JNLNY SEPARATE ACCOUNT I, 497, 1999-01-07

JNLNY SEPARATE ACCOUNT I
497, 1999-01-07

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THE PERSPECTIVE
FIXED AND VARIABLE ANNUITY

Issued by Jackson National Life Insurance Company of New York and JNLNY Separate
Account I

o Individual, flexible premium deferred annuity
o 4 guaranteed accounts which offer an interest rate that is guaranteed by
Jackson National Life Insurance Company of New York (Jackson National NY)
o 14 investment portfolios which purchase shares of the following series of
the JNL Series Trust:

JNL/Alger Growth Series
JNL/Janus Aggressive Growth Series
JNL/Janus Capital Growth Series
JNL/Janus Global Equities Series
JNL/Putnam Growth Series
JNL/Putnam Value Equity Series
PPM America/JNL Balanced Series
PPM America/JNL High Yield Bond Series
PPM America/JNL Money Market Series
Salomon Brothers/JNL Global Bond Series
Salomon Brothers/JNL U.S. Government & Quality Bond Series
T. Rowe Price/JNL Established Growth Series
T. Rowe Price/JNL International Equity Investment Series
T. Rowe Price/JNL Mid-Cap Growth Series

Please read this prospectus before you purchase a Perspective Fixed and Variable
Annuity. It contains important information about the contract that you ought to
know before investing. You should keep this prospectus on file for future
reference.

To learn more about the Perspective Fixed and Variable Annuity contract, you can
obtain a free copy of the Statement of Additional Information (SAI) dated
January 4, 1999, by calling Jackson National NY at (800) 599-5651 or by writing
Jackson National NY at: Annuity Service Center, P.O. Box 0809, Denver, Colorado
80263-0809. The SAI has been filed with the Securities and Exchange Commission
(SEC) and is legally a part of this prospectus. The Table of Contents of the SAI
appears at the end of this prospectus. The SEC maintains a website
(http://www.sec.gov) that contains the SAI, material incorporated by reference
and other information regarding registrants that file electronically with the
SEC.

The SEC has not approved or disapproved the Perspective Fixed and Variable
Annuity or passed upon the adequacy of this prospectus. It is a criminal offense
to represent otherwise.

NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE

January 4, 1999

<PAGE>

TABLE OF CONTENTS

Key Facts

Fee Table

The Annuity Contract

The Company

The Guaranteed Accounts

The Separate Account

Investment Portfolios

Contract Charges

Purchases

Transfers

Access to Your Money

Income Payments (The Income Phase)

Death Benefit

Taxes

Other Information

Table of Contents of the Statement of Additional Information

<PAGE>

KEY FACTS

Annuity Service Center: 1 (800) 599-5651
Mail Address: P.O. Box 0809, Denver, Colorado 80263-0809
Delivery Address: 8055 East Tufts Avenue, Second Floor,
Denver, Colorado 80237

Institutional Marketing
Group Service Center: 1 (800) 777-7779
Mail Address: P.O. Box 30386, Lansing, Michigan 48909-9692
Delivery Address: 5901 Executive Drive, Lansing, Michigan 48911
Attn: IMG

Home Office: 2900 Westchester Avenue, Purchase, New York 10577

The Annuity Contract The fixed and variable annuity contract offered by
Jackson National NY provides a means for investing
on a tax-deferred basis in the guaranteed accounts
of Jackson National NY and the investment
portfolios. The contract is intended for
retirement savings or other long-term investment
purposes and provides for a death benefit and
income options.

The contract has two phases: the accumulation
phase and the income phase. During the
accumulation phase, earnings accumulate on a
tax-deferred basis and are taxed as income when
you make a withdrawal. The income phase occurs
when you begin receiving regular payments from
your contract. The amount of money you accumulate
in your contract during the accumulation phase
will determine the amount of income payments
during the income phase.

Investment Options You can put money into any of the guaranteed
accounts and/or the investment portfolios but you
may not put your money in more than eighteen of
the investment options during the life of your
contract.

The guaranteed accounts offer an interest rate
that is guaranteed by Jackson National NY. While
your money is in a guaranteed account, the
interest your money earns and your principal are
guaranteed by Jackson National NY.

The investment portfolios purchase shares of
series a of mutual fund. These series are
described in the attached JNL Series Trust
prospectus. The value of the investment portfolios
will vary in accordance with the investment
performance of the series. You bear the investment
risk under the contract for all amounts allocated
to the investment portfolios.

Expenses The contract has insurance features and investment
features, and there are costs related to each.

Jackson National NY makes a deduction for its
insurance charges which is equal to 1.40% of the
daily value of the contracts invested in the
investment portfolios. During the accumulation
phase, Jackson National NY deducts a $30 annual
contract maintenance charge from your contract.

If you take your money out of the contract,
Jackson National NY may assess a withdrawal
charge. The withdrawal charge starts at 7% in the
first year and declines 1% a year to 0% after 7
years.

There are also investment charges which range from
.20% to 1.18% of the average daily value of the
series, depending on the series.

Purchases Under most circumstances, you can buy a contract
for $5,000 or more ($2,000 or more for a qualified
plan contract). You can add $500 ($50 under the
automatic payment plan) or more at any time during
the accumulation phase.

Access to Your Money You can take money out of your contract during the
accumulation phase. At any time during the
accumulation phase, you may withdraw premiums
which are not subject to a withdrawal charge
(premiums in your annuity for seven years or
longer and not previously withdrawn). Once every
year, you may withdraw the greater of earnings or
10% of premiums paid (not yet withdrawn).
Withdrawals in excess of that will be charged a
withdrawal charge. You may also have to pay income
tax and a tax penalty on any money you take out.

Income Payments If you want to receive regular income from your
annuity, you can choose one of four options:

(1) monthly payments for the annuitant's
life;
(2) monthly payments for the annuitant's
life and the life of another person
(usually the annuitant's spouse);
(3) monthly payments for the annuitant's
life, but with payments continuing to
you or your designated beneficiary for
10 or 20 years if the annuitant dies
before the end of the selected period;
and
(4) payments for a period of 5 to 30 years.

During the income phase, you have the same
investment choices you had during the accumulation
phase. You can choose to have payments come from
the guaranteed accounts, the investment portfolios
or both. If you choose to have any part of your
payments come from the investment portfolios, the
dollar amount of your payments may go up or down.
If you choose a variable income option, you may
make transfers between investment portfolios but
you may not make transfers in to or out of the
guaranteed accounts.

Death Benefit If you die before moving to the income phase, the
person you have chosen as your beneficiary will
receive a death benefit. The death benefit equals:
(1) current contract value or (2) the total
premiums (less withdrawals, withdrawal charges and
premium taxes) or (3) the contract value at the
end of the 7th contract year PLUS all premiums
made since the 7th year (less withdrawals,
withdrawal charges and premium taxes) -- whichever
is GREATEST.

The death benefit under (3) will never exceed 250%
of premiums paid, less partial withdrawals.

Free Look You may return your contract to the selling agent
or to Jackson National NY within twenty days after
receiving it. Jackson National NY will return the
contract value in the investment portfolios plus
any fees and expenses deducted from the premium
allocated to the investment portfolios plus the
full amount of premium you allocated to the
guaranteed accounts. We will determine the
contract value in the investment portfolios as of
the date you mail the contract to us or the date
you return it to the selling agent. Jackson
National NY will return premium payments where
required by law.

Taxes The Internal Revenue Code provides that you will
not be taxed on the earnings on the money held in
your contract until you take money out (this is
referred to as tax-deferral). There are different
rules as to how you will be taxed depending on how
you take the money out and the type of contract
you have (non-qualified or qualified).

<PAGE>

FEE TABLE

Owner Transaction Expenses

Withdrawal Charge (as a percentage of premium payments):
Contribution Year of Premium Payment 1 2 3 4 5 6 7 Thereafter
Charge 7% 6% 5% 4% 3% 2% 1% 0%

Transfer Fee:
No charge for first 15 transfers in a contract year; thereafter, the
fee is $25 per transfer.

Contract Maintenance Charge:
$30 per contract per year

Separate Account Annual Expenses (as a percentage of average account value)
Mortality and Expense Risk Charges 1.25%
Administration Charge .15%
Total Separate Account Annual Expenses 1.40%

Series Annual Expenses
(as a percentage of series average net assets)

Management Total
JNL Series Trust and Series
Administrative Other Annual
Fee Expenses Expenses
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
JNL/Alger Growth Series 1.075% 0% 1.075%
JNL/Janus Aggressive Growth Series 1.05% 0% 1.05%
JNL/Janus Capital Growth Series 1.05% 0% 1.05%
JNL/Janus Global Equities Series 1.10% 0% 1.10%
JNL/Putnam Growth Series 1.00% 0% 1.00%
JNL/Putnam Value Equity Series 1.00% 0% 1.00%
PPM America/JNL Balanced Series .84% 0% .84%
PPM America/JNL High Yield Bond Series .84% 0% .84%
PPM America/JNL Money Market Series .70% 0% .70%
Salomon Brothers/JNL Global Bond Series .95% 0% .95%
Salomon Brothers/JNL U.S. Government & Quality Bond Series .80% 0% .80%
T. Rowe Price/JNL Established Growth Series .95% 0% .95%
T. Rowe Price/JNL International Equity Investment Series 1.18% 0% 1.18%
T. Rowe Price/JNL Mid-Cap Growth Series 1.05% 0% 1.05%
- -------------------------------------------------------------------------------------------------------------
</TABLE>

Effective January 4, 1999, certain Series pay Jackson National Financial
Services, LLC, the adviser, an Administrative Fee of .10% for certain services
provided to the Trust by Jackson National Financial Services, LLC. The Annual
Series Operating Expenses have been restated to reflect the Administrative Fee.

Examples. You would pay the following expenses on a $1,000 investment, assuming
a 5% annual return on assets:
(a) if you surrender your contract at the end of each time
period;
(b) if you do not surrender your contract.
<TABLE>
<CAPTION>

Time Periods
- -------------------------------------------------------------------------------------------------------------
1 3
year years
- -------------------------------------------------------------------------------------------------------------

<S> <C> <C>
JNL/Alger Growth Portfolio (a) $95 $128
(b) 25 78
JNL/Janus Aggressive Growth Portfolio (a) 95 128
(b) 25 78
JNL/Janus Capital Growth Portfolio (a) 95 128
(b) 25 78
JNL/Janus Global Equities Portfolio (a) 96 129
(b) 26 79
JNL/Putnam Growth Portfolio (a) 95 126
(b) 25 76
JNL/Putnam Value Equity Portfolio (a) 95 126
(b) 25 76
PPM America/JNL Balanced Portfolio (a) 93 121
(b) 23 71
PPM America/JNL High Yield Bond Portfolio (a) 93 121
(b) 23 71
PPM America/JNL Money Market Portfolio (a) 92 117
(b) 22 67
Salomon Brothers/JNL Global Bond Portfolio (a) 94 125
(b) 24 75
Salomon Brothers/JNL U.S. Government & Quality Bond Portfolio (a) 93 120
(b) 23 70
T. Rowe Price/JNL Established Growth Portfolio (a) 94 125
(b) 24 75
T. Rowe Price/JNL International Equity Investment Portfolio (a) 97 131
(b) 27 81
T. Rowe Price/JNL Mid-Cap Growth Portfolio (a) 95 128
(b) 25 78
- -------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

Explanation of Fee Table and Examples. The purpose of the Fee Table and Examples
is to assist you in understanding the various costs and expenses that you will
bear directly or indirectly. The Fee Table reflects the expenses of the separate
account and the series. Premium taxes may also apply.

The Examples reflect the contract maintenance charge which is determined by
dividing the total amount of such charges expected to be collected during the
year by the total estimated average net assets of the investment portfolios.

The Example does not represent past or future expenses. The actual expenses that
you incur may be greater or less than those shown.

Financial Statements. You can find the following financial statements in the
SAI:

o the financial statements of Jackson National Life Insurance Company of New
York for the year ended December 31, 1997
o the financial statements of Jackson National Life Insurance Company of New
York for the year ended December 31, 1996

Jackson National NY's financial statements have been audited by
PricewaterhouseCoopers LLP, independent accountants. There are no financial
statements for JNLNY Separate Account I because, as of June 30, 1998, it had no
assets.

<PAGE>

THE ANNUITY CONTRACT

The fixed and variable annuity contract offered by Jackson National NY is a
contract between you, the owner, and Jackson National NY, an insurance company.
The contract provides a means for investing on a tax-deferred basis in
guaranteed accounts and investment portfolios. The contract is intended for
retirement savings or other long-term investment purposes and provides for a
death benefit and guaranteed income options.

The contract, like all deferred annuity contracts, has two phases: (1) the
accumulation phase, and (2) the income phase. During the accumulation phase,
earnings accumulate on a tax-deferred basis and are taxed as income when you
make a withdrawal.

The contract offers guaranteed accounts. The guaranteed accounts offer an
interest rate that is guaranteed by Jackson National NY for the duration of the
guaranteed account period. While your money is in a guaranteed account, the
interest your money earns and your principal are guaranteed by Jackson National
NY. The value of a guaranteed account may be reduced if you make a withdrawal
prior to the end of the guaranteed account period, but will never be less than
the premium payments accumulated at 3% per year. If you choose to have your
annuity payments come from the guaranteed accounts, your payments will remain
level throughout the entire income phase.

The contract also offers investment portfolios. The investment portfolios are
designed to offer a higher return than the guaranteed accounts. However, this is
not guaranteed. It is possible for you to lose your money. If you put money in
the investment portfolios, the amount of money you are able to accumulate in
your contract during the accumulation phase depends upon the performance of the
investment portfolios you select. The amount of the income payments you receive
during the income phase also will depend, in part, on the performance of the
investment portfolios you choose for the income phase.

As the owner, you can exercise all the rights under the contract. You and your
spouse can be joint owners. You can assign the contract at any time during your
lifetime but Jackson National NY will not be bound until we receive written
notice of the assignment.

THE COMPANY

Jackson National NY is a stock life insurance company organized under the laws
of the state of New York in July 1995. Its legal domicile and principal business
address is 2900 Westchester Avenue, Purchase, New York 10577. Jackson National
NY is admitted to conduct life insurance and annuity business in the states of
New York and Michigan. Jackson National NY is ultimately a wholly-owned
subsidiary of Prudential Corporation plc (London, England).

THE GUARANTEED ACCOUNTS

If you select a guaranteed account, your money will be placed with Jackson
National NY's other assets. The guaranteed accounts are not registered with the
SEC and the SEC does not review the information we provide to you about the
guaranteed accounts. Your contract contains a more complete description of the
guaranteed accounts.

THE SEPARATE ACCOUNT

The JNLNY Separate Account I was established by Jackson National NY on September
12, 1997, pursuant to the provisions of New York law, as a segregated asset
account of the company. The separate account meets the definition of a "separate
account" under the federal securities laws and is registered with the SEC as a
unit investment trust under the Investment Company Act of 1940, as amended.

The assets of the separate account legally belong to Jackson National NY and the
obligations under the contracts are obligations of Jackson National NY. However,
the contract assets in the separate account are not chargeable with liabilities
arising out of any other business Jackson National NY may conduct. All of the
income, gains and losses resulting from these assets are credited to or charged
against the contracts and not against any other contracts Jackson National NY
may issue.

The separate account is divided into investment portfolios. Jackson National NY
does not guarantee the investment performance of the separate account or the
investment portfolios.

INVESTMENT PORTFOLIOS

You can put money in any or all of the investment portfolios; however, you may
not allocate your money to more than eighteen investment options during the life
of your contract.. The investment portfolios purchase shares of the following
series of the JNL Series Trust:

The series are described in the attached JNL Series Trust prospectus. Jackson
National Financial Services, LLC serves as investment adviser for all of the
series. The sub-adviser for each series is listed in the following table:

Sub-Adviser Series
- ----------- ------

<S> <C>
Fred Alger Management, Inc. JNL/Alger Growth Series

Janus Capital Corporation JNL/Janus Aggressive Growth Series
JNL/Janus Capital Growth Series
JNL/Janus Global Equities Series

Putnam Investment Management, Inc. JNL/Putnam Growth Series
JNL/Putnam Value Equity Series

PPM America, Inc. PPM America/JNL Balanced Series
PPM America/JNL High Yield Bond Series
PPM America/JNL Money Market Series

Salomon Brothers Asset Management Inc Salomon Brothers/JNL Global Bond Series
Salomon Brothers/JNL U.S. Government & Quality Bond
Series

Rowe Price-Fleming International, Inc. T. Rowe Price/JNL International Equity Investment
Series

T. Rowe Price Associates, Inc. T. Rowe Price/JNL Established Growth Series
T. Rowe Price/JNL Mid-Cap Growth Series

</TABLE>

Depending on market conditions, you can make or lose money in any of the
investment portfolios. You should read the JNL Series Trust prospectus carefully
before investing. Additional investment portfolios may be available in the
future.

Voting Rights. To the extent required by law, Jackson National NY will obtain
from you and other owners of the contracts instructions as to how to vote when
the series solicits proxies in conjunction with a vote of shareholders. When
Jackson National NY receives instructions, we will vote all the shares Jackson
National NY owns in proportion to those instructions.

Substitution. Jackson National NY may be required to substitute an investment
portfolio with another portfolio. We will not do this without the prior approval
of the SEC. Jackson National NY will give you notice of our intent to do this.

CONTRACT CHARGES

There are charges and other expenses associated with the contracts that reduce
the return on your investment in the contract. These charges may be a lesser
amount where required by state law or as described below, but will not be
increased. These charges and expenses are:

Insurance Charges. Each day Jackson National NY makes a deduction for its
insurance charges. We do this as part of our calculation of the value of the
accumulation units and annuity units. On an annual basis, this charge equals
1.40% of the daily value of the contracts invested in an investment portfolio,
after expenses have been deducted.

This charge is for the mortality risks, expense risks and administrative
expenses assumed by Jackson National NY. The mortality risks that Jackson
National NY assumes arise from our obligations under the contracts:

o to make income payments for the life of the annuitant during the income phase;
o to waive the withdrawal charge in the event of your death; and o to provide
both a standard and an enhanced death benefit prior to the income date.

The expense risk that Jackson National NY assumes is the risk that our actual
cost of administering the contracts and the investment portfolios will exceed
the amount that we receive from the administration charge and the contract
maintenance charge.

Contract Maintenance Charge. During the accumulation phase, Jackson National NY
deducts a $30 annual contract maintenance charge on each anniversary of the date
on which your contract was issued. If you make a complete withdrawal from your
contract, the contract maintenance charge will also be deducted. This charge is
for administrative expenses.

Jackson National NY will not deduct this charge, if when the deduction is to be
made, the value of your contract is $50,000 or more. Jackson National NY may
discontinue this practice at any time.

Transfer Fee. A transfer fee of $25 will apply to transfers in excess of 15 in a
contract year. Jackson National NY may waive the transfer fee in connection with
pre-authorized automatic transfer programs, or may charge a lesser fee where
required by state law.

Withdrawal Charge. During the accumulation phase, you can make withdrawals from
your contract.

o At any time during the accumulation phase, you may withdraw premiums which
are not subject to a withdrawal charge (premiums in your annuity for seven
years or longer and not previously withdrawn).
o Once every year, you may withdraw the greater of earnings or 10% of
premiums paid (not yet withdrawn).

Withdrawals in excess of that will be charged a withdrawal charge starting at 7%
in the first year and declining 1% a year to 0% after 7 years. The withdrawal
charge compensates us for costs associated with selling the contracts.

For purposes of the withdrawal charge, Jackson National NY treats withdrawals as
coming from the oldest premium payment first. If you make a full withdrawal, the
withdrawal charge is based on premiums remaining in the contract. If you
withdraw only part of the value of your contract, we deduct the withdrawal
charge from the remaining value in your contract.

Note: For tax purposes, withdrawals are considered to have come from the
last money into the contract. Thus, for tax purposes, earnings are considered to
come out first.

Jackson National NY does not assess the withdrawal charge on any payments paid
out as (1) income payments, (2) death benefits, or (3) withdrawals necessary to
satisfy the minimum distribution requirements of the Internal Revenue Code.

Jackson National NY may reduce or eliminate the amount of the withdrawal charge
when the contract is sold under circumstances which reduce its sales expense.
Some examples are: the purchase of a contract by a large group of individuals or
an existing relationship between Jackson National NY and a prospective
purchaser. Jackson National NY will not deduct a withdrawal charge under a
contract issued to an officer, director, agent or employee of Jackson National
NY or any of its affiliates.

Other Expenses. Jackson National NY pays the operating expenses of the Separate
Account.

There are deductions from and expenses paid out of the assets of the series.
These expenses are described in the attached JNL Series Trust prospectus.

Premium Taxes. Some governmental entities charge premium taxes or other similar
taxes. Jackson National NY is responsible for the payment of these taxes and may
make a deduction from the value of the contract for them. Premium taxes
generally range from 0% to 4% depending on the state. New York does not
currently impose a premium tax on annuity premiums.

Income Taxes. Jackson National NY will make a deduction from the contract for
any income taxes which it incurs because of the contract. Currently, we are not
making any such deduction.

Distribution of Contracts. Jackson National Life Distributors, Inc. is located
at 10877 Wilshire Boulevard, Suite 1550, Los Angeles, California 90024 and
serves as the distributor of the contracts. Jackson National Life Distributors,
Inc. and Jackson National NY are wholly-owned subsidiaries of Jackson National
Life Insurance Company.

Commissions will be paid to broker-dealers who sell the contracts. While
commissions may vary, they are not expected to exceed 8% of any premium payment.
Under certain circumstances, Jackson National NY may pay bonuses, overrides, and
marketing allowances, in addition to the standard commissions. Jackson National
NY may under certain circumstances where permitted by applicable law, pay a
bonus to a contract purchaser to the extent the broker-dealer waives its
commission. Jackson National NY may use any of its corporate assets to cover the
cost of distribution, including any profit from the contract insurance charges.

PURCHASES

Minimum Initial Premium:

o $5,000 under most circumstances
o $2,000 for a qualified plan contract

The maximum we accept without our prior approval is $1 million.

You can add $500 ($50 under the automatic payment plan) at any time during the
accumulation phase.

The minimum that you may allocate to a guaranteed account or investment
portfolio is $100. There is a $100 minimum balance requirement for each
guaranteed account and investment portfolio.

When you purchase a contract, Jackson National NY will allocate your premium to
one or more of the guaranteed accounts and/or the investment portfolios you have
selected. Your allocations must be in whole percentages ranging from 0% to 100%.
Jackson National NY will allocate additional premiums in the same way unless you
tell us otherwise.

There may be more than eighteen investment options available under the contract;
however, you may not allocate your money to more than eighteen investment
options during the life of your contract.

Jackson National NY will issue your contract and allocate your first premium
within 2 business days after we receive your complete application and first
premium. If your application is not complete, we will contact you to get the
necessary information. If for some reason Jackson National NY is unable to
complete this process within 5 business days, we will either return your money
or get your permission to keep it until we receive all of the necessary
information.

The Jackson National NY business day closes when the New York Stock Exchange
closes, usually 4:00 p.m. Eastern time.

Accumulation Units. The contract value allocated to the investment portfolios
will go up or down depending on the performance of the portfolios. In order to
keep track of the value of your contract, Jackson National NY uses a unit of
measure called an accumulation unit. (An accumulation unit is similar to a share
of a mutual fund.) During the income phase it is called an annuity unit.

Every business day Jackson National NY determines the value of an accumulation
unit for each of the investment portfolios. This is done by:

1. determining the total amount of money invested in the particular
investment portfolio;

2. subtracting any insurance charges and any other charges, such as
taxes;

3. dividing this amount by the number of outstanding accumulation units.

The value of an accumulation unit may go up or down from day to day.

When you make a premium payment, Jackson National NY credits your contract with
accumulation units. The number of accumulation units credited is determined at
the close of Jackson National NY's business day by dividing the amount of the
premium allocated to any investment portfolio by the value of the accumulation
unit for that investment portfolio.

TRANSFERS

You can transfer money between guaranteed accounts and investment portfolios
during the accumulation phase. During the income phase, you can transfer money
between investment portfolios.

You can make 15 transfers every year during the accumulation phase without
charge. The minimum amount that you can transfer is $100 (unless the transfer is
made under a pre-authorized automatic transfer program). If the remaining value
in a guaranteed account or investment portfolio would be less than $100 after a
transfer, you must transfer the entire value or you may not make the transfer.

Telephone Transactions. You may make transfers by telephone, unless you elect on
your application not to have this privilege. When authorizing a transfer, you
must complete your telephone call by the close of Jackson National NY's business
day (usually 4:00 p.m. Eastern time) in order to receive that day's accumulation
unit value for an investment portfolio.

Jackson National NY has procedures which are designed to provide reasonable
assurance that telephone authorizations are genuine. Our procedures include
requesting identifying information and tape recording telephone communications.
Jackson National NY and its affiliates disclaim all liability for any claim,
loss or expense resulting from any alleged error or mistake in connection with a
telephone transfer which was not properly authorized by you. However, if Jackson
National NY fails to employ reasonable procedures to ensure that all telephone
transfers are properly authorized, we may be held liable for such losses.
Jackson National NY reserves the right to modify or discontinue at any time and
without notice the acceptance of instructions from someone other than you and/or
the telephone transfer privilege.

ACCESS TO YOUR MONEY

You can have access to the money in your contract:

o by making either a partial or complete withdrawal, or
o by electing to receive income payments.

Your beneficiary can have access to the money in your contract when a death
benefit is paid.

When you make a complete withdrawal you will receive:

1. the value of the contract on the day you made the withdrawal;

2. less any premium tax;

3. less any contract maintenance charge; and

4. less any withdrawal charge.

Except in connection with the systematic withdrawal program, you must withdraw
at least $500 or, if less, the entire amount in the guaranteed account or
investment portfolio from which you are making the withdrawal. After your
withdrawal, you must have at least $100 left in the guaranteed account or
investment portfolio.

Income taxes, tax penalties and certain restrictions may apply to any withdrawal
you make.

There are limitations on withdrawals from a qualified plan referred to as a
403(b) annuity. See "Taxes."

Systematic Withdrawal Program. You can arrange to have money automatically sent
to you periodically while your contract is still in the accumulation phase. You
will have to pay taxes on money you receive and withdrawals you make before you
reach 59 1/2 may be subject to a 10% tax penalty.

We reserve the right to charge a fee for participation or to discontinue
offering this program in the future.

Suspension of Withdrawals or Transfers. Jackson National NY may be required to
suspend or delay withdrawals or transfers from an investment portfolio when:

o the New York Stock Exchange is closed (other than customary weekend and
holiday closings); o trading on the New York Stock Exchange is restricted;
o an emergency exists so that it is not reasonably practicable to dispose of
shares of the investment portfolios or determine investment portfolio
values; o the SEC, by order, may permit for the protection of owners.

Jackson National NY has reserved the right to defer payment for a withdrawal or
transfer from the guaranteed accounts for the period permitted by law, but not
more than six months.

INCOME PAYMENTS (THE INCOME PHASE)

The income phase occurs when you begin receiving regular payments from your
contract. The income date is the month and year in which those payments begin.
The income date must be at least one year after your contract is issued. You can
choose the income date and an income option. The income options are described
below.

If you do not choose an income option, we will assume that you selected Option 3
which provides a life annuity with 120 months of guaranteed payments.

You can change the income date or income option at any time before the income
date. You must give us 7 days notice. Income payments must begin by your 90th
birthday under a non-qualified contract (or an earlier date under a qualified
contract if required by law).

At the income date, you can choose whether payments will come from the
guaranteed accounts, the investment portfolios or both. Unless you tell us
otherwise, your income payments will be based on the investment allocations that
were in place on the income date.

You can choose to have income payments made monthly, quarterly, semi-annually,
or annually. However, if you have less than $2,000 to apply toward an income
option and state law permits, Jackson National NY may provide your payment in a
single lump sum. Likewise, if your first income payment would be less than $20
and state law permits, Jackson National NY may set the frequency of payments so
that the first payment would be at least $20.

Income Payments from Investment Portfolios. If you choose to have any portion of
your income payments come from the investment portfolio(s), the dollar amount of
your payment will depend upon three things:

1. the value of your contract in the investment portfolio(s) on the
income date;

2. the 3% assumed investment rate used in the annuity table for the
contract; and

3. the performance of the investment portfolios you selected.

Jackson National NY calculates the dollar amount of the first income payment
that you receive from the investment portfolios. We then use that amount to
determine the number of annuity units that you hold in each investment
portfolio. The amount of each subsequent income payment is determined by
multiplying the number of annuity units that you hold in an investment portfolio
by the annuity unit value for that investment portfolio.

The number of annuity units that you hold in each investment portfolio does not
change unless you reallocate your contract value among the investment
portfolios. The annuity unit value of each investment portfolio will vary based
on the investment performance of the series. If the actual investment
performance exactly matches the assumed rate at all times, the amount of each
income payment will remain equal. If the actual investment performance exceeds
the assumed rate, your income payments will increase. Similarly, if the actual
investment performance is less than the assumed rate, your income payments will
decrease.

Income Options. The annuitant is the person whose life we look to when we make
income payments. (Each description assumes that you are the owner and
annuitant.)

Option 1 - Life Income. This income option provides monthly payments for
your life.

Option 2 - Joint and Survivor Annuity. This income option provides monthly
payments for your life and for the life of another person (usually your spouse)
selected by you.

Option 3 - Life Annuity With 120 or 240 Monthly Payments Guaranteed. This
income option provides monthly payments for your life, but with payments
continuing to your beneficiary for the remainder of 10 or 20 years (as you
select) if you die before the end of the selected period.

Option 4 - Income for a Specified Period. This income option provides
monthly payments for any number of years from 5 to 30.

Additional Options - Other income options may be made available by Jackson
National NY.

If you choose Option 1, 2 or 3, you cannot make a withdrawal during the income
phase.

DEATH BENEFIT

Death of Owner Before the Income Date. If you die before moving to the income
phase, the person you have chosen as your beneficiary will receive a death
benefit. If you have a joint owner, the death benefit will be paid when the
first joint owner dies and the surviving joint owner will be treated as the
beneficiary. Any other beneficiary designated will be treated as a contingent
beneficiary.

The death benefit equals:

1. current contract value or

2. the total premiums (less withdrawals, withdrawal charges and premium
taxes) or

3. the contract value at the end of the 7th contract year PLUS all
premiums made since the 7th year (less withdrawals, withdrawal charges
and premium taxes)

- -- whichever is GREATEST.

The death benefit under 3 will never exceed 250% of premiums paid, less partial
withdrawals.

The entire death benefit must be paid within 5 years of the date of death unless
the beneficiary elects to have the death benefit payable under an income option.
The death benefit payable under an income option must be paid over the
beneficiary's lifetime or for a period not extending beyond the beneficiary's
life expectancy. Payments must begin within one year of the date of death.
Unless the beneficiary chooses to receive the death benefit in a single sum, the
beneficiary must elect an income option within the 60 day period beginning with
the date Jackson National NY receives proof of death. If the beneficiary chooses
to receive the death benefit in a single sum and all the necessary requirements
are met, Jackson National NY will pay the death benefit within 7 days. If the
beneficiary is your spouse, he/she can continue the contract in his/her own name
at the then current contract value.

Death of Owner After the Income Date. If you or a joint owner die after moving
to the income phase, any remaining payments under the income option elected will
continue at least as rapidly as under the method of distribution in effect at
the date of death.

Death of Annuitant. If the annuitant is not an owner or joint owner and the
annuitant dies before the income date, you can name a new annuitant. If you do
not name a new annuitant within 30 days of the death of the annuitant, you will
become the annuitant. However, if the owner is a non-natural person (for
example, a corporation), then the death of the annuitant will be treated as the
death of the owner, and a new annuitant may not be named.

If the annuitant dies after the income date, the death benefit, if any, will be
as provided for in the income option selected. Death benefits will be paid at
least as rapidly as under the method of distribution in effect at the
annuitant's death.

TAXES

The following is general information and is not intended as tax advice to any
individual. You should consult your own tax adviser.

The Internal Revenue Code (Code) provides that you will not be taxed on the
earnings on the money held in your contract until you take money out (this is
referred to as tax - deferral). There are different rules as to how you will be
taxed depending on how you take the money out and the type of contract you have
(non-qualified or qualified).

Non-Qualified Contracts - General Taxation. You will not be taxed on increases
in the value of your contract until a distribution (either as a withdrawal or as
an income payment) occurs. When you make a withdrawal you are taxed on the
amount of the withdrawal that is earnings. For income payments, a portion of
each income payment is treated as a partial return of your premium and will not
be taxed. The remaining portion of the income payment will be treated as
ordinary income. How the income payment is divided between taxable and
non-taxable portions depends on the period over which income payments are
expected to be made. Income payments received after you have received all of
your premium are treated as income.

If a non-qualified contract is owned by a non-natural person (e.g., corporation
or certain other entities other than tax-qualified trusts), the contract will
generally not be treated as an annuity for tax purposes.

Qualified and Non-Qualified Contracts. If you purchase the contract as an
individual and not under any pension plan, specially sponsored program or an
individual retirement annuity, your contract is referred to as a non-qualified
contract.

If you purchase the contract under a pension plan, specially sponsored program,
or an individual retirement annuity, your contract is referred to as a qualified
contract. Examples of qualified plans are: Individual Retirement Annuities
(IRAs), Tax-Sheltered Annuities (sometimes referred to as 403(b) contracts),
H.R. 10 Plans (sometimes referred to as Keogh Plans), and pension and
profit-sharing plans, which include 401(k) plans.

Withdrawals - Non-Qualified Contracts. If you make a withdrawal from your
contract, the Code treats the withdrawal as first coming from earnings and then
from your premium payments. Withdrawn earnings are includible in income.

The Code also provides that any amount received under an annuity contract which
is included in income may be subject to a 10% penalty. Some withdrawals will be
exempt from the penalty. They include any amounts: (1) paid on or after the
taxpayer reaches age 59 1/2; (2) paid after you die; (3) paid if the taxpayer
becomes totally disabled (as that term is defined in the Code); (4) paid in a
series of substantially equal payments made annually (or more frequently) under
a lifetime annuity; (5) paid under an immediate annuity; or (6) which come from
premiums made prior to August 14, 1982.

Withdrawals - Qualified Contracts. There are special rules that govern qualified
contracts. We have provided additional discussion in the Statement of Additional
Information.

Withdrawals - Tax-Sheltered Annuities. The Code limits the withdrawal of
premiums from certain Tax-Sheltered Annuities. Withdrawals can only be made when
an owner: (1) reaches age 59 1/2; (2) leaves his/her job; (3) dies; (4) becomes
disabled (as that term is defined in the Code); or (5) in the case of hardship.
However, in the case of hardship, the owner can only withdraw the premium and
not any earnings.

Withdrawals - Roth IRAs. Beginning in 1998, individuals may purchase a new type
of non-deductible IRA, known as a Roth IRA. Qualified distributions from Roth
IRAs are entirely tax free. A qualified distribution requires that the
individual has held the Roth IRA for at least five years and, in addition, that
the distribution is made either after the individual reaches age 59 1/2, on
account of the individual's death or disability, or as qualified first-time home
purchase, subject to $10,000 lifetime maximum, for the individual, or for a
spouse, child, grandchild, or ancestor.

Withdrawals - Investment Adviser Fees. The Internal Revenue Service has, through
a series of Private Letter Rulings, held that the payment of investment adviser
fees from an IRA or a Tax-Sheltered Annuity is permissible under certain
circumstances and will not be considered a distribution for income tax purposes.
The Rulings require that in order to receive this favorable tax treatment, the
annuity contract must, under a written agreement, be solely liable (not jointly
with the contract owner) for payment of the adviser's fee and the fee must
actually be paid from the annuity contract to the adviser. Withdrawals from
non-qualified contracts for the payment of investment adviser fees will be
considered distributions from the contract.

Assignment. An assignment may be a taxable event. If the contract is issued
pursuant to a qualified plan, there may be limitations on your ability to assign
the contract.

Diversification. The Code provides that the underlying investments for a
variable annuity must satisfy certain diversification requirements in order to
be treated as an annuity contract. Jackson National NY believes that the
underlying investments are being managed so as to comply with these
requirements.

Neither the Code nor the Internal Revenue Service Regulations issued to date
provide guidance as to the circumstances under which you, because of the degree
of control you exercise over the underlying investments, and not Jackson
National NY would be considered the owner of the shares of the investment
portfolios. If this occurs, it will result in the loss of the favorable tax
treatment for the contract.

It is unknown to what extent owners are permitted to select investment
portfolios, to make transfers among the investment portfolios or the number and
type of investment portfolios from which owners may select. If any guidance is
provided which is considered a new position, then the guidance would generally
be applied prospectively. However, if such guidance is considered not to be a
new position, it may be applied retroactively. This would mean that you, as the
owner of the contract, could be treated as the owner of the investment
portfolios. Due to the uncertainty in this area, Jackson National NY reserves
the right to modify the contract in an attempt to maintain favorable tax
treatment.

OTHER INFORMATION

Dollar Cost Averaging. You can arrange to automatically have a regular amount of
money periodically transferred into the investment portfolios. This
theoretically gives you a lower average cost per unit over time than you would
receive if you made a one time purchase.

To participate in this program, you must have a total contract value of at least
$15,000 (unless we waive this requirement). Certain other restrictions may
apply.

Jackson National NY does not currently charge for participation in this program.
We may do so in the future.

Rebalancing. You can arrange to have Jackson National NY automatically
reallocate money between investment portfolios periodically to keep the blend
you select.

Jackson National NY does not currently charge for participation in this program.
We may do so in the future.

Free Look. You may return your contract to the selling agent or to Jackson
National NY within twenty days after receiving it. Jackson National NY will
return the contract value in the investment portfolios plus any fees and
expenses deducted from the premium allocated to the investment portfolios plus
the full amount of premium you allocated to the guaranteed accounts. We will
determine the contract value in the investment portfolios as of the date you
mail the contract to us or the date you return it to the selling agent. Jackson
National NY will return premium payments where required by law.

Advertising. From time to time, Jackson National NY may advertise several types
of performance for the investment portfolios.

o Total return is the overall change in the value of an investment in an
investment portfolio over a given period of time.
o Standardized average annual total return is calculated in accordance with
SEC guidelines.
o Non-standardized total return may be for periods other than those required
or may otherwise differ from standardized average annual total return. For
example, if a series has been in existence longer than the investment
portfolio, we may show non-standardized performance for periods that begin
on the inception date of the series, rather than the inception date of the
investment portfolio.
o Yield refers to the income generated by an investment over a given period
of time.

Performance will be calculated by determining the percentage change in the value
of an accumulation unit by dividing the increase (decrease) for that unit by the
value of the accumulation unit at the beginning of the period. Performance will
reflect the deduction of the insurance charges and may reflect the deduction of
the contract maintenance charge and withdrawal charge. The deduction of the
contract maintenance and/or the withdrawal charge would reduce the percentage
increase or make greater any percentage decrease.

Market Timing and Asset Allocation Services. Market timing and asset allocation
services offered by third parties must comply with Jackson National NY's
administrative systems, rules and procedures.

Modification of the Contract. Only the President, Vice President, Secretary or
Assistant Secretary of Jackson National NY may approve a change to or waive a
provision of the contract. Any change or waiver must be in writing. Jackson
National NY may change the terms of the contract in order to comply with changes
in applicable law, or otherwise as deemed necessary by Jackson National NY.

Year 2000 Matters. Jackson National NY has initiated a project to review and
analyze its computer systems to determine if they are Year 2000 compatible. This
project includes a process which ensures that when a particular system, or
software application, is determined to be "non-compliant" the proper steps are
in place to either remedy the "non-compliance" or cease using the particular
system or software.

Jackson National NY's project provides for an inventory of all critical computer
systems, testing of such systems and resolution of Year 2000 issues. Jackson
National NY anticipates that all compliance issues will be resolved by December
31, 1999.

As of the date of this Prospectus, Jackson National NY has identified and made
available what it believes are the appropriate resources of hardware, people,
and dollars to ensure that the plan will be completed.

Jackson National NY will not conclusively know the success of its plan until the
Year 2000. Even with appropriate and diligent pursuit of a well-conceived
response plan, including testing procedures, there is no certainty that any
company will achieve complete success. Further, Jackson National NY's ability to
function unaffected to and through the Year 2000 may be adversely affected by
actions (or inactions) of third parties beyond its knowledge or control.

Legal Proceedings. There are no material legal proceedings, other than ordinary
routine litigation incidental to the business, to which Jackson National Life
Insurance Company of New York, Jackson National Life Distributors, Inc., and the
JNLNY Separate Account I are parties.

Questions. If you have questions about your contract, you may call or write to
us at:

o Jackson National Life NY Annuity Service Center: (800) 599-5651, P.O. Box
0809, Denver, Colorado 80263-0809
o Institutional Marketing Group Service Center: (800) 777-7779, P.O. Box
30386, Lansing, Michigan 48909-9692.

<PAGE>

TABLE OF CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION

General Information and History ............................................. 2

Services .................................................................... 2

Purchase of Securities Being Offered ........................................ 2

Underwriters ................................................................ 2

Calculation of Performance .................................................. 3

Additional Tax Information .................................................. 6

Income Payments; Net Investment Factor ......................................15

Financial Statements ........................................................17
<PAGE>
1

STATEMENT OF ADDITIONAL INFORMATION

January 4, 1999

INDIVIDUAL DEFERRED FIXED AND VARIABLE ANNUITY CONTRACTS
ISSUED BY THE JNLNY SEPARATE ACCOUNT I
OF JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK

This Statement of Additional Information is not a prospectus. It
contains information in addition to and more detailed than set forth in the
Prospectus and should be read in conjunction with the Prospectus dated January
4, 1999. The Prospectus may be obtained from Jackson National Life Insurance
Company of New York by writing P.O. Box 378002, Denver, Colorado 80237-8002, or
calling 1-800-599-5651.

TABLE OF CONTENTS
Page

General Information and History............................................2
Services...................................................................2
Purchase of Securities Being Offered.......................................2
Underwriters...............................................................2
Calculation of Performance.................................................3
Additional Tax Information.................................................6
Income Payments; Net Investment Factor ...................................15
Financial Statements .....................................................17

<PAGE>

General Information and History

JNLNY Separate Account I (Separate Account) is a separate investment
account of Jackson National Life Insurance Company of New York (Jackson National
NY). In September 1997, the company changed its name from First Jackson National
Life Insurance Company to its present name. Jackson National NY is a
wholly-owned subsidiary of Jackson National Life Insurance Company, and is
ultimately a wholly-owned subsidiary of Prudential Corporation plc, London,
England, a life insurance company in the United Kingdom.

Services

Jackson National NY has responsibility for administration of the
contracts and the Separate Account. We maintain records of the name, address,
taxpayer identification number and other pertinent information for each contract
owner and the number and type of contracts issued to each contract owner, and
records with respect to the value of each contract.

Jackson National NY is also the custodian of the assets of the Separate
Account.

PricewaterhouseCoopers LLP, 200 East Randolph Drive, Chicago, Illinois
60601, audits and reports on Jackson National NY's financial statements,
including the financial statements of the Separate Account, and performs other
professional accounting, auditing and advisory services when engaged to do so by
Jackson National NY.

Blazzard, Grodd & Hasenauer, P.C. of Westport, Connecticut has provided
advice on certain matters relating to the federal securities and income tax laws
in connection with the contracts described in the Prospectus.

Purchase of Securities Being Offered

The contracts will be sold by licensed insurance agents in states where
the contracts may be lawfully sold. The agents will be registered
representatives of broker-dealers that are registered under the Securities
Exchange Act of 1934 and members of the National Association of Securities
Dealers, Inc. (NASD).

Underwriters

The contracts are offered continuously and are distributed by Jackson
National Life Distributors, Inc. (JNLD), 10877 Wilshire Boulevard, Suite 1550,
Los Angeles, California 90024. JNLD is a subsidiary of Jackson National Life
Insurance Company.

<PAGE>

Calculation of Performance

When Jackson National NY advertises performance for an investment
portfolio (except the PPM America/JNL Money Market Portfolio), we will include
quotations of standardized average annual total return to facilitate comparison
with standardized average annual total return advertised by other variable
annuity separate accounts. Standardized average annual total return for an
investment portfolio will be shown for periods beginning on the date the
investment portfolio first invested in the corresponding series. We will
calculate standardized average annual total return according to the standard
methods prescribed by rules of the Securities and Exchange Commission.

Standardized average annual total return for a specific period is
calculated by taking a hypothetical $1,000 investment in an investment portfolio
at the offering on the first day of the period ("initial investment"), and
computing the ending redeemable value ("redeemable value") of that investment at
the end of the period. The redeemable value is then divided by the initial
investment and expressed as a percentage, carried to at least the nearest
hundredth of a percent. Standardized average annual total return is annualized
and reflects the deduction of the insurance charges and the contract maintenance
charge. The redeemable value also reflects the effect of any applicable
withdrawal charge that may be imposed at the end of the period. No deduction is
made for premium taxes which may be assessed by certain states.

Jackson National NY may also advertise non-standardized total return.
Non-standardized total return may be for periods other than those required to be
presented or may otherwise differ from standardized average annual total return.
Because the contract is designed for long term investment, non-standardized
total return that does not reflect the deduction of any applicable withdrawal
charge may be advertised. Reflecting the deduction of the withdrawal charge
decreases the level of performance advertised. Non-standardized total return may
also assume a larger initial investment which more closely approximates the size
of a typical contract.

The non-standardized average annual total returns that each investment
portfolio (except the PPM America/JNL Money Market Portfolio) would have
achieved if it had been invested in the corresponding series for the periods
indicated, calculated in a manner similar to standardized average annual total
return but assuming a hypothetical initial investment of $10,000 and without
deducting the withdrawal charge, are as follows: (NOTE: The figures below
present investment performance information for the periods ended June 30, 1998.
While these numbers represent the returns as of that date, they do not represent
performance information of the investment portfolios since that date.
Performance information for periods after June 30, 1998 may be significantly
different (lower) than the numbers shown below.)

Commencement of
Operations of
One Year Period Corresponding
Ended Series to
June 30, 1998 June 30, 1998
------------- -------------
<S> <C> <C>
JNL/Alger Growth Portfolio** 33.39% 21.55%
JNL/Eagle Core Equity Portfolio*** 21.50% 26.33%
JNL/Eagle SmallCap Equity Portfolio*** 16.74% 28.10%
JNL/Janus Aggressive Growth Portfolio* 36.10% 26.08%
JNL/Janus Capital Growth Portfolio* 26.87% 24.87%
JNL/Janus Global Equities Portfolio* 26.33% 33.16%
JNL/Putnam Growth Portfolio* 35.16% 30.65%
JNL/Putnam Value Equity Portfolio* 14.35% 23.29%
JNL/S&P Conservative Growth Portfolio I**** N/A 0.18%
JNL/S&P Moderate Growth Portfolio I**** N/A 1.08%
JNL/S&P Aggressive Growth Portfolio I**** N/A 1.97%
JNL/S&P Very Aggressive Growth Portfolio I**** N/A 3.04%
JNL/S&P Equity Growth Portfolio I**** N/A -0.60%
JNL/S&P Equity Aggressive Growth Portfolio I**** N/A 0.41%
PPM America/JNL Balanced Portfolio* 15.26% 15.36%
PPM America/JNL High Yield Bond Portfolio* 11.84% 11.02%
Salomon Brothers/JNL Global Bond Portfolio* 6.08% 9.54%
Salomon Brothers/JNL U.S. Government & Quality
Bond Portfolio* 9.10% 5.68%
T. Rowe Price/JNL Established Growth Portfolio* 27.26% 27.92%
T. Rowe Price/JNL International Equity Investment Portfolio* 2.94% 10.35%
T. Rowe Price/JNL Mid-Cap Growth Portfolio* 28.13% 26.73%
</TABLE>

* Corresponding series commenced operations on May 15, 1995.
** Corresponding series commenced operations on October 16, 1995.
*** Corresponding series commenced operations on September 16, 1996.
**** The JNL/S&P Conservative Growth Series I commenced operations on April 9,
1998; the JNL/S&P Moderate Growth Series I commenced operations on April 8,
1998; the JNL/S&P Aggressive Growth Series I commenced operations on April 8,
1998; the JNL/S&P Very Aggressive Growth Series I commenced operations on April
1, 1998; the JNL/S&P Equity Growth Series I commenced operations on April 13,
1998; and the JNL/S&P Equity Aggressive Growth Series I commenced operations on
April 15, 1998. Performance figures are not annualized.

Prior to May 1, 1997, the PPM America/JNL Balanced Portfolio was the
JNL/Phoenix Investment Counsel Balanced Portfolio and the corresponding series
was sub-advised by Phoenix Investment Counsel, Inc., the JNL/Putnam Growth
Portfolio was the JNL/Phoenix Investment Counsel Growth Portfolio and the
corresponding series was sub-advised by Phoenix Investment Counsel, Inc., and
the JNL/Phoenix Value Equity Portfolio was the PPM America/JNL Value Equity
Portfolio and the corresponding series was sub-advised by PPM America, Inc.

Standardized average annual total return quotations will be current to
the last day of the calendar quarter preceding the date on which an
advertisement is submitted for publication. Both standardized average annual
total return quotations and non-standardized total return quotations will be
based on rolling calendar quarters and will cover at least periods of one, five,
and ten years, or a period covering the time the investment portfolio has been
in existence, if it has not been in existence for one of the prescribed periods.
If the corresponding series has been in existence for longer than the investment
portfolio, the non-standardized total return quotations will show the investment
performance the investment portfolio would have achieved (reduced by the
applicable charges) had it been held in the series for the period quoted.
Standardized average annual total return is not available for periods before the
investment portfolio was in existence.

Quotations of standardized average annual total return and
non-standardized total return are based upon historical earnings and will
fluctuate. Any quotation of performance should not be considered a guarantee of
future performance. Factors affecting the performance of a series include
general market conditions, operating expenses and investment management. An
owner's withdrawal value upon surrender of a contract may be more or less than
original cost.

Jackson National NY may advertise the current annualized yield for a
30-day period for an investment portfolio. The annualized yield of an investment
portfolio refers to the income generated by the investment portfolio over a
specified 30-day period. Because this yield is annualized, the yield generated
by an investment portfolio during the 30-day period is assumed to be generated
each 30-day period. The yield is computed by dividing the net investment income
per accumulation unit earned during the period by the price per unit on the last
day of the period, according to the following formula:

a-b 6
YIELD = 2[(---+1) -1]
cd

Where:

a = net investment income earned during the
period by the Series attributable to shares
owned by the investment portfolio.
b = expenses for the investment portfolio
accrued for the period (net of
reimbursements).
c = the average daily number of accumulation
units outstanding during the period.
d = the maximum offering price per
accumulation unit on the last day of the
period.

Net investment income will be determined in accordance with rules
established by the Securities and Exchange Commission. Accrued expenses will
include all recurring fees that are charged to all contracts.

Because of the charges and deductions imposed by the Separate Account,
the yield for an investment portfolio will be lower than the yield for the
corresponding series. The yield on amounts held in the investment portfolios
normally will fluctuate over time. Therefore, the disclosed yield for any given
period is not an indication or representation of future yields or rates of
return. An investment portfolio's actual yield will be affected by the types and
quality of portfolio securities held by the series and the series operating
expenses.

Any current yield quotations of the PPM America/JNL Money Market
Portfolio, subject to Rule 482 of the Securities Act of 1933, will consist of a
seven calendar day historical yield, carried at least to the nearest hundredth
of a percent. We may advertise yield for the Portfolio based on different time
periods, but we will accompany it with a yield quotation based on a seven day
calendar period. The PPM America/JNL Money Market Portfolio's yield will be
calculated by determining the net change, exclusive of capital changes, in the
value of a hypothetical pre-existing account having a balance of one
accumulation unit at the beginning of the base period, subtracting a
hypothetical charge reflecting deductions from contracts, and dividing the net
change in account value by the value of the account at the beginning of the
period to obtain a base period return and multiplying the base period return by
(365/7). The PPM America/JNL Money Market Portfolio's effective yield is
computed similarly but includes the effect of assumed compounding on an
annualized basis of the current yield quotations of the Portfolio.

The PPM America/JNL Money Market Portfolio's yield and effective yield
will fluctuate daily. Actual yields will depend on factors such as the type of
instruments in the series' portfolio, portfolio quality and average maturity,
changes in interest rates, and the series' expenses. Although the investment
portfolio determines its yield on the basis of a seven calendar day period, it
may use a different time period on occasion. The yield quotes may reflect the
expense limitations described in the series' Prospectus or Statement of
Additional Information. There is no assurance that the yields quoted on any
given occasion will be maintained for any period of time and there is no
guarantee that the net asset values will remain constant. It should be noted
that neither a contract owner's investment in the PPM America/JNL Money Market
Portfolio nor that Portfolio's investment in the PPM America/JNL Money Market
Series, is guaranteed or insured. Yields of other money market funds may not be
comparable if a different base or another method of calculation is used.

Additional Tax Information

NOTE: INFORMATION CONTAINED HEREIN SHOULD NOT BE SUBSTITUTED FOR THE
ADVICE OF A PERSONAL TAX ADVISER. JACKSON NATIONAL NY DOES NOT MAKE ANY
GUARANTEE REGARDING THE TAX STATUS OF ANY CONTRACT OR ANY TRANSACTION INVOLVING
THE CONTRACTS. PURCHASERS BEAR THE COMPLETE RISK THAT THE CONTRACTS MAY NOT BE
TREATED AS "ANNUITY CONTRACTS" UNDER FEDERAL INCOME TAX LAWS. IT SHOULD BE
FURTHER UNDERSTOOD THAT THE FOLLOWING DISCUSSION IS NOT EXHAUSTIVE AND THAT
SPECIAL RULES NOT DESCRIBED IN THIS PROSPECTUS MAY BE APPLICABLE IN CERTAIN
SITUATIONS. MOREOVER, NO ATTEMPT HAS BEEN MADE TO CONSIDER ANY APPLICABLE STATE
OR OTHER TAX LAWS.

General

Section 72 of the Internal Revenue Code of 1986, as amended (the
"Code"), governs taxation of annuities in general. An individual owner is not
taxed on increases in the value of a contract until distribution occurs, either
in the form of a withdrawal or as annuity payments under the annuity option
elected. For a withdrawal received as a total surrender (total redemption or a
death benefit), the recipient is taxed on the portion of the payment that
exceeds the cost basis of the contract. For a payment received as a partial
withdrawal, federal tax liability is determined on a last-in, first-out basis,
meaning taxable income is withdrawn before the cost basis of the contract is
withdrawn. For contracts issued in connection with non-qualified plans, the cost
basis is generally the premiums, while for contracts issued in connection with
qualified plans there may be no cost basis. The taxable portion of a withdrawal
is taxed at ordinary income tax rates. Tax penalties may also apply.

For annuity payments, a portion of each payment in excess of an
exclusion amount is includable in taxable income. The exclusion amount for
payments based on a fixed annuity option is determined by multiplying the
payment by the ratio that the cost basis of the contract (adjusted for any
period certain or refund feature) bears to the expected return under the
contract. The exclusion amount for payments based on a variable annuity option
is determined by dividing the cost basis of the contract (adjusted for any
period certain or refund guarantee) by the number of years over which the
annuity is expected to be paid. Payments received after the investment in the
contract has been recovered (i.e. when the total of the excludable amounts
equals the investment in the contract) are fully taxable. The taxable portion is
taxed at ordinary income tax rates. For certain types of qualified plans there
may be no cost basis in the contract within the meaning of Section 72 of the
Code. Owners, annuitants and beneficiaries under the contracts should seek
competent financial advice about the tax consequences of distributions.

Jackson National NY is taxed as a life insurance company under the
Code. For federal income tax purposes, the Separate Account is not a separate
entity from Jackson National NY and its operations form a part of Jackson
National NY.

Withholding Tax on Distributions

The Code generally requires Jackson National NY (or, in some cases, a
plan administrator) to withhold tax on the taxable portion of any distribution
or withdrawal from a contract. For "eligible rollover distributions" from
contracts issued under certain types of qualified plans, 20% of the distribution
must be withheld, unless the payee elects to have the distribution "rolled over"
to another eligible plan in a direct transfer. This requirement is mandatory and
cannot be waived by the owner.

An "eligible rollover distribution" is the estimated taxable portion of
any amount received by a covered employee from a plan qualified under Section
401(a) or 403(a) of the Code, or from a tax sheltered annuity qualified under
Section 403(b) of the Code (other than (1) a series of substantially equal
annuity payments for the life (or life expectancy) of the employee, or joint
lives (or joint life expectancies) of the employee, and his or her designated
beneficiary, or for a specified period of ten years or more; and (2) minimum
distributions required to be made under the Code). Failure to "rollover" the
entire amount of an eligible rollover distribution (including an amount equal to
the 20% portion of the distribution that was withheld) could have adverse tax
consequences, including the imposition of a penalty tax on premature
withdrawals, described later in this section.

Withdrawals or distributions from a contract other than eligible
rollover distributions are also subject to withholding on the estimated taxable
portion of the distribution, but the owner may elect in such cases to waive the
withholding requirement. If not waived, withholding is imposed (1) for periodic
payments, at the rate that would be imposed if the payments were wages, or (2)
for other distributions, at the rate of 10%. If no withholding exemption
certificate is in effect for the payee, the rate under (1) above is computed by
treating the payee as a married individual claiming 3 withholding exemptions.

Generally, the amount of any payment of interest to a non-resident
alien of the United States shall be subject to withholding of a tax equal to
thirty (30%) percent of such amount or, if applicable, a lower treaty rate. A
payment may not be subject to withholding where the recipient sufficiently
establishes that such payment is effectively connected to the recipient's
conduct of a trade or business in the United States and such payment is included
in recipient's gross income.

Diversification -- Separate Account Investments

Section 817(h) of the Code imposes certain diversification standards on
the underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not adequately
diversified, in accordance with regulations prescribed by the United States
Treasury Department ("Treasury Department"). Disqualification of the contract as
an annuity contract would result in imposition of federal income tax to the
owner with respect to earnings allocable to the contract prior to the receipt of
payments under the contract. The Code contains a safe harbor provision which
provides that annuity contracts such as the contracts meet the diversification
requirements if, as of the close of each calendar quarter, the underlying assets
meet the diversification standards for a regulated investment company, and no
more than 55% of the total assets consist of cash, cash items, U.S. government
securities and securities of other regulated investment companies.

The Treasury Department has issued Regulations establishing
diversification requirements for the investment portfolios underlying variable
contracts. The Regulations amplify the diversification requirements for variable
contracts set forth in the Code and provide an alternative to the safe harbor
provision described above. Under the Regulations, an investment portfolio will
be deemed adequately diversified if (1) no more than 55% of the value of the
total assets of the portfolio is represented by any one investment; (2) no more
than 70% of the value of the total assets of the portfolio is represented by any
two investments; (3) no more than 80% of the value of the total assets of the
portfolio is represented by any three investments; and (4) no more than 90% of
the value of the total assets of the portfolio is represented by any four
investments.

Jackson National NY intends that each series of the JNL Series Trust
will be managed by its respective investment adviser in such a manner as to
comply with these diversification requirements.

The Treasury Department has indicated that the diversification
Regulations do not provide guidance regarding the circumstances in which
contract owner control of the investments of the Separate Account will cause the
contract owner to be treated as the owner of the assets of the Separate Account,
thereby resulting in the loss of favorable tax treatment of the contract. At
this time it cannot be determined whether additional guidance will be provided
and what standards may be contained in such guidance.

The amount of owner control which may be exercised under the contract
is different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the owner's ability to transfer among
investment choices or the number and type of investment choices available, would
cause the owner to be considered as the owner of the assets of the Separate
Account resulting in the imposition of federal income tax to the owner with
respect to earnings allocable to the contract prior to receipt of payments under
the contract.

In the event any forthcoming guidance or ruling is considered to set
forth a new position, such guidance or ruling will generally be applied only
prospectively. However, if such ruling or guidance was not considered to set
forth a new position, it may be applied retroactively resulting in the owner
being retroactively determined to be the owner of the assets of the Separate
Account.

Due to the uncertainty in this area, Jackson National NY reserves the
right to modify the contract in an attempt to maintain favorable tax treatment.

Multiple Contracts

The Code provides that multiple annuity contracts which are issued
within a calendar year to the same contract owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences including more rapid taxation of the distributed amounts from such
multiple contracts. Owners should consult a tax adviser prior to purchasing more
than one annuity contract in any calendar year.

Contracts Owned by Other than Natural Persons

Under Section 72(u) of the Code, the investment earnings on premiums
for contracts will be taxed currently to the owner if the owner is a non-natural
person, e.g., a corporation or certain other entities. Such contracts generally
will not be treated as annuities for federal income tax purposes. However, this
treatment is not applied to contracts held by a trust or other entity as an
agent for a natural person nor to contracts held by certain qualified plans.
Purchasers should consult their own tax counsel or other tax adviser before
purchasing a contract to be owned by a non-natural person.

Tax Treatment of Assignments

An assignment or pledge of a contract may have tax consequences, and
may also be prohibited by ERISA in some circumstances. Owners should, therefore,
consult competent legal advisers should they wish to assign or pledge their
contracts.

Qualified Plans

The contracts offered by the Prospectus are designed to be suitable for
use under various types of qualified plans. Taxation of owners in each qualified
plan varies with the type of plan and terms and conditions of each specific
plan. Owners, annuitants and beneficiaries are cautioned that benefits under a
qualified plan may be subject to the terms and conditions of the plan,
regardless of the terms and conditions of the contracts issued to fund the plan.

Tax Treatment of Withdrawals

Non-Qualified Plans
- -------------------

Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the contract value exceeds the aggregate Premiums
made, any amount withdrawn not in the form of an annuity payment will be treated
as coming first from the earnings and then, only after the income portion is
exhausted, as coming from the principal. Withdrawn earnings are included in a
taxpayer's gross income. Section 72 further provides that a 10% penalty will
apply to the income portion of any distribution. The penalty is not imposed on
amounts received: (1) after the taxpayer reaches 59 1/2; (2) upon the death of
the owner; (3) if the taxpayer is totally disabled as defined in Section
72(m)(7) of the Code; (4) in a series of substantially equal periodic payments
made at least annually for the life (or life expectancy) of the taxpayer or for
the joint lives (or joint life expectancies) of the taxpayer and his
beneficiary; (5) under an immediate annuity; or (6) which are allocable to
premium payments made prior to August 14, 1982.

Qualified Plans
- ---------------

In the case of a withdrawal under a qualified contract, a ratable
portion of the amount received is taxable, generally based on the ratio of the
individual's cost basis to the individual's total accrued benefit under the
retirement plan. Special tax rules may be available for certain distributions
from a qualified contract. Section 72(t) of the Code imposes a 10% penalty tax
on the taxable portion of any distribution from qualified retirement plans,
including contracts issued and qualified under Code Sections 401 (H.R. 10 and
Corporate Pension and Profit Sharing plans), 403(b) (tax-sheltered annuities)
and 408 and 408A (IRAs). To the extent amounts are not included in gross income
because they have been rolled over to an IRA or to another eligible qualified
plan, no tax penalty will be imposed.

The tax penalty will not apply to the following distributions: (1) if
distribution is made on or after the date on which the owner or annuitant (as
applicable) reaches age 59 1/2; (2) distributions following the death or
disability of the owner or annuitant (as applicable) (for this purpose
"disability" is defined in Section 72(m)(7) of the Code); (3) after separation
from service, distributions that are part of substantially equal periodic
payments made not less frequently than annually for the life (or life
expectancy) of the owner or annuitant (as applicable) or the joint lives (or
joint life expectancies) of such owner or annuitant (as applicable) and his or
her designated beneficiary; (4) distributions to an owner or annuitant (as
applicable) who has separated from service after he has attained age 55; (5)
distributions made to the owner or annuitant (as applicable) to the extent such
distributions do not exceed the amount allowable as a deduction under Code
Section 213 to the owner or annuitant (as applicable) for amounts paid during
the taxable year for medical care; (6) distributions made to an alternate payee
pursuant to a qualified domestic relations order; (7) distributions from an IRA
for the purchase of medical insurance (as described in Section 213(d)(1)(D) of
the Code) for the contract owner or annuitant (as applicable) and his or her
spouse and dependents if the contract owner or annuitant (as applicable) has
received unemployment compensation for at least 12 weeks(this exception will no
longer apply after the contract owner or annuitant (as applicable) has been
re-employed for at least 60 days); (8) distributions from an Individual
Retirement Annuity made to the owner or annuitant (as applicable) to the extent
such distributions do not exceed the qualified higher education expenses (as
defined in Section 72(t)(7) of the Code) of the owner or annuitant (as
applicable) for the taxable year; and (9) distributions from an Individual
Retirement Annuity made to the owner or annuitant (as applicable) which are
qualified first-time home buyer distributions (as defined in Section 72(t)(8) of
the Code). The exception stated in items (4) and (6) above do not apply in the
case of an IRA. The exception stated in (3) above applies to an IRA without the
requirement that there be a separation from service.

Withdrawals of amounts attributable to contributions made pursuant to a
salary reduction agreement (in accordance with Section 403(b)(11) of the Code)
are limited to the following: when the owner attains age 59 1/2, separates from
services, dies, becomes disabled (within the meaning of Section 72(m)(7) of the
Code), or in the case of hardship. Hardship withdrawals do not include any
earnings on salary reduction contributions. These limitations on withdrawals
apply to: (1) salary reduction contributions made after December 31, 1988; (2)
income attributable to such contributions; and (3) income attributable to
amounts held as of December 31, 1988. The limitations on withdrawals do not
affect rollovers or exchanges between certain qualified plans. Tax penalties may
also apply. While the foregoing limitations only apply to certain contracts
issued in connection with Section 403(b) qualified plans, all owners should seek
competent tax advice regarding any withdrawals or distributions.

The taxable portion of a withdrawal or distribution from contracts
issued under certain types of plans may, under some circumstances, be "rolled
over" into another eligible plan so as to continue to defer income tax on the
taxable portion. Effective January 1, 1993, such treatment is available for an
"eligible rollover distribution" made by certain types of plans (as described
above under "Taxes -- Withholding Tax on Distributions") that is transferred
within 60 days of receipt into another eligible plan or an IRA, or an individual
retirement account described in section 408(a) of the Code. Plans making such
eligible rollover distributions are also required, with some exceptions
specified in the Code, to provide for a direct transfer of the distribution to
the transferee plan designated by the recipient.

Amounts received from IRAs may also be rolled over into other IRAs,
individual retirement accounts or certain other plans, subject to limitations
set forth in the Code.

Generally, distributions from a qualified plan must commence no later
than April 1 of the calendar year following the year in which the employee
attains the later of age 70 1/2 or the date of retirement. In the case of an
IRA, distribution must commence no later than April 1 of the calendar year
following the year in which the owner attains age 70 1/2. Required distributions
must be over a period not exceeding the life or life expectancy of the
individual or the joint lives or life expectancies of the individual and his or
her designated beneficiary. If the required minimum distributions are not made,
a 50% penalty tax is imposed as to the amount not distributed.

Types of Qualified Plans

The following are general descriptions of the types of qualified plans
with which the contracts may be used. Such descriptions are not exhaustive and
are for general information purposes only. The tax rules regarding qualified
plans are very complex and will have differing applications depending on
individual facts and circumstances. Each purchaser should obtain competent tax
advice prior to purchasing a contract issued under a qualified plan.

Contracts issued pursuant to qualified plans include special provisions
restricting contract provisions that may otherwise be available and described in
this Prospectus. Generally, contracts issued pursuant to qualified plans are not
transferable except upon surrender or annuitization. Various penalty and excise
taxes may apply to contributions or distributions made in violation of
applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from qualified plan contracts.

(a) H.R. 10 Plans

Section 401 of the Code permits self-employed individuals to
establish qualified plans for themselves and their employees, commonly
referred to as "H.R. 10" or "Keogh" Plans. Contributions made to the
plan for the benefit of the employees will not be included in the gross
income of the employees until distributed from the plan. The tax
consequences to owners may vary depending upon the particular plan
design. However, the Code places limitations and restrictions on all
plans on such items as: amounts of allowable contributions; form,
manner and timing of distributions; transferability of benefits;
vesting and non-forfeitability of interests; nondiscrimination in
eligibility and participation; and the tax treatment of distributions,
withdrawals and surrenders. Purchasers of contracts for use with an
H.R. 10 Plan should obtain competent tax advice as to the tax treatment
and suitability of such an investment.

(b) Tax-Sheltered Annuities

Section 403(b) of the Code permits the purchase of
"tax-sheltered annuities" by public schools and certain charitable,
educational and scientific organizations described in Section 501(c)
(3) of the Code. These qualifying employers may make contributions to
the contracts for the benefit of their employees. Such contributions
are not included in the gross income of the employee until the employee
receives distributions from the contract. The amount of contributions
to the tax-sheltered annuity is limited to certain maximums imposed by
the Code. Furthermore, the Code sets forth additional restrictions
governing such items as transferability, distributions,
non-discrimination and withdrawals. Employee loans are not allowed
under these contracts. Any employee should obtain competent tax advice
as to the tax treatment and suitability of such an investment.

Section 408(b) of the Code permits eligible individuals to
contribute to an individual retirement program known as an "Individual
Retirement Annuity" ("IRA"). Under applicable limitations, certain
amounts may be contributed to an IRA which will be deductible from the
individual's gross income. These IRAs are subject to limitations on
eligibility, contributions, transferability and distributions. Sales of
contracts for use with IRAs are subject to special requirements imposed
by the Code, including the requirement that certain informational
disclosure be given to persons desiring to establish an IRA. Purchasers
of contracts to be qualified as IRAs should obtain competent tax advice
as to the tax treatment and suitability of such an investment.

(d) Corporate Pension and Profit-Sharing Plans

Sections 401(a) and 401(k) of the Code permit corporate
employers to establish various types of retirement plans for employees.
These retirement plans may permit the purchase of the contracts to
provide benefits under the plan. Contributions to the plan for the
benefit of employees will not be included in the gross income of the
employee until distributed from the plan. The tax consequences to
owners may vary depending upon the particular plan design. However, the
Code places limitations on all plans on such items as amount of
allowable contributions; form, manner and timing of distributions;
vesting and non-forfeitability of interests; nondiscrimination in
eligibility and participation; and the tax treatment of distributions,
transferability of benefits, withdrawals and surrenders. Purchasers of
contracts for use with corporate pension or profit sharing plans should
obtain competent tax advice as to the tax treatment and suitability of
such an investment.

(e) Non-Qualified Deferred Compensation Plans -- Section 457

Under Section 457 of the Code, governmental and certain other
tax-exempt employers may establish, for the benefit of their employees,
deferred compensation plans which may invest in annuity contracts. The
Code, as in the case of qualified plans, establishes limitations and
restrictions on eligibility, contributions and distributions. Under
these plans, contributions made for the benefit of the employees will
not be included in the employees' gross income until distributed from
the plan.

(f) Roth IRAs

Beginning in 1998, individuals may purchase a new type of
non-deductible IRA, known as a Roth IRA. Purchase payments for a Roth
IRA are limited to a maximum of $2,000 per year. Lower maximum
limitations apply to individuals with adjusted gross incomes between
$95,000 and $110,000 in the case of single taxpayers, between $150,000
and $160,000 in the case of married taxpayers filing joint returns, and
between $0 and $10,000 in the case of married taxpayers filing
separately. An overall $2,000 annual limitation continues to apply to
all of a taxpayer's IRA contributions, including Roth IRAs and non-Roth
IRAs.

Qualified distributions from Roth IRAs are free from federal
income tax. A qualified distribution requires that the individual has
held the Roth IRA for at least five years and, in addition, that the
distribution is made either after the individual reaches age 59 1/2, on
the individual's death or disability, or as a qualified first-time home
purchase, subject to a $10,000 lifetime maximum, for the individual, a
spouse, child, grandchild, or ancestor. Any distribution which is not a
qualified distribution is taxable to the extent of earnings in the
distribution. Distributions are treated as made from contributions
first and therefore no distributions are taxable until distributions
exceed the amount of contributions to the Roth IRA. The 10% penalty tax
and the regular IRA exceptions to the 10% penalty tax apply to taxable
distributions from a Roth IRA.

Amounts may be rolled over from one Roth IRA to another Roth
IRA. Furthermore, an individual may make a rollover contribution from a
non-Roth IRA to a Roth IRA, unless the individual has adjusted gross
income over $100,000 or the individual is a married taxpayer filing a
separate return. The individual must pay tax on any portion of the IRA
being rolled over that represents income or a previously deductible IRA
contribution. However, for rollovers in 1998, the individual may pay
that tax ratably over the four taxable year periods beginning with the
tax year 1998. There are no similar limitations on rollovers from a
Roth IRA to another Roth IRA.

Income Payments; Net Investment Factor

See "Income Payments (The Income Phase)" in the Prospectus.

The net investment factor is an index applied to measure the net
investment performance of an investment portfolio from one valuation date to the
next. Since the net investment factor may be greater or less than or equal to
one, and the factor that offsets the 3% investment rate assumed is slightly less
than one, the value of an annuity unit (which changes with the product of that
factor) and the net investment may increase, decrease or remain the same.

The net investment factor for any investment portfolio for any
valuation period is determined by dividing (a) by (b) and then subtracting (c)
from the result where:

(a) is the net result of:

(1) the net asset value of a series share held in the
investment portfolio determined as of the valuation
date at the end of the valuation period, plus

(2) the per share amount of any dividend or other
distribution declared by the series if the
"ex-dividend" date occurs during the valuation
period, plus or minus

(3) a per share credit or charge with respect to any
taxes paid or reserved for by Jackson National NY
during the valuation period which are determined by
Jackson National NY to be attributable to the
operation of the investment portfolio (no federal
income taxes are applicable under present law);

(b) is the net asset value of the series share held in the
investment portfolio determined as of the valuation date at
the end of the preceding valuation period; and

(c) is the asset charge factor determined by Jackson National NY
for the valuation period to reflect the charges for assuming
the mortality and expense risks and the administration charge.
<PAGE>

Jackson National Life Insurance
Company of New York

[LOGO](R)

Financial Statements

December 31, 1997

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS
---------------------------------

To the Board of Directors and Stockholder of
Jackson National Life Insurance Company of New York

In our opinion, the accompanying balance sheet and the related income statement
and statements of stockholder's equity and of cash flows present fairly, in all
material respects, the financial position of Jackson National Life Insurance
Company of New York (the "Company") (a wholly-owned subsidiary of Jackson
National Life Insurance Company) at December 31, 1997 and 1996, and the results
of its operations and its cash flows for the year ended December 31, 1997, and
for the period May 22, 1996 (commencement of operations) through December 31,
1996, in conformity with generally accepted accounting principles. 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 of these statements in accordance with
generally accepted auditing standards which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.

/s/ Price Waterhouse LLP

February 17, 1998

<PAGE>

Jackson National Life Insurance Company of New York
(a wholly owned subsidiary of Jackson National Life Insurance Company)
Financial Statements

Balance Sheet

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

December 31,
Assets 1997 1996
------------------- ------------------
<S> <C> <C>
Investments:
Fixed maturities available for sale (amortized
cost: 1997, $8,242,773; 1996, $504,794) .... $8,344,128 $500,420
Cash and short-term investments ................ 93,886 7,719,490
---------- ----------

Total investments .......................... 8,438,014 8,219,910

Accrued investment income ...................... 68,991 40,606
Furniture and equipment ........................ 59,643 --
Deferred income taxes .......................... -- 1,531
State tax recoverable .......................... -- 3,500
Federal income tax recoverable ................. 8,393 22,600
---------- ----------

Total assets ............................... 8,575,041
8,288,147
========== ==========

Liabilities
General expenses payable .................... 15,000 1,000
State taxes payable ......................... 4,150 --
Deferred income taxes ....................... 35,474 --
Payable to parent ........................... 108,520 140,102
---------- ----------

Total liabilities ....................... 163,144 141,102
========== ==========

Stockholder's equity
Capital stock, $1,000 par value; 2,000 shares
issued and outstanding .................. 2,000,000 2,000,000
Additional paid-in capital .................. 6,000,000 6,000,000
Net unrealized gain (loss) on investments,
net of tax of $35,474 and $(1,531) ...... 65,881 (2,843)
Retained earnings ........................... 346,016 149,888
---------- ----------

Total stockholder's equity .................. 8,411,897 8,147,045
----------
----------

Total liabilities and stockholder's equity $8,575,041 $8,288,147
========== ==========

</TABLE>

See accompanying financial documents.
<PAGE>

Income Statement

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Year Ended Period Ended
December 31, December 31,
1997 1996 (1)
------------------- -------------------
<S> <C> <C>
Revenues
Net investment income ......................... $ 469,601 $ 263,890
---------- ----------

Total revenues .............................. 469,601 263,890

Benefits and Expenses
General and administrative expenses ........... 116,215 10,000
Taxes, licenses and fees ...................... 51,651 23,102
----------

----------
Total benefits and expenses ................. 167,866 33,102
---------- ----------

Pretax income ............................... 301,735 230,788

Income tax expense ............................ 105,607 80,900
----------
----------

Net income .................................. $ 196,128 $149,888
========== ==========
</TABLE>

(1) Since commencement of operations May 22, 1996.

See accompanying financial documents.
<PAGE>

Statement of Stockholder's Equity

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Year Ended Period Ended
December 31, December 31,
1997 1996 (1)
------------------- -------------------
<S> <C> <C>
Capital stock
Beginning of year ................................ $2,000,000 $ --
----------
Stock issuance ................................ -- 2,000,000
---------- ----------
End of year ...................................... 2,000,000 2,000,000
---------- ----------

Additional paid-in capital
Beginning of year ................................ 6,000,000 --
Capital contributions ......................... -- 6,000,000
---------- ----------
End of year ...................................... 6,000,000 6,000,000
---------- ----------

Net unrealized gain (loss) on investments
Beginning of year ................................ (2,843) --
Change in market value of investments
available for sale, net of taxes ............ 68,724 (2,843)
---------- ----------
End of year ...................................... 65,881 (2,843)
---------- ----------

Retained earnings
Beginning of year ................................ 149,888 --
Net income .................................... 196,128 149,888
---------- ----------
End of year ...................................... 346,016 149,888
---------- ----------

Total stockholder's equity ....................... $8,411,897 $8,147,045
========== ==========

</TABLE>

(1) Since commencement of operations May 22, 1996.

See accompanying financial documents.
<PAGE>

Statement of Cash Flows

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Year Ended Period Ended
December 31, December 31,
1997 1996 (1)
------------------- -------------------
<S> <C> <C>
Cash flows from operating activities:
Net income .................................... $196,128 $149,888
Adjustments to reconcile net income
to net cash provided by operating
activities:
Amortization of discount and premium on investmen 1,155 128
Change in:
Accrued investment income ............... (28,385) (40,606)
Income taxes recoverable ................ 14,207 (22,600)
Other assets and liabilities, net ....... (69,575) 137,602
----------
----------
Net cash provided by operating activities ... 113,530 224,412
---------- ----------

Cash flows from investing activities:
Purchases of:
Fixed maturities available for sale ......... (7,739,134) (504,922)
----------
----------
Net cash used by investing activities ....... (7,739,134) (504,922)
---------- ----------

Cash flows from financing activities:
Capital stock issued .......................... -- 2,000,000
Capital contribution from Parent .............. -- 6,000,000
----------
----------
Net cash provided by financing activities ... -- 8,000,000
---------- ----------
Net increase (decrease) in cash
and short-term investments ................ (7,625,604) 7,719,490

Cash and short-term investments, beginning of period 7,719,490 --
---------- ----------

Cash and short-term investments, end of period ... $ $7,719,490
93,886
========== ==========

</TABLE>

(1) Since commencement of operations May 22, 1996.

See accompanying financial documents.
<PAGE>
Jackson National Life Insurance Company of New York
Notes to Financial Statements
December 31, 1997

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

1. Nature of Operations

Jackson National Life Insurance Company of New York, (the "Company" or
"JNL/NY") is wholly owned by Jackson National Life Insurance Company,
("JNL" or the "Parent") a wholly owned subsidiary of Brooke Life Insurance
Company ("Brooke") which is ultimately a wholly owned subsidiary of
Prudential Corporation, plc ("Prudential"), London, England. JNL/NY is
licensed to sell individual annuity products, including immediate and
deferred annuities, guaranteed investment contracts, variable annuities,
and individual life insurance products in the state of New York.

The Company was capitalized with an $8,000,000 capital contribution on May 22,
1996 and licensed to transact business in New York effective August 16, 1996.
However, there have been no product sales since this date.

2. Summary of Significant Accounting Policies

Basis of Presentation
The accompanying consolidated financial statements have been prepared in
accordance with generally accepted accounting principles ("GAAP").

The preparation of the financial statements in conformity with generally
accepted accounting principles requires the use of estimates and
assumptions that affect the amounts reported in the financial statements
and the accompanying notes. Actual results may differ from those estimates.

Investments
Cash and short-term investments primarily include cash, commercial paper,
and money market instruments. All such investments are carried at cost,
which approximates fair value. These investments have maturities of three
months or less, and are considered cash equivalents for reporting cash
flows.

Fixed maturities include bonds and mortgage-backed securities. All fixed
maturities are considered available for sale and are carried at aggregate
market value. The Company has no securities classified as held to maturity.

Acquisition premiums and discounts on investments are amortized to
investment income using call or maturity dates. The changes in unrealized
gains or losses of investments classified as available for sale, net of tax
are excluded from income and credited or charged directly to stockholder's
equity.

Federal Income Taxes
The Company provides deferred income taxes on the temporary differences
between the tax and financial statement basis of assets and liabilities.

JNL/NY currently files a federal income tax return on a separate company
basis. Income tax expense is calculated on a separate company basis.

Revenue and Expense Recognition
Revenues consist primarily of investment income earned. Expenses consist
primarily of costs related to establishing operations.

3. Fair Value of Financial Instruments

The following summarizes the basis used by the Company in estimating its
fair value disclosures for financial instruments:

Cash and Short-Term Investments:
Carrying value is considered to be a reasonable estimate of fair value.

<PAGE>
Jackson National Life Insurance Company of New York
Notes to Financial Statements
December 31, 1997

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

3. Fair Value of Financial Instruments (cont'd)

Fixed Maturities:
Fair values are based on quoted market prices.

4. Investments

Investments are comprised of fixed-interest securities, primarily
publicly-traded industrial, mortgage-backed, and government bonds. The
Company's investments resulted from the original capital investment by its
parent.

Debt Securities
The Company's fixed maturity investments are all rated "AAA" by nationally
recognized statistical rating organizations. The amortized cost and
estimated market value of fixed maturity investments available for sale
were as follows:
<TABLE>
<CAPTION>

Gross Gross Estimated
Amortized Unrealized Unrealized Market
December 31, 1997 Cost Gains Losses Value
---------------- ---------------- --------------- ----------------

<S> <C> <C> <C>
U.S. Treasury securities $ 1,010,546 $ 6,484 - $ 1,017,030

Mortgaged-backed securities 7,232,227 94,871 - 7,327,098
---------------- ---------------- --------------- ----------------

Total $ 8,242,773 $ 101,355 - $ 8,344,128
================ ================ =============== ================

Gross Gross Estimated
Amortized Unrealized Unrealized Market
December 31, 1996 Cost Gains Losses Value
---------------- ---------------- --------------- ----------------

U.S. Treasury securities $ $ $ $ 500,420
504,794 - 4,374
---------------- ---------------- --------------- ----------------

Total $ $ $ $
504,794 - 4,374 500,420
================ ================ =============== ================
</TABLE>

The amortized cost and estimated market value of fixed maturities at
December 31, 1997, 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.

Fixed maturities available for sale:
<TABLE>
<CAPTION>

Amortized Estimated
December 31, 1997 Cost Market Value
--------------------- ---------------------
<S> <C> <C>
Due after 1 year through 5 years $ 1,010,546 $ 1,017,030
Mortgage-backed securities 7,232,227 7,327,098
===================== =====================
Total $ 8,242,773 $ 8,344,128
===================== =====================
</TABLE>
<PAGE>

Jackson National Life Insurance Company of New York
Notes to Financial Statements
December 31, 1997

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

4. Investments (cont'd)
<TABLE>
<CAPTION>

Amortized Estimated
December 31, 1996 Cost Market Value
--------------------- ---------------------
<S> <C> <C>
Due after 1 year through 5 years $ 504,794 $ 500,420
===================== =====================
Total $ 504,794 $ 500,420
===================== =====================
</TABLE>

Discounts and premiums on collateralized mortgage obligations are amortized
over the estimated redemption period using the effective interest method.
Yields which are used to calculate premium/discount amortization are
adjusted periodically for prepayments.

Fixed maturities with a carrying value of $1,017,000 and $500,000 were on
deposit with the State of New York at December 31, 1997 and 1996,
respectively, as required by laws governing insurance company operations.

5. Investment Income and Realized Gains and Losses

All investment income for 1997 and 1996 was interest income on fixed
maturities. No realized gains or losses were recognized in 1997 or 1996.

6. Federal Income Taxes

The federal income tax provisions for 1997 and 1996 were computed using the
tax rates and regulations in effect during each year.

Federal income taxes paid were $91,400 and $103,500 in 1997 and 1996,
respectively.

The tax effects of temporary differences that give rise to deferred tax
assets and liabilities were as follows:
<TABLE>
<CAPTION>

December 31
1997 1996
-------------- -------------
Gross deferred tax asset

<S> <C> <C>
Net unrealized loss on available for sale securities - $ 1,531

Gross deferred tax liability

Net unrealized gains on available for sale securities $ (35,474) -
-------------- -------------

Net deferred tax asset (liability) $ (35,474) $ 1,531
============== =============
</TABLE>

7. Contingencies

The Company is involved in no litigation that would have a material adverse
affect on the Company's financial condition or results of operations.

8. Stockholder's Equity

The amount of dividends which can be paid by the Company is limited by the
State of New York Insurance Regulations and depends on the amount of
statutory surplus and net gain from operations. No dividends were paid to
JNL in 1997 or 1996.

<PAGE>
Jackson National Life Insurance Company of New York
Notes to Financial Statements
December 31, 1997

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

9. Lease Obligation

The Company entered into a cancelable operating lease agreement under which
it occupies office space. The rent expense was $18,080 during 1997. The
future lease obligations relating to this lease are as follows:

1998 $ 108,480
1999 108,480
2000 108,932
2001 111,192
2002 112,096
Thereafter 579,916
-------
Total $1,129,096
==========

10. Related Party Transactions

The Company's investment portfolio is managed by PPM America, Inc. ("PPM"),
a registered investment advisor and a wholly owned subsidiary of Prudential

The Company has a service agreement with its parent, JNL, under which JNL
provides certain administrative services. There were no product sales
during 1997 or 1996, therefore no cost allocation was made.
<PAGE>