<PAGE>
As filed with the Securities and Exchange Commission on March 31, 2000
Registration No. 333-83625
Pre-Effective Amendment No. 1 to
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
(Exact Name of Registrant)
GENERAL AMERICAN LIFE INSURANCE COMPANY
700 Market Street, St. Louis, Missouri 63101
(Name and Address of Principal Executive Office of Depositor)
Christopher A. Martin, Esquire
GenAmerica Management Company
700 Market Street, St. Louis, Missouri 63101
(Name and Address of Agent for Service of Process)
Copy to:
Stephen E. Roth, Esquire
Sutherland, Asbill & Brennan
1275 Pennsylvania Ave., N.W.
Washington, DC 20004-2404
Title of Securities Being Registered: The variable portion of flexible
--------------------------------
premium variable life insurance contracts called Destiny Variable Universal
- ---------------------------------------------------------------------------
Life Insurance.
- --------------
Approximate Date of Proposed Public Offering: As soon as practical after
--------------------------
the effective date of this Registration Statement.
- -------------------------------------------------
The Registrant intends to amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall become effective in accordance with Section
8(a) of the Securities Act of 1933 or on such date as the Commission,
acting pursuant to said Section 8(a), may determine that the Registration
Statement shall become effective.
<PAGE>
<PAGE>
VARIABLE LIFE INSURANCE POLICY
ISSUED BY
GENERAL AMERICAN LIFE INSURANCE COMPANY
700 MARKET STREET
ST. LOUIS, MO 63101
(314) 231-1700
This Prospectus describes an individual variable life insurance Policy
("the Policy") offered by General American Life Insurance Company ("we,"
"our," "us," "General American" or "the Company"). The Policy is
designed to provide lifetime insurance protection in an amount
determined in part by the investment performance of the underlying
funds. You have the opportunity to allocate Net Premiums among several
investment portfolios with different investment objectives.
The Policy provides:
(1) a Cash Surrender Value that can be obtained by surrendering the
Policy;
(2) Policy Loans; and
(3) a death benefit payable at the Insured's death.
As long as a Policy remains in force before the Insured's Attained Age
100, the death benefit will be determined by the Insured's Attained Age
and by the Cash Value of the Policy. If the Policy is in effect after
the Insured reaches Attained Age 100, the death benefit is 101% of the
Cash Value (100% if required by state law). A Policy will remain in
force as long as its Cash Surrender Value is sufficient to pay the
monthly charges.
You may allocate the Net Premiums to one or more of the Divisions of
General American Separate Account Eleven ("the Separate Account") or to
General American's General Account.
You will find a list of the Funds in the Separate Account, the fund
managers, and the investment objectives in the Summary on page 12. Note
that investment results in the Separate Account are not guaranteed --
you may either make money or lose money. The amount of the death
benefit will vary depending on investment results.
The Prospectus of each Fund contains a full description of the Fund,
including the investment policies, restrictions, risks, and charges.
You should receive a Prospectus for each Fund along with this Prospectus
for the Policy.
You may also invest all or part of your cash value in the General
Account, which guarantees at least 4% interest.
It may not be advantageous to purchase a Policy as a replacement for
another type of life insurance or as a means to obtain additional
insurance protection if you already own another variable life insurance
policy.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Please read this Prospectus carefully and keep it for future reference.
The date of this Prospectus is March 20, 2000. The Policies are not
available in all states.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN
WHICH SUCH OFFERING MAY NOT BE LAWFULLY MADE. NO DEALER, SALESMAN, OR
OTHER PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE
CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON.
<PAGE>
<PAGE>
<TABLE>
TABLE OF CONTENTS
<CAPTION>
Page
<S> <C>
Summary 1
Definitions 11
The Company and the Separate Account 12
The Company
The Separate Account
General American Capital Company
American Century Variable Portfolios
J.P. Morgan Series Trust II
Variable Insurance Products Fund
Variable Insurance Products Fund II
Van Eck Worldwide Insurance Trust
Addition, Deletion, or Substitution of Investments 16
Policy Benefits 16
Death Benefit
Cash Value
Policy Rights 18
Loans
Surrender and Pro Rata Surrender
Transfers
Right to Examine Policy
Payment and Allocation of Premiums 21
Issuance of a Policy
Premiums
Allocation of Net Premiums and Cash Value
Premium Default and Reinstatement
Charges and Deductions 23
Premium Expense Charges
Monthly Deduction
Separate Account Charges
Summary of Fees
The General Account 25
General Matters 27
Distribution of the Policies 29
Federal Tax Matters 29
Unisex Requirements Under Montana Law 32
Safekeeping of the Separate Account's Assets 32
Voting Rights 32
State Regulation of the Company 33
Management of the Company 34
Legal Matters 37
Legal Proceedings 37
Experts 37
Additional Information 37
Financial Statements 37
</TABLE>
<PAGE>
<PAGE>
SUMMARY
THROUGHOUT THIS SUMMARY, THE TERMS "YOU" AND "YOUR" REFER TO THE OWNER
OF THE POLICY. THE OWNER MAY OR MAY NOT BE THE PERSON INSURED UNDER THE
POLICY. THE TERMS "WE," "US," AND "OUR" REFER TO GENERAL AMERICAN LIFE
INSURANCE COMPANY.
THE INFORMATION IN THIS SECTION IS JUST A SUMMARY, WRITTEN IN "LAYMEN'S
TERMS" TO HELP YOU UNDERSTAND THE POLICY. HOWEVER, BOTH YOUR POLICY AND
THIS PROSPECTUS ARE LEGAL DOCUMENTS. IF YOU HAVE QUESTIONS ABOUT THEM,
YOU SHOULD CONTACT YOUR AGENT OR OTHER COMPETENT PROFESSIONAL ADVISERS.
IN PREPARING THIS SUMMARY, WE ASSUME THAT THE POLICY IS IN FORCE, AND
THAT YOU HAVE NOT BORROWED ANY OF THE CASH VALUE.
THE POLICY. You are purchasing a life insurance policy. Like many life
insurance policies, it has both a death benefit and a cash value. The
death benefit is the amount of money that we will pay to the beneficiary
if the person insured under the policy dies while the policy is in
force. The cash value is the amount of money accumulated in your policy
as an investment at any time. The cash value consists of the premiums
you have paid, reduced by the expenses deducted for operation of the
policy, and either increased or decreased by investment results.
You have certain rights, including the right to borrow money from the
policy's cash value and the right to select the funds in which you will
invest your premiums.
You have the right to review the policy and decide whether you want to
keep it. If you decide not to keep the policy, you may return it to us
or to your agent during the "Right to Examine Policy Period." This
period is sometimes referred to as the "Free Look Period." It normally
ends on the later of:
1. twenty days after you receive the policy or
2. forty-five days after you signed the application.
In some states the period may be longer. Your agent can tell you if
this is the case.
Where permitted by law, if you return the policy before the end of the
free look period, we will cancel the policy and return:
1. the difference between the premiums you paid and the net
premiums allocated to the Separate Account; plus
2. the cash value of the separate account; plus
3. any charges deducted from the cash value in the divisions of
the separate account.
During the "Right to Examine Policy Period" we invest your net premiums
in the divisions of the Separate Account that you have selected.
When the "Right to Examine Policy Period" ends, we will continue to
transfer future net premiums into the investments that you select as
soon as we receive the premiums.
Where we are required by law to return your full premium if you decide
not to take the policy, we will initially hold your net premiums in the
division of the Separate Account that invests in the money market fund.
If you return the policy before the end of the free look period, we will
cancel the policy and return the premium you paid. When the "Right to
Examine Policy Period" ends, we will transfer your cash value from the
money market fund to the divisions of the Separate Account that you have
selected. We will transfer future net premiums into the investments
that you have selected as soon as we receive the premiums.
PREMIUMS. When you apply for the policy, you determine the amount of
the premium that you plan to pay each year. The first year's premium
payment must be at least $20,000. The scheduled premium for future
years does not have to be level - it may be different from year to year
to meet your anticipated needs.
After you pay the initial premium, you make future premium payments
according to the schedule that you established. The scheduled premiums
are shown on the policy specifications page. We will send you a bill
based on your schedule. You may make each year's scheduled premium
payment in a lump sum or in installments at any time during the policy
year.
You may not pay more premiums than the amount billed. You may pay less
than the scheduled premium, but there are some important restrictions as
described below.
<PAGE>
On each Policy Anniversary we will review the premiums paid into the
policy. If the total amount of premiums paid since the policy's issue
date has always been at least 80% of the total scheduled premiums since
the policy's issue date, then you may pay any amount of premium up to
the current scheduled amount for that Policy Year. If the total amount
of the premiums paid is less than 80% of the total scheduled premium, we
will notify you of the amount of the shortfall and the consequences of
failing to pay at least 80% of the scheduled premium.
There is a period of 62 days from the end of the policy year, called the
"grace period." If you pay a
1
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<PAGE>
premium during the grace period, and if you have paid less than the
scheduled premium (or less than the restricted premium, if applicable)
for the policy year that just ended, then we will treat the premium
payment as having been made in the prior policy year. By doing this, we
allow you greater flexibility in deciding how much premium you want to
pay in the current policy year. If the sum of the premium paid during
the grace period and the premium already applied to the prior policy
year exceed the amount allowed for the prior policy year, then we will
treat any excess as a premium payment for the current policy year.
If, on the other hand, a premium remains unpaid after the grace period,
and if the total premium you have paid since the policy's issue date is
less than 80% of the scheduled premiums, then future annual premiums
payable are limited to the lesser of:
1. the scheduled annual premium, or
2. the annual premium paid in the year in which the cumulative
premiums paid fell below 80% of the scheduled cumulative
premium.
If you do not pay the lesser of these two amounts, no further premiums
are payable. We will not accept any more premiums unless they are
necessary to pay the charges and deductions under your policy.
This limit will remain in force for all future years unless you
reinstate the premium schedule as described under Premium Default and
Reinstatement.
We will deduct certain expenses from your cash value. These expenses
are described below. In addition, your cash value may increase or
decrease, depending on the investment experience of the funds you
select. Because it is possible for your cash value to decrease, your
death benefit may also decrease. If your cash value is insufficient to
pay the charges and deductions, we will allow you to pay sufficient
premium into the policy to cover the current charges and deductions. If
you do not make such premium payments, the policy will terminate without
value.
INVESTING YOUR CASH VALUE. You may tell us to invest your cash value in
either the general account or the separate account, or you may split
your cash value between them. If you split your cash value into more
than one account, each allocation must be a whole percentage.
THE GENERAL ACCOUNT. The general account is an interest-bearing
account. Money in the general account is guaranteed to earn at least 4%
interest, and it may earn more. General American determines the current
interest rate from time to time, and we will notify you in advance of
any changes. We have the right to limit the amount of money that you
may put into the general account.
THE SEPARATE ACCOUNT. The separate account consists of divisions, which
represent different types of investments. Each division may either make
money or lose money. Therefore if you invest in a division of the
separate account, you may either make money or lose money, depending on
the investment experience of that division. There is no guaranteed rate
of return in the separate account.
There are multiple divisions, or investment options, in the separate
account, although some divisions might not be available under the
Policy. These divisions represent funds run by various investment
companies. The investment companies hire advisers to operate or advise
on the day-to-day operation of the funds.
The following list shows the investment companies whose funds are
available under the policy, along with the managers or advisers and the
divisions that they oversee:
<TABLE>
<CAPTION>
INVESTMENT COMPANY INVESTMENT MANAGER/ADVISER
<S> <C>
General American Capital Company Conning Asset Management Company
American Century Variable Portfolios American Century Investment Management, Inc.
J.P. Morgan Series Trust II J.P. Morgan Investment Management, Inc.
Fidelity Investments Variable Insurance Fidelity Management & Research Company
Products Fund
Fidelity Investments Variable Insurance Fidelity Management & Research Company
Products Fund II
Van Eck Worldwide Insurance Trust Van Eck Associates Corporation
</TABLE>
<PAGE>
These funds have different investment goals and strategies, which we
have summarized in the following table. You should review the
prospectus of each fund, or seek professional guidance in determining
which fund(s) best meet your objectives.
2
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT FUND INVESTMENT OBJECTIVE
---------- ---- ---------- ---------
MANAGER NAME TYPE
------- ---- ----
<S> <C> <C> <C>
Conning S&P 500 Index Growth & Income To achieve a rate of return that parallels
Asset Management Fund the return of the stock market as a whole,
Company as represented by the Standard and Poor's
500 Stock Index.
Conning Money Market Money Market To obtain the highest level of current
Asset Management Fund income consistent with the preservation of
Company capital and maintenance of liquidity.
Conning To provide a rate of return that reflects
Asset Management Bond Index Fund Corporate Bonds the performance of the bond market as a
Company whole, as measured by the Lehman Brothers
Government/Corporate Bond Index.
Conning Asset Allocation To obtain a high rate of long-term return,
Asset Management Fund Balanced composed of capital growth and income.
Company
Conning Managed Equity To obtain long-term capital growth
Asset Management Fund Growth through investment in common stocks.
Company
Conning International Index Growth: To obtain investment results that parallel
Asset Management Fund International Stock the price and yield performance of
Company publicly-traded common stocks in the
Morgan Stanley Capital International,
Europe, Australia, and Far East Index
("EAFE Index").
Conning Mid-Cap Equity To obtain long-term capital appreciation
Asset Management Fund Growth through investment primarily in common
Company stocks of U.S.-based, publicly traded
companies with medium market
capitalization, defined as within the range
of the S&P Mid-Cap 400 at the time of
the Fund's investment.
Conning Small-Cap Equity To provide a high rate of return through
Asset Management Fund Aggressive Growth investment in the common stock of small
Company companies, making up, at one time, the
smallest 20% of U.S.-based companies on
the New York Stock Exchange.
Fidelity Management & Growth Portfolio Growth To seek capital appreciation, normally
Research Company through purchases of common stocks,
although its investments are not restricted
to any one type of security.
Fidelity Management & Equity-Income Growth & Income To seek reasonable income by investing
Research Company Portfolio primarily in income-producing equity
securities.
Fidelity Management & Overseas Portfolio Growth: To seek long-term growth of capital
Research Company International Stock primarily through investment in foreign
securities.
Fidelity Management & Asset Manager Balanced To seek a high total return with reduced
Research Company Portfolio risk over the long-term by allocating its
assets among domestic and foreign stocks,
bonds, and short-term fixed income
instruments.
Fidelity Management & High Income High Yield Bond To seek a high level of current income by
Research Company Portfolio investing primarily in high yielding,
lower-rated, fixed income securities,
while also considering growth of capital.
3
<PAGE>
<PAGE>
<CAPTION>
INVESTMENT FUND INVESTMENT OBJECTIVE
---------- ---- ---------- ---------
MANAGER NAME TYPE
------- ---- ----
<S> <C> <C> <C>
Van Eck Associates Worldwide Hard Aggressive Growth: To seek long-term capital appreciation by
Corporation Assets Fund Specialty investing in equity and debt securities of
companies engaged in the exploration,
development, production, and distribution
of gold and other natural resources such
as strategic and other metals, minerals,
forest products, oil, natural gas, and coal.
Van Eck Associates Worldwide Aggressive Growth: To obtain long-term capital appreciation
Corporation Emerging Markets International Stock by investing in equity securities in
Fund emerging markets around the world. The
Fund emphasizes primarily investment in
countries that, compared to the world's
major economies, exhibit relatively low
gross national product per capita, as well
as the potential for rapid economic
growth.
J.P. Morgan Investment Bond Portfolio Growth & Income To provide a high total return consistent
Management, Inc. with moderate risk of capital and
maintenance of liquidity.
J.P. Morgan Investment Small Company Aggressive Growth To provide high total return from a
Management, Inc. Portfolio portfolio of equity securities of small
companies. The Fund invests at least
65% of the value of its total assets in the
common stock of small U.S. companies
primarily with market capitalizations less
than $1 billion.
American Century Income & Growth To attain long-term growth of capital as
Investment Fund Growth & Income well as current income. The Fund pursues
Management, Inc. a total return and dividend yield that
exceeds those of the S&P 500 by
investing in stocks of companies with
strong dividend growth potential.
American Century Aggressive Growth: To obtain capital growth over time by
Investment International Fund International Stock investing in common stocks of foreign
Management, Inc. companies considered to have better-than-
average prospects for appreciation.
Because this Fund invests in foreign
securities, a higher degree of short-term
price volatility, or risk, is expected due
to factors such as currency fluctuation and
political instability.
American Century To attain long-term capital growth, with
Investment Value Fund Growth income as a secondary objective. The
Management, Inc. Fund invests primarily in equity securities
of well-established companies that are
believed by management to be
undervalued at the time of purchase.
</TABLE>
You may change the investments that you want to use for your future
premiums by notifying our Home Office.
You may transfer your cash value among the various funds, but there are
certain rules. We don't charge you a transaction fee for the first
twelve transfers in a policy year, but we charge a $25 fee for each
transfer after the first twelve. (A policy year is measured beginning
on the anniversary of the date that the policy was issued, and ending on
the day before the next anniversary.)
4
<PAGE>
<PAGE>
We have the right to change or eliminate transfers in the future,
although we don't currently intend to do so.
CHARGES AND DEDUCTIONS. There are certain costs that we charge you for
issuing your policy and keeping it in force. This section describes
those charges -- what they are and what they cover.
INITIAL POLICY CHARGE. When we issue your policy, we charge a fee of
$800 to cover the costs associated with underwriting and issuing the
policy and the ongoing administrative costs. We deduct this amount from
the policy's cash value as soon as we have issued the policy and you
have paid your first premium.
STATE TAX CHARGE AND FEDERAL TAX CHARGE. The Federal government and
many states and territories impose taxes or charges on insurance
premiums. We estimate the overall cost of these taxes and charges, and
deduct from your premium payment the amount required to pay them. We
deduct currently 1.3% of each premium payment to pay the Federal tax
charge, and 2.25% of each premium payment to pay the state tax charge in
all states.
If the tax rates change, we may change the amount of the deduction to
cover the new taxes. However, the deduction will never exceed the
amount shown on the specifications page of your policy. (See Charges
and Deductions - Premium Expense Charges.)
If we are required by law to pay taxes based on the separate account, we
may charge an appropriate share to policies that invest in the separate
account. (See Federal Tax Matters.)
COST OF INSURANCE. Because this is a life insurance policy, it has a
death benefit. We charge an insurance cost each month to cover the risk
that you will die and we will have to pay the death benefit.
The amount of this charge varies with the age, sex, risk class of the
person insured under the policy, and the amount of the death benefit at
risk -- if the risk of death or the amount of the death benefit at risk
is greater, then the cost of insurance is also greater. We calculate
and deduct the cost of insurance from your cash value at the beginning
of each policy month.
MORTALITY AND EXPENSE RISK AND DISTRIBUTION CHARGE. We make another
charge to cover mortality and expense risks and certain distribution
expenses under the Policy. We calculate this charge based on a
percentage of the assets in the general account and the separate
account. In determining the percentage to be applied we consider the
total cash value in all of the general account and separate account
funds. In situations in which multiple policies exist on an account,
such as policies on a husband and wife or on business partners, we
combine the general account and separate account funds of all of the
policies to determine the percentage.
We calculate the mortality and expense risk and distribution charge each
month and deduct it from the policy's cash value. We guarantee that the
charge will not exceed the following amounts, shown on an annual
percentage basis:
<TABLE>
<CAPTION>
Total General
and Separate Percentage of Net Assets
Account Funds Distribution Risk Total
------------- ------------ ---- -----
<S> <C> <C> <C>
First $500,000 1.50% 0.75% 2.25%
Next $1,000,000 1.25% 0.75% 2.00%
Next $1,000,000 1.00% 0.75% 1.75%
Next $1,000,000 0.90% 0.75% 1.65%
Next $1,000,000 0.80% 0.75% 1.55%
Next $1,000,000 0.70% 0.75% 1.45%
Next $1,000,000 0.60% 0.75% 1.35%
Over $6,500,000 0.50% 0.75% 1.25%
</TABLE>
(See Charges and Deductions - Separate Account Charges.)
FUND EXPENSES. We pay the operating expenses of the separate account.
The funds pay for their own operating expenses and investment fees. For
a description of these charges, see Charges and Deductions - Separate
Account Charges.
The following chart shows the fees and expenses of the funds as reported
for the fiscal year ending December 31, 1999:
5
<PAGE>
<PAGE>
<TABLE>
ANNUAL FUND EXPENSES<F1>
As a Percentage of Average Net Assets
<CAPTION>
INVESTMENT
FUND ADVISORY / OTHER EXPENSES TOTAL
MANAGEMENT
FEE
GENERAL AMERICAN CAPITAL COMPANY
<S> <C> <C> <C>
S&P 500 Index Fund .25% .05% .30%
Money Market Fund .125% .08% .205%
Bond Index Fund .25% .05% .30%
Managed Equity Fund .29% .10% .39%
Asset Allocation Fund .50% .10% .60%
International Index Fund .50%<F2> .30% .80%
Mid-Cap Equity Fund .55%<F3> .10% .65%
Small-Cap Equity Fund .25% .05% .30%
<CAPTION>
AMERICAN CENTURY VARIABLE PORTFOLIOS
<S> <C> <C> <C>
Income & Growth Fund .70% .00% .70%
International Fund 1.37% .00% 1.37%
Value Fund 1.00% .00% 1.00%
<CAPTION>
J.P. MORGAN SERIES TRUST II
<S> <C> <C> <C>
Bond Portfolio .30% .45% .75%
Small Company Portfolio .60% .55% 1.15%
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
<S> <C> <C> <C>
Equity-Income Portfolio .48% .08% .56%
Growth Portfolio .58% .07% .65%
Overseas Portfolio .73% .14% .87%
High Income Portfolio .58% .11% .69%
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND II
<S> <C> <C> <C>
Asset Manager .53% .09% .62%
<CAPTION>
VAN ECK WORLDWIDE INSURANCE TRUST
<S> <C> <C> <C>
Worldwide Hard Assets Fund 1.00% .34% 1.34%
Worldwide Emerging Markets Fund 1.00% .26% 1.26%
<FN>
<F1> The Fund expenses shown above are collected from the underlying Fund, and are not direct
charges against the Separate Account assets or reductions from the Policy's Cash Value. These
underlying Fund Expenses are taken into consideration in computing each Fund's net asset value,
which is used to calculate the unit values in the Separate Account. The management fees and
other expenses are more fully described in the prospectus of each individual Fund. The
information relating to the Fund expenses was provided by the Fund and was not independently
verified by General American. Except as otherwise specifically noted, the management fees and
other expenses are not currently subject to fee waivers or expense reimbursements.
6
<PAGE>
<PAGE>
<F2> The fees charged by the International Index Fund are stated as a series of annual
percentages of the average daily value of the net assets of the Funds. The percentages decrease
with respect to assets of the Fund above certain amounts, as follows: First $10 million, 0.50%;
Next $10 million, 0.40%; Balance over $20 million, 0.30%.
<F3> The fees charged by the Mid-Cap Equity Fund are stated as a series of annual percentages
of the average daily value of the net assets of the Funds. The percentages decrease with
respect to assets of the Fund above certain amounts, as follows: First $10 million, 0.55%; Next
$10 million, 0.45%; Balance over $20 million, 0.40%.
</TABLE>
7
<PAGE>
<PAGE>
SUMMARY OF FEES
The following tables describe the fees and expenses that you will pay
when buying, owning, and surrendering the policy. The first table
describes the fees and expenses that you will pay at the time that you
buy the policy, surrender the policy, or transfer cash value between
investment options.
<TABLE>
TRANSACTION FEES
<CAPTION>
CHARGE WHEN CHARGE IS AMOUNT DEDUCTED POLICIES FROM WHICH
DEDUCTED CHARGE IS DEDUCTED
<S> <C> <C> <C>
Maximum Sales Charge
Imposed on Premiums N/A None N/A
(Load)
Initial Policy Charge When we issue your policy $800 All
State Taxes Each time you pay a 2.25% of premium All
premium payment
Federal Tax Each time you pay a 1.30% of premium All
premium payment
Maximum Deferred Sales N/A None N/A
Charge (Load)
Other Surrender Fees N/A None N/A
Transfer Fees Each fund transfer after 12 $25 All
in a policy year
</TABLE>
The next table describes the fees and expenses that you will pay
periodically during the time that you own the policy, not including fund
fees and expenses.
<TABLE>
ANNUAL CHARGES OTHER THAN FUND OPERATING EXPENSES
<CAPTION>
CHARGE WHEN CHARGE IS AMOUNT DEDUCTED POLICIES FROM WHICH
DEDUCTED CHARGE IS DEDUCTED
<S> <C> <C> <C>
From $0 to $1000 per
Cost of Insurance <F*> Monthly $1000 at risk. Varies by All
(1/12th of annual rate) age, risk class, sex (where
permitted), smoker status.
Annual Maintenance Fee N/A None N/A
Mortality and Expense Monthly 0.75% of net assets All
Risk Charge (1/12th of annual rate)
Distribution Charge Monthly From 0.50% to 1.50% All
(1/12th of annual rate) of net assets
Administrative Fees N/A None N/A
<FN>
<F*> Rates are based on the 1980 CSO Mortality Table and vary by age, risk class, sex (where
permitted), and smoker status. Sample annual rates per $1000 at risk for a male standard
smoker: Age 35: $2.63. Age 50: $9.50.
</TABLE>
The next table described the fund fees and expenses that you will pay
periodically during the time that you own the policy. The table shows
the minimum and maximum fees and expenses charged by any of the funds.
More detail concerning each fund's fees and expenses is contained in the
prospectus for each fund.
<TABLE>
ANNUAL FUND OPERATING EXPENSES
<CAPTION>
CHARGE WHEN CHARGE IS AMOUNT DEDUCTED POLICIES FROM WHICH
DEDUCTED CHARGE IS DEDUCTED
<S> <C> <C> <C>
Management Fees Monthly 0.125% to 1.50% All
(1/12th of annual rate) of net assets
Distribution Fees N/A None N/A
Other Expenses Monthly 0.00% to 0.55% All
(1/12th of annual rate) of net assets
Total Fund Annual Expenses Monthly 0.205% to 1.50% All
(1/12th of annual rate) of net assets
</TABLE>
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DEATH BENEFIT. If the person insured under the policy dies while the
policy is in force, we will pay a death benefit to the beneficiary.
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If the person insured is less than attained age 100 at the time of
death, the death benefit will be equal to the policy's cash value on the
date of death, multiplied by an attained age factor. The attained age
factors are shown on a table in the policy. The factors shown in the
policy are for deaths occurring on the policy anniversary. For any
other date, we will determine the factor by interpolation, or
calculating the daily value between the anniversary dates.
If the person insured is rated in either a standard or preferred risk
classification, and if you have some or all of your cash value in the
general account, then we will further guarantee your death benefit. The
portion of the death benefit associated with the cash value in the
general account can only decrease from one policy anniversary to the
next as a result of:
* charges for benefits provided by any riders;
* transfers from the general account to the separate account;
* pro-rata surrenders; or
* policy loans.
If the person insured has reached attained age 100 at the time of death,
the death benefit will be equal to 101% of the policy's cash value (100%
if required by state law).
We will increase the policy proceeds by the cost of insurance from the
date of death to the end of the policy month, and reduce them by any
outstanding loans and interest. We will pay the death benefit according
to the settlement options available at the time of death. (See Policy
Benefits - Death Benefit.)
You may include additional insurance benefits with your policy. These
are described under General Matters - Additional Insurance Benefits. If
you elect any additional benefits, we will deduct the charges for those
benefits from your Cash Value.
CASH VALUE. Your Policy has a cash value that is the total amount
credited to you in the separate account, the loan account, and the
general account. The cash value increases by the amount of net premium
payments, and decreases by expense charges and deductions for the
policy. It may either increase or decrease based on the investment
experience of the funds that you have selected. (See Policy Benefits -
Cash Value.)
There is no minimum guaranteed cash value.
POLICY LOANS. You may borrow against the cash value of your policy.
The loan value is the maximum amount that you may borrow. The loan
value is:
the cash value on the date we receive the loan request;
plus interest on the loan balance to the next policy anniversary,
calculated at the guaranteed general account interest rate;
minus interest on the new loan to the next policy anniversary;
minus any loans and interest already outstanding;
minus monthly deductions to the next policy anniversary.
Unless you specify otherwise, when you borrow against the policy, we
will take the money from the general account and the divisions of the
separate account in proportion to your balances in each account.
Loan interest is due at each policy anniversary. If you don't pay the
loan interest, we will add it to the amount of the loan.
You may repay all or part of the loan at any time. When you make a loan
payment, we will put the money back into the general account or the
divisions of the separate account in the same percentages used to make
the loan.
When we pay out the proceeds of your policy, either as a death benefit
or as a policy surrender, we will deduct any outstanding loans and
interest from the amount we pay. (See Policy Rights - Loans.)
Loans taken from or secured by a policy may have Federal income tax
consequences. (See Federal Tax Matters.)
SURRENDER AND PRO-RATA SURRENDER. You may surrender the policy at any
time while it is in force. We will pay you the cash surrender value.
You may request a pro-rata surrender of the policy, which allows you to
surrender part of the policy and keep the rest in force. You can find
more information under Policy Rights - Surrender and Pro-Rata Surrender.
A surrender or pro-rata surrender may have Federal income tax
consequences. We suggest that you discuss your situation with a
competent tax adviser before taking one of these steps. (See Federal
Tax Matters.)
<PAGE>
TAX CONSEQUENCES OF THE POLICY. If your policy was issued in a standard
premium class, then we believe that it qualifies as a life insurance
contract for Federal income tax purposes. However, if the policy was
issued on a substandard basis, it is not clear whether it will qualify
as a life insurance contract for tax
9
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purposes. The IRS has provided very limited guidance in this area.
Assuming that the policy does qualify as a life insurance contract for
Federal income tax purposes, then we believe that the cash value should
be subject to the same tax treatment as the cash value of a conventional
fixed-benefit contract. This means that growth in the cash value will
not be taxed until you receive a distribution.
There are some actions that may trigger a tax. If you transfer
ownership to someone else, or if you surrender the policy or withdraw
cash from it under a pro-rata surrender, you may have to pay a tax.
Similarly, if you let the policy lapse while there is an outstanding
loan, or if you exchange the policy for another policy, you may owe a
tax. (See Federal Tax Matters.)
Based on your premium payments, your policy may become a "modified
endowment contract." If that happens, then some pre-death distributions
of cash will be taxable income. If there is more cash value in the
policy than what you actually paid in premiums, you will be taxed on the
excess in the year in which you receive a distribution. You may
withdraw the amount that you paid into the policy without being taxed,
but only after you have received the excess as taxable income. In
addition, any taxable distribution that you receive before age 59 1/2
will generally be subject to an additional 10% tax.
On the other hand, if the policy is not a modified endowment contract,
then distributions are normally treated first as a return of your "cost
basis," or investment in the contract. In this case, you may withdraw
up to the amount of the premiums you paid with no tax consequences.
After that, any additional distributions are treated as taxable income.
In addition, loans from the policy are not treated as distributions, so
they are not considered taxable income. Finally, if your policy is not
a modified endowment contract, neither distributions or loans are
subject to the 10% additional tax (See Federal Tax Matters.)
Please note that General American is neither a law firm nor a tax
adviser, so we cannot give you legal or tax advice. If you have
specific legal or tax questions, we suggest that you consult a qualified
professional in these fields.
* * *
This Prospectus describes only those aspects of the Policy that relate
to the Separate Account, except where General Account matters are
specifically mentioned. For a brief summary of the aspects of the
Policy relating to the General Account, see The General Account.
10
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DEFINITIONS
ATTAINED AGE - The Issue Age of the Insured plus the number of completed
Policy Years.
BENEFICIARY - The person or persons named in the application or by later
designation to receive Policy proceeds in the event of the Insured's
death. A Beneficiary may be changed as set forth in the Policy and this
Prospectus.
CASH VALUE - The total amount that a Policy provides for investment at
any time. It is equal to the total of the amounts credited to the Owner
in the Separate Account, the General Account, and the Loan Account.
CASH SURRENDER VALUE - The Cash Value of a Policy on the date of
surrender, plus unearned cost of insurance charges from the date of
surrender to the end of the Policy Month, less any Indebtedness.
DIVISION - A subaccount of the Separate Account. Each Division invests
exclusively in the shares of a corresponding Fund of General American
Capital Company, American Century Variable Portfolios, J.P. Morgan
Series Trust II, Variable Insurance Products Fund, Variable Insurance
Products Fund II, or Van Eck Worldwide Insurance Trust.
FUND - A separate investment portfolio of General American Capital
Company, American Century Variable Portfolios, J.P. Morgan Series Trust
II, Variable Insurance Products Fund, Variable Insurance Products Fund
II, or Van Eck Worldwide Insurance Trust. Although sometimes referred
to elsewhere as "portfolios," they are referred to in this prospectus as
"Funds," except where "Portfolio" is part of their name.
GENERAL ACCOUNT - The assets of the Company other than those allocated
to the Separate Account or any other separate account.
HOME OFFICE - The service office of General American Life Insurance
Company, the mailing address of which is P.O. Box 14490, St. Louis,
Missouri 63178.
INDEBTEDNESS - The sum of all unpaid Policy Loans and accrued interest
on loans.
INSURED - The person whose life is insured under the Policy.
INVESTMENT START DATE - The date the initial premium is applied to the
General Account or to the Divisions of the Separate Account. This date
is the later of the Issue Date or the date the initial premium is
received at General American's Home Office.
ISSUE AGE - The Insured's age at his or her nearest birthday as of the
date the Policy is issued.
ISSUE DATE - The effective date of the coverage under the Policy. This
is the date from which Policy Anniversaries, Policy Years, and Policy
Months are measured.
LOAN ACCOUNT - The account of the Company to which amounts securing
Policy Loans are allocated.
LOAN SUBACCOUNT - A Loan Subaccount exists for the General Account and
for each Division of the Separate Account. Any Cash Value transferred
to the Loan Account will be allocated to the appropriate Loan Subaccount
to reflect the origin of the Cash Value. At any point in time, the Loan
Account will equal the sum of all the Loan Subaccounts.
MONTHLY ANNIVERSARY - The same date in each succeeding month as the
Issue Date except that whenever the Monthly Anniversary falls on a date
other than a Valuation Date, the Monthly Anniversary will be deemed the
next Valuation Date. If any Monthly Anniversary would be the 29th,
30th, or 31st day of a month that does not have that number of days,
then the Monthly Anniversary will be the last day of that month.
NET PREMIUM - The premium less the state tax charge and the federal tax
charge.
OWNER - The Owner of a Policy, as designated in the application or as
subsequently changed.
POLICY - The variable life insurance Policy offered by the Company and
described in this Prospectus.
POLICY ANNIVERSARY - The same date each year as the Issue Date.
POLICY MONTH - A month beginning on the Monthly Anniversary.
POLICY YEAR - A period beginning on a Policy Anniversary and ending on
the day immediately preceding the next Policy Anniversary.
PORTFOLIO - see Fund.
<PAGE>
PRO-RATA SURRENDER - A requested reduction of both the death benefit and
the Cash Value by a given percentage.
11
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SEC - The United States Securities and Exchange Commission.
SEPARATE ACCOUNT - General American Separate Account Eleven, a separate
investment account established by the Company to receive and invest the
Net Premiums paid under the Policy, and certain other variable life
policies, and allocated by the Owner to provide variable benefits.
VALUATION DATE - Each day that the New York Stock Exchange is open for
trading.
VALUATION PERIOD - The period between two successive Valuation Dates,
currently commencing at 4:00 p.m. (Eastern Standard Time) on a
Valuation Date and ending 4:00 p.m. on the next succeeding Valuation
Date.
THE COMPANY, THE SEPARATE
ACCOUNT, AND THE FUNDS
THE COMPANY
General American Life Insurance Company ("General American" or "the
Company") was originally incorporated as a stock company in 1933. In
1936, General American initiated a program to convert to a mutual life
insurance company. In 1997, General American's policyholders approved a
reorganization of the Company into a mutual holding company structure
under which General American became a stock company wholly owned by
GenAmerica Corporation, an intermediate stock holding company.
On January 6, 2000 The Metropolitan Life Insurance Company of New York
("MetLife") acquired GenAmerica Corporation. As a result of that
transaction, General American became an indirect, wholly-owned
subsidiary of MetLife.
Headquartered in New York City since 1868, MetLife is a leading provider
of insurance and financial services to a broad spectrum of individual
and group customers. The company provides individual insurance and
investment products to approximately 9 million households in the United
States. MetLife also serves over 33 million people by providing group
insurance and investment products to corporations and other
institutions.
General American is principally engaged in writing individual and group
life insurance policies and annuity contracts. As of December 31, 1999,
it had consolidated assets of approximately $23 billion. It is admitted
to do business in 49 states, the District of Columbia, Puerto Rico, and
in ten Canadian provinces. The principal offices of General American
are located at 700 Market Street, St. Louis, Missouri 63101. The
mailing address of General American's service center ("the Home Office")
is P.O. Box 14490, St. Louis, Missouri 63178.
THE SEPARATE ACCOUNT
General American Life Insurance Company Separate Account Eleven ("the
Separate Account") was established by General American as a separate
investment account on January 24, 1985 under Missouri law. The Separate
Account will receive and invest the Net Premiums paid under this Policy
and allocated to it. In addition, the Separate Account currently
receives and invests Net Premiums for other classes of variable life
insurance policies and might do so for additional classes in the future.
The Separate Account has been registered with the SEC as a unit
investment trust under the Investment Company Act of 1940 ("the 1940
Act") and meets the definition of a "separate account" under Federal
securities laws. Registration with the SEC does not involve supervision
of the management or investment practices or policies of the Separate
Account or General American by the SEC.
The Separate Account is divided into multiple Divisions, although not
all Divisions may be available for investment under the Policy.
Divisions invest in corresponding Funds from one of several open-end,
diversified management investment companies: General American Capital
Company, American Century Variable Portfolios, J.P. Morgan Series Trust
II, Variable Insurance Products Fund, Variable Insurance Products Fund
II, and Van Eck Worldwide Insurance Trust. Income and both realized and
unrealized gains or losses from the assets of each Division of the
Separate Account are credited to or charged against that Division
without regard to income, gains, or losses from any other Division of
the Separate Account or arising out of any other business General
American may conduct.
<PAGE>
Although the assets of the Separate Account are the property of General
American, the assets in the Separate Account equal to the reserves and
other liabilities of the Separate Account are not chargeable with
liabilities arising out of any other business which General American may
conduct. The assets of the Separate Account are available to cover the
general liabilities of General American only to the extent that the
Separate Account's assets exceed its liabilities arising under the
Policies. From time to time, the Company may transfer to its General
Account any assets of the Separate Account that exceed the reserves and
the Policy liabilities of the Separate Account (which will always be at
least equal to the
12
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aggregate Policy value allocated to the Separate Account under the
Policies). Before making any such transfers, General American will
consider any possible adverse impact the transfer may have on the
Separate Account.
THE FUNDS
THERE IS NO ASSURANCE THAT ANY OF THE FUNDS WILL ACHIEVE ITS STATED
OBJECTIVE. It is conceivable that in the future it may be
disadvantageous for Funds to offer shares to separate accounts of
various insurance companies to serve as the investment medium for their
variable products or for both variable life and annuity separate
accounts to invest simultaneously in a Fund. The Boards of Trustees of
each Fund, the respective Advisors of each Fund, and the Company and any
other insurance companies participating in the Funds are required to
monitor events to identify any material irreconcilable conflicts that
may possibly arise, and to determine what action, if any, should be
taken in response to those events or conflicts. A more detailed
description of the Funds, their investment policies, restrictions,
risks, and charges is in the prospectuses for each Fund, which must
accompany or precede this Prospectus and which should be read carefully.
The investment objectives and policies of certain Funds are similar to
the investment objectives and policies of other portfolios that may be
managed by the same investment adviser or manager. The investment
results of the Funds, however, may differ from the results of such other
portfolios. There can be no assurance, and no representation is made,
that the investment results of any of the Funds will be comparable to
the investment results of any other portfolio, even if the other
portfolio has the same investment adviser or manager.
We may receive compensation from one or more of the Funds (or their
affiliates) based upon an annual percentage of the average net assets we
hold in the Fund. These amounts are intended to compensate us for
administrative or other services we provide to the Funds or their
affiliates.
GENERAL AMERICAN CAPITAL COMPANY
General American Capital Company ("the Capital Company") is an open-end,
diversified management investment company which was incorporated in
Maryland on November 15, 1985, and commenced operations on October 1,
1987. Only the Funds described in this section of the Prospectus are
currently available as investment choices for this Policy even though
additional Funds may be described in the prospectus for the Capital
Company. Shares of Capital Company are currently offered to separate
accounts established by General American Life Insurance Company and
affiliates. The Capital Company's investment adviser is Conning Asset
Management Company ("the Advisor"), an indirect, majority-owned
subsidiary of General American. The adviser selects investments for the
Funds.
The investment objectives and policies of each Fund are summarized
below:
S&P 500 INDEX FUND: The investment objective of this Fund is to
provide investment results that parallel the price and yield
performance of publicly-traded common stocks in the aggregate.
The Fund uses the Standard & Poor's Composite Index of 500 Stocks
("the S&P Index") as its standard for performance comparison.
The Fund attempts to duplicate the performance of the S&P Index
and includes dividend income as a component of the Fund's total
return. The Fund is not managed by Standard & Poor's.
THE MONEY MARKET FUND: The investment objective of the Money
Market Fund is to obtain the highest level of current income which
is consistent with the preservation of capital and maintenance of
liquidity. The Fund invests primarily in high-quality, short-term
money market instruments. An investment in the Money Market Fund
is neither insured nor guaranteed by the U. S. Government.
BOND INDEX FUND: The investment objective of this Fund is to
provide a rate of return that reflects the performance of the
publicly-traded bond market as a whole. The Fund uses the Lehman
Brothers Government/Corporate Bond Index as its standard for
performance comparison.
MANAGED EQUITY FUND: The investment objective of this Fund is
long-term growth of capital, obtained by investing primarily in
common stocks. Securing moderate current income is a secondary
objective.
ASSET ALLOCATION FUND: The investment objective of this Fund is a
high rate of long-term total return composed of capital growth and
income payments. Preservation of capital is the secondary
objective and chief limit on investment risk. The Fund will
invest only in those types of securities that the other Capital
Company Funds may invest in. The Asset Allocation Fund invests in
a combination of common stocks, bonds, or money market instruments
in accordance with guidelines
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established from time to time by Capital Company's Board of
Directors.
INTERNATIONAL INDEX FUND: The investment objective of this Fund is
to obtain investment results that parallel the price and yield
performance of publicly-traded common stocks in the Morgan Stanley
Capital International ("MSCI") Europe, Australia and Far East
Index ("EAFE").
MID-CAP EQUITY FUND: The investment objective of this Fund is
capital appreciation. It pursues this objective by investing
primarily in common stocks of United States-based, publicly traded
companies with medium market capitalizations falling within the
capitalization range of the S&P Mid-Cap 400 at the time of the
Fund's investment.
SMALL-CAP EQUITY FUND: The investment objective of this Fund is to
provide a rate of return that corresponds to the performance of
the common stock of small companies, while incurring a level of
risk that is generally equal to the risks associated with small
company common stock. The Fund attempts to duplicate the
performance of the smallest 20% of companies, based on
capitalization size, that are based in the United States and
listed on the New York Stock Exchange ("NYSE").
AMERICAN CENTURY VARIABLE PORTFOLIOS
American Century Variable Portfolios, Inc., a part of American Century
Investments, was organized as a Maryland corporation on June 4, 1987.
It is a diversified, open-end management investment company. Its
business and affairs are managed by its officers under the Direction of
its Board of Directors. American Century Investment Management, Inc.
serves as the investment manager of the fund.
The investment objective and policies of the Funds are summarized below:
INCOME & GROWTH FUND: The investment objective of this Fund is to
attain long-term growth of capital as well as current income. The
Fund pursues a total return and dividend yield that exceed those
of the S&P 500 by investing in stocks of companies with strong
dividend growth potential. Dividends are paid monthly.
INTERNATIONAL FUND: This Fund seeks capital growth over time by
investing in common stocks of foreign companies considered to have
better-than-average prospects for appreciation. Because the Fund
invests in foreign securities, a higher degree of short-term price
volatility, or risk, is expected due to factors such as currency
fluctuation and political instability.
VALUE FUND: This Fund is a core equity fund that seeks long-term
capital growth. Income is a secondary objective. To pursue its
objectives, the fund invests primarily in equity securities of
well-established companies that are believed by management to be
undervalued at the time of purchase. Please note that this is an
equity investment and, by nature, may fluctuate in value.
J.P. MORGAN SERIES TRUST II
J.P. Morgan Series Trust II is an open-end diversified management
investment company organized as a Delaware Business Trust. The Trust's
investment adviser is J.P. Morgan Investment Management, Inc., a
registered investment adviser and a wholly owned subsidiary of J.P.
Morgan & Co., Incorporated, a bank holding company organized under the
laws of Delaware.
The investment objective and policies of the Funds are summarized below:
BOND PORTFOLIO: This Fund seeks to provide a high total return
consistent with moderate risk of capital and maintenance of
liquidity. The Fund is designed for investors who seek a total
return over time that is higher than that generally available from
a portfolio of short-term obligations while acknowledging the
greater price fluctuation of longer-term instruments.
SMALL COMPANY PORTFOLIO: The investment objective of this Fund is
to provide high total return from a portfolio of equity securities
of small companies. The Fund invests at least 65% of the value of
its total assets in the common stock of small U.S. Companies
primarily with market capitalizations less than $1 billion. The
Fund is designed for investors who are willing to assume the
somewhat higher risk of investing in small companies in order to
seek a higher return over time than might be expected from a
portfolio of stocks of large companies.
VARIABLE INSURANCE PRODUCTS FUND
Variable Insurance Products Fund ("VIP") is an open-end, diversified
management investment company organized as a Massachusetts business
trust on November 13, 1981. Only the Funds described in this section of
the Prospectus are currently available
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as investment choices for this Policy even though additional Funds may
be described in the prospectus for VIP. VIP shares are purchased by
insurance companies to fund benefits under variable insurance and
annuity policies. Fidelity Management & Research Company ("FMR") of
Boston, Massachusetts is the Funds' Manager.
The investment objectives and policies of each Fund are summarized
below:
EQUITY-INCOME PORTFOLIO: The investment objective of this Fund is
income, obtained by investing primarily in income-producing equity
securities. In choosing these securities, FMR will also consider
the potential for capital appreciation. The Fund's goal is to
achieve a yield which exceeds the composite yield on the
securities comprising the Standard & Poor's Composite Index of 500
Stocks.
GROWTH PORTFOLIO: The investment objective of this Fund is capital
appreciation. The Fund normally purchases common stocks, although
its investments are not restricted to any one type of security.
Capital appreciation may also be obtained from other types of
securities, including bonds and preferred stocks.
OVERSEAS PORTFOLIO: The investment objective of this Fund is long-
term growth of capital. The Fund invests primarily in foreign
securities. The Overseas Portfolio provides a means for investors
to diversify their own portfolios by participation in companies
and economies outside of the United States.
HIGH INCOME PORTFOLIO: The investment objective of this Fund is a
high level of current income. The Fund seeks to fulfill the
objective by investing primarily in high-yielding, lower-rated,
fixed-income securities, while also considering growth of capital.
Lower-rated securities, commonly referred to as "junk bonds,"
involve greater risk of default or price change than securities
assigned a higher quality rating.
VARIABLE INSURANCE PRODUCTS FUND II
Variable Insurance Products Fund II ("VIP II") is an open-end,
diversified management investment company organized as a Massachusetts
business trust on March 21, 1988. Only the Fund described in this
section of the Prospectus is currently available as an investment choice
for this Policy even though additional Funds may be described in the
prospectus for VIP II. VIP II shares are purchased by insurance
companies to fund benefits under variable insurance and annuity
policies. FMR is the Fund's manager.
The investment objective and policies of the Funds are summarized below:
ASSET MANAGER: The investment objective of this Fund is to seek a
high total return with reduced risk over the long-term by
allocating its assets among domestic and foreign stocks, bonds,
and short-term fixed income instruments.
VAN ECK WORLDWIDE INSURANCE TRUST
Van Eck Worldwide Insurance Trust ("Van Eck") is an open-end management
investment company organized as a Massachusetts business trust on
January 7, 1987. Only the Funds described in this section of the
Prospectus is currently available as an investment choice for this
Policy even though additional Funds may be described in the prospectus
for Van Eck. Shares of Van Eck are offered only to separate accounts of
various insurance companies to support benefits of variable insurance
and annuity policies. The assets of Van Eck are managed by Van Eck
Associates Corporation of New York, New York.
The investment objectives and policies of the Fund are summarized below:
WORLDWIDE HARD ASSETS FUND: The investment objective of the Fund
is to seek long-term capital appreciation by investing in equity
and debt securities of companies engaged in the exploration,
development, production, and distribution of one or more of the
following: (i) precious metals, (ii) ferrous and non-ferrous
metals, (iii) oil and gas, (iv) forest products, (v) real estate,
and (vi) other basic non-agricultural commodities (together, "Hard
Assets"). Current income is not an objective.
WORLDWIDE EMERGING MARKETS FUND: The investment objective of this
Fund is to obtain long-term capital appreciation by investing in
equity securities in emerging markets around the world. The Fund
emphasizes primarily investment in countries that, compared to the
world's major economies, exhibit relatively low gross national
product per capita, as well as the potential for rapid economic
growth.
15
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<PAGE>
ADDITION, DELETION, OR SUBSTITUTION OF INVESTMENTS
The Company reserves the right, subject to compliance with applicable
law, to make additions to, deletions from, or substitutions for the
shares that are held by the Separate Account or that the Separate
Account may purchase. The Company reserves the right to eliminate the
shares of any of the Funds and to substitute shares of another Fund or
of another registered open-end investment company if the shares of a
Fund are no longer available for investment or if in its judgment
further investment in any Fund becomes inappropriate in view of the
purposes of the Separate Account. The Company will not substitute any
shares attributable to an Owner's interest in a Division of the Separate
Account without notice to the Owner and prior approval of the SEC, to
the extent required by the 1940 Act or other applicable law. Nothing
contained in this Prospectus shall prevent the Separate Account from
purchasing other securities for other series or classes of policies, or
from permitting a conversion between series or classes of policies on
the basis of requests made by Owners.
The Company also reserves the right to establish additional Divisions of
the Separate Account, each of which would invest in a new Fund with a
specified investment objective. New Divisions may be established when,
in the sole discretion of the Company, marketing needs or investment
conditions warrant. Any new Division will be made available to existing
Owners on a basis to be determined by the Company. To the extent
approved by the SEC, the Company may also eliminate or combine one or
more Divisions, substitute one Division for another Division, or
transfer assets between Divisions if, in its sole discretion, marketing,
tax, or investment conditions warrant.
In the event of a substitution or change, the Company may, if it
considers it necessary, make such changes in the Policy by appropriate
endorsement and offer conversion options required by law, if any. The
Company will notify all Owners of any such changes.
If deemed by the Company to be in the best interests of persons having
voting rights under the Policy, and to the extent any necessary SEC
approvals or Owner votes are obtained, the Separate Account may be: (a)
operated as a management company under the 1940 Act; (b) de-registered
under that Act in the event such registration is no longer required; or
(c) combined with other separate accounts of the Company. To the extent
permitted by applicable law, the Company may also transfer the assets of
the Separate Account associated with the Policy to another separate
account.
POLICY BENEFITS
DEATH BENEFIT
As long as the Policy remains in force (See Payment and Allocation of
Premiums - Premium Default and Reinstatement), the Company will, upon
receipt of proof of the Insured's death at its Home Office, pay the
policy proceeds in a lump sum. The amount of the death benefit payable
will be determined at the end of the Valuation Period during which the
Insured's death occurred. The policy proceeds will be paid to the
surviving Beneficiary or Beneficiaries specified in the application or
as subsequently changed.
AMOUNT OF DEATH BENEFIT. On the Issue Date, the death benefit is the
initial death benefit as shown in the Policy. After the Issue Date and
prior to the Insured reaching Attained Age 100, the death benefit is
equal to the Cash Value on the date of death multiplied by the
applicable Attained Age factor shown in the Policy. The factors in the
Policy are exact for Policy Anniversaries. For any other date, we
calculate the factor by straight line interpolation, or assuming that
the difference between Policy Anniversary values occurs in equal
increments each day. The resulting value is the death benefit. A list
of sample Attained Age factors is shown in the Sample Attained Age
Factor Table below.
At Attained Age 100 and above, the death benefit is 101% of the Cash
Value (100% if required by state law).
<PAGE>
<TABLE>
DEATH BENEFIT
SAMPLE ATTAINED AGE FACTOR TABLE
NON-SMOKER RATES
<CAPTION>
INSURED MALE LIVES FEMALE LIVES
ATTAINED AGE FACTOR FACTOR
<S> <C> <C>
35 4.3267 4.8520
40 3.6574 4.1052
45 3.1018 3.4898
50 2.6430 2.9790
55 2.2664 2.5552
60 1.9629 2.2033
65 1.7206 1.9091
70 1.5315 1.6724
75 1.3865 1.4809
80 1.2805 1.3373
85 1.2015 1.2310
90 1.1454 1.1563
95 1.0892 1.0906
</TABLE>
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<PAGE>
PAYMENT OF THE POLICY PROCEEDS. The policy proceeds will ordinarily be
paid in a lump sum within seven days after the Company receives all
documentation required for such a payment. Payment may, however, be
postponed in certain circumstances. (See General Matters - Postponement
of Payment from the Separate Account.) The death benefit will be
increased by unearned cost of insurance charges from the date of death
to the end of the Policy Month, and reduced by any outstanding
Indebtedness. (See General Matters - Additional Insurance Benefits, and
Charges and Deductions.) The Company will pay interest on the death
benefit from the date of the Insured's death to the date of payment.
Interest will be at an annual rate determined by the Company, but will
never be less than the guaranteed rate of 4%. Provisions for settlement
of proceeds other than a lump sum payment may only be made upon written
agreement with the Company.
CASH VALUE
The Cash Value of the Policy is equal to the total of the amounts
credited to the Owner in the Separate Account, the General Account, and
the Loan Account (securing Policy Loans). The Policy's Cash Value in
the Separate Account will reflect the investment performance of the
chosen Divisions of the Separate Account as measured by each Division's
Net Investment Factor (defined below), the frequency and amount of Net
Premiums paid, transfers, loans and the charges assessed in connection
with the Policy. An Owner may at any time surrender the Policy and
receive the Policy's Cash Surrender Value. (See Policy Rights -
Surrender and Pro-Rata Surrender.) The Policy's Cash Value in the
Separate Account equals the sum of the Policy's Cash Values in each
Division. There is no guaranteed minimum Cash Value.
DETERMINATION OF CASH VALUE. For each Division of the Separate Account,
the Cash Value is determined on each Valuation Date. On the Investment
Start Date, the Cash Value in a Division will equal the portion of the
initial Net Premium allocated to the Division, reduced by the portion of
the monthly deduction(s) due from the Issue Date through the Investment
Start Date charged to the Division. (See Payment and Allocation of
Premiums.) Thereafter, on each Valuation Date, the Cash Value in a
Division of the Separate Account will equal:
(1) The Cash Value in the Division on the preceding Valuation
Date, multiplied by the Division's Net Investment Factor (defined
below) for the current Valuation Period; plus
(2) Any Net Premium payments received during the current
Valuation Period which are allocated to the Division; plus
(3) Any loan repayments allocated to the Division during the
current Valuation Period; plus
(4) Any amounts transferred to the Division from the General
Account or from another Division during the current Valuation
Period; plus
(5) That portion of the interest credited on outstanding loans
which is allocated to the Division during the current Valuation
Period; minus
(6) Any amounts transferred from the Division to the General
Account, Loan Account, or to another Division during the current
Valuation Period (including any transfer charges); minus
(7) Any withdrawal due to a Pro-Rata Surrender from the Division
during the current Valuation Period; minus
(8) If a Monthly Anniversary occurs during the current Valuation
Period, the portion of the monthly deduction allocated to the
Division during the current Valuation Period (See Charges and
Deductions.).
For a description of the Cash Value in the General Account, see The
General Account. For a description of the Cash Value in the Loan
Account, see Policy Rights - Loans.
NET INVESTMENT FACTOR: The Net Investment Factor measures the
investment performance of a Division during a Valuation Period. The Net
Investment Factor for each Division for a Valuation period is calculated
as follows:
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<PAGE>
(1) The value of the assets at the end of the preceding
Valuation Period; plus
(2) The investment income and capital gains, realized or
unrealized, credited to the assets in the Valuation Period for
which the Net Investment Factor is being determined; minus
(3) The capital losses, realized or unrealized, charged against
those assets during the Valuation Period; minus
(4) Any amount charged against each Division for taxes,
including any tax or other economic burden resulting from the
application of the tax laws determined by the Company to be
properly attributable to the Divisions of the Separate Account, or
any amount set aside during the Valuation Period as a reserve for
taxes attributable to the operation or maintenance of each
Division; divided by
(5) The value of the assets at the end of the preceding
Valuation Period.
POLICY RIGHTS
LOANS
LOAN PRIVILEGES. The Owner may, by written request to General American,
borrow an amount up to the Loan Value of the Policy, with the Policy
serving as sole security for such loan. A loan taken from, or secured
by, a Policy may have Federal income tax consequences. (See Federal Tax
Matters.)
The Loan Value is the Cash Value of the Policy on the date the loan
request is received, less interest to the next loan interest due date,
less anticipated monthly deductions to the next loan interest due date,
less any existing loan, plus interest expected to be earned on the loan
balance to the next loan interest due date. Policy Loan interest is
payable on each Policy Anniversary.
The minimum amount that may be borrowed is $500. The loan may be
completely or partially repaid at any time while the Insured is living.
Any amount due to an Owner under a Policy Loan ordinarily will be paid
within seven days after General American receives the loan request at
its Home Office, although payments may be postponed under certain
circumstances. (See General Matters - Postponement of Payments from the
Separate Account.)
When a Policy Loan is made, Cash Value equal to the amount of the loan
plus interest due will be transferred to the Loan Account as security
for the loan. A Loan Subaccount exists within the Loan Account for the
General Account and each Division of the Separate Account. Amounts
transferred to the Loan Account to secure Indebtedness are allocated to
the appropriate Loan Subaccount to reflect its origin. Unless the Owner
requests a different allocation, amounts will be transferred from the
Divisions of the Separate Account and the General Account in the same
proportion that the Policy's Cash Value in each Division and the General
Account, if any, bears to the Policy's total Cash Value, less the Cash
Value in the Loan Account, at the end of the Valuation Period during
which the request for a Policy Loan is received. This will reduce the
Policy's Cash Value in the General Account and Separate Account. These
transactions will not be considered transfers for purposes of the
limitations on transfers between Divisions or to or from the General
Account.
The Cash Value in the Loan Account on the Investment Start Date is zero.
On any other Valuation Date, the Cash Value in the Loan Account is:
* the Cash value in the Loan Account on the preceding Valuation
Date, with interest; plus
* any amount transferred to the Loan Account from the General
Account or from the Divisions of the Separate Account on that day;
minus
* any loan repayments on that day; plus
* if that day is a Policy Anniversary, an amount due to cover any
unpaid loan interest due.
Cash Value in the Loan Account is expected to earn interest at a rate
("the earnings rate") which is lower than the rate charged on the Policy
Loan ("the borrowing rate"). Cash Value in the Loan Account will accrue
interest daily at an annual earnings rate of 4%.
Interest credited on the Cash Value held in the Loan Account will be
allocated to the General Account and the Divisions of the Separate
Account at least annually, in the same proportion that the Cash Value in
each Loan Subaccount bears to the Cash Value in the Loan Account.
INTEREST CHARGED. The borrowing rate we charge for Policy Loan interest
will be based on the following schedule:
<PAGE>
<TABLE>
<CAPTION>
FOR LOANS ANNUAL
OUTSTANDING DURING INTEREST RATE
<S> <C>
Policy Years 1-10 4.50%
Policy Years 11+ 4.25%
</TABLE>
General American will inform the Owner of the current borrowing rate
when a Policy Loan is requested.
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Policy Loan interest is due and payable annually on the earliest of:
* the next Policy Anniversary;
* the date of termination of the Policy;
* the date the loan is repaid in full; or
* the date the loan plus loan interest accrued exceeds the cash
value.
If the Owner does not pay the interest when it is due, the unpaid loan
interest will be added to the outstanding Indebtedness as of the due
date and will be charged interest at the same rate as the rest of the
Indebtedness. (See Effect of Policy Loans below.) The amount of Policy
Loan interest which is transferred to the Loan Account will be deducted
from the Divisions of the Separate Account and from the General Account
in the same proportion that the portion of the Cash Value in each
Division and in the General Account, respectively, bears to the total
Cash Value of the Policy minus the Cash Value in the Loan Account.
EFFECT OF POLICY LOANS. Whether or not a Policy Loan is repaid, it will
permanently affect the Cash Value and the amount of the death benefit.
The collateral for the loan (the amount held in the Loan Account) does
not participate in the performance of the Separate Account while the
loan is outstanding. If the Loan Account earnings rate is less than the
investment performance of the selected Division(s), the Cash Value and
the death benefit will be lower as a result of the Policy Loan.
Conversely, if the Loan Account earnings rate is higher than the
investment performance of the Division(s), the Cash Value and death
benefit may be higher.
In addition, if the Indebtedness (See Definitions) exceeds the Cash
Surrender Value on any Monthly Anniversary, the Policy will lapse. A
lapsed Policy, however, may later be reinstated subject to certain
limitations. (See Payment and Allocation of Premiums - Premium Default
and Reinstatement.)
Any outstanding Indebtedness will be deducted from the proceeds payable
upon the death of the Insured or the surrender of the Policy. Upon a
complete surrender or lapse of any Policy, if the amount received plus
the amount of outstanding Indebtedness exceeds the total investment in
the Policy, the excess will generally be treated as ordinary income
subject to tax. (See Federal Tax Matters.)
REPAYMENT OF INDEBTEDNESS. A Policy Loan may be repaid in whole or in
part at any time prior to the death of the Insured and as long as a
Policy is in force. When a loan repayment is made, an amount securing
the Indebtedness in the Loan Account equal to the loan repayment will be
transferred to the Divisions of the Separate Account and the General
Account in the same proportion that the Cash Value in each Loan
Subaccount bears to Cash Value in the Loan Account. Amounts paid while
a Policy Loan is outstanding will be treated as premiums unless the
Owner requests in writing that they be treated as repayment of
Indebtedness.
If you fail to make repayments when the total loan and loan interest due
would exceed the cash value, your policy will terminate. We will allow
you a grace period for such payment of loans and loan interest due. If
the loan and loan interest due at the end of the grace period still
exceed the cash value, the policy becomes void at the end of the grace
period. We will mail notice to your last known address, and that of any
assignee of record. This grace period will expire 62 days from the
Monthly Anniversary immediately before the date the total loan and loan
interest exceeds the cash value less any surrender charges, or 31 days
after such notice has been mailed, if later.
SURRENDER AND PRO-RATA SURRENDER
At any time during the lifetime of the Insured and while a Policy is in
force, the Owner may surrender the Policy by sending a written request
to the Company. The amount available for surrender is the Cash
Surrender Value at the end of the Valuation Period during which the
surrender request is received at the Company's Home Office. Amounts
payable from the Separate Account upon surrender or Pro-Rata Surrender
will ordinarily be paid within seven days of receipt of the written
request. (See General Matters - Postponement of Payments from the
Separate Account.)
SURRENDERS. To effect a surrender, either the Policy itself must be
returned to the Company along with the request, or the request must be
accompanied by a completed affidavit of loss, which is available from
the Company. Upon surrender, the Company will pay the Cash Surrender
Value to the Owner in a single sum. The Cash Surrender Value equals the
Cash Value on the date of surrender, plus unearned cost of insurance
charges, less any Indebtedness. The Company will determine the Cash
Surrender Value as of the date that an Owner's written request is
received at the Company's Home Office. Coverage under a Policy will
terminate as of the date of surrender. The Insured must be living at
the time of a surrender. A surrender may have Federal income tax
consequences. (See Federal Tax Matters.)
PRO-RATA SURRENDER. After the first Policy Year, an Owner can make a
Pro-Rata Surrender of the Policy.
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The Pro-Rata Surrender will reduce the death benefit and the Cash Value
by a percentage chosen by the Owner. This percentage may be any whole
number. A Pro-Rata Surrender may have Federal income tax consequences.
(See Federal Tax Matters.) The percentage will be applied to the death
benefit and the Cash Value effective on the date we receive the request.
The Owner may allocate the amount of decrease in Cash Value among the
Divisions of the Separate Account and the General Account. If no
allocation is specified, then the decrease in Cash Value will be
allocated among the Divisions of the Separate Account and the General
Account in the same proportion that the Policy's Cash Value in each
Division and the General Account bears to the total Cash Value of the
Policy, less the Cash Value in the Loan Account, on the date the request
for Pro-Rata Surrender is received.
A Pro-Rata Surrender will not be processed for less than $500 or if it
will reduce the Cash Value below $10,000. No Pro-Rata Surrender will be
processed for more Cash Surrender Value than is available on the date of
the Pro-Rata Surrender. A cash payment will be made to the Owner for
the amount of Cash Value reduction.
TRANSFERS
Under General American's current practices, a Policy's Cash Value,
except amounts credited to the Loan Account, may be transferred among
the Divisions of the Separate Account and between the General Account
and the Separate Account. Transfers to and from the General Account are
subject to restrictions (See The General Account). Requests for
transfers from or among Divisions of the Separate Account may be made in
writing or by telephone. Transfers from or among the Divisions of the
Separate Account must be in amounts of at least $500 or, if smaller, the
Policy's Cash Value in a Division. The first twelve requested transfers
in a policy year will be allowed free of charge. Thereafter, the
Company will impose a charge of $25 for each requested transfer.
General American ordinarily will make transfers and determine all values
in connection with transfers as of the end of the Valuation Period
during which the transfer request is received.
All requests received on the same Valuation Date will be considered a
single transfer request. Each transfer must meet the minimum
requirement of $500 or the entire Cash Value in a Division, whichever is
smaller. Where a single transfer request calls for more than one
transfer, and not all of the transfers would meet the minimum
requirements, General American will make those transfers that do meet
the requirements. Transfers resulting from Policy Loans will not be
counted for purposes of the limitations on the amount or frequency of
transfers allowed in each Policy Month or Policy Year.
Although General American currently intends to continue to permit
transfers for the foreseeable future, the Policy provides that General
American may at any time revoke, modify, or limit the transfer
privilege, including the minimum amount transferable, the maximum
General Account allocation percent, and the frequency of such transfers.
RIGHT TO EXAMINE POLICY
The Owner may cancel a Policy within 20 days after receiving it (30 days
if the Owner is a resident of California and is age 60 or older) or
within 45 days after the application was signed, whichever is later. If
a Policy is canceled within this time period, it will be void from the
beginning. Where permitted, General American will refund the sum of:
1. the difference between the premiums paid and the net premiums
allocated to the Separate Account;
2. the cash values of the Divisions of the Separate Account; and
3. any charges deducted from the Cash Value of the Separate Account.
In such cases, during the Right to Examine period we will invest your
Net Premiums in the Divisions of the Separate Account that the Owner has
selected.
In any jurisdiction in which we are required to refund the total
premiums paid, we will hold the Net Premium in the money market fund
until the end of the Right to Examine period. At the end of the Right
to Examine period, we will transfer the cash value to the Divisions of
the Separate Account that the Owner has selected.
To cancel the Policy, the Owner should mail or deliver the Policy to
either General American or the agent who sold it. A refund of premiums
paid by check may be delayed until the Owner's check has cleared the
bank upon which it was drawn. (See General Matters - Postponement of
Payments from the Separate Account.)
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PAYMENT AND ALLOCATION OF
PREMIUMS
ISSUANCE OF A POLICY
Individuals wishing to purchase a Policy must complete an application
and submit it to an authorized registered agent of General American or
to General American's Home Office. A Policy will generally be issued to
Insureds of Issue Ages 30 through 80 for all risk classes, and to
Insureds of Issue Ages 81 through 90 for non-smokers in the standard
risk class. General American may, in its sole discretion, issue
Policies to individuals falling outside of those Issue Ages. Acceptance
of an application is subject to General American's underwriting rules
and General American reserves the right to reject an application for any
reason.
The Issue Date is determined by General American in accordance with its
standard underwriting procedures for variable life insurance policies.
The Issue Date is used to determine Policy Anniversaries, Policy Years,
and Policy Months. Insurance coverages under a Policy will not take
effect until the Policy has been delivered and the initial premium has
been paid prior to the Insured's death and prior to any change in health
as shown in the application.
PREMIUMS
When applying for the Policy, you determine the amount of the premium
for the first Policy Year and succeeding Policy Years. The amount of
the premiums is shown in the Policy.
The initial premium is due on the Issue Date, and may be paid to an
authorized registered agent of General American or to General American
at its Home Office. Premiums are payable in the amount shown in the
Policy for each Policy Year. You may make each year's scheduled premium
payment in a lump sum or in installments at any time during the Policy
Year.
If a Policy is in the intended Owner's possession but the initial
premium has not been paid, the Policy is not in force. The intended
Owner is deemed to have the Policy for inspection only.
PREMIUM LIMITATIONS. When you apply for the policy, you determine the
amount of the premium that you plan to pay each year. The first year's
scheduled premium must be at least $20,000. The scheduled premium for
future years does not have to be level - it may be different from year
to year to meet your anticipated needs.
After you pay the initial premium, you make future premium payments
according to the schedule that you established. The scheduled premiums
are shown on the policy specifications page. We will send you a bill
based on your schedule. You may make each year's scheduled premium
payment in a lump sum or in installments at any time during the policy
year.
You may not pay more premiums than the amount billed. You may pay less
than the scheduled premium, but there are some important restrictions as
described below.
On each Policy Anniversary we will review the premiums paid into the
policy. If the total amount of premiums paid since the policy's issue
date has always been at least 80% of the total scheduled premiums since
the policy's issue date, then you may pay any amount of premium up to
the current scheduled amount for that Policy Year. If the total amount
of the premiums paid is less than 80% of the total scheduled premium, we
will notify you of the amount of the shortfall and the consequences of
failing to pay at least 80% of the scheduled premium.
There is a period of 62 days from the end of the policy year, called the
"grace period." If you pay a premium during the grace period, and if
you have paid less than the scheduled premium (or less than the
restricted premium, if applicable) for the policy year that just ended,
then we will treat the premium payment as having been made in the prior
policy year. By doing this, we allow you greater flexibility in
deciding how much premium you want to pay in the current policy year.
If the sum of the premium paid during the grace period and the premium
already applied to the prior policy year exceed the amount allowed for
the prior policy year, then we will treat any excess as a premium
payment for the current policy year.
If, on the other hand, a premium remains unpaid after the grace period,
and if the total premium you have paid since the policy's issue date is
less than 80% of the scheduled premiums, then future annual premiums
payable are limited to the lesser of:
1. the scheduled annual premium, or
2. the annual premium paid in the year in which the cumulative
premiums paid fell below 80% of the scheduled cumulative
premium.
If you do not pay the lesser of these two amounts, no further premiums
are payable. We will not accept any more premiums unless they are
necessary to pay the charges under your policy.
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This limit will remain in force for all future years unless you
reinstate the premium schedule as described under Premium Default and
Reinstatement.
The following table shows one example of how a premium schedule could
become restricted:
EXAMPLE: Scheduled premium is $50,000 in each of the first 6 years.
<TABLE>
<CAPTION>
POLICY PREMIUM CUMULATIVE PREMIUM CUMULATIVE CUMULATIVE
YEAR SCHEDULED SCHEDULED PAID PAID PERCENTAGE
<S> <C> <C> <C> <C> <C>
1 $50,000 $50,000 $50,000 $50,000 100.00%
2 $50,000 $100,000 $50,000 $100,000 100.00%
3 $50,000 $150,000 $30,000 $130,000 86.67%
4 $50,000 $200,000 $30,000 $160,000 80.00%
5 $50,000 $250,000 $30,000 $190,000 76.00%
6 $50,000
</TABLE>
In this example, the premium paid in each of the policy years 3-5 is
$30,000. This amount causes the cumulative percentage to fall below
80% following policy year 5. As a result, the premium in future
years is limited to the lesser of $30,000 (the premium paid in the
year in which the cumulate percentage fell below 80%) or the
scheduled premium for the year.
We will deduct certain expenses from your cash value. These expenses
are described below. In addition, your cash value may increase or
decrease, depending on the investment experience of the funds you
select. Because it is possible for your cash value to decrease, your
death benefit may also decrease. If your cash value is insufficient to
pay the charges and deductions, we will allow you to pay sufficient
premium into the policy to cover the current charges and deductions. If
you do not make such premium payments, the policy will terminate without
value.
ALLOCATION OF NET PREMIUMS AND CASH VALUE
ALLOCATION OF NET PREMIUMS. In the application for a Policy, the Owner
indicates how Net Premiums are to be allocated among the Divisions of
the Separate Account, to the General Account (if available), or both.
For each Division chosen, you must allocate a whole percentage of the
Net Premium; fractional percentages may not be used. Certain other
restrictions apply to allocations made to the General Account (see
General Account). For policies issued with an allowable percentage to
the General Account of more than 1%, the minimum percentage is 1%, and
fractional percentages may not be used.
The allocation for future Net Premiums may be changed without charge at
any time by providing notice to the Company. Any change in allocation
will take effect immediately upon receipt by the Company of written
notice. No charge is imposed for changing the allocations of future
premiums. The initial allocation will be shown on the application which
is attached to the Policy. The Company may at any time modify the
maximum percentage of future Net Premiums that may be allocated to the
General Account.
Net Premiums will be allocated according to the allocation instructions
most recently received by the Company unless otherwise instructed for
that particular premium receipt.
The Policy's Cash Value may also be transferred between Divisions of the
Separate Account, and, if the General Account is available under the
Policy, between those Divisions and the General Account. (See Policy
Rights - Transfers.)
The value of amounts allocated to Divisions of the Separate Account will
vary with the investment performance of the chosen Divisions and the
Owner bears the entire investment risk. This will affect both the
Policy's Cash Value and the death benefit. Owners should periodically
review their allocations of Net Premiums and the Policy's Cash Value in
light of market conditions and their overall financial planning
requirements.
PREMIUM DEFAULT AND REINSTATEMENT
PREMIUM DEFAULT. Your premium is in default if you do not pay it on or
before the last day of the Policy Year. We will allow a grace period of
62 days for payment of each premium except the first. The grace period
begins on the last day of the Policy Year for which the premium payment
was due. If you pay a premium during the grace period, and if you have
paid less than the scheduled premium (or less than the restricted
premium, if applicable), we will treat the premium payment as having
been made in the prior Policy Year. If the sum of the premium paid
during the grace period and the premium already applied to
22
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the prior Policy Year exceed the amount allowed for the prior Policy
Year, then we will treat any excess as a premium payment for the current
Policy Year.
If your premium payments have been restricted because you have not paid
at least 80% of the scheduled premiums on a cumulative basis as
described under Premiums, you may apply to reinstate the premium payment
schedule as described below.
You may reinstate your premium payments within three years after the
date of default of a premium payment, provided that you have not
surrendered the policy and that:
1. you submit a written request for reinstatement;
2. you submit proof satisfactory to us that the Insured is
insurable by our standards;
3. you pay all overdue premiums;
4. the Insured is alive on the date we approve the request for
reinstatement. If the insured is not alive, the approval is
void with no effect.
For purposes of reinstatement, the term "all overdue premiums" shown in
item 3 above means the greater of (a) the amount of the originally
scheduled premium for the current Policy Year, or (b) the amount of
premium required so that the total premiums paid since the Issue Date
(without interest) is equal to 80% of the cumulative scheduled premium.
After deducting any applicable Federal Tax Charge and State Tax Charge,
we will allocate the Net Premiums paid under item 3 above into the
General Account or the Divisions of the Separate Account according to
your current allocation instructions.
The Policy with its reinstated premium schedule will be in force from
the date we approve the reinstatement application. There will be a full
monthly deduction for the Policy Month which includes this date. (See
Charges and Deductions - Monthly Deduction.) Any application for
reinstatement becomes part of the contract of reinstatement and of the
Policy.
CHARGES AND DEDUCTIONS
Charges will be deducted in connection with the Policy to compensate the
Company for providing the insurance benefits set forth in the Policy and
any additional benefits added by rider, administering the Policies,
incurring expenses in distributing the Policies, and assuming certain
risks in connection with the Policy.
PREMIUM EXPENSE CHARGES
Prior to allocation of Net Premiums, premium payments will be reduced by
premium expense charges consisting a charge for state taxes and a charge
for Federal taxes. The premium payment less the premium expense charge
equals the Net Premium.
STATE TAX CHARGE. Various states or other governing jurisdictions and
their subdivisions impose a tax on premiums received by insurance
companies. We currently deduct 2.25% of each premium paid to cover the
cost of these taxes. We may adjust this charge if tax rates or
assessments change.
FEDERAL TAX CHARGE. This charge is designed to pass through the
equivalent of the federal tax consequences applicable to the policy.
The charge is currently 1.3% of premium paid, and is guaranteed not to
increase except to the extent of any increases in the federal tax.
INITIAL POLICY CHARGE
INITIAL POLICY CHARGE. The Company has responsibility for the
administration of the Policies and the Separate Account. For
administrative expenses related to the maintenance of each Policy and
the Separate Account, the Company assesses an initial Policy charge of
$800. This amount is deducted from the cash value as soon as we have
issued the Policy and you have made the initial premium payment.
MONTHLY DEDUCTION
Charges will be deducted monthly from the Cash Value of each Policy
("the monthly deduction") to compensate the Company for the cost of
insurance; the cost of optional benefits added by rider, and the
mortality and expense risk and distribution expense assumed by the
Company. The monthly deduction will be taken on the Investment Start
Date and on each Monthly Anniversary. It will be allocated among the
General Account and each Division of the Separate Account in the same
proportion that a Policy's Cash Value in the General Account and the
Policy's Cash Value in each Division bear to the total Cash Value of the
Policy, less the Cash Value in the Loan Account, on the date the
deduction is taken. Because portions of the monthly deduction, such as
the cost of insurance, can vary from month to month, the monthly
deduction itself can vary in amount from month to month.
<PAGE>
The Company may administer the Policy itself, or may purchase
administrative services from such sources (including affiliates) as may
be available.
23
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Such services will be acquired on a basis which, in the Company's sole
discretion, affords the best services at the lowest cost. The Company
reserves the right to select a company to provide services which the
Company deems, in its sole discretion, is the best able to perform such
services in a satisfactory manner even though the costs for such
services may be higher than would prevail elsewhere.
COST OF INSURANCE. The cost of insurance is deducted on each Monthly
Anniversary for the upcoming Policy Month. Because the cost of
insurance depends upon a number of variables, the cost will vary for
each Policy Month. The Company will determine the cost of insurance
charge by multiplying the applicable monthly cost of insurance rate or
rates by the net amount at risk (defined below) for the first day of the
Policy Month.
The cost of insurance rates are determined at the beginning of each
Policy Year. The rates will be based on the Attained Age, rate class,
and sex of the Insured at issue and on the number of completed Policy
Years since the Issue Date. The cost of insurance rates generally
increase as the Insured's Attained Age increases. The monthly cost of
insurance rate is equal to the annual cost of insurance rate divided by
12.
The rate class of an Insured also will affect the cost of insurance
rate. The Company currently places Insureds into a preferred rate
class, a standard rate class, or into rate classes involving a higher
mortality risk.
Actual cost of insurance rates may change, and the rates will be
determined by the Company based on its expectations as to future
mortality experience. However, the actual cost of insurance rates will
not be greater than the guaranteed cost of insurance rates set forth in
the Policy. The guaranteed cost of insurance rates are equal to 100% of
the rates set forth in the male/female smoker/non-smoker 1980 CSO
Mortality Tables (1980 CSO Tables NA and SA and 1980 CSO Tables NG and
SG), for the age nearest birthday. Higher rates may apply if the
Insured is determined to be in a substandard risk class.
In two otherwise identical Policies, an Insured in the preferred rate
class will have a lower cost of insurance than an Insured in a rate
class involving higher mortality risk. Each rate class is also divided
into two categories: smokers and nonsmokers. Nonsmoker Insureds will
generally incur a lower cost of insurance than similarly situated
Insureds who smoke.
The net amount at risk on any date is (a) the death benefit on that date
less (b) the Cash Value on that date.
MORTALITY AND EXPENSE RISK AND DISTRIBUTION CHARGE. General American
will deduct a monthly charge determined as a percentage of the net
assets of the General Account and each Division of the Separate Account.
We calculate the mortality and expense risk and distribution charge and
deduct them from the Policy's Cash Value at the beginning of each Policy
Month. We guarantee that the charge will not exceed the following
amounts, shown on an annual percentage basis:
<TABLE>
<CAPTION>
Total General
and Separate Percentage of Net Assets
Account Funds Distribution Risk Total
------------- ------------ ---- -----
<S> <C> <C> <C>
First $500,000 1.50% 0.75% 2.25%
Next $1,000,000 1.25% 0.75% 2.00%
Next $1,000,000 1.00% 0.75% 1.75%
Next $1,000,000 0.90% 0.75% 1.65%
Next $1,000,000 0.80% 0.75% 1.55%
Next $1,000,000 0.70% 0.75% 1.45%
Next $1,000,000 0.60% 0.75% 1.35%
Over $6,500,000 0.50% 0.75% 1.25%
</TABLE>
The mortality risk assumed by General American is that Insureds may die
sooner than anticipated and that therefore General American will pay an
aggregate amount of death benefits greater than anticipated. The
expense risk assumed is that expenses incurred in issuing and
administering the Policy will exceed the amounts realized from the
administrative charges assessed against the Policy. We may make a
profit from this charge. Any profit may be used to finance distribution
expenses.
ADDITIONAL INSURANCE BENEFITS. The monthly deduction will include
charges for any additional benefits provided by rider. (See General
Matters - Additional Insurance Benefits.)
<PAGE>
TRANSACTION CHARGES. There are no transaction charges for processing
the first twelve transfers in a policy year. There is a charge of $25
for each transfer in excess of twelve.
ADJUSTMENT OF CHARGES. The Policy is available for purchase by
individuals, corporations, and other institutions. For certain
individuals and certain corporate or other group or sponsored
arrangements purchasing one or more Policies, General American may waive
or adjust the amount of any charges where the expenses associated with
the sale of the Policy or Policies or the underwriting or other
administrative costs associated with the Policy or Policies warrant an
adjustment.
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Sales, underwriting, or other administrative expenses may be reduced for
reasons such as expected economies resulting from a corporate purchase
or a group or sponsored arrangement; from the amount of the initial
premium payment or payments; or from the amount of projected premium
payments. General American will determine in its discretion if, and in
what amount, an adjustment is appropriate. The Company may modify its
criteria for qualification for adjustment of charges as experience is
gained, subject to the limitation that such adjustments will not be
unfairly discriminatory against the interests of any Owner.
SEPARATE ACCOUNT CHARGES
FUND EXPENSES. The value of the net assets of the Separate Account will
reflect the investment advisory fee and other expenses incurred by the
underlying investment companies. A summary of the annual Fund operating
expenses for 1998 is provided on page 6 of this prospectus. See the
prospectuses for the respective Funds for a description of investment
advisory fees and other expenses.
TAXES. No charges are currently made to the Separate Account for
Federal, state, or local taxes that the Company incurs which may be
attributable to such Separate Account or to the Policy. The Company may
make such a charge for any such taxes or economic burden resulting from
the application of the tax laws that it determines to be properly
attributable to the Separate Account or to the Policy. (See Federal Tax
Matters.)
THE GENERAL ACCOUNT
Because of exemptive and exclusionary provisions, interests in the
General Account have not been registered under the Securities Act of
1933 and the General Account has not been registered as an investment
company under the 1940 Act. Accordingly, neither the General Account
nor any interests therein are subject to the provisions of these Acts
and, as a result, the staff of the SEC has not reviewed the disclosure
in this Prospectus relating to the General Account. The disclosure
regarding the General Account may, however, be subject to certain
generally applicable provisions of the Federal securities laws relating
to the accuracy and completeness of statements made in prospectuses.
GENERAL DESCRIPTION
The General Account consists of all assets owned by General American
other than those in the Loan Account, the Separate Account and other
separate accounts. Subject to applicable law, General American has sole
discretion over the investment of the assets of the General Account.
At issue, General American will determine the maximum percentage of the
non-borrowed Cash Value that may be allocated, either initially or by
transfer, to the General Account. The ability to allocate Net Premiums
or to transfer Cash Value to the General Account may not be made
available, in the Company's discretion, under certain Policies.
Further, the option may be limited with respect to some Policies. The
Company may, from time to time, adjust the extent to which premiums or
Cash Value may be allocated to the General Account (the "maximum
allocation percentage"). Such adjustments may not be uniform as to all
Policies. General American may at any time modify the General Account
maximum allocation percent. Subject to this maximum, an Owner may elect
to allocate Net Premiums to the General Account, the Separate Account,
or both. Subject to this maximum, the Owner may also transfer Cash
Value from the Divisions of the Separate Account to the General Account,
or from the General Account to the Divisions of the Separate Account.
The allocation of Net Premiums or the transfer of Cash Value to the
General Account does not entitle an Owner to share in the investment
experience of the General Account. Instead, General American guarantees
that Cash Value allocated to the General Account will accrue interest at
a rate of at least 4%, compounded annually, independent of the actual
investment experience of the General Account.
THE POLICY
This Prospectus describes a variable life insurance policy. This
Prospectus is generally intended to serve as a disclosure document only
for the aspects of the Policy relating to the Separate Account. For
complete details regarding the General Account, see the Policy itself.
<PAGE>
GENERAL ACCOUNT BENEFITS
To the extent that the insured is a standard or preferred risk and the
owner invests in the general account, the death benefit associated with
funds invested in the general account can only decrease from policy
anniversary to policy anniversary due to the following causes:
1. charges for benefits provided by any riders,
2. transfers from the general account to the divisions of the
separate account,
3. pro-rata surrenders, and
4. policy loans.
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The amount of the decrease in death benefit is limited to the death
benefit associated with the decrease in general account cash value due
to the causes listed.
GENERAL ACCOUNT CASH VALUE
Net Premiums allocated to the General Account are credited to the Cash
Value. General American bears the full investment risk for these
amounts and guarantees that interest will be credited to each Owner's
Cash Value in the General Account at a rate of no less than 4% per year,
compounded annually. General American may, at its sole discretion,
credit a higher rate of interest, although it is not obligated to credit
interest in excess of 4% per year, and might not do so. Any interest
credited on the Policy's Cash Value in the General Account in excess of
the guaranteed minimum rate of 4% per year will be determined in the
sole discretion of General American. The Policy Owner assumes the risk
that interest credited may not exceed the guaranteed minimum rate of 4%
per year.
The Cash Value of the General Account as of the Investment Start Date is
equal to:
* the portion of the initial net premium received and allocated to
the General Account, minus
* the portion of the monthly deductions due from the Issue Date
through the Investment Start Date charged to the General Account.
Subject to the maximum limit described below, General American
guarantees that, on each Valuation Date, the Cash Value in the General
Account will be:
* the cash value on the preceding Valuation Date, with interest on
such value at the current rate; plus
* any portion of net premium received and allocated to the General
Account on that day; plus
* any amounts transferred to the General Account on that day; plus
* any loan repayments allocated to the General Account on that day;
plus
* that portion of any interest credited on outstanding loans which
is allocated to the General Account on that day; minus
* any amount transferred plus any transfer charge from the General
Account to the Divisions of the Separate Account on that day;
minus
* any amount transferred from the General Account to the Loan
Account on that day; minus
* any withdrawal due to a pro rata surrender made from the General
Account on that day; minus
* if that day is a Monthly Anniversary, the portion of the monthly
deduction charged to the General Account on that day.
The General Account Value immediately after any transfer into the
General Account cannot exceed:
* the General Account Cash Value plus the Separate Account Cash
Value, multiplied by
* the General Account Maximum Allocation Percent as shown on the
Policy specifications page.
TRANSFERS, SURRENDERS AND POLICY LOANS
A portion of Cash Value may be transferred from the General Account to
the Separate Account. Any transfer must be at least $500, or the
Policy's entire Cash Value in the General Account if less than $500.
The total amount of transfers in a Policy Year may not exceed a Maximum
Amount equal to the greater of (a) the Cash Surrender Value in the
General Account at the beginning of the Policy Year, multiplied by the
General Account Maximum Transfer Percent Limit, as shown on the Policy's
specifications page, or (b) the previous Policy Year's Maximum Amount
(not to exceed the total Cash Surrender Value of the Policy).
Transfers to the General Account are limited by the maximum allocation
percentage (described above) in effect for a Policy at the time a
transfer request is made.
Policy Loans may also be made from the Policy's Cash Value in the
General Account.
Loans from the General Account may have Federal income tax consequences.
(See Federal Tax Matters.)
There is no transaction charge for the first twelve requested transfers
in a Policy Year. General American will impose a charge of $25 for each
requested transfer in excess of twelve in a Policy Year. General
American may revoke or modify the privilege of transferring amounts to
or from the General Account at any time.
<PAGE>
Transfers, surrenders and Pro-Rata Surrenders payable from the General
Account and the payment of Policy Loans allocated to the General Account
may, subject to certain limitations, be delayed for up to six months.
However, if payment is deferred for 30 days or more, General American
will pay interest at the rate of 2.5% per year for the period of the
deferment. Amounts from the General Account used to pay premiums on
policies with General American will not be delayed.
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<PAGE>
<PAGE>
GENERAL MATTERS
POSTPONEMENT OF PAYMENTS FROM THE SEPARATE ACCOUNT
The Company usually pays amounts payable on Pro-Rata Surrender,
surrender or Policy Loan allocated to the Separate Account Divisions
within seven days after written notice is received. Payment of any
amount payable from the Divisions of the Separate Account upon
surrender, Pro-Rata Surrender, or death of Insured, as well as payments
of a Policy Loan and transfers, may be postponed whenever: (1) the New
York Stock Exchange is closed other than customary weekend and holiday
closings, or trading on the New York Stock Exchange is restricted as
determined by the SEC; (2) the SEC by order permits postponement for the
protection of Owners; or (3) an emergency exists, as determined by the
SEC, as a result of which disposal of securities is not reasonably
practicable or it is not reasonably practicable to determine the value
of the Separate Account's net assets. The Company may defer payment of
the portion of any Policy Loan from the General Account for not more
than six months.
Payments under the Policy of any amounts derived from premiums paid by
check may be delayed until the Owner's check has cleared the bank upon
which it was drawn.
THE CONTRACT
The Policy, the attached application, any riders, endorsements, and any
application for reinstatement of the scheduled premium constitute the
entire contract. All statements made by the Insured in the application
and any supplemental applications can be used to contest a claim or the
validity of the Policy. Any change to the Policy must be in writing and
approved by the President, a Vice President, or the Secretary of the
Company. No agent has the authority to alter or modify any of the
terms, conditions, or agreements of the Policy or to waive any of its
provisions.
CONTROL OF POLICY
The Insured is the Owner of the Policy unless another person or entity
is shown as the Owner in the application. Ownership may be changed,
however, as described below. The Owner is entitled to all rights
provided by the Policy. Any person whose rights of ownership depend
upon some future event does not possess any present rights of ownership.
If there is more than one Owner at a given time, all Owners must
exercise the rights of ownership by joint action. If the Owner dies,
and the Owner is not the Insured, the Owner's interest in the Policy
becomes the property of his or her estate unless otherwise provided.
Unless otherwise provided, the Policy is jointly owned by all Owners
named in the Policy or by the survivors of those joint Owners. Unless
otherwise stated in the Policy, the final Owner is the estate of the
last joint Owner to die. The Company may rely on the written request of
any trustee of a trust which is the Owner of the Policy, and the Company
is not responsible for the proper administration of any such trust.
BENEFICIARY
The Beneficiary is the person or persons specified in the application or
by later designation. Unless otherwise stated in the Policy, the
Beneficiary has no rights in a Policy before the death of the Insured.
If there is more than one Beneficiary at the death of the Insured, each
Beneficiary will receive equal payments unless otherwise provided by the
Owner. If no Beneficiary is living at the death of the Insured, the
proceeds will be payable to the Owner or, if the Owner is not living, to
the Owner's estate.
The Company permits the designation of various types of trusts as
Beneficiary, including trusts for minor beneficiaries, trusts under a
will, and trusts under a separate written agreement. An Owner is also
permitted to designate several types of beneficiaries, including
business beneficiaries.
CHANGE OF OWNER OR BENEFICIARY
The Owner may change the ownership and/or Beneficiary designation by
written request in a form acceptable to the Company at any time during
the Insured's lifetime subject to any restrictions stated in the Policy
and this Prospectus. The Company may require that the Policy be
returned for endorsement of any change. If acceptable to us, the change
will take effect as of the date the request is signed, whether or not
the Insured is living when the request is received at the Company's Home
Office. The Company is not liable for any payment made or action taken
before the Company received the written request for change. If the
Owner is also a Beneficiary of the Policy at the time of the Insured's
death, the Owner may, within sixty days of the Insured's death,
designate another person to receive the Policy proceeds. Any change
will be subject to any assignment of the Policy or any other legal
restrictions.
POLICY CHANGES
The Company reserves the right to limit the number of changes to a
Policy and to restrict changes in the
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<PAGE>
<PAGE>
first Policy Year. No change will be permitted, if as a result, the
Policy would fail to satisfy the definition of life insurance in Section
7702 of the Internal Revenue Code or any applicable successor provision.
CONFORMITY WITH STATUTES
If any provision in a Policy is in conflict with the laws of the state
governing the Policy, the provision will be deemed to be amended to
conform to such laws. In addition, the Company reserves the right to
change the Policy if it determines that a change is necessary to cause
this Policy to comply with, or give the Owner the benefit of any Federal
or state statute, rule, or regulation, including, but not limited to,
requirements of the Internal Revenue Code, or its regulations or
published rulings.
CLAIMS OF CREDITORS
To the extent permitted by law, neither the Policy nor any payment under
it will be subject to the claims of creditors or to any legal process.
INCONTESTABILITY
The Policy is incontestable after it has been in force for two years
from the Issue Date during the lifetime of the Insured. Any
reinstatement of a premium schedule is incontestable only after it has
been in force during the lifetime of the Insured for two years after the
effective date of the reinstatement.
ASSIGNMENT
The Company will be bound by an assignment of a Policy only if: (a) the
assignment is in writing; (b) the original assignment instrument or a
certified copy thereof is filed with the Company at its Home Office; and
(c) the Company returns an acknowledged copy of the assignment
instrument to the Owner. The Company is not responsible for determining
the validity of any assignment. Payment of Policy proceeds is subject
to the rights of any assignee of record. If a claim is based on an
assignment, the Company may require proof of the interest of the
claimant. A valid assignment will take precedence over the claim of any
Beneficiary.
SUICIDE
Suicide within two years of the Issue Date is not covered by the Policy.
If the Insured dies by suicide, while sane or insane, within two years
from the Issue Date (or within the maximum period permitted by the laws
of the state in which the Policy was delivered, if less than two years),
the amount payable will be limited to premiums paid, less any Pro-Rata
Surrenders and outstanding Indebtedness.
If the Insured is a Missouri citizen when the Policy is issued, this
provision does not apply on the Issue Date of the Policy, unless the
Insured intended suicide when the Policy was applied for.
CONVERSION RIGHTS
While your Policy is in force, you have a one-time right during the
first two Policy Years to transfer all of your Cash Value from the
Divisions of the Separate Account to the General Account.
If at any time during the first two Policy Years, you request in writing
the transfer of the Cash Value held in the Divisions of the Separate
Account to the General Account, and you indicate that you are making
this transfer in exercise of your conversion rights, the transfer will
not be subject to a transfer charge or transfer limits, if any. At the
time of such transfer, there will not be any effect on the Policy's
death benefit, net amount at risk, rate class, or Issue Age.
If you exercise your one-time conversion right, we will automatically
allocate all future net premiums to the General Account. Transfers to
the Divisions of the Separate Account will not be permitted after
exercise of the conversion right.
MISSTATEMENT OF AGE OR SEX AND CORRECTIONS
If the age or sex (except in unisex Policies, see Unisex Requirements
Under Montana Law) of the Insured has been misstated in the application,
the amount of the death benefit will be that which the most recent
Attained Age factor would have purchased for the correct age and sex.
Any payment or Policy changes made by the Company in good faith, relying
on its records or evidence supplied with respect to such payment, will
fully discharge the Company's duty. The Company reserves the right to
correct any errors in the Policy.
ADDITIONAL INSURANCE BENEFITS
Subject to the Company's approval, the owner may obtain additional
insurance coverage in the form of a term rider. The cost of any
additional insurance coverage will be taken as part of the monthly
deduction from the Policy's Cash Value. (See Charges and Deductions -
Monthly Deduction.).
TERM RIDER. The term rider provides level term insurance coverage on
the life of the Insured under
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<PAGE>
<PAGE>
the base policy. The rider can be added only at issue. It cannot be
increased or added to an existing Policy. Certain restrictions may apply
and are described in the rider. An insurance agent authorized to sell
the Policy can describe these extra benefits further. Samples of the
provisions are available from General American upon written request.
RECORDS AND REPORTS
The Company will maintain all records relating to the Separate Account
and will mail to the Owner once each Policy Year, at the last known
address of record, a report which shows the current Policy values,
premiums paid, deductions made since the last report, and any
outstanding Policy Loans. The Owner will also be sent a periodic report
for each Fund. Receipt of premium payments, transfers, Pro-Rata
Surrenders, Policy Loans, loan repayments, surrenders and reinstatements
will be confirmed promptly following each transaction.
DISTRIBUTION OF THE POLICIES
The Policy will be sold by individuals who, in addition to being
licensed as life insurance agents for the Company, are also registered
representatives of Walnut Street Securities, Inc. ("Walnut Street"),
the principal underwriter of the Policy, or of broker-dealers who have
entered into written sales agreements with Walnut Street. Walnut Street
was incorporated under the laws of Missouri in 1984 and is a wholly-
owned subsidiary of General American Holding Company, which is, in turn,
a wholly-owned subsidiary of the Company. Walnut Street is registered
with the SEC under the Securities Exchange Act of 1934 as a broker-
dealer and is a member of the National Association of Securities
Dealers, Inc. No director or officer of Walnut Street owns any units in
the Separate Account.
Writing agents will receive compensation for sales of the Policy. There
is no commission on premiums paid. A service fee, determined as a
percentage of the Policy's Cash Value (excluding amounts in the Loan
Account), ranges from 1.10% of the first $500,000 to 0.375% of amounts
in excess of $6,500,000. Reductions may be possible under the
circumstances outlined in the section entitled Adjustment of Charges.
General Agents receive compensation which is also determined as a
percentage of the Cash Value (excluding amounts in the Loan Account).
As principal underwriter for the Policies, Walnut Street receives
commission income. Walnut Street receives an administrative fee from
sales of the Policies.
General American may use other distribution channels to sell the Policy.
FEDERAL TAX MATTERS
INTRODUCTION
The following summary provides a general description of the Federal
income tax considerations associated with the Policy and does not
purport to be complete or to cover all situations. This discussion is
not intended as tax advice. Counsel or other competent tax Advisors
should be consulted for more complete information. This discussion is
based upon General American's understanding of the present Federal
income tax laws as they are currently interpreted by the Internal
Revenue Service. No representation is made as to the likelihood of
continuation of the present Federal income tax laws or of the current
interpretations by the Internal Revenue Service.
TAX STATUS OF THE POLICY
Section 7702 of the Internal Revenue Code of 1986, as amended (the
"Code") includes a definition of a life insurance contract for Federal
tax purposes. The Secretary of the Treasury (the "Treasury") issued
proposed regulations which specify what will be considered reasonable
mortality charges under Section 7702. Guidance as to how Section 7702
is to be applied is, however, limited. If a Policy were determined not
to be a life insurance contract for purposes of Section 7702, such
Policy would not provide most of the tax advantages normally provided by
a life insurance policy.
With respect to a Policy issued on a basis of a standard premium class
or on a guaranteed or simplified issue basis, while there is some
uncertainty due to the limited guidance under Section 7702, the Company
believes that such a Policy should meet the Section 7702 definition of a
life insurance contract. However, with respect to a Policy issued on a
substandard basis (i.e., a premium class involving higher than standard
mortality risk), it is not clear whether such a Policy would satisfy
Section 7702, particularly if the Owner pays the full amount of premiums
permitted under the Policy.
If it is subsequently determined that a Policy does not satisfy Section
7702, the Company will take whatever steps are appropriate and necessary
to attempt to cause such a Policy to comply with Section 7702, including
possibly refunding any premiums paid that exceed the limitations
allowable under Section 7702 (together with interest or other earnings
on any such premiums refunded as required by law). For these
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reasons, the Company reserves the right to modify the Policy as
necessary to attempt to qualify it as a life insurance contract under
Section 7702.
Section 817(h) of the Code authorizes the Treasury to set standards by
regulation or otherwise for the investments of the Separate Account to
be "adequately diversified" in order for the Policy to be treated as a
life insurance contract for Federal tax purposes. The Separate Account,
intends to comply with the diversification requirements prescribed by
the Treasury in Regulation Section 1.817-5, which affect how assets may
be invested. Although General American does not control the Funds, it
has entered into agreements, which require these investment companies to
be operated in compliance with the requirements prescribed by the
Treasury.
The IRS has stated in published rulings that a variable contract owner
will be considered the owner of separate account assets, for federal
income tax purposes, if the contract owner possesses incidents of
ownership in those assets, such as the ability to exercise investment
control over the assets. If that were to be determined to be the case,
income and gains from the separate account assets would be includable in
the variable contract owner's gross income. The Treasury Department has
also announced, in connection with the issuance of regulations
concerning diversification, that those regulations "do not provide
guidance concerning the circumstances in which investor control of the
investments of a segregated asset account may cause the investor (i.e.,
the Owner), rather than the insurance company, to be treated as the
owner of the assets in the account." This announcement also stated that
guidance would be issued by way of regulations or rulings on the "extent
to which policyholders may direct their investments to particular
subaccounts without being treated as owners of the underlying assets."
The ownership rights under the Policy are different in certain respects
from those described by the IRS in rulings in which it was determined
that policy owners were not owners of separate account assets. For
example, the Owner has additional flexibility in allocating Premium
payments and Policy Values. These differences could result in an Owner
being treated as the owner of a pro rata portion of the assets of the
Separate Account. In addition, the Company does not know what standards
will be set forth, if any, in the regulations or rulings which the
Treasury Department has stated it expects to issue. The Company
therefore reserves the right to modify the Policy as necessary to
attempt to prevent an Owner from being considered the owner of a pro
rata share of the assets of the Separate Account.
The following discussion assumes that the Policy will qualify as a life
insurance contract for Federal income tax purposes.
l. TAX TREATMENT OF POLICY BENEFITS. In general, the Company
believes that the proceeds and Cash Value increases of a Policy should
be treated in a manner consistent with a fixed-benefit life insurance
policy for Federal income tax purposes. Thus, the death benefit under
the Policy should be excludable from the gross income of the Beneficiary
under Section 101(a)(1) of the Code, unless a transfer for value
(generally a sale of the policy) has occurred.
Many changes or transactions involving a Policy may have tax
consequences, depending on the circumstances. Such changes include, but
are not limited to, the exchange of the Policy, a change of the Policy's
Face Amount, a Policy Loan, an additional premium payment, a Policy
lapse with an outstanding Policy Loan, or a surrender of the Policy. In
addition, Federal estate and state and local estate, inheritance, and
other tax consequences of ownership or receipt of Policy proceeds depend
upon the circumstances of each Owner or Beneficiary. A competent tax
adviser should be consulted for further information.
A Policy may also be used in various arrangements, including non-
qualified deferred compensation or salary continuation plans, split
dollar insurance plans, executive bonus plans, retiree medical benefit
plans and others. The tax consequences of such plans may vary depending
on the particular facts and circumstances of each individual
arrangement. Therefore, if you are contemplating the use of a Policy in
any arrangement the value of which depends in part on its tax
consequences, you should be sure to consult a qualified tax adviser
regarding the tax attributes of the particular arrangement.
Generally, the Owner will not be deemed to be in constructive receipt of
the Policy's Cash Value, including increments thereof, under the Policy
until there is a distribution. The tax consequences of distributions
from, and Policy Loans taken from or secured by, a Policy depend upon
whether the Policy is classified as a "modified endowment contract".
However, upon a complete surrender or lapse of any Policy, if the amount
received plus the amount of outstanding Indebtedness exceeds the total
investment in the Policy, the excess will generally be treated as
ordinary income subject to tax.
2. MODIFIED ENDOWMENT CONTRACTS. A policy may be treated as a
modified endowment contract depending upon the amount of premiums paid
in relation to the death benefit provided under such
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Policy. The premium limitation rules for determining whether a Policy
is a modified endowment contract are extremely complex. In general,
however, a Policy will be a modified endowment contract if the
accumulated premiums paid at any time during the first seven Policy
Years exceed the sum of the net level premiums which would have been
paid on or before such time if the Policy provided for paid-up future
benefits after the payment of seven level annual premiums.
In addition, if a Policy is "materially changed" it may cause such
Policy to be treated as a modified endowment contract. The material
change rules for determining whether a Policy is a modified endowment
contract are also extremely complex. In general, however, the
determination of whether a Policy will be a modified endowment contract
after a material change generally depends upon the relationship among
the death benefit at the time of such change, the Cash Value at the time
of the change and the additional premiums paid in the seven Policy Years
starting with the date on which the material change occurs.
Moreover, a life insurance contract received in exchange for a life
insurance contract classified as a modified endowment contract will also
be treated as a modified endowment contract. A reduction in a Policy's
benefits may also cause such Policy to become a modified endowment
contract.
Accordingly, a prospective Owner should contact a competent tax adviser
before purchasing a Policy to determine the circumstances under which
the Policy would be a modified endowment contract. In addition, an
Owner should contact a competent tax adviser before paying any
additional premiums or making any other change to, including an exchange
of, a Policy to determine whether such premium or change would cause the
Policy (or the new Policy in the case of an exchange) to be treated as a
modified endowment contract.
3. DISTRIBUTIONS FROM POLICIES CLASSIFIED AS MODIFIED ENDOWMENT
CONTRACT. Policies classified as modified endowment contracts will be
subject to the following tax rules: First, all distributions, including
distributions upon surrender, from such a Policy are treated as ordinary
income subject to tax up to the amount equal to the excess (if any) of
the Cash Value immediately before the distribution over the investment
in the Policy (described below) at such time. Second, Policy Loans
taken from, or secured by, such a Policy, as well as due but unpaid
interest thereon, are treated as distributions from such a Policy and
taxed accordingly. Third, a 10 percent additional income tax is imposed
on the portion of any distribution from, or Policy Loan taken from or
secured by, such a Policy that (a) is included in income, except where
the distribution or Policy Loan is made on or after the Owner attains
age 59 1/2, (b) is attributable to the Owner's becoming disabled, or (c)
is part of a series of substantially equal periodic payments for the
life (or life expectancy) of the Owner or the joint lives (or joint life
expectancies) of the Owner and the Owner's Beneficiary.
4. DISTRIBUTIONS FROM POLICIES NOT CLASSIFIED AS MODIFIED ENDOWMENT
CONTRACT. Distributions from Policies not classified as a modified
endowment contracts are generally treated as first recovering the
investment in the Policy (described below) and then, only after the
return of all such investment in the Policy, as distributing taxable
income. An exception to this general rule occurs in the case of a
decrease in the Policy's death benefit (possibly including a partial
withdrawal) or any other change that reduces benefits under the Policy
in the first 15 years after the Policy is issued and that results in
cash distribution to the Owner in order for the Policy to continue
complying with the Section 7702 definitional limits. Such a cash
distribution will be taxed in whole or in part as ordinary income (to
the extent of any gain in the Policy) under rules prescribed in Section
7702.
Policy Loans from, or secured by, a Policy that is not a modified
endowment contract are not treated as distributions. Instead, such
loans are treated as indebtedness of the Owner.
Upon a complete surrender or lapse of a Policy that is not a modified
endowment contract, if the amount received plus the amount of
indebtedness exceeds the total investment in the Policy, the excess will
generally be treated as ordinary income subject to tax.
Neither distributions (including distributions upon surrender or lapse)
nor Policy Loans from, or secured by, a Policy that is not a modified
endowment contract are subject to the 10 percent additional income tax.
If a Policy which is not a modified endowment contract subsequently
becomes a modified endowment contract, then any distribution made from
the Policy within two years prior to the date of such change in status
may become taxable.
5. POLICY LOAN INTEREST. Generally, interest paid on any loan under
a life insurance Policy owned by an individual is not deductible. In
addition, interest on any loan under a life insurance Policy owned by a
business taxpayer on the life of any individual who is an officer of or
is financially interested in the business carried on by that taxpayer is
deductible
31
<PAGE>
<PAGE>
only under certain very limited circumstances. AN OWNER SHOULD CONSULT
A COMPETENT TAX ADVISER BEFORE DEDUCTING ANY LOAN INTEREST.
6. INTEREST EXPENSE ON UNRELATED INDEBTEDNESS. Under provisions
added to the Code in 1997 for policies issued after June 8, 1997, if a
business taxpayer owns or is the beneficiary of a Policy on the life of
any individual who is not an officer, director, employee, or 20 percent
owner of the business, and the taxpayer also has debt unrelated to the
Policy, a portion of the taxpayer's unrelated interest expense
deductions may be lost. No business taxpayer should purchase, exchange,
or increase the death benefit under a Policy on the life of any
individual who is not an officer, director, employee, or 20 percent
owner of the business without first consulting a competent tax Advisor.
7. INVESTMENT IN THE POLICY. Investment in the Policy means (i) the
aggregate amount of any premiums or other consideration paid for a
Policy, minus (ii) the aggregate amount received under the Policy which
is excluded from gross income of the Owner (except that the amount of
any Policy Loan from, or secured by, a Policy that is a modified
endowment contract, to the extent such amount is excluded from gross
income, will be disregarded), plus (iii) the amount of any Policy Loan
from, or secured by, a Policy that is a modified endowment contract to
the extent that such amount is included in the gross income of the
Owner.
8. MULTIPLE POLICIES. All modified endowment contracts that are
issued by the Company (or its affiliates) to the same Owner during any
calendar year are treated as one modified endowment contract for
purposes of determining the amount includable in gross income under
Section 72(e) of the Code.
9. POSSIBLE CHARGE FOR TAXES. At the present time, the Company makes
no charge to the Separate Account for any Federal, state, or local taxes
(as opposed to State Tax Charges which are deducted from premium
payments) that it incurs which may be attributable to such Separate
Account or to the Policies. The Company, however, reserves the right in
the future to make a charge for any such tax or other economic burden
resulting from the application of the tax laws that it determines to be
properly attributable to the Separate Account or to the Policies.
UNISEX REQUIREMENTS UNDER
MONTANA LAW
The State of Montana generally prohibits the use of actuarial tables
that distinguish between men and women in determining premiums and
Policy benefits for policies issued on the lives of their residents.
Therefore, all Policies offered by this Prospectus to insure residents
of Montana will have premiums and benefits which are based on actuarial
tables that do not differentiate on the basis of sex.
SAFEKEEPING OF THE SEPARATE
ACCOUNT'S ASSETS
General American holds the assets of the Separate Account in a custodial
account in its name at the Bank of New York. The Company maintains
records of all purchases and redemption of applicable Fund shares by
each of the Divisions. Additional protection for the assets of the
Separate Account is afforded by a blanket fidelity bond issued by
Lloyd's Underwriters in the amount of five million dollars, covering all
officers and employees of the Company who have access to the assets of
the Separate Account.
VOTING RIGHTS
Based on its understanding of current applicable legal requirements, the
Company will vote the shares of the Funds held in the Separate Account
at regular and special shareholder meetings of the mutual funds in
accordance with the instructions received from persons having voting
interests in the corresponding Divisions of the Separate Account. If,
however, the 1940 Act or any regulation thereunder should be amended or
if the present interpretation thereof should change, and as a result the
Company determines that it is permitted to vote shares of the Fund in
its own right, it may elect to do so. No voting privileges apply to the
Policies with respect to Cash Value removed from the Separate Account as
a result of a Policy Loan.
The number of votes which an Owner has the right to instruct will be
calculated separately for each Division. Voting rights reflect the
dollar value of the total number of units of each Division of the
Separate Account credited to the Owner at the record date, rather than
the number of units alone. Fractional shares will be counted. The
number of votes of the Fund which the Owner has the right to instruct
will be determined as of the date coincident with the date established
by that Fund for determining shareholders eligible. Voting instructions
will be solicited by written communications prior to such meeting in
accordance with procedures established by the mutual funds.
The company will vote shares of a Fund for which no timely instructions
are received in proportion to the voting instructions which are received
with respect to
32
<PAGE>
<PAGE>
that Fund. The Company will also vote any shares of the Funds which are
not attributable to Policies in the same proportion.
Each person having a voting interest in a Division will receive any
proxy material, reports, and other materials relating to the appropriate
Fund.
DISREGARD OF VOTING INSTRUCTIONS. The Company may, when required by
state insurance regulatory authorities, disregard voting instructions if
the instructions require that the shares be voted so as to cause a
change in the subclassification or investment objective of the Fund or
to approve or disapprove an investment Advisory contract for a Fund. In
addition, the Company itself may disregard voting instructions in favor
of changes initiated by an Owner in the investment policy or the
investment adviser or sub-adviser of a Fund if the Company reasonably
disapproves of such changes. A proposed change would be disapproved
only if the proposed change is contrary to state law or prohibited by
state regulatory authorities, or the Company determined that the change
would have an adverse effect on its General Account in that the proposed
investment policy for a Fund may result in overly speculative or unsound
investments. If the Company disregards voting instructions, a summary
of that action and the reasons for such action will be included in the
next annual report to Owners.
STATE REGULATION OF THE
COMPANY
General American, a life insurance company organized under the laws of
Missouri, and the Separate Account are subject to regulation by the
Missouri Department of Insurance. An annual statement is filed with the
Director of Insurance on or before March 1st of each year covering the
operations and reporting on the financial condition of the Company as of
December 31 of the preceding year. Periodically, the Director of
Insurance examines the liabilities and reserves of the Company and the
Separate Account and certifies their adequacy, and a full examination of
the Company's operations is conducted by the National Association of
Insurance Commissioners at least once every three years.
In addition, the Company is subject to the insurance laws and
regulations of other states within which it is licensed or may become
licensed to operate. Generally, the insurance departments of other
states apply the laws of the state of domicile in determining
permissible investments.
33
<PAGE>
<PAGE>
<TABLE>
MANAGEMENT OF THE COMPANY
<CAPTION>
PRINCIPAL OCCUPATION (S)
NAME DURING PAST FIVE YEARS<F*>
---- --------------------------
PRINCIPAL OFFICERS <F**>
- ------------------------
<S> <C>
Richard A. Liddy Chairman and CEO, 2/2000-present. Formerly Chairman, President
and CEO, 1/95-present; Chairman of the Executive Committee,
5/92-present. Formerly President and CEO, 5/92-1/95.
Robert J. Banstetter, Sr. Vice President, General Counsel and Secretary, 2/91-present.
John W. Barber Vice President, 12/84-present. Formerly Controller, 12/84-2/00.
Barry C. Cooper Vice President and Controller, 2/00-present.
Kevin C. Eichner President, 2/2000-present. Formerly Executive Vice President
of General American, President and Chairman of GenMark,
Chairman of Walnut Street Securities, 10/97-Present. President
and CEO, Collaborative Strategies, 1983-Present.
E. Thomas Hughes Corporate Actuary and Treasurer, 10/94-present. Formerly
Executive Vice President-Group Pensions, 3/90-10/94
Warren J. Winer Executive Vice President-Group Life and Health, 8/95-present.
Formerly Managing Director, William M. Mercer, Inc.,
7/93-8/95; President and Chief Operating Officer,
W. F. Corroon, 1986-7/93.
Bernard H. Wolzenski Executive Vice President-Individual Insurance, 10/91-present.
A. Greig Woodring President and Chief Executive Officer, Reinsurance Group of
America, 12/92-present.
<FN>
<F*> All positions listed are with General American unless otherwise indicated.
<F**> The principal business address of Messrs. Banstetter, Hughes, and Liddy is General
American Life Insurance Company, 700 Market Street, St. Louis, Missouri 63101. The
principal business address for Messrs. Barber, Winer and Wolzenski is 13045 Tesson Ferry
Road, St. Louis, Missouri 63128. The principal business address for Mr. Woodring is 1370
Timberlake Manor Parkway, Chesterfield, MO 63017. The principal business address for Mr.
Eichner is 670 Mason Ridge Center Drive, Suite 100, St. Louis, Missouri 63141.
34
<PAGE>
<PAGE>
<CAPTION>
PRINCIPAL OCCUPATIONS (S)
NAME DURING PAST FIVE YEARS<F*>
---- --------------------------
DIRECTORS
- ---------
<S> <C>
August A. Busch III Chairman of the Board and President, Anheuser-Busch
Anheuser-Busch Companies, Inc. Companies, Inc. (beer business).
One Busch Place
St. Louis, Missouri 63118
William E. Cornelius Retired Chairman and Chief Executive Officer, Union
Union Electric Company Electric Company (electric utility business).
P.O. Box 149
St. Louis, Missouri 63166
John C. Danforth Partner, Bryan Cave (law firm). Formerly, U. S. Senator,
Bryan Cave State of Missouri.
One Metropolitan Square, Suite 3600
St. Louis, Missouri 63102
Bernard A. Edison Past President, Edison Brothers Stores, Inc. (retail
Edison Brothers Stores, Inc. specialty stores).
P.O. Box 14020
St. Louis, Missouri 63178
Richard A. Liddy Chairman and CEO, General American
General American Life Insurance Co.
700 Market Street
St. Louis, MO 63101
William E. Maritz Chairman and Chief Executive Officer, Maritz, Inc.
Maritz, Inc. (motivation, travel, communications, training and
1375 North Highway Drive marketing research business).
Fenton, Missouri 63099
Craig D. Schnuck Chairman and Chief Executive Officer, Schnuck Markets,
Schnuck Markets, Inc. Inc. (retail supermarket chain).
11420 Lackland Road
P.O. Box 46928
St. Louis, Missouri 63146
William P. Stiritz Chairman, Chief Executive Officer and President,
Agribrands International, Inc. Agribrands International, Inc. Formerly Chairman, Chief
9811 So. Forty Drive Executive Officer and President, Ralston Purina Company
St. Louis, Missouri 63124 (pet food, batteries, and bread business); Chairman,
Ralcorp Holdings, Inc. (ready-to-eat cereal, baby food,
ski resorts).
Andrew C. Taylor Chief Executive Officer and President, Enterprise
Enterprise Rent-A-Car Rent-A-Car (car rental).
600 Corporate Park Drive
St. Louis, Missouri 63105
35
<PAGE>
<PAGE>
<CAPTION>
PRINCIPAL OCCUPATIONS (S)
NAME DURING PAST FIVE YEARS<F*>
---- --------------------------
DIRECTORS (CONTINUED)
- ---------------------
<S> <C>
Robert L. Virgil Principal, Edward Jones (investments).
Edward Jones
12555 Manchester
St. Louis, Missouri 63131-3729
Virginia V. Weldon, M.D. Director, Center for the Study of American Business,
Monsanto Company Washington University. Retired Senior Vice President,
800 North Lindbergh Public Policy, Monsanto Company (chemicals diversified
St. Louis, Missouri 63167 industry, pharmaceuticals, life science products, and
food ingredients business).
Ted C. Wetterau President, Wetterau Associates, L.L.C. Retired Chairman
Wetterau Associates, L.L.C. and Chief Executive Officer, Wetterau Incorporated
7700 Bonhomme, Suite 750 (retail and wholesale grocery, manufacturing business).
St. Louis, Missouri 63105
<FN>
<F*> All positions listed are with General American unless otherwise indicated.
</TABLE>
36
<PAGE>
<PAGE>
LEGAL MATTERS
All matters of Missouri law pertaining to the Policy, including the
validity of the Policy and General American's right to issue the Policy
under Missouri insurance law, have been passed upon by Matthew P.
McCauley, Vice President and Associate General Counsel of General
American.
LEGAL PROCEEDINGS
There are no legal proceedings to which the Separate Account is a party
or to which the assets of the Separate Account are subject. General
American is not involved in any litigation that is of material
importance in relation to its total assets or that relates to the
Separate Account.
EXPERTS
The audited financial statements of General American and the Separate
Account have been included in this Prospectus in reliance on the reports
of KPMG LLP independent certified public accountants, and on the
authority of said firm as experts in accounting and auditing.
Actuarial matters included in this Prospectus have been examined by
Kathryn T. Dowdell, FSA, MAAA, Senior Product Actuary of General
American, as stated in the opinion filed as an exhibit to the
registration statement.
ADDITIONAL INFORMATION
A registration statement has been filed with the Securities and Exchange
Commission, under the Securities Act of 1933, as amended, with respect
to the Policy offered hereby. This Prospectus does not contain all the
information set forth in the registration statement and the amendments
and exhibits to the registration statement, to all of which reference is
made for further information concerning the Separate Account, General
American and the Policy offered hereby. Statements contained in this
Prospectus as to the contents of the Policy and other legal instruments
are summaries. For a complete statement of the terms thereof reference
is made to such instruments as filed.
Like all financial services providers, General American utilizes systems
that may be affected by the Year 2000 transition issues, and it relies
on services providers, including the Funds, that may also be affected.
The Company has developed, and is in the process of implementing, a Year
2000 transition plan, and is confirming that its services providers are
also so engaged. The resources that are being devoted to this effort
are substantial. It is difficult to predict with precision whether the
amount of resources ultimately devoted, or the outcome of these efforts,
will have any negative impact on the Company. However, as of the date
of this prospectus, we do not anticipate that Policy Owners will
experience negative effects on their investment, or on the services
provided in connection therewith, as a result of Year 2000 transition
implementation. General American currently anticipates that its systems
will be Year 2000 compliant, but there can be no assurance that the
Company will be successful, or that interaction with other service
providers will not impair the Company's services at that time.
FINANCIAL STATEMENTS
The financial statements of General American which are included in this
Prospectus should be distinguished from the financial statements of the
Separate Account, and should be considered only as bearing on the
ability of General American to meet its obligations under the Policy.
They should not be considered as bearing on the investment performance
of the assets held in the Separate Account.
37
<PAGE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
General American Life Insurance Company
and Policyholders of General American
Separate Account Eleven:
We have audited the statements of assets and liabilities, including the
schedule of investments, of the S & P 500 Index, Money Market, Bond
Index, Managed Equity, Asset Allocation, International Index, Mid-Cap
Equity, Small-Cap Equity, Equity Income, Growth, Overseas, Asset
Manager, High Income, Worldwide Hard Assets, Worldwide Emerging Markets,
Multi-Style Equity, Core Bond, Aggressive Equity, Non-US, Income &
Growth, International, Value, Bond Portfolio, and Small Company
Portfolio Fund Divisions of General American Separate Account Eleven as
of December 31, 1999, and the related statements of operations and
changes in net assets for each of the years in the three-year period
then ended. These financial statements are the responsibility of the
management of General American Separate Account Eleven. Our
responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. Investments owned as of December 31, 1999 were
verified by audit of the statements of assets and liabilities of the
underlying portfolios of General American Capital Company and
confirmation by correspondence with respect to the Variable Insurance
Products Fund and the Variable Insurance Products Fund II sponsored by
Fidelity Investments, the Van Eck World Wide Insurance Trust sponsored
by Van Eck Associates Corporation, the Russell Insurance Funds sponsored
by Frank Russell Investment Company, the American Century Variable
Portfolios, Inc. sponsored by American Century Investments, and the J.P.
Morgan Series Trust II sponsored by J.P. Morgan Investment Management,
Inc. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the S & P
500 Index, Money Market, Bond Index, Managed Equity, Asset Allocation,
International Index, Mid-Cap Equity, Small-Cap Equity, Equity Income,
Growth, Overseas, Asset Manager, High Income, Worldwide Hard Assets,
Worldwide Emerging Markets, Multi-Style Equity, Core Bond, Aggressive
Equity, Non-US, Income & Growth, International, Value, Bond Portfolio,
and Small Company Portfolio Fund Divisions of General American Separate
Account Eleven as of December 31, 1999, the results of their operations
and changes in their net assets for each of the years in the three-year
period then ended, in conformity with generally accepted accounting
principles.
/s/ KPMG LLP
St. Louis, Missouri
February 25, 2000
<PAGE>
<PAGE>
<TABLE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
S & P 500 MONEY BOND MANAGED ASSET
INDEX MARKET INDEX EQUITY ALLOCATION
FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in General American
Capital Company at market value
(see Schedule of Investments): $60,824,360 $ 9,910,022 $6,136,371 $6,380,710 $18,584,088
Receivable from General American Life
Insurance Company 0 2,220 371 3,358 0
----------- ----------- ---------- ---------- -----------
Total assets 60,824,360 9,912,242 6,136,742 6,384,068 18,584,088
----------- ----------- ---------- ---------- -----------
Liabilities:
Payable to General American Life
Insurance Company 71,634 0 0 0 10,917
----------- ----------- ---------- ---------- -----------
Total net assets $60,752,726 $ 9,912,242 $6,136,742 $6,384,068 $18,573,171
=========== =========== ========== ========== ===========
Total net assets represented by:
Individual Variable Universal Life cash
value invested in Separate Account $12,703,649 $ 1,246,838 $2,527,749 $3,074,531 $12,262,707
Individual Variable General Select Plus
cash value invested in Separate Account 19,187,903 4,130,527 1,146,565 1,061,809 2,069,787
Individual Variable Universal Life-100
cash value invested in Separate Account 21,524,430 1,380,971 1,980,671 1,945,998 2,977,444
Individual Variable Universal Life-98
cash value invested in Separate Account 6,350,278 2,778,076 417,810 264,532 1,116,362
Joint and Survivor Variable Universal Life-98
cash value invested in Separate Account 986,466 375,830 63,947 37,198 146,871
----------- ----------- ---------- ---------- -----------
Total net assets $60,752,726 $ 9,912,242 $6,136,742 $6,384,068 $18,573,171
=========== =========== ========== ========== ===========
Total units held - VUL-95 233,474 68,091 114,933 93,519 293,369
Total units held - VGSP 544,284 309,197 84,706 46,308 83,114
Total units held - VUL-100 651,714 109,972 146,452 86,947 120,924
Total units held - VUL-98 446,086 261,895 42,413 21,648 76,984
Total units held - JSVUL-98 69,296 35,430 6,492 3,044 10,128
VUL-95 Net unit value $ 54.41 $ 18.31 $ 21.99 $ 32.88 $ 41.80
VGSP Net unit value $ 35.25 $ 13.36 $ 13.54 $ 22.93 $ 24.90
VUL-100 Net unit value $ 33.03 $ 12.56 $ 13.52 $ 22.38 $ 24.62
VUL-98 Net unit value $ 14.24 $ 10.61 $ 9.85 $ 12.22 $ 14.50
JSVUL-98 Net unit value $ 14.24 $ 10.61 $ 9.85 $ 12.22 $ 14.50
Cost of investments $48,750,561 $10,202,347 $6,585,233 $6,269,958 $13,925,762
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
INTERNATIONAL MID-CAP SMALL-CAP EQUITY
INDEX EQUITY EQUITY INCOME GROWTH
FUND DIVISION<F*> FUND DIVISION<F**> FUND DIVISION FUND DIVISION FUND DIVISION
----------------- ------------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in General American
Capital Company at market value
(see Schedule of Investments): $13,006,687 $8,364,930 $2,918,058 $ 0 $ 0
Investments in Variable Insurance
Products Fund, at market value
(see Schedule of Investments): 0 0 0 24,166,662 55,713,063
Receivable from General American
Life Insurance Company 0 0 0 0 0
----------- ---------- ---------- ----------- -----------
Total assets 13,006,687 8,364,930 2,918,058 24,166,662 55,713,063
----------- ---------- ---------- ----------- -----------
Liabilities:
Payable to General American Life
Insurance Company 13,075 10,949 514 12,225 338
----------- ---------- ---------- ----------- -----------
Total net assets $12,993,612 $8,353,981 $2,917,544 $24,154,437 $55,712,725
=========== ========== ========== =========== ===========
Total net assets represented by:
Individual Variable Universal Life cash
value invested in Separate Account $ 4,025,567 $3,729,884 $ 558,241 $ 7,440,063 $15,655,055
Individual Variable General Select Plus
cash value invested in Separate Account 1,686,926 2,288,366 1,040,052 8,176,358 17,355,764
Individual Variable Universal Life-100
cash value invested in Separate Account 2,100,227 1,946,132 974,170 7,073,312 18,399,393
Individual Variable Universal Life-98
cash value invested in Separate Account 271,117 341,179 281,822 1,279,572 3,896,211
Joint and Survivor Variable Universal Life-98
cash value invested in Separate Account 65,926 48,420 63,259 185,132 406,302
General American Life Insurance
Company seed money 4,843,849 0 0 0 0
----------- ---------- ---------- ----------- -----------
Total net assets $12,993,612 $8,353,981 $2,917,544 $24,154,437 $55,712,725
=========== ========== ========== =========== ===========
Total units held - VUL-95 168,206 162,788 50,288 286,243 385,323
Total units held - VGSP 81,255 99,514 93,318 312,888 450,926
Total units held - VUL-100 119,341 93,049 87,872 314,896 522,933
Total units held - VUL-98 18,571 25,584 26,642 107,162 232,411
Total units held - JSVUL-98 4,516 3,631 5,980 15,505 24,236
Total units held - Seed Money 200,000 0 0 0 0
VUL-95 Net unit value $ 23.93 $ 22.91 $ 11.10 $ 25.99 $ 40.63
VGSP Net unit value $ 20.76 $ 23.00 $ 11.15 $ 26.13 $ 38.49
VUL-100 Net unit value $ 17.60 $ 20.92 $ 11.09 $ 22.46 $ 35.19
VUL-98 Net unit value $ 14.60 $ 13.34 $ 10.58 $ 11.94 $ 16.76
JSVUL-98 Net unit value $ 14.60 $ 13.34 $ 10.58 $ 11.94 $ 16.76
Cost of investments $ 9,240,024 $7,224,432 $3,357,966 $21,605,411 $37,093,325
<FN>
<F*>This fund was formerly known as the International Equity Fund.
<F**>This fund was formerly known as the Special Equity Fund.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
WORLDWIDE WORLDWIDE
OVERSEAS ASSET MANAGER HIGH INCOME HARD ASSETS EMERGING MARKETS
FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION<F*> FUND DIVISION<F**>
------------- ------------- ------------- ----------------- ------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in Variable Insurance
Products Fund, at market value
(see Schedule of Investments): $15,052,006 $ 0 $4,375,944 $ 0 $ 0
Investments in Variable Insurance
Products Fund II, at market value
(see Schedule of Investments): 0 2,419,380 0 0 0
Investments in Van Eck Worldwide
Insurance Trust at market value
(see Schedule of Investments): 0 0 0 317,077 260,096
Receivable from General American
Life Insurance Company 0 0 0 0 8,698
----------- ---------- ---------- -------- --------
Total assets 15,052,006 2,419,380 4,375,944 317,077 268,794
----------- ---------- ---------- -------- --------
Liabilities:
Payable to General American Life
Insurance Company 655 1,459 3,325 735 0
----------- ---------- ---------- -------- --------
Total net assets $15,051,351 $2,417,921 $4,372,619 $316,342 $268,794
=========== ========== ========== ======== ========
Total net assets represented by:
Individual Variable Universal Life
cash value invested in Separate Account $ 6,592,733 $ 195,708 $ 205,386 $ 88,804 $ 42,630
Individual Variable General Select Plus
cash value invested in Separate Account 5,056,946 444,493 897,255 65,379 151,366
Individual Variable Universal Life-100
cash value invested in Separate Account 2,786,964 1,159,079 2,732,153 151,848 25,825
Individual Variable Universal Life-98
cash value invested in Separate Account 568,261 617,041 470,891 10,311 41,241
Joint and Survivor Variable Universal Life-98
cash value invested in Separate Account 46,447 1,600 66,934 0 7,732
----------- ---------- ---------- -------- --------
Total net assets $15,051,351 $2,417,921 $4,372,619 $316,342 $268,794
=========== ========== ========== ======== ========
Total units held - VUL-95 240,894 10,752 14,177 9,525 2,679
Total units held - VGSP 205,835 24,259 61,511 6,967 9,503
Total units held - VUL-100 130,771 63,821 189,022 16,322 1,623
Total units held - VUL-98 36,151 49,859 41,713 837 1,689
Total units held - JSVUL-98 2,955 129 5,929 0 317
VUL-95 Net unit value $ 27.37 $ 18.20 $ 14.49 $ 9.32 $ 15.91
VGSP Net unit value $ 24.57 $ 18.32 $ 14.59 $ 9.38 $ 15.93
VUL-100 Net unit value $ 21.31 $ 18.16 $ 14.45 $ 9.30 $ 15.91
VUL-98 Net unit value $ 15.72 $ 12.38 $ 11.29 $ 12.32 $ 24.42
JSVUL-98 Net unit value $ 15.72 $ 12.38 $ 11.29 $ 12.32 $ 24.42
Cost of investments $10,501,533 $2,240,585 $4,403,352 $345,171 $216,086
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund.
<F**>This fund began operations on September 15, 1998.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
MULTI-STYLE AGGRESSIVE
EQUITY CORE BOND EQUITY NON-US
FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Assets:
Investments in Russell Insurance
Fund at market value
(see Schedule of Investments): $17,038,971 $ 9,823,042 $4,871,881 $5,011,427
Receivable from General American Life
Insurance Company 0 0 0 0
----------- ----------- ---------- ----------
Total assets 17,038,971 9,823,042 4,871,881 5,011,427
----------- ----------- ---------- ----------
Liabilities:
Payable to General American Life
Insurance Company 46,404 13,372 3,883 12,824
----------- ----------- ---------- ----------
Total net assets $16,992,567 $ 9,809,670 $4,867,998 $4,998,603
=========== =========== ========== ==========
Total net assets represented by:
Individual Variable Universal Life cash
value invested in Separate Account $ 486,907 $ 65,234 $ 181,480 $ 200,109
Individual Variable General Select Plus
cash value invested in Separate Account 10,828,931 7,499,806 2,498,284 2,989,925
Individual Variable Universal Life-100
cash value invested in Separate Account 526,082 81,451 145,500 129,020
Russell Variable Universal Life
cash value invested in Separate Account 4,285,907 1,828,353 1,590,579 1,450,251
Individual Variable Universal Life-98
cash value invested in Separate Account 765,958 272,395 419,622 192,687
Joint and Survivor Variable Universal Life-98
cash value invested in Separate Account 98,782 62,431 32,533 36,611
----------- ----------- ---------- ----------
Total net assets $16,992,567 $ 9,809,670 $4,867,998 $4,998,603
=========== =========== ========== ==========
Total units held - VUL-95 38,212 6,322 19,010 15,191
Total units held - VGSP 567,887 647,045 176,979 195,624
Total units held - VUL-100 41,321 7,901 15,254 9,803
Total units held - Russell VUL 224,387 158,452 111,536 97,420
Total units held - VUL-98 55,512 27,180 34,927 12,805
Total units held - JSVUL-98 7,159 6,230 2,708 2,433
VUL-95 Net unit value $ 12.74 $ 10.32 $ 9.55 $ 13.17
VGSP Net unit value $ 19.07 $ 11.59 $ 14.12 $ 15.28
VUL-100 Net unit value $ 12.73 $ 10.31 $ 9.54 $ 13.16
Russell VUL Net unit value $ 19.10 $ 11.54 $ 14.26 $ 14.89
VUL-98 Net unit value $ 13.80 $ 10.02 $ 12.01 $ 15.05
JSVUL-98 Net unit value $ 13.80 $ 10.02 $ 12.01 $ 15.05
Cost of investments $14,920,743 $10,474,158 $4,552,906 $3,878,857
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<CAPTION>
INCOME & BOND SMALL COMPANY
GROWTH INTERNATIONAL VALUE PORTFOLIO PORTFOLIO
FUND DIVISION<F*> FUND DIVISION<F*> FUND DIVISION<F*> FUND DIVISION<F*> FUND DIVISION<F*>
----------------- ----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in American Century
Variable Portfolios, at market value
(see Schedule of Investments): $736,269 $604,334 $96,178 $ 0 $ 0
Investments in J.P. Morgan Series
Trust II, at market value 0 0 0 141,513 596,119
(see Schedule of Investments):
Receivable from General American
Life Insurance Company 0 0 700 0 1,318
-------- -------- ------- -------- --------
Total assets 736,269 604,334 96,878 141,513 597,437
-------- -------- ------- -------- --------
Liabilities:
Payable to General American Life
Insurance Company 953 140 0 53 0
-------- -------- ------- -------- --------
Total net assets $735,316 $604,194 $96,878 $141,460 $597,437
======== ======== ======= ======== ========
Total net assets represented by:
Individual Variable Universal
Life cash value invested in
Separate Account $ 31,112 $ 15,398 $ 0 $ 3,470 $ 36,948
Individual Variable General
Select Plus cash value invested
in Separate Account 20,209 69,946 7,257 9,120 144,671
Individual Variable Universal
Life-100 cash value invested
in Separate Account 27,018 109,478 0 3,258 51,290
Individual Variable Universal
Life-98 cash value invested
in Separate Account 616,396 390,766 87,054 121,401 319,153
Joint and Survivor Variable
Universal Life-98 cash value
invested in Separate Account 40,581 18,606 2,567 4,211 45,375
-------- -------- ------- -------- --------
Total net assets $735,316 $604,194 $96,878 $141,460 $597,437
======== ======== ======= ======== ========
Total units held - VUL-95 2,800 998 0 353 2,580
Total units held - VGSP 1,817 4,531 795 926 10,091
Total units held - VUL-100 2,432 7,101 0 331 3,582
Total units held - VUL-98 43,920 22,549 8,130 12,134 19,051
Total units held - JVUL-98 2,892 1,074 240 421 2,709
VUL-95 Net unit value $ 11.11 $ 15.42 $ 9.12 $ 9.84 $ 14.32
VGSP Net unit value $ 11.12 $ 15.44 $ 9.13 $ 9.85 $ 14.34
VUL-100 Net unit value $ 11.11 $ 15.42 $ 9.11 $ 9.84 $ 14.32
VUL-98 Net unit value $ 14.03 $ 17.33 $ 10.71 $ 10.00 $ 16.75
JSVUL-98 Net unit value $ 14.03 $ 17.33 $ 10.71 $ 10.00 $ 16.75
Cost of investments $692,594 $483,662 $94,343 $143,528 $499,509
See accompanying notes to the financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
----------- ---------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Investment income<F*> $ -- $ -- $ -- $ -- $ -- $ --
Expenses:
Mortality and expense charges - VUL-95 (101,368) (81,198) (59,320) (7,041) (6,050) (7,951)
Mortality and expense charges - VGSP (127,636) (75,004) (29,674) (24,057) (23,497) (12,872)
Mortality and expense charges - VUL-100 (161,227) (89,773) (36,234) (13,766) (15,324) (13,566)
Mortality and expense charges -
Russell VUL 0 0 0 0 (183) (1,626)
Mortality and expense charges - VUL-98 (12,586) (50) 0 (13,814) (465) 0
Mortality and expense charges - JSVUL-98 (1,944) 0 0 (1,371) (85) 0
----------- ---------- ---------- --------- --------- ---------
Total expenses (404,761) (246,025) (125,228) (60,049) (45,604) (36,015)
----------- ---------- ---------- --------- --------- ---------
Net investment expense (404,761) (246,025) (125,228) (60,049) (45,604) (36,015)
----------- ---------- ---------- --------- --------- ---------
Net realized gain on investments:
Realized gain from distributions 3,826,572 2,339,803 913,559 501,472 263,305 121,801
Realized gain (loss) on sales 2,194,234 802,928 1,570,537 46,905 172,314 (48,325)
----------- ---------- ---------- --------- --------- ---------
Net realized gain on investments: 6,020,806 3,142,731 2,484,096 548,377 435,619 73,476
----------- ---------- ---------- --------- --------- ---------
Net unrealized gain (loss) on investments:
Unrealized gain (loss) on investments,
beginning of period 8,332,257 3,509,114 1,982,215 (183,578) (72,985) (256,852)
Unrealized gain (loss) on investments,
end of period 12,073,799 8,332,257 3,509,114 (292,325) (183,578) (72,985)
----------- ---------- ---------- --------- --------- ---------
Net unrealized gain (loss) on
investments 3,741,542 4,823,143 1,526,899 (108,747) (110,593) 183,867
----------- ---------- ---------- --------- --------- ---------
Net gain on investments 9,762,348 7,965,874 4,010,995 439,630 325,026 257,343
----------- ---------- ---------- --------- --------- ---------
Net increase in net assets
resulting from operations $ 9,357,587 $7,719,849 $3,885,767 $ 379,581 $ 279,422 $ 221,328
=========== ========== ========== ========= ========= =========
<FN>
<F*>See Note 2C
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
--------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
--------- -------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Investment income<F*> $ -- $ -- $ -- $ -- $ -- $ --
Expenses:
Mortality and expense charges - VUL-95 (21,090) (19,385) (14,601) (26,939) (23,907) (20,327)
Mortality and expense charges - VGSP (7,750) (5,292) (3,943) (6,933) (10,512) (4,370)
Mortality and expense charges - VUL-100 (17,629) (8,452) (4,363) (16,278) (5,764) (4,815)
Mortality and expense charges - VUL-98 (2,506) (1) 0 (485) (4) 0
Mortality and expense charges - JSVUL-98 (112) 0 0 (39) 0 0
--------- -------- --------- --------- -------- --------
Total expenses (49,087) (33,130) (22,907) (50,674) (40,187) (29,512)
--------- -------- --------- --------- -------- --------
Net investment expense (49,087) (33,130) (22,907) (50,674) (40,187) (29,512)
--------- -------- --------- --------- -------- --------
Net realized gain (loss) on investments:
Realized gain from distributions 370,745 251,095 165,804 302,748 629,297 251,405
Realized gain (loss) on sales (13,113) 20,497 (176,276) 169,830 71,424 95,532
--------- -------- --------- --------- -------- --------
Net realized gain (loss) on investments: 357,632 271,592 (10,472) 472,578 700,721 346,937
--------- -------- --------- --------- -------- --------
Net unrealized gain (loss) on investments:
Unrealized gain (loss) on investments,
beginning of period 79,646 15,812 (234,659) 436,496 485,000 116,769
Unrealized gain (loss) on investments,
end of period (448,862) 79,646 15,812 110,752 436,496 485,000
--------- -------- --------- --------- -------- --------
Net unrealized gain (loss) on
investments (528,508) 63,834 250,471 (325,744) (48,504) 368,231
--------- -------- --------- --------- -------- --------
Net gain (loss) on investments (170,876) 335,426 239,999 146,834 652,217 715,168
--------- -------- --------- --------- -------- --------
Net increase (decrease) in net assets
resulting from operations $(219,963) $302,296 $ 217,092 $ 96,160 $612,030 $685,656
========= ======== ========= ========= ======== ========
<FN>
<F*>See Note 2C
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
---------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Investment income<F**> $ -- $ -- $ -- $ -- $ -- $ --
Expenses:
Mortality and expense charges - VUL-95 (93,831) (75,604) (67,466) (29,351) (25,562) (23,446)
Mortality and expense charges - VGSP (14,195) (9,318) (7,499) (9,868) (8,370) (5,564)
Mortality and expense charges - VUL-100 (20,890) (12,005) (5,279) (16,070) (11,491) (6,468)
Mortality and expense charges - VUL-98 (1,724) (2) 0 (531) (3) 0
Mortality and expense charges - JSVUL-98 (167) 0 0 (83) 0 0
Mortality and expense charges -
Seed Money 0 0 0 (34,396) (29,672) (27,476)
---------- ---------- ---------- ---------- ---------- ---------
Total expenses (130,807) (96,929) (80,244) (90,299) (75,098) (62,954)
---------- ---------- ---------- ---------- ---------- ---------
Net investment expense (130,807) (96,929) (80,244) (90,299) (75,098) (62,954)
---------- ---------- ---------- ---------- ---------- ---------
Net realized gain on investments:
Realized gain from distributions 287,031 1,145,796 311,438 164,897 120,664 220,590
Realized gain on sales 804,253 230,635 195,821 295,829 220,991 136,741
---------- ---------- ---------- ---------- ---------- ---------
Net realized gain on investments: 1,091,284 1,376,431 507,259 460,726 341,655 357,331
---------- ---------- ---------- ---------- ---------- ---------
Net unrealized gain on investments:
Unrealized gain on investments,
beginning of period 2,336,704 1,762,536 657,734 1,297,560 69,016 268,331
Unrealized gain on investments,
end of period 4,658,326 2,336,704 1,762,536 3,766,663 1,297,560 69,016
---------- ---------- ---------- ---------- ---------- ---------
Net unrealized gain (loss) on
investments 2,321,622 574,168 1,104,802 2,469,103 1,228,544 (199,315)
---------- ---------- ---------- ---------- ---------- ---------
Net gain on investments 3,412,906 1,950,599 1,612,061 2,929,829 1,570,199 158,016
---------- ---------- ---------- ---------- ---------- ---------
Net increase in net assets
resulting from operations $3,282,099 $1,853,670 $1,531,817 $2,839,530 $1,495,101 $ 95,062
========== ========== ========== ========== ========== =========
<FN>
<F*>This fund was formerly known as the International Equity Fund.
<F**>See Note 2C
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997<F***>
---------- --------- ---------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment income<F**> $ -- $ -- $ -- $ -- $ -- $ --
Expenses:
Mortality and expense charges - VUL-95 (28,421) (29,781) (26,828) (4,815) (4,514) (787)
Mortality and expense charges - VGSP (13,677) (13,465) (7,567) (6,607) (4,623) (869)
Mortality and expense charges - VUL-100 (14,697) (11,694) (6,142) (8,869) (5,535) (627)
Mortality and expense charges - VUL-98 (524) (2) 0 (674) (2) 0
Mortality and expense charges - JSVUL-98 (108) (2) 0 (173) (2) 0
---------- --------- ---------- --------- --------- ---------
Total expenses (57,427) (54,944) (40,537) (21,138) (14,676) (2,283)
---------- --------- ---------- --------- --------- ---------
Net investment expense (57,427) (54,944) (40,537) (21,138) (14,676) (2,283)
---------- --------- ---------- --------- --------- ---------
Net realized gain (loss) on investments:
Realized gain from distributions 16,722 208,897 262,603 116,957 112,685 149,353
Realized gain (loss) on sales 239,296 192,934 188,905 (200,146) (67,010) 1,064
---------- --------- ---------- --------- --------- ---------
Net realized gain (loss) on
investments: 256,018 401,831 451,508 (83,189) 45,675 150,417
---------- --------- ---------- --------- --------- ---------
Net unrealized gain (loss) on investments:
Unrealized gain (loss) on investments,
beginning of period 389,305 969,578 24,121 (414,321) (133,375) 0
Unrealized gain (loss) on investments,
end of period 1,140,498 389,305 969,578 (439,908) (414,321) (133,375)
---------- --------- ---------- --------- --------- ---------
Net unrealized gain (loss) on
investments 751,193 (580,273) 945,457 (25,587) (280,946) (133,375)
---------- --------- ---------- --------- --------- ---------
Net gain (loss) on investments 1,007,211 (178,442) 1,396,965 (108,776) (235,271) 17,042
---------- --------- ---------- --------- --------- ---------
Net increase (decrease) in net assets
resulting from operations $ 949,784 $(233,386) $1,356,428 $(129,914) $(249,947) $ 14,759
========== ========= ========== ========= ========= =========
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>See Note 2C
<F***>The Small-Cap Equity Fund began operations on May 1, 1997.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ---------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income $ 314,148 $ 247,254 $ 186,680 $ 64,208 $ 116,859 $ 94,061
Expenses:
Mortality and expense charges - VUL-95 (66,672) (59,688) (49,108) (114,678) (86,045) (65,287)
Mortality and expense charges - VGSP (54,738) (42,329) (27,082) (93,832) (56,854) (37,459)
Mortality and expense charges - VUL-100 (63,116) (63,128) (34,605) (132,573) (84,948) (42,613)
Mortality and expense charges - VUL-98 (3,380) (9) 0 (6,291) (12) 0
Mortality and expense charges - JSVUL-98 (250) (2) 0 (559) 0 0
---------- ---------- ---------- ----------- ----------- ----------
Total expenses (188,156) (165,156) (110,795) (347,933) (227,859) (145,359)
---------- ---------- ---------- ----------- ----------- ----------
Net investment income (expense) 125,992 82,098 75,885 (283,725) (111,000) (51,298)
---------- ---------- ---------- ----------- ----------- ----------
Net realized gain on investments:
Realized gain from distributions 694,432 879,933 938,582 4,037,056 3,056,780 421,033
Realized gain on sales 803,421 1,352,865 310,747 1,981,320 1,016,065 381,175
---------- ---------- ---------- ----------- ----------- ----------
Net realized gain on investments: 1,497,853 2,232,798 1,249,329 6,018,376 4,072,845 802,208
---------- ---------- ---------- ----------- ----------- ----------
Net unrealized gain on investments:
Unrealized gain on investments,
beginning of period 3,031,759 3,330,524 1,528,943 10,185,551 4,728,383 2,039,425
Unrealized gain on investments,
end of period 2,561,251 3,031,759 3,330,524 18,619,738 10,185,551 4,728,383
---------- ---------- ---------- ----------- ----------- ----------
Net unrealized gain (loss) on
investments (470,508) (298,765) 1,801,581 8,434,187 5,457,168 2,688,958
---------- ---------- ---------- ----------- ----------- ----------
Net gain on investments 1,027,345 1,934,033 3,050,910 14,452,563 9,530,013 3,491,166
---------- ---------- ---------- ----------- ----------- ----------
Net increase in net assets
resulting from operations $1,153,337 $2,016,131 $3,126,795 $14,168,838 $ 9,419,013 $3,439,868
========== ========== ========== =========== =========== ==========
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
---------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
---------- -------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income $ 155,887 $163,318 $ 98,942 $ 41,846 $ 21,154 $ 9,219
Expenses:
Mortality and expense charges - VUL-95 (44,402) (38,993) (32,823) (1,503) (806) (219)
Mortality and expense charges - VGSP (25,313) (20,879) (15,095) (2,528) (1,194) (597)
Mortality and expense charges - VUL-100 (19,996) (15,142) (9,246) (9,469) (5,819) (2,776)
Mortality and expense charges - VUL-98 (1,027) (1) 0 (1,934) (4) 0
Mortality and expense charges - JSVUL-98 (102) (2) 0 (4) 0 0
---------- -------- -------- -------- -------- -------
Total expenses (90,840) (75,017) (57,164) (15,438) (7,823) (3,592)
---------- -------- -------- -------- -------- -------
Net investment income 65,047 88,301 41,778 26,408 13,331 5,627
---------- -------- -------- -------- -------- -------
Net realized gain on investments:
Realized gain from distributions 251,431 481,359 392,769 53,005 63,464 23,126
Realized gain on sales 344,512 205,251 73,551 31,755 11,108 10,620
---------- -------- -------- -------- -------- -------
Net realized gain on investments: 595,943 686,610 466,320 84,760 74,572 33,746
---------- -------- -------- -------- -------- -------
Net unrealized gain on investments:
Unrealized gain on investments,
beginning of period 898,037 701,980 639,437 93,508 54,259 19,793
Unrealized gain on investments,
end of period 4,550,473 898,037 701,980 178,795 93,508 54,259
---------- -------- -------- -------- -------- -------
Net unrealized gain on investments 3,652,436 196,057 62,543 85,287 39,249 34,466
---------- -------- -------- -------- -------- -------
Net gain on investments 4,248,379 882,667 528,863 170,047 113,821 68,212
---------- -------- -------- -------- -------- -------
Net increase in net assets
resulting from operations $4,313,426 $970,968 $570,641 $196,455 $127,152 $73,839
========== ======== ======== ======== ======== =======
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSETS
FUND DIVISION FUND DIVISION<F*>
-------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
--------- --------- -------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income $ 282,249 $ 162,896 $ 91,441 $ 3,217 $ 1,564 $ 3,388
Expenses:
Mortality and expense charges - VUL-95 (2,058) (2,432) (2,255) (722) (759) (754)
Mortality and expense charges - VGSP (6,873) (7,426) (4,993) (316) (180) (186)
Mortality and expense charges - VUL-100 (19,402) (10,806) (6,583) (1,242) (1,123) (917)
Mortality and expense charges - VUL-98 (938) (3) 0 (23) 0 0
Mortality and expense charges - JSVUL-98 (284) (2) 0 0 0 0
--------- --------- -------- --------- --------- --------
Total expenses (29,555) (20,669) (13,831) (2,303) (2,062) (1,857)
--------- --------- -------- --------- --------- --------
Net investment income (expense) 252,694 142,227 77,610 914 (498) 1,531
--------- --------- -------- --------- --------- --------
Net realized gain (loss) on investments:
Realized gain from distributions 10,551 103,507 11,302 0 38,415 4,590
Realized gain (loss) on sales (195,235) 17,158 17,736 (40,905) (23,214) (1,380)
--------- --------- -------- --------- --------- --------
Net realized gain (loss) on investments: (184,684) 120,665 29,038 (40,905) 15,201 3,210
--------- --------- -------- --------- --------- --------
Net unrealized gain (loss) on investments:
Unrealized gain (loss) on investments,
beginning of period (198,858) 220,773 57,062 (115,608) (10,760) 3,346
Unrealized gain (loss) on investments,
end of period (27,408) (198,858) 220,773 (28,094) (115,608) (10,760)
--------- --------- -------- --------- --------- --------
Net unrealized gain (loss) on
investments 171,450 (419,631) 163,711 87,514 (104,848) (14,106)
--------- --------- -------- --------- --------- --------
Net gain (loss) on investments (13,234) (298,966) 192,749 46,609 (89,647) (10,896)
--------- --------- -------- --------- --------- --------
Net increase (decrease) in net assets
resulting from operations $ 239,460 $(156,739) $270,359 $ 47,523 $ (90,145) $ (9,365)
========= ========= ======== ========= ========= ========
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
PERIOD AND YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
WORLDWIDE
EMERGING MARKETS MULTI-STYLE EQUITY
FUND DIVISION FUND DIVISION<F**>
------------------- -------------------------------------
1999 1998<F*> 1999 1998 1997
-------- -------- ---------- ---------- -------
<S> <C> <C> <C> <C> <C>
Investment income $ 0 $ 0 $ 104,649 $ 34,444 $ 599
Expenses:
Mortality and expense charges - VUL-95 (32) 0 (3,542) (344) 0
Mortality and expense charges - VGSP (88) 0 (65,628) (27,236) (996)
Mortality and expense charges - VUL-100 (340) 0 (3,741) (164) 0
Mortality and expense charges - Russell VUL 0 0 (19,658) (12,992) (1,582)
Mortality and expense charges - VUL-98 (115) (2) (1,847) (20) 0
Mortality and expense charges - JSVUL-98 (8) 0 (282) (4) 0
------- ----- ---------- ---------- -------
Total expenses (583) (2) (94,698) (40,760) (2,578)
------- ----- ---------- ---------- -------
Net investment income (expense) (583) (2) 9,951 (6,316) (1,979)
------- ----- ---------- ---------- -------
Net realized gain on investments:
Realized gain from distributions 0 0 1,357,954 72,664 0
Realized gain (loss) on sales 29,159 0 281,283 66,462 5,224
------- ----- ---------- ---------- -------
Net realized gain on investments: 29,159 0 1,639,237 139,126 5,224
------- ----- ---------- ---------- -------
Net unrealized gain (loss) on investments:
Unrealized gain on investments,
beginning of period 143 0 1,504,566 1,553 0
Unrealized gain (loss) on investments,
end of period 44,010 143 2,118,228 1,504,566 1,553
------- ----- ---------- ---------- -------
Net unrealized gain (loss) on investments 43,867 143 613,662 1,503,013 1,553
------- ----- ---------- ---------- -------
Net gain (loss) on investments 73,026 143 2,252,899 1,642,139 6,777
------- ----- ---------- ---------- -------
Net increase (decrease) in net assets
resulting from operations $72,443 $ 141 $2,262,850 $1,635,823 $ 4,798
======= ===== ========== ========== =======
<FN>
<F*>The Worldwide Emerging Markets Fund began operations on September 15, 1998.
<F**>The Multi-Style Equity Fund and the Core Bond Fund began operations on January 2, 1997. (continued)
See accompanying notes to the financial statements.
<PAGE>
<CAPTION>
CORE BOND
FUND DIVISION<F**>
----------------------------------
1999 1998 1997
--------- -------- -------
<S> <C> <C> <C>
Investment income $ 476,170 $157,233 $ 2,483
Expenses:
Mortality and expense charges - VUL-95 (500) (84) 0
Mortality and expense charges - VGSP (36,113) (17,465) (408)
Mortality and expense charges - VUL-100 (1,424) (20) 0
Mortality and expense charges - Russell VUL (8,800) (6,579) (1,146)
Mortality and expense charges - VUL-98 (1,426) (2) 0
Mortality and expense charges - JSVUL-98 (118) (2) 0
--------- -------- -------
Total expenses (48,381) (24,152) (1,554)
--------- -------- -------
Net investment income (expense) 427,789 133,081 929
--------- -------- -------
Net realized gain on investments:
Realized gain from distributions 292,845 8,034 0
Realized gain (loss) on sales (62,678) 27,645 705
--------- -------- -------
Net realized gain on investments: 230,167 35,679 705
--------- -------- -------
Net unrealized gain (loss) on investments:
Unrealized gain on investments,
beginning of period 99,544 27,482 0
Unrealized gain (loss) on investments,
end of period (651,116) 99,544 27,482
--------- -------- -------
Net unrealized gain (loss) on investments (750,660) 72,062 27,482
--------- -------- -------
Net gain (loss) on investments (520,493) 107,741 28,187
--------- -------- -------
Net increase (decrease) in net assets
resulting from operations $ (92,704) $240,822 $29,116
========= ======== =======
<FN>
<F**>The Multi-Style Equity Fund and the Core Bond Fund began operations on January 2, 1997. (continued)
See accompanying notes to the financial statements.
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION<F*> FUND DIVISION<F*>
----------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- ------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income $ 13,632 $ 3,204 $ 23 $ 75,751 $ 18,758 $ 0
Expenses:
Mortality and expense charges - VUL-95 (1,191) (233) 0 (1,218) (207) 0
Mortality and expense charges - VGSP (15,730) (9,648) (505) (16,258) (9,418) (496)
Mortality and expense charges - VUL-100 (891) (47) 0 (1,045) (21) 0
Mortality and expense charges -
Russell VUL (6,519) (5,729) (682) (5,664) (3,734) (649)
Mortality and expense charges - VUL-98 (1,111) (18) 0 (458) (3) 0
Mortality and expense charges - JSVUL-98 (84) 0 0 (98) (2) 0
-------- -------- ------- ---------- -------- --------
Total expenses (25,526) (15,675) (1,187) (24,741) (13,385) (1,145)
-------- -------- ------- ---------- -------- --------
Net investment income (expense) (11,894) (12,471) (1,164) 51,010 5,373 (1,145)
-------- -------- ------- ---------- -------- --------
Net realized gain (loss) on investments:
Realized gain from distributions 21,933 103,600 0 104,370 5,331 0
Realized gain (loss) on sales (47,751) (61,039) 2,158 109,735 (18,787) 78
-------- -------- ------- ---------- -------- --------
Net realized gain (loss) on
investments: (25,818) 42,561 2,158 214,105 (13,456) 78
-------- -------- ------- ---------- -------- --------
Net unrealized gain (loss) on investments:
Unrealized gain (loss) on investments,
beginning of period (22,415) 23,627 0 160,666 (57,317) 0
Unrealized gain (loss) on investments,
end of period 318,975 (22,415) 23,627 1,132,570 160,666 (57,317)
-------- -------- ------- ---------- -------- --------
Net unrealized gain (loss) on
investments 341,390 (46,042) 23,627 971,904 217,983 (57,317)
-------- -------- ------- ---------- -------- --------
Net gain (loss) on investments 315,572 (3,481) 25,785 1,186,009 204,527 (57,239)
-------- -------- ------- ---------- -------- --------
Net increase (decrease) in net assets
resulting from operations $303,678 $(15,952) $24,621 $1,237,019 $209,900 $(58,384)
======== ======== ======= ========== ======== ========
<FN>
<F*>The Aggressive Equity Fund and the Non-US Fund began operations on January 2, 1997.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, AND 1998
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE
FUND DIVISION FUND DIVISION FUND DIVISION
--------------------- ---------------------- ----------------------
1999 1998<F*> 1999 1998<F*> 1999 1998<F*>
------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income $ 8 $ 35 $ 0 $ 0 $ 48 $ 0
Expenses:
Mortality and expense charges - VUL-95 (39) 0 (12) 0 0 0
Mortality and expense charges - VGSP (31) 0 (92) 0 (22) 0
Mortality and expense charges - VUL-100 (680) 0 (389) 0 (305) 0
Mortality and expense charges - VUL-98 (1,556) (3) (475) 0 (208) (1)
Mortality and expense charges - JSVUL-98 (58) 0 (21) 0 (6) 0
------- ----- -------- ----- -------- -----
Total expenses (2,364) (3) (989) 0 (541) (1)
------- ----- -------- ----- -------- -----
Net investment income (expense) (2,356) 32 (989) 0 (493) (1)
------- ----- -------- ----- -------- -----
Net realized gain on investments:
Realized gain from distributions 0 0 0 0 450 0
Realized gain (loss) on sales 34,901 12 49,932 5 (14,864) 0
------- ----- -------- ----- -------- -----
Net realized gain (loss) on investments: 34,901 12 49,932 5 (14,414) 0
------- ----- -------- ----- -------- -----
Net unrealized gain on investments:
Unrealized gain on investments,
beginning of period 471 0 45 0 85 0
Unrealized gain on investments,
end of period 43,675 471 120,672 45 1,835 85
------- ----- -------- ----- -------- -----
Net unrealized gain on investments 43,204 471 120,627 45 1,750 85
------- ----- -------- ----- -------- -----
Net gain (loss) on investments 78,105 483 170,559 50 (12,664) 85
------- ----- -------- ----- -------- -----
Net increase (decrease) in net assets
resulting from operations $75,749 $ 515 $169,570 $ 50 $(13,157) $ 84
======= ===== ======== ===== ======== =====
<FN>
<F*>The Income & Growth Fund, International Fund, and Value Fund began operations on September 15, 1998. (continued)
See accompanying notes to the financial statements.
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, AND 1998
<CAPTION>
BOND PORTFOLIO SMALL COMPANY
FUND DIVISION FUND DIVISION
--------------------- ----------------------
1999 1998<F*> 1999 1998<F*>
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Investment income:
Dividend income $ 2,328 $ 0 $ 104 $ 4
Expenses:
Mortality and expense charges - VUL-95 (15) 0 (36) 0
Mortality and expense charges - VGSP (20) 0 (91) 0
Mortality and expense charges - VUL-100 (8) 0 (32) 0
Mortality and expense charges - VUL-98 (171) (1) (519) (4)
Mortality and expense charges - JSVUL-98 (7) 0 (53) 0
------- ----- -------- -----
Total expenses (221) (1) (731) (4)
------- ----- -------- -----
Net investment income (expense) 2,107 (1) (627) 0
------- ----- -------- -----
Net realized gain (loss) on investments:
Realized gain from distributions 40 0 11,337 71
Realized gain (loss) on sales (262) 0 4,540 9
------- ----- -------- -----
Net realized gain (loss) on investments: (222) 0 15,877 80
------- ----- -------- -----
Net unrealized gain (loss) on investments:
Unrealized gain on investments,
beginning of period 3 0 187 0
Unrealized gain (loss) on investments,
end of period (2,015) 3 96,610 187
------- ----- -------- -----
Net unrealized gain (loss) on investments (2,018) 3 96,423 187
------- ----- -------- -----
Net gain (loss) on investments (2,240) 3 112,300 267
------- ----- -------- -----
Net increase (decrease) in net assets
resulting from operations $ (133) $ 2 $111,673 $ 267
======= ===== ======== =====
<FN>
<F*>The Bond Portfolio Fund and Small Company Portfolio Fund began operations on September 15, 1998.
See accompanying notes to the financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
----------- ----------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment expense $ (404,761) $ (246,025) $ (125,228) $ (60,049) $ (45,604) $ (36,015)
Net realized gain on investments 6,020,806 3,142,731 2,484,096 548,377 435,619 73,476
Net unrealized gain (loss) on
investments 3,741,542 4,823,143 1,526,899 (108,747) (110,593) 183,867
----------- ----------- ----------- ---------- ---------- ----------
Net increase in net assets
resulting from operations 9,357,587 7,719,849 3,885,767 379,581 279,422 221,328
Net deposits into (deductions from)
Separate Account 8,977,500 14,119,467 2,209,424 2,797,074 (2,860,090) 932,501
----------- ----------- ----------- ---------- ---------- ----------
Increase (decrease) in net assets 18,335,087 21,839,316 6,095,191 3,176,655 (2,580,668) 1,153,829
Net assets, beginning of period 42,417,639 20,578,323 14,483,132 6,735,587 9,316,255 8,162,426
----------- ----------- ----------- ---------- ---------- ----------
Net assets, end of period $60,752,726 $42,417,639 $20,578,323 $9,912,242 $6,735,587 $9,316,255
=========== =========== =========== ========== ========== ==========
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
--------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment expense $ (49,087) $ (33,130) $ (22,907) $ (50,674) $ (40,187) $ (29,512)
Net realized gain (loss) on investments 357,632 271,592 (10,472) 472,578 700,721 346,937
Net unrealized gain (loss) on
investments (528,508) 63,834 250,471 (325,744) (48,504) 368,231
---------- ---------- ----------- ---------- ---------- ----------
Net increase in net assets
resulting from operations (219,963) 302,296 217,092 96,160 612,030 685,656
Net deposits into (deductions from)
Separate Account 1,249,584 1,356,281 (3,532,130) 761,498 679,065 779,803
---------- ---------- ----------- ---------- ---------- ----------
Increase (decrease) in net assets 1,029,621 1,658,577 (3,315,038) 857,658 1,291,095 1,465,459
Net assets, beginning of period 5,107,121 3,448,544 6,763,582 5,526,410 4,235,315 2,769,856
---------- ---------- ----------- ---------- ---------- ----------
Net assets, end of period $6,136,742 $5,107,121 $ 3,448,544 $6,384,068 $5,526,410 $4,235,315
========== ========== =========== ========== ========== ==========
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
----------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
----------- ----------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment expense $ (130,807) $ (96,929) $ (80,244) $ (90,299) $ (75,098) $ (62,954)
Net realized gain on investments 1,091,284 1,376,431 507,259 460,726 341,655 357,331
Net unrealized gain (loss) on
investments 2,321,622 574,168 1,104,802 2,469,103 1,228,544 (199,315)
----------- ----------- ----------- ----------- ---------- ----------
Net increase in net assets
resulting from operations 3,282,099 1,853,670 1,531,817 2,839,530 1,495,101 95,062
Net deposits into
Separate Account 1,858,100 1,102,997 909,812 237,255 557,433 979,833
----------- ----------- ----------- ----------- ---------- ----------
Increase in net assets 5,140,199 2,956,667 2,441,629 3,076,785 2,052,534 1,074,895
Net assets, beginning of period 13,432,972 10,476,305 8,034,676 9,916,827 7,864,293 6,789,398
----------- ----------- ----------- ----------- ---------- ----------
Net assets, end of period $18,573,171 $13,432,972 $10,476,305 $12,993,612 $9,916,827 $7,864,293
=========== =========== =========== =========== ========== ==========
<FN>
<F*>This fund was formerly known as the International Equity Fund.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
-------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997<F**>
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment expense $ (57,427) $ (54,944) $ (40,537) $ (21,138) $ (14,676) $ (2,283)
Net realized gain (loss) on investments 256,018 401,831 451,508 (83,189) 45,675 150,417
Net unrealized gain (loss) on
investments 751,193 (580,273) 945,457 (25,587) (280,946) (133,375)
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) in net assets
resulting from operations 949,784 (233,386) 1,356,428 (129,914) (249,947) 14,759
Net deposits into (deductions from)
Separate Account 26,099 1,376,768 793,111 672,746 1,480,805 1,129,095
---------- ---------- ---------- ---------- ---------- ----------
Increase in net assets 975,883 1,143,382 2,149,539 542,832 1,230,858 1,143,854
Net assets, beginning of period 7,378,098 6,234,716 4,085,177 2,374,712 1,143,854 0
---------- ---------- ---------- ---------- ---------- ----------
Net assets, end of period $8,353,981 $7,378,098 $6,234,716 $2,917,544 $2,374,712 $1,143,854
========== ========== ========== ========== ========== ==========
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>The Small-Cap Equity Fund began operations on May 1, 1997.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
----------------------------------------- -----------------------------------------
1999 1998 1997 1999 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ 125,992 $ 82,098 $ 75,885 $ (283,725) $ (111,000) $ (51,298)
Net realized gain on investments 1,497,853 2,232,798 1,249,329 6,018,376 4,072,845 802,208
Net unrealized gain (loss) on
investments (470,508) (298,765) 1,801,581 8,434,187 5,457,168 2,688,958
----------- ----------- ----------- ----------- ----------- -----------
Net increase in net assets
resulting from operations 1,153,337 2,016,131 3,126,795 14,168,838 9,419,013 3,439,868
Net deposits into
Separate Account 2,171,008 1,818,144 3,516,214 6,264,467 3,631,816 5,418,111
----------- ----------- ----------- ----------- ----------- -----------
Increase in net assets 3,324,345 3,834,275 6,643,009 20,433,305 13,050,829 8,857,979
Net assets, beginning of period 20,830,092 16,995,817 10,352,808 35,279,420 22,228,591 13,370,612
----------- ----------- ----------- ----------- ----------- -----------
Net assets, end of period $24,154,437 $20,830,092 $16,995,817 $55,712,725 $35,279,420 $22,228,591
=========== =========== =========== =========== =========== ===========
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
--------------------------------------- ------------------------------------
1999 1998 1997 1999 1998 1997
----------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income $ 65,047 $ 88,301 $ 41,778 $ 26,408 $ 13,331 $ 5,627
Net realized gain on investments 595,943 686,610 466,320 84,760 74,572 33,746
Net unrealized gain on investments 3,652,436 196,057 62,543 85,287 39,249 34,466
----------- ---------- ---------- ---------- ---------- --------
Net increase in net assets
resulting from operations 4,313,426 970,968 570,641 196,455 127,152 73,839
Net deposits into
Separate Account 765,467 830,006 2,154,913 984,955 531,902 227,154
----------- ---------- ---------- ---------- ---------- --------
Increase in net assets 5,078,893 1,800,974 2,725,554 1,181,410 659,054 300,993
Net assets, beginning of period 9,972,458 8,171,484 5,445,930 1,236,511 577,457 276,464
----------- ---------- ---------- ---------- ---------- --------
Net assets, end of period $15,051,351 $9,972,458 $8,171,484 $2,417,921 $1,236,511 $577,457
=========== ========== ========== ========== ========== ========
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSETS
FUND DIVISION FUND DIVISION<F*>
-------------------------------------- --------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ---------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ 252,694 $ 142,227 $ 77,610 $ 914 $ (498) $ 1,531
Net realized gain (loss) on investments (184,684) 120,665 29,038 (40,905) 15,201 3,210
Net unrealized gain (loss) on
investments 171,450 (419,631) 163,711 87,514 (104,848) (14,106)
---------- ---------- ---------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations 239,460 (156,739) 270,359 47,523 (90,145) (9,365)
Net deposits into
Separate Account 1,146,113 970,866 711,529 47,731 41,428 92,851
---------- ---------- ---------- -------- -------- --------
Increase (decrease) in net assets 1,385,573 814,127 981,888 95,254 (48,717) 83,486
Net assets, beginning of period 2,987,046 2,172,919 1,191,031 221,088 269,805 186,319
---------- ---------- ---------- -------- -------- --------
Net assets, end of period $4,372,619 $2,987,046 $2,172,919 $316,342 $221,088 $269,805
========== ========== ========== ======== ======== ========
<FN>
<F*>This fund was formerly known as the Gold & Natural Rescources Fund.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
WORLDWIDE
EMERGING MARKETS MULTI-STYLE EQUITY
FUND DIVISION FUND DIVISION<F**>
--------------------- ------------------------------------------
1999 1998<F*> 1999 1998 1997
-------- -------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ (583) $ (2) $ 9,951 $ (6,316) $ (1,979)
Net realized gain on investments 29,159 0 1,639,237 139,126 5,224
Net unrealized gain (loss) on investments 43,867 143 613,662 1,503,013 1,553
-------- ------ ----------- ----------- ----------
Net increase (decrease) in net assets
resulting from operations 72,443 141 2,262,850 1,635,823 4,798
Net deposits into
Separate Account 194,510 1,700 3,014,155 7,540,459 2,534,482
-------- ------ ----------- ----------- ----------
Increase in net assets 266,953 1,841 5,277,005 9,176,282 2,539,280
Net assets, beginning of period 1,841 0 11,715,562 2,539,280 0
-------- ------ ----------- ----------- ----------
Net assets, end of period $268,794 $1,841 $16,992,567 $11,715,562 $2,539,280
======== ====== =========== =========== ==========
<CAPTION>
CORE BOND
FUND DIVISION<F**>
--------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
Operations:
Net investment income (expense) $ 427,789 $ 133,081 $ 929
Net realized gain on investments 230,167 35,679 705
Net unrealized gain (loss) on investments (750,660) 72,062 27,482
---------- ---------- ----------
Net increase (decrease) in net assets
resulting from operations (92,704) 240,822 29,116
Net deposits into
Separate Account 3,244,804 5,262,341 1,125,291
---------- ---------- ----------
Increase in net assets 3,152,100 5,503,163 1,154,407
Net assets, beginning of period 6,657,570 1,154,407 0
---------- ---------- ----------
Net assets, end of period $9,809,670 $6,657,570 $1,154,407
========== ========== ==========
<FN>
<F*>The Worldwide Emerging Markets Fund Fund began operations on September 15,1998.
<F**>The Multi-Style Equity Fund, and Core Bond Fund began operations on January 2, 1997.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION<F*> FUND DIVISION<F*>
-------------------------------------- ------------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ (11,894) $ (12,471) $ (1,164) $ 51,010 $ 5,373 $ (1,145)
Net realized gain (loss) on investments (25,818) 42,561 2,158 214,105 (13,456) 78
Net unrealized gain (loss) on investments 341,390 (46,042) 23,627 971,904 217,983 (57,317)
---------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) in net assets
resulting from operations 303,678 (15,952) 24,621 1,237,019 209,900 (58,384)
Net deposits into
Separate Account 607,124 2,627,723 1,320,804 349,703 2,418,138 842,227
---------- ---------- ---------- ---------- ---------- --------
Increase in net assets 910,802 2,611,771 1,345,425 1,586,722 2,628,038 783,843
Net assets, beginning of period 3,957,196 1,345,425 0 3,411,881 783,843 0
---------- ---------- ---------- ---------- ---------- --------
Net assets, end of period $4,867,998 $3,957,196 $1,345,425 $4,998,603 $3,411,881 $783,843
========== ========== ========== ========== ========== ========
<FN>
<F*>The Aggressive Equity Fund and Non-U.S. Fund began operations on January 2, 1997.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, AND 1998
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE
FUND DIVISION FUND DIVISION FUND DIVISION
--------------------- --------------------- ---------------------
1999 1998<F*> 1999 1998<F*> 1999 1998<F*>
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ (2,356) $ 32 $ (989) $ 0 $ (493) $ (1)
Net realized gain (loss) on investments 34,901 12 49,932 5 (14,414) 0
Net unrealized gain on investments 43,204 471 120,627 45 1,750 85
-------- ------ -------- ---- -------- ------
Net increase (decrease) in net assets
resulting from operations 75,749 515 169,570 50 (13,157) 84
Net deposits into
Separate Account 652,207 6,845 433,721 853 106,165 3,786
-------- ------ -------- ---- -------- ------
Increase in net assets 727,956 7,360 603,291 903 93,008 3,870
Net assets, beginning of period 7,360 0 903 0 3,870 0
-------- ------ -------- ---- -------- ------
Net assets, end of period $735,316 $7,360 $604,194 $903 $ 96,878 $3,870
======== ====== ======== ==== ======== ======
<FN>
<F*>The Income & Growth Fund, International Fund, and Value Fund began operations on September 15, 1998.
See accompanying notes to the financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999, AND 1998
<CAPTION>
BOND PORTFOLIO SMALL COMPANY
FUND DIVISION FUND DIVISION
-------------------- ---------------------
1999 1998<F*> 1999 1998<F*>
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ 2,107 $ (1) $ (627) $ 0
Net realized gain (loss) on investments (222) 0 15,877 80
Net unrealized gain (loss) on investments (2,018) 3 96,423 187
-------- ------ -------- ------
Net increase (decrease) in net assets
resulting from operations (133) 2 111,673 267
Net deposits into
Separate Account 138,293 3,299 482,575 2,922
-------- ------ -------- ------
Increase in net assets 138,160 3,301 594,248 3,189
Net assets, beginning of period 3,301 0 3,189 0
-------- ------ -------- ------
Net assets, end of period $141,461 $3,301 $597,437 $3,189
======== ====== ======== ======
<FN>
<F*>The Bond Portfolio Fund and Small Company Fund began operations on September 15, 1998.
See accompanying notes to the financial statements.
</TABLE>
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
NOTE 1 - ORGANIZATION
General American Separate Account Eleven (the Separate Account)
commenced operations on September 15, 1987 and is registered under the
Investment Company Act of 1940 (1940 Act) as a unit investment trust.
The Separate Account offers six products: Variable Universal Life
(VUL-95), Variable General Select Plus (VGSP), Variable Universal Life
(VUL-100), Russell Variable Universal Life (Russell VUL) Variable
Universal Life (VUL-98), and Joint and Survivor Universal Life (JSVUL-98)
that receive and invest net premiums for flexible premium variable
life insurance policies that are issued by General American Life
Insurance Company (General American). The Separate Account is divided
into twenty-four Divisions. Each Division invests exclusively in shares
of a single Fund of either General American Capital Company, Variable
Insurance Products Fund, Variable Insurance Products Fund II, Van Eck
Worldwide Insurance Trust, Russell Insurance Funds, American Century
Variable Portfolios, Inc. or J.P. Morgan Series Trust II which are
open-end, diversified management companies. The Funds of the General
American Capital Company, sponsored by General American, are the
S & P 500 Index (formerly Equity Index), Money Market, Bond Index, Managed
Equity, Asset Allocation, International Index (formerly International
Equity), Mid-Cap Equity (formerly Special Equity), and the Small-Cap
Equity Fund Divisions. The Funds of the Variable Insurance Products
Fund, managed by Fidelity Management & Research Company, are the Equity
Income, Growth, Overseas, and the High Income Fund Divisions. The Funds
of the Variable Insurance Products Fund II, managed by Fidelity
Management and Research Company is the Asset Manager Fund. The Funds of
the Van Eck Worldwide Insurance Trust, managed by Van Eck Associates
Corporation, are the Worldwide Hard Assets Fund, formerly known as the
Gold and Natural Resources Fund and the Worldwide Emerging Markets Fund
Divisions. The Funds of the Russell Variable Insurance Product, managed
by Frank Russell Investment Management Company are the Multi-style
Equity, Core Bond, Aggressive Equity, and Non-US Fund Divisions. The
Funds of the American Century Variable Portfolios, Inc. managed by
American Century Investments are the Income & Growth, International, and
Value Fund Divisions. The Funds of the J.P. Morgan Trust II, managed by
J.P. Morgan Investment Management, Inc. are the Bond Portfolio and Small
Company Portfolio Fund Divisions. Policyholders have the option of
directing their premium payments into one or all of the Funds as well as
into the general account of General American, which is not generally
subject to regulation under the Securities Act of 1933 or the 1940 Act.
On January 6, 2000, Metropolitan Life Insurance Company (Metlife),
headquartered in New York City, purchased 100% of GenAmerica Corporation
(the Company) for $1.2 billion in cash. The acquisition was a result of
liquidity problems encountered by the Company's wholly-owned subsidiary
General American Life Insurance Company (General American) during 1999.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
by the Separate Account in the preparation of its financial statements.
The policies are in conformity with generally accepted accounting
principles.
A. Investments
The Separate Accounts' investments in the twenty-four Funds are
valued daily based on the net asset values of the respective Fund
shares held as reported to General American by General American
Capital Company, Variable Insurance Products Fund, Variable
Insurance Products Fund II, Van Eck Worldwide Insurance Trust,
Russell Insurance Funds, American Century Portfolios, and J.P.
Morgan Series Trust II. The specific identification method is
used in determining the cost of shares sold on withdrawals by the
Separate Account. Share transactions are recorded on the trade
date, which is the same as the settlement date.
B. Federal Income Taxes
Under current federal income tax law, capital gains from sales of
investments of the Separate Account are not taxable. Therefore,
no federal income tax expense has been provided.
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
C. Distribution of Income and Realized Capital Gains
General American Capital Company follows the federal income tax
practice known as consent dividending, whereby substantially all
of its net investment income and realized gains are deemed to be
passed through to the Separate Account. As a result, General
American Capital Company does not pay any dividends or capital
gain distributions. During December of each year, accumulated
investment income and capital gains of the underlying Capital
Company Fund are allocated to the Separate Account by increasing
the cost basis and recognizing a capital gain in the Separate
Account. The Variable Insurance Products Fund, Variable Insurance
Products Fund II, Van Eck Worldwide Insurance Trust, Russell
Insurance Funds, American Century Variable Portfolios, and J.P.
Morgan Series Trust II intend to pay out all of their net
investment income and net realized capital gains each year.
Dividends from the funds are distributed at least annually on a
per share basis and are recorded on the ex dividend date.
Normally, net realized capital gains, if any, are distributed each
year for each fund. Such income and capital gain distributions
are automatically reinvested in additional shares of the funds.
D. Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of increase and decrease in net assets from
operations during the period. Actual results could differ from
those estimates.
NOTE 3 - POLICY CHARGES
Charges are deducted from premiums and paid to General American for
providing the insurance benefits set forth in the contracts and any
additional benefits added by rider, administering the policies,
reimbursement of expenses incurred in distributing the policies, and
assuming certain risks in connection with the policies.
Prior to the allocation of net premiums among General American's general
account and the Fund Divisions of the Separate Account, premium
payments are reduced by premium expense charges, which consist of a
sales charge and a charge for premium taxes. The premium payment, less
the premium expense charge, equals the net premium.
Sales Charge: A sales charge equal to 6% is deducted from each
-------------
VUL-95 premium paid. A sales charge of 5% in years one through
ten and 2.25% thereafter is deducted from each VGSP premium paid.
A maximum sales charge of 5% in years one through ten and a
maximum 2.25% thereafter based on initial deposit is deducted from
each Russell VUL premium paid. A sales charge equal to 15% up to
the target premium and 5% on the excess in the first policy year
is deducted from each VUL-98 and JSVUL-98 premium paid. The sales
charge is 5% on all premiums in policy years two to twelve, and 2%
on all premiums in policy years eleven or later. This charge is
deducted to partially reimburse General American for expenses
incurred in distributing the policy and any additional benefits
provided by rider. No sales charge is deducted from VUL-100
premiums.
Premium Taxes: Various state and political subdivisions impose a
--------------
tax on premiums received by insurance companies. Premium taxes
vary from state to state. A deduction of 2% of each VUL-95
premium, 2.5% of each VGSP premium, 2.10% of each VUL-100 premium,
2.5% of each Russell VUL premium, and the actual tax rate for VUL-98
and JSVUL-98 is made from each premium payment for these taxes.
In addition, a 1.25% deduction is taken from VUL-100 premiums and
a 1.3% deduction is taken from VUL-98 and JSVUL-98 to cover the
company's Federal income tax costs attributable to the amount of
premium received.
Charges are deducted monthly from the cash value of each policy to
compensate General American for (a) certain administrative costs; (b)
insurance underwriting and acquisition expenses in connection with
issuing a policy; (c) the cost of insurance, and (d) the cost of
optional benefits added by rider.
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
Administrative Charge: General American has responsibility for
----------------------
the administration of the policies and the Separate Account. As
reimbursement for administrative expenses related to the
maintenance of each policy and the Separate Account, General
American assesses a monthly administrative charge against each
policy. This charge is $10 per month for a standard policy and
$12 per month for a pension policy during the first 12 policy
months and $4 (standard) and $6 (pension) per month for all policy
months beyond the 12th for VUL-95 contracts. The charge is $4 per
month for VGSP and Russell VUL contracts. The charge is $13 per
month during the first 12 policy months and $6 per month
thereafter for VUL-100 contracts. The charge is $25 per month in
the first policy year and $6 per month in each subsequent policy
year for VUL-98 and JSVUL-98 contracts.
Insurance Underwriting and Acquisition Expense Charge: An
------------------------------------------------------
additional administrative charge is deducted from the policy cash
value for VUL-95 as part of the monthly deduction during the first
12 policy months and for the first 12 policy months following an
increase in the face amount. The charge is $0.08 per month
multiplied by the face amount divided by 1,000. For VUL-100, the
charge during the first 12 policy months is $0.16 per month
multiplied by the face amount divided by 1,000, and in all policy
years thereafter, the charge is $0.01 per month multiplied by the
face amount divided by 1,000. For VUL-98 and JSVUL-98, there is a
charge per $1,000 of face amount, determined by age, sex, and
smoker class, payable for ten years following the policy issue or
an increase in the face amount.
Cost of Insurance: The cost of insurance is deducted on each
------------------
monthly anniversary date for the following policy month. Because
the cost of insurance depends upon a number of variables, the cost
varies for each policy month. The cost of insurance is
determined separately for the initial face amount and for any
subsequent increases in face amount. General American determines
the monthly cost of insurance charge by multiplying the applicable
cost of insurance rate or rates by the net amount at risk for each
policy month.
Optional Rider Benefits Charge: This monthly deduction includes
-------------------------------
charges for any additional benefits provided by rider.
Contingent Deferred Sales Charge: During the first ten policy
---------------------------------
years for VUL-95, VGSP, and Russell VUL, and the first fifteen
years for VUL-100, General American also assesses a charge upon
surrender or lapse of a policy, a requested decrease in face
amount, or a partial withdrawal that causes the face amount to
decrease. The amount of the charge assessed depends on a number
of factors, including whether the event is a full surrender or
lapse or only a decrease in face amount, the amount of premiums
received to date by General American, and the policy year in which
the surrender or other event takes place. For VUL-98 and JSVUL-
98, the charge is bases on the annual target premium, rather than
the premiums actually received by General American.
Mortality and Expense Charge: In addition to the above charges, a
-----------------------------
daily charge is made at the separate account level for the mortality
and expense risks assumed by General American. General American
deducts a daily charge from the Separate Account at the rate of
.002319% for VUL-95, .0019111% for VGSP, .002455% for VUL-100,
.001366% for Russell VUL, and .0015027% for VUL-98 and JSVUL-98 of
the net assets of each division of the Separate Account, which equals
an annual rate of .85%, .70%, .90%, .50%, .55%, and .55% for VUL-95,
VGSP, VUL-100, Russell VUL, VUL 98, and JSVUL-98, respectively.
VUL-95, VGSP, VUL-100, Russell VUL, VUL-98, and JSVUL-98 mortality
and expense charges for 1999 were $583,872, $528,396, $524,079,
$40,641, $54,323, and $5,931 respectively. The mortality risk
assumed by General American is the risk that those insured may die
sooner than anticipated and therefore, that General American will
pay an aggregate amount of death benefits greater than anticipated.
The expense risk assumed is that expenses incurred in issuing and
administering the policy will exceed the amounts realized from the
administrative charges assessed against the policy.
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
NOTE 4 - INVESTMENT OBJECTIVES, MANAGER CHANGES AND NEW DIVISIONS
Effective April 30, 1998, the four divisions of the Frank Russell funds
became available for Variable Universal Life (VUL-95) and Variable
Universal Life (VUL 100).
On September 15, 1998, six new divisions and two new products - VUL-98
and JSVUL-98 were added to Separate Account Eleven. Three of the new
divisions are the Income & Growth Fund, the International Fund, and the
Value Fund. The underlying funds in these divisions are offered by
American Century Variable Portfolios and managed by American Century
Investments. Two of the new divisions are the Bond Portfolio Fund and
the Small Company Portfolio Fund. The underlying funds in these
divisions are offered by J.P. Morgan Trust II and managed by J.P. Morgan
Investment Management, Inc. The Worldwide Emerging Markets Fund
Division is offered by Van Eck World Wide Insurance Trust and managed by
Van Eck Associates Corporation. The investment objectives of each of
these new divisions are as follows:
Income & Growth Fund - To provide dividend growth, current income and
- --------------------
capital appreciation by investing in common stocks.
International Fund - To provide capital growth by investing primarily in
- ------------------
an internationally diversified portfolio of common stocks that are
considered by management to have prospects for appreciation.
Value Fund - To provide long-term capital growth by investing in
- ----------
securities that management believes to be undervalued at the time of
purchase.
Bond Portfolio Fund - To provide a high total return consistent with
- -------------------
moderate risk of capital and maintenance of liquidity.
Small Company Portfolio Fund - To provide a high total return from a
- ----------------------------
portfolio of equity securities of small companies.
Worldwide Emerging Markets Fund - To provide long-term capital
- -------------------------------
appreciation by investing primarily in equity securities in emerging
markets around the world.
Effective April 30, 1999, the three divisions of the American Century
funds, the two divisions of the J. P. Morgan funds, and the Worldwide
Emerging Markets Division offered by Van Eck Associates became available
for Variable Universal Life (VUL-95), Variable General Select Plus
(VGSP), and Variable Universal Life (VUL-100).
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
NOTE 5 - PURCHASES AND SALES
During the year ended December 31, 1999, purchases including net
realized gain and income from distribution and proceeds from sales of
General American Capital Company shares were as follows:
<TABLE>
<CAPTION>
S & P 500 MONEY BOND MANAGED ASSET INTERNATIONAL MID-CAP SMALL-CAP
INDEX MARKET INDEX EQUITY ALLOCATION INDEX EQUITY EQUITY
FUND FUND FUND FUND FUND FUND FUND FUND
----------- ----------- ---------- ---------- ---------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Purchases $17,996,914 $20,864,176 $2,462,394 $1,821,337 $4,740,174 $1,395,034 $1,564,641 $1,455,784
=========== =========== ========== ========== ========== ========== ========== ==========
Sales $ 5,552,782 $17,520,562 $ 896,592 $ 809,643 $2,550,835 $1,076,698 $1,568,690 $ 678,628
=========== =========== ========== ========== ========== ========== ========== ==========
</TABLE>
During the year ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of Variable Insurance Products
Fund Shares were as follows:
<TABLE>
<CAPTION>
EQUITY INCOME GROWTH OVERSEAS HIGH INCOME
FUND FUND FUND FUND
------------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Purchases $5,903,602 $13,832,577 $2,346,334 $3,304,883
========== =========== ========== ==========
Sales $2,961,663 $ 3,848,234 $1,263,050 $1,892,920
========== =========== ========== ==========
</TABLE>
During the year ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of Variable Insurance Products
Fund II shares were as follows:
<TABLE>
<CAPTION>
ASSET MANAGER
FUND
-------------
<S> <C>
Purchases $1,731,627
==========
Sales $ 664,603
==========
</TABLE>
During the year ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of Van Eck Worldwide Insurance
Trust shares were as follows:
<TABLE>
<CAPTION>
WORLDWIDE WORLDWIDE
HARD ASSETS EMERGING
FUND MARKETS FUND
----------- ------------
<S> <C> <C>
Purchases $122,599 $529,983
======== ========
Sales $ 72,844 $344,809
======== ========
</TABLE>
During the year ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of Russell Insurance Funds shares
were as follows:
<TABLE>
<CAPTION>
MULTI-STYLE CORE BOND AGGRESSIVE NON-US
EQUITY FUND FUND EQUITY FUND FUND
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Purchases $6,023,787 $5,542,508 $1,238,176 $1,216,509
========== ========== ========== ==========
Sales $1,281,297 $1,342,535 $ 630,824 $ 703,797
========== ========== ========== ==========
</TABLE>
<PAGE>
<PAGE>
During the period ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of American Century Variable
Portfolios shares were as follows:
<TABLE>
<CAPTION>
INCOME & INTERNATIONAL
GROWTH FUND FUND VALUE FUND
----------- ------------- ----------
<S> <C> <C> <C>
Purchases $1,164,782 $792,441 $399,886
========== ======== ========
Sales $ 514,040 $359,568 $293,873
========== ======== ========
</TABLE>
During the period ended December 31, 1999, purchases (including dividend
reinvestment) and proceeds from sales of J.P. Morgan Series Trust II
shares were as follows:
<TABLE>
<CAPTION>
SMALL
BOND PORTFOLIO COMPANY
FUND PORTFOLIO FUND
-------------- --------------
<S> <C> <C>
Purchases $154,493 $541,150
======== ========
Sales $ 14,002 $ 49,236
======== ========
</TABLE>
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997:
<TABLE>
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
-------- ------- -------- -------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:
Deposits 40,318 53,610 70,404 56,074 63,693 98,719
Withdrawals (51,800) (44,959) (29,686) (31,779) (66,600) (110,821)
Outstanding units, beginning of year 244,956 236,305 195,587 43,796 46,703 58,805
-------- ------- -------- -------- ---------- --------
Outstanding units, end of year 233,474 244,956 236,305 68,091 43,796 46,703
======== ======= ======== ======== ========== ========
Variable General Select Plus:
Deposits 143,955 313,540 146,632 636,987 1,380,901 942,448
Withdrawals (105,975) (55,730) (305,772) (500,114) (1,744,430) (900,950)
Outstanding units, beginning of year 506,304 248,494 407,634 172,324 535,853 494,355
-------- ------- -------- -------- ---------- --------
Outstanding units, end of year 544,284 506,304 248,494 309,197 172,324 535,853
======== ======= ======== ======== ========== ========
Variable Universal Life - 100:
Deposits 195,193 384,015 212,106 343,675 825,392 738,912
Withdrawals (130,533) (89,826) (41,462) (400,299) (824,924) (707,676)
Outstanding units, beginning of year 587,054 292,865 122,221 166,596 166,128 134,892
-------- ------- -------- -------- ---------- --------
Outstanding units, end of year 651,714 587,054 292,865 109,972 166,596 166,128
======== ======= ======== ======== ========== ========
Russell Variable Universal Life:<F*>
Deposits 0 36,281 435,785
Withdrawals 0 (44,828) (427,238)
Outstanding units, beginning of year 0 8,547 0
-------- ---------- --------
Outstanding units, end of year 0 0 8,547
======== ========== ========
<FN>
<F*>The Russell Variable Universal Life product was introduced in 1997, and the first deposit was received
on May 6, 1997. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, and 1998:
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
---------------------- --------------------------
1999 1998 1999 1998
------- ------ ---------- -------
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F*>
Deposits 493,771 12,188 1,665,714 190,317
Withdrawals (59,617) (256) (1,553,256) (40,880)
Outstanding units, beginning of year 11,932 0 149,437 0
------- ------ ---------- -------
Outstanding units, end of year 446,086 11,932 261,895 149,437
======= ====== ========== =======
Joint and Survivor Variable Universal Life - 98:<F*>
Deposits 93,119 105 206,783 27,427
Withdrawals (23,926) (2) (195,215) (3,565)
Outstanding units, beginning of year 103 0 23,862 0
------- ------ ---------- -------
Outstanding units, end of year 69,296 103 35,430 23,862
======= ====== ========== =======
<FN>
<F*>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products were introduced in 1998,
and the first deposits were received on September 29, 1998 and October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997:
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
----------------------------------- ---------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:
Deposits 19,306 25,406 45,996 12,253 16,942 20,213
Withdrawals (14,321) (12,912) (19,985) (14,768) (13,618) (19,170)
Outstanding units, beginning of year 109,948 97,454 71,443 96,034 92,710 91,667
------- ------- ------- ------- ------- -------
Outstanding units, end of year 114,933 109,948 97,454 93,519 96,034 92,710
======= ======= ======= ======= ======= =======
Variable General Select Plus:
Deposits 23,730 29,830 26,599 11,280 12,156 22,411
Withdrawals (9,825) (9,429) (398,540) (6,022) (8,587) (10,526)
Outstanding units, beginning of year 70,801 50,400 422,341 41,050 37,481 25,596
------- ------- -------- ------- ------- -------
Outstanding units, end of year 84,706 70,801 50,400 46,308 41,050 37,481
======= ======= ======== ======= ======= =======
Variable Universal Life - 100:
Deposits 63,648 84,402 38,781 34,949 40,129 38,918
Withdrawals (30,779) (26,455) (8,471) (16,792) (15,741) (8,793)
Outstanding units, beginning of year 113,583 55,636 25,326 68,790 44,402 14,277
------- ------- -------- ------- ------- -------
Outstanding units, end of year 146,452 113,583 55,636 86,947 68,790 44,402
======= ======= ======== ======= ======= =======
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, and 1998:
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
------------------- -------------------
1999 1998 1999 1998
------- ---- ------ ----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F*>
Deposits 65,154 558 23,377 727
Withdrawals (23,294) (5) (2,443) (13)
Outstanding units, beginning of year 553 0 714 0
------- --- ------ ---
Outstanding units, end of year 42,413 553 21,648 714
======= === ====== ===
Joint and Survivor Variable Universal Life - 98:<F*>
Deposits 6,676 88 3,213 0
Withdrawals (270) (2) (169) 0
Outstanding units, beginning of year 86 0 0 0
------- --- ------ ---
Outstanding units, end of year 6,492 86 3,044 0
======= === ====== ===
<FN>
<F*>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products
were introduced in 1998, and the first deposits were received on September 29, 1998 and
October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997:
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
---------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:
Deposits 36,270 44,015 58,255 24,166 35,296 56,157
Withdrawals (37,511) (32,243) (49,785) (30,239) (36,243) (45,488)
Outstanding units, beginning of year 294,610 282,838 274,368 174,279 175,226 164,557
------- ------- ------- ------- ------- -------
Outstanding units, end of year 293,369 294,610 282,838 168,206 174,279 175,226
======= ======= ======= ======= ======= =======
Variable General Select Plus:
Deposits 62,080 29,160 21,682 15,664 42,140 35,709
Withdrawals (56,513) (24,120) (10,372) (11,959) (34,648) (10,776)
Outstanding units, beginning of year 77,547 72,507 61,197 77,550 70,058 45,125
------- ------- ------- ------- ------- -------
Outstanding units, end of year 83,114 77,547 72,507 81,255 77,550 70,058
======= ======= ======= ======= ======= =======
Variable Universal Life - 100:
Deposits 58,534 49,412 44,721 43,793 54,490 56,601
Withdrawals (25,963) (16,133) (11,617) (41,530) (20,835) (15,926)
Outstanding units, beginning of year 88,353 55,074 21,970 117,078 83,423 42,748
------- ------- ------- ------- ------- -------
Outstanding units, end of year 120,924 88,353 55,074 119,341 117,078 83,423
======= ======= ======= ======= ======= =======
General American Life Insurance Company
seed money:
Deposits 0 0 0
Withdrawals 0 0 0
Outstanding units, beginning of year 200,000 200,000 200,000
------- ------- -------
Outstanding units, end of year 200,000 200,000 200,000
======= ======= =======
<FN>
<F*>This fund was formerly known as the International Equity Fund.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, and 1998:
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
--------------------- -------------------
1999 1998 1999 1998
------ ----- ------ ----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 77,838 1,037 19,887 710
Withdrawals (1,877) (14) (2,009) (17)
Outstanding units, beginning of year 1,023 0 693 0
------ ----- ------ ---
Outstanding units, end of year 76,984 1,023 18,571 693
====== ===== ====== ===
Joint and Survivor Variable Universal Life - 98:<F**>
Deposits 10,560 0 4,680 83
Withdrawals (432) 0 (245) (2)
Outstanding units, beginning of year 0 0 81 0
------ ----- ------ ---
Outstanding units, end of year 10,128 0 4,516 81
====== ===== ====== ===
<FN>
<F*>This fund was formerly known as the International Equity Fund.
<F**>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products
were introduced in 1998, and the first deposits were received on September 29, 1998 and
October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997 for the Mid-Cap Equity
Fund Division and the year ended December 31, 1999, 1998 and period
ended December 31, 1997 for the Small-Cap Equity Fund Division.
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
----------------------------------- ----------------------------------
1999 1998 1997 1999 1998 1997<F**>
------- ------- ------- ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:
Deposits 23,187 33,622 50,013 8,482 19,324 35,503
Withdrawals (35,782) (32,360) (61,032) (7,148) (5,547) (326)
Outstanding units, beginning of period 175,383 174,121 185,140 48,954 35,177 0
------- ------- ------- ------ ------ ------
Outstanding units, end of period 162,788 175,383 174,121 50,288 48,954 35,177
======= ======= ======= ====== ====== ======
Variable General Select Plus:
Deposits 23,177 58,976 43,764 45,417 65,121 30,298
Withdrawals (31,804) (28,754) (14,054) (23,263) (23,984) (271)
Outstanding units, beginning of period 108,141 77,919 48,209 71,164 30,027 0
------- ------- ------- ------ ------ ------
Outstanding units, end of period 99,514 108,141 77,919 93,318 71,164 30,027
======= ======= ======= ====== ====== ======
Variable Universal Life - 100:
Deposits 46,286 56,900 36,664 43,499 70,656 23,110
Withdrawals (40,979) (22,387) (15,674) (38,432) (10,421) (540)
Outstanding units, beginning of period 87,742 53,229 32,239 82,805 22,570 0
------- ------- ------- ------ ------ ------
Outstanding units, end of period 93,049 87,742 53,229 87,872 82,805 22,570
======= ======= ======= ====== ====== ======
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>The Small-Cap Equity Fund began operations on May 1, 1997. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, and 1998:
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
------------------- -------------------
1999 1998 1999 1998
------ ---- ------ ----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 27,940 595 30,720 644
Withdrawals (2,928) (23) (4,697) (25)
Outstanding units, beginning of year 572 0 619 0
------ ---- ------ ---
Outstanding units, end of year 25,584 572 26,642 619
====== ==== ====== ===
Joint and Survivor Variable Universal Life - 98:<F**>
Deposits 4,042 168 6,826 168
Withdrawals (574) (5) (1,009) (5)
Outstanding units, beginning of year 163 0 163 0
------ ---- ------ ---
Outstanding units, end of year 3,631 163 5,980 163
====== ==== ====== ===
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**> The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products were introduced in 1998,
and the first deposits were received on September 29, 1998 and October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997:
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
------------------------------------ ------------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:
Deposits 54,849 59,416 73,369 58,832 69,876 110,237
Withdrawals (72,847) (47,519) (68,932) (78,887) (72,411) (69,361)
Outstanding units, beginning of year 304,241 292,344 287,907 405,378 407,913 367,037
------- ------- ------- ------- ------- -------
Outstanding units, end of year 286,243 304,241 292,344 385,323 405,378 407,913
======= ======= ======= ======= ======= =======
Variable General Select Plus:
Deposits 97,662 99,382 107,293 158,244 99,249 151,169
Withdrawals (67,788) (42,509) (41,943) (93,901) (40,684) (56,898)
Outstanding units, beginning of year 283,014 226,141 160,791 386,583 328,018 233,747
------- ------- ------- ------- ------- -------
Outstanding units, end of year 312,888 283,014 226,141 450,926 386,583 328,018
======= ======= ======= ======= ======= =======
Variable Universal Life - 100:
Deposits 99,022 179,653 161,018 158,445 226,944 227,448
Withdrawals (79,710) (166,343) (42,604) (109,918) (114,919) (64,065)
Outstanding units, beginning of year 295,584 282,274 163,860 474,406 362,381 198,998
------- ------- ------- ------- ------- -------
Outstanding units, end of year 314,896 295,584 282,274 522,933 474,406 362,381
======= ======= ======= ======= ======= =======
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999, and 1998:
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
--------------------- ---------------------
1999 1998 1999 1998
------- ----- ------- -----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F*>
Deposits 113,215 2,270 250,110 3,901
Withdrawals (8,208) (115) (21,492) (108)
Outstanding units, beginning of year 2,155 0 3,793 0
------- ----- ------- -----
Outstanding units, end of year 107,162 2,155 232,411 3,793
======= ===== ======= =====
Joint and Survivor Variable Universal Life - 98:<F*>
Deposits 16,121 247 26,076 79
Withdrawals (856) (7) (1,917) (2)
Outstanding units, beginning of year 240 0 77 0
------- ----- ------- -----
Outstanding units, end of year 15,505 240 24,236 77
======= ===== ======= =====
<FN>
<F*>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products
were introduced in 1998, and the first deposits were received on September 29, 1998 and
October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998, and 1997:
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
----------------------------------- --------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life-95:
Deposits 32,130 46,762 73,211 6,173 7,584 1,053
Withdrawals (38,877) (41,684) (33,419) (4,532) (605) (364)
Outstanding units, beginning of year 247,641 242,563 202,771 9,111 2,132 1,443
------- ------- ------- ------ ------ ------
Outstanding units, end of year 240,894 247,641 242,563 10,752 9,111 2,132
======= ======= ======= ====== ====== ======
Variable General Select Plus:
Deposits 50,014 60,426 78,015 14,236 7,255 4,792
Withdrawals (24,381) (48,932) (24,003) (4,489) (423) (1,323)
Outstanding units, beginning of year 180,202 168,708 114,696 14,512 7,680 4,211
------- ------- ------- ------ ------ ------
Outstanding units, end of year 205,835 180,202 168,708 24,259 14,512 7,680
======= ======= ======= ====== ====== ======
Variable Universal Life-100:
Deposits 47,585 62,350 61,939 34,209 30,521 19,775
Withdrawals (52,739) (27,368) (16,003) (21,189) (9,795) (6,893)
Outstanding units, beginning of year 135,925 100,943 55,007 50,801 30,075 17,193
------- ------- ------- ------ ------ ------
Outstanding units, end of year 130,771 135,925 100,943 63,821 50,801 30,075
======= ======= ======= ====== ====== ======
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999, and 1998:
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
------------------- -------------------
1999 1998 1999 1998
------ ---- ------ ----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F*>
Deposits 39,237 601 53,511 697
Withdrawals (3,669) (18) (4,287) (62)
Outstanding units, beginning of year 583 0 635 0
------ --- ------ ---
Outstanding units, end of year 36,151 583 49,859 635
====== === ====== ===
Joint and Survivor Variable Universal Life - 98:<F*>
Deposits 3,258 168 431 0
Withdrawals (466) (5) (302) 0
Outstanding units, beginning of year 163 0 0 0
------ --- ------ ---
Outstanding units, end of year 2,955 163 129 0
====== === ====== ===
<FN>
<F*>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products
were introduced in 1998, and the first deposits were received on September 29, 1998 and
October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY, (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999, 1998,and 1997:
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSET
FUND DIVISION FUND DIVISION<F*>
----------------------------------- --------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life-95:
Deposits 2,853 6,498 8,197 865 3,234 5,256
Withdrawals (11,513) (2,233) (10,956) (1,622) (3,278) (857)
Outstanding units, beginning of period 22,837 18,572 21,331 10,282 10,326 5,927
------- ------- ------- ------ ------ ------
Outstanding units, end of period 14,177 22,837 18,572 9,525 10,282 10,326
======= ======= ======= ====== ====== ======
Variable General Select Plus:
Deposits 21,266 28,629 36,763 4,811 513 1,994
Withdrawals (47,125) (5,891) (8,788) (312) (937) (3,232)
Outstanding units, beginning of year 87,370 64,632 36,657 2,468 2,892 4,130
------- ------- ------- ------ ------ ------
Outstanding units, end of year 61,511 87,370 64,632 6,967 2,468 2,892
======= ======= ======= ====== ====== ======
Variable Universal Life-100:
Deposits 143,496 57,671 39,145 7,343 8,405 7,159
Withdrawals (64,124) (17,259) (9,470) (6,724) (3,275) (2,531)
Outstanding units, beginning of year 109,650 69,238 39,563 15,703 10,573 5,945
------- ------- ------- ------ ------ ------
Outstanding units, end of year 189,022 109,650 69,238 16,322 15,703 10,573
======= ======= ======= ====== ====== ======
<CAPTION>
WORLDWIDE
EMERGING MARKETS
FUND DIVISION<F**>
--------------------
1999
------
<S> <C>
Variable Universal Life-95:
Deposits 4,159
Withdrawals (1,480)
Outstanding units, beginning of period 0
------
Outstanding units, end of period 2,679
======
Variable General Select Plus:
Deposits 9,565
Withdrawals (62)
Outstanding units, beginning of year 0
------
Outstanding units, end of year 9,503
======
Variable Universal Life-100:
Deposits 11,327
Withdrawals (9,704)
Outstanding units, beginning of year 0
------
Outstanding units, end of year 1,623
======
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund.
<F**>The Worldwide Emerging Markets Fund began operations on September 15, 1998. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999, and 1998:
<CAPTION>
WORLDWIDE
HIGH INCOME WORLDWIDE HARD ASSETS EMERGING MARKETS
FUND DIVISION FUND DIVISION<F**> FUND DIVISION
------------------ --------------------- -------------------
1999 1998 1999 1998 1999 1998<F***>
------ ------ ------ ------- ------ ----------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 98:<F*>
Deposits 44,520 1,163 950 11 1,992 159
Withdrawals (3,941) (29) (124) 0 (453) (9)
Outstanding units, beginning of year 1,134 0 11 0 150 0
------ ----- ---- -- ----- ---
Outstanding units, end of year 41,713 1,134 837 11 1,689 150
====== ===== ==== == ===== ===
Joint and Survivor Variable Universal Life - 98:<F*>
Deposits 6,839 175 345 0
Withdrawals (1,080) (5) (28) 0
Outstanding units, beginning of year 170 0 0 0
------ ----- ----- ---
Outstanding units, end of year 5,929 170 317 0
====== ===== ===== ===
<FN>
<F*>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products were introduced in 1998,
and the first deposits were received on September 29, 1998 and October 14, 1998, respectively.
<F**>This fund was formerly known as the Gold & Natural Resources Fund.
<F***> The Worldwide Emerging Markets Fund began operations on September 15, 1998. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
period ended December 31, 1999, 1998 and 1997:
<CAPTION>
MULTI-STYLE EQUITY CORE BOND
FUND DIVISION<F*> FUND DIVISION<F*>
----------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------- ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:<F**>
Deposits 25,719 15,537 0 2,587 4,116 0
Withdrawals (2,365) (679) 0 (335) (46) 0
Outstanding units, beginning of period 14,858 0 0 4,070 0 0
------- ------- ------- ------- ------- ------
Outstanding units, end of period 38,212 14,858 0 6,322 4,070 0
======= ======= ======= ======= ======= ======
Variable General Select Plus:<F***>
Deposits 167,069 456,763 47,597 310,229 450,004 21,805
Withdrawals (72,422) (30,453) (667) (60,786) (73,816) (391)
Outstanding units, beginning of period 473,240 46,930 0 397,602 21,414 0
------- ------- ------- ------- ------- ------
Outstanding units, end of period 567,887 473,240 46,930 647,045 397,602 21,414
======= ======= ======= ======= ======= ======
Variable Universal Life - 100:<F****>
Deposits 56,809 8,637 0 39,861 807 0
Withdrawals (22,765) (1,360) 0 (32,644) (123) 0
Outstanding units, beginning of year 7,277 0 0 684 0 0
------- ------- ------- ------- ------- ------
Outstanding units, end of year 41,321 7,277 0 7,901 684 0
======= ======= ======= ======= ======= ======
Russell Variable Universal Life: <F*****>
Deposits 9,282 81,464 153,054 3,615 91,724 86,149
Withdrawals (8,686) (9,164) (1,563) (10,478) (10,534) (2,024)
Outstanding units, beginning of period 223,791 151,491 0 165,315 84,125 0
------- ------- ------- ------- ------- ------
Outstanding units, end of period 224,387 223,791 151,491 158,452 165,315 84,125
======= ======= ======= ======= ======= ======
<FN>
<F*>The Multi-style Equity Fund and Core Bond Fund began operations on January 2, 1997.
<F**>The Variable Universal Life - 95 product was introduced to the Frank Russell funds on April 30, 1998, and the first deposit
was received on May 14, 1998.
<F***>The Variable General Select Plus product was introduced in 1997, and the first deposit was received on June 26, 1997.
<F****>The Variable Universal Life - 100 product was introduced to the Frank Russell funds on April 30, 1998, and the first deposit
was received on May 22, 1998.
<F*****>The Russell Variable Universal Life product was introduced in 1997, and the first deposit was received on June 6, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999, and 1998:
<CAPTION>
MULTI-STYLE EQUITY CORE BOND
FUND DIVISION<F*> FUND DIVISION<F*>
--------------------- ---------------------
1999 1998 1999 1998
------ ----- ------ -----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 59,760 4,052 36,182 788
Withdrawals (8,199) (101) (9,781) (9)
Outstanding units, beginning of year 3,951 0 779 0
------ ----- ------ ---
Outstanding units, end of year 55,512 3,951 27,180 779
====== ===== ====== ===
Joint and Survivor Variable Universal Life - 98:<F**>
Deposits 7,599 410 6,321 169
Withdrawals (838) (12) (255) (5)
Outstanding units, beginning of year 398 0 164 0
------ ----- ------ ---
Outstanding units, end of year 7,159 398 6,230 164
====== ===== ====== ===
<FN>
<F*>The Multi-style Equity Fund and Core Bond Fund began operations on January 2, 1997.
<F**>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products were introduced in 1998,
and the first deposits were received on September 29, 1998 and October 14, 1998, respectively. (continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
period ended December 31, 1999, 1998 and 1997:
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION<F*> FUND DIVISION<F*>
---------------------------------- ---------------------------------
1999 1998 1997 1999 1998 1997
------- ------- ------ ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 95:<F**>
Deposits 6,833 14,484 0 7,044 10,028 0
Withdrawals (1,715) (592) 0 (1,673) (208) 0
Outstanding units, beginning of period 13,892 0 0 9,820 0 0
------- ------- ------ ------- ------- ------
Outstanding units, end of period 19,010 13,892 0 15,191 9,820 0
======= ======= ====== ======= ======= ======
Variable General Select Plus:<F***>
Deposits 62,730 192,091 25,379 33,941 188,887 28,863
Withdrawals (59,340) (43,602) (279) (26,047) (29,735) (285)
Outstanding units, beginning of period 173,589 25,100 0 187,730 28,578 0
------- ------- ------ ------- ------- ------
Outstanding units, end of period 176,979 173,589 25,100 195,624 187,730 28,578
======= ======= ====== ======= ======= ======
Variable Universal Life - 100:<F****>
Deposits 16,636 3,083 0 21,192 1,576 0
Withdrawals (4,051) (414) 0 (12,838) (127) 0
Outstanding units, beginning of year 2,669 0 0 1,449 0 0
------- ------- ------ ------- ------- ------
Outstanding units, end of year 15,254 2,669 0 9,803 1,449 0
======= ======= ====== ======= ======= ======
Russell Variable Universal Life: <F*****>
Deposits 8,286 34,380 75,650 3,570 56,596 50,101
Withdrawals (3,252) (3,034) (494) (6,141) (5,688) (1,018)
Outstanding units, beginning of period 106,502 75,156 0 99,991 49,083 0
------- ------- ------ ------- ------- ------
Outstanding units, end of period 111,536 106,502 75,156 97,420 99,991 49,083
======= ======= ====== ======= ======= ======
<FN>
<F*>The Aggressive Equity Fund and Non-US Fund began operations on January 2, 1997.
<F**>The Variable Universal Life - 95 product was introduced to the Frank Russell funds on April 30, 1998, and the first deposit
was received on May 14, 1998.
<F***>The Variable General Select Plus product was introduced in 1997, and the first deposit was received on June 26, 1997.
<F****>The Variable Universal Life - 100 product was introduced to the Frank Russell funds on April 30, 1998, and the first deposit
was received on May 22, 1998.
<F*****>The Russell Variable Universal Life product was introduced in 1997, and the first deposit was received on June 6, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999 and 1998:
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION<F*> FUND DIVISION<F*>
--------------------- ---------------------
1999 1998 1999 1998
------ ----- ------ -----
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 36,276 3,760 14,411 885
Withdrawals (5,039) (70) (2,475) (16)
Outstanding units, beginning of year 3,690 0 869 0
------ ----- ------ ---
Outstanding units, end of year 34,927 3,690 12,805 869
====== ===== ====== ===
Joint and Survivor Variable Universal Life - 98:<F**>
Deposits 3,172 0 2,535 165
Withdrawals (464) 0 (262) (5)
Outstanding units, beginning of year 0 0 160 0
------ ----- ------ ---
Outstanding units, end of year 2,708 0 2,433 160
====== ===== ====== ===
<FN>
<F*>The Aggressive Equity Fund and Non-US Fund began operations on January 2, 1997.
<F**>The Variable Universal Life 98 and Joint And Survivor Variable Universal Life products were introduced in 1998,
and the first deposits were received on September 29, 1998 and October 14, 1998, respectively.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999:
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE
FUND DIVISION<F*> FUND DIVISION<F*> FUND DIVISION<F*>
------------------- ------------------ ------------------
1999 1999 1999
------- ------- -------
<S> <C> <C> <C>
Variable Universal Life - 95:<F**>
Deposits 2,824 1,001 0
Withdrawals (24) (3) 0
Outstanding units, beginning of year 0 0 0
------- ------- -------
Outstanding units, end of year 2,800 998 0
======= ======= =======
Variable General Select Plus:<F**>
Deposits 1,838 5,156 805
Withdrawals (21) (625) (10)
Outstanding units, beginning of year 0 0 0
------- ------- -------
Outstanding units, end of year 1,817 4,531 795
======= ======= =======
Variable Universal Life - 100:<F**>
Deposits 19,391 17,730 10,510
Withdrawals (16,959) (10,629) (10,510)
Outstanding units, beginning of year 0 0 0
------- ------- -------
Outstanding units, end of year 2,432 7,101 0
======= ======= =======
<FN>
<F*>The Income & Growth Fund, International Fund, and Value Fund began operations on September 15, 1998.
<F**>The Variable Universal Life - 95, Variable General Select Plus, and Variable Universal Life - 100 products were introduced to
the American Century funds on April 30, 1999, and the first deposits were received on July 7, 1999, May 17, 1999, and June 18,
1999, respectively.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
period ended December 31, 1999 and 1998:
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE
FUND DIVISION FUND DIVISION FUND DIVISION
-------------------- --------------------- --------------------
1999 1998<F*> 1999 1998<F*> 1999 1998<F*>
------ -------- ------ -------- ------ --------
<S> <C> <C> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 48,580 631 24,488 92 9,149 360
Withdrawals (5,275) (16) (2,024) (7) (1,376) (3)
Outstanding units, beginning of period 615 0 85 0 357 0
------ --- ------ -- ------ ---
Outstanding units, end of period 43,920 615 22,549 85 8,130 357
====== === ====== == ====== ===
Joint and Survivor Variable Universal Life - 98:
Deposits 3,433 0 1,188 0 302 0
Withdrawals (541) 0 (114) 0 (62) 0
Outstanding units, beginning of year 0 0 0 0 0 0
------ --- ------ -- ------ ---
Outstanding units, end of year 2,892 0 1,074 0 240 0
====== === ====== == ====== ===
<FN>
<F*>The Income & Growth Fund, International Fund, and Value Fund began operations on September 15, 1998.
<F**>The Variable Universal Life 98 product was introduced in 1998, and the first deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
year ended December 31, 1999:
<CAPTION>
BOND PORTFOLIO SMALL COMPANY
FUND DIVISION<F*> FUND DIVISION<F*>
-------------------- --------------------
1999 1999
----- ------
<S> <C> <C>
Variable Universal Life-95:<F**>
Deposits 896 4,033
Withdrawals (543) (1,453)
Outstanding units, beginning of year 0 0
---- ------
Outstanding units, end of year 353 2,580
==== ======
Variable General Select Plus:<F**>
Deposits 932 10,153
Withdrawals (6) (62)
Outstanding units, beginning of year 0 0
---- ------
Outstanding units, end of year 926 10,091
==== ======
Variable Universal Life-100:<F**>
Deposits 340 3,598
Withdrawals (9) (16)
Outstanding units, beginning of year 0 0
---- ------
Outstanding units, end of year 331 3,582
==== ======
<FN>
<F*>The Bond Portfolio Fund and Small Company Fund began operations on September 15, 1998.
<F**>The Variable Universal Life - 95, Variable General Select Plus, and Variable Universal Life - 100 products were introduced to
the J. P. Morgan funds on April 30, 1999, and the first deposits were received on July 1, 1999, May 17, 1999, and May 19, 1999,
respectively.
(continued)
<PAGE>
<PAGE>
NOTE 6 - ACCUMULATION UNIT ACTIVITY (CONTINUED)
The following is a summary of the accumulation unit activity for the
years ended December 31, 1999 and 1998:
<CAPTION>
BOND PORTFOLIO SMALL COMPANY
FUND DIVISION FUND DIVISION
--------------------- ------------------------
1999 1998<F*> 1999 1998<F*>
------ -------- ------ --------
<S> <C> <C> <C> <C>
Variable Universal Life - 98:<F**>
Deposits 12,486 330 22,053 292
Withdrawals (680) (2) (3,275) (19)
Outstanding units, beginning of period 328 0 273 0
------ --- ------ ---
Outstanding units, end of period 12,134 328 19,051 273
====== === ====== ===
Joint and Survivor Variable Universal Life - 98:
Deposits 528 0 3,035 0
Withdrawals (107) 0 (326) 0
Outstanding units, beginning of year 0 0 0 0
------ --- ------ ---
Outstanding units, end of year 421 0 2,709 0
====== === ====== ===
<FN>
<F*>The Bond Portfolio Fund and Small Company Fund began operations on September 15, 1998.
<F**>The Variable Universal Life 98 product was introduced in 1998, and the first deposit was received on September 29, 1998.
(continued)
</TABLE>
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT
Deposits into the Separate Account are used to purchase shares in the
Capital Company, Variable Insurance Products Funds, Variable Insurance
Products Fund II, Van Eck Worldwide Insurance Trust, Russell Insurance
Funds, American Century Variable Portfolios, or J.P. Morgan Series Trust
II. Net deposits represent the amounts available for investment in such
shares after deduction of sales charges, premium taxes, administrative
costs, insurance, underwriting and acquisition expense, cost of
insurance, and cost of optional benefits by rider. Realized and
unrealized capital gains (losses) have been excluded from net deposits
into the Separate Account because they have been included in increase
(decrease) in net assets resulting from operations in the Statements of
Changes in Net Assets.
Variable Universal Life - 95:
- -----------------------------
<TABLE>
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
---------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
---------- ----------- ----------- --------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 185,198 $1,456,349 $1,099,723 $ 70,185 $ 813,595 $ 1,794,475
Transfers between fund divisions and
General American 42,863 150,022 931,860 248,848 (578,617) (1,471,521)
Surrenders and withdrawals (254,901) (471,926) (144,131) (1,251) (1,674) (20,934)
--------- ---------- ---------- -------- --------- -----------
Total gross deposits, transfers, and
surrenders between fund divisions (26,840) 1,134,445 1,887,452 317,782 233,304 302,020
--------- ---------- ---------- -------- --------- -----------
Deductions:
Premium load charges 87,826 115,481 84,994 18,195 63,307 371,169
Cost of insurance and administrative
expenses 64,409 702,222 481,051 6,770 217,403 135,973
--------- ---------- ---------- -------- --------- -----------
Total deductions 152,235 817,703 566,045 24,965 280,710 507,142
--------- ---------- ---------- -------- --------- -----------
Net deposits into (withdrawals from)
Separate Account $(179,075) $ 316,742 $1,321,407 $292,817 $ (47,406) $ (205,122)
========= ========== ========== ======== ========= ===========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
--------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
--------- --------- ---------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 61,294 $443,018 $ 312,433 $62,997 $364,076 $ 359,432
Transfers between fund divisions and
General American (33,145) 39,732 504,481 5,215 1,644 53,604
Surrenders and withdrawals (762) (48,407) (161,856) (8,463) (48,475) (162,045)
-------- -------- --------- ------- -------- ---------
Total gross deposits, transfers, and
surrenders between fund divisions 27,387 434,343 655,058 59,749 317,245 250,991
-------- -------- --------- ------- -------- ---------
Deductions:
Premium load charges 20,736 33,733 24,355 25,178 28,257 27,564
Cost of insurance and administrative
expenses 9,997 124,148 111,704 21,239 197,695 191,337
-------- -------- --------- ------- -------- ---------
Total deductions 30,733 157,881 136,059 46,417 225,952 218,901
-------- -------- --------- ------- -------- ---------
Net deposits into (withdrawals from)
Separate Account $ (3,346) $276,462 $ 518,999 $13,332 $ 91,293 $ 32,090
======== ======== ========= ======= ======== =========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
---------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
---------- ----------- ----------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 185,694 $1,409,425 $1,571,785 $ 92,422 $ 577,527 $ 674,809
Transfers between fund divisions and
General American (110,411) (240,301) (542,327) (38,915) (287,016) (244,489)
Surrenders and withdrawals (5,907) (237,885) (261,445) (24,993) (53,267) (27,295)
--------- ---------- ---------- -------- ---------- ---------
Total gross deposits, transfers, and
surrenders between fund divisions 69,376 931,239 768,013 28,514 237,244 403,025
--------- ---------- ---------- -------- ---------- ---------
Deductions:
Premium load charges 71,154 101,603 115,555 32,153 45,221 53,326
Cost of insurance and administrative
expenses 38,489 453,887 472,278 18,992 203,189 206,172
--------- ---------- ---------- -------- ---------- ---------
Total deductions 109,643 555,490 587,833 51,145 248,410 259,498
--------- ---------- ---------- -------- ---------- ---------
Net deposits into (withdrawals from)
Separate Account $ (40,267) $ 375,749 $ 180,180 $(22,631) $ (11,166) $ 143,527
========= ========== ========== ======== ========= =========
<FN>
<F*>This fund was formerly known as the International Equity Fund. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
--------------------------------------- ------------------------------------
1999 1998 1997 1999 1998 1997<F**>
--------- ---------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 73,750 $ 535,140 $ 731,205 $ 14,728 $ 92,984 $ 81,175
Transfers between fund divisions and
General American (11,030) (161,251) (545,250) (24,848) 123,494 386,732
Surrenders and withdrawals (23,853) (60,979) (30,828) 0 (13,142) 0
-------- --------- --------- -------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 38,867 312,910 155,127 (10,120) 203,336 467,907
-------- --------- --------- -------- -------- --------
Deductions:
Premium load charges 28,879 40,775 55,258 4,367 7,292 6,341
Cost of insurance and administrative
expenses 17,499 229,610 226,846 1,828 23,300 4,229
-------- --------- --------- -------- -------- --------
Total deductions 46,378 270,385 282,104 6,195 30,592 10,570
-------- --------- --------- -------- -------- --------
Net deposits into (withdrawals from)
Separate Account $ (7,511) $ 42,525 $(126,977) $(16,315) $172,744 $457,337
======== ========= ========= ======== ======== ========
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>The Small-Cap Equity Fund began operations on May 1, 1997. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
EQUITY-INCOME GROWTH
FUND DIVISION FUND DIVISION
---------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
---------- ----------- ----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 198,741 $1,154,929 $1,258,958 $ 241,466 $1,514,732 $1,700,056
Transfers between fund divisions and
General American (227,879) (50,446) (346,404) (157,307) (487,503) 124,428
Surrenders and withdrawals (163,472) (247,987) (243,196) (316,618) (324,276) (260,054)
--------- ---------- ---------- --------- ---------- ----------
Total gross deposits, transfers, and
surrenders between fund divisions (192,610) 856,496 669,358 (232,459) 702,953 1,564,430
--------- ---------- ---------- --------- ---------- ----------
Deductions:
Premium load charges 81,278 91,178 98,808 114,323 118,852 134,071
Cost of insurance and administrative
expenses 37,192 484,812 470,011 72,257 664,659 606,328
--------- ---------- ---------- --------- ---------- ----------
Total deductions 118,470 575,990 568,819 186,580 783,511 740,399
--------- ---------- ---------- --------- ---------- ----------
Net deposits into (withdrawals from)
Separate Account $(311,080) $ 280,506 $ 100,539 $(419,039) $ (80,558) $ 824,031
========= ========== ========== ========= ========== ==========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
---------------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
--------- ---------- ----------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $105,041 $ 792,155 $ 927,173 $ 9,248 $ 28,935 $ 9,236
Transfers between fund divisions and
General American (65,913) (249,954) 262,454 (1,899) 85,499 3,098
Surrenders and withdrawals (1,091) (84,661) (121,639) 0 (1,077) 0
-------- --------- ---------- ------- -------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 38,037 457,540 1,067,988 7,349 113,357 12,334
-------- --------- ---------- ------- -------- -------
Deductions:
Premium load charges 47,051 60,018 71,458 3,698 2,699 706
Cost of insurance and administrative
expenses 28,789 304,803 302,840 1,120 8,127 1,874
-------- --------- ---------- ------- -------- -------
Total deductions 75,840 364,821 374,298 4,818 10,826 2,580
-------- --------- ---------- ------- -------- -------
Net deposits into (withdrawals from)
Separate Account $(37,803) $ 92,719 $ 693,690 $ 2,531 $102,531 $ 9,754
======== ========= ========== ======= ======== =======
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSETS
FUND DIVISION FUND DIVISION<F*>
-------------------------------------- ----------------------------------
1999 1998 1997 1999 1998 1997
--------- -------- --------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 5,222 $52,060 $ 61,425 $ 12 $ 21,677 $29,642
Transfers between fund divisions and
General American (20,051) 34,487 (76,243) (1,088) (21,580) 31,281
Surrenders and withdrawals 0 (29) 0 0 (10) 0
-------- ------- -------- ------- -------- -------
Total gross deposits, transfers, and
surrenders between fund divisions (14,829) 86,518 (14,818) (1,076) 87 60,923
-------- ------- -------- ------- -------- -------
Deductions:
Premium load charges 2,499 4,139 4,910 310 1,790 2,223
Cost of insurance and administrative
expenses 1,345 22,068 19,821 287 3,541 5,330
-------- ------- -------- ------- -------- -------
Total deductions 3,844 26,207 24,731 597 5,331 7,553
-------- ------- -------- ------- -------- -------
Net deposits into (withdrawals from)
Separate Account $(18,673) $60,311 $(39,549) $(1,673) $ (5,244) $53,370
======== ======= ======== ======= ======== =======
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
WORLDWIDE
EMERGING MARKETS MULTI-STYLE EQUITY CORE BOND
FUND DIVISION FUND DIVISION FUND DIVISION
---------------- --------------------- --------------------
1999<F**> 1999 1998<F*> 1999 1998<F*>
--------- ------- -------- ------ --------
<S> <C> <C> <C> <C> <C>
Total gross deposits $ 632 $11,094 $ 11,160 $1,310 $ 558
Transfers between fund divisions and
General American 26,701 0 129,908 0 42,124
Surrenders and withdrawals (20,109) 0 (1,571) 0 0
-------- ------- -------- ------ -------
Total gross deposits, transfers, and
surrenders between fund divisions 7,224 11,094 139,497 1,310 42,682
-------- ------- -------- ------ -------
Deductions:
Premium load charges 22 3,558 1,059 314 33
Cost of insurance and administrative expenses 271 1,703 2,418 261 479
-------- ------- -------- ------ -------
Total deductions 293 5,261 3,477 575 512
-------- ------- -------- ------ -------
Net deposits into Separate Account $ 6,931 $ 5,833 $136,020 $ 735 $42,170
======== ======= ======== ====== =======
<FN>
<F*>The Variable Universal Life - 95 product became available to these funds on April 30, 1998. (continued)
<F**>The Variable Universal Life - 95 product became available to this fund on April 30, 1999.
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
AGGRESSIVE EQUITY NON-US INCOME & GROWTH
FUND DIVISION FUND DIVISION FUND DIVISION
--------------------- -------------------- ---------------
1999 1998<F*> 1999 1998<F*> 1999<F**>
------ --------- ------ -------- ---------
<S> <C> <C> <C> <C> <C>
Total gross deposits $5,123 $ 3,900 $8,286 $ 5,027 $ 350
Transfers between fund divisions and
General American 0 111,676 0 81,549 4,916
Surrenders and withdrawals 0 (721) 0 0 0
------ -------- ------ ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 5,123 114,855 8,286 86,576 5,266
------ -------- ------ ------- ------
Deductions:
Premium load charges 1,837 512 1,307 536 45
Cost of insurance and administrative expenses 1,058 2,054 596 1,957 93
------ -------- ------ ------- ------
Total deductions 2,895 2,566 1,903 2,493 138
------ -------- ------ ------- ------
Net deposits into Separate Account $2,228 $112,289 $6,383 $84,083 $5,128
====== ======== ====== ======= ======
<FN>
<F*>The Variable Universal Life - 95 product became available to these funds on April 30, 1998.
<F**>The Variable Universal Life - 95 product became available to this fund on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 95:
- -----------------------------
<CAPTION>
SMALL COMPANY
INTERNATIONAL BOND PORTFOLIO PORTFOLIO
FUND DIVISION FUND DIVISION FUND DIVISION
------------- ---------------- ---------------
1999<F*> 1999<F*> 1999<F*>
-------- -------- --------
<S> <C> <C> <C>
Total gross deposits $ 150 $ 18 $ 871
Transfers between fund divisions and
General American 6,911 3,471 21,899
Surrenders and withdrawals 0 0 (18,684)
------ ------ --------
Total gross deposits, transfers, and
surrenders between fund divisions 7,061 3,489 4,086
------ ------ --------
Deductions:
Premium load charges 16 0 22
Cost of insurance and administrative expenses 14 0 269
------ ------ --------
Total deductions 30 0 291
------ ------ --------
Net deposits into Separate Account $7,031 $3,489 $ 3,795
====== ====== ========
<FN>
<F*>The Variable Universal Life - 95 product became available to these funds on April 30, 1999. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------------------------- -----------------------------------------
1999 1998 1997 1999 1998 1997
------------ ----------- ------------ ---------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 9,516,696 $1,357,475 $ 1,229,167 $3,414,103 $ 16,933,833 $11,949,827
Transfers between fund divisions and
General American 60,389 5,431,739 1,639,191 27,242 (20,254,746) (6,333,824)
Surrenders and withdrawals (1,040,805) (152,414) (5,100,149) 0 (214,226) (4,042,319)
----------- ---------- ----------- ---------- ------------ -----------
Total gross deposits, transfers, and
surrenders between fund divisions 8,536,280 6,636,800 (2,231,791) 3,441,345 (3,535,139) 1,573,684
----------- ---------- ----------- ---------- ------------ -----------
Deductions:
Premium load charges 172,275 99,759 88,924 544,962 1,299,538 870,893
Cost of insurance and administrative
expenses 38,868 293,438 158,092 7,722 221,400 158,166
----------- ---------- ----------- ---------- ------------ -----------
Total deductions 211,143 393,197 247,016 552,684 1,520,938 1,029,059
----------- ---------- ----------- ---------- ------------ -----------
Net deposits into (withdrawals from)
Separate Account $ 8,325,137 $6,243,603 $(2,478,807) $2,888,661 $ (5,056,077) $ 544,625
=========== ========== =========== ========== ============ ===========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
---------------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
----------- --------- ------------ --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $1,499,923 $146,938 $ 170,971 $686,238 $185,192 $225,421
Transfers between fund divisions and
General American (51,332) 205,041 109,381 (5,378) (477) 49,038
Surrenders and withdrawals (8,668) (27,635) (4,675,478) (1,579) (44,810) (28,866)
---------- -------- ----------- -------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 1,439,923 324,344 (4,395,126) 679,281 139,905 245,593
---------- -------- ----------- -------- -------- --------
Deductions:
Premium load charges 17,017 10,813 12,639 14,026 12,749 16,872
Cost of insurance and administrative
expenses 3,507 29,846 24,838 2,662 29,578 24,211
---------- -------- ----------- -------- -------- --------
Total deductions 20,524 40,659 37,477 16,688 42,327 41,083
---------- -------- ----------- -------- -------- --------
Net deposits into (withdrawals from)
Separate Account $1,419,399 $283,685 $(4,432,603) $662,593 $ 97,578 $204,510
========== ======== =========== ======== ======== ========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
--------------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
----------- ---------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $1,791,144 $ 231,397 $225,188 $347,511 $244,143 $273,454
Transfers between fund divisions and
General American (4,461) 160,811 92,485 (30,925) (26,160) 190,371
Surrenders and withdrawals (21,717) (166,928) (48,400) (18,143) (16,419) (47,175)
---------- --------- -------- -------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 1,764,966 225,280 269,273 298,443 201,564 416,650
---------- --------- -------- -------- -------- --------
Deductions:
Premium load charges 22,493 14,905 17,168 15,706 16,859 19,728
Cost of insurance and administrative
expenses 8,155 84,944 67,268 4,823 44,378 37,091
---------- --------- -------- -------- -------- --------
Total deductions 30,648 99,849 84,436 20,529 61,237 56,819
---------- --------- -------- -------- -------- --------
Net deposits into Separate Account $1,734,318 $ 125,431 $184,837 $277,914 $140,327 $359,831
========== ========= ======== ======== ======== ========
<FN>
<F*>This fund was formerly known as the International Equity Fund. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
--------------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997<F**>
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $190,421 $338,015 $376,253 $826,906 $263,673 $ 59,270
Transfers between fund divisions and
General American (54,387) 458,678 301,956 (43,257) 330,151 326,392
Surrenders and withdrawals (16,526) (25,379) (53,267) 0 0 0
-------- -------- -------- -------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 119,508 771,314 624,942 783,649 593,824 385,662
-------- -------- -------- -------- -------- --------
Deductions:
Premium load charges 22,927 24,362 29,256 24,112 19,071 4,711
Cost of insurance and administrative
expenses 5,491 67,262 40,346 2,329 19,764 3,518
-------- -------- -------- -------- -------- --------
Total deductions 28,418 91,624 69,602 26,441 38,835 8,229
-------- -------- -------- -------- -------- --------
Net deposits into Separate Account $ 91,090 $679,690 $555,340 $757,208 $554,989 $377,433
======== ======== ======== ======== ======== ========
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>The Small-Cap Equity Fund began operations on May 1, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
EQUITY-INCOME GROWTH
FUND DIVISION FUND DIVISION
----------------------------------------- -----------------------------------------
1999 1998 1997 1999 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $2,525,240 $1,492,223 $1,043,306 $5,816,419 $1,297,862 $1,354,928
Transfers between fund divisions and
General American (83,685) 748,006 658,129 361,192 891,558 957,813
Surrenders and withdrawals (50,381) (183,143) (148,279) (74,872) (255,377) (268,257)
---------- ---------- ---------- ---------- ---------- ----------
Total gross deposits, transfers, and
surrenders between fund divisions 2,391,174 2,057,086 1,553,156 6,102,739 1,934,043 2,044,484
---------- ---------- ---------- ---------- ---------- ----------
Deductions:
Premium load charges 80,926 82,617 78,543 108,587 84,087 101,854
Cost of insurance and administrative
expenses 21,370 216,335 163,469 34,735 250,176 206,497
---------- ---------- ---------- ---------- ---------- ----------
Total deductions 102,296 298,952 242,012 143,322 334,263 308,351
---------- ---------- ---------- ---------- ---------- ----------
Net deposits into Separate Account $2,288,878 $1,758,134 $1,311,144 $5,959,417 $1,599,780 $1,736,133
========== ========== ========== ========== ========== ==========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
------------------------------------ ----------------------------------
1999 1998 1997 1999 1998 1997
--------- ---------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $616,304 $ 557,583 $763,625 $869,266 $ 27,818 $53,004
Transfers between fund divisions and
General American 86,786 (150,747) 265,722 (2,696) 93,342 3,027
Surrenders and withdrawals (16,745) (55,531) (56,432) 0 0 (2,184)
-------- --------- -------- -------- -------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 686,345 351,305 972,915 866,570 121,160 53,847
-------- --------- -------- -------- -------- -------
Deductions:
Premium load charges 46,057 40,327 57,640 4,522 1,654 3,927
Cost of insurance and administrative
expenses 8,922 79,907 71,616 1,055 6,502 3,625
-------- --------- -------- -------- -------- -------
Total deductions 54,979 120,234 129,256 5,577 8,156 7,552
-------- --------- -------- -------- -------- -------
Net deposits into Separate Account $631,366 $ 231,071 $843,659 $860,993 $113,004 $46,295
======== ========= ======== ======== ======== =======
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSETS
FUND DIVISION FUND DIVISION<F*>
----------------------------------- ---------------------------------
1999 1998 1997 1999 1998 1997
--------- --------- --------- ------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $941,150 $241,925 $201,994 $51,609 $ 6,454 $ 22,621
Transfers between fund divisions and
General American 11,214 156,540 207,353 0 (6,638) 1,823
Surrenders and withdrawals (10,166) (16,195) (6,433) 0 (841) (36,871)
-------- -------- -------- ------- ------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 942,198 382,270 402,914 51,609 (1,025) (12,427)
-------- -------- -------- ------- ------- --------
Deductions:
Premium load charges 16,895 17,692 15,004 447 376 1,715
Cost of insurance and administrative
expenses 2,659 34,790 25,526 159 1,055 890
-------- -------- -------- ------- ------- --------
Total deductions 19,554 52,482 40,530 606 1,431 2,605
-------- -------- -------- ------- ------- --------
Net deposits into (withdrawals from)
Separate Account $922,644 $329,788 $362,384 $51,003 $(2,456) $(15,032)
======== ======== ======== ======= ======= ========
<CAPTION>
WORLDWIDE
EMERGING MARKETS
FUND DIVISION
-----------------
1999<F**>
-----------
<S> <C>
Total gross deposits $159,565
Transfers between fund divisions and
General American 27,490
Surrenders and withdrawals 0
--------
Total gross deposits, transfers, and
surrenders between fund divisions 187,055
--------
Deductions:
Premium load charges 61
Cost of insurance and administrative
expenses 578
--------
Total deductions 639
--------
Net deposits into (withdrawals from)
Separate Account $186,416
========
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund.
<F**>The Variable General Select Plus product became available to these funds on April 30, 1999. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
MULTI-STYLE EQUITY CORE BOND
FUND DIVISION FUND DIVISION
-------------------------------------- --------------------------------------
1999 1998 1997<F*> 1999 1998 1997<F*>
----------- ----------- -------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $3,354,781 $1,940,731 $ 80,451 $3,385,014 $1,482,889 $ 17,978
Transfers between fund divisions and
General American (238,145) 4,822,163 532,364 109,400 3,101,165 215,118
Surrenders and withdrawals 0 (187) 0 0 0 0
---------- ---------- -------- ---------- ---------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 3,116,636 6,762,707 612,815 3,494,414 4,584,054 233,096
---------- ---------- -------- ---------- ---------- --------
Deductions:
Premium load charges 192,138 204,842 5,866 162,629 117,137 1,346
Cost of insurance and administrative
expenses 33,513 255,638 8,425 21,037 182,736 2,474
---------- ---------- -------- ---------- ---------- --------
Total deductions 225,651 460,480 14,291 183,666 299,873 3,820
---------- ---------- -------- ---------- ---------- --------
Net deposits into Separate Account $2,890,985 $6,302,227 $598,524 $3,310,748 $4,284,181 $229,276
========== ========== ======== ========== ========== ========
<FN>
<F*>The Multi-style Equity Fund, Core Bond Fund, Aggressive Equity Fund, and Non-US Fund began operations on January 2, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION FUND DIVISION
-------------------------------------- --------------------------------------
1999 1998 1997<F*> 1999 1998 1997<F*>
-------- ---------- -------- --------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $686,381 $ 502,264 $ 54,099 $ 453,079 $ 264,324 $ 42,059
Transfers between fund divisions and
General American (84,039) 1,704,740 281,507 (109,436) 1,609,166 276,242
Surrenders and withdrawals 0 (116) 0 0 (119) 0
-------- ---------- -------- --------- ---------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 602,342 2,206,888 335,606 343,643 1,873,371 318,301
-------- ---------- -------- --------- ---------- --------
Deductions:
Premium load charges 47,306 71,141 3,761 26,226 34,958 3,283
Cost of insurance and administrative
expenses 6,671 47,691 3,632 7,300 38,906 3,028
-------- ---------- -------- --------- ---------- --------
Total deductions 53,977 118,832 7,393 33,526 73,864 6,311
-------- ---------- -------- --------- ---------- --------
Net deposits into Separate Account $548,365 $2,088,056 $328,213 $ 310,117 $1,799,507 $311,990
======== ========== ======== ========= ========== ========
<FN>
<F*>The Multi-style Equity Fund, Core Bond Fund, Aggressive Equity Fund, and Non-US Fund began operations on January 2, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable General Select Plus:
- -----------------------------
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE BOND PORTFOLIO SMALL COMPANY
FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION
--------------- ------------- ------------- -------------- -------------
1999<F*> 1999<F*> 1999<F*> 1999<F*> 1999<F*>
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Total gross deposits $584,148 $306,558 $89,282 $128,073 $375,118
Transfers between fund divisions and
General American 10,803 9,583 0 0 36,269
Surrenders and withdrawals 0 0 0 0 0
-------- -------- ------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 594,951 316,141 89,282 128,073 411,387
-------- -------- ------- -------- --------
Deductions:
Premium load charges 57 57 70 0 72
Cost of insurance and administrative expenses 41 126 18 18 566
-------- -------- ------- -------- --------
Total deductions 98 183 88 18 638
-------- -------- ------- -------- --------
Net deposits into Separate Account $594,853 $315,958 $89,194 $128,055 $410,749
======== ======== ======= ======== ========
<FN>
<F*>The Variable General Select Plus product became available to these funds on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
--------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
--------- ---------- ---------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 497,709 $3,774,275 $1,995,433 $ 144,058 $ 9,507,851 $ 8,679,144
Transfers between fund divisions and
General American (19,257) 5,484,204 2,177,143 (223,896) (8,000,842) (7,303,949)
Surrenders and withdrawals (140,100) (299,771) (68,513) 0 (11,635) (3,421)
--------- ---------- ---------- --------- ----------- -----------
Total gross deposits, transfers, and
surrenders between fund divisions 338,352 8,958,708 4,104,063 (79,838) 1,495,374 1,371,774
--------- ---------- ---------- --------- ----------- -----------
Deductions:
Premium load charges 157,232 126,277 66,092 121,639 296,413 286,729
Cost of insurance and administrative
expenses 140,651 1,411,705 671,147 9,414 639,686 599,119
--------- ---------- ---------- --------- ----------- -----------
Total deductions 297,883 1,537,982 737,239 131,053 936,099 885,848
--------- ---------- ---------- --------- ----------- -----------
Net deposits into (withdrawals from)
Separate Account $ 40,469 $7,420,726 $3,366,824 $(210,891) $ 559,275 $ 485,926
========= ========== ========== ========= =========== ===========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $27,523 $279,989 $184,259 $78,693 $488,098 $228,756
Transfers between fund divisions and
General American (7,468) 613,426 265,500 3,494 247,910 432,012
Surrenders and withdrawals (1,636) (10,480) (4,282) (2,376) (59,153) (13,613)
------- -------- -------- ------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 18,419 882,935 445,477 79,811 676,855 647,155
------- -------- -------- ------- -------- --------
Deductions:
Premium load charges 10,567 9,514 6,186 16,793 16,604 7,603
Cost of insurance and administrative
expenses 7,925 83,804 57,817 14,086 178,243 96,349
------- -------- -------- ------- -------- --------
Total deductions 18,492 93,318 64,003 30,879 194,847 103,952
------- -------- -------- ------- -------- --------
Net deposits into (withdrawals from)
Separate Account $ (73) $789,617 $381,474 $48,932 $482,008 $543,203
======= ======== ======== ======= ======== ========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F*>
-------------------------------------- --------------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $174,486 $652,869 $297,431 $ 30,589 $542,245 $380,598
Transfers between fund divisions and
General American (14,732) 212,547 423,970 (74,184) 82,381 259,917
Surrenders and withdrawals (1,320) (16,485) (7,250) (1,545) (13,406) (12,338)
-------- -------- -------- -------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 158,434 848,931 714,151 (45,140) 611,220 628,177
-------- -------- -------- -------- -------- --------
Deductions:
Premium load charges 31,177 21,971 10,273 19,041 18,719 12,990
Cost of insurance and administrative
expenses 29,388 237,042 159,083 13,745 172,801 138,712
-------- -------- -------- -------- -------- --------
Total deductions 60,565 259,013 169,356 32,786 191,520 151,702
-------- -------- -------- -------- -------- --------
Net deposits into (withdrawals from)
Separate Account $ 97,869 $589,918 $544,795 $(77,926) $419,700 $476,475
======== ======== ======== ======== ======== ========
<FN>
<F*>This fund was formerly known as the International Equity Fund.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F*> FUND DIVISION
--------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997<F**>
--------- -------- -------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 60,351 $694,795 $405,467 $ 37,239 $390,118 $ 48,912
Transfers between fund divisions and
General American (121,007) 218,584 129,102 (118,733) 485,204 254,044
Surrenders and withdrawals (2,516) (36,811) (15,375) 0 (2,420) 0
--------- -------- -------- --------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions (63,172) 876,568 519,194 (81,494) 872,902 302,956
--------- -------- -------- --------- -------- --------
Deductions:
Premium load charges 22,088 23,485 13,537 15,661 13,324 1,579
Cost of insurance and administrative
expenses 14,426 206,508 140,909 8,182 114,663 7,052
--------- -------- -------- --------- -------- --------
Total deductions 36,514 229,993 154,446 23,843 127,987 8,631
--------- -------- -------- --------- -------- --------
Net deposits into (withdrawals from)
Separate Account $ (99,686) $646,575 $364,748 $(105,337) $744,915 $294,325
========= ======== ======== ========= ======== ========
<FN>
<F*>This fund was formerly known as the Special Equity Fund.
<F**>The Small-Cap Equity Fund began operations on May 1, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
-------------------------------------- ---------------------------------------
1999 1998 1997 1999 1998 1997
-------- ----------- ---------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $191,931 $ 2,136,531 $1,996,233 $ 345,160 $2,942,824 $2,402,233
Transfers between fund divisions and
General American (87,709) (1,236,416) 792,184 122,542 694,369 1,492,743
Surrenders and withdrawals (9,312) (127,426) (44,826) (341,338) (279,188) (114,282)
-------- ----------- ---------- --------- ---------- ----------
Total gross deposits, transfers, and
surrenders between fund divisions 94,910 772,689 2,743,591 126,364 3,358,005 3,780,694
-------- ----------- ---------- --------- ---------- ----------
Deductions:
Premium load charges 62,308 78,973 66,340 101,279 103,369 80,190
Cost of insurance and administrative
expenses 45,170 940,207 572,720 106,234 1,188,418 842,557
-------- ----------- ---------- --------- ---------- ----------
Total deductions 107,478 1,019,180 639,060 207,513 1,291,787 922,747
-------- ----------- ---------- --------- ---------- ----------
Net deposits into (withdrawals from)
Separate Account $(12,568) $ (246,491) $2,104,531 $ (81,149) $2,066,218 $2,857,947
======== =========== ========== ========= ========== ==========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
-------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 60,624 $630,759 $508,810 $36,199 $317,439 $147,295
Transfers between fund divisions and
General American 86,259 143,337 313,710 2,278 146,214 109,004
Surrenders and withdrawals (4,693) (59,595) (22,505) (1,984) (26,187) (5,778)
-------- -------- -------- ------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 142,190 714,501 800,015 36,493 437,466 250,521
-------- -------- -------- ------- -------- --------
Deductions:
Premium load charges 21,350 21,503 17,197 11,474 10,729 4,955
Cost of insurance and administrative
expenses 16,685 195,007 165,254 10,603 117,605 74,461
-------- -------- -------- ------- -------- --------
Total deductions 38,035 216,510 182,451 22,077 128,334 79,416
-------- -------- -------- ------- -------- --------
Net deposits into Separate Account $104,155 $497,991 $617,564 $14,416 $309,132 $171,105
======== ======== ======== ======= ======== ========
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
HIGH INCOME WORLDWIDE HARD ASSETS
FUND DIVISION FUND DIVISION<F*>
-------------------------------------- -------------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 61,798 $469,183 $300,761 $ 4,754 $60,696 $63,004
Transfers between fund divisions and
General American 174,344 256,832 224,109 (3,654) 10,164 18,216
Surrenders and withdrawals 0 (12,240) (20,348) 0 (2,562) (4,909)
-------- -------- -------- ------- ------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 236,142 713,775 504,522 1,100 68,298 76,311
-------- -------- -------- ------- ------- -------
Deductions:
Premium load charges 23,688 15,948 10,110 1,670 2,007 2,147
Cost of insurance and administrative
expenses 15,033 130,579 105,718 1,229 17,277 19,651
-------- -------- -------- ------- ------- -------
Total deductions 38,721 146,527 115,828 2,899 19,284 21,798
-------- -------- -------- ------- ------- -------
Net deposits into (withdrawals from)
Separate Account $197,421 $567,248 $388,694 $(1,799) $49,014 $54,513
======== ======== ======== ======= ======= =======
<FN>
<F*>This fund was formerly known as the Gold & Natural Resources Fund.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
WORLDWIDE
EMERGING MARKETS MULTI-STYLE EQUITY CORE BOND
FUND DIVISION FUND DIVISION FUND DIVISION
---------------- ------------------------- -------------------------
1999<F**> 1999 1998<F*> 1999 1998<F*>
--------- ------- -------- ------ --------
<S> <C> <C> <C> <C> <C>
Total gross deposits $ 52 $29,816 $11,281 $7,874 $1,071
Transfers between fund divisions and
General American 2,925 (584) 62,902 (56) 7,124
Surrenders and withdrawals (3,567) 114 (69) 1,463 0
------- ------- ------- ------ ------
Total gross deposits, transfers, and
surrenders between fund divisions (590) 29,346 74,114 9,281 8,195
------- ------- ------- ------ ------
Deductions:
Premium load charges 7 6,946 460 886 40
Cost of insurance and administrative expenses 88 5,732 5,703 475 1,266
------- ------- ------- ------ ------
Total deductions 95 12,678 6,163 1,361 1,306
------- ------- ------- ------ ------
Net deposits into (withdrawals from)
Separate Account $ (685) $16,668 $67,951 $7,920 $6,889
======= ======= ======= ====== ======
<FN>
<F*>The Variable Universal Life - 100 product became available to these funds on April 30, 1998.
<F**>The Variable Universal Life - 100 product became available to this fund on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION FUND DIVISION
---------------------- -----------------------
1999 1998<F*> 1999 1998<F*>
------ -------- ------- --------
<S> <C> <C> <C> <C>
Total gross deposits $5,962 $(3,957) $ 5,131 $ 1,368
Transfers between fund divisions and
General American (656) 20,863 (194) 12,106
Surrenders and withdrawals 0 0 (1,225) 0
------ ------- ------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 5,306 16,906 3,712 13,474
------ ------- ------- -------
Deductions:
Premium load charges 1,972 167 1,252 103
Cost of insurance and administrative expenses 2,098 3,404 1,797 1,186
------ ------- ------- -------
Total deductions 4,070 3,571 3,049 1,289
------ ------- ------- -------
Net deposits into Separate Account $1,236 $13,335 $ 663 $12,185
====== ======= ======= =======
<FN>
<F*>The Variable Universal Life - 100 product became available to these funds on April 30, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life - 100:
- ------------------------------
<CAPTION>
SMALL COMPANY
INCOME & GROWTH INTERNATIONAL VALUE BOND PORTFOLIO PORTFOLIO
FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION FUND DIVISION
--------------- ------------- ------------- -------------- -------------
1999<F*> 1999<F*> 1999<F*> 1999<F*> 1999<F*>
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Total gross deposits $ 7,302 $ 4,437 $(2,632) $ 68 $ 1,074
Transfers between fund divisions and
General American (13,611) 89,802 0 0 30,306
Surrenders and withdrawals (872) (524) 704 0 0
-------- ------- ------- ----- -------
Total gross deposits, transfers, and
surrenders between fund divisions (7,181) 93,715 (1,928) 68 31,380
-------- ------- ------- ----- -------
Deductions:
Premium load charges 428 90 0 7 39
Cost of insurance and administrative expenses 169 15 2 29 72
-------- ------- ------- ----- -------
Total deductions 597 105 2 36 111
-------- ------- ------- ----- -------
Net deposits into (withdrawals from)
Separate Account $ (7,778) $93,610 $(1,930) $ 32 $31,269
======== ======= ======= ===== =======
<FN>
<F*>The Variable Universal Life - 100 product became available to these funds on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Russell Variable Universal Life:<F*>
- ------------------------------------
<CAPTION>
MONEY MARKET MULTI-STYLE EQUITY
FUND DIVISION FUND DIVISION
--------------------------- --------------------------------------------
1998 1997 1999 1998 1997<F**>
--------- ----------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Total gross deposits $ 415,709 $ 4,627,386 $ 11,757 $1,037,690 $ 19,255
Transfers between fund divisions and
General American (469,090) (4,374,607) 0 154,284 1,937,967
Surrenders and withdrawals 0 0 0 (13,263) (328)
--------- ----------- -------- ---------- ----------
Total gross deposits, transfers, and
surrenders between fund divisions (53,381) 252,779 11,757 1,178,711 1,956,894
--------- ----------- -------- ---------- ----------
Deductions:
Premium load charges 27,188 72,762 11,910 75,029 1,369
Cost of insurance and administrative expenses 10,537 72,945 11,989 108,054 19,567
--------- ----------- -------- ---------- ----------
Total deductions 37,725 145,707 23,899 183,083 20,936
--------- ----------- -------- ---------- ----------
Net deposits into (withdrawals from)
Separate Account $ (91,106) $ 107,072 $(12,142) $ 995,628 $1,935,958
========= =========== ======== ========== ==========
<CAPTION>
CORE BOND
FUND DIVISION
-----------------------------------------------
1999 1998 1997<F**>
------- ---------- ---------
<S> <C> <C> <C>
Total gross deposits $ 2,104 $ 932,874 $ 3,472
Transfers between fund divisions and
General American 0 167,553 914,278
Surrenders and withdrawals 0 (15,205) 0
------- ---------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 2,104 1,085,222 917,750
------- ---------- --------
Deductions:
Premium load charges 2,839 62,053 0
Cost of insurance and administrative expenses 9,047 102,484 21,735
------- ---------- --------
Total deductions 11,886 164,537 21,735
------- ---------- --------
Net deposits into (withdrawals from)
Separate Account $(9,782) $ 920,685 $896,015
======= ========== ========
<FN>
<F*>Russell Variable Universal Life product was introduced in 1997, and the first deposit was received on June 6, 1997.
<F**>The Multi-style Equity Fund and Core Bond Fund began operations on January 2, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Russell Variable Universal Life:<F*>
- ------------------------------------
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION FUND DIVISION
-------------------------------------- --------------------------------------
1999 1998 1997<F**> 1999 1998 1997<F**>
------- -------- --------- ------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total gross deposits $ 6,989 $397,370 $ 12,641 $ 2,513 $514,239 $ 8,990
Transfers between fund divisions and
General American 0 54,038 987,308 0 91,705 532,277
Surrenders and withdrawals 0 (3,526) (94) 0 (6,050) (137)
------- -------- -------- ------- -------- --------
Total gross deposits, transfers, and
surrenders between fund divisions 6,989 447,882 999,855 2,513 599,894 541,130
------- -------- -------- ------- -------- --------
Deductions:
Premium load charges 7,446 28,279 822 3,137 36,821 548
Cost of insurance and administrative
expenses 3,346 35,589 6,442 5,864 50,919 10,345
------- -------- -------- ------- -------- --------
Total deductions 10,792 63,868 7,264 9,001 87,740 10,893
------- -------- -------- ------- -------- --------
Net deposits into (withdrawals from)
Separate Account $(3,803) $384,014 $992,591 $(6,488) $512,154 $530,237
======= ======== ======== ======= ======== ========
<FN>
<F*>Russell Variable Universal Life product was introduced in 1997, and the first deposit was received on June 6, 1997.
<F**>The Aggressive Equity Fund and Non-US Fund began operations on January 2, 1997.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------- --------------------------
1999 1998 1999 1998
-------- -------- ----------- ----------
<S> <C> <C> <C> <C>
Total gross deposits $445,984 $ 4,307 $ 3,382,823 $2,186,833
Transfers between fund divisions and
General American 306,257 136,331 (1,591,945) (337,148)
Surrenders and withdrawals (611) 0 (5,968) 0
-------- -------- ----------- ----------
Total gross deposits, transfers, and
surrenders between fund divisions 751,630 140,638 1,784,910 1,849,685
-------- -------- ----------- ----------
Deductions:
Premium load charges 178,933 555 1,942,937 262,833
Cost of insurance and administrative expenses 77,279 2,864 65,472 52,876
-------- -------- ----------- ----------
Total deductions 256,212 3,419 2,008,409 315,709
-------- -------- ----------- ----------
Net deposits into (withdrawals from)
Separate Account $495,418 $137,219 $ (223,499) $1,533,976
======== ======== =========== ==========
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the first
deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
BOND INDEX MANAGED EQUITY
FUND DIVISION FUND DIVISION
------------------------ -----------------------
1999 1998 1999 1998
---------- ------ ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $ 23,548 $ 86 $14,479 $ 186
Transfers between fund divisions and
General American (187,277) 5,616 11,989 8,181
Surrenders and withdrawals (195) 0 0 0
--------- ------ ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions (163,924) 5,702 26,468 8,367
--------- ------ ------- ------
Deductions:
Premium load charges 7,871 14 10,119 27
Cost of insurance and administrative expenses 3,174 52 3,388 154
--------- ------ ------- ------
Total deductions 11,045 66 13,507 181
--------- ------ ------- ------
Net deposits into (withdrawals from)
Separate Account $(174,969) $5,636 $12,961 $8,186
========= ====== ======= ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the first
deposit was received on September 29, 1998. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
ASSET ALLOCATION INTERNATIONAL INDEX
FUND DIVISION FUND DIVISION<F**>
------------------------- -----------------------
1999 1998 1999 1998
------- ------- ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $23,556 $ 294 $22,587 $ 398
Transfers between fund divisions and
General American 33,414 11,801 37,150 7,529
Surrenders and withdrawals 0 0 (173) 0
------- ------- ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 56,970 12,095 59,564 7,927
------- ------- ------- ------
Deductions:
Premium load charges 8,354 30 8,623 44
Cost of insurance and administrative expenses 4,085 166 3,251 192
------- ------- ------- ------
Total deductions 12,439 196 11,874 236
------- ------- ------- ------
Net deposits into Separate Account $44,531 $11,899 $47,690 $7,691
======= ======= ======= ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>This fund was formerly known as the International Equity Fund. (continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
MID-CAP EQUITY SMALL-CAP EQUITY
FUND DIVISION<F**> FUND DIVISION
---------------------- -----------------------
1999 1998 1999 1998
-------- ------ ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $18,623 $ 269 $20,399 $ 506
Transfers between fund divisions and
General American 21,442 6,292 16,055 6,347
Surrenders and withdrawals (330) 0 (277) 0
------- ------ ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 39,735 6,561 36,177 6,853
------- ------ ------- ------
Deductions:
Premium load charges 11,545 34 10,879 68
Cost of insurance and administrative expenses 3,828 247 4,124 265
------- ------ ------- ------
Total deductions 15,373 281 15,003 333
------- ------ ------- ------
Net deposits into Separate Account $24,362 $6,280 $21,174 $6,520
======= ====== ======= ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>This fund was formerly known as the Special Equity Fund.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
EQUITY INCOME GROWTH
FUND DIVISION FUND DIVISION
------------------------- ------------------------
1999 1998 1999 1998
--------- ------- --------- -------
<S> <C> <C> <C> <C>
Total gross deposits $ 69,744 $ 2,126 $264,768 $ 3,312
Transfers between fund divisions and
General American 159,840 22,773 639,837 43,658
Surrenders and withdrawals (44) 0 (2,741) 0
-------- ------- -------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 229,540 24,899 901,864 46,970
-------- ------- -------- -------
Deductions:
Premium load charges 32,639 235 99,411 248
Cost of insurance and administrative expenses 13,365 1,202 38,779 1,227
-------- ------- -------- -------
Total deductions 46,004 1,437 138,190 1,475
-------- ------- -------- -------
Net deposits into Separate Account $183,536 $23,462 $763,674 $45,495
======== ======= ======== =======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION
------------------------ -----------------------
1999 1998 1999 1998
------- ------ --------- ------
<S> <C> <C> <C> <C>
Total gross deposits $46,521 $ 550 $ 25,593 $1,890
Transfers between fund divisions and
General American 32,045 6,272 94,012 6,091
Surrenders and withdrawals 0 0 (403) 0
------- ------ -------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 78,566 6,822 119,202 7,981
------- ------ -------- ------
Deductions:
Premium load charges 18,594 55 7,359 111
Cost of insurance and administrative expenses 5,846 195 4,946 635
------- ------ -------- ------
Total deductions 24,440 250 12,305 746
------- ------ -------- ------
Net deposits into Separate Account $54,126 $6,572 $106,897 $7,235
======= ====== ======== ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
WORLWIDE
HIGH INCOME HARD ASSETS
FUND DIVISION FUND DIVISION
------------------------- --------------------
1999 1998 1999 1998
-------- ------- ---- ----
<S> <C> <C> <C> <C>
Total gross deposits $24,835 $ 582 $584 $ 74
Transfers between fund divisions and
General American 26,973 11,663 211 56
Surrenders and withdrawals (193) 0 0 0
------- ------- ---- ----
Total gross deposits, transfers, and
surrenders between fund divisions 51,615 12,245 795 130
------- ------- ---- ----
Deductions:
Premium load charges 12,198 84 359 12
Cost of insurance and administrative expenses 3,939 300 236 4
------- ------- ---- ----
Total deductions 16,137 384 595 16
------- ------- ---- ----
Net deposits into Separate Account $35,478 $11,861 $200 $114
======= ======= ==== ====
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
WORLDWIDE MULTI-STYLE
EMERGING MARKETS EQUITY
FUND DIVISION FUND DIVISION
------------------------- -----------------------
1999<F**> 1998 1999 1998
--------- ------ -------- -------
<S> <C> <C> <C> <C>
Total gross deposits $3,360 $ 45 $ 68,210 $26,946
Transfers between fund divisions and
General American 3,702 1,753 78,386 12,531
Surrenders and withdrawals 0 0 (198) 0
------ ------ -------- -------
Total gross deposits, transfers, and
surrenders between fund divisions 7,062 1,798 146,398 39,477
------ ------ -------- -------
Deductions:
Premium load charges 1,161 7 30,461 3,877
Cost of insurance and administrative expenses 861 91 11,758 1,140
------ ------ -------- -------
Total deductions 2,022 98 42,219 5,017
------ ------ -------- -------
Net deposits into Separate Account $5,040 $1,700 $104,179 $34,460
====== ====== ======== =======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>The Variable Universal Life Insurance 98 product became available to these funds
on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
AGGRESSIVE
CORE BOND EQUITY
FUND DIVISION FUND DIVISION
------------------------ ------------------------
1999 1998 1999 1998
-------- ------ ------- -------
<S> <C> <C> <C> <C>
Total gross deposits $ 20,212 $2,978 $41,552 $23,310
Transfers between fund divisions and
General American (72,338) 4,298 39,906 10,915
-------- ------ ------- -------
Total gross deposits and transfers
between fund divisions (52,126) 7,276 81,458 34,225
-------- ------ ------- -------
Deductions:
Premium load charges 9,225 420 19,244 3,441
Cost of insurance and administrative expenses 2,396 98 5,509 755
-------- ------ ------- -------
Total deductions 11,621 518 24,753 4,196
-------- ------ ------- -------
Net deposits into (withdrawals from)
Separate Account $(63,747) $6,758 $56,705 $30,029
======== ====== ======= =======
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
NON-US INCOME & GROWTH
FUND DIVISION FUND DIVISION
---------------------- -----------------------
1999 1998 1999<F**> 1998
------- ------ --------- ------
<S> <C> <C> <C> <C>
Total gross deposits $24,901 $3,248 $51,993 $ 126
Transfers between fund divisions and
General American 24,138 5,871 27,806 6,880
------- ------ ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 49,039 9,119 79,799 7,006
------- ------ ------- ------
Deductions:
Premium load charges 8,263 448 17,313 29
Cost of insurance and administrative expenses 3,119 184 7,281 132
------- ------ ------- ------
Total deductions 11,382 632 24,594 161
------- ------ ------- ------
Net deposits into Separate Account $37,657 $8,487 $55,205 $6,845
======= ====== ======= ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>The Variable Universal Life Insurance 98 product became available to this fund
on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
INTERNATIONAL VALUE
FUND DIVISION FUND DIVISION
------------------------ -----------------------
1999<F**> 1998 1999<F**> 1998
--------- ---- --------- ------
<S> <C> <C> <C> <C>
Total gross deposits $10,629 $258 $25,993 $ 93
Transfers between fund divisions and
General American 14,268 713 1,261 3,740
Surrenders and withdrawals 0 0 0 0
------- ---- ------- ------
Total gross deposits, transfers, and
surrenders between fund divisions 24,897 971 27,254 3,833
------- ---- ------- ------
Deductions:
Premium load charges 4,785 44 7,137 17
Cost of insurance and administrative expenses 3,739 74 1,689 30
------- ---- ------- ------
Total deductions 8,524 118 8,826 47
------- ---- ------- ------
Net deposits into Separate Account $16,373 $853 $18,428 $3,786
======= ==== ======= ======
<FN>
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>The Variable Universal Life Insurance 98 product became available to these funds
on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Variable Universal Life Insurance - 98:<F*>
- -------------------------------------------
<CAPTION>
SMALL COMPANY
BOND PORTFOLIO PORTFOLIO
FUND DIVISION FUND DIVISION
----------------------- -----------------------
1999<F**> 1998 1999<F**> 1998
--------- ------ --------- ------
<S> <C> <C> <C> <C>
Total gross deposits $ 9,118 $ 117 $18,644 $ 54
Transfers between fund divisions and
General American 1,306 3,219 26,022 3,034
------- ------ ------- ------
Total gross deposits and transfers
between fund divisions 10,424 3,336 44,666 3,088
------- ------ ------- ------
Deductions:
Premium load charges 3,529 14 5,354 12
Cost of insurance and administrative expenses 860 23 3,005 154
------- ------ ------- ------
Total deductions 4,389 37 8,359 166
------- ------ ------- ------
Net deposits into Separate Account $ 6,035 $3,299 $36,307 $2,922
======= ====== ======= ======
<F*>The Variable Universal Life Insurance 98 product was introduced in 1998, and the
first deposit was received on September 29, 1998.
<F**>The Variable Universal Life Insurance 98 product became available to these funds
on April 30, 1999.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
S & P 500 INDEX MONEY MARKET
FUND DIVISION FUND DIVISION
----------------------- ------------------------
1999 1998 1999 1998
-------- ------ --------- --------
<S> <C> <C> <C> <C>
Total gross deposits $148,524 $ 0 $ 646,197 $327,992
Transfers between fund divisions and
General American 183,394 1,201 (251,824) (21,803)
-------- ------ --------- --------
Total gross deposits and transfers
between fund divisions 331,918 1,201 394,373 306,189
-------- ------ --------- --------
Deductions:
Premium load charges 21,033 0 327,573 50,777
Cost of insurance and administrative expenses 15,334 24 16,814 14,164
-------- ------ --------- --------
Total deductions 36,367 24 344,387 64,941
-------- ------ --------- --------
Net deposits into Separate Account $295,551 $1,177 $ 49,986 $241,248
======== ====== ========= ========
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
BOND INDEX MANAGED EQUITY ASSET ALLOCATION
FUND DIVISION FUND DIVISION FUND DIVISION
---------------------- -------------- ----------------
1999 1998 1999 1999
------- ---- ------- -------
<S> <C> <C> <C> <C>
Total gross deposits $10,088 0 $ 5,156 $ 6,904
Transfers between fund divisions and
General American 55 $905 19,546 17,414
------- ---- ------- -------
Total gross deposits and transfers
between fund divisions 10,143 905 24,702 24,318
------- ---- ------- -------
Deductions:
Premium load charges 934 0 702 1,074
Cost of insurance and administrative expenses 636 24 320 1,595
------- ---- ------- -------
Total deductions 1,570 24 1,022 2,669
------- ---- ------- -------
Net deposits into Separate Account $ 8,573 $881 $23,680 $21,649
======= ==== ======= =======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
INTERNATIONAL INDEX MID-CAP EQUITY
FUND DIVISION FUND DIVISION
---------------------- ----------------------
1999 1998 1999 1998
------- ---- ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $12,937 $ 0 $20,543 $ 0
Transfers between fund divisions and
General American 734 905 0 1,752
------- ---- ------- ------
Total gross deposits and transfers
between fund divisions 13,671 905 20,543 1,752
------- ---- ------- ------
Deductions:
Premium load charges 1,043 0 2,004 0
Cost of insurance and administrative expenses 420 24 695 54
------- ---- ------- ------
Total deductions 1,463 24 2,699 54
------- ---- ------- ------
Net deposits into Separate Account $12,208 $881 $17,844 $1,698
======= ==== ======= ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
SMALL-CAP EQUITY EQUITY INCOME
FUND DIVISION FUND DIVISION
---------------------- ----------------------
1999 1998 1999 1998
------- ------ ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $19,313 $ 0 $18,515 $ 0
Transfers between fund divisions and
General American 347 1,692 8,184 2,609
------- ------ ------- ------
Total gross deposits and transfers
between fund divisions 19,660 1,692 26,699 2,609
------- ------ ------- ------
Deductions:
Premium load charges 2,807 0 2,920 0
Cost of insurance and administrative expenses 837 53 1,537 76
------- ------ ------- ------
Total deductions 3,644 53 4,457 76
------- ------ ------- ------
Net deposits into Separate Account $16,016 $1,639 $22,242 $2,533
======= ====== ======= ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
GROWTH OVERSEAS ASSET MANAGER
FUND DIVISION FUND DIVISION FUND DIVISION
--------------------- ---------------------- -------------
1999 1998 1999 1998 1999
------- ---- ------- ------ ----
<S> <C> <C> <C> <C> <C>
Total gross deposits $43,496 $ 0 $15,097 $ 0 $144
Transfers between fund divisions and
General American 11,264 905 1,000 1,706 0
------- ---- ------- ------ ----
Total gross deposits and transfers
between fund divisions 54,760 905 16,097 1,706 144
------- ---- ------- ------ ----
Deductions:
Premium load charges 8,888 0 1,866 0 0
Cost of insurance and administrative expenses 4,308 24 608 53 26
------- ---- ------- ------ ----
Total deductions 13,196 24 2,474 53 26
------- ---- ------- ------ ----
Net deposits into Separate Account $41,564 $881 $13,623 $1,653 $118
======= ==== ======= ====== ====
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
HIGH INCOME MULTI-SYTLE EQUITY
FUND DIVISION FUND DIVISION
---------------------- ----------------------
1999 1998 1999 1998
------- ------ ------- ------
<S> <C> <C> <C> <C>
Total gross deposits $10,880 $ 0 $ 9,127 $ 0
Transfers between fund divisions and
General American 0 1,711 4,922 4,306
------- ------ ------- ------
Total gross deposits and transfers
between fund divisions 10,880 1,711 14,049 4,306
------- ------ ------- ------
Deductions:
Premium load charges 913 0 4,155 0
Cost of insurance and administrative expenses 724 53 1,262 133
------- ------ ------- ------
Total deductions 1,637 53 5,417 133
------- ------ ------- ------
Net deposits into Separate Account $ 9,243 $1,658 $ 8,632 $4,173
======= ====== ======= ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
WORLDWIDE
EMERGING MARKETS CORE BOND
FUND DIVISION FUND DIVISION
---------------- ----------------------
1999 1999 1998
------- ------- ------
<S> <C> <C> <C>
Total gross deposits $(3,046) $ 263 $ 0
Transfers between fund divisions and
General American 0 128 1,708
------- ------- ------
Total gross deposits and transfers
between fund divisions (3,046) 391 1,708
------- ------- ------
Deductions:
Premium load charges 0 1,166 0
Cost of insurance and administrative expenses 146 295 50
------- ------- ------
Total deductions 146 1,461 50
------- ------- ------
Net deposits into (withdrawals from) Separate Account $(3,192) $(1,070) $1,658
======= ======= ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
AGGRESSIVE EQUITY NON-US
FUND DIVISION FUND DIVISION
----------------- ---------------------
1999 1999 1998
------- ------ ------
<S> <C> <C> <C>
Total gross deposits $5,046 $3,039 $ 0
Transfers between fund divisions and
General American 3 (110) 1,774
------ ------ ------
Total gross deposits and transfers
between fund divisions 5,049 2,929 1,774
------ ------ ------
Deductions:
Premium load charges 2,119 1,260 0
Cost of insurance and administrative expenses 537 298 52
------ ------ ------
Total deductions 2,656 1,558 52
------ ------ ------
Net deposits into Separate Account $2,393 $1,371 $1,722
====== ====== ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
INCOME & GROWTH INTERNATIONAL VALUE
FUND DIVISION FUND DIVISION FUND DIVISION
--------------- ------------- -------------
1999 1999 1999<F**>
------ ------ ---------
<S> <C> <C> <C>
Total gross deposits $2,399 $1,597 $1,014
Transfers between fund divisions and
General American 4,943 0 0
------ ------ ------
Total gross deposits and transfers
between fund divisions 7,342 1,597 1,014
------ ------ ------
Deductions:
Premium load charges 1,930 510 422
Cost of insurance and administrative expenses 613 338 119
------ ------ ------
Total deductions 2,543 848 541
------ ------ ------
Net deposits into Separate Account $4,799 $ 749 $ 473
====== ====== ======
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
(continued)
<PAGE>
<PAGE>
NOTE 7 - SUMMARY OF GROSS AND NET DEPOSITS INTO SEPARATE ACCOUNT, (CONTINUED)
Joint and Survivor Variable Universal Life Insurance - 98:<F*>
- --------------------------------------------------------------
<CAPTION>
BOND PORTFOLIO SMALL COMPANY
FUND DIVISION FUND DIVISION
-------------- -------------
1999 1999
------ ----
<S> <C> <C>
Total gross deposits $1,551 $981
Deductions:
Premium load charges 632 211
Cost of insurance and administrative expenses 237 315
------ ----
Total deductions 869 526
------ ----
Net deposits into Separate Account $ 682 $455
====== ====
<FN>
<F*>The Joint and Survivor Variable Universal Life Insurance 98 product was introduced in 1998,
and the first deposit was received on October 14, 1998.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<CAPTION>
No. of Shares Market Value
--------------- --------------
<S> <C> <C>
S & P 500 Index Fund
General American Capital Company <F*> 999,187 $60,824,360
Money Market Fund
General American Capital Company <F*> 489,328 9,910,022
Bond Index Fund
General American Capital Company <F*> 250,830 6,136,371
Managed Equity Fund
General American Capital Company <F*> 173,817 6,380,710
Asset Allocation Fund
General American Capital Company <F*> 401,176 18,584,088
International Index Fund <F**>
General American Capital Company <F*> 507,022 13,006,687
Mid-Cap Equity Fund <F***>
General American Capital Company <F*> 337,135 8,364,930
Small-Cap Equity Fund
General American Capital Company <F*> 69,740 2,918,058
Equity-Income Fund
Variable Insurance Products Fund 939,971 24,166,662
Growth Fund
Variable Insurance Products Fund 1,014,256 55,713,063
Overseas Fund
Variable Insurance Products Fund 548,542 15,052,006
Asset Manager Fund
Variable Insurance Products Fund II 129,586 2,419,380
High Income Fund
Variable Insurance Products Fund 386,909 4,375,944
Worldwide Hard Assets Fund <F****>
Van Eck Worldwide Insurance Trust 28,930 317,077
Worldwide Emerging Markets Fund
Van Eck Worldwide Insurance Trust 18,240 260,096
<FN>
<F*>These funds use consent dividending. See Note 2C.
<F**>This fund was formerly known as the International Equity Fund.
<F***>This fund was formerly known as the Special Equity Fund.
<F****>This fund was formerly known as the Gold & Natural Resources Fund
See accompanying notes to financial statements. (continued)
<PAGE>
<PAGE>
GENERAL AMERICAN SEPARATE ACCOUNT ELEVEN
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 1999
<CAPTION>
No. of Shares Market Value
--------------- --------------
<S> <C> <C>
Multi-Style Equity Fund
Russell Insurance Funds 1,014,829 $17,038,971
Core Bond Fund
Russell Insurance Funds 1,018,988 9,823,042
Aggressive Equity Fund
Russell Insurance Funds 364,662 4,871,881
Non-US Fund
Russell Insurance Funds 353,166 5,011,427
Income & Growth Fund
American Century Variable Portfolios 92,034 736,269
International Fund
American Century Variable Portfolios 48,347 604,334
Value Fund
American Century Variable Portfolios 16,164 96,178
Bond Portfolio
J.P. Morgan Series Trust II 12,590 141,513
Small Company Portfolio
J.P. Morgan Series Trust II 35,632 596,119
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE>
LEGAL COUNSEL
Stephen E. Roth
Sutherland, Asbill & Brennan, Washington, D.C.
INDEPENDENT AUDITORS
KPMG LLP
If distributed to prospective investors, this report must be preceded or
accompanied by a current prospectus.
The prospectus is incomplete without reference to the financial data
contained in the annual report.
<PAGE>
<PAGE>
GENERAL AMERICAN LIFE INSURANCE
COMPANY AND SUBSIDIARIES
Consolidated Financial Statements
December 31, 1999 and 1998
(With Independent Auditors' Report Thereon)
<PAGE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Members of General American Life Insurance
Company:
We have audited the accompanying consolidated balance sheets of General
American Life Insurance Company and subsidiaries as of December 31, 1999
and 1998, and the related consolidated statements of operations,
comprehensive income, stockholder equity, and cash flows for each of the
years in the three-year period ended December 31, 1999. These
consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
General American Life Insurance Company and subsidiaries as of December
31, 1999 and 1998, and the results of their operations and their cash
flows for each of the years in the three-year period ended December 31,
1999, in conformity with generally accepted accounting principles.
St. Louis, Missouri
February 4, 2000
<PAGE>
<PAGE>
<TABLE>
General American Life Insurance Company and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(dollars in millions, except share data)
<CAPTION>
As of December 31
-----------------
1999 1998
--------- --------
<S> <C> <C>
ASSETS
- ----------------------------------------------------------------
Fixed maturities:
Available-for-sale, at fair value $ 6,826.1 11,068.3
Mortgage loans, net 1,678.9 2,337.5
Real estate, net 127.2 129.9
Equity securities, at fair value 49.3 48.6
Policy loans 2,243.9 2,151.0
Short-term investments 292.4 195.3
Other invested assets 898.8 457.6
--------- --------
Total investments 12,116.6 16,388.2
Cash and cash equivalents 790.0 591.1
Accrued investment income 153.9 205.6
Reinsurance recoverables 863.3 905.0
Other contract deposits 325.5 4,094.8
Deferred tax asset, net 197.6 -
Deferred policy acquisition costs 1,286.1 773.8
Other assets 781.1 675.7
Separate account assets 6,915.6 5,214.8
--------- --------
Total assets $23,429.7 28,849.0
========= ========
LIABILITIES AND STOCKHOLDER EQUITY
- ----------------------------------------------------------------
Policy and contract liabilities:
Future policy benefits $ 5,995.6 5,589.5
Policyholder account balances:
Universal life 3,032.1 2,960.9
Annuities 3,709.8 3,714.5
Pension funds and interest sensitive contract liabilities 556.8 7,581.3
Policy and contract claims 702.1 591.1
Dividends payable to policyholders 120.6 121.7
--------- --------
Total policy and contract liabilities 14,117.0 20,559.0
Amounts payable to reinsurers 79.2 201.4
Long-term debt and notes payable 216.6 221.9
Other liabilities and accrued expenses 825.0 912.4
Deferred tax liability, net - 75.4
Separate account liabilities 6,892.0 5,194.9
--------- --------
Total liabilities 22,129.8 27,165.0
Minority interests 420.0 383.1
Stockholder equity:
Common stock, $1 par value, 5,000,000 shares authorized,
3,000,000 shares issued and outstanding 3.0 3.0
Additional paid in capital 71.1 3.0
Retained earnings 1,074.1 1,242.0
Accumulated other comprehensive (loss) income (268.3) 52.9
--------- --------
Total stockholder equity 879.9 1,300.9
--------- --------
Total liabilities and stockholder equity $23,429.7 28,849.0
========= ========
See accompanying notes to consolidated financial statements.
</TABLE>
2
<PAGE>
<PAGE>
<TABLE>
General American Life Insurance Company and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in millions)
<CAPTION>
Years ended December 31
-----------------------
1999 1998 1997
-------- ------- -------
<S> <C> <C> <C>
REVENUES
- -------------------------------------------------------
Insurance premiums $2,207.6 2,028.0 1,671.3
Other considerations 183.2 173.6 135.8
Net investment income 1,157.2 1,135.8 945.5
Ceded commissions 21.7 39.9 44.9
Other income 386.0 323.0 362.3
Net realized investment (losses) gains (200.6) 13.7 28.5
-------- ------- -------
Total revenues 3,755.1 3,714.0 3,188.3
-------- ------- -------
BENEFITS AND EXPENSES
- -------------------------------------------------------
Policy benefits 1,978.4 1,832.9 1,517.7
Interest credited to policyholder account balances 533.9 516.8 399.4
-------- ------- -------
Total policyholder benefits 2,512.3 2,349.7 1,917.1
Dividends to policyholders 191.6 192.1 182.1
Policy acquisition costs 154.0 240.7 171.1
Other insurance and operating expenses 917.5 713.7 712.8
Interest expense 17.7 17.9 20.2
Demutualization expense 13.3 - -
Fees to exit funding agreement business 141.4 - -
-------- ------- -------
Total benefits and expenses 3,947.8 3,514.1 3,003.3
-------- ------- -------
(Loss) income before provision for income taxes (192.7) 199.9 185.0
-------- ------- -------
Income tax (benefit) provision:
Current (23.6) 35.2 65.8
Deferred (40.7) 18.4 (0.1)
-------- ------- -------
Total income tax (benefit) provision (64.3) 53.6 65.7
-------- ------- -------
(Loss) income before minority interest (128.4) 146.3 119.3
Minority interest in earnings of consolidated subsidiaries (24.8) (29.2) (22.1)
-------- ------- -------
Net (loss) income $ (153.2) 117.1 97.2
======== ======= =======
See accompanying notes to consolidated financial statements.
</TABLE>
3
<PAGE>
<PAGE>
<TABLE>
General American Life Insurance Company and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(dollars in millions)
<CAPTION>
Years ended December 31
-----------------------
1999 1998 1997
------- ----- -----
<S> <C> <C> <C>
Net (loss) income $(153.2) 117.1 97.2
Other comprehensive (loss) income (321.2) (54.0) 75.6
------- ----- -----
Comprehensive (loss) income $(474.4) 63.1 172.8
======= ===== =====
See accompanying notes to consolidated financial statements.
</TABLE>
4
<PAGE>
<PAGE>
<TABLE>
General American Life Insurance Company and Subsidiaries
CONSOLIDATED STATEMENTS OF STOCKHOLDER EQUITY
(dollars in millions)
<CAPTION>
ACCUMULATED
OTHER
ADDITIONAL COMPREHENSIVE TOTAL
COMMON PAID-IN RETAINED (LOSS) STOCKHOLDER
STOCK CAPITAL EARNINGS INCOME EQUITY
------ ---------- -------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1996 $ - - 966.5 31.3 997.8
Net income 97.2 97.2
Other comprehensive income 75.6 75.6
Issuance of common stock 3.0 3.0 (6.0) -
Dividend to parent (4.5) (4.5)
Other, net 4.4 4.4
---- ---- ------- ------ -------
Balance at December 31, 1997 3.0 3.0 1,057.6 106.9 1,170.5
Net income 117.1 117.1
Other comprehensive loss (54.0) (54.0)
Parent's share of subsidiary's
issuance of non-voting stock 68.6 68.6
Other, net (1.3) (1.3)
---- ---- ------- ------ -------
Balance at December 31, 1998 3.0 3.0 1,242.0 52.9 1,300.9
Net loss (153.2) (153.2)
Other comprehensive loss (321.2) (321.2)
Parent's share of subsidiaries'
capital stock transactions 25.3 25.3
Capital contribution from parent 68.1 68.1
Dividends (40.0) (40.0)
---- ---- ------- ------ -------
Balance at December 31, 1999 $3.0 71.1 1,074.1 (268.3) 879.9
==== ==== ======= ====== =======
See accompanying notes to consolidated financial statements.
</TABLE>
5
<PAGE>
<PAGE>
<TABLE>
General American Life Insurance Company and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in millions)
<CAPTION>
Years ended December 31
-----------------------
1999 1998 1997
--------- ------- -------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
- ----------------------------------------------------------------
Net (loss) income $ (153.2) 117.1 97.2
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Change in:
Accrued investment income 50.9 (37.4) (20.6)
Reinsurance recoverables and
other contract deposits 463.9 496.1 203.7
Deferred policy acquisition costs (165.9) (102.1) (113.0)
Other assets (39.5) (172.1) (61.8)
Future policy benefits 406.2 655.5 693.1
Policy and contract claims 111.0 132.5 105.5
Other liabilities and accrued expenses (78.1) 48.2 319.8
Deferred income tax provision (40.7) 18.4 (0.1)
Policyholder considerations (183.2) (173.6) (135.8)
Interest credited to policyholder account balances 533.9 516.8 399.4
Amortization and depreciation (32.5) 34.6 32.7
Net realized investment losses (gains) 200.6 (13.7) (28.5)
Other, net 12.0 7.4 0.4
--------- ------- -------
Net cash provided by operating activities 1,085.4 1,527.7 1,492.0
--------- ------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
- ----------------------------------------------------------------
Proceeds from investments sold or redeemed:
Fixed maturities available-for-sale 10,891.4 2,027.4 2,070.7
Mortgage loans 1,442.8 370.4 594.2
Equity securities 10.3 2.1 31.6
Cost of investments purchased:
Fixed maturities available-for-sale (8,110.5) (4,251.1) (4,463.1)
Mortgage loan originations (800.2) (594.5) (439.0)
Equity securities (19.2) (17.4) (47.3)
Maturity of fixed maturities available-for-sale 310.6 145.3 281.7
Increase in policy loans, net (92.9) (77.9) (153.4)
Increase in short-term and other invested assets, net (521.8) (215.2) (130.4)
Investments in subsidiaries 81.3 (24.5) (6.0)
--------- ------- -------
Net cash provided by (used in) investing activities 3,191.8 (2,635.4) (2,261.0)
--------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
- ----------------------------------------------------------------
Net policyholder account and contract (withdrawals) deposits (4,186.7) 1,108.8 1,024.5
Proceeds from subsidiary stock offering 124.9 221.8 -
Issuance of debt - 2.3 1.9
Repayment of debt (0.7) (0.4) (80.6)
Dividends (45.8) (3.8) (2.1)
Other, net 28.9 27.5 46.8
--------- ------- -------
Net cash (used in) provided by financing activities (4,079.4) 1,356.2 990.5
--------- ------- -------
Effect of exchange rate changes 1.1 (16.3) (5.3)
--------- ------- -------
Net increase in cash and cash equivalents 198.9 232.2 216.2
Cash and cash equivalents at beginning of year 591.1 358.9 142.7
--------- ------- -------
Cash and cash equivalents at end of year $ 790.0 591.1 358.9
========= ======= =======
See accompanying notes to consolidated financial statements.
</TABLE>
6
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(1) BASIS OF PRESENTATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
ACQUISITION BY METLIFE
On January 6, 2000, Metropolitan Life Insurance Company (MetLife),
headquartered in New York City, purchased 100% of GenAmerica Corporation
(GenAmerica), General American Life Insurance Company's (General American
or the Company) parent, for $1.2 billion in cash. The acquisition was a
result of liquidity problems encountered by General American.
On August 10, 1999, at management's request, the Missouri Department of
Insurance placed the Company under an order of administrative supervision
(the order). The immediate cause of the order was the Company's inability
to immediately satisfy approximately $4 billion in institutional funding
agreement contract surrenders. The funding agreements guaranteed the
holder a return on principal at a stated interest rate for a specified
period of time. The contracts also allowed the holder to "put" the
contract to the Company for a payout of principal and interest within
designated time periods of 7, 30 or 90 days. The Company had reinsured 50%
of the funding agreement contracts with ARM Financial Group, Inc. (ARM).
In July 1999, Moody's Investors Services, Inc. downgraded the claims paying
ability rating of ARM due to the relative illiquidity of certain of its
invested assets, which resulted in the Company recapturing the obligations
and assets related to the funding agreements reinsured by ARM. As a result
of the recapture, Moody's downgraded the Company's claims paying ability
rating. Upon announcement of the downgrade, a large number of funding
agreement holders surrendered their contracts. The Company was unable to
liquidate sufficient assets in an orderly fashion without incurring
significant losses and therefore management requested the order.
In connection with the acquisition, MetLife offered each holder of a
General American funding agreement the option to exchange its funding
agreement for a MetLife funding agreement with substantially identical
terms and conditions or receive cash equal to the principal amount plus
accrued interest. In consideration of this exchange offer, the Company
transferred to MetLife assets having a market value equal to the market
value of the funding agreement liabilities, approximately $5.7 billion.
As a result of its efforts to raise liquidity to meet the funding agreement
requests and the transfer of assets to MetLife, the Company incurred
approximately $214.7 million in pretax capital losses. In addition to the
capital losses, the Company incurred $141.4 million in fees associated with
the recapture and transfer of the funding agreement business. With the
transfer, the Company fully exited the funding agreement business.
GenAmerica will operate as a wholly-owned stock subsidiary of MetLife.
The $1.2 billion purchase price was paid to GenAmerica's parent General
American Mutual Holding Company (GAMHC) and deposited in an account for the
benefit of the Company's policyholders. Ultimately, these funds, minus
adjustments, will be distributed to participating General American
policyholders, with accumulated interest and GAMHC will be dissolved.
7
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
REORGANIZATION
In September 1996, the Board of Directors of General American adopted the
Plan which authorized the reorganization (Reorganization) of the Company
into a mutual insurance holding company structure. The Missouri Department
of Insurance held a public hearing on the Reorganization on December 19,
1996 and approved the Plan on January 24, 1997. The policyholders of the
Company approved the Plan on January 28, 1997 and the Reorganization became
effective on April 24, 1997 (effective date). The Company was the first
company to obtain approval and to form a mutual insurance holding company
under the Missouri Mutual Holding Company Statute.
Pursuant to the Reorganization, the Company (i) formed GAMHC as a mutual
insurance holding company under the insurance laws of the State of
Missouri, (ii) formed GenAmerica as an intermediate stock holding company
under the general laws of the State of Missouri, and (iii) amended and
restated its Charter and Articles of Incorporation to authorize the
issuance of capital stock and the continuance of its existence as a stock
life insurance company under the same name. GAMHC may, among other things,
elect all of the directors of GenAmerica and approve matters submitted for
shareholder approval. As of the effective date of the Reorganization, the
membership interests and the contractual rights of the policyholders of the
Company were separated - the membership interests automatically became, by
operation of law, membership interests in GAMHC and the contractual rights
remained with the Company. Each person who became the owner of a
designated policy or contract of insurance or annuity issued by the Company
after the effective date of the Reorganization (subject to certain
exceptions and conditions set forth in the Articles of Incorporation of
GAMHC) became a member of GAMHC and had a membership interest in GAMHC by
operation of law so long as such policy or contract remains in force. The
membership interests in GAMHC follow, and are not severable, from the
insurance or annuity policy or contract from which the membership interest
in GAMHC is derived.
On the effective date, the Company issued three million shares of its
authorized shares of capital stock to GAMHC. GAMHC then contributed all of
these to GenAmerica in exchange for one thousand shares of its common
stock. As a result, GenAmerica directly owned the Company, and GAMHC
indirectly owned the Company, through GenAmerica. The Reorganization was
accounted for at historical cost in a manner similar to a pooling of
interests.
The consolidated financial statements include the assets, liabilities, and
results of operations of the Company and the following wholly owned
insurance subsidiaries: Cova Corporation (COVA), an insurance holding
company, Paragon Life Insurance Company, Security Equity Life Insurance
Company, General Life Insurance Company of America, General Life Insurance
Company (GLIC), GenAm Benefits Insurance Company, and its 48.3 percent
owned subsidiary, Reinsurance Group of America, Incorporated (RGA), an
insurance holding company. In addition, the financial statements include
the assets, liabilities, and results of operations of the following wholly
owned non-insurance subsidiaries: Red Oak Realty Company, White Oak
Royalty Company, GenMark, Inc., and its 60.4 percent owned subsidiary,
Conning Corporation (Conning).
The Company's principal lines of business, conducted through General
American or one of its subsidiaries, are: Individual Life Insurance,
Annuities, Group Life and Health Insurance, Asset Management, and
Reinsurance. The Company distributes its products and services primarily
through a nationwide network of general agencies, independent brokers, and
group sales and claims offices. The Company and its subsidiaries are
licensed to do business in all fifty states, ten Canadian provinces, Puerto
Rico, and the District of Columbia. Through its subsidiaries, the Company
has operations in Europe, Pacific Rim countries, Latin America, and Africa.
INITIAL PUBLIC OFFERING
In December 1997, Conning successfully completed an Initial Public Offering
of 2.875 million shares of its common stock. Conning received net proceeds
of approximately $34.5 million from the offering. The
8
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
Company owned 60.4 and 62.7 percent of the total shares outstanding of
Conning's common stock at December 31, 1999 and 1998 respectively. The
publicly held stock of Conning is listed on the NASDAQ National Market
System.
OTHER OFFERINGS
At RGA's annual stockholders' meeting on May 27, 1998, a new class of non-
voting common stock was authorized. In June 1998, RGA completed a
secondary public offering in which it sold 7,417,500 million shares of non-
voting common stock traded on the New York Stock Exchange under the symbol
RGA.A. The offering provided net proceeds of approximately $221.8 million,
which have been utilized to finance the continued growth of RGA's
operations domestically and internationally. After the subsequent
offering, the Company's ownership percentage decreased from 63.8% to 53.3%.
On September 14, 1999 RGA held a special shareholder's meeting at which an
amendment to its restated articles of incorporation, as amended, was
approved which converted 7,417,496 shares of non-voting common stock into
7,194,971 shares of voting common stock, with cash paid in lieu of any
fractional shares. After the non-voting stock conversion, the Company's
ownership percentage was 53.5%.
On November 23, 1999, RGA completed a private placement of securities in
which it sold 4,784,689 shares of its common stock, $0.01 par value per
share to MetLife. The price per share was $26.125, and the aggregate value
of the transaction was approximately $125 million. Proceeds from the
private placement will be used for general corporate purposes, including
the immediate capital needs associated with the Company's primary
businesses. After the private offering, the Company's ownership percentage
was 48.3%.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying consolidated financial statements are prepared on the
basis of generally accepted accounting principles (GAAP) and include the
accounts of the Company and its majority owned subsidiaries. Less than
majority-owned entities in which the Company has at least a 20 percent
interest are reported on the equity basis. The Company continues to
consolidate the financial statements of RGA even though its ownership
percentage has declined to below 50 percent since the Company has retained
control of RGA through a majority representation on RGA's Board of
Directors at December 31, 1999 and through January 6, 2000. All
significant intercompany accounts and transactions have been eliminated in
consolidation. The preparation of financial statements requires the use of
estimates by management, which affect the amounts reflected in the
financial statements. Actual results could differ from those estimates.
Accounts that the Company deems to be sensitive to changes in estimates
include future policy benefits and policy and contract claims, deferred
acquisition costs, and investment and deferred tax valuation allowances.
The significant accounting policies of the Company are as follows:
RECOGNITION OF REVENUE
For traditional life insurance policies, including participating
businesses, premiums are recognized when due, less allowances for estimated
uncollectible balances. For limited payment contracts, net premiums are
recorded as revenue, and the difference between the gross premium and the
net premium is deferred and recognized in income in a constant relationship
to insurance in force over the estimated policy life.
For universal life and annuity products, contract charges for mortality,
surrender, and expense, other than front-end expense charges, are reported
as income when charged to policyholders' accounts.
Other income represents the fees generated from the Company's non-insurance
operations, primarily service and contract fees relating to concessions,
asset management, system development, and third-party administration.
Amounts are recognized when earned.
9
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
INVESTED ASSETS
FIXED MATURITIES AND EQUITY SECURITIES: All of the Company's securities are
classified as available-for-sale. Fixed maturities available-for-sale are
reported at fair value and are so classified based on the possibility that
such securities could be sold prior to maturity if that action enables the
Company to execute its investment philosophy and appropriately match
investment results to operating and liquidity needs. Equity securities are
carried at fair value.
Realized gains or losses on the sale of securities are determined on the
basis of specific identification. Unrealized gains and losses are
recorded, net of related income tax effects as well as related adjustments
to deferred acquisition costs, in accumulated other comprehensive income, a
separate component of stockholder equity.
The Company recognizes its proportionate share of the resultant gains or
losses on the issuance or repurchase of its subsidiaries' stock as a direct
credit or charge to retained earnings.
MORTGAGE LOANS: Mortgage loans on real estate are stated at an unpaid
principal balance, net of unamortized discounts, and valuation allowances
for possible impairment in value. The Company discontinues the accrual of
interest on mortgage loans which are more than 90 days delinquent.
Interest received on nonaccrual mortgage loans is generally reported as
interest income.
POLICY LOANS, REAL ESTATE AND OTHER INVESTED ASSETS: Policy loans are
carried at an unpaid principal balance and are generally secured by the
cash surrender value of the underlying contracts. Investment real estate
which the Company intends to hold for the production of income is carried
at depreciated cost, net of writedowns for other than temporary declines in
fair value and encumbrances. Properties held for sale (primarily acquired
through foreclosure) are carried at the lower of depreciated cost (fair
value at foreclosure plus capital additions less accumulated depreciation
and encumbrances) or fair value. Adjustments to carrying value of
properties held for sale are recorded in a valuation reserve when the fair
value is below depreciated cost. The accumulated depreciation and
encumbrances on real estate amounted to $44.0 million and $52.4 million at
December 31, 1999 and 1998, respectively. Direct valuation allowances
amounted to $4.7 million and $7.3 million at December 31, 1999 and 1998,
respectively. Other invested assets are principally recorded at fair
value.
SHORT-TERM INVESTMENTS: Short-term investments, consisting primarily of
money market instruments and other debt issues purchased with an original
maturity of less than a year, are carried at amortized cost, which
approximates fair value.
INVESTED ASSET IMPAIRMENT AND VALUATION ALLOWANCES: Invested assets are
considered impaired when the Company determines that collection of all
amounts due under the contractual terms is doubtful. The Company adjusts
invested assets to their estimated net realizable value at the point at
which it determines an impairment is other than temporary. In addition,
the Company has established valuation allowances for mortgage loans and
other invested assets. Valuation allowances for other than temporary
impairments in value are netted against the asset categories to which they
apply. Additions to valuation allowances are included in realized gains
and losses.
10
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
CASH AND CASH EQUIVALENTS: For purposes of reporting cash flows, cash and
cash equivalents represent cash, demand deposits, and highly liquid short-
term investments, which include U.S. Treasury bills, commercial paper, and
repurchase agreements with original or remaining maturities of 90 days or
less when purchased.
INVESTMENT INCOME
Fixed maturity premium and discounts are amortized into income using the
scientific yield method over the term of the security. Amortization of the
premium or discount on mortgage-backed securities is recognized using a
scientific yield method which considers the estimated timing and amount of
prepayments of underlying mortgage loans. Actual prepayment experience is
periodically reviewed and effective yields are adjusted when differences
arise between the prepayments originally anticipated and the actual
prepayments received and those prepayments currently anticipated. When
such differences occur, the net investment in the mortgage-backed security
is adjusted to the amount that would have existed had the new effective
yield been applied since the acquisition of the security with a
corresponding charge or credit to interest income (the "retrospective
method").
POLICY AND CONTRACT LIABILITIES
For traditional life insurance policies, future policy benefits are
computed using a net level premium method taking into account actuarial
assumptions as to mortality, persistency, and interest established at
policy issue. Assumptions established at policy issue as to mortality and
persistency are based on industry standards and the Company's historical
experience which, together with interest and expense assumptions, provide a
margin for adverse deviation. Interest rate assumptions generally range
from 2.5 percent to 11.0 percent. When the liabilities for future policy
benefits plus the present value of expected future gross premiums are
insufficient to provide for expected policy benefits and expenses,
unrecoverable deferred policy acquisition costs are written off and
thereafter a premium deficiency reserve is established through a charge to
earnings.
For participating policies, future policy benefits are computed using a net
level premium method based on the guaranteed cash value basis for mortality
and interest. Mortality rates are similar to those used for statutory
valuation purposes. Interest rates generally range from 2.5 percent to 6.0
percent. Dividend liabilities are established when earned.
Policyholder account balances for universal life and annuity policies are
equal to the policyholder account value before deduction of any surrender
charges. The policyholder account value represents an accumulation of
gross premium payments plus credited interest less expense, mortality
charges, and withdrawals. These expense charges are recognized in income
as earned.
The range of weighted average interest crediting rates used by the
Company's life insurance subsidiaries were as follows:
1999 1998 1997
Universal life 4.00-8.00% 5.25-7.10% 6.00-7.10%
Annuities 3.00-9.10% 4.00-9.20% 5.70-9.30%
Accident and health benefits for active lives are calculated using the net
level premium method and assumptions as to future morbidity, withdrawals,
and interest, which provide a margin for adverse deviation. Benefit
liabilities for disabled lives are calculated using the present value of
future benefits and experience assumptions for claim termination, expense,
and interest which also provide a margin for adverse deviation.
11
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
POLICY AND CONTRACT CLAIMS
The Company establishes a liability for unpaid claims based on estimates of
the ultimate cost of claims incurred, which is comprised of aggregate case
basis estimates, average claim costs for reported claims, and estimates of
incurred but not reported losses based on past experience. Policy and
contract claims include a provision for both life and accident and health
claims. Management believes the liabilities for unpaid claims are adequate
to cover the ultimate liability; however, due to the underlying risks and
the high degree of uncertainty associated with the determination of the
liability for unpaid claims, the amounts which will ultimately be paid to
settle these liabilities cannot be precisely determined and may vary from
the estimated amount included in the consolidated balance sheets.
DEFERRED POLICY ACQUISITION COSTS
The costs, which vary with and are primarily related to the production of
new and renewal business, have been deferred to the extent that such costs
are deemed recoverable from future profitability of the underlying
business. Such costs include commissions, premium taxes, as well as
certain other costs of policy issuance and underwriting.
For limited payment and other nonparticipating traditional life insurance
policies, the deferred policy acquisition costs are amortized, with
interest, in proportion to the ratio of the expected annual premium revenue
to the expected total premium revenue. Expected future premium revenue is
estimated utilizing the same assumptions used for computing liabilities for
future policy benefits for these policies.
For participating life insurance, universal life, and annuity type
contracts, the deferred policy acquisition costs are amortized over a
period of not more than thirty years in relation to the present value of
estimated gross profits arising from interest margin, cost of insurance,
policy administration, and surrender charges.
The range of average rates of assumed interest used by the Company's
insurance subsidiaries in estimated gross margins were as follows:
1999 1998 1997
Participating life 7.76% 8.25% 8.17%
Universal life 6.00-9.20% 6.25-7.50% 6.25-7.79%
Annuities 3.00-7.00% 7.00-7.83% 7.00-7.84%
The estimates of expected gross margins are evaluated regularly and are
revised if actual experience or other evidence indicates that revision is
appropriate. Upon revision, total amortization recorded to date is
adjusted by a charge or credit to current earnings. Deferred policy
acquisition costs are adjusted for the impact on estimated gross margins as
if the net unrealized gains and losses on securities had actually been
realized.
REINSURANCE AND OTHER CONTRACT DEPOSITS
In the normal course of business, the Company seeks to limit its exposure
to loss on any single insured by ceding risks to other insurance
enterprises or reinsurers under various types of contracts including
coinsurance and excess coverage. The Company's retention level per
individual life ranges between $50 thousand and $2.5 million depending on
the entity writing the policy.
The Company assumes and retrocedes financial reinsurance contracts, which
represent low mortality risk reinsurance treaties. These contracts are
reported as deposits and are included in other contract deposits in the
consolidated balance sheets. The amount of revenue reported on these
contracts represents fees and the cost of insurance under the terms of the
reinsurance agreement.
12
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
Reinsurance activities are accounted for consistent with terms of the
underlying contracts. Premiums ceded to other companies have been reported
as a reduction of premiums. Amounts applicable to reinsurance ceded for
future policy benefits and claim liabilities have been reported as assets
for these items, and commissions and expense allowances received in
connection with reinsurance ceded have been accounted for in income as
earned. Reinsurance does not relieve the Company from its primary
responsibility to meet claim obligations. The Company evaluates the
financial conditions of its reinsurers annually.
FEDERAL INCOME TAXES
The Company and certain of its U.S. subsidiaries file consolidated federal
income tax returns. Any acquired life insurance company is not included in
the consolidated return until the acquired company has been a member of the
consolidated group for five years. Prior to satisfying the five-year
requirement, the subsidiary files a separate federal return. RGA Barbados,
a subsidiary of RGA, also files a U.S. tax return. The Company's foreign
subsidiaries are taxed under applicable local statutes. No deferred tax
liabilities have been recognized for the foreign subsidiaries per
Accounting Principles Board (APB) Opinion 23, Accounting for Income Taxes -
Special Areas.
The Company uses the asset and liability method to record deferred income
taxes. Accordingly, deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and liabilities and
their respective tax bases, using enacted tax rates, expected to apply to
taxable income in the years in which those temporary differences are
expected to be recovered or settled. The Company has not recognized a
deferred tax liability for the excess of financial statement carrying
amount over the tax basis of its less-than-80 percent owned domestic
subsidiaries as the tax law provides a means by which the reported amount
of that investment can be recovered tax-free and the Company expects that
it will ultimately use that means.
SEPARATE ACCOUNT BUSINESS
The assets and liabilities of the separate account represent segregated
funds administered and invested by the Company for purposes of funding
variable life insurance and annuity contracts for the exclusive benefit of
the contractholders.
The Company charges the separate account for cost of insurance and
administrative expense associated with a contract and charges related to
early withdrawals by contractholders. The assets and liabilities of the
separate account are carried at fair value. The Company's participation in
the separate account (seed money) is carried at fair value in the separate
account, and amounted to $27.2 million and $19.9 million at December 31,
1999 and 1998, respectively.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value estimates are made at a specific point in time, based on
relevant market information and information about the financial instrument.
These estimates do not reflect any premium or discount that could result
from offering for sale at one time the Company's entire holdings of a
particular financial instrument. Although fair value estimates are
calculated using assumptions that management believes are appropriate,
changes in assumptions could significantly affect the estimates and such
estimates should be used with care. The following assumptions were used to
estimate the fair value of each class of financial instrument for which it
was practicable to estimate fair value:
INVESTMENT SECURITIES: Fixed maturities are valued using quoted market
prices, if available. For securities not actively traded, fair values are
estimated using values obtained from independent pricing services or in the
case of private placements are estimated by discounting expected future
cash flows using a current market rate applicable to the yield, credit
quality, and maturity of investments. The fair values of equity securities
are based on quoted market prices.
13
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
DERIVATIVES: Derivatives are valued using quoted market prices, if
available. For derivatives not actively traded, fair values are estimated
using values obtained from independent pricing services.
MORTGAGE LOANS: The fair values of mortgage loans are estimated using
discounted cash flow analyses and interest rates currently being offered
for similar loans to borrowers with similar credit ratings. Loans with
similar characteristics are aggregated for purposes of the calculations.
POLICY LOANS: The fair value of policy loans approximates the carrying
value. The majority of these loans are indexed, with a yield tied to a
stated return.
POLICYHOLDER ACCOUNT BALANCES ON INVESTMENT TYPE CONTRACTS: Fair values for
the Company's liabilities under investment-type contracts are estimated
using cash surrender values. For contracts with no defined maturity date,
the carrying value approximates fair value.
PENSION FUNDS AND INTEREST SENSITIVE CONTRACT LIABILITIES: Fair values for
the Company's interest sensitive contract liabilities are estimated using
cash surrender values. For contracts with no defined maturity date, the
carrying value approximates fair value.
SEPARATE ACCOUNT ASSETS AND LIABILITIES: The separate account assets and
liabilities are carried at fair value as determined by the market value of
the underlying segregated investments.
SHORT-TERM INVESTMENTS AND CASH AND CASH EQUIVALENTS: The carrying amount
approximates fair value.
LONG-TERM DEBT AND NOTES PAYABLE: The fair value of long-term debt and
notes payable is estimated using discounted cash flow calculations based on
interest rates currently being offered for similar instruments.
Refer to Note 3 & Note 4 for additional information on fair value of
financial instruments.
NEW ACCOUNTING STANDARDS
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 133, Accounting for Derivative
Instruments and Hedging Activities, effective for fiscal years beginning
after June 15, 2000, and is effective for interim periods in the initial
year of adoption. SFAS No. 133 requires companies to record derivatives on
the balance sheet as assets or liabilities, measured at fair value. It
also requires that gains or losses resulting from changes in the values of
those derivatives be reported depending on the use of the derivative and
whether it qualifies for hedge accounting. The Company has not yet
determined the effect of the implementation of SFAS No. 133 on the results
of operation, financial position, or liquidity. The Company plans to adopt
the provisions of SFAS No. 133 in 2001.
RECLASSIFICATION
The Company has reclassified the presentation of certain prior period
information to conform to the 1999 presentation.
(2) ACQUISITIONS AND DIVESTITURES
On September 30, 1999, the Company sold its 100 percent ownership in
Consultec, LLC to ACS Enterprise Solutions, Inc. Proceeds received net of
expenses were $65.7 million and the realized gain, net of tax, on the sale
was $28.4 million.
14
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(3) INVESTMENTS
Fixed Maturities and Equity Securities
The amortized cost and estimated fair value of fixed maturities and equity
securities at December 31, 1999 and 1998 are as follows (in millions):
<TABLE>
<CAPTION>
1999
- ---------------------------------------------------------------------------------------------
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Available-for-sale:
U. S. Treasury securities $ 88.6 0.2 (4.8) 84.0
Government agency
obligations 686.8 55.3 (54.8) 687.3
Corporate securities 4,298.6 104.6 (318.2) 4,085.0
Mortgage-backed securities 970.3 1.2 (106.7) 864.8
Asset-backed securities 1,441.5 1.0 (337.5) 1,105.0
-------- ----- ------ -------
Total fixed maturities
available-for-sale $7,485.8 162.3 (822.0) 6,826.1
======== ===== ====== =======
Equity securities $ 42.7 9.5 (2.9) 49.3
======== ===== ====== =======
<CAPTION>
1998
- ---------------------------------------------------------------------------------------------
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Available-for-sale:
U. S. Treasury securities $ 20.7 0.4 -- 21.1
Government agency
obligations 1,151.5 122.5 (11.2) 1,262.8
Corporate securities 6,889.9 380.1 (164.1) 7,105.9
Mortgage-backed securities 1,812.4 34.0 (38.5) 1,807.9
Asset-backed securities 861.7 13.1 (4.2) 870.6
--------- ----- ------ --------
Total fixed maturities
available-for-sale $10,736.2 550.1 (218.0) 11,068.3
========= ===== ====== ========
Equity securities $ 39.1 9.5 -- 48.6
========= ===== ====== ========
</TABLE>
The Company manages its credit risk associated with fixed maturities by
diversifying its portfolio. At December 31, 1999, the Company held no
corporate debt securities or foreign government debt securities of a
single issuer, which had a carrying value in excess of ten percent of
stockholder equity.
15
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
The amortized cost and estimated fair value of fixed maturity
investments at December 31, 1999 are shown by contractual maturity for
all securities except, U.S. Government agencies mortgage-backed
securities which are distributed by maturity year based on the Company's
estimate of the rate of future prepayments of principal over the
remaining lives of the securities (in millions). These estimates are
developed using prepayment speeds provided in broker consensus data.
Such estimates are derived from prepayment speed experience at the
interest rate levels projected for the applicable underlying collateral
and can be expected to vary from actual experience. Expected maturities
may differ from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or prepayment
penalties.
ESTIMATED
AMORTIZED FAIR
COST VALUE
--------- ---------
Due in one year or less $ 147.8 149.0
Due after one year through five years 1,122.9 1,086.1
Due after five years through ten years 1,641.7 1,482.9
Due after ten years through twenty years 3,603.1 3,243.3
Mortgage-backed securities 970.3 864.8
-------- -------
Total $7,485.8 6,826.1
======== =======
The sources of net investment income follow (in millions):
1999 1998 1997
-------- ------- -----
Fixed maturities $ 749.6 744.3 561.7
Mortgage loans 175.4 188.8 194.5
Real estate 25.0 25.7 34.1
Equity securities 2.0 1.2 1.3
Policy loans 144.9 152.2 148.3
Short-term investments 46.5 22.4 16.6
Other 33.0 18.9 14.0
-------- ------- -----
Investment revenue 1,176.4 1,153.5 970.5
Investment expenses (19.2) (17.7) (25.0)
-------- ------- -----
Net investment income $1,157.2 1,135.8 945.5
======== ======= =====
16
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
Net realized gains (losses) from sales of investments consist of the
following (in millions):
1999 1998 1997
------- ----- -----
Fixed maturities:
Realized gains $ 70.4 19.0 24.0
Realized losses (330.8) (14.0) (16.8)
Equity securities:
Realized gains 48.2 2.0 1.8
Realized losses (0.4) (0.2) (1.5)
Other investments, net 12.0 6.9 21.0
------- ----- -----
Net realized investment gains $(200.6) 13.7 28.5
======= ===== =====
Included in net realized losses are permanent write-downs of
approximately $67.6 million and $5.5 million during 1999 and 1998,
respectively.
A summary of the components of the net unrealized appreciation
(depreciation) on invested assets carried at fair value is as follows
(in millions):
1999 1998
------- ------
Unrealized (depreciation) appreciation:
Fixed maturities available-for-sale $(659.7) 332.1
Equity securities 6.6 9.5
Derivatives (33.8) (5.3)
Effect of unrealized appreciation (depreciation) on:
Deferred policy acquisition costs 186.0 (155.7)
Present value of future profits 14.6 (0.5)
Deferred income taxes 169.7 (69.1)
Other 1.5 (2.9)
Minority interest, net of taxes 69.4 (19.6)
------- ------
Net unrealized (depreciation) appreciation $(245.7) 88.5
======= ======
The Company has securities on deposit with various state insurance
departments and regulatory authorities with an amortized cost of
approximately $881.8 million and $545.7 million at December 31, 1999 and
1998, respectively.
The Company's credit review procedures are designed to promote timely
identification of investments that require a higher-than-normal degree
of scrutiny. Each quarter a review is performed of impaired assets.
Factors considered in the evaluation include the collateral values,
credit quality of the issuer, amount of the exposure, our ability to
reduce exposure in situations of deteriorating credit worthiness, and
loss probabilities. Once a charge-off is taken, income is no longer
accrued, all cash is applied to principal. The Company's total impaired
assets amount to $31.8 million and $35.6 million at December 31, 1999
and 1998, respectively.
17
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
MORTGAGE LOANS
The Company originates mortgage loans on income-producing properties,
such as apartments, retail and office buildings, light warehouses, and
light industrial facilities. Loan to value ratios at the time of loan
approval are 75 percent or less. The Company minimizes risk through a
thorough credit approval process and through geographic and property
type diversification.
During 1999, the Company entered into an agreement whereby approximately
$625.6 million of mortgage loans were sold by the Company for
securitization and resale by a financial institution as mortgage pass-
through certificates. The sale of these mortgage loans resulted in a
net gain of approximately $0.6 million. These amounts are reflected
within net investment income in the consolidated statement of
operations.
The Company's mortgage loans were distributed as follows (in millions):
<TABLE>
<CAPTION>
1999 1998
-------------------- --------------------
PERCENT PERCENT
CARRYING OF CARRYING OF
VALUE TOTAL VALUE TOTAL
-------------------- --------------------
<S> <C> <C> <C> <C>
Arizona $ 125.6 7.4% $ 167.6 7.1%
California 298.0 17.4 395.3 16.6
Colorado 150.5 8.8 228.1 9.6
Florida 134.0 7.9 171.6 7.2
Georgia 137.6 8.1 176.1 7.4
Illinois 91.9 5.4 162.2 6.8
Maryland 78.2 4.6 102.9 4.3
Missouri 98.1 5.7 93.5 3.9
Texas 157.8 9.2 197.4 8.3
Washington 69.1 4.0 99.6 4.2
Other 367.2 21.5 581.7 24.6
-------------------- --------------------
Subtotal 1,708.0 100.0% 2,376.0 100.0%
===== =====
Valuation reserve (29.1) (38.5)
-------- --------
Total $1,678.9 $2,337.5
======== ========
<CAPTION>
1999 1998
-------------------- --------------------
PERCENT PERCENT
CARRYING OF CARRYING OF
VALUE TOTAL VALUE TOTAL
-------------------- --------------------
<S> <C> <C> <C> <C>
Property type:
Apartment $ 143.0 8.4% $ 77.1 3.2%
Retail 490.8 28.7 872.2 36.7
Office building 604.6 35.4 747.8 31.5
Industrial 391.6 22.9 422.6 17.8
Other commercial 78.0 4.6 256.3 10.8
-------------------- --------------------
Subtotal 1,708.0 100.0% 2,376.0 100.0%
===== =====
Valuation reserve (29.1) (38.5)
-------- --------
Total $1,678.9 $2,337.5
======== ========
</TABLE>
18
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
An impaired loan is measured at the present value of expected future
cash flows or, alternatively, the observable market price or the fair
value of the collateral.
Mortgage loans which have been non-income producing for the preceding
twelve months were $6.5 million and $20.1 million at December 31, 1999
and 1998, respectively. At December 31, 1999 and 1998, the recorded
investment in mortgage loans that were considered impaired was $48.8
million and $100.7 million, respectively, with related allowances for
credit losses of $4.0 million and $12.6 million, respectively. The
average recorded investment in impaired loans during 1999 and 1998 was
$74.8 million and $110.2 million, respectively.
For the years ended December 31, 1999, 1998, and 1997, the Company
recognized $3.6 million, $6.8 million, and $9.7 million, respectively,
of interest income on those impaired loans, which included $3.6 million,
$7.0 million, and $9.9 million, respectively, of interest income
recognized using the cash basis method of income recognition.
As of December 31, 1999, the Company has outstanding fixed rate
Commercial mortgage loan commitments totaling $68.9 million with a
market value of $67.0 million at rates ranging from 7.125% to 8.50%, and
total variable rate commitments totaling $143.3 million with a market
value of $140.9 million.
SECURITIES LENDING
The Company participates in a securities lending program. In the
Company's agreements, collateral is held on certain fixed maturity
securities loaned to other institutions through a lending agreement.
The minimum collateral on securities loaned is 102% of the market value
of the loaned securities, marked to market daily. The Company retains
full ownership of the loaned securities and is indemnified by the
lending agent in the event a borrower becomes insolvent or fails to
return the securities. The amount on loan at December 31, 1999 and 1998
was $60.3 million and $122.5 million, respectively, and was
appropriately collateralized.
DERIVATIVES
The Company has a variety of reasons to use derivative instruments, such
as to attempt to protect the Company against possible changes in the
market value of its portfolio as a result of interest rate changes and
to manage the portfolio's effective yield, maturity, and duration. The
Company does not invest in derivatives for speculative purposes. Upon
disposition, a realized gain or loss is recognized accordingly, except
when exercising an option contract or taking delivery of a security
underlying a futures contract. In these instances, the recognition of
gain or loss is postponed until the disposal of the security underlying
the option of futures contract.
Summarized below are the specific types of derivative instruments used
by the Company:
INTEREST RATE SWAPS: The Company manages interest rate risk on certain
contracts, primarily through the utilization of interest rate swaps.
Under interest rate swaps, the Company agrees with counterparties to
exchange, at specified intervals, the payments between floating and
fixed-rate interest amounts calculated by reference to notional amounts.
Net interest payments are recognized within net investment income in the
consolidated statements of operations.
At December 31, 1999, the Company had 19 outstanding interest rate swap
agreements which expire at various dates through 2024. Under 18 of the
agreements, the Company receives a fixed rate ranging from 6.065 percent
to 6.842 percent on a notional amount of $1.5 billion and pays a
floating rate based on London Interbank Offered Rate (LIBOR). Under the
remaining outstanding interest rate swap agreement, the Company receives
a floating rate based on LIBOR on a notional amount of $2 million and
pays a fixed rate of 6.495 percent. The estimated fair value of the
agreements at December 31, 1999 was a net loss of approximately $33.8
million, which is recognized in accumulated other comprehensive income.
19
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
At December 31, 1998, the Company had 35 outstanding interest rate swap
agreements which expire at various dates through 2025. Under 19
outstanding interest rate swap agreements, the Company receives a
floating rate based on LIBOR on a notional amount of $116.0 million and
pays a fixed rate ranging from 3.13 percent to 8.56 percent. Under 15
of the agreements, the Company receives a fixed rate ranging from 5.79
percent to 7.57 percent on a notional amount of $80.5 million and pays a
floating rate based on LIBOR. On the remaining swap agreement, the
Company receives a floating rate based on LIBOR on a notional amount of
$5 million and pays a floating rate based on LIBOR. The estimated fair
value of the agreements at December 31, 1998 was a net loss of
approximately $4.7 million, which is recognized in accumulated other
comprehensive income.
CURRENCY, SWAPS AND CROSS CURRENCY SWAPS: Under foreign currency swaps,
the Company agrees with other parties to exchange at specified
intervals, the difference between two currencies on an exchange rate
basis the interest amounts calculated by reference to an agreed notional
principal amount. Under cross currency swaps, the Company swaps the
difference between two currencies and between floating and fixed-rate
interest amounts calculated by reference to notional amounts. The
Company uses this technique for foreign denominated assets to match
dollar denominated liabilities of various fixed income products. Net
interest payments are recognized within net investment income in the
consolidated statements of operations.
At December 31, 1999, the Company held no currency or cross currency
swaps. At December 31, 1998 the Company had one outstanding currency
swap agreement and five outstanding cross currency swaps which expire at
various dates through 2016. The notional amount was $34.2 million. The
1998 estimated fair value of the agreements was a net loss of $5.5
million and is recognized in accumulated other comprehensive income.
TOTAL RETURN SWAP: The Company uses the total return swap to construct a
structured product that resembles an equity linked note. The total
return swap is used to obtain equity participation. The Company agrees
with other parties to pay at specified intervals, floating-rate interest
amounts calculated by reference to an agreed notional principal amount.
In return the Company receives equity participation, which is calculated
by reference to an agreed equity market index and a notional principal
amount. If the amount is positive at the termination date, the Company
receives such amount. If the amount is negative at the termination date,
the Company pays out such amount to the counterparty.
At December 31, 1999, the Company held no total return swap agreements.
At December 31, 1998, the Company had one outstanding total return swap,
which expires in 2028. The notional amount was $14.0 million and the
estimated fair value of the agreement was a net profit of $1.9 million,
which is recognized in accumulated other comprehensive income.
FUTURES: A futures contract is an agreement involving the delivery of a
particular asset on a specified future date at an agreed upon price.
The Company generally invests in futures on U.S. Treasury Bonds, U.S.
Treasury Notes, and the S&P 500 Index and typically closes the contract
prior to the delivery date. These contracts are generally used to manage
the portfolio's effective maturity and duration.
At December 31, 1999, the Company held no futures contracts. At
December 31, 1998, futures contracts outstanding were as follows (in
millions):
Net Sold Notional Fair Unrealized
Position Amount Value Gain
-------- -------- ----- -----------
(0.3) $33.1 $32.9 $0.2
The 1998 unrealized gain was recognized in accumulated other
comprehensive income.
20
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
The Company is exposed to credit related risk in the event of
nonperformance by counterparties to financial instruments but does not
expect any counterparties to fail to meet their obligations. Where
appropriate, master netting agreements are arranged and collateral is
obtained in the form of rights to securities to lower the Company's
exposure to credit risk. It is the Company's policy to deal only with
highly rated companies. At December 31, 1999 and 1998, there were not
any significant concentrations with counterparties.
(4) FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of a financial instrument is the amount at which the
instrument could be exchanged in a current transaction between willing
parties. The following table presents the carrying amounts and estimated
fair values of the Company's financial instruments at December 31, 1999
and 1998 (in millions). Refer to Note 3 for the estimated fair values
of the Company's derivative instruments.
<TABLE>
<CAPTION>
1999 1998
-------------------- --------------------
ESTIMATED ESTIMATED
CARRYING FAIR CARRYING FAIR
VALUE VALUE VALUE VALUE
-------------------- --------------------
<S> <C> <C> <C> <C>
Assets:
Fixed maturities $6,826.1 6,826.1 11,068.3 11,068.3
Mortgage loans 1,678.9 1,691.7 2,337.5 2,472.5
Policy loans 2,243.9 2,243.9 2,151.0 2,151.0
Short-term investments 292.4 292.4 195.3 195.3
Other invested assets 898.8 898.8 457.6 457.6
Separate account assets 6,915.6 6,915.6 5,214.8 5,214.8
Liabilities:
Policyholder account balances
relating to investment
Contracts $5,179.4 5,279.8 5,044.8 4,929.7
Pension funds and other
interest sensitive liabilities 556.8 551.2 7,581.3 7,592.0
Long-term debt and
notes payable 216.6 209.8 221.9 216.6
Separate account liabilities 6,892.0 6,892.0 5,194.9 5,194.9
======== ======= ======== ========
</TABLE>
(5) REINSURANCE
The Company is a reinsurer to the life and health industry. The effect
of reinsurance on premiums and other considerations is as follows
(in millions):
<TABLE>
<CAPTION>
1999 1998 1997
-------- ------- -------
<S> <C> <C> <C>
Direct $1,139.5 1,210.8 1,159.1
Assumed 1,667.7 1,422.3 996.9
Ceded (416.4) (431.5) (348.9)
-------- ------- -------
Net insurance premiums and other
considerations $2,390.8 2,201.6 1,807.1
======== ======= =======
</TABLE>
21
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(6) FEDERAL INCOME TAXES
Income tax (benefit) expense attributable to income from operations
consists of the following (in millions):
<TABLE>
<CAPTION>
1999 1998 1997
------ ---- ----
<S> <C> <C> <C>
Current income tax (benefit) expense $(23.6) 35.2 65.8
Deferred income tax (benefit) expense (40.7) 18.4 (0.1)
------ ---- ----
Provision for income taxes $(64.3) 53.6 65.7
====== ==== ====
</TABLE>
Income tax (benefit) expense attributable to income from operations
differed from the amounts computed by applying the U.S. federal
income tax rate of 35 percent to pre-tax income as a result of
the following (in millions):
<TABLE>
<CAPTION>
1999 1998 1997
------ ----- ----
<C> <C> <C> <C>
Computed "expected" tax (benefit) expense $(67.4) 70.0 64.8
Increase (decrease) in income tax resulting
from:
Surplus (benefit) tax on mutual life
insurance companies - (7.5) 5.3
Foreign tax rate in excess of U.S. tax
rate 1.0 0.8 0.6
Tax preferred investment income (11.4) (10.9) (6.6)
State tax net of federal benefit 1.7 1.6 0.8
Corporate owned life insurance (3.3) (3.6) -
Foreign tax credit - (1.3) (0.6)
Goodwill amortization 1.9 1.5 1.0
Difference in book vs. tax basis in
domestic subsidiaries 1.6 2.8 2.2
Valuation allowance for loss
carryforwards 5.7 - -
Capitalized acquisition costs 2.4 - -
Other, net 3.5 0.2 (1.8)
------ ---- ----
Provision for income taxes $(64.3) 53.6 65.7
====== ==== ====
</TABLE>
Total income taxes were allocated as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------- ----- -----
<S> <C> <C> <C>
Provision for income taxes $ (64.3) 53.6 65.7
Income tax from stockholder equity:
Unrealized investment (loss) gain
recognized for financial reporting
purposes (237.0) (22.6) 55.9
Foreign currency translation 7.8 (9.4) (12.1)
Other (2.4) (1.4) (0.5)
------- ----- -----
Provision for income taxes $(295.9) 20.2 109.0
======= ===== =====
</TABLE>
22
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
The tax effects of temporary differences that give rise to significant
portions of deferred tax assets and liabilities at December 31, 1999
and 1998 are presented below (in millions):
<TABLE>
<CAPTION>
1999 1998
------ -----
<S> <C> <C>
Deferred tax assets:
Reserve for future policy benefits $158.9 90.9
Deferred acquisition costs capitalized for tax 147.4 128.8
Employee benefits 41.5 28.2
Investments 46.2 -
Net operating and capital loss 57.2 46.8
Unrealized loss on investments 163.9 -
Other, net 95.5 98.5
------ -----
Gross deferred tax assets 710.6 393.2
Less valuation allowance 7.2 1.5
------ -----
Total deferred tax assets after valuation allowance $703.4 391.7
====== =====
<CAPTION>
1999 1998
------- -----
<S> <C> <C>
Deferred tax liabilities:
Unrealized gain on investments $ - 79.1
Deferred acquisition costs capitalized for financial
reporting 385.0 274.5
Investments - 3.7
Other, net 120.8 109.8
------- -----
Total deferred tax liabilities 505.8 467.1
------- -----
Total deferred tax (asset) liability $(197.6) 75.4
======= =====
</TABLE>
The Company has not recognized a deferred tax liability for the
undistributed earnings of its wholly owned domestic and foreign
subsidiaries because the Company currently does not expect those
unremitted earnings to become taxable to the Company in the foreseeable
future. In addition, the Company has not recognized a deferred tax
liability of approximately $106 million for the excess of financial
statement carrying amount over the tax basis of its less-than-80-percent
owned domestic subsidiaries. This is because the unremitted earnings of
foreign subsidiaries will not be repatriated in the foreseeable future,
or because the excess of the financial statement carrying amount over
the tax basis of its less-that-80 percent owned domestic subsidiaries
will not become taxable as the tax law provides a means by which the
reported amount of that investment can be recovered tax-free and the
Company expects that it will ultimately use that means.
The Company believes that it is more likely than not that the deferred
tax assets established will be realized except for the amount of the
valuation allowance. As of December 31, 1999 and 1998, the Company has
provided for a 100 percent valuation allowance against the deferred tax
asset related to the net operating losses of the Company's foreign
subsidiaries including RGA's Australian, Argentine, South African and UK
subsidiaries and NaviSys' Mexican subsidiary. At December 31, 1999, the
Company's subsidiaries had capital loss carryforwards of $89.4 million,
and net operating loss carryforwards of $146.7 million. The capital and
net operating losses are expected to be utilized during the period
allowed for carryforwards.
23
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
The Company has been audited by the Internal Revenue Service for the
years through and including 1994. The Company is currently being
audited for the years 1995 and 1996. The Company believes that any
adjustments that might be required for open years will not have a
material effect on the Company's consolidated financial statements.
During 1999, 1998, and 1997 the Company paid income taxes totaling
approximately $77.0 million, $59.6 million, and $70.8 million,
respectively.
(7) DEFERRED POLICY ACQUISITION COSTS
A summary of the policy acquisition costs deferred and amortized is as
follows (in millions):
<TABLE>
<CAPTION>
1999 1998 1997
-------- ------ ------
<S> <C> <C> <C>
Balance at beginning of year $ 773.8 695.3 652.3
Transfer of present value of future profits -- -- 19.3
Prior year adjustment due to change in
reserving methods -- (0.2) --
Policy acquisition costs deferred 324.6 332.9 267.0
Policy acquisition cost amortized (214.4) (280.0) (211.9)
Interest credited 60.4 39.3 40.8
Deferred policy acquisition costs relating to
change in unrealized (gain) loss on
investments available-for-sale 341.7 (13.5) (72.2)
-------- ------ ------
Balance at end of year $1,286.1 773.8 695.3
======== ====== ======
</TABLE>
(8) ASSOCIATE BENEFIT PLANS AND POSTRETIREMENT BENEFITS
The Company has a defined benefit plan covering substantially all
associates. The benefits are based on years of service and each
associate's compensation level. The Company's funding policy is to
contribute annually the maximum amount deductible for federal income tax
purposes. Contributions provide for benefits attributed to service to
date and for those expected to be earned in the future.
Associates of the Company also are offered several non-qualified,
defined benefit, and defined contribution plans for directors and
management associates. The plans are unfunded and are deductible for
federal income tax purposes when the benefits are paid. Effective April
30, 1999, the liabilities that relate to these plans are managed at
GenAmerica Management Corporation, a subsidiary of GenAmerica. The
Company recognized expense of $12.9 million, $8.2 million, and $7.7
million for the years ended December 31, 1999, 1998, and 1997,
respectively, related to these plans.
In addition to pension benefits, the Company provides certain health
care and life insurance benefits for retired employees. Substantially
all employees may become eligible for these benefits if they reach
retirement age while working for the Company. Alternatively, retirees
may elect certain prepaid health care benefit plans.
The Company uses the accrual method to account for the costs of its
retiree plans and amortizes its transition obligation for retirees and
fully eligible or vested employees over 20 years. The unamortized
transition obligation was $13.4 million and $14.4 million at December
31, 1999 and 1998, respectively.
24
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
The Board of Directors has adopted an associate incentive plan
applicable to full-time salaried associates with at least one year of
service. Contributions to the plan are determined annually by the Board
of Directors and are based upon salaries of eligible associates. Full
vesting occurs after five years of continuous service. The Company's
contribution to the plan was $4.3 million, $10.4 million, and $10.4
million for 1999, 1998, and 1997 respectively.
At December 31, 1999, plan assets were invested 79.2% in the S&P Stock
Fund, 6.9% in the Small-Cap Stock Fund, 9.1% in the Separately Managed
Account Fund, and 4.8% in the Long-Term Bond Fund. At December 31, 1998
plan assets were invested 70.1% in the S&P 500 Stock Fund, 7.4% in the
Small-Cap Stock Fund, 17.3% in the Separately Managed Account Fund, and
5.2% in the Long-Term Bond Fund. These assets are invested in General
American separate accounts and held in a trust by an unrelated third
party administrator.
The following tables summarize the Company's associate benefit plans and
postretirement benefits (in millions):
<TABLE>
<CAPTION>
Pension Benefits Other Benefits
------------------ -----------------
1999 1998 1999 1998
------ ----- ----- ----
<S> <C> <C> <C> <C>
Change in benefit obligation:
Benefit obligation at beginning of year $149.1 129.8 $45.7 37.7
Service cost 6.5 5.8 1.7 1.7
Interest cost 10.3 9.2 2.8 2.9
Participant contributions -- -- 0.2 0.2
Plan amendments 0.3 (0.4) -- (1.3)
Curtailments 2.4 -- -- --
Special termination benefits 1.2 -- -- --
Benefits paid (8.0) (6.6) (1.9) (1.4)
Actuarial (gain) loss (1.9) 11.3 (7.8) 5.9
------ ----- ----- ----
Benefit obligation at end of year 159.9 149.1 40.7 45.7
------ ----- ----- ----
Change in plan assets:
Fair value of plan assets at
beginning of year 174.8 150.5 -- --
Actual return on plan assets 10.5 29.2 -- --
Employer contributions 2.1 1.7 1.7 1.2
Associates contributions -- -- 0.2 0.2
Benefits paid (8.0) (6.6) (1.9) (1.4)
------ ----- ----- ----
Fair value of plan assets at end of year $179.4 174.8 $-- --
====== ===== ===== ====
</TABLE>
25
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
<TABLE>
<CAPTION>
Pension Benefits Other Benefits
1999 1998 1997 1999 1998 1997
------ ----- ----- ------ ----- -----
<S> <C> <C> <C> <C> <C> <C>
Reconciliation of funded status:
Funded status $ 19.4 25.7 20.7 $(40.7) (45.7) (37.7)
Unrecognized actuarial gain (12.3) (14.5) (8.2) (9.6) (1.9) (7.8)
Unrecognized transition
obligation 0.2 0.3 1.1 13.4 14.4 16.8
Unrecognized prior service
cost (0.3) (0.8) (2.2) -- -- --
------ ----- ----- ------ ----- -----
Net amount recognized at end
of year 7.0 10.7 11.4 (36.9) (33.2) (28.7)
------ ----- ----- ------ ----- -----
Amounts recognized in the
statement of financial
position consist of:
Prepaid benefit cost 40.6 37.9 35.9 -- -- --
Accrued benefit liability (38.2) (32.2) (28.2) (36.9) (33.2) (28.7)
Intangible asset 0.1 0.9 0.9 -- -- --
Accumulated other
comprehensive loss 4.5 4.1 2.8 -- -- --
------ ----- ----- ------ ----- -----
Net amount recognized at end
of year $ 7.0 10.7 11.4 $(36.9) (33.2) (28.7)
====== ===== ===== ====== ===== =====
Other comprehensive loss
(income) attributable to
change in additional
minimum liability
recognition $ 0.3 1.3 (0.5) $ -- -- --
====== ===== ===== ====== ===== =====
</TABLE>
26
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
<TABLE>
<CAPTION>
Pension Benefits Other Benefits
1999 1998 1997 1999 1998 1997
------ ----- ----- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Additional year-end
information for plans with
benefit obligations in
excess of plan assets:
Benefit obligation 47.6 36.6 32.2 40.7 45.7 37.7
Additional year-end
information for pension
plans with accumulated
benefit obligations in
excess of plan assets:
Projected benefit
obligation 40.5 36.6 32.2 -- -- --
Accumulated benefit
obligation 37.8 32.1 28.0 -- -- --
Fair value of plan assets 0.1 0.1 -- -- -- --
====== ===== ===== ==== ==== ====
Components of net periodic
benefit cost:
Service cost 6.5 5.8 5.9 1.7 1.7 1.7
Interest cost 10.3 9.2 8.6 2.8 2.9 2.5
Expected return on plan
assets (15.3) (13.2) (11.1) -- -- --
Amortization of prior
service cost (0.1) (0.1) 0.1 -- -- --
Amortization of
transitional
obligation 0.1 0.1 0.3 1.0 1.0 1.1
Recognized actuarial
loss (gain) 0.6 0.4 0.4 (0.1) -- (0.2)
------ ----- ----- ---- ---- ----
Net periodic benefit cost $ 2.1 2.2 4.2 5.4 5.6 5.1
====== ===== ===== ==== ==== ====
Additional loss recognized due to:
Curtailment $ 2.3 0.1 -- -- -- --
Special Termination Benefit 1.4 -- -- -- -- --
====== ===== ===== ==== ==== ====
Weighted-average assumptions as
of December 31:
Discount rate 7.50% 6.75% 7.25% 7.50% 6.75% 7.25%
Expected long-term rate of
return on plan assets 9.00% 9.00% 9.00% -- -- --
Rate of compensation
increase (qualified plan) 4.95% 4.20% 4.20% -- -- --
====== ===== ===== ==== ==== ====
</TABLE>
27
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
ASSUMED HEALTH CARE COST TREND: For measurement purposes, a 7.0% annual
rate of increase in the per capita cost of covered health care benefits
was assumed for 1999. The rate assumed to decrease gradually to 5% for
2003 and remain at that level thereafter.
Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plan. A one-percentage point change
in assumed health care cost trend rates would have the following effects
(in thousands):
One Percentage One Percentage
Point Increase Point Decrease
-------------- --------------
Effect on total service and interest cost
components for 1999 $0.9 (0.7)
Effect on end of year 1999
postretirement benefit obligation $5.8 (4.7)
(9) DEBT
The Company's long-term debt and notes payable consists of the
following (in millions):
<TABLE>
<CAPTION>
Face Value at December 31,
Description Rate Maturity 1999 1998
- ----------- ---- -------- ---- ----
<S> <C> <C> <C> <C>
Long-term debt:
General American surplus note 7.625% January 2024 $107.0 107.0
RGA senior note 7.250% April 2006 100.0 100.0
Notes payable:
RGA Australia Hldgs. 5.180% April 2000 9.5 8.9
------ -----
Total long-term debt and notes payable $216.5 215.9
====== =====
</TABLE>
The difference between the face value of debt and the carrying value per
the consolidated balance sheets is unamortized discount.
General American's surplus note pays interest on January 15 and July 15
of each year. The note is not subject to redemption prior to maturity.
Payment of principal and interest on the note may be made only with the
approval of the Missouri Director of Insurance.
The RGA senior note pays interest semiannually on April 1 and October 1.
The ability of RGA to make debt principal and interest payments as well
as make dividend payments to shareholders is ultimately dependent on the
earnings and surplus of its subsidiaries and the investment earnings on
the undeployed debt proceeds. The transfer of funds from the insurance
subsidiaries to RGA is subject to applicable insurance laws and
regulations. Principal repayments are due in April 2000 and are
expected to be renewed under the terms of the line of credit. This
agreement contained various restrictive covenants which primarily
pertain to limitations on the quality and types of investments, minimum
requirements of net worth, and minimum rating requirements.
Interest paid on debt during 1999, 1998, and 1997 amounted to $17.8
million, $17.0 million, and $20.0 million, respectively.
As of December 31, 1999, the Company was in compliance with all
covenants under its debt agreements.
28
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(10) COMPREHENSIVE INCOME
In June 1997, the Financial Accounting Standards Board issued SFAS No.
130, Reporting Comprehensive Income, effective for years beginning after
December 15, 1997. SFAS No. 130 establishes standards for reporting and
display of comprehensive income but does not affect results of
operations. Effective January 1, 1998, the Company adopted SFAS No. 130.
The components of comprehensive income, other than net income, are as
follows (in millions):
<TABLE>
<CAPTION>
1999
---------------------------------------------
TAX NET-
BEFORE-TAX (EXPENSE) OF-TAX
AMOUNT BENEFIT AMOUNT
---------------------------------------------
<S> <C> <C> <C>
Foreign currency translation adjustments $ 19.5 (6.8) 12.7
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during
period (753.1) 266.9 (486.2)
Less: Reclassification adjustment for gains
(losses) realized in net income (233.5) 81.5 (152.0)
---------------------------------------------
Net unrealized gains (losses) on securities (519.6) 185.4 (334.2)
Minimum benefit liability (1.0) 1.3 0.3
---------------------------------------------
Total other comprehensive (loss) income $(501.1) 179.9 (321.2)
=============================================
<CAPTION>
1998
---------------------------------------------
TAX NET-
BEFORE-TAX (EXPENSE) OF-TAX
AMOUNT BENEFIT AMOUNT
---------------------------------------------
<S> <C> <C> <C>
Foreign currency translation adjustments $(20.6) 7.2 (13.4)
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during
period (56.6) 19.3 (37.3)
Less: Reclassification adjustment for gains
(losses) realized in net income 4.7 (1.7) 3.0
--------------------------------------------
Net unrealized gains (losses) on securities (61.3) 21.0 (40.3)
Minimum benefit liability (0.3) -- (0.3)
--------------------------------------------
Total other comprehensive (loss) income $(82.2) 28.2 (54.0)
============================================
</TABLE>
29
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
<TABLE>
<CAPTION>
1997
---------------------------------------------
TAX NET-
BEFORE-TAX (EXPENSE) OF-TAX
AMOUNT BENEFIT AMOUNT
---------------------------------------------
<S> <C> <C> <C>
Foreign currency translation adjustments $(14.3) 10.6 (3.7)
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during
period 132.3 (49.1) 83.2
Less: Reclassification adjustment for gains
(losses) realized in net income 7.4 (2.6) 4.8
---------------------------------------------
Net unrealized gains (losses) on securities 124.9 (46.5) 78.4
Minimum benefit liability 0.9 -- 0.9
---------------------------------------------
Total other comprehensive (loss) income $111.5 (35.9) 75.6
=============================================
</TABLE>
The following schedule reflects the change in net accumulated other
comprehensive (loss) income for the periods ending December 31, 1999
and 1998 (in millions):
<TABLE>
<CAPTION>
CURRENT
BALANCE AS PERIOD BALANCE AS
OF 12/31/98 CHANGE OF 12/31/99
----------- ------- -----------
<S> <C> <C> <C>
Foreign currency adjustments $(32.9) 12.7 (20.2)
Unrealized gains (losses) on securities 88.5 (334.2) (245.7)
Minimum benefit liability (2.7) 0.3 (2.4)
----------- ------- -----------
Total accumulated other comprehensive
(loss) income $ 52.9 (321.2) (268.3)
----------- ------- -----------
<CAPTION>
CURRENT
BALANCE AS PERIOD BALANCE AS
OF 12/31/97 CHANGE OF 12/31/98
----------- ------- -----------
<S> <C> <C> <C>
Foreign currency adjustments $(19.5) (13.4) (32.9)
Unrealized gains (losses) on securities 128.8 (40.3) 88.5
Minimum benefit liability (2.4) (0.3) (2.7)
----------- ------- -----------
Total accumulated other comprehensive
(loss) income $106.9 (54.0) 52.9
=========== ======= ===========
</TABLE>
30
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(11) REGULATORY MATTERS
The Company and its insurance subsidiaries are subject to financial
statement filing requirements in their respective state of domicile, as
well as the states in which they transact business. Such financial
statements, generally referred to as statutory financial statements, are
prepared on a basis of accounting which varies in some respects from
GAAP. Statutory accounting practices include: (1) charging of policy
acquisition costs to income as incurred; (2) establishment of a
liability for future policy benefits computed using required valuation
standards; (3) nonprovision of deferred federal income taxes resulting
from temporary differences between financial reporting and tax bases of
assets and liabilities; (4) recognition of statutory liabilities for
asset impairments and yield stabilization on fixed maturity dispositions
prior to maturity with asset valuation reserves based on statutorily
determined formulas; and (5) valuation of investments in bonds at
amortized cost.
Combined net income and policyholders' surplus of the Company and its
consolidated insurance subsidiaries, for the years ended and at December
31, 1999, 1998, and 1997, as determined in accordance with statutory
accounting practices, are as follows (in millions):
1999 1998 1997
------- ------- -----
Net (loss) income $(190.8) 60.8 39.7
Policyholders' surplus 741.3 1,147.4 844.1
======= ======= =====
For the year ended December 31, 1999, General American has changed its
method for recording equity in earnings of subsidiaries on a statutory
basis to reflect such earnings as a direct charge or credit to surplus,
and not a component of investment income.
Under Risk-Based Capital (RBC) requirements, General American and its
insurance subsidiaries are required to measure their solvency against
certain parameters. As of December 31, 1999, the Company's insurance
subsidiaries exceeded the established RBC minimums. In addition, the
Company's insurance subsidiaries exceeded the minimum statutory capital
and surplus requirements of their respective states of domicile.
The Company's insurance subsidiaries are subject to limitations on the
payment of dividends to the Company. Generally, dividends during any
year may not be paid without prior regulatory approval, in excess of the
lessor of (and with respect to life and health subsidiaries in Missouri,
in excess of the greater of): (a) ten percent of the insurance
subsidiaries' statutory surplus as of the preceding December 31 or (b)
the insurance subsidiaries' statutory gain from operations for the
preceding year.
31
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(12) PARTICIPATING POLICIES AND DIVIDENDS TO POLICYHOLDERS
Over 18.9 percent and 22.8 percent of the Company's business in force
relates to participating policies as of December 31, 1999 and 1998,
respectively. These participating policies allow the policyholders to
receive dividends based on actual interest, mortality, and expense
experience for the related policies. These dividends are distributed to
the policyholders through an annual dividend, using current dividend
scales which are approved by the Board of Directors.
(13) CONTINGENT LIABILITIES
The Company was named as a defendant in a lawsuit that was filed in 1996
in Arizona State Court. The lawsuit claimed benefits under a disability
policy and damages for bad faith termination of such benefits. In
November 1998, the jury entered a verdict against the Company, awarding
the plaintiff approximately $59 million in damages, including $58
million in punitive damages. In January 1999, the Company filed a motion
for judgment notwithstanding the verdict, a motion for a new trial, and
a request for reduction of the punitive damages awarded. The Trial
Court reduced the punitive damage award to $18 million. The Company has
appealed the verdict and the award of the Court.
The Company was named as a defendant in a lawsuit filed in a federal
district court in Phoenix, Arizona along with Paul Revere Life Insurance
Company. The lawsuit claimed that Paul Revere denied benefits which was
a breach of the implied duty of good faith and that both companies were
liable due to being in a joint venture relationship. The jury found for
the plaintiff and assessed punitive damages against the company in the
sum of $10.2 million and against Paul Revere in the sum of $6.8 million.
Both companies have filed post-trial motions aimed at setting aside the
jury verdict and/or reducing the jury awards. The Company intends to
vigorously appeal the verdict if it is allowed to stand.
The Company was named as defendant in the following purported class
action lawsuits: Chain v. General American Life Insurance Company (filed
in the U.S. District Court for the Northern District of Mississippi in
1996); Newburg Trust v. General American Life Insurance Company (filed
in the U.S. District Court for the District of Massachusetts in 1996);
and Ludwig, Sippil, DAllesandro and Cunningham v. General American Life
Insurance Company (filed in the U.S. District Court for the Southern
District of Illinois in 1997). These lawsuits allege that the Company
engaged in deceptive sales practices in connection with the sale of
certain life insurance policies. None of these lawsuits has been
certified as a class action. Although the claims asserted in each
lawsuit are not identical, the plaintiffs seek unspecified actual and
punitive damages under similar claims, including breach of contract,
fraud, intentional or negligent misrepresentation, breach of fiduciary
duty and unjust enrichment. The Company filed a motion to dismiss all
of the claims in each of the lawsuits. The Court in each of these
lawsuits has dismissed certain of the plaintiffs' claims while allowing
others to proceed. These three cases have been consolidated with one
individual case in the U.S. District Court for the Eastern District of
Missouri. The Company has negotiated a settlement agreement with counsel
for plaintiffs which resolves all matters concerning the relief for the
class. There is, however, no agreement on the attorneys' fees or
expenses of class counsel. This settlement is in the process of being
finalized. It will then be submitted to the Court for review and
approval along with the issue of attorneys' fees and expenses. If the
settlement is not approved the Company intends to continue to oppose the
lawsuits vigorously.
In addition to the matters discussed above, the Company is involved in
pending and threatened litigation in the normal course of its business.
While the outcome of these matters cannot be predicted with certainty,
at the present time and based on information currently available,
management does not believe that the Company's liability arising from
pending or threatened litigation will have a material adverse affect on
the Company's financial condition or results of operations.
32
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
(14) RELATED PARTY TRANSACTIONS
In 1999, GenAmerica made capital contributions to the Company of $38.0
million, $10.1 million of NaviSys Incorporated's (NaviSys) equity, and
$20.0 million of NaviSys' bonds. The $38.0 million contribution
consisted of a promissory note from ARM, and was expensed by the Company
after it became uncollectible.
The following related party transactions occurred in the connection with
MetLife's acquisition of GenAmerica.
The Company paid and expensed approximately $20 million to MetLife
as consideration for MetLife's willingness to accept the funding
agreement business of General American as described in Note 1.
The Company paid $40 million to MetLife during 1999 which
ultimately was returned to GAMHC at the closing on January 6,
2000. This transaction has been recorded as a dividend by the
Company to GAMHC in the accompanying financial statements.
Subsequent to December 31, 1999 an additional $40 million was paid
to MetLife on behalf of GAMHC.
During 1999, GenAmerica paid and expensed $12 million of
investment advisory fees for which GAMHC and GenAmerica were
jointly and severably liable.
RGA also has reinsurance transactions between MetLife and certain of its
subsidiaries. Under these agreements, RGA reflected earned premiums of
approximately $108 million and $113 million in 1999 and 1998,
respectively. The earned premiums reflect the net of business assumed
from and ceded to MetLife and its subsidiaries. Underwriting gain
(loss) on this business was approximately $12 million and $13 million in
1999 and 1998, respectively.
(15) SUBSEQUENT EVENTS
On January 1, 2000, the Company exited the Group Health business through
the Asset Purchase Agreement and related reinsurance arrangements with
Great-West Life & Annuity Insurance Company (Great-West). This
agreement also includes any life business that is directly associated to
the health business.
The Company is required to reimburse Great-West for up to $10 million in
net operating losses incurred during 2000. These amounts have been
fully accrued in the 1999 consolidated financial statements of the
Company. The Company must also compensate Great-West for certain
receivables related to this business should they be deemed uncollectible.
On January 18, 2000, MetLife proposed to acquire all of Conning's
outstanding shares of common stock not already controlled by MetLife for
$10.50 per share in cash. MetLife acquired a beneficial interest of
approximately 61% in Conning as a result of its January 6, 2000
acquisition of GenAmerica. Conning has received MetLife's proposal and
the Conning Board of Directors is evaluating the proposed transaction.
33
<PAGE>
<PAGE>
General American Life Insurance Company and Subsidiaries
On January 24, 2000, Conning announced that it had learned of a
complaint purporting to be a shareholder class action suit that has been
filed in the Supreme Court of the State of New York, naming Conning and
MetLife as co-defendants. The complaint follows the January 18, 2000
announcement of MetLife's proposal to acquire all of the outstanding
shares of common stock not already controlled by MetLife for $10.50 per
share in cash. The complaint alleges that MetLife's proposal to acquire
the remaining equity interest in Conning fails to offer a fair price to
Conning's shareholders and lacks adequate procedural protections.
Additionally, the complaint alleges that as a result of MetLife's
proposal, the defendants have engaged in acts of self-dealing and
breeches of fiduciary duty in connection with the proposed transaction.
Conning was subsequently served with the complaint and believes the
plaintiff's claims are without merit.
34
<PAGE>
<PAGE>
PART II
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities and
Exchange Act of 1934, the undersigned registrant hereby undertakes to file
with the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore, or hereafter duly adopted pursuant
to authority conferred in that section.
RULE 484 UNDERTAKING
Section 351.355 of the Missouri General and Business Corporation Law, in
brief, allows a corporation to indemnify any person who is a party or is
threatened to be made a party to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative by reason of the fact that he is or was a director, officer,
employee, or agent of the corporation, against expenses, including
attorneys' fees, judgments, fines, and amounts paid in settlement actually
and reasonably incurred by him in connection with such action if he acted
in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation. When any person was or
is a party or is threatened to be made a party in an action or suit by or
in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee, or
agent of the corporation, indemnification may be paid unless such person
shall have been adjudged to be liable for negligence or misconduct in the
performance of his duty to the corporation. In the event of such a
determination indemnification is allowed if a court determines that the
person is fairly and reasonably entitled to indemnity. A corporation has
the power to give any further indemnity to any person who is or was a
director, officer, employee, or agent, provided for in the articles of
incorporation or as authorized by any by-law which has been adopted by vote
of the shareholders, provided that no such indemnity shall indemnify any
person's conduct which was finally adjudged to have been knowingly
fraudulent, deliberately dishonest, or willful misconduct.
In accordance with Missouri law, General American's Board of Directors, at
its meeting on November 19, 1987, and the policyholders of General American
at the annual meeting held on January 26, 1988, adopted the following
resolutions:
"BE IT RESOLVED THAT
1. The company shall indemnify any person who is, or was a
director, officer, or employee of the company, or is or was serving
at the request of the company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or
other enterprise, against any and all expenses (including attorneys'
fees), judgments, fines, and amounts paid in settlement, actually and
reasonably incurred by him or her in connection with any civil,
criminal, administrative, or investigative action, proceeding, or
claim (including an action by or in the right of the company), by
reason of the fact that he or she
<PAGE>
<PAGE>
was serving in such capacity if he or she acted in good faith and in
a manner he or she reasonably believed to be in or not opposed to the
best interests of the company; provided that such person's conduct is
not finally adjudged to have been knowingly fraudulent, deliberately
dishonest, or willful misconduct.
2. The indemnification provided herein shall not be deemed
exclusive of any other rights to which a director, officer, or
employee may be entitled under any agreement, vote of policyholders
or disinterested directors, or otherwise, both as to action in his or
her official capacity and as to action in another capacity which
holding such office, and shall continue as to a person who has ceased
to be a director, officer, or employee and shall inure to the benefit
of the heirs, executors and administrators of such a person."
Insofar as indemnification for liability 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.
REPRESENTATIONS PURSUANT TO SECTION 26(E)
General American Life Insurance Company hereby represents that the fees and
charges deducted under the Policies described in the prospectus are, in the
aggregate, reasonable in relation to the services rendered, the expenses
expected, and the risks assumed by General American Life Insurance Company.
<PAGE>
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This Registration Statement comprises the following papers and documents:
* The facing sheet.
* Destiny Variable Universal Life Insurance prospectus, consisting of
39 pages.
* The undertaking to file reports required by Section 15 (d) of the
1934 Act.
* The undertaking pursuant to Rule 484 of the 1933 Act.
* Representations pursuant to Section 26(e) of the 1940 Act.
* The signatures.
* Memorandum describing issuance, transfer, and redemption procedures
pursuant to Rule 6e-3(T). Filed Herewith.
* Opinion and Consent of Kathryn T. Dowdell, FSA, MAAA.<F4>
* The consent of KPMG LLP, Independent Certified Public Accountants.
Filed Herewith.
1. The following exhibits (which correspond in number to the numbers
under paragraph A of the instructions for exhibits to Form N-8B-2):
(1) Resolution of the Board of Directors of General American Life
Insurance Company authorizing establishment of the Separate
Account Eleven.<F1>
(2) Not applicable.
(3) (a) Principal Underwriting Agreement.<F1>
(b) Proposed form of Selling Agreement.<F1>
(c) Commission Schedule.<F1>
(4) Not applicable.
(5) The two Destiny Universal Life Insurance policies.<F4>
(6) (a) Amended Charter and Articles of Incorporation of General
American.<F2>
(b) Amended and Restated By-Laws of General American.<F2>
(7) Not applicable.
(8) (a) Participation Agreement with General American Capital
Company.<F3>
(b) Participation Agreement with Variable Insurance Products
Fund.<F3>
(c) Participation Agreement with Variable Insurance Products
II.<F3>
(d) Participation Agreement with J.P. Morgan Series Trust
II.<F3>
(e) Participation Agreement with Van Eck Worldwide Insurance
Trust.<F3>
(f) Participation Agreement with American Century Variable
Portfolios.<F3>
(9) Not applicable.
(10) Form of application for Destiny Universal Life Insurance.
Filed Herewith.
2. Opinion of Christopher A. Martin, Counsel of GenAmerica Management
Company, as to the legality of the securities being issued.<F4>
3. No financial statements will be omitted from the prospectuses
pursuant to prospectus instructions 1(b) or (c).
4. Not applicable
5. Financial Data Schedules.
[FN]
- ----------------
<F1.> Incorporated by reference to the initial Registration Statement, File
No. 33-48550 (VGSP), June 16, 1992.
<F2.> Incorporated by reference to the initial Registration Statement, File
No. 333-53477 (VUL 98), May 22, 1998.
<F3.> Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registration Statement, File No. 333-53477 (VUL 98), July 31, 1998.
<F4.> Incorporated by reference to the initial Registration Statement, File
No. 333-83625 (Destiny), July 23, 1999.
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, General
American Life Insurance Company and General American Separate Account
Eleven certify that, when amended as indicated, this Registration Statement
will meet all of the requirements for effectiveness pursuant to Rule 481
under the Securities Act of 1933, and they have duly caused this
Registration Statement to be signed on their behalf by the undersigned
thereunto duly authorized, and the seal of General American Life Insurance
Company to be hereunto affixed and attested, all in the City of St. Louis,
State of Missouri, on the 31st day of March 2000.
GENERAL AMERICAN SEPARATE ACCOUNT
ELEVEN (Registrant)
(Seal) BY: GENERAL AMERICAN LIFE
INSURANCE COMPANY (for Registrant
and as Depositor)
Attest: /s/ Robert J. Banstetter By: /s/ Kevin C. Eichner
--------------------------- ------------------------------
Robert J. Banstetter, Sr. Kevin C. Eichner,
Secretary President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Richard A. Liddy Chairman, Chief 3/31/00
- ---------------------------- Executive Officer
Richard A. Liddy (Principal Executive Officer)
/s/ Kevin C. Eichner President 03/31/00
- ----------------------------
Kevin C. Eichner
/s/ Barry C. Cooper Vice President 3/31/00
- ---------------------------- Controller
Barry C. Cooper (Principal Accounting
Officer)
- ----------------------------
August A. Busch, III<F*> Director
<PAGE>
<PAGE>
Director
- ----------------------------
William E. Cornelius<F*>
Director
- ----------------------------
John C. Danforth<F*>
Director
- ----------------------------
Bernard A. Edison<F*>
/s/ Richard A. Liddy Director 3/31/00
- ----------------------------
Richard A. Liddy
Director
- ----------------------------
William E. Maritz<F*>
Director
- ----------------------------
Craig D. Schnuck<F*>
Director
- ----------------------------
William P. Stiritz<F*>
Director
- ----------------------------
Andrew C. Taylor<F*>
Director
- ----------------------------
Robert L. Virgil, Jr.<F*>
Director
- ----------------------------
Virginia V. Weldon<F*>
Director
- ----------------------------
Ted C. Wetterau<F*>
<PAGE>
<PAGE>
By /s/ Matthew P. McCauley
-------------------------------
Matthew P. McCauley
<FN>
<F*> Original powers of attorney authorizing Matthew P. McCauley to sign
this Registration Statement and Amendments thereto on behalf of the
Board of Directors of General American Life Insurance Company are on
file with the Securities and Exchange Commission.
</TABLE>
<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
- ------- -----------
1. Memorandum describing issuance, transfer, and redemption procedures
pursuant to Rule 6e-3(T)
2. Form of application for Destiny Universal Life Insurance
3. Consent of KPMG LLP, Independent Certified Public Accountants
<PAGE>
EXHIBIT 1
GENERAL AMERICAN LIFE INSURANCE COMPANY
DESCRIPTION OF ISSUANCE, TRANSFER
AND REDEMPTION PROCEDURES FOR
VARIABLE LIFE INSURANCE POLICIES
PURSUANT TO RULE 6E-3(T)(b)(12)(ii)
AND
METHOD OF COMPUTING ADJUSTMENTS IN
PAYMENTS AND CASH VALUES UPON
CONVERSION TO FIXED BENEFIT POLICIES
PURSUANT TO RULE 6E-3(T)(b)(13)(v)(B)
This document sets forth the administrative procedures that will be
followed by General American Life Insurance Company (the "Company") in
connection with the issuance of its Destiny Variable Life Insurance Policy.
The policy forms are referred to collectively as "Destiny" or as the
"Policies" or "Policy." This document also addresses the transfer of
assets held under the Policy and the redemption by Owners of their
interests in such Policies, and explains the method that the Company will
follow in making a cash adjustment when a Policy is exchanged for a fixed
benefit insurance policy pursuant to Rule 6e-3(T)(b)(13)(v)(B).
I. PROCEDURES RELATING TO ISSUANCE AND PURCHASE OF POLICIES
A. Premium Payments and Underwriting
Premiums for the Policies will not be the same for all owners
of Policies ("Owners"). The Company must receive an initial
premium, which may be all or part of the first annual premium,
together with a completed application, before a Policy will be
issued. The initial premium for a Policy is determined by the
Owner at the time of application, and is shown in the
application and on the Policy's specifications page.
When the Owner applies for the policy, he or she determines the
amount of the premium to be paid each year. The first year's
premium payment must be at least $20,000. The scheduled
premium for future years does not have to be level - it may be
different from year to year to meet the Owner's anticipated
needs.
After paying the initial premium, the Owner makes future
premium payments according to the schedule that he or she has
established. The scheduled premiums are shown on the policy
specifications page. We will send a bill based on the
schedule. The Owner may make each year's scheduled premium
payment in a lump sum or in installments at any time during the
policy year.
<PAGE>
<PAGE>
The Owner may not pay more premiums than the amount billed. He
or she may pay less than the scheduled premium, but there are
some important restrictions as described below.
On each Policy Anniversary we will review the premiums paid
into the policy. If the total amount of premiums paid since
the policy's issue date has always been at least 80% of the
total scheduled premiums since the policy's issue date, then
the Owner may pay any amount of premium up to the current
scheduled amount for that Policy Year. If the total amount of
the premiums paid is less than 80% of the total scheduled
premium, we will notify the Owner of the amount of the
shortfall and the consequences of failing to pay at least 80%
of the scheduled premium.
There is a period of 62 days from the end of the policy year,
called the "grace period." If the Owner pays a premium during
the grace period, and if the Owner has paid less than the
scheduled premium (or less than the restricted premium, if
applicable) for the policy year that just ended, then we will
treat the premium payment as having been made in the prior
policy year. By doing this, we allow the Owner greater
flexibility in deciding how much premium he or she wants to pay
in the current policy year. If the sum of the premium paid
during the grace period and the premium already applied to the
prior policy year exceed the amount allowed for the prior
policy year, then we will treat any excess as a premium payment
for the current policy year.
If, on the other hand, a premium remains unpaid after the grace
period, and if the total premium paid since the policy's issue
date is less than 80% of the scheduled premiums, then future
annual premiums payable are limited to the lesser of:
1. the scheduled annual premium, or
2. the annual premium paid in the year in which the
cumulative premiums paid fell below 80% of the scheduled
cumulative premium.
If the Owner does not pay the lesser of these two amounts, no
further premiums are payable. We will not accept any more
premiums unless they are necessary to pay the charges and
deductions under the policy.
This limit will remain in force for all future years unless the
Owner reinstates the premium schedule as described under
Premium Default and Reinstatement.
We will deduct certain expenses from the Policy's cash value.
These expenses are described below. In addition, the cash
value may increase or decrease, depending on the investment
experience of the funds the Owner selects. Because it is
possible for the cash value to decrease, the death benefit may
also decrease. If the cash value is insufficient to pay the
charges and deductions, we will allow the Owner to pay
sufficient premium into the policy to cover the current charges
<PAGE>
<PAGE>
and deductions. If the Owner does not make such premium
payments, the policy will terminate without value.
The Company will determine current cost of insurance rates
based upon expectations as to future mortality experience. The
cost of insurance rates are guaranteed not to exceed rates
based upon the Commissioners' 1980 Standard Ordinary Mortality
Tables.
The Policies will be offered and sold pursuant to established
underwriting standards and in accordance with state insurance
laws. State insurance laws may prohibit unfair discrimination
among insureds but recognize that cost of insurance charges may
be based upon factors such as age, sex, health, and occupation.
B. Application and Initial Premium Processing
Upon receipt of a completed application, the Company will
follow certain insurance underwriting (i.e., evaluation of
risks) procedures designed to determine whether the applicant
is insurable. This process may involve such verification
procedures as medical examinations and may require that further
information be provided by the proposed insured before a
determination can be made. A Policy will not be issued until
the underwriting procedure has been completed.
Insurance coverage under a Policy will begin on the issue date,
which is the date as of which the Policy is delivered and the
initial premium has been received prior to the insured's death
and prior to any change in health as shown in the application.
The issue date is used to determine Policy anniversaries,
Policy years and Policy months.
After the issue date the Company will generally allocate the
net premium received during the "right to examine policy
period" to the division of the General American Life Insurance
Company Separate Account Eleven (the "Separate Account") that
invests in the Money Market Fund of General American Capital
Company. Upon expiration of this period, the cash value in
that division will be transferred to the divisions of the
Separate Account and to the Company's General Account in
accordance with the Owner's allocation instructions.
C. Reinstatement Procedures
A premium is in default if the Owner does not pay it on or
before the last day of the Policy year. We will allow a grace
period of 62 days for payment of each premium except the first.
The grace period begins on the last day of the Policy year for
which the premium payment was due. If the Owner pays a premium
during the grace period, and if he or she has paid less than
the scheduled premium (or less than the restricted premium, if
applicable), we will treat the premium payment as having been
made in the prior Policy year. If the sum of the premium paid
during the grace period and the premium already applied to the
prior Policy
<PAGE>
<PAGE>
year exceed the amount allowed for the prior Policy year, then
we will treat any excess as a premium payment for the current
Policy year.
If premium payments have been restricted because the Owner has
not paid at least 80% of the scheduled premiums on a cumulative
basis, the Owner may apply to reinstate the premium payment
schedule as described below.
The Owner may reinstate premium payments within three years
after the date of default of a premium payment, provided that
he or she has not surrendered the policy and that:
1. the Owner submits a written request for reinstatement;
2. the Owner submits proof satisfactory to us that the
Insured is insurable by our standards;
3. the Owner pays all overdue premiums;
4. the Insured is alive on the date we approve the request
for reinstatement. If the insured is not alive, the
approval is void with no effect.
For purposes of reinstatement, the term "all overdue premiums"
shown in item 3 above means the greater of (a) the amount of
the originally scheduled premium for the current Policy Year,
or (b) the amount of premium required so that the total
premiums paid since the Issue Date (without interest) is equal
to 80% of the cumulative scheduled premium.
After deducting any applicable Federal Tax Charge and State Tax
Charge, we will allocate the Net Premiums paid under item 3
above into the General Account or the Divisions of the Separate
Account according to the Owner's current allocation
instructions.
The Policy with its reinstated premium schedule will be in
force from the date we approve the reinstatement application.
There will be a full monthly deduction for the Policy Month
which includes this date. Any application for reinstatement
becomes part of the contract of reinstatement and of the
Policy.
II. REDEMPTION PROCEDURES: SURRENDER AND RELATED TRANSACTIONS
Set forth below is a summary of the principal Policy provisions and
administrative procedures which might be deemed to constitute, either
directly or indirectly, a "redemption" transaction. The summary
shows that because of the insurance nature of the policies, the
procedures involved necessarily differ in certain significant
respects from the redemption procedures for mutual funds and
contractual plans.
A. Surrenders and Pro-Rata Surrenders
After the first policy year, during the lifetime of the insured
and while a Policy is in effect, the Owner may surrender or
make a pro-rata (partial) surrender of the
<PAGE>
<PAGE>
Policy by sending a written request to the Company. The amount
available for surrender is the cash surrender value at the end
of the valuation period during which the surrender request is
received at the Company's home office. Amounts payable from
the Separate Account upon surrender or a pro-rata surrender
will ordinarily be paid within seven days of receipt of the
written request.
If the Policy is being surrendered, the Policy itself must be
returned to the Company along with the request. Upon
surrender, the Company will pay the cash surrender value (the
cash value, plus unearned cost of insurance charges from the
date of surrender to the end of the policy month, less any
indebtedness). Surrender proceeds may be paid in a single sum
or under one of the settlement options. Coverage under a
Policy will terminate as of the date of surrender.
If the Policy is being pro-rata surrendered, the cash value and
the death benefit will be reduced by a percentage specified by
the Owner. This percentage may be any whole number. The
percentage will be applied to the death benefit and the cash
value effective on the date we receive the request.
The Owner may allocate the amount of decrease in the cash value
among the divisions of the Separate Account and the General
Account. If no allocation is specified, then the reduction
will be allocated among the divisions of the Separate Account
and the General Account in the same proportion that the
Policy's cash value in each division and the General Account
bears to the total cash value of the Policy, less the cash
value in the Loan Account, on the date the request for the pro-
rata surrender is received.
The death benefit will be affected by a pro-rata surrender.
A Pro-Rata Surrender will not be processed for less than $500
or if it will reduce the Cash Value below $10,000. No Pro-Rata
Surrender will be processed for more Cash Surrender Value than
is available on the date of the Pro-Rata Surrender. A cash
payment will be made to the Owner for the amount of Cash Value
reduction.
B. Changes in Face Amount
Because the death benefit is determined by the cash value of
the Policy, changes in face amount are not available under the
Policy.
C. Change in Death Benefit Option
Because the death benefit is determined by the cash value of
the Policy, death benefit options are not available under the
Policy.
<PAGE>
<PAGE>
D. Benefit Claims
While the Policy remains in force, the Company will pay a death
benefit to the named beneficiary in accordance with the
designated death benefit option within seven days after receipt
in its home office of due proof of death of the insured.
Payment of death benefits may be postponed under certain
circumstances, such as the New York Stock Exchange being closed
for reasons other than customary weekend and holiday closings.
If the person insured is less than attained age 100 at the time
of death, the death benefit will be equal to the policy's cash
value on the date of death, multiplied by an attained age
factor. The attained age factors are shown on a table in the
policy. The factors shown in the policy are for deaths
occurring on the policy anniversary. For any other date, we
will determine the factor by interpolation, or calculating the
daily value between the anniversary dates.
If the person insured has reached attained age 100 at the time
of death, the death benefit will be equal to 101% of the
policy's cash value (100% if required by state law).
We will increase the policy proceeds by the cost of insurance
from the date of death to the end of the policy month, and
reduce them by any outstanding loans and interest. We will pay
the death benefit according to the settlement options available
at the time of death.
E. Policy Loans
The Owner may borrow against the cash value of a Policy. The
loan value is the maximum amount that may be borrowed. The
loan value is:
* the cash value on the date we receive the loan request;
* plus interest on the loan balance to the next policy
anniversary, calculated at the guaranteed general account
interest rate;
* minus interest on the new loan to the next policy
anniversary;
* minus any loans and interest already outstanding;
* minus monthly deductions to the next policy anniversary.
Unless the Owner specifies otherwise, when he or she borrows
against the policy, we will take the money from the general
account and the divisions of the separate account in proportion
to the balances in each account.
Loan interest is due at each policy anniversary. If the Owner
does not pay the loan interest, we will add it to the amount of
the loan.
The Owner may repay all or part of the loan at any time. When
he or she make a loan payment, we will put the money back into
the general account or the divisions of the separate account in
the same percentages used to make the loan.
<PAGE>
<PAGE>
When we pay out the proceeds of the policy, either as a death
benefit or as a policy surrender, we will deduct any
outstanding loans and interest from the amount we pay.
III. TRANSFERS
The Separate Account has multiple divisions. Under the Company's
current rules, a Policy's cash value, except amounts credited to the
Loan Account, may be transferred among the divisions of the Separate
Account and between the General Account and the divisions. Requests
for transfers from or among divisions of the Separate Account may be
made up to twelve times in a Policy year at no charge. The company
reserves the right to charge a fee not to exceed $25 for transfers or
partial withdrawals in excess of twelve in a Policy year. Transfers
must be in amounts of at least $500 or, if smaller, the Policy's cash
value in a division. The Company will make transfers and determine
all values in connection with transfers as of the end of the
valuation period during which the transfer request is received.
The Company currently intends to continue to permit transfers for the
foreseeable future. The Policy provides that the Company may at any
time revoke or modify the transfer privilege, including the minimum
amount transferable.
IV. REFUNDS
A. Right to Examine Policy Period
An Owner may cancel a Policy within the latest of 20 days after
receiving it, 45 days after the application was signed, or 10
days of mailing a notice of the cancellation right (or such
longer time as may be required by law). If a Policy is
cancelled within this time period a refund will be paid. The
refund will generally equal all premiums paid under the Policy.
For policies issued in certain states, the amount of the refund
may reflect investment gains or losses.
To cancel the Policy, the Owner must mail or deliver the Policy
to either the Company or the agent who sold it. A refund of
premiums paid by check may be delayed until the check has
cleared the Owner's bank.
B. Suicide
In the event the insured commits suicide, whether sane or
insane, within two years of the issue date, the amount payable
will be limited to the return of premiums paid, less any
indebtedness or partial withdrawals. This provision may be
modified to comply with the laws of any state in which the
Policy is issued.
<PAGE>
<PAGE>
C. Incontestability Clause
The Policy is incontestable after it has been in force for two
years from the issue date during the lifetime of the insured.
Any reinstatement of a Policy's premium schedule is
incontestable only after it has been in force during the
lifetime of the insured for two years after the effective date
of the reinstatement.
D. Misstatement of Age or Sex
If the age or sex (except as required by state law) of the
insured has been misstated in the application, the amount of
the death benefit will be that which the most recent attained
age factor would have purchased for the correct age and sex.
V. METHOD OF COMPUTING EXCHANGE ADJUSTMENTS PURSUANT TO PARAGRAPH
(b)(13)(v)(B) OF RULE Ee-3(T) UNDER THE INVESTMENT COMPANY ACT
OF 1940
During the first 24 Policy months following the issuance of the
Policy, the Owner may in effect convert any Policy still in force to
a guaranteed benefit life insurance policy by transferring the
Policy's cash value in the Separate Account to the General Account.
Transfers made pursuant to this conversion right will not affect the
death benefit, face amount, net amount at risk, rate class or issue
age under a Policy. No charge will be imposed on any transfers
resulting from the exercise of this conversion privilege, and such
transfers will not count against the limitation on the amount and
frequency of transfer requests allowed in each Policy year.
The cash value of the new Policy on the exchange date will equal the
cash value of the Policy on the valuation date immediately prior to
the exchange date, plus the cash value provided by any net premium
credited to the new Policy on the exchange date less monthly
deductions under the new Policy. The same conditions and principles
applicable to the exchange of an entire policy are equally applicable
to an exchange relating to an increase.
No further adjustments are made in cash values and payments upon an
exchange.
<PAGE>
EXHIBIT 2
General
American [Logo]
Life Insurance Company
ST. LOUIS, MISSOURI APPLICATION FOR LIFE INSURANCE
APPLICATION PART I:
1. PROPOSED INSURED
- -------------------------------------------------------------------
First Name Initial Last Name
-----------------------------------------------------
-------------------------------------------------------------
DATE OF BIRTH STATE OF BIRTH SEX
-----------------------------------------/ / Male / / Female
Social Security Number
-------------------------------------------------------------
Home Address (Number, Street, Apt. #)
-------------------------------------------------------------
City State Zip
-------------------------------------------------------------
Occupation Earned Income Net Worth
-------------------------------------------------------------
Day Phone Number Evening Phone Number
-------------------------------------------------------------
Best days and time to call (Indicate a.m. or p.m.)
-------------------------------------------------------------
- -------------------------------------------------------------------
2. BENEFICIARY
Provide Full Name and Relationship of each to Proposed Insured.
- -------------------------------------------------------------------
Primary
-------------------------------------------------------------
Contingent
- -------------------------------------------------------------------
3. OWNER (IF OTHER THAN PROPOSED INSURED)
Provide Full Name, Address, and Relationship to Proposed Insured.
- -------------------------------------------------------------------
Original
Social Security or Tax Number
of Original Owner (REQUIRED BY LAW)
-------------------------------------------------------------
Contingent
- -------------------------------------------------------------------
<PAGE>
4. PLAN, BENEFITS, RIDERS, & BILLING
- -------------------------------------------------------------------
Plan Name
-------------------------------------------------------------
Benefit Riders (If available on plan selected)
Amount
-------------------------------------------------------------
Premium Schedule
Additional Premium
$ Dollars Lump Sum in Year 1
--------
Scheduled Premium
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
$ Dollars For years
-------- ---------
- -------------------------------------------------------------------
<PAGE>
<PAGE>
5. FUNDS
- -----------------------------------------------------------------------------
Net Premium Allocation: (0 or minimum of 1%. Percentages must be in whole
numbers and total 100%.)
[General American Capital Company:
Money Market Fund %
------
S & P 500 Index %
------
Bond Index Fund %
------
Managed Equity Fund %
------
Asset Allocation Fund %
------
International Index Fund %
------
Mid-Cap Equity Fund %
------
Small-Cap Equity Fund %
------
American Century:
Income & Growth Fund %
------
International Fund %
------
Value Fund %
------
J.P. Morgan Series Trust II:
Bond Portfolio %
------
Small Company Portfolio %
------
Fidelity's VIP and VIP II Funds:
Equity-Income Portfolio %
------
Growth Portfolio %
------
Overseas Portfolio %
------
High Income Portfolio %
------
Asset Manager Portfolio %
------
---------------------------
Van Eck Worldwide Insurance Trust:
Worldwide Hard Assets
Fund %
------
Worldwide Emerging
Markets Fund %
------
Other %
------------------- ------
Other %
------------------- ------
Other %
------------------- ------
Other %
------------------- ------
General Account %]
------
===============================
TOTAL ALLOCATION %
==============
- -----------------------------------------------------------------------------
<PAGE>
6. SUITABILITY INFORMATION (To be completed by owner.)
- -----------------------------------------------------------------------------
Have you received a Prospectus/Memorandum of Understanding
for the policy applied for? / / Yes / / No
Date of Prospectus/Memorandum of
Understanding
---------------------------
Date of any supplement
-------------------------
Is a current Customer Information Statement for this owner
on file with Walnut Street Securities? (If "No," one must
be submitted with this application.) / / Yes / / No
Do you understand that:
- THE DEATH BENEFIT AND CASH SURRENDER VALUE WILL
INCREASE OR DECREASE DEPENDING ON THE INVESTMENT
EXPERIENCE? / / YES / / NO
- THERE IS NO GUARANTEED MINIMUM DEATH BENEFIT OR
CASH SURRENDER VALUE? / / YES / / NO
Do you believe that the policy applied for meets your
insurance needs and your anticipated financial needs? / / Yes / / No
I request a copy of the Statement of Additional Information for the
following Investment Company(ies):
-------------------------------------------------------------------------
-------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<PAGE>
<PAGE>
7. OTHER INSURANCE
- -----------------------------------------------------------------------------
a. Total Life Insurance now in force on Proposed Insured.
If "None", check / /
<TABLE>
<CAPTION>
Year of Personal Business Accidental Waiver of Prem.
Company and Policy # Issue Ins. Amount Ins. Amount Death Amt. Yes No
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------
</TABLE>
If additional space is needed, provide information in
"Details" section.
b. Are you currently applying for life insurance
with any other company? / / Yes / / No
(If "Yes", provide information in "Details"
section.)
c. Will the insurance being applied for replace or
change any of the above or any in force
annuities? / / Yes / / No
d. Will the insurance being applied for receive any
values (to pay premiums or additional payments)
from another policy/contract? / / Yes / / No
If either "c" or "d" is answered "Yes", circle
affected coverage above or indicate in "Details"
section.
Policy/contract number MUST be provided. (Complete and
submit required replacement forms.)
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8. CURRENT DATE EXCHANGE
- -----------------------------------------------------------------------------
Please complete this section to request the replacement of an existing
General American policy.
Name of Insured (First, Initial, Last) Policy Number(s) to be exchanged
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Do you want Federal Income Tax withheld on any taxable
part of the exchange? / / Yes / / No
An exchange may result in a taxable event. If so, it is possible that
withholding would apply. Election out of withholding can be made by
completing the above question. If not elected, Federal Income Tax will be
withheld on the taxable portion, if any, at a rate of 10%. Failure to
provide a Tax Identification Number (Section 3) will require us to withhold
31% of the taxable portion, if any, regardless of election. If you
exchange an existing policy for a new policy, the new policy will be
subject to TAMRA legislation beginning on the effective date of the new
policy.
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9. GENERAL INFORMATION
- -----------------------------------------------------------------------------
Have you: (Provide explanation of "Yes" answers in "Details"
section.)
a. Ever been declined, postponed, rated or offered a
policy different than that applied for? / / Yes / / No
b. Any intention to travel or reside outside the
United States? / / Yes / / No
c. Been a pilot or student pilot during the past 3
years or have any intention of becoming a pilot or
student in any type of aircraft? / / Yes / / No
(If "Yes", complete Aviation Supplement.)
d. Participated in, or do you contemplate participating
in: aeronautics, competitive racing, underwater or
sky diving, mountain climbing, or any other similar
avocation? / / Yes / / No
(If "Yes", complete Avocation Supplement.)
e. Ever had a traffic citation for driving while
intoxicated or driving under the influence of
intoxicants or drugs? / / Yes / / No
f. Within the past three years, had any moving vehicle
violation? / / Yes / / No
Provide Driver's License Number State
- -----------------------------------------------------------------------------
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<PAGE>
<PAGE>
10. DETAILS TO "YES" ANSWERS
- -----------------------------------------------------------------------------
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11. ADDITIONAL INSTRUCTIONS
- -----------------------------------------------------------------------------
Additional Instructions/Home Office Endorsement
- -----------------------------------------------------------------------------
12. ELECTRONIC FUND PROSPECTUS OPTION
- -----------------------------------------------------------------------------
In the future, General American may deliver prospectus updates, semi-annual
and annual reports to consenting policy owners electronically by the
delivery methods listed below. If you wish to receive future updates in
this manner, please indicate your consent by checking the appropriate box.
/ / 1) Mail a diskette containing the document
/ / 2) Mail a CD-ROM containing the document
/ / 3) E-mail the document; or
/ / 4) E-mail a notice identifying an Internet site where the
document can be viewed and downloaded.
Whichever option you choose, General American will supply the
document in a format compatible with one of the following (please
choose one):
/ / Microsoft Windows
/ / Macintosh
You may incur normal and customary online usage charges to receive a
document under option 3 or 4. If option 3 or 4 is checked, please insert
your e-mail address here ( ).
---------------------------------------------
If you consent to electronic delivery, at any time you may also request
that we send you a paper copy. This consent will be in effect until you
revoke it. You can revoke your consent at any time by calling General
American's Executive Benefits Services at: 1-877-852-2682 or writing to
General American's Executive Benefit Services, P.O. Box 66957, St. Louis,
MO 63166.
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<PAGE>
<PAGE>
DECLARATIONS
I agree that all the statements and answers in this application and any
amendments to it, including any supplements, are true, complete and
correctly recorded. I also agree that this application, any required
medical examination, and any supplement or amendment to either will be part
of the policy issued. If a premium payment is given in exchange for a
Temporary Insurance Agreement (TIA), the Company will be liable only as set
forth in that Agreement. If a premium payment is not given, then insurance
will take effect when a policy is approved by the Company for issue as
applied for, the first full premium is paid, and the health and
insurability of any person proposed for insurance have not changed since
the date of this application. If a policy is issued other than as applied
for, insurance will take effect under the policy only when a policy issued
by the Company is delivered to and accepted by me, the first full premium
is paid, and the health and insurability of any person proposed for
insurance have not changed since the date of this application.
PROPOSED INSURED'S AUTHORIZATION
I authorize any physician, medical practitioner, hospital, clinic, other
medical or medically related facility, insurance company, the Medical
Information Bureau (MIB), consumer reporting agency or employer to release
to General American Life Insurance Company, its subsidiaries, its
reinsurers or its legal representatives any information they may have
relative to diagnosis, treatment and prognosis of any physical or mental
condition including drug and/or alcohol abuse and/or any other information
about me. I understand that any information obtained will be used to
determine eligibility for insurance and will not be released to any person
or organization except reinsurers, the MIB, other persons or organizations
performing business or legal services in connection with my application,
and other insurance companies to whom I have applied or to whom a claim has
been made, or as may be otherwise lawfully required, or as I may further
authorize. I know that I may request a copy of this authorization. I also
acknowledge receipt of the Notice of Information Practices. I understand
that if an investigative consumer report is ordered in connection with this
application, I may be interviewed in connection with the preparation of the
report and, upon request, I will be provided with a copy of the report. A
photographic copy of this authorization will be as valid as the original.
This authorization will be valid for 30 months from the date shown below.
OWNER'S CERTIFICATION: UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT: 1)
THE NUMBER SHOWN ON THIS FORM IS MY CORRECT TAXPAYER IDENTIFICATION NUMBER
(OR, IF NO NUMBER IS SHOWN, I AM WAITING FOR A NUMBER TO BE ISSUED TO ME);
AND 2) I AM NOT SUBJECT TO BACKUP WITHHOLDING EITHER BECAUSE I HAVE NOT
BEEN NOTIFIED BY THE INTERNAL REVENUE SERVICE (IRS) THAT I AM SUBJECT TO
BACKUP WITHHOLDING AS A RESULT OF A FAILURE TO REPORT ALL INTEREST OR
DIVIDENDS, OR THE IRS HAS NOTIFIED ME THAT I AM NO LONGER SUBJECT TO BACKUP
WITHHOLDING.
PLEASE NOTE: CROSS OUT AND INITIAL #2) ABOVE IF YOU HAVE BEEN NOTIFIED BY
THE IRS THAT YOU ARE CURRENTLY SUBJECT TO BACKUP WITHHOLDING BECAUSE OF
UNDER-REPORTING INTEREST OR DIVIDENDS ON YOUR TAX RETURN.
THE IRS DOES NOT REQUIRE CONSENT TO ANY PROVISION OF THIS DOCUMENT OTHER
THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP WITHHOLDING.
- -----------------------------------------------------------------------------
AGENT: Do you certify that you have truly and accurately
recorded on this application the information supplied
by the applicant? / / Yes / / No
In light of the financial need of the Proposed Insured and Owner, the
purpose of this sale has been discussed with the Owner, and I believe this
application to be a suitable recommendation.
To the best of your knowledge, is this a replacement?
(If "Yes", complete and submit required replacement
forms.) / / Yes / / No
For VUL: Did you deliver the current prospectus and were
all of the written sales materials used printed by
General American Life Insurance Company? / / Yes / / No
X
-------------------------------------------------------
Signature of Licensed Agent
- -----------------------------------------------------------------------------
<PAGE>
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-------------------------------------------------------------------------
State Where Signed
-------------------------------------------------------------------------
Date (MM/DD/YY)
X
------------------------------------------------------------------------
Signature of Proposed Insured (Parent or Guardian
if Proposed Insured under age 18.)
X
------------------------------------------------------------------------
Signature of Owner (If other than Proposed Insured
or Applicant)
X
-----------------------------------------------------------------------
Signature of Applicant (If other than Proposed Insured
or Owner)
- -----------------------------------------------------------------------------
<PAGE>
EXHIBIT 3
The Board of Directors
General American Life Insurance Company
Re: Destiny Variable Universal Life Insurance
We consent to the use of our reports included herein and to the reference
to our firm under the heading "Experts" in the Registration Statement and
Prospectus for General American Separate Account Eleven.
KPMG LLP
St. Louis, Missouri
March 31, 2000
