PRUDENTIAL SERIES FUND INC, 485APOS, 1997-02-28

PRUDENTIAL SERIES FUND INC
485APOS, 1997-02-28

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AS FILED WITH THE SEC ON_____________________. REGISTRATION NO. 2-80896

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

----------
FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
PRE-EFFECTIVE AMENDMENT NO. [ ]
POST-EFFECTIVE AMENDMENT NO. 32 [X]
AND

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
AMENDMENT NO. 35 [X]
(Check appropriate box or boxes)

THE PRUDENTIAL SERIES FUND, INC.
(Exact Name of Registrant)

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(Name of Depositor)

PRUDENTIAL PLAZA
NEWARK, NEW JERSEY 07102-3777
(800) 445-4571
(Address and telephone number of principal executive offices)

----------

THOMAS EARLY
SECRETARY
THE PRUDENTIAL SERIES FUND, INC.
PRUDENTIAL PLAZA
NEWARK, NEW JERSEY 07102-3777
(Name and address of agent for service)

Copy to:
JEFFREY C. MARTIN
SHEA & GARDNER
1800 MASSACHUSETTS AVENUE, N.W.
WASHINGTON, D.C. 20036

The Registrant has registered an indefinite amount of securities pursuant to
Rule 24f-2 under the Investment Company Act of 1940. The Rule 24f-2 notice for
fiscal year 1996 will be filed on or about February 27, 1997.

It is proposed that this filing will become effective (check appropriate space):

[ ] immediately upon filing pursuant to paragraph (b) of Rule 485

[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485

[ ] 75 days after filing pursuant to paragraph (a)(2) of Rule 485

[ ] on ___________ pursuant to paragraph (b) of Rule 485

[X] on May 1, 1997 pursuant to paragraph (a)(1) of Rule 485

[ ] on ___________ pursuant to paragraph (a)(2) of Rule 485

CROSS REFERENCE SHEET
(as required by 495(a) under the 1933 Act)
<CAPTION>

N1-A ITEM NUMBER AND CAPTION LOCATION
- ---------------------------- --------

PART A
<S> <C>
1. Cover Page .......................................... Cover Page

2. Synopsis ............................................ Not Applicable

3. Condensed Financial Information ..................... Financial Highlights; Portfolio Rates of Return;
Investment Objectives and Policies of the Portfolios

4. General Description of Registrant ................... The Series Fund; Investment Objectives and Policies
of the Portfolios; Investment Restrictions Applicable
to the Portfolios

5. Management of the Fund .............................. Investment Manager; Investment Management
Arrangements and Expenses; Portfolio Brokerage and
Related Practices; Portfolio Transactions and
Brokerage; Custodian, Transfer Agent and Dividend
Disbursing Agent; Monitoring for Possible Conflict

6. Capital Stock and Other Securities .................. Investment Objectives and Policies of the Portfolios;
Dividends, Distributions and Taxes; Voting Rights;
Additional Information

7. Purchase of Securities Being Offered ................ Purchase and Redemption of Shares; Determination
of Net Asset Value

8. Redemption or Repurchase ............................ Purchase and Redemption of Shares; Other
Information Concerning the Series Fund

9. Pending Legal Proceedings ........................... Not Applicable

PART B

10. Cover Page .......................................... Cover Page

11. Table of Contents ................................... Contents

12. General Information and History ..................... Not Applicable

13. Investment Objectives and Policies .................. Investment Objectives and Policies of the Portfolios;
Investment Restrictions

14. Management of the Fund .............................. Management of the Series Fund

15. Control Persons and Principal Holders
of Securities ....................................... Not Applicable

16. Investment Advisory and Other
Services ............................................ Investment Management Arrangements and
Expenses; Custodian, Transfer Agent, and Dividend
Disbursing Agent; Experts

17. Brokerage Allocation ................................ Portfolio Transactions and Brokerage

18. Capital Stock and Other Securities .................. Not Applicable
</TABLE>

<PAGE>

N1-A ITEM NUMBER AND CAPTION LOCATION
- ---------------------------- --------
<S> <C>
19. Purchase, Redemption and Pricing of
Securities Being Offered ............................ Determination of Net Asset Value

20. Tax Status .......................................... Not Applicable

21. Underwriters ........................................ Determination of Net Asset Value

22. Calculations of Performance Data .................... Not Applicable

23. Financial Statements ................................ Financial Statements of The Prudential Series Fund,
Inc.
</TABLE>
PART C

Information required to be included in Part C is set forth under the
appropriate Item, so numbered in Part C to this Registration Statement.

<PAGE>

PART A

INFORMATION REQUIRED IN A PROSPECTUS

<PAGE>

PROSPECTUS

MAY 1, 1997

THE PRUDENTIAL_______________
SERIES FUND, INC.

The Prudential Series Fund, Inc. (the "Series Fund") is a diversified, open-end
management investment company (commonly known as a "mutual fund") that is
intended to provide a range of investment alternatives through its fifteen
separate portfolios, each of which is, for investment purposes, in effect a
separate fund. The portfolios are: the Money Market Portfolio, the Diversified
Bond Portfolio, the Government Income Portfolio, two Zero Coupon Bond Portfolios
with different liquidation dates--2000 and 2005, the Conservative Balanced
Portfolio, the Flexible Managed Portfolio, the High Yield Bond Portfolio, the
Stock Index Portfolio, the Equity Income Portfolio, the Equity Portfolio, the
Prudential Jennison Portfolio, the Small Capitalization Stock Portfolio, the
Global Portfolio, and the Natural Resources Portfolio. A separate class of
capital stock is issued for each portfolio. Shares of the Series Fund are
currently sold only to separate accounts (the "Accounts") of The Prudential
Insurance Company of America ("Prudential") and certain other insurers to fund
the benefits under variable life insurance and variable annuity contracts (the
"Contracts") issued by those Companies. The Accounts invest in shares of the
Series Fund through subaccounts that correspond to the portfolios. The Accounts
will redeem shares of the Series Fund to the extent necessary to provide
benefits under the Contracts or for such other purposes as may be consistent
with the Contracts.

NOT EVERY PORTFOLIO IS AVAILABLE UNDER ALL OF THE VARIABLE CONTRACTS. THE
PROSPECTUS FOR EACH CONTRACT LISTS THE PORTFOLIOS CURRENTLY AVAILABLE UNDER THAT
PARTICULAR CONTRACT.

SHARES OF THE MONEY MARKET PORTFOLIO AND THE GOVERNMENT INCOME PORTFOLIO ARE
NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT. WHILE THE MONEY MARKET
PORTFOLIO SEEKS TO MAINTAIN A STABLE PRICE PER SHARE, THERE IS NO ASSURANCE THAT
THE PORTFOLIO WILL BE ABLE TO DO SO.

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

THE INVESTMENT OBJECTIVES OF THE PORTFOLIOS CAN BE FOUND ON THE NEXT PAGE

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

Information contained in this prospectus should be read carefully by a
prospective investor before an investment is made. Additional information about
the Series Fund has been filed with the Securities and Exchange Commission in a
statement of additional information, dated May 1, 1997 which information is
incorporated herein by reference and is available without charge upon written
request to The Prudential Series Fund, Inc., Prudential Plaza, Newark, New
Jersey 07102-3777, or by telephoning (800) 445-4571.

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

PLEASE READ THIS PROSPECTUS AND KEEP IT FOR FUTURE REFERENCE.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THE PRUDENTIAL SERIES FUND, INC.
Prudential Plaza
Newark, New Jersey 07102-3777
Telephone: (800) 445-4571

PSF-1 Ed 5-97

<PAGE>

INVESTMENT OBJECTIVES OF THE PORTFOLIOS ARE AS FOLLOWS:

FIXED INCOME PORTFOLIOS

MONEY MARKET PORTFOLIO. The maximum current income that is consistent with
stability of capital and maintenance of liquidity through investment in
high-quality short-term debt obligations.

DIVERSIFIED BOND PORTFOLIO. A high level of income over the longer term while
providing reasonable safety of capital through investment primarily in readily
marketable intermediate and long-term fixed income securities that provide
attractive yields but do not involve substantial risk of loss of capital through
default.

GOVERNMENT INCOME PORTFOLIO. Achievement of a high level of income over the
longer term consistent with the preservation of capital through investment
primarily in U.S. Government securities, including intermediate and long-term
U.S. Treasury securities and debt obligations issued by agencies of or
instrumentalities established, sponsored or guaranteed by the U.S. Government.
At least 65% of the total assets of the portfolio will be invested in U.S.
Government securities.

ZERO COUPON BOND PORTFOLIOS 2000 AND 2005. Achievement of the highest
predictable compounded investment return for a specific period of time,
consistent with the safety of invested capital, by investing primarily in debt
obligations of the United States Treasury and investment-grade corporations that
have been issued without interest coupons or stripped of their unmatured
interest coupons, interest coupons that have been stripped from such debt
obligations, and receipts and certificates for such stripped debt obligations
and stripped coupons.

To obtain the predicted investment return an investor must plan to retain his or
her investment in the selected portfolio until the designated year in which the
portfolio will be liquidated. Redemption prior to that time may result in a
loss. Moreover, since the portfolios will be actively managed with the objective
of obtaining a yield higher than the predicted yield, there is a risk that the
actual yield may be lower.

BALANCED PORTFOLIOS

CONSERVATIVE BALANCED PORTFOLIO. Achievement of a favorable total investment
return consistent with a portfolio having a conservatively managed mix of money
market instruments, fixed income securities, and common stocks, in proportions
believed by the investment manager to be appropriate for an investor desiring
diversification of investment who prefers a relatively lower risk of loss than
that associated with the Flexible Managed Portfolio while recognizing that this
reduces the chances of greater appreciation.

FLEXIBLE MANAGED PORTFOLIO. Achievement of a high total return consistent with a
portfolio having an aggressively managed mix of money market instruments, fixed
income securities, and common stocks, in proportions believed by the investment
manager to be appropriate for an investor desiring diversification of investment
who is willing to accept a relatively high level of loss in an effort to achieve
greater appreciation.

HIGH YIELD BOND PORTFOLIOS

HIGH YIELD BOND PORTFOLIO. Achievement of a high total return through investment
in high yield/high risk fixed income securities in the medium to lower quality
ranges. SUCH SECURITIES MAY HAVE SPECULATIVE CHARACTERISTICS AND GENERALLY
INVOLVE GREATER RISKS OF LOSS OF INCOME AND PRINCIPAL THAN HIGHER RATED
SECURITIES.

DIVERSIFIED STOCK PORTFOLIOS

STOCK INDEX PORTFOLIO. Achievement of investment results that correspond to the
price and yield performance of publicly traded common stocks in the aggregate by
following a policy of attempting to duplicate the price and yield performance of
the Standard & Poor's 500 Composite Stock Price Index.

EQUITY INCOME PORTFOLIO. Both current income and capital appreciation through
investment primarily in common stocks and convertible securities that provide
favorable prospects for investment income returns above those of the Standard &
Poor's 500 Stock Index or the NYSE Composite Index.

EQUITY PORTFOLIO. Capital appreciation through investment primarily in common
stocks of companies, including major established corporations as well as smaller
capitalization companies, that appear to offer attractive prospects of price
appreciation that is superior to broadly-based stock indices. Current income, if
any, is incidental.

PRUDENTIAL JENNISON PORTFOLIO. Long-term growth of capital through investment
primarily in equity securities of established companies with above-average
growth prospects. Current income, if any, is incidental.

SMALL CAPITALIZATION STOCK PORTFOLIO. Long-term growth of capital through
investment primarily in equity securities of publicly-traded companies with
small market capitalization. Current income, if any, is incidental.

GLOBAL PORTFOLIO. Long-term growth of capital through investment primarily in
common stock and common stock equivalents of foreign and domestic issuers.
Current income, if any, is incidental.

<PAGE>

SPECIALIZED PORTFOLIOS

NATURAL RESOURCES PORTFOLIO. Long-term growth of capital through investment
primarily in common stocks and convertible securities of "natural resource
companies" (as defined in this prospectus) and in securities (typically debt
securities and preferred stock) the terms of which are related to the market
value of a natural resource.

There can be no assurance that the objectives of any portfolio will be realized.
See INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS, page 10. The Series
Fund may in the future establish other portfolios with different investment
objectives.

<PAGE>

CONTENTS

Page

FINANCIAL HIGHLIGHTS...........................................................1

PORTFOLIO RATES OF RETURN......................................................9

THE SERIES FUND...............................................................10

THE ACCOUNTS AND THE CONTRACTS................................................10

INVESTMENT MANAGER............................................................10

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS.........................10
FIXED INCOME PORTFOLIOS..............................................11
Money Market Portfolio...............................................11
Diversified Bond Portfolio...........................................11
Government Income Portfolio..........................................12
Zero Coupon Bond Portfolios 2000 and 2005............................14
BALANCED PORTFOLIOS..................................................15
Conservative Balanced Portfolio......................................15
Flexible Managed Portfolio...........................................16
HIGH YIELD BOND PORTFOLIOS...........................................17
High Yield Bond Portfolio............................................17
DIVERSIFIED STOCK PORTFOLIOS.........................................19
Stock Index Portfolio................................................19
Equity Income Portfolio..............................................21
Equity Portfolio.....................................................21
Prudential Jennison Portfolio........................................22
Small Capitalization Stock Portfolio.................................23
Global Portfolio.....................................................24
SPECIALIZED PORTFOLIOS...............................................25
Natural Resources Portfolio..........................................25
CONVERTIBLE SECURITIES...............................................26
LOAN PARTICIPATIONS..................................................27
FOREIGN SECURITIES...................................................27
OPTIONS ON EQUITY SECURITIES.........................................28
OPTIONS ON DEBT SECURITIES...........................................29
OPTIONS ON STOCK INDICES.............................................30
OPTIONS ON FOREIGN CURRENCIES........................................30
FUTURES CONTRACTS....................................................31
OPTIONS ON FUTURES CONTRACTS.........................................31
REPURCHASE AGREEMENTS................................................32
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS.......................32
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES..........................32
SHORT SALES..........................................................33
SHORT SALES AGAINST THE BOX..........................................33
INTEREST RATE SWAPS..................................................33
LOANS OF PORTFOLIO SECURITIES........................................33

INVESTMENT RESTRICTIONS APPLICABLE TO THE PORTFOLIOS..........................34

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................34

PURCHASE AND REDEMPTION OF SHARES.............................................35

DETERMINATION OF NET ASSET VALUE..............................................35

DIVIDENDS, DISTRIBUTIONS, AND TAXES...........................................36

OTHER INFORMATION CONCERNING THE SERIES FUND..................................38
INCORPORATION AND AUTHORIZED STOCK...................................38
VOTING RIGHTS........................................................38
MONITORING FOR POSSIBLE CONFLICT.....................................38
PERIODIC REPORTS.....................................................38
PORTFOLIO BROKERAGE AND RELATED PRACTICES............................38
CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT.............39
ADDITIONAL INFORMATION...............................................39

APPENDIX: SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST........................................................A1

<PAGE>

THE PRUDENTIAL SERIES FUND, INC.

FINANCIAL HIGHLIGHTS

(For a share outstanding throughout the periods indicated)

To be filed by Post-Effective Amendment pursuant to Rule 485(b).

Series Fund - pages 1 through 8

<PAGE>

PORTFOLIO RATES OF RETURN

The following table, based upon the immediately preceding condensed financial
information for the Series Fund, shows first the average annual compounded net
rates of return for each portfolio for the year ended December 31, 1996, for the
5 year period ending on that date, and from the inception date of each portfolio
to December 31, 1996. Then, the annual net rates of return for each portfolio
for each year are shown. These rates of return should not be regarded as an
estimate or prediction of future performance. They may be useful in assessing
the competence and performance of the Series Fund's investment advisor and in
helping you to decide which portfolios to choose. THIS INFORMATION RELATES ONLY
TO THE SERIES FUND AND DOES NOT REFLECT THE VARIOUS OTHER CHARGES MADE UNDER THE
CONTRACTS.

5 YEAR 10 YEAR
YEAR PERIOD PERIOD INCEPTION YEAR YEAR YEAR
INCEPTION ENDED ENDED ENDED DATE TO ENDED ENDED ENDED
DATE 12/31/96 12/31/96 12/31/96 12/31/96 12/31/95 12/31/94 12/31/93
--------- -------- -------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET
DIVERSIFIED BOND
GOVERNMENT INCOME
ZERO COUPON BOND 2000
ZERO COUPON BOND 2005
CONSERVATIVE BALANCED
FLEXIBLE MANAGED
HIGH YIELD BOND
STOCK INDEX
EQUITY INCOME
EQUITY
PRUDENTIAL JENNISON
SMALL CAPITALIZATION STOCK
GLOBAL
NATURAL RESOURCES

YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
12/31/92 12/31/91 12/31/90 12/31/89 12/31/88 12/31/87
-------- -------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
MONEY MARKET
DIVERSIFIED BOND
GOVERNMENT INCOME
ZERO COUPON BOND 2000
ZERO COUPON BOND 2005
CONSERVATIVE BALANCED
FLEXIBLE MANAGED
HIGH YIELD BOND
STOCK INDEX
EQUITY INCOME
EQUITY
PRUDENTIAL JENNISON
SMALL CAPITALIZATION STOCK
GLOBAL
NATURAL RESOURCES

</TABLE>

Portfolio Rates of Return figures to be filed pursuant to Rule 485(b)

9 - Series Fund
<PAGE>

THE SERIES FUND

The Prudential Series Fund, Inc. (the "Series Fund"), a diversified open-end
management investment company, is a Maryland corporation organized on November
15, 1982. The Series Fund is currently made up of fifteen separate portfolios:
the Money Market Portfolio, the Diversified Bond Portfolio, the Government
Income Portfolio, the Zero Coupon Bond Portfolios 2000 and 2005, the
Conservative Balanced Portfolio, the Flexible Managed Portfolio, the High Yield
Bond Portfolio, the Stock Index Portfolio, the Equity Income Portfolio, the
Equity Portfolio, the Prudential Jennison Portfolio, the Small Capitalization
Stock Portfolio, the Global Portfolio, and the Natural Resources Portfolio. Each
portfolio is, for investment purposes, in effect a separate investment fund, and
a separate class of capital stock is issued for each portfolio. In other
respects the Series Fund is treated as one entity. Each share of capital stock
issued with respect to a portfolio has a pro-rata interest in the assets of that
portfolio and has no interest in the assets of any other portfolio. Each
portfolio bears its own liabilities and also its proportionate share of the
general liabilities of the Series Fund. The Series Fund is registered under the
Investment Company Act of 1940 (the "1940 Act") as an open-end, diversified,
management investment company. This registration does not imply any supervision
by the Securities and Exchange Commission over the Series Fund's management or
its investment policies or practices.

THE ACCOUNTS AND THE CONTRACTS

Shares in the Series Fund are currently sold only to separate accounts of The
Prudential Insurance Company of America ("Prudential") and certain other
insurers to fund benefits under variable life insurance and variable annuity
contracts issued by those Companies. All the separate accounts are referred to
as the "Accounts", and all the contracts are referred to as the "Contracts".
Each Contract owner allocates the net premiums and the assets relating to the
Contract, within the limitations described in the Contracts, among the
subaccounts of the Accounts which in turn invest in the corresponding portfolios
of the Series Fund. Not all portfolios of the Series Fund are currently
available to all Contracts. The attached prospectus for the Contracts lists the
portfolios that are currently available and describes the particular type of
Contract selected and the relationship between changes in the value of shares of
each portfolio and changes in the benefits payable under the Contracts. The
rights of the Accounts as shareholders should be distinguished from the rights
of a Contract owner which are described in the Contracts. The terms
"shareholder" or "shareholders" in this prospectus refer to the Accounts.

INVESTMENT MANAGER

Prudential is the investment advisor of the Series Fund. Prudential's principal
business address is Prudential Plaza, Newark, New Jersey 07102-3777.

Prudential has entered into a Service Agreement with its wholly-owned subsidiary
The Prudential Investment Corporation ("PIC"), which provides that PIC will
furnish to Prudential such services as Prudential may require in connection with
the performance of its obligations under an Investment Advisory Agreement with
the Series Fund. In addition, Prudential has entered into a Subadvisory
Agreement with its wholly-owned subsidiary Jennison Associates Capital Corp.
("Jennison"), under which Jennison furnishes investment advisory services in
connection with the management of the Prudential Jennison Portfolio. See
INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES, page 34.

Prudential will continue to have responsibility for all investment advisory
services under its Investment Advisory Agreement with respect to the Series
Fund.

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

Each portfolio of the Series Fund has a different investment objective which it
pursues through separate investment policies as described below. Since each
portfolio has a different investment objective, each can be expected to have
different investment results and incur different market and financial risks. The
Series Fund may in the future establish other portfolios with different
investment objectives.

The investment objectives of each portfolio are fundamental and may not be
changed without the approval of the holders of a majority of the outstanding
shares of the portfolio affected (which for this purpose and under the 1940 Act
means the lesser of: (i) 67% of the shares represented at a meeting at which
more than 50% of the outstanding shares are represented; or (ii) more than 50%
of the outstanding shares). The policies by which a portfolio seeks to achieve
its investment objectives, however, are not fundamental. They may be changed by
the Board of Directors of the Series Fund without the approval of the
shareholders.

10 - Series Fund
<PAGE>

The portfolio turnover rate of the portfolios that were available for investment
as of December 31, 1996 can be found in the FINANCIAL HIGHLIGHTS table on pages
1 through 8. The portfolio turnover rate is, generally, the percentage computed
by dividing the lesser of portfolio purchases or sales by the average value of
the portfolio, in each case excluding securities with maturities of 1 year or
less. Generally, the higher the portfolio turnover rate, the greater the
brokerage costs incurred by a portfolio.

The following paragraphs describe the investment objectives and policies of each
portfolio. There is no guarantee that any of these objectives will be met.

FIXED INCOME PORTFOLIOS

MONEY MARKET PORTFOLIO. The objective of this portfolio is to achieve, through
investment in high-quality short-term debt obligations, the maximum current
income that is consistent with stability of capital and maintenance of
liquidity.

The portfolio seeks to achieve this objective by following the policy of
investing primarily in money market instruments denominated in U.S. dollars that
mature in 397 days or less from the date the portfolio acquires them. Money
market instruments include short-term obligations of the United States and
foreign governments, their agencies, instrumentalities, and political
subdivisions, and of domestic and foreign banks and corporations. They also
include commercial paper, other corporate obligations, obligations of savings
and loan associations and savings banks, and variable amount demand master
notes. The portfolio may also enter into repurchase and reverse repurchase
agreements and may purchase and sell securities on a when-issued and delayed
delivery basis. These investment techniques may involve additional risks. A
detailed description of the money market instruments in which the portfolio may
invest, of the repurchase and reverse repurchase agreements it may enter into,
and of the risks associated with those instruments and agreements may be found
in the Appendix to this prospectus.

Because of the high quality, short-term nature of the portfolio's holdings,
increases in the value of an investment in the portfolio will be derived almost
entirely from interest on the securities held by it. Accordingly, the results
for the portfolio are subject to the risk of fluctuation in short-term interest
rates.

DIVERSIFIED BOND PORTFOLIO. The objective of this portfolio is to achieve a high
level of income over the longer term while providing reasonable safety of
capital through investment primarily in readily marketable intermediate and
long-term fixed income securities that provide attractive yields but do not
involve substantial risk of loss of capital through default.

The portfolio seeks to achieve this objective by following the policies of
purchasing primarily debt securities of investment grade or, if not rated, of
comparable quality in the opinion of the portfolio manager and of investing from
time to time a portion of its assets in high quality money market instruments of
the kind held in the Money Market Portfolio as described in the Appendix to this
prospectus. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, the
Diversified Bond Portfolio may invest, without limit, in high quality money
market instruments of the kind held by the Money Market Portfolio.

Since the value of fixed income securities generally fluctuates inversely with
changes in interest rates, the proportions of intermediate or longer-term
securities and short-term debt obligations held in the portfolio will vary to
reflect Prudential's assessment of prospective changes in interest rates, so
that the portfolio may benefit from relative price appreciation when interest
rates decline and suffer lesser declines in value when interest rates rise. The
success of this strategy will depend on Prudential's ability to forecast changes
in interest rates, and there is a corresponding risk that the value of the
securities held in the portfolio will decline.

At least 80% of the portfolio's holdings (including short-term debt obligations)
will generally consist of debt securities that at the time of purchase have a
rating within the four highest grades determined by Moody's Investor Services,
Inc. ("Moody's"), Standard & Poor's Rating Group ("S&P"), or a similar
nationally-recognized rating service. The portfolio may retain a security whose
rating has dropped below the four highest grades as determined by a commercial
rating service. Without limitation, the portfolio may invest in obligations of
the U.S. Government and its agencies and instrumentalities. The Appendix to the
statement of additional information defines the ratings that are given to debt
securities by Moody's and S&P and describes the standards applied by them in
assigning these ratings.

The remaining assets of the portfolio may be invested in, among other things,
debt securities that are not rated within the four highest grades or convertible
debt securities, preferred stocks or convertible preferred stocks of any
quality. On occasion, however, the portfolio may acquire common stock, not
through direct investment but by the conversion of convertible debt securities
or the exercise of warrants. For additional information regarding warrants, see
INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS in the statement of
additional information. No more than 10% of the value of the total assets of the
portfolio will be held in common stocks, and those will usually be sold as soon
as a favorable opportunity is available.

11 - Series Fund
<PAGE>

The portfolio may invest up to 20% of its total assets in United States currency
denominated debt securities issued outside the United States by foreign or
domestic issuers. For additional information regarding such securities, see
FOREIGN SECURITIES on page 27.

In addition, the portfolio may: (i) purchase and sell options on debt
securities; (ii) purchase and sell interest rate futures contracts and options
thereon; (iii) purchase securities on a when-issued or delayed delivery basis;
(iv) use interest rate swaps; and (v) make short sales. These techniques are
described on pages 29 through 33, and further information about some of them is
included in the statement of additional information.

Barbara Kenworthy, Managing Director, Prudential Investments, a division of PIC,
has been portfolio manager of the Diversified Bond Portfolio since 1995. Ms.
Kenworthy is also portfolio manager of the Prudential Diversified Bond Fund,
Inc., the Prudential Government Income Fund, Inc., and the Government Income and
Zero Coupon Bond Portfolios 2000 and 2005 of the Series Fund. Prior to 1994, Ms.
Kenworthy was a portfolio manager and president of several taxable fixed-income
funds for The Dreyfus Corp.

GOVERNMENT INCOME PORTFOLIO. The objective of this portfolio is to achieve a
high level of income over the longer term consistent with the preservation of
capital through investment primarily in intermediate and long-term U.S. Treasury
securities and debt obligations issued by agencies of or instrumentalities
established, sponsored or guaranteed by the U.S. Government. At least 65% of the
total assets of the portfolio will be invested in U.S. Government securities.

The portfolio seeks to achieve this objective by investing at least 65% of its
assets in U.S. Treasury securities, obligations issued or guaranteed by U.S.
Government agencies and instrumentalities, mortgage-related securities issued by
U.S. Government instrumentalities or non-governmental corporations, or related
collateralized mortgage obligations. These instruments are described below. The
portfolio may invest up to a total of 35% of its assets in the following three
categories: (1) money market instruments of the kind held in the Money Market
Portfolio; (2) securities of issuers other than the U.S. Government and related
entities, usually foreign governments, where the principal and interest are
substantially guaranteed (generally to the extent of 90% thereof) by U.S.
Government agencies whose guarantee is backed by the full faith and credit of
the United States and where an assurance of payment on the unguaranteed portion
is provided for in a comparable way; (3) Foreign Government Securities including
debt securities issued or guaranteed, as to payment of principal and interest,
by governments, governmental agencies, supranational entities and other
governmental entities denominated in U.S. dollars. A supranational entity is an
entity constituted by the national governments of several countries to promote
economic development. Examples of such supranational entities include, among
others, the World Bank (International Bank for Reconstruction and Development),
the European Investment Bank and the Asian Development Bank; and (4)
asset-backed securities rated in either of the top two ratings by Moody's or
Standard & Poor's, or if not rated, determined by the portfolio manager to be of
comparable quality. A description of corporate bond ratings is contained in the
Appendix to the statement of additional information. When conditions dictate a
temporary defensive strategy or during temporary periods of portfolio
structuring and restructuring, the Government Income Portfolio may invest,
without limit, in high quality money market instruments of the kind held by the
Money Market Portfolio.

U.S. Treasury Securities. U.S. Treasury securities include bills, notes, and
bonds issued by the U.S. Treasury. These instruments are direct obligations of
the U.S. Government and, as such, are backed by the full faith and credit of the
United States. They differ primarily in their coupons, the lengths of their
maturities, and the dates of their issuances.

Obligations Issued or Guaranteed by U.S. Government Agencies and
Instrumentalities. Obligations issued by agencies of the U.S. Government or
instrumentalities established or sponsored by the U.S. Government include
securities that are guaranteed by federal agencies or instrumentalities, and may
or may not be backed by the full faith and credit of the United States.
Obligations of the Government National Mortgage Association ("GNMA"), the
Farmers Home Administration, and the Export-Import Bank are backed by the full
faith and credit of the United States. Securities in which the portfolio may
invest that are not backed by the full faith and credit of the United States
include obligations issued by the Tennessee Valley Authority, The Federal
National Mortgage Association ("FNMA"), the Federal Home Loan Mortgage
Corporation ("FHLMC"), the United States Postal Service, each of which has the
right to borrow from the United States Treasury to meet its obligations, and
obligations of the Federal Farm Credit Bank and the Federal Home Loan Bank, the
obligations of which may be satisfied only by the individual credit of the
issuing agency. In the case of securities not backed by the full faith and
credit of the U.S. Government, the portfolio must look principally to the agency
issuing or guaranteeing the obligation for ultimate repayment and may not be
able to assert a claim against the U.S. Government if the agency or
instrumentality does not meet its commitments.

12 - Series Fund
<PAGE>

Government Securities generally rise. Conversely, during periods of rising
interest rates, the values of such securities generally decline. The magnitude
of these fluctuations will generally be greater for securities with longer
maturities. Although changes in the value of U.S. Government Securities will not
affect investment income from those securities, they will affect the portfolio's
net asset value. The proportions of intermediate and long-term securities held
in the portfolio will vary to reflect Prudential's assessment of prospective
changes in interest rates, so that the portfolio may benefit from relative price
appreciation when interest rates decline and suffer lesser declines in value
when interest rates rise. The success of this strategy will depend on
Prudential's ability to forecast changes in interest rates, and there is a
corresponding risk that the value of the securities held in the portfolio will
decline.

Mortgage-Related Securities Issued by U.S. Government Instrumentalities or by
Non-Governmental Corporations. The portfolio may invest in the following three
types of mortgage-backed securities: (i) those issued or guaranteed by the U.S.
Government or one of its agencies or instrumentalities, such as Government
National Mortgage Association (GNMA), Federal National Mortgage Association
(FNMA) and Federal Home Loan Mortgage Corporation (FHLMC): (ii) those issued by
private issuers that represent an interest in or are collateralized by
mortgage-backed securities issued or guaranteed by the U.S. Government or one of
its agencies or instrumentalities; and (iii) those issued by private issuers
that represent an interest in or are collateralized by whole mortgage loans or
mortgage-backed securities without government guarantee but usually having some
form of private credit enhancement. The portfolio may invest in adjustable rate
and fixed rate mortgage securities. With respect to private mortgage-backed
securities not collateralized by securities of the U.S. Government or its
agencies, the portfolio will only purchase such securities rated not lower than
Aa by Moody's or AA by Standard & Poor's or similarly rated by another
nationally recognized rating service or, if unrated, of comparable quality in
the opinion of the portfolio manager. The mortgages backing these securities
include conventional 30 year fixed rate mortgages, 15 year fixed rate mortgages,
graduated payment mortgages, and adjustable rate mortgages (ARMs). The
mortgage-backed securities may include those representing an undivided ownership
interest in a pool of mortgages, e.g. GNMA, FNMA and FHLMC certificates. The
U.S. Government or the issuing agency guarantees the payment of interest and
principal of mortgage-backed securities issued by the U.S. Government or its
agencies/instrumentalities. However, these guarantees do not extend to the
securities' yield or value, which are likely to vary inversely with fluctuations
in interest rates, nor do the guarantees extend to the yield or value of the
portfolio's shares. Mortgage-backed securities are in most cases pass-through
instruments, through which the holders receive a share of all interest and
principal payments from the mortgages underlying the securities, net of certain
fees. Because the prepayment characteristics of the underlying mortgages vary,
it is not possible to predict accurately the average life of a particular issue
of pass-through securities. Mortgage-backed securities are often subject to more
rapid repayment then their stated maturity date would indicate as a result of
the pass-through of prepayments of principal on the underlying mortgage
obligations. For example, securities backed by mortgages with 30 year maturities
are customarily treated as prepaying fully in the 12th year and securities
backed by mortgages with 15 year maturities are customarily treated as prepaying
fully in the seventh year. While the timing of prepayments of graduated payment
mortgages differs somewhat from that of conventional mortgages, the prepayment
experience of graduated payment mortgages is basically the same as that of the
conventional mortgages of the same maturity dates over the life of the pool.
During periods of declining interest rates, prepayment of mortgages underlying
mortgage-backed securities can be expected to accelerate. When the mortgage
obligations are prepaid, the portfolio reinvests the prepaid amounts in
securities, the yields of which reflect interest rates prevailing at the time.
Therefore, the portfolio's ability to maintain a portfolio of high yielding
mortgage-backed securities will be adversely affected to the extent that
prepayments of mortgages must be reinvested in securities which have lower
yields than the prepaid mortgages. Moreover, prepayments of mortgages which
underlie securities purchased at a premium could result in capital losses.
Mortgage-backed securities of the types described under (i) and (ii) above are
considered to be U.S. Government Securities for purposes of meeting the
requirement that at least 65% of the portfolio's assets be invested in U.S.
Government Securities.

Adjustable rate mortgage securities are pass-through mortgage securities
collateralized by mortgages with adjustable rather than fixed rates. Generally
ARMs have a specified maturity date and amortize principal over their life. In
periods of declining interest rates, there is a reasonable likelihood that ARMs
will experience increased rates of pre-payment of principal. However, the major
difference between ARMs and fixed rate mortgage securities is that the interest
rate and the rate of amortization of principal of ARMs can and do change in
accordance with movements in a particular pre-specified, published interest rate
index.

13 - Series Fund
<PAGE>

foregoing. With respect to privately issued CMOs, the portfolio will only
purchase such securities rated not lower than Aa by Moody's or AA by Standard &
Poor's or similarly rated by another nationally recognized rating service, or if
unrated, of comparable quality in the opinion of the portfolio manager.
Privately issued CMOs that are collateralized by mortgage-backed securities
issued by GNMA, FHLMC or FNMA, and CMOs issued by agencies or instrumentalities
of the U.S. Government are considered to be U.S. Government Securities for
purposes of meeting the requirement that at least 65% of the portfolio's assets
be invested in U.S. Government Securities. Neither the United States Government
nor any U.S. Government agency guarantees the payment of principal or interest
on these securities.

Asset-Backed Securities. Asset-backed securities represent a participation in,
or are secured by and payable from, a stream of payments generated by particular
assets, such as automobile or credit card receivables. Asset-backed securities
present certain risks, including the risk that the underlying obligor on the
asset, such as the automobile purchaser or the credit card holder, may default
on his or her obligation. In addition, asset-backed securities often do not
provide a security interest in the related collateral. For example, credit card
receivables are generally unsecured, and for automobile receivables the security
interests in the underlying automobiles are often not transferred when the pool
is created, with the resulting possibility that the collateral could be resold.

Under normal circumstances, this portfolio's turnover rate is not expected to
exceed 200%. Purchases of U.S. Government Securities are generally made from
dealers at prices which usually include a profit to the dealer. See PORTFOLIO
BROKERAGE AND RELATED PRACTICES, page 38.

Barbara Kenworthy, Managing Director, Prudential Investments, has been portfolio
manager of the Government Income Portfolio since 1995. Ms. Kenworthy is also
portfolio manager of the Prudential Diversified Bond Fund, Inc., the Prudential
Government Income Fund, Inc., and the Diversified Bond and Zero Coupon Bond
Portfolios 2000 and 2005 of the Series Fund. Prior to 1994, Ms. Kenworthy was a
portfolio manager and president of several taxable fixed-income funds for The
Dreyfus Corp.

ZERO COUPON BOND PORTFOLIOS 2000 AND 2005. The objective of both of these
portfolios is to achieve the highest predictable compounded investment return
for a specific period of time, consistent with the safety of invested capital,
by investing primarily in debt obligations of the United States Treasury and
investment-grade corporations that have been issued without interest coupons or
stripped of their unmatured interest coupons, interest coupons that have been
stripped from such debt obligations, and receipts and certificates for such
stripped debt obligations and stripped coupons (collectively "stripped
securities"). The two portfolios differ only in their liquidation dates, which
for each portfolio is November 15 of the specified year.

In pursuing this objective, each Zero Coupon Bond Portfolio invests only in
readily marketable debt securities that do not involve substantial risk of loss
of capital through default, although their value may vary because of changes in
the general level of interest rates. It is the policy of each Zero Coupon Bond
Portfolio to invest at least 70% of its assets in stripped securities that are
obligations of the United States Government maturing within 2 years of the
portfolio liquidation date. Up to 30% of the assets may be invested and held
either in stripped securities issued by investment-grade corporations or in
high-grade interest bearing corporate debt securities, in each case with a
quality rating of Baa or better, provided that no more than 20% of the assets of
the portfolio may be invested in interest bearing securities. However, as a
defensive position, as the liquidation date of each portfolio draws near, more
than 20% of assets may be invested in interest bearing securities when deemed
appropriate in the view of the portfolio manager given prevailing market
conditions and investment opportunities available at the time. Prudential will
evaluate the creditworthiness of potential investments in corporate securities
in order to determine whether such securities are suitable for purchase by the
portfolios. A small portion of the portfolios may be invested in money market
instruments of the kind held in the Money Market Portfolio in order to make
effective use of cash reserves pending investments in the securities described
above. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, each Zero
Coupon Bond Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio.

At the beginning of each week, Prudential will calculate the anticipated
compounded growth rate that investors purchasing shares of each portfolio that
day are predicted to achieve if their investment is maintained until the
portfolio liquidation date. That rate will change from day to day depending on
various factors, including particularly the general level of interest rates, but
daily changes will generally not be significant. If there is a significant
change in interest rates (greater than a 0.30% change in the yield of a zero
coupon Treasury bond maturing in the specified year), Prudential will
recalculate the predicted yield. Prudential will furnish the anticipated
compounded growth rate on request.

14 - Series Fund
<PAGE>

In order to achieve a predictable compounded investment return to each
portfolio's liquidation date that will be as little affected as possible by
variations in the general level of interest rates, the composition of the
securities held in each portfolio is such that the weighted average period of
time until receipt of scheduled cash payments (whether of principal or
interest)--sometimes referred to as the portfolio's "duration"--will be kept
within 1 year of the period remaining until the portfolio liquidation date. When
the portfolio's duration is thus maintained, differences between the market
value and the face amount of unmatured bonds on the portfolio's liquidation date
resulting from changes in the general level of interest rates will be
approximately equal in magnitude to, but opposite in direction from, the
difference between the amount of interest accumulated through the reinvestment
of earlier coupon or principal payments and the amount that would have been
accumulated at the originally predicted rate. Each portfolio is thus able to
hold interest bearing securities and stripped securities with maturity dates
before, during, and after the portfolio's liquidation date. The concept of
"duration" is explained more fully in the statement of additional information.

On the liquidation date of a Zero Coupon Bond Portfolio, all of the securities
held by the portfolio will be sold and all outstanding shares of the portfolio
will be redeemed. The redemption proceeds will, except as otherwise directed by
Contract owners, be used to purchase shares of the Money Market Portfolio.

Each portfolio seeks to realize a higher yield than would be obtained simply by
maintaining the portfolio's initial investments. The portfolios are actively
managed by Prudential to take advantage of trading opportunities that may exist
from time to time due to price and yield distortions resulting from changes in
the supply and demand characteristics or perceived differences in quality or
liquidity characteristics of the securities available for purchase by the
portfolio. There is a corresponding risk that, to the extent that this strategy
is unsuccessful, the initial yield objective will not be met.

The stripping of interest coupons will cause the stripped securities to be
purchased at a substantial (or "deep") discount from their principal amounts
payable at maturity. If held to maturity, these obligations provide a
predictable yield. But because interest on stripped securities is not paid in
cash on a current basis but rather is in effect compounded until maturity (or
the payment date in the case of a coupon), the market values of securities of
this type are subject to greater fluctuations, as a result of changes in
interest rates, than are the values of debt securities that provide for the
periodic payment of interest; and the longer the term to maturity of a
portfolio, the greater the risk of such fluctuations. In light of these factors,
investors who desire to attain the anticipated growth rate on their investment
expected at the time of purchase must plan to hold the portfolio's shares and to
reinvest all dividends and distributions until the portfolio matures. Any
investor who redeems his or her interest in the portfolio prior to the portfolio
liquidation date or who fails to reinvest dividends is likely to achieve quite a
different investment return than the return that was predicted on the date the
investment was made, and may even suffer a loss.

Barbara Kenworthy, Managing Director, Prudential Investments, has been portfolio
manager of the Zero Coupon Bond Portfolios 2000 and 2005 since 1995. Ms.
Kenworthy is also portfolio manager of the Prudential Diversified Bond Fund,
Inc., the Prudential Government Income Fund, Inc., and the Diversified Bond and
Government Income Portfolios of the Series Fund. Prior to 1994, Ms. Kenworthy
was a portfolio manager and president of several taxable fixed-income funds for
The Dreyfus Corp.

BALANCED PORTFOLIOS

CONSERVATIVE BALANCED PORTFOLIO. The objective of this portfolio is to achieve a
favorable total investment return consistent with a portfolio having a
conservatively managed mix of money market instruments, fixed income securities,
and common stocks in proportions believed by the investment manager to be
appropriate for an investor desiring diversification of investment who prefers a
relatively lower risk of loss than that associated with the Flexible Managed
Portfolio while recognizing that this reduces the chances of greater
appreciation.

To achieve this objective, the Conservative Balanced Portfolio will follow a
policy of maintaining a more conservative asset mix among stocks, bonds and
money market instruments than the Flexible Managed Portfolio. In general, the
portfolio manager will observe the following range of target asset allocation
mixes:

ASSET TYPE MINIMUM NORMAL MAXIMUM
---------- ------- ------ -------
Stocks 15% 35% 50%
Bonds and Money Market 25% 65% 70%

The portfolio manager will make variations in the proportions of each investment
category in accordance with its judgment about the expected returns and risks of
the various investment categories, but will maintain at least 25% of the value
of the portfolio's assets in fixed-income senior securities.

15 - Series Fund
<PAGE>

also known as high risk securities, are described below in connection with the
High Yield Bond Portfolio. A description of corporate bond ratings is contained
in the Appendix to the statement of additional information. Because of their
shorter maturities, the value of the notes and bonds in this portfolio will be
less sensitive to changes in interest rates than the longer-term bonds likely to
be held in the Flexible Managed Portfolio. Thus, there will be less of a risk of
loss of principal, but not as much of a likelihood for greater appreciation in
value. Up to 20% of the bond portion of this portfolio may be invested in United
States currency denominated debt securities issued outside the United States by
foreign or domestic issuers. The stock portion of this portfolio will be
invested primarily in the equity securities of major, established corporations
in sound financial condition that appear to offer attractive prospects of a
total return from dividends and capital appreciation that is superior to broadly
based stock indices. The portfolio may also invest in preferred stock, including
below investment grade preferred stock. The money market portion of the
portfolio will hold high quality money market instruments of the kind held by
the Money Market Portfolio. Moreover, when conditions dictate a temporary
defensive strategy or during temporary periods of portfolio structuring and
restructuring, the Conservative Balanced Portfolio may invest, without limit, in
high quality money market instruments of the kind held by the Money Market
Portfolio.

To the extent permitted by applicable insurance law, this portfolio may invest
up to 30% of its total assets in non-United States currency denominated debt and
equity securities of foreign and U.S. issuers. The particular risks of
investments in foreign securities are described under FOREIGN SECURITIES on page
27.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when-issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
on pages 28 through 33, and further information about some of them is included
in the statement of additional information.

The Conservative Balanced Portfolio is managed by a team of portfolio managers.
Mark Stumpp, Managing Director, PIC, has been lead portfolio manager of the
Conservative Balanced Portfolio since 1994 and is responsible for the overall
asset allocation decisions. Mr. Stumpp has supervisory responsibility of the
portfolio management team. Mr. Stumpp also supervises the team of portfolio
managers for the Flexible Managed Portfolio. Mr. Stumpp is also portfolio
manager for several employee benefit trusts including The Prudential Retirement
System for U.S. Employees and Special Agents. Prior to 1994, he was responsible
for corporate pension asset management for Prudential Diversified Investment
Strategies' corporate clients.

FLEXIBLE MANAGED PORTFOLIO. The objective of this portfolio is achievement of a
high total return consistent with a portfolio having an aggressively managed mix
of money market instruments, fixed income securities, and common stocks, in
proportions believed by the investment manager to be appropriate for an investor
desiring diversification of investment who is willing to accept a relatively
high level of loss in an effort to achieve greater appreciation.

To achieve this objective, the Flexible Managed Portfolio will follow a policy
of maintaining a more aggressive asset mix among stocks, bonds and money market
investments than the Conservative Balanced Portfolio. In general, the portfolio
manager will observe the following range of target asset allocation mixes:

ASSET TYPE MINIMUM NORMAL MAXIMUM
---------- ------- ------ -------
Stocks 25% 60% 100%
Bonds 0% 40% 75%
Money Market 0% 0% 75%

The portfolio manager may make short-run, and sometimes substantial, variations
in the asset mix based upon its judgment about the expected returns and risks of
the various investment categories. In varying the asset mix in accordance with
these judgments, Prudential will also seek to take advantage of imbalances in
fundamental values among the different markets.

16 - Series Fund
<PAGE>

companies with a capitalization below $5 billion that show above average
profitability (measured by return-on-equity, earnings, and dividend growth
rates) with modest price/earnings ratios. The individual equity selections for
this portfolio may tend to have more volatile market values than the equity
securities selected for the Equity Portfolio or the Conservative Balanced
Portfolio. The portfolio may also invest in preferred stock, including below
investment grade preferred stock. The money market portion of the portfolio will
hold high quality money market instruments of the kind held by the Money Market
Portfolio. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, the
Flexible Managed Portfolio may invest, without limit, in high quality money
market instruments of the kind held by the Money Market Portfolio.

The facts that this portfolio will invest in common stocks regarded as having
higher risks than those that will be purchased by the Conservative Balanced
Portfolio; that it will invest in bonds with longer maturities; and that the
"normal" mix for this portfolio will include a higher percentage of stocks all
combine to mean that the risk of investing in this portfolio is relatively
higher--to the extent that each of these factors results in greater risks--than
the risk of investing in the Conservative Balanced Portfolio.

The Flexible Managed Portfolio is managed by a team of portfolio managers. Mark
Stumpp, Managing Director, PIC, has been lead portfolio manager of the Flexible
Managed Portfolio since 1994 and is responsible for the overall asset allocation
decisions. Mr. Stumpp has supervisory responsibility of the portfolio management
team. Mr. Stumpp also supervises the team of portfolio managers for the
Conservative Balanced Portfolio. Mr. Stumpp is also portfolio manager for
several employee benefit trusts including The Prudential Retirement System for
U.S. Employees and Special Agents. Prior to 1994, he was responsible for
corporate pension asset management for Prudential Diversified Investment
Strategies' corporate clients.

HIGH YIELD BOND PORTFOLIOS

HIGH YIELD BOND PORTFOLIO. The objective of this portfolio is to achieve a high
total return through investment in a diversified portfolio of high yield/high
risk fixed income securities.

The portfolio seeks to achieve its objective by following a policy of generally
investing in fixed income securities rated in the medium to lower categories by
recognized rating services or in unrated fixed income securities of comparable
quality. The portfolio expects to invest principally in fixed income securities
rated Baa or lower by Moody's, or BBB or lower by S&P. These securities are
sometimes known as "junk bonds." Corporate bonds which are rated Baa by Moody's
are described by Moody's as being investment grade, but are also characterized
as having speculative characteristics. Corporate bonds rated below Baa by
Moody's and BBB by S&P are considered speculative. A description of corporate
bond ratings is contained in the Appendix to the statement of additional
information.

Medium to lower rated and comparable non-rated securities tend to offer higher
yields than higher rated securities with the same maturities because the
historical financial condition of the issuers of such securities may not have
been as strong as that of other issuers. Since medium to lower rated securities
generally involve greater risks of loss of income and principal than higher
rated securities, investors should consider carefully the relative risks
associated with investments in high yield/high risk securities which carry
medium to lower ratings and in comparable non-rated securities. Investors should
understand that such securities are not generally meant for short-term
investing.

The achievement of the portfolio's investment objectives will depend on
Prudential's analytical and portfolio management skills. These skills are more
important in connection with the investment in medium to lower rated and
comparable unrated securities and to the portfolio's performance than would be
the case if the portfolio invested in higher quality fixed income securities. In
selecting securities for the portfolio, Prudential will evaluate, among other
things, an issuer's financial history, condition, prospects and management. A
credit rating assigned by a commercial rating service will not measure the
market risk of high yield/high risk bonds and may not be a timely reflection of
the condition and economic viability of an individual issuer. In its credit
analysis, Prudential therefore will not rely principally on the ratings assigned
by the ratings services (e.g., Moody's and S&P), although such ratings will be
considered. Through careful selection and by investment in a diversified mix of
securities,

17 - Series Fund

<PAGE>

Prudential will seek to reduce the risks that are associated with investing in
medium to lower rated and comparable unrated debt securities.

Fixed income securities are subject to the risk of an issuer's inability to meet
principal and interest payments on the obligations (credit risk) and may also be
subject to price volatility due to such factors as interest rate sensitivity,
market perception of the creditworthiness of the issuer and general market
liquidity (market risk). The value of the fixed income securities in the
portfolio will be directly impacted by the market perception of the
creditworthiness of the securities' issuers and will fluctuate inversely with
changes in interest rates. Lower rated or unrated securities are more likely to
react to developments affecting market and credit risk than are more highly
rated securities, which react primarily to movements in the general level of
interest rates. For example, because investors generally perceive that there are
greater risks associated with investing in medium or lower rated securities, the
yields and prices of such securities may tend to fluctuate more than those of
higher rated securities. Moreover, in the lower quality segments of the fixed
income securities market, changes in perception of the creditworthiness of
individual issuers tend to occur more frequently and in a more pronounced manner
than do changes in higher quality segments of the fixed income securities
market. The yield and price of medium to lower rated securities therefore may
experience greater volatility than is the case with higher rated securities.
Prudential considers both credit risk and market risk in selecting securities
for the portfolio. By holding a diversified selection of such securities, the
portfolio seeks to reduce this volatility.

The secondary market for high yield/high risk securities, which is concentrated
in relatively few market makers, may not be as liquid as the secondary market
for more highly rated securities. Under adverse market or economic conditions,
the secondary market for high yield/high risk securities could contract further,
independent of any specific adverse changes in the condition of a particular
issuer. As a result, Prudential could find it more difficult to sell such
securities or may be able to sell the securities only at prices lower than if
such securities were widely traded. Prices realized upon the sale of such lower
rated or unrated securities therefore may be less than the prices used in
calculating the portfolio's net asset value. In the absence of readily available
market quotations, high yield/high risk securities will be valued by the Series
Fund's Board of Directors using a method that, in the good faith belief of the
Board, accurately reflects fair value. Valuing such securities in an illiquid
market is a difficult task. The Board's judgment plays a more significant role
in valuing such securities than those securities for which more objective market
data are available.

From time to time, federal laws have been enacted which have required the
divestiture by companies of their investments in high yield bonds and have
limited the deductibility of interest by certain corporate issuers of high yield
bonds. These types of laws could adversely affect the portfolio's net asset
value and investment practices, the secondary market for high yield securities,
the financial condition of issuers of these securities and the value of
outstanding high yield securities. There is currently no legislation pending
that would adversely impact the market for high yield/high risk securities.
However, there can be no assurance that such legislation will not be proposed or
enacted in the future.

During the fiscal year ended December 31, 1996, the monthly dollar weighted
average ratings of the debt obligations held by the High Yield Bond Portfolio,
expressed as a percentage of the portfolio's total investments, were as follows:

- -------------------------------------------------------------------------
Percentage of Total
Ratings Investments
- -------------------------------------------------------------------------

AAA/Aaa 0%
AA/Aa 0%
A/A 0%
BBB/Baa 0.3%
BB/Ba 18.5%
B/B 60.0%
CCC/Caa or lower 8.3%
Unrated 12.9%

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

Consistent with its investment objective, the portfolio anticipates that under
normal conditions at least 80% of the value of its total assets will be invested
in high yield/high risk, medium to lower rated fixed income securities. Fixed
income securities appropriate for the portfolio may include both convertible and
nonconvertible debt securities and preferred stock. The portfolio will not
acquire common stocks, except when attached to or included in a unit with fixed
income securities which otherwise would be attractive to the portfolio.

The portfolio may invest up to 20% of its total assets in United States currency
denominated fixed-income securities issued outside the United States by foreign
and domestic issuers. For additional information regarding such securities, see
FOREIGN SECURITIES on page 27.

18 - Series Fund
<PAGE>

The portfolio may, when it has temporary cash available, invest in money market
instruments of the kind held by the Money Market Portfolio. The portfolio may
also invest in commercial paper of domestic corporations that does not meet the
quality restrictions applicable to the investments of the Money Market
Portfolio. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, the High
Yield Bond Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio. The portfolio may
also (i) purchase and sell options on debt securities; (ii) purchase and sell
interest rate futures contracts and options thereon; (iii) purchase securities
on a when-issued or delayed delivery basis; (iv) use interest rate swaps; and
(v) make short sales. These techniques are described on pages 29 through 33, and
further information about some of them is included in the statement of
additional information.

Although the portfolio is not expected to engage in substantial short-term
trading, it may sell securities it owns without regard to the length of time
they have been held. The portfolio's turnover rate is not expected to exceed
150%.

Lars Berkman, Managing Director, Prudential Investments, and Michael Snyder,
Vice President, Prudential Investments, have been co-managers of the High Yield
Bond Portfolio since 1995. Mr. Berkman is also portfolio manager of the
Prudential High Yield Fund and has been employed as a portfolio manager in the
mutual fund unit since 1990. Mr. Snyder is also the portfolio manager of the
High Yield Income Fund, Inc. for Prudential and has been employed as a portfolio
manager in the mutual fund unit since 1987.

DIVERSIFIED STOCK PORTFOLIOS

STOCK INDEX PORTFOLIO. The objective of this portfolio is to achieve investment
results that correspond to the price and yield performance of publicly-traded
common stocks in the aggregate.

The portfolio seeks to achieve this objective by following the policy of
attempting to duplicate the price and yield performance of the Standard & Poor's
500 Composite Stock Price Index (the "S&P 500 Index"), an index which represents
more than 70% of the total market value of all publicly-traded common stocks and
is widely viewed among investors as representative of the performance of
publicly-traded common stocks as a whole. The S&P 500 Index is composed of 500
selected common stocks, over 95% of which are listed on the New York Stock
Exchange ("NYSE"). Standard & Poor's Corporation chooses the stocks to be
included in the index on a statistical basis taking into account market values
and industry diversification. Inclusion in the index in no way implies an
opinion by Standard & Poor's Corporation as to a stock's attractiveness as an
investment. "Standard & Poor's", "Standard & Poor's 500" and "500" are
trademarks of McGraw Hill, Inc. and have been licensed for use by The Prudential
Insurance Company of America and its affiliates and subsidiaries. The Series
Fund is not sponsored, endorsed, sold or promoted by S&P and S&P makes no
representation regarding the advisability of investing in the Series Fund.
Reference is made to the statement of additional information which sets forth
certain additional disclaimers and limitations of liabilities on behalf of S&P.

The S&P 500 Index is a "weighted" index in which the weighting of each stock
depends on its relative total market value: its market price per share times the
number of shares outstanding. Because of this weighting, approximately 11% of
the S&P 500 Index's value is accounted for by the stocks of the five largest
companies by relative market value. As of December 31, 1996 those companies
were: General Electric Co., Coca-Cola Co., Exxon Corp., Intel, and Microsoft
Corp.

This portfolio will not be "managed" in the traditional sense of using economic,
financial or market analysis to determine the stocks to be purchased by the
portfolio. Rather, the portfolio manager will purchase stocks for the portfolio
in proportion to their weighting in the S&P 500 Index. Thus, adverse financial
performance by a company will not result in reduction or elimination of the
portfolio's holdings of its stock and, conversely, superior financial
performance by a company will not lead the portfolio to increase its holdings of
the company's stock. If a stock held by this portfolio is eliminated from the
S&P 500 Index, the portfolio will sell its holdings of the stock regardless of
the prospects of the company. Because the portfolio will not be "managed" in the
traditional sense, portfolio turnover is expected to be low and is generally not
expected to exceed 10%. A 10% portfolio turnover rate would occur if one-tenth
of the portfolio's securities were sold and either repurchased or replaced
within 1 year. Because of the expected low turnover, transaction costs, such as
brokerage commissions, are also expected to be relatively low.

The following table shows the performance of the S&P 500 Index for the 25 years
ending in 1996. The period covered by this table is one of generally rising
stock prices, and the performance of the S&P 500 Index in this period should not
be viewed as a representation of any future performance by that index. In
addition, the fees and costs involved in the operation of the Stock Index
Portfolio mean that the performance of a share of stock in the portfolio may not
equal the performance of the S&P 500 Stock Index even if the assets held by the
portfolio do equal that performance.

19 - Series Fund

<PAGE>

- --------------------------------------------------------------------------------
*S&P 500 WITH DIVIDENDS REINVESTED
Annual Percentage Change
- --------------------------------------------------------------------------------

1972 +18.90 1985 +31.57
1973 -14.77 1986 +18.56
1974 -26.39 1987 +5.10
1975 +37.16 1988 +16.61
1976 +23.57 1989 +31.69
1977 -7.42 1990 -3.10
1978 +6.38 1991 +30.47
1979 +18.20 1992 +7.61
1980 +32.27 1993 +10.08
1981 -5.01 1994 +1.32
1982 +21.44 1995 +37.58
1983 +22.38 1996 +22.96
1984 +6.10

- --------------------------------------------------------------------------------
Source: Standard & Poor's Corporation. Percentage change calculated in
accordance with specifications of SEC release number IA-327.
- --------------------------------------------------------------------------------

In the nine full years since this portfolio was established its total return,
compared to that of the S&P 500 Index, was as follows:

- --------------------------------------------------------------------------------
Annual Percentage Change Total Return
S&P 500 with Stock Index Portfolio
Dividends Reinvested (after deduction of expenses)
- --------------------------------------------------------------------------------

1988 +16.61 +15.44
1989 +31.69 +30.93
1990 -3.10 -3.63
1991 +30.47 +29.72
1992 +7.61 +7.13
1993 +10.08 +9.66
1994 +1.32 +1.01
1995 +37.58 +37.06
1996 +22.96 +22.57

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

Under normal circumstances, the portfolio generally intends to purchase all 500
stocks represented in the S&P 500 Index and to invest its assets as fully in
those stocks (in proportion to their weighting in the index) as is feasible in
light of cash flows into and out of the portfolio. In order to reduce
transaction costs, a weighted investment in the 500 stocks comprising the S&P
500 Index is most efficiently made in relatively large amounts. As additional
cash is received from the purchase of shares in the portfolio, it may be held
temporarily in short-term, high quality investments of the sort in which the
Money Market Portfolio invests, until the portfolio has a sufficient amount of
assets in such investments to make an efficient weighted investment in the 500
stocks comprising the S&P 500 Index. If net cash outflows from the portfolio are
anticipated, the portfolio may sell stocks (in proportion to their weighting in
the S&P 500 Index) in amounts in excess of those needed to satisfy the cash
outflows and hold the balance of the proceeds in short-term investments if such
a transaction appears, taking into account transaction costs, to be more
efficient than selling only the amount of stocks needed to meet the cash
requirements. The portfolio will not, however, increase its holdings of cash in
anticipation of any decline in the value of the S&P 500 Index or of the stock
markets generally. The portfolio will instead remain as fully invested in the
S&P 500 Index stocks as feasible in light of its cash flow patterns during
periods of market declines as well as advances, and investors in the portfolio
thus run the risk of remaining fully invested in common stocks during a period
of general decline in the stock markets.

Tracking accuracy is measured by the difference between total return for the S&P
Index with dividends reinvested and total return for the portfolio with
dividends reinvested before deductions of portfolio fees and expenses. Tracking
accuracy is monitored by the portfolio manager on a daily basis. All tracking
accuracy deviations are reviewed to determine the effectiveness of investment
policies and techniques.

If the portfolio does hold short-term investments as a result of the patterns of
cash flows to and from the portfolio, such holdings may cause its performance to
differ from that of the S&P 500 Index. The portfolio will attempt to minimize
any such difference in performance through transactions involving stock index
futures contracts, options on stock indices, and/or options on stock index
future contracts. These derivative investment instruments are described under
OPTIONS ON STOCK INDICES, FUTURES CONTRACTS, and OPTIONS ON FUTURES CONTRACTS on
pages 30

20 - Series Fund
<PAGE>

through 31. The portfolio will not use such instruments for speculative purposes
or to hedge against any decline in the value of the stocks held in the
portfolio, but instead will employ them only as a temporary substitute for
investment of cash holdings directly in the 500 stocks when the portfolio's cash
holdings are too small to make such an investment in an efficient manner.

For example, if the portfolio's cash reserves are insufficient to invest
efficiently in another unit of the basket of stocks comprising the S&P 500
Index, the portfolio may purchase S&P 500 futures contracts to hedge against a
rise in the value of the stocks the portfolio intends to acquire. In its attempt
to minimize any difference in performance between the portfolio and the S&P 500
Index, the portfolio currently intends to engage in transactions involving the
S&P 500 Index futures contracts, the NYSE Composite Index futures contracts,
options on the S&P 500 Index, the S&P 100 Index, and the NYSE Composite Index,
and options on the S&P 500 Index futures contracts and the NYSE Composite Index
futures contracts. There can be no assurance that the portfolio's attempt to
minimize such performance difference through the use of any of these instruments
will succeed. See the statement of additional information for a more detailed
discussion of the manner in which the portfolio will employ these instruments
and for a description of other risks involved in the use of such instruments.

The above described investment policies and techniques of the Stock Index
Portfolio are non-fundamental and may be changed without shareholder approval if
it is determined that alternative investment techniques would be more effective
in achieving the portfolio's objective.

EQUITY INCOME PORTFOLIO. The objective of this portfolio is both current income
and capital appreciation through investment primarily in common stocks and
convertible securities that provide favorable prospects for investment income
returns above those of the Standard & Poor's 500 Stock Index or the NYSE
Composite Index. In selecting these securities, the portfolio will put emphasis
on earnings, balance sheet and cash flow analysis, and the relationships that
these factors have to the price and return of a given security. Under normal
circumstances, the portfolio intends to invest at least 65% of its total assets
in such securities.

The portfolio may invest the balance of its assets in other stocks, other
securities convertible into common stocks, debt securities (including money
market instruments), options on stocks and stock indices, and stock index
futures. The portfolio may under normal circumstances invest up to 35% of its
total assets in money market instruments of the kind held by the Money Market
Portfolio. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, the Equity
Income Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio.

In addition, up to 35% of the portfolio's total assets may be invested in other
fixed-income obligations including convertible and nonconvertible preferred
stock. The portfolio anticipates that these will primarily be rated A or better
by Moody's or S&P. However, the portfolio may also invest in lower-rated
fixed-income securities, although it will not invest in securities rated lower
than CC or Ca by Moody's or S&P, respectively. The risks of medium to lower
rated securities, also known as high risk securities, are described above in
connection with the High Yield Bond Portfolio. A description of debt ratings is
contained in the Appendix to the statement of additional information. The
portfolio may also invest in non-rated fixed-income securities which, in the
opinion of the manager, are of a quality comparable to rated securities in which
the portfolio may invest.

To the extent permitted by applicable insurance law, the portfolio may invest up
to 30% of its total assets in non-United States currency denominated debt and
equity securities of foreign and U.S. issuers. The particular risks of
investments in foreign securities are described under FOREIGN SECURITIES on page
27.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices and foreign currencies; (ii) purchase and sell stock
index and foreign currency futures contracts and options thereon; (iii) enter
into forward foreign currency exchange contracts; and (iv) purchase securities
on a when-issued or delayed delivery basis. These techniques are described on
pages 28 through 32, and further information about some of them is included in
the statement of additional information.

As a result of its investment policies, the portfolio's turnover rate may exceed
100%, although it is not expected to exceed 200%.

Warren Spitz, Managing Director, Prudential Investments, has been portfolio
manager of the Equity Income Portfolio since 1988. Mr. Spitz is also the
portfolio manager of the Prudential Equity Income Fund.

EQUITY PORTFOLIO. The objective of this portfolio is to achieve capital
appreciation through investment primarily in common stocks of companies,
including major established corporations as well as smaller capitalization
companies, that appear to offer attractive prospects of price appreciation that
is superior to broadly-based stock indices. Current income, if any, is
incidental.

Although the portfolio will be invested primarily in common stocks, it may also
invest to a limited extent in short, intermediate or long term debt, either
convertible or nonconvertible into common stock, as well as in nonconvertible
preferred stock. In addition, it may also invest up to 5% of its assets in below
investment grade debt securities.

21 - Series Fund
<PAGE>

The risks of medium to lower rated securities, also known as high risk
securities, are described above in connection with the High Yield Bond
Portfolio. A description of corporate bond ratings is contained in the Appendix
to the statement of additional information. The portfolio will attempt to
maintain a flexible approach to the selection of common stocks of various types
of companies whose valuations appear to offer opportunities for above-average
appreciation. Thus, the portfolio may invest in securities of companies whose
estimated growth in earnings exceeds that projected for the market as a whole
because of factors such as expanding market share, new products or changes in
market environment. Or it may invest in "undervalued" securities which are often
characterized by a lack of investor recognition of the basic value of a
company's assets. Securities of companies with sales and earnings trends which
are currently unfavorable but which are expected to reverse may also be in the
portfolio. The effort to achieve price appreciation that is superior to broadly
based stock indices necessarily involves accepting a greater risk of declining
values. During periods when stock prices decline generally, it can be expected
that the value of the portfolio will also decline.

To the extent permitted by applicable insurance law, this portfolio may invest
up to 30% of its total assets in non-United States currency denominated common
stock and fixed-income securities convertible into common stock of foreign and
U.S. issuers. The particular risks of investments in foreign securities are
described under FOREIGN SECURITIES on page 27.

A portion of the portfolio may be invested in money market instruments of the
kind held by the Money Market Portfolio in order to make effective use of cash
reserves pending investment in common stocks. Moreover, when conditions dictate
a temporary defensive strategy or during temporary periods of portfolio
structuring and restructuring, the Equity Portfolio may invest, without limit,
in high quality money market instruments of the kind held by the Money Market
Portfolio.

Thomas Jackson, Managing Director, Prudential Investments, has been portfolio
manager of the Equity Portfolio since 1990. Mr. Jackson is also portfolio
manager of the Prudential Equity Fund, Inc.

PRUDENTIAL JENNISON PORTFOLIO. The objective of the Prudential Jennison
Portfolio is to achieve long-term growth of capital through investment primarily
in equity securities of established companies with above-average growth
prospects. Current income, if any, is incidental.

In order to achieve this objective, the Prudential Jennison Portfolio will
follow a policy of selecting stocks on a company-by-company basis primarily
through the use of fundamental analysis. The portfolio manager will look for
companies that have demonstrated growth in earnings and sales, high returns on
equity and assets, or other strong financial characteristics, and in the opinion
of the portfolio manager, are attractively valued. These companies tend to have
a unique market niche, a strong new product profile or superior management.
Under normal market conditions, at least 65% of the value of the total assets of
the portfolio will be invested in common stocks and preferred stocks of
companies which exceed $1 billion in market capitalization.

The portfolio may invest up to 35% of its total assets in: (i) common stocks,
preferred stocks, and other equity-related securities of companies that are
undergoing changes in management or product and marketing dynamics which have
not yet been reflected in reported earnings but which are expected to impact
earnings in the intermediate term--these securities often lack investor
recognition and are often favorably valued; (ii) other equity-related
securities; (iii) with respect to a maximum of 30% of its total assets, common
stocks, preferred stocks and other equity-related securities of non-United
States currency denominated issuers or American Depository Receipts ("ADRs");
(iv) investment grade fixed income securities and mortgage-backed securities,
including lower rated securities [rated in the fourth highest rating category by
a nationally recognized rating service (e.g. Baa by Moody's Investor Services or
BBB by Standard & Poor's)] or, if not rated, determined by the portfolio manager
to be of comparable quality to securities so rated (a description of debt
ratings is contained in the Appendix to the statement of additional
information); and (v) obligations issued or guaranteed by the U.S. Government,
its agencies and instrumentalities.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices, and foreign currencies; (ii) lend its portfolio
securities; (iii) purchase and sell stock index and foreign currency futures
contracts and options thereon; (iv) enter into forward foreign currency exchange
contracts; and (v) enter into repurchase agreements and purchase securities on a
when-issued or delayed delivery basis. These techniques are described on pages
28 through 32, and further information about some of them is included in the
statement of additional information.

22 - Series Fund
<PAGE>

The effort to achieve superior investment returns necessarily involves a risk of
exposure to declining values. Securities in which the portfolio may primarily
invest have historically been more volatile than the Standard & Poor's 500
Composite Stock Price Index. Accordingly, during periods when stock prices
decline generally, it can be expected that the value of the portfolio will
decline more than the market indices.

David Poiesz, Director and Senior Vice President of Jennison Associates Capital
Corp. ("Jennison"), is the portfolio manager, and Peter Reinemann, Director and
Senior Vice President of Jennison, is the associate portfolio manager of the
Prudential Jennison Portfolio. Mr. Poiesz is responsible for the day to day
management of the portfolio and has been portfolio manager of the Prudential
Jennison Portfolio since its inception in 1995. Mr. Poiesz also manages the
Prudential Jennison Growth Fund. Mr. Poiesz joined Jennison in 1983 as an equity
research analyst and has been an equity portfolio manager since 1991. Mr.
Reinemann is also the associate portfolio manager for the Prudential Jennison
Growth Fund, the Prudential Jennison Growth & Income Fund, and the Prudential
Active Balanced Fund. Mr. Reinemann has been with Jennison since 1992 as an
associate portfolio manager. Prior to 1992, he served as a Vice President at
Paribas Asset Management, Inc.

SMALL CAPITALIZATION STOCK PORTFOLIO. The objective of this portfolio is to
achieve long-term growth of capital through investment primarily in equity
securities of publicly-traded companies with small market capitalization.
Current income, if any, is incidental.

The portfolio seeks to achieve this objective by following the policy of
attempting to duplicate the price and yield performance of the Standard & Poor's
Small Capitalization Stock Index (the "S&P SmallCap 600 Index"), an index which
consists of six-hundred smaller capitalization domestic stocks chosen for market
size, liquidity, and industry group representation. Stocks in the index have
market capitalizations between $35 million and $1.215 billion. However, to be
included in the index, stock selections are also screened for trading volume,
share turnover, ownership concentration, share price and bid/ask spreads. The
initial sector weightings were selected to reflect the industry distribution of
all small capitalization stocks followed by S&P. The S&P SmallCap 600 Index has
above average risk and may fluctuate more than the S&P 500 Index which invests
in stocks of larger, more established firms.

The S&P SmallCap 600 Index is a market weighted index (stock price times shares
outstanding), with each stock affecting the index in proportion to its market
value. Standard & Poor's Corporation is responsible for selecting and
maintaining the list of stocks to be included in the index. Inclusion in the
index in no way implies an opinion by Standard & Poor's Corporation as to a
stock's attractiveness as an investment. "Standard & Poor's", "Standard & Poor's
Small Capitalization Stock Index" and "Standard & Poor's SmallCap 600" are
trademarks of McGraw Hill, Inc. The Series Fund is not sponsored, endorsed, sold
or promoted by S&P and S&P makes no representation regarding the advisability of
investing in the Series Fund. Reference is made to the statement of additional
information which sets forth certain additional disclaimers and limitations of
liabilities on behalf of S&P.

The following table shows the performance of the S&P SmallCap 600 Index for the
10 years ending in 1996. Although the index was first published in 1994, S&P
reconstructed its performance for earlier years. The performance of the S&P
SmallCap 600 Index in this period should not be viewed as a representation of
any future performance by that index. In addition, the fees and costs involved
in the operation of the Small Capitalization Stock Portfolio mean that the
performance of a share of stock in the portfolio may not equal the performance
of the S&P SmallCap 600 Stock Index even if the assets held by the portfolio do
equal that performance.

23 - Series Fund
<PAGE>

- --------------------------------------------------------------------------------
S&P SmallCap 600 With Dividends Reinvested
Annual Percentage Change
- --------------------------------------------------------------------------------

1987 -13.50
1988 +19.49
1989 +13.89
1990 -9.90
1991 +48.49
1992 +21.04
1993 +18.79
1994 -4.77
1995 +29.96
1996 +21.32

Under normal circumstances, this portfolio intends to be invested in all or a
representative sample of the stocks in the S&P SmallCap 600 Index. The portfolio
may hold cash or its equivalent, these holdings may cause its performance to
differ from that of the S&P SmallCap 600 Index. The portfolio will attempt to
minimize any such differences in performance through transactions involving
stock index futures contracts, options on stock indices, and/or options on stock
index future contracts. These investment instruments are described under OPTIONS
ON STOCK INDICES, FUTURES CONTRACTS, and OPTIONS ON FUTURES CONTRACTS on pages
30 through 31.

In addition, the portfolio may: (i) purchase and sell options on equity
securities; (ii) lend its portfolio securities; and (iii) purchase securities on
a when-issued or delayed delivery basis. These techniques are described on pages
28 through 32, and further information about some of them is included in the
statement of additional information.

The investment policies and techniques of the Small Capitalization Stock
Portfolio are not fundamental and may be changed without shareholder approval if
it is determined that alternative investment techniques would be more effective
in achieving the portfolio's objective.

Wai Chiang, Director of Portfolio Management, Prudential Diversified Investment
Strategies, has been portfolio manager of the Small Capitalization Stock
Portfolio since its inception in 1995. Mr. Chiang also manages the unregistered
commingled domestic equity index separate accounts, Pridex and Pridex 500 for
Prudential. Mr. Chiang has been employed by Prudential as a portfolio manager
since 1986.

GLOBAL PORTFOLIO. The objective of this portfolio is long-term growth of capital
through investment primarily in common stocks and common stock equivalents (such
as convertible debt securities) of foreign and domestic issuers. Current income,
if any, is incidental.

The portfolio is intended to provide investors with the opportunity to invest in
a portfolio of securities of companies located throughout the world. In making
the allocation of assets among the various countries and geographic regions, the
portfolio manager ordinarily considers such factors as prospects for relative
economic growth between foreign countries; expected levels of inflation and
interest rates; government policies influencing business conditions; the range
of individual investment opportunities available to international investors; and
other pertinent financial, tax, social, political and national factors--all in
relation to the prevailing prices of the securities in each country or region.

There are, generally, no geographic limitations on companies in which the
portfolio may invest. Depending upon market conditions, the portfolio may be
invested primarily in foreign securities. Investments may be made in companies
based in the Pacific Basin (for example, Japan, Australia, New Zealand,
Singapore, Malaysia, and Hong Kong) and Western Europe (for example, the United
Kingdom, Spain, Germany, Switzerland, the Netherlands, France, and Scandinavia),
as well as the United States, Canada, and such other areas and countries as the
portfolio manager may determine from time to time. The portfolio may seek to
hedge its position in foreign currencies as more fully described herein.

The portfolio is not required to maintain any particular geographic or currency
mix of its investments. The portfolio intends to maintain investments in at
least three countries (including the United States), but may, when market
conditions warrant, invest up to 35% of its assets in companies located in any
one country (other than the United States).

24 - Series Fund
<PAGE>

In analyzing companies for investment, the portfolio manager ordinarily looks
for one or more of the following characteristics: prospects for above-average
earnings growth per share; high return on invested capital; healthy balance
sheet; sound financial and accounting policies and overall financial strength;
strong competitive advantages; effective research and product development and
marketing; efficient service; pricing flexibility; strength of management; and
general operating characteristics which will enable the companies to compete
successfully in their marketplace--all in relation to the prevailing prices of
the securities of such companies.

Investing in securities of foreign companies and countries involves special
risks. The particular risks of investments in foreign securities are described
under FOREIGN SECURITIES on page 27.

When conditions dictate a temporary defensive strategy or during temporary
periods of portfolio structuring and restructuring, the Global Portfolio may
invest, without limit, in high quality money market instruments of the kind held
by the Money Market Portfolio.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices and foreign currencies; (ii) purchase and sell stock
index, interest rate and foreign currency futures contracts and options thereon;
(iii) enter into forward foreign currency exchange contracts; and (iv) purchase
securities on a when-issued or delayed delivery basis. These techniques are
described on pages 27 through 32, and further information about some of them is
included in the statement of additional information.

The operating expense ratio of the portfolio can be expected to be significantly
higher than that of a fund investing exclusively in domestic securities since
the expenses of the portfolio, such as custodial, valuation and communication
costs, as well as the rate of the investment management fee (0.75% of the
portfolio's average daily net assets), though similar to such expenses of other
global funds, are higher than those generally incurred by funds investing solely
in the securities of U.S. issuers.

As a result of its investment policies, the portfolio's turnover rate may exceed
100% although it is not expected to exceed 200%.

Daniel Duane, Managing Director, Prudential Investments, has been the portfolio
manager of the Global Portfolio since 1990. Mr. Duane also manages several
mutual funds including the Prudential Global Fund, Inc.

SPECIALIZED PORTFOLIOS

NATURAL RESOURCES PORTFOLIO. The objective of this portfolio is long-term growth
of capital through investment primarily in common stocks and convertible
securities of "natural resource companies" (as defined below) and in securities
(typically debt securities and preferred stocks) the terms of which are related
to the market value of some natural resource ("asset-indexed securities"). Under
normal circumstances, the portfolio will invest at least 65% of its total assets
in such securities.

Companies that primarily own, explore, mine, process or otherwise develop
natural resources, or supply goods and services primarily to such companies,
will be considered "natural resource companies." Natural resources generally
include precious metals (e.g., gold, silver and platinum), ferrous and
nonferrous metals (e.g., iron, aluminum and copper), strategic metals (e.g.,
uranium and titanium), hydrocarbons (e.g., coal, oil and natural gases), timber
land, undeveloped real property and agricultural commodities.

The value of equity securities of natural resource companies (including those
companies that are primarily involved in providing goods and services to natural
resource companies) will fluctuate pursuant to market conditions generally, as
well as to the market for the particular natural resource in which the issuer is
involved. In addition, the values of natural resources are affected by numerous
factors including events occurring in nature, inflationary pressures and
international politics. For instance, events in nature (such as earthquakes or
fires in prime natural resource areas) and political events (such as coups or
military confrontations) can affect the overall supply of a natural resource and
thereby the value of companies involved in such natural resources. In addition,
rising interest rates (i.e., inflationary pressures) may affect the demand for
natural resources such as timber. The portfolio manager will seek securities
that are attractively priced relative to the intrinsic values of the relevant
natural resource or that are of companies which are positioned to benefit under
existing or anticipated economic conditions. Accordingly, the portfolio may
shift its emphasis from one natural resource industry to another depending upon
prevailing trends or developments, provided that the portfolio will not invest
25% or more of its total assets in the securities of companies in any one
natural resource industry. See INVESTMENT RESTRICTIONS in the statement of
additional information for information concerning the industry classifications.
The portfolio is not required to maintain any particular mix of investments
among the natural resource industries.

In addition to common stocks and common stock equivalents, the portfolio may
invest in securities, the principal amount, redemption terms or conversion terms
of which are related to the market price of a natural resource asset, referred
to herein as "asset-indexed securities." The portfolio expects to purchase
asset-indexed securities which are rated, or are issued by issuers that have
outstanding obligations which are rated, at least BBB or Baa by S&P or Moody's,
respectively, or commercial paper rated at least A-2 or P-2 by S&P or Moody's,
respectively, or in

25 - Series Fund
<PAGE>

unrated securities that the portfolio manager has determined to be of comparable
quality. The portfolio reserves the right, however, to invest in asset-indexed
securities rated as low as CC or Ca by Moody's or S&P, respectively, or in
unrated securities of comparable quality, also known as high risk securities. A
description of security ratings is set forth in the Appendix to the statement of
additional information. If the asset-indexed security is backed by a letter of
credit or other similar instrument, the manager may take such backing into
account in determining the quality of the security.

Although it is expected that the market prices of the asset-indexed securities
will fluctuate on the basis of the natural resources on which such securities
are based, there may not be a perfect correlation between the price movements of
the asset-indexed securities and the underlying natural resources. Asset-indexed
securities are not always secured with a security interest in the underlying
natural resource asset. Further, asset-indexed securities typically bear
interest or pay dividends at below market rates (and in certain cases at nominal
rates). Although the value of asset-indexed securities that bear interest may
fluctuate inversely with market interest rates, such fluctuations are
anticipated generally to be minimal since the value of such securities is
typically based on the natural resources on which the securities are based.

Certain asset-indexed securities may be payable at maturity in cash, or, at the
option of the holder, directly in a stated amount of the asset to which the
securities are related. The portfolio does not intend to invest directly in
natural resources and, therefore, would elect to be paid in cash or would
attempt to sell the asset-indexed security prior to maturity to realize the
appreciation in the underlying asset.

As indicated above, the portfolio intends to invest primarily in common stocks
and convertible securities of natural resource companies and asset-indexed
securities. The portfolio may invest the balance of its assets in other stocks,
other securities convertible into common stocks, debt securities (including
money market instruments), and options on stocks and on natural resource-related
stock indices. The portfolio may under normal circumstances invest up to 35% of
its total assets in money market instruments of the type held by the Money
Market Portfolio. Moreover, when conditions dictate a temporary defensive
strategy or during temporary periods of portfolio structuring and restructuring,
the Natural Resources Portfolio may invest, without limit, in high quality money
market instruments of the kind held by the Money Market Portfolio. In addition,
up to 35% of the portfolio's total assets may be invested in other fixed-income
obligations. The portfolio anticipates that these will primarily be rated A or
better by Moody's or S&P. However, the portfolio may also invest in lower-rated
fixed-income securities, also known as high risk securities, although it will
not invest in securities rated lower than CC or Ca by Moody's or S&P,
respectively. The portfolio may also invest in non-rated fixed-income securities
which, in the opinion of the manager, are of a quality comparable to rated
securities in which the portfolio may invest.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices and foreign currencies; (ii) purchase and sell stock
index and foreign currency futures contracts and options thereon; (iii) enter
into forward foreign currency exchange contracts; and (iv) purchase securities
on a when-issued or delayed delivery basis. These techniques are described on
pages 28 through 33, and further information about some of them is included in
the statement of additional information.

As a result of its investment policies, the portfolio's turnover rate may exceed
100%, although it is not expected to exceed 200%.

Leigh Goehring, Vice President, Prudential Investments, has been portfolio
manager of the Natural Resources Portfolio since 1992. Mr. Goehring also manages
the Prudential Natural Resources Fund, Inc. Prior to 1992, Mr. Goehring was
portfolio manager of The Prudential-Bache Option Growth Fund.

CONVERTIBLE SECURITIES

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Small Capitalization Stock, Global, and Natural Resources Portfolios
may invest in convertible securities and such securities may constitute a major
part of the holdings of the Equity Income, Global and Natural Resources
Portfolios. A convertible security is a fixed-income security (a bond or
preferred stock) which may be converted at a stated price within a specified
period of time into a certain quantity of the common stock of the same or a
different issuer. Convertible securities are senior to common stocks in a
corporation's capital structure, but are usually subordinated to similar
nonconvertible securities. While providing a fixed income stream (generally
higher in yield than the income derivable from a common stock but lower than
that afforded by a similar nonconvertible security), a convertible security also
affords an investor the opportunity, through its conversion feature, to
participate in the capital appreciation attendant upon a market price advance in
the convertible security's underlying common stock. The price of a convertible
security tends to increase as the market value of the underlying stock rises,
whereas it tends

26 - Series Fund
<PAGE>

to decrease as the market value of the underlying stock declines. While no
securities investment is without risk, investments in convertible securities
generally entail less risk than investments in the common stock of the same
issuer.

LOAN PARTICIPATIONS

The Diversified Bond, Conservative Balanced and Flexible Managed Portfolios may
invest in fixed and floating rate loans (Loans) arranged through private
negotiations between a corporate borrower and one or more financial institutions
(Lenders). The portfolios may invest in such Loans generally in the form of
participations in Loans (Participations). Participations typically will result
in the Series Fund having a contractual relationship only with the Lender, not
with the borrower. The Series Fund will have the right to receive payments of
principal, interest and any fees to which it is entitled only from the Lender
selling the Participation and only upon receipt by the Lender of the payments
from the borrower. In connection with purchasing Participations, the Series Fund
generally will have no right to enforce compliance by the borrower with the
terms of the loan agreement relating to the Loan, nor any rights of set-off
against the borrower, and the Series Fund may not benefit directly from any
collateral supporting the Loan in which it has purchased the Participation. As a
result, the Series Fund will assume the credit risk of both the borrower and the
Lender that is selling the Participation. In the event of the insolvency of the
Lender selling a Participation, the Series Fund may be treated as a general
creditor of the Lender and may not benefit from any set-off between the Lender
and the borrower.

FOREIGN SECURITIES

The Global Portfolio may invest up to 100% of its total assets in common stock
and convertible securities denominated in a foreign currency and issued by
foreign or domestic issuers. The Diversified Bond and High Yield Bond Portfolios
may each invest up to 20% of their assets in United States currency denominated
debt securities issued outside the United States by foreign or domestic issuers.
In addition, the bond components of the Conservative Balanced and Flexible
Managed Portfolios may each invest up to 20% of their assets in such securities.
To the extent permitted by applicable law, the Conservative Balanced, Flexible
Managed, and Equity Income Portfolios may invest up to 30% of their total assets
in debt and equity securities denominated in a foreign currency and issued by
foreign or domestic issuers. Further, to the extent permitted by applicable
insurance law, the Equity, Prudential Jennison, and Natural Resources Portfolios
may invest up to 30% of their total assets in non-United States currency
denominated common stock and fixed-income securities convertible into common
stock of foreign and U.S. issuers. Securities issued outside the United States
and not publicly traded in the United States, as well as American Depository
Receipts ("ADRs"), and securities denominated in a foreign currency are referred
to collectively in this prospectus as "foreign securities."

ADRs are U.S. dollar-denominated certificates issued by a United States bank or
trust company and represent the right to receive securities of a foreign issuer
deposited in a domestic bank or foreign branch of a United States bank and
traded on a United States exchange or in an over-the-counter market. Investment
in ADRs has certain advantages over direct investment in the underlying foreign
securities because they are easily transferable, have readily available market
quotations, and the foreign issuers are usually subject to comparable auditing,
accounting, and financial reporting standards as domestic issuers.

Foreign securities involve certain risks, which should be considered carefully
by an investor. These risks include political or economic instability in the
country of the issuer, the difficulty of predicting international trade
patterns, the possibility of imposition of exchange controls and, in the case of
securities not denominated in United States currency, the risk of currency
fluctuations. Such securities may be subject to greater fluctuations in price
than domestic securities. Under certain market conditions, foreign securities
may be less liquid than domestic securities. In addition, there may be less
publicly available information about a foreign company than about a domestic
company. Foreign companies generally are not subject to uniform accounting,
auditing, and financial reporting standards comparable to those applicable to
domestic companies. There is generally less government regulation of securities
exchanges, brokers, and listed companies abroad than in the United States, and,
with respect to certain foreign countries, there is a possibility of
expropriation, confiscatory taxation or diplomatic developments which could
affect investment in those countries. Finally, in the event of a default of any
foreign debt obligations, it may be more difficult for a portfolio to obtain or
to enforce a judgment against the issuers of such securities.

27 - Series Fund
<PAGE>

or other assets denominated in that currency. See FORWARD FOREIGN CURRENCY
EXCHANGE CONTRACTS in the statement of additional information. In addition, the
portfolios may, for hedging purposes, enter into certain transactions involving
options on foreign currencies, foreign currency futures contracts and options on
foreign currency futures contracts. See OPTIONS ON FOREIGN CURRENCIES, FUTURES
CONTRACTS, AND OPTIONS ON FUTURES CONTRACTS on pages 30 through 31.

OPTIONS ON EQUITY SECURITIES

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Small Capitalization Stock, Global, and Natural Resources Portfolios
may purchase and write (i.e., sell) put and call options on equity securities
that are traded on securities exchanges, are listed on the National Association
of Securities Dealers Automated Quotation System ("NASDAQ"), or that result from
privately negotiated transactions with broker-dealers ("OTC options"). A call
option is a short-term contract pursuant to which the purchaser or holder, in
return for a premium paid, has the right to buy the equity security underlying
the option at a specified exercise price at any time during the term of the
option. The writer of the call option, who receives the premium, has the
obligation, upon exercise of the option, to deliver the underlying equity
security against payment of the exercise price. A put option is a similar
contract which gives the purchaser or holder, in return for a premium, the right
to sell the underlying equity security at a specified price during the term of
the option. The writer of the put, who receives the premium, has the obligation
to buy the underlying equity security at the exercise price upon exercise by the
holder of the put.

A portfolio will write only "covered" options on stocks. A call option is
covered if: (1) the portfolio owns the security underlying the option; or (2)
the portfolio has an absolute and immediate right to acquire that security
without additional cash consideration (or for additional cash consideration held
in a segregated account by its custodian) upon conversion or exchange of other
securities it holds; or (3) the portfolio holds on a share-for-share basis a
call on the same security as the call written where the exercise price of the
call held is equal to or less than the exercise price of the call written or
greater than the exercise price of the call written if the difference is
maintained by the portfolio in cash, Treasury bills or other high grade
short-term debt obligations in a segregated account with its custodian. A put
option is covered if: (1) the portfolio deposits and maintains with its
custodian in a segregated account cash, U.S. Government securities or other
liquid unencumbered assets having a value equal to or greater than the exercise
price of the option; or (2) the portfolio holds on a share-for-share basis a put
on the same security as the put written where the exercise price of the put held
is equal to or greater than the exercise price of the put written or less than
the exercise price if the difference is maintained by the portfolio in cash,
Treasury bills or other high grade short-term debt obligations in a segregated
account with its custodian.

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Small Capitalization Stock, Global, and Natural Resources Portfolios
may also purchase "protective puts" (i.e., put options acquired for the purpose
of protecting a portfolio security from a decline in market value). In exchange
for the premium paid for the put option, the portfolio acquires the right to
sell the underlying security at the exercise price of the put regardless of the
extent to which the underlying security declines in value. The loss to the
portfolio is limited to the premium paid for, and transaction costs in
connection with, the put plus the initial excess, if any, of the market price of
the underlying security over the exercise price. However, if the market price of
the security underlying the put rises, the profit the portfolio realizes on the
sale of the security will be reduced by the premium paid for the put option less
any amount (net of transaction costs) for which the put may be sold. Similar
principles apply to the purchase of puts on debt securities and stock indices,
as described under OPTIONS ON DEBT SECURITIES, page 29 and OPTIONS ON STOCK
INDICES, page 30.

These portfolios may purchase call options for hedging and investment purposes.
No portfolio intends to invest more than 5% of its net assets at any one time in
the purchase of call options on stocks. These portfolios may also purchase
putable and callable equity securities, which are securities coupled with a put
or a call option provided by the issuer.

If the writer of an exchange-traded option wishes to terminate the obligation,
he or she may effect a "closing purchase transaction" by buying an option of the
same series as the option previously written. Similarly, the holder of an
exchange-traded option may liquidate his or her position by exercise of the
option or by effecting a "closing sale transaction" by selling an option of the
same series as the option previously purchased. A portfolio will realize a
profit from a closing transaction if the price of the transaction is less than
the premium received from writing the option or is more than the premium paid to
purchase the option. Because increases in the market price of a call option will
generally reflect increases in the market price of the underlying security, any
loss resulting from a closing purchase transaction with respect to a call option
is likely to be offset in whole or in part by appreciation of the underlying
equity security owned by the portfolio. Unlike exchange-traded options, OTC
options generally do not have a continuous liquid market. Consequently, the
portfolio will generally be able to realize the value of an OTC option it has
purchased only by exercising it or reselling it to the dealer who issued it.
Similarly, when the portfolio writes an OTC option, it generally will be able to
close out the OTC option prior to its expiration only by

28 - Series Fund
<PAGE>

entering into a closing purchase transaction with the dealer to which the
portfolio originally wrote the OTC option. There is, in general, no guarantee
that closing purchase or closing sale transactions can be effected.

There are certain special risks associated with the portfolios' transactions in
stock options, in addition to a risk that the market value of the security will
move adversely to the portfolio's option position. These risks, which relate
primarily to liquidity, are discussed in the statement of additional
information.

OPTIONS ON DEBT SECURITIES

The Diversified Bond, Government Income, Conservative Balanced, Flexible
Managed, and High Yield Bond Portfolios may purchase and write (i.e. sell) put
and call options on debt securities (including U.S. Government debt securities)
that are traded on U.S. securities exchanges or that result from privately
negotiated transactions with primary U.S. Government securities dealers
recognized by the Federal Reserve Bank of New York ("OTC options"). Options on
debt are similar to options on stock, except that the option holder has the
right to take or make delivery of a debt security, rather than stock.

A portfolio will write only "covered" options. Options on debt securities are
covered in the same manner as options on stocks, discussed above, except that,
in the case of call options on U.S. Treasury Bills, the portfolio might own U.S.
Treasury Bills of a different series from those underlying the call option, but
with a principal amount and value corresponding to the option contract amount
and a maturity date no later than that of the securities deliverable under the
call option. The principal reason for a portfolio to write an option on one or
more of its securities is to realize through the receipt of the premiums paid by
the purchaser of the option a greater current return than would be realized on
the underlying security alone. Calls on debt securities will not be written
when, in the opinion of Prudential, interest rates are likely to decline
significantly, because under those circumstances the premium received by writing
the call likely would not fully offset the foregone appreciation in the value of
the underlying security.

These portfolios may also write straddles (i.e., a combination of a call and a
put written on the same security at the same strike price where the same issue
of the security is considered "cover" for both the put and the call). In such
cases, the portfolio will also segregate or deposit for the benefit of the
portfolio's broker cash or liquid high-grade debt obligations equivalent to the
amount, if any, by which the put is "in the money." It is contemplated that each
portfolio's use of straddles will be limited to 5% of the portfolio's net assets
(meaning that the securities used for cover or segregated as described above
will not exceed 5% of the portfolio's net assets at the time the straddle is
written). The writing of a call and a put on the same security at the same
strike price where the call and the put are covered by different securities is
not considered a straddle for purposes of this limit.

These portfolios may purchase "protective puts" in an effort to protect the
value of a security that it owns against a substantial decline in market value.
Protective puts are described in OPTIONS ON EQUITY SECURITIES, page 28. A
portfolio may wish to protect certain portfolio securities against a decline in
market value at a time when put options on those particular securities are not
available for purchase. A portfolio may therefore purchase a put option on
securities other than those it wishes to protect even though it does not hold
such other securities in its portfolio. While changes in the value of the put
option should generally offset changes in the value of the securities being
hedged, the correlation between the two values may not be as close in these
transactions as in transactions in which the portfolio purchases a put option on
an underlying security it owns.

These portfolios may also purchase call options on debt securities for hedging
or investment purposes. No portfolio currently intends to invest more than 5% of
its net assets at any one time in the purchase of call options on debt
securities. A portfolio may also purchase putable and callable debt securities,
which are securities coupled with a put or call option provided by the issuer.

If the writer of an exchange-traded option wishes to terminate the obligation,
he or she may effect a "closing purchase transaction" or a "closing sale
transaction" in a manner similar to that discussed above in connection with
options on equity securities.

The staff of the Securities and Exchange Commission has taken the position that
purchased OTC options and the assets used as "cover" for written OTC options are
illiquid for purposes of a portfolio's 15% limitation on investment in illiquid
securities. However, pursuant to the terms of certain no-action letters issued
by the staff, the securities used as cover for written OTC options may be
considered liquid provided that the portfolio sells OTC options only to
qualified dealers who agree that the portfolio may repurchase any OTC option it
writes for a maximum price to be calculated by a predetermined formula. In such
cases, the OTC option would be considered illiquid only to the extent that the
maximum repurchase price under the formula exceeds the intrinsic value of the
option.

There are certain risks associated with the portfolios' transactions in debt
options, in addition to a risk that the market value of the security will move
adversely to the portfolio's option position. These risks, which relate
primarily to liquidity, are discussed in the statement of additional
information.

29 - Series Fund
<PAGE>

OPTIONS ON STOCK INDICES

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Global, and Natural Resources Portfolios may purchase and sell put and
call options on stock indices traded on securities exchanges, listed on NASDAQ
or that result from privately negotiated transactions with broker-dealers ("OTC
options"). The Stock Index and Small Capitalization Stock Portfolios may utilize
options on stock indices by constructing "put/call" combinations that are
economically comparable to a long stock index futures position, as described in
the statement of additional information. Options on stock indices are similar to
options on stock except that, rather than the right to take or make delivery of
stock at a specified price, an option on a stock index gives the holder the
right to receive, upon exercise of the option, an amount of cash if the closing
level of the stock index upon which the option is based is greater than, in the
case of a call, or less than, in the case of a put, the exercise price of the
option. This amount of cash is equal to such difference between the closing
price of the index and the exercise price of the option expressed in dollars
times a specified multiple (the "multiplier"). The writer of the option is
obligated, in return for the premium received, to make delivery of this amount.
Unlike stock options, all settlements are in cash, and gain or loss depends on
price movements in the stock market generally (or in a particular industry or
segment of the market) rather than price movements in individual stocks.

The multiplier for an index option performs a function similar to the unit of
trading for a stock option. It determines the total dollar value per Contract of
each point in the difference between the exercise price of an option and the
current level of the underlying index. A multiplier of 100 means that a
one-point difference will yield $100. Options on different indices may have
different multipliers.

A portfolio will write only "covered" options on stock indices. The manner in
which these options are covered is discussed in the statement of additional
information.

These portfolios may purchase put and call options for hedging and investment
purposes. No portfolio intends to invest more than 5% of its net assets at any
time in the purchase of puts and calls on stock indices. A portfolio may effect
closing sale and purchase transactions involving options on stock indices, as
described above in connection with stock options.

OPTIONS ON FOREIGN CURRENCIES

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Global, and Natural Resources Portfolios may purchase and write put
and call options on foreign currencies traded on U.S. or foreign securities
exchanges or boards of trade for hedging purposes in a manner similar to that in
which forward foreign currency exchange contracts (discussed under FOREIGN
SECURITIES, page 27 and futures contracts on foreign currencies (discussed under
FUTURES CONTRACTS, page 31) will be employed. Options on foreign currencies are
similar to options on stock, except that the option holder has the right to take
or make delivery of a specified amount of foreign currency, rather than stock.

A portfolio may purchase and write options to hedge the portfolio's securities
denominated in foreign currencies. If there is a decline in the dollar value of
a foreign currency in which the portfolio's securities are denominated, the
dollar value of such securities will decline even though the foreign currency
value remains the same. To hedge against the decline of the foreign currency, a
portfolio may purchase put options on such foreign currency. If the value of the
foreign currency declines, the gain realized on the put option would offset, in
whole or in part, the adverse effect such decline would have on the value of the
portfolio's securities. Alternatively, a portfolio may write a call option on
the foreign currency. If the foreign currency declines, the option would not be
exercised and the decline in the value of the portfolio securities denominated
in such foreign currency would be offset in part by the premium the portfolio
received for the option.

If, on the other hand, the portfolio manager anticipates purchasing a foreign
security and also anticipates a rise in such foreign currency (thereby
increasing the cost of such security), a portfolio may purchase call options on
the foreign currency. The purchase of such options could offset, at least
partially, the effects of the adverse movements of the exchange rates.
Alternatively, a portfolio could write a put option on the currency and, if the
exchange rates move as anticipated, the option would expire unexercised.

A portfolio's successful use of currency exchange options on foreign currencies
depends upon the manager's ability to predict the direction of the currency
exchange markets and political conditions, which requires different skills and
techniques than predicting changes in the securities markets generally. For
instance, if the currency being hedged has moved in a favorable direction, the
corresponding appreciation of the portfolio's securities denominated in such
currency would be partially offset by the premiums paid on the options. Further,
if the currency exchange rate does not change, the portfolio net income would be
less than if the portfolio had not hedged since there are costs associated with
options.

30 - Series Fund
<PAGE>

the currency risks associated with investments in foreign securities, not market
risks. The portfolio's ability to establish and maintain positions will depend
on market liquidity. The ability of the portfolio to close out an option depends
upon a liquid secondary market. There is no assurance that liquid secondary
markets will exist for any particular option at any particular time.

FUTURES CONTRACTS

The Conservative Balanced, Flexible Managed, Stock Index, Equity Income, Equity,
Prudential Jennison, Small Capitalization Stock, Global, and Natural Resources
Portfolios may, to the extent permitted by applicable regulations, attempt to
reduce the risk of investment in equity securities by hedging a portion of their
equity portfolios through the use of stock index futures contracts. A stock
index futures contract is an agreement in which the seller of the contract
agrees to deliver to the buyer an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index is
made.

The Diversified Bond, Government Income, Conservative Balanced, Flexible
Managed, High Yield Bond, and Global Portfolios may, to the extent permitted by
applicable regulations, purchase and sell for hedging purpose futures contracts
on interest-bearing securities (such as U.S. Treasury bonds and notes) or
interest rate indices (referred to collectively as "interest rate futures
contracts").

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Global, and Natural Resources Portfolios may, to the extent permitted
by applicable regulations, purchase and sell futures contracts on foreign
currencies or groups of foreign currencies for hedging purposes.

When the futures contract is entered into, each party deposits with a futures
commission merchant (or in a segregated custodial account) approximately 5% of
the contract amount, called the "initial margin." Subsequent payments to and
from the futures commission merchant, called the "variation margin," will be
made on a daily basis as the underlying security, index or rate fluctuates
making the long and short positions in the futures contracts more or less
valuable, a process known as "marking to the market." The Board of Directors
currently intends to limit futures trading for hedging purposes so that a
portfolio will not enter into futures contracts or related options if the
aggregate initial margins and premiums exceed 5% of the fair market value of its
assets, after taking into account unrealized profits and unrealized losses on
any such contracts and options.

In addition, as permitted by applicable regulations, the Conservative Balanced
and Flexible Managed Portfolios may purchase and sell stock index futures
contracts and interest rate futures contracts to adjust the portfolio's asset
mix. For example, if the investment manager expects bonds to outperform stocks,
it may purchase interest rate futures contracts rather than actually selling
stocks and buying bonds. Neither portfolio will enter into futures contracts or
related options for this purpose if the aggregate initial margins and premiums
for futures and options for this purpose exceed 5% of the fair market of that
portfolio's assets, taking into account unrealized profits and unrealized losses
on any such futures and options.

A portfolio's successful use of futures contracts depends upon the investment
manager's ability to predict the direction of the relevant market. The
correlation between movement in the price of the futures contract and the price
of the securities or currencies being hedged is imperfect. The ability of a
portfolio to close out a futures position depends on a liquid secondary market.
There is no assurance that liquid secondary markets will exist for any
particular futures contract at any particular time.

OPTIONS ON FUTURES CONTRACTS

To the extent permitted by applicable insurance law and federal regulations, the
Conservative Balanced, Flexible Managed, Stock Index, Equity Income, Equity,
Prudential Jennison, Small Capitalization Stock, Global and Natural Resources,
Portfolios may enter into certain transactions involving options on stock index
futures contracts; the Diversified Bond, Government Income, Conservative
Balanced, Flexible Managed High Yield Bond and Global Portfolios may enter into
certain transactions involving options on interest rate futures contracts; and
the Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Global and Natural Resources Portfolios may enter into certain
transactions involving options on foreign currency futures contracts. An option
on a futures contract gives the purchaser or holder the right, but not the
obligation, to assume a position in a futures contract (a long position if the
option is a call and a short position if the option is a put) at a specified
price at any time during the option exercise period. The writer of the option is
required upon exercise to assume an offsetting futures position (a short
position if the option is a call and long position if the option is a put). Upon
exercise of the option, the assumption of offsetting futures positions by the
writer and holder of the option will be accomplished by delivery of the
accumulated balance in the writer's futures margin account which represents the
amount by which the market price of the futures contract, at exercise, exceeds,
in the case of a call, or is less than, in the case of a put, the exercise price
of the option on the futures contract. As an alternative to exercise, the holder
or writer of an option may terminate a position by selling or purchasing an
option of the same series. There is no guarantee that such closing transactions
can be effected. The Stock Index and Small Capitalization

31 - Series Fund
<PAGE>

Stock Portfolios intend to utilize options on stock index futures contracts by
constructing "put/call" combinations that are economically comparable to a long
stock index futures position, as described in the statement of additional
information. The other portfolios intend to utilize options on futures contracts
for the same purposes that they use the underlying futures contracts.

REPURCHASE AGREEMENTS

The portfolios may enter into repurchase agreements, subject to each portfolio's
investment limit in short-term debt obligations, whereby the seller of a
security agrees to repurchase that security from the portfolio at a mutually
agreed-upon time and price. The period of maturity is usually quite short,
possibly overnight or a few days, although it may extend over a number of
months. The resale price is in excess of the purchase price, reflecting an
agreed-upon rate of return effective for the period of time the portfolio's
money is invested in the repurchase agreement. The repurchase agreements will at
all times be fully collateralized in an amount at least equal to the resale
price. The instruments held as collateral are valued daily, and if the value of
the instruments declines, the portfolio will require additional collateral. If
the seller defaults and the value of the collateral securing the repurchase
agreement declines, the portfolio may incur a loss. All portfolios, except the
Global Portfolio, participate in a joint repurchase account pursuant to an order
of the SEC. On a daily basis, any uninvested cash balances of the portfolios may
be aggregated and invested in one or more repurchase agreements. Each portfolio
participates in the income earned or accrued in the joint account based on the
percentage of its investment.

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS

The Diversified Bond, Government Income and High Yield Bond Portfolios, as well
as the fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios, may use reverse repurchase agreements and dollar rolls. The Money
Market Portfolio and the money market portion of any portfolio may use reverse
repurchase agreements. Reverse repurchase agreements involve the sale of
securities held by a portfolio with an agreement by the portfolio to repurchase
the same securities at an agreed upon price and date. During the reverse
repurchase period, the portfolio often continues to receive principal and
interest payments on the sold securities. The terms of each agreement reflect a
rate of interest for use of the funds for the period, and thus these agreements
have the characteristics of borrowing by the portfolio. Dollar rolls involve
sales by a portfolio of securities for delivery in the current month with a
simultaneous contract to repurchase substantially similar securities (same type
and coupon) from the same party at an agreed upon price and date. During the
roll period, the portfolio forgoes principal and interest paid on the
securities. A portfolio is compensated by the difference between the current
sales price and the forward price for the future purchase (often referred to as
the "drop") as well as by the interest earned on the cash proceeds of the
initial sale. A "covered roll" is a specific type of dollar roll for which there
is an offsetting cash position or a cash equivalent security position which
matures on or before the forward settlement date of the dollar roll transaction.
A portfolio will establish a segregated account with its custodian in which it
will maintain cash, U.S. Government securities or other liquid unencumbered
assets equal in value to its obligations in respect of reverse repurchase
agreements and dollar rolls. Reverse repurchase agreements and dollar rolls
involve the risk that the market value of the securities retained by the
portfolio may decline below the price of the securities the portfolio has sold
but is obligated to repurchase under the agreement. In the event the buyer of
securities under a reverse repurchase agreement or dollar roll files for
bankruptcy or becomes insolvent, the portfolio's use of the proceeds of the
agreement may be restricted pending a determination by the other party, or its
trustee or receiver, whether to enforce the portfolio's obligation to repurchase
the securities. The Diversified Bond, Government Income and High Yield Bond
Portfolios, as well as the fixed income portions of the Conservative Balanced
and Flexible Managed Portfolios, will not obligate more than 30% of their net
assets in connection with reverse repurchase agreements and dollar rolls. No
other portfolio will obligate more than 10% of its net assets in connection with
reverse repurchase agreements.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES

From time to time, in the ordinary course of business, the Diversified Bond,
Government Income, Conservative Balanced, Flexible Managed, High Yield Bond,
Equity Income, Equity, Prudential Jennison, Small Capitalization Stock, Global
and Natural Resources Portfolios may purchase or sell securities on a
when-issued or delayed delivery basis, that is, delivery and payment can take
place a month or more after the date of the transaction. A portfolio will make
commitments for such when-issued transactions only with the intention of
actually acquiring the securities. A portfolio's custodian will maintain, in a
separate account, cash, U.S. Government securities or other liquid unencumbered
assets having a value equal to or greater than such commitments. If a portfolio
chooses to dispose of the right to acquire a when-issued security prior to its
acquisition, it could, as with the disposition of any other portfolio security,
incur a gain or loss due to market fluctuations.

In addition, the Money Market Portfolio and short-term portions of the other
portfolios may purchase money market securities on when-issued or delayed
delivery basis on the terms set forth in the Appendix to this prospectus.

32 - Series Fund
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SHORT SALES

The Diversified Bond, Government Income, Conservative Balanced, Flexible Managed
and High Yield Bond Portfolios may sell securities they do not own in
anticipation of a decline in the market value of those securities ("short
sales"). To complete such a transaction, the portfolio will borrow the security
to make delivery to the buyer. The portfolio is then obligated to replace the
security borrowed by purchasing it at the market price at the time of
replacement. The price at such time may be more or less than the price at which
the security was sold by the portfolio. Until the security is replaced, the
portfolio is required to pay to the lender any interest which accrues during the
period of the loan. To borrow the security the portfolio may be required to pay
a premium which would increase the cost of the security sold. The proceeds of
the short sale will be retained by the broker to the extent necessary to meet
margin requirements until the short position is closed out. Until the portfolio
replaces the borrowed security, it will (a) maintain in a segregated account
cash, U.S. Government securities or other liquid unencumbered assets at such a
level that the amount deposited in the account plus the amount deposited with
the broker as collateral will equal the current market value of the security
sold short and will not be less than the market value of the security at the
time it was sold short or (b) otherwise cover its short position.

The portfolio will incur a loss as a result of the short sale if the price of
the security increases between the date of the short sale and the date on which
the portfolio replaces the borrowed security. The portfolio will realize a gain
if the security declines in price between those dates. This result is the
opposite of what one would expect from a cash purchase of a long position in a
security. The amount of any gain will be decreased, and the amount of any loss
will be increased, by the amount of any premium or interest paid in connection
with the short sale. No more than 25% of any portfolio's net assets will be,
when added together: (i) deposited as collateral for the obligation to replace
securities borrowed to effect short sales and (ii) allocated to segregated
accounts in connection with short sales.

SHORT SALES AGAINST THE BOX

All portfolios (other than the Money Market and Zero Coupon Bond Portfolios) may
make short sales of securities or maintain a short position, provided that at
all times when a short position is open the portfolio owns an equal amount of
such securities or securities convertible into or exchangeable, with or without
payment of any further consideration, for an equal amount of the securities of
the same issuer as the securities sold short (a "short sale against the box");
provided, that if further consideration is required in connection with the
conversion or exchange, cash, U.S. Government securities or other liquid
unencumbered assets in an amount equal to such consideration must be put in a
segregated account.

INTEREST RATE SWAPS

The Diversified Bond, Government Income and High Yield Bond Portfolios and the
fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may use interest rate swaps to increase or decrease a portfolio's
exposure to long- or short-term interest rates. No portfolio currently intends
to invest more than 5% of its net assets at any one time in interest rate swaps.
For more information, see the statement of additional information.

LOANS OF PORTFOLIO SECURITIES

All of the portfolios except the Money Market Portfolio may from time to time
lend the securities they hold to broker-dealers, provided that such loans are
made pursuant to written agreements and are continuously secured by collateral
in the form of cash, U.S. Government securities or irrevocable standby letters
of credit in an amount equal to at least the market value at all times of the
loaned securities plus the accrued interest and dividends. During the time
securities are on loan, the portfolio will continue to receive the interest and
dividends or amounts equivalent thereto, on the loaned securities while
receiving a fee from the borrower or earning interest on the investment of the
cash collateral. The right to terminate the loan will be given to either party
subject to appropriate notice. Upon termination of the loan, the borrower will
return to the lender securities identical to the loaned securities. The
portfolio will not have the right to vote securities on loan, but would
terminate the loan and retain the right to vote if that were considered
important with respect to the investment.

The primary risk in lending securities is that the borrower may become insolvent
on a day on which the loaned security is rapidly advancing in price. In such
event, if the borrower fails to return the loaned securities, the existing
collateral might be insufficient to purchase back the full amount of the
security loaned, and the borrower would be unable to furnish additional
collateral. The borrower would be liable for any shortage; but the portfolio
would be an unsecured creditor with respect to such shortage and might not be
able to recover all or any of it. However, this risk may be minimized by a
careful selection of borrowers and securities to be lent and by monitoring
collateral.

33 - Series Fund
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No portfolio will lend securities to broker-dealers affiliated with Prudential,
including Prudential Securities Incorporated. This will not affect a portfolio's
ability to maximize its securities lending opportunities.

INVESTMENT RESTRICTIONS APPLICABLE
TO THE PORTFOLIOS

The Series Fund is subject to certain investment restrictions which are
fundamental to the operations of the Series Fund and may not be changed except
with the approval of a majority vote (as defined under INVESTMENT OBJECTIVES AND
POLICIES OF THE PORTFOLIOS on page 10) of the persons participating in the
affected portfolio.

The investments of the various portfolios are generally subject to certain
additional restrictions under state laws. In the event of future amendments to
the applicable statutes, each portfolio will comply, without the approval of the
shareholders, with the statutory requirements as so modified.

For a detailed discussion of investment restrictions applicable to the Series
Fund, see INVESTMENT RESTRICTIONS in the statement of additional information.

INVESTMENT MANAGEMENT ARRANGEMENTS
AND EXPENSES

The Series Fund has entered into an Investment Advisory Agreement with
Prudential under which Prudential will, subject to the direction of the Board of
Directors of the Series Fund, be responsible for the management of the Series
Fund, and provide investment advice and related services to each portfolio. The
directors, in addition to reviewing the actions of the Series Fund's investment
advisor, decide upon matters of general policy. The Series Fund's officers
conduct and supervise the daily business operations of the Series Fund.

Prudential, founded in 1875 under the laws of New Jersey, is subject to
regulation by the Department of Insurance of the State of New Jersey as well as
by the insurance departments of all the other states and jurisdictions in which
it does business. Prudential is registered both as a broker-dealer under the
Securities Exchange Act of 1934 and as an investment advisor under the
Investment Advisers Act of 1940. Prudential's principal business address is
Prudential Plaza, Newark, New Jersey 07102-3777.

Prudential manages the assets that it owns as well as those of various separate
accounts established by Prudential and those held by other investment companies
for which it acts as investment advisor. Total assets under management as of
December 31, 1996 were over $xxx billion which includes over $xxx billion owned
by Prudential and approximately $xx billion of external assets under
Prudential's management.

Subject to Prudential's supervision, substantially all of the investment
advisory services provided to the Series Fund by Prudential are furnished, with
respect to fourteen of the Series Fund's fifteen portfolios, by its wholly-owned
subsidiary PIC, pursuant to the Service Agreement between Prudential and PIC.
The Agreement provides that a portion of the fee received by Prudential for
providing investment advisory services will be paid to PIC. Investment advisory
services with respect to the Prudential Jennison Portfolio provided by
Prudential are furnished by another wholly-owned subsidiary, Jennison Associates
Capital Corp. ("Jennison"), pursuant to an Investment Subadvisory Agreement
between Prudential and Jennison. That Agreement provides that a portion of the
fee received by Prudential for providing investment advisory services to the
Prudential Jennison Portfolio will be paid to Jennison. PIC and Jennison are
both registered as investment advisors under the Investment Advisers Act of
1940.

Under the Investment Advisory Agreement, Prudential receives an investment
management fee as compensation for its services to the Series Fund. The fee is a
daily charge, payable quarterly, equal to an annual percentage of the average
daily net assets of each individual portfolio.

The investment management fee for the Stock Index Portfolio is equal to an
annual rate of 0.35% of the average daily net assets of the portfolio. For the
Money Market, Diversified Bond, Government Income, Equity Income, Zero Coupon
Bond, and Small Capitalization Stock Portfolios that fee is equal to an annual
rate of 0.4% of the average daily net assets of each of the portfolios. For the
Equity and Natural Resources Portfolios, the fee is equal to an annual rate of
0.45% of the average daily net assets of each of the portfolios. The fee for the
Conservative Balanced and the High Yield Bond Portfolios is equal to an annual
rate of 0.55% of the average daily net assets of each of the portfolios. For the
Flexible Managed and Prudential Jennison Portfolios, the fee is equal to an
annual rate of 0.6% of the average daily net assets of the portfolio. The fee
for the Global Portfolio is equal to an annual rate of 0.75% of the average
daily net assets of the portfolio.

For the year ended December 31, 1996, the Series Fund's total expenses were
0.xx% of the average net assets of the Series Fund's portfolios. The investment
management fee for that period constituted 0.xx% of the average net assets. For
further information about the expenses of the Series Fund, see INVESTMENT
MANAGEMENT ARRANGEMENTS AND EXPENSES in the statement of additional information.

34 - Series Fund
<PAGE>

PURCHASE AND REDEMPTION OF SHARES

Shares in the Series Fund are currently offered continuously, without sales
charge, at prices equal to the respective net asset values of the portfolios,
only to the Accounts to fund benefits payable under the Contracts. The Series
Fund may at some later date also offer its shares to other separate accounts of
Prudential or other insurers. Pruco Securities Corporation ("Prusec"), an
indirect wholly-owned subsidiary of Prudential, acts as the principal
underwriter of the Series Fund. Prusec's principal business address is 213
Washington Street, Newark, New Jersey 07102-2992.

The Series Fund is required to redeem all full and fractional shares of the
Series Fund for cash within 7 days of receipt of proper notice of redemption.
The redemption price is the net asset value per share next determined after the
initial receipt of proper notice of redemption.

The right to redeem shares or to receive payment with respect to any redemption
may be suspended only for any period during which trading on the NYSE is
restricted as determined by the Securities and Exchange Commission or when such
exchange is closed (other than customary weekend and holiday closings), for any
period during which an emergency exists as defined by the Securities and
Exchange Commission as a result of which disposal of a portfolio's securities or
determination of the net asset value of each portfolio is not reasonably
practicable, and for such other periods as the Securities and Exchange
Commission may by order permit for the protection of shareholders of each
portfolio.

DETERMINATION OF NET ASSET VALUE

The net asset value of the shares of each portfolio is determined once daily, as
of 4:15 p.m. New York City time (12:00 noon New York City time in the case of
the Money Market Portfolio) on each day during which the NYSE is open for
business. The NYSE is open for business Monday through Friday except for the
days on which the following holidays are observed: New Year's Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
and Christmas Day. In the event the New York Stock Exchange closes early on any
business day, the net asset value of each portfolio shall be determined at a
time between such closing and 4:15 p.m. New York City time. The net asset value
per share of each portfolio except the Money Market Portfolio is computed by
adding the sum of the value of the securities held by that portfolio plus any
cash or other assets it holds, subtracting all its liabilities, and dividing the
result by the total number of shares outstanding of that portfolio at such time.
Expenses, including the investment management fee payable to Prudential, are
accrued daily.

In determining the net asset value of the Diversified Bond, Government Income
and High Yield Bond Portfolios, securities (other than debt obligations with
remaining maturities of less than 60 days, which are valued at amortized cost)
will be valued utilizing an independent pricing service to determine valuations
for normal institutional size trading units of securities. The pricing service
considers such factors as security prices, yields, maturities, call features,
ratings, and developments relating to specific securities in arriving at
securities valuations.

The net asset value of shares of the Money Market Portfolio will normally remain
at $10 per share, because the net investment income of this portfolio (including
realized and unrealized gains and losses on portfolio holdings) will be declared
as a dividend each time the portfolio's net income is determined, see DIVIDENDS,
DISTRIBUTIONS, AND TAXES, page 36. If in the view of the Board of Directors of
the Series Fund it is inadvisable to continue to maintain the net asset value of
the Money Market Portfolio at $10 per share, the Board reserves the right to
alter the procedure. The Series Fund will notify shareholders of any such
alteration.

All short-term debt obligations in the Money Market Portfolio of 397 days'
maturity or less are valued on an amortized cost basis. This means that each
obligation will be valued initially at its purchase price and thereafter by
amortizing any discount or premium uniformly to maturity, regardless of the
impact of fluctuating interest rates on the market value of the obligation. This
highly practical method of valuation is in widespread use and almost always
results in a value that is extremely close to the actual market value. In order
to continue to utilize the amortized cost method of valuation, the Money Market
Portfolio may not purchase any security with a remaining maturity of more than
397 days and must maintain a dollar-weighted average of portfolio maturity of 90
days or less. In the event of sizeable changes in interest rates, however, the
value determined by this method may be higher or lower than the price that would
be received if the obligation were sold. The Board of Directors has established
procedures to determine whether, on these occasions, if any should occur, the
deviation might be enough to affect the value of shares in the portfolio by more
than 1/2 of one percent, and, if it does, an appropriate adjustment will be made
in the value of the obligations. The portfolio may only be invested in
securities of high quality as described in detail in the Appendix to this
prospectus.

The net asset value of the Stock Index, Equity Income, Equity, Prudential
Jennison, Small Capitalization Stock, Global and Natural Resources Portfolios
will be determined in the following manner. Any security for which the primary
market is on an exchange is generally valued at the last sale price on such
exchange as of the close of the

35 - Series Fund
<PAGE>

NYSE (which is currently 4:00 p.m. New York City time) or, in the absence of
recorded sales, at the mean between the most recently quoted bid and asked
prices. NASDAQ National Market System equity securities are valued at the last
sale price or, if there was no sale on such day, at the mean between the most
recently quoted bid and asked prices. Other over-the-counter equity securities
are valued at the mean between the most recently quoted bid and asked prices.
Convertible debt securities that are actively traded in the over-the-counter
market, including listed securities for which the primary market is believed to
be over-the-counter, are valued at the mean between the most recently quoted bid
and asked prices. Corporate bonds (other than convertible debt securities) and
Government bonds held by the Equity Income and Natural Resources Portfolios are
valued on the same basis as securities in the Diversified Bond and High Yield
Bond Portfolios, as described above. Short-term debt instruments which mature in
less than 60 days are valued at amortized cost. For valuation purposes,
quotations of foreign securities in a foreign currency are converted to U.S.
dollar equivalents.

Generally, trading in foreign securities, as well as corporate bonds, U.S.
Government securities, and money market instruments, is substantially completed
each day at various times prior to the close of the NYSE. The value of any such
securities is determined as of such times for purposes of computing a
portfolio's net asset value. Foreign currency exchange rates are also generally
determined prior to the close of the NYSE. If an extraordinary event occurs
after the close of an exchange on which that security is traded, the security
will be valued at fair value as determined in good faith by the applicable
portfolio manager under procedures established by and under the general
supervision of the Series Fund's Board of Directors.

In determining the net asset value of each of the Balanced Portfolios, the
method of valuation of a security depends on the type of investment involved.
Intermediate or long-term fixed income securities are valued in the same way as
such securities in the Diversified Bond Portfolio, and common stocks and
convertible debt securities are valued in the same way as such securities are
valued in the Equity Portfolio. Short-term debt obligations with a maturity of
12 months or less are valued on an amortized cost basis in accordance with an
order obtained from the Securities and Exchange Commission. Each Balanced
Portfolio must maintain a dollar-weighted average maturity for its short-term
debt obligations of 120 days or less. As discussed above in connection with the
Money Market Portfolio, the values determined by the amortized cost method may
deviate from market value under certain circumstances. The Board of Directors
has established procedures to monitor whether any material deviation occurs and,
if so, will promptly consider what action, if any, should be initiated to
prevent unfair results to Contract owners. The short-term portion of these
portfolios may be invested only in high quality instruments, as described in the
Appendix to this prospectus.

In determining the net asset value of shares of Zero Coupon Bond Portfolios 2000
and 2005, securities (other than debt obligations with maturities of less than
60 days, which are valued at amortized cost) will be valued utilizing an
independent pricing service to determine valuations for normal institutional
size trading units of securities. The pricing service considers such factors as
security prices, yields, maturities, call features, ratings, and developments
relating to specific securities in arriving at securities valuations.

With respect to all the portfolios which utilize such investments, options on
stock and stock indices traded on national securities exchanges are valued at
the average of the bid and asked prices as of the close of the respective
exchange (which is currently 4:10 p.m. New York City time). Futures contracts
and options thereon are valued at the last sale price at the close of the
applicable commodities exchanges or board of trade (which is currently 4:15 p.m.
New York City time) or, if there was no sale on the applicable commodities
exchange or board of trade on such day, at the mean between the most recently
quoted bid and asked prices on such exchange or board of trade.

Securities or assets for which market quotations are not readily available will
be valued at fair value as determined by Prudential under the direction of the
Board of Directors of the Series Fund.

At the beginning of each week, after the net asset value of each Zero Coupon
Bond Portfolio has been determined, Prudential will calculate the compounded
annual yield that would result if all securities in the portfolio were held
until the liquidation date or until their maturity dates, if earlier (with the
proceeds reinvested until the liquidation date). This is the predicted yield for
that date. It can also be expressed as the amount to which a premium payment of
$10,000 is predicted to grow by the portfolio's liquidation date. Prudential
will furnish both of these numbers on request. Unless there is a significant
change in the general level of interest rates--in which case a recalculation
will be made--the predicted yield is not likely to vary materially over the
course of each week.

DIVIDENDS, DISTRIBUTIONS, AND TAXES

The Series Fund intends to continue to qualify as a regulated investment company
under certain provisions of the Internal Revenue Code (the "Code"). Under such
provisions, the Series Fund will not be subject to federal income tax on the
part of its net ordinary income and net realized capital gains that it
distributes to the Accounts. The Series Fund intends to meet the requirements
for treatment as a regulated investment company both on a portfolio-by-portfolio
basis and for the Series Fund as a whole. The Series Fund's compliance with
those

36 - Series Fund
<PAGE>

requirements may prevent a portfolio from utilizing options and futures
contracts as much as the portfolio manager might otherwise believe to be
desirable.

The Series Fund intends to distribute as dividends substantially all the net
investment income, if any, of each portfolio. For dividend purposes, net
investment income of each portfolio, other than the Money Market Portfolio and
the Zero Coupon Bond Portfolios, will consist of all payments of dividends
(other than stock dividends) or interest received by such portfolio less the
estimated expenses of such portfolio (including fees payable to the Investment
Manager). Net investment income of the Money Market Portfolio consists of: (i)
interest accrued and/or discount earned (including both original issue and
market discount); (ii) plus or minus all realized and unrealized gains and
losses; (iii) less the expenses of the portfolio (including the fees payable to
the Investment Manager). The Internal Revenue Service has ruled that the owner
of a zero coupon bond, for federal income tax purposes, realizes taxable
interest each year equal to a portion of the difference between the face value
of the zero coupon bond and its purchase price. For dividend purposes, the net
investment income of each Zero Coupon Bond Portfolio will be equal to the sum of
such taxable interest realized by such portfolio and the interest upon the
interest-bearing securities less the estimated expenses of the portfolio.
Therefore, each portfolio may be required to distribute more cash than it
actually has received. Each portfolio will raise the cash necessary to make such
distributions by selling securities or from interest income. This may require
the portfolio to sell securities when it would not do so for investment reasons,
and may cause the portfolio to realize additional gains. The Contract owner is
not subject to federal or state income taxes on distributions from the Series
Fund portfolios to the corresponding subaccounts.

Dividends on the Money Market Portfolio will be declared and reinvested daily in
additional full and fractional shares of the portfolio. Shares will begin
accruing dividends on the day following the date on which they are issued.
Dividends from investment income of the other portfolios will normally be
declared and reinvested in additional full and fractional shares
quarter-annually.

The Series Fund will also declare and distribute annually all net realized
capital gains of the Series Fund, other than short-term gains of the Money
Market Portfolio, which are declared as dividends daily.

The Code generally imposes a 4% excise tax on a portion of the undistributed
income of a regulated investment company if that company fails to distribute
required percentages of its ordinary income and capital gain net income. The
Series Fund intends to employ practices that will eliminate or minimize the
imposition of this excise tax.

In addition, Section 817(h) of the Code requires that assets underlying variable
life insurance and variable annuity contracts must meet certain diversification
requirements if the contracts are to qualify as life insurance and annuity
contracts. The diversification requirements ordinarily must be met within 1 year
after Contract owner funds are first allocated to the particular portfolio, and
within 30 days after the end of each calendar quarter thereafter. In order to
meet the diversification requirements set forth in Treasury Regulations issued
pursuant to Section 817(h), each portfolio must meet one of two alternative
tests. Under the first test, no more than 55% of the portfolio's assets can be
invested in any one investment; no more than 70% of the assets can be invested
in any two investments; no more than 80% of the assets can be invested in any
three investments; and no more than 90% can be invested in any four investments.
Under the second test, the portfolio must meet the tax law diversification
requirements for a regulated investment company and no more than 55% of the
value of the portfolio's assets can be invested in cash, cash items, Government
securities, and securities of other regulated investment companies. A third test
is available for portfolios that underlie only variable life insurance
contracts, such as the Zero Coupon Bond Portfolios. Under this test, such
portfolios can be invested without limit in Treasury securities and, where the
portfolio is invested in part in Treasury securities, the percentages of the
first test are revised and applied to the portion of the portfolio not invested
in Treasury securities.

For purposes of determining whether a variable account is adequately
diversified, each United States Government agency or instrumentality is treated
as a separate issuer for purposes of determining whether a variable account is
adequately diversified. The Series Fund's compliance with the diversification
requirements will generally limit the amount of assets that may be invested in
federally insured certificates of deposit and all types of securities issued or
guaranteed by each United States Government agency or instrumentality.

The Global Portfolio may be required to pay withholding or other taxes to
foreign governments. If so, the taxes will reduce the portfolio's dividends.
Foreign tax withholding from dividends and interest (if any) is typically set at
a rate between 10% and 15%. While Contract owners will thus bear the cost of
foreign tax withholding, they will not be able to claim a foreign tax credit or
deduction for foreign taxes paid by the portfolio.

The foregoing is a general and abbreviated summary of the applicable provisions
of the Code and Treasury Regulations currently in effect. For the complete
provisions, reference should be made to the pertinent Code sections and the
Treasury Regulations promulgated thereunder. The Code and these Regulations are
subject to change by legislative or administrative actions.

37 - Series Fund
<PAGE>

OTHER INFORMATION CONCERNING THE SERIES FUND

INCORPORATION AND AUTHORIZED STOCK

The Series Fund was incorporated under Maryland law on November 15, 1982. The
authorized Capital Stock of the Series Fund consists of 2 billion shares, par
value $0.01 per share. The shares of Capital Stock are divided into fifteen
classes: Money Market Portfolio Capital Stock (225 million shares), Diversified
Bond Portfolio Capital Stock (200 million shares), Government Income Portfolio
Capital Stock (100 million shares), Zero Coupon Bond Portfolio 2000 Capital
Stock (25 million shares), Zero Coupon Bond Portfolio 2005 Capital Stock (50
million shares), Conservative Balanced Portfolio Capital Stock (300 million
shares), Flexible Managed Portfolio Capital Stock (300 million shares), High
Yield Bond Portfolio Capital Stock (100 million shares), Stock Index Portfolio
Capital Stock (100 million shares), Equity Income Portfolio Capital Stock (100
million shares), Common Stock Portfolio Capital Stock (200 million shares),
Prudential Jennison Portfolio Capital Stock (50 million shares), Small
Capitalization Stock Portfolio Capital Stock (50 million shares), Global
Portfolio Capital Stock (100 million shares), Natural Resources Portfolio
Capital Stock (100 million shares). The shares of each portfolio, when issued,
will be fully paid and non-assessable, will have no conversion, exchange or
similar rights, and will be freely transferable.

Each share of stock will have a pro rata interest in the assets of the portfolio
to which the stock of that class relates and will have no interest in the assets
of any other portfolio. Holders of shares of any portfolio are entitled to
redeem their shares as set forth under PURCHASE AND REDEMPTION OF SHARES, page
35.

From time to time, Prudential has purchased Series Fund shares to provide
initial capital for the Series Fund and to enable portfolios to avoid
unrealistically poor investment performance that might otherwise result because
the amounts available for investment were too small. Prudential will not redeem
any of its shares until a portfolio is large enough so that redemption will not
have an adverse effect upon investment performance. As of December 31, 1996,
Prudential held $xxx,xxx worth of shares in the Prudential Jennison Portfolio,
$xxx,xxx,xxx worth of shares in the Small Capitalization Stock Portfolio, and
$xxx,xxx,xxx worth of shares in the Global Portfolio. Prudential will vote its
shares in the same manner and in the same proportion as the shares held in the
Accounts, which generally are voted in accordance with instructions of Contract
owners.

VOTING RIGHTS

The voting rights of Contract owners, and limitations on those rights, are
explained in the accompanying prospectus for the Contracts. Prudential and
certain other insurers with separate accounts which invest in the Series Fund,
as the owners of the assets in the Accounts, vote all of the shares of the
Series Fund, but they will generally do so in accordance with the instructions
of Contract owners pursuant to the current SEC requirements and staff
interpretations regarding pass-through voting. Under certain circumstances,
however, the Companies may disregard voting instructions received from Contract
owners. The Series Fund does not hold annual meetings of shareholders in any
year in which it is not required to do so either under Maryland law or the
Investment Company Act of 1940. For additional information describing how the
Companies will vote the shares of the Series Fund, see Voting Rights in the
accompanying prospectus for the Contracts.

MONITORING FOR POSSIBLE CONFLICT

As stated above, Series Fund shares will be sold to separate accounts of
Prudential and certain other insurers to fund both variable life insurance and
variable annuity contracts. The Board of Directors of the Series Fund intends to
monitor events for the existence of any material conflict between the interests
of variable life insurance and variable annuity contract owners. The Companies
have agreed to be responsible for reporting any potential or existing conflicts
to the Board of Directors. Moreover, the Companies have agreed to be
responsible, at their cost, to remedy any material irreconcilable conflict up to
and including establishing a new registered management investment company and
segregating the assets underlying the variable life insurance and variable
annuity contracts.

PERIODIC REPORTS

The Series Fund will send each shareholder, at least annually, statements
showing as of a specified date the number of shares in each portfolio credited
to the shareholder. The Series Fund will also send Contract owners annual and
semi-annual reports showing the financial condition of the portfolios and the
investments held in each. The annual report may take the form of an updated copy
of this prospectus and its accompanying statement of additional information.

PORTFOLIO BROKERAGE AND RELATED PRACTICES

38 - Series Fund
<PAGE>

exchange in equity securities will be executed primarily through brokers that
will receive a commission paid by the portfolio. The Money Market, Diversified
Bond, High Yield Bond, Government Income, and Zero Coupon Bond Portfolios, on
the other hand, will not normally incur any brokerage commissions. Fixed income
securities, as well as equity securities traded in the over-the-counter market,
are generally traded on a "net" basis with dealers acting as principals for
their own accounts without a stated commission, although the price of the
security usually includes a profit to the dealer. In underwritten offerings,
securities are purchased at a fixed price that includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. Certain of these securities may also be purchased
directly from an issuer, in which case neither commissions nor discounts are
paid.

An affiliated broker may be employed to execute brokerage transactions on behalf
of the portfolios, as long as the commissions are reasonable and fair compared
to the commissions received by other brokers in connection with comparable
transactions involving similar securities being purchased or sold on a
securities exchange during a comparable period of time. The Series Fund may not
engage in any transactions in which Prudential or its affiliates, including
Prudential Securities Incorporated, acts as principal, including
over-the-counter purchases and negotiated trades in which such a party acts as a
principal. Additional information about portfolio brokerage and related
transactions is included in the statement of additional information.

CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT

Chase Manhattan Bank ("Chase"), Chase Metro Tech Center, Brooklyn, NY 11245 is
the custodian of the assets held by all the portfolios, except the Global
Portfolio. Chase is also the custodian of the assets held in connection with
repurchase agreements entered into by the portfolios, and is authorized to use
the facilities of the Depository Trust Company and the facilities of the
book-entry system of the Federal Reserve Bank with respect to securities held by
these portfolios. Brown Brothers Harriman & Co. ("Brown Brothers"), 40 Water
Street, Boston, MA 02109, is the custodian of the assets of the Global
Portfolio. Chase and Brown Brothers employ subcustodians, who were approved by
the directors of the Series Fund in accordance with regulations of the
Securities and Exchange Commission, for the purpose of providing custodial
service for the Series Fund's foreign assets held outside the United States. The
directors of the Series Fund monitor the activities of the custodians and the
subcustodians.

Prudential is the transfer agent and dividend disbursing agent for the Series
Fund. Prudential as transfer agent issues and redeems shares of the Series Fund
and maintains records of ownership for the shareholders. Prudential's principal
business address is Prudential Plaza, Newark, New Jersey 07102-3777.

ADDITIONAL INFORMATION

This prospectus and the statement of additional Information referred to on the
cover page do not contain all the information set forth in the registration
statement, certain portions of which have been omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. The omitted information
may be obtained from the Commission's principal office in Washington, D.C., upon
payment of the fees prescribed by the Commission.

For further information, shareholders may also contact the Series Fund's office,
the address and phone number of which are set forth on the cover of this
prospectus.

39 - Series Fund
<PAGE>

APPENDIX

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST

The Money Market Portfolio, and the other portfolios to the extent their
investment policies so provide, may invest in the following liquid, short-term,
debt securities regularly bought and sold by financial institutions:

1. U.S. Treasury Bills and other obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. These are debt securities
(including bills, certificates of indebtedness, notes, and bonds) issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of the U.S.
Government that is established under the authority of an act of Congress.
Although all obligations of agencies and instrumentalities are not direct
obligations of the U.S. Treasury, payment of the interest and principal on them
is generally backed directly or indirectly by the U.S. Government. This support
can range from the backing of the full faith and credit of the United States, to
U.S. Treasury guarantees or to the backing solely of the issuing instrumentality
itself. Securities which are not backed by the full faith and credit of the
United States include but are not limited to obligations of the Tennessee Valley
Authority, the Federal National Mortgage Association, the Federal Home Loan
Mortgage Corporation, and the United States Postal Service, each of which has
the right to borrow from the U.S. Treasury to meet its obligations, and
obligations of the Federal Farm Credit System and the Federal Home Loan Banks,
the obligations of which may only be satisfied by the individual credit of the
issuing agency. Obligations of the Government National Mortgage Association, the
Farmers Home Administration, and the Export-Import Bank are examples of
securities that are backed by the full faith and credit of the United States.

2. Obligations (including certificates of deposit, bankers' acceptances, and
time deposits) of domestic banks, foreign branches of U.S. banks, U.S. branches
of foreign banks, and foreign offices of foreign banks provided that such bank
has, at the time of the portfolio's investment, total assets of at least $1
billion or the equivalent. Obligations of any savings and loan association or
savings bank organized under the laws of the United States or any state thereof,
provided that such association or savings bank has, at the time of the
portfolio's investment, total assets of at least $1 billion. The term
"certificates of deposit" includes both Eurodollar certificates of deposit,
which are traded in the over-the-counter market, and Eurodollar time deposits,
for which there is generally not a market. "Eurodollars" are dollars deposited
in banks outside the United States. An investment in Eurodollar instruments
involves risks that are different in some respects from an investment in debt
obligations of domestic issuers, including future political and economic
developments such as possible expropriation or confiscatory taxation that might
adversely affect the payment of principal and interest on the Eurodollar
instruments.

"Certificates of deposit" are certificates evidencing the indebtedness of a
commercial bank to repay funds deposited with it for a definite period of time
(usually from 14 days to 1 year). "Bankers' acceptances" are credit instruments
evidencing the obligation of a bank to pay a draft which has been drawn on it by
a customer. These instruments reflect the obligation both of the bank and of the
drawer to pay the face amount of the instrument upon maturity. "Time deposits"
are non-negotiable deposits in a bank for a fixed period of time.

3. Commercial paper, variable amount demand master notes, bills, notes, and
other obligations issued by a U.S. company, a foreign company or a foreign
government, its agencies, instrumentalities or political subdivisions,
denominated in U.S. dollars, and, at the date of investment, rated at least A or
A-2 by Standard & Poor's Rating Group ("S&P"), A or Prime-2 by Moody's Investors
Service ("Moody's") or, if not rated, issued by an entity having an outstanding
unsecured debt issue rated at least A or A-2 by S&P or A or Prime-2 by Moody's.
A description of corporate bond ratings is contained in the Appendix to the
statement of additional information. If such obligations are guaranteed or
supported by a letter of credit issued by a bank, such bank (including a foreign
bank) must meet the requirements set forth in paragraph 2 above. If such
obligations are guaranteed or insured by an insurance company or other non-bank
entity, such insurance company or other non-bank entity must represent a credit
of high quality, as determined by the Series Fund's investment advisor under the
supervision of the Series Fund's Board of Directors.

As stated above in paragraphs 2 and 3, the Money Market Portfolio and short-term
portions of the other portfolios may contain obligations of foreign branches of
domestic banks and domestic branches of foreign banks, as well as commercial
paper, bills, notes, and other obligations issued in the United States by
foreign issuers, including foreign governments, their agencies, and
instrumentalities. This involves certain additional risks. These risks include
future political and economic developments in the country of the issuer, the
possible imposition of withholding taxes on interest income payable on such
obligations held by the Series Fund, the possible seizure or nationalization of
foreign deposits, and the possible establishment of exchange controls or other
foreign governmental laws or restrictions which might affect adversely the
payment of principal and interest on such obligations held by the Series Fund.
In addition, there may be less publicly available information about a foreign
issuer than about a domestic one, and foreign issuers may not be subject to the
same accounting, auditing and financial recordkeeping standards, and
requirements as domestic issuers. Securities issued by foreign issuers may

A1 - Series Fund
<PAGE>

be subject to greater fluctuations in price than securities issued by U.S.
entities. Finally, in the event of a default with respect to any such foreign
debt obligations, it may be more difficult for the Series Fund to obtain or to
enforce a judgment against the issuers of such securities.

4. Repurchase Agreements. When the Money Market Portfolio purchases money market
securities of the types described above, it may on occasion enter into a
repurchase agreement with the seller wherein the seller and the buyer agree at
the time of sale to a repurchase of the security at a mutually agreed upon time
and price. The period of maturity is usually quite short, possibly overnight or
a few days, although it may extend over a number of months. The resale price is
in excess of the purchase price, reflecting an agreed-upon market rate effective
for the period of time the portfolio's money is invested in the security, and is
not related to the coupon rate of the purchased security. Repurchase agreements
may be considered loans of money to the seller of the underlying security, which
are collateralized by the securities underlying the repurchase agreement. The
Series Fund will not enter into repurchase agreements unless the agreement is
"fully collateralized" (i.e., the value of the securities is, and during the
entire term of the agreement remains, at least equal to the amount of the "loan"
including accrued interest). The Series Fund will take possession of the
securities underlying the agreement and will value them daily to assure that
this condition is met. The Series Fund has adopted standards for the parties
with whom it will enter into repurchase agreements which it believes are
reasonably designed to assure that such a party presents no serious risk of
becoming involved in bankruptcy proceedings within the time frame contemplated
by the repurchase agreement. In the event that a seller defaults on a repurchase
agreement, the Series Fund may incur a loss in the market value of the
collateral, as well as disposition costs; and, if a party with whom the Series
Fund had entered into a repurchase agreement becomes involved in bankruptcy
proceedings, the Series Fund's ability to realize on the collateral may be
limited or delayed and a loss may be incurred if the collateral securing the
repurchase agreement declines in value during the bankruptcy proceedings.

The Series Fund will not enter into repurchase agreements with Prudential or its
affiliates, including Prudential Securities Incorporated. This will not affect
the Series Fund's ability to maximize its opportunities to engage in repurchase
agreements.

5. Reverse Repurchase Agreements. The Money Market Portfolio may use reverse
repurchase agreements, which are described on page 32 of the prospectus. No
portfolio may obligate more than 10% of its net assets in connection with
reverse repurchase agreements, except that the Diversified Bond, High Yield
Bond, and Government Income Portfolios, as well as the fixed income portions of
the Conservative Balanced and Flexible Managed Portfolios, may obligate up to
30% of their net assets in connection with reverse repurchase agreements and
dollar rolls.

6. When-Issued and Delayed Delivery Securities. From time to time, in the
ordinary course of business, the Money Market Portfolio may purchase securities
on a when-issued or delayed delivery basis (i.e., delivery and payment can take
place a month or more after the date of the transaction). The purchase price and
the interest rate payable on the securities are fixed on the transaction date.
The securities so purchased are subject to market fluctuation, and no interest
accrues to the portfolio until delivery and payment take place. At the time the
portfolio makes the commitment to purchase securities on a when-issued or
delayed delivery basis, it will record the transaction and thereafter reflect
the value, each day, of such securities in determining its net asset value. The
portfolio will make commitments for when-issued transactions only with the
intention of actually acquiring the securities and, to facilitate such
acquisitions, the Series Fund's custodian bank will maintain in a separate
account securities of the portfolio having a value equal to or greater than such
commitments. On delivery dates for such transactions, the portfolio will meet
its obligations from maturities or sales of the securities held in the separate
account and/or from then available cash flow. If the portfolio chooses to
dispose of the right to acquire a when issued security prior to its acquisition,
it could, as with the disposition of any other obligation, incur a gain or loss
due to market fluctuation. No when-issued commitments will be made if, as a
result, more than 15% of the portfolio's net assets would be so committed.

The Board of Directors of the Series Fund has adopted policies for the Money
Market Portfolio to conform to amendments of an SEC rule applicable to money
market funds, like the portfolio. These policies do not apply to any other
portfolio. The policies are as follows: (1) The portfolio will not invest more
than 5% of its assets in the securities of any one issuer (except U.S.
Government securities); however, the portfolio may exceed the 5% limit with
respect to a single security rated in the highest rating category for up to
three business days after the purchase thereof; (2) To be eligible for
investment, a security must be a United States dollar-denominated instrument
that the Series Fund's Board has determined to present minimal credit risks and
must be rated in one of the two highest rating categories by at least two
nationally recognized statistical rating organizations ("NRSROs") assigning a
rating to the security or issue, or if only one NRSRO has assigned a rating,
that NRSRO. An unrated security must be deemed to be of comparable quality as
determined by the Series Fund's Board. In other words, the portfolio will invest
in only first tier or second tier securities. First tier securities are
securities which are rated by at least two NRSROs, or by the only NRSRO that has
rated the security, in the highest short-term rating category, or unrated
securities of comparable quality as determined by the Series Fund's Board.

A2 - Series Fund
<PAGE>

Second tier securities are eligible securities that are not first tier
securities; (3) The portfolio will not invest more than 5% of its total assets
in second tier securities; (4) The portfolio may not invest more than 1% of its
assets in second tier securities of any one issuer; (5) In the event a first
tier security held by the portfolio is downgraded and becomes a second tier
security, or in the case of an unrated security the Series Fund's Board
determines it is no longer of comparable quality to a first tier security, or in
the event Prudential becomes aware that a NRSRO has rated a second tier security
or an unrated portfolio security below its second highest rating, the Board will
reassess promptly whether the security presents minimal credit risks and shall
cause the portfolio to take such action as the Board determines is in the best
interests of the portfolio and its shareholders; (6) In the event of a default
or because of a rating downgrade a security held in the portfolio is no longer
an eligible investment, the portfolio will sell the security as soon as
practicable unless the Series Fund's Board makes a specific finding that such
action would not be in the best interest of the portfolio; and (7) The
portfolio's dollar-weighted average maturity will be no more than 90 days. The
Series Fund's Board of Directors has adopted written procedures delegating to
the investment advisor under certain guidelines the responsibility to make
several of the above-described determinations, including certain credit quality
determinations.

A3 - Series Fund

<PAGE>

PROSPECTUS

May 1, 1997

THE PRUDENTIAL

SERIES FUND, INC.

THIS PROSPECTUS IS FOR USE ONLY WITH THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-24, AS IT DESCRIBES ONLY THE PORTFOLIOS AVAILABLE FOR INVESTMENT THROUGH
THAT ACCOUNT. THIS PROSPECTUS SHOULD BE READ IN CONJUNCTION WITH THE CURRENT
PROSPECTUS FOR THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-24.

The Prudential Series Fund, Inc. (the "Series Fund") is a diversified, open-end
management investment company (commonly known as a "mutual fund") that is
intended to provide a range of investment alternatives through its fifteen
separate portfolios, each of which is, for investment purposes, in effect a
separate fund. Seven of the Series Fund's Portfolios are currently available for
investment by Participants in Prudential's MEDLEY(sm) Program through
corresponding subaccounts of The Prudential Variable Contract Account-24. The
Portfolios are: the Diversified Bond Portfolio, the Government Income Portfolio,
the Conservative Balanced Portfolio, the Flexible Managed Portfolio, the Stock
Index Portfolio, the Equity Portfolio, and the Global Portfolio. A separate
class of capital stock is issued for each portfolio. Shares of the Series Fund
are currently sold only to separate accounts (the "Accounts") of The Prudential
Insurance Company of America ("Prudential") and certain other insurers to fund
the benefits under variable life insurance and variable annuity contracts (the
"Contracts") issued by those Companies. The Accounts invest in shares of the
Series Fund through subaccounts that correspond to the portfolios. The Accounts
will redeem shares of the Series Fund to the extent necessary to provide
benefits under the Contracts or for such other purposes as may be consistent
with the Contracts.

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

THE INVESTMENT OBJECTIVES OF THE SEVEN PORTFOLIOS CAN BE FOUND ON THE NEXT PAGE.

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

Information contained in this prospectus should be read carefully by a
prospective investor before an investment is made. Additional information about
the Series Fund has been filed with the Securities and Exchange Commission in a
statement of additional information, dated May 1, 1997, which information is
incorporated herein by reference and is available without charge upon written
request to The Prudential Insurance Company of America, c/o Prudential Defined
Contribution Services, 30 Scranton Office Park, Moosic, Pennsylvania 18507-1789,
or by telephoning 1 (800) 458-6333.

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

PLEASE READ THIS PROSPECTUS AND KEEP IT FOR FUTURE REFERENCE.

THE PRUDENTIAL SERIES FUND, INC.
Prudential Plaza
Newark, New Jersey 07102-3777
Telephone: (800) 445-4571

PSF-1A Ed 5-97

<PAGE>

INVESTMENT OBJECTIVES OF THE PORTFOLIOS ARE AS FOLLOWS:

FIXED INCOME PORTFOLIOS

BALANCED PORTFOLIOS

DIVERSIFIED STOCK PORTFOLIOS

GLOBAL PORTFOLIO. Long-term growth of capital through investment primarily in
common stock and common stock equivalents of foreign and domestic issuers.
Current income, if any, is incidental.

There can be no assurance that the objectives of any portfolio will be realized.
See INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS, page 5. The Series
Fund may in the future establish other portfolios with different investment
objectives.
<PAGE>

CONTENTS

Page

FINANCIAL HIGHLIGHTS...........................................................1

THE SERIES FUND................................................................5

THE ACCOUNTS AND THE CONTRACTS.................................................5

INVESTMENT MANAGER.............................................................5

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS...........................5
FIXED INCOME PORTFOLIOS...............................................6
Diversified Bond Portfolio............................................6
Government Income Portfolio...........................................6
BALANCED PORTFOLIOS...................................................9
Conservative Balanced Portfolio.......................................9
Flexible Managed Portfolio...........................................10
DIVERSIFIED STOCK PORTFOLIOS.........................................11
Stock Index Portfolio................................................11
Equity Portfolio.....................................................13
Global Portfolio.....................................................13
CONVERTIBLE SECURITIES...............................................14
LOAN PARTICIPATIONS..................................................15
FOREIGN SECURITIES...................................................15
OPTIONS ON EQUITY SECURITIES.........................................16
OPTIONS ON DEBT SECURITIES...........................................17
OPTIONS ON STOCK INDICES.............................................17
OPTIONS ON FOREIGN CURRENCIES........................................18
FUTURES CONTRACTS....................................................19
OPTIONS ON FUTURES CONTRACTS.........................................19
REPURCHASE AGREEMENTS................................................20
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS.......................20
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES..........................20
SHORT SALES..........................................................20
SHORT SALES AGAINST THE BOX..........................................21
INTEREST RATE SWAPS..................................................21
LOANS OF PORTFOLIO SECURITIES........................................21

INVESTMENT RESTRICTIONS APPLICABLE TO THE PORTFOLIOS..........................22

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................22

PURCHASE AND REDEMPTION OF SHARES.............................................22

DETERMINATION OF NET ASSET VALUE..............................................23

DIVIDENDS, DISTRIBUTIONS, AND TAXES...........................................24

OTHER INFORMATION CONCERNING THE SERIES FUND..................................25
INCORPORATION AND AUTHORIZED STOCK...................................25
VOTING RIGHTS........................................................25
MONITORING FOR POSSIBLE CONFLICT.....................................25
PERIODIC REPORTS.....................................................25
PORTFOLIO BROKERAGE AND RELATED PRACTICES............................26
CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT.............26
ADDITIONAL INFORMATION...............................................26

APPENDIX: SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST..........................................................A1

<PAGE>

THE PRUDENTIAL SERIES FUND, INC.

FINANCIAL HIGHLIGHTS

(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS INDICATED)

To be filed by Post-Effective Amendment pursuant to Rule 485(b).

pages 1-4

1 - Series Fund
<PAGE>

THE SERIES FUND

The Prudential Series Fund, Inc. (the "Series Fund"), a diversified open-end
management investment company, is a Maryland corporation organized on November
15, 1982. The Prudential Variable Contract Account-24 may currently invest in
seven of the Series Fund's Portfolios: the Diversified Bond Portfolio, the
Government Income Portfolio, the Conservative Balanced Portfolio, the Flexible
Managed Portfolio, the Stock Index Portfolio, the Equity Portfolio, and the
Global Portfolio. Each portfolio is, for investment purposes, in effect a
separate investment fund, and a separate class of capital stock is issued for
each portfolio. In other respects the Series Fund is treated as one entity. Each
share of capital stock issued with respect to a portfolio has a pro-rata
interest in the assets of that portfolio and has no interest in the assets of
any other portfolio. Each portfolio bears its own liabilities and also its
proportionate share of the general liabilities of the Series Fund. The Series
Fund is registered under the Investment Company Act of 1940 (the "1940 Act") as
an open-end, diversified, management investment company. This registration does
not imply any supervision by the Securities and Exchange Commission over the
Series Fund's management or its investment policies or practices.

THE ACCOUNTS AND THE CONTRACTS

Shares in the Series Fund are currently sold only to separate accounts of The
Prudential Insurance Company of America ("Prudential") and certain other
insurers to fund benefits under variable life insurance and variable annuity
contracts issued by those Companies. All the separate accounts are referred to
as the "Accounts", and all the contracts are referred to as the "Contracts".
Each Contract owner or Participant allocates the net premiums and the assets
relating to the Contract, within the limitations described in the Contracts,
among the subaccounts of the Accounts which in turn invest in the corresponding
portfolios of the Series Fund. The attached prospectus for the Contracts
describes the particular type of Contract selected and the relationship between
changes in the value of shares of each portfolio and changes in the benefits
payable under the Contracts. The rights of the Accounts as shareholders should
be distinguished from the rights of a Contract owner or Participant which are
described in the Contracts. The terms "shareholder" or "shareholders" in this
prospectus refer to the Accounts.

INVESTMENT MANAGER

Prudential is the investment advisor of the Series Fund. Prudential's principal
business address is Prudential Plaza, Newark, New Jersey 07102-3777.

Prudential will continue to have responsibility for all investment advisory
services under its Investment Advisory Agreement with respect to the Series
Fund.

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

The portfolio turnover rate of the portfolios that were available for investment
as of December 31, 1996 can be found in the FINANCIAL HIGHLIGHTS table on pages
1 through 4. The portfolio turnover rate is, generally, the percentage computed
by dividing the lesser of portfolio purchases or sales by the average value of
the portfolio, in each case excluding securities with maturities of 1 year or
less. Generally, the higher the portfolio turnover rate, the greater the
brokerage costs incurred by a portfolio.

5 - Series Fund
<PAGE>

The following paragraphs describe the investment objectives and policies of each
portfolio available for investment by Participants in Prudential's MEDLEY
Program through corresponding subaccounts of The Prudential Variable Contract
Account-24. There is no guarantee that any of these objectives will be met.

FIXED INCOME PORTFOLIOS

The portfolio seeks to achieve this objective by following the policies of
purchasing primarily debt securities of investment grade or, if not rated, of
comparable quality in the opinion of the portfolio manager and of investing from
time to time a portion of its assets in high quality money market instruments of
the kind held by the Money Market Portfolio as described in the Appendix to this
prospectus. Moreover, when conditions dictate a temporary defensive strategy or
during temporary periods of portfolio structuring and restructuring, the
Diversified Bond Portfolio may invest, without limit, in high quality money
market instruments of the kind held by the Money Market Portfolio.

In addition, the portfolio may: (i) purchase and sell options on debt
securities; (ii) purchase and sell interest rate futures contracts and options
thereon; (iii) purchase securities on a when-issued or delayed delivery basis;
(iv) use interest rate swaps; and (v) make short sales. These techniques are
described on pages 17 through 21, and further information about some of them is
included in the statement of additional information.

6 - Series Fund
<PAGE>

obligations. These instruments are described below. The portfolio may invest up
to a total of 35% of its assets in the following three categories: (1) money
market instruments of the kind held by the Money Market Portfolio as described
in the Appendix to this prospectus; (2) securities of issuers other than the
U.S. government and related entities, usually foreign governments, where the
principal and interest are substantially guaranteed (generally to the extent of
90% thereof) by U.S. Government agencies whose guarantee is backed by the full
faith and credit of the United States and where an assurance of payment on the
unguaranteed portion is provided for in a comparable way; (3) Foreign Government
Securities including debt securities issued or guaranteed, as to payment of
principal and interest, by governments, governmental agencies, supranational
entities and other governmental entities denominated in U.S. dollars. A
supranational entity is an entity constituted by the national governments of
several countries to promote economic development. Examples of such
supranational entities include, among others, the World Bank (International Bank
for Reconstruction and Development), the European Investment Bank and the Asian
Development Bank; and (4) asset-backed securities rated in either of the top two
ratings by Moody's or Standard & Poor's, or if not rated, determined by the
portfolio manager to be of comparable quality. A description of corporate bond
ratings is contained in the Appendix to the statement of additional information.
When conditions dictate a temporary defensive strategy or during temporary
periods of portfolio structuring and restructuring, the Government Income
Portfolio may invest, without limit, in high quality money market instruments of
the kind held by the Money Market Portfolio.

U.S. Government Securities are considered among the most creditworthy of fixed
income investments. The yields available from U.S. Government Securities are
generally lower than the yields available from corporate debt securities. The
values of U.S. Government Securities (like those of fixed income securities,
generally) will change as interest rates fluctuate. During periods of falling
U.S. interest rates, the values of outstanding long-term U.S. Government
Securities generally rise. Conversely, during periods of rising interest rates,
the values of such securities generally decline. The magnitude of these
fluctuations will generally be greater for securities with longer maturities.
Although changes in the value of U.S. Government Securities will not affect
investment income from those securities, they will affect the portfolio's net
asset value. The proportions of intermediate and long-term securities held in
the portfolio will vary to reflect Prudential's assessment of prospective
changes in interest rates, so that the portfolio may benefit from relative price
appreciation when interest rates decline and suffer lesser declines in value
when interest rates rise. The success of this strategy will depend on
Prudential's ability to forecast changes in interest rates, and there is a
corresponding risk that the value of the securities held in the portfolio will
decline.

7 - Series Fund
<PAGE>

nationally recognized rating service or, if unrated, of comparable quality in
the opinion of the portfolio manager. The mortgages backing these securities
include conventional 30 year fixed rate mortgages, 15 year fixed rate mortgages,
graduated payment mortgages, and adjustable rate mortgages (ARMs). The
mortgage-backed securities may include those representing an undivided ownership
interest in a pool of mortgages, e.g. GNMA, FNMA and FHLMC certificates. The
U.S. Government or the issuing agency guarantees the payment of interest and
principal of mortgage-backed securities issued by the U.S. Government or its
agencies/instrumentalities. However, these guarantees do not extend to the
securities' yield or value, which are likely to vary inversely with fluctuations
in interest rates, nor do the guarantees extend to the yield or value of the
portfolio's shares. Mortgage-backed securities are in most cases pass-through
instruments, through which the holders receive a share of all interest and
principal payments from the mortgages underlying the securities, net of certain
fees. Because the prepayment characteristics of the underlying mortgages vary,
it is not possible to predict accurately the average life of a particular issue
of pass-through securities. Mortgage-backed securities are often subject to more
rapid repayment then their stated maturity date would indicate as a result of
the pass-through of prepayments of principal on the underlying mortgage
obligations. For example, securities backed by mortgages with 30 year maturities
are customarily treated as prepaying fully in the 12th year and securities
backed by mortgages with 15 year maturities are customarily treated as prepaying
fully in the seventh year. While the timing of prepayments of graduated payment
mortgages differs somewhat from that of conventional mortgages, the prepayment
experience of graduated payment mortgages is basically the same as that of the
conventional mortgages of the same maturity dates over the life of the pool.
During periods of declining interest rates, prepayment of mortgages underlying
mortgage-backed securities can be expected to accelerate. When the mortgage
obligations are prepaid, the portfolio reinvests the prepaid amounts in
securities, the yields of which reflect interest rates prevailing at the time.
Therefore, the portfolio's ability to maintain a portfolio of high yielding
mortgage-backed securities will be adversely affected to the extent that
prepayments of mortgages must be reinvested in securities which have lower
yields than the prepaid mortgages. Moreover, prepayments of mortgages which
underlie securities purchased at a premium could result in capital losses.
Mortgage-backed securities of the types described under (i) and (ii) above are
considered to be U.S. Government Securities for purposes of meeting the
requirement that at least 65% of the portfolio's assets be invested in U.S.
Government Securities.

CMOs. The portfolio may also purchase collateralized mortgage obligations
("CMOs"). A CMO is a security issued by a corporation or a U.S. Government
instrumentality that is backed by a portfolio of mortgages or mortgage-backed
securities. The issuer's obligation to make interest and principal payments is
secured by the underlying portfolio of mortgages or mortgage-backed securities.
CMOs are partitioned into several classes with a ranked priority by which the
classes of obligations are redeemed. The portfolio may invest in CMOs issued by
agencies or instrumentalities of the U.S. Government or by private originators
of, or investors in mortgage loans, including depository institutions, mortgage
banks, investment banks and special purpose subsidiaries of the foregoing. With
respect to privately issued CMOs, the portfolio will only purchase such
securities rated not lower than Aa by Moody's or AA by Standard & Poor's or
similarly rated by another nationally recognized rating service, or if unrated,
of comparable quality in the opinion of the portfolio manager. Privately issued
CMOs that are collateralized by mortgage-backed securities issued by GNMA, FHLMC
or FNMA, and CMOs issued by agencies or instrumentalities of the U.S. Government
are considered to be U.S. Government Securities for purposes of meeting the
requirement that at least 65% of the portfolio's assets be invested in U.S.
Government Securities. Neither the United States Government nor any U.S.
Government agency guarantees the payment of principal or interest on these
securities.

In addition, the portfolio may: (i) purchase and sell options on debt
securities; (ii) purchase and sell interest rate futures contracts and options
thereon; (iii) purchase securities on a when-issued or delayed delivery basis;
(iv) use interest rate swaps; and (v) make short sales. These techniques are
described on pages 17 through 21, and further information about some of them is
included in the statement of additional information.

8 - Series Fund
<PAGE>

BALANCED PORTFOLIOS

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 15% 35% 50%
Bonds and Money Market 25% 65% 70%

The bond portion of this portfolio will be invested primarily in securities with
maturities of 2 to 10 years and ratings at the time of purchase within the four
highest grades determined by Moody's, S&P, or a similar nationally-recognized
rating service or if unrated, of comparable quality in the opinion of the
portfolio manager. However, the portfolio may purchase below-investment grade
debt, also known as high risk securities. A description of corporate bond
ratings is contained in the Appendix to the statement of additional information.
Because of their shorter maturities, the value of the notes and bonds in this
portfolio will be less sensitive to changes in interest rates than the
longer-term bonds likely to be held in the Flexible Managed Portfolio. Thus,
there will be less of a risk of loss of principal, but not as much of a
likelihood for greater appreciation in value. Up to 20% of the bond portion of
this portfolio may be invested in United States currency denominated debt
securities issued outside the United States by foreign or domestic issuers. The
stock portion of this portfolio will be invested primarily in the equity
securities of major, established corporations in sound financial condition that
appear to offer attractive prospects of a total return from dividends and
capital appreciation that is superior to broadly based stock indices. The
portfolio may also invest in preferred stock, including below investment grade
preferred stock. The money market portion of the portfolio will hold high
quality money market instruments of the kind held by the Money Market Portfolio
as described in the Appendix to this prospectus. Moreover, when conditions
dictate a temporary defensive strategy or during temporary periods of portfolio
structuring and restructuring, the Conservative Balanced Portfolio may invest,
without limit, in high quality money market instruments of the kind held by the
Money Market Portfolio.

To the extent permitted by applicable insurance law, this portfolio may invest
up to 30% of its total assets in nonUnited States currency denominated debt and
equity securities of foreign and U.S. issuers. The particular risks of
investments in foreign securities are described under FOREIGN SECURITIES on page
15.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
on pages 16 through 21, and further information about some of them is included
in the statement of additional information.

9 - Series Fund
<PAGE>

Employees and Special Agents. Prior to 1994, he was responsible for corporate
pension asset management for Prudential Diversified Investment Strategies'
corporate clients.

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 25% 60% 100%
Bonds 0% 40% 75%
Money Market 0% 0% 75%

The bond component of this portfolio is expected under normal circumstances to
have a weighted average maturity of greater than 10 years. The values of bonds
with long maturities are generally more sensitive to changes in interest rates
than those of shorter maturities. The bond portion of this portfolio will
primarily be invested in securities that have a rating at the time of purchase
within the four highest grades determined by Moody's, S&P, or a similar
nationally-recognized rating service. A description of corporate bond ratings is
contained in the Appendix to the statement of additional information. However,
up to 25% of the bond component of this portfolio may be invested in securities
having ratings at the time of purchase of "BB", "Ba" or lower, or if not rated,
of comparable quality in the opinion of the portfolio manager, also known as
high risk securities. Up to 20% of the bond portion of this portfolio may be
invested in United States currency denominated debt securities issued outside
the United States by foreign or domestic issuers. The established company common
stock component of this portfolio will consist of the equity securities of major
corporations that are believed to be in sound financial condition. In selecting
stocks of smaller capitalization companies, the portfolio manager will
concentrate on companies with a capitalization below $5 billion that show above
average profitability (measured by return-on-equity, earnings, and dividend
growth rates) with modest price/earnings ratios. The individual equity
selections for this portfolio may tend to have more volatile market values than
the equity securities selected for the Equity Portfolio or the Conservative
Balanced Portfolio. The portfolio may also invest in preferred stock, including
below investment grade preferred stock. The money market portion of the
portfolio will hold high quality money market instruments of the kind held by
the Money Market Portfolio as described in the Appendix to this prospectus.
Moreover, when conditions dictate a temporary defensive strategy or during
temporary periods of portfolio structuring and restructuring, the Flexible
Managed Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
on pages 16 through 21, and further information about some of them is included
in the statement of additional information.

10 - Series Fund
<PAGE>

Employees and Special Agents. Prior to 1994, he was responsible for corporate
pension asset management for Prudential Diversified Investment Strategies'
corporate clients.

DIVERSIFIED STOCK PORTFOLIOS

STOCK INDEX PORTFOLIO. The objective of this portfolio is to achieve investment
results that correspond to the price and yield performance of publicly-traded
common stocks in the aggregate.

11 - Series Fund
<PAGE>

- --------------------------------------------------------------------------------
*S&P 500 WITH DIVIDENDS REINVESTED
ANNUAL PERCENTAGE CHANGE
- --------------------------------------------------------------------------------
1972 +18.90 1985 +31.57
1973 -14.77 1986 +18.56
1974 -26.39 1987 +5.10
1975 +37.16 1988 +16.61
1976 +23.57 1989 +31.69
1977 -7.42 1990 -3.10
1978 +6.38 1991 +30.47
1979 +18.20 1992 +7.61
1980 +32.27 1993 +10.08
1981 -5.01 1994 +1.32
1982 +21.44 1995 +37.58
1983 +22.38 1996 +22.96
1984 +6.10
- --------------------------------------------------------------------------------
Source: Standard & Poor's Corporation. Percentage change calculated in
accordance with specifications of SEC release number IA-327.
- --------------------------------------------------------------------------------

In the nine full years since this portfolio was established its total return,
compared to that of the S&P 500 Index, was as follows:

- --------------------------------------------------------------------------------
ANNUAL PERCENTAGE CHANGE TOTAL RETURN
S&P 500 WITH STOCK INDEX PORTFOLIO
DIVIDENDS REINVESTED (AFTER DEDUCTION OF EXPENSES)
- --------------------------------------------------------------------------------
1988 +16.61 +15.44
1989 +31.69 +30.93
1990 -3.10 -3.63
1991 +30.47 +29.72
1992 +7.61 +7.13
1993 +10.08 +9.66
1994 +1.32 +1.01
1995 +37.58 +37.06
1996 +22.96 +22.57
- --------------------------------------------------------------------------------

Under normal circumstances, the portfolio generally intends to purchase all 500
stocks represented in the S&P 500 Index and to invest its assets as fully in
those stocks (in proportion to their weighting in the index) as is feasible in
light of cash flows into and out of the portfolio. In order to reduce
transaction costs, a weighted investment in the 500 stocks comprising the S&P
500 Index is most efficiently made in relatively large amounts. As additional
cash is received from the purchase of shares in the portfolio, it may be held
temporarily in the types of money market instruments described in the Appendix
to this prospectus, until the portfolio has a sufficient amount of assets in
such investments to make an efficient weighted investment in the 500 stocks
comprising the S&P 500 Index. If net cash outflows from the portfolio are
anticipated, the portfolio may sell stocks (in proportion to their weighting in
the S&P 500 Index) in amounts in excess of those needed to satisfy the cash
outflows and hold the balance of the proceeds in short-term investments if such
a transaction appears, taking into account transaction costs, to be more
efficient than selling only the amount of stocks needed to meet the cash
requirements. The portfolio will not, however, increase its holdings of cash in
anticipation of any decline in the value of the S&P 500 Index or of the stock
markets generally. The portfolio will instead remain as fully invested in the
S&P 500 Index stocks as feasible in light of its cash flow patterns during
periods of market declines as well as advances, and investors in the portfolio
thus run the risk of remaining fully invested in common stocks during a period
of general decline in the stock markets.

12 - Series Fund
<PAGE>

in the value of the stocks held in the portfolio, but instead will employ them
only as a temporary substitute for investment of cash holdings directly in the
500 stocks when the portfolio's cash holdings are too small to make such an
investment in an efficient manner.

Although the portfolio will be invested primarily in common stocks, it may also
invest to a limited extent in short, intermediate or long-term debt, either
convertible or nonconvertible into common stock, as well as in nonconvertible
preferred stock. In addition, it may also invest up to 5% of its assets in below
investment grade debt securities, also known as high risk securities. A
description of corporate bond ratings is contained in the Appendix to the
statement of additional information. The portfolio will attempt to maintain a
flexible approach to the selection of common stocks of various types of
companies whose valuations appear to offer opportunities for above-average
appreciation. Thus, the portfolio may invest in securities of companies whose
estimated growth in earnings exceeds that projected for the market as a whole
because of factors such as expanding market share, new products or changes in
market environment. Or it may invest in "undervalued" securities which are often
characterized by a lack of investor recognition of the basic value of a
company's assets. Securities of companies with sales and earnings trends which
are currently unfavorable but which are expected to reverse may also be in the
portfolio. The effort to achieve price appreciation that is superior to broadly
based stock indices necessarily involves accepting a greater risk of declining
values. During periods when stock prices decline generally, it can be expected
that the value of the portfolio will also decline.

To the extent permitted by applicable insurance law, this portfolio may invest
up to 30% of its total assets in nonUnited States currency denominated common
stock and fixed-income securities convertible into common stock of foreign and
U.S. issuers. The particular risks of investments in foreign securities are
described under FOREIGN SECURITIES on page 15.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices and foreign currencies; (ii) purchase and sell stock
index and foreign currency futures contracts and options thereon; (iii) enter
into forward foreign currency exchange contracts; and (iv) purchase securities
on a when-issued or delayed delivery basis. These techniques are described on
pages 16 through 21, and further information about some of them is included in
the statement of additional information.

A portion of the portfolio may be invested in money market instruments of the
kind held by the Money Market Portfolio as described in the Appendix to this
prospectus in order to make effective use of cash reserves pending investment in
common stocks. Moreover, when conditions dictate a temporary defensive strategy
or during temporary periods of portfolio structuring and restructuring, the
Equity Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio.

Thomas Jackson, Managing Director, Prudential Investments, has been portfolio
manager of the Equity Portfolio since 1990. Mr. Jackson is also portfolio
manager of the Prudential Equity Fund, Inc.

13 - Series Fund
<PAGE>

foreign countries; expected levels of inflation and interest rates; government
policies influencing business conditions; the range of individual investment
opportunities available to international investors; and other pertinent
financial, tax, social, political and national factors--all in relation to the
prevailing prices of the securities in each country or region.

Investing in securities of foreign companies and countries involves special
risks. The particular risks of investments in foreign securities are described
under FOREIGN SECURITIES on page 15.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, stock indices and foreign currencies; (ii) purchase and sell stock
index, interest rate and foreign currency futures contracts and options thereon;
(iii) enter into forward foreign currency exchange contracts; and (iv) purchase
securities on a when-issued or delayed delivery basis. These techniques are
described on pages 15 through 21, and further information about some of them is
included in the statement of additional information.

As a result of its investment policies, the portfolio's turnover rate may exceed
100% although it is not expected to exceed 200%.

CONVERTIBLE SECURITIES

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
invest in convertible securities and such securities may constitute a major part
of the holdings of the Global Portfolio. A convertible security is a
fixed-income security (a bond or preferred stock) which may be converted at a
stated price within a specified period of time into a certain quantity of the
common stock of the same or a different issuer. Convertible securities are
senior to common stocks in a corporation's capital structure, but are usually
subordinated to similar nonconvertible securities. While providing a fixed
income stream (generally higher in yield than the income derivable from a common
stock but lower than that afforded by a similar nonconvertible security), a
convertible security also affords an investor the opportunity, through its
conversion feature, to participate in the capital appreciation attendant upon a
market price advance in the convertible security's underlying common stock. The
price of a convertible security tends to increase as the market value of the
underlying stock rises, whereas it tends to decrease as the market value of the
underlying stock declines. While no securities investment is without risk,
investments in convertible securities generally entail less risk than
investments in the common stock of the same issuer.

14 - Series Fund
<PAGE>

LOAN PARTICIPATIONS

FOREIGN SECURITIES

The Global Portfolio may invest up to 100% of its total assets in common stock
and convertible securities denominated in a foreign currency and issued by
foreign or domestic issuers. The Diversified Bond Portfolio may invest up to 20%
of its assets in United States currency denominated debt securities issued
outside the United States by foreign or domestic issuers. In addition, the bond
components of the Conservative Balanced and Flexible Managed Portfolios may each
invest up to 20% of their assets in such securities. To the extent permitted by
applicable law, the Conservative Balanced, and Flexible Managed Portfolios may
invest up to 30% of their total assets in debt and equity securities denominated
in a foreign currency and issued by foreign or domestic issuers. Further, to the
extent permitted by applicable insurance law, the Equity Portfolio may invest up
to 30% of its total assets in non-United States currency denominated common
stock and fixed-income securities convertible into common stock of foreign and
U.S. issuers. Securities issued outside the United States and not publicly
traded in the United States, as well as American Depository Receipts ("ADRs"),
and securities denominated in a foreign currency are referred to collectively in
this prospectus as "foreign securities."

If the security is denominated in foreign currency, it may be affected by
changes in currency rates and in exchange control regulations, and costs may be
incurred in connection with conversions between currencies. The portfolios that
may invest in foreign securities may, but need not, enter into forward foreign
currency exchange contracts for the purchase or sale of foreign currency for
hedging purposes, including: locking-in the U.S. dollar price equivalent of
interest or dividends to be paid on such securities which are held by the
portfolio; and protecting the U.S. dollar value of such securities which are
held by the portfolio. The portfolios will not enter into such forward contracts
or maintain a net exposure to such contracts where the consummation of the
contracts would obligate the portfolio to deliver an amount of foreign currency
in excess of the value of the portfolio's portfolio securities or other assets
denominated in that currency. See FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS in
the statement of additional information. In addition, the portfolios may, for
hedging purposes, enter into certain transactions involving options on foreign
currencies, foreign currency futures contracts and options on foreign currency
futures contracts. See OPTIONS ON FOREIGN CURRENCIES, FUTURES CONTRACTS, and
OPTIONS ON FUTURES CONTRACTS on pages 18 through 19.

15 - Series Fund
<PAGE>

OPTIONS ON EQUITY SECURITIES

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
purchase and write (i.e., sell) put and call options on equity securities that
are traded on securities exchanges, are listed on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), or that result from
privately negotiated transactions with broker-dealers ("OTC options"). A call
option is a short-term contract pursuant to which the purchaser or holder, in
return for a premium paid, has the right to buy the equity security underlying
the option at a specified exercise price at any time during the term of the
option. The writer of the call option, who receives the premium, has the
obligation, upon exercise of the option, to deliver the underlying equity
security against payment of the exercise price. A put option is a similar
contract which gives the purchaser or holder, in return for a premium, the right
to sell the underlying equity security at a specified price during the term of
the option. The writer of the put, who receives the premium, has the obligation
to buy the underlying equity security at the exercise price upon exercise by the
holder of the put.

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
also purchase "protective puts" (i.e., put options acquired for the purpose of
protecting a portfolio security from a decline in market value). In exchange for
the premium paid for the put option, the portfolio acquires the right to sell
the underlying security at the exercise price of the put regardless of the
extent to which the underlying security declines in value. The loss to the
portfolio is limited to the premium paid for, and transaction costs in
connection with, the put plus the initial excess, if any, of the market price of
the underlying security over the exercise price. However, if the market price of
the security underlying the put rises, the profit the portfolio realizes on the
sale of the security will be reduced by the premium paid for the put option less
any amount (net of transaction costs) for which the put may be sold. Similar
principles apply to the purchase of puts on debt securities and stock indices,
as described under OPTIONS ON DEBT SECURITIES, below and OPTIONS ON STOCK
INDICES, page 17.

16 - Series Fund
<PAGE>

OPTIONS ON DEBT SECURITIES

The Diversified Bond, Government Income, Conservative Balanced, and Flexible
Managed Portfolios may purchase and write (i.e. sell) put and call options on
debt securities (including U.S. Government debt securities) that are traded on
U.S. securities exchanges or that result from privately negotiated transactions
with primary U.S. Government securities dealers recognized by the Federal
Reserve Bank of New York ("OTC options"). Options on debt are similar to options
on stock, except that the option holder has the right to take or make delivery
of a debt security, rather than stock.

These portfolios may purchase "protective puts" in an effort to protect the
value of a security that it owns against a substantial decline in market value.
Protective puts are described in OPTIONS ON EQUITY SECURITIES, page 16. A
portfolio may wish to protect certain portfolio securities against a decline in
market value at a time when put options on those particular securities are not
available for purchase. A portfolio may therefore purchase a put option on
securities other than those it wishes to protect even though it does not hold
such other securities in its portfolio. While changes in the value of the put
option should generally offset changes in the value of the securities being
hedged, the correlation between the two values may not be as close in these
transactions as in transactions in which the portfolio purchases a put option on
an underlying security it owns.

OPTIONS ON STOCK INDICES

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
purchase and sell put and call options on stock indices traded on securities
exchanges, listed on NASDAQ or that result from privately negotiated
transactions with broker-dealers ("OTC options"). The Stock Index Portfolio may
utilize options on stock indices by constructing "put/call" combinations that
are economically comparable to a long stock index futures position,

17 - Series Fund
<PAGE>

as described in the statement of additional information. Options on stock
indices are similar to options on stock except that, rather than the right to
take or make delivery of stock at a specified price, an option on a stock index
gives the holder the right to receive, upon exercise of the option, an amount of
cash if the closing level of the stock index upon which the option is based is
greater than, in the case of a call, or less than, in the case of a put, the
exercise price of the option. This amount of cash is equal to such difference
between the closing price of the index and the exercise price of the option
expressed in dollars times a specified multiple (the "multiplier"). The writer
of the option is obligated, in return for the premium received, to make delivery
of this amount. Unlike stock options, all settlements are in cash, and gain or
loss depends on price movements in the stock market generally (or in a
particular industry or segment of the market) rather than price movements in
individual stocks.

A portfolio will write only "covered" options on stock indices. The manner in
which these options are covered is discussed in the statement of additional
information.

OPTIONS ON FOREIGN CURRENCIES

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
purchase and write put and call options on foreign currencies traded on U.S. or
foreign securities exchanges or boards of trade for hedging purposes in a manner
similar to that in which forward foreign currency exchange contracts (discussed
under FOREIGN SECURITIES, page 15 and futures contracts on foreign currencies
(discussed under FUTURES CONTRACTS, below) will be employed. Options on foreign
currencies are similar to options on stock, except that the option holder has
the right to take or make delivery of a specified amount of foreign currency,
rather than stock.

The use of these options is subject to various additional risks. The correlation
between movements in the price of options and the price of the currencies being
hedged is imperfect. The use of these instruments will hedge only the currency
risks associated with investments in foreign securities, not market risks. The
portfolio's ability to establish and maintain positions will depend on market
liquidity. The ability of the portfolio to close out an option depends upon a
liquid secondary market. There is no assurance that liquid secondary markets
will exist for any particular option at any particular time.

18 - Series Fund
<PAGE>

FUTURES CONTRACTS

The Conservative Balanced, Flexible Managed, Stock Index, Equity, and Global
Portfolios may, to the extent permitted by applicable regulations, attempt to
reduce the risk of investment in equity securities by hedging a portion of their
equity portfolios through the use of stock index futures contracts. A stock
index futures contract is an agreement in which the seller of the contract
agrees to deliver to the buyer an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index is
made.

The Diversified Bond, Government Income, Conservative Balanced, Flexible
Managed, and Global Portfolios may, to the extent permitted by applicable
regulations, purchase and sell for hedging purpose futures contracts on
interest-bearing securities (such as U.S. Treasury bonds and notes) or interest
rate indices (referred to collectively as "interest rate futures contracts").

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may,
to the extent permitted by applicable regulations, purchase and sell futures
contracts on foreign currencies or groups of foreign currencies for hedging
purposes.

OPTIONS ON FUTURES CONTRACTS

To the extent permitted by applicable insurance law and federal regulations, the
Conservative Balanced, Flexible Managed, Stock Index, Equity, and Global
Portfolios may enter into certain transactions involving options on stock index
futures contracts; the Diversified Bond, Government Income, Conservative
Balanced, Flexible Managed, and Global Portfolios may enter into certain
transactions involving options on interest rate futures contracts; and the
Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may enter
into certain transactions involving options on foreign currency futures
contracts. An option on a futures contract gives the purchaser or holder the
right, but not the obligation, to assume a position in a futures contract (a
long position if the option is a call and a short position if the option is a
put) at a specified price at any time during the option exercise period. The
writer of the option is required upon exercise to assume an offsetting futures
position (a short position if the option is a call and long position if the
option is a put). Upon exercise of the option, the assumption of offsetting
futures positions by the writer and holder of the option will be accomplished by
delivery of the accumulated balance in the writer's futures margin account which
represents the amount by which the market price of the futures contract, at
exercise, exceeds, in the case of a call, or is less than, in the case of a put,
the exercise price of the option on the futures contract. As an alternative to
exercise, the holder or writer of an option may terminate a position by selling
or purchasing an option of the same series. There is no guarantee that such
closing transactions can be effected. The Stock Index Portfolio intends to
utilize options on stock index futures contracts by constructing "put/call"
combinations that are economically comparable to a long stock index futures
position, as described in the statement of additional information. The other
portfolios intend to utilize options on futures contracts for the same purposes
that they use the underlying futures contracts.

19 - Series Fund
<PAGE>

REPURCHASE AGREEMENTS

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS

The Diversified Bond and Government Income Portfolios, as well as the fixed
income portions of the Conservative Balanced and Flexible Managed Portfolios,
may use reverse repurchase agreements and dollar rolls. The money market portion
of any portfolio may use reverse repurchase agreements. Reverse repurchase
agreements involve the sale of securities held by a portfolio with an agreement
by the portfolio to repurchase the same securities at an agreed upon price and
date. During the reverse repurchase period, the portfolio often continues to
receive principal and interest payments on the sold securities. The terms of
each agreement reflect a rate of interest for use of the funds for the period,
and thus these agreements have the characteristics of borrowing by the
portfolio. Dollar rolls involve sales by a portfolio of securities for delivery
in the current month with a simultaneous contract to repurchase substantially
similar securities (same type and coupon) from the same party at an agreed upon
price and date. During the roll period, the portfolio forgoes principal and
interest paid on the securities. A portfolio is compensated by the difference
between the current sales price and the forward price for the future purchase
(often referred to as the "drop") as well as by the interest earned on the cash
proceeds of the initial sale. A "covered roll" is a specific type of dollar roll
for which there is an offsetting cash position or a cash equivalent security
position which matures on or before the forward settlement date of the dollar
roll transaction. A portfolio will establish a segregated account with its
custodian in which it will maintain cash, U.S. Government securities or other
liquid unencumbered assets equal in value to its obligations in respect of
reverse repurchase agreements and dollar rolls. Reverse repurchase agreements
and dollar rolls involve the risk that the market value of the securities
retained by the portfolio may decline below the price of the securities the
portfolio has sold but is obligated to repurchase under the agreement. In the
event the buyer of securities under a reverse repurchase agreement or dollar
roll files for bankruptcy or becomes insolvent, the portfolio's use of the
proceeds of the agreement may be restricted pending a determination by the other
party, or its trustee or receiver, whether to enforce the portfolio's obligation
to repurchase the securities. The Diversified Bond and Government Income
Portfolios, as well as the fixed income portions of the Conservative Balanced
and Flexible Managed Portfolios, will not obligate more than 30% of their net
assets in connection with reverse repurchase agreements and dollar rolls. No
other portfolio will obligate more than 10% of its net assets in connection with
reverse repurchase agreements.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES

From time to time, in the ordinary course of business, the Diversified Bond,
Government Income, Conservative Balanced, Flexible Managed, Equity and Global
Portfolios may purchase or sell securities on a when-issued or delayed delivery
basis, that is, delivery and payment can take place a month or more after the
date of the transaction. A portfolio will make commitments for such when-issued
transactions only with the intention of actually acquiring the securities. A
portfolio's custodian will maintain, in a separate account, cash, U.S.
Government securities or other liquid unencumbered assets having a value equal
to or greater than such commitments. If a portfolio chooses to dispose of the
right to acquire a when-issued security prior to its acquisition, it could, as
with the disposition of any other portfolio security, incur a gain or loss due
to market fluctuations.

In addition, the short-term portions of any of the portfolios may purchase money
market securities on when-issued or delayed delivery basis on the terms set
forth in the Appendix to this prospectus.

SHORT SALES

The Diversified Bond, Government Income, Conservative Balanced and Flexible
Managed Portfolios may sell securities they do not own in anticipation of a
decline in the market value of those securities ("short sales"). To complete
such a transaction, the portfolio will borrow the security to make delivery to
the buyer. The portfolio is then obligated to replace the security borrowed by
purchasing it at the market price at the time of replacement.

20 - Series Fund
<PAGE>

The price at such time may be more or less than the price at which the security
was sold by the portfolio. Until the security is replaced, the portfolio is
required to pay to the lender any interest which accrues during the period of
the loan. To borrow the security the portfolio may be required to pay a premium
which would increase the cost of the security sold. The proceeds of the short
sale will be retained by the broker to the extent necessary to meet margin
requirements until the short position is closed out. Until the portfolio
replaces the borrowed security, it will (a) maintain in a segregated account
cash, U.S. Government securities or other liquid unencumbered assets at such a
level that the amount deposited in the account plus the amount deposited with
the broker as collateral will equal the current market value of the security
sold short and will not be less than the market value of the security at the
time it was sold short or (b) otherwise cover its short position.

SHORT SALES AGAINST THE BOX

All portfolios available to The Prudential Variable Contract Account-24 may make
short sales of securities or maintain a short position, provided that at all
times when a short position is open the portfolio owns an equal amount of such
securities or securities convertible into or exchangeable, with or without
payment of any further consideration, for an equal amount of the securities of
the same issuer as the securities sold short (a "short sale against the box");
provided, that if further consideration is required in connection with the
conversion or exchange, cash, U.S. Government securities or other liquid
unencumbered assets in an amount equal to such consideration must be put in a
segregated account.

INTEREST RATE SWAPS

The Diversified Bond and Government Income Portfolios and the fixed income
portions of the Conservative Balanced and Flexible Managed Portfolios may use
interest rate swaps to increase or decrease a portfolio's exposure to long- or
short-term interest rates. No portfolio currently intends to invest more than 5%
of its net assets at any one time in interest rate swaps. For more information,
see the statement of additional information.

LOANS OF PORTFOLIO SECURITIES

All of the portfolios available to The Prudential Variable Contract Account-24
may from time to time lend the securities they hold to broker-dealers, provided
that such loans are made pursuant to written agreements and are continuously
secured by collateral in the form of cash, U.S. Government securities or
irrevocable standby letters of credit in an amount equal to at least the market
value at all times of the loaned securities plus the accrued interest and
dividends. During the time securities are on loan, the portfolio will continue
to receive the interest and dividends or amounts equivalent thereto, on the
loaned securities while receiving a fee from the borrower or earning interest on
the investment of the cash collateral. The right to terminate the loan will be
given to either party subject to appropriate notice. Upon termination of the
loan, the borrower will return to the lender securities identical to the loaned
securities. The portfolio will not have the right to vote securities on loan,
but would terminate the loan and retain the right to vote if that were
considered important with respect to the investment.

21 - Series Fund
<PAGE>

INVESTMENT RESTRICTIONS APPLICABLE
TO THE PORTFOLIOS

The Series Fund is subject to certain investment restrictions which are
fundamental to the operations of the Series Fund and may not be changed except
with the approval of a majority vote (as defined under INVESTMENT OBJECTIVES AND
POLICIES OF THE PORTFOLIOS on page 5) of the persons participating in the
affected portfolio.

The investments of the various portfolios currently available to The Prudential
Variable Contract Account-24 are generally subject to certain additional
restrictions under state laws. In the event of future amendments to the
applicable statutes, each of these portfolios will comply, without the approval
of the shareholders, with the statutory requirements as so modified.

For a detailed discussion of investment restrictions applicable to the Series
Fund, see INVESTMENT RESTRICTIONS in the statement of additional information.

INVESTMENT MANAGEMENT ARRANGEMENTS
AND EXPENSES

Subject to Prudential's supervision, substantially all of the investment
advisory services provided to the Series Fund by Prudential, with respect to the
portfolios currently available to The Prudential Variable Contract Account-24,
are furnished by its wholly-owned subsidiary, PIC, pursuant to the Service
Agreement between Prudential and PIC which provides that a portion of the fee
received by Prudential for providing investment advisory services will be paid
to PIC. PIC is registered as an investment advisor under the Investment Advisers
Act of 1940.

The investment management fee for the Stock Index Portfolio is equal to an
annual rate of 0.35% of the average daily net assets of the portfolio. The
investment management fee for the Diversified Bond and Government Income
Portfolios is equal to an annual rate of 0.4% of the average daily net assets of
each of the portfolios. For the Equity Portfolio, the fee is equal to an annual
rate of 0.45% of the average daily net assets of the portfolio. The fee for the
Conservative Balanced is equal to an annual rate of 0.55% of the average daily
net assets of the portfolio. For the Flexible Managed Portfolio, the fee is
equal to an annual rate of 0.6% of the average daily net assets of the
portfolio. The fee for the Global Portfolio is equal to an annual rate of 0.75%
of the average daily net assets of the portfolio.

For the year ended December 31, 1996, the Series Fund's total expenses were
0.xx% of the average net assets of all of the Series Fund's portfolios. The
investment management fee for that period constituted 0.xx% of the average net
assets. For further information about the expenses of the Series Fund, see
INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES in the statement of additional
information.

PURCHASE AND REDEMPTION OF SHARES

22 - Series Fund
<PAGE>

Securities Corporation ("Prusec"), an indirect wholly-owned subsidiary of
Prudential, acts as the principal underwriter of the Series Fund. Prusec's
principal business address is 213 Washington Street, Newark, New Jersey
07102-2992.

DETERMINATION OF NET ASSET VALUE

The net asset value of the shares of each portfolio available to The Prudential
Variable Contract Account-24 is determined once daily, as of 4:15 p.m. New York
City time on each day during which the NYSE is open for business. The NYSE is
open for business Monday through Friday except for the days on which the
following holidays are observed: New Year's Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.
In the event the New York Stock Exchange closes early on any business day, the
net asset value of each portfolio shall be determined at a time between such
closing and 4:15 p.m. New York City time. The net asset value per share of each
such portfolio is computed by adding the sum of the value of the securities held
by that portfolio plus any cash or other assets it holds, subtracting all its
liabilities, and dividing the result by the total number of shares outstanding
of that portfolio at such time. Expenses, including the investment management
fee payable to Prudential, are accrued daily.

In determining the net asset value of the Diversified Bond and Government Income
Portfolios, securities (other than debt obligations with remaining maturities of
less than 60 days, which are valued at amortized cost) will be valued utilizing
an independent pricing service to determine valuations for normal institutional
size trading units of securities. The pricing service considers such factors as
security prices, yields, maturities, call features, ratings, and developments
relating to specific securities in arriving at securities valuations.

The net asset value of the Stock Index, Equity, and Global Portfolios will be
determined in the following manner. Any security for which the primary market is
on an exchange is generally valued at the last sale price on such exchange as of
the close of the NYSE (which is currently 4:00 p.m. New York City time) or, in
the absence of recorded sales, at the mean between the most recently quoted bid
and asked prices. NASDAQ National Market System equity securities are valued at
the last sale price or, if there was no sale on such day, at the mean between
the most recently quoted bid and asked prices. Other over-the-counter equity
securities are valued at the mean between the most recently quoted bid and asked
prices. Convertible debt securities that are actively traded in the
over-the-counter market, including listed securities for which the primary
market is believed to be over-the-counter, are valued at the mean between the
most recently quoted bid and asked prices. Short-term debt instruments which
mature in less than 60 days are valued at amortized cost. For valuation
purposes, quotations of foreign securities in a foreign currency are converted
to U.S. dollar equivalents.

In determining the net asset value of each of the Balanced Portfolios, the
method of valuation of a security depends on the type of investment involved.
Intermediate or long-term fixed income securities are valued in the same way as
such securities in the Diversified Bond Portfolio, and common stocks and
convertible debt securities are valued in the same way as such securities are
valued in the Equity Portfolio. With respect to the money market portion of the
Conservative Balanced and Flexible Managed Portfolios, all short-term debt
obligations with a maturity of 12 months or less are valued on an amortized cost
basis in accordance with an order obtained from the Securities and Exchange
Commission. Each Balanced Portfolio must maintain a dollar-weighted average
maturity for its short-term debt obligations of 120 days or less. The values
determined by the amortized cost method may deviate from market value under
certain circumstances. The Board of Directors has established procedures to
monitor

23 - Series Fund
<PAGE>

whether any material deviation occurs and, if so, will promptly consider what
action, if any, should be initiated to prevent unfair results to Contract
owners. The short-term portion of these portfolios may be invested only in high
quality instruments, as described in the Appendix to this prospectus.

Securities or assets for which market quotations are not readily available will
be valued at fair value as determined by Prudential under the direction of the
Board of Directors of the Series Fund.

DIVIDENDS, DISTRIBUTIONS, AND TAXES

The Series Fund will also declare and distribute annually all net realized
capital gains of the portfolios available to The Prudential Variable Contract
Account-24.

24 - Series Fund
<PAGE>

sections and the Treasury Regulations promulgated thereunder. The Code and these
Regulations are subject to change by legislative or administrative actions.

OTHER INFORMATION CONCERNING THE SERIES FUND

INCORPORATION AND AUTHORIZED STOCK

The Series Fund was incorporated under Maryland law on November 15, 1982. The
authorized Capital Stock of the Series Fund consists of 2 billion shares, par
value $0.01 per share. The shares of Capital Stock are divided into fifteen
classes: Money Market Portfolio Capital Stock (225 million shares), Diversified
Bond Portfolio Capital Stock (200 million shares), Government Income Portfolio
Capital Stock (100 million shares), Zero Coupon Bond Portfolio 2000 Capital
Stock (25 million shares), Zero Coupon Bond Portfolio 2005 Capital Stock (50
million shares), Conservative Balanced Portfolio Capital Stock (300 million
shares), Flexible Managed Portfolio Capital Stock (300 million shares), High
Yield Bond Portfolio Capital Stock (100 million shares), Stock Index Portfolio
Capital Stock (100 million shares), Equity Income Portfolio Capital Stock (100
million shares), Equity Portfolio Capital Stock (200 million shares), Prudential
Jennison Portfolio Capital Stock (50 million shares), Small Capitalization Stock
Portfolio Capital Stock (50 million shares), Global Portfolio Capital Stock (100
million shares), Natural Resources Portfolio Capital Stock (100 million shares).
The shares of each portfolio, when issued, will be fully paid and
non-assessable, will have no conversion, exchange or similar rights, and will be
freely transferable.

From time to time, Prudential has purchased Series Fund shares to provide
initial capital for the Series Fund and to enable portfolios to avoid
unrealistically poor investment performance that might otherwise result because
the amounts available for investment were too small. Prudential will not redeem
any of its shares until a portfolio is large enough so that redemption will not
have an adverse effect upon investment performance. As of December 31, 1996,
Prudential held $xxx,xxx,xxx worth of shares in the Global Portfolio. Prudential
will vote its shares in the same manner and in the same proportion as the shares
held in the Accounts, which generally are voted in accordance with instructions
of Contract owners.

VOTING RIGHTS

The voting rights of Contract owners or Participants, and limitations on those
rights, are explained in the accompanying prospectus for the Contracts.
Prudential and certain other insurers with separate accounts which invest in the
Series Fund, as the owners of the assets in the Accounts, vote all of the shares
of the Series Fund, but they will generally do so in accordance with the
instructions of Contract owners or Participants pursuant to the current SEC
requirements and staff interpretations regarding pass-through voting. Under
certain circumstances, however, the Companies may disregard voting instructions
received from Contract owners or Participants. The Series Fund does not hold
annual shareholders meetings in any year in which it is not required to do so
either under Maryland law or the Investment Company Act of 1940. For additional
information describing how the Companies will vote the shares of the Series
Fund, see Voting Rights in the accompanying prospectus for the Contracts.

MONITORING FOR POSSIBLE CONFLICT

PERIODIC REPORTS

The Series Fund will send each shareholder, at least annually, statements
showing as of a specified date the number of shares in each portfolio credited
to the shareholder. The Series Fund will also send Contract owners and
Participants semi-annual reports showing the financial condition of the
portfolios in which they may invest and the investments held in each. The annual
report may take the form of an updated copy of this prospectus and its
accompanying statement of additional information.

25 - Series Fund
<PAGE>

PORTFOLIO BROKERAGE AND RELATED PRACTICES

Prudential is responsible for decisions to buy and sell securities for the
portfolios, the selection of brokers and dealers to effect the transactions and
the negotiation of brokerage commissions, if any. Transactions on a stock
exchange in equity securities will be executed primarily through brokers that
will receive a commission paid by the portfolio. The Diversified Bond and
Government Income Portfolios, on the other hand, will not normally incur any
brokerage commissions. Fixed income securities, as well as equity securities
traded in the over-the-counter market, are generally traded on a "net" basis
with dealers acting as principals for their own accounts without a stated
commission, although the price of the security usually includes a profit to the
dealer. In underwritten offerings, securities are purchased at a fixed price
that includes an amount of compensation to the underwriter, generally referred
to as the underwriter's concession or discount. Certain of these securities may
also be purchased directly from an issuer, in which case neither commissions nor
discounts are paid.

CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT

ADDITIONAL INFORMATION

This prospectus and the statement of additional information referred to on the
cover page do not contain all the information set forth in the registration
statement, certain portions of which have been omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. The omitted information
may be obtained from the Commission's principal office in Washington, D.C., upon
payment of the fees prescribed by the Commission.

For further information, shareholders may also contact the Series Fund's office,
the address and phone number of which are set forth on the cover of this
prospectus.

26 - Series Fund
<PAGE>

APPENDIX

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST*

3. Commercial paper, variable amount demand master notes, bills, notes, and
other obligations issued by a U.S. company, a foreign company or a foreign
government, its agencies, instrumentalities or political subdivisions,
denominated in U.S. dollars, and, at the date of investment, rated at least A or
A-2 by Standard & Poor's Rating Service ("S&P"), A or Prime-2 by Moody's
Investors Service ("Moody's") or, if not rated, issued by an entity having an
outstanding unsecured debt issue rated at least A or A-2 by S&P or A or Prime-2
by Moody's. A description of corporate bond ratings is contained in the Appendix
to the statement of additional information. If such obligations are guaranteed
or supported by a letter of credit issued by a bank, such bank (including a
foreign bank) must meet the requirements set forth in paragraph 2 above. If such
obligations are guaranteed or insured by an insurance company or other non-bank
entity, such insurance company or other non-bank entity must represent a credit
of high quality, as determined by the Series Fund's investment advisor under the
supervision of the Series Fund's Board of Directors.

*Although the Money Market Portfolio is not available to The Prudential Variable
Contract Account-24, any short-term portion of the various portfolios available
through subaccounts of that Account may be invested in the types of securities
described in this Appendix.

A1 - Series Fund
<PAGE>

governmental laws or restrictions which might affect adversely the payment of
principal and interest on such obligations held by the Series Fund. In addition,
there may be less publicly available information about a foreign issuer than
about a domestic one, and foreign issuers may not be subject to the same
accounting, auditing and financial recordkeeping standards, and requirements as
domestic issuers. Securities issued by foreign issuers may be subject to greater
fluctuations in price than securities issued by U.S. entities. Finally, in the
event of a default with respect to any such foreign debt obligations, it may be
more difficult for the Series Fund to obtain or to enforce a judgment against
the issuers of such securities.

5. Reverse Repurchase Agreements. The Money Market Portfolio may use reverse
repurchase agreements, which are described on page 20 of the prospectus. No
portfolio may obligate more than 10% of its net assets in connection with
reverse repurchase agreements, except that the Diversified Bond and Government
Income Portfolios, as well as the fixed income portions of the Conservative
Balanced and Flexible Managed Portfolios, may obligate up to 30% of their net
assets in connection with reverse repurchase agreements and dollar rolls.

A2 - Series Fund
<PAGE>

PRUVIDER
VARIABLE
APPRECIABLE LIFE(R)
INSURANCE

MAY 1, 1997

PROSPECTUS

THE PRUCO LIFE PRUVIDER VARIABLE APPRECIABLE ACCOUNT
AND
THE PRUDENTIAL SERIES FUND, INC.

SVAL-1 ED 5-97 PRUCO LIFE INSURANCE COMPANY
CATALOG NO. 6469898

<PAGE>

PROSPECTUS

May 1, 1997

PRUCO LIFE INSURANCE COMPANY
PRUVIDER VARIABLE APPRECIABLE ACCOUNT

PRUVIDER(SM)

VARIABLE APPRECIABLE LIFE(R)

Insurance Contract

This prospectus describes a variable life insurance contract issued by Pruco
Life Insurance Company ("Pruco Life"), a stock life insurance company that is a
wholly-owned subsidiary of The Prudential Insurance Company of America
("Prudential"). Pruco Life calls this contract its PRUVIDER(sm) Variable
APPRECIABLE LIFE(R) Insurance Contract* (the "Contract"). The Contract provides
whole-life insurance protection. The death benefit varies daily with investment
experience but will never be less than a guaranteed minimum amount (the face
amount specified in the Contract). The Contract also generally provides a cash
surrender value which does not have a guaranteed minimum amount.

The assets held for the purpose of paying benefits under these and other similar
contracts are segregated from the other assets of Pruco Life and are invested in
one or both of the current subaccounts of the Pruco Life PRUVIDER Variable
Appreciable Account (from now on, the "Account"). In this case, the assets will
be invested in the corresponding portfolio of The Prudential Series Fund, Inc.
(from now on, the "Series Fund"). The two portfolios of the Series Fund
currently available to Contract owners are the CONSERVATIVE BALANCED PORTFOLIO
and the FLEXIBLE MANAGED PORTFOLIO. The contract owner may also choose to have
the assets invested in a FIXED-RATE OPTION. This prospectus describes the
Contract generally, the Pruco Life PRUVIDER Variable Appreciable Account and the
securities issued by the Series Fund.

Although it is advantageous to the purchaser to pay a Scheduled Premium amount
on the dates due, which are at least once a year but may be more often,
purchasers have flexibility as to when and in what amounts they pay premiums.

Before you sign an application to purchase this life insurance contract, you
should read this prospectus with care and have any questions you may have
answered by your Pruco Life representative. If you do purchase the Contract, you
should retain this prospectus for future reference, together with the Contract
itself that you will receive.

Additional information about the contract and the Series Fund is set forth in a
separate Statement of Additional Information which is incorporated by reference
into this prospectus. It is available without charge upon request to the Pruco
Life Insurance Company at the address shown below.

REPLACING EXISTING LIFE INSURANCE WITH A CONTRACT DESCRIBED IN THIS PROSPECTUS
MAY NOT BE TO YOUR ADVANTAGE. IF YOU CURRENTLY OWN A LIFE INSURANCE CONTRACT,
THE BENEFITS AND COSTS OF PURCHASING ADDITIONAL INSURANCE UNDER THE EXISTING
POLICY SHOULD BE COMPARED WITH THE BENEFITS AND COSTS OF PURCHASING THE CONTRACT
DESCRIBED IN THIS PROSPECTUS. IN MAKING THIS COMPARISON, YOU SHOULD CONSULT WITH
A QUALIFIED TAX ADVISOR.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

PRUCO LIFE INSURANCE COMPANY
213 Washington Street
Newark, New Jersey 07102-2992
Telephone: (800) 437-4016, Ext. 46

*PRUVIDER is a service mark of Prudential.
APPRECIABLE LIFE is a registered mark of Prudential.
SVAL-1 Ed. 5-97

<PAGE>

TABLE OF CONTENTS
Page

INTRODUCTION AND SUMMARY.......................................................1
BRIEF DESCRIPTION OF THE CONTRACT.....................................1
BALANCED PORTFOLIOS...................................................3
CONSERVATIVE BALANCED PORTFOLIO..............................3
FLEXIBLE MANAGED PORTFOLIO...................................3
FIXED-RATE OPTION.....................................................3
TRANSFERS BETWEEN INVESTMENT OPTIONS..................................3
THE SCHEDULED PREMIUM.................................................3
PAYMENT OF HIGHER PREMIUMS............................................3
CONTRACT LOANS........................................................3
PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACTS................3

FINANCIAL HIGHLIGHTS OF THE PORTFOLIOS OF THE SERIES FUND......................4

PORTFOLIO RATES OF RETURN......................................................6

ILLUSTRATIONS OF CASH SURRENDER VALUES, DEATH BENEFITS
AND ACCUMULATED PREMIUMS..............................................7

GENERAL INFORMATION ABOUT PRUCO LIFE PRUVIDER VARIABLE APPRECIABLE
ACCOUNT AND THE FIXED RATE OPTION.....................................8
PRUCO LIFE PRUVIDER VARIABLE APPRECIABLE ACCOUNT......................8
THE FIXED-RATE OPTION.................................................8

DETAILED INFORMATION FOR PROSPECTIVE CONTRACT OWNERS...........................9
REQUIREMENTS FOR ISSUANCE OF A CONTRACT...............................9
SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"..........................9
CONTRACT FEES AND CHARGES.............................................9
Deductions from Premiums.....................................9
Deductions from Portfolios...................................9
Monthly Deductions from Contract Fund.......................10
Daily Deduction from the Contract Fund......................11
Surrender or Withdrawal Charges.............................11
Transaction Charges.........................................12
CONTRACT DATE........................................................12
PREMIUMS ............................................................12
ALLOCATION OF PREMIUMS...............................................13
TRANSFERS............................................................13
HOW THE CONTRACT FUND CHANGES WITH INVESTMENT EXPERIENCE.............14
HOW A CONTRACT'S DEATH BENEFIT WILL VARY.............................14
CONTRACT LOANS.......................................................14
SURRENDER OF A CONTRACT..............................................15
LAPSE AND REINSTATEMENT..............................................15
Fixed Extended Term Insurance...............................16
Fixed Reduced Paid-Up Insurance.............................16
Variable Reduced Paid-Up Insurance..........................16
What Happens If No Request Is Made?.........................16
PAID-UP INSURANCE OPTION.............................................16
WHEN PROCEEDS ARE PAID...............................................17
LIVING NEEDS BENEFIT.................................................17
Terminal Illness Option.....................................17
Nursing Home Option.........................................17
VOTING RIGHTS........................................................18
REPORTS TO CONTRACT OWNERS...........................................18
TAX TREATMENT OF CONTRACT BENEFITS...................................18
Treatment as Life Insurance.................................18
Pre-Death Distributions.....................................19
Other Tax Consequences......................................19
OTHER CONTRACT PROVISIONS............................................19

FURTHER INFORMATION ABOUT THE SERIES FUND.....................................19

<PAGE>

Page

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS..........................20
BALANCED PORTFOLIOS..................................................20
CONSERVATIVE BALANCED PORTFOLIO.............................20
FLEXIBLE MANAGED PORTFOLIO..................................21
FOREIGN SECURITIES...................................................22
OPTIONS, FUTURES CONTRACTS AND SWAPS.................................22
SHORT SALES..........................................................23
REPURCHASE AGREEMENTS................................................23
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS.......................23
LOANS OF PORTFOLIO SECURITIES........................................24

INVESTMENT RESTRICTIONS APPLICABLE TO THE PORTFOLIOS..........................24

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................24
PORTFOLIO BROKERAGE AND RELATED PRACTICES............................24

STATE REGULATION..............................................................25

EXPERTS .....................................................................25

LITIGATION....................................................................25

EXPANDED TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION.............25

ADDITIONAL INFORMATION........................................................27

FINANCIAL STATEMENTS..........................................................27

FINANCIAL STATEMENTS OF THE PRUCO LIFE PRUvider
VARIABLE APPRECIABLE ACCOUNT.........................................A1

CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE
INSURANCE COMPANY AND SUBSIDIARIES...................................B1

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS AND THE PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION FOR
THE SERIES FUND.
<PAGE>

INTRODUCTION AND SUMMARY

This section provides only an overview of the more significant provisions of the
Contract. It omits details which are provided in the rest of this prospectus, as
well as in a Statement of Additional Information which is available to you upon
request without charge. A description of the contents of that Statement of
Additional Information is on page 25.

As you read this prospectus you should keep in mind that you are considering the
purchase of a life insurance contract. Because it is VARIABLE LIFE INSURANCE -
and variable life insurance has significant investment aspects and requires you
to make investment decisions - it is also a "security." That is why you have
been given this prospectus. Securities which are offered to the public must be
registered with the Securities and Exchange Commission, and the prospectus that
is a part of the registration statement must be given to all prospective buyers.
But because a substantial part of your premium pays for life insurance that will
pay to your beneficiary, in the event of your death, an amount far exceeding
your total premium payments, you should not buy this contract unless a major
reason for the purchase is to provide life insurance protection. Because the
contract provides whole-life or permanent insurance, it also serves a second
important objective. It can be expected to provide an increasing cash surrender
value that can be used during your lifetime.

BRIEF DESCRIPTION OF THE CONTRACT

The PRUVIDER Variable APPRECIABLE LIFE Contract (referred to from now on as the
"Contract") is issued and sold by the Pruco Life Insurance Company ("Pruco
Life"), a stock life insurance company, organized in 1971 under the laws of the
State of Arizona. It is licensed to sell life insurance and annuities in the
District of Columbia, Guam, and in all states except New York. These Contracts
are not offered in any state in which the necessary approvals have not yet been
obtained.

Pruco Life is a wholly-owned subsidiary of Prudential, a mutual insurance
company founded in 1875 under the laws of the State of New Jersey. As of
December 31, 1996, Prudential has invested over $XXX million in Pruco Life in
connection with Pruco Life's organization and operation. Prudential intends from
time to time to make additional capital contributions to Pruco Life as needed to
enable it to meet its reserve requirements and expenses in connection with its
business. Prudential is under no obligation to make such contributions and its
assets do not back the benefits payable under the Contract. Pruco Life's
consolidated financial statements begin on page B1 and should be considered only
as bearing upon Pruco Life's ability to meet its obligations under the
Contracts.

The Contract is a form of flexible premium variable life insurance. It is built
around a Contract Fund, the amount of which changes every business day. That
amount represents the value of your Contract on that day although you will have
to pay a surrender charge if you decide to surrender the Contract during the
first ten Contract years.

A broad objective of the Contract is to provide benefits that will increase in
value if favorable investment results are achieved. Pruco Life has established a
separate account, like a separate division within the Company, called the Pruco
Life PRUVIDER Variable Appreciable Account. Whenever you pay a premium, Pruco
Life first deducts certain charges (described below) and, unless you decide
otherwise puts the remainder - often called the "net premium" - into the
Account, where it is combined with the net premiums from all other contracts
like this one. The money in the Account, including your Contract Fund, is then
invested in the following way. The Account is divided into 2 subaccounts and you
must decide which one[s] will hold the assets of your Contract Fund. The money
allocated to each subaccount is immediately invested in a corresponding
portfolio of The Prudential Series Fund, Inc. Those two portfolios -- called the
CONSERVATIVE BALANCED PORTFOLIO and the FLEXIBLE MANAGED PORTFOLIO -- differ in
the amount of risk associated with them and are described in more detail below.

Because the assets that relate to the Contract may be invested in these variable
investment options, the Contract offers an opportunity for your cash surrender
value to appreciate more rapidly than it would under comparable fixed-benefit
whole-life insurance. You, however, must accept the risk that if investment
performance is unfavorable the cash surrender value may not appreciate as
rapidly and, indeed, may decrease in value. If you prefer to avoid this risk you
may elect to allocate part or all of the net premiums in a fixed-rate option
under which a stated interest rate is credited to the amount of your Contract
Fund allocated to that option. See the FIXED-RATE OPTION, page 8.

Pruco Life deducts certain charges from each premium payment and from the
amounts held in the designated investment options. In addition, Pruco Life makes
certain additional charges if a Contract lapses or is surrendered during the
first 10 Contract years. All these charges, which are largely designed to cover
insurance costs and risks as well as sales and administrative expenses, are
fully described under CONTRACT FEES AND CHARGES on page 9. In brief, and subject
to that fuller description, the following diagram outlines the charges which may
be made:

1
<PAGE>

----------------------------------------------------
PREMIUM PAYMENT
----------------------------------------------------

o less charge for taxes
attributable to premiums
o less $2 processing fee
----------------------------------------

- --------------------------------------------------------------------------------
INVESTED PREMIUM AMOUNT

o To be invested in one or a combination of:
o The Conservative Balanced Portfolio
o The Flexible Managed Portfolio

o The Fixed-Rate Option

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

- --------------------------------------------------------------------------------
DAILY CHARGES

o A daily charge equivalent to an annual rate of up to 0.9% is deducted from
the assets of the subaccounts for mortality and expense risks.
o Management fees and expenses are deducted from the assets of the Series
Fund. See DEDUCTIONS FROM PORTFOLIOS, page 9.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
MONTHLY CHARGES

o A sales charge is deducted from the Contract Fund in the amount of1/2of 1%
of the primary annual premium.
o The Contract Fund is reduced by a guaranteed minimum death benefit risk
charge of not more than $0.01 per $1,000 of the face amount of insurance.
o The Contract Fund is reduced by an administrative charge of up to $6 per
Contract and up to $0.19 per $1,000 of face amount of insurance (currently,
on a non-guaranteed basis, the $0.19 charge is decreased to $0.09 per
$1,000); if the face amount of the Contract is less than $10,000, there is
an additional charge of $0.30 per $1,000 of face amount.
o A charge for anticipated mortality is deducted, with the maximum charge
based on the non-smoker/smoker 1980 CSO Tables.
o If the Contract includes riders, a deduction from the Contract Fund will be
made for charges applicable to those riders; a deduction will also be made
if the rating class of the insured results in an extra charge.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
POSSIBLE ADDITIONAL CHARGES

o If the Contract lapses or is surrendered during the first 10 years, a
contingent deferred sales charge is assessed; the maximum contingent
deferred sales charge during the first 5 years is 50% of the first year's
primary annual premium but this charge is both subject to other important
limitations and reduced for Contracts that have been in force for more than
5 years.
o If the Contract lapses or is surrendered during the first 10 years, a
contingent deferred administrative charge is assessed; during the first 5
years, this charge equals $5 per $1,000 of face amount and it begins to
decline uniformly after the fifth Contract year so that it disappears on
the tenth Contract anniversary.
o An administrative processing charge of $15 will be made in connection with
each withdrawal of excess cash surrender value.
- --------------------------------------------------------------------------------

Because of the charges listed above, and in particular because of the
significant charges deducted upon early surrender or lapse, you should purchase
a Contract only if you intend and have the financial capability to keep it in
force for a substantial period.

When you first buy the Contract you give instructions to Pruco Life as to what
combination of the three investment options you wish your Contract Fund
invested. Thereafter you may make changes in these allocations either in writing
or by telephone. The investment objectives of the portfolios, described more
fully starting on page 20 of this prospectus, and of the fixed-rate option are
as follows:

2
<PAGE>

BALANCED PORTFOLIOS

CONSERVATIVE BALANCED PORTFOLIO. Achievement of a favorable total investment
return consistent with a portfolio having a conservatively managed mix of money
market instruments, fixed income securities, and common stocks, in proportions
believed by the investment manager to be appropriate for an investor who desires
diversification of investment who prefers a relatively lower risk of loss than
that associated with the Flexible Managed Portfolio while recognizing that this
reduces the chances of greater appreciation.

FLEXIBLE MANAGED PORTFOLIO. Achievement of a high total investment return
consistent with a portfolio having an aggressively managed mix of money market
instruments, fixed income securities, and common stocks, in proportions believed
by the investment manager to be appropriate for an investor desiring
diversification of investment who is willing to accept a relatively high level
of loss in an effort to achieve greater appreciation.

FIXED-RATE OPTION

Guarantee against loss of principal plus income at a rate which may change at
yearly intervals, but will never be lower than an effective annual rate of 4%.

TRANSFERS BETWEEN INVESTMENT OPTIONS

You may at any time change the instructions for the allocation of your premiums
to the various investment options. You may also transfer amounts held in one
option to another. There are restrictions upon transfers out of the fixed-rate
option which under certain circumstances Pruco Life may waive.

THE SCHEDULED PREMIUM

Your Contract sets forth an annual Scheduled Premium, or one that is payable
more frequently, such as monthly. Pruco Life guarantees that, if the Scheduled
Premiums are paid when due (or if missed premiums are paid later, with
interest), the death benefit will be paid upon the death of the insured. The
Contract will not lapse even if investment experience is unexpectedly so
unfavorable that the Contract Fund value drops to below zero.

The amount of the scheduled premium depends on the Contract's face amount, the
insured's sex (except where unisex rates apply) and age at issue, the insured's
risk classification, the rate for taxes attributable to premiums, and the
frequency of premium payments selected. Under certain low face amount Contracts
issued on younger insureds, the payment of the Scheduled Premium may cause the
Contract to be classified as a Modified Endowment Contract. See TAX TREATMENT OF
CONTRACT BENEFITS, page 18. The scheduled premium will not be increased (except
to reflect changes in the rate for taxes attributable to premiums). See
PREMIUMS, page 12.

PAYMENT OF HIGHER PREMIUMS

The payment of premiums in excess of Scheduled Premiums may cause the Contract
to be classified as a Modified Endowment Contract. See PREMIUMS, page 12 and TAX
TREATMENT OF CONTRACT BENEFITS, page 18.

CONTRACT LOANS

The Contract permits the owner to borrow up to 90% of the amount of the cash
surrender value (100% of the portion allocated to the fixed-rate option) on
favorable terms. See CONTRACT LOANS, page 14. When a loan is made, the amount
held under the investment options described above is reduced, proportionately,
by the amount of the loan.

PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACTS

Pruco Life's PRUVIDER Variable APPRECIABLE LIFE Insurance Contract is a form of
life insurance that provides much of the flexibility of variable universal life.
However, it differs in two important ways. First, Pruco Life guarantees that if
the Scheduled Premiums are paid when due or within the grace period (or missed
premiums are paid later with interest), the Contract will not lapse and the face
amount of insurance will be paid upon the death of the insured even if, because
of unfavorable investment experience, the Contract Fund value should drop to
below zero. Second, if all premiums are not paid when due (or made up), the
Contract will not lapse as long as the Contract Fund is higher than a stated
amount set forth in a table in the Contract - an amount that increases each year
and in later years becomes quite high; it is called the "Tabular Contract Fund."
The Contract lapses when the Contract Fund falls to below this stated amount,
rather than when it drops to zero. Thus, when a PRUVIDER Variable APPRECIABLE
LIFE Contract lapses, it may still have considerable value and you will,
therefore, have a substantial incentive to reinstate it, as well as an
opportunity to make a considered decision whether to do so or to take, in one
form or another, the cash surrender value. In effect, Pruco Life provides an
early and timely warning against the imprudent use of the flexibility provided
by the Contract.

3
<PAGE>

In the following pages of this prospectus we describe in much greater detail all
of the provisions of the Contract. That description is preceded by two sets of
tables. The first set provides, in condensed form, financial information about
the portfolios of the Series Fund, beginning on the date each of them was first
established. The second set shows what the cash surrender values and death
benefits would be under a Contract issued on a hypothetical person, making
certain assumptions. These tables show generally how the values under the
Contract would vary, with different investment performances.

FINANCIAL HIGHLIGHTS OF THE PORTFOLIOS OF
THE SERIES FUND

The tables that follow provide information about the annual investment income,
capital appreciation and expenses of the 2 available portfolios of the Series
Fund for each year, beginning with the year after the Series Fund was
established. They are prepared on a per share basis and therefore provide useful
information about the investment performance of each portfolio.

NOTE, HOWEVER, THAT THESE TABLES DO NOT TELL YOU HOW YOUR CONTRACT FUND WOULD
HAVE CHANGED DURING THIS PERIOD BECAUSE THEY DO NOT REFLECT THE DEDUCTIONS FROM
THE CONTRACT FUND OTHER THAN THE PORTFOLIO DEDUCTIONS.

4
<PAGE>

THE PRUDENTIAL SERIES FUND, INC. FINANCIAL HIGHLIGHTS

TO BE FILED BY POST-EFFECTIVE AMENDMENT PURSUANT TO RULE 485(b)

5
<PAGE>

PORTFOLIO RATES OF RETURN

TO BE FILED BY POST-EFFECTIVE AMENDMENT PURSUANT TO RULE 485(b)

6
<PAGE>

Illustrations of Cash Surrender Values, Death Benefits
and Accumulated Premiums

The following tables have been prepared to help show how values under the
Contract change with investment performance of the Account. The tables assume
that no portion of the Contract Fund is allocated to the fixed-rate option. The
tables illustrate how cash surrender values (reflecting the deduction of
deferred sales load and administrative charges, if any) and death benefits of
Contracts issued on an insured of a given age would vary over time if the gross
investment return on the assets held in the selected Series Fund portfolios were
a uniform, after tax, annual rate of 0%, 4%, 8%, and 12% and minimum scheduled
premiums were paid. The death benefits and cash surrender values would be
different from those shown if the returns averaged 0%, 4%, 8%, and 12% but
fluctuated over and under those averages throughout the years.

The death benefits and cash surrender values shown in the first two tables on
pages T1 and T2 reflect Pruco Life's current charges. The values shown in these
tables are calculated upon the assumption that Pruco Life will continue to use
the administrative charges and mortality rates that it is currently using, even
though it is permitted under the Contract to use higher administrative charges
and the higher mortality charges specified in the 1980 CSO Table. While Pruco
Life does not currently intend to withdraw or modify these reductions in
charges, it reserves the right to do so.

The death benefits and cash surrender values shown in the next two tables on
pages T3 and T4 are calculated upon the assumption that the maximum
administrative charges allowable under the Contract and the maximum mortality
charges specified by the 1980 CSO Table are made throughout the life of the
Contract; they do not reflect Pruco Life's current practice of reducing the
administrative and mortality charges.

The amounts shown for the death benefit and cash surrender value as of each
Contract year reflect the fact that the net investment return on the assets held
in the subaccounts is lower than the gross, after-tax return of the Series
Fund's portfolios. This is because these tables assume an investment management
fee and other estimated Series Fund expenses totaling 0.62% and also reflect the
daily charge to the Account for assuming mortality and expense risks, which is
equivalent to an effective annual rate of 0.9%. The 0.62% figure is based on an
average of the current management fees of the two available portfolios and an
analysis of historical operating expenses other than management fees, taking
into account any applicable expense offsets. Actual fees and expenses of the
portfolios associated with a Contract may be more or less than 0.62%, will vary
from year to year, and will depend on how the Contract Fund is allocated. Based
on the above assumptions, gross annual rates of return of 0%, 4%, 8%, and 12%
correspond in the tables to approximate net annual rates of return of -1.52%,
2.48%, 6.48%, and 10.48%, respectively. The tables reflect the fact that no
charges for federal or state income taxes are currently made against the Account
(other than "taxes attributable to premiums"). If such a charge is made in the
future, it will take higher gross rates of return to produce the same net
after-tax returns. The tables assume that the insured is in the preferred rating
class, and the charge for federal, state and local taxes attributable to
premiums is 3.25%.

Upon request, Pruco Life will furnish a comparable hypothetical illustration
based on the proposed insured's age and sex (except where unisex rates apply)
and on the face amount or premium amount requested. The illustrations can be
prepared upon the assumptions that the insured is in the preferred or standard
rating class or in a different risk classification, and can assume that annual,
semi-annual, quarterly or monthly premiums are paid.

7
<PAGE>

ILLUSTRATIONS

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

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35

$5,000 GUARANTEED DEATH BENEFIT
$173.70 ANNUAL PREMIUM (1)
USING CURRENT CONTRACTUAL CHARGES

Death Benefit (2)
----------------------------------------------------
Assuming Hypothetical Gross (and Net)
Premiums Annual Investment Return of
End of Accumulated ----------------------------------------------------
Policy at 4% Interest 0% Gross 4% Gross 8% Gross 12% Gross
Year Per Year (-1.52% Net) (2.48% Net) (6.48% Net) (10.48% Net)
------ -------------- ------------ ----------- ----------- ------------

1 $ 181 $5,003 $5,007 $ 5,011 $ 5,016
2 $ 369 $5,002 $5,013 $ 5,024 $ 5,036
3 $ 564 $5,000 $5,019 $ 5,040 $ 5,063
4 $ 767 $5,000 $5,024 $ 5,058 $ 5,096
5 $ 978 $5,000 $5,028 $ 5,079 $ 5,136
6 $ 1,198 $5,000 $5,033 $ 5,104 $ 5,186
7 $ 1,427 $5,000 $5,038 $ 5,133 $ 5,247
8 $ 1,665 $5,000 $5,042 $ 5,166 $ 5,318
9 $ 1,912 $5,000 $5,046 $ 5,204 $ 5,403
10 $ 2,169 $5,000 $5,049 $ 5,246 $ 5,501
15 $ 3,617 $5,000 $5,055 $ 5,539 $ 6,264
20 $ 5,379 $5,000 $5,042 $ 6,017 $ 9,081
25 $ 7,523 $5,000 $5,007 $ 6,949 $13,482
30 (Age 65) $10,132 $5,000 $5,000 $ 8,696 $19,488
35 $13,305 $5,000 $5,000 $10,646 $27,770
40 $17,166 $5,000 $5,000 $12,868 $39,313
45 $21,864 $5,000 $5,000 $15,463 $55,611

Cash Surrender Value (2)
----------------------------------------------------
Assuming Hypothetical Gross (and Net)
Annual Investment Return of
End of ----------------------------------------------------
Policy 0% Gross 4% Gross 8% Gross 12% Gross
Year (-1.52% Net) (2.48% Net) (6.48% Net) (10.48% Net)
------ ------------ ----------- ----------- ------------

1 $ 0 $ 0 $ 2 $ 6
2 $ 48 $ 59 $ 70 $ 82
3 $101 $ 121 $ 142 $ 165
4 $153 $ 185 $ 219 $ 256
5 $204 $ 249 $ 300 $ 357
6 $268 $ 329 $ 400 $ 482
7 $330 $ 410 $ 506 $ 619
8 $392 $ 493 $ 617 $ 769
9 $452 $ 577 $ 735 $ 934
10 $510 $ 662 $ 859 $ 1,114
15 $718 $1,044 $ 1,528 $ 2,253
20 $879 $1,452 $ 2,427 $ 4,105
25 $965 $1,873 $ 3,625 $ 7,034
30 (Age 65) $934 $2,290 $ 5,171 $11,589
35 $691 $2,674 $ 7,108 $18,540
40 $ 41 $2,983 $ 9,482 $28,970
45 $ 0 $3,125 $12,331 $44,348

(1) If premiums are paid more frequently than annually, the payments would be
$89.46 semi-annually, $46.15 quarterly or $16.90 monthly. The death
benefits and cash surrender values would be slightly different for a
Contract with more frequent premium payments.

(2) Assumes no Contract loan has been made.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A
REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF
RETURN MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF
FACTORS INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING
INTEREST RATES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUCO LIFE OR THE SERIES FUND THAT THESE
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.

T1
<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$20,000 GUARANTEED DEATH BENEFIT
$390.90 ANNUAL PREMIUM (1)
USING CURRENT CONTRACTUAL CHARGES

1 $ 407 $20,012 $20,024 $20,036 $ 20,048
2 $ 829 $20,013 $20,046 $20,080 $ 20,115
3 $ 1,269 $20,001 $20,065 $20,132 $ 20,204
4 $ 1,726 $20,000 $20,081 $20,194 $ 20,316
5 $ 2,202 $20,000 $20,094 $20,265 $ 20,455
6 $ 2,697 $20,000 $20,111 $20,355 $ 20,634
7 $ 3,211 $20,000 $20,125 $20,458 $ 20,850
8 $ 3,746 $20,000 $20,138 $20,576 $ 21,106
9 $ 4,302 $20,000 $20,148 $20,710 $ 21,410
10 $ 4,881 $20,000 $20,156 $20,861 $ 21,765
15 $ 8,140 $20,000 $20,153 $21,933 $ 24,565
20 $12,106 $20,000 $20,071 $23,703 $ 34,368
25 $16,931 $20,000 $20,000 $26,728 $ 51,066
30 (Age 65) $22,801 $20,000 $20,000 $33,481 $ 73,847
35 $29,942 $20,000 $20,000 $41,021 $105,266
40 $38,631 $20,000 $20,000 $49,613 $149,051
45 $49,203 $20,000 $20,000 $59,648 $210,877

1 $ 38 $ 50 $ 62 $ 74
2 $ 243 $ 276 $ 310 $ 345
3 $ 441 $ 505 $ 572 $ 644
4 $ 635 $ 739 $ 851 $ 973
5 $ 832 $ 985 $ 1,155 $ 1,346
6 $1,082 $ 1,294 $ 1,538 $ 1,818
7 $1,333 $ 1,615 $ 1,947 $ 2,339
8 $1,580 $ 1,941 $ 2,379 $ 2,909
9 $1,821 $ 2,272 $ 2,834 $ 3,534
10 $2,056 $ 2,608 $ 3,313 $ 4,217
15 $2,893 $ 4,108 $ 5,887 $ 8,520
20 $3,536 $ 5,709 $ 9,341 $ 15,537
25 $3,882 $ 7,357 $13,944 $ 26,641
30 (Age 65) $3,750 $ 8,976 $19,911 $ 43,915
35 $2,769 $10,425 $27,387 $ 70,280
40 $ 140 $11,484 $36,561 $109,838
45 $ 0 $11,674 $47,568 $168,168

(1) If premiums are paid more frequently than annually, the payments would be
$202.79 semi-annually, $103.98 quarterly or $36.59 monthly. The death
benefits and cash surrender values would be slightly different for a
Contract with more frequent premium payments.

(2) Assumes no Contract loan has been made.

T2
<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$5,000 GUARANTEED DEATH BENEFIT
$173.70 ANNUAL PREMIUM (1)
USING MAXIMUM CONTRACTUAL CHARGES

1 $ 181 $5,000 $5,000 $ 5,004 $ 5,009
2 $ 369 $5,000 $5,000 $ 5,010 $ 5,022
3 $ 564 $5,000 $5,000 $ 5,018 $ 5,039
4 $ 767 $5,000 $5,000 $ 5,028 $ 5,063
5 $ 978 $5,000 $5,000 $ 5,039 $ 5,092
6 $ 1,198 $5,000 $5,000 $ 5,053 $ 5,129
7 $ 1,427 $5,000 $5,000 $ 5,070 $ 5,173
8 $ 1,665 $5,000 $5,000 $ 5,089 $ 5,227
9 $ 1,912 $5,000 $5,000 $ 5,111 $ 5,290
10 $ 2,169 $5,000 $5,000 $ 5,136 $ 5,364
15 $ 3,617 $5,000 $5,000 $ 5,316 $ 5,948
20 $ 5,379 $5,000 $5,000 $ 5,619 $ 7,671
25 $ 7,523 $5,000 $5,000 $ 6,094 $11,185
30 (Age 65) $10,132 $5,000 $5,000 $ 6,978 $15,837
35 $13,305 $5,000 $5,000 $ 8,391 $22,060
40 $17,166 $5,000 $5,000 $ 9,931 $30,451
45 $21,864 $5,000 $5,000 $11,640 $41,854

1 $ 0 $ 0 $ 0 $ 0
2 $ 35 $ 45 $ 56 $ 67
3 $ 82 $ 100 $ 120 $ 142
4 $128 $ 157 $ 189 $ 224
5 $172 $ 214 $ 261 $ 314
6 $228 $ 284 $ 349 $ 425
7 $283 $ 355 $ 442 $ 546
8 $336 $ 427 $ 540 $ 677
9 $388 $ 500 $ 642 $ 821
10 $438 $ 573 $ 749 $ 977
15 $601 $ 885 $1,305 $ 1,936
20 $711 $1,200 $2,029 $ 3,468
25 $738 $1,495 $2,960 $ 5,835
30 (Age 65) $630 $1,732 $4,150 $ 9,418
35 $278 $1,834 $5,602 $14,728
40 $ 0 $1,641 $7,318 $22,439
45 $ 0 $ 713 $9,283 $33,377

(2) Assumes no Contract loan has been made.

<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$20,000 GUARANTEED DEATH BENEFIT
$390.90 ANNUAL PREMIUM (1)
USING MAXIMUM CONTRACTUAL CHARGES

1 $ 407 $20,000 $20,000 $20,009 $ 20,020
2 $ 829 $20,000 $20,000 $20,024 $ 20,056
3 $ 1,269 $20,000 $20,000 $20,045 $ 20,110
4 $ 1,726 $20,000 $20,000 $20,073 $ 20,185
5 $ 2,202 $20,000 $20,000 $20,108 $ 20,282
6 $ 2,697 $20,000 $20,000 $20,152 $ 20,406
7 $ 3,211 $20,000 $20,000 $20,205 $ 20,558
8 $ 3,746 $20,000 $20,000 $20,268 $ 20,742
9 $ 4,302 $20,000 $20,000 $20,341 $ 20,963
10 $ 4,881 $20,000 $20,000 $20,426 $ 21,225
15 $ 8,140 $20,000 $20,000 $21,056 $ 23,325
20 $12,106 $20,000 $20,000 $22,139 $ 28,833
25 $16,931 $20,000 $20,000 $23,868 $ 42,092
30 (Age 65) $22,801 $20,000 $20,000 $26,688 $ 59,647
35 $29,942 $20,000 $20,000 $32,133 $ 83,129
40 $38,631 $20,000 $20,000 $38,071 $114,786
45 $49,203 $20,000 $20,000 $44,659 $157,809

1 $ 12 $ 24 $ 35 $ 46
2 $ 190 $ 221 $ 253 $ 286
3 $ 364 $ 422 $ 485 $ 551
4 $ 532 $ 627 $ 730 $ 842
5 $ 704 $ 843 $ 999 $ 1,173
6 $ 923 $1,115 $ 1,336 $ 1,589
7 $1,143 $1,396 $ 1,695 $ 2,047
8 $1,358 $1,680 $ 2,071 $ 2,545
9 $1,566 $1,967 $ 2,465 $ 3,087
10 $1,768 $2,255 $ 2,878 $ 3,677
15 $2,427 $3,477 $ 5,010 $ 7,280
20 $2,870 $4,707 $ 7,777 $ 13,035
25 $2,979 $5,844 $11,330 $ 21,959
30 (Age 65) $2,546 $6,726 $15,871 $ 35,471
35 $1,129 $7,031 $21,453 $ 55,500
40 $ 0 $6,070 $28,055 $ 84,587
45 $ 0 $1,945 $35,614 $125,848

(2) Assumes no Contract loan has been made.

<PAGE>

GENERAL INFORMATION ABOUT
PRUCO LIFE PRUVIDER VARIABLE APPRECIABLE ACCOUNT
AND THE FIXED RATE OPTION

PRUCO LIFE PRUVIDER VARIABLE APPRECIABLE ACCOUNT

Pruco Life PRUVIDER Variable Appreciable Account was established on July 10,
1992 under Arizona law as a separate investment account. The Account meets the
definition of a "separate account" under the federal securities laws. The
Account holds assets that are segregated from all of Pruco Life's other assets.

The obligations to Contract owners and beneficiaries arising under the Contract
are general corporate obligations of Pruco Life. Pruco Life is also the legal
owner of the assets in the Account. Pruco Life will maintain assets in the
Account with a total market value at least equal to the reserve and other
liabilities relating to the variable benefits attributable to the Account. These
assets may not be charged with liabilities which arise from any other business
Pruco Life conducts. In addition to these assets, the Account's assets may
include funds contributed by Pruco Life to commence operation of the Account and
may include accumulations of the charges Pruco Life makes against the Account.
From time to time these additional assets will be transferred to Pruco Life's
general account. Before making any such transfer, Pruco Life will consider any
possible adverse impact the transfer might have on the Account.

The Account is registered with the Securities and Exchange Commission ("SEC")
under the Investment Company Act of 1940 ("1940 Act") as a unit investment
trust, which is a type of investment company. This does not involve any
supervision by the SEC of the management or investment policies or practices of
the Account. For state law purposes, the Account is treated as a part or
division of Pruco Life. There are currently two subaccounts within the Account,
one of which invests in the Conservative Balanced Portfolio and the other of
which invests in the Flexible Managed Portfolio of the Series Fund. Additional
subaccounts may be added in the future. The Account's financial statements begin
on page A1.

THE FIXED-RATE OPTION

Because of exemptive and exclusionary provisions, interests in the fixed-rate
option under the Contract have not been registered under the Securities Act of
1933 and the general account has not been registered as an investment company
under the Investment Company Act of 1940. Accordingly, interests in the
fixed-rate option are not subject to the provisions of these Acts, and Pruco
Life has been advised that the staff of the Securities and Exchange Commission
has not reviewed the disclosure in this Prospectus relating to the fixed-rate
option. Any inaccurate or misleading disclosure regarding the fixed-rate option
may, however, subject Pruco Life and its directors to civil liability if that
results in any damage.

As explained earlier, you may elect to allocate, either initially or by
transfer, all or part of the amount credited under the Contract to the
fixed-rate option, and the amount so allocated or transferred becomes part of
The Pruco Life's general assets. Sometimes this is referred to as Pruco Life's
general account, which consists of all assets owned by Pruco Life other than
those in the Account and in other separate accounts that have been or may be
established by Pruco Life. Subject to applicable law, Pruco Life has sole
discretion over the investment of the assets of the general account, and
Contract owners do not share in the investment experience of those assets.
Instead, Pruco Life guarantees that the part of the Contract Fund allocated to
the fixed-rate option will accrue interest daily at an effective annual rate
that Pruco Life declares periodically. This rate may not be less than an
effective annual rate of 4%. Currently, declared interest rates remain in effect
from the date money is allocated to the fixed-rate option until the Monthly date
in the same month in the following year. See CONTRACT DATE, page 12. Thereafter,
a new crediting rate will be declared each year and will remain in effect for
the calendar year. Pruco Life reserves the right to change this practice. Pruco
Life is not obligated to credit interest at a higher rate than 4%, although in
its sole discretion it may do so. Different crediting rates may be declared for
different portions of the Contract Fund allocated to the fixed-rate option. At
least annually and on request, a Contract owner will be advised of the interest
rates that currently apply to his or her Contract.

Transfers from the fixed-rate option are subject to strict limits. (See
TRANSFERS, page 13). The payment of any cash surrender value attributable to the
fixed-rate option may be delayed up to 6 months (see WHEN PROCEEDS ARE PAID,
page 17).

8
<PAGE>

DETAILED INFORMATION FOR PROSPECTIVE
CONTRACT OWNERS

REQUIREMENTS FOR ISSUANCE OF A CONTRACT

Generally, the minimum initial guaranteed death benefit that can be applied for
is $5,000 and the maximum that can be applied for is $25,000. For proposed
insureds 21 years of age or younger, the minimum initial guaranteed death
benefit that can be applied for is $10,000. The Contract may generally be issued
on insureds below the age of 76. Before issuing any Contract, Pruco Life
requires evidence of insurability which may include a medical examination.
Non-smokers who meet preferred underwriting requirements are offered the most
favorable premium rate. A higher premium is charged if an extra mortality risk
is involved. These are the current underwriting requirements. The Company
reserves the right to change these requirements on a non-discriminatory basis.

SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"

Generally, you may return the Contract for a refund within 10 days after you
receive it, within 45 days after Part I of the application for insurance is
signed, or within 10 days after Pruco Life mails or delivers a Notice of
Withdrawal Right, whichever is latest. Some states allow a longer period of time
during which a Contract may be returned for a refund. A refund can be requested
by mailing or delivering the Contract to the representative who sold it or to
the Home Office specified in the Contract. A Contract returned according to this
provision shall be deemed void from the beginning. You will then receive a
refund of all premium payments made, plus or minus any change due to investment
experience. However, if applicable law so requires, if you exercise your
short-term cancellation right, you will receive a refund of all premium payments
made, with no adjustment for investment experience.

CONTRACT FEES AND CHARGES

This section provides a detailed description of each charge that is described
briefly in the chart on page 2, and an explanation of the purpose of the charge.

In several instances we will use the terms "maximum charge" and "current
charge." The "maximum charge," in each instance, will be the highest charge that
Pruco Life is entitled to make under the Contract. The "current charge" is the
lower amount that Pruco Life is now charging. However, if circumstances change,
Pruco Life reserves the right to increase each current charge, up to but to no
more than the maximum charge, without giving any advance notice.

A Contract owner may add several "riders" to the Contract which provide
additional benefits, which are charged for separately. The statement and
description of charges that follows assumes there are no riders to the Contract.

Deductions from Premiums

(a) A charge for taxes attributable to premiums is deducted from each premium.
That charge is currently made up of two parts. The first part is in an amount
equal to the state or local premium tax. It varies from jurisdiction to
jurisdiction and generally ranges from 0.75% to 5% (but in some instances it may
exceed 5%) of the premium received by Pruco Life. The second part is for federal
income taxes measured by premiums and it is equal to 1.25% of the premium. Pruco
Life believes that this charge is a reasonable estimate of an increase in its
federal income taxes resulting from a 1990 change in the Internal Revenue Code.
It is intended to recover this increased tax. During 1996 and 1995, Pruco Life
received a total of approximately $XXX and $2,003,387, respectively, in taxes
attributable to premiums.

(b) A charge of $2 is deducted from each premium payment to cover the cost of
collecting and processing premiums. Thus, if you pay premiums annually, this
charge will be $2 per year. If you pay premiums monthly, the charge will be $24
per year. If you pay premiums more frequently, for example under a payroll
deduction plan with your employer, the charge may be more than $24 per year.
During 1996 and 1995, Pruco Life received a total of approximately $XXX and
$965,634, respectively, in processing charges.

Deductions from Portfolios

(a) An investment advisory fee is deducted daily from each portfolio at an
annual rate of 0.55% for the Conservative Balanced Portfolio and 0.6% for the
Flexible Managed Portfolio.

(b) The expenses incurred in conducting the investment operations of the
portfolios (such as investment advisory fees, custodian fees and preparation and
distribution of annual reports) are paid out of the portfolio's income. These
expenses also vary from portfolio to portfolio. The total expenses of each
portfolio for the year 1996 expressed as a percentage of the average assets
during the year are shown as follows:

9
<PAGE>

- --------------------------------------------------------------------------------
PORTFOLIO ADVISORY OTHER TOTAL
FEE EXPENSES EXPENSES
- --------------------------------------------------------------------------------
Conservative Balanced 0.55% 0.04% 0.59%
Flexible Managed 0.60% 0.04% 0.64%
- --------------------------------------------------------------------------------

For the years 1996, 1995, and 1994, Prudential received a total of $XXX,
$77,610,207, and $66,413,206, respectively, in investment management fees for
all of the Series Fund's portfolios.

MONTHLY DEDUCTIONS FROM CONTRACT FUND

The following monthly charges are deducted proportionately from the dollar
amounts held in each of the chosen investment option[s].

(a) A sales charge, often called a sales load, is deducted to pay part of the
costs Pruco Life incurs in selling the Contracts, including commissions,
advertising and the printing and distribution of prospectuses and sales
literature. The charge is equal to 0.5% of the "primary annual premium" which is
equal to the Scheduled Premium that would be payable if premiums were being paid
annually, less the two deductions from premiums (taxes attributable to premiums
and the $2 processing charge), and less the $6 part of the monthly deduction
described in (c) below, the $0.30 per $1,000 of face amount for Contracts with a
face amount of less than $10,000, and any extra premiums for riders or
substandard risks. The deduction is made whether the Contract owner is paying
premiums annually or more frequently. It is lower on Contracts issued on
insureds over 60 years of age. To summarize, this charge is somewhat less than
(significantly less for Contracts with small face amounts) 6% of the annual
Scheduled Premium.

There is a second sales load, which will be charged only if a Contract lapses or
is surrendered before the end of the 10th Contract year. It is often described
as a contingent deferred sales load ("CDSL") and is described later under
SURRENDER OR WITHDRAWAL CHARGES. During 1996 and 1995, Pruco Life received a
total of approximately $XXX and $3,035,533, respectively, in sales load charges.

(b) A charge of not more than $0.01 per $1000 of face amount of insurance is
made to compensate Pruco Life for the risk it assumes by guaranteeing that, no
matter how unfavorable investment experience may be, the death benefit will
never be less than the guaranteed minimum death benefit so long as Scheduled
Premiums are paid on or before the due date or during the grace period. This
charge will not be made if the Contract has been continued in force pursuant to
an option on lapse. During 1996 and 1995, Pruco Life received a total of
approximately $XXX and $120,813, respectively, for this risk charge.

(c) An administrative charge of $6 plus up to $0.19 per $1,000 per month of face
amount of insurance is deducted each month. Currently, on a non-guaranteed
basis, this charge is reduced from $0.19 to $0.09 per $1,000. The charge is
intended to pay for processing claims, keeping records, and communicating with
Contract owners. If premiums are paid by automatic transfer under the Pru-Matic
Plan, as described on page 12, the current charge is further reduced to $0.07
per $1,000 of face amount. There is an additional charge of $0.30 per $1,000 of
face amount if the face amount of the Contract is less than $10,000. This
monthly administrative charge will not be made if the Contract has been
continued in force pursuant to an option on lapse. During 1996 and 1995, Pruco
Life received a total of approximately $XXX and $6,876,677, respectively, in
monthly administrative charges.

(d) A mortality charge is deducted that is intended to be used to pay death
benefits. When an insured dies, the amount payable to the beneficiary is larger
than the Contract Fund and significantly larger if the insured dies in the early
years of a Contract. The mortality charges collected from all Contract owners
enables Pruco Life to pay the death benefit for the few insureds who die. The
maximum mortality charge is determined by multiplying the "net amount at risk"
under a Contract (the amount by which the Contract's death benefit, computed as
if there were neither riders nor Contract debt, exceeds the Contract Fund) by a
rate based upon the insured's current attained age and sex (except where unisex
rates apply) and the anticipated mortality for that class of persons. The
anticipated mortality is based upon mortality tables published by The National
Association of Insurance Commissioners called the Non-Smoker/Smoker 1980 CSO
Tables. Pruco Life may determine that a lesser amount than that called for by
these mortality tables will be adequate for insureds of particular ages and may
thus make a lower mortality charge for such persons. Any lower current mortality
charges are not applicable to Contracts in force pursuant to an option on lapse.
See LAPSE AND REINSTATEMENT, page 15.

(e) If the Contract includes riders, Pruco Life deducts any charges applicable
to those riders from the Contract Fund on each Monthly date. In addition, Pruco
Life will deduct on each Monthly date any extra charge incurred because of the
rating class of the insured.

10
<PAGE>

(f) A charge may be deducted to cover federal, state or local taxes (other than
"taxes attributable to premiums" described above) that are imposed upon the
operations of the Account. At present no such taxes are imposed and no charge is
made. Pruco Life will review the question of a charge to the Account for company
federal income taxes periodically. Such a charge may be made in future years for
any company federal income taxes that would be attributable to the Account.

Under current law, Pruco Life may incur state and local taxes (in addition to
premium taxes) in several states. At present, these taxes are not significant
and they are not charged against the Account. If there is a material change in
the applicable state or local tax laws, the imposition of any such taxes upon
Pruco Life that are attributable to the Account may result in a corresponding
charge against the Account.

Daily Deduction from the Contract Fund

Each day a charge is deducted from the assets of each of the subaccounts in an
amount equivalent to an effective annual rate of up to 0.9%. This charge is
intended to compensate Pruco Life for assuming mortality and expense risks under
the Contract. The mortality risk assumed is that insureds may live for shorter
periods of time than Pruco Life estimated when it determined what mortality
charge to make. The expense risk assumed is that expenses incurred in issuing
and administering the Contract will be greater than Pruco Life estimated in
fixing its administrative charges. This charge is not assessed against amounts
allocated to the fixed-rate option. During 1996 and 1995, Pruco Life received a
total of approximately $XXX and $976,867, respectively, in mortality and expense
risk charges.

Surrender or Withdrawal Charges

(a) An additional sales load (the CDSL) is charged if a Contract is surrendered
for its cash surrender value or lapses during the first 10 Contract years. It is
not deducted from the death benefit if the insured should die during this
period. This maximum contingent deferred charge is equal to 50% of the first
year's primary annual premium upon Contracts that lapse during the first 5
Contract years. That percentage is reduced uniformly on a daily basis starting
from the Contract's fifth anniversary until it disappears on the tenth
anniversary. Other important limitations apply. They are described more fully in
the Statement of Additional Information. The amount of this charge can be more
easily understood by reference to the following table which shows the sales
loads that would be paid by a 35 year old man with $20,000 face amount of
insurance, both through the monthly deductions from the Contract Fund described
above and upon the surrender of the Contract.

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
CUMULATIVE
CUMULATIVE TOTAL SALES
SALES LOAD LOAD AS PER-
SURRENDER, CUMULATIVE DEDUCTED CONTINGENT CENTAGE OF
LAST DAY SCHEDULED FROM DEFERRED TOTAL SCHEDULED
OF PREMIUMS CONTRACT SALES SALES PREMIUMS
YEAR NO. PAID FUND LOAD LOAD PAID
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 $ 390.90 $ 18.24 $ 87.22 $ 105.46 26.98%
2 781.80 36.48 104.16 140.64 17.99%
3 1,172.70 54.72 121.10 175.82 14.99%
4 1,563.60 72.96 138.04 211.00 13.49%
5 1,954.50 91.20 146.55 237.75 12.16%
6 2,345.40 109.44 121.80 231.24 9.86%
7 2,736.30 127.68 91.40 219.08 8.01%
8 3,127.20 145.92 60.80 206.72 6.61%
9 3,518.10 164.16 30.40 194.56 5.53%
10 3,909.00 182.40 0.00 182.40 4.67%
- --------------------------------------------------------------------------------------------------
</TABLE>

The percentages shown in the last column will not be appreciably different for
insureds of different ages.

(b) An administrative charge of $5 per $1,000 of face amount of insurance is
deducted upon lapse or surrender to cover the cost of processing applications,
conducting medical examinations, determining insurability and the insured's
rating class, and establishing records. However, this charge is reduced
beginning on the Contract's fifth anniversary and declines daily at a constant
rate until it disappears entirely on the tenth Contract anniversary. We are
currently allowing partial surrenders of the Contract, but we reserve the right
to cancel this administrative practice. If the Contract is partially surrendered
during the first 10 years, a proportionate amount of the charge will be deducted
from the Contract Fund. During 1996 and 1995, Pruco Life received a total of
approximately $XXX and $219,895, respectively, for surrendered or lapsed
Contracts.

11
<PAGE>

Transaction Charges

An administrative processing charge of $15 will be made in connection with each
withdrawal of excess cash surrender value of a Contract. This charge is
described in more detail in the Statement of Additional Information.

CONTRACT DATE

When the first premium payment is paid with the application for a Contract, the
Contract date will ordinarily be the later of the date of the application or the
date of any medical examination. In most cases no medical examination will be
necessary. If the first premium is not paid with the application, the Contract
date will ordinarily be the date the first premium was paid and the Contract was
delivered. Under certain circumstances, Pruco Life will permit a Contract to be
back-dated but only to a date not earlier than 6 months prior to the date of the
application. It may be advantageous for a Contract owner to have an earlier
Contract date since that will result in the use by Pruco Life of a lower issue
age in determining the amount of the scheduled premium. Pruco Life will require
the payment of all premiums that would have been due had the application date
coincided with the back-dated Contract date. The death benefit and cash
surrender value under the Contract will be equal to what they would have been
had the Contract been issued on the Contract date, all scheduled premiums been
received on their due dates, and all Contract charges been made.

PREMIUMS

The Contract provides for a Scheduled Premium which, if paid when due or within
a 61 day grace period, ensures that the Contract will not lapse. If you pay
premiums other than on a monthly basis, you will receive a notice that a premium
is due about 3 weeks before each due date. If you pay premiums monthly, you will
receive a book each year with 12 coupons that will serve as a reminder. With
Pruco Life's consent, you may change the frequency of premium payments.

You may elect to have monthly premiums paid automatically under the "Pru-Matic
Premium Plan" by pre-authorized transfers from a bank checking account. If you
select the Pru-Matic Premium Plan, one of the current monthly charges will be
reduced. See MONTHLY DEDUCTIONS FROM CONTRACT FUND, page 10. Some Contract
owners may also be eligible to have monthly premiums paid by pre-authorized
deductions from an employer's payroll.

The following table shows, for two face amounts, representative preferred and
standard annual premium amounts under Contracts issued on insureds who are not
substandard risks. These premiums do not reflect any additional riders or
supplementary benefits.

- --------------------------------------------------------------------------------
$10,000 FACE AMOUNT $20,000 FACE AMOUNT
- --------------------------------------------------------------------------------
PREFERRED STANDARD PREFERRED STANDARD
- --------------------------------------------------------------------------------
Male, age 35 $233.70 $274.01 $390.90 $ 471.52
at issue
- --------------------------------------------------------------------------------
Female, age 45 $278.04 $308.53 $479.59 $ 540.57
at issue
- --------------------------------------------------------------------------------
Male, age 55 $450.96 $562.17 $825.43 $1047.86
at issue
- --------------------------------------------------------------------------------

The following table compares annual and monthly premiums for insureds who are in
the preferred rating class. Note that in these examples the sum of 12 monthly
premiums for a particular Contract is approximately 110% to 116% of the annual
scheduled premium for that Contract.

- --------------------------------------------------------------------------------
$10,000 FACE AMOUNT $20,000 FACE AMOUNT
- --------------------------------------------------------------------------------
MONTHLY ANNUAL MONTHLY ANNUAL
- --------------------------------------------------------------------------------
Male, age 35 $22.43 $233.70 $36.59 $390.90
at issue
- --------------------------------------------------------------------------------
Female, age 45 $26.46 $278.04 $44.65 $479.59
at issue
- --------------------------------------------------------------------------------
Male, age 55 $41.96 $450.96 $75.66 $825.43
at issue
- --------------------------------------------------------------------------------

12
<PAGE>

A significant feature of this Contract is that it permits you to pay greater
than Scheduled Premiums. This may be done by making occasional unscheduled
premium payments or on a periodic basis. If you wish, you may select a higher
contemplated premium than the Scheduled Premium. Pruco Life will then bill you
for the chosen premium. In general, the regular payment of higher premiums will
result in higher cash surrender values and higher death benefits. Conversely,
payment of a Scheduled Premium need not be made if the Contract Fund is
sufficiently large to enable the charges due under the Contract to be made
without causing the Contract to lapse. See LAPSE AND REINSTATEMENT, page 15. The
payment of premiums in excess of Scheduled Premiums may cause the Contract to
become a Modified Endowment Contract. If this happens, loans and other
distributions which would otherwise not be taxable events will be subject to
federal income taxation. See TAX TREATMENT OF CONTRACT BENEFITS, page 18.

Pruco Life will generally accept any premium payment if the payment is at least
$25. Pruco Life does reserve the right, however, to limit unscheduled premiums
to a total of $5,000 in any Contract year, and to refuse to accept premiums that
would immediately result in more than a dollar-for-dollar increase in the death
benefit. See HOW A CONTRACT'S DEATH BENEFIT WILL VARY, page 14. The privilege of
making large or additional premium payments offers a way of investing amounts
which accumulate without current income taxation, but again, there are tax
consequences if the Contract becomes a Modified Endowment Contract. See TAX
TREATMENT OF CONTRACT BENEFITS, page 18.

ALLOCATION OF PREMIUMS

On the Contract date, a $2 processing charge and the charge for taxes
attributable to premiums are deducted from the initial premium. The remainder is
allocated on the Contract date among the subaccount[s] or the fixed-rate option
according to the desired allocation specified in the application form. From this
invested portion of the initial premium, the first monthly deductions are made.
See CONTRACT FEES AND CHARGES, page 9. The invested portion of any part of the
initial premium in excess of the Scheduled Premium is placed in the selected
investment option[s] on the date of receipt, but not earlier than the Contract
date. Thus, to the extent that the receipt of the first premium precedes the
Contract date, there will be a period during which the Contract owner's initial
premium will not be invested. All subsequent premium payments, after the
deduction from premiums, when received by Pruco Life will be placed in the
subaccount[s] or the fixed-rate option in accordance with the allocation
previously designated. Provided the Contract is not in default, you may change
the way in which subsequent premiums are allocated by giving written notice to a
Home Office. You may also change the way in which subsequent premiums are
allocated by telephoning the Home Office, provided you are enrolled to use the
Telephone Transfer system. There is no charge for reallocating future premiums.
If any part of the invested portion of a premium is allocated to a particular
investment option, that portion must be at least 10% on the date the allocation
takes effect. All percentage allocations must be in whole numbers. For example,
33% can be selected but 331/3% cannot. Of course, the total allocation of all
selected investment options must equal 100%.

TRANSFERS

If the Contract is not in default, or if the Contract is in force as variable
reduced paid-up insurance (see LAPSE AND REINSTATEMENT, page 15), you may, up to
four times in each Contract year, transfer amounts from one subaccount to the
other subaccount or to the fixed-rate option. Currently you may make additional
transfers with Pruco Life's consent. There is no charge. All or a portion of the
amount credited to a subaccount may be transferred.

In addition, the total amount credited to a Contract held in the subaccounts may
be transferred to the fixed-rate option at any time during the first two
Contract years. If you wish to convert your variable Contract to a fixed-benefit
Contract in this manner, you must request a complete transfer of funds to the
fixed-rate option and should also change your allocation instructions regarding
any future premiums.

Transfers between subaccounts will take effect as of the end of the valuation
period (usually the business day) in which a proper transfer request is received
at a Home Office. The valuation period is defined as the period of time from one
determination of the value of the amount invested in a subaccount to the next.
Such determinations are made when the net asset values of the portfolios are
calculated, which is generally at 4:15 p.m. New York City time on each day
during which the New York Stock Exchange is open. The request may be in terms of
dollars, such as a request to transfer $1,000 from one subaccount to the other,
or may be in terms of a percentage reallocation between subaccounts. In the
latter case, as with premium reallocations, the percentages must be in whole
numbers. You may transfer amounts by proper written notice to a Home Office or
by telephone, provided you are enrolled to use the Telephone Transfer System.
You will automatically be enrolled to use the Telephone Transfer System unless
the Contract is jointly owned or you elect not to have this privilege. Telephone
transfers may not be available on policies that are assigned, depending on the
terms of the assignment. Pruco Life has adopted procedures designed to ensure
that requests by telephone are genuine and will require appropriate
identification for that purpose. Pruco Life will not be held liable for
following telephone instructions that we reasonably believe to be genuine. Pruco
Life cannot guarantee that you will be able to get through to complete a
telephone transfer during peak periods such as periods of drastic economic or
market change.

13
<PAGE>

Transfers from the fixed-rate option are subject to restrictions and may only be
made with Pruco Life's consent. Transfers from the fixed-rate option to the
subaccounts are currently permitted once each Contract year and only during the
30-day period beginning on the Contract anniversary. The maximum amount which
may be transferred out of the fixed-rate option each year is currently the
greater of: (a) 25% of the amount in the fixed-rate option, or (b) $2,000. Such
transfer requests received prior to the Contract anniversary will be effected on
the Contract anniversary. Transfer requests received within the 30-day period
beginning on the Contract anniversary will be effected as of the end of the
valuation period in which a proper transfer request is received at a Home
Office.
These limits are subject to change in the future.

HOW THE CONTRACT FUND CHANGES WITH INVESTMENT EXPERIENCE

As previously stated, after the tenth Contract year, there will no longer be a
surrender charge and, if there is no Contract loan, the cash surrender value
will be equal to the Contract Fund. This section, therefore, also describes how
the cash surrender value of the Contract will change with investment experience.

On the Contract Date, the Contract Fund value is the initial premium less the
deductions from premiums and the first monthly deductions. See CONTRACT FEES AND
CHARGES, page 9. This amount is placed in the investment options designated by
the owner. Thereafter the Contract Fund value changes daily, reflecting
increases or decreases in the value of the securities in which the assets of the
subaccount have been invested, and interest credited on any amounts allocated to
the fixed-rate option. It is also reduced by the daily asset charge for
mortality and expense risks assessed against the variable investment options.
The Contract Fund value also increases to reflect the receipt of additional
premium payments and is decreased by the monthly deductions.

A Contract's cash surrender value on any date will be the Contract Fund value
reduced by the withdrawal charges, if any, and by any Contract debt. Upon
request, Pruco Life will tell a Contract owner the cash surrender value of his
or her Contract. It is possible, although highly unlikely, that the cash
surrender value of a Contract could decline to zero because of unfavorable
investment performance, even if a Contract owner continues to pay Scheduled
Premiums when due.

The tables on pages T1 through T4 of this prospectus illustrate what the death
benefit and cash surrender values would be for a representative Contract,
assuming uniform hypothetical investment results in the selected portfolio[s],
and also provide information about the aggregate premiums payable under the
Contract.

HOW A CONTRACT'S DEATH BENEFIT WILL VARY

The death benefit will change from the outset with investment experience. The
precise way in which that will occur is complicated and is described in the
Statement of Additional Information. In general, and assuming the optional
paid-up benefit is not in effect, see PAID-UP INSURANCE OPTION, on page 16, if
the net investment performance is 4% per year or higher, the death benefit will
increase; if it is below 4%, it will decrease. Pruco Life guarantees, however,
that it will not decrease below the face amount of insurance. If unfavorable
experience of that kind should occur, it must be offset by favorable experience
before the death benefit begins to increase again.

If the Contract is kept in force for several years and if investment performance
is relatively favorable, the Contract Fund value may grow to the point where, to
meet certain provisions of the Internal Revenue Code which require that the
death benefit always be greater than the Contract Fund value, the death benefit
must be increased. The required difference between the death benefit and
Contract Fund value is higher at younger ages than at older ages. A precise
description is in the Statement of Additional Information.

CONTRACT LOANS

The owner may borrow from Pruco Life up to the "loan value" of the Contract,
using the Contract as the only security for the loan. The loan value is equal to
(1) 90% of an amount equal to the portion of the Contract Fund value
attributable to the variable investment options and to any prior loan[s]
supported by the variable investment options, minus the portion of any charges
attributable to variable investment options that would be payable upon an
immediate surrender; plus (2) 100% of an amount equal to the portion of the
Contract Fund value attributable to the fixed-rate option and to any prior
loan[s] supported by the fixed-rate option, minus the portion of any charges
attributable to the fixed-rate option that would be payable upon an immediate
surrender. The minimum amount that may be borrowed at any one time is $200
unless the proceeds are used to pay premiums on the Contract.

14
<PAGE>

may repay all or enough of the loan to obtain a positive cash surrender value
and thus keep the Contract in force for a limited time. If you fail to keep the
Contract in force, the amount of unpaid Contract debt will be treated as a
distribution which may be taxable. See TAX TREATMENT OF CONTRACT BENEFITS, page
18, and LAPSE AND REINSTATEMENT, page 15.

When a loan is made, an amount equal to the loan proceeds will be transferred
out of the variable investment options and/or the fixed-rate option, as
applicable. The reduction will normally be made in the same proportions as the
value in each subaccount and the fixed-rate option bears to the total value of
the Contract. While a loan is outstanding, the amount that was so transferred
will continue to be treated as part of the Contract Fund but it will be credited
with the assumed rate of return of 4% rather than with the actual rate of return
of the subaccount[s] or fixed-rate option.

A loan will not affect the amount of the premiums due. Should the death benefit
become payable while a loan is outstanding, or should the Contract be
surrendered, any Contract debt will be deducted from the death benefit or the
cash surrender value.

A loan will have an effect on a Contract's cash surrender value and may have an
effect on the death benefit, even if the loan is fully repaid, because the
investment results of the selected investment options will apply only to the
amount remaining invested under those options. The longer the loan is
outstanding, the greater the effect is likely to be. The effect could be
favorable or unfavorable. If investment results are greater than the rate being
credited upon the amount of the loan while the loan is outstanding, values under
the Contract will not increase as rapidly as they would have if no loan had been
made. If investment results are below that rate, Contract values will be higher
than they would have been had no loan been made. A loan that is repaid will not
have any effect upon the guaranteed minimum death benefit.

Consider the Contract issued on a 35 year old male insured illustrated in the
table on page T2 with an 8% gross investment return. Assume a $1,500 loan was
made under this Contract at the end of Contract year 8 and repaid at the end of
Contract year 10 and loan interest was paid when due. Upon repayment, the cash
surrender value would be $3,237.44. This amount is lower than the cash surrender
value shown on that page for the end of Contract year 10 because the loan amount
was credited with the 4% assumed rate of return rather than the 6.48% net return
for the designated subaccount[s] resulting from the 8% gross return in the
underlying Series Fund. Loans from Modified Endowment Contracts may be treated
for tax purposes as distributions of income. See TAX TREATMENT OF CONTRACT
BENEFITS, page 18.

SURRENDER OF A CONTRACT

You may surrender a Contract for its cash surrender value while the insured is
living. To surrender a Contract, you must deliver or mail it, together with a
written request in a form that meets our needs, to a Home Office. The cash
surrender value of a surrendered Contract (taking into account the deferred
sales and administrative charges, if any) will be determined as of the end of
the valuation period in which such a request is received in the Home Office. We
are currently allowing partial surrenders of Contracts, but we reserve the right
to cancel this administrative practice. Surrender of a Contract may have tax
consequences. See TAX TREATMENT OF CONTRACT BENEFITS, page 18.

LAPSE AND REINSTATEMENT

If Scheduled Premiums are paid on or before each due date, or within the grace
period after each due date, and there are no withdrawals, a Contract will remain
in force even if the investment results of that Contract's variable investment
option[s] have been so unfavorable that the Contract Fund has decreased to zero
or less.

In addition, even if a Scheduled Premium is not paid, the Contract will remain
in force as long as the Contract Fund on any Monthly Date is equal to or greater
than the Tabular Contract Fund value on the following Monthly Date. (A Table of
Tabular Contract Fund Values is included in the Contract; the values increase
with each year the Contract remains in force.) This could occur because of such
factors as favorable investment experience, deduction of current rather than
maximum charges, or the previous payment of greater than Scheduled Premiums.

However, if a Scheduled Premium is not paid, and the Contract Fund is
insufficient to keep the Contract in force, the Contract will go into default.
Should this happen, Pruco Life will send you a notice of default setting forth
the payment necessary to keep the Contract in force on a premium paying basis.
This payment must be received at a Home Office within the 61 day grace period
after the notice of default is mailed or the Contract will lapse. A Contract
that lapses with an outstanding Contract loan may have tax consequences. See TAX
TREATMENT OF CONTRACT BENEFITS, page 18.

A Contract that has lapsed may be reinstated within 5 years after the date of
default unless the Contract has been surrendered for its cash surrender value.
To reinstate a lapsed Contract, Pruco Life requires renewed evidence of
insurability, and submission of certain payments due under the Contract.

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<PAGE>

If your Contract does lapse, it will still provide some benefits. You can
receive the cash surrender value by making a request of Pruco Life prior to the
end of the 61 day grace period. You may also choose one of the three forms of
insurance described below for which no further premiums are payable.

Fixed Extended Term Insurance. The amount of insurance that would have been paid
on the date of default will continue for a stated period of time. You will be
told in writing how long that will be. The insurance amount will not change.
There will be a diminishing cash surrender value but no loan value. Extended
term insurance is not available to insureds in high risk classifications or
under Contracts issued in connection with tax-qualified pension plans.

Fixed Reduced Paid-Up Insurance. This insurance continues for the lifetime of
the insured but at an insurance amount that is generally lower than that
provided by fixed extended term insurance. It will decrease only if a Contract
loan is taken. You will be told, if you ask, what the amount of the insurance
will be. Fixed paid-up insurance has a cash surrender value and a loan value. It
is possible for this Contract to be classified as a Modified Endowment Contract
if this option is exercised during the first 7 Contract years. See TAX TREATMENT
OF CONTRACT BENEFITS, page 18.

Variable Reduced Paid-Up Insurance. This is similar to fixed paid-up insurance
and will initially be in the same amount. The Contract Fund will continue to
vary to reflect the experience of the selected investment options. There will be
a new guaranteed minimum death benefit. Variable reduced paid-up insurance has
cash surrender and loan values.

Variable reduced paid-up insurance is the automatic option provided upon lapse,
if the amount of variable reduced paid-up insurance is at least as great as the
amount of fixed extended term insurance which would have been provided upon
lapse. Variable reduced paid-up insurance will be available only if the insured
is not in one of the high risk rating classes for which Pruco Life does not
offer fixed extended term insurance. It is possible for this Contract to be
classified as a Modified Endowment Contract if this option is exercised during
the first 7 Contract years. See TAX TREATMENT OF CONTRACT BENEFITS, page 18.

What Happens If No Request Is Made? Except in the two situations described
below, if no request is made the "automatic option" will be fixed extended term
insurance. If that is not available to the insured, then fixed reduced paid-up
insurance will be provided. However, if variable reduced paid-up insurance is
available and the amount is at least as great as the amount of fixed extended
term insurance, then the automatic option will be variable reduced paid-up
insurance. This could occur when there is a Contract debt outstanding when the
Contract lapses.

PAID-UP INSURANCE OPTION

In certain circumstances you may elect to stop paying premiums and to have
guaranteed insurance coverage for the lifetime of the insured. This benefit is
available only if the following conditions are met: (1) the Contract is not in
default; (2) Pruco Life is not paying premiums in accordance with any payment of
premium benefit that may be included in the Contract; and (3) the Contract Fund
is sufficiently large so that the calculated guaranteed paid-up insurance amount
is at least equal to the face amount of insurance plus the excess, if any, of
the Contract Fund over the tabular Contract Fund. The amount of guaranteed
paid-up insurance coverage may be greater. It will be equal to the difference
between the Contract Fund and the present value of future monthly charges from
the Contract Fund (other than charges for anticipated mortality costs and for
payment of premium riders) multiplied by the attained age factor. This option
will generally be available only when the Contract has been in force for many
years and the Contract Fund has grown because of favorable investment experience
or the payment of unscheduled premiums or both. Once the paid-up insurance
option is exercised, the actual death benefit is equal to the greater of the
guaranteed paid-up insurance amount and the Contract Fund multiplied by the
attained age factor. Upon request, Pruco Life will quote the amount needed to
pay up the Contract and to guarantee the paid-up insurance amount as long as a
payment equal to or greater than the quoted amount is received within two weeks
of the quote. There is no guarantee if the remittance is received within the two
week period and is less than the quoted amount or if the remittance is received
outside the two week period. In this case, Pruco Life will add the remittance to
the Contract Fund and recalculate the guaranteed paid-up insurance amount. If
the guaranteed paid-up insurance amount is equal to or greater than the face
amount, the paid-up request will be processed. If the guaranteed paid-up
insurance amount is calculated below the face amount, the insured will be
notified that the amount is insufficient to process the request. In some cases,
the quoted amount, if paid, would increase the death benefit by more than it
increases the Contract Fund. In these situations, underwriting might be required
to accept the premium payment and to process the paid-up request. Pruco Life
reserves the right to change this procedure in the future. After the first
Contract year, you must make a proper written request for the Contract to become
fully paid-up and send the Contract to a Home Office to be endorsed. If this
option is exercised during the first 7 Contract years, the Contract may be
classified as a "Modified Endowment Contract," see TAX TREATMENT OF CONTRACT
BENEFITS, page 18. A Contract in effect under a paid-up insurance option will
have cash surrender and loan values.

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<PAGE>

WHEN PROCEEDS ARE PAID

Pruco Life will generally pay any death benefit, cash surrender value, loan
proceeds or withdrawal within 7 days after receipt at a Home Office of all the
documents required for such a payment. Other than the death benefit, which is
determined as of the date of death, the amount will be determined as of the end
of the valuation period in which the necessary documents are received. However,
Pruco Life may delay payment of proceeds from the subaccount[s] and the variable
portion of the death benefit due under the Contract if the sale or valuation of
the Account's assets is not reasonably practicable because the New York Stock
Exchange is closed for other than a regular holiday or weekend, trading is
restricted by the SEC or the SEC declares that an emergency exists.

With respect to the amount of any cash surrender value allocated to the
fixed-rate option, and with respect to a Contract in force as fixed reduced
paid-up insurance or as extended term insurance, Pruco Life expects to pay the
cash surrender value promptly upon request. However, Pruco Life has the right to
delay payment of such cash surrender value for up to 6 months (or a shorter
period if required by applicable law). Pruco Life will pay interest of at least
3% a year if it delays such a payment for more than 30 days (or a shorter period
if required by applicable law).

LIVING NEEDS BENEFIT

Contract applicants may elect to add the LIVING NEEDS BENEFIT(SM) to their
Contracts at issue. The benefit may vary state-by-state. It can generally be
added only when the aggregate face amounts of the insured's eligible contracts
equal $50,000 or more. There is no charge for adding the benefit to the
Contract. However, an administrative charge (not to exceed $150) will be made at
the time the LIVING NEEDS BENEFIT is paid.

Subject to state regulatory approval, the LIVING NEEDS BENEFIT allows the
Contract owner to elect to receive an accelerated payment of all or part of the
Contract's death benefit, adjusted to reflect current value, at a time when
certain special needs exist. The adjusted death benefit will always be less than
the death benefit, but will generally be greater than the Contract's cash
surrender value. One or both of the following options may be available. A Pruco
Life representative should be consulted as to whether additional options may be
available.

Terminal Illness Option. This option is available if the insured is diagnosed as
terminally ill with a life expectancy of 6 months or less. When satisfactory
evidence is provided, Pruco Life will provide an accelerated payment of the
portion of the death benefit selected by the Contract owner as a LIVING NEEDS
BENEFIT. You may (1) elect to receive the benefit in a single sum or (2) receive
equal monthly payments for 6 months. If the insured dies before all the payments
have been made, the present value of the remaining payments will be paid to the
beneficiary designated in the LIVING NEEDS BENEFIT claim form in a single sum.

Nursing Home Option. This option is available after the insured has been
confined to an eligible nursing home for 6 months or more. When satisfactory
evidence is provided, including certification by a licensed physician, that the
insured is expected to remain in the nursing home until death, Pruco Life will
provide an accelerated payment of the portion of the death benefit selected by
the Contract owner as a LIVING NEEDS BENEFIT. You may (1) elect to receive the
benefit in a single sum or (2) receive equal monthly payments for a specified
number of years (not more than 10 nor less than 2), depending upon the age of
the insured. If the insured dies before all of the payments have been made, the
present value of the remaining payments will be paid to the beneficiary
designated in the LIVING NEEDS BENEFIT claim form in a single sum.

All or part of the Contract's death benefit may be accelerated under the LIVING
NEEDS BENEFIT. If the benefit is only partially accelerated, a death benefit of
at least $25,000 must remain under the Contract. Pruco Life reserves the right
to determine the minimum amount that may be accelerated.

No benefit will be payable if the Contract owner is required to elect it in
order to meet the claims of creditors or to obtain a government benefit. Pruco
Life can furnish details about the amount of LIVING NEEDS BENEFIT that is
available to an eligible Contract owner under a particular Contract, and the
adjusted premium payments that would be in effect if less than the entire death
benefit is accelerated.

The Contract owner should consider whether adding this settlement option is
appropriate in his or her given situation. Adding the Living Needs Benefit to
the Contract has no adverse consequences; however, electing to use it could.
With the exception of certain business-related policies, the recently enacted
Health Insurance Portability and Accountability Act of 1996 excludes from income
the LIVING NEEDS BENEFIT if the insured is terminally ill or chronically ill as
defined by the tax law (although the exclusion in the latter case may be
limited). Contract owners should consult a qualified tax advisor before electing
to receive this benefit. Receipt of a LIVING NEEDS BENEFIT payment may also
affect a Contract owner's eligibility for certain government benefits or
entitlements.

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VOTING RIGHTS

As stated above, all of the assets held in the subaccounts of the Account will
be invested in shares of the corresponding portfolios of the Series Fund. Pruco
Life is the legal owner of those shares and as such has the right to vote on any
matter voted on at Series Fund shareholders meetings. However, Pruco Life will,
as required by law, vote the shares of the Series Fund at any regular and
special shareholders meetings it is required to hold in accordance with voting
instructions received from Contract owners. The Series Fund will not hold annual
shareholders meetings when not required to do so under Maryland law or the
Investment Company Act of 1940. Series Fund shares for which no timely
instructions from Contract owners are received, and any shares attributable to
general account investments of Pruco Life will be voted in the same proportion
as shares in the respective portfolios for which instructions are received.

Matters on which Contract owners may give voting instructions including the
following: (1) election of the Board of Directors of the Series Fund; (2)
ratification of the independent accountant of the Series Fund; (3) approval of
the investment advisory agreement for a portfolio of the Series Fund
corresponding to the Contract owner's selected subaccount[s]; (4) any change in
the fundamental investment policy of a portfolio corresponding to the Contract
owner's selected subaccount[s]; and (5) any other matter requiring a vote of the
shareholders of the Series Fund. With respect to approval of the investment
advisory agreement or any change in a portfolio's fundamental investment policy,
Contract owners participating in such portfolios will vote separately on the
matter.

The number of shares in a portfolio for which you may give instructions is
determined by dividing the portion of your Contract Fund attributable to the
portfolio, by the value of one share of the portfolio. The number of votes for
which each Contract owner may give Pruco Life instructions will be determined as
of the record date chosen by the Board of Directors of the Series Fund. Pruco
Life will furnish Contract owners with proper forms and proxies to enable them
to give these instructions. Pruco Life reserves the right to modify the manner
in which the weight to be given voting instructions is calculated where such a
change is necessary to comply with current federal regulations or
interpretations of those regulations.

Pruco Life may, if required by state insurance regulations, disregard voting
instructions if such instructions would require shares to be voted so as to
cause a change in the sub-classification or investment objectives of one or more
of the Series Fund's portfolios, or to approve or disapprove an investment
advisory contract for the Series Fund. In addition, Pruco Life itself may
disregard voting instructions that would require changes in the investment
policy or investment advisor of one or more of the Series Fund's portfolios,
provided that Pruco Life reasonably disapproves such changes in accordance with
applicable federal regulations. If Pruco Life does disregard voting
instructions, it will advise Contract owners of that action and its reasons for
such action in the next annual or semi-annual report to Contract owners.

REPORTS TO CONTRACT OWNERS

Once each Contract year (except where the Contract is in force as fixed extended
term insurance or fixed reduced paid-up insurance), you will be sent a statement
that provides certain information pertinent to your own Contract. These
statements show all transactions during the year that affected the value of your
Contract Fund, including monthly changes attributable to investment experience.
That statement will also show the current death benefit, cash surrender value,
and loan values of your Contract. On request, you will be sent a current
statement in a form similar to that of the annual statement described above, but
Pruco Life may limit the number of such requests or impose a reasonable charge
if such requests are made too frequently.

You will also be sent annual and semi-annual reports of the Series Fund showing
the financial condition of the portfolios and the investments held in both.

TAX TREATMENT OF CONTRACT BENEFITS

The tax treatment of life insurance is complex and may change. Each prospective
purchaser is urged to consult a qualified tax advisor. The following discussion
is not intended as tax advice, and it is not a complete statement of what the
effect of federal income taxes will be under all circumstances. Rather, it
provides information about how Pruco Life believes the tax laws apply in the
most commonly occurring circumstances. A more technical discussion of what
follows is contained in the Statement of Additional Information.

Treatment as Life Insurance. Pruco Life believes that the Contract should
qualify as "life insurance" under the Internal Revenue Code. This means that:
(1) except as noted below, the Contract owner should not be taxed on any part of
the Contract Fund, including additions attributable to interest or appreciation
until amounts are distributed under the Contract; and (2) the death benefit
should be excludable from the gross income of the beneficiary under section
101(a) of the Code.

Although Pruco Life believes the Contract should qualify as "life insurance" for
federal tax purposes, there are uncertainties, particularly because the
Secretary of the Treasury has not yet issued permanent regulations that bear

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<PAGE>

on this question. Accordingly, we have reserved the right to make changes --
which will be applied uniformly to all Contract owners after advance written
notice -- that we deem necessary to insure that the Contract will continue to
qualify as life insurance.

Pre-Death Distributions. The tax treatment of any distribution received by an
owner prior to an insured's death will depend upon whether the Contract is
classified as a Modified Endowment Contract.

If the Contract is not classified as a Modified Endowment Contract, proceeds
received in the event of a lapse, surrender of the Contract, or withdrawal of
part of the cash surrender value will generally not be taxable unless the total
amount received exceeds the gross premiums paid less the untaxed portion of any
prior withdrawals. In certain limited circumstances, all or a portion of a
withdrawal during the first 15 contract years may be taxable even if total
withdrawals do not exceed total premiums paid to date. The proceeds of any loan
will be treated as indebtedness of the owner and will not be treated as taxable
income.

If the Contract is classified as a Modified Endowment Contract, pre-death
distributions, including loans and withdrawals (even those made during the 2
year period before the Contract became a Modified Endowment Contract), will be
taxed first as investment income to the extent of gain in the Contract, and then
as a return of the Contract owner's investment in the Contract. In addition,
pre-death distributions (including full surrenders) will be subject to a penalty
of 10% of the amount includible in income unless the amount is distributed on or
after the owner reaches age 59 1/2, on account of the owner's disability, or as
a life annuity.

A Contract may be classified as a Modified Endowment Contract under various
circumstances. For example, low face amount Contracts issued on younger insureds
may be classified as a Modified Endowment Contract even though the Contract
owner pays only the Scheduled Premiums or even less than the Scheduled Premiums.
Before purchasing such a Contract, you should understand the tax treatment of
pre-death distributions and consider the purpose for which the Contract is being
purchased. More generally, a Contract may be classified as a Modified Endowment
Contract if premiums in excess of Scheduled Premiums are paid or the face amount
of insurance is decreased during the first seven Contract years, or if the face
amount of insurance is increased or if a rider is added or removed from the
Contract. You should consult with your tax advisor before making any of these
policy changes.

Other Tax Consequences. There may be federal estate taxes and state and local
estate and inheritance taxes payable if either the owner or the insured dies.
The transfer or assignment of the Contract to a new owner may also have tax
consequences. The individual situation of each Contract owner or beneficiary
will be significant.

Withholding. The taxable portion of any amounts received under the Contract will
be subject to withholding to meet federal income tax obligations if the Contract
owner fails to elect that no taxes will be withheld or in certain other
circumstances.

OTHER CONTRACT PROVISIONS

There are several other Contract provisions that are of less significance to you
than those already described in detail either because they relate to options
that you may choose under the Contract but are not likely to exercise for
several years after you first purchase it or because they are of a routine
nature not likely to influence your decision to buy the Contract. These
provisions are summarized in the Expanded Table of Contents of the Statement of
Additional Information, page 25 and described in greater detail in the Statement
of Additional Information.

FURTHER INFORMATION ABOUT THE SERIES FUND

The Prudential Series Fund, Inc. (the "Series Fund") is a Maryland corporation
organized on November 15, 1982. It is registered under the Investment Company
Act of 1940 (the "1940 Act") as an open-end, diversified, management investment
company. This registration does not imply any supervision by the Securities and
Exchange Commission over the Series Fund's management or its investment policies
or practices.

The Series Fund is currently made up of fifteen separate portfolios, two of
which, the Conservative Balanced and Flexible Managed Portfolios are available
to Contract owners. Each portfolio is, for many purposes, in effect a separate
investment fund, and a separate class of capital stock is issued for each
portfolio. Each share of capital stock issued with respect to a portfolio has a
pro-rata interest in the assets of that portfolio and has no interest in the
assets of any other portfolio. Each portfolio bears its own liabilities and also
its proportionate share of the general liabilities of the Series Fund. In other
respects the Series Fund is treated as one entity. For example, the Series Fund
has only one Board of Directors and owners of the shares of each portfolio are
entitled to vote for members of the Board.

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<PAGE>

Shares in the Series Fund are currently sold and redeemed at the close of each
business day, at their net asset value, determined in the manner described in
the Statement of Additional Information, only to separate accounts of Prudential
and its subsidiaries. They may, in the future, be sold to other insurers to fund
benefits under variable life insurance and variable annuity contracts issued by
those companies.

Prudential is the investment advisor of the Series Fund. Prudential has entered
into a Service Agreement with its wholly-owned subsidiary The Prudential
Investment Corporation ("PIC"), which provides that PIC will furnish to
Prudential such services as Prudential may require in connection with the
performance of its obligations under an Investment Advisory Agreement with the
Series Fund. See INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES, page 24.

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

Each portfolio of the Series Fund has a different objective which it pursues
through separate investment policies as described below. Since each portfolio
has a different investment objective, each can be expected to have different
investment results and incur different market and financial risks. Those risks,
as explained above, are borne by the Contract owner. The Series Fund may in the
future establish other portfolios with different investment objectives.

The investment objectives of both portfolios available to PRUVIDER Contract
owners are set forth on page 3. For the sake of convenience, they are repeated
here, followed in each case by a brief description of the policies of both
portfolios. In some cases a fuller description of those policies is in the
Statement of Additional Information. There is no guarantee that any of these
objectives will be met.

BALANCED PORTFOLIOS

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 15% 35% 50%
Bonds and Money Market 25% 65% 70%

The bond portion of this portfolio will be invested primarily in securities with
maturities of 2 to 10 years and ratings at the time of purchase within the four
highest grades determined by Moody's, S&P, or a similar nationally-recognized
rating service or if unrated, of comparable quality in the opinion of the
portfolio manager. However, the portfolio may purchase below-investment grade
debt. A description of corporate bond ratings is contained in the Statement of
Additional Information. Because of their shorter maturities, the value of the
notes and bonds in this portfolio will be less sensitive to changes in interest
rates than the longer-term bonds likely to be held in the Flexible Managed
Portfolio. Thus, there will be less of a risk of loss of principal, but not as
much of a likelihood for greater appreciation in value. Up to 20% of the bond
portion of this portfolio may be invested in United States currency denominated
debt securities issued outside the United States by foreign or domestic issuers.
The stock portion of this portfolio will be invested primarily in the equity
securities of major, established corporations in sound financial condition that
appear to offer attractive prospects of a total return from dividends and
capital appreciation that is superior to broadly based stock indices. The
portfolio may also invest in preferred stock, including below investment grade
preferred stock. The money market portion of the portfolio will hold high

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<PAGE>

quality money market instruments of the kind held by the Money Market Portfolio.
Moreover, when conditions dictate a temporary defensive strategy or during
temporary periods of portfolio structuring and restructuring, the Conservative
Balanced Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio. See SECURITIES IN
WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST in the Statement of
Additional Information.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
briefly under OPTIONS, FUTURES CONTRACTS AND SWAPS and SHORT SALES beginning on
page 22, and in detail in the Statement of Additional Information.

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 25% 60% 100%
Bonds 0% 40% 75%
Money Market 0% 0% 75%

The bond component of this portfolio is expected under normal circumstances to
have a weighted average maturity of greater than 10 years. The values of bonds
with longer maturities are generally more sensitive to changes in interest rates
than those of shorter maturities. The bond portion of this portfolio will
primarily be invested in securities that have a rating at the time of purchase
within the four highest grades determined by Moody's, S&P, or a similar
nationally-recognized rating service. A description of corporate bond ratings is
contained in the Statement of Additional Information. However, up to 25% of the
bond component of this portfolio may be invested in securities having ratings at
the time of purchase of "BB", "Ba" or lower, or if not rated, of comparable
quality in the opinion of the portfolio manager, also known as high risk
securities. Up to 20% of the bond portion of this portfolio may be invested in
United States currency denominated debt securities issued outside the United
States by foreign or domestic issuers. The established company common stock
component of this portfolio will consist of the equity securities of major
corporations that are believed to be in sound financial condition. In selecting
stocks of smaller capitalization companies, the portfolio manager will
concentrate on companies with a capitalization below $5 billion that show above
average profitability (measured by return-on-equity, earnings, and dividend
growth rates) with modest price/earnings ratios. The individual equity
selections for this portfolio may tend to have more volatile market values than
the equity securities selected for the Equity Portfolio or the Conservative
Balanced Portfolio. The portfolio may also invest in preferred stock, including
below investment grade preferred stock. The money market portion of the
portfolio will hold high quality money market instruments of the kind held by
the Money Market Portfolio. Moreover, when conditions dictate a temporary
defensive strategy or during temporary periods of portfolio structuring and
restructuring, the Flexible Managed Portfolio may invest, without limit, in high
quality money market instruments of the kind held by the Money Market Portfolio.
See SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST in the
Statement of Additional Information.

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<PAGE>

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
briefly under OPTIONS, FUTURES CONTRACTS AND SWAPS AND SHORT SALES below, and in
detail in the Statement of Additional Information.

FOREIGN SECURITIES

The bond components of the Conservative Balanced and Flexible Managed Portfolios
may each invest up to 20% of their assets in United States currency denominated
debt securities issued outside the United States by foreign or domestic issuers.
To the extent permitted by applicable insurance law, the Conservative Balanced
and Flexible Managed Portfolios may invest up to 30% of their total assets in
debt and equity securities denominated in a foreign currency and issued by
foreign or domestic issuers. Securities issued outside the United States and not
publicly traded in the United States, as well as American Depository Receipts
("ADRs") and securities denominated in a foreign currency are referred to
collectively in this prospectus as "foreign securities."

Foreign securities involve risks of political and economic instability in the
country of the issuer, the difficulty of predicting international trade
patterns, the possibility of imposition of exchange controls and, in the case of
securities not denominated in United States currency, the risk of currency
fluctuations. Such securities may be subject to greater fluctuations in price
than domestic securities. Under certain market conditions, foreign securities
may be less liquid than domestic securities. In addition, there may be less
publicly available information about a foreign company than about a domestic
company. Foreign companies generally are subject to uniform accounting,
auditing, and financial reporting standards comparable to those applicable to
domestic companies. There is generally less government regulation of securities
exchanges, brokers, and listed companies abroad than in the United States, and,
with respect to certain foreign countries, there is a possibility of
expropriation, confiscatory taxation or diplomatic developments which could
affect investment in those countries. If the security is denominated in foreign
currency, it may be affected by changes in currency rates and in exchange
control regulations, and costs may be incurred in connection with conversions
between currencies. Finally, in the event of a default of any foreign debt
obligations, it may be more difficult for a portfolio to obtain or to enforce a
judgment against the issuers of such securities. See FORWARD FOREIGN CURRENCY
EXCHANGE CONTRACTS in the Statement of Additional Information.

OPTIONS, FUTURES CONTRACTS AND SWAPS

The description of the portfolios' investment policies also state whether they
will invest in what are sometimes called derivative securities. These include
options (which may be to buy or sell equity securities, debt securities, stock
indices, foreign currencies and stock index futures contracts); futures
contracts on interest bearing securities, stock and interest rate indices, and
foreign currencies; and interest rate swaps. These investments have

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<PAGE>

not in the past represented more than a very minor part of the investments of
any portfolio but may increase in the future.

A call option gives the owner the right to buy and a put option the right to
sell a designated security or index at a predetermined price for a given period
of time. They will be used primarily to hedge or minimize fluctuations in the
principal value of a portfolio or to generate additional income. They involve
risks which differ, depending upon the particular option. But they often offer
an attractive alternative to the purchase or sale of the related security.

Futures contracts represent a contractual obligation to buy or sell a designated
security or index within a stated period. They can be used as a hedge against or
to minimize fluctuations of a portfolio or as an efficient way of establishing
certain positions more quickly than direct purchase of the securities. They can
also be used to speculate, but this will not be done by any of the portfolios.
They involve risks of various kinds, all of which could result in losses rather
than in achieving the intended objective of any particular purchase.

Because options, futures and swaps are now used to such a limited extent, a full
description of these investments and the risks associated with them is in the
Statement of Additional Information.

SHORT SALES

The Conservative Balanced and Flexible Managed Portfolios may sell securities
they do not own in anticipation of a decline in the market value of those
securities ("short sales"). The portfolio will incur a loss as a result of the
short sale if the price of the security increases between the date of the short
sale and the date on which the portfolio replaces the borrowed security. The
portfolio will realize a gain if the security declines in price between those
dates. This result is the opposite of what one would expect from a cash purchase
of a long position in a security. The amount of any gain will be decreased, and
the amount of any loss will be increased, by the amount of any premium or
interest paid in connection with the short sale.

REPURCHASE AGREEMENTS

The portfolios may enter into repurchase agreements, subject to each portfolio's
investment limit in short-term debt obligations, whereby the seller of a
security agrees to repurchase that security from the portfolio at a mutually
agreed-upon time and price. The period of maturity is usually quite short,
possibly overnight or a few days, although it may extend over a number of
months. The resale price is in excess of the purchase price, reflecting an
agreed-upon rate of return effective for the period of time the portfolio's
money is invested in the repurchase agreement. The repurchase agreements will at
all times be fully collateralized in an amount at least equal to the resale
price. The instruments held as collateral are valued daily, and if the value of
the instruments declines, the portfolio will require additional collateral. If
the seller defaults and the value of the collateral securing the repurchase
agreement declines, the portfolio may incur a loss. Both portfolios participate
in a joint repurchase account pursuant to an order of the SEC. On a daily basis,
any uninvested cash balances of the portfolios may be aggregated and invested in
one or more repurchase agreements. Each portfolio participates in the income
earned or accrued in the joint account based on the percentage of its
investment.

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS

The fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may use reverse repurchase agreements and dollar rolls. The money
market portion of these portfolios may use reverse repurchase agreements.
Reverse repurchase agreements involve the sale of securities held by a portfolio
with an agreement by the portfolio to repurchase the same securities at an
agreed upon price and date. During the reverse repurchase period, the portfolio
often continues to receive principal and interest payments on the sold
securities. The terms of each agreement reflect a rate of interest for use of
the funds for the period, and thus these agreements have the characteristics of
borrowing by the portfolio. Dollar rolls involve sales by a portfolio of
securities for delivery in the current month with a simultaneous contract to
repurchase substantially similar securities (same type and coupon) from the same
party at an agreed upon price and date. During the roll period, the portfolio
forgoes principal and interest paid on the securities. A portfolio is
compensated by the difference between the current sales price and the forward
price for the future purchase (often referred to as the "drop") as well as by
the interest earned on the cash proceeds of the initial sale. A "covered roll"
is a specific type of dollar roll for which there is an offsetting cash position
or a cash equivalent security position which matures on or before the forward
settlement date of the dollar roll transaction. A portfolio will establish a
segregated account with its custodian in which it will maintain cash, U.S.
Government securities or other liquid unencumbered assets equal in value to its
obligations in respect of reverse repurchase agreements and dollar rolls.
Reverse repurchase agreements and dollar rolls involve the risk that the market
value of the securities retained by the portfolio may decline below the price of
the securities the portfolio has sold but is obligated to repurchase under the
agreement. In the event the buyer of securities under a reverse repurchase
agreement or dollar roll files for bankruptcy or becomes insolvent, the
portfolio's use of the proceeds of the agreement may be restricted pending a
determination by the other party, or

23
<PAGE>

its trustee or receiver, whether to enforce the portfolio's obligation to
repurchase the securities. No portfolio will obligate more than 30% of its net
assets in connection with reverse repurchase agreements and dollar rolls.

LOANS OF PORTFOLIO SECURITIES

Both of the portfolios may from time to time lend the securities they hold to
broker-dealers, provided that such loans are made pursuant to written agreements
and are continuously secured by collateral in the form of cash, U.S. Government
Securities or irrevocable standby letters of credit in an amount equal to at
least the market value at all times of the loaned securities plus the accrued
interest and dividends. During the time securities are on loan, the portfolio
will continue to receive the interest and dividends, or amounts equivalent
thereto, on the loaned securities, while receiving a fee from the borrower or
earning interest on the investment of the cash collateral.

There is a slight risk that the borrower may become insolvent, which might delay
carrying out a decision to sell the loaned security. This risk can be minimized
by careful selection of borrowers and requiring and monitoring the adequacy of
capital. No loans will be made to any broker affiliated with Prudential.

INVESTMENT RESTRICTIONS APPLICABLE TO
THE PORTFOLIOS

The Series Fund is subject to certain investment restrictions which are
fundamental to the operations of the Series Fund and may not be changed except
with the approval of a majority vote of the persons participating in the
affected portfolio.

The investments of the various portfolios are generally subject to certain
additional restrictions under state laws. In the event of future amendments to
the applicable New Jersey statutes, each portfolio will comply, without the
approval of the shareholders, with the statutory requirements as so modified.

A detailed discussion of investment restrictions applicable to the Series Fund
is in the Statement of Additional Information.

INVESTMENT MANAGEMENT ARRANGEMENTS AND
EXPENSES

The Series Fund has entered into an Investment Advisory Agreement with
Prudential under which Prudential will, subject to the direction of the Board of
Directors of the Series Fund, be responsible for the management of the Series
Fund, and provide investment advice and related services to each portfolio.
Prudential manages the assets that it owns as well as those of various separate
accounts established by Prudential and those held by other investment companies
for which it acts as investment advisor. Total assets under management as of
December 31, 1996 was over $XXX billion, which includes over $XXX billion owned
by Prudential and approximately $XXX billion of external assets under
Prudential's management.

Subject to Prudential's supervision, substantially all of the investment
advisory services provided to the Series Fund by Prudential with respect to the
Conservative Balanced and Flexible Managed Portfolios, are furnished by its
wholly-owned subsidiary, PIC, pursuant to the Service Agreement between
Prudential and PIC which provides that a portion of the fee received by
Prudential for providing investment advisory services will be paid to PIC. The
Conservative Balanced and Flexible Managed Portfolios are managed by PIC, using
a team of portfolio managers under the supervision of Mark Stumpp, Managing
Director, PIC. PIC is registered as an investment advisor under the Investment
Advisers Act of 1940.

For the year ended December 31, 1996, the Series Fund's total expenses were
0.XXX% of the average net assets of all of the Series Fund's portfolios. The
investment management fee for that period constituted 0.XXX% of the average net
assets. Further information about the investment management arrangements and the
expenses of the Series Fund is in the Statement of Additional Information.

PORTFOLIO BROKERAGE AND RELATED PRACTICES

Prudential is responsible for decisions to buy and sell securities for the
portfolios, the selection of brokers and dealers to effect the transactions, and
the negotiation of brokerage commissions, if any. Fixed income securities, as
well as equity securities traded in the over-the-counter market, are generally
traded on a "net" basis with dealers acting as principals for their own accounts
without a stated commission, although the price of the security usually includes
a profit to the dealer.

24
<PAGE>

STATE REGULATION

Pruco Life is subject to regulation and supervision by the Department of
Insurance of the State of Arizona, which periodically examines its operations
and financial condition. It is also subject to the insurance laws and
regulations of all jurisdictions in which it is authorized to do business.

Pruco Life is required to submit annual statements of its operations, including
financial statements, to the insurance departments of the various jurisdictions
in which it does business to determine solvency and compliance with local
insurance laws and regulations.

In addition to the annual statements referred to above, Pruco Life is required
to file with Arizona and other jurisdictions a separate statement with respect
to the operations of all its variable contract accounts, in a form promulgated
by the National Association of Insurance Commissioners.

EXPERTS

The financial statements included in this prospectus for the year ended December
31, 1996 have been audited by Price Waterhouse LLP, independent accountants, as
stated in their reports appearing herein, and are included in reliance upon the
reports of such firm given upon their authority as experts in accounting and
auditing. Price Waterhouse LLP's principal business address is 1177 Avenue of
the Americas, New York, New York 10036.

The financial statements included in this prospectus for the years prior to 1996
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their reports appearing herein, and are included in reliance upon the reports of
such firm given upon their authority as experts in accounting and auditing.
Deloitte & Touche LLP's principal business address is Two Hilton Court,
Parsippany, New Jersey 07054-0319.

On March 12, 1996, Deloitte & Touche LLP was dismissed as the independent
accountants of Pruco Life. There have been no disagreements with Deloitte &
Touche LLP on any matter of accounting principles or practices, financial
statements disclosure or auditing scope or procedure which, if not resolved to
the satisfaction of the accountant, would have caused them to make a reference
to the matter in their reports.

Actuarial matters included in this prospectus have been examined by Nancy D.
Davis, FSA, MAAA, Vice President and Actuary of Prudential whose opinion is
filed as an exhibit to the registration statement.

LITIGATION

Several actions have been brought against Pruco Life on behalf of those persons
who purchased life insurance policies based on complaints about sales practices
engaged in by Prudential, Pruco Life and agents appointed by Prudential and
Pruco Life. Prudential has agreed to indemnify Pruco Life for any and all losses
resulting from such litigation.

EXPANDED TABLE OF CONTENTS OF STATEMENT OF
ADDITIONAL INFORMATION

Included in the registration statements for the Contracts and the Series Fund is
a Statement of Additional Information which is available without charge by
writing to Pruco Life at 213 Washington Street, Newark, New Jersey 07102-2992.
The following table of contents of that Statement provides a brief summary of
what is included in each section.

I. MORE DETAILED INFORMATION ABOUT THE CONTRACT.

SALES LOAD UPON SURRENDER. A description is given of exactly how Pruco Life
determines the amount of the part of the sales load that is imposed only
upon surrenders or withdrawals during the first 10 Contract years.

25
<PAGE>

REDUCTION OF CHARGES FOR CONCURRENT SALES TO SEVERAL INDIVIDUALS. Where the
Contract is sold at the same time to several individuals who are members of
an associated class and Pruco Life's expenses will be reduced, some of the
charges under those Contracts may be reduced.

PAYING PREMIUMS BY PAYROLL DEDUCTION. Your employer may pay monthly
premiums for you with deductions from your salary.

UNISEX PREMIUMS AND BENEFITS. In some states and under certain
circumstances, premiums and benefits will not vary with the sex of the
insured.

HOW THE DEATH BENEFIT WILL VARY. A description is given of exactly how the
death benefit may increase to satisfy Internal Revenue Code requirements.

WITHDRAWAL OF EXCESS CASH SURRENDER VALUE. If the Contract Fund value is
high enough you may be able to withdraw part of the cash surrender value
while keeping the Contract in effect. There will be a transaction charge.
The death benefit will change. There may be tax consequences. You should
consult your Pruco Life representative to discuss whether a withdrawal or a
loan is preferable.

TAX TREATMENT OF CONTRACT BENEFITS. A fuller account is provided of how
Contract owners may be affected by federal income taxes.

SALE OF THE CONTRACT AND SALES COMMISSIONS. The Contract is sold primarily
by agents of Prudential who are also registered representatives of one of
its subsidiaries, Pruco Securities Corporation, a broker and dealer
registered under the Securities and Exchange Act of 1934. Generally,
selling agents receive a commission of 50% of the Scheduled Premium in the
first year, no more than 6% of the Scheduled Premiums for the second
through tenth years and smaller commissions thereafter.

RIDERS. Various extra fixed-benefits may be obtained for an extra premium.
They are described in what are known as "riders" to the Contract.

OTHER STANDARD CONTRACT PROVISIONS. The Contract contains several
provisions commonly included in all life insurance policies. They include
provisions relating to beneficiaries, misstatement of age or sex, suicide,
assignment, incontestability, and settlement options.

II. INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS.

General
Convertible Securities

Loan Participations

Warrants
Options and Futures
When-Issued and Delayed Delivery Securities
Short Sales
Short Sales Against the Box
Interest Rate Swaps
Loans of Portfolio Securities
Illiquid Securities
Forward Foreign Currency Exchange Contracts

A more detailed description is given of these investments and the policies
of these portfolios.

III. INVESTMENT RESTRICTIONS.

There are many restrictions upon the investments the portfolios may make
and the practices in which they may engage; these are fundamental, meaning
they may not be changed without Contract owner approval.

IV. INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES.

A fuller description than that in the prospectus is given.

V. PORTFOLIO TRANSACTIONS AND BROKERAGE.

A description is given of how securities transactions are effected and how
Prudential selects the brokers.

VI. DETERMINATION OF NET ASSET VALUE.

A full description is given of how the daily net asset value of each
portfolio is determined.

VII. SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST.

A full description is given.

26
<PAGE>

VIII. DEBT RATINGS.

A description is given of how Moody's Investors Services, Inc. and Standard
& Poor's Corporation describe the creditworthiness of debt securities.

IX. POSSIBLE REPLACEMENT OF THE SERIES FUND.

Although it is most unlikely, it is conceivable that Pruco Life might wish
to replace the Series Fund portfolios with other investment options. SEC
approval will be needed.

X. OTHER INFORMATION CONCERNING THE SERIES FUND.

Incorporation and Authorized Stock
Dividends, Distributions and Taxes
Custodian and Transfer Agent
Experts
License

More detail is provided about these matters.

XI. DIRECTORS AND OFFICERS OF PRUCO LIFE AND MANAGEMENT OF THE SERIES FUND.

The names and recent affiliations of Pruco Life's directors and executive
officers are given. The same information is given for the Series Fund.

XII. FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.

XIII. THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS.

ADDITIONAL INFORMATION

A registration statement has been filed with the SEC under the Securities Act of
1933, relating to the offering described in this prospectus. This prospectus and
the Statement of Additional Information do not include all of the information
set forth in the registration statement. Certain portions have been omitted
pursuant to the rules and regulations of the SEC. The omitted information may,
however, be obtained from the SEC's principal office in Washington, D.C., upon
payment of a prescribed fee.

Further information may also be obtained from Pruco Life. Its address and
telephone number are on the inside front cover of this prospectus.

FINANCIAL STATEMENTS

The financial statements of the Account should be distinguished from the
consolidated financial statements of Pruco Life which should be considered only
as bearing upon the ability of Pruco Life to meet its obligations under the
Contracts. The financial statements of the Series Fund are in the Statement of
Additional Information.

27
<PAGE>

UPDATED FINANCIALS WILL BE FILED PURSUANT TO RULE 485(b)

28
<PAGE>

PRUVIDER(SM)

VARIABLE APPRECIABLE LIFE(R)

INSURANCE CONTRACT

[LOGO] PRUDENTIAL

PRUCO LIFE INSURANCE COMPANY
213 Washington Street, Newark, NJ 07102-2992
Telephone 800 437-4016, Extension 46

A Subsidiary of
The Prudential Insurance Company of America

<PAGE>

PRUVIDER
VARIABLE
APPRECIABLE LIFE(R)
INSURANCE

MAY 1, 1997

PROSPECTUS

THE PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT
AND
THE PRUDENTIAL SERIES FUND, INC.

SVAL-2 ED 5-97 PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
CATALOG NO. 640189U

<PAGE>

PROSPECTUS

May 1, 1997

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

PRUVIDER(SM)

VARIABLE APPRECIABLE LIFE(R)

INSURANCE CONTRACT

This prospectus describes a variable life insurance contract issued by Pruco
Life Insurance Company of New Jersey ("Pruco Life of New Jersey"), a stock life
insurance company that is an indirect wholly-owned subsidiary of The Prudential
Insurance Company of America ("Prudential"). Pruco Life of New Jersey calls this
contract its PRUVIDER(SM) Variable APPRECIABLE LIFE(R) Insurance Contract* (the
"Contract"). The Contract provides whole-life insurance protection. The death
benefit varies daily with investment experience but will never be less than a
guaranteed minimum amount (the face amount specified in the Contract). The
Contract also generally provides a cash surrender value which does not have a
guaranteed minimum amount.

The assets held for the purpose of paying benefits under these and other similar
contracts are segregated from the other assets of Pruco Life of New Jersey and
are invested in one or both of the current subaccounts of the Pruco Life of New
Jersey Variable Appreciable Account (from now on, the "Account"). In this case,
the assets will be invested in the corresponding portfolio of The Prudential
Series Fund, Inc. (from now on, the "Series Fund"). The two portfolios of the
Series Fund currently available to Contract owners are the CONSERVATIVE BALANCED
PORTFOLIO and the FLEXIBLE MANAGED PORTFOLIO. The Contract owner may also choose
to have the assets invested in a FIXED-RATE OPTION. This prospectus describes
the Contract generally, the Pruco Life of New Jersey Variable Appreciable
Account and the securities issued by the Series Fund.

Before you sign an application to purchase this life insurance contract, you
should read this prospectus with care and have any questions you may have
answered by your Pruco Life of New Jersey representative. If you do purchase the
Contract, you should retain this prospectus for future reference, together with
the Contract itself that you will receive.

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
213 Washington Street
Newark, New Jersey 07102-2992
Telephone: (800) 437-4016, Ext. 46

* PRUVIDER is a service mark of Prudential.
APPRECIABLE LIFE is a registered mark of Prudential.
SVAL-2 Ed. 5-97

<PAGE>

TABLE OF CONTENTS
Page

FINANCIAL HIGHLIGHTS OF THE PORTFOLIOS OF THE SERIES FUND......................4

PORTFOLIO RATES OF RETURN......................................................6

ILLUSTRATIONS OF CASH SURRENDER VALUES, DEATH BENEFITS
AND ACCUMULATED PREMIUMS..............................................7

GENERAL INFORMATION ABOUT PRUCO LIFE OF NEW JERSEY VARIABLE
APPRECIABLE ACCOUNT AND THE FIXED RATE OPTION.........................8
PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT.................8
THE FIXED-RATE OPTION.................................................8

DETAILED INFORMATION FOR PROSPECTIVE CONTRACT OWNERS...........................9
REQUIREMENTS FOR ISSUANCE OF A CONTRACT...............................9
SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"..........................9
CONTRACT FEES AND CHARGES.............................................9
Deductions from Premiums.....................................9
Deductions from Portfolios...................................9
Monthly Deductions from Contract Fund.......................10
Daily Deduction from the Contract Fund......................11
Surrender or Withdrawal Charges.............................11
Transaction Charges.........................................12
CONTRACT DATE........................................................12
PREMIUMS ............................................................12
ALLOCATION OF PREMIUMS...............................................13
TRANSFERS............................................................13
HOW THE CONTRACT FUND CHANGES WITH INVESTMENT EXPERIENCE.............14
HOW A CONTRACT'S DEATH BENEFIT WILL VARY.............................14
CONTRACT LOANS.......................................................14
SURRENDER OF A CONTRACT..............................................15
LAPSE AND REINSTATEMENT..............................................15
Fixed Extended Term Insurance...............................16
Fixed Reduced Paid-Up Insurance.............................16
Variable Reduced Paid-Up Insurance..........................16
What Happens If No Request Is Made?.........................16
PAID-UP INSURANCE OPTION.............................................16
REDUCED PAID-UP INSURANCE OPTION.....................................17
WHEN PROCEEDS ARE PAID...............................................17
LIVING NEEDS BENEFIT.................................................17
Terminal Illness Option.....................................17
VOTING RIGHTS........................................................18
REPORTS TO CONTRACT OWNERS...........................................18
TAX TREATMENT OF CONTRACT BENEFITS...................................19
Treatment as Life Insurance.................................19
Pre-Death Distributions.....................................19
Other Tax Consequences......................................19
OTHER CONTRACT PROVISIONS............................................19

FURTHER INFORMATION ABOUT THE SERIES FUND.....................................20

<PAGE>

Page

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS..........................20
BALANCED PORTFOLIOS..................................................20
CONSERVATIVE BALANCED PORTFOLIO.............................20
FLEXIBLE MANAGED PORTFOLIO..................................21
FOREIGN SECURITIES...................................................22
OPTIONS, FUTURES CONTRACTS AND SWAPS.................................23
SHORT SALES..........................................................23
REPURCHASE AGREEMENTS................................................23
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS.......................23
LOANS OF PORTFOLIO SECURITIES........................................24

INVESTMENT RESTRICTIONS APPLICABLE TO THE PORTFOLIOS..........................24

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................24
PORTFOLIO BROKERAGE AND RELATED PRACTICES............................25

STATE REGULATION..............................................................25

EXPERTS .....................................................................25

LITIGATION....................................................................26

EXPANDED TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION.............26

ADDITIONAL INFORMATION........................................................27

FINANCIAL STATEMENTS..........................................................27

FINANCIAL STATEMENTS OF THE PRUCO LIFE PRUvider VARIABLE
APPRECIABLE ACCOUNT..................................................A1

CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE INSURANCE
COMPANY OF NEW JERSEY AND SUBSIDIARIES...............................B1

INTRODUCTION AND SUMMARY

As you read this prospectus you should keep in mind that you are considering the
purchase of a life insurance contract. Because it is variable life insurance -
and variable life insurance has significant investment aspects and requires you
to make investment decisions - it is also a "security." That is why you have
been given this prospectus. Securities which are offered to the public must be
registered with the Securities and Exchange Commission, and the prospectus that
is a part of the registration statement must be given to all prospective buyers.
But because a substantial part of your premium pays for life insurance that will
pay to your beneficiary, in the event of your death, an amount far exceeding
your total premium payments, you should not buy this contract unless a major
reason for the purchase is to provide life insurance protection. Because the
contract provides whole-life or permanent insurance, it also serves a second
important objective. It can be expected to provide an increasing cash surrender
value that can be used during your lifetime.

BRIEF DESCRIPTION OF THE CONTRACT

The PRUVIDER Variable APPRECIABLE LIFE Contract (referred to from now on as the
"Contract") is issued and sold by the Pruco Life Insurance Company of New Jersey
("Pruco Life of New Jersey"), a stock life insurance company, organized in 1982
under the laws of the State of New Jersey. It is licensed to sell life insurance
and annuities only in the States of New Jersey and New York. These Contracts are
not offered in any state in which the necessary approvals have not yet been
obtained.

Pruco Life of New Jersey is a wholly-owned subsidiary of Pruco Life Insurance
Company, which in turn is a wholly-owned subsidiary of Prudential, a mutual
insurance company founded in 1875 under the laws of the State of New Jersey. As
of December 31, 1996, Prudential has invested $XXX million in Pruco Life of New
Jersey through its subsidiary Pruco Life Insurance Company in connection with
Pruco Life of New Jersey's organization and operation. Prudential intends from
time to time to make additional capital contributions to Pruco Life of New
Jersey as needed to enable it to meet its reserve requirements and expenses in
connection with its business. Prudential is under no obligation to make such
contributions and its assets do not back the benefits payable under the
Contract. Pruco Life of New Jersey's consolidated financial statements begin on
page B1 and should be considered only as bearing upon Pruco Life of New Jersey's
ability to meet its obligations under the Contracts.

A broad objective of the Contract is to provide benefits that will increase in
value if favorable investment results are achieved. Pruco Life of New Jersey has
established a separate account, like a separate division within the Company,
called the Pruco Life of New Jersey Variable Appreciable Account. Whenever you
pay a premium, Pruco Life of New Jersey first deducts certain charges (described
below) and, unless you decide otherwise puts the remainder - often called the
"net premium" - into the Account, where it is combined with the net premiums
from all other contracts like this one. The money in the Account, including your
Contract Fund, is then invested in the following way. The Account is divided
into 2 subaccounts and you must decide which one[s] will hold the assets of your
Contract Fund. The money allocated to each subaccount is immediately invested in
a corresponding portfolio of The Prudential Series Fund, Inc. Those two
portfolios -- called the CONSERVATIVE BALANCED PORTFOLIO and the FLEXIBLE
MANAGED PORTFOLIO -- differ in the amount of risk associated with them and are
described in more detail below.

Pruco Life of New Jersey deducts certain charges from each premium payment and
from the amounts held in the designated investment options. In addition, Pruco
Life of New Jersey makes certain additional charges if a Contract lapses or is
surrendered during the first 10 Contract years. All these charges, which are
largely designed to cover insurance costs and risks as well as sales and
administrative expenses, are fully described under CONTRACT

1
<PAGE>

FEES AND CHARGES on page 9. In brief, and subject to that fuller description,
the following diagram outlines the charges which may be made:

--------------------------------------------
PREMIUM PAYMENT
--------------------------------------------

------------------------------
o less charge for taxes
attributable to premiums
o less $2 processing fee
------------------------------

- --------------------------------------------------------------------------------
INVESTED PREMIUM AMOUNT
- --------------------------------------------------------------------------------
o To be invested in one or a combination of:
o The Conservative Balanced Portfolio
o The Flexible Managed Portfolio

o The Fixed-Rate Option

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

- --------------------------------------------------------------------------------
DAILY CHARGES
- --------------------------------------------------------------------------------
o A daily charge equivalent to an annual rate of up to 0.9% is deducted from
the assets of the subaccounts for mortality and expense risks.
o Management fees and expenses are deducted from the assets of the Series
Fund. See DEDUCTIONS FROM PORTFOLIOS, page 9.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
MONTHLY CHARGES
- --------------------------------------------------------------------------------
o A sales charge is deducted from the Contract Fund in the amount of1/2of 1%
of the primary annual premium.
o The Contract Fund is reduced by a guaranteed minimum death benefit risk
charge of not more than $0.01 per $1,000 of the face amount of insurance.
o The Contract Fund is reduced by an administrative charge of up to $6 per
Contract and up to $0.19 per $1,000 of face amount of insurance (currently,
on a non-guaranteed basis, the $0.19 charge is decreased to $0.09 per
$1,000); if the face amount of the Contract is less than $10,000, there is
an additional charge of $0.30 per $1,000 of face amount.
o A charge for anticipated mortality is deducted, with the maximum charge
based on the non-smoker/smoker 1980 CSO Tables.
o If the Contract includes riders, a deduction from the Contract Fund will be
made for charges applicable to those riders; a deduction will also be made
if the rating class of the insured results in an extra charge.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
POSSIBLE ADDITIONAL CHARGES
- --------------------------------------------------------------------------------
o If the Contract lapses or is surrendered during the first 10 years, a
contingent deferred sales charge is assessed; the maximum contingent
deferred sales charge during the first 5 years is 50% of the first year's
primary annual premium but this charge is both subject to other important
limitations and reduced for Contracts that have been in force for more than
5 years.
o If the Contract lapses or is surrendered during the first 10 years, a
contingent deferred administrative charge is assessed; during the first 5
years, this charge equals $5 per $1,000 of face amount and it begins to
decline uniformly after the fifth Contract year so that it disappears on
the tenth Contract anniversary.
o An administrative processing charge of $15 will be made in connection with
each withdrawal of excess cash surrender value.
- --------------------------------------------------------------------------------

When you first buy the Contract you give instructions to Pruco Life of New
Jersey as to what combination of the three investment options you wish your
Contract Fund invested. Thereafter you may make changes in these

2
<PAGE>

allocations either in writing or by telephone. The investment objectives of the
portfolios, described more fully starting on page 20 of this prospectus, and of
the fixed-rate option are as follows:

BALANCED PORTFOLIOS

CONSERVATIVE BALANCED PORTFOLIO. Achievement of a favorable total investment
return consistent with a portfolio having a conservatively managed mix of money
market instruments, fixed income securities, and common stocks, in proportions
believed by the investment manager to be appropriate for an investor who desires
diversification of investment who prefers a relatively lower risk of loss than
that associated with the Flexible Managed Portfolio while recognizing that this
reduces the chances of greater appreciation.

FIXED-RATE OPTION

Guarantee against loss of principal plus income at a rate which may change at
yearly intervals, but will never be lower than an effective annual rate of 4%.

TRANSFERS BETWEEN INVESTMENT OPTIONS

THE SCHEDULED PREMIUM

Your Contract sets forth an annual Scheduled Premium, or one that is payable
more frequently, such as monthly. Pruco Life of New Jersey guarantees that, if
the Scheduled Premiums are paid when due (or if missed premiums are paid later,
with interest), the death benefit will be paid upon the death of the insured.
The Contract will not lapse even if investment experience is unexpectedly so
unfavorable that the Contract Fund value drops to below zero.

The amount of the scheduled premium depends on the Contract's face amount, the
insured's sex (except where unisex rates apply) and age at issue, the insured's
risk classification, the rate for taxes attributable to premiums, and the
frequency of premium payments selected. Under certain low face amount Contracts
issued on younger insureds, the payment of the Scheduled Premium may cause the
Contract to be classified as a Modified Endowment Contract. See TAX TREATMENT OF
CONTRACT BENEFITS, page 19. The scheduled premium will not be increased (except
to reflect changes in the rate for taxes attributable to premiums). See
PREMIUMS, page 12.

PAYMENT OF HIGHER PREMIUMS

CONTRACT LOANS

PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACTS

Pruco Life of New Jersey's PRUVIDER Variable APPRECIABLE LIFE Insurance Contract
is a form of life insurance that provides much of the flexibility of variable
universal life. However, it differs in two important ways. First, Pruco Life of
New Jersey guarantees that if the Scheduled Premiums are paid when due or within
the grace period (or missed premiums are paid later with interest), the Contract
will not lapse and the face amount of insurance will be paid upon the death of
the insured even if, because of unfavorable investment experience, the Contract
Fund value should drop to below zero. Second, if all premiums are not paid when
due (or made up), the Contract will not lapse as long as the Contract Fund is
higher than a stated amount set forth in a table in the Contract - an amount
that increases each year and in later years becomes quite high; it is called the
"Tabular Contract Fund." The Contract lapses when the Contract Fund falls to
below this stated amount, rather than when it drops to zero. Thus, when a
PRUVIDER Variable APPRECIABLE LIFE Contract lapses, it may still have
considerable value and you will,

3
<PAGE>

therefore, have a substantial incentive to reinstate it, as well as an
opportunity to make a considered decision whether to do so or to take, in one
form or another, the cash surrender value. In effect, Pruco Life of New Jersey
provides an early and timely warning against the imprudent use of the
flexibility provided by the Contract.

FINANCIAL HIGHLIGHTS OF THE PORTFOLIOS
OF THE SERIES FUND

4
<PAGE>

THE PRUDENTIAL SERIES FUND, INC. FINANCIAL HIGHLIGHTS

TO BE FILED BY POST-EFFECTIVE AMENDMENT PURSUANT TO RULE 485(B)

5
<PAGE>

PORTFOLIO RATES OF RETURN

TO BE FILED BY POST-EFFECTIVE AMENDMENT PURSUANT TO RULE 485(B)

6
<PAGE>

ILLUSTRATIONS OF CASH SURRENDER VALUES, DEATH BENEFITS
AND ACCUMULATED PREMIUMS

The death benefits and cash surrender values shown in the first two tables on
pages T1 and T2 reflect Pruco Life of New Jersey's current charges. The values
shown in these tables are calculated upon the assumption that Pruco Life of New
Jersey will continue to use the administrative charges and mortality rates that
it is currently using, even though it is permitted under the Contract to use
higher administrative charges and the higher mortality charges specified in the
1980 CSO Table. While Pruco Life of New Jersey does not currently intend to
withdraw or modify these reductions in charges, it reserves the right to do so.

The death benefits and cash surrender values shown in the next two tables on
pages T3 and T4 are calculated upon the assumption that the maximum
administrative charges allowable under the Contract and the maximum mortality
charges specified by the 1980 CSO Table are made throughout the life of the
Contract; they do not reflect Pruco Life of New Jersey's current practice of
reducing the administrative and mortality charges.

Upon request, Pruco Life of New Jersey will furnish a comparable hypothetical
illustration based on the proposed insured's age and sex (except where unisex
rates apply) and on the face amount or premium amount requested. The
illustrations can be prepared upon the assumptions that the insured is in the
preferred or standard rating class or in a different risk classification, and
can assume that annual, semi-annual, quarterly or monthly premiums are paid.

7
<PAGE>
ILLUSTRATIONS

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

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$5,000 GUARANTEED DEATH BENEFIT
$173.70 ANNUAL PREMIUM (1)
USING CURRENT CONTRACTUAL CHARGES

(2) Assumes no Contract loan has been made.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A
REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF
RETURN MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF
FACTORS INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING
INTEREST RATES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUCO LIFE OF NEW JERSEY OR THE SERIES FUND
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER ANY PERIOD OF TIME.

<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$20,000 GUARANTEED DEATH BENEFIT
$390.90 ANNUAL PREMIUM (1)
USING CURRENT CONTRACTUAL CHARGES

(2) Assumes no Contract loan has been made.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A
REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF
RETURN MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF
FACTORS INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING
INTEREST RATES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUCO LIFE OF NEW JERSEY OR THE SERIES FUND
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER ANY PERIOD OF TIME.

<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$5,000 GUARANTEED DEATH BENEFIT
$173.70 ANNUAL PREMIUM (1)
USING MAXIMUM CONTRACTUAL CHARGES

(2) Assumes no Contract loan has been made.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A
REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF
RETURN MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF
FACTORS INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING
INTEREST RATES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUCO LIFE OF NEW JERSEY OR THE SERIES FUND
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER ANY PERIOD OF TIME.

<PAGE>

THE PRUVIDER VARIABLE APPRECIABLE LIFE INSURANCE CONTRACT
MALE PREFERRED ISSUE AGE 35
$20,000 GUARANTEED DEATH BENEFIT
$390.90 ANNUAL PREMIUM (1)
USING MAXIMUM CONTRACTUAL CHARGES

(2) Assumes no Contract loan has been made.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A
REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF
RETURN MAY BE MORE OR LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF
FACTORS INCLUDING THE INVESTMENT ALLOCATIONS MADE BY AN OWNER, PREVAILING
INTEREST RATES, AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH SURRENDER
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES
OF RETURN AVERAGED 0%, 4%, 8%, AND 12% OVER A PERIOD OF YEARS BUT ALSO
FLUCTUATED ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO
REPRESENTATIONS CAN BE MADE BY PRUCO LIFE OF NEW JERSEY OR THE SERIES FUND
THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER ANY PERIOD OF TIME.

<PAGE>

GENERAL INFORMATION ABOUT
PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE
ACCOUNT AND THE FIXED RATE OPTION

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

The Pruco Life of New Jersey Variable Appreciable Account was established on
January 13, 1984 under New Jersey law as a separate investment account. The
Account meets the definition of a "separate account" under the federal
securities laws. The Account holds assets that are segregated from all of Pruco
Life of New Jersey's other assets.

The obligations to Contract owners and beneficiaries arising under the Contract
are general corporate obligations of Pruco Life of New Jersey. Pruco Life of New
Jersey is also the legal owner of the assets in the Account. Pruco Life of New
Jersey will maintain assets in the Account with a total market value at least
equal to the reserve and other liabilities relating to the variable benefits
attributable to the Account. These assets may not be charged with liabilities
which arise from any other business Pruco Life of New Jersey conducts. In
addition to these assets, the Account's assets may include funds contributed by
Pruco Life of New Jersey to commence operation of the Account and may include
accumulations of the charges Pruco Life of New Jersey makes against the Account.
From time to time these additional assets will be transferred to Pruco Life of
New Jersey's general account. Before making any such transfer, Pruco Life of New
Jersey will consider any possible adverse impact the transfer might have on the
Account.

The Account is registered with the Securities and Exchange Commission ("SEC")
under the Investment Company Act of 1940 ("1940 Act") as a unit investment
trust, which is a type of investment company. This does not involve any
supervision by the SEC of the management or investment policies or practices of
the Account. For state law purposes, the Account is treated as a part or
division of Pruco Life of New Jersey. There are currently two subaccounts within
the Account, one of which invests in the Conservative Balanced Portfolio and the
other of which invests in the Flexible Managed Portfolio of the Series Fund.
Additional subaccounts may be added in the future. The Account's financial
statements begin on page A1.

THE FIXED-RATE OPTION

Because of exemptive and exclusionary provisions, interests in the fixed-rate
option under the Contract have not been registered under the Securities Act of
1933 and the general account has not been registered as an investment company
under the Investment Company Act of 1940. Accordingly, interests in the
fixed-rate option are not subject to the provisions of these Acts, and Pruco
Life of New Jersey has been advised that the staff of the Securities and
Exchange Commission has not reviewed the disclosure in this Prospectus relating
to the fixed-rate option. Any inaccurate or misleading disclosure regarding the
fixed-rate option may, however, subject Pruco Life of New Jersey and its
directors to civil liability if that results in any damage.

As explained earlier, you may elect to allocate, either initially or by
transfer, all or part of the amount credited under the Contract to the
fixed-rate option, and the amount so allocated or transferred becomes part of
Pruco Life of New Jersey's general assets. Sometimes this is referred to as
Pruco Life of New Jersey's general account, which consists of all assets owned
by Pruco Life of New Jersey other than those in the Account and in other
separate accounts that have been or may be established by Pruco Life of New
Jersey. Subject to applicable law, Pruco Life of New Jersey has sole discretion
over the investment of the assets of the general account, and Contract owners do
not share in the investment experience of those assets. Instead, Pruco Life of
New Jersey guarantees that the part of the Contract Fund allocated to the
fixed-rate option will accrue interest daily at an effective annual rate that
Pruco Life of New Jersey declares periodically. This rate may not be less than
an effective annual rate of 4%. Currently, declared interest rates remain in
effect from the date money is allocated to the fixed-rate option until the
Monthly date in the same month in the following year. See CONTRACT DATE, page
12. Thereafter, a new crediting rate will be declared each year and will remain
in effect for the calendar year. Pruco Life of New Jersey reserves the right to
change this practice. Pruco Life of New Jersey is not obligated to credit
interest at a higher rate than 4%, although in its sole discretion it may do so.
Different crediting rates may be declared for different portions of the Contract
Fund allocated to the fixed-rate option. At least annually and on request, a
Contract owner will be advised of the interest rates that currently apply to his
or her Contract.

8
<PAGE>

DETAILED INFORMATION FOR PROSPECTIVE
CONTRACT OWNERS

REQUIREMENTS FOR ISSUANCE OF A CONTRACT

The Contract may generally be issued on insureds below the age of 76. Generally,
the minimum initial guaranteed death benefit that can be applied for is $5,000
and the maximum that can be applied for is $25,000. For proposed insureds 21
years of age or younger, the minimum initial guaranteed death benefit that can
be applied for is $10,000. Before issuing any Contract, Pruco Life of New Jersey
requires evidence of insurability which may include a medical examination.
Non-smokers who meet preferred underwriting requirements are offered the most
favorable premium rate. A higher premium is charged if an extra mortality risk
is involved. These are the current underwriting requirements. The Company
reserves the right to change these requirements on a non-discriminatory basis.

SHORT-TERM CANCELLATION RIGHT OR "FREE LOOK"

Generally, you may return the Contract for a refund within 10 days after you
receive it, within 45 days after Part I of the application for insurance is
signed, or within 10 days after Pruco Life of New Jersey mails or delivers a
Notice of Withdrawal Right, whichever is latest. Some states allow a longer
period of time during which a Contract may be returned for a refund. A refund
can be requested by mailing or delivering the Contract to the representative who
sold it or to the Home Office specified in the Contract. A Contract returned
according to this provision shall be deemed void from the beginning. You will
then receive a refund of all premium payments made, plus or minus any change due
to investment experience. However, if applicable law so requires, if you
exercise your short-term cancellation right, you will receive a refund of all
premium payments made, with no adjustment for investment experience.

CONTRACT FEES AND CHARGES

This section provides a detailed description of each charge that is described
briefly in the chart on page 2, and an explanation of the purpose of the charge.

In several instances we will use the terms "maximum charge" and "current
charge." The "maximum charge," in each instance, will be the highest charge that
Pruco Life of New Jersey is entitled to make under the Contract. The "current
charge" is the lower amount that Pruco Life of New Jersey is now charging.
However, if circumstances change, Pruco Life of New Jersey reserves the right to
increase each current charge, up to but to no more than the maximum charge,
without giving any advance notice.

DEDUCTIONS FROM PREMIUMS

(a) A charge for taxes attributable to premiums is deducted from each premium.
That charge is currently made up of two parts. The first part is in an amount
equal to the state or local premium tax. It varies from jurisdiction to
jurisdiction and generally ranges from 0.75% to 5% (but in some instances it may
exceed 5%) of the premium received by Pruco Life of New Jersey. The second part
is for federal income taxes measured by premiums and it is equal to 1.25% of the
premium. Pruco Life of New Jersey believes that this charge is a reasonable
estimate of an increase in its federal income taxes resulting from a 1990 change
in the Internal Revenue Code. It is intended to recover this increased tax.
During 1996 and 1995, Pruco Life of New Jersey received a total of approximately
$XXX and $153,339, respectively, in charges for payment of taxes attributable to
premiums.

(b) A charge of $2 is deducted from each premium payment to cover the cost of
collecting and processing premiums. Thus, if you pay premiums annually, this
charge will be $2 per year. If you pay premiums monthly, the charge will be $24
per year. If you pay premiums more frequently, for example under a payroll
deduction plan with your employer, the charge may be more than $24 per year.
During 1996 and 1995, Pruco Life of New Jersey received a total of approximately
$XXX and $169,672, respectively, in processing charges.

DEDUCTIONS FROM PORTFOLIOS

(a) An investment advisory fee is deducted daily from each portfolio at an
annual rate of 0.55% for the Conservative Balanced Portfolio and 0.6% for the
Flexible Managed Portfolio.

9
<PAGE>

For the years 1996, 1995, and 1994, Prudential received a total of $XXX,
$77,610,207, and $66,413,206, respectively, in investment management fees for
all of the Series Fund's portfolios.

Monthly Deductions from Contract Fund

The following monthly charges are deducted proportionately from the dollar
amounts held in each of the chosen investment option[s].

(a) A sales charge, often called a sales load, is deducted to pay part of the
costs Pruco Life of New Jersey incurs in selling the Contracts, including
commissions, advertising and the printing and distribution of prospectuses and
sales literature. The charge is equal to 0.5% of the "primary annual premium"
which is equal to the Scheduled Premium that would be payable if premiums were
being paid annually, less the two deductions from premiums (taxes attributable
to premiums and the $2 processing charge), and less the $6 part of the monthly
deduction described in (c) below, the $0.30 per $1,000 of face amount for
Contracts with a face amount of less than $10,000, and any extra premiums for
riders or substandard risks. The deduction is made whether the Contract owner is
paying premiums annually or more frequently. It is lower on Contracts issued on
insureds over 60 years of age. To summarize, this charge is somewhat less than
(significantly less for Contracts with small face amounts) 6% of the annual
Scheduled Premium.

There is a second sales load, which will be charged only if a Contract lapses or
is surrendered before the end of the 10th Contract year. It is often described
as a contingent deferred sales load ("CDSL") and is described later under
SURRENDER OR WITHDRAWAL CHARGES, page 11. During 1996 and 1995, Pruco Life of
New Jersey received a total of approximately $XXX and $351,003, respectively, in
sales load charges.

(b) A charge of not more than $0.01 per $1000 of face amount of insurance is
made to compensate Pruco Life of New Jersey for the risk it assumes by
guaranteeing that, no matter how unfavorable investment experience may be, the
death benefit will never be less than the guaranteed minimum death benefit so
long as Scheduled Premiums are paid on or before the due date or during the
grace period. This charge will not be made if the Contract has been continued in
force pursuant to an option on lapse. During 1996 and 1995, Pruco Life of New
Jersey received a total of approximately $XXX and $19,558, respectively, for
this risk charge.

(c) An administrative charge of $6 plus up to $0.19 per $1,000 per month of face
amount of insurance is deducted each month. Currently, on a non-guaranteed
basis, this charge is reduced from $0.19 to $0.09 per $1,000. The charge is
intended to pay for processing claims, keeping records, and communicating with
Contract owners. If premiums are paid by automatic transfer under the Pru-Matic
Plan, as described on page 12, the current charge is further reduced to $0.07
per $1,000 of face amount. There is an additional charge of $0.30 per $1,000 of
face amount if the face amount of the Contract is less than $10,000. This
monthly administrative charge will not be made if the Contract has been
continued in force pursuant to an option on lapse. During 1996 and 1995, Pruco
Life of New Jersey received a total of approximately $XXX and $1,028,516,
respectively, in monthly administrative charges.

(d) A mortality charge is deducted that is intended to be used to pay death
benefits. When an insured dies, the amount payable to the beneficiary is larger
than the Contract Fund and significantly larger if the insured dies in the early
years of a Contract. The mortality charges collected from all Contract owners
enables Pruco Life of New Jersey to pay the death benefit for the few insureds
who die. The maximum mortality charge is determined by multiplying the "net
amount at risk" under a Contract (the amount by which the Contract's death
benefit, computed as if there were neither riders nor Contract debt, exceeds the
Contract Fund) by a rate based upon the insured's current attained age and sex
(except where unisex rates apply) and the anticipated mortality for that class
of persons. The anticipated mortality is based upon mortality tables published
by The National Association of Insurance Commissioners called the
Non-Smoker/Smoker 1980 CSO Tables. Pruco Life of New Jersey may determine that a
lesser amount than that called for by these mortality tables will be adequate
for insureds of particular ages and may thus make a lower mortality charge for
such persons. Any lower current mortality charges are not applicable to
Contracts in force pursuant to an option on lapse. See LAPSE AND REINSTATEMENT,
page 15.

(e) If the Contract includes riders, Pruco Life of New Jersey deducts any
charges applicable to those riders from the Contract Fund on each Monthly date.
In addition, Pruco Life of New Jersey will deduct on each Monthly date any extra
charge incurred because of the rating class of the insured.

10
<PAGE>

(f) A charge may be deducted to cover federal, state or local taxes (other than
"taxes attributable to premiums" described above) that are imposed upon the
operations of the Account. At present no such taxes are imposed and no charge is
made. Pruco Life of New Jersey will review the question of a charge to the
Account for company federal income taxes periodically. Such a charge may be made
in future years for any company federal income taxes that would be attributable
to the Account.

Under current law, Pruco Life of New Jersey may incur state and local taxes (in
addition to premium taxes) in several states. At present, these taxes are not
significant and they are not charged against the Account. If there is a material
change in the applicable state or local tax laws, the imposition of any such
taxes upon Pruco Life of New Jersey that are attributable to the Account may
result in a corresponding charge against the Account.

Daily Deduction from the Contract Fund

Each day a charge is deducted from the assets of each of the subaccounts in an
amount equivalent to an effective annual rate of up to 0.9%. This charge is
intended to compensate Pruco Life of New Jersey for assuming mortality and
expense risks under the Contract. The mortality risk assumed is that insureds
may live for shorter periods of time than Pruco Life of New Jersey estimated
when it determined what mortality charge to make. The expense risk assumed is
that expenses incurred in issuing and administering the Contract will be greater
than Pruco Life of New Jersey estimated in fixing its administrative charges.
This charge is not assessed against amounts allocated to the fixed-rate option.
During 1996 and 1995, Pruco Life of New Jersey received a total of approximately
$XXX and $71,857, respectively, in mortality and expense risk charges.

Surrender or Withdrawal Charges

The percentages shown in the last column will not be appreciably different for
insureds of different ages.

(b) An administrative charge of $5 per $1,000 of face amount of insurance is
deducted upon lapse or surrender to cover the cost of processing applications,
conducting medical examinations, determining insurability and the insured's
rating class, and establishing records. However, this charge is reduced
beginning on the Contract's fifth anniversary and declines daily at a constant
rate until it disappears entirely on the tenth Contract anniversary. We are
currently allowing partial surrenders of the Contract, but we reserve the right
to cancel this administrative practice. If the Contract is partially surrendered
during the first 10 years, a proportionate amount of the charge will be deducted
from the Contract Fund. During 1996 and 1995, Pruco Life of New Jersey received
a total of approximately $XXX and $22,963, respectively, for surrendered or
lapsed Contracts.

11
<PAGE>

Transaction Charges

CONTRACT DATE

When the first premium payment is paid with the application for a Contract, the
Contract date will ordinarily be the later of the date of the application or the
date of any medical examination. In most cases no medical examination will be
necessary. If the first premium is not paid with the application, the Contract
date will ordinarily be the date the first premium was paid and the Contract was
delivered. Under certain circumstances, Pruco Life of New Jersey will permit a
Contract to be back-dated but only to a date not earlier than 6 months prior to
the date of the application. It may be advantageous for a Contract owner to have
an earlier Contract date since that will result in the use by Pruco Life of New
Jersey of a lower issue age in determining the amount of the scheduled premium.
Pruco Life of New Jersey will require the payment of all premiums that would
have been due had the application date coincided with the back-dated Contract
date. The death benefit and cash surrender value under the Contract will be
equal to what they would have been had the Contract been issued on the Contract
date, all scheduled premiums been received on their due dates, and all Contract
charges been made.

PREMIUMS

As already explained, the Contract provides for a Scheduled Premium which, if
paid when due or within a 61 day grace period, ensures that the Contract will
not lapse. If you pay premiums other than on a monthly basis, you will receive a
notice that a premium is due about 3 weeks before each due date. If you pay
premiums monthly, you will receive a book each year with 12 coupons that will
serve as a reminder. With Pruco Life of New Jersey's consent, you may change the
frequency of premium payments.

- --------------------------------------------------------------------------------
$10,000 FACE AMOUNT $20,000 FACE AMOUNT
- --------------------------------------------------------------------------------
MONTHLY ANNUAL MONTHLY ANNUAL
- --------------------------------------------------------------------------------
Male, age 35 $22.43 $233.70 $36.59 $390.90
at issue
- --------------------------------------------------------------------------------
Female, age 45 $26.46 $278.04 $44.65 $479.59
at issue
- --------------------------------------------------------------------------------
Male, age 55 $41.96 $450.96 $75.66 $825.43
at issue
- --------------------------------------------------------------------------------

12
<PAGE>

A significant feature of this Contract is that it permits you to pay greater
than Scheduled Premiums. This may be done by making occasional unscheduled
premium payments or on a periodic basis. If you wish, you may select a higher
contemplated premium than the Scheduled Premium. Pruco Life of New Jersey will
then bill you for the chosen premium. In general, the regular payment of higher
premiums will result in higher cash surrender values and higher death benefits.
Conversely, payment of a Scheduled Premium need not be made if the Contract Fund
is sufficiently large to enable the charges due under the Contract to be made
without causing the Contract to lapse. See LAPSE AND REINSTATEMENT, page 15. The
payment of premiums in excess of Scheduled Premiums may cause the Contract to
become a Modified Endowment Contract. If this happens, loans and other
distributions which would otherwise not be taxable events will be subject to
federal income taxation. See TAX TREATMENT OF CONTRACT BENEFITS, page 19.

Pruco Life of New Jersey will generally accept any premium payment if the
payment is at least $25. Pruco Life of New Jersey does reserve the right,
however, to limit unscheduled premiums to a total of $5,000 in any Contract
year, and to refuse to accept premiums that would immediately result in more
than a dollar-for-dollar increase in the death benefit. See HOW A CONTRACT'S
DEATH BENEFIT WILL VARY, page 14. The privilege of making large or additional
premium payments offers a way of investing amounts which accumulate without
current income taxation, but again, there are tax consequences if the Contract
becomes a Modified Endowment Contract. See TAX TREATMENT OF CONTRACT BENEFITS,
page 19.

ALLOCATION OF PREMIUMS

On the Contract date, a $2 processing charge and the charge for taxes
attributable to premiums are deducted from the initial premium. The remainder is
allocated on the Contract date among the subaccount[s] or the fixed-rate option
according to the desired allocation specified in the application form. From this
invested portion of the initial premium, the first monthly deductions are made.
See CONTRACT FEES AND CHARGES, page 9. The invested portion of any part of the
initial premium in excess of the Scheduled Premium is placed in the selected
investment option[s] on the date of receipt, but not earlier than the Contract
date. Thus, to the extent that the receipt of the first premium precedes the
Contract date, there will be a period during which the Contract owner's initial
premium will not be invested. All subsequent premium payments, after the
deduction from premiums, when received by Pruco Life of New Jersey will be
placed in the subaccount[s] or the fixed-rate option in accordance with the
allocation previously designated. Provided the Contract is not in default, you
may change the way in which subsequent premiums are allocated by giving written
notice to a Home Office. You may also change the way in which subsequent
premiums are allocated by telephoning the Home Office, provided you are enrolled
to use the Telephone Transfer system. There is no charge for reallocating future
premiums. If any part of the invested portion of a premium is allocated to a
particular investment option, that portion must be at least 10% on the date the
allocation takes effect. All percentage allocations must be in whole numbers.
For example, 33% can be selected but 331/3% cannot. Of course, the total
allocation of all selected investment options must equal 100%.

TRANSFERS

If the Contract is not in default, or if the Contract is in force as variable
reduced paid-up insurance (see LAPSE AND REINSTATEMENT , page 15), you may, up
to four times in each Contract year, transfer amounts from one subaccount to the
other subaccount or to the fixed-rate option. Currently, you may make additional
transfers with Pruco Life of New Jersey's consent. There is no charge. All or a
portion of the amount credited to a subaccount may be transferred.

Transfers between subaccounts will take effect as of the end of the valuation
period (usually the business day) in which a proper transfer request is received
at a Home Office. The valuation period is defined as the period of time from one
determination of the value of the amount invested in a subaccount to the next.
Such determinations are made when the net asset values of the portfolios are
calculated, which is generally at 4:15 p.m. New York City time on each day
during which the New York Stock Exchange is open. The request may be in terms of
dollars, such as a request to transfer $1,000 from one subaccount to the other,
or may be in terms of a percentage reallocation between subaccounts. In the
latter case, as with premium reallocations, the percentages must be in whole
numbers. You may transfer amounts by proper written notice to a Home Office or
by telephone, provided you are enrolled to use the Telephone Transfer System.
You will automatically be enrolled to use the Telephone Transfer System unless
the Contract is jointly owned or you elect not to have this privilege. Telephone
transfers may not be available on policies that are assigned, depending on the
terms of the assignment. Pruco Life of New Jersey has adopted procedures
designed to ensure that requests by telephone are genuine and will require
appropriate identification for that purpose. Pruco Life of New Jersey will not
be held liable for following telephone

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<PAGE>

instructions that we reasonably believe to be genuine. Pruco Life of New Jersey
cannot guarantee that you will be able to get through to complete a telephone
transfer during peak periods such as periods of drastic economic or market
change.

Transfers from the fixed-rate option are subject to restrictions and may only be
made with Pruco Life of New Jersey's consent. Transfers from the fixed-rate
option to the subaccounts are currently permitted once each Contract year and
only during the 30-day period beginning on the Contract anniversary. The maximum
amount which may be transferred out of the fixed-rate option each year is
currently the greater of: (a) 25% of the amount in the fixed-rate option, or (b)
$2,000. Such transfer requests received prior to the Contract anniversary will
be effected on the Contract anniversary. Transfer requests received within the
30-day period beginning on the Contract anniversary will be effected as of the
end of the valuation period in which a proper transfer request is received at a
Home Office. These limits are subject to change in the future.

HOW THE CONTRACT FUND CHANGES WITH INVESTMENT EXPERIENCE

As explained above, after the tenth Contract year, there will no longer be a
surrender charge and, if there is no Contract loan, the cash surrender value
will be equal to the Contract Fund. This section, therefore, also describes how
the cash surrender value of the Contract will change with investment experience.

A Contract's cash surrender value on any date will be the Contract Fund value
reduced by the withdrawal charges, if any, and by any Contract debt. Upon
request, Pruco Life of New Jersey will tell a Contract owner the cash surrender
value of his or her Contract. It is possible, although highly unlikely, that the
cash surrender value of a Contract could decline to zero because of unfavorable
investment performance, even if a Contract owner continues to pay Scheduled
Premiums when due.

HOW A CONTRACT'S DEATH BENEFIT WILL VARY

The death benefit will change from the outset with investment experience. The
precise way in which that will occur is complicated and is described in the
Statement of Additional Information. In general, and assuming the optional
paid-up benefit is not in effect, see PAID-UP INSURANCE OPTION, page 16, if the
net investment performance is 4% per year or higher, the death benefit will
increase; if it is below 4%, it will decrease. Pruco Life of New Jersey
guarantees, however, that it will not decrease below the face amount of
insurance. If unfavorable experience of that kind should occur, it must be
offset by favorable experience before the death benefit begins to increase
again.

CONTRACT LOANS

The owner may borrow from Pruco Life of New Jersey up to the "loan value" of the
Contract, using the Contract as the only security for the loan. The loan value
is equal to (1) 90% of an amount equal to the portion of the Contract Fund value
attributable to the variable investment options and to any prior loan[s]
supported by the variable investment options, minus the portion of any charges
attributable to variable investment options that would be payable upon an
immediate surrender; plus (2) 100% of an amount equal to the portion of the
Contract Fund value attributable to the fixed-rate option and to any prior
loan[s] supported by the fixed-rate option, minus the portion of any charges
attributable to the fixed-rate option that would be payable upon an immediate
surrender. The minimum amount that may be borrowed at any one time is $200
unless the proceeds are used to pay premiums on the Contract.

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<PAGE>

Interest charged on a loan accrues daily at a fixed effective annual rate of
5.5%. Interest payments on any loan are due at the end of each Contract year. If
interest is not paid when due, it is added to the principal amount of the loan.
The term "Contract debt" means the amount of all outstanding loans plus any
interest accrued but not yet due. If at any time the Contract debt exceeds what
the cash surrender value would be if there were no Contract debt, Pruco Life of
New Jersey will notify you of its intent to terminate the Contract in 61 days,
within which time you may repay all or enough of the loan to obtain a positive
cash surrender value and thus keep the Contract in force for a limited time. If
you fail to keep the Contract in force, the amount of unpaid Contract debt will
be treated as a distribution which may be taxable. See TAX TREATMENT OF CONTRACT
BENEFITS, page 19, and LAPSE AND REINSTATEMENT, page 15 .

SURRENDER OF A CONTRACT

LAPSE AND REINSTATEMENT

As has already been explained, if Scheduled Premiums are paid on or before each
due date, or within the grace period after each due date, and there are no
withdrawals, a Contract will remain in force even if the investment results of
that Contract's variable investment option[s] have been so unfavorable that the
Contract Fund has decreased to zero or less.

However, if a Scheduled Premium is not paid, and the Contract Fund is
insufficient to keep the Contract in force, the Contract will go into default.
Should this happen, Pruco Life of New Jersey will send you a notice of default
setting forth the payment necessary to keep the Contract in force on a premium
paying basis. This payment must be received at a Home Office within the 61 day
grace period after the notice of default is mailed or the Contract

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<PAGE>

will lapse. A Contract that lapses with an outstanding Contract loan may have
tax consequences. See TAX TREATMENT OF CONTRACT BENEFITS, page 19.

A Contract that has lapsed may be reinstated within 5 years after the date of
default unless the Contract has been surrendered for its cash surrender value.
To reinstate a lapsed Contract, Pruco Life of New Jersey requires renewed
evidence of insurability, and submission of certain payments due under the
Contract.

If your Contract does lapse, it will still provide some benefits. You can
receive the cash surrender value by making a request of Pruco Life of New Jersey
prior to the end of the 61 day grace period. You may also choose one of the
three forms of insurance described below for which no further premiums are
payable.

Variable reduced paid-up insurance is the automatic option provided upon lapse,
if the amount of variable reduced paid-up insurance is at least as great as the
amount of fixed extended term insurance which would have been provided upon
lapse. Variable reduced paid-up insurance will be available only if the insured
is not in one of the high risk rating classes for which Pruco Life of New Jersey
does not offer fixed extended term insurance. It is possible for this Contract
to be classified as a Modified Endowment Contract if this option is exercised
during the first 7 Contract years. See TAX TREATMENT OF CONTRACT BENEFITS, page
19.

PAID-UP INSURANCE OPTION

In certain circumstances you may elect to stop paying premiums and to have
guaranteed insurance coverage for the lifetime of the insured. This benefit is
available only if the following conditions are met: (1) the Contract is not in
default; (2) Pruco Life of New Jersey is not paying premiums in accordance with
any payment of premium benefit that may be included in the Contract; and (3) the
Contract Fund is sufficiently large so that the calculated guaranteed paid-up
insurance amount is at least equal to the face amount of insurance plus the
excess, if any, of the Contract Fund over the tabular Contract Fund. The amount
of guaranteed paid-up insurance coverage may be greater. It will be equal to the
difference between the Contract Fund and the present value of future monthly
charges from the Contract Fund (other than charges for anticipated mortality
costs and for payment of premium riders) multiplied by the attained age factor.
This option will generally be available only when the Contract has been in force
for many years and the Contract Fund has grown because of favorable investment
experience or the payment of unscheduled premiums or both. Once the paid-up
insurance option is exercised, the actual death benefit is equal to the greater
of the guaranteed paid-up insurance amount and the Contract Fund multiplied by
the attained age factor. Upon request, Pruco Life of New Jersey will quote the
amount needed to pay up the Contract and to guarantee the paid-up insurance
amount as long as a payment equal to or greater than the quoted amount is
received within two weeks of the quote. There is no guarantee if the remittance
is received within the two week period and is less than the quoted amount or if
the remittance is received outside the two week period. In this case, Pruco Life
of New Jersey will add the remittance to the Contract Fund and recalculate the
guaranteed paid-up insurance amount. If the guaranteed paid-up insurance amount
is equal to or greater than the face amount, the paid-up request will be
processed. If the guaranteed paid-up insurance amount is calculated below the
face amount, the insured will be notified that the amount is insufficient to
process the request. In some cases, the quoted amount, if paid, would increase
the death benefit by more than it increases the Contract Fund. In these

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<PAGE>

situations, underwriting might be required to accept the premium payment and to
process the paid-up request. Pruco Life of New Jersey reserves the right to
change this procedure in the future. After the first Contract year, you must
make a proper written request for the Contract to become fully paid-up and send
the Contract to a Home Office to be endorsed. If this option is exercised during
the first 7 Contract years, the Contract may be classified as a "Modified
Endowment Contract," see TAX TREATMENT OF CONTRACT BENEFITS, page 19. A Contract
in effect under a paid-up insurance option will have cash surrender and loan
values.

REDUCED PAID-UP INSURANCE OPTION

Like the paid-up insurance option, reduced paid-up insurance provides the
insured with lifetime insurance coverage without the payment of additional
premiums. However, reduced paid-up insurance provides insurance coverage which
is generally lower than the death benefit of the Contract. Reduced paid-up
insurance is based upon a Contract's current net cash value and can be requested
at any time. This option is available only when the Contract is not in default
and Pruco Life of New Jersey is not paying any premiums in accordance with any
payment of premium benefit that may be included in the Contract. In order to
receive reduced paid-up insurance, a Contract owner must make a proper written
request, and Pruco Life of New Jersey may request that the owner send the
Contract to a Home Office to be endorsed. Acquisition of reduced paid-up
insurance within the first 7 Contract years may result in the Contract becoming
a Modified Endowment Contract. See TAX TREATMENT OF CONTRACT BENEFITS, page 19.

WHEN PROCEEDS ARE PAID

Pruco Life of New Jersey will generally pay any death benefit, cash surrender
value, loan proceeds or withdrawal within 7 days after receipt at a Home Office
of all the documents required for such a payment. Other than the death benefit,
which is determined as of the date of death, the amount will be determined as of
the end of the valuation period in which the necessary documents are received.
However, Pruco Life of New Jersey may delay payment of proceeds from the
subaccount[s] and the variable portion of the death benefit due under the
Contract if the sale or valuation of the Account's assets is not reasonably
practicable because the New York Stock Exchange is closed for other than a
regular holiday or weekend, trading is restricted by the SEC or the SEC declares
that an emergency exists.

With respect to the amount of any cash surrender value allocated to the
fixed-rate option, and with respect to a Contract in force as fixed reduced
paid-up insurance or as extended term insurance, Pruco Life of New Jersey
expects to pay the cash surrender value promptly upon request. However, Pruco
Life of New Jersey has the right to delay payment of such cash surrender value
for up to 6 months (or a shorter period if required by applicable law). Pruco
Life of New Jersey will pay interest of at least 3% a year if it delays such a
payment for more than 30 days (or a shorter period if required by applicable
law).

LIVING NEEDS BENEFIT

Subject to state regulatory approval, the LIVING NEEDS BENEFIT allows the
Contract owner to elect to receive an accelerated payment of all or part of the
Contract's death benefit, adjusted to reflect current value, at a time when
certain special needs exist. The adjusted death benefit will always be less than
the death benefit, but will generally be greater than the Contract's cash
surrender value. The following option may be available. A Pruco Life of New
Jersey representative should be consulted as to whether additional options may
be available.

Terminal Illness Option. This option is available if the insured is diagnosed as
terminally ill with a life expectancy of 6 months or less. When satisfactory
evidence is provided, Pruco Life of New Jersey will provide an accelerated
payment of the portion of the death benefit selected by the Contract owner as a
LIVING NEEDS BENEFIT. You may (1) elect to receive the benefit in a single sum
or (2) receive equal monthly payments for 6 months. If the insured dies before
all the payments have been made, the present value of the remaining payments
will be paid to the beneficiary designated in the LIVING NEEDS BENEFIT claim
form in a single sum.

All or part of the Contract's death benefit may be accelerated under the LIVING
NEEDS BENEFIT. If the benefit is only partially accelerated, a death benefit of
at least $25,000 must remain under the Contract. Pruco Life of New Jersey
reserves the right to determine the minimum amount that may be accelerated.

No benefit will be payable if the Contract owner is required to elect it in
order to meet the claims of creditors or to obtain a government benefit. Pruco
Life of New Jersey can furnish details about the amount of LIVING NEEDS

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<PAGE>

BENEFIT that is available to an eligible Contract owner under a particular
Contract, and the adjusted premium payments that would be in effect if less than
the entire death benefit is accelerated.

The Contract owner should consider whether adding this settlement option is
appropriate in his or her given situation. Adding the LIVING NEEDS BENEFIT to
the Contract has no adverse consequences; however, electing to use it could.
With the exception of certain business-related policies, the recently enacted
Health Insurance Portability and Accountability Act of 1996 excludes from income
the LIVING NEEDS BENEFIT if the insured is terminally ill or chronically ill as
defined by the tax law (although the exclusion in the latter case may be
limited). Contract owners should consult a qualified tax advisor before electing
to receive this benefit. Receipt of a LIVING NEEDS BENEFIT payment may also
affect a Contract owner's eligibility for certain government benefits or
entitlements.

VOTING RIGHTS

As stated above, all of the assets held in the subaccounts of the Account will
be invested in shares of the corresponding portfolios of the Series Fund. Pruco
Life of New Jersey is the legal owner of those shares and as such has the right
to vote on any matter voted on at Series Fund shareholders meetings. However,
Pruco Life of New Jersey will, as required by law, vote the shares of the Series
Fund at any regular and special shareholders meetings it is required to hold in
accordance with voting instructions received from Contract owners. The Series
Fund will not hold annual shareholders meetings when not required to do so under
Maryland law or the Investment Company Act of 1940. Series Fund shares for which
no timely instructions from Contract owners are received, and any shares
attributable to general account investments of Pruco Life of New Jersey will be
voted in the same proportion as shares in the respective portfolios for which
instructions are received.

The number of shares in a portfolio for which you may give instructions is
determined by dividing the portion of your Contract Fund attributable to the
portfolio, by the value of one share of the portfolio. The number of votes for
which each Contract owner may give Pruco Life of New Jersey instructions will be
determined as of the record date chosen by the Board of Directors of the Series
Fund. Pruco Life of New Jersey will furnish Contract owners with proper forms
and proxies to enable them to give these instructions. Pruco Life of New Jersey
reserves the right to modify the manner in which the weight to be given voting
instructions is calculated where such a change is necessary to comply with
current federal regulations or interpretations of those regulations.

Pruco Life of New Jersey may, if required by state insurance regulations,
disregard voting instructions if such instructions would require shares to be
voted so as to cause a change in the sub-classification or investment objectives
of one or more of the Series Fund's portfolios, or to approve or disapprove an
investment advisory contract for the Series Fund. In addition, Pruco Life of New
Jersey itself may disregard voting instructions that would require changes in
the investment policy or investment advisor of one or more of the Series Fund's
portfolios, provided that Pruco Life of New Jersey reasonably disapproves such
changes in accordance with applicable federal regulations. If Pruco Life of New
Jersey does disregard voting instructions, it will advise Contract owners of
that action and its reasons for such action in the next annual or semi-annual
report to Contract owners.

REPORTS TO CONTRACT OWNERS

Once each Contract year (except where the Contract is in force as fixed extended
term insurance or fixed reduced paid-up insurance), you will be sent a statement
that provides certain information pertinent to your own Contract. These
statements show all transactions during the year that affected the value of your
Contract Fund, including monthly changes attributable to investment experience.
That statement will also show the current death benefit, cash surrender value,
and loan values of your Contract. On request, you will be sent a current
statement in a form similar to that of the annual statement described above, but
Pruco Life of New Jersey may limit the number of such requests or impose a
reasonable charge if such requests are made too frequently.

You will also be sent annual and semi-annual reports of the Series Fund showing
the financial condition of the portfolios and the investments held in both.

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<PAGE>

TAX TREATMENT OF CONTRACT BENEFITS

The tax treatment of life insurance is complex and may change. Each prospective
purchaser is urged to consult a qualified tax advisor. The following discussion
is not intended as tax advice, and it is not a complete statement of what the
effect of federal income taxes will be under all circumstances. Rather, it
provides information about how Pruco Life of New Jersey believes the tax laws
apply in the most commonly occurring circumstances. A more technical discussion
of what follows is contained in the Statement of Additional Information.

Treatment as Life Insurance. Pruco Life of New Jersey believes that the Contract
should qualify as "life insurance" under the Internal Revenue Code. This means
that: (1) except as noted below, the Contract owner should not be taxed on any
part of the Contract Fund, including additions attributable to interest or
appreciation until amounts are distributed under the Contract; and (2) the death
benefit should be excludible from the gross income of the beneficiary under
section 101(a) of the Code.

Although Pruco Life of New Jersey believes the Contract should qualify as "life
insurance" for federal tax purposes, there are uncertainties, particularly
because the Secretary of the Treasury has not yet issued permanent regulations
that bear on this question. Accordingly, we have reserved the right to make
changes -- which will be applied uniformly to all Contract owners after advance
written notice -- that we deem necessary to insure that the Contract will
continue to qualify as life insurance.

Pre-Death Distributions. The tax treatment of any distribution received by an
owner prior to an insured's death will depend upon whether the Contract is
classified as a Modified Endowment Contract.

OTHER CONTRACT PROVISIONS

There are several other Contract provisions that are of less significance to you
than those already described in detail either because they relate to options
that you may choose under the Contract but are not likely to exercise for
several years after you first purchase it or because they are of a routine
nature not likely to influence your decision to buy the Contract. These
provisions are summarized in the EXPANDED TABLE OF CONTENTS OF THE STATEMENT OF
ADDITIONAL INFORMATION, page 26 and described in greater detail in the Statement
of Additional Information.

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FURTHER INFORMATION ABOUT THE SERIES FUND

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

BALANCED PORTFOLIOS

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 15% 35% 50%
Bonds and Money Market 25% 65% 70%

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<PAGE>

The bond portion of this portfolio will be invested primarily in securities with
maturities of 2 to 10 years and ratings at the time of purchase within the four
highest grades determined by Moody's, S&P, or a similar nationally-recognized
rating service or if unrated, of comparable quality in the opinion of the
portfolio manager. However, the portfolio may purchase below-investment grade
debt. A description of corporate bond ratings is contained in the Statement of
Additional Information. Because of their shorter maturities, the value of the
notes and bonds in this portfolio will be less sensitive to changes in interest
rates than the longer-term bonds likely to be held in the Flexible Managed
Portfolio. Thus, there will be less of a risk of loss of principal, but not as
much of a likelihood for greater appreciation in value. Up to 20% of the bond
portion of this portfolio may be invested in United States currency denominated
debt securities issued outside the United States by foreign or domestic issuers.
The stock portion of this portfolio will be invested primarily in the equity
securities of major, established corporations in sound financial condition that
appear to offer attractive prospects of a total return from dividends and
capital appreciation that is superior to broadly based stock indices. The
portfolio may also invest in preferred stock, including below investment grade
preferred stock. The money market portion of the portfolio will hold high
quality money market instruments of the kind held by the Money Market Portfolio.
Moreover, when conditions dictate a temporary defensive strategy or during
temporary periods of portfolio structuring and restructuring, the Conservative
Balanced Portfolio may invest, without limit, in high quality money market
instruments of the kind held by the Money Market Portfolio. See SECURITIES IN
WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST in the Statement of
Additional Information.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
briefly under OPTIONS, FUTURES CONTRACTS AND SWAPS and SHORT SALES beginning on
page 23, and in detail in the Statement of Additional Information.

Asset Type Minimum Normal Maximum
---------- ------- ------ -------
Stocks 25% 60% 100%
Bonds 0% 40% 75%
Money Market 0% 0% 75%

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<PAGE>

Statement of Additional Information. However, up to 25% of the bond component of
this portfolio may be invested in securities having ratings at the time of
purchase of "BB", "Ba" or lower, or if not rated, of comparable quality in the
opinion of the portfolio manager, also known as high risk securities. Up to 20%
of the bond portion of this portfolio may be invested in United States currency
denominated debt securities issued outside the United States by foreign or
domestic issuers. The established company common stock component of this
portfolio will consist of the equity securities of major corporations that are
believed to be in sound financial condition. In selecting stocks of smaller
capitalization companies, the portfolio manager will concentrate on companies
with a capitalization below $5 billion that show above average profitability
(measured by return-on-equity, earnings, and dividend growth rates) with modest
price/earnings ratios. The individual equity selections for this portfolio may
tend to have more volatile market values than the equity securities selected for
the Equity Portfolio or the Conservative Balanced Portfolio. The portfolio may
also invest in preferred stock, including below investment grade preferred
stock. The money market portion of the portfolio will hold high quality money
market instruments of the kind held by the Money Market Portfolio. Moreover,
when conditions dictate a temporary defensive strategy or during temporary
periods of portfolio structuring and restructuring, the Flexible Managed
Portfolio may invest, without limit, in high quality money market instruments of
the kind held by the Money Market Portfolio. See SECURITIES IN WHICH THE MONEY
MARKET PORTFOLIO MAY CURRENTLY INVEST in the Statement of Additional
Information.

In addition, the portfolio may: (i) purchase and sell options on equity
securities, debt securities, stock indices and foreign currencies; (ii) purchase
and sell stock index, interest rate and foreign currency futures contracts and
options thereon; (iii) enter into forward foreign currency exchange contracts;
(iv) purchase securities on a when- issued or delayed delivery basis; (v) use
interest rate swaps; and (vi) make short sales. These techniques are described
briefly under OPTIONS, FUTURES CONTRACTS AND SWAPS AND SHORT SALES beginning on
page 23, and in detail in the Statement of Additional Information.

FOREIGN SECURITIES

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<PAGE>

generally less government regulation of securities exchanges, brokers, and
listed companies abroad than in the United States, and, with respect to certain
foreign countries, there is a possibility of expropriation, confiscatory
taxation or diplomatic developments which could affect investment in those
countries. If the security is denominated in foreign currency, it may be
affected by changes in currency rates and in exchange control regulations, and
costs may be incurred in connection with conversions between currencies.
Finally, in the event of a default of any foreign debt obligations, it may be
more difficult for a portfolio to obtain or to enforce a judgment against the
issuers of such securities. See FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS in
the Statement of Additional Information.

OPTIONS, FUTURES CONTRACTS AND SWAPS

Because options, futures and swaps are now used to such a limited extent, a full
description of these investments and the risks associated with them is in the
Statement of Additional Information.

SHORT SALES

The Conservative Balanced and Flexible Managed Portfolios may sell securities
they do not own in anticipation of a decline in the market value of those
securities ("short sales"). The portfolio will incur a loss as a result of the
short sale if the price of the security increases between the date of the short
sale and the date on which the portfolio replaces the borrowed security. The
portfolio will realize a gain if the security declines in price between those
dates. This result is the opposite of what one would expect from a cash purchase
of a long position in a security. The amount of any gain will be decreased, and
the amount of any loss will be increased, by the amount of any premium or
interest paid in connection with the short sale.

REPURCHASE AGREEMENTS

The portfolios may enter into repurchase agreements, subject to each portfolio's
investment limit in short-term debt obligations, whereby the seller of a
security agrees to repurchase that security from the portfolio at a mutually
agreed-upon time and price. The period of maturity is usually quite short,
possibly overnight or a few days, although it may extend over a number of
months. The resale price is in excess of the purchase price, reflecting an
agreed-upon rate of return effective for the period of time the portfolio's
money is invested in the repurchase agreement. The repurchase agreements will at
all times be fully collateralized in an amount at least equal to the resale
price. The instruments held as collateral are valued daily, and if the value of
the instruments declines, the portfolio will require additional collateral. If
the seller defaults and the value of the collateral securing the repurchase
agreement declines, the portfolio may incur a loss. Both portfolios participate
in a joint repurchase account pursuant to an order of the SEC. On a daily basis,
any uninvested cash balances of the portfolios may be aggregated and invested in
one or more repurchase agreements. Each portfolio participates in the income
earned or accrued in the joint account based on the percentage of its
investment.

REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS

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<PAGE>

in the current month with a simultaneous contract to repurchase substantially
similar securities (same type and coupon) from the same party at an agreed upon
price and date. During the roll period, the portfolio forgoes principal and
interest paid on the securities. A portfolio is compensated by the difference
between the current sales price and the forward price for the future purchase
(often referred to as the "drop") as well as by the interest earned on the cash
proceeds of the initial sale. A "covered roll" is a specific type of dollar roll
for which there is an offsetting cash position or a cash equivalent security
position which matures on or before the forward settlement date of the dollar
roll transaction. A portfolio will establish a segregated account with its
custodian in which it will maintain cash, U.S. Government securities or other
liquid unencumbered assets equal in value to its obligations in respect of
reverse repurchase agreements and dollar rolls. Reverse repurchase agreements
and dollar rolls involve the risk that the market value of the securities
retained by the portfolio may decline below the price of the securities the
portfolio has sold but is obligated to repurchase under the agreement. In the
event the buyer of securities under a reverse repurchase agreement or dollar
roll files for bankruptcy or becomes insolvent, the portfolio's use of the
proceeds of the agreement may be restricted pending a determination by the other
party, or its trustee or receiver, whether to enforce the portfolio's obligation
to repurchase the securities. No portfolio will obligate more than 30% of its
net assets in connection with reverse repurchase agreements and dollar rolls.

LOANS OF PORTFOLIO SECURITIES

INVESTMENT RESTRICTIONS APPLICABLE TO THE
PORTFOLIOS

The Series Fund is subject to certain investment restrictions which are
fundamental to the operations of the Series Fund and may not be changed except
with the approval of a majority vote of the persons participating in the
affected portfolio.

A detailed discussion of investment restrictions applicable to the Series Fund
is in the Statement of Additional Information.

INVESTMENT MANAGEMENT ARRANGEMENTS AND
EXPENSES

The Series Fund has entered into an Investment Advisory Agreement with
Prudential under which Prudential will, subject to the direction of the Board of
Directors of the Series Fund, be responsible for the management of the Series
Fund, and provide investment advice and related services to each portfolio.
Prudential manages the assets that it owns as well as those of various separate
accounts established by Prudential and those held by other investment companies
for which it acts as investment advisor. Total assets under management as of
December 31, 1996 was over $XXX billion, which includes over $XXX billion owned
by Prudential and approximately $XXX billion of external assets under
Prudential's management.

Subject to Prudential's supervision, substantially all of the investment
advisory services provided to the Series Fund by Prudential, with respect to the
Conservative Balanced and Flexible Managed Portfolios, are furnished by its
wholly-owned subsidiary PIC, pursuant to the Service Agreement between
Prudential and PIC which provides that a portion of the fee received by
Prudential for providing investment advisory services will be paid to PIC. The
Conservative Balanced and Flexible Managed Portfolios are managed by PIC, using
a team of portfolio managers under the supervision of Mark Stumpp, Managing
Director, PIC. PIC is registered as an investment advisor under the Investment
Advisers Act of 1940.

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PORTFOLIO BROKERAGE AND RELATED PRACTICES

STATE REGULATION

Pruco Life of New Jersey is subject to regulation and supervision by the
Department of Insurance of the State of New Jersey, which periodically examines
its operations and financial condition. It is also subject to the insurance laws
and regulations of all jurisdictions in which it is authorized to do business.

Pruco Life of New Jersey is required to submit annual statements of its
operations, including financial statements, to the insurance departments of the
various jurisdictions in which it does business to determine solvency and
compliance with local insurance laws and regulations.

In addition to the annual statements referred to above, Pruco Life of New Jersey
is required to file with New Jersey and other jurisdictions a separate statement
with respect to the operations of all its variable contract accounts, in a form
promulgated by the National Association of Insurance Commissioners.

EXPERTS

On March 12, 1996, Deloitte & Touche LLP was dismissed as the independent
accountants of Pruco Life of New Jersey. There have been no disagreements with
Deloitte & Touche LLP on any matter of accounting principles or practices,
financial statements disclosure or auditing scope or procedure which, if not
resolved to the satisfaction of the accountant, would have caused them to make a
reference to the matter in their reports.

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<PAGE>

LITIGATION

Several actions have been brought against Pruco Life of New Jersey on behalf of
those persons who purchased life insurance policies based on complaints about
sales practices engaged in by Prudential, Pruco Life of New Jersey and agents
appointed by Prudential and Pruco Life of New Jersey. Prudential has agreed to
indemnify Pruco Life of New Jersey for any and all losses resulting from such
litigation.

EXPANDED TABLE OF CONTENTS OF STATEMENT OF
ADDITIONAL INFORMATION

Included in the registration statements for the Contracts and the Series Fund is
a Statement of Additional Information which is available without charge by
writing to Pruco Life of New Jersey at 213 Washington Street, Newark, New Jersey
07102-2992. The following table of contents of that Statement provides a brief
summary of what is included in each section.

I. MORE DETAILED INFORMATION ABOUT THE CONTRACT.

SALES LOAD UPON SURRENDER. A description is given of exactly how Pruco Life
of New Jersey determines the amount of the part of the sales load that is
imposed only upon surrenders or withdrawals during the first 10 Contract
years.

REDUCTION OF CHARGES FOR CONCURRENT SALES TO SEVERAL INDIVIDUALS. Where the
Contract is sold at the same time to several individuals who are members of
an associated class and Pruco Life of New Jersey's expenses will be
reduced, some of the charges under those Contracts may be reduced.

PAYING PREMIUMS BY PAYROLL DEDUCTION. Your employer may pay monthly
premiums for you with deductions from your salary.

UNISEX PREMIUMS AND BENEFITS. In some states and under certain
circumstances, premiums and benefits will not vary with the sex of the
insured.

HOW THE DEATH BENEFIT WILL VARY. A description is given of exactly how the
death benefit may increase to satisfy Internal Revenue Code requirements.

WITHDRAWAL OF EXCESS CASH SURRENDER VALUE. If the Contract Fund value is
high enough you may be able to withdraw part of the cash surrender value
while keeping the Contract in effect. There will be a transaction charge.
The death benefit will change. There may be tax consequences. You should
consult your Pruco Life of New Jersey representative to discuss whether a
withdrawal or a loan is preferable.

TAX TREATMENT OF CONTRACT BENEFITS. A fuller account is provided of how
Contract owners may be affected by federal income taxes.

SALE OF THE CONTRACT AND SALES COMMISSIONS. The Contract is sold primarily
by agents of Prudential who are also registered representatives of one of
its subsidiaries, Pruco Securities Corporation, a broker and dealer
registered under the Securities and Exchange Act of 1934. Generally,
selling agents receive a commission of 50% of the Scheduled Premium in the
first year, no more than 6% of the scheduled premiums for the second
through tenth years and smaller commissions thereafter.

RIDERS. Various extra fixed-benefits may be obtained for an extra premium.
They are described in what are known as "riders" to the Contract.

II. INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS.

General
Convertible Securities

Loan Participations

Warrants
Options and Futures
When-Issued and Delayed Delivery Securities
Short Sales
Short Sales Against the Box
Interest Rate Swaps

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<PAGE>

Loans of Portfolio Securities
Illiquid Securities
Forward Foreign Currency Exchange Contracts

A more detailed description is given of these investments and the policies
of these portfolios.

III. INVESTMENT RESTRICTIONS.

IV. INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES.

A fuller description than that in the prospectus is given.

V. PORTFOLIO TRANSACTIONS AND BROKERAGE.

A description is given of how securities transactions are effected and how
Prudential selects the brokers.

VI. DETERMINATION OF NET ASSET VALUE.

A full description is given of how the daily net asset value of each
portfolio is determined.

VII. SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST.

A full description is given.

VIII. DEBT RATINGS.

A description is given of how Moody's Investors Services, Inc. and Standard
& Poor's Corporation describe the creditworthiness of debt securities.

IX. POSSIBLE REPLACEMENT OF THE SERIES FUND.

Although it is most unlikely, it is conceivable that Pruco Life of New
Jersey might wish to replace the Series Fund portfolios with other
investment options. SEC approval will be needed.

X. OTHER INFORMATION CONCERNING THE SERIES FUND.

Incorporation and Authorized Stock
Dividends, Distributions and Taxes
Custodian and Transfer Agent
Experts
License

More detail is provided about these matters.

XI. DIRECTORS AND OFFICERS OF PRUCO LIFE NEW JERSEY AND MANAGEMENT OF THE
SERIES FUND.

The names and recent affiliations of Pruco Life of New Jersey's directors
and executive officers are given. The same information is given for the
Series Fund.

XII. FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.

XIII. THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS.

ADDITIONAL INFORMATION

Further information may also be obtained from Pruco Life of New Jersey. Its
address and telephone number are on the inside front cover of this prospectus.

FINANCIAL STATEMENTS

The financial statements of the Account should be distinguished from the
consolidated financial statements of Pruco Life of New Jersey which should be
considered only as bearing upon the ability of Pruco Life of New Jersey to meet
its obligations under the Contracts. The financial statements of the Series Fund
are in the Statement of Additional Information.

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<PAGE>

(This page intentionally left blank.)

28
<PAGE>

UPDATED FINANCIALS WILL BE FILED PURSUANT TO RULE 485(B)

<PAGE>

PRUVIDER(SM)

VARIABLE APPRECIABLE LIFE(R)

INSURANCE CONTRACT

[LOGO] PRUDENTIAL

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
213 Washington Street, Newark, NJ 07102-2992
Telephone 800 437-4016, Extension 46

A Subsidiary of
The Prudential Insurance Company of America

<PAGE>

PART B

INFORMATION REQUIRED IN STATEMENT
OF ADDITIONAL INFORMATION
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION

MAY 1, 1997

THE PRUDENTIAL__________________________
SERIES FUND, INC.

Shares of the Series Fund are currently sold only to separate accounts (the
"Accounts") of The Prudential Insurance Company of America ("Prudential") and
certain other insurers to fund the benefits under variable life insurance and
variable annuity contracts (the "Contracts") issued by those Companies. The
Accounts invest in shares of the Series Fund through subaccounts that correspond
to the portfolios. The Accounts will redeem shares of the Series Fund to the
extent necessary to provide benefits under the Contracts or for such other
purposes as may be consistent with the Contracts.

NOT EVERY PORTFOLIO IS AVAILABLE UNDER ALL OF THE VARIABLE CONTRACTS. THE
PROSPECTUS FOR EACH CONTRACT LISTS THE PORTFOLIOS CURRENTLY AVAILABLE UNDER THAT
PARTICULAR CONTRACT.

This statement of additional information is not a prospectus and should be read
in conjunction with the Series Fund's prospectus dated May 1, 1997, which is
available without charge upon written request to The Prudential Series Fund,
Inc., Prudential Plaza, Newark, New Jersey 07102-3777 or by telephoning (800)
445-4571.

CONTENTS

CROSS-REFERENCE TO
PAGE PAGE IN PROSPECTUS
---- ------------------
<S> <C> <C>
INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS
GENERAL............................................................................... 1 10
WARRANTS.............................................................................. 1
OPTIONS ON STOCK, OPTIONS ON DEBT SECURITIES, OPTIONS ON STOCK INDICES,
OPTIONS ON FOREIGN CURRENCIES, FUTURES CONTRACTS, AND OPTIONS ON
FUTURES CONTRACTS.................................................................. 1 31
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS........................................... 4 27
INTEREST RATE SWAPS................................................................... 6
ILLIQUID SECURITIES................................................................... 6

INVESTMENT RESTRICTIONS.................................................................. 7 34

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES.......................................... 10 34

FURTHER INFORMATION ABOUT THE ZERO COUPON BOND PORTFOLIOS................................ 11 14

OTHER INFORMATION CONCERNING THE SERIES FUND
PORTFOLIO TRANSACTIONS AND BROKERAGE.................................................. 12 38
EXPERTS............................................................................... 13
LICENSES.............................................................................. 14

MANAGEMENT OF THE SERIES FUND............................................................ 15 10

FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.................................. A1

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS................................. B1

APPENDIX: DEBT RATINGS................................................................... C1

</TABLE>

THE PRUDENTIAL SERIES FUND, INC.
Prudential Plaza
Newark, New Jersey 07102-3777
Telephone: (800) 445-4571

PSF-2 Ed 5-97 Catalog No. 646674P

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

GENERAL

The Prudential Series Fund, Inc. (the "Series Fund") is made up of fifteen
separate portfolios: the Money Market Portfolio, the Diversified Bond Portfolio,
the Government Income Portfolio, the Zero Coupon Bond Portfolios 2000 and 2005,
the Conservative Balanced Portfolio, the Flexible Managed Portfolio, the High
Yield Bond Portfolio, the Stock Index Portfolio, the Equity Income Portfolio,
the Equity Portfolio, the Prudential Jennison Portfolio, the Small
Capitalization Stock Portfolio, the Global Portfolio, and the Natural Resources
Portfolio. Not every portfolio is available under all of the variable contracts.
The prospectus for each Contract lists the portfolios currently available under
that particular Contract. The portfolios are managed by The Prudential Insurance
Company of America ("Prudential") as discussed in INVESTMENT MANAGEMENT
ARRANGEMENTS AND EXPENSES, page 10.

Each of the fifteen portfolios seeks to achieve a different investment
objective. Accordingly, each portfolio can be expected to have different
investment results and to be subject to different financial and market risks.
Financial risk refers to the ability of an issuer of a debt security to pay
principal and interest and to the earnings stability and overall financial
soundness of an issuer of an equity security. Market risk refers to the degree
to which the price of a security will react to changes in conditions in
securities markets in general, and with particular reference to debt securities,
to changes in the overall level of interest rates.

The investment objectives of the Series Fund's portfolios can be found in
INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS in the prospectus. The
policies employed to manage the Zero Coupon Bond Portfolios are discussed in
greater detail in a separate section below.

WARRANTS

The Conservative Balanced, Flexible Managed, Equity Income, Equity, Prudential
Jennison, Small Capitalization Stock, Global, and Natural Resources Portfolios
may invest in warrants on common stocks. Warrants are options to buy a number of
shares of stock at a predetermined price during a specified period. The risk
associated with the purchase of a warrant is that the purchase price will be
lost if the market price of the stock does not reach a level that justifies the
exercise or sale of the warrant before it expires. From time to time, the
Diversified Bond and the High Yield Bond Portfolios may invest in debt
securities that are offered together with warrants but only when the debt
security meets the portfolio's investment criteria and the value of the warrant
is relatively very small. If the warrant later becomes valuable, it may be sold
rather than be exercised.

OPTIONS ON STOCK, OPTIONS ON DEBT SECURITIES, OPTIONS ON STOCK INDICES,
OPTIONS ON FOREIGN CURRENCIES, FUTURES CONTRACTS, AND OPTIONS ON FUTURES
CONTRACTS

A. ADDITIONAL INFORMATION REGARDING THE USE OF FUTURES AND OPTIONS BY THE
DIVERSIFIED BOND, GOVERNMENT INCOME, CONSERVATIVE BALANCED, FLEXIBLE MANAGED,
HIGH YIELD BOND, EQUITY INCOME, EQUITY, PRUDENTIAL JENNISON, SMALL
CAPITALIZATION STOCK, GLOBAL, AND NATURAL RESOURCES PORTFOLIOS.

A portfolio will write only "covered" options on stock indices. A call option is
covered if the portfolio holds a portfolio of stocks at least equal to the value
of the index times the multiplier times the number of contracts. When a
portfolio writes a call option on a broadly based stock market index, the
portfolio will segregate or put into escrow with its custodian or pledge to a
broker as collateral for the option, cash, cash equivalents or "qualified
securities" (defined below) with a market value at the time the option is
written of not less than 100% of the current index value times the multiplier
times the number of contracts. If a portfolio has written an option on an
industry or market segment index, it will segregate or put into escrow with its
custodian or pledge to a broker as collateral for the option, at least five
"qualified securities", all of which are stocks of issuers in such industry or
market segment, with a market value at the time the option is written of not
less than 100% of the current index value times the multiplier times the number
of contracts. Such stocks will include stocks which represent at least 50% of
the weighting of the industry or market segment index and will represent at
least 50% of the portfolio's holdings in that industry or market segment. No
individual security will represent more than 15% of the amount so segregated,
pledged or escrowed in the case of broadly based stock market index options or
25% of such amount in the case of industry or market segment index options. If
at the close of business on any day the market value of such qualified
securities so segregated, escrowed or pledged falls below 100% of the current
index value times the multiplier times the number of contracts, the portfolio
will so segregate, escrow or pledge an amount in cash, Treasury bills or other
high-grade short-term obligations equal in value to the difference. In addition,
when a portfolio writes a call on an index which is in-the-money at the time the
call is written, the portfolio will segregate with its custodian or pledge to
the broker as collateral, cash or U.S. Government or other liquid unencumbered
assets equal in value to the amount by which the call is in-the-money times the
multiplier times the number of

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<PAGE>

contracts. Any amount segregated pursuant to the foregoing sentence may be
applied to the portfolio's obligation to segregate additional amounts in the
event that the market value of the qualified securities falls below 100% of the
current index value times the multiplier times the number of contracts. A
"qualified security" is an equity security which is listed on a securities
exchange or listed on the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") against which the portfolio has not written a stock
call option and which has not been hedged by the portfolio by the sale of stock
index futures. However, if the portfolio holds a call on the same index as the
call written where the exercise price of the call held is equal to or less than
the exercise price of the call written or greater than the exercise price of the
call written if the difference is maintained by the portfolio in cash, Treasury
bills or other high-grade short-term obligations in a segregated account with
its custodian, it will not be subject to the requirement described in this
paragraph.

A put option is covered if: (1) the portfolio holds in a segregated account
cash, Treasury bills or other high-grade short-term debt obligations of a value
equal to the strike price times the multiplier times the number of contracts; or
(2) the portfolio holds a put on the same index as the put written where the
strike price of the put held is equal to or greater than the strike price of the
put written or less than the strike price of the put written if the difference
is maintained by the portfolio in cash, Treasury bills or other liquid
unencumbered assets in a segregated account with its custodian. In instances
involving the purchase of futures contracts by a portfolio, an amount of cash
and cash equivalents, equal to the market value of the futures contracts, will
be deposited in a segregated account with the portfolio's custodian and/or in a
margin account with a broker to collateralize the position and thereby ensure
that the use of such futures is unleveraged.

B. ADDITIONAL INFORMATION REGARDING THE USE OF FUTURES AND OPTIONS BY THE STOCK
INDEX AND SMALL CAPITALIZATION STOCK PORTFOLIOS.

As explained in the prospectus, the Stock Index Portfolio seeks to duplicate the
performance of the S&P 500 Index and the Small Capitalization Stock Portfolio
seeks to duplicate the performance of the S&P SmallCap 600 Index. The portfolios
will be as fully invested in the S&P Indices stocks as is feasible in light of
cash flow patterns and the cash requirements for efficiently investing in a unit
of the basket of stocks comprising the S&P 500 and S&P SmallCap 600 Indices,
respectively. When the portfolios do have short-term investments, they may
purchase stock index futures contracts in an effort to have the portfolio better
mimic the performance of a fully invested portfolio. When a portfolio purchases
stock index futures contracts, an amount of cash and cash equivalents, equal to
the market value of the futures contracts, will be deposited in a segregated
account with the portfolio's custodian and/or in a margin account with a broker
to collateralize the position and thereby ensure that the use of futures is
unleveraged. As with the other portfolios, the Board of Directors currently
intends to limit futures trading so that the Stock Index and Small
Capitalization Stock Portfolios will not enter into futures contracts or related
options if the aggregate initial margins and premiums exceed 5% of the fair
market value of its assets, after taking into account unrealized profits and
unrealized losses on any such contracts and options.

As an alternative to the purchase of a stock index futures contract, the
portfolio may construct synthetic positions involving options on stock indices
and options on stock index futures that are equivalent to such a long futures
position. In particular, the portfolio may utilize "put/call combinations" as
synthetic long stock index futures positions. A put/call combination is the
simultaneous purchase of a call and the sale of a put with the same strike price
and maturity. It is equivalent to a forward position and, if settled every day,
is equivalent to a long futures position. When constructing put/call
combinations, the portfolio will segregate cash or cash equivalents in a
segregated account equal to the market value of the portfolio's forward position
to collateralize the position and ensure that it is unleveraged.

C. RISKS OF TRANSACTIONS IN OPTIONS ON EQUITY AND DEBT SECURITIES.

A portfolio's use of options on equity or debt securities is subject to certain
special risks, in addition to the risk that the market value of the security
will move adversely to the portfolio's option position. An exchange-traded
option position may be closed out only on an exchange, board of trade or other
trading facility which provides a secondary market for an option of the same
series. Although these portfolios will generally purchase or write only those
exchange-traded options for which there appears to be an active secondary
market, there is no assurance that a liquid secondary market on an exchange will
exist for any particular option, or at any particular time, and for some options
no secondary market on an exchange or otherwise may exist. In such event it
might not be possible to effect closing transactions in particular options, with
the result that the portfolio would have to exercise its options in order to
realize any profit and would incur brokerage commissions upon the exercise of
such options and upon the subsequent disposition of underlying securities
acquired through the exercise of call options or upon the purchase of underlying
securities for the exercise of put options. If a portfolio as a covered call
option writer is unable to effect a closing purchase transaction in a secondary
market, it will not be able to sell the underlying security until the option
expires or it delivers the underlying security upon exercise.

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<PAGE>

Reasons for the absence of a liquid secondary market on an exchange include the
following: (i) there may be insufficient trading interest in certain options;
(ii) restrictions imposed by an exchange on opening transactions or closing
transactions or both; (iii) trading halts, suspensions or other restrictions may
be imposed with respect to particular classes or series of options or underlying
securities; (iv) unusual or unforeseen circumstances may interrupt normal
operations on an exchange; (v) the facilities of an exchange or a clearing
corporation may not at all times be adequate to handle current trading volume;
or (vi) one or more exchanges could, for economic or other reasons, decide or be
compelled at some future date to discontinue the trading of options (or a
particular class or series of options), in which event the secondary market on
that exchange (or in the class or series of options) would cease to exist,
although outstanding options on that exchange that had been issued by a clearing
corporation as a result of trades on that exchange would continue to be
exercisable in accordance with their terms. There is no assurance that higher
than anticipated trading activity or other unforeseen events might not, at
times, render certain of the facilities of any of the clearing corporations
inadequate, and thereby result in the institution by an exchange of special
procedures which may interfere with the timely execution of customers' orders.

The purchase and sale of options that result from privately negotiated
transactions with broker-dealers ("OTC options") will also be subject to certain
risks. Unlike exchange-traded options, OTC options generally do not have a
continuous liquid market. Consequently, a portfolio will generally be able to
realize the value of an OTC option it has purchased only by exercising it or
reselling it to the dealer who issued it. Similarly, when a portfolio writes an
OTC option, it generally will be able to close out the OTC option prior to its
expiration only by entering into a closing purchase transaction with the dealer
to which the portfolio originally wrote the OTC option. While the portfolios
will seek to enter into OTC options only with dealers who agree to and which are
expected to be able to be capable of entering into closing transactions with the
portfolio, there can be no assurance that the portfolio will be able to
liquidate an OTC option at a favorable price at any time prior to expiration. In
the event of insolvency of the other party, the portfolio may be unable to
liquidate an OTC option. Prudential monitors the creditworthiness of dealers
with whom the Series Fund enters into OTC option transactions under the Board of
Directors' general supervision.

D. RISKS OF TRANSACTIONS IN OPTIONS ON STOCK INDICES.

A portfolio's purchase and sale of options on stock indices will be subject to
the same risks as stock options, described in the previous section. In addition,
the distinctive characteristics of options on indices create certain risks that
are not present with stock options. Index prices may be distorted if trading of
certain stocks included in the index is interrupted. Trading in the index
options also may be interrupted in certain circumstances, such as if trading
were halted in a substantial number of stocks included in the index. If this
occurred, a portfolio would not be able to close out options which it had
purchased or written and, if restrictions on exercise were imposed, may be
unable to exercise an option it holds, which could result in substantial losses
to the portfolio. It is the policy of the portfolios to purchase or write
options only on stock indices which include a number of stocks sufficient to
minimize the likelihood of a trading halt in options on the index.

The ability to establish and close out positions on such options will be subject
to the development and maintenance of a liquid secondary market. A portfolio
will not purchase or sell any index option contract unless and until, in its
manager's opinion, the market for such options has developed sufficiently that
the risk in connection with such transactions is no greater than the risk in
connection with options on stocks.

There are certain special risks associated with writing calls on stock indices.
Because exercises of index options are settled in cash, a call writer such as a
portfolio cannot determine the amount of its settlement obligations in advance
and, unlike call writing on specific stocks, cannot precisely provide in advance
for, or cover, its potential settlement obligations by acquiring and holding the
underlying securities. However, the portfolios will follow the "cover"
procedures described in item A above.

Price movements in a portfolio's equity security portfolio probably will not
correlate precisely with movements in the level of the index and, therefore, in
writing a call on a stock index a portfolio bears the risk that the price of the
securities held by the portfolio may not increase as much as the index. In such
event, the portfolio would bear a loss on the call which is not completely
offset by movement in the price of the portfolio's equity securities. It is also
possible that the index may rise when the portfolio's securities do not rise in
value. If this occurred, the portfolio would experience a loss on the call which
is not offset by an increase in the value of its securities portfolio and might
also experience a loss in its securities portfolio. However, because the value
of a diversified securities portfolio will, over time, tend to move in the same
direction as the market, movements in the value of a portfolio's securities in
the opposite direction as the market would be likely to occur for only a short
period or to a small degree.

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<PAGE>

portfolio would be able to deliver the underlying securities in settlement, the
portfolio may have to sell part of its stock portfolio in order to make
settlement in cash, and the price of such stocks might decline before they can
be sold. This timing risk makes certain strategies involving more than one
option substantially more risky with options in stock indices than with stock
options. For example, even if an index call which a portfolio has written is
"covered" by an index call held by the portfolio with the same strike price, the
portfolio will bear the risk that the level of the index may decline between the
close of trading on the date the exercise notice is filed with the clearing
corporation and the close of trading on the date the portfolio exercises the
call it holds or the time the portfolio sells the call which in either case
would occur no earlier than the day following the day the exercise notice was
filed.

There are also certain special risks involved in purchasing put and call options
on stock indices. If a portfolio holds an index option and exercises it before
final determination of the closing index value for that day, it runs the risk
that the level of the underlying index may change before closing. If such a
change causes the exercised option to fall out-of-the-money, the portfolio will
be required to pay the difference between the closing index value and the
exercise price of the option (times the applicable multiplier) to the assigned
writer. Although the portfolio may be able to minimize the risk by withholding
exercise instructions until just before the daily cutoff time or by selling
rather than exercising an option when the index level is close to the exercise
price, it may not be possible to eliminate this risk entirely because the cutoff
times for index options may be earlier than those fixed for other types of
options and may occur before definitive closing index values are announced.

E. RISKS OF TRANSACTIONS IN OPTIONS ON FOREIGN CURRENCY.

Because there are two currencies involved, developments in either or both
countries can affect the values of options on foreign currencies. Risks include
those described in the prospectus under FOREIGN SECURITIES and OPTIONS ON
FOREIGN CURRENCIES. In addition, the quantities of currency underlying option
contracts represent odd lots in a market dominated by transactions between
banks; this can mean extra transaction costs upon exercise. Option markets may
be closed while round-the-clock interbank currency markets are open, and this
can create price and rate discrepancies.

F. RISKS OF TRANSACTIONS IN FUTURES CONTRACTS.

There are several risks associated with a portfolio's use of futures contracts
for hedging purposes. One such risk arises because of imperfect correlation
between movements in the price of the futures contract and the price of the
securities or currency that are the subject of the hedge. In the case of futures
contracts on stock or interest rate indices, the correlation between the price
of the futures contract and movements in the index might not be perfect. To
compensate for differences in historical volatility, a portfolio could purchase
or sell futures contracts with a greater or lesser value than the securities or
currency it wished to hedge or purchase. In addition, temporary price
distortions in the futures market could be caused by a variety of factors.
Further, the ability of a portfolio to close out a futures position depends on a
liquid secondary market. There is no assurance that a liquid secondary market on
an exchange will exist for any particular futures contract at any particular
time. Further, each portfolio's successful use of futures contracts is to some
extent dependent on the ability of the portfolio manager to predict correctly
movements in the direction of the market, interest rates and/or currency
exchange rates.

The hours of trading of futures contracts may not conform to the hours during
which the portfolio may trade the underlying securities and/or currency. To the
extent that the futures markets close before the securities or currency markets,
significant price and rate movements can take place in the securities and/or
currency markets that cannot be reflected in the futures markets.

G. RISKS OF TRANSACTIONS IN OPTIONS ON FUTURES CONTRACTS.

Options on futures contracts are subject to risks similar to those described
above with respect to options on securities, options on stock indices, and
futures contracts. These risks include the risk that the portfolio manager may
not correctly predict changes in the market, the risk of imperfect correlation
between the option and the securities being hedged, and the risk that there
might not be a liquid secondary market for the option. There is also the risk of
imperfect correlation between the option and the underlying futures contract. If
there were no liquid secondary market for a particular option on a futures
contract, the portfolio might have to exercise an option it held in order to
realize any profit and might continue to be obligated under an option it had
written until the option expired or was exercised. If the portfolio were unable
to close out an option it had written on a futures contract, it would continue
to be required to maintain initial margin and make variation margin payments
with respect to the option position until the option expired or was exercised
against the portfolio.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

As explained in the prospectus, the Conservative Balanced, Flexible Managed,
Equity Income, Equity, Prudential Jennison, Global, and Natural Resources
Portfolios may purchase debt and equity securities denominated in foreign
currencies. To address the currency fluctuation risk that such investments
entail, these portfolios may enter into

4
<PAGE>

forward foreign currency exchange contracts in several circumstances. When a
portfolio enters into a contract for the purchase or sale of a security
denominated in a foreign currency, or when a portfolio anticipates the receipt
in a foreign currency of dividends or interest payments on a security which it
holds, the portfolio may desire to "lock-in" the U.S. dollar price of the
security or the U.S. dollar equivalent of such dividend or interest payment, as
the case may be. By entering into a forward contract for a fixed amount of
dollars, for the purchase or sale of the amount of foreign currency involved in
the underlying transactions, the portfolio will be able to protect itself
against a possible loss resulting from an adverse change in the relationship
between the U.S. dollar and the subject foreign currency during the period
between the date on which the security is purchased or sold, or on which the
dividend or interest payment is declared, and the date on which such payments
are made or received.

Additionally, when a portfolio's manager believes that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, the portfolio may enter into a forward contract for a fixed amount of
dollars, to sell the amount of foreign currency approximating the value of some
or all of the portfolio securities denominated in such foreign currency. The
precise matching of the forward contract amounts and the value of the securities
involved will not generally be possible since the future value of securities in
foreign currencies will change as a consequence of market movements in the value
of those securities between the date on which the forward contract is entered
into and the date it matures. The projection of short-term currency market
movement is extremely difficult, and the successful execution of a short-term
hedging strategy is highly uncertain. The portfolios will not enter into such
forward contracts or maintain a net exposure to such contracts where the
consummation of the contracts would obligate a portfolio to deliver an amount of
foreign currency in excess of the value of the securities or other assets
denominated in that currency held by the portfolio. Under normal circumstances,
consideration of the prospect for currency parities will be incorporated into
the long-term investment decisions made with regard to overall diversification
strategies. However, the portfolios believe that it is important to have the
flexibility to enter into such forward contracts when it is determined that the
best interests of the portfolios will thereby be served.

The portfolios generally will not enter into a forward contract with a term of
greater than 1 year. At the maturity of a forward contract, a portfolio may
either sell the portfolio security and make delivery of the foreign currency or
it may retain the security and terminate its contractual obligation to deliver
the foreign currency by purchasing an "offsetting" contract with the same
currency trader obligating it to purchase, on the same maturity date, the same
amount of the foreign currency.

It is impossible to forecast with absolute precision the market value of a
particular portfolio security at the expiration of the contract. Accordingly, it
may be necessary for a portfolio to purchase additional foreign currency on the
spot market (and bear the expense of such purchase) if the market value of the
security is less than the amount of foreign currency that the portfolio is
obligated to deliver and if a decision is made to sell the security and make
delivery of the foreign currency.

If a portfolio retains the portfolio security and engages in an offsetting
transaction, the portfolio will incur a gain or a loss (as described below) to
the extent that there has been movement in forward contract prices. Should
forward prices decline during the period between the portfolio's entering into a
forward contract for the sale of a foreign currency and the date it enters into
an offsetting contract for the purchase of the foreign currency, the portfolio
will realize a gain to the extent that the price of the currency it has agreed
to sell exceeds the price of the currency it has agreed to purchase. Should
forward prices increase, the portfolio will suffer a loss to the extent that the
price of the currency it has agreed to purchase exceeds the price of the
currency it has agreed to sell.

The portfolios' dealing in forward foreign currency exchange contracts will be
limited to the transactions described above. Of course, the portfolios are not
required to enter into such transactions with regard to their foreign
currency-denominated securities. It also should be realized that this method of
protecting the value of the portfolio securities against a decline in the value
of a currency does not eliminate fluctuations in the underlying prices of the
securities which are unrelated to exchange rates. Additionally, although such
contracts tend to minimize the risk of loss due to a decline in the value of the
hedged currency, at the same time they tend to limit any potential gain which
might result should the value of such currency increase.

Although the portfolios value their assets daily in terms of U.S. dollars, they
do not intend physically to convert their holdings of foreign currencies into
U.S. dollars on a daily basis. They will do so from time to time, and investors
should be aware of the costs of currency conversion. Although foreign exchange
dealers do not charge a fee for conversion, they do realize a profit based on
the difference (the "spread") between the prices at which they are buying and
selling various currencies. Thus, a dealer may offer to sell a foreign currency
to a portfolio at one rate, while offering a lesser rate of exchange should the
portfolio desire to resell that currency to the dealer.

The High Yield Bond Portfolio may also invest up to 10% of its total assets in
foreign currency denominated debt securities of foreign or domestic issuers;
however, the portfolio will not engage in such investment activity unless

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it has been first authorized to do so by the Series Fund's Board of Directors.
If the portfolio does engage in such investment activity, it may also enter into
forward foreign currency exchange contracts.

INTEREST RATE SWAPS

The Diversified Bond, Government Income, and High Yield Bond Portfolios and the
fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may use interest rate swaps subject to the limitations set forth in
the prospectus.

Interest rate swaps, in their most basic form, involve the exchange by a
portfolio with another party of their respective commitments to pay or receive
interest. For example, a portfolio might exchange its right to receive certain
floating rate payments in exchange for another party's right to receive fixed
rate payments. Interest rate swaps can take a variety of other forms, such as
agreements to pay the net differences between two different indices or rates,
even if the parties do not own the underlying instruments. Despite their
differences in form, the function of interest rate swaps is generally the same -
to increase or decrease a portfolio's exposure to long- or short-term interest
rates. For example, a portfolio may enter into a swap transaction to preserve a
return or spread on a particular investment or a portion of its portfolio or to
protect against any increase in the price of securities the portfolio
anticipates purchasing at a later date.

The use of swap agreements is subject to certain risks. As with options and
futures, if the investment manager's prediction of interest rate movements is
incorrect, the portfolio's total return will be less than if the portfolio had
not used swaps. In addition, if the counterparty's creditworthiness declines,
the value of the swap would likely decline. Moreover, there is no guarantee that
a portfolio could eliminate its exposure under an outstanding swap agreement by
entering into an offsetting swap agreement with the same or another party.

A portfolio will maintain appropriate liquid assets in a segregated custodial
account to cover its current obligations under swap agreements. If a portfolio
enters into a swap agreement on a net basis, it will segregate assets with a
daily value at least equal to the excess, if any, of the portfolio's accrued
obligations under the swap agreement over the accrued amount the portfolio is
entitled to receive under the agreement. If a portfolio enters into a swap
agreement on other than a net basis, it will segregate assets with a value equal
to the full amount of the portfolio's accrued obligations under the agreement.

ILLIQUID SECURITIES

Each portfolio, other than the Money Market Portfolio, may hold up to 15% of its
net assets in illiquid securities. The Money Market Portfolio may hold up to 10%
of its net assets in illiquid securities. Illiquid securities are those which
may not be sold in the ordinary course of business within seven days at
approximately the value at which the portfolio has valued them. Repurchase
agreements with a maturity of greater than seven days are considered illiquid.

The portfolios may purchase securities which are not registered under the
Securities Act of 1933 but which can be sold to qualified institutional buyers
in accordance with Rule 144A under that Act. Any such security will not be
considered illiquid so long as it is determined by the adviser, acting under
guidelines approved and monitored by the Board of Directors, that an adequate
trading market exists for that security. In making that determination, the
adviser will consider, among other relevant factors: (1) the frequency of trades
and quotes for the security; (2) the number of dealers willing to purchase or
sell the security and the number of other potential purchasers; (3) dealer
undertakings to make a market in the security; and (4) the nature of the
security and the nature of the marketplace trades. A portfolio's treatment of
Rule 144A securities as liquid could have the effect of increasing the level of
portfolio illiquidity to the extent that qualified institutional buyers become,
for a time, uninterested in purchasing these securities. In addition, the
adviser, acting under guidelines approved and monitored by the Board of
Directors, may conditionally determine, for purposes of the 15% test, that
certain commercial paper issued in reliance on the exemption from registration
in Section 4(2) of the Securities Act of 1933 will not be considered illiquid,
whether or not it may be resold under Rule 144A. To make that determination, the
following conditions must be met: (1) the security must not be traded flat or in
default as to principal or interest; (2) the security must be rated in one of
the two highest rating categories by at least two nationally recognized
statistical rating organizations ("NRSROs"), or if only one NRSRO rates the
security, by that NRSRO; if the security is unrated, the adviser must determine
that the security is of equivalent quality; and (3) the adviser must consider
the trading market for the specific security, taking into account all relevant
factors. The adviser will continue to monitor the liquidity of any Rule 144A
security or any Section 4(2) commercial paper which has been determined to be
liquid and, if a security is no longer liquid because of changed conditions, the
holdings of illiquid securities will be reviewed to determine if any steps are
required to assure that the 15% test continues to be satisfied.

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INVESTMENT RESTRICTIONS

Set forth below are certain investment restrictions applicable to the
portfolios. Restrictions 1, 3, 5, and 8-11 are fundamental and may not be
changed without shareholder approval as required by the 1940 Act. Restrictions
2, 4, 6, 7, and 12 are not fundamental and may be changed by the Board of
Directors without shareholder approval.

None of the portfolios will:

1. Buy or sell real estate and mortgages, although the portfolios may buy and
sell securities that are secured by real estate and securities of real
estate investment trusts and of other issuers that engage in real estate
operation. Buy or sell commodities or commodities contracts, except that
the Diversified Stock, Balanced, and Specialized Portfolios may purchase
and sell stock index futures contracts and related options; the Fixed
Income Portfolios (other than the Money Market and Zero Coupon Bond
Portfolios), the Global Portfolio, and the Balanced Portfolios may purchase
and sell interest rate futures contracts and related options; and all
portfolios (other than the Money Market, Government Income, Zero Coupon
Bond, and Small Capitalization Stock Portfolios) may purchase and sell
foreign currency futures contracts and related options and forward foreign
currency exchange contracts.

2 Except as part of a merger, consolidation, acquisition or reorganization,
invest more than 5% of the value of its total assets in the securities of
any one investment company or more than 10% of the value of its total
assets, in the aggregate, in the securities of two or more investment
companies, or acquire more than 3% of the total outstanding voting
securities of any one investment company.

3. Acquire securities for the purpose of exercising control or management of
any company except in connection with a merger, consolidation, acquisition
or reorganization.

4. Make short sales of securities or maintain a short position, except that
the Diversified Bond, High Yield Bond, Government Income, Conservative
Balanced and Flexible Managed Portfolios may sell securities short up to
25% of their net assets and except that the portfolios (other than the
Money Market and Zero Coupon Bond Portfolios) may make short sales against
the box. Collateral arrangements entered into with respect to options,
futures contracts and forward contracts are not deemed to be short sales.
Collateral arrangements entered into with respect to interest rate swap
agreements are not deemed to be short sales.

5. Purchase securities on margin or otherwise borrow money or issue senior
securities except that the Diversified Bond, High Yield Bond and Government
Income Portfolios, as well as the fixed income portions of the Balanced
Portfolios, may enter into reverse repurchase agreements, dollar rolls and
may purchase securities on a when-issued and delayed delivery basis; except
that the Money Market Portfolio and the money market portion of any
portfolio may enter into reverse repurchase agreements and may purchase
securities on a when-issued and delayed delivery basis; and except that the
Equity, Prudential Jennison, Small Capitalization Stock, Equity Income,
Natural Resources, Global, Flexible Managed and Conservative Balanced
Portfolios may purchase securities on a when-issued or a delayed delivery
basis. The Series Fund may also obtain such short-term credit as it needs
for the clearance of securities transactions and may borrow from a bank for
the account of any portfolio as a temporary measure to facilitate
redemptions (but not for leveraging or investment) or to exercise an
option, an amount that does not exceed 5% of the value of the portfolio's
total assets (including the amount owed as a result of the borrowing) at
the time the borrowing is made. Interest paid on borrowings will not be
available for investment. Collateral arrangements with respect to futures
contracts and options thereon and forward foreign currency exchange
contracts (as permitted by restriction no. 1) are not deemed to be the
issuance of a senior security or the purchase of a security on margin.
Collateral arrangements with respect to the writing of the following
options by the following portfolios are not deemed to be the issuance of a
senior security or the purchase of a security on margin: Diversified Stock
and Specialized Portfolios other than the Stock Index Portfolio (options on
equity securities, stock indices, foreign currencies) and the Small
Capitalization Stock Portfolio (options on equity securities, stock
indices); Balanced Portfolios (options on debt securities, equity
securities, stock indices, foreign currencies); Diversified Bond and High
Yield Bond Portfolios (options on debt securities, foreign currencies);
Government Income Portfolio (options on debt securities). Collateral
arrangements entered into by the Fixed Income Portfolios (other than the
Money Market and Zero Coupon Bond Portfolios) and the Balanced Portfolios
with respect to interest rate swap agreements are not deemed to be the
issuance of a senior security or the purchase of a security on margin.

7
<PAGE>

provided that the portfolio's obligations with respect to those instruments
do not exceed 30% of the portfolio's net assets (defined to mean total
assets at market value less liabilities other than reverse repurchase
agreements and dollar rolls).

7. Pledge or mortgage assets, except that no more than 10% of the value of any
portfolio may be pledged (taken at the time the pledge is made) to secure
authorized borrowing and except that a portfolio may enter into reverse
repurchase agreements. Collateral arrangements entered into with respect to
futures and forward contracts and the writing of options are not deemed to
be the pledge of assets. Collateral arrangements entered into with respect
to interest rate swap agreements are not deemed to be the pledge of assets.

8. Lend money, except that loans of up to 10% of the value of each portfolio
may be made through the purchase of privately placed bonds, debentures,
notes, and other evidences of indebtedness of a character customarily
acquired by institutional investors that may or may not be convertible into
stock or accompanied by warrants or rights to acquire stock. Repurchase
agreements and the purchase of publicly traded debt obligations are not
considered to be "loans" for this purpose and may be entered into or
purchased by a portfolio in accordance with its investment objectives and
policies.

9. Underwrite the securities of other issuers, except where the Series Fund
may be deemed to be an underwriter for purposes of certain federal
securities laws in connection with the disposition of portfolio securities
and with loans that a portfolio may make pursuant to item 8 above.

10. Make an investment unless, when considering all its other investments, 75%
of the value of a portfolio's assets would consist of cash, cash items,
obligations of the United States Government, its agencies or
instrumentalities, and other securities. For purposes of this restriction,
"other securities" are limited for each issuer to not more than 5% of the
value of a portfolio's assets and to not more than 10% of the issuer's
outstanding voting securities held by the Series Fund as a whole. Some
uncertainty exists as to whether certain of the types of bank obligations
in which a portfolio may invest, such as certificates of deposit and
bankers' acceptances, should be classified as "cash items" rather than
"other securities" for purposes of this restriction, which is a
diversification requirement under the 1940 Act. Interpreting most bank
obligations as "other securities" limits the amount a portfolio may invest
in the obligations of any one bank to 5% of its total assets. If there is
an authoritative decision that any of these obligations are not
"securities" for purposes of this diversification test, this limitation
would not apply to the purchase of such obligations.

11. Purchase securities of a company in any industry if, as a result of the
purchase, a portfolio's holdings of securities issued by companies in that
industry would exceed 25% of the value of the portfolio, except that this
restriction does not apply to purchases of obligations issued or guaranteed
by the U.S. Government, its agencies and instrumentalities or issued by
domestic banks. For purposes of this restriction, neither finance companies
as a group nor utility companies as a group are considered to be a single
industry and will be grouped instead according to their services; for
example, gas, electric, and telephone utilities will each be considered a
separate industry. For purposes of this exception, domestic banks shall
include all banks which are organized under the laws of the United States
or a state (as defined in the 1940 Act), U.S. branches of foreign banks
that are subject to the same regulations as U.S. banks and foreign branches
of domestic banks (as permitted by the SEC).

12. Invest more than 15% of its net assets in illiquid securities. (The Money
Market Portfolio will not invest more than 10% of its net assets in
illiquid securities.) For purposes of this restriction, illiquid securities
are those deemed illiquid pursuant to SEC regulations and guidelines, as
they may be revised from time to time.

The Natural Resources Portfolio will generally invest a substantial majority of
its total assets in securities of natural resource companies. With respect to
item 11 above, as it relates to the Natural Resources Portfolio, the following
categories will be considered separate and distinct industries: integrated
oil/domestic, integrated oil/international, crude oil production, natural gas
production, gas pipeline, oil service, coal, forest products, paper, foods
(including corn and wheat), tobacco, fertilizers, aluminum, copper, iron and
steel, all other basic metals (e.g., nickel, lead), gold, silver, platinum,
mining finance, plantations (e.g., edible oils), mineral sands, and diversified
resources. A company will be deemed to be in a particular industry if the
majority of its revenues is derived from or the majority of its assets is
dedicated to one of the categories described in the preceding sentence. The
Board of Directors of the Series Fund will review these industry classifications
from time to time to determine whether they are reasonable under the
circumstances and may change such classifications, without shareholder approval,
to the extent necessary.

Certain additional non-fundamental investment policies are applicable only to
the Money Market Portfolio. That portfolio will not:

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<PAGE>

1. Invest in oil and gas interests, common stock, preferred stock, warrants or
other equity securities.

2. Write or purchase any put or call option or combination of them, except
that it may purchase putable or callable securities.

3. Invest in any security with a remaining maturity in excess of 397 days,
except that securities held pursuant to repurchase agreements may have a
remaining maturity of more than 397 days.

Certain additional non-fundamental investment policies are applicable only to
the High Yield Bond Portfolio. That portfolio will not:

1. Invest in any non-fixed income equity securities, including warrants,
except when attached to or included in a unit with fixed income securities,
but not including preferred stock.

2 Invest more than 20% of the market or other fair value of its total assets
in United States currency denominated issues of foreign governments and
other foreign issuers; or invest more than 10% of the market or other fair
value of its total assets in securities which are payable in currencies
other than United States dollars. The portfolio will not engage in
investment activity in non-U.S. dollar denominated issues without first
obtaining authorization to do so from the Series Fund's Board of Directors.
See INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS, page 1.

The investments of the various portfolios are generally subject to certain
additional restrictions under the laws of the State of New Jersey. In the event
of future amendments to the applicable New Jersey statutes, each portfolio will
comply, without the approval of the shareholders, with the statutory
requirements as so modified. The pertinent provisions of New Jersey law as they
stand are, in summary form, as follows:

1. An Account may not purchase any evidence of indebtedness issued, assumed or
guaranteed by any institution created or existing under the laws of the
U.S., any U.S. state or territory, District of Columbia, Puerto Rico,
Canada or any Canadian province, if such evidence of indebtedness is in
default as to interest. "Institution" includes any corporation, joint stock
association, business trust, business joint venture, business partnership,
savings and loan association, credit union or other mutual savings
institution.

2. The stock of a corporation may not be purchased unless: (i) the corporation
has paid a cash dividend on the class of stock during each of the past 5
years preceding the time of purchase; or (ii) during the 5-year period the
corporation had aggregate earnings available for dividends on such class of
stock sufficient to pay average dividends of 4% per annum computed upon the
par value of such stock or upon stated value if the stock has no par value.
This limitation does not apply to any class of stock which is preferred as
to dividends over a class of stock whose purchase is not prohibited.

3 Any common stock purchased must be: (i) listed or admitted to trading on a
securities exchange in the United States or Canada; or (ii) included in the
National Association of Securities Dealers' national price listings of
"over-the-counter" securities; or (iii) determined by the Commissioner of
Insurance of New Jersey to be publicly held and traded and have market
quotations available.

4. Any security of a corporation may not be purchased if after the purchase
more than 10% of the market value of the assets of a portfolio would be
invested in the securities of such corporation.

As a result of these currently applicable requirements of New Jersey law, which
impose substantial limitations on the ability of the Series Fund to invest in
the stock of companies whose securities are not publicly traded or who have not
recorded a 5-year history of dividend payments or earnings sufficient to support
such payments, the portfolios will not generally hold the stock of newly
organized corporations. Nonetheless, an investment not otherwise eligible under
items 1 or 2 above may be made if, after giving effect to the investment, the
total cost of all such non-eligible investments does not exceed 5% of the
aggregate market value of the assets of the portfolio.

Investment limitations also arise under the insurance laws and regulations of
Arizona and may arise under the laws and regulations of other states. Although
compliance with the requirements of New Jersey law set forth above will
ordinarily result in compliance with any applicable laws of other states, under
some circumstances the laws of other states could impose additional restrictions
on the portfolios. For example, the Series Fund will generally invest no more
than 10% of its assets in the obligations of banks of the foreign countries
enumerated in item 2 of the Appendix to the prospectus. In addition, the Series
Fund adheres to additional restrictions relating to such practices as the
lending of securities, borrowing, and the purchase of put and call options,
futures contracts, and derivative instruments on securities to comply with
investment guidelines issued by the California Department of Insurance.

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DIVIDENDS, DISTRIBUTIONS, AND TAXES in the prospectus. Prudential intends to
maintain the assets of each portfolio pursuant to those diversification
requirements.

INVESTMENT MANAGEMENT ARRANGEMENTS
AND EXPENSES

Prudential is the investment advisor of the Series Fund. It is the largest
insurance company in the United States. The Series Fund has entered into an
Investment Advisory Agreement with Prudential under which Prudential will,
subject to the direction of the Board of Directors of the Series Fund, be
responsible for the management of the Series Fund, and provide investment advice
and related services to each portfolio. Prudential has entered into a Service
Agreement with its wholly-owned subsidiary The Prudential Investment Corporation
("PIC"), which provides that PIC will furnish to Prudential such services as
Prudential may require in connection with Prudential's performance of its
obligations under advisory agreements with clients which are registered
investment companies. In addition, Prudential has entered into a Subadvisory
Agreement with its wholly-owned subsidiary Jennison Associates Capital Corp.
("Jennison") under which Jennison furnishes investment advisory services in
connection with the management of the Prudential Jennison Portfolio. More
detailed information about Prudential and its role as investment advisor can be
found in INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES in the prospectus.

The investment management fee for the Stock Index Portfolio is equal to an
annual rate of 0.35% of the average daily net assets of the portfolio. For the
Money Market, Diversified Bond, Government Income, Zero Coupon Bond, Equity
Income, and Small Capitalization Stock Portfolios that fee is equal to an annual
rate of 0.4% of the average daily net assets of each of the portfolios. For the
Equity and Natural Resources Portfolios, the fee is equal to an annual rate of
0.45% of the average daily net assets of each of the portfolios. The fee for the
Conservative Balanced and High Yield Bond Portfolios is equal to an annual rate
of 0.55% of the average daily net assets of each of the portfolios. For the
Flexible Managed and Prudential Jennison Portfolios, the fee is equal to an
annual rate of 0.6% of the average daily net assets of the portfolio. The fee
for the Global Portfolio is equal to an annual rate of 0.75% of the average
daily net assets of the portfolio. Under the Service Agreement, Prudential pays
PIC a portion of the fee it receives for providing investment advisory services.
Prudential pays Jennison a portion of the fee it receives for providing
investment advisory services to the Prudential Jennison Portfolio.

For the years 1996, 1995, and 1994, Prudential received a total of $xx,xxx,xxx,
$77,610,207, and $66,413,206, respectively, in investment management fees for
all of the Series Fund's portfolios.

The Investment Advisory Agreement requires Prudential to pay for maintaining any
Prudential staff and personnel who perform clerical, accounting, administrative,
and similar services for the Series Fund, other than investor services and any
daily Series Fund accounting services. It also requires Prudential to pay for
the equipment, office space and related facilities necessary to perform these
services and the fees or salaries of all officers and directors of the Series
Fund who are affiliated persons of Prudential or of any subsidiary of
Prudential.

Each portfolio pays all other expenses incurred in its individual operation and
also pays a portion of the Series Fund's general administrative expenses
allocated on the basis of the asset size of the respective portfolios. Expenses
that will be borne directly by the portfolios include redemption expenses,
expenses of portfolio transactions, shareholder servicing costs, interest,
certain taxes, charges of the Custodian and Transfer Agent, and other expenses
attributable to a particular portfolio. Expenses that will be allocated among
all portfolios include legal expenses, state franchise taxes, auditing services,
costs of printing proxies, costs of stock certificates, Securities and Exchange
Commission fees, accounting costs, the fees and expenses of directors of the
Series Fund who are not affiliated persons of Prudential or any subsidiary of
Prudential, and other expenses properly payable by the entire Series Fund. If
the Series Fund is sued, litigation costs may be directly applicable to one or
more portfolio or allocated on the basis of the size of the respective
portfolios, depending upon the nature of the lawsuit. The Series Fund's Board of
Directors has determined that this is an appropriate method of allocating
expenses.

Under the Investment Advisory Agreement, Prudential has agreed to refund to a
portfolio (except the Global Portfolio) the portion of the investment management
fee for that portfolio equal to the amount that the aggregate annual ordinary
operating expenses of that portfolio (excluding interest, taxes, and brokerage
fees and commissions but including investment management fees) exceeds 0.75% of
the portfolio's average daily net assets. There is no expense limitation or
reimbursement provision for the Global Portfolio.

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<PAGE>

with respect to all portfolios. The Investment Advisory Agreement was most
recently approved by the shareholders in accordance with instructions from
Contract owners at their 1989 annual meeting with respect to all portfolios
except the Prudential Jennison and Small Capitalization Stock Portfolios. A
Supplemental Advisory Agreement regarding the Prudential Jennison and Small
Capitalization Stock Portfolios was approved by the Series Fund Board of
Directors on December 20, 1994 and by the sole shareholder of the Prudential
Jennison and Small Capitalization Stock Portfolios on April 5, 1995. The
Investment Advisory and Supplemental Investment Advisory Agreements will
continue in effect if approved annually by: (1) a majority of the non-interested
persons of the Series Fund's Board of Directors; and (2) by a majority of the
entire Board of Directors or by a majority vote of the shareholders of each
portfolio. The required shareholder approval of the Agreements shall be
effective with respect to any portfolio if a majority of the voting shares of
that portfolio vote to approve the Agreements, even if the Agreements are not
approved by a majority of the voting shares of any other portfolio or by a
majority of the voting shares of the entire Series Fund. The Agreements provide
that they may not be assigned by Prudential and that they may be terminated upon
60 days' notice by the Series Fund's Board of Directors or by a majority vote of
its shareholders. Prudential may terminate the Agreements upon 90 days' notice.

The Service Agreement between Prudential and PIC was most recently ratified by
shareholders of the Series Fund at their 1989 annual meeting with respect to all
portfolios except for the Prudential Jennison and Small Capitalization Stock
Portfolios, which had not yet been established. The Service Agreement with
respect to those portfolios and the Investment Subadvisory Agreement with
Jennison were ratified by the sole shareholder of those portfolios, April 5,
1995. The Service Agreement between Prudential and PIC will continue in effect
as to the Series Fund for a period of more than 2 years from its execution, only
so long as such continuance is specifically approved at least annually in the
same manner as the Investment Advisory Agreement between Prudential and the
Series Fund. The Service Agreement may be terminated by either party upon not
less than 30 days prior written notice to the other party, will terminate
automatically in the event of its assignment, and will terminate automatically
as to the Series Fund in the event of the assignment or termination of the
Investment Advisory Agreement between Prudential and the Series Fund. Prudential
is not relieved of its responsibility for all investment advisory services under
the Investment Advisory Agreement.

Prudential also serves as the investment advisor to several other investment
companies. When investment opportunities arise that may be appropriate for more
than one entity for which Prudential serves as investment advisor, Prudential
will not favor one over another and may allocate investments among them in an
impartial manner believed to be equitable to each entity involved. The
allocations will be based on each entity's investment objectives and its current
cash and investment positions. Because the various entities for which Prudential
acts as investment advisor have different investment objectives and positions,
Prudential may from time to time buy a particular security for one or more such
entities while at the same time it sells such securities for another.

FURTHER INFORMATION ABOUT THE
ZERO COUPON BOND PORTFOLIOS

As stated in the prospectus, the objective of Zero Coupon Bond Portfolios 2000
and 2005 is to achieve the highest predictable compounded investment return for
a specified period of time, consistent with the safety of invested capital. This
discussion provides a more detailed explanation of the investment policies that
will be employed to manage these portfolios.

If each Zero Coupon Bond Portfolio held only stripped securities that were
obligations of the United States Government, maturing on the liquidation date,
the compounded yield of the portfolio from the date of initial investment until
the liquidation date could be calculated arithmetically to a high degree of
accuracy. By: (i) including stripped corporate obligations and interest bearing
debt securities; (ii) including securities with maturity dates within 2 years of
the liquidation date; and (iii) more actively managing the portfolio, the
accuracy of the predicted yield is reduced somewhat with the objective of
achieving an increased yield. The reduction in accuracy is kept to an acceptably
small amount, however, by an investment technique known as "immunization." By
purchasing securities with maturity dates or with interest payment dates prior
to the liquidation date, a risk is incurred that the payments received will not
be able to be reinvested at interest rates as high as or higher than the yield
initially predicted. This is known as "reinvestment risk." By including
securities with maturity dates after the liquidation date, a risk is incurred
that, because interest rates have increased, the market value of such securities
will be lower than had been anticipated. This is known as "market risk." It is
also possible, conversely, that payments received prior to the liquidation date
can be reinvested at higher rates than the predicted yield and that the value of
unmatured securities on the liquidation date will be greater than anticipated.
Reinvestment risk and market risk are thus reciprocal in that any change in the
general level of interest rates has an opposite effect on the two classes of
securities described above.

11
<PAGE>

The portfolios' investment advisor seeks to balance these risks by making use of
the concept of "duration." A bond's duration is the average weighted period of
time until receipt of all scheduled cash payments under the bond (whether
principal or interest), where the weights are the present value of the amounts
to be received on each payment date. Unlike the concept of a bond's "term to
maturity," therefore, duration takes into account both the amount and timing of
a bond's interest payments, in addition to its maturity date and yield to
maturity. The duration of a zero coupon bond is the product of the face amount
of the bond and the time until maturity. As applied to a portfolio of bonds, a
portfolio's "duration" is the average weighted period of time until receipt of
all scheduled payments, whether principal or interest, from all bonds in the
portfolio.

When a portfolio's duration is equal to the length of time remaining until its
liquidation date, fluctuations in the amount of income accumulated by the
portfolio through reinvestment of coupon or principal payments received prior to
the liquidation date (i.e., fluctuations caused by reinvestment risk) will, over
the period ending on the liquidation date, be approximately equal in magnitude
to, but opposite in direction from, fluctuations in the market value on the
liquidation date of the portfolio's unmatured bonds (i.e., fluctuations caused
by market risk). By maintaining each portfolio's duration within 1 year of the
length of time remaining until its liquidation date, Prudential believes that
each portfolio's value on its liquidation date, and hence an investor's
compounded investment return to that date, will largely be immunized against
changes in the general level of interest rates. The success of this technique
could be affected, however, by such factors as changes in the relationship
between long-term and short-term interest rates and changes in the difference
between the yield on corporate and Treasury securities.

Prudential will also calculate a projected yield for each Zero Coupon Bond
Portfolio. At the beginning of each week, after the net asset value of each Zero
Coupon Bond Portfolio has been determined, Prudential will calculate the
compounded annual yield that will result if all securities in the portfolio are
held until the liquidation date or, if earlier, until their maturity dates (with
the proceeds reinvested until the liquidation date). This is the predicted yield
for that date. It can also be expressed as the amount to which a premium of
$10,000 is predicted to grow by the portfolio's liquidation date. Both of these
numbers will be furnished upon request. Unless there is a significant change in
the general level of interest rates--in which case a recalculation will be
made--the predicted yield is not likely to vary materially over the course of
each week.

As stated in the prospectus, as much as 30% of each portfolio's assets may be
invested in zero coupon debt securities issued by United States corporations or
in high grade interest bearing debt securities, provided that no more than 20%
of the assets of the portfolio may be invested in interest bearing securities.
The extent to which the portfolio invests in interest bearing securities may
rise above 20% as the portfolio moves closer to its liquidation date since both
reinvestment risk and market risk become smaller as the period to the
liquidation date decreases.

OTHER INFORMATION CONCERNING THE SERIES FUND

PORTFOLIO TRANSACTIONS AND BROKERAGE

Prudential is responsible for decisions to buy and sell securities, options on
securities and indices, and futures and related options for the Series Fund.
Prudential is also responsible for the selection of brokers, dealers, and
futures commission merchants to effect the transactions and the negotiation of
brokerage commissions, if any. Broker-dealers may receive brokerage commissions
on Series Fund portfolio transactions, including options and the purchase and
sale of underlying securities upon the exercise of options. Orders may be
directed to any broker or futures commission merchant including, to the extent
and in the manner permitted by applicable law, Prudential Securities
Incorporated, an indirect wholly-owned subsidiary of Prudential.

Equity securities traded in the over-the-counter market and bonds, including
convertible bonds, are generally traded on a "net" basis with dealers acting as
principal for their own accounts without a stated commission, although the price
of the security usually includes a profit to the dealer. In underwritten
offerings, securities are purchased at a fixed price which includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. On occasion, certain money market instruments and U.S.
Government agency securities may be purchased directly from the issuer, in which
case no commissions or discounts are paid. The Series Fund will not deal with
Prudential Securities Incorporated in any transaction in which Prudential
Securities Incorporated acts as principal. Thus, it will not deal with
Prudential Securities Incorporated if execution involves Prudential Securities
Incorporated's acting as principal with respect to any part of the Series Fund's
order.

12
<PAGE>

However, in the future it is possible that the Series Fund may under other
circumstances be at a disadvantage because of this limitation in comparison to
other funds not subject to such a limitation.

In placing orders for portfolio securities of the Series Fund, Prudential is
required to give primary consideration to obtaining the most favorable price and
efficient execution. Within the framework of this policy, Prudential will
consider the research and investment services provided by brokers, dealers or
futures commission merchants who effect or are parties to portfolio transactions
of the Series Fund, Prudential or Prudential's other clients. Such research and
investment services are those which brokerage houses customarily provide to
institutional investors and include statistical and economic data and research
reports on particular companies and industries. Such services are used by
Prudential in connection with all of its investment activities, and some of such
services obtained in connection with the execution of transactions for the
Series Fund may be used in managing other investment accounts. Conversely,
brokers, dealers or futures commission merchants furnishing such services may be
selected for the execution of transactions for such other accounts, and the
services furnished by such brokers, dealers or futures commission merchants may
be used by Prudential in providing investment management for the Series Fund.
Commission rates are established pursuant to negotiations with the broker,
dealer or futures commission merchant based on the quality and quantity of
execution services provided by the broker in the light of generally prevailing
rates. Prudential's policy is to pay higher commissions to brokers, other than
Prudential Securities Incorporated, for particular transactions than might be
charged if a different broker had been selected on occasions when, in
Prudential's opinion, this policy furthers the objective of obtaining best price
and execution. Prudential's present policy is not to permit higher commissions
to be paid on Series Fund transactions in order to secure research, statistical,
and investment services from brokers. Prudential might in the future authorize
the payment of such higher commissions but only with the prior concurrence of
the Board of Directors of the Series Fund, if it is determined that the higher
commissions are necessary in order to secure desired research and are reasonable
in relation to all the services that the broker provides.

Subject to the above considerations, Prudential Securities Incorporated may act
as a securities broker or futures commission merchant for the Series Fund. In
order for Prudential Securities Incorporated to effect any portfolio
transactions for the Series Fund, the commissions received by Prudential
Securities Incorporated must be reasonable and fair compared to the commissions
received by other brokers in connection with comparable transactions involving
similar securities being purchased or sold on a securities exchange during a
comparable period of time. This standard would allow Prudential Securities
Incorporated to receive no more than the remuneration that would be expected to
be received by an unaffiliated broker or futures commission merchant in a
commensurate arm's-length transaction. Furthermore, the Board of Directors of
the Series Fund, including a majority of the directors who are not "interested"
persons, has adopted procedures which are reasonably designed to provide that
any commissions, fees or other remuneration paid to Prudential Securities
Incorporated are consistent with the foregoing standard. In accordance with Rule
11a2-2(T) under the Securities Exchange Act of 1934, Prudential Securities
Incorporated may not retain compensation for effecting transactions on a
national securities exchange for the Series Fund unless the Series Fund has
expressly authorized the retention of such compensation in a written contract
executed by the Series Fund and Prudential Securities Incorporated. Rule
11a2-2(T) provides that Prudential Securities Incorporated must furnish to the
Series Fund at least annually a statement setting forth the total amount of all
compensation retained by Prudential Securities Incorporated from transactions
effected for the Series Fund during the applicable period. Brokerage and futures
transactions with Prudential Securities Incorporated are also subject to such
fiduciary standards as may be imposed by applicable law.

For the years 1996, 1995, and 1994, the Series Fund paid a total of $xx,xxx,xxx,
$11,607,197, and $11,579,886, respectively, in brokerage commissions. Of those
amounts, $xxx,xxx, $899,739, and $560,155, for 1996, 1995, and 1994,
respectively, was paid out to Prudential Securities Incorporated. For 1996, the
commissions paid to this affiliated broker constituted x.xx% of the total
commissions paid by the Series Fund for that year. Transactions through this
affiliated broker accounted for x.xx% of the aggregate dollar amount of
transactions for the Series Fund involving the payment of commissions.

EXPERTS

The financial statements included in this statement of additional information
and the FINANCIAL HIGHLIGHTS and PORTFOLIO RATES OF RETURN included in the
Series Fund's prospectus for the year ended December 31, 1996 have been audited
by Price Waterhouse LLP, independent accountants, as stated in their report
appearing herein and are included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing. Price Waterhouse
LLP's principal business address is 1177 Avenue of the Americas, New York, NY
10036.

13
<PAGE>

included in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing. Deloitte & Touche llp's principal business
address is Two Hilton Court, Parsippany, NJ 07054-0319.

On August 14, 1996, Deloitte & Touche LLP resigned from their position as
independent auditors of the Series Fund. There have been no disagreements with
Deloitte & Touche LLP on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure which, if not
resolved to the satisfaction of the accountant, would have caused them to make a
reference to the matter in their reports.

LICENSES

As part of the Investment Advisory Agreement, Prudential has granted the Series
Fund a royalty-free, non-exclusive license to use the words "The Prudential" and
"Prudential" and its registered service mark of a rock representing the Rock of
Gibraltar. However, Prudential may terminate this license if Prudential or a
company controlled by it ceases to be the Series Fund's investment advisor.
Prudential may also terminate the license for any other reason upon 60 days
written notice; but, in this event, the Investment Advisory Agreement shall also
terminate 120 days following receipt by the Series Fund of such notice, unless a
majority of the outstanding voting securities of the Series Fund vote to
continue the Agreement notwithstanding termination of the license.

The Series Fund is not sponsored, endorsed, sold or promoted by Standard &
Poor's ("S&P"). S&P makes no representation or warranty, express or implied, to
Contract owners or any member of the public regarding the advisability of
investing in securities generally or in the Series Fund particularly or the
ability of the S&P 500 Index or the S&P SmallCap 600 Index to track general
stock market performance. S&P's only relationship to the Series Fund is the
licensing of certain trademarks and trade names of S&P and the S&P 500 Index.
The S&P 500 Index and the S&P SmallCap 600 Index are determined, composed and
calculated by S&P without regard to the Series Fund, the Stock Index Portfolio
or the Small Capitalization Stock Portfolio. S&P has no obligation to take the
needs of the Series Fund or the Contract owners into consideration in
determining, composing or calculating the S&P 500 Index or the S&P SmallCap 600
Index. S&P is not responsible for and has not participated in the determination
of the prices and amount of the Series Fund shares or the timing of the issuance
or sale of those shares or in the determination or calculation of the equation
by which the shares are to be converted into cash. S&P has no obligation or
liability in connection with the administration, marketing or trading of the
Series Fund Shares.

S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P 500
INDEX, THE S&P SMALLCAP 600 INDEX OR ANY DATA INCLUDED THEREIN AND S&P SHALL
HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. S&P MAKES
NO WARRANTY, EXPRESS OR IMPLIED AS TO RESULTS TO BE OBTAINED BY THE SERIES FUND,
CONTRACT OWNERS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE S&P 500
INDEX, THE S&P SMALLCAP 600 INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO
EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE
S&P 500 INDEX, THE S&P SMALLCAP 600 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY LIABILITY FOR ANY
SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS),
EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

14
<PAGE>

MANAGEMENT OF THE SERIES FUND

The names of all directors and major officers of the Series Fund and the
principal occupation of each during the last 5 years are shown below. Unless
otherwise stated, the address of each director and officer is Prudential Plaza,
Newark, New Jersey 07102-3777.

DIRECTORS OF THE SERIES FUND

MENDEL A. MELZER*, Chairman of the Board--Chief Investment Officer of Prudential
Investments since 1996; 1995 to 1996: Chief Financial Officer of the Money
Management Group of Prudential; 1993 to 1995: Senior Vice President and Chief
Financial Officer of Prudential Preferred Financial Services; Prior to 1993:
Managing Director, The Prudential Investment Corporation.

E. MICHAEL CAULFIELD*, President and Director--Chief Executive Officer of
Prudential Investments since 1995; 1995: Chief Executive Officer, Prudential
Preferred Financial Services; 1993 to 1995: President, Prudential Preferred
Financial Services; 1992 to 1993: President, Prudential Property and Casualty
Insurance Company; Prior to 1992: President of Investment Services of
Prudential.

SAUL K. FENSTER, Director--President of New Jersey Institute of Technology.
Address: 323 Martin Luther King Boulevard, Newark, New Jersey 07102.

W. SCOTT McDONALD, JR., Director--Principal, Scott McDonald & Associates since
1995; Prior to 1995: Executive Vice President of Fairleigh Dickinson University.
Address: 9 Zamrok Way, Morristown, New Jersey 07960.

JOSEPH WEBER, Director--Vice President, Interclass (international corporate
learning). Address: 37 Beachmont Terrace, North Caldwell, New Jersey 07006.

OFFICERS WHO ARE NOT DIRECTORS

SUSAN COTE, Vice President--Vice President Prudential Investments since 1996;
1995 to 1996: Chief Operating Officer and Managing Director, Prudential Mutual
Fund Investment Management; Prior to 1995: Senior Vice President and Treasurer
of Prudential Mutual Funds.

THOMAS EARLY, Secretary--General Counsel, Mutual Funds and Annuities, Prudential
Investments since 1996; 1994 to 1996: General Counsel, Prudential Retirement
Services, Prudential Investments; Prior to 1994: Associate General Counsel and
Chief Financial Services Counsel, Frank Russell Company.

I. EDWARD PRICE, Vice President--Senior Vice President and Actuary, Prudential
Individual Insurance Group since 1995; 1994 to 1995: Chief Executive Officer,
Prudential International Insurance; 1993 to 1994: President, Prudential
International Insurance; Prior to 1993: Senior Vice President and Company
Actuary of Prudential.

EUGENE STARK, Comptroller, Principal Financial Officer and Treasurer--Vice
President, Prudential Investments.

No director or officer of the Series Fund who is also an officer, director or
employee of Prudential or its affiliates is entitled to any remuneration from
the Series Fund for services as one of its directors or officers. Each director
of the Series Fund who is not an interested person of the Series Fund will
receive a fee of $2,000 per year plus $200 per portfolio for each meeting of the
Board attended and will be reimbursed for all expenses incurred in connection
with attendance at meetings.

*These members of the Board are interested persons of Prudential, its affiliates
or the Series Fund as defined in the 1940 Act. Certain actions of the Board,
including the annual continuance of the Investment Advisory Agreement between
the Series Fund and Prudential, must be approved by a majority of the members of
the Board who are not interested persons of Prudential, its affiliates or the
Series Fund. Mr. Melzer and Mr. Caulfield, two of the five members of the Board,
are interested persons of Prudential and the Series Fund, as that term is
defined in the 1940 Act, because they are officers and/or affiliated persons of
Prudential, the investment advisor to the Series Fund. Messrs. Fenster,
McDonald, and Weber are not interested persons of Prudential, its affiliates or
the Series Fund. However, Mr. Fenster is President of the New Jersey Institute
of Technology. Prudential has issued a group annuity contract to the Institute
and provides group life and group health insurance to its employees.

15
<PAGE>

FINANCIAL STATEMENTS OF
THE PRUDENTIAL SERIES FUND, INC.

To be filed by Post-Effective Amendment pursuant to Rule 485(b).

<PAGE>

THE PRUDENTIAL SERIES FUND, INC.
SCHEDULE OF INVESTMENTS

To be filed by Post-Effective Amendment pursuant to Rule 485(b).

<PAGE>

APPENDIX

DEBT RATINGS

Moody's Investors Services, Inc. describes its categories of corporate debt
securities and its "Prime-1" and "Prime-2" commercial paper as follows:

Bonds:

Aaa -- Bonds which are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While
the various protective elements are likely to change, such changes as
can be visualized are most unlikely to impair the fundamentally strong
position of such issues.

Aa -- Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are
generally known as high grade bonds. They are rated lower than the
best bonds because margins of protection may not be as large as in Aaa
securities or fluctuation of protective elements may be of greater
amplitude or there may be other elements present which make the long
term risks appear somewhat larger than in Aaa securities.

A -- Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium grade obligations.
Factors giving security to principal and interest are considered
adequate but elements may be present which suggest a susceptibility to
impairment sometime in the future.

Baa -- Bonds which are rated Baa are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate for
the present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.

Ba -- Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes bonds in this class.

B -- Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or
of maintenance of other terms of the contract over any long period of
time may be small.

Caa -- Bonds which are rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to
principal or interest.

Ca -- Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have
other marked shortcomings.

Commercial paper:

o Issuers rated Prime-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1 repayment
capacity will normally be evidenced by the following characteristics:

- --Leading market positions in well-established industries.

- --High rates of return of funds employed.

- --Conservative capitalization structures with moderate reliance on debt and
ample asset protection.

- --Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

- --Well established access to a range of financial markets and assured sources of
alternate liquidity.

o Issuers rated Prime-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will normally
be evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.

C1
<PAGE>

Standard & Poor's Rating Group describes its grades of corporate debt securities
and its "A" commercial paper as follows:

Bonds:

AAA Bonds rated AAA are highest grade obligations. They possess the
ultimate degree of protection as to principal and interest. Marketwise
they move with interest rates, and hence provide the maximum safety on
all counts.

AA Bonds rated AA also qualify as high grade obligations, and in the
majority of instances differ from AAA issues only in small degree.
Here, too, prices move with the long term money market.

A Bonds rated A are regarded as upper medium grade. They have
considerable investment strength but are not entirely free from
adverse effects of changes in economic and trade conditions. Interest
and principal are regarded as safe. They predominantly reflect money
rates in their market behavior, but to some extent, also economic
conditions.

BBB The BBB, or medium grade category, is borderline between definitely
sound obligations and those where the speculative element begins to
predominate. These bonds have adequate asset coverage and normally are
protected by satisfactory earnings. Their susceptibility to changing
conditions, particularly to depressions, necessitates constant
watching. Marketwise, the bonds are more responsive to business and
trade conditions than to interest rates. This group is the lowest
which qualifies for commercial bank investment.

BB-B-CCC-CC

Bonds rated BB, B, CCC and CC are regarded, on balance, as
predominantly speculative with respect to the issuer's capacity to pay
interest and repay principal in accordance with the terms of the
obligations. BB indicates the lowest degree of speculation and CC the
highest degree of speculation. While such bonds will likely have some
quality and protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.

Commercial paper: Commercial paper rated A by Standard & Poor's Rating Group has
the following characteristics: Liquidity ratios are better than the industry
average. Long term senior debt rating is "A" or better. In some cases BBB
credits may be acceptable. The issuer has access to at least two additional
channels of borrowing. Basic earnings and cash flow have an upward trend with
allowances made for unusual circumstances. Typically, the issuer's industry is
well established, the issuer has a strong position within its industry and the
reliability and quality of management is unquestioned. Issuers rated A are
further referred to by use of numbers 1, 2 and 3 to denote relative strength
within this classification.

C2
<PAGE>

THE PRUDENTIAL___________
SERIES FUND, INC.

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
Prudential Plaza
Newark, New Jersey 07102-3777
Telephone: (800) 445-4571
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1997

THE PRUDENTIAL
SERIES FUND, INC.

THIS STATEMENT OF ADDITIONAL INFORMATION IS FOR USE ONLY WITH THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-24.

Unless otherwise indicated, this statement of additional information provides
information only with respect to the seven portfolios of the Series Fund
currently available to The Prudential Variable Contract Account-24.

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

This statement of additional information is not a prospectus and should be read
in conjunction with the Series Fund's prospectus dated May 1, 1997 that is for
use with The Prudential Variable Contract Account-24, which is available without
charge upon written request to The Prudential Insurance Company of America, c/o
Prudential Defined Contribution Services, 30 Scranton Office Park, Moosic,
Pennsylvania 18507-1789, or by telephoning 1 (800) 458-6333.

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

CONTENTS
CROSS-REFERENCE
TO PAGE
PAGE IN PROSPECTUS
---- -------------

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS
GENERAL............................................... 1 5
WARRANTS.............................................. 1
OPTIONS ON STOCK, OPTIONS ON DEBT SECURITIES,
OPTIONS ON STOCK INDICES, OPTIONS ON FOREIGN
CURRENCIES, FUTURES CONTRACTS, AND OPTIONS ON
FUTURES CONTRACTS.................................. 1 16
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS........... 4 15
INTEREST RATE SWAPS................................... 5
ILLIQUID SECURITIES................................... 6

INVESTMENT RESTRICTIONS.................................. 6 22

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES.......... 9 22

OTHER INFORMATION CONCERNING THE SERIES FUND
PORTFOLIO TRANSACTIONS AND BROKERAGE.................. 10 26
EXPERTS............................................... 11
LICENSES.............................................. 12

MANAGEMENT OF THE SERIES FUND............................ 13 5

FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.. A1

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS. B1

APPENDIX: DEBT RATINGS................................... C1

THE PRUDENTIAL SERIES FUND, INC.
Prudential Plaza
Newark, New Jersey 07102-3777
Telephone: (800) 445-4571

PSF-2A Ed 5-97

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS

GENERAL

The Prudential Variable Contract Account-24 may currently invest in seven
portfolios of The Prudential Series Fund, Inc. (the "Series Fund"): the
Diversified Bond Portfolio, the Government Income Portfolio, the Conservative
Balanced Portfolio, the Flexible Managed Portfolio, the Stock Index Portfolio,
the Equity Portfolio, and the Global Portfolio. The portfolios are managed by
The Prudential Insurance Company of America ("Prudential") as discussed in
INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES, page 9.

Each of the portfolios seeks to achieve a different investment objective.
Accordingly, each portfolio can be expected to have different investment results
and to be subject to different financial and market risks. Financial risk refers
to the ability of an issuer of a debt security to pay principal and interest and
to the earnings stability and overall financial soundness of an issuer of an
equity security. Market risk refers to the degree to which the price of a
security will react to changes in conditions in securities markets in general,
and with particular reference to debt securities, to changes in the overall
level of interest rates.

The investment objective of each of the Series Fund's seven portfolios currently
available to The Prudential Variable Contract Account-24 can be found in
INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS in the prospectus.

WARRANTS

The Conservative Balanced, Flexible Managed, Equity, and Global Portfolios may
invest in warrants on common stocks. Warrants are options to buy a number of
shares of stock at a predetermined price during a specified period. The risk
associated with the purchase of a warrant is that the purchase price will be
lost if the market price of the stock does not reach a level that justifies the
exercise or sale of the warrant before it expires. From time to time, the
Diversified Bond Portfolio may invest in debt securities that are offered
together with warrants but only when the debt security meets the portfolio's
investment criteria and the value of the warrant is relatively very small. If
the warrant later becomes valuable, it may be sold rather than be exercised.

OPTIONS ON STOCK, OPTIONS ON DEBT SECURITIES, OPTIONS ON STOCK INDICES,
OPTIONS ON FOREIGN CURRENCIES, FUTURES CONTRACTS, AND OPTIONS ON FUTURES
CONTRACTS

A. ADDITIONAL INFORMATION REGARDING THE USE OF FUTURES AND OPTIONS BY THE
DIVERSIFIED BOND, GOVERNMENT INCOME, CONSERVATIVE BALANCED, FLEXIBLE MANAGED,
EQUITY, AND GLOBAL PORTFOLIOS.

1
<PAGE>

call on the same index as the call written where the exercise price of the call
held is equal to or less than the exercise price of the call written or greater
than the exercise price of the call written if the difference is maintained by
the portfolio in cash, Treasury bills or other high-grade short-term obligations
in a segregated account with its custodian, it will not be subject to the
requirement described in this paragraph.

B. ADDITIONAL INFORMATION REGARDING THE USE OF FUTURES AND OPTIONS BY THE STOCK
INDEX PORTFOLIO.

As explained in the prospectus, the Stock Index Portfolio seeks to duplicate the
performance of the S&P 500 Index. The portfolio will be as fully invested in the
S&P 500 Index stocks as is feasible in light of cash flow patterns and the cash
requirements for efficiently investing in a unit of the basket of stocks
comprising the S&P 500 Index. When the portfolio does have short-term
investments, it may purchase stock index futures contracts in an effort to have
the portfolio better mimic the performance of a fully invested portfolio. When
the portfolio purchases stock index futures contracts, an amount of cash and
cash equivalents, equal to the market value of the futures contracts, will be
deposited in a segregated account with the portfolio's custodian and/or in a
margin account with a broker to collateralize the position and thereby ensure
that the use of futures is unleveraged. As with the other portfolios, the Board
of Directors currently intends to limit futures trading so that the Stock Index
Portfolio will not enter into futures contracts or related options if the
aggregate initial margins and premiums exceed 5% of the fair market value of its
assets, after taking into account unrealized profits and unrealized losses on
any such contracts and options.

C. RISKS OF TRANSACTIONS IN OPTIONS ON EQUITY AND DEBT SECURITIES.

2
<PAGE>

There is no assurance that higher than anticipated trading activity or other
unforeseen events might not, at times, render certain of the facilities of any
of the clearing corporations inadequate, and thereby result in the institution
by an exchange of special procedures which may interfere with the timely
execution of customers' orders.

D. RISKS OF TRANSACTIONS IN OPTIONS ON STOCK INDICES.

When a portfolio has written a call, there is also a risk that the market may
decline between the time the portfolio has a call exercised against it, at a
price which is fixed as of the closing level of the index on the date of
exercise, and the time the portfolio is able to sell stocks in its portfolio. As
with stock options, a portfolio will not learn that an index option has been
exercised until the day following the exercise date but, unlike a call on stock
where the portfolio would be able to deliver the underlying securities in
settlement, the portfolio may have to sell part of its stock portfolio in order
to make settlement in cash, and the price of such stocks might decline before
they can be sold. This timing risk makes certain strategies involving more than
one option substantially more risky with options in stock indices than with
stock options. For example, even if an index call which a portfolio has written
is "covered" by an index call held by the portfolio with the same strike price,
the portfolio will bear the risk that the level of the index may decline between
the close of trading on the date the exercise notice is filed with the clearing
corporation and the close of trading on the date the portfolio exercises the
call it holds or the time the portfolio sells the call which in either case
would occur no earlier than the day following the day the exercise notice was
filed.

3
<PAGE>

E. RISKS OF TRANSACTIONS IN OPTIONS ON FOREIGN CURRENCY.

Because there are two currencies involved, developments in either or both
countries can affect the values of options on foreign currencies. Risks include
those described in the prospectus under Foreign Securities and Options on
FOREIGN CURRENCIES. In addition, the quantities of currency underlying option
contracts represent odd lots in a market dominated by transactions between
banks; this can mean extra transaction costs upon exercise. Option markets may
be closed while round-the-clock interbank currency markets are open, and this
can create price and rate discrepancies.

F. RISKS OF TRANSACTIONS IN FUTURES CONTRACTS.

G. RISKS OF TRANSACTIONS IN OPTIONS ON FUTURES CONTRACTS.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

As explained in the prospectus, the Conservative Balanced, Flexible Managed,
Equity, and Global Portfolios may purchase debt and equity securities
denominated in foreign currencies. To address the currency fluctuation risk that
such investments entail, these portfolios may enter into forward foreign
currency exchange contracts in several circumstances. When a portfolio enters
into a contract for the purchase or sale of a security denominated in a foreign
currency, or when a portfolio anticipates the receipt in a foreign currency of
dividends or interest payments on a security which it holds, the portfolio may
desire to "lock-in" the U.S. dollar price of the security or the U.S. dollar
equivalent of such dividend or interest payment, as the case may be. By entering
into a forward contract for a fixed amount of dollars, for the purchase or sale
of the amount of foreign currency involved in the underlying transactions, the
portfolio will be able to protect itself against a possible loss resulting from
an adverse change in the relationship between the U.S. dollar and the subject
foreign currency during the period between the date on which the security is
purchased or sold, or on which the dividend or interest payment is declared, and
the date on which such payments are made or received.

4
<PAGE>

INTEREST RATE SWAPS

The Diversified Bond and Government Income Portfolios and the fixed income
portions of the Conservative Balanced and Flexible Managed Portfolios may use
interest rate swaps subject to the limitations set forth in the prospectus.

5
<PAGE>

ILLIQUID SECURITIES

Each portfolio available to The Prudential Variable Contract Account-24 may hold
up to 15% of its net assets in illiquid securities. Illiquid securities are
those which may not be sold in the ordinary course of business within seven days
at approximately the value at which the portfolio has valued them. Repurchase
agreements with a maturity of greater than seven days are considered illiquid.

INVESTMENT RESTRICTIONS

None of the portfolios available to The Prudential Variable Contract Account-24
will:

1. Buy or sell real estate and mortgages, although the portfolios may buy and
sell securities that are secured by real estate and securities of real
estate investment trusts and of other issuers that engage in real estate
operation. Buy or sell commodities or commodities contracts, except that
the Diversified Stock and Balanced Portfolios may purchase and sell stock
index futures contracts and related options; the Fixed Income Portfolios,
the Global Portfolio, and the Balanced Portfolios may purchase and sell
interest rate futures contracts and related options; and all portfolios
(other than the Government Income Portfolio) may purchase and sell foreign
currency futures contracts and related options and forward foreign currency
exchange contracts.

2. Except as part of a merger, consolidation, acquisition or reorganization,
invest more than 5% of the value of its total assets in the securities of
any one investment company or more than 10% of the value of its total
assets, in the aggregate, in the securities of two or more investment
companies, or acquire more than 3% of the total outstanding voting
securities of any one investment company.

6
<PAGE>

3. Acquire securities for the purpose of exercising control or management of
any company except in connection with a merger, consolidation, acquisition
or reorganization.

4. Make short sales of securities or maintain a short position, except that
the Diversified Bond, Government Income, Conservative Balanced and Flexible
Managed Portfolios may sell securities short up to 25% of their net assets
and except that the portfolios make short sales against the box. Collateral
arrangements entered into with respect to options, futures contracts and
forward contracts are not deemed to be short sales. Collateral arrangements
entered into with respect to interest rate swap agreements are not deemed
to be short sales.

5. Purchase securities on margin or otherwise borrow money or issue senior
securities except that the Diversified Bond and Government Income
Portfolios, as well as the fixed income portions of the Balanced
Portfolios, may enter into reverse repurchase agreements, dollar rolls and
may purchase securities on a when-issued and delayed delivery basis; except
that the money market portion of any portfolio may enter into reverse
repurchase agreements and may purchase securities on a when-issued and
delayed delivery basis; and except that the Equity, Global, Flexible
Managed and Conservative Balanced Portfolios may purchase securities on a
when-issued or a delayed delivery basis. The Series Fund may also obtain
such short-term credit as it needs for the clearance of securities
transactions and may borrow from a bank for the account of any portfolio as
a temporary measure to facilitate redemptions (but not for leveraging or
investment) or to exercise an option, an amount that does not exceed 5% of
the value of the portfolio's total assets (including the amount owed as a
result of the borrowing) at the time the borrowing is made. Interest paid
on borrowings will not be available for investment. Collateral arrangements
with respect to futures contracts and options thereon and forward foreign
currency exchange contracts (as permitted by restriction no. 1) are not
deemed to be the issuance of a senior security or the purchase of a
security on margin. Collateral arrangements with respect to the writing of
the following options by the following portfolios are not deemed to be the
issuance of a senior security or the purchase of a security on margin:
Diversified Stock Portfolios other than the Stock Index Portfolio (options
on equity securities, stock indices, foreign currencies); Stock Index
Portfolio (options on stock indices); Balanced Portfolios (options on debt
securities, equity securities, stock indices, foreign currencies);
Diversified Bond Portfolio (options on debt securities, foreign
currencies); Government Income Portfolio (options on debt securities).
Collateral arrangements entered into by the Fixed Income Portfolios and the
Balanced Portfolios with respect to interest rate swap agreements are not
deemed to be the issuance of a senior security or the purchase of a
security on margin.

6. Enter into reverse repurchase agreements if, as a result, the portfolio's
obligations with respect to reverse repurchase agreements would exceed 10%
of the portfolio's net assets (defined to mean total assets at market value
less liabilities other than reverse repurchase agreements); except that the
Diversified Bond and Government Income Portfolios, as well as the fixed
income portions of the Conservative Balanced and Flexible Managed
Portfolios, may enter into reverse repurchase agreements and dollar rolls
provided that the portfolio's obligations with respect to those instruments
do not exceed 30% of the portfolio's net assets (defined to mean total
assets at market value less liabilities other than reverse repurchase
agreements and dollar rolls).

7
<PAGE>

certain of the types of bank obligations in which a portfolio may invest,
such as certificates of deposit and bankers' acceptances, should be
classified as "cash items" rather than "other securities" for purposes of
this restriction, which is a diversification requirement under the 1940
Act. Interpreting most bank obligations as "other securities" limits the
amount a portfolio may invest in the obligations of any one bank to 5% of
its total assets. If there is an authoritative decision that any of these
obligations are not "securities" for purposes of this diversification test,
this limitation would not apply to the purchase of such obligations.

12. Invest more than 15% of its net assets in illiquid securities. For purposes
of this restriction, illiquid securities are those deemed illiquid pursuant
to SEC regulations and guidelines, as they may be revised from time to
time.

The investments of the various portfolios currently available to The Prudential
Variable Contract Account-24 are generally subject to certain additional
restrictions under the laws of the State of New Jersey. In the event of future
amendments to the applicable New Jersey statutes, each of these portfolios will
comply, without the approval of the shareholders, with the statutory
requirements as so modified. The pertinent provisions of New Jersey law as they
stand are, in summary form, as follows:

3. Any common stock purchased must be: (i) listed or admitted to trading on a
securities exchange in the United States or Canada; or (ii) included in the
National Association of Securities Dealers' national price listings of
"over-the-counter" securities; or (iii) determined by the Commissioner of
Insurance of New Jersey to be publicly held and traded and have market
quotations available.

4. Any security of a corporation may not be purchased if after the purchase
more than 10% of the market value of the assets of a portfolio would be
invested in the securities of such corporation.

8
<PAGE>

Current federal income tax laws require that the assets of each portfolio be
adequately diversified so that Prudential and other insurers with separate
accounts which invest in the Series Fund, as applicable, and not the Contract
owners, are considered the owners of assets held in the Accounts for federal
income tax purposes. See DIVIDENDS, DISTRIBUTIONS, AND TAXES in the prospectus.
Prudential intends to maintain the assets of each portfolio pursuant to those
diversification requirements.

INVESTMENT MANAGEMENT ARRANGEMENTS
AND EXPENSES

Prudential is the investment advisor of the Series Fund. It is the largest
insurance company in the United States. The Series Fund has entered into an
Investment Advisory Agreement with Prudential under which Prudential will,
subject to the direction of the Board of Directors of the Series Fund, be
responsible for the management of the Series Fund, and provide investment advice
and related services to each portfolio. Prudential has entered into a Service
Agreement with its wholly-owned subsidiary The Prudential Investment Corporation
("PIC"), which provides that PIC will furnish to Prudential such services as
Prudential may require in connection with Prudential's performance of its
obligations under advisory agreements with clients which are registered
investment companies. More detailed information about Prudential and its role as
investment advisor can be found in INVESTMENT MANAGEMENT ARRANGEMENTS AND
EXPENSES in the prospectus.

The investment management fee for the Stock Index Portfolio is equal to an
annual rate of 0.35% of the average daily net assets of the portfolio. For the
Diversified Bond and Government Income Portfolios that fee is equal to an annual
rate of 0.4% of the average daily net assets of each of the portfolios. For the
Equity Portfolio, the fee is equal to an annual rate of 0.45% of the average
daily net assets of the portfolio. The fee for the Conservative Balanced
Portfolio is equal to an annual rate of 0.55% of the average daily net assets of
the portfolio. For the Flexible Managed Portfolio, the fee is equal to an annual
rate of 0.6% of the average daily net assets of the portfolio. The fee for the
Global Portfolio is equal to an annual rate of 0.75% of the average daily net
assets of the portfolio. Under the Service Agreement, Prudential pays PIC a
portion of the fee it receives for providing investment advisory services.

For the years 1996, 1995, and 1994, Prudential received a total of $xx,xxx,xxx,
$77,610,207, and $66,413,206, respectively, in investment management fees for
all of the Series Fund's portfolios.

The Investment Advisory Agreement with Prudential was most recently approved by
the Series Fund's Board of Directors, including a majority of the Directors who
are not interested persons of Prudential, on February 12, 1997 with respect to
all portfolios available to The Prudential Variable Contract Account-24. The
Investment Advisory Agreement was most recently approved by the shareholders in
accordance with instructions from Contract owners and Participants at their 1989
annual meeting with respect to all portfolios available to The Prudential
Variable

9
<PAGE>

Contract Account-24. The Agreement will continue in effect if approved annually
by: (1) a majority of the non-interested persons of the Series Fund's Board of
Directors; and (2) by a majority of the entire Board of Directors or by a
majority vote of the shareholders of each portfolio. The required shareholder
approval of the Agreement shall be effective with respect to any portfolio if a
majority of the voting shares of that portfolio vote to approve the Agreement,
even if the Agreement is not approved by a majority of the voting shares of any
other portfolio or by a majority of the voting shares of the entire Series Fund.
The Agreement provides that it may not be assigned by Prudential and that it may
be terminated upon 60 days' notice by the Series Fund's Board of Directors or by
a majority vote of its shareholders. Prudential may terminate the Agreement upon
90 days' notice.

The Service Agreement between Prudential and PIC was most recently ratified by
shareholders of the Series Fund at their 1989 annual meeting with respect to all
portfolios available to The Prudential Variable Contract Account- 24. The
Service Agreement between Prudential and PIC will continue in effect as to the
Series Fund for a period of more than 2 years from its execution, only so long
as such continuance is specifically approved at least annually in the same
manner as the Investment Advisory Agreement between Prudential and the Series
Fund. The Service Agreement may be terminated by either party upon not less than
30 days prior written notice to the other party, will terminate automatically in
the event of its assignment, and will terminate automatically as to the Series
Fund in the event of the assignment or termination of the Investment Advisory
Agreement between Prudential and the Series Fund. Prudential is not relieved of
its responsibility for all investment advisory services under the Investment
Advisory Agreement.

OTHER INFORMATION CONCERNING THE SERIES FUND

PORTFOLIO TRANSACTIONS AND BROKERAGE

Portfolio securities may not be purchased from any underwriting or selling
syndicate of which Prudential Securities Incorporated, during the existence of
the syndicate, is a principal underwriter (as defined in the 1940 Act) except in
accordance with rules of the Securities and Exchange Commission. This
limitation, in the opinion of the Series Fund, will not significantly affect the
portfolios' current ability to pursue their respective investment objectives.
However, in the future it is possible that the Series Fund may under other
circumstances be at a disadvantage because of this limitation in comparison to
other funds not subject to such a limitation.

10
<PAGE>

obtained in connection with the execution of transactions for the Series Fund
may be used in managing other investment accounts. Conversely, brokers, dealers
or futures commission merchants furnishing such services may be selected for the
execution of transactions for such other accounts, and the services furnished by
such brokers, dealers or futures commission merchants may be used by Prudential
in providing investment management for the Series Fund. Commission rates are
established pursuant to negotiations with the broker, dealer or futures
commission merchant based on the quality and quantity of execution services
provided by the broker in the light of generally prevailing rates. Prudential's
policy is to pay higher commissions to brokers, other than Prudential Securities
Incorporated, for particular transactions than might be charged if a different
broker had been selected on occasions when, in Prudential's opinion, this policy
furthers the objective of obtaining best price and execution. Prudential's
present policy is not to permit higher commissions to be paid on Series Fund
transactions in order to secure research, statistical, and investment services
from brokers. Prudential might in the future authorize the payment of such
higher commissions but only with the prior concurrence of the Board of Directors
of the Series Fund, if it is determined that the higher commissions are
necessary in order to secure desired research and are reasonable in relation to
all the services that the broker provides.

EXPERTS

The financial statements included in this statement of additional information
and the FINANCIAL HIGHLIGHTS included in the Series Fund's prospectus for the
year ended December 31, 1996 have been audited by Price Waterhouse LLP,
independent accountants, as stated in their report appearing herein and are
included in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing. Price Waterhouse LLP's principal business
address is 1177 Avenue of the Americas, New York, NY 10036.

The financial statements included in this statement of additional information
and the FINANCIAL HIGHLIGHTS included in the Series Fund's prospectus for the
years ended prior to 1996 have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their report appearing herein and are
included in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing. Deloitte & Touche LLP's principal business
address is Two Hilton Court, Parsippany, NJ 07054-0319.

11
<PAGE>

LICENSES

The Series Fund is not sponsored, endorsed, sold or promoted by Standard &
Poor's ("S&P"). S&P makes no representation or warranty, express or implied, to
Contract owners or any member of the public regarding the advisability of
investing in securities generally or in the Series Fund particularly or the
ability of the S&P 500 Index to track general stock market performance. S&P's
only relationship to the Series Fund is the licensing of certain trademarks and
trade names of S&P and of the S&P 500 Index which is determined, composed and
calculated by S&P without regard to the Series Fund or the Stock Index
Portfolio. S&P has no obligation to take the needs of the Series Fund or the
Contract owners into consideration in determining, composing or calculating the
S&P 500 Index. S&P is not responsible for and has not participated in the
determination of the prices and amount of the Series Fund shares or the timing
of the issuance or sale of those shares or in the determination or calculation
of the equation by which the shares are to be converted into cash. S&P has no
obligation or liability in connection with the administration, marketing or
trading of the Series Fund Shares.

S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P 500 INDEX
OR ANY DATA INCLUDED THEREIN AND S&P SHALL HAVE NO LIABILITY FOR ANY ERRORS,
OMISSIONS, OR INTERRUPTIONS THEREIN. S&P MAKES NO WARRANTY, EXPRESS OR IMPLIED
AS TO RESULTS TO BE OBTAINED BY THE SERIES FUND, CONTRACT OWNERS, OR ANY OTHER
PERSON OR ENTITY FROM THE USE OF THE S&P 500 INDEX OR ANY DATA INCLUDED THEREIN.
S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH
RESPECT TO THE S&P 500 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY
OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY LIABILITY FOR ANY SPECIAL,
PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF
NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

12
<PAGE>

MANAGEMENT OF THE SERIES FUND

DIRECTORS OF THE SERIES FUND

SAUL K. FENSTER, Director--President of New Jersey Institute of Technology.
Address: 323 Martin Luther King Boulevard, Newark, New Jersey 07102.

W. SCOTT MCDONALD, JR., Director--Principal, Scott McDonald & Associates since
1995; Prior to 1995: Executive Vice President of Fairleigh Dickinson University.
Address: 9 Zamrok Way, Morristown, New Jersey 07960.

JOSEPH WEBER, Director--Vice President, Interclass (international corporate
learning). Address: 37 Beachmont Terrace, North Caldwell, New Jersey 07006.

OFFICERS WHO ARE NOT DIRECTORS

EUGENE STARK, Comptroller, Principal Financial Officer and Treasurer--Vice
President, Prudential Investments.

13
<PAGE>

FINANCIAL STATEMENTS OF
THE PRUDENTIAL SERIES FUND, INC.

To be filed by Post-Effective Amendment pursuant to Rule 485(B).

A1
<PAGE>

THE PRUDENTIAL SERIES FUND, INC.
SCHEDULE OF INVESTMENTS

To be filed by Post-Effective Amendment pursuant to Rule 485(B).

B1
<PAGE>

APPENDIX

DEBT RATINGS

Moody's Investors Services, Inc. describes its categories of corporate debt
securities and its "Prime-1" and "Prime-2" commercial paper as follows:

Bonds:

Aaa -- Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While
the various protective elements are likely to change, such changes as
can be visualized are most unlikely to impair the fundamentally strong
position of such issues.

Caa -- Bonds which are rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to
principal or interest.

Ca -- Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have
other marked shortcomings.

Commercial paper:

- --Leading market positions in well-established industries.

- --High rates of return of funds employed.

- --Conservative capitalization structures with moderate reliance on debt and
ample asset protection.

- --Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

- --Well established access to a range of financial markets and assured sources of
alternate liquidity.

C1
<PAGE>

Standard & Poor's Rating Group describes its grades of corporate debt securities
and its "A" commercial paper as follows:

Bonds:

AAA Bonds rated AAA are highest grade obligations. They possess the ultimate
degree of protection as to principal and interest. Marketwise they move
with interest rates, and hence provide the maximum safety on all counts.

AA Bonds rated AA also qualify as high grade obligations, and in the majority
of instances differ from AAA issues only in small degree. Here, too, prices
move with the long term money market.

A Bonds rated A are regarded as upper medium grade. They have considerable
investment strength but are not entirely free from adverse effects of
changes in economic and trade conditions. Interest and principal are
regarded as safe. They predominantly reflect money rates in their market
behavior, but to some extent, also economic conditions.

BBB The BBB, or medium grade category, is borderline between definitely sound
obligations and those where the speculative element begins to predominate.
These bonds have adequate asset coverage and normally are protected by
satisfactory earnings. Their susceptibility to changing conditions,
particularly to depressions, necessitates constant watching. Marketwise,
the bonds are more responsive to business and trade conditions than to
interest rates. This group is the lowest which qualifies for commercial
bank investment.

BB-B-CCC-CC Bonds rated BB, B, CCC and CC are regarded, on balance, as
predominantly speculative with respect to the issuer's capacity
to pay interest and repay principal in accordance with the terms
of the obligations. BB indicates the lowest degree of speculation
and CC the highest degree of speculation. While such bonds will
likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to
adverse conditions.

C2
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1997

PRUCO LIFE INSURANCE COMPANY
PRUVIDER VARIABLE APPRECIABLE ACCOUNT

PRUVIDER
VARIABLE
APPRECIABLE
LIFE(R)___________________

INSURANCE CONTRACTS

PROVIDING FOR THE INVESTMENT
OF ASSETS IN THE
INVESTMENT PORTFOLIOS OF

THE PRUDENTIAL SERIES
FUND, INC.

The Pruco Life Insurance Company, a stock life insurance company that is a
wholly-owned subsidiary of The Prudential Insurance Company of America, offers a
variable life insurance contract called the PRUVIDER Variable APPRECIABLE
LIFE(R) Insurance Contract*. The Contract provides whole-life insurance
protection. The death benefit varies daily with investment experience but will
never be less than the "face amount" of insurance specified in the Contract. The
Contract also generally provides a cash surrender value which also varies with
investment experience. There is no guaranteed minimum cash surrender value.

The assets held for the purpose of paying benefits under these contracts can be
invested in one or both of the two current subaccounts of the Pruco Life
PRUVIDER Variable Appreciable Account. The assets invested in each subaccount
are in turn invested in a corresponding portfolio of The Prudential Series Fund,
Inc., a diversified, open-end management investment company (commonly known as a
mutual fund) that is intended to provide a range of investment alternatives to
variable contract owners. Each portfolio is, for investment purposes, in effect
a separate fund. The two available Series Fund portfolios are the CONSERVATIVE
BALANCED PORTFOLIO and the FLEXIBLE MANAGED PORTFOLIO. A separate class of
capital stock is issued for each portfolio. Shares of the Series Fund are
currently sold only to separate accounts of Pruco Life and certain other
insurers to fund the benefits under variable life insurance and variable annuity
contracts issued by those companies.

The PRUVIDER Variable APPRECIABLE LIFE(R) Insurance Contract owner may also
choose to invest in a FIXED-RATE OPTION which is described in the prospectus of
The Pruco Life PRUVIDER Variable Appreciable Account.

----------

THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
IN CONJUNCTION WITH THE PROSPECTUS OF THE PRUCO LIFE PRUVIDER VARIABLE
APPRECIABLE ACCOUNT DATED MAY 1, 1997, WHICH IS AVAILABLE WITHOUT CHARGE UPON
WRITTEN REQUEST TO THE PRUCO LIFE INSURANCE COMPANY, 213 WASHINGTON STREET,
NEWARK, NEW JERSEY 07102-2992 OR BY TELEPHONING (800) 437-4016, Ext. 46.

----------

PRUCO LIFE INSURANCE COMPANY
213 Washington Street
Newark, New Jersey 07102-2992
Telephone: (800) 437-4016, Ext. 46

*PRUVIDER is a service mark of Prudential.
APPRECIABLE LIFE is a registered mark of Prudential.
SVAL-1SAI Ed 5-97
Catalog No. 64M086G

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
CONTENTS

Page

MORE DETAILED INFORMATION ABOUT THE CONTRACT.................................. 1
SALES LOAD UPON SURRENDER............................................ 1
REDUCTION OF CHARGES FOR CONCURRENT SALES TO SEVERAL INDIVIDUALS..... 1
PAYING PREMIUMS BY PAYROLL DEDUCTION................................. 1
UNISEX PREMIUMS AND BENEFITS......................................... 1
HOW THE DEATH BENEFIT WILL VARY...................................... 2
WITHDRAWAL OF EXCESS CASH SURRENDER VALUE............................ 2
TAX TREATMENT OF CONTRACT BENEFITS................................... 3
TREATMENT AS LIFE INSURANCE................................. 3
PRE-DEATH DISTRIBUTIONS..................................... 3
WITHHOLDING................................................. 4
OTHER TAX CONSIDERATIONS.................................... 4
SALE OF THE CONTRACT AND SALES COMMISSIONS........................... 5
RIDERS ............................................................ 5
OTHER STANDARD CONTRACT PROVISIONS................................... 5
BENEFICIARY................................................. 5
INCONTESTABILITY............................................ 5
MISSTATEMENT OF AGE OR SEX.................................. 5
SUICIDE EXCLUSION........................................... 5
ASSIGNMENT.................................................. 5
SETTLEMENT OPTIONS.......................................... 5

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS.......................... 6
GENERAL ............................................................ 6
CONVERTIBLE SECURITIES............................................... 6
LOAN PARTICIPATIONS.................................................. 6
WARRANTS ............................................................ 6
OPTIONS AND FUTURES.................................................. 6
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES......................... 13
SHORT SALES......................................................... 13
SHORT SALES AGAINST THE BOX......................................... 13
INTEREST RATE SWAPS................................................. 13
LOANS OF PORTFOLIO SECURITIES....................................... 14
ILLIQUID SECURITIES................................................. 14
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS......................... 15

INVESTMENT RESTRICTIONS...................................................... 16

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................18

PORTFOLIO TRANSACTIONS AND BROKERAGE..........................................19

DETERMINATION OF NET ASSET VALUE..............................................20

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST...........22

DEBT RATINGS..................................................................24

POSSIBLE REPLACEMENT OF THE SERIES FUND.......................................25

OTHER INFORMATION CONCERNING THE SERIES FUND..................................26
INCORPORATION AND AUTHORIZED STOCK...................................26
DIVIDENDS, DISTRIBUTIONS AND TAXES...................................26
EXPERTS ............................................................26
LICENSE ............................................................27

DIRECTORS AND OFFICERS OF PRUCO LIFE AND MANAGEMENT OF THE SERIES FUND........28

FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC...................... A1

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS..................... B1

<PAGE>

MORE DETAILED INFORMATION ABOUT THE CONTRACT

SALES LOAD UPON SURRENDER

A contingent deferred sales load is assessed if the Contract lapses or is
surrendered during the first 10 Contract years. No such charge is applicable to
the death benefit, no matter when that may become payable. Subject to the
additional limitations described below, for Contracts that lapse or are
surrendered during the first 5 Contract years the charge will be equal to 50% of
the first year's primary annual premium. In the next 5 Contract years that
percentage is reduced uniformly on a daily basis until it reaches zero on the
tenth Contract anniversary. Thus, for Contracts surrendered at the end of the
sixth year, the maximum deferred sales charge will be 40% of the first year's
primary annual premium, for Contracts surrendered at the end of year 7, the
maximum deferred sales charge will be 30% of the first year's primary annual
premium, and so forth. We are currently allowing partial surrenders of the
Contract, but we reserve the right to cancel this administrative practice. If
the Contract is partially surrendered during the first 10 years, a proportionate
amount of the charge will be deducted from the Contract Fund.

The contingent deferred sales load is also subject to a further limit at older
issue ages (approximately above age 61) in order to comply with certain
requirements of state law. Specifically, the contingent deferred sales load for
such insureds is no more than $32.50 per $1,000 of face amount.

The sales load is subject to a further important limitation that may,
particularly for Contracts that lapse or are surrendered within the first 5 or 6
years, result in a lower contingent deferred sales load than that described
above. (This limitation might also, under unusual circumstances, apply to reduce
the monthly sales load deductions described in the prospectus in item (a) under
Monthly Deductions from Contract Fund.)

The limitation is based on a Guideline Annual Premium ("GAP") that is associated
with every Contract. The GAP is an amount determined actuarially in accordance
with a definition set forth in a regulation of the Securities and Exchange
Commission ("SEC"). The maximum aggregate sales load that Pruco Life will charge
(that is, the sum of the monthly sales load deduction and the contingent
deferred sales charge) will not be more than 30% of the premiums actually paid
until those premiums total one GAP plus no more than 9% of the next premiums
paid until total premiums are equal to 5 GAPS, plus no more than 6% of all
subsequent premiums. If the sales charges described above would at any time
exceed this maximum amount then the charge, to the extent of any excess, will
not be made.

REDUCTION OF CHARGES FOR CONCURRENT SALES TO SEVERAL INDIVIDUALS

Pruco Life may reduce the sales charges and/or other charges on individual
Contracts sold to members of a class of associated individuals, or to a trustee,
employer or other entity representing such a class, where it is expected that
such multiple sales will result in savings of sales or administrative expenses.
Pruco Life determines both the eligibility for such reduced charges, as well as
the amount of such reductions, by considering the following factors: (1) the
number of individuals; (2) the total amount of premium payments expected to be
received from these Contracts; (3) the nature of the association between these
individuals, and the expected persistency of the individual Contracts; (4) the
purpose for which the individual Contracts are purchased and whether that
purpose makes it likely that expenses will be reduced; and (5) any other
circumstances which Pruco Life believes to be relevant in determining whether
reduced sales or administrative expenses may be expected. Some of the reductions
in charges for these sales may be contractually guaranteed; other reductions may
be withdrawn or modified by Pruco Life on a uniform basis. Pruco Life's
reductions in charges for these sales will not be unfairly discriminatory to the
interests of any individual Contract owners.

PAYING PREMIUMS BY PAYROLL DEDUCTION

In addition to the annual, semi-annual, quarterly and monthly premium payment
modes, a payroll budget method of paying premiums may also be available under
certain Contracts. The employer generally deducts the necessary amounts from
employee paychecks and sends premium payments to Pruco Life monthly. Any Pruco
Life representative authorized to sell this Contract can provide further details
concerning the payroll budget method of paying premiums.

UNISEX PREMIUMS AND BENEFITS

The Contract generally employs mortality tables that distinguish between males
and females. Thus, premiums and benefits under Contracts issued on males and
females of the same age will generally differ. However, in those states that
have adopted regulations prohibiting sex-distinct insurance rates, premiums and
cost of insurance charges will be based on a blended unisex rate whether the
insured is male or female. In addition, employers and employee organizations
considering purchase of a Contract should consult their legal advisors to
determine whether

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purchase of a Contract based on sex-distinct actuarial tables is consistent with
Title VII of the Civil Rights Act of 1964 or other applicable law. Pruco Life
may offer the Contract with unisex mortality rates to such prospective
purchasers.

HOW THE DEATH BENEFIT WILL VARY

The death benefit will vary with investment experience. Assuming no withdrawals,
the death benefit will be equal to the face amount of insurance plus the amount
(if any) by which the Contract Fund value exceeds the applicable "Tabular
Contract Fund value" for the Contract (subject to an exception described below
under which the death benefit is higher). Each Contract contains a table that
sets forth the Tabular Contract Fund value as of the end of each of the first 20
years of the Contract. Tabular Contract Fund values between Contract
anniversaries are determined by interpolation. The "Tabular Contract Fund value"
for each Contract year is an amount that is slightly less than the Contract Fund
value that would result as of the end of such year if only scheduled premiums
were paid, they were paid when due, the selected investment options earned a net
return at a uniform rate of 4% per year, full mortality charges based upon the
1980 CSO Table were deducted, maximum sales load and expense charges were
deducted, and there was no Contract debt.

Thus, for a Contract with no withdrawals, the death benefit will equal the face
amount if the Contract Fund equals the Tabular Contract Fund value. If, due to
investment results greater than a net return of 4%, or to payment of greater
than scheduled premiums, or to smaller than maximum charges, the Contract Fund
value is a given amount greater than the Tabular Contract Fund value, the death
benefit will be the face amount plus that excess amount. If, due to investment
results less favorable than a net return of 4%, the Contract Fund value is less
than the tabular Contract Fund value, the death benefit will not fall below the
initial face amount stated in the Contract; however, this unfavorable investment
experience must first be offset by favorable performance or additional payments
that bring the Contract Fund up to the tabular level before favorable investment
results or additional payments will increase the death benefit. Again, the death
benefit will reflect a deduction for the amount of any Contract debt. See
CONTRACT LOANS in the prospectus.

The Contract Fund could grow to the point where it is necessary to increase the
death benefit by a greater amount in order to ensure that the Contract will
satisfy the Internal Revenue Code's definition of life insurance. Thus, the
death benefit will always be the greatest of (1) the face amount plus the
Contract Fund minus the tabular Contract Fund value; (2) the guaranteed minimum
death benefit; and (3) the Contract Fund times the attained age factor that
applies.

WITHDRAWAL OF EXCESS CASH SURRENDER VALUE

Under certain circumstances, a Contract owner may withdraw a portion of the
Contract's cash surrender value without surrendering the Contract in whole or in
part. The amount that a Contract owner may withdraw is limited by the
requirement that the Contract Fund after withdrawal must not be less than the
Tabular Contract Fund value. (A Table of Tabular Contract Fund Values is
included in the Contract; the values increase with each year the Contract
remains in force.) But because the Contract Fund may be made up in part by an
outstanding Contract loan, there is a further limitation that the amount
withdrawn may not be larger than an amount sufficient to reduce the cash
surrender value to zero. The amount withdrawn must be at least $200. An owner
may make no more than four such withdrawals in each Contract year, and there is
a $15 administrative processing fee for each withdrawal. An amount withdrawn may
not be repaid except as a scheduled or unscheduled premium subject to the
applicable charges. Upon request, Pruco Life will tell a Contract owner how much
he or she may withdraw. Withdrawal of part of the cash surrender value may have
tax consequences. See Tax Treatment of Contract Benefits, page 3. A temporary
need for funds may also be met by making a loan and you should consult your
Pruco Life representative about how best to meet your needs.

When a withdrawal is made, the cash surrender value and Contract Fund value are
reduced by the amount of the withdrawal, and the death benefit is accordingly
reduced. Neither the face amount of insurance nor the amount of scheduled
premiums will be changed due to a withdrawal of excess cash surrender value. No
surrender charges will be assessed upon a withdrawal.

Withdrawal of part of the cash surrender value increases the risk that the
Contract Fund may be insufficient to provide for benefits under the Contract. If
such a withdrawal is followed by unfavorable investment experience, the Contract
may lapse even if scheduled premiums continue to be paid when due. This is
because, for purposes of determining whether a lapse has occurred, Pruco Life
treats withdrawals as a return of premium.

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TAX TREATMENT OF CONTRACT BENEFITS

Each prospective purchaser is urged to consult a qualified tax advisor. The
following discussion is not intended as tax advice, and it is not a complete
statement of what the effect of federal income taxes will be under all
circumstances. Rather, it provides information about how Pruco Life believes the
tax laws apply in the most commonly occurring circumstances. There is no
guarantee, however, that the current federal income tax laws and regulations or
interpretations will not change.

Treatment as Life Insurance. The Contract will be treated as "life insurance" as
long as it satisfies certain definitional tests set forth in Section 7702 of the
Internal Revenue Code (the "Code") and as long as the underlying investments for
the Contract satisfy diversification requirements set forth in Treasury
Regulations issued pursuant to Section 817(h) of the Code.

These diversification requirements must ordinarily be met within 1 year after
Contract owner funds are first allocated to the particular portfolio of the
Series Fund, and within 30 days after the end of each calendar quarter
thereafter. Each portfolio must meet one of two alternative tests. Under the
first test, no more than 55% of the portfolio's assets can be invested in any
one investment; no more than 70% of the assets can be invested in any two
investments; no more than 80% can be invested in any three investments; and no
more than 90% can be invested in any four investments. Under the second test,
the portfolio must meet the tax law diversification requirements for a regulated
investment company and no more than 55% of the value of the portfolio's assets
can be invested in cash, cash items, Government securities, and securities of
other regulated investment companies.

For purposes of determining whether a variable account is adequately
diversified, each United States Government agency or instrumentality is treated
as a separate issuer. Compliance with diversification requirements will
generally limit the amount of assets that may be invested in federally insured
certificates of deposit and all types of securities issued or guaranteed by each
United States Government agency or instrumentality.

Pruco Life believes that it has taken adequate steps to cause the Contract to be
treated as life insurance for tax purposes. This means that: (1) except as noted
below, the Contract owner should not be taxed on any part of the Contract Fund,
including additions attributable to interest or appreciation until amounts are
distributed under the Contract; and (2) the death benefit should be excludible
from the gross income of the beneficiary under section 101(a) of the Code.

However, Section 7702 of the Code, which defines life insurance for tax
purposes, gives the Secretary of the Treasury authority to prescribe regulations
to carry out the purposes of the Section. In this regard, proposed regulations
governing mortality charges were issued in 1991 and proposed regulations
relating to the definition of life insurance were issued in 1992. None of these
proposed regulations has yet been finalized. Additional regulations under
Section 7702 may also be promulgated in the future. Moreover, in connection with
the issuance of temporary regulations under Section 817(h), the Treasury
Department announced that such regulations do not provide guidance concerning
the extent to which Contract owners may direct their investments to particular
divisions of a separate account. Such guidance will be included in regulations
or rulings under Section 817(d) relating to the definition of a variable
contract.

Pruco Life intends to comply with final regulations issued under sections 7702
and 817. Therefore, it reserves the right to make such changes as it deems
necessary to assure that the Contract continues to qualify as life insurance for
tax purposes. Any such changes will apply uniformly to affected Contract owners
and will be made only after advance written notice to affected Contract owners.

PRE-DEATH DISTRIBUTIONS. The taxation of pre-death distributions depends on
whether the Contract is classified as a Modified Endowment Contract. The
following discussion first deals with distributions under Contracts not so
classified, and then with Modified Endowment Contracts.

1. A surrender or lapse of the Contract may have tax consequences. Upon
surrender, the owner will not be taxed on the cash surrender value except
for the amount, if any, that exceeds the gross premiums paid less the
untaxed portion of any prior withdrawals. The amount of any unpaid Contract
debt will, upon surrender or lapse, be added to the cash surrender value
and treated, for this purpose, as if it had been received. Any loss
incurred upon surrender is generally not deductible. The tax consequences
of a surrender may differ if the proceeds are received under any income
payment settlement option.

A withdrawal generally is not taxable unless it exceeds total premiums paid
to the date of withdrawal less the untaxed portion of any prior
withdrawals. However, under certain limited circumstances, in the first 15
Contract years all or a portion of a withdrawal may be taxable if the
Contract Fund exceeds the total premiums paid less the untaxed portion of
any prior withdrawals, even if total withdrawals do not exceed total
premiums paid to date.

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Extra premiums for optional benefits and riders generally do not count in
computing gross premiums paid, which in turn determines the extent to which
a withdrawal might be taxed.

Loans received under the Contract will ordinarily be treated as
indebtedness of the owner and will not be considered to be distributions
subject to tax.

2. Some of the above rules are changed if the Contract is classified as a
Modified Endowment Contract under section 7702A of the Code. A Contract may
be classified as a Modified Endowment Contract under various circumstances.
For example, low face amount Contracts issued on younger insureds may be
classified as a Modified Endowment Contract even though the Contract owner
pays only the Scheduled Premiums or even less than the Scheduled Premiums.
Before purchasing such a Contract, you should understand the tax treatment
of pre-death distributions and consider the purpose for which the Contract
is being purchased. More generally, a Contract may be classified as a
Modified Endowment Contract if premiums in excess of Scheduled Premiums are
paid or a decrease in the face amount of insurance is made (or a rider
removed) during the first 7 Contract years. Moreover, the addition of a
rider after the Contract date may have an impact on the Contract's status
as a Modified Endowment Contract. Contract owners contemplating any of
these steps should first consult a qualified tax advisor and their Pruco
Life representative.

If the Contract is classified as a Modified Endowment Contract, then
pre-death distributions, including loans and withdrawals, are includible in
income to the extent that the Contract fund prior to surrender charges
exceeds the gross premiums paid for the Contract increased by the amount of
any loans previously includible in income and reduced by any untaxed
amounts previously received other than the amount of any loans excludible
from income. These rules may also apply to pre-death distributions,
including loans, made during the 2 year period prior to the Contract
becoming a Modified Endowment Contract.

In addition, pre-death distributions from such Contracts (including full
surrenders) will be subject to a penalty of 10 percent of the amount
includible in income unless the amount is distributed on or after age 59
1/2, on account of the taxpayer's disability, or as a life annuity. It is
presently unclear how the penalty tax provisions apply to Contracts owned
by nonnatural persons such as corporations.

Under certain circumstances, Modified Endowment Contracts issued during any
calendar year will be treated as a single contract for purposes of applying
the above rules.

WITHHOLDING. The taxable portions of any amounts received under the Contract
will be subject to withholding to meet federal income tax obligations if the
Contract owner fails to elect that no taxes be withheld or in certain other
circumstances. Contract owners who do not provide a social security number or
other taxpayer identification number will not be permitted to elect out of
withholding. All recipients of such amounts may be subject to penalties under
the estimated tax rules if withholding and estimated tax payments are not
sufficient.

OTHER TAX CONSIDERATIONS. Transfer of the Contract to a new owner or assignment
of the Contract may have tax consequences depending on the circumstances. In the
case of a transfer of the Contract for a valuable consideration, the death
benefit may be subject to federal income taxes under section 101(a)(2) of the
Code. In addition, a transfer of the Contract to or the designation of a
beneficiary who is either 37 1/2 years younger than the Contract owner or a
grandchild of the Contract owner may have Generation Skipping Transfer tax
consequences under Section 2601 of the Code.

In certain circumstances, deductions for interest paid or accrued on Contract
debt or on other loans that are incurred or continued to purchase or carry the
Contract may be denied under section 163 of the Code as personal interest or
under section 264 of the Code. Contract owners should consult a tax advisor
regarding the application of these provisions to their circumstances.

Business-owned life insurance is subject to additional rules. Section 264(a)(1)
of the Code generally precludes business Contract owners from deducting premium
payments. The recently enacted Health Insurance Portability and Accountability
Act of 1996 generally disallows tax deductions for interest on Contract debt on
a business- owned insurance policy effective (with certain transitional rules)
for interest paid or accrued after October 13, 1995. An exception permits the
deduction of interest on policy loans on Contracts for up to 20 key persons. The
interest deduction for Contract debt on such loans is limited to a prescribed
interest rate and a maximum aggregate loan amount of $50,000 per key insured
person. The Code also imposes an indirect tax upon additions to the Contract
fund or the receipt of death benefits under business-owned life insurance
policies under certain circumstances by way of the corporate alternative minimum
tax.

The individual situation of each Contract owner or beneficiary will determine
the federal estate taxes and the state and local estate, inheritance and other
taxes due if the owner or insured dies.

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SALE OF THE CONTRACT AND SALES COMMISSIONS

Pruco Securities Corporation ("Prusec"), an indirect wholly-owned subsidiary of
Prudential, acts as the principal underwriter of the Contract. Prusec, organized
in 1971 under New Jersey law, is registered as a broker and dealer under the
Securities Exchange Act of 1934 and is a member of the National Association of
Securities Dealers, Inc. Prusec's principal business address is 213 Washington
Street, Newark, New Jersey 07102-2992. The Contract is sold by registered
representatives of Prusec who are also authorized by state insurance departments
to do so. The Contract may also be sold through other broker-dealers authorized
by Prusec and applicable law to do so. Registered representatives of such other
broker-dealers may be paid on a different basis than described below. Where the
insured is less than 60 years of age, the representative will generally receive
a commission of no more than 50% of the scheduled premiums for the first year,
no more than 6% of the scheduled premiums for the second through tenth years,
and no more than 2% of the scheduled premiums thereafter. For insureds over 59
years of age, the commission will be lower. The representative may be required
to return all or part of the first year commission if the Contract is not
continued through the second year. Representatives with less than 3 years of
service may be paid on a different basis.

Sales expenses in any year are not equal to the deduction for sales load in that
year. Pruco Life expects to recover its total sales expenses over the periods
the Contracts are in effect. To the extent that the sales charges are
insufficient to cover total sales expenses, the sales expenses will be recovered
from Pruco Life's surplus, which may include amounts derived from the mortality
and expense risk charge and the guaranteed minimum death benefit risk charge
described in the prospectus under DAILY DEDUCTION FROM THE CONTRACT FUND and
item (d) under MONTHLY DEDUCTIONS FROM CONTRACT FUND.

RIDERS

The Contract owner may be able to obtain extra fixed benefits which may require
an additional premium. These optional insurance benefits will be described in
what is known as a "rider" to the Contract. Charges for the riders will be
deducted from the Contract Fund on each Monthly date. One rider pays an
additional amount if the insured dies in an accident. Another waives certain
premiums if the insured is disabled within the meaning of the provision (or, in
the case of a Contract issued on an insured under the age of 15, if the
applicant dies or becomes disabled within the meaning of the provision). Others
pay an additional amount if the insured dies within a stated number of years
after issue; similar benefits may be available if the insured's child should
die. The amounts of these benefits are fully guaranteed at issue; they do not
depend on the performance of the Account. Certain restrictions may apply; they
are clearly described in the applicable rider.

Any Pruco Life representative authorized to sell the Contract can explain these
extra benefits further. Samples of the provisions are available from Pruco Life
upon written request.

OTHER STANDARD CONTRACT PROVISIONS.

BENEFICIARY. The beneficiary is designated and named in the application by the
Contract owner. Thereafter, the owner may change the beneficiary, provided it is
in accordance with the terms of the Contract. Should the insured die with no
surviving beneficiary, the insured's estate will become the beneficiary.

INCONTESTABILITY. After the Contract has been in force during the insured's
lifetime for 2 years from the Contract date or, with respect to any change in
the Contract that requires Pruco Life's approval and could increase its
liability, after the change has been in effect during the insured's lifetime for
2 years from the effective date of the change, Pruco Life will not contest its
liability under the Contract in accordance with its terms.

MISSTATEMENT OF AGE OR SEX. If the insured's stated age or sex (except where
unisex rates apply) or both are incorrect in the Contract, Pruco Life will
adjust the death benefits payable, as required by law, to reflect the correct
age and sex. Any death benefit will be based on what the most recent charge for
mortality would have provided at the correct age and sex.

SUICIDE EXCLUSION. Generally, if the insured, whether sane or insane, dies by
suicide within 2 years from the Contract date, Pruco Life will pay no more under
the Contract than the sum of the premiums paid.

ASSIGNMENT. This Contract may not be assigned if such assignment would violate
any federal, state, or local law or regulation. Generally, the Contract may not
be assigned to an employee benefit plan or program without Pruco Life's consent.
Pruco Life assumes no responsibility for the validity or sufficiency of any
assignment, and it will not be obligated to comply with any assignment unless it
has received a copy at one of its Home Offices.

SETTLEMENT OPTIONS. The Contract grants to most owners, or to the beneficiary, a
variety of optional ways of receiving Contract proceeds, other than in a lump
sum. Any Pruco Life representative authorized to sell this Contract can explain
these options upon request.

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INVESTMENT OBJECTIVES AND POLICIES OF THE
PORTFOLIOS

GENERAL

The Prudential Series Fund, Inc. (the "Series Fund") has fifteen separate
portfolios, two of which, the Conservative Balanced Portfolio and the Flexible
Managed Portfolio, are available to PRUVIDER Contract owners. The portfolios are
managed by The Prudential Insurance Company of America ("Prudential"), see
INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES, page 18.

The investment objectives of the Series Fund's portfolios that are available to
PRUVIDER Contract owners can be found under INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS in the prospectus.

CONVERTIBLE SECURITIES

The Conservative Balanced and Flexible Managed Portfolios may invest in
convertible securities. A convertible security is a fixed-income security (a
bond or preferred stock) which may be converted at a stated price within a
specified period of time into a certain quantity of the common stock of the same
or a different issuer. Convertible securities are senior to common stocks in a
corporation's capital structure, but are usually subordinated to similar
nonconvertible securities. While providing a fixed income stream (generally
higher in yield than the income derivable from a common stock but lower than
that afforded by a similar nonconvertible security), a convertible security also
affords an investor the opportunity, through its conversion feature, to
participate in capital appreciation attendant upon a market price advance in the
convertible security's underlying common stock. The price of a convertible
security tends to increase as the market value of the underlying stock rises,
whereas it tends to decrease as the market value of the underlying stock
declines. While no securities investment is without risk, investments in
convertible securities generally entail less risk than investments in the common
stock of the same issuer.

LOAN PARTICIPATIONS

The Conservative Balanced and Flexible Managed Portfolios may invest in fixed
and floating rate loans (Loans) arranged through private negotiations between a
corporate borrower and one or more financial institutions (Lenders). The
portfolios may invest in such Loans generally in the form of participations in
Loans (Participations). Participations typically will result in the Series Fund
having a contractual relationship only with the Lender, not with the borrower.
The Series Fund will have the right to receive payments of principal, interest
and any fees to which it is entitled only from the Lender selling the
Participation and only upon receipt by the Lender of the payments from the
borrower. In connection with purchasing Participations, the Series Fund
generally will have no right to enforce compliance by the borrower with the
terms of the loan agreement relating to the Loan, nor any rights of set-off
against the borrower, and the Series Fund may not benefit directly from any
collateral supporting the Loan in which it has purchased the Participation. As a
result, the Series Fund will assume the credit risk of both the borrower and the
Lender that is selling the Participation. In the event of the insolvency of the
Lender selling a Participation, the Series Fund may be treated as a general
creditor of the Lender and may not benefit from any set-off between the Lender
and the borrower.

WARRANTS

The Conservative Balanced and Flexible Managed Portfolios may invest in warrants
on common stocks. Warrants are options to buy a number of shares of stock at a
predetermined price during a specified period. The risk associated with the
purchase of a warrant is that the purchase price will be lost if the market
price of the stock does not reach a level that justifies the exercise or sale of
the warrant before it expires.

OPTIONS AND FUTURES

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<PAGE>

which the purchaser or holder, in return for a premium paid, has the right to
buy the equity security underlying the option at a specified exercise price at
any time during the term of the option. The writer of the call option, who
receives the premium, has the obligation, upon exercise of the option, to
deliver the underlying equity security against payment of the exercise price. A
put option is a similar contract which gives the purchaser or holder, in return
for a premium, the right to sell the underlying equity security at a specified
price during the term of the option. The writer of the put, who receives the
premium, has the obligation to buy the underlying security at the exercise price
upon exercise by the holder of the put.

The Conservative Balanced and Flexible Managed Portfolios may also purchase
"protective puts" (i.e., put options acquired for the purpose of protecting a
portfolio security from a decline in market value). In exchange for the premium
paid for the put option, the portfolio acquires the right to sell the underlying
security at the exercise price of the put regardless of the extent to which the
underlying security declines in value. The loss to the portfolio is limited to
the premium paid for, and transaction costs in connection with, the put plus the
initial excess, if any, of the market price of the underlying security over the
exercise price. However, if the market price of the security underlying the put
rises, the profit the portfolio realizes on the sale of the security will be
reduced by the premium paid for the put option less any amount (net of
transaction costs) for which the put may be sold. Similar principles apply to
the purchase of puts on debt securities and stock indices, as described below
under OPTIONS ON DEBT SECURITIES, page 8 and OPTIONS ON STOCK INDICES, page 9.

The portfolios may purchase call options for hedging and investment purposes. No
portfolio intends to invest more than 5% of its net assets at any one time in
the purchase of call options on stocks. These portfolios may also purchase
putable and callable equity securities, which are securities coupled with a put
or a call option provided by the issuer.

A portfolio's use of options on equity securities is subject to certain special
risks, in addition to the risk that the market value of the security will move
adversely to the portfolio's option position. An option position may be closed
out only on an exchange, board of trade or other trading facility which provides
a secondary market for an option of the same series. Although a portfolio will
generally purchase or write only those options for which there appears to be an
active secondary market, there is no assurance that a liquid secondary market on
an exchange will exist for any particular option, or at any particular time, and
for some options no secondary market on an exchange or otherwise may exist. In
such event it might not be possible to effect closing transactions in particular
options, with the result that the portfolio would have to exercise its options
in order to realize any profit and would incur brokerage commissions upon the
exercise of such options and upon the subsequent disposition of underlying
securities acquired through the exercise of call options or upon the purchase of
underlying securities for the

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exercise of put options. If a portfolio as a covered call option writer is
unable to effect a closing purchase transaction in a secondary market, it will
not be able to sell the underlying security until the option expires or it
delivers the underlying security upon exercise.

Reasons for the absence of a liquid secondary market on an exchange include the
following: (i) there may be insufficient trading interest in certain options;
(ii) restrictions may be imposed by an exchange on opening transactions or
closing transactions or both; (iii) trading halts, suspensions or other
restrictions may be imposed with respect to particular classes or series of
options or underlying securities; (iv) unusual or unforeseen circumstances may
interrupt normal operations on an exchange; (v) the facilities of an exchange or
a clearing corporation may not at all times be adequate to handle current
trading volume; or (vi) one or more exchanges could, for economic or other
reasons, decide or be compelled at some future date to discontinue the trading
of options (or a particular class or series of options), in which event the
secondary market on that exchange (or in the class or series of options) would
cease to exist, although outstanding options on that exchange that had been
issued by a clearing corporation as a result of trades on that exchange would
continue to be exercisable in accordance with their terms. There is no assurance
that higher than anticipated trading activity or other unforeseen events might
not, at times, render certain of the facilities of any of the clearing
corporations inadequate, which might cause an exchange to institute special
procedures that might interfere with the timely execution of customers' orders.

The purchase and sale of OTC options will also be subject to certain risks.
Unlike exchange-traded options, OTC options generally do not have a continuous
liquid market. Consequently, a portfolio will generally be able to realize the
value of an OTC option it has purchased only by exercising it or reselling it to
the dealer who issued it. Similarly, when a portfolio writes an OTC option, it
generally will be able to close out the OTC option prior to its expiration only
by entering into a closing purchase transaction with the dealer to which the
portfolio originally wrote the OTC option. While the portfolios will seek to
enter into OTC options only with dealers who agree to and which are expected to
be able to be capable of entering into closing transactions with the portfolio,
there can be no assurance that the portfolio will be able to liquidate an OTC
option at a favorable price at any time prior to expiration. In the event of
insolvency of the other party, the portfolio may be unable to liquidate an OTC
option. Prudential monitors the creditworthiness of dealers with whom the Series
Fund enters into OTC option transactions under the general supervision of the
Series Fund's Board of Directors.

OPTIONS ON DEBT SECURITIES. The Conservative Balanced and Flexible Managed
Portfolios may purchase and write (i.e., sell) put and call options on debt
securities (including U.S. Government debt securities) that are traded on U.S.
securities exchanges or that result from privately negotiated transactions with
primary U.S. Government securities dealers recognized by the Federal Reserve
Bank of New York ("over-the-counter" or "OTC" options). Options on debt are
similar to options on stock, except that the option holder has the right to take
or make delivery of a debt security, rather than stock.

The portfolios may also write straddles (i.e., a combination of a call and a put
written on the same security at the same strike price where the same issue of
the security is considered "cover" for both the put and the call). In such
cases, the portfolio will also segregate or deposit for the benefit of the
portfolio's broker cash or liquid high-grade debt obligations equivalent to the
amount, if any, by which the put is "in the money." It is contemplated that each
portfolio's use of straddles will be limited to 5% of the portfolio's net assets
(meaning that the securities used for cover or segregated as described above
will not exceed 5% of the portfolio's net assets at the time the straddle is
written). The writing of a call and a put on the same security at the same
strike price where the call and the put are covered by different securities is
not considered a straddle for purposes of this limit.

The portfolios may purchase "protective puts" in an effort to protect the value
of a security that it owns against a substantial decline in market value.
Protective puts are described above in OPTIONS ON EQUITY SECURITIES, page 6. A
portfolio may wish to protect certain portfolio securities against a decline in
market value at a time when put options on those particular securities are not
available for purchase. A portfolio may therefore purchase a put option on
securities other than those it wishes to protect even though it does not hold
such other securities in its portfolio. While changes in the value of the put
option should generally offset changes in the value of the

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<PAGE>

securities being hedged, the correlation between the two values may not be as
close in these transactions as in transactions in which the portfolio purchases
a put option on an underlying security it owns.

The portfolios may also purchase call options on debt securities for hedging or
investment purposes. No portfolio currently intends to invest more than 5% of
its net assets at any one time in the purchase of call options on debt
securities. A portfolio may also purchase putable and callable debt securities,
which are securities coupled with a put or call option provided by the issuer.

The use of debt options is subject to the same risks described above in
connection with stock options.

OPTIONS ON STOCK INDICES. The Conservative Balanced and Flexible Managed
Portfolios may purchase and sell put and call options on stock indices traded on
securities exchanges or listed on NASDAQ or that result from privately
negotiated transactions with broker-dealers ("OTC options"). Options on stock
indices are similar to options on stock except that rather than the right to
take or make delivery of stock at a specified price, an option on a stock index
gives the holder the right to receive, upon exercise of the option, an amount of
cash if the closing level of the stock index upon which the option is based is
greater than, in the case of a call, or less than, in the case of a put, the
exercise price of the option. This amount of cash is equal to such difference
between the closing price of the index and the exercise price of the option
expressed in dollars times a specified multiple (the "multiplier"). The writer
of the option is obligated, in return for the premium received, to make delivery
of this amount. Unlike stock options, all settlements are in cash, and gain or
loss depends on price movements in the stock market generally (or in a
particular industry or segment of the market) rather than price movements in
individual stocks.

Options on different indices may have different multipliers.

The portfolios may purchase put and call options for hedging and investment
purposes. No portfolio intends to invest more than 5% of its net assets at any
one time in the purchase of puts and calls on stock indices. A portfolio may
effect closing sale and purchase transactions involving options on stock
indices, as described above in connection with stock options.

A portfolio will write only "covered" options on stock indices. A call option is
covered if the portfolio holds a portfolio of stocks at least equal to the value
of the index times the multiplier times the number of contracts. When a
portfolio writes a call option on a broadly based stock market index, the
portfolio will segregate or put into escrow with its custodian or pledge to a
broker as collateral for the option, cash, cash equivalents or "qualified
securities" (defined below) with a market value at the time the option is
written of not less than 100% of the current index value times the multiplier
times the number of contracts. If a portfolio has written an option on an
industry or market segment index, it will segregate or put into escrow with its
custodian or pledge to a broker as collateral for the option at least five
"qualified securities," all of which are stocks of issuers in such industry or
market segment, with a market value at the time the option is written of not
less than 100% of the current index value times the multiplier times the number
of contracts. Such stocks will include stocks which represent at least 50% of
the weighting of the industry or market segment index and will represent at
least 50% of the portfolio's holdings in that industry or market segment. No
individual security will represent more than 15% of the amount so segregated,
pledged or escrowed in the case of broadly based stock market index options or
25% of such amount in the case of industry or market segment index options. If
at the close of business on any day the market value of such qualified
securities so segregated, escrowed or pledged falls below 100% of the current
index value times the multiplier times the number of contracts, the portfolio
will so segregate, escrow or pledge an amount in cash, Treasury bills or other
high-grade short-term obligations equal in value to the difference. In addition,
when a portfolio writes a call on an index which is in-the-money at the time the
call is written, the portfolio will segregate with its custodian or pledge to
the broker as collateral, cash or U.S. Government or other liquid unencumbered
assets equal in value to the amount by which the call is in-the-money times the
multiplier times the number of

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<PAGE>

contracts. Any amount segregated pursuant to the foregoing sentence may be
applied to the portfolio's obligation to segregate additional amounts in the
event that the market value of the qualified securities falls below 100% of the
current index value times the multiplier times the number of contracts. A
"qualified security" is an equity security which is listed on a securities
exchange or NASDAQ against which the portfolio has not written a stock call
option and which has not been hedged by the portfolio by the sale of stock index
futures. However, if the portfolio holds a call on the same index as the call
written where the exercise price of the call held is equal to or less than the
exercise price of the call written or greater than the exercise price of the
call written if the difference is maintained by the portfolio in cash, Treasury
bills or other high-grade short-term obligations in a segregated account with
its custodian, it will not be subject to the requirement described in this
paragraph.

The purchase and sale of options on stock indices will be subject to the risks
described under OPTIONS ON EQUITY SECURITIES, page 6. In addition, the
distinctive characteristics of options on indices create certain risks that are
not present with stock options. Index prices may be distorted if trading of
certain stocks included in the index is interrupted. Trading in the index
options also may be interrupted in certain circumstances, such as if trading
were halted in a substantial number of stocks included in the index. If this
occurred, a portfolio would not be able to close out options which it had
purchased or written and, if restrictions on exercise were imposed, might be
unable to exercise an option it holds, which could result in substantial losses
to the portfolio. It is the policy of the portfolios to purchase or write
options only on stock indices which include a number of stocks sufficient to
minimize the likelihood of a trading halt in options on the index.

There are certain special risks associated with writing calls on stock indices.
Because exercises of index options are settled in cash, a call writer such as a
portfolio cannot determine the amount of its settlement obligations in advance
and, unlike call writing on specific stocks, cannot precisely provide in advance
for, or cover, its potential settlement obligations by acquiring and holding the
underlying securities. The portfolios, however, will follow the "cover"
procedures described above.

When a portfolio has written a call, there is also a risk that the market may
decline between the time the portfolio has a call exercised against it, at a
price which is fixed as of the closing level of the index on the date of the
exercise, and the time the portfolio is able to sell stocks in its portfolio. As
with stock options, a portfolio will not learn that an index option has been
exercised until the day following the exercise date but, unlike a call on stock
where the portfolio would be able to deliver the underlying securities in
settlement, the portfolio may have to sell part of its stock portfolio in order
to make settlement in cash, and the price of such stocks might decline before
they can be sold. This timing risk makes certain strategies involving more than
one option substantially more risky with options in stock indices than with
stock options. For example, even if an index call which a portfolio has written
is "covered" by an index call held by the portfolio with the same strike price,
the portfolio will bear the risk that the level of the index may decline between
the close of trading on the date the exercise notice is filed with the clearing
corporation and the close of trading on the date the portfolio exercises the
call it holds or the time the

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<PAGE>

portfolio sells the call, which in either case would occur no earlier than the
day following the day the exercise notice was filed.

OPTIONS ON FOREIGN CURRENCIES. The Conservative Balanced and Flexible Managed
Portfolios may purchase and write put and call options on foreign currencies
traded on U.S. or foreign securities exchanges or boards of trade for hedging
purposes in a manner similar to that in which forward foreign currency exchange
contracts (see FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS, page 15) and FUTURES
CONTRACTS on foreign currencies (discussed under Futures Contracts, below) will
be employed. Options on foreign currencies are similar to options on stock,
except that the option holder has the right to take or make delivery of a
specified amount of foreign currency, rather than stock.

If, on the other hand, the portfolio manager anticipates purchasing a foreign
security and also anticipates a rise in such foreign currency (thereby
increasing the cost of such security), the portfolio may purchase call options
on the foreign currency. The purchase of such options could offset, at least
partially, the effects of the adverse movements of the exchange rates.
Alternatively, a portfolio could write a put option on the currency and, if the
exchange rates move as anticipated, the option would expire unexercised.

Because there are two currencies involved, developments in either or both
countries can affect the values of options on foreign currencies. In addition,
the quantities of currency underlying option contracts represent odd lots in a
market dominated by transactions between banks; this can mean extra transaction
costs upon exercise. Option markets may be closed while round-the-clock
interbank currency markets are open, and this can create price and rate
discrepancies.

FUTURES CONTRACTS. The Conservative Balanced and Flexible Managed Portfolios
may, to the extent permitted by applicable regulations, attempt to reduce the
risk of investment in equity securities by hedging a portion of their equity
portfolios through the use of stock index futures contracts. A stock index
futures contract is an agreement in which the seller of the contract agrees to
deliver to the buyer an amount of cash equal to a specific dollar amount times
the difference between the value of a specific stock index at the close of the
last trading day of the contract and the price at which the agreement is made.
No physical delivery of the underlying stocks in the index is made.

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The Conservative Balanced and Flexible Managed Portfolios may, to the extent
permitted by applicable regulations, purchase and sell for hedging purpose
futures contracts on interest-bearing securities (such as U.S. Treasury bonds
and notes) or interest rate indices (referred to collectively as "interest rate
futures contracts").

The Conservative Balanced and Flexible Managed Portfolios may, to the extent
permitted by applicable regulations, purchase and sell futures contracts on
foreign currencies or groups of foreign currencies for hedging purposes.

There are several additional risks associated with a portfolio's use of futures
contracts for hedging purposes. One such risk arises because of imperfect
correlation between movements in the price of the futures contract and the price
of the securities or currency that are the subject of the hedge. In the case of
futures contracts on stock or interest rate indices, the correlation between the
price of the futures contract and movements in the index might not be perfect.
To compensate for differences in historical volatility, a portfolio could
purchase or sell future contracts with a greater or lesser value than the
securities or currency it wished to hedge or purchase. In addition, temporary
price distortions in the futures market could be caused by a variety of factors.
Further, the ability of a portfolio to close out a futures position depends on a
liquid secondary market. There is no assurance that a liquid secondary market on
an exchange will exist for any particular futures contract at any particular
time. Further, each portfolio's successful use of futures contracts is to some
extent dependent on the ability of the portfolio manager to predict correctly
movements in the direction of the market, interest rates and/or currency
exchange rates.

In addition, the hours of trading of futures contracts may not conform to the
hours during which the portfolio may trade the underlying securities and/or
currency. To the extent that the futures markets close before the securities or
currency markets, significant price and rate movements can take place in the
securities and/or currency markets that cannot be reflected in the futures
markets.

OPTIONS ON FUTURES CONTRACTS. To the extent permitted by applicable insurance
law and federal regulations, the Conservative Balanced and Flexible Managed
Portfolios may enter into certain transactions involving options on stock index
futures contracts, options on interest rate futures contracts, and options on
foreign currency futures contracts. An option on a futures contract gives the
purchaser or holder the right, but not the obligation, to assume a position in a
futures contract (a long position if the option is a call and a short position
if the option is a put) at a specified price at any time during the option
exercise period. The writer of the option is required upon exercise to assume an
offsetting futures position (a short position if the option is a call and a long
position if the option is a put). Upon exercise of the option, the assumption of
offsetting futures positions by the writer and holder of the option will be
accomplished by delivery of the accumulated balance in the writer's futures
margin account which represents the amount by which the market price of the
futures contract, at exercise, exceeds, in the case of a call, or is less than,
in the case of a put, the exercise price of the option on the futures contract.
As an alternative to exercise, the holder or writer of an option may terminate a
position by selling or purchasing an option of the same series. There is no
guarantee that such closing transactions can be effected. The portfolios intend
to utilize options on futures contracts for the same purposes that they use the
underlying futures contracts.

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<PAGE>

securities being hedged, and the risk that there might not be a liquid secondary
market for the option. There is also the risk of imperfect correlation between
the option and the underlying futures contract. If there were no liquid
secondary market for a particular option on a futures contract, the portfolio
might have to exercise an option it held in order to realize any profit and
might continue to be obligated under an option it had written until the option
expired or was exercised. If the portfolio were unable to close out an option it
had written on a futures contract, it would continue to be required to maintain
initial margin and make variation margin payments with respect to the option
position until the option expired or was exercised against the portfolio.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES

From time to time, in the ordinary course of business, the Conservative Balanced
and Flexible Managed Portfolios may purchase or sell securities on a when-issued
or delayed delivery basis, that is, delivery and payment can take place a month
or more after the date of the transaction. The portfolios will limit such
purchases to those in which the date for delivery and payment falls within 120
days of the date of the commitment. A portfolio will make commitments for such
when-issued transactions only with the intention of actually acquiring the
securities. A portfolio's custodian will maintain, in a separate account, cash,
U.S. Government securities or other liquid unencumbered assets having a value
equal to or greater than such commitments. If a portfolio chooses to dispose of
the right to acquire a when-issued security prior to its acquisition, it could,
as with the disposition of any other portfolio security, incur a gain or loss
due to market fluctuations.

In addition, the short-term portions of the portfolios may purchase money market
securities on a when-issued or delayed delivery basis on the terms set forth
under item 6 in SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY
INVEST, page 22.

SHORT SALES

The Conservative Balanced and Flexible Managed Portfolios may sell securities
they do not own in anticipation of a decline in the market value of those
securities ("short sales"). To complete such a transaction, the portfolio will
borrow the security to make delivery to the buyer. The portfolio is then
obligated to replace the security borrowed by purchasing it at the market price
at the time of replacement. The price at such time may be more or less than the
price at which the security was sold by the portfolio. Until the security is
replaced, the portfolio is required to pay to the lender any interest which
accrues during the period of the loan. To borrow the security the portfolio may
be required to pay a premium which would increase the cost of the security sold.
The proceeds of the short sale will be retained by the broker to the extent
necessary to meet margin requirements until the short position is closed out.
Until the portfolio replaces the borrowed security, it will (a) maintain in a
segregated account cash, U.S. Government securities or other liquid unencumbered
assets at such a level that the amount deposited in the account plus the amount
deposited with the broker as collateral will equal the current market value of
the security sold short and will not be less than the market value of the
security at the time it was sold short or (b) otherwise cover its short
position.

SHORT SALES AGAINST THE BOX

The portfolios may make short sales of securities or maintain a short position,
provided that at all times when a short position is open the portfolio owns an
equal amount of such securities or securities convertible into or exchangeable,
with or without payment of any further consideration, for an equal amount of the
securities of the same issuer as the securities sold short (a "short sale
against the box"); provided, that if further consideration is required in
connection with the conversion or exchange, cash, U.S. Government securities or
other liquid unencumbered assets in an amount equal to such consideration must
be put in a segregated account.

INTEREST RATE SWAPS

The fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may use interest rate swaps to increase or decrease a portfolio's
exposure to long- or short-term interest rates. No portfolio currently intends
to invest more than 5% of its net assets at any one time in interest rate swaps.

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LOANS OF PORTFOLIO SECURITIES

The portfolios may from time to time lend the securities they hold to
broker-dealers, provided that such loans are made pursuant to written agreements
and are continuously secured by collateral in the form of cash, U.S. Government
securities or irrevocable standby letters of credit in an amount equal to at
least the market value at all times of the loaned securities plus the accrued
interest and dividends. During the time securities are on loan, the portfolio
will continue to receive the interest and dividends or amounts equivalent
thereto on the loaned securities while receiving a fee from the borrower or
earning interest on the investment of the cash collateral. The right to
terminate the loan will be given to either party subject to appropriate notice.
Upon termination of the loan, the borrower will return to the lender securities
identical to the loaned securities. The portfolio will not have the right to
vote securities on loan, but would terminate the loan and retain the right to
vote if that were considered important with respect to the investment.

ILLIQUID SECURITIES

The portfolios may hold up to 15% of its net assets in illiquid securities.
Illiquid securities are those which may not be sold in the ordinary course of
business within seven days at approximately the value at which the portfolio has
valued them. Variable and floating rate instruments that cannot be disposed of
within seven days and repurchase agreements with a maturity of greater than
seven days are considered illiquid.

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reliance on the exemption from registration in Section 4(2) of the Securities
Act of 1933 will not be considered illiquid, whether or not it may be resold
under Rule 144A. To make that determination, the following conditions must be
met: (1) the security must not be traded flat or in default as to principal or
interest; (2) the security must be rated in one of the two highest rating
categories by at least two nationally recognized statistical rating
organizations ("NRSROs"), or if only one NRSRO rates the security, by that
NRSRO; if the security is unrated, the adviser must determine that the security
is of equivalent quality; and (3) the adviser must consider the trading market
for the specific security, taking into account all relevant factors. The adviser
will continue to monitor the liquidity of any Rule 144A security or any Section
4(2) commercial paper which has been determined to be liquid and, if a security
is no longer liquid because of changed conditions, the holdings of illiquid
securities will be reviewed to determine if any steps are required to assure
that the 15% test continues to be satisfied.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

To the extent permitted by applicable insurance law, the Conservative Balanced
and Flexible Managed Portfolios may purchase securities denominated in foreign
currencies. To address the currency fluctuation risk that such investments
entail, these portfolios may enter into forward foreign currency exchange
contracts in several circumstances. When a portfolio enters into a contract for
the purchase or sale of a security denominated in a foreign currency, or when a
portfolio anticipates the receipt in a foreign currency of dividends or interest
payments on a security which it holds, the portfolio may desire to "lock-in" the
U.S. dollar price of the security or the U.S. dollar equivalent of such dividend
or interest payment, as the case may be. By entering into a forward contract for
a fixed amount of dollars, for the purchase or sale of the amount of foreign
currency involved in the underlying transactions, the portfolio will be able to
protect itself against a possible loss resulting from an adverse change in the
relationship between the U.S. dollar and the subject foreign currency during the
period between the date on which the security is purchased or sold, or on which
the dividend or interest payment is declared, and the date on which such
payments are made or received.

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<PAGE>

currency-denominated securities. It also should be realized that this method of
protecting the value of the portfolio securities against a decline in the value
of a currency does not eliminate fluctuations in the underlying prices of the
securities which are unrelated to exchange rates. Additionally, although such
contracts tend to minimize the risk of loss due to a decline in the value of the
hedge currency, at the same time they tend to limit any potential gain which
might result should the value of such currency increase.

INVESTMENT RESTRICTIONS

Neither of the portfolios available to PRUVIDER Contract owners will:

3. Acquire securities for the purpose of exercising control or management of
any company except in connection with a merger, consolidation, acquisition
or reorganization.

4. Make short sales of securities or maintain a short position, except that
the Conservative Balanced and Flexible Managed Portfolios may sell
securities short up to 25% of their net assets and may make short sales
against the box. Collateral arrangements entered into with respect to
options, futures contracts and forward contracts are not deemed to be short
sales. Collateral arrangements entered into with respect to interest rate
swap agreements are not deemed to be short sales.

5. Purchase securities on margin or otherwise borrow money or issue senior
securities except that the fixed income portions of the Balanced Portfolios
may enter into reverse repurchase agreements, dollar rolls and may purchase
securities on a when-issued and delayed delivery basis; except that the
money market portion of any portfolio may enter into reverse repurchase
agreements and may purchase securities on a when-issued and delayed
delivery basis; and except that the Flexible Managed and Conservative
Balanced Portfolios may purchase securities on a when-issued or a delayed
delivery basis. The Series Fund may also obtain such short-term credit as
it needs for the clearance of securities transactions and may borrow from a
bank for the account of any portfolio as a temporary measure to facilitate
redemptions (but not for leveraging or investment) or to exercise an
option, an amount that does not exceed 5% of the value of the portfolio's
total assets (including the amount owed as a result of the borrowing) at
the time the borrowing is made. Interest paid on borrowings will not be
available for investment. Collateral arrangements with respect to futures
contracts and options thereon and forward foreign currency exchange
contracts (as permitted by restriction no.1) are not deemed to be the
issuance of a senior security or the purchase of a security on margin.
Collateral arrangements with respect to the writing of options on debt
securities, equity securities, stock indices and foreign currencies by the
Flexible Managed and Conservative Balanced Portfolios are not deemed to be
the issuance of a senior security or the purchase of a security on margin.
Collateral arrangements entered into by the Balanced Portfolios with
respect to interest rate swap agreements are not deemed to be the issuance
of a senior security or the purchase of a security on margin.

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and dollar rolls provided that the portfolio's obligations with respect to
those instruments do not exceed 30% of the portfolio's net assets (defined
to mean total assets at market value less liabilities other than reverse
repurchase agreements and dollar rolls).

17
<PAGE>

4. Any security of a corporation may not be purchased if after the purchase
more than 10% of the market value of the assets of a portfolio would be
invested in the securities of such corporation.

Investment limitations also arise under the insurance laws and regulations of
Arizona and may arise under the laws and regulations of other states. Although
compliance with the requirements of New Jersey law set forth above will
ordinarily result in compliance with any applicable laws of other states, under
some circumstances the laws of other states could impose additional restrictions
on the portfolios. For example, the Series Fund will generally invest no more
than 10% of its assets in the obligations of banks of the foreign countries
described in item 2 of SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY
CURRENTLY INVEST, page 22. In addition, the Series Fund adheres to additional
restrictions relating to such practices as the lending of securities, borrowing,
and the purchase of put and call options, futures contracts, and derivative
instruments on securities to comply with investment guidelines issued by the
California Department of Insurance.

Current federal income tax laws require that the assets of each portfolio be
adequately diversified so that Prudential and other insurers with separate
accounts which invest in the Series Fund and not the Contract owners, are
considered the owners of assets held in the Account for federal income tax
purposes. See TAX TREATMENT OF CONTRACT BENEFITS, page 3. Prudential intends to
maintain the assets of each portfolio pursuant to those diversification
requirements.

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES

The Series Fund and Prudential have entered into an Investment Advisory
Agreement under which Prudential will, subject to the direction of the Board of
Directors of the Series Fund, be responsible for the management of the Series
Fund, and provide investment advice and related services to each portfolio. As
noted in the prospectus, Prudential has also entered into a Service Agreement
with its wholly-owned subsidiary, The Prudential Investment Corporation ("PIC"),
which provides that PIC will furnish to Prudential such services as Prudential
may require in connection with Prudential's performance of its obligations under
the Investment Advisory Agreement.

The investment management fee for the Conservative Balanced Portfolio is equal
to an annual rate of 0.55% of the average daily net assets of each of the
portfolios. For the Flexible Managed Portfolio, the fee is equal to an annual
rate of 0.6% of the average daily net assets of the portfolio.

Each portfolio pays all other expenses incurred in its individual operation and
also pays a portion of the Series Fund's general administrative expenses
allocated on the basis of the asset size of the respective portfolios. Expenses
that will be borne directly by the portfolios include redemption expenses,
expenses of portfolio transactions, shareholder servicing costs, interest,
certain taxes, charges of the Custodian and Transfer Agent, and other expenses
attributable to a particular portfolio. Expenses that will be allocated among
all portfolios include legal expenses, state franchise taxes, auditing services,
costs of printing proxies, costs of stock certificates, Securities and Exchange
Commission fees, accounting costs, the fees and expenses of directors of the
Series Fund who are not affiliated persons of Prudential or any subsidiary of
Prudential, and other expenses properly payable by the entire Series Fund. If
the Series Fund is sued, litigation costs may be directly applicable to one or
more portfolios or allocated on the basis of the size of the respective
portfolios, depending upon the nature of the

18
<PAGE>

lawsuit. The Series Fund's Board of Directors has determined that this is an
appropriate method of allocating expenses.

Under the Investment Advisory Agreement, Prudential has agreed to refund to the
Conservative Balanced and Flexible Managed Portfolios the portion of the
investment management fee for that portfolio equal to the amount that the
aggregate annual ordinary operating expenses of that portfolio (excluding
interest, taxes, and brokerage fees and commissions but including investment
management fees) exceeds 0.75% of the portfolio's average daily net assets.

The Investment Advisory Agreement with Prudential was most recently approved by
the Series Fund's Board of Directors, including a majority of the Directors who
are not interested persons of Prudential, on February 12, 1997 with respect to
the Balanced Portfolios. The Investment Advisory Agreement was most recently
approved by shareholders in accordance with instructions from Contract owners at
their 1989 annual meeting with respect to the Balanced Portfolios. The Agreement
will continue in effect if approved annually by: (1) a majority of the non-
interested persons of the Series Fund's Board of Directors; and (2) by a
majority of the entire Board of Directors or by a majority vote of the
shareholders of each portfolio. The required shareholder approval of the
Agreement shall be effective with respect to any portfolio if a majority of the
voting shares of that portfolio vote to approve the Agreement, even if the
Agreement is not approved by a majority of the voting shares of any other
portfolio or by a majority of the voting shares of the entire Series Fund. The
Agreement provides that it may not be assigned by Prudential and that it may be
terminated upon 60 days' notice by the Series Fund's Board of Directors or by a
majority vote of its shareholders. Prudential may terminate the Agreement upon
90 days' notice.

The Service Agreement between Prudential and PIC was most recently ratified by
shareholders of the Series Fund at their 1989 annual meeting with respect to the
Balanced Portfolios. The Service Agreement between Prudential and PIC will
continue in effect as to the Series Fund for a period of more than 2 years from
its execution, only so long as such continuance is specifically approved at
least annually in the same manner as the Investment Advisory Agreement between
Prudential and the Series Fund. The Service Agreement may be terminated by
either party upon not less than 30 days' prior written notice to the other
party, will terminate automatically in the event of its assignment, and will
terminate automatically as to the Series Fund in the event of the assignment or
termination of the Investment Advisory Agreement between Prudential and the
Series Fund. Prudential is not relieved of its responsibility for all investment
advisory services under the Investment Advisory Agreement. Under the Service
Agreement, Prudential pays PIC a portion of the fee it receives for providing
investment advisory services.

Prudential also serves as the investment advisor to several other investment
companies. When investment opportunities arise that may be appropriate for more
than one entity for which Prudential serves as investment advisor, Prudential
will not favor one over another and may allocate investments among them in an
impartial manner believed to be equitable to each entity involved. The
allocations will be based on each entity's investment objectives and its current
cash and investment positions. Because the various entities for which Prudential
acts as investor advisor have different investment objectives and positions,
Prudential may from time to time buy a particular security for one or more such
entities while at the same time it sells such securities for another.

PORTFOLIO TRANSACTIONS AND BROKERAGE

Prudential is responsible for decisions to buy and sell securities, options on
securities and indices, and futures and related options for the Series Fund.
Prudential is also responsible for the selection of brokers, dealers, and
futures commission merchants to effect the transactions and the negotiation of
brokerage commissions, if any. Broker- dealers may receive brokerage commissions
on Series Fund portfolio transactions, including options and the purchase and
sale of underlying securities upon the exercise of options. Orders may be
directed to any broker or futures commission merchant including, to the extent
and in the manner permitted by applicable law, Prudential Securities
Incorporated, an indirect wholly-owned subsidiary of Prudential.

Bonds, including convertible bonds, and equity securities traded in the
over-the-counter market are generally traded on a "net" basis with dealers
acting as principal for their own accounts without a stated commission, although
the price of the security usually includes a profit to the dealer. In
underwritten offerings, securities are purchased at a fixed price which includes
an amount of compensation to the underwriter, generally referred to as the
underwriter's concession or discount. On occasion, certain money market
instruments and U.S. Government agency securities may be purchased directly from
the issuer, in which case no commissions or discounts are paid. The Series Fund
will not deal with Prudential Securities Incorporated in any transaction in
which Prudential Securities Incorporated acts as principal. Thus, it will not
deal with Prudential Securities Incorporated if execution involves Prudential
Securities Incorporated's acting as principal with respect to any part of the
Series Fund's order.

19
<PAGE>

Fund, will not significantly affect the portfolios' current ability to pursue
their respective investment objectives. However, in the future it is possible
that the Series Fund may under other circumstances be at a disadvantage because
of this limitation in comparison to other funds not subject to such a
limitation.

Subject to the above considerations, Prudential Securities Incorporated may act
as a securities broker or futures commission merchant for the Series Fund. In
order for Prudential Securities Incorporated to effect any portfolio
transactions for the Series Fund, the commissions received by Prudential
Securities Incorporated must be reasonable and fair compared to the commissions
received by other brokers in connection with comparable transac tions involving
similar securities being purchased or sold on a securities exchange during a
comparable period of time. This standard would allow Prudential Securities
Incorporated to receive no more than the remuneration that would be expected to
be received by an unaffiliated broker or futures commission merchant in a
commensurate arm's-length transaction. Furthermore, the Board of Directors of
the Series Fund, including a majority of the non- interested directors, has
adopted procedures which are reasonably designed to provide that any
commissions, fees or other remuneration paid to Prudential Securities
Incorporated are consistent with the foregoing standard. In accordance with Rule
11a2-2(T) under the Securities Exchange Act of 1934, Prudential Securities
Incorporated may not retain compensation for effecting transactions on a
securities exchange for the Series Fund unless the Series Fund has expressly
authorized the retention of such compensation in a written contract executed by
the Series Fund and Prudential Securities Incorporated. Rule 11a2-2(T) provides
that Prudential Securities Incorporated must furnish to the Series Fund at least
annually a statement setting forth the total amount of all compensation retained
by Prudential Securities Incorporated from transactions effected for the Series
Fund during the applicable period. Brokerage and futures transactions with
Prudential Securities Incorporated are also subject to such fiduciary standards
as may be imposed by applicable law.

For the years 1996, 1995, and 1994, the Series Fund paid a total of $xxx,
$11,607,197, and $11,579,886, respectively, in brokerage commissions for all
portfolios. Of those amounts, $xxx, $899,739, and $560,155, for 1996, 1995, and
1994, respectively, was paid out to Prudential Securities Incorporated. For
1996, the commissions paid to this affiliated broker constituted xxx% of the
total commissions paid by the Series Fund for that year. Transactions through
this affiliated broker accounted for xxx% of the aggregate dollar amount of
transactions for all of the portfolios of the Series Fund involving the payment
of commissions.

DETERMINATION OF NET ASSET VALUE

Shares in the Series Fund are currently offered continuously, without sales
charge, at prices equal to the respective net asset values of the portfolios,
only to separate accounts to fund benefits payable under the Contracts described
in the variable life insurance and variable annuity prospectuses. The Series
Fund may at some later date also offer its shares to other separate accounts of
Prudential or other insurers. Prudential acts as principal underwriter to the
Series Fund. As such, Prudential receives no underwriting compensation from the
Series Fund.

20
<PAGE>

Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and
Christmas Day. In the event the New York Stock Exchange closes early on any
business day, the net asset value of each portfolio shall be determined at a
time between such closing and 4:15 p.m. New York City time.

In determining the net asset value of any intermediate or long-term fixed income
securities of the Balanced Portfolios (other than debt obligations with
remaining maturities of less than 60 days, which are valued at amortized cost)
will be valued utilizing an independent pricing service to determine valuations
for normal institutional size trading units of securities. The pricing service
considers such factors as security prices, yields, maturities, call features,
ratings, and developments relating to specific securities in arriving at
securities valuations.

All short-term debt obligations in the money market portions of the Balanced
Portfolios of 12 months maturity or less are valued on an amortized cost basis
in accordance with an order obtained from the Securities and Exchange
Commission. This means that each obligation will be valued initially at its
purchase price and thereafter by amortizing any discount or premium uniformly to
maturity, regardless of the impact of fluctuating interest rates on the market
value of the obligation. This highly practical method of valuation is in
widespread use and almost always results in a value that is extremely close to
the actual market value. In order to continue to utilize the amortized cost
method of valuation, the Money Market Portfolio may not purchase any security
with a remaining maturity of more than 12 months and must maintain a
dollar-weighted average portfolio maturity of 120 days or less. In the event of
sizeable changes in interest rates, however, the value determined by this method
may be higher or lower than the price that would be received if the obligation
were sold. The Series Fund's Board of Directors has established procedures to
monitor whether any material deviation occurs and, if so, will promptly consider
what action, if any, should be initiated to prevent unfair results to Contract
owners. The short-term portion of these portfolios may be invested only in high
quality instruments, as described in SECURITIES IN WHICH THE MONEY MARKET
PORTFOLIO MAY CURRENTLY INVEST, page 22.

The net asset value of the common stocks and convertible debt securities of the
portfolios will be determined in the following manner. Any security for which
the primary market is on an exchange is generally valued at the last sale price
on such exchange as of the close of the NYSE (which is currently 4:00 p.m. New
York City time) or, in the absence of recorded sales, at the mean between the
most recently quoted bid and asked prices. NASDAQ National Market System equity
securities are valued at the last sale price or, if there was no sale on such
day, at the mean between the most recently quoted bid and asked prices. Other
over-the-counter equity securities are valued at the mean between the most
recently quoted bid and asked prices. Convertible debt securities that are
actively traded in the over-the-counter market, including listed securities for
which the primary market is believed to be over-the-counter, are valued at the
mean between the most recently quoted bid and asked prices. Corporate bonds
(other than convertible debt securities) are valued on the same basis as
intermediate or long-term fixed income securities, as described above.
Short-term debt instruments which mature in less than 60 days are valued at
amortized cost. For valuation purposes, quotations of foreign securities in a
foreign currency are converted to U.S. dollar equivalents.

Generally, trading in foreign securities, as well as corporate bonds, U.S.
Government securities, and money market instruments, is substantially completed
each day at various times prior to the close of the NYSE. The values of any such
securities are determined as of such times for purposes of computing a
portfolio's net asset value. Foreign currency exchange rates are also generally
determined prior to the close of the NYSE. If an extraordinary event occurs
after the close of an exchange on which that security is traded, the security
will be valued at fair value as determined in good faith by the applicable
portfolio manager under procedures established by and under the general
supervision of the Series Fund's Board of Directors.

Securities or assets for which market quotations are not readily available will
be valued at fair value as determined by Prudential under the direction of the
Board of Directors of the Series Fund.

21
<PAGE>

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST*

3. Commercial paper, variable amount demand master notes, bills, notes and other
obligations issued by a U.S. company, a foreign company or a foreign government,
its agencies, instrumentalities or political subdivisions, denominated in U.S.
dollars, and, at the date of investment, rated at least A or A-2 by Standard &
Poor's Rating Group ("S&P"), A or Prime-2 by Moody's Investors Service
("Moody's") or, if not rated, issued by an entity having an outstanding
unsecured debt issue rated at least A or A-2 by S&P or A or Prime-2 by Moody's.
For a description of corporate bond ratings, see DEBT RATINGS, page 24. If such
obligations are guaranteed or supported by a letter of credit issued by a bank,
such bank (including a foreign bank) must meet the requirements set forth in
paragraph 2 above. If such obligations are guaranteed or insured by an insurance
company or other non-bank entity, such insurance company or other non-bank
entity must represent a credit of high quality, as determined by the Series
Fund's investment adviser (which as noted above is currently Prudential) under
the supervision of the Series Fund's Board of Directors.

* Although the Money Market Portfolio is not available to PRUVIDER Contract
owners, any short-term portion of the Balanced Portfolios may be invested in the
types of securities described in this section.

22
<PAGE>

financial recordkeeping standards and requirements as domestics issuers.
Securities issued by foreign issuers may be subject to greater fluctuations in
price than securities issued by U.S. entities. Finally, in the event of default
with respect to any such foreign debt obligations, it may be more difficult for
the Series Fund to obtain or to enforce a judgment against the issuers of such
securities.

4. Repurchase Agreements. When the Money Market Portfolio purchases money market
securities of the types described above, it may on occasion enter into a
repurchase agreement with the seller wherein the seller and the buyer agree at
the time of sale to repurchase of the security at a mutually agreed upon time
and price. The period of maturity is usually quite short, possibly overnight or
a few days, although it may extend over a number of months. The resale price is
in excess of the purchase price, reflecting an agreed-upon market rate effective
for the period of time the portfolio's money is invested in the security, and is
not related to the coupon rate of the purchased security. Repurchase agreements
may be considered loans of money to the seller of the underlying security, which
are collateralized by the securities underlying the repurchase agreement. The
Series Fund will not enter into repurchase agreements unless the agreement is
"fully collateralized" (i.e., the value of the securities is, and during the
entire term of the agreement remains, at least equal to the amount of the 'loan'
including accrued interest). The Series Fund will take possession of the
securities underlying the agreement and will value them daily to assure that
this condition is met. The Series Fund has adopted standards for the parties
with whom it will enter into repurchase agreements which it believes are
reasonably designed to assure that such a party presents no serious risk of
becoming involved in bankruptcy proceedings within the time frame contemplated
by the repurchase agreement. In the event that a seller defaults on a repurchase
agreement, the Series Fund may incur a loss in the market value of the
collateral, as well as disposition costs; and, if a party with whom the Series
Fund had entered into a repurchase agreement becomes involved in bankruptcy
proceedings, the Series Fund's ability to realize on the collateral may be
limited or delayed and a loss may be incurred if the collateral securing the
repurchase agreement declines in value during the bankruptcy proceedings.

5. Reverse Repurchase Agreements. The Money Market Portfolio may use reverse
repurchase agreements, which are described under REVERSE REPURCHASE AGREEMENTS
AND DOLLAR ROLLS in the prospectus. No portfolio may obligate more than 10% of
its net assets in connection with reverse repurchase agreements, except that the
fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may obligate up to 30% of their net assets in connection with reverse
repurchase agreements and dollar rolls.

6. When-Issued and Delayed Delivery Securities. From time to time, in the
ordinary course of business, the Money Market Portfolio may purchase securities
on a when-issued or delayed delivery basis (i.e., delivery and payment can take
place a month or more after the date of the transaction). The purchase price and
the interest rate payable on the securities are fixed on the transaction date.
The securities so purchased are subject to market fluctuation, and no interest
accrues to the portfolio until delivery and payment take place. At the time the
portfolio makes the commitment to purchase securities on a when-issued or
delayed delivery basis, it will record the transaction and thereafter reflect
the value, each day, of such securities in determining its net asset value. The
portfolio will make commitments for when-issued transactions only with the
intention of actually acquiring the securities and, to facilitate such
acquisitions, the Series Fund's custodian bank will maintain in a separate
account securities of the portfolio having a value equal to or greater than such
commitments. On delivery dates for such transactions, the portfolio will meet
its obligations from maturities or sales of the securities held in the separate
account and/or from then available cash flow. If the portfolio chooses to
dispose of the right to acquire a when-issued security prior to its acquisition,
it could, as with the disposition of any other obligation, incur a gain or loss
due to market fluctuation. No when-issued commitments will be made if, as a
result, more than 15% of the portfolio's net assets would be so committed.

23
<PAGE>

term rating category, or unrated securities of comparable quality as determined
by the Series Fund's Board. Second tier securities are eligible securities that
are not first tier securities; (3) The portfolio will not invest more than 5% of
its total assets in second tier securities; (4) The portfolio may not invest
more than 1% of its assets in second tier securities of any one issuer; (5) In
the event a first tier security held by the portfolio is downgraded and becomes
a second tier security, or in the case of an unrated security the Series Fund's
Board determines it is no longer of comparable quality to a first tier security,
or in the event Prudential becomes aware that an NRSRO has rated a second tier
security or an unrated portfolio security below its second highest rating, the
Board will reassess promptly whether the security presents minimal credit risks
and shall cause the portfolio to take such action as the Board determines is in
the best interests of the portfolio and its shareholders; (6) In the event of a
default or if because of a rating downgrade a security held in the portfolio is
no longer an eligible investment, the portfolio will sell the security as soon
as practicable unless the Series Fund's Board makes a specific finding that such
action would not be in the best interest of the portfolio; and (7) The
portfolio's dollar-weighted average maturity will be no more than 90 days. The
Series Fund's Board of Directors has adopted written procedures delegating to
the investment advisor under certain guidelines the responsibility to make
several of the above-described determinations, including certain credit quality
determinations.

DEBT RATINGS

Moody's Investors Services, Inc. describes its categories of corporate debt
securities and its "Prime-1" and "Prime-2" commercial paper as follows:

Bonds:

Aaa - Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.

Aa - Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally
known as high grade bonds. They are rated lower than the best bonds because
margins of protection may not as large as in Aaa securities or fluctuation
of protective elements may be of greater amplitude or there may be other
elements present which make the long term risks appear somewhat larger than
in Aaa securities.

A - Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may
be present which suggest a susceptibility to impairment sometime in the
future.

Baa - Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

Ba - Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.

B - Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance
of other terms of the contract over any long period of time may be small.

Caa - Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.

Ca - Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.

Commercial paper:

-- Leading market positions in well-established industries.

-- High rates of return of funds employed.

24
<PAGE>

-- Conservative capitalization structures with moderate reliance on debt
and ample asset protection.

-- Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

-- Well established access to a range of financial markets and assured
sources of alternate liquidity.

Standard & Poor's Rating Group describes its grades of corporate debt securities
and its "A" commercial paper as follows:

Bonds:

AAA Bonds rated AAA are highest grade obligations. They possess the
ultimate degree of protection as to principal and interest.
Marketwise they move with interest rates, and hence provide the
maximum safety on all counts.

AA Bonds rated AA also qualify as high grade obligations, and in the
majority of instances differ from AAA issues only in small
degree. Here, too, prices move with the long term money market.

A Bonds rated A are regarded as upper medium grade. They have
considerable investment strength but are not entirely free from
adverse effects of changes in economic and trade conditions.
Interest and principal are regarded as safe. They are
predominately reflect money rates in their market behavior, but
to some extent, also economic conditions.

BBB Bonds rated BBB, or medium grade, are borderline between
definitely sound obligations and those where the speculative
element begins to predominate. These bonds have adequate asset
coverage and normally are protected by satisfactory earnings.
Their susceptibility to changing conditions, particularly to
depressions, necessitates constant watching. Marketwise, the
bonds are more responsive to business and trade conditions than
to interest rates. This group is the lowest which qualifies for
commercial bank investment.

Commercial paper:

Commercial paper rated A by Standard & Poor's Corporation has the following
characteristics: Liquidity ratios are better than the industry average. Long
term senior debt rating is "A" or better. In some cases BBB credits may be
acceptable. The issuer has access to at least two additional channels of
borrowings. Basic earnings and cash flow have an upward trend with allowances
made for unusual circumstances. Typically, the issuer's industry is well
established, the issuer has a strong position within its industry and the
reliability and quality of management is unquestioned. Issuers rated A are
further referred to by use of numbers 1, 2 and 3 to denote relative strength
within this classification.

POSSIBLE REPLACEMENT OF THE SERIES FUND

Although Prudential believes it to be unlikely, it is possible that in the
judgment of its management, one or more of the portfolios of the Series Fund may
become unsuitable for investment by Contract owners because of investment policy
changes, tax law changes, or the unavailability of shares for investment. In
that event, Prudential may seek to substitute the shares of another portfolio or
of an entirely different mutual fund. Before this can be done, the approval of
the SEC, and possibly one or more state insurance departments, will be required.
Contract owners will be notified of such substitution.

In addition, although it is highly unlikely, it is conceivable that in the
future it may become disadvantageous for both variable life insurance and
variable annuity contract separate accounts to invest in the same underlying
mutual fund. Although neither the companies which invest in the Series Fund nor
the Series Fund currently foresees any such disadvantage, the Series Fund's
Board of Directors intends to monitor events in order to identify any material
conflict between variable life insurance and variable annuity contract owners
and to determine what action, if any, should be taken in response thereto.
Material conflicts could result from such things as: (1) changes in state
insurance law; (2) changes in federal income tax law; (3) changes in the
investment management of any portfolio

25
<PAGE>

of the Series Fund; or (4) difference between voting instructions given by
variable life insurance and variable annuity contract owners. Prudential will
bear the expense, if it does become necessary, of remedying any material
conflict including establishing a new underlying investment company and
segregating the assets held under variable life insurance and variable annuity
contracts.

OTHER INFORMATION CONCERNING THE SERIES FUND

INCORPORATION AND AUTHORIZED STOCK

The Series Fund was incorporated under Maryland law on November 15, 1982. The
authorized Capital Stock of the Series Fund consists of 2 billion shares, par
value $0.01 per share. The shares of Capital Stock are divided into fifteen
classes: MONEY MARKET PORTFOLIO Capital Stock (225 million shares), DIVERSIFIED
BOND PORTFOLIO Capital Stock (200 million shares), HIGH YIELD BOND PORTFOLIO
Capital Stock (100 million shares), GOVERNMENT INCOME PORTFOLIO Capital Stock
(100 million shares), EQUITY PORTFOLIO Capital Stock (200 million shares), STOCK
INDEX PORTFOLIO Capital Stock (100 million shares), EQUITY INCOME PORTFOLIO
Capital Stock (100 million shares), NATURAL RESOURCES PORTFOLIO Capital Stock
(100 million shares), GLOBAL PORTFOLIO Capital Stock (100 million shares),
CONSERVATIVE BALANCED PORTFOLIO Capital Stock (300 million shares), FLEXIBLE
MANAGED PORTFOLIO Capital Stock (300 million shares), ZERO COUPON BOND PORTFOLIO
2000 Capital Stock (25 million shares), ZERO COUPON BOND PORTFOLIO 2005 Capital
Stock (50 million shares), PRUDENTIAL JENNISON PORTFOLIO Capital Stock (50
million shares), SMALL CAPITALIZATION STOCK PORTFOLIO Capital Stock (50 million
shares). The shares of each portfolio, when issued, will be fully paid and
non-assessable, will have no conversion, exchange or similar rights, and will be
freely transferable. Each share of stock will have a pro rata interest in the
assets of the portfolio to which the stock of that class relates and will have
no interest in the assets of any other portfolio.

DIVIDENDS, DISTRIBUTIONS AND TAXES

The Series Fund is qualified as a regulated investment company under Section 851
of the Internal Revenue Code and distributes substantially all of each
portfolio's net investment income and realized gains from securities
transactions to the respective subaccounts, which immediately reinvest it. For
each taxable year in which it and each of its portfolios so qualify, the Series
Fund will not be subject to tax on net investment income and realized gains from
securities transactions distributed to shareholders.

CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT

EXPERTS

The financial statements of the Series Fund included in this statement of
additional information and the FINANCIAL HIGHLIGHTS and PORTFOLIO RATES OF
RETURN included in the prospectus for the year ended December 31, 1996 have been
audited by Price Waterhouse LLP, independent accountants, as stated in their
report appearing herein and are included in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing. Price
Waterhouse LLP's principal business address is 1177 Avenue of the Americas, New
York, New York 10036.

The financial statements of the Series Fund included in this statement of
additional information and the FINANCIAL HIGHLIGHTS and PORTFOLIO RATES OF
RETURN included in the prospectus for the years prior to 1996 have been audited
by Deloitte & Touche LLP, independent auditors, as stated in their report
appearing herein and are included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing. Deloitte & Touche
LLP's principal business address is Two Hilton Court, Parsippany, NJ 07054-0319.

26
<PAGE>

LICENSE

27
<PAGE>

DIRECTORS AND OFFICERS OF PRUCO LIFE AND
MANAGEMENT OF THE SERIES FUND

DIRECTORS AND OFFICERS

The directors and major officers of Pruco Life, listed with their principal
occupations during the past 5 years, are shown below.

DIRECTORS OF PRUCO LIFE

WILLIAM M. BETHKE, Director. -- President, Prudential Capital Markets Group
since 1992.

MENDEL A. MELZER, Director. -- Chief Investment Officer, Mutual Funds and
Annuities, Prudential Investments since 1996; 1995 to 1996: Chief Financial
Officer of the Money Management Group of Prudential; 1993 to 1995: Senior Vice
President and Chief Financial Officer of Prudential Preferred Financial
Services; Prior to 1993: Managing Director, Prudential Investment Corporation.

ESTHER H. MILNES, President and Director. -- Vice President and Actuary,
Prudential Individual Insurance Group since 1996; 1993 to 1996: Senior Vice
President and Chief Actuary, Prudential Insurance and Financial Services;
Prior to 1993: Vice President and Associate Actuary of Prudential.

I. EDWARD PRICE, Vice Chairman and Director. -- Senior Vice President and
Actuary, Prudential Individual Insurance Group since 1995; 1994 to 1995: Chief
Executive Officer, Prudential International Insurance; 1993 to 1994: President,
Prudential International Insurance; Prior to 1993: Senior Vice President and
Company Actuary of Prudential.

KIYOFUMI SAKAGUCHI, Director. -- President, Prudential International Insurance
Group since 1995; 1994 to 1995: Chairman and Chief Executive Officer, The
Prudential Life Insurance Co., Ltd.; Prior to 1994: President and Chief
Executive Officer, Asia Pacific Region-Prudential International Insurance, and
President, The Prudential Life Insurance Co., Ltd.

WILLIAM F. YELVERTON, Chairman and Director. --Chief Executive Officer,
Prudential Individual Insurance Group since 1995; Prior to 1995: Chief Executive
Officer, New York Life Worldwide.

OFFICERS WHO ARE NOT DIRECTORS

SUSAN L. BLOUNT, Secretary.--Vice President and Secretary of Prudential since
1995; Prior to 1995: Assistant General Counsel for Prudential Residential
Services Company.

C. EDWARD CHAPLIN, Treasurer. -- Vice President and Treasurer of Prudential
since 1995; 1993 to 1995: Managing Director and Assistant Treasurer of
Prudential; 1992 to 1993: Vice President and Assistant Treasurer, Banking and
Cash Management for Prudential.

LINDA S. DOUGHERTY, Vice President, Comptroller and Chief Accounting Officer. --
Vice President and Comptroller, Prudential Individual Insurance Group since
1997; Prior to 1997: Vice President, Accounting, Prudential.

JAMES C. DROZANOWSKI, Senior Vice President. -- Vice President and Operations
Executive, Prudential Individual Insurance Group since 1996; 1995 to 1996:
President and Chief Executive Officer of Chase Manhattan Bank; 1993 to 1995:
Vice President, North America Customer Services, Chase Manhattan Bank; Prior to
1993: Operations Executive, Global Securities Services, Chase Manhattan Bank.

CLIFFORD E. KIRSCH, Chief Legal Officer. -- Chief Counsel, Variable Products,
Law Department of Prudential since 1995; 1994 to 1995: Associate General Counsel
with Paine Webber; Prior to 1994: Assistant Director in the Division of
Investment Management with the Securities and Exchange Commission.

FRANK P. MARINO, Senior Vice President. -- Vice President, Policyowner Relations
Department, Prudential Individual Insurance Group since 1996; Prior to 1996:
Senior Vice President, Prudential Mutual Fund Services.

MARIO A. MOSSE, Senior Vice President. -- Vice President, Annuity Services,
Prudential Investments since 1996; Prior to 1996: Vice President, Chase
Manhattan Bank.

SHIRLEY H. SHAO, Senior Vice President and Chief Actuary. -- Vice President and
Associate Actuary, Prudential.

KAREN L. SHAPIRO, Senior Vice President. -- Vice President, Prudential
Individual Insurance Group since 1996; Vice President and Associate General
Counsel, Prudential Securities Incorporated 1993 to 1996; Prior to 1993:
Senior Associate with Shaw, Pittman, Potts and Trowbridge.

The business address of all directors and officers of Pruco Life is 213
Washington Street, Newark, New Jersey 07102-2992.

* SUBSIDIARY OF PRUDENTIAL

28
<PAGE>

MANAGEMENT OF THE SERIES FUND

DIRECTORS OF THE SERIES FUND

SAUL K. FENSTER, Director--President of New Jersey Institute of Technology.
Address: 323 Martin Luther King Boulevard, Newark, New Jersey 07102.

JOSEPH WEBER, Director--Vice President, Interclass (international corporate
learning). Address: 37 Beachmont Terrace, North Caldwell, New Jersey 07006.

OFFICERS WHO ARE NOT DIRECTORS

EUGENE STARK, Comptroller, Principal Financial Officer and Treasurer--Vice
President, Prudential Investments.

29
<PAGE>

FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.

"A" pages to be inserted here

TO BE FILED PURSUANT TO RULE 485(B)

30
<PAGE>

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS

"B" pages to be inserted here

TO BE FILED PURSUANT TO RULE 485(B)

31
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1997

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

PRUVIDER
VARIABLE
APPRECIABLE
LIFE(R)___________________
INSURANCE CONTRACTS

PROVIDING FOR THE INVESTMENT
OF ASSETS IN THE
INVESTMENT PORTFOLIOS OF

THE PRUDENTIAL SERIES
FUND, INC.

The Pruco Life Insurance Company of New Jersey, a stock life insurance company
that is an indirect wholly-owned subsidiary of the Prudential Insurance Company
of America, offers a variable life insurance contract called the PRUVIDER
Variable APPRECIABLE LIFE(R) Insurance Contract*. The Contract provides
whole-life insurance protection. The death benefit varies daily with investment
experience but will never be less than the "face amount" of insurance specified
in the Contract. The Contract also generally provides a cash surrender value
which also varies with investment experience. There is no guaranteed minimum
cash surrender value.

The assets held for the purpose of paying benefits under these contracts can be
invested in one or both of the two available subaccounts of the Pruco Life of
New Jersey Variable Appreciable Account. The assets invested in each subaccount
are in turn invested in a corresponding portfolio of The Prudential Series Fund,
Inc., a diversified, open-end management investment company (commonly known as a
mutual fund) that is intended to provide a range of investment alternatives to
variable contract owners. Each portfolio is, for investment purposes, in effect
a separate fund. The two available Series Fund portfolios are the CONSERVATIVE
BALANCED PORTFOLIO and the FLEXIBLE MANAGED PORTFOLIO. A separate class of
capital stock is issued for each portfolio. Shares of the Series Fund are
currently sold only to separate accounts of Pruco Life of New Jersey and certain
other insurers to fund the benefits under variable life insurance and variable
annuity contracts issued by those companies.

The PRUVIDER Variable APPRECIABLE LIFE(R) Insurance Contract owner may also
choose to invest in a fixed-rate option which is described in the prospectus of
The Pruco Life of New Jersey Variable Appreciable Account.

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THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
IN CONJUNCTION WITH THE PROSPECTUS OF THE PRUCO LIFE OF NEW JERSEY VARIABLE
APPRECIABLE ACCOUNT DATED MAY 1, 1997, WHICH IS AVAILABLE WITHOUT CHARGE UPON
WRITTEN REQUEST TO THE PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY, 213
WASHINGTON STREET, NEWARK, NEW JERSEY 07102-2992 OR BY TELEPHONING (800)
437-4016, Ext. 46.

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PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
213 Washington Street
Newark, New Jersey 07102-2992
Telephone: (800) 437-4016, Ext. 46

*PRUVIDER is a service mark of Prudential.
APPRECIABLE LIFE is a registered mark of Prudential.
SVAL-2SAI Ed 5-97
Catalog No. 64M087E

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION

CONTENTS

Page

TREATMENT AS LIFE INSURANCE................................. 3
PRE-DEATH DISTRIBUTIONS..................................... 3
WITHHOLDING................................................. 4
OTHER TAX CONSIDERATIONS.................................... 4

SALE OF THE CONTRACT AND SALES COMMISSIONS........................... 5
RIDERS ............................................................ 5
OTHER STANDARD CONTRACT PROVISIONS................................... 5

BENEFICIARY................................................. 5
INCONTESTABILITY............................................ 5
MISSTATEMENT OF AGE OR SEX.................................. 5
SUICIDE EXCLUSION........................................... 5
ASSIGNMENT.................................................. 5
SETTLEMENT OPTIONS.......................................... 6

INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS.......................... 6
GENERAL ............................................................ 6
CONVERTIBLE SECURITIES............................................... 6
LOAN PARTICIPATIONS.................................................. 6
WARRANTS ............................................................ 6
OPTIONS AND FUTURES.................................................. 7
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES..........................13
SHORT SALES..........................................................13
SHORT SALES AGAINST THE BOX..........................................13
INTEREST RATE SWAPS..................................................14
LOANS OF PORTFOLIO SECURITIES........................................14
ILLIQUID SECURITIES..................................................14
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS..........................15

INVESTMENT RESTRICTIONS.......................................................16

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES...............................18

PORTFOLIO TRANSACTIONS AND BROKERAGE..........................................19

DETERMINATION OF NET ASSET VALUE..............................................21

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY CURRENTLY INVEST...........22

DEBT RATINGS..................................................................24

POSSIBLE REPLACEMENT OF THE SERIES FUND.......................................25

OTHER INFORMATION CONCERNING THE SERIES FUND..................................26
INCORPORATION AND AUTHORIZED STOCK...................................26
DIVIDENDS, DISTRIBUTIONS AND TAXES...................................26
CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT.............26
EXPERTS ............................................................26
LICENSE ............................................................27

DIRECTORS AND OFFICERS OF PRUCO LIFE OF NEW JERSEY AND MANAGEMENT OF THE
SERIES FUND...................................................................28

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FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC. .....................A1

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS.....................B1
<PAGE>

MORE DETAILED INFORMATION ABOUT THE CONTRACT

SALES LOAD UPON SURRENDER

The limitation is based on a Guideline Annual Premium ("GAP") that is associated
with every Contract. The GAP is an amount determined actuarially in accordance
with a definition set forth in a regulation of the Securities and Exchange
Commission ("SEC"). The maximum aggregate sales load that Pruco Life of New
Jersey will charge (that is, the sum of the monthly sales load deduction and the
contingent deferred sales charge) will not be more than 30% of the premiums
actually paid until those premiums total one GAP plus no more than 9% of the
next premiums paid until total premiums are equal to 5 GAPS, plus no more than
6% of all subsequent premiums. If the sales charges described above would at any
time exceed this maximum amount then the charge, to the extent of any excess,
will not be made.

REDUCTION OF CHARGES FOR CONCURRENT SALES TO SEVERAL INDIVIDUALS

Pruco Life of New Jersey may reduce the sales charges and/or other charges on
individual Contracts sold to members of a class of associated individuals, or to
a trustee, employer or other entity representing such a class, where it is
expected that such multiple sales will result in savings of sales or
administrative expenses. Pruco Life of New Jersey determines both the
eligibility for such reduced charges, as well as the amount of such reductions,
by considering the following factors: (1) the number of individuals; (2) the
total amount of premium payments expected to be received from these Contracts;
(3) the nature of the association between these individuals, and the expected
persistency of the individual Contracts; (4) the purpose for which the
individual Contracts are purchased and whether that purpose makes it likely that
expenses will be reduced; and (5) any other circumstances which Pruco Life of
New Jersey believes to be relevant in determining whether reduced sales or
administrative expenses may be expected. Some of the reductions in charges for
these sales may be contractually guaranteed; other reductions may be withdrawn
or modified by Pruco Life of New Jersey on a uniform basis. Pruco Life of New
Jersey's reductions in charges for these sales will not be unfairly
discriminatory to the interests of any individual Contract owners.

PAYING PREMIUMS BY PAYROLL DEDUCTION

In addition to the annual, semi-annual, quarterly and monthly premium payment
modes, a payroll budget method of paying premiums may also be available under
certain Contracts. The employer generally deducts the necessary amounts from
employee paychecks and sends premium payments to Pruco Life of New Jersey
monthly. Any Pruco Life of New Jersey representative authorized to sell this
Contract can provide further details concerning the payroll budget method of
paying premiums.

UNISEX PREMIUMS AND BENEFITS

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charges will be based on a blended unisex rate whether the insured is male or
female. In addition, employers and employee organizations considering purchase
of a Contract should consult their legal advisors to determine whether purchase
of a Contract based on sex-distinct actuarial tables is consistent with Title
VII of the Civil Rights Act of 1964 or other applicable law. Pruco Life of New
Jersey may offer the Contract with unisex mortality rates to such prospective
purchasers.

HOW THE DEATH BENEFIT WILL VARY

WITHDRAWAL OF EXCESS CASH SURRENDER VALUE

Under certain circumstances, a Contract owner may withdraw a portion of the
Contract's cash surrender value without surrendering the Contract in whole or in
part. The amount that a Contract owner may withdraw is limited by the
requirement that the Contract Fund after withdrawal must not be less than the
Tabular Contract Fund value. (A Table of Tabular Contract Fund Values is
included in the Contract; the values increase with each year the Contract
remains in force.) But because the Contract Fund may be made up in part by an
outstanding Contract loan, there is a further limitation that the amount
withdrawn may not be larger than an amount sufficient to reduce the cash
surrender value to zero. The amount withdrawn must be at least $200. An owner
may make no more than four such withdrawals in each Contract year, and there is
a $15 administrative processing fee for each withdrawal. An amount withdrawn may
not be repaid except as a scheduled or unscheduled premium subject to the
applicable charges. Upon request, Pruco Life of New Jersey will tell a Contract
owner how much he or she may withdraw. Withdrawal of part of the cash surrender
value may have tax consequences. See TAX TREATMENT OF CONTRACT BENEFITS, below.
A temporary need for funds may also be met by making a loan and you should
consult your Pruco Life of New Jersey representative about how best to meet your
needs.

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TAX TREATMENT OF CONTRACT BENEFITS

Each prospective purchaser is urged to consult a qualified tax advisor. The
following discussion is not intended as tax advice, and it is not a complete
statement of what the effect of federal income taxes will be under all
circumstances. Rather, it provides information about how Pruco Life of New
Jersey believes the tax laws apply in the most commonly occurring circumstances.
There is no guarantee, however, that the current federal income tax laws and
regulations or interpretations will not change.

TREATMENT AS LIFE INSURANCE. The Contract will be treated as "life insurance" as
long as it satisfies certain definitional tests set forth in Section 7702 of the
Internal Revenue Code (the "Code") and as long as the underlying investments for
the Contract satisfy diversification requirements set forth in Treasury
Regulations issued pursuant to Section 817(h) of the Code.

Pruco Life of New Jersey believes that it has taken adequate steps to cause the
Contract to be treated as life insurance for tax purposes. This means that: (1)
except as noted below, the Contract owner should not be taxed on any part of the
Contract Fund, including additions attributable to interest or appreciation
until amounts are distributed under the Contract; and (2) the death benefit
should be excludible from the gross income of the beneficiary under section
101(a) of the Code.

Pruco Life of New Jersey intends to comply with final regulations issued under
sections 7702 and 817. Therefore, it reserves the right to make such changes as
it deems necessary to assure that the Contract continues to qualify as life
insurance for tax purposes. Any such changes will apply uniformly to affected
Contract owners and will be made only after advance written notice to affected
Contract owners.

Extra premiums for optional benefits and riders generally do not count in
computing gross premiums paid, which in turn determines the extent to which
a withdrawal might be taxed.

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Loans received under the Contract will ordinarily be treated as
indebtedness of the owner and will not be considered to be distributions
subject to tax.

Under certain circumstances, Modified Endowment Contracts issued during any
calendar year will be treated as a single contract for purposes of applying
the above rules.

Business-owned life insurance is subject to additional rules. Section 264(a)(1)
of the Code generally precludes business contract owners from deducting premium
payments. The recently enacted Health Insurance Portability and Accountability
Act of 1996 generally disallows tax deductions for interest on contract debt on
a business- owned insurance policy effective (with certain transitional rules)
for interest paid or accrued after October 13, 1995. An exception permits the
deduction of interest on policy loans on contracts for up to 20 key persons. The
interest deduction for contract debt on such loans is limited to a prescribed
interest rate and a maximum aggregate loan amount of $50,000 per key insured
person. The Code also imposes an indirect tax upon additions to the Contract
fund or the receipt of death benefits under business-owned life insurance
policies under certain circumstances by way of the corporate alternative minimum
tax.

The individual situation of each Contract owner or beneficiary will determine
the federal estate taxes and the state and local estate, inheritance and other
taxes due if the owner or insured dies.

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SALE OF THE CONTRACT AND SALES COMMISSIONS

Sales expenses in any year are not equal to the deduction for sales load in that
year. Pruco Life of New Jersey expects to recover its total sales expenses over
the periods the Contracts are in effect. To the extent that the sales charges
are insufficient to cover total sales expenses, the sales expenses will be
recovered from Pruco Life of New Jersey's surplus, which may include amounts
derived from the mortality and expense risk charge and the guaranteed minimum
death benefit risk charge described in the prospectus under DAILY DEDUCTION FROM
THE CONTRACT FUND and item (d) under MONTHLY DEDUCTIONS FROM CONTRACT FUND.

RIDERS

Any Pruco Life of New Jersey representative authorized to sell the Contract can
explain these extra benefits further. Samples of the provisions are available
from Pruco Life of New Jersey upon written request.

OTHER STANDARD CONTRACT PROVISIONS

INCONTESTABILITY. After the Contract has been in force during the insured's
lifetime for 2 years from the Contract date or, with respect to any change in
the Contract that requires Pruco Life of New Jersey's approval and could
increase its liability, after the change has been in effect during the insured's
lifetime for 2 years from the effective date of the change, Pruco Life of New
Jersey will not contest its liability under the Contract in accordance with its
terms.

MISSTATEMENT OF AGE OR SEX. If the insured's stated age or sex (except where
unisex rates apply) or both are incorrect in the Contract, Pruco Life of New
Jersey will adjust the death benefits payable, as required by law, to reflect
the correct age and sex. Any death benefit will be based on what the most recent
charge for mortality would have provided at the correct age and sex.

SUICIDE EXCLUSION. Generally, if the insured, whether sane or insane, dies by
suicide within 2 years from the Contract date, Pruco Life of New Jersey will pay
no more under the Contract than the sum of the premiums paid.

ASSIGNMENT. This Contract may not be assigned if such assignment would violate
any federal, state, or local law or regulation. Generally, the Contract may not
be assigned to an employee benefit plan or program without Pruco Life of New
Jersey's consent. Pruco Life of New Jersey assumes no responsibility for the
validity or sufficiency of any assignment, and it will not be obligated to
comply with any assignment unless it has received a copy at one of its Home
Offices.

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SETTLEMENT OPTIONS. The Contract grants to most owners, or to the beneficiary, a
variety of optional ways of receiving Contract proceeds, other than in a lump
sum. Any Pruco Life of New Jersey representative authorized to sell this
Contract can explain these options upon request.

INVESTMENT OBJECTIVES AND POLICIES OF
THE PORTFOLIOS

GENERAL

The investment objectives of the Series Fund's portfolios that are available to
PRUVIDER Contract owners can be found under INVESTMENT OBJECTIVES AND POLICIES
OF THE PORTFOLIOS in the prospectus.

CONVERTIBLE SECURITIES

LOAN PARTICIPATIONS

WARRANTS

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OPTIONS AND FUTURES

OPTIONS ON EQUITY SECURITIES. The Conservative Balanced and Flexible Managed
Portfolios may purchase and write (i.e., sell) put and call options on equity
securities that are traded on securities exchanges or that are listed on the
National Association of Securities Dealers Automated Quotation System ("NASDAQ")
or that result from privately negotiated transactions with broker-dealers ("OTC
options"). A call option is a short-term contract pursuant to which the
purchaser or holder, in return for a premium paid, has the right to buy the
equity security underlying the option at a specified exercise price at any time
during the term of the option. The writer of the call option, who receives the
premium, has the obligation, upon exercise of the option, to deliver the
underlying equity security against payment of the exercise price. A put option
is a similar contract which gives the purchaser or holder, in return for a
premium, the right to sell the underlying equity security at a specified price
during the term of the option. The writer of the put, who receives the premium,
has the obligation to buy the underlying security at the exercise price upon
exercise by the holder of the put.

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<PAGE>

will exist for any particular option, or at any particular time, and for some
options no secondary market on an exchange or otherwise may exist. In such event
it might not be possible to effect closing transactions in particular options,
with the result that the portfolio would have to exercise its options in order
to realize any profit and would incur brokerage commissions upon the exercise of
such options and upon the subsequent disposition of underlying securities
acquired through the exercise of call options or upon the purchase of underlying
securities for the exercise of put options. If a portfolio as a covered call
option writer is unable to effect a closing purchase transaction in a secondary
market, it will not be able to sell the underlying security until the option
expires or it delivers the underlying security upon exercise.

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The portfolios may purchase "protective puts" in an effort to protect the value
of a security that it owns against a substantial decline in market value.
Protective puts are described above in OPTIONS ON EQUITY SECURITIES, page 7. A
portfolio may wish to protect certain portfolio securities against a decline in
market value at a time when put options on those particular securities are not
available for purchase. A portfolio may therefore purchase a put option on
securities other than those it wishes to protect even though it does not hold
such other securities in its portfolio. While changes in the value of the put
option should generally offset changes in the value of the securities being
hedged, the correlation between the two values may not be as close in these
transactions as in transactions in which the portfolio purchases a put option on
an underlying security it owns.

The use of debt options is subject to the same risks described above in
connection with stock options.

Options on different indices may have different multipliers.

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value of such qualified securities so segregated, escrowed or pledged falls
below 100% of the current index value times the multiplier times the number of
contracts, the portfolio will so segregate, escrow or pledge an amount in cash,
Treasury bills or other high-grade short-term obligations equal in value to the
difference. In addition, when a portfolio writes a call on an index which is
in-the-money at the time the call is written, the portfolio will segregate with
its custodian or pledge to the broker as collateral, cash, U.S. Government or
other liquid unencumbered assets equal in value to the amount by which the call
is in-the-money times the multiplier times the number of contracts. Any amount
segregated pursuant to the foregoing sentence may be applied to the portfolio's
obligation to segregate additional amounts in the event that the market value of
the qualified securities falls below 100% of the current index value times the
multiplier times the number of contracts. A "qualified security" is an equity
security which is listed on a securities exchange or NASDAQ against which the
portfolio has not written a stock call option and which has not been hedged by
the portfolio by the sale of stock index futures. However, if the portfolio
holds a call on the same index as the call written where the exercise price of
the call held is equal to or less than the exercise price of the call written or
greater than the exercise price of the call written if the difference is
maintained by the portfolio in cash, Treasury bills or other high-grade
short-term obligations in a segregated account with its custodian, it will not
be subject to the requirement described in this paragraph.

The purchase and sale of options on stock indices will be subject to the risks
described above under OPTIONS ON EQUITY SECURITIES, page 7. In addition, the
distinctive characteristics of options on indices create certain risks that are
not present with stock options. Index prices may be distorted if trading of
certain stocks included in the index is interrupted. Trading in the index
options also may be interrupted in certain circumstances, such as if trading
were halted in a substantial number of stocks included in the index. If this
occurred, a portfolio would not be able to close out options which it had
purchased or written and, if restrictions on exercise were imposed, might be
unable to exercise an option it holds, which could result in substantial losses
to the portfolio. It is the policy of the portfolios to purchase or write
options only on stock indices which include a number of stocks sufficient to
minimize the likelihood of a trading halt in options on the index.

There are certain special risks associated with writing calls on stock indices.
Because exercises of index options are settled in cash, a call writer such as a
portfolio cannot determine the amount of its settlement obligations in advance
and, unlike call writing on specific stocks, cannot precisely provide in advance
for, or cover, its potential settlement obligations by acquiring and holding the
underlying securities. The portfolios, however, will follow the "cover"
procedures described above.

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they can be sold. This timing risk makes certain strategies involving more than
one option substantially more risky with options in stock indices than with
stock options. For example, even if an index call which a portfolio has written
is "covered" by an index call held by the portfolio with the same strike price,
the portfolio will bear the risk that the level of the index may decline between
the close of trading on the date the exercise notice is filed with the clearing
corporation and the close of trading on the date the portfolio exercises the
call it holds or the time the portfolio sells the call, which in either case
would occur no earlier than the day following the day the exercise notice was
filed.

OPTIONS ON FOREIGN CURRENCIES. The Conservative Balanced and Flexible Managed
Portfolios may purchase and write put and call options on foreign currencies
traded on U.S. or foreign securities exchanges or boards of trade for hedging
purposes in a manner similar to that in which forward foreign currency exchange
contracts (see FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS, page 15) and futures
contracts on foreign currencies (discussed under FUTURES CONTRACTS, page 11)
will be employed. Options on foreign currencies are similar to options on stock,
except that the option holder has the right to take or make delivery of a
specified amount of foreign currency, rather than stock.

If, on the other hand, the portfolio manager anticipates purchasing a foreign
security and also anticipates a rise in such foreign currency (thereby
increasing the cost of such security), the portfolio may purchase call options
on the foreign currency. The purchase of such options could offset, at least
partially, the effects of the adverse movements of the exchange rates.
Alternatively, a portfolio could write a put option on the currency and, if the
exchange rates move as anticipated, the option would expire unexercised.

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equity portfolios through the use of stock index futures contracts. A stock
index futures contract is an agreement in which the seller of the contract
agrees to deliver to the buyer an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index is
made.

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same series. There is no guarantee that such closing transactions can be
effected. The portfolios intend to utilize options on futures contracts for the
same purposes that they use the underlying futures contracts.

Options on futures contracts are subject to risks similar to those described
above with respect to option on securities, options on stock indices, and
futures contracts. These risks include the risk that the portfolio manager may
not correctly predict changes in the market, the risk of imperfect correlation
between the option and the securities being hedged, and the risk that there
might not be a liquid secondary market for the option. There is also the risk of
imperfect correlation between the option and the underlying futures contract. If
there were no liquid secondary market for a particular option on a futures
contract, the portfolio might have to exercise an option it held in order to
realize any profit and might continue to be obligated under an option it had
written until the option expired or was exercised. If the portfolio were unable
to close out an option it had written on a futures contract, it would continue
to be required to maintain initial margin and make variation margin payments
with respect to the option position until the option expired or was exercised
against the portfolio.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES

SHORT SALES

The Conservative Balanced and Flexible Managed Portfolios may sell securities
they do not own in anticipation of a decline in the market value of those
securities ("short sales"). To complete such a transaction, the portfolio will
borrow the security to make delivery to the buyer. The portfolio is then
obligated to replace the security borrowed by purchasing it at the market price
at the time of replacement. The price at such time may be more or less than the
price at which the security was sold by the portfolio. Until the security is
replaced, the portfolio is required to pay to the lender any interest which
accrues during the period of the loan. To borrow the security the portfolio may
be required to pay a premium which would increase the cost of the security sold.
The proceeds of the short sale will be retained by the broker to the extent
necessary to meet margin requirements until the short position is closed out.
Until the portfolio replaces the borrowed security, it will (a) maintain in a
segregated account cash, U.S. Government or other liquid unencumbered assets
securities at such a level that the amount deposited in the account plus the
amount deposited with the broker as collateral will equal the current market
value of the security sold short and will not be less than the market value of
the security at the time it was sold short or (b) otherwise cover its short
position.

SHORT SALES AGAINST THE BOX

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INTEREST RATE SWAPS

LOANS OF PORTFOLIO SECURITIES

ILLIQUID SECURITIES

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dealer undertakings to make a market in the security; and (4) the nature of the
security and the nature of the marketplace trades. A portfolio's treatment of
Rule 144A securities as liquid could have the effect of increasing the level of
portfolio illiquidity to the extent that qualified institutional buyers become,
for a time, uninterested in purchasing these securities. In addition, the
adviser, acting under guidelines approved and monitored by the Board of
Directors, may conditionally determine, for purposed of the 15% test, that
certain commercial paper issued in reliance on the exemption from registration
in Section 4(2) of the Securities Act of 1933 will not be considered illiquid,
whether or not it may be resold under Rule 144A. To make that determination, the
following conditions must be met: (1) the security must not be traded flat or in
default as to principal or interest; (2) the security must be rated in one of
the two highest rating categories by at least two nationally recognized
statistical rating organizations ("NRSROs"), or if only one NRSRO rates the
security, by that NRSRO; if the security is unrated, the adviser must determine
that the security is of equivalent quality; and (3) the adviser must consider
the trading market for the specific security, taking into account all relevant
factors. The adviser will continue to monitor the liquidity of any Rule 144A
security or any Section 4(2) commercial paper which has been determined to be
liquid and, if a security is no longer liquid because of changed conditions, the
holdings of illiquid securities will be reviewed to determine if any steps are
required to assure that the 15% test continues to be satisfied.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

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portfolio will realize a gain to the extent that the price of the currency it
has agreed to sell exceeds the price of the currency it has agreed to purchase.
Should forward prices increase, the portfolio will suffer a loss to the extent
that the price of the currency it has agreed to purchase exceeds the price of
the currency it has agreed to sell.

The portfolios' dealing in forward foreign currency exchange contracts will be
limited to the transactions described above. Of course, the portfolios are not
required to enter into such transactions with regard to their foreign
currency-denominated securities. It also should be realized that this method of
protecting the value of the portfolio securities against a decline in the value
of a currency does not eliminate fluctuations in the underlying prices of the
securities which are unrelated to exchange rates. Additionally, although such
contracts tend to minimize the risk of loss due to a decline in the value of the
hedge currency, at the same time they tend to limit any potential gain which
might result should the value of such currency increase.

INVESTMENT RESTRICTIONS

Neither of the portfolios available to PRUVIDER Contract owners will:

3. Acquire securities for the purpose of exercising control or management of
any company except in connection with a merger, consolidation, acquisition
or reorganization.

5. Purchase securities on margin or otherwise borrow money or issue senior
securities except that the fixed income portions of the Balanced Portfolios
may enter into reverse repurchase agreements, dollar rolls and may purchase
securities on a when-issued and delayed delivery basis; except that the
money market portion of any portfolio may enter into reverse repurchase
agreements and may purchase securities on a when-issued and delayed
delivery basis; and except that the Flexible Managed and Conservative
Balanced Portfolios may purchase securities on a when-issued or a delayed
delivery basis. The Series Fund may also obtain such short-term credit as
it needs for the clearance of securities transactions and may borrow from a
bank for the account of any portfolio as a temporary measure to facilitate
redemptions (but not for leveraging or investment) or to exercise an
option, an amount that does not exceed 5% of the value of the portfolio's
total assets (including the amount owed as a result of the borrowing) at
the time the borrowing is made. Interest paid on borrowings will not be
available for investment. Collateral arrangements with respect to futures
contracts and options thereon and forward foreign currency exchange
contracts (as permitted by restriction no.1) are not deemed to be the
issuance of a senior security or the purchase of a security on margin.
Collateral arrangements with respect to the writing of options on debt
securities, equity securities, stock indices and foreign currencies by the
Conservative Balanced and Flexible Managed Portfolios are not deemed to be
the issuance of a senior security or the purchase of a security on margin.
Collateral arrangements

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entered into by the Balanced Portfolios with respect to interest rate swap
agreements are not deemed to be the issuance of a senior security or the
purchase of a security on margin.

6. Enter into reverse repurchase agreements if, as a result, the portfolio's
obligations with respect to reverse repurchase agreements would exceed 10%
of the portfolio's net assets (defined to mean total assets at market value
less liabilities other than reverse repurchase agreements); except that the
fixed income portions of the Conservative Balanced and Flexible Managed
Portfolios may enter into reverse repurchase agreements and dollar rolls
provided that the portfolio's obligations with respect to those instruments
do not exceed 30% of the portfolio's net assets (defined to mean total
assets at market value less liabilities other than reverse repurchase
agreements and dollar rolls).

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includes any corporation, joint stock association, business trust, business
joint venture, business partnership, savings and loan association, credit
union or other mutual savings institution.

4. Any security of a corporation may not be purchased if after the purchase
more than 10% of the market value of the assets of a portfolio would be
invested in the securities of such corporation.

Investment limitations also arise under the insurance laws and regulations of
Arizona and may arise under the laws and regulations of other states. Although
compliance with the requirements of New Jersey law set forth above will
ordinarily result in compliance with any applicable laws of other states, under
some circumstances the laws of other states could impose additional restrictions
on the portfolios. For example, the Series Fund will generally invest no more
than 10% of its assets in the obligations of banks of the foreign countries
described in item 2 of SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO MAY
CURRENTLY INVEST, page 22. In addition, the Series Fund adheres to additional
restrictions relating to such practices as the lending of securities, borrowing,
and the purchase of put and call options, futures contracts, and derivative
instruments on securities to comply with investment guidelines issued by the
California Department of Insurance.

Current federal income tax laws require that the assets of each portfolio be
adequately diversified so that Prudential and other insurers with separate
accounts which invest in the Series Fund and not the Contract owners, are
considered the owners of assets held in the Account for federal income tax
purposes. See TAX TREATMENT OF CONTRACT BENEFITS, page 3. Prudential intends to
maintain the assets of each portfolio pursuant to those diversification
requirements.

INVESTMENT MANAGEMENT ARRANGEMENTS AND EXPENSES

18
<PAGE>

Each portfolio pays all other expenses incurred in its individual operation and
also pays a portion of the Series Fund's general administrative expenses
allocated on the basis of the asset size of the respective portfolios. Expenses
that will be borne directly by the portfolios include redemption expenses,
expenses of portfolio transactions, shareholder servicing costs, interest,
certain taxes, charges of the Custodian and Transfer Agent, and other expenses
attributable to a particular portfolio. Expenses that will be allocated among
all portfolios include legal expenses, state franchise taxes, auditing services,
costs of printing proxies, costs of stock certificates, Securities and Exchange
Commission fees, accounting costs, the fees and expenses of directors of the
Series Fund who are not affiliated persons of Prudential or any subsidiary of
Prudential, and other expenses properly payable by the entire Series Fund. If
the Series Fund is sued, litigation costs may be directly applicable to one or
more portfolios or allocated on the basis of the size of the respective
portfolios, depending upon the nature of the lawsuit. The Series Fund's Board of
Directors has determined that this is an appropriate method of allocating
expenses.

The Investment Advisory Agreement with Prudential was most recently approved by
the Series Fund's Board of Directors, including a majority of the Directors who
are not interested persons of Prudential, on February 12, 1997 with respect to
the Balanced Portfolios. The Investment Advisory Agreement was most recently
approved by shareholders in accordance with instructions from Contract owners at
their 1989 annual meeting with respect to the Balanced Portfolios. The Agreement
will continue in effect if approved annually by: (1) a majority of the non-
interested persons of the Series Fund's Board of Directors; and (2) by a
majority of the entire Board of Directors or by a majority vote of the
shareholders of each portfolio. The required shareholder approval of the
Agreement shall be effective with respect to any portfolio if a majority of the
voting shares of that portfolio vote to approve the Agreement, even if the
Agreement is not approved by a majority of the voting shares of any other
portfolio or by a majority of the voting shares of the entire Series Fund. The
Agreement provides that it may not be assigned by Prudential and that it may be
terminated upon 60 days' notice by the Series Fund's Board of Directors or by a
majority vote of its shareholders. Prudential may terminate the Agreement upon
90 days' notice.

Prudential also serves as the investment advisor to several other investment
companies. When investment opportunities arise that may be appropriate for more
than one entity for which Prudential serves as investment advisor, Prudential
will not favor one over another and may allocate investments among them in an
impartial manner believed to be equitable to each entity involved. The
allocations will be based on each entity's investment objectives and its current
cash and investment positions. Because the various entities for which Prudential
acts as investor advisor have different investment objectives and positions,
Prudential may from time to time buy a particular security for one or more such
entities while at the same time it sells such securities for another.

PORTFOLIO TRANSACTIONS AND BROKERAGE

Prudential is responsible for decisions to buy and sell securities, options on
securities and indices, and futures and related options for the Series Fund.
Prudential is also responsible for the selection of brokers, dealers, and
futures commission merchants to effect the transactions and the negotiation of
brokerage commissions, if any. Broker- dealers may receive brokerage commissions
on Series Fund portfolio transactions, including options and the purchase and
sale of underlying securities upon the exercise of options. Orders may be
directed to any broker or futures commission merchant including, to the extent
and in the manner permitted by applicable law, Prudential Securities
Incorporated, an indirect wholly-owned subsidiary of Prudential.

19
<PAGE>

price of the security usually includes a profit to the dealer. In underwritten
offerings, securities are purchased at a fixed price which includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. On occasion, certain money market instruments and U.S.
Government agency securities may be purchased directly from the issuer, in which
case no commissions or discounts are paid. The Series Fund will not deal with
Prudential Securities Incorporated in any transaction in which Prudential
Securities Incorporated acts as principal. Thus, it will not deal with
Prudential Securities Incorporated if execution involves Prudential Securities
Incorporated's acting as principal with respect to any part of the Series Fund's
order. Portfolio securities may not be purchased from any underwriting or
selling syndicate of which Prudential Securities Incorporated, during the
existence of the syndicate, is a principal underwriter (as defined in the 1940
Act) except in accordance with rules of the Securities and Exchange Commission.
This limitation, in the opinion of the Series Fund, will not significantly
affect the portfolios' current ability to pursue their respective investment
objectives. However, in the future it is possible that the Series Fund may under
other circumstances be at a disadvantage because of this limitation in
comparison to other funds not subject to such a limitation.

Subject to the above considerations, Prudential Securities Incorporated may act
as a securities broker or futures commission merchant for the Series Fund. In
order for Prudential Securities Incorporated to effect any portfolio
transactions for the Series Fund, the commissions received by Prudential
Securities Incorporated must be reasonable and fair compared to the commissions
received by other brokers in connection with comparable transac tions involving
similar securities being purchased or sold on a securities exchange during a
comparable period of time. This standard would allow Prudential Securities
Incorporated to receive no more than the remuneration that would be expected to
be received by an unaffiliated broker or futures commission merchant in a
commensurate arm's-length transaction. Furthermore, the Board of Directors of
the Series Fund, including a majority of the non- interested directors, has
adopted procedures which are reasonably designed to provide that any
commissions, fees or other remuneration paid to Prudential Securities
Incorporated are consistent with the foregoing standard. In accordance with Rule
11a2-2(T) under the Securities Exchange Act of 1934, Prudential Securities
Incorporated may not retain compensation for effecting transactions on a
securities exchange for the Series Fund unless the Series Fund has expressly
authorized the retention of such compensation in a written contract executed by
the Series Fund and Prudential Securities Incorporated. Rule 11a2-2(T) provides
that Prudential Securities Incorporated must furnish to the Series Fund at least
annually a statement setting forth the total amount of all compensation retained
by Prudential Securities Incorporated from transactions effected for the Series
Fund during the applicable period. Brokerage and futures transactions with
Prudential Securities Incorporated are also subject to such fiduciary standards
as may be imposed by applicable law.

20
<PAGE>

DETERMINATION OF NET ASSET VALUE

As noted in the prospectus, the net asset value of the shares of each portfolio
is determined once daily on each day the New York Stock Exchange ("NYSE") is
open for business. The NYSE is open for business Monday through Friday except
for the days on which the following holidays are observed: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day, and Christmas Day. In the event the New York Stock Exchange
closes early on any business day, the net asset value of each portfolio shall be
determined at a time between such closing and 4:15 p.m. New York City time.

Generally, trading in foreign securities, as well as corporate bonds, U.S.
Government securities, and money market instruments, is substantially completed
each day at various times prior to the close of the NYSE. The values of any such
securities are determined as of such times for purposes of computing a
portfolio's net asset value. Foreign currency exchange rates are also generally
determined prior to the close of the NYSE. If an extraordinary event occurs
after the close of an exchange on which that security is traded, the security
will be valued at fair value as determined in good faith by the applicable
portfolio manager under procedures established by and under the general
supervision of the Series Fund's Board of Directors.

21
<PAGE>

on such day, at the mean between the most recently quoted bid and asked prices
on such exchange or board of trade.

Securities or assets for which market quotations are not readily available will
be valued at fair value as determined by Prudential under the direction of the
Board of Directors of the Series Fund.

SECURITIES IN WHICH THE MONEY MARKET PORTFOLIO
MAY CURRENTLY INVEST*

3. Commercial paper, variable amount demand master notes, bills, notes and other
obligations issued by a U.S. company, a foreign company or a foreign government,
its agencies, instrumentalities or political subdivisions, denominated in U.S.
dollars, and, at the date of investment, rated at least A or A-2 by Standard &
Poor's Rating Group ("S&P"), A or Prime-2 by Moody's Investors Service
("Moody's") or, if not rated, issued by an entity having an outstanding
unsecured debt issue rated at least A or A-2 by S&P or A or Prime-2 by Moody's.
For a description of corporate bond ratings, see DEBT RATINGS page 24. If such
obligations are guaranteed or supported by a letter of credit issued by a bank,
such bank (including a foreign bank) must meet the requirements set forth in
paragraph 2 above. If such obligations are guaranteed or insured by an insurance
company or other non-bank entity, such insurance company or other non-bank
entity must represent a credit of high quality, as determined by the Series
Fund's investment adviser (which as noted above is currently Prudential) under
the supervision of the Series Fund's Board of Directors.

22
<PAGE>

withholding taxes on interest income payable on such obligations held by the
Series Fund, the possible seizure or nationalization of foreign deposits, and
the possible establishment of exchange controls or other foreign governmental
laws or restrictions which might affect adversely the payment of principal and
interest on such obligations held by the Series Fund. In addition, there may be
less publicly available information about a foreign issuer than about a domestic
one, and foreign issuers may not be subject to the same accounting, auditing and
financial recordkeeping standards and requirements as domestics issuers.
Securities issued by foreign issuers may be subject to greater fluctuations in
price than securities issued by U.S. entities. Finally, in the event of default
with respect to any such foreign debt obligations, it may be more difficult for
the Series Fund to obtain or to enforce a judgment against the issuers of such
securities.

4. Repurchase Agreements. When the Money Market Portfolio purchases money market
securities of the types described above, it may on occasion enter into a
repurchase agreement with the seller wherein the seller and the buyer agree at
the time of sale to repurchase of the security at a mutually agreed upon time
and price. The period of maturity is usually quite short, possibly overnight or
a few days, although it may extend over a number of months. The resale price is
in excess of the purchase price, reflecting an agreed-upon market rate effective
for the period of time the portfolio's money is invested in the security, and is
not related to the coupon rate of the purchased security. Repurchase agreements
may be considered loans of money to the seller of the underlying security, which
are collateralized by the securities underlying the repurchase agreement. The
Series Fund will not enter into repurchase agreements unless the agreement is
"fully collateralized" (i.e., the value of the securities is, and during the
entire term of the agreement remains, at least equal to the amount of the 'loan'
including accrued interest). The Series Fund will take possession of the
securities underlying the agreement and will value them daily to assure that
this condition is met. The Series Fund has adopted standards for the parties
with whom it will enter into repurchase agreements which it believes are
reasonably designed to assure that such a party presents no serious risk of
becoming involved in bankruptcy proceedings within the time frame contemplated
by the repurchase agreement. In the event that a seller defaults on a repurchase
agreement, the Series Fund may incur a loss in the market value of the
collateral, as well as disposition costs; and, if a party with whom the Series
Fund had entered into a repurchase agreement becomes involved in bankruptcy
proceedings, the Series Fund's ability to realize on the collateral may be
limited or delayed and a loss may be incurred if the collateral securing the
repurchase agreement declines in value during the bankruptcy proceedings.

6. When-Issued and Delayed Delivery Securities. From time to time, in the
ordinary course of business, the Money Market Portfolio may purchase securities
on a when-issued or delayed delivery basis (i.e., delivery and payment can take
place a month or more after the date of the transaction). The purchase price and
the interest rate payable on the securities are fixed on the transaction date.
The securities so purchased are subject to market fluctuation, and no interest
accrues to the portfolio until delivery and payment take place. At the time the
portfolio makes the commitment to purchase securities on a when-issued or
delayed delivery basis, it will record the transaction and thereafter reflect
the value, each day, of such securities in determining its net asset value. The
portfolio will make commitments for when-issued transactions only with the
intention of actually acquiring the securities and, to facilitate such
acquisitions, the Series Fund's custodian bank will maintain in a separate
account securities of the portfolio having a value equal to or greater than such
commitments. On delivery dates for such transactions, the portfolio will meet
its obligations from maturities or sales of the securities held in the separate
account and/or from then available cash flow. If the portfolio chooses to
dispose of the right to acquire a when-issued security prior to its acquisition,
it could, as with the disposition of any other obligation, incur a gain or loss
due to market fluctuation. No when-issued commitments will be made if, as a
result, more than 15% of the portfolio's net assets would be so committed.

23
<PAGE>

("NRSROs") assigning a rating to the security or issue, or if only one NRSRO has
assigned a rating, that NRSRO. An unrated security must be deemed to be of
comparable quality as determined by the Series Fund's Board. In other words, the
portfolio will invest in only first tier or second tier securities. First tier
securities are securities which are rated by at least two NRSROs, or by the only
NRSRO that has rated the security, in the highest short-term rating category, or
unrated securities of comparable quality as determined by the Series Fund's
Board. Second tier securities are eligible securities that are not first tier
securities; (3) The portfolio will not invest more than 5% of its total assets
in second tier securities; (4) The portfolio may not invest more than 1% of its
assets in second tier securities of any one issuer; (5) In the event a first
tier security held by the portfolio is downgraded and becomes a second tier
security, or in the case of an unrated security the Series Fund's Board
determines it is no longer of comparable quality to a first tier security, or in
the event Prudential becomes aware that an NRSRO has rated a second tier
security or an unrated portfolio security below its second highest rating, the
Board will reassess promptly whether the security presents minimal credit risks
and shall cause the portfolio to take such action as the Board determines is in
the best interests of the portfolio and its shareholders; (6) In the event of a
default or if because of a rating downgrade a security held in the portfolio is
no longer an eligible investment, the portfolio will sell the security as soon
as practicable unless the Series Fund's Board makes a specific finding that such
action would not be in the best interest of the portfolio; and (7) The
portfolio's dollar-weighted average maturity will be no more than 90 days. The
Series Fund's Board of Directors has adopted written procedures delegating to
the investment advisor under certain guidelines the responsibility to make
several of the above-described determinations, including certain credit quality
determinations.

DEBT RATINGS

Moody's Investors Services, Inc. describes its categories of corporate debt
securities and its "Prime-1" and "Prime-2" commercial paper as follows:

Bonds:

Caa - Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.

Ca - Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.

Commercial paper:

24
<PAGE>

-- Leading market positions in well-established industries.

-- High rates of return of funds employed.

-- Conservative capitalization structures with moderate reliance on debt
and ample asset protection.

-- Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

-- Well established access to a range of financial markets and assured
sources of alternate liquidity.

Standard & Poor's Rating Group describes its grades of corporate debt securities
and its "A" commercial paper as follows:

Bonds:

AAA Bonds rated AAA are highest grade obligations. They possess the
ultimate degree of protection as to principal and interest.
Marketwise they move with interest rates, and hence provide the
maximum safety on all counts.

AA Bonds rated AA also qualify as high grade obligations, and in the
majority of instances differ from AAA issues only in small
degree. Here, too, prices move with the long term money market.

A Bonds rated A are regarded as upper medium grade. They have
considerable investment strength but are not entirely free from
adverse effects of changes in economic and trade conditions.
Interest and principal are regarded as safe. They are
predominately reflect money rates in their market behavior, but
to some extent, also economic conditions.

Commercial paper:

POSSIBLE REPLACEMENT OF THE SERIES FUND

25
<PAGE>

conflict between variable life insurance and variable annuity contract owners
and to determine what action, if any, should be taken in response thereto.
Material conflicts could result from such things as: (1) changes in state
insurance law; (2) changes in federal income tax law; (3) changes in the
investment management of any portfolio of the Series Fund; or (4) difference
between voting instructions given by variable life insurance and variable
annuity contract owners. Prudential will bear the expense, if it does become
necessary, of remedying any material conflict including establishing a new
underlying investment company and segregating the assets held under variable
life insurance and variable annuity contracts.

OTHER INFORMATION CONCERNING THE SERIES FUND

INCORPORATION AND AUTHORIZED STOCK

The Series Fund was incorporated under Maryland law on November 15, 1982. The
authorized Capital Stock of the Series Fund consists of 2 billion shares, par
value $0.01 per share. The shares of Capital Stock are divided into fifteen
classes: MONEY MARKET PORTFOLIO Capital Stock (225 million shares), DIVERSIFIED
BOND PORTFOLIO Capital Stock (200 million shares), HIGH YIELD BOND PORTFOLIO
Capital Stock (100 million shares), GOVERNMENT INCOME PORTFOLIO Capital Stock
(100 million shares), EQUITY PORTFOLIO Capital Stock (200 million shares), STOCK
INDEX PORTFOLIO Capital Stock (100 million shares), EQUITY INCOME PORTFOLIO
Capital Stock (100 million shares), NATURAL RESOURCES PORTFOLIO Capital Stock
(100 million shares), GLOBAL PORTFOLIO Capital Stock (100 million shares),
CONSERVATIVE BALANCED PORTFOLIO Capital Stock (300 million shares), FLEXIBLE
MANAGED PORTFOLIO Capital Stock (300 million shares), ZERO COUPON BOND PORTFOLIO
2000 Capital Stock (25 million shares), ZERO COUPON BOND PORTFOLIO 2005 Capital
Stock (50 million shares), PRUDENTIAL JENNISON PORTFOLIO Capital Stock (50
million shares), SMALL CAPITALIZATION STOCK PORTFOLIO Capital Stock (50 million
shares). The shares of each portfolio, when issued, will be fully paid and
non-assessable, will have no conversion, exchange or similar rights, and will be
freely transferable. Each share of stock will have a pro rata interest in the
assets of the portfolio to which the stock of that class relates and will have
no interest in the assets of any other portfolio.

DIVIDENDS, DISTRIBUTIONS AND TAXES

CUSTODIAN, TRANSFER AGENT, AND DIVIDEND DISBURSING AGENT

EXPERTS

The financial statements of the Series Fund included in this statement of
additional information for the year ended December 31, 1996 and the FINANCIAL
HIGHLIGHTS and PORTFOLIO RATES OF RETURN included in the prospectus have been
audited by Price Waterhouse LLP, independent accountants, as stated in their
report appearing herein and are included in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing. Price
Waterhouse LLP's principal business address is 1177 Avenue of the Americas, New
York, New York 10036.

26
<PAGE>

in reliance upon the report of such firm given upon their authority as experts
in accounting and auditing. Deloitte & Touche LLP's principal business address
is Two Hilton Court, Parsippany, NJ 07054-0319.

LICENSE

27
<PAGE>

DIRECTORS AND OFFICERS OF PRUCO LIFE OF NEW JERSEY
AND MANAGEMENT OF THE SERIES FUND

DIRECTORS AND OFFICERS OF PRUCO LIFE OF NEW JERSEY

The directors and major officers of Pruco Life of New Jersey, listed with their
principal occupations during the past 5 years, are shown below.

DIRECTORS OF PRUCO LIFE OF NEW JERSEY

WILLIAM M. BETHKE, Director. -- President, Prudential Capital Markets Group
since 1992.

WILLIAM F. YELVERTON, Chairman and Director. --Chief Executive Officer,
Prudential Individual Insurance Group since 1995; Prior to 1995: Chief Executive
Officer, New York Life Worldwide.

OFFICERS WHO ARE NOT DIRECTORS

SUSAN L. BLOUNT, Secretary.--Vice President and Secretary of Prudential since
1995; Prior to 1995: Assistant General Counsel for Prudential Residential
Services Company.

MARIO A. MOSSE, Senior Vice President. -- Vice President, Annuity Services,
Prudential Investments since 1996; Prior to 1996: Vice President, Chase
Manhattan Bank.

SHIRLEY H. SHAO, Senior Vice President and Chief Actuary. -- Vice President and
Associate Actuary, Prudential.

KAREN L. SHAPIRO, Senior Vice President. -- Vice President, Prudential
Individual Insurance Group since 1996; Vice President and Associate General
Counsel, Prudential Securities Incorporated 1993 to 1996; Prior to 1993: Senior
Associate with Shaw, Pittman, Potts and Trowbridge.

The business address of all directors and officers of Pruco Life of New Jersey
is 213 Washington Street, Newark, New Jersey 07102-2992.

* SUBSIDIARY OF PRUDENTIAL

28
<PAGE>

MANAGEMENT OF THE SERIES FUND

DIRECTORS OF THE SERIES FUND

SAUL K. FENSTER, Director--President of New Jersey Institute of Technology.
Address: 323 Martin Luther King Boulevard, Newark, New Jersey 07102.

JOSEPH WEBER, Director--Vice President, Interclass (international corporate
learning). Address: 37 Beachmont Terrace, North Caldwell, New Jersey 07006.

OFFICERS WHO ARE NOT DIRECTORS

EUGENE STARK, Comptroller, Principal Financial Officer and Treasurer--Vice
President, Prudential Investments.

29
<PAGE>

FINANCIAL STATEMENTS OF THE PRUDENTIAL SERIES FUND, INC.

"A" pages to be inserted here

TO BE FILED PURSUANT TO RULE 485(B)

30
<PAGE>

THE PRUDENTIAL SERIES FUND, INC. SCHEDULE OF INVESTMENTS

"B" pages to be inserted here

TO BE FILED PURSUANT TO RULE 485(B)

<PAGE>

PART C

OTHER INFORMATION
<PAGE>

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements

Financial statements of The Prudential Series Fund, Inc. will be filed by
Post-Effective Amendment.

(b) Exhibits
<TABLE>
<S> <C>
(I)(1) Articles of Incorporation of The Prudential Series Fund, Incorporated by reference to Registrant's Form N-1A,
Inc. filed December 15, 1982.

(2) Supplemental Investment Advisory Agreement between The Incorporated by reference to Post-Effective
Prudential Insurance Company of America and The Prudential Amendment No. 28 to this Registration Statement,
Series Fund, Inc. filed February 1, 1995.

(3) Articles Supplementary to the Articles of Incorporation of Incorporated by reference to Post-Effective
The Prudential Series Fund, Inc. Amendment No. 19 to this Registration Statement,
filed March 1, 1990.

(4) Subadvisory Agreement between The Prudential Insurance Incorporated by reference to Post-Effective
Company of America and Jennison Associates Capital Corp. Amendment No. 28 to this Registration Statement,
filed February 1, 1995.

(ii) By-laws of The Prudential Series Fund, Inc., as amended Incorporated by reference to Post-Effective
February 16, 1990. Amendment No. 19 to this Registration Statement,
filed March 1, 1990.

(v)(1) Investment Advisory Agreement, as amended July 14, 1988 Incorporated by reference to Post-Effective
between The Prudential Insurance Company of America and The Amendment No. 16 to this Registration Statement,
Prudential Series Fund, Inc. filed September 1, 1988.

(2) Service Agreement between The Prudential Insurance Company Incorporated by reference to Post-Effective
of America and The Prudential Investment Corporation. Amendment No. 3 to this Registration Statement,
filed March 12, 1985.

(vi) Distribution Agreement between The Prudential Series Fund, Incorporated by reference to Post-Effective
Inc. and Pruco Securities Corporation. Amendment No. 20 to this Registration Statement,
filed April 26, 1990.

(viii)(1) Custodian Agreement between Chase Manhattan Bank (formerly Incorporated by reference to Post-Effective
Chemical Bank and Manufacturers Hanover Trust Company) and Amendment No. 6 to this Registration Statement,
The Prudential Series Fund, Inc. filed October 2, 1986.

(1)(a) Addendum #2 to Custodian Contract Between Chase Filed herewith.
Manhattan Bank and The Prudential Series Fund,
Inc.

(2) Custodian Agreement between Brown Brothers Incorporated by reference to Post-Effective
Harriman & Co. and The Prudential Series Fund, Amendment No. 16 to this Registration Statement,
Inc. filed September 1, 1988.

(ix)(1) Indemnification Agreement Regarding Reg. No. Incorporated by reference to Post-Effective
33-49994. Amendment No. 26 to this Registration Statement,
filed March 2, 1994.

(2) Indemnification Agreement Regarding Reg. No. Incorporated by reference to Post-Effective
33-57186. Amendment No. 26 to this Registration Statement,
filed March 2, 1994.

(xi)(1) Consent of Deloitte & Touche LLP independent To be filed by Post-Effective Amendment.
auditors.
</TABLE>

C-1
<PAGE>
<TABLE>
<S> <C>

(2) Consent of Price Waterhouse LLP independent To be filed by Post-Effective Amendment.
accountants.

(xvii) Powers of Attorney:

(a) Messrs. Caulfield, Fenster, McDonald, Incorporated by reference to Post-Effective
Melzer, Weber Amendment No. 31 to this Registration Statement,
filed April 26, 1996.

(b) Mr. Stark Filed herewith.

27. Financial Data Schedule To be filed by Post-Effective Amendment.

</TABLE>
C-2
<PAGE>

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT

All of Registrant's outstanding securities are owned by The Prudential Insurance
Company of America ("Prudential"), a mutual life insurance company organized
under the laws of New Jersey, and the following separate accounts which are
registered as unit investment trusts under the Investment Company Act of 1940
(the "Act"): The Prudential Variable Appreciable Account, The Prudential
Individual Variable Contract Account, The Prudential Qualified Individual
Variable Contract Account, The Prudential Variable Contract Account-24 (separate
accounts of Prudential); the Pruco Life Flexible Premium Variable Annuity
Account; the Pruco Life PRUvider Variable Appreciable Account; the Pruco Life
Variable Universal Account, the Pruco Life Variable Insurance Account, the Pruco
Life Variable Appreciable Account, the Pruco Life Single Premium Variable Life
Account, the Pruco Life Single Premium Variable Annuity Account (separate
accounts of Pruco Life Insurance Company ["Pruco Life"]); the Pruco Life of New
Jersey Flexible Premium Variable Annuity Account; the Pruco Life of New Jersey
Variable Insurance Account, the Pruco Life of New Jersey Variable Appreciable
Account, the Pruco Life of New Jersey Single Premium Variable Life Account, and
the Pruco Life of New Jersey Single Premium Variable Annuity Account (separate
accounts of Pruco Life Insurance Company of New Jersey ["Pruco Life of New
Jersey"]). Pruco Life, a corporation organized under the laws of Arizona, is a
direct wholly-owned subsidiary of Prudential. Pruco Life of New Jersey, a
corporation organized under the laws of New Jersey, is a direct wholly-owned
subsidiary of Pruco Life, and an indirect wholly-owned subsidiary of Prudential.

Registrant's shares will be voted in proportion to the directions of persons
having interests in the above-referenced separate accounts. Registrant may
nonetheless be deemed to be controlled by such entities by virtue of the
presumption contained in Section 2(a)(9) of the Act, although Registrant
disclaims such control.

The subsidiaries of Prudential are set forth in Schedule D of Prudential's
Annual Statement as shown on the following pages. In addition to those
subsidiaries, Prudential holds all of the voting securities of Prudential's
Gibraltar Fund, a Delaware corporation, in three of its separate accounts. The
Gibraltar Fund is registered as an open-end, diversified, management investment
company under the Act. The separate accounts are registered as unit investment
trusts under the Act. Registrant may also be deemed to be under common control
with The Prudential Variable Contract Account-2, The Prudential Variable
Contract Account-10, The Prudential Variable Account Contract Account-11,
(separate accounts of Prudential which are registered as open-end, diversified
management investment companies) and The Prudential Variable Contract Account-24
(separate account of Prudential which is registered as a unit investment trust
under the Act).

C-3
<PAGE>

<TABLE>

Form 1
ANNUAL STATEMENT FOR THE YEAR 1995 OF THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

SCHEDULE D -- PART 6 -- SECTION 1
<CAPTION>
Valuation of Shares of Subsidiary, Controlled or Affiliated Companies

<C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
| | 1 | 2 | 3 | 4 |
| | | | | Do Insurer's |
| | | NAIC | NAIC | Admitted Assets |
| CUSIP | Description | Company Code | Valuation |Include Intangible|
| Identi- | Name of Subsidiary, Controlled or | or | Method | Assets Connected |
| fication | Affiliated Company | Alien Insurer | (Sec. 5 (B) (a) | with Holding |
| | | Identification |of NAIC Purposes | of Such |
| | | Number |and Proc. Manual)| Company's Stock? |
|--------------|-------------------------------------------------------|----------------|-----------------|------------------|
| | PREFERRED STOCK - ALIEN INSURER | | | |
| 74429#120 |Prudential of America Life Ins. Co. (Canada) Class A | 68241 | 5(B)(a)(vi) | NO |
| 74429#138 |Prudential of America Life Ins. Co. (Canada) Class B | 68241 | 5(B)(a)(vi) | NO |
| 74429#146 |Prudential of America Life Ins. Co. (Canada) Class C | 68241 | 5(B)(a)(vi) | NO |
| 74429*116 |Prudential of America General Ins. Company (Canada) | AA-1560717 | 5(B)(a)(vi) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 0499999 PREFERRED STOCK - ALIEN INSURER |
|----------------------------------------------------------------------------------------------------------------------------|
| | PREFERRED STOCK - OTHER AFFILIATES | | | |
| 74438*115 |Prudential Timber Investments, Inc. | non-insurer | 5(B)(a)(vi) | NO |
| G6993*110 |PIC Holdings, Ltd. | non-insurer | 5(B)(a)(ii) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 0799999 PREFERRED STOCK - OTHER AFFILIATES |
|----------------------------------------------------------------------------------------------------------------------------|
| 0899999 TOTAL - PREFERRED STOCKS |
|----------------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCK - U.S. PROPERTY & CASUALTY INSURER | | | |
| 37465@108 |Gibraltar Casualty Company | 35947 | 5(B)(a)(iii) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 1099999 COMMON STOCK - U.S. PROPERTY & CASUALTY INSURER |
|----------------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCK - U.S. LIFE INSURER | | | |
| 74408#109 |Pruco Life Insurance Company | 79227 | 5(B)(a)(iii) | NO |
| 74445@106 |Prudential HealthCare and Life Insurance Co. of America| 74020 | 5(B)(a)(iii) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 1199999 COMMON STOCK - U.S. LIFE INSURER |
|----------------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCK - ALIEN INSURER | | | |
| E7415#105 |PRICOA Vida, Sociedad Anonima de Seguros y Reaseguros | AA-1840004 | 5(B)(a)(vii) | NO |
| T7415#109 |PRICOA Vita, S.p.A. | AA-1360003 | 5(B)(a)(vii) | YES |
| 74429*108 |Prudential of America General Ins. Company (Canada) | AA-1560717 | 5(B)(a)(vii) | NO |
| 74429#104 |Prudential of America Life Ins. (Canada) Series 1 | 68241 | 5(B)(a)(vii) | NO |
| 74429#112 |Prudential of America Life Ins. (Canada) Series 2 | 68241 | 5(B)(a)(vii) | NO |
| Y7443@101 |The Prudential Life Insurance Company of Korea, Ltd. | AA-0130001 | 5(B)(a)(vii) | NO |
| J7443#106 |The Prudential Life Insurance Company, Ltd. | AA-1580001 | 5(B)(a)(vii) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 1299999 COMMON STOCK - ALIEN INSURER |
|----------------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCK - INVESTMENT SUBSIDIARY | | | |
| 42223@101 |Health Ventures Partner | non-insurer | 5(B)(a)(i) | NO |
| 69337*109 |PIC Realty, Canada, Limited | non-insurer | 5(B)(a)(ii) | YES |
| 74430#101 |Prudential Mortgage Asset Corporation | non-insurer | 5(B)(a)(ii) | NO |
| 74430*105 |Prudential Mortgage Asset Corporation II | non-insurer | 5(B)(a)(ii) | NO |
| 74390@101 |Prudential Realty Securities II, Inc. | non-insurer | 5(B)(a)(i) | NO |
| 74446#103 |PruLease, Inc. | non-insurer | 5(B)(a)(i) | NO |
|----------------------------------------------------------------------------------------------------------------------------|
| 1499999 COMMON STOCK - INVESTMENT SUBSIDIARY |
|----------------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCK - OTHER AFFILIATES | | | |
| 45638*105 |Industrial Trust Company | non-insurer | 5(B)(a)(iv) | YES |
| 47620*101 |Jennison Associates Capital Corp. | non-insurer | 5(B)(a)(iv) | YES |
| 69332#100 |PGR Advisors I, Inc. | non-insurer | 5(B)(a)(i) | NO |
| G6933*102 |PIC Holdings, Ltd. | non-insurer | 5(B)(a)(ii) | YES |
| 74058*106 |PREMISYS Real Estate Services, Inc. | non-insurer | 5(B)(a)(i) | NO |
| 74408@101 |PRUCO, Inc. | non-insurer | 5(B)(a)(ii) | YES |
| 74445#104 |Prudential Direct Distributors, Inc. | non-insurer | 5(B)(a)(ii) | NO |
| 74433@100 |Prudential Fund Management Canada, Limited | non-insurer | 5(B)(a)(ii) | NO |
| 74446*107 |Prudential Global Funding, Inc. | non-insurer | 5(B)(a)(i) | NO |
| 74440@101 |Prudential Homes Corporation | non-insurer | 5(B)(a)(i) | NO |
| 74444*109 |Prudential Mutual Fund Management, Inc. | non-insurer | 5(B)(a)(ii) | NO |
| 74442@109 |Prudential Private Placement Investors, Inc. | non-insurer | 5(B)(a)(i) | NO |
| 74443@108 |Prudential Select Holdings, Inc. | non-insurer | 5(B)(a)(ii) | YES |
| 74441#108 |Prudential Service Bureau, Inc. | non-insurer | 5(B)(a)(i) | NO |
| 74441@100 |PruServicos Participacoes, S.A. | non-insurer | 5(B)(a)(vii) | NO |
| 76111#102 |Residential Services Corporation of America | non-insurer | 5(B)(a)(iv) | YES |
| 74437#104 |The Prudential Investment Corporation | non-insurer | 5(B)(a)(ii) | NO |
| 74390*103 |The Prudential Real Estate Affiliates, Inc. | non-insurer | 5(B)(a)(ii) | YES |
| 91204*103 |U.S. High Yield Management Company | non-insurer | 5(B)(a)(i) | NO |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
|----------------------------------------------------------------------------------------------------------------------------|
| 1599999 COMMON STOCK - OTHER AFFILIATES |
|----------------------------------------------------------------------------------------------------------------------------|
| 1699999 TOTAL - COMMON STOCKS |
|----------------------------------------------------------------------------------------------------------------------------|
| 1799999 TOTAL - PREFERRED AND COMMON STOCKS |
- ------------------------------------------------------------------------------------------------------------------------------

<PAGE>

<C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------------
| | 1 | 5 | 6 | Stock of Such |
| | | | | Company Owned by |
| | | If Yes, | |Insurer on Statement Date|
| CUSIP | Description | Amount of | Statement | |
| Identi- | Name of Subsidiary, Controlled or | Such | Value |-------------------------|
| fication | Affiliated Company | Intangible | | 7 | 8 |
| | | Assets | | No. of | % of |
| | | | | Shares |Outstanding |
|--------------|-------------------------------------------------------|-------------|---------------|------------|------------|
| | PREFERRED STOCK - ALIEN INSURER | | | | |
| 74429#120 |Prudential of America Life Ins. Co. (Canada) Class A | N/A | 6,545,454 | 60,000 | 100 |
| 74429#138 |Prudential of America Life Ins. Co. (Canada) Class B | N/A | 9,681,818 | 88,750 | 100 |
| 74429#146 |Prudential of America Life Ins. Co. (Canada) Class C | N/A | 10,909,090 | 100,000 | 100 |
| 74429*116 |Prudential of America General Ins. Company (Canada) | N/A | 10,000,000 | 100,000 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 0499999 PREFERRED STOCK - ALIEN INSURER 0 | 37,136,362 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | PREFERRED STOCK - OTHER AFFILIATES | | | | |
| 74438*115 |Prudential Timber Investments, Inc. | N/A | 875,461 | 7 | 100 |
| G6993*110 |PIC Holdings, Ltd. | N/A | 11,873,000 | 7,750,000 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 0799999 PREFERRED STOCK - OTHER AFFILIATES 0 | 12,748,461 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 0899999 TOTAL - PREFERRED STOCKS 0 | 0 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | COMMON STOCK - U.S. PROPERTY & CASUALTY INSURER | | | | |
| 37465@108 |Gibraltar Casualty Company | N/A | 20,947,158 | 2,000 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 1099999 COMMON STOCK - U.S. PROPERTY & CASUALTY INSURER 0 | 20,947,158 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | COMMON STOCK - U.S. LIFE INSURER | | | | |
| 74408#109 |Pruco Life Insurance Company | N/A | 833,277,789 | 250,000 | 100 |
| 74445@106 |Prudential HealthCare and Life Insurance Co. of America| N/A | 9,840,532 | 500,000 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 1199999 COMMON STOCK - U.S. LIFE INSURER 0 | 843,118,321 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | COMMON STOCK - ALIEN INSURER | | | | |
| E7415#105 |PRICOA Vida, Sociedad Anonima de Seguros y Reaseguros | N/A | 3,441,206 | 63,662 | 100 |
| T7415#109 |PRICOA Vita, S.p.A. | 700,380 | 4,308,314 | 20,000,000 | 100 |
| 74429*108 |Prudential of America General Ins. Company (Canada) | N/A | 34,499,000 | 183,436 | 100 |
| 74429#104 |Prudential of America Life Ins. (Canada) Series 1 | N/A | (5,917,508)| 25,000 | 100 |
| 74429#112 |Prudential of America Life Ins. (Canada) Series 2 | N/A | (311,448)| 12,500 | 50 |
| Y7443@101 |The Prudential Life Insurance Company of Korea, Ltd. | N/A | 21,021,792 | 2,640,000 | 100 |
| J7443#106 |The Prudential Life Insurance Company, Ltd. | N/A | 73,756,384 | 100,000 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 1299999 COMMON STOCK - ALIEN INSURER 700,380 | 130,797,740 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | COMMON STOCK - INVESTMENT SUBSIDIARY | | | | |
| 42223@101 |Health Ventures Partner | N/A | 23,025,205 | 1,000 | 100 |
| 69337*109 |PIC Realty, Canada, Limited | 285,715 | 33,499,753 | 16,561,003 | 100 |
| 74430#101 |Prudential Mortgage Asset Corporation | N/A | (3,426,000)| 1,000 | 100 |
| 74430*105 |Prudential Mortgage Asset Corporation II | N/A | 49,000 | 500 | 50 |
| 74390@101 |Prudential Realty Securities II, Inc. | N/A | 126,565,461 | 115 | 87 |
| 74446#103 |PruLease, Inc. | N/A | 167,451,432 | 3,100 | 100 |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| 1499999 COMMON STOCK - INVESTMENT SUBSIDIARY 285,715 | 347,164,851 | X X X | X X X |
|------------------------------------------------------------------------------------|---------------|------------|------------|
| | COMMON STOCK - OTHER AFFILIATES | | | | |
| 45638*105 |Industrial Trust Company | 2,379 | 89,653 | 451 | 100 |
| 47620*101 |Jennison Associates Capital Corp. | 11,255,718 | 27,833,378 | 913,498 | 100 |
| 69332#100 |PGR Advisors I, Inc. | N/A | 967,467 | 100 | 100 |
| G6933*102 |PIC Holdings, Ltd. | 2,078,209 | 53,781,433 | 27,826,498 | 100 |
| 74058*106 |PREMISYS Real Estate Services, Inc. | N/A | (3,274,892)| 97 | 100 |
| 74408@101 |PRUCO, Inc. | 11,452,264 | 2,536,645,866 | 94 | 100 |
| 74445#104 |Prudential Direct Distributors, Inc. | N/A | 50,000 | 100 | 100 |
| 74433@100 |Prudential Fund Management Canada, Limited | N/A | 1,146,261 | 50,000 | 100 |
| 74446*107 |Prudential Global Funding, Inc. | N/A | 15,562,582 | 100 | 100 |
| 74440@101 |Prudential Homes Corporation | N/A | 5,950,735 | 1 | 100 |
| 74444*109 |Prudential Mutual Fund Management, Inc. | N/A | 17,144,146 | 150 | 15 |
| 74442@109 |Prudential Private Placement Investors, Inc. | N/A | 39,737 | 40,000 | 100 |
| 74443@108 |Prudential Select Holdings, Inc. | 1,262,549 | 20,113,528 | 44,977 | 100 |
| 74441#108 |Prudential Service Bureau, Inc. | N/A | 7,973,150 | 100 | 100 |
| 74441@100 |PruServicos Participacoes, S.A. | N/A | 7,623,745 | 422,168 | 100 |
| 76111#102 |Residential Services Corporation of America | 489,000 | 79,283,081 | 1,000 | 100 |
| 74437#104 |The Prudential Investment Corporation | N/A | 201,442,158 | 86 | 100 |
| 74390*103 |The Prudential Real Estate Affiliates, Inc. | 12,429,000 | 13,851,957 | 100 | 100 |
| 91204*103 |U.S. High Yield Management Company | N/A | 1,000 | 100 | 100 |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
|----------------------------------------------------------------------|-------------|---------------|------------|------------|
| 1599999 COMMON STOCK - OTHER AFFILIATES | 38,969,119 | 2,986,224,985 | X X X | X X X |
|----------------------------------------------------------------------|-------------|---------------|------------|------------|
| 1699999 TOTAL - COMMON STOCKS | 39,955,214 | 4,328,253,055 | X X X | X X X |
|----------------------------------------------------------------------|-------------|---------------|------------|------------|
| 1799999 TOTAL - PREFERRED AND COMMON STOCKS | 39,955,214 | 4,378,137,878 | X X X | X X X |
- --------------------------------------------------------------------------------------------------------------------------------

(a) Total of Line 1799999, col. 5 does not include intangible assets of $34,538,000 of Prudential Residential Services, L.P.
which is a partnership reported on Schedule BA.

Amount of Insurer's Capital and Surplus (Page 3, Line 38 of previous year's statement filed by the insurer with its
domiciliary insurance dept.): $7,448,951,321 .

Note: Includes only affiliates that are subsidiaries as defined by the New Jersey Statute 17B:20-4.; that is, where
a majority of the voting stock is owned or controlled, direclty or indirectly.

</TABLE>
C-4
<PAGE>

<TABLE>

Form 1
ANNUAL STATEMENT FOR THE YEAR 1995 OF THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

SCHEDULE D -- PART 6 -- SECTION 2
<CAPTION>

<S> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
| | | |
| | | |
| | 1 | 2 |
| | | |
| CUSIP | | Name of Company Listed in |
|Identi- | Name of Lower-tier Company | Section 1 Which Controls Lower-tier |
|fication| | Company |
| | | |
|--------|--------------------------------------------------------|-----------------------------------------------------|
| | PREFERRED STOCKS | |
| | Clivwell Securities, Ltd. | PIC Holdings, Ltd. |
| | PRICOA Investment Company | PIC Holdings, Ltd. |
| | Prudential Capital and Investment Services, Inc. | PRUCO, Inc. |
| | Lapine Holding Company | PRUCO, Inc. |
| | Prudential Securities Group, Inc. | PRUCO, Inc. |
| | Prudential Asia Investments Limited | PRUCO, Inc. |
| | The Prudential Asset Management Company, Inc. | The Prudential Investment Corporation |
| | Prudential Asia Investments Limited | The Prudential Investment Corporation |
|-----------------------------------------------------------------------------------------------------------------------|
| 0199999 PREFERRED STOCKS |
|-----------------------------------------------------------------------------------------------------------------------|
| | COMMON STOCKS | |
| | Major Escrow Corp. | (a) Prudential Residential Services, L.P. |
| | ML/MSB Acquisition, Inc. | Prudential Residential Services, L.P. |
| | PRICOA Relocation Management, Ltd. | Prudential Residential Services, L.P. |
| | PRS Escrow Services, Inc. | Prudential Residential Services, L.P. |
| | Prudential Community Interaction Consulting, Inc. | Prudential Residential Services, L.P. |
| | Prudential New York Homes Corporation | Prudential Residential Services, L.P. |
| | Prudential Relocation Management Company of Canada Ltd.| Prudential Residential Services, L.P. |
| | Prudential Resources Management Asia, Limited | Prudential Residential Services, L.P. |
| | The Relocation Funding Corporation of America | Prudential Residential Services, L.P. |
| | JACC Services Corp. | Jennison Associates Capital Corp. |
| | Clivwell Securities, Ltd. | PIC Holdings, Ltd. |
| | PRICOA Capital Group, Ltd. | PIC Holdings, Ltd. |
| | PRICOA Funding, Ltd. | PIC Holdings, Ltd. |
| | PRICOA Investment Company | PIC Holdings, Ltd. |
| | PRICOA Property Investment Management Limited | PIC Holdings, Ltd. |
| | Northern Retail Properties (General Partner) Limited | PIC Holdings, Ltd. |
| | PRICOA P.I.M. (Regulated) Ltd. | PIC Holdings, Ltd. |
| | TransEuropean Properties (General Partner) Ltd. | PIC Holdings, Ltd. |
| | PRICOA Realty Group Ltd. | PIC Holdings, Ltd. |
| | PREMISYS Real Estate Services, Inc. of Colorado | PREMISYS Real Estate Services, Inc. |
| | PRICOA Invest Sociedad Anonima, S.G.C. | PRICOA Vida, Sociedad Anonima de Seguros y Reaseguro|
| | Capital Agricultural Property Services, Inc. | PRUCO, Inc. |
| | Flor-Ag Corporation | PRUCO, Inc. |
| | P.G. Realty, Inc. | PRUCO, Inc. |
| | PIC Realty Corporation | PRUCO, Inc. |
| | PRICOA Vida, Sociedad Anonima de Seguros y Reaseguros | PRUCO, Inc. |
| | Pruco Securities Corporation | PRUCO, Inc. |
| | GIB Laboratories, Inc. | PRUCO, Inc. |
| | Prudential Agricultural Credit, Inc. | PRUCO, Inc. |
| | Prudential Capital and Investment Services, Inc. | PRUCO, Inc. |
| | Lapine Holding Company | PRUCO, Inc. |
| | Lapine Technology Corporation | PRUCO, Inc. |
| | Prudential Securities Group Inc. - Series A | PRUCO, Inc. |
| | Prudential Securities Group Inc. - Series B | PRUCO, Inc. |
| | Bache Insurance Agency of Arkansas, Inc. | PRUCO, Inc. |
| | Bache Insurance Agency of Louisiana, Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Germany) Inc. | PRUCO, Inc. |
| | BraeLoch Successor Corporation | PRUCO, Inc. |
| | BraeLoch Holdings, Inc. | PRUCO, Inc. |
| | Graham Resources, Inc. | PRUCO, Inc. |
| | Graham Depository Company II | PRUCO, Inc. |
| | Graham Energy, Ltd. | PRUCO, Inc. |
| | Graham Exploration, Ltd. | PRUCO, Inc. |
| | Graham Royalty, Ltd. | PRUCO, Inc. |
| | Graham Production Company | PRUCO, Inc. |
| | Graham Securities Corporation | PRUCO, Inc. |
| | PB Bullion Company, Inc. | PRUCO, Inc. |
| | PB Services (U.K.) | PRUCO, Inc. |
| | PGR Advisors, Inc. | PRUCO, Inc. |
| | Prudential-Bache Agriculture Inc. | PRUCO, Inc. |
| | PBML Custodian Limited | PRUCO, Inc. |
| | Prudential-Bache Capital Funding BV | PRUCO, Inc. |
| | Audley Finance BV | PRUCO, Inc. |
| | Prudential-Bache Energy Corp. | PRUCO, Inc. |
| | Prudential-Bache Energy Production Inc. | PRUCO, Inc. |
| | Prudential-Bache Holdings Inc. | PRUCO, Inc. |
| | Prudential-Bache Partners Inc. | PRUCO, Inc. |
| | Prudential-Bache International Bank S.A. | PRUCO, Inc. |
| | Prudential-Bache International (U.K.) Limited | PRUCO, Inc. |
| | Page & Gwyther Holdings Limited | PRUCO, Inc. |
| | Page & Gwyther Limited | PRUCO, Inc. |
| | Prudential-Bache Capital Funding (Equities) Ltd. | PRUCO, Inc. |
| | Circle (Nominees) Limited | PRUCO, Inc. |
| | Prudential-Bache Capital Funding (Gilts) Limited | PRUCO, Inc. |
| | Prudential-Bache Capital Funding (Money Brokers) | |
| | Limited | PRUCO, Inc. |
| | Prudential-Bache (Futures) Limited | PRUCO, Inc. |
| | Prudential-Bache Investor Services Inc. | PRUCO, Inc. |
| | Prudential-Bache Investor Services II, Inc. | PRUCO, Inc. |
| | Prudential-Bache Leasing Inc. | PRUCO, Inc. |
| | Prudential-Bache Minerals Inc. | PRUCO, Inc. |
| | Prudential-Bache Program Services Inc. | PRUCO, Inc. |
| | Prudential-Bache Properties Inc. | PRUCO, Inc. |
| | Prudential-Bache Real Estate, Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Australia) Limited | PRUCO, Inc. |
| | Bache Nominees Ltd. | PRUCO, Inc. |
| | Corcarr Funds Management Limited | PRUCO, Inc. |
| | Corcarr Management Pty. Limited | PRUCO, Inc. |
- -------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
| | | | Stock in Lower-tier |
| | | | Company Owned |
| | 1 | 3 | Indirectly by Insurer |
| | | | on Statement Date |
| CUSIP | | Amount of Intangible |-------------------------|
|Identi- | Name of Lower-tier Company | Assets Included in | 4 | 5 |
|fication| | Amount Shown in | No. of | % of |
| | | Column 5, Section 1 | Shares |Outstanding |
|--------|--------------------------------------------------------|------------------------|------------|------------|
| | PREFERRED STOCKS | | | |
| | Clivwell Securities, Ltd. | N/A | 7,750,000 | 100 |
| | PRICOA Investment Company | N/A | 96,238,075 | 100 |
| | Prudential Capital and Investment Services, Inc. | N/A | N/A | N/A |
| | Lapine Holding Company | N/A | 7,499,999 | 100 |
| | Prudential Securities Group, Inc. | N/A | N/A | N/A |
| | Prudential Asia Investments Limited | N/A | 12,500,000 | 50 |
| | The Prudential Asset Management Company, Inc. | N/A | N/A | N/A |
| | Prudential Asia Investments Limited | N/A | 12,500,000 | 50 |
|------------------------------------------------------------------------------------------|------------|------------|
| 0199999 PREFERRED STOCKS 0 | X X X | X X X |
|------------------------------------------------------------------------------------------|------------|------------|
| | COMMON STOCKS | | | |
| | Major Escrow Corp. | N/A | 1,000 | 100 |
| | ML/MSB Acquisition, Inc. | N/A | 1,000 | 100 |
| | PRICOA Relocation Management, Ltd. | N/A | 99 | 100 |
| | PRS Escrow Services, Inc. | N/A | 375 | 100 |
| | Prudential Community Interaction Consulting, Inc. | N/A | 1,000 | 100 |
| | Prudential New York Homes Corporation | N/A | 1,000 | 100 |
| | Prudential Relocation Management Company of Canada Ltd.| N/A | 1,000 | 100 |
| | Prudential Resources Management Asia, Limited | N/A | 10,000 | 100 |
| | The Relocation Funding Corporation of America | N/A | 1,000 | 100 |
| | JACC Services Corp. | N/A | 100,000 | 100 |
| | Clivwell Securities, Ltd. | N/A | 13,266,766 | 100 |
| | PRICOA Capital Group, Ltd. | N/A | 2,751,000 | 100 |
| | PRICOA Funding, Ltd. | N/A | 9,658,832 | 100 |
| | PRICOA Investment Company | N/A | 15,000 | 100 |
| | PRICOA Property Investment Management Limited | 2,078,209 | 2 | 100 |
| | Northern Retail Properties (General Partner) Limited | N/A | 10,000 | 100 |
| | PRICOA P.I.M. (Regulated) Ltd. | N/A | 10,000 | 100 |
| | TransEuropean Properties (General Partner) Ltd. | N/A | 40,000 | 100 |
| | PRICOA Realty Group Ltd. | N/A | 150,010 | 100 |
| | PREMISYS Real Estate Services, Inc. of Colorado | N/A | 80 | 80 |
| | PRICOA Invest Sociedad Anonima, S.G.C. | N/A | 222,050 | 100 |
| | Capital Agricultural Property Services, Inc. | 485,202 | 95 | 100 |
| | Flor-Ag Corporation | N/A | 50 | 100 |
| | P.G. Realty, Inc. | N/A | 2,500 | 100 |
| | PIC Realty Corporation | N/A | 236 | 100 |
| | PRICOA Vida, Sociedad Anonima de Seguros y Reaseguros | N/A | 26 |less than 1 |
| | Pruco Securities Corporation | N/A | 995 | 100 |
| | GIB Laboratories, Inc. | N/A | 50,000 | 100 |
| | Prudential Agricultural Credit, Inc. | N/A | 999 | 100 |
| | Prudential Capital and Investment Services, Inc. | N/A | 99 | 100 |
| | Lapine Holding Company | N/A | 12,499,999 | 71 |
| | Lapine Technology Corporation | N/A | 1 | 100 |
| | Prudential Securities Group Inc. - Series A | 6,832,173 | 100 | 100 |
| | Prudential Securities Group Inc. - Series B | N/A | 57 | 100 |
| | Bache Insurance Agency of Arkansas, Inc. | N/A | 100 | 100 |
| | Bache Insurance Agency of Louisiana, Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Germany) Inc. | N/A | 100 | 100 |
| | BraeLoch Successor Corporation | N/A | 330,000 | 100 |
| | BraeLoch Holdings, Inc. | N/A | 7,758,803 | 100 |
| | Graham Resources, Inc. | N/A | 7,734,234 | 100 |
| | Graham Depository Company II | N/A | 1,000 | 100 |
| | Graham Energy, Ltd. | N/A | 90 | 100 |
| | Graham Exploration, Ltd. | N/A | 130 | 100 |
| | Graham Royalty, Ltd. | N/A | 20 | 100 |
| | Graham Production Company | N/A | 50 | 100 |
| | Graham Securities Corporation | N/A | 20,000 | 100 |
| | PB Bullion Company, Inc. | N/A | 50 | 100 |
| | PB Services (U.K.) | N/A | 56,600,000 | 100 |
| | PGR Advisors, Inc. | N/A | 1,000 | 100 |
| | Prudential-Bache Agriculture Inc. | N/A | 100 | 100 |
| | PBML Custodian Limited | N/A | 5,000,000 | 100 |
| | Prudential-Bache Capital Funding BV | N/A | 40,000 | 100 |
| | Audley Finance BV | N/A | 40,000 | 100 |
| | Prudential-Bache Energy Corp. | N/A | 1 | 100 |
| | Prudential-Bache Energy Production Inc. | N/A | 100 | 100 |
| | Prudential-Bache Holdings Inc. | N/A | 50 | 100 |
| | Prudential-Bache Partners Inc. | N/A | 1 | 100 |
| | Prudential-Bache International Bank S.A. | N/A | 6,000 | 100 |
| | Prudential-Bache International (U.K.) Limited | N/A | 21,456,265 | 100 |
| | Page & Gwyther Holdings Limited | N/A | 2,000,000 | 100 |
| | Page & Gwyther Limited | N/A | 3,000,000 | 100 |
| | Prudential-Bache Capital Funding (Equities) Ltd. | N/A | 11,500,000 | 100 |
| | Circle (Nominees) Limited | N/A | 2 | 100 |
| | Prudential-Bache Capital Funding (Gilts) Limited | N/A | 25,000,000 | 100 |
| | Prudential-Bache Capital Funding (Money Brokers) | | | |
| | Limited | N/A | 10,000,000 | 100 |
| | Prudential-Bache (Futures) Limited | N/A | 7,500,000 | 100 |
| | Prudential-Bache Investor Services Inc. | N/A | 100 | 100 |
| | Prudential-Bache Investor Services II, Inc. | N/A | 100 | 100 |
| | Prudential-Bache Leasing Inc. | N/A | 500 | 100 |
| | Prudential-Bache Minerals Inc. | N/A | 100 | 100 |
| | Prudential-Bache Program Services Inc. | N/A | 100 | 100 |
| | Prudential-Bache Properties Inc. | N/A | 1 | 100 |
| | Prudential-Bache Real Estate, Inc. | N/A | 5,000 | 100 |
| | Prudential-Bache Securities (Australia) Limited | N/A | 10,000,000 | 100 |
| | Bache Nominees Ltd. | N/A | 4 | 100 |
| | Corcarr Funds Management Limited | N/A | 50,050 | 100 |
| | Corcarr Management Pty. Limited | N/A | 2 | 100 |
- ----------------------------------------------------------------------------------------------------------------------

(a) Prudential Residential Services, L.P. is a partnership which is reported on Schedule BA.

Groups of companies which are indented are owned by the company listed immediately above that
group in the percentages indicated.

</TABLE>
C-5
<PAGE>

<TABLE>

Form 1
ANNUAL STATEMENT FOR THE YEAR 1995 OF THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

SCHEDULE D -- PART 6 -- SECTION 2
<CAPTION>

<S> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
| | | |
| | | |
| | 1 | 2 |
| | | |
| CUSIP | | Name of Company Listed in |
|Identi- | Name of Lower-tier Company | Section 1 Which Controls Lower-tier |
|fication| | Company |
| | | |
|--------|--------------------------------------------------------|-----------------------------------------------------|
| | Corcarr Nominees Pty. Limited | PRUCO, Inc. |
| | Corcarr Superannuation Pty. Limited | PRUCO, Inc. |
| | Divsplit Nominees Pty. Limited | PRUCO, Inc. |
| | PruBache Nominees Pty. Limited | PRUCO, Inc. |
| | Prudential-Bache Trade Services Inc. | PRUCO, Inc. |
| | PB Trade Ltd. | PRUCO, Inc. |
| | Prudential-Bache Forex (USA) Inc. | PRUCO, Inc. |
| | Prudential-Bache Forex (Hong Kong) Limited | PRUCO, Inc. |
| | Prudential-Bache Forex (U.K.) Limited | PRUCO, Inc. |
| | Prudential-Bache Transfer Agent Services, Inc. | PRUCO, Inc. |
| | Prudential Securities Incorporated | PRUCO, Inc. |
| | Bache & Co. (Lebanon) S.A.L. | PRUCO, Inc. |
| | Bache & Co. S.A. de C.V. (Mexico) | PRUCO, Inc. |
| | Bache Halsey Stuart Shields (Antilles) N.V. | PRUCO, Inc. |
| | Bache Insurance Agency Incorporated | PRUCO, Inc. |
| | Bache Insurance of Arizona Inc. | PRUCO, Inc. |
| | Bache Insurance of Kentucky, Inc. | PRUCO, Inc. |
| | Bache Shields Securities Corporation | PRUCO, Inc. |
| | Banom Corporation | PRUCO, Inc. |
| | Gelfand, Quinn & Associates, Inc. | PRUCO, Inc. |
| | P-B Holding Japan Inc. | PRUCO, Inc. |
| | Prudential Securities (Japan) Ltd. | PRUCO, Inc. |
| | Prudential-Bache Futures Asia Pacific Ltd. | PRUCO, Inc. |
| | Prudential-Bache Futures (Hong Kong) Limited | PRUCO, Inc. |
| | Prudential-Bache Nominees (Hong Kong) Limited | PRUCO, Inc. |
| | Prudential-Bache Securities Asia Pacific Ltd. | PRUCO, Inc. |
| | Prudential-Bache Securities (Belgium) Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Espana) S.A. | PRUCO, Inc. |
| | Prudential-Bache Securities (France) S.A. | PRUCO, Inc. |
| | Prudential-Bache Securities (Holland) Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Holland) N.V. | PRUCO, Inc. |
| | Prudential-Bache Securities (Hong Kong) Limited | PRUCO, Inc. |
| | Prudential-Bache Securities (Luxembourg) Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Monaco) Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (Switzerland) Inc. | PRUCO, Inc. |
| | Prudential-Bache Securities (U.K.) Inc. | PRUCO, Inc. |
| | Shields Model Roland Company | PRUCO, Inc. |
| | Prudential Mutual Fund Management, Inc. | PRUCO, Inc. |
| | Prudential Mutual Fund Distributors, Inc. | PRUCO, Inc. |
| | Prudential Mutual Fund Investment | |
| | Management, Inc. | PRUCO, Inc. |
| | Prudential Mutual Fund Services, Inc. | PRUCO, Inc. |
| | Prudential Securities (Chile) Inc. | PRUCO, Inc. |
| | Prudential Securities CMO Issuer Inc. | PRUCO, Inc. |
| | Prudential Securities Futures Management Inc. | PRUCO, Inc. |
| | Prudential Securities (South America) Inc. | PRUCO, Inc. |
| | Prudential Securities (Argentina) Inc. | PRUCO, Inc. |
| | Prudential Securities (Uruguay) S.A. | PRUCO, Inc. |
| | Shields Model Roland Securities Incorporated | PRUCO, Inc. |
| | Prudential Securities Lease Holding Inc. | PRUCO, Inc. |
| | Prudential Securities Municipal Derivatives, Inc. | PRUCO, Inc. |
| | Prudential Securities Realty Funding Corporation | PRUCO, Inc. |
| | Prudential Securities Secured Financing Corporation| PRUCO, Inc. |
| | Prudential Securities Structured Assets, Inc. | PRUCO, Inc. |
| | P-B Finance Ltd. | PRUCO, Inc. |
| | R & D Funding Corp. | PRUCO, Inc. |
| | Special Situations Management Inc. | PRUCO, Inc. |
| | Seaport Futures Management, Inc. | PRUCO, Inc. |
| | Wexford Clearing Services Corporation | PRUCO, Inc. |
| | Prudential Dental Maintenance Organization, Inc. | PRUCO, Inc. |
| | Prudential Direct, Inc. | PRUCO, Inc. |
| | Prudential Equity Investors, Inc. | PRUCO, Inc. |
| | Prudential Funding Corporation | PRUCO, Inc. |
| | Prudential Health Care Plan, Inc. | PRUCO, Inc. |
| | Prudential Health Care Plan of California, Inc. | PRUCO, Inc. |
| | Prudential Health Care Plan of Connecticut, Inc. | PRUCO, Inc. |
| | Prudential Health Care Plan of Georgia, Inc. | PRUCO, Inc. |
| | Prudential Health Care Plan of New York, Inc. | PRUCO, Inc. |
| | Prudential Institutional Fund Management, Inc. | PRUCO, Inc. |
| | Prudential Holdings, Inc. | PRUCO, Inc. |
| | Prudential Property and Casualty Insurance Company | PRUCO, Inc. |
| | Prudential Commercial Insurance Company | PRUCO, Inc. |
| | Prudential General Insurance Company | PRUCO, Inc. |
| | Prudential Insurance Brokerage, Inc. | PRUCO, Inc. |
| | The Prudential Property and Casualty General | |
| | Agency, Inc. | PRUCO, Inc. |
| | The Prudential Property and Casualty Insurance Company | |
| | of New Jersey | PRUCO, Inc. |
| | Prudential Realty Partnerships, Inc. | PRUCO, Inc. |
| | Prudential Realty Securities, Inc. | PRUCO, Inc. |
| | Prudential Realty Securities II, Inc. | PRUCO, Inc. |
| | Prudential Retirement Services, Inc. | PRUCO, Inc. |
| | PruServicos Participacoes, S.A. | PRUCO, Inc. |
| | Prudential Trust Company | PRUCO, Inc. |
| | PTC Services, Inc. | PRUCO, Inc. |
| | Prudential Uniformed Services Administrators, Inc. | PRUCO, Inc. |
| | The Prudential Bank and Trust Company | PRUCO, Inc. |
| | PBT Mortgage Corporation | PRUCO, Inc. |
| | The Prudential Savings Bank, F.S.B. | PRUCO, Inc. |
| | PBT Home Equity Holdings | PRUCO, Inc. |
| | Pruco Life Insurance Company of New Jersey | Pruco Life Insurance Company |
| | The Prudential Life Insurance Company of Arizona | Pruco Life Insurance Company |
- -------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
| | | | Stock in Lower-tier |
| | | | Company Owned |
| | 1 | 3 | Indirectly by Insurer |
| | | | on Statement Date |
| CUSIP | | Amount of Intangible |-------------------------|
|Identi- | Name of Lower-tier Company | Assets Included in | 4 | 5 |
|fication| | Amount Shown in | No. of | % of |
| | | Column 5, Section 1 | Shares |Outstanding |
|--------|--------------------------------------------------------|------------------------|------------|------------|
| | Corcarr Nominees Pty. Limited | N/A | 4 | 100 |
| | Corcarr Superannuation Pty. Limited | N/A | 4 | 100 |
| | Divsplit Nominees Pty. Limited | N/A | 4 | 100 |
| | PruBache Nominees Pty. Limited | N/A | 2 | 100 |
| | Prudential-Bache Trade Services Inc. | N/A | 1,000 | 100 |
| | PB Trade Ltd. | N/A | 100,000 | 100 |
| | Prudential-Bache Forex (USA) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Forex (Hong Kong) Limited | N/A | 1,502 | 100 |
| | Prudential-Bache Forex (U.K.) Limited | N/A | 3,000,000 | 100 |
| | Prudential-Bache Transfer Agent Services, Inc. | N/A | 10,000 | 100 |
| | Prudential Securities Incorporated | N/A | 1,200 | 100 |
| | Bache & Co. (Lebanon) S.A.L. | N/A | 2,000 | 100 |
| | Bache & Co. S.A. de C.V. (Mexico) | N/A | 96 | 100 |
| | Bache Halsey Stuart Shields (Antilles) N.V. | N/A | 10 | 100 |
| | Bache Insurance Agency Incorporated | N/A | 100 | 100 |
| | Bache Insurance of Arizona Inc. | N/A | 100 | 100 |
| | Bache Insurance of Kentucky, Inc. | N/A | 100 | 100 |
| | Bache Shields Securities Corporation | N/A | 1,200 | 100 |
| | Banom Corporation | N/A | 5 | 100 |
| | Gelfand, Quinn & Associates, Inc. | N/A | 100 | 100 |
| | P-B Holding Japan Inc. | N/A | 1,000 | 100 |
| | Prudential Securities (Japan) Ltd. | N/A | 200,000 | 100 |
| | Prudential-Bache Futures Asia Pacific Ltd. | N/A | 100 | 100 |
| | Prudential-Bache Futures (Hong Kong) Limited | N/A | 1,499 | 100 |
| | Prudential-Bache Nominees (Hong Kong) Limited | N/A | 1,750 | 100 |
| | Prudential-Bache Securities Asia Pacific Ltd. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Belgium) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Espana) S.A. | N/A | 10,000 | 100 |
| | Prudential-Bache Securities (France) S.A. | N/A | 839 | 100 |
| | Prudential-Bache Securities (Holland) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Holland) N.V. | N/A | 40,000 | 100 |
| | Prudential-Bache Securities (Hong Kong) Limited | N/A | 49,999 | 100 |
| | Prudential-Bache Securities (Luxembourg) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Monaco) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (Switzerland) Inc. | N/A | 100 | 100 |
| | Prudential-Bache Securities (U.K.) Inc. | N/A | 200 | 100 |
| | Shields Model Roland Company | N/A | 15,000 | 100 |
| | Prudential Mutual Fund Management, Inc. | N/A | 850 | 85 |
| | Prudential Mutual Fund Distributors, Inc. | N/A | 100 | 100 |
| | Prudential Mutual Fund Investment | | | |
| | Management, Inc. | N/A | 100 | 100 |
| | Prudential Mutual Fund Services, Inc. | N/A | 100 | 100 |
| | Prudential Securities (Chile) Inc. | N/A | 100 | 100 |
| | Prudential Securities CMO Issuer Inc. | N/A | 100 | 100 |
| | Prudential Securities Futures Management Inc. | N/A | 100 | 100 |
| | Prudential Securities (South America) Inc. | N/A | 100 | 100 |
| | Prudential Securities (Argentina) Inc. | N/A | 100 | 100 |
| | Prudential Securities (Uruguay) S.A. | N/A | 100 | 100 |
| | Shields Model Roland Securities Incorporated | N/A | 10 | 100 |
| | Prudential Securities Lease Holding Inc. | N/A | 20 | 100 |
| | Prudential Securities Municipal Derivatives, Inc. | N/A | 100 | 100 |
| | Prudential Securities Realty Funding Corporation | N/A | 100 | 100 |
| | Prudential Securities Secured Financing Corporation| N/A | 100 | 100 |
| | Prudential Securities Structured Assets, Inc. | N/A | 99 | 100 |
| | P-B Finance Ltd. | N/A | 3 | 100 |
| | R & D Funding Corp. | N/A | 100 | 100 |
| | Special Situations Management Inc. | N/A | 1,000 | 100 |
| | Seaport Futures Management, Inc. | N/A | 1,000 | 100 |
| | Wexford Clearing Services Corporation | N/A | 100 | 100 |
| | Prudential Dental Maintenance Organization, Inc. | N/A | 50 | 100 |
| | Prudential Direct, Inc. | N/A | 150 | 100 |
| | Prudential Equity Investors, Inc. | N/A | 1,000 | 100 |
| | Prudential Funding Corporation | N/A | 100 | 100 |
| | Prudential Health Care Plan, Inc. | N/A | 99 | 100 |
| | Prudential Health Care Plan of California, Inc. | N/A | 1,000 | 100 |
| | Prudential Health Care Plan of Connecticut, Inc. | N/A | 1,000 | 100 |
| | Prudential Health Care Plan of Georgia, Inc. | N/A | 1,000 | 100 |
| | Prudential Health Care Plan of New York, Inc. | N/A | 200 | 100 |
| | Prudential Institutional Fund Management, Inc. | N/A | 100 | 100 |
| | Prudential Holdings, Inc. | N/A | 1,000 | 100 |
| | Prudential Property and Casualty Insurance Company | N/A | 800 | 100 |
| | Prudential Commercial Insurance Company | N/A | 2,000 | 100 |
| | Prudential General Insurance Company | N/A | 2,000 | 100 |
| | Prudential Insurance Brokerage, Inc. | N/A | 25,000 | 100 |
| | The Prudential Property and Casualty General | | | |
| | Agency, Inc. | N/A | 100 | 100 |
| | The Prudential Property and Casualty Insurance Company | | | |
| | of New Jersey | N/A | 400 | 100 |
| | Prudential Realty Partnerships, Inc. | N/A | 100 | 100 |
| | Prudential Realty Securities, Inc. | N/A | 95 | 100 |
| | Prudential Realty Securities II, Inc. | N/A | 17 | 13 |
| | Prudential Retirement Services, Inc. | N/A | 100 | 100 |
| | PruServicos Participacoes, S.A. | N/A | 1 |less than 1 |
| | Prudential Trust Company | N/A | 300,000 | 100 |
| | PTC Services, Inc. | N/A | 100 | 100 |
| | Prudential Uniformed Services Administrators, Inc. | N/A | 500,000 | 100 |
| | The Prudential Bank and Trust Company | N/A | 203,996 | 100 |
| | PBT Mortgage Corporation | N/A | 2,250 | 100 |
| | The Prudential Savings Bank, F.S.B. | 4,134,889 | 10,000 | 100 |
| | PBT Home Equity Holdings | N/A | 4,000 | 100 |
| | Pruco Life Insurance Company of New Jersey | N/A | 400,000 | 100 |
| | The Prudential Life Insurance Company of Arizona | N/A | 200,000 | 100 |
- ----------------------------------------------------------------------------------------------------------------------

(a) Prudential Residential Services, L.P. is a partnership which is reported on Schedule BA.

Groups of companies which are indented are owned by the company listed
immediately above that group in the percentages indicated.

</TABLE>
C-6
<PAGE>

<TABLE>

Form 1
ANNUAL STATEMENT FOR THE YEAR 1995 OF THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

SCHEDULE D -- PART 6 -- SECTION 2
<CAPTION>

<S> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
| | | |
| | | |
| | 1 | 2 |
| | | |
| CUSIP | | Name of Company Listed in |
|Identi- | Name of Lower-tier Company | Section 1 Which Controls Lower-tier |
|fication| | Company |
| | | |
|--------|--------------------------------------------------------|-----------------------------------------------------|
| | OTIP/RAEO Insurance Company, Inc. | Prudential of America General Ins. Company (Canada) |
| | Prudential-Bache Capital Funding (Swaps) Limited | Prudential Global Funding, Inc. |
| | Prudential Texas Residential Services Corporation | Prudential Homes Corporation |
| | Prudential Select Life Insurance Company of America | Prudential Select Holdings, Inc. |
| | Lender's Service, Inc. | Residential Services Corporation of America |
| | Lender's Service Title Agency, Inc. | Residential Services Corporation of America |
| | Private Label Mortgage Services Corporation | Residential Services Corporation of America |
| | Residential Information Services, Inc. | Residential Services Corporation of America |
| | Securitized Asset Sales, Inc. | Residential Services Corporation of America |
| | Securitized Asset Services Corporation | Residential Services Corporation of America |
| | The Prudential Home Mortgage Company, Inc. | Residential Services Corporation of America |
| | The Prudential Home Mortgage Securities Company, Inc.| Residential Services Corporation of America |
| | Gateway Holdings, S.A. | The Prudential Investment Corporation |
| | Amicus Investment Company | The Prudential Investment Corporation |
| | Global Income Fund Management Company, S.A. | The Prudential Investment Corporation |
| | Global Series Fund II Management Company, S.A. | The Prudential Investment Corporation |
| | Jennison Long Bond Management Company | The Prudential Investment Corporation |
| | PAEC Management Company | The Prudential Investment Corporation |
| | Prudential Asset Sales and Syndications, Inc. | The Prudential Investment Corporation |
| | Prudential Home Building Investors, Inc. | The Prudential Investment Corporation |
| | PruSupply, Inc. | The Prudential Investment Corporation |
| | PruSupply Capital Assets, Inc. | The Prudential Investment Corporation |
| | The Prudential Asset Management Company, Inc. | The Prudential Investment Corporation |
| | Enhanced Investment Technologies, Inc. | The Prudential Investment Corporation |
| | PCM International, Inc. | The Prudential Investment Corporation |
| | Prudential Asia Investments Limited | The Prudential Investment Corporation |
| | Prudential Asia DBS Limited | The Prudential Investment Corporation |
| | Prudential Asia Fund Management Limited (BVI) | The Prudential Investment Corporation |
| | Prudential Asia Fund Management Limited | The Prudential Investment Corporation |
| | Prudential Asia Fund Managers (HK) Limited | The Prudential Investment Corporation |
| | Prudential Asset Management Asia Limited (BVI) | The Prudential Investment Corporation |
| | PAMA (Indonesia) Limited | The Prudential Investment Corporation |
| | PAMA (Singapore) Private Limited | The Prudential Investment Corporation |
| | Prudential Asset Management Asia Hong Kong Ltd. | The Prudential Investment Corporation |
| | PT PAMA Indonesia | The Prudential Investment Corporation |
| | SJ Bedding B.V. | The Prudential Investment Corporation |
| | Simmons Bedding & Furniture (HK) Limited | The Prudential Investment Corporation |
| | Simmons Asia Limited | The Prudential Investment Corporation |
| | Simmons (Southeast Asia) Private Limited | The Prudential Investment Corporation |
| | Simmons Co. Limited | The Prudential Investment Corporation |
| | Prudential Asset Management Company Securities Corp. | The Prudential Investment Corporation |
| | Prudential Timber Investments, Inc. | The Prudential Investment Corporation |
| | Texas Rio Grande Other Asset Group Company, Inc. | The Prudential Investment Corporation |
| | The Prudential Investment Advisory Company, Ltd. | The Prudential Investment Corporation |
| | The Prudential Property Company, Inc. | The Prudential Investment Corporation |
| | The Prudential Realty Advisors, Inc. | The Prudential Investment Corporation |
| | The Prudential Real Estate Financial Services of | |
| | America, Inc. | The Prudential Real Estate Affiliates, Inc. |
| | The Prudential Real Estate Financial Services of | |
| | Long Island, Inc. | The Prudential Real Estate Affiliates, Inc. |
| | The Prudential Referral Services, Inc. | The Prudential Real Estate Affiliates, Inc. |
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| | | |
|-----------------------------------------------------------------------------------------------------------------------|
| 0299999 COMMON STOCKS |
|-----------------------------------------------------------------------------------------------------------------------|
| 0399999 TOTAL - PREFERRED AND COMMON STOCKS |
- -------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
| | | | Stock in Lower-tier |
| | | | Company Owned |
| | 1 | 3 | Indirectly by Insurer |
| | | | on Statement Date |
| CUSIP | | Amount of Intangible |-------------------------|
|Identi- | Name of Lower-tier Company | Assets Included in | 4 | 5 |
|fication| | Amount Shown in | No. of | % of |
| | | Column 5, Section 1 | Shares |Outstanding |
|--------|--------------------------------------------------------|------------------------|------------|------------|
| | OTIP/RAEO Insurance Company, Inc. | N/A | 10,000 | 100 |
| | Prudential-Bache Capital Funding (Swaps) Limited | N/A | 1 | 100 |
| | Prudential Texas Residential Services Corporation | N/A | 1,000 | 100 |
| | Prudential Select Life Insurance Company of America | 1,262,549 | 2,500,000 | 100 |
| | Lender's Service, Inc. | 489,000 | 1,000 | 100 |
| | Lender's Service Title Agency, Inc. | N/A | 1,000 | 100 |
| | Private Label Mortgage Services Corporation | N/A | 1,000 | 100 |
| | Residential Information Services, Inc. | N/A | 1,000 | 100 |
| | Securitized Asset Sales, Inc. | N/A | 1,000 | 100 |
| | Securitized Asset Services Corporation | N/A | 1,000 | 100 |
| | The Prudential Home Mortgage Company, Inc. | N/A | 100 | 100 |
| | The Prudential Home Mortgage Securities Company, Inc.| N/A | 1,000 | 100 |
| | Gateway Holdings, S.A. | N/A | 20,000 | 100 |
| | Amicus Investment Company | N/A | 1,000 | 100 |
| | Global Income Fund Management Company, S.A. | N/A | 5,000 | 100 |
| | Global Series Fund II Management Company, S.A. | N/A | 1,400 | 100 |
| | Jennison Long Bond Management Company | N/A | 5,000 | 100 |
| | PAEC Management Company | N/A | 1,999 | 100 |
| | Prudential Asset Sales and Syndications, Inc. | N/A | 1,000 | 100 |
| | Prudential Home Building Investors, Inc. | N/A | 100 | 100 |
| | PruSupply, Inc. | N/A | 998 | 100 |
| | PruSupply Capital Assets, Inc. | N/A | 98 | 100 |
| | The Prudential Asset Management Company, Inc. | N/A | 86 | 100 |
| | Enhanced Investment Technologies, Inc. | N/A | 98 | 100 |
| | PCM International, Inc. | N/A | 100 | 100 |
| | Prudential Asia Investments Limited | N/A | 3,000,000 | 100 |
| | Prudential Asia DBS Limited | N/A | 475 | 25 |
| | Prudential Asia Fund Management Limited (BVI) | N/A | 200,000 | 100 |
| | Prudential Asia Fund Management Limited | N/A | 180 | 100 |
| | Prudential Asia Fund Managers (HK) Limited | N/A | 20 | 100 |
| | Prudential Asset Management Asia Limited (BVI) | N/A | 1,000,000 | 100 |
| | PAMA (Indonesia) Limited | N/A | 7,500 | 75 |
| | PAMA (Singapore) Private Limited | N/A | 1,000,000 | 100 |
| | Prudential Asset Management Asia Hong Kong Ltd. | N/A | 100 | 100 |
| | PT PAMA Indonesia | N/A | 650 | 65 |
| | SJ Bedding B.V. | N/A | 40 | 100 |
| | Simmons Bedding & Furniture (HK) Limited | N/A | 160,033 | 80 |
| | Simmons Asia Limited | N/A | 100,000 | 90 |
| | Simmons (Southeast Asia) Private Limited | N/A | 300,000 | 100 |
| | Simmons Co. Limited | N/A | 3,433,000 | 66 |
| | Prudential Asset Management Company Securities Corp. | N/A | 100 | 100 |
| | Prudential Timber Investments, Inc. | N/A | 100 | 100 |
| | Texas Rio Grande Other Asset Group Company, Inc. | N/A | 100 | 100 |
| | The Prudential Investment Advisory Company, Ltd. | N/A | 40,000 | 100 |
| | The Prudential Property Company, Inc. | N/A | 99 | 100 |
| | The Prudential Realty Advisors, Inc. | N/A | 100 | 100 |
| | The Prudential Real Estate Financial Services of | | | |
| | America, Inc. | N/A | 100 | 100 |
| | The Prudential Real Estate Financial Services of | | | |
| | Long Island, Inc. | N/A | 100 | 100 |
| | The Prudential Referral Services, Inc. | N/A | 1,000 | 100 |
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| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
|------------------------------------------------------------------------------------------|------------|------------|
| 0299999 COMMON STOCKS 15,282,022 | X X X | X X X |
|------------------------------------------------------------------------------------------|------------|------------|
| 0399999 TOTAL - PREFERRED AND COMMON STOCKS 15,282,022 | X X X | X X X |
- ----------------------------------------------------------------------------------------------------------------------

(a) Prudential Residential Services, L.P. is a partnership which is reported on Schedule BA.

Groups of companies which are indented are owned by the company listed
immediately above that group in the percentages indicated.

</TABLE>
C-7
<PAGE>

ITEM 26. NUMBER OF HOLDERS OF SECURITIES

TITLE OF CLASS NUMBER OF RECORD HOLDERS
- -------------- ------------------------

Money Market Portfolio
Capital Stock 14

Diversified Bond Portfolio
Capital Stock 15

High Yield Bond Portfolio
Capital Stock 14

Government Income Portfolio
Capital Stock 13

Equity Portfolio
Capital Stock 15

Stock Index Portfolio
Capital Stock 15

Equity Income Portfolio
Capital Stock 14

Natural Resources Portfolio
Capital Stock 13

Global Portfolio
Capital Stock 16

Conservative Balanced Portfolio
Capital Stock 15

Flexible Managed Portfolio
Capital Stock 15

Zero Coupon Bond 2000 Portfolio
Capital Stock 5

Zero Coupon Bond 2005 Portfolio
Capital Stock 5

Small Capitalization Stock Portfolio
Capital Stock 13

Prudential Jennison Portfolio 14
Capital Stock

C-8

<PAGE>

ITEM 27. INDEMNIFICATION

Article VI, paragraph (4) of Registrant's Articles of Incorporation provides
that "(e)ach director and each officer of the Corporation shall be indemnified
by the Corporation to the full extent permitted by the General Laws of the State
of Maryland and as provided in the by-laws of the Corporation." Article VIII of
the Registrant's Articles of Incorporation provides, in pertinent part, that
"(n)o provision of these Articles of Incorporation shall be effective to (a)
require a waiver of compliance with any provision of the Securities Act of 1933,
as amended, or the Investment Company Act of 1940, as amended, or of any valid
rule, regulation or order of the Securities and Exchange Commission thereunder
or (b) protect or purport to protect any director or officer of the Corporation
against any liability to the Corporation or its security holders to which he
would otherwise by subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office."

Paragraph 6 of both the Investment Advisory Agreement and the Supplemental
Investment Advisory Agreement between Registrant and Prudential provides that
"Prudential will not be liable for any error of judgment or mistake of law or
for any loss suffered by the Fund in connection with the matters to which this
Agreement relates, except for a loss resulting from willful misfeasance, bad
faith, or gross negligence in the performance of its duties on behalf of the
Fund or from reckless disregard of its obligation and duties under this
Agreement."

The Prudential Directors' and Officers' Liability and Corporation Reimbursement
Insurance program, purchased by Prudential from Aetna Casualty & Surety Company,
CNA Insurance Companies, Lloyds of London, Great American Insurance Company,
Reliance Insurance Company, Corporate Officers & Directors Assurance Ltd.,
A.C.E. Insurance Company, Ltd., XL Insurance Company, Ltd., and Zurich-American
Insurance Company, provides reimbursement for "Loss" (as defined in the
policies) which the Company pays as indemnification to its directors or officers
resulting from any claim for any actual or alleged act, error, misstatement,
misleading statement, omission, or breach of duty by persons in the discharge of
their duties in their capacities as directors or officers of Prudential, any of
its subsidiaries, or certain investment companies affiliated with Prudential.
Coverage is also provided to the individual directors or officers for such Loss,
for which they shall not be indemnified. Loss essentially is the legal liability
on claims against a director or officer, including adjudicated damages,
settlements and reasonable and necessary legal fees and expenses incurred in
defense of adjudicatory proceedings and appeals therefrom. Loss does not include
punitive or exemplary damages or the multiplied portion of any multiplied damage
award, criminal or civil fines or penalties imposed by law, taxes or wages, or
matters which are uninsurable under the law pursuant to which the policies are
construed.

There are a number of exclusions from coverage. Among the matters excluded are
Losses arising as the result of (1) claims brought about or contributed to by
the criminal, dishonest or fraudulent acts or omissions or the willful violation
of any law by a director or officer, (2) claims based on or attributable to
directors or officers gaining personal profit or advantage to which they were
not legally entitled, and (3) claims arising from actual or alleged performance
of, or failure to perform, services as, or in any capacity similar to, an
investment adviser, investment banker, underwriter, broker or dealer, as those
terms are defined in the Securities Act of 1933, the Securities Exchange Act of
1934, the Investment Advisers Act of 1940, the Investment Company Act of 1940,
any rules or regulations thereunder, or any similar federal, state or local
statute, rule or regulation.

The limit of coverage under the Program for both individual and corporate
reimbursement coverage is $150,000,000. The retention for corporate
reimbursement coverage is $10,000,000 per loss.

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

C-9
<PAGE>

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

Prudential does not have other business of a substantial nature besides
activities relating to the assets of the registrant. Prudential is involved in
insurance, reinsurance, securities, pension services, real estate and banking.

Prudential Investment Corporation (PIC) is the investment unit of Prudential and
actively engages in the business of giving investment advice. The officers and
directors of Prudential and PIC who are engaged directly or indirectly in
activities relating to the registrant have no other business, profession,
vocation, or employment of a substantial nature, and have not had such other
connections during the past two years.

The business and other connections of Prudential's Directors are listed in the
statement of additional information in Post-Effective Amendment No. 28 to the
Registration Statement of The Prudential Variable Contract Account-10,
Registration No. 2-76580, filed on or about February 27, 1997, the text of which
is hereby incorporated by reference.

ITEM 29. PRINCIPAL UNDERWRITERS

(a) Pruco Securities Corporation also acts as principal underwriter of
Prudential's Gibraltar Fund.

(b) NAME AND PRINCIPAL POSITIONS AND OFFICES
BUSINESS ADDRESS WITH UNDERWRITER
---------------- ----------------

James Avery Jr. ** Director
E. Michael Caulfield * Director
Joseph Mahoney ** Director
Richard O. Painter *** Director
Richard A. Topp * Director and President
William F. Yelverton * Chairman of the Board
C. Edward Chaplin * Treasurer
Kevin Frawley ** Vice President and Chief Compliance Officer
Clifford E. Kirsch ** Chief Legal Officer and Secretary
Lisa Ramaswamy *** Comptroller and Chief Financial Officer

* Principal Business Address: Prudential Plaza, Newark, NJ 07102
** Principal Business Address: 213 Washington Street, Newark, NJ 07102
*** Principal Business Address: 1111 Durham Avenue, South Plainfield, NJ 07080

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

All accounts, books, or other documents required to be maintained by Section 31
(a) of the 1940 Act and the rules promulgated thereunder are maintained by the
Registrant, Prudential Plaza, Newark, New Jersey 07102-3777; the Registrant's
Investment Advisor, The Prudential Insurance Company of America, Prudential
Plaza, Newark, New Jersey 07102-3777 or the Registrant's Custodians, Chase
Manhattan Bank, Chase Metro Tech Center, Brooklyn, NY 11245, and Brown Brothers
Harriman & Co., 40 Water Street, Boston, MA 02109.

ITEM 31. MANAGEMENT SERVICES

Not Applicable.

ITEM 32. UNDERTAKINGS

(c) The undersigned Registrant hereby undertakes to furnish each person to whom
a prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders upon request and without charge.

C-10
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Newark, State of New Jersey, on the 27th day of February, 1997.

THE PRUDENTIAL SERIES FUND, INC.

By: /s/ Mendel A. Melzer
--------------------------
Mendel A. Melzer
Chairman of the Board

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment No. 32 to the Registration Statement has been signed below by the
following persons in the capacities and on the date indicated.

SIGNATURE AND TITLE DATE
- ------------------- ----
<S> <C> <C>
/s/ * February 27, 1997
- -------------------------------------
E. Michael Caulfield
President and Director

/s/ * February 27, 1997
- -------------------------------------
Mendel A. Melzer
Chairman of the Board of Directors and
Principal Executive Officer

/s/ * February 27, 1997
- -------------------------------------
Eugene Stark
Comptroller and Principal Financial
Officer

/s/ * February 27, 1997 *By:/s/ Thomas C. Castano
- ------------------------------------- -----------------------
Saul K. Fenster Thomas C. Castano
Director (Attorney-in-Fact)

/s/ * February 27, 1997
- -------------------------------------
W. Scott McDonald, Jr.
Director

/s/ * February 27, 1997
- -------------------------------------
Joseph Weber
Director

</TABLE>

C-11
<PAGE>

EXHIBIT INDEX

(viii)(1)(a) Addendum #2 to Custodian Contract Between the Chase Page C-13
Manhattan Bank and The Prudential Series Fund, Inc.

(xvii)(b) Power of Attorney: Mr. Stark. Page C-20

C-12

EXHIBIT (viii)(1)(a)

ADDENDUM #2 TO CUSTODIAN CONTRACT BETWEEN
THE CHASE MANHATTAN BANK
AND
THE PRUDENTIAL SERIES FUND

This Addendum #2 to the Custodian Contract is by and between The Prudential
Series Fund, Inc. (the "Fund") and The Chase Manhattan Bank, formerly known as
Chemical Bank, formerly known as Manufacturers Hanover Trust Company (the
"Custodian"),

WHEREAS, the Fund is authorized to issue shares of capital stock ("Shares") in
separate classes, with each such class representing interests in a separate
Portfolio of securities and other assets which are referred to herein as the
"Funds";

WHEREAS, the Custodian is the custodian for the Fund, except for the joint
repurchase account of the Fund, pursuant to an agreement entered into on June 1,
1986 by the Custodian's predecessor company and the Fund;

WHEREAS, the Fund previously obtained an Order permitting such Portfolios as may
be determined by the Fund to participate in a joint repurchase agreement
account; and

WHEREAS, the Fund has been participating in a joint repurchase agreement account
and desires to change the custodian for such account to Custodian;

WITNESSETH: That in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:

1. AMENDMENTS.

(a) The first paragraph of Section 1 is hereby amended to state:

"1. Employment of Custodian and Property to be Held by It
-----------------------------------------------------
The Fund hereby employs the Custodian as a custodian of its assets
pursuant to the provisions of the Fund's By-Laws. The Fund agrees to
deliver to the Custodian all securities and cash owned by it, and all
payments of income, payments of principal or capital distributions
received by it with respect to all securities owned by the Fund from
time to time, and the cash consideration received by it for such new
or treasury shares of capital stock, $0.01 par value, ("Shares") of
the Fund as may be issued or sold from time to time, and cash amounts
earmarked for repurchase agreements involving securities eligible for
the Federal Book Entry System entered into by the Fund and securities
related to such agreements. The CustodIan shall not be responsible
for any property of the Fund held or received by the Fund and not
delivered to the Custodian."

C-13

<PAGE>

(b) The following paragraph shall be added at the end of Section 2.1:

"All securities held by the Custodian in any account under this Agreement
which have been redeposited in a book-entry system authorized by the U.S.
Department of the Treasury should be separately identified on the
Custodian's official records from securities of other accounts
established under this Agreement, and from securities of any other
accounts held by the Custodian for the Fund under other custody
agreements."

"14) For delivery to any other custodian of the Fund."

(d) Section 2.4 is hereby amended to state:

"2.4 Bank Accounts. The Custodian shall open and maintain a separate bank
account in the name of each of the Funds, or in the case of joint
repurchases, a bank account and/or accounts in the name of the Fund,
subject only to draft or order by the Custodian or the Fund acting
pursuant to the terms of this Contract, and shall hold in such account or
accounts, subject to the provisions hereof, all cash received by it from
or for the account of each of the Funds, or in the case of joint
repurchases, from or for the account of the Fund, other than cash
maintained by the Fund(s) in a bank account established and used in
accordance with Rule 17f-3 under the Investment Company Act of 1940.
Funds held by the Custodian for the Fund may be deposited in the Banking
Department of the Custodian or in such other banks or trust companies as
it may in its discretion deem necessary or desirable; provided, however,
that every such bank or trust company shall be qualified to act as a
custodian under the Investment Company Act of 1940 and that each such
bank or trust company and the funds to be deposited with each such bank
or trust company shall be approved by vote of a majority of the Board of
Directors of the Fund. Such funds shall be deposited by the Custodian in
this capacity as Custodian and shall be withdrawable by the Custodian
only in that capacity."

C-14

<PAGE>

(e) The following paragraph shall be added as a second paragraph to
Section 2.6:

"In the case of the joint repurchase account, interest on securities held
by the Custodian under this Agreement either in a Securities System
account of the Custodian or in the name of the Custodian's nominee, will
be credited automatically to the designated account of the Fund when such
funds become due and payable, whether or not collected by the Custodian.
Amounts due on securities which mature or are redeemed will be credited
to the designated account of the Fund on the actual settlement date,
provided the securities are held by the Custodian and our delivery
instructions are received by the Custodian in a timely fashion. If the
amount of a matured or redeemed security is not credited to the
designated account of the Fund on the date on which such security matured
or was redeemable solely because of the error of the Custodian, the
Custodian will credit such account with such amount as of the date on
which such security matured or was redeemable. To the extent the
Custodian does not receive payment on any funds credited as herein before
provided to the designated account, Custodian shall be entitled to debit
the uncollected funds credited to such account as of the date such funds
were credited to the account."

(f) The following paragraphs shall be amended in Section 2.7 to state:

"2.7 Payment of Fund Moneys. Upon receipt of instructions, which may be
continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out moneys for the Fund (from available funds in the
Fund Bank Account in the case of joint repurchase transactions) in the
following cases only:

1) Upon the purchase of securities for the account of each of the Funds,
and in the case of joint repurchases, for the account of the Fund, but
only (a) against the delivery of such securities to the Custodian (or any
bank, banking firm or trust company doing business in the United States
or abroad which is qualified under the Investment Company Act of 1940, as
amended, to act as a custodian and has been designated by the Custodian
as its agent for this purpose) registered in the name of the appropriate
Fund or in the name of a nominee of the Custodian referred to in Section
2.3 hereof or in proper form for transfer; (b) in the case of a purchase
effected through a Securities System, in accordance with the conditions
set forth in Section 2.10 hereof or in the case of repurchase

C-15

<PAGE>

agreements entered into between the Fund and the Custodian, or another
bank, or a broker or dealer, (i) against delivery of the securities
either in certificate form or through an entry crediting the Custodian's
account at the Federal Reserve Bank with such securities or (ii) against
delivery of the receipt evidencing purchase by the Fund of securities
owned by the Custodian along with written evidence of the agreement by
the Custodian to repurchase such securities from the Fund;"

(g) The following paragraph shall be added at the end of Section 2.7:

"7) To any other custodian of the Fund"

(h) The following paragraphs shall be amended in Section 2.10 to cstate:

"2) The records of the Custodian with respect to securities for the Fund
which are maintained in a Securities System shall identify by book-entry
those securities belonging to each of the Funds, or in the case of joint
repurchases, those securities belonging to the Fund;"

3) The Custodian shall pay for the securities purchased for each account
of the Fund, or in the case of joint repurchases, securities purchased
for the account of the Fund, upon (i) receipt of advice from the
Securities System that such securities have been transferred to the
Account, and (ii) the making of an entry on the records of the Custodian
to reflect such payment and transfer for the proper account of the Fund.
The Custodian shall transfer securities sold for each account of the Fund
upon (i) receipt of advice from the Securities System that payment for
such securities has been transferred to the Account, and (ii) the making
of an entry on the records of the Custodian to reflect such transfer and
payment for the proper account of the Fund. Copies of all advices from
the Securities System of transfers of securities for the accounts of the
Fund shall identify the Fund, be maintained for the Fund by the Custodian
and be provided to the Fund at its request. Upon request, the Custodian
shall furnish the Fund confirmation of each transfer to or from the
proper account of the Fund in the form of a written advice or notice and
shall furnish to the Fund copies of daily transaction sheets reflecting
each day's transactions in the Securities System for the accounts of the
Fund, or in the case of joint repurchases, the account of the Fund, on
the next business day;"

C-16

<PAGE>

(i) Paragraph 1 of Section 7 shall be amended to state:

"The Custodian will be strictly liable for all losses due to burglary,
robbery, theft, fire and mysterious disappearances, regardless of whether
such a loss occurs while the assets are on deposit with the Custodian, or
any nominee of the Custodian, or the Federal Reserve Bank of New York in
connection with book-entry procedures as provided in Treasury Department
regulations in effect from time to time, or a domestic securities
depository (hereinafter "depository") registered with the Securities and
Exchange Commission (the "SEC") under Section 17A of the Securities and
Exchange Act of 1934 ("1934 Act"), and any successor thereto, or any
other agent of the Custodian at the time of the loss. Anything in this
Agreement to the contrary notwithstanding, in no event shall the
Custodian be liable to the Fund under this Agreement for special,
indirect or consequential loss or damage of any kind whatsoever, whether
or not the Custodian is advised as to the possibility of such loss or
damage and regardless of the form of action any such loss or damage may
be claimed."

(j) Paragraph 2 of Section 7 shall be amended to state:

"For losses resulting from other causes the Custodian will be liable
unless the Custodian can prove that it and any of its agents or nominees,
the Federal Reserve Bank of New York in connection with book-entry
procedures, as provided in Treasury Department regulations in effect from
time to time, and any domestic securities depository registered with the
SEC under Section 17A of the 1934 Act, and any successor thereto, were
not negligent and did not act with willful misconduct. The Custodian may
apply for and obtain the advice and opinion of counsel to the Fund with
respect to questions of law and shall be fully protected with respect to
anything done or omitted by it in good faith in conformity with such
advise or opinion. Except as provided in the preceding paragraph, in the
performance of its duties hereunder, the Custodian shall exercise the
standard of care which a professional custodian engaged in the banking or
trust company industry and having professional expertise in financial and
securities processing transactions and custody would observe in these
affairs."

(k) Paragraph 3 of Section 7 shall be amended to state:

C-17

<PAGE>

"In the event of loss, damage or injury to the securities or cash while
on deposit with the Custodian, its agents or any nominee of the
Custodian, including the Federal Reserve Bank of New York in connection
with book-entry procedures, or any domestic securities depository
registered with the SEC under the 1934 Act, and any successor thereto, or
any other agent of the Custodian, the Custodian, at its option, shall
promptly cause such securities or cash to be replaced by other securities
or cash as the case may be, of like kind and quality, by among other
means posting appropriate security or bond, at Custodians own expense,
with the issuer(s) of such securities and obtaining their reissue,
together with all rights and privileges resulting from such loss,
including without limitation the value of any dividends, interest or
other distributions not received as a result of the loss of such
securities together with interest at the Federal Funds rate from the time
of such distribution until payment is made to the Fund (the "Lost
Benefits")."

(l) Paragraph 4 of Section 7 shall be amended to state:

"In the event the Custodian is unable to replace the securities in the
Fund's account(s), the Custodian shall remit to the Fund cash equal to
fair market value of the securities as of the date of the discovery of
the loss, together with any Lost Benefits. The Custodian may at its
option insure itself against loss from any cause but shall be under no
obligation to insure for the benefit of the Fund."

IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the ____ day of December, 1996.

SEAL

ATTEST THE PRUDENTIAL SERIES FUND INC.

__________________________ By:____________________________

Title:_________________________

C-18

<PAGE>

SEAL

ATTEST
THE CHASE MANHATTAN BANK

__________________________ By:____________________________

Title:_________________________

C-19

Exhibit (xvii)(a)

POWER OF ATTORNEY

Know all men by these presents:

That I, EUGENE STARK , of
-------------------------------------------------------------------
NEWARK, NEW JERSEY ,
- ------------------------------------------------------------------------------

an officer of The Prudential Series Fund, Inc., do hereby make, constitute and
appoint as my true and lawful attorneys in fact THOMAS C. CASTANO, THOMAS EARLY
and CLIFFORD E. KIRSCH, or any of them severally for me and in my name, place
and stead to sign registration statements and any and all amendments thereto
executed in behalf of The Prudential Series Fund, Inc., and filed with the
Securities and Exchange Commission, as follows:

Registration Statement on Form N-1A for the registration under the
Securities Act of 1933 and the Investment Company Act of 1940 of The
Prudential Series Fund, Inc.

IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of February,
1997.

/s/ Eugene Stark
----------------------------------
Signature

State of NJ )
SS:
County of Union )

On this 24 day of February, 1997, before me personally appeared Eugene
Stark, to me known and known to me to be the person mentioned and described in
and who executed the foregoing instruments and he duly acknowledged to me that
he executed the same.

/s/ Carmen J. Bailey
-----------------------------
Notary Public

My commission expires: 10/15/97

C-20