WRL SERIES LIFE CORPORATE ACCOUNT, 485BPOS, 2000-04-28

WRL SERIES LIFE CORPORATE ACCOUNT
485BPOS, 2000-04-28

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 27, 2000

REGISTRATION NO. 333-57681
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- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

POST-EFFECTIVE AMENDMENT NO. 5 TO

FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933
OF SECURITIES OF UNIT INVESTMENT TRUSTS
REGISTERED ON FORM N-8B-2

WRL SERIES LIFE
CORPORATE ACCOUNT
(EXACT NAME OF TRUST)

WESTERN RESERVE LIFE ASSURANCE
CO. OF OHIO
(NAME OF DEPOSITOR)

570 CARILLON PARKWAY
ST. PETERSBURG, FLORIDA 33716
(COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES)

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

COPY TO:

<TABLE>
<S> <C>
THOMAS E. PIERPAN, ESQ. STEPHEN E. ROTH, ESQ.
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO SUTHERLAND ASBILL & BRENNAN LLP
570 CARILLON PARKWAY 1275 PENNSYLVANIA AVENUE, N.W.
ST. PETERSBURG, FLORIDA 33716 WASHINGTON, DC 20004-2415
(NAME AND COMPLETE ADDRESS OF AGENT FOR
SERVICE)
</TABLE>

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

It is proposed that this filing will become effective:

[ ] Immediately upon filing pursuant to paragraph (b)

[X] On (May 1, 2000) pursuant to paragraph (b)

[ ] 60 days after filing pursuant to paragraph (a)(1).

[ ] On (date) pursuant to paragraph (a)(1) of Rule 485.

SECURITIES BEING OFFERED: Variable Adjustable Life Insurance Policies

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<PAGE> 2

PART I
<PAGE> 3

VARIABLE ADJUSTABLE LIFE INSURANCE POLICY
ISSUED BY

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
AND

WRL SERIES LIFE CORPORATE ACCOUNT

Western Reserve Life Assurance Co. of Ohio ("Western Reserve") is offering
the variable adjustable life insurance policy (the "Policy") described in this
prospectus. Certain Policy provisions may vary based on the state where Western
Reserve issues the Policy. Western Reserve designed the Policy to provide:

(1) insurance protection on the life of the insured person named in
the Policy, and

(2) flexibility regarding premium payments and the amount of life
insurance benefits payable under the Policy.

A purchaser of a Policy ("Owner," "you," or "your") may allocate amounts
under the Policy to one or more of the subaccounts of the WRL Series Life
Corporate Account (the "Separate Account"). Each subaccount invests its assets
in one of the following corresponding mutual fund portfolios (each, a
"Portfolio"):

<TABLE>
<CAPTION>
DEUTSCHE ASSET MANAGEMENT VIT FUNDS FIDELITY VARIABLE INSURANCE PRODUCTS FUNDS PIMCO VARIABLE INSURANCE TRUST
----------------------------------- ------------------------------------------ ------------------------------
<S> <C> <C>
Small Cap Index Fund Growth Opportunities Portfolio Short-Term Bond Portfolio
Equity 500 Index Fund Contrafund(R) Portfolio Total Return Bond Portfolio
EAFE(R) Equity Index Fund Growth Portfolio StocksPLUS Growth and Income Portfolio
Balanced Portfolio
High Income Portfolio
Money Market Portfolio
<CAPTION>
INVESCO VARIABLE INVESTMENT FUNDS, INC.
---------------------------------------
<S> <C> <C>
INVESCO VIF -- Blue Chip Growth Fund
INVESCO VIF -- Dynamics Fund
INVESCO VIF -- Financial Services Fund
INVESCO VIF -- Health Sciences Fund
INVESCO VIF -- Market Neutral Fund
INVESCO VIF -- Small Company Growth Fund
INVESCO VIF -- Technology Fund
INVESCO VIF -- Telecommunications Fund
<CAPTION>
T. ROWE PRICE EQUITY SERIES, INC. T. ROWE PRICE INTERNATIONAL SERIES, INC. JANUS ASPEN SERIES
--------------------------------- ---------------------------------------- ------------------
<S> <C> <C>
T. Rowe Price International Stock
T. Rowe Price Mid-Cap Growth Portfolio Portfolio Growth Portfolio
T. Rowe Price Equity Income Portfolio Capital Appreciation Portfolio
T. Rowe Price New America Growth Portfolio Worldwide Growth Portfolio
High-Yield Portfolio
</TABLE>

The prospectuses describing the Portfolios accompany this prospectus and
provide information on the investment objectives and risks of investing in the
Portfolios. The Owner bears the entire investment risk for amounts allocated to
a subaccount. The Policy has no guaranteed minimum value.

The Policy provides a life insurance benefit payable after the insured
person's death, and a Cash Value (total of amounts in the subaccounts and
amounts securing Policy loans) that you may obtain by partially withdrawing
amounts from the Policy or by completely surrendering the Policy. The amount of
the life insurance benefit may, and the Cash Value will, vary daily with the
investment results of the subaccounts and any additional premium payments.
However, as long as the Policy remains in force, Western Reserve guarantees that
the life insurance benefit will never be less than the Face Amount of the Policy
through age 100. While you are not required to make additional premium payments
under the Policy, additional premium payments may be necessary to prevent lapse
if there is insufficient Cash Value.

The Policy provides a free-look period whereby you may cancel the Policy
within 20 days after receiving it. Certain states may require a free-look period
longer than 20 days. It may not be to your advantage to replace existing
insurance with this Policy.

CURRENT PROSPECTUSES FOR THE PORTFOLIOS MUST ACCOMPANY OR PRECEDE THIS
PROSPECTUS. PLEASE READ THIS PROSPECTUS AND THE PROSPECTUSES FOR THE PORTFOLIOS
CAREFULLY AND RETAIN BOTH FOR FUTURE REFERENCE. CERTAIN PORTFOLIOS MAY NOT BE
AVAILABLE IN ALL STATES.

INTERESTS IN THE POLICY AND SHARES OF THE PORTFOLIOS ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK OR DEPOSITORY
INSTITUTION, AND THE POLICY IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY. THE POLICY INVOLVES INVESTMENT RISK,
INCLUDING POSSIBLE LOSS OF PREMIUMS INVESTED.

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THE
POLICY OR DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Prospectus dated May 1, 2000

<PAGE> 4

TABLE OF CONTENTS

<TABLE>
<S> <C>
DEFINITIONS................................................. 4
SUMMARY..................................................... 6
INVESTMENT EXPERIENCE INFORMATION........................... 12
Rates of Return........................................... 12
ILLUSTRATIONS OF CASH VALUE, NET CASH VALUE AND LIFE
INSURANCE BENEFITS........................................ 13
OTHER PERFORMANCE DATA...................................... 17
WESTERN RESERVE AND THE SEPARATE ACCOUNT.................... 17
Western Reserve........................................... 17
The Separate Account...................................... 18
FACTS ABOUT THE POLICY...................................... 22
Availability of the Policy................................ 22
Applying for a Policy..................................... 22
Free-Look Period.......................................... 22
Premiums.................................................. 22
Policy Lapse and Reinstatement............................ 23
Allocation of Net Premiums and Cash Value................. 24
Policy Values............................................. 24
Transfer Privileges....................................... 26
Surrenders and Partial Withdrawals........................ 27
Loans..................................................... 28
Life Insurance Benefits................................... 29
Duration of the Policy.................................... 33
When Insurance Coverage Takes Effect...................... 33
Payment Options........................................... 34
CHARGES AND DEDUCTIONS...................................... 34
Percent of Premium Load................................... 34
Deferred Sales Charge..................................... 35
Monthly Deductions........................................ 35
Administrative Charges.................................... 36
Portfolio Expenses........................................ 37
OTHER POLICY PROVISIONS AND BENEFITS........................ 37
Ownership................................................. 37
Assignment................................................ 37
Western Reserve's Right to Contest the Policy............. 37
Suicide Exclusion......................................... 38
Misstatement of Age or Sex................................ 38
Modification of the Policy................................ 38
Payments by Western Reserve............................... 38
Reports to Owners......................................... 39
Claims of Creditors....................................... 39
Dividends................................................. 39
Supplemental Benefits and/or Riders....................... 39
</TABLE>

2
<PAGE> 5

<TABLE>
<S> <C>
FEDERAL TAX CONSIDERATIONS.................................. 40
Introduction.............................................. 40
Tax Status of the Policies................................ 40
Tax Treatment of Policy Benefits.......................... 40
Possible Tax Law Changes.................................. 42
Possible Charges for Western Reserves' Taxes.............. 42
OTHER INFORMATION ABOUT THE POLICIES AND WESTERN RESERVE.... 42
Sale of the Policies...................................... 42
Voting Privileges......................................... 42
Western Reserve's Directors and Executive Officers........ 43
Additional Information.................................... 44
Experts................................................... 44
Legal Matters............................................. 44
Legal Proceedings......................................... 44
Financial Statements...................................... 45
</TABLE>

This prospectus does not constitute an offering in any jurisdiction in
which such offering may not lawfully be made. No dealer, salesperson or other
person is authorized to give any information or make any representations in
connection with this offering other than those contained in this prospectus,
and, if given or made, you must not rely on such other information or
representations.

This Policy is not available in the State of New York.

3
<PAGE> 6

DEFINITIONS

Accumulation Unit -- A unit of measurement used to calculate values under
the Policy.

Administrative Office -- Western Reserve's administrative office located at
4333 Edgewood Road NE, Cedar Rapids, Iowa 52499, (610) 439-5253.

Attained Age -- The Insured's age on the Effective Date, plus the number of
complete Policy Years since the Effective Date.

Beneficiary -- The person(s) to whom Western Reserve pays the Life
Insurance Benefit proceeds upon the Insured's death.

Cash Value -- During the free look period, the Cash Value is the amount in
the General Account. After the free look period, the Cash Value is the sum of
the value of the Policy's accumulation units in each Subaccount and the Loan
Account.

Code -- The Internal Revenue Code of 1986, as amended.

Due Proof of Death -- Proof of death satisfactory to Western Reserve. Due
Proof of Death may consist of the following: (1) a certified copy of the death
record; (2) a certified copy of a court decree reciting a finding of death; or
(3) any other proof satisfactory to Western Reserve.

Effective Date -- The date shown in the Policy when insurance coverage is
effective and monthly deductions commence under the Policy. Western Reserve uses
the Effective Date to determine Policy Months, Policy Years, and Policy
Anniversaries. If the Effective Date would fall on the 29th, 30th or 31st day of
any month, the Effective Date will be the 28th day of the month.

Face Amount -- A dollar amount the Owner selects that is shown in the
Policy and used to determine the Life Insurance Benefit.

General Account -- Western Reserve's assets other than those allocated to
the Separate Account or any other separate account Western Reserve establishes.

Indebtedness -- The Loan Amount plus any accrued loan interest.

Insured -- The person whose life is insured by the Policy.

Issue Age -- The Insured's age on the Effective Date.

Lapse -- Termination of the Policy at the expiration of the Late Period
while the Insured is still living.

Late Period -- A 62-day period during which an Owner may make premium
payments to cover the overdue (and other specified) monthly deductions and
thereby prevent the Policy from lapsing.

Life Insurance Benefit -- The amount payable to the Beneficiary under a
Life Insurance Benefit Option before adjustments if the Insured dies while the
Policy is in force.

Life Insurance Benefit Option -- One of three options that an Owner may
select for the computation of the Life Insurance Benefit Proceeds.

Life Insurance Benefit Proceeds -- The total amount payable to the
Beneficiary if the Insured dies while the Policy is in force. The Life Insurance
Benefit Proceeds include reductions for any outstanding Indebtedness and any due
and unpaid charges.

Loan Account -- A portion of the General Account to which Western Reserve
transfers Cash Value to provide collateral for any loan taken under the Policy.

Loan Account Value -- The Cash Value in the Loan Account.

Loan Amount -- The Loan Amount on the last Policy Anniversary plus any new
loans minus any loan repayments. On each Policy Anniversary, Western Reserve
adds unpaid loan interest to the Loan Amount.

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<PAGE> 7

Monthly Deduction Day -- The same date in each succeeding month as the
Effective Date. Whenever the Monthly Deduction Day falls on a date other than a
Valuation Day, Western Reserve will deem the Monthly Deduction Day to be the
next Valuation Day.

Net Cash Value -- The amount payable on surrender of the Policy. It is
equal to the Cash Value as of the date of surrender minus any outstanding Policy
loan and any loan interest due, plus refund of premium load at surrender, if
applicable.

Net Premium -- The portion of any premium available for allocation to the
Subaccounts equal to the premium paid less the applicable percent of premium
load.

1940 Act -- The Investment Company Act of 1940, as amended.

NYSE -- New York Stock Exchange.

Owner -- The owner of the Policy, as shown in Western Reserve's records.
All of the rights and benefits of the Policy belong to the Owner, unless
otherwise stated in the Policy.

Planned Premium -- The premium the Owner selects as a level amount that he
or she plans to pay on a quarterly, semi-annual or annual basis over the life of
the Policy.

Policy Anniversary -- The same date in each Policy Year as the Effective
Date.

Policy Month -- A one-month period beginning on the Monthly Deduction Day.

Policy Year -- A twelve-month period beginning on the Effective Date or on
a Policy Anniversary.

Portfolio(s) -- A series of a mutual fund in which a corresponding
Subaccount invests its assets.

SEC -- U.S. Securities and Exchange Commission.

Separate Account -- WRL Series Life Corporate Account, a separate
investment account Western Reserve established to receive and invest Net
Premiums allocated under the Policy.

Settlement Option -- The manner in which an Owner or Beneficiary elects to
receive the amount of any surrender or partial withdrawal or the Life Insurance
Benefit Proceeds.

Subaccount -- A subdivision of the Separate Account, whose assets are
invested in a corresponding Portfolio.

Subaccount Value -- The Cash Value in a Subaccount.

Target Premium -- An amount of premium used to determine the percent of
premium load. It is equal to the seven-pay limit defined in Section 7702(A) of
the Code.

Valuation Day -- For each Subaccount, each day on which the New York Stock
Exchange is open for business except for days that a Subaccount's corresponding
Portfolio does not value its shares. Currently, there are no days when the New
York Stock Exchange is open for business and a Portfolio does not value its
shares.

Valuation Period -- The period that starts at the close of regular trading
on the New York Stock Exchange on any Valuation Day and ends at the close of
regular trading on the next succeeding Valuation Day.

5
<PAGE> 8

SUMMARY

The following summary of prospectus information provides a brief overview
of the more significant aspects of the Policy. You should read this summary in
conjunction with the detailed information appearing elsewhere in this
prospectus.

Under Western Reserve's current rules, Western Reserve will offer the
Policy to corporations and partnerships that meet the following conditions at
issue:

- a minimum of five (5) Policies are issued, each on the life of a
different Insured; or

- the aggregate annualized first-year planned periodic premium for all
Policies is at least $100,000.

1. WHAT IS THE POLICY'S OBJECTIVE?

The Policy's provides for:

- the payment of a minimum Life Insurance Benefit to a Beneficiary
upon the Insured's death;

- the accumulation of Cash Value; and

- surrender rights and Policy loan privileges.

The Policy allows Owners to allocate Net Premiums to one or more
Subaccounts of the Separate Account. Each Subaccount invests in a designated
Portfolio. Western Reserve does not guarantee the amount and/or duration of the
life insurance coverage and the Cash Value of the Policy, both of which may
increase or decrease depending upon the investment experience of the
Subaccounts. Accordingly, the Owner bears the investment risk of any
depreciation in value of the underlying assets of the Separate Account but reaps
the benefits of any appreciation in value. (See Allocation of Net Premiums and
Cash Value -- Allocation of Net Premiums, p. 24.)

2. WHAT LIFE INSURANCE BENEFIT OPTIONS ARE AVAILABLE UNDER THE POLICY?

The Policy provides the payment of benefits upon the death of the Insured.
The Policy contains three Life Insurance Benefit (also known as death benefit)
options.

- Under Life Insurance Benefit Option 1, the Life Insurance Benefit is
the greater of the Face Amount of the Policy, or a specified
percentage multiplied by the Cash Value of the Policy on the date of
death of the Insured.

- Under Life Insurance Benefit Option 2, the Life Insurance Benefit is
the greater of the Face Amount of the Policy plus the Cash Value of
the Policy on the date of death of the Insured, or a specified
percentage multiplied by the Cash Value of the Policy on the date of
death of the Insured.

- Under Life Insurance Benefit Option 3, the Life Insurance Benefit is
the greater of the Face Amount of the Policy plus the cumulative
premiums paid less cumulative partial withdrawals, or a specified
percentage multiplied by the Cash Value of the Policy on the date of
death of the Insured.

Western Reserve may pay benefits under the Policy in a lump sum or under
one of the settlement options set forth in the Policy. (See Payment Options, p.
34.)

Certain optional insurance benefits are available under the Policy. Western
Reserve will deduct the cost of these optional insurance benefits from Cash
Value as part of the monthly deduction. (See Charges and Deductions -- Monthly
Deductions, p. 35.)

3. HOW MAY THE AMOUNT OF THE LIFE INSURANCE BENEFIT AND CASH VALUE VARY?

Under any Life Insurance Benefit Option, as long as the Policy remains in
force, the Life Insurance Benefit will not be less than the current Face Amount
of the Policy. The Life Insurance Benefit may, however,

6
<PAGE> 9

exceed the Face Amount under certain circumstances. The amount by which the Life
Insurance Benefit exceeds the Face Amount depends upon the option chosen and the
Cash Value of the Policy. The amount of Life Insurance Benefit Proceeds will
reflect reductions for any outstanding Indebtedness and any due and unpaid
charges, and additions for any additional insurance benefits added by rider.
(See Facts About the Policy -- Life Insurance Benefits, p. 29.)

The Policy's Cash Value will reflect the amount and frequency of premium
payments, the investment experience of the chosen Subaccounts, any partial
withdrawals, and any charges imposed in connection with the Policy. The Owner
bears the entire investment risk for amounts allocated to the Separate Account.
Western Reserve does not guarantee a minimum Cash Value. (See Facts About the
Policy -- Policy Values, p. 24.)

4. MAY AN OWNER ADJUST THE AMOUNT OF THE LIFE INSURANCE BENEFIT?

The Owner has significant flexibility to adjust the Life Insurance Benefit
payable by changing the Life Insurance Benefit Option type, and by increasing or
decreasing the Face Amount of the Policy or adding riders to increase the total
Life Insurance Benefit payable. You may not change the Life Insurance Benefit
Option type during the first Policy Year. (See Life Insurance
Benefits -- Changing the Life Insurance Benefit Option, p. 32.) Owners also may
not change the Face Amount during the first Policy Year. Any increase in the
Face Amount will require additional evidence of insurability satisfactory to
Western Reserve, and will result in additional charges. (See Facts About the
Policy -- Life Insurance Benefits, p. 29; and Monthly Deductions -- Cost of
Insurance, p. 35.)

5. WHAT FLEXIBILITY DOES AN OWNER HAVE REGARDING PREMIUMS?

An Owner has considerable flexibility concerning the amount and frequency
of premiums. Western Reserve will require the Owner to pay an initial premium
before insurance coverage is in force. Thereafter, an Owner may, subject to
certain restrictions, make premium payments in any amount and at any frequency.
(See Facts About the Policy -- Premiums, p. 22.)

Each Owner will determine a schedule for premium payments ("Planned
Periodic Premium"). The schedule will provide a premium payment of a level
amount at a fixed interval over a specified period of time. Your Policy will
prescribe the amount and frequency of Planned Periodic Premiums and you may
change them upon written request. (See Facts About the Policy -- Premiums, p.
22.)

Failing to pay Planned Periodic Premiums will not itself cause the Policy
to lapse, and paying Planned Periodic Premiums will not guarantee that the
Policy remains in force. Additional premiums may be necessary to prevent lapse
if the Net Cash Value is insufficient to pay certain monthly charges, and a Late
Period expires without the Owner making a sufficient payment. (See Facts About
the Policy -- Policy Lapse and Reinstatement -- Lapse, p. 23.)

6. WHEN WILL THE POLICY LAPSE?

The Policy will Lapse when Net Cash Value is insufficient to pay the
monthly deduction, and a Late Period expires without the Owner making a
sufficient payment. (See Charges and Deductions -- Monthly Deductions, p. 35;
and Policy Lapse and Reinstatement, p. 23.) Such a Lapse could happen if the
investment experience has been sufficiently unfavorable and results in a
decrease in the Net Cash Value, or the Net Cash Value has decreased because the
Owner did not pay enough premiums to offset the monthly charges.

7. HOW ARE NET PREMIUMS ALLOCATED?

The portion of the premium available for allocation ("Net Premium") equals
the premium paid less the applicable percent of premium load. (See Charges and
Deductions -- Percent of Premium Load, p. 34.) The Owner initially determines
the allocation of the Net Premium among the Subaccounts of the Separate Account,
each of which invests in shares of a designated Portfolio. Each Portfolio has a
different investment objective. (See Investments of the Separate Account, p.
18.)

Until the end of the free-look period, Western Reserve will allocate all
premiums to the General Account, notwithstanding the allocation instructions in
the application. (See Facts About the Policy -- Free-Look

7
<PAGE> 10

Period, p. 22.) You may change the allocation of future Net Premiums without
charge at any time by providing Western Reserve with written notification from
the Owner, or by calling the Administrative Office at (610) 439-5253.

An Owner may transfer Cash Value among the Subaccounts, subject to certain
restrictions. The transfer will be effective on the first Valuation Date on or
following the day the Administrative Office receives appropriate notice of such
transfer, based on the price next determined following receipt of the notice.
(See Facts About the Policy -- Transfer Privileges, p. 26.)

8. IS THERE A "FREE-LOOK" PERIOD?

The Policy provides a free-look period whereby the Owner may cancel the
Policy within 20 days after receiving it. Certain states require a free-look
period longer than 20 days, either for all Owners or for certain classes of
Owners. In most states, Western Reserve will refund the greater of the Policy's
Cash Value as of the date the Policy is returned or the amount of premiums paid,
less any partial withdrawals. (See Facts About the Policy -- Free-Look Period,
p. 22.) Under ordinary circumstances, the refunded amount will be the premiums
paid less partial withdrawals.

9. MAY THE POLICY BE SURRENDERED?

The Owner may totally surrender the Policy at any time and receive the Net
Cash Value of the Policy. If the Owner surrenders the Policy during the first
three Policy Years, Western Reserve will refund a portion of the Percent of
Premium Load charged in that Policy Year. (See Charges and Deductions -- Percent
of Premium Load, p. 34.)

Subject to certain limitations, the Owner may also make partial withdrawals
from the Policy at any time after the first Policy Year. (See Facts About the
Policy -- Surrenders and Partial Withdrawals, p. 27.) If Life Insurance Benefit
Option 1 is in effect, partial withdrawals will reduce the Policy's Face Amount
by the amount of the partial withdrawal. If Life Insurance Benefit Option 3 is
in effect and total partial withdrawals are greater than the sum of the
premiums, the Face Amount is reduced by the amount of the partial withdrawals
minus the sum of the premiums; otherwise the Face Amount is not reduced.

Surrendering the Policy and taking partial withdrawals may have tax
consequences. (See Federal Tax Considerations -- Tax Treatment of Policy
Benefits, p. 40.)

10. WHAT IS THE LOAN PRIVILEGE?

After the first Policy Anniversary, an Owner may obtain a Policy loan in
any amount (minimum $500) which is not greater than 90% of the Cash Value less
any already outstanding loan. Western Reserve retains the right to permit a
Policy loan prior to the first Policy Anniversary for certain Policies. A loan
taken from, or secured by, a Policy may be treated as a taxable distribution,
and also may be subject to a penalty tax. (See Federal Tax Considerations, p.
40.)

The guaranteed annual interest rate on a Policy loan is 6.0% and is due on
each Policy Anniversary for the prior Policy Year and on the date the loan is
repaid. The current annual interest rate on a Policy loan is 4.35% in all Policy
Years. (See Facts About the Policy -- Loans -- Interest Rate Charged, page 28.)
Western Reserve will transfer the requested amount of a loan, plus interest for
one year in advance, from the Subaccounts to the Loan Account and credit this
amount at the end of each Policy Year with interest at a rate of 4% per year.
Upon repayment of a loan, Western Reserve will transfer amounts in the Loan
Account in excess of the outstanding value of the loan to the Subaccounts in the
same manner as Net Premium allocations.

There are risks involved in taking a Policy loan, a few of which include
the potential for a Policy to lapse if projected earnings, taking into account
any outstanding loans, are not achieved, as well as adverse tax consequences
which occur if a Policy lapses with loans outstanding. (See Federal Tax
Considerations -- Tax Treatment of Policy Benefits, p. 40.)

8
<PAGE> 11

11. WHAT CHARGES AND DEDUCTIONS ARE ASSESSED UNDER THE POLICY?

Western Reserve assesses certain charges and deductions under the Policy to
compensate for services and benefits provided, costs and expenses incurred, and
risks assumed by Western Reserve in connection with the Policies. Some charges
are assessed as percentages of Cash Value or premium payments, and others are
assessed as a flat dollar amount. The charges and deductions under the Policy
include the following:

PERCENT OF PREMIUM LOAD. During the first Policy Year, Western Reserve
deducts 9.5% of each premium received up to the Target Premium, and 3.0% of each
premium received in excess of the Target Premium. During Policy Years 2-7,
Western Reserve deducts 9.5% of each premium received up to the Target Premium,
and 7.5% of each premium received in excess of the Target Premium. The maximum
percent of premium load deduction is 11.5% of each premium received up to the
Target Premium in the first 7 Policy Years. In Policy Years 8+, Western Reserve
deducts 4.5% of all premiums received. Under most circumstances, the Target
Premium is the maximum premium an Owner can pay in a Policy Year without the
Policy becoming a Modified Endowment Contract. Premiums paid in excess of the
Target Premium may have adverse tax consequences. (See Federal Tax
Considerations -- Tax Treatment of Policy Benefits, p. 40.) If the Owner
surrenders the Policy during the first three Policy Years, Western Reserve will
refund a portion of the Percent of Premium Load charged in that Policy Year.
(See Charges and Deductions -- Percent of Premium Load, p. 34.)

DEFERRED SALES CHARGE. On each Policy Anniversary during Policy Years 2-7,
Western Reserve currently deducts 1% of the amount of any decrease in excess
premium received in Policy Years 2-7 from the excess premium received in the
first Policy Year. The maximum deferred sales charge is 1.5% in Policy Years
2-7.

MONTHLY DEDUCTION. Each month, Western Reserve makes a Monthly Deduction
from the Cash Value to cover the cost of administering the Policies (Monthly
Policy Charge), the cost of providing insurance protection under the Policy
(i.e., the cost of insurance charge) including any insurance benefits provided
by rider, and the mortality and expense risk charge.

MONTHLY POLICY CHARGE. Western Reserve deducts a monthly charge equal to
$16.50 in the first Policy Year, and $4.00 (current, $10 maximum) in subsequent
Policy Years to compensate Western Reserve for the cost of administering the
Policies.

MORTALITY AND EXPENSE RISK CHARGE. On each Monthly Deduction Day, Western
Reserve currently deducts a mortality and expense risk charge equal to an annual
rate of 0.35% of the Cash Value in the Subaccounts in all Policy Years. The
maximum annual rate of this charge in any Policy Year is 0.90% of the Cash Value
in the Subaccounts.

TRANSFER CHARGE. Western Reserve reserves the right to apply a $25
transfer charge for each transfer after the first 12 transfers in any Policy
Year.

PARTIAL WITHDRAWAL CHARGE. Western Reserve deducts a charge equal to the
lesser of $25 or 2% of the amount requested to cover administrative expenses
associated with each partial withdrawal.

PORTFOLIO EXPENSES. The Portfolios incur investment advisory fees and
other expenses that are reflected as an annual rate of the average daily net
assets of each Portfolio. The levels of the fees and expenses for the year ended
December 31, 1999 vary among the Portfolios and are described below and in the
prospectuses for the Portfolios:

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<PAGE> 12

<TABLE>
<CAPTION>
MANAGEMENT FEE OTHER TOTAL ANNUAL
(AFTER WAIVER EXPENSES (AFTER WAIVER EXPENSES (AFTER WAIVER
PORTFOLIO OR REIMBURSEMENT) OR REIMBURSEMENT) OR REIMBURSEMENT)
--------- ----------------- ---------------------- ----------------------
<S> <C> <C> <C>
Fidelity VIP Balanced(2)......... 0.44% 0.14% 0.58%
Fidelity VIP High Income......... 0.58% 0.12% 0.70%
Fidelity VIP Money Market........ 0.20% 0.10% 0.30%
PIMCO Short-Term Bond(3)......... 0.35% 0.25% 0.60%
PIMCO Total Return Bond(3)....... 0.40% 0.25% 0.65%
PIMCO StocksPLUS Growth and
Income(3)...................... 0.40% 0.25% 0.65%
T. Rowe Price Mid-Cap Growth(5).. 0.85% 0.00% 0.85%
T. Rowe Price Equity Income(5)... 0.85% 0.00% 0.85%
T. Rowe Price New America
Growth(5)...................... 0.85% 0.00% 0.85%
T. Rowe Price International
Stock(5)....................... 1.05% 0.00% 1.05%
Janus Aspen Series Growth(4)..... 0.65% 0.02% 0.67%
Janus Aspen Series Capital
Appreciation(4)................ 0.65% 0.04% 0.69%
Janus Aspen Series Worldwide
Growth(4)...................... 0.65% 0.05% 0.70%
Janus Aspen Series High
Yield(4)....................... 0.00% 1.00% 1.00%
INVESCO VIF -- Blue Chip
Growth(6)(7)(8)................ 0.85% 1.02% 1.87%
INVESCO VIF --
Dynamics(6)(7)(8).............. 0.75% 0.51% 1.26%
INVESCO VIF -- Financial
Services(6)(8)................. 0.75% 0.64% 1.39%
INVESCO VIF -- Health
Sciences(6)(8)................. 0.75% 0.73% 1.48%
INVESCO VIF -- Market
Neutral(6)(8).................. 0.75% 1.51% 2.26%
INVESCO VIF -- Small Company
Growth(6)(7)(8)................ 0.75% 0.95% 1.70%
INVESCO VIF --
Technology(6)(8)............... 0.75% 0.56% 1.31%
INVESCO VIF --
Telecommunications(6)(8)....... 0.75% 0.52% 1.27%
</TABLE>

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

(1) For the year ended December 31, 1999, the investment adviser agreed to waive
a portion of its management fee with respect to each Portfolio so that each
Portfolio's total annual expenses would not exceed the amounts shown in the
table. Without such waiver, each Portfolio's total annual expenses would
have been equal to the following: Small Cap Index -- 1.58%; Equity 500
Index -- 1.19%; and EAFE(R) Equity Index -- 1.66%.

(2) A portion of the brokerage commissions that certain Portfolios paid was used
to reduce each of these Portfolio's expenses. In addition, certain
Portfolio's entered into arrangements with their custodian whereby credits
realized as a result of uninvested cash balances were used to reduce
custodian expenses. Without these reductions, the total annual expenses
would have been equal to the following: Growth Opportunities -- 0.71%,
Contrafund(R) -- 0.70%, Growth -- 0.68%, Balanced -- 0.59%.

(3) PIMCO has contractually agreed to reduce total Portfolio operating expenses
to the extent they would exceed, due to the payment of organizational
expenses and Trustees' fees, the fees listed above. Without such reductions,
the total annual expenses for the fiscal year ended December 31, 1999 would
have been equal to the following: Short-Term Bond -- 1.42%, Total Return
Bond -- 0.69% and StocksPLUS Growth and Income -- 0.65%. Under the Expense
Limitation Agreement, PIMCO may recoup these

10
<PAGE> 13

waivers and reimbursements in future periods, not exceeding three years,
provided that total expenses (including such recoupment) do not exceed the
annual expense limit. Effective April 1, 2000, the fees have been restated.
The new fees are 0.45% for Short-Term Bond, 0.50% for Total Return Bond, and
0.50% for StocksPLUS Growth and Income.

(4) Expenses are based on expenses for the fiscal year ended December 31, 1999,
restated to reflect a reduction in the management fee for Growth, Capital
Appreciation, and Worldwide Growth Portfolios. Expenses are stated with
contractual waivers by Janus Capital Corporation, the investment adviser.
Waivers, if applicable, are first applied against the management fee and
then against other expenses, and will continue until at least the next
annual renewal of the advisory agreement. Absent this agreement, the total
annual expenses for the High-Yield Portfolio would have been 4.92%.

(5) Management fee includes operating expenses.

(6) The Fund's actual Total Annual Expenses were lower than the figures shown,
because its custodian fees were reduced under an expense offset arrangement.

(7) The expense information presented in the table has been restated from the
financials to reflect a change in the administrative services fee.

(8) Certain Fund expenses were absorbed voluntarily by the investment adviser in
order to ensure that expenses for the Fund did not exceed 1.25% of the
Fund's average net assets (1.50% for VIF -- Blue Chip Growth; 1.15% for
VIF -- Dynamics) pursuant to an agreement between the Fund and the
investment adviser. This commitment may be changed at any time following
consultation with the board of directors. Absent such absorption, but
excluding any expense offset arrangements, Other Expenses and total Annual
Expenses as a percentage of each of the Fund's average net assets for the
fiscal year ended 12/31/99 were: VIF -- Blue Chip Growth, 8.31% and 9.16%
respectively; VIF -- Dynamics, 1.53% and 2.28% respectively,
VIF -- Financial Services, 1.75% and 2.50% respectively; VIF -- Health
Sciences, 2.11% and 2.86% respectively; VIF -- Market Neutral, 2.57% and
3.32% respectively; VIF -- Small Company Growth, 3.35% and 4.10%
respectively; VIF -- Technology, 0.78% and 1.53% respectively;
VIF -- Telecommunications, 0.55% and 1.30% respectively.

12. ARE TRANSFERS PERMITTED AMONG THE SUBACCOUNTS?

An Owner may transfer Cash Value among the Subaccounts of the Separate
Account. Each Policy Year, you may make 12 Cash Value transfers without
incurring any charge. Each additional transfer in a Policy Year may be subject
to a transfer charge of $25. Western Reserve may at any time revoke or modify
the transfer privilege. (See Facts About the Policy -- Transfer Privileges, p.
26.)

13. WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF PURCHASING A POLICY?

Western Reserve intends for the Policy to satisfy the definition of a life
insurance contract under Section 7702 of the Code. However, there is less
guidance with respect to Policies issued on a substandard basis and it is not
clear that these Policies will satisfy the applicable definition in all
circumstances, particularly if the full amount of premiums is paid. Under
certain circumstances, a Policy may be treated as a "modified endowment
contract" depending upon the amount of premiums paid in relation to the Life
Insurance Benefit. (See Tax Treatment of Policy Benefits -- Modified Endowment
Contracts, p. 41.) If the Policy is a modified endowment contract, then all
pre-death distributions, including Policy loans and loans secured by a Policy,
will be treated first as a distribution of taxable income to the extent of any
gain and then as a return of basis or investment in the contract. In addition,
any distributions of gains generally will be subject to a 10% penalty tax.

If the Policy is not a modified endowment contract, distributions generally
will be treated first as a return of basis or investment in the Policy and then
as disbursing taxable income. Moreover, Policy loans and loans

11
<PAGE> 14

secured by a Policy will generally not be treated as distributions but there is
uncertainty as to the tax treatment of loans from the Policy after the first
Policy Year. Finally, neither distributions nor loans from a Policy that is not
a modified endowment contract are subject to the 10% penalty tax. For further
elaboration on the tax consequences of a Policy, see Federal Tax Considerations,
p. 40.

In recent years, Congress has adopted new rules relating to life insurance
owned by businesses. Any business contemplating the purchase of a new life
insurance contract or a change in an existing life insurance contract should
consult a tax adviser. You should consult a tax adviser with respect to
legislative developments and their effect on the Policy. (See Federal Tax
Considerations, p. 40.)

INVESTMENT EXPERIENCE INFORMATION

The information provided in this section shows the historical investment
experience of the Portfolios and hypothetical illustrations of the Policy based
on the historical investment experience of the Portfolios. It does not represent
or project future investment performance.

The Policies became available for sale and the Separate Account began
operations in December of 1998. The Portfolios' dates of inception are indicated
in the table below. The rates of return shown below depict the actual investment
experience of each Portfolio for the periods shown. The actual rate of return in
each calendar year was assumed to be uniformly earned throughout that year. The
actual performance of the Portfolios has and will vary throughout the year.

Rates of Return

The rates of return shown below are based on the Portfolios' actual
investment performance, after the deduction of investment advisory fees and
other expenses of the Portfolios. The rates are average annual compounded rates
of return for the periods ended on December 31, 1999.

These rates of return do not reflect the percent of premium load, deferred
sales loads, or monthly deductions from Cash Value. Accordingly, these rates of
return do not illustrate how actual investment performance will affect benefits
under the Policies. Moreover, these rates of return are not an estimate,
projection or guarantee of future performance.

12
<PAGE> 15

AVERAGE ANNUAL COMPOUNDED RATES OF RETURN FOR THE PERIODS ENDED DECEMBER 31,
1999

<TABLE>
<CAPTION>
10 YEARS OR
SINCE
PORTFOLIO (DATE OF INCEPTION) 1 YEAR 5 YEARS INCEPTION*
----------------------------- ------ ------- ---------------
<S> <C> <C> <C>
Deutsche VIT Small Cap Index (8/25/97)................ 20.16% N/A 9.37%*
Deutsche VIT Equity 500 Index (10/1/97)............... 20.39% N/A 22.52%*
Deutsche VIT EAFE(R) Equity Index (8/28/97)........... 27.60% N/A 17.03%*
Fidelity VIP Growth Opportunities (1/3/95)............ 4.27% N/A 21.51%*
Fidelity VIP Contrafund(R) (1/3/95)................... 24.25% N/A 27.73%*
Fidelity VIP Growth (10/9/86)......................... 37.44% 29.74% 19.94%
Fidelity VIP Balanced (1/3/95)........................ 4.55% N/A 13.50%*
Fidelity VIP High Income (9/19/85).................... 8.15% 10.88% 12.43%
Fidelity VIP Money Market (4/1/82).................... 5.17% 5.48% 5.28%
PIMCO Short-Term Bond** (9/30/99)..................... N/A N/A 1.32%*
PIMCO Total Return Bond (12/31/97).................... (0.58)% N/A 3.91%*
PIMCO StocksPLUS Growth and Income (12/31/97)......... 19.85% N/A 24.87%*
T. Rowe Price Mid-Cap Growth (12/31/96)............... 23.73% N/A 21.52%*
T. Rowe Price Equity Income (3/31/94)................. 3.72% 18.62% 17.40%*
T. Rowe Price New America Growth (3/31/94)............ 12.75% 24.04% 20.80%*
T. Rowe Price International Stock (3/31/94)........... 33.32% 15.22% 13.45%*
Janus Aspen Series Growth (9/13/93)................... 43.98% 29.89% 24.28%*
Janus Aspen Series Capital Appreciation (5/1/97)...... 67.00% N/A 57.18%*
Janus Aspen Series Worldwide Growth (9/13/93)......... 64.45% 33.60% 29.71%*
Janus Aspen Series High Yield (5/1/96)................ 6.85% N/A 9.83%*
INVESCO VIF -- Blue Chip Growth (8/25/97)............. 29.17% N/A 31.92%*
INVESCO VIF -- Dynamics (8/25/97)..................... 55.60% N/A 31.95%*
INVESCO VIF -- Financial Services** (9/21/99)......... N/A N/A 11.00%*
INVESCO VIF -- Health Sciences (5/22/97).............. 4.86% N/A 21.22%*
INVESCO VIF -- Market Neutral** (11/10/99)............ N/A N/A 2.30%*
INVESCO VIF -- Small Company Growth(8/25/97).......... 91.06% N/A 39.89%*
INVESCO VIF -- Technology (5/21/97)................... 158.93% N/A 65.49%*
INVESCO VIF -- Telecommunications** (9/21/99)......... N/A N/A 64.50%*
</TABLE>

Additional information regarding the Portfolios' investment performance
appears in the prospectuses for the Portfolios.

** Inception dates for these Portfolios was after 12/31/98.

ILLUSTRATIONS OF CASH VALUE, NET CASH VALUE AND LIFE INSURANCE BENEFITS

The following illustrations have been prepared to show how certain values
under a hypothetical Policy would change with varying levels of assumed
investment performance over an extended period of time. In particular, the
illustrations show how the Cash Value, Net Cash Value and Life Insurance Benefit
under a Policy with Life Insurance Benefit Option 3 covering an Insured of the
male sex, non-tobacco and Age 35 on the Effective Date, would vary over time if
premiums were paid annually and the return on the assets in the Portfolios were
a uniform gross annual rate (before any expenses) of 0%, 6% or 12%. THE
HYPOTHETICAL INVESTMENT RATES OF RETURN ARE FOR PURPOSES OF ILLUSTRATION ONLY
AND SHOULD NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF
RETURN. Actual rates of return for a particular Policy may be more or less than
the hypothetical investment rates of return and will depend on a number of
factors including the investment allocations made by an Owner, prevailing rates
and rates of inflation. Also, values would be different from those shown if the
gross annual investment returns averaged 0%, 6%, and 12% over a period of years
but fluctuated above and below those averages for individual Policy Years.

The illustrations assume that the assets in the Portfolios are subject to
an annual expense ratio of 0.932% of the average daily net assets. This annual
expense ratio is based on the average of the expense ratios of each of the
Portfolios for the last fiscal year and take into account current expense
reimbursement arrangements. (Such reimbursement arrangements were in effect
during the last fiscal year.) For information on Portfolio expenses, see the
prospectuses for the Portfolios.

13
<PAGE> 16

The illustrations also reflect the application of the percent of premium
load, the monthly Policy charge, the deduction of the deferred sales load, and
the monthly deduction from Cash Value for the hypothetical Insured. Western
Reserve's current cost of insurance charge, mortality and expense risk charges,
and monthly Policy charge and the higher guaranteed maximum cost of insurance,
mortality and expense risk and monthly Policy charges Western Reserve has the
contractual right to charge are reflected in separate illustrations on each of
the following pages. All the illustrations reflect the fact that no other
charges for Federal or state income taxes are currently made against the
Separate Account and assume no Loan Account Value or charges for supplemental
benefits.

After deduction of Portfolio expenses, the illustrated gross annual
investment rates of return of 0%, 6% and 12% would correspond to approximate net
annual rates for the Separate Account of -0.932%, 5.068% and 11.068%,
respectively. Net annual rates of return for the Separate Account are not equal
to net annual rates of return for the Policy because the Separate Account rates
do not reflect all charges to the Policy.

The illustrations are based on Western Reserve's sex distinct rates for
non-tobacco users. Upon request, Western Reserve will furnish a comparable
illustration based upon the proposed Insured's individual circumstances. Such
illustrations may assume different hypothetical rates of return than those
illustrated in the following illustrations.

14
<PAGE> 17

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
HYPOTHETICAL ILLUSTRATIONS
MALE ISSUE AGE 35

<TABLE>
<S> <C> <C>
Face Amount: $250,000 Guaranteed Issue Class
Annual Premium: $10,320 Life Insurance Benefit Option III
</TABLE>

USING CURRENT COST OF INSURANCE RATES, M&E RISK CHARGES, AND MONTHLY POLICY
CHARGES
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
LIFE INSURANCE BENEFIT
---------------------------------------------
ASSUMING HYPOTHETICAL GROSS AND NET
ANNUAL INVESTMENT RETURN OF
END OF PREMIUMS ---------------------------------------------
POLICY ACCUMULATED 0% (GROSS) 6% (GROSS) 12% (GROSS)
YEAR AT 5% -.932% (NET) 5.068% (NET) 11.068% (NET)
------ ------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
1.................... 10,836 260,320 260,320 260,320
2.................... 22,214 270,640 270,640 270,640
3.................... 34,160 280,960 280,960 280,960
4.................... 46,705 291,280 291,280 291,280
5.................... 59,876 301,600 301,600 301,600
6.................... 73,706 311,920 311,920 311,920
7.................... 88,227 322,240 322,240 322,240
8.................... 103,474 332,560 332,560 368,102
9.................... 119,484 342,880 342,880 425,870
10................... 136,294 353,200 353,200 487,569
15................... 233,825 404,800 508,234 847,701
20................... 358,303 456,400 663,562 1,338,512
30................... 719,931 559,600 967,602 2,965,075
40................... 1,308,986 662,800 1,310,328 6,344,690
50................... 2,268,495 766,000 1,747,890 13,751,664
60................... 3,831,433 lapse 2,351,624 30,655,523
</TABLE>

<TABLE>
<CAPTION>
CASH VALUE NET CASH VALUE
--------------------------------------------- ---------------------------------------------
ASSUMING HYPOTHETICAL GROSS AND NET ASSUMING HYPOTHETICAL GROSS AND NET
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF --------------------------------------------- ---------------------------------------------
POLICY 0% (GROSS) 6% (GROSS) 12% (GROSS) 0% (GROSS) 6% (GROSS) 12% (GROSS)
YEAR -.932% (NET) 5.068% (NET) 11.068% (NET) -.932% (NET) 5.068% (NET) 11.068% (NET)
------ ------------ ------------ ------------- ------------ ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
1.................... 8,947 9,410 9,957 9,566 10,029 10,576
2.................... 17,996 19,400 21,120 18,615 20,019 21,739
3.................... 26,965 29,813 33,429 27,584 30,432 34,048
4.................... 35,874 40,688 47,027 35,874 40,688 47,027
5.................... 44,729 52,055 62,061 44,729 52,055 62,061
6.................... 53,536 63,942 78,692 53,536 63,942 78,692
7.................... 62,286 76,368 97,085 62,286 76,368 97,085
8.................... 71,491 89,897 117,981 71,491 89,897 117,981
9.................... 80,620 104,026 141,017 80,620 104,026 141,017
10................... 89,671 118,786 166,406 89,671 118,786 166,406
15................... 133,637 202,484 337,730 133,637 202,484 337,730
20................... 174,755 304,386 613,996 174,755 304,386 613,996
30................... 243,559 575,953 1,764,926 243,559 575,953 1,764,926
40................... 266,655 956,444 4,631,161 266,655 956,444 4,631,161
50................... 122,539 1,468,815 11,556,020 122,539 1,468,815 11,556,020
60................... lapse 2,157,453 28,124,333 lapse 2,157,453 28,124,333
</TABLE>

- ---------------
The hypothetical rates of return shown above are illustrative only and should
not be deemed a representation of past or future investment rates of return.
Actual rates of return may be more or less than those shown and will depend on a
number of factors, including the investment allocations made by an Owner and the
actual investment experience of the Portfolios. The Cash Value, Net Cash Value
and Life Insurance Benefit for a Policy would be different from those shown if
the actual rates of return averaged 0.00%, 6.00%, and 12.00% over a period of
years, but also fluctuated above or below those averages for individual Policy
Years. No representations can be made that these hypothetical rates of return
can be achieved for any one year or sustained over any period of time.

15
<PAGE> 18

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO FLEXIBLE PREMIUM VARIABLE LIFE
INSURANCE HYPOTHETICAL ILLUSTRATIONS
MALE ISSUE AGE 35

<TABLE>
<S> <C> <C>
Face Amount: $250,000 Guaranteed Issue Class
Annual Premium: $10,320 Life Insurance Benefit Option III
</TABLE>

USING GUARANTEED COST OF INSURANCE RATES, M&E RISK CHARGES, AND MONTHLY POLICY
CHARGES
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
LIFE INSURANCE BENEFIT
---------------------------------------------
ASSUMING HYPOTHETICAL GROSS AND
NET ANNUAL INVESTMENT RETURN OF
END OF PREMIUMS ---------------------------------------------
POLICY ACCUMULATED 0% (GROSS) 6% (GROSS) 12% (GROSS)
YEAR AT 5% -.932% (NET) 5.068% (NET) 11.068% (NET)
- ------ ------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
1.................... 10,836 260,320 260,320 260,320
2.................... 22,214 270,640 270,640 270,640
3.................... 34,160 280,960 280,960 280,960
4.................... 46,705 291,280 291,280 291,280
5.................... 59,876 301,600 301,600 301,600
6.................... 73,706 311,920 311,920 311,920
7.................... 88,227 322,240 322,240 322,240
8.................... 103,474 332,560 332,560 332,560
9.................... 119,484 342,880 342,880 377,830
10................... 136,294 353,200 353,200 431,271
15................... 233,825 404,800 441,358 729,883
20................... 358,303 456,400 560,454 1,108,203
30................... 719,931 559,600 750,421 2,197,811
40................... 1,308,986 662,800 903,524 4,056,872
50................... 2,268,495 lapse 1,036,442 7,301,645
60................... 3,831,433 lapse 1,185,123 13,310,527
</TABLE>

<TABLE>
<CAPTION>
CASH VALUE NET CASH VALUE
--------------------------------------------- ---------------------------------------------
ASSUMING HYPOTHETICAL GROSS AND NET ASSUMING HYPOTHETICAL GROSS AND NET
ANNUAL INVESTMENT RETURN OF ANNUAL INVESTMENT RETURN OF
END OF --------------------------------------------- ---------------------------------------------
POLICY 0% (GROSS) 6% (GROSS) 12% (GROSS) 0% (GROSS) 6% (GROSS) 12% (GROSS)
YEAR -.932% (NET) 5.068% (NET) 11.068% (NET) -.932% (NET) 5.068% (NET) 11.068% (NET)
- ------ ------------ ------------ ------------- ------------ ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
1.................... 8,312 8,752 9,272 8,931 9,371 9,891
2.................... 16,430 17,741 19,348 17,049 18,360 19,967
3.................... 24,426 27,054 30,394 25,046 27,673 31,013
4.................... 32,296 36,700 42,506 32,296 36,700 42,506
5.................... 40,030 46,685 55,787 40,030 46,685 55,787
6.................... 47,622 57,017 70,353 47,622 57,017 70,353
7.................... 55,064 67,705 86,334 55,064 67,705 86,334
8.................... 63,225 79,678 104,845 63,225 79,678 104,845
9.................... 71,217 92,070 125,109 71,217 92,070 125,109
10................... 79,036 104,896 147,191 79,036 104,896 147,191
15................... 115,239 175,840 290,790 115,239 175,840 290,790
20................... 145,138 257,089 508,350 145,138 257,089 508,350
30................... 168,790 446,679 1,308,221 168,790 446,679 1,308,221
40................... 49,518 659,506 2,961,220 49,518 659,506 2,961,220
50................... lapse 870,960 6,135,836 lapse 870,960 6,135,836
60................... lapse 1,087,269 12,211,492 lapse 1,087,269 12,211,492
</TABLE>

16
<PAGE> 19

OTHER PERFORMANCE DATA

Western Reserve may compare the performance of each Subaccount in
advertising and sales literature to the performance of other variable life
issuers in general, or to the performance of particular types of variable life
insurance policies investing in mutual funds, or investment series of mutual
funds, with investment objectives similar to each of the Subaccounts whose
performance is reported by Lipper Analytical Services, Inc. ("Lipper") and
Morningstar, Inc. ("Morningstar") or reported by other services, companies,
individuals or other industry or financial publications of general interest,
such as Forbes, Money, The Wall Street Journal, Business Week, Barron's,
Kiplinger's Personal Finance and Fortune. Lipper and Morningstar are widely used
independent research services which monitor and rank the performance of variable
life insurance policies in each of the major categories of investment objectives
on an industry-wide basis.

Lipper's and Morningstar's rankings include variable annuity contracts as
well as variable life insurance policies. The performance analyses prepared by
Lipper and Morningstar rank such policies and contracts on the basis of total
return, assuming reinvestment of distributions, but do not take sales charges,
redemption fees or certain expense deductions at the separate account level into
consideration.

Western Reserve may also compare the performance of each Subaccount in
advertising and sales literature to the S&P 500, a widely used measure of stock
market performance, or other widely recognized indices. Unmanaged indices may
assume the reinvestment of dividends, but usually do not reflect any "deduction"
for the expense of operating or managing an investment portfolio.

In addition, Western Reserve may, as appropriate, compare each Subaccount's
performance to that of other types of investments such as certificates of
deposit, savings accounts and U.S. Treasuries, or to certain interest rate and
inflation indices, such as the Consumer Price Index, which is published by the
U.S. Department of Labor and measures the average change in prices over time of
a fixed "market basket" of certain specified goods and services. Similar
comparisons of Subaccount performance may also be made with appropriate indices
measuring the performance of a defined group of securities widely recognized by
investors as representing a particular segment of the securities markets. For
example, Subaccount performance may be compared with Donoghue Money Market
Institutional Average (money market rates), Lehman Brothers Corporate Bond Index
(corporate bond interest rates) or Lehman Brothers Government Bond Index (long-
term U.S. Government obligation interest rates).

WESTERN RESERVE AND THE SEPARATE ACCOUNT

WESTERN RESERVE

Western Reserve was originally incorporated under the laws of Ohio on
October 1, 1957. Western Reserve engages in the business of writing life
insurance policies and annuity contracts. Western Reserve is admitted to do
business in 49 states, the District of Columbia, Guam, and Puerto Rico. Western
Reserve's main office is located in St. Petersburg, Florida; however, the
mailing address is P.O. Box 5068, Clearwater, FL 33758-5068. Western Reserve's
Administrative Office for this Policy is located at 4333 Edgewood Road NE, Cedar
Rapids, Iowa 52499.

Western Reserve is a wholly-owned subsidiary of First AUSA Life Insurance
Company ("First AUSA"), a stock life insurance company which is a wholly-owned
indirect subsidiary of AEGON USA, Inc. ("AEGON USA"). AEGON USA is a financial
services holding company whose primary emphasis is on life and health insurance
and annuity and investment products. AEGON USA is a wholly-owned indirect
subsidiary of AEGON N.V., a Netherlands corporation, which is a publicly traded
international insurance group.

IMSA. We are a member of the Insurance Marketplace Standards Association
("IMSA"). IMSA is an independent, voluntary organization of life insurance
companies. IMSA promotes high ethical standards in the sales and advertising of
individual life insurance and annuity products. Companies must undergo a
rigorous self and independent assessment of their practices to become a member
of IMSA. The IMSA logo in our sales literature shows our ongoing commitment to
these standards.

PUBLISHED RATINGS. Western Reserve may from time to time publish in
advertisements, sales literature and reports to Owners, the ratings and other
information assigned to it by one or more independent rating organizations such
as A.M. Best Company ("A.M. Best"), Moody's Investors Service, Inc. ("Moody's"),

17
<PAGE> 20

Standard & Poor's Insurance Rating Services ("Standard & Poor's"), and Duff &
Phelps Credit Rating Co. ("Duff & Phelps"). A.M. Best's, Standard and Poor's and
Moody's ratings reflect their current opinion of the relative financial strength
and operating performance of an insurance company in comparison to the norms of
the life/health insurance industry. Duff & Phelps' rating measures the
claims-paying ability of insurance companies. These ratings are opinions of an
operating insurance company's financial capacity to meet the obligations of its
insurance policies in accordance with their terms and should not be considered
as bearing on the investment performance of assets held in the Separate Account.
Claims-paying ability ratings do not refer to an insurer's ability to meet
non-policy obligations (i.e., debt/commercial paper). The ratings also do not
relate to the performance of the Portfolios.

THE SEPARATE ACCOUNT

Western Reserve established WRL Series Life Corporate Account (the
"Separate Account") as a separate account on December 8, 1997. The Separate
Account meets the definition of a "separate account" under the Federal
securities laws and its fiscal year ends on December 31. The Separate Account
will receive and invest the Net Premiums paid under this Policy.

The assets of the Separate Account are the property of Western Reserve. The
Code of Ohio, under which Western Reserve established the Separate Account,
provides that the assets in the Separate Account attributable to the Policies
are not chargeable with liabilities arising out of any other business which
Western Reserve may conduct. The assets of the Separate Account shall, however,
be available to cover the liabilities of the General Account of Western Reserve
to the extent that the Separate Account's assets exceed its liabilities arising
under the Policies.

The Separate Account is currently divided into Subaccounts. Each Subaccount
invests exclusively in shares of a single Portfolio. Income and both realized
and unrealized gains or losses from the assets of each Subaccount of the
Separate Account are credited to or charged against that Subaccount without
regard to income, gains or losses from any other Subaccount of the Separate
Account or arising out of any other business Western Reserve may conduct.

Where permitted by applicable law, Western Reserve may make the following
changes to the Separate Account:

1. Any changes required by the 1940 Act or other applicable law or
regulation;

2. Combine separate accounts, including the Separate Account;

3. Add new subaccounts to or remove existing subaccounts from the
Separate Account or combine Subaccounts;

4. Make Subaccounts (including new subaccounts) available to such
classes of Policies as Western Reserve may determine;

5. Add new portfolios or remove existing Portfolios;

6. Substitute new portfolios for any existing Portfolios if shares of
the Portfolio are no longer available for investment or if Western
Reserve determines that investment in a Portfolio is no longer
appropriate in light of the purposes of the Separate Account;

7. Deregister the Separate Account under the 1940 Act if such
registration is no longer required; and

8. Operate the Separate Account as a management investment company
under the 1940 Act or as any other form permitted by law.

Western Reserve will not make any such changes without any necessary
approval of the SEC and applicable state insurance departments. Western Reserve
will notify Owners of any changes.

INVESTMENTS OF THE SEPARATE ACCOUNT. The Subaccounts of the Separate
Account invest in shares of the corresponding Portfolios. Each Portfolio is part
of a series mutual fund which is registered with the SEC as an open-end
diversified management investment company. Such registration does not involve
supervision of the management or investment practices or policies of the
Portfolios by the SEC.

The assets of each Portfolio are held separate from the assets of the other
Portfolios, and each Portfolio has investment objectives and policies which are
different from those of the other Portfolios. Thus, each Portfolio operates as a
separate investment fund, and the income or losses of one Portfolio generally
have no

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<PAGE> 21

effect on the investment performance of any other Portfolio. Certain Subaccounts
and corresponding Portfolios may not be available to residents of some states.

The paragraphs below summarize each Portfolio's investment objectives and
policies. There is no assurance that any of the Portfolios will achieve its
stated objective. The information below also identifies the investment adviser
(and, where applicable, the investment sub-adviser) to each Portfolio. More
detailed information, including a description of risks, can be found in the
prospectuses for the Portfolios which should be read carefully.

DEUTSCHE ASSET MANAGEMENT
VIT FUNDS (formerly BT
Insurance Funds Trust)
(managed by Bankers Trust
Company) - SMALL CAP INDEX seeks to replicate, as closely as
possible (before deduction of expenses), the return
of the Russell 2000 Small Stock Index ("Russell
2000(R)"), an index consisting of 2,000
small-capitalization common stocks. This Portfolio
will include the common stock of companies included
in the Russell 2000, on the basis of
computer-generated statistical data, that are deemed
representative of the industry diversification of
the entire Russell 2000.

- EQUITY 500 INDEX seeks to replicate, as closely as
possible (before deduction of expenses), the total
return of the Standard & Poor's 500 Composite Stock
Price Index ("S&P 500(R)"), an index emphasizing
large-capitalization stocks. This Portfolio will
include the common stock of those companies included
in the S&P 500 selected on the basis of computer
generated statistical data, that are deemed
representative of the industry diversification of
the entire S&P 500.

- EAFE(R) EQUITY INDEX seeks to replicate, as closely
as possible (before deduction of expenses), the
total return of the MSCI Europe, Australia, Far East
Index (the "EAFE(R) Index"), a
capitalization-weighted index containing
approximately 1,100 equity securities of companies
located outside the United States.

FIDELITY VARIABLE INSURANCE
PRODUCTS FUNDS -- INITIAL
CLASS
(managed by Fidelity
Management & Research
Company) - GROWTH OPPORTUNITIES seeks to provide capital
growth.
- CONTRAFUND(R) seeks long-term capital appreciation.
- GROWTH seeks to achieve capital appreciation.
- BALANCED seeks both income and growth of capital.
- HIGH INCOME seeks a high level of current income
while also considering growth of capital.
- MONEY MARKET seeks as high a level of current income
as is consistent with preservation of capital and
liquidity.

PIMCO VARIABLE INSURANCE
TRUST (managed by Pacific
Investment Management
Company) - SHORT-TERM BOND seeks to obtain maximum current
income consistent with preservation of capital and
daily liquidity.

- TOTAL RETURN BOND seeks to maximize total return,
consistent with preservation of capital and prudent
investment management.
- STOCKSPLUS GROWTH AND INCOME seeks to achieve a
total return which exceeds the total return
performance of the S&P 500.

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<PAGE> 22

T. ROWE PRICE EQUITY
SERIES,
INC. (managed by T. Rowe
Price Associates, Inc.) - T. ROWE PRICE MID-CAP GROWTH seeks to provide
long-term capital appreciation by investing in
mid-cap stocks with potential for above-average
earnings growth.

- T. ROWE PRICE EQUITY INCOME seeks to provide
substantial dividend income as well as long-term
growth of capital through investments in the common
stocks of established companies.

- T. ROWE PRICE NEW AMERICA GROWTH seeks to provide
long-term growth of capital by investing primarily
in the common stocks of companies operating in
sectors T. Rowe Price believes will be the fastest
growing in the United States.

T. ROWE PRICE INTERNATIONAL
SERIES, INC. (managed by
Rowe
Price-Fleming
International,
Inc.) - T. ROWE PRICE INTERNATIONAL STOCK seeks long-term
growth of capital through investments primarily in
the common stocks of established, non-U.S.
companies.
JANUS ASPEN SERIES (managed
by Janus Capital
Corporation) - GROWTH seeks long-term growth of capital in a manner
consistent with the preservation of capital. It
pursues its objective by investing primarily in
common stocks selected for their growth potential.
Although the Portfolio can invest in companies of
any size, it generally invests in larger, more
established companies.
- CAPITAL APPRECIATION seeks long-term growth of
capital. It pursues its objective by investing
primarily in common stocks selected for their growth
potential. The Portfolio may invest in companies of
any size, from larger, well established companies to
smaller, emerging growth companies.
- WORLDWIDE GROWTH seeks long-term growth of capital
in a manner consistent with the preservation of
capital. It pursues its objective by investing
primarily in common stocks of companies of any size
throughout the world. The Portfolio normally invests
in issuers from at least five different countries,
including the United States. The Portfolio may at
times invest in fewer than five countries or even a
single country.
- HIGH YIELD seeks to obtain high current income.
Capital appreciation is a secondary objective when
consistent with its primary objective. It pursues
its objectives by normally investing 65% of its
assets in high-yield/high-risk fixed-income
securities, and may at times invest all of its
assets in these securities.

INVESCO VARIABLE
INVESTMENT FUNDS, INC.
(managed by INVESCO Funds
Group, Inc.) - INVESCO VIF -- BLUE CHIP GROWTH seeks to buy
securities that will increase in value over the
long-term by investing primarily in common stocks of
large companies with market capitalizations of more
than $15 billion that have a history of consistent
earnings growth regardless of the business cycle.
Current income is a secondary goal.

- INVESCO VIF -- DYNAMICS seeks to buy securities that
will increase in value over the long-term by
investing in a variety of securities that the
investment adviser believes present opportunities
for capital growth -- primarily common stocks of
companies traded on U.S. securities exchanges, as
well as over-the-counter. The Fund also may invest
in preferred stocks and debt instruments that are
convertible into common stocks, as well as in
securities of foreign companies.

20
<PAGE> 23

INVESCO VARIABLE
INVESTMENT FUNDS, INC.
(managed by INVESCO Funds
Group, Inc.)
(continued) - INVESCO VIF -- FINANCIAL SERVICES invests primarily
in equity securities of companies involved in the
financial services sector (e.g., banks, insurance
companies, and investment and miscellaneous
industries) that the investment adviser believes
will rise in price -- and increase in
value -- faster than other investments, as well as
options and other investments whose value is based
upon the values of equity securities. The Fund can
also invest in debt securities.

- INVESCO VIF -- HEALTH SCIENCES invests primarily in
equity securities of companies that develop, produce
or distribute health care-related products or
services, that the investment adviser believes will
rise in price faster than other investments, as well
as options and other investments whose value is
based upon the values of equity securities. This
Fund can also invest in debt securities.

- INVESCO VIF -- MARKET NEUTRAL seeks to outperform
the return on three-month U.S. Treasury bills
regardless of the movements of the broad securities
market. The Fund attempts to achieve its investment
objective by using a management style known as
"market neutral." Please refer to the Fund's
prospectus for a description of the market neutral
management style.

- INVESCO VIF -- SMALL COMPANY GROWTH seeks to buy
securities that will increase in value over the long
term. The Fund normally invests at least 65% of its
assets in equity securities of companies with market
capitalizations of $2 billion or less.

- INVESCO VIF -- TECHNOLOGY seeks capital appreciation
and normally invests at least 80% of its total
assets in the equity securities of companies engaged
in technology-related industries. The Fund invests
primarily in equity securities that the investment
adviser believes will rise in price faster than
other investments, as well as options and other
investments whose value is based upon the values of
equity securities. The Fund also can invest in debt
securities.

- INVESCO VIF -- TELECOMMUNICATIONS invests primarily
in the equity securities of companies in the
telecommunications sector that the investment
adviser believes will rise in price -- and increase
in value -- faster than other investments, as well
as options and other investments whose value is
based upon the values of equity securities. The Fund
also can invest in debt securities. Current income
is an additional consideration in the Fund's
investments. The telecommunications sector includes,
among other things, companies that are engaged in
the design, development, manufacture, distribution,
or sale of communications services and equipment.

Shares of certain Portfolios are sold to separate accounts of insurance
companies that may or may not be affiliated with Western Reserve or each other.
In addition, shares of certain Portfolios are also sold to separate accounts to
serve as the underlying investment for both variable life insurance policies and
variable annuity contracts. It is possible that a material conflict may arise
between the interests of Owners of the Policies and owners of other variable
life insurance policies or variable annuity contracts whose accumulation values
are allocated to a Portfolio. Material conflicts could result from, for example,
(1) changes in state insurance laws, (2) changes in Federal income tax laws, or
(3) differences in voting instructions between those given by

21
<PAGE> 24

variable life insurance policy owners and those given by variable annuity
contract owners. Although neither Western Reserve nor the Portfolios currently
foresee any such disadvantages, Western Reserve and each Portfolio's Board of
Directors intend to monitor events in order to identify any material conflicts
and to determine what action to take. Such action could include the sale of
Portfolio shares by one or more of the separate accounts, which could have
adverse consequences. If the Board of Directors were to conclude that separate
funds should be established for variable life and variable annuity separate
accounts, Western Reserve will bear the attendant expenses, but variable life
insurance policy owners and variable annuity contract owners would no longer
have the economies of scale resulting from a larger combined fund.

The investment objectives and policies of certain Portfolios are similar to
the investment objectives and policies of other portfolios that the same
investment adviser, sub-investment adviser, or manager may manage. The
investment results of the Portfolios may be higher or lower than the results of
such other portfolios. There can be no assurance, and Western Reserve makes no
representation, that the investment results of any of the Portfolios will be
comparable to the investment results of any other portfolio, even if the other
portfolio has the same investment adviser, sub-investment adviser, or manager.

FACTS ABOUT THE POLICY

AVAILABILITY OF THE POLICY

Under Western Reserve's current rules, Western Reserve will offer the
Policy to corporations and partnerships that meet the following conditions at
issue:

- a minimum of five (5) Policies are issued, each on the life of a
different Insured; or

- the aggregate annualized first-year planned periodic premium for all
Policies is at least $100,000.

APPLYING FOR A POLICY

To purchase a Policy, Western Reserve must receive a completed application
at the Administrative Office. Under Western Reserve's current rules, the minimum
Face Amount of a Policy is generally $25,000. Western Reserve will generally
issue Policies to Insureds who supply satisfactory evidence of insurability
sufficient to Western Reserve. Acceptance is subject to Western Reserve's
underwriting rules and Western Reserve reserves the right to reject an
application for any reason permitted by law.

FREE-LOOK PERIOD

An Owner may cancel a Policy for a refund during the "free-look period" by
returning it to Western Reserve or to the sales representative who sold it. The
free-look period expires 20 days after delivery of the Policy. Certain states
may require a free-look period longer than 20 days. If you decide to cancel the
Policy, Western Reserve will treat the Policy as if it had never been issued.
Within seven calendar days after receiving the returned Policy, Western Reserve
will refund an amount equal to the greater of the Cash Value as of the date the
Policy is returned, or the premiums paid less any partial withdrawals. Under
ordinary circumstances, the refunded amount will be the premiums paid less
partial withdrawals.

PREMIUMS

PREMIUM FLEXIBILITY. Owners are not required to adhere to any rigid and
inflexible premium schedule. Western Reserve may require the Owner to pay an
initial premium. Thereafter, up to age 100 and subject to the maximum premium
limitations described below, an Owner may make unscheduled premium payments at
any time in any amount. When making premium payments during the first Policy
Year, an Owner should consider the effect of the sales charge (since Western
Reserve deducts a lower percentage of each premium received in excess of the
Target Premium during the first Policy Year than in subsequent Policy Years),
and the deferred sales charge (because Western Reserve deducts this charge based
on a percentage of premiums paid in the first year). See Charges and
Deductions -- Percent of Premium Load; and Deferred Sales Charge.

PLANNED PERIODIC PREMIUMS. Each Owner will determine a Planned Periodic
Premium schedule that provides for the payment of a level premium at a fixed
interval over a specified period of time. The Owner is

22
<PAGE> 25

not required to pay premiums in accordance with this schedule. Furthermore, the
Owner has considerable flexibility to alter the amount, frequency, and the time
period over which Planned Periodic Premiums are paid.

The payment of a Planned Periodic Premium will not guarantee that the
Policy remains in force. Instead, the duration of the Policy depends upon the
Policy's Net Cash Value. Thus, even if Planned Periodic Premiums are paid by the
Owner, the Policy will nonetheless lapse any time Net Cash Value is insufficient
to pay certain monthly charges, and a Late Period expires without a sufficient
payment being made.

PREMIUM LIMITATIONS. In no event may the total of all premiums paid, both
scheduled and unscheduled, exceed the current maximum premium limitations which
qualify the Policy as life insurance according to Federal tax laws. If you pay a
premium which would result in total premiums exceeding the current maximum
premium limitation, Western Reserve will only accept that portion of the premium
which will make total premiums equal the maximum. Western Reserve will return
any part of the premium in excess of that amount, and will not accept any
further premiums until allowed by the current maximum premium limitations set
forth under Federal tax laws.

PAYMENT OF PREMIUMS. Any payment made by check or money order must be
payable to Western Reserve Life Assurance Co. of Ohio. Western Reserve will
treat payments made by the Owner as a premium payment unless clearly marked as
loan repayments. Western Reserve will deduct certain charges from each premium
payment. (See Charges and Deductions, p. 31.) As an accommodation to Owners,
Western Reserve will accept transmittal of initial and subsequent premiums of at
least $1,000 by wire transfer. For an initial premium, the wire transfer must be
accompanied by a simultaneous telephone facsimile transmission ("fax") of a
completed application. An initial premium accepted via wire transfer with fax
will be allocated in accordance with current procedures explained in the section
entitled Allocation of Net Premiums and Cash Value -- Allocation of Net
Premiums. An initial premium made by wire transfer not accompanied by a
simultaneous fax, or accompanied by a fax of an incomplete application will be
applied at the unit value next determined not later than two business days after
receipt of an appropriate fax or a complete application. However, if Western
Reserve cannot obtain the fax or essential information within five business
days, Western Reserve shall inform the applicant of the reasons for the delay,
and will return the initial premium to the applicant unless the applicant
specifically consents to allow Western Reserve to retain the initial premium
until the required fax or essential information is received.

If Western Reserve later receives the application with original signature
and the allocation instructions in that application, for any reason, are
inconsistent with those previously designated on the fax, Western Reserve will
reallocate the initial premium on the first Valuation Day on or following the
date the Policy is issued, in accordance with the allocation instructions in the
application with original signature.

Owners wishing to make payments via bank wire should instruct their banks
to wire Federal Funds as follows: .

ALLFIRST

ABA #052000113
For credit to account of Western Reserve #89487643
Include your name and Policy number on all correspondence.

POLICY LAPSE AND REINSTATEMENT

LAPSE. The failure to make a Planned Periodic Premium payment will not
itself cause the Policy to Lapse. Lapse will only occur where Net Cash Value is
insufficient to cover the monthly deduction, and a Late Period expires without
the Owner making a sufficient payment. If the Net Cash Value is insufficient to
cover the monthly deduction, the Owner must pay during the Late Period a payment
at least sufficient to provide a Net Premium to cover the sum of the monthly
deductions due within the Late Period. Such a lapse could happen if the
investment experience has been sufficiently unfavorable to have resulted in a
decrease in the Net Cash Value, or the Net Cash Value has decreased because not
enough premiums have been paid to offset the monthly charges.

If Net Cash Value is insufficient to cover the monthly deduction, Western
Reserve will notify the Owner and any assignee of record of the minimum payment
needed to keep the Policy in force. The Owner will then

23
<PAGE> 26

have a Late Period of 62 days, measured from the date notice is sent to the
Owner, for Western Reserve to receive sufficient payments. If Western Reserve
does not receive a sufficient payment within the Late Period, the Policy will
lapse. If Western Reserve receives a sufficient payment during the Late Period,
Western Reserve will allocate any resulting Net Premium among the Subaccounts,
and will charge any monthly deductions due to such Subaccounts, in accordance
with the Owner's then current instructions. (See Allocation of Premiums and Cash
Value -- Allocation of Net Premiums, and Charges and Deductions -- Monthly
Deductions.) If the Insured dies during the Late Period, the Life Insurance
Benefit Proceeds will equal the amount of the Life Insurance Benefit Proceeds
immediately prior to the commencement of the Late Period, reduced by any due and
unpaid charges.

REINSTATEMENT. You may reinstate a lapsed Policy any time within five
years after the date of Lapse by submitting the following items to Western
Reserve:

1. A written application for reinstatement from the Owner;

2. Evidence of insurability satisfactory to Western Reserve; and

3. A premium that, after the charges against premiums, is large enough
to cover the next two monthly deductions that will become due after
the time of reinstatement.

Western Reserve reserves the right to decline a reinstatement request. Upon
approval of the application for reinstatement, the effective date of
reinstatement will be the first Monthly Deduction Day on or next following the
date Western Reserve approves the application for reinstatement.

ALLOCATION OF NET PREMIUMS AND CASH VALUE

NET PREMIUMS. The Net Premium equals the premium paid less any applicable
percent of premium load. (See Charges and Deductions -- Percent of Premium
Load). When an initial premium accompanies the application, monthly deductions
from the Cash Value of the Policy commence on the Effective Date.

ALLOCATION OF NET PREMIUMS. In the application for a Policy, the Owner
will allocate Net Premiums to one or more of the Subaccounts of the Separate
Account. Notwithstanding the allocation in the application, the initial premium,
less charges, will be allocated during the free-look period to the General
Account and will earn interest at an annual rate (minimum 4%) declared by
Western Reserve. At the end of the free-look period, Western Reserve allocates
the Net Premium, including interest earned during the free-look period, to the
Subaccounts as directed in the application. Western Reserve deems the Policy to
be delivered four days after it is mailed for the purpose of allocating the Net
Premium (including interest) at the end of the free-look period. (See Facts
About The Policy -- Free-Look Period.)

The minimum percentage of each premium that you may allocate to any
Subaccount is 1%; percentages must be in whole numbers. You may change the
allocation of future Net Premiums without charge at any time by providing
Western Reserve with written notification from the Owner, or by calling the
Administrative Office. Western Reserve will employ the same procedures to
confirm that such telephone instructions are genuine as it employs regarding
telephone instructions for transfers among Subaccounts. (See Transfer
Privileges.) Upon instructions from the Owner, the registered representative or
agent of record may also change the allocation of future Net Premiums. Western
Reserve reserves the right to limit the number of changes to the allocation of
Net Premiums. Investment returns from the amounts allocated to Subaccounts of
the Separate Account will vary with the investment experience of these
Subaccounts and the Owner bears the entire investment risk.

POLICY VALUES

CASH VALUE. The Cash Value serves as the starting point for calculating
certain values under a Policy. The Cash Value is the sum of all Subaccount
Values and the Loan Account Value and therefore varies to reflect the investment
experience of the Subaccounts. Western Reserve determines the Cash Value on the
date the Policy is issued and on each Valuation Day thereafter. The Cash Value
may be more or less than premiums paid. THERE IS NO GUARANTEED MINIMUM CASH
VALUE.

24
<PAGE> 27

NET CASH VALUE. The Net Cash Value is the amount payable on surrender of
the Policy. It is equal to the Cash Value as of the date of surrender minus any
outstanding Indebtedness, plus premium load refund, if applicable.

SUBACCOUNT VALUE. The Subaccount Value of any Subaccount as of the end of
the free-look period is equal to the amount of the initial Net Premium allocated
to that Subaccount (including any interest credited during the free-look
period). On subsequent Valuation Days, the Subaccount Value is equal to that
part of any Net Premium allocated to the Subaccount and any Cash Value
transferred to that Subaccount, adjusted by interest income, dividends, net
capital gains or losses, realized or unrealized, and decreased by partial
withdrawals and any Cash Value transferred out of that Subaccount.

ACCUMULATION UNITS. For each Subaccount, Net Premiums allocated to a
Subaccount or amounts of Cash Value transferred to a Subaccount are converted
into Accumulation Units. Western Reserve determines the number of Accumulation
Units credited to a Policy by dividing the dollar amount of any Net Premium or
transfer directed to each Subaccount by the value of an Accumulation Unit for
that Subaccount on the transaction date. Therefore, Net Premiums allocated to or
amounts transferred to a Subaccount under a Policy increase the number of
Accumulation Units of that Subaccount credited to the Policy.

Certain events reduce the number of Accumulation Units of a Subaccount
credited to a Policy:

- Partial withdrawals or transfers of Subaccount Value from a
Subaccount result in the cancellation of the appropriate number of
Accumulation Units of that Subaccount as do:

- surrender of the Policy;

- payment of the Life Insurance Benefit Proceeds;

- Policy loans; and

- the deduction of the monthly deduction.

Accumulation Units are canceled as of the end of the Valuation Period in
which Western Reserve receives written notice regarding the event. These events
are referred to as "Policy transactions."

Accumulation Units are bought and sold each time there is a Policy
transaction. Western Reserve determines the number of Accumulation Units in any
Subaccount on any day follows:

1. From the Accumulation Units as of the prior Monthly Deduction Day,
subtract the Accumulation Units sold to pay any partial
withdrawals;

2. Add Accumulation Units bought with Net Premiums received since the
prior Monthly Deduction Day;

3. Subtract Accumulation Units sold to transfer amounts into the Loan
Account;

4. Add Accumulation Units bought with loan repayments;

5. Subtract Accumulation Units sold to transfer amounts to other
Subaccounts;

6. Add Accumulation Units bought from amounts transferred from other
Subaccounts.

The number of Accumulation Units on a Monthly Deduction Day is the result
of steps 1 through 6 above, minus the number of Accumulation Units sold to pay
the monthly deduction charge. If the Monthly Deduction Day is a Policy
Anniversary, Western Reserve will increase the number of Accumulation Units by
Accumulation Units bought with any amounts transferred from the Loan Account.

ACCUMULATION UNIT VALUE. Western Reserve determines the value of an
Accumulation Unit on any Valuation Day by multiplying the value of that
Accumulation Unit on the immediately preceding Valuation Day by the Net
Investment Factor for the Valuation Period.

25
<PAGE> 28

NET INVESTMENT FACTOR. The Net Investment Factor is an index applied to
measure the investment performance of Accumulation Units of a Subaccount from
one Valuation Period to the next. Western Reserve determines the Net Investment
Factor for any Subaccount for any Valuation Period by dividing 1 by 2, where:

1. is the result of:

a. the net asset value per share of the Portfolio held in the
Subaccount, determined at the end of the current Valuation
Period; plus

b. the per share amount of any dividend or capital gain
distributions made by the Portfolio held in the Subaccount, if
the "ex-dividend" date occurs during the current Valuation
Period; and

2. is the net asset value per share of the Portfolio held in the
Subaccount, determined at the end of the immediately preceding
Valuation Period.

The Net Investment Factor may be greater or less than one; therefore, the
value of an Accumulation Unit may increase or decrease.

TRANSFER PRIVILEGES

GENERAL. Owners may transfer Cash Value among the Subaccounts. The amount
of Cash Value available for transfer from any Subaccount is determined at the
end of the Valuation Period during which the transfer request is received at the
Administrative Office. The net asset value for each share of the corresponding
Portfolio of any Subaccount is determined, once daily, as of the close of the
regular business session of the New York Stock Exchange ("NYSE") (usually 4:00
p.m. Eastern time), which coincides with the end of each Valuation Period. (See
Policy Benefits -- Cash Value -- Valuation Day and Valuation Period.) Therefore,
any transfer request received after the close of the regular business session of
the NYSE, on any day the NYSE is open, will be processed using the net asset
value for each share of the applicable Portfolio determined as of the close of
the regular business session of the NYSE, on the next day the NYSE is open for
business.

The minimum amount that you may transfer is the lesser of $500 or the value
of all remaining Accumulation Units in a Subaccount, unless Western Reserve
agrees otherwise. The Subaccount from which you make a transfer must maintain a
minimum balance of $500 after the transfer is completed. If the value of the
remaining Accumulation Units in a Subaccount would be less than $500, Western
Reserve has the right to include that amount as part of the transfer.

Owners may make up to 12 transfers of Cash Value without charge during any
one Policy Year. After these 12 transfers in a Policy Year, Western Reserve
reserves the right to impose a charge of $25 for each subsequent transfer.
Western Reserve will not increase the transfer charge. Western Reserve will
consider all transfers made in any one day a single transfer and will deduct any
transfer charges on a pro-rata basis from each Subaccount from which a transfer
was made. Transfers resulting from Policy loans, the exercise of exchange
privileges, and the reallocation of Cash Value immediately after the free-look
period, will not be treated as a transfer for the purpose of this charge.

Owners may make transfer requests in writing, or by telephone. Written
requests must be in a form acceptable to Western Reserve. The registered
representative or agent of record for the Policy may, upon instructions from the
Owner for each transfer, make telephone transfers upon request without the
necessity for the Owner to have previously authorized telephone transfers in
writing. Transfer requests made by telephone must be verified by a facsimile
sent to the Administrative Office before the transfer is made. If, for any
reason, an Owner does not want the ability to make transfers by telephone, the
Owner should provide written notice to Western Reserve at the Administrative
Office. All telephone transfers should be made by calling the Administrative
Office.

Western Reserve will not be liable for complying with telephone
instructions it reasonably believes to be authentic, nor for any loss, damage,
cost or expense in acting on such telephone instructions, and Owners will bear
the risk of any such loss. Western Reserve will employ reasonable procedures to
confirm that telephone instructions are genuine. If Western Reserve does not
employ such procedures, it may be liable for losses due to unauthorized or
fraudulent instructions. Such procedures may include, among others, requiring
forms of

26
<PAGE> 29

personal identification prior to acting upon such telephone instructions,
providing written confirmation of such transactions to Owners, and/or tape
recording telephone instructions received from Owners.

Western Reserve may, at any time, revoke or modify the transfer privilege.
Under Western Reserve's current procedures, it will effect transfers and
determine all values in connection with transfers at the end of the Valuation
Period during which the transfer request is received at the Administrative
Office.

ASSET REBALANCING PROGRAM. Western Reserve offers a program under which
the Owner may authorize Western Reserve to transfer Cash Value periodically to
maintain a particular percentage allocation among the Subaccounts. The Cash
Value allocated to each Subaccount will grow or decline in value at different
rates. The asset rebalancing program automatically reallocates the Cash Value in
the Subaccounts at the end of each period to match the Policy's currently
effective Net Premium allocation schedule. The asset rebalancing program is
intended to transfer Cash Value from those Subaccounts that have increased in
value to those Subaccounts that have declined in value. Over time, this method
of investing may help an Owner buy low and sell high. This investment method
does not guarantee gains, nor does it assure that any Subaccount will not have
losses.

To qualify for the asset rebalancing program, a minimum Cash Value of
$10,000 for an existing Policy, or a minimum initial premium of $10,000 for a
new Policy, is required. To participate in the asset rebalancing program, a
properly completed asset rebalancing request form, which is available upon
request, must be received by Western Reserve.

Owners may elect rebalancing to occur on each quarterly, semi-annual or
annual anniversary of the Effective Date. Following receipt of the asset
rebalancing request form, Western Reserve will effect the initial rebalancing of
Cash Value on the next such anniversary, in accordance with the Policy's current
Net Premium allocation schedule. The amounts transferred will be credited at the
unit value next determined on the dates the transfers are made. If a day on
which rebalancing would ordinarily occur falls on a day on which the NYSE is
closed, rebalancing will occur on the next day the NYSE is open.

There is no charge for the asset rebalancing program. Any reallocation
which occurs under the asset rebalancing program will not be counted towards the
12 free transfers allowed during each Policy Year.

The Owner may terminate participation at any time in the asset rebalancing
program by oral or written request to Western Reserve. Participating in the
asset rebalancing program will terminate automatically if any transfer is made
to, or from, any Subaccount, other than on account of a scheduled rebalancing.
If the Owner wishes to resume the asset rebalancing program after it has been
canceled, a new asset rebalancing request form must be completed and sent to
Western Reserve. The Owner may start and stop participation in the asset
rebalancing program at any time; however, Western Reserve reserves the right to
restrict entry into the asset rebalancing program to once per Policy Year.

Western Reserve may discontinue, modify, or suspend, the asset rebalancing
program at any time.

SURRENDERS AND PARTIAL WITHDRAWALS

SURRENDERS. At any time while the Insured is still living and the Policy
is in force, the Owner may, by written request, surrender the Policy for its Net
Cash Value (which is the Cash Value less any Indebtedness, plus refund of
premium load, if applicable). A surrender is effective as of the date on which a
written request for surrender is received by Western Reserve. If the Owner
surrenders the Policy during the first three Policy Years, Western Reserve will
refund a portion of the Percent of Premium Load charged against the premium
payments made in the Policy Year of the surrender. Western Reserve will refund
6.0% of the premium paid up to the Target Premium and 3.0% of the premium paid
in excess of the Target Premium. (See Charges and Deductions -- Percent of
Premium Load, p. 34.) Once the Policy is surrendered, all coverage and other
benefits under it cease and it cannot be reinstated. A surrender may have tax
consequences. (See Federal Tax Considerations, p. 40.)

PARTIAL WITHDRAWALS. After the first Policy Year, while the Insured is
still living and the Policy is in force, an Owner may apply for a partial
withdrawal. The request must be made in writing to the Administrative Office and
the amount requested must be at least $500. The maximum amount that may be
requested is the amount that would leave at least $500 remaining in the
Subaccount from which the partial

27
<PAGE> 30

withdrawal is made. The amount withdrawn is deducted from each of the
Subaccounts on a pro rata basis unless you specify otherwise in a written notice
to the Administrative Office. Western Reserve generally will pay a partial
withdrawal request within seven days following the Valuation Day the request is
received.

There is no limit on the number of partial withdrawals that may be made
during a Policy Year. On each partial withdrawal, Western Reserve imposes a
processing charge equal to the lesser of $25 or 2% of the amount requested.
Western Reserve deducts this charge on a pro-rata basis from each of the
Subaccounts unless you provide other written instructions to the Administrative
Office.

If the Owner has selected Life Insurance Benefit Option 1, Western Reserve
will reduce the Face Amount by the amount of the partial withdrawal. If Life
Insurance Benefit Option 2 is in effect, the Face Amount will not be changed by
the amount of the partial withdrawal. If Life Insurance Benefit Option 3 is in
effect and the partial withdrawal is greater than the sum of the premiums paid,
the Face Amount is reduced by the amount of the partial withdrawal minus the sum
of the premiums paid; otherwise the Face Amount is not reduced. Western Reserve
may reject any partial withdrawal if it would cause the Policy to fail to
qualify as a life insurance contract under the Code or regulations or rulings
thereunder. A partial withdrawal may have tax consequences. (See Federal Tax
Considerations, p. 40.)

LOANS

After the first Policy Year as long as the Policy remains in force, the
Owner may borrow money from Western Reserve using the Policy as the only
security for the loan. Western Reserve permits a Policy loan prior to the first
Policy Anniversary for Policies issued pursuant to a transfer of cash values
from another life insurance policy under Section 1035(a) of the Code. The
maximum amount that may be borrowed is 90% of the Cash Value, less any already
outstanding Policy loan. Western Reserve reserves the right to limit the amount
of any Policy loan to not less than $500. Outstanding loans have priority over
the claims of any assignee or other person. The loan may be repaid totally or in
part. A loan which is taken from, or secured by, a Policy may have Federal
income tax consequences. (See Federal Tax Considerations, p. 40.)

When you request a loan, Western Reserve will withdraw an amount equal to
the requested loan amount plus interest in advance for one year from each of the
Subaccounts on a pro-rata basis, unless you specify otherwise in a written
notice to the Administrative Office, and transfer this amount to the Loan
Account until the loan is repaid.

Western Reserve normally will pay the amount of the loan within seven days
after receipt of a proper request in a manner permitted by Western Reserve.
Postponement of loans may take place under certain conditions. Under Western
Reserve's current procedures, at each Policy Anniversary, Western Reserve will
compare the amount of the outstanding loan (including loan interest in advance
until the next Policy Anniversary, if not paid) to the amount in the Loan
Account (including interest credited to the Loan Account during the previous
Policy Year). Western Reserve will also make this comparison any time the Owner
repays all of the loan, or makes a request to borrow an additional amount. At
each such time, if the amount of the outstanding loan exceeds the amount in the
Loan Account, Western Reserve will withdraw the difference from the Subaccounts
and transfer it to the Loan Account in the same manner as when a loan is made.
If the amount in the Loan Account exceeds the amount of the outstanding loan,
Western Reserve will withdraw the difference from the Loan Account and transfer
it to the Subaccounts in the same manner as current Net Premiums are allocated.
No charge will be imposed for these transfers, and these transfers are not
treated as transfers in calculating the transfer charge.

INTEREST RATE CHARGED. The guaranteed annual interest rate on a Policy
loan is 6.0% and is due on each Policy Anniversary for the prior Policy Year and
on the day the loan is repaid. The current annual interest rate on a Policy loan
is 4.35% in all Policy Years. Loan interest that is unpaid when due will be
added to the amount of the loan and will bear interest at the same rate. On the
date of the Insured's death, the date the Policy ends, the date of a loan
repayment, or any other date Western Reserve specifies, any necessary adjustment
will be made in the loan to reflect any interest accrued since the last Policy
Anniversary. If an

28
<PAGE> 31

annual interest rate lower than 6% is set, any subsequent increase in the
interest rate shall be subject to the following conditions:

(1) The effective date of any increase in the interest rate for Policy
loans shall not be earlier than one year after the effective date
of the establishment of the previous rate.

(2) The amount by which the interest rate may be increased shall not
exceed 1% per year, but the maximum annual interest rate will be
6%.

(3) Western Reserve will give notice of the interest rate in effect
when a loan is made and when sending notice of loan interest due.

(4) If a loan is outstanding 40 days or more before the effective date
of an increase in the annual interest rate, Western Reserve will
notify you of that increase at least 30 days prior to the
effective date of the increase.

(5) Western Reserve will give notice of any increase in the annual
interest rate whenever a loan is made during the 40 days before
the effective date of the increase.

LOAN ACCOUNT INTEREST RATE CREDITED. The amount in the Loan Account will
accrue interest at an effective annual rate of 4%. Western Reserve may credit a
higher rate, but it is not obligated to do so.

EFFECT OF POLICY LOANS. A Policy loan affects the Policy, because the Life
Insurance Benefit Proceeds and Net Cash Value under the Policy are reduced by
the amount of the loan. Repayment of the loan causes the Life Insurance Benefit
Proceeds and Net Cash Value to increase by the amount of the repayment. As long
as a loan is outstanding, an amount equal to the loan plus interest in advance
until the next Policy Anniversary is held in the Loan Account. This amount will
not be affected by the Separate Account's investment performance. Amounts
transferred from the Separate Account to the Loan Account will affect the
Separate Account value because such amounts will be credited with an interest
rate declared by Western Reserve rather than a rate of return reflecting the
investment performance of the Separate Account. There are risks involved in
taking a Policy loan, a few of which include the potential for a Policy to lapse
if projected earnings, taking into account outstanding loans, are not achieved,
as well as possible adverse tax consequences which could occur if a Policy
lapses with loans outstanding.

INDEBTEDNESS. Indebtedness equals the total of all Policy loans plus any
loan interest accrued on the loans. If indebtedness exceeds the Cash Value,
Western Reserve will notify the Owner and any assignee of record. If a
sufficient payment equal to excess indebtedness is not received by Western
Reserve within 31 days from the date notice is sent, the Policy will Lapse and
terminate without value. The Policy, however, may later be reinstated.

REPAYMENT OF INDEBTEDNESS. Indebtedness may be repaid any time. Western
Reserve will treat payments made by the Owner while there is Indebtedness as
premium payments unless the Owner indicates that the payment should be treated
as a loan repayment. If not repaid, Western Reserve may deduct Indebtedness from
any amount payable under the Policy. As Indebtedness is repaid, the Policy's
value in the Loan Account securing the Indebtedness repaid will be transferred
from the Loan Account to the Subaccounts in the same manner as current Net
Premiums are allocated. Western Reserve will allocate the repayment of
Indebtedness at the end of the Valuation Period during which the repayment is
received.

LIFE INSURANCE BENEFITS

GENERAL. Owners designate in the initial application one of three Life
Insurance Benefit Options offered under the Policy: Life Insurance Benefit
Option 1 ("Option 1"), Life Insurance Benefit Option 2 ("Option 2"), and Life
Insurance Benefit Option 3 ("Option 3"). As long as the Policy remains in force,
Western Reserve will, upon receiving due proof of the Insured's death, pay the
Life Insurance Benefit Proceeds of a Policy to the named Beneficiary in
accordance with the designated Life Insurance Benefit Option. Western Reserve
will determine the amount of the Life Insurance Benefit Proceeds payable at the
end of the Valuation Period during which the Insured dies. Western Reserve may
pay the proceeds in a lump sum or under one or more of the settlement options
set forth in the Policy. Western Reserve guarantees that as long as the Policy
remains in force, the Life Insurance Benefit under any option will never be less
than the Face Amount of the Policy until age 100 when the death benefit equals
the Cash Value, but the Life Insurance Benefit Proceeds

29
<PAGE> 32

will reflect reductions for any outstanding Indebtedness and any due and unpaid
charges. These proceeds will be increased by any additional insurance provided
by rider. To qualify the Policy as life insurance under the Code, Owners may
choose between two Life Insurance Benefit Compliance Tests -- either the
Guideline Premium Test or the Cash Value Accumulation Test. Each test involves a
set of limitation percentages that vary by attained age. The limitation
percentages, which are used to determine the Life Insurance Benefit provided,
vary from one test to the other. (See the separate tables below.)

OPTION 1. The Life Insurance Benefit is the greater of the Face Amount of
the Policy or the applicable percentage (the "limitation percentage") times the
Cash Value on the date of death. Accordingly, under Option 1 the Life Insurance
Benefit will remain level unless the limitation percentage times the Cash Value
exceeds the Face Amount, in which case the amount of the Life Insurance Benefit
will vary as the Cash Value varies.

ILLUSTRATION OF OPTION 1. For purposes of this illustration, assume that
the Insured's Attained Age is under 40, that there is no outstanding
indebtedness, and that the Guideline Premium Test is chosen. Under Option 1, a
Policy with a $50,000 Face Amount will generally pay $50,000 in Life Insurance
Benefits. However, because the Life Insurance Benefit must be equal to or be
greater than 250% of Cash Value, any time the Cash Value of the Policy exceeds
$20,000, the Life Insurance Benefit will exceed the $50,000 Face Amount. Each
additional dollar added to Cash Value above $20,000 will increase the Life
Insurance Benefit by $2.50. Similarly, so long as Cash Value exceeds $20,000,
each dollar taken out of Cash Value will reduce the Life Insurance Benefit by
$2.50.

If at any time, however, the Cash Value multiplied by the limitation
percentage is less than the Face Amount, the Life Insurance Benefit will equal
the Face Amount of the Policy.

OPTION 2. The Life Insurance Benefit is equal to the greater of the Face
Amount plus the Cash Value of the Policy or the limitation percentage times the
Cash Value on the date of death. Accordingly, under Option 2 the amount of the
Life Insurance Benefit will always vary as the Cash Value varies.

ILLUSTRATION OF OPTION 2. For purposes of this illustration, assume that
the Insured is under the age of 40, that there is no outstanding indebtedness,
and that the Guideline Premium Test is chosen. Under Option 2, a Policy with a
Face Amount of $50,000 will generally pay a Life Insurance Benefit of $50,000
plus Cash Value. Thus, for example, a Policy with a Cash Value of $10,000 will
have a Life Insurance Benefit of $60,000 ($50,000 + $10,000). The Life Insurance
Benefit under the Guideline Premium Test, however, must be at least 250% of Cash
Value. As a result, if the Cash Value of the Policy exceeds $33,333, the Life
Insurance Benefit will be greater than the Face Amount plus Cash Value. Each
additional dollar of Cash Value above $33,333 will increase the Life Insurance
Benefit by $2.50. Similarly, any time Cash Value exceeds $33,333, each dollar
taken out of Cash Value will reduce the Life Insurance Benefit by $2.50.

If at any time, however, Cash Value multiplied by the limitation percentage
is less than the Face Amount plus the Cash Value, then the Life Insurance
Benefit will be the Face Amount plus the Cash Value of the Policy.

OPTION 3. The Life Insurance Benefit is equal to the greater of the Face
Amount plus cumulative premiums paid less cumulative partial withdrawals, or the
corridor percentage times the Cash Value. Accordingly, under Option 3, the
amount of Life Insurance Benefit will always vary with the premiums paid and
partial withdrawals taken, and may vary as the Cash Value varies.

ILLUSTRATION OF OPTION 3. For purposes of this illustration, assume that
the Insured is under the age of 40, that there is no outstanding indebtedness,
and that the Guideline Premium Test is chosen. Under Option 3, a Policy with a
Face Amount of $50,000 will generally pay a Life Insurance Benefit of $50,000
plus premiums. Thus, for example, a Policy with premiums paid of $10,000 will
have a Life Insurance Benefit of $60,000 ($50,000 + $10,000). The Life Insurance
Benefit under the Guideline Premium Test, however, must be at least 250% of Cash
Value. As a result, if the Cash Value of the Policy exceeds $24,000, the Life
Insurance Benefit will be greater than the Face Amount plus Cash Value. Each
additional dollar of Cash Value above $24,000 will increase the Life Insurance
Benefit by $2.50. Similarly, any time Cash Value exceeds $24,000, each dollar
taken out of Cash Value will reduce the Life Insurance Benefit by $2.50.

30
<PAGE> 33

LIMITATION PERCENTAGES TABLE -- GUIDELINE PREMIUM TEST

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
------------ ----------
<S> <C>
0-40................. 250
41................. 243
42................. 236
43................. 229
44................. 222
45................. 215
46................. 209
47................. 203
48................. 197
49................. 191
50................. 185
51................. 178
52................. 171
53................. 164
54................. 157
55................. 150
56................. 146
57................. 142
58................. 138
</TABLE>

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
------------ ----------
<S> <C>
59................. 134
60................. 130
61................. 128
62................. 126
63................. 124
64................. 122
65................. 120
66................. 119
67................. 118
68................. 117
69................. 116
70................. 115
71................. 113
72................. 111
73................. 109
74................. 107
75................. 105
76................. 105
77................. 105
</TABLE>

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
------------ ----------
<S> <C>
78................. 105
79................. 105
80................. 105
81................. 105
82................. 105
83................. 105
84................. 105
85................. 105
86................. 105
87................. 105
88................. 105
89................. 105
90................. 105
91................. 104
92................. 103
93................. 102
94-99................ 101
100 and older........ 100
</TABLE>

31
<PAGE> 34

LIMITATION PERCENTAGES TABLE -- CASH VALUE ACCUMULATION TEST

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
- --------------------- --------------
MALE FEMALE
---- ------
<S> <C> <C>
20................... 631 751
21................... 612 727
22................... 595 704
23................... 577 681
24................... 560 659
25................... 542 638
26................... 526 617
27................... 509 597
28................... 493 578
29................... 477 559
30................... 462 541
31................... 447 523
32................... 432 506
33................... 418 489
34................... 404 473
35................... 391 458
36................... 379 443
37................... 366 428
38................... 355 414
39................... 343 401
40................... 332 388
41................... 322 376
42................... 312 364
43................... 302 353
44................... 293 342
45................... 284 332
46................... 275 322
</TABLE>

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
- --------------------- --------------
MALE FEMALE
---- ------
<S> <C> <C>
47................... 267 312
48................... 259 303
49................... 251 294
50................... 244 285
51................... 237 276
52................... 230 268
53................... 224 261
54................... 218 253
55................... 212 246
56................... 206 239
57................... 201 232
58................... 195 226
59................... 190 219
60................... 186 213
61................... 181 207
62................... 177 201
63................... 172 196
64................... 168 191
65................... 164 186
66................... 161 181
67................... 157 176
68................... 154 172
69................... 151 167
70................... 148 163
71................... 145 159
72................... 142 155
73................... 140 152
</TABLE>

<TABLE>
<CAPTION>
INSURED'S
ATTAINED AGE
ON POLICY LIMITATION
ANNIVERSARY PERCENTAGE
- --------------------- --------------
MALE FEMALE
---- ------
<S> <C> <C>
74................... 137 148
75................... 135 145
76................... 133 142
77................... 131 139
78................... 129 136
79................... 127 134
80................... 125 131
81................... 124 129
82................... 122 127
83................... 121 125
84................... 119 123
85................... 118 121
86................... 117 119
87................... 116 118
88................... 115 117
89................... 114 115
90................... 113 114
91................... 112 113
92................... 111 111
93................... 110 110
94................... 109 109
95................... 107 108
96................... 106 106
97................... 105 105
98................... 103 103
99................... 102 102
100.................. 100 100
</TABLE>

CHOOSING A LIFE INSURANCE BENEFIT OPTION. As described above and assuming
the Life Insurance Benefit is not determined by reference to the limitation
percentage, Option 1 will provide a Face Amount of Life Insurance Benefit which
does not vary with changes in Cash Value. Thus, under Option 1, as Cash Value
increases, Western Reserve's net amount at risk under the Policy will decline.
In contrast, Option 2 involves a constant net amount at risk, assuming that the
Life Insurance Benefit is not determined by reference to the limitation
percentage. The net amount at risk under the Policy for Option 3 is dependent
upon the amount and timing of premiums paid. Consequently, there is no
generalized pattern as with Options 1 and 2. Therefore, assuming sufficiently
positive investment experience, the deduction for cost of insurance under a
Policy with an Option 1 Life Insurance Benefit will be less than under a
corresponding Policy with an Option 2 or 3 Life Insurance Benefit. Because of
this, if investment performance is positive, Cash Value under Option 1 will
increase faster than under Options 2 or 3 but the total Life Insurance Benefit
under Options 2 or 3 will generally be greater. Thus, Option 1 could be
considered more suitable for Owners whose goal is increasing Cash Value based
upon positive investment experience while Options 2 and 3 could be considered
more suitable for Owners whose goal is increasing total Life Insurance Benefit.

CHANGING THE LIFE INSURANCE BENEFIT OPTION. Generally, the Life Insurance
Benefit Option in effect may be changed by the Owner after the first Policy Year
by sending Western Reserve a written request for change. Western Reserve may
require proof of insurability. A change in Life Insurance Benefit Option may
have Federal income tax consequences. Under Western Reserve's current rules, no
change may be made if it would result in a Face Amount less than the minimum
Face Amount set forth in the Policy, or if the Policy would

32
<PAGE> 35

not continue to qualify as life insurance as defined under Section 7702 of the
Code. The effective date of any change will be the Monthly Deduction Day on or
after Western Reserve approves the request. No charges will be imposed for
making a change in Life Insurance Benefit Option. If the Life Insurance Benefit
Option is changed from Option 2 to Option 1, the Face Amount will be increased
by an amount equal to the Cash Value on the effective date of change. If the
Life Insurance Benefit Option is changed from Option 1 to Option 2, the Face
Amount will be decreased by an amount equal to the Cash Value on the effective
date of the change. If the Life Insurance Benefit Option is changed from Option
3 to Option 1, the Face Amount will be increased by the sum of the premiums paid
less the sum of partial withdrawals. If the Life Insurance Benefit Option is
changed from Option 1 to Option 3, the Face Amount will be decreased by the sum
of the premiums paid less the sum of partial withdrawals. Western Reserve will
not allow changes between Options 2 and 3. Changing the Life Insurance Benefit
Option could have tax consequences. Consult a tax advisor before changing the
Life Insurance Benefit Option.

HOW LIFE INSURANCE BENEFITS MAY VARY IN AMOUNT. As long as the Policy
remains in force, Western Reserve guarantees that the Life Insurance Benefit
will never be less than the Face Amount of the Policy. These proceeds will be
reduced by any outstanding indebtedness and any due and unpaid charges. The Life
Insurance Benefit may, however, vary with the Policy's Cash Value. Under Option
1, the Life Insurance Benefit will only vary when the Cash Value multiplied by
the limitation percentage exceeds the Face Amount of the Policy. The Life
Insurance Benefit under Option 2 will always vary with the Cash Value because
the Life Insurance Benefit equals either the Face Amount plus the Cash Value or
the limitation percentage times the Cash Value. The Life Insurance Benefit under
Option 3 will always vary with the premiums paid and partial withdrawals taken
and will also vary whenever the Cash Value multiplied by the limitation
percentage exceeds the Face Amount plus cumulative premiums paid less cumulative
partial withdrawals.

CHANGING THE FACE AMOUNT. Subject to certain limitations, an Owner may
increase or decrease the Face Amount of a Policy. A change in Face Amount may
affect the net amount at risk, which may affect an Owner's cost of insurance
charge. A change in Face Amount could also have Federal income tax consequences.
Consult a tax advisor before changing the Face Amount.

DECREASES. Any decrease in the Face Amount will become effective on the
Monthly Deduction Day on or following receipt of a written request from the
Owner by Western Reserve at the Administrative Office. No requested decrease in
the Face Amount will be permitted during the first Policy Year. The Face Amount
remaining in force after any requested decrease may not be less than $25,000.
If, following the decrease in Face Amount, the Policy would not comply with the
maximum premium limitations required by Federal tax law, the decrease may be
limited to the extent necessary to meet these requirements.

INCREASES. For an increase in the Face Amount, written application must be
submitted. Western Reserve will also require that additional evidence of
insurability be submitted. Western Reserve reserves the right to decline any
increase request. Any increase will become effective on the Monthly Deduction
Day after Western Reserve approves the request for the increase. No increase in
the Face Amount will be permitted during the first Policy Year. An increase need
not be accompanied by an additional premium, but there must be sufficient Net
Cash Value to cover the next monthly deduction after the increase becomes
effective.

DURATION OF THE POLICY

The Policy's duration depends upon the Net Cash Value. The Policy will
remain in force so long as the Net Cash Value is sufficient to pay the monthly
deduction. If the Net Cash Value is insufficient to pay the monthly deduction,
and a Late Period expires without an adequate payment by the Owner, the Policy
will lapse and terminate without value.

WHEN INSURANCE COVERAGE TAKES EFFECT

No life insurance coverage shall take effect unless the proposed Insured is
alive, in the same condition of health as described in the application when the
Policy is delivered to the Owner, and the full initial premium is paid.

33
<PAGE> 36

PAYMENT OPTIONS

The Policy offers a variety of optional ways of receiving proceeds under
the Policy, other than in a lump sum. Any agent authorized to sell the Policy
can explain these options upon request. None of these options vary with the
investment performance of a separate account.

CHARGES AND DEDUCTIONS

The following charges will apply to your Policy under the circumstances
described. The charges are for the services and benefits provided, costs and
expenses incurred and risks assumed by Western Reserve in connection with the
Policies, some of which are described below.

Services and benefits provided by Western Reserve include:

- the Life Insurance Benefits, cash and loan benefits provided by the
Policy;

- investment options, including Net Premium allocations;

- administration of elective options under the Policy; and

- the distribution of reports to Owners.

Costs and expenses Western Reserve incurs include:

- those associated with underwriting applications and changes in Face
Amount and riders;

- various overhead and other expenses associated with providing the
services and benefits relating to the Policy;

- sales and marketing expenses; and

- other costs of doing business, such as federal, state and local
premium and other taxes and fees.

Risks assumed by Western Reserve include the risks that:

- Insureds may live for a shorter period of time than estimated
resulting in the payment of greater Life Insurance Benefits than
expected; and

- the costs of providing the services and benefits under the Policies
will exceed the charges deducted.

PERCENT OF PREMIUM LOAD

Western Reserve deducts certain expenses at the time you make premium
payments. Western Reserve then allocates the remainder of each premium (the Net
Premium) to the Subaccounts as you direct. The expenses deducted from your
premium are intended to compensate Western Reserve for sales expenses and
federal and state tax charges. Premium tax charges imposed by different states
range from 0.0% to 3.5% of premiums.

During the first Policy Year, Western Reserve deducts 9.5% of each premium
received up to the Target Premium, and 3.0% of each premium received in excess
of the Target Premium. During Policy Years 2-7, Western Reserve deducts 9.5% of
each premium received up to the Target Premium, and 7.5% of each premium
received in excess of the Target Premium. The maximum percent of premium load
deduction is 11.5% of each premium received up to the Target Premium in the
first 7 Policy Years. After Policy Year 7, Western Reserve deducts 4.5% of all
premiums received. Under most circumstances, the Target Premium is the maximum
premium an Owner can pay in a Policy Year without the Policy becoming a Modified
Endowment Contract. Premiums paid in excess of the Target Premium may have
adverse tax consequences. (See Federal Tax Considerations -- Tax Treatment of
Policy Benefits, p. 40.)

Since 3.0% is deducted from each premium in excess of the Target Premium
received by Western Reserve during the first Policy Year, it may be advantageous
to pay such premiums during the first Policy

34
<PAGE> 37

Year rather than after the first Policy Year when a higher percentage is
deducted from premiums in excess of the Target Premium. However, higher premium
amounts paid during the first Policy Year will result in higher amounts being
subject to the deferred sales charge in Policy Years 2 through 7 (See Deferred
Sales Charge, below.) An Owner deciding the appropriate amount and timing of
premium payments should consider the combined effect of the percent of premium
load and the deferred sales charge.

PREMIUM LOAD REFUND AT SURRENDER. If the Owner surrenders the Policy during
the first three Policy Years, Western Reserve will refund a portion of the
Percent of Premium Load charged against the premium payments made in the Policy
Year of surrender. Western Reserve will refund 6.0% of the premium paid up to
the Target Premium and 3.0% of the premium paid in excess of the Target Premium.
The refund only applies to premiums paid in the Policy Year of the surrender,
not to all premiums paid since issue. The refund is available only for
surrenders occurring in the first three Policy Years, and is not available for
partial withdrawals or Policy loans.

DEFERRED SALES CHARGE

On each Policy Anniversary during Policy Years 2 through 7, Western Reserve
currently deducts 1% of the amount of any decrease in excess premium received in
Policy Years 2-7 from the excess premium received in the first Policy Year to
compensate Western Reserve for a portion of Policy sales expenses. If the Policy
is surrendered, this charge is not deducted for Policy Anniversaries not yet
reached. The maximum deferred sales charge is 1.50% in Policy Years 2-7.

MONTHLY DEDUCTIONS

Western Reserve deducts the charges listed below from your Cash Value as of
the Effective Date and on each Monthly Deduction Day. The deductions are made
from the Subaccounts in the same proportion that the Subaccount Value in each
Subaccount bears to the total Cash Value as of the Monthly Deduction Day. The
monthly deduction consists of

(1) a monthly Policy charge,

(2) the monthly cost of insurance charge,

(3) the cost of any supplemental benefits provider by riders, and

(4) a factor representing the mortality and expense risk charge.

MONTHLY POLICY CHARGE. During the first Policy Year, the monthly Policy
charge is $16.50 per month. During subsequent Policy Years, the monthly Policy
charge currently is $4 per month and is guaranteed not to exceed $10 per month.
The monthly Policy charge is paid to Western Reserve for performing
administrative services relating to the Policy.

MONTHLY COST OF INSURANCE CHARGE. The monthly cost of insurance charge
compensates Western Reserve for the anticipated cost of paying the amount of the
Life Insurance Benefit that exceeds your Cash Value upon the death of the
Insured. The cost of insurance charge is calculated monthly, and depends on a
number of variables that cause the charge to vary from Policy to Policy and from
Monthly Deduction Day to Monthly Deduction Day. The cost of insurance charge is
calculated for the Face Amount at issue and for any increase in Face Amount. The
monthly cost of insurance charge is equal to (1) multiplied by the result of (2)
minus (3), where:

(1) is the monthly cost of insurance rate per $1,000 of insurance;

(2) is the number of thousands of Life Insurance Benefit for the Policy
(as defined in the applicable Option 1, Option 2 or Option 3)
divided by 1.0032737; and

(3) is the number of thousands of Cash Value as of the Monthly Deduction
Day (before this cost of insurance, and after the mortality and
expense risk charge, any applicable Policy charge and the cost of
any riders are subtracted).

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The monthly cost of insurance rate for a Policy is based on the sex,
Attained Age, risk class, and number of years that the Policy or increment of
Face Amount has been in force. Western Reserve reviews monthly cost of insurance
rates on an ongoing basis (at least once every year) based on its expectations
as to future mortality experience, investment earnings, persistency, taxes and
other expenses. Any changes in cost of insurance rates are made on a uniform
basis for Insureds of the same class as defined by sex, Attained Age, risk
class, and Policy duration. Western Reserve guarantees that the cost of
insurance rates used to calculate the monthly cost of insurance charge will not
exceed the Guaranteed Maximum Cost of Insurance Rates set forth in the Policy.

In connection with the cost of insurance rates guaranteed in the Policy,
Western Reserve places Insureds into standard tobacco and standard non-tobacco
risk classes. The guaranteed rates for standard classes are based on the 1980
Commissioners' Standard Ordinary Mortality Tables, Male or Female, Tobacco or
Non-Tobacco Mortality Rates ("1980 CSO Tables"). The guaranteed rates for
substandard classes are based on multiples of or additions to the 1980 CSO
Tables. In connection with current cost of insurance rates, Western Reserve
places Insureds into the following risk classes: age, sex, tobacco habit and
health status, medical issue, simplified issue and guaranteed issue.

Cost of insurance rates (whether guaranteed or current) for an Insured in a
non-tobacco class are less than or equal to rates for an Insured of the same age
and sex in a tobacco class. Cost of insurance rates (whether guaranteed or
current) for an Insured in a non-tobacco or tobacco standard class are generally
lower than guaranteed rates for an Insured of the same age and sex and tobacco
status in a substandard class.

Western Reserve does, however, also offer Policies based on unisex
mortality tables if required by state law. Employers and employee organizations
considering purchase of a Policy should consult with their legal advisors to
determine whether purchase of a Policy based on sex-distinct actuarial tables is
consistent with Title VII of the Civil Rights Act of 1964 or other applicable
law. Upon request, Western Reserve may offer Policies with unisex mortality
tables to such prospective purchasers.

SUPPLEMENTAL BENEFIT (RIDER) CHARGES. If any additional benefits are added
to your Policy, Western Reserve will deduct charges for these benefits as part
of the monthly deduction.

MORTALITY AND EXPENSE RISK CHARGE. Western Reserve deducts a monthly
charge from the Cash Value to compensate it for mortality and expense risks that
it assumes under the Policy. In all Policy Years, the monthly charge is
equivalent to an effective annual rate of 0.35%. The charge is calculated as a
percentage of the average Cash Value on each Valuation Day during the Policy
Month preceding the Monthly Deduction Day. The guaranteed rate for this charge
is equivalent to an effective annual rate of 0.90%.

The mortality risk that Western Reserve assumes is the risk that Insureds,
as a group, will live for a shorter period of time than Western Reserve
estimated when it established the guaranteed costs of insurance rates in the
Policy. Because of these guarantees, each Owner is assured that the morbidity of
a particular Insured will not have an adverse effect on the Life Insurance
Benefit Proceeds that a Beneficiary would receive. The expense risk that Western
Reserve assumes is the risk that the monthly Policy charge (and any transfer
charge imposed) may be insufficient to cover the actual expenses of
administering the Policies. Western Reserve may make a profit from the mortality
and expense risk charge, and may use such profit for any lawful purpose
including paying distribution expenses.

ADMINISTRATIVE CHARGES

PARTIAL WITHDRAWAL CHARGE. After the first Policy Year, you may apply for
a partial withdrawal. On each partial withdrawal, Western Reserve imposes a
processing charge equal to the lesser of $25 or 2% of the amount requested.
Western Reserve deducts this charge on a pro-rata basis from the Subaccounts
unless you provide other instructions.

TRANSFER CHARGE. The first 12 transfers during each Policy Year are free.
Western Reserve reserves the right to assess a transfer charge of $25 for each
transfer in excess of 12 during a Policy Year. For the purposes of assessing the
transfer charge, each written request of transfer is considered to be one
transfer, regardless of the number of Subaccounts affected by the transfer.
Western Reserve deducts the transfer charge from the

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amount being transferred. Transfers due to automatic asset rebalancing, loans or
the expiration of the free-look period do not count as transfers for the purpose
of assessing this charge.

PORTFOLIO EXPENSES

The value of the net assets of each Subaccount reflects the investment
advisory fees and other expenses incurred by the corresponding Portfolio in
which the Subaccount invests. See the prospectuses for the Portfolios and the
Summary of this prospectus for further information on these fees and expenses.

OTHER POLICY PROVISIONS AND BENEFITS

OWNERSHIP

GENERAL. The Policy belongs to the Owner named in the application. An
Owner may exercise all of the rights and options described in the Policy. The
Insured is the Owner unless the application specifies a different person as
Owner.

CHANGING THE OWNER. The Owner may change the Owner by providing written
notice to Western Reserve at any time while the Insured is alive and the Policy
is in force. A change of ownership is effective as of the date that the written
notice is signed; however, Western Reserve is not liable for payments it makes
before it receives a written notice of a change in ownership. Changing the Owner
does not automatically change the Beneficiary. A change in Owner may have
significant tax consequences. You should consult a tax advisor before changing
an Owner.

SELECTING THE BENEFICIARY. The Owner designates the Beneficiary in the
application. Any Beneficiary designation is revocable unless otherwise stated in
the designation. Where more than one Beneficiary is designated, each Beneficiary
shares in any Life Insurance Benefit Proceeds equally unless the Beneficiary
designation states otherwise.

CHANGING THE BENEFICIARY. The Owner may change the Beneficiary by
providing a written notice to Western Reserve at any time while the Insured is
alive and the Policy is in force. Any change of Beneficiary is effective as of
the date the written notice is signed by the Owner but Western Reserve is not
liable for any payments it makes under the Policy prior to the time it receives
written notice of any Beneficiary change.

ASSIGNMENT

While the Insured is living, the Owner may assign his or her rights under
this Policy. Western Reserve is not bound by the assignment unless it receives a
duplicate of the original assignment at the Administrative Office. Western
Reserve is not responsible for the validity or sufficiency of any assignment and
is not liable for any payment it makes before receipt of the duplicate original
assignment. The Owner will maintain any rights of ownership that have not been
assigned. An assignee may not change the Owner or the Beneficiary, and may not
elect or change an optional method of payment. Any amount payable to the
assignee will be paid in one sum. Any claim under any assignment is subject to
proof of interest and the extent of the assignment. An assignment is subject to
any Loan Amount.

WESTERN RESERVE'S RIGHT TO CONTEST THE POLICY

Western Reserve has the right to contest the validity of the Policy or to
resist a claim under it on the basis of any material misrepresentation of a fact
stated in the application or any supplemental application. Western Reserve also
has the right to contest the validity of any increase of Face Amount or other
change to the Policy on the basis of any material misrepresentation of a fact
stated in the application (or supplemental application) for such increase in
coverage or change. In issuing this Policy, Western Reserve relies on all
statements made by or for the Insured in the application or in a supplemental
application. In the absence of fraud, Western Reserve considers statements made
in the application(s) to be representations and not warranties.

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In the absence of fraud, Western Reserve cannot bring any legal action to
contest the validity of the Policy after it has been in force during the
lifetime of the Insured for two years from the Effective Date, or if reinstated,
for two years from the date of reinstatement. Likewise, Western Reserve cannot
contest any increase in coverage effective after the Effective Date, or any
reinstatement thereof, after such increase or reinstatement has been in force
during the lifetime of the Insured for two years from its effective date.

SUICIDE EXCLUSION

If the Insured commits suicide, while sane or insane, within two years of
the Effective Date, Western Reserve's liability is limited to an amount equal to
the premiums paid, less any indebtedness and less any partial withdrawals paid.
Western Reserve will pay this amount to the Beneficiary in one sum.

If the Insured commits suicide, while sane or insane, within two years from
the effective date of any increase in Face Amount or additional coverage rider,
Western Reserve's liability with respect to that increase is limited to an
amount equal to the cost of insurance attributable to the increase from the
effective date of the increase to the date of death.

MISSTATEMENT OF AGE OR SEX

If the age or sex of the Insured has been stated incorrectly in the
application or any supplemental application, Western Reserve will adjust the
Life Insurance Benefit and any benefits provided by rider or endorsement it pays
under this Policy to the amount that would have been payable at the correct age
and sex based on the most recent deduction for cost of insurance and the cost of
any benefits provided by rider or endorsement. If the age of the Insured has
been overstated or understated, Western Reserve will calculate future monthly
deductions using the cost of insurance (and the cost of benefits provided by
rider or endorsement) based on the Insured's correct age and sex.

MODIFICATION OF THE POLICY

Only the President, one of the Vice Presidents, Secretary or an officer of
Western Reserve may modify this Policy or waive any of Western Reserve's rights
or requirements under this Policy. Any modification or waiver must be in
writing. No agent may bind Western Reserve by making any promise not contained
in this Policy.

Upon notice to the Owner, Western Reserve may modify the Policy to:

1. conform the Policy, Western Reserve's operations, or the Separate
Account's operations to the requirements of any law (or regulation
issued by a government agency) to which the Policy, Western Reserve
or the Separate Account is subject;

2. assure continued qualification of the Policy as a life insurance
contract under the Code; or

3. reflect a change (permitted by the Policy) in the Separate Account's
operation.

In the event of any such modification, Western Reserve will make
appropriate endorsements to the Policy. If any provision of the Policy conflicts
with the laws of a jurisdiction that govern the Policy, the Policy provides that
such provision be deemed to be amended to conform with such laws.

PAYMENTS BY WESTERN RESERVE

Western Reserve usually pays the amounts of any surrender, partial
withdrawals, Life Insurance Benefit Proceeds, or settlement options within seven
business days after receipt of all applicable written notices and/or due proofs
of death. However, Western Reserve can postpone such payments if:

1. the NYSE is closed, other than customary weekend and holiday
closing, or trading on the NYSE is restricted as determined by the
SEC; or

2. the SEC permits, by an order, the postponement for the protection of
Owners; or

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3. the SEC determines that an emergency exists that would make the
disposal of securities held in the Separate Account or the
determination of their value not reasonably practicable.

If a recent check or draft has been submitted, Western Reserve has the
right to defer payment of surrenders, partial withdrawals, Life Insurance
Benefit Proceeds, or payments under a settlement option until such check or
draft has been honored.

REPORTS TO OWNERS

Within 30 days after each Policy Anniversary, or more often as required by
law, Western Reserve will mail to Owners at their last known address a report
showing the following items as of the end of the report period:

1. the period covered by the report;

2. the current Cash Value and Net Cash Value;

3. the current Subaccount Values, and Loan Account Value;

4. the current Loan Amount;

5. any premium payments, partial withdrawals, or surrenders made, Life
Insurance Benefit Proceeds paid and charges deducted since the last
report;

6. current Net Premium allocations; and

7. any other information required by law.

Owners may request additional copies of reports from Western Reserve, but
Western Reserve reserves the right to charge a fee for such additional copies.
In addition, Western Reserve will send written confirmations of premium payments
and other financial transactions requested by Owners. Owners will also be sent
copies of the annual and semi-annual report to shareholders for each Portfolio
in which they are indirectly invested.

CLAIMS OF CREDITORS

Except as described in the Assignment section above, payments Western
Reserve makes under the Policy are, to the extent permitted by law, exempt from
the claims, attachments, or levies of any creditors.

DIVIDENDS

The Policy is a non-participating policy on which no dividends are payable.

SUPPLEMENTAL BENEFITS AND/OR RIDERS

The following supplemental benefits and/or riders are available and may be
added to a Policy. Monthly charges for these benefits and/or riders are deducted
from Cash Value as part of the monthly deduction. The supplemental benefits
and/or riders available with the Policies provide fixed benefits that do not
vary with the investment experience of the Separate Account.

Term Insurance Rider. The Term Insurance Rider provides term insurance
coverage for the Insured on a basis different from the coverage provided under
the Policy. The Term Insurance Rider may be purchased at the time of application
for the Policy or after the Policy is issued. The Term Insurance Rider increases
the death benefit provided under the Policy by the Face Amount of the rider. The
Term Insurance Rider terminates at age 100. Owners may reduce or cancel coverage
under the Term Insurance Rider separately from reducing the Face Amount of a
Policy. Likewise, the Face Amount of a Policy may be decreased, subject to
certain minimums, without reducing the coverage under the Term Insurance Rider.

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Western Reserve reserves the right to discontinue the availability of any
riders for new Policies at any time, and also reserves the right to modify the
terms of any riders for new Policies, subject to approval by the state insurance
departments.

FEDERAL TAX CONSIDERATIONS

INTRODUCTION

The following summary provides a general description of the Federal income
tax considerations associated with the Policy and does not purport to be
complete or to cover all tax situations. This discussion is not intended as tax
advice. Consult counsel or other competent tax advisors for more complete
information. This discussion is based upon Western Reserve's understanding of
the present Federal income tax laws. No representation is made as to the
likelihood of continuation of the present Federal income tax laws or as to how
they may be interpreted by the Internal Revenue Service.

TAX STATUS OF THE POLICY

In order to qualify as a life insurance contract for Federal income tax
purposes and to receive the tax treatment normally accorded life insurance
contracts under Federal tax law, a life insurance policy must satisfy certain
requirements which are set forth in the Internal Revenue Code. Guidance as to
how these requirements are to be applied is limited. Nevertheless, Western
Reserve believes that Policies issued on the basis of a standard rate class
should satisfy the applicable requirements. There is less guidance, however,
with respect to Policies issued on a substandard basis and it is not clear
whether such Policies will in all cases satisfy the applicable requirements,
particularly if the Owner pays the full amount of premiums permitted under the
Policy. If it is subsequently determined that a Policy does not satisfy the
applicable requirements, Western Reserve may take appropriate steps to bring the
Policy into compliance with such requirements and Western Reserve reserves the
right to modify the Policy as necessary in order to do so.

In certain circumstances, owners of variable life insurance policies have
been considered for Federal income tax purposes to be the owners of the assets
of separate accounts supporting their contracts due to their ability to exercise
investment control over those assets. Where this is the case, the policyowners
have been currently taxed on income and gains attributable to variable account
assets. There is little guidance in this area, and some features of the Policy,
such as the flexibility of Owners to allocate premium payments and policy
values, have not been explicitly addressed in published rulings. While Western
Reserve believes that the Policy does not give Owners investment control over
Separate Account assets, we reserve the right to modify the Policy as necessary
to prevent the Owner from being treated as the owner of the Separate Account
assets supporting the Policy.

In addition, the Code requires that the investments of the Subaccounts be
"adequately diversified" in order for the policy to be treated as a life
insurance contract for Federal income tax purposes. It is intended that the
Subaccounts, through the Portfolios, will satisfy these diversification
requirements.

The following discussion assumes that the Policy will qualify as a life
insurance contract for Federal income tax purposes.

TAX TREATMENT OF POLICY BENEFITS

IN GENERAL. Western Reserve believes that the death benefit under a Policy
should be excludible from the gross income of the beneficiary. Federal, state
and local estate, inheritance, transfer, and other tax consequences of ownership
or receipt of Policy proceeds depend on the circumstances of each Owner or
beneficiary. A tax advisor should be consulted on these consequences.

Generally, an Owner will not be deemed to be in constructive receipt of the
Cash Value until there is a distribution. When distributions from a Policy
occur, or when loans are taken out from or secured by a Policy, the tax
consequences depend on whether the Policy is classified as a "modified endowment
contract."

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MODIFIED ENDOWMENT CONTRACTS. Under the Internal Revenue Code, certain
life insurance contracts are classified as "modified endowment contracts," with
less favorable tax treatment than other life insurance contracts. Due to the
flexibility of the Policy as to premium payments and benefits, the individual
circumstances of each Policy will determine whether it is classified as a
modified endowment contract. The rules are too complex to be summarized here,
but generally depend on the amount of premium payments made during the first
seven Policy Years. Certain changes in a Policy after it is issued could also
cause it to be classified as a modified endowment contract. A current or
prospective Owner should consult with a competent advisor to determine whether a
Policy transaction will cause the Policy to be classified as a modified
endowment contract.

DISTRIBUTIONS OTHER THAN DEATH BENEFITS FROM MODIFIED ENDOWMENT
CONTRACTS. Policies classified as modified endowment contracts are subject to
the following tax rules:

(1) All distributions other than death benefits from a modified
endowment contract, including distributions upon surrender and withdrawals,
will be treated first as distributions of gain taxable as ordinary income
and as tax-free recovery of the Owner's investment in the policy only after
all gain has been distributed.

(2) Loans taken from or secured by a Policy classified as a modified
endowment contract are treated as distributions and taxed accordingly.

(3) A 10 percent additional income tax is imposed on the amount
subject to tax except where the distribution or loan is made when the Owner
has attained age 59 1/2 or is disabled, or where the distribution is part
of a series of substantially equal periodic payments for the life (or life
expectancy) of the Owner or the joint lives (or joint life expectancies) of
the Owner and the Owner's beneficiary or designated beneficiary.

If a Policy becomes a modified endowment contract, distributions that occur
during the Policy Year will be taxed as distributions from a modified endowment
contract. In addition, distributions from a Policy within two years before it
becomes a modified endowment contract will be taxed in this manner. This means
that a distribution made from a Policy that is not a modified endowment contract
could later become taxable as a distribution from a modified endowment contract.

DISTRIBUTIONS OTHER THAN DEATH BENEFITS FROM POLICIES THAT ARE NOT MODIFIED
ENDOWMENT CONTRACTS. Distributions other than death benefits from a Policy that
is not classified as a modified endowment contract are generally treated first
as a recovery of the Owner's investment in the Policy and only after the
recovery of all investment in the Policy as taxable income. However, certain
distributions which must be made in order to enable the Policy to continue to
qualify as a life insurance contract for Federal income tax purposes if Policy
benefits are reduced during the first 15 policy years may be treated in whole or
in part as ordinary income subject to tax.

The tax consequences of loans from or secured by a Policy that is not a
modified endowment contract are uncertain. You should consult a tax advisor
before taking out a Policy loan.

Finally, neither distributions from nor loans from or secured by a Policy
that is not a modified endowment contract are subject to the 10 percent
additional income tax.

INVESTMENT IN THE POLICY. Your investment in the Policy is generally your
aggregate premiums. When a distribution is taken from the Policy, your
investment in the Policy is reduced by the amount of the distribution that is
tax-free.

POLICY LOAN INTEREST. In general, interest on a Policy loan will not be
deductible. If a Policy loan is outstanding when a Policy is canceled or lapses,
then the amount of the outstanding indebtedness will be added to the amount
distributed and will be taxed accordingly.

MULTIPLE POLICIES. All modified endowment contracts that are issued by
Western Reserve (or its affiliates) to the same Owner during any calendar year
are treated as one modified endowment contract for purposes of determining the
amount includible in the Owner's income when a taxable distribution occurs.

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<PAGE> 44

Continuation Beyond Age 100. If the Policy continues in force beyond the
Insured's 100th birthday, the tax consequences are uncertain. You should consult
a tax advisor as to those consequences.

OTHER POLICY OWNER TAX MATTERS. Businesses can use the Policy in various
arrangements, including nonqualified deferred compensation or salary continuance
plans, split dollar insurance plans, executive bonus plans, tax exempt and
nonexempt welfare benefit plans, retiree medical benefit plans and others. The
tax consequences of such plans may vary depending on the particular facts and
circumstances. If you are purchasing the Policy for any arrangement the value of
which depends in part on its tax consequences, you should consult a qualified
tax advisor. In recent years, moreover, Congress has adopted new rules relating
to life insurance owned by businesses, and the Administration has recently
proposed legislation that would further affect life insurance owned by
businesses and non-natural person. Any business or non-natural person
contemplating the purchase of a new Policy or a change in an existing Policy
should consult a tax advisor.

POSSIBLE TAX LAW CHANGES

Although the likelihood of legislative changes is uncertain, there is
always the possibility that the tax treatment of the Policy could change by
legislation or otherwise. Consult a tax advisor with respect to legislative
developments and their effect on the Policy.

POSSIBLE CHARGES FOR WESTERN RESERVE'S TAXES

At the present time, Western Reserve makes no charge for any Federal, state
or local taxes (other than the charge for state premium taxes) that may be
attributable to the Subaccounts or to the policies. Western Reserve reserves the
right to charge the Subaccounts for any future taxes or economic burden Western
Reserve may incur.

OTHER INFORMATION ABOUT THE POLICIES AND WESTERN RESERVE

SALE OF THE POLICIES

The Policy will be sold by individuals who, in addition to being licensed
as life insurance agents for Western Reserve, are also registered
representatives of AFSG Securities Corporation ("AFSG"), the principal
underwriter of the Policies, or of broker-dealers who have entered into written
sales agreements with the principal underwriter. AFSG, which is located at 4333
Edgewood Road, N.E., Cedar Rapids, Iowa 52499 was incorporated in Pennsylvania
on March 12, 1986, is registered with the SEC under the Securities Exchange Act
of 1934 as a broker-dealer, and is a member of the National Association of
Securities Dealers, Inc. No amounts will be retained by AFSG for acting as
principal underwriter for the Policies. The maximum sales commission payable to
Western Reserve agents or other registered representatives will be approximately
14% of all premiums up to the Target Premium and 3% of all premiums in excess
thereof. In addition, certain production, persistency and managerial bonuses may
be paid.

VOTING PRIVILEGES

Western Reserve is the legal owner of shares held by the Subaccounts and as
such has the right to vote on all matters submitted to shareholders of the
Portfolios. However, as required by law, Western Reserve votes Portfolio shares
held in the Subaccounts at regular and special shareholder meetings of the
Portfolios in accordance with instructions received from persons having voting
interests in the corresponding Subaccounts.

The number of votes that an Owner has the right to instruct is calculated
separately for each Subaccount, and may include fractional votes. While the
Insured is still living and the Policy is in force, an Owner holds a voting
interest in each Subaccount to which Net Premiums are allocated. For each Owner,
the number of votes attributable to a Subaccount is determined by dividing the
Owner's Subaccount Value by the net asset value per share of the Portfolio in
which that Subaccount invests. The net asset value per share of each Portfolio
is the value for each share of a Portfolio on any Valuation Day. The method of
computing the net asset value per share is described in the prospectuses for the
Portfolios.

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The number of votes available to an Owner or person receiving payments
under the Policy is determined as of the date coinciding with the date
established by the Portfolio for determining shareholders eligible to vote at
the relevant meeting of the Portfolio's shareholders. Voting instructions will
be solicited by written communication prior to such meeting in accordance with
procedures established for the Portfolio. Each Owner or other person having a
voting interest in a Subaccount will receive proxy materials and reports
relating to any meeting of shareholders of the Portfolio in which that
Subaccount invests.

Portfolio shares as to which no timely instructions are received and shares
held by Western Reserve in a Subaccount as to which no Owner or other person has
a beneficial interest are voted in proportion to the voting instructions that
are received with respect to all Policies participating in that Subaccount.
Voting instructions to abstain on any item to be voted upon will be applied to
reduce the total number of votes eligible to be cast on a matter. Certain
actions affecting the Separate Account may require Owner approval. In that case,
an Owner will be entitled to vote in proportion to his or her Subaccount Value.

Western Reserve may, if required by state insurance regulators, disregard
voting instructions if such instructions would require Portfolio shares to be
voted so as to cause a change in sub-classification or investment objectives of
a Portfolio, or to approve or disapprove an investment management agreement or
an investment advisory agreement. In addition, Western Reserve may under certain
circumstances disregard voting instructions that would require changes in an
investment management agreement, investment manager, an investment advisory
agreement or an investment adviser of a Portfolio, provided that Western Reserve
reasonably disapproves of such changes in accordance with applicable regulations
under the 1940 Act. If Western Reserve ever disregards voting instructions, you
will be advised of that action and of the reasons for such action in the next
semi-annual report for the appropriate Portfolio.

WESTERN RESERVE'S DIRECTORS AND EXECUTIVE OFFICERS

Western Reserve is managed by a board of directors. The following table
sets forth the name, address and principal occupations during the past five
years of each of Western Reserve's directors and executive officers.

JOHN R. KENNEY(1), CHAIRMAN OF THE BOARD OF DIRECTORS, AND CHIEF EXECUTIVE
OFFICER. Chairman of the Board of Directors (1987 -- present) and Chief
Executive Officer (1982 -- present), President (1978 -- 1987 and December,
1992 -- December, 1999), Director (1978 -- present), Western Reserve Life
Assurance Co. of Ohio; Chairman of the Board of Directors (1985 -- present),
President (March, 1993 -- present), WRL Series Fund, Inc.; Chairman of the Board
(September, 1996 -- present), WRL Investment Management, Inc.; Chairman of the
Board (September, 1996 -- present), WRL Investment Services, Inc.; Chairman of
the Board of Directors (February, 1997 -- present), AEGON Asset Management
Services, Inc., Largo, Florida. Trustee (1987 -- present), Chairman (December,
1989 to September, 1990 and November, 1990 to present) and President and Chief
Executive Officer (November, 1986 to September, 1990), IDEX Mutual Funds, of St.
Petersburg, Florida.

JEROME C. VAHL, DIRECTOR AND PRESIDENT, 570 Carillon Parkway, St.
Petersburg, Florida 33716, Executive Vice President (1998 -- 1999), Vice
President (1995 -- 1998), Assistant Vice President (1994 -- 1995) of Western
Reserve; Vice President and Manager-Corporate Projects (1991 -- 1996), and
Manager-Tax and Technical (1986 -- 1991) of AEGON USA, Inc.

ALAN M. YAEGER(1), EXECUTIVE VICE PRESIDENT, ACTUARY AND CHIEF FINANCIAL
OFFICER. Executive Vice President (June, 1993 -- present), Chief Financial
Officer (December, 1995 -- present), Senior Vice President (1981 -- June, 1993)
and Actuary (1972 -- present), Western Reserve Life Assurance Co. of Ohio;
Director (September, 1996 -- present), WRL Investment Management, Inc.; Director
(September, 1996 -- present), WRL Investment Services, Inc.; Executive Vice
President (September, 1993 -- present), WRL Series Fund, Inc.

WILLIAM H. GEIGER(1), SENIOR VICE PRESIDENT, SECRETARY, CORPORATE COUNSEL
AND GROUP VICE PRESIDENT -- COMPLIANCE. Senior Vice President, Secretary,
Corporate Counsel and Group Vice President -- Compliance (1998 -- present),
Senior Vice President, Secretary, General Counsel and Group Vice
President -- Compliance (1996 -- 1998), Senior Vice President, Secretary, and
General Counsel (1990 -- 1996) of Western

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<PAGE> 46

Reserve; Group Vice President -- Compliance and Corporate Counsel
(1996 -- present) of AUSA Life Insurance Company, Inc., Bankers United Life
Assurance Company, Life Investors Insurance Company of America, Monumental Life
Insurance Company, and PFL Life Insurance Company, subsidiaries of AEGON USA,
Inc.; Assistant Secretary (1990 -- present), Vice President and Assistant
Secretary (1990 -- 1997) of IDEX Mutual Funds; and Assistant Secretary
(1994 -- present) and Vice President and Assistant Secretary (1994 -- 1997 of
WRL Series Fund, Inc.

ALLAN J. HAMILTON(1), VICE PRESIDENT, TREASURER AND CONTROLLER. Vice
President and Controller (1987 -- present), Treasurer (February,
1997 -- present), Assistant Vice President and Assistant Controller
(1983 -- 1987), Western Reserve Life Assurance Co. of Ohio; Treasurer and
Principal Financial Officer (February, 1997 -- present), WRL Series Fund, Inc.,
St. Petersburg , Florida.

JACK E. ZIMMERMAN, DIRECTOR, 507 St. Michel Circle, Kettering, Ohio 45429,
Director (1987 -- present), Western Reserve Life Assurance Co. of Ohio; Trustee,
IDEX Mutual Funds; retired from Martin Marietta Corporation (1993), Dayton,
Ohio.

LYMAN H. TREADWAY, DIRECTOR, 30195 Chagrin Blvd. Ste. 210N, Cleveland, Ohio
44124, Director (September, 1994 -- present), Western Reserve Life Assurance Co.
of Ohio; Consultant (1988 -- 1993), Cleveland, Ohio.

JAMES R. WALKER, DIRECTOR, 3320 Office Park Dr., Dayton, Ohio 45439,
Director (June, 1996 -- present) Western Reserve Life Assurance Co. of Ohio;
Self-employed, Public Accountant (1996 -- present); Partner, C.P.A.
(1990 -- 1995), Walker-Davis C.P.A.'s, Dayton, Ohio.
- ----------------
(1) The principal business address is Western Reserve Life Assurance Co. of
Ohio, P.O. Box 5068, Clearwater, Florida 33758-5068.

ADDITIONAL INFORMATION

A registration statement under the Securities Act of 1933 has been filed
with the SEC relating to the offering described in this prospectus. This
prospectus does not include all the information set forth in the registration
statement. The omitted information may be obtained at the SEC's principal office
in Washington, D.C. by paying the SEC's prescribed fees.

EXPERTS

The statutory-basis balance sheets of Western Reserve as of December 31,
1999 and 1998, and the related statutory-basis statements of operations, changes
in capital and surplus, and cash flows for each of the three years in the period
ended December 31, 1999, and the statutory-basis schedules as of December 31,
1999 and for each of the three years in the period ended December 31, 1999, have
been audited by Ernst & Young LLP, independent accountants, whose report thereon
is set forth elsewhere herein. Such financial statements and schedules are
included in this prospectus in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing. Actuarial matters
included in this prospectus have been examined by Kenneth Turnquist whose
opinion is filed as an exhibit to the registration statement.

LEGAL MATTERS

Sutherland Asbill & Brennan LLP of Washington, D.C. has provided advice on
certain matters relating to the federal securities laws.

LEGAL PROCEEDINGS

Western Reserve, like other life insurance companies, is involved in
lawsuits. Western Reserve is not aware of any class action lawsuits naming it as
a defendant or involving the Separate Account. In some lawsuits involving other
insurers, substantial damages have been sought and/or material settlement
payments have been made. Although the outcome of any litigation cannot be
predicted with certainty, Western Reserve

44
<PAGE> 47

believes that at the present time there are no pending or threatened lawsuits
that are reasonably likely to have a material adverse impact on the Separate
Account or Western Reserve.

FINANCIAL STATEMENTS

No financial statements of the Separate Account are included herein because
no Policies had been sold as of December 31, 1999. The financial statements of
Western Reserve appear on the following pages. The financial statements of
Western Reserve should be distinguished from financial statements of the
Separate Account and should be considered only as bearing upon Western Reserve's
ability to meet its obligations under the Policies.

45
<PAGE> 48

REPORT OF INDEPENDENT AUDITORS

The Board of Directors
Western Reserve Life Assurance Co. of Ohio

We have audited the accompanying statutory-basis balance sheets of Western
Reserve Life Assurance Co. of Ohio (wholly owned indirectly by AEGON N.V.) as of
December 31, 1999 and 1998, and the related statutory-basis statements of
operations, changes in capital and surplus, and cash flows for each of the three
years in the period ended December 31, 1999. Our audits also included the
statutory-basis financial statement schedules required by Regulation S-X,
Article 7. These financial statements and schedules are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements and schedules based on our audits. We did not audit the
"Separate Account Assets" and "Separate Account Liabilities" in the
statutory-basis balance sheets of the Company. The Separate Account financial
statements were audited by other auditors whose reports have been furnished to
us, and our opinion, insofar as it relates to the data included for the Separate
Accounts, is based solely upon the reports of the other auditors.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits and the reports of other auditors provide a
reasonable basis for our opinion.

As described in Note 1 to the financial statements, the Company presents
its financial statements in conformity with accounting practices prescribed or
permitted by the Insurance Department of the State of Ohio, which practices
differ from generally accepted accounting principles. The variances between such
practices and generally accepted accounting principles are also described in
Note 1. The effects on the financial statements of these variances are not
reasonably determinable but are presumed to be material.

In our opinion, because of the effects of the matter described in the
preceding paragraph, the financial statements referred to above do not present
fairly, in conformity with generally accepted accounting principles, the
financial position of Western Reserve Life Assurance Co. of Ohio at December 31,
1999 and 1998, or the results of its operations or its cash flows for each of
the three years in the period ended December 31, 1999.

However, in our opinion, based on our audits and the reports of other
auditors, the financial statements referred to above present fairly, in all
material respects, the financial position of Western Reserve Life Assurance Co.
of Ohio at December 31, 1999 and 1998, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 1999, in
conformity with accounting practices prescribed or permitted by the Insurance
Department of the State of Ohio. Also, in our opinion, the related financial
statement schedules, when considered in relation to the basic statutory-basis
financial statements taken as a whole, present fairly in all material respects
the information set forth therein.

ERNST & YOUNG LLP
Des Moines, Iowa
February 18, 2000

46
<PAGE> 49

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
BALANCE SHEETS -- STATUTORY BASIS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
DECEMBER 31
------------------------
1999 1998
----------- ----------
<S> <C> <C>
ADMITTED ASSETS
Cash and invested assets:
Cash and short-term investments........................... $ 23,932 $ 73,808
Bonds..................................................... 119,731 184,697
Common stocks:
Affiliated entities (cost: 1999 and 1998-$243)......... 2,156 704
Other (cost: 1999 and 1998-$302)....................... 358 384
Mortgage loans on real estate............................. 9,698 9,916
Home office properties.................................... 34,066 34,583
Investment properties..................................... 11,078 11,594
Policy loans.............................................. 182,975 112,982
Other invested assets..................................... -- 396
----------- ----------
Total cash and invested assets.................... 383,994 429,064
Premiums deferred and uncollected........................... 785 900
Accrued investment income................................... 1,638 2,867
Transfers from separate accounts due or accrued............. 463,721 350,633
Cash surrender value of life insurance policies............. 47,518 45,445
Other assets................................................ 6,614 9,239
Separate account assets..................................... 11,587,982 6,999,290
----------- ----------
Total admitted assets............................. $12,492,252 $7,837,438
=========== ==========
LIABILITIES AND CAPITAL AND SURPLUS
Liabilities:
Aggregate reserves for policies and contracts:
Life................................................... $ 302,138 $ 231,596
Annuity................................................ 268,864 265,418
Policy and contract claim reserves........................ 9,269 9,233
Other policyholders' funds................................ 38,633 38,080
Remittances and items not allocated....................... 20,686 20,569
Federal income taxes payable.............................. 5,873 5,716
Asset valuation reserve................................... 3,809 2,848
Interest maintenance reserve.............................. 7,866 9,684
Short-term note payable to affiliate...................... 17,100 44,200
Payable to affiliate...................................... 964 37,907
Other liabilities......................................... 49,478 31,151
Separate account liabilities.............................. 11,582,656 6,997,456
----------- ----------
Total liabilities................................. 12,307,336 7,693,858
Commitments and contingencies (Note 11)
Capital and surplus:
Common stock, $1.00 par value, 3,000,000 shares authorized
and 2,500,000 shares issued and outstanding at December
31, 1999 and 1,500,000 shares authorized, issued and
outstanding at December 31, 1998....................... 2,500 1,500
Paid-in surplus........................................... 120,107 120,107
Unassigned surplus........................................ 62,309 21,973
----------- ----------
Total capital and surplus......................... 184,916 143,580
----------- ----------
Total liabilities and capital and surplus......... $12,492,252 $7,837,438
=========== ==========
</TABLE>

See accompanying notes.

47
<PAGE> 50

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
STATEMENTS OF OPERATIONS -- STATUTORY BASIS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
Revenues:
Premiums and other considerations, net of reinsurance:
Life................................................ $ 584,729 $ 476,053 $ 394,370
Annuity............................................. 1,104,525 794,841 822,149
Net investment income.................................. 39,589 36,315 40,013
Amortization of interest maintenance reserve........... 1,751 744 1,576
Commissions and expense allowances on reinsurance
ceded............................................... 4,178 15,333 11
Income from fees associated with investment management,
administration and contract guarantees for separate
accounts............................................ 19,620 72,817 --
Other income........................................... 44,366 67,751 3,016
---------- ---------- ----------
1,798,758 1,463,854 1,261,135
Benefits and expenses:
Benefits paid or provided for:
Life................................................ 35,591 42,982 28,060
Surrender benefits.................................. 689,535 551,528 431,939
Other benefits...................................... 32,201 31,280 28,112
Increase (decrease) in aggregate reserves for
policies and contracts:
Life.............................................. 70,542 42,940 29,485
Annuity........................................... 3,446 (30,872) (35,940)
Other............................................. (121) 32,178 794
---------- ---------- ----------
831,194 670,036 482,450
Insurance expenses:
Commissions......................................... 246,334 205,939 179,106
General insurance expenses.......................... 112,536 102,611 70,546
Taxes, licenses and fees............................ 19,019 15,545 13,101
Net transfers to separate accounts.................. 540,443 475,435 519,214
Other expenses...................................... -- 59 21
---------- ---------- ----------
918,332 799,589 781,988
---------- ---------- ----------
1,749,526 1,469,625 1,264,438
---------- ---------- ----------
Gain (loss) from operations before federal income tax
expense (benefit) and net realized capital gains
(losses) on investments................................ 49,232 (5,771) (3,303)
Federal income tax expense (benefit)..................... 11,816 (347) 469
---------- ---------- ----------
Gain (loss) from operations before net realized capital
gains (losses) on investments.......................... 37,416 (5,424) (3,772)
Net realized capital gains (losses) on investments (net
of related federal income taxes and amounts transferred
to interest maintenance reserve)....................... (716) 1,494 747
---------- ---------- ----------
Net income (loss)........................................ $ 36,700 $ (3,930) $ (3,025)
========== ========== ==========
</TABLE>

See accompanying notes.

48
<PAGE> 51

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
STATEMENTS OF CHANGES IN CAPITAL AND SURPLUS -- STATUTORY BASIS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
TOTAL
COMMON PAID-IN UNASSIGNED CAPITAL AND
STOCK SURPLUS SURPLUS SURPLUS
------ -------- ---------- -----------
<S> <C> <C> <C> <C>
Balance at January 1, 1997........................... $1,500 $ 68,015 $26,041 $ 95,556
Net loss........................................... -- -- (3,025) (3,025)
Change in non-admitted assets...................... -- -- (702) (702)
Change in asset valuation reserve.................. -- -- 3,274 3,274
Change in surplus in separate accounts............. -- -- (2,115) (2,115)
Change in reserve valuation........................ -- -- (1,872) (1,872)
Capital contribution............................... -- 20,000 -- 20,000
Tax effect of capital loss carry-forward utilized
by affiliates................................... -- -- 3,747 3,747
------ -------- ------- --------
Balance at December 31, 1997......................... 1,500 88,015 25,348 114,863
Net loss........................................... -- -- (3,930) (3,930)
Change in net unrealized capital gains............. -- -- 248 248
Change in non-admitted assets...................... -- -- (1,815) (1,815)
Change in asset valuation reserve.................. -- -- (412) (412)
Change in surplus in separate accounts............. -- -- (341) (341)
Change in reserve valuation........................ -- -- (2,132) (2,132)
Capital contribution............................... -- 32,092 -- 32,092
Settlement of prior period tax returns............. -- -- 353 353
Tax benefits on stock options exercised............ -- -- 4,654 4,654
------ -------- ------- --------
Balance at December 31, 1998......................... 1,500 120,107 21,973 143,580
Net income......................................... -- -- 36,700 36,700
Change in net unrealized capital gains............. -- -- 1,421 1,421
Change in non-admitted assets...................... -- -- 703 703
Change in asset valuation reserve.................. -- -- (961) (961)
Change in surplus in separate accounts............. -- -- 451 451
Transfer from unassigned surplus to common stock
(stock dividend)................................ 1,000 -- (1,000) --
Settlement of prior period tax returns............. -- -- 1,000 1,000
Tax benefits on stock options exercised............ -- -- 2,022 2,022
------ -------- ------- --------
Balance at December 31, 1999......................... $2,500 $120,107 $62,309 $184,916
====== ======== ======= ========
</TABLE>

See accompanying notes.

49
<PAGE> 52

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
STATEMENTS OF CASH FLOWS -- STATUTORY BASIS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Premiums and other considerations, net of reinsurance.... $1,738,870 $1,356,732 $1,223,898
Net investment income.................................... 44,235 38,294 43,802
Life and accident and health claims...................... (35,872) (44,426) (26,005)
Surrender benefits and other fund withdrawals............ (689,535) (551,528) (431,939)
Other benefits to policyholders.......................... (32,642) (31,231) (28,147)
Commissions, other expenses and other taxes.............. (382,372) (326,080) (262,901)
Net transfers to separate accounts....................... (628,762) (461,982) (596,347)
Federal income taxes received (paid)..................... (9,637) 11,956 5,006
Interest paid............................................ -- -- (731)
Other, net............................................... (21,054) (7,109) (14,901)
---------- ---------- ----------
Net cash used in operating activities.................... (16,769) (15,374) (88,265)
INVESTING ACTIVITIES
Proceeds from investments sold, matured or repaid:
Bonds and preferred stocks............................. 114,177 143,449 146,963
Mortgage loans on real estate.......................... 212 221 2,116
Other.................................................. 18 -- --
---------- ---------- ----------
114,407 143,670 149,079
Cost of investments acquired
Bonds and preferred stocks............................. (49,279) (68,202) (40,418)
Common stocks.......................................... -- (93) (150)
Mortgage loans on real estate.......................... (1) (5,313) (891)
Real estate............................................ (286) (26,213) (12,002)
Policy loans........................................... (69,993) (36,241) (24,137)
Other.................................................. (855) (414) --
---------- ---------- ----------
(120,414) (136,476) (77,598)
---------- ---------- ----------
Net cash provided by (used in) investing activities...... (6,007) 7,194 71,481
FINANCING ACTIVITIES
Issuance (payment) of short-term note payable to
affiliate, net......................................... (27,100) 36,000 8,200
Capital contribution..................................... -- 32,092 20,000
---------- ---------- ----------
Net cash provided by (used in) financing activities...... (27,100) 68,092 28,200
---------- ---------- ----------
Increase (decrease) in cash and short-term investments... (49,876) 59,912 11,416
Cash and short-term investments at beginning of year..... 73,808 13,896 2,480
---------- ---------- ----------
Cash and short-term investments at end of year........... $ 23,932 $ 73,808 $ 13,896
========== ========== ==========
</TABLE>

See accompanying notes.

50
<PAGE> 53

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS
(DOLLARS IN THOUSANDS)
DECEMBER 31, 1999

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

Western Reserve Life Assurance Co. of Ohio ("the Company") is a stock life
insurance company and is a wholly-owned subsidiary of First AUSA Life Insurance
Company which, in turn, is a wholly-owned subsidiary of AEGON USA, Inc.
("AEGON"). AEGON is an indirect wholly-owned subsidiary of AEGON N.V., a holding
company organized under the laws of The Netherlands.

NATURE OF BUSINESS

The Company operates predominantly in the variable universal life and
variable annuity areas of the life insurance business. The Company is licensed
in 49 states, District of Columbia, Puerto Rico and Guam. Sales of the Company's
products are through financial planners, independent representatives, financial
institutions and stockbrokers. The majority of the Company's new life insurance
written and a substantial portion of new annuities written is done through one
marketing organization; the Company expects to maintain this relationship for
the foreseeable future.

BASIS OF PRESENTATION

The preparation of financial statements of insurance companies requires
management to make estimates and assumptions that affect amounts reported in the
financial statements and accompanying notes. Such estimates and assumptions
could change in the future as more information becomes known, which could impact
the amounts reported and disclosed herein.

The accompanying financial statements have been prepared in conformity with
accounting practices prescribed or permitted by the Insurance Department of the
State of Ohio ("Insurance Department"), which practices differ from generally
accepted accounting principles. The more significant of these differences are as
follows: (a) bonds are generally reported at amortized cost rather than
segregating the portfolio into held-to-maturity (reported at amortized cost),
available-for-sale (reported at fair value), and trading (reported at fair
value) classifications; (b) acquisition costs of acquiring new business are
expensed as incurred rather than deferred and amortized over the life of the
policies; (c) policy reserves on traditional life products are based on
statutory mortality rates and interest which may differ from reserves based on
reasonable assumptions of expected mortality, interest, and withdrawals which
include a provision for possible unfavorable deviation from such assumptions;
(d) policy reserves on certain investment products use discounting methodologies
utilizing statutory interest rates rather than full account values; (e)
reinsurance amounts are netted against the corresponding asset or liability
rather than shown as gross amounts on the balance sheet; (f) deferred income
taxes are not provided for the difference between the financial statement
amounts and income tax bases of assets and liabilities; (g) net realized gains
or losses attributed to changes in the level of interest rates in the market are
deferred and amortized over the remaining life of the bond or mortgage loan,
rather than recognized as gains or losses in the statement of operations when
the sale is completed; (h) potential declines in the estimated realizable value
of investments are provided for through the establishment of a formula-
determined statutory investment reserve (reported as a liability), changes to
which are charged directly to surplus, rather than through recognition in the
statement of operations for declines in value, when such declines are judged to
be other than temporary; (i) certain assets designated as "non-admitted assets"
have been charged to unassigned surplus rather than being reported as assets;
(j) revenues for universal life and investment products consist of the entire
premiums received rather than policy charges for the cost of insurance, policy
administration charges, amortization of policy initiation fees and surrender
charges assessed; (k) pension expense is recorded as amounts are paid rather
than accrued and expensed during the periods in which the employers provide
service; (l) stock options settled in cash are recorded as an expense of the

51
<PAGE> 54
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)
Company's indirect parent rather than charged to current operations; (m)
adjustments to federal income taxes of prior years are charged or credited
directly to unassigned surplus, rather than reported as a component of income
tax expense in the statement of operations; and (n) the financial statements of
wholly-owned affiliates are not consolidated with those of the Company. The
effects of these variances have not been determined by the Company, but are
presumed to be material.

In 1998, the National Association of Insurance Commissioners (NAIC) adopted
codified statutory accounting principles ("Codification") effective January 1,
2001. Codification will likely change, to some extent, prescribed statutory
accounting practices and may result in changes to the accounting practices that
the Company uses to prepare its statutory-basis financial statements.
Codification will require adoption by the various states before it becomes the
prescribed statutory basis of accounting for insurance companies domesticated
within those states. Accordingly, before Codification becomes effective for the
Company, the State of Ohio must adopt Codification as the prescribed basis of
accounting on which domestic insurers must report their statutory-basis results
to the Insurance Department. At this time it is unclear whether the State of
Ohio will adopt Codification. However, based on current guidance, management
believes that the impact of Codification will not be material to the Company's
statutory-basis financial statements.

Other significant statutory accounting practices are as follows:

CASH AND CASH EQUIVALENTS

For purposes of the statements of cash flows, the Company considers all
highly liquid investments with remaining maturities of one year or less when
purchased to be cash equivalents.

INVESTMENTS

Investments in bonds (except those to which the Securities Valuation Office
of the NAIC has ascribed a value), mortgage loans on real estate and short-term
investments are reported at cost adjusted for amortization of premiums and
accrual of discounts. Amortization is computed using methods which result in a
level yield over the expected life of the investment. The Company reviews its
prepayment assumptions on mortgage and other asset backed securities at regular
intervals and adjusts amortization rates retrospectively when such assumptions
are changed due to experience and/or expected future patterns. Common stocks of
unaffiliated companies are carried at market, and the related unrealized capital
gains/(losses) are reported in unassigned surplus without any adjustment for
federal income taxes. Common stocks of the Company's wholly-owned affiliates are
recorded at the equity in net assets. Home office and investment properties are
reported at cost less allowances for depreciation. Depreciation is computed
principally by the straight-line method. Policy loans are reported at unpaid
principal. Other "admitted assets" are valued, principally at cost, as required
or permitted by Ohio Insurance Laws.

Realized capital gains and losses are determined on the basis of specific
identification and are recorded net of related federal income taxes. The Asset
Valuation Reserve (AVR) is established by the Company to provide for potential
losses in the event of default by issuers of certain invested assets. These
amounts are determined using a formula prescribed by the NAIC and are reported
as a liability. The formula for the AVR provides for a corresponding adjustment
for realized gains and losses. Under a formula prescribed by the NAIC, the
Company defers, in the Interest Maintenance Reserve (IMR), the portion of
realized gains and losses on sales of fixed income investments, principally
bonds and mortgage loans, attributable to changes in the general level of
interest rates and amortizes those deferrals over the remaining period to
maturity of the security.

52
<PAGE> 55
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)
During 1999, 1998 and 1997, net realized capital gains (losses) of $(67),
$1,294 and $3,259, respectively, were credited to the IMR rather than being
immediately recognized in the statements of operations. Amortization of these
net gains aggregated $1,751, $744 and $1,576 for the years ended December 31,
1999, 1998 and 1997, respectively.

Interest income is recognized on an accrual basis. The Company does not
accrue income on bonds in default, mortgage loans on real estate in default
and/or foreclosure or which are delinquent more than twelve months, or real
estate where rent is in arrears for more than three months. Further, income is
not accrued when collection is uncertain. No investment income due and accrued
has been excluded for the years ended December 31, 1999, 1998 and 1997, with
respect to such practices.

AGGREGATE RESERVES FOR POLICIES

Life and annuity reserves are developed by actuarial methods and are
determined based on published tables using statutorily specified interest rates
and valuation methods that will provide, in the aggregate, reserves that are
greater than or equal to the minimum required by law.

The aggregate policy reserves for life insurance policies are based
principally upon the 1941, 1958 and 1980 Commissioners' Standard Ordinary
Mortality Tables. The reserves are calculated using interest rates ranging from
2.25 to 5.50 percent and are computed principally on the Net Level Premium
Valuation and the Commissioners' Reserve Valuation Methods. Reserves for
universal life policies are based on account balances adjusted for the
Commissioners' Reserve Valuation Method.

Deferred annuity reserves are calculated according to the Commissioners'
Annuity Reserve Valuation Method including excess interest reserves to cover
situations where the future interest guarantees plus the decrease in surrender
charges are in excess of the maximum valuation rates of interest. Reserves for
immediate annuities and supplementary contracts with life contingencies are
equal to the present value of future payments assuming interest rates ranging
from 5.75 to 8.75 percent and mortality rates, where appropriate, from a variety
of tables.

POLICY AND CONTRACT CLAIM RESERVES

Claim reserves represent the estimated accrued liability for claims
reported to the Company and claims incurred but not yet reported through the
statement date. These reserves are estimated using either individual case-basis
valuations or statistical analysis techniques. These estimates are subject to
the effects of trends in claim severity and frequency. The estimates are
continually reviewed and adjusted as necessary as experience develops or new
information becomes available.

SEPARATE ACCOUNTS

Assets held in trust for purchases of variable universal life and variable
annuity contracts and the Company's corresponding obligation to the contract
owners are shown separately in the balance sheets. The assets in the separate
accounts are valued at market. Income and gains and losses with respect to the
assets in the separate accounts accrue to the benefit of the policyholders and,
accordingly, the operations of the separate accounts are not included in the
accompanying financial statements. The separate accounts do not have any minimum
guarantees and the investment risks associated with market value changes are
borne entirely by the policyholders. The Company received variable contract
premiums of $1,675,642, $1,240,858 and $1,164,013 in 1999, 1998 and 1997,
respectively. All variable account contracts are subject to discretionary
withdrawal by the policyholder at the market value of the underlying assets less
the current surrender charge. Separate account contractholders have no claim
against the assets of the general account.

53
<PAGE> 56
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)
STOCK OPTION PLAN

AEGON N.V. sponsors a stock option plan for eligible employees of the
Company. Under this plan, certain employees have indicated a preference to
immediately sell shares received as a result of their exercise of the stock
options; in these situations, AEGON N.V. has settled such options in cash rather
than issuing stock to these employees. These cash settlements are paid by the
Company, and AEGON N.V. subsequently reimburses the Company for such payments.
Under statutory accounting principles, the Company does not record any expense
related to this plan, as the expense is recognized by AEGON N.V. However, the
Company is allowed to record a deduction in the consolidated tax return filed by
the Company and certain affiliates. The tax benefit of this deduction has been
credited directly to unassigned surplus.

RECLASSIFICATIONS

Certain reclassifications have been made to the 1998 and 1997 financial
statements to conform to the 1999 presentation.

2. FAIR VALUES OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107, Disclosures about Fair
Value of Financial Instruments, requires disclosure of fair value information
about financial instruments, whether or not recognized in the statutory-basis
balance sheet, for which it is practicable to estimate that value. In cases
where quoted market prices are not available, fair values are based on estimates
using present value or other valuation techniques. Those techniques are
significantly affected by the assumptions used, including the discount rate and
estimates of future cash flows. In that regard, the derived fair value estimates
cannot be substantiated by comparisons to independent markets and, in many
cases, could not be realized in immediate settlement of the instrument.
Statement of Financial Accounting Standards No. 107 excludes certain financial
instruments and all nonfinancial instruments from its disclosure requirements
and allows companies to forego the disclosures when those estimates can only be
made at excessive cost. Accordingly, the aggregate fair value amounts presented
do not represent the underlying value of the Company.

The following methods and assumptions were used by the Company in
estimating its fair value disclosures for financial instruments:

Cash and Short-Term Investments: The carrying amounts reported in the
statutory-basis balance sheet for these instruments approximate their
fair values.

Investment Securities: Fair values for fixed maturity securities
(including redeemable preferred stocks) are based on quoted market
prices, where available. For fixed maturity securities not actively
traded, fair values are estimated using values obtained from independent
pricing services or (in the case of private placements) are estimated by
discounting expected future cash flows using a current market rate
applicable to the yield, credit quality, and maturity of the
investments. The fair values for equity securities are based on quoted
market prices.

Mortgage Loans and Policy Loans: The fair values for mortgage loans are
estimated utilizing discounted cash flow analyses, using interest rates
reflective of current market conditions and the risk characteristics of
the loans. The fair value of policy loans are assumed to equal their
carrying value.

Investment Contracts: Fair values for the Company's liabilities under
investment-type insurance contracts are estimated using discounted cash
flow calculations, based on interest rates currently being offered for
similar contracts with maturities consistent with those remaining for
the contracts being valued.

54
<PAGE> 57
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

2. FAIR VALUES OF FINANCIAL INSTRUMENTS -- (CONTINUED)
Fair values for the Company's insurance contracts other than investment
contracts are not required to be disclosed. However, the fair values of
liabilities under all insurance contracts are taken into consideration in the
Company's overall management of interest rate risk, which minimizes exposure to
changing interest rates through the matching of investment maturities with
amounts due under insurance contracts.

The following sets forth a comparison of the fair values and carrying
amounts of the Company's financial instruments subject to the provisions of
Statement of Financial Accounting Standards No. 107:

<TABLE>
<CAPTION>
DECEMBER 31
------------------------------------------------------------
1999 1998
----------------------------- ----------------------------
CARRYING AMOUNT FAIR VALUE CARRYING AMOUNT FAIR VALUE
--------------- ----------- --------------- ----------
<S> <C> <C> <C> <C>
ADMITTED ASSETS
Cash and short-term investments........ $ 23,932 $ 23,932 $ 73,808 $ 73,808
Bonds.................................. 119,731 119,076 184,697 192,556
Common stocks, other than affiliates... 358 358 384 384
Mortgage loans on real estate.......... 9,698 9,250 9,916 10,390
Policy loans........................... 182,975 182,975 112,982 112,982
Separate account assets................ 11,587,982 11,587,982 6,999,290 6,999,290
LIABILITIES
Investment contract liabilities........ 301,403 294,342 297,349 294,105
Separate account annuities............. 8,271,548 8,079,141 5,096,680 5,038,296
</TABLE>

3. INVESTMENTS

The carrying amount and estimated fair value of investments in debt
securities are as follows:

<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
CARRYING UNREALIZED UNREALIZED FAIR
AMOUNT GAINS LOSSES VALUE
-------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
DECEMBER 31, 1999
Bonds:
United States Government and agencies.......... $ 4,755 $ 4 $ 66 $ 4,693
State, municipal and other government.......... 2,185 12 -- 2,197
Public utilities............................... 13,134 129 368 12,895
Industrial and miscellaneous................... 52,997 1,213 1,208 53,002
Mortgage and other asset-backed securities..... 46,660 480 851 46,289
-------- ------ ------ --------
Total bonds......................................... $119,731 $1,838 $2,493 $119,076
======== ====== ====== ========
</TABLE>

55
<PAGE> 58
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

3. INVESTMENTS -- (CONTINUED)

<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
CARRYING UNREALIZED UNREALIZED FAIR
VALUE GAINS LOSSES VALUE
-------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
DECEMBER 31, 1998
Bonds:
United States Government and
agencies............................. $ 4,749 $ 83 $-- $ 4,832
State, municipal and other
government........................... 3,234 117 -- 3,351
Public utilities....................... 18,792 818 251 19,359
Industrial and miscellaneous........... 96,332 6,685 577 102,440
Mortgage and other asset-backed
securities........................... 61,590 1,235 251 62,574
-------- ------ ------ --------
Total bonds................................. $184,697 $8,938 $1,079 $192,556
======== ====== ====== ========
</TABLE>

The carrying amount and fair value of bonds at December 31, 1999 by
contractual maturity are shown below. Expected maturities may differ from
contractual maturities because borrowers may have the right to call or prepay
obligations with or without penalties.

<TABLE>
<CAPTION>
ESTIMATED
CARRYING FAIR
VALUE VALUE
-------- ---------
<S> <C> <C>
Due in one year or less..................................... $ 10,521 $ 10,560
Due one through five years.................................. 32,248 31,993
Due five through ten years.................................. 17,342 17,104
Due after ten years......................................... 12,960 13,130
-------- --------
73,071 72,787
Mortgage and other asset-backed securities.................. 46,660 46,289
-------- --------
$119,731 $119,076
======== ========
</TABLE>

A detail of net investment income is presented below:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
---------------------------
1999 1998 1997
------- ------- -------
<S> <C> <C> <C>
Interest on bonds........................................ $12,094 $17,150 $25,723
Dividends on equity investments from subsidiaries........ 18,555 13,233 10,855
Interest on mortgage loans............................... 746 499 478
Rental income on real estate............................. 5,794 2,839 1,371
Interest on policy loans................................. 9,303 6,241 4,656
Other investment income.................................. 414 540 26
------- ------- -------
Gross investment income.................................. 46,906 40,502 43,109
Investment expenses...................................... (7,317) (4,187) (3,096)
------- ------- -------
Net investment income.................................... $39,589 $36,315 $40,013
======= ======= =======
</TABLE>

56
<PAGE> 59
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

3. INVESTMENTS -- (CONTINUED)
Proceeds from sales and maturities of debt securities and related gross
realized gains and losses were as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------
1999 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Proceeds.............................................. $114,177 $143,449 $146,963
======== ======== ========
Gross realized gains.................................. $ 1,762 $ 4,641 $ 3,921
Gross realized losses................................. 1,709 899 626
-------- -------- --------
Net realized gains.................................... $ 53 $ 3,742 $ 3,295
======== ======== ========
</TABLE>

At December 31, 1999, bonds with an aggregate carrying value of $4,152 were
on deposit with certain state regulatory authorities or were restrictively held
in bank custodial accounts for benefit of such state regulatory authorities, as
required by statute.

Realized investment gains (losses) and changes in unrealized gains (losses)
for investments are summarized below:

<TABLE>
<CAPTION>
REALIZED
-------------------------
YEAR ENDED DECEMBER 31
1999 1998 1997
----- ------- -------
<S> <C> <C> <C>
Debt securities........................................... $ 53 $ 3,742 $ 3,295
Other invested assets..................................... 18 (18) --
----- ------- -------
71 3,724 3,295
Tax expense............................................... (854) (936) (711)
Transfer to interest maintenance reserve.................. 67 (1,294) (3,259)
----- ------- -------
Net realized gains (losses)............................... $(716) $ 1,494 $ 747
===== ======= =======
</TABLE>

<TABLE>
<CAPTION>
CHANGES IN UNREALIZED
-------------------------
YEAR ENDED DECEMBER 31
1999 1998 1997
------- ------- -----
<S> <C> <C> <C>
Debt securities............................................. $(8,514) $(3,985) $(896)
Common stocks............................................... 1,426 248 --
------- ------- -----
Change in unrealized appreciation (depreciation)............ $(7,088) $(3,737) $(896)
======= ======= =====
</TABLE>

Gross unrealized gains (losses) on common stocks were as follows:

<TABLE>
<CAPTION>
UNREALIZED
-------------
DECEMBER 31
-------------
1999 1998
------ ----
<S> <C> <C>
Unrealized gains............................................ $1,995 $579
Unrealized losses........................................... (26) (36)
------ ----
Net unrealized gains........................................ $1,969 $543
====== ====
</TABLE>

During 1999, the Company did not issue any mortgage loans. The Company
requires all mortgagees to carry fire insurance equal to the value of the
underlying property.

57
<PAGE> 60
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

3. INVESTMENTS -- (CONTINUED)
During 1999, 1998 and 1997, no mortgage loans were foreclosed and
transferred to real estate. During 1999 and 1998, the Company held a mortgage
loan loss reserve in the asset valuation reserve of $110 and $112, respectively.

At December 31, 1999, the Company had no investments (excluding U. S.
Government guaranteed or insured issues) which individually represented more
than ten percent of capital and surplus and the asset valuation reserve,
collectively.

4. REINSURANCE

The Company reinsures portions of certain insurance policies which exceed
its established limits, thereby providing a greater diversification of risk and
minimizing exposure on larger risks. The Company remains contingently liable
with respect to any insurance ceded, and this would become an actual liability
in the event that the assuming insurance company became unable to meet its
obligations under the reinsurance treaty.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
Direct premiums.................................. $1,748,265 $1,345,752 $1,219,271
Reinsurance assumed.............................. -- 461 2,389
Reinsurance ceded................................ (59,011) (75,319) (5,141)
---------- ---------- ----------
Net premiums earned.............................. $1,689,254 $1,270,894 $1,216,519
========== ========== ==========
</TABLE>

The Company received reinsurance recoveries in the amount of $4,916, $5,260
and $2,288 during 1999, 1998 and 1997, respectively. At December 31, 1999 and
1998, estimated amounts recoverable from reinsurers that have been deducted from
policy and contract claim reserves totaled $1,557 and $1,003, respectively. The
aggregate reserves for policies and contracts were reduced for reserve credits
for reinsurance ceded at December 31, 1999 and 1998 of $3,487 and $2,849,
respectively.

5. INCOME TAXES

For federal income tax purposes, the Company joins in a consolidated tax
return filing with certain affiliated companies. Under the terms of a
tax-sharing agreement between the Company and its affiliates, the Company
computes federal income tax expense as if it were filing a separate income tax
return, except that tax credits and net operating loss carryforwards are
determined on the basis of the consolidated group. Additionally, the alternative
minimum tax is computed for the consolidated group and the resulting tax, if
any, is allocated back to the separate companies on the basis of the separate
companies' alternative minimum taxable income.

58
<PAGE> 61
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

5. INCOME TAXES -- (CONTINUED)
Federal income tax expense (benefit) differs from the amount computed by
applying the statutory federal income tax rate to gain (loss) from operations
before federal income tax expense (benefit) and realized capital gains (losses)
on investments for the following reasons:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
----------------------------
1999 1998 1997
-------- ------- -------
<S> <C> <C> <C>
Computed tax (benefit) at federal statutory rate (35%)...... $ 17,231 $(2,019) $(1,156)
Deferred acquisition costs -- tax basis..................... 11,344 9,672 9,164
Tax reserve valuation....................................... (2,272) 1,513 (194)
Excess tax depreciation..................................... (727) (442) (127)
Amortization of IMR......................................... (613) (260) (552)
Dividend received deduction................................. (10,784) (6,657) (5,326)
Prior year over-accrual..................................... (3,167) (2,322) (1,541)
Other, net.................................................. 804 168 201
-------- ------- -------
Federal income tax expense (benefit)........................ $ 11,816 $ (347) $ 469
======== ======= =======
</TABLE>

Federal income tax expense (benefit) differs from the amount computed by
applying the statutory federal income tax rate to realized gains (losses) due to
the differences in book and tax asset bases at the time certain investments are
sold.

Prior to 1984, as provided for under the Life Insurance Company Tax Act of
1959, a portion of statutory income was not subject to current taxation, but was
accumulated for income tax purposes in a memorandum account referred to as the
policyholders' surplus account. No federal income taxes have been provided for
in the financial statements on income deferred in the policyholders' surplus
account ($293 at December 31, 1999). To the extent dividends are paid from the
amount accumulated in the policyholders' surplus account, net earnings would be
reduced by the amount of tax required to be paid. Should the entire amount in
the policyholders' surplus account become taxable, the tax thereon computed at
current rates would amount to approximately $103.

At December 31, 1996, the Company had capital loss carryforwards of
approximately $10,705, which were utilized by the Company's affiliates in the
consolidated tax return filing in 1997. This transaction resulted in a receipt
from the Company's affiliate of $3,747, which was credited directly to
unassigned surplus.

In 1999, the Company received $1,000 from its former parent, an
unaffiliated company, for reimbursement of prior period tax payments made by the
Company but owed by the former parent. In 1998, the Company reached a final
settlement with the Internal Revenue Service for 1994 and 1995 resulting in a
tax refund of $300 and interest received of $53. Tax settlements for 1999 and
1998 were credited directly to unassigned surplus.

6. POLICY AND CONTRACT ATTRIBUTES

A portion of the Company's policy reserves and other policyholders' funds
relate to liabilities established on a variety of the Company's products,
primarily separate accounts, that are not subject to significant mortality or
morbidity risk; however, there may be certain restrictions placed upon the
amount of funds that

59
<PAGE> 62
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

6. POLICY AND CONTRACT ATTRIBUTES -- (CONTINUED)
can be withdrawn without penalty. The amount of reserves on these products, by
withdrawal characteristics are summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31
---------------------------------------------
1999 1998
--------------------- ---------------------
PERCENT PERCENT
AMOUNT OF TOTAL AMOUNT OF TOTAL
---------- -------- ---------- --------
<S> <C> <C> <C> <C>
Subject to discretionary withdrawal with
market value adjustment.................... $ 12,534 0% $ 12,810 0%
Subject to discretionary withdrawal at book
value less surrender charge................ 73,903 1 76,289 1
Subject to discretionary withdrawal at market
value...................................... 8,271,441 96 5,096,680 94
Subject to discretionary withdrawal at book
value (minimal or no charges or
adjustments)............................... 217,372 3 210,270 4
Not subject to discretionary withdrawal
provision.................................. 15,433 0 15,681 1
---------- --- ---------- ---
8,590,683 100% 5,411,730 100%
========== === ========== ===
Less reinsurance ceded....................... 1,581 1,131
---------- ----------
Total policy reserves on annuities and
deposit fund liabilities................... $8,589,102 $5,410,599
========== ==========
</TABLE>

A reconciliation of the amounts transferred to and from the separate
accounts is presented below:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
Transfers as reported in the summary of
operations of the separate accounts statement:
Transfers to separate accounts.............. $1,675,642 $1,240,858 $1,164,013
Transfers from separate accounts............ 1,056,207 774,690 646,477
---------- ---------- ----------
Net transfers to separate accounts............... 619,435 466,168 517,536
Reconciling adjustments -- change in accruals for
investment management, administration fees and
contract guarantees, reinsurance and separate
account surplus................................ (78,992) 9,267 1,678
---------- ---------- ----------
Transfers as reported in the summary of
operations of the life, accident and health
annual statement............................... $ 540,443 $ 475,435 $ 519,214
========== ========== ==========
</TABLE>

Reserves on the Company's traditional life insurance products are computed
using mean reserving methodologies. These methodologies result in the
establishment of assets for the amount of the net valuation premiums that are
anticipated to be received between the policy's paid-through date to the
policy's next

60
<PAGE> 63
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

6. POLICY AND CONTRACT ATTRIBUTES -- (CONTINUED)
anniversary date. At December 31, 1999 and 1998, these assets (which are
reported as premiums deferred and uncollected) and the amounts of the related
gross premiums and loadings, are as follows:

<TABLE>
<CAPTION>
GROSS LOADING NET
------ ------- ----
<S> <C> <C> <C>
DECEMBER 31, 1999
Ordinary direct renewal business............................ $1,017 $232 $785
------ ---- ----
$1,017 $232 $785
====== ==== ====
DECEMBER 31, 1998
Ordinary direct renewal business............................ $1,101 $201 $900
------ ---- ----
$1,101 $201 $900
====== ==== ====
</TABLE>

In 1994, the NAIC enacted a guideline to clarify reserving methodologies
for contracts that require immediate payment of claims upon proof of death of
the insured. Companies were allowed to grade the effects of the change in
reserving methodologies over five years. A direct charge to surplus of $2,132
and $1,872 was made for the years ended December 31, 1998 and 1997,
respectively, related to the change in reserve methodology.

7. DIVIDEND RESTRICTIONS

The Company is subject to limitations, imposed by the State of Ohio, on the
payment of dividends to its parent company. Generally, dividends during any
twelve month period may not be paid; without prior regulatory approval, in
excess of the greater of (a) 10 percent of statutory capital and surplus as of
the preceding December 31, or (b) statutory gain from operations for the
preceding year. Subject to the availability of unassigned surplus at the time of
such dividend, the maximum payment which may be made in 2000, without the prior
approval of insurance regulatory authorities, is $36,700.

8. CAPITAL STRUCTURE

During 1999, the Company's Board of Director's approved an amendment to the
Company's Articles of Incorporation which increased the number of authorized
capital shares to 3,000,000. The Board of Directors also authorized a stock
dividend in the amount of $1,000, which was transferred from unassigned surplus.
This amendment and stock dividend were in response to a change in California law
which requires all life insurance companies which do business in the state to
have capital stock of at least $2,500.

9. RETIREMENT AND COMPENSATION PLANS

The Company's employees participate in a qualified benefit plan sponsored
by AEGON. The Company has no legal obligation for the plan. The Company
recognizes pension expense equal to its allocation from AEGON. The pension
expense is allocated among the participating companies based on the Statement of
Financial Accounting Standards No. 87 expense as a percent of salaries. The
benefits are based on years of service and the employee's compensation during
the highest five consecutive years of employment. Pension expense aggregated
$1,105, $917 and $659 for the years ended December 31, 1999, 1998 and 1997,
respectively. The plan is subject to the reporting and disclosure requirements
of the Employee Retirement and Income Security Act of 1974.

The Company's employees also participate in a contributory defined
contribution plan sponsored by AEGON which is qualified under Section 401(k) of
the Internal Revenue Service Code. Employees of the Company who customarily work
at least 1,000 hours during each calendar year and meet the other eligibility

61
<PAGE> 64
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

9. RETIREMENT AND COMPENSATION PLANS -- (CONTINUED)
requirements are participants of the plan. Participants may elect to contribute
up to fifteen percent of their salary to the plan. The Company will match an
amount up to three percent of the participant's salary. Participants may direct
all of their contributions and plan balances to be invested in a variety of
investment options. The plan is subject to the reporting and disclosure
requirements of the Employee Retirement and Income Security Act of 1974. Pension
expense related to this plan was $816, $632 and $448 for the years ended
December 31, 1999, 1998 and 1997, respectively.

AEGON sponsors supplemental retirement plans to provide the Company's
senior management with benefits in excess of normal pension benefits. The plans
are noncontributory and benefits are based on years of service and the
employee's compensation level. The plans are unfunded and nonqualified under the
Internal Revenue Code. In addition, AEGON has established incentive deferred
compensation plans for certain key employees of the Company. AEGON also sponsors
an employee stock option plan for individuals employed at least three years and
a stock purchase plan for its producers, with the participating affiliated
companies establishing their own eligibility criteria, producer contribution
limits and company matching formula. These plans have been accrued for or funded
as deemed appropriate by management of AEGON and the Company.

In addition to pension benefits, the Company participates in plans
sponsored by AEGON that provide postretirement medical, dental and life
insurance benefits to employees meeting certain eligibility requirements.
Portions of the medical and dental plans are contributory. The expenses of the
postretirement plans calculated on the pay-as-you-go basis are charged to
affiliates in accordance with an intercompany cost sharing arrangement. The
Company expensed $81, $157 and $99 for the years ended December 31, 1999, 1998
and 1997, respectively.

10. RELATED PARTY TRANSACTIONS

The Company shares certain officers, employees and general expenses with
affiliated companies.

The Company receives data processing, investment advisory and management,
marketing and administration services from certain affiliates. During 1999, 1998
and 1997, the Company paid $16,905 $12,763 and $10,040, respectively, for such
services, which approximates their costs to the affiliates. The Company provides
office space, marketing and administrative services to certain affiliates.
During 1999, 1998 and 1997, the Company received $3,755, $5,125 and $4,395,
respectively, for such services, which approximates their cost.

Payable to affiliates and intercompany borrowings bear interest at the
thirty-day commercial paper rate of 5.06% at December 31, 1999. During 1999,
1998 and 1997, the Company paid net interest of $1,997, $1,090 and $364,
respectively, to affiliates.

The Company received capital contributions of $32,092 and $20,000 from its
parent in 1998 and 1997, respectively.

At December 31, 1999 and 1998, the Company had short-term note payables to
an affiliate of $17,100 and $44,200, respectively. Interest on these notes
ranged from 5.15% to 5.9% at December 31, 1999 and 5.13% to 5.54% at December
31, 1998.

During 1998, the Company purchased life insurance policies covering the
lives of certain employees of the Company. Premiums of $43,500 were paid to an
affiliate for these policies. At December 31, 1999 and 1998, the cash surrender
value of these policies was $47,518 and $45,445, respectively.

62
<PAGE> 65
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
NOTES TO FINANCIAL STATEMENTS -- STATUTORY-BASIS -- (CONTINUED)
(DOLLARS IN THOUSANDS)

11. COMMITMENTS AND CONTINGENCIES

The Company is a party to legal proceedings incidental to its business.
Although such litigation sometimes includes substantial demands for compensatory
and punitive damages in addition to contract liability, it is management's
opinion, after consultation with counsel and a review of available facts, that
damages arising from such demands will not be material to the Company's
financial position.

The Company is subject to insurance guaranty laws in the states in which it
writes business. These laws provide for assessments against insurance companies
for the benefit of policyholders and claimants in the event of insolvency of
other insurance companies. Assessments are charged to operations when received
by the Company except where right of offset against other taxes paid is allowed
by law; amounts available for future offsets are recorded as an asset on the
Company's balance sheet. The future obligation has been based on the most recent
information available from the National Organization of Life and Health
Insurance Guaranty Association. Potential future obligations for unknown
insolvencies are not determinable by the Company. The Company has established a
reserve of $3,498 and $3,489 and an offsetting premium tax benefit of $837 and
$828 at December 31, 1999 and 1998, respectively, for its estimated share of
future guaranty fund assessments related to several major insurer insolvencies.
The guaranty fund expense (credit) was $(20), $(74) and $0 at December 31, 1999,
1998 and 1997, respectively.

12. RECONCILIATION OF CAPITAL AND SURPLUS AND NET INCOME

The following table reconciles capital and surplus and net income as
reported in the 1998 Annual Statement filed with the Insurance Department of the
State of Ohio, to the amounts reported in the accompanying financial statements:

<TABLE>
<CAPTION>
DECEMBER 31, 1998
-------------------------------
TOTAL CAPITAL NET
AND SURPLUS INCOME/(LOSS)
------------- ---------------
<S> <C> <C>
Amounts reported in Annual Statement...................... $148,038 $ 528
Adjustment to federal income tax benefit.................. (4,458) (4,458)
-------- -------
Amounts reported herein................................... $143,580 $(3,930)
======== =======
</TABLE>

63
<PAGE> 66

SCHEDULE I
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
SUMMARY OF INVESTMENTS -- OTHER THAN
INVESTMENTS IN RELATED PARTIES
(DOLLARS IN THOUSANDS)
DECEMBER 31, 1999

<TABLE>
<CAPTION>
AMOUNT AT WHICH
FAIR SHOWN IN THE
TYPE OF INVESTMENT COST(1) VALUE BALANCE SHEET
------------------ -------- -------- ---------------
<S> <C> <C> <C>
FIXED MATURITIES
Bonds:
United States Government and government agencies and
authorities......................................... $ 5,827 $ 5,820 $ 5,827
States, municipalities and political subdivisions...... 7,110 7,275 7,110
Public utilities....................................... 13,134 12,895 13,134
All other corporate bonds.............................. 93,660 93,086 93,660
-------- -------- --------
Total fixed maturities......................... 119,731 119,076 119,731
EQUITY SECURITIES
Common stocks:
Affiliated entities.................................... 243 2,156 2,156
Industrial, miscellaneous and all other................ 302 358 358
-------- -------- --------
Total equity securities........................ 545 2,514 2,514
Mortgage loans on real estate............................ 9,698 9,698
Real estate.............................................. 45,144 45,144
Policy loans............................................. 182,975 182,975
Cash and short-term investments.......................... 23,932 23,932
-------- --------
Total investments.............................. $382,025 $383,994
======== ========
</TABLE>

- ---------------
(1) Original cost of equity securities and, as to fixed maturities, original
cost reduced by repayments and adjusted for amortization of premiums or
accruals of discounts.

64
<PAGE> 67

SCHEDULE III

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
SUPPLEMENTARY INSURANCE INFORMATION
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
FUTURE BENEFITS,
POLICY POLICY CLAIMS,
BENEFITS AND NET LOSSES AND OTHER
AND CONTRACT PREMIUM INVESTMENT SETTLEMENT OPERATING
EXPENSES LIABILITIES REVENUE INCOME* EXPENSES EXPENSES*
-------- ----------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1999
Individual life................. $291,106 $ 9,152 $ 583,656 $10,754 $178,237 $261,284
Group life...................... 11,032 100 1,073 706 1,437 599
Annuity......................... 268,864 17 1,104,525 28,129 651,520 116,006
-------- ------- ---------- ------- -------- --------
$571,002 $ 9,269 $1,689,254 $39,589 $831,194 $377,889
======== ======= ========== ======= ======== ========

YEAR ENDED DECEMBER 31, 1998
Individual life................. $221,050 $ 8,624 $ 474,120 $ 9,884 $122,542 $230,368
Group life...................... 10,546 100 1,933 723 1,962 2,281
Annuity......................... 265,418 509 794,841 25,708 545,532 91,505
-------- ------- ---------- ------- -------- --------
$497,014 $ 9,233 $1,270,894 $36,315 $670,036 $324,154
======== ======= ========== ======= ======== ========

YEAR ENDED DECEMBER 31, 1997
Individual life................. $177,088 $ 9,533 $ 390,452 $13,742 $ 88,738 $176,303
Group life...................... 9,435 805 3,918 810 3,986 3,292
Annuity......................... 296,290 591 822,149 25,461 389,726 83,179
-------- ------- ---------- ------- -------- --------
$482,813 $10,929 $1,216,519 $40,013 $482,450 $262,774
======== ======= ========== ======= ======== ========
</TABLE>

- ---------------
* Allocations of net investment income and other operating expenses are based on
a number of assumptions and estimates, and the results would change if
different methods were applied.

65
<PAGE> 68

SCHEDULE IV

WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO
REINSURANCE
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
ASSUMED PERCENTAGE
CEDED TO FROM OF AMOUNT
GROSS OTHER OTHER NET ASSUMED
AMOUNT COMPANIES COMPANIES AMOUNT TO NET
----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1999
Life insurance in force............ $63,040,741 $11,297,250 $ -- $51,743,494 0.0 %
=========== =========== ========== =========== =====
Premiums:
Individual life............... $ 604,628 $ 20,972 $ -- $ 583,656 0.0 %
Group life.................... 1,383 310 -- 1,073 0.0
Annuity....................... 1,142,254 37,729 -- 1,104,525 0.0
----------- ----------- ---------- ----------- -----
$ 1,748,265 $ 59,011 $ -- $ 1,689,254 0.0 %
=========== =========== ========== =========== =====
YEAR ENDED DECEMBER 31, 1998
Life insurance in force............ $51,064,173 $ 9,862,460 $ -- $41,201,713 0.0 %
=========== =========== ========== =========== =====
Premiums:
Individual life............... $ 493,633 $ 19,512 $ -- $ 474,121 0.0 %
Group life.................... 1,691 220 461 1,932 23.8
Annuity....................... 850,428 55,587 -- 794,841 0.0
----------- ----------- ---------- ----------- -----
$ 1,345,752 $ 75,319 $ 461 $ 1,270,894 .03%
=========== =========== ========== =========== =====
YEAR ENDED DECEMBER 31, 1997
Life insurance in force............ $40,221,361 $ 6,776,447 $2,692,822 $36,137,736 7.5 %
=========== =========== ========== =========== =====
Premiums:
Individual life............... $ 395,361 $ 4,910 $ -- $ 390,452 0.0 %
Group life.................... 1,761 231 2,389 3,918 61.0
Annuity....................... 822,149 -- -- 822,149 0.0
----------- ----------- ---------- ----------- -----
$ 1,219,271 $ 5,141 $ 2,389 $ 1,216,519 0.2 %
=========== =========== ========== =========== =====
</TABLE>

66
<PAGE> 69

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant,
WRL Series Life Corporate Account, certifies that it meets all of the
requirements for effectiveness of this registration statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, and its seal to be hereunto affixed and attested, all in the City of
St. Petersburg and State of Florida on this 14th day of April, 2000.

(SEAL) WRL Series Life Corporate Account
---------------------------------------------------
Registrant

Western Reserve Life Assurance Co. of Ohio
---------------------------------------------------
Depositor

ATTEST:
/s/ THOMAS E. PIERPAN By: /s/ JOHN R. KENNEY
- -------------------------------------------- ------------------------------------------------
Thomas E. Pierpan John R. Kenney
Vice President, Assistant Secretary Chairman of the Board and
and Associate General Counsel Chief Executive Officer
</TABLE>

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE AND TITLE DATE
------------------- ----
<S> <C>

/s/ JOHN R. KENNEY
- -----------------------------------------------------
John R. Kenney, Chairman of the Board and Chief
Executive Officer

/s/ ALLAN J. HAMILTON
- -----------------------------------------------------
Allan J. Hamilton, Vice President, Treasurer and
Controller

/s/ ALAN M. YAEGER
- -----------------------------------------------------
Alan M. Yaeger, Executive Vice President, Actuary and
Chief Financial Officer

/s/ JEROME C. VAHL
- -----------------------------------------------------
Jerome C. Vahl, Director and President

*
- -----------------------------------------------------
James R. Walker, Director

*
- -----------------------------------------------------
Lyman H. Treadway, Director

*
- -----------------------------------------------------
Jack E. Zimmerman, Director

/s/ THOMAS E. PIERPAN April 14, 2000
- -----------------------------------------------------
*Signed by: /s/ Thomas E. Pierpan
as Attorney-in-fact
</TABLE>

<PAGE> 70
PART II.
OTHER INFORMATION

UNDERTAKING TO FILE REPORTS

Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that Section.

REPRESENTATION PURSUANT TO SECTION 26(e) (2) (A)

Western Reserve Life Assurance Co. of Ohio ("Western Reserve") hereby
represents that the fees and charges deducted under the Policies, in the
aggregate, are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by Western Reserve.

STATEMENT WITH RESPECT TO INDEMNIFICATION

Provisions exist under the Ohio General Corporation Law, the Second
Amended Articles of Incorporation of Western Reserve and the Amended Code of
Regulations of Western Reserve whereby Western Reserve may indemnify certain
persons against certain payments incurred by such persons. The following
excerpts contain the substance of these provisions.

Ohio General Corporation Law

SECTION 1701.13 AUTHORITY OF CORPORATION.

(E)(1) A corporation may indemnify or agree to indemnify any person
who was or is a party or is threatened to be made a party, to any threatened,
pending, or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, other than an action by or in the right of
the corporation, by reason of the fact that he is or was a director, officer,
employee, or agent of the corporation, or is or was serving at the request of
the corporation as a director, trustee, officer, employee, or agent of another
corporation (including a subsidiary of this corporation), domestic or foreign,
nonprofit or for profit, partnership, joint venture, trust, or other
enterprise, against expenses, including attorneys' fees, judgments, fines, and
amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit, or proceeding if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit, or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was unlawful.

(2) A corporation may indemnify or agree to indemnify any person
who was or is a party, or is threatened to be made a party to any threatened,
pending, or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, trustee, officer, employee, or
agent of another corporation, domestic or foreign, nonprofit or for profit,
partnership, joint venture, trust, or other enterprise, against expenses,
including attorneys' fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, except that no indemnification shall be
made in respect of any of the following:

1
<PAGE> 71
(a) Any claim, issue, or matter as to which such person
shall have been adjudged to be liable for negligence or misconduct in the
performance of his duty to the corporation unless, and only to the extent that
the court of common pleas, or the court in which such action or suit was
brought determines upon application that, despite the adjudication of
liability, but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses as the court of
common pleas or such other court shall deem proper;

(b) Any action or suit in which the only liability
asserted against a director is pursuant to section 1701.95 of the Revised Code.

(3) To the extent that a director, trustee, officer, employee, or
agent has been successful on the merits or otherwise in defense of any action,
suit, or proceeding referred to in divisions (E)(1) and (2) of this section, or
in defense of any claim, issue, or matter therein, he shall be indemnified
against expenses, including attorneys' fees, actually and reasonably incurred
by him in connection therewith.

(4) Any indemnification under divisions (E)(1) and (2) of this
section, unless ordered by a court, shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of
the director, trustee, officer, employee, or agent is proper in the
circumstances because he has met the applicable standard of conduct set forth
in divisions (E)(1 ) and (2) of this section. Such determination shall be made
as follows:

(a) By a majority vote of a quorum consisting of
directors of the indemnifying corporation who were not and are not parties to
or threatened with any such action, suit, or proceeding;

(b) If the quorum described in division (E)(4)(a) of this
section is not obtainable or if a majority vote of a quorum of disinterested
directors so directs, in a written opinion by independent legal counsel other
than an attorney, or a firm having associated with it an attorney, who has been
retained by or who has performed services for the corporation, or any person to
be indemnified within the past five years;

(d) By the court of common pleas or the court in which
such action, suit, or proceeding was brought.

Any determination made by the disinterested directors under division
(E)(4)(a) or by independent legal counsel under division (E)(4)(b) of this
section shall be promptly communicated to the person who threatened or brought
the action or suit by or in the right of the corporation under division (E)(2)
of this section, and within ten days after receipt of such notification, such
person shall have the right to petition the court of common pleas or the court
in which such action or suit was brought to review the reasonableness of such
determination.

(5)(a) Unless at the time of a director's act or omission that is the
subject of an action, suit or proceeding referred to in divisions (E)(1) and
(2) of this section, the articles or the regulations of a corporation state by
specific reference to this division that the provisions of this division do not
apply to the corporation and unless the only liability asserted against a
director in an action, suit, or proceeding referred to in divisions (E)(1) and
(2) of this section is pursuant to section 1701.95 of the Revised Code,
expenses, including attorney's fees, incurred by a director in defending the
action, suit, or proceeding shall be paid by the corporation as they are
incurred, in advance of the final disposition of the action, suit, or
proceeding upon receipt of an undertaking by or on behalf of the director in
which he agrees to do both of the following:

(i) Repay such amount if it is proved by
clear and convincing evidence in a court of competent jurisdiction that his
action or failure to act involved an act or omission

2
<PAGE> 72
undertaken with deliberate intent to cause injury to the corporation or
undertaken with reckless disregard for the best interests of the corporation;

(ii) Reasonably cooperate with the
corporation concerning the action, suit, or proceeding.

(b) Expenses, including attorneys' fees incurred by a
director, trustee, officer, employee, or agent in defending any action, suit,
or proceeding referred to in divisions (E)(1) and (2) of this section, may be
paid by the corporation as they are incurred, in advance of the final
disposition of the action, suit, or proceeding as authorized by the directors
in the specific case upon receipt of an undertaking by or on behalf of the
director, trustee, officer, employee, or agent to repay such amount, if it
ultimately is determined that he is entitled to be indemnified by the
corporation.

(6) The indemnification authorized by this section shall not be
exclusive of, and shall be in addition to, any other rights granted to those
seeking indemnification under the articles or the regulations or any agreement,
vote of shareholders or disinterested directors, or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased to be a
director, trustee, officer, employee, or agent and shall inure to the benefit
of the heirs, executors, and administrators of such a person.

(7) A corporation may purchase and maintain insurance or furnish
similar protection, including but not limited to trust funds, letters of
credit, or self-insurance on behalf of or for any person who is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, trustee, officer, employee, or
agent of another corporation, domestic or foreign, nonprofit or for profit,
partnership, joint venture, trust, or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or arising out
of his status as such, whether or not the corporation would have the power to
indemnify him against such liability under this section. Insurance may be
purchased from or maintained with a person in which the corporation has a
financial interest.

(8) The authority of a corporation to indemnify persons pursuant
to divisions (E)(1 ) and (2) of this section does not limit the payment of
expenses as they are incurred, indemnification, insurance, or other protection
that may be provided pursuant to divisions (E)(5), (6), and (7) of this
section. Divisions (E)(1) and (2) of this section do not create any obligation
to repay or return payments made by the corporation pursuant to divisions
(E)(5), (6), or (7).

(9) As used in this division, references to "corporation" include
all constituent corporations in a consolidation or merger and the new or
surviving corporation, so that any person who is or was a director, officer,
employee, or agent of such a constituent corporation, or is or was serving at
the request of such constituent corporation as a director, trustee, officer,
employee or agent of another corporation, domestic or foreign, nonprofit or for
profit, partnership, joint venture, trust, or other enterprise, shall stand in
the same position under this section with respect to the new or surviving
corporation as he would if he had served the new or surviving corporation in
the same capacity.

Second Amended Articles of Incorporation of Western Reserve

ARTICLE EIGHTH

EIGHTH: (1) The corporation may indemnify or agree to indemnify any
person who was or is a party or is threatened to be made a party, to any
threatened, pending, or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, other than an action by or in the
right of the corporation, by reason of the fact that he is or was a director,
officer, employee, or agent of the corporation, or is or was serving at the
request of the corporation as a director, trustee, officer, employee, or agent
of another corporation (including a subsidiary of this corporation), domestic
or foreign, nonprofit

3
<PAGE> 73
or for profit, partnership, joint venture, trust, or other enterprise, against
expenses, including attorneys' fees, judgments, fines, and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit, or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit, or proceeding by judgment, order, settlement, conviction, or upon
a plea of nolo contendere or its equivalent, shall not, of itself create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.

(2) The corporation may indemnify or agree to indemnify any person
who was or is a party, or is threatened to be made a party to any threatened,
pending, or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, trustee, officer, employee, or
agent of another corporation (including a subsidiary of this corporation),
domestic or foreign, nonprofit or for profit, partnership, joint venture,
trust, or other enterprise against expenses, including attorneys' fees,
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, except that no indemnification shall be made in respect of any
claim, issue, or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty to the
corporation unless, and only to the extent that the court of common pleas, or
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability, but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the court of common pleas or such other court
shall deem proper.

(3) To the extent that a director, trustee, officer, employee, or
agent has been successful on the merits or otherwise in defense of any action,
suit, or proceeding referred to in sections (1) and (2) of this article, or in
defense of any claim, issue, or matter therein, he shall be indemnified against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection therewith.

(4) Any indemnification under sections (1) and (2) of this
article, unless ordered by a court, shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of
the director, trustee, officer, employee, or agent is proper in the
circumstances because he has met the applicable standard of conduct set forth
in sections (1) and (2) of this article. Such determination shall be made (a)
by a majority vote of a quorum consisting of directors of the indemnifying
corporation who were not and are not parties to or threatened with any such
action, suit, or proceeding, or (b) if such a quorum is not obtainable or if a
majority vote of a quorum of disinterested directors so directs, in a written
opinion by independent legal counsel other than an attorney, or a firm having
associated with it an attorney, who has been retained by or who has performed
services for the corporation, or any person to be indemnified within the past
five years, or (c) by the shareholders, or (d) by the court of common pleas or
the court in which such action, suit, or proceeding was brought. Any
determination made by the disinterested directors under section (4)(a) or by
independent legal counsel under section (4)(b) of this article shall be
promptly communicated to the person who threatened or brought the action or
suit by or in the right of the corporation under section (2) of this article,
and within ten days after receipt of such notification, such person shall have
the right to petition the court of common pleas or the court in which such
action or suit was brought to review the reasonableness of such determination.

(5) Expenses, including attorneys' fees incurred in defending any
action, suit, or proceeding referred to in sections (1) and (2) of this
article, may be paid by the corporation in advance of the final disposition of
such action, suit, or proceeding as authorized by the directors in the specific
case upon receipt of a written undertaking by or on behalf of the director,
trustee, officer, employee, or agent to repay such amount, unless it shall
ultimately be determined that he is entitled to be indemnified by the

4
<PAGE> 74
corporation as authorized in this article. If a majority vote of a quorum of
disinterested directors so directs by resolution, said written undertaking need
not be submitted to the corporation. Such a determination that a written
undertaking need not be submitted to the corporation shall in no way affect the
entitlement of indemnification as authorized by this article.

(6) The indemnification provided by this article shall not be
deemed exclusive of any other rights to which those seeking indemnification may
be entitled under the articles or the regulations or any agreement, vote of
shareholders or disinterested directors, or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
trustee, officer, employee, or agent and shall inure to the benefit of the
heirs, executors, and administrators of such a person.

(7) The Corporation may purchase and maintain insurance on behalf
of any person who is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a
director, trustee, officer, employee, or agent of another corporation
(including a subsidiary of this corporation), domestic or foreign, nonprofit or
for profit, partnership, joint venture, trust, or other enterprise against any
liability asserted against him and incurred by him in any such capacity or
arising out of his status as such, whether or not the corporation would have
the power to indemnify him against such liability under this section.

(8) As used in this section, references to "the corporation"
include all constituent corporations in a consolidation or merger and the new
or surviving corporation, so that any person who is or was a director, officer,
employee, or agent of such a constituent corporation, or is or was serving at
the request of such constituent corporation as a director, trustee, officer,
employee or agent of another corporation (including a subsidiary of this
corporation), domestic or foreign, nonprofit or for profit, partnership, joint
venture, trust, or other enterprise shall stand in the same position under this
article with respect to the new or surviving corporation as he would if he had
served the new or surviving corporation in the same capacity.

(9) The foregoing provisions of this article do not apply to any
proceeding against any trustee, investment manager or other fiduciary of an
employee benefit plan in such person's capacity as such, even though such
person may also be an agent of this corporation. The corporation may indemnify
such named fiduciaries of its employee benefit plans against all costs and
expenses, judgments, fines, settlements or other amounts actually and
reasonably incurred by or imposed upon said named fiduciary in connection with
or arising out of any claim, demand, action, suit or proceeding in which the
named fiduciary may be made a party by reason of being or having been a named
fiduciary, to the same extent it indemnifies an agent of the corporation. To
the extent that the corporation does not have the direct legal power to
indemnify, the corporation may contract with the named fiduciaries of its
employee benefit plans to indemnify them to the same extent as noted above. The
corporation may purchase and maintain insurance on behalf of such named
fiduciary covering any liability to the same extent that it contracts to
indemnify.

Amended Code of Regulations of Western Reserve

ARTICLE V

Indemnification of Directors and Officers

Each Director, officer and member of a committee of this Corporation,
and any person who may have served at the request of this Corporation as a
Director, officer or member of a committee of any other corporation in which
this Corporation owns shares of capital stock or of which this Corporation is a
creditor (and his heirs, executors and administrators) shall be indemnified by
the Corporation against all expenses, costs, judgments, decrees, fines or
penalties as provided by, and to the extent allowed by, Article Eighth of the
Corporation's Articles of Incorporation, as amended.

5
<PAGE> 75
RULE 484 UNDERTAKING

Insofar as indemnification for liability arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel, the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

CONTENTS OF REGISTRATION STATEMENT

This registration statement comprises the following papers and documents:

The facing sheet
The Prospectus, consisting of 70 pages
The undertaking to file reports
Representation Pursuant to Section 26(e) (2) (A)
The statement with respect to indemnification
The Rule 484 undertaking
The signatures

Written consent of the following persons:

(a) Sutherland Asbill & Brennan LLP
(b) Ernst & Young LLP
(c) Kenneth Turnquist
(d) Thomas E. Pierpan

The following exhibits:

1. The following exhibits correspond to those required by paragraph A to
the instructions as to exhibits in Form N-8B-2:

A. (1) Resolution of the Board of Directors of Western
Reserve establishing the Separate Account *
(2) Not Applicable
(3) (a) Principal Underwriting Agreement *
(b) Selected Broker Agreement *
(4) Not Applicable
(5) Specimen Variable Adjustable Life Insurance Policy *
(6) (a) Second Amended Articles of Incorporation of
Western Reserve **
(b) Amended Code of Regulations (By-Laws) of
Western Reserve **
(7) Not Applicable
(8) (a) Participation Agreement regarding BT
Insurance Funds Trust ***
(b)(i) Participation Agreement regarding Fidelity
Variable Insurance Products Fund *****
(ii) Participation Agreement regarding Fidelity
Variable Insurance Products Fund II *****
(iii) Participation Agreement regarding Fidelity
Variable Insurance Products Fund III *****
(c) Participation Agreement regarding PIMCO
Variable Insurance Trust *****
(d) Participation Agreement regarding T. Rowe
Price Equity Series, Inc. and T. Rowe Price
International Series, Inc. *****
(e) Participation Agreement regarding Janus Aspen
Series *****

(f) Participation Agreement regarding INVESCO
Variable Investment Funds, Inc. ****

(9) Not Applicable
(10) Application for Variable Adjustable Life Insurance
Policy *
(11) Memorandum describing issuance, transfer and
redemption procedures ***
2. Opinion of Counsel as to the legality of the securities being
registered *

6
<PAGE> 76

3. Not Applicable
4. Not Applicable

5. Opinion and consent as to actuarial matters pertaining to the
securities being registered

6. Consent of Sutherland Asbill & Brennan LLP

7. Consent of Ernst & Young LLP

8.(a) Powers of Attorney ***

8(b) Power of attorney for Jerome C. Vahl

- ----------------------------------
* Incorporated herein by reference to the initial filing of this Form
S-6 registration statement on June 25, 1998 (File No. 333-57681).

** Incorporated herein by reference to Post-Effective Amendment No. 11 to
Form N-4 Registration Statement dated April 20, 1998 (File No.
33-49556).

*** Incorporated herein by reference to Pre-Effective Amendment No. 1 to
Form S-6 Registration Statement filed November 2, 1998 (File No.
333-57681)

**** Incorporated herein by reference to Post-Effective Amendment No. 4 to
Form S-6 registration statement filed November 10, 1999. (File No.
333-57681)

***** Incorporated herein by reference to Post-Effective Amendment No. 3 to
Form S-6 registration statement filed September 23, 1999. (File No.
333-57681)
7
<PAGE> 77
Exhibit Index

<TABLE>
<CAPTION>
Exhibit Description
No. of Exhibit
- ------- ----------
<S> <C>
5. Opinion and consent as to actuarial
matters
6. Consent of Sutherland Asbill & Brennan LLP
7. Consent of Ernst & Young LLP
8(b) Power of attorney for Jerome C. Vahl
</TABLE>

<PAGE> 1
EXHIBIT 5

[Letterhead of WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO]

April 25, 2000

Western Reserve Life Assurance co. of Ohio
PO Box 5068
Clearwater, FL 33758-5068

RE: WRL Series Life Corporate Account (File No. 333-57681)

Gentlemen:

This opinion is furnished in connection with the Post-Effective Amendment No. 5
to the registration by Western Reserve Life Assurance Co. of Ohio of flexible
premium variable life insurance policies ("Policies") under the Securities Act
of 1933. The prospectus included in Post-Effective Amendment No. 5 in the
Registration Statement on Form S-6 describes the Policies. The forms of Policies
were prepared under my direction, and I am familiar with the Registration
Statement and Exhibits thereof.

In my opinion, the illustrations of life insurance benefits, cash values and net
surrender values included in the section entitled "Illustrations of Cash Value,
Net Cash Value and Life Insurance Benefits" of the prospectus, based on the
assumptions stated in the illustrations, are consistent with the provisions of
the respective forms of the Policies.

I hereby consent to use of this opinion as an exhibit to post-effective
amendment no. 5 to the Registration Statement and to the reference to my name
under the heading "Experts" in the prospectus.

Very truly yours,

/s/ Kenneth Turnquist
Kenneth Turnquist

<PAGE> 1
EXHIBIT 6

[Letterhead of SUTHERLAND ASBILL & BRENNAN LLP]

April 25, 2000

Western Reserve Life Assurance Co. of Ohio
570 Carillon Parkway
St. Petersburg, Florida 33716

Re: WRL Series Life Corporate Account (File No. 333-57681)

Gentlemen:

We hereby consent to the reference to our name under the caption "Legal
Matters" in the prospectus filed as part of Post-Effective Amendment No. 5 to
the registration statement on Form S-6 for WRL Series Life Corporate Account
(File No. 333-57681). In giving this consent, we do not admit that we are in the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933.

Sincerely,

SUTHERLAND ASBILL & BRENNAN LLP

By: /s/ STEPHEN E. ROTH
----------------------------
Stephen E. Roth, Esq.

<PAGE> 1

Exhibit 7

Consent of Independent Auditors

We consent to the reference to our firm under the caption "Experts" and to the
use of our report dated February 18, 2000 with respect to the statutory-basis
financial statements and schedules of Western Reserve Life Assurance Co. of
Ohio, included in Post-Effective Amendment No. 5 to the Registration Statement
(Form S-6 No. 333-57681) and related Prospectus of WRL Series Life Corporate
Account.

/s/ Ernst & Young

Des Moines, Iowa
April 24, 2000

<PAGE> 1
Exhibit 8(b)

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby makes,
constitutes and appoints THOMAS E. PIERPAN, WILLIAM H. GEIGER, PRISCILLA HECHLER
and ALAN M. YAEGER, and each of them, severally, his true and lawful attorneys
and agents in his name, place and stead and on his behalf (a) to sign and cause
to be filed registration statements of WRL Series Life Corporate Account under
the Securities Act of 1933 and the Investment Company Act of 1940, and all
amendments, consents and exhibits thereto; (b) to withdraw such statements or
any amendments or exhibits and make requests for acceleration in connection
therewith; (c) to take all other action of whatever kind or nature in connection
with such registration statements which said attorneys may deem advisable; and
(d) to make, file, execute, amend and withdraw documents of every kind, and to
take other action of whatever kind they may elect, for the purpose of complying
with the laws of any state relating to the sale of securities of the Fund,
hereby ratifying and confirming all actions of any of said attorneys hereunder.
Said attorneys may act jointly or severally, and the action of one shall bind
the undersigned as fully as if two or more had acted together.

Signature Date

/s/ Jerome C. Vahl April 17, 2000
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Jerome C. Vahl