<PAGE>
As filed with the Securities and Exchange Commission on July 8, 1997
Registration Nos. 333-26341
811-08205
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. 1 [X]
Post-Effective Amendment No.__ [ ]
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 1 [X]
FIRST INVESTORS LIFE VARIABLE ANNUITY FUND D
(Exact Name of Registrant)
FIRST INVESTORS LIFE INSURANCE COMPANY
(Name of Depositor)
95 Wall Street, 22nd Floor, New York, New York 10005
(Address of Depositor's Principal Executive Offices)
(212) 858-8200
(Depositor's Telephone Number, including Area Code)
Richard H. Gaebler, President
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street, 22nd Floor
New York, New York 10005
(Name and Address of Agent for Service)
Copies of all communications to:
Freedman, Levy, Kroll & Simonds
1050 Connecticut Avenue
Washington, D.C. 20036-5366
Attn: Gary O. Cohen, Esq.
<PAGE>
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.
The Registrant has registered an indefinite number or amount of its securities
under the Securities Act of 1933 pursuant to Rule 24f-2 under the Investment
Company Act of 1940. The securities being registered are units of interest
under variable annuity contracts. The Registrant intends to file a Rule 24f-2
Notice by March 2, 1998.
Registrant hereby amends this Registration Statement on such date or dates as
may be necessary to delay its effective date until Registrant shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
<PAGE>
FIRST INVESTORS LIFE VARIABLE ANNUITY FUND D
CROSS-REFERENCE SHEET
<TABLE>
<CAPTION>
N-4 Item No. Location
- ------------ --------
PART A: PROSPECTUS
<S> <C>
1. Cover Page . . . . . . . . . . . . . . . . . . . . . . Cover Page
2. Definitions. . . . . . . . . . . . . . . . . . . . . . Glossary of Special Terms
3. Synopsis . . . . . . . . . . . . . . . . . . . . . . . Fee Table
4. Condensed Financial Information. . . . . . . . . . . . Not Applicable
5. General Description of Registrant, Depositor, and
Portfolio Companies. . . . . . . . . . . . . . . . . . General Descriptions
6. Deductions . . . . . . . . . . . . . . . . . . . . . . Purchases, Charges and Expenses
7. General Description of Variable Annuity
Contracts . . . . . . . . . . . . . . . . . . . . . . Variable Annuity Contracts
8. Annuity Period . . . . . . . . . . . . . . . . . . . . Variable Annuity Contracts
9. Death Benefit. . . . . . . . . . . . . . . . . . . . . Variable Annuity Contracts
10. Purchases and Contract Value.. . . . . . . . . . . . . Purchases, Charges and
Expenses;
Variable Annuity Contracts
11. Redemptions. . . . . . . . . . . . . . . . . . . . . . Variable Annuity Contracts
12. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . Federal Income Tax Status
13. Legal Proceedings. . . . . . . . . . . . . . . . . . . Not Applicable
14. Table of Contents of the Statement of
Additional Information . . . . . . . . . . . . . . . . Table of Contents of the Statement
of Additional Information
PART B: STATEMENT OF ADDITIONAL INFORMATION
15. Cover Page.. . . . . . . . . . . . . . . . . . . . . . Cover Page
16. Table of Contents. . . . . . . . . . . . . . . . . . . Table of Contents
17 General Information and History. . . . . . . . . . . . General Description; Other
Information
18. Services . . . . . . . . . . . . . . . . . . . . . . . Services
19. Purchase of Securities Being Offered.. . . . . . . . . Not Applicable
20. Underwriters . . . . . . . . . . . . . . . . . . . . . Services
21. Calculation of Performance Data. . . . . . . . . . . . Performance Information
22. Annuity Payments . . . . . . . . . . . . . . . . . . . Annuity Payments
23. Financial Statements . . . . . . . . . . . . . . . . . Relevance of Financial Statements;
Financial Statements
</TABLE>
<PAGE>
FIRST INVESTORS LIFE VARIABLE ANNUITY FUND D
INDIVIDUAL VARIABLE ANNUITY CONTRACTS
OFFERED BY
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street, New York, New York 10005/(212) 858-8200
This Prospectus describes Variable Annuity Contracts (the "Contracts")
offered by First Investors Life Insurance Company ("First Investors Life"). The
Contracts are designed for individual investors who desire to accumulate capital
on a tax-deferred basis for retirement or other long-term purposes. The
Contracts may be purchased on a nonqualified basis. The Contracts may also be
purchased through (1) qualified individual retirement accounts and (2) qualified
corporate employee pension and profit-sharing plans. The Contracts offered are
flexible premium deferred variable annuity contracts ("Deferred Variable Annuity
Contracts") under which annuity payments will begin on a selected future date.
A PENALTY MAY BE ASSESSED ON EARLY WITHDRAWALS (SEE "FEDERAL INCOME TAX
STATUS"). THE CONTRACTS CONTAIN A 10-DAY REVOCATION RIGHT (SEE "VARIABLE
ANNUITY CONTRACTS--TEN-DAY REVOCATION RIGHT"). The Contracts provide for the
accumulation of values on a variable basis. Payment of annuity benefits will be
on a variable basis, unless a fixed basis or a combination of variable and fixed
bases is selected by the Contractowner. Unless otherwise stated, this
Prospectus describes only the variable aspects of the Contracts. The Contracts
contain information on the fixed aspects.
Contractowners' purchase payments are paid into a unit investment trust,
First Investors Life Variable Annuity Fund D ("Separate Account D"). A
Contractowner elects to have his or her purchase payments paid into any one or
more of the eleven subaccounts of Separate Account D (the "Subaccounts"). The
assets of each Subaccount are invested at net asset value in shares of the
related series of First Investors Life Series Fund (the "Life Series Fund"), an
open-end, diversified management investment company.
This Prospectus sets forth the information about Separate Account D that a
prospective investor should know before investing and should be kept for future
reference. A Statement of Additional Information, dated ________ 1997, has been
filed with the Securities and Exchange Commission and is incorporated herein by
reference in its entirety. (See page 23 of this Prospectus for the Table of
Contents of the Statement of Additional Information.) The Statement of
Additional Information is available at no charge upon request to First Investors
Life at the address or telephone number indicated above. Additional information
about Separate Account D has been filed with the Securities and Exchange
Commission.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS IS VALID ONLY WHEN ATTACHED TO THE CURRENT
PROSPECTUS OF FIRST INVESTORS LIFE SERIES FUND.
The date of this Prospectus is _________, 1997
1
<PAGE>
GLOSSARY OF SPECIAL TERMS
ACCUMULATED VALUE - The value of all the Accumulation Units credited to
the Contract.
ACCUMULATION PERIOD - The period between the date of issue of a Contract
and the Annuity Commencement Date.
ACCUMULATION UNIT - A unit used to measure the value of a
Contractowner's interest in a Subaccount of Separate Account D prior to the
Annuity Commencement Date.
ADDITIONAL PAYMENT - A purchase payment made to First Investors Life
after issuance of a deferred annuity.
ANNUITANT - The person designated to receive or the person who is
actually receiving annuity payments under a Contract.
ANNUITY COMMENCEMENT DATE - The date on which annuity payments are to
commence.
ANNUITY UNIT - A unit used to determine the amount of each annuity
payment after the first.
BENEFICIARY - The person designated to receive any benefits under a
Contract upon the death of the Annuitant in accordance with the terms of the
Contract.
CONTRACT - An individual variable annuity contract offered by this
Prospectus.
CONTRACTOWNER - The person or entity with legal rights of ownership of the
Contract.
FIXED ANNUITY - An annuity with annuity payments which remain fixed as to
dollar amount throughout the payment period.
GENERAL ACCOUNT - All assets of First Investors Life other than those
allocated to Separate Account D and other segregated investment accounts of
First Investors Life.
JOINT ANNUITANT - The designated second person under joint and survivor
life annuity.
SEPARATE ACCOUNT D - The segregated investment account entitled "First
Investors Life Variable Annuity Fund D," established by First Investors Life
pursuant to applicable law and registered as a unit investment trust under
the Investment Company Act of 1940, as amended.
SINGLE PAYMENT - A one-time purchase payment made to First Investors Life
to purchase a deferred annuity.
SUBACCOUNT - A segregated investment subaccount under Separate Account D
which corresponds to a series of the Life Series Fund. The assets of the
Subaccount are invested in shares of the corresponding series of the Life
Series Fund.
VALUATION DATE - Any date on which the New York Stock Exchange ("NYSE")
is open for regular trading. Each Valuation Date ends as of the close of
regular trading on the NYSE (normally 4:00 p.m., Eastern Time). The NYSE
currently observes the following holidays: New Year's Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.
VALUATION PERIOD - The period beginning on the date after any Valuation
Date and ending at the end of the next Valuation Date.
VARIABLE ANNUITY - An annuity with annuity payments varying in amount in
accordance with the net investment experience of the Subaccounts.
2
<PAGE>
FEE TABLE
The following table has been prepared to assist the investor in
understanding the various costs and expenses a Contractowner will directly or
indirectly bear. The table reflects expenses of Separate Account D as well as
the series (each a "Fund" and collectively "Funds") of the Life Series Fund.
The Fee Table reflects Fund expenses expected to be incurred in 1997.
<TABLE>
CONTRACTOWNER TRANSACTION EXPENSES
<S> <C>
Sales Load Imposed on Purchases (as a percentage of purchase payments). . . . . None
Maximum Contingent Deferred Sales Charge. . . . . . . . . . . . . . . . . . . . 7.00%*
ANNUAL CONTRACT MAINTENANCE CHARGE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $30.00Y
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average account value)
Mortality and Expense Risk Charges. . . . . . . . . . . . . . . . . . . . . . . 1.25%
Administrative Charge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15%
-----
Total Separate Account Annual Expenses. . . . . . . . . . . . . . . . . . . . . 1.40%
<CAPTION>
FUND ANNUAL EXPENSES
(as a percentage of Fund average net assets)
TOTAL FUND
MANAGEMENT OTHER OPERATING
FEES(1) EXPENSES(2) EXPENSES(3)
---------- ----------- -----------
<S> <C> <C> <C>
Blue Chip Fund . . . . . . . . . . . . . . . . . . . . 0.75% 0.09% 0.84%
Cash Management Fund . . . . . . . . . . . . . . . . . 0.60+ 0.10+ 0.70+
Discovery Fund . . . . . . . . . . . . . . . . . . . . 0.75 0.10 0.85
Government Fund. . . . . . . . . . . . . . . . . . . . 0.60+ -0-+ 0.60+
Growth Fund. . . . . . . . . . . . . . . . . . . . . . 0.75 0.10 0.85
High Yield Fund. . . . . . . . . . . . . . . . . . . . 0.75 0.10 0.85
International Securities Fund. . . . . . . . . . . . . 0.75 0.37 1.12
Investment Grade Fund. . . . . . . . . . . . . . . . . 0.60+ -0-+ 0.60+
Target Maturity 2007 Fund. . . . . . . . . . . . . . . 0.60+ -0-+ 0.60+
Target Maturity 2010 Fund. . . . . . . . . . . . . . . 0.60+ -0-+ 0.60+
Utilities Income Fund. . . . . . . . . . . . . . . . . 0.60+ 0.11 0.71+
</TABLE>
- ------------------------------
* The Maximum Contingent Deferred Sales Charge is a percentage of the value of
the Accumulation Units surrendered (not to exceed the aggregate amount of the
purchase payments made for such Units). It decreases 1% each year so that there
is no charge after 7 years. Each year up to 10% of total purchase payments may
be surrendered without a contingent deferred sales charge. Additional purchase
payments do not cause the contingent deferred sales charge percentages to start
over on prior purchase payments.
Y The Contract Maintenance Charge of $30 will be deducted from the Accumulated
Value, provided that in no case will this charge exceed 2% of such value. For
more information, see "Contract Maintenance Charge."
+ Net of waiver and/or reimbursement.
3
<PAGE>
(1) For the fiscal year ended December 31, 1996, the Adviser waived Management
Fees in excess of 0.60% for Cash Management Fund, Government Fund,
Investment Grade Fund, Target Maturity 2007 Fund, Target Maturity 2010 Fund
and Utilities Income Fund. Absent the waiver, Management Fees would have
been 0.75% for each of these Funds. The Adviser will continue to waive
such fees for a minimum period ending December 31, 1997.
(2) Other Expenses have been restated for Cash Management Fund and Utilities
Income Fund to reflect current expenses. The Adviser will reimburse
Government Fund, Investment Grade Fund, Target Maturity 2007 Fund and
Target Maturity 2010 Fund for all Other Expenses and Cash Management Fund
for Other Expenses in excess of 0.10% for a minimum period ending December
31, 1997. Otherwise, Other Expenses would have been 0.36% for Cash
Management Fund, 0.19% for Government Fund, 0.13% for Investment Grade
Fund, and 0.07% for Target Maturity 2007 Fund and are estimated to be 0.23%
for Target Maturity 2010 Fund.
(3) If certain fees and expenses were not waived or reimbursed, Total Fund
Operating Expenses would have been 1.11% for Cash Management Fund, 0.94%
for Government Fund, 0.88% for Investment Grade Fund, 0.82% for Target
Maturity 2007 Fund, 0.86% for Utilities Income Fund and are estimated to
be 0.98% for Target Maturity 2010 Fund. Each Fund, other than
International Securities Fund, has an expense offset arrangement that may
reduce the Fund's custodian fee based on the amount of cash maintained by
the Fund with its custodian. Any such fee reductions are not reflected
under Total Fund Operating Expenses.
For more complete descriptions of the various costs and expenses shown,
please refer to "Purchases, Charges and Expenses." In addition, Premium taxes
may be applicable (see "Other Charges").
EXAMPLE
If you surrender your Contract at the end of the applicable time
period, you would pay the following expenses on a $1,000 investment, assuming 5%
annual return on assets:
1 year 3 years
------- -------
Blue Chip Fund . . . . . . . . . . . . 123 210
Cash Management Fund . . . . . . . . . 121 206
Discovery Fund . . . . . . . . . . . . 123 210
Government Fund. . . . . . . . . . . . 120 203
Growth Fund. . . . . . . . . . . . . . 123 210
High Yield Fund. . . . . . . . . . . . 123 210
International Securities Fund. . . . . 126 218
Investment Grade Fund. . . . . . . . . 120 203
Target Maturity 2007 Fund. . . . . . . 120 203
Target Maturity 2010 Fund. . . . . . . 120 203
Utilities Income Fund. . . . . . . . . 121 206
4
<PAGE>
EXAMPLE
If you do not surrender your contract, you would pay the following expenses on a
$1,000 investment, assuming 5% annual return on assets:
1 year 3 years
------ -------
Blue Chip Fund . . . . . . . . . . . . 53 160
Cash Management Fund . . . . . . . . . 51 156
Discovery Fund . . . . . . . . . . . . 53 160
Government Fund. . . . . . . . . . . . 50 153
Growth Fund. . . . . . . . . . . . . . 53 160
High Yield Fund. . . . . . . . . . . . 53 160
International Securities Fund. . . . . 56 168
Investment Grade Fund. . . . . . . . . 50 153
Target Maturity 2007 Fund. . . . . . . 50 153
Target Maturity 2010 Fund. . . . . . . 50 153
Utilities Income Fund. . . . . . . . . 51 156
THE EXPENSES IN THE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF
PAST OR FUTURE EXPENSES. ACTUAL EXPENSES IN FUTURE YEARS MAY BE GREATER OR LESS
THAN THOSE SHOWN.
GENERAL DESCRIPTION
FIRST INVESTORS LIFE INSURANCE COMPANY. First Investors Life Insurance
Company, 95 Wall Street, New York, New York 10005 ("First Investors Life"), a
stock life insurance company incorporated under the laws of the State of New
York in 1962, writes life insurance, annuities and accident and health
insurance. First Investors Consolidated Corporation ("FICC"), a holding
company, owns all of the voting common stock of First Investors Management
Company, Inc. ("FIMCO" or "Adviser") and all of the outstanding stock of First
Investors Life, First Investors Corporation ("FIC" or "Underwriter") and
Administrative Data Management Corp., the transfer agent for the Life Series
Fund. Mr. Glenn O. Head, Chairman of FICC, controls FICC, and, therefore,
controls the Adviser and First Investors Life.
SEPARATE ACCOUNT D. First Investors Life Variable Annuity Fund D, also
known by its proprietary name, the "Tax Tamer II" ("Separate Account D"), was
established on April 8, 1997 under the provisions of the New York Insurance Law.
The assets of Separate Account D are segregated from the assets of First
Investors Life, and that portion of such assets having a value equal to, or
approximately equal to, the reserves and contract liabilities under the
Contracts are not chargeable with liabilities arising out of any other business
of First Investors Life. Separate Account D is registered with the Securities
and Exchange Commission ("Commission") as a unit investment trust under the
Investment Company Act of 1940, as amended ("1940 Act"), but such registration
does not involve any supervision by the Commission of the management or
investment practices or policies of Separate Account D.
5
<PAGE>
The assets of each Subaccount of Separate Account D are invested at net
asset value in shares of the corresponding Fund of Life Series Fund. For
example, the Blue Chip Subaccount invests in the Blue Chip Fund, the Government
Subaccount invests in the Government Fund, and so on. The Life Series Fund's
Prospectus describes the risks attendant to an investment in each Fund of the
Life Series Fund.
Income, gains and losses, whether or not realized, from assets allocated to
the Subaccounts of Separate Account D are, in accordance with the applicable
Contracts, credited to or charged against the Subaccounts of Separate Account D
without regard to other income, gains or losses of First Investors Life. The
obligations under the Contracts are obligations of First Investors Life.
Any and all distributions received from a Fund will be paid in shares of
the distributing Fund or if in cash, will be reinvested in shares of that Fund
at net asset value for the corresponding Subaccount. Accordingly, no cash
distributions will be made to Contractowners. Deductions and redemptions from
any Subaccount of Separate Account D may be effected by redeeming the number of
applicable Fund shares, at net asset value, necessary to satisfy the amount to
be deducted or redeemed. Shares of the Funds in the Subaccounts will be valued
at their net asset values.
Separate Account D is divided into the following Subaccounts, each of which
corresponds to the following Funds of the Life Series Fund:
SEPARATE ACCOUNT D SUBACCOUNT FUND
- ------------------------------ -----
Blue Chip Subaccount Blue Chip Fund
Cash Management Subaccount Cash Management Fund
Discovery Subaccount Discovery Fund
Government Subaccount Government Fund
Growth Subaccount Growth Fund
High Yield Subaccount High Yield Fund
International Securities Subaccount International Securities Fund
Investment Grade Subaccount Investment Grade Fund
Target Maturity 2007 Subaccount Target Maturity 2007 Fund
Target Maturity 2010 Subaccount Target Maturity 2010 Fund
Utilities Income Subaccount Utilities Income Fund
Each Contractowner designates the Subaccount in which his or her purchase
payment will be invested. That Subaccount in turn invests in the corresponding
Fund of the Life Series Fund as set forth above.
Subject to applicable law, First Investors Life reserves the right to make
certain changes if, in its judgment, they would best serve the interests of the
Contractowners and Annuitants or would be appropriate in carrying out the
purposes of the Contracts. First Investors Life will obtain, when required, the
necessary Contractowner approval or regulatory approval for any changes and
provide, when required, the appropriate notification to Contractowners prior to
making such changes. Examples of the changes First Investors Life may make
include, but are not limited to:
- To operate Separate Account D in any form permitted under the
1940 Act or in any other form permitted by law.
6
<PAGE>
- To add, delete, combine, or modify the Subaccounts in Separate
Account D.
- To add, delete, or substitute for the Fund shares held in any
Subaccount, the shares of any investment company or series
thereof, or any investment permitted by law.
- To make any amendments to the Contracts necessary for the
Contracts to comply with the provisions of the Internal Revenue
Code or any other applicable Federal or state law.
YOUR CHOICE OF INVESTMENT OBJECTIVE. When you purchase a Contract you
decide to place your purchase payment and any additional purchase payments
into at least one but not more than five of the Subaccounts of Separate
Account D, provided the allocation to any one Subaccount is not less than 10%
of the purchase payment. Each Subaccount corresponds to a Fund of the Life
Series Fund. The investment objectives of each Fund of the Life Series Fund
are set forth below. There is no assurance that the investment objective of
any Fund of the Life Series Fund will be realized. Because each Fund of the
Life Series Fund is intended to serve a different investment objective, each
is subject to varying degrees of financial and market risks. In addition,
total operating expenses vary by Fund. Twelve (12) times during any Contract
year, you may transfer part or all of your cash value from the Subaccounts
you are in to other Subaccounts provided the cash value is not allocated to
more than five of the Subaccounts, and provided the allocation to any one
Subaccount is not less than 10% of the cash value of the Contract. The cash
value of the Contract may increase or decrease depending on the investment
performance of the Subaccounts selected. First Investors Life reserves the
right to adjust allocations to eliminate fractional percentages.
THE FUND. First Investors Life Series Fund is a diversified open-end
management investment company registered under the 1940 Act. Registration of
Life Series Fund with the Commission does not involve supervision by the
Commission of the management or investment practices or policies of the Life
Series Fund. The Life Series Fund consists of eleven separate Funds. The
shares of the Funds are not sold directly to the general public but are
available only through the purchase of an annuity contract or a variable life
insurance policy issued by First Investors Life. Life Series Fund reserves the
right to offer shares of its Funds to other separate accounts of First Investors
Life or directly to First Investors Life. The eleven Funds of Life Series Fund
may be referred to as: First Investors Life Blue Chip Fund, First Investors
Life Cash Management Fund, First Investors Life Discovery Fund, First Investors
Life Government Fund, First Investors Life Growth Fund, First Investors Life
High Yield Fund, First Investors Life International Securities Fund, First
Investors Life Investment Grade Fund, First Investors Life Target Maturity 2007
Fund, First Investors Life Target Maturity 2010 Fund and First Investors Life
Utilities Income Fund.
The investment objectives of each Fund of the Life Series Fund are as
follows:
BLUE CHIP FUND. The investment objective of Blue Chip Fund is to seek high
total investment return consistent with the preservation of capital. This goal
will be sought by investing, under normal market conditions, primarily in equity
securities of "Blue Chip" companies that the Adviser believes have potential
earnings growth that is greater than the average company included in the
Standard & Poor's 500 Composite Stock Price Index.
7
<PAGE>
CASH MANAGEMENT FUND. The objective of Cash Management Fund is to seek to
earn a high rate of current income consistent with the preservation of capital
and maintenance of liquidity. The Cash Management Fund will invest in money
market obligations, including high quality securities issued or guaranteed by
the U.S. Government or its agencies and instrumentalities, bank obligations and
high grade corporate instruments. An investment in the Fund is neither insured
nor guaranteed by the U.S. Government. There can be no assurance that the Fund
will be able to maintain a stable net asset value of $1.00 per share.
DISCOVERY FUND. The investment objective of Discovery Fund is to seek
long-term capital appreciation, without regard to dividend or interest income,
through investment in the common stock of companies with small to medium market
capitalization that the Adviser considers to be undervalued or less well known
in the current marketplace and to have the potential for capital growth.
GOVERNMENT FUND. The investment objective of Government Fund is to seek
to achieve a significant level of current income which is consistent with
security and liquidity of principal by investing, under normal market
conditions, primarily in obligations issued or guaranteed as to principal and
interest by the U.S. Government, its agencies or instrumentalities (including
mortgage-backed securities).
GROWTH FUND. The investment objective of Growth Fund is to seek long-term
capital appreciation. This goal will be sought by investing, under normal
market conditions, primarily in common stocks of companies and industries
selected for their growth potential.
HIGH YIELD FUND. The primary objective of High Yield Fund is to seek to
earn a high level of current income. The Fund actively seeks to achieve its
secondary objective of capital appreciation to the extent consistent with its
primary objective. The Fund seeks to attain its objectives primarily through
investments in lower-grade, high-yielding, high risk debt securities.
Investments in high yield, high risk securities, commonly referred to as "junk
bonds," may entail risks that are different or more pronounced than those
involved in higher-rated securities. See "High Yield Securities--Risk Factors"
in the Life Series Fund's Prospectus.
INTERNATIONAL SECURITIES FUND. The primary objective of International
Securities Fund is to seek long-term capital growth. As a secondary objective,
the Fund seeks to earn a reasonable level of current income. These objectives
are sought, under normal market conditions, through investment in common stocks,
rights and warrants, preferred stocks, bonds and other debt obligations issued
by companies or governments of any nation, subject to certain restrictions with
respect to concentration and diversification.
INVESTMENT GRADE FUND. The investment objective of Investment Grade Fund
is to seek a maximum level of income consistent with investment in investment
grade debt securities. The Fund seeks to achieve its objective primarily by
investing, under normal market conditions, in debt securities of U.S. issuers
that are rated in one of the four highest rating categories by Moody's Investors
Service, Inc. or Standard & Poor's Ratings Group or, if unrated, are deemed to
be of comparable quality by the Adviser.
8
<PAGE>
TARGET MATURITY 2007 FUND. The investment objective of Target Maturity 2007
Fund is to seek a predictable compounded investment return for investors who
hold their Fund shares until the Fund's maturity, consistent with the
preservation of capital. The Fund will seek its objective by investing,
under normal market conditions, in zero coupon securities which are issued by
the U.S. Government, its agencies or instrumentalities or created by third
parties using securities issued by the U.S. Government, its agencies or
instrumentalities.
TARGET MATURITY 2010 FUND. The investment objective of Target Maturity
2010 Fund is to seek a predictable compounded investment return for investors
who hold their Fund shares until the Fund's maturity, consistent with the
preservation of capital. The Fund will seek its objective by investing, under
normal market conditions, in zero coupon securities which are issued by the U.S.
Government, its agencies or instrumentalities or created by third parties using
securities issued by the U.S. Government, its agencies or instrumentalities.
UTILITIES INCOME FUND. The primary objective of Utilities Income Fund is
to seek high current income. Long-term capital appreciation is a secondary
objective. These objectives are sought, under normal market conditions, through
investment in equity and debt securities issued by companies primarily engaged
in the public utilities industry.
No offer will be made of a Contract funded by the underlying Fund unless a
current Life Series Fund Prospectus has been delivered. Each Fund of the Life
Series Fund may be referred to as "Fund" or "Series" in the underlying
Contracts.
For more complete information about each of the Funds underlying Separate
Account D, including management fees and other expenses, see Life Series Fund's
Prospectus. The Prospectus details each Fund's investment goals, management
strategies, investment restrictions, portfolio turnover rate, the market and
financial risks of an investment in the Fund's shares, as well as the risk of
investing in a fund that sells its shares to other separate accounts, including
variable life insurance company separate accounts. Because the Life Series Fund
sells its shares to more than one separate account, the possibility arises that
violation of the Federal tax laws by another separate account investing in Life
Series Fund could cause the Contracts funded through Separate Account D to lose
their tax-deferred status, unless remedial action were taken. It is important
to read the Prospectus carefully before you decide to invest. Additional copies
of Life Series Fund's Prospectus, which is attached hereto, may be obtained by
writing to First Investors Life Insurance Company, 95 Wall Street, New York, New
York 10005 or by calling (212) 858-8200. There can be no assurance that any of
the objectives of the Funds will be achieved.
ADVISER. First Investors Management Company, Inc. (the "Adviser"), an
affiliate of First Investors Life, is the investment adviser of each Fund. The
Adviser supervises and manages the investments and operations of each Fund,
except for International Securities Fund and Growth Fund. The Adviser is a New
York corporation located at 95 Wall Street, New York, NY 10005.
SUBADVISER. Wellington Management Company, LLP ("WMC" or "Subadviser") has
been retained by the Adviser and the Life Series Fund, on behalf of
International Securities Fund and Growth Fund, as each of those Funds'
investment subadviser. The Adviser has delegated discretionary trading
authority to WMC with respect to all the assets of International Securities Fund
and Growth Fund, subject to the continuing oversight and supervision of the
Adviser and the
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Life Series Fund's Board of Trustees. As compensation for its services, WMC is
paid by the Adviser, and not by either Fund, a fee which is computed daily and
paid monthly.
WMC, located at 75 State Street, Boston, MA 02109, is a Massachusetts
limited liability partnership of which Robert W. Doran, Duncan M. McFarland and
John R. Ryan are Managing Partners. WMC is a professional investment counseling
firm which provides investment services to investment companies, employee
benefit plans, endowment funds, foundations and other institutions and
individuals. As of December 31, 1996, WMC held investment management authority
with respect to approximately $133 billion of assets. Of that amount, WMC acted
as investment adviser or subadviser to approximately 84 registered investment
companies or series of such companies, with net assets of approximately $90
billion as of December 31, 1996. WMC is not affiliated with the Adviser or any
of its affiliates.
UNDERWRITER. First Investors Life and Separate Account D have entered into
an Underwriting Agreement with their affiliate, FIC, 95 Wall Street, New York,
New York 10005. First Investors Life has reserved the right in the
Underwriting Agreement to sell the Contracts directly. The Contracts are sold
by insurance agents licensed to sell variable annuities, who are registered
representatives of the Underwriter or broker-dealers who have sales agreements
with the Underwriter.
VOTING RIGHTS. First Investors Life will vote the shares of any Fund held
in a corresponding Subaccount or directly, at any Fund shareholders meeting, in
accordance with its view of present law. It will vote Fund shares held in any
corresponding Subaccount as follows: shares attributable to Contractowners for
which it receives instructions, in accordance with the instructions; shares
attributable to Contractowners for which it does not receive instructions, in
the same proportion that it votes shares held in the Subaccount for which it
receives instructions; and shares not attributable to Contractowners, in the
same proportion that it votes shares held in the Subaccount that are
attributable to Contractowners and for which it receives instructions. It will
vote Fund shares held directly in the same proportion that it votes shares held
in any corresponding subaccounts that are attributable to Contractowners and for
which it receives instructions, except that where there are no shares held in
any subaccount it will vote its own shares as it deems appropriate. All of the
shares of any Fund held by First Investors Life through a Subaccount or directly
will be presented at any Fund shareholders meeting for purposes of determining a
quorum.
Prior to the Annuity Commencement Date, the number of Fund shares held in a
corresponding Subaccount that is attributable to each Contractowner is
determined by dividing the Subaccount's Accumulated Value by the net asset value
of one Fund share. After the Annuity Commencement Date, the number of Fund
shares held in a corresponding Subaccount that is attributable to each
Contractowner is determined by dividing the reserve held in the Subaccount for
the variable annuity payment under the Contract by the net asset value of one
Fund share. As this reserve fluctuates, the number of votes fluctuates. The
number of votes that a Contractowner has the right to cast will be determined as
of the record date established by Life Series Fund.
Voting instructions will be solicited by written communication prior to the
date of the meeting at which votes are to be cast. Each Contractowner having a
voting interest in a Subaccount will be sent meeting and other materials
relating to the corresponding Fund.
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First Investors Life reserves the right to proceed other than as described
above, including the right to vote shares of any Fund in its own right, to the
extent permitted by law.
PURCHASES, CHARGES AND EXPENSES
PURCHASE PAYMENTS. Purchase payments are used to purchase Accumulation
Units of one or more Subaccounts and not shares of the Fund or Funds in which
the Subaccount or Subaccounts invest.
The minimum initial purchase payment is $25,000 for a Deferred Variable
Annuity Contract. Additional Payments under a Deferred Variable Annuity
Contract in the minimum amount of $200 may be made at any time after the
issuance of the Contract.
Initial purchase payments will be credited to a Contractowner's Account on
the Valuation Date they are received by First Investors Life, provided that
First Investors Life has received a duly completed application. Additional
payments will be credited to a Contractowner's Account on the Valuation Date
they are received by First Investors Life. In the event First Investors Life
receives an incomplete application, all required information shall be provided
not later than five business days following the receipt of such application or
the purchase payment will be returned to the applicant at the end of such
five-day period.
Purchase payments will be allocated to the appropriate Subaccount or
Subaccounts based upon the next computed value of an Accumulation Unit following
receipt by First Investors Life at its Executive Office or other designated
office. Accumulation Units are valued at the end of each Valuation Date (i.e.,
as of the close of regular trading on the NYSE, normally 4:00 p.m., Eastern
Time).
CONTINGENT DEFERRED SALES CHARGE. Separate Account D Deferred Variable
Annuity Contracts are sold without an initial sales charge, but may be subject
to a contingent deferred sales charge ("CDSC") upon a full or partial surrender
of the Contract. The CDSC is a percentage of the value of the Accumulation
Units surrendered (not to exceed the aggregate amount of the purchase payments
made for such Units) and declines, in accordance with the Table below, from 7%
to 0% over a seven year period. Purchase payments will be deemed surrendered in
the order in which they were received (first-in, first-out) and all surrenders
will be first from purchase payments and then from other contract values.
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CONTINGENT DEFERRED SALES CHARGE TABLE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
Contingent Deferred Sales Charge
as a Percentage of Purchase Payments Length of Time from Purchase Payment in
Surrendered Years
<S> <C>
7% Less than 1
6% 1-2
5% 2-3
4% 3-4
3% 4-5
2% 5-6
1% 6-7
0% More than 7
- ---------------------------------------------------------------------------------------------
</TABLE>
No CDSC will be assessed (i) in the event of the death of the Annuitant or
the Contractowner, as applicable, (ii) if the contract values are applied to an
annuity option provided for under this contract, (iii) for surrenders up to the
annual limit of the Withdrawal Privilege, or (iv) for surrenders used to pay
Premium taxes. For information concerning the Annuity Options and the
Withdrawal Privilege, see "Annuity Options" and "Surrender and Termination
(Redemption) During the Accumulation Period."
MORTALITY AND EXPENSE RISK CHARGES. Although the amount of each variable
annuity payment made to an Annuitant will vary in accordance with the investment
performance of the Subaccounts, the amount will not be affected by the mortality
experience (death rate) of persons receiving such payments or of the general
population. First Investors Life assumes this "mortality risk" by virtue of
annuity rates incorporated in the Contracts which cannot be changed.
The mortality risk assumed by First Investors Life arises from its
obligation to continue to make fixed or variable annuity payments, determined in
accordance with the annuity tables and other provisions of the Contracts, to
each Annuitant regardless of how long that person lives and regardless of how
long all payees as a group live. This assures an Annuitant that neither the
Annuitant's own longevity nor an improvement in life expectancy generally will
have any adverse effect on the variable annuity payments the Annuitant will
receive under the Contract, and relieves the Annuitant of the risk that the
Annuitant will outlive the funds that the Annuitant has accumulated for
retirement. First Investors Life also assumes mortality risk as a result of its
guarantee of a minimum payment in the event the Annuitant or the Contractowner
named in the original application for the Contract dies prior to the Annuity
Commencement Date.
In addition, First Investors Life assumes the risk that the charges for
administrative expenses may not be adequate to cover such expenses and assures
that it will not increase the amount charged for administrative expenses. In
consideration for its assumption of these mortality and expense risks, First
Investors Life deducts an amount equal on an annual basis to 1.25% of the daily
net asset value of the Subaccounts. Of such charge, approximately 0.85% is for
assuming the mortality risk and 0.4% is for assuming the expense risk.
First Investors Life guarantees that it will not increase the mortality and
expense risk charges
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during the term of any Contract. If the charges are insufficient to cover the
actual cost of the mortality and expense risks, the loss will fall on First
Investors Life; conversely, if the deductions prove more than sufficient, the
excess will be a profit to First Investors Life. Any profits resulting to First
Investors Life for over-estimates of the actual costs of the mortality and
expense risks can be used by First Investors Life for any business purpose,
including the payment of expenses of distributing the Contracts, and will not
remain in Separate Account D.
ADMINISTRATIVE CHARGE. First Investors Life deducts an amount equal on an
annual basis to .15% of the daily net asset value of the Subaccounts as an
administrative charge. This charge will not be increased during the term of any
Contract.
CONTRACT MAINTENANCE CHARGE. On the last business day of each Contract
Year or on the date of surrender of the Contract, if earlier, the Company
deducts a $30.00 Contract Maintenance Charge from the Accumulated Value,
provided that in no case will this charge exceed 2% of such value. It will be
charged against the Accumulated Value by proportionately reducing the number of
Accumulation Units held on that date with respect to each active Subaccount of
Separate Account D. This charge will not be increased during the term of any
Contract.
OTHER CHARGES. Some states assess Premium taxes which presently range from
0% to 2.35% at the time purchase payments are made; others assess Premium taxes
at the time of surrender or when annuity payments begin. First Investors Life
currently advances any Premium taxes due at the time purchase payments are made
and then deducts Premium taxes from the Accumulated Value of the Contract at the
time of surrender, upon death of the Annuitant or when annuity payments begin.
First Investors Life, however, reserves the right to deduct Premium taxes when
incurred. See "Appendix I" for Premium tax table.
EXPENSES. There are deductions from and expenses paid out of the assets of
the Funds that are described in the Prospectus for the Funds.
VARIABLE ANNUITY CONTRACTS
This Prospectus offers individual Deferred Variable Annuity Contracts under
which annuity payments will begin on a selected future date. First Investors
Life is offering the Contracts in states where it has the authority to issue the
Contracts. The individual Deferred Variable Annuity Contracts offered by this
Prospectus are designed to provide lifetime annuity payments to Annuitants in
accordance with the plan adopted by the Contractowner. The amount of annuity
payments will vary with the investment performance of the Subaccounts. The
Contracts obligate First Investors Life to make payments for the lifetime of the
Annuitant in accordance with the annuity rates contained in the Contract,
regardless of actual mortality experience (see "Annuity Period"). Upon the
death of the Annuitant under a Contract before the Annuity Commencement Date,
First Investors Life will pay a death benefit to the Beneficiary designated by
the Annuitant. For a discussion of the amount and manner of payment of this
benefit, see "Death of Annuitant."
All or a portion of the Accumulated Value may be surrendered during the
Accumulation Period. For a discussion on withdrawals during the Accumulation
Period, see "Surrender and Termination (Redemption) During the Accumulation
Period." For Federal income tax consequences of a withdrawal, see "Federal
Income Tax Status." The exercise of Contract rights herein described,
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<PAGE>
including the right to make a withdrawal during the Accumulation Period, will be
subject to the terms and conditions of any qualified trust or plan under which
the Contracts are purchased. This Prospectus contains no information concerning
such trust or plan.
First Investors Life reserves the right to amend the Contracts to meet the
requirements of the 1940 Act or other applicable Federal or state laws or
regulations.
Contractowners with any inquiries concerning their account should write to
First Investors Life Insurance Company at its Executive Office, 95 Wall Street,
New York, New York 10005.
DEFERRED VARIABLE ANNUITIES--ACCUMULATION PERIOD
CREDITING ACCUMULATION UNITS. During the Accumulation Period, purchase
payments on Deferred Variable Annuity Contracts are credited to the
Contractowner's Account in the form of Accumulation Units. The number of
Accumulation Units credited to a Contractowner for the Subaccounts is determined
by dividing the purchase payment by the value of an Accumulation Unit for the
Subaccount based upon the next computed value of an Accumulation Unit following
receipt of the purchase payment by First Investors Life at its Executive Office
or other designated office. The value of the Contractowner's Individual Account
varies with the value of the assets of the Subaccounts. The investment
performance of the Subaccounts, expenses and deduction of certain charges affect
the value of an Accumulation Unit. There is no assurance that the value of a
Contractowner's Individual Account will equal or exceed purchase payments. The
value of a Contractowner's Individual Account for a Valuation Period can be
determined by multiplying the total number of Accumulation Units credited to the
account for the Subaccount by the value of an Accumulation Unit for the
Subaccount for the Valuation Period.
ANNUITY PERIOD
COMMENCEMENT DATE. Annuity payments will begin on the Annuity
Commencement Date selected by the Contractowner. Not later than 30 days prior
to the Annuity Commencement Date, the Contractowner may elect in writing to
advance or defer the Annuity Commencement Date. The Annuity Commencement Date
may not be deferred beyond the Contract anniversary date following the
Annuitant's 90th birthday. If no other date is elected, annuity payments will
commence on the Contract anniversary date following the Annuitant's 90th
birthday.
If the Net Accumulated Value on the Annuity Commencement Date is less than
$2,000, First Investors Life may pay such value in one sum in lieu of annuity
payments. If the Net Accumulated Value is not less than $2,000 but the variable
annuity payments provided for would be or become less than $20, First Investors
Life may change the frequency of annuity payments to such intervals as will
result in payments of at least $20.
ASSUMED INVESTMENT RATE. A 3.5% assumed investment rate is built into the
Annuity Tables in the Contract. This is based on First Investors Life's opinion
that it is the average result to be expected from a diversified portfolio of
common stocks during a relatively stable economy. A higher assumption would
mean a higher initial payment but more slowly rising and more rapidly falling
subsequent variable annuity payments. A lower assumption would have the
opposite effect. If the actual net investment rate of the respective Subaccount
is at the annual rate of 3.5%, the variable
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<PAGE>
annuity payments will be level. A fixed annuity is an annuity with annuity
payments which remain fixed as to dollar amount throughout the payment period
and is based on an assumed interest rate of 3.5% per year built into the Annuity
Tables in the Contract.
ANNUITY OPTIONS. The Contractowner may, at any time at least 30 days prior
to the Annuity Commencement Date upon written notice to First Investors Life at
its Executive Office or other designated office, elect to have payments made
under any one of the Annuity Options provided in the Contract. If no election
is in effect on the Annuity Commencement Date, annuity payments will be made on
a variable basis only under Annuity Option 3 below, Life Annuity with 120
Monthly Payments Guaranteed, which is the Basic Annuity.
The material factors that determine the level of annuity benefits are (i)
the value of a Contractowner's Individual Account determined in the manner
described in this Prospectus before the Annuity Commencement Date, (ii) the
Annuity Option selected by the Contractowner, (iii) the sex and adjusted age of
the Annuitant and any Joint Annuitant at the Annuity Commencement Date and, (iv)
in the case of a variable annuity, the investment performance of the Subaccounts
selected.
On the Annuity Commencement Date, First Investors Life shall apply the
Accumulated Value, reduced by any applicable Premium taxes not previously
deducted, to provide the Basic Annuity or, if an Annuity Option has been
elected, to provide one of the Annuity Options described below.
The Contracts provide for the six Annuity Options described below:
Option 1 - LIFE ANNUITY - An annuity payable monthly during the lifetime of
the Annuitant, ceasing with the last payment due prior to the death of the
Annuitant. If this Option is elected, annuity payments terminate automatically
and immediately on the death of the Annuitant without regard to the number or
total amount of payments received.
Option 2a - JOINT AND SURVIVOR LIFE ANNUITY - An annuity payable monthly
during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing thereafter during the lifetime of the survivor, ceasing with the last
payment due prior to the death of the survivor.
Option 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY - An annuity
payable monthly during the joint lifetime of the Annuitant and the Joint
Annuitant and continuing thereafter during the lifetime of the survivor at an
amount equal to two-thirds of the joint annuity payment, ceasing with the last
payment due prior to the death of the survivor.
Option 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY - An annuity
payable monthly during the joint lifetime of the Annuitant and the Joint
Annuitant and continuing thereafter during the lifetime of the survivor at an
amount equal to one-half of the joint annuity payment, ceasing with the last
payment due prior to the death of the survivor.
Under Annuity Options 2a, 2b and 2c, annuity payments terminate
automatically and immediately on the deaths of both the Annuitant and the Joint
Annuitant without regard to the number or total amount of payments received.
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Option 3 - LIFE ANNUITY WITH 60, 120 OR 240 MONTHLY PAYMENTS GUARANTEED -
An annuity payable monthly during the lifetime of the Annuitant, with the
guarantee that if, at his or her death, payments have been made for less than
60, 120 or 240 monthly periods, as elected, any guaranteed annuity payments will
be continued during the remainder at the selected period to the Beneficiary.
Option 4 - UNIT REFUND LIFE ANNUITY - An annuity payable monthly during the
lifetime of the Annuitant, terminating with the last payment due prior to the
death of the Annuitant. An additional annuity payment will be made to the
Beneficiary equal to the Annuity Unit Value of the Subaccount or Subaccounts as
of the date that notice of death in writing is received by First Investors Life
at its Executive Office or other designated office, multiplied by the excess, if
any, of (a) over (b) where (a) is the Net Accumulated Value allocated to each
Subaccount and applied under the option at the Annuity Commencement Date,
divided by the corresponding Annuity Unit Value as of the Annuity Commencement
Date, and (b) is the product of the number of Annuity Units applicable under the
Subaccount represented by each annuity payment and the number of annuity
payments made. (For an illustration of this calculation, see Appendix II,
Example A, in the Statement of Additional Information.)
ALLOCATION OF ANNUITY. The Contractowner may elect to have the Net
Accumulated Value applied at the Annuity Commencement Date to provide a Fixed
Annuity, a Variable Annuity, or any combination thereof. After the Annuity
Commencement Date, no transfers or redemptions are allowed. Such elections must
be made in writing to First Investors Life at its Executive Office or other
designated office, at least 30 days prior to the Annuity Commencement Date. In
the absence of an election, annuity payments will be made on a variable basis
only under Annuity Option 3 above, Life Annuity with 120 Monthly Payments
Guaranteed, which is the Basic Annuity.
DEATH OF ANNUITANT
If the Annuitant dies prior to the Annuity Commencement Date, First
Investors Life will pay a Death Benefit to the Beneficiary designated by the
Contractowner upon receipt of a death certificate or similar proof of the death
of the Annuitant ("Due Proof of Death") and notification of the Beneficiary's
election to receive payment in either the form of a single sum settlement or an
annuity option ("Notification"). The value of the Death Benefit will be
determined as of the next computed value of the Accumulation Units following
receipt of Due Proof of Death and Notification by First Investors Life at its
Executive Office or other designated office.
If payment of the Death Benefit under one of the Annuity Options was not
elected by the Contractowner prior to the Annuitant's death, the Beneficiary may
elect to have the Death Benefit paid in a single sum or applied to provide an
annuity under one of the Annuity Options or as otherwise permitted by First
Investors Life. If a single sum settlement is requested, the amount of the
Death Benefit will be paid within seven days of receipt of Due Proof of Death
and Notification. In the event that only Due Proof of Death or Notification is
received, the Death Benefit will remain invested in the Separate Account in
accordance with the original investment choices of the Contractowner until both
pieces of information are received by First Investors Life at its Executive
Office or other designated office. If an Annuity Option is elected, the
Beneficiary will have up to ninety days commencing with the date of receipt of
Due Proof of Death and Notification in which to select from among the available
options. During the ninety day period, the Death Benefit will
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<PAGE>
remain invested in the Separate Account in accordance with the original
investment choices of the Contractowner. If such a selection is not made by the
end of the ninety-day period, a single sum settlement will be made to the
Beneficiary. If any Annuity Option is selected, the Annuity Commencement Date
shall be the date specified in the election but no later than ninety days after
receipt by First Investors Life of Due Proof of Death and Notification.
The amount of the Death Benefit payable upon the death of the Annuitant
will be the greatest of (1) the Accumulated Value on the date of receipt of Due
Proof of Death and Notification at the Executive Office of First Investors Life
or other designated office, (2) the Accumulated Value on the preceding Specified
Contract Anniversary, increased by any additional purchase payments and
decreased by any partial surrenders since that anniversary, or (3) the sum of
all purchase payments made under the Contract, decreased by any partial
surrenders. The Specified Contact Anniversary is every seventh contract
anniversary (i.e., 7th, 14th, 21st, etc.).
On receipt of Due Proof of Death of the Annuitant after Annuity Payments
have begun under an Annuity Option, if any payments remain under the Option they
will be paid to the Beneficiary as provided by the Option.
Unless otherwise provided in the Beneficiary designation, if no Beneficiary
survives the Annuitant, the proceeds will be paid in one sum to the
Contractowner, if living; otherwise, to the Contractowner's estate.
SURRENDER AND TERMINATION (REDEMPTION) DURING THE ACCUMULATION PERIOD
A Contractowner may elect, at any time before the earlier of the Annuity
Commencement Date or the death of the Annuitant, to surrender the Contract for
all or any part of the Contractowner's Individual Account. In the case of a
partial surrender, the amount remaining after the surrender must be at least
equal to First Investors Life's minimum amount rule then in effect (currently
$5,000). In the event of the termination of the Contract, First Investors Life
will, upon due surrender of the Contract at the Executive Office of First
Investors Life or other designated office, pay to the Contractowner the
Accumulated Value of the Contract less (1) any applicable CDSC, (2) the Contract
Maintenance Charge and (3) any applicable Premium Taxes not previously deducted.
For a more detailed discussion of these charges see "Purchases, Charges and
Expenses." However, on a non-cumulative basis, the Contractowner may make
partial surrenders during any Contract Year up to the annual Withdrawal
Privilege Amount of 10% of Purchase Payments and not incur CDSC on this amount.
Amounts surrendered pursuant to this Withdrawal Privilege will be deemed to be
from Accumulated Values other than Purchase Payments.
Any amount requested as a partial surrender shall be deducted from the
Subaccount resulting in a corresponding reduction in the number of Accumulation
Units credited to the Contractowner in the Subaccount. For any partial or full
surrender, the deduction will be based upon the next computed value of an
Accumulation Unit following receipt of a written request by First Investors Life
at its Executive Office or other designated office. First Investors Life may
defer any such payment for a period of not more than seven days. However, First
Investors Life may postpone such payment during any period when (a) trading on
the NYSE is restricted as determined by the Commission or the NYSE is closed for
other than weekends and holidays, (b) the Commission has by order permitted such
suspension or (c) any emergency, as defined by the rules of the
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Commission, exists during which time the sale of portfolio securities or
calculation of securities is not reasonably practicable. For information as to
Federal tax consequences resulting from surrenders, see "Federal Income Tax
Status." For information as to State Premium tax consequences, see "Other
Charge" and "Appendix I."
MATURITY DATE EXCHANGE PRIVILEGE. If this Contract is liquidated during
the one-year period preceding its maturity date ("Annuity Commencement Date"),
the proceeds can be used to purchase Class A shares of First Investors mutual
funds without incurring a sales charge.
DEATH OF CONTRACTOWNER
If the Contractowner dies before the entire interest in the Contract has
been distributed, the value of the Contract must be distributed to the
Beneficiary as provided below so that the Contract qualifies as an annuity under
Section 72(s) of the Internal Revenue Code of 1986, as amended (the "Code"). If
the Contractowner who dies is the one named in the original application for the
Contract, the entire interest of that Contactowner in the Contract will be the
same as if the Contractowner had been the Annuitant; if the Contractowner who
dies is not the one named in the original application for the Contract, the
entire interest of that Contractowner shall be the Accumulated Value of the
Contract.
If the death of the Contractowner occurs on or after the Annuity
Commencement Date, the entire interest in the Contract will be distributed at
least as rapidly as under the Annuity Option in effect on the date of death.
If the death of the Contractowner occurs prior to the Annuity Commencement
Date, the entire interest in the Contract will be (1) distributed to the
Beneficiary within five years, or (2) distributed under an Annuity Option
beginning within one year which provides that annuity payments will be made over
a period not longer than the life or life expectancy of the Beneficiary. If the
Contract is payable to (or for the benefit of) the Contractowner's surviving
spouse, no distributions will be required and the Contract may be continued with
the surviving spouse as the new Contractowner. If the Contractowner is also the
Annuitant, such spouse shall have the right to become the Annuitant under the
Contract. Likewise, if the Annuitant dies and the Contractowner is not a
natural person, the Annuitant's surviving spouse shall have the right to become
the Contractowner and the Annuitant.
TEN-DAY REVOCATION RIGHT
A Contractowner may, within ten days from the date the Contract is
delivered to the Contractowner (or longer as required by applicable state law),
elect to cancel the Contract. First Investors Life will, upon surrender of the
Contract, together with a written request for cancellation, at the Executive
Office of First Investors Life or other designated office, pay to the
Contractowner an amount equal to the Accumulated Value of the Contract on the
date of surrender. The amount refunded to Contractowners may be more or less
than their initial purchase payment depending on the investment results of the
designated Subaccount(s). In those states where a full refund of premiums is
required if the Contractowner elects to exercise to cancel the Contract under
the ten-day revocation right, such Contractowner shall be entitled to a full
refund of premiums paid upon such cancellation.
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FEDERAL INCOME TAX STATUS
The Contracts are designed for use by individuals who desire to accumulate
capital on a tax-deferred basis for retirement or other long-term purposes. The
Contracts may be purchased on a nonqualified basis or through the following
retirement plans qualified for special tax treatment under the Code
(1) individual retirement accounts and (2) qualified corporate employee pension
and profit-sharing plans.
In general, a Contract acquired by a person who is not an individual will
be treated as one which is not an annuity to the extent of contributions made
after February 28, 1986, and any income credited to a Contractowner's Individual
Account will accordingly be includable in the Contractowner's gross income on a
current basis in accordance with that person's method of accounting. The
preceding sentence will not apply to any annuity contract that is (i) acquired
by a decedent's estate by reason of the decedent's death, (ii) held under a
qualified pension, profit-sharing or stock bonus plan described under Section
401(a) of the Code or an employee annuity program described under Section 403(a)
of the Code (or that is purchased by an employer upon the termination of such
plan or program and that is held by the employer until all amounts under a
Contract are distributed to the employee for whom the Contract was purchased or
the employee's beneficiary), (iii) held under an individual retirement plan or
an employee annuity program described under Section 403(b) of the Code, or (iv)
an immediate annuity (as defined in Section 72(u)(4) of the Code).
The ultimate effect of Federal income taxes on Accumulated Values, on
annuity payments and on the economic benefit to the Contractowner, Annuitant or
Beneficiary depends on the tax status of both First Investors Life and the
individual concerned. The discussion contained herein is general in nature and
is not intended as tax advice. No attempt is made to consider any applicable
state or other tax laws. Moreover, the discussion herein is based upon First
Investors Life's understanding of Federal income tax laws as they are currently
interpreted. No representation is made regarding the likelihood of continuation
of current Federal income tax laws or the current interpretations of the
Internal Revenue Service. Prospective Contractowners should consult their tax
advisors as to the tax consequences of purchasing Contracts.
First Investors Life is taxed as a life insurance company under the Code.
Since Separate Account D is not a separate entity from First Investors Life and
its operation forms part of First Investors Life, it will not be taxed
separately as a "regulated investment company" under Subchapter M of the Code.
Under existing Federal income tax law, investment income of the Subaccounts of
Separate Account D, to the extent that it is applied (after taking into account
the mortality risk and expense risk charges) to increase reserves under the
Contract, is not taxed and may be compounded through reinvestment without
additional tax to First Investors Life to the extent income is so applied.
Thus, the Funds may realize net investment income and pay dividends and the
Subaccounts of Separate Account D may receive and reinvest them on behalf of
Contractowners, all without Federal income tax consequences for Separate Account
D or the Contractowner.
Under current interpretations of the Code, the Contractowner is not subject
to income tax on increases in the value of the Contractowner's Individual
Account until payments are received by
19
<PAGE>
the Contractowner under the Contract. Annuity payments received after the
Annuity Commencement Date will be taxed to the Contractowner as ordinary income
in accordance with Section 72 of the Code. However, that portion of each
payment which represents the Contractowner's investment in the Contract, which
is ordinarily the amount of purchase payments made under the Contract with
certain adjustments, will be excluded from gross income. The investment in the
Contract is divided by the Contractowner's life expectancy or other period for
which annuity payments are expected to be made, in the case of variable annuity
payments, and by the expected return, in the case of fixed annuity payments, to
determine the annual exclusion. Annuity payments received each year in excess
of this annual exclusion are taxable as ordinary income as provided in Section
72 of the Code.
In order that the Contracts be treated as annuities for Federal income tax
purposes, other than Contracts issued in connection with retirement plans that
are qualified under the Code, Separate Account D must satisfy certain
diversification requirements that are generally applicable to variable annuity
contract segregated asset accounts under Subchapter L of the Code. Ownership by
the Subaccounts of shares of the Funds will not fail the diversification
requirements provided that each Fund is taxed as a regulated investment company
under Subchapter M of the Code, and that each Fund meets such diversification
requirements, and all shares of the Funds are owned only by the Subaccounts (and
similar accounts of First Investors Life or other insurance companies), and
access to the Funds is available exclusively through the purchase of Contracts
(and additional variable annuity or life insurance products of First Investors
Life or other insurance companies). Fund shares also may be held by the Adviser
provided such shares are being held in connection with the creation or
management of the Fund. The Adviser does not intend to sell any Fund shares it
owns to the general public. It is expected that the Adviser will cause the
assets of the Funds to be invested in a manner that complies with the asset
diversification requirements.
The tax law does not currently provide guidance as to circumstances in
which a Contractowner may be said to have "control" over Separate Account D
assets and thus be subject to current taxation on income credited to the
Contractowner's Contract. The Treasury Department has said that it may provide
such guidance by a ruling or regulation. It is not clear what this additional
guidance would provide, nor whether it would be applied on a retroactive basis.
First Investors Life reserves the right to amend the Contracts in any
appropriate way and take other action necessary to avoid such current taxation.
With respect to withdrawals before the start of annuity payments, the Code
currently provides that: (i) withdrawals from an annuity contract are taxable as
ordinary income in the year of receipt to the extent that the Contract's
Accumulated Value exceeds the investment in the Contract, (ii) a loan under, or
an assignment or pledge of an annuity contract is treated as a distribution, and
(iii) a 10 percent penalty will be assessed, subject to certain exceptions, on
the taxable portion of withdrawals made prior to the taxpayer's attainment of
age 59 1/2.
In determining the amount of any distribution that is includable in gross
income, all annuity contracts issued by the same company to the same
Contractowner during any calendar year will be treated as one annuity contract.
Contractowners should consult their tax advisors before purchasing more than one
Contract during any calendar year.
Under the Code, income tax must generally be withheld from all "designated
distributions." A
20
<PAGE>
designated distribution includes the taxable portion of any distribution or
payment from an annuity. A partial surrender of an annuity contract is
considered a distribution subject to withholding.
The amount of withholding depends on the type of payment: "periodic" or
"non-periodic." For a periodic payment (E.G., an annuity payment), unless the
recipient files an appropriate withholding certificate, the tax withheld from
the taxable portion of the payment is based on a payroll withholding schedule
which assumes a married recipient claiming three withholding exemptions. For a
non-periodic payment distribution (E.G., a partial surrender of an annuity
contract), the tax withheld will generally be 10 percent of the taxable portion
of the payment.
A recipient may elect not to have the withholding rules apply. For periodic
payments, an election is effective for the calendar year for which it is made
and for each necessary year until amended or modified. For non-periodic
distributions, an election is effective only for the distribution for which it
is made. Payors must notify recipients of their right to elect to have taxes
withheld.
Insurers are required to report all designated distribution payments to the
Internal Revenue Service.
With respect to the Contracts issued in connection with retirement or
deferred compensation plans which do not meet the requirements applicable to tax
qualified plans, the tax status of the Annuitant is determined by the provisions
of the plan. In general, the Annuitant is not taxed until the Annuitant
receives annuity payments. The rules for taxation of payments under
non-qualified plans are, in general, similar to those for taxation of payments
under a qualified plan; however, the special income averaging treatment
available for certain lump sum payments under qualified plans is not available
for similar payments under nonqualified plans.
The Contracts may be purchased in connection with the following types of
tax-favored retirement plans: (1) individual retirement annuities and (2)
pension and profit-sharing plans of corporations qualified under Section 401(a)
or employee annuity programs described in Section 403(a) of the Code. The tax
rules applicable to these plans, including restrictions on contributions and
benefits, taxation of distribution and any tax penalties, vary according to the
type of plan and its terms and conditions. Participants under such plans, as
well as Contractowners, Annuitants and Beneficiaries, should be aware that the
rights of any person to any benefits under such plans may be subject to the
terms and conditions of the plans themselves, regardless of the terms and
conditions of the Contracts. Purchasers of Contracts for use with any qualified
plan, as well as plan participants and Beneficiaries, should consult counsel and
other competent advisors as to the suitability of the Contracts to their special
needs, and as to applicable Code limitations and tax consequences.
It should be noted that the laws and regulations with respect to the
foregoing tax matters are subject to change at any time by Congress and the
Treasury Department, respectively, and that the interpretations of such laws and
regulations now in effect are subject to change by judicial decision or by the
Treasury Department.
PERFORMANCE INFORMATION
21
<PAGE>
For further information on performance calculations, see "Performance
Information" in the Statement of Additional Information.
22
<PAGE>
TABLE OF CONTENTS
OF THE STATEMENT OF ADDITIONAL
INFORMATION
Item Page
----- ----
General Description. . . . . . . . . . . . . . . . 2
Services . . . . . . . . . . . . . . . . . . . . . 2
Annuity Payments . . . . . . . . . . . . . . . . . 4
Other Information. . . . . . . . . . . . . . . . . 5
Performance Information. . . . . . . . . . . . . . 6
Relevance of Financial Statements. . . . . . . . . 7
Appendices . . . . . . . . . . . . . . . . . . . . 8
Financial Statements . . . . . . . . . . . . . . . 13
APPENDIX I
STATE AND LOCAL TAXES*
<TABLE>
<S> <C> <C> <C>
Alabama. . . . . . . . . . . 1.00% Mississippi. . . . . . . . . 2.00%
Alaska . . . . . . . . . . . -- Missouri . . . . . . . . . . --
Arizona. . . . . . . . . . . -- Nebraska . . . . . . . . . . --
Arkansas . . . . . . . . . . -- New Jersey . . . . . . . . . --
California . . . . . . . . . 2.35 New Mexico . . . . . . . . . --
Colorado . . . . . . . . . . -- New York . . . . . . . . . . --
Connecticut. . . . . . . . . -- North Carolina . . . . . . . --
Delaware . . . . . . . . . . -- Ohio . . . . . . . . . . . . --
District of Columbia . . . . 2.25 Oklahoma . . . . . . . . . . --
Florida . . . . . . . . . . -- Oregon . . . . . . . . . . . --
Georgia . . . . . . . . . . -- Pennsylvania . . . . . . . . --
Illinois . . . . . . . . . . -- Rhode Island . . . . . . . . --
Indiana . . . . . . . . . . -- South Carolina . . . . . . . --
Iowa . . . . . . . . . . . . -- Tennessee. . . . . . . . . . --
Kentucky . . . . . . . . . . 2.00 Texas. . . . . . . . . . . . --
Louisiana . . . . . . . . . -- Utah . . . . . . . . . . . . --
Maryland . . . . . . . . . . -- Virginia . . . . . . . . . . --
Massachusetts . . . . . . . -- Washington . . . . . . . . . --
Michigan . . . . . . . . . . -- West Virginia. . . . . . . . 1.00
Minnesota . . . . . . . . . -- Wisconsin. . . . . . . . . . --
Wyoming. . . . . . . . . . . 1.00
</TABLE>
- --------------
Note: The foregoing rates are subject to amendment by legislation and the
applicability of the stated rates may be subject to administrative
interpretation.
* Includes local annuity Premium taxation.
23
<PAGE>
FIRST INVESTORS LIFE VARIABLE ANNUITY FUND D
INDIVIDUAL VARIABLE ANNUITY CONTRACTS
OFFERED BY
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENT OF ADDITIONAL INFORMATION DATED __________, 1997
This Statement of Additional Information is not a Prospectus and should be
read in conjunction with the Prospectus for First Investors Life Variable
Annuity Fund D, dated ____________, 1997, which may be obtained at no cost by
writing to First Investors Life Insurance Company, 95 Wall Street, New York, New
York 10005, or by telephoning (212) 858-8200.
TABLE OF CONTENTS
Page
----
General Description. . . . . . . . . . . . . . . . . . 2
Services . . . . . . . . . . . . . . . . . . . . . . . 2
Annuity Payments . . . . . . . . . . . . . . . . . . . 4
Other Information. . . . . . . . . . . . . . . . . . . 5
Performance Information. . . . . . . . . . . . . . . . 6
Relevance of Financial Statements. . . . . . . . . . . 7
Appendices . . . . . . . . . . . . . . . . . . . . . . 8
Financial Statements . . . . . . . . . . . . . . . . . 13
1
<PAGE>
GENERAL DESCRIPTION
FIRST INVESTORS LIFE INSURANCE COMPANY. First Investors Life Insurance
Company, 95 Wall Street, New York, New York 10005 ("First Investors Life"), a
stock life insurance company incorporated under the laws of the State of New
York in 1962, writes life insurance, annuities and accident and health
insurance. First Investors Consolidated Corporation ("FICC"), a holding
company, owns all of the voting common stock of First Investors Management
Company, Inc. ("FIMCO" or "Adviser") and all of the outstanding stock of First
Investors Life, First Investors Corporation ("FIC" or "Underwriter") and
Administrative Data Management Corp., the transfer agent for First Investors
Life Series Fund ("Life Series Fund"). Mr. Glenn O. Head, Chairman of FICC,
controls FICC and, therefore, controls the Adviser and First Investors Life.
SEPARATE ACCOUNT D. First Investors Life Variable Annuity Fund D
("Separate Account D") was established on April 8, 1997 under the provisions of
the New York Insurance Law. The assets of Separate Account D are segregated
from the assets of First Investors Life, and that portion of such assets having
a value equal to, or approximately equal to, the reserves and contract
liabilities under the Contracts are not chargeable with liabilities arising out
of any other business of First Investors Life. Separate Account D is registered
with the Securities and Exchange Commission ("Commission") as a unit investment
trust under the Investment Company Act of 1940, as amended (the "1940 Act"), but
such registration does not involve any supervision by the Commission of the
management or investment practices or policies of Separate Account D.
The assets of each Subaccount of Separate Account D are invested at net
asset value in shares of the corresponding series (each a "Fund" and
collectively "Funds") of Life Series Fund. For example, the Blue Chip
Subaccount invests in the Blue Chip Fund, the Government Subaccount invests in
the Government Fund, and so on. The Life Series Fund's Prospectus describes the
risks attendant to an investment in each Fund of Life Series Fund. The eleven
Funds of Life Series Fund may be referred to as: First Investors Life Blue Chip
Fund, First Investors Life Cash Management Fund, First Investors Life Discovery
Fund, First Investors Life Government Fund, First Investors Life Growth Fund,
First Investors Life High Yield Fund, First Investors Life International
Securities Fund, First Investors Life Investment Grade Fund, First Investors
Life Target Maturity 2007 Fund, First Investors Life Target Maturity 2010 Fund
and First Investors Life Utilities Income Fund.
SERVICES
CUSTODIAN. First Investors Life, subject to applicable laws and
regulations, is the custodian of the securities of the Subaccounts of Separate
Account D. The assets of the Subaccounts of Separate Account D are held by
United States Trust Company of New York, 114 W. 47th Street, New York, New York
10036 under a safekeeping arrangement. Under the terms of a Safekeeping
Agreement dated December 13, 1979 between First Investors Life and United States
Trust Company of New York, securities and similar investments of the Subaccounts
of Separate Account D shall be deposited in the safekeeping of United States
Trust Company of New York. First Investors Life is responsible for the payment
of all expenses of, and compensation to, United States Trust Company of New York
in such amounts as may be agreed upon from time to time.
INDEPENDENT PUBLIC ACCOUNTANTS. Tait, Weller & Baker, Two Penn Center
Plaza, Philadelphia, PA 19102, independent certified public accountants, has
been selected as the independent accountants for Separate Account D. First
Investors Life pays Tait, Weller & Baker a fee for serving as the independent
accountants for Separate Account D which is set by the Audit Committee of the
Board of Directors of First Investors Life.
ADVISER. Investment advisory services to each Fund are provided by First
Investors Management Company, Inc., 95 Wall Street, New York, NY 10005 pursuant
to an Investment Advisory Agreement dated June 13, 1994 (the "Advisory
Agreement"). The Advisory Agreement was approved, with respect to each Fund, by
Life Series Fund's Board of Trustees, including a majority of the Trustees
2
<PAGE>
who are not parties to the Advisory Agreement or "interested persons" (as
defined in the 1940 Act) of any such party, in person at a meeting called for
such purpose and by the shareholders of each Fund.
Pursuant to the Advisory Agreement, FIMCO shall supervise and manage each
Fund's investments, determine each Fund's, other than Growth Fund and
International Securities Fund, portfolio transactions and supervise all aspects
of each Fund's operations, subject to review by Life Series Fund's Trustees.
The Advisory Agreement also provides that FIMCO shall provide Life Series Fund
and each Fund with certain executive, administrative and clerical personnel,
office facilities and supplies, conduct the business and details of the
operation of each Fund and assume certain expenses thereof, other than
obligations or liabilities of a Fund, such as shareholder servicing fees and
expenses; custodian fees and expenses; legal and auditing fees; expenses of
communicating to existing shareholders, including preparing, printing and
mailing prospectuses and shareholder reports to such shareholders; and proxy and
shareholder meeting expenses.
Under the Advisory Agreement, each Fund pays the Adviser an annual fee,
paid monthly, according to the following schedule:
Annual
Average Daily Net Assets Rate
- ------------------------ ------
Up to $250 million . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%
In excess of $250 million up to $500 million . . . . . . . . . . . . 0.72
In excess of $500 million up to $750 million . . . . . . . . . . . . 0.69
Over $750 million. . . . . . . . . . . . . . . . . . . . . . . . . . 0.66
This fee is calculated separately for each Fund.
SUBADVISER. Investment subadvisory services are provided to Growth Fund
and International Securities Fund by Wellington Management Company, LLP ("WMC"
or "Subadviser") pursuant to a Subadvisory Agreement dated June 13, 1994 (the
"Subadvisory Agreement"). The Subadvisory Agreement was approved, with respect
to each Fund, by Life Series Fund's Board of Trustees, including a majority of
the Trustees who are not parties to the Subadvisory Agreement or "interested
persons" (as defined in the 1940 Act) of any such party, in person at a meeting
called for such purpose and by the shareholders of Growth Fund and International
Securities Fund. The Subadvisory Agreement provides that WMC shall manage the
investment operations of each Fund subject to the oversight and supervision of
the Adviser and the Board of Trustees.
Under the Subadvisory Agreement, the Adviser will pay to the Subadviser a
fee at an annual rate of 0.400% of the average daily net assets of each Fund
allocated to WMC up to and including $50 million; 0.275% of such average daily
net assets in excess of $50 million up to and including $150 million, 0.225% of
such average daily net assets in excess of $150 million up to and including $500
million; and 0.200% of such average daily net assets in excess of $500 million.
This fee is calculated separately for each Fund.
UNDERWRITER. First Investors Life and Separate Account D have entered into
an Underwriting Agreement with First Investors Corporation. FIC, an affiliate
of First Investors Life, and of the Adviser, has its principal business address
at 95 Wall Street, New York, New York 10005.
The Contracts are sold by insurance agents licensed to sell variable
annuities, who are registered representatives of the Underwriter or
broker-dealers who have sales agreements with the Underwriter.
3
<PAGE>
ANNUITY PAYMENTS
VALUE OF AN ACCUMULATION UNIT. For each Subaccount of Separate Account D,
the value of an Accumulation Unit was arbitrarily initially set at $10.00. The
value of an Accumulation Unit for any subsequent Valuation Period is determined
by multiplying the value of an Accumulation Unit for the immediately preceding
Valuation Period by the Net Investment Factor for the Valuation Period for which
the Accumulation Unit Value is being calculated (see Appendix I, Example B).
The investment performance of each Fund, expenses and deductions of certain
charges affect the Accumulation Unit Value. The value of an Accumulation Unit
for the Subaccounts may increase or decrease from Valuation Period to Valuation
Period.
NET INVESTMENT FACTOR. The Net Investment Factor for each Subaccount for
any Valuation Period is determined by dividing (a) by (b) and subtracting (c)
from the result, where:
(a) is the net result of:
(1) the net asset value per share of the applicable Fund determined at the
end of the current Valuation Period, plus
(2) the per share amount of any dividend or capital gains distributions
made by the applicable Fund if the "ex-dividend" date occurs during
the current Valuation Period.
(b) is the net asset value per share of the applicable Fund determined as of
the end of the immediately preceding Valuation Period.
(c) is a factor representing the charges deducted for mortality and expense
risks and administration. Such factor is equal on an annual basis to 1.40%
of the daily net asset value of the applicable Subaccount. This percentage
represents approximately a 0.85% charge for the mortality risk assumed, a
0.4% charge for the expense risk assumed, and a 0.15% charge for
administration.
The Net Investment Factor may be greater or less than one, and therefore,
the value of an Accumulation Unit for any Subaccount may increase or decrease.
(For an illustration of this calculation, see Appendix I, Example A.)
VALUE OF AN ANNUITY UNIT. For each Subaccount of Separate Account D, the
value of an Annuity Unit was arbitrarily initially set at $10.00. The value of
an Annuity Unit for any subsequent Valuation Period is determined by multiplying
the Annuity Unit Value for the immediately preceding Valuation Period by the Net
Investment Factor for the Valuation Period for which the Annuity Unit Value is
being calculated, and multiplying the result by an interest factor to offset the
effect of an investment earnings rate of 3.5% per annum, which is assumed in the
Annuity Tables contained in the Contract. (For an illustration of this
calculation, see Appendix III, Example A.)
AMOUNT OF ANNUITY PAYMENTS. When annuity payments are to commence, the
Accumulated Value to be applied to a variable annuity option will be determined
by multiplying the value of an Accumulation Unit for the Valuation Date on or
immediately preceding the seventh day before the Annuity Commencement Date by
the number of Accumulation Units owned. This seven day period is used to permit
calculation of amounts of annuity payments and mailing of checks in advance of
the due date. At that time, any applicable Premium taxes not previously
deducted will be deducted from the Accumulated Value to determine the Net
Accumulated Value. The resultant value is then applied to the Annuity Tables
set forth in the Contract to determine the amount of the first monthly annuity
payment. The Contract contains Annuity Tables setting forth the amount of the
first monthly installment for each $1,000 of Accumulated Value applied. These
Annuity Tables vary according to the Annuity Option selected by the
Contractowner and according to the sex and adjusted age of the Annuitant and any
Joint Annuitant at the Annuity Commencement Date. The Contract contains a
4
<PAGE>
formula for determining the adjusted age, and the Annuity Tables are determined
from the Progressive Annuity Table with interest at 3.5% per year and assumes
births prior to 1900, adjusted by a setback of four years of age for persons
born 1900 and later and an additional setback of one year of age for each
completed 5 years by which the year of birth is later than 1900. Annuity Tables
used by other insurers may provide greater or less benefits to the Annuitant.
The dollar amount of the first monthly Variable Payment, based on the
Subaccount determined as above, is divided by the value of an Annuity Unit for
the Subaccount for the Valuation Date on or immediately preceding the seventh
day before the Annuity Commencement Date to establish the number of Annuity
Units representing each monthly payment under the Subaccount. This seven day
period is used to permit calculation of amounts of annuity payments and mailing
of checks in advance of the due date. This number of Annuity Units remains fixed
for all variable annuity payments. The dollar amount of the second and
subsequent variable annuity payments is determined by multiplying the fixed
number of Annuity Units for the Subaccount by the applicable value of an Annuity
Value for the Valuation Date on or immediately preceding the seventh day before
the due date of the payment. The value of an Annuity Unit will vary with the
investment performance of the corresponding Fund, and, therefore, the dollar
amount of the second and subsequent variable annuity payments may change from
month to month. (For an illustration of the calculation of the first and
subsequent Variable Payments, see Appendix III, Examples B, C and D.)
A fixed annuity is an annuity with annuity payments which remain fixed as
to dollar amount throughout the payment period and is based on an assumed
interest rate of 3.5% per year built into the Annuity Tables in the Contract.
OTHER INFORMATION
TIME OF PAYMENTS. All payments due under the Contracts will ordinarily be
made within seven days of the payment due date or within seven days after the
date of receipt of a request for partial surrender or termination. However,
First Investors Life reserves the right to suspend or postpone the date of any
payment due under the Contracts (1) for any period during which the New York
Stock Exchange ("NYSE") is closed (other than customary weekend and holiday
closings) or during which trading on the NYSE, as determined by the Commission,
is restricted; (2) for any period during which an emergency, as determined by
the Commission, exists as a result of which disposal of securities held by the
Funds is not reasonably practical or it is not reasonably practical to determine
the value of the Funds' net assets; or (3) for such other periods as the
Commission may by order permit for the protection of security holders or as may
be permitted under the 1940 Act.
REPORTS TO CONTRACTOWNERS. First Investors Life will mail to each
Contractowner, at the last known address of record at the Home Office of First
Investors Life, at least annually, a report containing such information as may
be required by any applicable law or regulation and a statement of the
Accumulation Units credited to the Contract for each Subaccount and the
Accumulation Unit Values. In addition, latest available reports of Life Series
Fund will be mailed to each Contractowner.
ASSIGNMENT. Any amounts payable under the Contracts may not be commuted,
alienated, assigned or otherwise encumbered before they are due. To the extent
permitted by law, no such payments shall be subject in any way to any legal
process to subject them to payment of any claims against any Annuitant, Joint
Annuitant or Beneficiary. The Contracts may be assigned.
5
<PAGE>
PERFORMANCE INFORMATION
Separate Account D may advertise the performance of the Subaccounts in
various ways.
The yield for a Subaccount (other than Cash Management Subaccount) is
presented for a specified thirty-day period (the "base period"). Yield is based
on the amount determined by (i) calculating the aggregate amount of net
investment income earned by the Fund during the base period less expenses
accrued for that period (net of reimbursement), and (ii) dividing that amount by
the product of (A) the average daily number of Accumulation Units of the
Subaccount outstanding during the base period and (B) the net asset value per
Accumulation Unit on the last day of the base period. The result is annualized
by compounding on a semi-annual basis to determine the Subaccount's yield. For
this calculation, interest earned on debt obligations held by the underlying
Fund is generally calculated using the yield to maturity (or first expected call
date) of such obligations based on their market values (or, in the case of
receivables-backed securities such as GNMA's, based on cost). Dividends on
equity securities are accrued daily at their estimated stated dividend rates.
A Subaccount's "average annual total return" ("T") is an average annual
compounded rate of return. The calculation produces an average annual total
return for the number of years measured. It is the rate of return based on
factors which include a hypothetical initial investment of $1,000 ("P" in the
formula below) over a number of years ("n") with an Ending Redeemable Value
("ERV") of that investment, according to the following formula:
1/n
T=[(ERV/P) ]-1
The "total return" uses the same factors, but does not average the rate of
return on an annual basis. Total return is determined as follows:
[ERV-P]/P = TOTAL RETURN
In providing such performance data, each Subaccount will assume the payment
of the applicable CDSC imposed on a surrender of purchase payments for the
applicable period and the payment of applicable Mortality and Expense Risk and
administrative charges of 1.40% ("P"). Each Subaccount will assume that during
the period covered all dividends and capital gain distributions are paid at net
asset value per Accumulation Unit, and that the investment is redeemed at the
end of the period.
Return information may be useful to investors in reviewing a Subaccount's
performance. However, the total return and average annual total return will
fluctuate over time and the return figures for any given past period is not an
indication or representation by Separate Account D of future rates of return of
any Subaccount
At times, the Adviser may reduce its compensation or assume expenses of the
Fund in order to reduce the Fund's expenses. Any such waiver or reimbursement
would increase the corresponding Subaccount's total return, average annual total
return and yield during the period of the waiver or reimbursement.
Each Subaccount may include in advertisements and sales literature,
examples, information and statistics that illustrate the effect of taxable
versus tax-deferred compounding income at a fixed rate of return to demonstrate
the growth of an investment over a stated period of time resulting from the
payment of dividends and capital gains distributions in additional Accumulation
Units. The examples may include hypothetical returns comparing taxable versus
tax-deferred growth which would pertain to an IRA, Section 403(b)(7) Custodial
Account or other qualified retirement program. The
6
<PAGE>
examples used will be for illustrative purposes only and are not representations
by any Subaccount of past or future yield or return of any of the Subaccounts.
From time to time, in reports and promotional literature, Separate Account
D may compare the performance of its Subaccounts to, or cite the historical
performance of, other variable annuities. The performance rankings and ratings
of variable annuities reported in L-VIPPAS, a monthly publication for insurance
companies and money managers published by Lipper Analytical Services, Inc. and
in Morningstar Variable Annuity Performance Report, also a monthly publication
published by Morningstar, Inc., may be used. Additionally, performance rankings
and ratings reported periodically in national financial publications such as
MONEY, FORBES, BUSINESS WEEK, BARRON'S, FINANCIAL TIMES, CHANGING TIMES,
FORTUNE, NATIONAL UNDERWRITER, etc., may also be used. Quotations from articles
appearing in daily newspaper publications such as THE NEW YORK TIMES, THE WALL
STREET JOURNAL and THE NEW YORK DAILY NEWS may be cited.
DETERMINATION OF CURRENT AND EFFECTIVE YIELD. Separate Account D provides
current yield quotations for the Cash Management Subaccount based on the
underlying Fund's daily dividends. The underlying Fund declares dividends from
net investment income daily and pays them monthly.
For purposes of current yield quotations, dividends per Accumulation Unit
for a seven-day period are annualized (using a 365-day year basis) and divided
by the average value of an Accumulation Unit for the seven-day period.
The current yield quoted will be for a recent seven day period. Current
yields will fluctuate from time to time and are not necessarily representative
of future results. The investor should remember that yield is a function of the
type and quality of the instruments in the portfolio, portfolio maturity and
operating expenses. Current yield information is useful in reviewing the Cash
Management Subaccount's performance but, because current yield will fluctuate,
such information may not provide a basis for comparison with bank deposits or
other investments which may pay a fixed yield for a stated period of time, or
other investment companies, which may use a different method of calculating
yield.
In addition to providing current yield quotations, Separate Account D
provides effective yield quotations for the Cash Management Subaccount for a
base period return of seven days. An effective yield quotation is determined by
a formula which requires the compounding of the unannualized base period return.
Compounding is computed by adding 1 to the unannualized base period return,
raising the sum to a power equal to 365 divided by 7 and subtracting 1 from the
result.
RELEVANCE OF FINANCIAL STATEMENTS
The values of the interests of Contractowners under the variable portion of
the Contracts will be affected solely by the investment results of the
Subaccounts. The financial statements of First Investors Life as contained
herein should be considered only as bearing upon First Investors Life's ability
to meet its obligations to Contractowners under the Contracts, and they should
not be considered as bearing on the investment performance of the Subaccounts.
7
<PAGE>
APPENDICES
8
<PAGE>
APPENDIX I
EXAMPLE A
FORMULA AND ILLUSTRATION FOR DETERMINING
THE NET INVESTMENT FACTOR OF A SUBACCOUNT
OF SEPARATE ACCOUNT D
Net Investment Factor = A + B
----- - D
C
Where:
A = The Net Asset Value of a Fund share as of the end of the current
Valuation Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $8.51000000
B = The per share amount of any dividend or capital gains distribution
since the end of the immediately preceding Valuation Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 0
C = The Net Asset Value of a Fund share at the end of the immediately
preceding Valuation Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $8.39000000
D = The daily deduction for charges for mortality and expense risks
and administration, which totals 1.4% on an annual basis.
On a daily basis . . . . . . . . . . . . . . . . . . . . = .00003836
8.51000000 + 0
Then, the Net Investment Factor = --------------.00003836 . . = 1.01426438
8.39000000
EXAMPLE B
FORMULA AND ILLUSTRATION FOR DETERMINING
ACCUMULATION UNIT VALUE OF A SUBACCOUNT
OF SEPARATE ACCOUNT D
Accumulation Unit Value = A x B
Where:
A = The Accumulation Unit Value for the immediately preceding Valuation
Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $1.46328760
B = The Net Investment Factor for the current Valuation Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 1.01426438
Then, the Accumulation Unit Value = $1.46328760 x 1.01426438 = 1.48416049
9
<PAGE>
APPENDIX II
EXAMPLE A
FORMULA AND ILLUSTRATION FOR DETERMINING
DEATH BENEFIT PAYABLE UNDER
ANNUITY OPTION 4-UNIT REFUND LIFE ANNUITY
Upon the death of the Annuitant, the designated Beneficiary under this option
will receive under a Separate Account a lump sum death benefit of the then
dollar value of a number of Annuity Units computed using the following formula:
A A
Annuity Units Payable = -- -(CxD), if -- is greater than CxD
B B
Where:
A = The Net Accumulated Value applied on the Annuity Commencement Date to
purchase the Variable Annuity.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $20,000.00
B = The Annuity Unit Value at the Annuity Commencement Date.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $1.08353012
C = The number of Annuity Units represented by each payment made.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 116.61488844
D = The total number of monthly Variable Annuity Payments made prior
to the Annuitant's death.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 30
Then the number of Annuity Units Payable:
$20,000.00
----------- - (116.61488844 x 30)
$1.08353012
= 18,458.18554633 - 3,498.44665320
= 14,959.73889313
If the value of an Annuity Unit on the date of receipt of notification of death
was $1.12173107 then the amount of the death benefit under the Separate Account
would be:
14,959.73889313 x $1.12173107 = $16,780.80
10
<PAGE>
APPENDIX III
EXAMPLE A
FORMULA AND ILLUSTRATION FOR DETERMINING
ANNUITY UNIT VALUE OF
SEPARATE ACCOUNT D
Annuity Unit Value = A x B x C
Where:
A = Annuity Unit Value of the immediately preceding Valuation Period.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $1.10071211
B = Net Investment Factor for the Valuation Period for which the Annuity
Unit is being calculated.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 1.00083530
C = A factor to neutralize the assumed interest rate of 31/2% built into
the Annuity Tables used.
Daily factor equals. . . . . . . . . . . . . . . . . . . = 0.99990575
Then, the Annuity Value is:
$1.10071211 x 1.00083530 x 0.99990575 = $1.10152771
EXAMPLE B
FORMULA AND ILLUSTRATION FOR DETERMINING
AMOUNT OF FIRST MONTHLY VARIABLE ANNUITY PAYMENT FROM
SEPARATE ACCOUNT D
A
First Monthly Variable Annuity Payment = ----- x B
$1,000
Where:
A = The Net Accumulated Value allocated to Separate Account D for the
Valuation Date on or immediately preceding the seventh day
before the Annuity Commencement Date.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $20,000.00
B = The Annuity purchase rate per $1,000 based upon the option
selected, the sex and adjusted age of the Annuitant
according to the Annuity Tables contained in the Contract.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $6.40
$20,000
Then, the first Monthly Variable Payment = ------- x $6.40 = $128.00
$1,000
11
<PAGE>
EXAMPLE C
FORMULA AND ILLUSTRATION FOR DETERMINING
THE NUMBER OF ANNUITY UNITS FOR SEPARATE ACCOUNT D
REPRESENTED BY EACH MONTHLY VARIABLE ANNUITY PAYMENT
A
Number of Annuity Units = --
B
Where:
A = The dollar amount of the first monthly Variable Annuity Payment.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $128.00
B = The Annuity Unit Value for the Valuation Date on or immediately
preceding the seventh day before the Annuity Commencement Date.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $1.09763000
$128.00
Then, the number of Annuity Units = ------- = 116.61488844
$1.09763000
EXAMPLE D
FORMULA AND ILLUSTRATION FOR DETERMINING
THE AMOUNT OF SECOND AND SUBSEQUENT MONTHLY VARIABLE
ANNUITY PAYMENTS FROM SEPARATE ACCOUNT D
Second Monthly Variable Annuity Payment = A x B
Where:
A = The Number of Annuity Units represented by each monthly
Variable Annuity Payment.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = 116.61488844
B = The Annuity Unit Value for the Valuation Date on or immediately
preceding the seventh day before the date on which the
second (or subsequent) Variable Annuity Payment is due.
Assume . . . . . . . . . . . . . . . . . . . . . . . . . = $1.11834234
Then, the second monthly Variable Annuity Payment = 116.61488844 x $1.11834234 =
$130.42
The above example was based upon the assumption of an increase in the Annuity
Unit Value since the initial Variable Annuity Payment due to favorable
investment results of the Separate Account and the Fund. If the investment
results were less favorable, a decrease in the Annuity Unit Value and in the
second monthly Variable Annuity Payment could result. Assume B above was
$1.08103230.
Then, the second monthly Variable Annuity Payment = 116.61488844 x $1.08103230 =
$126.06
12
<PAGE>
Financial Statements as of
December 31, 1996
13
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
First Investors Life Insurance Company
New York, New York
We have audited the accompanying balance sheets of First Investors Life
Insurance Company as of December 31, 1996 and 1995, and the related statements
of income, stockholder's equity and cash flows for each of the three years in
the period ended December 31, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of First Investors Life
Insurance Company as of December 31, 1996 and 1995, and the results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1996, in conformity with generally accepted accounting principles.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
February 24, 1997
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
DECEMBER 31, 1996 DECEMBER 31,1995
<S> <C> <C>
Investments (note 2):
Available-for-sale securities......................... $114,011,891 $ 113,815,086
Held-to-maturity securities........................... 5,549,214 5,942,604
Short term investments................................ 7,667,491 5,160,201
Policy loans.......................................... 18,865,648 17,016,692
------------ ------------
Total investments.................................. 146,094,244 141,934,583
Cash ................................................... 901,980 1,189,030
Premiums and other receivables, net of allowances of
$30,000 in 1996 and 1995.............................. 3,998,210 4,334,595
Accrued investment income............................... 2,903,566 2,833,561
Deferred policy acquisition costs (note 6).............. 17,547,129 17,318,214
Deferred Federal income taxes (note 7) ............. 934,000 12,000
Furniture, fixtures and equipment, at cost, less
accumulated depreciation of $925,736 in 1996 and
$800,593 in 1995..................................... 146,078 236,736
Other assets............................................ 136,302 123,509
Separate account assets................................. 465,456,848 344,568,486
------------ ------------
Total assets....................................... $638,118,357 $512,550,714
============ ============
LIABILITIES AND STOCKHOLDER'S EQUITY
<CAPTION>
LIABILITIES:
Policyholder account balances (note 6).................. $113,295,474 $113,374,173
Claims and other contract liabilities................... 12,190,281 11,289,108
Accounts payable and accrued liabilities................ 3,730,943 4,150,250
Separate account liabilities............................ 464,852,507 343,956,938
------------- ------------
Total liabilities.................................. 594,069,205 472,770,469
------------- ------------
STOCKHOLDER'S EQUITY:
Common Stock, par value $4.75; authorized,
issued and outstanding 534,350 shares................. 2,538,163 2,538,163
Additional paid in capital.............................. 6,496,180 6,496,180
Unrealized holding gains (losses) on available-for-sale
securities (note 2)................................... 644,000 1,878,000
Retained earnings ...................................... 34,370,809 28,867,902
------------- ------------
Total stockholder's equity......................... 44,049,152 39,780,245
------------- ------------
Total liabilities and stockholder's equity......... $ 638,118,357 $512,550,714
============= ============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31,1995 DECEMBER 31,1994
----------------- ---------------- ----------------
<S> <C> <C> <C>
REVENUES
Policyholder fees................................... $ 22,955,165 $ 19,958,420 $16,433,269
Premiums............................................ 6,725,329 7,293,719 7,630,182
Investment income (note 2).......................... 9,771,389 9,363,212 8,835,356
Realized gain (loss) on investments................. (221,025) 373,582 (259,987)
Other income........................................ 704,678 835,703 701,355
-------------- -------------- --------------
Total income..................................... 39,935,536 37,824,636 33,340,175
-------------- -------------- --------------
BENEFITS AND EXPENSES
Benefits and increases in contract liabilities...... 12,912,810 13,027,516 14,297,499
Dividends to policyholders.......................... 964,913 954,384 910,754
Amortization of deferred acquisition costs (note 6). 1,454,408 1,672,429 1,573,216
Commissions and general expenses.................... 16,287,498 15,773,968 13,513,644
-------------- -------------- --------------
Total benefits and expenses...................... 31,619,629 31,428,297 30,295,113
-------------- -------------- --------------
Income before Federal income tax ..................... 8,315,907 6,396,339 3,045,062
Federal income tax (note 7):
Current............................................. 3,099,000 2,553,000 838,000
Deferred............................................ (286,000) (376,000) (352,000)
-------------- -------------- --------------
2,813,000 2,177,000 486,000
-------------- -------------- --------------
Net Income............................................ $ 5,502,907 $ 4,219,339 $ 2,559,062
============== ============== ============
Income per share, based on 534,350 shares outstanding
$10.30 $7.90 $4.79
=============== ================= ===============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF STOCKHOLDER'S EQUITY
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31,1996 DECEMBER 31,1995 DECEMBER 31, 1994
---------------- ---------------- -----------------
<S> <C> <C> <C>
Balance at beginning of year.............................. $ 39,780,245 $ 31,196,906 $ 34,173,844
Net income................................................ 5,502,907 4,219,339 2,559,062
Increase (decrease) in unrealized holding gains on
available-for-sale securities........................... (1,234,000) 4,364,000 (5,536,000)
------------ ------------- ------------
Balance at end of year.................................... $ 44,049,152 $ 39,780,245 $ 31,196,906
============ ============= ============
STATEMENTS OF CASH FLOWS
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31,1996 DECEMBER 31,1995 DECEMBER 31, 1994
---------------- ---------------- -----------------
<S> <C> <C> <C>
Increase (decrease) in cash:
Cash flows from operating activities:
Policyholder fees received.......................... $ 22,925,131 $ 19,374,522 $ 16,433,269
Premiums received................................... 6,413,009 6,895,096 7,366,276
Amounts received on policyholder accounts........... 105,489,481 87,156,662 63,526,544
Investment income received.......................... 9,964,169 9,360,894 8,886,847
Other receipts...................................... 55,779 69,621 46,581
Benefits and contract liabilities paid.............. (117,321,389) (101,642,156) (75,131,594)
Commissions and general expenses paid............... (20,857,687) (18,176,870) (15,252,935)
------------ ------------- -------------
Net cash provided by (used for) operating
activities....................................... 6,668,493 3,037,769 5,874,988
------------ ------------- -------------
Cash flows from investing activities:
Proceeds from sale of investment securities......... 39,062,702 58,755,827 36,751,082
Purchase of investment securities................... (44,134,604) (58,622,646) (42,164,770)
Purchase of furniture, equipment and other
assets........................................... (34,485) (128,442) (67,121)
Net increase in policy loans........................ (1,848,956) (2,330,591) (1,801,780)
Investment in Separate Account ..................... (200) (500,000) --
------------ ------------- -------------
Net cash provided by (used for) investing
activities....................................... (6,955,543) (2,825,852) (7,282,589)
------------ ------------- -------------
Net increase (decrease) in cash..................... (287,050) 211,917 (1,407,601)
Cash
Beginning of year ..................................... 1,189,030 977,113 2,384,714
------------ ------------- -------------
End of year............................................ $ 901,980 $ 1,189,030 $ 977,113
============ ============= =============
</TABLE>
The Company received a refund of Federal income tax of $102,000 in 1995 and paid
Federal income tax of $3,243,000 in 1996, $2,125,000 in 1995 and $1,368,000 in
1994.
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1994
------------ ------------ ------------
<S> <C> <C> <C>
Reconciliation of net income to net cash
provided by (used for) operating activities:
Net income ............................................................ $ 5,502,907 $ 4,219,339 $ 2,559,062
Adjustments to reconcile net income to net cash provided by (used for)
operating activities:
Depreciation and amortization ...................................... 130,924 141,121 122,199
Amortization of deferred policy
acquisition costs ............................................... 1,454,408 1,672,429 1,573,216
Realized investment (gains) losses ............................................. 221,025 (373,582) 259,987
Amortization of premiums and discounts on
investments ...................................................... 262,785 237,472 287,340
Deferred Federal income taxes ...................................... (286,000) (376,000) (352,000)
Other items not requiring cash - net ............................... 6,794 (112,268) (149)
(Increase) decrease in:
Premiums and other receivables, net ................................ 336,385 (433,106) (1,055,910)
Accrued investment income .......................................... (70,005) (239,790) (235,849)
Deferred policy acquisition costs, exclusive
of amortization .................................................. (1,275,323) (1,117,752) (1,138,988)
Other assets ....................................................... (18,574) 64,490 (30,882)
Increase (decrease) in:
Policyholder account balances ...................................... (78,699) (1,882,591) 2,719,458
Claims and other contract liabilities .............................. 901,173 551,392 503,025
Accounts payable and accrued liabilities ........................... (419,307) 686,615 664,479
----------- ----------- -----------
$ 6,668,493 $ 3,037,769 $ 5,874,988
=========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
Note 1 -- Basis of Financial Statements
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles (GAAP). Such basis of presentation
differs from statutory accounting practices permitted or prescribed by insurance
regulatory authorities primarily in that:
(a) policy reserves are computed according to the Company's estimates of
mortality, investment yields, withdrawals and other benefits and expenses,
rather than on the statutory valuation basis;
(b) certain expenditures, principally for furniture and equipment and agents'
debit balances, are recognized as assets rather than being non-admitted and
therefore charged to retained earnings;
(c) commissions and other costs of acquiring new business are recognized as
deferred acquisition costs and are amortized over the premium paying period
of policies and contracts, rather than charged to current operations when
incurred;
(d) income tax effects of temporary differences, relating primarily to policy
reserves and acquisition costs, are provided;
(e) the statutory asset valuation and interest maintenance reserves are
reported as retained earnings rather than as liabilities;
Note 2 -- Other Significant Accounting Practices
(a) Accounting 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 disclosures of contingent assets and liabilities, at the date
of the financial statements and revenues and expenses during the reported
period. Actual results could differ from those estimates.
(b) Depreciation. Depreciation is computed on the useful service life of the
depreciable asset using the straight line method of depreciation.
(c) Investments. Investments in equity securities that have readily
determinable fair values and all investments in debt securities are classified
in three separate categories and accounted for as follows:
HELD-TO-MATURITY SECURITIES
Debt securities the Company has the positive intent and ability to
hold to maturity are recorded at amortized cost.
TRADING SECURITIES
Debt and equity securities that are held principally for the purpose
of selling such securities in the near term are recorded at fair value
with unrealized gains and losses included in earnings.
AVAILABLE-FOR-SALE SECURITIES
Debt and equity securities not classified in the other two categories
are recorded at fair value with unrealized gains and losses excluded
from earnings and reported as "unrealized holding gains or losses on
available-for-sale securities" in stockholder's equity.
Short term investments are reported at market value which approximates cost.
<PAGE>
Gains and losses on sales of investments are determined using the specific
identification method. Investment income for the years indicated consists of the
following:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31,1996 DECEMBER 31, 1995 DECEMBER 31,1994
<S> <C> <C> <C> <C>
Interest on fixed maturities...................... $ 8,559,429 $ 8,243,748 $ 8,091,627
Interest on short term investments................ 410,930 451,475 225,682
Interest on policy loans.......................... 1,151,681 973,242 886,465
Dividends on equity securities.................... 43,756 58,305 10,220
------------ ------------ ------------
Total investment income...................... 10,165,796 9,726,770 9,213,994
Investment expense........................... 394,407 363,558 378,638
------------ ------------ ------------
Net investment income............................. $ 9,771,389 $ 9,363,212 $ 8,835,356
============ ============ ============
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The amortized cost and estimated market values of investments at
December 31, 1996 and 1995 are as follows:
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED MARKET
COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
Available-For-Sale Securities
December 31, 1996
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies .......................... $ 41,254,552 $ 569,803 $ 157,020 $ 41,667,335
Debt Securities issued by
States of the U.S. .................... 5,525,022 -- 172,264 5,352,758
Corporate Debt Securities .............. 56,013,590 1,217,747 297,752 56,933,585
Other Debt Securities .................. 9,952,727 133,266 27,780 10,058,213
------------ ---------- ------------ ------------
$112,745,891 $1,920,816 $ 654,816 $114,011,891
============ ========== ============ ============
December 31,1995
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies .......................... $ 40,056,913 $1,459,984 $ -- $ 41,516,897
Debt Securities issued by
States of the U.S. .................... 9,067,445 215,464 10,295 9,272,614
Corporate Debt Securities .............. 53,636,330 1,872,502 121,193 55,387,639
Equity Securities ...................... 500,000 55,000 -- 555,000
Other Debt Securities .................. 7,010,398 78,876 6,338 7,082,936
------------ ---------- ------------ ------------
$110,271,086 $3,681,826 $ 137,826 $113,815,086
============ ========== ============ ============
</TABLE>
<PAGE>
At December 31, 1996 and 1995, the Company recognized "Unrealized Holding
Gains (Losses) on Available-For-Sale Securities" of $644,000 and $1,878,000, net
of applicable deferred income taxes and amortization of deferred acquisition
costs. The change in the Unrealized Holding Gains (Losses) of ($1,234,000) ,
$4,364,000 and ($5,536,000) for 1996, 1995 and 1994, respectively is reported as
a separate component of stockholders' equity.
Held-To-Maturity Securities
December 31,1996
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ........... $3,439,214 $36,945 $ 10,944 $3,465,215
Corporate Debt Securities 2,000,000 -- 66,200 1,933,800
Other Debt Securities ... 110,000 -- -- 110,000
---------- ------- ---------- ----------
$5,549,214 $36,945 $ 77,144 $5,509,015
========== ======= ========== ==========
December 31,1995
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ........... $3,332,604 $120,983 $ -- $3,453,587
Corporate Debt Securities 2,000,000 -- 40,412 1,959,588
Other Debt Securities ... 610,000 -- -- 610,000
---------- -------- ---------- ----------
$5,942,604 $120,983 $ 40,412 $6,023,175
========== ======== ========== ==========
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The amortized cost and estimated market value of debt securities at
December 31, 1996, by contractual maturity, 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.
<TABLE>
<CAPTION>
HELD TO MATURITY AVAILABLE FOR SALE
AMORTIZED ESTIMATED AMORTIZED ESTIMATED
COST MARKET VALUE COST MARKET VALUE
<S> <C> <C> <C> <C>
Due in one year or less....................... $ 100,000 $ 100,000 $ 2,359,443 $ 2,368,650
Due after one year through five years......... 267,660 265,400 36,423,615 36,855,145
Due after five years through ten years........ 3,181,554 3,209,815 48,199,575 49,009,561
Due after ten years........................... 2,000,000 1,933,800 25,763,258 25,778,535
---------- ---------- ------------ ------------
$5,549,214 $5,509,015 $112,745,891 $114,011,891
========== ========== ============ ============
</TABLE>
Proceeds from sales of investments in fixed maturities were $39,046,422,
$56,949,635 and $36,701,082 in 1996, 1995 and 1994, respectively. Gross gains of
$185,708 and gross losses of $406,733 were realized on those sales in 1996.
Gross gains of $578,810 and gross losses of $205,228 were realized on those
sales in 1995. Gross gains of $85,827 and gross losses of $345,814 were realized
on those sales in 1994.
(d) Recognition of Revenue, Policyholder Account Balances and Policy
Benefits
TRADITIONAL ORDINARY LIFE AND HEALTH
Revenues from the traditional life insurance policies represent
premiums which are recognized as earned when due. Health insurance
premiums are recognized as 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 lives of
the contracts. This association is accomplished by means of the
provision for liabilities for future policy benefits and the deferral
and amortization of policy acquisition costs.
UNIVERSAL LIFE AND VARIABLE LIFE
Revenues from universal life and variable life policies represent
amounts assessed against policyholders. Included in such assessments
are mortality charges, surrender charges and policy service fees.
Policyholder account balances on universal life consist of the
premiums received plus credited interest, less accumulated
policyholder assessments. Amounts included in expense represent
benefits in excess of policyholder account balances. The value of
policyholder accounts on variable life are included in separate
account liabilities as discussed below. ANNUITIES Revenues from
annuity contracts represent amounts assessed against contractholders.
Such assessments are principally sales charges, administrative fees,
and in the case of variable annuities, mortality and expense risk
charges. The carrying value and fair value of fixed annuities are
equal to the policyholder account balances, which represent the net
premiums received plus accumulated interest.
(e) Separate Accounts. Separate account assets and the related
liabilities, both of which are valued at market, represent segregated variable
annuity and variable life contracts maintained in accounts with individual
investment objectives. All investment income (gains and losses of these
accounts) accrues directly to the contractholders and therefore does not affect
net income of the Company.
(f) Reclassifications. Certain reclassifications have been made to the
1994 and 1995 Financial Statements in order to conform to the 1996 presentation.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note 3 -- Fair Value of Financial Instruments
The carrying amounts for cash, short-term investments and policy loans as
reported in the accompanying balance sheet approximate their fair values. The
fair values for fixed maturities and equity-securities are based upon quoted
market prices, where available or are estimated using values from independent
pricing services.
The carrying amounts for the Company's liabilities under investment - type
contracts approximate their fair values because interest rates credited to
account balances approximate current rates paid on similar investments and are
generally not guaranteed beyond one year. Fair values for the Company's
insurance contracts other than investment - type contracts are not required to
be disclosed. However, the fair values of liabilities for all insurance
contracts are taken into consideration in the overall management of interest
rate risk, which minimizes exposure to changing interest rates.
Note 4 -- Retirement Plans
The Company participates in a non-contributory profit sharing plan for the
benefit of its employees and those of other wholly-owned subsidiaries of its
parent. The Plan provides for retirement benefits based upon earnings. Vesting
of benefits is based upon years of service. For the years ended December 31,
1996, 1995 and 1994, the Company charged operations approximately $100,000,
$40,000 and $ 0, respectively for its portion of the contribution.
The Company also has a non-contributory retirement plan for the benefit of
its sales agents. The plan provides for retirement benefits based upon
commission on first-year premiums and length of service. The plan is unfunded.
Vesting of benefits is based upon graduated percentages dependent upon the
number of allocations made in accordance with the plan by the Company for each
participant. The Company charged to operations pension expenses of approximately
$414,000 in 1996, $375,000 in 1995 and $312,000 in 1994. The accrued liability
of approximately $2,858,000 in 1996 and $2,621,000 in 1995 was sufficient to
cover the value of benefits provided by the plan.
In addition, the Company participates in a 401(k) savings plan covering
all of its eligible employees and those of other wholly-owned subsidiaries of
its parent whereby employees may voluntarily contribute a percentage of their
compensation with the Company matching a portion of the contributions of certain
employees. The amount contributed by the Company in 1996 and 1995 was not
material.
Note 5 -- Commitments and Contingent Liabilities
The Company has agreements with affiliates and non-affiliates as follows:
(a) The Company's maximum retention on any one life is $100,000. The
Company reinsures a portion of its risk with other insurance companies and
reserves are reduced by the amount of reserves for such reinsured risks. The
Company is liable for any obligations which any reinsurance company may be
unable to meet. The Company had reinsured approximately 10% of its net life
insurance in force at December 31, 1996, 1995 and 1994. The Company also had
assumed reinsurance amounting to approximately 21%, 20% and 21% of its net life
insurance in force at the respective year ends. None of these transactions had
any material effect on the Company's operating results.
(b) The Company and certain affiliates share office space, data processing
facilities and management personnel. Charges for these services are based upon
space occupied, usage of data processing facilities and time allocated to
management. During the years ended December 31, 1996, 1995 and 1994, the Company
paid approximately $1,222,000, $1,282,000 and $1,099,000, respectively, for
these services. In addition, the Company reimbursed an affiliate approximately
$9,709,000 in 1996, $8,739,000 in 1995,and $6,651,000 in 1994 for commissions
relating to the sale of its products.
The Company maintains a checking account with a financial institution,
which is also a wholly-owned subsidiary of its parent. The balance in this
account was approximately $ 326,000 at December 31, 1996 and $343,000 at
December 31, 1995.
(c) The Company is subject to certain claims and lawsuits arising in the
ordinary course of business. In the opinion of management, all such claims
currently pending will not have a material adverse effect on the financial
position of the Company or its results of operations.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note 6 -- Adjustments Made to Statutory Accounting Practices
Note 1 describes some of the common differences between statutory practices
and generally accepted accounting principles. The effects of these differences
for the years ended December 31, 1996, 1995 and 1994 are shown in the following
table in which net income and capital shares and surplus reported therein on a
statutory basis are adjusted to a GAAP basis.
<TABLE>
<CAPTION>
NET INCOME CAPITAL SHARES AND SURPLUS
YEAR ENDED DECEMBER 31 AT DECEMBER 31
----------------------- ------------------------
1996 1995 1994 1996 1995 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Reported on a statutory basis.......... $5,002,533 $3,705,334 $2,205,814 $26,580,877 $21,600,537 $18,020,531
---------- ---------- ---------- ----------- ----------- -----------
Adjustments:
Deferred policy acquisition costs (b) (179,085) (554,677) (434,228) 17,547,129 17,318,214 19,321,891
Future policy benefits (a).......... 514,086 422,387 727,849 (2,398,397) (2,912,483) (3,334,870)
Deferred income taxes............... 286,000 376,000 352,000 934,000 12,000 1,884,000
Premiums due and deferred (e)....... 85,461 80,133 70,968 (1,359,107) (1,444,568) (1,524,702)
Cost of colletion and other statutory
liabilities....................... (12,283) (16,318) (32,454) 36,984 49,267 65,585
Non-admitted assets................. -- -- -- 298,731 395,758 385,500
Asset valuation reserve................ -- -- -- 1,136,664 1,016,830 901,041
Interest maintenance reserve........ (48,542) (40,804) 71,048) 6,271 200,690 (5,070)
Gross unrealized holding gains (losses) on
available-for-sale securities... -- -- -- 1,266,000 3,544,000 (4,517,000)
Net realized capital gains (losses). (221,025) 373,582 (259,987) -- -- --
Other............................... 75,762 126,298) 148 -- -- --
---------- ---------- ---------- ----------- ----------- -----------
500,374 514,005 353,248 17,468,275 18,179,708 13,176,375
---------- ---------- ---------- ----------- ----------- -----------
In accordance with generally accepted
accounting principles............... $5,502,907 $4,219,339 $2,559,062 $44,049,152 $39,780,245 $31,196,906
Per share, based on 534,350 shares
outstanding......................... $10.30 $7.90 $4.79 $82.44 $74.45 $58.38
====== ===== ===== ====== ======= ======
</TABLE>
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The following is a description of the significant policies used to adjust
the net income and capital shares and surplus from a statutory to a GAAP basis.
(a) Liabilities for future policy benefits have been computed primarily by
the net level premium method with assumptions as to anticipated mortality,
withdrawals and investment yields. The composition of the policy liabilities and
the more significant assumptions pertinent thereto are presented below:
<TABLE>
<CAPTION>
DISTRIBUTION OF LIABILITIES* BASIS OF ASSUMPTIONS
YEARS
1996 1995 OF ISSUE INTEREST MORTALITY TABLE WITHDRAWAL
----- ---- -------- -------- --------------- ----------
<S> <C> <C> <C> <C> <C>
Non-par:
$ 1,655,040 $ 1,722,604 1962-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton B
5,814,885 5,668,858 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton B
2,546,702 2,574,079 1984-1988 7 1/2% 85% of 1965-70 Basic Select Modified
plus Ultimate Linton B
86,508 74,055 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Linton B
113,117 109,919 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Actual
34,185 39,885 1989-Present 8% 1975-80 Basic Select plus Ultimate Actual
31,902,122 31,896,847 1985-Present 6% Accumulation of Funds --
Par:
223,500 224,307 1966-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton A
13,357,249 13,557,033 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton A
975,132 988,555 1981-1984 7 1/4% 90% of 1965-70 Basic Select
plus Ultimate Linton B
4,772,595 4,713,069 1983-1988 9 1/2% 80% of 1965-70 Basic Select
plus Ultimate Linton B
14,031,404 12,459,045 1990-Present 8% 66% of 1975-80 Basic Select
plus Ultimate Linton B
Annuities:
21,779,771 25,202,605 1976-Present 5 1/2% Accumulation of Funds --
Miscellaneous:
16,939,829 15,161,153 1962-Present 2 1/2%-3 1/2% 1958-CSO None
</TABLE>
- ----------
* The above amounts are before deduction of deferred premiums of $936,565 in
1996 and $1,017,841 in 1995.
(b) The costs of acquiring new business, principally commissions and
related agency expenses, and certain costs of issuing policies, such as medical
examinations and inspection reports, all of which vary with and are primarily
related to the production of new business, have been deferred. Costs deferred on
universal life and variable life are amortized as a level percentage of the
present value of anticipated gross profits resulting from investment yields,
mortality and surrender charges. Costs deferred on traditional ordinary life and
health are amortized over the premium-paying period of the related policies in
proportion to the ratio of the annual premium revenue to the total anticipated
premium revenue. Anticipated premium revenue was estimated using the same
assumptions which were used for computing liabilities for future policy
benefits. Amortization of $1,454,408 in 1996, $1,672,429 in 1995 and $1,573,216
in 1994 was charged to operations.
(c) Participating business represented 9.8% and 11.1% of individual life
insurance in force at December 31, 1996 and 1995, respectively.
The Board of Directors annually approves a dividend formula for
calculation of dividends to be distributed to participating policyholders.
The portion of earnings of participating policies that can inure to the
benefit of shareholders is limited to the larger of 10% of such earnings or $.50
per thousand dollars of participating insurance in force. Earnings in excess of
that limit must be excluded from shareholders' equity by a charge against
operations. No such charge has been made, since participating business has
operated at a loss to date on a statutory basis. It is anticipated, however,
that the participating lines will be profitable over the lives of the policies.
(d) New York State insurance law prohibits the payment of dividends to
stockholders from any source other than the statutory unassigned surplus. The
amount of said surplus was $16,796,135, $11,815,645 and $8,235,339 at December
31, 1996, 1995 and 1994, respectively.
(e) Statutory due and deferred premiums are adjusted to conform to the
expected premium revenue used in computing future benefits and deferred policy
acquisition costs. In this regard, the GAAP due premium is recorded as an asset
and the GAAP deferred premium is applied against future policy benefits.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note 7 -- Federal Income Taxes
The Company joins with its parent company and other affiliated companies
in filing a consolidated Federal income tax return. The provision for Federal
income taxes is determined on a separate company basis.
Retained earnings at December 31, 1996 included approximately $146,000
which is defined as "policyholders' surplus" and may be subject to Federal
income tax at ordinary corporate rates under certain future conditions,
including distributions to stockholders.
Deferred tax liabilities (assets) are comprised of the following:
1996 1995
---- ----
Policyholder dividend provision ................. $ (332,719) $ (323,612)
Non-qualified agents' pension plan reserve ...... (1,127,384) (1,044,728)
Deferred policy acquisition costs ............... 2,507,526 2,968,214
Future policy benefits .......................... (2,346,908) (2,639,345)
Bond discount ................................... 28,677 27,842
Unrealized holding gains (losses) on
Available-For-Sale Securities 331,000 967,000
Other ........................................... 5,808 32,629
----------- -----------
$ (934,000) $ (12,000)
=========== ===========
The currently payable Federal Income tax provision of $3,099,000 for 1996
is net of a $75,000 Federal tax benefit resulting from a capital loss carryback
of $221,025 and the $838,000 for 1994 is net of a $102,000 Federal tax benefit
resulting from a capital loss carry back of $259,987.
A reconciliation of the Federal statutory income tax rate to the Company's
effective tax rate is as follows:
1996 1995 1994
---- ---- ----
Application of statutory tax rate........................ 34% 34% 34%
Special tax deduction for life insurance companies....... -- -- (18)
--- --- ---
....................................................... 34% 34% 16%
=== === ===
<PAGE>
FIRST INVESTORS LIFE VARIABLE ANNUITY FUND D
PART C: OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits
(a) Financial Statements:
No financial statements for Registrant are included in this
Registration Statement, because Registrant had not commenced
operations as of the effective date of this Registration Statement.
The financial statements for the period ending December 31, 1996 for
First Investors Life Insurance Company are included in Part B.
(b) Exhibits:
1. Resolution of the Board of Directors of First Investors Life
Insurance Company establishing Separate Account D. *
2. Safekeeping Agreement between First Investors Life Insurance
Company and United States Trust Company of New York. *
3. Distribution Contracts:
a. Underwriting Agreement between First Investors Life
Insurance Company and First Investors Corporation; * and
b. Specimen Variable Annuity Dealer Agreement between First
Investors Corporation and dealers. *
4. a. Specimen Individual Variable Annuity Contract issued by
First Investors Life Insurance Company for participation in
Separate Account D.
b. Specimen Individual Variable Annuity Contract issued by
First Investors Life Insurance Company providing for full
refund of premium payment and extension of ten-day
revocation period if Contract replaces another annuity
contract.
c. Specimen Individual Variable Annuity Contract issued by
First Investors Life Insurance Company providing for full
refund of premium payment and containing an endorsement
pertaining to minimum rate of return following death of
Annuitant.
<PAGE>
d. Specimen Individual Variable Annuity Contract issued by
First Investors Life Insurance Company providing for a full
refund of premium payment upon request for cancellation of
Contract prior to delivery of Contract.
5. Form of application used with Individual Variable Annuity
Contract provided in response to (4) above. *
6. a.(1) Declaration of Intention and Charter of First Investors
Life Insurance Company; *
(2) Certificate of Amendment; *
(3) Certificate of Amendment; *
(4) Certificate of Amendment; * and
(5) Certificate of Amendment. *
b. By-Laws of First Investors Life Insurance Company. *
7. Not applicable.
8. Not applicable.
9. Opinion and Consent of Tammie Lee, Esq., special counsel to
First Investors Life Insurance Company.
10. Consent of Independent Public Accountants.
11. Not applicable.
12. Not applicable.
13. Not applicable.
14. Not applicable.
15. Powers of Attorney. *
- -------------------------------------------
*Previously filed on May 1, 1997 in the initial filing of this Registration
Statement.
<PAGE>
ITEM 25. Directors and Officers of the Depositor
The following are the Directors and Officers of First investors Life Insurance
Company:
Position and Office
Name and with First Investors
Principal Business Address Life Insurance Company
--------------------------- -----------------------
(Unless otherwise noted, an individual's
business address is 95 Wall Street, New
York, New York 10005.)
Jay G. Baris Director
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, N.Y. 10022
Glenn T. Dallas Director
21 Eagle Nest Road
Morristown, N.J. 07960
William H. Drinkwater First Vice President & Chief
Actuary
George V. Ganter Director
Robert J. Grosso Director
581 Main Street
Woodbridge, N.J. 07095
William M. Lipkus Vice President & Chief Accounting
Officer
Glenn O. Head Chairman & Director
Kathryn S. Head Director
581 Main Street
Woodbridge, N.J. 07095
Scott Hodes Director
Arvey, Hodes, Costello & Burman
180 North LaSalle Street
Chicago, IL 60601
Carol Lerner Brown Secretary
<PAGE>
Position and Office
Name and with First Investors
Principal Business Address Life Insurance Company
--------------------------- -----------------------
(Unless otherwise noted, an individual's
business address is 95 Wall Street, New
York, New York 10005.)
Jackson Ream Director
Republic Bank of Dallas
P.O. Box 225961
Dallas, TX 75265
Nelson Schaenen, Jr. Director
Weiss, Peck & Greer
One New York Plaza
New York, New York 10004
John T. Sullivan Director
Ada M. Suchow Vice President & Assistant
Secretary
ITEM 26. Persons Controlled by or Under Common Control with the Depositor or
Registrant
There are no persons directly or indirectly controlled by or under common
control with the Registrant. Registrant is a separate account of First
Investors Life Insurance Company, the Depositor. Set forth below are all
persons controlled by or under common control with First Investors Life
Insurance Company:
ROUTE 33 REALTY CORPORATION (New Jersey). Ownership: 100% by First Investors
Life Insurance Company; Principal Business: Real Estate; Subsidiary of First
Investors Life Insurance Company.
FIRST INVESTORS CONSOLIDATED CORPORATION ("FICC") (Delaware). Ownership: Glenn
O. Head is the controlling shareholder; Principal Business: Holding Company;
Parent of First Investors Life Insurance Company.
ADMINISTRATIVE DATA MANAGEMENT CORP. (New York). Ownership: 100% owned by
FICC; Principal Business: Transfer Agent; Affiliate of First Investors Life
Insurance Company.
EXECUTIVE INVESTORS MANAGEMENT COMPANY, INC. (Delaware). Ownership: 100% owned
by FICC; Principal Business: Investment Advisor; Affiliate of First Investors
Life Insurance Company.
<PAGE>
FIRST INVESTORS ASSET MANAGEMENT COMPANY, INC. (Delaware). Ownership: 100%
owned by FICC; Principal Business: Investment Advisor; Affiliate of First
Investors Life Insurance Company.
FIRST INVESTORS CORPORATION (New York). Ownership: 100% owned by FICC;
Principal Business: Broker-Dealer; Affiliate of First Investors Life Insurance
Company.
FIRST INVESTORS LEVERAGE CORPORATION (New York). Ownership: 100% owned by
FICC; Principal Business: Inactive; Affiliate of First Investors Life Insurance
Company.
FIRST INVESTORS MANAGEMENT COMPANY, INC. (New York). Ownership: 100% of common
stock owned by FICC; Principal Business: Investment Advisor; Affiliate of First
Investors Life Insurance Company.
FIRST INVESTORS REALTY COMPANY, INC. (New Jersey). Ownership: 100% owned by
FICC; Principal Business: Real Estate; Affiliate of First Investors Life
Insurance Company.
FIRST INVESTORS RESOURCES, INC. (Delaware). Ownership: 100% owned by FICC;
Principal Business: Commodity Pool Operator; Affiliate of First Investors Life
Insurance Company.
EXECUTIVE INVESTORS CORPORATION (Delaware). Ownership: 100% owned by FICC;
Principal Business: Broker-Dealer; Affiliate of First Investors Life Insurance
Company.
FIRST FINANCIAL SAVINGS BANK, S.L.A. ("FFSB") (New Jersey). Ownership: 100%
owned by FICC, except Directors Qualifying Shares; Principal Business: Savings
and Loan; Affiliate of First Investors Life Insurance Company.
FIRST INVESTORS CREDIT CORPORATION (New Jersey). Ownership: 100% owned by
FICC; Principal Business: Real Estate; Affiliate of First Investors Life
Insurance Company.
N.A.K. REALTY CORPORATION (New Jersey). Ownership: 100% owned by FICC;
Principal Business: Real Estate; Affiliate of First Investors Life Insurance
Company.
REAL PROPERTY DEVELOPMENT CORPORATION (New Jersey). Ownership: 100% owned by
FICC; Principal Business: Real Estate; Affiliate of First Investors Life
Insurance Company.
FIRST INVESTORS CREDIT FUNDING CORPORATION (New York). Ownership: 100% owned
by FICC; Principal Business: Sells commercial paper; Affiliate of First
Investors Life Insurance Company.
SCHOOL FINANCIAL MANAGEMENT SERVICES, INC. (Ohio). Ownership: 100% owned by
FICC; Principal Business: Tuition assistance program; Affiliate of First
Investors Life Insurance Company.
<PAGE>
SPECIALTY INSURANCE GROUP, INC. (Delaware) Ownership: 100% owned by FICC;
Principal Business: Sells specialty insurance to non-profit organizations and
private and parochial schools; Affiliate of First Investors Life Insurance
Company.
ITEM 27. Number of Contractowners
Not Applicable
ITEM 28. Indemnification
Article XIV of the By-Laws of First Investors Life Insurance Company
provides as follows:
"To the full extent authorized by law and by the Charter, the
Corporation shall and hereby does indemnify any person who shall at
any time be made, or threatened to be made, a party in any civil or
criminal action or proceeding by reason of the fact that he, his
testator or his intestate is or was a director or officer of the
Corporation or served another corporation in any capacity at the
request of the Corporation, provided, that the notice required by
Section 62-a of the Insurance Law of the State of New York, as now in
effect or as amended from time to time, be filed with the
Superintendent of Insurance."
Reference is hereby made to the New York Business Corporation Law, Sections
721 through 725.
The general effect of this Indemnification will be to indemnify any person
made, or threatened to be made, a party to an action by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that the
person, or that person's testator or intestate, is or was a director or officer
of the corporation, or is or was serving at the request of the corporation as a
director or officer of any other corporation of any type or kind, domestic or
foreign, of any partnership, joint venture, trust, employee benefit plan or
other enterprise, against amounts paid in settlement and reasonable expenses,
including attorney's fees, actually and necessarily incurred in connection with
the defense or settlement of such action, or in connection with an appeal
therein if such director or officer acted in good faith, for a purpose
reasonably believed by that person to be in, and not opposed to, the best
interests of the corporation and not otherwise knowingly unlawful.
A directors and officers liability policy in the amount of $3,000,000
covering First Investors Life's directors and officers has been issued by the
Great American Insurance Companies.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
First Investors Life
<PAGE>
Variable Annuity Fund D pursuant to the foregoing provisions, or otherwise, the
First Investors Life Variable Annuity Fund D 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 First Investors Life Variable Annuity Fund D of expenses
incurred or paid by a director, officer or controlling person of the First
Investors Life Variable Annuity Fund D 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 First Investors Life
Variable Annuity Fund D 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 policy
as expressed in the Act and will be governed by the final adjudication of such
issue.
ITEM 29. Principal Underwriters
(a) First Investors Corporation, Underwriter of the Registrant, is also
Underwriter for:
First Investors Cash Management Fund, Inc.
First Investors Fund For Income, Inc.
First Investors Series Fund
First Investors Government Fund, Inc.
First Investors High Yield Fund, Inc.
First Investors Global Fund, Inc.
First Investors Multi-State Insured Tax Free Fund
First Investors New York Insured Tax Free Fund, Inc.
First Investors Insured Tax Exempt Fund, Inc.
First Investors Tax-Exempt Money Market Fund, Inc.
First Investors U.S. Government Plus Fund
First Investors Series Fund II, Inc.
First Investors Life Variable Annuity Fund A
First Investors Life Level Premium Variable Life Insurance
(Separate Account B)
First Investors Life Variable Annuity Fund C
First Investors Corporation is Sponsor of:
First Investors Single Payment and Periodic Payment Plans I for
Investment in First Investors Global Fund, Inc.
First Investors Single Payment and Periodic Payment Plans II for
Investment in First Investors Global Fund, Inc.
First Investors Single Payment and Periodic Payment Plans for
Investment in First Investors Fund For Income, Inc.
<PAGE>
First Investors Single Payment and Periodic Payment Plans for
Investment in First Investors Government Fund, Inc.
First Investors Periodic Payment Plans for Investment in First
Investors High Yield Fund, Inc.
First Investors Single Payment and Periodic Payment Plans for the
Accumulation of Shares of First Investors Global Fund, Inc.
First Investors Single Payment and Periodic Payment Plans for
Investment in First Investors Insured Tax Exempt Fund, Inc.
(b) The following persons are the officers and directors of First
Investors Corporation:
Name and Principal Position and Office with
Business Address (continued) First Investors Corporation
---------------------------- ---------------------------
(Unless otherwise noted, an individual's
business address is 95 Wall Street, New
York, New York 10005)
Joseph I. Benedek Treasurer
581 Main Street
Woodbridge, New Jersey 07095
Howard M. Factor Vice President
Lawrence A. Fauci Senior Vice President and
Director
Glenn O. Head Chairman and Director
Kathryn S. Head Vice President, Chief
581 Main Street Financial Officer and Director
Woodbridge, New Jersey 07095
Marvin Hecker President
Jane W. Kruzan Director
Larry R. Lavoie Secretary and General Counsel
Jeremiah J. Lyons Director
Frederick Miller Senior Vice President
581 Main Street
Woodbridge, New Jersey 07095
<PAGE>
Name and Principal Position and Office with
Business Address (continued) First Investors Corporation
---------------------------- ----------------------------
(Unless otherwise noted, an individual's
business address is 95 Wall Street, New
York, New York 10005)
Elizabeth Reilly Vice President
581 Main Street
Woodbridge, New Jersey 07095
Louis Rinaldi Senior Vice President
581 Main Street
Woodbridge, New Jersey 07095
Matthew Smith Vice President
581 Main Street
Woodbridge, New Jersey 07095
John T. Sullivan Director
ITEM 30. Location of Accounts and Records
All accounts, books and other documents required to be maintained pursuant
to Section 31(a) of the Investment Company Act of 1940, as amended, are located
at the offices of Registrant, 95 Wall Street, New York, New York.
ITEM 31. Management Services
Not applicable.
ITEM 32. Undertakings
Registrant hereby makes the following undertakings:
(a) An undertaking to file a post-effective amendment to this registration
statement as frequently as is 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) An undertaking 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
<PAGE>
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 to send for a Statement of Additional
Information;
(c) An undertaking 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) REPRESENTATION REGARDING REASONABLENESS AGGREGATE CHARGES
DEDUCTED UNDER THE CONTRACTS PURSUANT TO SECTION 26(e)(2)(A) THE
INVESTMENT COMPANY ACT OF 1940
First Investors Life Insurance Company ("First Investors Life")
represents that the fees and charges deducted under the Contracts that
are identified as Contract Form VAC (CDSC) and described in this
Registration Statement, in the aggregate, are reasonable in relation
to the services rendered, the expenses expected to be incurred, and
the risks assumed by First Investors Life under the Contracts. First
Investors Life bases it representation on its assessment of all of the
facts and circumstances, including such relevant factors, as the
nature and extent of such services, expenses and risks; the need for
First Investors Life to earn a profit; and the regulatory standards
for exemptive relief under the Investment Company Act of 1940 used
prior to October 1996, including the range of industry practice.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Pre-Effective Amendment
No. l to this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of July, 1997.
FIRST INVESTORS LIFE VARIABLE
ANNUITY FUND D
(Registrant)
By /s/ Richard H. Gaebler
----------------------------------------
Richard H. Gaebler, President
First Investors Life Insurance
Company
FIRST INVESTORS LIFE INSURANCE
COMPANY
(Depositor)
By /s/ Richard H. Gaebler
----------------------------------------
Richard H. Gaebler
President
As required by the Securities Act of 1933, this Pre-Effective Amendment No.
1 to this Registration Statement has been signed below by the following officers
and directors of the Depositor in the capacities and on the dates indicated:
SIGNATURE TITLE DATE
/s/ Richard H. Gaebler President and Director July 3, 1997
- -------------------------
Richard H. Gaebler
/s/ William M. Lipkus Vice President and July 3, 1997
- ------------------------- Chief Accounting
William M. Lipkus Officer and Chief
Financial Officer
<PAGE>
Glenn O. Head* Chairman and Director July 3, 1997
Jay G. Baris* Director July 3, 1997
George V. Ganter* Director July 3, 1997
Robert J. Grosso* Director July 3, 1997
Scott Hodes* Director July 3, 1997
Jackson Ream Director July 3, 1997
Nelson Schaenen Jr.* Director July 3, 1997
John T. Sullivan* Director July 3, 1997
Kathryn S. Head* Director July 3, 1997
Glenn T. Dallas* Director July 3, 1997
* By: /s/ Richard H. Gaebler
----------------------
Richard H. Gaebler
Attorney-In-Fact
Pursuant to Power of
Attorney
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
- ------
99.N4.4A Specimen Individual Variable Annuity
Contract
99.N4.4B Specimen Individual Variable Annuity
Contract
99.N4.4C Specimen Individual Variable Annuity
Contract
99.N4.4D Specimen Individual Variable Annuity
Contract
99.N4.9 Opinion and Consent of Counsel
99.N4.10 Consent of Independent Public
Accountants
<PAGE>
VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity CONTRACT
With Additional Purchase Payment Option NUMBER
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or Annuitant
Fixed Basis
Date of Issue
Non-Participating
Issue Age
FIL
FIRST INVESTORS Purchase Payment
LIFE INSURANCE COMPANY
Maturity Date
First Investors Life agrees to pay the benefits and other rights described in
this contract in accord with the terms of this contract.
Signed for First Investors Life Insurance Company at its Home Office in New
York, New York.
/s/Richard H. Gaebler
Richard H. Gaebler, President
/s/Carol L. Brown
Carol L. Brown, Secretary
10-DAY RIGHT TO EXAMINE CONTRACT
During a period of 10 days from the date this contract is delivered to the
Owner, it may be surrendered to the Company together with a written request for
cancellation of the contract and, in such event, the Company will pay to the
Owner an amount equal to the sum of (i) the difference between the Single
Purchase Payment made under this Contract and the amount allocated to the
Separate Account under this Contract and (ii) the Accumulated Value of this
Contract on the date of surrender.
<PAGE>
THE ANNUAL INVESTMENT RETURN REQUIRED TO MAINTAIN LEVEL VARIABLE ANNUITY
PAYMENTS IS 5.65% (AFTER ANY APPLICABLE TAXES, BUT BEFORE ASSET CHARGES TOTALING
1.4% FOR MORTALITY RISKS, EXPENSE RISKS AND CONTRACT MAINTENANCE CHARGES AND
MANAGEMENT FEES WHICH WILL NOT EXCEED .75% OF NET ASSETS OF MUTUAL FUND IN WHICH
SEPARATE ACCOUNT ASSETS ARE INVESTED). ANNUITY PAYMENTS AND OTHER VALUES
PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT EXPERIENCE OF A SEPARATE
ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO FIXED-DOLLAR AMOUNT.
2
<PAGE>
CONTRACT DATA CONTRACT NUMBER 310000
ANNUITANT JOHN A. DOE
DATE OF ISSUE MARCH 14, 1997
ISSUE AGE 35
PURCHASE PAYMENT $25,000.00
MATURITY DATE MARCH 14, 2052
SEPARATE ACCOUNT
FIRST INVESTORS LIFE SEPARATE ACCOUNT D
MUTUAL FUND
FIRST INVESTORS LIFE SERIES FUND
PURCHASE PAYMENT WILL BE ALLOCATED
AS FOLLOWS:
25% to High Yield Series
25% to Discovery Series
25% to Growth Series
25% to Blue chip Series
UNIT EFFECTIVE DATE
MARCH 1, 1997
OWNER
ANNUITANT
BENEFICIARY DESIGNATION
REFER TO ENCLOSED APPLICATION
CONTINGENT DEFERRED SALES CHARGE UPON SURRENDER
REFER TO PAGE 9
3
<PAGE>
ALPHABETICAL GUIDE
PAGE
ACCUMULATION OF UNITS. . . . . . . . . . . . . . . . . . . . . . . . . . .5
ACCUMULATION UNIT VALUE. . . . . . . . . . . . . . . . . . . . . . . . . .6
ADDITIONAL PURCHASE PAYMENT. . . . . . . . . . . . . . . . . . . . . . . .5
ADJUSTMENT OF MONTHLY PAYMENT. . . . . . . . . . . . . . . . . . . . . . .7
ALLOCATION OF ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . .7
AMOUNT OF FIRST ANNUITY PAYMENT. . . . . . . . . . . . . . . . . . . . . .6
ANNUITY TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ANNUITY UNIT VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
BENEFICIARY CHANGE . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
BENEFICIARY DESIGNATION. . . . . . . . . . . . . . . . . . . . . . . . . .9
CHANGE OF CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
CHARGES AGAINST THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . .6
CHOICE OF ANNUITY OPTION . . . . . . . . . . . . . . . . . . . . . . . . .6
CLAIMS OF CREDITORS. . . . . . . . . . . . . . . . . . . . . . . . . . . .5
CONTINGENT DEFERRED SALES CHARGE . . . . . . . . . . . . . . . . . . . . .9
CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
CONTRACT MAINTENANCE CHARGE. . . . . . . . . . . . . . . . . . . . . . . .6
CONTROL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
DEATH OF ANNUITANT . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
DEATH OF BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . .9
DEATH OF OWNER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
ELECTION OF ANNUITY OPTIONS. . . . . . . . . . . . . . . . . . . . . . . .7
FIXED ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
INCONTESTABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
INITIAL PURCHASE PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . .5
INVESTMENT OF THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . .5
MATURITY DATE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
MISSTATEMENT OF AGE OR SEX . . . . . . . . . . . . . . . . . . . . . . . .4
MORE FAVORABLE PAYMENT OPTION. . . . . . . . . . . . . . . . . . . . . . .7
NET INVESTMENT FACTOR. . . . . . . . . . . . . . . . . . . . . . . . . . .6
NONPARTICIPATING . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
OWNERSHIP OF THE ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . .4
PROOF OF AGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
PROOF OF SURVIVAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
REPORTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
SEPARATE ACCOUNT - GENERAL . . . . . . . . . . . . . . . . . . . . . . . .5
SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
SURRENDER OPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
VALUATION OF ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . .6
VARIABLE ANNUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
VOTING RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE . . . . . . . . . . . . . . . . . .9
POLICY PROVISIONS
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
PURCHASE PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
BENEFICIARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
4
<PAGE>
GENERAL PROVISIONS
1. DEFINITIONS
As used in this Contract, the term:
(a) "Separate Account" means the account shown as such on page 3.
(b) "Valuation Date" means any date on which the New York Stock Exchange is
open for trading;
(c) "Valuation Period" means the period starting on the day after any Valuation
Date and ending on the next such Date;
(d) "Accumulation Unit" means a unit used to measure the value of an Owner's
interest in the Separate Account prior to the date on which annuity payments
commence;
(e) "Annuity Unit" means a unit used to determine the amount of each annuity
payment after the first;
(f) "Accumulated Value" means the value of all the Accumulation Units credited
to this Contract.
(g) "Purchase Payment" means an amount paid to the Company under this Contract
as a payment for the benefits described herein;
(h) "Variable Annuity" means an annuity with annuity payments varying in amount
in accordance with the net investment experience of the Separate Account;
(i) "Fixed-Dollar Annuity" means an annuity with annuity payments which stay
fixed as to dollar amount throughout the payment period;
(j) "Attained Age" of the annuitant on any date after the Date of Issue means
the age of the Annuitant at issue as shown on page 3 plus the number of years
elapsed from the Date of Issue to such date; and
(k) "Annuity Commencement Date" means the date on which annuity payments are to
commence. Also referred to as "Maturity Date" in this contract.
2. CONTRACT
This Contract, the application, and any riders attached to this Contract
constitute the whole contract. Only the President, a Vice President, the
Secretary, or an Assistant Secretary of the Company has the power, on behalf of
the Company, to change, modify or waive any provisions of this Contract. Any
changes, modifications, or waivers must be in writing. The Company will not be
bound by any promises or representations made by any agent or other person
except as specified above.
3. CONTROL
Consistent with the terms of any beneficiary designation and any assignment, the
Owner may, during the lifetime of the Annuitant:
1. assign this Contract or surrender it in whole or in part;
2. amend or change this Contract with the consent of the Company; and
3. exercise any right, receive any benefit, or enjoy any privilege in this
Contract.
The Company reserves the right to require this Contract for endorsement of any
assignment or change.
4. INCONTESTABILITY
This Contract will not be contested.
5. MISSTATEMENT OF AGE OR SEX
If the age or the sex of the Annuitant has been misstated, the benefits in this
Contract will be those which the Single Purchase Payment would have bought for
the right age and sex. Any amounts which should have been in the payments made
by the Company before the error was found will be made up right away. The
Company will pay interest at the rate of 6% per year on this additional amount.
Any excess amounts in the payments made by the Company before the error was
found will be charged against the payments which are due later.
5
<PAGE>
6. ASSIGNMENT
No assignment of this Contract shall be binding on the Company unless it is in
writing and filed with the Company at its Home Office. The Company will assume
no responsibility of the validity or sufficiency of any assignment. Unless
otherwise provided in the assignment, the interest of any revocable beneficiary
shall be subordinate to the interest of any assignee, regardless of when the
assignment was made and the assignee shall receive any sum payable to the extent
of his interest.
7. OWNERSHIP OF THE ASSETS
The Company shall have exclusive and absolute ownership and control of its
assets, including all assets in the Separate Account.
8. VOTING RIGHTS
The Owner shall have the right to vote only at the meetings of the Fund.
Ownership of this Contract shall not entitle any person to vote at any meeting
of shareholders of the Company. Votes attributable to the Contract shall be
cast in conformity with applicable law.
9. REPORTS
At least once each Contract Year the Company shall mail a report to the Owner.
The report shall be mailed to the last address known to the Company. The report
shall include a statement of the number of units credited to this Contract and
the dollar value of such units. The information in the report shall be as of a
date not more than two months prior to the date of mailing the report. The
Company shall also mail to the Owner at least once in each Contract Year, a
report of the investments held in the Separate Account under this Contract.
10. PROOF OF AGE
Any annuity payment will be subject to proof of age of the payee which the
company will accept.
11. PROOF OF SURVIVAL
The Company has the right to ask for proof that the person on whom the payment
is based is alive when each payment is due.
12. SETTLEMENT
Any payment by the Company under this Contract is payable at its Home Office.
13. CLAIMS OF CREDITORS
To the extent allowed by law, Proceeds will not be subject to any claims of
creditors.
14. CHANGE OF CONTRACT
The Company keeps the right to change this Contract to meet the requirements of
the Investment Company Act of 1940 or other applicable federal or state laws or
regulations.
15. NONPARTICIPATING
This Contract is nonparticipating. It will not share in the surplus earnings of
the Company.
PURCHASE PAYMENTS
16. INITIAL PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue. The minimum Single
Purchase Payment which may be made is $25,000.
The Company will use the Initial Purchase Payment on the day it is received at
the Home Office to provide accumulation units, the number of which will be based
on that day's value of such units.
6
<PAGE>
17. ADDITIONAL PURCHASE PAYMENT OPTION
Additional Purchase Payments may be made at the option of the Owner at any time
up to the Maturity Date.
The Company will use the Additional Purchase Payment on the day it is received
at the Home Office to provide accumulation units, the number of which will be
based on that day's value of such units.
SEPARATE ACCOUNT
18. GENERAL
The Separate Account is a segregated investment account maintained by the
Company. A part of the assets of the Separate Account have been allocated for
this and certain other Contracts. The assets of the Separate Account are held
apart from the assets of the Company. Charges against these assets do not arise
out of any other business of the Company.
19. INVESTMENTS OF THE SEPARATE ACCOUNT
The assets of the Separate Account will be invested in shares of the mutual fund
shown on page 3 ("Fund"). The Fund is registered under the Investment Company
Act of 1940, as amended (the "Act").
The assets of each subaccount will be invested, as requested in the application
or as later requested in writing, in shares of the corresponding series of the
Fund shown on page 3. The assets may be allocated among at least one but not
more than five subaccounts. The Owner can change the allocation among the
subaccounts by furnishing notice to the Home Office. The change will take
effect when the Company receives this notice.
The Company may, in its discretion, invest the assets in shares of any other
fund or investment allowed by law.
All distributions from the Fund will be reinvested and kept as assets. When
needed to pay for surrenders, shares of the Fund held by the Separate Account
will be redeemed at net asset value.
20. ACCUMULATION UNITS
This Contract will be credited with the number of Accumulation Units of each
subaccount of the Separate Account bought by the amount of the Purchase Payment
allocated to each subaccount of the Separate Account.
This Contract will also be credited with the number of Accumulation Units of
each subaccount of the Separate Account bought by the amount of any Additional
Purchase Payment allocated to each subaccount of the Separate Account.
21a. CHARGES AGAINST THE SEPARATE ACCOUNT
The Company deducts an amount equal on a yearly basis to 1.4% of the daily net
asset value of each subaccount comprised of 1.25% to pay it for taking on
mortality and expense risks and .15% for taking on expenses related to
administration of the Contract.
21b. CONTRACT MAINTENANCE CHARGE
On the last business day of each Contract Year or on the date of surrender of
this Contract, if earlier, the Company will deduct a $30.00 Contract
Maintenance Charge from the Accumulated Value but in no case will this charge
exceed 2% of such value. It will be charged against the Accumulated Value by
proportionately reducing the number of Accumulation Units held on that date with
respect to each active subaccount of the Separate Account.
22. NET INVESTMENT FACTOR
The net investment factor for a subaccount of the Separate Account for any
Valuation Period is obtained by dividing (a) by (b) and subtracting (c) from the
result, where:
7
<PAGE>
(a) is the result of:
(1) the net asset value per share of the series of the Fund at the
end of the current Valuation Period, plus:
(2) the per share amount of any dividend or capital gains
distributions made by the series of the Fund during the current Valuation
Period, plus or minus:
(3) a per share charge or credit for any taxes reserved for.
(b) is the result of:
(1) the net asset value per share of the series of the Fund as of the
end of the preceding Valuation Period, plus or minus:
(2) the per share charge or credit for any taxes reserved for the
preceding Valuation Period.
(c) is a factor for the charges shown in Section 21a.
23. VALUATION OF ASSETS
Fund shares held in the Separate Account will be valued at their net asset
value. Other assets will be valued at fair market value.
24. ACCUMULATION UNIT VALUE
The value of an Accumulation Unit was set at $10.00 on the Unit Effective Date.
The value for a later period is obtained by multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end. The unit value may rise or fall based on investment results.
25. ANNUITY UNIT VALUE
The value of an Annuity Unit was set at $10.00 on the Unit Effective Date. The
value for a later period is obtained by first multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end and then multiplying the result by a factor which offsets the effect
of the assumed interest rate of 3.5% per year built into the table used in the
Contract.
BENEFITS
26. MATURITY DATE
Annuity payments will start on the Maturity Date shown on page 3. On written
request, it may be changed. But it will not be deferred beyond the Contract
Anniversary on which the attained age of the Annuitant is 90.
27. CHOICE OF ANNUITY OPTION
A choice of Annuity Option should be made by the Owner at least 30 days before
the Maturity Date.
If a choice is not made on time, payments will start on the Maturity Date on a
Variable Annuity basis with the Annuity Option as 10 years certain or life.
Once payments start, no further choice is allowed.
28. AMOUNT OF FIRST ANNUITY PAYMENT
Seven (7) days before the Maturity Date, any premium taxes not yet deducted will
be deducted from the Accumulated Value to determine the Net Accumulated Value.
Such value will then be applied to the proper Annuity Table on page 10 or 11 to
determine the amount of the first monthly annuity payment.
The amount of each payment depends on the sex and adjusted age of the Annuitant
and Joint Annuitant, if any, at the Maturity Date. The adjusted age is
determined at the time the first payment is due. For a payee born prior to
1900, the adjusted age is the actual age. For a payee born 1900 or
8
<PAGE>
later, the adjusted age is the actual age minus four years and also minus one
year for each completed five years during the period from 1900 to the payee's
year of birth.
The Company may, at its option, credit interest above the 3.5% per year rate
built into the tables used in this Contract.
29. ALLOCATION OF ANNUITY
When the Owner makes a choice as to annuity option, he or she will also choose
between a Fixed Annuity, a Variable Annuity or any combination of the two. If a
choice is not made at least 30 days before the Maturity Date, as stated in
Section 27, payments will be made on a Variable Annuity basis.
30. VARIABLE ANNUITY
A Variable Annuity is one with payments which vary as to dollar amount through
the annuity period based on the investment results of the Separate Account. The
method by which the amount of the first monthly payment is determined is shown
in Section 28.
Each payment for any due date after the first will be determined by multiplying
the Annuity Unit Value on the date seven days prior to the date on which the
payment is due by a constant number of Annuity Units. The payment may be less
than or greater than the preceding payment.
The constant number of Units is determined by dividing the dollar amount of the
first payment by the then current value of an Annuity Unit on the date the first
payment is due.
The Company guarantees that the dollar amount of each payment after the first
will not be affected by variations in mortality or expense experience from the
mortality and expense assumptions on which the first payment is based.
31. FIXED ANNUITY
A Fixed Annuity is one with payments which stay fixed as to dollar amount
through the annuity period. The method by which the amount of the first monthly
payment is determined is shown in Section 28. Later payments will not be less
than the first but a later payment may be more than the first if the Company
credits interest above the rate built into the tables.
32. ADJUSTMENT OF MONTHLY PAYMENT
If the Net Accumulated Value on the Maturity Date is less than $2,000, the
Company shall have the right to pay such value in one sum in lieu of payments
otherwise provided for. If the Net Accumulated Value is not less than $2,000
but either the Variable Annuity or the Fixed Annuity Payments provided for would
be or become less than $20, the Company shall have the right to change the
frequency of payment to such intervals as will result in payments of at least
$20.
33. MORE FAVORABLE PAYMENT OPTION
At the time fixed annuity payments begin, the single premium fixed annuity rates
then in use by the Company will be used if they provide a payment amount to the
payee greater than that shown in the table on page 10 or 11. Each $1,000 of
cash value shall be considered to be $1,030 for the purpose of using the single
premium annuity rates.
34. ELECTION OF ANNUITY OPTIONS
The owner may elect to have annuity payments made under any one of the Annuity
Options described below or in any other manner agreeable to the Company. Any
such election shall be made in writing to the Company at its Home Office at
least 30 days before the Maturity Date. The election may be changed in the same
manner at any time prior to the surrender of this Contract. If the amount of
payments for different guaranteed periods are the same at any given age, the
Company will deem the longer period certain to have been chosen.
OPTION 1 - LIFE ANNUITY - An annuity payable monthly during the lifetime of the
Annuitant, ceasing with the last payment due prior to his or her death.
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - an annuity payable monthly during
the joint lifetime of the
9
<PAGE>
Annuitant and the Joint Annuitant and continuing, after the death of either,
during the lifetime of the survivor, ceasing with the last payment due prior to
the death of the survivor.
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
two-thirds payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
one-half payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 3 - LIFE ANNUITY WITH 60, 120 OR 240 MONTHLY PAYMENTS GUARANTEED - An
annuity payable monthly during the lifetime of the Annuitant, with the guarantee
that if, at his or her death, payments have been made for less than 60, 120 or
240 monthly period, as elected, any guaranteed annuity payments will be
continued during the remainder of the selected period to the Beneficiary.
OPTION 4 - UNIT REFUND LIFE ANNUITY - An annuity payable monthly during the
lifetime of the Annuitant, with the last payment due prior to his or her death,
provided further that, at such death, the Beneficiary will receive an additional
payment of the then dollar value of the number of Annuity Units equal to the
excess, if any, of (a) over (b) where (a) is the total amount applied under the
option divided by the Annuity Unit Value at the Maturity Date and (b) is the
product of the number of Annuity Units represented by each payment and the
number of payments made.
When this option is applied as a Fixed Annuity (a) shall be the Accumulated
Value applied at the Maturity Date to the Fixed Annuity, (b) shall be the sum of
all Fixed Annuity Payments made.
35. DEATH OF ANNUITANT
On receipt of due proof of the death of the Annuitant before Annuity Payments
have begun, the Company will pay the Death Benefit to the Beneficiary as of the
day on which such due proof is received by the Company. The Death Benefit will
be the greatest of the following amounts:
(a) The Accumulated Value on the date of receipt of Due Proof of Death at
the Home Office of the Company;
(b) The Accumulated Value on the Specified Contract Anniversary
immediately preceding the date of death, increased by the dollar
amount of any purchase payments made and reduced by the dollar
amount of any partial withdrawals since the immediately preceding
Specified Contract Anniversary;
or
(c) 100% of all purchase payments made under the Contract, reduced by the
dollar amount of any partial withdrawals since the Date of Issue.
The Specified Contract Anniversary is every seventh contract anniversary (i.e.
7th, 14th, 21st, etc.)
If the Annuitant and the Owner are one in the same at the time of the
Annuitant's death and the proceeds are payable to (or for the benefit of) the
Annuitant's surviving spouse, such spouse shall have the right to become the
Annuitant under the contract. If the Annuitant dies at a time when the Owner of
the contract is not an individual, the Annuitant will be considered to be the
Owner for the purpose of this section.
On receipt of due proof of death of the Annuitant after Annuity Payments have
begun under an Annuity Option, if any payments remain under the Option they will
be paid to the Beneficiary as provided by the Option.
Unless otherwise provided in the Beneficiary designation, if no Beneficiary
survives the Annuitant, the proceeds will be paid in one sum to the Owner, if
living; otherwise, to the Owner's estate.
36. DEATH OF OWNER
The purpose of this Section is to qualify this Contract as an annuity contract
in accordance with Section 72(s) of the Internal Revenue Code of 1986, as
amended ("Code"). Its provisions shall apply notwithstanding any other
provisions of the Contract in conflict therewith.
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In the event any Owner of this Contract who is not the Annuitant dies on or
after the Maturity Date and before the entire interest in the Contract has been
distributed, the remaining portion of such interest will be distributed at least
as rapidly as under the Annuity Option in effect as of the Date of the Owner's
death.
In the event any Owner of this Contract who is not the Annuitant dies prior to
the Maturity Date, the entire interest of that Owner in this Contract shall be
distributed to the Beneficiary within five years after the Owner's death, or
distributed under an Annuity Option providing for annuity payments over the life
of such Beneficiary or over a period not extending beyond the life expectancy of
such Beneficiary (in accordance with the regulations the Secretary of the
Treasury may prescribe), if such payments begin within one year after the date
of the Owner's death or such later date as the Secretary of the Treasury may
prescribe by regulations. In addition, if any portion of the Owner's interest
in this Contract is payable to (or for the benefit of) the Owner's surviving
spouse, that spouse shall be deemed to have been designated by the Owner as a
"designated beneficiary" for purpose of Section 72(s) of the Code, and shall be
treated as the Owner, and no distributions described hereinabove shall be
required, with respect to that portion of the Contract payable to (or for the
benefit of) such spouse. If the Owner who dies is the one named in the original
application for this Contract, the entire interest of that Owner in this
Contract will be the same as if the Owner had been the Annuitant; if the Owner
who dies is not the one named in the original application for this Contract, the
entire interest of that Owner shall be the Accumulated Value of this Contract.
37. SURRENDER OPTION
The Owner may turn this Contract in for its Surrender Value effective on the
date on which the request in writing is received at the Home Office. The value
will be the Accumulated Value on that date less (a) a Contingent Deferred Sales
Charge, if any, (b) the Contract Maintenance Charge and (c) any applicable
premium taxes not previously deducted.
Any cash payment will be mailed within 7 days after receipt of a proper request;
but the Company may be allowed to defer the payment under the Investment Company
Act of 1940 as it is in effect at that time. The Surrender Option is not
available after the Maturity Date.
38. WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE
The Owner may withdraw a part of the Surrender Value of this Contract effective
on the date on which the request in writing is received at the Home Office at
any time prior to the Maturity Date provided the Surrender Value remaining after
the surrender is at least equal to the Company's minimum amount rules then in
effect. If the remaining Surrender Value following such surrender is less than
the Company's minimum amount rules, the Company will terminate the contract and
pay the Surrender Value.
If applicable, a Contingent Deferred Sales Charge will be assessed against any
Accumulated Value surrendered. However, on a noncumulative basis, the Owner may
make partial surrenders during any Contract Year prior to the Maturity Date, up
to the Annual Withdrawal Privilege Amount of 10% of Purchase Payments and the
Contingent Deferred Sales Charge will not be assessed against such amounts.
Any Withdrawal Privilege Amount surrenders will be deemed to be from Accumulated
Values other than purchase payments. Surrender of Accumulated Values in excess
of the Withdrawal Privilege Amount and additional surrenders made in any
Contract Year will be subject to the Contingent Deferred Sales Charge, if
applicable.
39. CONTINGENT DEFERRED SALES CHARGE
A Contingent Deferred Sales Charge may be assessed against the Accumulated Value
when surrendered. The length of time from receipt of the purchase payment to
the time of surrender determines the charge. For this purpose, Purchase
Payments will be deemed to be surrendered in the order in which they were
received and all surrenders will be first from Purchase Payments and then from
other contract values. This charge is a percentage of the amount withdrawn (not
to exceed the aggregate amount of the Purchase Payments made) and equals:
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Length of time from
Contingent Deferred Purchase Payment
Sales Charge (Number of years)
------------ -----------------
7% Less than 1
6% 1 - 2
5% 2 - 3
4% 3 - 4
3% 4 - 5
2% 5 - 6
1% 6 - 7
None More than 7
No Contingent Deferred Sales Charges will be assessed in the event of the death
of the Annuitant or the Owner (as applicable), or if contract values are applied
to an annuity option provided for under this contract or upon the exercise of
the Withdrawal Privilege.
BENEFICIARY
40. BENEFICIARY DESIGNATION
The Beneficiary will be as named in the application for this Contract unless the
designation has been changed by the Owner.
41. BENEFICIARY CHANGE
The Owner may change the designation while the Annuitant is alive unless
otherwise provided in the previous designation.
A change may be made by filing a written request with the Home Office. The
request must be in a form acceptable to the Company. The Company may require
this Contract for endorsement of a change.
42. DEATH OF BENEFICIARY
Unless otherwise provided, if any Beneficiary dies before the Annuitant, his or
her interest will pass to any other Beneficiaries according to their respective
interests.
If the Beneficiary dies while receiving any remaining Annuity Payments due after
the death of the Annuitant, the value of the remainder of such Annuity Payments
will be paid in one sum to the Beneficiary's estate.
12
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ANNUITY TABLES
DOLLAR AMOUNT OF THE MONTHLY ANNUITY PAYMENT WHICH
IS PURCHASED WITH EACH $1,000 OF PROCEEDS APPLIED
OPTION 1,3 AND 4 - SINGLE LIFE ANNUITIES
Monthly Payments Guaranteed
Unit
Refund
Adjusted Age None 60 120 240
Male Female Option 1 Option 3 Option 3 Option 3 Option 4
50 54 $4.74 $4.73 $4.69 $4.52 $4.53
51 55 4.84 4.82 4.78 4.58 4.60
52 56 4.94 4.92 4.87 4.65 4.67
53 57 5.04 5.03 4.97 4.71 4.75
54 58 5.16 5.14 5.07 4.78 4.84
55 59 5.28 5.25 5.18 4.85 4.93
56 60 5.40 5.38 5.29 4.91 5.02
57 61 5.54 5.51 5.41 4.98 5.12
58 62 5.69 5.65 5.53 5.05 5.22
59 63 5.84 5.80 5.66 5.11 5.32
60 64 6.01 5.95 5.79 5.18 5.44
61 65 6.18 6.12 5.94 5.24 5.56
62 66 6.37 6.30 6.08 5.30 5.68
63 67 6.57 6.49 6.24 5.36 5.82
64 68 6.79 6.69 6.40 5.41 5.96
65 69 7.02 6.91 6.57 5.46 6.10
66 70 7.27 7.14 6.74 5.51 6.26
67 71 7.54 7.38 6.91 5.55 6.43
68 72 7.83 7.64 7.10 5.59 6.60
69 73 8.14 7.91 7.28 5.62 6.78
70 74 8.48 8.20 7.47 5.65 6.98
71 75 8.84 8.51 7.66 5.68 7.19
72 76 9.23 8.84 7.85 5.70 7.41
73 77 9.65 9.18 8.04 5.71 7.65
74 78 10.11 9.55 8.23 5.72 7.89
75 79 10.61 9.93 8.41 5.73 8.16
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.21 $4.35 $4.40 $4.47
55 59 4.37 4.58 4.66 4.78
57 61 4.43 4.67 4.77 4.90
60 64 4.51 4.80 4.92 5.00
62 66 4.55 4.88 5.01 5.22
65 69 4.62 4.99 5.15 5.39
70 74 4.70 5.14 5.34 5.65
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
13
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OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - Cont'd
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $4.51 $4.57 $4.64
55 59 4.85 4.94 5.07
57 61 4.99 5.10 5.26
60 64 5.20 5.36 5.59
62 66 5.35 5.54 5.82
65 69 5.56 5.81 6.19
70 74 5.88 6.23 6.83
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.58 $4.79 $4.89 $5.03
55 59 4.80 5.06 5.17 5.35
57 61 4.89 5.18 5.30 5.49
60 64 5.04 5.36 5.50 5.72
62 66 5.14 5.48 5.64 5.88
65 69 5.30 5.68 5.85 6.13
70 74 5.58 6.03 6.23 6.57
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.13 $5.29 $5.56
55 59 5.47 5.67 6.00
57 61 5.63 5.84 6.20
60 64 5.87 6.12 6.54
62 66 6.05 6.32 6.79
65 69 6.32 6.64 7.19
70 74 6.82 7.21 7.95
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.79 $5.05 $5.17 $5.37
55 59 5.05 5.34 5.47 5.69
57 61 5.17 5.47 5.61 5.84
60 64 5.36 5.69 5.84 6.09
62 66 5.50 5.85 6.01 6.28
65 69 5.73 6.11 6.28 6.58
70 74 6.16 6.60 6.81 7.15
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.51 $5.74 $6.17
55 59 5.85 6.12 6.61
57 61 6.01 6.29 6.81
60 64 6.28 6.58 7.15
62 66 6.47 6.79 7.41
65 69 6.79 7.15 7.83
70 74 7.41 7.83 8.66
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
15
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VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity
With Additional Purchase Payment Option
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or
Fixed Basis
Non-Participating
16
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If you have any questions concerning this Contract or if anyone suggests that
you change or replace this Contract, please contact your First Investors Life
agent or the Home Office of the Company.
FIL
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street / New York, N.Y. 10005
17
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VARIABLE
ANNUITY
CONTRACT
CONTRACT
Single Payment Deferred Variable Annuity NUMBER
With Additional Purchase Payment Option
Accumulation of Values on a Variable Basis
Annuitant
Annuity Payment Options on Variable or
Fixed Basis Date of Issue
Non-Participating Issue Age
FIL Purchase Payment
FIRST INVESTORS
LIFE INSURANCE COMPANY Maturity Date
First Investors Life agrees to pay the benefits and other rights described in
this contract in accord with the terms of this contract.
Signed for First Investors Life Insurance Company at its Home Office in New
York, New York.
/s/Richard H. Gaebler
Richard H. Gaebler, President
/s/Carol L. Brown
Carol L. Brown, Secretary
10-DAY RIGHT TO EXAMINE CONTRACT
During a period of 10 days from the date this Contract is delivered to the
Owner, it may be surrendered to the Company or to the agent through whom it
was purchased together with a written request for cancellation of the
Contract. If this Contract is replacing another annuity contract, the Owner
may surrender it within 20 days of its delivery. The purchase payment will
then be refunded and the Owner and the Company shall be in the same position
as if no contract had been issued.
<PAGE>
THE ANNUAL INVESTMENT RETURN REQUIRED TO MAINTAIN LEVEL VARIABLE ANNUITY
PAYMENTS IS 5.65% (AFTER ANY APPLICABLE TAXES, BUT BEFORE ASSET CHARGES TOTALING
1.4% FOR MORTALITY RISKS, EXPENSE RISKS AND CONTRACT MAINTENANCE CHARGES AND
MANAGEMENT FEES WHICH WILL NOT EXCEED .75% OF NET ASSETS OF MUTUAL FUND IN WHICH
SEPARATE ACCOUNT ASSETS ARE INVESTED). ANNUITY PAYMENTS AND OTHER VALUES
PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT EXPERIENCE OF A SEPARATE
ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO FIXED-DOLLAR AMOUNT.
2
<PAGE>
CONTRACT DATA CONTRACT NUMBER 310000
ANNUITANT JOHN A. DOE
DATE OF ISSUE MARCH 14, 1997
ISSUE AGE 35
PURCHASE PAYMENT $25,000.00
MATURITY DATE MARCH 14, 2052
SEPARATE ACCOUNT
FIRST INVESTORS LIFE SEPARATE ACCOUNT D
MUTUAL FUND
FIRST INVESTORS LIFE SERIES FUND
PURCHASE PAYMENT WILL BE ALLOCATED
AS FOLLOWS:
25% to High Yield Series
25% to Discovery Series
25% to Growth Series
25% to Blue chip Series
UNIT EFFECTIVE DATE
MARCH 1, 1997
OWNER
ANNUITANT
BENEFICIARY DESIGNATION
REFER TO ENCLOSED APPLICATION
CONTINGENT DEFERRED SALES CHARGE UPON SURRENDER
REFER TO PAGE 9
3
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ALPHABETICAL GUIDE
PAGE
ACCUMULATION OF UNITS..........................................................5
ACCUMULATION UNIT VALUE........................................................6
ADDITIONAL PURCHASE PAYMENT....................................................5
ADJUSTMENT OF MONTHLY PAYMENT..................................................7
ALLOCATION OF ANNUITY..........................................................7
AMOUNT OF FIRST ANNUITY PAYMENT................................................6
ANNUITY TABLES................................................................10
ANNUITY UNIT VALUE.............................................................6
ASSIGNMENT.....................................................................4
BENEFICIARY CHANGE.............................................................9
BENEFICIARY DESIGNATION........................................................9
CHANGE OF CONTRACT.............................................................5
CHARGES AGAINST THE SEPARATE ACCOUNT...........................................6
CHOICE OF ANNUITY OPTION.......................................................6
CLAIMS OF CREDITORS............................................................5
CONTINGENT DEFERRED SALES CHARGE...............................................9
CONTRACT.......................................................................4
CONTRACT MAINTENANCE CHARGE....................................................6
CONTROL........................................................................4
DEATH OF ANNUITANT.............................................................8
DEATH OF BENEFICIARY...........................................................9
DEATH OF OWNER.................................................................8
DEFINITIONS....................................................................4
ELECTION OF ANNUITY OPTIONS....................................................7
FIXED ANNUITY..................................................................7
INCONTESTABILITY...............................................................4
INITIAL PURCHASE PAYMENT.......................................................5
INVESTMENT OF THE SEPARATE ACCOUNT.............................................5
MATURITY DATE..................................................................6
MISSTATEMENT OF AGE OR SEX.....................................................4
MORE FAVORABLE PAYMENT OPTION..................................................7
NET INVESTMENT FACTOR..........................................................6
NONPARTICIPATING...............................................................5
OWNERSHIP OF THE ASSETS........................................................4
PROOF OF AGE...................................................................5
PROOF OF SURVIVAL..............................................................5
REPORTS........................................................................5
SEPARATE ACCOUNT - GENERAL.....................................................5
SETTLEMENT.....................................................................5
SURRENDER OPTION...............................................................9
VALUATION OF ASSETS............................................................6
VARIABLE ANNUITY...............................................................7
VOTING RIGHTS..................................................................4
WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE.........................................9
POLICY PROVISIONS
GENERAL PROVISIONS.............................................................4
PURCHASE PAYMENTS..............................................................5
SEPARATE ACCOUNT...............................................................5
BENEFITS.......................................................................6
BENEFICIARY....................................................................9
4
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GENERAL PROVISIONS
1. DEFINITIONS
As used in this Contract, the term:
(a) "Separate Account" means the account shown as such on page 3.
(b) "Valuation Date" means any date on which the New York Stock Exchange is
open for trading;
(c) "Valuation Period" means the period starting on the day after any Valuation
Date and ending on the next such Date;
(d) "Accumulation Unit" means a unit used to measure the value of an Owner's
interest in the Separate Account prior to the date on which annuity payments
commence;
(e) "Annuity Unit" means a unit used to determine the amount of each annuity
payment after the first;
(f) "Accumulated Value" means the value of all the Accumulation Units credited
to this Contract.
(g) "Purchase Payment" means an amount paid to the Company under this Contract
as a payment for the benefits described herein;
(h) "Variable Annuity" means an annuity with annuity payments varying in amount
in accordance with the net investment experience of the Separate Account;
(i) "Fixed-Dollar Annuity" means an annuity with annuity payments which stay
fixed as to dollar amount throughout the payment period;
(j) "Attained Age" of the annuitant on any date after the Date of Issue means
the age of the Annuitant at issue as shown on page 3 plus the number of years
elapsed from the Date of Issue to such date; and
(k) "Annuity Commencement Date" means the date on which annuity payments are to
commence. Also referred to as "Maturity Date" in this contract.
2. CONTRACT
This Contract, the application, and any riders attached to this Contract
constitute the whole contract. Only the President, a Vice President, the
Secretary, or an Assistant Secretary of the Company has the power, on behalf of
the Company, to change, modify or waive any provisions of this Contract. Any
changes, modifications, or waivers must be in writing. The Company will not be
bound by any promises or representations made by any agent or other person
except as specified above.
3. CONTROL
Consistent with the terms of any beneficiary designation and any assignment, the
Owner may, during the lifetime of the Annuitant:
1. assign this Contract or surrender it in whole or in part;
2. amend or change this Contract with the consent of the Company; and
3. exercise any right, receive any benefit, or enjoy any privilege in this
Contract.
The Company reserves the right to require this Contract for endorsement of any
assignment or change.
4. INCONTESTABILITY
This Contract will not be contested.
5. MISSTATEMENT OF AGE OR SEX
If the age or the sex of the Annuitant has been misstated, the benefits in this
Contract will be those which the Single Purchase Payment would have bought for
the right age and sex. Any amounts which should have been in the payments made
by the Company before the error was found will be made up right away. The
Company will pay interest at the rate of 6% per year on this additional amount.
Any excess amounts in the payments made by the Company before the error was
found will be charged against the payments which are due later.
5
<PAGE>
6. ASSIGNMENT
No assignment of this Contract shall be binding on the Company unless it is in
writing and filed with the Company at its Home Office. The Company will assume
no responsibility of the validity or sufficiency of any assignment. Unless
otherwise provided in the assignment, the interest of any revocable beneficiary
shall be subordinate to the interest of any assignee, regardless of when the
assignment was made and the assignee shall receive any sum payable to the extent
of his interest.
7. OWNERSHIP OF THE ASSETS
The Company shall have exclusive and absolute ownership and control of its
assets, including all assets in the Separate Account.
8. VOTING RIGHTS
The Owner shall have the right to vote only at the meetings of the Fund.
Ownership of this Contract shall not entitle any person to vote at any meeting
of shareholders of the Company. Votes attributable to the Contract shall be
cast in conformity with applicable law.
9. REPORTS
At least once each Contract Year the Company shall mail a report to the Owner.
The report shall be mailed to the last address known to the Company. The report
shall include a statement of the number of units credited to this Contract and
the dollar value of such units. The information in the report shall be as of a
date not more than two months prior to the date of mailing the report. The
Company shall also mail to the Owner at least once in each Contract Year, a
report of the investments held in the Separate Account under this Contract.
10. PROOF OF AGE
Any annuity payment will be subject to proof of age of the payee which the
company will accept.
11. PROOF OF SURVIVAL
The Company has the right to ask for proof that the person on whom the payment
is based is alive when each payment is due.
12. SETTLEMENT
Any payment by the Company under this Contract is payable at its Home Office.
13. CLAIMS OF CREDITORS
To the extent allowed by law, Proceeds will not be subject to any claims of
creditors.
14. CHANGE OF CONTRACT
The Company keeps the right to change this Contract to meet the requirements of
the Investment Company Act of 1940 or other applicable federal or state laws or
regulations.
15. NONPARTICIPATING
This Contract is nonparticipating. It will not share in the surplus earnings of
the Company.
PURCHASE PAYMENTS
16. INITIAL PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue. The minimum Single
Purchase Payment which may be made is $25,000.
The Company will use the Initial Purchase Payment on the day it is received at
the Home Office to provide accumulation units, the number of which will be based
on that day's value of such units.
6
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17. ADDITIONAL PURCHASE PAYMENT OPTION
Additional Purchase Payments may be made at the option of the Owner at any time
up to the Maturity Date.
The Company will use the Additional Purchase Payment on the day it is received
at the Home Office to provide accumulation units, the number of which will be
based on that day's value of such units.
SEPARATE ACCOUNT
18. GENERAL
The Separate Account is a segregated investment account maintained by the
Company. A part of the assets of the Separate Account have been allocated for
this and certain other Contracts. The assets of the Separate Account are held
apart from the assets of the Company. Charges against these assets do not arise
out of any other business of the Company.
19. INVESTMENTS OF THE SEPARATE ACCOUNT
The assets of the Separate Account will be invested in shares of the mutual fund
shown on page 3 ("Fund"). The Fund is registered under the Investment Company
Act of 1940, as amended (the "Act").
The assets of each subaccount will be invested, as requested in the application
or as later requested in writing, in shares of the corresponding series of the
Fund shown on page 3. The assets may be allocated among at least one but not
more than five subaccounts. The Owner can change the allocation among the
subaccounts by furnishing notice to the Home Office. The change will take
effect when the Company receives this notice.
The Company may, in its discretion, invest the assets in shares of any other
fund or investment allowed by law.
All distributions from the Fund will be reinvested and kept as assets. When
needed to pay for surrenders, shares of the Fund held by the Separate Account
will be redeemed at net asset value.
20. ACCUMULATION UNITS
This Contract will be credited with the number of Accumulation Units of each
subaccount of the Separate Account bought by the amount of the Purchase Payment
allocated to each subaccount of the Separate Account.
This Contract will also be credited with the number of Accumulation Units of
each subaccount of the Separate Account bought by the amount of any Additional
Purchase Payment allocated to each subaccount of the Separate Account.
21a. CHARGES AGAINST THE SEPARATE ACCOUNT
The Company deducts an amount equal on a yearly basis to 1.4% of the daily net
asset value of each subaccount comprised of 1.25% to pay it for taking on
mortality and expense risks and .15% for taking on expenses related to
administration of the Contract.
21b. CONTRACT MAINTENANCE CHARGE
On the last business day of each Contract Year or on the date of surrender of
this Contract, if earlier, the Company will deduct a $30.00 Contract
Maintenance Charge from the Accumulated Value but in no case will this charge
exceed 2% of such value. It will be charged against the Accumulated Value by
proportionately reducing the number of Accumulation Units held on that date with
respect to each active subaccount of the Separate Account.
22. NET INVESTMENT FACTOR
The net investment factor for a subaccount of the Separate Account for any
Valuation Period is obtained by dividing (a) by (b) and subtracting (c) from the
result, where:
7
<PAGE>
(a) is the result of:
(1) the net asset value per share of the series of the Fund at the
end of the current Valuation Period, plus:
(2) the per share amount of any dividend or capital gains
distributions made by the series of the Fund during the current Valuation
Period, plus or minus:
(3) a per share charge or credit for any taxes reserved for.
(b) is the result of:
(1) the net asset value per share of the series of the Fund as of the
end of the preceding Valuation Period, plus or minus:
(2) the per share charge or credit for any taxes reserved for the
preceding Valuation Period.
(c) is a factor for the charges shown in Section 21a.
23. VALUATION OF ASSETS
Fund shares held in the Separate Account will be valued at their net asset
value. Other assets will be valued at fair market value.
24. ACCUMULATION UNIT VALUE
The value of an Accumulation Unit was set at $10.00 on the Unit Effective Date.
The value for a later period is obtained by multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end. The unit value may rise or fall based on investment results.
25. ANNUITY UNIT VALUE
The value of an Annuity Unit was set at $10.00 on the Unit Effective Date. The
value for a later period is obtained by first multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end and then multiplying the result by a factor which offsets the effect
of the assumed interest rate of 3.5% per year built into the table used in the
Contract.
BENEFITS
26. MATURITY DATE
Annuity payments will start on the Maturity Date shown on page 3. On written
request, it may be changed. But it will not be deferred beyond the Contract
Anniversary on which the attained age of the Annuitant is 90.
27. CHOICE OF ANNUITY OPTION
A choice of Annuity Option should be made by the Owner at least 30 days before
the Maturity Date.
If a choice is not made on time, payments will start on the Maturity Date on a
Variable Annuity basis with the Annuity Option as 10 years certain or life.
Once payments start, no further choice is allowed.
28. AMOUNT OF FIRST ANNUITY PAYMENT
Seven (7) days before the Maturity Date, any premium taxes not yet deducted will
be deducted from the Accumulated Value to determine the Net Accumulated Value.
Such value will then be applied to the proper Annuity Table on page 10 or 11 to
determine the amount of the first monthly annuity payment.
The amount of each payment depends on the sex and adjusted age of the Annuitant
and Joint Annuitant, if any, at the Maturity Date. The adjusted age is
determined at the time the first payment is due. For a payee born prior to
1900, the adjusted age is the actual age. For a payee born 1900 or
8
<PAGE>
later, the adjusted age is the actual age minus four years and also minus one
year for each completed five years during the period from 1900 to the payee's
year of birth.
The Company may, at its option, credit interest above the 3.5% per year rate
built into the tables used in this Contract.
29. ALLOCATION OF ANNUITY
When the Owner makes a choice as to annuity option, he or she will also choose
between a Fixed Annuity, a Variable Annuity or any combination of the two. If a
choice is not made at least 30 days before the Maturity Date, as stated in
Section 27, payments will be made on a Variable Annuity basis.
30. VARIABLE ANNUITY
A Variable Annuity is one with payments which vary as to dollar amount through
the annuity period based on the investment results of the Separate Account. The
method by which the amount of the first monthly payment is determined is shown
in Section 28.
Each payment for any due date after the first will be determined by multiplying
the Annuity Unit Value on the date seven days prior to the date on which the
payment is due by a constant number of Annuity Units. The payment may be less
than or greater than the preceding payment.
The constant number of Units is determined by dividing the dollar amount of the
first payment by the then current value of an Annuity Unit on the date the first
payment is due.
The Company guarantees that the dollar amount of each payment after the first
will not be affected by variations in mortality or expense experience from the
mortality and expense assumptions on which the first payment is based.
31. FIXED ANNUITY
A Fixed Annuity is one with payments which stay fixed as to dollar amount
through the annuity period. The method by which the amount of the first monthly
payment is determined is shown in Section 28. Later payments will not be less
than the first but a later payment may be more than the first if the Company
credits interest above the rate built into the tables.
32. ADJUSTMENT OF MONTHLY PAYMENT
If the Net Accumulated Value on the Maturity Date is less than $2,000, the
Company shall have the right to pay such value in one sum in lieu of payments
otherwise provided for. If the Net Accumulated Value is not less than $2,000
but either the Variable Annuity or the Fixed Annuity Payments provided for would
be or become less than $20, the Company shall have the right to change the
frequency of payment to such intervals as will result in payments of at least
$20.
33. MORE FAVORABLE PAYMENT OPTION
At the time fixed annuity payments begin, the single premium fixed annuity rates
then in use by the Company will be used if they provide a payment amount to the
payee greater than that shown in the table on page 10 or 11. Each $1,000 of
cash value shall be considered to be $1,030 for the purpose of using the single
premium annuity rates.
34. ELECTION OF ANNUITY OPTIONS
The owner may elect to have annuity payments made under any one of the Annuity
Options described below or in any other manner agreeable to the Company. Any
such election shall be made in writing to the Company at its Home Office at
least 30 days before the Maturity Date. The election may be changed in the same
manner at any time prior to the surrender of this Contract. If the amount of
payments for different guaranteed periods are the same at any given age, the
Company will deem the longer period certain to have been chosen.
OPTION 1 - LIFE ANNUITY - An annuity payable monthly during the lifetime of the
Annuitant, ceasing with the last payment due prior to his or her death.
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - an annuity payable monthly during
the joint lifetime of the
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Annuitant and the Joint Annuitant and continuing, after the death of either,
during the lifetime of the survivor, ceasing with the last payment due prior to
the death of the survivor.
OPTION 2B - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
two-thirds payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 2C - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
one-half payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 3 - LIFE ANNUITY WITH 60, 120 OR 240 MONTHLY PAYMENTS GUARANTEED - An
annuity payable monthly during the lifetime of the Annuitant, with the guarantee
that if, at his or her death, payments have been made for less than 60, 120 or
240 monthly period, as elected, any guaranteed annuity payments will be
continued during the remainder of the selected period to the Beneficiary.
OPTION 4 - UNIT REFUND LIFE ANNUITY - An annuity payable monthly during the
lifetime of the Annuitant, with the last payment due prior to his or her death,
provided further that, at such death, the Beneficiary will receive an additional
payment of the then dollar value of the number of Annuity Units equal to the
excess, if any, of (a) over (b) where (a) is the total amount applied under the
option divided by the Annuity Unit Value at the Maturity Date and (b) is the
product of the number of Annuity Units represented by each payment and the
number of payments made.
When this option is applied as a Fixed Annuity (a) shall be the Accumulated
Value applied at the Maturity Date to the Fixed Annuity, (b) shall be the sum of
all Fixed Annuity Payments made.
35. DEATH OF ANNUITANT
On receipt of due proof of the death of the Annuitant before Annuity Payments
have begun, the Company will pay the Death Benefit to the Beneficiary as of the
day on which such due proof is received by the Company. The Death Benefit will
be the greatest of the following amounts:
(a) The Accumulated Value on the date of receipt of Due Proof of Death at
the Home Office of the Company;
(b) The Accumulated Value on the Specified Contract Anniversary
immediately preceding the date of death, increased by the dollar
amount of any purchase payments made and reduced by the dollar amount
of any partial withdrawals since the immediately preceding Specified
Contract Anniversary;
or
(c) 100% of all purchase payments made under the Contract, reduced by the
dollar amount of any partial withdrawals since the Date of Issue.
The Specified Contract Anniversary is every seventh contract anniversary (i.e.
7th, 14th, 21st, etc.)
If the Annuitant and the Owner are one in the same at the time of the
Annuitant's death and the proceeds are payable to (or for the benefit of) the
Annuitant's surviving spouse, such spouse shall have the right to become the
Annuitant under the contract. If the Annuitant dies at a time when the Owner of
the contract is not an individual, the Annuitant will be considered to be the
Owner for the purpose of this section.
On receipt of due proof of death of the Annuitant after Annuity Payments have
begun under an Annuity Option, if any payments remain under the Option they will
be paid to the Beneficiary as provided by the Option.
Unless otherwise provided in the Beneficiary designation, if no Beneficiary
survives the Annuitant, the proceeds will be paid in one sum to the Owner, if
living; otherwise, to the Owner's estate.
36. DEATH OF OWNER
The purpose of this Section is to qualify this Contract as an annuity contract
in accordance with Section 72(s) of the Internal Revenue Code of 1986, as
amended ("Code"). Its provisions shall apply notwithstanding any other
provisions of the Contract in conflict therewith.
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In the event any Owner of this Contract who is not the Annuitant dies on or
after the Maturity Date and before the entire interest in the Contract has been
distributed, the remaining portion of such interest will be distributed at least
as rapidly as under the Annuity Option in effect as of the Date of the Owner's
death.
In the event any Owner of this Contract who is not the Annuitant dies prior to
the Maturity Date, the entire interest of that Owner in this Contract shall be
distributed to the Beneficiary within five years after the Owner's death, or
distributed under an Annuity Option providing for annuity payments over the life
of such Beneficiary or over a period not extending beyond the life expectancy of
such Beneficiary (in accordance with the regulations the Secretary of the
Treasury may prescribe), if such payments begin within one year after the date
of the Owner's death or such later date as the Secretary of the Treasury may
prescribe by regulations. In addition, if any portion of the Owner's interest
in this Contract is payable to (or for the benefit of) the Owner's surviving
spouse, that spouse shall be deemed to have been designated by the Owner as a
"designated beneficiary" for purpose of Section 72(s) of the Code, and shall be
treated as the Owner, and no distributions described hereinabove shall be
required, with respect to that portion of the Contract payable to (or for the
benefit of) such spouse. If the Owner who dies is the one named in the original
application for this Contract, the entire interest of that Owner in this
Contract will be the same as if the Owner had been the Annuitant; if the Owner
who dies is not the one named in the original application for this Contract, the
entire interest of that Owner shall be the Accumulated Value of this Contract.
37. SURRENDER OPTION
The Owner may turn this Contract in for its Surrender Value effective on the
date on which the request in writing is received at the Home Office. The value
will be the Accumulated Value on that date less (a) a Contingent Deferred Sales
Charge, if any, (b) the Contract Maintenance Charge and (c) any applicable
premium taxes not previously deducted.
Any cash payment will be mailed within 7 days after receipt of a proper request;
but the Company may be allowed to defer the payment under the Investment Company
Act of 1940 as it is in effect at that time. The Surrender Option is not
available after the Maturity Date.
38. WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE
The Owner may withdraw a part of the Surrender Value of this Contract effective
on the date on which the request in writing is received at the Home Office at
any time prior to the Maturity Date provided the Surrender Value remaining after
the surrender is at least equal to the Company's minimum amount rules then in
effect. If the remaining Surrender Value following such surrender is less than
the Company's minimum amount rules, the Company will terminate the contract and
pay the Surrender Value.
If applicable, a Contingent Deferred Sales Charge will be assessed against any
Accumulated Value surrendered. However, on a noncumulative basis, the Owner may
make partial surrenders during any Contract Year prior to the Maturity Date, up
to the Annual Withdrawal Privilege Amount of 10% of Purchase Payments and the
Contingent Deferred Sales Charge will not be assessed against such amounts.
Any Withdrawal Privilege Amount surrenders will be deemed to be from Accumulated
Values other than purchase payments. Surrender of Accumulated Values in excess
of the Withdrawal Privilege Amount and additional surrenders made in any
Contract Year will be subject to the Contingent Deferred Sales Charge, if
applicable.
39. CONTINGENT DEFERRED SALES CHARGE
A Contingent Deferred Sales Charge may be assessed against the Accumulated Value
when surrendered. The length of time from receipt of the purchase payment to
the time of surrender determines the charge. For this purpose, Purchase
Payments will be deemed to be surrendered in the order in which they were
received and all surrenders will be first from Purchase Payments and then from
other contract values. This charge is a percentage of the amount withdrawn (not
to exceed the aggregate amount of the Purchase Payments made) and equals:
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Length of time from
Contingent Deferred Purchase Payment
Sales Charge (Number of years)
------------ -----------------
7% Less than 1
6% 1 - 2
5% 2 - 3
4% 3 - 4
3% 4 - 5
2% 5 - 6
1% 6 - 7
None More than 7
No Contingent Deferred Sales Charges will be assessed in the event of the death
of the Annuitant or the Owner (as applicable), or if contract values are applied
to an annuity option provided for under this contract or upon the exercise of
the Withdrawal Privilege.
BENEFICIARY
40. BENEFICIARY DESIGNATION
The Beneficiary will be as named in the application for this Contract unless the
designation has been changed by the Owner.
41. BENEFICIARY CHANGE
The Owner may change the designation while the Annuitant is alive unless
otherwise provided in the previous designation.
A change may be made by filing a written request with the Home Office. The
request must be in a form acceptable to the Company. The Company may require
this Contract for endorsement of a change.
42. DEATH OF BENEFICIARY
Unless otherwise provided, if any Beneficiary dies before the Annuitant, his or
her interest will pass to any other Beneficiaries according to their respective
interests.
If the Beneficiary dies while receiving any remaining Annuity Payments due after
the death of the Annuitant, the value of the remainder of such Annuity Payments
will be paid in one sum to the Beneficiary's estate.
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ANNUITY TABLES
DOLLAR AMOUNT OF THE MONTHLY ANNUITY PAYMENT WHICH
IS PURCHASED WITH EACH $1,000 OF PROCEEDS APPLIED
OPTION 1,3 AND 4 - SINGLE LIFE ANNUITIES
Monthly Payments Guaranteed
Unit
Refund
Adjusted Age None 60 120 240
Male Female Option 1 Option 3 Option 3 Option 3 Option 4
50 54 $4.74 $4.73 $4.69 $4.52 $4.53
51 55 4.84 4.82 4.78 4.58 4.60
52 56 4.94 4.92 4.87 4.65 4.67
53 57 5.04 5.03 4.97 4.71 4.75
54 58 5.16 5.14 5.07 4.78 4.84
55 59 5.28 5.25 5.18 4.85 4.93
56 60 5.40 5.38 5.29 4.91 5.02
57 61 5.54 5.51 5.41 4.98 5.12
58 62 5.69 5.65 5.53 5.05 5.22
59 63 5.84 5.80 5.66 5.11 5.32
60 64 6.01 5.95 5.79 5.18 5.44
61 65 6.18 6.12 5.94 5.24 5.56
62 66 6.37 6.30 6.08 5.30 5.68
63 67 6.57 6.49 6.24 5.36 5.82
64 68 6.79 6.69 6.40 5.41 5.96
65 69 7.02 6.91 6.57 5.46 6.10
66 70 7.27 7.14 6.74 5.51 6.26
67 71 7.54 7.38 6.91 5.55 6.43
68 72 7.83 7.64 7.10 5.59 6.60
69 73 8.14 7.91 7.28 5.62 6.78
70 74 8.48 8.20 7.47 5.65 6.98
71 75 8.84 8.51 7.66 5.68 7.19
72 76 9.23 8.84 7.85 5.70 7.41
73 77 9.65 9.18 8.04 5.71 7.65
74 78 10.11 9.55 8.23 5.72 7.89
75 79 10.61 9.93 8.41 5.73 8.16
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint .............. Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.21 $4.35 $4.40 $4.47
55 59 4.37 4.58 4.66 4.78
57 61 4.43 4.67 4.77 4.90
60 64 4.51 4.80 4.92 5.00
62 66 4.55 4.88 5.01 5.22
65 69 4.62 4.99 5.15 5.39
70 74 4.70 5.14 5.34 5.65
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - Cont'd
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $4.51 $4.57 $4.64
55 59 4.85 4.94 5.07
57 61 4.99 5.10 5.26
60 64 5.20 5.36 5.59
62 66 5.35 5.54 5.82
65 69 5.56 5.81 6.19
70 74 5.88 6.23 6.83
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.58 $4.79 $4.89 $5.03
55 59 4.80 5.06 5.17 5.35
57 61 4.89 5.18 5.30 5.49
60 64 5.04 5.36 5.50 5.72
62 66 5.14 5.48 5.64 5.88
65 69 5.30 5.68 5.85 6.13
70 74 5.58 6.03 6.23 6.57
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.13 $5.29 $5.56
55 59 5.47 5.67 6.00
57 61 5.63 5.84 6.20
60 64 5.87 6.12 6.54
62 66 6.05 6.32 6.79
65 69 6.32 6.64 7.19
70 74 6.82 7.21 7.95
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.79 $5.05 $5.17 $5.37
55 59 5.05 5.34 5.47 5.69
57 61 5.17 5.47 5.61 5.84
60 64 5.36 5.69 5.84 6.09
62 66 5.50 5.85 6.01 6.28
65 69 5.73 6.11 6.28 6.58
70 74 6.16 6.60 6.81 7.15
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.51 $5.74 $6.17
55 59 5.85 6.12 6.61
57 61 6.01 6.29 6.81
60 64 6.28 6.58 7.15
62 66 6.47 6.79 7.41
65 69 6.79 7.15 7.83
70 74 7.41 7.83 8.66
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
15
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VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity
With Additional Purchase Payment Option
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or
Fixed Basis
Non-Participating
16
<PAGE>
If you have any questions concerning this Contract or if anyone suggests that
you change or replace this Contract, please contact your First Investors Life
agent or the Home Office of the Company.
FIL
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street / New York, N.Y. 10005
17
<PAGE>
If you have any questions concerning this Contract or if anyone suggests that
you change or replace this Contract, please contact your First Investors Life
agent or the Home Office of the Company.
FIL
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street / New York, N.Y. 10005
18
<PAGE>
VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity CONTRACT
With Additional Purchase Payment Option NUMBER
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or Annuitant
Fixed Basis
Date of Issue
Non-Participating
Issue Age
FIL
FIRST INVESTORS Purchase Payment
LIFE INSURANCE COMPANY
Maturity Date
First Investors Life agrees to pay the benefits and other rights described in
this contract in accord with the terms of this contract.
Signed for First Investors Life Insurance Company at its Home Office in New
York, New York.
/s/Richard H. Gaebler
Richard H. Gaebler, President
/s/Carol L. Brown
Carol L. Brown, Secretary
10-DAY RIGHT TO EXAMINE CONTRACT
During a period of 10 days from the date this Contract is delivered to the
owner, it may be surrendered to the Company or to the agent through whom it
was purchased together with a written request for cancellation of the
Contract. The purchase payment will then be refunded, whereupon the Contract
shall be void from the beginning and the Owner and the Company shall be in
the same position as if no contract had been issued. A 10% penalty shall be
added to any refund due which is not paid within 30 days of return of the
policy.
1
<PAGE>
THE ANNUAL INVESTMENT RETURN REQUIRED TO MAINTAIN LEVEL VARIABLE ANNUITY
PAYMENTS IS 5.65% (AFTER ANY APPLICABLE TAXES, BUT BEFORE ASSET CHARGES
TOTALING 1.4% FOR MORTALITY RISKS, EXPENSE RISKS AND CONTRACT MAINTENANCE
CHARGES AND MANAGEMENT FEES WHICH WILL NOT EXCEED .75% OF NET ASSETS OF
MUTUAL FUND IN WHICH SEPARATE ACCOUNT ASSETS ARE INVESTED). ANNUITY PAYMENTS
AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT
EXPERIENCE OF A SEPARATE ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO
FIXED-DOLLAR AMOUNT.
2
<PAGE>
CONTRACT DATA CONTRACT NUMBER 310000
ANNUITANT JOHN A. DOE
DATE OF ISSUE MARCH 14, 1997
ISSUE AGE 35
PURCHASE PAYMENT $25,000.00
MATURITY DATE MARCH 14, 2052
SEPARATE ACCOUNT
FIRST INVESTORS LIFE SEPARATE ACCOUNT D
MUTUAL FUND
FIRST INVESTORS LIFE SERIES FUND
PURCHASE PAYMENT WILL BE ALLOCATED
AS FOLLOWS:
25% to High Yield Series
25% to Discovery Series
25% to Growth Series
25% to Blue chip Series
UNIT EFFECTIVE DATE
MARCH 1, 1997
OWNER
ANNUITANT
BENEFICIARY DESIGNATION
REFER TO ENCLOSED APPLICATION
CONTINGENT DEFERRED SALES CHARGE UPON SURRENDER
REFER TO PAGE 9
3
<PAGE>
ALPHABETICAL GUIDE
PAGE
ACCUMULATION OF UNITS. . . . . . . . . . . . . . . . . . . . . . . . . . 5
ACCUMULATION UNIT VALUE. . . . . . . . . . . . . . . . . . . . . . . . . 6
ADDITIONAL PURCHASE PAYMENT. . . . . . . . . . . . . . . . . . . . . . . 5
ADJUSTMENT OF MONTHLY PAYMENT. . . . . . . . . . . . . . . . . . . . . . 7
ALLOCATION OF ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . 7
AMOUNT OF FIRST ANNUITY PAYMENT. . . . . . . . . . . . . . . . . . . . . 6
ANNUITY TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
ANNUITY UNIT VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
BENEFICIARY CHANGE . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
BENEFICIARY DESIGNATION. . . . . . . . . . . . . . . . . . . . . . . . . 9
CHANGE OF CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CHARGES AGAINST THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . 6
CHOICE OF ANNUITY OPTION . . . . . . . . . . . . . . . . . . . . . . . . 6
CLAIMS OF CREDITORS. . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CONTINGENT DEFERRED SALES CHARGE . . . . . . . . . . . . . . . . . . . . 9
CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
CONTRACT MAINTENANCE CHARGE. . . . . . . . . . . . . . . . . . . . . . . 6
CONTROL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
DEATH OF ANNUITANT . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
DEATH OF BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . 9
DEATH OF OWNER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ELECTION OF ANNUITY OPTIONS. . . . . . . . . . . . . . . . . . . . . . . 7
FIXED ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
INCONTESTABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
INITIAL PURCHASE PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . 5
INVESTMENT OF THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . 5
MATURITY DATE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
MISSTATEMENT OF AGE OR SEX . . . . . . . . . . . . . . . . . . . . . . . 4
MORE FAVORABLE PAYMENT OPTION. . . . . . . . . . . . . . . . . . . . . . 7
NET INVESTMENT FACTOR. . . . . . . . . . . . . . . . . . . . . . . . . . 6
NONPARTICIPATING . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
OWNERSHIP OF THE ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . 4
PROOF OF AGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
PROOF OF SURVIVAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
REPORTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SEPARATE ACCOUNT - GENERAL . . . . . . . . . . . . . . . . . . . . . . . 5
SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SURRENDER OPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
VALUATION OF ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . 6
VARIABLE ANNUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
VOTING RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE . . . . . . . . . . . . . . . . . 9
POLICY PROVISIONS
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
PURCHASE PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
BENEFICIARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4
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GENERAL PROVISIONS
1. DEFINITIONS
As used in this Contract, the term:
(a) "Separate Account" means the account shown as such on page 3.
(b) "Valuation Date" means any date on which the New York Stock Exchange is
open for trading;
(c) "Valuation Period" means the period starting on the day after any Valuation
Date and ending on the next such Date;
(d) "Accumulation Unit" means a unit used to measure the value of an Owner's
interest in the Separate Account prior to the date on which annuity payments
commence;
(e) "Annuity Unit" means a unit used to determine the amount of each annuity
payment after the first;
(f) "Accumulated Value" means the value of all the Accumulation Units credited
to this Contract.
(g) "Purchase Payment" means an amount paid to the Company under this Contract
as a payment for the benefits described herein;
(h) "Variable Annuity" means an annuity with annuity payments varying in amount
in accordance with the net investment experience of the Separate Account;
(I) "Fixed-Dollar Annuity" means an annuity with annuity payments which stay
fixed as to dollar amount throughout the payment period;
(j) "Attained Age" of the annuitant on any date after the Date of Issue means
the age of the Annuitant at issue as shown on page 3 plus the number of years
elapsed from the Date of Issue to such date; and
(k) "Annuity Commencement Date" means the date on which annuity payments are to
commence. Also referred to as "Maturity Date" in this contract.
2. CONTRACT
This Contract, the application, and any riders attached to this Contract
constitute the whole contract. Only the President, a Vice President, the
Secretary, or an Assistant Secretary of the Company has the power, on behalf of
the Company, to change, modify or waive any provisions of this Contract. Any
changes, modifications, or waivers must be in writing. The Company will not be
bound by any promises or representations made by any agent or other person
except as specified above.
3. CONTROL
Consistent with the terms of any beneficiary designation and any assignment, the
Owner may, during the lifetime of the Annuitant:
1. assign this Contract or surrender it in whole or in part;
2. amend or change this Contract with the consent of the Company; and
3. exercise any right, receive any benefit, or enjoy any privilege in this
Contract.
The Company reserves the right to require this Contract for endorsement of any
assignment or change.
4. INCONTESTABILITY
This Contract will not be contested.
5. MISSTATEMENT OF AGE OR SEX
If the age or the sex of the Annuitant has been misstated, the benefits in this
Contract will be those which the Single Purchase Payment would have bought for
the right age and sex. Any amounts which should have been in the payments made
by the Company before the error was found will be made up right away. The
Company will pay interest at the rate of 6% per year on this additional amount.
Any excess amounts in the payments made by the Company before the error was
found will be charged against the payments which are due later.
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6. ASSIGNMENT
No assignment of this Contract shall be binding on the Company unless it is in
writing and filed with the Company at its Home Office. The Company will assume
no responsibility of the validity or sufficiency of any assignment. Unless
otherwise provided in the assignment, the interest of any revocable beneficiary
shall be subordinate to the interest of any assignee, regardless of when the
assignment was made and the assignee shall receive any sum payable to the extent
of his interest.
7. OWNERSHIP OF THE ASSETS
The Company shall have exclusive and absolute ownership and control of its
assets, including all assets in the Separate Account.
8. VOTING RIGHTS
The Owner shall have the right to vote only at the meetings of the Fund.
Ownership of this Contract shall not entitle any person to vote at any meeting
of shareholders of the Company. Votes attributable to the Contract shall be
cast in conformity with applicable law.
9. REPORTS
At least once each Contract Year the Company shall mail a report to the Owner.
The report shall be mailed to the last address known to the Company. The report
shall include a statement of the number of units credited to this Contract and
the dollar value of such units. The information in the report shall be as of a
date not more than two months prior to the date of mailing the report. The
Company shall also mail to the Owner at least once in each Contract Year, a
report of the investments held in the Separate Account under this Contract.
10. PROOF OF AGE
Any annuity payment will be subject to proof of age of the payee which the
company will accept.
11. PROOF OF SURVIVAL
The Company has the right to ask for proof that the person on whom the payment
is based is alive when each payment is due.
12. SETTLEMENT
Any payment by the Company under this Contract is payable at its Home Office.
13. CLAIMS OF CREDITORS
To the extent allowed by law, Proceeds will not be subject to any claims of
creditors.
14. CHANGE OF CONTRACT
The Company keeps the right to change this Contract to meet the requirements of
the Investment Company Act of 1940 or other applicable federal or state laws or
regulations.
15. NONPARTICIPATING
This Contract is nonparticipating. It will not share in the surplus earnings of
the Company.
PURCHASE PAYMENTS
16. INITIAL PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue. The minimum Single
Purchase Payment which may be made is $25,000.
The Company will use the Initial Purchase Payment on the day it is received at
the Home Office to provide accumulation units, the number of which will be based
on that day's value of such units.
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17. ADDITIONAL PURCHASE PAYMENT OPTION
Additional Purchase Payments may be made at the option of the Owner at any time
up to the Maturity Date.
The Company will use the Additional Purchase Payment on the day it is received
at the Home Office to provide accumulation units, the number of which will be
based on that day's value of such units.
SEPARATE ACCOUNT
18. GENERAL
The Separate Account is a segregated investment account maintained by the
Company. A part of the assets of the Separate Account have been allocated for
this and certain other Contracts. The assets of the Separate Account are held
apart from the assets of the Company. Charges against these assets do not arise
out of any other business of the Company.
19. INVESTMENTS OF THE SEPARATE ACCOUNT
The assets of the Separate Account will be invested in shares of the mutual fund
shown on page 3 ("Fund"). The Fund is registered under the Investment Company
Act of 1940, as amended (the "Act").
The assets of each subaccount will be invested, as requested in the application
or as later requested in writing, in shares of the corresponding series of the
Fund shown on page 3. The assets may be allocated among at least one but not
more than five subaccounts. The Owner can change the allocation among the
subaccounts by furnishing notice to the Home Office. The change will take
effect when the Company receives this notice.
The Company may, in its discretion, invest the assets in shares of any other
fund or investment allowed by law.
All distributions from the Fund will be reinvested and kept as assets. When
needed to pay for surrenders, shares of the Fund held by the Separate Account
will be redeemed at net asset value.
20. ACCUMULATION UNITS
This Contract will be credited with the number of Accumulation Units of each
subaccount of the Separate Account bought by the amount of the Purchase Payment
allocated to each subaccount of the Separate Account.
This Contract will also be credited with the number of Accumulation Units of
each subaccount of the Separate Account bought by the amount of any Additional
Purchase Payment allocated to each subaccount of the Separate Account.
21a. CHARGES AGAINST THE SEPARATE ACCOUNT
The Company deducts an amount equal on a yearly basis to 1.4% of the daily net
asset value of each subaccount comprised of 1.25% to pay it for taking on
mortality and expense risks and .15% for taking on expenses related to
administration of the Contract.
21b. CONTRACT MAINTENANCE CHARGE
On the last business day of each Contract Year or on the date of surrender of
this Contract, if earlier, the Company will deduct a $30.00 Contract
Maintenance Charge from the Accumulated Value but in no case will this charge
exceed 2% of such value. It will be charged against the Accumulated Value by
proportionately reducing the number of Accumulation Units held on that date with
respect to each active subaccount of the Separate Account.
22. NET INVESTMENT FACTOR
The net investment factor for a subaccount of the Separate Account for any
Valuation Period is obtained by dividing (a) by (b) and subtracting (c) from the
result, where:
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(a) is the result of:
(1) the net asset value per share of the series of the Fund at the
end of the current Valuation Period, plus:
(2) the per share amount of any dividend or capital gains
distributions made by the series of the Fund during the current Valuation
Period, plus or minus:
(3) a per share charge or credit for any taxes reserved for.
(b) is the result of:
(1) the net asset value per share of the series of the Fund as of the
end of the preceding Valuation Period, plus or minus:
(2) the per share charge or credit for any taxes reserved for the
preceding Valuation Period.
(c) is a factor for the charges shown in Section 21a.
23. VALUATION OF ASSETS
Fund shares held in the Separate Account will be valued at their net asset
value. Other assets will be valued at fair market value.
24. ACCUMULATION UNIT VALUE
The value of an Accumulation Unit was set at $10.00 on the Unit Effective Date.
The value for a later period is obtained by multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end. The unit value may rise or fall based on investment results.
25. ANNUITY UNIT VALUE
The value of an Annuity Unit was set at $10.00 on the Unit Effective Date. The
value for a later period is obtained by first multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end and then multiplying the result by a factor which offsets the effect
of the assumed interest rate of 3.5% per year built into the table used in the
Contract.
BENEFITS
26. MATURITY DATE
Annuity payments will start on the Maturity Date shown on page 3. On written
request, it may be changed. But it will not be deferred beyond the Contract
Anniversary on which the attained age of the Annuitant is 90.
27. CHOICE OF ANNUITY OPTION
A choice of Annuity Option should be made by the Owner at least 30 days before
the Maturity Date.
If a choice is not made on time, payments will start on the Maturity Date on a
Variable Annuity basis with the Annuity Option as 10 years certain or life.
Once payments start, no further choice is allowed.
28. AMOUNT OF FIRST ANNUITY PAYMENT
Seven (7) days before the Maturity Date, any premium taxes not yet deducted will
be deducted from the Accumulated Value to determine the Net Accumulated Value.
Such value will then be applied to the proper Annuity Table on page 10 or 11 to
determine the amount of the first monthly annuity payment.
The amount of each payment depends on the sex and adjusted age of the Annuitant
and Joint Annuitant, if any, at the Maturity Date. The adjusted age is
determined at the time the first payment is due. For a payee born prior to
1900, the adjusted age is the actual age. For a payee born 1900 or
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later, the adjusted age is the actual age minus four years and also minus one
year for each completed five years during the period from 1900 to the payee's
year of birth.
The Company may, at its option, credit interest above the 3.5% per year rate
built into the tables used in this Contract.
29. ALLOCATION OF ANNUITY
When the Owner makes a choice as to annuity option, he or she will also choose
between a Fixed Annuity, a Variable Annuity or any combination of the two. If a
choice is not made at least 30 days before the Maturity Date, as stated in
Section 27, payments will be made on a Variable Annuity basis.
30. VARIABLE ANNUITY
A Variable Annuity is one with payments which vary as to dollar amount through
the annuity period based on the investment results of the Separate Account. The
method by which the amount of the first monthly payment is determined is shown
in Section 28.
Each payment for any due date after the first will be determined by multiplying
the Annuity Unit Value on the date seven days prior to the date on which the
payment is due by a constant number of Annuity Units. The payment may be less
than or greater than the preceding payment.
The constant number of Units is determined by dividing the dollar amount of the
first payment by the then current value of an Annuity Unit on the date the first
payment is due.
The Company guarantees that the dollar amount of each payment after the first
will not be affected by variations in mortality or expense experience from the
mortality and expense assumptions on which the first payment is based.
31. FIXED ANNUITY
A Fixed Annuity is one with payments which stay fixed as to dollar amount
through the annuity period. The method by which the amount of the first monthly
payment is determined is shown in Section 28. Later payments will not be less
than the first but a later payment may be more than the first if the Company
credits interest above the rate built into the tables.
32. ADJUSTMENT OF MONTHLY PAYMENT
If the Net Accumulated Value on the Maturity Date is less than $2,000, the
Company shall have the right to pay such value in one sum in lieu of payments
otherwise provided for. If the Net Accumulated Value is not less than $2,000
but either the Variable Annuity or the Fixed Annuity Payments provided for would
be or become less than $20, the Company shall have the right to change the
frequency of payment to such intervals as will result in payments of at least
$20.
33. MORE FAVORABLE PAYMENT OPTION
At the time fixed annuity payments begin, the single premium fixed annuity rates
then in use by the Company will be used if they provide a payment amount to the
payee greater than that shown in the table on page 10 or 11. Each $1,000 of
cash value shall be considered to be $1,030 for the purpose of using the single
premium annuity rates.
34. ELECTION OF ANNUITY OPTIONS
The owner may elect to have annuity payments made under any one of the Annuity
Options described below or in any other manner agreeable to the Company. Any
such election shall be made in writing to the Company at its Home Office at
least 30 days before the Maturity Date. The election may be changed in the same
manner at any time prior to the surrender of this Contract. If the amount of
payments for different guaranteed periods are the same at any given age, the
Company will deem the longer period certain to have been chosen.
OPTION 1 - LIFE ANNUITY - An annuity payable monthly during the lifetime of the
Annuitant, ceasing with the last payment due prior to his or her death.
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - an annuity payable monthly during
the joint lifetime of the
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Annuitant and the Joint Annuitant and continuing, after the death of either,
during the lifetime of the survivor, ceasing with the last payment due prior to
the death of the survivor.
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
two-thirds payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
one-half payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 3 - LIFE ANNUITY WITH 60, 120 OR 240 MONTHLY PAYMENTS GUARANTEED - An
annuity payable monthly during the lifetime of the Annuitant, with the guarantee
that if, at his or her death, payments have been made for less than 60, 120 or
240 monthly period, as elected, any guaranteed annuity payments will be
continued during the remainder of the selected period to the Beneficiary.
OPTION 4 - UNIT REFUND LIFE ANNUITY - An annuity payable monthly during the
lifetime of the Annuitant, with the last payment due prior to his or her death,
provided further that, at such death, the Beneficiary will receive an additional
payment of the then dollar value of the number of Annuity Units equal to the
excess, if any, of (a) over (b) where (a) is the total amount applied under the
option divided by the Annuity Unit Value at the Maturity Date and (b) is the
product of the number of Annuity Units represented by each payment and the
number of payments made.
When this option is applied as a Fixed Annuity (a) shall be the Accumulated
Value applied at the Maturity Date to the Fixed Annuity, (b) shall be the sum of
all Fixed Annuity Payments made.
35. DEATH OF ANNUITANT
On receipt of due proof of the death of the Annuitant before Annuity Payments
have begun, the Company will pay the Death Benefit to the Beneficiary as of the
day on which such due proof is received by the Company. The Death Benefit will
be the greatest of the following amounts:
(a) The Accumulated Value on the date of receipt of Due Proof of Death at
the Home Office of the Company;
(b) The Accumulated Value on the Specified Contract Anniversary
immediately preceding the date of death, increased by the dollar
amount of any purchase payments made and reduced by the dollar amount
of any partial withdrawals since the immediately preceding Specified
Contract Anniversary;
or
(c) 100% of all purchase payments made under the Contract, reduced by the
dollar amount of any partial withdrawals since the Date of Issue.
The Specified Contract Anniversary is every seventh contract anniversary (i.e.
7th, 14th, 21st, etc.)
If the Annuitant and the Owner are one in the same at the time of the
Annuitant's death and the proceeds are payable to (or for the benefit of) the
Annuitant's surviving spouse, such spouse shall have the right to become the
Annuitant under the contract. If the Annuitant dies at a time when the Owner of
the contract is not an individual, the Annuitant will be considered to be the
Owner for the purpose of this section.
On receipt of due proof of death of the Annuitant after Annuity Payments have
begun under an Annuity Option, if any payments remain under the Option they will
be paid to the Beneficiary as provided by the Option.
Unless otherwise provided in the Beneficiary designation, if no Beneficiary
survives the Annuitant, the proceeds will be paid in one sum to the Owner, if
living; otherwise, to the Owner's estate.
36. DEATH OF OWNER
The purpose of this Section is to qualify this Contract as an annuity contract
in accordance with Section 72(s) of the Internal Revenue Code of 1986, as
amended ("Code"). Its provisions shall apply notwithstanding any other
provisions of the Contract in conflict therewith.
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In the event any Owner of this Contract who is not the Annuitant dies on or
after the Maturity Date and before the entire interest in the Contract has been
distributed, the remaining portion of such interest will be distributed at least
as rapidly as under the Annuity Option in effect as of the Date of the Owner's
death.
In the event any Owner of this Contract who is not the Annuitant dies prior to
the Maturity Date, the entire interest of that Owner in this Contract shall be
distributed to the Beneficiary within five years after the Owner's death, or
distributed under an Annuity Option providing for annuity payments over the life
of such Beneficiary or over a period not extending beyond the life expectancy of
such Beneficiary (in accordance with the regulations the Secretary of the
Treasury may prescribe), if such payments begin within one year after the date
of the Owner's death or such later date as the Secretary of the Treasury may
prescribe by regulations. In addition, if any portion of the Owner's interest
in this Contract is payable to (or for the benefit of) the Owner's surviving
spouse, that spouse shall be deemed to have been designated by the Owner as a
"designated beneficiary" for purpose of Section 72(s) of the Code, and shall be
treated as the Owner, and no distributions described hereinabove shall be
required, with respect to that portion of the Contract payable to (or for the
benefit of) such spouse. If the Owner who dies is the one named in the original
application for this Contract, the entire interest of that Owner in this
Contract will be the same as if the Owner had been the Annuitant; if the Owner
who dies is not the one named in the original application for this Contract, the
entire interest of that Owner shall be the Accumulated Value of this Contract.
37. SURRENDER OPTION
The Owner may turn this Contract in for its Surrender Value effective on the
date on which the request in writing is received at the Home Office. The value
will be the Accumulated Value on that date less (a) a Contingent Deferred Sales
Charge, if any, (b) the Contract Maintenance Charge and (c) any applicable
premium taxes not previously deducted.
Any cash payment will be mailed within 7 days after receipt of a proper request;
but the Company may be allowed to defer the payment under the Investment Company
Act of 1940 as it is in effect at that time. The Surrender Option is not
available after the Maturity Date.
38. WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE
The Owner may withdraw a part of the Surrender Value of this Contract effective
on the date on which the request in writing is received at the Home Office at
any time prior to the Maturity Date provided the Surrender Value remaining after
the surrender is at least equal to the Company's minimum amount rules then in
effect. If the remaining Surrender Value following such surrender is less than
the Company's minimum amount rules, the Company will terminate the contract and
pay the Surrender Value.
If applicable, a Contingent Deferred Sales Charge will be assessed against any
Accumulated Value surrendered. However, on a noncumulative basis, the Owner may
make partial surrenders during any Contract Year prior to the Maturity Date, up
to the Annual Withdrawal Privilege Amount of 10% of Purchase Payments and the
Contingent Deferred Sales Charge will not be assessed against such amounts.
Any Withdrawal Privilege Amount surrenders will be deemed to be from Accumulated
Values other than purchase payments. Surrender of Accumulated Values in excess
of the Withdrawal Privilege Amount and additional surrenders made in any
Contract Year will be subject to the Contingent Deferred Sales Charge, if
applicable.
39. CONTINGENT DEFERRED SALES CHARGE
A Contingent Deferred Sales Charge may be assessed against the Accumulated Value
when surrendered. The length of time from receipt of the purchase payment to
the time of surrender determines the charge. For this purpose, Purchase
Payments will be deemed to be surrendered in the order in which they were
received and all surrenders will be first from Purchase Payments and then from
other contract values. This charge is a percentage of the amount withdrawn (not
to exceed the aggregate amount of the Purchase Payments made) and equals:
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Length of time from
Contingent Deferred Purchase Payment
Sales Charge (Number of Years)
------------ -----------------
7% Less than 1
6% 1 - 2
5% 2 - 3
4% 3 - 4
3% 4 - 5
2% 5 - 6
1% 6 - 7
None More than 7
No Contingent Deferred Sales Charges will be assessed in the event of the death
of the Annuitant or the Owner (as applicable), or if contract values are applied
to an annuity option provided for under this contract or upon the exercise of
the Withdrawal Privilege.
BENEFICIARY
40. BENEFICIARY DESIGNATION
The Beneficiary will be as named in the application for this Contract unless the
designation has been changed by the Owner.
41. BENEFICIARY CHANGE
The Owner may change the designation while the Annuitant is alive unless
otherwise provided in the previous designation.
A change may be made by filing a written request with the Home Office. The
request must be in a form acceptable to the Company. The Company may require
this Contract for endorsement of a change.
42. DEATH OF BENEFICIARY
Unless otherwise provided, if any Beneficiary dies before the Annuitant, his or
her interest will pass to any other Beneficiaries according to their respective
interests.
If the Beneficiary dies while receiving any remaining Annuity Payments due after
the death of the Annuitant, the value of the remainder of such Annuity Payments
will be paid in one sum to the Beneficiary's estate.
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ANNUITY TABLES
DOLLAR AMOUNT OF THE MONTHLY ANNUITY PAYMENT WHICH
IS PURCHASED WITH EACH $1,000 OF PROCEEDS APPLIED
OPTION 1,3 AND 4 - SINGLE LIFE ANNUITIES
Monthly Payments Guaranteed
Unit
Refund
Adjusted Age None 60 120 240
Male Female Option 1 Option 3 Option 3 Option 3 Option 4
50 54 $4.74 $4.73 $4.69 $4.52 $4.53
51 55 4.84 4.82 4.78 4.58 4.60
52 56 4.94 4.92 4.87 4.65 4.67
53 57 5.04 5.03 4.97 4.71 4.75
54 58 5.16 5.14 5.07 4.78 4.84
55 59 5.28 5.25 5.18 4.85 4.93
56 60 5.40 5.38 5.29 4.91 5.02
57 61 5.54 5.51 5.41 4.98 5.12
58 62 5.69 5.65 5.53 5.05 5.22
59 63 5.84 5.80 5.66 5.11 5.32
60 64 6.01 5.95 5.79 5.18 5.44
61 65 6.18 6.12 5.94 5.24 5.56
62 66 6.37 6.30 6.08 5.30 5.68
63 67 6.57 6.49 6.24 5.36 5.82
64 68 6.79 6.69 6.40 5.41 5.96
65 69 7.02 6.91 6.57 5.46 6.10
66 70 7.27 7.14 6.74 5.51 6.26
67 71 7.54 7.38 6.91 5.55 6.43
68 72 7.83 7.64 7.10 5.59 6.60
69 73 8.14 7.91 7.28 5.62 6.78
70 74 8.48 8.20 7.47 5.65 6.98
71 75 8.84 8.51 7.66 5.68 7.19
72 76 9.23 8.84 7.85 5.70 7.41
73 77 9.65 9.18 8.04 5.71 7.65
74 78 10.11 9.55 8.23 5.72 7.89
75 79 10.61 9.93 8.41 5.73 8.16
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint ............... Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.21 $4.35 $4.40 $4.47
55 59 4.37 4.58 4.66 4.78
57 61 4.43 4.67 4.77 4.90
60 64 4.51 4.80 4.92 5.00
62 66 4.55 4.88 5.01 5.22
65 69 4.62 4.99 5.15 5.39
70 74 4.70 5.14 5.34 5.65
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - Cont'd
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $4.51 $4.57 $4.64
55 59 4.85 4.94 5.07
57 61 4.99 5.10 5.26
60 64 5.20 5.36 5.59
62 66 5.35 5.54 5.82
65 69 5.56 5.81 6.19
70 74 5.88 6.23 6.83
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.58 $4.79 $4.89 $5.03
55 59 4.80 5.06 5.17 5.35
57 61 4.89 5.18 5.30 5.49
60 64 5.04 5.36 5.50 5.72
62 66 5.14 5.48 5.64 5.88
65 69 5.30 5.68 5.85 6.13
70 74 5.58 6.03 6.23 6.57
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.13 $5.29 $5.56
55 59 5.47 5.67 6.00
57 61 5.63 5.84 6.20
60 64 5.87 6.12 6.54
62 66 6.05 6.32 6.79
65 69 6.32 6.64 7.19
70 74 6.82 7.21 7.95
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.79 $5.05 $5.17 $5.37
55 59 5.05 5.34 5.47 5.69
57 61 5.17 5.47 5.61 5.84
60 64 5.36 5.69 5.84 6.09
62 66 5.50 5.85 6.01 6.28
65 69 5.73 6.11 6.28 6.58
70 74 6.16 6.60 6.81 7.15
Adjusted Age
of Joint Adjusted Age of Annuitant
Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.51 $5.74 $6.17
55 59 5.85 6.12 6.61
57 61 6.01 6.29 6.81
60 64 6.28 6.58 7.15
62 66 6.47 6.79 7.41
65 69 6.79 7.15 7.83
70 74 7.41 7.83 8.66
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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ENDORSEMENT
If the contract to which this Endorsement is attached becomes a claim because of
the death of the Annuitant, settlement plus interest at the rate then being paid
on Proceeds Left at Interest, but not less than 8% per year, calculated from the
date of death to the date of settlement, will be made upon receipt of due proof
of death and surrender of the contract. Benefits payable that have not been
tendered to the beneficiary within 90 days of the receipt of proof of death
shall accrue interest, commencing on the ninety-first day, at the aforementioned
rate plus three percent.
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VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity
With Additional Purchase Payment Option
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or
Fixed Basis
Non-Participating
17
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VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity
With Additional Purchase Payment Option
Accumulation of Values on a Variable CONTRACT
Basis NUMBER
Annuity Payment Options on Variable or
Fixed Basis
Non-Participating Annuitant
FIL Date of Issue
FIRST INVESTORS
LIFE INSURANCE COMPANY Issue Age
First Investors Life agrees to pay the Purchase Payment
benefits and other rights described in this
contract in accord with the terms of this Maturity Date
contract.
Signed for First Investors Life Insurance
Company at its Home Office in New York,
New York.
/s/Richard H. Gaebler
Richard H. Gaebler, President
/s/Carol L. Brown
Carol L. Brown, Secretary
10-DAY RIGHT TO EXAMINE CONTRACT
During a period of 10 days from the date this contract is delivered to the
Owner, it may be surrendered to the Company together with a written request
for cancellation of the contract and, in such event, the Company will pay to
the Owner an amount equal to the sum of (i) the difference between the Single
Purchase Payment made under this Contract and the amount allocated to the
Separate Account under this Contract and (ii) the Accumulated Value of this
Contract on the date of surrender. If the request for cancellation of the
contract is made prior to the actual delivery of the contract, the amount of
refund will be the entire Single Purchase Payment.
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THE ANNUAL INVESTMENT RETURN REQUIRED TO MAINTAIN LEVEL VARIABLE ANNUITY
PAYMENTS IS 5.65% (AFTER ANY APPLICABLE TAXES, BUT BEFORE ASSET CHARGES
TOTALING 1.4% FOR MORTALITY RISKS, EXPENSE RISKS AND CONTRACT MAINTENANCE
CHARGES AND MANAGEMENT FEES WHICH WILL NOT EXCEED .75% OF NET ASSETS OF
MUTUAL FUND IN WHICH SEPARATE ACCOUNT ASSETS ARE INVESTED). ANNUITY PAYMENTS
AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT
EXPERIENCE OF A SEPARATE ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO
FIXED-DOLLAR AMOUNT.
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CONTRACT DATA CONTRACT NUMBER 310000
ANNUITANT JOHN A. DOE
DATE OF ISSUE MARCH 14, 1997
ISSUE AGE 35
PURCHASE PAYMENT $25,000.00
MATURITY DATE MARCH 14, 2052
SEPARATE ACCOUNT
FIRST INVESTORS LIFE SEPARATE ACCOUNT D
MUTUAL FUND
FIRST INVESTORS LIFE SERIES FUND
PURCHASE PAYMENT WILL BE ALLOCATED
AS FOLLOWS:
25% to High Yield Series
25% to Discovery Series
25% to Growth Series
25% to Blue chip Series
UNIT EFFECTIVE DATE
MARCH 1, 1997
OWNER
ANNUITANT
BENEFICIARY DESIGNATION
REFER TO ENCLOSED APPLICATION
CONTINGENT DEFERRED SALES CHARGE UPON SURRENDER
REFER TO PAGE 9
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ALPHABETICAL GUIDE
PAGE
ACCUMULATION OF UNITS. . . . . . . . . . . . . . . . . . . . . . . . . . 5
ACCUMULATION UNIT VALUE. . . . . . . . . . . . . . . . . . . . . . . . . 6
ADDITIONAL PURCHASE PAYMENT. . . . . . . . . . . . . . . . . . . . . . . 5
ADJUSTMENT OF MONTHLY PAYMENT. . . . . . . . . . . . . . . . . . . . . . 7
ALLOCATION OF ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . 7
AMOUNT OF FIRST ANNUITY PAYMENT. . . . . . . . . . . . . . . . . . . . . 6
ANNUITY TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
ANNUITY UNIT VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
BENEFICIARY CHANGE . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
BENEFICIARY DESIGNATION. . . . . . . . . . . . . . . . . . . . . . . . . 9
CHANGE OF CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CHARGES AGAINST THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . 6
CHOICE OF ANNUITY OPTION . . . . . . . . . . . . . . . . . . . . . . . . 6
CLAIMS OF CREDITORS. . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CONTINGENT DEFERRED SALES CHARGE . . . . . . . . . . . . . . . . . . . . 9
CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
CONTRACT MAINTENANCE CHARGE. . . . . . . . . . . . . . . . . . . . . . . 6
CONTROL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
DEATH OF ANNUITANT . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
DEATH OF BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . 9
DEATH OF OWNER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ELECTION OF ANNUITY OPTIONS. . . . . . . . . . . . . . . . . . . . . . . 7
FIXED ANNUITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
INCONTESTABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
INITIAL PURCHASE PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . 5
INVESTMENT OF THE SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . 5
MATURITY DATE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
MISSTATEMENT OF AGE OR SEX . . . . . . . . . . . . . . . . . . . . . . . 4
MORE FAVORABLE PAYMENT OPTION. . . . . . . . . . . . . . . . . . . . . . 7
NET INVESTMENT FACTOR. . . . . . . . . . . . . . . . . . . . . . . . . . 6
NONPARTICIPATING . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
OWNERSHIP OF THE ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . 4
PROOF OF AGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
PROOF OF SURVIVAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
REPORTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SEPARATE ACCOUNT - GENERAL . . . . . . . . . . . . . . . . . . . . . . . 5
SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SURRENDER OPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
VALUATION OF ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . 6
VARIABLE ANNUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
VOTING RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE . . . . . . . . . . . . . . . . . 9
POLICY PROVISIONS
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
PURCHASE PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SEPARATE ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
BENEFICIARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
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GENERAL PROVISIONS
1. DEFINITIONS
As used in this Contract, the term:
(a) "Separate Account" means the account shown as such on page 3.
(b) "Valuation Date" means any date on which the New York Stock Exchange is
open for trading;
(c) "Valuation Period" means the period starting on the day after any Valuation
Date and ending on the next such Date;
(d) "Accumulation Unit" means a unit used to measure the value of an Owner's
interest in the Separate Account prior to the date on which annuity payments
commence;
(e) "Annuity Unit" means a unit used to determine the amount of each annuity
payment after the first;
(f) "Accumulated Value" means the value of all the Accumulation Units credited
to this Contract.
(g) "Purchase Payment" means an amount paid to the Company under this Contract
as a payment for the benefits described herein;
(h) "Variable Annuity" means an annuity with annuity payments varying in amount
in accordance with the net investment experience of the Separate Account;
(i) "Fixed-Dollar Annuity" means an annuity with annuity payments which stay
fixed as to dollar amount throughout the payment period;
(j) "Attained Age" of the annuitant on any date after the Date of Issue means
the age of the Annuitant at issue as shown on page 3 plus the number of years
elapsed from the Date of Issue to such date; and
(k) "Annuity Commencement Date" means the date on which annuity payments are to
commence. Also referred to as "Maturity Date" in this contract.
2. CONTRACT
This Contract, the application, and any riders attached to this Contract
constitute the whole contract. Only the President, a Vice President, the
Secretary, or an Assistant Secretary of the Company has the power, on behalf of
the Company, to change, modify or waive any provisions of this Contract. Any
changes, modifications, or waivers must be in writing. The Company will not be
bound by any promises or representations made by any agent or other person
except as specified above.
3. CONTROL
Consistent with the terms of any beneficiary designation and any assignment, the
Owner may, during the lifetime of the Annuitant:
1. assign this Contract or surrender it in whole or in part;
2. amend or change this Contract with the consent of the Company; and
3. exercise any right, receive any benefit, or enjoy any privilege in this
Contract.
The Company reserves the right to require this Contract for endorsement of any
assignment or change.
4. INCONTESTABILITY
This Contract will not be contested.
5. MISSTATEMENT OF AGE OR SEX
If the age or the sex of the Annuitant has been misstated, the benefits in this
Contract will be those which the Single Purchase Payment would have bought for
the right age and sex. Any amounts which should have been in the payments made
by the Company before the error was found will be made up right away. The
Company will pay interest at the rate of 6% per year on this additional amount.
Any excess amounts in the payments made by the Company before the error was
found will be charged against the payments which are due later.
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<PAGE>
6. ASSIGNMENT
No assignment of this Contract shall be binding on the Company unless it is in
writing and filed with the Company at its Home Office. The Company will assume
no responsibility of the validity or sufficiency of any assignment. Unless
otherwise provided in the assignment, the interest of any revocable beneficiary
shall be subordinate to the interest of any assignee, regardless of when the
assignment was made and the assignee shall receive any sum payable to the extent
of his interest.
7. OWNERSHIP OF THE ASSETS
The Company shall have exclusive and absolute ownership and control of its
assets, including all assets in the Separate Account.
8. VOTING RIGHTS
The Owner shall have the right to vote only at the meetings of the Fund.
Ownership of this Contract shall not entitle any person to vote at any meeting
of shareholders of the Company. Votes attributable to the Contract shall be
cast in conformity with applicable law.
9. REPORTS
At least once each Contract Year the Company shall mail a report to the Owner.
The report shall be mailed to the last address known to the Company. The report
shall include a statement of the number of units credited to this Contract and
the dollar value of such units. The information in the report shall be as of a
date not more than two months prior to the date of mailing the report. The
Company shall also mail to the Owner at least once in each Contract Year, a
report of the investments held in the Separate Account under this Contract.
10. PROOF OF AGE
Any annuity payment will be subject to proof of age of the payee which the
company will accept.
11. PROOF OF SURVIVAL
The Company has the right to ask for proof that the person on whom the payment
is based is alive when each payment is due.
12. SETTLEMENT
Any payment by the Company under this Contract is payable at its Home Office.
13. CLAIMS OF CREDITORS
To the extent allowed by law, Proceeds will not be subject to any claims of
creditors.
14. CHANGE OF CONTRACT
The Company keeps the right to change this Contract to meet the requirements of
the Investment Company Act of 1940 or other applicable federal or state laws or
regulations.
15. NONPARTICIPATING
This Contract is nonparticipating. It will not share in the surplus earnings of
the Company.
PURCHASE PAYMENTS
16. INITIAL PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue. The minimum Single
Purchase Payment which may be made is $25,000.
The Company will use the Initial Purchase Payment on the day it is received at
the Home Office to provide accumulation units, the number of which will be based
on that day's value of such units.
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17. ADDITIONAL PURCHASE PAYMENT OPTION
Additional Purchase Payments may be made at the option of the Owner at any time
up to the Maturity Date.
The Company will use the Additional Purchase Payment on the day it is received
at the Home Office to provide accumulation units, the number of which will be
based on that day's value of such units.
SEPARATE ACCOUNT
18. GENERAL
The Separate Account is a segregated investment account maintained by the
Company. A part of the assets of the Separate Account have been allocated for
this and certain other Contracts. The assets of the Separate Account are held
apart from the assets of the Company. Charges against these assets do not arise
out of any other business of the Company.
19. INVESTMENTS OF THE SEPARATE ACCOUNT
The assets of the Separate Account will be invested in shares of the mutual fund
shown on page 3 ("Fund"). The Fund is registered under the Investment Company
Act of 1940, as amended (the "Act").
The assets of each subaccount will be invested, as requested in the application
or as later requested in writing, in shares of the corresponding series of the
Fund shown on page 3. The assets may be allocated among at least one but not
more than five subaccounts. The Owner can change the allocation among the
subaccounts by furnishing notice to the Home Office. The change will take
effect when the Company receives this notice.
The Company may, in its discretion, invest the assets in shares of any other
fund or investment allowed by law.
All distributions from the Fund will be reinvested and kept as assets. When
needed to pay for surrenders, shares of the Fund held by the Separate Account
will be redeemed at net asset value.
20. ACCUMULATION UNITS
This Contract will be credited with the number of Accumulation Units of each
subaccount of the Separate Account bought by the amount of the Purchase Payment
allocated to each subaccount of the Separate Account.
This Contract will also be credited with the number of Accumulation Units of
each subaccount of the Separate Account bought by the amount of any Additional
Purchase Payment allocated to each subaccount of the Separate Account.
21a. CHARGES AGAINST THE SEPARATE ACCOUNT
The Company deducts an amount equal on a yearly basis to 1.4% of the daily net
asset value of each subaccount comprised of 1.25% to pay it for taking on
mortality and expense risks and .15% for taking on expenses related to
administration of the Contract.
21b. CONTRACT MAINTENANCE CHARGE
On the last business day of each Contract Year or on the date of surrender of
this Contract, if earlier, the Company will deduct a $30.00 Contract
Maintenance Charge from the Accumulated Value but in no case will this charge
exceed 2% of such value. It will be charged against the Accumulated Value by
proportionately reducing the number of Accumulation Units held on that date with
respect to each active subaccount of the Separate Account.
22. NET INVESTMENT FACTOR
The net investment factor for a subaccount of the Separate Account for any
Valuation Period is obtained by dividing (a) by (b) and subtracting (c) from the
result, where:
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(a) is the result of:
(1) the net asset value per share of the series of the Fund at the
end of the current Valuation Period, plus:
(2) the per share amount of any dividend or capital gains
distributions made by the series of the Fund during the current Valuation
Period, plus or minus:
(3) a per share charge or credit for any taxes reserved for.
(b) is the result of:
(1) the net asset value per share of the series of the Fund as of the
end of the preceding Valuation Period, plus or minus:
(2) the per share charge or credit for any taxes reserved for the
preceding Valuation Period.
(c) is a factor for the charges shown in Section 21a.
23. VALUATION OF ASSETS
Fund shares held in the Separate Account will be valued at their net asset
value. Other assets will be valued at fair market value.
24. ACCUMULATION UNIT VALUE
The value of an Accumulation Unit was set at $10.00 on the Unit Effective Date.
The value for a later period is obtained by multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end. The unit value may rise or fall based on investment results.
25. ANNUITY UNIT VALUE
The value of an Annuity Unit was set at $10.00 on the Unit Effective Date. The
value for a later period is obtained by first multiplying the unit value at the
start of the period by the Net Investment Factor for the period from its start
to its end and then multiplying the result by a factor which offsets the effect
of the assumed interest rate of 3.5% per year built into the table used in the
Contract.
BENEFITS
26. MATURITY DATE
Annuity payments will start on the Maturity Date shown on page 3. On written
request, it may be changed. But it will not be deferred beyond the Contract
Anniversary on which the attained age of the Annuitant is 90.
27. CHOICE OF ANNUITY OPTION
A choice of Annuity Option should be made by the Owner at least 30 days before
the Maturity Date.
If a choice is not made on time, payments will start on the Maturity Date on a
Variable Annuity basis with the Annuity Option as 10 years certain or life.
Once payments start, no further choice is allowed.
28. AMOUNT OF FIRST ANNUITY PAYMENT
Seven (7) days before the Maturity Date, any premium taxes not yet deducted will
be deducted from the Accumulated Value to determine the Net Accumulated Value.
Such value will then be applied to the proper Annuity Table on page 10 or 11 to
determine the amount of the first monthly annuity payment.
The amount of each payment depends on the sex and adjusted age of the Annuitant
and Joint Annuitant, if any, at the Maturity Date. The adjusted age is
determined at the time the first payment is due. For a payee born prior to
1900, the adjusted age is the actual age. For a payee born 1900 or
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later, the adjusted age is the actual age minus four years and also minus one
year for each completed five years during the period from 1900 to the payee's
year of birth.
The Company may, at its option, credit interest above the 3.5% per year rate
built into the tables used in this Contract.
29. ALLOCATION OF ANNUITY
When the Owner makes a choice as to annuity option, he or she will also choose
between a Fixed Annuity, a Variable Annuity or any combination of the two. If a
choice is not made at least 30 days before the Maturity Date, as stated in
Section 27, payments will be made on a Variable Annuity basis.
30. VARIABLE ANNUITY
A Variable Annuity is one with payments which vary as to dollar amount through
the annuity period based on the investment results of the Separate Account. The
method by which the amount of the first monthly payment is determined is shown
in Section 28.
Each payment for any due date after the first will be determined by multiplying
the Annuity Unit Value on the date seven days prior to the date on which the
payment is due by a constant number of Annuity Units. The payment may be less
than or greater than the preceding payment.
The constant number of Units is determined by dividing the dollar amount of the
first payment by the then current value of an Annuity Unit on the date the first
payment is due.
The Company guarantees that the dollar amount of each payment after the first
will not be affected by variations in mortality or expense experience from the
mortality and expense assumptions on which the first payment is based.
31. FIXED ANNUITY
A Fixed Annuity is one with payments which stay fixed as to dollar amount
through the annuity period. The method by which the amount of the first monthly
payment is determined is shown in Section 28. Later payments will not be less
than the first but a later payment may be more than the first if the Company
credits interest above the rate built into the tables.
32. ADJUSTMENT OF MONTHLY PAYMENT
If the Net Accumulated Value on the Maturity Date is less than $2,000, the
Company shall have the right to pay such value in one sum in lieu of payments
otherwise provided for. If the Net Accumulated Value is not less than $2,000
but either the Variable Annuity or the Fixed Annuity Payments provided for would
be or become less than $20, the Company shall have the right to change the
frequency of payment to such intervals as will result in payments of at least
$20.
33. MORE FAVORABLE PAYMENT OPTION
At the time fixed annuity payments begin, the single premium fixed annuity rates
then in use by the Company will be used if they provide a payment amount to the
payee greater than that shown in the table on page 10 or 11. Each $1,000 of
cash value shall be considered to be $1,030 for the purpose of using the single
premium annuity rates.
34. ELECTION OF ANNUITY OPTIONS
The owner may elect to have annuity payments made under any one of the Annuity
Options described below or in any other manner agreeable to the Company. Any
such election shall be made in writing to the Company at its Home Office at
least 30 days before the Maturity Date. The election may be changed in the same
manner at any time prior to the surrender of this Contract. If the amount of
payments for different guaranteed periods are the same at any given age, the
Company will deem the longer period certain to have been chosen.
OPTION 1 - LIFE ANNUITY - An annuity payable monthly during the lifetime of the
Annuitant, ceasing with the last payment due prior to his or her death.
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - an annuity payable monthly during
the joint lifetime of the
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Annuitant and the Joint Annuitant and continuing, after the death of either,
during the lifetime of the survivor, ceasing with the last payment due prior to
the death of the survivor.
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
two-thirds payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY - An annuity payable
monthly during the joint lifetime of the Annuitant and the Joint Annuitant and
continuing, after the death of either, during the lifetime of the survivor with
one-half payments, ceasing with the last payment due prior to the death of the
survivor.
OPTION 3 - LIFE ANNUITY WITH 60, 120 OR 240 MONTHLY PAYMENTS GUARANTEED - An
annuity payable monthly during the lifetime of the Annuitant, with the guarantee
that if, at his or her death, payments have been made for less than 60, 120 or
240 monthly period, as elected, any guaranteed annuity payments will be
continued during the remainder of the selected period to the Beneficiary.
OPTION 4 - UNIT REFUND LIFE ANNUITY - An annuity payable monthly during the
lifetime of the Annuitant, with the last payment due prior to his or her death,
provided further that, at such death, the Beneficiary will receive an additional
payment of the then dollar value of the number of Annuity Units equal to the
excess, if any, of (a) over (b) where (a) is the total amount applied under the
option divided by the Annuity Unit Value at the Maturity Date and (b) is the
product of the number of Annuity Units represented by each payment and the
number of payments made.
When this option is applied as a Fixed Annuity (a) shall be the Accumulated
Value applied at the Maturity Date to the Fixed Annuity, (b) shall be the sum of
all Fixed Annuity Payments made.
35. DEATH OF ANNUITANT
On receipt of due proof of the death of the Annuitant before Annuity Payments
have begun, the Company will pay the Death Benefit to the Beneficiary as of the
day on which such due proof is received by the Company. The Death Benefit will
be the greatest of the following amounts:
(a) The Accumulated Value on the date of receipt of Due Proof of Death at
the Home Office of the Company;
(b) The Accumulated Value on the Specified Contract Anniversary
immediately preceding the date of death, increased by the dollar
amount of any purchase payments made and reduced by the dollar amount
of any partial withdrawals since the immediately preceding Specified
Contract Anniversary;
or
(c) 100% of all purchase payments made under the Contract, reduced by the
dollar amount of any partial withdrawals since the Date of Issue.
The Specified Contract Anniversary is every seventh contract anniversary (i.e.
7th, 14th, 21st, etc.)
If the Annuitant and the Owner are one in the same at the time of the
Annuitant's death and the proceeds are payable to (or for the benefit of) the
Annuitant's surviving spouse, such spouse shall have the right to become the
Annuitant under the contract. If the Annuitant dies at a time when the Owner of
the contract is not an individual, the Annuitant will be considered to be the
Owner for the purpose of this section.
On receipt of due proof of death of the Annuitant after Annuity Payments have
begun under an Annuity Option, if any payments remain under the Option they will
be paid to the Beneficiary as provided by the Option.
Unless otherwise provided in the Beneficiary designation, if no Beneficiary
survives the Annuitant, the proceeds will be paid in one sum to the Owner, if
living; otherwise, to the Owner's estate.
36. DEATH OF OWNER
The purpose of this Section is to qualify this Contract as an annuity contract
in accordance with Section 72(s) of the Internal Revenue Code of 1986, as
amended ("Code"). Its provisions shall apply notwithstanding any other
provisions of the Contract in conflict therewith.
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In the event any Owner of this Contract who is not the Annuitant dies on or
after the Maturity Date and before the entire interest in the Contract has been
distributed, the remaining portion of such interest will be distributed at least
as rapidly as under the Annuity Option in effect as of the Date of the Owner's
death.
In the event any Owner of this Contract who is not the Annuitant dies prior to
the Maturity Date, the entire interest of that Owner in this Contract shall be
distributed to the Beneficiary within five years after the Owner's death, or
distributed under an Annuity Option providing for annuity payments over the life
of such Beneficiary or over a period not extending beyond the life expectancy of
such Beneficiary (in accordance with the regulations the Secretary of the
Treasury may prescribe), if such payments begin within one year after the date
of the Owner's death or such later date as the Secretary of the Treasury may
prescribe by regulations. In addition, if any portion of the Owner's interest
in this Contract is payable to (or for the benefit of) the Owner's surviving
spouse, that spouse shall be deemed to have been designated by the Owner as a
"designated beneficiary" for purpose of Section 72(s) of the Code, and shall be
treated as the Owner, and no distributions described hereinabove shall be
required, with respect to that portion of the Contract payable to (or for the
benefit of) such spouse. If the Owner who dies is the one named in the original
application for this Contract, the entire interest of that Owner in this
Contract will be the same as if the Owner had been the Annuitant; if the Owner
who dies is not the one named in the original application for this Contract, the
entire interest of that Owner shall be the Accumulated Value of this Contract.
37. SURRENDER OPTION
The Owner may turn this Contract in for its Surrender Value effective on the
date on which the request in writing is received at the Home Office. The value
will be the Accumulated Value on that date less (a) a Contingent Deferred Sales
Charge, if any, (b) the Contract Maintenance Charge and (c) any applicable
premium taxes not previously deducted.
Any cash payment will be mailed within 7 days after receipt of a proper request;
but the Company may be allowed to defer the payment under the Investment Company
Act of 1940 as it is in effect at that time. The Surrender Option is not
available after the Maturity Date.
38. WITHDRAWAL OPTION/WITHDRAWAL PRIVILEGE
The Owner may withdraw a part of the Surrender Value of this Contract effective
on the date on which the request in writing is received at the Home Office at
any time prior to the Maturity Date provided the Surrender Value remaining after
the surrender is at least equal to the Company's minimum amount rules then in
effect. If the remaining Surrender Value following such surrender is less than
the Company's minimum amount rules, the Company will terminate the contract and
pay the Surrender Value.
If applicable, a Contingent Deferred Sales Charge will be assessed against any
Accumulated Value surrendered. However, on a noncumulative basis, the Owner may
make partial surrenders during any Contract Year prior to the Maturity Date, up
to the Annual Withdrawal Privilege Amount of 10% of Purchase Payments and the
Contingent Deferred Sales Charge will not be assessed against such amounts.
Any Withdrawal Privilege Amount surrenders will be deemed to be from Accumulated
Values other than purchase payments. Surrender of Accumulated Values in excess
of the Withdrawal Privilege Amount and additional surrenders made in any
Contract Year will be subject to the Contingent Deferred Sales Charge, if
applicable.
39. CONTINGENT DEFERRED SALES CHARGE
A Contingent Deferred Sales Charge may be assessed against the Accumulated Value
when surrendered. The length of time from receipt of the purchase payment to
the time of surrender determines the charge. For this purpose, Purchase
Payments will be deemed to be surrendered in the order in which they were
received and all surrenders will be first from Purchase Payments and then from
other contract values. This charge is a percentage of the amount withdrawn (not
to exceed the aggregate amount of the Purchase Payments made) and equals:
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Length of time from
Contingent Deferred Purchase Payment
Sales Charge (Number of Years)
------------ -----------------
7% Less than 1
6% 1 - 2
5% 2 - 3
4% 3 - 4
3% 4 - 5
2% 5 - 6
1% 6 - 7
None More than 7
No Contingent Deferred Sales Charges will be assessed in the event of the death
of the Annuitant or the Owner (as applicable), or if contract values are applied
to an annuity option provided for under this contract or upon the exercise of
the Withdrawal Privilege.
BENEFICIARY
40. BENEFICIARY DESIGNATION
The Beneficiary will be as named in the application for this Contract unless the
designation has been changed by the Owner.
41. BENEFICIARY CHANGE
The Owner may change the designation while the Annuitant is alive unless
otherwise provided in the previous designation.
A change may be made by filing a written request with the Home Office. The
request must be in a form acceptable to the Company. The Company may require
this Contract for endorsement of a change.
42. DEATH OF BENEFICIARY
Unless otherwise provided, if any Beneficiary dies before the Annuitant, his or
her interest will pass to any other Beneficiaries according to their respective
interests.
If the Beneficiary dies while receiving any remaining Annuity Payments due after
the death of the Annuitant, the value of the remainder of such Annuity Payments
will be paid in one sum to the Beneficiary's estate.
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<PAGE>
ANNUITY TABLES
DOLLAR AMOUNT OF THE MONTHLY ANNUITY PAYMENT WHICH
IS PURCHASED WITH EACH $1,000 OF PROCEEDS APPLIED
OPTION 1,3 AND 4 - SINGLE LIFE ANNUITIES
Monthly Payments Guaranteed
Unit
Refund
Adjusted Age None 60 120 240
Male Female Option 1 Option 3 Option 3 Option 3 Option 4
50 54 $4.74 $4.73 $4.69 $4.52 $4.53
51 55 4.84 4.82 4.78 4.58 4.60
52 56 4.94 4.92 4.87 4.65 4.67
53 57 5.04 5.03 4.97 4.71 4.75
54 58 5.16 5.14 5.07 4.78 4.84
55 59 5.28 5.25 5.18 4.85 4.93
56 60 5.40 5.38 5.29 4.91 5.02
57 61 5.54 5.51 5.41 4.98 5.12
58 62 5.69 5.65 5.53 5.05 5.22
59 63 5.84 5.80 5.66 5.11 5.32
60 64 6.01 5.95 5.79 5.18 5.44
61 65 6.18 6.12 5.94 5.24 5.56
62 66 6.37 6.30 6.08 5.30 5.68
63 67 6.57 6.49 6.24 5.36 5.82
64 68 6.79 6.69 6.40 5.41 5.96
65 69 7.02 6.91 6.57 5.46 6.10
66 70 7.27 7.14 6.74 5.51 6.26
67 71 7.54 7.38 6.91 5.55 6.43
68 72 7.83 7.64 7.10 5.59 6.60
69 73 8.14 7.91 7.28 5.62 6.78
70 74 8.48 8.20 7.47 5.65 6.98
71 75 8.84 8.51 7.66 5.68 7.19
72 76 9.23 8.84 7.85 5.70 7.41
73 77 9.65 9.18 8.04 5.71 7.65
74 78 10.11 9.55 8.23 5.72 7.89
75 79 10.61 9.93 8.41 5.73 8.16
OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint .......... Adjusted Age of Annuitant
Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.21 $4.35 $4.40 $4.47
55 59 4.37 4.58 4.66 4.78
57 61 4.43 4.67 4.77 4.90
60 64 4.51 4.80 4.92 5.00
62 66 4.55 4.88 5.01 5.22
65 69 4.62 4.99 5.15 5.39
70 74 4.70 5.14 5.34 5.65
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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OPTION 2a - JOINT AND SURVIVOR LIFE ANNUITY - Cont'd
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $4.51 $4.57 $4.64
55 59 4.85 4.94 5.07
57 61 4.99 5.10 5.26
60 64 5.20 5.36 5.59
62 66 5.35 5.54 5.82
65 69 5.56 5.81 6.19
70 74 5.88 6.23 6.83
OPTION 2b - JOINT AND TWO-THIRDS TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.58 $4.79 $4.89 $5.03
55 59 4.80 5.06 5.17 5.35
57 61 4.89 5.18 5.30 5.49
60 64 5.04 5.36 5.50 5.72
62 66 5.14 5.48 5.64 5.88
65 69 5.30 5.68 5.85 6.13
70 74 5.58 6.03 6.23 6.57
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.13 $5.29 $5.56
55 59 5.47 5.67 6.00
57 61 5.63 5.84 6.20
60 64 5.87 6.12 6.54
62 66 6.05 6.32 6.79
65 69 6.32 6.64 7.19
70 74 6.82 7.21 7.95
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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<PAGE>
OPTION 2c - JOINT AND ONE-HALF TO SURVIVOR LIFE ANNUITY
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 51 Male 56 Male 58 Male 61
Male Female Female 55 Female 60 Female 62 Female 65
50 54 $4.79 $5.05 $5.17 $5.37
55 59 5.05 5.34 5.47 5.69
57 61 5.17 5.47 5.61 5.84
60 64 5.36 5.69 5.84 6.09
62 66 5.50 5.85 6.01 6.28
65 69 5.73 6.11 6.28 6.58
70 74 6.16 6.60 6.81 7.15
Adjusted Age
of Joint
Annuitant Adjusted Age of Annuitant
Male 63 Male 66 Male 71
Male Female Female 67 Female 70 Female 75
50 54 $5.51 $5.74 $6.17
55 59 5.85 6.12 6.61
57 61 6.01 6.29 6.81
60 64 6.28 6.58 7.15
62 66 6.47 6.79 7.41
65 69 6.79 7.15 7.83
70 74 7.41 7.83 8.66
The dollar amount of the monthly annuity payments for any age or combination of
ages not shown in the above tables will be calculated on the same basis as the
monthly annuity payments for those shown and may be obtained from the Company.
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<PAGE>
VARIABLE
ANNUITY
CONTRACT
Single Payment Deferred Variable Annuity
With Additional Purchase Payment Option
Accumulation of Values on a Variable Basis
Annuity Payment Options on Variable or
Fixed Basis
Non-Participating
16
<PAGE>
If you have any questions concerning this Contract or if anyone suggests that
you change or replace this Contract, please contact your First Investors Life
agent or the Home Office of the Company.
FIL
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street / New York, N.Y. 10005
<PAGE>
Tammie Lee
ATTORNEY AT LAW
95 Wall Street
23rd Floor
New York, NY 10005
-----------------
(212) 858-8144
July 7, 1997
First Investors Life Insurance Company
Variable Annuity Fund D
95 Wall Street
New York, New York 10005
Gentlemen:
As special counsel to First Investors Life Insurance Company (the
"Depositor"), I am familiar with the proceedings taken and proposed to be taken
by the First Investors Life Variable Annuity Fund D ("Separate Account D") in
connection with the proposed sale of an indefinite number of units of interest
of Separate Account D (the "Securities") and the registration statement on Form
N-4 covering the Securities (the "Registration Statement") to which this opinion
is an exhibit, filed by Separate Account D pursuant to the Securities Act of
1933 and the Investment Company Act of 1940, as amended. I have examined such
records of the Depositor and of Separate Account D, certificates of public
officials and other documents and such questions of law as I have deemed
necessary as a basis for this opinion.
Based upon such examination, I am of the opinion that when the Registration
Statement becomes effective and the Securities are issued according to the terms
set forth in the General Plan of Operations for Separate Account D filed by the
Depositor with the New York State Insurance Department, as described in the
Prospectus and Statement of Additional Information included in the Registration
Statement, the Securities will be legally issued and will represent binding
obligations of the Depositor. As to various questions of fact material to my
opinion I have relied upon representations of the Depositor.
I hereby consent to the filing of the opinion as an exhibit to the
Registration Statement. In giving such consent, I do not thereby admit that I
am acting within the category of persons whose consent is required under Section
7 of the Securities Act of 1933, or the rules and regulations of the Securities
and Exchange Commission thereunder.
Very truly yours,
/s/Tammie Lee
Tammie Lee
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
First Investors Life Insurance Company
95 Wall Street
New York, NY 10005
We hereby consent to the use in Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-4 (File No. 333-26341) of our report dated
February 24, 1997 relating to the December 31, 1996 financial statements of
First Investors Life Insurance Company, which are included in said Registration
Statement.
/s/Tait, Weller & Baker
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
July 3, 1997
