privilege Select Variable Annuity
PFL Life Variable Annuity Account E
Registration on Form N-4; SEC File No. 333-32110
Dear Sir/Madam:
With regard to the above registration statement, I have examined such documents
and made such inquiries as I have deemed necessary and appropriate, and on the
basis of such examination, have the following opinions:
Fees and charges deducted under the Privilege Select Variable Annuity policies
are those deemed necessary to appropriately reflect:
(1) the expenses incurred in the acquisition and distribution of the
policies,
(2) the expenses associated with the development and servicing of the
policies,
(3) the assumption of certain risks arising from the operation and management
of the policies and/or riders to the policy and that provides for a
reasonable margin of profit.
Fees and charges assessed against the policy values in the variable account
include:
(i) Service Charge and Administrative Charge
(ii) Mortality and Expense Risk Fee (M&E)
(iii) Taxes (including premium and other taxes if applicable)
The magnitude of each of the individual charges listed above in (i) through
(iii) is established in the pricing of the Privilege Select Variable Annuity, to
achieve a reasonable Return on Investment (ROI), which is within the range of
industry practice with respect to comparable variable annuity products.
<PAGE>
Except by coincidence, it is not expected that actual charges assessed in a
given year would exactly offset actual expenses incurred. Acquisition expenses
(as well as major product and/or systems development expenses) are incurred "up
front" and recovered, with a reasonable profit margin, through future years'
charges. In addition, the company cannot increase certain charges under the
policies in the pricing process.
Therefore, in my opinion, the fees and charges deducted under the policies, in
the aggregate, are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by the company.
I hereby consent to the use of this opinion, which is included as an Exhibit to
the registration statement.
/s/ Calvin R. Birkey
-----------------------------
Calvin R. Birkey, FSA, MAAA
Managing Actuary
PFL Life Insurance Company
