<PAGE>
As filed with the Securities and Exchange Commission on April 13, 2000.
File No. 333-65507
811-9045
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 1 [ X ]
---
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 2 [ X ]
---
SEPARATE ACCOUNT ONE
(Exact Name of Registrant)
HART LIFE INSURANCE COMPANY
(formerly Alpine Life Insurance Company)
(Name of Depositor)
P. O. BOX 2999
HARTFORD, CT 06104-2999
(Address of Depositor's Principal Offices)
(860) 843-6320
(Depositor's Telephone Number, Including Area Code)
THOMAS S. CLARK, ESQ.
HART LIFE INSURANCE COMPANY
P. O. BOX 2999
HARTFORD, CT 06104-2999
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
immediately upon filing pursuant to paragraph (b) of Rule 485
------
X on May 1, 2000 pursuant to paragraph (b) of Rule 485
------
60 days after filing pursuant to paragraph (a)(1) of Rule 485
------
on _______, 1999 pursuant to paragraph (a)(1) of Rule 485
------
this post-effective amendment designates a new effective date
------ for a previously filed post-effective amendment.
PURSUANT TO RULE 24F-2(a)(1) UNDER THE INVESTMENT COMPANY ACT OF 1940, THE
REGISTRANT HAS REGISTERED AN INDEFINITE AMOUNT OF SECURITIES.
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of the registration statement.
<PAGE>
CROSS REFERENCE SHEET
PURSUANT TO RULE 495(a)
-----------------------
N-4 Item No. Prospectus Heading
------------ ------------------
1. Cover Page Hart Life Insurance Company;
Separate Account One
2. Definitions Glossary of Special Terms
3. Synopsis or Highlights Summary
4. Condensed Financial Information Performance of the Funds
5. General Description of Registrant, About Us
Depositor, and Portfolio Companies
6. Deductions Charges
7. General Description of Variable Annuity Your Annuity
Contracts
8. Annuity Period Settlement Provisions
9. Death Benefit Death Benefits
10. Purchases and Contract Value Payments; Contract Value
11. Redemptions Withdrawals
12. Taxes Federal Tax Considerations
13. Legal Proceedings Legal Matters and Experts
14. Table of Contents of the Statement Table of Contents of the
of Additional Information Statement of Additional
Information
15. Cover Page Part B: Statement of
Additional Information
16. Table of Contents Table of Contents
17. General Information and History Introduction
18. Services Independent Public Accountants
19. Purchases of Securities Being Offered Distribution of the Contracts
20. Underwriters Distribution of the Contracts
21. Calculation of Performance Data Calculation of Yield and
Return
22. Annuity Payments N/A
23. Financial Statements Financial Statements
24. Financial Statements and Exhibits Financial Statements and
Exhibits
25. Directors and Officers of the Depositor Directors and Officers of the
Depositor
26. Persons Controlled by or Under Common Persons Controlled by or Under
Control with the Depositor or Registrant Common Control with the
Depositor or Registrant
27. Number of Contract Owners Number of Contract Owners
28. Indemnification Indemnification
29. Principal Underwriters Principal Underwriters
30. Location of Accounts and Records Location of Accounts and
Records
31. Management Services Management Services
32. Undertakings Undertakings
<PAGE>
Part A
<PAGE>
5
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
SEPARATE ACCOUNT ONE
P. O. Box 5085
Hartford, Connecticut 06102-5085
Telephone: 1-800-862-6668
This Prospectus describes information you should know before you purchase our
variable annuity. Please read it carefully.
The variable annuity is a contract between you and Hart Life Insurance
Company where you agree to make payments to us and we agree to make a series
of payments to you at a later date. It is a flexible premium, tax-deferred,
variable annuity offered to both individuals and groups. It is:
- Flexible, because you may add payments at any time.
- Tax-deferred, which means you don't pay taxes until you take payments
out or until we start to make payments to you.
- Variable, because the value of your annuity will fluctuate with
the performance of the stock market.
After purchase, you allocate your payments to "Sub-Accounts" or subdivisions of
our Separate Account, an account that keeps your annuity assets separate from
our company assets. These Sub-Accounts then purchase shares of mutual funds set
up exclusively for variable annuity or variable life insurance products. These
funds are not the same mutual funds that you buy through your stockbroker or
through a retail mutual fund, but they may have similar investment strategies
and the same portfolio managers as retail mutual funds. This annuity offers you
funds with investment strategies ranging from conservative to aggressive and you
may pick those funds that meet your investment style. The Sub-Accounts and the
funds are listed below:
- - Hartford Bond HLS Fund Sub-Account which purchases shares of Class IA of
Hartford Bond HLS Fund, Inc.
- - Hartford High Yield HLS Fund Sub-Account which purchases shares of Class IA of
Hartford High Yield HLS Fund of Hartford Series Fund, Inc.
- - Hartford Index HLS Fund Sub-Account which purchases shares of Class IA of
Hartford Index HLS Fund, Inc.
<PAGE>
6
- - Hartford Money Market HLS Fund Sub-Account which purchases shares of Class IA
of Hartford Money Market HLS Fund, Inc.
- - Hartford Mortgage Securities HLS Fund Sub-Account which purchases shares of
Class IA of Hartford Mortgage Securities HLS Fund, Inc.
You may also allocate some or all of your payments to the "Fixed Account", which
pays an interest rate guaranteed for at least one year from the time the payment
is made. Payments put in the Fixed Account are not segregated from our assets
like the assets of the Separate Account.
If you decide to buy this annuity, you should keep this prospectus for your
records. You can also call us at 1-800-862-6668 to get a Statement of
Additional Information, free of charge. The Statement of Additional
Information contains more information about this annuity and, like this
prospectus, is filed with the Securities and Exchange Commission. You should
read the Statement of Additional Information because you are bound by the
terms contained in it. We have included the Table of Contents for the
Statement of Additional Information at the end of this Prospectus. Although
we file the Prospectus and the Statement of Additional Information with the
Securities and Exchange Commission, the Commission doesn't approve or
disapprove these securities or determine if the information is truthful or
complete. Anyone who represents that the Securities and Exchange Commission
does these things may be guilty of a criminal offense.
This Prospectus and the Statement of Additional Information can also be obtained
from the Securities and Exchange Commissions' website (HTTP://WWW.SEC.GOV).
This annuity IS NOT:
- - a bank deposit or obligation
- - federally insured
- - endorsed by any bank or governmental agency
- - available for sale in all states
Prospectus Dated: May 1, 2000
Statement of Additional Information Dated: May 1, 2000
<PAGE>
7
Table Of Contents
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Glossary of Special Terms . . . . . . . . . . . . . . . . . . . . 8
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
About Us. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Hart Life Insurance Company. . . . . . . . . . . . . . . . . 15
Separate Account . . . . . . . . . . . . . . . . . . . . . . 15
The Funds. . . . . . . . . . . . . . . . . . . . . . . . . . 16
The Fixed Account. . . . . . . . . . . . . . . . . . . . . . 18
Performance of the Funds. . . . . . . . . . . . . . . . . . . . . 19
Your Annuity. . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Contract Value . . . . . . . . . . . . . . . . . . . . . . . 21
Transfers. . . . . . . . . . . . . . . . . . . . . . . . . . 22
Charges. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Death Benefits . . . . . . . . . . . . . . . . . . . . . . . 26
Withdrawals. . . . . . . . . . . . . . . . . . . . . . . . . 28
Settlement Provisions . . . . . . . . . . . . . . . . . . . . . . 29
Other Information . . . . . . . . . . . . . . . . . . . . . . . . 33
Federal Tax Considerations. . . . . . . . . . . . . . . . . . . . 34
General. . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Taxation of Hart Life and the Separate Account . . . . . . . 34
Taxation of Annuities - General Provisions Affecting
Purchasers other than Qualified Retirement Plans. . . . 34
Federal Income Tax Withholding . . . . . . . . . . . . . . . 41
General Provisions Affecting Qualified Retirement Plans. . . 41
Annuity Purchases by Nonresident Aliens and Foreign
Corporations . . . . . . . . . . . . . . . . . . . . . 41
Generation-Skipping Transfers. . . . . . . . . . . . . . . . 41
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . 41
How we Sell our Annuity. . . . . . . . . . . . . . . . . . . . 41
Legal Matters and Experts. . . . . . . . . . . . . . . . . . . 42
Additional Information. . . . . . . . . . . . . . . . . . . . . . 43
Appendix I Information Regarding Tax-Qualified Plans. . . . . . . 44
Table of Contents to Statement of Additional Information. . . . . 50
</TABLE>
<PAGE>
8
Glossary of Special Terms
Accumulation Unit: A unit of measure we use to calculate values before we begin
to make payments to you.
Administrative Office of Hart Life: Located at 200 Hopmeadow Street,
Simsbury, CT 06089.
Annual Maintenance Fee: An annual $30 charge for annuities having a value of
less than $50,000 on the most recent Contract Anniversary or when the annuity is
surrendered in full. The charge is deducted proportionately from the investment
options in use at the time.
Annual Withdrawal Amount: The amount that can be withdrawn in any Contract Year
before we charge you a surrender charge.
Annuitant: The person on whose life the Contract is issued. The Annuitant may
not be changed.
Annuity Commencement Date: The date we start to make payments to you.
Annuity Unit: A unit of measure we use to calculate the value of the payments we
make to you.
Beneficiary: The person entitled to receive the payment of the death benefit
upon the death of you or the Annuitant.
Code: The Internal Revenue Code of 1986, as amended.
Commission: The Securities and Exchange Commission.
Contingent Annuitant: The person you may designate who becomes the Annuitant if
the original Annuitant dies before we start making payments to you.
Contract: The contract is the individual annuity and any endorsements or
riders. If you are enrolled under a group annuity, you receive a certificate
rather than a contract.
Contract Anniversary: The anniversary of the Contract Date.
Contract Owner or You: The owner of the annuity.
Contract Value: The total value of your Sub-Accounts plus any amounts you have
in the Fixed Account.
<PAGE>
9
Contract Year: A period of 12 months commencing with the Contract Date the first
year and the Contract Anniversary after the first year.
Death Benefit: The amount we pay when you or the Annuitant dies.
Due Proof of Death: A certified copy of a death certificate, an order of a court
of competent jurisdiction, a statement from a physician who attended the
deceased or any other proof acceptable to Hart Life.
Fixed Account: This is an account which is part of our General Account and you
may allocate all or a portion of your payments or Contract Value to this
account.
Funds: The Funds described in this Prospectus and any supplements.
General Account: Our General Account that is all our assets other than the
assets in our separate accounts.
Hart Life (or us): Hart Life Insurance Company.
Maximum Anniversary Value: One of the values we use to determine your Death
Benefit. It is determined annually on your anniversary date and is equal to the
highest value your annuity reached on any annuity anniversary date. The maximum
anniversary value is calculated only up to age 80, and we use that value each
year after age 80 as your maximum anniversary value.
Premium Tax: A tax charged by a state or municipality on premium payments.
Separate Account: For this annuity, the separate account is Separate
Account One of Hart Life Insurance Company.
Sub-Account: Divisions established within the Separate Account.
Termination Value: What we pay you if you terminate your annuity before we begin
to make payments to you.
Valuation Day: Every day the New York Stock Exchange is open for trading. The
value of the Separate Account is determined as of the close of the New York
Stock Exchange (generally 4:00 p.m. Eastern Time).
Valuation Period: The period between the close of business on successive
Valuation Days.
<PAGE>
10
FEE TABLE
CONTRACT OWNER TRANSACTION EXPENSES
<TABLE>
<S> <C>
SALES CHARGE IMPOSED ON PURCHASES (as a percentage of Premium Payments).......... None
CONTINGENT DEFERRED SALES CHARGE (as a percentage of amounts Surrendered) (1)
First Year (2).......................................................... 6%
Second Year............................................................. 6%
Third Year.............................................................. 5%
Fourth Year............................................................. 5%
Fifth Year.............................................................. 4%
Sixth Year.............................................................. 3%
Seventh Year............................................................ 2%
Eighth Year............................................................. 0%
ANNUAL MAINTENANCE FEE (3)........................................................... $30
SEPARATE ACCOUNT ANNUAL EXPENSES (as a percentage of average daily Sub-Account Value)
MORTALITY AND EXPENSE RISK CHARGE........................................... 1.25%
Total Separate Account Annual Expenses............................................... 1.25%
</TABLE>
------------
1) Each Premium Payment has its own Contingent Deferred Sales Charge
schedule. See "Charges and Fees -- The Contingent Deferred Sales
Charge." The Contingent Deferred Sales Charge is not assessed on
partial Surrenders which do not exceed the Annual Withdrawal
Amount.
2) Length of time from each Premium Payment.
3) An annual $30 charge deducted on a Contract Anniversary or upon
Surrender if the Contract Value at either of those times is less
than $50,000. It is deducted proportionately from the Accounts in
which you are invested at the time of the charge.
The purpose of the Fee Table and Examples is to assist you in understanding
various costs and expenses that you will pay directly or indirectly. The Fee
Table and Examples reflect expenses of the Separate Account and underlying
Funds. We will deduct any Premium Taxes that apply.
The Examples should not be considered a representation of past or future
expenses and actual expenses may be greater or less than those shown. The Annual
Maintenance Fee has been reflected in the Examples by a method intended to show
the "average" impact of the Annual Maintenance Fee on an investment in the
Separate Account. We do this by approximating an "average" 0.06% annual charge.
<PAGE>
11
ANNUAL FUND OPERATING EXPENSES
AS OF THE FUND'S YEAR END
(As a percentage of net assets)
<TABLE>
<CAPTION>
TOTAL FUND
OPERATING
MANAGEMENT OTHER EXPENSES
FEES EXPENSES (INCLUDING ANY
(INCLUDING ANY (INCLUDING ANY WAIVERS AND ANY
WAIVERS) REIMBURSEMENTS) REIMBURSEMENTS)
<S> <C> <C> <C>
Hartford Bond HLS Fund 0.49% 0.03% 0.52%
Hartford High Yield HLS Fund 0.66% 0.06% 0.72%
Hartford Index HLS Fund 0.40% 0.03% 0.43%
Hartford Money Market HLS Fund 0.45% 0.02% 0.47%
Hartford Mortgage Securities HLS Fund 0.45% 0.03% 0.48%
</TABLE>
EXAMPLE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
If you Surrender your Contract at If you annuitize your Contract at the If you do not Surrender your
the end of the applicable time end of the applicable time period you Contract, you would pay the
period you would pay the following would pay the following expenses on a following expenses on a $1,000
expenses on a $1,000 investment, $1,000 investment, assuming a 5% investment, assuming a 5% annual
assuming a 5% annual return on annual return on assets: return on assets:
assets:
- ------------------------------------------------------------------------------------------------------------------------------------
SUB-ACCOUNT 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ----------- ------ ------- ------- -------- ------ ------- ------- -------- ------ ------- ------- --------
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Hartford Bond $74 $107 $140 $216 $18 $57 $99 $215 $19 $58 $100 $216
HLS Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Hartford High
Yield HLS Fund 76 113 150 238 20 64 110 237 21 64 110 238
- ------------------------------------------------------------------------------------------------------------------------------------
Hartford Index
HLS Fund 73 105 135 207 17 55 94 206 18 55 95 207
- ------------------------------------------------------------------------------------------------------------------------------------
Hartford Money
Market HLS Fund 73 106 137 211 18 56 97 210 18 56 97 211
- ------------------------------------------------------------------------------------------------------------------------------------
Hartford
Mortgage 74 106 138 212 18 56 97 211 18 57 98 212
Securities HLS
Fund
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
12
SUMMARY
How do I purchase the annuity?
You must complete our enrollment form and submit it to us for approval with
your first payment. Your first payment must be at least $1,000 and
subsequent payments must be at least $500. If you wish to make automatic
monthly payments into your annuity, you may enroll in our pre-authorized
checking program. Under this program, your subsequent monthly payments can
be as low as $50.
For a limited time, usually ten days after you receive your annuity, you may
cancel your annuity without paying a sales charge.
What type of sales charge will I pay?
You don't pay a sales charge when you purchase your annuity. We may charge
you a deferred sales charge when you terminate or withdraw amounts invested in
your annuity. We assess a sales charge on amounts withdrawn that exceed 10%
of the total amounts you have paid into your annuity if these amounts have
been in your annuity for less than seven years. The sales charge is applied
to amounts withdrawn that exceed 10% of the total amounts paid in and will
depend on the length of time the payment you made has been in your annuity.
If the amount you paid has been in your annuity:
X For less than two years, the charge is 6%.
X For more than two years and less than four years, the charge is 5%.
X For more than four years and less than five years, the charge is 4%.
X For more than five years and less than six years, the charge is 3%
X For more than six years and less than seven years, the charge is 2%.
You won't be charged a sales charge on:
X Payments that have been in your annuity for more than seven years.
X distributions made due to death
X most payments we make to you as part of your annuity payments
See "Contingent Deferred Sales Charge" for a complete description of how
sales charges are assessed.
Is there an Annual Maintenance Fee?
Yes. We deduct a $30.00 fee each year on the anniversary of your purchase or
when you terminate your annuity, if the value of your annuity is less than
$50,000.
What charges will I pay on an annual basis?
You pay two different types of charges each year. The first type of charge is
the fee you pay for insurance. This charge is:
<PAGE>
13
- - A mortality and expense risk charge that is subtracted daily and is equal to
an annual payment of 1.25% of your money invested in the funds.
The second type of charge is the fee you pay for the funds. The current
annual insurance charges and the total fund charges are set forth in the
table below:
<TABLE>
<CAPTION>
THE SUB-ACCOUNTS ANNUAL ANNUAL
INSURANCE MAINTENANCE ANNUAL TOTAL TOTAL CHARGES
CHARGE FEE(1) FUND CHARGES(2) YOU PAY
<S> <C> <C> <C> <C>
Hartford Bond HLS Fund Sub-Account 1.25% .06% 0.52% 1.83%
Hartford Index HLS Fund Sub-Account 1.25% .06% 0.43% 1.74%
Hartford High Yield HLS Fund Sub-Account 1.25% .06% 0.72% 2.03%
Hartford Money Market HLS Fund Sub-Account 1.25% .06% 0.47% 1.78%
Hartford Mortgage Securities HLS Fund Sub-Account 1.25% .06% 0.48% 1.79%
</TABLE>
(1) The actual Annual Maintenance Fee is a $30.00 fee. The Annual Maintenance
Fee has been reflected using a method intended to show the "average"
impact of the Annual Maintenance Fee. In the table, the Annual Maintenance
Fee is approximately a 0.06% annual charge.
(2) The figure that appears in the "Annual Total Fund Charges" column
illustrates the sum of the management fees and other expenses that the
funds charge. The figures reflect any fees that may have been waived by
the funds' investment advisers. For more information, see the funds'
prospectuses in the back of this book.
<PAGE>
14
Can I take out any of my money?
/ / You may withdraw all or part of the amounts you have invested at any time
before we start making payments to you.
/ / Each year you may withdraw up to 10% of your payments without having to
pay a sales charge.
You may have to pay tax on the money you take out and, if you take money out
before you are 59 1/2 you may have to pay a tax penalty.
Will we pay a Death Benefit?
There is a Death Benefit if you, your joint owner or your annuitant (the person
on whose life this annuity is based), dies before we begin to make payments to
you. The death benefit will be determined as of the date we receive acceptable
proof of death and will be the greater of:
- - The total payments you have made to us minus any amounts you have taken out,
or
- - The total value of your annuity, or
- - Your maximum anniversary value, which is the highest value your annuity
reached on any annuity anniversary date up to age 80, reduced by any
subsequent withdrawals and increased by any subsequent payments.
What payment options are available?
When it comes time for us to pay you, you may choose one of the following
annuity payment options, or receive a lump sum:
- Life Annuity where we make scheduled payments to you for the rest of
your life.
Payments under this option stop upon the death of the annuitant, even if the
annuitant dies after one payment.
- Life Annuity with 120, 180 or 240 Monthly Payments Certain where we
make payments to you for your life but you are at least guaranteed
payments for 120, 180 or 240 months, whichever you select. If the
annuitant dies before the end of the period selected, we will continue
to make payments to your beneficiary until the end of the period
selected.
- Joint and Last Survivor Annuity where we make payments during the
lifetime of you and another designated individual and then throughout
the remaining lifetime of the survivor.
- Payments for a Designated Period where we make payments for a specified
time between 5 and 30 years. If the annuitant dies before the end of
the specified time, we pay the beneficiary the present value of the
annuity in one lump sum or continue making the
<PAGE>
15
payments to the beneficiary. You may terminate this option after
payments have started.
You must begin to take payments before the annuitiant's 90th birthday or earlier
in some states. If you do not tell us what payment option you want before that
time, we will pay you under the Payment of a Designated Period option for 5
years from the annuitiant's 90th birthday.
ABOUT US
HART LIFE INSURANCE COMPANY
Hart Life Insurance Company ("Hart Life") is a stock life insurance
company engaged in the business of writing life insurance in all states of
the United States and the District of Columbia. Hart Life was originally
incorporated under the laws New Jersey on July 9, 1965 and was redomesticated
to Connecticut on November 23, 1998. Its offices are located in Simsbury,
Connecticut; however, its mailing address is P.O. Box 2999, Hartford, CT
06104-2999. On December 22, 1999, Hart Life changed its name from Alpine
Life Insurance Company to Hart Life Insurance Company. Hart Life is
ultimately controlled by Hartford Financial Services Group, Inc., one of the
largest financial service providers in the United States.
SEPARATE ACCOUNT
The Separate Account was established on September 1, 1998. It is the
Separate Account in which Hart Life sets aside and invests the assets
attributable to variable annuity Contracts, including the Contracts sold
under this Prospectus. Separate Account assets are held by Hart Life under a
safekeeping arrangement. Although the Separate Account is an integral part of
Hart Life, it is registered as a unit investment trust under the Investment
Company Act of 1940. This registration does not, however, involve Commission
supervision of the management or the investment practices or policies of the
Separate Account or Hart Life. The Separate Account meets the definition of
"separate account" under federal securities law.
Under Connecticut law, the assets of the Separate Account attributable
to the Contracts offered under this Prospectus are held for the benefit of
the owners of, and the persons entitled to payments under, those Contracts.
Income, gains, and losses, whether or not realized, from assets allocated to
the Separate Account, are, in accordance with the Contracts, credited to or
charged against the Separate Account. Also, the assets in the Separate
Account are not chargeable with liabilities arising out of any other business
Hart Life may conduct. Contract Values allocated to the Separate Account is
not affected by the rate of return of Hart Life's General Account, nor by the
investment performance of any of Hart Life's other separate accounts. The
Separate Account may be subject to liabilities arising from a Sub-Account of
the Separate Account whose assets are attributable to other variable annuity
Contracts or variable life insurance policies offered by the Separate Account
which are not described in this Prospectus. However, all obligations arising
under the Contracts are general corporate obligations of Hart Life.
Hart Life does not guarantee the investment results of the Separate
Accounts or any of the
<PAGE>
16
underlying investment options. There is no assurance that the value of a
Contract during the years prior to retirement or the aggregate amount of the
Variable Annuity payments will equal the total of Premium Payments made under
the Contract. Since each underlying Fund has different investment objectives,
each is subject to different risks. These risks are more fully described in
the accompanying Funds' prospectus.
THE FUNDS
HL Investment Advisors, LLC ("HL Advisors") serves as the investment
adviser to each of the Funds. The Hartford Investment Management Company
("HIMCO") serves as sub-investment advisors and provides day to day
investment services.
Each Fund, except the Hartford High Yield HLS Fund, is a separate Maryland
corporation registered with the Securities and Exchange Commission as an
open-end management investment company. The Hartford High Yield HLS Fund is a
diversified series of Hartford Series Fund, Inc., a Maryland corporation,
also registered with the Securities and Exchange Commission as an open-end
management investment company. The shares of each Fund have been divided into
Class IA and Class IB. Only Class IA shares are available in this annuity.
We do not guarantee the investment results of any of the underlying Funds.
Since each underlying Fund has different investment objectives, each is
subject to different risks. These risks and the Funds' expenses are more
fully described in the accompanying Funds' prospectus and Statement of
Additional Information, which may be ordered from us. The Funds' prospectus
should be read in conjunction with this Prospectus before investing.
The Funds may not be available in all states.
The investment goals of each of the Funds are as follows:
Hartford Bond HLS Fund
Seeks maximum current income consistent with preservation of capital by
investing primarily in investment grade fixed-income securities. Up to 20% of
the total assets of this Fund may be invested in debt securities rated in the
highest category below investment grade ("Ba" by Moody's Investor Services,
Inc. or "BB" by Standard & Poor's) or, if unrated, are determined to be of
comparable quality by the Fund's investment adviser. Securities rated below
investment grade are commonly referred to as "high yield-high risk
securities" or "junk bonds." For more information concerning the risks
associated with investing in such securities, please refer to the section in
the accompanying prospectus for the Funds entitled "Hartford Bond HLS Fund,
Inc. - Investment Policies." Sub-advised by HIMCO.
Hartford High Yield HLS Fund
Seeks high current income by investing in non-investment grade
fixed-income securities. Growth of capital is a secondary objective.
Securities rated below investment grade are commonly referred to as "high
yield-high risk securities" or "junk bonds." For more information concerning
the risks associated with investing in such securities, please refer to the
section in the accompanying prospectus for the Funds entitled "Hartford High
Yield HLS Fund." Sub-advised by HIMCO.
<PAGE>
17
Hartford Index HLS Fund
Seeks to provide investment results that approximate the price and
yield performance of publicly-traded common stocks in the aggregate, as
represented by the Standard & Poor's 500 Composite Stock Price Index.*
Sub-advised by HIMCO.
Hartford Money Market HLS Fund
Seeks maximum current income consistent with liquidity and preservation
of capital. Sub-advised by HIMCO.
Hartford Mortgage Securities HLS Fund
Seeks maximum current income consistent with safety of principal and
maintenance of liquidity by investing primarily in mortgage-related
securities. Sub-advised by HIMCO.
* "Standard & Poor's-Registered Trademark-," "S&P-Registered Trademark-,"
"S&P 500-Registered Trademark-," "Standard & Poor's 500," and "500" are
trademarks of The McGraw-Hill Companies, Inc. and have been licensed for
use by Hartford. The Index Fund is not sponsored, endorsed, sold or
promoted by Standard & Poor's and Standard & Poor's makes no
representation regarding the advisability of investing in the Index Fund.
Voting Rights - We are the legal owners of all Fund shares held in the Separate
Account and we have the right to vote at the Fund's shareholder meetings. To
the extent required by federal securities laws or regulations, we will:
- - Notify you of any Fund shareholders' meeting if the shares held for your
Contract may be voted.
- - Send proxy materials and a form of instructions that you can use to tell
us how to vote the Fund shares held for your Contract.
- - Arrange for the handling and tallying of proxies received from Contract
Owners.
- - Vote all Fund shares attributable to your Contract according to instructions
received from you, and
- - Vote all Fund shares for which no voting instructions are received in the
same proportion as shares for which instructions have been received.
If any federal securities laws or regulations, or their present interpretation,
change to permit us to vote Fund shares on our own, we may decide to do so. You
may attend any Shareholder Meeting at which shares held for your Contract may be
voted. After we begin to make payments to you, the number of votes you have
will decrease.
Substitutions, Additions, or Deletions of Investments - We reserve the right,
subject to any applicable law, to make certain changes to the investment options
offered under your Contract. We may, in our sole discretion, establish new
Funds. New Funds will be made available
<PAGE>
18
to existing Contract Owners as we determine appropriate. We may also close
one or more Funds to additional Payments or transfers from existing
Sub-Accounts.
We reserve the right to eliminate the shares of any of the Funds for any reason
and to substitute shares of another registered investment company for the shares
of any Fund already purchased or to be purchased in the future by the Separate
Account. To the extent required by the 1940 Act, substitutions of shares
attributable to your interest in a Fund will not be made until we have the
approval of the Commission and we have notified you of the change.
In the event of any substitution or change, We may, by appropriate endorsement,
make such changes in the Contract as may be necessary or appropriate to reflect
such substitution or change. If we decide that it is in the best interest of
Contracts Owners, the Separate Account may be operated as a management company
under the 1940 Act or any other form permitted by law, may be de-registered
under the 1940 Act in the event such registration is no longer required, or may
be combined with one or more other separate accounts.
Administrative Services - Hartford has entered into agreements with the
investment advisers or distributors of many of the Funds. Under the terms of
these agreements, Hartford provides administrative services and the Funds pay
a fee to Hartford that is usually based on an annual percentage of the
average daily net assets of the Funds. These agreements may be different for
each Fund or each Fund family.
THE FIXED ACCOUNT
THAT PORTION OF THE CONTRACT RELATING TO THE FIXED ACCOUNT IS NOT
REGISTERED UNDER THE SECURITIES ACT OF 1933 ("1933 ACT") AND THE FIXED ACCOUNT
IS NOT REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF
1940 ("1940 ACT"). ACCORDINGLY, NEITHER THE FIXED ACCOUNT NOR ANY INTERESTS
THEREIN ARE SUBJECT TO THE PROVISIONS OR RESTRICTIONS OF THE 1933 ACT OR THE
1940 ACT, AND THE DISCLOSURE REGARDING THE FIXED ACCOUNT HAS NOT BEEN REVIEWED
BY THE STAFF OF THE SECURITIES AND EXCHANGE COMMISSION. THE FOLLOWING DISCLOSURE
ABOUT THE FIXED ACCOUNT MAY BE SUBJECT TO CERTAIN GENERALLY APPLICABLE
PROVISIONS OF THE FEDERAL SECURITIES LAWS REGARDING THE ACCURACY AND
COMPLETENESS OF DISCLOSURE.
Premium Payments and Contract Values allocated to the Fixed Account
become a part of the general assets of Hart Life. Hart Life invests the
assets of the General Account in accordance with applicable law governing the
investments of Insurance Company General Accounts.
Currently, Hart Life guarantees that it will credit interest at a rate
of not less than 3% per year, compounded annually, to amounts allocated to
the Fixed Account under the Contracts. However, Hart Life reserves the right
to change the rate according to state insurance law. Hart Life may credit
interest at a rate in excess of 3% per year. There is no specific formula for
the determination of excess interest credits. Some of the factors that Hart
Life may consider in determining whether to credit excess interest to amounts
allocated to the Fixed Account and the amount thereof, are general economic
trends, rates of return currently available and anticipated on Hart Life's
investments, regulatory and tax requirements and competitive factors. ANY
INTEREST CREDITED TO AMOUNTS ALLOCATED TO THE FIXED ACCOUNT IN EXCESS OF 3%
PER YEAR WILL BE DETERMINED IN THE SOLE DISCRETION OF HART LIFE. THE OWNER
ASSUMES THE
<PAGE>
19
RISK THAT INTEREST CREDITED TO FIXED ACCOUNT ALLOCATIONS MAY NOT EXCEED THE
MINIMUM GUARANTEE OF 3% FOR ANY GIVEN YEAR.
From time to time, Hart Life may credit increased interest rates to you under
certain programs established at the discretion of Hart Life.
PERFORMANCE RELATED INFORMATION
The Separate Account may advertise certain performance related information
concerning its Sub-Accounts. Performance information about a Sub-Account is
based on the Sub-Account's past performance only and is no indication of future
performance.
All of the Sub-Accounts may include total return in advertisements or other
sales material.
When a Sub-Account advertises its standardized total return, it will be
calculated to a date not earlier than the effective date of the Separate
Account. This figure will usually be calculated for one year, five years, and
ten years or some other relevant period if the Separate Account has not been in
existence for one, five or ten years. Total return is measured by comparing the
value of an investment in the Sub-Account at the beginning of the relevant
period to the value of the investment at the end of the period.
In addition to the standardized total return, the Sub-Account may advertise
non-standardized total returns that pre-date the inception of the Separate
Account. This figure will usually be calculated for one year, five years,
and ten years or other relevant period if the Separate Account has not been
in existence for one, five or ten years. This non-standardized total return
is measured in the same manner as the standardized total return described
above, except that the Annual Maintenance Fee is not deducted. Therefore,
this non-standardized total return for a Sub-Account is higher than
standardized total return for a Sub-Account. These non-standardized returns
must be accompanied by standardized total returns.
Certain Sub-Accounts, if applicable, may advertise yield in addition to total
return. The yield will be computed in the following manner: The net investment
income per unit earned during a recent one month period is divided by the unit
value on the last day of the period. This figure reflects the recurring charges
at the Separate Account level including the Annual Maintenance Fee.
The Money Market Fund Sub-Account may advertise yield and effective yield. The
yield of the Money Market Fund Sub-Account is based upon the income earned by
the Sub-Account over a 7-day period and then annualized, i.e. the income earned
in the period is assumed to be earned every 7 days over a 52-week period and
stated as a percentage of the investment. Effective yield
<PAGE>
20
is calculated similarly but when annualized, the income earned by the
investment is assumed to be reinvested in Sub-Account units and thus
compounded in the course of a 52-week period. Yield and effective yield
reflect the recurring charges at the Separate Account level including the
Annual Maintenance Fee.
Hart Life may provide information on various topics to Contract Owners and
prospective Contract Owners in advertising, sales literature or other
materials. These topics may include the relationship between sectors of the
economy and the economy as a whole and its effect on various securities
markets, investment strategies and techniques (such as value investing,
dollar cost averaging and asset allocation), the advantages and disadvantages
of investing in tax-advantaged and taxable instruments, customer profiles and
hypothetical purchase scenarios, financial management and tax and retirement
planning, and other investment alternatives, including comparisons between
the Contracts and the characteristics of and market for such alternatives.
YOUR ANNUITY
The Contracts are individual tax-deferred Variable Annuity Contracts
designed for retirement planning purposes and may be purchased by any
individual, including any trustee or custodian for a retirement plan qualified
under Sections 401(a) or 403(a) of the Code; annuity purchase plans adopted by
public school systems and certain tax-exempt organizations according to Section
403(b) of the Code; Individual Retirement Annuities adopted according to Section
408 of the Code; employee pension plans established for employees by a state, a
political subdivision of a state, or an agency or instrumentality of either a
state or a political subdivision of a state, and certain eligible deferred
compensation plans as defined in Section 457 of the Code ("Qualified
Contracts"). The maximum issue age for the Contract is 85 years old.
If you are purchasing the Contract for use in an IRA or other qualified
retirement plan, you should consider other features of the Contract besides
tax deferral, since any investment vehicle used within an IRA or other
qualified plan receives tax deferred treatment under the Code.
PAYMENTS
Generally, the minimum initial Premium Payment is $1,000; the minimum
subsequent payment is $500, if you are in the InvestEase program the minimum
subsequent payment is $50. Certain plans may make smaller periodic payments.
Each Premium Payment may be split among the various Sub-Accounts and/or the
Fixed Account subject to minimum amounts then in effect.
Refund Rights - If you are not satisfied with your purchase, you may cancel
the Contract by returning it within ten days (or longer in some states) after
you receive it. A written request for
<PAGE>
21
cancellation must accompany the Contract. In such event, Hart Life will,
without deduction for any charges normally assessed thereunder, pay you an
amount equal to the Contract Value on the date of receipt of the request for
cancellation. You bear the investment risk during the period prior to Hart
Life's receipt of request for cancellation. Hart Life will refund the
premium paid only for individual retirement annuities (if returned within
seven days of receipt) and in those states where required by law.
Crediting and Valuation - The balance of the initial Premium Payment
remaining after the deduction of any applicable Premium Tax is credited to
your Contract within two business days of receipt of a properly completed
application or an order to purchase a Contract and the initial Premium
Payment by Hart Life at its Administrative Office. It will be credited to the
Sub-Account(s) and/or the Fixed Account in accordance with your election. If
the application or other information is incomplete when received, the balance
of the initial Premium Payment, after deduction of any applicable Premium
Tax, will be credited to the Sub-Account(s) or the Fixed Account within five
business days of receipt. If the initial Premium Payment is not credited
within five business days, the Premium Payment will be immediately returned
unless you have been informed of the delay and request that the Premium
Payment not be returned.
The number of Accumulation Units in each Sub-Account to be credited to a
Contract will be determined by dividing the portion of the Premium Payment
being credited to each Sub-Account by the value of an Accumulation Unit in
that Sub-Account on that date.
Subsequent Premium Payments are priced on the Valuation Day received by
Hart Life in its Administrative Office.
CONTRACT VALUE
The value of the Sub-Account investments under your Contract at any time
prior to the commencement of annuity payments can be determined by multiplying
the total number of Accumulation Units credited to your Contract in each
Sub-Account by the then current Accumulation Unit values for the applicable
Sub-Account. The value of the Fixed Account under your Contract will be the
amount allocated to the Fixed Account plus interest credited.
You will be advised at least semiannually of the number of Accumulation
Units credited to each Sub-Account, the current Accumulation Unit values, the
Fixed Account value, and the total value of your Contract.
Accumulation Unit Values - The Accumulation Unit value for each Sub-Account
will vary to reflect the investment experience of the applicable Fund and will
be determined on each Valuation Day by multiplying the Accumulation Unit value
of the particular Sub-Account on the preceding Valuation Day by a "Net
Investment Factor" for that Sub-Account for the Valuation Period then ended. The
"Net Investment Factor" for each of the Sub-Accounts is equal to (a) the net
asset value per share of the corresponding Fund at the end of the Valuation
Period (plus the per share amount of any dividends or capital gains distributed
by that Fund if the ex-dividend date occurs in the Valuation Period then ended)
divided by the net asset value per share of the
<PAGE>
22
corresponding Fund at the beginning of the Valuation Period, (b) minus the
mortality and expense risk charge and the administration charge described
below. You should refer to the prospectus for each of the Funds which
accompanies this Prospectus for a description of how the assets of each Fund
are valued since each determination has a direct bearing on the Accumulation
Unit value of the Sub-Account and therefore the value of a Contract. The
Accumulation Unit Value is affected by the performance of the underlying
Fund(s), expenses and deduction of the charges described in this Prospectus.
Valuation of Fund Shares - The shares of the Fund are valued at net asset
value on each Valuation Day. A complete description of the valuation method used
in valuing Fund shares may be found in the accompanying Funds' prospectus.
Valuation of the Fixed Account - Hart Life will determine the value of the
Fixed Account by crediting interest to amounts allocated to the Fixed Account.
TRANSFERS
You may transfer the values of your Sub-Account allocations from one or
more Sub-Accounts to another free of charge. However, Hart Life reserves the
right to limit the number of transfers to twelve (12) per Contract Year, with
no two (2) transfers occurring on consecutive Valuation Days. Transfers by
telephone may be made by You or by the attorney-in-fact pursuant to a power
of attorney. Telephone transfers may not be permitted by some states.
The policy of Hart Life and its agents and affiliates is that they will
not be responsible for losses resulting from acting upon telephone requests
reasonably believed to be genuine. Hart Life will employ reasonable
procedures to confirm that instructions communicated by telephone are
genuine. The procedures Hart Life follows for transactions initiated by
telephone include requirements that callers provide certain information for
identification purposes. All transfer instructions by telephone are tape
recorded.
Hart Life may permit the Contract Owner to pre-authorize transfers among
Sub-Accounts and between Sub-Accounts and the Fixed Account under certain
circumstances. Transfers between the Sub-Accounts may be made both before and
after Annuity payments commence (limited to once a quarter) provided that the
minimum allocation to any Sub-Account may not be less than $500. No minimum
balance is required in any Sub-Account.
It is the responsibility of the Contract Owner to verify the accuracy of
all confirmations of transfers and to promptly advise Hart Life of any
inaccuracies within 30 days of receipt of the confirmation. Hart Life will
send the Contract Owner a confirmation of the transfer within five days from
the date of any instruction.
Transfers from the Fixed Account into a Sub-Account may be made at any time
during the Contract Year. The maximum amount which may be transferred from the
Fixed Account during any Contract Year is the greater of 30% of the Fixed
Account balance as of the last Contract Anniversary or the greatest amount of
any prior transfer from the Fixed Account. If Hart Life permits
<PAGE>
23
pre-authorized transfers from the Fixed Account to the Sub-Accounts, this
restriction is inapplicable. Also, if any interest rate is renewed at a rate
of at least one percentage point less than the previous rate, the Contract
Owner may elect to transfer up to 100% of the funds receiving the reduced
rate within 60 days of notification of the interest rate decrease. Generally,
transfers may not be made from any Sub-Account into the Fixed Account for the
six-month period following any transfer from the Fixed Account into one or
more of the Sub-Accounts. Hart Life reserves the right to modify the
limitations on transfers from the Fixed Account and to defer transfers from
the Fixed Account for up to six months from the date of request.
Subject to the exceptions set forth in the following two paragraphs, the
right to reallocate Contract Values is subject to modification if Hart Life
determines, in its sole opinion, that the exercise of that right by one or
more Contract Owners is, or would be, to the disadvantage of other Contract
Owners. Any modification could be applied to transfers to or from some or all
of the Sub-Accounts and the Fixed Account and could include, but not be
limited to, the requirement of a minimum time period between each transfer,
not accepting transfer requests of an agent acting under a power of attorney
on behalf of more than one Contract Owner, or limiting the dollar amount that
may be transferred between the Sub-Accounts and the Fixed Account by Contract
Owners at any one time. Such restrictions may be applied in any manner
reasonably designed to prevent any use of the transfer right which is
considered by Hart Life to be to the disadvantage of other Contract Owners.
For Contracts issued in the State of New York, the reservation of rights
set forth in the preceding paragraph is limited to (i) requiring up to a maximum
of 10 Valuation Days between each transfer: (ii) limiting the amount to be
transferred on any one Valuation Day to no more than $2 million; and (iii) upon
30 days prior written notice, to only accepting transfer instructions from You
and not from Your representative, agent or person acting under a power of
attorney for You.
Currently, and with respect to Contracts issued in all states, the only
restriction in effect is that Hart Life will not accept instructions from
agents acting under a power of attorney of multiple Contract Owners whose
accounts aggregate more than $2 million, unless the agent has entered into a
third party transfer services agreement with Hart Life.
CHARGES
Contingent Deferred Sales Charges ("Sales Charges")
Purpose of Sales Charges - Sales Charges cover expenses relating to the
sale and distribution of the Contracts, including commissions paid to
distributing organizations and its sales personnel, the cost of preparing
sales literature and other promotional activities. If these charges are not
sufficient to cover sales and distribution expenses, Hart Life will pay them
from its general assets, including surplus. Surplus might include profits
resulting from unused mortality and expense risk charges.
Assessment of Sales Charges - There is no deduction for sales expenses from
Premium Payments when made, however, a Sales Charge may be assessed against
Premium Payments when surrendered. The length of time from receipt of a Premium
Payment to the time of surrender
<PAGE>
24
determines the percentage of the Sales Charge. Premium payments are deemed to
be surrendered in the order in which they were received.
During the first seven years from each Premium Payment, a Sales Charge will
be assessed against the surrender of Premium Payments. During this time, all
surrenders in excess of the Annual Withdrawal Amount will be first from Premium
Payments and then from earnings. The Annual Withdrawal Amount is first from
earnings and then from Premium Payments. After the seventh Contract Year, all
surrenders will first be taken from earnings and then from Premium Payments and
a Sales Charge will not be assessed against the surrender of earnings. If an
amount equal to all earnings has been surrendered, a Sales Charge will not be
assessed against Premium Payments received more than seven years prior to
surrender, but will be assessed against Premium Payments received less than
seven years prior to surrender. For additional information, see Federal Tax
Considerations.
Upon receipt of a request for a full surrender, Hart Life will assess
any applicable Sales Charge against the surrender proceeds representing the
lesser of: (1) aggregate Premium Payments not previously withdrawn or (2)
the Contract Value, less the Annual Withdrawal Amount available at the time
of the full surrender, less the Annual Maintenance Fee, if applicable. Taking
the Annual Withdrawal Amount prior to the full surrender may, depending upon
the amount of investment gain experienced, reduce the amount of any Sales
Charge paid.
The Sales Charge is a percentage of the amount surrendered (not to exceed
the aggregate amount of the Premium Payments made) and equals:
<TABLE>
<CAPTION>
Charge Length of time from
Premium Payment
(Number of Years)
<S> <C>
6% 1
6% 2
5% 3
5% 4
4% 5
3% 6
2% 7
0% 8 or more
</TABLE>
Payments Not Subject to Sales Charges
Annual Withdrawal Amount - During the first seven years from each Premium
Payment, on a non-cumulative basis, You may make a partial surrender of Contract
Values of up to 10% of the aggregate Premium Payments, as determined on the date
of the requested surrender, without the application of the Sales Charge. After
the seventh year from each Premium Payment, also on a non-cumulative basis, You
may make a partial surrender of 10% of Premium Payments made during the seven
years prior to the surrender and 100% of the Contract Value less the Premium
Payments made during the seven years prior to the surrender.
<PAGE>
25
Extended Withdrawal Privilege - This privilege allows Annuitants who attain
age 70 1/2 with a Contract held under an Individual Retirement Account or 403(b)
plan to surrender an amount equal to the required minimum distribution for the
stated Contract without incurring a Sales Charge or not subject to a Sales
Charge.
Waivers of Sales Charges
Death of the Annuitant or Contract Owner or Payments Under an Annuity
Option - No Sales Charge otherwise applicable will be assessed in the event of
death of the Annuitant, death of the Contract Owner or if payments are made
under an Annuity option (other than a surrender out of Annuity Option 4)
provided for under the Contract.
Other Plans or Programs - Certain plans or programs established by
Hart Life from time to time may have different surrender privileges.
Mortality and Expense Risk Charge
For assuming these risks under the Contracts, Hart Life will make a
daily charge at the rate of 1.25% per annum against all Contract Values held
in the Sub-Accounts during the life of the Contract (estimated at .90% for
mortality and .35% for expense). Although Variable Annuity payments made
under the Contracts will vary in accordance with the investment performance
of the underlying Fund shares held in the Sub-Account(s), the payments will
not be affected by (a) Hart Life's actual mortality experience among
Annuitants before or after the Annuity Commencement Date or (b) Hart Life's
actual expenses, if greater than the deductions provided for in the Contracts
because of the expense and mortality undertakings by Hart Life.
There are two types of mortality undertakings: those made during the
accumulation or deferral phase and those made during the annuity payout
phase. The mortality undertaking made by Hart Life in the accumulation phase
is that Hart Life may experience a loss resulting from the assumption of the
mortality risk relative to the guaranteed death benefit in event of the death
of an Annuitant or Contract Owner before commencement of Annuity payments, in
periods of declining value or in periods where the contingent deferred sales
charges would have been applicable. The mortality undertakings provided by
Hart Life during the annuity payout phase are to make monthly Annuity
payments (determined in accordance with the 1983a Individual Annuity
Mortality Table and other provisions contained in the Contract) to Annuitants
regardless of how long an Annuitant may live, and regardless of how long all
Annuitants as a group may live. Hart Life also assumes the liability for
payment of a minimum death benefit under the Contract. These mortality
undertakings are based on Hart Life's determination of expected mortality
rates among all Annuitants. If actual experience among Annuitants during the
annuity payment period deviates from Hart Life's actuarial determination of
expected mortality rates among Annuitants because, as a group, their
longevity is longer than anticipated, Hart Life must provide amounts from its
general funds to fulfill its contractual obligations. Hart Life will bear the
loss in such a situation.
During the accumulation phase, Hart Life also provides an expense
undertaking. Hart Life
<PAGE>
26
assumes the risk that the contingent deferred sales charges and the Annual
Maintenance Fee for maintaining the Contracts prior to the Annuity Commencement
Date may be insufficient to cover the actual cost of providing such items.
Annual Maintenance Fee
Each year, on each Contract Anniversary on or before the Annuity
Commencement Date, Hart Life will deduct an Annual Maintenance Fee, if
applicable, from Contract Values to reimburse it for expenses relating to the
maintenance of the Contract, the Fixed Account, and the Sub-Account(s)
thereunder. If during a Contract Year the Contract is surrendered for its
full value, Hart Life will deduct the Annual Maintenance Fee at the time of
such surrender. The fee is a flat fee that will be due in the full amount
regardless of the time of the Contract Year that Contract Values are
surrendered. The Annual Maintenance Fee is $30.00 per Contract Year for
Contracts with less than $50,000 Contract Value on the Contract Anniversary.
Fees will be deducted on a pro rata basis according to the value in each
Sub-Account and the Fixed Account under a Contract.
Premium Taxes
Charges are also deducted for premium tax, if applicable, imposed by
state or other governmental entity. Certain states impose a premium tax,
currently ranging up to 3.5%. Some states assess the tax at the time purchase
payments are made; others assess the tax at the time of annuitization.
Hart Life will pay Premium Taxes at the time imposed under applicable law.
At its sole discretion, Hart Life may deduct Premium Taxes at the time
Hart Life pays such taxes to the applicable taxing authorities, at the time
the Contract is surrendered, at the time a death benefit is paid, or at the
time the Contract annuitizes.
Fund Charges
The Separate Account purchases shares of the Funds at net asset value.
The net asset value of the Fund shares reflects investment advisory fees and
administrative expenses already deducted from the assets of the Funds. These
changes are described in the Funds' prospectuses accompanying this Prospectus.
Exceptions to Charges Under the Contract
Hart Life may offer, at its discretion, reduced fees and charges
including, but not limited to, the contingent deferred sales charges, the
mortality and expense risk charge and the maintenance fee for certain sales
(including employer sponsored savings plans) under circumstances which may
result in savings of certain costs and expenses. Reductions in these fees and
charges will not be unfairly discriminatory against any Contract Owner.
DEATH BENEFITS
The Contract provides that, in the event the Annuitant dies before the
selected Annuity Commencement Date, the Contingent Annuitant will become the
Annuitant. If (1) the Annuitant dies before the Annuity Commencement Date and
either (a) there is no designated Contingent Annuitant or (b) the Contingent
Annuitant predeceases the Annuitant, or (2) if any Contract Owner dies before
the Annuity Commencement Date, the Beneficiary as determined under the
Contract Control Provisions, will receive the Death Benefit as determined on
the date of receipt of Due Proof of Death by Hart Life in its Administrative
Office. With regard to Joint Contract Owners, at the first death of a joint
Contract Owner prior to the Annuity Commencement Date, the Beneficiary will
be
<PAGE>
27
the surviving Contract Owner notwithstanding that the beneficiary designation
may be different.
Guaranteed Death Benefit - If the Annuitant dies before the Annuity
Commencement Date and there is no designated Contingent Annuitant surviving,
or if the Contract Owner dies before the Annuity Commencement Date, the
Beneficiary will receive the greatest of (a) the Contract Value determined as
of the day written proof of death of such person is received by Hart Life, or
(b) 100% of the total Premium Payments made to such Contract, reduced by the
dollar amount of any partial surrenders since the issue date, or (c) the
Maximum Anniversary Value immediately preceding the date of death. The
Maximum Anniversary Value is equal to the greatest Anniversary Value attained
from the following:
As of the date of receipt of Due Proof of Death, Hart Life will
calculate an Anniversary Value for each Contract Anniversary prior to the
deceased's attained age 81. The Anniversary Value is equal to the Contract
Value on a Contract Anniversary, increased by the dollar amount of any
premium payments made since that anniversary and reduced by the dollar amount
of any partial surrenders since that anniversary.
If the Annuitant or You, as applicable, die after the Annuity
Commencement Date, then the Death Benefit will equal the present value of any
remaining payments under the elected Annuity Option. In computing such
present value for the portion of such remaining payments attributable to the
Separate Account, Hart Life will assume a net investment rate of 5.0% per
year.
Payment of Death Benefit - The calculated Death Benefit will remain
invested in the Separate Account in accordance with the allocation
instructions given by the Contract Owner until the proceeds are paid or
Hart Life receives new instructions from the Beneficiary. During the time
period between Hart Life's receipt of written notification of Due Proof of
Death and Hart Life's receipt of the completed settlement instructions, the
calculated Death Benefit will remain invested in the Sub-Account(s)
previously elected by the Contract Owner and will be subject to market
fluctuations. The Death Benefit may be taken in one sum, payable within seven
days after the date Due Proof of Death is received, or under any of the
settlement options then being offered by Hart Life provided, however, that:
(a) in the event of the death of any Contract Owner prior to the Annuity
Commencement Date, the entire interest in the Contract will be distributed
within five years after the death of the Contract Owner and (b) in the event
of the death of any Contract Owner or Annuitant which occurs on or after the
Annuity Commencement Date, any remaining interest in the Contract will be
paid at least as rapidly as under the method of distribution in effect at the
time of death, or, if the benefit is payable over a period not extending
beyond the life expectancy of the Beneficiary or over the life of the
Beneficiary, such distribution must commence within one year of the date of
death. The proceeds due on the death may be applied to provide variable
payments, fixed payments, or a combination of variable and fixed payments.
However, in the event of the Contract Owner's death where the sole
Beneficiary is the spouse of the Contract Owner and the Annuitant or
Contingent Annuitant is living, such spouse may elect, in lieu of receiving
the death benefit, to be treated as the Contract Owner. The Contract Value
and the Maximum Anniversary Value of the Contract will be unaffected by
treating the spouse as the Contract Owner.
If the Contract is owned by a corporation or other non-individual, the
Death Benefit payable
<PAGE>
28
upon the death of the Annuitant prior to the Annuity Commencement Date will be
payable only as one sum or under the same settlement options and in the same
manner as if an individual Contract Owner died on the date of the Annuitant's
death.
There may be postponement in the payment of Death Benefits whenever (a)
the New York Stock Exchange is closed, except for holidays or weekends, or
trading on the New York Stock Exchange is restricted as determined by the
Commission; (b) the Commission permits postponement and so orders; or (c) the
Commission determines that an emergency exists making valuation of the
amounts or disposal of securities not reasonably practicable.
Annuity Proceeds Settlement Option
Proceeds from the Death Benefit may be left with Hart Life for a period
not to exceed five years from the date of the Contract Owner's death prior to
the Annuity Commencement Date. These proceeds will remain in the
Sub-Account(s) to which they were allocated at the time of death unless the
Beneficiary elects to reallocate them. Full or partial withdrawals may be
made at any time without a contingent deferred sales charge. In the event of
withdrawals, the remaining value will equal the Contract Value of the
proceeds left with Hart Life, minus any withdrawals.
WITHDRAWALS
Full Surrenders - At any time prior to the Annuity Commencement Date (and
after the Annuity Commencement Date with respect to values applied to Annuity
Option 4 or the Annuity Proceeds Settlement Option), the Contract Owner has the
right to terminate the Contract. In such event, the Termination Value of the
Contract may be taken in the form of a lump sum cash settlement.
Under any of the Annuity options excluding Annuity Option 4 and the
Annuity Proceeds Settlement Option, no surrenders are permitted after Annuity
payments commence. Partial surrenders are permitted out of Annuity Option 4
(subject to any contingent deferred sales charges), but check with your tax
advisor because there may be adverse tax consequences. Full or partial
withdrawals may be made from the Annuity Proceeds Settlement Option at any
time and contingent deferred sales charges will not be applied.
The Termination Value of the Contract is equal to the Contract Value less
any applicable Premium Taxes, the Annual Maintenance Fee if applicable and any
applicable contingent deferred sales charges. The Termination Value may be more
or less than the amount of the Premium Payments made to a Contract.
Partial Surrenders - You may make a partial surrender of Contract
Values at any time prior to the Annuity Commencement Date so long as the
amount surrendered is at least equal to the minimum amount rules then in
effect. Additionally, if the remaining Contract Value following a surrender
is less than $500 ($1,000 in New York), Hart Life will terminate the Contract
and pay the Termination Value. For Contracts issued in Texas, there is an
additional requirement that the Contract will not be terminated when the
remaining Contract Value after a surrender is less than $500 unless there
were no Premium Payments made during the previous two Contract Years.
In requesting a partial withdrawal you should specify the Sub-Account(s)
and/or the Fixed Account from which the partial withdrawal is to be taken.
Otherwise, such withdrawal and any applicable contingent deferred sales charges
will be effected on a pro rata basis according to the value in the Fixed Account
and each Sub-Account under a Contract.
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Hart Life may permit You to pre-authorize partial surrenders subject to
certain limitations then in effect.
Payment of Surrender Benefits - Payment on any request for a full or
partial surrender from the Sub-Accounts will be made as soon as possible and
in any event no later than seven days after the written request is received
by Hart Life at its Administrative Office. Hart Life may defer payment of any
amounts from the Fixed Account for up to six months from the date of the
request for surrender. If Hart Life defers payment for more than 30 days (10
working days in New York), Hart Life will pay interest of at least 3% per annum
on the amount deferred.
There may be postponement in the payment of Surrender Benefits whenever (a)
the New York Stock Exchange is closed, except for holidays or weekends, or
trading on the New York Stock Exchange is restricted as determined by the
Commission; (b) the Commission permits postponement and so orders; or (c) the
Commission determines that an emergency exists making valuation of the amounts
or disposal of securities not reasonably practicable.
CERTAIN QUALIFIED CONTRACT SURRENDERS - THERE ARE CERTAIN RESTRICTIONS ON
SECTION 403(b) TAX SHELTERED ANNUITIES. AS OF DECEMBER 31, 1988, ALL SECTION
403(b) ANNUITIES HAVE LIMITS ON FULL AND PARTIAL SURRENDERS. CONTRIBUTIONS TO
THE CONTRACT MADE AFTER DECEMBER 31, 1988 AND ANY INCREASES IN CASH VALUE AFTER
DECEMBER 31, 1988 MAY NOT BE DISTRIBUTED UNLESS THE CONTRACT OWNER/EMPLOYEE HAS
A) ATTAINED AGE 59 1/2, B) SEPARATED FROM SERVICE, C) DIED, D) BECOME DISABLED
OR E) EXPERIENCED FINANCIAL HARDSHIP. (CASH VALUE INCREASES MAY NOT BE
DISTRIBUTED PRIOR TO AGE 59 1/2 FOR HARDSHIPS.)
DISTRIBUTIONS PRIOR TO AGE 59 1/2 DUE TO FINANCIAL HARDSHIP OR SEPARATION
FROM SERVICE MAY STILL BE SUBJECT TO A PENALTY TAX OF 10%.
HART LIFE WILL NOT ASSUME ANY RESPONSIBILITY IN DETERMINING WHETHER A
WITHDRAWAL IS PERMISSIBLE, WITH OR WITHOUT TAX PENALTY, IN ANY PARTICULAR
SITUATION; OR IN MONITORING WITHDRAWAL REQUESTS REGARDING PRE OR POST JANUARY 1,
1989 ACCOUNT VALUES.
ANY SUCH FULL OR PARTIAL SURRENDER DESCRIBED ABOVE MAY AFFECT THE
CONTINUING TAX QUALIFIED STATUS OF SOME CONTRACTS OR PLANS AND MAY RESULT IN
ADVERSE TAX CONSEQUENCES TO THE CONTRACT OWNER. THE CONTRACT OWNER, THEREFORE,
SHOULD CONSULT WITH HIS TAX ADVISER BEFORE UNDERTAKING ANY SUCH SURRENDER. (SEE
"FEDERAL TAX CONSIDERATIONS.")
SETTLEMENT PROVISIONS
You select an Annuity Commencement Date and an Annuity option which may be
on a fixed or variable basis, or a combination thereof. The Annuity Commencement
Date will not be
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30
deferred beyond the Annuitant's 90th birthday. The Annuity Commencement Date
and/or the Annuity option may be changed from time to time, but any change must
be at least 30 days prior to the date on which annuity payments are scheduled
to begin. The Contract allows You to change the Sub-Accounts on which variable
payments are based after payments have commenced once every three months. Any
Fixed Annuity allocation may not be changed.
The Contract contains the four Annuity payment options. Annuity Options
2, 4, and the Annuity Proceeds Settlement Option are available to Qualified
Contracts only if the guaranteed payment period is less than the life
expectancy of the Annuitant at the time the option becomes effective. Such
life expectancy shall be computed on the basis of the mortality table
prescribed by the IRS, or if none is prescribed, the mortality table then in
use by Hart Life. With respect to Non-Qualified Contracts, if you do not elect
otherwise, payments in most states will automatically begin at the
Annuitant's age 90 (with the exception of states that do not allow deferral
past age 85) under Annuity Option 2 with 120 monthly payments certain. For
Qualified Contracts and Contracts issued in Texas, if you do not elect
otherwise, payments will begin automatically at the Annuitant's age 90 under
Annuity Option 1 to provide a life Annuity. After the Annuity Commencement
Date, the Annuity option elected may not be changed.
Under any of the Annuity options excluding Annuity Option 4, no
surrenders are permitted after Annuity payments commence. Partial surrenders
are permitted out of Annuity Option 4 (subject to any contingent deferred
sales charges), but check with your tax advisor because there may be adverse
tax consequences.
Option 1 - Life Annuity
A life Annuity is an Annuity payable during the lifetime of the Annuitant
and terminating with the last payment due preceding the death of the Annuitant.
This option offers the largest payment amount of any of the life Annuity options
since there is no guarantee of a minimum number of payments nor a provision for
a Death Benefit payable to a Beneficiary.
It would be possible under this option for an Annuitant to receive only one
Annuity payment if he died prior to the due date of the second Annuity payment,
two if he died before the date of the third Annuity payment, etc.
Option 2 - Life Annuity with 120, 180 or 240 Monthly Payments Certain
This Annuity option is an Annuity payable monthly during the lifetime of
an Annuitant with the provision that payments will be made for a minimum of
120, 180 or 240 months, as elected. If, at the death of the Annuitant,
payments have been made for less than the minimum elected number of months,
then the present value as of the date of the Annuitant's death, of any
remaining guaranteed payments will be paid in one sum to the Beneficiary or
Beneficiaries designated unless other provisions have been made and approved
by Hart Life.
Option 3 - Joint and Last Survivor Annuity
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An Annuity payable monthly during the joint lifetime of the Annuitant
and a designated second person, and thereafter during the remaining lifetime
of the survivor, ceasing with the last payment prior to the death of the
survivor. Based on the options currently offered by Hart Life, the Annuitant
may elect that the payment to the survivor be less than the payment made
during the joint lifetime of the Annuitant and a designated second person.
It would be possible under this option for an Annuitant and designated
second person to receive only one payment in the event of the common or
simultaneous death of the parties prior to the due date for the second payment
and so on.
Option 4 - Payments for a Designated Period
An amount payable monthly for the number of years selected which may be
from 5 to 30 years. Partial surrenders are permitted out of Annuity Option 4
(subject to any contingent deferred sales charges), but check with your tax
advisor because there may be adverse tax consequences.
In the event of the Annuitant's death prior to the end of the designated
period, the present value as of the date of the Annuitant's death, of any
remaining guaranteed payments will be paid in one sum to the Beneficiary or
Beneficiaries designated unless other provisions have been made and approved by
Hart Life.
Annuity Option 4 is an option that does not involve life contingencies and
thus no mortality guarantee. Charges made for the mortality undertaking under
the Contracts thus provide no real benefit to You.
Hart Life may offer other annuity or settlement options from time to time.
Variable and Fixed Annuity Payments - When an annuity is effected under
a Contract, unless otherwise specified, Contract Values (less applicable
Premium Taxes) held in the Sub-Accounts will be applied to provide a Variable
Annuity based on the pro rata amount in the various Sub-Accounts. Fixed
Account Contract Values will be applied to provide a Fixed Annuity. YOU
SHOULD CONSIDER THE QUESTION OF ALLOCATION OF CONTRACT VALUES (LESS
APPLICABLE PREMIUM TAXES) AMONG SUB-ACCOUNTS OF THE SEPARATE ACCOUNT AND THE
GENERAL ACCOUNT OF HART LIFE TO MAKE CERTAIN THAT ANNUITY PAYMENTS ARE BASED
ON THE INVESTMENT ALTERNATIVE BEST
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32
SUITED TO YOUR NEEDS FOR RETIREMENT.
The minimum monthly annuity payment is $50.00. No election may be made
which results in a first payment of less than $50.00. If at any time annuity
payments are or become less than $50.00, Hart Life has the right to change
the frequency of payment to intervals that will result in payments of at
least $50.00. For New York Contracts, the minimum monthly annuity payment is
$20.00.
When annuity payments are to commence, the value of the Contract is
determined as the sum of (1) the value of the Fixed Account no earlier than the
close of business on the fifth Valuation Day preceding the date the first
annuity payment is due plus (2) the product of (a) the value of the Accumulation
Unit of each Sub-Account on that same day and (b) the number of Accumulation
Units credited to each Sub-Account as of the date the annuity is to commence.
All annuity payments under any option will occur the same day of the month
as the Annuity Commencement Date, based on the payment frequency selected by
You. Available payment frequencies include monthly, quarterly, semi-annual and
annual. The payment frequency may not be changed after payout has begun.
Variable Annuity - The Contract contains tables indicating the minimum
dollar amount of the first monthly payment under the optional variable forms of
annuity for each $1,000 of value of a Sub-Account under a Contract. The first
monthly payment varies according to the form and type of Variable Payment
Annuity selected. The Contract contains Variable Payment Annuity tables derived
from the 1983a Individual Annuity Mortality Table with ages set back one year
and with an assumed investment rate ("A.I.R.") of 5% per annum. The total first
monthly Variable Annuity payment is determined by multiplying the value
(expressed in thousands of dollars) of a Sub-Account (less any applicable
Premium Taxes) by the amount of the first monthly payment per $1,000 of value
obtained from the tables in the Contracts.
The amount of the first monthly Variable Annuity payment is divided by the
value of an Annuity Unit for the appropriate Sub-Account no earlier than the
close of business on the fifth Valuation Day preceding the day on which the
payment is due in order to determine the number of Annuity Units represented by
the first payment. This number of Annuity Units remains fixed during the Annuity
payment period, and in each subsequent month the dollar amount of the Variable
Annuity payment is determined by multiplying this fixed number of Annuity Units
by the then current Annuity Unit value.
The value of the Annuity Unit for each Sub-Account in the Separate Account
for any day is determined by multiplying the value for the preceding day by the
product of (1) the net investment factor for the day for which the Annuity Unit
value is being calculated, and (2) a factor to neutralize the assumed investment
rate of 5% per annum. The Annuity Unit value used in calculating the amount of
the Variable Annuity payments will be based on an Annuity Unit value determined
as of the close of business on a day no earlier than the fifth Valuation Day
preceding the date of the Annuity payment.
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33
LEVEL VARIABLE ANNUITY PAYMENTS WOULD BE PRODUCED IF THE INVESTMENT RATE
REMAINED CONSTANT AND EQUAL TO THE A.I.R. IN FACT, PAYMENTS WILL VARY UP OR DOWN
AS THE INVESTMENT RATE VARIES UP OR DOWN FROM THE A.I.R.
Fixed Annuity - Fixed Annuity payments are determined at annuitization
by multiplying the Contract Value (less applicable Premium Taxes) by a rate
to be determined by Hart Life which is no less than the rate specified in the
Fixed Payment Annuity tables in the Contract. The annuity payment will remain
level for the duration of the annuity.
OTHER INFORMATION
Assignment - Ownership of a Contract described herein is generally
assignable. However, if the Contracts are issued pursuant to some form of
Qualified Plan, it is possible that the ownership of the Contracts may not be
transferred or assigned depending on the type of tax-qualified retirement plan
involved. An assignment of a Non-Qualified Contract may subject the Contract
values or assignment proceeds to income taxes and certain penalty taxes.
Contract Modification - The Annuitant may not be changed; however, the
Contingent Annuitant may be changed at any time prior to the Annuity
Commencement Date by written notice to Hart Life.
Hart Life reserves the right to modify the Contract, but only if such
modification: (i) is necessary to make the Contract or the Separate Account
comply with any law or regulation issued by a governmental agency to which
Hart Life is subject; or (ii) is necessary to assure continued qualification
of the Contract under the Code or other federal or state laws relating to
retirement annuities or annuity Contracts; or (iii) is necessary to reflect a
change in the operation of the Separate Account or the Sub-Account(s) or (iv)
provides additional Separate Account options or (v) withdraws Separate
Account options. In the event of any such modification Hart Life will provide
notice to You or to the payee(s) during the annuity period. Hart Life may
also make appropriate endorsement in the Contract to reflect such
modification.
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34
FEDERAL TAX CONSIDERATIONS
What are some of the federal tax consequences which affect these Contracts?
A. GENERAL
Since federal tax law is complex, the tax consequences of purchasing this
contract will vary depending on your situation. You may need tax or legal
advice to help you determine whether purchasing this contract is right for
you.
Our general discussion of the tax treatment of this contract is based on our
understanding of federal income tax laws as they are currently interpreted.
A detailed description of all federal income tax consequences regarding the
purchase of this contract cannot be made in the prospectus. We also do not
discuss state, municipal or other tax laws that may apply to this contract.
For detailed information, you should consult with a qualified tax adviser
familiar with your situation.
B. TAXATION OF HART LIFE AND THE SEPARATE ACCOUNT
The Separate Account is taxed as part of Hart Life which is taxed as a life
insurance company in accordance with the Internal Revenue Code of 1986, as
amended (the "Code"). Accordingly, the Separate Account will not be taxed as
a "regulated investment company" under subchapter M of Chapter 1 of the Code.
Investment income and any realized capital gains on the assets of the
Separate Account are reinvested and are taken into account in determining the
value of the Accumulation and Annuity Units (See "Value of Accumulation
Units"). As a result, such investment income and realized capital gains are
automatically applied to increase reserves under the Contract.
No taxes are due on interest, dividends and short-term or long-term capital
gains earned by the Separate Account with respect to Qualified or
Non-Qualified Contracts.
C. TAXATION OF ANNUITIES -- GENERAL PROVISIONS AFFECTING PURCHASERS OTHER
THAN QUALIFIED RETIREMENT PLANS
Section 72 of the Code governs the taxation of annuities in general.
1. NON-NATURAL PERSONS, CORPORATIONS, ETC. Code Section 72 contains
provisions for Contract Owners which are not natural persons.
Non-natural persons include corporations, trusts, limited liability
companies, partnerships and other types of legal entities. The tax
rules for contracts owned by non-natural persons are different from the
rules for contracts owned by individuals. For example, the annual net
increase in the value of the contract is currently includable in the
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35
gross income of a non-natural person, unless the non-natural person
holds the contract as an agent for a natural person. There are
additional exceptions from current inclusion for:
- certain annuities held by structured settlement companies,
- certain annuities held by an employer with respect to a terminated
qualified retirement plan and
- certain immediate annuities.
A non-natural person which is a tax-exempt entity for federal tax purposes
will not be subject to income tax as a result of this provision.
If the contract owner is a non-natural person, the primary annuitant is
treated as the contract owner in applying mandatory distribution rules.
These rules require that certain distributions be made upon the death of the
contract owner. A change in the primary annuitant is also treated as the
death of the contract owner.
2. OTHER CONTRACT OWNERS (NATURAL PERSONS). A Contract Owner is not taxed on
increases in the value of the Contract until an amount is received or
deemed received, e.g., in the form of a lump sum payment (full or partial
value of a Contract) or as Annuity payments under the settlement option
elected.
The provisions of Section 72 of the Code concerning distributions are
summarized briefly below. Also summarized are special rules affecting
distributions from Contracts obtained in a tax-free exchange for other
annuity contracts or life insurance contracts which were purchased prior
to August 14, 1982.
a. DISTRIBUTIONS PRIOR TO THE ANNUITY COMMENCEMENT DATE.
i. Total premium payments less amounts received which were not
includable in gross income equal the "investment in the contract"
under Section 72 of the Code.
ii. To the extent that the value of the Contract (ignoring any
surrender charges except on a full surrender) exceeds the
"investment in the contract," such excess constitutes the "income
on the contract."
iii. Any amount received or deemed received prior to the Annuity
Commencement Date (e.g., upon a partial surrender) is deemed to
come first from any such "income on the contract" and then from
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36
"investment in the contract," and for these purposes such
"income on the contract" shall be computed by reference to any
aggregation rule in subparagraph 2.c. below. As a result, any
such amount received or deemed received (1) shall be includable
in gross income to the extent that such amount does not exceed
any such "income on the contract," and (2) shall not be
includable in gross income to the extent that such amount does
exceed any such "income on the contract." If at the time that
any amount is received or deemed received there is no "income on
the contract" (e.g., because the gross value of the Contract
does not exceed the "investment in the contract" and no
aggregation rule applies), then such amount received or deemed
received will not be includable in gross income, and will simply
reduce the "investment in the contract."
iv. The receipt of any amount as a loan under the Contract or the
assignment or pledge of any portion of the value of the Contract
shall be treated as an amount received for purposes of this
subparagraph a. and the next subparagraph b.
v. In general, the transfer of the Contract, without full and
adequate consideration, will be treated as an amount received
for purposes of this subparagraph a. and the next subparagraph b.
This transfer rule does not apply, however, to certain transfers
of property between spouses or incident to divorce.
b. DISTRIBUTIONS AFTER ANNUITY COMMENCEMENT DATE. Annuity payments made
periodically after the Annuity Commencement Date are includable in
gross income to the extent the payments exceed the amount determined
by the application of the ratio of the "investment in the contract"
to the total amount of the payments to be made after the Annuity
Commencement Date (the "exclusion ratio").
i. When the total of amounts excluded from income by application of
the exclusion ratio is equal to the investment in the contract
as of the Annuity Commencement Date, any additional payments
(including surrenders) will be entirely includable in gross
income.
ii. If the annuity payments cease by reason of the death of the
Annuitant and, as of the date of death, the amount of annuity
payments excluded from gross income by the exclusion ratio does
not exceed the investment in the contract as of the Annuity
Commencement Date, then the remaining portion of unrecovered
investment shall be allowed as a deduction for the last taxable
year of the Annuitant.
iii. Generally, nonperiodic amounts received or deemed received after
the Annuity Commencement Date are not entitled to any exclusion
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37
ratio and shall be fully includable in gross income. However,
upon a full surrender after such date, only the excess of the
amount received (after any surrender charge) over the remaining
"investment in the contract" shall be includable in gross income
(except to the extent that the aggregation rule referred to in
the next subparagraph c. may apply).
c. AGGREGATION OF TWO OR MORE ANNUITY CONTRACTS. Contracts issued after
October 21, 1988 by the same insurer (or affiliated insurer) to the
same Contract Owner within the same calendar year (other than certain
contracts held in connection with a tax-qualified retirement
arrangement) will be treated as one annuity Contract for the purpose
of determining the taxation of distributions prior to the Annuity
Commencement Date. An annuity contract received in a tax-free
exchange for another annuity contract or life insurance contract may
be treated as a new Contract for this purpose. Hart Life believes
that for any annuity subject to such aggregation, the values under the
Contracts and the investment in the contracts will be added together
to determine the taxation under subparagraph 2.a., above, of amounts
received or deemed received prior to the Annuity Commencement Date.
Withdrawals will first be treated as withdrawals of income until all
of the income from all such Contracts is withdrawn. As of the date of
this Prospectus, there are no regulations interpreting this provision.
d. 10% PENALTY TAX -- APPLICABLE TO CERTAIN WITHDRAWALS AND ANNUITY
PAYMENTS.
i. If any amount is received or deemed received on the Contract
(before or after the Annuity Commencement Date), the Code applies
a penalty tax equal to ten percent of the portion of the amount
includable in gross income, unless an exception applies.
ii. The 10% penalty tax will not apply to the following distributions
(exceptions vary based upon the precise plan involved):
1. Distributions made on or after the date the recipient has
attained the age of 59 1/2.
2. Distributions made on or after the death of the holder or
where the holder is not an individual, the death of the
primary annuitant.
3. Distributions attributable to a recipient's becoming
disabled.
4. A distribution that is part of a scheduled series of
substantially equal periodic payments (not less frequently
than annually) for the life (or life expectancy) of the
recipient (or the joint lives or life expectancies of the
recipient and the recipient's designated Beneficiary).
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5. Distributions of amounts which are allocable to the
"investment in the contract" prior to August 14, 1982 (see
next subparagraph e.).
e. SPECIAL PROVISIONS AFFECTING CONTRACTS OBTAINED THROUGH A TAX-FREE
EXCHANGE OF OTHER ANNUITY OR LIFE INSURANCE CONTRACTS PURCHASED PRIOR
TO AUGUST 14, 1982. If the Contract was obtained by a tax-free
exchange of a life insurance or annuity Contract purchased prior to
August 14, 1982, then any amount received or deemed received prior to
the Annuity Commencement Date shall be deemed to come (1) first from
the amount of the "investment in the contract" prior to August 14,
1982 ("pre-8/14/82 investment") carried over from the prior Contract,
(2) then from the portion of the "income on the contract" (carried
over to, as well as accumulating in, the successor Contract) that is
attributable to such pre-8/14/82 investment, (3) then from the
remaining "income on the contract" and (4) last from the remaining
"investment in the contract." As a result, to the extent that such
amount received or deemed received does not exceed such pre-8/14/82
investment, such amount is not includable in gross income. In
addition, to the extent that such amount received or deemed received
does not exceed the sum of (a) such pre-8/14/82 investment and (b) the
"income on the contract" attributable thereto, such amount is not
subject to the 10% penalty tax. In all other respects, amounts
received or deemed received from such post-exchange Contracts are
generally subject to the rules described in this subparagraph 3.
f. REQUIRED DISTRIBUTIONS
i. Death of Contract Owner or Primary Annuitant
Subject to the alternative election or spouse beneficiary
provisions in ii or iii below:
1. If any Contract Owner dies on or after the Annuity
Commencement Date and before the entire interest in the
Contract has been distributed, the remaining portion of such
interest shall be distributed at least as rapidly as under
the method of distribution being used as of the date of such
death;
2. If any Contract Owner dies before the Annuity Commencement
Date, the entire interest in the Contract will be
distributed within 5 years after such death; and
3. If the Contract Owner is not an individual, then for
purposes of 1. or 2. above, the primary annuitant under the
Contract shall be treated as the Contract Owner, and any
change in the primary annuitant shall be treated as the
death of the Contract Owner. The primary annuitant is the
individual, the events in the life of whom are of primary
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39
importance in affecting the timing or amount of the payout
under the Contract.
ii. Alternative Election to Satisfy Distribution Requirements
If any portion of the interest of a Contract Owner described in
i. above is payable to or for the benefit of a designated
beneficiary, such beneficiary may elect to have the portion
distributed over a period that does not extend beyond the life or
life expectancy of the beneficiary. Distributions must begin
within a year of the Contract Owner's death.
iii. Spouse Beneficiary
If any portion of the interest of a Contract Owner is payable to
or for the benefit of his or her spouse, and the Annuitant or
Contingent Annuitant is living, such spouse shall be treated as
the Contract Owner of such portion for purposes of section i.
above. This spousal continuation shall apply only once for this
contract.
3. DIVERSIFICATION REQUIREMENTS. The Code requires that investments supporting
your Contract be adequately diversified. Code Section 817 provides that a
variable annuity contract will not be treated as an annuity contract for
any period during which the investments made by the separate account or
underlying fund are not adequately diversified. If a contract is not
treated as an annuity contract, the contract owner will be subject to
income tax on annual increases in cash value.
The Treasury Department's diversification regulations require, among other
things, that:
- no more than 55% of the value of the total assets of the segregated
asset account underlying a variable contract is represented by any one
investment,
- no more than 70% is represented by any two investments,
- no more than 80% is represented by any three investments and
- no more than 90% is represented by any four investments.
In determining whether the diversification standards are met, all
securities of the same issuer, all interests in the same real property
project, and all interests in the same commodity are each treated as a
single investment. In the case of government securities, each government
agency or instrumentality is treated as a separate issuer.
A separate account must be in compliance with the diversification standards
on the last day of each calendar quarter or within 30 days after the
quarter ends. If an insurance company inadvertently fails to meet the
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40
diversification requirements, the company may still comply within a
reasonable period and avoid the taxation of contract income on an ongoing
basis. However, either the company or the contract owner must agree to pay
the tax due for the period during which the diversification requirements
were not met.
We monitor the diversification of investments in the separate accounts and
test for diversification as required by the Code. We intend to administer
all contracts subject to the diversification requirements in a manner that
will maintain adequate diversification.
4. OWNERSHIP OF THE ASSETS IN THE SEPARATE ACCOUNT. In order for a variable
annuity contract to qualify for tax deferral, assets in the separate
accounts supporting the contract must be considered to be owned by the
insurance company and not by the contract owner. It is unclear under what
circumstances an investor is considered to have enough control over the
assets in the separate account to be considered the owner of the assets for
tax purposes.
The IRS has issued several rulings discussing investor control. These
rulings say that certain incidents of ownership by the contract owner, such
as the ability to select and control investments in a separate account,
will cause the contract owner to be treated as the owner of the assets for
tax purposes.
In its explanation of the diversification regulations, the Treasury
Department recognized that the temporary regulations "do not provide
guidance concerning the circumstances in which investor control of the
investments of a segregated asset account may cause the investor, rather
than the insurance company, to be treated as the owner of the assets in the
account." The explanation further indicates that "the temporary regulations
provide that in appropriate cases a segregated asset account may include
multiple sub-accounts, but do not specify the extent to which policyholders
may direct their investments to particular sub-accounts without being
treated as the owners of the underlying assets. Guidance on this and other
issues will be provided in regulations or revenue rulings under Section
817(d), relating to the definition of variable contract."
The final regulations issued under Section 817 did not provide guidance
regarding investor control, and as of the date of this prospectus, guidance
has yet to be issued. We do not know if additional guidance will be
issued. If guidance is issued, we do not know if it will have a
retroactive effect.
Due to the lack of specific guidance on investor control, there is some
uncertainty about when a contract owner is considered the owner of the
assets for tax purposes. We reserve the right to modify the contract, as
necessary, to prevent you from being considered the owner of assets in the
separate account.
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D. FEDERAL INCOME TAX WITHHOLDING
Any portion of a distribution that is (or deemed to be) current taxable
income to the Contract Owner will be subject to the federal income tax
withholding and reporting under the Code. Generally, however, a Contract
Owner may elect not to have income taxes withheld or to have income
taxes withheld at a different rate by filing a completed election form
with us. Election forms will be provided at the time distributions
are requested.
E. GENERAL PROVISIONS AFFECTING QUALIFIED RETIREMENT PLANS
The Contract may be used for a number of qualified retirement plans. If
the Contract is being purchased with respect to some form of qualified
retirement plan, please refer to Appendix I for information relative to the
types of plans for which it may be used and the general explanation of the
tax features of such plans.
F. ANNUITY PURCHASES BY NONRESIDENT ALIENS AND FOREIGN CORPORATIONS
The discussion above provides general information regarding U.S. federal
income tax consequences to annuity purchasers that are U.S. citizens or
residents. Purchasers that are not U.S. citizens or residents will
generally be subject to U.S. federal income tax and withholding on annuity
distributions at a 30% rate, unless a lower treaty rate applies. In
addition, purchasers may be subject to state premium tax, other state
and/or municipal taxes, and taxes that may be imposed by the purchaser's
country of citizenship or residence. Prospective purchasers are advised to
consult with a qualified tax adviser regarding U.S., state, and foreign
taxation with respect to an annuity purchase.
G. GENERATION-SKIPPING TRANSFERS
Under certain circumstances, the Internal Revenue Code may impose a
"generation-skipping transfer tax" when all or part of an annuity is
transferred to, or a death benefit is paid to, an individual two or more
generations younger than the owner. Federal tax law may require us to
deduct the tax from your Contract, or from any applicable payment, and
pay it directly to the Internal Revenue Service.
MISCELLANEOUS
How We Sell Our Annuity
Hartford Securities Distribution Company, Inc. ("HSD") serves as
Principal Underwriter for the securities issued with respect to the Separate
Account. HSD is a wholly owned subsidiary of Hartford Financial Services
Group Inc. The principal business address of HSD is the same as that of
Hart Life.
<PAGE>
42
The securities will be sold by salesperson of HSD who represent Hart
Life as insurance and variable annuity agents and who are registered
representatives.
HSD is registered with the Commission under the Securities Exchange Act of
1934 as a Broker-Dealer and is a member of the National Association of
Securities Dealers, Inc.
Commissions will be paid by Hart Life and will not be more than 6% of
Premium Payments. From time to time, Hart Life may pay or permit other
promotional incentives, in cash or credit or other compensation.
Broker-dealers or financial institutions are compensated according to a
schedule set forth by HSD and any applicable rules or regulations for variable
insurance compensation. Compensation is generally based on premium payments
made by policyholders or contract owners. This compensation is usually paid
from the sales charges described in this Prospectus.
In addition, a broker-dealer or financial institution may also receive
additional compensation for, among other things, training, marketing or other
services provided. HSD, its affiliates or Hart Life may also make
compensation arrangements with certain broker-dealers or financial
institutions based on total sales by the broker-dealer or financial
institution of insurance products. These payments, which may be different for
different broker-dealers or financial institutions, will be made by HSD, its
affiliates or Hart Life out of their own assets and will not effect the
amounts paid by the policyholders or contract owners to purchase, hold or
surrender variable insurance products.
The Contract may be sold directly to certain individuals under certain
circumstances that do not involve payment of any sales compensation to a
registered representative. In such case, Hart Life will credit the Contract
with an additional 5.0% of the premium payment. This additional percentage of
premium payment in no way affects present or future charges, rights, benefits
or current values of other Contract Owners. The following class of
individuals are eligible for this feature: (1) current or retired officers,
directors, trustees and employees (and their families) of the ultimate parent
and affiliates of Hart Life; and (2) employees and registered representatives
(and their families) of registered broker-dealers (or financial institutions
affiliated therewith) that have a sales agreement with Hart Life and its
principal underwriter to sell the Contracts.
Legal Matters and Experts
There are no material legal proceedings pending to which the Separate
Account is a party.
Counsel with respect to federal laws and regulations applicable to the
issue and sale of the Contracts and with respect to Connecticut law is Lynda
Godkin, Senior Vice President, General Counsel and Corporate Secretary, Hart
Life Insurance Company, P.O. Box 2999, Hartford, Connecticut 06104-2999.
<PAGE>
43
The audited statutory financial statements included in this registration
statement have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report with respect thereto, and are
included herein in reliance upon the authority of said firm as experts in
giving said report. Reference is made to the report on the statutory
financial statements of Hart Life Insurance Company which states the
statutory financial statements are presented in accordance with statutory
accounting practices prescribed or permitted by the National Association of
Insurance Commissioners and the State of Connecticut Insurance Department,
and are not presented in accordance with generally accepted accounting
principles. The principal business address of Arthur Andersen LLP is One
Financial Plaza, Hartford, Connecticut 06103.
ADDITIONAL INFORMATION
Inquiries will be answered by calling your representative or by writing:
Hart Life Insurance Company
Attn: Investment Product Services
P.O. Box 5085
Hartford, Connecticut 06102-5085
Telephone: (800) 862-6668
<PAGE>
44
APPENDIX I
INFORMATION REGARDING TAX-QUALIFIED RETIREMENT PLANS
This summary does not attempt to provide more than general information about
the federal income tax rules associated with use of a Contract by a
tax-qualified retirement plan. Because of the complexity of the federal tax
rules, owners, participants and beneficiaries are encouraged to consult their
own tax advisors as to specific tax consequences.
The federal tax rules applicable to owners of Contracts under tax-qualified
retirement plans vary according to the type of plan as well as the terms and
conditions of the plan itself. Contract Owners, plan participants and
beneficiaries are cautioned that the rights and benefits of any person may be
controlled by the terms and conditions of the tax-qualified retirement plan
itself, regardless of the terms and conditions of a Contract. We are not
bound by the terms and conditions of such plans to the extent such terms
conflict with a Contract, unless we specifically consent to be bound.
Some tax-qualified retirement plans are subject to distribution and other
requirements that are not incorporated into our administrative procedures.
Contract Owners, participants and beneficiaries are responsible for
determining that contributions, distributions and other transactions comply
with applicable law. Tax penalties may apply to transactions with respect to
tax-qualified retirement plans if applicable federal income tax rules and
restrictions are not carefully observed.
We do not currently offer the Contracts in connection with all of the types
of tax-qualified retirement plans discussed below and may not offer the
Contracts for all types of tax-qualified retirement plans in the future.
1. TAX-QUALIFIED PENSION OR PROFIT-SHARING PLANS Eligible employers can
establish certain tax-qualified pension and profit-sharing plans under
section 401 of the Code. Rules under section 401(k) of the Code govern
certain "cash or deferred arrangements" under such plans. Rules under
section 408(k) govern "simplified employee pensions". Tax-qualified
pension and profit-sharing plans are subject to limitations on the amount
that may be contributed, the persons who may be eligible to participate and
the time when distributions must commence. Employers intending to use the
Contracts in connection with tax-qualified pension or profit-sharing plans
should seek competent tax and other legal advice.
2. TAX SHELTERED ANNUITIES UNDER SECTION 403(b) Public schools and certain
types of charitable, educational and scientific organizations, as specified
in section 501(c)(3) of the Code, can purchase tax-sheltered annuity
contracts for their employees. Tax-deferred contributions can be made to
tax-sheltered annuity contracts under section 403(b) of the Code, subject
to certain limitations. Generally, such contributions may not exceed the
lesser of $10,500 (indexed) or 20% of the employee's "includable
compensation" for such employee's most recent full year of employment,
subject to other adjustments. Special provisions under the Code may allow
some employees to elect a different overall limitation.
<PAGE>
45
Tax-sheltered annuity programs under section 403(b) are subject to a
PROHIBITION AGAINST DISTRIBUTIONS FROM THE CONTRACT ATTRIBUTABLE TO
CONTRIBUTIONS MADE PURSUANT TO A SALARY REDUCTION AGREEMENT, unless such
distribution is made:
- after the participating employee attains age 59 1/2;
- upon separation from service;
- upon death or disability; or
- in the case of hardship (and in the case of hardship, any income
attributable to such contributions may not be distributed).
Generally, the above restrictions do not apply to distributions
attributable to cash values or other amounts held under a section 403(b)
contract as of December 31, 1988.
3. DEFERRED COMPENSATION PLANS UNDER SECTION 457 A governmental employer or
a tax-exempt employer other than a governmental unit can establish a
Deferred Compensation Plan under section 457 of the Code. For these
purposes, a "governmental employer" is a State, a political subdivision of
a State, or an agency or an instrumentality of a State or political
subdivision of a State. Employees and independent contractors performing
services for a governmental or tax-exempt employer can elect to have
contributions made to a Deferred Compensation Plan of their employer in
accordance with the employer's plan and section 457 of the Code.
Deferred Compensation Plans that meet the requirements of section 457(b)
of the Code are called "eligible" Deferred Compensation Plans. Section
457(b) limits the amount of contributions that can be made to an
eligible Deferred Compensation Plan on behalf of a participant.
Generally, the limitation on contributions is 33 1/3% of a participant's
includable compensation (typically 25% of gross compensation) or, for
2000, $8,000 (indexed), whichever is less. The plan may provide for
additional "catch-up" contributions during the three taxable years
ending before the year in which the participant attains normal
retirement age.
All of the assets and income of an eligible Deferred Compensation Plan
of a governmental employer must be held in trust for the exclusive
benefit of participants and their beneficiaries. For this purpose,
custodial accounts and certain annuity contracts are treated as trusts.
The requirement of a trust does not apply to amounts under a Deferred
Compensation Plan of a tax-exempt (non-governmental) employer. In
addition, the requirement of a trust does not apply to amounts under a
Deferred Compensation Plan of a governmental employer if the Deferred
Compensation Plan is not an eligible plan within the meaning of section
457(b) of the Code. In the
<PAGE>
46
absence of such a trust, amounts under the plan will be subject to the
claims of the employer's general creditors.
In general, distributions from an eligible Deferred Compensation Plan
are prohibited under section 457 of the Code unless made after the
participating employee:
- attains age 70 1/2,
- separates from service,
- dies, or
- suffers an unforeseeable financial emergency as defined in the Code.
Under present federal tax law, amounts accumulated in a Deferred
Compensation Plan under section 457 of the Code cannot be transferred or
rolled over on a tax-deferred basis except for certain transfers to
other Deferred Compensation Plans under section 457 in limited cases.
4. INDIVIDUAL RETIREMENT ANNUITIES ("IRAs") UNDER SECTION 408
TRADITIONAL IRAs. Eligible individuals can establish individual
retirement programs under section 408 of the Code through the purchase
of an IRA. Section 408 imposes limits with respect to IRAs, including
limits on the amount that may be contributed to an IRA, the amount of
such contributions that may be deducted from taxable income, the persons
who may be eligible to contribute to an IRA, and the time when
distributions commence from an IRA. Distributions from certain
tax-qualified retirement plans may be "rolled-over" to an IRA on a
tax-deferred basis.
SIMPLE IRAs. Eligible employees may establish SIMPLE IRAs in connection
with a SIMPLE IRA plan of an employer under section 408(p) of the Code.
Special rollover rules apply to SIMPLE IRAs. Amounts can be rolled over
from one SIMPLE IRA to another SIMPLE IRA. However, amounts can be
rolled over from a SIMPLE IRA to a Traditional IRA only after two years
have expired since the employee first commenced participation in the
employer's SIMPLE IRA plan. Amounts cannot be rolled over to a SIMPLE
IRA from a qualified plan or a Traditional IRA. Hart Life is a
non-designated financial institution for purposes of the SIMPLE IRA
rules.
ROTH IRAs. Eligible individuals may establish Roth IRAs under section
408A of the Code. Contributions to a Roth IRA are not deductible.
Subject to special limitations, a Traditional IRA may be converted into
a Roth IRA or a distribution from a Traditional IRA may be rolled over
to a Roth IRA. However, a conversion or a rollover from a Traditional
IRA to a Roth IRA is not excludable from gross income. If certain
conditions are met, qualified distributions from a Roth IRA are tax-free.
5. FEDERAL TAX PENALTIES AND WITHHOLDING Distributions from tax-qualified
retirement plans are generally taxed as ordinary income under section 72
<PAGE>
47
of the Code. Under these rules, a portion of each distribution may be
excludable from income. The excludable amount is the portion of the
distribution that bears the same ratio as the after-tax contributions
bear to the expected return.
(a) PENALTY TAX ON EARLY DISTRIBUTIONS Section 72(t) of the Code imposes
an additional penalty tax equal to 10% of the taxable portion of a
distribution from certain tax-qualified retirement plans. However,
the 10% penalty tax does not apply to a distributions that is:
- Made on or after the date on which the employee reaches age 59 1/2;
- Made to a beneficiary (or to the estate of the employee) on or
after the death of the employee;
- Attributable to the employee's becoming disabled (as defined in
the Code);
- Part of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life
expectancy) of the employee or the joint lives (or joint life
expectancies) of the employee and his or her designated
beneficiary;
- Except in the case of an IRA, made to an employee after separation
from service after reaching age 55; or
- Not greater than the amount allowable as a deduction to the
employee for eligible medical expenses during the taxable year.
In addition, the 10% penalty tax does not apply to a distribution
from an IRA that is:
- Made after separation from employment to an unemployed IRA owner
for health insurance premiums, if certain conditions are met;
- Not in excess of the amount of certain qualifying higher education
expenses, as defined by section 72(t)(7) of the Code; or
- A qualified first-time homebuyer distribution meeting the
requirements specified at section 72(t)(8) of the Code.
If you are a participant in a SIMPLE IRA plan, you should be aware
that the 10% penalty tax is increased to 25% with respect to
non-exempt early distributions made from your SIMPLE IRA during the
first two years following the date you first commenced
participation in any SIMPLE IRA plan of your employer.
<PAGE>
48
(b) MINIMUM DISTRIBUTION PENALTY TAX If the amount distributed is less
than the minimum required distribution for the year, the Participant
is subject to a 50% penalty tax on the amount that was not properly
distributed.
An individual's interest in a tax-qualified retirement plan
generally must be distributed, or begin to be distributed, not
later than the Required Beginning Date. Generally, the Required
Beginning Date is April 1 of the calendar year following the later
of:
- the calendar year in which the individual attains age 70 1/2; or
- the calendar year in which the individual retires from service
with the employer sponsoring the plan.
The Required Beginning Date for an individual who is a five (5)
percent owner (as defined in the Code), or who is the owner of an
IRA, is April 1 of the calendar year following the calendar year in
which the individual attains age 70 1/2.
The entire interest of the Participant must be distributed
beginning no later than the Required Beginning Date over:
- the life of the Participant or the lives of the Participant and
the Participant's designated beneficiary, or
- over a period not extending beyond the life expectancy of the
Participant or the joint life expectancy of the Participant and
the Participant's designated beneficiary.
Each annual distribution must equal or exceed a "minimum
distribution amount" which is determined by dividing the account
balance by the applicable life expectancy. This account balance is
generally based upon the account value as of the close of business
on the last day of the previous calendar year. In addition,
minimum distribution incidental benefit rules may require a larger
annual distribution.
If an individual dies before reaching his or her Required Beginning
Date, the individual's entire interest must generally be
distributed within five years of the individual's death. However,
this rule will be deemed satisfied, if distributions begin before
the close of the calendar year following the individual's death to
a designated beneficiary and distribution is over the life of such
designated beneficiary (or over a period not extending beyond the
life expectancy of the beneficiary). If the beneficiary is the
individual's surviving spouse, distributions may be delayed until
the individual would have attained age 70 1/2.
If an individual dies after reaching his or her Required Beginning
Date or after distributions have commenced, the individual's
<PAGE>
49
interest must generally be distributed at least as rapidly as under
the method of distribution in effect at the time of the
individual's death.
(c) WITHHOLDING In general, regular wage withholding rules apply to
distributions from IRAs and plans described in section 457 of the
Code. Periodic distributions from other tax-qualified retirement
plans that are made for a specified period of 10 or more years or
for the life or life expectancy of the participant (or the joint
lives or life expectancies of the participant and beneficiary) are
generally subject to federal income tax withholding as if the
recipient were married claiming three exemptions. The recipient of
periodic distributions may generally elect not to have withholding
apply or to have income taxes withheld at a different rate by
providing a completed election form.
Mandatory federal income tax withholding at a flat rate of 20% will
generally apply to other distributions from such other
tax-qualified retirement plans unless such distributions are:
- the non-taxable portion of the distribution;
- required minimum distributions; or
- direct transfer distributions.
Direct transfer distributions are direct payments to an IRA or to
another eligible retirement plan under Code section 401(a)(31).
Certain states require withholding of state taxes when federal
income tax is withheld.
<PAGE>
50
TABLE OF CONTENTS
TO
STATEMENT OF ADDITIONAL INFORMATION
SECTION PAGE
Description of Hart Life Insurance Company
Safekeeping of Assets
Independent Public Accountants
Distribution of Contracts
Calculation of Yield and Return
Performance Comparisons
Financial Statements
<PAGE>
51
This form must be completed for all tax-sheltered annuities.
SECTION 403(b)(11) ACKNOWLEDGMENT FORM
The Hart Life variable annuity Contract that you have recently purchased is
subject to certain restrictions imposed by the Tax Reform Act of 1986.
Contributions to the Contract after December 31, 1988 and any increases in
cash value after December 31, 1988 may not be distributed to you unless you
have:
a. Attained age 59 1/2,
b. Separated from service,
c. Died, or
d. Become disabled.
Distributions of post December 31, 1988 contributions (excluding any income
thereon) may also be made if you have experienced a financial hardship.
Also, there may be a 10% penalty tax for distributions made prior to age 59 1/2
because of financial hardship or separation from service.
Also, please be aware that your 403(b) Plan may also offer other financial
alternatives other than your variable annuity. Please refer to your Plan.
Please complete the following and return to:
Hart Life Insurance Company
Investment Product Services
P.O. Box 5085
Hartford, Connecticut 06102-5085
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Name of You/Participant: ____________________________________________
Address: ____________________________________________________________
City or Plan/School District: _______________________________________
Date: _______________________________________________________________
Contract No: ________________________________________________________
Signature: __________________________________________________________
<PAGE>
52
- - - - - - - - - - - - - - - - - -
To Obtain a Statement of Additional Information, please complete the form below
and mail to:
Hart Life Insurance Company
Attn: Investment Product Services
P.O. Box 5085
Hartford, Connecticut 06102-5085
Please send a Statement of Additional Information to me at the following
address:
- -----------------------------------------------
Name
- -----------------------------------------------
Address
- -----------------------------------------------
City/State Zip Code
- - - - - - - - - - - - - - - - - - - - - - - - -
<PAGE>
PART B
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
SEPARATE ACCOUNT ONE
This Statement of Additional Information is not a prospectus. The information
contained herein should be read in conjunction with the Prospectus.
To obtain a Prospectus, send a written request to Hart Life Insurance Company
Attn: Investment Product Services, P.O. Box 5085, Hartford, Connecticut
06102-5085.
Date of Prospectus: May 1, 2000
Date of Statement of Additional Information: May 1, 2000
333-65507
<PAGE>
-2-
TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION PAGE
- ------- ----
<S> <C>
DESCRIPTION OF HART LIFE INSURANCE COMPANY............................... 3
SAFEKEEPING OF ASSETS ................................................... 3
INDEPENDENT PUBLIC ACCOUNTANTS .......................................... 3
DISTRIBUTION OF CONTRACTS................................................ 3
CALCULATION OF YIELD AND RETURN.......................................... 4
PERFORMANCE COMPARISONS.................................................. 7
FINANCIAL STATEMENTS ....................................................
</TABLE>
<PAGE>
-3-
DESCRIPTION OF HART LIFE INSURANCE COMPANY
Hart Life Insurance Company ("Hart Life") is a stock life insurance company
engaged in the business of writing life insurance in all states of the United
States and the District of Columbia. Hart Life was originally incorporated under
the laws of New Jersey on July 9, 1965 and was redomesticated to Connecticut on
November 23, 1998. Its offices are located in Simsbury, Connecticut; however,
its mailing address is P.O. Box 2999, Hartford, CT 06104-2999. On December 22,
1999, Hart Life changed its name from Alpine Life Insurance Company to Hart Life
Insurance Company. Hart Life is ultimately controlled by Hartford Financial
Services Group, Inc., one of the largest financial service providers in the
United States.
SAFEKEEPING OF ASSETS
Title to the assets of the Separate Account is held by Hart Life. The assets are
kept physically segregated and are held separate and apart from Hart Life's
general corporate assets. Records are maintained of all purchases and
redemptions of Fund shares held in each of the Sub-Accounts.
INDEPENDENT PUBLIC ACCOUNTANTS
The audited statutory financial statements included in this registration
statement have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report with respect thereto, and are included
herein in reliance upon the authority of said firm as experts in giving said
report. Reference is made to the report on the statutory financial statements of
Hart Life Insurance Company which states the statutory financial statements are
presented in accordance with statutory accounting practices prescribed or
permitted by the National Association of Insurance Commissioners and the State
of Connecticut Insurance Department, and are not presented in accordance with
generally accepted accounting principles. The principal business address of
Arthur Andersen LLP is One Financial Plaza, Hartford, Connecticut 06103.
DISTRIBUTION OF CONTRACTS
Hartford Securities Distribution Company, Inc. ("HSD") serves as principal
underwriter for the securities issued with respect to the Separate Account and
will offer the Contracts on a continuous basis.
HSD is a wholly-owned subsidiary of Hartford Financial Services Group, Inc.
The principal business address of HSD is the same as Hart Life.
<PAGE>
-4-
The securities will be sold by salespersons of HSD, who represent Hart Life as
insurance and Variable Annuity agents and who are registered representatives of
Broker-Dealers who have entered into distribution agreements with HSD.
HSD is registered with the Securities and Exchange Commission under the
Securities and Exchange Act of 1934 as a Broker-Dealer and is a member of the
National Association of Securities Dealers, Inc. ("NASD").
CALCULATION OF YIELD AND RETURN
YIELD AND EFFECTIVE YIELD OF A MONEY MARKET SUB-ACCOUNT. As summarized in the
Prospectus under the heading "Performance Related Information," the yield of
a Money Market Sub-Account for a seven day period (the "base period") will be
computed by determining the "net change in value" (calculated as set forth
below) of a hypothetical account having a balance of one accumulation unit of
the Sub-Account at the beginning of the period, subtracting a hypothetical
charge reflecting deductions from Contract Owner accounts, and dividing the
difference by the value of the account at the beginning of the base period to
obtain the base period return, and then multiplying the base period return by
365/7 with the resulting yield figure carried to the nearest hundredth of one
percent. Net changes in value of a hypothetical account will include net
investment income of the account (accrued daily dividends as declared by the
underlying funds, less daily expense charges of the account) for the period,
but will not include realized gains or losses or unrealized appreciation or
depreciation on the underlying fund shares.
The effective yield is calculated by compounding the base period return by
adding 1, raising the sum to a power equal to 365/7 and subtracting 1 from the
result, according to the following formula:
Effective Yield = [(Base Period Return + 1) to the power of 365/7] - 1
A MONEY MARKET SUB-ACCOUNT'S YIELD AND EFFECTIVE YIELD WILL VARY IN RESPONSE TO
FLUCTUATIONS IN INTEREST RATES AND IN THE EXPENSES OF THE SUB-ACCOUNT. THE
CURRENT YIELD AND EFFECTIVE YIELD REFLECT RECURRING CHARGES ON THE SEPARATE
ACCOUNT LEVEL, INCLUDING THE MAXIMUM ANNUAL MAINTENANCE FEE.
<TABLE>
<CAPTION>
YIELD AND EFFECTIVE YIELD FOR THE SEVEN DAY PERIOD ENDING DECEMBER 31, 1999
- -------------------------------------------------------------------------------------------------------
SUB-ACCOUNT YIELD EFFECTIVE YIELD
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
Hartford Money Market HLS Fund 4.09% 4.18%
- -------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
-5-
CALCULATION OF YIELD. As summarized in the Prospectus under the heading
"Performance Related Information," certain Sub-Accounts may advertise yield in
addition to total return. Yield will be computed by annualizing a recent month's
net investment income, divided by a Fund share's net asset value on the last
trading day of that month. Net changes in the value of a hypothetical account
will assume the change in the underlying mutual fund's "net asset value per
share" for the same period in addition to the daily expense charge assessed, at
the Sub-Account level for the respective period. The Sub-Accounts' yields will
vary from time to time depending upon market conditions and, the composition of
the underlying funds' portfolios. Yield should also be considered relative to
changes in the value of the Sub-Accounts' shares and to the relative risks
associated with the investment objectives and policies of the underlying Fund.
THE YIELD REFLECTS RECURRING CHARGES ON THE SEPARATE ACCOUNT LEVEL, INCLUDING
THE ANNUAL MAINTENANCE FEE.
Yield calculations of the Sub-Accounts used for illustration purposes reflect
the interest earned by the Sub-Accounts, less applicable asset charges assessed
against a Contract Owner's account over the base period. Yield quotations based
on a 30 day period were computed by dividing the dividends and interests earned
during the period by the maximum offering price per unit on the last day of the
period, according to the following formula:
Example:
Current Yield Formula for the Sub-Account
2[((A-B)/(CD) + 1) to the power of 6 - 1]
Where A = Dividends and interest earned during the period.
B = Expenses accrued for the period (net of reimbursements).
C = The average daily number of units outstanding during the period
that were entitled to receive dividends.
D = The maximum offering price per unit on the last day of the period.
<TABLE>
<CAPTION>
YIELD QUOTATION BASED ON A 30 DAY PERIOD ENDED DECEMBER 31, 1999
- ---------------------------------------------------------------------------------------------------
SUB-ACCOUNT YIELD
- ---------------------------------------------------------------------------------------------------
<S> <C>
Hartford Bond HLS Fund 5.69%
- ---------------------------------------------------------------------------------------------------
Hartford High Yield HLS Fund 8.30%
- ---------------------------------------------------------------------------------------------------
Hartford Mortgage Securities HLS Fund 5.51%
- ---------------------------------------------------------------------------------------------------
</TABLE>
At any time in the future, yields and total return may be higher or lower than
past yields
<PAGE>
-6-
and there can be no assurance that any historical results will continue.
CALCULATION OF TOTAL RETURN. As summarized in the Prospectus under the heading
"Performance Related Information," total return is a measure of the change in
value of an investment in a Sub-Account over the period covered. The formula for
total return used herein includes three steps: (1) calculating the value of the
hypothetical initial investment of $1,000 as of the end of the period by
multiplying the total number of units owned at the end of the period by the unit
value per unit on the last trading day of the period; (2) assuming redemption at
the end of the period and deducting any applicable contingent deferred sales
charge and (3) dividing this account value for the hypothetical investor by the
initial $1,000 investment and annualizing the result for periods of less than
one year. Standardized total return will be calculated since the inception of
the Separate Account for one year, five years and ten years or some other
relevant periods if a Sub-Account has not been in existence for at least ten
years.
<TABLE>
<CAPTION>
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FOR YEAR ENDED DECEMBER 31, 1999
- -------------------------------------------------------------------------------------------------------------------
INCEPTION SINCE
DATE OF INCEPTION
SEPARATE OF SEPARATE
SUB-ACCOUNT ACCOUNT 1 YEAR 5 YEAR 10 YEAR ACCOUNT
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Hartford Bond HLS Fund 9/1/98 -12.23% N/A N/A -9.76%
- -------------------------------------------------------------------------------------------------------------------
Hartford High Yield HLS Fund 10/1/98 -5.60% N/A N/A -4.06%
- -------------------------------------------------------------------------------------------------------------------
Hartford Index HLS Fund 9/1/98 10.00% N/A N/A 25.08%
- -------------------------------------------------------------------------------------------------------------------
Hartford Money Market HLS Fund 9/1/98 -5.41% N/A N/A -5.43%
- -------------------------------------------------------------------------------------------------------------------
Hartford Mortgage Securities 9/1/98 -8.74% N/A N/A -7.24%
HLS Fund
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
In addition to the standardized total return, the Sub-Accounts may advertise a
non-standardized total return. This figure will usually be calculated since the
inception of the underlying fund for one year, five years, and ten years or
other periods. Non-standardized total return is measured in the same manner as
the standardized total return described above, except that the contingent
deferred sales charge and the Annual Maintenance Fee are not deducted.
Therefore, non-standardized total return for a Sub-Account is higher than
standardized total return for a Sub-Account.
<PAGE>
-7-
<TABLE>
<CAPTION>
NON-STANDARDIZED ANNUALIZED TOTAL RETURN THAT PRE-DATE THE INCEPTION DATE OF THE SEPARATE ACCOUNT FOR YEAR ENDED
DECEMBER 31, 1999
- -------------------------------------------------------------------------------------------------------------------
INCEPTION DATE SINCE INCEPTION
SUB-ACCOUNT OF FUND 1 YEAR 5 YEAR 10 YEAR OF FUND
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Hartford Bond HLS Fund 8/31/77 -3.23% 6.34% 6.07% N/A
- -------------------------------------------------------------------------------------------------------------------
Hartford High Yield HLS Fund 10/1/98 3.40% N/A N/A 5.57%
- -------------------------------------------------------------------------------------------------------------------
Hartford Index HLS Fund 5/1/87 19.00% 26.23% 15.98% N/A
- -------------------------------------------------------------------------------------------------------------------
Hartford Money Market HLS Fund 6/30/80 3.59% 3.98% 3.80% N/A
- -------------------------------------------------------------------------------------------------------------------
Hartford Mortgage Securities 1/1/85 0.26% 6.25% 5.77% N/A
HLS Fund
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE COMPARISONS
YIELD AND TOTAL RETURN. Each Sub-Account may from time to time include its total
return in advertisements or in information furnished to present or prospective
shareholders. Each Sub-Account may from time to time include its yield and total
return in advertisements or information furnished to present or prospective
shareholders. Each Sub-Account may from time to time include in advertisements
its total return (and yield in the case of certain Sub-Accounts) the ranking of
those performance figures relative to such figures for groups of other annuities
analyzed by Lipper Analytical Services and Morningstar, Inc. as having the same
investment objectives.
The total return and yield may also be used to compare the performance of the
Sub-Accounts against certain widely acknowledged outside standards or indices
for stock and bond market performance. The Standard & Poor's Composite Index of
500 Stocks (the "S&P 500") is a market value-weighted and unmanaged index
showing the changes in the aggregate market value of 500 stocks relative to the
base period 1941-43. The S&P 500 is composed almost entirely of common stocks of
companies
<PAGE>
-8-
listed on the New York Stock Exchange, although the common stocks of a few
companies listed on the American Stock Exchange or traded over-the-counter are
included. The 500 companies represented include 400 industrial, 60
transportation and 40 financial services concerns. The S&P 500 represents about
80% of the market value of all issues traded on the New York Stock Exchange.
The NASDAQ-OTC Composite Price Index (The "NASDAQ Index") is a market
value-weighted and unmanaged index showing the changes in the aggregate market
value of approximately 3,500 stocks relative to the base measure of 100.00 on
February 5, 1971. The NASDAQ Index is composed entirely of common stocks of
companies traded over-the-counter and often through the National Association of
Securities Dealers Automated Quotations ("NASDAQ") system. Only those
over-the-counter stocks having only one market maker or traded on exchanges are
excluded.
The Morgan Stanley Capital International EAFE Index (the "EAFE Index") is an
unmanaged index, which includes over 1,000 companies representing the stock
markets of Europe, Australia, New Zealand, and the Far East. The EAFE Index is
weighted by market capitalization, and therefore, it has a heavy representation
in countries with large stock markets, such as Japan.
The Shearson Lehman Government Bond Index (the "SL Government Index") is a
measure of the market value of all public obligations of the U.S. Treasury; all
publicly issued debt of all agencies of the U.S. Government and all
quasi-federal corporations; and all corporate debt guaranteed by the U.S.
Government. Mortgage-backed securities, flower bonds and foreign targeted issues
are not included in the SL Government Index.
The Shearson Lehman Government/Corporate Bond Index (the "SL
Government/Corporate Index") is a measure of the market value of approximately
5,300 bonds with a face value currently in excess of $1.3 trillion. To be
included in the SL Government/Corporate Index, an issue must have amounts
outstanding in excess of $1 million, have at least one year to maturity and be
rated "Baa" or higher ("investment grade") by a nationally recognized rating
agency.
The Composite Index for Hartford Advisers Fund is comprised of the S&P 500
(55%), the Lehman Government/Corporate Bond Index (35%), both mentioned above,
and 90 Day U.S. Treasury Bills (10%).
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
----------------------------------------
To the Board of Directors of
Hart Life Insurance Company:
We have audited the accompanying statutory balance sheets of Hart Life Insurance
Company (a Connecticut Corporation and wholly owned subsidiary of Hartford Life
and Accident Insurance Company) (the Company) as of December 31, 1999 and 1998,
and the related statutory statements of operations, changes in capital and
surplus, and cash flows for each of the three years in the period ended December
31, 1999. These statutory financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
statutory financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
The Company presents its financial statements in conformity with statutory
accounting practices as described in Note 2 of notes to statutory financial
statements. When financial statements are presented for purposes other than for
filing with a regulatory agency, auditing standards generally accepted in the
United States require that an auditors' report on them state whether they are
presented in conformity with accounting principles generally accepted in the
United States. The accounting practices used by the Company vary from accounting
principles generally accepted in the United States as explained and quantified
in Note 2.
In our opinion, because of the effects of the matter discussed in the preceding
paragraph, the statutory financial statements referred to above do not present
fairly, in conformity with accounting principles generally accepted in the
United States, the financial position of the Company as of 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.
<PAGE>
In our opinion, the statutory financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
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 statutory accounting practices as described in Note 2.
Hartford, Connecticut ARTHUR ANDERSEN LLP
January 31, 2000
<PAGE>
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
BALANCE SHEETS
(STATUTORY BASIS)
($000)
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
--------------------
1999 1998
------- -------
<S> <C> <C>
ASSETS
Bonds $ 7,617 $ 8,265
Cash and Short-Term Investments 2,723 1,791
- --------------------------------------------------------------------------------
TOTAL CASH AND INVESTED ASSETS 10,340 10,056
- --------------------------------------------------------------------------------
Investment Income Due and Accrued 169 199
Other Assets 39 134
- --------------------------------------------------------------------------------
TOTAL ASSETS $10,548 $10,389
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
LIABILITIES
Payables to Affiliates $ 75 $ 65
Federal Income Taxes Accrued -- 132
Other Liabilities 7 141
- --------------------------------------------------------------------------------
TOTAL LIABILITIES 82 338
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CAPITAL AND SURPLUS
Common Stock 2,500 2,500
Gross Paid-In and Contributed Surplus 6,203 6,203
Unassigned Funds 1,763 1,348
- --------------------------------------------------------------------------------
TOTAL CAPITAL AND SURPLUS 10,466 10,051
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL LIABILITIES, CAPITAL AND SURPLUS $10,548 $10,389
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of
these statutory basis financial statements.
3
<PAGE>
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
STATEMENTS OF OPERATIONS
(STATUTORY BASIS)
($000)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
-----------------------------------------------------
-----------------------------------------------------
1999 1998 1997
--------------- --------------- ---------------
<S> <C> <C> <C>
REVENUES
Net Investment Income $ 537 $ 559 $ 528
Amortization of Interest Maintenance Reserve (7) (25) (50)
Other Revenues -- -- 2
- ------------------------------------------------------------------------------------------------------------------
TOTAL REVENUES 530 534 480
- ------------------------------------------------------------------------------------------------------------------
BENEFITS AND EXPENSES
General Insurance Expenses 18 3 --
Insurance Taxes, Licenses and Fees 51 58 137
- ------------------------------------------------------------------------------------------------------------------
TOTAL BENEFITS AND EXPENSES 69 61 137
- ------------------------------------------------------------------------------------------------------------------
NET GAIN FROM OPERATIONS BEFORE FEDERAL INCOME TAX EXPENSE 461 473 343
Federal Income Tax Expense 57 92 135
- ------------------------------------------------------------------------------------------------------------------
NET GAIN FROM OPERATIONS 404 381 208
- ------------------------------------------------------------------------------------------------------------------
Net Realized Capital Gains, after tax 1 -- --
- ------------------------------------------------------------------------------------------------------------------
NET INCOME $ 405 $ 381 $ 208
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of
these statutory basis financial statements.
4
<PAGE>
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
STATEMENTS OF CHANGES IN CAPITAL AND SURPLUS
(STATUTORY BASIS)
($000)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
---------------------------------------------------
1999 1998 1997
--------------- --------------- ---------------
<S> <C> <C> <C>
COMMON STOCK,
- --------------------------------------------------------------------------------------------
Beginning and End of Year $ 2,500 $ 2,500 $ 2,500
- --------------------------------------------------------------------------------------------
GROSS PAID-IN AND CONTRIBUTED SURPLUS,
- --------------------------------------------------------------------------------------------
Beginning and End of Year 6,203 6,203 6,203
- --------------------------------------------------------------------------------------------
UNASSIGNED FUNDS
Balance, Beginning of Year 1,348 942 685
Net Income 405 381 208
Change in Non-Admitted Assets 10 25 49
- --------------------------------------------------------------------------------------------
Balance, End of Year 1,763 1,348 942
- --------------------------------------------------------------------------------------------
CAPITAL AND SURPLUS,
- --------------------------------------------------------------------------------------------
End of Year $ 10,466 $ 10,051 $ 9,645
- --------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of
these statutory basis financial statements.
5
<PAGE>
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
STATEMENTS OF CASH FLOWS
(STATUTORY BASIS)
($000)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
----------------------------------
1999 1998 1997
------- ---------- ----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net Investment Income $ 680 $ 658 $ 558
------- ---------- ----------
TOTAL INCOME 680 658 558
------- ---------- ----------
Benefits Paid -- -- (621)
Federal Income Tax Payments 213 34 84
Other Expenses 82 84 180
------- ---------- ----------
TOTAL BENEFITS AND EXPENSES 295 118 (357)
------- ---------- ----------
- -----------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 385 540 915
- -----------------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
PROCEEDS FROM INVESTMENTS SOLD
Bonds 2,242 150 1,345
------- ---------- ----------
NET INVESTMENT PROCEEDS 2,242 150 1,345
------- ---------- ----------
COST OF INVESTMENTS ACQUIRED
Bonds 1,702 153 2,581
------- ---------- ----------
TOTAL INVESTMENTS ACQUIRED 1,702 153 2,581
------- ---------- ----------
- -----------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES 540 (3) (1,236)
- -----------------------------------------------------------------------------------------------------------------
FINANCING AND MISCELLANEOUS ACTIVITIES
Net other cash provided (used) 7 (55) 63
- -----------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY (USED FOR) FINANCING AND MISCELLANEOUS ACTIVITIES 7 (55) 63
- -----------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND SHORT-TERM INVESTMENTS 932 482 (258)
CASH AND SHORT-TERM INVESTMENTS, BEGINNING OF YEAR 1,791 1,309 1,567
- -----------------------------------------------------------------------------------------------------------------
CASH AND SHORT-TERM INVESTMENTS, END OF YEAR $ 2,723 $ 1,791 $ 1,309
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of
these statutory basis financial statements.
6
<PAGE>
HART LIFE INSURANCE COMPANY
(FORMERLY ALPINE LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(STATUTORY BASIS)
DECEMBER 31, 1999
(AMOUNTS IN THOUSANDS UNLESS OTHERWISE STATED)
1. ORGANIZATION AND DESCRIPTION OF BUSINESS:
-----------------------------------------
Hart Life Insurance Company (formerly Alpine Life Insurance Company) ("Hart
Life" or the "Company") is a wholly owned subsidiary of Hartford Life and
Accident Insurance Company ("HLA"), which is a direct subsidiary of
Hartford Life, Inc. ("HLI"). HLI is indirectly majority owned by The
Hartford Financial Services Group, Inc. ("The Hartford"). On February 10,
1997, HLI filed a registration statement, as amended, with the Securities
and Exchange Commission relating to the initial public offering of HLI
Class A Common Stock (the "Offering"). Pursuant to the Offering on May 22,
1997, HLI sold to the public 26 million shares, representing approximately
18.6% of the equity ownership of HLI. In 1999, Hart Life Insurance Company
changed its name from Alpine Life Insurance Company. Hart Life is licensed
in several states to sponsor variable and fixed annuities.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
-------------------------------------------
BASIS OF PRESENTATION
---------------------
The accompanying Hart Life statutory basis financial statements were
prepared in conformity with statutory accounting practices prescribed or
permitted by the National Association of Insurance Commissioners ("NAIC")
and the State of Connecticut Department of Insurance for 1999 and 1998,
respectively, and the NAIC and the New Jersey Department of Insurance for
1997. Certain reclassifications have been made to prior year financial
information to conform to the current year presentation.
Current prescribed statutory accounting practices include accounting
publications of the NAIC, as well as state laws, regulations and general
administrative rules. Permitted statutory accounting practices encompass
accounting practices approved by state insurance departments. The Company
does not follow any permitted statutory accounting practices that have a
material effect on statutory surplus, statutory net income or risk-based
capital.
The preparation of financial statements in conformity with statutory
accounting principles, requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reported periods. Actual results could differ from those
estimates. Although some variability is inherent in these estimates,
management believes the amounts provided are adequate.
STATUTORY ACCOUNTING PRACTICES VERSUS GAAP
------------------------------------------
Statutory accounting practices and generally accepted accounting principles
("GAAP") differ in certain significant respects. These differences
principally involve:
(1) treatment of policy acquisition costs (commissions, underwriting and
selling expenses, etc.) which are charged to expense when incurred for
statutory purposes rather than on a pro-rata basis over the expected
life and gross profit stream of the policy for GAAP purposes;
(2) recognition of premium revenues, which for statutory purposes are
generally recorded as collected or when due during the premium paying
period of the contract and which for GAAP purposes, for universal life
policies and investment products, generally only consist of charges
assessed to policy account balances for cost of insurance, policy
administration and surrenders. When policy charges received
7
<PAGE>
relate to coverage or services to be provided in the future, the
charges are recognized as revenue on a pro-rata basis over the
expected life and gross profit stream of the policy. Also, for GAAP
purposes, premiums for traditional life insurance policies are
recognized as revenues when they are due from policyholders;
(3) development of liabilities for future policy benefits, which for
statutory purposes predominantly use interest rate and mortality
assumptions prescribed by the NAIC which may vary considerably from
interest and mortality assumptions used under GAAP;
(4) providing for income taxes based on current taxable income only for
statutory purposes, rather than establishing additional assets or
liabilities for deferred Federal income taxes to recognize the tax
effect related to reporting revenues and expenses in different periods
for financial reporting and tax return purposes or required under
GAAP;
(5) excluding certain assets designated as non-admitted assets (e.g.,
negative Interest Maintenance Reserve and past due agents' balances)
from the balance sheet for statutory purposes by directly charging
surplus;
(6) the calculation of post retirement benefits obligation which, for
statutory accounting, excludes non-vested employees whereas GAAP
liabilities include a provision for such employees; statutory and GAAP
accounting permit either immediate recognition of the liability or
straight-line amortization of the liability over a period not to
exceed 20 years. For GAAP, The Hartford's obligation was immediately
recognized, whereas for statutory accounting, the obligation is being
recognized ratably over a 20-year period;
(7) establishing a formula reserve for realized and unrealized losses due
to default and equity risk associated with certain invested assets
(Asset Valuation Reserve) for statutory purposes; as well as the
deferral and amortization of realized gains and losses, caused by
changes in interest rates during the period the asset is held, into
income over the remaining life to maturity of the asset sold (Interest
Maintenance Reserve) for statutory purposes; whereas on a GAAP basis,
no such formula reserve is required and realized gains and losses are
recognized in the period the asset is sold;
(8) the reporting of reserves and benefits net of reinsurance ceded for
statutory purposes; whereas on a GAAP basis, reserves are reported
gross of reinsurance with reserve credits presented as recoverable
assets;
(9) the reporting of fixed maturities at amortized cost for statutory
purposes, whereas GAAP requires that fixed maturities be classified as
"held-to-maturity", "available-for-sale" or "trading", based on the
Company's intentions with respect to the ultimate disposition of the
security and its ability to affect those intentions. The Company's
bonds were classified on a GAAP basis as "available-for-sale" and
accordingly, those investments and common stocks were reflected at
fair value with the corresponding impact included as a separate
component of Stockholder's Equity; as well as the change in the basis
of the Company's other invested assets, which consist primarily of
limited partnership investments, which is recognized as income under
GAAP and as a change in surplus under statutory accounting; and
(10) statutory accounting calculates separate account liabilities using
prescribed actuarial methodologies, which approximate the market value
of separate account assets, less applicable surrender charges. The
separate account surplus generated by these reserving methods is
recorded as an amount due to or from the separate account on the
statutory basis balance sheet, with changes reflected in the
8
<PAGE>
statutory basis results of operations. On a GAAP basis, separate
account assets and liabilities are held at fair value.
As of and for the years ended December 31, the significant differences
between statutory and GAAP basis net income and capital and surplus for the
Company are as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------------------------------------------------------------------------------------
<S> <C> <C> <C>
GAAP Net Income $ 267 $ 281 $ 212
Amortization of Goodwill 62 67 62
Deferred taxes 87 59 (21)
Interest maintenance reserve (10) (25) (50)
Other, net (1) (1) 5
------------------------------------------------------------------------------------------
Statutory Net Income $ 405 $ 381 $ 208
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
1999 1998 1997
------------------------------------------------------------------------------------------
GAAP Stockholder's Equity $ 12,468 $ 12,320 $ 11,970
Goodwill (2,149) (2,211) (2,278)
Deferred taxes 113 89 (7)
Unrealized losses (gains) on bonds 35 (146) (40)
Other, net (1) (1) --
------------------------------------------------------------------------------------------
Statutory Capital and Surplus $ 10,466 $ 10,051 $ 9,645
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
</TABLE>
AGGREGATE RESERVES FOR FUTURE BENEFITS AND LIABILITIES FOR PREMIUM AND
----------------------------------------------------------------------
OTHER DEPOSIT FUNDS
-------------------
Aggregate reserves for payment of future life, health and annuity benefits
were computed in accordance with applicable actuarial standards.
Accumulation and on-benefit annuity reserves are based principally on
individual annuity tables at various rates ranging from 4.5% to 10% and
using the Commissioners Annuity Reserve Valuation Method ("CARVM").
INVESTMENTS
-----------
Investments in bonds are carried at amortized cost. Bonds that are deemed
ineligible to be held at amortized cost by the NAIC Securities Valuation
Office ("SVO") are carried at the appropriate SVO published value. When a
reduction in the value of a security is deemed to be unrecoverable, the
decline in value is reported as a realized loss and the carrying value is
adjusted accordingly. Short-term investments consist of money market funds
and are stated at cost, which approximates fair value.
The Asset Valuation Reserve ("AVR") is designed to provide a standardized
reserving process for realized and unrealized losses due to default and
equity risks associated with invested assets. As of December 31, 1999 and
1998, the AVR balance was immaterial. Additionally, the Interest
Maintenance Reserve ("IMR") captures net realized capital gains and losses,
net of applicable income taxes, resulting from changes in interest rates
and amortizes these gains or losses into income over the life of the bond.
The IMR balance as of December 31, 1999 and December 31, 1998 were asset
balances of $1 and $10, respectively, and are reflected as non-admitted
assets in Unassigned Funds in accordance with statutory accounting
practices. Realized capital gains and losses, net of taxes, not included in
the IMR are reported in the statutory basis
9
<PAGE>
statements of operations. Realized investment gains and losses are
determined on a specific identification basis.
CODIFICATION
------------
The NAIC adopted the Codification of Statutory Accounting principles in
March 1998. The proposed effective date for this statutory accounting
guidance is January 1, 2001. It is expected that Connecticut, the Company's
domiciliary state, will adopt these accounting standards and, therefore,
the Company will make the necessary accounting and reporting changes
required for implementation. The Company has not yet determined the impact
that these new accounting standards will have on its statutory basis
financial statements.
3. INVESTMENTS:
------------
(a) COMPONENTS OF NET INVESTMENT INCOME
----------------------------------------
<TABLE>
<CAPTION>
1999 1998 1997
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income from bonds and short-term investments $ 543 $ 561 $ 529
Interest and dividends from other investments - 3 1
-------------------------------------------------------------------------------------------------------------
Gross investment income 543 564 530
Less: Investment expenses (6) (5) (2)
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME $ 537 $ 559 $ 528
-------------------------------------------------------------------------------------------------------------
</TABLE>
(b) COMPONENTS OF NET UNREALIZED CAPITAL (LOSSES) GAINS ON BONDS AND
---------------------------------------------------------------------
SHORT-TERM INVESTMENTS
----------------------
<TABLE>
<CAPTION>
1999 1998 1997
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Gross unrealized capital gains $ 5 $ 142 $ 52
Gross unrealized capital losses (39) (1) (12)
-------------------------------------------------------------------------------------------------------------
Net unrealized capital (losses) gains (34) 141 40
Balance, beginning of year 141 40 (56)
-------------------------------------------------------------------------------------------------------------
Change in net unrealized capital (losses) gains
on bonds and short-term investments $ (175) $ 101 $ 96
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
</TABLE>
(C) COMPONENTS OF NET REALIZED CAPITAL GAINS (LOSSES)
------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998 1997
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Bonds and short-term investments $ 3 $ - $ (1)
--------------------------------------------------------------------------------------------------------------
Realized capital gains (losses) 3 - (1)
Capital gains tax - - -
--------------------------------------------------------------------------------------------------------------
Net realized capital gains (losses) 3 - (1)
Less: amount transferred to the IMR 2 - (1)
--------------------------------------------------------------------------------------------------------------
Net realized capital gains $ 1 $ - $ -
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
Sales and maturities of investments in bonds and short-term investments for
the years ended December 31, 1999, 1998, and 1997 resulted in proceeds of
$18,822, $11,904, and $19,775, gross realized capital gains of $3 for 1999,
immaterial gross realized capital gains for 1998 and 1997, before transfer
to the IMR, and immaterial gross realized capital losses for 1999, 1998 and
1997.
(D) DERIVATIVE INVESTMENTS
--------------------------
The Company had no significant derivative holdings as of December 31, 1999
or 1998.
(E) CONCENTRATION OF CREDIT RISK
--------------------------------
Excluding U.S. government and government agency investments, the Company is
not exposed to any significant concentration of credit risk in fixed
maturities of a single issuer greater than 10% of capital and surplus as of
December 31, 1999.
(F) BONDS AND SHORT-TERM INVESTMENTS
------------------------------------
<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED FAIR
1999 COST GAINS LOSSES VALUE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S government and government agencies and authorities:
-Guaranteed and sponsored $ 7,617 $ 5 $ (39) $ 7,583
Short-term investments 2,144 - - 2,144
Certificates of deposit 500 - - 500
-----------------------------------------------------------------------------------------------------------------------
Total bonds and short-term investments $ 10,261 $ 5 $ (39) $ 10,227
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED FAIR
1998 COST GAINS LOSSES VALUE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S government and government agencies and authorities:
-Guaranteed and sponsored $ 8,265 $ 142 $ (1) $ 8,406
Short-term investments 1,287 - - 1,287
Certificates of deposit 500 - - 500
-----------------------------------------------------------------------------------------------------------------------
Total bonds and short-term investments $ 10,052 $ 142 $ (1) $ 10,193
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
The amortized cost and estimated fair value of bonds and short-term
investments as of December 31, 1999 by estimated maturity year are shown
below. Expected maturities differ from contractual maturities due to call
or prepayment provisions.
<TABLE>
<CAPTION>
AMORTIZED FAIR
MATURITY COST VALUE
--------------------------------------------------------------------------------
<S> <C> <C>
One year or less $ 5,801 $ 5,782
Over one year through five years 4,460 4,445
--------------------------------------------------------------------------------
Total $ 10,261 $ 10,227
--------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
Bonds with a carrying value of $6,815 were on deposit as of December
31, 1999 with various regulatory authorities as required.
(G) FAIR VALUE OF FINANCIAL INSTRUMENTS BALANCE SHEET ITEMS
-----------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998
-------------------------- --------------------------
ESTIMATED ESTIMATED
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Assets
Bonds and short-term investments $ 10,261 $ 10,227 $ 10,052 $10,193
</TABLE>
The estimated fair value of bonds and short-term investments was determined
by the Company primarily using NAIC market values.
4. AGGREGATE RESERVES FOR FUTURE BENEFITS AND REINSURANCE
------------------------------------------------------
The Company's existing life reserves consist of deferred fixed annuities
and supplementary contracts. The Company cedes 100% of its insurance to Met
Life Security Insurance Company of Louisiana in order to eliminate its
insurance risk. Ceding this business, however, does not relieve the Company
of its primary liability to its policyholders, and therefore, if the
assuming reinsurer does not fulfill its obligations, the Company may suffer
losses.
There were no material reinsurance premiums assumed or ceded or reinsurance
recoverables from reinsurers outstanding as of, and for the years ended
December 31, 1999, 1998 or 1997.
The effect of reinsurance on reserve for future benefit balances as of
December 31, is summarized as follows:
<TABLE>
<CAPTION>
1999 1998
-----------------------------------------------------------------------------------------
<S> <C> <C>
Annuities $ 27,222 $ 29,059
Supplemental contracts 136 1,355
-----------------------------------------------------------------------------------------
27,358 30,414
Reinsurance ceded (27,358) (30,414)
-----------------------------------------------------------------------------------------
Reserves for Future Benefits, net $ - $ -
-----------------------------------------------------------------------------------------
</TABLE>
12
<PAGE>
An analysis of Annuity Actuarial Reserves and Deposit Liabilities by
Withdrawal Characteristics as of December 31, 1999 is as follows:
<TABLE>
<CAPTION>
% OF
AMOUNT TOTAL
----------------------------------------------------------------------------
<S> <C> <C>
At book value without adjustment (minimal or
no charge or adjustment): $ 6,538 23.9%
Not subject to discretionary withdrawal 20,820 76.1%
----------------------------------------------------------------------------
Total, gross 27,358 100.0%
Reinsurance ceded 27,358 100.0%
----------------------------------------------------------------------------
Total, net $ -
----------------------------------------------------------------
----------------------------------------------------------------
</TABLE>
5. RELATED PARTY TRANSACTIONS:
---------------------------
Transactions between the Company and its affiliates relate principally to
tax settlements, rental and service fees, capital contributions and
payments of dividends.
6. FEDERAL INCOME TAXES:
---------------------
The Company and The Hartford have entered into a tax sharing agreement
under which each member in the consolidated U.S. Federal income tax return
will make payments between them such that, with respect to any period, the
amount of taxes to be paid by the Company, subject to certain adjustments,
generally will be determined as though the Company were filing separate
Federal, state and local income tax returns.
As long as The Hartford continues to own at least 80% of the combined
voting power and 80% of the value of the outstanding capital stock of HLI,
the Company will be included for Federal income tax purposes in the
affiliated group of which The Hartford is the common parent. The Hartford
and its non-life subsidiaries filed a single consolidated Federal income
tax return for 1998 and 1997, and intend to file a separate consolidated
Federal income tax return for 1999. The life insurance companies filed a
separate consolidated Federal income tax return for 1998 and 1997, and
intend to file a separate consolidated Federal income tax return for 1999.
Federal income taxes paid by the Company were $213, $34, and $84 in 1999,
1998 and 1997, respectively. The effective tax rate was 12%, 20%, and 39%
in 1999, 1998 and 1997, respectively.
The following schedule provides a reconciliation of the tax provision
(including realized capital gains (losses)) at the U.S. Federal Statutory
rate to Federal income tax expense:
<TABLE>
<CAPTION>
1999 1998 1997
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Tax provision at U.S. Federal Statutory rate $ 162 $ 166 $ 120
Amortization of goodwill (113) (81) --
Investments and Other 8 7 15
- -----------------------------------------------------------------------------------------
Federal income tax expense $ 57 $ 92 $ 135
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
</TABLE>
13
<PAGE>
7. CAPITAL AND SURPLUS AND SHAREHOLDER DIVIDEND RESTRICTIONS:
----------------------------------------------------------
The maximum amount of dividends which can be paid to shareholders by
Connecticut domiciled insurance companies, without prior approval, is
generally restricted to the greater of 10% of surplus as of the preceding
December 31st or the net gain from operations for the previous year.
Dividends are paid as determined by the Board of Directors and are not
cumulative. No dividends were paid in 1999, 1998 or 1997. The amount
available for dividend in 2000 is approximately $797.
8. COMMITMENTS AND CONTINGENT LIABILITIES:
---------------------------------------
The Company is involved in various legal actions, which have arisen in the
normal course of its business. In the opinion of management, the ultimate
liability with respect to such lawsuits, as well as other contingencies, is
not considered to be material in relation to the capital and surplus of the
Company.
Under insurance guaranty fund laws in each state, insurers licensed to do
business can be assessed up to prescribed limits for policyholder losses
incurred by insolvent companies. In the opinion of management, guaranty
fund assessments are not considered to be material in relation to the
capital and surplus of the Company as of December 31, 1999 and 1998.
The Company's Federal income tax returns are routinely audited by the
Internal Revenue Service ("IRS"). The Company's 1997 and 1996 Federal
income tax returns are currently under audit by the IRS. As of March 31,
2000, the audit was in its initial stage and no material issues had been
raised.
14
<PAGE>
PART C
<PAGE>
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) All financial statements are included in Part A and Part B of the
Registration Statement.
(b) (1) Resolution of the Board of Directors of Alpine Life Insurance
Company ("Alpine"), (now known as Hart Life Insurance Company),
authorizing the establishment of the Separate Account.(2)
(2) Not applicable.
(3) (a) Principal Underwriter Agreement.(2)
(3) (b) Form of Dealer Agreement.(2)
(4) Form of Individual Flexible Premium Variable Annuity Contract.(1)
(5) Form of Application.(1)
(6) (a) Certificate of Amendment.
(6) (b) Bylaws of Alpine Life Insurance Company, now known as Hart
Life Insurance Company.(1)
(7) Not applicable.
(8) Form of Fund Participation Agreement.(2)
(9) Opinion and Consent of Lynda Godkin, Senior Vice President,
General Counsel, and Corporate Secretary.
(10) Consent of Arthur Andersen LLP, Independent Public Accountants.
(11) No financial statements are omitted.
(12) Not applicable.
- -----------------------
(1) Incorporated by reference to the initial filing of Registraton Statement
No. 333-65187 filed on October 9, 1998.
(2) Incorporated by reference to the Pre-Effective Amendment No. 1 of the
Registration Statement No. 333-65507 filed on April 12, 1999.
<PAGE>
(13) Not applicable.
(14) Not applicable.
(15) Copy of Power of Attorney.
(16) Organizational Chart.
Item 25. Directors and Officers of the Depositor
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
NAME POSITION WITH HART LIFE INSURANCE
COMPANY (FORMERLY KNOWN AS ALPINE LIFE
INSURANCE COMPANY)
- -------------------------------------------------------------------------------------
<S> <C>
David A. Carlson Vice President
- -------------------------------------------------------------------------------------
Mary Jane B. Fortin Vice President & Chief Accounting Officer
- -------------------------------------------------------------------------------------
David T. Foy Senior Vice President and Treasurer, Director*
- -------------------------------------------------------------------------------------
Lynda Godkin Senior Vice President, General Counsel & Corporate
Secretary, Director*
- -------------------------------------------------------------------------------------
Thomas M. Marra Director*
- -------------------------------------------------------------------------------------
Craig R. Raymond Senior Vice President & Chief Actuary
- -------------------------------------------------------------------------------------
Lowndes A. Smith President & Chief Executive Office, Director*
- -------------------------------------------------------------------------------------
David M. Znamierowski Senior Vice President & Chief Investment Officer,
Director*
- -------------------------------------------------------------------------------------
</TABLE>
Unless otherwise indicated, the principal business address of each of the above
individuals is P.O. Box 2999, Hartford, CT 06104-2999.
*Denotes Board of Directors.
Item 26. Persons Controlled By or Under Common Control with the Depositor or
Registrant
Filed herewith as Exhibit 16.
Item 27. Number of Contract Owners
As of March 31, 2000, there were 0 Contract Owners.
Item 28. Indemnification
<PAGE>
Sections 33-770 to 33-778, inclusive, of the Connecticut General
Statutes ("CGS") provide that a corporation may provide indemnification
of or advance expenses to a director, officer, employee or agent.
Reference is hereby made to Section 33-771(e) of CGS regarding
indemnification of directors and Section 33-776(d) of CGS regarding
indemnification of officers, employees and agents of Connecticut
corporations. These statutes provide, in general, that Connecticut
corporations incorporated prior to January 1, 1997 shall, except to the
extent that their certificate of incorporation expressly provides
otherwise, indemnify their directors, officers, employees and agents
against "liability" (defined as the obligation to pay a judgment,
settlement, penalty, fine, including an excise tax assessed with
respect to an employee benefit plan, or reasonable expenses incurred
with respect to a proceeding) when (1) a determination is made pursuant
to Section 33-775 that the party seeking indemnification has met the
standard of conduct set forth in Section 33-771 or (2) a court has
determined that indemnification is appropriate pursuant to Section
33-774. Under Section 33-775, the determination of and the
authorization for indemnification are made (a) by the disinterested
directors, as defined in Section 33-770(3); (b) by special counsel; (c)
by the shareholders; or (d) in the case of indemnification of an
officer, agent or employee of the corporation, by the general counsel
of the corporation or such other officer(s) as the board of directors
may specify. Also, Section 33-772 provides that a corporation shall
indemnify an individual who was wholly successful on the merits or
otherwise against reasonable expenses incurred by him in connection
with a proceeding to which he was a party because he was a director of
the corporation. In the case of a proceeding by or in the right of the
corporation or with respect to conduct for which the director, officer,
agent or employee was adjudged liable on the basis that he received a
financial benefit to which he was not entitled, indemnification is
limited to reasonable expenses incurred in connection with the
proceeding against the corporation to which the individual was named a
party.
Under the Depositor's bylaws, the Depositor must indemnify both
directors and officers of the Depositor for (1) any claims and
liabilities to which they become subject by reason of being or having
been directors or officers of the Depositor and (2) legal and other
expenses incurred in defending against such claims, in each case, to
the extent such is consistent with statutory provisions.
Section 33-777 of CGS specifically authorizes a corporation to procure
indemnification insurance on behalf of an individual who was a
director, officer, employer or agent of the corporation. Consistent
with the statute, the directors and officers of the Depositor and
Hartford Securities Distribution Company, Inc. ("HSD") are covered
under a directors and
<PAGE>
officers liability insurance policy issued to The Hartford Financial
Services Group, Inc. and its subsidiaries.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or paid
by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE>
Item 29. Principal Underwriters
(a) HSD acts as principal underwriter for the following investment
companies:
Hartford Life Insurance Company - Separate Account One
Hartford Life Insurance Company - Separate Account Two
Hartford Life Insurance Company - Separate Account Two (DC Variable
Account I)
Hartford Life Insurance Company - Separate Account Two (DC Variable
Account II)
Hartford Life Insurance Company - Separate Account Two (QP Variable
Account)
Hartford Life Insurance Company - Separate Account Two (Variable
Account "A")
Hartford Life Insurance Company - Separate Account Two (NQ Variable
Account)
Hartford Life Insurance Company - Putnam Capital Manager Trust
Separate Account
Hartford Life Insurance Company - Separate Account Three
Hartford Life Insurance Company - Separate Account Five
Hartford Life Insurance Company - Separate Account Seven
Hartford Life and Annuity Insurance Company - Separate Account One
Hartford Life and Annuity Insurance Company - Putnam Capital Manager
Trust Separate Account Two
Hartford Life and Annuity Insurance Company - Separate Account Three
Hartford Life and Annuity Insurance Company - Separate Account Five
Hartford Life and Annuity Insurance Company - Separate Account Six
Hartford Life and Annuity Insurance Company - Separate Account Seven
Hart Life Insurance Company - Separate Account One
Hart Life Insurance Company - Separate Account Two
American Maturity Life Insurance Company - Separate Account AMLVA
Servus Life Insurance Company - Separate Account One
Servus Life Insurance Company - Separate Account Two
(b) Directors and Officers of HSD
<TABLE>
<CAPTION>
Name and Principal Positions and Offices
Business Address With Underwriter
------------------ ---------------------
<S> <C>
David A. Carlson Vice President
Peter W. Cummins Senior Vice President
David T. Foy Treasurer
Lynda Godkin Senior Vice President, General Counsel and
Corporate Secretary
George R. Jay Controller
Robert A. Kerzner Executive Vice President
Thomas M. Marra Executive Vice President, Director
Paul E. Olson Supervising Registered Principal
Lowndes A. Smith President and Chief Executive Officer, Director
</TABLE>
<PAGE>
Unless otherwise indicated, the principal business address of
each of the above individuals is P.O. Box 2999, Hartford, CT
06104-2999.
Item 30. Location of Accounts and Records
All of the accounts, books, records or other documents required to
be kept by Section 31(a) of the Investment Company Act of 1940 and
rules thereunder, are maintained by Hartford at 200 Hopmeadow
Street, Simsbury, Connecticut 06089.
Item 31. Management Services
All management contracts are discussed in Part A and Part B of
this Registration Statement.
Item 32. Undertakings
(a) The Registrant hereby undertakes to file a post-effective
amendment to this Registration Statement as frequently as is
necessary to ensure that the audited financial statements in the
Registration Statement are never more than 16 months old so long
as payments under the variable annuity Contracts may be accepted.
(b) The Registrant hereby undertakes to include either (1) as part of
any application to purchase a Contract offered by the Prospectus,
a space that an applicant can check to request a Statement of
Additional Information, or (2) a post card or similar written
communication affixed to or included in the Prospectus that the
applicant can remove to send for a Statement of Additional
Information.
(c) The Registrant hereby undertakes to deliver any Statement of
Additional Information and any financial statements required to
be made available under this Form promptly upon written or oral
request.
(d) Hart Life Insurance Company hereby represents that the aggregate
fees and charges under the Contract are reasonable in relation to
the services rendered, the expenses expected to be incurred, and
the risks assumed by Hart Life Insurance Company.
The Registrant is relying on the no-action letter issued by the
Division of Investment Management to American Counsel of Life
Insurance, Ref. No. IP-6-88, November 28, 1988. The Registrant has
complied with conditions one through four of the no-action letter.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant certifies that it meets the requirements of Securities Act
Rule 485 for effectiveness of this Registration Statement and has caused this
Registration Statement to be signed on its behalf, in the City of Hartford, and
State of Connecticut on this 13th day of April, 2000.
SEPARATE ACCOUNT ONE
(Registrant)
*By: Thomas M. Marra* *By: /s/ Thomas S. Clark
------------------------------------ ------------------------
Thomas M. Marra, Director Thomas S. Clark
Attorney-in-fact
HART LIFE INSURANCE COMPANY
(Depositor)
*By: Thomas M. Marra*
------------------------------------
Thomas M. Marra, Director
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed below by the following persons and in the
capacity and on the date indicated.
David T. Foy, Senior Vice President and
Treasurer, Director*
Lynda Godkin, Senior Vice President, General *By: /s/ Thomas S. Clark
Counsel and Corporate Secretary, Director* ------------------------
Thomas M. Marra, Director* Thomas S. Clark
Lowndes A. Smith, President and Chief Attorney-in-fact
Executive Officer, Director *
David M. Znamierowski, Senior Vice President and Date: April 13, 2000
Chief Investment Officer, Director*
<PAGE>
EXHIBIT INDEX
(6)(a) Certificate of Amendment.
(9) Opinion and Consent of Lynda Godkin, Senior Vice President, General
Counsel and Corporate Secretary.
(10) Consent of Arthur Andersen LLP, Independent Public Accountants.
(15) Copy of Power of Attorney.
(16) Organizational Chart.
<PAGE>
CERTIFICATE OF AMENDMENT
STOCK CORPORATION
OFFICE OF THE SECRETARY OF THE STATE
30 TRINITY STREET/P.O. BOX 150470/HARTFORD, CT 06115-0470/NEW/1-97
- -------------------------------------------------------------------------------
SPACE FOR OFFICE USE ONLY
FILING #0002055684 PG 01 OF 05 VOL B-00308
FILED 12/22/1999 10:05 AM PAGE 02979
SECRETARY OF THE STATE
CONNECTICUT SECRETARY OF THE STATE
- -------------------------------------------------------------------------------
1. NAME OF CORPORATION:
Alpine Life Insurance Comapny
- -------------------------------------------------------------------------------
2. THE CERTIFICATE OF INCORPORATION IS (CHECK A., B. OR C.):
X A. AMENDED.
- ----
B. AMENDED AND RESTATED.
- ----
C. RESTATED.
- ----
- -------------------------------------------------------------------------------
3. TEXT OF EACH AMENDMENT/RESTATEMENT:
The Amended and Restated Certificate of Incorporation is amended by the
following resolution recommended by the Board of Directors on
December 14, 1999 and adopted by the Sole Shareholder on
December 14, 1999:
RESOLVED, that the Amended and Restated Certificate of Incorporation
of the Company be amended by changing the name of the Company in
each place that such name therein appears, such that the new name of
the Company shall be
HART LIFE INSURANCE COMPANY
such change to become effective as soon as is practicable. All other
sections of the Amended and Restated Certificate of Incorporation
shall remain unchanged and continue in full force and effect.
(PLEASE REFERENCE AN 8 1/2 X 11 ATTACHMENT IF ADDITIONAL SPACE IS NEEDED)
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SPACE FOR OFFICE USE ONLY
FILING #0002055684 PG 02 OF 05 VOL B-00308
FILED 12/22/1999 10:05 AM PAGE 02980
SECRETARY OF THE STATE
CONNECTICUT SECRETARY OF THE STATE
- -------------------------------------------------------------------------------
4. VOTE INFORMATION (CHECK A., B. OR C.)
X A. THE RESOLUTION WAS APPROVED BY SHAREHOLDERS AS FOLLOWS:
- ---- (SET FORTH ALL VOTING INFORMATION REQUIRED BY CONN. GEN. STAT.
SECTION 33-800 AS AMENDED IN THE SPACE PROVIDED BELOW)
The number of outstanding shares of the Corporation's common capital
stock entitled to vote thereon was 10,000. The vote favoring
adoption was 10,000 shares, which was sufficient for approval of the
resolution.
- -------------------------------------------------------------------------------
B. THE AMENDMENT WAS ADOPTED BY THE BOARD OF DIRECTORS WITHOUT
- ---- SHAREHOLDER ACTION. NO SHAREHOLDER VOTE WAS REQUIRED FOR ADOPTION.
C. THE AMENDMENT WAS ADOPTED BY THE INCORPORATORS WITHOUT SHAREHOLDER
- ---- ACTION. NO SHAREHOLDER VOTE WAS REQUIRED FOR ADOPTION.
- -------------------------------------------------------------------------------
5. EXECUTION
- -------------------------------------------------------------------------------
Dated this 14th day of December, 1999
- -------------------------------------------------------------------------------
Thomas A. Klee Assistant Corporate Secretary /s/ Thomas A. Klee
---------------- ----------------------------- -------------------
PRINT OR TYPE NAME OF CAPACITY OF SIGNATORY SIGNATURE
SIGNATORY
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
FILING #0002055684 PG 03 OF 05 VOL B-00308
FILED 12/22/1999 10:05 AM PAGE 02981
SECRETARY OF THE STATE
CONNECTICUT SECRETARY OF THE STATE
ALPINE LIFE INSURANCE COMPANY
UNANIMOUS WRITTEN CONSENT
OF THE
SOLE SHAREHOLDER
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY, being the sole shareholder of
ALPINE LIFE INSURANCE COMPANY, (the "Company") hereby consents in accordance
with Section 33-698 of the Connecticut Business Corporation Act, through the
undersigned officer, to the following resolutions, such action to have the
same force and effect as if taken at a meeting of the Shareholders of the
Company duly called and held for such purpose:
CHANGE OF CORPORATE NAME
- ------------------------
WHEREAS, the undersigned sole shareholder deems it in the best interest
of the Company to change the Company's name by amending the Amended and
Restated Certificate of Incorporation; and
WHEREAS, the Board of Directors of the Company has adopted resolutions
recommending such amendment;
NOW, THEREFORE, BE IT
RESOLVED, that the Amended and Restated Certificate of Incorporation
of the Company be amended by changing the name of the Company in each
place that such name therein appears, such that the new name of the
Company shall be
HART LIFE INSURANCE COMPANY
such change to become effective as soon as is practicable. All other
sections of the Amended and Restated Certificate of Incorporation shall
remain unchanged and continue in full force and effect; and be it further
RESOLVED, that the Board of Directors and officers of the Company are,
and each of the officers acting singly is, authorized and directed to
prepare and file the Certificate of Amendment and to do all acts and
things and to sign, seal, execute, acknowledge, certify, file, deliver
and record all papers, instruments, documents, agreements and
certificates, and to pay all charges, fees, taxes and other expenses, as
they or any of them may determine from time to time to be necessary or
appropriate in order to effectuate the purposes of the foregoing
resolution in each jurisdiction in which the Company is authorized,
qualified or licensed to do business.
<PAGE>
FILING #0002055684 PG 04 OF 05 VOL B-00308
FILED 12/22/1999 10:05 AM PAGE 02982
SECRETARY OF THE STATE
CONNECTICUT SECRETARY OF THE STATE
IN WITNESS WHEREOF, the undersigned has executed this Consent as of the 14th
day of December, 1999, the effective date of this action.
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY
By: /s/ Lowndes A. Smith
--------------------------------------------
Name: Lowndes A. Smith
Title: President and Chief Executive Officer
<PAGE>
[LOGO] STATE OF CONNECTICUT
INSURANCE DEPARTMENT
FILING #0002055684 PG 05 OF 05 VOL B-00308
FILED 12/22/1999 10:05 AM PAGE 02983
SECRETARY OF THE STATE
CONNECTICUT SECRETARY OF THE STATE
THIS IS TO CERTIFY, THAT THE CERTIFICATE OF AMENDMENT TO THE CERTIFICATE
OF INCORPORATION OF ALPINE LIFE INSURANCE COMPANY, WITH RESPECT TO THE CHANGE
OF NAME TO HART LIFE INSURANCE COMPANY, HAS BEEN REVIEWED AND APPROVED.
WITNESS MY HAND AND OFFICIAL SEAL, AT HARTFORD,
THIS 21ST DAY OF DECEMBER, 1999
/s/ George M. Reider
----------------------
Insurance Commissioner
<PAGE>
[LOGO]
[COMPANY]
April 13, 2000
LYNDA GODKIN
Senior Vice President, General
Counsel & Corporate Secretary
Board of Directors
Hart Life Insurance Company
200 Hopmeadow Street
Simsbury, CT 06089
RE: SEPARATE ACCOUNT ONE ("SEPARATE ACCOUNT")
HART LIFE INSURANCE COMPANY ("COMPANY")
FILE NO. 333-65507
Dear Sir/Madam:
I have acted as General Counsel to Hart Life Insurance Company (the "Company"),
a Connecticut insurance company, and Hart Life Insurance Company Separate
Account One (the "Account") in Connecticut with the registration of an
indefinite amount of securities in the form of flexible premium variable annuity
insurance contracts (the "Contracts") with the Securities and Exchange
Commission under the Securities Act of 1933, as amended. I have examined such
documents (including the Form N-4 Registration Statement) and reviewed such
questions of law as I considered necessary and appropriate, and on the basis of
such examination and review, it is my opinion that:
1. The Company is a corporation duly organized and validly existing as a stock
life insurance company under the laws of the State of Connecticut and is
duly authorized by the Insurance Department of the State of Connecticut
to issue the Contracts.
2. The Account is a duly authorized and existing separate account established
pursuant to the provisions of Section 38a-433 of the Connecticut Statutes.
3. To the extent so provided under the Contracts, that portion of the assets
of the Account equal to the reserves and other contract liabilities with
respect to the Account will not be chargeable with liabilities arising out
of any other business that the Company may conduct.
4. The Contracts, when issued as contemplated by the Form N-4 registration
statement, will constitute legal, validly issued and binding obligations of
the Company.
I hereby consent to the filing of this opinion as an exhibit to the Form N-4
Registration Statement for the Contracts and the Account.
Sincerely,
/s/ Lynda Godkin
Lynda Godkin
<PAGE>
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
As independent public accountants, we hereby consent to the use of our report
(and to all references to our Firm) included in or made a part of this
Registration Statement File No. 333-65507 for Hart Life Insurance Company
Separate Account One on Form N-4.
/s/ Arthur Andersen LLP
Hartford, Connecticut
April 11, 2000
<PAGE>
HART LIFE INSURANCE COMPANY
POWER OF ATTORNEY
David T. Foy
Mary Jane B. Fortin
Lynda Godkin
Thomas M. Marra
Lowndes A. Smith
David M. Znamierowski
do hereby jointly and severally authorize Lynda Godkin, Christine Repasy,
Marianne O'Doherty, Thomas S. Clark and Marta Czekajewski to sign as their agent
any Registration Statement, pre-effective amendment, post-effective amendment
and any application for exemptive relief of the Hart Life Insurance Company
under the Securities Act of 1933 and/or the Investment Company Act of 1940, and
do hereby ratify such signatures heretofore made by such persons.
IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney for the
purpose herein set forth.
/s/ David T. Foy
- -------------------------------- Dated as of January 15, 2000
David T. Foy
/s/ Mary Jane B. Fortin
- -------------------------------- Dated as of January 15, 2000
Mary Jane B. Fortin
/s/ Lynda Godkin
- -------------------------------- Dated as of January 15, 2000
Lynda Godkin
/s/ Thomas M. Marra
- -------------------------------- Dated as of January 15, 2000
Thomas M. Marra
/s/ Lowndes A. Smith
- -------------------------------- Dated as of January 15, 2000
Lowndes A. Smith
/s/ David M. Znamierowski
- -------------------------------- Dated as of January 15, 2000
David M. Znamierowski
<PAGE>
ORGANIZATIONAL CHART
<TABLE>
<CAPTION>
<S> <C>
THE HARTFORD FINANCIAL SERVICES GROUP, INC.
(DELAWARE)
|
---------------------------------------------
NUTMEG INSURANCE COMPANY |
(CONNECTICUT) THE HARTFORD INVESTMENT
| MANAGEMENT COMPANY
HARTFORD FIRE INSURANCE COMPANY (DELAWARE)
(CONNECTICUT) |
| |
HARTFORD ACCIDENT AND INDEMNITY COMPANY HARTFORD INVESTMENT
(CONNECTICUT) SERVICES, INC.
| (CONNECTICUT)
HARTFORD LIFE, INC.
(DELAWARE)
|
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY
(CONNECTICUT)
|
|
|
-------------------------------------------------------------------------------------------------------------------------
| | | | | | | | |
HARTFORD LIFE | | | | | | PLANCO PLANCO
INTERNATIONAL, LTD.| | | | | | FINANCIAL INCORPORATED
(CONNECTICUT) | | | | | | SERVICES, (PENNSYLVANIA)
| | | | | | INCORPORATED
| | | | | | (PENNSYLVANIA)
| | | | | |
| HART LIFE HARTFORD FINANCIAL HARTFORD LIFE HARTFORD AMERICAN
| INSURANCE SERVICES LIFE INSURANCE COMPANY FINANCIAL MATURITY LIFE
| COMPANY INSURANCE COMPANY (CONNECTICUT) SERVICES, LLC INSURANCE COMPANY
| (CONNECTICUT) (CONNECTICUT) | (DELAWARE) (CONNECTICUT)
| | | |
| ------------------------------------- | AML FINANCIAL, INC.
| | | | | (CONNECTICUT)
|SERVUS LIFE HARTFORD HARTFORD |
| INSURANCE INTERNATIONAL LIFE AND |
| COMPANY LIFE REASSURANCE ANNUITY INSURANCE |
|(CONNECTICUT) CORPORATION COMPANY |
| (CONNECTICUT) (CONNECTICUT) |
| | |
| | |
| HARTFORD |
| LIFE, LTD. |
| (BERMUDA) |
| |
| |
----------| -----------------------------------------------------------------------
| | | | |
INTERNATIONAL HL INVESTMENT HARTFORD HARTFORD SECURITIES HARTFORD-COMPREHENSIVE
CORPORATE ADVISORS, LLC EQUITY SALES DISTRIBUTION EMPLOYEE
MARKETING GROUP, INC. (CONNECTICUT) COMPANY, INC. COMPANY, INC. BENEFIT SERVICE
(CONNECTICUT) | (CONNECTICUT) (CONNECTICUT) COMPANY
| | (CONNECTICUT)
| |
THE EVERGREEN HARTFORD INVESTMENT
GROUP, INC. FINANCIAL SERVICES
(NEW YORK) COMPANY
(DELAWARE)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
THE HARTFORD FINANCIAL SERVICES GROUP, INC.
(DELAWARE)
|
NUTMEG INSURANCE COMPANY
(CONNECTICUT)
|
HARTFORD FIRE INSURANCE COMPANY
(CONNECTICUT)
|
----------------------------------------------------------------------------------------------------------------------------
| | |
| | Hartford Accidental and Indemnity Company
| | (Connecticut)
| | |
| | Hartford Life, Inc
| | (Delaware)
| | |
| | Hartford Life and Accident Insurance Company
| | (Connecticut)
| | |
| | HARTFORD LIFE
| | -------INTERNATIONAL LTD.
| | | (CONNECTICUT)
| | | |
| | | ITT HARTFORD
| | | ----SUDAMERICANA
| | | | HOLDING S.A.
| | | | (ARGENTINA)
| | | |------------------------------------------------------
| | | | | |
| | | | ITT HARTFORD GALICIA INSTITUTO DE
| | | | SEGUROS VIDA COMPANIA SALTA COMPANIA DE
| | | |------DE VIDA S.A. DE SEGUROS S.A. SEGUROS DE VIDA S.A.
| | | | (URUGUAY) (ARGENTINA) (ARGENTINA)
| | | |
| | ICATU | | HARTFORD
| | HARTFORD | |---SEGUROS DE VIDA S.A.
| | SEGUROS S.A.----------| | (ARGENTINA)
| | (BRAZIL) |
| | | |
| | | | HARTFORD
| | -- ----------| |-------SEGUROS DE
| | | | | RETIRO S.A.
| | | | | (ARGENTINA)
|-----------|----------------|-------------------|--------------------------------------------------------------------------
| | | | |
| | | ICATU HARTFORD | CONSULTORA DE CAPITALES
| | | FUNDO DE PENSAO | S.A. SOCIEDAD GERENTE
| | | (BRAZIL) |----DE FONDOS COMUNES
| | | | | DE ENVERSION
| | | | | (ARGENTINA)
| | | ICATU HARTFORD |
| | | CAPITALIZACAO S.A. | CLARIDAD
| | | (BRAZIL) | ADMINISTRADORA DE
| | | | |---FONDOS DE JUBILACIONES
| | | BRAZILCAP | Y PENSIONES S.A.
| | | CAPITALIZACAO S.A. | (ARGENTINA)
| | | (BRAZIL) |
| | | |
| | -------------------------- |
| |--------------- | |
| | | |
HARTFORD FIRE HARTFORD FIRE | |------- SEGPOOL S.A.
INTERNATIONAL------------INTERNATIONAL, LTD. | | (ARGENTINA)
(GERMANY) GMBH (CONNECTICUT) | |
(WEST GERMANY) | |
| |
ICATU HARTFORD | | THESIS S.A.
ADMINISTRACAO | |-------- (ARGENTINA)
DE BENEFICIOS LTDA-- | |
(BRAZIL) |
|
|
|
|--------- U.O.R., S.A.
(ARGENTINA)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
THE HARTFORD FINANCIAL SERVICES GROUP, INC.
(DELAWARE)
|
NUTMEG INSURANCE COMPANY
(CONNECTICUT)
|
HARTFORD FIRE INSURANCE COMPANY
(CONNECTICUT)
|
- --------------------------------------------------------------------------------------------------------------------------------|
| |
THE HARTFORD INTERNATIONAL |
|-----------------------------------------------------------------------FINANCIAL SERVICES GROUP, INC. |
| | | (DELAWARE) |
| | | ----------------------|----------------- |
| | | | | | | |
ZWOLSCHE | | ITT HARTFORD LONDON AND | HARTFORD |
ALGEMEENE N.V. | | INTERNATIONAL, LTD. EDINBURGH | EUROPE, INC. |
(NETHERLANDS) | | (U.K.) INSURANCE GROUP, LTD.| (DELAWARE) |
| | | (U.K.) | |
| | | | | |
| | | ------------- | |
| | | | | |
| ITT ASSURANCES HARTFORD INTERNATIONAL | LONDON AND -THE HARTFORD |
| S.A. INSURANCE CO., N.V. |--- EDINBURGH INTERNATIONAL |
| ZWOLSCHE ALGEMEENE (FRANCE) (BELGIUM) | INSURANCE CO., LTD. FINANCIAL |
|----SCHADEVERZEKERING | | (U.K.) SERVICES |
--------| N.V.----------------------------------- | | | GROUP CIA |
| | (NETHERLANDS) | | | | DE SEGUROS Y |
Z.A. | | | | EXCESS INSURANCE REASEGUROS S.A.|
- --VERZEKERINGEN | | | | COMPANY LTD. (SPAIN) |
| N.V. | ZWOLSCHE ALGEMEENE | | | (U.K.) |
| (BELGIUM) |------HERVERZEKERING B.V. | | | |
| | -----| (NETHERLANDS) | | | LONDON AND |
| | | | | | |--- EDINBURGH LIFE |
| Z.A. LUX S.A. | | | | ASSURANCE CO., LTD. |
| (LUXEMBURG) | ZWOLSCHE ALGEMEENE | | | (U.K.) |
| |--LEVENS-VERZEKERING N.V.------------ | | | |
| | (NETHERLANDS) | | | | |
- ----------------|------------------------------------|------------|------|--------------|---------------------------------------|
| | | | | | |
| -------- | | | | |
| | | | | | | |
| ZWOLSCHE | ZWOLSCHE ALGEMEENE ZWOLSCHE ALGEMEENE | | | |
| ALGEMEENE |-----HYPOTHEKEN N.V. BELEGGINGEN III B.V. | | | |
| EUROPA B.V. | (NETHERLANDS) (NETHERLANDS) | | | |
| (NETHERLANDS) | ---------- | | |
- --------| | | | | |
| EXPLOITATIEMAAT- BELEGGINGSMAAT- | | |
|----- SCHAPPIJ SCHAPPIJ | | |
| BUIZERDLAAN B.V. BUIZERDLAAN B.V. | | |
| (NETHERLANDS) (NETHERLANDS) | | |
| | | |
| | | -----
| HOLLAND | |-------------------------- |
|---- BELEGGINGSGROEP B.V. | | | |
(NETHERLANDS) | |----------------- | |
| -------| | | |
| | | | | |
| | | | | |
F.A. KNIGHT | MACALISTER & LONDON AND | HARTFORD FIRE
& SON N.V. | DUNDAS, LTD. EDINBURGH | INTERNATIONAL
(BELGIUM) | (SCOTLAND) TRUSTEES, LTD. | SERVICIOS
| (U.K.) | (SPAIN)
------------------------- -----------
| | |
FENCOURT QUOTEL LONDON AND
PRINTERS, LTD. INSURANCE EDINBURGH
(U.K.) SYSTEMS, LTD. SERVICES, LTD.
(U.K.) (U.K.)
|
EUROSURE
INSURANCE
MARKETING, LTD.
(U.K.)
</TABLE>
