<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 16 (File No. 33-4174) [x]
---------
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 18 (File No. 811-3500) [x]
---------
(Check appropriate box or boxes)
IDS LIFE OF NEW YORK ACCOUNT 4
IDS LIFE OF NEW YORK ACCOUNT 5
IDS LIFE OF NEW YORK ACCOUNT 6
IDS LIFE OF NEW YORK ACCOUNT 9
IDS LIFE OF NEW YORK ACCOUNT 10
IDS LIFE OF NEW YORK ACCOUNT 11
IDS LIFE OF NEW YORK ACCOUNT 12
IDS LIFE OF NEW YORK ACCOUNT 13
IDS LIFE OF NEW YORK ACCOUNT 14
- -------------------------------------------------------------------------------
(Exact Name of Registrant)
IDS Life Insurance Company of New York
- -------------------------------------------------------------------------------
(Name of Depositor)
20 Madison Avenue Extension, Albany, NY 12203
- -------------------------------------------------------------------------------
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 671-3678
- -------------------------------------------------------------------------------
Mary Ellyn Minenko, IDS Tower 10, Minneapolis, MN 55440-0010
- -------------------------------------------------------------------------------
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b)
[X] on April 30, 1999 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for
previously filed post-effective amendment.
<PAGE>
<PAGE>
PROSPECTUS
April 30, 1999
IDS LIFE OF NEW YORK FLEXIBLE ANNUITY
Individual flexible premium deferred combination fixed/variable annuity.
NEW FLEXIBLE ANNUITY CONTRACTS ARE NOT CURRENTLY BEING OFFERED.
IDS LIFE OF NEW YORK ACCOUNTS 4, 5, 6, 9, 10, 11, 12, 13 AND 14
Issued by: IDS Life Insurance Company of New York
20 Madison Ave. Extension
Albany, NY 12203
Telephone: 800-541-2251
This prospectus contains information that you should know before investing. You
also will receive the IDS Life Retirement Annuity Mutual Funds prospectus.
Please read the prospectuses carefully and keep them for future reference. The
contract is available for qualified and nonqualified retirement plans.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR PASSED UPON THE ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
AN INVESTMENT IN THIS ANNUITY IS NOT A DEPOSIT OF A BANK OR FINANCIAL
INSTITUTION AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN THIS ANNUITY
INVOLVES INVESTMENT RISK INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
A Statement of Additional Information (SAI), dated the same date as this
prospectus, is incorporated by reference into this prospectus. It is filed with
the Securities and Exchange Commission (SEC), and is available without charge by
contacting IDS Life of New York at the telephone number above or by completing
and sending the order form on the last page of this prospectus. The table of
contents of the SAI is on page 48 of this prospectus.
<PAGE>
TABLE OF CONTENTS
KEY TERMS 3
THE CONTRACT IN BRIEF 5
EXPENSE SUMMARY 7
CONDENSED FINANCIAL INFORMATION (UNAUDITED) 9
FINANCIAL STATEMENTS 12
PERFORMANCE INFORMATION 12
THE VARIABLE ACCOUNTS 14
THE FUNDS 16
THE FIXED ACCOUNT 18
BUYING YOUR CONTRACT 19
CHARGES 23
VALUING YOUR INVESTMENT 26
MAKING THE MOST OF YOUR CONTRACT 28
SURRENDERS 31
TSA-SPECIAL SURRENDER PROVISIONS 32
CHANGING OWNERSHIP 33
BENEFITS IN CASE OF DEATH 34
THE ANNUITY PAYOUT PERIOD 36
TAXES 39
VOTING RIGHTS 44
ABOUT THE SERVICE PROVIDERS 45
YEAR 2000 47
TABLE OF CONTENTS OF THE STATEMENT OF
ADDITIONAL INFORMATION 48
2
<PAGE>
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KEY TERMS
THESE TERMS CAN HELP YOU UNDERSTAND DETAILS ABOUT YOUR
CONTRACT.
ACCUMULATION UNIT -- A measure of the value of each variable account before
annuity payouts begin.
ANNUITANT -- The person on whose life or life expectancy the annuity payouts are
based.
ANNUITY PAYOUTS -- An amount paid at regular intervals under one of several
plans.
BENEFICIARY -- The person you designate to receive annuity benefits in case of
the owner's or annuitant's death while the contract is in force and before
annuity payouts begin.
CLOSE OF BUSINESS -- When the New York Stock Exchange (NYSE) closes, normally 4
p.m. Eastern time.
CONTRACT VALUE -- The total value of your contract before we deduct any
applicable charges.
CONTRACT YEAR -- A period of 12 months, starting on the effective date of your
contract and on each anniversary of the effective date.
FIXED ACCOUNT -- An account to which you may allocate purchase payments. Amounts
you allocate to this account earn interest at rates that we declare
periodically.
FUNDS -- Mutual funds and/or portfolios that are investment options under your
contract, each with a different investment objective. You may allocate your
purchase payments into variable accounts investing in shares of any or all of
these funds.
OWNER (YOU, YOUR) -- The person who controls the contract (decides on investment
allocations, transfers, payout options, etc.). Usually, but not always, the
owner is also the annuitant. The owner is responsible for taxes, regardless of
whether he or she receives the contract's benefits.
3
<PAGE>
KEY TERMS
QUALIFIED ANNUITY -- A contract that you purchase for one of the following
retirement plans that is subject to applicable federal law and any rules of the
plan itself:
- -Individual Retirement Annuities (IRAs)
- -Roth IRAs
- -Simplified Employee Pension (SEP) plans
- -Section 401(k) plans
- -Custodial and trusteed pension and profit sharing plans
- -Tax Sheltered Annuities (TSAs)
- -Section 457 plans.
All other contracts are considered
NONQUALIFIED ANNUITIES.
RETIREMENT DATE -- The date when annuity payouts are scheduled to begin.
SURRENDER VALUE -- The amount you are entitled to receive if you make a full
surrender from your contract. It is the contract value minus any applicable
charges.
VALUATION DATE -- Any normal business day, Monday through Friday, that the NYSE
is open. Each valuation date ends at the close of business. We calculate the
value of each variable account at the close of business on each valuation date.
VARIABLE ACCOUNTS -- Separate accounts to which you may allocate purchase
payments; each invests in shares of one fund. The value of your investment in
each variable account changes with the performance of the particular fund.
4
<PAGE>
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THE CONTRACT IN BRIEF
PURPOSE: The purpose of the contract is to allow you to
accumulate money for retirement. You do this by making
one or more investments (purchase payments) that may
earn returns that increase the value of the contract.
The contract provides lifetime or other forms of
payouts beginning at a specified date (the retirement
date). As in the case of other annuities, it may not be
advantageous for you to purchase this contract as a
replacement for, or in addition to an existing annuity.
FREE LOOK PERIOD: You may return your contract to your financial
advisor or to our office within 10 days after it is
delivered to you and receive a full refund of all your
purchase payments.
ACCOUNTS: Currently, you may allocate your purchase payments
among any or all of:
- the variable accounts, each of which invests in a
fund with a particular investment objective. The value
of each variable account varies with the performance
of the particular fund in which it invests. We cannot
guarantee that the value at the retirement date will
equal or exceed the total purchase payments you
allocate to the variable accounts. (p. 14)
- the fixed account, which earns interest at a rate
that we adjust periodically. (p. 18)
BUYING YOUR CONTRACT: We no longer offer new contracts. You have the
option of making additional purchase payments to your
contract.
- Minimum purchase payment -- $2,000 ($1,000 for
qualified annuities) unless you pay in installments by
means of a bank authorization or under a group billing
arrangement such as a payroll deduction.
- Minimum installment purchase payment -- $50 monthly;
$23.08 biweekly payroll deductions.
- Maximum purchase payment for each subsequent year --
$50,000 (p. 21)
TRANSFERS: Subject to certain restrictions, you currently may
redistribute your money among accounts without charge
at any time until annuity payouts begin, and once per
contract year among the variable accounts after annuity
payouts begin. You may establish automated transfers
among the fixed and variable accounts. Fixed account
transfers are subject to special restrictions. (p. 29)
5
<PAGE>
THE CONTRACT IN BRIEF
SURRENDERS: You may surrender all or part of your contract value
at any time before the retirement date. You also may
establish automated partial surrenders. Surrenders may
be subject to charges and tax penalties (including a
10% IRS penalty if you surrender prior to your reaching
age 59 1/2) and may have other tax consequences; also,
certain restrictions apply. (p. 31)
CHANGING OWNERSHIP: You may change ownership of a nonqualified annuity
by written instruction, but this may have federal
income tax consequences. Restrictions apply to changing
ownership of a qualified annuity. (p. 33)
BENEFITS IN CASE OF DEATH:
If you or the annuitant die before annuity payouts
begin, we will pay the beneficiary an amount at least
equal to the contract value. (p. 34)
ANNUITY PAYOUTS: You can apply your contract value to an annuity
payout plan that begins on the retirement date. You may
choose from a variety of plans to make sure that
payouts continue as long as you like. If you purchased
a qualified annuity, the payout schedule must meet
requirements of the qualified plan. We can make payouts
on a fixed or variable basis, or both. Total monthly
payouts may include amounts from each variable account
and the fixed account. During the annuity payout
period, you cannot be invested in more than five
variable accounts at any one time unless we agree
otherwise. (p. 36)
TAXES: Generally, your contract grows tax-deferred until you
surrender it or begin to receive payouts. (Under
certain circumstances, IRS penalty taxes may apply.)
Even if you direct payouts to someone else, you will be
taxed on the income if you are the owner. Roth IRAs
however, may grow and be distributed tax-free, if you
meet certain distribution requirements. (p. 39)
CHARGES:
- $6 quarterly ($24 annual) contract
administrative charge;
- 1.00% mortality and expense risk fee;
- surrender charge; and
- the operating expenses of the funds.
6
<PAGE>
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EXPENSE SUMMARY
The purpose of this table is to help you understand the various costs and
expenses associated with your contract.
You pay no sales charge when you purchase your contract. We show all costs that
you bear directly or indirectly for the variable accounts and funds below. Some
expenses may vary as we explain under "Charges."
ANNUAL CONTRACT OWNER EXPENSES:
<TABLE>
<CAPTION>
SURRENDER CHARGE
(contingent deferred sales charge as a
percentage of new purchase payments
surrendered)
<S> <C>
Purchase payments up to
six years old 7%
Earnings and purchase payments
six years old or more 0%
ANNUAL CONTRACT ADMINISTRATIVE
CHARGE $ 24
</TABLE>
ANNUAL VARIABLE ACCOUNT EXPENSES
(as a percentage of average daily net assets of the variable
accounts):
<TABLE>
<CAPTION>
MORTALITY AND EXPENSE RISK FEE: 1%
<S> <C>
</TABLE>
ANNUAL OPERATING EXPENSES OF THE FUNDS
(as a percentage of average daily net assets):
<TABLE>
<CAPTION>
IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS
AGGRESSIVE CAPITAL GLOBAL GROWTH INCOME INTERNATIONAL LIFE IDS LIFE
GROWTH RESOURCE YIELD DIMENSIONS ADVANTAGE EQUITY MANAGED MONEYSHARE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management fees .59% .59% .83% .61% .62% .83% .59% .50%
Other expenses .09 .07 .13 .06 .09 .15 .04 .06
Total(1) .68% .66% .96% .67% .71% .98% .63% .56%
<CAPTION>
IDS LIFE
SPECIAL
INCOME
<S> <C>
Management fees .60%
Other expenses .07
Total(1) .67%
</TABLE>
(1) Annualized operating expenses of underlying funds at Dec. 31, 1998.
7
<PAGE>
EXPENSE SUMMARY
<TABLE>
<CAPTION>
EXAMPLE:* IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS LIFE IDS LIFE
AGGRESSIVE CAPITAL GLOBAL GROWTH INCOME INTERNATIONAL IDS LIFE IDS LIFE SPECIAL
GROWTH RESOURCE YIELD DIMENSIONS ADVANTAGE EQUITY MANAGED MONEYSHARE INCOME
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment, assuming a 5% annual return and full surrender at the end of each
time period:
1 Year $ 87.88 $ 87.67 $ 90.75 $ 87.77 $ 88.18 $ 90.95 $ 87.36 $ 86.65 $ 87.77
3 Years 125.37 124.75 134.08 125.06 126.30 134.70 123.81 121.62 125.06
5 Years 165.31 164.26 179.98 164.78 166.89 181.02 162.67 158.97 164.78
10 Years 206.94 204.76 237.01 205.85 210.21 239.13 201.49 193.80 205.85
You would pay the following expenses on the same investment assuming no surrender or selection of an annuity payout plan at the
end of each time period:
1 Year $ 17.88 $ 17.67 $ 20.75 $ 17.77 $ 18.18 $ 20.95 $ 17.36 $ 16.65 $ 17.77
3 Years 55.37 54.75 64.08 55.06 56.30 64.70 53.81 51.62 55.06
5 Years 95.31 94.26 109.98 94.78 96.89 111.02 92.67 88.97 94.78
10 Years 206.94 204.76 237.01 205.85 210.21 239.13 201.49 193.80 205.85
</TABLE>
* In this example, the $24 contract administrative charge is approximated as a
0.064% charge based on our average contract size.
YOU SHOULD NOT CONSIDER THIS EXAMPLE AS A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.
8
<PAGE>
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CONDENSED FINANCIAL INFORMATION (UNAUDITED)
The following tables give per-unit information about the financial history of
each account.
<TABLE>
<CAPTION>
YEAR ENDED DEC. 31,
1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ACCOUNT 11(1) (INVESTING IN SHARES OF IDS LIFE AGGRESSIVE GROWTH FUND)
Accumulation $1.88 $1.69 $1.47 $1.12 $1.21 $1.08 $1.00 -- -- --
unit value at
beginning of
period
Accumulation $1.91 $1.88 $1.69 $1.47 $1.12 $1.21 $1.08 -- -- --
unit value at
end of period
Number of 73,610 79,813 77,673 62,233 45,347 19,430 5,961 -- -- --
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% -- -- --
operating
expense to
average net
assets
ACCOUNT 4 (INVESTING IN SHARES OF IDS LIFE CAPITAL RESOURCE FUND)
Accumulation $5.71 $4.64 $4.35 $3.43 $3.43 $3.35 $3.25 $2.24 $2.25 $1.78
unit value at
beginning of
period
Accumulation $7.02 $5.71 $4.64 $4.35 $3.43 $3.43 $3.35 $3.25 $2.24 $2.25
unit value at
end of period
Number of 37,947 41,666 47,283 44,849 38,283 30,089 21,677 13,591 10,058 8,345
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
operating
expense to
average
ACCOUNT 12(2) (INVESTING IN SHARES OF IDS LIFE GLOBAL YIELD FUND)
Accumulation $1.10 $1.07 $1.00 -- -- -- -- -- -- --
unit value at
beginning of
period
Accumulation $1.18 $1.10 $1.07 -- -- -- -- -- -- --
unit value at
end of period
Number of 6,220 5,578 2,311 -- -- -- -- -- -- --
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% -- -- -- -- -- -- --
operating
expense to
average net
assets
</TABLE>
9
<PAGE>
CONDENSED FINANCIAL INFORMATION (UNAUDITED)
<TABLE>
<CAPTION>
YEAR ENDED DEC. 31,
1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ACCOUNT 14(2) (INVESTING IN SHARES OF IDS LIFE GROWTH DIMENSIONS FUND)
Accumulation $1.37 $1.11 $1.00 -- -- -- -- -- -- --
unit value at
beginning of
period
Accumulation $1.74 $1.37 $1.11 -- -- -- -- -- -- --
unit value at
end of period
Number of 75,581 64,613 27,817 -- -- -- -- -- -- --
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% -- -- -- -- -- -- --
operating
expense to
average net
assets
ACCOUNT 13(2) (INVESTING IN SHARES OF IDS LIFE INCOME ADVANTAGE FUND)
Accumulation $1.18 $1.05 $1.00 -- -- -- -- -- -- --
unit value at
beginning of
period
Accumulation $1.12 $1.18 $1.05 -- -- -- -- -- -- --
unit value at
end of period
Number of 17,820 12,894 4,671 -- -- -- -- -- -- --
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% -- -- -- -- -- -- --
operating
expense to
average net
assets
ACCOUNT 10(1) (INVESTING IN SHARES OF IDS LIFE INTERNATIONAL EQUITY FUND)
Accumulation $1.52 $1.50 $1.38 $1.25 $1.29 $0.98 $1.00 -- -- --
unit value at
beginning of
period
Accumulation $1.74 $1.52 $1.50 $1.38 $1.25 $1.29 $0.98 -- -- --
unit value at
end of period
Number of 67,198 75,831 77,830 63,576 51,480 21,650 3,421 -- -- --
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% -- -- --
operating
expense to
average net
assets
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
YEAR ENDED DEC. 31,
1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ACCOUNT 9 (INVESTING IN SHARES OF IDS LIFE MANAGED FUND)
Accumulation $3.51 $2.96 $2.57 $2.09 $2.21 $1.98 $1.86 $1.45 $1.42 $1.14
unit value at
beginning of
period
Accumulation $4.03 $3.51 $2.96 $2.57 $2.09 $2.21 $1.98 $1.86 $1.45 $1.42
unit value at
end of period
Number of 67,428 73,557 75,219 72,999 66,800 50,761 31,828 20,105 15,292 12,248
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
operating
units
outstanding at
end of period
(000 omitted)
ACCOUNT 6 (INVESTING IN SHARES OF IDS LIFE MONEYSHARE FUND)
Accumulation $2.17 $2.07 $1.99 $1.91 $1.86 $1.83 $1.80 $1.71 $1.61 $1.49
unit value at
beginning of
period
Accumulation $2.26 $2.17 $2.07 $1.99 $1.91 $1.86 $1.83 $1.80 $1.71 $1.61
unit value at
end of period
Number of 6,515 4,651 5,927 5,445 3,794 4,113 5,378 7,253 6,487 5,493
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
operating
expense to
average net
assets
Simple 3.73% 4.16% 3.85% 4.11% 4.41% 1.90% 1.77% 3.24% 6.20% 6.80%
yield(3)
Compound 3.80% 4.25% 3.93% 4.20% 4.51% 1.92% 1.79% 3.29% 6.39% 7.03%
yield(3)
ACCOUNT 5 (INVESTING IN SHARES OF IDS LIFE SPECIAL INCOME FUND)
Accumulation $4.01 $3.73 $3.53 $2.91 $3.06 $2.67 $2.46 $2.12 $2.05 $1.90
unit value at
beginning of
period
Accumulation $4.03 $4.01 $3.73 $3.53 $2.91 $3.06 $2.67 $2.46 $2.12 $2.05
unit value at
end of period
Number of 20,262 21,882 24,424 23,903 21,936 23,259 16,710 12,228 10,315 9,301
accumulation
units
outstanding at
end of period
(000 omitted)
Ratio of 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
operating
expense to
average net
assets
</TABLE>
(1) Accounts 10 and 11 commenced operations on Jan. 13, 1992.
(2) Accounts 12, 13 and 14 commenced operations on April 30, 1996.
(3) Net of annual contract administrative charge and mortality and expense risk
fee.
11
<PAGE>
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FINANCIAL STATEMENTS
You can find our audited financial statements and the audited financial
statements of the variable accounts in the SAI.
PERFORMANCE INFORMATION
- ---------------------------------------------------------------------------
Performance information for the variable accounts may appear from time to time
in advertisements or sales literature. This information reflects the performance
of a hypothetical investment in a particular variable account during a specified
time period. Although we base performance figures on historical earnings, past
performance does not guarantee future results.
We include non-recurring charges (such as surrender charges) in total return
figures, but not in yield quotations. Excluding non-recurring charges in yield
calculations increases the reported value.
Total return figures reflect deduction of all applicable charges, including:
- -the contract administrative charge,
- -mortality and expense risk fee, and
- -surrender charge (assuming a surrender at the end of the illustrated period).
We also may make optional total return quotations that do not reflect a
surrender charge deduction (assuming no surrender). Total return quotations may
be shown by means of schedules, charts or graphs.
AVERAGE ANNUAL TOTAL RETURN is the average annual compounded rate of return of
the investment over a period of one, five and 10 years (or up to the life of the
variable account if it is less than ten years old).
CUMULATIVE TOTAL RETURN is the cumulative change in the value of an investment
over a specified time period. We assume that income earned by the investment is
reinvested. Cumulative total return will be higher than average annual total
return because it is not averaged.
12
<PAGE>
ANNUALIZED SIMPLE YIELD (FOR VARIABLE ACCOUNTS INVESTING IN MONEY MARKET FUNDS)
"annualizes" the income generated by the investment over a given seven-day
period. That is, we assume the amount of income generated by the investment
during the period will be generated each seven-day period for a year. We show
this as a percentage of the investment.
ANNUALIZED COMPOUND YIELD (FOR VARIABLE ACCOUNTS INVESTING IN MONEY MARKET
FUNDS) is calculated like simple yield except that we assume the income is
reinvested when we annualize it. Compound yield will be higher than the simple
yield because of the compounding effect of the assumed reinvestment.
ANNUALIZED YIELD (FOR VARIABLE ACCOUNTS INVESTING IN INCOME FUNDS) divides the
net investment income (income less expenses) for each accumulation unit during a
given 30 day period by the value of the unit on the last day of the period. We
then convert the result to an annual percentage.
You should consider performance information in light of the investment
objectives, policies, characteristics and quality of the fund in which the
variable account invests and the market conditions during the specified time
period. Advertised yields and total return figures include charges that reduce
advertised performance. Therefore, you should not compare variable account
performance to that of mutual funds that sell their shares directly to the
public. (See the SAI for a further description of methods used to determine
total return and yield.)
If you would like additional information about actual performance, please
contact your financial advisor.
13
<PAGE>
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THE VARIABLE ACCOUNTS
You may allocate payments to any or all the variable accounts that invest in
shares of the following funds:
<TABLE>
<CAPTION>
FUNDS OFFERED THROUGH IDS LIFE OF
VARIABLE ACCOUNTS NEW YORK ACCOUNT ESTABLISHED
<S> <C> <C>
IDS Life Aggressive Growth Fund 11 Oct. 8, 1991
IDS Life Capital Resource Fund 4 Nov. 12, 1981
IDS Life Global Yield Fund 12 April 17, 1996
IDS Life Growth Dimensions Fund 14 April 17, 1996
IDS Life Income Advantage Fund 13 April 17, 1996
IDS Life International Equity Fund 10 Oct. 8, 1991
IDS Life Managed Fund 9 Feb. 12, 1986
IDS Life Moneyshare Fund 6 Nov. 12, 1981
IDS Life Special Income Fund 5 Nov. 12, 1981
</TABLE>
Each variable account meets the definition of a separate account under federal
securities laws. We credit or charge income, capital gains and capital losses of
each variable account only to that variable account. State insurance law
prohibits us from charging a variable account with liabilities of any other
variable account or of our general business. Each variable account's net assets
are held in relation to the contracts described in this prospectus as well as
other contracts that we issue that are not described in this prospectus.
The U.S. Treasury and the Internal Revenue Service (IRS) indicated that they may
provide additional guidance on investment control. This concerns how many
variable accounts an insurance company may offer and how many exchanges among
variable accounts it may allow before the contract owner would be currently
taxed on income earned within variable account assets. At this time, we do not
know what the additional guidance will be or when action will be taken. We
reserve the right to modify the contract, as necessary, to ensure that the owner
will not be subject to current taxation as the owner of the variable account
assets.
We intend to comply with all federal tax laws to ensure that the contract
continues to qualify as an annuity for federal income tax purposes. We reserve
the right to modify the contract as necessary to comply with any new tax laws.
All variable accounts were established under New York law and are registered
together as a single unit
14
<PAGE>
investment trust under the Investment Company Act of 1940 (the 1940 Act). This
registration does not involve and supervision of our management or investment
practices and policies by the SEC. All obligations arising under the contracts
are general obligations of IDS Life of New York.
15
<PAGE>
- ----------------------------------
THE FUNDS
IDS LIFE AGGRESSIVE GROWTH FUND
Objective: capital appreciation. Invests primarily in common stocks of small-
and medium-size companies.
IDS LIFE CAPITAL RESOURCE FUND
Objective: capital appreciation. Invests primarily in U.S. common stocks.
IDS LIFE GLOBAL YIELD FUND
Objective: high total return through income and growth of capital. Invests
primarily in debt securities of U.S. and foreign issuers.
IDS LIFE GROWTH DIMENSIONS FUND
Objective: long-term growth of capital. Invests primarily in common stocks of
U.S. and foreign companies showing potential for significant growth.
IDS LIFE INCOME ADVANTAGE FUND
Objective: high current income, with capital growth as a secondary objective.
Invests primarily in long-term, high-yielding, high-risk debt securities below
investment grade issued by U.S. and foreign corporations.
IDS LIFE INTERNATIONAL EQUITY FUND
Objective: capital appreciation. Invests primarily in common stock of foreign
issuers.
IDS LIFE MANAGED FUND
Objective: maximum total investment return through a combination of capital
growth and current income. Invests primarily in stocks, convertible securities,
bonds and money market instruments.
IDS LIFE MONEYSHARE FUND
Objective: maximum current income consistent with liquidity and conservation of
capital. Invests in money market securities.
IDS LIFE SPECIAL INCOME FUND
Objective: to provide a high level of current income while conserving the value
of the investment for the longest time period. Invests primarily in
investment-grade bonds.
16
<PAGE>
The investment objectives and policies of some of the funds are similar to the
investment objectives and policies of other mutual funds that the investment
advisor or its affiliates manage. Although the objectives and policies may be
similar, each fund will have its own portfolio holdings and its own fees and
expenses. Accordingly, each fund will have its own investment results.
The IRS issued final regulations relating to the diversification requirements
under Section 817(h) of the Internal Revenue Code of 1986, as amended (the
Code). Each mutual fund intends to comply with these requirements.
IDS Life is the investment manager and AEFC is the investment advisor for each
of the funds. American Express Asset Management International Inc., a wholly
owned subsidiary of AEFC, is the sub-investment advisor for IDS Life
International Equity Fund. The investment manager and advisor cannot guarantee
that the funds will meet their investment objectives. Please read the funds'
prospectus for facts you should know before investing. This prospectus is
available by contacting us at the address or telephone number on the first page
of this prospectus, or from your financial advisor.
17
<PAGE>
- ----------------------------------
THE FIXED ACCOUNT
You also may allocate purchase payments to the fixed account. We back the
principal and interest guarantees relating to the fixed account. The value of
the fixed account increases as we credit interest to the account. Purchase
payments and transfers to the fixed account become part of our general account.
We credit interest daily and compound it annually. We will change the interest
rates from time to time at our discretion.
Interests in the fixed account are not required to be registered with the SEC.
The SEC staff does not review the disclosures in this prospectus on the fixed
account. Disclosures regarding the fixed account, however, may be subject to
certain generally applicable provisions of the federal securities laws relating
to the accuracy and completeness of statements made in prospectuses. (See
"Making the Most of Your Contract -- Transfer policies" for restrictions on
transfers involving the fixed account.)
18
<PAGE>
- ----------------------------------
BUYING YOUR CONTRACT
New contracts are not currently being offered.
As the owner, you have all rights and may receive all benefits under the
contract. You can own a nonqualified annuity in joint tenancy with rights of
survivorship only in spousal situations. You cannot own a qualified annuity in
joint tenancy. We will credit additional purchase payments to your accounts at
the next close of business after we receive your payments at our office.
When you apply, you may select:
- -the accounts in which you want to invest;
- -how you want to make purchase payments; and
- -a beneficiary.
If your application is complete, we will process it and apply your purchase
payment to the accounts you selected within two business days after we receive
it at our office. If we accept your application, we will send you a contract. If
we cannot accept your application within five business days, we will decline it
and return your payment. We will credit additional purchase payments you make to
your accounts on the valuation date we receive them. We will value the
additional payments at the next accumulation unit value calculated after we
receive your payments at our office.
THE RETIREMENT DATE
Annuity payouts are scheduled to begin on the retirement date. When we process
your application, we will establish the retirement date to the maximum age or
date described below. You also can change the date, provided you send us written
instructions at least 30 days before annuity payouts begin.
FOR NONQUALIFIED ANNUITIES AND ROTH IRAS, the retirement date must be:
- -no earlier than the 60th day after the contract's effective date; and
- -no later than the annuitant's 85th birthday or before the 10th contract
anniversary, if purchased after age 75.
19
<PAGE>
BUYING YOUR CONTRACT
FOR QUALIFIED ANNUITIES EXCEPT ROTH IRAS, to avoid IRS penalty taxes, the
retirement date generally must be:
- -on or after the date the annuitant reaches age 59 1/2; and
- -for IRAs and SEPs, by April 1 of the year following the calendar year when the
annuitant reaches age 70 1/2; and
- -for all other qualified annuities: by April 1 of the year following the
calendar year when the annuitant reaches age 70 1/2 or, if later, retires
(except that 5% business owners may not select a retirement date that is later
than April 1 of the year following the calendar year when they reach age
70 1/2).
If you take the minimum IRA or TSA distributions as required by the Code from
another tax-qualified investment or in the form of partial surrenders from this
contract, annuity payouts can start as late as the annuitant's 85th birthday or
the 10th contract anniversary.
BENEFICIARY
If death benefits become payable before the retirement date (while this contract
is in force and before annuity payouts begin), we will pay your named
beneficiary all or part of the contract value. If there is no named beneficiary,
then you or your estate will be the beneficiary. (See "Benefits in case of
death" for more about beneficiaries.)
20
<PAGE>
PURCHASE PAYMENT AMOUNTS
MINIMUM PURCHASE PAYMENT
IF SINGLE PURCHASE PAYMENT:
<TABLE>
<S> <C>
Nonqualified: $2,000
Qualified: $1,000
</TABLE>
IF INSTALLMENT PURCHASE PAYMENTS:
- -Minimum installment purchase payments: $50 monthly; $23.08 biweekly (scheduled
payment plan billing)
Installments must total at least $600 in the first year.*
* If you do not make any purchase payments for 36 months and your previous
payments total $600 or less, we have the right to give you 30 days' written
notice and pay you the total value of your annuity in a lump sum.
- -MINIMUM ADDITIONAL PURCHASE PAYMENTS: $50
MAXIMUM FIRST-YEAR PURCHASE PAYMENTS:
This maximum is based on your age or age of the annuitant (whoever is older) on
the effective date of the contract.
<TABLE>
<S> <C>
Up to age
75 $1 million
76 to 85 $ 500,000
86 to 90 $ 50,000
</TABLE>
- -MAXIMUM PURCHASE PAYMENT FOR EACH SUBSEQUENT YEAR**: $50,000
** These limits apply in total to all IDS Life of New York annuities you own. We
reserve the right to increase maximum limits or reduce age limits. For
qualified annuities the qualified plan's limits on annual contributions also
apply.
21
<PAGE>
BUYING YOUR CONTRACT
HOW TO MAKE PURCHASE PAYMENTS
<TABLE>
<S> <C>
- --------------------------------------------------------------
Send your check along with your name and account
1 number to:
BY LETTER
REGULAR MAIL:
IDS Life Insurance Company of New York
Box 5144
Albany, NY 12205
EXPRESS MAIL:
IDS Life Insurance Company of New York
20 Madison Ave. Extension
Albany, NY 12203
- --------------------------------------------------------------
Your financial advisor can help you set up:
2 - an automatic payroll deduction, salary
BY SCHEDULED reduction, or other group billing arrangement;
PAYMENT PLAN or
- a bank authorization.
</TABLE>
22
<PAGE>
- ----------------------------------
CHARGES
CONTRACT ADMINISTRATIVE CHARGE
We charge this fee for establishing and maintaining your records. We deduct $6
from the contract value at the end of each contract quarter (each three-month
period measured from the effective date of your contract). This equates to an
annual charge of $24. We prorate this charge among the variable accounts and the
fixed account in the same proportion your interest in each account bears to your
total contract value. If you surrender your contract, we will deduct the
quarterly charge at the time of surrender. We cannot increase the quarterly
contract administrative charge and it does not apply after annuity payouts begin
or when we pay death benefits.
MORTALITY AND EXPENSE RISK FEE
This fee is to cover the mortality risk and expense risk. We charge this fee
daily to your variable accounts. The unit values of your variable accounts
reflect this fee and it totals 1% of the variable accounts' average daily net
assets on an annual basis. Approximately two-thirds of this amount is for our
assumption of mortality risk, and one-third is for our assumption of expense
risk. This fee does not apply to the fixed account.
Mortality risk arises because of our guarantee to pay a death benefit and our
guarantee to make annuity payouts according to the terms of the contract, no
matter how long a specific annuitant lives and no matter how long our entire
group of annuitants live. If, as a group, annuitants outlive the life expectancy
we assumed in our actuarial tables, then we must take money from our general
assets to meet our obligations. If, as a group, annuitants do not live as long
as expected, we could profit from the mortality risk fee.
Expense risk arises because we cannot increase the contract administrative
charge and this charge may not cover our expenses. We would have to make up any
deficit from our general assets.
The variable accounts pay us the mortality and expense risk fee they accrued as
follows:
- -first, to the extent possible, the variable accounts pay this fee from any
dividends distributed from the funds in which they invest;
- -then, if necessary, the funds redeem shares to cover any remaining fees
payable.
23
<PAGE>
CHARGES
We may use any profits we realize from the variable accounts' payment to us of
the mortality and expense risk fee for any proper corporate purpose, including,
among others, payment of distribution (selling) expenses. We do not expect that
the surrender charge, discussed in the following paragraphs, will cover sales
and distribution expenses.
SURRENDER CHARGE
A surrender charge of 7% applies on each purchase payment you make. We may
deduct this surrender charge if you request a surrender within six years of
making that purchase payment. We calculate the surrender charge by drawing from
your total contract value in the following order:
- -First we surrender any contract earnings (contract value minus all purchase
payments received and not previously surrendered). There is no surrender charge
on contract earnings.
NOTE: We determine contract earnings by looking at the entire contract value,
not the earnings of any particular variable or the fixed account.
- -Next, if necessary, we surrender amounts representing purchase payments six
contract years old or more and not previously surrendered. There is no
surrender charge on these old purchase payments.
- -Finally, if necessary, we surrender amounts representing purchase payments up
to six contract years old and not previously surrendered on a "first-in,
first-out" (FIFO) basis. A surrender charge of 7% applies to any amount
surrendered from these new purchase payments.
For a partial surrender that is subject to a surrender charge, the amount we
actually surrender from your contract will be the amount you request plus any
applicable surrender charge. We apply the surrender charge to this total amount.
We pay you the amount you requested.
24
<PAGE>
EXAMPLE OF SURRENDER CHARGE ON NEW PURCHASE PAYMENTS
You request:
<TABLE>
<S> <C>
1,000 partial surrender = $1,075.27
.93
Total amount surrendered......... $1,075.27
X 0.07
---------
Total surrender charge........... $ 75.27
</TABLE>
There are no surrender charges for:
- -amounts surrendered after the later of the annuitant attaining age 65 or the
10th contract anniversary;
- -contracts settled using an annuity payout plan; and
- -death benefits.
OTHER INFORMATION ON CHARGES: AEFC makes certain custodial services available to
some custodial and trusteed pension and profit sharing plans and 401(k) plans
funded by our annuities. Fees for these services start at $30 per calendar year
per participant. AEFC will charge a termination fee for owners under 59 1/2 (fee
waived in case of death or disability).
POSSIBLE GROUP REDUCTIONS: In some cases (for example, an employer making the
contract available to employees) we may incur lower sales and administrative
expenses due to the size of the group, the average contribution and the use of
group enrollment procedures. In such cases, we may be able to reduce or
eliminate the contract administrative and surrender charges. However, we expect
this to occur infrequently.
25
<PAGE>
- ----------------------------------
VALUING YOUR INVESTMENT
We value your accounts as follows:
FIXED ACCOUNT: We value the amounts allocated to the fixed account directly in
dollars. The fixed account value equals:
- -the sum of your purchase payments and transfer amounts allocated to the fixed
account;
- -plus interest credited;
- -minus the sum of amounts surrendered (including any applicable surrender
charges) and amounts transferred out; and
- -minus any prorated contract administrative charge.
VARIABLE ACCOUNTS: We convert amounts you allocated to the variable accounts
into accumulation units. Each time you make a purchase payment or transfer
amounts into one of the variable accounts, we credit a certain number of
accumulation units to your contract for that account. Conversely, each time you
take a partial surrender, transfer amounts out of a variable account or we
assess a contract administrative charge, we subtract a certain number of
accumulation units from your contract.
The accumulation units are the true measure of investment value in each account
during the accumulation period. They are related to, but not the same as, the
net asset value of the fund in which the account invests.
The dollar value of each accumulation unit can rise or fall daily depending on
the variable account expenses, performance of the fund and on certain fund
expenses. Here is how we calculate accumulation unit values:
NUMBER OF UNITS
To calculate the number of accumulation units for a particular account, we
divide your investment by the current accumulation unit value.
ACCUMULATION UNIT VALUE
The current accumulation unit value for each variable account equals the last
value times the account's current net investment factor.
26
<PAGE>
NET INVESTMENT FACTOR
We determine the net investment factor by:
- -adding the fund's current net asset value per share, plus the per share amount
of any accrued income or capital gain dividends to obtain a current adjusted
net asset value per share; then
- -dividing that sum by the previous adjusted net asset value per share; and
- -subtracting the percentage factor representing the mortality and expense risk
fee from the result.
Because the net asset value of the fund may fluctuate, the accumulation unit
value may increase or decrease. You bear all the investment risk in a variable
account.
FACTORS THAT AFFECT VARIABLE ACCOUNT ACCUMULATION UNITS
Accumulation units may change in two ways: in number and in value. Here are the
factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
- -additional purchase payments you allocate to the variable accounts;
- -transfers into or out of the variable accounts;
- -partial surrenders;
- -surrender charges; and/or
- -prorated portions of the contract administrative charge.
Accumulation unit values will fluctuate due to:
- -changes in funds' net asset value;
- -dividends distributed to the variable accounts;
- -capital gains or losses of funds;
- -fund operating expenses; and/or
- -mortality and expense risk fees.
27
<PAGE>
- ----------------------------------
MAKING THE MOST OF YOUR CONTRACT
AUTOMATED DOLLAR-COST AVERAGING
Currently, you can use automated transfers to take advantage of dollar-cost
averaging (investing a fixed amount at regular intervals). For example, you
might have a set amount transferred monthly from a relatively conservative
variable account to a more aggressive one, or to several others, or from the
fixed account to one or more variable accounts. There is no charge for
dollar-cost averaging.
This systematic approach can help you benefit from fluctuations in accumulation
unit values caused by fluctuations in the market values of the funds. Since you
invest the same amount each period, you automatically acquire more units when
the market value falls and fewer units when it rises. The potential effect is to
<TABLE>
<CAPTION>
lower your average cost per unit.
<S> <C> <C> <C>
HOW DOLLAR-COST AVERAGING WORKS
<CAPTION>
AMOUNT ACCUMULATION NUMBER OF
MONTH INVESTED UNIT VALUE UNITS PURCHASED
<S> <C> <C> <C>
Jan $100 $20 5.00
Feb 100 18 5.56
Mar 100 17 5.88
Apr 100 15 6.67
May 100 16 6.25
Jun 100 18 5.56
Jul 100 17 5.88
Aug 100 19 5.26
Sept 100 21 4.76
Oct 100 20 5.00
</TABLE>
You paid an average price of only $17.91 per unit over the 10 months, while the
average market price actually was $18.10.
Dollar-cost averaging does not guarantee that any variable account will gain in
value nor will it protect against a decline in value if market prices fall.
Because dollar-cost averaging involves continuous investing, your success with
this strategy will depend upon your willingness to continue to invest regularly
through periods of low price levels. Dollar-cost averaging can be an effective
way to help meet your long-term goals. For specific features contact your
financial advisor.
By investing an
equal number of
dollars each month...
you automatically -->
buy more units when
the per unit market
price is low...
and fewer units -->
when the per unit
market price is high.
28
<PAGE>
TRANSFERRING MONEY BETWEEN ACCOUNTS
You may transfer money from any one variable account, or the fixed account, to
another account before annuity payouts begin. (Certain restrictions apply to
transfers involving the fixed account.) We will process your transfer on the
valuation date we receive your request. We will value your transfer at the next
accumulation unit value calculated after we receive your request. There is no
charge for transfers. Before making a transfer, you should consider the risks
involved in switching investments.
TRANSFER POLICIES
- -You may transfer contract values between the variable accounts, or from the
variable accounts to the fixed account at any time. However, if you made a
transfer from the fixed account to the variable accounts, you may not make a
transfer from any variable account back to the fixed account until the next
contract anniversary.
- -You may transfer contract values from the fixed account to the variable
accounts once a year during a 31-day transfer period starting on each contract
anniversary (except for automated transfers, which can be set up for certain
transfer periods subject to certain minimums).
- -If we receive your request within 30 days before the contract anniversary date,
the transfer from the fixed account to the variable accounts will be effective
on the anniversary.
- -If we receive your request on or within 30 days after the contract anniversary
date, the transfer from the fixed account to the variable accounts will be
effective on the valuation date we receive it.
- -We will not accept requests for transfers from the fixed account at any other
time.
- -Once annuity payouts begin, you may not make transfers to or from the fixed
account, but you may make transfers once per contract year among the variable
accounts. During the annuity payout period, you cannot invest in more than five
variable accounts at any one time unless we agree otherwise.
29
<PAGE>
- ----------------------------------
MAKING THE MOST OF YOUR CONTRACT
HOW TO REQUEST A TRANSFER OR SURRENDER
<TABLE>
<S> <C> <C>
- -------------------------------------------------------------
Send your name, contract number, Social
1 Security Number or Taxpayer Identification
BY LETTER Number and signed request for a transfer or
surrender to:
REGULAR MAIL:
IDS Life Insurance Company of New York
Box 5144
Albany, NY 12205
EXPRESS MAIL:
IDS Life Insurance Company of New York
20 Madison Ave. Extension
Albany, NY 12203
MINIMUM AMOUNT
Transfers or $250 or entire account
surrenders: balance
MAXIMUM AMOUNT
Transfers or Contract value
surrenders:
</TABLE>
<TABLE>
<S> <C>
- -------------------------------------------------------------
Your financial advisor can help you set up
2 automated transfers among your variable
BY AUTOMATED accounts or fixed account or partial surrenders
TRANSFERS AND from the accounts.
AUTOMATED You can start or stop this service by written
PARTIAL request or other method acceptable to us. You
SURRENDERS must allow 30 days for us to change any
instructions that are currently in place.
</TABLE>
- -Automated transfers from the fixed account to the variable accounts may not
exceed an amount that, if continued, would deplete the fixed account within 12
months.
- -Automated transfers and automated partial surrenders are subject to all of the
contract provisions and terms, including transfer of contract values between
accounts. Automated surrenders may be restricted by applicable law under some
contracts.
- -You may not make additional purchase payments if automated partial surrenders
are in effect.
- -Automated partial surrenders may result in IRS taxes and penalties on all or
part of the amount surrendered.
MINIMUM AMOUNT
Transfers or surrenders: $50
30
<PAGE>
- ----------------------------------
SURRENDERS
You may surrender all or part of your contract at any time before annuity
payouts begin by sending us a written request or calling us. We will process
your surrender request on the valuation date we receive it. For total
surrenders, we will compute the value of your contract at the next accumulation
unit value calculated after we receive your request. We may ask you to return
the contract. You may have to pay surrender charges (see "Charges") and IRS
taxes and penalties (see "Taxes"). You cannot make surrenders after annuity
payouts begin.
SURRENDER POLICIES
If you have a balance in more than one account and you request a partial
surrender, we will withdraw money from all your variable accounts and/or the
fixed account in the same proportion as your value in each account correlates to
your total contract value, unless you request otherwise. The minimum contract
value after partial surrender is $600.
RECEIVING PAYMENT
By regular or express mail:
- -payable to you;
- -mailed to address of record.
NOTE: We will charge you a fee if you request express mail delivery.
By wire:
- -request that payment be wired to your bank;
- -bank account must be in the same ownership as your contract; and
- -pre-authorization required.
For instructions, contact your financial advisor.
Normally, we will send the payment within seven days after receiving your
request. However, we may postpone the payment if:
- -- the surrender amount includes a purchase payment check that has not cleared;
- -- the NYSE is closed, except for normal holiday and weekend closings;
- -- trading on the NYSE is restricted, according to SEC rules;
- -- an emergency, as defined by SEC rules, makes it impractical to sell
securities or value the net assets of the accounts; or
- -- the SEC permits us to delay payment for the protection of security holders.
31
<PAGE>
- ----------------------------------
TSA -- SPECIAL SURRENDER PROVISIONS
PARTICIPANTS IN TAX-SHELTERED ANNUITIES: The Code imposes certain restrictions
on your right to receive early distributions from a TSA:
- -Distributions attributable to salary reduction contributions (plus earnings)
made after Dec. 31, 1988, or to transfers or rollovers from other contracts,
may be made from the TSA only if:
- -- you are at least age 59 1/2;
- -- you are disabled as defined in the Code;
- -- you separated from the service of the employer who purchased the contract; or
- -- the distribution is because of your death.
- -If you encounter a financial hardship (as defined by the Code), you may receive
a distribution of all contract values attributable to salary reduction
contributions made after Dec. 31, 1988, but not the earnings on them.
- -Even though a distribution may be permitted under the above rules, it may be
subject to IRS taxes and penalties (see "Taxes").
- -The employer must comply with certain nondiscrimination requirements for
certain types of contributions under a TSA contract to be excluded from taxable
income. You should consult your employer to determine whether the
nondiscrimination rules apply to you.
- -The above restrictions on distributions do not affect the availability of the
amount credited to the contract as of Dec. 31, 1988. The restrictions also do
not apply to transfers or exchanges of contract value within the contract, or
to another registered variable annuity contract or investment vehicle available
through the employer.
- -If the contract has a loan provision, the right to receive a loan from your
fixed account is described in detail in your contract. You may borrow from the
contract value allocated to the fixed account.
32
<PAGE>
- ----------------------------------
CHANGING OWNERSHIP
You may change ownership of your nonqualified annuity at any time by completing
a change of ownership form we approve and sending it to our office. The change
will become binding upon us when we receive and record it. We will honor any
change of ownership request that we believe is authentic and we will use
reasonable procedures to confirm authenticity. If we follow these procedures, we
will not take any responsibility for the validity of the change.
If you have a nonqualified annuity, you may incur income tax liability by
transferring, assigning or pledging any part of it. (See "Taxes.")
If you have a qualified annuity, you may not sell, assign, transfer, discount or
pledge your contract as collateral for a loan, or as security for the
performance of an obligation or for any other purpose except as required or
permitted by the Code.
33
<PAGE>
- ----------------------------------
BENEFITS IN CASE OF DEATH
We will pay the death benefit to your beneficiary upon the earlier of your death
or the annuitant's death. If a contract has more than one person as the owner,
we will pay benefits upon the first to die of any owner or the annuitant.
If you or the annuitant die before annuity payouts begin while this contract is
in force, we will pay the beneficiary as follows:
If death occurs before the annuitant's 75th birthday, the beneficiary receives
the greatest of:
- -the contract value; or
- -the contract value as of the most recent sixth contract anniversary, minus any
surrenders since that anniversary; or
- -purchase payments, minus any surrenders.
If death occurs on or after the annuitant's 75th birthday, the beneficiary
receives the greater of:
- -the contract value; or
- -the contract value as of the most recent sixth contract anniversary, minus any
surrenders since that anniversary.
IF YOUR SPOUSE IS SOLE BENEFICIARY under a nonqualified annuity and you die
before the retirement date, your spouse may keep the contract as owner. To do
this your spouse must, within 60 days after we receive proof of death, give us
written instructions to keep the contract in force.
Under a qualified annuity, if the annuitant dies before the Code requires
distributions to begin, and the spouse is the only beneficiary, the spouse may
keep the annuity as owner until the date on which the annuitant would have
reached 70 1/2 or any other date permitted by the Code. To do this, the spouse
must give us written instructions within 60 days after we receive proof of
death.
34
<PAGE>
PAYMENTS: Under a nonqualified annuity we will pay the beneficiary in a single
sum unless you give us other written instructions. We must fully distribute the
death benefit within five years of your death. However, the beneficiary may
receive payouts under any annuity payout plan available under this contract if:
- -the beneficiary asks us in writing within 60 days after we receive proof of
death; and
- -payouts begin no later than one year after your death, or other date as
permitted by the Code; and
- -the payout period does not extend beyond the beneficiary's life or life
expectancy.
When paying the beneficiary, we will process the death claim on the valuation
date our death claim requirements are fulfilled. We will determine the
contract's value at the next accumulation unit value calculated after our death
claim requirements are fulfilled. We will pay interest, if any, from the date of
death at a rate no less than required by law. We will mail payment to the
beneficiary within seven days after our death claim requirements are fulfilled.
Other rules may apply to qualified annuities. (See "Taxes").
35
<PAGE>
- ----------------------------------
THE ANNUITY PAYOUT PERIOD
As owner of the contract, you have the right to decide how and to whom annuity
payouts will be made starting at the retirement date. You may select one of the
annuity payout plans outlined below, or we may mutually agree on other payout
arrangements.
The amount available to purchase payouts under the plan you select is the
contract value on your retirement date. We do not deduct any surrender charges
under the payout plans listed below.
You also decide whether we will make annuity payouts on a fixed or variable
basis, or a combination of fixed and variable. You may reallocate this contract
value to the fixed account to provide fixed dollar payouts and/or among the
variable accounts to provide variable annuity payouts. During the annuity payout
period, you cannot invest in more than five variable accounts at any one time
unless we agree otherwise. Amounts of fixed and variable payouts depend on:
- -the annuity payout plan you select;
- -the annuitant's age and, in most cases, sex;
- -the annuity table in the contract; and
- -the amounts you allocated to the accounts at settlement.
In addition, for variable payouts only, amounts depend on the investment
performance of the variable accounts you select. These payouts will vary from
month to month because the performance of the funds will fluctuate. (In the case
of fixed annuities, payouts remain the same from month
to month.)
For information with respect to transfers between accounts after annuity payouts
begin, see "Making the Most of Your Contract -- Transfer policies."
ANNUITY TABLE
The annuity table in your contract shows the amount of the first monthly payment
for each $1,000 of contract value according to the age and, when applicable, the
sex of the annuitant. (Where required by law, we will use a unisex table of
settlement rates.) The table assumes that the contract value is invested at the
beginning of the annuity payout period and earns a 3.5% rate of return, which is
reinvested and helps to support future payouts.
36
<PAGE>
ANNUITY PAYOUT PLANS
You may choose any one of these annuity payout plans by giving us written
instructions at least 30 days before contract values are used to purchase the
payout plan:
- -PLAN A -- LIFE ANNUITY - NO REFUND: We make monthly payouts until the
annuitant's death. Payouts end with the last payout before the annuitant's
death. We will not make any further payouts. This means that if the annuitant
dies after we have made only one monthly payout, we will not make any more
payouts.
- -PLAN B -- LIFE ANNUITY WITH FIVE, 10 OR 15 YEARS CERTAIN: We make monthly
payouts for a guaranteed payout period of five, 10 or 15 years that you elect.
This election will determine the length of the payout period to the beneficiary
if the annuitant should die before the elected period expires. We calculate the
guaranteed payout period from the retirement date. If the annuitant outlives
the elected guaranteed payout period, we will continue to make payouts until
the annuitant's death.
- -PLAN C -- LIFE ANNUITY - INSTALLMENT REFUND: We make monthly payouts until the
annuitant's death, with our guarantee that payouts will continue for some
period of time. We will make payouts for at least the number of months
determined by dividing the amount applied under this option by the first
monthly payout, whether or not the annuitant is living.
- -PLAN D -- JOINT AND LAST SURVIVOR LIFE ANNUITY - NO REFUND: We make monthly
payouts while both the annuitant and a joint annuitant are living. If either
annuitant dies, we will continue to make monthly payouts at the full amount
until the death of the surviving annuitant. Payouts end with the death of the
second annuitant.
- -PLAN E -- PAYOUTS FOR A SPECIFIED PERIOD: We make monthly payouts for a
specific payout period of 10 to 30 years that you elect. We will make payouts
only for the number of years specified whether the annuitant is living or not.
Depending on the selected time period, it is foreseeable that an annuitant can
outlive the payout period selected. In addition, a 10% IRS penalty tax could
apply under this payout plan. (See "Taxes.")
37
<PAGE>
THE ANNUITY PAYOUT PERIOD
RESTRICTIONS FOR SOME QUALIFIED PLANS: If you purchased a qualified annuity, you
may be required to select a payout plan that provides for payouts:
- -over the life of the annuitant;
- -over the joint lives of the annuitant and a designated beneficiary;
- -for a period not exceeding the life expectancy of the annuitant; or
- -for a period not exceeding the joint life expectancies of the annuitant and a
designated beneficiary.
You have the responsibility for electing a payout plan that complies with your
contract and with applicable law.
IF WE DO NOT RECEIVE INSTRUCTIONS: You must give us written instructions for the
annuity payouts at least 30 days before the annuitant's retirement date. If you
do not, we will make payouts under Plan B, with 120 monthly payouts guaranteed.
Contract values that you have allocated to the fixed account will provide fixed
dollar payouts and contract values that you have allocated among the variable
accounts will provide variable annuity payouts.
IF MONTHLY PAYOUTS WOULD BE LESS THAN $20: We will calculate the amount of
monthly payouts at the time the contract value is used to purchase a payout
plan. If the calculations show that monthly payouts would be less than $20, we
have the right to pay the contract value to the owner in a lump sum.
DEATH AFTER ANNUITY PAYOUTS BEGIN
If you or the annuitant die after annuity payouts begin, we will pay any amount
payable to the beneficiary as provided in the annuity payout plan in effect.
38
<PAGE>
- ----------------------------------
TAXES
Generally, under current law, any increase in your contract value is taxable to
you only when you receive a payout or surrender. (See detailed discussion
below.) Any portion of the annuity payouts and any surrenders you request that
represent ordinary income are normally taxable. We will send you a tax
information reporting form for any year in which we made a taxable distribution
according to our records. Roth IRAs may grow and be distributed tax-free if you
meet certain distribution requirements.
ANNUITY PAYOUTS UNDER NONQUALIFIED ANNUITIES: A portion of each payout will be
ordinary income and subject to tax, and a portion of each payout will be
considered a return of part of your investment and will not be taxed. All
amounts you receive after your investment in the contract is fully recovered
will be subject to tax.
Tax law requires that all nonqualified deferred annuity contracts issued by the
same company (and possibly its affiliates) to the same owner during a calendar
year be taxed as a single, unified contract when you take distributions from any
one of those contracts.
QUALIFIED ANNUITIES: We designed this contract for use with qualified retirement
plans. Special rules apply to these retirement plans. Your rights to benefits
may be subject to the terms and conditions of these retirement plans regardless
of the terms of the contract.
Adverse tax consequences may result if you do not ensure that contributions,
distributions and other transactions under the contract comply with the law.
Qualified annuities have minimum distribution rules that govern the timing and
amount of distributions during your life (except for Roth IRAs) and after your
death. You should refer to your retirement plan or adoption agreement, or
consult a tax adviser for more information about these distribution rules.
ANNUITY PAYOUTS UNDER QUALIFIED ANNUITIES (EXCEPT ROTH IRAS): Under a qualified
annuity, the entire payout generally is includable as ordinary income and is
subject to tax except to the extent that contributions were made with after-tax
dollars. If you or your employer invested in your contract with deductible or
pre-tax dollars as part of a
39
<PAGE>
TAXES
qualified retirement plan, such amounts are not considered to be part of your
investment in the contract and will be taxed when paid to you.
SURRENDERS: If you surrender part or all of your contract before your annuity
payouts begin, your surrender payment will be taxed to the extent that the value
of your contract immediately before the surrender exceeds your investment. You
also may have to pay a 10% IRS penalty for surrenders you make before reaching
age 59 1/2 unless certain exceptions apply. For qualified annuities, other
penalties may apply if you surrender your contract before your plan specifies
that you can receive payouts.
DEATH BENEFITS TO BENEFICIARIES: The death benefit under a contract (except Roth
IRAs) is not tax-exempt. Any amount your beneficiary receives that represents
previously deferred earnings within the contract is taxable as ordinary income
to the beneficiary in the year(s) he or she receives the payments. The death
benefit under a Roth IRA generally is not taxable as ordinary income to the
beneficiary if certain distribution requirements are met.
ANNUITIES OWNED BY CORPORATIONS, PARTNERSHIPS OR TRUSTS: For nonqualified
annuities any annual increase in the value of annuities held by such entities
generally will be treated as ordinary income received during that year. This
provision is effective for purchase payments made after Feb. 28, 1986. However,
if the trust was set up for the benefit of a natural person only, the income
will remain tax-deferred.
PENALTIES: If you receive amounts from your contract before reaching age 59 1/2,
you may have to pay a 10% IRS penalty on the amount includable in your ordinary
income. However, this penalty will not apply to any amount received by you or
your beneficiary:
- -because of your death;
- -because you become disabled (as defined in the Code);
- -if the distribution is part of a series of substantially equal periodic
payments, made at least annually, over your life or life expectancy (or joint
lives or life expectancies of you and your beneficiary); or
- -if it is allocable to an investment before Aug. 14, 1982 (except for qualified
annuities).
40
<PAGE>
For a qualified annuity, other penalties or exceptions may apply if you
surrender your contract before your plan specifies that payouts can be made.
WITHHOLDING, GENERALLY: If you receive all or part of the contract value, we may
deduct withholding against the taxable income portion of the payment. Any
withholding represents a prepayment of your tax due for the year. You take
credit for these amounts on your annual tax return.
If the payment is part of an annuity payout plan, we generally compute the
amount of withholding using payroll tables. You may provide us with a statement
of how many exemptions to use in calculating the withholding. As long as you've
provided us with a valid Social Security Number or Taxpayer Identification
Number, you can elect not to have any withholding occur.
If the distribution is any other type of payment (such as a partial or full
surrender), we compute withholding using 10% of the taxable portion. Similar to
above, as long as you have provided us with a valid Social Security Number or
Taxpayer Identification Number, you can elect not to have this withholding
occur.
If you take a distribution from a contract offered under a Section 457 plan
(deferred compensation plan of state and local governments and tax-exempt
organizations), we compute withholding using payroll methods, depending upon the
type of payment.
Some states also impose withholding requirements similar to the federal
withholding described above. If this should be the case, we may deduct state
withholding from any payment from which we deduct federal withholding. The
withholding requirements may differ if we are making payment to a non-U.S.
citizen or if we deliver the payment outside the United States.
WITHHOLDING FROM QUALIFIED ANNUITIES: If you receive directly all or part of the
contract value from a qualified annuity (except an IRA, Roth IRA, SEP or Section
457 plan), mandatory 20% federal income tax withholding (and possibly state
income tax withholding) generally will be imposed at the time
41
<PAGE>
TAXES
the payout is made. This mandatory withholding is in place of the elective
withholding discussed above. This mandatory withholding will not be imposed if:
- -instead of receiving the distribution check, you elect to have the distribution
rolled over directly to an IRA or another eligible plan;
- -the payout is one in a series of substantially equal periodic payouts, made at
least annually, over your life or life expectancy (or the joint lives or life
expectancies of you and your designated beneficiary) or over a specified period
of 10 years or more; or
- -the payout is a minimum distribution required under the Code.
Payments we make to a surviving spouse instead of being directly rolled over to
an IRA also may be subject to mandatory 20% income tax withholding.
State withholding also may be imposed on taxable distributions.
TRANSFER OF OWNERSHIP OF A NONQUALIFIED ANNUITY: If you transfer a nonqualified
annuity without receiving adequate consideration, the transfer is a gift and
also may be a surrender for federal income tax purposes. If the gift is a
currently taxable event for income tax purposes, the original owner will be
taxed on the amount of deferred earnings at the time of the transfer and also
may be subject to the 10% IRS penalty discussed earlier. In this case, the new
owner's investment in the contract will be the value of the contract at the time
of the transfer.
COLLATERAL ASSIGNMENT OF A NONQUALIFIED ANNUITY: If you collaterally assign or
pledge your contract, earnings on purchase payments you made after Aug. 13, 1982
will be taxed to you like a surrender.
IMPORTANT: Our discussion of federal tax laws is based upon our understanding of
current interpretations of these laws. Federal tax laws or current
interpretations of them may change. For this reason and because tax consequences
are complex and highly individual and cannot always be anticipated, you should
consult a tax adviser if you have any questions about taxation of your contract.
TAX QUALIFICATION: We intend that the contract qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract are to be
interpreted to ensure or maintain such tax qualification, in spite of any other
provisions of the
42
<PAGE>
contract. We reserve the right to amend the contract to reflect any
clarifications that may be needed or are appropriate to maintain such
qualification or to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such amendment.
43
<PAGE>
- ----------------------------------
VOTING RIGHTS
As a contract owner with investments in the variable accounts you may vote on
important fund policies until annuity payouts begin. Once they begin, the person
receiving them has voting rights. We will vote fund shares according to the
instructions of the person with voting rights.
Before annuity payouts begin, the number of votes is determined by applying the
percentage interest in each variable account to the total number of votes
allowed to the account.
After annuity payouts begin, the number of votes is equal to:
- -the reserve held in each account for your contract, divided by
- -the net asset value of one share of the
applicable fund.
As we make annuity payouts, the reserve for the annuity decreases; therefore,
the number of votes also will decrease.
We calculate votes separately for each account. We will send notice of these
meetings, proxy materials and a statement of the number of votes to which the
voter is entitled.
We will vote shares for which we have not received instructions in the same
proportion as the votes for which we have received instructions. We also will
vote the shares for which we have voting rights in the same proportion as the
votes for which we have received instructions.
44
<PAGE>
- ----------------------------------
ABOUT THE SERVICE PROVIDERS
PRINCIPAL UNDERWRITER
American Express Financial Advisors Inc. (AEFA) is the principal underwriter for
the contracts. Its offices are located at IDS Tower 10, Minneapolis, MN
55440-0010. AEFA is a wholly-owned
subsidiary of AEFC. AEFC is a wholly-owned subsidiary of American Express
Company, a financial services company headquartered in New York City.
The AEFC family of companies offers not only insurance and annuities, but also
mutual funds, investment certificates and a broad range of financial management
services. AEFA serves individuals and businesses through its nationwide network
of more than 180 offices and 9200 advisors.
ISSUER
IDS Life of New York issues the contracts. IDS Life of New York is a
wholly-owned subsidiary of IDS Life, which is a wholly-owned subsidiary of AEFC.
IDS Life of New York is a stock life insurance company organized in 1972 under
the laws of the State of New York and is located at 20 Madison Avenue Extension,
Albany, New York 12203. Its mailing address is P.O. Box 5144, Albany, NY 12205.
IDS Life of New York conducts a conventional life insurance business.
IDS Life of New York pays total commissions of up to 7.0% of the total purchase
payments it receives on the contracts. We pay a portion of this total commission
to district managers and field vice presidents of the selling representative.
45
<PAGE>
ABOUT THE SERVICE PROVIDERS
LEGAL PROCEEDINGS
A number of lawsuits have been filed against life and health insurers in
jurisdictions in which we do business involving insurers' sales practices,
alleged agent misconduct, failure to properly supervise agents, and other
matters. We, like other life and health insurers , from time to time are
involved in such litigation. On October 13, 1998, an action entitled Richard W.
And Elizabeth J. Thoresen vs. American Express Financial Corporation, American
Centurion Life Assurance Company, American Enterprise Life Insurance Company,
American Partners Life Insurance Company, IDS Life Insurance Company and IDS
Life Insurance Company of New York was commenced in Minnesota state court. The
action was brought by individuals who purchased an annuity in a qualified plan.
They allege that the sale of annuities in tax-deferred contributory retirement
investment plans (e.g., IRAs) is never appropriate. The plaintiffs purport to
represent a class consisting of all persons who made similar purchases. The
plaintiffs seek damages in an unspecified amount. We also are defendants in
various other lawsuits. In our opinion, none of these lawsuits will have a
material adverse effect on our financial condition.
46
<PAGE>
- ----------------------------------
YEAR 2000
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of IDS Life of New York and
the variable accounts. IDS Life of New York and the variable accounts have no
computer systems of their own but are dependent upon the systems of AEFC and
certain other third parties.
A comprehensive review of AEFC's computer systems and business processes has
been conducted to identify the major systems that could be affected by the Year
2000 issue. Steps are being taken to resolve any potential problems including
modification to existing software and the purchase of new software. These
measures are scheduled to be completed and tested on a timely basis. AEFC's
target date for substantially completing corrective measures on business
critical systems was Dec. 31, 1998. Substantial testing of these systems was
targeted for completion early in 1999. AEFC currently is on track with this
schedule and also is on track to finish the work on non-critical systems by June
30, 1999. The Year 2000 readiness of other third parties whose system failures
could have an impact on IDS Life of New York's and the variable accounts'
operations continues to be evaluated. The potential materiality of any such
impact is not known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
47
<PAGE>
TABLE OF CONTENTS OF THE STATEMENT OF ADDITIONAL
INFORMATION
IDS Life of New York Preferred Retirement
Account.................................... 3
Performance Information...................... 4
Calculating Annuity Payouts.................. 7
Rating Agencies.............................. 9
Principal Underwriter........................ 9
Independent Auditors......................... 9
Financial Statements
48
<PAGE>
-----------------------------------------------------------------------
Please check the box to receive a copy of the Statement
of Additional Information for:
/ / IDS Life of New York Flexible Annuity
/ / IDS Life Retirement Annuity Mutual Funds
MAIL YOUR REQUEST TO:
IDS LIFE OF NEW YORK ANNUITY SERVICE
IDS LIFE INSURANCE COMPANY OF NEW YORK
BOX 5144
ALBANY, NY 12205
WE WILL MAIL YOUR REQUEST TO:
Your name _____________________________________________
Address _______________________________________________
City _____________________ State _________ Zip ________
49
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
for
FLEXIBLE ANNUITY
IDS LIFE OF NEW YORK ACCOUNTS 4, 5, 6, 9, 10, 11, 12, 13 and 14
April 30, 1999
IDS Life of New York Accounts 4, 5, 6, 9, 10, 11, 12, 13 and 14 are separate
accounts established and maintained by IDS Life Insurance Company of New York
(IDS Life of New York).
This Statement of Additional Information (SAI) is not a prospectus. It should be
read together with the prospectus dated the same date as this SAI, which may be
obtained from your financial advisor, or by writing or calling us at the address
and telephone number below. The prospectus is incorporated in this SAI by
reference.
IDS Life of New York Annuity Service
20 Madison Avenue Extension
Albany, NY 12203
800-541-2251
<PAGE>
IDS Life of New York Flexible Annuity
IDS Life of New York Accounts 4, 5, 6, 9, 10, 11, 12, 13 and 14
TABLE OF CONTENTS
IDS Life of New York Preferred Retirement Account...................p.3
Performance Information.............................................p.4
Calculating Annuity Payouts.........................................p.7
Rating Agencies.....................................................p.9
Principal Underwriter...............................................p.9
Independent Auditors................................................p.9
Financial Statements
<PAGE>
IDS LIFE OF NEW YORK PREFERRED RETIREMENT ACCOUNT
You may use the Flexible Annuity to fund the IDS Life of New York Preferred
Retirement Account (PRA) as a way to build tax-deferred retirement income. You
may use the PRA to supplement, or as an alternative to, a non-deductible IRA or
other retirement plan.
The advantages of the IDS Life of New York Preferred Retirement Account over a
non-deductible IRA are shown below:
<TABLE>
<CAPTION>
<S> <C> <C>
IDS Life of New York Preferred
Retirement Account Non-deductible IRA
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Maximum amount $1 million initially, then $2,000 per year ($4,000 per year
you can contribute $50,000 per year (spouse can for married individuals filing
have own plan and also jointly)
contribute $50,000, whether or
not employed)
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Highest age you The later of age 85 or the 10th 701/2years old
can contribute contract anniversary
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Types of income Any type: wages, investment Generally limited to income from
you can contribute income, gifts, inheritance, etc. employment
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Records you None required, but IDS Life of You must keep all records
must keep New York furnishes you regular yourself
reports for your files
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Reports you must None You must report all
file with the IRS contributions and withdrawals
each year
- -------------------------------------- ---------------------------------- ----------------------------------
- -------------------------------------- ---------------------------------- ----------------------------------
Age at which you The later of age 85 or the 10th 701/2years old
must begin withdrawals contract anniversary
- -------------------------------------- ---------------------------------- ----------------------------------
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
PERFORMANCE INFORMATION
- -------------------------------------------------------------------------------
The variable accounts may quote various performance figures to illustrate past
performance. We base total return and current yield quotations (if applicable)
on standardized methods of computing performance as required by the Securities
and Exchange Commission (SEC). An explanation of the methods used to compute
performance follows below.
Average Annual Total Return
We will express quotations of average annual total return for the variable
accounts in terms of the average annual compounded rate of return of a
hypothetical investment in the contract over a period of one, five and 10 years
(or, if less, up to the life of the variable accounts), calculated 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 period, at
the end of the period (or fractional portion
thereof)
We calculated the following performance figures on the basis of historical
performance of each fund. Past performance does not guarantee future results.
Average Annual Total Return With Surrender For Periods Ending Dec. 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Variable Account Investing in: 1 Year 5 Years 10 Years Since
------------------------------- Inception
IDS Life
- ------------------
11 Aggressive Growth Fund -5.47% 8.49% 9.71%
(1/92)* ---%
- ------------------
4 Capital Resource Fund (10/81) 15.80 14.54 14.62 ---
- ------------------
12 Global Yield Fund (4/96) -0.09 --- 3.88
---
- ------------------
14 Growth Dimensions Fund (4/96) 20.27 --- 21.09
---
- ------------------
13 Income Advantage Fund (4/96) -12.43 --- 1.61
---
- ------------------
10 International Equity Fund 7.59 5.10 8.28
(1/92) ---
- ------------------
9 Managed Fund (4/86) 7.56 11.86 13.39 ---
- ------------------
6 Moneyshare Fund (10/81) -2.98 2.59 4.22 ---
- ------------------
5 Special Income Fund (10/81) -6.58 4.43 7.76 ---
* (Commencement dates of the Funds)
</TABLE>
Average Annual Total Return Without Surrender For Periods Ending Dec. 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Variable Account Investing in: 1 Year 5 Years 10 Years Since Inception
-------------------------------
IDS Life
- ------------------
11 Aggressive Growth Fund 1.53% 9.48% 9.71%
(1/92)* ---%
- ------------------
4 Capital Resource Fund (10/81) 22.80 15.34 14.62 ---
- ------------------
12 Global Yield Fund (4/96) 6.91 --- 6.30
---
- ------------------
14 Growth Dimensions Fund (4/96) 27.27 --- 22.97
---
- ------------------
13 Income Advantage Fund (4/96) -5.43 --- 4.11
---
- ------------------
10 International Equity Fund 14.59 6.22 8.28
(1/92) ---
- ------------------
9 Managed Fund (4/86) 14.56 12.74 13.39 ---
- ------------------
6 Moneyshare Fund (10/81) 4.02 3.82 4.22 ---
- ------------------
5 Special Income Fund (10/81) 0.42 5.58 7.76 ---
* (Commencement dates of the Funds)
</TABLE>
<PAGE>
Cumulative Total Return
Cumulative total return represents the cumulative change in the value of an
investment for a given period (reflecting change in a variable account's
accumulation unit value). We compute aggregate total return by using the
following formula:
ERV - P
P
where: P = a hypothetical initial payment of $1,000
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the period, at the
end of the period (or fractional portion thereof).
The SEC requires that we assume that you surrender the entire contract at the
end of the one, five and 10 year periods (or, if less, up to the life of the
variable account). In addition, we may show performance figures without the
deduction of a surrender charge. All total return figures reflect the deduction
of all applicable charges including the contract administrative charge and
mortality and expense risk fee.
Calculation of Yield for Variable Account Investing in Money Market Fund
Annualized Simple Yield:
For the variable account investing in the money market fund, we base quotations
of simple yield on:
(a) the change in the value of a hypothetical variable account
(exclusive of capital changes and income other than investment
income) at the beginning of a particular seven-day period;
(b) less a pro rata share of the variable account expenses accrued over
the period;
(c) dividing this difference by the value of the variable account at
the beginning of the period to obtain the base period return; and
(d) multiplying the base period return by 365/7.
The variable account's value includes:
o any declared dividends,
o the value of any shares purchased with dividends paid during the period, and
o any dividends declared for such shares.
It does not include:
o the effect of any applicable surrender charge, or o any realized or unrealized
gains or losses.
Annualized Compound Yield:
We calculate compound yield using the base period return described above, which
we then compound according to the following formula:
Compound Yield = [(Base Period Return + 1)365/7] -1
Annualized Yield Based on the Seven-Day Period Ending Dec. 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Variable Account Investing In: Simple Yield Compound Yield
6 IDS Life Moneyshare Fund 3.73% 3.80%
</TABLE>
<PAGE>
You must consider (when comparing an investment in variable accounts investing
in money market funds with fixed annuities) that fixed annuities often provide
an agreed-to or guaranteed yield for a stated period of time, whereas the
variable account's yield fluctuates. In comparing the yield of the variable
account to a money market fund, you should consider the different services that
the contract provides.
Annualized Yield for Variable Accounts Investing in Income Funds
For the variable accounts investing in income funds, we base quotations of yield
on all investment income earned during a particular 30-day period, less expenses
accrued during the period (net investment income) and compute it by dividing net
investment income per accumulation unit by the value of an accumulation unit on
the last day of the period, according to the following formula:
YIELD = 2[( a-b + 1)6 - 1]
cd
where: a = dividends and investment income earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of accumulation units
outstanding during the period that were entitled to
receive dividends
d = the maximum offering price per accumulation unit on the
last day of the period
The variable account earns yield from the increase in the net asset value of
shares of the fund in which it invests and from dividends declared and paid by
the fund, which are automatically invested in shares of the fund.
Annualized Yield Based on the 30-Day Period Ended Dec. 31, 1998
Variable Account Investing in: Yield
12 IDS Life Global Yield Fund 5.37%
13 IDS Life Income Advantage Fund 9.53
5 IDS Life Special Income Fund 7.24
The yield on the variable account's accumulation unit may fluctuate daily and
does not provide a basis for determining future yields.
Independent rating or statistical services or publishers or publications such as
those listed below may quote variable account performance, compare it to
rankings, yields or returns, or use it in variable annuity accumulation or
settlement illustrations they publish or prepare.
The Bank Rate Monitor National Index, Barron's, Business Week, CDA
Technologies, Donoghue's Money Market Fund Report, Financial Services
Week, Financial Times, Financial World, Forbes, Fortune, Global
Investor, Institutional Investor, Investor's Daily, Kiplinger's
Personal Finance, Lipper Analytical Services, Money, Morningstar,
Mutual Fund Forecaster, Newsweek, The New York Times, Personal
Investor, Stanger Report, Sylvia Porter's Personal Finance, USA Today,
U.S. News and World Report, The Wall Street Journal and Wiesenberger
Investment Companies Service.
CALCULATING ANNUITY PAYOUTS
The Variable Accounts
We do the following calculations separately for each of the variable accounts.
The separate monthly payouts, added together, make up your total variable
annuity payout.
<PAGE>
Initial Payout: To compute your first monthly payment, we:
o determine the dollar value of your contract as of the valuation date that
falls on (or closest to the valuation date that falls before) the seventh
calendar day before the retirement date; then
o apply the result to the annuity table contained in the contract or another
table at least as favorable.
The annuity table shows the amount of the first monthly payment for each $1,000
of value which depends on factors built into the table, as described below.
Annuity Units: We then convert the value of each variable account to annuity
units. To compute the number of units credited to you, we divide the first
monthly payment by the annuity unit value (see below) on the valuation date that
falls on (or closest to the valuation date that falls before) the seventh
calendar day before the retirement date. The number of units in your variable
account is fixed. The value of units fluctuates with the performance of the
underlying fund.
Subsequent Payouts: To compute later payouts, we multiply:
o the annuity unit value on the valuation date that falls on (or closest to
the valuation date that falls before) the seventh calendar day before the
payout is due; by
o the fixed number of annuity units credited to you.
Annuity Unit Values: We originally set this value at $1 for each variable
account. To calculate later values we multiply the last annuity value by the
product of:
o the net investment factor; and
o the neutralizing factor.
The purpose of the neutralizing factor is to offset the effect of the assumed
investment rate built into the annuity table. With an assumed investment rate of
3.5%, the neutralizing factor is 0.999906 for a one day valuation period.
Net Investment Factor: We determine the net investment factor by:
o adding the fund's current net asset value per share plus the per share
amount of any accrued income or capital gain dividends to obtain a current
adjusted net asset value per share; then
o dividing that sum by the previous adjusted net asset value per share; and
o subtracting the percentage factor representing the mortality and expense risk
fee from the result.
Because the net asset value of the fund may fluctuate, the net investment factor
my be greater or less than one, and the annuity unit value may increase or
decrease. You bear this investment risk in a variable account.
The Fixed Account
We guarantee your fixed annuity payout amounts. Once calculated, your payout
will remain the same and never change. To calculate your annuity payouts we:
o take the value of your fixed account at the retirement date or the date you
have selected to begin receiving your annuity payouts; then
o using an annuity table, we apply the value according to the annuity payout
plan you select.
The annuity payout table we use will be the one in effect at the time you choose
to begin your annuity payouts. The values in the table will be equal to or
greater than the table in your contract.
<PAGE>
RATING AGENCIES
The following chart reflects the ratings given to us by independent rating
agencies. These agencies evaluate the financial soundness and claims-paying
ability of insurance companies based on a number of different factors. This
information does not relate to the management or performance of the variable
accounts of the contract. This information relates only to the fixed account and
reflects our ability to make annuity payouts and to pay death benefits and other
distributions from the contract.
Rating Agency Rating
A.M. Best A+
(Superior)
- -----------------------
Duff & Phelps AAA
- -----------------------
Moody's Aa2
PRINCIPAL UNDERWRITER
The principal underwriter for the contract is American Express Financial
Advisors Inc. (AEFA) which offers the contract on a continuous basis.
Surrender charges received by IDS Life of New York for the last three years
aggregated total $886,431, $688,445 and $551,374, respectively.
Commissions paid by IDS Life of New York for the last three years aggregated
total $1,115,312, $1,067,783 and $1,036,511, respectively.
INDEPENDENT AUDITORS
The financial statements appearing in this SAI have been audited by Ernst &
Young LLP (1400 Pillsbury Center, 200 South Sixth Street, Minneapolis, MN
55402), independent auditors, as stated in their report appearing herein.
FINANCIAL STATEMENTS
<PAGE>
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
Annual Financial Information
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company of New York
We have audited the accompanying individual and combined statements of net
assets of IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6, and 5 as
of December 31, 1998, and the related statements of operations for the year
then ended, and the statements of changes in net assets for each of the two
years in the period then ended. These financial statements are the
responsibility of the management of IDS Life Insurance Company of New York.
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 at December 31, 1998
with the affiliated 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 individual and combined financial position of IDS
Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5 at December 31,
1998, and the individual and combined results of their operations and changes
in their net assets for the periods described above, in conformity with
generally accepted accounting principles.
Ernst & Young LLP
Minneapolis, Minnesota
March 12, 1999
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
Statements of Net Assets Dec. 31, 1998
Segregated Asset Account
Assets 11 4 12 14 13
Investments in shares of mutual funds:
<S> <C> <C> <C> <C> <C>
at cost $123,243,500 $202,002,842 $ 7,124,381 $ 91,488,873 $ 22,628,199
------------ ------------ ----------- ------------ ------------
at market value $140,864,946 $266,689,731 $ 7,342,621 $131,751,631 $ 19,971,662
Dividends receivable - - 33,742 - 157,996
Accounts receivable from
IDS Life of New York
for contract purchase payments 15,993 20,108 2,153 18,252 65,536
Receivable from mutual funds
for share redemptions 184,003 314,843 30 92,929 27
------- ------- -- ------ --
Total assets 141,064,942 267,024,682 7,378,546 131,862,812 20,195,221
=========== =========== ========= =========== ==========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 120,032 227,309 6,267 111,181 16,778
Contract terminations 79,442 107,642 30 - 27
Payable to mutual funds
for investments purchased - - 29,628 - 206,754
------- ------- ------ ------- -------
Total liabilities 199,474 334,951 35,925 111,181 223,559
------- ------- ------ ------- -------
Net assets applicable to contracts in
accumulation period 140,677,457 266,251,078 7,335,901 131,457,963 19,885,266
Net assets applicable to contracts in
payment period 188,011 438,653 6,720 293,668 86,396
------- ------- ----- ------- ------
Total net assets $140,865,468 $266,689,731 $ 7,342,621 $131,751,631 $ 19,971,662
============ ============ =========== ============ ============
Accumulation units outstanding 73,609,533 37,947,379 6,220,179 75,581,024 17,820,086
========== ========== ========= ========== ==========
Net asset value per accumulation unit $ 1.91 $ 7.02 $ 1.18 $ 1.74 $ 1.12
====== ====== ====== ====== ======
Combined
Variable
Assets 10 9 6 5 Accounts
Investments in shares of mutual funds:
at cost $ 94,087,157 $ 216,561,627 $ 14,733,130 $84,338,512 $ 856,208,221
------------ ------------- ------------ ----------- -------------
at market value $ 117,314,136 $ 273,226,641 $ 14,733,973 $81,971,372 $ 1,053,866,713
Dividends receivable - - 59,160 504,016 754,914
Accounts receivable from
IDS Life of New York
for contract purchase payments 9,642 12,676 550 2,724 147,634
Receivable from mutual funds
for share redemptions 152,277 338,125 15,247 39,201 1,136,682
------- ------- ------ ------ ---------
Total assets 117,476,055 273,577,442 14,808,930 82,517,313 1,055,905,943
=========== =========== ========== ========== =============
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 100,438 233,537 12,638 69,936 898,116
Contract terminations 61,481 117,264 13,848 39,201 418,935
Payable to mutual funds
for investments purchased - - - 436,805 673,187
------- ------- ------ ------- -------
Total liabilities 161,919 350,801 26,486 545,942 1,990,238
------- ------- ------ ------- ---------
Net assets applicable to contracts in
accumulation period 117,212,268 271,548,162 14,733,963 81,707,159 1,050,809,217
Net assets applicable to contracts in
payment period 101,868 1,678,479 48,481 264,212 3,106,488
------- --------- ------ ------- ---------
Total net assets $ 117,314,136 $ 273,226,641 $ 14,782,444 $81,971,371 $ 1,053,915,705
============= ============= ============ =========== ===============
Accumulation units outstanding 67,198,176 67,427,842 6,515,203 20,261,804
========== ========== ========= ==========
Net asset value per accumulation unit $ 1.74 $ 4.03 $ 2.26 $ 4.03
====== ====== ====== ======
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
Statements of Operations Year ended Dec. 31, 1998
Segregated Asset Account
Investment income 11 4 12 14 13
<S> <C> <C> <C> <C> <C>
Dividend income from mutual funds $ 9,054,750 $ 19,506,033 $ 382,852 $ 671,305 $ 2,035,706
Mortality and expense risk fee 1,398,795 2,450,992 69,940 1,077,632 187,749
--------- --------- ------ --------- -------
Investment income (loss) - net 7,655,955 17,055,041 312,912 (406,327) 1,847,957
--------- ---------- ------- -------- ---------
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of
investments in mutual funds:
Proceeds from sales 14,184,613 24,936,227 827,876 4,335,045 747,945
Cost of investments sold 12,069,051 19,817,150 815,309 3,671,421 809,788
---------- ---------- ------- --------- -------
Net realized gain (loss) on investments 2,115,562 5,119,077 12,567 663,624 (61,843)
Net change in unrealized appreciation or
depreciation of investments (7,859,696) 29,118,857 137,901 26,290,819 (3,028,865)
---------- ---------- ------- ---------- ----------
Net gain (loss) on investments (5,744,134) 34,237,934 150,468 26,954,443 (3,090,708)
---------- ---------- ------- ---------- ----------
Net increase (decrease) in net assets
resulting from operations $ 1,911,821 $ 51,292,975 $ 463,380 $ 26,548,116 $ (1,242,751)
=========== ============ ========= ============ ============
Combined
Variable
Investment income 10 9 6 5 Accounts
Dividend income from mutual funds $ 1,598,070 $ 30,402,738 $ 573,706 $ 6,394,345 $ 70,619,505
Mortality and expense risk fee 1,222,895 2,659,313 115,192 855,299 10,037,807
--------- --------- ------- ------- ----------
Investment income (loss) - net 375,175 27,743,425 458,514 5,539,046 60,581,698
------- ---------- ------- --------- ----------
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of
investments in mutual funds:
Proceeds from sales 15,339,456 24,189,668 7,734,952 8,896,580 101,192,362
Cost of investments sold 12,847,029 18,585,560 7,735,134 8,779,041 85,129,483
---------- ---------- --------- --------- ----------
Net realized gain (loss) on investments 2,492,427 5,604,108 (182) 117,539 16,062,879
Net change in unrealized appreciation or
depreciation of investments 13,306,339 2,865,218 181 (5,140,132) 55,690,622
---------- --------- --- ---------- ----------
Net gain (loss) on investments 15,798,766 8,469,326 (1) (5,022,593) 71,753,501
---------- --------- -- ---------- ----------
Net increase (decrease) in net assets
resulting from operations $ 16,173,941 $ 36,212,751 $ 458,513 $ 516,453 $ 132,335,199
============ ============ ========= ========= =============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
Statements of Changes in Net Assets Year ended Dec. 31, 1998
Segregated Asset Account
Operations 11 4 12 14 13
<S> <C> <C> <C> <C> <C>
Investment income (loss) - net $ 7,655,955 $ 17,055,041 $ 312,912 $ (406,327) $ 1,847,957
Net realized gain (loss) on investments 2,115,562 5,119,077 12,567 663,624 (61,843)
Net change in unrealized appreciation or
depreciation of investments (7,859,696) 29,118,857 137,901 26,290,819 (3,028,865)
---------- ---------- ------- ---------- ----------
Net increase (decrease) in net assets
resulting from operations 1,911,821 51,292,975 463,380 26,548,116 (1,242,751)
========= ========== ======= ========== ==========
Contract transactions
Contract purchase payments 4,421,131 5,806,702 184,571 5,409,816 726,812
Net transfers* (3,672,384) (6,960,384) 1,374,494 19,608,356 6,954,351
Transfers for policy loans 184,854 335,008 4,720 167,119 45,712
Annuity payments (10,778) (33,467) (957) (19,486) (6,630)
Contract charges (103,367) (183,200) (3,626) (71,125) (9,699)
Contract terminations:
Surrender benefits (11,661,490) (20,902,820) (801,371) (7,845,925) (1,696,921)
Death benefits (429,170) (890,715) (35,368) (424,337) (52,222)
-------- -------- ------- -------- -------
Increase (decrease) from
contract transactions (11,271,204) (22,828,876) 722,463 16,824,418 5,961,403
----------- ----------- ------- ---------- ---------
Net assets at beginning of year 150,224,851 238,225,632 6,156,778 88,379,097 15,253,010
----------- ----------- --------- ---------- ----------
Net assets at end of year $140,865,468 $266,689,731 $ 7,342,621 $131,751,631 $ 19,971,662
============ ============ =========== ============ ============
Accumulation unit activity
Units outstanding at beginning of year 79,813,154 41,665,709 5,577,842 64,612,620 12,893,865
Contracts purchase payments 2,347,838 941,002 162,582 3,607,051 615,020
Net transfers* (2,150,607) (1,145,728) 1,212,905 12,837,578 5,799,100
Transfers for policy loans 97,253 54,236 4,142 110,016 40,113
Contract charges (55,790) (30,078) (3,201) (47,826) (8,294)
Contract terminations:
Surrender benefits (6,207,104) (3,392,227) (703,177) (5,260,281) (1,477,128)
Death benefits (235,211) (145,535) (30,914) (278,134) (42,590)
-------- -------- ------- -------- -------
Units outstanding at end of year 73,609,533 37,947,379 6,220,179 75,581,024 17,820,086
========== ========== ========= ========== ==========
Combined
Variable
Operations 10 9 6 5 Accounts
Investment income (loss) - net $ 375,175 $ 27,743,425 $ 458,514 $ 5,539,046 $ 60,581,698
Net realized gain (loss) on investments 2,492,427 5,604,108 (182) 117,539 16,062,879
Net change in unrealized appreciation or
depreciation of investments 13,306,339 2,865,218 181 (5,140,132) 55,690,622
---------- --------- --- ---------- ----------
Net increase (decrease) in net assets
resulting from operations 16,173,941 36,212,751 458,513 516,453 132,335,199
========== ========== ======= ======= ===========
Contract transactions
Contract purchase payments 3,454,091 5,851,798 956,679 1,840,758 28,652,358
Net transfers* (6,922,424) (2,948,412) 6,084,219 (375,040) 13,142,776
Transfers for policy loans 132,624 334,952 18,595 66,124 1,289,708
Annuity payments (8,688) (129,461) (7,793) (24,593) (241,853)
Contract charges (86,302) (188,565) (6,179) (55,442) (707,505)
Contract terminations:
Surrender benefits (10,283,583) (24,128,680) (2,732,124) (7,601,592) (87,654,506)
Death benefits (530,518) (1,575,260) (178,740) (474,110) (4,590,440)
-------- ---------- -------- -------- ----------
Increase (decrease) from
contract transactions (14,244,800) (22,783,628) 4,134,657 (6,623,895) (50,109,462)
----------- ----------- --------- ---------- -----------
Net assets at beginning of year 115,384,995 259,797,518 10,189,274 88,078,813 971,689,968
----------- ----------- ---------- ---------- -----------
Net assets at end of year $ 117,314,136 $ 273,226,641 $ 14,782,444 $81,971,371 $ 1,053,915,705
============= ============= ============ =========== ===============
Accumulation unit activity
Units outstanding at beginning of year 75,831,387 73,556,872 4,651,207 21,881,898
Contracts purchase payments 2,051,106 1,682,384 431,786 454,462
Net transfers* (4,297,233) (792,578) 2,739,126 (69,146)
Transfers for policy loans 78,001 89,491 8,363 16,310
Contract charges (51,807) (51,081) (2,864) (13,768)
Contract terminations:
Surrender benefits (6,103,008) (6,626,757) (1,231,612) (1,891,374)
Death benefits (310,270) (430,489) (80,803) (116,578)
-------- -------- ------- --------
Units outstanding at end of year 67,198,176 67,427,842 6,515,203 20,261,804
========== ========== ========= ==========
*Includes transfer activity from (to) other accounts and transfers from (to) IDS
Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Statements of Changes in Net Assets Year ended Dec. 31, 1997
Segregated Asset Account
Operations 11 4 12 14 13
<S> <C> <C> <C> <C> <C>
Investment income (loss) - net $ 11,797,459 $ 4,261,366 $ 182,490 $ (88,569) $ 824,724
Net realized gain (loss) on investments 990,063 4,961,128 3,288 36,110 4,947
Net change in unrealized appreciation or
depreciation of investments 2,801,037 37,279,668 2,041 12,608,281 296,319
--------- ---------- ----- ---------- -------
Net increase (decrease) in net assets
resulting from operations 15,588,559 46,502,162 187,819 12,555,822 1,125,990
========== ========== ======= ========== =========
Contract transactions
Contract purchase payments 5,879,059 7,229,181 270,483 5,022,138 540,362
Net transfers* 4,544,656 (19,890,234) 3,401,265 42,545,064 9,201,341
Transfers for policy loans 139,573 272,584 3,119 85,728 6,882
Annuity payments (5,390) (22,358) (673) (7,187) (1,549)
Contract charges (111,055) (191,583) (2,380) (45,102) (5,625)
Contract terminations:
Surrender benefits (6,495,887) (14,650,463) (162,887) (2,553,237) (484,531)
Death benefits (360,612) (942,624) (17,785) (123,631) (36,753)
-------- -------- ------- -------- -------
Increase (decrease) from
contract transactions 3,590,344 (28,195,497) 3,491,142 44,923,773 9,220,127
--------- ----------- --------- ---------- ---------
Net assets at beginning of year 131,045,948 219,918,967 2,477,817 30,899,502 4,906,893
----------- ----------- --------- ---------- ---------
Net assets at end of year $ 150,224,851 $ 238,225,632 $ 6,156,778 $88,379,097 $ 15,253,010
============= ============= =========== =========== ============
Accumulation unit activity
Units outstanding at beginning of year 77,672,683 47,282,795 2,311,440 27,817,069 4,671,075
Contract purchase payments 3,418,102 1,421,479 252,875 4,088,492 498,343
Net transfers* 2,638,842 (4,052,868) 3,188,152 34,812,118 8,236,920
Transfers for policy loans 80,471 51,985 2,904 69,853 6,047
Contract charges (64,104) (37,611) (2,228) (35,850) (5,010)
Contract terminations:
Surrender benefits (3,722,288) (2,816,039) (159,040) (2,043,382) (482,092)
Death benefits (210,552) (184,032) (16,261) (95,680) (31,418)
-------- -------- ------- ------- -------
Units outstanding at end of year 79,813,154 41,665,709 5,577,842 64,612,620 12,893,865
========== ========== ========= ========== ==========
Combined
Variable
Operations 10 9 6 5 Accounts
Investment income (loss) - net $ 3,144,194 $ 23,680,012 $ 474,716 $ 7,388,075 $51,664,467
Net realized gain (loss) on investments 905,797 2,972,066 1,584 517,463 10,392,446
Net change in unrealized appreciation or
depreciation of investments (1,978,110) 14,481,685 (1,623) (1,216,238) 64,273,060
---------- ---------- ------ ---------- ----------
Net increase (decrease) in net assets
resulting from operations 2,071,881 41,133,763 474,677 6,689,300 126,329,973
========= ========== ======= ========= ===========
Contract transactions
Contract purchase payments 4,673,649 7,699,003 1,832,361 2,385,529 35,531,765
Net transfers* (711,075) 3,948,878 (3,125,491) (5,786,440) 34,127,964
Transfers for policy loans 118,146 226,152 28,176 59,837 940,197
Annuity payments (4,710) (107,573) (2,589) (17,323) (169,352)
Contract charges (95,854) (193,749) (6,932) (64,936) (717,216)
Contract terminations: -
Surrender benefits (6,643,035) (15,399,711) (1,274,842) (6,268,353) (53,932,946)
Death benefits (439,998) (1,763,994) (101,744) (411,415) (4,198,556)
-------- ---------- -------- -------- ----------
Increase (decrease) from
contract transactions (3,102,877) (5,590,994) (2,651,061) (10,103,101) 11,581,856
---------- ---------- ---------- ----------- ----------
Net assets at beginning of year 116,415,991 224,254,749 12,365,658 91,492,614 833,778,139
----------- ----------- ---------- ---------- -----------
Net assets at end of year $115,384,995 $259,797,518 $ 10,189,274 $ 88,078,813 $971,689,968
============ ============ ============ ============ ============
Accumulation unit activity
Units outstanding at beginning of year 77,830,409 75,218,566 5,926,901 24,424,365
Contract purchase payments 3,057,399 2,338,828 862,329 622,432
Net transfers* (461,511) 1,372,623 (1,391,037) (1,408,968)
Transfers for policy loans 76,481 69,343 13,228 15,521
Contract charges (62,637) (59,844) (3,320) (17,032)
Contract terminations:
Surrender benefits (4,322,303) (4,832,667) (708,870) (1,646,845)
Death benefits (286,451) (549,977) (48,024) (107,575)
-------- -------- ------- --------
Units outstanding at end of year 75,831,387 73,556,872 4,651,207 21,881,898
========== ========== ========= ==========
*Includes transfer activity from (to) other accounts and transfers from (to) IDS
Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
Notes to Financial Statements
1. Organization
IDS Life of New York Accounts 11, 4, 12, 14, 13, 10, 9, 6 and 5
(collectively, the Accounts) were established under New York law as
segregated asset accounts of IDS Life Insurance Company of New York (IDS Life
of New York). The Accounts are registered together as a single unit
investment trust under the Investment Company Act of 1940, as amended (the
1940 Act). Accounts 4, 5 and 6 were established on Nov. 12, 1981 and
commenced operations on Oct. 25, 1982. Account 9 was established on Feb. 12,
1986 and commenced operations on April 30, 1986. Accounts 10 and 11 were
established on Oct. 8, 1991 and commenced operations on Jan. 13, 1992.
Accounts 12, 13 and 14 were established on April 17, 1996 and commenced
operations on April 30, 1996.
Each Account invests exclusively in shares of the following funds
(collectively, the Funds), which are registered under the 1940 Act as
diversified (non-diversified for Global Yield) open-end management investment
companies and have the following investment managers.
Account Invests exclusively in shares of Investment Manager
11 IDS Life Aggressive Growth Fund IDS Life Insurance Company 1
4 IDS Life Capital Resource Fund IDS Life Insurance Company 1
12 IDS Life Global Yield Fund IDS Life Insurance Company 1
14 IDS Life Growth Dimension Fund IDS Life Insurance Company 1
13 IDS Life Income Advantage Fund IDS Life Insurance Company 1
10 IDS Life International Equity Fund IDS Life Insurance Company 2
9 IDS Life Managed Fund IDS Life Insurance Company 1
6 IDS Life Moneyshare Fund IDS Life Insurance Company 1
5 IDS Life Special Income Fund IDS Life Insurance Company 1
1 American Express Financial Corporation (AEFC) is the investment advisor.
2 AEFC is the investment advisor. American Express Asset Management
International Inc. is the sub-investment advisor.
The assets of the Accounts are not chargeable with liabilities arising out of
the business conducted by any other segregated asset account or by IDS Life
of New York.
IDS Life of New York serves as issuer of the contracts.
2. Summary of Significant Accounting Policies
Investments in the Funds
Investments in shares of the Funds are stated at market value which is the
net asset value per share as determined by the respective Funds. Investment
transactions are accounted for on the date the shares are purchased and sold.
The cost of investments sold and redeemed is determined on the average cost
method. Dividend distributions received from the Funds are reinvested in
additional shares of the Funds and are recorded as income by the Accounts on
the ex-dividend date.
Unrealized appreciation or depreciation of investments in the accompanying
financial statements represents the Accounts' share of the Funds'
undistributed net investment income, undistributed realized gain or loss and
the unrealized appreciation or depreciation on their investment securities.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the period. Actual results could differ from those estimates.
Federal Income Taxes
IDS Life of New York is taxed as a life insurance company. The Accounts are
treated as part of IDS Life of New York for federal income tax purposes.
Under existing tax law, no income taxes are payable with respect to any
investment income of the Accounts.
3. Mortality and Expense Risk Fee
IDS Life of New York makes contractual assurances to the Accounts that
possible future adverse changes in administrative expenses and mortality
experience of the contract owners and annuitants will not affect the
Accounts. The mortality and expense risk fee paid to IDS Life of New York is
computed daily and is equal, on an annual basis, to 1% of the average daily
net assets of the Accounts.
4. Contract Administrative Charges
An annual charge of $20 is deducted from the contract value of each Variable
Retirement Annuity contract. An annual charge of $30 is deducted from the
contract value of each Combination Retirement Annuity contract. An annual
charge of $30 is deducted from the certificate value of each Employee Benefit
Annuity Certificate. A quarterly charge of $6 is deducted from the contract
value of each Flexible Annuity contract. The annual charges are deducted at
contract or certificate year end and the quarterly charges are deducted at
contract quarter end, during the accumulation period, for administrative
services provided to the Accounts by IDS Life of New York.
A contingent deferred sales charge (surrender charge) will be imposed upon:
a) certain Variable Retirement Annuity contract surrenders during
the first seven years,
b) Combination Retirement Annuity contract surrenders during the first
eleven years,
c) Employee Benefit Annuity Certificate surrenders during the first eleven
years, and
d) Flexible Annuity contract surrenders of amounts other than those
representing earnings or those representing purchase payments six
contract years old or more.
Charges by IDS Life of New York for surrenders are not identified on an
individual segregated asset account basis. Charges for all segregated asset
accounts amounted to $886,431 in 1998 and $688,445 in 1997. Such charges are
not treated as a separate expense of the Accounts. They are ultimately
deducted from contract surrender benefits paid by IDS Life of New York.
5. Investment in Shares
The Accounts' investment in shares of the Funds as of Dec. 31, 1998 were
as follows:
Account Investment Shares NAV
11 IDS Life Aggressive Growth Fund 9,186,739 $15.33
4 IDS Life Capital Resource Fund 8,167,158 32.65
12 IDS Life Global Yield Fund 691,174 10.62
14 IDS Life Growth Dimensions Fund 7,522,203 17.52
13 IDS Life Income Advantage Fund 2,241,296 8.91
10 IDS Life International Equity Fund 7,531,151 15.58
9 IDS Life Managed Fund 14,752,985 18.52
6 IDS Life Moneyshare Fund 14,734,224 1.00
5 IDS Life Special Income Fund 7,380,353 11.11
6. Investment Transactions
The Accounts' purchases of Funds' shares including reinvestment of dividend
distributions, were as follows:
Year ended Dec. 31,
Account Investment 1998 1997
11 IDS Life Aggressive Growth Fund $ 10,432,973 $ 20,497,759
4 IDS Life Capital Resource Fund 18,946,281 9,955,200
12 IDS Life Global Yield Fund 1,863,251 3,853,859
14 IDS Life Growth Dimensions Fund 20,674,399 45,132,222
13 IDS Life Income Advantage Fund 8,557,305 10,166,644
10 IDS Life International Equity Fund 1,364,968 7,642,538
9 IDS Life Managed Fund 28,913,799 30,461,765
6 IDS Life Moneyshare Fund 12,279,652 6,472,896
5 IDS Life Special Income Fund 7,811,731 8,519,432
Combined Variable Accounts $110,844,359 $142,702,315
7. Year 2000 Issue (unaudited)
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of IDS Life of New York and
the Account. IDS Life of New York and the Account have no computer systems of
their own but are dependent upon the systems of AEFC and certain other third
parties.
A comprehensive review of AEFC's computer systems and business processes has
been conducted to identify the major systems that could be affected by the Year
2000 issue. Steps are being taken to resolve any potential problems including
modification to existing software and the purchase of new software. These
measures are scheduled to be completed and tested on a timely basis. AEFC's
target date for substantially completing corrective measures on business
critical systems was Dec. 31, 1998. Substantial testing of these systems was
targeted for completion early in 1999. AEFC is currently on track with this
schedule and is also on track to finish the work on non-critical systems by June
30, 1999. The Year 2000 readiness of unaffiliated investment managers and other
third parties whose system failures could have an impact on IDS Life of New
York's and the Account's operations continues to be evaluated. The potential
materiality of any such impact is not known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
<PAGE>
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
IDS LIFE OF NEW YORK FINANCIAL INFORMATION
- -----------------------------------------------------------------
The financial statements shown below are those of the insurance company and not
those of any other entity. They are included for the purpose of informing the
investor as to the financial condition of the insurance company and its ability
to carry out its obligations under its variable contracts.
IDS LIFE INSURANCE COMPANY OF NEW YORK
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
DEC. 31, 1998
BALANCE SHEETS DEC. 31, 1997
ASSETS (thousands)
<S> <C> <C>
- -------------------------------------------------------------------------------------------------
Investments:
Fixed maturities:
Held to maturity, at amortized cost (fair value: 1998, $503,909;
1997, $562,979).................................................. $ 473,592 $ 535,651
Available for sale, at fair value (amortized cost: 1998,
$561,325; 1997, $582,962)........................................ 578,591 603,576
Mortgage loans on real estate.................................... 166,835 178,826
Policy loans..................................................... 25,421 23,349
Other investments................................................ 566 970
- -------------------------------------------------------------------------------------------------
Total investments................................................ 1,245,005 1,342,372
- -------------------------------------------------------------------------------------------------
Cash and cash equivalents........................................ 3,007 --
Amounts recoverable from reinsurers.............................. 4,077 2,317
Accounts receivable.............................................. 842 723
Premiums due..................................................... 204 192
Accrued investment income........................................ 19,893 20,205
Deferred policy acquisition costs................................ 129,477 126,614
Other assets..................................................... 1,042 995
Separate account assets.......................................... 1,491,679 1,236,759
- -------------------------------------------------------------------------------------------------
Total assets..................................................... $ 2,895,226 $ 2,730,177
- -------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDER'S EQUITY
<S> <C> <C>
- -------------------------------------------------------------------------------------------------
Liabilities:
Future policy benefits:
Fixed annuities.................................................. $ 875,507 $ 964,483
Universal life-type insurance.................................... 152,195 147,744
Traditional life, disability income and long-term care
insurance........................................................ 55,910 50,469
Policy claims and other policyholders' funds..................... 3,105 4,013
Deferred income taxes............................................ 7,912 11,445
Amounts due to brokers........................................... 4,507 29,054
Other liabilities................................................ 24,945 28,931
Separate account liabilities..................................... 1,491,679 1,236,759
- -------------------------------------------------------------------------------------------------
Total liabilities................................................ 2,615,760 2,472,898
- -------------------------------------------------------------------------------------------------
Stockholder's equity:
Capital stock, $10 par value per share; 200,000 shares
authorized, issued and outstanding............................... 2,000 2,000
Additional paid-in capital....................................... 49,000 49,000
Accumulated other comprehensive income:
Net unrealized securities gains.................................. 11,014 13,175
Retained earnings................................................ 217,452 193,104
- -------------------------------------------------------------------------------------------------
Total stockholder's equity....................................... 279,466 257,279
- -------------------------------------------------------------------------------------------------
Total liabilities and stockholder's equity....................... $ 2,895,226 $ 2,730,177
- -------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-1
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED DEC. 31,
1998 1997 1996
STATEMENTS OF INCOME (thousands)
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------
Revenues:
Traditional life, disability income and long-term care insurance
premiums......................................................... $ 13,852 $ 12,376 $ 10,931
Policyholder and contractholder charges.......................... 20,467 18,319 15,832
Mortality and expense risk fees.................................. 13,980 11,312 8,574
Net investment income............................................ 100,871 106,274 109,468
Net realized gains (losses) on investments....................... 2,163 547 (1,424)
- --------------------------------------------------------------------------------------------------------
Total revenues................................................... 151,333 148,828 143,381
- --------------------------------------------------------------------------------------------------------
Benefits and expenses:
Death and other benefits: Traditional life, disability income and
long-term care insurance......................................... 5,553 3,633 4,182
Universal life-type insurance and investment contracts........... 4,320 3,852 4,409
Increase in liabilities for future policy benefits for
traditional life, disability income and long-term care
insurance........................................................ 3,662 3,979 2,324
Interest credited on universal life-type insurance and investment
contracts........................................................ 55,073 62,294 65,099
Amortization of deferred policy acquisition costs................ 18,362 17,201 16,071
Other insurance and operating expenses........................... 8,917 10,220 8,972
- --------------------------------------------------------------------------------------------------------
Total benefits and expenses...................................... 95,887 101,179 101,057
- --------------------------------------------------------------------------------------------------------
Income before income taxes....................................... 55,446 47,649 42,324
Income taxes..................................................... 19,098 16,471 14,640
- --------------------------------------------------------------------------------------------------------
Net income....................................................... $ 36,348 $ 31,178 $ 27,684
- --------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-2
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
THREE YEARS ENDED DEC. 31, 1998
(thousands) ACCUMULATED
OTHER
TOTAL COMPREHENSIVE
STOCKHOLDER'S CAPITAL INCOME, RETAINED
STATEMENTS OF STOCKHOLDER'S EQUITY EQUITY STOCK ADDITIONAL NET OF TAX EARNINGS
PAID-IN
CAPITAL
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
Balance, Dec. 31, 1995.................................... $218,583 $ 2,000 $ 49,000 $15,341 $ 152,242
Comprehensive income:
Net income............................................ 27,684 -- -- -- 27,684
Unrealized holding losses arising during the year, net
of effect on deferred policy acquisition costs of $296
and taxes of $5,055................................... (9,387) -- -- (9,387 ) --
Reclassification adjustment for losses included in net
income, net of tax of $(530).......................... 983 -- -- 983 --
------- ----------
Other comprehensive loss.................................. (8,404) -- -- (8,404 ) --
-------
Comprehensive income...................................... 19,280
Cash dividends to parent.................................. (8,000) -- -- -- (8,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1996.................................... 229,863 2,000 49,000 6,937 171,926
Comprehensive income:
Net income............................................ 31,178 -- -- -- 31,178
Unrealized holding gains arising during the year, net
of effect on deferred policy acquisition costs of $(1)
and taxes of $(3,412)................................. 6,337 -- -- 6,337 --
Reclassification adjustment for gains included in net
income, net of tax of $54............................. (99) -- -- (99 ) --
------- ----------
Other comprehensive income................................ 6,238 -- -- 6,238 --
-------
Comprehensive income...................................... 37,416
Cash dividends to parent.................................. (10,000) -- -- -- (10,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1997.................................... 257,279 2,000 49,000 13,175 193,104
Comprehensive income:
Net income............................................ 36,348 -- -- -- 36,348
Unrealized holding losses arising during the year, net
of effect on deferred policy acquisition costs of $22
and taxes of $1,415................................... (2,628) -- -- (2,628 ) --
Reclassification adjustment for gains included in net
income, net of tax of $(252).......................... 467 -- -- 467 --
------- ----------
Other comprehensive loss.................................. (2,161) -- -- (2,161 ) --
-------
Comprehensive income...................................... 34,187
Cash dividends to parent.................................. (12,000) -- -- -- (12,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1998.................................... $279,466 $ 2,000 $ 49,000 $11,014 $ 217,452
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-3
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED DEC. 31,
1998 1997 1996
STATEMENTS OF CASH FLOWS (thousands)
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income....................................................... $ 36,348 $ 31,178 $ 27,684
Adjustments to reconcile net income to net cash provided by
operating activities:
Policy loan issuance, excluding universal life-type insurance.... (3,110) (3,073) (2,473)
Policy loan repayment, excluding universal life-type insurance... 2,660 1,897 1,571
Change in accrued investment income.............................. 312 863 1,504
Change in amounts recoverable from reinsurer..................... (1,760) (1,345) (460)
Change in premiums due........................................... (12) (50) 25
Change in accounts receivable.................................... (119) 218 (83)
Change in other assets........................................... (47) (95) (328)
Change in deferred policy acquisition costs, net................. (2,841) (7,431) (9,087)
Change in liabilities for future policy benefits for traditional
life, disability income and long-term care insurance............. 5,441 5,131 2,861
Change in policy claims and other policyholders' funds........... (908) 858 (489)
Deferred income tax benefit...................................... (2,369) (960) (2,095)
Change in other liabilities...................................... (3,986) 3,468 4,434
Accretion of discount, net....................................... (342) (352) (652)
Net realized (gain) loss on investments.......................... (2,163) (547) 1,424
Policyholder and contractholder charges, non-cash................ (9,661) (8,772) (7,831)
Other, net....................................................... 118 715 (935)
- ---------------------------------------------------------------------------------------------------------
Net cash provided by operating activities........................ 17,561 21,703 15,070
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Fixed maturities held to maturity:
Maturities, sinking fund payments and calls...................... 46,629 36,511 39,082
Sales............................................................ 16,173 12,616 14,465
Fixed maturities available for sale:
Purchases........................................................ (86,072) (101,818) (97,370)
Maturities, sinking fund payments and calls...................... 96,578 84,229 71,939
Sales............................................................ 13,180 27,055 15,669
Other investments, excluding policy loans:
Purchases........................................................ (9,121) (33,243) (14,802)
Sales............................................................ 21,113 14,233 12,659
Change in amounts due from broker................................ -- 995 --
Change in amounts due to broker.................................. (24,547) 26,047 (6,993)
- ---------------------------------------------------------------------------------------------------------
Net cash provided by investing activities........................ 73,933 66,625 34,649
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Activity related to universal life-type insurance and investment
contracts:
Considerations received.......................................... 76,009 112,732 131,011
Surrenders and death benefits.................................... (205,946) (251,259) (236,689)
Interest credited to account balances............................ 55,073 62,294 65,099
Universal life-type insurance policy loans:
Issuance......................................................... (5,222) (4,848) (4,490)
Repayment........................................................ 3,599 2,753 3,350
Cash dividend to parent.......................................... (12,000) (10,000) (8,000)
- ---------------------------------------------------------------------------------------------------------
Net cash used in financing activities............................ (88,487) (88,328) (49,719)
- ---------------------------------------------------------------------------------------------------------
Net increase in cash and cash equivalents........................ 3,007 -- --
Cash and cash equivalents at beginning of year................... -- -- --
- ---------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year......................... $ 3,007 $ -- $ --
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-4
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS)
- -----------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS
IDS Life Insurance Company of New York (the Company) is engaged in the insurance
and annuity business in the state of New York. The Company's principal products
are deferred annuities and universal life insurance which are issued primarily
to individuals. It offers single premium and flexible premium deferred annuities
on both a fixed and variable dollar basis. Immediate annuities are offered as
well. The Company's insurance products include universal life (fixed and
variable), whole life, single premium life and term products (including waiver
of premium and accidental death benefits). The Company also markets disability
income and long-term care insurance.
BASIS OF PRESENTATION
The Company is a wholly owned subsidiary of IDS Life Insurance Company (IDS
Life), which is a wholly owned subsidiary of American Express Financial
Corporation (AEFC), which is a wholly owned subsidiary of American Express
Company. The accompanying financial statements have been prepared in conformity
with generally accepted accounting principles which vary in certain respects
from reporting practices prescribed or permitted by the New York Department of
Insurance as reconciled in Note 11.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
INVESTMENTS
Fixed maturities that the Company has both the positive intent and the ability
to hold to maturity are classified as held to maturity and carried at amortized
cost. All other fixed maturities and all marketable equity securities are
classified as available for sale and carried at fair value. Unrealized gains and
losses on securities classified as available for sale are reported as a separate
component of accumulated other comprehensive income, net of deferred policy
acquisition costs and deferred income taxes.
Realized investment gains or losses are determined on an identified cost basis.
Prepayments are anticipated on certain investments in mortgage-backed securities
in determining the constant effective yield used to recognize interest income.
Prepayment estimates are based on information received from brokers who deal in
mortgage-backed securities.
Mortgage loans on real estate are carried at amortized cost less reserves for
mortgage loan losses. The estimated fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage interest rates
currently offered for mortgages of similar maturities.
F-5
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Impairment of mortgage loans is measured as the excess of the loan's recorded
investment over its present value of expected principal and interest payments
discounted at the loan's effective interest rate, or the fair value of
collateral. The amount of the impairment is recorded in an allowance for
mortgage loan losses. The allowance for mortgage loan losses is maintained at a
level that management believes is adequate to absorb estimated losses in the
portfolio. The level of the allowance account is determined based on several
factors, including historical experience, expected future principal and interest
payments, estimated collateral values, and current and anticipated economic and
political conditions. Management regularly evaluates the adequacy of the
allowance for mortgage loan losses.
The Company generally stops accruing interest on mortgage loans for which
interest payments are delinquent more than three months. Based on management's
judgment as to the ultimate collectibility of principal, interest payments
received are either recognized as income or applied to the recorded investment
in the loan.
The cost of interest rate caps is amortized to investment income over the life
of the contracts and payments received as a result of these agreements are
recorded as investment income when realized. The amortized cost of interest rate
caps is included in other investments.
Policy loans are carried at the aggregate of the unpaid loan balances which do
not exceed the cash surrender values of the related policies.
When evidence indicates a decline, which is other than temporary, in the
underlying value or earning power of individual investments, such investments
are written down to the fair value by a charge to income.
STATEMENTS OF CASH FLOWS
The Company considers investments with a maturity at the date of their
acquisition of three months or less to be cash equivalents. These securities are
carried principally at amortized cost which approximates fair value.
Supplementary information to the statements of cash flows for the years ended
December 31 is summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
CASH PAID DURING THE YEAR FOR:
Income taxes....................... $22,470 $17,811 $15,247
Interest on borrowings............. 1,600 1,026 777
- --------------------------------------------------------------
</TABLE>
RECOGNITION OF PROFITS ON ANNUITY
CONTRACTS AND INSURANCE POLICIES
Profits on fixed deferred annuities are recognized by the Company over the lives
of the contracts, using primarily the interest method. Profits represent the
excess of investment income earned from investment of contract considerations
over interest credited to contract owners and other expenses.
The retrospective deposit method is used in accounting for universal life-type
insurance. This method recognizes profits over the lives of the policies in
proportion to the estimated gross profits expected to be realized.
F-6
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Premiums on traditional life, disability income and long-term care insurance
policies are recognized as revenue when due, and related benefits and expenses
are associated with premium revenue in a manner that results in recognition of
profits over the lives of the insurance policies. This association is
accomplished by means of the provision for future policy benefits and the
deferral and subsequent amortization of policy acquisition costs.
Policyholder and contractholder charges include the monthly cost of insurance
charges, issue and administrative fees and surrender charges. These charges also
include the minimum death benefit guarantee fees received from the variable life
insurance separate accounts. Mortality and expense fees are received from the
variable annuity and variable life insurance separate accounts.
DEFERRED POLICY ACQUISITION COSTS
The costs of acquiring new business, principally sales compensation, policy
issue costs, underwriting and certain sales expenses, have been deferred on
insurance and annuity contracts. The deferred acquisition costs for most single
premium deferred annuities and installment annuities are amortized primarily
using the interest method. The costs for universal life-type insurance and
certain installment annuities are amortized as a percentage of the estimated
gross profits expected to be realized on the policies. For traditional life,
disability income and long-term care insurance policies, the costs are amortized
over an appropriate period in proportion to premium revenue.
LIABILITIES FOR FUTURE POLICY BENEFITS
Liabilities for universal life-type insurance and deferred annuities are
accumulation values.
Liabilities for fixed annuities in a benefit status are based on mortality
tables with various interest rates ranging from 5% to 9.5%, depending on year of
issue.
Liabilities for future benefits on traditional life insurance are based on the
net level premium method, using anticipated mortality, policy persistency and
interest earning rates. Anticipated mortality rates are based on established
industry mortality tables. Anticipated policy persistency rates vary by policy
form, issue age and policy duration with persistency on cash value plans
generally anticipated to be better than persistency on term insurance plans.
Anticipated interest rates range from 4% to 10%, depending on policy form, issue
year and policy duration.
Liabilities for future disability income and long-term care policy benefits
include both policy reserves and claim reserves. Policy reserves are based on
the net level premium method, using anticipated morbidity, mortality, policy
persistency and interest earning rates. Anticipated morbidity and mortality
rates are based on established industry morbidity and mortality tables.
Anticipated policy persistency rates vary by policy form, issue age, policy
duration and, for disability income policies, occupation class. Anticipated
interest rates for disability income and long-term care policy reserves are 3%
to 9.5% at policy issue and grade to ultimate rates of 5% to 7% over 4 to 10
years.
Claim reserves are calculated based on claim continuance tables and anticipated
interest earnings. Anticipated claim continuance rates are based on established
industry tables. Anticipated interest rates for claim reserves for both
disability income and long-term care range from 6% to 8%.
F-7
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
REINSURANCE
The maximum amount of life insurance risk retained by the Company on any one
life is $750 of life benefit plus $50 of accidental death benefits. The maximum
amount of life insurance risk retained on any joint-life combination is $1,500.
The excesses are reinsured with other life insurance companies, primarily on a
yearly renewable term basis. Long-term care policies are primarily reinsured on
a coinsurance basis. Beginning in 1998, the Company retains all disability
income and waiver of premium risk.
FEDERAL INCOME TAXES
The Company's taxable income is included in the consolidated federal income tax
return of American Express Company. The Company provides for income taxes on a
separate return basis, except that, under an agreement between AEFC and American
Express Company, tax benefit is recognized for losses to the extent they can be
used on the consolidated tax return. It is the policy of AEFC and its
subsidiaries that AEFC will reimburse subsidiaries for all tax benefits.
Included in other liabilities at December 31, 1998 and 1997 are $3,647, and
$5,026, respectively, payable to IDS Life for federal income taxes.
SEPARATE ACCOUNT BUSINESS
The separate account assets and liabilities represent funds held for the
exclusive benefit of the variable annuity and variable life insurance contract
owners. The Company receives mortality and expense risk fees from the variable
annuity separate accounts.
The Company makes contractual mortality assurances to the variable annuity
contract owners that the net assets of the separate accounts will not be
affected by future variations in the actual life expectancy experience of the
annuitants and beneficiaries from the mortality assumptions implicit in the
annuity contracts. The Company makes periodic fund transfers to, or withdrawals
from, the separate accounts for such actuarial adjustments for variable
annuities that are in the benefit payment period. The Company also guarantees
that the rates at which administrative fees are deducted from contract funds
will not exceed contractual maximums.
For variable life insurance, the Company guarantees that the rates at which
insurance charges and administrative fees are deducted from contract funds will
not exceed contractual maximums. The Company also guarantees that the death
benefit will continue payable at the initial level regardless of investment
performance so long as minimum premium payments are made.
ACCOUNTING CHANGES
Effective January 1, 1998, the Company adopted SFAS No. 130, "Reporting
Comprehensive Income." SFAS No. 130 requires the reporting and display of
comprehensive income and its components. Comprehensive income is defined as the
aggregate change in stockholder's equity excluding changes in ownership
interests. For the Company, it is net income and the unrealized gains or losses
on available-for-sale securities net of the effect on deferred policy acquistion
costs, of taxes and reclassification adjustment.
F-8
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In March 1998, the American Institute of Certified Public Accountants (AICPA)
issued Statement of Position (SOP) 98-1, "Accounting for Costs of Computer
Software Developed or Obtained for Internal Use." The SOP, which is effective
January 1, 1999, requires the capitalization of certain costs incurred after the
date of adoption to develop or obtain software for internal use. Software
utilized by the Company is owned by AEFC and will be capitalized on AEFC's
financial statements. As a result, the new rule will not have a material impact
on the Company's results of operations or financial condition.
In December 1997, the AICPA issued SOP 97-3, "Accounting by Insurance and Other
Enterprises for Insurance-Related Assessments," providing guidance for the
timing of recognition of liabilities related to guaranty fund assessments. The
Company will adopt the SOP on January 1, 1999. The Company has historically
carried a balance in other liabilities on the balance sheet for potential
guaranty fund assessment exposure. Adoption of the SOP will not have a material
impact on the Company's results of operations or financial condition
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which is effective January 1, 2000. This
Statement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires that an entity recognize all
derivatives as either assets or liabilities in the balance sheet and measure
those instruments at fair value. The accounting for changes in the fair value of
a derivative depends on the intended use of the derivative and the resulting
designation. Earlier application of all of the provisions of this Statement is
encouraged, but it is permitted only as of the beginning of any fiscal quarter
that begins after issuance of the Statement. This Statement cannot be applied
retroactively. The ultimate financial impact of the new rule will be measured
based on the derivatives in place at adoption and cannot be estimated at this
time.
RECLASSIFICATIONS
Certain 1997 and 1996 amounts have been reclassified to conform to the 1998
presentation.
F-9
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS
Fair values of investments in fixed maturities represent quoted market prices
and estimated values when quoted prices are not available. Estimated values are
determined by established procedures involving, among other things, review of
market indices, price levels of current offerings of comparable issues, price
estimates and market data from independent brokers and financial files.
The amortized cost, gross unrealized gains and losses and fair value of
investments in fixed maturities at December 31, 1998 are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
HELD TO MATURITY COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
U.S. Government agency
obligations................... $ 2,871 $ 159 $ -- $ 3,030
Corporate bonds and
obligations................... 417,648 29,795 474 446,969
Mortgage-backed securities.... 53,073 844 7 53,910
- -----------------------------------------------------------------------------------
$473,592 $30,798 $ 481 $ 503,909
- -----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
AVAILABLE FOR SALE COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
State and municipal
obligations................... $ 105 $ 9 $ -- $ 114
Corporate bonds and
obligations................... 336,985 15,939 6,296 346,628
Mortgage-backed securities.... 224,235 7,614 -- 231,849
- -----------------------------------------------------------------------------------
$561,325 $23,562 $6,296 $ 578,591
- -----------------------------------------------------------------------------------
</TABLE>
The amortized cost, gross unrealized gains and losses and fair value of
investments in fixed maturities at December 31, 1997 are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
HELD TO MATURITY COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
U.S. Government agency
obligations................... $ 3,690 $ 253 $ -- $ 3,943
Corporate bonds and
obligations................... 476,108 27,361 444 503,025
Mortgage-backed securities.... 55,853 452 294 56,011
- -----------------------------------------------------------------------------------
$535,651 $28,066 $ 738 $ 562,979
- -----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
AVAILABLE FOR SALE COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
State and municipal
obligations................... $ 104 $ 10 $ -- $ 114
Corporate bonds and
obligations................... 281,555 14,272 1,635 294,192
Mortgage-backed securities.... 301,303 8,253 286 309,270
- -----------------------------------------------------------------------------------
$582,962 $22,535 $1,921 $ 603,576
- -----------------------------------------------------------------------------------
</TABLE>
F-10
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
The amortized cost and fair value of investments in fixed maturities at December
31, 1998 by contractual maturity are shown below. Expected maturities will
differ from contractual maturities because borrowers may have the right to call
or prepay obligations with or without call or prepayment penalties.
<TABLE>
<CAPTION>
AMORTIZED FAIR
HELD TO MATURITY COST VALUE
<S> <C> <C>
- ----------------------------------------------------------------
Due in one year or less................. $ 22,671 $ 22,908
Due from one to five years.............. 152,766 162,929
Due from five to ten years.............. 183,198 195,428
Due in more than ten years.............. 61,884 68,733
Mortgage-backed securities.............. 53,073 53,911
- ----------------------------------------------------------------
$473,592 $ 503,909
- ----------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AMORTIZED FAIR
AVAILABLE FOR SALE COST VALUE
<S> <C> <C>
- ----------------------------------------------------------------
Due in one year or less................. $ 8,512 $ 8,716
Due from one to five years.............. 40,511 43,188
Due from five to ten years.............. 191,185 197,625
Due in more than ten years.............. 96,881 97,213
Mortgage-backed securities.............. 224,236 231,849
- ----------------------------------------------------------------
$561,325 $ 578,591
- ----------------------------------------------------------------
</TABLE>
During the years ended December 31, 1998, 1997 and 1996, fixed maturities
classified as held to maturity were sold with amortized cost of $16,175, $12,737
and $14,507, respectively. Net gains and losses on these sales were not
significant. The sale of these fixed maturities was due to significant
deterioration in the issuers' creditworthiness.
Fixed maturities available for sale were sold during 1998 with proceeds of
$13,180 and gross realized gains and losses of $1,159 and $440, respectively.
Fixed maturities available for sale were sold during 1997 with proceeds of
$27,055 and gross realized gains and losses of $461 and $309, respectively.
Fixed maturities available for sale were sold during 1996 with proceeds of
$15,669 and gross realized gains and losses of $28 and $1,541, respectively.
At December 31, 1998, bonds carried at $257 were on deposit with the state of
New York as required by law.
F-11
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998, investments in fixed maturities comprised 85 percent of
the Company's total invested assets. These securities are rated by Moody's and
Standard & Poor's (S&P), except for securities carried at approximately $153
million which are rated by AEFC internal analysts using criteria similar to
Moody's and S&P. A summary of investments in fixed maturities, at amortized
cost, by rating on December 31 is as follows:
<TABLE>
<CAPTION>
RATING 1998 1997
<S> <C> <C>
- ----------------------------------------------------------------
Aaa/AAA................................. $ 280,669 $ 367,242
Aa/AA................................... 15,815 9,685
Aa/A.................................... 16,327 13,646
A/A..................................... 151,838 162,275
A/BBB................................... 68,640 81,463
Baa/BBB................................. 366,776 343,519
Baa/BB.................................. 39,666 21,519
Below investment grade.................. 95,186 119,264
- ----------------------------------------------------------------
$1,034,917 $1,118,613
- ----------------------------------------------------------------
</TABLE>
F-12
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998, 98 percent of the securities rated Aaa/AAA are GNMA, FNMA
and FHLMC mortgage-backed securities. No holdings of any other issuer are
greater than one percent of the Company's total investments in fixed maturities.
At December 31, 1998, approximately 13 percent of the Company's investments were
mortgage loans on real estate. Summaries of mortgage loans by region of the
United States and by type of real estate are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1998 DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
REGION SHEET TO PURCHASE SHEET TO PURCHASE
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------
West North Central............ $ 24,725 $ -- $ 27,833 $ --
East North Central............ 29,134 59 33,515 --
South Atlantic................ 34,175 598 34,182 2,750
Middle Atlantic............... 18,350 -- 24,485 --
Pacific....................... 9,706 -- 9,873 --
Mountain...................... 36,636 -- 32,864 6,417
New England................... 7,851 -- 8,624 --
East South Central............ 7,521 -- 8,698 --
West South Central............ 237 -- 252 --
- ---------------------------------------------------------------------------------------
168,335 657 180,326 9,167
Less allowance for losses..... 1,500 -- 1,500 --
- ---------------------------------------------------------------------------------------
$166,835 $657 $178,826 $9,167
- ---------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1998 DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
PROPERTY TYPE SHEET TO PURCHASE SHEET TO PURCHASE
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------
Apartments.................... $ 59,019 $ -- $ 68,823 $ --
Department/retail stores...... 54,018 624 54,622 6,417
Office buildings.............. 23,902 -- 25,042 1,650
Industrial buildings.......... 18,590 33 17,975 1,100
Nursing/retirement............ 5,153 -- 6,035 --
Medical buildings............. 7,416 -- 7,577 --
Hotels/motels................. 237 -- 252 --
- ---------------------------------------------------------------------------------------
168,335 657 180,326 9,167
Less allowance for losses..... 1,500 -- 1,500 --
- ---------------------------------------------------------------------------------------
$166,835 $657 $178,826 $9,167
- ---------------------------------------------------------------------------------------
</TABLE>
Mortgage loan fundings are restricted by state insurance regulatory authority to
80 percent or less of the market value of the real estate at the time of
origination of the loan. The Company holds the mortgage document, which gives it
the right to take possession of the property if the borrower fails to perform
according to the terms of the agreement. The fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage interest rates
currently offered for mortgages of similar maturities. Commitments to purchase
mortgages are made in the ordinary course of business. The fair value of the
mortgage commitments is $nil.
F-13
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998 and 1997, the Company's recorded investment in impaired
loans was $1,268 and $1,299, with allowances of $300 and $300, respectively.
During 1998 and 1997, the average recorded investment in impaired loans was
$1,282 and $1,312, respectively.
The Company recognized $123, $126 and $152 of interest income related to
impaired loans for the years ended December 31, 1998, 1997 and 1996,
respectively.
The following table presents changes in the allowance for investment losses
related to all loans:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -----------------------------------------------------------
Balance, January 1................. $1,500 $1,300 $ 445
Provision for investment losses.... -- 200 855
- -----------------------------------------------------------
Balance, December 31............... $1,500 $1,500 $1,300
- -----------------------------------------------------------
</TABLE>
Net investment income for the years ended December 31 is summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -----------------------------------------------------------------
Interest on fixed maturities....... $ 85,164 $ 92,007 $ 95,574
Interest on mortgage loans......... 14,599 14,228 14,171
Other investment income............ 3,365 1,715 1,293
Interest on cash equivalents....... 64 91 67
- -----------------------------------------------------------------
103,192 108,041 111,105
Less investment expenses........... 2,321 1,767 1,637
- -----------------------------------------------------------------
$100,871 $106,274 $109,468
- -----------------------------------------------------------------
</TABLE>
Net realized gains (losses) on investments for the years ended December 31 is
summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -------------------------------------------------------------
Fixed maturities................... $2,018 $ 844 $ (572)
Mortgage loans..................... -- (200) (855)
Other investments.................. 145 (97) 3
- -------------------------------------------------------------
$2,163 $ 547 $(1,424)
- -------------------------------------------------------------
</TABLE>
Changes in net unrealized appreciation (depreciation) of investments for the
years ended December 31 are summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
Fixed maturities available for
sale............................... $(3,347) $9,599 $(13,215)
- --------------------------------------------------------------
</TABLE>
F-14
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
3. INCOME TAXES
The Company qualifies as a life insurance company for federal income tax
purposes. As such, the Company is subject to the
Internal Revenue Code provisions applicable to life insurance companies.
The income tax expense (benefit) for the years ending December 31 consists of
the following:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
Federal income taxes:
Current............................ $20,192 $16,371 $15,735
Deferred........................... (2,369) (960) (2,095)
- --------------------------------------------------------------
17,823 15,411 13,640
State income taxes-current......... 1,275 1,060 1,000
- --------------------------------------------------------------
Income tax expense................. $19,098 $16,471 $14,640
- --------------------------------------------------------------
</TABLE>
Increases (decreases) to the federal tax provision applicable to pretax income
based on the statutory rate are attributable to:
<TABLE>
<CAPTION>
1998 1997 1996
- -----------------------------------------------------------------------------------------------
PROVISION RATE PROVISION RATE PROVISION RATE
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Federal income taxes
based on the statutory
rate..................... $19,406 35.0% $16,677 35.0% $14,813 35.0%
Increases (decreases) are
attributable to:
Tax-excluded interest and
dividend income.......... (660) (1.2) (569) (1.2) (458) (1.1)
State tax, net of federal
benefit.................. 829 1.5 689 1.4 650 1.5
Other, net............... (477) (0.9) (326) (0.6) (365) (0.8)
- -----------------------------------------------------------------------------------------------
Federal income taxes..... $19,098 34.4% $16,471 34.6% $14,640 34.6%
- -----------------------------------------------------------------------------------------------
</TABLE>
A portion of life insurance company income earned prior to 1984 was not subject
to current taxation but was accumulated, for tax purposes, in a "policyholders'
surplus account." At December 31, 1998, the Company had a policyholders' surplus
account balance of $798. The policyholders' surplus account is only taxable if
dividends to the stockholder exceed the stockholder's surplus account or if the
Company is liquidated. Deferred income taxes of $279 have not been established
because no distributions of such amounts are contemplated.
Significant components of the Company's deferred income tax assets and
liabilities as of December 31 are as follows:
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
- ----------------------------------------------------------
Deferred income tax assets:
Policy reserves......................... $29,318 $28,922
Other................................... 6,502 5,467
- ----------------------------------------------------------
Total deferred income tax assets........ 35,820 34,389
- ----------------------------------------------------------
Deferred income tax liabilities:
Deferred policy acquisition costs....... 36,673 36,594
Investments............................. 7,059 9,240
- ----------------------------------------------------------
Total deferred income tax liabilities... 43,732 45,834
- ----------------------------------------------------------
Net deferred income tax liabilities..... $ 7,912 $11,445
- ----------------------------------------------------------
</TABLE>
F-15
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
3. INCOME TAXES (CONTINUED)
The Company is required to establish a valuation allowance for any portion of
the deferred income tax assets that management believes will not be realized. In
the opinion of management, it is more likely than not that the Company will
realize the benefit of the deferred tax assets and, therefore, no such valuation
allowance has been established.
- --------------------------------------------------------------------------------
4. STOCKHOLDER'S EQUITY
Retained earnings available for distribution as dividends to the parent are
limited to the Company's surplus as determined in accordance with accounting
practices prescribed by the New York Department of Insurance. All dividend
distributions must be approved by the New York Department of Insurance.
Statutory unassigned surplus aggregated $132,702 and $115,828 as of December 31,
1998 and 1997, respectively (see Note 3 with respect to the income tax effect of
certain distributions and Note 11 for a reconciliation of net income and
stockholder's equity per the accompanying financial statements to statutory net
income and surplus).
- --------------------------------------------------------------------------------
5. BENEFIT PLANS
The Company participates in the American Express Company Retirement Plan which
covers all permanent employees age 21 and over who have met certain employment
requirements. Employer contributions to the plan are based on participants' age,
years of service and total compensation for the year. Funding of retirement
costs for this plan complies with the applicable minimum funding requirements
specified by ERISA. The Company's share of the total net periodic pension cost
was $37, $39 and $34 in 1998, 1997 and 1996, respectively.
The Company has a "Sales Benefit Plan" which is an unfunded, noncontributory
retirement plan for all eligible financial advisors. Total plan costs for 1998,
1997 and 1996, which are calculated on the basis of commission earnings of the
individual financial advisors, were $1,480, $1,965 and $1,474, respectively.
Such costs are included in deferred policy acquisition costs.
The Company also participates in defined contribution pension plans of American
Express Company which cover all employees who have met certain employment
requirements. Company contributions to the plans are a percent of either each
employee's eligible compensation or basic contributions. Costs of these plans
charged to operations in 1998, 1997 and 1996 were $252, $312 and $248,
respectively.
The Company participates in defined benefit health care plans of AEFC that
provide health care and life insurance benefits to retired employees and retired
financial advisors. The plans include participant contributions and
service-related eligibility requirements. Upon retirement, such employees are
considered to have been employees of AEFC. Costs of these plans charged to
operations in 1998, 1997 and 1996 were $nil.
F-16
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
6. INCENTIVE PLAN AND RELATED PARTY OPERATING EXPENSES
The Company maintains a "Persistency Payment Plan." Under the terms of this
plan, financial advisors earn additional compensation based on the volume and
persistency of insurance sales. The total costs for the plan for 1998, 1997 and
1996 were $140, $1,490 and $1,424, respectively. Such costs are included in
deferred policy acquisition costs.
Charges by IDS Life and AEFC for the use of joint facilities, marketing services
and other services aggregated $9,403, $11,589 and $12,389 for 1998, 1997 and
1996, respectively. Certain of these costs are included in deferred policy
acquisition costs.
- --------------------------------------------------------------------------------
7. COMMITMENTS AND CONTINGENCIES
A number of lawsuits have been filed against life and health insurers in
jurisdictions in which the Company conducts business involving insurers' sales
practices, alleged agent misconduct, failure to properly supervise agents, and
other matters. The Company, along with AEFC and its insurance subsidiaries, has
been named as a defendant in one of these types of actions.
The plaintiffs purport to represent a class consisting of all persons who
purchased policies or contracts from IDS Life and its subsidiaries. The
complaint puts at issue various alleged sales practices and misrepresentations,
alleged breaches of fiduciary duties and alleged violations of consumer fraud
statutes. IDS Life and its subsidiaries believe they have meritorious defenses
to the claims raised in this lawsuit.
The outcome of any litigation cannot be predicted with certainty. In the opinion
of management, however, the ultimate resolution of this lawsuit should not have
a material adverse effect on the Company's financial position.
At December 31, 1998 and 1997, traditional life insurance and universal
life-type insurance in force aggregated $4,941,727 and $4,513,251, respectively,
of which $248,280 and $221,798 were reinsured at the respective year ends.
In addition, the Company has a stop loss reinsurance agreement with IDS Life
covering ordinary life benefits. IDS Life agrees to pay all death benefits
incurred each year which exceed 125 percent of normal claims, where normal
claims are defined in the agreement as .095 percent of the mean retained life
insurance in force. Premiums ceded to IDS Life amounted to $74, $115 and $98 for
the years ended December 31, 1998, 1997 and 1996, respectively. Claim recoveries
under the terms of this reinsurance agreement were $nil, $963 and $861 in 1998,
1997 and 1996, respectively.
Premiums ceded to reinsurers other than IDS Life amounted to $2,178, $1,583 and
$747 for the years ended December 31, 1998, 1997 and 1996, respectively. Claim
recoveries from reinsurers other than IDS Life amounted to $228, $1,366 and $66
for the years ended December 31, 1998, 1997 and 1996, respectively.
Reinsurance contracts do not relieve the Company from its primary obligations to
policyholders.
The Company has an agreement to assume a block of extended term life insurance
business. The amount of insurance in force related to this agreement was
$267,806 and $303,263 at December 31, 1998 and 1997, respectively. The
accompanying statement of income includes premiums of $nil for the years ended
December 31, 1998, 1997 and 1996, and decreases in liabilities for future policy
benefits of $1,742, $1,889 and $2,010 related to this agreement for the years
ended December 31, 1998, 1997 and 1996, respectively.
F-17
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
8. LINES OF CREDIT
The Company has an available line of credit with AEFC aggregating $25,000. The
interest rate for the line of credit is AEFC's cost of funds, ranging from 20 to
45 basis points over an established index. There were no borrowings outstanding
under this agreement at December 31, 1998 or 1997.
- --------------------------------------------------------------------------------
9. DERIVATIVE FINANCIAL INSTRUMENTS
The Company enters into transactions involving derivative financial instruments
to manage its exposure to interest rate risk, including hedging specific
transactions. The Company does not hold derivative instruments for trading
purposes. The Company manages risks associated with these instruments as
described below.
Market risk is the possibility that the value of the derivative financial
instruments will change due to fluctuations in a factor from which the
instrument derives its value, primarily an interest rate. The Company is not
impacted by market risk related to derivatives held for non-trading purposes
beyond that inherent in cash market transactions. Derivatives are largely used
to manage risk and, therefore, the cash flow and income effects of the
derivatives are inverse to the effects of the underlying transactions.
Credit risk is the possibility that the counterparty will not fulfill the terms
of the contract. The Company monitors credit risk related to derivative
financial instruments through established approval procedures, including setting
concentration limits by counterparty and industry, and requiring collateral,
where appropriate. A vast majority of the Company's counterparties are rated A
or better by Moody's and Standard & Poor's.
Credit risk related to interest rate caps is measured by replacement cost of the
contracts. The replacement cost represents the fair value of the instruments.
The notional or contract amount of a derivative financial instrument is
generally used to calculate the cash flows that are received or paid over the
life of the agreement. Notional amounts are not recorded on the balance sheet.
Notional amounts far exceed the related credit exposure.
The Company's holdings of derivative financial instruments are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1998 NOTIONAL CARRYING FAIR TOTAL CREDIT
ASSETS: AMOUNT AMOUNT VALUE EXPOSURE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------
Assets:
Interest rate caps............ $200,000 $566 $ 2 $ 2
- ----------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1997 NOTIONAL CARRYING FAIR TOTAL CREDIT
ASSETS: AMOUNT AMOUNT VALUE EXPOSURE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------
Assets:
Interest rate caps............ $200,000 $970 $62 $62
- ----------------------------------------------------------------------------
</TABLE>
The fair values of derivative financial instruments are based on market values,
dealer quotes or pricing models. The interest rate caps expire in the year 2000.
Interest rate caps are used to manage the Company's exposure to interest rate
risk. These instruments are used primarily to protect the margin between
interest rates earned on investments and the interest rates credited to related
annuity contract holders.
F-18
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
10. FAIR VALUES OF FINANCIAL INSTRUMENTS
The Company discloses fair value information for most on- and off-balance sheet
financial instruments for which it is practicable to estimate that value. Fair
values of life insurance obligations, receivables and all non-financial
instruments, such as deferred acquisition costs, are excluded. Off-balance sheet
intangible assets, such as the value of the field force, are also excluded.
Management believes the value of excluded assets and liabilities is significant.
The fair value of the Company, therefore, cannot be estimated by aggregating the
amounts presented.
<TABLE>
<CAPTION>
1998 1997
- ------------------------------------------------------------------------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------
FINANCIAL ASSETS:
Investments:
Fixed maturities (Note 2):
Held to maturity.............. $ 473,592 $ 503,909 $ 535,651 $ 562,979
Available for sale............ 578,591 578,591 603,576 603,576
Mortgage loans on real estate
(Note 2)...................... 166,835 178,559 178,826 187,992
Other:
Derivative financial
instruments (Note 9).......... 566 2 970 62
Separate accounts assets (Note
1)............................ 1,491,679 1,491,679 1,236,759 1,236,759
FINANCIAL LIABILITIES
Future policy benefits for
fixed annuities............... 788,780 765,430 880,809 852,391
Separate account
liabilities................... 1,355,430 1,302,422 1,136,408 1,086,565
- ------------------------------------------------------------------------------
</TABLE>
At December 31, 1998 and 1997, the carrying amount and fair value of future
policy benefits for fixed annuities exclude life insurance-related contracts
carried at $81,358 and $78,853, respectively, and policy loans of $5,369 and
$4,821, respectively. The fair value of these benefits is based on the status of
the annuities at December 31, 1998 and 1997. The fair value of deferred
annuities is estimated as the carrying amount less any surrender charges and
related loans. The fair value for annuities in non-life contingent payout status
is estimated as the present value of projected benefit payments at rates
appropriate for contracts issued in 1998 and 1997.
At December 31, 1998 and 1997, the fair value of liabilities related to separate
accounts is estimated as the carrying amount less applicable surrender charges
and less variable insurance contracts carried at $136,249 and $100,351,
respectively.
F-19
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
11. STATUTORY INSURANCE ACCOUNTING PRACTICES
Reconciliations of net income for the years ended December 31 and stockholder's
equity at December 31, as shown in the accompanying financial statements, to
that determined using statutory accounting practices are as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------------
Net income, per accompanying
financial statements............... $ 36,348 $ 31,178 $ 27,684
Deferred policy acquisition
costs.............................. (2,841) (7,432) (9,087)
Adjustments of future policy
benefit liabilities................ (6,199) (4,928) (9,683)
Deferred income tax benefit........ (2,369) (960) (2,095)
Provision for losses on
investments........................ 862 296 877
IMR gain/loss transfer and
amortization....................... (1,451) (119) 1,010
Adjustment to separate account
reserves........................... 2,767 10,267 8,863
Other, net......................... (350) 430 116
- --------------------------------------------------------------------
Net income, on basis of statutory
accounting practices............... $ 26,767 $ 28,732 $ 17,685
- --------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------------
Stockholder's equity, per
accompanying financial
statements......................... $ 279,466 $ 257,279 $ 229,863
Deferred policy acquisition
costs.............................. (129,477) (126,614) (119,183)
Adjustments of future policy
benefit liabilities................ 4,697 9,452 13,458
Deferred income taxes.............. 7,912 11,445 9,046
Asset valuation reserve............ (15,516) (16,698) (19,446)
Adjustments of separate account
liabilities........................ 56,223 53,456 43,189
Adjustments of investments to
amortized cost..................... (17,266) (20,613) (11,016)
Premiums due, deferred and
advance............................ 1,381 1,237 1,149
Deferred revenue liability......... 2,482 1,941 1,342
Allowance for losses............... 1,500 1,645 1,349
Non-admitted assets................ (450) (552) (634)
Interest maintenance reserve....... (3,001) (1,551) (1,432)
Other, net......................... (2,915) (1,463) (281)
- --------------------------------------------------------------------
Stockholder's equity, on basis of
statutory accounting practices..... $ 185,036 $ 168,963 $ 147,404
- --------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
12. YEAR 2000 ISSUE (UNAUDITED)
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of the Company. All of the
systems used by the Company are maintained by AEFC and are utilized by multiple
subsidiaries and affiliates of AEFC. The Company's business is heavily dependent
upon AEFC's computer systems and has significant interactions with systems of
third parties.
A comprehensive review of AEFC's computer systems and business processes,
including those specific to the Company, has been conducted to identify the
major systems that could be affected by the Year 2000 issue. Steps are being
taken to resolve any potential problems including modification to existing
software and the purchase of new software. These measures are scheduled to be
completed and tested on a timely basis. AEFC's target date for substantially
completing corrective measures on business critical systems was December 31,
1998. Substantial testing of these systems was targeted for completion early in
1999. Testing of these systems is targeted for completion early in 1999. AEFC is
currently on track with this schedule and is also on track to finish the work on
non-critical systems by June 30, 1999.
AEFC continues to evaluate the Year 2000 readiness of advisors and other third
parties
F-20
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
12. YEAR 2000 ISSUE (UNAUDITED) (CONTINUED)
whose system failures could have an impact on the Company's operations. The
potential materiality of any such impact is not known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
F-21
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- -----------------------------------------------------------------
REPORT OF INDEPENDENT AUDITORS
The Board of Directors
IDS Life Insurance Company of New York
We have audited the accompanying balance sheets of IDS Life Insurance Company of
New York (a wholly owned subsidiary of IDS Life Insurance Company) as of
December 31, 1998 and 1997, and the related statements of income, stockholder's
equity and cash flows for each of the three years in the period ended December
31, 1998. 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 financial position of IDS Life Insurance Company of
New York at December 31, 1998 and 1997, and the results of its operations and
its cash flows for each of the three years in the period ended December 31,
1998, in conformity with generally accepted accounting principles.
Ernst & Young LLP
February 4, 1999
Minneapolis, Minnesota
F-22
<PAGE>
PART C.
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part B of this Registration Statement.
IDS Life of New York Accounts 4,10,11,5,6,9,12,13 and 14
Statements of Net Assets at Dec. 31, 1998.
Statements of Operations for the year ended Dec. 31, 1998.
Statements of Changes in Net Assets for the years ended Dec. 31, 1998
and Dec. 31, 1997.
Notes to Financial Statements.
Report of Independent Auditors dated March 12, 1999.
IDS Life Insurance Company of New York:
Balance Sheets at Dec. 31, 1998 and 1997.
Statements of Income for the years ended Dec. 31, 1998, 1997, and 1996.
Statements of Cash Flows for the years ended Dec. 31, 1998, 1997, and
1996.
Notes to Financial Statements.
Report of Independent Auditors dated February 4, 1999.
(b) Exhibits:
1.1 Resolution of the Executive Committee of the Board of Directors of IDS Life
of New York dated November 12, 1981, filed electronically as Exhibit 1.1 to
Post-Effective Amendment No. 9 to Registration Statement No. 33-4174, is
incorporated herein by reference.
1.2 Resolution of the Executive Committee of the Board of Directors of IDS Life
of New York establishing Account 9 on Feb. 12, 1986, filed electronically
as Exhibit 1.2 to Post-Effective Amendment No. 9 to Registration Statement
No. 33-4174, is incorporated herein by reference.
1.3 Resolution of the Board of Directors of IDS Life Insurance Company of New
York establishing Accounts 10 and 11 on Oct. 8, 1991, filed electronically
as Exhibit 1.3 to Post-Effective Amendment No. 10 to Registration Statement
No. 33-4174 is incorporated herein by reference.
1.4 Consent in Writing in Lieu of Meeting of Board of Directors of IDS Life
Insurance Company of New York establishing Accounts 12, 13 and 14 on April
17, 1996, filed electronically as Exhibit 1.4 to Post-Effective Amendment
No. 13 to Registration Statement No. 33-4174, is incorporated herein by
reference.
2. Not applicable.
3. Form of Variable Annuity and Life Insurance Distribution Agreement, filed
electronically as Exhibit 3 to Post-Effective Amendment No. 9 to
Registration Statement No. 33-4174, is incorporated herein by reference.
4.1 Copy of form of Qualified Deferred Annuity Contract (form 39192), filed
electronically as Exhibit 4.1 to Post-Effective Amendment No. 9 to
Registration Statement No. 33-4174, is incorporated herein by reference.
4.2 Copy of form of Non-Qualified Deferred Annuity Contract (form 39191), filed
electronically as Exhibit 4.2 to Post-Effective Amendment No. 9 to
Registration Statement No. 33-4174, is incorporated herein by reference.
4.3 Copy of form of Deferred Annuity Contract (IRA) (form 39192 IRA), filed
electronically as Exhibit 4.3 to Post-Effective Amendment No. 9 to
Registration Statement No. 33-4174, is incorporated herein by reference.
<PAGE>
5. Copy of Form of Application for IDS Flexible Annuity Contract of New York,
filed electronically as Exhibit 5.2 to Post-Effective Amendment No. 9 to
Registration Statement No. 33-4174, is incorporated herein by reference.
6.1 Revised Charter of IDS Life of New York dated April, 1992, filed
electronically as Exhibit 6.1 to Post-Effective Amendment No. 10 to
Registration Statement No. 33-4174 is incorporated herein by reference.
6.2 By-Laws of IDS Life of New York, dated May, 1992, filed electronically as
Exhibit 6.2 to Post-Effective Amendment No. 10 to Registration Statement
No. 33-4174 is incorporated herein by reference.
7. Not applicable.
8. Not applicable.
9. Opinion of counsel and consent to its use as to the legality of the
securities being registered, filed electronically herewith.
10. Consent of Independent Auditors, filed electronically herewith.
11. None.
12. Not applicable.
13. Schedule for computation of each performance quotation filed electronically
as Exhibit 13 to Post-Effective Amendment No. 13 to Registration Statement
No. 33-4174, is incorporated herein by reference.
14. Power of Attorney dated April 14, 1999, filed electronically herewith as
Exhibit 14.
Item 25. Directors and Officers of the Depositor (IDS Life Insurance Company of
New York)
Name Principal Business Address Positions and Offices with
Depositor
- --------------------- ---------------------------------------------------------
Timothy V. Bechtold IDS Tower 10 Director and President
Minneapolis, MN 55440
Maureen A. Buckley 20 Madison Ave. Extension Director, Vice President,
Albany, NY Chief Operating Officer and
Consumer Affairs Officer
Rodney P. Burwell Xerxes Corporation Director
7901 Xerxes Ave. So.
Minneapolis, MN
John R. Cattau 20 Madison Ave. Extension Director
Albany, NY
James E. Choat IDS Tower 10 Executive Vice President,
Minneapolis, MN 55440 Institutional Products
Group
Robert R. Grew 20 Madison Avenue Extension Director
Albany, NY
Lorraine R. Hart IDS Tower 10 Vice President, Investments
Minneapolis, MN 55440
Jay C. Hatlestad IDS Tower 10 Vice President and
Minneapolis, MN 55440 Controller Assured Assets
<PAGE>
Jeffrey S. Horton IDS Tower 10 Vice President and
Minneapolis, MN 55440 Treasurer
Jean B. Keffeler 3424 Zenith Ave. So. Director
Minneapolis, MN
Richard W. Kling IDS Tower 10 Director and Chairman of
Minneapolis, MN 55440 the Board
Bruce A. Kohn IDS Tower 10 Counsel and Assistant
Minneapolis, MN 55440 Secretary
Eric L. Marhoun IDS Tower 10 General Counsel and
Minneapolis, MN 55440 Secretary
Thomas R. McBurney 1700 Foshay Tower Director
821 Marquette Ave.
Minneapolis, MN 55440
Mary Ellyn Minenko IDS Tower 10 Counsel and Assistant
Minneapolis, MN 55440 Secretary
Edward J. Muhl IDS Tower 10 Director
Minneapolis, MN 55440
Thomas V. Nicolosi Suite 220 Director
500 Mamaroneck Avenue
Harrison, NY 10528
Stephen P. Norman World Financial Center Director
New York, NY
F. Dale Simmons IDS Tower 10 Vice President, Real Estate
Minneapolis, MN 55440 Loan Management
Richard M. Starr 20 Madison Avenue Extension Director
Albany, NY
William A. Stoltzmann IDS Tower 10 Counsel and Assistant
Minneapolis, MN 55440 Secretary
Philip C. Wentzel IDS Tower 10 Vice President and
Minneapolis, MN 55440 Controller, Risk Management
Michael R. Woodward 20 Madison Avenue Extension Director
Albany, NY
<PAGE>
Item 26. Persons Controlled by or Under Common Control with the Depositor or
Registrant
IDS Life Insurance Company of New York is a wholly-owned
subsidiary of IDS Life Insurance Company which is a
wholly-owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is a
wholly-owned subsidiary of American Express Company (American
Express).
The following list includes the names of major subsidiaries of
American Express.
<TABLE>
<CAPTION>
<S> <C>
Jurisdiction of
Name of Subsidiary
Incorporation
I. Travel Related Services
American Express Travel Related Services Company, Inc. New York
II. International Banking Services
American Express Bank Ltd.
Connecticut
III. Companies engaged in Financial Services
Advisory Capital Strategies Group Inc. Minnesota
American Centurion Life Assurance Company New York
American Enterprise Investment Services Inc. Minnesota
American Enterprise Life Insurance Company Indiana
American Express Asset Management Group Inc. Minnesota
American Express Asset Management International Inc. Delaware
American Express Asset Management International (Japan) Ltd. Japan
American Express Asset Management Ltd. England
American Express Client Service Corporation Minnesota
American Express Corporation Delaware
American Express Financial Advisors Inc. Delaware
American Express Financial Corporation Minnesota
Delaware
American Express Insurance Agency of Arizona Inc. Arizona
American Express Insurance Agency of Idaho Inc. Idaho
American Express Insurance Agency of Nevada Inc. Nevada
American Express Insurance Agency of Oregon Inc. Oregon
American Express Minnesota Foundation Minnesota
American Express Property Casualty Insurance Agency of Kentucky Inc. Kentucky
American Express Property Casualty Insurance Agency of Maryland Inc. Maryland
American Express Property Casualty Insurance Agency of Pennsylvania Inc.
Pennsylvania
American Express Trust Company Minnesota
American Partners Life Insurance Company Arizona
IDS Cable Corporation Minnesota
IDS Cable II Corporation Minnesota
IDS Capital Holdings Inc. Minnesota
IDS Certificate Company Delaware
IDS Futures Corporation Minnesota
IDS Insurance Agency of Alabama Inc. Alabama
IDS Insurance Agency of Arkansas Inc. Arkansas
IDS Insurance Agency of Massachusetts Inc.
Massachusetts
IDS Insurance Agency of New Mexico Inc. New Mexico
IDS Insurance Agency of North Carolina Inc. North
Carolina
IDS Insurance Agency of Utah Inc. Utah
IDS Insurance Agency of Wyoming Inc. Wyoming
IDS Life Insurance Company Minnesota
IDS Life Insurance Company of New York New York
IDS Management Corporation Minnesota
IDS Partnership Services Corporation Minnesota
IDS Plan Services of California, Inc. Minnesota
IDS Property Casualty Insurance Company Wisconsin
<PAGE>
IDS Real Estate Services, Inc. Delaware
IDS Realty Corporation Minnesota
IDS Sales Support Inc. Minnesota
IDS Securities Corporation Delaware
Investors Syndicate Development Corp. Nevada
North Dakota Public Employee Payment Company Minnesota
</TABLE>
Item 27. Number of Contractowners
On March 1, 1999, there were 16,411 contract owners of
qualified Flexible Annuity contracts. There were 12,164 owners
of non-qualified contracts.
Item 28. Indemnification
The By-Laws of the depositor provide that it shall indemnify any person made a
party to an action or proceeding by or in the right of the depositor to procure
a judgment in its favor, by reason of the fact that he, his testator or
intestate, is or was a director or officer or employee of the depositor against
the reasonable expenses, including attorneys' fees, actually and necessarily
incurred by him in connection with the defense of such action or proceeding, or
in connection with the appeal therein, except in relation to matters as to which
such person is adjudged to have breached his duty to the depositor; and The
depositor shall indemnify any person made, or threatened to be made a party to
an action or proceeding other than one by or in the right of the depositor to
procure a judgment in its favor, whether civil or criminal, including an action
by or in the right of any other corporation of any type or kind domestic or
foreign, which any director or officer or employee of the depositor served in
any capacity at the request of the depositor, by reason of the fact that he, his
testator or intestate, was a director or officer or employee of the depositor,
or served such other corporation in any capacity, against judgments, fines,
amounts paid in settlement and reasonable expenses, including attorneys' fees,
actually and necessarily incurred as a result of such action or proceeding, or
any appeal therein, if such person acted in good faith, for a purpose which he
reasonably believed to be in the best interests of the depositor and, in
criminal actions or proceedings, in addition had no reasonable cause to believe
that his conduct was unlawful.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to director, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
Item 29. Principal Underwriters.
(a) American Express Financial Advisors acts as principal underwriter for
the following investment companies:
IDS Bond Fund, Inc.; IDS California Tax-Exempt Trust; IDS Discovery
Fund, Inc.; IDS Equity Select Fund, Inc.; IDS Extra Income Fund, Inc.;
IDS Federal Income Fund, Inc.; IDS Global Series, Inc.; IDS Growth
Fund, Inc.; IDS High Yield Tax-Exempt Fund, Inc.; IDS International
Fund, Inc.; IDS Investment Series, Inc.; IDS Managed Retirement Fund,
Inc.; IDS Market Advantage Series, Inc.; IDS Money Market Series, Inc.;
IDS New Dimensions Fund, Inc.; IDS Precious Metals Fund, Inc.; IDS
Progressive Fund, Inc.; IDS Selective Fund, Inc.; IDS Special
Tax-Exempt Series Trust; IDS Stock Fund, Inc.; IDS Strategy Fund, Inc.;
IDS Tax-Exempt Bond Fund, Inc.; IDS Tax-Free Money Fund, Inc.; IDS
Utilities Income Fund, Inc., Growth Trust; Growth and Income Trust;
Income Trust, Tax-Free Income Trust, World Trust and IDS Certificate
Company.
<PAGE>
(b) As to each director, officer or partner of the principal underwriter:
<TABLE>
<CAPTION>
<S> <C> <C>
Name and Principal Business Address Position and Offices with Positions with Offices with
Underwriter Registrant
- ------------------------------------------ ------------------------------------ -----------------------------
Ronald. G. Abrahamson Vice President - Service Quality None
IDS Tower 10 and Reengineering
Minneapolis, MN 55440
Douglas A. Alger Senior Vice President - Human None
IDS Tower 10 Resources
Minneapolis, MN 55440
Peter J. Anderson Senior Vice President - Investment Vice President
IDS Tower 10 Operations
Minneapolis, MN 55440
Ward D. Armstrong Vice President-American Express None
IDS Tower 10 Retirement Services
Minneapolis, MN 55440
John M. Baker Vice President - Plan Sponsor None
IDS Tower 10 Services
Minneapolis, MN 55440
Joseph M. Barksy, III Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
Timothy V. Bechtold Vice President - Risk Management Director and President
IDS Tower 10 Products
Minneapolis, MN 55440
John D. Begley Group Vice President - Ohio/Indiana None
Suite 100
7760 Olentangy River Rd.
Columbus, OH 43235
Brent L. Bisson Group Vice President - Los Angeles None
Suite 900 Metro
E. Westside Twr
11835 West Olympic Blvd.
Los Angeles, CA 90064
John C. Boeder Vice President - Nonproprietary None
IDS Tower 10 Products
Minneapolis, MN 55440
Walter K. Booker Group Vice President - New Jersey None
IDS Tower 10
Minneapolis, MN 55440
Bruce J. Bordelon Group Vice President - Gulf States None
Galleria One Suite 1900
Galleria Blvd.
Metairie, LA 70001
Charles R. Branch Group Vice President - Northwest None
Suite 200
West 111 North River Dr.
Spokane, WA 99201
<PAGE>
Douglas W. Brewers Vice President - Sales Support None
IDS Tower 10
Minneapolis, MN 55440
Karl J. Breyer Corporate Senior Vice President None
IDS Tower 10
Minneapolis, MN 55440
Cynthia M. Carlson Vice President - American Express None
IDS Tower 10 Securities Services
Minneapolis, MN 55440
Mark W. Carter Senior Vice President and Chief None
IDS Tower 10 Marketing Officer
Minneapolis, MN 55440
James E. Choat Senior Vice President - Executive Vice President -
IDS Tower 10 Institutional Products Group Institutional Products Group
Minneapolis, MN 55440
Kenneth J. Ciak Vice President and General Manager None
IDS Property Casualty - IDS Property Casualty
1400 Lombardi Avenue
Green Bay, WI 54304
Paul A. Connolly Vice President - Advisor Staffing, None
IDS Tower 10 Training and Support
Minneapolis, MN 55440
Henry J. Cormier Group Vice President - Connecticut None
Commerce Center One
333 East River Drive
East Hartford, CT 06108
John M. Crawford Group Vice President - None
Suite 200 Arkansas/Springfield/Memphis
10800 Financial Ctr Pkwy
Little Rock, AR 72211
Kevin F. Crowe Group Vice President - None
Suite 312 Carolinas/Eastern Georgia
7300 Carmel Executive Pk
Charlotte, NC 28226
Colleen Curran Vice President and Assistant None
IDS Tower 10 General Counsel
Minneapolis, MN 55440
Luz Maria Davis Vice President - Communications None
IDS Tower 10
Minneapolis, MN 55440
Scott M. DiGiammarino Group Vice President - None
Suite 500 Washington/Baltimore
8045 Leesburg Pike
Vienna, VA 22182
<PAGE>
Bradford L. Drew Group Vice President - Eastern None
Two Datran Center Florida
Penthouse One B
9130 S. Dadeland Blvd.
Miami, FL 33156
Douglas K. Dunning Vice President - Assured Assets None
IDS Tower 10 Product Development and Management
Minneapolis, MN 55440
James P. Egge Group Vice President - Western None
4305 South Louise, Suite 202 Iowa, Nebraska, Dakotas
Sioux Falls, SD 57103
Gordon L. Eid Senior Vice President, General None
IDS Tower 10 Counsel and Chief Compliance
Minneapolis, MN 55440 Officer
Robert M. Elconin Vice President - Government None
IDS Tower 10 Relations
Minneapolis, MN 55440
Phillip W. Evans, Group Vice President - Rocky None
Suite 600 Mountain
6985 Union Park Center
Midvale, UT 84047-4177
Gordon M. Fines Vice President - Mutual Fund None
IDS Tower 10 Equity Investments
Minneapolis, MN 55440
Douglas L. Forsberg Vice President - Institutional None
IDS Tower 10 Products Group
Minneapolis, MN 55440
Jeffrey P. Fox Vice President and Corporate None
IDS Tower 10 Controller
Minneapolis, MN 55440
William P. Fritz Group Vice President - Gateway None
Suite 160
12855 Flushing Meadows Dr.
St. Louis, MO 63131
Carl W. Gans Group Vice President - Twin City None
8500 Tower Suite 1770 Metro
8500 Normandale Lake Blvd.
Bloomington, MN 55437
David A. Hammer Vice President and Marketing None
IDS Tower 10 Controller
Minneapolis, MN 55440
Teresa A. Hanratty Group Vice President - Northern None
Suites 6&7 New England
169 South River Road
Bedford, NH 03110
<PAGE>
Robert L. Harden Group Vice President - Boston Metro None
Two Constitution Plaza
Boston, MA 02129
Lorraine R. Hart Vice President - Insurance Vice President, Investments
IDS Tower 10 Investments
Minneapolis, MN 55440
Scott A. Hawkinson Vice President and Controller - None
IDS Tower 10 Private Client Group
Minneapolis, MN 55440
Brian M. Heath Group Vice President - North Texas None
Suite 150
801 E. Campbell Road
Richardson, TX 75081
Janis K. Heaney Vice President - Incentive None
IDS Tower 10 Management
Minneapolis, MN 55440
James G. Hirsh Vice President and Assistant None
IDS Tower 10 General Counsel
Minneapolis, MN 55440
Jon E. Hjelm Group Vice President - Rhode None
310 Southbridge Street Island/Central - Western
Auburn, MA 01501 Massachusetts
David J. Hockenberry Group Vice President - Tennessee None
30 Burton Hills Blvd. Valley
Suite 175
Nashville, TN 37215
Jeffrey S. Horton Vice President and Treasurer None
IDS Tower 10
Minneapolis, MN 55440
David R. Hubers Chairman, President and Chief Board member
IDS Tower 10 Executive Officer
Minneapolis, MN 55440
Martin G. Hurwitz Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
James M. Jensen Vice President - Insurance Product None
IDS Tower 10 Development and Management
Minneapolis, MN 55440
Marietta L. Johns Senior Vice President - Field None
IDS Tower 10 Management
Minneapolis, MN 55440
Nancy E. Jones Vice President - Business None
IDS Tower 10 Development
Minneapolis, MN 55440
<PAGE>
Ora J. Kaine Vice President - Financial None
IDS Tower 10 Advisory Services
Minneapolis, MN 55440
Linda B. Keene Vice President - Market Development None
IDS Tower 10
Minneapolis, MN 55440
G. Michael Kennedy Vice President - Investment None
IDS Tower 10 Services and Investment Research
Minneapolis, MN 55440
Susan D. Kinder Senior Vice President - None
IDS Tower 10 Distribution Services
Minneapolis, MN 55440
Richard W. Kling Senior Vice President - Products Director and Chairman of
IDS Tower 10 the Board
Minneapolis, MN 55440
John M. Knight Vice President - Investment Treasurer
IDS Tower 10 Accounting
Minneapolis, MN 55440
Paul F. Kolkman Vice President - Actuarial Finance None
IDS Tower 10
Minneapolis, MN 55440
Claire Kolmodin Vice President - Service Quality None
IDS Tower 10
Minneapolis, MN 55440
David S. Kreager Group Vice President - Greater None
Suite 108 Michigan
Trestle Bridge V
5126 Lovers Lane
Kalamazoo, MI 49002
Steven C. Kumagai Director and Senior Vice President None
IDS Tower 10 - Field Management and Business
Minneapolis, MN 55440 Systems
Mitre Kutanovski Group Vice President - Chicago None
Suite 680 Metro
8585 Broadway
Merrillville, IN 48410
Kurt A. Larson Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
Lori J. Larson Vice President - Brokerage and None
IDS Tower 10 Direct Services
Minneapolis, MN 55440
Daniel E. Laufenberg Vice President and Chief U.S. None
IDS Tower 10 Economist
Minneapolis, MN 55440
<PAGE>
Peter A. Lefferts Senior Vice President - Corporate None
IDS Tower 10 Strategy and Development
Minneapolis, MN 55440
Douglas A. Lennick Director and Executive Vice None
IDS Tower 10 President - Private Client Group
Minneapolis, MN 55440
Mary J. Malevich Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
Fred A. Mandell Vice President - Field Marketing None
IDS Tower 10 Readiness
Minneapolis, MN 55440
Daniel E. Martin Group Vice President - Pittsburgh None
Suite 650 Metro
5700 Corporate Drive
Pittsburgh, PA 15237
Sarah A. Mealey Vice President - Mutual Funds None
IDS Tower 10
Minneapolis, MN 55440
Paula R. Meyer Vice President - Assured Assets None
IDS Tower 10
Minneapolis, MN 55440
William P. Miller Vice President and Senior None
IDS Tower 10 Portfolio Manager
Minneapolis, MN 55440
James A. Mitchell Executive Vice President - None
IDS Tower 10 Marketing and Products
Minneapolis, MN 55440
Pamela J. Moret Vice President - Variable Assets None
IDS Tower 10
Minneapolis, MN 55440
Alan D. Morgenstern Group Vice President - Central None
Suite 200 California/Western Nevada
3500 Market Street
Camp Hill, NJ 17011
Barry J. Murphy Senior Vice President - Client None
IDS Tower 10 Service
Minneapolis, MN 55440
Mary Owens Neal Vice President - Mature Market None
IDS Tower 10 Segment
Minneapolis, MN 55440
<PAGE>
Thomas V. Nicolosi Group Vice President - New York Director
Suite 220 Metro Area
500 Mamaroneck Avenue
Harrison, NY 10528
Michael J. O'Keefe Vice President - Advisory Business None
IDS Tower 10 Systems
Minneapolis, MN 55440
James R. Palmer Vice President - Taxes None
IDS Tower 10
Minneapolis, MN 55440
Marc A. Parker Group Vice President - None
10200 SW Greenburg Road Portland/Eugene
Suite 110
Portland, OR 97223
Carla P. Pavone Vice President - Compensation and None
IDS Tower 10 Field Administration
Minneapolis, MN 55440
Thomas P. Perrine Senior Vice President - Group None
IDS Tower 10 Relationship Leader/American
Minneapolis, MN 55440 Express Technologies Financial
Services
Susan B. Plimpton Vice President - Marketing Services None
IDS Tower 10
Minneapolis, MN 55440
Larry M. Post Group Vice President - None
One Tower Bridge Philadelphia Metro
100 Front Street, 8th Fl
West Conshohocken, PA 19428
Ronald W. Powell Vice President and Assistant None
IDS Tower 10 General Counsel
Minneapolis, MN 55440
Diana R. Prost Group Vice President - None
3030 N.W. Expressway Kansas/Oklahoma
Suite 900
Oklahoma City, OK 73112
James M. Punch Vice President and Project Manager None
IDS Tower 10 - Platform I Value Enhanced
Minneapolis, MN 55440
Frederick C. Quirsfeld Senior Vice President - Fixed None
IDS Tower 10 Income
Minneapolis, MN 55440
Rollyn C. Renstrom Vice President - Corporate None
IDS Tower 10 Planning and Analysis
Minneapolis, MN 55440
<PAGE>
R. Daniel Richardson Group Vice President - Southern None
Suite 800 Texas
Arboretum Plaza One
9442 Capital of Texas Hwy. N
Austin, TX 78759
ReBecca K. Roloff Senior Vice President - Field None
IDS Tower 10 Management and Financial Advisory
Minneapolis, MN 55440 Service
Stephen W. Roszell Senior Vice President - None
IDS Tower 10 Institutional
Minneapolis, MN 55440
Max G. Roth Group Vice President - None
Suite 201 S. IDS Ctr Wisconsin/Upper Michigan
1400 Lombardi Avenue
Green Bay, WI 54304
Erven A. Samsel Senior Vice President - Field None
45 Braintree Hill Park Management
Suite 402
Braintree, MA 02184
Russell L. Scalfano Group Vice President - None
Suite 201 Illinois/Indiana/Kentucky
101 Plaza East Blvd.
Evansville, IN 47715
William G. Scholz Group Vice President - Arizona/Las None
Suite 205 Vegas
7333 E. Doubletree Ranch Rd
Scottsdale, AZ 85258
Stuart A. Sedlacek Senior Vice President and Chief None
IDS Tower 10 Financial Officer
Minneapolis, MN 55440
Donald K. Shanks Vice President - Property Casualty None
IDS Tower 10
Minneapolis, MN 55440
F. Dale Simmons Vice President - Senior Portfolio Vice President, Real Estate
IDS Tower 10 Manager, Insurance Investments Loan Management
Minneapolis, MN 55440
Judy P. Skoglund Vice President - Quality and None
IDS Tower 10 Service Support
Minneapolis, MN 55440
James B. Solberg Group Vice President - Eastern None
466 Westdale Mall Iowa Area
Cedar Rapids, IA 52404
Bridget Sperl Vice President - Geographic None
IDS Tower 10 Service Teams
Minneapolis, MN 55440
<PAGE>
Paul J. Stanislaw Group Vice President - Southern None
Suite 1100 California
Two Park Plaza
Irvine, CA 92714
Lisa A. Steffes Vice President - Cardmember None
IDS Tower 10 Initiatives
Minneapolis, MN 55440
Lois A. Stilwell Group Vice President - Outstate None
Suite 433 Minnesota Area/North
9900 East Bren Road Dakota/Western Wisconsin
Minnetonka, MN 55343
William A. Stoltzmann Vice President and Assistant None
IDS Tower 10 General Counsel
Minneapolis, MN 55440
James J. Strauss Vice President and General Auditor None
IDS Tower 10
Minneapolis, MN 55440
Jeffrey J. Stremcha Vice President - Information None
IDS Tower 10 Resource Management/ISD
Minneapolis, MN 55440
Barbara Stroup Stewart Vice President - Channel None
IDS Tower 10 Development
Minneapolis, MN 55440
Craig P. Taucher Group Vice President - None
Suite 150 Orlando/Jacksonville
4190 Belfort Road
Jacksonville, FL 32216
Neil G. Taylor Group Vice President - None
Suite 425 Seattle/Tacoma/Hawaii
101 Elliott Avenue West
Seattle, WA 98119
John R. Thomas Senior Vice President None
IDS Tower 10
Minneapolis, MN 55440
Peter S. Velardi Group Vice President - None
Suite 180 Atlanta/Birmingham
1200 Ashwood Parkway
Atlanta, GA 30338
Charles F. Wachendorfer Group Vice President - Detroit None
Suite 100 Metro
Stanford Plaza II
7979 East Tufts Ave. Pkwy
Denver, CO 80237
Wesley W. Wadman Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
<PAGE>
Donald F. Weaver Group Vice President - Greater None
3500 Market Street, Suite 200 Pennsylvania
Camp Hill, PA 17011
Norman Weaver Jr. Senior Vice President - Field None
1010 Main St., Suite 2B Management
Huntington Beach, CA 92648
Michael L. Weiner Vice President - Tax Research and None
IDS Tower 10 Audit
Minneapolis, MN 55440
Lawrence J. Welte Vice President - Investment None
IDS Tower 10 Administration
Minneapolis, MN 55440
Jeffry M. Welter Vice President - Equity and Fixed None
IDS Tower 10 Income Trading
Minneapolis, MN 55440
Thomas L. White Group Vice President - Cleveland None
Suite 200 Metro
28601 Chagrin Blvd.
Woodmere, OH 44122
Eric S. Williams Group Vice President - Virginia None
Suite 250
3951 Westerre Parkway
Richmond, VA 23233
William J. Williams Group Vice President - Western None
Two North Tamiami Trail Florida
Suite 702
Sarasota, FL 34236
<PAGE>
Edwin M. Wistrand Vice President and Assistant None
IDS Tower 10 General Counsel
Minneapolis, MN 55440
Michael D. Wolf Vice President - Senior Portfolio None
IDS Tower 10 Manager
Minneapolis, MN 55440
Michael R. Woodward Senior Vice President - Field Director
32 Ellicott St. Management
Suite 100
Batavia, NY 14020
</TABLE>
Item 29 (c).
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Net Underwriting
Name of Principal Discounts and Compensation on Brokerage
Underwriter Commissions Redemption Commissions Compensation
American Express $1,115,312 $886,431 None None
Financial Advisors
Inc.
</TABLE>
<PAGE>
Item 30. Location of Accounts and Records
IDS Life Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) (b) & (c) These undertakings were filed with the Registrant's initial
Registration Statements, File Nos. 33-4174 and 811-3500.
(d) The sponsoring insurance company represents that the fees and
charges deducted under the contract, in the aggregate, are
reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by the
insurance company.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, IDS Life Insurance Company of New York, on behalf of the Registrant,
certifies that it meets the requirements of Securities Act Rule 485(b) for
effectiveness of this Registration Statement and has caused this Registration
Statement to be signed on its behalf, in the City of Minneapolis, and State of
Minnesota, on this 28th day of April, 1999.
IDS LIFE ACCOUNT 4
IDS LIFE ACCOUNT 5
IDS LIFE ACCOUNT 6
IDS LIFE ACCOUNT 9
IDS LIFE ACCOUNT 10
IDS LIFE ACCOUNT 11
IDS LIFE ACCOUNT 12
IDS LIFE ACCOUNT 13
IDS LIFE ACCOUNT 14
(Registrant)
By IDS Life Insurance Company of New York
(Sponsor)
By /s/ Richard W. Kling*
Richard W. Kling
Chairman of the Board
As required by the Securities Act of 1933, this Registration Statement has been
signed by the following persons in the capacities indicated on this 28th day of
April, 1999.
Signature Title
/s/ Timothy V. Bechtold* Director and President
Timothy V. Bechtold
/s/ Maureen A. Buckley* Director, Vice President, Chief Operating
Maureen A. Buckley Officer and Consumer Affairs Officer
/s/ Rodney P. Burwell* Director
Rodney P. Burwell
/s/ John R. Cattau* Director
John R. Cattau
/s/ Robert R. Grew* Director
Robert R. Grew
/s/ Jeffrey S. Horton* Vice President and Treasurer
Jeffrey S. Horton
<PAGE>
Signature Title
/s/ Jean B. Keffeler* Director
Jean B. Keffeler
/s/ Richard W. Kling* Director and Chairman of the Board
Richard W. Kling
/s/ Thomas R. McBurney* Director
Thomas R. McBurney
/s/ Edward J. Muhl* Director
Edward J. Muhl
/s/ Thomas V. Nicolosi* Director
Thomas V. Nicolosi
/s/ Stephen P. Norman* Director
Steven P. Norman
/s/ Richard M. Starr* Director
Richard M. Starr
/s/ Philip C. Wentzel* Vice President and Controller
Philip C. Wentzel
/s/ Michael R. Woodward* Director
Michael R. Woodward
*Signed pursuant to Power of Attorney dated April 14, 1999, filed herewith as
Exhibit 14,
by /s/ Mary Ellyn Minenko
Mary Ellyn Minenko
<PAGE>
CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 16
This Registration Statement is comprised of the following papers and documents:
The Cover Page.
Part A.
The prospectus.
Part B.
Statement of Additional Information.
Financial Statements.
Part C.
Other Information.
The signatures.
Exhibits.
IDS Life of New York Accounts 4,5,6,9,10,11,12,13, and 14
File No. 33-4174 / 811-3500
EXHIBIT INDEX
Exhibit 9: Opinion of Counsel
Exhibit 10: Consent of Independent Auditors
Exhibit 14: Power of Attorney, dated April 14, 1999
April 28, 1999
IDS Life Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
RE: Registration Statement on Form N-4
File No.: 33-4174
Ladies and Gentlemen:
I am familiar with the establishment of the IDS Life of New York Accounts 4, 5,
6, 9, 10, 11, 12, 13 and 14, ("Accounts"), which are separate accounts of IDS
Life Insurance Company of New York ("Company") established by the Company's
Board of Directors according to applicable insurance law. I also am familiar
with the above-referenced registration Statement filed by the Company on behalf
of the Accounts with the Securities and Exchange Commission.
I have made such examination of law and examined such documents and records as
in my judgment are necessary and appropriate to enable me to give the following
opinion:
1. The Company is duly incorporated, validly existing and in good standing
under applicable state law and is duly licensed or qualified to do business
in each jurisdiction where it transacts business. The Company has all
corporate powers required to carry on its business and to issue the
contracts.
2. The Accounts are validly created and existing separate accounts of the
Company and are duly authorized to issue the securities registered.
3. The contracts issued by the Company, when offered and sold in accordance
with the prospectus contained in the Registration Statement and in
compliance with applicable law, will be legally issued and represent
binding obligations of the Company in accordance with their terms.
I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement.
Sincerely,
/s/ Mary Ellyn Minenko
Mary Ellyn Minenko
Group Counsel
(612) 671-3678
MEM/NL/lal
Consent of Independent Auditors
We consent to the use of our report dated February 4, 1999 on the financial
statements IDS Life Insurance Company of New York and our report dated March 12,
1999 on the financial statements of IDS Life of New York Accounts 11, 4, 12, 14,
13, 10, 9, 6 and 5 in Post-Effective Amendment No. 16 to the Registration
Statement (Form N-4, No. 33-4174) and related Prospectus for the registration of
the Flexible Annuity Contracts to be offered by IDS Life Insurance Company of
New York.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
April 27, 1999
IDS LIFE INSURANCE COMPANY OF NEW YORK
POWER OF ATTORNEY
City of Albany
State of New York
Each of the undersigned, as officers and/or directors of IDS Life Insurance
Company of New York on behalf of the below listed registrants previously have
filed registration statements and amendments thereto pursuant to the
requirements of the Securities Act of 1933 and the Investment Company Act of
1940 with the Securities and Exchange Commission:
<TABLE>
<CAPTION>
<S> <C> <C>
1933 Act 1940 Act
Reg. Number Reg. Number
IDS Life of New York 4, 5, 6, 9, 10, 11, 12, 13 and 14 33-52567 811-3500
IDS Life of New York Employee Benefit Annuity (EBA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Flexible Annuity (Flex-NY) 33-4174 811-3500
- -------------------------------------------------------------------------
IDS Life of New York Variable Retirement and Combination 2-78194 811-3500
Retirement Annuity (CRA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Flexible Portfolio Annuity Account 333-03867 811-07623
IDS Life of New York Flexible Portfolio Annuity (FPA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account 8 33-15290 811-5213
Flexible Premium Variable Life Insurance Policy (VUL-NY)
- -------------------------------------------------------------------------
Flexible Premium Variable Life Insurance Policy (VUL-3-NY)
- -------------------------------------------------------------------------
Flexible Premium Survivorship Variable Life Insurance Policy 333-42257 811-5213
(V2D-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account SBS 33-45776 811-6560
Symphony Annuity (SYMPHONY-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account 7 33-10334 811-4913
Single Premium Variable Life Insurance Policy (SBS-SPVL-NY)
</TABLE>
hereby constitutes and appoints William A. Stoltzmann, Mary Ellyn Minenko,
Eileen J. Newhouse, Eric L. Marhoun, Christopher R. Long and Timothy S. Meehan
or any one of them, as her or his attorney-in-fact and agent, to sign for her or
him in her or his name, place and stead any and all filings, applications
(including applications for exemptive relief), periodic reports, registration
statements for existing or future products (with all exhibits and other
documents required or desirable in connection therewith) other documents, and
amendments thereto and to file such filings, applications, periodic reports,
registration statements other documents, and amendments thereto with the
Securities and Exchange Commission, and any necessary states, and grants to any
or all of them the full power and authority to do and perform each and every act
required or necessary in connection therewith.
<PAGE>
Dated the 14 day of April, 1999.
/s/ Timothy V. Bechtold /s/ Thomas R. McBurney
Timothy V. Bechtold Thomas R. McBurney
Director and President Director
/s/ Maureen A. Buckley /s/ Edward J. Muhl
Maureen A. Buckley Edward J. Muhl
Director, Vice President, Chief Operating Director
Officer and Consumer Affairs
Officer
/s/ Rodney P. Burwell /s/ Thomas V. Nicolosi
Rodney P. Burwell Thomas V. Nicolosi
Director Director
/s/ John R. Cattau /s/ Stephen P. Norman
John R. Cattau Stephen P. Norman
Director Director
/s/ Robert R. Grew /s/ Richard M. Starr
Robert R. Grew Richard M. Starr
Director Director
/s/ Jeffrey S. Horton /s/ Philip C. Wentzel
Jeffrey S. Horton Philip C. Wentzel
Vice President and Treasurer Vice President and
Controller
/s/ Jean B. Keffeler /s/ Michael R. Woodward
Jean B. Keffeler Michael R. Woodward
Director Director
/s/ Richard W. Kling
Richard W. Kling
Director and Chairman of the Board
