SECURITY FIRST LIFE SEPARATE ACCOUNT A
485BPOS, 1996-04-30
DRILLING OIL & GAS WELLS
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<PAGE>   1
                                                        '33 ACT FILE NO. 33-7094
                                                       '40 ACT FILE NO. 811-3365

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM N-4

                   REGISTRATION STATEMENT UNDER THE SECURITIES
                                   ACT OF 1933

                      PRE-EFFECTIVE AMENDMENT NO. ____           / /
   
                       POST-EFFECTIVE AMENDMENT NO. 25           /X/
    
                                     AND/OR

                   REGISTRATION STATEMENT UNDER THE INVESTMENT
                               COMPANY ACT OF 1940

   
                              AMENDMENT NO. 71                   /X/
                        (CHECK APPROPRIATE BOX OR BOXES.)
    

                     SECURITY FIRST LIFE SEPARATE ACCOUNT A
                           (EXACT NAME OF REGISTRANT)

                      SECURITY FIRST LIFE INSURANCE COMPANY
                               (NAME OF DEPOSITOR)

           11365 WEST OLYMPIC BOULEVARD, LOS ANGELES, CALIFORNIA 90064
         (ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

        DEPOSITOR'S TELEPHONE NUMBER, INCLUDING AREA CODE: (310) 312-6100

                               RICHARD C. PEARSON
                    SENIOR VICE PRESIDENT AND GENERAL COUNSEL
                      SECURITY FIRST LIFE INSURANCE COMPANY
           11365 WEST OLYMPIC BOULEVARD, LOS ANGELES, CALIFORNIA 90064
                     (NAME AND ADDRESS OF AGENT FOR SERVICE)

IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE SPACE)

          IMMEDIATELY UPON FILING PURSUANT TO PARAGRAPH (b) OF RULE 485
   
   -----
     X    ON MAY 1, 1996 PURSUANT TO PARAGRAPH (b) OF RULE 485 
   -----
    
          60 DAYS AFTER FILING PURSUANT TO PARAGRAPH (a) OF RULE 485
   -----
          ON [DATE] PURSUANT TO PARAGRAPH (a) OF RULE 485
   -----

IF APPROPRIATE, CHECK THE FOLLOWING BOX:

          THIS POST-EFFECTIVE AMENDMENT DESIGNATES A NEW EFFECTIVE DATE FOR A
   -----
          PREVIOUSLY FILED POST-EFFECTIVE AMENDMENT.

   
THE COMPANY HAS ELECTED PURSUANT TO RULE 24f-2 UNDER THE INVESTMENT COMPANY ACT
OF 1940 TO REGISTER AN INDEFINITE NUMBER OF SECURITIES. THE MOST RECENT RULE
24f-2 NOTICE WAS FILED ON FEBRUARY 23, 1996.
    
<PAGE>   2
                     SECURITY FIRST LIFE SEPARATE ACCOUNT A

                              Cross Reference Sheet
                   Part A - Prospectuses for Combination Fixed
                and Variable and Variable only Annuity Contracts

<TABLE>
<CAPTION>
        Item Number in Form N-4                         Caption in Prospectus
        -----------------------                         ---------------------
<S>     <C>                                             <C>
1.      Cover Page                                      Cover Page

2.      Definitions                                     Glossary

3.      Synopsis                                        Summary of the Contracts

4.      Condensed Financial Information                 Condensed Financial Information; Performance;
                                                        Financial Information

5.      General Description of Registrant,              Description of Security First Life Insurance
        Depositor, and Portfolio Companies              Company, The General Account, The Separate Account
                                                        and The Funds; Voting Rights; Servicing Agent

6.      Deductions and Expenses                         Contract Charges

7.      General Description of Variable Annuity         Description of the Contracts; Accumulation Period;
        Contracts                                       Annuity Benefits

8.      Annuity Period                                  Annuity Benefits

9.      Death Benefit                                   Death Benefits

10.     Purchases and Contract Value                    Description of the Contracts; Accumulation Period;
                                                        Principal Underwriter

11.     Redemptions                                     Accumulation Period

12.     Taxes                                           Federal Income Tax Status

13.     Legal Proceedings                               Legal Proceedings

14.     Table of Contents of the Statement of           Table of Contents of Statement of 
        Additional Information                          Additional Information
</TABLE>
<PAGE>   3
                  PART B - STATEMENT OF ADDITIONAL INFORMATION

<TABLE>
<S>     <C>                                             <C>
15.     Cover Page                                      Cover Page

16.     Table of Contents                               Table of Contents

17.     General Information and History                 The Insurance Company; The Separate Account; The
                                                        Funds

18.     Services                                        Servicing Agent; Safekeeping of Securities;
                                                        Independent Public Accountant; Legal Matters

19.     Purchase of Securities Being Offered            Purchase of Securities Being Offered

20.     Underwriters                                    Underwriters, Distribution of the Contracts

21.     Calculation of Performance Data                 Calculation of Performance Data

22.     Annuity Payments                                Annuity Payments

23.     Financial Statements                            Financial Statements
</TABLE>

                                     PART C

Information required to be included in Part C is set forth under the appropriate
item, so numbered, in Part C of this registration statement.
<PAGE>   4
 
                     SECURITY FIRST LIFE SEPARATE ACCOUNT A
- --------------------------------------------------------------------------------
 
                          INDIVIDUAL FLEXIBLE PAYMENT
                      FIXED AND VARIABLE ANNUITY CONTRACTS
 
                     Security First Life Insurance Company
                          11365 West Olympic Boulevard
                         Los Angeles, California 90064
- --------------------------------------------------------------------------------
 
The individual flexible payment, Fixed and Variable Annuity Contracts (the
"Contracts") described in this Prospectus are issued by Security First Life
Insurance Company ("Security First Life"). The Contracts are designed to provide
Annuity benefits in connection with required distributions from retirement plans
that qualify under the Internal Revenue Code of 1986, as amended (the "Code").
 
The Contracts may also be used to provide Annuity benefits prior to any
mandatory distributions and also in connection with retirement plans which are
not qualified under the Code.
 
   
Eleven Funds constitute the underlying investment medium for the Contracts: (i)
the Money Market Portfolio, Equity-Income Portfolio, Growth Portfolio and
Overseas Portfolio of the Variable Insurance Products Fund; (ii) the Asset
Manager Portfolio, Contrafund Portfolio and Index 500 Portfolio of the Variable
Insurance Products Fund II; (iii) the Virtus U.S. Government Income Series
(formerly the U.S. Government Income Series), T. Rowe Price Bond Series
(formerly the Bond Series) and T. Rowe Price Growth and Income Series (formerly
the Growth and Income Series) of the Security First Trust and (iv) the Small
Capitalization Portfolio of The Alger American Fund.
    
 
   
This Prospectus sets forth information a prospective investor should know before
investing. Additional information about the Contracts has been filed with the
Securities and Exchange Commission ("SEC") in a Statement of Additional
Information, dated May 1, 1996, which information is incorporated herein by
reference and is available without charge upon written request to Security First
Life Insurance Company, P.O. Box 92193, Los Angeles, California 90009 or by
telephoning 1(800) 284-4536.
    
 
The table of contents of the Statement of Additional Information appears on page
23 of the Prospectus.
- --------------------------------------------------------------------------------
 
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING OF SHARES OF ANY UNDERLYING FUND
FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN RECEIVED AND IN NO EVENT WILL
DESIGNATION OF AN UNDERLYING FUND FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN
RECEIVED BE PERMITTED UNLESS THE OWNER RECEIVES SUCH A PROSPECTUS.
 
PLEASE READ AND RETAIN THIS PROSPECTUS FOR FUTURE REFERENCE.
- --------------------------------------------------------------------------------
 
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 THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
 
                                IMPORTANT NOTICE
ANNUITIES, MUTUAL FUNDS, AND OTHER INVESTMENTS ARE NOT INSURED BY THE FDIC OR
ANY OTHER GOVERNMENT AGENCY. THEY ARE NOT DEPOSITS, OBLIGATIONS, OR GUARANTEED
BY ANY BANK. THEY INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL AMOUNT INVESTED.
- --------------------------------------------------------------------------------
 
   
Prospectus dated May 1, 1996                                   SF 135 R2C (5/96)
    
<PAGE>   5
 
                               TABLE OF CONTENTS
 
<TABLE>
<CAPTION>
                                                                                                    PAGE
                                                                                                    ----
<S>                                                                                                 <C>
Glossary..........................................................................................    3
Summary of the Contracts..........................................................................    4
Fee Tables........................................................................................    6
Condensed Financial Information...................................................................    9
Performance.......................................................................................   10
Financial Information.............................................................................   10
Description of Security First Life Insurance Company, The General Account
  The Separate Account and The Funds..............................................................   10
    The Insurance Company.........................................................................   10
    The General Account...........................................................................   10
    The Separate Account..........................................................................   10
    The Funds.....................................................................................   11
Principal Underwriter.............................................................................   12
Servicing Agent...................................................................................   13
Custody of Securities.............................................................................   13
Contract Charges..................................................................................   13
    Premium Taxes.................................................................................   13
    Surrender Charges.............................................................................   13
    Administration Fees...........................................................................   14
    Mortality Risk and Administrative Expense Risk Charge.........................................   14
    10-Day Free Look..............................................................................   14
Description of the Contracts......................................................................   14
    Assignment....................................................................................   14
    Purchase Payments.............................................................................   15
    Conversions...................................................................................   15
    Dollar Cost Averaging.........................................................................   15
    Reallocation Election.........................................................................   15
    Modification of the Contracts.................................................................   15
Accumulation Period...............................................................................   16
    Crediting Accumulation Units in the Separate Account..........................................   16
    Separate Account Accumulation Unit Current Values.............................................   16
    Net Investment Factor.........................................................................   16
    Surrender from the Separate Account...........................................................   16
    Statement of Account..........................................................................   16
Annuity Benefits..................................................................................   17
    Variable Annuity Payments.....................................................................   17
    Assumed Investment Return.....................................................................   17
    Election of Annuity Date and Form of Annuity..................................................   17
    Frequency of Payment..........................................................................   18
    Level Payments Varying Annually...............................................................   18
    Annuity Unit Values...........................................................................   19
Death Benefits....................................................................................   19
    Death Before the Annuity Date.................................................................   19
    Death After the Annuity Date..................................................................   20
Federal Income Tax Status.........................................................................   20
    Qualified Contracts...........................................................................   20
    Non-Qualified Contracts.......................................................................   21
    Withholding...................................................................................   21
Voting Rights.....................................................................................   22
Legal Proceedings.................................................................................   22
Additional Information............................................................................   22
Table of Contents of Statement of Additional Information..........................................   23
</TABLE>
 
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus in connection with
the offer described herein and, if given or made, such information or
representations must not be relied upon as having been authorized. This
Prospectus does not constitute an offer in any jurisdiction to any person to
whom such offer would be unlawful therein.
 
                                        2
<PAGE>   6
 
                                    GLOSSARY
 
As used in this Prospectus, these terms have the following meanings:
 
ACCUMULATION UNIT -- A measuring unit used to determine the value of an Owner's
interest in a Separate Account Series under a Contract at any time before
Annuity Payments commence.
 
ANNUITANT -- The person on whose life Annuity payments under a Contract are
based.
 
ANNUITY -- A series of income payments made to an Annuitant for a defined period
of time.
 
ANNUITY DATE -- The date on which Annuity payments begin.
 
ANNUITY UNIT -- A measuring unit used to determine the amount of Variable
Annuity payments based on a Separate Account Series under a Contract after such
payments have commenced.
 
ASSUMED INVESTMENT RETURN -- The investment rate selected by the Annuitant for
use in determining the Variable Annuity payments.
 
BENEFICIARY -- The person who has the right to a Death Benefit upon the death of
the Owner.
 
   
BUSINESS DAY -- Each Monday through Friday except for days the New York Stock
Exchange is not open for trading.
    
 
CONTRACT -- The agreement between Security First Life and the Contract Owner
covering the rights of the Owner.
 
CONTRACT DATE -- The date an Owner's Contract is issued.
 
CONTRACT VALUE -- The sum of the Owner's interest in the Separate Account Series
and the Owner's interest in the General Account. The Owner's interest in the
Separate Account Series is the sum of the values of the Accumulation Units. The
Owner's interest in the General Account is the accumulated value of the amounts
allocated to the General Account plus the interest credited thereon as
guaranteed in the Contract, less any prior withdrawals and/or amounts applied to
Annuity options.
 
CONTRACT YEAR -- A 12-month period starting on the Contract Date and on each
anniversary thereof.
 
FIXED ANNUITY -- An Annuity providing guaranteed level payments. Such payments
are not based upon the investment experience of the Separate Account.
 
FREE WITHDRAWAL AMOUNT -- The amount of the first surrender in a Contract Year
which may be surrendered without incurring a surrender charge.
 
FUND -- A diversified, open-end management investment company, or series
thereof, registered under the Investment Company Act of 1940 ("1940 Act") which
serves as the underlying investment medium for a Series in the Separate Account.
 
GENERAL ACCOUNT -- All assets of Security First Life other than those in the
Separate Account or any of its other segregated asset accounts.
 
NORMAL ANNUITY DATE -- The first day of the month coincident with or next
following the anniversary of the Contract Date nearest the Annuitant's 85th
birthday, or the 10th anniversary, if later.
 
OWNER -- The person who has title to the Contract.
 
PURCHASE PAYMENT -- The amounts paid to Security First Life in order to provide
benefits under the Contract.
 
SEPARATE ACCOUNT -- The segregated asset account entitled "Security First Life
Separate Account A" which has been established by Security First Life pursuant
to Delaware law to receive and invest amounts allocated and to provide Variable
Annuity benefits under the Contracts. The Separate Account is registered as a
unit investment trust under the 1940 Act.
 
SERIES -- The Accumulation Unit values and Annuity Unit values maintained
separately for each Fund whose securities are owned by the Separate Account.
 
VALUATION DATE -- Any Business Day used by the Separate Account to determine the
value of part or all of its assets for purposes of determining Accumulation and
Annuity Unit values for the Contract. Accumulation Unit values will be
determined each Business Day. There will be one Valuation Date in each calendar
week for Annuity Unit values. Security
 
                                        3
<PAGE>   7
 
First Life will establish the Valuation Date at its discretion, but until notice
to the contrary is given, that date will be the last Business Day in a week.
 
VALUATION PERIOD -- The period of time from one Valuation Date through the next
Valuation Date.
 
VARIABLE ANNUITY -- An Annuity providing payments which will vary annually in
accordance with the net investment experience of the applicable Separate Account
Series.
 
                            SUMMARY OF THE CONTRACTS
 
THE CONTRACTS
 
    The Contracts may be issued to plans qualifying for special tax treatment
("Qualified Contracts"), such as individual retirement annuities, Section 403(b)
tax-sheltered annuities, Section 457 deferred compensation plans, money purchase
pension plans and profit sharing plans. (See "Qualified Contracts," page 20.)
The Contracts may also be issued pursuant to retirement plans that do not
qualify for special tax treatment ("Non-Qualified Contracts") and to individuals
seeking to accumulate funds for retirement whether or not such individuals are
otherwise participating in qualified or non-qualified retirement plans. This
Prospectus is intended to serve as a disclosure document for the variable
portion of the Contracts only.
 
PURCHASE PAYMENTS
 
    Purchase Payments under the Contracts are made to the General Account, the
Separate Account or allocated between them. The minimum initial Purchase Payment
is $1,000 and each additional Purchase Payment must be at least $100 ($500
initial purchase payment and $100 additional payment for IRA's). There is no
initial sales charge, however, certain charges and deductions will be made to
the Contract Value. (See "Contract Charges," page 13.) Amounts allocated to the
Separate Account may be transferred among the Series at any time and any number
of times and may be transferred to the General Account at any time before being
applied to a Variable Annuity option. Amounts allocated to the General Account
may be transferred to the Separate Account only to be applied to a Variable
Annuity option. (See "Conversions," page 15.)
 
SEPARATE ACCOUNT
 
   
    Pursuant to the Participant's designation, Purchase Payments allocated to
the Separate Account are invested at net asset value in Accumulation Units of
one or more of eleven series, each of which consists of the shares of a
different Fund. The Funds presently consist of the Money Market Portfolio,
Equity-Income Portfolio, Growth Portfolio and Overseas Portfolio of the Variable
Insurance Products Fund, the Asset Manager Portfolio, Contrafund Portfolio, and
Index 500 Portfolio of the Variable Insurance Products Fund II, the Virtus U.S.
Government Income Series, T. Rowe Price Bond Series and the T. Rowe Price Growth
and Income Series of the Security First Trust, and the Small Capitalization
Portfolio of The Alger American Fund. The investment adviser of the Variable
Insurance Products Fund and the Variable Insurance Products Fund II is Fidelity
Management & Research Company ("FMR"). The investment adviser and manager of
Security First Trust is Security First Investment Management Corporation
("Security Management"). T. Rowe Price Associates, Inc., ("Price Associates") is
subadvisor to Security Management with respect to T. Rowe Price Bond Series and
T. Rowe Price Growth and Income Series and Virtus Capital Management, Inc.
("Virtus") is the subadvisor for the Virtus U.S. Government Income Series of
Security First Trust. The Small Capitalization Portfolio of The Alger American
Fund is managed and advised by Fred Alger Management, Inc. ("Alger Management").
(See "The Separate Account," page 10 and "The Funds," page 11.)
    
 
CHARGES AND DEDUCTIONS
 
    An administration fee will be deducted daily from the Owner's interest in
the Separate Account in the amount of .00041% (.15% per annum). (See
"Administration Fees," page 14.)
 
    Daily deductions will be made for mortality risks in the amount of .002192%
(.80% per annum) and for administrative expense risks in the amount of .001233%
(.45% per annum). (See "Mortality Risk and Administrative Expense Risk Charge,"
page 14.)
 
    A surrender charge (contingent deferred sales charge) may be deducted in the
event the Owner requests a full or partial surrender from the Separate Account.
The surrender charge is based on a graduated table of charges starting at 7% of
a Purchase Payment and amounts credited respecting such payment in the first
year from receipt and decreasing
 
                                        4
<PAGE>   8
 
1% per year so that no charge is made with respect to a Purchase Payment and
amounts credited thereon which was received seven or more years before the
surrender. No charge will be made for that part of the first surrender in a
Contract Year that does not exceed 10% of the Owner's interest in the Separate
Account and 10% of his or her interest in the General Account. (See "Surrender
Charges," page 13.)
 
    Premium taxes payable to any state or other governmental agency with respect
to the Owner's Account may be deducted on or after the date they were incurred.
Premium taxes currently range from 0% to 2.35% (3.50% in Nevada). Until further
notice, Security First Life will deduct premium taxes upon annuitization. (See
"Premium Taxes," page 13.)
 
   
FREE LOOK PERIOD
    
 
   
    At any time within ten days (or such longer period as required by state law)
after the receipt of the Contract it may be returned for cancellation and a full
refund of all Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. (See "Free Look Period," page 14).
    
 
VARIABLE ANNUITY PAYMENTS
 
    Monthly Annuity payments will start on the Annuity Date. The Owner selects
the Annuity Date, an Annuity payment option, and an assumed investment return.
Any of these selections may be changed prior to the Annuity Date. The Variable
Annuity payment will vary annually based on a comparison of the assumed
investment returns with the investment experience of the Series in which the
Contract Value is invested. (See "Variable Annuity Payments," page 17.)
 
    If Annuity payments from any one Series would be less than $50, Security
First Life reserves the right to change the frequency of the payments from that
Series to such intervals as will result in payments of at least $50 from each
Series. (See "Frequency of Payment," page 18.)
 
SURRENDER
 
    An Owner may surrender, before the Annuity Date, all or part of his or her
Contract Value. However, no partial surrender is permitted if it would reduce
the Owner's interest in any Series or the General Account to less than $500,
unless the entire amount allocated to that Series or the General Account is
being surrendered. A surrender charge may be assessed. (See "Surrender Charges,"
page 13.) In addition, the earnings surrendered will be taxed as ordinary income
and may be subject to a penalty tax under the Code. (See "Federal Income Tax
Status," page 20.) Certain restrictions are applicable to surrender from
Contracts funding retirement plans qualified for special tax treatment under the
Code. (See "Qualified Contracts," page 20.)
 
DEATH BENEFIT
 
    Unless otherwise restricted, in the event of the Owner's death prior to the
Annuity Date, the designated Beneficiary may elect either to receive a death
benefit in a lump sum or to apply the death benefit under certain of the
available optional Annuity forms contained in the Contract. The death benefit is
the greater of: (i) Purchase Payments reduced by amounts applied to partial
withdrawals or annuity income; (ii) the Contract Value at settlement or (iii) if
the Contract is issued on or before the date the Owner attains age 70, the
greater of the Contract Value on the seventh anniversary of the Contract Date or
each fifth anniversary thereafter, in each case reduced by amounts subsequently
applied to partial withdrawals or annuity income (see "Death Benefits," page
19).
 
                                        5
<PAGE>   9
 
                                   FEE TABLES
 
                        PARTICIPANT TRANSACTION EXPENSES
 
<TABLE>
<CAPTION>
                                                   Years       Percentage
                                                ------------  ------------
              <S>                               <C>           <C>
              Deferred Sales Charge (as a
                percentage                      less than 1        7%
              of amounts accumulated with
                respect to                      1 but not 2        6%
              a purchase payment)               2 but not 3        5%
                                                3 but not 4        4%
                                                4 but not 5        3%
                                                5 but not 6        2%
                                                6 but not 7        1%
                                                7 or more          0%
</TABLE>
 
                           SEPARATE ACCOUNT EXPENSES
                   (AS A PERCENTAGE OF AVERAGE ACCOUNT VALUE.
                   DEDUCTED DAILY FROM THE SEPARATE ACCOUNT.)
          Administration Fee                            .15% per annum
          Mortality and Expense Risk Fees              1.25% per annum
          Total Separate Account Annual Expenses       1.40% per annum
 
                              FUND ANNUAL EXPENSES
                    (AS A PERCENTAGE OF AVERAGE NET ASSETS)
                            (NET OF REIMBURSEMENT)2
 
   
<TABLE>
<CAPTION>
                                                                                                           Small
                             Money Market    Equity-Income     Growth     Overseas    Asset Manager    Capitalization
                               Portfolio       Portfolio     Portfolio    Portfolio     Portfolio        Portfolio
                             -------------   -------------   ----------   ---------   --------------   -------------
<S>                          <C>             <C>             <C>          <C>         <C>              <C>
(a) Management Fee.........      0.24%           0.51%          0.61%       0.76%          0.71%           0.85%
(b) Other Expenses.........      0.09%           0.10%          0.09%       0.15%          0.08%           0.07%
(c) Total Annual
  Expenses.................      0.33%           0.61%          0.70%       0.91%          0.79%           0.92%
</TABLE>
    
 
   
<TABLE>
<CAPTION>
                                                               Virtus      T. Rowe       T. Rowe
                                                             U.S. Govt.     Price         Price
                              Contrafund       Index 500       Income       Bond         Growth &
                               Portfolio      Portfolio*       Series      Series     Income Series
                             -------------   -------------   ----------   ---------   --------------
<S>                          <C>             <C>             <C>          <C>         <C>              <C>
(a) Management Fee.........      0.61%           0.09%          0.22%       0.50%          0.50%
(b) Other Expenses.........      0.11%           0.19%          0.48%       0.79%          0.24%
(c) Total Annual
  Expenses.................      0.72%           0.28%          0.70%       1.29%          0.74%
</TABLE>
    
 
- --------------------------------------------------------------------------------
  * Effective August 27, 1992 (commencement of operations), the Portfolio's
    investment advisor voluntarily agreed to limit expenses to .28% of average
    net assets.
 
                                        6
<PAGE>   10
 
EXAMPLES
 
   
<TABLE>
<CAPTION>
                                    CONDITIONS
   SEPARATE     A PARTICIPANT WOULD PAY THE FOLLOWING EXPENSES ON A                TIME PERIODS
    ACCOUNT       $1,000 INVESTMENT ASSUMING 5% ANNUAL RETURN ON        ----------------------------------
    SERIES                            ASSETS:                           1 YEAR  3 YEARS  5 YEARS  10 YEARS
- --------------- ---------------------------------------------------     ------  -------  -------  --------
<S>             <C>                                                 <C> <C>     <C>      <C>      <C>
Money Market    (a) upon surrender at the end of the stated time    (a)  $ 90    $ 109    $ 128     $201
Portfolio           period
                (b) if the Certificate WAS NOT surrendered          (b)    17       54       92      201
- --------------- --------------------------------------------------- ----------  -------  -------  --------
Equity Income   SAME                                                (a)    92      117      141      230
Portfolio
                                                                    (b)    20       62      107      230
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Growth          SAME                                                (a)    93      119      146      240
Portfolio
                                                                    (b)    21       65      111      240
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Overseas        SAME                                                (a)    95      125      156      261
Portfolio
                                                                    (b)    23       71      122      261
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Asset Manager   SAME                                                (a)    94      122      150      249
Portfolio
                                                                    (b)    22       68      116      249
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Contrafund      SAME                                                (a)    93      120      147      242
Portfolio
                                                                    (b)    21       65      112      242
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Index 500       SAME                                                (a)    89      107      125      195
Portfolio
                                                                    (b)    17       52       90      195
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Virtus U.S.     SAME                                                (a)    93      119      146      240
Govt. Income
Series
                                                                    (b)    21       65      111      240
- --------------- ---------------------------------------------------     ------  -------  -------  --------
T. Rowe Price   SAME                                                (a)    99      136      174      299
  Bond
Series
                                                                    (b)    27       83      141      299
- --------------- ---------------------------------------------------     ------  -------  -------  --------
T. Rowe Price   SAME                                                (a)    93      120      148      244
  Growth &
Income Series
                                                                    (b)    21       66      113      244
- --------------- ---------------------------------------------------     ------  -------  -------  --------
Small           SAME                                                (a)    95      126      157      262
Capitalization
Portfolio
                                                                    (b)    23       71      122      262
- --------------- ---------------------------------------------------     ------  -------  -------  --------
</TABLE>
    
 
                     EXPLANATION OF FEE TABLE AND EXAMPLES
 
1. The purpose of the foregoing tables and examples is to assist the Owner in
   understanding the various costs and expenses that he or she will bear
   directly or indirectly. The table reflects expenses of the Separate Account
   as well as the underlying Funds. For additional information see "Contract
   Charges," beginning on page 13.
 
                                        7
<PAGE>   11
 
   
2. The investment advisers to the Index 500 Portfolio and the U.S. Government
   Income Series voluntarily reimbursed certain expenses of these Funds. If
   there had been no reimbursement, total expenses would have been 0.81% and
   1.49%, respectively. (See the Variable Insurance Products Fund II and
   Security First Trust prospectuses for more information).
    
 
3. Premium taxes are not reflected. Presently, premium taxes ranging from 0% to
   2.35% (3.50% in Nevada) may be deducted from each Purchase Payment or upon
   annuitization. However, Security First Life presently deducts premium tax
   only from amounts annuitized.
 
4. NEITHER THE TABLE NOR THE EXAMPLES ARE REPRESENTATIONS OF PAST OR FUTURE
   EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
 
                                        8
<PAGE>   12
 
                        CONDENSED FINANCIAL INFORMATION
 
   
    The following table sets forth condensed financial information on
Accumulation Units respecting contracts issued under this prospectus through the
Separate Account. The information is derived from the financial statements of
the Separate Account which have been audited by Ernst & Young LLP, the Separate
Account's independent auditors. The information should be read in conjunction
with the financial statements, related notes and other financial information in
the Statement of Additional Information.
    
 
   
<TABLE>
<CAPTION>
                                   Seven   Twelve   Twelve   Twelve   Twelve   Twelve    Twelve      Five      Twelve    Twelve
                                  Months   Months   Months   Months   Months   Months    Months     Months     Months    Months
                                   Ended    Ended    Ended    Ended    Ended    Ended     Ended      Ended     Ended      Ended
     Separate Account Series      7/31/87  7/31/88  7/31/89  7/31/90  7/31/91  7/31/92   7/31/93   12/31/93   12/31/94  12/31/95
- --------------------------------- -------  -------  -------  -------  -------  -------  ---------  ---------  --------  ---------
<S>                               <C>      <C>      <C>      <C>      <C>      <C>      <C>        <C>        <C>       <C>
Series B (T. Rowe Price Bond
 Series)
 Beg. AUV $......................   5.00     4.97     5.21     5.77     5.90     6.27        7.07       7.66     7.78       7.42
 End. AUV $......................   4.97     5.21     5.77     5.90     6.27     7.07        7.66       7.78     7.42       8.55
 End. No. Non-Qualified AUs......  4,018    8,795   14,195   35,914   29,408   34,855      45,488     45,035   35,534     45,117
 End. No. Qualified AUs..........     --   33,998   60,665   129,756  167,461  165,862    227,551    255,421   52,134     61,437
Series G (T. Rowe Price Growth
 and Income Series)
 Beg. AUV $......................   5.00     5.57     5.23     6.96     6.26     6.84        7.70       8.27     8.70       8.85
 End. AUV $......................   5.57     5.23     6.96     6.26     6.84     7.70        8.27       8.70     8.85      11.46
 End. No. Non-Qualified AUs...... 60,785   91,611   122,310  152,193  103,701  121,098    157,339    170,454  179,634    219,556
 End. No. Qualified AUs.......... 10,688   21,057   120,735  396,570  598,731  826,262  1,300,789  1,510,626  265,635    318,557
Series FA (Asset Manager)
 Beg. AUV $ (5/13/93)............                                                            5.00       5.15     5.62       5.21
 End. AUV $......................                                                            5.15       5.62     5.21       6.02
 End. No. Non-Qualified AUs......                                                          14,874    297,065  639,669    636,600
 End. No. Qualified AUs..........                                                          14,679    233,747  881,502   1,048,666
Series FG (Growth Portfolio)
 Beg. AUV $ (5/24/93)............                                                            5.00       5.06     5.40       5.33
 End. AUV $......................                                                            5.06       5.40     5.33       7.13
 End. No. Non-Qualified AUs......                                                           6,333     68,333  220,859    369,778
 End. No. Qualified AUs..........                                                           6,703     69,326  351,616    691,102
Series FI (Index 500 Portfolio)
 Beg. AUV $ (6/30/93)............                                                            5.00       4.97     5.20       5.19
 End. AUV $......................                                                            4.97       5.20     5.19       7.04
 End. No. Non-Qualified AUs......                                                              --      9,764   31,543     73,445
 End. No. Qualified AUs..........                                                           2,334      8,392   30,822    120,370
Series FO (Overseas Portfolio)
 Beg. AUV $ (5/24/93)............                                                            5.00       5.12     5.64       5.67
 End. AUV $......................                                                            5.12       5.64     5.67       6.14
 End. No. Non-Qualified AUs......                                                              --     11,178   82,312     71,276
 End. No. Qualified AUs..........                                                             491      8,248  107,910    146,405
Series FM (Money Market
 Portfolio)
 Beg. AUV $ (1/1/94).............                                                                                5.00       5.16
 End. AUV $......................                                                                                5.16       5.40
 End. No. Non-Qualified AUs......                                                                              47,324    177,174
 End. No. Qualified AUs..........                                                                               9,656    326,232
 Yield...........................                                                                               4.45%      3.95%
Series FE (Equity-Income
 Portfolio)
 Beg. AUV $ (5/25/95)............                                                                                           5.00
 End. AUV $......................                                                                                           6.13
 End No. Non-Qualified AUs.......                                                                                         48,543
 End No. Qualified AUs...........                                                                                         82,578
Series FC (Contrafund Portfolio)
 Beg. AUV $ (5/16/95)............                                                                                           5.00
 End. AUV $......................                                                                                           6.29
 End. No. Non-Qualified AUs......                                                                                         98,145
 End. No. Qualified AUs..........                                                                                        143,884
Series Su (Virtus U.S. Govt.
 Income Series)
 Beg. AUV $ (5/25/95)............                                                                                           5.00
 End. AUV $......................                                                                                           5.43
 End. No. Non-Qualified AUs......                                                                                          8,806
 End. No. Qualified AUs..........                                                                                         10,909
Series AS (Small Cap. Portfolio)
 Beg. AUV $ (5/22/95)............                                                                                           5.00
 End. AUV $......................                                                                                           6.54
 End. No. Non-Qualified AUs......                                                                                        115,588
 End. No. Qualified AUs..........                                                                                        160,410
</TABLE>
    
 
- ---------------
 
AUV -- Accumulation Unit Value
AUs  -- Accumulation Units
 
                                        9
<PAGE>   13
 
                                  PERFORMANCE
 
   
    Security First Life may from time to time advertise the yield and effective
yield on the Series invested in the Money Market Portfolio of the Separate
Account and the average annual total returns for the other Series of the
Separate Account. Yields and average annual total returns are determined in
accordance with the methods of computation set forth by the SEC in the Form N-4
Registration Statement and are more particularly described in the Statement of
Additional Information. Yields are expressed for a seven day period, and average
annual total returns are expressed for at least one, five and ten year periods
(or from inception if shorter).
    
 
   
    The yields of the Series invested in the Money Market Portfolio are
determined based upon the change in the value of an outstanding unit in the
Separate Account over a seven day period and annualizing the result. The
computation takes into account recurring deductions from account values, but no
deduction is made for surrender charges which may apply upon a full or partial
surrender. These charges are described in "Surrender Charges," page 13. In the
event of a surrender of the Contract, the imposition of surrender charges will
have the effect of reducing the yield earned over the period of ownership.
    
 
    The computation of average annual total returns do take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.
 
                             FINANCIAL INFORMATION
 
    Financial Statements of the Separate Account and Security First Life are
contained in the Statement of Additional Information.
 
             DESCRIPTION OF SECURITY FIRST LIFE INSURANCE COMPANY,
            THE GENERAL ACCOUNT, THE SEPARATE ACCOUNT AND THE FUNDS
 
THE INSURANCE COMPANY
 
   
    Security First Life is a stock life insurance company founded in 1960 and
organized under the laws of the State of Delaware. Its principal executive
offices are located at 11365 West Olympic Boulevard, Los Angeles, California
90064. Security First Life owns all of the outstanding stock of Fidelity
Standard Life Insurance Company. Security First Life is a wholly-owned
subsidiary of Security First Group, Inc. ("SFG") (formerly The Holden Group,
Inc.). The outstanding voting stock of SFG is owned by London Insurance Group,
Inc., a Canadian insurance service corporation and publicly traded subsidiary of
the Trilon Corporation of Toronto, Canada. Trilon Financial controls several
major Canadian corporations including London Life Insurance Company. Security
First Life is authorized to transact the business of life insurance, including
annuities. Security First Life presently is licensed to do business in 49 states
and the District of Columbia.
    
 
THE GENERAL ACCOUNT
 
    The General Account is made up of all the assets of Security First Life,
other than those in the Separate Account and other segregated asset accounts.
The Owner may allocate amounts to the General Account at the time of purchase or
by subsequent transfers from the Separate Account. Amounts allocated to the
General Account will be credited with interest on the basis of interest rates
guaranteed or declared by Security First Life under the terms of the Contract.
Instead of the Owner bearing the risk of fluctuations in the value of the assets
as is the case for amounts invested in the Separate Account, Security First Life
bears the full investment risk for amounts in the General Account. Security
First Life has sole discretion to invest the assets of the General Account,
subject to applicable law. The General Account provisions of the Contract are
not intended to be offered by this Prospectus. Contract Owners are referred to
the terms of the Contract itself for more information concerning these
provisions.
 
THE SEPARATE ACCOUNT
 
    The Separate Account was established by Security First Life on May 29, 1980,
in accordance with the provisions of the Delaware Insurance Code. It is
registered as a unit investment trust under the 1940 Act. Registration with the
SEC does not involve supervision by the SEC of the management or investment
practices or policies of the Separate Account or Security First Life.
 
    The Separate Account and each Series therein are administered and accounted
for as part of the general business of Security First Life, but the income and
realized capital gains or losses of each Series are credited to or charged
against the assets held for that Series in accordance with the terms of the
Contracts. This is done without regard to the income, realized capital gains or
losses of any other Series or the experience of Security First Life in any other
business
 
                                       10
<PAGE>   14
 
it may conduct. The assets within each Series are not chargeable with
liabilities incurred by any other Series, or arising out of any other business
Security First Life may conduct.
 
    All obligations arising under the Contracts, including the guarantee to make
annuity payments, are general corporate obligations of Security First Life, and
all of Security First Life's assets are available to meet its expenses and
obligations under the Contracts. However, while Security First Life is obligated
to make the Variable Annuity payments under the Contracts, the amount of such
payments is guaranteed only to the extent of the level amount calculated at the
beginning of each Annuity year. (See "Level Payments Varying Annually," page
18.)
 
   
    The Separate Account is divided into a number of Series of Accumulation and
Annuity Units, eleven of which are available under the Contracts, and each
Series invests in the shares of only one of the Funds. The Funds consist of (i)
the Money Market Portfolio, Equity-Income Portfolio, Growth Portfolio and
Overseas Portfolio of the Variable Insurance Products Fund, (ii) the Asset
Manager Portfolio, Contrafund Portfolio and Index 500 Portfolio of the Variable
Insurance Products Fund II, (iii) the Virtus U.S. Government Income Series, T.
Rowe Price Bond Series and T. Rowe Price Growth and Income Series of the
Security First Trust and (iv) the Small Capitalization Portfolio of The Alger
American Fund. The shares of each Fund are purchased, without sales charge, for
the corresponding Series at the net asset value per share next determined by
each Fund following receipt of the applicable payment. Any dividend or capital
gain distributions received from a Fund are reinvested in Fund shares which are
retained as assets of the applicable Series. Fund shares will be redeemed
without fee to the Series to the extent necessary for Security First Life to
make Annuity or other payments under the Contracts.
    
 
    If shares of any Fund should no longer be available for investment by a
Series or if in the judgment of Security First Life's management further
investment in the shares of any fund should become inappropriate in view of the
purposes of the Contracts issued, Security First Life may substitute for the
Fund shares already purchased, and apply future Purchase Payments under the
Contracts to the purchase of shares of another Fund or other securities. No
substitution of securities of any Series may take place, however, without a
prior favorable vote of a majority of the Owners entitled to vote who have
invested in the Series and the prior approval of the SEC.
 
THE FUNDS
 
    Each of the Funds is a portfolio or series of an open-end management
investment company registered with the SEC under the 1940 Act. Registration does
not involve supervision by the SEC of the investments or investment policies of
the Funds. There can be no assurance that the investment objectives of the Funds
will be achieved.
 
    Variable Insurance Products Fund and Variable Insurance Products Fund II are
Massachusetts business trusts. Each is divided into separate portfolios. The
following portfolios from these trusts are available under the Contracts:
 
    Money Market Portfolio seeks to obtain as high a level of current income as
is consistent with preserving capital and providing liquidity. The portfolio
will invest only in high quality U.S. dollar denominated money market securities
of domestic and foreign issuers.
 
    Equity-Income Portfolio seeks reasonable income by investing primarily in
income-producing equity securities. In choosing these securities, the Fund 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 500 Composite Stock Price Index.
 
   
    Growth Portfolio seeks to achieve capital appreciation normally through the
purchase of common stocks (although the portfolio's investments are not
restricted to any one type of security). Capital appreciation may also be found
in other types of securities, including bonds and preferred stocks.
    
 
    Overseas Portfolio seeks long-term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.
 
    Asset Manager Portfolio seeks high total return with reduced risk over the
long-term by allocating its assets among stocks, bonds and short-term, fixed
income instruments.
 
    Contrafund Portfolio seeks capital appreciation by investing in companies
that the investment adviser believes to be undervalued due to an overly
pessimistic appraisal by the public.
 
                                       11
<PAGE>   15
 
    Index 500 Portfolio seeks investment results that correspond to the total
return (i.e., the combination of capital changes and income) of common stocks
publicly traded in the United States, as represented by the Standard & Poor's
500 Composite Stock Price Index while keeping transaction costs and other
expenses low.
 
    FMR is the investment adviser to each of the portfolios of the Variable
Insurance Products Fund and the Variable Insurance Products Fund II.
 
    The Security First Trust is a Massachusetts business trust which has a
number of series, three of which are available under the Contracts:
 
   
    Virtus U.S. Government Income Series (formerly U.S. Government Income
Series) seeks to provide current income. The Series pursues this objective by
investing in a professionally managed, diversified portfolio limited primarily
to U.S. government securities.
    
 
   
    T. Rowe Price Bond Series (formerly Bond Series) seeks to achieve the
highest investment income over the long-term consistent with the preservation of
principal through investment primarily in marketable debt instruments. Growth of
principal and income will also be objectives with respect to up to 10% of the T.
Rowe Price Bond Series' assets which may be invested in common and preferred
stocks.
    
 
   
    T. Rowe Price Growth and Income Series (formerly Growth and Income Series)
seeks capital growth and a reasonable level of current income. While this series
will generally invest in common stocks and other equities, it may, depending on
economic conditions, reduce such investments and substitute fixed income
instruments.
    
 
   
    Security Management, a subsidiary of SFG and an affiliate of Security First
Life and Security First Financial, Inc., provides investment advice and
management services to the three series of Security First Trust described above.
Under subadvisory agreements with Security Management, Price Associates provides
investment management services to the T. Rowe Price Bond and T. Rowe Price
Growth and Income Series and Virtus provides investment management services to
the Virtus U.S. Government Income Series.
    
 
    The Alger American Fund is a Massachusetts business trust which has a number
of portfolios, one of which is available under the Contracts.
 
    Small Capitalization Portfolio seeks long-term capital appreciation by
investing in a diversified, actively managed portfolio of equity securities,
primarily of companies with total market capitalization of less than $1 billion.
Income is a consideration in the selection of investments but is not an
investment objective of the Portfolio.
 
    The investment adviser of The Alger American Fund is Alger Management.
 
    The Funds are available to registered separate accounts offering variable
annuity and variable life products of participating insurance companies and to
other entities permitted under Section 817(h) of the Code. Although it is not
anticipated that any disadvantage will result, there is a possibility that a
material conflict may arise between the interest of the Separate Account and one
or more of the other separate accounts participating in the Funds. A conflict
may occur due to a change in law affecting the operations of variable life and
variable annuity separate accounts, differences in the voting instructions of
our Owners and those of other companies, or some other reason. In the event of a
conflict, the Separate Account will take any steps necessary to protect Owners
and variable annuity payees, which may include withdrawal of amounts invested in
the Fund by the Separate Account.
 
    The rights of Participants or Beneficiaries to instruct Security First Life
on voting shares of the Funds are described under "Voting Rights," page 22.
 
    Detailed information about the Funds, their investment objectives,
investment portfolios and the charges may be found in the prospectuses of the
Funds. An investor should carefully read the Funds' prospectuses before
investing. Prospectuses for Variable Insurance Products Fund, Variable Insurance
Products Fund II, Security First Trust and The Alger American Fund may be
obtained without charge by written request to Security First Life Insurance
Company, P.O. Box 92193, Los Angeles, California 90009.
 
                             PRINCIPAL UNDERWRITER
 
   
    Security First Financial, Inc., 11365 West Olympic Boulevard, Los Angeles,
California 90064, a broker-dealer registered under the Securities Exchange Act
of 1934 and a member of the National Association of Securities Dealers, Inc., is
the principal underwriter for the Contracts. Security First Financial, Inc. is a
Delaware corporation and a subsidiary of SFG.
    
 
                                       12
<PAGE>   16
 
                                SERVICING AGENT
 
   
    Security First Life receives certain administrative services such as office
space, supplies, utilities, office equipment, travel expenses and periodic
reports pursuant to an agreement with SFG.
    
 
                             CUSTODY OF SECURITIES
 
    The custodian of the assets of the Separate Account is Security First Life.
The assets of each Series will be kept physically segregated by Security First
Life and held separate from the assets of the other Series and of any other
firm, person, or corporation. Additional protection for the assets of the
Separate Account is afforded by fidelity bonds covering all of Security First
Life's officers and employees.
 
                                CONTRACT CHARGES
 
   
    Contract charges are assessed as follows: (i) for premium taxes; (ii) on
certain surrenders; (iii) against the value of the assets in the Separate
Account on a daily basis for administration of the Contract; and (iv) against
the value of the assets of the Separate Account on a daily basis for the
assumption of mortality risks and for administrative expenses risks. These
charges may not be changed under the Contract, and Security First Life may
profit from these charges in the aggregate.
    
 
    An investor should note that there are deductions from and expenses paid out
of the assets of the Funds that are described in their respective prospectuses.
 
PREMIUM TAXES
 
    Certain state and governmental entities impose a premium tax of up to 2.35%
(3.50% in Nevada) of Purchase Payments or amounts applied to an Annuity option.
The Contracts permit Security First Life to deduct any applicable premium taxes
from the Contract Value at or after the time they are incurred. Until further
notice, Security First Life will deduct any premium tax only from amounts
applied to an Annuity option.
 
SURRENDER CHARGES
 
    No sales charge is deducted from any Purchase Payment. However, a surrender
charge (contingent deferred sales charge) may be assessed whenever a partial or
full surrender of the Contract Value is made. The surrender charge covers
expenses relating to the sale of the Contract, including commissions paid to
sales personnel and other promotion and acquisition expenses.
 
    Up to 10% of the Contract Value in each of the Separate Account and General
Account received in the first surrender in the Contract Year will not be subject
to a surrender charge ("Free Withdrawal Amount"). Amounts surrendered in excess
of the Free Withdrawal Amount may be subject to a surrender charge.
 
    The amount credited to the Owner's Account with respect to each Purchase
Payment will be subject to a charge equal to the applicable percentage of such
amount at the time a full or partial surrender is made.
 
<TABLE>
<CAPTION>
 ELAPSED TIME SINCE PURCHASE
     PAYMENT WAS RECEIVED         APPLICABLE PERCENTAGE
- ------------------------------    ----------------------
<S>                               <C>
Less than one year                          7%
1 year but less than 2 years                6%
2 years but less than 3 years               5%
3 years but less than 4 years               4%
4 years but less than 5 years               3%
5 years but less than 6 years               2%
6 years but less than 7 years               1%
7 years or more                             0%
</TABLE>
 
   
    These charges are applied by reducing the Series or General Account from
which the surrender will be taken by an amount determined by dividing the amount
elected to be surrendered by a factor derived from the above percentage charges.
This factor is equivalent to (a)-(b) where (a) is 1 and (b) is the percentage
charge expressed as a decimal. Accumulation Units are cancelled on a first-in,
first-out basis. In no event will surrender charges
    
 
                                       13
<PAGE>   17
 
imposed on Accumulation Units exceed an amount equal to 9% of Purchase Payments
allocated to the Separate Account. The effect of this varying schedule of
percentage charges is that amounts left in the Separate Account for longer
periods of time are subject to lower charges than amounts immediately
surrendered.
 
    In the event of a partial surrender, the Owner will receive a check in the
amount requested. Surrender charges, if any, will be deducted from the Series
from which the partial surrender was taken, or proportionally from the remaining
Series in the event that a Series is fully surrendered.
 
    Surrender charges will be waived on a lump sum withdrawal if the Owner is
confined to a hospital for a minimum of 30 consecutive days or a skilled nursing
home for a minimum of 90 consecutive days and the withdrawal is requested within
60 days after termination of confinement. Surrender charges will be eliminated
when the Contracts are issued to officers, directors or full time employees of
Security First Life or its affiliates. Contracts so purchased are purchased for
investment purposes only.
 
ADMINISTRATION FEES
 
    An administration fee of .00041% (.15% per annum) is deducted from the
Owner's interest in the Separate Account on a daily basis. Contract
administration expenses include the cost of policy issuance; salaries; rent;
postage; telephone and travel expenses; legal, administrative, actuarial and
accounting fees; periodic reports; office equipment; stationery; office space;
and custodial expenses. These fees will not exceed the cost of providing such
administration services.
 
MORTALITY RISK AND ADMINISTRATIVE EXPENSE RISK CHARGE
 
    The minimum death benefit provided for by the Contracts requires Security
First Life to assume a mortality risk that the Contract Value will be less than
the Owner's Purchase Payments adjusted for prior withdrawals and/or amounts
applied to Annuity options. (See "Death Before the Annuity Date," page 20.) In
addition, because the Contracts provide life Annuity options, Security First
Life assumes a mortality risk that the death rate of Annuitants as a group will
be lower than the death rate upon which the mortality tables specified in the
Contracts are based. A fee will be charged by Security First Life to compensate
it for assuming these mortality risks in connection with amounts allocated to
the Separate Account. Security First Life will make a daily deduction from the
Separate Account for mortality risks equal to .80% on an annual basis of the
Separate Account assets funding the Contracts.
 
    Although Security First Life charges an administration fee equal to 0.15%
per annum from the value of Separate Account assets funding the Contract, there
is no assurance that these fees will be sufficient to absorb the administrative
expenses incurred by Security First Life during the term of the Contract. As
compensation for assuming the risk that the administrative expenses will exceed
such fees, Security First Life will make a daily deduction from the value of the
Separate Account assets funding the Contracts equal to .45% on an annual basis.
 
    If Security First Life has gains from the receipt of the mortality and
expense risk charges over its costs of assuming these risks under the Contracts,
it may use the gains in its discretion, including reduction of expenses incurred
in distributing the Contracts.
 
    Security First Life may, in its discretion, voluntarily waive a portion of
the mortality and administrative expense risk charges, which waiver may be
terminated at any time.
 
   
FREE LOOK PERIOD
    
 
   
    The Contract provides for an initial "Free Look" period. The Owner has the
right to return the Contract within 10 days (or such longer period as required
by state law) after the Owner receives the Contract by delivering or mailing it
to Security First Life at its administrative office. If the Contract is mailed,
it will be deemed mailed on the date of the postmark or, if sent by certified or
registered mail, the date of certification or registration. The returned
Contract will be treated as if the Company never issued it, and the Company will
refund the Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. Effective on and after June 1, 1996,
Purchase Payments contributed to the Separate Account will be allocated to the
Money Market Portfolio for the number of days of the Free Look period required
by the state. At the end of the Free Look period, the account value in the Money
Market Portfolio will be reallocated to the series of the Separate Account
selected in the application.
    
 
                                       14
<PAGE>   18
 
                          DESCRIPTION OF THE CONTRACTS
 
ASSIGNMENT
 
    The Contracts provide that an Owner may freely assign his or her rights
under them. However, the Code provides that Contracts issued in connection with
Section 401 or 403 plans and IRAs must be nontransferable and nonassignable.
 
PURCHASE PAYMENTS
 
    Purchase Payments may be made at any time. The minimum initial Purchase
Payment is $1,000; with each additional Purchase Payment subject to a $100
minimum ($500 initial purchase payment and $100 additional payment for IRA's).
Confirmation of each Purchase Payment received will be sent to the Owner.
 
CONVERSIONS
 
    Accumulation Units may be converted among the Series or to the General
Account at any time. No conversion from the General Account to Accumulation
Units is permitted, except pursuant to a reallocation election. Conversion
instructions may be communicated in writing or, if permitted by Security First
Life, by telephone. If telephone conversions of Accumulation Units are
permitted, the Owner will be required to complete an authorization on the
Contract application or on another form provided by Security First Life.
Security First Life will employ reasonable procedures to confirm that telephone
instructions are genuine (including requiring one or more forms of personal
identification), and Security First Life will not be liable for following
instructions it reasonably believes to be genuine.
 
   
    Accumulation Units will be converted on the first valuation after receipt of
written or telephone instructions. Because Accumulation Unit values are
determined at the close of trading on the New York Stock Exchange (currently
4:00 P.M. Eastern Time) on a Valuation Date, conversion instructions received up
to that time will be effected at the value calculated on that Date and
instructions received after that time will be effected at the value next
calculated.
    
 
    Annuity Units may be converted among the Series at any time. Annuity Units
may not be converted to the General Account. However, amounts in the General
Account that have not been applied to a Fixed Annuity income option may be
converted to Annuity Units in one or more Series for a variable payout.
Conversions described in this paragraph may be elected in writing only and will
be effective on the first valuation following receipt of the instructions.
 
    Except as permitted under a reallocation election or a dollar cost averaging
program, a minimum of $500 must be converted from any Series or from the General
Account. The value of the Accumulation and Annuity Units converted will be
calculated as of the close of business on the day the conversion occurs.
 
DOLLAR COST AVERAGING
 
    Security First Life offers a program for dollar cost averaging in which
Owners with Contract Values of $5,000 or more may participate. The program will
periodically convert Accumulation Units from the Series invested in the Money
Market Portfolio of the Variable Insurance Products Fund to any of the other
Series selected by the Owner. The program allows the Owner to invest in
non-money market Series over any period selected by the Owner rather than
investing in those Series all at once. Conversions may be made monthly,
quarterly, semi-annually, or annually in a minimum amount of $100, and Security
First Life reserves the right to limit the number of Series to which conversions
can be made (but there are not current limitations). An Owner may terminate the
program at any time on written notice to Security First Life.
 
REALLOCATION ELECTION
 
    An Owner with a Contract Value of $5,000 or more may elect in writing on a
form provided by Security First Life to systematically reallocate values
invested in Accumulation Units among the Series and in the General Account in
order to achieve an allocation ratio established by the Owner. Conversions will
be made annually on the third business day of the month in which the anniversary
of the Contract Date occurs. No conversion from the General Account shall exceed
20% of the Owner's interest invested in the General Account. Changes in
allocation ratios can be made once each Contract Year.
 
                                       15
<PAGE>   19
 
MODIFICATION OF THE CONTRACTS
 
    The Contracts include Security First Life's assurance that Annuity payments
involving life contingencies will be based on the minimum guaranteed Annuity
purchase rates incorporated in the Contracts, regardless of actual mortality
experience. The Contracts include provisions legally binding on Security First
Life with respect to these Annuity purchase rates and such other matters as
death benefits, deductions from Purchase Payments, deductions from Contract
Values for transaction charges, deductions from the Separate Account for
actuarial risk and administrative expense risk fees, and guaranteed rates with
respect to fixed benefits. Security First Life may unilaterally change such
provisions, but only: (i) with respect to any Purchase Payments received as a
tax free exchange under the Code after the effective date of the change; (ii)
with respect to benefits and values provided by Purchase Payments made after the
effective date of the change to the extent that such Purchase Payments in any
Contract Year exceed the first year's Purchase Payments; or (iii) to the extent
necessary to conform the Contract to any Federal or state law, regulation or
ruling.
 
    Inquiries as to any Contract provisions should be made in writing to
Security First Life Insurance Company, P.O. Box 92193, Los Angeles, California
90009 or by telephoning 1(800)284-4536.
 
                              ACCUMULATION PERIOD
 
CREDITING ACCUMULATION UNITS IN THE SEPARATE ACCOUNT
 
    Accumulation Units are credited to a Series upon receipt of each Purchase
Payment or conversion, as the case may be. The number of Accumulation Units to
be credited is determined by dividing the net amount allocated to a Series by
the value of an Accumulation Unit in the Series next computed following receipt
of the Payment or conversion.
 
SEPARATE ACCOUNT ACCUMULATION UNIT CURRENT VALUES
 
   
    The current value of Accumulation Units of a Series varies with the
investment experience of the Fund in which the assets of the Series are
invested. Such value is determined each business day at the close of trading on
the New York Stock Exchange (currently 4:00 P.M. Eastern Time) by multiplying
the value of an Accumulation Unit in the Series on the immediately preceding
Valuation Date by the net investment factor for the period since that day. (See
"Net Investment Factor," page 16.) The Owner bears the investment risk that the
aggregate current value invested in the Series may at any time be less than,
equal to, or more than the amounts originally allocated to the Series.
    
 
NET INVESTMENT FACTOR
 
    The net investment factor is an index of the percentage change (adjusted for
distributions by the Fund and the deduction of the administration fees,
mortality risk fee and administrative expense risk fee) in the net asset value
of the Fund in which a Series is invested, since the preceding Valuation Date.
The net investment factor may be greater or less than one, depending upon the
Fund's investment performance.
 
SURRENDER FROM THE SEPARATE ACCOUNT
 
    An Owner may surrender all or a portion of his or her cash value at any time
prior to the Annuity Date. A surrender may result in adverse federal income tax
consequences to the Owner including current taxation of the distribution and a
penalty tax on a premature distribution. (See "Federal Income Tax Status," page
20.) Owners should consult their tax advisers before making withdrawals.
 
    The cash value of an Owner's interest in the Separate Account prior to the
Annuity Date may be determined at any time by multiplying the number of
Accumulation Units for each Series credited to the Contract by the current value
of an Accumulation Unit in the Series and subtracting the surrender charges, if
any. Upon receipt of a written request for a full or partial surrender, Security
First Life will determine the value of the number of Accumulation Units
withdrawn at the Accumulation Unit value next computed.
 
    A request for a partial surrender from more than one Series must specify the
allocation of the partial surrender among the Series. No partial surrender may
be made that would cause an Owner's interest in any Series to have a value after
the surrender of less than $500, unless the entire amount allocated to such
Series is being surrendered.
 
    Payment of any amount surrendered from the Series will be made within seven
days of the date the written request is received by Security First Life.
Surrenders may be suspended when: (i) trading on the New York Stock Exchange is
restricted by the SEC or such Exchange is closed for other than weekends or
holidays; (ii) the SEC has by order
 
                                       16
<PAGE>   20
 
permitted such suspension; or (iii) an emergency as determined by the SEC exists
making disposal of portfolio securities or valuation of assets of the Funds not
reasonably practicable.
 
STATEMENT OF ACCOUNT
 
    Prior to the Annuity Date, each Owner will be provided with a written
statement of account each calendar quarter in which a transaction occurred, but
in no event less than one annually. The statement of account will show all
transactions for the period being reported as well as the number of Accumulation
Units of each Series then credited to the Contract, the current Accumulation
Unit value for each Series, and the Contract Value as of the end of the
reporting period.
 
                                ANNUITY BENEFITS
 
VARIABLE ANNUITY PAYMENTS
 
    The Owner's interest in the Series will be applied to provide a Variable
Annuity. The dollar amount of Variable Annuity payments will reflect the
investment experience of the Series but will not be affected by adverse
mortality experience which may exceed the mortality risk charge provided for
under the Contract.
 
ASSUMED INVESTMENT RETURN
 
    Variable Annuity payments will vary from payments based on the Assumed
Investment Return depending on whether the investment experience of the Series
is better or worse than the assumed return. The choice of the Assumed Investment
Return affects the pattern of annuity payments. Over a period of time, if the
Separate Account achieved a net investment result equal to the Assumed
Investment Return applicable to a particular option, the Annuity Unit would not
change in value, and the amount of the Annuity payments would be level. However,
if the Separate Account achieved a net investment result greater than the
Assumed Investment Return, the Annuity Unit would increase in value and the
amount of the Annuity payments would increase in value each year. Similarly, if
the Separate Account achieved a net investment result smaller than the Assumed
Investment Return, the Annuity Unit would decrease in value and the amount of
the Annuity payments would decrease each year.
 
    Although a higher initial payment would be received under a higher Assumed
Investment Return, there is a point in time after which payments under a lower
Assumed Investment Return would be greater, assuming payments continue through
that point in time. The effect of a higher or lower Assumed Investment Return
can be summarized as follows: a higher Assumed Investment Return will result in
a larger initial payment but more slowly rising or more rapidly falling
subsequent payments than a lower Assumed Investment Return.
 
    Unless otherwise elected, the Assumed Investment Return will be 4.25% per
annum. To the extent permitted by state law and regulations, Security First Life
will permit election of an Assumed Investment Return of 3.50%, 5% or 6%. It
should not be inferred, however, that such returns will bear any relationship to
the actual net investment experience of the Series.
 
ELECTION OF ANNUITY DATE AND FORM OF ANNUITY
 
    The Annuity Date and the form of Annuity payment are elected by the Owner.
The normal Annuity Date is the Contract anniversary nearest to the Annuitant's
85th birthday, or the 10th anniversary of the Contract Date, whichever is later,
except in the case of Qualified Contracts, which may require a different date.
To the extent not prohibited by any Qualified Contract requirements, an optional
Annuity Date may be elected; such date may be the first day of any month prior
to the normal Annuity Date. The election must be made at least 31 days before
the optional Annuity Date elected.
 
    The normal form of Annuity payment under the Contracts is Option 2, a life
Annuity with 120 monthly payments certain. Unless indicated otherwise, Option 2
will be automatically applied. Changes in the optional form of Annuity payment
may be made at any time up to 31 days prior to the date on which Annuity
payments are to begin. Option 1 through 4 may be elected as either Variable
Annuities or Fixed Annuities, while Option 5 may be elected only as a Fixed
Annuity. The first year's Annuity payments described in Option 1 through 4 are
determined on the basis of (i) the mortality table specified in the Contract,
(ii) the age and, where permitted, the sex of the Annuitant, (iii) the type of
Annuity payment option(s) selected, and (iv) the Assumed Interest Return
selected. Fixed Annuity payments described in Option 5 are determined on the
basis of (i) the number of years in the payment period and (ii) the interest
rate guaranteed with respect to the option. Fixed Annuities are funded through
the General Account of Security First Life.
 
                                       17
<PAGE>   21
 
OPTION 1 -- LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual, ceasing
with the last payment due prior to the death of an individual. This option
offers the maximum level of monthly payments since there is no guarantee of a
minimum number of payments or of death benefits for Beneficiaries.
 
OPTION 2 -- LIFE ANNUITY WITH 120, 180 OR 240 MONTHLY PAYMENTS CERTAIN
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments not less than 120, 180 or 240
months, as elected. If at the death of the individual the specified number of
payments have not been made, Annuity payments will be continued during the
remainder of such period to the designated Beneficiary.
 
OPTION 3 -- INSTALLMENT REFUND LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments equal to the amount applied under
this option divided by the first monthly payment. If the payee dies before
receiving the "minimum number" of payments, the remaining payments will continue
to the designated beneficiary.
 
OPTION 4 -- JOINT AND LAST SURVIVOR ANNUITY
 
    An Annuity payable monthly during the joint lifetime of two individuals and
thereafter during the lifetime of the survivor, ceasing with the last payment
due prior to the death of the survivor.
 
OPTION 5 -- PAYMENTS FOR A DESIGNATED PERIOD
 
    A fixed dollar Annuity payable monthly for a specified number of years from
5 to 30. The amount of each payment will be based on an interest rate determined
by Security First Life, that will not be less than 3.50% per annum. Fixed
Annuity payments under this option may not be commuted to a lump sum, except as
provided under "Death Benefits," page 20.
 
FREQUENCY OF PAYMENT
 
    Payments under all options will be made on a monthly basis, unless a
different arrangement has been requested by the Owner and agreed to by Security
First Life. If at any time any payments to be made to any payee under any Series
are or become less than $50 each, Security First Life shall have the right to
decrease the frequency of payments to such intervals as will result in a payment
of at least $50 from each Series.
 
LEVEL PAYMENTS VARYING ANNUALLY
 
    Under the Contract, Variable Annuity payments are determined annually rather
than monthly, so that Annuity payments, uniform in amount, are made monthly
during each Annuity year. The level of payments for each year is based on the
investment performance of the Series up to the Valuation Date as of which the
payments are determined for the year. Thus, amounts of the Annuity payments vary
with the investment performance of the Series from year to year rather than from
month to month.
 
    The monthly Variable Annuity payments for the first year will be determined
on the last Valuation Date of the second calendar week preceding the Annuity
Date by using a formula described in the Contract. On each anniversary of the
Annuity Date, Security First Life will determine the total monthly payments for
the year then beginning. These will be determined by multiplying the number of
Annuity Units in each Series from which payments are to be made by the Annuity
Unit value of that Series for the Valuation Period in which the first payment
for that year is due.
 
    The amount of the year's Variable Annuity payments is transferred to the
General Account at the beginning of the year. Although an amount in the Separate
Account is credited to an Annuitant and transferred to the General Account to
make Annuity payments, it should not be inferred that the Annuitant has any
property rights in this amount. The Annuitant has only a contractual right to
Annuity payments from the amount credited to him or her in the Separate Account.
 
                                       18
<PAGE>   22
 
    The monthly Annuity payments for the year are made from the General Account
with interest credited, in effect, using the Assumed Investment Return of 4.25%
or the alternative Assumed Investment Return selected by the Owner. Security
First Life will experience profits or loss on the amounts placed in the General
Account to provide level monthly payments during the year to the extent that net
investment income and gains in the General Account exceed or are lower than the
Assumed Investment Return selected.
 
    Because Annuity payments for the year are set at the beginning of the year,
the Annuitant will not benefit from increases in Annuity Unit values during the
year and likewise will not be at risk for decreases during the year. However,
such increases and decreases will be reflected in the calculation of Annuity
payments for the subsequent year.
 
ANNUITY UNIT VALUES
 
    The value of an Annuity Unit at a Valuation Date is determined by
multiplying the value of the Annuity Unit at the preceding Valuation Date by an
"Annuity Change Factor." The Annuity Change Factor is an adjusted measurement of
the investment performance of the Fund since the end of the preceding Valuation
Period. The Annuity Change Factor is determined by dividing the value of the
Accumulation Unit at the Valuation Date by the value of the Accumulation Unit at
the preceding Valuation Date and multiplying the result by a neutralization
factor.
 
    The neutralization factor is determined by dividing 1 by the weekly
equivalent of the Assumed Investment Return previously selected by the
Annuitant. For example, the neutralization factor for the Assumed Investment
Return of 4.25% is 0.9991999.
 
    The number of Annuity Units for a Series is determined by dividing the
monthly Annuity payment for the first year by that Series' Annuity Unit value on
the same date the first year's Annuity payments are calculated. The number of
Annuity Units will not change unless the Owner converts Annuity Units to or from
other Series or amounts from the General Account.
 
                                 DEATH BENEFITS
 
DEATH BEFORE THE ANNUITY DATE
 
    In the event that the Annuitant who is not the Owner dies before the Annuity
Date, the Owner shall become the Annuitant. If the Owner dies before the Annuity
Date, whether or not he or she is the Annuitant, the Beneficiary will be
entitled to receive a death benefit. For purposes of determining the death of
the Owner, the death of any joint Owner shall be deemed to be the death of the
Owner. With respect to Nonqualified Contracts, if the Owner is not a natural
person and the Annuitant dies, the cash value will be paid in a lump sum to the
Owner or the Contract will be transferred to a natural person, in accordance
with the Owner's written request, and the transferee will become the Owner and
Annuitant.
 
    The death benefit shall be the greater of: (i) the Purchase Payments
received under the Contract, reduced by amounts already applied to produce
Annuity Income payments or for any prior partial surrenders; (ii) the Contract
Value at the time of settlement; or (iii) in the event the Contract is issued on
or before the date on which the oldest of the Owners attains age 70, the greater
of the Contract Value at the end of the seventh Contract Year or the Contract
Value at the end of each fifth Contract Year thereafter, in each case increased
by subsequent Purchase Payments received by Security First Life and reduced by
amounts subsequently applied to produce Annuity Income payments or to partial
surrenders.
 
   
    The Beneficiary may elect to receive the death benefit as either: (i)
Annuity Income under Annuity Income Options One, Two, or Five described in
Article 7 of the Contract, provided that an election of an Annuity Income Option
is subject to the following conditions: (a) payments must begin within one year
of the Owner's death (provided that under a Qualified Contract the spouse of the
Owner may delay commencement of payments to the date on which the Owner would
have attained age 70 1/2); (b) the guaranteed period under Option Two or the
designated period under Option Five may not be longer than the Beneficiary's
life expectancy under applicable tables specified by the Internal Revenue
Service; and (c) the Contract Value as of the date of the first Annuity Income
payment will be used to determine the amount of the death benefit to be applied;
or (ii) a lump sum payout, provided that this payout shall be made within five
(5) years of the date of death of the Owner.
    
 
    If the sole Beneficiary is the spouse of the Owner, the spouse may elect to
succeed to all rights of the Owner under this Contract. If there is more than
one Beneficiary living at the time of the Owner's death, each will share in the
proceeds of the death benefit equally, unless the Owner has elected otherwise.
If the Owner outlives all Beneficiaries,
 
                                       19
<PAGE>   23
 
the death benefit will be paid to the Owner's estate in a lump sum. No
Beneficiary shall have the right to assign, anticipate or commute any future
payments under any of the options, except as provided in the election or by law.
 
    Rights to the death benefit will pass as if the Owner outlived the
Beneficiary if: (i) the Beneficiary dies at the same time as the Owner; or (ii)
the Beneficiary dies within 15 days of the Owner's death and prior to the date
due proof of the Owner's death is received by Security First Life. Due proof of
death will be a certified death certificate, an attending physician's statement,
a decree of a court of competent jurisdiction as to the finding of death, or
such other documents as Security First Life may, at its option, accept.
 
DEATH AFTER THE ANNUITY DATE
 
    If the Annuitant under a Contract dies on or after the Annuity Date, the
remaining portion of his or her interest will be distributed at least as rapidly
as under the method of distribution being used at the date of the Annuitant's
death. If no designated Beneficiary survives the Annuitant, the present value of
any remaining payments certain on the date of death of the Annuitant, calculated
on the basis of the assumed investment return previously elected, may be paid in
one sum to the estate of the Annuitant unless other provisions have been made
and approved by Security First Life. This value is calculated as of the date of
payment following receipt of due proof of death.
 
    Unless otherwise restricted, a Beneficiary receiving variable payments under
Option 2 or 3 after the death of an Annuitant may elect at any time to receive
the present value of the remaining number of Annuity payments certain in a
single payment, calculated on the basis of the assumed investment return
previously selected. However, such election is not available to a Beneficiary
receiving Fixed Annuity payments.
 
                           FEDERAL INCOME TAX STATUS
 
    The operations of the Separate Account form part of the operations of
Security First Life, but the Code provides that no federal income tax will be
payable by Security First Life on the investment income and capital gains of the
Separate Account. No federal income tax is payable by the Owner on the
investment income and capital gains under a Contract until Annuity payments
commence or a full or partial withdrawal is made.
 
QUALIFIED CONTRACTS
 
    Under a section 401 pension plan, withdrawals may be made only in the event
of death, disability, separation from service, or attainment of normal
retirement age. Under Section 403(b) of the Code withdrawal prior to age 59 1/2
of amounts attributable to contributions and earnings made after December 31,
1988, are restricted in a manner similar to those under Section 401 pension
plans. However, under a 403(b) annuity, the Code permits withdrawals of the
contributed amounts (and not the earnings thereon) in cases of financial
hardship. The restrictions on withdrawals from Section 403(b) annuities do not
apply to Contract values attributable to Contract values before January 1, 1989.
In the case of Section 457 deferred compensation plan, benefits are not
permitted to be made available earlier than when the employee attains age
70 1/2, separates from service or is faced with an unforseeable emergency.
Withdrawals from an IRA can be made when the Owner attains age 59 1/2, dies or
becomes disabled.
 
    Generally, all withdrawals made prior to age 59 1/2 that are not a result of
death, disability, domestic relations order, deductible medical expense or
received as a series of substantially equal payments made for the life of the
Owner or the joint lives of the Owner and Owner's beneficiary will be subject to
an additional 10% tax. Distributions from a Section 457 plan are not subject to
this 10% penalty tax.
 
   
    In the case of section 401 plans and section 457 plans, the Contract Value
must be distributed, or Annuity payments for life or a period not exceeding the
life expectancy of the Participant or the Participant and a designated
Beneficiary must commence by April 1 of the calendar year following the calendar
year in which the employee attains age 70 1/2 (or retires in the case of
government plans and Section 457 Plans) or retires. If the Participant is the
Owner of an IRA, then the required distributions described above must be made or
commenced no later than the following April 1. The same distribution
requirements apply to 403(b) tax sheltered annuities with respect to benefits
accruing after December 31, 1986 in taxable years ending after that date.
    
 
    Providing certain requirements of the Code are met, distributions, other
than required distributions, from a plan may be rolled over tax-free to another
plan. Distributions from a section 401 plan may be rolled over to another
section 401 plan or to an IRA. Distributions from a tax-sheltered Annuity may be
rolled over to another tax-sheltered Annuity or to an IRA. Distributions from an
IRA may be rolled over to another IRA and, if the IRA contains only permissible
rollover amounts, to a section 401 plan or a tax-sheltered Annuity.
 
                                       20
<PAGE>   24
 
    All distributions, with the exception of a return of nondeductible employee
contributions, received from a section 401, 403(b), 457 plan or IRA are included
in gross income. In the case of section 401, or 403(b) plans and IRAs, a
distribution is includible in the year in which it is paid. In the case of a
section 457 plan, a distribution is includible in the year it is paid or when
made available depending upon whether certain Code requirements are met. In very
limited situations, a lump sum distribution from a section 401 plan may qualify
for special forward income averaging or may qualify for special long term
capital gain treatment.
 
    In addition to the minimum distribution requirements, any payouts under
Section 401 and 403(b) plans and IRAs must meet minimum incidental death benefit
requirements under the Code. This requirement does not apply in the case of
Section 401 plan Participants when the Participant's spouse is the designated
beneficiary. Similar requirements are applicable to Section 457 plans for tax
years beginning after December 31, 1988.
 
    Employers may deduct their contributions to self-employed and corporate
pension and profit-sharing plans described in section 401 of the Code and tax-
sheltered Annuities described in section 403(b) in the year when made, up to the
limits specified in the Code. In addition these plans may permit nondeductible
employee contributions. Any nondeductible employee contribution will be received
tax free as a portion of each annuity payment.
 
NON-QUALIFIED CONTRACTS
 
    Distributions before the Annuity Date are treated as coming first from
earnings, rather than purchase payments, until the entire amount of earnings has
been distributed. For federal tax purposes, distributions include the receipt of
proceeds from loans and the assignment or pledge of any portion of the Contract
Value, as well as withdrawals, income payments, or death benefits. Deferred
annuity contracts issued by an issuer to a policyholder in one calendar year
will be treated as one contract for purposes of determining the tax consequences
of any distribution. Distributions before the Annuity Date are taxable as
ordinary income to the extent that the Contract Value, unreduced by surrender
charges, exceeds Purchase Payments.
 
    Different rules apply to amounts distributed as an Annuity. A portion of
each Annuity payment is treated as a nontaxable return of Purchase Payments. The
remaining portion of each Annuity payment is taxable as ordinary income. The
amount of each Annuity payment which is taxable is based on the period over
which payments are to be made or, in the case of a life Annuity, the life
expectancy of the Annuitant. A lump sum taken in lieu of remaining Annuity
payments will be treated for tax purposes as a withdrawal.
 
    Income distributed as an Annuity or as a lump sum withdrawal will be subject
of a 10% excise tax unless the distribution (1) occurs after the taxpayer
attained age 59 1/2, (2) occurs after death or disability of the holder, (3) is
attributable to an investment prior to August 14, 1982, (4) is in the form of an
immediate annuity or (5) is a part of substantially equal payments to be made
over the life or life expectancy of the taxpayer or the taxpayer and his or her
designated beneficiary. The penalty will be imposed if an individual who elected
to receive payments in substantially equal installments as a life or life
expectancy annuity prior to age 59 1/2 changes the method of distribution before
age 59 1/2. This individual will be assessed the penalty even after age 59 1/2
if annuity payments have not continued for five (5) years.
 
    Code Section 72(e)(11) provides that multiple annuity contracts which are
issued within a calendar year to the same Contract Owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences.
 
WITHHOLDING
 
   
    Security First Life is required to withhold federal income tax on Annuity
payments, lump sum distributions and partial withdrawals. However, recipients of
Contract distributions are allowed to make an election not to have federal
income tax withheld except as otherwise described below. After an election is
made with respect to Annuity payments, an Annuitant may revoke the election at
any time, and thereafter commence withholding. Security First Life will notify
the payee at least annually of his or her right to revoke the election.
    
 
    Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10
 
                                       21
<PAGE>   25
 
years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in a direct trustee-to-trustee transfer, no withholding
will be required.
 
    Payees are required by law to provide Security First Life (as payor) with
their correct taxpayer identification number ("TIN"). If the payee is an
individual, the TIN is the same as his or her social security number.
 
   
OBTAINING TAX ADVICE
    
 
   
    It should be recognized that the federal income tax information in this
prospectus is not exhaustive and is for information purposes only. The
discussion above does not purport to cover all situations involving the purchase
of an Annuity or the election of an option under the Contract. Tax results may
vary depending upon individual situations and special rules may apply in certain
cases. State and local tax results may also vary. For these reasons a qualified
tax adviser should be consulted.
    
 
                                 VOTING RIGHTS
 
    Each Owner will have the right to instruct Security First Life with respect
to voting the Fund shares which are the assets underlying his interest in the
Separate Account, at all regular and special shareholders meetings. Security
First Life will mail to each Owner, at his last known address, all periodic
reports and proxy material of the applicable Fund and a form with which to give
voting instructions. Fund shares as to which no timely instructions are received
will be voted by Security First Life in proportion according to the instructions
received from all Owners giving timely instructions. Security First Life is
under no duty to inquire as to the instructions received or the authority of
persons to instruct the voting of Fund shares, and unless Security First Life
has actual knowledge to the contrary, the instructions given to it will be valid
as they affect Security First Life or the Funds.
 
    Once Annuity payments with respect to an Owner's Account have begun, the
Annuitant shall have any voting rights exercisable with respect to the Fund
shares.
 
    The number of votes to be cast by each person having the right to vote shall
be determined as of a record date within 90 days prior to the meeting of the
Fund, and voting instructions will be solicited by written communication at
least 10 days prior to such meeting. To be entitled to vote, an Owner or
Annuitant must have been such on the record date. The number of shares as to
which voting instructions may be given to Security First Life is determined by
dividing that portion of the Contract Value then allocated to the Series for
that Fund on the record date by the net asset value of a Fund share as of the
same date.
 
                               LEGAL PROCEEDINGS
 
    Security First Life, in the ordinary course of its business, is engaged in
litigation of various kinds which in its judgment is not of material importance
in relation to its total assets. There are no present or pending material legal
proceedings affecting the Separate Account.
 
                             ADDITIONAL INFORMATION
 
   
    For further information contact Security First Life at the address and phone
number on the cover of this Prospectus. A copy of the Statement of Additional
Information, dated May 1, 1996, which provides more detailed information about
the Contracts, may also be obtained. Set forth below is the table of contents
for the Statement of Additional Information.
    
 
    A registration statement has been filed with the SEC under the Securities
Act of 1933 with respect to the Contracts offered hereby. This Prospectus does
not contain all the information set forth in the registration statement, to all
of which reference is made for further information concerning the Separate
Account, Security First Life and the Contracts offered hereby. Statements
contained in this Prospectus as to the contents of the Contracts and other legal
instruments are summaries. For a complete statement of the terms thereof
reference is made to such instruments as filed.
 
                                       22
<PAGE>   26
 
            TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION
 
   
<TABLE>
<CAPTION>
                                                                                                  PAGE
<S>                                                                                              <C>
The Insurance Company............................................................................    3
The Separate Account.............................................................................    3
The Funds........................................................................................    3
Purchase of Securities Being Offered.............................................................    6
Net Investment Factor............................................................................    7
Annuity Payments.................................................................................    7
Withholding on Annuity Payments and Other Distributions..........................................    9
Underwriters, Distribution of the Contracts......................................................    9
Calculation of Performance Data..................................................................   10
Voting Rights....................................................................................   11
Safekeeping of the Securities....................................................................   11
Servicing Agent..................................................................................   12
Independent Auditors.............................................................................   12
Legal Matters....................................................................................   12
State Regulation of Security First Life..........................................................   12
Financial Statements.............................................................................   12
</TABLE>
    
 
                                       23
<PAGE>   27
 
                     SECURITY FIRST LIFE SEPARATE ACCOUNT A
- --------------------------------------------------------------------------------
 
                          INDIVIDUAL FLEXIBLE PAYMENT
                      FIXED AND VARIABLE ANNUITY CONTRACTS
 
                     Security First Life Insurance Company
                          11365 West Olympic Boulevard
                         Los Angeles, California 90064
- --------------------------------------------------------------------------------
 
The individual flexible payment, Fixed and Variable Annuity Contracts (the
"Contracts") described in this Prospectus are issued by Security First Life
Insurance Company ("Security First Life"). The Contracts are designed to provide
Annuity benefits in connection with required distributions from retirement plans
that qualify under the Internal Revenue Code of 1986, as amended (the "Code").
 
The Contracts may also be used to provide Annuity benefits prior to any
mandatory distributions and also in connection with retirement plans which are
not qualified under the Code.
 
   
Five Funds constitute the underlying investment medium for the Contracts: the
Virtus Equity Series (formerly the Value Equity Series) and the Virtus U.S.
Government Income Series (formerly the U.S. Government Income Series) of the
Security First Trust, and the Money Market Portfolio, the Growth Portfolio and
the Overseas Portfolio of the Variable Insurance Products Fund.
    
 
   
This Prospectus sets forth information a prospective investor should know before
investing. Additional information about the Contracts has been filed with the
Securities and Exchange Commission ("SEC") in a Statement of Additional
Information, dated May 1, 1996, which information is incorporated herein by
reference and is available without charge upon written request to Security First
Life Insurance Company, P.O. Box 92193, Los Angeles, California 90009 or by
telephoning 1(800)284-4536.
    
 
The table of contents of the Statement of Additional Information appears on page
21 of the Prospectus.
- --------------------------------------------------------------------------------
 
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING OF SHARES OF ANY UNDERLYING FUND
FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN RECEIVED AND IN NO EVENT WILL
DESIGNATION OF AN UNDERLYING FUND FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN
RECEIVED BE PERMITTED UNLESS THE OWNER RECEIVES SUCH A PROSPECTUS.
 
PLEASE READ AND RETAIN THIS PROSPECTUS FOR FUTURE REFERENCE.
- --------------------------------------------------------------------------------
 
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 THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
 
                                IMPORTANT NOTICE
ANNUITIES, MUTUAL FUNDS, AND OTHER INVESTMENTS ARE NOT INSURED BY THE FDIC OR
ANY OTHER GOVERNMENT AGENCY. THEY ARE NOT DEPOSITS, OBLIGATIONS, OR GUARANTEED
BY ANY BANK. THEY INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL AMOUNT INVESTED.
- --------------------------------------------------------------------------------
 
   
Prospectus dated May 1, 1996                                   SF 135-R2S (5/96)
    
<PAGE>   28
 
                               TABLE OF CONTENTS
 
<TABLE>
<CAPTION>
                                                                                                 PAGE
                                                                                                 ----
<S>                                                                                              <C>
Glossary.......................................................................................    3
Summary of the Contracts.......................................................................    4
Fee Tables.....................................................................................    6
Condensed Financial Information................................................................    8
Performance....................................................................................    8
Financial Information..........................................................................    9
Description of Security First Life Insurance Company,
  The General Account, The Separate Account and The Funds......................................    9
    The Insurance Company......................................................................    9
    The General Account........................................................................    9
    The Separate Account.......................................................................    9
    The Funds..................................................................................   10
Principal Underwriter..........................................................................   11
Servicing Agent................................................................................   11
Custody of Securities..........................................................................   11
Contract Charges...............................................................................   11
    Premium Taxes..............................................................................   11
    Surrender Charges..........................................................................   11
    Administration Fees........................................................................   12
    Mortality Risk and Administrative Expense Risk Charge......................................   12
    10-Day Free Look...........................................................................   13
Description of the Contracts...................................................................   13
    Assignment.................................................................................   13
    Purchase Payments..........................................................................   13
    Conversions................................................................................   13
    Dollar Cost Averaging......................................................................   13
    Reallocation Election......................................................................   14
    Modification of the Contracts..............................................................   14
Accumulation Period............................................................................   14
    Crediting Accumulation Units in the Separate Account.......................................   14
    Separate Account Accumulation Unit Current Values..........................................   14
    Net Investment Factor......................................................................   14
    Surrender from the Separate Account........................................................   15
    Statement of Account.......................................................................   15
Annuity Benefits...............................................................................   15
    Variable Annuity Payments..................................................................   15
    Assumed Investment Return..................................................................   15
    Election of Annuity Date and Form of Annuity...............................................   15
    Frequency of Payment.......................................................................   16
    Level Payments Varying Annually............................................................   17
    Annuity Unit Values........................................................................   17
Death Benefits.................................................................................   17
    Death Before the Annuity Date..............................................................   17
    Death After the Annuity Date...............................................................   18
Federal Income Tax Status......................................................................   18
    Qualified Contracts........................................................................   18
    Non-Qualified Contracts....................................................................   19
    Withholding................................................................................   20
Voting Rights..................................................................................   20
Legal Proceedings..............................................................................   20
Additional Information.........................................................................   20
Table of Contents of Statement of Additional Information.......................................   21
</TABLE>
 
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus in connection with
the offer described herein and, if given or made, such information or
representations must not be relied upon as having been authorized. This
Prospectus does not constitute an offer in any jurisdiction to any person to
whom such offer would be unlawful therein.
 
                                        2
<PAGE>   29
 
                                    GLOSSARY
 
As used in this Prospectus, these terms have the following meanings:
 
ACCUMULATION UNIT -- A measuring unit used to determine the value of an Owner's
interest in a Separate Account Series under a Contract at any time before
Annuity Payments commence.
 
ANNUITANT -- The person on whose life Annuity payments under a Contract are
based.
 
ANNUITY -- A series of income payments made to an Annuitant for a defined period
of time.
 
ANNUITY DATE -- The date on which Annuity payments begin.
 
ANNUITY UNIT -- A measuring unit used to determine the amount of Variable
Annuity payments based on a Separate Account Series under a Contract after such
payments have commenced.
 
ASSUMED INVESTMENT RETURN -- The investment rate selected by the Annuitant for
use in determining the Variable Annuity payments.
 
BENEFICIARY -- The person who has the right to a Death Benefit upon the death of
the Owner.
 
   
BUSINESS DAY -- Each Monday through Friday except for days the New York Stock
Exchange is not open for trading.
    
 
CONTRACT -- The agreement between Security First Life and the Contract Owner
covering the rights of the Owner.
 
CONTRACT DATE -- The date an Owner's Contract is issued.
 
CONTRACT VALUE -- The sum of the Owner's interest in the Separate Account Series
and the Owner's interest in the General Account. The Owner's interest in the
Separate Account Series is the sum of the values of the Accumulation Units. The
Owner's interest in the General Account is the accumulated value of the amounts
allocated to the General Account plus the interest credited thereon as
guaranteed in the Contract, less any prior withdrawals and/or amounts applied to
annuity options.
 
CONTRACT YEAR -- A 12-month period starting on the Contract Date and on each
anniversary thereof.
 
FIXED ANNUITY -- An Annuity providing guaranteed level payments. Such payments
are not based upon the investment experience of the Separate Account.
 
FREE WITHDRAWAL AMOUNT -- The amount of the first surrender in a Contract Year
which may be surrendered without incurring a surrender charge.
 
FUND -- A diversified, open-end management investment company, or series
thereof, registered under the Investment Company Act of 1940 ("1940 Act") which
serves as the underlying investment medium for a Series in the Separate Account.
 
GENERAL ACCOUNT -- All assets of Security First Life other than those in the
Separate Account or any of its other segregated asset accounts.
 
NORMAL ANNUITY DATE -- The first day of the month coincident with or next
following the anniversary of the Contract Date nearest the Annuitant's 85th
birthday, or the 10th anniversary, if later.
 
OWNER -- The person who has title to the Contract.
 
PURCHASE PAYMENT -- The amounts paid to Security First Life in order to provide
benefits under the Contract.
 
SEPARATE ACCOUNT -- The segregated asset account entitled "Security First Life
Separate Account A" which has been established by Security First Life pursuant
to Delaware law to receive and invest amounts allocated and to provide Variable
Annuity benefits under the Contracts. The Separate Account is registered as a
unit investment trust under the 1940 Act.
 
SERIES -- The Accumulation Unit values and Annuity Unit values maintained
separately for each Fund whose securities are owned by the Separate Account.
 
VALUATION DATE -- Any Business Day used by the Separate Account to determine the
value of part or all of its assets for purposes of determining Accumulation and
Annuity Unit values for the Contract. Accumulation Unit values will be
determined each Business Day. There will be one Valuation Date in each calendar
week for Annuity Unit values. Security
 
                                        3
<PAGE>   30
 
First Life will establish the Valuation Date at its discretion, but until notice
to the contrary is given, that date will be the last Business Day in a week.
 
VALUATION PERIOD -- The period of time from one Valuation Date through the next
Valuation Date.
 
VARIABLE ANNUITY -- An Annuity providing payments which will vary annually in
accordance with the net investment experience of the applicable Separate Account
Series.
 
                            SUMMARY OF THE CONTRACTS
 
THE CONTRACTS
 
    The Contracts may be issued to plans qualifying for special tax treatment
("Qualified Contracts"), such as individual retirement annuities, Section 403(b)
tax-sheltered annuities, Section 457 deferred compensation plans, money purchase
pension plans and profit sharing plans. (See "Qualified Contracts," page 18.)
The Contracts may also be issued pursuant to retirement plans that do not
qualify for special tax treatment ("Non-Qualified Contracts") and to individuals
seeking to accumulate funds for retirement whether or not such individuals are
otherwise participating in qualified or non-qualified retirement plans. This
Prospectus is intended to serve as a disclosure document for the variable
portion of the Contracts only.
 
PURCHASE PAYMENTS
 
   
    Purchase Payments under the Contracts are made to the General Account, the
Separate Account or allocated between them. The minimum initial Purchase Payment
is $1,000 and each additional Purchase Payment must be at least $100 ($500
initial purchase payment and $100 additional payment for IRAs). There is no
initial sales charge; however, certain charges and deductions will be made to
the Contract Value. (See "Contract Charges," page 11.) Amounts allocated to the
Separate Account may be transferred among the Series at any time and any number
of times and may be transferred to the General Account at any time before being
applied to a Variable Annuity option. Amounts allocated to the General Account
may be transferred to the Separate Account only to be applied to a Variable
Annuity option. (See "Conversions," page 13.)
    
 
SEPARATE ACCOUNT
 
   
    Pursuant to the Participant's designation, Purchase Payments allocated to
the Separate Account are invested at net asset value in Accumulation Units of
one or more of five series, each of which consists of shares of a different
Fund. The Funds presently consist of the Virtus Equity Series and the Virtus
U.S. Government Income Series of the Security First Trust and the Money Market
Portfolio, Growth Portfolio and Overseas Portfolio of the Variable Insurance
Products Fund. The investment adviser and manager of Security First Trust is
Security First Investment Management Corporation ("Security Management"). Virtus
Capital Management, Inc. ("Virtus") is a subadviser to Security Management and
provides investment management services to the Virtus Equity Series and the
Virtus U.S. Government Income Series. The Money Market Portfolio, Growth
Portfolio and Overseas Portfolio are advised by Fidelity Management & Research
Company ("FMR"). (See "The Separate Account," page 9 and "The Funds," page 10.)
    
 
CHARGES AND DEDUCTIONS
 
    An administration fee will be deducted daily from the Owner's interest in
the Separate Account in the amount of .00041% (.15% per annum). (See
"Administration Fees," page 12.)
 
    Daily deductions will be made for mortality risks in the amount of .002192%
(.80% per annum) and for administrative expense risks in the amount of .001233%
(.45% per annum). Until further notice, Security First Life will waive mortality
risk and administrative expense risk charges to 1.00% per annum, and this
reduction is permanent for Contracts issued prior to the termination or
reduction of the waiver. (See "Mortality Risk and Administrative Expense Risk
Charge," page 12.)
 
    A surrender charge (contingent deferred sales charge) may be deducted in the
event the Owner requests a full or partial surrender from the Separate Account.
The surrender charge is based on a graduated table of charges starting at 7% of
a Purchase Payment and amounts credited respecting such payment in the first
year from receipt and decreasing 1% per year so that no charge is made with
respect to a Purchase Payment and amounts credited thereon which was received
seven or more years before the surrender. No charge will be made for that part
of the first surrender in a
 
                                        4
<PAGE>   31
 
Contract Year that does not exceed 10% of the Owner's interest in the Separate
Account and 10% of his or her interest in the General Account. (See "Surrender
Charges," page 11.)
 
    Premium taxes payable to any state or other governmental agency with respect
to the Owner's Account may be deducted on or after the date they were incurred.
Premium taxes currently range from 0% to 2.35% (3.50% in Nevada). Until further
notice, Security First Life will deduct premium taxes upon annuitization. (See
"Premium Taxes," page 13.)
 
   
FREE LOOK PERIOD
    
 
   
    At any time within ten days (or such longer period as required by state law)
after the receipt of the Contract it may be returned for cancellation and a full
refund of all Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. (See "Free Look Period," page 13).
    
 
VARIABLE ANNUITY PAYMENTS
 
    Monthly Annuity payments will start on the Annuity Date. The Owner selects
the Annuity Date, an Annuity payment option, and an assumed investment return.
Any of these selections may be changed prior to the Annuity Date. The Variable
Annuity payment will vary annually based on a comparison of the assumed
investment returns with the investment experience of the Series in which the
Contract Value is invested. (See "Variable Annuity Payments," page 15.)
 
    If Annuity payments from any one Series would be less than $50, Security
First Life reserves the right to change the frequency of the payments from that
Series to such intervals as will result in payments of at least $50 from each
Series. (See "Frequency of Payment," page 16.)
 
SURRENDER
 
    An Owner may surrender, before the Annuity Date, all or part of his or her
Contract Value. However, no partial surrender is permitted if it would reduce
the Owner's interest in any Series or the General Account to less than $500,
unless the entire amount allocated to that Series or the General Account is
being surrendered. A surrender charge may be assessed. (See "Surrender Charges,"
page 11.) In addition, the earnings surrendered will be taxed as ordinary income
and may be subject to a penalty tax under the Code. (See "Federal Income Tax
Status," page 18.) Certain restrictions are applicable to surrender from
Contracts funding retirement plans qualified for special tax treatment under the
Code. (See "Qualified Contracts," page 18.)
 
DEATH BENEFIT
 
    Unless otherwise restricted, in the event of the Owner's death prior to the
Annuity Date, the designated Beneficiary may elect either to receive a death
benefit in a lump sum or to apply the death benefit under certain of the
available optional Annuity forms contained in the Contract. The death benefit is
the greater of: (i) Purchase Payments reduced by amounts applied to partial
withdrawals or annuity income; (ii) the Contract Value at settlement or (iii) if
the Contract is issued on or before the date the Owner attains age 70, the
greater of the Contract Value on the seventh anniversary of the Contract Date or
each fifth anniversary thereafter, in each case reduced by amounts subsequently
applied to partial withdrawals or annuity income (see "Death Benefits," page
17).
 
                                        5
<PAGE>   32
 
                                   FEE TABLES
 
                        PARTICIPANT TRANSACTION EXPENSES
 
<TABLE>
<CAPTION>
                                                                         Years      Percentage
                                                                      ------------  ----------
              <S>                                                     <C>           <C>
              Deferred Sales Charge (as a percentage                  less than 1       7%
              of amounts accumulated with respect to                  1 but not 2       6%
              a purchase payment)                                     2 but not 3       5%
                                                                      3 but not 4       4%
                                                                      4 but not 5       3%
                                                                      5 but not 6       2%
                                                                      6 but not 7       1%
                                                                      7 or more         0%
</TABLE>
 
                           SEPARATE ACCOUNT EXPENSES
                   (AS A PERCENTAGE OF AVERAGE ACCOUNT VALUE.
                   DEDUCTED DAILY FROM THE SEPARATE ACCOUNT.)
 
Administration Fee                                               0.15% per annum
 
   
Mortality and Expense Risk Fees(1)                               1.00% per annum
    
 
   
Total Separate Account Annual Expenses(1)                        1.15% per annum
    
 
                              FUND ANNUAL EXPENSES
                    (AS A PERCENTAGE OF AVERAGE NET ASSETS)
 
   
<TABLE>
<CAPTION>
                                   Virtus
                        Virtus    U.S. Gov.     Money
                        Equity     Income      Market      Growth     Overseas
                        Series     Series     Portfolio   Portfolio   Portfolio
                        -------   ---------   ---------   ---------   ---------
<S>                     <C>       <C>         <C>         <C>         <C>
(a) Management
  Fee(3)..............   0.34%      0.22%       0.24%       0.61%       0.76%
(b) Other
  Expenses(3).........   0.66%      0.48%       0.09%       0.09%       0.15%
(c) Total Annual
    Expenses(3).......   1.00%      0.70%       0.33%       0.70%       0.91%
</TABLE>
    
 
                                        6
<PAGE>   33
 
EXAMPLES
 
   
<TABLE>
<CAPTION>
                                 CONDITIONS
 SEPARATE    A PARTICIPANT WOULD PAY THE FOLLOWING EXPENSES ON A                 TIME PERIODS
  ACCOUNT      $1,000 INVESTMENT ASSUMING 5% ANNUAL RETURN ON         ----------------------------------
  SERIES                           ASSETS:                            1 YEAR  3 YEARS  5 YEARS  10 YEARS
- -----------  ---------------------------------------------------      ------  -------  -------  --------
<S>          <C>                                                  <C> <C>     <C>      <C>      <C>
Virtus       (a) upon surrender at the end of the stated time     (a)  $ 93    $ 121    $ 148     $245
Equity           period
Series
             (b) if the Certificate WAS NOT surrendered           (b)  $ 22    $  66    $ 114     $245
- -----------  ---------------------------------------------------      ------  -------  -------  --------
Virtus       SAME                                                 (a)  $ 91    $ 112    $ 134     $214
U.S. Gov.
Income
Series
                                                                  (b)  $ 19    $  57    $  99     $214
- -----------  ---------------------------------------------------      ------  -------  -------  --------
Money        SAME                                                 (a)  $ 87    $ 101    $ 115     $174
Market
Portfolio
                                                                  (b)  $ 15    $  46    $  79     $174
- -----------  ---------------------------------------------------      ------  -------  -------  --------
Growth       SAME                                                 (a)  $ 91    $ 112    $ 134     $214
Portfolio
                                                                  (b)  $ 19    $  57    $  99     $214
- -----------  ---------------------------------------------------      ------  -------  -------  --------
Overseas     SAME                                                 (a)  $ 93    $ 118    $ 144     $236
Portfolio
                                                                  (b)  $ 21    $  64    $ 109     $236
- -----------  ---------------------------------------------------      ------  -------  -------  --------
</TABLE>
    
 
                     EXPLANATION OF FEE TABLE AND EXAMPLES
 
1. Security First Life has determined to voluntarily waive its mortality risk
   and administrative expense risk charges to 1.00% per annum. Absent this
   waiver, the charges would have been 1.25% per annum. This may be terminated
   at any time, but any change in this waiver will not affect Contracts issued
   prior to the change.
 
2. The purpose of the foregoing tables and examples is to assist the Owner in
   understanding the various costs and expenses that he or she will bear
   directly or indirectly. The table reflects expenses of the Separate Account
   as well as the underlying Funds. For additional information see "Contract
   Charges," beginning on page 11.
 
   
3. The management fees for the Virtus Equity Series and the Virtus U.S.
   Government Income Series have been reduced to reflect the voluntary waiver by
   the investment adviser and subadviser. The maximum advisory fee for each of
   the series is .90% (which amount includes a maximum sub-advisory fee of
   .75%).
    
 
4. Premium taxes are not reflected. Presently, premium taxes ranging from 0% to
   2.35% (3.50% in Nevada) may be deducted from each Purchase Payment or upon
   annuitization. However, Security First Life presently deducts premium tax
   only from amounts annuitized.
 
5. NEITHER THE TABLE NOR THE EXAMPLES ARE REPRESENTATIONS OF PAST OR FUTURE
   EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
 
                                        7
<PAGE>   34
 
                        CONDENSED FINANCIAL INFORMATION
 
    The following table sets forth condensed financial information on
Accumulation Units respecting contracts issued under this prospectus through the
Separate Account. The information is derived from the financial statements of
the Separate Account which have been audited by Ernst & Young LLP, the Separate
Account's independent auditors. The information should be read in conjunction
with the financial statements, related notes and other financial information in
the Statement of Additional Information.
 
   
<TABLE>
<CAPTION>
                                      Period Ended      Period Ended        Period Ended        Period Ended
                                      July 31, 1993   December 31, 1993   December 31, 1994   December 31, 1995
                                      -------------   -----------------   -----------------   -----------------
<S>                                   <C>             <C>                 <C>                 <C>
Series SU (Virtus U.S. Government
  Series)
  Beg. AUV $ (6/30/93)..............        5.00              5.00                5.02                 4.81
  End. AUV $........................        5.00              5.02                4.81                 5.40
  End. No. Non-Qualified AUS........      12,635           135,953             361,796              740,509
  End. No. Qualified AUS............                       168,822             576,840              952,163
Series SV (Virtus Equity Series)
  Beg. AUV $ (6/30/93)..............        5.00              4.96                5.07                 4.73
  End. AUV $........................        4.96              5.07                4.73                 5.98
  End. No. Non-Qualified AUS........      26,986           144,893             366,202              890,484
  End. No. Qualified AUS............                       113,278             596,426            1,296,111
Series FM (Money Market Portfolio)
  Beg. AUV $ (7/14/93)..............        5.00              5.00                5.04                 5.20
  End. AUV $........................        5.00              5.04                5.20                 5.44
  End. No. Non-Qualified AUS........       4,080             4,080              21,636               58,968
  End. No. Qualified AUS............                                            36,961               81,397
  Yield.............................        1.07%             2.01%               4.55%                4.08%
Series FG (Growth Portfolio)
  Beg. AUV $ (5/26/94)..............                                              5.00                 5.22
  End. AUV $........................                                              5.22                 6.99
  End. No. Non-Qualified AUS........                                           123,202              443,818
  End. No. Qualified AUS............                                           236,216              640,618
Series FO (Overseas Portfolio)
  Beg. AUV $ (5/26/94)..............                                              5.00                 4.83
  End. AUV $........................                                              4.83                 5.24
  End. No. Non-Qualified AUS........                                            73,534              268,010
  End. No. Qualified AUS............                                           114,022              399,940
</TABLE>
    
 
- ---------------
   
AUV -- Accumulation Unit Value
    
   
AUs  -- Accumulation Units
    
 
                                  PERFORMANCE
 
   
    Security First Life may from time to time advertise the yield and effective
yield on the Series invested in the Money Market Portfolio of the Separate
Account and the average annual total returns for the other Series of the
Separate Account. Yields and average annual total returns are determined in
accordance with the methods of computation set forth by the SEC in the Form N-4
Registration Statement and are more particularly described in the Statement of
Additional Information. Yields are expressed for a seven day period annualized,
and average annual total returns are expressed for at least one, five and ten
year periods (or from inception if shorter).
    
 
                                        8
<PAGE>   35
 
   
    The yields of the Series invested in the Money Market Portfolio are
determined based upon the change in the value of an outstanding unit in the
Separate Account over a seven day period and annualizing the result. The
computation takes into account recurring deductions from account values, but no
deduction is made for surrender charges which may apply upon a full or partial
surrender. These charges are described in "Surrender Charges," page 11. In the
event of a surrender of the Contract, the imposition of surrender charges will
have the effect of reducing the yield earned over the period of ownership.
    
 
    The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.
 
                             FINANCIAL INFORMATION
 
    Financial Statements of the Separate Account and Security First Life are
contained in the Statement of Additional Information.
 
             DESCRIPTION OF SECURITY FIRST LIFE INSURANCE COMPANY,
            THE GENERAL ACCOUNT, THE SEPARATE ACCOUNT AND THE FUNDS
 
THE INSURANCE COMPANY
 
   
    Security First Life is a stock life insurance company founded in 1960 and
organized under the laws of the State of Delaware. Its principal executive
offices are located at 11365 West Olympic Boulevard, Los Angeles, California
90064. Security First Life owns all of the outstanding stock of Fidelity
Standard Life Insurance Company. Security First Life is a wholly-owned
subsidiary of Security First Group, Inc. ("SFG") (formerly The Holden Group,
Inc.). The outstanding voting stock of SFG is owned by London Insurance Group,
Inc., a Canadian insurance service corporation and publicly traded subsidiary of
the Trilon Corporation of Toronto, Canada. Security First Life is authorized to
transact the business of life insurance, including annuities. Security First
Life presently is licensed to do business in 49 states and the District of
Columbia.
    
 
THE GENERAL ACCOUNT
 
    The General Account is made up of all the assets of Security First Life,
other than those in the Separate Account and other segregated asset accounts.
The Owner may allocate amounts to the General Account at the time of purchase or
by subsequent transfers from the Separate Account. Amounts allocated to the
General Account will be credited with interest on the basis of interest rates
guaranteed or declared by Security First Life under the terms of the Contract.
Instead of the Owner bearing the risk of fluctuations in the value of the assets
as is the case for amounts invested in the Separate Account, Security First Life
bears the full investment risk for amounts in the General Account. Security
First Life has sole discretion to invest the assets of the General Account,
subject to applicable law. The General Account provisions of the Contract are
not intended to be offered by this Prospectus. Contract Owners are referred to
the terms of the Contract itself for more information concerning these
provisions.
 
THE SEPARATE ACCOUNT
 
    The Separate Account was established by Security First Life on May 29, 1980,
in accordance with the provisions of the Delaware Insurance Code. It is
registered as a unit investment trust under the 1940 Act. Registration with the
SEC does not involve supervision by the SEC of the management or investment
practices or policies of the Separate Account or Security First Life.
 
    The Separate Account and each Series therein are administered and accounted
for as part of the general business of Security First Life, but the income and
realized capital gains or losses of each Series are credited to or charged
against the assets held for that Series in accordance with the terms of the
Contracts. This is done without regard to the income, realized capital gains or
losses of any other Series or the experience of Security First Life in any other
business it may conduct. The assets within each Series are not chargeable with
liabilities incurred by any other Series, or arising out of any other business
Security First Life may conduct.
 
    All obligations arising under the Contracts, including the guarantee to make
annuity payments, are general corporate obligations of Security First Life, and
all of Security First Life's assets are available to meet its expenses and
obligations under the Contracts. However, while Security First Life is obligated
to make the Variable Annuity payments
 
                                        9
<PAGE>   36
 
under the Contracts, the amount of such payments is guaranteed only to the
extent of the level amount calculated at the beginning of each Annuity year.
(See "Level Payments Varying Annually," page 17.)
 
   
    The Separate Account is divided into a number of Series of Accumulation and
Annuity Units, five of which are available under the Contracts, and each Series
invests in the shares of only one of the Funds. Series SV, Series SU, Series FM,
Series FG and Series FO invest in shares of the Virtus Equity Series, the Virtus
U.S. Government Income Series, the Money Market Portfolio, the Growth Portfolio
and the Overseas Portfolio, respectively. The shares of each Fund are purchased,
without sales charge, for the corresponding Series at the net asset value per
share next determined by each Fund following receipt of the applicable payment.
Any dividend or capital gain distributions received from a Fund are reinvested
in Fund shares which are retained as assets of the applicable Series. Fund
shares will be redeemed without fee to the Series to the extent necessary for
Security First Life to make Annuity or other payments under the Contracts.
    
 
    If shares of any Fund should no longer be available for investment by a
Series or if in the judgment of Security First Life's management further
investment in the shares of any fund should become inappropriate in view of the
purposes of the Contracts issued, Security First Life may substitute for the
Fund shares already purchased, and apply future Purchase Payments under the
Contracts to the purchase of shares of another Fund or other securities. No
substitution of securities of any Series may take place, however, without notice
to Owners and the prior approval of the SEC.
 
THE FUNDS
 
    Each of the Funds is a series of an open-end management investment company
registered with the SEC under the 1940 Act. Registration does not involve
supervision by the SEC of the investments or investment policies of the Funds.
There can be no assurance that the investment objectives of the Funds will be
achieved.
 
   
    The Security First Trust is a Massachusetts business trust which presently
has four series, two of which are available under this Contract series -- the
Virtus Equity Series and the Virtus U.S. Government Income Series.
    
 
   
    The Virtus Equity Series (formerly the Value Equity Series) seeks to provide
growth of capital and income. The Series pursues this objective by investing in
common stocks of high quality companies. The Series is managed to take advantage
of trends in the stock market that favor different styles of stock selection
(value or growth) and different sizes of companies (consisting of large, medium
and small).
    
 
   
    The Virtus U.S. Government Income Series (formerly the U.S. Government
Income Series) seeks to provide current income. The Series pursues this
objective by investing in a professionally managed, diversified portfolio
limited primarily to U.S. government securities.
    
 
   
    Security Management, a subsidiary of SFG and an affiliate of Security First
Life and Security First Financial, Inc., provides investment advice and
management services to the two Funds. Under a subadvisory agreement with
Security Management, Virtus provides investment management services to each of
these Funds.
    
 
    Variable Insurance Products Fund is a Massachusetts business trust. It is
divided into five separate portfolios, three of which are offered under the
Contracts -- the Money Market Portfolio, Growth Portfolio and Overseas
Portfolio.
 
    The Money Market Portfolio seeks to obtain as high a level of current income
as is consistent with preserving capital and providing liquidity. The portfolio
will invest only in high quality U.S. dollar denominated money market securities
of domestic and foreign issuers.
 
    The Growth Portfolio seeks to achieve capital appreciation normally through
the purchase of common stocks (although the portfolio's investments are not
restricted to any one type of security). Capital appreciation may also be found
in other types of securities, including bonds and preferred stock.
 
    The Overseas Portfolio seeks long-term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.
 
    FMR is the investment adviser to the Money Market Portfolio, Growth
Portfolio and Overseas Portfolio of the Variable Insurance Products Fund.
 
    The Funds are available to registered separate accounts offering variable
annuity and variable life products of participating insurance companies and to
other entities permitted under Section 817(h) of the Code. Although it is not
anticipated that any disadvantage will result, there is a possibility that a
material conflict may arise between the interest of the Separate Account and one
or more of the other separate accounts participating in the Funds. A conflict
may
 
                                       10
<PAGE>   37
 
occur due to a change in law affecting the operations of variable life and
variable annuity separate accounts, differences in the voting instructions of
our Owners and those of other companies, or some other reason. In the event of a
conflict, the Separate Account will take any steps necessary to protect Owners
and variable annuity payees, which may include withdrawal of amounts invested in
the Fund by the Separate Account.
 
    The rights of Participants or Beneficiaries to instruct Security First Life
on voting shares of the Funds are described under "Voting Rights," page 20.
 
    Detailed information about the Funds, their investment objectives,
investment portfolios and the charges may be found in the prospectuses of the
Funds. An investor should carefully read the prospectuses of the Funds before
investing. Prospectuses for Security First Trust and Variable Insurance Products
Fund may be obtained without charge by written request to Security First Life
Insurance Company, P.O. Box 92193, Los Angeles, California 90009.
 
                             PRINCIPAL UNDERWRITER
 
   
    Security First Financial, Inc., 11365 West Olympic Boulevard, Los Angeles,
California 90064, a broker-dealer registered under the Securities Exchange Act
of 1934 and a member of the National Association of Securities Dealers, Inc., is
the principal underwriter for the Contracts. Security First Financial, Inc., is
a Delaware corporation and a subsidiary of SFG.
    
 
                                SERVICING AGENT
 
   
    Security First Life receives certain administrative services such as office
space, supplies, utilities, office equipment, travel expenses and periodic
reports pursuant to an agreement with SFG.
    
 
                             CUSTODY OF SECURITIES
 
    The custodian of the assets of the Separate Account is Security First Life.
The assets of each Series will be kept physically segregated by Security First
Life and held separate from the assets of the other Series and of any other
firm, person, or corporation. Additional protection for the assets of the
Separate Account is afforded by fidelity bonds covering all of Security First
Life's officers and employees.
 
                                CONTRACT CHARGES
 
   
    Contract charges are assessed as follows: (i) for premium taxes; (ii) on
certain surrenders; (iii) against the value of assets in the Separate Account on
a daily basis for administration of the Contract; and (iv) against the value of
the assets in the Separate Account on a daily basis for the assumption of
mortality risks and for administrative expenses risks. These charges may not be
changed under the Contract, and Security First Life may profit from these
charges in the aggregate.
    
 
    An investor should note that there are deductions from and expenses paid out
of the assets of the Funds that are described in their respective prospectuses.
 
PREMIUM TAXES
 
    Certain state and governmental entities impose a premium tax of up to 2.35%
(3.50% in Nevada) of Purchase Payments or amounts applied to an Annuity option.
The Contracts permit Security First Life to deduct any applicable premium taxes
from the Contract Value at or after the time they are incurred. Until further
notice, Security First Life will deduct any premium tax only from amounts
applied to an Annuity option.
 
SURRENDER CHARGES
 
    No sales charge is deducted from any Purchase Payment. However, a surrender
charge (contingent deferred sales charge) may be assessed whenever a partial or
full surrender of the Contract Value is made. The surrender charge covers
expenses relating to the sale of the Contract, including commissions paid to
sales personnel and other promotion and acquisition expenses.
 
   
    Up to 10% of the Contract Value in each of the Separate Account and General
Account received in the first surrender in a Contract Year will not be subject
to a surrender charge ("Free Withdrawal Amount"). Amounts surrendered in excess
of the Free Withdrawal Amount may be subject to a surrender charge.
    
 
                                       11
<PAGE>   38
 
    The amount credited to the Owner's Account with respect to each Purchase
Payment will be subject to a charge equal to the applicable percentage of such
amount at the time a full or partial surrender is made.
 
<TABLE>
<CAPTION>
 ELAPSED TIME SINCE PURCHASE
     PAYMENT WAS RECEIVED         APPLICABLE PERCENTAGE
- ------------------------------    ---------------------
<S>                               <C>
Less than one year                          7%
1 year but less than 2 years                6%
2 years but less than 3 years               5%
3 years but less than 4 years               4%
4 years but less than 5 years               3%
5 years but less than 6 years               2%
6 years but less than 7 years               1%
7 years or more                             0%
</TABLE>
 
   
    These charges are applied by reducing the Series or General Account from
which the surrender will be taken by an amount determined by dividing the amount
elected to be surrendered by a factor derived from the above percentage charges.
This factor is equivalent to (a) - (b) where (a) is 1 and (b) is the percentage
charge expressed as a decimal. Accumulation Units are cancelled on a first-in,
first-out basis. In no event will surrender charges imposed on Accumulation
Units exceed an amount equal to 9% of Purchase Payments allocated to the
Separate Account. The effect of this varying schedule of percentage charges is
that amounts left in the Separate Account for longer periods of time are subject
to lower charges than amounts immediately surrendered.
    
 
    In the event of a partial surrender, the Owner will receive a check in the
amount requested. Surrender charges, if any, will be deducted from the Series
from which the partial surrender was taken, or proportionally from the remaining
Series in the event that a Series is fully surrendered.
 
    Surrender charges will be waived on a lump sum withdrawal if the Owner is
confined to a hospital for a minimum of 30 consecutive days or a skilled nursing
home for a minimum of 90 consecutive days and the withdrawal is requested within
60 days after termination of confinement. Surrender charges will be eliminated
when the Contracts are issued to officers, directors or full time employees of
Security First Life or its affiliates. Contracts so purchased are purchased for
investment purposes only.
 
ADMINISTRATION FEES
 
    An administration fee of .00041% (.15% per annum) is deducted from the
Owner's interest in the Separate Account on a daily basis. Contract
administration expenses include the cost of policy issuance; salaries; rent;
postage; telephone and travel expenses; legal, administrative, actuarial and
accounting fees; periodic reports; office equipment; stationery; office space;
and custodial expenses. These fees will not exceed the cost of providing such
administration services.
 
MORTALITY RISK AND ADMINISTRATIVE EXPENSE RISK CHARGE
 
    The minimum death benefit provided for by the Contracts requires Security
First Life to assume a mortality risk that the Contract Value will be less than
the Owner's Purchase Payments adjusted for prior withdrawals and/or amounts
applied to Annuity options. (See "Death Before the Annuity Date," page 17.) In
addition, because the Contracts provide life Annuity options, Security First
Life assumes a mortality risk that the death rate of Annuitants as a group will
be lower than the death rate upon which the mortality tables specified in the
Contracts are based. A fee will be charged by Security First Life to compensate
it for assuming these mortality risks in connection with amounts allocated to
the Separate Account. Security First Life will make a daily deduction from the
Separate Account for mortality risks equal to .80% on an annual basis of the
Separate Account assets funding the Contracts.
 
    Although Security First Life charges an administration fee equal to 0.15%
per annum from the value of Separate Account assets funding the Contract, there
is no assurance that these fees will be sufficient to absorb the administrative
expenses incurred by Security First Life during the term of the Contract. As
compensation for assuming the risk that the administrative expenses will exceed
such fees, Security First Life will make a daily deduction from the value of the
Separate Account assets funding the Contracts equal to .45% on an annual basis.
 
    If Security First Life has gains from the receipt of the mortality and
expense risk charges over its costs of assuming these risks under the Contracts,
it may use the gains in its discretion, including reduction of expenses incurred
in distributing the Contracts.
 
                                       12
<PAGE>   39
 
    Security First Life may voluntarily waive a portion of its mortality risk
and administrative expense risk charges. Until further notice, Security First
Life has determined to reduce its mortality risk and administrative expense risk
charge to 1.00% per annum. This reduction in the mortality and expense risk
charges is permanent for Contracts issued prior to the termination or reduction
of the waiver.
 
   
FREE LOOK PERIOD
    
 
   
    The Contract provides for an initial "Free Look" period. The Owner has the
right to return the Contract within 10 days (or such longer period as required
by state law) after the Owner receives the Contract by delivering or mailing it
to Security First Life at its administrative office. If the Contract is mailed,
it will be deemed mailed on the date of the postmark or, if sent by certified or
registered mail, the date of certification or registration. The returned
Contract will be treated as if the Company never issued it, and the Company will
refund the Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. Effective on and after June 1, 1996,
Purchase Payments contributed to the Separate Account will be allocated to the
Money Market Portfolio for the number of days of the Free Look period required
by the state. At the end of the Free Look period, the account value in the Money
Market Portfolio will be reallocated to the series of the Separate Account
selected in the application.
    
 
                          DESCRIPTION OF THE CONTRACTS
 
ASSIGNMENT
 
    The Contracts provide that an Owner may freely assign his or her rights
under them. However, the Code provides that Contracts issued in connection with
Section 401 or 403 plans and IRAs must be nontransferable and nonassignable.
 
PURCHASE PAYMENTS
 
   
    Purchase Payments may be made at any time. The minimum initial Purchase
Payment is $1,000, with each additional Purchase Payment subject to a $100
minimum ($500 initial purchase payment and $100 additional payment for IRAs).
Confirmation of each Purchase Payment received will be sent to the Owner.
    
 
CONVERSIONS
 
    Accumulation Units may be converted among the Series or to the General
Account at any time. No conversion from the General Account to Accumulation
Units is permitted except pursuant to a reallocation election. Conversion
instructions may be communicated in writing or, if permitted by Security First
Life, by telephone. If telephone conversions of Accumulation Units are
permitted, the Owner will be required to complete an authorization on the
Contract application or on another form provided by Security First Life.
Security First Life will employ reasonable procedures to confirm that telephone
instructions are genuine (including requiring one or more forms of personal
identification), and Security First Life will not be liable for following
instructions it reasonably believes to be genuine.
 
   
    Accumulation Units will be converted on the first valuation after receipt of
written or telephone instructions. Because Accumulation Unit values are
determined at the close of trading on the New York Stock Exchange (currently
4:00 P.M. Eastern Time) on a Valuation Date, conversion instructions received up
to that time will be effected at the value calculated on that Date and
instructions received after that time will be effected at the value next
calculated.
    
 
    Annuity Units may be converted among the Series at any time. Annuity Units
may not be converted to the General Account. However, amounts in the General
Account that have not been applied to a Fixed Annuity income option may be
converted to Annuity Units in one or more Series for a variable payout.
Conversions described in this paragraph may be elected in writing only and will
be effective on the first valuation following receipt of the instructions.
 
    Except as permitted under a reallocation election or a dollar cost averaging
program, a minimum of $500 must be converted from any Series or from the General
Account. The value of the Accumulation and Annuity Units converted will be
calculated as of the close of business on the day the conversion occurs.
 
DOLLAR COST AVERAGING
 
    Security First Life offers a program for dollar cost averaging in which
Owners with Contract Values of $5,000 or more may participate. The program will
periodically convert Accumulation Units from the Series invested in the Money
Market Portfolio of the Variable Insurance Products Fund to any of the other
Series selected by the Owner. The program allows the Owner to invest in
non-money market Series over any period selected by the Owner rather than
investing in
 
                                       13
<PAGE>   40
 
those Series all at once. Conversions may be made monthly, quarterly,
semi-annually, or annually in a minimum amount of $100, and Security First Life
reserves the right to limit the number of Series to which conversions can be
made (but there are not current limitations). An Owner may terminate the program
at any time on written notice to Security First Life.
 
REALLOCATION ELECTION
 
    An Owner with a Contract Value of $5,000 or more may elect in writing on a
form provided by Security First Life to systematically reallocate the values
invested in Accumulation Units among the Series and in the General Account in
order to achieve an allocation ratio established by the Owner. Conversions will
be made annually on the third business day of the month in which the anniversary
of the Contract Date occurs. No conversion from the General Account shall exceed
20% of the Owner's interest invested in the General Account. Changes in
allocation ratios can be made once each Contract Year.
 
MODIFICATION OF THE CONTRACTS
 
    The Contracts include Security First Life's assurance that Annuity payments
involving life contingencies will be based on the minimum guaranteed Annuity
purchase rates incorporated in the Contracts, regardless of actual mortality
experience. The Contracts include provisions legally binding on Security First
Life with respect to these Annuity purchase rates and such other matters as
death benefits, deductions from Purchase Payments, deductions from Contract
Values for transaction charges, deductions from the Separate Account for
actuarial risk and administrative expense risk fees, and guaranteed rates with
respect to fixed benefits. Security First Life may unilaterally change such
provisions, but only: (i) with respect to any Purchase Payments received as a
tax free exchange under the Code after the effective date of the change; (ii)
with respect to benefits and values provided by Purchase Payments made after the
effective date of the change to the extent that such Purchase Payments in any
Contract Year exceed the first year's Purchase Payments; or (iii) to the extent
necessary to conform the Contract to any Federal or state law, regulation or
ruling.
 
    A Contract may also be modified by written agreement between Security First
Life and the Owner.
 
    Inquiries as to any Contract provisions should be made in writing to
Security First Life Insurance Company, P.O. Box 92193, Los Angeles, California
90009 or by telephoning 1(800)284-4536.
 
                              ACCUMULATION PERIOD
 
CREDITING ACCUMULATION UNITS IN THE SEPARATE ACCOUNT
 
    Accumulation Units are credited to a Series upon receipt of each Purchase
Payment or conversion, as the case may be. The number of Accumulation Units to
be credited is determined by dividing the net amount allocated to a Series by
the value of an Accumulation Unit in the Series next computed following receipt
of the Payment or conversion.
 
SEPARATE ACCOUNT ACCUMULATION UNIT CURRENT VALUES
 
   
    The current value of Accumulation Units of a Series varies with the
investment experience of the Fund in which the assets of the Series are
invested. Such value is determined each business day at the close of trading on
the New York Stock Exchange (currently 4:00 P.M. Eastern Time) by multiplying
the value of an Accumulation Unit in the Series on the immediately preceding
Valuation Date by the net investment factor for the period since that day. (See
"Net Investment Factor," below.) The Owner bears the investment risk that the
aggregate current value invested in the Series may at any time be less than,
equal to, or more than the amounts originally allocated to the Series.
    
 
NET INVESTMENT FACTOR
 
    The net investment factor is an index of the percentage change (adjusted for
distributions by the Fund and the deduction of the administration fees,
mortality risk fee and administrative expense risk fee) in the net asset value
of the Fund in which a Series is invested, since the preceding Valuation Date.
The net investment factor may be greater or less than one, depending upon the
Fund's investment performance.
 
SURRENDER FROM THE SEPARATE ACCOUNT
 
    An Owner may surrender all or a portion of his or her cash value at any time
prior to the Annuity Date. A surrender may result in adverse federal income tax
consequences to the Owner including current taxation of the distribution and a
 
                                       14
<PAGE>   41
 
penalty tax on a premature distribution. (See "Federal Income Tax Status," page
18.) Owners should consult their tax advisers before making withdrawals.
 
    The cash value of an Owner's interest in the Separate Account prior to the
Annuity Date may be determined at any time by multiplying the number of
Accumulation Units for each Series credited to the Contract by the current value
of an Accumulation Unit in the Series and subtracting the surrender charges, if
any. Upon receipt of a written request for a full or partial surrender, Security
First Life will determine the value of the number of Accumulation Units
withdrawn at the Accumulation Unit value next computed.
 
    A request for a partial surrender from more than one Series must specify the
allocation of the partial surrender among the Series. No partial surrender may
be made that would cause an Owner's interest in any Series to have a value after
the surrender of less than $500, unless the entire amount allocated to such
Series is being surrendered.
 
    Payment of any amount surrendered from the Series will be made within seven
days of the date the written request is received by Security First Life.
Surrenders may be suspended when: (i) trading on the New York Stock Exchange is
restricted by the SEC or such Exchange is closed for other than weekends or
holidays; (ii) the SEC has by order permitted such suspension; or (iii) an
emergency as determined by the SEC exists making disposal of portfolio
securities or valuation of assets of the Funds not reasonably practicable.
 
STATEMENT OF ACCOUNT
 
    Prior to the Annuity Date, each Owner will be provided with a written
statement of account each calendar quarter in which a transaction occurred, but
in no event less than one annually. The statement of account will show all
transactions for the period being reported as well as the number of Accumulation
Units of each Series then credited to the Contract, the current Accumulation
Unit value for each Series, and the Contract Value as of the end of the
reporting period.
 
                                ANNUITY BENEFITS
 
VARIABLE ANNUITY PAYMENTS
 
    The Owner's interest in the Series will be applied to provide a Variable
Annuity. The dollar amount of Variable Annuity payments will reflect the
investment experience of the Series but will not be affected by adverse
mortality experience which may exceed the mortality risk charge provided for
under the Contract.
 
ASSUMED INVESTMENT RETURN
 
    Variable Annuity payments will vary from payments based on the Assumed
Investment Return depending on whether the investment experience of the Series
is better or worse than the assumed return. The choice of the Assumed Investment
Return affects the pattern of annuity payments. Over a period of time, if the
Separate Account achieved a net investment result equal to the Assumed
Investment Return applicable to a particular option, the Annuity Unit would not
change in value, and the amount of the Annuity payments would be level. However,
if the Separate Account achieved a net investment result greater than the
Assumed Investment Return, the Annuity Unit would increase in value and the
amount of the Annuity payments would increase in value each year. Similarly, if
the Separate Account achieved a net investment result smaller than the Assumed
Investment Return, the Annuity Unit would decrease in value and the amount of
the Annuity payments would decrease each year.
 
    Although a higher initial payment would be received under a higher Assumed
Investment Return, there is a point in time after which payments under a lower
Assumed Investment Return would be greater, assuming payments continue through
that point in time. The effect of a higher or lower Assumed Investment Return
can be summarized as follows: a higher Assumed Investment Return will result in
a larger initial payment but more slowly rising or more rapidly falling
subsequent payments than a lower Assumed Investment Return.
 
    Unless otherwise elected, the Assumed Investment Return will be 4.25% per
annum. To the extent permitted by state law and regulations, Security First Life
will permit election of an Assumed Investment Return of 3.50%, 5% or 6%. It
should not be inferred, however, that such returns will bear any relationship to
the actual net investment experience of the Series.
 
ELECTION OF ANNUITY DATE AND FORM OF ANNUITY
 
    The Annuity Date and the form of Annuity payment are elected by the Owner.
The normal Annuity Date is the Contract anniversary nearest to the Annuitant's
85th birthday, or the 10th anniversary of the Contract Date, whichever is later,
 
                                       15
<PAGE>   42
 
except in the case of Qualified Contracts, which may require a different date.
To the extent not prohibited by any Qualified Contract requirements, an optional
Annuity Date may be elected; such date may be the first day of any month prior
to the normal Annuity Date. The election must be made at least 31 days before
the optional Annuity Date elected.
 
    The normal form of Annuity payment under the Contracts is Option 2, a life
Annuity with 120 monthly payments certain. Unless indicated otherwise, Option 2
will be automatically applied. Changes in the optional form of Annuity payment
may be made at any time up to 31 days prior to the date on which Annuity
payments are to begin. Option 1 through 4 may be elected as either Variable
Annuities or Fixed Annuities, while Option 5 may be elected only as a Fixed
Annuity. The first year's Annuity payments described in Option 1 through 4 are
determined on the basis of (i) the mortality table specified in the Contract,
(ii) the age and, where permitted, the sex of the Annuitant, (iii) the type of
Annuity payment option(s) selected, and (iv) the Assumed Interest Return
selected. Fixed Annuity payments described in Option 5 are determined on the
basis of (i) the number of years in the payment period and (ii) the interest
rate guaranteed with respect to the option. Fixed Annuities are funded through
the General Account of Security First Life.
 
OPTION 1 -- LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual, ceasing
with the last payment due prior to the death of an individual. This option
offers the maximum level of monthly payments since there is no guarantee of a
minimum number of payments or of death benefits for Beneficiaries.
 
OPTION 2 -- LIFE ANNUITY WITH 120, 180 OR 240 MONTHLY PAYMENTS CERTAIN
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments not less than 120, 180 or 240
months, as elected. If at the death of the individual the specified number of
payments have not been made, Annuity payments will be continued during the
remainder of such period to the designated Beneficiary.
 
OPTION 3 -- INSTALLMENT REFUND LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments equal to the amount applied under
this option divided by the first monthly payment. If the payee dies before
receiving the "minimum number" of payments, the remaining payments will continue
to the designated beneficiary.
 
OPTION 4 -- JOINT AND LAST SURVIVOR ANNUITY
 
    An Annuity payable monthly during the joint lifetime of two individuals and
thereafter during the lifetime of the survivor, ceasing with the last payment
due prior to the death of the survivor.
 
OPTION 5 -- PAYMENTS FOR A DESIGNATED PERIOD
 
    A fixed dollar Annuity payable monthly for a specified number of years from
5 to 30. The amount of each payment will be based on an interest rate determined
by Security First Life, that will not be less than 3.50% per annum. Fixed
Annuity payments under this option may not be commuted to a lump sum, except as
provided under "Death Benefits," page 17.
 
FREQUENCY OF PAYMENT
 
    Payments under all options will be made on a monthly basis, unless a
different arrangement has been requested by the Owner and agreed to by Security
First Life. If at any time any payments to be made to any payee under any Series
are or become less than $50 each, Security First Life shall have the right to
decrease the frequency of payments to such intervals as will result in a payment
of at least $50 from each Series.
 
LEVEL PAYMENTS VARYING ANNUALLY
 
    Under the Contract, Variable Annuity payments are determined annually rather
than monthly, so that Annuity payments, uniform in amount, are made monthly
during each Annuity year. The level of payments for each year is based on the
investment performance of the Series up to the Valuation Date as of which the
payments are determined for the year. Thus, amounts of the Annuity payments vary
with the investment performance of the Series from year to year rather than from
month to month.
 
                                       16
<PAGE>   43
 
    The monthly Variable Annuity payments for the first year will be determined
on the last Valuation Date of the second calendar week preceding the Annuity
Date by using a formula described in the Contract. On each anniversary of the
Annuity Date, Security First Life will determine the total monthly payments for
the year then beginning. These will be determined by multiplying the number of
Annuity Units in each Series from which payments are to be made by the Annuity
Unit value of that Series for the Valuation Period in which the first payment
for that year is due.
 
    The amount of the year's Variable Annuity payments is transferred to the
General Account at the beginning of the year. Although an amount in the Separate
Account is credited to an Annuitant and transferred to the General Account to
make Annuity payments, it should not be inferred that the Annuitant has any
property rights in this amount. The Annuitant has only a contractual right to
Annuity payments from the amount credited to him or her in the Separate Account.
 
    The monthly Annuity payments for the year are made from the General Account
with interest credited, in effect, using the Assumed Investment Return of 4.25%
or the alternative Assumed Investment Return selected by the Owner. Security
First Life will experience profits or loss on the amounts placed in the General
Account to provide level monthly payments during the year to the extent that net
investment income and gains in the General Account exceed or are lower than the
Assumed Investment Return selected.
 
    Because Annuity payments for the year are set at the beginning of the year,
the Annuitant will not benefit from increases in Annuity Unit values during the
year and likewise will not be at risk for decreases during the year. However,
such increases and decreases will be reflected in the calculation of Annuity
payments for the subsequent year.
 
ANNUITY UNIT VALUES
 
    The value of an Annuity Unit at a Valuation Date is determined by
multiplying the value of the Annuity Unit at the preceding Valuation Date by an
"Annuity Change Factor." The Annuity Change Factor is an adjusted measurement of
the investment performance of the Fund since the end of the preceding Valuation
Period. The Annuity Change Factor is determined by dividing the value of the
Accumulation Unit at the Valuation Date by the value of the Accumulation Unit at
the preceding Valuation Date and multiplying the result by a neutralization
factor.
 
    The neutralization factor is determined by dividing 1 by the weekly
equivalent of the Assumed Investment Return previously selected by the
Annuitant. For example, the neutralization factor for the Assumed Investment
Return of 4.25% is 0.9991999.
 
    The number of Annuity Units for a Series is determined by dividing the
monthly Annuity payment for the first year by that Series' Annuity Unit value on
the same date the first year's Annuity payments are calculated. The number of
Annuity Units will not change unless the Owner converts Annuity Units to or from
other Series or amounts from the General Account.
 
                                 DEATH BENEFITS
 
DEATH BEFORE THE ANNUITY DATE
 
    In the event that the Annuitant who is not the Owner dies before the Annuity
Date, the Owner shall become the Annuitant. If the Owner dies before the Annuity
Date, whether or not he or she is the Annuitant, the Beneficiary will be
entitled to receive a death benefit. For purposes of determining the death of
the Owner, the death of any joint Owner shall be deemed to be the death of the
Owner. With respect to Nonqualified Contracts, if the Owner is not a natural
person and the Annuitant dies, the cash value will be paid in a lump sum to the
Owner or the Contract will be transferred to a natural person, in accordance
with the Owner's written request, and the transferee will become the Owner and
Annuitant.
 
    The death benefit shall be the greater of: (i) the Purchase Payments
received under the Contract, reduced by amounts already applied to produce
Annuity Income payments or for any prior partial surrenders; (ii) the Contract
Value at the time of settlement; or (iii) in the event the Contract is issued on
or before the date on which the oldest of the Owners attains age 70, the greater
of the Contract Value at the end of the seventh Contract Year or the Contract
Value at the end of each fifth Contract Year thereafter, in each case increased
by subsequent Purchase Payments received by Security First Life and reduced by
amounts subsequently applied to produce Annuity Income payments or to partial
surrenders.
 
   
    The Beneficiary may elect to receive the death benefit as either: (i)
Annuity Income under Annuity Income Options One, Two, or Five described in
Article 7 of the Contract, provided that an election of an Annuity Income Option
is subject to the following conditions: (a) payments must begin within one year
of the Owner's death (provided that under a Qualified Contract the spouse of the
Owner may delay commencement of payments to the date on which the Owner would
have attained age 70 1/2); (b) the guaranteed period under Option Two or the
designated period under
    
 
                                       17
<PAGE>   44
 
Option Five may not be longer than the Beneficiary's life expectancy under
applicable tables specified by the Internal Revenue Service; and (c) the
Contract Value as of the date of the first Annuity Income payment will be used
to determine the amount of the death benefit to be applied; or (ii) a lump sum
payout, provided that this payout shall be made within five (5) years of the
date of death of the Owner.
 
    If the sole Beneficiary is the spouse of the Owner, the spouse may elect to
succeed to all rights of the Owner under this Contract. If there is more than
one Beneficiary living at the time of the Owner's death, each will share in the
proceeds of the death benefit equally, unless the Owner has elected otherwise.
If the Owner outlives all Beneficiaries, the death benefit will be paid to the
Owner's estate in a lump sum. No Beneficiary shall have the right to assign,
anticipate or commute any future payments under any of the options, except as
provided in the election or by law.
 
    Rights to the death benefit will pass as if the Owner outlived the
Beneficiary if: (i) the Beneficiary dies at the same time as the Owner; or (ii)
the Beneficiary dies within 15 days of the Owner's death and prior to the date
due proof of the Owner's death is received by Security First Life. Due proof of
death will be a certified death certificate, an attending physician's statement,
a decree of a court of competent jurisdiction as to the finding of death, or
such other documents as Security First Life may, at its option, accept.
 
DEATH AFTER THE ANNUITY DATE
 
    If the Annuitant under a Contract dies on or after the Annuity Date, the
remaining portion of his or her interest will be distributed at least as rapidly
as under the method of distribution being used at the date of the Annuitant's
death. If no designated Beneficiary survives the Annuitant, the present value of
any remaining payments certain on the date of death of the Annuitant, calculated
on the basis of the assumed investment return previously elected, may be paid in
one sum to the estate of the Annuitant unless other provisions have been made
and approved by Security First Life. This value is calculated as of the date of
payment following receipt of due proof of death.
 
    Unless otherwise restricted, a Beneficiary receiving variable payments under
Option 2 or 3 after the death of an Annuitant may elect at any time to receive
the present value of the remaining number of Annuity payments certain in a
single payment, calculated on the basis of the assumed investment return
previously selected. However, such election is not available to a Beneficiary
receiving Fixed Annuity payments.
 
                           FEDERAL INCOME TAX STATUS
 
    The operations of the Separate Account form part of the operations of
Security First Life, but the Code provides that no federal income tax will be
payable by Security First Life on the investment income and capital gains of the
Separate Account. No federal income tax is payable by the Owner on the
investment income and capital gains under a Contract until Annuity payments
commence or a full or partial withdrawal is made.
 
QUALIFIED CONTRACTS
 
    Under a section 401 pension plan, withdrawals may be made only in the event
of death, disability, separation from service, or attainment of normal
retirement age. Under Section 403(b) of the Code withdrawal prior to age 59 1/2
of amounts attributable to contributions and earnings made after December 31,
1988, are restricted in a manner similar to those under Section 401 pension
plans. However, under a 403(b) annuity, the Code permits withdrawals of the
contributed amounts (and not the earnings thereon) in cases of financial
hardship. The restrictions on withdrawals from Section 403(b) annuities do not
apply to Contract values attributable to Contract values before January 1, 1989.
In the case of Section 457 deferred compensation plan, benefits are not
permitted to be made available earlier than when the employee attains age
70 1/2, separates from service or is faced with an unforeseeable emergency.
Withdrawals from an IRA can be made when the Owner attains age 59 1/2, dies or
becomes disabled.
 
    Generally, all withdrawals made prior to age 59 1/2 that are not a result of
death, disability, domestic relations order, deductible medical expense or
received as a series of substantially equal payments made for the life of the
Owner or the joint lives of the Owner and Owner's beneficiary will be subject to
an additional 10% tax. Distributions from a Section 457 plan are not subject to
this 10% penalty tax.
 
   
    In the case of section 401 plans and section 457 plans, the Contract Value
must be distributed, or Annuity payments for life or a period not exceeding the
life expectancy of the Participant or the Participant and a designated
Beneficiary must commence by April 1 of the calendar year following the calendar
year in which the employee attains age 70 1/2 (or retires in the case of
government plans and Section 457 Plans). If the Participant is the Owner of an
IRA, then the required distributions described above must be made or commenced
no later than the following April 1. The same distribution requirements apply to
403(b) tax sheltered annuities with respect to benefits accruing after December
31, 1986 in taxable years ending after that date.
    
 
                                       18
<PAGE>   45
 
    Providing certain requirements of the Code are met, distributions, other
than required distributions, from a plan may be rolled over tax-free to another
plan. Distributions from a section 401 plan may be rolled over to another
section 401 plan or to an IRA. Distributions from a tax-sheltered Annuity may be
rolled over to another tax-sheltered Annuity or to an IRA. Distributions from an
IRA may be rolled over to another IRA and, if the IRA contains only permissible
rollover amounts, to a section 401 plan or a tax-sheltered Annuity.
 
    All distributions, with the exception of a return of nondeductible employee
contributions, received from a section 401, 403(b), 457 plan or IRA are included
in gross income. In the case of section 401, or 403(b) plans and IRAs, a
distribution is includible in the year in which it is paid. In the case of a
section 457 plan, a distribution is includible in the year it is paid or when
made available depending upon whether certain Code requirements are met. In very
limited situations, a lump sum distribution from a section 401 plan may qualify
for special forward income averaging or may qualify for special long term
capital gain treatment.
 
    In addition to the minimum distribution requirements, any payouts under
Section 401 and 403(b) plans and IRAs must meet minimum incidental death benefit
requirements under the Code. This requirement does not apply in the case of
Section 401 plan Participants when the Participant's spouse is the designated
beneficiary. Similar requirements are applicable to Section 457 plans for tax
years beginning after December 31, 1988.
 
    Employers may deduct their contributions to self-employed and corporate
pension and profit-sharing plans described in section 401 of the Code and tax-
sheltered Annuities described in section 403(b) in the year when made, up to the
limits specified in the Code. In addition these plans may permit nondeductible
employee contributions. Any nondeductible employee contribution will be received
tax free as a portion of each annuity payment.
 
NON-QUALIFIED CONTRACTS
 
    Distributions before the Annuity Date are treated as coming first from
earnings, rather than purchase payments, until the entire amount of earnings has
been distributed. For federal tax purposes, distributions include the receipt of
proceeds from loans and the assignment or pledge of any portion of the Contract
Value, as well as withdrawals, income payments, or death benefits. Deferred
annuity contracts issued by an issuer to a policyholder in one calendar year
will be treated as one contract for purposes of determining the tax consequences
of any distribution. Distributions before the Annuity Date are taxable as
ordinary income to the extent that the Contract Value, unreduced by surrender
charges, exceeds Purchase Payments.
 
    Different rules apply to amounts distributed as an Annuity. A portion of
each Annuity payment is treated as a nontaxable return of Purchase Payments. The
remaining portion of each Annuity payment is taxable as ordinary income. The
amount of each Annuity payment which is taxable is based on the period over
which payments are to be made or, in the case of a life Annuity, the life
expectancy of the Annuitant. A lump sum taken in lieu of remaining Annuity
payments will be treated for tax purposes as a withdrawal.
 
   
    Income distributed as an Annuity or as a lump sum withdrawal will be subject
to a 10% excise tax unless the distribution (1) occurs after the taxpayer
attained age 59 1/2, (2) occurs after death or disability of the holder, (3) is
attributable to an investment prior to August 14, 1982, (4) is in the form of an
immediate annuity or (5) is a part of substantially equal payments to be made
over the life or life expectancy of the taxpayer or the taxpayer and his or her
designated beneficiary. The penalty will be imposed if an individual who elected
to receive payments in substantially equal installments as a life or life
expectancy annuity prior to age 59 1/2 changes the method of distribution before
age 59 1/2. This individual will be assessed the penalty even after age 59 1/2
if annuity payments have not continued for five (5) years.
    
 
    Code Section 72(e)(11) provides that multiple annuity contracts which are
issued within a calendar year to the same Contract Owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences.
 
WITHHOLDING
 
   
    Security First Life is required to withhold federal income tax on Annuity
payments, lump sum distributions and partial withdrawals. However, recipients of
Contract distributions are allowed to make an election not to have federal
income tax withheld, except as otherwise described below. After an election is
made with respect to Annuity payments, an Annuitant may revoke the election at
any time, and thereafter commence withholding. Security First Life will notify
the payee at least annually of his or her right to revoke the election.
    
 
    Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10
 
                                       19
<PAGE>   46
 
years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in a direct trustee-to-trustee transfer, no withholding
will be required.
 
    Payees are required by law to provide Security First Life (as payor) with
their correct taxpayer identification number ("TIN"). If the payee is an
individual, the TIN is the same as his or her social security number.
 
   
OBTAINING TAX ADVICE
    
 
   
    It should be recognized that the federal income tax information in this
prospectus is not exhaustive and is for information purposes only. The
discussion above does not purport to cover all situations involving the purchase
of an Annuity or the election of an option under the Contract. Tax results may
vary depending upon individual situations and special rules may apply in certain
cases. State and local tax results may also vary. For these reasons a qualified
tax adviser should be consulted.
    
 
                                 VOTING RIGHTS
 
    Each Owner will have the right to instruct Security First Life with respect
to voting the Fund shares which are the assets underlying his interest in the
Separate Account, at all regular and special shareholders meetings. Security
First Life will mail to each Owner, at his last known address, all periodic
reports and proxy material of the applicable Fund and a form with which to give
voting instructions. Fund shares as to which no timely instructions are received
will be voted by Security First Life in proportion according to the instructions
received from all Owners giving timely instructions. Security First Life is
under no duty to inquire as to the instructions received or the authority of
persons to instruct the voting of Fund shares, and unless Security First Life
has actual knowledge to the contrary, the instructions given to it will be valid
as they affect Security First Life or the Funds.
 
    Once Annuity payments with respect to an Owner's Account have begun, the
Annuitant shall have any voting rights exercisable with respect to the Fund
shares.
 
    The number of votes to be cast by each person having the right to vote shall
be determined as of a record date within 90 days prior to the meeting of the
Fund, and voting instructions will be solicited by written communication at
least 10 days prior to such meeting. To be entitled to vote, an Owner or
Annuitant must have been such on the record date. The number of shares as to
which voting instructions may be given to Security First Life is determined by
dividing that portion of the Contract Value then allocated to the Series for
that Fund on the record date by the net asset value of a Fund share as of the
same date.
 
                               LEGAL PROCEEDINGS
 
    Security First Life, in the ordinary course of its business, is engaged in
litigation of various kinds which in its judgment is not of material importance
in relation to its total assets. There are no present or pending material legal
proceedings affecting the Separate Account.
 
                             ADDITIONAL INFORMATION
 
   
    For further information contact Security First Life at the address and phone
number on the cover of this Prospectus. A copy of the Statement of Additional
Information, dated May 1, 1996, which provides more detailed information about
the Contracts, may also be obtained. Set forth below is the table of contents
for the Statement of Additional Information.
    
 
    A registration statement has been filed with the SEC under the Securities
Act of 1933 with respect to the Contracts offered hereby. This Prospectus does
not contain all the information set forth in the registration statement, to all
of which reference is made for further information concerning the Separate
Account, Security First Life and the Contracts offered hereby. Statements
contained in this Prospectus as to the contents of the Contracts and other legal
instruments are summaries. For a complete statement of the terms thereof
reference is made to such instruments as filed.
 
                                       20
<PAGE>   47
 
            TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION
 
   
<TABLE>
<CAPTION>
                                                                                                  PAGE
<S>                                                                                              <C>
The Insurance Company............................................................................    3
The Separate Account.............................................................................    3
The Funds........................................................................................    3
Purchase of Securities Being Offered.............................................................    5
Net Investment Factor............................................................................    6
Annuity Payments.................................................................................    6
Withholding on Annuity Payments and Other Distributions..........................................    8
Underwriters, Distribution of the Contracts......................................................    8
Calculation of Performance Data..................................................................    9
Voting Rights....................................................................................   10
Safekeeping of the Securities....................................................................   10
Servicing Agent..................................................................................   10
Independent Auditors.............................................................................   10
Legal Matters....................................................................................   10
State Regulation of Security First Life..........................................................   10
Financial Statements.............................................................................   11
</TABLE>
    
 
                                       21
<PAGE>   48
 
                     SECURITY FIRST LIFE SEPARATE ACCOUNT A
- --------------------------------------------------------------------------------
 
                          INDIVIDUAL FLEXIBLE PAYMENT
                           VARIABLE ANNUITY CONTRACTS
 
                     Security First Life Insurance Company
                          11365 West Olympic Boulevard
                         Los Angeles, California 90064
- --------------------------------------------------------------------------------
 
The individual flexible payment Variable Annuity Contracts (the "Contracts")
described in this Prospectus are issued by Security First Life Insurance Company
("Security First Life"). The Contracts may be issued pursuant to retirement
plans that do not qualify for special tax treatment under the Internal Revenue
Code of 1986 (the "Code"). The Contracts may also be issued to plans that
qualify for special tax treatment such as individual retirement annuities, tax-
sheltered annuities, Section 457 deferred compensation plans and pension plans.
 
   
Eight Funds constitute the underlying investment medium for the Contracts: (i)
the Virtus Equity Series (formerly Value Equity Series) and Virtus U.S.
Government Income Series (formerly U.S. Government Income Series) of Security
First Trust, (ii) the Money Market Portfolio, Growth Portfolio and Overseas
Portfolio of the Variable Insurance Products Fund, (iii) the Contrafund
Portfolio of the Variable Insurance Products Fund II, (iv) the International
Portfolio of the Scudder Variable Life Investment Fund and (v) the Small
Capitalization Portfolio of The Alger American Fund.
    
 
   
This Prospectus sets forth information a prospective investor should know before
investing. Additional information about the Contracts has been filed with the
Securities and Exchange Commission ("SEC") in a Statement of Additional
Information, dated May 1, 1996, which information is incorporated herein by
reference and is available without charge upon written request to Security First
Life Insurance Company, P.O. Box 92193, Los Angeles, California 90009 or by
telephoning 1(800)284-4536.
    
 
The table of contents of the Statement of Additional Information appears on page
20 of the Prospectus.
- --------------------------------------------------------------------------------
 
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING OF SHARES OF ANY UNDERLYING FUND
FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN RECEIVED AND IN NO EVENT WILL
DESIGNATION OF AN UNDERLYING FUND FOR WHICH A CURRENT PROSPECTUS HAS NOT BEEN
RECEIVED BE PERMITTED UNLESS THE OWNER RECEIVES SUCH A PROSPECTUS.
 
PLEASE READ AND RETAIN THIS PROSPECTUS FOR FUTURE REFERENCE.
- --------------------------------------------------------------------------------
 
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 THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
 
   
                                IMPORTANT NOTICE
    
 
   
ANNUITIES, MUTUAL FUNDS, AND OTHER INVESTMENTS ARE NOT INSURED BY THE FDIC OR
ANY OTHER GOVERNMENT AGENCY. THEY ARE NOT DEPOSITS, OBLIGATIONS, OR GUARANTEED
BY ANY BANK. THEY INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL AMOUNT INVESTED.
    
- --------------------------------------------------------------------------------
 
   
Prospectus dated May 1, 1996                                   SF 135 R2V (5/96)
    
<PAGE>   49
 
                               TABLE OF CONTENTS
 
   
<TABLE>
<CAPTION>
                                                                                                 PAGE
                                                                                                 ----
<S>                                                                                              <C>
Glossary.......................................................................................    3
Summary of the Contracts.......................................................................    4
Fee Tables.....................................................................................    6
Condensed Financial Information................................................................    8
Performance....................................................................................    8
Financial Information..........................................................................    8
Description of Security First Life Insurance Company,
  The General Account, The Separate Account and The Funds......................................    9
    The Insurance Company......................................................................    8
    The Separate Account.......................................................................    8
    The Funds..................................................................................    9
Principal Underwriter..........................................................................   10
Servicing Agent................................................................................   10
Custody of Securities..........................................................................   10
Contract Charges...............................................................................   11
    Premium Taxes..............................................................................   11
    No Sales Charge............................................................................   11
    Administration Fees........................................................................   11
    Mortality Risk and Administrative Expense Risk Charge......................................   11
    10-Day Free Look...........................................................................   11
Description of the Contracts...................................................................   12
    Assignment.................................................................................   12
    Purchase Payments..........................................................................   12
    Conversions................................................................................   12
    Dollar Cost Averaging......................................................................   12
    Reallocation Election......................................................................   12
    Modification of the Contracts..............................................................   12
Accumulation Period............................................................................   13
    Crediting Accumulation Units in the Separate Account.......................................   13
    Separate Account Accumulation Unit Current Values..........................................   13
    Net Investment Factor......................................................................   13
    Surrender from the Separate Account........................................................   13
    Statement of Account.......................................................................   13
Annuity Benefits...............................................................................   14
    Variable Annuity Payments..................................................................   14
    Assumed Investment Return..................................................................   14
    Election of Annuity Date and Form of Annuity...............................................   14
    Frequency of Payment.......................................................................   15
    Level Payments Varying Annually............................................................   15
    Annuity Unit Values........................................................................   16
Death Benefits.................................................................................   16
    Death Before the Annuity Date..............................................................   16
    Death After the Annuity Date...............................................................   16
Federal Income Tax Status......................................................................   17
    Qualified Contracts........................................................................   17
    Non-Qualified Contracts....................................................................   18
    Withholding................................................................................   18
    Obtaining Tax Advice.......................................................................   18
Voting Rights..................................................................................   19
Legal Proceedings..............................................................................   19
Additional Information.........................................................................   19
Table of Contents of Statement of Additional Information.......................................   19
</TABLE>
    
 
- --------------------------------------------------------------------------------
 
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus in connection with
the offer described herein and, if given or made, such information or
representations must not be relied upon as having been authorized. This
Prospectus does not constitute an offer in any jurisdiction to any person to
whom such offer would be unlawful therein.
 
                                        2
<PAGE>   50
 
                                    GLOSSARY
 
As used in this Prospectus, these terms have the following meanings:
 
ACCUMULATION UNIT -- A measuring unit used to determine the value of an Owner's
interest in a Separate Account Series under a Contract at any time before
Annuity Payments commence.
 
ANNUITANT -- The person on whose life Annuity payments under a Contract are
based.
 
ANNUITY -- A series of income payments made to an Annuitant for a defined period
of time.
 
ANNUITY DATE -- The date on which Annuity payments begin.
 
ANNUITY UNIT -- A measuring unit used to determine the amount of Variable
Annuity payments based on a Separate Account Series under a Contract after such
payments have commenced.
 
ASSUMED INVESTMENT RETURN -- The investment rate selected by the Annuitant for
use in determining the Variable Annuity payments.
 
BENEFICIARY -- The person who has the right to a Death Benefit upon the death of
the Owner.
 
   
BUSINESS DAY -- Each Monday through Friday except for days the New York Stock
Exchange is not open for trading.
    
 
CONTRACT -- The agreement between Security First Life and the Contract Owner
covering the rights of the Owner.
 
CONTRACT DATE -- The date an Owner's Contract is issued.
 
CONTRACT VALUE -- The sum of the Owner's interest in the Separate Account
Series. The Owner's interest in the Separate Account Series is the sum of the
values of the Accumulation Units.
 
CONTRACT YEAR -- A 12-month period starting on the Contract Date and on each
anniversary thereof.
 
FIXED ANNUITY -- An Annuity providing guaranteed level payments. Such payments
are not based upon the investment experience of the Separate Account.
 
FUND -- A diversified, open-end management investment company, or series
thereof, registered under the Investment Company Act of 1940 ("1940 Act") which
serves as the underlying investment medium for a Series in the Separate Account.
 
GENERAL ACCOUNT -- All assets of Security First Life other than those in the
Separate Account or any of its other segregated asset accounts.
 
NORMAL ANNUITY DATE -- The first day of the month coincident with or next
following the anniversary of the Contract Date nearest the Annuitant's 85th
birthday, or the 10th anniversary, if later.
 
OWNER -- The person who has title to the Contract.
 
PURCHASE PAYMENT -- The amounts paid to Security First Life in order to provide
benefits under the Contract.
 
SEPARATE ACCOUNT -- The segregated asset account entitled "Security First Life
Separate Account A" which has been established by Security First Life pursuant
to Delaware law to receive and invest amounts allocated and to provide Variable
Annuity benefits under the Contracts. The Separate Account is registered as a
unit investment trust under the 1940 Act.
 
SERIES -- The Accumulation Unit values and Annuity Unit values maintained
separately for each Fund whose securities are owned by the Separate Account.
 
VALUATION DATE -- Any Business Day used by the Separate Account to determine the
value of part or all of its assets for purposes of determining Accumulation and
Annuity Unit values for the Contract. Accumulation Unit values will be
determined each Business Day. There will be one Valuation Date in each calendar
week for Annuity Unit values. Security First Life will establish the Valuation
Date at its discretion, but until notice to the contrary is given, that date
will be the last Business Day in a week.
 
                                        3
<PAGE>   51
 
VALUATION PERIOD -- The period of time from one Valuation Date through the next
Valuation Date.
 
VARIABLE ANNUITY -- An Annuity providing payments which will vary annually in
accordance with the net investment experience of the applicable Separate Account
Series.
 
                            SUMMARY OF THE CONTRACTS
 
THE CONTRACTS
 
    The Contracts may be issued pursuant to retirement plans that do not qualify
for special tax treatment ("Non-Qualified Contracts") and to individuals seeking
to accumulate funds for retirement whether or not such individuals are otherwise
participating in qualified or non-qualified retirement plans (See "Non-Qualified
Contracts," page 18). The Contracts may also be issued to plans qualifying for
special tax treatment ("Qualified Contracts"), such as individual retirement
annuities, Section 403(b) tax-sheltered annuities, Section 457 deferred
compensation plans, money purchase pension plans and profit sharing plans. (See
"Qualified Contracts," page 18.)
 
PURCHASE PAYMENTS
 
    Purchase Payments under the Contracts are made to the Separate Account and
allocated among the Series as directed by the Owner, provided that purchase
payments of $100,000 or more will be initially allocated to the Money Market
Portfolio until the end of the applicable 10 day free look period. The minimum
initial Purchase Payment is $1,000 and each additional Purchase Payment must be
at least $100. There is no sales charge; however, certain charges and deductions
will be made to the Contract Value. (See "Contract Charges," page 12.) Amounts
allocated to the Separate Account may be transferred among the Series at any
time and any number of times. (See "Conversions," page 13.)
 
SEPARATE ACCOUNT
 
   
    Pursuant to the Participant's designation, Purchase Payments allocated to
the Separate Account are invested at net asset value in Accumulation Units of
one or more of eight series, each of which consists of the shares of a different
Fund. The Funds presently consist of the Virtus Equity Series and Virtus U.S.
Government Income Series of the Security First Trust, the Money Market
Portfolio, Growth Portfolio and Overseas Portfolio of the Variable Insurance
Products Fund, the Contrafund Portfolio of the Variable Insurance Products Fund
II, the International Portfolio of the Scudder Variable Life Investment Fund and
the Small Capitalization Portfolio of The Alger American Fund. The investment
adviser and manager of Security First Trust is Security First Investment
Management Corporation ("Security Management"). Virtus Capital Management, Inc.
("Virtus") is the subadvisor for the Virtus Equity Series and Virtus U.S.
Government Income Series of Security First Trust. The investment adviser of the
Variable Insurance Products Fund and the Variable Insurance Products Fund II is
Fidelity Management & Research Company ("FMR"). The investment advisor and
manager of the Scudder Variable Life Investments Fund is Scudder, Stevens &
Clark, Inc. ("Scudder"). The Small Capitalization Portfolio of The Alger
American Fund is managed and advised by Fred Alger Management, Inc. ("Alger
Management"). (See "The Separate Account," page 10 and "The Funds," page 10.)
    
 
CHARGES AND DEDUCTIONS
 
    No sales charge is deducted from any purchase payment under the Contract or
any amount surrendered under the Contract.
 
    An administration fee will be deducted daily from the Owner's interest in
the Separate Account in the amount of .000411% (.15% per annum). (See
"Administration Fees," page 12.)
 
    Daily deductions will be made for mortality risks in the amount of .002192%
(.80% per annum) and for administrative expense risks in the amount of .001233%
(.45% per annum). (See "Mortality Risk and Administrative Expense Risk Charge,"
page 12.)
 
    Premium taxes payable to any state or other governmental agency with respect
to the Owner's Account may be deducted on or after the date they were incurred.
Premium taxes currently range from 0% to 2.35% (3.50% in Nevada). Until further
notice, Security First Life will deduct premium taxes upon annuitization. (See
"Premium Taxes," page 12.)
 
                                        4
<PAGE>   52
 
   
FREE LOOK PERIOD
    
 
   
    At any time within ten days (or such longer period as required by state law)
after the receipt of the Contract it may be returned for cancellation and a full
refund of all Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. (See "Free Look Period," page 11).
    
 
VARIABLE ANNUITY PAYMENTS
 
    Monthly Annuity payments will start on the Annuity Date. The Owner selects
the Annuity Date, an Annuity payment option, and an assumed investment return.
Any of these selections may be changed prior to the Annuity Date. The Variable
Annuity payment will vary annually based on a comparison of the assumed
investment returns with the investment experience of the Series in which the
Contract Value is invested. (See "Variable Annuity Payments," page 15.)
 
    If Annuity payments from any one Series would be less than $50, Security
First Life reserves the right to change the frequency of the payments from that
Series to such intervals as will result in payments of at least $50 from each
Series. (See "Frequency of Payment," page 16.)
 
SURRENDER
 
    An Owner may surrender, before the Annuity Date, all or part of his or her
Contract Value. However, no partial surrender is permitted if it would reduce
the Owner's interest in any Series to less than $500, unless the entire amount
allocated to that Series is being surrendered. The earnings surrendered will be
taxed as ordinary income and may be subject to a penalty tax under the Code.
(See "Federal Income Tax Status," page 18.) Certain restrictions are applicable
to surrender from Contracts funding retirement plans qualified for special tax
treatment under the Code. (See "Qualified Contracts," page 18.)
 
DEATH BENEFIT
 
    Unless otherwise restricted, in the event of the Owner's death prior to the
Annuity Date, the designated Beneficiary may elect either to receive a death
benefit in a lump sum or to apply the death benefit under certain of the
available optional Annuity forms contained in the Contract. The death benefit is
the greater of: (i) Purchase Payments reduced by amounts applied to partial
withdrawals or annuity income or (ii) the Contract Value at settlement (see
"Death Benefits," page 17).
 
                                        5
<PAGE>   53
 
                                   FEE TABLES
 
                        PARTICIPANT TRANSACTION EXPENSES
 
                                      None
 
                           SEPARATE ACCOUNT EXPENSES
                  (DEDUCTED DAILY FROM THE SEPARATE ACCOUNT.)
 
  Administration fees                                            0.15% per annum
 
  Mortality and Expense Risk Fees                                1.25% per annum
 
  Total Separate Account Annual Fees                             1.40% per annum
 
                              FUND ANNUAL EXPENSES
                    (AS A PERCENTAGE OF AVERAGE NET ASSETS)
                             (NET OF REIMBURSEMENT)
 
   
<TABLE>
<CAPTION>
                                          Virtus         Virtus
                                           Value        U.S. Gov.      Money
                                          Equity         Income       Market       Growth      Overseas    Contrafund
                                          Series         Series      Portfolio    Portfolio    Portfolio   Portfolio
                                       -------------    ---------    ---------    ---------    --------    ----------
  <S>                                  <C>              <C>          <C>          <C>          <C>         <C>
  (a) Management Fee................       0.34%          0.22%        0.24%        0.61%        0.76%      0.61%
  (b) Other Expenses................       0.66%          0.48%        0.09%        0.09%        0.15%        0.11%
  (c) Total Annual Expenses.........       1.00%          0.70%        0.33%        0.70%        0.91%        0.72%
</TABLE>
    
 
   
<TABLE>
<CAPTION>
                                                          Small
                                       International      Cap.
                                         Portfolio      Portfolio
                                       -------------    ---------
  <S>                                  <C>              <C>          <C>          <C>          <C>         <C>
  (a) Management Fee................       0.88%          0.85%
  (b) Other Expenses................       0.20%          0.07%
  (c) Total Annual Expenses.........       1.08%          0.92%
</TABLE>
    
 
                                        6
<PAGE>   54
 
EXAMPLES
 
   
<TABLE>
<CAPTION>
                                     CONDITIONS
   SEPARATE      A PARTICIPANT WOULD PAY THE FOLLOWING EXPENSES ON                 TIME PERIODS
    ACCOUNT       A $1,000 INVESTMENT ASSUMING 5% ANNUAL RETURN ON      ----------------------------------
    SERIES                            ASSETS:                           1 YEAR  3 YEARS  5 YEARS  10 YEARS
- ---------------  --------------------------------------------------     ------  -------  -------  --------
<S>              <C>                                                <C> <C>     <C>      <C>      <C>
Virtus           (a) upon surrender at the end of the stated time   (a)  $ 24    $  74    $ 126     $270
Equity               period
Series           (b) if the Certificate WAS NOT surrendered or was  (b)    24       74      126      270
                     annuitized
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Virtus U.S.      SAME                                               (a)    21       65      111      240
Gov. Income
Series
                                                                    (b)    21       65      111      240
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Money            SAME                                               (a)    17       54       92      201
Market
Portfolio                                                           (b)    17       54       92      201
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Growth           SAME                                               (a)    21       65      111      240
Portfolio
Series
                                                                    (b)    21       65      111      240
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Overseas         SAME                                               (a)    23       71      122      261
Portfolio
Series
                                                                    (b)    23       71      122      261
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Contrafund       SAME                                               (a)    21       65      112      242
Portfolio
                                                                    (b)    21       65      112      242
- ---------------  --------------------------------------------------     ------  -------  -------  --------
International    SAME                                               (a)    25       76      130      278
Portfolio
                                                                    (b)    25       76      130      278
- ---------------  --------------------------------------------------     ------  -------  -------  --------
Small            SAME                                               (a)    23       71      122      262
Capitalization
Portfolio
                                                                    (b)    23       71      122      262
- ---------------  --------------------------------------------------     ------  -------  -------  --------
</TABLE>
    
 
                     EXPLANATION OF FEE TABLE AND EXAMPLES
 
1. The purpose of the foregoing tables and examples is to assist the Owner in
   understanding the various costs and expenses that he or she will bear
   directly or indirectly. The table reflects expenses of the Separate Account
   as well as the underlying Funds. For additional information see "Contract
   Charges," beginning on page 12.
 
   
2. The investment advisers to the Virtus Equity Series and the Virtus U.S.
   Government Income Series voluntarily reimbursed certain expenses of these
   Funds. If there had been no reimbursement, total expenses would have been
   1.71% and 1.49%, respectively (see the Security First Trust prospectuses for
   more information).
    
 
3. Premium taxes are not reflected. Presently, premium taxes ranging from 0% to
   2.35% (3.50% in Nevada) may be deducted from each Purchase Payment or upon
   annuitization. However, Security First Life presently deducts premium tax
   only from amounts annuitized.
 
4. NEITHER THE TABLE NOR THE EXAMPLES ARE REPRESENTATIONS OF PAST OR FUTURE
   EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
 
                                        7
<PAGE>   55
 
                          CONDENSED FINANCIAL INFORMATION
 
   
    As of the date of this Prospectus, no units had been issued under the
Contracts described in this Prospectus. As a result, no Condensed Financial
Information table has been provided.
    
 
                                  PERFORMANCE
 
    Security First Life may from time to time advertise the yield and effective
yield on the Money Market Portfolio of the Separate Account and the average
annual total returns for the other Funds in the Separate Account. Yields and
average annual total returns are determined in accordance with the methods of
computation set forth by the SEC in the Form N-4 Registration Statement and are
more particularly described in the Statement of Additional Information. Yields
are expressed for a seven day period, and average annual total returns are
expressed for at least one, five and ten year periods (or from inception if
shorter).
 
   
    The yields of the Money Market Portfolio are determined based upon the
change in the value of an outstanding unit in the Separate Account over a seven
day period and annualizing the result. The computation takes into account
recurring deductions from account values.
    
 
    The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.
 
                             FINANCIAL INFORMATION
 
    Financial Statements of the Separate Account and Security First Life are
contained in the Statement of Additional Information.
 
             DESCRIPTION OF SECURITY FIRST LIFE INSURANCE COMPANY,
            THE GENERAL ACCOUNT, THE SEPARATE ACCOUNT AND THE FUNDS
 
THE INSURANCE COMPANY
 
   
    Security First Life is a stock life insurance company founded in 1960 and
organized under the laws of the State of Delaware. Its principal executive
offices are located at 11365 West Olympic Boulevard, Los Angeles, California
90064. Security First Life owns all of the outstanding stock of Fidelity
Standard Life Insurance Company. Security First Life is a wholly-owned
subsidiary of Security First Group, Inc. ("SFG") (formerly The Holden Group,
Inc.). The outstanding voting stock of SFG is owned by London Insurance Group,
Inc., a Canadian insurance service corporation and publicly traded subsidiary of
the Trilon Corporation of Toronto, Canada. Security First Life is authorized to
transact the business of life insurance, including annuities. Security First
Life presently is licensed to do business in 49 states and the District of
Columbia.
    
 
THE SEPARATE ACCOUNT
 
    The Separate Account was established by Security First Life on May 29, 1980,
in accordance with the provisions of the Delaware Insurance Code. It is
registered as a unit investment trust under the 1940 Act. Registration with the
SEC does not involve supervision by the SEC of the management or investment
practices or policies of the Separate Account or Security First Life.
 
    The Separate Account and each Series therein are administered and accounted
for as part of the general business of Security First Life, but the income and
realized capital gains or losses of each Series are credited to or charged
against the assets held for that Series in accordance with the terms of the
Contracts. This is done without regard to the income, realized capital gains or
losses of any other Series or the experience of Security First Life in any other
business it may conduct. The assets within each Series are not chargeable with
liabilities incurred by any other Series, or arising out of any other business
Security First Life may conduct.
 
    All obligations arising under the Contracts, including the guarantee to make
annuity payments, are general corporate obligations of Security First Life, and
all of Security First Life's assets are available to meet its expenses and
obligations under the Contracts. However, while Security First Life is obligated
to make the Variable Annuity payments under the Contracts, the amount of such
payments is guaranteed only to the extent of the level amount calculated at the
beginning of each Annuity year. (See "Level Payments Varying Annually," page
16.)
 
    The Separate Account is divided into a number of Series of Accumulation and
Annuity Units, eight of which are available under the Contracts, and each Series
invests in the shares of only one of the Funds. The Funds consist of
 
                                        8
<PAGE>   56
 
   
(i) the Virtus Equity Series and Virtus U.S. Government Income Series of the
Security First Trust, (ii) the Money Market Portfolio, Growth Portfolio and
Overseas Portfolio of the Variable Insurance Products Fund, (iii) the Contrafund
Portfolio of the Variable Insurance Products Fund II, (iv) the International
Portfolio of the Scudder Variable Life Investment Fund, and (v) the Small
Capitalization Portfolio of The Alger American Fund. The shares of each Fund are
purchased, without sales charge, for the corresponding Series at the net asset
value per share next determined by each Fund following receipt of the applicable
payment. Any dividend or capital gain distributions received from a Fund are
reinvested in Fund shares which are retained as assets of the applicable Series.
Fund shares will be redeemed without fee to the Series to the extent necessary
for Security First Life to make Annuity or other payments under the Contracts.
    
 
    If shares of any Fund should no longer be available for investment by a
Series or if in the judgment of Security First Life's management further
investment in the shares of any fund should become inappropriate in view of the
purposes of the Contracts issued, Security First Life may substitute for the
Fund shares already purchased, and apply future Purchase Payments under the
Contracts to the purchase of shares of another Fund or other securities. No
substitution of securities of any Series may take place, however, without a
prior favorable vote of a majority of the Owners entitled to vote who have
invested in the Series and the prior approval of the SEC.
 
THE FUNDS
 
    Each of the Funds is a series or portfolio of an open-end management
investment company registered with the SEC under the 1940 Act. Registration does
not involve supervision by the SEC of the investments or investment policies of
the Funds. There can be no assurance that the investment objectives of the Funds
will be achieved.
 
    The Security First Trust is a Massachusetts business trust which has a
number of series, two of which are available under the Contracts.
 
   
    Virtus Equity Series (formerly Value Equity Series) seeks to provide growth
of capital and income. The Series pursues this objective by investing in common
stocks of high quality companies. The Series is managed to take advantage of
trends in the stock market that favor different styles of stock selection (value
or growth) and different sizes of companies (consisting of large, medium and
small).
    
 
   
    Virtus U.S. Government Income Series (formerly U.S. Government Income
Series) seeks to provide current income. The Series pursues this objective by
investing in a professionally managed, diversified portfolio limited primarily
to U.S. government securities.
    
 
   
    Security Management, a subsidiary of SFG and an affiliate of Security First
Life and Security First Financial, Inc., provides investment advice and
management services to the two series of Security First Trust described above.
Under a subadvisory agreement with Security Management, Virtus provides
investment management services to the Virtus Equity Series and Virtus U.S.
Government Income Series.
    
 
    Variable Insurance Products Fund and Variable Insurance Products Fund II are
Massachusetts business trusts. Each is divided into separate portfolios. The
following portfolios from these trusts are available under the Contracts:
 
    Money Market Portfolio seeks to obtain as high a level of current income as
is consistent with preserving capital and providing liquidity. The portfolio
will invest only in high quality U.S. dollar denominated money market securities
of domestic and foreign issuers.
 
    Growth Portfolio seeks to achieve capital appreciation normally through the
purchase of common stocks (although the portfolio's investments are not
restricted to any one type of security). Capital appreciation may also be found
in other types of securities, including bonds and preferred stocks.
 
    Overseas Portfolio seeks long-term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.
 
    Contrafund Portfolio seeks capital appreciation by investing in equity or
debt securities of companies that the investment adviser believes to be
undervalued due to an overly pessimistic appraisal by the public.
 
    FMR is the investment adviser to each of the portfolios of the Variable
Insurance Products Fund and the Variable Insurance Products Fund II.
 
    Scudder Variable Life Investment Fund is a Massachusetts business trust
which is divided into separate Portfolios. The following Portfolio is available
under the Contracts.
 
                                        9
<PAGE>   57
 
    International Portfolio seeks long-term growth of capital primarily through
diversified holdings of marketable foreign equity investments. The Portfolio
invests in companies, wherever organized, which do business primarily outside
the United States. The Portfolio intends to diversify investments among several
countries and to have represented in its holdings business activities in not
less than three different countries. The Portfolio does not intend to
concentrate investments in any particular industry.
 
    The investment advisor of the Scudder Variable Life Investment Fund is
Scudder.
 
    The Alger American Fund is a Massachusetts business trust which has a number
of portfolios, one of which is available under the Contracts.
 
    Small Capitalization Portfolio seeks long-term capital appreciation by
investing in a diversified, actively managed portfolio of equity securities,
primarily of companies with total market capitalization of less than $1 billion.
Income is a consideration in the selection of investments but is not an
investment objective of the Portfolio.
 
    The investment adviser of The Alger American Fund is Alger Management.
 
    The Funds are available to registered separate accounts offering variable
annuity and variable life products of participating insurance companies and to
other entities permitted under Section 817(h) of the Code. Although it is not
anticipated that any disadvantages will result, there is a possibility that a
material conflict may arise between the interest of the Separate Account and one
or more of the other separate accounts participating in the Funds. A conflict
may occur due to a change in law affecting the operations of variable life and
variable annuity separate accounts, differences in the voting instructions of
our Owners and those of other companies, or some other reason. In the event of a
conflict, the Separate Account will take any steps necessary to protect Owners
and variable annuity payees, which may include withdrawal of amounts invested in
the Fund by the Separate Account.
 
    The rights of Participants or Beneficiaries to instruct Security First Life
on voting shares of the Funds are described under "Voting Rights," page 19.
 
    Detailed information about the Funds, their investment objectives,
investment portfolios and charges may be found in the prospectuses of the Funds.
Delivery of prospectuses of the Funds must precede or accompany delivery of this
prospectus. An investor should carefully read the Funds' prospectuses before
investing. Prospectuses for Security First Trust, Variable Insurance Products
Fund, Variable Insurance Products Fund II, Scudder Variable Life Investment Fund
and The Alger American Fund may be obtained without charge by written request to
Security First Life Insurance Company, P.O. Box 92193, Los Angeles, California
90009.
 
                             PRINCIPAL UNDERWRITER
 
    Security First Financial, Inc., 11365 West Olympic Boulevard, Los Angeles,
California 90064, a broker-dealer registered under the Securities Exchange Act
of 1934 and a member of the National Association of Securities Dealers, Inc., is
the principal underwriter for the Contracts. Security First Financial, Inc., is
a Delaware corporation and a subsidiary of SFG.
 
                                SERVICING AGENT
 
    Security First Life receives certain administrative services such as office
space, supplies, utilities, office equipment, travel expenses and periodic
reports pursuant to an agreement with SFG.
 
                             CUSTODY OF SECURITIES
 
    The custodian of the assets of the Separate Account is Security First Life.
The assets of each Series will be kept physically segregated by Security First
Life and held separate from the assets of the other Series and of any other
firm, person, or corporation. Additional protection for the assets of the
Separate Account is afforded by fidelity bonds covering all of Security First
Life's officers and employees.
 
                                CONTRACT CHARGES
 
   
    Contract charges are assessed as follows: (i) for premium taxes; (ii)
against the net value of assets in the Separate Account on a daily basis for
administration of the Contract; and (iii) against the value of the assets in the
    
 
                                       10
<PAGE>   58
 
   
Separate Account on a daily basis, for the assumption of mortality risks and
administrative expense risks. These charges may not be changed under the
Contract, and Security First Life may profit from these charges in the
aggregate.
    
 
    An investor should note that there are deductions from and expenses paid out
of the assets of the Funds that are described in their respective prospectuses.
 
PREMIUM TAXES
 
    Certain state and governmental entities impose a premium tax of up to 2.35%
(3.50% in Nevada) of Purchase Payments or amounts applied to an Annuity option.
The Contracts permit Security First Life to deduct any applicable premium taxes
from the Contract Value at or after the time they are incurred. Until further
notice, Security First Life will deduct any premium tax only from amounts
applied to an Annuity option.
 
NO SALES CHARGE
 
    Security Life has waived all sales charges under the Contract. As a result,
there are no sales loads on purchase payments and no surrender charges on full
or partial surrenders.
 
ADMINISTRATION FEES
 
    An administration fee of .000411% (.15% per annum) is deducted from the
Owner's interest in the Separate Account on a daily basis. Contract
administration expenses include the cost of policy issuance; salaries; rent;
postage; telephone and travel expenses; legal, administrative, actuarial and
accounting fees; periodic reports; office equipment; stationery; office space;
and custodial expenses. These fees will not exceed the cost of providing such
administration services.
 
MORTALITY RISK AND ADMINISTRATIVE EXPENSE RISK CHARGE
 
    The minimum death benefit provided for by the Contracts requires Security
First Life to assume a mortality risk that the Contract Value will be less than
the Owner's Purchase Payments adjusted for prior withdrawals and/or amounts
applied to Annuity options. (See "Death Before the Annuity Date," page 17.) In
addition, because the Contracts provide life Annuity options, Security First
Life assumes a mortality risk that the death rate of Annuitants as a group will
be lower than the death rate upon which the mortality tables specified in the
Contracts are based. A fee will be charged by Security First Life to compensate
it for assuming these mortality risks in connection with amounts allocated to
the Separate Account. Security First Life will make a daily deduction from the
Separate Account for mortality risks equal to .80% on an annual basis of the
Separate Account assets funding the Contracts.
 
    Although Security First Life charges an administration fee equal to 0.15%
per annum from the value of Separate Account assets funding the Contract, there
is no assurance that these fees will be sufficient to absorb the administrative
expenses incurred by Security First Life during the term of the Contract. As
compensation for assuming the risk that administrative expenses will exceed such
fees, Security First Life will make a daily deduction from the value of the
Separate Account assets funding the Contracts equal to .45% on an annual basis.
 
    If Security First Life has gains from the receipt of the mortality and
expense risk charges over its costs of assuming these risks under the Contracts,
it may use the gains in its discretion, including reduction of expenses incurred
in distributing the Contracts.
 
    Security First Life may, in its discretion, voluntarily waive a portion of
the mortality and administrative expense risk charges, which waiver may be
terminated at any time.
 
   
FREE LOOK PERIOD
    
 
   
    The Contract provides for an initial "Free Look" period. The Owner has the
right to return the Contract within 10 days (or such longer period as required
by state law) after the Owner receives the Contract by delivering or mailing it
to Security First Life at its administrative office. If the Contract is mailed,
it will be deemed mailed on the date of the postmark or, if sent by certified or
registered mail, the date of certification or registration. The returned
Contract will be treated as if the Company never issued it, and the Company will
refund the Purchase Payments or, if required by state law, the greater of the
Purchase Payments or the account value. Effective on and after June 1, 1996,
Purchase Payments contributed to the Separate Account will be allocated to the
Money Market Portfolio for the number of days of the Free Look period required
by the state. At the end of the Free Look period, the account value in the Money
Market Portfolio will be reallocated to the series of the Separate Account
selected in the application.
    
 
                                       11
<PAGE>   59
 
                          DESCRIPTION OF THE CONTRACTS
 
ASSIGNMENT
 
    The Contracts provide that an Owner may freely assign his or her rights
under them. However, the Code provides that Contracts issued in connection with
Section 401 or 403 plans and IRAs must be nontransferable and nonassignable.
 
PURCHASE PAYMENTS
 
    Purchase Payments may be made at any time. The minimum initial Purchase
Payment is $1,000; with each additional Purchase Payment subject to a $100
minimum. Confirmation of each Purchase Payment received will be sent to the
Owner.
 
CONVERSIONS
 
    Accumulation Units may be converted among the Series at any time. Conversion
instructions may be communicated in writing or, if permitted by Security First
Life, by telephone. If telephone conversions of Accumulation Units are
permitted, the Owner will be required to complete an authorization on the
Contract application or on another form provided by Security First Life.
Security First Life will employ reasonable procedures to confirm that telephone
instructions are genuine (including requiring one or more forms of personal
identification), and Security First Life will not be liable for following
instructions it reasonably believes to be genuine.
 
    Accumulation Units will be converted on the first valuation after receipt of
written or telephone instructions. Because Accumulation Unit values are
determined at the close of the New York Stock Exchange (currently 4:00 P.M.
Eastern Time) on a Valuation Date, conversion instructions received up to that
time will be effected at the value calculated on that Date and instructions
received after that time will be effected at the value next calculated.
 
    Annuity Units may be converted among the Series at any time. Conversions
described in this paragraph may be elected in writing only and will be effective
on the first valuation following receipt of the instructions. Except as
permitted under a dollar cost averaging program or a reallocation election, a
minimum of $500 must be converted from any Series.
 
DOLLAR COST AVERAGING
 
    Security First Life offers a program for dollar cost averaging in which
Owners with Contract Values of $5,000 or more may participate. The program will
periodically convert Accumulation Units from the Series invested in the Money
Market Portfolio of the Variable Insurance Products Fund to any of the other
Series selected by the Owner. The program allows the Owner to invest in
non-money market Series over any period selected by the Owner rather than
investing in those Series all at once. Conversions may be made monthly,
quarterly, semi-annually or annually in a minimum amount of $100, and Security
First Life reserves the right to limit the number of Series to which conversions
can be made (but there are not current limitations). An Owner may terminate the
program at any time on written notice to Security First Life.
 
REALLOCATION ELECTION
 
    An Owner with a Contract Value of $5,000 or more may elect in writing on a
form provided by Security First Life to systematically reallocate values
invested in Accumulation Units among the Series in order to achieve an
allocation ratio established by the Owner. Conversions will be made annually on
the third business day of the month in which the anniversary of the Contract
Date occurs. Changes in allocation ratios can be made once each Contract Year.
 
MODIFICATION OF THE CONTRACTS
 
   
    The Contracts include Security First Life's assurance that Annuity payments
involving life contingencies will be based on the minimum guaranteed Annuity
purchase rates incorporated in the Contracts, regardless of actual mortality
experience. The Contracts include provisions legally binding on Security First
Life with respect to these Annuity purchase rates and such other matters as
death benefits, deductions from Purchase Payments, deductions from the Separate
Account for mortality risk and administrative expense risk fees, and guaranteed
rates with respect to fixed benefits. Security First Life may unilaterally
change such provisions, but only: (i) with respect to any Purchase Payments
received as a tax free exchange under the Code after the effective date of the
change; (ii) with respect to benefits and values provided by Purchase Payments
made after the effective date of the change to the extent that such
    
 
                                       12
<PAGE>   60
 
Purchase Payments in any Contract Year exceed the first year's Purchase
Payments; or (iii) to the extent necessary to conform the Contract to any
Federal or state law, regulation or ruling.
 
    A Contract may also be modified by written agreement between Security First
Life and the Owner.
 
    Inquiries as to any Contract provisions should be made in writing to
Security First Life Insurance Company, P.O. Box 92193, Los Angeles, California
90009 or by telephoning 1(800)284-4536.
 
                              ACCUMULATION PERIOD
 
CREDITING ACCUMULATION UNITS IN THE SEPARATE ACCOUNT
 
   
    Accumulation Units are credited to a Series as directed by the Owner upon
receipt of each Purchase Payment or conversion, as the case may be. The number
of Accumulation Units to be credited is determined each business day at the
close of the New York Stock Exchange (currently 4:00 P.M. Eastern Time) by
dividing the net amount allocated to a Series by the value of an Accumulation
Unit in the Series next computed following receipt of the Payment or conversion.
    
 
SEPARATE ACCOUNT ACCUMULATION UNIT CURRENT VALUES
 
    The current value of Accumulation Units of a Series varies with the
investment experience of the Fund in which the assets of the Series are
invested. Such value is determined each business day at the close of the New
York Stock Exchange (currently 4 P.M. Eastern Time) by multiplying the value of
an Accumulation Unit in the Series on the immediately preceding Valuation Date
by the net investment factor for the period since that day. (See "Net Investment
Factor," below.) The Owner bears the investment risk that the aggregate current
value invested in the Series may at any time be less than, equal to, or more
than the amounts originally allocated to the Series.
 
NET INVESTMENT FACTOR
 
    The net investment factor is an index of the percentage change (adjusted for
distributions by the Fund and the deduction of the administration fee, mortality
risk fee and administrative expense risk fee) in the net asset value of the Fund
in which a Series is invested, since the preceding Valuation Date. The net
investment factor may be greater or less than one, depending upon the Fund's
investment performance.
 
SURRENDER FROM THE SEPARATE ACCOUNT
 
   
    An Owner may surrender all or a portion of his or her Contract Value at any
time prior to the Annuity Date. A surrender may result in adverse federal income
tax consequences to the Owner including current taxation of the distribution and
a penalty tax on a premature distribution. (See "Federal Income Tax Status,"
page 18.) Owners should consult their tax advisers before making withdrawals.
    
 
   
    The Contract Value of an Owner's interest in the Separate Account prior to
the Annuity Date may be determined at any time by multiplying the number of
Accumulation Units for each Series credited to the Contract by the current value
of an Accumulation Unit in the Series. Upon receipt of a written request for a
full or partial surrender, Security First Life will determine the value of the
number of Accumulation Units surrendered at the Accumulation Unit value next
computed.
    
 
    A request for a partial surrender from more than one Series must specify the
allocation of the partial surrender among the Series. No partial surrender may
be made that would cause an Owner's interest in any Series to have a value after
the surrender of less than $500, unless the entire amount allocated to such
Series is being surrendered.
 
    Payment of any amount surrendered from the Series will be made within seven
days of the date the written request is received by Security First Life.
Surrender may be suspended when: (i) trading on the New York Stock Exchange is
restricted by the SEC or such Exchange is closed for other than weekends or
holidays; (ii) the SEC has by order permitted such suspension; or (iii) an
emergency as determined by the SEC exists making disposal of portfolio
securities or valuation of assets of the Funds not reasonably practicable.
 
STATEMENT OF ACCOUNT
 
    Prior to the Annuity Date, each Owner will be provided with a written
statement of account each calendar quarter in which a transaction occurred, but
in no event less than one annually. The statement of account will show all
transactions
 
                                       13
<PAGE>   61
 
for the period being reported as well as the number of Accumulation Units of
each Series then credited to the Contract, the current Accumulation Unit value
for each Series, and the Contract Value as of the end of the reporting period.
 
                                ANNUITY BENEFITS
 
VARIABLE ANNUITY PAYMENTS
 
    The Owner's interest in the Series will be applied to provide a Variable
Annuity. The dollar amount of Variable Annuity payments will reflect the
investment experience of the Series but will not be affected by adverse
mortality experience which may exceed the mortality risk charge provided for
under the Contract.
 
ASSUMED INVESTMENT RETURN
 
    Variable Annuity payments will vary from payments based on the Assumed
Investment Return depending on whether the investment experience of the Series
is better or worse than the assumed return. The choice of the Assumed Investment
Return affects the pattern of annuity payments. Over a period of time, if the
Separate Account achieved a net investment result equal to the Assumed
Investment Return applicable to a particular option, the Annuity Unit would not
change in value, and the amount of the Annuity payments would be level. However,
if the Separate Account achieved a net investment result greater than the
Assumed Investment Return, the Annuity Unit would increase in value and the
amount of the Annuity payments would increase in value each year. Similarly, if
the Separate Account achieved a net investment result smaller than the Assumed
Investment Return, the Annuity Unit would decrease in value and the amount of
the Annuity payments would decrease each year.
 
    Although a higher initial payment would be received under a higher Assumed
Investment Return, there is a point in time after which payments under a lower
Assumed Investment Return would be greater, assuming payments continue through
that point in time. The effect of a higher or lower Assumed Investment Return
can be summarized as follows: a higher Assumed Investment Return will result in
a larger initial payment but more slowly rising or more rapidly falling
subsequent payments than a lower Assumed Investment Return.
 
    Unless otherwise elected, the Assumed Investment Return will be 4.25% per
annum. To the extent permitted by state law and regulations, Security First Life
will permit election of an Assumed Investment Return of 3.50%, 5% or 6%. It
should not be inferred, however, that such returns will bear any relationship to
the actual net investment experience of the Series.
 
ELECTION OF ANNUITY DATE AND FORM OF ANNUITY
 
    The Annuity Date and the form of Annuity payment are elected by the Owner.
The normal Annuity Date is the Contract anniversary nearest to the Annuitant's
85th birthday, or the 10th anniversary of the Contract Date, whichever is later,
except in the case of Qualified Contracts, which may require a different date.
To the extent not prohibited by any Qualified Contract requirements, an optional
Annuity Date may be elected; such date may be the first day of any month prior
to the normal Annuity Date. The election must be made at least 31 days before
the optional Annuity Date elected.
 
   
    The normal form of Annuity payment under the Contracts is Option 2, a
variable life Annuity with 120 monthly payments certain. Unless indicated
otherwise, Option 2 will be automatically applied. Changes in the optional form
of Annuity payment may be made at any time up to 31 days prior to the date on
which Annuity payments are to begin. Option 1 through 4 may be elected as either
Variable Annuities or Fixed Annuities, while Option 5 may be elected only as a
Fixed Annuity. The first year's Annuity payments described in Option 1 through 4
are determined on the basis of (i) the mortality table specified in the
Contract, (ii) the age and, where permitted, the sex of the Annuitant, (iii) the
type of Annuity payment option(s) selected, and (iv) the Assumed Interest Return
selected. Fixed Annuity payments described in Option 5 are determined on the
basis of (i) the number of years in the payment period and (ii) the interest
rate guaranteed with respect to the option. Fixed Annuities are funded through
the General Account of Security First Life.
    
 
OPTION 1 -- LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual, ceasing
with the last payment due prior to the death of an individual. This option
offers the maximum level of monthly payments since there is no guarantee of a
minimum number of payments or of death benefits for Beneficiaries.
 
                                       14
<PAGE>   62
 
OPTION 2 -- LIFE ANNUITY WITH 120, 180 OR 240 MONTHLY PAYMENTS CERTAIN
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments not less than 120, 180 or 240
months, as elected. If at the death of the individual the specified number of
payments have not been made, Annuity payments will be continued during the
remainder of such period to the designated Beneficiary.
 
OPTION 3 -- INSTALLMENT REFUND LIFE ANNUITY
 
    An Annuity payable monthly during the lifetime of an individual with a
guaranteed minimum number of monthly payments equal to the amount applied under
this option divided by the first monthly payment. If the payee dies before
receiving the "minimum number" of payments, the remaining payments will continue
to the designated beneficiary.
 
OPTION 4 -- JOINT AND LAST SURVIVOR ANNUITY
 
    An Annuity payable monthly during the joint lifetime of two individuals and
thereafter during the lifetime of the survivor, ceasing with the last payment
due prior to the death of the survivor.
 
OPTION 5 -- PAYMENTS FOR A DESIGNATED PERIOD
 
    A fixed dollar Annuity payable monthly for a specified number of years from
5 to 30. The amount of each payment will be based on an interest rate determined
by Security First Life, that will not be less than 3.50% per annum. Fixed
Annuity payments under this option may not be commuted to a lump sum, except as
provided under "Death Benefits," page 17.
 
FREQUENCY OF PAYMENT
 
    Payments under all options will be made on a monthly basis, unless a
different arrangement has been requested by the Owner and agreed to by Security
First Life. If at any time any payments to be made to any payee under any Series
are or become less than $50 each, Security First Life shall have the right to
decrease the frequency of payments to such intervals as will result in a payment
of at least $50 from each Series.
 
LEVEL PAYMENTS VARYING ANNUALLY
 
    Under the Contract, Variable Annuity payments are determined annually rather
than monthly, so that Annuity payments, uniform in amount, are made monthly
during each Annuity year. The level of payments for each year is based on the
investment performance of the Series up to the Valuation Date as of which the
payments are determined for the year. Thus, amounts of the Annuity payments vary
with the investment performance of the Series from year to year rather than from
month to month.
 
    The monthly Variable Annuity payments for the first year will be determined
on the last Valuation Date of the second calendar week preceding the Annuity
Date by using a formula described in the Contract. On each anniversary of the
Annuity Date, Security First Life will determine the total monthly payments for
the year then beginning. These will be determined by multiplying the number of
Annuity Units in each Series from which payments are to be made by the Annuity
Unit value of that Series for the Valuation Period in which the first payment
for that year is due.
 
    The amount of the year's Variable Annuity payments is transferred to the
General Account at the beginning of the year. Although an amount in the Separate
Account is credited to an Annuitant and transferred to the General Account to
make Annuity payments, it should not be inferred that the Annuitant has any
property rights in this amount. The Annuitant has only a contractual right to
Annuity payments from the amount credited to him or her in the Separate Account.
 
    The monthly Annuity payments for the year are made from the General Account
with interest credited, in effect, using the Assumed Investment Return of 4.25%
or the alternative Assumed Investment Return selected by the Owner. Security
First Life will experience profits or loss on the amounts placed in the General
Account to provide level monthly payments during the year to the extent that net
investment income and gains in the General Account exceed or are lower than the
Assumed Investment Return selected.
 
    Because Annuity payments for the year are set at the beginning of the year,
the Annuitant will not benefit from increases in Annuity Unit values during the
year and likewise will not be at risk for decreases during the year. However,
such increases and decreases will be reflected in the calculation of Annuity
payments for the subsequent year.
 
                                       15
<PAGE>   63
 
ANNUITY UNIT VALUES
 
    The value of an Annuity Unit at a Valuation Date is determined by
multiplying the value of the Annuity Unit at the preceding Valuation Date by an
"Annuity Change Factor." The Annuity Change Factor is an adjusted measurement of
the investment performance of the Fund since the end of the preceding Valuation
Period. The Annuity Change Factor is determined by dividing the value of the
Accumulation Unit at the Valuation Date by the value of the Accumulation Unit at
the preceding Valuation Date and multiplying the result by a neutralization
factor.
 
    The neutralization factor is determined by dividing 1 by the weekly
equivalent of the Assumed Investment Return previously selected by the
Annuitant. For example, the neutralization factor for the Assumed Investment
Return of 4.25% is 0.9991999.
 
    The number of Annuity Units for a Series is determined by dividing the
monthly Annuity payment for the first year by that Series' Annuity Unit value on
the same date the first year's Annuity payments are calculated. The number of
Annuity Units will not change unless the Owner converts Annuity Units to or from
other Series or amounts from the General Account.
 
                                 DEATH BENEFITS
 
DEATH BEFORE THE ANNUITY DATE
 
    In the event that the Annuitant who is not the Owner dies before the Annuity
Date, the Owner shall become the Annuitant. If the Owner dies before the Annuity
Date, whether or not he or she is the Annuitant, the Beneficiary will be
entitled to receive a death benefit. For purposes of determining the death of
the Owner, the death of any joint Owner shall be deemed to be the death of the
Owner. With respect to Nonqualified Contracts, if the Owner is not a natural
person and the Annuitant dies, the cash value will be paid in a lump sum to the
Owner or the Contract will be transferred to a natural person, in accordance
with the Owner's written request, and the transferee will become the Owner and
Annuitant.
 
    The death benefit shall be the greater of: (i) the Purchase Payments
received under the Contract, reduced by amounts already applied to produce
Annuity Income payments or for any prior partial surrenders or (ii) the Contract
Value at the time of settlement.
 
   
    The Beneficiary may elect to receive the death benefit as either: (i)
Annuity Income under Annuity Income Options One, Two, or Five described in
Article 7 of the Contract, provided that an election of an Annuity Income Option
is subject to the following conditions: (a) payments must begin within one year
of the Owner's death (provided that under a Qualified Contract the spouse of the
Owner may delay commencement of payments to the date on which the Owner would
have attained age 70 1/2); (b) the guaranteed period under Option Two or the
designated period under Option Five may not be longer than the Beneficiary's
life expectancy under applicable tables specified by the Internal Revenue
Service; and (c) the Contract Value as of the date of the first Annuity Income
payment will be used to determine the amount of the death benefit to be applied;
or (ii) a lump sum payout, provided that this payout shall be made within five
(5) years of the date of death of the Owner.
    
 
    If the sole Beneficiary is the spouse of the Owner, the spouse may elect to
succeed to all rights of the Owner under this Contract. If there is more than
one Beneficiary living at the time of the Owner's death, each will share in the
proceeds of the death benefit equally, unless the Owner has elected otherwise.
If the Owner outlives all Beneficiaries, the death benefit will be paid to the
Owner's estate in a lump sum. No Beneficiary shall have the right to assign,
anticipate or commute any future payments under any of the options, except as
provided in the election or by law.
 
    Rights to the death benefit will pass as if the Owner outlived the
Beneficiary if: (i) the Beneficiary dies at the same time as the Owner; or (ii)
the Beneficiary dies within 15 days of the Owner's death and prior to the date
due proof of the Owner's death is received by Security First Life. Due proof of
death will be a certified death certificate, an attending physician's statement,
a decree of a court of competent jurisdiction as to the finding of death, or
such other documents as Security First Life may, at its option, accept.
 
DEATH AFTER THE ANNUITY DATE
 
    If the Annuitant under a Contract dies on or after the Annuity Date, the
remaining portion of his or her interest will be distributed at least as rapidly
as under the method of distribution being used at the date of the Annuitant's
death. If no designated Beneficiary survives the Annuitant, the present value of
any remaining payments certain on the date of death of the Annuitant, calculated
on the basis of the assumed investment return previously elected, may be paid in
one
 
                                       16
<PAGE>   64
 
sum to the estate of the Annuitant unless other provisions have been made and
approved by Security First Life. This value is calculated as of the date of
payment following receipt of due proof of death.
 
    Unless otherwise restricted, a Beneficiary receiving variable payments under
Option 2 or 3 after the death of an Annuitant may elect at any time to receive
the present value of the remaining number of Annuity payments certain in a
single payment, calculated on the basis of the assumed investment return
previously selected. However, such election is not available to a Beneficiary
receiving Fixed Annuity payments.
 
                           FEDERAL INCOME TAX STATUS
 
    The operations of the Separate Account form part of the operations of
Security First Life, but the Code provides that no federal income tax will be
payable by Security First Life on the investment income and capital gains of the
Separate Account. No federal income tax is payable by the Owner on the
investment income and capital gains under a Contract until Annuity payments
commence or a full or partial withdrawal is made.
 
QUALIFIED CONTRACTS
 
    Under a section 401 pension plan, withdrawals may be made only in the event
of death, disability, separation from service, or attainment of normal
retirement age. Under Section 403(b) of the Code withdrawal prior to age 59 1/2
of amounts attributable to contributions and earnings made after December 31,
1988, are restricted in a manner similar to those under Section 401 pension
plans. However, under a 403(b) annuity, the Code permits withdrawals of the
contributed amounts (and not the earnings thereon) in cases of financial
hardship. The restrictions on withdrawals from Section 403(b) annuities do not
apply to Contract values attributable to Contract values before January 1, 1989.
In the case of Section 457 deferred compensation plan, benefits are not
permitted to be made available earlier than when the employee attains age
70 1/2, separates from service or is faced with an unforeseeable emergency.
Withdrawals from an IRA can be made when the Owner attains age 59 1/2, dies or
becomes disabled.
 
    Generally, all withdrawals made prior to age 59 1/2 that are not a result of
death, disability, domestic relations order, deductible medical expense or
received as a series of substantially equal payments made for the life of the
Owner or the joint lives of the Owner and Owner's beneficiary will be subject to
an additional 10% tax. Distributions from a Section 457 plan are not subject to
this 10% penalty tax.
 
   
    In the case of section 401 or section 457 plans, the Contract Value must be
distributed, or Annuity payments for life or a period not exceeding the life
expectancy of the Participant or the Participant and a designated Beneficiary
must commence by April 1 of the calendar year following the calendar year in
which the employee attains age 70 1/2 (in the case of government plans and
Section 457 Plans) or retires. The exception for retirement terminates on
December 31, 1988 except for governmental plans and employees who have attained
age 70 1/2 before January 1, 1988. If the Participant is the Owner of an IRA,
then the required distributions described above must be made or commenced no
later than the following April 1. The same distribution requirements apply to
Section 403(b) tax sheltered annuities with respect to benefits accruing after
December 31, 1986 in taxable years ending after that date.
    
 
    Providing certain requirements of the Code are met, distributions, other
than required distributions, from a plan may be rolled over tax-free to another
plan. Distributions from a section 401 plan may be rolled over to another
section 401 plan or to an IRA. Distributions from a tax-sheltered Annuity may be
rolled over to another tax-sheltered Annuity or to an IRA. Distributions from an
IRA may be rolled over to another IRA and, if the IRA contains only permissible
rollover amounts, to a section 401 plan or a tax-sheltered Annuity.
 
    All distributions, with the exception of a return of nondeductible employee
contributions, received from a section 401, 403(b), 457 plan or IRA are included
in gross income. In the case of section 401, or 403(b) plans and IRAs, a
distribution is includible in the year in which it is paid. In the case of a
section 457 plan, a distribution is includible in the year it is paid or when
made available depending upon whether certain Code requirements are met. In very
limited situations, a lump sum distribution from a section 401 plan may qualify
for special forward income averaging may qualify for special long term capital
gain treatment.
 
    In addition to the minimum distribution requirements, any payouts under
Section 401, 403(b) and 457 plans and IRAs must meet minimum incidental death
benefit requirements under the Code. This requirement does not apply in the case
of 401 plan Participants when the Participant's spouse is the designated
beneficiary.
 
    Employers may deduct their contributions to self-employed and corporate
pension and profit-sharing plans described in section 401 of the Code and tax-
sheltered Annuities described in section 403(b) in the year when made,
 
                                       17
<PAGE>   65
 
up to the limits specified in the Code. In addition these plans may permit
nondeductible employee contributions. Any nondeductible employee contribution
will be received tax free as a portion of each annuity payment.
 
NON-QUALIFIED CONTRACTS
 
   
    Distributions before the Annuity Date are treated as coming first from
earnings, rather than purchase payments, until the entire amount of earnings has
been distributed. For federal tax purposes, distributions include the receipt of
proceeds from loans and the assignment or pledge of any portion of the Contract
Value, as well as withdrawals, income payments, or death benefits. All deferred
annuity contracts issued by an issuer to a policyholder in one calendar year
will be treated as one contract for purposes of determining the tax consequences
of any distribution. Distributions before the Annuity Date are taxable as
ordinary income to the extent that the Contract Value exceeds Purchase Payments.
    
 
    Different rules apply to amounts distributed as an Annuity. A portion of
each Annuity payment is treated as a nontaxable return of Purchase Payments. The
remaining portion of each Annuity payment is taxable as ordinary income. The
amount of each Annuity payment which is taxable is based on the period over
which payments are to be made or, in the case of a life Annuity, the life
expectancy of the Annuitant. A lump sum taken in lieu of remaining Annuity
payments will be treated for tax purposes as a withdrawal.
 
    Income distributed as an Annuity or as a lump sum withdrawal will be subject
of a 10% excise tax unless the distribution (1) occurs after the taxpayer
attained age 59 1/2, (2) occurs after death or disability of the holder, (3) is
attributable to an investment prior to August 14, 1982, (4) is in the form of an
immediate annuity or (5) is a part of substantially equal payments to be made
over the life or life expectancy of the taxpayer or the taxpayer and his or her
designated beneficiary. The penalty will be imposed if an individual who elected
to receive payments in substantially equal installments as a life or life
expectancy annuity prior to age 59 1/2 changes the method of distribution before
age 59 1/2. This individual will be assessed the penalty even after age 59 1/2
if annuity payments have not continued for five (5) years.
 
    Code Section 72(e)(11) provides that multiple annuity contracts which are
issued within a calendar year to the same Contract Owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences.
 
WITHHOLDING
 
   
    Security First Life is required to withhold federal income tax on Annuity
payments, lump sum distributions and partial withdrawals. However, recipients of
Contract distributions are allowed to make an election not to have federal
income tax withheld except as otherwise described below. After an election is
made with respect to Annuity payments, an Annuitant may revoke the election at
any time, and thereafter commence withholding. Security First Life will notify
the payee at least annually of his or her right to revoke the election.
    
 
    Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10 years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in a direct trustee-to-trustee transfer, no withholding
will be required.
 
    Payees are required by law to provide Security First Life (as payor) with
their correct taxpayer identification number ("TIN"). If the payee is an
individual, the TIN is the same as his or her social security number.
 
   
OBTAINING TAX ADVICE
    
 
   
    It should be recognized that the federal income tax information in this
prospectus is not exhaustive and is for information purposes only. The
discussion above does not purport to cover all situations involving the purchase
of an Annuity or the election of an option under the Contract. Tax results may
vary depending upon individual situations and special rules may apply in certain
cases. State and local tax results may also vary. For these reasons a qualified
tax adviser should be consulted.
    
 
                                       18
<PAGE>   66
 
                                 VOTING RIGHTS
 
    Each Owner will have the right to instruct Security First Life with respect
to voting the Fund shares which are the assets underlying his interest in the
Separate Account, at all regular and special shareholders meetings. Security
First Life will mail to each Owner, at his last known address, all periodic
reports and proxy material of the applicable Fund and a form with which to give
voting instructions. Fund shares as to which no timely instructions are received
will be voted by Security First Life in proportion according to the instructions
received from all Owners giving timely instructions. Security First Life is
under no duty to inquire as to the instructions received or the authority of
persons to instruct the voting of Fund shares, and unless Security First Life
has actual knowledge to the contrary, the instructions given to it will be valid
as they affect Security First Life or the Funds.
 
    Once Annuity payments with respect to an Owner's Account have begun, the
Annuitant shall have any voting rights exercisable with respect to the Fund
shares.
 
    The number of votes to be cast by each person having the right to vote shall
be determined as of a record date within 90 days prior to the meeting of the
Fund, and voting instructions will be solicited by written communication at
least 10 days prior to such meeting. To be entitled to vote, an Owner or
Annuitant must have been such on the record date. The number of shares as to
which voting instructions may be given to Security First Life is determined by
dividing that portion of the Contract Value then allocated to the Series for
that Fund on the record date by the net asset value of a Fund share as of the
same date.
 
                               LEGAL PROCEEDINGS
 
    Security First Life, in the ordinary course of its business, is engaged in
litigation of various kinds which in its judgment is not of material importance
in relation to its total assets. There are no present or pending material legal
proceedings affecting the Separate Account.
 
                             ADDITIONAL INFORMATION
 
   
    For further information contact Security First Life at the address and phone
number on the cover of this Prospectus. A copy of the Statement of Additional
Information, dated May 1, 1996, which provides more detailed information about
the Contracts, may also be obtained. Set forth below is the table of contents
for the Statement of Additional Information.
    
 
    A registration statement has been filed with the SEC under the Securities
Act of 1933 with respect to the Contracts offered hereby. This Prospectus does
not contain all the information set forth in the registration statement, to all
of which reference is made for further information concerning the Separate
Account, Security First Life and the Contracts offered hereby. Statements
contained in this Prospectus as to the contents of the Contracts and other legal
instruments are summaries. For a complete statement of the terms thereof
reference is made to such instruments as filed.
 
            TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION
 
<TABLE>
<CAPTION>
                                                                                                 PAGE
                                                                                                 -----
<S>                                                                                              <C>
The Insurance Company............................................................................    3
The Separate Account.............................................................................    3
The Funds........................................................................................    3
Purchase of Securities Being Offered.............................................................    7
Net Investment Factor............................................................................    7
Annuity Payments.................................................................................    7
Withholding on Annuity Payments and Other Distributions..........................................    9
Underwriters, Distribution of the Contracts......................................................   10
Calculation of Performance Data..................................................................   10
Voting Rights....................................................................................   12
Safekeeping of the Securities....................................................................   12
Servicing Agent..................................................................................   12
Independent Auditors.............................................................................   12
Legal Matters....................................................................................   12
State Regulation of Security First Life..........................................................   12
Financial Statements.............................................................................   13
</TABLE>
 
                                       19
<PAGE>   67
                                                        '33 Act File No. 33-7094

                                  STATEMENT OF

                             ADDITIONAL INFORMATION

                     SECURITY FIRST LIFE SEPARATE ACCOUNT A

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

             INDIVIDUAL FLEXIBLE PAYMENT VARIABLE ANNUITY CONTRACTS

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



   
                      SECURITY FIRST LIFE INSURANCE COMPANY

                                   MAY 1, 1996

This Statement of Additional Information is not a prospectus and should be read
in conjunction with the prospectus. A copy of the prospectus, dated May 1, 1996,
may be obtained without charge by writing to Security First Life Insurance
Company, P.O. Box 92193, Los Angeles, California 90009 or by telephoning 1 (800)
284-4536.


    

SF 135 - R2C


<PAGE>   68
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                        Page
<S>                                                                     <C>
The Insurance Company                                                   3

The Separate Account                                                    3

The Funds                                                               3

Purchase of Securities Being Offered                                    6

Net Investment Factor                                                   7

Annuity Payments                                                        7

Withholding on Annuity Payments and Other Distributions                 9

Underwriters, Distribution of the Contracts                             9

Calculation of Performance Data                                         10

Voting Rights                                                           11

Safekeeping of Securities                                               11

Servicing Agent                                                         12

Independent Auditors                                                    12

Legal Matters                                                           12

State Regulation of Security First Life                                 12

Financial Statements                                                    12
</TABLE>

                                       2
<PAGE>   69
THE INSURANCE COMPANY

   
Security First Life Insurance Company ("Security First Life") is a wholly owned
subsidiary of Security First Group, Inc. ("SFG"). The common shares of SFG are
held by London Insurance Group, a Canadian insurance services corporation and a
publicly-traded subsidiary of the Trilon Financial Corporation of Toronto,
Canada.
    

THE SEPARATE ACCOUNT

The Security First Life Separate Account A ("Separate Account") presently funds
the Contracts described in this Prospectus and group variable annuity contracts
on Forms SF 224FL, SF 226R1, SF 234 and SF 236. These group variable annuity
contracts are described in other prospectuses. The individual combination fixed
and variable annuity contracts ("Contracts") described in this Statement of
Additional Information and related prospectuses are distinct contracts from the
above described group variable annuity contacts.

   
Amounts allocated to the Separate Account under the Contracts are invested in
the securities of eleven Funds: (i) the Money Market Portfolio, Equity-Income
Portfolio, Growth Portfolio and Overseas Portfolio of the Variable Insurance
Products Fund; (ii) the Asset Manager Portfolio, Contrafund Portfolio and Index
500 Portfolio of the Variable Insurance Products Fund II; (iii) the Virtus U.S.
Government Income Series, T. Rowe Price Bond Series and the T. Rowe Price Growth
and Income Series of the Security First Trust; and (iv) the Small Capitalization
Portfolio of The Alger American Fund. The Separate Account is divided into a
number of Series of Accumulation and Annuity Units, eleven of which are offered
under the Contracts: Series FM (Money Market Portfolio), Series FE
(Equity-Income Portfolio), Series FG (Growth Portfolio), Series FO (Overseas
Portfolio), Series FA (Asset Manager Portfolio), Series FC (Contrafund
Portfolio), Series FI (Index 500 Portfolio), Series SU (Virtus U.S. Government
Income Series), Series B (T. Rowe Price Bond Series), Series G (T. Rowe Price
Growth and Income Series) and Series SC (Small Capitalization Portfolio).
    

THE FUNDS

The Variable Insurance Products Fund and Variable Insurance Products Fund II are
Massachusetts business trusts and are registered with the Securities and
Exchange Commission as open-end, diversified management investment companies.

Money Market Portfolio seeks to obtain as high a level of current income as is
consistent with preserving capital and providing liquidity. The Portfolio will
invest only in high quality U.S. dollar denominated money market securities of
domestic and foreign issuers.

Equity-Income Portfolio seeks reasonable income by investing primarily in
income-producing equity securities. In choosing these securities, the fund 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 500 Composite Stock Price Index.

Growth Portfolio seeks to achieve capital appreciation. The Portfolio normally
purchases common stocks, although its investments are not restricted to any one
type of security. Capital appreciation may also be found in other types of
securities, including bonds and preferred stocks.

Overseas Portfolio seeks long term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.

                                       3
<PAGE>   70
Asset Manager Portfolio seeks high total return with reduced risk over the
long-term by allocating its assets among stocks, bonds and short-term
fixed-income instruments.

Contrafund Portfolio seeks capital appreciation by investing in companies which
the investment adviser believes to be undervalued due to an overly pessimistic
appraisal by the public.

Index 500 Portfolio seeks to provide investment results which correspond to the
total return (i.e., the combination of capital changes and income) of common
stocks publicly traded in the United States. In seeking this objective, the
Portfolio attempts to duplicate the composition and total return of the Standard
& Poor's 500 Composite Stock Price Index while keeping transaction costs and
other expenses low. The Portfolio is designed as a long-term investment option.

   
Security First Trust is a Massachusetts business trust which was formed on
February 13, 1987. Two of the series of the Trust are offered under the
Contracts:

Virtus U.S. Government Income Series (formerly U.S. Government Income Series)
seeks to provide current income. The Series pursues this objective by investing
in a professionally managed, diversified portfolio limited primarily to U.S.
government securities.

T. Rowe Price Bond Series (formerly Bond Series) seeks to achieve the highest
investment income over the long-term consistent with the preservation of
principal through investment primarily in marketable debt instruments. Growth of
principal and income will also be objectives with respect to up to 10% of the
Series' assets which may be invested in common and preferred stocks.

T. Rowe Price Growth and Income Series (formerly Growth and Income Series) seeks
growth of principal and a reasonable level of current income. While this Series
will generally invest in common stocks and other equities, it may, depending on
economic conditions, reduce such investments and substitute fixed income
instruments. Through flexible and aggressive portfolio management, this Series
will attempt to take advantage of opportunities for both growth of principal and
current income.
    

The Alger American Fund is a Massachusetts business trust which has a number of
portfolios, one of which is available under the Contracts:

   
Small Capitalization Portfolio seeks long-term capital appreciation by investing
in a diversified, actively managed portfolio of equity securities, primarily of
companies with total market capitalization within the range of companies
included in the Russell 2000 Growth Index. Income is a consideration in the
selection of investments but is not an investment objective of the Portfolio.
    

Variable Insurance Products Fund and Variable Insurance Products Fund II have
entered into investment advisory agreements with Fidelity Management and
Research Company ("FMR") under which it received investment advisory fees.

Money Market Portfolio's advisory fee is made up of two components: (a) a basic
fee rate and (b) an income-based component. The basic fee rate is the sum of the
following two components:

   
       a. A group fee rate based on the monthly average net assets of all the
       mutual funds advised by FMR. This rate cannot rise above .37%, and it
       drops as total assets in all these funds rise. The effective group fee
       rate for December 1995 was .1482%.
    

                                       4
<PAGE>   71
       b.  An individual fund fee rate of 0.03%.

One-twelfth of the combined annual fee rate is applied to the fund's net assets
averaged over the most recent month, giving a dollar amount which is the fee for
that month. If the fund's gross yield is 5% or less, the basic fee is the total
management fee. The income-based component is added to the basic fee only when
the fund's yield is greater than 5%. The income-based fee is 6% of that portion
of the fund's yield that represents a gross yield of more than 5% per year. The
maximum income-based component is .24%.

   
For fiscal year 1995, the Portfolio's Management fee was 0.24% of the average
net assets of the Portfolio, approximately $2.40 for every $1,000 of the
Portfolio's average net assets.
    

Growth, Overseas, Equity-Income, Asset Manager and Contrafund Portfolios' annual
fee rates are the sum of two components:

   
       a. A group fee rate based on the monthly average net assets of all the
       mutual funds advised by FMR. This rate cannot rise above .52%, and it
       drops as total assets in all these funds rise. The effective group fee
       rate for December 1995 was .3097%.
    

       b. An individual fund fee rate of .30% for the Growth Portfolio, .45% for
       the Overseas Portfolio, .20% for the Equity-Income Portfolio, .40% for
       the Asset Manager Portfolio and .30% for the Contrafund Portfolio.

One-twelfth of the combined annual rate is applied to each Portfolio's net
assets averaged over the most recent month, giving a dollar amount which is the
fee for that month.

   
In fiscal year 1995, FMR's fee was .61% of Growth Portfolio's average net assets
($6.10 per $1,000), .76% of Overseas Portfolio's average net assets ($7.60 per
$1,000), .51% of Equity-Income Portfolio's average net assets ($5.10 per
$1,000), .71% of Asset Manager Portfolio's average net assets ($7.10 per $1,000)
and .61% of Contrafund Portfolio's average net assets ($6.10 per $1,000).
Overseas Portfolio's total fee may be higher than those of other mutual funds
because of the greater complexity, expense and commitment of resources involved
in international investing.

Index 500 Portfolio pays a monthly management fee to FMR at the annual rate of
 .28% of the Portfolio's average net assets. One-twelfth of this annual fee rate
is applied to the net assets averaged over the most recent month, giving a
dollar amount which is the management fee for that month. In fiscal year 1995,
FMR reimbursed to the Portfolio its management fee.

The mutual funds advised by FMR have over 25 million shareholder accounts with a
total value of more than $374 billion.

Security First Trust has contracted to receive investment advice and management
services from Security First Investment Management Corporation ("Security
Management") a wholly-owned subsidiary of SFG, and an affiliate of Security
First Life and Security First Financial, Inc. Security Management receives an
annual fee, accrued daily and payable in monthly installments, based on 0.50% of
the average daily net assets of the T. Rowe Price Bond Series and T. Rowe Price
Growth and Income Series and .90% for the Virtus U.S. Government Income Series.

Security Management has entered into Sub-Advisory Agreements with T. Rowe Price
Associates, Inc. ("Price Associates") under which Price Associates provides
investment advisory services to the T. Rowe Price Bond Series and T. Rowe Price
Growth and Income Series of Security First Trust. Price Associates receives an
annual fee from Security 

                                       5
<PAGE>   72
Management, accrued daily and payable in monthly installments, equal to 0.35% of
average daily net assets of each of the Series.

Security Management has also entered into a sub-advisory agreement with Virtus
Capital Management, Inc. ("Virtus") under which Virtus provides investment
advisory services to the Virtus U.S. Government Income Series of Security First
Trust. Virtus is entitled to receive an annual fee from Security Management,
accrued daily and payable in monthly installments equal to 0.75% of average
daily net assets of the Series. In 1995 the fees charged by Security Management
and Virtus were voluntarily reduced to .08% and .14%, respectively.
    

The Alger American Fund has contracted to receive investment advice and
management services from Fred Alger Management, Inc. ("Alger Management"), a
wholly owned subsidiary of Alger Associates, Inc. Alger Management receives an
annual fee, accrued daily and paid monthly, equal to .85% of the Small
Capitalization Portfolio's average daily net assets.

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in a portfolio of common stocks is to provide Annuitants with
Annuity Payments which will tend to remain level during a period when the
economy is relatively stable and to provide increased Annuity Payments during
periods of economic growth and inflation. It is believed that the value of such
Separate Account investment will, over the long-term, tend to reflect changes in
the general economic price level. Historically, the value of diversified
portfolio of common stocks held for an extended period of time has tended to
rise during periods of economic growth and inflation. However, there is no exact
correlation between the two. In some periods, the value of a common stock
portfolio has declined while the cost of living has increased.

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in fixed income securities is to provide Annuitant with Annuity
Payments which will be higher in amount than those provided by conventional
Fixed Annuities. It should be recognized, however, that a portfolio consisting
of nonconvertible fixed income securities and which is designed to obtain a high
level of current yield involves market risks that are not found in a Fixed
Annuity and differ from those found in a Variable Annuity that is invested
primarily in common stocks.

   
The market value of nonconvertible fixed income securities usually reflects
yields then generally available in securities of similar quality and type. Based
upon historical analysis, when interest rates decline, the market value of a
portfolio already invested at higher interest rates may be expected to rise if
such securities are not subject to call at the option of the issuer. Conversely,
when such interest rates increase, the market value of a portfolio already
invested at lower interest rates may be expected to decline. The Asset Manager
Portfolio, T. Rowe Price Bond Series, T. Rowe Price Growth and Income Series and
Virtus U.S. Government Income Series may, pursuant to their investment policies,
invest a significant portion of their assets in long-term fixed income
securities. Because of this, Owners who select one of these Series as the basis
for Annuity payments should recognize that Annuity Payments may decrease during
periods when interest rates and general prices are rising.
    

Owners should carefully consider which of the underlying Funds is best suited to
their long-term needs.

PURCHASE OF SECURITIES BEING OFFERED

Purchase Payments may be made at any time. The minimum initial Purchase Payment
is $1,000 with each additional Purchase Payment subject to a $100 minimum.
Purchase 

                                       6
<PAGE>   73
Payments to the combination fixed and variable annuity contract may be allocated
to the General Account or the Separate Account, or allocated between these
Accounts. Amounts in Separate Account Series may be converted to amounts in any
one or more other Separate Account Series at any time. Amounts invested in the
fixed and variable annuity contract may also be transferred from the Separate
Account to the General Account; however, amounts may not be transferred from the
General Account to the Separate Account except upon annuitization.

NET INVESTMENT FACTOR

The Separate Account net investment factor is an index of the percentage change
(adjusted for distributions by the Fund and the deduction of the actuarial risk
fee) in the net asset value of each Fund in which the Series in invested, since
the preceding Business Day. The Separate Account net investment factor for each
Series of Accumulation Units is determined for any Business Day by dividing (i)
the net asset value of a share of the Fund which is represented by such Series
at the close of business on such day, plus the per share amount of any
distributions made by such Fund on such day by (ii) the net asset value of a
share of such Fund determined as of the close of business on the preceding
Business Day and then subtracting from the result the daily factors for
administration fees, mortality risks and administrative expense risks (.003836%)
for each calendar day between the preceding Business Day and the end of the
current Business Day.

ANNUITY PAYMENTS

Basis of Variable Benefits

The Variable Annuity benefits rates used in determining Annuity Payments under
the Contracts are based on actuarial assumptions, reflected in tables in the
Contracts, as to the expected mortality and adjusted age and the form of Annuity
selected. The mortality basis for these tables is Security First Life's Modified
Select Annuity Mortality Table, projected to the year 2000 on Projection Scale
C, with interest at 4.25% for all functions involving life contingencies and the
portion of any period certain beyond 10 years, and 3.25% for the first 10 years
of any certain period. Adjusted age in those tables means actual age to the
nearest birthday at the time the first payment is due, adjusted according to the
following table:

<TABLE>
<CAPTION>
              CALENDAR YEAR OF BIRTH                ADJUSTED AGE IS
              ----------------------                ---------------
<S>                                               <C>
                    Before 1916                       Actual Age
                    1916 - 1935                   Actual Age Minus 1
                    1936 - 1955                   Actual Age Minus 2
                    1956 - 1975                   Actual Age Minus 3
                    1976 - 1995                   Actual Age Minus 4
</TABLE>


Determination of Amount of Monthly Variable Annuity Payments For First Year

The Separate Account value used to establish the monthly Variable Annuity
Payment for the first year consists of the value of Accumulation Units of each
Series of the Separate Account credited to a Contract Owner on the last day of
the second calendar week before the Annuity Date. The Contracts contain tables
showing monthly payment factors and Annuity premium rates per $1,000 of Separate
Account value to be applied under Options 1 through 4.

At the beginning of the first payment year an amount is transferred from the
Separate Account to the General Account and level monthly Annuity Payments for
the year are made out of the General Account for that year. That amount to be
transferred is determined by multiplying the 

                                       7
<PAGE>   74
Annuity premium rate per $1,000 set forth in Contract tables by the number of
thousands of dollars of Separate Account value credited to a Contract Owner. The
level monthly payment for the first payment year is then determined by
multiplying the amount transferred (the Annuity premium) by the monthly payment
factor in the same table. In the event the Contract involved has Separate
Account Accumulation Units in more than one Series, the total monthly Annuity
Payment for the first year is the sum of the monthly Annuity Payments,
determined in the same manner as above, for each Series.

At the time the first year's monthly payments are determined, a number of
Annuity Units for each Separate Account Series is also established for the
Annuitant by dividing the monthly payment derived from that Series for the first
year by the Separate Account Annuity Unit values for the Series on the last
Business Day of the second calendar week before the first Annuity Payment is
due. The number of Annuity Units remains fixed during the Annuity period unless
Annuity Units are converted to another Series.

Determination of Amount of Monthly Variable Annuity Payments for Second and
Subsequent Years

As of each anniversary of the Annuity Date, Security First Life will determine
the amount of the monthly Variable Annuity Payments for the year then beginning.
Separate determinations will be made for each Separate Account Payments for the
year then beginning. Separate determinations will be made for each Separate
Account Series in which the Annuitant has Annuity Units, with the total Annuity
Payment being the sum of the payments derived from the Series. The amount of
monthly payments for any Separate Account Series for any year after the first
will be determined by multiplying the number of Annuity Units for that Series by
the Annuity Unit value for that Series for the Valuation Period in which the
first payment for the year is due. It will be Security First Life's practice to
mail Variable Annuity Payments no later than seven days after the last day of
the Valuation Period upon which they are based or the monthly anniversary
thereof.

The objective of a Variable Annuity contract is to provide level payments during
periods when the economy is relatively stable and to reflect as increased
payments only the excess of investment results flowing from inflation or an
increase in productivity. The achievement of this objective will depend in part
upon the validity of the assumption that the net investment return of the
Separate Account equals the Assumed Investment Return during periods of stable
prices. Subsequent years' payments will be smaller than, equal to or greater
than the first year's payments depending on whether the actual net investment
return for the Separate Account is smaller than equal to or greater than the
Assumed Investment Return.

Annuity Unit Value

The initial value of an Annuity Unit is $5 for each Series for the first
Valuation Period as of which the first Variable Annuity Payment from such Series
is made. The value of an Annuity Unit for each Series on any later date is
determined by multiplying the value of an Annuity Unit at the end of the
preceding Valuation Period by the "Annuity change factor" for the second
preceding Valuation Period. The Annuity change factor is an adjusted measurement
of the investment performance of the Fund since the end of the preceding
Valuation Period. The Annuity change factor is determined by dividing the value
of an Accumulation Unit at the end of the Valuation Period by the value of an
Accumulation Unit at the end of the preceding Valuation Period and multiplying
the result by a neutralization factor.

Variable Annuity Payments for each year after the first reflect variations in
the investment performance of the Separate Account above and below an Assumed
Investment Return. This assumed investment rate is included for purposes of
actuarial computations and does not relate 

                                       8
<PAGE>   75
to the actual investment performance of the underlying Fund. Therefore, the
Assumed Investment Return must be "neutralized" in computing the Annuity change
factor. For weekly Valuation Periods and a 4.25% Assumed Investment Return, the
neutralization factor is 0.9991999.

WITHHOLDING ON ANNUITY PAYMENTS AND OTHER DISTRIBUTIONS

Security First Life is required to withhold federal income tax on Contract
distributions (such as Annuity Payments, lump sum distributions or partial
surrenders). However, recipients of Contract distributions are allowed to make
an election not to have federal income tax withheld. After such election is made
with respect to Annuity Payments, an Annuitant may revoke the election at any
time, and thereafter commence withholding. In such a case, Security First Life
will notify the payee at least annually of his or her right to change such
election.

The withholding rate followed by Security First Life will be applied only
against the taxable portion of Contract distributions. Federal tax will be
withheld from Annuity Payments pursuant to the recipient's withholding
certificate. If no withholding certificate is filed with Security First Life,
federal tax will be withheld from Annuity Payments on the basis that the payee
is married with three withholding exemptions. Federal tax on the taxable portion
of a partial or total surrender (i.e., non-periodic distribution) generally will
be withheld at a flat 10% rate. In the case of a plan qualified under Sections
401(a) or 403(a) of the Code, if the balance to the credit of a participant in a
plan is distributed within one taxable year to the recipient ("total
distribution"), the amount of withholding will approximate the federal income
tax on a lump sum distribution. If a total distribution is made from such a plan
or a tax-sheltered annuity on account of the participant's death, the amount of
withholding will reflect the exclusion from federal income tax for
employer-provided death benefits.

Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10 years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in the case of a 401 plan or to another eligible contract
in the case of a 403(b) plan in a direct trustee-to-trustee transfer, no
withholding will be required.

Payees are required by law to provide Security First Life (as payor) with their
correct taxpayer identification number ("TIN"). If the payee is an individual,
the TIN is the same as his or her social security number. If the payee elects
not to have federal income tax withheld on an Annuity Payment or a nonperiodic
distribution and a correct TIN has not been provided, such election is
ineffective, and such payment will be subject to withholding as noted above.

UNDERWRITERS, DISTRIBUTION OF THE CONTRACTS

   
The Contracts will be sold as a continuous offering by individuals who are
appropriately licensed as insurance agents of Security First Life for the sale
of life insurance and Variable Annuity Contracts in the state where the sale is
made. In addition, these individuals will be registered representatives of the
principal underwriter, Security First Financial, Inc., or of other
broker-dealers registered under the Securities Exchange Act of 1934 whose
registered representatives are authorized by applicable law to sell Variable
Annuity Contracts issued by 


                                       9
<PAGE>   76
Security First Life. Commissions on sales of contracts range from 0% to 8.5%.
Agents are paid from the General Account of Security First Life. Such
commissions bear no direct relationship to any of the charges under the
Contracts. It is expected that the Contracts will be sold in 49 states and the
District of Columbia. No direct underwriting commissions are paid to Security
First Financial, Inc.
    

CALCULATION OF PERFORMANCE DATA

   
a. Money Market Portfolio. The yield of the Money Market Portfolio of the
Separate Account for the seven day period ended December 31, 1995 was 3.95%.
This yield was computed by determining the net change, exclusive of capital
changes, in the value of a hypothetical pre-existing account having a balance of
one accumulation unit of the Series at the beginning of the period, subtracting
a hypothetical charge reflecting deductions from account values, and dividing
the difference by the value of the account at the beginning of the base period
to obtain the base period return, and multiplying the base period return by
(365/7) with the resulting yield figure carried to a least the nearest hundredth
of one percent.

The effective yield of the Money Market Portfolio of the Separate Account for
the seven day period ended December 31, 1995 was 4.03%. This effective yield was
computed by determining the net change, exclusive of capital changes, in the
value of a hypothetical pre-existing account having a balance of one
accumulation unit of the Series at the beginning of the period, subtracting a
hypothetical charge reflecting deductions from account values, and dividing the
difference by the value of the account at the beginning of the base period to
obtain the base period return, and then compounding the base period return by
adding 1, raising the sum to a power equal to 365 divided by 7, and subtracting
1 from the result, according to the following formula:
    

      EFFECTIVE YIELD = (BASE PERIOD RETURN + 1)365/7 - 1.

b. Other Funds. The average annual total return of the other Funds in the
Separate Account as of December 31, 1995 are as follows:*

   
<TABLE>
<CAPTION>
                                        Average Annual Total Returns
                                        ----------------------------
                                               1 year         5 years        Inception to Date
                                               ------         -------        -----------------
<S>                                            <C>            <C>            <C>
           Growth Portfolio                    33.70%                              14.48%

           Overseas Portfolio                  8.33%                               7.79%

           Asset Management Portfolio          15.51%                              7.00%

           Index 500 Portfolio                 35.58%                              15.51%

           T. Rowe Price Bond Series           15.33%          7.23%               6.65%

           T. Rowe Price Growth and            29.50%         14.64%               9.80%
           Income Series

           Equity-Income Portfolio                                                 31.26%

           Contrafund Portfolio                                                    37.37%

           Virtus U.S. Govt. Income                                                11.84%
           Series

</TABLE>
    

                                       10
<PAGE>   77
<TABLE>
<S>                                                                                <C>   
           Small Capitalization Portfolio                                          44.76%
</TABLE>


Average annual total return was computed by finding the average annual
compounded rates of return over the 1, 5, and 10 year periods that would equate
the initial amount invested to the ending redeemable value, according to the
following formula:

                                  P(1+T)n = ERV

Where:

      P       =      a hypothetical initial payment of $1,000
      T       =      average annual total return
      n       =      number of years
      ERV     =      ending redeemable value of a hypothetical $1,000 payment 
                     made at the beginning of the 1, 5, or 10 year periods (or
                     fractional portion thereof).

The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.

   
From inception to July 1983, Security Management reimbursed the T. Rowe Price
Growth and Income Series for expenses in excess of the maximum expense
limitation. These reimbursements were repaid from August 1983 to July 1986. The
T. Rowe Price Bond Series was reimbursed for excess expenses from inception to
July 1985, and repaid Security First for such reimbursements from August 1985 to
July 1993. Likewise, certain expenses of Virtus U.S. Government Income Series
and Index 500 Portfolio have been reimbursed by their investment advisers.
Reimbursement of expenses to a series increases average annual total returns,
and repayment of such reimbursements reduces these returns.
    

   
The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.
    

VOTING RIGHTS

Unless otherwise restricted by the plan under which a Contract is issued each
Owner will have the right to instruct Security First Life with respect to voting
the Fund Shares which are the assets underlying the Owner's interest in the
Separate Account, at all regular and special shareholders meetings. An
Annuitant's voting power with respect to Fund shares held by the Separate
Account declines during the time the Annuitant is receiving a Variable Annuity
based on the investment performance of the Separate Account, because amounts
attributable to the Annuitant's interest are being transferred annually to the
General Account to provide the variable payments.

SAFEKEEPING OF SECURITIES

Custody of all assets of the Separate Account are held by Security First Life.
The assets of each Separate Account Series will be kept physically segregated by
Security First Life and held separate from the assets of any other firm, person,
or corporation. Additional protection for the assets of the Separate Account is
afforded by fidelity bonds covering all of Security First Life's officers and
employees.

                                       11
<PAGE>   78
SERVICING AGENT

An administrative services agreement has been entered into between Security
First Life and SFG under which the latter has agreed to perform certain of the
administrative services relating to the Contracts and for the Separate Account.
SFG performs substantially all of the recordkeeping and administrative services
for the Separate Account. Security First Life has not paid fees to SFG for these
services.

INDEPENDENT AUDITORS

The financial statements of Security First Life and its Separate Account
included in this Statement of Additional Information and Registration Statement
have been audited by Ernst & Young LLP, independent auditors, for the periods
indicated in their reports thereon which appear elsewhere herein and in the
Registration Statement. The financial statements audited by Ernst & Young LLP
have been included in reliance on their reports, given on their authority as
experts in accounting and auditing.

   
LEGAL MATTERS

Legal matters concerning federal securities laws applicable to the issue and
sale of the variable annuity contracts have been passed upon by Routier and
Johnson, P.C., 1700 K Street, N.W., Washington, D.C. 20006.
    

STATE REGULATION OF SECURITY FIRST LIFE

   
Security First Life is subject to the laws of the state of Delaware governing
insurance companies and to regulation by the Delaware Commissioner of Insurance.
An annual statement, in a prescribed form, is filed with the Commissioner on or
before March 1 each year covering the operations of Security First Life for the
preceding year and its financial condition on December 31 of such year. Security
First Life's books and assets are subject to review or examination by the
Commissioner or his agents at all times, and a full examination of its
operations is usually conducted by the National Association of Insurance
Commissioners at least once in every three years. Security First Life was last
examined as of December 31, 1993. While Delaware insurance law prescribes
permissible investments for Security First Life, it does not prescribe
permissible investments for the Separate Account, nor does it involve
supervision of the investment management or policy of Security First Life.
    

In addition, Security First Life is subject to the insurance laws and
regulations of other jurisdictions in which it is licensed to operate. State
insurance laws generally provide regulations for the licensing of insurers and
their agents, govern the financial affairs of insurers, require approval of
policy forms, impose reserve requirements and require filing of an annual
statement. Generally, the insurance departments of these other jurisdictions
apply the laws of Delaware in determining permissible investments for Security
First Life.

FINANCIAL STATEMENTS

The financial statements of Security First Life contained herein should be
considered only for the purposes the of informing investors as to its ability to
carry out the contractual obligations as depositor under the Annuity contracts
and as custodian as described elsewhere herein and in the prospectus. The
financial statements of the Separate Account are also included in this Statement
of Additional Information.

                                       12
<PAGE>   79
                                                        '33 Act File No. 33-7094

                                  STATEMENT OF

                             ADDITIONAL INFORMATION

                     SECURITY FIRST LIFE SEPARATE ACCOUNT A

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

             INDIVIDUAL FLEXIBLE PAYMENT VARIABLE ANNUITY CONTRACTS

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



                      SECURITY FIRST LIFE INSURANCE COMPANY

                                   MAY 1, 1996

   
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the prospectus. A copy of the prospectus, dated May 1, 1996,
may be obtained without charge by writing to Security First Life Insurance
Company, P.O. Box 92193, Los Angeles, California 90009 or by telephoning 1 (800)
284-4536.
    



SF 135 R2S
<PAGE>   80
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                        Page
<S>                                                                     <C>
The Insurance Company                                                   3

The Separate Account                                                    3

The Funds                                                               3

Purchase of Securities Being Offered                                    5

Net Investment Factor                                                   6

Annuity Payments                                                        6

Withholding on Annuity Payments and Other Distributions                 8

Underwriters, Distribution of the Contracts                             8

Calculation of Performance Data                                         9

Voting Rights                                                           10

Safekeeping of Securities                                               10

Servicing Agent                                                         10

Independent Auditors                                                    10

Legal Matters                                                           10

State Regulation of Security First Life                                 10

Financial Statements                                                    11
</TABLE>


                                       2
<PAGE>   81
THE INSURANCE COMPANY

   
Security First Life Insurance Company ("Security First Life") is a wholly owned
subsidiary of Security First Group, Inc. ("SFG"). The common shares of SFG are
held by London Insurance Group, a Canadian insurance services corporation and
publicly-traded subsidiary of the Trilon Financial Corporation of Toronto,
Canada.
    

THE SEPARATE ACCOUNT

The Security First Life Separate Account A ("Separate Account") presently funds
the Contracts described in this Prospectus and group variable annuity contracts
on Forms SF 224FL, SF 226R1, SF 234 and SF 236. These group variable annuity
contracts are described in other prospectuses. The individual variable annuity
contracts ("Contracts") described in this Statement of Additional Information
and related prospectus are distinct contracts from the above described group
variable annuity contracts.

   
Amounts allocated to the Separate Account under the Contracts are invested in
the securities of five Funds: (i) Virtus Equity Series and Virtus U.S.
Government Income Series of the Security First Trust and (ii) the Money Market
Portfolio, the Growth Portfolio and the Overseas Portfolio of the Variable
Insurance Products Fund. The Separate Account is divided into a number of Series
of Accumulation and Annuity Units, five of which are offered under the Contract:
Series SV, Series SU, Series FM, Series FG, and Series FO corresponding
respectively to these five Funds.
    

THE FUNDS

Security First Trust (the "Trust") is a Massachusetts business trust which was
formed on February 13, 1987. Two of the series of the Trust are offered under
the contract:

   
The Virtus Equity Series (formerly Value Equity Series) seeks to provide growth
of capital and income. The Series pursues this objective by investing in common
stocks of high quality companies. The Series is managed to take advantage of
trends in the stock market that favor different styles of stock selection (value
or growth) and different sizes of companies (consisting of large, medium and
small).

The Virtus U.S. Government Income Series (formerly U.S. Government Income
Series) seeks to provide current income. The Series pursues this objective by
investing in a professionally managed, diversified portfolio limited primarily
to U.S. government securities.

The Trust has contracted to receive investment advice and management from
Security First Investment Management Corporation ("Security Management") a
wholly-owned subsidiary of SFG, and an affiliate of Security First Life and
Security First Financial, Inc. Security Management receives an annual fee,
accrued daily and payable in monthly installments, based on 0.90% of the average
daily net assets of each Series. Security Management has entered into
Sub-Advisory Agreements with Virtus Capital Management, Inc. ("Virtus"), a
wholly owned subsidiary of Signet Banking Corp., under which Virtus provides
investment advisory services to each of the two series of Security First Trust
described above. Virtus receives an annual fee from Security Management, accrued
daily and payable in monthly installments, equal to 0.75% of average daily net
assets of each of the Series.

In 1995 the fees charged by Security Management and Virtus to the Virtus Equity
Series and the Virtus U.S. Government Income Series were voluntarily reduced to
 .08% and .14%, respectively.
    

                                       3
<PAGE>   82
Variable Insurance Products Fund is a Massachusetts business trust. It is
divided into separate portfolios, three of which are offered under the Contracts
- - the Money Market Portfolio, the Growth Portfolio and the Overseas Portfolio.

The Money Market Portfolio seeks to obtain as high a level of current income as
is consistent with preserving capital and providing liquidity. The portfolio
will invest only in high quality U.S. dollar denominated money market securities
of domestic and foreign issuers.

Growth Portfolio seeks to achieve capital appreciation. The Portfolio normally
purchases common stocks, although its investments are not restricted to any one
type of security. Capital appreciation may also be found in other types of
securities, including bonds and preferred stocks.

Overseas Portfolio seeks long term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.

Fidelity Management & Research Company is the investment adviser to the Money
Market Portfolio, the Growth Portfolio and the Overseas Portfolio.

Money Market Portfolio's advisory fee is made up of two components: (a) a basic
fee rate and (b) an income-based component. The basic fee rate is the sum of the
following two components:

   
      a. A group fee rate based on the monthly average net assets of all the
      mutual funds advised by FMR. This rate cannot rise above .37%, and it
      drops as total assets in all these funds rise. The effective group fee
      rate for December 1995 was .1482%.
    

      b.  An individual fund fee rate of 0.03%.

One-twelfth of the combined annual fee rate is applied to the fund's net assets
averaged over the most recent month, giving dollar amount which is the fee for
that month. If the fund's gross yield is 5% or less, the basic fee is the total
management fee. The income-based component is added to the basic fee only when
the fund's yield is greater than 5%. The income-based fee is 6% of that portion
of the fund's yield that represents a gross yield of more than 5% per year. The
maximum income-based component is .24%.

   
For fiscal year 1995, the Portfolio's Management fee was .24% of the average net
assets of the Portfolio, approximately $2.40 for every $1,000 of the Portfolio's
average net assets.
    

Growth and Overseas Portfolio's annual fee rate is the sum of two components:

   
      a. A group fee rate based on the monthly average net assets of all the
      mutual funds advised by FMR. This rate cannot rise above .52%, and it
      drops as total assets in all these funds rise. The effective group fee
      rate for December 1995 was .3097%.
    

      b. An individual fund fee rate of .30% for Growth Portfolio and .45% for
      Overseas Portfolio.

One-twelfth of the combined annual rate is applied to each Portfolio's net
assets averaged over the most recent month, giving a dollar amount which is the
fee for that month.

   
In fiscal year 1995, FMR's fee was .61% and .76% of Growth and Overseas
Portfolio's average net assets, respectively, or $6.10 and $7.60 for every
$1,000 of each respective Portfolio's average net assets. Overseas Portfolio's
total fee may be higher than those of other 


                                       4
<PAGE>   83
mutual funds because of the greater complexity, expense and commitment of
resources involved in international investing.

The mutual funds advised by FMR have over 25 million shareholders accounts with
a total value of more than 374 billion.
    

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in a portfolio of common stocks is to provide Annuitants with
Annuity Payments which will tend to remain level during a period when the
economy is relatively stable and to provide increased Annuity Payments during
periods of economic growth and inflation. It is believed that the value of such
Separate Account investment will, over the long-term, tend to reflect changes in
the general economic price level. Historically, the value of diversified
portfolio of common stocks held for an extended period of time has tended to
rise during periods of economic growth and inflation. However, there is no exact
correlation between the two. In some periods, the value of a common stock
portfolio has declined while the cost of living has increased.

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in fixed income securities is to provide Annuitant with Annuity
Payments which will be higher in amount than those provided by conventional
Fixed Annuities. It should be recognized, however, that a portfolio consisting
of nonconvertible fixed income securities and which is designed to obtain a high
level of current yield involves market risks that are not found in a Fixed
Annuity and differ from those found in a Variable Annuity that is invested
primarily in common stocks.

   
The market value of nonconvertible fixed income securities usually reflects
yields then generally available in securities of similar quality and type. Based
upon historical analysis, when interest rates decline, the market value of a
portfolio already invested at higher interest rates may be expected to rise if
such securities are not subject to call at the option of the issuer. Conversely,
when such interest rates increase, the market value of a portfolio already
invested at lower interest rates may be expected to decline. The Virtus U.S.
Government Income Series may, pursuant to its investment policies, invest a
significant portion of its assets in long-term fixed income securities. Because
of this, Owners who select this Series as the basis for Annuity payments should
recognize that Annuity Payments may decrease during periods when interest rates
and general prices are rising.
    

Owners should carefully consider which of the underlying Funds is best suited to
their long-term needs.

PURCHASE OF SECURITIES BEING OFFERED

   
Purchase Payments may be made at any time. The minimum initial Purchase Payment
is $1,000 with each additional Purchase Payment subject to a $100 minimum.
Purchase Payments to the combination fixed and variable annuity contract may be
allocated to the General Account, Separate Account or allocated between these
Accounts. Amounts in Separate Account Series may be converted to amounts in any
one or more other Separate Account Series at any time. Amounts invested in the
fixed and variable annuity contract may also be transferred from the Separate
Account to the General Account; however, amounts may not be transferred from the
General Account to the Separate Account except upon annuitization.
    


                                       5
<PAGE>   84
NET INVESTMENT FACTOR

The Separate Account net investment factor is an index of the percentage change
(adjusted for distributions by the Fund and the deduction of the actuarial risk
fee) in the net asset value of each Fund in which the Series in invested, since
the preceding Business Day. The Separate Account net investment factor for each
Series of Accumulation Units is determined for any Business Day by dividing (i)
the net asset value of a share of the Fund which is represented by such Series
at the close of business on such day, plus the per share amount of any
distributions made by such Fund on such day by (ii) the net asset value of a
share of such Fund determined as of the close of business on the preceding
Business Day and then subtracting from the result the daily factors for
administration fees, mortality risks and administrative expense risks (.003836%)
for each calendar day between the preceding Business Day and the end of the
current Business Day.

ANNUITY PAYMENTS

Basis of Variable Benefits

The Variable Annuity benefits rates used in determining Annuity Payments under
the Contracts are based on actuarial assumptions, reflected in tables in the
Contracts, as to the expected mortality and adjusted age and the form of Annuity
selected. The mortality basis for these tables is Security First Life's Modified
Select Annuity Mortality Table, projected to the year 2000 on Projection Scale
C, with interest at 4.25% for all functions involving life contingencies and the
portion of any period certain beyond 10 years, and 3.25% for the first 10 years
of any certain period. Adjusted age in those tables means actual age to the
nearest birthday at the time the first payment is due, adjusted according to the
following table:

<TABLE>
<CAPTION>
                        Calendar                             Adjusted
                     Year of Birth                            Age is
                     -------------                            ------
<S>                                                     <C>                                      
                      Before 1916                           Actual Age
                      1916 - 1935                       Actual Age Minus 1
                      1936 - 1955                       Actual Age Minus 2
                      1956 - 1975                       Actual Age Minus 3
                      1976 - 1995                       Actual Age Minus 4
</TABLE>


Determination of Amount of Monthly Variable Annuity Payments For First Year

The Separate Account value used to establish the monthly Variable Annuity
Payment for the first year consists of the value of Accumulation Units of each
Series of the Separate Account credited to a Contract Owner on the last day of
the second calendar week before the Annuity Date. The Contracts contain tables
showing monthly payment factors and Annuity premium rates per $1,000 of Separate
Account value to be applied under Options 1 through 4.

At the beginning of the first payment year an amount is transferred from the
Separate Account to the General Account and level monthly Annuity Payments for
the year are made out of the General Account for that year. That amount to be
transferred is determined by multiplying the Annuity premium rate per $1,000 set
forth in Contract tables by the number of thousands of dollars of Separate
Account value credited to a Contract Owner. The level monthly payment for the
first payment year is then determined by multiplying the amount transferred (the
Annuity premium) by the monthly payment factor in the same table. In the event
the Contract involved has Separate Account Accumulation Units in more than one
Series, the total monthly 

                                       6
<PAGE>   85
Annuity Payment for the first year is the sum of the monthly Annuity Payments,
determined in the same manner as above, for each Series.

At the time the first year's monthly payments are determined, a number of
Annuity Units for each Separate Account Series is also established for the
Annuitant by dividing the monthly payment derived from that Series for the first
year by the Separate Account Annuity Unit values for the Series on the last
Business Day of the second calendar week before the first Annuity Payment is
due. The number of Annuity Units remains fixed during the Annuity period unless
Annuity Units are converted to another Series.

Determination of Amount of Monthly Variable Annuity Payments for Second and
Subsequent Years

As of each anniversary of the Annuity Date, Security First Life will determine
the amount of the monthly Variable Annuity Payments for the year then beginning.
Separate determinations will be made for each Separate Account Payments for the
year then beginning. Separate determinations will be made for each Separate
Account Series in which the Annuitant has Annuity Units, with the total Annuity
Payment being the sum of the payments derived from the Series. The amount of
monthly payments for any Separate Account Series for any year after the first
will be determined by multiplying the number of Annuity Units for that Series by
the Annuity Unit value for that Series for the Valuation Period in which the
first payment for the year is due. It will be Security First Life's practice to
mail Variable Annuity Payments no later than seven days after the last day of
the Valuation Period upon which they are based or the monthly anniversary
thereof.

The objective of a Variable Annuity contract is to provide level payments during
periods when the economy is relatively stable and to reflect as increased
payments only the excess of investment results flowing from inflation or an
increase in productivity. The achievement of this objective will depend in part
upon the validity of the assumption that the net investment return of the
Separate Account equals the Assumed Investment Return during periods of stable
prices. Subsequent years' payments will be smaller than, equal to or greater
than the first year's payments depending on whether the actual net investment
return for the Separate Account is smaller than equal to or greater than the
Assumed Investment Return.

Annuity Unit Value

The initial value of an Annuity Unit is $5 for each Series for the first
Valuation Period as of which the first Variable Annuity Payment from such Series
is made. The value of an Annuity Unit for each Series on any later date is
determined by multiplying the value of an Annuity Unit at the end of the
preceding Valuation Period by the "Annuity change factor" for the second
preceding Valuation Period. The Annuity change factor is an adjusted measurement
of the investment performance of the Fund since the end of the preceding
Valuation Period. The Annuity change factor is determined by dividing the value
of an Accumulation Unit at the end of the Valuation Period by the value of an
Accumulation Unit at the end of the preceding Valuation Period and multiplying
the result by a neutralization factor.

Variable Annuity Payments for each year after the first reflect variations in
the investment performance of the Separate Account above and below an Assumed
Investment Return. This assumed investment rate is included for purposes of
actuarial computations and does not relate to the actual investment performance
of the underlying Fund. Therefore, the Assumed Investment Return must be
"neutralized" in computing the Annuity change factor. For weekly Valuation
Periods and a 4.25% Assumed Investment Return, the neutralization factor is
0.9991999.

                                       7
<PAGE>   86
WITHHOLDING ON ANNUITY PAYMENTS AND OTHER DISTRIBUTIONS

Security First Life is required to withhold federal income tax on Contract
distributions (such as Annuity Payments, lump sum distributions or partial
surrenders). However, recipients of Contract distributions are allowed to make
an election not to have federal income tax withheld. After such election is made
with respect to Annuity Payments, an Annuitant may revoke the election at any
time, and thereafter commence withholding. In such a case, Security First Life
will notify the payee at least annually of his or her right to change such
election.

The withholding rate followed by Security First Life will be applied only
against the taxable portion of Contract distributions. Federal tax will be
withheld from Annuity Payments pursuant to the recipient's withholding
certificate. If no withholding certificate is filed with Security First Life,
federal tax will be withheld from Annuity Payments on the basis that the payee
is married with three withholding exemptions. Federal tax on the taxable portion
of a partial or total surrender (i.e., non-periodic distribution) generally will
be withheld at a flat 10% rate. In the case of a plan qualified under Sections
401(a) or 403(a) of the Code, if the balance to the credit of a participant in a
plan is distributed within one taxable year to the recipient ("total
distribution"), the amount of withholding will approximate the federal income
tax on a lump sum distribution. If a total distribution is made from such a plan
or a tax-sheltered annuity on account of the participant's death, the amount of
withholding will reflect the exclusion from federal income tax for
employer-provided death benefits.

   
Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10 years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in the case of a 401 plan or to another eligible contract
in the case of a 403(b) plan in a direct trustee-to-trustee transfer, no
withholding will be required.
    

Payees are required by law to provide Security First Life (as payor) with their
correct taxpayer identification number ("TIN"). If the payee is an individual,
the TIN is the same as his or her social security number. If the payee elects
not to have federal income tax withheld on an Annuity Payment or a nonperiodic
distribution and a correct TIN has not been provided, such election is
ineffective, and such payment will be subject to withholding as noted above.

UNDERWRITERS, DISTRIBUTION OF THE CONTRACTS

   
The Contracts will be sold as a continuous offering by individuals who are
appropriately licensed as insurance agents of Security First Life for the sale
of life insurance and Variable Annuity Contracts in the state where the sale is
made. In addition, these individuals will be registered representatives of the
principal underwriter, Security First Financial, Inc., or of other
broker-dealers registered under the Securities Exchange Act of 1934 whose
registered representatives are authorized by applicable law to sell Variable
Annuity Contracts issued by Security First Life. Commissions on sales of
contracts range from 0% to 8.5%. Agents are paid from the General Account of
Security First Life. Such commissions bear no direct relationship to any of the
charges under the Contracts. It is expected that the Contracts will be sold in
49 states and the District of Columbia. No direct underwriting commissions are
paid to Security First Financial, Inc.
    

                                       8
<PAGE>   87
CALCULATION OF PERFORMANCE DATA

   
a. Money Market Portfolio. The yield of the Money Market Portfolio of the
Separate Account for the seven day period ended December 31, 1995, was 4.08%.
This yield was computed by determining the net change, exclusive of capital
changes, in the value of a hypothetical pre-existing account having a balance of
one accumulation unit of the Series at the beginning of the period, subtracting
a hypothetical charge reflecting deductions from account values, and dividing
the difference by the value of the account at the beginning of the base period
to obtain the base period return, and multiplying the base period return by
(365/7) with the resulting yield figure carried to a least the nearest hundredth
of one percent.

The effective yield of the Money Market Portfolio of the Separate Account for
the seven day period ended December 31, 1995, was 4.16%. This effective yield
was computed by determining the net change, exclusive of capital changes, in the
value of a hypothetical pre-existing account having a balance of one
accumulation unit of the Series at the beginning of the period, subtracting a
hypothetical charge reflecting deductions from account values, and dividing the
difference by the value of the account at the beginning of the base period to
obtain the base period return, and then compounding the base period return by
adding 1, raising the sum to a power equal to 365 divided by 7, and subtracting
1 from the result, according to the following formula:
    

      EFFECTIVE YIELD = (BASE PERIOD RETURN + 1)365/7 - 1.

   
b. Other Funds. The average annual total return of the other Funds in the
Separate Account as of December 31, 1995 are as follows:

<TABLE>
<CAPTION>
                                              Average Annual Total Returns
                                              ----------------------------

                                                             1 Year              Inception to Date
                                                             ------              -----------------
<S>                                                          <C>                 <C>
          Virtus Equity Series                               26.53%                    7.51%

          Virtus U.S. Government Income Series               12.20%                    3.16%

          Growth Portfolio                                   33.89%                    23.53%

          Overseas Portfolio                                  8.43%                    3.32%
</TABLE>
    

Average annual total return was computed by finding the average annual
compounded rates of return over the 1, 5, and 10 year periods that would equate
the initial amount invested to the ending redeemable value, according to the
following formula:

                                  P(1+T)n = ERV

Where:

     P = hypothetical initial payment of $1,000
     T = average annual total return
     n = number of years
     ERV  = ending redeemable value of a hypothetical $1,000 payment made at the
            beginning of the 1, 5, or 10 year periods (or fractional portion 
            thereof).

                                       9
<PAGE>   88
The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.

VOTING RIGHTS

Unless otherwise restricted by the plan under which a Contract is issued each
Owner will have the right to instruct Security First Life with respect to voting
the Fund Shares which are the assets underlying the Owner's interest in the
Separate Account, at all regular and special shareholders meetings. An
Annuitant's voting power with respect to Fund shares held by the Separate
Account declines during the time the Annuitant is receiving a Variable Annuity
based on the investment performance of the Separate Account, because amounts
attributable to the Annuitant's interest are being transferred annually to the
General Account to provide the variable payments.

SAFEKEEPING OF SECURITIES

Custody of all assets of the Separate Account are held by Security First Life.
The assets of each Separate Account Series will be kept physically segregated by
Security First Life and held separate from the assets of any other firm, person,
or corporation. Additional protection for the assets of the Separate Account is
afforded by fidelity bonds covering all of Security First Life's officers and
employees.

SERVICING AGENT

An administrative services agreement has been entered into between Security
First Life and Security First Group under which the latter has agreed to perform
certain of the administrative services relating to the Contracts and for the
Separate Account. Security First Group performs substantially all of the
recordkeeping and administrative services for the Separate Account. Security
First Life has not paid fees to Security First Group for these services.

INDEPENDENT AUDITORS

The financial statements of Security First Life Insurance Company and Security
First Life Separate Account A included in this Statement of Additional
Information and Registration Statement have been audited by Ernst & Young LLP,
independent auditors, for the periods indicated in their reports thereon which
appear elsewhere herein and in the Registration Statement. The financial
statements audited by Ernst & Young LLP have been included in reliance on their
reports, given on their authority as experts in accounting and auditing.

   
LEGAL MATTERS

Legal matters concerning federal securities laws applicable to the issue and
sale of the variable annuity contracts have been passed upon by Routier and
Johnson, P.C., 1700 K Street, N.W., Washington, D.C. 20006.
    

STATE REGULATION OF SECURITY FIRST LIFE

   
Security First Life is subject to the laws of the state of Delaware governing
insurance companies and to regulation by the Delaware Commissioner of Insurance.
An annual statement, in a prescribed form, is filed with the Commissioner on or
before March 1 each year covering the operations of Security First Life for the
preceding year and its financial 

                                       10
<PAGE>   89
condition on December 31 of such year. Security First Life's books and assets
are subject to review or examination by the Commissioner or his agents at all
times, and a full examination of its operations is usually conducted by the
National Association of Insurance Commissioners at least once in every three
years. Security First Life was last examined as of December 31, 1993. While
Delaware insurance law prescribes permissible investments for Security First
Life, it does not prescribe permissible investments for the Separate Account,
nor does it involve supervision of the investment management or policy of
Security First Life.
    

In addition, Security First Life is subject to the insurance laws and
regulations of other jurisdictions in which it is licensed to operate. State
insurance laws generally provide regulations for the licensing of insurers and
their agents, govern the financial affairs of insurers, require approval of
policy forms, impose reserve requirements and require filing of an annual
statement. Generally, the insurance departments of these other jurisdictions
apply the laws of Delaware in determining permissible investments for Security
First Life.

FINANCIAL STATEMENTS

The financial statements of Security First Life contained herein should be
considered only for the purposes the of informing investors as to its ability to
carry out the contractual obligations as depositor under the Annuity contracts
as described elsewhere herein and in the prospectus. The financial statements of
the Separate Account are also included in this Statement of Additional
Information.

                                       11
<PAGE>   90
                           '33 Act File No. 33-7094





                                  STATEMENT OF

                             ADDITIONAL INFORMATION



                     SECURITY FIRST LIFE SEPARATE ACCOUNT A



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

             INDIVIDUAL FLEXIBLE PAYMENT VARIABLE ANNUITY CONTRACTS

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



                      SECURITY FIRST LIFE INSURANCE COMPANY

   
                                   MAY 1, 1996





This Statement of Additional Information is not a prospectus and should be read
in conjunction with the prospectus. A copy of the prospectus, dated May 1, 1996
may be obtained without charge by writing to Security First Life Insurance
Company, P.O. Box 92193, Los Angeles, California 90009 or by telephoning 1
(800)284-4536.
    



SF 135 R2V
<PAGE>   91
                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                        Page
<S>                                                                     <C>
The Insurance Company                                                   3

The Separate Account                                                    3

The Funds                                                               3

Purchase of Securities Being Offered                                    7

Net Investment Factor                                                   7

Annuity Payments                                                        7

Withholding on Annuity Payments and Other Distributions                 9

Underwriters, Distribution of the Contracts                             10

Calculation of Performance Data                                         10

Voting Rights                                                           12

Safekeeping of Securities                                               12

Servicing Agent                                                         12

Independent Auditors                                                    12

Legal Matters                                                           12

State Regulation of Security First Life                                 12

Financial Statements                                                    13
</TABLE>


                                       2
<PAGE>   92
THE INSURANCE COMPANY

   
Security First Life Insurance Company ("Security First Life") is a wholly owned
subsidiary of Security First Group, Inc. ("SFG"). The common shares of SFG are
held by London Insurance Group, a Canadian insurance services corporation and a
publicly-traded subsidiary of the Trilon Financial Corporation of Toronto,
Canada.
    

THE SEPARATE ACCOUNT

The Security First Life Separate Account A ("Separate Account") presently funds
the Contracts described in this Prospectus and group variable annuity contracts
on Forms SF 224FL, SF 226R1, SF 234 and SF 236. These group variable annuity
contracts are described in other prospectuses. The individual variable annuity
contracts ("Contracts") described in this Statement of Additional Information
and related prospectuses are distinct contracts from the above described group
variable annuity contacts.

   
Amounts allocated to the Separate Account under the Contracts are invested in
the securities of eight Funds: (i) the Virtus Equity Series and Virtus U.S.
Government Income Series of Security First Trust; (ii) the Money Market
Portfolio, Growth Portfolio and Overseas Portfolio of the Variable Insurance
Products Fund; (iii) the Contrafund Portfolio of the Variable Insurance Products
Fund II; (iv) the International Portfolio of the Scudder Variable Life
Investment Fund; and (v) the Small Capitalization Portfolio of The Alger
American Fund. The Separate Account is divided into a number of Series of
Accumulation and Annuity Units, eight of which are offered under the Contracts:
Series SV (Virtus Equity Series), Series SU (Virtus U.S. Government Income
Series), Series FM (Money Market Portfolio), Series FG (Growth Portfolio),
Series FO (Overseas Portfolio), Series FC (Contrafund Portfolio), Series SI
(International Portfolio) and Series SC (Small Capitalization Portfolio).
    

THE FUNDS

Security First Trust (the "Trust") is a Massachusetts business trust which was
formed on February 13, 1987 and is registered with the Securities and Exchange
Commission as an open-end management investment company.

   
Virtus Equity Series (formerly Value Equity Series) seeks to provide growth of
capital and income. The Series pursues this objective by investing in common
stocks of high quality companies. The Series is managed to take advantage of
trends in the stock market that favor different styles of stock selection (value
or growth and different sizes of companies, consisting of large, medium and
small).

Virtus U.S. Government Income Series (formerly U.S. Government Income Series)
seeks to provide current income. The Series pursues this objective by investing
in a professionally managed, diversified portfolio limited primarily to U.S.
government securities.
    

The Variable Insurance Products Fund and Variable Insurance Products Fund II are
Massachusetts business trusts and are registered with the Securities and
Exchange Commission as open-end, diversified management investment companies.

Money Market Portfolio seeks to obtain as high a level of current income as is
consistent with preserving capital and providing liquidity. The Portfolio will
invest 

                                       3
<PAGE>   93
only in high quality U.S. dollar denominated money market securities of domestic
and foreign issuers.

Growth Portfolio seeks to achieve capital appreciation. The Portfolio normally
purchases common stocks, although its investments are not restricted to any one
type of security. Capital appreciation may also be found in other types of
securities, including bonds and preferred stocks.

Overseas Portfolio seeks long term growth of capital primarily through
investments in foreign securities. Overseas Portfolio provides a means for
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.

Contrafund Portfolio seeks capital appreciation by investing in equity or debt
securities of companies that the investment adviser believes to be undervalued
due to an overly pessimistic appraisal by the public.

Scudder Variable Life Investment Fund is a Massachusetts business trust which is
divided into separate Portfolios. The following Portfolio is available under the
Contracts.

International Portfolio seeks long-term growth of capital primarily through
diversified holdings of marketable foreign equity investments. The Portfolio
invests in companies, wherever organized, which do business primarily outside
the United States. The Portfolio intends to diversify investments among several
countries and to have represented in its holdings business activities in not
less than three different countries. The Portfolio does not intend to
concentrate investments in any particular industry.

The investment advisor of the Scudder Variable Life Investment Fund is Scudder.

The Alger American Fund is a Massachusetts business trust which has a number of
portfolios, one of which is available under the Contracts:

   
Small Capitalization Portfolio seeks long-term capital appreciation by investing
in a diversified, actively managed portfolio of equity securities, primarily of
companies within the range of companies included in the Russell 2000 Growth
Index.. Income is a consideration in the selection of investments but is not an
investment objective of the Portfolio.
    

   
Security First Trust has contracted to receive investment advice and management
services from Security First Investment Management Corporation ("Security
Management") a wholly-owned subsidiary of SFG, and an affiliate of Security
First Life and Security First Financial, Inc. Security Management receives an
annual fee, accrued daily and payable in monthly installments, based on .90% for
the Virtus Equity Series and Virtus U.S. Government Income Series. Security
Management has entered into a sub-advisory agreement with Virtus Capital
Management, Inc. ("Virtus") under which Virtus provides investment advisory
services to the Virtus Equity Series and the Virtus U.S. Government Income
Series of the Trust. Virtus is entitled to receive an annual fee from Security
Management, accrued daily and payable in monthly installments equal to 0.75% of
average daily net assets of each of the Series. In 1995 the fees charged by
Security Management and Virtus to the Virtus Equity Series and Virtus U.S.
Government Income Series were voluntarily reduced to .08% and .14%,
respectively.
    

                                       4
<PAGE>   94
Variable Insurance Products Fund and Variable Insurance Products Fund II have
entered into investment advisory agreements with Fidelity Management and
Research Company ("FMR") under which it received investment advisory fees.

Money Market Portfolio's advisory fee is made up of two components: (a) a basic
fee rate and (b) an income-based component. The basic fee rate is the sum of the
following two components:

   
       a. A group fee rate based on the monthly average net assets of all the
       mutual funds advised by FMR. This rate cannot rise above .37%, and it
       drops as total assets in all these funds rise. The effective group fee
       rate for December 1995 was .1482%.
    

       b.  An individual fund fee rate of 0.03%.

One-twelfth of the combined annual fee rate is applied to the fund's net assets
averaged over the most recent month, giving a dollar amount which is the fee for
that month. If the fund's gross yield is 5% or less, the basic fee is the total
management fee. The income-based component is added to the basic fee only when
the fund's yield is greater than 5%. The income-based fee is 6% of that portion
of the fund's yield that represents a gross yield of more than 5% per year. The
maximum income-based component is .24%.

   
For fiscal year 1995, the Portfolio's Management fee was .24% of the average net
assets of the Portfolio--approximately $2.40 every $1,000 of the Portfolio's
average net assets.
    

Growth, Overseas and Contrafund Portfolios' annual fee rates are the sum of two
components:

   
       a. A group fee rate based on the monthly average net assets of all the
       mutual funds advised by FMR. This rate cannot rise above .52%, and it
       drops as total assets in all these funds rise. The effective group fee
       rate for December 1995 was .3097%.
    

       b. An individual fund fee rate of .30% for the Growth Portfolio, .45% for
       the Overseas Portfolio, .20% for the Equity-Income Portfolio, .40% for
       the Asset Manager Portfolio and .30% for the Contrafund Portfolio.

One-twelfth of the combined annual rate is applied to each Portfolio's net
assets averaged over the most recent month, giving a dollar amount which is the
fee for that month.

   
In fiscal year 1995, FMR's fee was .61% of Growth Portfolio's average net assets
($6.10 per $1,000), .76% of Overseas Portfolio's average net assets ($7.60 per
$1,000), and .61% of Contrafund Portfolio's average net assets ($6.10 per
$1,000). Overseas Portfolio's total fee may be higher than those of other mutual
funds because of the greater complexity, expense and commitment of resources
involved in international investing.

The mutual funds advised by FMR have over 25 million shareholder accounts with a
total value of more than 374 billion.
    

The Scudder Variable Life Investment Fund has contracted to receive investment
advice and management services from Scudder, Stevens & Clark, Inc. ("Scudder").
Scudder receives an annual fee, accrued daily and paid monthly, equal to .875%
of the International Portfolio's average daily net assets.

                                       5
<PAGE>   95
The Alger American Fund has contracted to receive investment advice and
management services from Fred Alger Management, Inc. ("Alger Management"), a
wholly owned subsidiary of Alger Associates, Inc. Alger Management receives an
annual fee, accrued daily and paid monthly, equal to .85% of the Small
Capitalization Portfolio's average daily net assets.

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in a portfolio of common stocks is to provide Annuitants with
Annuity Payments which will tend to remain level during a period when the
economy is relatively stable and to provide increased Annuity Payments during
periods of economic growth and inflation. It is believed that the value of such
Separate Account investment will, over the long-term, tend to reflect changes in
the general economic price level. Historically, the value of diversified
portfolio of common stocks held for an extended period of time has tended to
rise during periods of economic growth and inflation. However, there is no exact
correlation between the two. In some periods, the value of a common stock
portfolio has declined while the cost of living has increased.

The primary objective of a Variable Annuity having Separate Account assets
chiefly invested in fixed income securities is to provide Annuitant with Annuity
Payments which will be higher in amount than those provided by conventional
Fixed Annuities. It should be recognized, however, that a portfolio consisting
of nonconvertible fixed income securities and which is designed to obtain a high
level of current yield involves market risks that are not found in a Fixed
Annuity and differ from those found in a Variable Annuity that is invested
primarily in common stocks.

   
The market value of nonconvertible fixed income securities usually reflects
yields then generally available in securities of similar quality and type. Based
upon historical analysis, when interest rates decline, the market value of a
portfolio already invested at higher interest rates may be expected to rise if
such securities are not subject to call at the option of the issuer. Conversely,
when such interest rates increase, the market value of a portfolio already
invested at lower interest rates may be expected to decline. The Virtus U.S.
Government Income Series may, pursuant to its investment policies, invest a
significant portion of its assets in long-term fixed income securities. Because
of this, Owners who select this Series as the basis for Annuity payments should
recognize that Annuity Payments may decrease during periods when interest rates
and general prices are rising.
    

Owners should carefully consider which of the underlying Funds is best suited to
their long-term needs.

PURCHASE OF SECURITIES BEING OFFERED

Purchase Payments may be made at any time. The minimum initial Purchase Payment
is $1,000 with each additional Purchase Payment subject to a $100 minimum.
Purchase Payments to the Contract may only be allocated among the Series of the
Separate Account. Amounts in Separate Account Series may be converted to amounts
in any one or more other Separate Account Series at any time.

                                       6
<PAGE>   96
NET INVESTMENT FACTOR

The Separate Account net investment factor is an index of the percentage change
(adjusted for distributions by the Fund and the deduction of the actuarial risk
fee) in the net asset value of each Fund in which the Series in invested, since
the preceding Business Day. The Separate Account net investment factor for each
Series of Accumulation Units is determined for any Business Day by dividing (i)
the net asset value of a share of the Fund which is represented by such Series
at the close of business on such day, plus the per share amount of any
distributions made by such Fund on such day by (ii) the net asset value of a
share of such Fund determined as of the close of business on the preceding
Business Day and then subtracting from the result the daily factors for
administration fees, mortality risks and administrative expense risks (.003836%)
for each calendar day between the preceding Business Day and the end of the
current Business Day.

ANNUITY PAYMENTS

Basis of Variable Benefits

The Variable Annuity benefits rates used in determining Annuity Payments under
the Contracts are based on actuarial assumptions, reflected in tables in the
Contracts, as to the expected mortality and adjusted age and the form of Annuity
selected. The mortality basis for these tables is Security First Life's Modified
Select Annuity Mortality Table, projected to the year 2000 on Projection Scale
C, with interest at 4.25% for all functions involving life contingencies and the
portion of any period certain beyond 10 years, and 3.25% for the first 10 years
of any certain period. Adjusted age in those tables means actual age to the
nearest birthday at the time the first payment is due, adjusted according to the
following table:

<TABLE>
<CAPTION>
                  Calendar Year                     Adjusted
                    of Birth                         Age Is
                    --------                         ------
<S>                                            <C>                                
                   Before 1916                     Actual Age
                   1916 - 1935                 Actual Age Minus 1
                   1936 - 1955                 Actual Age Minus 2
                   1956 - 1975                 Actual Age Minus 3
                   1976 - 1995                 Actual Age Minus 4
</TABLE>

Determination of Amount of Monthly Variable Annuity Payments For First Year

The Separate Account value used to establish the monthly Variable Annuity
Payment for the first year consists of the value of Accumulation Units of each
Series of the Separate Account credited to a Contract Owner on the last day of
the second calendar week before the Annuity Date. The Contracts contain tables
showing monthly payment factors and Annuity premium rates per $1,000 of Separate
Account value to be applied under Options 1 through 4.

At the beginning of the first payment year an amount is transferred from the
Separate Account to the General Account and level monthly Annuity Payments for
the year are made out of the General Account for that year. That amount to be
transferred is determined by multiplying the Annuity premium rate per $1,000 set
forth in Contract tables by the number of thousands of dollars of Separate
Account value credited to a Contract Owner. The level monthly payment for the
first payment year is then 


                                       7
<PAGE>   97
determined by multiplying the amount transferred (the Annuity premium) by the
monthly payment factor in the same table. In the event the Contract involved has
Separate Account Accumulation Units in more than one Series, the total monthly
Annuity Payment for the first year is the sum of the monthly Annuity Payments,
determined in the same manner as above, for each Series.

At the time the first year's monthly payments are determined, a number of
Annuity Units for each Separate Account Series is also established for the
Annuitant by dividing the monthly payment derived from that Series for the first
year by the Separate Account Annuity Unit values for the Series on the last
Business Day of the second calendar week before the first Annuity Payment is
due. The number of Annuity Units remains fixed during the Annuity period unless
Annuity Units are converted to another Series.

Determination of Amount of Monthly Variable Annuity Payments for Second and
Subsequent Years

As of each anniversary of the Annuity Date, Security First Life will determine
the amount of the monthly Variable Annuity Payments for the year then beginning.
Separate determinations will be made for each Separate Account Payments for the
year then beginning. Separate determinations will be made for each Separate
Account Series in which the Annuitant has Annuity Units, with the total Annuity
Payment being the sum of the payments derived from the Series. The amount of
monthly payments for any Separate Account Series for any year after the first
will be determined by multiplying the number of Annuity Units for that Series by
the Annuity Unit value for that Series for the Valuation Period in which the
first payment for the year is due. It will be Security First Life's practice to
mail Variable Annuity Payments no later than seven days after the last day of
the Valuation Period upon which they are based or the monthly anniversary
thereof.

The objective of a Variable Annuity contract is to provide level payments during
periods when the economy is relatively stable and to reflect as increased
payments only the excess of investment results flowing from inflation or an
increase in productivity. The achievement of this objective will depend in part
upon the validity of the assumption that the net investment return of the
Separate Account equals the Assumed Investment Return during periods of stable
prices. Subsequent years' payments will be smaller than, equal to or greater
than the first year's payments depending on whether the actual net investment
return for the Separate Account is smaller than equal to or greater than the
Assumed Investment Return.

Annuity Unit Value

The initial value of an Annuity Unit is $5 for each Series for the first
Valuation Period as of which the first Variable Annuity Payment from such Series
is made. The value of an Annuity Unit for each Series on any later date is
determined by multiplying the value of an Annuity Unit at the end of the
preceding Valuation Period by the "Annuity change factor" for the second
preceding Valuation Period. The Annuity change factor is an adjusted measurement
of the investment performance of the Fund since the end of the preceding
Valuation Period. The Annuity change factor is determined by dividing the value
of an Accumulation Unit at the end of the Valuation Period by the value of an
Accumulation Unit at the end of the preceding Valuation Period and multiplying
the result by a neutralization factor.

Variable Annuity Payments for each year after the first reflect variations in
the investment performance of the Separate Account above and below an Assumed

                                       8
<PAGE>   98
Investment Return. This assumed investment rate is included for purposes of
actuarial computations and does not relate to the actual investment performance
of the underlying Fund. Therefore, the Assumed Investment Return must be
"neutralized" in computing the Annuity change factor. For weekly Valuation
Periods and a 4.25% Assumed Investment Return, the neutralization factor is
0.9991999.

WITHHOLDING ON ANNUITY PAYMENTS AND OTHER DISTRIBUTIONS

Security First Life is required to withhold federal income tax on Contract
distributions (such as Annuity Payments, lump sum distributions or partial
surrenders). However, recipients of Contract distributions are allowed to make
an election not to have federal income tax withheld. After such election is made
with respect to Annuity Payments, an Annuitant may revoke the election at any
time, and thereafter commence withholding. In such a case, Security First Life
will notify the payee at least annually of his or her right to change such
election.

The withholding rate followed by Security First Life will be applied only
against the taxable portion of Contract distributions. Federal tax will be
withheld from Annuity Payments pursuant to the recipient's withholding
certificate. If no withholding certificate is filed with Security First Life,
federal tax will be withheld from Annuity Payments on the basis that the payee
is married with three withholding exemptions. Federal tax on the taxable portion
of a partial or total surrender (i.e., non-periodic distribution) generally will
be withheld at a flat 10% rate. In the case of a plan qualified under Sections
401(a) or 403(a) of the Code, if the balance to the credit of a participant in a
plan is distributed within one taxable year to the recipient ("total
distribution"), the amount of withholding will approximate the federal income
tax on a lump sum distribution. If a total distribution is made from such a plan
or a tax-sheltered annuity on account of the participant's death, the amount of
withholding will reflect the exclusion from federal income tax for
employer-provided death benefits.

   
Security First Life is required to withhold 20% of certain taxable amounts
constituting "eligible rollover distributions" to participants (including lump
sum distributions) in retirement plans under Code Section 401 and tax deferred
annuities under Code Section 403(b). This withholding requirement does not apply
to distributions from such plans and annuities in the form of a life and life
expectancy annuity (individual or joint), an annuity with a designated period of
10 years or more, or any distribution required by the minimum distribution
requirements of Code Section 401(a)(9). Withholding on these latter types of
distribution will continue to be made under the rules described in the prior
paragraph. A participant cannot elect out of the 20% withholding requirement.
However, if an eligible rollover distribution is rolled over into an eligible
retirement plan or IRA in the case of a 401 plan or to another eligible contract
in the case of a 403(b) plan in a direct trustee-to-trustee transfer, no
withholding will be required.
    

Payees are required by law to provide Security First Life (as payor) with their
correct taxpayer identification number ("TIN"). If the payee is an individual,
the TIN is the same as his or her social security number. If the payee elects
not to have federal income tax withheld on an Annuity Payment or a nonperiodic
distribution and a correct TIN has not been provided, such election is
ineffective, and such payment will be subject to withholding as noted above.


                                       9
<PAGE>   99
UNDERWRITERS, DISTRIBUTION OF THE CONTRACTS

   
The Contracts will be sold as a continuous offering by individuals who are
appropriately licensed as insurance agents of Security First Life for the sale
of life insurance and Variable Annuity Contracts in the state where the sale is
made. In addition, these individuals will be registered representatives of the
principal underwriter, Security First Financial, Inc., or of other
broker-dealers registered under the Securities Exchange Act of 1934 whose
registered representatives are authorized by applicable law to sell Variable
Annuity Contracts issued by Security First Life. Commissions on sales of
contracts range from 0% to 8.5%. Agents are paid from the General Account of
Security First Life. Such commissions bear no direct relationship to any of the
charges under the Contracts. It is expected that the Contracts will be sold in
49 states and the District of Columbia. No direct underwriting commissions are
paid to Security First Financial, Inc.
    

CALCULATION OF PERFORMANCE DATA

   
a. Money Market Portfolio. The yield of the Money Market Portfolio of the
Separate Account for the seven day period ended December 31, 1994 was 3.95%.
This yield was computed by determining the net change, exclusive of capital
changes, in the value of a hypothetical pre-existing account having a balance of
one accumulation unit of the Series at the beginning of the period, subtracting
a hypothetical charge reflecting deductions from account values, and dividing
the difference by the value of the account at the beginning of the base period
to obtain the base period return, and multiplying the base period return by
(365/7) with the resulting yield figure carried to a least the nearest hundredth
of one percent.

The effective yield of the Money Market Portfolio of the Separate Account for
the seven day period ended December 31, 1994 was 4.03%. This effective yield was
computed by determining the net change, exclusive of capital changes, in the
value of a hypothetical pre-existing account having a balance of one
accumulation unit of the Series at the beginning of the period, subtracting a
hypothetical charge reflecting deductions from account values, and dividing the
difference by the value of the account at the beginning of the base period to
obtain the base period return, and then compounding the base period return by
adding 1, raising the sum to a power equal to 365 divided by 7, and subtracting
1 from the result, according to the following formula:
    

      EFFECTIVE YIELD = (BASE PERIOD RETURN + 1)365/7 - 1.

   
b. Other Funds. The average annual total return of the other Funds in the
Separate Account as of December 31, 1995 are as follows:*

<TABLE>
<CAPTION>
                                           Average Annual Total Returns
                                           ----------------------------
                                                                                      Inception
                                              1 Year             5 Years               to Date
                                              ------             -------               -------
<S>                                           <C>                <C>                  <C>
      Growth Portfolio                        33.70%                                    14.48%
      Overseas Portfolio                       8.33%                                    7.79%
      Contrafund Portfolio                                                              37.37%
      Small Capitalization Portfolio                                                    44.76%
</TABLE>
    

- --------
* The Series investing in the Value Equity Series and U.S. Government Income
Series had not commenced operations as of the date of this statement.

                                       10
<PAGE>   100
Average annual total return was computed by finding the average annual
compounded rates of return over the 1, 5, and 10 year periods that would equate
the initial amount invested to the ending redeemable value, according to the
following formula:

                                  P(1+T)n = ERV

Where:

     P = a hypothetical initial payment of $1,000 
     T = average annual total return 
     n = number of years
     ERV = ending redeemable value of a hypothetical $1,000 payment made at the 
           beginning of the 1, 5, or 10 year periods (or fractional portion 
           thereof).

The computation of average annual total returns does take into consideration
recurring charges and any non-recurring charges applicable to a Contract which
is surrendered in full at the end of the stated holding period.

VOTING RIGHTS

Unless otherwise restricted by the plan under which a Contract is issued each
Owner will have the right to instruct Security First Life with respect to voting
the Fund Shares which are the assets underlying the Owner's interest in the
Separate Account, at all regular and special shareholders meetings. An
Annuitant's voting power with respect to Fund shares held by the Separate
Account declines during the time the Annuitant is receiving a Variable Annuity
based on the investment performance of the Separate Account, because amounts
attributable to the Annuitant's interest are being transferred annually to the
General Account to provide the variable payments.

SAFEKEEPING OF SECURITIES

Custody of all assets of the Separate Account are held by Security First Life.
The assets of each Separate Account Series will be kept physically segregated by
Security First Life and held separate from the assets of any other firm, person,
or corporation. Additional protection for the assets of the Separate Account is
afforded by fidelity bonds covering all of Security First Life's officers and
employees.

SERVICING AGENT

An administrative services agreement has been entered into between Security
First Life and SFG under which the latter has agreed to perform certain of the
administrative services relating to the Contracts and for the Separate Account.
SFG performs substantially all of the recordkeeping and administrative services
for the Separate Account. Security First Life has not paid fees to SFG for these
services.

INDEPENDENT AUDITORS

The financial statements of Security First Life and its Separate Account
included in this Statement of Additional Information and Registration Statement
have been audited by Ernst & Young LLP, independent auditors, for the periods
indicated in their reports thereon which appear elsewhere herein and in the
Registration Statement. The financial statements audited by Ernst & Young LLP
have been included in reliance on their reports, given on their authority as
experts in accounting and auditing.

                                       11
<PAGE>   101
LEGAL MATTERS

   
Legal matters concerning federal securities laws applicable to the issue and
sale of the variable annuity contracts have been passed upon by Routier and
Johnson, P.C., 1700 K Street, N.W., Washington, D.C. 20006.
    

STATE REGULATION OF SECURITY FIRST LIFE

   
Security First Life is subject to the laws of the state of Delaware governing
insurance companies and to regulation by the Delaware Commissioner of Insurance.
An annual statement, in a prescribed form, is filed with the Commissioner on or
before March 1 each year covering the operations of Security First Life for the
preceding year and its financial condition on December 31 of such year. Security
First Life's books and assets are subject to review or examination by the
Commissioner or his agents at all times, and a full examination of its
operations is usually conducted by the National Association of Insurance
Commissioners at least once in every three years. Security First Life was last
examined as of December 31, 1993. While Delaware insurance law prescribes
permissible investments for Security First Life, it does not prescribe
permissible investments for the Separate Account, nor does it involve
supervision of the investment management or policy of Security First Life.
    

In addition, Security First Life is subject to the insurance laws and
regulations of other jurisdictions in which it is licensed to operate. State
insurance laws generally provide regulations for the licensing of insurers and
their agents, govern the financial affairs of insurers, require approval of
policy forms, impose reserve requirements and require filing of an annual
statement. Generally, the insurance departments of these other jurisdictions
apply the laws of Delaware in determining permissible investments for Security
First Life.

FINANCIAL STATEMENTS

The financial statements of Security First Life contained herein should be
considered only for the purposes the of informing investors as to its ability to
carry out the contractual obligations as depositor under the Annuity contracts
and as custodian as described elsewhere herein and in the prospectus. The
financial statements of the Separate Account are also included in this Statement
of Additional Information.


                                       12
<PAGE>   102
   


                                  [LETTERHEAD]


                         Report of Independent Auditors




To the Board of Directors
Security First  Life Insurance Company
         and Contract Owners
Security First Life Separate Account A

We have audited the accompanying statements of assets and liabilities, including
the schedules of investments, of Security First Life Separate Account A
(comprised of Series B, G, T, P, I, FA, FG, FI, FO, FM, SU, SV, and commencing
on May 16, 1995, Series FC, commencing on May 22, 1995, Series AS and SI, and
commencing on May 25, 1995, Series FE) as of December 31, 1995, and the related
statements of operations for the year or period then ended and changes in net
assets for each of the two years or periods then ended. These financial
statements are the responsibility of the Separate Account's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1995, by correspondence with
the respective mutual fund managers. 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 Security First Life Separate
Account A (comprised of the above referenced Series) at December 31, 1995, the
results of their operations for the year or period then ended, and the changes
in their net assets for each of the two years or periods then ended, in
conformity with generally accepted accounting principles.


                                        /s/ Ernst & Young
                                       ------------------
                                       Ernst & Young




Los Angeles, California
April 5, 1996
    




                                       1
<PAGE>   103

   
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                               Series B     Series G      Series T      Series P     Series I
                                                               --------     --------      --------      --------     --------
<S>                                                           <C>          <C>           <C>           <C>          <C>       
ASSETS

Investments

   Security First Trust - Bond Series (1,656,211 shares at 
     net asset value of $3.94 per share; cost $6,524,502)     $6,530,291

   Security First Trust - Growth and Income Series 
     (6,132,716 shares at net asset value of $11.52 per
     share; cost $58,200,522)                                              $70,635,406

   T. Rowe Price Growth Stock Fund, Inc. (1,865,082 shares
     at net asset value of $23.35 per share; cost
     $38,474,288)                                                                        $43,549,662

   T. Rowe Price Prime Reserve Fund, Inc. (2,625,979 
     shares at net asset value of $1.00 per share; cost
     $2,625,979)                                                                                       $2,625,979

   T. Rowe Price International Fund, Inc. (681,384 shares at 
     net asset value of $12.23 per share; cost $8,160,138)                                                          $8,333,329

Receivable from Security First Life Insurance Company for
   purchases                                                       7,703        60,695        31,863          535       35,702

Other assets                                                      14,473         8,944                          9          865
                                                              ----------   -----------   -----------   ----------   ----------

                  TOTAL ASSETS                                $6,552,467   $70,705,045   $43,581,525   $2,626,523   $8,369,896
</TABLE>




                                       1
<PAGE>   104
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES (continued)




<TABLE>
<CAPTION>
                                                           Series B     Series G      Series T      Series P     Series I
                                                           --------     --------      --------      --------     --------
<S>                                                       <C>          <C>           <C>           <C>          <C>       
LIABILITIES

   Payable to Security First Life Insurance Company for
     mortality and expense risk                           $    5,314   $    56,529   $    30,437   $    2,036   $    7,834

   Payable to Security First Life Insurance Company for
     redemptions                                                 659         3,862         1,150           51       27,985

   Payable to Mutual Funds                                    22,109        65,348

   Other liabilities                                                                      16,637        1,151           15
                                                          ----------   -----------   -----------   ----------   ----------

                  TOTAL LIABILITIES                           28,082       125,739        48,224        3,238       35,834


NET ASSETS
   Cost to Investors:
     Series B Accumulation Units                           6,518,596
     Series G Accumulation Units                                        58,144,422
     Series T Accumulation Units                                                      38,457,927
     Series P Accumulation Units                                                                    2,623,285
     Series I Accumulation Units                                                                                 8,160,870

   Accumulated Undistributed Gain:
     Net unrealized appreciation                               5,789    12,434,884     5,075,374                   173,191
                                                          ----------   -----------   -----------   ----------   ----------

       NET ASSETS APPLICABLE TO OUTSTANDING
       UNITS OF CAPITAL                                   $6,524,385   $70,579,306   $43,533,301   $2,623,285   $8,334,061
                                                          ==========   ===========   ===========   ==========   ==========
</TABLE>





The accompanying notes are an integral part of these financial statements.


                                       2
<PAGE>   105
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 1995


<TABLE>
<CAPTION>
                                                            Series B    Series G      Series T    Series P   Series I
                                                            --------    --------      --------    --------   --------
<S>                                                         <C>         <C>           <C>         <C>        <C>       
INVESTMENT INCOME:                                         
                                                           
     Dividends                                              $371,424   $ 2,047,981   $2,127,559   $143,086   $251,104
                                                           
     Other income                                              1,744        22,216        2,422        800      4,629
                                                            --------   -----------   ----------   --------   --------
                                                           
                                                             373,168     2,070,197    2,129,981    143,886    255,733
                                                           
EXPENSES:                                                  
                                                           
     Charges for mortality and expense risk                   56,396       555,472      322,986     23,948     61,500
                                                            --------   -----------   ----------   --------   --------
                                                           
       Net Investment Income                                 316,772     1,514,725    1,806,995    119,938    194,233
                                                           
                                                           
REALIZED AND UNREALIZED INVESTMENT GAINS                   
     (LOSSES)                                              
                                                           
   Realized investment gains (losses)                        (36,046)    1,021,117      764,380                17,327
                                                           
   Unrealized appreciation of investments                    560,723    12,817,755    6,849,189               506,270
                                                            --------   -----------   ----------   --------   --------
                                                           
       Net investment gains                                  524,677    13,838,872    7,613,569               523,597
                                                            --------   -----------   ----------   --------   --------
                                                           
         Increase in net assets resulting from operations   $841,449   $15,353,597   $9,420,564   $119,938   $717,830
                                                            ========   ===========   ==========   ========   ========
</TABLE>





The accompanying notes are an integral part of these financial statements.


                                       3
<PAGE>   106
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                             Series B      Series G      Series T      Series P      Series I
                                                             --------      --------      --------      --------      --------
<S>                                                         <C>           <C>           <C>           <C>           <C>       
Operations:

   Net investment income                                    $  316,772    $ 1,514,725   $ 1,806,995   $  119,938    $  194,233

   Net realized investment gains (losses)                      (36,046)     1,021,117       764,380                     17,327 
                                                                                                                             
   Net unrealized investment appreciation during the year      560,723     12,817,755     6,849,189                    506,270
                                                            ----------    -----------   -----------   ----------    ----------

     Increase in net assets resulting from operations          841,449     15,353,597     9,420,564      119,938       717,830

Increase (decrease) in net assets resulting from capital

     unit transactions                                         577,456      6,487,662     4,713,786      (98,627)    2,662,352
                                                            ----------    -----------   -----------   ----------    ----------

         Total Increase                                      1,418,905     21,841,259    14,134,350       21,311     3,380,182

Net Assets at December 31, 1994                              5,105,480     48,738,047    29,398,951    2,601,974     4,953,879
                                                            ----------    -----------   -----------   ----------    ----------

Net Assets at December 31, 1995                             $6,524,385    $70,579,306   $43,533,301   $2,623,285    $8,334,061
                                                            ==========    ===========   ===========   ==========    ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       4
<PAGE>   107
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1994

<TABLE>
<CAPTION>
                                                      Series B      Series G      Series T     Series P      Series M     Series I
                                                      --------      --------      --------     --------      --------     --------
<S>                                                  <C>          <C>           <C>           <C>          <C>           <C>       
Operations:

   Net investment income                             $  238,821   $ 1,215,163   $ 2,367,834   $   74,197   $     1,285   $  278,259

   Net realized investment gains                         19,242     2,736,099     1,786,634                                 147,429

   Net unrealized investment depreciation during  
     the year                                          (508,208)   (3,086,482)   (4,153,007)                               (555,178)
                                                     ----------   -----------   -----------   ----------   -----------   ----------

     Increase (decrease) in net assets resulting   
         from operations                               (250,145)      864,780         1,461       74,197         1,285     (129,490)

Increase in net assets resulting from capital unit  
     transactions                                      (279,127)    4,586,417     4,781,841     (564,963)   (2,478,148)   3,540,284
                                                     ----------   -----------   -----------   ----------   -----------   ----------

         Total Increase (Decrease)                     (529,272)    5,451,197     4,783,302     (490,766)   (2,476,863)   3,410,794

Net Assets at December 31, 1993                       5,634,752    43,286,850    24,615,649    3,092,740     2,476,863    1,543,085
                                                     ----------   -----------   -----------   ----------   -----------   ----------

Net Assets at December 31, 1994                      $5,105,480   $48,738,047   $29,398,951   $2,601,974   $         0   $4,953,879
                                                     ==========   ===========   ===========   ==========   ===========   ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       5
<PAGE>   108
SECURITY FIRST LIFE SEPARATE ACCOUNT A

INVESTMENTS

DECEMBER 31, 1995



                                                                      SCHEDULE I

<TABLE>
<CAPTION>
                                                           Carrying     Unrealized
              Name of Issue                   Shares        Value      Appreciation     Cost
              -------------                   ------        -----      ------------     ----
<S>                                          <C>         <C>           <C>           <C>        
Security First Trust Bond Series - capital
  shares                                     1,656,211   $ 6,530,291   $     5,789   $ 6,524,502

Security First Trust Growth and Income
  Series - capital shares                    6,132,716   $70,635,406   $12,434,884   $58,200,522

T. Rowe Price Growth Stock Fund, Inc. -
  capital shares                             1,865,082   $43,549,662   $ 5,075,374   $38,474,288

T. Rowe Price Prime Reserve Fund, Inc. -
  capital shares                             2,625,979   $ 2,625,979                 $ 2,625,979

T. Rowe Price International Stock Fund,
  Inc. - capital shares                        681,384   $ 8,333,329   $   173,191   $ 8,160,138
</TABLE>



Note A    The carrying value of the investments is the reported net asset value
          of investment companies capital shares.

Note B    Cost is determined by using the first-in, first-out cost method.




The accompanying notes are an integral part of these financial statements.


                                       6
<PAGE>   109
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                             Series FA     Series FG    Series FI    Series FO    Series FM
                                                             ---------     ---------    ---------    ---------    ---------
<S>                                                         <C>           <C>           <C>          <C>          <C>       
ASSETS

Investments

   Fidelity Investments - VIP Asset Manager (2,782,258
     shares at net asset value of $15.79 per share; cost
     $39,902,742)                                           $43,931,846

   Fidelity Investments - VIP Growth Portfolio (1,518,582
     shares at net asset value of $29.20; cost
     $37,606,829)                                                         $44,342,589

   Fidelity Investments - VIP Index 500 (86,186 shares at
     net asset value of $75.71; cost $5,776,430)                                        $6,525,133

   Fidelity Investments - VIP Overseas Portfolio (284,670
     shares at net asset value of $17.05; cost
     $ 4,603,656)                                                                                    $4,853,623

   Fidelity Investments - VIP Money Market Series
     (8,395,157 shares at net asset value of $1.00 per
     share; cost $8,395,157)                                                                                      $8,395,157

Receivable from Security First Life Insurance Company
     for purchases                                               75,517       213,505       64,542       62,379       56,584

Other assets                                                      3,180         4,999       10,357                        59
                                                            -----------   -----------   ----------   ----------   ----------
                  TOTAL ASSETS                              $44,010,543   $44,561,093   $6,600,032   $4,916,002   $8,451,800
</TABLE>



                                       7
<PAGE>   110
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES (continued)

DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                           Series FA     Series FG    Series FI    Series FO    Series FM
                                                           ---------     ---------    ---------    ---------    ---------
<S>                                                       <C>           <C>           <C>          <C>          <C>       
LIABILITIES

   Payable to Security First Life Insurance Company for
     mortality and expense risk                           $    44,158   $    42,932   $    5,949   $    4,550   $    7,351

   Payable to Security First Life Insurance Company for
     redemptions                                               14,433        19,499       11,207          750          492

   Payable to Mutual Funds                                     71,222       198,340       61,878       62,436       54,732

   Other liabilities                                                            680                                  1,852
                                                          -----------   -----------   ----------   ----------   ----------

                  TOTAL LIABILITIES                           129,813       261,451       79,034       67,736       64,427


NET ASSETS

   Cost to Investors:
     Series FA Accumulation Units                          39,851,626
     Series FG Accumulation Units                                        37,563,882
     Series FI Accumulation Units                                                      5,772,295
     Series FO Accumulation Units                                                                   4,598,299
     Series FM Accumulation Units                                                                                8,387,373

   Accumulated Undistributed Income:
     Net unrealized appreciation                            4,029,104     6,735,760      748,703      249,967
                                                          -----------   -----------   ----------   ----------   ----------

     NET ASSETS APPLICABLE TO OUTSTANDING
     UNITS OF CAPITAL                                     $43,880,730   $44,299,642   $6,520,998   $4,848,266   $8,387,373
                                                          ===========   ===========   ==========   ==========   ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       8
<PAGE>   111
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                         Series FA     Series FG    Series FI   Series FO   Series FM
                                                         ---------     ---------    ---------   ---------   ---------
<S>                                                     <C>           <C>           <C>         <C>         <C>     
INVESTMENT INCOME:

   Dividends                                            $  562,504    $   81,618    $ 20,704    $ 15,919    $339,310

EXPENSES:

   Charges for mortality and expense risk                  414,098       320,517      31,873      36,283      62,783

   Other expense (income)                                  (10,299)     (101,082)    (16,698)      2,443      39,243
                                                        ----------    ----------    --------    --------    --------

                                                           403,799       219,435      15,175      38,726     102,026
                                                        ----------    ----------    --------    --------    --------

     Net Investment Income (Loss)                          158,705      (137,817)      5,529     (22,807)    237,284

REALIZED AND UNREALIZED INVESTMENT GAINS:

   Realized investment gains                                64,929        93,864      36,253       6,514

   Unrealized investment appreciation during the year    5,020,534     6,383,879     741,445     294,152
                                                        ----------    ----------    --------    --------  

         Net investment gains                            5,085,463     6,477,743     777,698     300,666
                                                        ----------    ----------    --------    --------    --------

           Increase in net assets resulting from
               operations                               $5,244,168    $6,339,926    $783,227    $277,859    $237,284
                                                        ==========    ==========    ========    ========    ========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       9
<PAGE>   112
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                         Series FA     Series FG     Series FI     Series FO    Series FM
                                                         ---------     ---------     ---------     ---------    ---------
<S>                                                     <C>           <C>            <C>          <C>           <C>       
Operations:

   Net investment income (loss)                         $   158,705   $  (137,817)   $    5,529   $  (22,807)   $  237,284

   Net realized investment gain                              64,929        93,864        36,253        6,514

   Net unrealized investment appreciation
     during the year                                      5,020,534     6,383,879       741,445      294,152
                                                        -----------   -----------    ----------   ----------    ----------

     Increase in net assets resulting from operations     5,244,168     6,339,926       783,227      277,859       237,284

Increase in net assets resulting from capital unit
     transactions                                        13,466,719    24,403,159     4,791,886    2,585,161     4,276,144
                                                        -----------   -----------    ----------   ----------    ----------

              Total Increase                             18,710,887    30,743,085     5,575,113    2,863,020     4,513,428

Net Assets at December 31, 1994                          25,169,843    13,556,557       945,885    1,985,246     3,873,945
                                                        -----------   -----------    ----------   ----------    ----------

Net Assets at December 31, 1995                         $43,880,730   $44,299,642    $6,520,998   $4,848,266    $8,387,373
                                                        ===========   ===========    ==========   ==========    ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.



                                       10
<PAGE>   113
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1994

<TABLE>
<CAPTION>
                                                            Series FA      Series FG     Series FI    Series FO    Series FM
                                                            ---------      ---------     ---------    ---------    ---------
<S>                                                        <C>            <C>            <C>         <C>           <C>       
Operations:

   Net investment income (loss)                            $    87,421    $    31,856    $ (5,934)   $  (10,535)   $  106,832

   Net realized investment gains (losses)                       (5,869)       (40,668)       (412)        1,749

   Net unrealized investment appreciation (depreciation)
     during the year                                        (1,215,262)       324,465       9,612       (47,106)
                                                           -----------    -----------    --------    ----------    ----------

     Increase (decrease) in net assets resulting from
     operations                                             (1,133,710)       315,653       3,266       (55,892)      106,832

Increase in net assets resulting from capital unit
     transactions                                           21,658,209     11,739,399     773,367     1,931,599     3,736,108
                                                           -----------    -----------    --------    ----------    ----------

              Total Increase                                20,524,499     12,055,052     776,633     1,875,707     3,842,940

Net Assets at December 31, 1993                              4,645,344      1,501,505     169,252       109,539        31,005
                                                           -----------    -----------    --------    ----------    ----------

Net Assets at December 31, 1994                            $25,169,843    $13,556,557    $945,885    $1,985,246    $3,873,945
                                                           ===========    ===========    ========    ==========    ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       11
<PAGE>   114
SECURITY FIRST LIFE SEPARATE ACCOUNT A

INVESTMENTS

DECEMBER 31, 1995



                                                                      SCHEDULE I

<TABLE>
<CAPTION>
                                                            Carrying
                                                             Value       Unrealized      Cost
                Name of Issue                   Shares      (Note A)    Appreciation   (Note B)
                -------------                   ------      --------    ------------   --------
<S>                                            <C>         <C>          <C>           <C>        
Fidelity Investments VIP Asset Manager -
     capital shares                            2,782,258   $43,931,846   $4,029,104   $39,902,742

Fidelity Investments VIP Growth Portfolio -
     capital shares                            1,518,582   $44,342,589   $6,735,760   $37,606,829

Fidelity Investments VIP Index 500 - capital
     shares                                       86,186   $ 6,525,133   $  748,703   $ 5,776,430

Fidelity Investments Overseas Portfolio -
     capital shares                              284,670   $ 4,853,623   $  249,967   $ 4,603,656

Fidelity Investments VIP Money Market Fund 
     - capital shares                          8,395,157   $ 8,395,157                $ 8,395,157
</TABLE>




Note A    The carrying value of the investments is the reported net asset value
          of the investment companies capital shares.

Note B    Cost is determined by using the first-in, first-out cost method.



                                       12
<PAGE>   115
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 1995


<TABLE>
<CAPTION>
                                                      Series SU     Series SV    Series AS    Series SI  Series FC    Series FE
                                                      ---------     ---------    ---------    ---------  ---------    ---------
<S>                                                   <C>          <C>           <C>          <C>        <C>          <C>     
ASSETS

Investments

   Security First Trust - U.S. Government Income
     Series (1,788,475 shares at net asset value
     of $5.18 per share; cost $9,015,628)             $9,263,160

   Security First Trust - Value Equity Series
     (2,216,873 shares at net asset value of
     $5.91 per share; cost $11,968,596)                            $13,100,908

   Alger American Small Capitalization Portfolio
     (122,440 shares at net asset value of $39.41
     per share; cost $4,918,114)                                                 $4,825,362

   Scudder International Fund (32,389 shares at
     net asset value of $11.82 per share; cost
     $372,264)                                                                                $382,835

   Fidelity Investments - VIP Contra Fund
     (426,703 shares at net asset value of $13.78
     per share; cost $5,787,530)                                                                         $5,879,966

   Fidelity Investments - VIP Equity Income
     Portfolio (41,802 shares at net asset value of
     $19.27 per share; cost $759,759)                                                                                 $805,524

Receivable from Security First Life Insurance
     Company for purchases                                47,996       144,892       34,274        331       60,377     17,300

Other assets                                                 170         1,009                      15        8,845
                                                      ----------   -----------   ----------   --------   ----------   --------

                  TOTAL ASSETS                        $9,311,326   $13,246,809   $4,859,636   $383,181   $5,949,188   $822,824
</TABLE>



                                       13
<PAGE>   116
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF ASSETS AND LIABILITIES (continued)



<TABLE>
<CAPTION>
                                                          Series SU     Series SV     Series AS    Series SI  Series FC    Series FE
                                                          ---------     ---------     ---------    ---------  ---------    ---------
<S>                                                       <C>          <C>           <C>           <C>        <C>          <C>     
LIABILITIES

   Payable to Security First Life Insurance Company for
     mortality and expense risk                           $    8,574   $    12,101   $    4,639    $    402   $    5,644   $    752

   Payable to Security First Life Insurance Company for
     redemptions                                               4,378         5,431          552                      653

   Payable to Mutual Funds                                    46,895       143,791       34,286         331       68,064     17,300

   Other liabilities                                                                     13,670                                 252
                                                          ----------   -----------   ----------    --------   ----------   --------

                  TOTAL LIABILITIES                           59,847       161,323       53,147         733       74,361     18,304


NET ASSETS - NOTES 4 AND 5

   Cost to Investors:
     Series SU Accumulation Units                          9,003,947
     Series SV Accumulation Units                                       11,953,174
     Series AS Accumulation Units                                                     4,899,241
     Series SI Accumulation Units                                                                   371,877
     Series FC Accumulation Units                                                                              5,782,391
     Series FE Accumulation Units                                                                                           758,755

   Accumulated Undistributed Income (loss):
     Net unrealized appreciation (depreciation)              247,532     1,132,312      (92,752)     10,571       92,436     45,765
                                                          ----------   -----------   ----------    --------   ----------   --------

   NET ASSETS APPLICABLE TO OUTSTANDING
   UNITS OF CAPITAL                                       $9,251,479   $13,085,486   $4,806,489    $382,448   $5,874,827   $804,520
                                                          ==========   ===========   ==========    ========   ==========   ========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       14
<PAGE>   117
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                      Series SU  Series SV   Series AS(1)  Series SI(1)  Series FC(1)  Series FE(1)
                                                      ---------  ---------   ------------  ------------  ------------  ------------
<S>                                                   <C>        <C>         <C>           <C>           <C>           <C>    
INVESTMENT INCOME:                                                                                                       
                                                                                                                         
   Dividends                                          $349,446   $  444,126                                $ 70,263      $ 5,416
                                                                                                                         
   Other income                                          2,208        4,077    $ 19,725      $   349         30,772          490
                                                      --------   ----------    --------      -------       --------      -------
                                                       351,654      448,203      19,725          349        101,035        5,906
                                                                                                                         
                                                                                                                         
EXPENSES:                                                                                                                
                                                                                                                         
   Charges for mortality and expense risk               70,358       88,613      14,826        1,349         18,477        2,303
                                                      --------   ----------    --------      -------       --------      -------
                                                                                                                         
     Net investment income (loss)                      281,296      359,590       4,899       (1,000)        82,558        3,603
                                                                                                                         
                                                                                                                         
REALIZED AND UNREALIZED INVESTMENT GAINS                                                                                 
   (LOSSES)                                                                                                              
                                                                                                                         
   Net realized investment gains (losses)              (29,574)      13,023      26,373          304         26,862          452
                                                                                                                         
   Unrealized investment appreciation (depreciation)   436,539    1,352,775     (92,752)      10,571         92,436       45,765
                                                      --------   ----------    --------      -------       --------      -------
                                                                                                                         
     Net investment gains (losses)                     406,965    1,365,798     (66,379)      10,875        119,298       46,217
                                                      --------   ----------    --------      -------       --------      -------
                                                                                                                         
        Increase (decrease) in net assets                                                                                
           resulting from operations                  $688,261   $1,725,388    $(61,480)     $ 9,875       $201,856      $49,820
                                                      ========   ==========    ========      =======       ========      =======
</TABLE>

(1) Series FC commenced operations May 16, 1995; Series AS and SI on May 22,
    1995; and Series FE on May 25, 1995.

The accompanying notes are an integral part of these financial statements.


                                       15
<PAGE>   118
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1995

<TABLE>
<CAPTION>
                                                 Series SU     Series SV   Series AS(1)  Series SI(1)  Series FC(1)  Series FE(1)
                                                 ---------     ---------   ------------  ------------  ------------  ------------
<S>                                             <C>           <C>          <C>           <C>           <C>           <C>     
OPERATIONS:                                                                                                            
                                                                                                                       
   Net investment income (loss)                 $  281,296    $   359,590   $    4,899    $ (1,000)     $   82,558     $  3,603
                                                                                                                       
   Net realized investment gains (losses)          (29,574)        13,023       26,373         304          26,862          452
                                                                                                                       
   Unrealized investment appreciation                                                                                  
     (depreciation) during the year                436,539      1,352,775      (92,752)     10,571          92,436       45,765
                                                ----------    -----------   ----------    --------      ----------     --------
Increase (decrease) in net assets resulting                                                                            
     from operations                               688,261      1,725,388      (61,480)      9,875         201,856       49,820
                                                                                                                       
Increase in net assets resulting from capital                                                                          
     unit transactions                           4,043,705      6,807,136    4,867,969     372,573       5,672,971      754,700
                                                ----------    -----------   ----------    --------      ----------     --------
                   Total Increase                4,731,966      8,532,524    4,806,489     382,448       5,874,827      804,520
                                                                                                                       
Net assets at December 31, 1994                  4,519,513      4,552,962                                              
                                                ----------    -----------   ----------    --------      ----------     --------
Net assets at December 31, 1995                 $9,251,479    $13,085,486   $4,806,489    $382,448      $5,874,827     $804,520
                                                ==========    ===========   ==========    ========      ==========     ========
</TABLE>

(1) Series FC commenced operations May 16, 1995; Series AS and SI on May 22,
    1995; and Series FE on May 25, 1995.




The accompanying notes are an integral part of these financial statements.


                                       16
<PAGE>   119
SECURITY FIRST LIFE SEPARATE ACCOUNT A

STATEMENT OF CHANGES IN NET ASSETS

YEAR ENDED DECEMBER 31, 1994

<TABLE>
<CAPTION>
                                                         Series SU     Series SV
                                                         ---------     ---------
<S>                                                     <C>           <C>       
OPERATIONS:

   Net investment income                                $  100,307    $   15,569

   Net realized investment losses                          (31,739)      (16,538)

   Unrealized investment depreciation during the year     (157,317)     (226,588)
                                                        ----------    ----------

Decrease in net assets resulting from operations           (88,749)     (227,557)

Increase in net assets resulting from capital unit
     transactions                                        3,081,435     3,471,901
                                                        ----------    ----------

                   Total Increase                        2,992,686     3,244,344

Net assets at December 31, 1993                          1,526,827     1,308,618
                                                        ----------    ----------

Net assets at December 31, 1994                         $4,519,513    $4,552,962
                                                        ==========    ==========
</TABLE>




The accompanying notes are an integral part of these financial statements.


                                       17
<PAGE>   120
SECURITY FIRST LIFE SEPARATE ACCOUNT A

INVESTMENTS

DECEMBER 31, 1995

                                                                      SCHEDULE I

<TABLE>
<CAPTION>
                                                              Carrying      Unrealized
                                                              Value        Appreciation       Cost
                Name of Issue                     Shares      (Note A)    (Depreciation)    (Note B)
                -------------                     ------      --------    --------------    --------
<S>                                              <C>         <C>          <C>             <C>        
Security First Trust U. S. Government Series -                                            
   capital shares                                1,788,475   $ 9,263,160   $  247,532      $ 9,015,628
                                                                                          
Security First Trust Value Equity Series -                                                
   capital shares                                2,216,873   $13,100,908   $1,132,312      $11,968,596
                                                                                          
Alger American Small Capitalization Portfolio                                             
   - capital shares                                122,440   $ 4,825,362   $  (92,752)     $ 4,918,114
                                                                                          
Scudder International Portfolio - capital                                                 
   shares                                           32,389   $   382,835   $   10,571      $   372,264
                                                                                          
Fidelity Investments VIP Contra Fund - capital                                            
   shares                                          426,703   $ 5,879,966   $   92,436      $ 5,787,530
                                                                                          
Fidelity Investments VIP Equity Income                                                    
   Portfolio - capital shares                       41,802   $   805,524   $   45,765      $   759,759
</TABLE>

Note A    The carrying value of the investments is the reported net asset value
          of investment companies capital shares.

Note B    Cost is determined by using the first-in, first-out cost method.


The accompanying notes are an integral part of these financial statements.

                                       18
<PAGE>   121
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1995



NOTE 1 -- BASIS OF PRESENTATION

Security First Life Separate Account A (Separate Account) was established on May
29, 1980, as a separate account of Security First Life Insurance Company
(Security Life), the sponsor company, and is registered under the Investment
Company Act of 1940 as a unit investment trust. The Separate Account is designed
to provide annuity benefits pursuant to certain variable annuity contracts (the
Contracts) issued by Security Life.

In accordance with the terms of the Contracts, all payments allocated to the
Separate Account by the contract owners must be allocated to purchase shares of
any or all of four series of Security First Trust (the Trust), a Massachusetts
business trust, and twelve mutual funds (investment companies). The series of
the Trust are Bond Series, Growth and Income Series, Value Equity Series, and
U.S. Government Income Series and the mutual funds are T. Rowe Price Growth
Stock Fund, Inc., T. Rowe Price Prime Reserve Fund, Inc., T. Rowe Price
International Stock Fund, Inc., Alger American Small Capitalization Portfolio,
Scudder International Fund, and Fidelity Investments: VIP Asset Manager, VIP
Growth Portfolio, VIP Index 500, VIP Overseas Portfolio, VIP Contra Fund, VIP
Equity Income Portfolio and VIP Money Market Fund. The Trust and the (investment
companies) are registered as diversified, open-end management investment
companies under the Investment Company Act of 1940. The Separate Account is
correspondingly divided into sixteen series of Accumulation Units, Series B, G,
SU, SV, T, P, I, AS, SI, FA, FG, FI, FO, FC, FE and FM, relating to investments
in each of the investment companies, respectively. For the year ended December
31, 1994 and prior, assets held by certain Series (SF 135R2S contracts) were
reported separately in the financial statements. For the year ended December 31,
1995 these contracts were combined with the other contracts that shared the same
series.

All series of the Trust receive administrative services for a fee from Security
First Investment Management Corporation (Security Management). Security First
Financial, Inc. is the principal underwriter for the Contracts. Security Life,
Security Management, and Security First Financial, Inc. are wholly-owned
subsidiaries of Security First Group, Inc. Investment advice is provided to the
Security First Trust Bond Series and Growth and Income Series by T. Rowe Price
Associates, Inc. and to the Security First Trust Value Equity and U. S.
Government Income Series by Virtus Capital Management.




                                       19
<PAGE>   122
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)



NOTE 1 -- BASIS OF PRESENTATION (continued)

The Separate Account and each series therein are administered and accounted for
as part of the business of Security Life, but the investment income and capital
gains and losses of each Separate Account series are identified with the assets
held for that series in accordance with the terms of the Contracts, without
regard to investment income and capital gains and losses arising out of any
other business Security Life may conduct.

The Separate Account incurs no liability for remuneration to directors, advisory
boards, officers or such other persons who may from time to time perform
services for the Separate Account.


NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES

VALUATION OF INVESTMENTS -- Investments are carried at market value, which is
determined by multiplying the investment company's shares owned by the Separate
Account by the reported net asset value per share of each respective investment
company. Realized investment gains and losses are determined on the first-in,
first-out cost basis.

EXPENSES AND CHARGES -- The Separate Account accrues charges incurred for the
mortality and expense risk assumed by Security Life. The charges are calculated
daily by multiplying the value of the assets of the Separate Account by the
daily mortality and expense risk rate. Security Life has the option of calling
for payment of such charges at any time. The following table illustrates the
rates for the respective contracts:

<TABLE>
<CAPTION>
               Contract Type                      Annual Rate         Daily Rate
               -------------                      -----------         ----------
<S>                                               <C>                 <C>
     SF 234; SF 89; SF 224FL;
         SF 236FL; SF 1700 Contracts                  .89%             .0000244
     SF 135R; SF 135R2V; SF 226RI Contracts          1.25%             .0000342
     SF 135R2S Contracts                             1.15%             .0000315
</TABLE>

The following charges are deducted from a contract holder's account by Security
Life as a capital transaction by reducing the separate account units held, and
such charges are not an expense of the Separate Account. An administration
charge (contract charge) is deducted from each contract and paid to Security
Life at the end of each contract year prior to the annuity date, and when the
entire contract value is withdrawn on any date other than a contract
anniversary. In the event that a participant withdraws




                                       20
<PAGE>   123
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)



NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES (continued)

all or a portion of the participant's account, a contingent deferred sales
charge (CDSC) may be applied to the amount of the contract value withdrawn to
cover certain expense relating to the sale of contracts. The following table
illustrates contract charges and CDSC with respect to the various types of
contracts:

<TABLE>
<CAPTION>
                           Maximum Contract
     Contract Type         Charge Per Year                             CDSC
     -------------         ---------------                             ----
<S>                        <C>                   <C>                                                              
     SF 236FL                   $12.00           Based on elapsed time since premium received.   
                                                 Disappears on or before 6th anniversary.

     SF 224FL                   $40.00           Based on elapsed time since premium received.  
                                                 Disappears on or before 6th anniversary.

     SF 1700                    $42.50           Based on elapsed time since premium received.  
                                                 Disappears on or before 6th anniversary.

     Group Form
       226RI                    $41.50           Seven percent of premium received.  Disappears 
                                                 on or before 6th anniversary.

     All other group            $19.50           Five percent of premium received.  Disappears on 
                                                 or before 6th anniversary.

     SF 135R2V                     *             None
                                     
     SF 135R2S and other             
       individual                  *             Based on elapsed time since premium received.  
                                                 Disappears after 7th year.
</TABLE>

     * .15% annually of average account value (currently being waived).

In addition, transaction charges of $10 are incurred for each surrender or
annuitization. Upon conversion of either accumulation or annuity units from one
series to another, a $10 conversion charge is incurred. The amount deducted for
contract charges and CDSC was $273,809 for the year ended December 31, 1995, and
$132,959 for the year ended December 31, 1994.

INCOME RECOGNITION AND REINVESTMENT -- Income is recognized as declared payable
by the investment companies. All distributions received are reinvested in the
investment companies.




                                       21
<PAGE>   124
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)



NOTE 3 -- FEDERAL INCOME TAXES

The operations of the Separate Account form a part of, and are taxed with, the
operations of Security Life, which is taxed as a "life insurance company" under
the Internal Revenue Code, and as such, Security Life is liable for income
taxes, if any, which become payable with respect to the Separate Account's
operations.

Separate accounts are generally required to meet certain diversification
requirements for their assets. However, separate accounts which solely provide
benefits for "pension plan contracts" are exempt from the diversification
requirements. Pension plan contracts include: (i) tax qualified plans; (ii)
employee annuities; (iii) plans for employees of life insurance companies; (iv)
tax sheltered annuities of exempt organizations; (v) individual retirement
accounts or annuities, and (vi) deferred compensation plans of certain
governmental or tax-exempt organizations. The Contracts issued by Security Life
are offered in connection with both pension plan contracts and non-qualified
contracts, therefore the Separate Account is subject to the diversification
requirements. Management believes that the Separate Account has met the
diversification requirements.


NOTE 4 -- CAPITAL TRANSACTIONS

Additions and deductions to Units of Capital consisting of the effect of capital
unit transactions were as follows:

<TABLE>
<CAPTION>
                                                     Additions to Capital               Deductions From Capital
                                                      $               Units               $                 Units
                                                    -----             -----             -----               -----
<S>                                               <C>               <C>               <C>                  <C>    
   Year ended December 31, 1995:

   SF 135R; SF 226RI Contracts
   ---------------------------

   Series B Accumulation Units                       434,597           54,077           110,016             13,561
   Series G Accumulation Units                     4,305,620          420,939           881,557             89,611
   Series FA Accumulation Units                   14,071,749        2,554,939         4,044,605            724,251
   Series FG Accumulation Units                   14,711,150        2,249,747         1,345,976            204,887
   Series FI Accumulation Units                    3,146,381          487,693           135,735             21,838
   Series FO Accumulation Units                      505,089           87,729           336,120             58,663
   Series FM Accumulation Units                    4,916,221          921,317         1,605,571            302,600
   Series SU Accumulation Units                      105,370           19,715
   Series AS Accumulation Units                    4,947,271          746,279            79,302             11,979
   Series SI Accumulation Units                      376,043           66,110             3,470                605
   Series FC Accumulation Units                    5,777,070          950,446           104,099             16,764
</TABLE>


                                       22
<PAGE>   125
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)




<TABLE>
<CAPTION>
                                                     Additions to Capital               Deductions From Capital
                                                      $               Units               $                 Units
                                                    -----             -----             -----               -----
<S>                                               <C>               <C>               <C>                  <C>    
   Series FE Accumulation Units                      760,961          132,235             6,261              1,114
</TABLE>

NOTE 4 -- CAPITAL TRANSACTIONS (continued)

<TABLE>
<CAPTION>
                                                           Additions to Capital       Deductions From Capital
                                                             $            Units           $            Units
                                                           -----          -----         -----          -----
<S>                                                      <C>            <C>           <C>            <C>   
SF 234; SF 89; SF 224FL; SF 236FL; SF 1700 Contracts
- ----------------------------------------------------

Series B Accumulation Units                                 833,258        48,874        580,383        33,929
Series G Accumulation Units                               9,125,759       294,937      6,062,160       196,489
Series T Accumulation Units                               9,366,192       347,286      4,652,406       171,305
Series P Accumulation Units                                 634,124        50,176        732,751        57,732
Series I Accumulation Units                               4,605,139       660,163      1,942,787       276,598
Series FA Accumulation Units                              5,110,732       961,908      1,671,157       311,571
Series FG Accumulation Units                              6,918,341     1,058,309        692,639       106,251
Series FI Accumulation Units                              1,988,299       318,789        207,059        32,436
Series FM Accumulation Units                              1,745,516       329,755      1,217,457       229,906


SF 135R2S
- ---------

Series SU Accumulation Units                              4,886,186       942,800        947,851       188,764
Series SV Accumulation Units                              7,552,784     1,366,412        745,648       142,445
Series FM Accumulation Units                                511,763        95,847         74,328        14,079
Series FG Accumulation Units                              5,215,983       786,021        403,700        61,003
Series FO Accumulation Units                              2,521,718       501,641        105,526        21,247


Year ended December 31, 1994:

SF 135R; SF 226RI Contracts
- ---------------------------

Series B Accumulation Units                                 450,410        59,234      1,964,889       255,231
Series G Accumulation Units                               2,256,171       255,847     11,816,179     1,346,467
Series M Accumulation Units                                   3,404           513      1,896,616       286,075
Series T Accumulation Units                                  25,699         2,710     11,921,075     1,244,060
Series FA Accumulation Units                             18,699,464     3,451,499      1,087,647       202,875
Series FG Accumulation Units                              8,227,024     1,580,400        278,031        53,770
Series FI Accumulation Units                                588,897       113,711          6,953         1,338
Series FO Accumulation Units                              1,019,668       174,720         22,111         3,810
Series FM Accumulation Units                              1,187,375       234,573        571,042       111,981
</TABLE>




                                       23
<PAGE>   126
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)




NOTE 4 -- CAPITAL TRANSACTIONS (continued)

<TABLE>
<CAPTION>
                                                          Additions to Capital     Deductions From Capital
                                                             $           Units          $          Units
                                                           -----         -----        -----        -----
<S>                                                      <C>            <C>         <C>           <C>   
SF 234; SF 89; SF 224FL; SF 236FL; SF 1700 Contracts
- ----------------------------------------------------

Series B Accumulation Units                               2,365,192     145,428     1,129,840      70,689
Series G Accumulation Units                              19,236,016     714,441     5,089,591     188,577
Series M Accumulation Units                                     163          17       585,099      60,337
Series T Accumulation Units                              20,139,827     857,260     3,462,610     148,948
Series P Accumulation Units                                 610,483      49,901     1,175,446      96,364
Series I Accumulation Units                               4,068,516     585,985       528,232      76,552
Series FA Accumulation Units                              4,252,178     825,943       205,786      40,076
Series FG Accumulation Units                              2,075,220     420,944        87,975      17,729
Series FI Accumulation Units                                194,766      39,124         3,343         662
Series FM Accumulation Units                              3,785,144     753,094       945,024     186,554


SF 135R2S
- ---------

Series SU Accumulation Units                              3,327,573     685,345       246,138      51,484
Series SV Accumulation Units                              3,719,973     755,973       248,072      51,516
Series FM Accumulation Units                                289,695      56,479        10,040       1,962
Series FG Accumulation Units                              1,843,704     367,479        40,543       8,061
Series FO Accumulation Units                                952,968     191,482        18,926       3,926
</TABLE>


NOTE 5 -- UNITS OF CAPITAL

The following are the units outstanding and corresponding unit values as of
December 31, 1995:

<TABLE>
<CAPTION>
                                                     Units            Unit Value
                   Description                    Outstanding         $
                   -----------                    -----------         ----------
<S>                                               <C>                 <C>  
SF 135R2C; SF 226 RI Contracts
- ------------------------------

Series B Accumulation Units                          170,728             8.55
Series G Accumulation Units                        1,105,394            11.46   
Series FA Accumulation Units                       5,868,185             6.02
Series FG Accumulation Units                       3,819,793             7.13
Series FI Accumulation Units                         610,372             7.04
Series FO Accumulation Units                         219,402             6.14
Series FM Accumulation Units                         743,389             5.40
Series SU Accumulation Units                          19,715             5.43
Series AS Accumulation Units                         734,300             6.54
Series SI Accumulation Units                          65,505             5.84
Series FC Accumulation Units                         933,682             6.29
Series FE Accumulation Units                         131,121             6.13
</TABLE>

                                       24
<PAGE>   127
SECURITY FIRST LIFE SEPARATE ACCOUNT A

NOTES TO FINANCIAL STATEMENTS (continued)




NOTE 5 -- UNITS OF CAPITAL (continued)

<TABLE>
<CAPTION>
                                                         Units        Unit Value
                   Description                        Outstanding     $
                   -----------                        -----------     ----------
<S>                                                   <C>             <C>  
SF 234; SF 89; SF 224FL; SF 236FL; SF 1700 Contracts   
- ----------------------------------------------------   

Series B Accumulation Units                              277,508        18.25
Series G Accumulation Units                            1,640,191        35.31
Series T Accumulation Units                            1,430,263        30.44
Series P Accumulation Units                              202,251        12.97
Series I Accumulation Units                            1,118,228         7.45
Series FA Accumulation Units                           1,475,597         5.79
Series FG Accumulation Units                           1,386,442         6.84
Series FI Accumulation Units                             325,198         6.83
Series FM Accumulation Units                             666,389         5.42


SF 135R2S
- ---------

Series SU Accumulation Units                           1,692,672         5.40
Series SV Accumulation Units                           2,186,595         5.98
Series FM Accumulation Units                             140,365         5.44
Series FG Accumulation Units                           1,084,436         6.99
Series FO Accumulation Units                             667,950         5.24
</TABLE>


NOTE 6 -- SECURITY FIRST TRUST - MONEY MARKET SERIES INVESTMENT OPTION

Effective January 31, 1994, the Security First Trust Money Market Series (Series
M) was closed and liquidated. Policyholders were notified of this and allowed to
transfer their funds. The Fidelity Investments VIP Money Market Fund has similar
investment objectives and many policyholders elected to transfer their Security
First Trust Money Market investments into it.
    



                                       25
<PAGE>   128
                                  [LETTERHEAD]



                         Report of Independent Auditors




Board of Directors
Security First Life Insurance Company

   
We have audited the accompanying consolidated balance sheets of Security First
Life Insurance Company and subsidiaries as of December 31, 1995 and 1994, and
the related consolidated statements of income, stockholder's equity, and cash
flows for each of the three years in the period ended December 31, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Security First
Life Insurance Company and subsidiaries at December 31, 1995 and 1994, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1995, in conformity with generally
accepted accounting principles.

As discussed in Notes 3 and 5 to the consolidated financial statements, Security
First Life Insurance Company and subsidiaries made certain accounting changes in
1994 and 1993.

                                        /s/ Ernst & Young
                                        -----------------
                                        Ernst & Young



February 9, 1996
    

<PAGE>   129
   
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                             December 31
                                                        1995             1994
                                                        ----             ----
                                                            (In thousands)
<S>                                                  <C>              <C>       
ASSETS

INVESTMENTS
    Fixed maturities:
       Available-for-sale                            $2,176,985       $1,602,387
       Held-for-investment                                               197,379
    Equity securities                                     5,129            5,827
    Investment real estate                                2,311            2,298
    Policy and mortgage loans                            18,798           16,239
    Short-term investments                                7,024           26,215
                                                     ----------       ----------
                                                      2,210,247        1,850,345

CASH AND CASH EQUIVALENTS                                 7,990           13,359

ACCRUED INVESTMENT INCOME                                30,459           27,018

DEFERRED POLICY ACQUISITION COSTS                        56,515           47,985

OTHER ASSETS
    Property under capital lease                         10,680           11,260
    Assets held in separate accounts                    340,287          184,196
    Other                                                 4,318            4,517
                                                     ----------       ----------



                                                     $2,660,496       $2,138,680
                                                     ==========       ==========
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.

                                       2
<PAGE>   130
<TABLE>
<CAPTION>
                                                                       December 31
                                                                   1995           1994
                                                                   ----           ----
                                                                      (In thousands)
<S>                                                             <C>            <C>       
LIABILITIES AND STOCKHOLDER'S EQUITY

LIABILITIES
    Policyholder liabilities                                    $2,047,818     $1,790,456
    Obligation under capital lease                                  15,966         16,183
    Notes payable to parent                                         35,000         35,000
    Note payable                                                     1,000          2,000
    Federal income taxes                                            35,052          1,723
    Liabilities related to separate accounts                       340,287        184,196
    Other                                                            5,293          5,060
                                                                ----------     ----------
                                                                 2,480,416      2,034,618

COMMITMENTS AND CONTINGENCIES

STOCKHOLDER'S EQUITY
    Preferred stock, $1 par value
       Authorized, issued and outstanding -- 200,000 shares            200            200
    Common stock, $200 par value
       Authorized -- 15,000 shares
       Issued and outstanding -- 11,000 shares                       2,200          2,200
    Additional paid-in capital                                      48,147         48,147
    Net unrealized investment gains (losses)                        38,972        (21,561)
    Retained earnings                                               90,561         75,076
                                                                ----------     ----------
                                                                   180,080        104,062
                                                                ----------     ----------

                                                                $2,660,496     $2,138,680
                                                                ==========     ==========
</TABLE>



                                       3
<PAGE>   131
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                                   Year Ended December 31
                                                                1995        1994         1993
                                                                ----        ----         ----
                                                                       (In thousands)
<S>                                                           <C>         <C>          <C>     
REVENUES
    Net investment income                                     $158,174    $146,101     $137,450
    Annuity product income                                      14,815       6,121        2,499
    Net realized investment gains (losses)                       1,347      (1,735)         921
    Other                                                          701         709          721
                                                              --------    --------     --------
                                            TOTAL REVENUES     175,037     151,196      141,591


BENEFITS AND EXPENSES
    Interest credited to policyholders                         103,959     102,776      102,513
    Benefits in excess of policyholder liabilities               5,738       4,119        1,907
    Amortization of deferred policy acquisition costs           15,505       5,612        1,981
    Operating expenses                                          28,201      23,543       17,397
                                                              --------    --------     --------
                               TOTAL BENEFITS AND EXPENSES     153,403     136,050      123,798
                                                              --------    --------     --------
                                                                21,634      15,146       17,793


Income tax expense
    Current                                                      3,044       1,776        5,467
    Deferred                                                     3,105       3,388          597
                                                              --------    --------     --------
                                                                 6,149       5,164        6,064
                                                              --------    --------     --------

                           INCOME BEFORE CUMULATIVE EFFECT
                         OF CHANGE IN ACCOUNTING PRINCIPLE      15,485       9,982       11,729


Cumulative effect of change in accounting for income taxes                                1,510
                                                              --------    --------     --------

                                                NET INCOME    $ 15,485    $  9,982     $ 13,239
                                                              ========    ========     ========
</TABLE>




The accompanying notes are an integral part of these consolidated financial
statements.


                                       4
<PAGE>   132
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY

<TABLE>
<CAPTION>
                                                                                 Net
                                                                Additional    Unrealized              Total
                                         Preferred   Common      Paid-in      Investment    Retained  Stockholder's
                                         Stock       Stock       Capital    Gains (Losses)  Earnings  Equity
                                         -----       -----       -------    --------------  --------  ------
                                                                      (In thousands)  
<S>                                      <C>         <C>        <C>         <C>             <C>       <C>     
Balance at January 1, 1993                 $200      $2,200      $48,147      $    226      $51,855     $102,628
                                                                           
   Net income                                                                                13,239       13,239
                                                                           
   Net unrealized investment losses                                               (269)                     (269)
                                           ----      ------      -------      --------      -------     --------
                                                                           
Balance at December 31, 1993                200       2,200       48,147           (43)      65,094      115,598
                                                                           
                                                                           
   Net income                                                                                 9,982        9,982
                                                                           
   Cumulative effect of change in                                          
     accounting principle at January 1                                          28,618                    28,618
                                                                           
                                                                           
   Net unrealized investment losses                                            (50,136)                  (50,136)
                                           ----      ------      -------      --------      -------     --------
                                                                           
Balance at December 31, 1994                200       2,200       48,147       (21,561)      75,076      104,062
                                                                           
                                                                           
   Net income                                                                                15,485       15,485
                                                                           
                                                                           
   Net unrealized investment gains                                              60,533                    60,533
                                           ----      ------      -------      --------      -------     --------
                                                                           
Balance at December 31, 1995               $200      $2,200      $48,147      $ 38,972      $90,561     $180,080
                                           ====      ======      =======      ========      =======     ========
</TABLE>




The accompanying notes are an integral part of these consolidated financial
statements.


                                       5
<PAGE>   133
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                          Year Ended December 31
                                                                  1995            1994             1993
                                                                  ----            ----             ----
                                                                              (In thousands)
<S>                                                            <C>            <C>              <C>        
OPERATING ACTIVITIES
    Net income                                                 $  15,485      $     9,982      $    13,239
    Adjustments to reconcile net income to net cash                                               
       provided by operations:                                                                    
           Cumulative effect of accounting change                                                   (1,510)                         
           Net realized investment losses (gains)                 (1,347)           3,014          (12,121)
           Depreciation and amortization                           1,391            2,281            1,703
           Accretion of discount and amortization of                                              
               premium on investments                              1,059           (2,423)          (8,212)
           Changes in operating assets and liabilities:                                           
                  Accrued investment income                       (3,441)            (648)          (3,957)
                  Deferred policy acquisition costs              (15,676)          (4,915)         (16,946)
                  Other assets                                     2,194            4,560           (4,504)
                  Other liabilities                                  673           (9,050)           2,207
                                                               ---------      -----------      -----------
                                      NET CASH PROVIDED BY                                        
                            (USED IN) OPERATING ACTIVITIES           338            2,801          (30,101)
INVESTING ACTIVITIES                                                                              
    Fixed maturity securities -- available-for-sale                                               
       Purchases                                                (636,371)      (1,033,097)        
       Sales and maturities                                      439,897          860,239         
    Fixed maturity securities -- held-for-investment                                              
       Purchases                                                                                (1,037,222)
                                                                                                  
       Sales and maturities                                                                        783,570
    Equity securities                                                                             
       Purchases                                                    (117)                         
       Sales                                                         931            1,085         
    Disposal (acquisition) of real estate, net                       (13)           2,192             (161)
    Net sale (purchase) of short-term investments                 19,191          (26,215)        
    Repayment (issuance) of loans, net                            (2,558)           5,792             (359)
    Purchase of equipment                                           (388)            (896)        
                                                               ---------      -----------      -----------
                                          NET CASH USED IN                                        
                                      INVESTING ACTIVITIES      (179,428)        (190,900)        (254,172)
FINANCING ACTIVITIES                                                                              
    Receipts credited to policyholder accounts                   565,698          468,898          509,223
    Amounts returned to policyholders                           (390,760)        (326,691)        (208,422)
    Issuance of note payable to parent                                             10,000           25,000         
    Repayment of notes payable                                    (1,000)          (1,000)          (1,000)
    Reduction of capital lease obligation                           (217)            (192)            (170)
                                                               ---------      -----------      -----------
                                         NET CASH PROVIDED                                        
                                   BY FINANCING ACTIVITIES       173,721          151,015          324,631
                                                               ---------      -----------      -----------
                                                                                                  
                                    INCREASE (DECREASE) IN                                        
                                 CASH AND CASH EQUIVALENTS        (5,369)         (37,084)          40,358
Cash and cash equivalents at beginning of year                    13,359           50,443           10,085
                                                               ---------      -----------      -----------
                                             CASH AND CASH                                        
                                EQUIVALENTS AT END OF YEAR     $   7,990      $    13,359      $    50,443
                                                               =========      ===========      ===========
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.


                                       6
<PAGE>   134
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1995 AND 1994


NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION -- Security First Life Insurance Company (Security First
Life) and subsidiaries (collectively, the Company) is a wholly-owned subsidiary
of Security First Group, Inc. (SFG), formerly The Holden Group, Inc. SFG has
been a wholly-owned subsidiary of London Insurance Group, Inc. (LIG) since May
1994. The Company sells a broad range of fixed and variable annuity contracts.
The Company's consolidated financial statements are prepared in conformity with
generally accepted accounting principles (GAAP) which vary in some respects from
statutory accounting practices prescribed or permitted by regulatory authorities
(statutory basis) and include the accounts of its wholly-owned subsidiaries,
Fidelity Standard Life Insurance Company (Fidelity Standard Life) and Security
First Life Insurance Company of Arizona (SFL-Arizona). All significant
intercompany transactions and accounts are eliminated in consolidation.

INVESTMENTS -- Investments are reported on the following bases:

     Fixed Maturities:

         Available-for-sale -- at fair value, which differs from the amortized
         cost of such investments. Unrealized gains and losses on these
         investments (net of related adjustments for deferred policy acquisition
         costs and applicable deferred income taxes) are credited or charged to
         stockholder's equity and, accordingly, have no effect on net income.

         Held-for-investment -- at cost, adjusted for amortization of premium or
         accretion of discount and other-than-temporary declines in fair value.
         The amortized cost of such investments differs from their fair values.
         See Note 3 regarding the reclassification in 1995 of
         held-for-investment securities to available-for-sale.

         For those fixed maturities which are mortgage-backed, the Company
         recognizes income using a constant effective yield based on anticipated
         prepayments and the estimated economic life of the securities. When
         actual prepayments differ significantly from anticipated prepayments,
         the effective yield is recalculated to reflect actual payments to date
         and anticipated future payments. The net investment in the security is
         adjusted to the amount that would have existed had the new effective
         yield been applied since the acquisition of the security. Such
         adjustment is included in net investment income.

         The Company does not maintain a trading portfolio, or at December 31,
         1995, a held-for-investment portfolio.




                                       7
<PAGE>   135
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

     Equity securities (common and non-redeemable preferred stocks) -- at fair
     value if publicly traded. Changes in fair values of equity securities, net
     of applicable deferred income taxes, are reported as unrealized gains or
     losses directly in stockholder's equity and, accordingly, have no effect on
     net income.

     Investment real estate -- at lower of cost less accumulated depreciation or
     fair value.

     Mortgage loans and policy loans -- at unpaid balances.

     Short-term investments -- at cost, which approximates fair value.

     Realized gains and losses on disposal of investments are determined on a
     specific identification basis.

CASH EQUIVALENTS -- Cash equivalents consist of investments in money market
funds. The carrying amount of cash equivalents approximates fair value.

DEFERRED POLICY ACQUISITION COSTS -- As of January 1, 1995, the Company adopted
the account value deposit method of reporting on two-tier annuities (those
annuities that have a different interest credited rate for annuitization as
compared to withdrawal). The Company had previously adopted this method for
single-tier annuities. Under this method, commissions and other costs of
acquiring annuities that vary with and are primarily related to the acquisition
of such business are included in deferred policy acquisition costs. Prior to
that date, certain commission costs for two-tier annuities were reported as a
component of policyholder liabilities. As a result of this change, deferred
policy acquisition costs and policyholder liabilities increased by $38,590,000
on January 1, 1995 with no effect on stockholder's equity. Additionally, the
presentation of certain revenue and expense items in the consolidated statement
of income for the year ended December 31, 1995 has been effected by this change
with no significant impact on net income.

Deferred policy acquisition costs are being amortized in proportion to the
present value of estimated future gross margins which includes the impact of
realized investment gains and losses.




                                       8
<PAGE>   136
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

POLICYHOLDER LIABILITIES -- As indicated previously, the Company adopted the
account value deposit method for reporting on two-tier annuities as of January
1, 1995. Under this method, the policyholder liabilities for two-tier annuities
are the lower tier account values. Prior to that date, policyholder liabilities
for the Company's two-tier fixed annuity products were calculated using a
prospective approach. Under the prospective approach, the policyholder liability
was equal to the present value of future benefits using a "break-even" discount
rate which resulted in no gain or loss when a policy was issued. This method
allowed profits to emerge in relation to the difference between actual
investment earnings and the break-even discount rate used in the calculation of
the policyholder liabilities. Policyholder liabilities for the Company's
single-tier fixed annuity products are the account values.

The fair value of policyholder liabilities is estimated assuming all
policyholders surrender their policies. The carrying amounts and estimated fair
values are as follows (in thousands):

<TABLE>
<CAPTION>
                                    Carrying Amount      Estimated Fair Value
                                    ---------------      --------------------
<S>                                 <C>                  <C>       
     December 31, 1995                $2,047,818              $1,976,079
     December 31, 1994                 1,790,456               1,760,999
</TABLE>

NOTES PAYABLE -- Notes payable are carried at their unpaid balances which
approximate fair value because the interest rates on these notes approximate
market rates.

INCOME TAXES -- The Company files consolidated federal income tax returns with
SFG. Income taxes are provided on the basis as if the companies filed
separately.

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. Such differences are related principally to the deferral of policy
acquisition costs, the valuation of fixed maturities and the provision for
policyholder liabilities. Deferred tax assets and liabilities are measured 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 effect
on deferred tax assets and liabilities of a change in tax rates is recognized in
income in the period that includes the enactment date.

SEPARATE ACCOUNTS -- The assets held in separate accounts represent funds which
are separately administered by the Company pursuant to variable annuity
contracts. The liabilities related to separate accounts consist of policyholder
liabilities for variable annuities. The separate account assets and liabilities
are reported at fair value. The Company receives a fee for administrative
services provided to the separate accounts. Investment risks associated with
fair value changes are borne by the contract holders.



                                       9
<PAGE>   137
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

ANNUITY REVENUES AND BENEFITS -- Annuity product income represents fees earned
from policyholders of annuity contracts, including surrender charges,
annuitization charges and administration fees. Benefits in excess of
policyholder liabilities consists of the difference between the policyholder
account values surrendered or annuitized during the period and the related
policyholder liability balances.

ESTIMATES -- Certain amounts reported in the accompanying consolidated financial
statements are based on management's best estimates and judgments. Actual
results could differ from those estimates.

NEW ACCOUNTING STANDARD -- In March 1995, the Financial Accounting Standards
Board (FASB) issued a new standard on accounting for long-lived assets which are
impaired or to be disposed of. The Company must adopt the standard by 1996. The
standard requires that an impaired long-lived asset be measured based on the
fair value of the asset to be held and used or the fair value less cost to sell
the asset to be disposed of. When adopted, this standard is not expected to have
a material effect on the financial position or results of operations of the
Company.

RECLASSIFICATIONS -- Certain reclassifications of prior-year amounts have been
made to conform with current-year classifications.



                                       10
<PAGE>   138
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 2 -- STATUTORY CAPITAL AND RESTRICTIONS

Security First Life and each of its subsidiaries are required to file annual
statements with various state insurance regulatory authorities on a statutory
basis.

The statutory-basis capital and surplus at December 31, 1995, 1994 and 1993, and
statutory-basis net income (loss) for those years are as follows (in thousands):

<TABLE>
<CAPTION>
                                                                       Capital               Net
                                                                     and Surplus        Income (Loss)
                                                                     -----------        -------------
     December 31, 1995
     -----------------

<S>                                                                   <C>               <C>    
     Security First Life Insurance Company                            $100,027*            $3,161*
     Fidelity Standard Life Insurance Company                           15,573*               831*
     Security First Life Insurance Company of Arizona                   12,715*               612*

     December 31, 1994
     -----------------

     Security First Life Insurance Company                            $ 99,272             $1,758
     Fidelity Standard Life Insurance Company                           14,894                409
     Security First Life Insurance Company of Arizona                   12,118              1,246

     December 31, 1993
     -----------------

     Security First Life Insurance Company                            $ 90,967             $5,057
     Fidelity Standard Life Insurance Company                           14,651               (160)
     Security First Life Insurance Company of Arizona                   10,890              1,358
</TABLE>

         * These unaudited amounts are preliminary and subject to change upon
           completion of the statutory annual statements.

The difference between statutory-basis net income (loss) and net income reported
based on GAAP relates primarily to different reserving methods used to calculate
policyholder liabilities, the recognition of deferred policy acquisition costs
and deferred income taxes.

Security First Life and Fidelity Standard Life are incorporated and domiciled in
Delaware. SFL-Arizona is incorporated and domiciled in Arizona. The payment of
dividends by Security First Life and each of its subsidiaries is subject to
statutory limitations which are based on each company's statutory-basis net
income and surplus levels. At December 31, 1995, the maximum amount of dividends
Security First Life could pay SFG without prior approval from state insurance
regulatory authorities is $9,762,000.




                                       11
<PAGE>   139
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 3 -- INVESTMENTS

The Company adopted Statement of Financial Accounting Standards No. 115 (SFAS
No. 115), Accounting for Certain Investments in Debt and Equity Securities, as
of January 1, 1994. In accordance with SFAS No. 115, prior period financial
statements were not restated to reflect the change in accounting principle. The
cumulative effect as of January 1, 1994 of adopting SFAS No. 115 was an increase
in stockholder's equity of $28,618,000 -- net of related adjustments for
deferred policy acquisition costs of $62,166,000 which was recorded as an
adjustment to policyholder liabilities and deferred income taxes of $14,743,000
- -- to reflect the net unrealized gains on securities previously carried at
amortized cost. There was no effect on net income as a result of the adoption of
SFAS No. 115.

In November 1995, the FASB issued a Special Report, A Guide to Implementation of
Statement 115 on Accounting for Certain Investments in Debt and Equity
Securities. In accordance with provisions in that Special Report, the Company
chose to reclassify securities from held-for-investment to available-for-sale.
At the date of transfer, the amortized cost of those securities was $169,879,000
and the unrealized gain on those securities was $2,291,000, which is included in
stockholder's equity.

Unrealized investment gains and losses reported in the accompanying financial
statements are as follows (in thousands):

<TABLE>
<CAPTION>
                                                                             December 31
                                                                         1995          1994
                                                                         ----          ----
<S>                                                                    <C>           <C>      
     Unrealized investment gains (losses)                              $104,593      $(76,004)
     Less:   Adjustment for deferred policy acquisition costs            45,736       (43,719)
             Deferred income taxes (benefit)                             19,885       (10,724)
                                                                       --------      --------

                      Net unrealized investment gains (losses)         $ 38,972      $(21,561)
                                                                       ========      ========
</TABLE>

The adjustment for deferred policy acquisition costs of $43,719,000 in 1994 was
recorded as an adjustment to policyholder liabilities. Included in unrealized
investment gains (losses) are net losses related to equity securities of $58,000
and $230,000 at December 31, 1995 and 1994, respectively.




                                       12
<PAGE>   140
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 3 -- INVESTMENTS (continued)

The amortized cost and fair value of fixed maturities as of December 31, 1995
and 1994 are summarized as follows (in thousands):

<TABLE>
<CAPTION>
                                                                       Gross          Gross
                                                       Amortized     Unrealized     Unrealized      Fair
                                                         Cost          Gains          Losses        Value
                                                         ----          -----          ------        -----
<S>                                                    <C>           <C>            <C>           <C>       
   December 31, 1995
   -----------------

   Available-for-sale:
     U.S. Treasury securities and
          obligations of U.S. Government
          corporations and agencies                    $  131,672     $ 12,467      $   (153)     $  143,986
     Debt securities issued by foreign governments         16,779        1,687                        18,466
     Corporate securities                                 894,766       64,723        (5,194)        954,295
     Mortgage-backed securities                         1,029,090       33,049        (1,901)      1,060,238
                                                       ----------     --------      --------      ----------
                                                       $2,072,307     $111,926      $ (7,248)     $2,176,985
                                                       ==========     ========      ========      ==========


   December 31, 1994
   -----------------

   Available-for-sale:
     U.S. Treasury securities and
          obligations of U.S. Government
          corporations and agencies                    $  114,207     $  2,100      $ (4,649)     $  111,658
     Debt securities issued by foreign
          governments                                      21,916          334          (481)         21,769
     Corporate securities                                 760,618        9,679       (39,496)        730,801
     Mortgage-backed securities                           781,296        6,735       (49,872)        738,159
                                                       ----------     --------      --------      ----------
                                                       $1,678,037     $ 18,848      $(94,498)     $1,602,387
                                                       ==========     ========      ========      ==========


   Held-for-investment:
     Mortgage-backed securities                        $  197,379     $  1,471      $(13,215)     $  185,635
                                                       ==========     ========      ========      ==========
</TABLE>




                                       13
<PAGE>   141
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 3 -- INVESTMENTS (continued)

The amortized cost and fair value of fixed maturities by contractual maturity at
December 31, 1995, are summarized below. Actual maturities will differ from
contractual maturities because certain borrowers have the right to call or
prepay obligations.

<TABLE>
<CAPTION>
                                                          Amortized                Fair
                                                            Cost                   Value
                                                            ----                   -----
                                                                   (In thousands)
<S>                                                       <C>                    <C>       
   Available-for-sale:
     Due in one year or less                              $   18,459             $   18,666
     Due after one year through five years                   162,465                172,269
     Due after five years through ten years                  580,386                611,671
     Due after ten years                                     281,907                314,142
     Mortgage-backed securities                            1,029,090              1,060,237
                                                          ----------             ----------
                                                          $2,072,307             $2,176,985
                                                          ==========             ==========
</TABLE>


Proceeds from sales of fixed maturities are $441,790,000 and $695,755,000 in
1995 and 1994, respectively.

The Company reports realized gains (losses) on investment transactions net of
any adjustment to the amortization of deferred policy acquisition costs when
such amortization is accelerated or decelerated as a result of the realization
of gains or losses other than as originally anticipated on the sale of
investments associated with annuity products. Net realized investment gains
(losses) reported in the accompanying financial statements are as follows (in
thousands):

<TABLE>
<CAPTION>
                                                            1995         1994          1993
                                                            ----         ----          ----
<S>                                                       <C>          <C>           <C>     
   Fixed maturities -- available-for-sale
     Gross gains                                          $ 6,181      $ 7,174
     Gross losses                                          (4,621)      (6,328)
                                                          -------      -------
                                                            1,560          846
   Fixed maturities -- held-for-investment
     Gross gains                                                                     $ 14,755
     Gross losses                                                                      (2,634)
                                                                                     --------
                                                                                       12,121

   Loss on equity securities                                 (213)         (31)
   Loss on real estate                                                  (2,250)
   Accelerated amortization
     of deferred policy acquisition costs                                 (300)       (11,200)
                                                          -------      -------       ---------

          Net realized investment gains (losses)          $ 1,347      $(1,735)      $    921
                                                          =======      =======       ========
</TABLE>



                                       14
<PAGE>   142
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 3 -- INVESTMENTS (continued)

The Company has recorded a valuation reserve for possible other-than-temporary
impairment in the value of fixed maturities of $2,000,000 at December 31, 1995
and 1994.

Concentrations of credit risk with respect to fixed maturities are limited due
to the large number of issues owned and their dispersion across many different
industries and geographic areas. Accordingly, at December 31, 1995, the Company
had no significant concentration of credit risk.

The fair values for fixed maturities and equity securities are primarily based
on values obtained from independent pricing services.

The cost of equity securities was $5,214,000 and $6,177,000 on December 31, 1995
and 1994, respectively.

Investment real estate is net of accumulated depreciation of $1,596,000 and
$1,538,000 as of December 31, 1995 and 1994, respectively, and a $2,250,000
provision for decline in fair value at those dates.

The carrying amount of mortgage loans ($945,000 and $934,000 at December 31,
1995 and 1994, respectively) and policy loans ($17,853,000 and $15,305,000 at
December 31, 1995 and 1994, respectively) approximates fair value because the
interest rates on these loans approximate market rates.

The Company places its temporary cash investments with high-credit quality
financial institutions and, by corporate policy, limits the amount of credit
exposure to any one financial institution.

At December 31, 1995, investment securities having an amortized cost of
$10,561,000 were on deposit with various states in accordance with state
insurance department requirements.




                                       15
<PAGE>   143
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


NOTE 3 -- INVESTMENTS (continued)

Investment income by major category of investment is summarized as follows (in
thousands):

<TABLE>
<CAPTION>
                                                       1995           1994          1993
                                                       ----           ----          ----
<S>                                                  <C>            <C>           <C>     
     Fixed maturities                                $159,266       $148,303      $139,404
     Policy loans                                         884            749           620
     Real estate                                          894            406           367
     Mortgage loans                                       345            769           974
     Short-term investments                             1,943            114
     Cash and cash equivalents                            388            783           831
                                                     --------       --------      --------
                                                      163,720        151,124       142,196

     Investment expenses                               (5,546)        (5,023)       (4,746)
                                                     ---------      --------      --------

                            Net investment income    $158,174       $146,101      $137,450
                                                     ========       ========      ========
</TABLE>


The Company has no significant amounts of non-income producing investments.


NOTE 4 -- NOTES PAYABLE

Notes payable consist of the following as of December 31 (in thousands):


<TABLE>
<CAPTION>
                                                                         1995        1994
                                                                         ----        ----
<S>                                                                   <C>         <C>    
     5% Surplus note due to SFG, interest payable monthly,
     principal payable upon regulatory approval                       $25,000     $25,000

     8% Note due to The Capitol Life Insurance Company,
     interest payable quarterly, principal payments of $1,000,000
     each paid annually on December 31                                  1,000       2,000

     8% Surplus note due to SFG, interest payable monthly,
     principal payable upon regulatory approval                        10,000      10,000
                                                                      -------     -------

                                                                      $36,000     $37,000
                                                                      =======     =======
</TABLE>


Security First Life has a $15,000,000 bank revolving credit line which bears
interest at a floating rate based on London Interbank Offered Rates. There were
no borrowings outstanding under this revolving credit line at December 31, 1995
and 1994. The $25,000,000 and $10,000,000 surplus notes payable to SFG are
pledged, along with the common and preferred stock of Security First Life, as
collateral for SFG's bank revolving credit line.

Principal payments due on the notes payable during the next five years are
$1,000,000 in 1996.



                                       16
<PAGE>   144
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)



NOTE 4 -- NOTES PAYABLE (continued)

Interest paid by the Company totaled $2,225,000 in 1995, $1,799,000 in 1994 and
$343,000 in 1993.


NOTE 5 -- INCOME TAXES

The Company files a consolidated federal income tax return with SFG and its
subsidiaries. Taxes are provided for and paid to SFG as if the Company filed
separately.

The Company adopted Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes, effective January 1, 1993 and, as permitted under
the new rules, did not restate prior years' financial statements. The cumulative
effect of this change in accounting for income taxes as of January 1, 1993 of
$1,510,000 is reported separately in the consolidated statement of income for
the year ended December 31, 1993.

The liability for federal income taxes includes deferred taxes of $35,875,000
and $3,324,000 at December 31, 1995 and 1994, respectively. Significant
components of these deferred taxes are as follows (in thousands):

<TABLE>
<CAPTION>
                                                                        1995           1994
                                                                        ----           ----
<S>                                                                    <C>            <C>    
Deferred tax liabilities:
     Deferred policy acquisition costs                                 $32,937        $14,701
     Fixed maturities                                                   19,980
     Other assets                                                                         301
     Other, net                                                            495          1,050
                                                                       -------        -------
                            Total deferred tax liabilities              53,412         16,052

Deferred tax assets:
     Fixed maturities                                                                   8,654
     Policyholder liabilities                                           13,384          1,674
     Capital lease                                                         765            628
     Other liabilities                                                   3,388          1,772
                                                                       -------        -------
                                 Total deferred tax assets              17,537         12,728
                                                                       -------        -------
                              Net deferred tax liabilities             $35,875        $ 3,324
                                                                       =======        =======
</TABLE>


Income taxes paid by the Company were $3,248,000 in 1995, $2,000,000 in 1994 and
$4,325,000 in 1993.



                                       17
<PAGE>   145
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)



NOTE 5 -- INCOME TAXES (continued)

In 1995, the Company's income tax provision differs from the statutory rate of
34%. The following is a reconciliation of the federal income tax at statutory
rates with the income tax provision as shown in the consolidated statement of
income for the year ended December 31, 1995 (in thousands):

<TABLE>
<S>                                                                <C>   
     Federal income tax at 34%                                     $7,356
     Dividends received deduction                                    (317)
     True up of prior year taxes                                     (875)
     Other                                                            (15)
                                                                   ------

              Provision for income tax expense                     $6,149
                                                                   ======
</TABLE>


NOTE 6 -- CAPITAL LEASE

Security First Life has a lease for office space that expires in 2014. This
lease is treated as a capital lease for financial reporting purposes.

The Company subleases space on an annual basis to SFG to use as its home office.
Related income offset against the lease costs was $1,663,000, $1,649,000 and
$1,578,000 for the years ended December 31, 1995, 1994 and 1993, respectively.
Future payments under the lease are as follows (in thousands):

<TABLE>
<S>                                                                     <C>     
           1996                                                         $  2,166
           1997                                                            2,166
           1998                                                            2,166
           1999                                                            2,166
           2000                                                            2,166
           Thereafter                                                     29,051
                                                                        --------
                                 Total minimum rental payments            39,881
                                  Amount representing interest           (23,915)

                      Present value of minimum rental payments          $ 15,966
                                                                        ========
</TABLE>

The property under capital lease is net of accumulated amortization of
$6,717,000 in 1995 and $6,137,000 in 1994.




                                       18
<PAGE>   146
SECURITY FIRST LIFE INSURANCE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)



NOTE 7 -- COMMITMENTS, CONTINGENCIES AND RISKS

The Company has forward contracts with commitments to purchase mortgage-backed
securities with total par values of $25,500,000 at December 31, 1995. The
Company uses these contracts to hedge the interest rate risk on future
investments that match policyholder liabilities, primarily related to
guaranteed-rate products. Gains or losses realized on such contracts are
included in the carrying value of the underlying anticipated investment. The
Company is subject to the risk that the counterparties to such contracts would
fail to deliver the securities to the Company on settlement date, if the Company
were to hold the contract on that date. The Company's current cash balances and
expected future cash flows are sufficient to settle the commitments under these
forward contracts.

Included in the accompanying balance sheet are assets of $6,000,000 at December
31, 1995 related to The Capitol Life Insurance Company (CLICO) and its parent.
CLICO is currently operating under supervision by the Colorado Division of
Insurance. The Company anticipates that CLICO will continue as an ongoing
enterprise. However, there can be no certainty that this will occur.


NOTE 8 -- RELATED PARTY TRANSACTIONS

The Company has marketing and administrative agreements with SFG and previously
with its subsidiary, Holden Financial Company, under which these companies
provide all of the Company's marketing and policyholder administration services.
Amounts incurred under these agreements were $38,954,000, $31,183,000 and
$26,026,000 for 1995, 1994 and 1993, respectively.

The Company has management agreements with SFG under which the latter provides
certain personnel, administrative services and office space. Amounts incurred
under these agreements were $4,308,000 in 1995 and 1994 and $4,248,000 in 1993.

The Company has investment advisory agreements with Security First Investment
Management Corporation, a subsidiary of SFG. Fees of $4,756,000, $4,508,000 and
$4,067,000 were paid in 1995, 1994 and 1993, respectively, pursuant to these
agreements.

    


                                       19
<PAGE>   147
                                     PART C
                                OTHER INFORMATION

Item 24.       Financial Statements and Exhibits

         (a)   Financial Statements contained herein

                  (1) Security First Life Separate Account A

                           Part A - Condensed Financial Information
                           Part B - Statement of Assets and Liabilities, 
                                    Statement of Operations, Statement of 
                                    Changes in Net Assets, Statement of
                                    Investments

                  (2) Security First Life Insurance Company

                           Part B - Depositor's financial statements with notes

         (b)   Exhibits
                              
                           (10) Consent of Independent Auditors - herewith
                           (13) Organizational Chart - herewith
                           (27) Financial Data Schedule - herewith
                               

All previously filed Exhibits to Security First Life Separate Account A
registration statement and all post-effective amendments thereto are
specifically incorporated herein by reference.

Item 25.       Directors and Officers of the Depositor

The officers and directors of Security First Life Insurance Company are listed
below. Their principal business address is 11365 West Olympic Boulevard, Los
Angeles, California 90064.

<TABLE>
<CAPTION>
Name                                                  Position and Offices with Depositor
- ----                                                  -----------------------------------
<S>                                                   <C>
R. Brock Armstrong                                    Chairman of the Board and Director
Gordon R. Cunningham                                  Director
Frank E. Farella                                      Director
Melvin M. Hawkrigg                                    Director
General P.X. Kelley                                   Director
Robert G. Mepham                                      Director, President and Chief Executive Officer
Richard C. Pearson                                    Director, Senior Vice President, General Counsel
                                                      and Secretary
Howard H. Kayton                                      Executive Vice President and Chief Actuary
Robert D. Badun                                       Senior Vice President, Investments
Jane F. Eagle                                         Senior Vice President, Finance
Peter R. Jones                                        Senior Vice President, Public Services
Cheryl M. MacGregor                                   Senior Vice President, Administration
Alex H. Masson                                        Senior Vice President, Information Systems
Michael R. McCoy                                      Senior Vice President, Banking
</TABLE>
<PAGE>   148
<TABLE>
<S>                                                   <C>
Robert L. Pina                                        Senior Vice President, Human Resources
George R. Bateman                                     Vice President, Public Employees Services
James C. Turner                                       Vice President, Taxation
George J. Olah                                        Treasurer
</TABLE>

Item 26.       Persons Controlled by or under Common Control with Depositor of
               Registrant

   
The Registrant is a Separate Account of Security First Life Insurance Company
("depositor"). For a complete listing and diagram of all persons directly or
indirectly controlled by or under common control with the depositor, see Exhibit
13.
    

Item 27.       Number of Contractowners

   
As of December 31, 1995, there were 5,440 owners of the Contracts which are the
subject of this post-effective amendment.
    

Item 28.       Indemnification

None.

Item 29.       Principal Underwriters

Security First Financial, Inc., the principal underwriter for Security First
Life Separate Account A, also acts as principal underwriter for Fidelity
Standard Life Separate Account.

The following are the directors and officers of Security First Financial, Inc.
Their principal business address is 11365 West Olympic Boulevard, Los Angeles,
California 90064.

<TABLE>
<CAPTION>
Name                                                  Position with Underwriter
- ----                                                  -------------------------
<S>                                                   <C>
Robert Grant Mepham                                   Director and Chairman of the Board
Richard Carl Pearson                                  Director, President, General Counsel and Secretary
Jane Frances Eagle                                    Director, Senior Vice President, Finance and
                                                      Treasurer
Howard H. Kayton                                      Senior Vice President and Chief Actuary
James Cyrus Turner                                    Vice President, Taxation and Assistant Secretary
</TABLE>
<PAGE>   149
<TABLE>
<CAPTION>
                       Net Underwriting      Compensation on
Name of Principal      Discount and          Redemption or         Brokerage             
Underwriter            Commissions*          Annuitization         Commission            Compensation
- -----------------      ----------------      ---------------       ----------            ------------
<S>                    <C>                   <C>                   <C>                   <C>
Security First         None                  None                  None                  None
Financial, Inc.
</TABLE>

*Fee paid by Security First Life Insurance Company for serving as underwriter.

Item 30.       Location of Accounts and Records

Security First Financial, Inc., underwriter for the registrant, is located at
11365 West Olympic Boulevard, Los Angeles, California 90064. It maintains those
accounts and records required to be maintained by it pursuant to Section 31(a)
of the Investment Company Act of 1940 and the rules promulgated thereunder.

Security First Life Insurance Company, the depositor for the registrant, is
located at 11365 West Olympic Boulevard, Los Angeles, California 90064. It
maintains those accounts and records required to be maintained by it pursuant to
Section 31(a) of the Investment Company Act and the rules promulgated thereunder
and as custodian for the Registrant.

Security First Group, Inc. is located at 11365 West Olympic Boulevard, Los
Angeles, California 90064. It performs substantially all of the recordkeeping
and administrative services in connection with the Registrant.

Item 31.       Management Services

Not applicable.

Item 32.       Undertakings

Not applicable.
<PAGE>   150
                                   SIGNATURES

   
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant certifies that it meets the requirements of Securities Act
Rule 485 (b) for effectiveness of this Registration Statement and has duly
caused this amended Registration Statement to be signed on its behalf in the
City of Los Angeles and State of California on this 26th day of April 1996.

                            SECURITY FIRST LIFE SEPARATE ACCOUNT A
                                 (Registrant)

                            By SECURITY FIRST LIFE INSURANCE COMPANY
                                 (Sponsor)

                            By /s/ Robert G. Mepham
                               -------------------------------------
                                   Robert G. Mepham, President

As required by the Securities Act of 1933, this amended 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/ Robert G. Mepham                       President, Director                  April 26, 1996
- -----------------------------
Robert G. Mepham

/s/ Jane F. Eagle                          Principal Financial and              April 26, 1996
- -----------------------------              Accounting Officer
Jane F. Eagle                             

/s/ R. Brock Armstrong*                    Director                             April 26, 1996
- -----------------------------
R. Brock Armstrong

/s/ Gordon R. Cunningham*                  Director                             April 26, 1996
- -----------------------------
Gordon R. Cunningham

/s/ Melvin M. Hawkrigg*                    Director                             April 26, 1996
- -----------------------------
Melvin M. Hawkrigg

/s/ Paul X. Kelley*                        Director                             April 26, 1996
- -----------------------------
Paul X. Kelley
</TABLE>
    
<PAGE>   151
   
<TABLE>
<CAPTION>
Signature                            Title                                   Date
- ---------                            -----                                   ----
<S>                                 <C>                                 <C>
Frank E. Farella*                   Director                            April 26, 1996
- -----------------------------
Frank E. Farella

/s/ Richard C. Pearson              Director                            April 26, 1996
- -----------------------------
Richard C. Pearson

/s/ Richard C. Pearson                                                  April 26, 1996
- -----------------------------
*(Richard C. Pearson as
Attorney-in-Fact for each
of the persons indicated)
</TABLE>
    

<PAGE>   1
                                                                     EXHIBIT 10
                

CONSENT OF INDEPENDENT AUDITORS


We consent to the reference to our firm under the captions "Condensed Financial
Information" and "Independent Auditors" and to the use of our report on
Security First Life Separate Account A dated April 5, 1996 and our report on
Security First Life Insurance Company dated February 9, 1996 in the
Registration Statement (Form N-4 Post-Effective Amendment No. 25 under the
Securities Act of 1933 and No. 71 under the Investment Company Act of 1940)
contained in the Statement of Additional Information.




                                            ERNST & YOUNG LLP
                                            ----------------------------
                                            ERNST & YOUNG LLP


Los Angeles, California
April 26, 1996


                                        

<PAGE>   1
                                                                  EXHIBIT  13
                                                                  

                              ORGANIZATIONAL CHART

<TABLE>
<CAPTION>
<S>                <C>             <C>            <C>            <C>            <C>                 <C>            <C>

                                                  ------------------------------
                                                   Trilon Financial Corporation
                                                             (Canada)
                                                  ------------------------------

                                                  ------------------------------
                                                   London Insurance Group, Inc.
                                                             (Canada)
                                                  ------------------------------
                                                                                                
                                   ----------------------------     ---------------------------- 
                                            London Life              Security First Group, Inc.  
                                         Insurance Company                                       
                                             (Canada)                        95-3947585          
                                   ----------------------------     ---------------------------- 

 ----------------- -------------- --------------- -------------- -------------- ------------------- -------------- -----------------
  Security First   Security First                 Security First Security First  Security First                                     
 Insurance Agency, Group of Ohio, Security First  Life Insurance   Investment   Insurance Agency,   Security First  Security First  
     (Nevada)           Inc.      Financial, Inc.     Company      Management         Inc.            Management   Real Estate, Inc.
                                                                   Corporation   (Massachusetts)      Corporation                   
    88-0272002       34-1737227     95-2869421    DE       61050   95-2844896      95-3476150         95-4087137      95-4087153    
 ----------------- -------------- ---------------    54-0696644  --------------- ------------------- ------------- -----------------
                                                  --------------                                  

                                       -----------------     -------------------     
                                       Fidelity Standard     Security First Life     
                                        Life Insurance            Insurance          
                                            Company                Company           
                                                                 of Arizona          
                                        DE        93246        AZ        89010       
                                          51-0258372             86-0676035                       
                                       -----------------     -------------------                  
</TABLE>

                                                                           

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 1
   <NAME> B
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        6,524,502
<INVESTMENTS-AT-VALUE>                       6,530,291
<RECEIVABLES>                                    7,703
<ASSETS-OTHER>                                  14,473
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               6,552,467
<PAYABLE-FOR-SECURITIES>                        22,109
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                        5,973
<TOTAL-LIABILITIES>                             28,082
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          448,236
<SHARES-COMMON-PRIOR>                          392,775
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         5,789
<NET-ASSETS>                                 6,524,385
<DIVIDEND-INCOME>                              371,424
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                   1,744
<EXPENSES-NET>                                  56,396
<NET-INVESTMENT-INCOME>                        316,772
<REALIZED-GAINS-CURRENT>                      (36,646)
<APPREC-INCREASE-CURRENT>                      560,723
<NET-CHANGE-FROM-OPS>                          841,449
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        102,951
<NUMBER-OF-SHARES-REDEEMED>                     47,490
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       1,418,905
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 56,396
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 2
   <NAME> G
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                       58,200,522
<INVESTMENTS-AT-VALUE>                      70,635,406
<RECEIVABLES>                                   60,695
<ASSETS-OTHER>                                   8,944
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                              70,705,045
<PAYABLE-FOR-SECURITIES>                        65,348
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       60,391
<TOTAL-LIABILITIES>                            125,739
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        2,745,585
<SHARES-COMMON-PRIOR>                        2,315,800
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                    12,434,884
<NET-ASSETS>                                70,579,306
<DIVIDEND-INCOME>                            2,047,981
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                  22,216
<EXPENSES-NET>                                 555,472
<NET-INVESTMENT-INCOME>                      1,514,725
<REALIZED-GAINS-CURRENT>                     1,021,117
<APPREC-INCREASE-CURRENT>                   12,817,755
<NET-CHANGE-FROM-OPS>                       15,353,597
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        715,876
<NUMBER-OF-SHARES-REDEEMED>                    286,100
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                      21,841,259
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                555,472
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 6
   <NAME> FA
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                       39,902,742
<INVESTMENTS-AT-VALUE>                      43,931,846
<RECEIVABLES>                                   75,517
<ASSETS-OTHER>                                   3,180
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                              44,010,543
<PAYABLE-FOR-SECURITIES>                        71,222
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       58,591
<TOTAL-LIABILITIES>                            129,813
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        7,343,782
<SHARES-COMMON-PRIOR>                        4,862,757
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                     4,029,104
<NET-ASSETS>                                43,880,730
<DIVIDEND-INCOME>                              562,504
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                  10,299
<EXPENSES-NET>                                 414,098
<NET-INVESTMENT-INCOME>                        158,705
<REALIZED-GAINS-CURRENT>                        64,929
<APPREC-INCREASE-CURRENT>                    5,020,534
<NET-CHANGE-FROM-OPS>                        5,244,168
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                      3,516,847
<NUMBER-OF-SHARES-REDEEMED>                  1,035,822
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                      18,710,887
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                414,098
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 7
   <NAME> FG
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                       37,606,829
<INVESTMENTS-AT-VALUE>                      44,342,589
<RECEIVABLES>                                  213,505
<ASSETS-OTHER>                                   4,999
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                              43,561,903
<PAYABLE-FOR-SECURITIES>                       198,340
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       63,111
<TOTAL-LIABILITIES>                            261,451
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        6,290,671
<SHARES-COMMON-PRIOR>                        2,568,735
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                     6,735,760
<NET-ASSETS>                                44,299,642
<DIVIDEND-INCOME>                               81,618
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                 101,082
<EXPENSES-NET>                                 320,517
<NET-INVESTMENT-INCOME>                      (137,817)
<REALIZED-GAINS-CURRENT>                        93,864
<APPREC-INCREASE-CURRENT>                    6,383,879
<NET-CHANGE-FROM-OPS>                        6,339,926
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                      4,094,077
<NUMBER-OF-SHARES-REDEEMED>                    372,141
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                      30,743,085
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                320,517
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 8
   <NAME> FI
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        4,603,656
<INVESTMENTS-AT-VALUE>                       4,853,623
<RECEIVABLES>                                   64,542
<ASSETS-OTHER>                                  10,357
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               4,928,522
<PAYABLE-FOR-SECURITIES>                        61,878
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       17,156
<TOTAL-LIABILITIES>                             79,034
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          935,570
<SHARES-COMMON-PRIOR>                          183,362
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                       748,703
<NET-ASSETS>                                 6,520,998
<DIVIDEND-INCOME>                               20,704
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                  16,698
<EXPENSES-NET>                                  31,873
<NET-INVESTMENT-INCOME>                          5,529
<REALIZED-GAINS-CURRENT>                        36,253
<APPREC-INCREASE-CURRENT>                      741,445
<NET-CHANGE-FROM-OPS>                          783,227
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        806,482
<NUMBER-OF-SHARES-REDEEMED>                     54,274
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       5,575,113
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 31,873
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 9
   <NAME>
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        4,603,656
<INVESTMENTS-AT-VALUE>                       4,853,623
<RECEIVABLES>                                   62,379
<ASSETS-OTHER>                                       0
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               4,916,002
<PAYABLE-FOR-SECURITIES>                        62,436
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                        5,300
<TOTAL-LIABILITIES>                             11,543
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          887,352
<SHARES-COMMON-PRIOR>                          377,892
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                       249,967
<NET-ASSETS>                                 4,848,266
<DIVIDEND-INCOME>                               15,919
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                       0
<EXPENSES-NET>                                  38,726
<NET-INVESTMENT-INCOME>                       (22,807)
<REALIZED-GAINS-CURRENT>                         6,514
<APPREC-INCREASE-CURRENT>                      294,152
<NET-CHANGE-FROM-OPS>                          277,859
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        589,370
<NUMBER-OF-SHARES-REDEEMED>                     79,910
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       2,863,020
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 36,283
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 10
   <NAME> FM
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        8,395,157
<INVESTMENTS-AT-VALUE>                       8,395,157
<RECEIVABLES>                                   56,584
<ASSETS-OTHER>                                      59
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               8,451,800
<PAYABLE-FOR-SECURITIES>                        54,732
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                        9,695
<TOTAL-LIABILITIES>                             64,427
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        1,550,143
<SHARES-COMMON-PRIOR>                          749,809
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                             0
<NET-ASSETS>                                 8,387,373
<DIVIDEND-INCOME>                              339,310
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                       0
<EXPENSES-NET>                                 102,026
<NET-INVESTMENT-INCOME>                        237,284
<REALIZED-GAINS-CURRENT>                             0
<APPREC-INCREASE-CURRENT>                            0
<NET-CHANGE-FROM-OPS>                          237,284
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                      1,346,919
<NUMBER-OF-SHARES-REDEEMED>                    546,585
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       4,513,428
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                102,026
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 11
   <NAME> SU
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        9,015,628
<INVESTMENTS-AT-VALUE>                       9,263,160
<RECEIVABLES>                                   47,996
<ASSETS-OTHER>                                     170
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               9,311,326
<PAYABLE-FOR-SECURITIES>                        46,895
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       12,952
<TOTAL-LIABILITIES>                             59,847
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        1,712,387
<SHARES-COMMON-PRIOR>                          938,636
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                       247,532
<NET-ASSETS>                                 9,251,479
<DIVIDEND-INCOME>                              349,446
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                   2,208
<EXPENSES-NET>                                  70,358
<NET-INVESTMENT-INCOME>                        281,296
<REALIZED-GAINS-CURRENT>                      (29,579)
<APPREC-INCREASE-CURRENT>                      436,539
<NET-CHANGE-FROM-OPS>                          688,261
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        962,515
<NUMBER-OF-SHARES-REDEEMED>                    188,764
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       4,231,966
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 70,358
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 12
   <NAME> SV
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                       11,968,596
<INVESTMENTS-AT-VALUE>                      13,100,908
<RECEIVABLES>                                  144,892
<ASSETS-OTHER>                                   1,009
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                              13,246,809
<PAYABLE-FOR-SECURITIES>                       143,791
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       17,532
<TOTAL-LIABILITIES>                            161,323
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                        2,186,595
<SHARES-COMMON-PRIOR>                          962,628
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                     1,132,312
<NET-ASSETS>                                13,085,486
<DIVIDEND-INCOME>                              444,126
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                   4,077
<EXPENSES-NET>                                  88,613
<NET-INVESTMENT-INCOME>                        359,590
<REALIZED-GAINS-CURRENT>                        13,023
<APPREC-INCREASE-CURRENT>                    1,352,775
<NET-CHANGE-FROM-OPS>                        1,725,388
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                      7,366,412
<NUMBER-OF-SHARES-REDEEMED>                    142,445
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       8,532,524
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 88,613
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 13
   <NAME> AS
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        4,918,114
<INVESTMENTS-AT-VALUE>                       4,825,362
<RECEIVABLES>                                   34,274
<ASSETS-OTHER>                                       0
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               4,859,636
<PAYABLE-FOR-SECURITIES>                        34,286
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                       18,861
<TOTAL-LIABILITIES>                             53,147
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          734,300
<SHARES-COMMON-PRIOR>                                0
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                      (92,752)
<NET-ASSETS>                                 4,806,489
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                  19,725
<EXPENSES-NET>                                  14,826
<NET-INVESTMENT-INCOME>                          4,899
<REALIZED-GAINS-CURRENT>                        26,323
<APPREC-INCREASE-CURRENT>                     (92,752)
<NET-CHANGE-FROM-OPS>                         (61,480)
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        746,279
<NUMBER-OF-SHARES-REDEEMED>                     11,979
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       4,806,489
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 14,826
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 14
   <NAME> SI
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                          372,264
<INVESTMENTS-AT-VALUE>                         382,835
<RECEIVABLES>                                      331
<ASSETS-OTHER>                                      15
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                 383,181
<PAYABLE-FOR-SECURITIES>                           331
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                          402
<TOTAL-LIABILITIES>                                733
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                           65,505
<SHARES-COMMON-PRIOR>                                0
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                        10,571
<NET-ASSETS>                                   382,448
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                     349
<EXPENSES-NET>                                   1,349
<NET-INVESTMENT-INCOME>                        (1,000)
<REALIZED-GAINS-CURRENT>                           304
<APPREC-INCREASE-CURRENT>                       10,571
<NET-CHANGE-FROM-OPS>                            9,875
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                         66,110
<NUMBER-OF-SHARES-REDEEMED>                        605
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                         382,448
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                  1,349
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 15
   <NAME> FC
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                        5,787,530
<INVESTMENTS-AT-VALUE>                       5,879,966
<RECEIVABLES>                                   60,377
<ASSETS-OTHER>                                   8,845
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                               5,749,188
<PAYABLE-FOR-SECURITIES>                        68,064
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                        6,297
<TOTAL-LIABILITIES>                             74,361
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          933,682
<SHARES-COMMON-PRIOR>                                0
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                        92,436
<NET-ASSETS>                                 5,874,827
<DIVIDEND-INCOME>                               70,263
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                  30,772
<EXPENSES-NET>                                  18,477
<NET-INVESTMENT-INCOME>                         82,558
<REALIZED-GAINS-CURRENT>                        26,862
<APPREC-INCREASE-CURRENT>                       92,436
<NET-CHANGE-FROM-OPS>                          201,856
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        950,446
<NUMBER-OF-SHARES-REDEEMED>                     16,764
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                       5,672,971
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                 18,477
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
The accompanying notes are an integral part of these financial statements.
</LEGEND>
<SERIES>
   <NUMBER> 16
   <NAME> FE
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               DEC-31-1995
<INVESTMENTS-AT-COST>                          759,759
<INVESTMENTS-AT-VALUE>                         805,524
<RECEIVABLES>                                   17,300
<ASSETS-OTHER>                                       0
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                 822,824
<PAYABLE-FOR-SECURITIES>                        17,300
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                        1,004
<TOTAL-LIABILITIES>                             18,304
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                             0
<SHARES-COMMON-STOCK>                          131,121
<SHARES-COMMON-PRIOR>                                0
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                        45,765
<NET-ASSETS>                                   804,520
<DIVIDEND-INCOME>                                5,416
<INTEREST-INCOME>                                    0
<OTHER-INCOME>                                     490
<EXPENSES-NET>                                   2,303
<NET-INVESTMENT-INCOME>                          3,603
<REALIZED-GAINS-CURRENT>                           452
<APPREC-INCREASE-CURRENT>                       45,765
<NET-CHANGE-FROM-OPS>                           49,820
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                            0
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        132,235
<NUMBER-OF-SHARES-REDEEMED>                      1,114
<SHARES-REINVESTED>                                  0
<NET-CHANGE-IN-ASSETS>                         804,520
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                                  2,303
<AVERAGE-NET-ASSETS>                                 0
<PER-SHARE-NAV-BEGIN>                                0
<PER-SHARE-NII>                                      0
<PER-SHARE-GAIN-APPREC>                              0
<PER-SHARE-DIVIDEND>                                 0
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                                  0
<EXPENSE-RATIO>                                      0
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        

</TABLE>


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