MANUFACTURERS LIFE INSURANCE CO OF NORTH AMERICA SEP ACC A, 485APOS, 1998-02-26

MANUFACTURERS LIFE INSURANCE CO OF NORTH AMERICA SEP ACC A
485APOS, 1998-02-26

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<PAGE> 1

As filed with the Securities and Exchange Commission on February 26, 1998.

Registration No. 333-24657

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 1

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA SEPARATE ACCOUNT A
(formerly NASL Variable Account)
(Exact name of Registrant)

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
(formerly North American Security Life Insurance Company)
(Name of Depositor)

116 Huntington Avenue
Boston, Massachusetts 02116
(Address of Depositor's Principal Executive Offices)

(617) 266-6004
(Depositor's Telephone Number Including Area Code)

James D. Gallagher, Esq.
Vice President, Secretary
and General Counsel
The Manufacturers Life Insurance Company of North America
73 Tremont Street
Boston, Massachusetts 02108
(Name and Address of Agent for Service)

Copy to:
J. Sumner Jones, Esq.
Jones & Blouch, L.L.P.
1025 Thomas Jefferson Street, N.W.
Washington, DC 20007

It is proposed that this filing will become effective:
---

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

on (date), pursuant to paragraph (b) of Rule 485
---

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

X on May 1, 1998 pursuant to paragraph (a)(1) of Rule 485
---

<PAGE> 2

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA SEPARATE ACCOUNT A

CROSS REFERENCE TO ITEMS REQUIRED BY FORM N-4

<TABLE>
<CAPTION>
N-4 Item Caption in Prospectus
Part A
<S> <C>
1............... Cover Page
2............... Special Terms
3............... Summary
4............... Performance Data; Financial Statements
5............... General Information about The Manufacturers Life Insurance Company of North America, The
Manufacturers Life Insurance Company of North America Separate Account A and Manufacturers
Investment Trust
6............... Charges and Deductions; Withdrawal Charge; Reduction or Elimination of Withdrawal Charge;
Administration Fees; Distribution Fee; Mortality and Expense Risk Charge; Taxes; Appendix A;
Appendix B
7............... Accumulation Provisions; Company Approval; Purchase Payments; Accumulation Units; Net
Investment Factor; Transfers Among Investment Options; Telephone Transactions; Special
Transfer Services - Dollar Cost Averaging; Asset Rebalancing Program; Withdrawals; Special
Withdrawal Services - the Income Plan; Contract Owner Inquiries; Other Contract Provisions;
Ownership; Beneficiary; Modification
8............... Annuity Provisions; General; Annuity Options; Determination of Amount of the First Variable
Annuity Payment; Annuity Units and the Determination of Subsequent Variable Annuity Payments;
Transfers After Maturity Date
9............... Accumulation Provisions; Death Benefit Before Maturity Date; Annuity Provisions; Death Benefit
on or After Maturity Date
10.............. Accumulation Provisions; Purchase Payments; Accumulation
Units; Value of Accumulation Units; Net Investment Factor;
Distribution of Contracts
11.............. Withdrawals; Restrictions under the Texas Optional Retirement
Program; Accumulation Provisions; Purchase Payments; Other
Contract Provisions; Ten Day Right to Review
12.............. Federal Tax Matters; Introduction; The Company's Tax Status;
Taxation of Annuities in General; Diversification
Requirements; Qualified Retirement Plans
13.............. Legal Proceedings
14.............. Statement of Additional Information - Table of Contents

</TABLE>

<PAGE> 3

<TABLE>
<S> <C>
Part B............Caption in Statement of Additional Information
15................Cover Page
16................Table of Contents
17................General History and Information.
18................Services-Accountants, Services-Servicing Agent
19................Not Applicable
20................Services - Principal Underwriter
21................Performance Data
22................Not Applicable
23................Financial Statements
</TABLE>

<PAGE> 4
PART A

INFORMATION REQUIRED IN A PROSPECTUS
<PAGE> 5

Annuity Service Office Mailing Address
116 Huntington Avenue Post Office Box 9230
Boston, Massachusetts 02116 Boston, Massachusetts
(617) 266-6004 02205-9230
(800) 344-1029

THE MANUFACTURERS
LIFE INSURANCE COMPANY OF NORTH AMERICA
SEPARATE ACCOUNT A

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA

FLEXIBLE PURCHASE PAYMENT INDIVIDUAL DEFERRED
COMBINATION FIXED AND VARIABLE ANNUITY CONTRACT
NON-PARTICIPATING

This Prospectus describes a flexible purchase payment individual
deferred fixed and variable annuity contract (the "contract") issued by The
Manufacturers Life Insurance Company of North America, formerly North American
Security Life Insurance Company (the "Company"), a stock life insurance company
the ultimate parent of which is The Manufacturers Life Insurance Company
("Manulife"). The contract is designed for use in connection with retirement
plans which may or may not qualify for special Federal income tax treatment.

The contract provides for the accumulation of contract values and the
payment of annuity benefits on a variable and/or fixed basis. The contract
offers thirty-seven investment options: thirty-five variable and two fixed
accounts. The contract value during the accumulation period and annuity
payments, if selected on a variable basis, will vary according to the investment
performance of the sub-accounts of The Manufacturers Life Insurance Company of
North America Separate Account A, formerly NASL Variable Account (the "Variable
Account"). The Variable Account is a separate account established by the
Company. Purchase payments and earnings on those purchase payments may be
allocated to and transferred among one or more of thirty-five sub-accounts of
the Variable Account. The assets of each sub-account are invested in shares of
Manufacturers Investment Trust, formerly NASL Series Trust (the "Trust"), a
mutual fund having an investment portfolio for each sub-account of the Variable
Account (see the accompanying Prospectus of the Trust). Fixed contract values
may be accumulated under the one year fixed account investment option or the one
year DCA fixed account investment option. Except as specifically noted herein
and as set forth under the caption "FIXED ACCOUNT INVESTMENT OPTION" below, this
Prospectus describes only the variable portion of the contract.

Shares of the Trust are not deposits or obligations of, or guaranteed
or endorsed by, any bank, and the shares are not federally insured by the
Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other
agency.

Additional information about the contract and the Variable Account is
contained in a Statement of Additional Information, dated the same date as this
Prospectus, which has been filed with the Securities and Exchange Commission
(the "SEC") and is incorporated herein by reference. The Statement of Additional
Information is available without charge upon request by writing the Company at
the above address or telephoning (800) 344-1029. In addition, the SEC maintains
a Web site (http://www.sec.gov) that contains the Statement of Additional
Information, material incorporated by reference, and other information regarding
registrants that file electronically with the SEC. The table of contents for the
Statement of Additional Information is included on page 42 of this Prospectus.

PLEASE READ THIS PROSPECTUS CAREFULLY AND KEEP IT FOR FUTURE REFERENCE. IT
CONTAINS INFORMATION ABOUT THE VARIABLE ACCOUNT AND THE VARIABLE PORTION OF THE
CONTRACT THAT A PROSPECTIVE PURCHASER SHOULD KNOW BEFORE INVESTING.

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

The date of this Prospectus is May 1, 1998

VTG20.PR0598

<PAGE> 6

TABLE OF CONTENTS

<TABLE>
<S> <C>
SPECIAL TERMS ................................................................................. 3
SUMMARY ....................................................................................... 5
GENERAL INFORMATION ABOUT THE
MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA, THE
MANUFACTURERS LIFE INSURANCE COMPANY OF
NORTH AMERICA SEPARATE ACCOUNT A AND
MANUFACTURERS
INVESTMENT TRUST............................................................................... 13
The Manufacturers Life Insurance Company of North America ............................... 13
The Manufacturers Life Insurance Company of North America Separate Account A ............ 13
Manufacturers Investment Trust ........................................................... 13
DESCRIPTION OF THE CONTRACT ................................................................... 18
ACCUMULATION PROVISIONS .................................................................... 18
Purchase Payments ........................................................................ 18
Payment Enhancements ..................................................................... 18
Accumulation Units ....................................................................... 19
Value of Accumulation Units .............................................................. 20
Net Investment Factor .................................................................... 20
Transfers Among Investment Options ....................................................... 21
Maximum Number of Investment Options ..................................................... 21
Telephone Transactions ................................................................... 21
Special Transfer Services - Dollar Cost Averaging ........................................ 21
Asset Rebalancing Program ................................................................ 22
Withdrawals .............................................................................. 22
Telephone Redemptions .................................................................... 23
Special Withdrawal Services -the Income Plan ............................................. 23
Loans .................................................................................... 23
Death Benefit Before Maturity Date ....................................................... 24
ANNUITY PROVISIONS ......................................................................... 25
General .................................................................................. 25
Annuity Options .......................................................................... 25
Determination of Amount of the First Variable
Annuity Payment .......................................................................... 26
Annuity Units and the Determination of
Subsequent Variable Annuity Payments .................................................. 27
Transfers After Maturity Date ............................................................ 27
Death Benefit on or After Maturity Date .................................................. 27
OTHER CONTRACT PROVISIONS .................................................................. 27
Ten Day Right to Review .................................................................. 27
Ownership ................................................................................ 28
Annuitant ................................................................................ 28
Beneficiary .............................................................................. 28
Modification ............................................................................. 29
Company Approval ......................................................................... 29
Misstatement and Proof of Age, Sex or Survival ........................................... 29
FIXED ACCOUNT INVESTMENT OPTION ............................................................... 29
CHARGES AND DEDUCTIONS ........................................................................ 31
Withdrawal Charges ....................................................................... 31
Reduction or Elimination of Withdrawal Charges ........................................... 32
Administration Fees ...................................................................... 33
Mortality and Expense Risk Charge ........................................................ 33
Taxes .................................................................................... 33
FEDERAL TAX MATTERS ........................................................................... 34
INTRODUCTION ............................................................................... 34
</TABLE>

<PAGE> 7

<TABLE>
<S> <C>
THE COMPANY'S TAX STATUS ................................................................... 34
TAXATION OF ANNUITIES IN GENERAL ........................................................... 34
Tax Deferral During Accumulation Period .................................................. 34
Taxation of Partial and Full Withdrawals ................................................. 36
Taxation of Annuity Payments ............................................................. 36
Taxation of Death Benefit Proceeds ....................................................... 37
Penalty Tax on Premature Distributions ................................................... 37
Aggregation of Contracts ................................................................. 37
QUALIFIED RETIREMENT PLANS .................................................................... 37
Qualified Plan Types ..................................................................... 38
Direct Rollovers ......................................................................... 40
FEDERAL INCOME TAX WITHHOLDING ............................................................. 40
GENERAL MATTERS ............................................................................... 41
Tax Deferral ............................................................................. 41
Performance Data ......................................................................... 41
Financial Statements ..................................................................... 41
Asset Allocation and Timing Services ..................................................... 41
Restrictions Under the Texas Optional
Retirement Program .................................................................. 41
Distribution of Contracts ................................................................ 42
Contract Owner Inquiries ................................................................. 42
Confirmation Statements .................................................................. 42
Legal Proceedings ........................................................................ 42
Other Information ........................................................................ 42
STATEMENT OF ADDITIONAL INFORMATION-
TABLE OF CONTENTS .......................................................................... 42
APPENDIX A: EXAMPLES OF CALCULATION OF
WITHDRAWAL CHARGE .......................................................................... 43
APPENDIX B: STATE PREMIUM TAXES .............................................................. 45
APPENDIX C: MAXIMUM MATURITY AGES
IN PENNSYLVANIA ............................................................................ 46
APPENDIX D: EXAMPLES OF PAYMENT
ENHANCEMENT CALCULATION .................................................................... 47
</TABLE>

2
<PAGE> 8
SPECIAL TERMS

The following terms as used in this Prospectus have the indicated
meanings:

Accumulation Unit - A unit of measure that is used to calculate the
value of the variable portion of the contract before the maturity date.

Annuitant - Any natural person or persons whose life is used to
determine the duration of annuity payments involving life contingencies. If the
contract owner names more than one person as an "annuitant," the second person
named shall be referred to as "co-annuitant." The "annuitant" and "co-annuitant"
will be referred to collectively as "annuitant." The "annuitant" is as
designated on the contract specification page or in the application, unless
changed.

Annuity Option - The method selected by the contract owner (or as
specified in the contract if no selection is made) for annuity payments made by
the Company.

Annuity Service Office - The service office of the Company is P.O. Box
9230, Boston, Massachusetts 02205-9230.

Annuity Unit - A unit of measure that is used after the maturity date
to calculate variable annuity payments.

Beneficiary - The person, persons or entity entitled to the death
benefit under the contract upon the death of a contract owner or, in certain
circumstances, an annuitant. The beneficiary is as specified in the application,
unless changed. If there is a surviving contract owner, that person will be
deemed the beneficiary.

Contingent Beneficiary - The person, persons or entity to become the
beneficiary if the beneficiary is not alive. The contingent beneficiary is as
specified in the application, unless changed.

Contract Anniversary - The anniversary of the contract date.

Contract Date - The date of issue of the contract.

Contract Value - The total of the investment account values and, if
applicable, any amount in the loan account attributable to the contract.

Contract Year - The period of twelve consecutive months beginning on
the contract date or any anniversary thereof.

Debt - Any amounts in the loan account attributable to the contract
plus any accrued loan interest. The loan provision is applicable to certain
qualified contracts only.

Due Proof of Death - Due Proof of Death is required upon the death of
the contract owner or annuitant, as applicable. One of the following must be
received at the Annuity Service Office within one year of the date of death:

(a) A certified copy of a death certificate;
(b) A certified copy of a decree of a court of competent jurisdiction
as to the finding of death; or
(c) Any other proof satisfactory to us.

Death Benefits will be paid within 7 days of receipt of due proof of death and
all required claim forms by the Company's Annuity Service Office.

Fixed Annuity - An annuity option with payments which are predetermined
and guaranteed as to dollar amount.

General Account - All the assets of the Company other than assets in
separate accounts.

Investment Account - An account established by the Company which
represents a contract owner's interest in an investment option prior to the
maturity date.

3
<PAGE> 9
Investment Account Value - The value of a contract owner's investment
in an investment account.

Investment Options - The investment choices available to contract
owners. Currently, there are thirty-five variable account investment options and
two fixed investment options under the contract.

Loan Account - The portion of the general account that is used for
collateral when a loan is taken.

Maturity Date - The date on which annuity benefits commence. The
maturity date is the date specified on the contract specifications page and is
generally the first day of the month following the later of the annuitant's 85th
birthday or the tenth contract anniversary, unless changed.

Net Purchase Payment - The purchase payment less the amount of premium
tax, if any, plus any applicable payment enhancement.

Non-Qualified Contracts - Contracts which are not issued under
qualified plans.

Owner or Contract Owner - The person, persons (co-owner) or entity
entitled to all of the ownership rights under the contract. The owner has the
legal right to make all changes in contractual designations where specifically
permitted by the contract. The owner is as specified in the application, unless
changed.

Payment Enhancement - The amount added to the contract by the Company
at the time a contract owner makes a purchase payment.

Portfolio or Trust Portfolio - A separate investment portfolio of the
Trust, a mutual fund in which the Variable Account invests, or of any successor
mutual fund.

Purchase Payment - An amount paid by a contract owner to the Company as
consideration for the benefits provided by the contract.

Qualified Contracts - Contracts issued under qualified plans.

Qualified Plans - Retirement plans which receive favorable tax
treatment under Section 401, 403, 408, 408A or 457 of the Internal Revenue Code
of 1986, as amended.

Separate Account - A segregated account of the Company that is not
commingled with the Company's general assets and obligations.

Sub-Account(s) - One or more of the sub-accounts of the Variable
Account. Each sub-account is invested in shares of a different Trust portfolio.

Valuation Date - Any date on which the New York Stock Exchange is open
for business and the net asset value of a Trust portfolio is determined.

Valuation Period - Any period from one valuation date to the next,
measured from the time on each such date that the net asset value of each
portfolio is determined.

Variable Account - The Variable Account, which is a separate account of
the Company.

Variable Annuity - An annuity option with payments which: (1) are not
predetermined or guaranteed as to dollar amount, and (2) vary in relation to the
investment experience of one or more specified sub-accounts.

4
<PAGE> 10
SUMMARY

The Contract. The contract offered by this Prospectus is a flexible
purchase payment individual deferred combination fixed and variable annuity
contract. The contract provides for the accumulation of contract values and the
payment of annuity benefits on a variable and/or fixed basis.

Retirement Plans. The contract may be issued pursuant to either
non-qualified retirement plans or plans qualifying for special income tax
treatment under the Internal Revenue Code of 1986, as amended (the "Code") such
as individual retirement accounts and annuities (including Roth IRAs), pension
and profit-sharing plans for corporations and sole proprietorships/partnerships
("H.R. 10" and "Keogh" plans), tax-sheltered annuities, and state and local
government deferred compensation plans (see "QUALIFIED RETIREMENT PLANS").

Purchase Payments. A contract may be issued upon the making of an
initial purchase payment of $10,000 or more. Minimum subsequent purchase
payments must be $30. Purchase payments may be made at any time, except that if
a purchase payment would cause the contract value to exceed $1,000,000, or the
contract value already exceeds $1,000,000, additional purchase payments will be
accepted only with the prior approval of the Company. The Company may, at its
option, cancel a contract at the end of any two consecutive contract years in
which no purchase payments have been made, if both (i) the total purchase
payments made over the life of the contract, less any withdrawals, are less than
$2,000; and (ii) the contract value at the end of such two year period is less
than $2,000. The cancellation of contract privileges may vary in certain states
in order to comply with the requirements of insurance laws and regulations in
such state (see "PURCHASE PAYMENTS").

Payment Enhancement. At the time a purchase payment is paid to the
Company by a contract owner, the Company will add a payment enhancement to the
owner's contract. The payment enhancement depends on the cumulative amount of
purchase payments. The next higher payment enhancement may be applied to the
initial payment. To receive the higher percentage the contract owner must
provide satisfactory evidence that the total payments within 13 months of the
issue date will be equal to or in excess of the next payment enhancement
cumulative purchase payment breakpoint. If total purchase payments received
within the 13 month period do not equal or exceed the amount approved, the
Company reserves the right to recover from the contract the excess payment
enhancement added to the contract. The payment enhancement is funded from the
Company's general account. The payment enhancement is allocated among investment
options in the same proportion as the applicable purchase payment. The amount
available as a death benefit is reduced by payment enhancements applied in the
prior 12 month period (see "DEATH BENEFIT BEFORE MATURITY DATE"). The amount
returned if the contract owner exercises his or her right to return the contract
during the "ten day right to review" period is reduced by any payment
enhancements applied (see "TEN DAY RIGHT TO REVIEW" and "PAYMENT ENHANCEMENT").

Investment Options. Purchase payments may be allocated among the
thirty-seven investment options currently available under the contract:
thirty-five variable account investment options and two fixed investment
options. Due to current administrative capabilities, a contract owner is limited
to a maximum of seventeen investment options (including the fixed account
investment option) during the period prior to the maturity date of the contract.
The thirty-five variable investment options are the thirty-five sub-accounts of
the Variable Account, a separate account established by the Company. The
sub-accounts invest in corresponding portfolios of the Trust: the Pacific Rim
Emerging Markets Trust, the Science & Technology Trust, the International Small
Cap Trust, the Emerging Growth Trust, the Pilgrim Baxter Growth Trust, the
Small/Mid Cap Trust, the International Stock Trust, the Worldwide Growth Trust,
the Global Equity Trust, the Small Company Value Trust, the Growth Trust, the
Equity Trust, the Quantitative Equity Trust, the Blue Chip Growth Trust, the
Real Estate Securities Trust, the Value Trust, the International Growth and
Income Trust, the Growth and Income Trust, the Equity-Income Trust, the Balanced
Trust, the Aggressive Asset Allocation Trust, the High Yield Trust, the Moderate
Asset Allocation Trust, the Conservative Asset Allocation Trust, the Strategic
Bond Trust, the Global Government Bond Trust, the Capital Growth Bond Trust, the
Investment Quality Bond Trust, the U.S. Government Securities Trust, the Money
Market Trust, the Lifestyle Aggressive 1000 Trust, the Lifestyle Growth 820
Trust, the Lifestyle Balanced 640 Trust, the Lifestyle Moderate 460 Trust and
the Lifestyle Conservative 280 Trust (see the accompanying Prospectus of the
Trust). The contract value during the accumulation period and monthly annuity
payments, if selected on a variable basis, will reflect the investment
performance of the sub-accounts selected (see "THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA SEPARATE ACCOUNT A"). Purchase payments may also be
allocated to the one year fixed account investment option or the one year DCA
fixed account investment option. Under the fixed account investment options, the
Company guarantees the principal value of purchase payments and the rate of
interest credited to the investment account for the term of the guarantee
period. The portion of the contract value in the fixed account investment option
and monthly annuity payments, if

5
<PAGE> 11

selected on a fixed basis, will reflect such interest and principal guarantees
(see "FIXED ACCOUNT INVESTMENT OPTIONS"). Subject to certain regulatory
limitations, the Company may elect to add, subtract or substitute investment
options.

Transfers. Prior to the maturity date, amounts may be transferred among
the investment options. After the maturity date, amounts may be transferred from
one sub-account to another. There is no transaction charge for transfers.
Transfers from any investment account must be at least $300 or, if less, the
entire balance in the investment account. If, after the transfer the amount
remaining in the investment account of the contract from which the transfer is
made is less than $100, then the Company will transfer the entire amount instead
of the requested amount. The Company may impose certain additional limitations
on transfers (see "TRANSFERS AMONG INVESTMENT OPTIONS" and "TRANSFERS AFTER
MATURITY DATE"). Transfer privileges may also be used under a special service
offered by the Company to dollar cost average an investment in the contract (see
"SPECIAL TRANSFER SERVICES - DOLLAR COST AVERAGING").

Withdrawals. Prior to the earlier of the maturity date or the death of
the contract owner, the owner may withdraw all or a portion of the contract
value. The amount withdrawn from any investment account must be at least $300
or, if less, the entire balance of the investment account. If a partial
withdrawal plus any applicable withdrawal charge would reduce the contract value
to less than $300, the withdrawal request will be treated as a request to
withdraw the entire contract value. A withdrawal charge and an administration
fee may be imposed (see "WITHDRAWALS"). A withdrawal may be subject to income
tax and a 10% penalty tax (see "FEDERAL TAX MATTERS"). Withdrawal privileges may
also be exercised pursuant to the Company's systematic withdrawal plan service
(see "SPECIAL WITHDRAWAL SERVICES - THE INCOME PLAN").

Loans. The Company offers a loan privilege to owners of contracts
issued in connection with Section 403(b) qualified plans that are not subject to
Title I of ERISA. Owners of such contracts may obtain loans using the contract
as the only security for the loan. The effective cost of a contract loan is 2%
per year of the amount borrowed (see "LOANS").

Confirmation Statements. Owners will be sent confirmation statements
for certain transactions in their account. Owners should carefully review these
statements to verify their accuracy. Any mistakes should immediately be reported
to the Company's Annuity Service Office. If the owner fails to notify the
Company's Annuity Service Office of any mistake within 60 days of the mailing of
the confirmation statement, the owner will be deemed to have ratified the
transaction.

Death Benefits. The Company will pay the death benefit described below
(which, as defined, is net of any debt) to the beneficiary if any contract owner
dies before the maturity date. If there is a surviving contract owner, that
contract owner will be deemed to be the beneficiary. No death benefit is payable
on the death of any annuitant, except that if any contract owner is not a
natural person, the death of any annuitant will be treated as the death of an
owner. The death benefit will be determined as of the date on which written
notice and proof of death and all required claim forms are received at the
Company's Annuity Service Office.

If any contract owner dies, the death benefit will be determined as
follows: The death benefit during the first nine contract years will be the
greater of: (a) the contract value less any payments enhancements applied in the
12 month period prior to the date of death, or (b) the excess of (i) the sum of
all purchase payments less any payment enhancements applied in the 12 month
period prior to the date of death over (ii) the sum of any amounts deducted in
connection with partial withdrawals. After the ninth contract year the death
benefit will be the greater of : (a) the contract value less any payment
enhancements applied in the 12 month period prior to the date of death or (b)
the excess of (i) the sum of all purchase payments less any payment enhancements
applied in the 12 month period prior to the date of death over (ii) the sum of
any amounts deducted in connection with partial withdrawals or (c) the death
benefit on the last day of the ninth contract year, plus the sum of all purchase
payments made and less any amount deducted in connection with partial
withdrawals since then, and less any payment enhancements applied in the 12
month period prior to the date of death.

If there is any debt under the contract, the death benefit equals the
death benefit, as described above, less such debt (see "DEATH BENEFIT BEFORE
MATURITY DATE"). If the annuitant dies after the maturity date and annuity
payments have been selected based on an annuity option providing for payments
for a guaranteed period, the Company will make the remaining guaranteed payments
to the beneficiary (see "DEATH BENEFIT ON OR AFTER MATURITY DATE").

Annuity Payments. The Company offers a variety of fixed and variable
annuity options. Periodic annuity payments will begin on the maturity date. The
contract owner selects the maturity date, frequency of payment and annuity
option (see "ANNUITY PROVISIONS").

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<PAGE> 12

Ten Day Review. Within 10 days of receipt of a contract, the contract
owner may cancel the contract by returning it to the Company (see "TEN DAY RIGHT
TO REVIEW").

Charges and Deductions. The following table and Example are designed to
assist contract owners in understanding the various costs and expenses that
contract owners bear directly and indirectly. The table reflects expenses of the
separate account and the underlying portfolio company. In addition to the items
listed in the following table, premium taxes may be applicable to certain
contracts. The items listed under "Contract Owner Transaction Expenses" and
"Separate Account Annual Expenses" are more completely described in this
Prospectus (see "CHARGES AND DEDUCTIONS"). The items listed under "Trust Annual
Expenses" are described in detail in the accompanying Trust Prospectus to which
reference should be made.

CONTRACT OWNER TRANSACTION EXPENSES

Deferred sales load (as percentage of purchase payments)*

<TABLE>
<CAPTION>
NUMBER OF COMPLETE YEARS
PURCHASE PAYMENT IN CONTRACT WITHDRAWAL CHARGE PERCENTAGE
---------------------------- ----------------------------
<S> <C>
0 8.5%
1 8.5%
2 8.0%
3 7.0%
4 6.0%
5 5.0%
6 4.0%
7 3.0%
8 2.0%
9 0.0%
</TABLE>

ANNUAL CONTRACT FEE............................................. $40(1)

SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average account value)

Mortality and expense risk fees................................. 1.25%
Administration fee ............................................. 0.30%

Total Separate Account Annual Expenses.......................... 1.55%

(1) The $40 annual administration fee will not be assessed prior to the maturity
date if at the time of its assessment the sum of all investment accounts is
greater than or equal to $100,000.

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<PAGE> 13
TRUST ANNUAL EXPENSES
(as a percentage of Trust average net assets)

<TABLE>
<CAPTION>
MANAGEMENT OTHER TOTAL TRUST
TRUST PORTFOLIO FEES EXPENSES ANNUAL EXPENSES
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Pacific Rim Emerging Markets........ 0.850% 0.570% 1.420%
Science & Technology................ 1.100% 0.160% 1.260%
International Small Cap............. 1.100% 0.210% 1.310%
Emerging Growth..................... 1.050% 0.060% 1.110%
Pilgrim Baxter Growth............... 1.050% 0.130% 1.180%
Small/Mid Cap....................... 1.000% 0.050% 1.050%
International Stock................. 1.050% 0.330% 1.380%
Worldwide Growth.................... 1.000% 0.320% 1.320%
Global Equity....................... 0.900% 0.110% 1.010%
Small Company Value................. 1.050% 0.100%* 1.150%
Equity.............................. 0.750% 0.050% 0.800%
Growth.............................. 0.850% 0.110% 1.950%
Quantitative Equity................. 0.700% 0.070% 0.770%
Blue Chip Growth.................... 0.925% 0.050% 0.975%
Real Estate Securities.............. 0.700% 0.070% 0.770%
Value............................... 0.800% 0.160% 0.960%
International Growth and Income..... 0.950% 0.170% 1.120%
Growth and Income................... 0.750% 0.040% 0.790%
Equity-Income....................... 0.800% 0.050% 0.850%
Balanced............................ 0.800% 0.080% 0.880%
Aggressive Asset Allocation......... 0.750% 0.150% 0.900%
High Yield.......................... 0.775% 0.110% 0.885%
Moderate Asset Allocation........... 0.750% 0.100% 0.850%
Conservative Asset Allocation....... 0.750% 0.140% 0.890%
Strategic Bond...................... 0.775% 0.100% 0.875%
Global Government Bond.............. 0.800% 0.130% 0.930%
Capital Growth Bond................. 0.650% 0.080% 0.730%
Investment Quality Bond............. 0.650% 0.090% 0.740%
U.S. Government Securities.......... 0.650% 0.070% 0.720%
Money Market ....................... 0.500% 0.040% 0.540%
Lifestyle Aggressive 1000#.......... 0% 1.116%** 1.116%
Lifestyle Growth 820#............... 0% 1.048%** 1.048%
Lifestyle Balanced 640#............. 0% 0.944%** 0.944%
Lifestyle Moderate 460#............. 0% 0.850%** 0.850%
Lifestyle Conservative 280#......... 0% 0.708%** 0.708%
</TABLE>

*Based on estimates of payments to be made during the current fiscal year.

8
<PAGE> 14

**Reflects expenses of the Underlying Portfolios. Manufacturers Securities
Services, LLC has voluntarily agreed to pay the expenses of each Lifestyle Trust
(excluding the expenses of the Underlying Portfolios). This voluntary expense
reimbursement may be terminated at any time after December 31, 1997. If such
expense reimbursement was not in effect, Total Trust Annual Expenses would be
.04% higher (based on expenses of the Lifestyle Trusts for the fiscal year ended
December 31, 1997) as noted in the chart below:

#Each Lifestyle Trust will invest in shares of the Underlying Portfolios.
Therefore, each Lifestyle Trust will, in addition to its own expenses, such as
certain Other Expenses, bear its pro rata share of the fees and expenses
incurred by the Underlying Portfolios and the investment return of each
Lifestyle Trust will be net of the Underlying Portfolio expenses.

EXAMPLE

A contract owner would pay the following expenses on a $1,000 investment,
assuming a 3% payment enhancement and a 5% annual return on assets, if the
contract owner surrendered the contract at the end of the applicable time
period:

<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 3 YEARS 5 YEARS* 10 YEARS*
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets........ $112 $176 $225 $347
Science & Technology................ $111 $172 $217 $331
International Small Cap............. $111 $173 $219 $336
Emerging Growth..................... $110 $168 $209 $316
Pilgrim Baxter Growth............... $110 $170 $213 $323
Small/Mid Cap....................... $109 $166 $206 $310
International Stock................. $112 $175 $223 $343
Worldwide Growth.................... $112 $174 $220 $337
Global Equity....................... $109 $165 $204 $306
Small Company Value................. $110 $169
Equity.............................. $107 $158 $193 $285
Growth.............................. $108 $163 $201 $300
Quantitative Equity................. $106 $157 $192 $282
Blue Chip Growth.................... $108 $163 $202 $303
Real Estate Securities.............. $106 $157 $192 $282
Value............................... $108 $163 $202 $301
International Growth and Income..... $110 $168 $210 $317
Growth and Income................... $107 $158 $193 $284
Equity-Income....................... $107 $160 $196 $290
Balanced............................ $107 $160 $198 $293
Aggressive Asset Allocation......... $108 $161 $199 $295
High Yield.......................... $107 $161 $198 $294
Moderate Asset Allocation........... $107 $160 $196 $290
Conservative Asset Allocation....... $107 $161 $198 $294
Strategic Bond...................... $107 $160 $197 $293
Global Government Bond.............. $108 $162 $200 $298
Capital Growth Bond................. $106 $156 $190 $278
Investment Quality Bond............. $106 $156 $190 $279
</TABLE>

9
<PAGE> 15

<TABLE>
<S> <C> <C> <C> <C>
U.S. Government Securities.......... $106 $156 $189 $277
Money Market........................ $104 $150 $180 $258
Lifestyle Aggressive 1000........... $110 $168 $210 $317
Lifestyle Growth 820................ $109 $166 $206 $310
Lifestyle Balanced 640.............. $108 $162 $201 $300
Lifestyle Moderate 460.............. $107 $160 $196 $290
Lifestyle Conservative 280.......... $106 $155 $189 $275
</TABLE>

* The example of expenses for the Small Company Value Trust contains figures for
only one and three years since it is a newly created Trust.

A contract owner would pay the following expenses on a $1,000
investment, assuming a 3% payment enhancement and a 5% annual return on assets,
if the contract owner annuitized as provided in the contract or did not
surrender the contract at the end of the applicable time period:

<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 3 YEARS 5 YEARS* 10 YEARS*
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets........ $32 $97 $165 $347
Science & Technology................ $30 $92 $157 $331
International Small Cap............. $31 $94 $159 $336
Emerging Growth..................... $29 $88 $149 $316
Pilgrim Baxter Growth............... $29 $90 $153 $323
Small/Mid Cap....................... $28 $86 $146 $310
International Stock................. $31 $96 $163 $343
Worldwide Growth.................... $31 $94 $160 $337
Small Company Value Trust........... $29 $89
Global Equity....................... $28 $85 $144 $306
Equity.............................. $25 $78 $133 $285
Growth.............................. $27 $83 $141 $300
Quantitative Equity................. $25 $77 $132 $282
Blue Chip Growth.................... $27 $83 $142 $303
Real Estate Securities.............. $25 $77 $132 $282
Value............................... $27 $83 $142 $301
International Growth and Income..... $29 $88 $150 $317
Growth and Income................... $25 $78 $133 $284
Equity-Income....................... $26 $80 $136 $290
Balanced............................ $26 $80 $138 $293
Aggressive Asset Allocation......... $26 $81 $139 $295
High Yield.......................... $26 $81 $138 $294
Moderate Asset Allocation........... $26 $80 $136 $290
Conservative Asset Allocation....... $26 $81 $138 $294
Strategic Bond...................... $26 $80 $137 $293
Global Government Bond.............. $27 $82 $140 $298
Capital Growth Bond................. $25 $76 $130 $278
Investment Quality Bond............. $25 $76 $130 $279
U.S. Government Securities.......... $25 $76 $129 $277
Money Market........................ $23 $70 $120 $258
Lifestyle Aggressive 1000........... $29 $88 $150 $317
Lifestyle Growth 820................ $28 $86 $146 $310
Lifestyle Balanced 640.............. $27 $82 $141 $300
Lifestyle Moderate 460.............. $26 $80 $136 $290
Lifestyle Conservative 280.......... $24 $75 $129 $275
</TABLE>

10
<PAGE> 16

* The example of expenses for Small Company Value Trust contains figures for
only one and three years since it is newly created Trust.

For purposes of presenting the foregoing Example, the Company has made
certain assumptions mandated by the SEC. The Company has assumed that, where
applicable, the maximum sales load is deducted, that there are no transfers or
other transactions and that the "Other Expenses" line item under "Trust Annual
Expenses" will remain the same. Such assumptions, which are mandated by the SEC
in an attempt to provide prospective investors with standardized data with which
to compare various annuity contracts, do not take into account certain features
of the contract and prospective changes in the size of the Trust which may
operate to change the expenses borne by contract owners. Consequently, the
amounts listed in the Example above should not be considered a representation of
past or future expenses and actual expenses borne by contract owners may be
greater or lesser than those shown.

In addition, for purposes of calculating the values in the above
Example, the Company has translated the $40 annual administration charge listed
under "Annual Contract Fee" to a 0.08% annual asset charge based on a $50,000
estimated approximate average size of contracts of this series. So translated,
such charge would be higher for smaller contracts and lower for larger
contracts.

* * * * * * * *

The above summary is qualified in its entirety by the detailed
information appearing elsewhere in this Prospectus and Statement of Additional
Information and the accompanying Prospectus and Statement of Additional
Information for the Trust, to which reference should be made. This Prospectus
generally describes only the variable aspects of the contract, except where
fixed aspects are specifically mentioned.

TABLE OF ACCUMULATION UNIT VALUES+

<TABLE>
<CAPTION>
------------------------------------------- ------------------------ ------------------------- -----------------------
SUB-ACCOUNT UNIT VALUE AT UNIT VALUE AT NUMBER OF UNITS
START OF YEAR* END OF YEAR AT END OF YEAR
------------------------------------------- ------------------------ ------------------------- -----------------------
<S> <C> <C> <C>
Pacific Rim Emerging Markets
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Science & Technology
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
International Small Cap
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Emerging Growth
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Pilgrim Baxter Growth
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Small/Mid Cap
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
International Stock
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Worldwide Growth
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Global Equity
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Small Company Value
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Equity
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Growth
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
</TABLE>

11
<PAGE> 17

<TABLE>
<S> <C> <C> <C>
Quantitative Equity
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Blue Chip Growth
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Real Estate Securities
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Value
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
</TABLE>

12
<PAGE> 18

TABLE OF ACCUMULATION UNIT VALUES

<TABLE>
<S> <C> <C> <C>
------------------------------------------- ------------------------ ------------------------- -----------------------
International Growth and Income
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Growth and Income
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Equity-Income
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Balanced
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Aggressive Asset Allocation
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
High Yield
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Moderate Asset Allocation
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Conservative Asset Allocation
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Strategic Bond
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Global Government Bond
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Capital Growth Bond
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Investment Quality Bond
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
U.S. Government Securities
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Money Market
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Lifestyle Aggressive 1000
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Lifestyle Growth 820
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Lifestyle Balanced 640
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Lifestyle Moderate 460
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
Lifestyle Conservative 280
1997 $12.500000
------------------------------------------- ------------------------ ------------------------- -----------------------
</TABLE>

* Units under the series of contracts were first credited under the sub-account
on August 4, 1997, except in the case of the Small Company Value Trust where
units were first credited under the sub-accounts on October 1, 1997.

13
<PAGE> 19

GENERAL INFORMATION ABOUT THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA,
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA SEPARATE ACCOUNT A
AND MANUFACTURERS INVESTMENT TRUST

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA

The Manufacturers Life Insurance Company of North America, formerly
North American Security Life Insurance Company (the "Company") is a stock life
insurance company organized under the laws of Delaware in 1979. The Company's
principal office is located at 116 Huntington Avenue, Boston, Massachusetts
02116. The ultimate parent of the Company is The Manufacturers Life Insurance
Company ("Manulife"), a Canadian mutual life insurance company based in Toronto,
Canada. Prior to January 1, 1996, the Company was a wholly owned subsidiary of
North American Life Assurance Company ("NAL"), a Canadian mutual life insurance
company. On January 1, 1996 NAL and Manulife merged with the combined company
retaining the Manulife name.

On January 19, 1998, the Board of Directors of Manulife asked the
management of Manulife to prepare a plan for conversion of Manulife from a
mutual life insurance company to an investor-owned, publicly-traded stock
company. Any demutualization plan for Manulife is subject to the approval of the
Manulife Board of Directors and policyholders as well as regulatory approval.

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA SEPARATE ACCOUNT A

The Company established the Variable Account on August 24, 1984 as a
separate account under Delaware law. The income, gains and losses, whether or
not realized, from assets of the Variable Account are, in accordance with the
contracts, credited to or charged against the Variable Account without regard to
other income, gains or losses of the Company. Nevertheless, all obligations
arising under the contracts are general corporate obligations of the Company.
Assets of the Variable Account may not be charged with liabilities arising out
of any other business of the Company.

The Variable Account is registered with the SEC under the Investment
Company Act of 1940, as amended (the "1940 Act") as a unit investment trust. A
unit investment trust is a type of investment company which invests its assets
in specified securities, such as the shares of one or more investment companies.
Registration under the 1940 Act does not involve supervision by the SEC of the
management or investment policies or practices of the Variable Account. If
deemed by the Company to be in the best interests of persons having voting
rights under the contracts, the Variable Account may be operated as a management
company under the 1940 Act or it may be deregistered under such Act in the event
such registration is no longer required.

There are currently thirty-five sub-accounts within the Variable
Account. The Company reserves the right, subject to compliance with applicable
law, to add other sub-accounts, eliminate existing sub-accounts, combine
sub-accounts or transfer assets in one sub-account to another sub-account
established by the Company or an affiliated company. The Company will not
eliminate existing sub-accounts or combine sub-accounts without the prior
approval of the appropriate state or Federal regulatory authorities.

MANUFACTURERS INVESTMENT TRUST

The assets of each sub-account of the Variable Account are invested in
shares of a corresponding portfolio of Manufacturers Investment Trust (the
"Trust"). A description of each portfolio is set forth below. The Trust is
registered under the 1940 Act as an open-end management investment company. Each
of the portfolios is diversified for purposes of the 1940 Act, except for the
Global Government Bond Trust, Emerging Growth Trust and the five Lifestyle
Trusts which are non-diversified. The Trust receives investment advisory
services from Manufacturers Securities Services, LLC ("MSS") (The successor to
NASL Financial Services, Inc.).

14
<PAGE> 20

The Trust currently has fifteen subadvisers who manage all of the
portfolios:

<TABLE>
<CAPTION>
SUBADVISER SUBADVISER TO
---------- -------------
<S> <C>
Fidelity Management Trust Company Equity Trust
Conservative Asset Allocation Trust
Moderate Asset Allocation Trust
Aggressive Asset Allocation Trust

Founders Asset Management LLC Growth Trust
Worldwide Growth Trust
Balanced Trust
International Small Cap Trust

Fred Alger Management, Inc. Small/Mid Cap Trust

J.P. Morgan Investment Management Inc. International Growth and Income Trust

Manufacturers Adviser Corporation Pacific Rim Emerging Markets Trust
Quantitative Equity Trust
Real Estate Securities Trust
Capital Growth Bond Trust
Money Market Trust
Lifestyle Trusts

Miller Anderson & Sherrerd, LLP Value Trust
High Yield Trust

Morgan Stanley Asset Management Inc. Global Equity Trust

Oechsle International Advisors, L.P. Global Government Bond Trust

Pilgrim Baxter & Associates, Ltd. Pilgrim Baxter Growth Trust

Rosenberg Institutional Equity Management Small Company Value Trust

Rowe Price-Fleming International, Inc. International Stock Trust

Salomon Brothers Asset Management Inc U.S. Government Securities Trust
Strategic Bond Trust

T. Rowe Price Associates, Inc. Science & Technology Trust
Blue Chip Growth Trust
Equity-Income Trust

Warburg Pincus Asset Management, Inc. Emerging Growth Trust

Wellington Management Company, LLP Growth and Income Trust
Investment Quality Bond Trust
</TABLE>

The following is a brief description of each portfolio:

The PACIFIC RIM EMERGING MARKETS TRUST seeks long-term growth of
capital by investing in a diversified portfolio that is comprised primarily of
common stocks and equity-related securities of corporations domiciled in
countries in the Pacific Rim region.

15
<PAGE> 21
The SCIENCE & TECHNOLOGY TRUST seeks long-term growth of capital.
Current income is incidental to the portfolio's objective.

The INTERNATIONAL SMALL CAP TRUST seeks capital appreciation by
investing primarily in securities issued by foreign companies which have total
market capitalization or annual revenues of $1 billion or less. These securities
may represent companies in both established and emerging economies throughout
the world.

The EMERGING GROWTH TRUST seeks maximum capital appreciation by
investing primarily in a portfolio of equity securities of domestic companies.
The Emerging Growth Trust ordinarily will invest at least 65% of its total
assets in common stocks or warrants of emerging growth companies that represent
attractive opportunities for maximum capital appreciation.

The PILGRIM BAXTER GROWTH TRUST seeks capital appreciation by investing
in companies believed by the subadviser to have an outlook for strong earnings
growth and the potential for significant capital appreciation.

The SMALL/MID CAP TRUST seeks long-term capital appreciation by
investing at least 65% of its total assets (except during temporary defensive
periods) in small/mid cap equity securities. As used herein small/mid cap equity
securities are equity securities of companies that, at the time of purchase,
have total market capitalization between $500 million and $5 billion.

The INTERNATIONAL STOCK TRUST seeks long-term growth of capital by
investing primarily in common stocks of established, non-U.S. companies.

The WORLDWIDE GROWTH TRUST seeks long-term growth of capital by
normally investing at least 65% of its total assets in equity securities of
growth companies in a variety of markets throughout the world.

The GLOBAL EQUITY TRUST seeks long-term capital appreciation by
investing primarily in equity securities throughout the world, including U.S.
issuers and emerging markets.

The SMALL COMPANY VALUE TRUST seeks long term growth of capital by
investing in equity securities of smaller companies which are traded principally
in the markets of the United States.

The EQUITY TRUST seeks growth of capital by investing primarily in
common stocks of United States issuers and securities convertible into or
carrying the right to buy common stocks.

The GROWTH TRUST seeks long-term growth of capital by investing at
least 65% of the portfolio's total assets in the common stocks of
well-established, high-quality growth companies that the subadviser believes
have the potential to increase earnings faster than the rest of the market.

The QUANTITATIVE EQUITY TRUST seeks to achieve intermediate and
long-term growth through capital appreciation and current income by investing in
common stocks and other equity securities of well established companies with
promising prospects for providing an above average rate of return.

The BLUE CHIP GROWTH TRUST seeks to achieve long-term growth of capital
(current income is a secondary objective) and many of the stocks in the
portfolio are expected to pay dividends.

The REAL ESTATE SECURITIES TRUST seeks to achieve a combination of
long-term capital appreciation and satisfactory current income by investing in
real estate related equity and debt securities.

The VALUE TRUST seeks to realize an above-average total return over a
market cycle of three to five years, consistent with reasonable risk, by
investing primarily in common and preferred stocks, convertible securities,
rights and warrants to purchase common stocks, ADRs and other equity securities
of companies with equity capitalizations usually greater than $300 million.

16
<PAGE> 22

The INTERNATIONAL GROWTH AND INCOME TRUST seeks long-term growth of
capital and income by investing, under normal circumstances, at least 65% of its
total assets in equity securities of foreign issuers. The portfolio may also
invest in debt securities of corporate or sovereign issuers rated A or higher by
Moody's Investor Services, Inc. or Standard & Poor's Corporation or, if unrated,
of equivalent credit quality as determined by the subadviser.

The GROWTH AND INCOME TRUST seeks long-term growth of capital and
income, consistent with prudent investment risk, by investing primarily in a
diversified portfolio of common stocks of United States issuers which the
subadviser believes are of high quality.

The EQUITY-INCOME TRUST seeks to provide substantial dividend income
and also long-term capital appreciation by investing primarily in
dividend-paying common stocks, particularly of established companies with
favorable prospects for both increasing dividends and capital appreciation.

The BALANCED TRUST seeks current income and capital appreciation by
investing in a balanced portfolio of common stocks, U.S. and foreign government
obligations and a variety of corporate fixed-income securities.

The HIGH YIELD TRUST seeks to realize an above-average total return
over a market cycle of three to five years, consistent with reasonable risk, by
investing primarily in high yield debt securities, including corporate bonds and
other fixed-income securities.

The AUTOMATIC ASSET ALLOCATION TRUSTS seek the highest potential total
return consistent with a specified level of risk tolerance -- conservative,
moderate or aggressive -- by investing primarily in the kinds of securities in
which the Equity, Investment Quality Bond, U.S. Government Securities and Money
Market Trusts may invest.

- The AGGRESSIVE ASSET ALLOCATION TRUST seeks the highest total
return consistent with an aggressive level of risk tolerance. This
Trust attempts to limit the decline in portfolio value in very
adverse market conditions to 15% over any three year period.

- The MODERATE ASSET ALLOCATION TRUST seeks the highest total return
consistent with a moderate level of risk tolerance. This Trust
attempts to limit the decline in portfolio value in very adverse
market conditions to 10% over any three year period.

- The CONSERVATIVE ASSET ALLOCATION TRUST seeks the highest total
return consistent with a conservative level of risk tolerance.
This Trust attempts to limit the decline in portfolio value in
very adverse market conditions to 5% over any three year period.

The STRATEGIC BOND TRUST seeks a high level of total return consistent
with preservation of capital by giving its subadviser broad discretion to deploy
the portfolio's assets among certain segments of the fixed-income market as the
subadviser believes will best contribute to achievement of the portfolio's
investment objective.

The GLOBAL GOVERNMENT BOND TRUST seeks a high level of total return by
placing primary emphasis on high current income and the preservation of capital
by investing primarily in a global portfolio of high-quality, fixed-income
securities of foreign and United States governmental entities and supranational
issuers.

The CAPITAL GROWTH BOND TRUST seeks to achieve growth of capital by
investing in medium-grade or better debt securities, with income as a secondary
consideration. The Capital Growth Bond Trust differs from most "bond" funds in
that its primary objective is capital appreciation, not income.

The INVESTMENT QUALITY BOND TRUST seeks a high level of current income
consistent with the maintenance of principal and liquidity, by investing
primarily in a diversified portfolio of investment grade corporate bonds and
U.S. Government bonds with intermediate to longer term maturities. The portfolio
may also invest up to 20% of its assets in non-investment grade fixed income
securities.

17
<PAGE> 23
The U.S. GOVERNMENT SECURITIES TRUST seeks a high level of current
income consistent with preservation of capital and maintenance of liquidity, by
investing in debt obligations and mortgage-backed securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities and
derivative securities such as collateralized mortgage obligations backed by such
securities.

The MONEY MARKET TRUST seeks maximum current income consistent with
preservation of principal and liquidity by investing in high quality money
market instruments with maturities of 397 days or less issued primarily by
United States entities.

The LIFESTYLE AGGRESSIVE 1000 TRUST seeks to provide long-term growth
of capital (current income is not a consideration) by investing 100% of the
Lifestyle Trust's assets in other portfolios of the Trust ("Underlying
Portfolios") which invest primarily in equity securities.

The LIFESTYLE GROWTH 820 TRUST seeks to provide long-term growth of
capital with consideration also given to current income by investing
approximately 20% of the Lifestyle Trust's assets in Underlying Portfolios which
invest primarily in fixed income securities and approximately 80% of its assets
in Underlying Portfolios which invest primarily in equity securities.

The LIFESTYLE BALANCED 640 TRUST seeks to provide a balance between a
high level of current income and growth of capital with a greater emphasis given
to capital growth by investing approximately 40% of the Lifestyle Trust's assets
in Underlying Portfolios which invest primarily in fixed income securities and
approximately 60% of its assets in Underlying Portfolios which invest primarily
in equity securities.

The LIFESTYLE MODERATE 460 TRUST seeks to provide a balance between a
high level of current income and growth of capital with a greater emphasis given
to high income by investing approximately 60% of the Lifestyle Trust's assets in
Underlying Portfolios which invest primarily in fixed income securities and
approximately 40% of its assets in Underlying Portfolios which invest primarily
in equity securities.

The LIFESTYLE CONSERVATIVE 280 TRUST seeks to provide a high level of
current income with some consideration also given to growth of capital by
investing approximately 80% of the Lifestyle Trust's assets in Underlying
Portfolios which invest primarily in fixed income securities and approximately
20% of its assets in Underlying Portfolios which invest primarily in equity
securities.

In pursuing the Strategic Bond, High Yield and Investment Quality Bond
Trusts' investment objective, each portfolio expects to invest a portion of its
assets in high yield securities, commonly known as "junk bonds" which also
present a high degree of risk. The risks of these securities include price
volatility and risk of default in the payment of interest and principle. See
"Risk Factors Relating to High Yield Securities" contained in the Trust
Prospectus before investing in any of these Trusts.

In pursuing the Pacific Rim Emerging Markets, International Stock,
Worldwide Growth, International Small Cap, Global Equity, Strategic Bond,
International Growth and Income, High Yield and Global Government Bond Trusts'
investment objective, each portfolio may invest up to 100% of its assets in
foreign securities which may present additional risks. See "Foreign Securities"
in the Trust Prospectus before investing in any of these Trusts.

If the shares of a Trust portfolio are no longer available for
investment or in the Company's judgment investment in a Trust portfolio becomes
inappropriate in view of the purposes of the Variable Account, the Company may
eliminate the shares of a portfolio and substitute shares of another portfolio
of the Trust or another open-end registered investment company. Substitution may
be made with respect to both existing investments and the investment of future
purchase payments. However, no such substitution will be made without notice to
the contract owner and prior approval of the SEC to the extent required by the
1940 Act.

The Company will vote shares of the Trust portfolios held in the
Variable Account at meetings of shareholders of the Trust in accordance with
voting instructions received from the persons having the voting interest under
the contracts. The number of portfolio shares for which voting instructions may
be given will be determined by the Company in the manner described below, not
more than 90 days prior to the meeting of the Trust. Trust proxy material will
be distributed to each person having the voting interest under the contract
together with appropriate forms for giving voting instructions. Portfolio shares
held in the Variable Account that are attributable to contract owners and as to
which no timely instructions are received and portfolio shares held in the
Variable Account that are beneficially owned by the Company will be voted by the
Company in proportion to the instructions received.

18
<PAGE> 24

Prior to the maturity date, the person having the voting interest under
a contract is the contract owner and the number of votes as to each portfolio
for which voting instructions may be given is determined by dividing the value
of the investment account corresponding to the sub-account in which such
portfolio shares are held by the net asset value per share of that portfolio.
After the maturity date, the person having the voting interest under a contract
is the annuitant and the number of votes as to each portfolio for which voting
instructions may be given is determined by dividing the reserve for the contract
allocated to the sub-account in which such portfolio shares are held by the net
asset value per share of that portfolio. Generally, the number of votes tends to
decrease as annuity payments progress since the amount of reserves attributable
to a contract will usually decrease after commencement of annuity payments. The
Company reserves the right to make any changes in the voting rights described
above that may be permitted by the Federal securities laws or regulations or
interpretations of these laws or regulations.

A full description of the Trust, including the investment objectives,
policies and restrictions of each of the portfolios is contained in the
Prospectus for the Trust which accompanies this Prospectus and should be read by
a prospective purchaser before investing.

DESCRIPTION OF THE CONTRACT

ACCUMULATION PROVISIONS

PURCHASE PAYMENTS

Purchase payments are paid to the Company at its Annuity Service
Office. The minimum initial purchase payment is $10,000. Minimum subsequent
purchase payments must be at least $30. Purchase payments may be made at any
time. The Company may provide for purchase payments to be automatically
withdrawn from a contract owner's bank account on a periodic basis. If a
purchase payment would cause the contract value to exceed $1,000,000 or the
contract value already exceeds $1,000,000, additional purchase payments will be
accepted only with the prior approval of the Company.

The Company may, at its option, cancel a contract at the end of any two
consecutive contract years in which no purchase payments have been made, if both
(i) the total purchase payments made over the life of the contract, less any
withdrawals, are less than $2,000; and (ii) the contract value at the end of
such two year period is less than $2,000. The cancellation of contract
privileges may vary in certain states in order to comply with the requirements
of insurance laws and regulations in such state. Upon cancellation the Company
will pay the contract owner the contract value computed as of the valuation
period during which the cancellation occurs less any debt and less the annual
$40 administration fee. The amount paid will be treated as a withdrawal for
Federal tax purposes and thus may be subject to income tax and to a 10% penalty
tax (see "FEDERAL TAX MATTERS").

Purchase payments are allocated among the investment options in
accordance with the percentages designated by the contract owner. The contract
owner may change the allocation of subsequent purchase payments at any time upon
written notice to the Company or by telephone in accordance with the Company's
telephone transfer procedures.

PAYMENT ENHANCEMENTS

At the time a purchase payment is paid to the Company by a contract
owner, the Company will add a payment enhancement to the owner's contract. The
payment enhancement is funded from the Company's general account. The payment
enhancement is allocated among investment options in the same proportion as the
applicable purchase payment. The amount available as a death benefit is reduced
by payment enhancements applied in the prior 12 month period (see "DEATH BENEFIT
BEFORE MATURITY DATE"). The amount returned if the contract owner exercises his
or her right to return the contract during the "ten day right to review" period
is reduced by any payment enhancements applied (see "TEN DAY RIGHT TO REVIEW").

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<PAGE> 25
The payment enhancement depends on the cumulative amount of purchase
payments. The payment enhancements, as a percentage of purchase payments are set
out below:

<TABLE>
<CAPTION>
Cumulative Purchase Payments Payment Enhancement
- ---------------------------- -------------------
<S> <C>
Less than $500,000 3.0%

$500,000 or more but less than $2,500,000 4.0%

$2,500,000 or more 5.0%
</TABLE>

Payment enhancements are payable only as a percentage of each specific purchase
payment. An example of the calculation of the payment enhancement is set forth
in Appendix D.

Payment enhancements are not considered to be "investment in the contract" for
income tax purposes (see "FEDERAL TAX MATTERS").

Letter of Intent. The next higher payment enhancement percentage may be applied
to the initial purchase payment. To receive the higher percentage, the contract
owner must provide the Company with evidence satisfactory to the Company that
the contract owner will submit total purchase payments within 13 months of the
issue date of the contract sufficient to achieve one of the breakpoints shown
above under "Cumulative Purchase Payments" (referred to as a "Letter of
Intent"). Satisfactory evidence will require, but is not limited to, a minimum
initial purchase payment of at least 50% of the breakpoint at which the Payment
Enhancement is to be determined. The Company reserves the right to recover an
amount from the contract if total purchase payments received within 13 months
from the issue date of the contract do not equal or exceed the amount of the
breakpoint used to determine the payment enhancement. The amount the Company may
recover is the greater of (a) or (b) where:

(a) is the amount of Payment Enhancement applied to the contract less the amount
of Payment Enhancement that would have been applied to the contract had the
contract owner not submitted a Letter of Intent (the "Excess Payment
Enhancement"), and

(b) the contract value multiplied by the ratio of the Excess Payment Enhancement
over total purchase payments (which exclude the payment enhancement) applied to
the contract.

Amounts recovered will be withdrawn from each investment option in the same
proportion that the value of the investment account of each investment option
bears to the contract value. IN THE EVENT THE VALUE OF ACCUMULATION UNITS FOR AN
INVESTMENT OPTION WHICH HAS BEEN ALLOCATED A PAYMENT ENHANCEMENT DECLINES, THE
COMPANY RETAINS THE RIGHT TO RECOVER THE ORIGINAL AMOUNT OF PAYMENT ENHANCEMENT
CREDITED TO THE INVESTMENT OPTION. THEREFORE, THE CONTRACT OWNER BEARS THE RISK
THAT IF THE LETTER OF INTENT IS NOT COMPLETED, THE VALUE OF THE CONTRACT MAY BE
LESS THAN HAD THE LETTER OF INTENT NOT BEEN EXECUTED. IF THE AMOUNT RECOVERED
EXCEEDS THE CONTRACT VALUE, THE COMPANY WILL TERMINATE THE CONTRACT WITHOUT
VALUE.

IF THE CONTRACT OWNER FAILS TO INFORM THE COMPANY THAT HE OR SHE INTENDS TO
SUBMIT MULTIPLE PAYMENTS WITHIN 13 MONTHS OF THE CONTRACT ISSUE DATE, THE
CONTRACT MAY RECEIVE A LOWER PAYMENT ENHANCEMENT PERCENTAGE THAN WOULD OTHERWISE
BE AVAILABLE FOR THE CONTRACT.

ACCUMULATION UNITS

The Company will establish an investment account for the contract owner
for each investment option to which such contract owner allocates purchase
payments. Purchase payments (and any payment enhancement included therewith) are
credited to such investment accounts in the form of accumulation units. The
following discussion of accumulation units, the value of accumulation units and
the net investment factor formula pertains only to the accumulations in the
variable account investment options. The parallel discussion regarding
accumulations in the fixed account investment options appears elsewhere in this
Prospectus (see "Fixed Account Investment Options"). The number of accumulation
units to be credited to each investment account is determined by dividing the
net purchase payment allocated to that investment account by the value of an
accumulation unit for that investment account for the valuation period during
which the purchase payment is received at the

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<PAGE> 26
Company's Annuity Service Office complete with all necessary information or, in
the case of the first purchase payment, pursuant to the procedures described
below.

Initial purchase payments received by mail will usually be credited in
the valuation period during which received at the Annuity Service Office, and in
any event not later than two business days after receipt of all information
necessary for processing issuance of the contract. The applicant will be
informed of any deficiencies preventing processing if the contract cannot be
issued and the purchase payment credited within two business days after receipt.
If the deficiencies are not remedied within five business days after receipt,
the purchase payment will be returned promptly to the applicant, unless the
applicant specifically consents to the Company's retaining the purchase payment
until all necessary information is received. Initial purchase payments received
by wire transfer from broker-dealers will be credited in the valuation period
during which received where such broker-dealers have made special arrangements
with the Company.

VALUE OF ACCUMULATION UNITS

The value of accumulation units will vary from one valuation period to
the next depending upon the investment results of the particular sub-accounts to
which purchase payments are allocated. The value of an accumulation unit for
each sub-account was arbitrarily set at $10 or $12.50 for the first valuation
period under other contracts issued by the Company. The value of an accumulation
unit for any subsequent valuation period is determined by multiplying the value
of an accumulation unit for the immediately preceding valuation period by the
net investment factor for such sub-account (described below) for the valuation
period for which the value is being determined.

NET INVESTMENT FACTOR

The net investment factor is an index used to measure the investment
performance of a sub-account from one valuation period to the next. The net
investment factor for each sub-account for any valuation period is determined by
dividing (a) by (b) and subtracting (c) from the result:

Where (a) is:

(1) the net asset value per share of a portfolio share held in
the sub-account determined at the end of the current valuation period,
plus

(2) the per share amount of any dividend or capital gain
distributions made by the portfolio on shares held in the sub-account
if the "ex-dividend" date occurs during the current valuation period.

Where (b) is:

the net asset value per share of a portfolio share held in the
sub-account determined as of the end of the immediately preceding
valuation period.

Where (c) is:

a factor representing the charges deducted from the
sub-account on a daily basis for administrative expenses and mortality
and expense risks. Such factor is equal on an annual basis to 1.55%
(0.30% for administrative expenses and 1.25% for mortality and expense
risks). The charges deducted from the sub-account reduce the value of
the accumulation units for the sub-account.

The net investment factor may be greater or less than or equal to one;
therefore, the value of an accumulation unit may increase, decrease or remain
the same.

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<PAGE> 27
TRANSFERS AMONG INVESTMENT OPTIONS

Before the maturity date the contract owner may transfer amounts among
the investment options at any time and without charge upon written notice to the
Company or by telephone if the contract owner authorizes the Company in writing
to accept telephone transfer requests. Accumulation units will be canceled from
the investment account from which amounts are transferred and credited to the
investment account to which amounts are transferred. The Company will effect
such transfers so that the contract value on the date of the transfer will not
be affected by the transfer. The contract owner must transfer at least $300 or,
if less, the entire value of the investment account. If after the transfer the
amount remaining in the investment account is less than $100, then the Company
will transfer the entire amount instead of the requested amount. The Company
reserves the right to limit, upon notice, the maximum number of transfers a
contract owner may make to one per month or six at any time within a contract
year. In addition, the Company reserves the right to defer the transfer
privilege at any time that the Company is unable to purchase or redeem shares of
the Trust portfolios. The Company also reserves the right to modify or terminate
the transfer privilege at any time in accordance with applicable law.

MAXIMUM NUMBER OF INVESTMENT OPTIONS

Due to current administrative capabilities, a contract owner is limited
to a maximum of seventeen investment options (including the one year fixed
account investment option) during the period prior to the maturity date of the
contract (the "Contract Period"). In calculating this limit for each contract
owner, investment options to which the contract owner has allocated purchase
payments at any time during the Contract Period will be counted toward the
seventeen maximum even if the contract owner no longer has contract value
allocated to the investment option.

TELEPHONE TRANSACTIONS

Contract owners are permitted to request transfers/redemptions by
telephone. The Company will not be liable for following instructions
communicated by telephone that it reasonably believes to be genuine. To be
permitted to request a transfer/redemption by telephone, a contract owner must
elect the option on the Application. (If a contract owner does not initially
elect an option in the Application form, he or she may request authorization by
executing an appropriate authorization form provided by the Company upon
request.) The Company will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine and may only be liable for
any losses due to unauthorized or fraudulent instructions where it fails to
employ its procedures properly. Such procedures include the following. Upon
telephoning a request, contract owners will be asked to provide their account
number, and if not available, their social security number. For the contract
owner's and Company's protection, all conversations with contract owners will be
tape recorded. All telephone transactions will be followed by a confirmation
statement of the transaction.

SPECIAL TRANSFER SERVICES - DOLLAR COST AVERAGING

The Company administers a Dollar Cost Averaging ("DCA") program which
enables a contract owner to pre-authorize a periodic exercise of the contractual
transfer rights described above. Contract owners entering into a DCA agreement
instruct the Company to transfer monthly a predetermined dollar amount from any
sub-account or the one year fixed account investment option to other
sub-accounts until the amount in the sub-account from which the transfer is made
or the one year fixed account investment option is exhausted. Except in the
states of __________, a special one year fixed account investment option (the
"One Year DCA Account") may be established under the DCA program to make
automatic monthly transfers. In the first eleven months the amount transferred
is equal to one eleventh of the amount allocated to the One Year DCA Account and
in the twelfth month the remaining balance of the One Year DCA Account is
transferred. Only initial and subsequent net payments may be allocated to the
One Year DCA Account. The DCA program is generally suitable for contract owners
making a substantial deposit to the contract and who desire to control the risk
of investing at the top of a market cycle. The DCA program allows such
investments to be made in equal installments over time in an effort to reduce
such risk. Contract owners interested in the DCA program may elect to
participate in the program on the contract application or by separate
application. Contract owners may obtain a separate application and full
information concerning the program and its restrictions from their securities
dealer or the Annuity Service Office. There is no charge for participation in
the DCA program.

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<PAGE> 28
ASSET REBALANCING PROGRAM

The Company administers an Asset Rebalancing Program which enables a
contract owner to indicate to the Company the percentage levels he or she would
like to maintain in particular portfolios. The contract owner's contract value
will be automatically rebalanced pursuant to the schedule described below to
maintain the indicated percentages by transfers among the portfolios. The Fixed
Account Investment Options are not eligible for participation in the Asset
Rebalancing Program. The entire value of the variable investment accounts must
be included in the Asset Rebalancing Program. Other investment programs, such as
the DCA program, or other transfers or withdrawals may not work in concert with
the Asset Rebalancing Program. Therefore, contract owners should monitor their
use of these other programs and any other transfers or withdrawals while the
Asset Rebalancing Program is being used. Contract owners interested in the Asset
Rebalancing Program may obtain a separate application and full information
concerning the program and its restrictions from their securities dealer or the
Annuity Service Office. There is no charge for participation in the Asset
Rebalancing Program.

Asset rebalancing will only be permitted on the following time
schedules:

(i) quarterly on the 25th day of the last month of the quarter (or the
next business day if the 25th is not a business day);
(ii) semi-annually on June 25th or December 26th (or the next business
day if these dates are not business days); or
(iii) annually on December 26th (or the next business day if December
26th is not a business day).

WITHDRAWALS

Prior to the earlier of the maturity date or the death of the contract
owner, the owner may withdraw all or a portion of the contract value upon
written request, complete with all necessary information to the Company's
Annuity Service Office. For certain qualified contracts, exercise of the
withdrawal right may require the consent of the qualified plan participant's
spouse under the Code and regulations promulgated by the Treasury Department. In
the case of a total withdrawal, the Company will pay the contract value as of
the date of receipt of the request at its Annuity Service Office, less the
annual $40 administration fee if applicable, any debt and any applicable
withdrawal charge, and the contract will be canceled. In the case of a partial
withdrawal, the Company will pay the amount requested and cancel that number of
accumulation units credited to each investment account necessary to equal the
amount withdrawn from each investment account plus any applicable withdrawal
charge deducted from such investment account (see "CHARGES AND DEDUCTIONS").

When making a partial withdrawal, the contract owner should specify the
investment options from which the withdrawal is to be made. The amount requested
from an investment option may not exceed the value of that investment option
less any applicable withdrawal charge. If the contract owner does not specify
the investment options from which a partial withdrawal is to be taken, the
withdrawal will be taken from the variable account investment options until
exhausted and then from the fixed account investment options. If the partial
withdrawal is less than the total value in the variable account investment
option, the withdrawal will be taken pro rata from the variable account
investment options: taking from each such variable account investment option an
amount which bears the same relationship to the total amount withdrawn as the
value of such variable account investment option bears to the total value of all
the contract owner's investments in variable account investment options. For
rules governing the order and manner of withdrawals from the fixed account
investment options, see "FIXED ACCOUNT INVESTMENT OPTION".

There is no limit on the frequency of partial withdrawals; however, the
amount withdrawn must be at least $300 or, if less, the entire balance in the
investment option. If after the withdrawal (and deduction of any withdrawal
charge) the amount remaining in the investment option is less than $100, the
Company will treat the partial withdrawal as a withdrawal of the entire amount
held in the investment option. If a partial withdrawal plus any applicable
withdrawal charge would reduce the contract value to less than $300, the Company
will treat the partial withdrawal as a total withdrawal of the contract value.

The amount of any withdrawal from the variable account investment
options will be paid promptly, and in any event within seven days of receipt of
the request, complete with all necessary information at the Company's Annuity
Service Office, except that the Company reserves the right to defer the right of
withdrawal or postpone payments for any period when: (1) the New York Stock
Exchange is closed (other than customary weekend and holiday closings), (2)
trading on the New York Stock Exchange is restricted, (3) an emergency exists as
a result of which disposal of securities held in the Variable Account is not
reasonably practicable or it is not reasonably practicable to determine the
value of the Variable Account's net assets, or (4) the SEC, by order, so

23
<PAGE> 29

permits for the protection of security holders; provided that applicable rules
and regulations of the SEC shall govern as to whether the conditions described
in (2) and (3) exist.

Withdrawals from the contract may be subject to income tax and a 10%
penalty tax. Withdrawals are permitted from contracts issued in connection with
Section 403(b) qualified plans only under limited circumstances (see "FEDERAL
TAX MATTERS").

TELEPHONE REDEMPTIONS

The contract owner may request the option to withdraw a portion of the
contract value by telephone by completing the application described under
"Telephone Transactions" above. The Company reserves the right to impose maximum
withdrawal amounts and procedural requirements regarding this privilege. For
additional information on Telephone Redemptions see "Telephone Transactions"
above.

SPECIAL WITHDRAWAL SERVICES - THE INCOME PLAN

The Company administers an Income Plan ("IP") which enables a contract
owner to pre-authorize a periodic exercise of the contractual withdrawal rights
described above. Contract owners entering into an IP agreement instruct the
Company to withdraw a level dollar amount from specified investment options on a
periodic basis. The total of IP withdrawals in a contract year is limited to not
more than 10% of the purchase payments made to ensure that no withdrawal charge
will ever apply to an IP withdrawal. If an additional withdrawal is made from a
contract participating in an IP, the IP will terminate automatically and may be
reinstated only on or after the next contract anniversary pursuant to a new
application. The IP is not available to contracts participating in the dollar
cost averaging program or for which purchase payments are being automatically
deducted from a bank account on a periodic basis. IP withdrawals will be free of
withdrawal charges. IP withdrawals may, however, be subject to income tax and a
10% penalty tax (see "FEDERAL TAX MATTERS"). Contract owners interested in an IP
may obtain a separate application and full information concerning the program
and its restrictions from their securities dealer or the Annuity Service Office.

LOANS

The Company offers a loan privilege only to owners of contracts issued
in connection with Section 403(b) qualified plans that are not subject to Title
I of ERISA. Owners of such contracts may obtain loans using the contract as the
only security for the loan. Loans are subject to provisions of the Code and to
applicable retirement program rules (collectively, "loan rules"). Tax advisors
and retirement plan fiduciaries should be consulted prior to exercising loan
privileges.

Under the terms of the contract, the maximum loan value is equal to 80%
of the contract value, although loan rules may serve to reduce such maximum loan
value in some cases. The amount available for a loan at any given time is the
loan value less any outstanding debt. Debt equals the amount of any loans plus
accrued interest. Loans will be made only upon written request from the owner.
The Company will make loans within seven days of receiving a properly completed
loan application (applications are available from the Annuity Service Office),
subject to postponement under the same circumstances that payment of withdrawals
may be postponed (see "WITHDRAWALS").

When an owner requests a loan, the Company will reduce the owner's
investment in the investment accounts and transfer the amount of the loan to the
loan account, a part of the Company's general account. The owner may designate
the investment accounts from which the loan is to be withdrawn. Absent such a
designation, the amount of the loan will be withdrawn from the investment
accounts in accordance with the rules for making partial withdrawals (see
"WITHDRAWALS"). The contract provides that owners may repay contract debt at any
time. Under applicable loan rules, loans generally must be repaid within five
years, repayments must be made at least quarterly and repayments must be made in
substantially equal amounts. When a loan is repaid, the amount of the repayment
will be transferred from the loan account to the investment accounts. The owner
may designate the investment accounts to which a repayment is to be allocated.
Otherwise, the repayment will be allocated in the same manner as the owner's
most recent purchase payment. On each contract anniversary, the Company will
transfer from the investment accounts to the loan account the amount by which
the debt on the contract exceeds the balance in the loan account.

The Company charges interest of 6% per year on contract loans. Loan
interest is payable in arrears and, unless paid in cash, the accrued loan
interest is added to the amount of the debt and bears interest at 6% as well.
The Company credits interest with

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<PAGE> 30
respect to amounts held in the loan account at a rate of 4% per year.
Consequently, the net cost of loans under the contract is 2%. If on any date
debt under a contract exceeds the contract value, the contract will be in
default. In such case the owner will receive a notice indicating the payment
needed to bring the contract out of default and will have a thirty-one day grace
period within which to pay the default amount. If the required payment is not
made within the grace period, the contract may be foreclosed (terminated without
value).

The amount of any debt will be deducted from the death benefit
otherwise payable under the contract (see "DEATH BENEFIT BEFORE MATURITY DATE").
In addition, debt, whether or not repaid, will have a permanent effect on the
contract value because the investment results of the investment accounts will
apply only to the unborrowed portion of the contract value. The longer debt is
outstanding, the greater the effect is likely to be. The effect could be
favorable or unfavorable. If the investment results are greater than the rate
being credited on amounts held in the loan account while the debt is
outstanding, the contract value will not increase as rapidly as it would have if
no debt were outstanding. If investment results are below that rate, the
contract value will be higher than it would have been had no debt been
outstanding.

DEATH BENEFIT BEFORE MATURITY DATE

In General. The following discussion applies principally to contracts
that are not issued in connection with qualified plans, i.e., a "non-qualified
contract." The requirements of the tax law applicable to qualified plans, and
the tax treatment of amounts held and distributed under such plans, are quite
complex. Accordingly, a prospective purchaser of the contract to be used in
connection with a qualified plan should seek competent legal and tax advice
regarding the suitability of the contract for the situation involved and the
requirements governing the distribution of benefits, including death benefits,
from a contract used in the plan. In particular, a prospective purchaser who
intends to use the contract in connection with a qualified plan should consider
that the contract provides a death benefit (described below) that could be
characterized as an incidental death benefit. There are limits on the amount of
incidental benefits that may be provided under certain qualified plans and the
provision of such benefits may result in currently taxable income to plan
participants (see "FEDERAL TAX MATTERS").

Amount of Death Benefit. If any contract owner dies, the death benefit
will be determined as follows: The death benefit during the first nine contract
years will be the greater of: (a) the contract value less any payments
enhancements applied in the 12 month period prior to the date of death, or (b)
the excess of (i) the sum of all purchase payments less any payment enhancements
applied in the 12 month period prior to the date of death over (ii) the sum of
any amounts deducted in connection with partial withdrawals. After the ninth
contract year, the death benefit will be the greater of: (a) the contract value
less any payment enhancements applied in the 12 month period prior to the date
of death or (b) the excess of (i) the sum of all purchase payments less any
payment enhancements applied in the 12 month period prior to the date of death
over (ii) the sum of any amounts deducted in connection with partial withdrawals
or (c) the death benefit on the last day of the ninth contract year, plus the
sum of all purchase payments made and any amount deducted in connection with
partial withdrawals since then and less any payment enhancements applied in the
12 month period prior to the date of death. Reference to "payment enhancements"
in this paragraph refers to the original amount of payment enhancement credited,
earnings attributable to the payment enhancement will not be deducted from the
death benefit paid.

The determination of the death benefit will be made on the date written
notice and due proof of death, as well as all required claims forms, are
received at the Company's Annuity Service Office. No person is entitled to the
death benefit until this time. In addition, partial withdrawals include amounts
applied under an annuity option under the contract. Also, amounts deducted in
connection with partial withdrawals include charges imposed on a partial
withdrawal, but not amounts charged to the contract in payment of the annual
administration fee. If there is any debt under the contract, the death benefit
equals the death benefit, as described above, less such debt.

Payment of Death Benefit. The Company will pay the death benefit
(which, as defined above, is net of any debt) to the beneficiary if any contract
owner dies before the maturity date. If there is a surviving contract owner,
that contract owner will be deemed to be the beneficiary. No death benefit is
payable on the death of any annuitant, except that if any contract owner is not
a natural person, the death of any annuitant will be treated as the death of an
owner. On the death of the last surviving annuitant, the contract owner, if a
natural person, will become the annuitant unless the contract owner designates
another person as the annuitant.

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<PAGE> 31
The death benefit may be taken in the form of a lump sum immediately.
If not taken immediately, the contract will continue subject to the following:
(1) The beneficiary will become the contract owner. (2) Any excess of the death
benefit over the contract value will be allocated to the owner's investment
accounts in proportion to their relative values on the date of the Company's
receipt at its Annuity Service Office of due proof of the owner's death. (3) No
additional purchase payments may be made. (4) If the beneficiary is not the
deceased owner's spouse, distribution of the contract owner's entire interest in
the contract must be made within five years of the owner's death, or
alternatively, distribution may be made as an annuity, under one of the annuity
options described below, which begins within one year of the owner's death and
is payable over the life of the beneficiary or over a period not extending
beyond the life expectancy of the beneficiary. Upon the death of the
beneficiary, the death benefit will equal the contract value which must be
distributed immediately in a single sum. (5) If the owner's spouse is the
beneficiary, the spouse continues the contract as the new owner. In such a case,
the distribution rules described in "(4)" applicable when a contract owner dies
will apply when the spouse, as the owner, dies. (6) If any contract owner dies
and the oldest owner had an attained age of less than 81 on the contract date,
withdrawal charges are not applied on payment of the death benefit (whether
taken through a partial or total withdrawal or applied under an annuity option).
If any contract owner dies and the oldest owner had an attained age greater than
80 on the contract date, withdrawal charges will be assessed only upon payment
of the death benefit (if such charges are otherwise applicable), so that if the
death benefit is paid in a subsequent year, a lower withdrawal charge will be
applicable.

If any annuitant is changed and any contract owner is not a natural
person, the entire interest in the contract must be distributed to the contract
owner within five years.

A substitution or addition of any contract owner may result in
resetting the death benefit to an amount equal to the contract value as of the
date of the change and treating such value as a payment made on that date for
purposes of computing the amount of the death benefit. This treatment of
contract value as a payment is not included in cumulative purchase payments and
is not eligible for a payment enhancement. No such change in death benefit will
be made if the individual whose death will cause the death benefit to be paid is
the same after the change in ownership or if ownership is transferred to the
owner's spouse.

Death benefits will be paid within seven days of the date the amount of
the death benefit is determined, as described above, subject to postponement
under the same circumstances that payment of withdrawals may be postponed (see
"WITHDRAWALS").

ANNUITY PROVISIONS

GENERAL

The proceeds of the contract payable on death, withdrawal or the
contract maturity date may be applied to the annuity options described below,
subject to the distribution of death benefit provisions (see "DEATH BENEFIT
BEFORE MATURITY DATE").

Generally, annuity benefits under the contract will begin on the
maturity date. The maturity date is the date specified on the contract
specifications page, unless changed. If no date is specified, the maturity date
is the maximum maturity date described below. The maximum maturity date is the
first day of the month following the later of the 85th birthday of the annuitant
or the tenth contract anniversary. See Appendix C for contracts issued in
Pennsylvania. The contract owner may specify a different maturity date at any
time by written request at least one month before both the previously specified
and the new maturity date. The new maturity date may not be later than the
maximum maturity date unless the Company consents. Maturity dates which occur at
advanced ages, e.g., past age 85, may in some circumstances have adverse income
tax consequences (see "FEDERAL TAX MATTERS"). Distributions from qualified
contracts may be required before the maturity date.

The contract owner may select the frequency of annuity payments.
However, if the contract value at the maturity date is such that a monthly
payment would be less than $20, the Company may pay the contract value, less any
debt, in one lump sum to the annuitant on the maturity date.

ANNUITY OPTIONS

Annuity benefits are available under the contract on a fixed or
variable basis, or any combination of fixed and variable bases. Upon purchase of
the contract, and on or before the maturity date, the contract owner may select
one or more of the annuity options

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<PAGE> 32
described below on a fixed and/or variable basis (except Option 5 which is
available on a fixed basis only) or choose an alternate form of settlement
acceptable to the Company. If an annuity option is not selected, the Company
will provide as a default option variable annuity payments in proportion to the
Investment Account Value of each investment option at the maturity date, such
payments to be made for a period certain of 10 years and continuing thereafter
during the lifetime of the annuitant. Treasury Department regulations may
preclude the availability of certain annuity options in connection with certain
qualified contracts.

The following annuity options are guaranteed in the contract.

Option 1(a): Non-Refund Life Annuity - An annuity with payments during
the lifetime of the annuitant. No payments are due after the death of
the annuitant. Since there is no guarantee that any minimum number of
payments will be made, an annuitant may receive only one payment if the
annuitant dies prior to the date the second payment is due.

Option 1(b): Life Annuity with Payments Guaranteed for 10 Years - An
annuity with payments guaranteed for 10 years and continuing thereafter
during the lifetime of the annuitant. Since payments are guaranteed for
10 years, annuity payments will be made to the end of such period if
the annuitant dies prior to the end of the tenth year.

Option 2(a): Joint & Survivor Non-Refund Life Annuity - An annuity with
payments during the lifetimes of the annuitant and a designated
co-annuitant. No payments are due after the death of the last survivor
of the annuitant and co-annuitant. Since there is no guarantee that any
minimum number of payments will be made, an annuitant or co-annuitant
may receive only one payment if the annuitant and co-annuitant die
prior to the date the second payment is due.

Option 2(b): Joint & Survivor Life Annuity with Payments Guaranteed for
10 Years - An annuity with payments guaranteed for 10 years and
continuing thereafter during the lifetimes of the annuitant and a
designated co-annuitant. Since payments are guaranteed for 10 years,
annuity payments will be made to the end of such period if both the
annuitant and the co-annuitant die prior to the end of the tenth year.

In addition to the foregoing annuity options which the Company is
contractually obligated to offer at all times, the Company currently offers the
following annuity options. The Company may cease offering the following annuity
options at any time and may offer other annuity options in the future.

Option 3: Life annuity with Payments Guaranteed for 5, 15 or 20 Years -
An Annuity with payments guaranteed for 5, 15 or 20 years and
continuing thereafter during the lifetime of the annuitant. Since
payments are guaranteed for the specific number of years, annuity
payments will be made to the end of the last year of the 5, 15 or 20
year period.

Option 4: Joint & Two-Thirds Survivor Non-Refund Life Annuity - An
annuity with full payments during the joint lifetime of the annuitant
and a designated co-annuitant and two-thirds payments during the
lifetime of the survivor. Since there is no guarantee that any minimum
number of payments will be made, an annuitant or co-annuitant may
receive only one payment if the annuitant and co-annuitant die prior to
the date the second payment is due.

Option 5: Period Certain Only Annuity for 5, 10, 15 or 20 years - An
annuity with payments for a 5, 10, 15 or 20 year period and no payments
thereafter.

DETERMINATION OF AMOUNT OF THE FIRST VARIABLE ANNUITY PAYMENT

The first variable annuity payment is determined by applying that
portion of the contract value used to purchase a variable annuity, measured as
of a date not more than ten business days prior to the maturity date (minus any
applicable premium taxes), to the annuity tables contained in the contract. (The
amount of the first and all subsequent fixed annuity payments is determined on
the same basis using the portion of the contract value used to purchase a fixed
annuity.) The rates contained in such tables depend upon the annuitant's sex and
age (as adjusted depending on the annuitant's year of birth) and the annuity
option selected, except in contracts issued in connection with certain employer
sponsored plans where sex-based tables may not be used. Under such tables, the
longer the life expectancy of the annuitant under any life annuity option or the
duration of any period for which payments are guaranteed under the option, the
smaller will be the amount of the first monthly variable annuity payment. The
rates are based on the 1983 Table A projected at Scale G, assume births in year
1942 and reflect an assumed interest rate of 3% per year.

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<PAGE> 33
ANNUITY UNITS AND THE DETERMINATION OF SUBSEQUENT VARIABLE ANNUITY PAYMENTS

Variable annuity payments subsequent to the first will be based on the
investment performance of the sub-accounts selected. The amount of such
subsequent payments is determined by dividing the amount of the first annuity
payment from each sub-account by the annuity unit value of such sub-account (as
of the same date the contract value to effect the annuity was determined) to
establish the number of annuity units which will thereafter be used to determine
payments. This number of annuity units for each sub-account is then multiplied
by the appropriate annuity unit value as of a uniformly applied date not more
than ten business days before the annuity payment is due, and the resulting
amounts for each sub-account are then totaled to arrive at the amount of the
payment to be made. The number of annuity units remains constant during the
annuity payment period.

The value of an annuity unit for each sub-account for any valuation
period is determined by multiplying the annuity unit value for the immediately
preceding valuation period by the net investment factor for that sub-account
(see "NET INVESTMENT FACTOR") for the valuation period for which the annuity
unit value is being calculated and by a factor to neutralize the assumed
interest rate.

A 3% assumed interest rate is built into the annuity tables in the
contract used to determine the first variable annuity payment. A higher
assumption would mean a larger first annuity payment, but more slowly rising
subsequent payments when actual investment performance exceeds the assumed rate,
and more rapidly falling subsequent payments when actual investment performance
is less than the assumed rate. A lower assumption would have the opposite
effect. If the actual net investment performance is 3% annually, annuity
payments will be level.

TRANSFERS AFTER MATURITY DATE

Once variable annuity payments have begun, the contract owner may
transfer all or part of the investment upon which such payments are based from
one sub-account to another. Transfers will be made upon notice to the Company at
least 30 days before the due date of the first annuity payment to which the
change will apply. Transfers after the maturity date will be made by converting
the number of annuity units being transferred to the number of annuity units of
the sub-account to which the transfer is made, so that the next annuity payment
if it were made at that time would be the same amount that it would have been
without the transfer. Thereafter, annuity payments will reflect changes in the
value of the new annuity units. The Company reserves the right to limit, upon
notice, the maximum number of transfers a contract owner may make per contract
year to four. Once annuity payments have commenced, no transfers may be made
from a fixed annuity option to a variable annuity option or from a variable
annuity option to a fixed annuity option. In addition, the Company reserves the
right to defer the transfer privilege at any time that the Company is unable to
purchase or redeem shares of the Trust portfolios. The Company also reserves the
right to modify or terminate the transfer privilege at any time in accordance
with applicable law.

DEATH BENEFIT ON OR AFTER MATURITY DATE

If annuity payments have been selected based on an annuity option
providing for payments for a guaranteed period, and the annuitant dies on or
after the maturity date, the Company will make the remaining guaranteed payments
to the beneficiary. Any remaining payments will be made as rapidly as under the
method of distribution being used as of the date of the annuitant's death. If no
beneficiary is living, the Company will commute any unpaid guaranteed payments
to a single sum (on the basis of the interest rate used in determining the
payments) and pay that single sum to the estate of the last to die of the
annuitant and the beneficiary.

OTHER CONTRACT PROVISIONS

TEN DAY RIGHT TO REVIEW

The contract owner may cancel the contract by returning it to the
Company's Annuity Service Office or agent at any time within 10 days after
receipt of the contract. Within 7 days of receipt of the contract by the
Company, the Company will pay the contract value, less any debt and any payment
enhancement, computed at the end of the valuation period during which the
contract is received by the Company, to the contract owner. The Company will
recover the original amount of the payment enhancement credited, earnings
attributable to the payment enhancement will not be deducted from the amount
paid.

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<PAGE> 34

No withdrawal charge is imposed upon return of the contract within the
ten day right to review period. The ten day right to review may vary in certain
states in order to comply with the requirements of insurance laws and
regulations in such states. When the contract is issued as an individual
retirement annuity under Sections 408 or 408A of the Code, during the first 7
days of the 10 day period, the Company will return all purchase payments if this
is greater than the amount otherwise payable.

OWNERSHIP

The contract owner is the person entitled to exercise all rights under
the contract. Prior to the maturity date, the contract owner is the person
designated in the contract specifications page or as subsequently named. On and
after the maturity date, the annuitant is the contract owner. If amounts become
payable to any beneficiary under the contract, the beneficiary is the contract
owner.

In the case of non-qualified contracts, ownership of the contract may
be changed or the contract may be collaterally assigned at any time prior to the
maturity date, subject to the rights of any irrevocable beneficiary. Assigning a
contract, or changing the ownership of a contract, may be treated as a
distribution of the contract value for Federal tax purposes (see "FEDERAL TAX
MATTERS"). A change of any contract owner may result in resetting the death
benefit to an amount equal to the contract value as of the date of the change
and treating such value as a purchase payment made on that date for purposes of
computing the amount of the death benefit. This purchase payment will not be
included in cumulative purchase payments and is not eligible for a payment
enhancement (see "DEATH BENEFIT BEFORE MATURITY DATE").

Any change of ownership or assignment must be made in writing. Any
change must be approved by the Company. Any assignment and any change, if
approved, will be effective as of the date the Company receives the request at
its Annuity Service Office. The Company assumes no liability for any payments
made or actions taken before a change is approved or an assignment is accepted
or responsibility for the validity or sufficiency of any assignment. An absolute
assignment will revoke the interest of any revocable beneficiary.

In the case of qualified contracts, ownership of the contract generally
may not be transferred except by the trustee of an exempt employees' trust which
is part of a retirement plan qualified under Section 401 of the Code or as
otherwise permitted by applicable Internal Revenue Service ("IRS") regulations.
Subject to the foregoing, a qualified contract may not be sold, assigned,
transferred, discounted or pledged as collateral for a loan or as security for
the performance of an obligation or for any other purpose to any person other
than the Company.

ANNUITANT

The annuitant is any natural person or persons whose life is used to
determine the duration of annuity payments involving life contingencies. If the
contract owner names more than one person as an "annuitant," the second person
named shall be referred to as "co-annuitant." The annuitant is as designated on
the contract specifications page or in the application, unless changed.

On the death of the annuitant, the co-annuitant, if living, becomes the
annuitant. If there is no living co-annuitant, the owner becomes the annuitant.
In the case of certain qualified contracts, there are limitations on the ability
to designate and change the annuitant and the co-annuitant.

BENEFICIARY

The beneficiary is the person, persons or entity designated in the
contract specifications page or as subsequently named. However, if there is a
surviving contract owner, that person will be treated as the beneficiary. The
beneficiary may be changed subject to the rights of any irrevocable beneficiary.
Any change must be made in writing, approved by the Company and if approved,
will be effective as of the date on which written. The Company assumes no
liability for any payments made or actions taken before the change is approved.
If no beneficiary is living, the contingent beneficiary will be the beneficiary.
The interest of any beneficiary is subject to that of any assignee. If no
beneficiary or contingent beneficiary is living, the beneficiary is the estate
of the deceased contract owner. In the case of certain qualified contracts,
regulations promulgated by the Treasury Department prescribe certain limitations
on the designation of a beneficiary.

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MODIFICATION

The contract may not be modified by the Company without the consent of
the contract owner, except as may be required to make it conform to any law or
regulation or ruling issued by a governmental agency. The provisions of the
contract shall be interpreted so as to comply with the requirements of Section
72(s) of the Code.

COMPANY APPROVAL

The Company reserves the right to accept or reject any contract
application at its sole discretion.

MISSTATEMENT AND PROOF OF AGE, SEX OR SURVIVAL

The Company may require proof of age, sex or survival of any person
upon whose age, sex or survival any payment depends. If the age or sex of the
annuitant has been misstated, the benefits will be those that would have been
provided for the annuitant's correct age and sex. If the Company has made
incorrect annuity payments, the amount of any underpayment will be paid
immediately and the amount of any overpayment will be deducted from future
annuity payments.

FIXED ACCOUNT INVESTMENT OPTIONS

Securities Registration. Due to certain exemptive and exclusionary
provisions, interests in the fixed account investment options are not registered
under the Securities Act of 1933, as amended, (the "1933 Act") and the Company's
general account is not registered as an investment company under the 1940 Act.
Accordingly, neither interests in the fixed account investment options nor the
general account are subject to the provisions or restrictions of the 1933 Act or
the 1940 Act and the staff of the SEC has not reviewed the disclosures in the
Prospectus relating thereto. Disclosures relating to interests in the fixed
account investment options and the general account, however, may be subject to
certain generally applicable provisions of the Federal securities laws relating
to the accuracy of statements made in a registration statement.

Guarantee. Pursuant to a Guarantee Agreement dated March 31, 1996,
Manulife, the ultimate parent of the Company, unconditionally guarantees to the
Company on behalf of and for the benefit of the Company and owners of fixed
annuity contracts issued by the Company that it will, on demand, make funds
available to the Company for the timely payment of contractual claims under
fixed annuity contracts issued after June 27, 1984. This Guarantee covers the
fixed portion of the contracts described in this Prospectus. This Guarantee may
be terminated by Manulife on notice to the Company. Termination will not affect
Manulife's continuing liability with respect to all fixed annuity contracts
issued prior to the termination of the Guarantee except if: (i) the liability to
pay contractual claims under the contracts is assumed by another insurer or (ii)
the Company is sold and the buyer's guarantee is substituted for the Manulife
guarantee.

Reinsurance. Effective June 30, 1995, the Company entered into a
Reinsurance Agreement with Peoples Security Life Insurance Company ("Peoples")
pursuant to which Peoples reinsures certain amounts with respect to the fixed
account portion of the contract described in this Prospectus. Under this
Reinsurance Agreement, the Company remains liable for the contractual
obligations of the contracts' fixed accounts and Peoples agrees to reimburse the
Company for certain amounts and obligations in connection with the fixed
accounts. Peoples contractual liability runs solely to the Company, and no
contract owner shall have any right of action against Peoples. Peoples is a
wholly-owned subsidiary of Louisville, Kentucky based Providian Corporation, a
diversified financial services corporation.

Investment Options. A one year fixed account investment option is
available under the contract. In addition, a one year DCA fixed investment
account may be established under the DCA program to make automatic monthly
transfers from a one year fixed account to one or more variable investment
options (see "SPECIAL TRANSFER SERVICES-DOLLAR COST AVERAGING" for details).
Under a fixed account investment option, the Company guarantees the principal
value of purchase payments and the rate of interest credited to the investment
account for the term of the guarantee period. The portion of the contract value
in a fixed account investment option and monthly annuity payments if selected on
a fixed basis, will reflect such interest and principal guarantees. The
guaranteed interest rates on new amounts allocated or transferred to a fixed
investment account are determined from time-to-time by the Company in accordance
with market conditions. In no event will the guaranteed rate of interest be less
than 3%. Once an interest rate is guaranteed for a fixed investment account, it
is guaranteed for the duration of the guarantee period and may not be changed by
the Company.

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<PAGE> 36

Investment Accounts. Contract owners may allocate purchase payments, or
make transfers from the variable investment options, to the one year fixed
account investment option at any time prior to the maturity date. The Company
establishes a separate investment account each time the contract owner allocates
or transfers amounts to the one year fixed account investment option. Amounts
may not be allocated to a fixed account investment option that would extend the
guarantee period beyond the maturity date.

Renewals. At the end of a guarantee period, the contract owner may
establish a new investment account with a one year guarantee period at the then
current interest rate or transfer the amounts to a variable account investment
option, all without the imposition of any charge. In the case of renewals within
one year of the maturity date, the only fixed account investment option
available is to have interest accrued up to the maturity date at the then
current interest rate for one year guarantee periods.

If the contract owner does not specify the renewal option desired, the
Company will select the one year fixed account investment option. In the case of
a renewal within one year of the maturity date, the Company will credit interest
up to the maturity date at the then current interest rate for one year guarantee
periods.

Transfers. Prior to the maturity date, the contract owner may transfer
amounts from the fixed account investment option to the variable account
investment options at the end of the guaranteed period; however, amounts may be
transferred prior to the end of the guarantee period pursuant to the Dollar Cost
Averaging program.

Where there are multiple investment accounts within the one year fixed
account investment option, amounts must be transferred from the one year fixed
account investment option on a first-in-first-out basis.

Withdrawals. The contract owner may make total and partial withdrawals
of amounts held in the fixed account investment options at any time prior to the
maturity date or his or her death. Withdrawals from the fixed account investment
options will be made in the same manner and be subject to the same limitations
as set forth under "WITHDRAWALS" plus the following provisions also apply to
withdrawals from the fixed account investment options: (1) the Company reserves
the right to defer payment of amounts withdrawn from the fixed account
investment options for up to six months from the date it receives the written
withdrawal request (if a withdrawal is deferred for more than 30 days pursuant
to this right, the Company will pay interest on the amount deferred at a rate
not less than 3% per year (or such higher rate as may be required by the
applicable state or jurisdiction)); and (2) if there are multiple investment
accounts under the fixed account investment options, amounts must be withdrawn
from such accounts on a first-in-first-out basis.

If the contract owner does not specify the investment options from
which a partial withdrawal is to be taken, a partial withdrawal will be taken
from the variable account investment options until exhausted and then from the
fixed account investment options.

Such withdrawal will be made from the investment options beginning with
the shortest guarantee period. Within such sequence, where there are multiple
investment accounts within a fixed account investment option, withdrawals will
be made on a first-in-first-out basis. For this purpose, the one year DCA fixed
account investment option is considered to have a shorter guarantee period than
the one year fixed account investment option.

Loans. The Company offers a loan privilege only to owners of contracts
issued in connection with Section 403(b) qualified plans that are not subject to
Title I of ERISA. Owners of such contracts may obtain loans using the contract
as the only security for the loan. Owners of such contracts may borrow amounts
allocated to the fixed investment account in the same manner and subject to the
same limitations as set forth under "LOANS" above.

Fixed Annuity Options. Subject to the distribution of death benefits
provisions (see "DEATH BENEFIT BEFORE MATURITY DATE" above), on death,
withdrawal or the maturity date of the contract, the proceeds may be applied to
a fixed annuity option (see "ANNUITY OPTIONS" above). The amount of each fixed
annuity payment is determined by applying the portion of the proceeds (less any
applicable premium taxes) applied to purchase the fixed annuity to the
appropriate table in the contract. If the table in use by the

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<PAGE> 37
Company is more favorable to the contract owner, the Company will substitute
that table. The Company guarantees the dollar amount of fixed annuity payments.

CHARGES AND DEDUCTIONS

Charges and deductions under the contracts are assessed against
purchase payments, contract values or annuity payments. Currently, there are no
deductions made from purchase payments, except for premium taxes in certain
states. In addition, there are deductions from and expenses paid out of the
assets of the Trust portfolios that are described in the accompanying Prospectus
of the Trust.

WITHDRAWAL CHARGES

If a withdrawal is made from the contract before the maturity date, a
withdrawal charge (contingent deferred sales charge) may be assessed against
amounts withdrawn attributable to purchase payments that have been in the
contract less than ten complete contract years. There is never a withdrawal
charge with respect to earnings accumulated in the contract, certain other free
withdrawal amounts described below or purchase payments that have been in the
contract more than ten complete contract years. In no event may the total
withdrawal charges exceed 8.5% of the amount invested. The amount of the
withdrawal charge and when it is assessed are discussed below:

1. Each withdrawal from the contract is allocated first to the "free
withdrawal amount" and second to "unliquidated purchase payments." In any
contract year, the free withdrawal amount for that year is the greater of (1)
the excess of the contract value on the date of withdrawal over the unliquidated
purchase payments (the accumulated earnings on the contract) or (2) the excess
of (i) over (ii), where (i) is 10% of total purchase payments and (ii) is all
prior partial withdrawals in that contract year. Withdrawals allocated to the
free withdrawal amount may be withdrawn without the imposition of a withdrawal
charge. The free withdrawal amount will be applied to a requested withdrawal,
first, to withdrawals from variable account investment options and then to
withdrawals from the one year fixed account investment option.

2. If a withdrawal is made for an amount in excess of the free
withdrawal amount, the excess will be allocated to purchase payments which will
be liquidated on a first-in first-out basis. On any withdrawal request, the
Company will liquidate purchase payments equal to the amount of the withdrawal
request which exceeds the free withdrawal amount in the order such purchase
payments were made: the oldest unliquidated purchase payment first, the next
purchase payment second, etc. until all purchase payments have been liquidated.

3. Each purchase payment (or portion thereof) liquidated in connection
with a withdrawal request is subject to a withdrawal charge based on the length
of time the purchase payment has been in the contract. The amount of the
withdrawal charge is calculated by multiplying the amount of the purchase
payment being liquidated by the applicable withdrawal charge percentage obtained
from the table below.

<TABLE>
<CAPTION>
NUMBER OF COMPLETE YEARS
PURCHASE PAYMENT IN CONTRACT WITHDRAWAL CHARGE PERCENTAGE
<S> <C>
0 8.5%
1 8.5%
2 8.0%
3 7.0%
4 6.0%
5 5.0%
6 4.0%
7 3.0%
8 2.0%
9 0.0%
</TABLE>

The total withdrawal charge will be the sum of the withdrawal charges
for the purchase payments being liquidated.

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4. The withdrawal charge is deducted from the contract value remaining
after the contract owner is paid the amount requested, except in the case of a
complete withdrawal when it is deducted from the amount otherwise payable. In
the case of a partial withdrawal, the amount requested from an investment
account may not exceed the value of that investment account less any applicable
withdrawal charge.

5. There is generally no withdrawal charge on distributions made as a
result of the death of the contract owner or, if applicable, the annuitant (see
"DEATH BENEFIT BEFORE MATURITY DATE -- Amount of Death Benefit"), and no
withdrawal charges are imposed on the maturity date if the contract owner
annuitizes as provided in the contract.

The amount collected from the withdrawal charge will be used to
reimburse the Company for the compensation paid to cover selling concessions to
broker-dealers, preparation of sales literature and other expenses related to
sales activity.

For examples of calculation of the withdrawal charge, see Appendix A.

REDUCTION OR ELIMINATION OF WITHDRAWAL CHARGES

The amount of the withdrawal charge on a contract may be reduced or
eliminated when sales of the contracts are made to individuals or to a group of
individuals in such a manner that results in savings of sales expenses. The
entitlement to such a reduction in the withdrawal charge will be determined by
the Company in the following manner:

1. The size and type of group to which sales are to be made will be
considered. Generally, sales expenses for a larger group are smaller than for a
smaller group because of the ability to implement large numbers of contracts
with fewer sales contacts.

2. The total amount of purchase payments to be received will be
considered. Per dollar sales expenses are likely to be less on larger purchase
payments than on smaller ones.

3. Any prior or existing relationship with the Company will be
considered. Per contract sales expenses are likely to be less when there is a
prior or existing relationship because of the likelihood of implementing the
contract with fewer sales contacts.

4. The level of commissions paid to selling broker-dealers will be
considered. Certain broker-dealers may offer the contract in connection with
financial planning programs offered on a fee for service basis. In view of the
financial planning fees, such broker-dealers may elect to receive lower
commissions for sales of the contracts, thereby reducing the Company's sales
expenses.

5. There may be other circumstances of which the Company is not
presently aware, which could result in reduced sales expenses.

If, after consideration of the foregoing factors, it is determined that
there will be a reduction in sales expenses, the Company will provide a
reduction in the withdrawal charge. In no event will reduction or elimination of
the withdrawal charge be permitted where such reduction or elimination will be
unfairly discriminatory to any person.

The Clinton administration's Fiscal Year 1999 Budget proposal dated
February 2, 1998 (the "1999 Budget Proposal") contains proposals to change the
taxation of non-qualified annuity contracts (see "FEDERAL TAX MATTERS -
Introduction"). While it is uncertain whether the 1999 Budget Proposal will
become law, if the 1999 Budget Proposal is enacted substantially as proposed,
withdrawal charges will be waived on purchase payments made on or after February
2, 1998, provided such amounts are withdrawn within 60 days of the date that the
1999 Budget Proposal becomes law. The Company reserves the right to terminate
this withdrawal charge waiver at any time. If the waiver is terminated, purchase
payments made from February 2, 1998 to the termination date of the waiver will
not be subject to withdrawal charge as provided above. This waiver does not
affect a contract owner's right to cancel a contract within the ten day right to
review period (see "OTHER CONTRACT PROVISIONS - Ten Day Right to Review").
Withdrawals may be subject to income tax to the extent of earnings under the
contract and, if made prior to age 59-1/2, generally will be subject to a 10%
IRS penalty tax (see "FEDERAL TAX MATTERS - Taxation of Partial and Full
Withdrawals").

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ADMINISTRATION FEES

Except as noted below, the Company will deduct each year an annual
administration fee of $40 as partial compensation for the cost of providing all
administrative services attributable to the contracts and the operations of the
Variable Account and the Company in connection with the contracts. However, if
prior to the maturity date the contract value is equal to or greater than
$100,000 at the time of the fee's assessment, the fee will be waived. Prior to
the maturity date, this administration fee is deducted on the last day of each
contract year. It is withdrawn from each investment option in the same
proportion that the value of such investment option bears to the contract value.
If the entire contract is withdrawn on other than the last day of any contract
year, the $40 administration fee will be deducted from the amount paid. During
the annuity period, the fee is deducted on a pro-rata basis from each annuity
payment.

A daily fee in an amount equal to 0.30% of the value of each variable
investment account on an annual basis is deducted from each sub-account as an
administration fee. The fee is designed to compensate the Company for the cost
of providing administrative services attributable to the contracts and the
operations of the Variable Account and the Company in connection with the
contracts. This asset based administration fee will not be deducted from the
fixed account investment option. The fee will be reflected in the contract value
as a proportionate reduction in the value of each investment account. Because
the administration fee is a percentage of assets rather than a flat amount,
larger contracts will in effect pay a higher proportion of the administrative
expenses than smaller contracts.

The Company does not expect to recover from such fees any amount in
excess of its accumulated administrative expenses. Even though administrative
expenses may increase, the Company guarantees that it will not increase the
amount of the administration fees.

MORTALITY AND EXPENSE RISK CHARGE

The mortality risk assumed by the Company is the risk that annuitants
may live for a longer period of time than estimated. The Company assumes this
mortality risk by virtue of annuity rates incorporated into the contract which
cannot be changed. This assures each annuitant that his longevity will not have
an adverse effect on the amount of annuity payments. Also, the Company
guarantees that if the contract owner dies before the maturity date, it will pay
a death benefit (see "DEATH BENEFIT BEFORE MATURITY DATE"). The expense risk
assumed by the Company is the risk that the administration charges or withdrawal
charge may be insufficient to cover actual expenses.

To compensate it for assuming these risks, the Company deducts from
each of the sub-accounts a daily charge in an amount equal to 1.25% of the value
of the variable investment accounts on an annual basis, consisting of 0.80% for
the mortality risk and 0.45% for the expense risk. The charge will be reflected
in the contract value as a proportionate reduction in the value of each
investment account. The rate of the mortality and expense risk charge cannot be
increased. If the charge is insufficient to cover the actual cost of the
mortality and expense risks undertaken, the Company will bear the loss.
Conversely, if the charge proves more than sufficient, the excess will be profit
to the Company and will be available for any proper corporate purpose including,
among other things, payment of distribution expenses. The mortality and expense
risk charge is not assessed against the fixed account investment option.

TAXES

The Company reserves the right to charge, or provide for, certain taxes
against purchase payments, contract values or annuity payments. Such taxes may
include premium taxes or other taxes levied by any government entity which the
Company determines to have resulted from the (i) establishment or maintenance of
the Variable Account, (ii) receipt by the Company of purchase payments, (iii)
issuance of the contacts, or (iv) commencement or continuance of annuity
payments under the contracts. In addition, the Company will withhold taxes to
the extent required by applicable law.

Except for residents of those states which apply premium taxes upon
receipt of purchase payments, premium taxes will be deducted from the contract
value used to provide for fixed or variable annuity payments. For residents of
those states which apply premium taxes upon receipt of purchase payments,
premium taxes will be deducted upon payment of any withdrawal benefits, upon any
annuitization, or payment of death benefits. The amount deducted will depend on
the premium tax assessed in the applicable state. State premium taxes currently
range from 0% to 3.5% depending on the jurisdiction and the tax

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status of the contract and are subject to change by the legislature or other
authority (see "APPENDIX B: STATE PREMIUM TAXES").

FEDERAL TAX MATTERS

INTRODUCTION

The following discussion of the Federal income tax treatment of the
contract is not exhaustive, does not purport to cover all situations, and is not
intended as tax advice. A qualified tax advisor should always be consulted with
regard to the application of law to individual circumstances. This discussion is
based on the Code, Treasury Department regulations, and interpretations existing
on the date of this Prospectus. These authorities, however, are subject to
change by Congress, the Treasury Department, and judicial decisions.

The 1999 Budget Proposal contains proposals to change the taxation of
non-qualified annuity contracts. The 1999 Budget Proposal proposes to tax
exchanges of variable contracts for fixed contracts, exchanges of fixed
contracts for variable contracts, exchanges of variable contracts for variable
contracts and reallocation within variable contracts. Currently, owners of
annuity contracts may exchange their contracts for another annuity without
currently incurring tax, and reallocations among investment options are not
treated as a taxable exchange. In addition, the 1999 Budget Proposal proposes
that the contract owner's basis in annuity contracts be reduced annually by
1.25% of the cash value for purposes of determining the taxable gain on
surrenders, withdrawals, and all annuity payments except those made for life at
the rates guaranteed in the contract. Currently, basis in annuity contracts is
not reduced by this amount. The 1999 Budget Proposal states that it generally
would apply only to contracts issued after the date of first congressional
committee action, but that the new exchange and reallocation rules would also
apply to any existing contract that was materially changed. While it is
uncertain whether the 1999 Budget Proposal will become law, if the 1999 Budget
Proposal is enacted substantially as proposed, withdrawal charges will be waived
(see "CHARGES AND DEDUCTIONS -- Reduction or Elimination of Withdrawal Charge").

This discussion does not address state or local tax consequences
associated with the purchase of a contract. THE COMPANY MAKES NO GUARANTEE
REGARDING ANY TAX TREATMENT -- FEDERAL, STATE OR LOCAL -- OF ANY CONTRACT OR OF
ANY TRANSACTION INVOLVING A CONTRACT.

THE COMPANY'S TAX STATUS

The Company is taxed as a life insurance company under the Code. Since
the operations of the Variable Account are a part of, and are taxed with, the
operations of the Company, the Variable Account is not separately taxed as a
"regulated investment company" under the Code. Under existing Federal income tax
laws, investment income and capital gains of the Variable Account are not taxed
to the extent they are applied under a contract. The Company does not anticipate
that it will incur any Federal income tax liability attributable to such income
and gains of the Variable Account, and therefore the Company does not intend to
make provision for any such taxes. If the Company is taxed on investment income
or capital gains of the Variable Account, then the Company may impose a charge
against the Variable Account in order to make provision for such taxes.

TAXATION OF ANNUITIES IN GENERAL

TAX DEFERRAL DURING ACCUMULATION PERIOD

Under existing provisions of the Code, except as described below, any
increase in the contract value is generally not taxable to the contract owner or
annuitant until received, either in the form of annuity payments, as
contemplated by the contract, or in some other form of distribution. However,
certain requirements must be satisfied in order for this general rule to apply,
including: (1) the contract must be owned by an individual (or treated as owned
by an individual), (2) the investments of the Variable Account must be
"adequately diversified" in accordance with Treasury Department regulations, (3)
the Company, rather than the owner, must be considered the owner of the assets
of the Variable Account for Federal tax purposes, and (4) the contract must
provide for appropriate amortization, through annuity payments, of the
contract's purchase payments and earnings, e.g., the maturity date must not
occur at too advanced an age.

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Non-Natural Owners. As a general rule, deferred annuity contracts held
by "non-natural persons" such as a corporation, trust or other similar entity,
as opposed to a natural person, are not treated as annuity contracts for Federal
income tax purposes. The investment income on such contracts is taxed as
ordinary income that is received or accrued by the owner of the contract during
the taxable year. There are several exceptions to this general rule for
non-natural contract owners. First, contracts will generally be treated as held
by a natural person if the nominal owner is a trust or other entity which holds
the contract as an agent for a natural person. However, this special exception
will not apply in the case of any employer who is the nominal owner of an
annuity contract under a non-qualified deferred compensation arrangement for its
employees.

In addition, exceptions to the general rule for non-natural contract
owners will apply with respect to (1) contracts acquired by an estate of a
decedent by reason of the death of the decedent, (2) certain qualified
contracts, (3) certain contracts purchased by employers upon the termination of
certain qualified plans, (4) certain contracts used in connection with
structured settlement agreements, and (5) contracts purchased with a single
premium when the annuity starting date (as defined in the tax law) is no later
than a year from purchase of the annuity and substantially equal periodic
payments are made, not less frequently than annually, during the annuity period.

Loss of Interest Deduction Where Contracts are Held by or for the
Benefit of Certain Non-Natural Persons. In the case of contracts issued after
June 8, 1997 to a non-natural taxpayer (such as corporation or a trust), or held
for the benefit of such an entity, recent changes in the tax law may result in
otherwise deductible interest no longer being deductible by the entity,
regardless of whether the interest relates to debt used to purchase or carry the
contract. However, this interest deduction disallowance does not affect
contracts where the income on such contracts is treated as ordinary income that
is received or accrued by the owner during the taxable year. Entities that are
considering purchasing the contract, or entities that will be beneficiaries
under a contract, should consult a tax advisor.

Diversification Requirements. For a contract to be treated as an
annuity for Federal income tax purposes, the investments of the Variable Account
must be "adequately diversified" in accordance with Treasury Department
Regulations. The Secretary of the Treasury has issued regulations which
prescribe standards for determining whether the investments of the Variable
Account are "adequately diversified." If the Variable Account failed to comply
with these diversification standards, a contract would not be treated as an
annuity contract for Federal income tax purposes and the contract owner would
generally be taxable currently on the excess of the contract value over the
premiums paid for the contract.

Although the Company does not control the investments of the Trust, it
expects that the Trust will comply with such regulations so that the Variable
Account will be considered "adequately diversified."

Ownership Treatment. In certain circumstances, a variable annuity
contract owner may be considered the owner, for Federal income tax purposes, of
the assets of the separate account used to support his or her contract. In those
circumstances, income and gains from such separate account assets would be
includible in the contract owner's gross income. The Internal Revenue Service
(the "Service") has stated in published rulings that a variable contract owner
will be considered the owner of separate account assets if the owner possesses
incidents of ownership in those assets, such as the ability to exercise
investment control over the assets. In addition, the Treasury Department
announced, in connection with the issuance of regulations concerning investment
diversification, that those regulations "do not provide guidance concerning the
circumstances in which investor control of the investments of a segregated asset
account may cause the investor, rather than the insurance company, to be treated
as the owner of the assets in the account." This announcement also stated that
guidance would be issued by way of regulations or rulings on the "extent to
which policyholders may direct their investments to particular sub-accounts [of
a separate account] without being treated as owners of the underlying assets."
As of the date of this Prospectus, no such guidance has been issued.

The ownership rights under this contract are similar to, but different
in certain respects from, those described by the Service in rulings in which it
was determined that contract owners were not owners of separate account assets.
For example, the owner of this contract has the choice of many more investment
options to which to allocate premiums and contract values, and may be able to
transfer among investment options more frequently than in such rulings. These
differences could result in the contract owner being treated as the owner of the
assets of the Variable Account and thus subject to current taxation on the
income and gains from those assets. In addition, the Company does not know what
standards will be set forth in the regulations or rulings which the Treasury
Department has stated it expects to issue. The Company therefore reserves the
right to modify the contract as necessary to attempt to prevent the contract
owner from being considered the owner of the assets of the Variable Account.

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<PAGE> 42

Delayed Maturity Dates. If the contract's maturity date occurs (or is
scheduled to occur) at a time when the annuitant has reached an advanced age,
e.g., past age 85, it is possible that the contract would not be treated as an
annuity for Federal income tax purposes. In that event, the income and gains
under the contract could be currently includible in the owner's income.

The remainder of this discussion assumes that the contract will be
treated as an annuity contract for Federal income tax purposes and that the
Company will be treated as the owner of the Variable Account assets.

TAXATION OF PARTIAL AND FULL WITHDRAWALS

In the case of a partial withdrawal, amounts received are includible in
income to the extent the contract value before the withdrawal exceeds the
"investment in the contract." In the case of a full withdrawal, amounts received
are includible in income to the extent they exceed the "investment in the
contract." For these purposes the investment in the contract at any time equals
the total of the purchase payments made under the contract to that time (to the
extent such payments were neither deductible when made nor excludible from
income as, for example, in the case of certain employer contributions to
qualified plans) less any amounts previously received from the contract which
were not included in income. In this regard, the payment enhancements provided
under a contract are not treated as purchase payments and thus do not increase
the investment in the contract.

Other than in the case of certain qualified contracts, any amount
received as a loan under a contract, and any assignment or pledge (or agreement
to assign or pledge) any portion of the contract value, is treated as a
withdrawal of such amount or portion. (Loans, assignments and pledges are
permitted only in limited circumstances under qualified contracts.) The
investment in the contract is increased by the amount includible in income with
respect to such assignment or pledge, though it is not affected by any other
aspect of the assignment or pledge (including its release). If an individual
transfers his or her interest in an annuity contract without adequate
consideration to a person other than the owner's spouse (or to a former spouse
incident to divorce), the owner will be taxed on the difference between the
"contract value" and the "investment in the contract" at the time of transfer.
In such case, the transferee's investment in the contract will be increased to
reflect the increase in the transferor's income.

The contract provides a death benefit that in certain circumstances may
exceed the greater of the purchase payments and the contract value. As described
elsewhere in this Prospectus, the Company imposes certain charges with respect
to the death benefit. It is possible that those charges (or some portion
thereof) could be treated for Federal income tax purposes as a partial
withdrawal from the contract.

There may be special income tax issues present in situations where the
owner and the annuitant are not the same person and are not married to one
another. A tax advisor should be consulted in those situations.

TAXATION OF ANNUITY PAYMENTS

Normally, the portion of each annuity payment taxable as ordinary
income is equal to the excess of the payment over the exclusion amount. In the
case of variable annuity payments, the exclusion amount is the "investment in
the contract" (defined above) allocated to the variable annuity option, adjusted
for any period certain or refund feature, when payments begin to be made divided
by the number of payments expected to be made (determined by Treasury Department
regulations which take into account the annuitant's life expectancy and the form
of annuity benefit selected). In the case of fixed annuity payments, the
exclusion amount is the amount determined by multiplying (1) the payment by (2)
the ratio of the investment in the contract allocated to the fixed annuity
option, adjusted for any period certain or refund feature, to the total expected
value of annuity payments for the term of the contract (determined under
Treasury Department regulations). A simplified method of determining the taxable
portion of annuity payments applies to contracts issued in connection with
certain qualified plans other than IRAs.

Once the total amount of the investment in the contract is excluded
using these ratios, annuity payments will be fully taxable. If annuity payments
cease because of the death of the annuitant and before the total amount of the
investment in the contract is recovered, the unrecovered amount generally will
be allowed as a deduction to the annuitant in his or her last taxable year.

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TAXATION OF DEATH BENEFIT PROCEEDS

Amounts may be distributed from a contract because of the death of an
owner or the annuitant. Prior to the maturity date, such death benefit proceeds
are includible in income as follows: (1) if distributed in a lump sum, they are
taxed in the same manner as a full withdrawal, as described above, or (2) if
distributed under an annuity option, they are taxed in the same manner as
annuity payments, as described above. After the maturity date, where a
guaranteed period exists under an annuity option and the annuitant dies before
the end of that period, payments made to the beneficiary for the remainder of
that period are includible in income as follows: (1) if received in a lump sum,
they are includible in income to the extent that they exceed the unrecovered
investment in the contract at that time, or (2) if distributed in accordance
with the existing annuity option selected, they are fully excludable from income
until the remaining investment in the contract is deemed to be recovered, and
all annuity payments thereafter are fully includible in income.

PENALTY TAX ON PREMATURE DISTRIBUTIONS

There is a 10% penalty tax on the taxable amount of any payment from a
non-qualified contract unless the payment is: (a) received on or after the
contract owner reaches age 59 1/2; (b) attributable to the contract owner's
becoming disabled (as defined in the tax law); (c) made to a beneficiary on or
after the death of the contract owner or, if the contract owner is not an
individual, on or after the death of the primary annuitant (as defined in the
tax law); (d) made as a series of substantially equal periodic payments (not
less frequently than annually) for the life (or life expectancy) of the
annuitant or for the joint lives (or joint life expectancies) of the annuitant
and designated beneficiary (as defined in the tax law); (e) made under an
annuity contract purchased with a single premium when the annuity starting date
(as defined in the tax law) is no later than a year from purchase of the annuity
and substantially equal periodic payments are made, not less frequently than
annually, during the annuity period; or (f) made with respect to certain
annuities issued in connection with structured settlement agreements. (A similar
penalty tax, applicable to distributions from certain qualified contracts, is
discussed below.)

AGGREGATION OF CONTRACTS

In certain circumstances, the amount of an annuity payment or a
withdrawal from a contract that is includible in income may be determined by
combining some or all of the non-qualified contracts owned by an individual. For
example, if a person purchases a contract offered by this Prospectus and also
purchases at approximately the same time an immediate annuity, the Service may
treat the two contracts as one contract. In addition, if a person purchases two
or more deferred annuity contracts from the same insurance company (or its
affiliates) during any calendar year, all such contracts will be treated as one
contract. The effects of such aggregation are not clear; however, it could
affect the amount of a withdrawal or an annuity payment that is taxable and the
amount which might be subject to the penalty tax described above.

QUALIFIED RETIREMENT PLANS

The contracts are also designed for use in connection with certain
types of retirement plans which receive favorable treatment under the Code.
Numerous special tax rules apply to the participants in such qualified plans and
to the contracts used in connection with such qualified plans. Therefore, no
attempt is made in this Prospectus to provide more than general information
about use of the contract with the various types of qualified plans.

The tax rules applicable to qualified plans vary according to the type
of plan and the terms and conditions of the plan itself. For example, for both
withdrawals and annuity payments under certain qualified contracts, there may be
no "investment in the contract" and the total amount received may be taxable.
Also, loans from qualified contracts, where allowed, are subject to a variety of
limitations, including restrictions as to the amount that may be borrowed, the
duration of the loan, and the manner in which the loan must be repaid. (Owners
should always consult their tax advisors and retirement plan fiduciaries prior
to exercising their loan privileges.) Both the amount of the contribution that
may be made, and the tax deduction or exclusion that the owner may claim for
such contribution, are limited under qualified plans. Those who are considering
the purchase of a contract in connection with a qualified plan should consider,
in evaluating the suitability of the contract, that the contract requires a
minimum initial purchase payment of $10,000. If this contract is used in
connection with a qualified plan, the owner and annuitant must be the same
individual. If a co-annuitant is named, all distributions made while the
annuitant is alive must be made to the annuitant. Also, if a co-annuitant is
named who is not the annuitant's spouse, the annuity options which are available
may be limited, depending on the

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difference in ages between the annuitant and co-annuitant. Furthermore, the
length of any guarantee period may be limited in some circumstances to satisfy
certain minimum distribution requirements under the Code.

In addition, special rules apply to the time at which distributions
must commence and the form in which the distributions must be paid. For example,
failure to comply with minimum distribution requirements applicable to qualified
plans will result in the imposition of an excise tax. This excise tax generally
equals 50% of the amount by which a minimum required distribution exceeds the
actual distribution from the qualified plan. In the case of IRAs, distributions
of minimum amounts (as specified in the tax law) must generally commence by
April 1 of the calendar year following the calendar year in which the owner
attains age 70 1/2. In the case of certain other qualified plans, distributions
of such minimum amounts must generally commence by the later of this date or
April 1 of the calendar year following the calendar year in which the employee
retires.

There is also a 10% penalty tax on the taxable amount of any payment
from certain qualified contracts (but not Section 457 plans). (The amount of the
penalty tax is 25% of the taxable amount of any payment received from a "SIMPLE
retirement account" during the 2 year period beginning on the date the
individual first participated in any qualified salary reduction arrangement (as
defined in the tax law) maintained by the individual's employer.) There are
exceptions to this penalty tax which vary depending on the type of qualified
plan. In the case of an "Individual Retirement Annuity" or an "IRA", including a
"SIMPLE IRA," exceptions provide that the penalty tax does not apply to a
payment (a) received on or after the contract owner reaches age 59 1/2, (b)
received on or after the owner's death or because of the owner's disability (as
defined in the tax law), or (c) made as a series of substantially equal periodic
payments (not less frequently than annually) for the life (or life expectancy)
of the owner or for the joint lives (or joint life expectancies) of the owner
and designated beneficiary (as defined in the tax law). These exceptions, as
well as certain others not described herein, generally apply to taxable
distributions from other qualified plans (although, in the case of plans
qualified under Sections 401 and 403, exception "c" above for substantially
equal periodic payments applies only if the owner has separated from service).
In addition, the penalty tax does not apply to certain distributions from IRAs
taken after December 31, 1997 which are used for qualified first time home
purchases or for higher education expenses. Special conditions must be met to
qualify for these two exceptions to the penalty tax. Owners wishing to take a
distribution from an IRA for these purposes should consult their tax advisor.

When issued in connection with a qualified plan, a contract will be
amended as generally necessary to conform to the requirements of the plan.
However, contract owners, annuitants, and beneficiaries are cautioned that the
rights of any person to any benefits under qualified plans may be subject to the
terms and conditions of the plans themselves, regardless of the terms and
conditions of the contract. In addition, the Company shall not be bound by terms
and conditions of qualified plans to the extent such terms and conditions
contradict the contract, unless the Company consents.

QUALIFIED PLAN TYPES

Following are brief descriptions of various types of qualified plans in
connection with which the Company may issue a contract.

Individual Retirement Annuities. Section 408 of the Code permits
eligible individuals to contribute to an individual retirement program known as
an "Individual Retirement Annuity" or "IRA." IRAs are subject to limits on the
amounts that may be contributed, the persons who may be eligible and on the time
when distributions may commence. Also, distributions from certain other types of
qualified retirement plans may be "rolled over" on a tax-deferred basis into an
IRA. This contract may not, however, be used in connection with an "Education
IRA" under Section 530 of the Code.

IRAs generally may not provide life insurance coverage, but they may
provide a death benefit that equals the greater of the premiums paid and the
contract value. The contract provides a death benefit that in certain
circumstances may exceed the greater of the purchase payments and the contract
value. It is possible that the contract's death benefit could be viewed as
providing life insurance coverage with the result that the contract would not be
viewed as satisfying the requirements of an IRA.

Simplified Employee Pensions (SEP-IRAs). Section 408(k) of the Code
allows employers to establish simplified employee pension plans for their
employees, using the employees' IRAs for such purposes, if certain criteria are
met. Under these plans the employer may, within specified limits, make
deductible contributions on behalf of the employees to IRAs. As discussed above
(see Individual Retirement Annuities), there is some uncertainty regarding the
treatment of the contract's death benefit for purposes of the

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tax rules governing IRAs (which would include SEP-IRAs). Employers intending to
use the contract in connection with such plans should seek competent advice.

SIMPLE IRAs. Section 408(p) of the Code permits certain small employers
to establish "SIMPLE retirement accounts," including SIMPLE IRAs, for their
employees. Under SIMPLE IRAs, certain deductible contributions are made by both
employees and employers. SIMPLE IRAs are subject to various requirements,
including limits on the amounts that may be contributed, the persons who may be
eligible, and the time when distributions may commence. As discussed above (see
Individual Retirement Annuities), there is some uncertainty regarding the proper
characterization of the contract's death benefit for purposes of the tax rules
governing IRAs (which would include SIMPLE IRAs). Employers intending to use the
contract in connection with such plans should seek competent advice.

Corporate and Self-Employed ("H.R. 10" and "Keogh") Pension and
Profit-Sharing Plans. Sections 401(a) and 403(a) of the Code permit corporate
employers to establish various types of tax-favored retirement plans for
employees. The Self-Employed Individuals' Tax Retirement Act of 1962, as
amended, commonly referred to as "H.R. 10" or "Keogh," permits self-employed
individuals also to establish such tax-favored retirement plans for themselves
and their employees. Such retirement plans may permit the purchase of the
contracts in order to provide benefits under the plans. The contract provides a
death benefit that in certain circumstances may exceed the greater of the
purchase payments and the contract value. It is possible that such death benefit
could be characterized as an incidental death benefit. There are limitations on
the amount of incidental benefits that may be provided under pension and profit
sharing plans. In addition, the provision of such benefits may result in current
taxable income to participants. Employers intending to use the contract in
connection with such plans should seek competent advice.

Tax-Sheltered Annuities. Section 403(b) of the Code permits public
school employees and employees of certain types of charitable, educational and
scientific organizations specified in Section 501(c)(3) of the Code to have
their employers purchase annuity contracts for them and, subject to certain
limitations, to exclude the amount of purchase payments from gross income for
tax purposes. These annuity contracts are commonly referred to as "tax-sheltered
annuities." Purchasers of the contracts for such purposes should seek competent
advice as to eligibility, limitations on permissible amounts of purchase
payments and other tax consequences associated with the contracts. In
particular, purchasers should consider that the contract provides a death
benefit that in certain circumstances may exceed the greater of the purchase
payments and the contract value. It is possible that such death benefit could be
characterized as an incidental death benefit. If the death benefit were so
characterized, this could result in currently taxable income to purchasers. In
addition, there are limitations on the amount of incidental benefits that may be
provided under a tax-sheltered annuity. Even if the death benefit under the
contract were characterized as an incidental death benefit, it is unlikely to
violate those limits unless the purchaser also purchases a life insurance
contract as part of his or her tax-sheltered annuity plan.

Tax-sheltered annuity contracts must contain restrictions on
withdrawals of (i) contributions made pursuant to a salary reduction agreement
in years beginning after December 31, 1988, (ii) earnings on those
contributions, and (iii) earnings after 1988 on amounts attributable to salary
reduction contributions (and earnings on those contributions) held as of the
last day of the year beginning before January 1, 1989. These amounts can be paid
only if the employee has reached age 59 1/2, separated from service, died, or
become disabled (within the meaning of the tax law), or in the case of hardship
(within the meaning of the tax law). Amounts permitted to be distributed in the
event of hardship are limited to actual contributions; earnings thereon cannot
be distributed on account of hardship. Amounts subject to the withdrawal
restrictions applicable to Section 403(b)(7) custodial accounts may be subject
to more stringent restrictions. (These limitations on withdrawals do not apply
to the extent the Company is directed to transfer some or all of the contract
value to the issuer of another tax-sheltered annuity or into a Section 403(b)(7)
custodial account.)

Deferred Compensation Plans of State and Local Governments and
Tax-Exempt Organizations. Section 457 of the Code permits employees of state and
local governments and tax-exempt organizations to defer a portion of their
compensation without paying current taxes. The employees must be participants in
an eligible deferred compensation plan. Generally, a contract purchased by a
state or local government or a tax-exempt organization will not be treated as an
annuity contract for Federal income tax purposes. Those who intend to use the
contracts in connection with such plans should seek competent advice.

Roth IRAs. Recently enacted Section 408A of the Code permits eligible
individuals to contribute to a type of IRA known as a "Roth IRA." Roth IRAs
differ from other IRAs in several respects. Among the differences is that,
although contributions to a Roth IRA are not deductible, "qualified
distributions" from a Roth IRA will be excludable from income. Additionally, the
eligibility and mandatory distribution requirements for Roth IRAs differ from
non-Roth IRAs. Furthermore, a rollover may be made to a Roth IRA only if it is a
"qualified rollover contribution." A "qualified rollover

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contribution" is a rollover contribution to a Roth IRA from another Roth IRA or
from a non-Roth IRA, but only if such rollover contribution meets the rollover
requirements for IRAs under Section 408(d)(3) of the Code. In the case of a
qualified rollover contribution or a transfer from a non-Roth IRA to a Roth IRA,
any portion of the amount rolled over which would be includible in gross income
were it not part of a qualified rollover contribution or a nontaxable transfer
will be includible in gross income. However, the 10 percent penalty tax on
premature distributions generally will not apply.

All or part of amounts in a non-Roth IRA may be converted into a Roth
IRA. Such a conversion can be made without taking an actual distribution from
the IRA. For example, an individual may make a conversion by notifying the IRA
issuer or trustee, whichever is applicable. The conversion of an IRA to a Roth
IRA is a special type of qualified rollover distribution. Hence, the IRA
participant must be eligible to make a qualified rollover distribution in order
to convert an IRA to a Roth IRA. A conversion typically will result in the
inclusion of some or all of the IRA value in gross income, as described above.
Persons with adjusted gross incomes in excess of $100,000 or who are married and
file a separate return are not eligible to make a qualified rollover
contribution or a transfer in a taxable year from a non-Roth IRA to a Roth IRA.

Any "qualified distribution" from a Roth IRA is excludible from gross
income. A "qualified distribution" is a payment or distribution which satisfies
two requirements. First, the payment or distribution must be (a) made after the
owner attains age 59-1/2, (b) made after the owner's death, (c) attributable to
the owner being disabled, or (d) a qualified first-time homebuyer distribution
within the meaning of Section 72(t)(2)(F) of the Code. Second, the payment or
distribution must be made in a taxable year that is at least five years after
(a) the first taxable year for which a contribution was made to any Roth IRA
established for the owner, or (b) in the case of a payment or distribution
properly allocable to a qualified rollover contribution from a non-Roth IRA (or
income allocable thereto), the taxable year in which the rollover contribution
was made. A distribution from a Roth IRA which is not a qualified distribution
is generally taxed in the same manner as a distribution from non-Roth IRAs.
Distributions from a Roth IRA need not commence at age 70-1/2.

As described above (see "Individual Retirement Annuities"), there is
some uncertainty regarding the proper characterization of the contract's death
benefit for purposes of the tax rules governing IRAs (which include Roth IRAs).
Persons intending to use the contract in connection with a Roth IRA should seek
competent advice.

DIRECT ROLLOVERS

If the contract is used in connection with a retirement plan that is
qualified under Sections 401(a), 403(a), or 403(b) of the Code, any "eligible
rollover distribution" from the contract will be subject to "direct rollover"
and mandatory withholding requirements. An eligible rollover distribution
generally is any taxable distribution from such qualified plans, excluding
certain amounts such as (i) minimum distributions required under Section
401(a)(9) of the Code, and (ii) certain distributions for life, life expectancy,
or for 10 years or more which are part of a "series of substantially equal
periodic payments."

Under these requirements, Federal income tax equal to 20% of the
eligible rollover distribution will be withheld from the amount of the
distribution. Unlike withholding on certain other amounts distributed from the
contract, discussed below, the owner cannot elect out of withholding with
respect to an eligible rollover distribution. However, this 20% withholding will
not apply if, instead of receiving the eligible rollover distribution, the
distributee elects to have it directly transferred to certain qualified plans.
Prior to receiving an eligible rollover distribution, a notice will be provided
explaining generally the direct rollover and mandatory withholding requirements
and how to avoid the 20% withholding by electing a direct rollover.

FEDERAL INCOME TAX WITHHOLDING

The Company will withhold and remit to the U.S. Government a part of the taxable
portion of each distribution made under a contract unless the distributee
notifies the Company at or before the time of the distribution that he or she
elects not to have any amounts withheld. In certain circumstances, the Company
may be required to withhold tax. The withholding rates applicable to the taxable
portion of periodic annuity payments are the same as the withholding rates
generally applicable to payments of wages. In addition, the withholding rate
applicable to the taxable portion of non-periodic payments (including
withdrawals prior to the maturity date and rollovers from non Roth IRAs to Roth
IRAs) is 10%. As discussed above, the withholding rate applicable to eligible
rollover distributions is 20%.

41
<PAGE> 47
GENERAL MATTERS

TAX DEFERRAL

The status of the contract as an annuity generally allows all earnings
on the underlying investments to be tax-deferred until withdrawn or until
annuity payments begin (see "FEDERAL TAX MATTERS"). This tax deferred treatment
may be beneficial to contract owners in building assets in a long-term
investment program.

PERFORMANCE DATA

Each of the sub-accounts may in its advertising and sales materials
quote total return figures. The sub-accounts may advertise both "standardized"
and "non-standardized" total return figures, although standardized figures will
always accompany non-standardized figures. Non-standardized total return figures
may be quoted assuming both (i) redemption at the end of the time period and
(ii) not assuming redemption at the end of the time period. Standardized figures
include total return figures from: (i) the inception date of the sub-account of
the Variable Account which invests in the portfolio or (ii) ten years, whichever
period is shorter. Non-standardized figures include total return numbers from:
(i) inception date of the portfolio or (ii) ten years, whichever period is
shorter. Such figures will always include the average annual total return for
recent one year and, when applicable, five and ten year periods and, where less
than ten years, the inception date of the sub-account, in the case of
standardized returns, and the inception date of the portfolio, in the case of
non-standardized returns. Where the period since inception is less than one
year, the total return quoted will be the aggregate return for the period. The
average annual total return is the average annual compounded rate of return that
equates a purchase payment to the market value of such purchase payment on the
last day of the period for which such return is calculated. The aggregate total
return is the percentage change (not annualized) that equates a purchase payment
to the market value of such purchase payment on the last day of the period for
which such return is calculated. For purposes of the calculations it is assumed
that an initial payment of $1,000 is made on the first day of the period for
which the return is calculated. For total return figures quoted for periods
prior to the commencement of the offering of this contract, August 4, 1997,
standardized performance data will be the historical performance of the Trust
portfolio from the date the applicable sub-account of the Variable Account first
became available for investment under other contracts offered by the Company,
adjusted to reflect current contract charges. In the case of non-standardized
performance, performance figures will be the historical performance of the Trust
portfolio from the inception date of the portfolio (or in the case of the Trust
portfolios created in connection with the merger of Manulife Series Fund, Inc.
into the Trust, the inception date of the applicable predecessor Manulife Series
Fund portfolio), adjusted to reflect current contract charges. Past performance
figures quoted are not intended to indicate future performance of any
sub-account. More detailed information on the computations is set forth in the
Statement of Additional Information.

FINANCIAL STATEMENTS

Financial Statements for the Variable Account and the Company are
contained in the Statement of Additional Information.

ASSET ALLOCATION AND TIMING SERVICES

The Company is aware that certain third parties are offering asset
allocation and timing services in connection with the contracts. In certain
cases the Company has agreed to honor transfer instructions from such asset
allocation and timing services where it has received powers of attorney, in a
form acceptable to it, from the contract owners participating in the service.
THE COMPANY DOES NOT ENDORSE, APPROVE OR RECOMMEND SUCH SERVICES IN ANY WAY AND
CONTRACT OWNERS SHOULD BE AWARE THAT FEES PAID FOR SUCH SERVICES ARE SEPARATE
AND IN ADDITION TO FEES PAID UNDER The CONTRACTS.

RESTRICTIONS UNDER THE TEXAS OPTIONAL RETIREMENT PROGRAM

Section 830.105 of the Texas Government Code permits participants in
the Texas Optional Retirement Program ("ORP") to withdraw their interest in a
variable annuity contract issued under the ORP only upon (1) termination of
employment in the Texas public institutions of higher education, (2) retirement,
(3) death, or (4) the participant's attainment of age 70 1/2. Accordingly,
before any amounts may be distributed from the contract, proof must be furnished
to the Company that one of these four events has occurred. The foregoing
restrictions on withdrawal do not apply in the event a participant in the ORP
transfers the contract value to another contract or another qualified custodian
during the period of participation in the ORP. Loans are not available under
contracts subject to the ORP.

42
<PAGE> 48
DISTRIBUTION OF CONTRACTS

MSS, located at 73 Tremont Street, Boston, Massachusetts 02108, a
Delaware limited liability company controlled by the Company, is the principal
underwriter of the contracts in addition to providing advisory services to the
Trust. MSS is a broker-dealer registered under the Securities Exchange Act of
1934 (the "1934 Act") and a member of the National Association of Securities
Dealers, Inc. ("NASD"). MSS has entered into a non-exclusive promotional agent
agreement with Wood Logan Associates, Inc. ("Wood Logan"). Wood Logan is a
broker-dealer registered under the 1934 Act and a member of the NASD. Wood Logan
is a wholly owned subsidiary of a holding company that is 62.5% owned by The
Manufacturers Life Insurance Company (U.S.A.), 22.5% owned by MRL Holding, LLC
and 15% owned by the principals of Wood Logan. Sales of the contracts will be
made by registered representatives of broker-dealers authorized by MSS to sell
the contracts. Such registered representatives will also be licensed insurance
agents of the Company. Under the promotional agent agreement, Wood Logan will
recruit and provide sales training and licensing assistance to such registered
representatives. In addition, Wood Logan will prepare sales and promotional
materials for the Company's approval. MSS will pay distribution compensation to
selling brokers in varying amounts which under normal circumstances are not
expected to exceed 4% of purchase payments plus up to .75% of the contract value
per year commencing 18 months after each purchase payment. MSS may from time to
time pay additional compensation pursuant to promotional contests. Additionally,
in some circumstances, MSS will provide reimbursement of certain sales and
marketing expenses. MSS will pay the promotional agent for providing marketing
support for the distribution of the contracts.

CONTRACT OWNER INQUIRIES

All contract owner inquiries should be directed to the Company's
Annuity Service Office at P.O. Box 9230, Boston, Massachusetts 02205-9230.

CONFIRMATION STATEMENTS

Owners will be sent confirmation statements for certain transactions in
their account. Owners should carefully review these statements to verify their
accuracy. Any mistakes should immediately be reported to the Company's Annuity
Service Office. If the owner fails to notify the Company's Annuity Service
Office of any mistake within 60 days of the mailing of the confirmation
statement, the owner will be deemed to have ratified the transaction.

LEGAL PROCEEDINGS

There are no legal proceedings to which the Variable Account is a party
or to which the assets of the Variable Account are subject. Neither the Company
nor MSS are involved in any litigation that is of material importance in
relation to their total assets or that relates to the Variable Account.

OTHER INFORMATION

A registration statement has been filed with the SEC under the 1933 Act
with respect to the contracts described in this Prospectus. Not all the
information set forth in the registration statement, amendments and exhibits
thereto has been included in this Prospectus. Statements contained in this
Prospectus or the Statement of Additional Information concerning the content of
the contracts and other legal instruments are only summaries. For a complete
statement of the terms of these documents, reference should be made to the
instruments filed with the SEC.

STATEMENT OF ADDITIONAL INFORMATION TABLE OF CONTENTS

General Information and History.......................................... 3
Performance Data......................................................... 3
Service
Independent Auditors.............................................. 9
Servicing Agent................................................... 10
Principal Underwriter............................................. 10

43
<PAGE> 49

Cancellation of Contract................................................. 10
Financial Statements..................................................... 11

APPENDIX A

EXAMPLE OF CALCULATION OF WITHDRAWAL CHARGE

EXAMPLE 1 - Assume a single payment of $50,000 is made into the contract, a 3%
payment enhancement of $1,500 is credited to contract value, no additional
payments are made and there are no partial withdrawals. The table below
illustrates five examples of the withdrawal charges that would be imposed if the
contract is completely withdrawn. All contract values are hypothetical.

<TABLE>
<CAPTION>
CONTRACT YEAR HYPOTHETICAL FREE WITHDRAWAL PAYMENTS LIQUIDATED WITHDRAWAL CHARGE
CONTRACT VALUE AMOUNT
------------------------
PERCENT AMOUNT
- ----------------------------------------------------------------------- ------------------------
<S> <C> <C> <C> <C> <C>
2 $55,000 $5,000 (a) $50,000 8.50% $4,250
4 $50,500 $5,000 (b) $45,500 7.00% $3,185
6 $60,000 $10,000 (c) $50,000 5.00% $2,500
8 $80,000 $30,000 (d) $50,000 3.00% $1,500
10 $70,000 $20,000 (e) $50,000 0.00% $0
</TABLE>

(a) During any contract year the free withdrawal amount is the greater of
(i) the contract value less unliquidated payments (accumulated
earnings), or (ii) 10% of total payments made under the contract less
any partial withdrawals in that contract year. In the second contract
year the earnings under the contract are $5,000 ($55,000 - $50,000 =
$5,000), and 10% of payments is equal to $5,000 (0.10 x $50,000 =
$5,000). Consequently, on total withdrawal $5,000 is withdrawn free of
the withdrawal charge, the entire $50,000 payment is liquidated and the
withdrawal charge is assessed against such liquidated payment (the
lesser of (i) total unliquidated payments, or (ii) contract value less
free withdrawal amount).

(b) In the example for the fourth contract year, there were no earnings in
the contract, therefore the free withdrawal amount is equal to 10% of
payments (0.10 x $50,000 = $5,000) and the withdrawal charge is only
applied to payments liquidated.

(c) In the example for the sixth contract year, the accumulated earnings of
$10,000 is greater than 10% of payments ($5,000), therefore the free
withdrawal amount is equal to the accumulated earnings of $10,000 and
the withdrawal charge is applied to the payments liquidated.

(d) In the example for the eighth contract year, the accumulated earnings of
$30,000 is greater than 10% of payments ($5,000), therefore the free
withdrawal amount is equal to the accumulated earnings of $30,000 and
the withdrawal charge is applied to the payments liquidated.

(e) There is no withdrawal charge on any payments that have been in the
contract for at least 10 years.

44
<PAGE> 50
EXAMPLE 2 - Assume a single payment of $50,000 is made into the contract, a 3%
payment enhancement of $1,500 is credited to contract value, no transfers are
made, no additional payments are made and there are a series of four partial
withdrawals made during the third contract year of $2,000, $5,000, $7,000 and
$8,000.

<TABLE>
<CAPTION>
HYPOTHETICAL PARTIAL WITHDRAWAL FREE WITHDRAWAL PAYMENTS WITHDRAWAL CHARGE
CONTRACT VALUE REQUESTED AMOUNT LIQUIDATED
--------------------
PERCENT AMOUNT
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$65,000 $2,000 $15,000 (a) $0 8.00% $0
$49,000 $5,000 $3,000 (b) $2,000 8.00% $160
$52,000 $7,000 $4,000 (c) $3,000 8.00% $240
$44,000 $8,000 $0 (d) $8,000 8.00% $640
</TABLE>

(a) The free withdrawal amount during any contract year is the greater of (i)
the contract value less unliquidated payments (accumulated earnings), or
(ii) 10% of payments less 100% of all prior withdrawals in that contract
year. For the first example, accumulated earnings of $15,000 ($65,000 -
$50,000 = $15,000) is the free withdrawal amount since it is greater than
10% of payments less prior withdrawals ($5,000 - $0). The amount requested
($2,000) is less than the free withdrawal amount.
Therefore, payments are not liquidated and no withdrawal charge applies.

(b) The contract has negative accumulated earnings ($49,000 - $50,000 less
than 0) , so the free withdrawal amount is limited to 10% of payments less
100% of all prior withdrawals during the contract year. Since $2,000 has
already been withdrawn in the current contract year, the remaining free
withdrawal during the third contract year is $3,000. The $5,000 partial
withdrawal will consist of $3,000 free of withdrawal charge, and the
remaining $2,000 will be subject to a withdrawal charge and will result in
payments being liquidated. The remaining unliquidated payments after the
$5,000 partial withdrawal is $48,000 ($50,000 - $2,000 = $48,000).

(c) The contract has increased in value to $52,000. The unliquidated payments
are $48,000 which results in $4,000 of accumulated earnings ($52,000 -
$48,000 = $4,000) which is greater than 10% of payments less prior
withdrawals this contract year ($5,000 - $2,000 - $5,000 less than 0 ).
Hence the free withdrawal amount is $4,000 leaving $3,000 of the $7,000
partial withdrawal subject to a withdrawal charge. The unliquidated
payments are reduced by $3,000 to $45,000.

(d) The free withdrawal amount is zero since the contract has negative
accumulated earnings ($44,000 - $45,0000 less than 0) and the full 10% of
payments ($5,000) has already been withdrawn. The full amount of $8,000
will result in payments being liquidated subject to a withdrawal charge. At
the beginning of the next contract year the full 10% of payments would be
available for withdrawal requests during that contract year.

45
<PAGE> 51
APPENDIX B

STATE PREMIUM TAXES

Premium taxes vary according to the state and are subject to change. In many
jurisdictions there is no tax at all. For current information, a tax advisor
should be consulted.

<TABLE>
<CAPTION>
TAX RATE

QUALIFIED NON-QUALIFIED
STATE CONTRACTS CONTRACTS

<S> <C> <C>
CALIFORNIA...................................... .50% 2.35%
DISTRICT OF COLUMBIA............................ 2.25% 2.25%
KENTUCKY........................................ 2.00% 2.00%
MAINE........................................... .00 2.00%
NEVADA.......................................... .00 3.50%
PUERTO RICO..................................... 1.00% 1.00%
SOUTH DAKOTA*................................... .00 1.25%
WEST VIRGINIA................................... 1.00% 1.00%
WYOMING......................................... .00 1.00%
</TABLE>

* Premium tax paid upon receipt of premium (no tax at annuitization if tax paid
on premium at issue)

46
<PAGE> 52
APPENDIX C

MAXIMUM MATURITY AGES IN PENNSYLVANIA

For all contracts issued in Pennsylvania the maximum maturity age based upon the
issue age of the annuitant is as follows:

ISSUE AGE MAXIMUM MATURITY AGE

70 or less 85
71-75 86
76-80 88
81-85 90
86-90 93
91-93 96
94-95 98
96-97 99
98-99 101
100-101 102
102 103
103 104
104 105
105 106

It is required that the annuitant exercise a settlement annuity
option no later than the maximum maturity age stated above. For example an
annuitant age 60 at issue must exercise a settlement option prior to the
attainment of age 86. The Company will use the issue age of the youngest named
annuitant in the determination of the required settlement option date.

If contracts are issued with annuitants over age 80, a withdrawal
charge could be imposed if they terminate the contract rather than elect a
settlement option upon attainment of the maximum maturity age. This is a result
of the restrictions by Pennsylvania in combination with the 9-year withdrawal
charge schedule of the contract.

47
<PAGE> 53
APPENDIX D

EXAMPLES OF PAYMENT ENHANCEMENT CALCULATIONS

The payment enhancement is determined based on the cumulative amount of payments
applied to your contract. The payment enhancements, as a percentage of payments,
are shown in the table below.

Payment
Cumulative Payments Enhancement
<S> <C> <C>
$10,000 to $499,999 3.0%
$500,000 to $2,499,999 4.0%
$2,500,000 and above 5.0%
</TABLE>

Payment enhancements are payable only as a percentage of each specific payment
applied to your contract. The two examples below demonstrate how the payment
enhancement is calculated:

EXAMPLE 1 - Assume an initial payment of $400,000 and a subsequent payment of
$200,000 are made into the contract. Payment enhancements would be determined as
follows*:

(a) A payment enhancement of $12,000 (3% x $400,000) would be allocated
among the investment options in proportion to the allocation of the
$400,000 initial payment.

(b) A payment enhancement of $8,000 (4% x $200,000) would be allocated among
the investment options in proportion to the allocation of the $200,000
subsequent payment.

EXAMPLE 2 - Assume an initial payment of $200,000 and a subsequent payment of
$400,000 are made into the contract. Payment enhancements would be determined as
follows*:

(a) A payment enhancement of $6,000 (3% x $200,000) would be allocated among
the investment options in proportion to the allocation of the $200,000
initial payment.

(b) A payment enhancement of $16,000 (4% x $400,000) would be allocated
among the investment options in proportion to the allocation of the
$400,000 subsequent payment.

*Unless the Company receives a Letter of Intent that the additional purchase
payments will be received within 13 months of the issue date of the contract. If
the Company receives a Letter of Intent, the payment enhancement will be
determined using the payment enhancement percentage associated with the total
amount of purchase payments set forth in the Letter of Intent (see "Payment
Enhancement").

48
<PAGE> 54
PART B

INFORMATION REQUIRED IN A

STATEMENT OF ADDITIONAL INFORMATION
<PAGE> 55
STATEMENT OF ADDITIONAL INFORMATION

MANUFACTURERS LIFE INSURANCE COMPANY

OF NORTH AMERICA

SEPARATE ACCOUNT A

THE MANUFACTURERS LIFE INSURANCE COMPANY

OF NORTH AMERICA

FLEXIBLE PURCHASE PAYMENT INDIVIDUAL DEFERRED
VARIABLE ANNUITY CONTRACT
NON-PARTICIPATING

This Statement of Additional Information is not a Prospectus. It
contains information in addition to that described in the Prospectus and should
be read in conjunction with the Prospectus dated the same date as this Statement
of Additional Information. The Prospectus may be obtained by writing The
Manufacturers Life Insurance Company of North America at the Annuity Service
Office, P.O. Box 9230, Boston, Massachusetts 02205-9230 or telephoning (800)
344-1029.

The date of this Statement of Additional Information is May 1, 1998.

The Manufacturers Life Insurance Company of North America

116 Huntington Avenue
Boston, Massachusetts 02116

(617) 266-6004

VTG20.SAI598

<PAGE> 56
STATEMENT OF ADDITIONAL INFORMATION

TABLE OF CONTENTS

General Information and History...................................... 3
Performance Data..................................................... 3
Services
Independent Auditors.......................................... 8
Servicing Agent............................................... 9
Principal Underwriter......................................... 9
Cancellation of Contracts.....................................
Financial Statements................................................. 10

2
<PAGE> 57
GENERAL INFORMATION AND HISTORY

The Manufacturers Life Insurance Company of North America Separate
Account A (the "Variable Account") is a separate investment account of The
Manufacturers Life Insurance Company of North America (the "Company"), a stock
life insurance company organized under the laws of Delaware in 1979. The
ultimate parent of the Company is The Manufacturers Life Insurance Company
("Manulife"), a Canadian mutual life insurance company based in Toronto, Canada.
Prior to January 1, 1996, the Company was a wholly owned subsidiary of North
American Life Assurance Company ("NAL"), a Canadian mutual life insurance
company. On January 1, 1996 NAL and Manulife merged with the combined company
retaining the Manulife name.

PERFORMANCE DATA

In calculating standardized return figures, all recurring charges (all
asset charges (mortality and expense risk fees and administrative fees)) are
reflected, and the asset charges are reflected in changes in unit values.
Standardized total return figures will be quoted assuming redemption at the end
of the period. Non-standardized total return figures reflecting redemption at
the end of the time period are calculated on the same basis as the standardized
returns. Non-standardized total return figures not reflecting redemption at the
end of the time period are calculated on the same basis as the standardized
returns except that the calculations assume no redemption at the end of the
period and does not reflect deduction of the annual contract fee. The Company
believes such non-standardized figures not reflecting redemptions at the end of
the time period are useful to contract owners who wish to assess the performance
of an ongoing contract of the size that is meaningful to the individual contract
owner.

For total return figures quoted for periods prior to the commencement
of the offering of this contract, August 4, 1997, standardized performance data
will be the historical performance of the Trust portfolio from the date the
applicable sub-account of the Variable Account first became available for
investment under other contracts offered by the Company, adjusted to reflect
current contract charges. In the case of non-standardized performance,
performance figures will be the historical performance of the Trust portfolio
from the inception date of the portfolio (or in the case of the Trust portfolios
created in connection with the merger of Manulife Series Fund, Inc. into the
Trust, the inception date of the applicable predecessor Manulife Series Fund,
Inc. portfolio), adjusted to reflect current contract charges.

3
<PAGE> 58
STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES

CALCULATED AS OF DECEMBER 31, 1997

================================================================================
<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 5 YEAR SINCE INCEPTION OR INCEPTION DATE*
10 YEARS, WHICHEVER
IS SHORTER
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging Markets N/A N/A -39.43% 01/01/97

Science & Technology N/A N/A 0.53% 01/01/97

International Small Cap -8.42 N/A -0.77% 03/04/96

Emerging Growth N/A N/A 7.84 01/01/97

Pilgrim Baxter Growth N/A N/A -9.12 01/01/97

Small/Mid Cap 4.91% N/A 5.96% 03/04/96

International Stock N/A N/A -6.75% 01/01/97

Worldwide Growth N/A N/A 2.98% 01/01/97

Global Equity 10.36% 12.07% 8.01% 03/18/88

Small Company Value N/A N/A -12.16% 10/01/97

Equity 8.83% 16.26% 13.32%+ 06/18/85

Growth 14.84% N/A 17.61% 07/15/96

Quantitative Equity N/A N/A 20.09% 01/01/97

Blue Chip Growth 16.40% 10.50% 10.32% 12/11/92

Real Estate Securities N/A N/A 10.83% 01/01/97

Value N/A N/A 11.70% 01/01/97

International Growth & -9.21% N/A 2.20% 01/09/95
Income

Growth and Income 22.21% 16.36% 15.12% 04/23/91

Equity-Income 19.13% N/A 14.92% 02/19/93

Balanced N/A N/A 8.12% 01/02/97

Aggressive Asset Allocation 8.68% 9.99% 7.97% 08/03/89

High Yield N/A N/A 2.38% 01/01/97

Moderate Asset Allocation 5.51% 8.10% 7.05% 08/03/89

Conservative Asset 1.17% 5.86% 5.83% 08/03/89
Allocation

Strategic Bond 0.76% N/A 6.76% 02/19/93
</TABLE>

4
<PAGE> 59

<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 5 YEAR SINCE INCEPTION OR INCEPTION DATE*
10 YEARS, WHICHEVER
IS SHORTER
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Global Government Bond -6.48% 7.31% 7.13% 03/18/88

Capital Growth Bond N/A N/A -0.73% 01/01/97

Investment Quality Bond 0.35% 4.42% 5.24%+ 06/18/85

U.S. Government Securities 1.49% 3.89% 5.53% 03/18/88

Money Market 4.49% 1.69% 3.76%+ 06/18/85

Lifestyle Aggressive 1000 N/A N/A 2.12% 01/01/97

Lifestyle Growth 820 N/A N/A 4.61% 01/01/97

Lifestyle Balanced 640 N/A N/A 4.69% 01/01/97

Lifestyle Moderate 460 N/A N/A 4.11% 01/01/97

Lifestyle Conservative 280 N/A N/A 2.39% 01/01/97
</TABLE>

*Inception date of the sub-account of the Variable Account which invests in the
portfolio.

+10 year average annual return.

5
<PAGE> 60

NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES
(ASSUMING REDEMPTION AT THE END OF THE TIME PERIOD)
CALCULATED AS OF DECEMBER 31, 1997

<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 5 YEAR SINCE INCEPTION OR INCEPTION DATE OF
10 YEARS, WHICHEVER PORTFOLIO
IS SHORTER
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
Pacific Rim Emerging -39.87% N/A -11.23% 10/04/94
Markets*

Science & Technology N/A N/A 0.53% 01/01/97

International Small Cap -8.42% N/A -0.77% 03/04/96

Emerging Growth N/A N/A 7.84% 01/01/97

Pilgrim Baxter Growth N/A N/A -9.12% 01/01/97

Small/Mid Cap 4.91% N/A 5.96% 03/04/96

International Stock N/A N/A -6.75% 01/01/97

Worldwide Growth N/A N/A 2.98% 01/01/97

Global Equity 10.36% 12.07% 8.01% 03/18/88

Small Company Value N/A N/A -12.16% 10/01/97

Equity 8.83% 16.26% 13.32%+ 06/18/85

Growth 14.84% N/A 17.61% 07/15/96

Quantitative Equity* 19.26% 13.97% 13.29%+ 04/30/87

Blue Chip Growth 16.40% 10.50% 10.32% 12/11/92

Real Estate Securities* 8.01% 14.41% 14.04+% 04/30/87

Value N/A N/A 11.70% 01/01/97

International Growth & -9.21% N/A 2.20% 01/09/95
Income

Growth and Income 22.21% 16.36% 15.12% 04/23/91

Equity Income 19.13% N/A 14.92% 02/19/93

Balanced N/A N/A 8.12% 01/01/97

Aggressive Asset Allocation 8.68% 9.99% 7.97% 08/03/89

High Yield N/A N/A 2.38% 01/01/97

Moderate Asset Allocation 5.51% 8.10% 7.05% 08/03/89

Conservative Asset 1.17% 5.86% 5.83% 08/03/89
Allocation

Strategic Bond 0.76% N/A 6.76% 02/19/93

</TABLE>

6
<PAGE> 61

Global Government Bond -6.48% 7.31% 7.13% 03/18/88

Capital Growth Bond* -1.28% 4.48% 6.80%+ 06/26/84

Investment Quality Bond -0.35% 4.42% 5.24%+ 06/18/85

U.S. Government Securities -1.49% 3.89% 5.53% 03/18/88

Money Market -4.49% 1.69% 3.76%+ 06/18/85

Lifestyle Aggressive 1000 N/A N/A 2.12% 01/01/97

Lifestyle Growth 820 N/A N/A 4.61% 01/01/97

Lifestyle Balanced 640 N/A N/A 4.69% 01/01/97

Lifestyle Moderate 460 % % 4.11% 01/01/97

Lifestyle Conservative 280 % % 2.39% 01/01/97
</TABLE>

+ 10 year average annual return.

*On December 31, 1996, Manulife Series Fund, Inc. merged with the Trust.
Performance presented for these sub-accounts is based upon the performance of
the respective predecessor Manulife Series Fund, Inc. portfolio for periods
prior to December 31, 1996. Performance for each of these sub-accounts is based
on the historical expenses and performance of the predecessor Manulife Series
Fund, Inc. portfolio, adjusted to reflect current contract charges, and,
therefore, does not reflect for periods prior to December 31, 1996 the current
Trust portfolio expenses that an investor would incur as a holder of units of
the sub-account.

7
<PAGE> 62

NON-STANDARDIZED AVERAGE ANNUAL TOTAL RETURN FIGURES
(ASSUMING NO REDEMPTION AT THE END OF THE TIME PERIOD)
CALCULATED AS OF DECEMBER 31, 1997

<TABLE>
<CAPTION>
TRUST PORTFOLIO 1 YEAR 5 YEAR SINCE INCEPTION OR INCEPTION DATE OF
10 YEARS, WHICHEVER PORTFOLIO
IS SHORTER
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pacific Rim Emerging -35.14% N/A -9.42% 10/04/94
Markets*

Science & Technology N/A N/A 9.01% 01/01/97

International Small Cap -0.76% N/A 3.76% 03/04/96

Emerging Growth N/A N/A 16.42% 01/01/97

Pilgrim Baxter Growth N/A N/A -1.53% 01/01/97

Small/Mid Cap 13.49% N/A 10.41% 03/04/96

International Stock N/A N/A 1.07% 01/01/97

Worldwide Growth N/A N/A 11.56% 01/01/97

Global Equity 18.94% 12.88% 8.07% 03/18/88

Small Company Value N/A N/A -4.85 10/01/97

Equity 17.41% 16.98% 13.37%+ 06/18/85

Growth 23.42% N/A 23.05% 07/15/96

Quantitative Equity* 27.84% 14.75% 13.35%+ 04/30/87

Blue Chip Growth 24.98% 11.38% 11.07% 12/11/92

Real Estate Securities* 16.59% 15.17% 14.09%+ 04/30/87

Value N/A N/A 20.28% 01/01/97

International Growth & -1.62% N/A 4.79% 01/09/95
Income

Growth and Income 30.79% 17.07% 15.45% 04/23/91

Equity Income 27.71% N/A 15.70% 02/19/93

Balanced N/A N/A 16.70 01/01/97

Aggressive Asset Allocation 17.26% 10.86% 8.17% 08/03/89

High Yield N/A N/A 10.96% 01/01/97

Moderate Asset Allocation 14.09% 9.03% 7.27% 08/03/89

Conservative Asset Allocation 9.72% 6.88% 6.05% 08/03/89
</TABLE>

8
<PAGE> 63

Global Government Bond 1.36% 8.26% 7.20% 03/18/88

Capital Growth Bond* 7.04% 5.54% 6.86%+ 06/26/84

Investment Quality Bond 8.06% 5.48% 5.31%+ 06/18/85

U.S. Government Securities 6.81% 4.98% 5.59% 03/18/88

Money Market 3.53% 2.86% 3.82%+ 06/18/85

Lifestyle Aggressive 1000 N/A N/A 10.70% 01/01/97

Lifestyle Growth 820 N/A N/A 13.19% 01/01/97

Lifestyle Balanced 640 N/A N/A 12.69 01/01/97

Lifestyle Moderate 460 N/A N/A % 01/01/97

Lifestyle Conservative 280 N/A N/A 10.97% 01/01/97
</TABLE>

+ 10 year average annual return.

*On December 31, 1996, Manulife Series Fund, Inc. merged with the Trust.
Performance presented for these sub-accounts is based upon the performance of
the respective predecessor Manulife Series Fund portfolio for periods prior to
December 31, 1996. Performance for each of these sub-accounts is based on the
historical expenses and performance of the predecessor Manulife Series Fund,
Inc. portfolio, adjusted to reflect current contract charges, and, therefore,
does not reflect for periods prior to December 31, 1996 the current Trust
portfolio expenses that an investor would incur as a holder of units of the
sub-account.

* * * * *

In addition to the non-standardized returns quoted above, each of the
sub-accounts may from time to time quote aggregate non-standardized total
returns calculated in the same manner as set forth above for other time periods.
From time to time the Trust may include in its advertising and sales literature
general discussions of economic theories, including but not limited to,
discussions on how demographic and political trends can affect the financial
markets. Further, the Trust may also include in its advertising and sales
literature specific information on each of the Trust's subadvisers, including
but not limited to, research capabilities of a subadviser, assets under
management, information relating to other clients of a subadviser, and other
generalized information.

SERVICES

INDEPENDENT AUDITORS

The financial statements of the Company and the Variable Account at
December 31, 1997 and 1996 and for the years then ended appearing in this
Statement of Additional Information have been audited by Ernst & Young LLP,
independent auditors, as set forth in their reports thereon appearing elsewhere
herein, and are included in reliance upon such report given upon the authority
of such firm as experts in accounting and auditing.

9
<PAGE> 64

The consolidated statements of income, changes in shareholder's equity
and cash flows for the year ended December 31, 1994, appearing in this Statement
of Additional Information have been included herein in reliance on the report of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.

The statement of operations and changes in net assets of the Variable
Account for the year ended December 31, 1995 appearing in this Statement of
Additional Information has been included herein in reliance on the report of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.

The financial statements of the Company which are included in the
Statement of Additional Information should be considered only as bearing on the
ability of the Company to meet its obligations under the contracts. They should
not be considered as bearing on the investment performance of the assets held in
the Variable Account.

SERVICING AGENT

Computer Sciences Corporation Financial Services Group ("CSC FSG")
provides to the Company a computerized data processing recordkeeping system for
variable annuity administration. CSC FSG provides various daily, semimonthly,
monthly, semiannual and annual reports including: daily updates on accumulation
unit values, variable annuity participants and transactions, agent production
and commissions; semimonthly commission statements; monthly summaries of agent
production and daily transaction reports; semiannual statements for contract
owners; and annual contract owner tax reports. CSC FSG receives approximately
$7.80 per policy per year, plus certain other fees paid by the Company for the
services provided.

PRINCIPAL UNDERWRITER

Manufacturers Securities Services, LLC ("MSS"), a Delaware limited
liability company controlled by the Company, serves as principal underwriter of
the contracts. Contracts are offered on a continuous basis. The aggregate dollar
amount of underwriting commissions paid to MSS in 1997, 1996, and 1995 were
______________, $83,031,288, and $68,782,161, respectively. MSS did not retain
any of these amounts during such periods.

CANCELLATION OF CONTRACT

The Company may, at its option, cancel a contract at the end of any two
consecutive contract years in which no purchase payments by or on behalf of the
contract owner have been made, if both (i) the total purchase payments made for
the contract, less any withdrawals, are less than $2,000; and (ii) the contract
value at the end of such two year period is less than $2,000. The Company, as a
matter of administrative practice, will attempt to notify a contract owner prior
to such cancellation in order to allow the contract owner to make the necessary
purchase payment to keep the contract in force. The cancellation of contract
provisions may vary in certain states in order to comply with the requirements
of insurance laws and regulations in such states.

10
<PAGE> 65
PART C

OTHER INFORMATION
<PAGE> 66
Item 24. Financial Statements and Exhibits

(a) Financial Statements

(1) Financial Statements of the Registrant, The
Manufacturers Life Insurance Company of North America
Separate Account A, formerly NASL Variable Account
(Part B of the registration statement).-To be filed
by amendment.

(2) Financial Statements of the Depositor, The
Manufacturers Life Insurance Company of North
America, formerly North American Security Life
Insurance Company (Part B of the registration
statement).-To be filed by amendment.

(b) Exhibits

(1) (i) Resolution of the Board of Directors of North
American Security Life Insurance Company
establishing the NASL Variable Account
Incorporated by reference to Exhibit (b)(1)(i)
to Form N-4, file number 33-76162, filed
February 25, 1998.

(ii) Resolution of the Board of Directors of North
American Security Life Insurance Company
redesignating existing sub-accounts and dividing
the NASL Variable Account to create additional
sub-accounts, dated May 30, 1995 - Incorporated
by reference to Exhibit (b)(1)(ii) to
post-effective amendment no. 2 to Form N-4, file
number 33-77878, filed March 1, 1996.

(iii) Resolution of the Board of Directors of North
American Security Life Insurance Company
redesignating existing sub-accounts and dividing
the NASL Variable Account to create additional
sub-accounts, dated September 30, 1996
--Incorporate by reference to Exhibit (b)(1)(ii)
to post-effective amendment no. 3 to Form N-4,
file number 33-77878, filed February 28, 1997.

(iv) Resolution of the Board of Directors of North
American Security Life Insurance Company
redesignating existing sub-accounts and dividing
the NASL Variable Account to create additional
sub-accounts, dated September 30, 1996 --
Incorporated by reference to Exhibit (b)(1)(iv)
to post-effective amendment no. 3 to Form N-4,
file number 33-77878, filed February 28, 1997.
<PAGE> 67

(v) Resolution of the Board of Directors of North
American Security Life Insurance Company
redesinating existing sub-accounts and dividing
the NASL Variable Account to create four
additional sub-accounts dated September 26, 1997
-- Incorporated by reference to Exhibit
(B)(1)(v) to Form N-4, file number, 33-76162
filed February 25, 1998.

(2) Agreements for custody of securities and similar
investments - Not Applicable.

(3) (i) Underwriting Agreement between North American
Security Life Insurance Company (Depositor) and
NASL Financial Services, Inc. (Underwriter)--
Incorporated by reference to Exhibit (b)(3)(i)
to Form N-4, file number 33-76162, filed
February 25, 1998.

(ii) Promotional Agent Agreement between NASL
Financial Services, Inc. (Underwriter), North
American Security Life Insurance Company
(Depositor), Wood Logan Associates, Inc.
(Promotional Agent) and NAWL Holding Company,
Inc.-- Incorporated by reference to Exhibit
(b)(3)(ii) to post-effective amendment no. 3 to
Form N-4, file number 33-77878, filed February
28, 1997.

(iii) Amendment to Promotional Agent Agreement
Incorporated by reference to Exhibit (b)(3)(iii)
to Form N-4, file number 33-76162, filed
February 25, 1998

(iv) Form of Selling Agreement between The
Manufacturers Life Insurance Company,
Manufacturers Securities Services, LLC, Selling
Broker-Dealer and General Agent--Incorporated
by reference to Exhibit (b)(3)(iv) to Form N-4,
file number 33-76162, filed February 25, 1998

(4) (i) Specimen Flexible Purchase Payment Individual
Deferred Variable Annuity Contract,
Non-Participating - Incorporated by reference to
Exhibit (b)(4)(i) to this registration
statement, filed April 7, 1997.

(ii) Specimen Endorsement to Contract: Fixed Account
Endorsement -- Filed herewith.

(5) Specimen Application for Flexible Purchase Payment
Individual Deferred Combination Fixed and Variable
Annuity Contract, Non-Participating Incorporated by
reference to Exhibit (b)(5) to registration
statement, filed April 7, 1997.
<PAGE> 68

(6) (i) Certificate of Incorporation of North
American Security Life Insurance Company --
Incorporated by reference to Exhibit (3)(i)
to Form 10Q of The Manufacturers Life
Insurance Company of North America filed
November 14, 1997.

(ii) Certificate of Amendment of Certificate of
Incorporation of the Company, Name Change
July 1984 -- Incorporated by reference to
Exhibit (3)(i)(a) to Form 10Q of The
Manufacturers Life Insurance Company of
North America, filed November 14, 1997.

(iii) Certificate of Amendment of Certificate of
Incorporation of the Company, Authorization
of Capital December 1994 -- Incorporated by
reference to Exhibit (3)(i)(b) to Form 10Q
of The Manufacturers Life Insurance Company
of North America, filed November 14, 1997.

(iv) Certificate of Amendment of Certificate of
Incorporation, Name change March 1997
--Incorporated by reference to Exhibit
(3)(i)(a) to post effective amendment no. 1
to Form S-1 on behalf of The Manufacturers
Life Insurance Company of North America,
file number 333-6011, filed October 9, 1997.

(v) Certificate of Amendment of Certificate of
Incorporation of the Company, Registered
Agent July 1997 -- Incorporated by reference
to Exhibit (3)(i)(c) to Form 10Q of The
Manufacturers Life Insurance Company of
North America filed November 14, 1997.

(vi) Amended and Restated By-laws of The
Manufacturers Life Insurance Company of
North America -- Incorporated by reference
to Exhibit (3)(ii) to Form 10Q of The
Manufacturers Life Insurance Company of
North America filed November 14, 1997.

(7) (i) Form of Variable Annuity Reinsurance
Agreement Contract between North American
Security Life Insurance Company and
Connecticut General Life Insurance Company,
effective July 1, 1997 -- filed herewith.

(ii) Form of Automatic Reinsurance Agreement
between North American Security Life
Insurance Company and Swiss Re Life & Health
America Inc., effective August 1, 1997 -
filed herewith.

<PAGE> 69
(8) Other material contracts not made in the ordinary
course of business which are to be performed in whole
or in part on or after the date the registration
statement is filed:

(i) Form of Remote Service Agreement dated
November 1, 1996 between North American
Security Life Insurance Company and CSC
Continuum Inc. -- Incorporated by reference
to Exhibit (b)(8)(i) to post-effective
amendment no. 3 to Form N-4, file number
33-77878, filed February 28, 1997.

(9) Opinion of Counsel and consent to its use as to the
legality of the securities being registered
--Incorporated by reference to Exhibit (b)(9) to this
registration statement, filed April 7, 1997.

(10) (i) Written consent of Ernst & Young LLP,
independent auditors--To be filed by
amendment..

(ii) Written consent of Coopers & Lybrand
LLP, independent accountants--To be filed by
amendment.

(11) All financial statements omitted from Item 23,
Financial Statements - Not Applicable

(12) Agreements in consideration for providing initial
capital between or among Registrant, Depositor,
Underwriter or initial contract owners--Not
Applicable.

(13) Schedules of computation,--Incorporated by reference
to Exhibit (b)(13) to post-effective amendment no. 2
to Form N-4, file number 33-76162, filed March 1,
1996.

(14) Financial Data Schedule - Not Applicable.

(15) (i) Power of Attorney - North American
Security Life Insurance Company Director
(John D. Richardson) - Incorporated by
reference to Exhibit (b)(15)(iii) to Form
N-4, file no. 33-28455 filed April 30, 1997
on behalf of the NASL Variable Account of
North American Security Life Insurance
Company.

(ii) Power of Attorney - David W. Libbey North
American Security Life Insurance Company
(Principal Financial Officer)--Incorporated
by reference to Exhibit (24)(ii) to Form 10Q
of The Manufacturers Life Insurance Company
of North America, filed November 14, 1997.

<PAGE> 70

(iii) Power of Attorney - Peter S. Hutchison
(Director, The Manufacturers Life Insurance
Company of North America) -- Incorporated by
reference to Exhibit (15)(iii) to Form N-4,
file number 33-76162 filed, February 25,
1998.

Item 25. Directors and Officers of the Depositor.

OFFICERS AND DIRECTORS OF THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH
AMERICA

Name and Principal
Business Address Position with Manulife North America

John D. Richardson Director and Chairman of the Board of Directors
200 Bloor Street East
North Tower 11th Floor
Toronto, Ontario
Canada M4W-1E5

Peter S. Hutchison Director
200 Bloor Street East
North Tower 11th Floor
Toronto, Ontario
Canada M4W-1E5

John D. DesPrez III President and Director
73 Tremont Street
Boston, MA 02108

James Boyle Vice President, Administration and Chief
116 Huntington Avenue Administrative Officer
Boston, MA 02116

John G. Vrysen Vice President and Chief Actuary
73 Tremont Street
Boston, MA 02108

Hugh McHaffie Vice President, U.S. Annuities and Product
73 Tremont Street Development
Boston, MA 02108

Richard C. Hirtle Vice President, Strategic Development and
116 Huntington Avenue Accumulation Life Products
Boston, MA 02116

<PAGE> 71

James D. Gallagher Vice President, Secretary and General Counsel
73 Tremont Street
Boston, MA 02108

Janet Sweeney Vice President, Corporate Services
73 Tremont Street
Boston, MA 02108

Robert Boyda Vice President, Investment Management Services
73 Tremont Street
Boston, MA 02108

David W. Libbey Vice President, Treasurer & Chief Financial Officer
73 Tremont Street
Boston, MA 02108

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

THE MANUFACTURERS LIFE INSURANCE COMPANY

Manulife Corporate Organization as at December 31, 1997
The Manufacturers Life Insurance Company (Canada)

1. Cantay Holdings Inc. - Ontario (100%)

2. 484551 Ontario Limited - Ontario (100%)

a. 911164 Ontario Inc. - Ontario (100%)

3. Churchill Lifestyles Corp. (100%)

4. 495603 Ontario Limited - Ontario (100%)

5. 1198183 Ontario Limited - Ontario (100%)

6. 1198184 Ontario Limited - Ontario (100%)

7. 1235434 Ontario Limited - Ontario (100%)

8. 576986 Ontario Inc. - Ontario (100%)

9. Balmoral Developments Inc. - Ontario (100%)

10. Manulife Bank of Canada - Canada (100%)

11. Manulife Securities International Ltd. - Canada (100%)

12. Family Realty First Corp. - Ontario (100%)

13. NAL Resources Limited - Alberta (100%)

14. Manulife International Capital Corporation Limited - Ontario (100%)

a. Regional Power Inc. - Ontario (100%)

i. La Regionale Power (Port Cartier) Inc. - Ontario
(100%)

ii. La Regionale Power Angliers Inc. - Ontario (100%)

iii. Addalam Power Corporation - Philippines (100%)

15. Peel-de Maisonneuve Investments Ltd. - Canada (100%)

a. 2932121 Canada Inc. - Canada (100%)

16. FNA Financial Inc. - Canada (100%)

a. NAL Trustco Inc. - Ontario (100%)

b. First North American Insurance Company - Canada (100%)

c. Elliott & Page Limited - Ontario (100%)

d. Seamark Asset Management Ltd. - Canada (67.86%)

<PAGE> 72

e. NAL Resources Management Limited - Canada (100%)

i. NAL Energy Inc. - Alberta (100%)

17. ManuCab Ltd. - Canada (100%)

a. Plazcab Service Limited - Newfoundland (100%)

18. Manufacturers Life Capital Corporation Inc. - Canada (100%)

19. The North American Group Inc. - Ontario (100%)

20. 994744 Ontario Inc. - Ontario (100%)

21. 1268337 Ontario Inc. - Ontario (100%)

22. 3426505 Canada Inc. - Canada (100%)

23. The Manufacturers Investment Corporation - Michigan (100%)

a. Manulife Reinsurance Corporation (U.S.A.) - Michigan (100%)

i. The Manufacturers Life Insurance Company (U.S.A.) - Michigan
(100%)

(1) Dover Leasing Investments, LLC - Delaware (99%)

(2) The Manufacturers Life Insurance Company of America -
Michigan (100%)

(a) Manulife Holding Corporation - Delaware (100%)

(i) Manufacturers Adviser Corporation -
Colorado (100%)

(ii) Succession Plainning International, Inc. -
Wisconsin (100%)

(iii) ManEquity, Inc. - Colorado (100%)

(iv) Manulife Property Management of
Washington, D.C. Inc. - Washington, D.C.
(100%)

(v) ManuLife Service Corporation - Colorado
(100%)

(vi) Manulife Leasing Company, LLC - Delaware
(80%)

(3) Capitol Bankers Life Insurance Company - Michigan
(100%)

(4) Ennal, Inc. - Ohio (100%)

(5) Manulife-Wood Logan Holding Co. Inc. - Delaware (62.5%)

(a) Wood Logan Associates, Inc. - Connecticut (100%)

(i) Wood Logan Distributors, Inc. -
Connecticut (100%)

(b) The Manufacturers Life Insurance Company of North
America - Delaware (100%)

(i) Manufacturers Securities Services, LLC -
Massachusetts (100%)

(ii) The Manufacturers Life Insurance Company
of New York - New York (100%)

ii. Manulife Reinsurance Limited - Bermuda (100%)

(1) MRL Holding, LLC - Delaware (99%)

(a) Manulife-Wood Logan Holding Co. Inc. - Delaware
(22.5%)

iii. MRL Holding, LLC - Delaware (1%)

<PAGE> 73

24. Manulife International Investment Management Limited - U.K. (100%)

a. Manulife International Fund Management Limited - U.K. (100%)

25. WT(SW) Properties Ltd. - U.K. (100%)

26. Manulife Europe Ruckversicherungs-Aktiengesellschaft - Germany (100%)

27. Manulife International Holdings Limited - Bermuda (100%)

a. Manulife (International) Limited - Bermuda (100%)

i. Zhong Hong Life Insurance Co., Ltd. - China (51%)

ii. The Manufacturers (Pacific Asia) Insurance Company Limited -
H.K. (100%)

iii. Newtime Consultants Limited - H.K. (100%)

28. Manulife (International) Reinsurance Limited - Bermuda (100%)

a. Manulife (International) P & C Limited - Bermuda (100%)

b. Manufacturers P & C Limited - Barbados (100%)

c. Manufacturers Life Reinsurance Limited - Barbados (100%)

29. Chinfon-Manulife Insurance Company Limited - Bermuda (100%)

30. Manulife (Malaysia) SDN. BHD. - Malaysia (100%)

31. Manulife (Thailand) Ltd. - Thailand (100%)

32. Young Poong Manulife Insurance Company - Korea (100%)

33. Manulife Data Services Inc. - Barbados (100%)

a. Manulife Funds Direct (Barbados) Limited - Barbados (100%)

i. Manulife Funds Direct (Hong Kong) Limited - H.K. (100%)

34. OUB Manulife Pte. Ltd. - Singapore (100%)

35. Manulife Holdings (Hong Kong) Limited - H.K. (100%)

36. ManuLife Financial Systems (Hong Kong) Limited - H.K. (100%)

37. P.T. Asuransi Jiwa Dhamala ManuLife - Indonesia (51%)

a. P.T. AMP Panin Life - Indonesia (100%)

Item 27. Number of Contract Owners.

As of December 31, 1997, there were 463 qualified contracts and 658
non-qualified contracts of the series offered hereby outstanding.

Item 28. Indemnification.

Article 9 of the Articles of Incorporation of the Company provides as follows:

NINTH: A director of this corporation shall not be liable to the corporation or
its stockholders for monetary damages for breach of fiduciary duty as a director
except to the extent such exemption from liability or limitation thereof is not
permitted under the General Corporation Law of the State of Delaware as the same
exists or may hereafter be amended. Any repeal or modification of the foregoing
sentence shall not adversely affect any right or protection of a director of the
corporation existing hereunder with respect to any act or omission occurring
prior to such repeal or modification.
<PAGE> 74
Article XIV of the By-laws of the Company provides as follows:

Each Director or officer, whether or not then in office, shall be
indemnified by the Company against all costs and expenses reasonably incurred by
or imposed upon him or her, including legal fees, in connection with or
resulting from any claim, action, suit or proceeding, whether civil, criminal or
administrative, in which he or she may become involved as a party or otherwise,
by reason of his or her being or having been a Director or officer of the
Company.

(1) Indemnity will not be granted to any Director or officer with
respect to any claim, action, suit or proceeding which shall be brought against
such Director or officer by or in the right of the Company, and

(2) Indemnification for amounts paid and expenses incurred in settling
such action, claim, suit or proceeding, will not be granted, until it shall be
determined by a disinterested majority of the Board of Directors or by a
majority of any disinterested committee or group of persons to whom the question
may be referred by the Board, that said Director or officer did indeed act in
good faith and in a manner he or she reasonably believed to be in, or not
adverse, to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had reasonably cause to believe that his or her
conduct was legal, and that the payment of such costs, expenses, penalties or
fines is in the interest of the Company, and not contrary to public policy or
other provisions of law.

The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendre or its equivalent, shall
not, of itself, create a presumption that the person did not act in good faith
and in a manner which he or she reasonably believed to be in, or not adverse, to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.
Indemnification shall be made by the corporation upon determination by a
disinterested majority of the Board of Directors or of a majority of any
disinterested committee or group or persons to whom the question may be referred
to by said Board, that the person did indeed act in good faith and in a manner
he or she reasonably believed to be in, or not adverse, to the best interests of
the corporation, and, with respect to any criminal action or proceeding, had
reasonably cause to believe that his or her conduct was legal.

The foregoing right to indemnity shall not be exclusive of any other
rights to which such Director or officer may be entitled as a matter of law.

The foregoing right to indemnity shall also extend to the estate of any
deceased Director or officer with respect to any such claim, action, suit or
proceeding in which such Director or officer or his or her estate may become
involved by reason of his or her having been a Director or officer of the
Company, and subject to the same conditions outlined above.
<PAGE> 75
Section IX, paragraph D of the Promotional Agent Agreement among the Company
(referred to therein as "Security Life"), NASL Financial and Wood/Logan
(referred to therein as "Promotional Agent") provides as follows:

a. NASL Financial and Security Life agree to indemnify and hold harmless
Promotional Agent, its officers, directors and employees against any
and all losses, claims, damages or liabilities to which they may become
subject under the Securities Act of 1933 ("1933 Act"), the 1934 Act or
other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact or any
omission or alleged omission to state a material fact required to be
stated or necessary to make the statements made not misleading in any
registration statement for the Contracts filed pursuant to the 1933 Act
or any prospectus included as a part thereof, as from time to time
amended and supplemented, or any advertisement or sales literature
approved in writing by NASL Financial or Security Life pursuant to
Section VI, paragraph B of this Agreement.

b. Promotional Agent agrees to indemnify and hold harmless NASL Financial
and Security Life, their officers, directors and employees against any
and all losses, claims, damages or liabilities to which they may become
subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon: (i) any oral or written
misrepresentation by Promotional Agent or its officers, directors,
employees or agents unless such misrepresentation is contained in any
registration statement for the Contracts or Fund shares, any prospectus
included as a part thereof, as from time to time amended and
supplemented, or any advertisement or sales literature approved in
writing by NASL Financial pursuant to Section VI, paragraph B of this
Agreement or, (ii) the failure of Promotional Agent or its officers,
directors, employees or agents to comply with any applicable provisions
of this Agreement.

Notwithstanding the foregoing, Registrant hereby makes the following undertaking
pursuant to Rule 484 under the Securities Act of 1933:

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 a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE> 76
Item 29. Principal Underwriters.

a. Name of Investment Company Capacity In which acting

Manufacturers Investment Trust Investment Adviser

The Manufacturers Life Insurance Principle Underwriter
Company of North America Separate
Account A

The Manufacturers Life Insurance Principle Underwriter
Company of North America Separate
Account B

The Manufacturers Life Insurance Principle Underwriter
Company of New York Separate
Account A

b. The Manufacturers Life Insurance Company of North America is the managing
member of Manufacturers Securities Services, LLC and has sole power to act on
behalf of Manufacturers Securities Services, LLC. The officers and directors of
The Manufacturers Life Insurance Company of North America are set forth under
Item 25.

c. None.

Item 30. Location of Accounts and Records.

All books and records are maintained at 116 Huntington Avenue, Boston, MA 02116
and at 73 Tremont Street, Boston, MA 02108.

Item 31. Management Services.

None.

Item 32. Undertakings.

Representation of Insurer Pursuant to Section 26 of the Investment Company Act
of 1940

The Manufacturers Life Insurance Company of North America ("Company") hereby
represents that the fees and charges deducted under the contracts issued
pursuant to this registration statement, in the aggregate, are reasonable in
relation to the services rendered, the expenses expected to be incurred, and the
risks assumed by the Company.

<PAGE> 77
SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act
of 1940, the Registrant, The Manufacturers Life Insurance Company of North
America Separate Account A, has caused this Post-Effective Amendment to the
Registration Statement to be signed on its behalf, in the City of Boston, and
Commonwealth of Massachusetts on this 26th day of February, 1998.

THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA SEPERATE
ACCOUNT A
(Registrant)

By: THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA
(Depositor)

By: /s/ JOHN D. DESPREZ III
------------------------------
John D. DesPrez III, President

Attest:

/s/ JAMES D. GALLAGHER
- -----------------------------
James D. Gallagher, Secretary

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Depositor has duly caused this
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned on the 26th Day of February, 1998 in the City of
Boston, and Commonwealth of Massachusetts.

THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NORTH AMERICA
(Depositor)

By: /s/ JOHN D. DESPREZ III
------------------------------
John D. DesPrez III, President

Attest:

/s/ JAMES D. GALLAGHER
- -----------------------------
James D. Gallagher, Secretary
<PAGE> 78
As required by the Securities Act of 1933, this Post-Effective
Amendment to the Registration Statement has been signed by the
following persons in the capacities with the Depositor and on the dates
indicated.

SIGNATURE TITLE DATE

/s/ JOHN D. DESPREZ III Director and President February 26, 1998
----------------------- (Principal Executive (Date)
John D. DesPrez III Officer)

* Director February 26, 1998
----------------------- (Date)
Peter S. Hutchison

* Director and Chairman February 26, 1998
----------------------- of the Board (Date)
John D. Richardson

/s/ DAVID W. LIBBEY Vice President and February 26, 1998
----------------------- Treasurer (Principal (Date)
David W. Libbey Financial and Accounting

*By: /s/ JAMES D. GALLAGHER February 26, 1998
--------------------- (Date)
James D. Gallagher
Attorney-in-Fact
Pursuant to Powers
of Attorney
<PAGE> 79
EXHIBIT INDEX

Exhibit No. Description

(4)(ii) Specimen Endorsement to Contract: Fixed Account Endorsement

(7)(i) Form of Variable Annuity Reinsurance Agreement Contract between
North American Security Life Insurance Company and Connecticut
General Life Insurance Company, effective July 1, 1997

(7)(ii) Form of Automatic Reinsurance Agreement between North American
Security Life Insurance Company and Swiss Re Life & Health America
Inc., effective August 1, 1997

<PAGE> 1
FIXED ACCOUNT ENDORSEMENT

PART 7, FIXED ACCOUNT PROVISIONS, INVESTMENT ACCOUNT of all contracts to which
this Endorsement is attached is replaced as follows:

INVESTMENT ACCOUNT We will establish a separate Investment Account for
you each time you allocate amounts to a fixed
Investment Option. Amounts invested in these
Investment Accounts will earn interest at the
guaranteed rate in effect on the date the amounts are
allocated for the duration of the guarantee period.

We will determine the guaranteed rate from time to
time for Net Payments, renewal amounts and amounts
transferred to a fixed Investment Option. In no event
will the minimum guaranteed rate under a fixed
Investment Account be less than 3%.

PART 7, FIXED ACCOUNT PROVISIONS, 1-YEAR DOLLAR COST AVERAGING OPTION is added
to all contracts to which this Endorsement is attached as follows:

1-YEAR DOLLAR COST The 1-Year DCA Investment Option may be elected by
AVERAGING (DCA) the Owner to make automatic monthly transfers from a
INVESTMENT OPTION 1-Year fixed Investment Account to one or more
variable Investment Options. Only initial and
subsequent Net Payments may be allocated to the
1-Year DCA Investment Option. Amounts may not be
transferred from other Investment Options to the
1-Year DCA Investment Option.

The automatic monthly transfer amount, "DCA amount",
is determined as follows:

(a) In the first 11 months, the DCA amount will be
equal to 1/11 of the amount allocated to the 1-Year
DCA Investment Option.

(b) At the end of the 12th month, the DCA amount
will be equal to the remaining balance in the
Investment Account.

Endorsed on the Date of Issue of this Contract.

THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA

Vice-President

<PAGE> 1
VARIABLE ANNUITY REINSURANCE AGREEMENT

Effective Date of July 1, 1997

Between

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY
(Boston, Massachusetts)

and

CONNECTICUT GENERAL LIFE INSURANCE COMPANY
(Hartford, Connecticut)

- -------------------------------------------------------------------------------
NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997
TREATY NO. 103049 -1-

<PAGE> 2
VARIABLE ANNUITY REINSURANCE AGREEMENT

between

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY

and

CONNECTICUT GENERAL LIFE INSURANCE COMPANY

INDEX
-----
<TABLE>
<CAPTION>
ARTICLE PAGE
------- ----
<S> <C> <C>
Access to Records XII 8
Amounts at Risk II 3
Arbitration XVII 11
Automatic Excess Reinsurance III 4
Claims VII 6
Currency XIV 9
DAC Tax Regulation Election XVIII 12
Delays, Errors, or Omissions XIII 9
Effective Date; Term and Termination XIX 12
Extra Contractual Obligations IX 7
Hold Harmless XV 10
Insolvency XVI 10
Liability of Connecticut General IV 4
Litigation X 8
Notices XX 15
Offset XI 8
Parties to the Agreement I 3
Premium Accounting VI 5
Reinsurance Premiums V 5
Reserves VIII 7
</TABLE>

SCHEDULES
---------
A Maximum Limits of Reinsurance in Connecticut General
B Policy Forms and Funds Subject to this Reinsurance Agreement
C Limits and Rules of NASL
D Reinsurance Premium Rates and Calculation Criteria
E Quarterly Reporting Format

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 2 -
TREATY NO. 103049
<PAGE> 3
VARIABLE ANNUITY REINSURANCE AGREEMENT
(hereinafter called Agreement)

between

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY
(hereinafter called NASL)

and

CONNECTICUT GENERAL LIFE INSURANCE COMPANY
(hereinafter called Connecticut General or CIGNA Reinsurance)

It is agreed by the two companies as follows:

ARTICLE I - PARTIES TO THE AGREEMENT

This Agreement shall be binding upon and shall inure solely to the benefit of
NASL and Connecticut General. This Agreement shall not and is not intended to
create any right or interest in any third party and shall not and is not
intended to create any legal relationship between either party and any third
party, including, without limitation, annuitants, insureds, certificate holders,
employees, dependents, beneficiaries, policy owners, applicants or assignees
under any policy or contract issued by NASL.

ARTICLE II - AMOUNTS AT RISK

A. The reinsurance death benefit is fifty (50) percent of the excess of the
guaranteed minimum death benefit over the contract value. At issue, the
guaranteed minimum death benefit is equal to the initial contract value.
Refer to Schedule A for a detailed description of the guaranteed minimum
death benefit.

B. The contract value represents the owner's invested assets in the funds in
Schedule B as it appears in the records of NASL before application of any
surrender charges, on any given date.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 3 -
TREATY NO. 103049
<PAGE> 4
ARTICLE III - AUTOMATIC EXCESS REINSURANCE

A. On and after the Effective Date of this Agreement, subject to the limit of
Connecticut General's liability set forth in Schedule A and all other
terms, conditions and limitations set forth in this Agreement and the
Schedules attached to and made a part hereof, NASL shall cede and
Connecticut General shall accept fifty (50) percent of NASL'S guaranteed
death benefit liability under the Variable Annuity Contracts, as described
in Article II A.

B. This Agreement covers only NASL'S liability for claims paid under Variable
Annuity Contracts written on forms and investment in funds which were
reviewed by Connecticut General prior to their issuance. Forms, as
supplemented by additional materials, and funds available as of the date of
this Agreement are listed on Schedule B. If NASL intends to cede to
Connecticut General liability with respect to a new form or fund, or a
revised version of an approved form or fund, it must provide to Connecticut
General written notice of such intention together with a copy of the
proposed form, fund or revision, and a revised Schedule B.

C. NASL shall provide written notice to Connecticut General of any changes in
its published limits and rules identified on Schedule C, and Connecticut
General shall have no liability pursuant to revised limits and rules unless
and until Connecticut General provides written notice to NASL that such
revised limits and rules are acceptable.

ARTICLE IV - LIABILITY OF CONNECTICUT GENERAL

Connecticut General's liability for reinsurance under this Agreement shall
follow that of NASL in every case, and be subject in all respects to the general
stipulations, terms, clauses, conditions, waivers and modifications of the
Variable Annuity Contracts.

In no event shall Connecticut General have any reinsurance liability unless the
Variable Annuity Contract issued by NASL is in force and the underwriting and
issuance of coverage by NASL constitutes the doing of business in a state of the
United States of America in which NASL is properly licensed and authorized to do
business.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 4 -
TREATY NO. 103049
<PAGE> 5
ARTICLE V - REINSURANCE PREMIUMS

Premiums for reinsurance subject to the terms and conditions of this Agreement
shall be paid on a quarterly basis. Such premiums shall be determined by the
application of the rates set forth in Schedule D to the amount of reinsurance
coverage provided for each annuity insured by NASL as calculated based on the
criteria defined in Schedule D.

ARTICLE VI - PREMIUM ACCOUNTING

A. Reinsurance premiums shall be paid in advance on a Quarterly basis. On or
before the Due Date (as defined in Paragraph B), NASL shall forward to
Connecticut General its statement of account as set forth in Schedule E
together with its remittance for the net amount due as shown therein as
well as any premium adjustments from the prior quarter. If the statement
shows a balance due NASL, Reinsurer shall remit that amount to NASL on or
before the Remittance Date (the date occurring thirty days after the Due
Date). If the amounts described in Article VI cannot be determined by the
Due Dates set forth in Article VI, on an exact basis, such payments will be
made with a generally agreed upon formula which will approximate the actual
payments. Adjustments will then be made to reflect actual amounts when they
become available.

B. For the purposes of this Agreement the Due Date for Reinsurer's receipt of
the statement of account and premium due is the thirtieth day following the
close of any reporting period. The payment of reinsurance premiums in
accordance with the provisions herein shall be a condition precedent to the
liability of Reinsurer for reinsurance covered by this Agreement. In the
event that reinsurance premiums are not received by Reinsurer as of the Due
Date following the close of the reporting period in which they fall due,
Reinsurer will notify NASL that such premiums are due and unpaid, and NASL
will remit the premium on or before the Remittance Date. In the event that
the premiums are not paid by the Remittance Date, Reinsurer shall have the
right to give NASL notice of termination of such reinsurance immediately.

C. If reinsurance is terminated as provided in paragraph B, and if all
reinsurance premiums in default and any additional charges due in
accordance with this Agreement, including such premiums and charges which
may become in default are not paid by the Remittance Date, Reinsurer shall
thereupon be relieved automatically of future liability under all
reinsurance for which premiums and other charges remain unpaid. New and
existing Reinsurance for which premiums subsequently fall due will
terminate automatically if reinsurance premiums are not paid when due as
provided in paragraph B of this Article. The reinsurance so terminated may
be reinstated at any time within sixty days of the date of termination upon
payment of all reinsurance premiums and other charges in arrears; but in
the event of such reinstatement, Reinsurer shall have no liability in
connection with any claims incurred between the date of

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 5 -
TREATY NO. 103049
<PAGE> 6
termination and the date of reinstatement of the reinsurance without prior
written consent of the Reinsurer.

D. Not withstanding termination of reinsurance as provided herein, NASL shall
continue to be liable to Reinsurer for all unpaid reinsurance premiums
earned by Reinsurer under this Agreement. Such premiums are subject to an
annual interest charge as specified in Article XIX.

ARTICLE VII - CLAIMS

NASL is solely responsible for payment of its claims under the Policies
identified on Schedule B.

NASL shall provide written notice to Connecticut General of any Claim which may
impact the reinsurance coverage under this Agreement within thirty (30) calendar
days of receipt of notification of Claim. NASL shall also provide prompt notice
to Connecticut General of all subsequent significant developments relating to
such Claim. Inadvertent oversight or omission in the provision of such notice
shall not relieve Connecticut General of liability provided NASL informs
Connecticut General of such oversight or omission promptly upon its discovery.

NASL shall provide Connecticut General with proof of claim, proof of claim
payment and any other claim documentation requested by Connecticut General in
accordance with Schedule E. Payment of reinsurance shall be made by Connecticut
General in one sum regardless of the method of payment by NASL and within thirty
(30) calendar days following receipt of required claim documentation.

NASL shall notify Connecticut General of its intention to contest or deny a
claim which may involve the reinsurance coverage under this Agreement before any
notice of contest or denial is provided to the claimant. Connecticut General
shall then have thirty (30) calendar days within which to advise NASL whether it
agrees that the claim should be contested or denied. If Connecticut General does
not agree that the claim should be contested or denied, then it shall pay to
NASL the full amount of the reinsurance on the risk reinsured, as set forth in
this Agreement, and Connecticut General shall have no further obligation in
respect to such claim. If Connecticut General agrees that the claim should be
contested or denied, then Connecticut General shall pay its share of the
following in accordance with its share of liability as set forth in this
Agreement:

- Expenses incurred by NASL in investigating, contesting litigating or
otherwise resisting the Claim, excluding salaries and expenses of
employees, officers and agents of NASL and ordinary expenses of NASL,
and costs of third party administrators acting on behalf of NASL; and

- Interest which is paid by NASL in respect of the Claim.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 6 -
TREATY NO. 103049
<PAGE> 7
If the denial of a Claim results in an award verdict or judgment against NASL,
where Connecticut General has agreed with the claim denial and NASL intends to
appeal the verdict or judgment, written notice of the intention to appeal shall
be provided to Connecticut General. Connecticut General shall be entitled at
that time to pay its share of the judgment, together with any expenses and
interest as set forth above, and to have no further obligation in connection
with such Claim. If Connecticut General does not pay its share of the judgment
and any expenses and interest due at that time, Connecticut General shall pay
its share of the expenses associated with the appeal of the judgment or verdict,
together with its share of any additional interest charges that may accrue
during the appeal.

ARTICLE VIII - RESERVES

The reserve held by Connecticut General for reinsurance of the variable annuity
death benefit will be determined in accordance with the NAIC Actuarial Guideline
XXXIV, but in no event less than the recognized statutory required reserve.

ARTICLE IX - EXTRA CONTRACTUAL OBLIGATIONS

A. In no event shall Connecticut General be liable for extra contractual
damages (whether they constitute Compensatory damages, Statutory
penalties, Exemplary or Punitive damages) which are awarded against NASL
as a result of an act, omission or course of conduct by NASL in connection
with policies subject to this Agreement, unless Connecticut General shall
have received notice in writing of and concurred with the actions taken or
not taken by NASL which led to its liability, in which case Connecticut
General shall pay its share of such liability. For this purpose,
Connecticut General's share shall be proportionate with its risk under the
business reinsured hereunder.

B. The following definitions shall apply:

(1) Punitive damages and Exemplary damages are those damages awarded as a
penalty, the amount of which is not governed nor fixed by statute.

(2) Statutory penalties are those amounts which are awarded as a penalty
but fixed in amount by statute.

(3) Compensatory damages are those amounts awarded to compensate for the
actual damages sustained and are not awarded as a penalty nor fixed in
amount by statute.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 7 -
TREATY NO. 103049
<PAGE> 8
ARTICLE X - LITIGATION

In the event of any action brought against NASL under any Underlying Annuity
Contract that is subject to the terms and conditions of this Agreement, NASL
shall provide a copy of such action and written notice of such action within ten
(10) business days to Connecticut General. If Connecticut General is a party to
action brought against NASL, NASL shall seek agreement by Connecticut General on
the selection and appointment of local counsel to represent NASL in such action.

ARTICLE XI - OFFSET

Either party shall have, and may exercise at any time and from time to time, the
right to offset any balance or amounts whether on account of premiums or on
account of losses or otherwise, due from one party to the other under the terms
of this Agreement. However, in the event of insolvency of NASL subject to the
provisions of Article XVI, offset shall only be allowed in accordance with the
statutes and/or regulations of the state having jurisdiction over the
insolvency.

ARTICLE XII - ACCESS TO RECORDS

NASL and Connecticut General, or its duly authorized representative, shall have
access at any reasonable time during regular business hours, to all records of
the other, including the right to photocopy and retain copies of such documents,
which reasonably pertain in any way to this Agreement. Books and records shall
be maintained in accordance with prudent standards of insurance company record
keeping and must be retained for a period of at least seven (7) years from the
date of creation. Within one hundred and fifty (150) days following the end of
each calendar year, NASL and Connecticut General will provide each office with
copies of their respective audited financial statements.

NASL and Connecticut General may come into the possession or knowledge of
Confidential Information of the other in fulfilling obligations under this
Agreement. Each party agrees to hold such confidential information in the
strictest confidence and to take all reasonable steps to ensure that such
Confidential Information is not disclosed in any form by any means by each of
them or by any of its employees to third parties of any kind, other than
attorneys, accountants, other consultants or retrocessionairs having an interest
in such information, except by advance written authorization by an officer of
the authorizing party; provided, however, that either party will be deemed to
have satisfied its obligations as to the Confidential Information by protecting
its confidentiality in the same manner that such party protects its own
proprietary or confidential

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 8 -
TREATY NO. 103049
<PAGE> 9
information of like kind which shall be at least a reasonable manner.
"Confidential Information" means any information which (1) is not generally
available to or known by the public, or (2) has not been lawfully obtained or
developed by either party independently and not in violation of this Agreement
or from any source other than the other party, provided that such source is not
bound by a duty of confidentiality to such other party, and which consists of:

A. Information or knowledge about each party's products, processes, services,
finances, customers, research, computer programs, marketing and business
plans, claims management practices; and

B. Any medical or other personal, individually identifiable information about
people or business entities with whom the parties do business, including
customers, prospective customers, vendors, suppliers, individuals covered
by insurance plan, and each party's producers and employees.

ARTICLE XIII - DELAYS, ERRORS OR OMISSIONS

No accidental delay, errors or omissions on the part of NASL shall relieve
Connecticut General of liability provided immediate notice of such delay, errors
or omissions is provided to Connecticut General and are rectified as soon as
possible after discovery. However, Connecticut General shall not be liable with
respect to any reinsurance which may have been inadvertently included in the
premium computation but which ought not to have been included by reason of the
terms and conditions of this Agreement. Such inadvertent premium payments shall
be returned. Adjustment(s) of premiums payable and claims incurred as a result
of delay, errors or omissions shall be limited to the year in which they are
discovered and the calendar year prior to such discovery.

It is expressly understood and agreed that if failure to comply with any terms
of this Agreement is shown to be unintentional or the result of a
misunderstanding or oversight on the part of either party, both parties shall be
restored to the position they would have occupied had no such error or oversight
occurred, subject always to the correction of the error or oversight.

ARTICLE XIV - CURRENCY

All retentions and limits hereunder are expressed in United States dollars and
all premium and loss payments shall be made in United States currency. For the
purposes of this Agreement, amounts paid or received by Connecticut General in
any other currency shall be converted into United States dollars at the rates of
exchange on the date such transactions are entered on the books of Connecticut
General.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 9 -
TREATY NO. 103049
<PAGE> 10
ARTICLE XV - HOLD HARMLESS

A. Connecticut General shall indemnify and hold NASL harmless from any and all
liability, loss, damage, fines, punitive damages, penalties and costs,
including expenses and attorney's fees, which results from any negligence
or willful misconduct of Connecticut General in fulfilling its duties and
obligations under this Agreement or which results from any action which
exceeds its authority under this Agreement.

B. NASL shall indemnify and hold Connecticut General harmless from any and all
liability, loss, damage, fines, punitive damages, penalties and costs,
including expenses and attorney's fees, which results from any negligence
or willful misconduct of NASL in fulfilling its duties and obligations
under this Agreement or which results from any action which exceeds its
authority under this Agreement.

ARTICLE XVI - INSOLVENCY

In the event of insolvency of NASL, the reinsurance under this Agreement shall
be payable directly by Connecticut General to NASL or to its liquidator,
receiver, conservator or statutory successor on the basis of Connecticut
General's liability to NASL without diminution because of the insolvency of NASL
or because the liquidator, receiver, conservator or statutory successor of NASL
has failed to pay all or a portion of any claim. It is agreed, however, that the
liquidator, receiver, conservator or statutory successor of NASL shall give
prompt written notice to Connecticut General of the pendency of a claim against
NASL within a reasonable time after such claim is filed in the receivership,
conservation, insolvency or liquidation proceeding and that during the pendency
of such claim, Connecticut General may investigate such claim and interpose, at
its own expense, in the proceeding where such claim is to be adjudicated, any
defense or defenses that it may deem available to NASL or its liquidator,
receiver, conservator or statutory successor. The expense thus incurred by
Connecticut General shall be chargeable, subject to the approval of the Court,
against NASL as part of the expense of conservation or liquidation to the extent
of a pro-rata share of the benefit which may accrue to NASL solely as a result
of the defense undertaken by Connecticut General.

Where two or more reinsurers are involved in the same claim and a majority in
interest elect to interpose defense to such claim, the expense shall be
apportioned in accordance with the terms of this Agreement as though such
expense had been incurred by NASL.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 10 -
TREATY NO. 103049
<PAGE> 11
ARTICLE XVII - ARBITRATION

A. As a condition precedent to any right of action hereunder, any dispute
between the parties with respect to the interpretation of this Agreement or
any right, obligation or liability of either party, whether such dispute
arises before or after termination of this Agreement, shall be submitted to
arbitration upon the written request of either party. Each party shall
select an arbitrator within thirty (30) days of the written request for
arbitration. If either party refuses or neglects to appoint an arbitrator
within thirty (30) days of the written request for arbitration, the other
party may appoint the second arbitrator. The two arbitrators shall select
an umpire within thirty (30) days of the appointment of the second
arbitrator. If the two arbitrators fail to agree on the selection of the
umpire within thirty (30) days of the appointment of the second arbitrator,
each arbitrator shall submit to the other a list of three umpire
candidates, each arbitrator shall select one name from the list submitted
by the other and the umpire shall be selected from the two names chosen by
a lot drawing procedure to be agreed upon by the arbitrators.

B. The arbitrators and the umpire all shall be active or retired,
disinterested executive officers of insurance or reinsurance companies.

C. The arbitration panel shall interpret this Agreement as an honorable
engagement rather than merely as a legal obligation and shall make its
decision considering the custom and practice of the applicable insurance
and reinsurance business. The arbitration panel is released from judicial
formalities and shall not be bound by strict rules of procedure and
evidence.

D. The decision of the arbitration panel shall be final and binding on both
parties. The arbitration panel may, at its discretion, award costs and
expenses as it deems appropriate, including, but not limited to, attorneys'
fees, interest and punitive damages. Judgment may be entered upon the final
decision of the arbitration panel in any court of competent jurisdiction.

E. All meetings and hearings before the arbitration panel shall take place in
Worcester, Massachusetts unless some other place is mutually agreed upon by
both parties or ordered by the panel.

F. In the absence of a decision to the contrary by the arbitration panel, each
party shall bear the expense of its own arbitrator and shall jointly and
equally bear with the other party the expense of the umpire and of the
arbitration.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 11 -
TREATY NO. 103049
<PAGE> 12
ARTICLE XVIII - DAC TAX REGULATION ELECTION

Connecticut General and NASL hereby agree to make an election pursuant to
Internal Revenue Code Regulation Section 1.848-2(g)(8). This election shall be
effective for all taxable years for which the Reinsurance Agreement remains in
effect.

The terms used in this article are defined by reference to Regulation Section
1.848-2 promulgated on December 28, 1992.

Connecticut General and NASL agree that the entity with net positive
consideration for the reinsurance agreement for each taxable year will
capitalize specified policy acquisition expenses with respect to the reinsurance
agreement without regard to the general deductions limitation of Section
848(c)(1) of the Internal Revenue Code of 1986, as amended.

Connecticut General and NASL agree to exchange information pertaining to the
amount of net consideration under the reinsurance agreement each year to ensure
consistency. To achieve this, NASL shall provide Connecticut General with a
schedule of its calculation of the net consideration for all reinsurance
agreements in force between them for a taxable year by no later than April 30 of
the succeeding year. Connecticut General shall advise NASL if it disagrees with
the amounts provided by no later than May 31, otherwise the amounts will be
presumed correct and shall be reported by both parties in their respective tax
returns for such tax year. If Connecticut General contests NASL'S calculation of
the net consideration, the Parties agree to act in good faith to resolve any
differences within thirty (30) days of the date Connecticut General submits its
alternative calculation and report the amounts agreed upon in their respective
tax returns for such tax year.

Connecticut General represents and warrants that it is subject to U.S. taxation
under either Subchapter L or Subpart F of Part III of Subchapter N of the
Internal Revenue Code of 1986, as amended.

ARTICLE XIX EFFECTIVE DATE; TERM AND TERMINATION

A. The effective date of this Agreement is July 1, 1997. This Agreement
remains effective for all annuity contracts subject to this Agreement
written by NASL through June 30, 1998, unless terminated pursuant to the
paragraphs listed below:

B. Either Connecticut General or NASL shall have the option of terminating
this agreement with one hundred and eighty (180) days written notice to the
other party for new business anytime on or after June 30, 1998.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 12 -
TREATY NO. 103049
<PAGE> 13
C. Once each calendar year, NASL shall have the option to recapture existing
contracts beginning with the fifteenth (15) anniversary of their
reinsurance hereunder. If NASL elects to recapture, 1/3 of the contracts
can be recaptured in the first year eligible, 1/2 of the remaining
contracts can be recaptured in the second year, and the balance of the
contracts can be recaptured in the third year. Recapture must be made on an
issue year basis beginning with the earliest issue year. Recapture cannot
occur on contracts with later issue years until all contracts with earlier
issue dates have been recaptured.

D. Upon delivery of sixty (60) days written notice to NASL, Connecticut
General shall have the option of terminating this Agreement for new
business within sixty (60) days of the happening of any of the following
events:

(1) NASL's A. M. Best rating is reduced to a "C" or lower.

(2) NASL's parent company is placed upon a "watch list" by its domiciliary
state's insurance regulators;

(3) An order appointing a receiver, conservator or trustee for management
of NASL is entered or a proceeding is commenced for rehabilitation,
liquidation, supervision or conservation of NASL;

(4) NASL is merged, purchased or there is any other material change in the
NASL organization which directly impacts the reinsurance coverage
provided in this Agreement;

(5) The Securities and Exchange Commission revokes the licenses of NASL to
conduct business.

E. Connecticut General shall have the option of terminating this Agreement for
new and existing business should NASL fail to pay premium in accordance
with Article V and VI. If, during the sixty (60) days notice period, the
Reinsurer receives all premiums in arrears and all premiums which may
become due within the sixty (60) days notice period, the notice of
termination shall be deemed withdrawn. In the event of termination under
this paragraph, this Agreement may be reinstated upon the written consent
of the Reinsurer if, at any time within sixty (60) days of termination,
NASL pays and the Reinsurer receives all premiums due with interest thereon
and payable up to the date of reinstatement. (Please refer to paragraph K
below for the interest calculation description)

F. Upon delivery of sixty (60) days written notice to Connecticut General,
NASL shall have the option of terminating this Agreement for new business
within sixty (60) days of the happening of any of the following events:

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 13 -
TREATY NO. 103049
<PAGE> 14
(1) Connecticut General's A. M. Best rating is reduced to a "C" or lower;

(2) Connecticut General is placed upon a "watch list" by its domiciliary
state's insurance regulators;

(3) An order appointing a receiver, conservator or trustee for management
of Connecticut General is entered or a proceeding is commenced for
rehabilitation, liquidation, supervision or conservation of
Connecticut General;

(4) Connecticut General is merged, purchased or there is any other
material change in Connecticut General's organization which directly
impacts the reinsurance coverage provided in this Agreement;

(5) Failure by Connecticut General to pay reinsurance death benefits in
accordance with Article II. If, during the sixty (60) days notice
period, NASL receives all reinsurance death benefits in arrears, the
notice of termination shall be deemed withdrawn. In the event of
termination under this paragraph, this Agreement may be reinstated
upon the written consent of NASL if, at any time within sixty (60)
days of termination, the Reinsurer pays and NASL receives all
reinsurance death benefits due with interest thereon and payable up to
the date of reinstatement. (Please refer to paragraph K below for the
interest calculation description)

G. If this Agreement is terminated for new and existing business, Connecticut
General shall be relieved of all liability to NASL for claims incurred
following the termination date of this Agreement under such Underlying
Annuity Contracts issued by NASL, and

H. If this Agreement is terminated for new business only, Connecticut General
will remain liable, after termination, in accordance with the terms and
conditions of this Agreement, with respect to all reinsurance effective
prior to termination of the Agreement.

I. Both parties shall continue to be entitled to all offset credits provided
by Article XI up to the effective date of termination.

J. NASL shall not have the right to assign or transfer any portion of the
rights, duties and obligations of NASL under the terms and conditions of
this Agreement without the written approval of Connecticut General.

K. In the event of reinstatement as described in paragraph E and F above,
there will be an interest charge at the three (3) month LIBOR Rate (as
published in the Wall Street Journal), plus .01, determined on the first
business day following the end of the 60 day notice period. The settlement
is considered overdue at the end of the 60 day notice period and interest
shall commence from the overdue date.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 14 -
TREATY NO. 103049
<PAGE> 15
ARTICLE XX - NOTICES

All notices required to be given hereunder shall be in writing and shall be
deemed delivered if personally delivered, sent via facsimile, or dispatched by
certified or registered mail, return receipt requested, postage prepaid,
addressed to the parties as follows:

Richard C. Hirtle
Vice President, Treasurer
North American Security Life Insurance Company
P.O. Box 9230
Boston, MA 02205-9230
Phone No. (617) 266-6008 (x253) Fax No. (617) 437-6849

Inger S. Harrington, FSA
Assistant Vice President and Actuary
CIGNA Reinsurance
800 Cottage Grove Road
Hartford, CT 06152-4026
Phone No. 860.726.4516 Fax No. 860.726.3153

Notice shall be deemed given on the date it is received in the mail or sent via
facsimile in accordance with the foregoing. Any party may change the address to
which to send notices by notifying the other party of such change of address in
writing in accordance with the foregoing.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 15 -
TREATY NO. 103049
<PAGE> 16
The text of this Agreement and all Exhibits, Schedules and Amendments are
considered to be the entire contract between the parties. There are no other
understandings or agreements between the parties regarding the policies
reinsured other than as expressed in this Agreement. Either party may make
changes or additions to this Agreement, but they will not be considered to be in
effect unless they are made by means of a written amendment which has been
signed by both parties.

In witness whereof, the parties hereto have caused this Agreement to be signed
in duplicate on the dates indicated to be effective as of the date specified
above.

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY

By:______________________________

Date:______________________, 19__

CONNECTICUT GENERAL LIFE INSURANCE COMPANY

By:______________________________

Date:______________________, 19__

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 - 16 -
TREATY NO. 103049
<PAGE> 17
SCHEDULE A

Maximum Limits of Reinsurance in Connecticut General

Connecticut General requires prior notification of any annuity purchase in
excess of $5,000,000.00 per annuitant/owner. Upon receipt of such notification,
Connecticut General then has the obligation to notify NASL within 15 days of its
decision to accept or not accept the reinsurance risk for such an annuity
purchase. Should Connecticut General not respond within 15 days, it shall be
deemed that Connecticut General does not agree to accept such risk. In no event
shall Connecticut General's share of risk exceed $5,000,000 per contract without
prior written approval from Connecticut General.

The purchase amount is the sum of all premium contributions less withdrawals in
the contract. For purchase amounts in excess of the maximum, Connecticut
General's death benefit liability will be reduced by the ratio of purchase
amounts in excess of the maximum to the total purchase amounts.

Guaranteed Minimum Death Benefit

The Guaranteed Minimum Death Benefit (GMDB) reinsured hereunder shall be limited
to 50% of all new issues and shall be determined as follows:

The death benefit will be paid if the contract owner dies during the first nine
contract years and shall be the greater of:

(A) the contract value less any payment enhancements applied in the 12
month period prior to the date of death, or

(B) the excess of (i) the sum of all purchase payments less any payment
enhancements applied in the 12 month period prior to the date of death
over (ii) the sum of any amounts deducted in connection with partial
withdrawals.

The death benefit will be paid if the contract owner dies after the ninth
contract year and shall be the greater of:

(A) the contract value less any payment enhancements applied in the 12
month period prior to the date of death or

(B) the excess of (i) the sum of all purchase payments less any payment
enhancements applied over (ii) the sum of any amounts deducted for
partial withdrawals or

(C) the death benefit on the last day of the ninth contract year, plus the
sum of all purchase payments made and any amount deducted in
connection with partial withdrawals since then and less any payment
enhancements applied in the 12 month period prior to the date of
death.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 SCHEDULE A
TREATY NO. 103049
<PAGE> 18
SCHEDULE B

Contracts and Funds Subject to this Reinsurance Agreement

<TABLE>
<CAPTION>
Form
Number* Policy Description Date
- ------- ------------------ ----

<S> <C> <C>
VTG20.PRO797 Venture Vantage, Combination Fixed 7/23/97
and Variable Annuity
</TABLE>

* Includes all state variations

<TABLE>
<CAPTION>
Fund
Date Fund/Portfolio Description
- ---- --------------------------

<S> <C> <C>
Pacific Rim Emerging Markets Trust Equity-Income Trust
Science & Technology Trust Balanced Trust
International Small Cap Trust Aggressive Asset Allocation Trust
Emerging Growth Trust High Yield Trust
Pilgrim Baxter Growth Trust Moderate Asset Allocation Trust
Small/Mid Cap Trust Conservative Asset Allocation Trust
International Stock Trust Strategic Bond Trust
Worldwide Growth Trust Global Government Bond Trust
Global Equity Trust Capital Growth Bond Trust
Growth Trust Investment Quality Bond Trust
Equity Trust U.S. Government Securities Trust
Quantitative Equity Trust Money Market Trust
Equity Index Trust Lifestyle Aggressive 1000 Trust
Blue Chip Growth Trust Lifestyle Growth 820 Trust
Real Estate Securities Trust Lifestyle Balanced 640 Trust
Value Trust Lifestyle Moderate 460 Trust
International Growth and Income Trust Lifestyle Conservative 280 Trust
Growth and Income Trust
</TABLE>

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 SCHEDULE B
TREATY NO. 103049
<PAGE> 19
SCHEDULE C

Limits and Rules of NASL

1) NASL will determine the Guaranteed Minimum Death Benefit for each deceased
within seven (7) working days of receipt of written notice of death, as
well as all required claim forms.

2) The maximum purchase payment without company approval is $1,000,000.

3) The minimum initial purchase payment is $10,000.

4) The maximum maturity date is the first day of the month following the later
of the 85th birthday of the owner or the tenth contract anniversary.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 SCHEDULE C
TREATY NO. 103049
<PAGE> 20
SCHEDULE D
Reinsurance Premiums

1. The reinsurance premiums shall be based on the owner's age at the end of
each quarter. NASL shall determine the owner's age at the time it prepares
the quarterly exposure data submission for the variable annuity guaranteed
death benefit, as set forth in Schedule E, attached hereto.

2. The Adjusted Aggregate Contract Value is the sum of the contract values in
all of NASL'S variable annuities subject to this Agreement, minus contract
values attributable to amounts in excess of the maximum purchase amounts
listed in Schedule A.

3. The amount at risk each quarter will be calculated as the reinsurance death
benefit for each variable annuity contract covered under this agreement.
For determining the amount at risk, the guaranteed minimum death benefit
and the contract value are calculated as the average of the values at the
end of the current quarter and the end of the prior quarter. The amount at
risk cannot fall below zero

4. The premium over each calendar quarter will be no more than fifty (50)
percent of the Age Adjusted Aggregate Contract Values times one quarter
(1/4) of the maximum premium amount. The actual quarterly premium is a
fund/exposure based charge subject to a minimum or maximum determined as
basis points (bps) of account value. Fund based charges, expressed as an
annual rate are as follows:

<TABLE>
<CAPTION>
Reinsurance Attained Ages 0-69 Attained Ages 70+
Coverage Min. Max. Min. Max.
-------- ------------------- ------------------

<S> <C> <C>
Until Termination 1.2 bps - 5.2 bps 4.4 bps - 12.0 bps
</TABLE>

Quarterly Reinsurance Premium Rates
Exposure Based - Per $1,000 Exposed

<TABLE>
<CAPTION>
Ages Unisex
-----------
<S> <C>
less than 35 $ 0.19
35-39 0.25
40-44 0.37
45-49 0.63
50-54 1.15
55-59 2.02
60-64 3.21
65-69 5.52
70-74 9.54
75-79 15.40
80-84 25.20
85-89 38.20
</TABLE>

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 SCHEDULE D
TREATY NO. 103049
<PAGE> 21
SCHEDULE E

Quarterly Reporting Format

1. Following the end of each calendar quarter, the Quarterly Input Page,
Fund/Exposure-Based exhibit (Schedule E-2) and the Quarterly Transaction
Summary (Schedule E-1) or an exhibit of similar form must be prepared for
each Qualified plan and Non-Qualified plan separately.

2. The tabulation should be on an Adjusted Basis, which requires omission of
excess contract values due to an issue amount in excess of $5 million.

3. The tabulation is on a seriatim basis, with each contract contributing
toward the totals for both exposure and aggregate contract value.

4. The tabulation is necessary to assess the correct amount at risk for
accurate calculation of reinsurance premium. NASL can choose to report
values a) as weighted averages during the quarter, or b) as of the end of
the quarter. This election must be denoted on the submission.

5. At year end reporting, a tabulation of exposures by age based on a
percentage decrease in account value by fund type as specified by the NAIC
must be submitted for reserve purposes.

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

NO. AMERICAN SECURITY LIFE INS. COMPANY
VENTURE VANTAGE VARIABLE ANNUITY
EFFECTIVE JULY 1, 1997 SCHEDULE E
TREATY NO. 103049

<PAGE> 1
AUTOMATIC REINSURANCE AGREEMENT

Between

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY

(now known as the MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA)
Boston, Massachusetts

And

SWISS RE LIFE & HEALTH AMERICA INC.
New York, New York
<PAGE> 2

AUTOMATIC REINSURANCE AGREEMENT

Contents
--------

ARTICLE I Scope of Agreement
ARTICLE II Commencement & Termination of Liability
ARTICLE III Oversights - Clerical Errors
ARTICLE IV Mortality Net Amount At Risk
ARTICLE V Reinsurance Premiums
ARTICLE VI Experience Refund
ARTICLE VII Reinsurance Administration
ARTICLE VIII Settlement of Claims
ARTICLE IX Tax Credits
ARTICLE X Regulatory Compliance
ARTICLE XI Inspection of Records
ARTICLE XII Insolvency
ARTICLE XIII Arbitration
ARTICLE XIV Rights of Offsetting Balances Due
ARTICLE XV Contract and Program Changes
ARTICLE XVI Federal Taxes
ARTICLE XVII Parties to Agreement
ARTICLE XVIII Entire Agreement
ARTICLE XIX Duration of Agreement

Signature Page

EXHIBIT A - Variable Annuities Covered Under This Agreement
EXHIBIT B - Sub-Accounts
EXHIBIT C - Experience Refund and Loss Carryforward Definitions and Formulae

<PAGE> 3

AUTOMATIC REINSURANCE AGREEMENT

THIS AGREEMENT between the NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY (now
known as the MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA), a
corporation organized under the laws of the State of Delaware, hereinafter
referred to as the "Company", and SWISS RE LIFE & HEALTH AMERICA INC., a
corporation organized under the laws of the State of New York, hereinafter
referred to as "Swiss Re Life & Health", WITNESSETH AS FOLLOWS:

ARTICLE I

Scope of Agreement

1. On and after the 1st day of August, 1997, the Company will
automatically reinsure with Swiss Re Life & Health, and Swiss Re Life & Health
will automatically accept, a 50% quota share of the mortality net amount at
risk, as defined in Article IV, generated prior to annuitization or complete
surrender by the contract owner, by the Guaranteed Minimum Death Benefit
provisions within the variable annuity contracts issued by the Company as set
forth in Exhibit A.

2. Swiss Re Life & Health's maximum aggregate liability in any one
calendar year shall not exceed 3% (300 basis points) of Swiss Re Life &
Health's quota share percentage of the average aggregate account value over
each respective calendar year of coverage. This average shall be calculated by
totaling the aggregate account value as of the end of each calendar month and
dividing the result by the number of months.

3. Swiss Re Life & Health's maximum liability on any one life
reinsured hereunder shall be Two Million Dollars ($2,000,000) multiplied by the
quota share percentage reinsured by Swiss Re Life & Health specified in
paragraph 1 of this Article, and calculated as specified in Article IV of this
Agreement.

-1-

<PAGE> 4

4. This Agreement covers only the Company's liability for claims paid
under variable annuity contracts written on the contract forms specified in
Exhibit A and supported by sub-accounts which were reviewed by Swiss Re Life &
Health prior to their issuance.

-2-

<PAGE> 5

ARTICLE II

Commencement & Termination of Liability

1. On reinsurance ceded under the terms of this Agreement, the
liability of Swiss Re Life & Health shall commence simultaneously with that of
the Company, and will terminate upon the earliest of re-registration,
annuitization, surrender or termination in accordance with Article XIX.
Re-registration is a term used to describe a process in which the Beneficiary
continues the Variable Annuity Contract as the new Owner upon death of the
original Owner.

2. Swiss Re Life & Health shall be liable to reimburse claims on only
those deaths where the date of death is on or after August 1, 1997, in
accordance with Article VIII.

-3-

<PAGE> 6

ARTICLE III

Oversights - Clerical Errors

1. Should either the Company or Swiss Re Life & Health fail to comply
with any of the terms of this Agreement, and if this is shown to be
unintentional and the result of a misunderstanding, oversight or clerical error
on the part of either the Company or Swiss Re Life & Health, then this
Agreement shall not be deemed abrogated thereby, but both companies shall be
restored to the position they would have occupied had no such oversight,
misunderstanding, or clerical error occurred. Such conditions are to be
reported and corrected promptly after discovery.

-4-

<PAGE> 7
ARTICLE IV

Mortality Net Amount At Risk
----------------------------

1. The mortality net amount at risk for each variable annuity contract
reinsured hereunder shall be calculated as of the last day of each calendar
month and shall be calculated as described below, except that the amount shall
not be less than zero and shall not be greater than the product of ($2,000,000)
per life and the quota share percentage reinsured by Swiss Re Life & Health.

VNAR = 50% of [(SA - Separate Account CSV) +
Max(0, Contractual GMDB - FA - SA)]

where:

SA = Separate Account Assets.

FA = Fixed Account Assets.

SC = Total surrender charges under all contracts
reinsured.

SASC% = SA/(SA + FA), an aggregate measure recalculated
monthly.

Separate Account CSV = SA - (SASC% * SC)

The contractual death benefit and the contract value shall be as described in
the variable annuity contract forms specified in Exhibit A.

-5-
<PAGE> 8
ARTICLE V

Reinsurance Premiums
--------------------

1. (a) Reinsurance premiums shall be calculated monthly. The initial
reinsurance premium shall be equal to the minimum monthly premium rate
as described in paragraph 1(b), below. Subsequent reinsurance premiums
shall be equal to 150% of the prior calendar month's death claim
reimbursement, subject to the minimum and maximum monthly premiums
stated in 1(b) and 1(c), below.

(b) The minimum monthly premium shall be equal to the product of the
current minimum monthly premium rate and Swiss Re Life & Health's quota
share percentage of the greater of the average aggregate account values
and the average aggregate GMDB over each calendar month of all variable
annuities reinsured hereunder.

The current minimum monthly premium rate shall be equal to

PRODUCT BASIS POINTS
One Time Nine (9) Year Ratchet 0.625
(until contract termination)

(c) The maximum monthly premium shall be equal to the product of the
current maximum monthly premium rate and Swiss Re Life & Health's quota
share percentage of the greater of the average aggregate account values
and the average aggregate GMDB over each calendar month of all variable
annuities reinsured hereunder.

The current maximum monthly premium rate shall be equal to

PRODUCT BASIS POINTS
One Time Nine (9) Year Ratchet 1.0417
(until contract termination)

- 6 -
<PAGE> 9
2. The total reinsurance premium shall be reduced by the ratio of:
the sum of the mortality net amounts at risk in excess of $1 million
on any lives reinsured hereunder multiplied by the quota share
percentage reinsured by Swiss Re Life & Health
to
the total mortality net amounts at risk on all variable annuity
contracts reinsured hereunder multiplied by the quota share percentage
reinsured by Swiss Re Life & Health.

3. The monthly reinsurance premium shall be due and payable on a calendar
quarterly basis as described in Article VII.

4. The reinsurance premium rates described above shall remain in effect as
long as the death benefit design, the contract fees, the mortality and expense
charges, the administration fees, and the surrender charges in effect at the
inception of this Agreement remain unchanged.

-7-

<PAGE> 10
ARTICLE VI

Experience Refund

1. Swiss Re Life & Health shall pay the Company an experience refund equal
to 50% of the Adjusted Profit, as defined in Exhibit C, for all variable
annuity contracts covered under this Agreement as set forth in Exhibit A.

2. The refund shall be calculated each calendar quarter by Swiss Re Life &
Health and settled annually by July 31st of each year.

-8-
<PAGE> 11
ARTICLE VII

Reinsurance Administration
--------------------------

1. Within 30 days of the end of each calendar quarter, the Company will
furnish Swiss Re Life & Health a separate electronic report for each Guaranteed
Minimum Death Benefit design specified in Exhibit A, valued as of the last day
of that calendar quarter. Each report will indicate for all inforce annuities
reinsured hereunder:

a) Annuitant's name, sex, date of birth and social security
number

b) Owner's name, sex, date of birth and social security number

c) Contract number

d) Contract issue date

e) Contract form number

f) Current contract separate account value

g) Current contract value fixed account value

h) Cumulative net considerations

i) Current contract minimum guaranteed death benefit

j) Current contract death benefit

k) Current contract cash surrender value

l) Current variable net amount at risk

2. Additionally, within 30 days of the end of each calendar quarter, the
Company will furnish Swiss Re Life & Health a separate paper report for each
GMDB design and tax status combination specified in Exhibit A, summarizing the
following data:

a) Reinsurance premiums due Swiss Re Life & Health

b) Death claim reimbursements due the Company

c) Total number of contracts reinsured

d) Total current contract separate account value

e) Total current fixed account value

- 9 -
<PAGE> 12
f) Total cumulative net considerations

g) Total current guaranteed minimum death benefit

h) Total current death benefit

i) Total current cash surrender value

j) Total current variable risk amount

3. If the net balance is due Swiss Re Life & Health, the amount due
shall be remitted with the report statement. If the net balance is due the
Company, Swiss Re Life & Health shall remit the amount to the Company within 10
days of the receipt of the report.

-10-
<PAGE> 13
ARTICLE VIII

Settlement of Claims

1. The claims that are eligible for reimbursement are only those that the
Company is required to pay on deaths that occur on or after the effective date
of this Agreement.

2. In the event the Company provides satisfactory proof of claim to Swiss
Re Life & Health, claim settlements made by the Company shall be unconditionally
binding on Swiss Re Life & Health.

3. The death claim reimbursed by Swiss Re Life & Health shall be
determined as of the date due proof of death is received at the Company's
Annuity Service office.

4. Within 30 days of the end of each calendar quarter, the Company shall
notify Swiss Re Life & Health of the reinsured death benefits paid in that
calendar quarter and Swiss Re Life & Health will reimburse the Company, as
provided in Article VII, for the reinsured benefits.

5. Settlements by Swiss Re Life & Health shall be in a lump sum
regardless of the mode of payment made by the Company to the beneficiary.

-11-
<PAGE> 14
ARTICLE IX

Tax Credits

1. Swiss Re Life & Health shall not reimburse the Company for state
premium taxes.

-12-

<PAGE> 15
ARTICLE X

Regulatory Compliance

1. Swiss Re Life & Health agrees to comply with all regulatory
directives required to permit the Company to receive statutory reserve credit
for the reinsurance ceded under this Agreement.

2. The Company warrants that it has secured all necessary federal
and state licenses and approvals, and that it is operating in compliance with
federal investment laws and state investment and insurance laws and regulations.

-13-

<PAGE> 16
ARTICLE XI

Inspection of Records

1. Swiss Re Life & Health shall have the right at all reasonable
times and for any reasonable purpose to inspect at the office of the Company
all records referring to reinsurance ceded to Swiss Re Life & Health.

2. Likewise, the Company shall have the right at all reasonable
times and for any reasonable purpose to inspect at the offices of Swiss Re Life
& Health all records pertaining to reinsurance ceded to Swiss Re Life & Health
by the Company. Swiss Re Life & Health shall also provide reasonable access,
during regular business hours, to records pertaining to such reinsurance to any
regulator having authority over the Company's products and operations.

-14-

<PAGE> 17
ARTICLE XII

INSOLVENCY

1. In the event of the insolvency of the Company, all reinsurance made,
ceded, renewed or otherwise becoming effective under this Agreement shall be
payable by Swiss Re Life & Health directly to the Company or to its liquidator,
receiver, or statutory successor on the basis of the liability of the Company
under the contract reinsured without diminution because of the insolvency of the
Company. It is understood, however, that in the event of the insolvency of the
Company, the liquidator, receiver or statutory successor of the insolvent
Company shall give written notice of the pendency of a claim against the
insolvent Company on the policy reinsured within a reasonable time after such
claim is filed in the insolvency proceeding and that, during the pendency of
such claim, Swiss Re Life & Health may investigate such claim and interpose, at
its own expense, in the proceeding where such claim is to be adjudicated, any
defense or defenses which it may deem available to the Company or to its
liquidator, receiver or statutory successor.

2. It is further understood that the expense thus incurred by Swiss Re Life
& Health shall be chargeable, subject to court approval, against the insolvent
Company as part of the expense of liquidation to the extent of a proportionate
share of the benefit which may accrue to the Company solely as a result of the
defense undertaken by Swiss Re Life & Health. Where two or more assuming
insurers are involved in the same claim and a majority in interest elect to
interpose defense to such claim, the expense shall be apportioned in accordance
with the terms of this Reinsurance Agreement as though such expense had been
incurred by the Company.

3. In the event of the insolvency of Swiss Re Life & Health and the
appointment of receivers therefor, the liability of Swiss Re Life & Health shall
not terminate but shall continue with respect to the reinsurance ceded to Swiss
Re Life & Health by the Company prior to the date of such insolvency or
appointment, and the Company shall have a security interest in any and all sums
held by or under deposit in the name of Swiss Re Life & Health.

-15-

<PAGE> 18
ARTICLE XIII

ARBITRATION

1. In the event of any difference arising hereafter between the contracting
parties with reference to any transaction under this Agreement, the same shall
be referred to three arbitrators who must be current or former executive
officers of life insurance or life reinsurance companies other than the two
parties to this Agreement or their affiliates, each of the contracting companies
to appoint one of the arbitrators and such two arbitrators to select the third.
If either party refuses or neglects to appoint an arbitrator within 60 days
after receipt of the written request for arbitration, the other party may
appoint a second arbitrator.

2. If the two arbitrators fail to agree on the selection of a third
arbitrator within 60 days of their appointment, each of them shall name three
individuals, of whom the other shall decline two, and the decision shall be made
by drawing lots.

3. The arbitrators shall consider this Reinsurance Agreement not merely as
a legal document but also as a gentlemen's agreement. In resolving the dispute,
the arbitrators will give full consideration to the customs and practices of the
life insurance and life reinsurance industry, insofar as they are not in
conflict with the specific terms of this Agreement. The arbitrators shall decide
by a majority vote. There shall be no appeal from their written decision.

4. Unless the arbitrators decide otherwise, each party shall bear the
expense of its own arbitration, including its arbitrator and outside attorney
fees, and shall jointly and equally bear with the other party the expense of
the third arbitrator. Any remaining costs of the arbitration proceedings shall
be apportioned by the Board of Arbitrators.

-16-

<PAGE> 19
ARTICLE XIV

Right of Offsetting Balances Due
--------------------------------

1. The Company and Swiss Re Life & Health shall have, and may exercise at
any time, the right to offset any balance or balances due one party to the
other, its successors or assigns, against balances due the other party under
this Agreement or under any other Agreements or Contracts previously or
subsequently entered into between the Company and Swiss Re Life & Health. This
right of offset shall not be affected or diminished because of insolvency of
either party to this Agreement.

- 17 -
<PAGE> 20
ARTICLE XV

Contract and Program Changes
----------------------------

1. The Company may amend, substitute, add or delete variable investment
funds to the separate accounts supporting the annuity contract as described in
the contract general provisions. No such change will be made by the Company
without prior notification to Swiss Re Life & Health and without the prior
approval of the Securities and Exchange Commission, if necessary. The Company
agrees to maintain at all times a satisfactory selection of core investment
options with characteristics similar to those listed in Exhibit B.

2. The Company will also give Swiss Re Life & Health advance notice of
any other changes to its annuity product design, its fees and charges, its
distribution systems and/or methods, or the addition of any riders to any
contract form reinsured hereunder.

3. Should any such change result in a material increase in the reinsured
net amount at risk and/or material decrease in the reinsurance premiums due,
Swiss Re Life & Health shall have the right to modify any of the terms of this
Agreement.

- 18 -
<PAGE> 21
ARTICLE XVI

Federal Taxes

1. The Company and Swiss Re Life & Health hereby agree to the following
pursuant to Section 1.848-2(g)(8) of the Income Tax Regulation issued December
1992, under Section 848 of the Internal Revenue Code of 1986, as amended. This
election shall be effective as of the Effective Date of this Agreement and for
all subsequent taxable years for which this Agreement remains in effect.

(a) The term "party" will refer to either the Company or Swiss Re
Life & Health, as appropriate.

(b) The terms used in this Article are defined by reference to
Regulation 1.848-2 in effect December 1992.

(c) The party with the net positive consideration for this Agreement
for each taxable year will capitalize specified policy
acquisition expenses with respect to this Agreement without
regard to the general deductions limitation of Section 848(c)(1).

(d) Both parties agree to exchange information pertaining to the
amount of net consideration under this Agreement each year to
ensure consistency or as otherwise required by the Internal
Revenue Service.

(e) The Company will submit a schedule to Swiss Re Life & Health by
May 1 of each year of its calculation of the net consideration
for the preceding calendar year. This schedule of calculations
will be accompanied by a statement stating that the Company will
report such net consideration in its tax return for the preceding
calendar year.

(f) Swiss Re Life & Health may contest such calculation by providing
an alternative calculation to the Company by June 1. If Swiss Re
Life & Health does not so notify the Company, the Company will
report the net consideration as determined by the Company in the
Company's tax return for the previous calendar year.

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<PAGE> 22

(g) If Swiss Re Life & Health contests the Company's
calculation of the net consideration, the parties will
act in good faith to reach an agreement as to the
correct amount by July 1. If the Company and Swiss Re
Life & Health reach agreement on an amount of the net
consideration, each party shall report such amount in
their respective tax returns for the previous calendar
year.

2. Swiss Re Life & Health and the Company represent and warrant
that they are subject to U.S. taxation under Subchapter L of Chapter 1 of the
Internal Revenue Code.

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<PAGE> 23
ARTICLE XVII

Parties to Agreement

1. This Agreement is an indemnity reinsurance agreement solely
between the Company and Swiss Re Life & Health. The acceptance of reinsurance
hereunder shall not create any right or legal relation whatever between Swiss
Re Life & Health and the annuitant, owner, beneficiary or any other party under
any contracts of the Company which may be reinsured hereunder, and the Company
shall be and remain solely liable to such parties under such contracts
reinsured hereunder.

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<PAGE> 24
ARTICLE XVIII

Entire Agreement

1. This Agreement shall constitute the entire agreement between the
parties with respect to business reinsured hereunder. There are no
understandings between the parties other than as expressed in this Agreement
and any change or modification of this Agreement shall be null and void unless
made by amendment to the Agreement and signed by both parties.

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<PAGE> 25
ARTICLE XIX

Duration of Agreement

1. New business shall be ceded under this Agreement until August 1, 1998.
As of that date, the reinsurance facility may be renewed subject to mutually
acceptable terms.

2. Upon 180 days written notice, either the Company or Swiss Re Life &
Health may cancel this Agreement any time on or after the first anniversary of
this Agreement. Inforce business ceded hereunder shall not be affected if the
Company and Swiss Re Life & Health fail to reach acceptable terms for new
business.

3. Any time on or after the fifteenth anniversary of this Agreement, the
Company may, upon 90 days written notice, irrevocably elect to cancel the
reinsurance in force under this Agreement, provided the loss carryforward,
calculated as described in Exhibit C of this Agreement, is non-negative. Upon
election, the reinsurance shall be recaptured at a constant rate by reducing
the quota share percentage set forth in Article I, paragraph 1, by 1.4% per
month. The reduction shall begin in the month of election and continue for 36
consecutive months. The quota share percentage will then be equal to 0% and the
reinsurance ceded hereunder shall be fully recaptured and this Agreement shall
then be terminated.

4. Should the Company fail to pay reinsurance premiums when due, Swiss Re
Life & Health may give the Company thirty (30) days notice, after reinsurance
premiums are ninety (90) days or more in arrears, that reinsurance coverage on
the affected reinsurance is suspended. The reinsurance coverage will be
reinstated at the option of Swiss Re Life & Health upon receipt of all the
overdue premiums. However, Swiss Re Life & Health shall have no liability for
claims that occur during a period of suspension. Also, suspension of
reinsurance coverage shall not relieve the Company of liability for premiums
due Swiss Re Life & Health.

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<PAGE> 26
IN WITNESS WHEREOF, the Company and Swiss Re Life & Health have caused their
names to be subscribed and duly attested hereunder by their respective
Authorized Officers.

NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY
(now known as the MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA)

By:________________________________ Attest:________________________________

Title:_____________________________ Title:_________________________________

Date:______________________________ Date:__________________________________

SWISS RE LIFE & HEALTH AMERICA INC.

By:________________________________ Attest:________________________________

Title:_____________________________ Title:_________________________________

Date:______________________________ Date:__________________________________

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<PAGE> 27
EXHIBIT A

Variable Annuities Covered Under This Agreement

I. Contracts Covered:

The Venture Vantage Combination Fixed and Variable Annuity with One Time
Nine Year Ratchet Benefit.

Contract Form Number -- Venture APP 01, and all state variations
Product Code -- VTG20

II. Contract Issue Dates:

Contracts issued by the Company on and after August 1, 1997 and before
August 1, 1998.
<PAGE> 28
EXHIBIT B

Sub-Accounts

I. Trust Portfolio

Pacific Rim Emerging Markets Fund
Science & Technology Fund
International Small Cap Fund
Emerging Growth Fund
Pilgrim Baxter Growth Fund
Small/Mid Cap Fund
International Stock Fund
Worldwide Growth Fund
Global Equity Fund
Rosenberg Small Company Value Fund (available October 1, 1997)
Growth Fund
Equity Fund
Quantitative Equity Fund
Blue Chip Growth Fund
Real Estate Securities Fund
Value Fund
International Growth and Income Fund
Growth and Income Fund
Equity-Income Fund
Balanced Fund
Aggressive Asset Allocation Fund
High Yield Fund
Moderate Asset Allocation Fund
Conservative Asset Allocation Fund
Strategic Bond Fund
Global Government Bond Fund
Capital Growth Bond Fund
Investment Quality Bond Fund
U. S. Government Securities Fund
Money Market Fund
Lifestyle Aggressive 1000 Fund
Lifestyle Growth 820 Fund
Lifestyle Balanced 640 Fund
Lifestyle Moderate 460 Fund
Lifestyle Conservative 280 Fund
<PAGE> 29
EXHIBIT C
Experience Refund and Loss Carryforward
Definitions and Formulae

t = current month

q = current quarter

(sum symbol)AV(t) = Sum total of Swiss Re Life & Health's quota share
percentage of account values at end of month t

Avg. AV(t) = 50% of ((sum symbol)AV(t-1) + (sum symbol)AV(t))

(sum symbol)GMDB(t) = Sum total of Swiss Re Life & Health's quota share
percentage of guaranteed minimum death benefits at
end of month t

Avg. GMDB(t) = 50% of ((sum symbol)GMDB(t-1) + (sum symbol)GMDB(t))

APR = annualized premium rate for each product combination

MPR = Monthly premium rate for each product combination
= (APR divided by 12)

RP(t) = Reinsurance premiums due at end of month t
= 150% DBR(t-1), subject to:
Min. = MPR x Minimum multiple x greater of (Avg. AV(t))
or (100% of Avg. GMDB(t))
Max. = MPR x Maximum multiple x greater of (Avg. Av(t))
or (100% of Avg. GMDB(t))

Min. Multiple = 1.0000

Max. Multiple = 1.6667

RP(1) = MPR x greater of (Avg. AV(1.)) or (Avg. GMDB(1))

DBR(t) = Death benefit recoveries in month t
= Sum of individual reinsured variable net risk amounts
reimbursed upon death

DBR(o) = 0

AdjP(t) = Adjusted profit for all products reinsured hereunder
for month t
= RP(t) - DBR(t) - MEC(t) - CHGRES(t) + CFWD(t)
<PAGE> 30
EXHIBIT C, continued

AdjP(o) = 0

AdjP(y) = Adjusted profit for calendar year y

CHGRES(t) = Change in reinsurance reserves for month t

MEC(t) = Monthly expense charge for month t, applied to average
aggregate account value over the month
= (2.0 basis points divided by 12) x Avg. AV(t)

CFWD(t) = Carryforward from month (t-1), adjusted for interest
= AdjP(t-1) x (1 + CIR(t))

When t = 13, 25, 37...., then CFWD(t)
= (AdjP(t-1) - Refund ((t-1)/12) x (1 + CIR(t))

CIR(t) = Carryforward interest rate for month t
= (Avg. U.S. Treasury bill rate for month t + 2.0%)
divided by 12

PR(y) = Payout ratio for year y
= 1.0 if AdjP(y) > 0, otherwise 0

Refund(y) = 50% of adjusted profit for year y, provided it is positive
= 50% x AdjP(y) x PR(y)