HANCOCK JOHN VARIABLE LIFE INSURANCE CO, POS AM, 1997-04-23

HANCOCK JOHN VARIABLE LIFE INSURANCE CO
POS AM, 1997-04-23

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<PAGE>

As filed with the Securities and Exchange Commission on April 22, 1997
Registration No. 33-64945

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

AMENDMENT NO. 1 TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

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

<TABLE>
<S> <C> <C>
MASSACHUSETTS 6311 04-2664016
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I. R. S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

200 CLARENDON STREET
BOSTON, MASSACHUSETTS 02117
(617) 572-4390
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

---------------
SANDRA M. DADALT, ESQUIRE
JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY
JOHN HANCOCK PLACE
BOSTON, MASSACHUSETTS 02117
(NAME, ADDRESS INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)

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

If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box: [X]

<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

CROSS REFERENCE SHEET

<TABLE>
<CAPTION>
Form S-1 Item Prospectus Caption
------------- ------------------

<C> <S>
1. Forepart of the Registration
Statement and Outside Front
Cover Page of Prospectus.............................Outside Front Cover Page

2. Inside Front and Outside Back
Cover Pages of Prospectus..................................Inside Front Cover

3. Summary Information, Risk
Factors and Ratio of Earnings to
Fixed Charges....................................Summary Information; The MVA
Fixed Account; Financial
Statements of the Company

4. Use of Proceeds.........................................The MVA Fixed Account

5. Determination of Offering Price................................Not Applicable

6. Dilution.......................................................Not Applicable

7. Selling Security Holders.......................................Not Applicable

8. Plan of Distribution............................Distribution of the Contracts

9. Description of Securities to be
Registered....................................The Contracts; The Accumulation
Period; The Annuity
Period
10. Interests of Named Experts and
Counsel........................................................Not Applicable

11. Information with Respect to the
Registrant..............................Further Information About the Company

12. Disclosure of Commission Position
on Indemnification for Securities
Act Liabilities................................................Not Applicable
</TABLE>
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

DEFERRED COMBINATION FIXED AND VARIABLE ANNUITY CONTRACTS

JOHN HANCOCK VARIABLE ANNUITY ACCOUNT JF

PROSPECTUS - May 1, 1997

The deferred annuity contracts described in this prospectus may be funded
by any one or more of the eleven subaccounts ("Subaccounts") of John Hancock
Variable Annuity Account JF ("Separate Account"), which is a separate investment
account of John Hancock Variable Life Insurance Company ("Company"), and by the
Market Value Adjustment Fixed Account ("MVA Fixed Account"). The contracts are
issued as group or individual contracts. An individual's interest in a group
contract is evidenced by the issuance of a separate certificate. In some states,
contracts are offered on an individual basis, with the issuance of an individual
contract. The certificates and individual contracts are collectively referred to
herein as the "Contracts."

The Contracts are designed to provide retirement benefits under tax
qualified plans, as well as under non-qualified arrangements. All funds
accumulate on a tax-deferred basis under the Contracts. You may elect a
variable return investment option through the Separate Account or a guaranteed
interest investment option through the MVA Fixed Account, or a combination of
these two options.

Under the variable return investment option, you can choose among one or
more of the following Subaccounts of the Separate Account: V.A. International,
V.A. Financial Industries Fund, V.A. Emerging Growth, V.A. Discovery, V.A.
Independence Equity, V.A. Sovereign Investors, V.A. 500 Index, V.A. Sovereign
Bond, V.A. Strategic Income, V.A. World Bond, and V.A. Money Market. The assets
of each Subaccount will be invested in a corresponding series, or "Fund," of the
John Hancock Declaration Trust ("Trust"), a mutual fund advised by John Hancock
Advisers, Inc. ("Adviser"). The prospectus for the Trust accompanies this
prospectus, and describes the investment objectives, policies and risks of the
Trust.

Under the MVA Fixed Account guaranteed interest investment option, you can
choose among various available Guarantee Periods, each of which has its own
interest rate and expiration date. Amounts allocated to the MVA Fixed Account
are credited with interest at a fixed rate for the entire Guarantee Period. A
Market Value Adjustment, or "MVA," positive or negative, may be made upon
annuitization or any withdrawal, surrender or transfer prior to the last day of
any Guarantee Period.

Currently, the number of investment options that may be selected to fund
the Contracts is limited to 18.

This prospectus sets forth information about the Contracts that a
prospective investor ought to know before investing. A statement of additional
information ("SAI") for the Separate Account, dated May 1, 1997 has been
filed with the Securities and Exchange Commission ("Commission") and is
incorporated herein by reference. The SAI, the table of contents of which
appears at page __ of this prospectus, is available without charge upon written
or oral request made to the Company's Servicing Office at the address or
telephone number below.

THIS PROSPECTUS SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE. IT IS NOT
VALID UNLESS ACCOMPANIED BY THE CURRENT PROSPECTUS FOR THE TRUST.

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

INTERESTS IN THE CONTRACTS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR INSURED,
ENDORSED, OR GUARANTEED BY THE U.S. GOVERNMENT, ANY BANK, THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, ENTITY OR
PERSON, AND INVOLVE INVESTMENT RISKS INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.

Servicing Office

John Hancock Servicing Center
P.O Box 9298
Boston, Massachusetts 02205-9298

TELEPHONE 800-824-0335

<PAGE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C>
SPECIAL TERMS..................................................... 4
SYNOPSIS OF EXPENSE INFORMATION................................... 6
SUMMARY INFORMATION............................................... 10
SEPARATE ACCOUNT FINANCIAL INFORMATION............................ 15
THE COMPANY AND JOHN HANCOCK...................................... 15
THE SEPARATE ACCOUNT.............................................. 15
THE TRUST......................................................... 16
THE MVA FIXED ACCOUNT............................................. 17
Guaranteed Rates/Guarantee Periods............................... 17
Market Value Adjustment.......................................... 18
Investments by the Company....................................... 19
CHARGES UNDER THE CONTRACTS....................................... 20
Charges For Mortality And Expense Risks.......................... 20
Charges for Administrative Services.............................. 20
Contingent Deferred Sales Load................................... 20
Nursing Home Waiver of CDSL Charge............................... 22
Optional Death Benefit Charges................................... 22
Variations in Charges............................................ 23
Premium or Similar Taxes......................................... 23
THE CONTRACTS..................................................... 24
Purchase of Contracts............................................ 24
Premium Payments by Wire......................................... 24
THE ACCUMULATION PERIOD........................................... 25
Allocation of Premium Payments................................... 25
Value of Accumulation Units...................................... 25
Determination of MVA Fixed Account Value......................... 25
Transfers Among Subaccounts and Guarantee Periods................ 25
Dollar-Cost Averaging............................................ 26
Surrender of Contract; Partial Withdrawals....................... 26
Systematic Withdrawal............................................ 27
Standard Death Benefit........................................... 27
Optional One Year Stepped-Up Death Benefit....................... 28
Optional Accidental Death Benefit................................ 28
Payment of Death Benefits........................................ 28
THE ANNUITY PERIOD................................................ 29
Variable Monthly Annuity Payments................................ 30
Fixed Monthly Annuity Payments................................... 30
Annuity Options.................................................. 31
Transfers........................................................ 31
Other Conditions................................................. 31
VARIABLE ACCOUNT VALUATION PROCEDURES............................. 32
MISCELLANEOUS PROVISIONS.......................................... 32
Restriction on Assignment........................................ 32
Deferment of Payment............................................. 33
Reservation of Rights............................................ 33
Owner and Beneficiary............................................ 33
</TABLE>

2
<PAGE>

<TABLE>
<S> <C>
FEDERAL INCOME TAXES.............................................. 34
The Separate Account, the MVA Fixed Account, and the Company..... 34
Contracts Purchased Other Than to Fund a Tax Qualified Plan...... 34
Diversification Requirements..................................... 35
Contracts Purchased to Fund a Tax Qualified Plan................. 35
Withholding of Taxes............................................. 38
See Your Own Tax Adviser......................................... 38
FURTHER INFORMATION ABOUT THE COMPANY............................. 38
Business of the Company.......................................... 38
Selected Financial Data.......................................... 39
Recent Accounting Developments................................... 40
Management's Discussion and Analysis of Financial Condition and
Results of Operations........................................... 40
Competition...................................................... 45
Employees and Facilities......................................... 45
Transactions with John Hancock................................... 45
Regulation....................................................... 45
Directors - Executive Officers................................... 47
Executive Compensation........................................... 48
SEPARATE ACCOUNT PERFORMANCE...................................... 48
REPORTS........................................................... 49
VOTING PRIVILEGES................................................. 49
CHANGES IN APPLICABLE LAW - FUNDING AND OTHERWISE................. 49
DISTRIBUTION OF THE CONTRACTS..................................... 50
AVAILABLE INFORMATION............................................. 50
EXPERTS AND FINANCIAL STATEMENTS.................................. 51
TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION.......... 51
FINANCIAL STATEMENTS OF THE COMPANY............................... F-1
APPENDIX A - SAMPLE MARKET VALUE ADJUSTMENT CALCULATIONS.......... Appendix A
APPENDIX B - VARIABLE ANNUITY INFORMATION FOR INDIVIDUAL
RETIREMENT ANNUITIES............................................. Appendix B
</TABLE>

THE CONTRACTS OFFERED BY THIS PROSPECTUS MAY NOT BE AVAILABLE IN ALL STATES.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO BUY, SECURITIES IN ANY STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO
MAKE OR SOLICIT AN OFFER IN THAT STATE.

3
<PAGE>

SPECIAL TERMS

As used in this prospectus, the following terms have the indicated
meanings:

ACCUMULATION PERIOD: the period referred to in the term "Accumulation Unit."

ACCUMULATION UNIT: a unit of measurement used in determining the value of an
Owner's interest in a Subaccount during the period prior to the commencement of
annuity payments or, if earlier, the surrender of the Contract. The value of an
Accumulation Unit will reflect the investment experience of the Subaccount and
vary in dollar amount.

ACCUMULATED VALUE: accumulated value of all Subaccounts and the MVA Fixed
Account Value under a Contract.

DATE OF MATURITY: the date elected by the Owner as of which annuity payments
will commence. The election is subject to certain conditions described in "The
Annuity Period." The Contract specifies a "Provisional Date of Maturity" as
discussed under "The Annuity Period."

ANNUITANT: the person designated in the Contract as such.

ANNUITY OPTION: the provisions under which a series of annuity payments is
made to the Annuitant or other payee, such as the Life Annuity with Ten Years
Certain.

ANNUITY UNIT: a unit of measurement used in determining the amount of any
variable annuity payment. The value of an Annuity Unit for each Subaccount will
depend upon the assumed investment rate and the investment experience of that
Subaccount, and will vary in dollar amount.

CONTRACT YEAR: the 12 month period following the date of issue of the Contract
and each 12 month period thereafter. In Certificates issued under group
Contracts, these periods are the "Certificate Year."

FIXED ANNUITY OPTION: an annuity option under which the Company promises to pay
the Annuitant, or any other payee designated by the Owner, fixed payments.

GENERAL ACCOUNT: comprises all assets of the Company other than those in the
Separate Account, and other than those in any other legally segregated separate
account established by the Company.

GUARANTEE PERIOD: the period for which a Guaranteed Rate is credited.

GUARANTEED RATE: the rate of interest credited during any Guarantee Period, on
an effective annual basis.

MARKET VALUE ADJUSTMENT: positive or negative adjustment to MVA Fixed Account
Value that is paid out at a time other than the last day of a Guarantee Period.

MVA FIXED ACCOUNT VALUE: the amount of premium payments allocated or transferred
to Guarantee Periods, plus interest and any positive Market Value Adjustment,
less any withdrawals including CDSLs and deductions for Contract fees, charges
and any premium or similar taxes and any negative Market Value Adjustment.

4
<PAGE>

OWNER: the person or entity, usually the one to whom the Contract is issued,
who has the sole right to exercise all rights and privileges under the Contract
except as otherwise provided in the Contract. As used in this prospectus, Owner
includes the "Participant" referred to in Certificates under Contracts issued on
a group basis.

SURRENDER VALUE: the amount that is payable upon a surrender of the Contract
prior to the Date of Maturity. Surrender Value is equal to the Accumulated
Value of a Contract after all applicable adjustments and deduction of all
applicable charges.

VARIABLE ANNUITY OPTION: an annuity option under which the Company makes to the
Annuitant, or any other payee designated by the Owner, payments which vary in
amount in accordance with the net investment experience of the Subaccounts
selected by the Owner. Not all of the Subaccounts are available under the
Contracts during the annuity period.

WE, US, OUR: mean the Company.

YOU, YOUR: mean the Owner.

5
<PAGE>

SYNOPSIS OF EXPENSE INFORMATION

The purpose of this synopsis is to provide an understanding of the various
costs and expenses that the Owner will bear directly or indirectly. The
synopsis includes expenses of the Separate Account and the Trust. For a more
complete description of the fees and charges applicable under the Contracts, see
"Charges Under the Contracts." The management fees charged the Funds and their
annual operating expenses are more fully described in the prospectus for the
Trust.

CONTRACT OWNER TRANSACTION EXPENSES

CONTINGENT DEFERRED SALES LOAD (or "CDSL," as a percentage of premium payments
withdrawn in excess of the Free Withdrawal Value) /1/

<TABLE>
<CAPTION>
YEARS FROM DATE OF
PREMIUM PAYMENT TO CDSL
DATE OF SURRENDER OR WITHDRAWAL PERCENTAGE
------------------------------- ----------

<S> <C>
7 or more ....................................................................... 0%
6 but less than 7 ............................................................... 2%
5 but less than 6 ............................................................... 3%
4 but less than 5 ............................................................... 4%
3 but less than 4 ............................................................... 5%
2 but less than 3 ............................................................... 5%
less than 2 ..................................................................... 6%

ANNUAL CONTRACT FEE /2/ ............................................................ $30
</TABLE>

SEPARATE ACCOUNT ANNUAL EXPENSES (as a percentage of Account Value)

<TABLE>
<CAPTION>
Initial Premium Payment
-----------------------
Less than $250,000
$250,000 or More
-------- --------

<S> <C> <C>
Mortality and Expense Risk Charge ................................... 0.90% 0.90%
Administration Charge ............................................... 0.35% 0.10%
----- -----
Total 1.25% 1.00%
==== ====
</TABLE>

__________________________________

/1/In any Contract Year an Owner may withdraw, without a CDSL, an amount equal
to 10% of the Accumulated Value as of the beginning of the Contract Year less
any prior withdrawals, during the Contract Year. This is the "Free Withdrawal
Value."

/2/The annual Contract Fee is deducted on Contracts having an Accumulated Value
of less than $10,000. The Contract Fee is deducted at the beginning of each
Contract Year after the first and at a full surrender during a Contract Year.
The Contract Fee is assessed only during the Accumulation Period, and is
referred to as the "Certificate Fee" in Certificates issued under group
Contracts. The Company reserves the right to increase the annual Contract Fee up
to $50, subject to applicable state regulations.

6
<PAGE>

TRUST ANNUAL EXPENSES (as a percentage of average net daily assets)

<TABLE>
<CAPTION>
MANAGEMENT OTHER TOTAL FUND
FUND FEES EXPENSES/1/ EXPENSES
---- ------- -------- --------
<S> <C> <C> <C>

John Hancock V.A. International Fund 0.90% 0.25% 1.15%

John Hancock V.A. Financial Industries Fund 0.80% 0.25% 1.05%

John Hancock V.A. Emerging Growth Fund 0.75% 0.25% 1.00%

John Hancock V.A. Discovery Fund 0.75% 0.25% 1.00%

John Hancock V.A. Independence Equity Fund 0.70% 0.25% 0.95%

John Hancock V.A. Sovereign Investors Fund 0.60% 0.25% 0.85%

John Hancock V.A. 500 Index Fund/2/ 0.10% 0.25% 0.35%

John Hancock V.A. Sovereign Bond Fund 0.50% 0.25% 0.75%

John Hancock V.A. Strategic Income Fund 0.60% 0.25% 0.85%

John Hancock V.A. World Bond Fund 0.75% 0.25% 1.00%

John Hancock V.A. Money Market Fund 0.50% 0.25% 0.75%
</TABLE>

_____________________

/1/ Other Fund expenses are based on estimates for the current fiscal year.

/2/ Reflects the Adviser agreement to limit the management fee it receives from
the John Hancock V.A. 500 Index Fund. Absent this fee limitation, the
management fee would be 0.35% of the Fund's average daily net assets and
total fund expenses would be 0.60% of the Fund's average daily net assets.
The Adviser reserves the right to terminate this management fee limitation
in the future.

EXAMPLES

If you surrender your Contract at the end of the applicable time period,
you would pay the following current expenses on a $1,000 investment allocated to
one of the Subaccounts listed, assuming 5% annual return on assets:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>
V.A. INTERNATIONAL........................................ 79 121
V.A. FINANCIAL INDUSTRIES ................................ 78 118
V.A. EMERGING GROWTH...................................... 77 117
V.A. DISCOVERY............................................ 77 117
V.A. INDEPENDENCE EQUITY.................................. 77 115
V.A. SOVEREIGN INVESTORS.................................. 76 112
V.A. 500 INDEX............................................ 71 97
V.A. SOVEREIGN BOND....................................... 75 109
V.A. STRATEGIC INCOME..................................... 76 112
V.A. WORLD BOND........................................... 77 117
V.A. MONEY MARKET......................................... 75 109
</TABLE>

7
<PAGE>

If you annuitize at the end of the applicable time period, or if you do not
surrender your Contract, you would pay the following current expenses on a
$1,000 investment allocated to one of the Subaccounts listed, assuming 5% annual
return on assets:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>

V.A. INTERNATIONAL.......................................... 25 77
V.A. FINANCIAL INDUSTRIES................................... 24 74
V.A. EMERGING GROWTH........................................ 23 72
V.A. DISCOVERY.............................................. 23 72
V.A. INDEPENDENCE EQUITY.................................... 23 71
V.A. SOVEREIGN INVESTORS.................................... 22 68
V.A. 500 INDEX.............................................. 17 52
V.A. SOVEREIGN BOND......................................... 21 65
V.A. STRATEGIC INCOME....................................... 22 68
V.A. WORLD BOND............................................. 23 72
V.A. MONEY MARKET........................................... 21 65
</TABLE>

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

The annual Contract Fee reflected in the examples has been expressed as an
annual percentage of assets based on the Company's experience with other
variable annuity contracts using the same contract fee provision.

The examples do not give effect to any premium taxes that may be
applicable, or to any of the charges described under "Optional Benefit Riders,"
below. The examples should not be considered representations of past or future
expenses; actual expenses may be greater than or less than those shown above.

OPTIONAL BENEFIT RIDERS

The Company offers, subject to state availability, three optional
benefit riders that may be elected by the Owner. A separate monthly charge
is made for each rider selected. The charge, as applicable, is made pro-rata
based on relative values through a reduction in Accumulation Units of the
Subaccounts and dollar amounts in the Guarantee Periods under a Contract.

The applicable charge is equal to the Accumulated Value at the beginning of
each month multiplied by 1/12th of the following annual percentage rates. With
respect to the Nursing Home Waiver of CDSL Rider, the applicable charge will be
assessed only upon the Accumulated Value associated with premium payments upon
which a CDSL would continue to be applicable at the time the charge is assessed.

<TABLE>
<S> <C>
ONE YEAR STEPPED-UP DEATH BENEFIT RIDER ............................................. 0.15%

ACCIDENTAL DEATH BENEFIT RIDER (terminates at age 80) ............................... 0.10%

NURSING HOME WAIVER OF CDSL RIDER ................................................... 0.05%
</TABLE>

For a description of these riders, see "One Year Stepped-Up Death Benefit
Rider" and "Accidental Death Benefit Rider" under "The Accumulation Period," and
"Nursing Home Waiver of CDSL Rider" under "Charges Under the Contracts."

8
<PAGE>

MARKET VALUE ADJUSTMENT AND CHARGES APPLICABLE TO THE MVA FIXED ACCOUNT

Except when effected on the last day of a Guarantee Period, surrenders,
transfers or partial withdrawals from the MVA Fixed Account, including amounts
withdrawn to provide an annuity or a death benefit, are subject to a Market
Value Adjustment that may increase or reduce the amount of MVA Fixed Account
Value paid out by the Company. The Market Value Adjustment is computed pursuant
to a formula that is described under "The MVA Fixed Account-Market Value
Adjustment." Of the expenses summarized above, only the "Contingent Deferred
Sales Load," "Annual Contract Fee," and "Optional Benefit Riders" charges are
applicable to the MVA Fixed Account.

JOHN HANCOCK VARIABLE ANNUITY ACCOUNT JF CONDENSED FINANCIAL INFORMATION

Selected data for each Accumulation Share outstanding throughout the period as
follows:

<TABLE>
<CAPTION>
Period from August 29, 1996
(Commencement of Operations)
to December 31, 1996
<S> <C>
V.A. International Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 11.23
Number of Accumulation Shares outstanding at end of period.... $ 1,149.67

V.A. Emerging Growth Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 9.30
Number of Accumulation Shares outstanding at end of period.... $ 4,393.62

V.A. Discovery Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 9.35
Number of Accumulation Shares outstanding at end of period.... $ 5,865.63

V.A. Independence Equity Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 11.13
Number of Accumulation Shares outstanding at end of period.... $ 2,759.86

V.A. Sovereign Investors Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 10.78
Number of Accumulation Shares outstanding at end of period.... $ 2,637.18

V.A. 500 Index Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 11.10
Number of Accumulation Shares outstanding at end of period.... $13,253.77

V.A. Sovereign Bond Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 10.51
Number of Accumulation Shares outstanding at end of period.... $ 1,170.22

V.A. Strategic Income Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 10.70
Number of Accumulation Shares outstanding at end of period.... $ 187.82

V.A. World Bond Subaccount

Accumulation share value:
Beginning of Period ................................... $ 10.00
End of Period ......................................... $ 10.46
Number of Accumulation Shares outstanding at end of period.... $ 96.28

V.A. Money Market Subaccount

Accumulation share value:
Beginning of Period ................................... $ 1.00
End of Period ......................................... $ 1.02
Number of Accumulation Shares outstanding at end of period.... $100,008.25
</TABLE>

9
<PAGE>

SUMMARY INFORMATION

The Contracts are designed for purchase by individuals doing their own
retirement planning, including plans and trusts that do not qualify for special
tax treatment under the Internal Revenue Code of 1986, as amended ("Code"), and
for purchase in connection with (1) pension and profit-sharing plans qualified
under Section 401(c) of the Code, known as "H.R. 10 plans," (2) pension or
profit-sharing plans qualified under Sections 401(a) or 403(a) of the Code,
known as "corporate plans," (3) plans qualifying under Section 401(k) of the
Code, (4) annuity purchase plans adopted under the provisions of Section 403(b)
of the Code by public school systems and certain other tax-exempt organizations,
and (5) individual retirement annuity plans satisfying the requirements of
Section 408 of the Code. For additional information pertaining to the purchase
of a Contract as an Individual Retirement Annuity, see "Appendix B - Variable
Annuity Information for Individual Retirement Annuities".

The John Hancock Servicing Center (the "Servicing Center") handles various
administrative, processing, servicing and similar functions related to the
Contracts. The Servicing Center may be reached at the address and telephone
number shown on the second page of this prospectus.

In order to accommodate "employer-related" plans funded by the Contracts,
Contract forms using "unisex" purchase rates, i.e., rates the same for males and
females, are available. Any questions you have as to whether you are
participating in an employer-related plan should be directed to your employer.
Any other question you or your employer may have with respect to this topic can
be directed to the Servicing Center.

THE CONTRACTS

The Contracts offered are "flexible premium" deferred annuity Contracts
under which premium payments may be made in a single sum or at intervals until
the Date of Maturity. At that time annuity payments by the Company will commence
unless the Owner elects to surrender the Contract, in which case, the Surrender
Value will be paid.

An application for a Contract is available from broker-dealers and certain
financial institutions who are participating in the distribution of the
Contracts. Applications are also available directly from the Company by
contacting the Servicing Center. Upon completion, the application is
transmitted, along with the premium payment, to the Servicing Center for
processing. See "The Contracts."

JOHN HANCOCK VARIABLE ANNUITY ACCOUNT JF

The Separate Account is a separate investment account of the Company. It is
operated as a unit investment trust and supports the variable benefits payable
under the Contracts. There are currently eleven Subaccounts within the Separate
Account: V.A. International, V.A. Financial Industries, V.A. Emerging Growth,
V.A. Discovery, V.A. Independence Equity, V.A. Sovereign Investors, V.A. 500
Index, V.A. Sovereign Bond, V.A. Strategic Income, V.A. World Bond, and V.A.
Money Market. Each Subaccount invests in a corresponding Fund of the Trust. The
Trust is a "series" type mutual fund.

Each Fund has a different investment objective. The Adviser provides
investment management services to the Funds for which it receives a fee from the
Trust. The Adviser utilizes sub-advisers for three of the Funds. John Hancock
Advisers International Limited ("JHAI") provides sub-investment management
services for the International Fund; Independence Investment Associates, Inc.
("IIA") provides sub-advisory services for the Independence Equity Fund; and
Sovereign Asset Management Corporation ("SAMCO") together with JHAI and IIA, the
"Sub-advisers") provides sub-advisory services for the Sovereign Investors Fund.
The Sub-advisers are indirect, wholly-owned subsidiaries of John Hancock Mutual
Life Insurance Company ("John Hancock"). Each

10
<PAGE>

Sub-adviser receives a fee from the Adviser for these services which in no way
increases the costs borne by the Trust, the Account, or the Owners.

For a more detailed description of the Trust, see its prospectus which
accompanies this prospectus.

MVA FIXED ACCOUNT INVESTMENT OPTIONS

Any amount allocated by the Owner to the MVA Fixed Account earns interest
at a Guaranteed Rate. The level of the Guaranteed Rate depends on the length of
the Guarantee Period selected by the Owner. We currently make available various
Guarantee Periods with durations of up to ten years.

If amounts are transferred, surrendered or otherwise paid out at any time
other than the last day of the applicable Guarantee Period, a Market Value
Adjustment will be applied that will increase or decrease the amount of MVA
Fixed Account Value paid out. Accordingly, the Market Value Adjustment can
result in gains or losses.

For a more complete discussion of the MVA Fixed Account investment options
and Market Value Adjustment, see "The MVA Fixed Account."

PRINCIPAL UNDERWRITER AND DISTRIBUTOR

John Hancock Funds, Inc. ("JHFI"), a registered broker-dealer affiliate of
John Hancock, acts as principal underwriter of the Account and principal
distributor of the Contracts. The Contracts are offered through broker-dealers
and financial institutions.

INVESTMENT OF PREMIUM PAYMENTS

Premium payments received under Contracts, after deduction of any premium
or similar taxes, are allocated to one or more of the Subaccounts and/or one or
more of the Guarantee Periods in the MVA Fixed Account, as directed by the
Owner.

Premium payments may be mailed to John Hancock Servicing Center, P.O. Box
9298, Boston, MA 02205-9298. All checks or other money orders should be made
payable to John Hancock. Procedures also have been established for the receipt
of premium payments by wire order. See "Payments by Wire" under "The
Contracts."

MINIMUM AND MAXIMUM PREMIUM PAYMENTS

Each premium payment must be at least $500. The total premium payments may
not exceed $1,000,000 in any Contract Year without our prior approval. No
premium payments may be made within six months prior to the Annuitant's 95th
birthday or thereafter. These limits may be waived by the Company.

11
<PAGE>

ACCOUNT CHARGES

Charges made directly to the Account include daily charges aggregating
0.90% annually for mortality and expense risks, and daily charges at the annual
rate of 0.35% and 0.10% under Contracts with initial premium payments of less
than $250,000 and $250,000 or more, respectively. These charges are based on the
average daily net asset value of each Subaccount, and reduce the unit values of
the Subaccounts.

FUND CHARGES

Management fees at annual rates currently ranging from 0.10% to 0.90% of
average daily net assets are paid by the Funds to the Adviser. The Funds also
incur charges for other expenses incurred in their operations. Management fees
and other expenses are reflected in the net asset value of each Fund's
shares.

WITHDRAWAL CHARGES

A withdrawal charge, or contingent deferred sales load (the CDSL), if
applicable, is deducted from the amount of any premium payment withdrawn from
the Accumulated Value under a Contract, including any partial withdrawal or any
full withdrawal upon a surrender of the Contract. The charge is 6% for
withdrawals made in the first two years from the date we receive a premium
payment and decreases decrementally to zero in the seventh year. The charge does
not apply to any premium payments withdrawn after seven years from the date we
receive the payments. In any Contract Year, up to 10% of the Accumulated Value
as of the beginning of the Contract Year, less any prior withdrawals during the
Contract Year, may be withdrawn without a CDSL. The CDSL also does not apply to
a withdrawal made to provide an annuity or a death benefit or, if necessary, to
meet minimum distribution requirements under qualified plans, or under the
waiver described in the next paragraph.

NURSING HOME WAIVER OF CDSL CHARGE

Subject to state availability, an optional "Nursing Home Waiver of CDSL"
rider may be elected at the time the Owner applies for a Contract. Under this
benefit, the CDSL, if otherwise applicable, will be waived on any withdrawals if
beginning at least 90 days after the date of issue, the Owner becomes confined
to a long term care facility ("LTCF") for at least 90 consecutive days, subject
to certain conditions. At the beginning of each month, we make a charge for this
rider equal to 1/12th of 0.05% (annual percentage rate) of the Accumulated Value
associated with premium payments upon which a CDSL would continue to be
applicable at the time the charge is assessed. The benefit is not available for
applicants over age 75.

CONTRACT FEE AND CERTAIN OTHER CHARGES

An annual Contract Fee of $30 is deducted during the Accumulation Period
under Contracts having an Accumulated Value of less than $10,000. The Company
reserves the right to increase the Contract Fee up to $50, subject to applicable
state regulations. No Contract Fee will be deducted if the Accumulated Value is
$10,000 or more. Charges also may be made for any taxes or interest expense
attributable to the Contracts or the Account.

Deductions are also made for any applicable premium or similar taxes based
on the amount of a premium payment. Currently, such taxes in certain states are
up to 5% of each premium payment. In addition, separate monthly charges are made
for the optional death benefit riders described under "Death Benefits" below.

A more detailed description of all fees and charges applicable under the
Contracts appears under "Charges

12
<PAGE>

Under the Contracts." Fees and charges of the Trust are described in its
prospectus which is attached to this prospectus.

WITHDRAWAL PRIOR TO DATE OF MATURITY

At any time before annuity payments begin, if the Annuitant is living, a
Contract may be surrendered in full for its Surrender Value or a portion of the
Accumulated Value may be withdrawn, subject to applicable charges and certain
limits. See "Surrender of Contract; Partial Withdrawals" under "The Contracts."
A 10% tax penalty may be applicable to withdrawals before the Owner attains age
59 1/2. A Market Value Adjustment may also be applied. See "The MVA Fixed
Account."

SYSTEMATIC WITHDRAWAL

The Accumulated Value of a Contract may be systematically withdrawn on a
monthly, quarterly, semi-annual or annual basis, as elected by the Owner.
Systematic withdrawals in any Contract Year in excess of 10% of the Accumulated
Value as of the beginning of the Contract Year may be subject to a CDSL. See
"Contingent Deferred Sales Load" under "Charges Under the Contracts." A
minimum Accumulated Value of $15,000 is required to start the program and
certain other conditions apply. See "Systematic Withdrawal" under "The
Accumulation Period."

DOLLAR COST AVERAGING

The Owner may elect to have amounts automatically transferred from the
Money Market Subaccount into one or more of the other Subaccounts of the
Account. Transfers of $250 or more may be made monthly, quarterly, semi-annually
or annually. A minimum Accumulated Value of $15,000 is required to start the
program. See "Dollar Cost Averaging" under "The Accumulation Period."

STANDARD DEATH BENEFIT

The Contracts include a standard death benefit payable upon the death of
the Annuitant prior to the Date of Maturity. The beneficiary will receive the
greater of (a) the Accumulated Value, adjusted by any Market Value Adjustment,
and (b) the aggregate amount of the premium payments made under the Contract,
less any prior withdrawals and CDSLs.

OPTIONAL ONE YEAR STEPPED-UP DEATH BENEFIT

At the time a Contract is applied for, the Owner may elect a one year
stepped-up death benefit rider designed to enhance the death benefit payable to
the beneficiary. Under this rider the benefit payable will be the greater of (a)
the standard death benefit, and (b) the highest Accumulated Value, adjusted by a
Market Value Adjustment, of the Contract as of any Contract anniversary
preceding the date of receipt of due proof of death together with any required
settlement instructions and preceding the Contract anniversary nearest the
Annuitant's 81st birthday, plus any premium payments, less any withdrawals and
CDSLs, since such Contract anniversary. See "Optional One Year Stepped-Up
Death Benefit" under "The Accumulation Period." At the beginning of each
month, we make a charge for this rider equal to 1/12th of 0.15% (annual
percentage rate) of the Accumulated Value of the Contract at that time. This
one year stepped up death benefit is not available for applicants age 80 or
older.

13
<PAGE>

OPTIONAL ACCIDENTAL DEATH BENEFIT

At the option of the Owner, an accidental death benefit rider may be
elected. Under this rider, upon the accidental death of the Annuitant prior to
the earlier of the Date of Maturity or the Annuitant's 80th birthday, the
beneficiary will receive, in addition to any other death benefit, an amount
equal to the Accumulated Value of the Contract, as of the date of receipt of
proof of the Annuitant's death, up to a maximum of $200,000. The benefit only
may be elected at the time the Contract is applied for, and is not available to
applicants age 80 or older. At the beginning of each month, we make a charge
for this rider equal to 1/12th of 0.10% (annual percentage rate) of the
Accumulated Value of the Contract at that time.

14
<PAGE>

THE COMPANY AND JOHN HANCOCK

The Company was organized under the laws of the Commonwealth of
Massachusetts in 1979 and commenced insurance operations in 1980. It is a
wholly-owned subsidiary of John Hancock, a mutual life insurance company
organized under the laws of the Commonwealth of Massachusetts in 1862. The
Company's Home Office is located at 200 Clarendon Street, Boston, Massachusetts
02117. See "Further Information About the Company."

John Hancock is a major financial services company. As the Company's
parent, it is anticipated that John Hancock will from time to time make capital
contributions to the Company to enable it to meet its reserve requirements and
expenses in connection with its business. John Hancock is committed to make
additional capital contributions if necessary to ensure that the Company
maintains a positive net worth.

THE SEPARATE ACCOUNT

The Separate Account is a separate account of the Company established under
Massachusetts law on November 13, 1995. The Separate Account, although an
integral part of the Company, meets the definition of a "separate account" under
the Federal securities laws and is registered as a unit investment trust under
the Investment Company Act of 1940, as amended ("1940 Act").

The Separate Account's assets are the property of the Company and the
obligations under the Contracts are the obligations of the Company. Each
Contract provides that the portion of the Separate Account's assets equal to the
reserves and other liabilities under the Contract with respect to the Separate
Account shall not be chargeable with liabilities arising out of any other
business the Company may conduct. In addition to the net assets and other
liabilities for Contracts, the Separate Account's assets include assets derived
from charges made by the Company and, possibly, funds contributed by the Company
to commence operation of the Subaccounts. From time to time these additional
assets may be transferred in cash by the Company to its general account. Before
making any such transfer, the Company will consider any possible adverse impact
the transfer might have on any Subaccount.

Income, gains and losses, whether or not realized, from assets allocated to
the Separate Account are, in accordance with the Contracts, credited to or
charged against the Separate Account without regard to other income, gains or
losses of the Company.

There currently are eleven Subaccounts in the Separate Account: the V.A.
International, V.A. Financial Industries, V.A Emerging Growth, V.A. Discovery,
V.A. Independence Equity, V.A. Sovereign Investors, V.A. 500 Index, V.A.
Sovereign Bond, V.A. Strategic Income, V.A. World Bond, and V.A. Money Market
Subaccounts. The assets in each Subaccount are invested in shares of a
corresponding Fund of the Trust. The assets of one Subaccount are not
necessarily legally insulated from liabilities associated with another
Subaccount. New subaccounts may be added and made available to Owners.

15
<PAGE>

THE TRUST

The Trust is a "series" type of mutual fund that is registered under the
1940 Act as an open-end diversified management investment company and organized
as a Massachusetts business trust. The Trust serves as an investment medium for
the Account and for John Hancock Variable Annuity Account H. In the future,
other unit investment trust separate accounts established by John Hancock, the
Company, or other unaffiliated life insurance companies for variable life
insurance policies and variable annuity contracts may also invest in the Trust.
A full description of the Trust, its investment objectives, policies and
restrictions, its charges and expenses, and all other aspects of its operation
is contained in its attached prospectus (which should be read carefully before
investing) and the SAI referred to therein, which should be read together with
this prospectus. Among other items, the description of the need to monitor
events on the part of the Trust's Board of Trustees for possible conflicts
between separate accounts and other consequences should be noted.

The following is a brief summary of the investment objectives of each Fund
of the Trust.

JOHN HANCOCK V.A. INTERNATIONAL FUND - seeks long-term growth of capital. The
Fund invests primarily in equity securities of foreign companies and
governments.

JOHN HANCOCK V.A. FINANCIAL INDUSTRIES FUND - seeks capital appreciation
primarily through investments in equity securities of financial services
companies throughout the world.

JOHN HANCOCK V.A. EMERGING GROWTH FUND - seeks long-term growth of capital.
The potential for growth of capital is the sole basis for selection of portfolio
securities. Current income is not a factor in this selection.

JOHN HANCOCK V.A. DISCOVERY FUND - seeks long-term growth of capital. The
Fund invests primarily in common stocks of companies of all levels of
capitalization which are believed by the Fund's managers to offer superior
prospects for growth. Current income is not a factor of consequence in the
selection of stocks for the Fund.

JOHN HANCOCK V.A. INDEPENDENCE EQUITY FUND - seeks above-average total
return, consisting of capital appreciation and income. The Fund will diversify
its investments to create a portfolio focused on stocks of companies that
management believes are undervalued and have improving fundamentals over both
the intermediate and long term.

JOHN HANCOCK V.A. SOVEREIGN INVESTORS FUND - seeks long-term growth of capital
and income without assuming undue market risks. At times, however, because of
market conditions, the Fund may find it advantageous to invest primarily for
current income. The Fund invests primarily in common stocks of seasoned
companies in sound financial condition with a long record of paying increasing
dividends.

JOHN HANCOCK V.A. 500 INDEX FUND - seeks to provide investment results that
correspond to the total return performance of the Standard & Poor's 500 Stock
Price Index ("S&P 500 Index"). The 500 Index Fund normally invests at least 80%
of the Fund's assets in common stocks of companies that comprise the S&P 500
Index in approximately the same proportions as they are represented in the
Index. (Requisite disclosure regarding the use of the Standard & Poor's name is
-----------------------------------------------------------------------
included in the Trust's prospectus attached at the end of this prospectus.)
- -------------------------------------------------------------------------

JOHN HANCOCK V.A. SOVEREIGN BOND FUND - seeks a high level of current income
consistent with prudent investment risk. The Fund invests primarily in a
diversified portfolio of investment grade fixed income securities of U.S. and
foreign issuers, although the Fund may invest up to 25% of its total assets in
lower-rated high-yield, high-risk fixed income securities.

16
<PAGE>

JOHN HANCOCK V.A. STRATEGIC INCOME FUND - seeks a high level of current
income. The Fund invests primarily in foreign government and corporate fixed
income securities, U.S. Government securities and lower-rated high-yield, high-
risk fixed income securities of U.S. issuers.

JOHN HANCOCK V.A. WORLD BOND FUND - seeks competitive total investment
return, consisting of current income and capital appreciation. The Fund invests
primarily in a global portfolio of high-grade, fixed income securities.

JOHN HANCOCK V.A. MONEY MARKET FUND - seeks maximum current income consistent
with capital preservation and liquidity. The Fund invests only in high-quality
money market instruments.

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

Prospective investors should carefully read the risk disclosures contained in
the Trust prospectus with regard to the investment risks of the high-yield,
high-risk fixed income securities invested in by the John Hancock V.A. Sovereign
Bond Fund and the John Hancock V.A. Strategic Income Fund.

The Company will purchase and redeem shares of the Trust for the Separate
Account at their net asset value without any sales or redemption charges. The
shares of the Trust represent an interest in the Funds that correspond to the
Subaccounts of the Separate Account. Any dividend or capital gains
distributions received by the Separate Account will be reinvested in shares of
the respective Funds at their net asset value as of the dates paid. Any such
distribution will result in a reduction in the value of the shares of the Fund
from which the distribution was made. However, the total net asset value of the
Separate Account, or of any Fund, will not change because of such distribution.

On each Valuation Date, shares of each Fund are purchased or redeemed by the
Company for each Subaccount based on, among other things, the amount of net
premium payments allocated to the Subaccount, dividends and distributions
reinvested, transfers to, from and among Subaccounts, all to be effected as of
that date. Such purchases and redemptions are effected at the net asset value
per share for each Fund determined on that same Valuation Date.

THE MVA FIXED ACCOUNT

The MVA Fixed Account is a "nonunitized" separate account established by the
Company. A nonunitized separate account is a separate account in which the
Contract Owner has no claim on, or participation in the performance of, the
assets held in the account. Investments purchased with amounts allocated to the
MVA Fixed Account are the property of the Company, and any favorable investment
performance on the assets held in the MVA Fixed Account accrues solely to the
Company's benefit. All benefits relating to the Accumulated Value of amounts
allocated to the MVA Fixed Account are guaranteed by the Company to the extent
provided under the Contracts.

GUARANTEED RATES/GUARANTEE PERIODS

Amounts allocated by the Owner to the MVA Fixed Account earn interest at a
Guaranteed Rate commencing with the date of allocation. The Guaranteed Rate
continues for a number of years, i.e., the Guarantee Period, selected by the
Owner. At the end of the Guarantee Period, the Accumulated Value in that
Guarantee Period, including interest accrued thereon, will be automatically
transferred to the Money Market Subaccount unless the Owner elects to: (a)
withdraw such Accumulated Value from the Contract, (b) allocate all or a portion
of the Accumulated Value to a new Guarantee Period of the same duration as the
expiring Guarantee Period, or (c) allocate all or any portion of the Accumulated
Value to a different Guarantee Period or periods or to one or more of the
Subaccounts. The Company must be notified of any election by the Owner at its
Servicing Center in a form satisfactory to it within 30 days prior to the end of
the expiring Guarantee Period. The first day of any new Guarantee Period or
other reallocation will be the day after the end of the prior Guarantee Period.
The Company will notify the Owner at least 30 days prior to the end of any
Guarantee Period. A Guarantee Period will not be available if it extends beyond
the Date of Maturity.

The Company currently makes available Guarantee Periods of various
durations. At any time, the Guarantee Periods may be one year and multiple year
periods of up to ten years. The Company reserves the right to add or delete
Guarantee Periods from those that are available at any time for new allocations.
Each

17
<PAGE>

Guarantee Period has its own Guaranteed Rate, which may differ from those for
other Guarantee Periods. We may, at our discretion, change the Guaranteed Rate
for future Guarantee Periods. These changes will not affect the Guaranteed
Rates being paid on Guarantee Periods that have already commenced. Each
allocation or transfer of an amount to a Guarantee Period commences the running
of a new Guarantee Period with respect to that amount, which will earn a
Guaranteed Rate that will continue unchanged until the end of that period.
Where required under state law, the Company will not make available any
Guarantee Period offering a Guaranteed Rate below 3%.

The Company declares the Guaranteed Rates from time to time as market
conditions and other factors dictate. The Company advises an Owner of the
Guaranteed Rate for a chosen Guarantee Period at the time a premium payment is
received, a transfer is effectuated or a Guarantee Period is renewed.

The Company has no specific formula for establishing the Guaranteed Rates
for the Guarantee Periods. The rates may be influenced by, but not necessarily
correspond to, interest rates generally available on the types of investments
acquired with amounts allocated to the Guarantee Period. See "Investments by the
Company," below. The Company, in determining Guaranteed Rates, may also
consider, among other factors, the duration of a Guarantee Period, regulatory
and tax requirements, sales and administrative expenses borne by the Company,
risks assumed by the Company, the Company's profitability objectives, and
general economic trends.

THE COMPANY'S MANAGEMENT MAKES THE FINAL DETERMINATION OF THE GUARANTEED RATES
TO BE DECLARED. THE COMPANY CANNOT PREDICT OR ASSURE THE LEVEL OF ANY FUTURE
GUARANTEED RATES.

Information concerning the Guaranteed Rates applicable to the various
Guarantee Periods, and the durations of the Guarantee Periods offered, at any
time may be obtained from the Company by calling JHISC at the telephone number
indicated on the cover page of this prospectus.

MARKET VALUE ADJUSTMENT

If any MVA Fixed Account Value is withdrawn, transferred or otherwise paid
out before the end of the Guarantee Period in which it is being held, a Market
Value Adjustment will be applied. This generally includes amounts that are paid
out as death benefits pursuant to the Contract, amounts applied to an annuity
option, and amounts paid as a single sum in lieu of an annuity. No Market Value
Adjustment will be applied to amounts that are paid out on the last day of a
Guarantee Period.

The Market Value Adjustment may increase or decrease the amount of MVA
Fixed Account Value being withdrawn, transferred or otherwise paid out. The
comparison of two Guaranteed Rates determines whether the Market Value
Adjustment produces an increase or a decrease. The first rate to compare is the
Guaranteed Rate for the existing Guarantee Period from which amounts are being
transferred or withdrawn. The second rate is the Guaranteed Rate then being
offered for new Guarantee Periods of the same duration as that remaining in the
existing Guarantee Period. If the first rate exceeds the second by more than
1/2%, the Market Value Adjustment produces an increase. If the first rate does
not exceed the second by at least 1/2%, the Market Value Adjustment produces a
decrease. Sample calculations are shown in Appendix A.

The Market Value Adjustment will be determined by multiplying the amount
being withdrawn or transferred from the Guarantee Period (before deduction of
any applicable CDSL) by the following factor:

n/12
1 + g
(-----------) -1
1 + c +.005
where,

18
<PAGE>

. g is the Guaranteed Rate in effect for the current Guarantee Period (in
decimal form).

. c is the current Guaranteed Rate (in decimal form) in effect for new
Guarantee Periods with durations equal to the number of years remaining
in the current Guarantee Period (rounded up to the nearest whole number
of years). If not available, the Company will declare a Guaranteed Rate
solely for this purpose that is consistent with interest rates for
Guarantee Periods that are currently available.

. n is the number of complete months from the date of withdrawal to the
end of the current Guarantee Period. (Where less than one complete month
remains, n will equal one unless the withdrawal is made on the last day
of the Guarantee Period, in which case no adjustment will apply.)

INVESTMENTS BY THE COMPANY

The Company's obligations with respect to the MVA Fixed Account are
supported by its General Account assets, which also support other general
obligations incurred by the Company. Subject to applicable law, the Company has
sole discretion over the investment of assets in the MVA Fixed Account and the
General Account, and neither account is subject to registration under the 1940
Act.

Amounts in the Company's General Account and the MVA Fixed Account will be
invested in compliance with applicable state insurance laws and regulations
concerning the nature and quality of investments for the General Account. See
the Company's Financial Statements for information on the Company's investments.
Investment management for amounts in the General Account and in the MVA Fixed
Account is provided to the Company by John Hancock.

The Company intends to consider the return available on the instruments in
which it intends to invest amounts allocated to the MVA Fixed Account when it
establishes Guaranteed Rates. Such return is only one of the factors considered
in establishing the Guaranteed Rates. See "Guaranteed Rates/Guarantee Periods,"
above.

The Company expects that amounts allocated to the MVA Fixed Account will be
invested according to its detailed investment policy and guidelines, in fixed
income obligations, including corporate bonds, mortgages, mortgage-backed and
asset-backed securities and government and agency issues having durations in
the aggregate consistent with those of the Guarantee Periods. JHVLICO intends to
invest proceeds from the Contracts attributable to the MVA Fixed Account
primarily in domestic investment-grade securities. In addition, derivative
contracts will be used only for hedging purposes, to reduce the ordinary
business risk of the Contracts associated with changes in interest rates, and
not for speculating on future changes in the financial markets. Notwithstanding
the foregoing, the Company is not obligated to invest amounts allocated to the
MVA Fixed Account according to any particular strategy. See "Management
Discussion and Analysis of Financial Condition and Results of Operations-
Reserves and Obligations" under "Further Information About the Company."

19
<PAGE>

CHARGES UNDER THE CONTRACTS

CHARGES FOR MORTALITY AND EXPENSE RISKS

While variable annuity payments to Annuitants will vary in accordance with
the investment performance of the Separate Account, the amount of such payments
will not be decreased because of adverse mortality experience of Annuitants as a
class or because of an increase in actual expenses of the Company over the
expense charges provided for in the Contracts. The Company assumes the risk that
Annuitants as a class may live longer than expected (necessitating a greater
number of annuity payments) and that its expenses may be higher than the
deductions for such expenses. The Company also provides a standard death benefit
and waives any CDSL upon the death of the Annuitant.

In return for the assumption of these mortality and expense risks, the
Company makes a daily charge to the assets of the Separate Account. The daily
charge is at the rate of 0.002466%, or 0.90% annually, of which 0.45% is for
mortality risks and 0.45%, for expense risks. The Company reserves the right to
revise the amounts of the charge as between mortality risks and expense risks,
should estimates change, but the aggregate charge will not exceed 0.90% on an
annual basis.

CHARGES FOR ADMINISTRATIVE SERVICES

The Company maintains an account for each Owner and Annuitant and makes all
disbursements of benefits. The Company also furnishes such administrative and
clerical services, including the calculation of Accumulation Unit values and the
values and interests determined thereby, as are required for each Subaccount.
The Company makes disbursements from Separate Account funds to pay obligations
chargeable to the Separate Account and maintains the accounts, records, and
other documents relating to the business of the Separate Account required by
regulatory authorities. These administrative services may be performed by the
Company or an authorized third party administrator. For these and other
administrative services, the Company makes a daily charge to the assets of the
Separate Account and assesses, during the Accumulation Period, a Contract Fee of
$30 on all Contracts having an Accumulated Value of less than $10,000. The
Contract Fee will be deducted at the beginning of each Contract Year after the
first and at a full surrender during a Contract Year. The Company reserves the
right to increase this fee up to a maximum of $50 subject to state regulations.
No Contract Fee will be deducted if the Accumulated Value is $10,000 or more.
The Contract Fee will be deducted from each Subaccount and each Guarantee Period
in the same proportion that the Accumulated Value in that Subaccount or
Guarantee Period bears to the full Accumulated Value.

The daily administrative charge is 0.000959%, or 0.35% on an annual basis,
under any Contract with an initial premium payment of less than $250,000; and
0.000274%, or 0.10% on an annual basis, under any Contract with an initial
premium payment of $250,000 or more. The different charges reflect the fact that
the cost of administering larger Contracts will tend to be smaller in proportion
to the Contract's Accumulated Value and that amounts realized by the Company
from expense charges made under smaller Contracts will be lower.

The administrative services charges are not designed, nor are they
expected, to exceed the Company's cost in providing these services.

CONTINGENT DEFERRED SALES LOAD

A contingent deferred sales load, or CDSL, may be assessed whenever a
Contract is surrendered for cash prior to the Date of Maturity ("total
withdrawal" or "surrender") or whenever an amount less than the total
Accumulated Value is withdrawn from a Contract prior to the Date of Maturity
("partial withdrawal"). This charge is used to help defray expenses relating to
the sales of the Contracts, including commissions paid and other distribution
costs.

20
<PAGE>

An Owner may withdraw in any Contract Year up to 10% of the Accumulated
Value as of the beginning of the Contract Year without the assessment of any
CDSL. This is the Free Withdrawal Value. If, in any Contract Year, the Owner
withdraws an aggregate amount in excess of 10% of the Accumulated Value as of
the beginning of the Contract Year, the amount withdrawn in excess of 10% is
subject to a CDSL to the extent that the excess is attributable to premium
payments made within seven years of the date of withdrawal or surrender.

No CDSL is assessed on amounts applied to provide an annuity or to pay a
death benefit. Also, no CDSL will apply to certain withdrawals if an Owner has
elected the nursing home waiver of CDSL rider described under "Nursing Home
Waiver of CDSL" below. Amounts withdrawn to satisfy the minimum distribution
requirements for tax qualified plans funded by a Contract are not subject to a
CDSL in any Contract Year. Amounts above the minimum distribution requirements
are subject to a CDSL if otherwise applicable.

The CDSL percentage charge depends upon the number of years that have
elapsed from the date of premium payment to the date of its withdrawal, as
follows:

<TABLE>
<CAPTION>
Years from Date
of Premium Payment to CDSL
Date of Surrender or Withdrawal Percentage
------------------------------- -----------

Whenever a CDSL is imposed, it is deducted from each Subaccount of the
Separate Account and each Guarantee Period of the MVA Fixed Account in the
proportion that the amount subject to the CDSL in each bears to the total amount
subject to the CDSL. In calculating the CDSL, all amounts withdrawn plus all
Contract Fees and CDSLs are assumed to be deducted first from the earliest
purchase payment, and then from the next earliest purchase payment, and so forth
until all payments have been exhausted, satisfying the first-in first out, or
"FIFO," method of accounting. The CDSL only applies to premium payments, not to
any earnings or appreciation. For a discussion of the taxation of partial
withdrawals, see "Contracts Purchased Other Than to Fund a Tax Qualified Plan"
under "Federal Income Taxes."

To the extent that any CDSL is applicable, the Accumulated Value will
generally be reduced by the amount of the CDSL, as well as by the actual dollar
amount of the withdrawal request. Any positive MVA will reduce the amount
deducted from the Accumulated Value by the amount of the positive MVA. Any
negative MVA will increase the amount deducted by the amount of the negative
MVA. The CDSL is calculated based upon the full amount by which the Accumulated
Value is reduced, adjusted for any MVA, and subject to the conditions noted
above.

For example, assume a Contract is issued on January 1, 1996, that the
Owner makes premium payments of $5,000 on January 1, 1996, $1,000 on
January 1, 1997, and $1,000 on January 1, 1998. Assume that the Accumulated
Value on January 1, 1999, is $9,000 and that a partial withdrawal is made
by the Owner in the amount of $6,000 (no tax withholding) on June 1, 1999.
The CDSL in this case, assuming no prior partial withdrawals, would equal
$272.23.

In calculating the CDSL under the FIFO method, the January 1, 1996,
$5,000 premium payment is first reduced by the three $30 Contract Fees
assessed on January 1, 1997, 1998, and 1999, i.e., to $4,910. Ten percent
of the Accumulated Value on January 1, 1999, i.e., $900, the free
withdrawal

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<PAGE>

amount, is then deducted leaving $4,010.

The remaining balance of the $5,000 January 1, 1996, premium payment,
i.e., $4,010, is then withdrawn in its entirety and is assessed a CDSL of
$200.50 (.05 x $4,010). All of the $1,000 January 1, 1997, premium payment
is to be withdrawn and is assessed a CDSL of $50 (.05 x $1,000). To make up
the remainder of the $6,000 paid to the Owner, $362.23 is withdrawn from
the January 1, 1998, premium payment. This is assessed a CDSL of $21.73
(.06 x $362.23).

Therefore, the total amount paid to the Owner is $6,000 and the total
CDSL is $272.23. The above example assumes all amounts withdrawn are after
the application of any Market Value Adjustment.

Withdrawals made prior to the Owner attaining age 59 1/2 may be subject to
certain adverse tax consequences. A Federal penalty of 10% is generally
applicable to the taxable portion (earnings) of a premature withdrawal from the
Contract. See "Penalty for Premature Withdrawals" under "Federal Income Taxes."

To the extent that the proceeds from the CDSLs may be insufficient to cover
distribution costs, the Company may recover them from its General Account assets
which may consist of, among other things, proceeds derived from mortality and
expense risk charges deducted from the Separate Account, and charges for the
optional benefits described in this prospectus.

NURSING HOME WAIVER OF CDSL

An optional Nursing Home Waiver of CDSL rider may be elected when the
Contract is applied for. Under this benefit, the CDSL, if otherwise applicable,
will be waived as to any withdrawals if, beginning at least 90 days after the
Contract date of issue, the Owner becomes confined to a nursing home facility
for at least 90 consecutive days and receives skilled nursing care. The Company
must receive a request for a withdrawal and adequate proof of confinement no
later than 90 days after discharge from the facility, and the confinement must
be prescribed by a physician and medically necessary. This rider is not
available to Contract applicants 75 years of age or older, or to applicants who
were confined to a nursing home within the prior two years. Reference should be
made to the rider for a complete description of its terms, conditions, and
benefits. At the beginning of each month, a charge equal to 1/12th of .05%
(annual percentage rate) is made against the Accumulated Value associated with
premium payments upon which a CDSL would continue to be applicable at the time
the charge is assessed. The charge is made through a pro-rata reduction in
Accumulation Units of the Subaccounts and dollar amounts in the Guarantee
Periods, based on relative values.

OPTIONAL DEATH BENEFIT CHARGES

Separate monthly charges are made for the optional One Year Stepped-Up
Death Benefit and Accidental Death Benefit riders offered by the Company. In
each case, the charge for the rider is made through a pro-rata reduction in
Accumulation Units of the Subaccounts and dollar amounts in the Guarantee
Periods, based on relative values. The charge, made at the beginning of each
month, is equal to the Accumulated Value at that time multiplied by 1/12th of
the following applicable annual percentage rates: One Year Stepped-Up Death
Benefit rider - 0.15%; Accidental Death Benefit rider - 0.10%. See "Optional One
Year Stepped-Up Death Benefit Rider" and "Optional Accidental Death Benefit
Rider" under "The Accumulation Period."

VARIATIONS IN CHARGES

In the future, the Company may allow a reduction in or the elimination of
the CDSL, the charge for the Nursing Home Waiver of CDSL rider, the charge for
expense risks, the administrative services charge, or the annual Contract Fee,
or the charge for the One Year Stepped-Up Death Benefit rider or

22
<PAGE>

Accidental Death Benefit rider, under Contracts sold to groups or classes of
individuals in a manner resulting in a reduction in the expenses associated with
the sale of such Contracts and the benefits offered, or the costs associated
with administering or maintaining the Contracts.

The entitlement to such a reduction in or elimination of charges and fees
will be determined by the Company based upon factors such as the following: (1)
the size of the initial premium payment, (2) the size of the group or class, (3)
the total amount of premium payments expected to be received from the group or
class and the manner in which premium payments are remitted, (4) the nature of
the group or class for which the Contracts are being purchased and the
persistency expected from that group or class as well as the mortality risks
associated with that group or class, (5) the purpose for which the Contracts are
being purchased and whether that purpose makes it likely that costs and expenses
will be reduced, or (6) the level of commissions paid to selling broker-dealers
or certain financial institutions with respect to Contracts within the same
group or class.

The Company will make any reduction in charges or fees according to its own
rules in effect at the time an application for a Contract is approved. The
Company reserves the right to change these rules from time to time. Any
variation in charges or fees will reflect differences in costs and services,
will apply uniformly to all prospective Contract purchasers in the group or
class, and will not be unfairly discriminatory to the interests of any Owner.

PREMIUM OR SIMILAR TAXES

Several states and local governments impose a premium or similar tax on
annuities. Currently, such taxes range up to 5% of the Accumulated Value applied
to an Annuity Option. Ordinarily, any state-imposed premium or similar tax will
be deducted from the Accumulated Value only at the time of annuitization.

For Contracts issued in South Dakota and Kentucky, the Company pays a tax
on each premium payment at the time it is made. The Company will deduct a charge
for these taxes from the Accumulated Value at the time of annuitization, death,
surrender, or withdrawal. Such a charge is equal to the applicable premium tax
percentage times the amount of Accumulated Value that is applied to an Annuity
Option, surrendered, withdrawn, or at death. The net economic effect of this
procedure is not significantly different than if the Company deducted the
premium tax from each premium payment when received.

________________________________

The charges described above (exclusive of taxes) and the Contracts' annuity
purchase rates will apply for the duration of each Contract and, except as noted
above, will not be increased by the Company. However, these charges do not
include all of the expenses which may be incurred for the account of Owners and
Annuitants. Additional charges will be made directly to the Separate Account for
taxes, if any, based on the income of, capital gains of, assets in, or the
existence of, the Separate Account and interest on funds borrowed. In addition,
the Company reserves the right to deduct premium taxes from premiums when paid.
Moreover, the Separate Account purchases and redeems shares of the Trust at net
asset value, a value which reflects the deduction from the assets of the Trust
of the applicable investment management fees and of certain operating expenses
listed under "Synopsis of Expense Information."

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<PAGE>

THE CONTRACTS

The descriptions herein are based on certain provisions of the Contracts.
Reference should be made to the actual Contracts and to the terms and
limitations of any tax qualified plan which is to be funded by such Contracts.
Tax qualified plans are subject to several requirements and limitations which
may affect the terms of any particular Contract or the advisability of taking
certain action permitted thereby.

PURCHASE OF CONTRACTS

Authorized representatives of the broker-dealer or financial institution
participating in the distribution of the Contracts will assist in the completion
of the application or the placing of an order for a Contract and will be
responsible for its transmittal, together with the necessary premium payment, to
the Servicing Center. If the application or order is complete and the Contract
applied for is suitable, the Contract will be issued and delivered to the Owner.
If the completed application or order is received in proper form, the initial
premium payment accompanying the completed application is applied within two
business days after receipt. If an initial premium payment is not applied within
five business days after receipt, it will be refunded unless the applicant
consents to the retention of the premium payment until receipt of information
necessary to allow the issuance of the Contract.

Each premium payment must be at least $500 in amount. The total premium
payments in any Contract Year may not exceed $1,000,000. The maximum dollar
amount of transfers and payments to any one Subaccount in a Contract Year is
$1,000,000. While the Annuitant is living and the Contract is in force, premium
payments may be made at any time before the Date of Maturity, except that no new
premium payments may be made after the Annuitant reaches age 94 1/2 under
Contracts funding non-qualified arrangements, or age 70 1/2 under tax qualified
plans. A Contract will not be issued if the proposed Annuitant is older than age
84. The foregoing limits may be waived by the Company.

All checks or other forms of premium payment must be made payable to John
Hancock.

PREMIUM PAYMENTS BY WIRE

The initial premium payment may be transmitted by wire order from broker-
dealers and financial institutions participating in the distribution of the
Contracts. Wire orders accepted by the Company will be invested in the
investment options selected by the prospective Owner at the value next
determined following receipt in good order. Wire orders must include information
necessary to allocate the payment among the investment options selected by the
prospective Owner. Wire orders not accompanied by complete information may be
held for up to five business days in order to obtain the missing information. If
that information is not obtained within the five business day period, the
Company will so advise the broker-dealer or financial institution involved and
return the premium payment immediately to the prospective Owner, unless he or
she consents to the retention of the premium payment by the Company until the
Company has received at its Servicing Center the information not provided. A
Contract will, nevertheless, not be issued, until the Company receives and
accepts a properly completed application. Until a signed application is received
and accepted, no further premium payments or other transactions will be allowed.

If within ten days of the receipt of the initial premium payment by wire a
completed application is not received or an incomplete application received
cannot be completed, the initial premium payment will be returned to the
prospective Owner.

After a Contract has been issued, subsequent premium payments may be
transmitted by wire through the Owner's bank. Information as to the name of the
Company's bank, our account number and the ABA routing number may be obtained by
calling the Servicing Center at the telephone number on the second page of this
prospectus. The

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<PAGE>

wire order must identify the Subaccounts and Guarantee Periods to which the
premium payment is to be allocated, and the dollar amount to be allocated to
each Subaccount and Guarantee Period. Banks may charge a fee for wire services.

THE ACCUMULATION PERIOD

ALLOCATION OF PREMIUM PAYMENTS

Premium payments are allocated by the Company to one or more of the
Subaccounts or Guarantee Periods, or among the Subaccounts and Guarantee
Periods, as specified by the Owner at the time of purchasing the Contract, and
as directed by the Owner from time to time thereafter. Any change in the
allocations will be effective as to premium payments made after the receipt by
JHISC of notice in form satisfactory to the Company.

Each premium payment allocated to a Subaccount purchases Accumulation Units
of that Subaccount at the value of such units next determined after the receipt
of such premium payment at the Servicing Center. See "Variable Account Valuation
Procedures."

Currently, premium payments may be allocated to a maximum of 18 Subaccounts
and Guarantee Periods.

VALUE OF ACCUMULATION UNITS

The number of Accumulation Units of a Subaccount purchased with a specific
premium payment will be determined by dividing the premium payment by the
value of an Accumulation Unit in that Subaccount when the premium payment is
applied. The value of the Accumulation Units so purchased will vary in amount
thereafter, depending upon the investment performance of the Subaccount and the
charges and deductions made against the Subaccount. At any date prior to the
Date of Maturity, the total value of the Accumulation Units in a Subaccount
which have been credited to a Contract can be computed by multiplying the number
of such Accumulation Units by the appropriate Accumulation Unit Value in effect
for such date.

DETERMINATION OF MVA FIXED ACCOUNT VALUE

A Contract's MVA Fixed Account Value is guaranteed by the Company. The
Company bears the investment risk with respect to amounts allocated to the MVA
Fixed Account, except that (a) the Company may vary the Guaranteed Rate for
future Guarantee Periods (subject to the 3% effective annual minimum guaranteed
rate where required under state law) and (b) the Market Value Adjustment
imposes investment risks on the Owner.

The Contract's MVA Fixed Account Value is the sum of the MVA Fixed Account
Values in each Guarantee Period on any date. The MVA Fixed Account Value in a
Guarantee Period is equal to the following amounts, in each case increased by
accrued interest at the applicable Guaranteed Rate:

. The amount of premium payments or transferred amounts allocated to
the Guarantee Period, including the amount of any positive Market Value
Adjustment; less

. The amount of any withdrawals, including any CDSLs, or transfers out of
the Guarantee Period; less

. The amount of any charges and fees deducted from that Guarantee Period;
less

. The amount of any negative Market Value Adjustment.

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<PAGE>

TRANSFERS AMONG SUBACCOUNTS AND GUARANTEE PERIODS

Not more than 12 times in each Contract Year the Owner may (a) transfer all
or any part of the Accumulation Units credited under a Contract from one
Subaccount to another Subaccount, or into a Guarantee Period or (b) transfer all
or any part of the dollar amount in one Guarantee Period to another Guarantee
Period, or to a Subaccount. However, transfers may not be made within 30 days of
the Date of Maturity, and transfers from one Subaccount or Guarantee Period to
another may not exceed $1,000,000 in value in any Contract Year. A transfer
pursuant to the dollar cost averaging feature discussed below does not count
toward the limitation of 12 transfers per Contract Year.

Transfers involving the Subaccounts will result in the redemption and/or
purchase of Accumulation Units on the basis of the respective unit values next
determined after receipt of notice satisfactory to the Company at the Servicing
Center. Transfers from a Guarantee Period before its expiration date are subject
to a Market Value Adjustment. The amount of any positive or negative Market
Value Adjustment will be added to or deducted from the transferred amount.

An Owner may request a transfer in writing or, if a telephone transfer
authorization is in effect, by telephoning 800-824-0335. The Owner may send a
written request to the Servicing Center at P.O. Box 9298 Boston, Massachusetts
02205-9298. Any written request should include the Owner's name, daytime
telephone number, and Contract number, and identify the Subaccounts or Guarantee
Periods from which and to which transfers are to be made. Transfers will be
effective on the date of receipt at the Servicing Center of a request in form
satisfactory to us. The Company reserves the right to modify, suspend, or
terminate telephone transfers at any time without notice to the Owners.

An Owner who authorizes telephone transfers will be liable for any loss,
expense or cost arising out of any unauthorized or fraudulent telephone transfer
instructions which the Company reasonably believes to be genuine, unless such
loss, expense or cost is the result of the Company's mistake or negligence. The
Company employs procedures which provide safeguards against the execution of
unauthorized transfers, and which are reasonably designed to confirm that
transfer instructions received by telephone are genuine. These procedures
include requiring personal identification, tape recording calls, and providing
written confirmation to the Owner.

DOLLAR COST AVERAGING

The Owner may elect to have automatically transferred on a monthly,
quarterly, semi-annual or annual basis, at no cost, Accumulation Units credited
to the Money Market Subaccount into one or more of the other Subaccounts. The
minimum amount of each transfer is $250. To begin the program, the Accumulated
Value must be at least $15,000. The program continues until it is discontinued
by the Owner, or the full liquidation of the Money Market Subaccount. Changes in
your dollar cost averaging instructions may be made by telephone or in writing
provided the telephone authorization option has been elected by the Owner. The
Company reserves the right to terminate the dollar cost averaging program at any
time. Automatic transfers into the Guarantee Periods are not permitted.

SURRENDER OF CONTRACT; PARTIAL WITHDRAWALS

Prior to the Date of Maturity, if the Annuitant is living, a Contract may
be surrendered for a cash payment of its Surrender Value, or a partial
withdrawal of the Accumulated Value may be made. The Surrender Value of a
Contract is the Accumulated Value, after any Market Value Adjustment, less any
applicable charges, including any CDSL. Accumulation Units will be redeemed at
their value next determined after the receipt by the Servicing Center of notice
of surrender or partial withdrawal in form satisfactory to the Company. The
amount of MVA Fixed Account Value will be determined on the date of receipt by
the Servicing Center of such notice. The value of any

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<PAGE>

Accumulation Units redeemed may be more or less than the premium payments
applied under the Contract, depending upon the value of the Trust's shares held
in a Subaccount at the time. Additionally, the Surrender Value of the MVA Fixed
Account, as adjusted by any applicable Market Value Adjustment, may be
more or less than the premium payments applied to the MVA Fixed Account.
The resulting cash payment upon a surrender will be reduced by any applicable
CDSL and any unpaid Contract Fees or other charges.

Unless directed otherwise by the Owner, that portion of the Accumulated
Value of the Contract redeemed in a partial withdrawal will be redeemed in each
Subaccount and each Guarantee Period in the same proportion as the Accumulated
Value of the Contract is then allocated among the Subaccounts and the Guarantee
Periods. The Company will redeem Accumulation Units and/or withdraw dollar
amounts from the MVA Fixed Account so that the total amount of a partial
withdrawal (after any Market Value Adjustment) equals the dollar amount of the
partial withdrawal request. Any applicable CDSL will be determined after any
Market Value Adjustment and will reduce the remaining Accumulated Value in the
Separate Account and MVA Fixed Account, as the case may be. The CDSL, if any,
will not reduce the partial withdrawal payment made to the owner so long as the
Accumulated Value is sufficient to cover the CDSL.

Payments of Surrender Value, in a single sum, and partial withdrawal
payments, ordinarily will be made within seven days after receipt of the above
notice by the Servicing Center. As described under "Miscellaneous Provisions-
Deferment of Payment," however, redemptions and payments may be delayed under
certain circumstances. See "Federal Income Taxes" for possible adverse tax
consequences of certain surrenders and partial withdrawals.

Any request for a surrender or partial withdrawal should be mailed to
the Servicing Center, P.O. Box 9298, Boston, MA 02205-9298.

Without our approval, a partial withdrawal is not permitted for an amount
less than $100, nor may a partial withdrawal be made if the total remaining
Accumulated Value would be less than $1,000. If the CDSL Free Withdrawal Value
is at any time less than $100, then that amount must be withdrawn in full, in a
single withdrawal, before any further partial withdrawal is made. The Contract
may be terminated by the Company if the Accumulated Value of the Contract at any
time becomes zero.

SYSTEMATIC WITHDRAWAL

An optional systematic withdrawal plan enables the Owner to pre-authorize
periodic withdrawals. Owners electing the plan instruct the Company to withdraw
a percentage or a level dollar amount from the Contract on a monthly, quarterly,
semi-annual, or annual basis. The amount withdrawn will result in the
cancellation of Accumulation Units from each applicable Subaccount in the
Separate Account, and the deduction of dollar amounts from each applicable
Guarantee Period in the MVA Fixed Account, in the ratio that the value of each
bears to the total Accumulated Value. Currently, systematic withdrawal is
available to Owners who have an Accumulated Value of $15,000 or more. The
Company reserves the right to modify the eligibility rules or other terms and
conditions of this program at any time, without notice. Systematic withdrawals
in any Contract Year in excess of 10% of the Accumulated Value as of the
beginning of the Contract Year may be subject to a CDSL. The minimum systematic
withdrawal is $100. In the event that the modal amount of the withdrawal drops
below $100 or the Accumulated Value becomes less than $5,000, the plan will be
suspended by the Company and the Owner will be notified. The systematic
withdrawal will terminate upon cancellation by the Owner.

Systematic withdrawals are subject to the CDSL and Market Value Adjustment
described above. There may be tax consequences associated with the systematic
withdrawal plan. See "Federal Income Taxes."

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<PAGE>

STANDARD DEATH BENEFIT

If the Annuitant dies before the Date of Maturity, a standard death benefit
is payable. The death benefit will be the greater of (a) the Accumulated Value,
adjusted by any Market Value Adjustment, next determined following receipt by
JHISC of due proof of death together with any required instructions as to method
of settlement, and (b) the aggregate amount of the premium payments made under
the Contract, less any partial withdrawals and CDSLs.

Payment of the death benefit will be made in a single sum to the
beneficiary designated by the Owner prior to the Annuitant's death unless an
optional method of settlement has been elected by the Owner. If an optional
method of settlement has not been elected by the Owner, the beneficiary may
elect an optional method of settlement in lieu of a single sum. No deduction is
made for sales or other expenses upon such election. Payment will be made in a
single sum in any event if the death benefit is less than $5000. See "Annuity
Options" under "The Annuity Period". If there is no surviving beneficiary, the
Owner, or his or her estate is the beneficiary.

OPTIONAL ONE YEAR STEPPED-UP DEATH BENEFIT

The Owner may elect a one year stepped-up death benefit rider that is
designed to enhance the standard death benefit payable to the beneficiary. Under
this rider, upon the death of the Annuitant before the Date of Maturity, the
benefit payable will be the greater of (a) the standard death benefit, and (b)
the highest Accumulated Value, adjusted by any Market Value Adjustment, of the
Contract as of any Contract anniversary preceding the date of receipt of due
proof of death together with any required settlement instructions and preceding
the Contract anniversary nearest the Annuitant's 81st birthday, plus any premium
payments, less any withdrawals and CDSLs, since such Contract anniversary. The
rider is elected at the time a Contract is applied for. Reference should be made
to the rider for a complete description of its terms, conditions, and benefits.
A monthly charge is made for this benefit, so long as the rider is in effect.
See "Charges Under the Contracts." This one year stepped-up death benefit is not
available for applicants age 80 or older.

OPTIONAL ACCIDENTAL DEATH BENEFIT

At the option of the Owner, an accidental death benefit may be elected at
the time the Contract is applied for. Under this rider, upon the accidental
death of the Annuitant prior to the earlier of the Date of Maturity or the
Annuitant's 80th birthday, the beneficiary will receive, in addition to any
other death benefit, an amount equal to the Accumulated Value of the Contract,
as of the date of the accident, upon receipt of due proof of the Annuitant's
death together with any required instructions as to method of settlement, up to
a maximum of $200,000. This benefit is not available to applicants age 80 or
older. A monthly charge is made for this rider as described under "Charges Under
the Contracts."

PAYMENT OF DEATH BENEFITS

The Code requires certain distribution provisions to be included in any
Contract used to fund other than a tax qualified plan. See "Federal Income
Taxes". Failure to include the required distribution provisions results in the
Contract not being treated as an annuity for Federal tax purposes. The Code
imposes comparable distribution requirements for Contracts used to fund tax
qualified plans. These required provisions for tax qualified plans will be
reflected by means of separate disclosures and endorsements furnished to
Owners.

The Code distribution requirements are expected to present few practical
problems when the Annuitant and Owner are the same person. Nevertheless, all
Owners of Contracts not used to fund a tax qualified plan and IRA Contract
Owners should be aware that the following distribution requirements are
applicable notwithstanding any provision to the contrary in the Contract (or in
this prospectus) relating to payment of the death benefit or death of the
Annuitant.

If the Owner dies before annuity payments have begun: (a) if the
beneficiary is the surviving spouse of the

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<PAGE>

Owner, the beneficiary may continue the Contract in force as Owner; or (b) if
the beneficiary is not the surviving spouse of the Owner, or if the beneficiary
is the surviving spouse of the Owner but does not choose to continue the
Contract, the entire interest in the Contract on the date of death of the Owner
must be: (i) paid out in full within five years of the Owner's death, or (ii)
applied in full towards the purchase of a life annuity on the beneficiary with
payments commencing within one year of the Owner's death. If the Owner dies on
or after annuity payments have begun, any remaining benefit must be paid out at
least as rapidly as under the method of making annuity payments then in effect.

The Code imposes comparable distribution requirements on tax qualified
plans.

If the Owner is not the Annuitant, "the entire interest in the Contract on
the date of death of the Owner" is equal to the Surrender Value if paid out in
full within five years of the Owner's death, or is equal to the Accumulated
Value if applied in full towards the purchase of a life annuity on the
beneficiary with payments commencing within one year of the Owner's death. Note
that "the entire interest in the Contract on the date of death of the Owner"
which is payable if the Owner dies before annuity payments have begun may be an
amount less than the death benefit which would have been payable if the
Annuitant had died instead.

Notice should be furnished promptly to the Servicing Center upon the death
of the Owner.

THE ANNUITY PERIOD

During the annuity period, the total value of a Contract may be allocated
among no more than four "Accounts." For this purpose, all Guarantee Periods
comprising the MVA Fixed Account are counted as one Account; each of the
Subaccounts is counted as one Account. Amounts allocated to the MVA Fixed
Account will provide annuity payments on a fixed basis; amounts allocated to the
Subaccounts will provide annuity payments on a variable basis. If more than four
Accounts are being used on the Date of Maturity, the Company will divide the
total Accumulated Value proportionately among the four Accounts with the largest
Accumulated Values.

Any Accumulated Value in the MVA Fixed Account at the Date of Maturity will
be subject to any positive or negative Market Value Adjustment that is
applicable at that time, before such amount is applied to provide annuity
payments.

Annuity payments will begin on the Date of Maturity if the Annuitant is
then living and the Contract has been in force for at least six months. Each
Contract will provide at the time of its issuance for a Life Annuity with Ten
Years Certain. Under this form of annuity, annuity payments are made monthly to
the Annuitant for life and, if the Annuitant dies within ten years after the
Date of Maturity, the payments remaining in the ten-year period will be made to
the contingent payee, subject to the terms of any supplementary agreement
issued. A different form of annuity may be elected by the Owner, as described in
"Annuity Options," below, prior to the Date of Maturity. However, the minimum
Accumulated Value that may be applied to an annuity form, other than a Life
Annuity with Ten Years Certain, is $5,000. Once a given form of annuity takes
effect, it may not be changed.

If the initial monthly annuity payment under a Contract would be less than
$50, the Company may make a single sum payment equal to the total Surrender
Value of the Contract on the date the initial payment would be payable, in place
of all other benefits.

Each Contract specifies a Provisional Date of Maturity at the time of its
issuance, which may be no earlier than six months after the date the first
payment is applied to the Contract. The Owner may subsequently elect a different
Date of Maturity, however. Unless otherwise permitted by the Company, such
subsequent date may be any earlier date provided it is no earlier than six
months after the date the first payment is applied to the Contract, nor later
than the maximum age specified in the Contract, generally age 95. The election
is made by

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<PAGE>

written notice received by the Servicing Center before the Provisional Date of
Maturity and at least 31 days prior to the Date of Maturity. If a Date of
Maturity different from the Provisional Date of Maturity is not elected by the
Owner, the Provisional Date of Maturity shall be the Date of Maturity of the
Contract. Particular care should be taken in electing the Date of Maturity for
Contracts issued under tax qualified plans. See "Federal Income Taxes."

VARIABLE MONTHLY ANNUITY PAYMENTS

Variable monthly annuity payments under a Contract are determined by
converting each Subaccount's Accumulation Units credited to the Contract (less
any applicable premium tax) into the respective Annuity Units of each applicable
Subaccount on the Date of Maturity or some other date elected for commencement
of variable annuity payments.

The amount of each variable annuity payment after the first payment will
depend on the investment performance of the Subaccounts being used. If the
actual net investment return (after deducting all charges) of a Subaccount
during the period between the dates for determining two monthly payments based
on that Subaccount exceeds the "assumed investment rate" (explained below), the
latter monthly payment will be larger than the former. On the other hand, if the
actual net investment return is less than the assumed investment rate, the
latter monthly payment will be smaller than the former.

Assumed Investment Rate

The assumed investment rate for the variable annuity portion of the
Contracts will be 3 1/2% per year except as provided below. The assumed
investment rate is significant in determining the amount of the initial variable
monthly annuity payment and the amount by which subsequent variable monthly
payments are more or less than the initial variable monthly payment.

Where applicable state law so provides, an Owner may elect a Variable
Annuity Option with assumed investment rates of 5% or 6%, if such a rate is
available in the Owner's state. Election of a higher assumed investment rate
produces a larger initial annuity payment but also means that eventually the
monthly annuity payments would be smaller than if a lower assumed investment
rate had been elected.

Calculation of Annuity Units

Accumulation Units are converted into Annuity Units by first multiplying
the number of each Subaccount's Accumulation Units credited to the Contract on
the date of conversion by the appropriate Accumulation Unit Value as of ten
calendar days prior to the date the initial variable monthly annuity payment is
due. For each Subaccount the resulting value (less any applicable premium tax)
is then multiplied by the applicable annuity purchase rate, which reflects the
age and, possibly, sex of the Annuitant and the assumed investment rate,
specified in the Contract. This computation determines the amount of each
Subaccount's initial monthly variable annuity payment to the Annuitant. The
number of each Subaccount's Annuity Units to be credited to the Contract is then
determined by dividing the amount of each Subaccount's initial variable monthly
annuity payment by each Subaccount's Annuity Unit Value as of ten calendar days
prior to the date the initial payment is due.

FIXED MONTHLY ANNUITY PAYMENTS

The dollar amount of each fixed monthly annuity payment, specified during
the entire period of annuity payments according to the provisions of the annuity
form selected, will be determined by dividing the amount

30
<PAGE>

applied under the Fixed Annuity Option (net of any applicable premium taxes) by
$1,000 and multiplying the result by the greater of: (a) the applicable factor
shown in the appropriate table in the Contract; or (b) the factor currently
offered by the Company at the time of annuitization. This current factor may be
based on the sex of the payee unless prohibited by law.

ANNUITY OPTIONS

The Owner may elect an Annuity Option during the lifetime of the Annuitant
by written notice received by the Servicing Center prior to the Date of Maturity
of the Contract. If no option is selected, Option A with Ten Years Certain will
be used. A beneficiary entitled to payment of a death benefit in a single sum
may, if no election has been made by the Owner prior to the Annuitant's death,
elect an Annuity Option by written notice received by the Servicing Center prior
to the date the proceeds become payable. No option may be elected, other than
the Life Annuity with Ten Years Certain, if the Accumulated Value to be applied
is less than $5000, in which case we will make a payment equal to the total
Surrender Value on the date the initial payment would be payable in place of all
other benefits. Among the options available are the following Annuity Options,
available for variable annuity payments and fixed annuity payments.

Option A: Life Annuity with Payments for a Guaranteed Period

Monthly payments will be made for a guaranteed period of 5, 10, or 20
years, as selected by the Owner or Beneficiary, and thereafter as long as the
payee lives, with the guarantee that if the payee dies prior to the end of the
guarantee period selected, payments will continue for the remainder of the
guaranteed period to a contingent payee, subject to the terms of any
supplementary agreement issued.

Option B: Life Annuity Without Further Payment on Death of Payee

Monthly payments will be made to the payee as long as he or she lives. No
minimum number of payments is guaranteed.

Option C: Joint and Last Survivor

Payments will be provided monthly, quarterly, semi-annually or annually for
your life and the life of your spouse/joint payee. Upon the death of one payee,
payments will continue to the surviving payee and stop upon the death of the
surviving payee.

Option D: Joint and 1/2 Survivor
Joint and 2/3 Survivor

Payments will be provided monthly, quarterly, semi-annually or annually for
your life and the life of your spouse/joint payee. Upon the death of one payee,
payments (reduced to 1/2 or 2/3 the full payment amount) will continue to the
surviving payee. Payments stop upon the death of the surviving payee.

Option E: Life Income With Cash Refund

Payments will be provided monthly, quarterly, semi-annually or annually for
your life. Upon your death, your contingent payee will receive a lump-sum
payment, if the total payments to you were less than your accumulated value at
the time of annuitization. The lump-sum payment, if any, will be for the
balance.

Option F: Income for a Fixed Period

Payments will be provided monthly, quarterly, semi-annually or annually for
a pre-determined period of time to a maximum of 30 years. If you die before the
end of the fixed period, payments will continue to your contingent payee until
the end of the period.

Option G: Income of a Specific Amount

Payments will be provided for a specific amount. Payments stop only when
the premium deposit applied and earnings have been completely paid out. If you
die before all payments are made, payments continue to your contingent payee
until the end of the contract.

Fixed and variable annuity payments are available with Annuity Options A,
B, C, and D. Only fixed annuity payments are available with Annuity Options E,
F, and G. With respect to Options F and G, payments must continue for 10 years
unless the Contract has been in force for 5 years or more.

The Option A life annuity with 5 years guaranteed and Option B life annuity
without further payment on the death of payee are not available if the Annuitant
is more than 85 years of age on the Date of Maturity.

TRANSFERS

The procedures for and terms and conditions of transfers by an Annuitant
among Subaccounts during the annuity period are the same as for transfers by
Owners among Subaccounts during the Accumulation Period. See "Accumulation
Period --Transfers Among Subaccounts and Guarantee Periods." Such transactions
involve the redemption and purchase of Annuity Units in the same manner that
transfers during the Accumulation Period involve the redemption and purchase of
Accumulation Units. No transfers to or from a Fixed Annuity Option are
permitted.

<PAGE>

OTHER CONDITIONS

The Company reserves the right at its sole discretion to make available to
Owners and other payees optional methods of payment in addition to the Annuity
Options described in this prospectus and the applicable Contract.

Federal income tax requirements currently applicable to H.R. 10 and
individual retirement annuity plans provide that the period of years guaranteed
under Option A cannot be any greater than the joint life expectancies of the
payee and his or her designated beneficiary.

If the Owner dies on or after annuity payments have begun, any remaining
benefit must be paid out at least as rapidly as under the method of making
annuity payments then in effect. The Code imposes a comparable distribution
requirement for Contracts used to fund tax qualified plans.

VARIABLE ACCOUNT VALUATION PROCEDURES

VALUATION DATE. A Valuation Date is any date on which the New York Stock
Exchange is open for trading and on which the Trust values its shares. On any
date other than a Valuation Date, the Accumulation Unit Value or Annuity Unit
Value will be the same as that on the next following Valuation Date.

VALUATION PERIOD. A Valuation Period is that period of time from the beginning
of the day following a Valuation Date to the end of the next following Valuation
Date.

ACCUMULATION UNIT VALUE. The Accumulation Unit Value is calculated separately
for each Subaccount. The value of one Accumulation Unit on any Valuation Date is
determined for each Subaccount by multiplying the immediately preceding
Accumulation Unit Value by the applicable Net Investment Factor for the
Valuation Period ending on such Valuation Date.

ANNUITY UNIT VALUE. The Annuity Unit Value is calculated separately for each
Subaccount. The value of one Annuity Unit on any Valuation Date is determined
for each Subaccount by first multiplying the immediately preceding Annuity Unit
Value by the applicable Net Investment Factor for the Valuation Period ending on
such date and then multiplying this product by an adjustment factor which will
neutralize the assumed investment rate used in determining the amounts of
annuity payable. The adjustment factor for a Valuation Period of one day for
Contracts with an assumed investment rate of 3 1/2% per year is 0.999905754. The
assumed investment rate is neutralized by applying the adjustment factor so that
the variable annuity payments will increase only if the actual net investment
rate of the Subaccount exceeds 3 1/2% per year and will decrease only if it is
less than 3 1/2% per year.

NET INVESTMENT FACTOR. The Net Investment Factor for each Subaccount for any
Valuation Period is equal to 1 plus the applicable net investment rate for such
Valuation Period. A Net Investment Factor may be more or less than 1. The net
investment rate for each Subaccount for any Valuation Period is equal to (a) the
accrued investment income and capital gains and losses, whether realized or
unrealized, of the Subaccount for such Valuation Period less (b) the sum of a
deduction for any applicable income taxes and, for each calendar day in the
Valuation Period, a deduction of 0.003425% or 0.002740% (depending on whether
the total asset-based charge for mortality and expense risks and for
administration is 1.25% or 1.00%, respectively, on an annual basis) of the value
of the Subaccount at the beginning of the Valuation Period, the result then
being divided by (c) the value of the total net assets of the Subaccount at the
beginning of the Valuation Period.

ADJUSTMENT OF UNITS AND VALUES. The Company reserves the right to change the
number and value of the Accumulation Units or Annuity Units or both credited to
any Contract, without the consent of the Owner or any other person, provided
strict equity is preserved and the change does not otherwise affect the
benefits, provisions or investment return of the Contract.

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<PAGE>

MISCELLANEOUS PROVISIONS

RESTRICTION ON ASSIGNMENT

In order to qualify for favorable tax treatment, certain Contracts may not
be sold, assigned, 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,
unless the Owner is the trustee of a trust described in Section 401(a) of the
Code. Because an assignment, pledge or other transfer may be a taxable event an
Owner should consult a competent tax adviser before taking any such action.

DEFERMENT OF PAYMENT

The Company may defer for up to 15 days the payment of any amount
attributable to a premium payment made by check to allow the check reasonable
time to clear.

Payment of the value of any Accumulation Units in a single sum upon a
surrender or partial withdrawal will ordinarily be made within seven days after
receipt of the written request therefor by the Servicing Center. However,
redemption may be suspended and payment may be postponed at times (a) when the
New York Stock Exchange is closed, other than customary weekend and holiday
closings, (b) when trading on that Exchange is restricted, (c) when an emergency
exists as a result of which disposal of securities in a Subaccount is not
reasonably practicable or it is not reasonably practicable to determine the
value of the net assets of a Subaccount or (d) when a governmental body having
jurisdiction over the Separate Account by order permits such suspension. Rules
and regulations of the Commission, if any are applicable, will govern as to
whether conditions described in (b) or (c) exist.

The Company may also defer payment of surrender proceeds payable out of the
MVA Fixed Account for a period of up to six months.

RESERVATION OF RIGHTS

The Company reserves the right to add or delete Subaccounts, to change the
underlying investments of any Subaccount, to operate the Separate Account in any
form permitted by law and to terminate the Separate Account's registration under
the 1940 Act if such registration should no longer be legally required. Certain
changes may, under applicable laws and regulations, require notice to or
approval of Owners. Otherwise, changes do not require such notice or approval.

OWNER AND BENEFICIARY

The Owner has the sole and absolute power to exercise all rights and
privileges under the Contract, except as otherwise provided by the Contract or
by written notice of the Owner. The Owner and the beneficiary are designated in
the application and may be changed by the Owner, effective upon receipt of
written notice at the Servicing Center, subject to the rights of any assignee of
record, any action taken prior to receipt of the notice and certain other
conditions. While the Annuitant is alive, the Owner may be changed by written
notice. The beneficiary may be changed by written notice no later than receipt
of due proof of the death of the Annuitant. The change will take effect whether
or not the Owner or the Annuitant is then alive.

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<PAGE>

FEDERAL INCOME TAXES

THE SEPARATE ACCOUNT, THE MVA FIXED ACCOUNT, AND THE COMPANY

The Company is taxed as a life insurance company under the Code. The
Separate Account is part of the Company's total operations and is not taxed
separately as a "regulated investment company" or otherwise.

The Contracts permit the Company to charge against the Separate Account and
the MVA Fixed Account any taxes, or provisions for taxes, attributable to the
operation or existence of the Contracts or the Separate Account. Currently, the
Company does not anticipate making a charge for income and other taxes because
of the level of such taxes. If the level of current tax is increased, or is
expected to increase in the future, the Company reserves the right to make a
charge in the future.

The Company assumes no responsibility for determining whether a particular
retirement plan satisfies the applicable requirements of the Code or whether a
particular employee is eligible for inclusion under a plan.

CONTRACTS PURCHASED OTHER THAN TO FUND A TAX QUALIFIED PLAN

The Owner or Other Payee

The Contracts are considered annuity contracts under Section 72 of the
Code. Currently no Federal income tax is payable on increases in Accumulated
Value until payments are made to the Owner or other payee under such Contract.
However, a Contract owned other than by a natural person is not generally an
annuity for tax purposes and any increase in value thereunder is taxable as
ordinary income as accrued.

When payments under a Contract are made in the form of an annuity, the
amount of each payment is taxed to the Owner or other payee as ordinary income
to the extent that such payment exceeds an allocable portion of the Owner's
"investment in the contract" (as defined in the Code). In general, an Owner's
"investment in the contract" is the aggregate amount of premium payments made by
him, reduced by any amounts previously distributed under the Contract that were
not subject to tax. The portion of each variable annuity payment to be excluded
from income is determined by dividing the "investment in the contract," adjusted
by any refund feature, by the number of periodic payments anticipated during the
time that periodic payments are to be made. In the case of a fixed annuity
payment, the amount to be excluded in each year is determined by dividing the
"investment in the contract," adjusted by any refund feature, by the amount of
"expected return" during the time that periodic payments are to be made, and
then multiplying by the amount of the payment." After the entire "investment in
the contract" has been distributed, any remaining payment is fully taxable.

When a payment under a Contract is made in a single sum, the amount of the
payment is taxed as ordinary income to the Owner or other payee to the extent it
exceeds the Owner's "investment in the contract."

For purposes of determining the amount of taxable income resulting from a
partial or complete withdrawal, all Contracts and other annuity contracts issued
by the Company or its affiliates to the Owner within the same calendar year will
be treated as if they were a single contract.

Partial Withdrawals Before Date of Maturity

When a payment under a Contract, including a payment under a systematic
withdrawal plan, is less than the amount that would be paid upon the Contract's
complete surrender and such payment is made prior to the commencement of annuity
payments under the Contract, part or all of the payment (the partial withdrawal)
may be taxed to the Owner or other payee as ordinary income.

On the date of the partial withdrawal, if the cash value of the Contract is
greater than the investment in the Contract, any part of such excess value so
withdrawn is subject to tax as ordinary income.

If an individual assigns or pledges any part of the value of a Contract,
the value so pledged or assigned is taxed as ordinary income to the same extent
as a partial withdrawal.

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<PAGE>

Penalty for Premature Withdrawals

In addition to being included in ordinary income, the taxable portion of
any withdrawal may be subject to a 10-percent penalty tax. The penalty tax does
not apply to payments made to the Owner or other payee after the Owner attains
age 59 1/2, or on account of the Owner's death or disability. If the withdrawal
is made in substantially equal periodic payments over the life of the Annuitant
or other payee or over the joint lives of the Annuitant and the Annuitant's
beneficiary the penalty will also not apply.

DIVERSIFICATION REQUIREMENTS

Each of the Funds of the Trust intends to qualify as a regulated investment
company under Subchapter M of the Code and will have to meet the investment
diversification tests of Section 817(h) of the Code and the underlying
regulations. The Treasury Department and the Internal Revenue Service may, at
some future time, issue a ruling or a regulation presenting situations in which
it will deem "investor control" to be present over the assets of the Funds of
the Trust, causing the Owner to be taxed currently on income credited to the
Contracts. In such a case, the Company reserves the right to amend the Contract
or the choice of investment options to avoid current taxation to the Owners.

CONTRACTS PURCHASED TO FUND A TAX QUALIFIED PLAN

Withholding on Eligible Rollover Distributions

Recent legislation requires 20% withholding on certain distributions from
tax qualified plans. An Owner wishing to rollover his entire distribution should
have it paid directly to the successor plan. Otherwise, the Owner's distribution
will be reduced by the 20% mandatory income tax. Consult a qualified tax adviser
before taking such a distribution.

Contracts Purchased under Individual Retirement Annuity Plans (IRA)

In general, the maximum amount of premium payments deductible each year
with respect to an individual retirement annuity contract (as defined in Section
408 of the Code) issued on the life of an eligible purchaser is the lesser of
$2,000 or 100% of compensation includible in gross income. A person may also
purchase a contract for the benefit of his or her spouse (including for example
a homemaker who does not work outside the home). Where an individual elects to
deduct amounts contributed on his or her own behalf and on behalf of a spouse,
the maximum amount of premium payments deductible is up to $2,000 for each
spouse if their combined compensation is at least equal to the contributed
amount. However, not more than $2,000 can be allocated to either person's
account. If you or your spouse is an active participant in an employer-sponsored
retirement plan, you are permitted to make a deductible premium payment only if
your adjusted gross incomes are below certain amounts.

No deduction is allowed for premium payments made in or after the taxable
year in which the Owner has attained the age of 70 1/2 years nor is a deduction
allowed for a "rollover contribution" as defined in the Code.

When payments under a Contract are made in the form of an annuity, or in a
single sum such as on surrender of the Contract or by partial withdrawal, the
payment is taxed as ordinary income.

IRS required minimum distributions must begin no later than April 1 of the
year following the year in which the Owner attains age 70 1/2. The Owner may
incur adverse tax consequences if a distribution on surrender of the Contract or
by partial withdrawal is made prior to his attaining age 59 1/2, except in the
event of his death or total disability or in certain other circumstances.

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<PAGE>

Contracts Purchased under Section 403(b) Plans (TSA)

Premium payments made by an employer which is a public school system or a
tax-exempt organization described in Section 501(c)(3) of the Code under annuity
purchase arrangements described in Section 403(b) of the Code are not taxable
currently to the Owner, to the extent that the aggregate of such amounts does
not exceed the Owner's "exclusion allowance" (as defined in the Code). In
general, an Owner's "exclusion allowance" is determined by multiplying 20% of
his "includible compensation" (as defined in the Code) by the number of years of
his service with the employer and then subtracting from that product the
aggregate amount of premium payments previously excluded from income and certain
other employer payments to retirement plans in which the Owner is a participant.
Additional limitations applicable to premium payments are described in Section
415 of the Code. Deferrals under all plans made at the election of the Owner
generally are limited to an aggregate of $9500 annually.

When payments under a Contract are made in the form of an annuity, such
payments are taxed to the Owner or other payee under the same rules that apply
to such payments under corporate plans (discussed below) except that five-year
averaging and capital gain phase-out are not available.

When payment under a Contract is made in a single sum, such as on surrender
of the contract or by partial withdrawal, the taxable portion of the payment is
taxed as ordinary income and the penalty for premature withdrawals may be
applicable.

Ordinarily an Owner in a Section 403(b) plan does not have any "investment
in the contract" and, thus, any distribution is fully taxed as ordinary income.

Distributions are prohibited before the Owner is age 59 1/2, except on the
Owner's separation from service, death, or disability and except with respect to
distributions attributable to assets held as of December 31, 1988. This
prohibition does not (1) preclude transfers and exchanges to other products that
qualify under Section 403(b) or (2) restrict withdrawals of certain amounts
attributable to pre-January 1, 1989, premium payments.

Contracts Purchased under Corporate Plans

In general, premium payments made by a corporation under a qualified
pension or profit-sharing plan described in Section 401(a) of the Code or a
qualified annuity plan described in Section 403(a) of the Code are deductible by
the corporation and are not taxable currently to the employees.

When payments under a Contract are made in the form of an annuity, the
amount of each payment is taxed to the Annuitant or other payee as ordinary
income except in those cases where the Annuitant has an "investment in the
contract" (as defined in the Code). In general, an Annuitant's "investment in
the contract" is the aggregate amount of premium payments made by him. If an
Annuitant has an "investment in the contract," a portion of each annuity payment
is excluded from income until the investment in the contract is recovered. The
amount to be excluded in each year, in the case of a variable annuity payment,
is determined by dividing the "investment in the contract," adjusted by any
refund feature, by the number of periodic payments anticipated during the time
that periodic payments are to be made. The calculation for fixed annuity
payments is somewhat different. For fixed annuity payments, in general, prior to
recovery of the "investment in the Contract," there is no tax on the amount of
each payment which bears the same ratio to that payment as the "investment on
the Contract" bears to the total expected value of the annuity payments for the
term of the payments. However, the remainder of each annuity payment is taxable.
The taxable portion of a distribution (in the form of an annuity or a single sum
payment) is taxed as ordinary income.

When payment under a Contract is made in a single sum or a total
distribution is made within one taxable year of the Annuitant or other payee,
the amount of the payment is taxed to the Annuitant or other payee to the extent
it exceeds the Annuitant's "investment in the contract." If such payment is made
after the Annuitant

36
<PAGE>

has attained age 59 1/2, or on account of his death, retirement or other
termination of employment or on account of his death after termination of
employment, five year averaging and a phase-out of capital gains treatment for
pre-1974 contributions may be available with respect to one distribution. Other
rules may be available to taxpayers who have attained age 50 prior to January 1,
1986.

IRS required minimum distributions must begin no later than April 1 of the
year following the year in which the Annuitant attains age 70 1/2 even if the
Annuitant has not retired.

Contracts Purchased under H.R. 10 Plans (Self-Employed)

Self-employed persons, including partnerships, may establish tax qualified
pension and profit-sharing plans and annuity plans for themselves and for their
employees. Generally, the maximum amount of premium payments deductible each
year with respect to variable annuity contracts issued on the life of self-
employed persons under such plans is $30,000 or 25% of "earned income" (as
defined in the Code), whichever is less. Self-employed persons must also make
premium payments for their employees (who have met certain eligibility
requirements) at least at the same rate as they do for themselves. In general,
such premium payments are deductible in full and are not taxable currently to
such employees.

Tax qualified plans may permit self-employed persons and their employees to
make additional premium payments themselves (which are not deductible) of up to
10% of earned income or compensation.

When payments under a Contract are made in the form of an annuity, such
payments are taxed to the Annuitant or other payee under the same rules that
apply to such payments under corporate plans (discussed earlier).

The tax treatment of single sum payments is also the same as under
corporate plans except that five year averaging may be unavailable to a self-
employed Annuitant on termination of service for reasons other than disability.

The same rules that apply to commencement of annuity payments under
corporate plans apply to H.R. 10 plans.

Contracts Purchased By Top-Heavy Plans

Certain corporate and H.R. 10 plans may be characterized under Section 416
of the Code as "top-heavy plans" if a significant portion of the plan assets is
held for the benefit of the "key employees" (as defined in the Code). Care must
be taken to consider the special limitations applicable to top-heavy plans and
the potentially adverse tax consequences to key employees.

37
<PAGE>

WITHHOLDING OF TAXES

The Company is obligated to withhold taxes from certain payments unless the
recipient elects otherwise. The withholding rate varies depending upon the
nature and the amount of the distribution. The Company will notify the Owner or
other payee of his or her right to elect out of withholding and furnish a form
on which the election may be made. Any election must be received by the
Servicing Center in advance of the payment in order to avoid withholding.

SEE YOUR OWN TAX ADVISER

The above description of Federal income tax consequences of owning a
Contract and of the different kinds of tax qualified plans which may be funded
by the Contracts is only a brief summary and is not intended as tax advice. The
rules governing the provisions of tax qualified plans are extremely complex and
often difficult to understand. Anything less than full compliance with the
applicable rules, all of which are subject to change from time to time, can have
adverse tax consequences. For example, premature withdrawals are generally
subject to a 10-percent penalty tax. The taxation of an Annuitant or other payee
has become so complex and confusing that great care must be taken to avoid
pitfalls. For further information a prospective purchaser should consult a
qualified tax adviser.

FURTHER INFORMATION ABOUT THE COMPANY

38
<PAGE>

BUSINESS OF THE COMPANY

The Company (or "JHVLICO" herein) was organized under the laws of the
Commonwealth of Massachusetts in 1979 and commenced insurance operations in
1980. It is a wholly-owned subsidiary of John Hancock Mutual Life Insurance
Company (John Hancock or "JHMLICO" herein), a mutual life insurance company
organized under the laws of the Commonwealth of Massachusetts in 1862.

JHVLICO is principally engaged in the writing of variable and universal life
insurance policies. JHVLICO's policies are primarily marketed through
JHMLICO's sales organization, which includes a proprietary sales force
employed at JHMLICO's own agencies and a network of independent general
agencies. Policies also are sold through various unaffiliated securities
broker-dealers and certain financial institutions with which JHMLICO and
JHVLICO have sales agreements. Currently, JHVLICO writes business in all
states except New York. At December 31, 1996, JHVLICO had $45.0 billion of
life insurance in force.

In 1993, JHVLICO acquired Colonial Penn Annuity and Life Insurance Company
and changed the latter company's name to John Hancock Life Insurance Company
of America. The subsidiary's principal business activity at December 31, 1996,
is the run-off of a block of single premium whole life insurance. For
additional discussion of this acquisition, see Note 3 of Notes to Financial
Statements.

SELECTED FINANCIAL DATA

The following financial data for JHVLICO and its subsidiary should be read
in conjunction with the financial statements and notes thereto, included
elsewhere in this Prospectus. The results for past accounting periods are not
necessarily indicative of the results to be expected in the future. The
selected financial data and financial statements have been prepared on the
basis of accounting practices prescribed or permitted by the Commonwealth of
Massachusetts Division of Insurance and in conformity with the practices of
the National Association of Insurance Commissioners ("NAIC") ("statutory
accounting practices"). See Note 1--Nature of Operations and Significant
Accounting Practices page F-6, for additional discussion.

39
<PAGE>

The information presented below should be read in conjunction with, and is
qualified in its entirety by, "Management's Discussion and Analysis of
Financial Condition and Results of Operations," and the financial statements
and other information included elsewhere in this prospectus.

<TABLE>
<CAPTION>
YEAR ENDED AND AT DECEMBER 31
--------------------------------------
1996 1995 1994 1993 1992
-------- ------ ------ ------ ------
(IN MILLIONS)
<S> <C> <C> <C> <C> <C>
SELECTED FINANCIAL DATA
INCOME STATEMENT DATA
Premiums.............................. $ 820.6 $570.9 $430.5 $398.8 $416.4
Net investment income................. 76.1 62.1 57.6 61.3 62.0
Other income, net..................... 406.0 85.7 95.5 (4.0) (3.9)
TOTAL REVENUES...................... 1,302.7 718.7 583.6 456.1 474.5
Total benefits and expenses........... 1,227.3 659.2 556.0 456.6 440.8
Income tax expense.................... 38.6 28.4 15.0 6.5 20.5
Net realized capital gains (losses)... (1.5) 0.5 0.4 (2.6) (1.4)
Net gain (loss)....................... 35.3 31.6 13.0 (9.6) 11.8
BALANCE SHEET DATA
Total assets.......................... 4,568 3,446 2,627 2,379 2,348
Total obligations..................... 4,285 3,197 2,409 2,176 2,108
Total stockholder's equity............ 283 249 218 203 240
</TABLE>
- ---------
* On October 1, 1993, JHVLICO entered into an assumption reinsurance agreement
with JHMLICO to cede a block of variable life, universal life and flexible
variable life insurance policies to JHMLICO representing substantially all
of such policies written by JHVLICO in the State of New York. In connection
with this agreement, general account assets consisting of bonds, mortgage
loans, policy loans, cash, investment income due and accrued and deferred
and uncollected premiums totaling $72.2 million were transferred by JHVLICO
to JHMLICO, along with policy reserves, unearned premiums and dividend
liabilities totaling $47.7 million and surplus totaling $24.5 million.
Separate account assets consisting of common stock and policy loans totaling
$200.8 million were transferred to John Hancock's separate accounts along
with $200.8 million in separate account policyholder obligations.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

Financial Condition

As of December 31, 1996, total assets grew by 32.5% to $4,567.8 million,
from $3,446.3 million at December 31, 1995. This increase is principally due
to the growth in the separate accounts where assets increased by 35.9% during
1996 from $2,421.0 million at December 31, 1995, to $3,290.5 million at
December 31, 1996. Total obligations grew by 34.0% to $4,284.7 million from
$3,197.6 million at December 31, 1995. As with assets, most of this growth was
in the separate accounts, which grew by 35.9% during 1996, from $2,417.0
million at December 31, 1995, to $3,285.8 million at December 31, 1996.
Separate account assets and liabilities consist primarily of the fund balances
associated with variable life and annuity business. The asset holdings include
fixed income, equity growth, total return real estate, and global mutual
funds, with liabilities representing amounts due to policyholders. Total
stockholder's equity grew by 13.8% from $248.7 million at December 31, 1995,
to $283.1 million at December 31, 1996.

As of December 31, 1995, total assets grew by 31.2%, to $3,446.3 million,
from $2,626.9 million at December 31, 1994. Much of this growth was also
attributable to an increase in separate

<PAGE>

account assets, which grew by 40.7% during 1995, from $1,721.0 million at
December 31, 1994, to $2,421.0 million at December 31, 1995. Total obligations
grew by 32.7% during 1995, from $2,409.0 million at December 31, 1994, to
$3,197.6 million at December 31, 1995. As with assets, most of this growth was
in separate accounts, which grew by 40.7% during 1995, from $1,717.7 million
at December 31, 1994, to $2,417.0 million at December 31, 1995. Total
stockholder's equity grew by 14.1%, from $217.9 million at December 31, 1994,
to $248.7 million, at December 31, 1995.

Investments

The Company continues to address industry wide issues of asset quality and
liquidity that have emerged in recent years. JHVLICO's bond portfolio is
highly diversified. It maintains diversity by geographic region, industry
group, and limiting the size of individual investments relative to the total
portfolio. In 1996, 1995, and 1994, the Company invested new money
predominantly in long-term investment grade corporate bonds as a means of
lowering the relative proportion of assets invested in commercial mortgages.
As a result, the Company's holdings in investment (NAIC SVO classes 1 and 2)
and medium (NAIC SVO class 3) grade bonds are 90.5% and 7.2%, respectively, of
total general account bonds at December 31, 1996. The corresponding
percentages at December 31, 1995 were 90.1% and 6.7%, respectively. Most of
the medium grade bonds are private placements that provide long-term financing
for medium size companies. These bonds typically are protected by individually
negotiated financial covenants and/or collateral. At December 31, 1996, the
balance (NAIC SVO classes 4, 5, and 6) of 2.3% of total general account bonds
consists of lower grade bonds and bonds in default. Bonds in default represent
0.7% of total general account bonds.

Management believes the Company's commercial mortgage lending philosophy and
practices are sound. The Company generally makes mortgage loans against
properties with proven track records and high occupancy levels, and typically
does not make construction or condominium loans nor lend more than 75% of the
property's value at the time of the loan. To assist in the management of its
mortgage loans, the Company uses a computer based mortgage risk analysis
system.

The Company has outstanding commitments to purchase long-term bonds and
issue real estate mortgages totaling $42.1 million and $33.5 million,
respectively at December 31, 1996. The corresponding amounts at December 31,
1995 were $16.6 million and $5.4 million, respectively. The Company monitors
the creditworthiness of borrowers under these commitments and requires
collateral as deemed necessary. The majority of these commitments expire in
1997.

Reserves and Obligations

The Company's obligations principally consist of aggregate reserves for life
policies and contracts of $877.8 million in the general account and
obligations of $3,285.8 million in the separate accounts at December 31, 1996.
The corresponding amounts at December 31, 1995 were $612.3 million and
$2,417.0 million, respectively. These liabilities are computed in accordance
with commonly accepted actuarial standards and are based on actuarial
assumptions which are in accordance with, or more conservative than, those
called for in state regulations. All reserves meet the requirements of the
insurance laws of the Commonwealth of Massachusetts. Intensive asset adequacy
testing was performed in 1996 for the vast majority of reserves. As a result
of that testing, no additional reserves were established. Adequacy testing is
done annually and generally performed in the fourth quarter.

The Company's investment reserves include the Asset Valuation Reserve
("AVR") required by the NAIC and state insurance regulatory authorities. The
AVR is included in the Company's

41
<PAGE>

obligations. At December 31, 1996, the AVR was $16.6 million, compared to
$15.4 million at December 31, 1995 and $12.6 million at December 31, 1994. The
AVR contained voluntary contributions of $0.0 in 1996, $2.8 million in 1995,
$1.1 million in 1994, and $1.7 million in 1993. Management believes the
Company's level of reserve is adequate and is made more conservative by the
voluntary contributions.

The AVR was established to stabilize statutory surplus from non-interest
related fluctuations in the market value of bonds, stocks, mortgage loans,
real estate and other invested assets. The AVR generally captures realized and
unrealized capital gains or losses on such assets, other than those resulting
from changes in interest rates. Each year, the amount of an insurer's AVR will
fluctuate as capital gains or losses are absorbed by the reserve. To adjust
for such changes over time, an annual contribution must be made to the AVR
equal to 20% of the difference between the maximum AVR (as determined annually
according to the type and quality of an insurer's assets) and the actual AVR.
The AVR provisions permitted a phase-in period whereby the required
contribution was 10% in 1992, 15% in 1993, and the full 20% factor thereafter.

Such contributions may result in a slower rate of growth of, or a reduction
to, surplus. Changes in the AVR are accounted for as direct increases or
decreases in surplus. The impact of the AVR on the surplus position of John
Hancock in the future will depend in part on the composition of the Company's
investment portfolio.

The Interest Maintenance Reserve ("IMR") captures realized capital gains and
losses (net of taxes) on fixed income investments (primarily bonds and
mortgage loans) resulting from changes in interest rate levels. These amounts
are not reflected in the Company's capital account and are amortized into net
investment income over the estimated remaining lives of the investments
disposed. At December 31, 1996, December 31, 1995 and December 31, 1994, the
balance of the IMR was $5.9 million, $6.9 million and $7.1 million,
respectively. The IMR provisions permitted a phase-in period so that in 1992,
50% of realized capital gains and losses on United States government
securities were recognized in net income and were not captured by the IMR. In
1993, the provisions allowed 25% of these capital gains and losses to flow to
net income with the remainder being captured in the IMR. In 1996, 1995 and
1994, all capital gains and losses on United States government securities were
captured by the IMR. The impact of the IMR on the surplus of the Company
depends upon the amount of future interest related capital gains and losses on
fixed income investments.

Results of Operations

1996 compared to 1995

Net gain from operations was $36.8 million in 1996, $5.7 million higher than
for 1995. Operating gain was positively impacted by the effects of a modified
coinsurance agreement JHVLICO and John Hancock entered into during 1996. Under
the agreement, John Hancock reinsured 50 percent of the 1995 and 1996 issues of
retail annuity contracts ("Independence Preferred" and "Declaration"). The 1996
increase in operating gain attributable to this reinsurance agreement was $15.1
million.

Operating gain was relatively stable even with the sale of the new
variable annuity product which was introduced in early 1995 and the new
corporate-owned life insurance product introduced in 1996. Premium income was
offset by credits to contractholders' accounts in the form of reserve
increases. The gain was further impacted by the first year commission charged
on new products.

Total revenues increased by 81.3%, or $584.0 million to $1,302.7 million
during 1996 from 1995. Premiums, net of premium ceded to reinsurers, increased
by 43.7% or $249.7 million. Of this increase, $255.0 million was due to the sale
of corporate-owned life insurance. Net investment income increased by 22.5% or
$14.0 million to $76.1 million during 1996 due largely to a 39.0%, or $16.4
million increase in gross income on long-term bonds. The increase on long-term
bond income was the result of an increased asset base. Other income increased by
$320.3 million which was primarily attributable to the increase in commission
and expense allowances and reserve adjustments on reinsurance ceded.

42
<PAGE>

Total benefits and expenses increased by 86.2% or $568.1 million to $1,227.3
million during 1996 from 1995. Benefit payments and additions to
reserves increased by 107.0% or $530.4 million to $1,026.2 million. Insurance
expenses increased by 22.0% or $33.1 million, to $183.8 million. The increase
was attributable largely to commission expense resulting from the sale of new
business.

1995 Compared to 1994

Net gain from operations was $31.1 million in 1995, $18.5 million higher
than 1994. Operating gain was positively impacted by the effects of a modified
coinsurance reinsurance agreement between John Hancock and the Company entered
into during 1994. Under the agreement, John Hancock reinsured 50% of the 1995
and 1994 sales of the Company's flexible premium and scheduled premium life
insurance policies. The 1995 increase in operating gain attributable to this
reinsurance agreement was $20.3 million. The increase was partially offset by
acquisition expenses of new sales and an increase in the federal income tax
expense.

Total revenues increased by 23.1%, or $135.1 million to $718.7 million,
during 1995. Premiums increased by 32.6% or $140.4 million during 1995. This
increase was primarily due to the sale of a new variable annuity product.

Total benefits and expenses increased by 18.6%, or $103.2 million to $659.2
million during 1995. Benefit payments and additions to reserves increased by
33.0%, or $123.0 million to $495.8 million. This increase was partially offset
by a decrease of $18.2 million in insurance expenses.

1994 Compared to 1993

Net gain from operations was $12.6 million in 1994, $19.6 million higher
than the net loss of $7.0 million in 1993. This increase in operating gain was
primarily attributable to the effects of the modified coinsurance reinsurance
agreement between John Hancock and the Company which was previously described.
The 1994 increase in net operating gain attributable to this reinsurance
agreement was $26.9 million.

Total revenues increased by 28.0%, or $127.5 million, to $583.6 million,
during 1994. Premiums increased by 7.9%, or $31.7 million, to $430.5 million
during 1994, reflecting growth in premium revenues from the universal life
insurance line, as well as the introduction in late 1993 and 1994 of three new
products: the Medallion variable universal product, a variable COLI product,
and a variable survivorship product. Net investment income decreased by 6.0%,
or $3.7 million to $57.6 million, during 1994, due largely to a 16.8%, or $3.3
million decrease in gross income on mortgages and real estate, which
contributed to an overall decrease of 4.9%, or $3.2 million, in gross
investment income. Net investment income was further dampened in 1994 by a
17.2%, or $0.5 million, increase in investment expenses. Other income improved
by $99.5 million during 1994, primarily due to the increase in commission and
expense allowances and reserve adjustments on reinsurance ceded, as described
above.

Total benefits and expenses increased by 21.8%, or $99.4 million, to $556.0
million, during 1994. Benefit payments and additions to reserves increased by
23.3%, or $70.5 million, to $372.8 million, during 1994. The increase was
primarily due to $73.8 million or 66.2% increase in additions to reserves,
most of which occurred in both the universal life and flexible variable life
insurance lines, offset by a 1.7% or $3.3 million decrease in benefit
payments. Insurance expenses, which included a $3.0 million charge for
restructuring during 1994, increased by 19.0%, or $27.4 million, to $171.9
million, during 1994. This growth in expenses was attributable largely to the
cost of growth in new business.

43
<PAGE>

Liquidity and Capital Resources

The Company's liquidity resources at December 31, 1996, include cash and
short-term investments of $31.9 million, public bonds of $263.2 million, and
investment grade private placement bonds of $439.7 million. The corresponding
amounts at December 31, 1995 were $76.6 million, $206.2 million, and $294.7
million, respectively. In addition, the Company's separate accounts are highly
liquid and are available to meet most outflow needs for variable life
insurance.

Management believes the liquidity resources above of $732.3 million as of
December 31, 1996, strongly position the Company to meet all its obligations
to policyholders and others. Generally, the Company's financing needs are met
by means of funds provided by normal operations. As of December 31, 1996 and
1995, the Company had no outstanding borrowings from sources outside its
affiliated group.

Total surplus, or stockholder's equity, including the AVR, is $299.7 million
as of December 31, 1996, compared to $264.1 million as of December 31, 1995,
and $230.5 million as of December 31, 1994. The current statutory accounting
treatment of deferred acquisition cost ("DAC") taxes results in an
understatement of the Company's surplus, which will persist during periods of
growth in new business written. These taxes result from federal income tax law
that approximates acquisition expenses and then spreads the corresponding tax
deduction over a period of years. The result is a DAC tax which is collected
immediately and subsequently returned through tax deduction in later years.

Since it began its operations, the Company has received a total of $381.8
million in capital contributions from John Hancock, of which $377.5 million is
credited to paid-in capital and $2.5 million is credited to capital stock as
of December 31, 1996. In 1993, $1.8 million of capital was returned to John
Hancock. To support the Company's operations, for the indefinite future, John
Hancock is committed to make additional capital contributions if necessary to
ensure that the Company maintains a positive net worth. The Company's
stockholder's equity, net of unassigned deficit, was $283.1 million at
December 31, 1996 and $248.7 million at December 31, 1995. For additional
discussion of the Company's capitalization, see Note 2 of the Notes to
Financial Statements.

In December 1992, the NAIC approved risk-based capital ("RBC") standards for
life insurance companies as well as a Model Act (the "RBC Model Act") to apply
such standards at the state level. The RBC Model Act provides that life
insurance companies must submit an annual RBC report which compares a
company's total adjusted capital (statutory surplus plus AVR, voluntary
investment reserves, and one-half the apportioned dividend liability) with its
risk-based capital as calculated by an RBC formula, where the formula takes
into account the risk characteristics of the company's investments and
products. The formula is to be used by insurance regulators as an early
warning tool to identify possible weakly capitalized companies for purposes of
initiating further regulatory action. The formula is not intended as a means
to rank insurers. The RBC Model Act gives state insurance commissioners
explicit regulatory authority to require various actions by, or take various
actions against, insurance companies whose total adjusted capital does not
meet the RBC standards. The RBC Model Act imposes broad confidentiality
requirements on those engaged in the insurance business (including insurers,
agents, brokers and others) as to the use and publication of RBC data. As of
December 31, 1996, the Company's total adjusted capital as defined by the NAIC
was well in excess of RBC standards.

Reinsurance

To reduce its exposure to large losses under its insurance policies, the
Company enters into reinsurance arrangements with its parent, John Hancock,
and other non-affiliated insurance

44
<PAGE>

companies. For further discussion of the Company's reinsurance arrangements,
including business ceded to John Hancock, see Notes 6 and 8 of the Notes to
Financial Statements.

Separate Accounts

Under applicable state insurance laws, insurers are permitted to establish
separate investment accounts in which assets backing certain policies or
contracts, including variable life policies and certain individual and group
annuity contracts, are held. The investments in each separate investment
account (which may be pooled or customer specific) are maintained separately
from other separate investment accounts and the general investment account.
The investment results of the separate investment account assets are passed
through directly to separate investment account policyholders and
contractholders, so that an insurer derives certain fees from, but bears no
investment risk on, these assets, except the risk on a small number of
products that the investment results of the separate account assets will not
meet the minimum rate guaranteed on these products. Other than amounts derived
from or otherwise attributable to the Company's general investment account,
assets of separate investment accounts are not available to fund the
liabilities of the general investment account.

COMPETITION

JHVLICO is engaged in a highly competitive business due to the large number
of stock and mutual life insurance companies and other entities marketing
insurance products. There are approximately 2,000 stock, mutual, and other
types of insurers in the life insurance business in the United States.
According to the July 1995, issue of Best's Review Life/Health, JHVLICO ranks
44th in terms of individual direct ordinary life insurance premiums written
during 1994. JHVLICO's parent, JHMLICO, ranks 15th.

Best's Company Report, dated March 17, 1997, affirms JHVLICO's financial
stability rating from A.M. Best Company, Inc. of A++, its highest, based on
the strength of its parent company and the capital guarantee discussed above.
Standard & Poor's Corporation and Duff & Phelps Credit Rating Company have
assigned insurance claims-paying ability ratings to JHVLICO of AA+ and AAA,
respectively, which place JHVLICO in the second highest and highest
categories, respectively, by these rating agencies. Moody's Investors Service,
Inc. has assigned JHVLICO a financial strength rating of Aa2, which is its
third highest rating.

EMPLOYEES AND FACILITIES

JHMLICO provides JHVLICO with personnel, property, and facilities for the
performance of certain of JHVLICO's corporate functions. JHMLICO annually
determines a fee for these services and facilities based on a number of criteria
which were revised in 1996, 1995, and 1994 to reflect continuing changes in
JHVLICO's operations. The amount of service fee charged to JHVLICO was $111.7
million, $97.9 million, and $117.0 million in 1996, 1995 and 1994, respectively.

Approximately 1,200 of JHMLICO's field office employees and agents are
members of a labor union. The agreement with union employees and agents was
ratified in June, 1996.

TRANSACTIONS WITH JHMLICO

As indicated, property, personnel and facilities are provided, at a service
fee, by JHMLICO for purposes of JHVLICO's operations, and the two companies
have entered into certain reinsurance arrangements. In addition, JHMLICO has
contributed all of JHVLICO's capital, of which $1.8 million of paid-in capital
was returned to JHMLICO during 1993. It is expected that

45
<PAGE>

arrangements and transactions such as the foregoing will continue in the
future to an indeterminate extent. See Notes 2 and 6 of the Notes to Financial
Statements.

JHMLICO receives no additional compensation for its services as underwriter
and distributor of the Contracts issued by JHVLICO.

REGULATION

JHVLICO is subject to extensive state regulatory oversight in jurisdictions
in which it does business. This regulatory oversight, increasing scrutiny upon
the insurance regulatory framework and proposals to adopt a federal regulatory
framework may in the future adversely affect JHVLICO's ability to sustain
adequate returns. JHVLICO's business also could be adversely affected by
changes in state law relating to asset and reserve valuation requirements,
limitations on investments and risk-based capital requirements, and, at the
federal level, by laws and regulations that may affect certain aspects of the
insurance industry. Assessments also are levied against John Hancock companies
as a result of participation in various types of state guaranty associations,
state insurance pools for the uninsured or other arrangements.

Regulators have the discretionary authority, in connection with the
continual licensing of JHVLICO, to limit or prohibit new issuances of business
to policyholders when, in their judgment, such regulators determine that such
insurer is not maintaining minimum statutory surplus or capital or if further
transaction of business will be hazardous to its policyholders. JHVLICO does
not believe the current or anticipated levels of statutory surplus of JHVLICO
or any member of its affiliated group, and the volume of their sales of new
life and annuity policies, present a material risk that the amount of new
insurance that JHVLICO or any of such insurance affiliates may issue will be
limited.

Although the federal government does not directly regulate the business of
insurance, federal initiatives often have an impact on the business in a
variety of ways. Current and proposed federal
measures which may significantly affect the insurance business include removal
of barriers preventing banks from engaging in the insurance business, limits
to medical testing for insurability, tax law changes affecting the taxation of
insurance companies, the tax treatment of insurance products and its impact on
the relative desirability of various personal investment vehicles and proposed
legislation to prohibit the use of gender in determining insurance and pension
rates and benefits.

46
<PAGE>

DIRECTORS AND EXECUTIVE OFFICERS

The directors and executive officers of JHVLICO are as follows:

<TABLE>
<CAPTION>
POSITION OTHER BUSINESS
NAME AGE WITH JHVLICO WITHIN PAST 5 YEARS
---- --- ------------ -------------------
<S> <C> <C> <C>
David F. D'Alessandro,
Director............... 46 Chairman Senior Executive Vice President,
Retail Sector, John Hancock
Henry D. Shaw,
Director............... 63 Vice Chairman & Senior Vice President, Retail
President Product Management, John Hancock
Robert S. Paster,
Director............... 45 Vice President Second Vice President, Direct
Distribution, John Hancock
Michele G. Van Leer,
Director............... 39 Vice President Vice President, Life Product
Management, John Hancock
Joseph A. Tomlinson,
Director............... 50 Vice President Vice President, Annuity and
Special Products, John Hancock
Robert R. Reitano,
Director............... 47 Vice President Vice President, Investment Policy
& Research, John Hancock
Barbara L. Luddy,
Director............... 45 Vice President & Vice President, Financial
Actuary Reporting & Analysis, John
Hancock
Ronald J. Bocage,
Director............... 51 Vice President & Vice President, Equity and
Counsel Pension Law, John Hancock
Thomas J. Lee,
Director............... 42 Vice President Vice President, Life Product and
Systems Management, John Hancock
Daniel L. Ouellette..... 48 Vice President, Vice President, Retail Marketing,
Marketing John Hancock
Edward P. Dowd.......... 54 Vice President, Senior Vice President, Real
Investments Estate Investment Group, John
Hancock
Roger G. Nastou......... 54 Vice President, Vice President, Bond & Corporate
Investments Finance, John Hancock
Laura L. Mangan......... 34 Vice President & Corporate Secretary, John Hancock
Secretary
Patrick F. Smith........ 54 Controller Senior Associate Controller,
Controller's Department, John
Hancock
Leonard C. Bassett...... 59 Treasurer Financial Officer, Financial
Sector Management, John Hancock
</TABLE>

47
<PAGE>

EXECUTIVE COMPENSATION

Executive officers of JHVLICO also serve one or more of the affiliated
companies of JHMLICO. Allocations have been made as to each individual's time
devoted to his or her duties as an executive officer of JHVLICO. The following
table provides information on the allocated compensation paid to the chief
executive officer for 1996. There were no executive officers of JHVLICO whose
allocated compensation exceeded $100,000 during 1996. Directors of JHVLICO
receive no compensation in addition to their compensation as employees of
JHMLICO.

<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
---------------------- -----------------
NAME TITLE SALARY BONUS OTHER LTIP ALL OTHER
---- -------- ------- ------- ------ ------- ---------
<S> <C> <C> <C> <C> <C> <C>
David F. D'Alessandro......... Chairman $28,980 $28,285 $3,370 $15,641 $ 0
</TABLE>

SEPARATE ACCOUNT PERFORMANCE

The Subaccounts may include total return in advertisements. When a
Subaccount advertises its total return, it will usually be calculated for one
year, five years, and ten years or for the life of the applicable Fund. Total
return is the percentage change between the value of a hypothetical investment
in the Subaccount at the beginning of the relevant period to the value of the
investment at the end of the period, assuming the deduction of any CDSL which
would be payable if the Contract Owner surrendered the Contract at the end of
the period indicated. Total return at the Separate Account level will reflect
the CDSL, mortality and expense risk charges, administrative charge, and the
annual Contract Fee. The total return figures will not reflect any premium tax
charge or any charges for optional benefits, including the Nursing Home Waiver
of CDSL, One Year Stepped-Up Death Benefit and Accidental Death Benefit riders.
The total return for the Separate Account will be lower than total return at the
Trust level where comparable charges are not deducted.

The Subaccounts may also advertise total returns in a non-standard format
in conjunction with the standard format described above. The non-standard format
will be the same as the standard format except that it will not reflect any
CDSL.

The Money Market Subaccount may advertise "current yield" and "effective
yield." Current yield refers to the income earned by the Subaccount over a
seven-day period and then annualized; i.e., the income earned in the period is
assumed to be earned every seven days over a 52-week period and stated as a
percentage of the investment. Effective yield is calculated similarly but, when
annualized, the income earned by the investment is assumed to be reinvested in
the Subaccount and thus compounded in the course of a 52-week period. The
effective yield will be slightly higher than the current yield because of this
compounding effect of the assumed reinvestment.

The other Subaccounts may also advertise current yield. For these
Subaccounts, the current yield will be calculated by dividing the annualization
of the income earned by the Subaccount during a recent thirty-day period by the
maximum offering price per unit at the end of such period. In all cases,
current yield and effective yield will reflect the recurring charges at the
Separate Account level including the annual Contract Fee, but will not reflect
any premium tax charge, any CDSL, or any charges for optional benefit riders.

Performance information for the Subaccounts may be compared to other
variable annuity separate accounts or other investment products surveyed by
Lipper Analytical Services, Inc., an independent service which monitors and
ranks the performance of investment companies. Ibottson and Associates, CDA
Weisenberger, and F.C. Towers are also used for comparison purposes, as well as
the Russell and Wilshire Indices. Performance rankings and ratings reported
periodically in national financial publications such as MONEY Magazine, FORBES,
BUSINESS WEEK, THE WALL STREET JOURNAL, MICROPAL, INC., MORNINGSTAR, STANGER'S,
AND BARRON'S may also be utilized. Performance figures are

48
<PAGE>

calculated in accordance with standardized methods established by each reporting
service.

REPORTS

The Company intends to deliver to Owners of outstanding Contracts annual
account statements and such other periodic reports as may be required by law,
but it is not anticipated that any such reports will include periodic financial
statements or information concerning the Company.

VOTING PRIVILEGES

All of the assets in the Subaccounts of the Separate Account are invested
in shares of the corresponding Funds of the Trust. The Company will vote the
shares of each Fund which are deemed attributable to the Contracts at meetings
of the Trust's shareholders in accordance with instructions received from Owners
of the Contracts. Units of the Trust held in the Separate Account which are not
attributable to the Contracts and those for which instructions from owners are
not received will be represented by the Company at the meeting and will be voted
for and against each matter in the same proportion as the votes based upon the
instructions received from the owners of all annuity contracts funded through
the Separate Account's corresponding variable Subaccounts.

The number of shares of a Fund held in each Subaccount deemed attributable
to each Owner is determined by dividing a Contract's Accumulation Unit Value (or
for a Contract under which annuity payments have commenced, the equivalent) in
the Subaccount by the net asset value of one share in the corresponding Fund in
which the assets of that Subaccount are invested. Fractional votes will be
counted. The number of shares as to which the Owner may give instructions will
be determined as of the record date for the Trust's meeting.

Owners of Contracts may give instructions regarding the election of the
Board of Trustees of the Trust, ratification of the selection of independent
auditors, approval of the Trust investment management agreements and other
matters requiring a vote under the 1940 Act. Owners will be furnished
information and forms by the Company in order that voting instructions may be
given.

CHANGES IN APPLICABLE LAW-FUNDING AND OTHERWISE

The voting privileges described in this prospectus are afforded based on
the Company's understanding of applicable Federal securities law requirements.
To the extent that applicable law, regulations or interpretations change to
eliminate or restrict the need for such voting privileges, the Company reserves
the right to proceed in accordance with any such revised requirements. The
Company also reserves the right, subject to compliance with applicable law,
including approval of Owners if so required, to transfer assets determined by
the Company to be associated with the class of contracts to which the Contracts
belong from the Account to another separate account or Subaccount by withdrawing
the same percentage of each investment in the Separate Account with appropriate
adjustments to avoid odd lots and fractions.

<PAGE>

DISTRIBUTION OF THE CONTRACTS

JHFI is registered as a broker-dealer under the Securities Exchange Act of
1934 and is a member of the National Association of Securities Dealers, Inc.
JHFI acts as principal underwriter and principal distributor of the Contracts.
The Contracts may be purchased through broker-dealers and certain financial
institutions who have entered into selling agreements with JHFI and the
Company, and whose representatives are authorized by applicable law to sell
annuity products. The compensation paid to such broker-dealers and financial
institutions is not expected to exceed 7.0% of premium payments. The offering
of the Contracts is intended to be continuous, but neither the Company nor JHFI
is obligated to sell any particular amount of Contracts.

The Company reimburses JHFI for direct and indirect expenses actually
incurred in connection with the marketing and sale of the Contracts.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the 1934 Act,
and in accordance therewith files reports and other information with the
Commission. Such reports and other information can be inspected and copied at
the public reference facilities of the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C., and at the Commission's Regional Offices located
at 7 World Trade Center, Suite 1300, New York, New York, and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois. Copies of such
materials also can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates.

The Company has filed registration statements ("Registration Statements")
with the Commission under the Securities Act of 1933 relating to the Contracts
offered by this prospectus. This prospectus has been filed as a part of the
Registration Statements and does not contain all of the information set forth in
the Registration Statements and exhibits thereto, and reference is hereby made
to such Registration Statements and exhibits for further information relating to
the Company and the Contracts. The Registration Statements and the exhibits
thereto may be inspected and copied, and copies can be obtained at prescribed
rates, in the manner set forth in the preceding paragraph.

<PAGE>

EXPERTS AND FINANCIAL STATEMENTS

The statutory-basis financial statements of JHVLICO at December 31, 1996
and 1995, and for each of the three years in the period ended December 31, 1996,
appearing in this Prospectus and Registration Statement and the annual financial
statements of John Hancock Variable Annuity Account JF at December 31, 1996, and
for the four-month period ended December 31, 1996, appearing in the Statement of
Additional Information included in the Registration Statement have been audited
by Ernst & Young LLP, independent auditors, as set forth in their reports theron
appearing elsewhere herein, and are included in reliance upon such reports given
upon the authority of such firm as experts in accounting and auditing.

TABLE OF CONTENTS OF STATEMENT
OF ADDITIONAL INFORMATION

<TABLE>
<CAPTION>
CROSS REFERENCE TO
PAGE PAGE IN PROSPECTUS
---- ------------------
<S> <C> <C>
The Separate Account ............................... 2 15
Services Agreement ................................. 2 NA
Calculation of Performance Data .................... 2 48
Calculation of Annuity Payments .................... 3 32
Separate Account Financial Statements .............. 6 F-1
</TABLE>

<PAGE>

REPORT OF INDEPENDENT AUDITORS

Board of Directors
John Hancock Variable Life Insurance Company

We have audited the accompanying statutory-basis statements of financial
position of John Hancock Variable Life Insurance Company as of December 31,
1996 and 1995, and the related statutory-basis statements of operations and
unassigned deficit and cash flows for each of the three years in the period
ended December 31, 1996. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

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

As described in Note 1 to the financial statements, the Company presents its
financial statements in conformity with accounting practices prescribed or
permitted by the Commonwealth of Massachusetts Division of Insurance, which
practices differ from generally accepted accounting principles. The variances
between such practices and generally accepted accounting principles also are
described in Note 1. The effects on the financial statements of these
variances are not reasonably determinable but are presumed to be material.

In our reports dated February 7, 1996 and 1995, we expressed an opinion that
the 1995 and 1994 financial statements of the Company fairly present, in all
material respects, the Company's financial position, results of its
operations, and its cash flows in conformity with generally accepted
accounting principles for stock life insurance company wholly-owned by a
mutual life insurance company and with reporting practices prescribed or
permitted by the Commonwealth of Massachusetts Division of Insurance. As
described in Note 1, the accompanying statutory-basis financial statements are
no longer considered to be prepared in conformity with generally accepted
accounting principles. Accordingly, our present opinion on the 1995 and 1994
financial statements, as presented in the following paragraph, is different
from that expressed in our previous reports.

In our opinion, because of the effects of the matter described in the second
preceding paragraph, the financial statements referred to above do not present
fairly, in conformity with generally accepted accounting principles, the
financial position of John Hancock Variable Life Insurance Company at December
31, 1996 and 1995, or the results of its operations or its cash flows for the
three years then ended.

Also, in our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of John Hancock
Variable Life Insurance Company at December 31, 1996 and 1995, and the results
of its operations and its cash flows for each of the three years in the period
ended December 31, 1996 in conformity with accounting practices prescribed or
permitted by the Commonwealth of Massachusetts Division of Insurance.

Ernst & Young LLP
February 14, 1997

F-1
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

STATUTORY-BASIS STATEMENTS OF FINANCIAL POSITION

<TABLE>
<CAPTION>
DECEMBER 31
------------------
1996 1995
-------- --------
(IN MILLIONS)
<S> <C> <C>
ASSETS
Bonds--Note 7............................................ $ 753.5 $ 552.8
Preferred stocks......................................... 9.6 5.0
Common stocks............................................ 1.4 1.7
Investment in affiliates................................. 72.0 65.3
Mortgage loans on real estate--Note 7.................... 212.1 146.7
Real estate.............................................. 38.8 36.4
Policy loans............................................. 80.8 61.8
Cash items:
Cash in banks.......................................... 26.7 11.6
Temporary cash investments............................. 5.2 65.0
-------- --------
31.9 76.6

Premiums due and deferred................................ 36.8 39.6
Investment income due and accrued........................ 22.6 18.6
Other general account assets............................. 17.8 20.8
Assets held in separate accounts......................... 3,290.5 2,421.0
-------- --------
TOTAL ASSETS......................................... $4,567.8 $3,446.3
======== ========
OBLIGATIONS AND STOCKHOLDER'S EQUITY

OBLIGATIONS
Policy reserves.......................................... $ 877.8 $ 612.3
Federal income and other taxes payable--Note 1........... 29.4 14.2
Other accrued expenses................................... 75.1 138.7
Asset valuation reserve--Note 1.......................... 16.6 15.4
Obligations related to separate accounts................. 3,285.8 2,417.0
-------- --------
TOTAL OBLIGATIONS.................................... 4,284.7 3,197.6

STOCKHOLDER'S EQUITY--Notes 2 and 6
Common Stock, $50 par value; authorized 50,000 shares;
issued and outstanding 50,000 shares.................... 2.5 2.5
Paid-in capital.......................................... 377.5 377.5
Unassigned deficit....................................... (96.9) (131.3)
-------- --------
TOTAL STOCKHOLDER'S EQUITY........................... 283.1 248.7
-------- --------
TOTAL OBLIGATIONS AND STOCKHOLDER'S EQUITY................. $4,567.8 $3,446.3
======== ========
</TABLE>

The accompanying notes are an integral part of the statutory-basis financial
statements.

F-2
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

STATUTORY-BASIS STATEMENTS OF OPERATIONS AND UNASSIGNED DEFICIT

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
--------------------------
1996 1995 1994
-------- ------- -------
<S> <C> <C> <C>
INCOME
Premiums......................................... $ 820.6 $ 570.9 $ 430.5
Net investment income--Note 4.................... 76.1 62.1 57.6
Other, net....................................... 406.0 85.7 95.5
-------- ------- -------
1,302.7 718.7 583.6
BENEFITS AND EXPENSES
Payments to policyholders and beneficiaries...... 236.1 213.4 187.5
Additions to reserves to provide for future pay-
ments
to policyholders and beneficiaries.............. 790.1 282.4 185.3
Expenses of providing service to policyholders
and
obtaining new insurance--Note 6................. 183.8 150.7 168.9
Cost of restructuring............................ 0.0 0.0 3.0
State and miscellaneous taxes.................... 17.3 12.7 11.3
-------- ------- -------
1,227.3 659.2 556.0
-------- ------- -------
GAIN FROM OPERATIONS BEFORE FEDERAL
INCOME TAXES AND NET REALIZED
CAPITAL GAINS (LOSSES)........................ 75.4 59.5 27.6
Federal income taxes--Note 1....................... 38.6 28.4 15.0
-------- ------- -------
GAIN FROM OPERATIONS BEFORE NET
REALIZED CAPITAL GAINS (LOSSES)............... 36.8 31.1 12.6
Net realized capital gains (losses)--Note 5........ (1.5) 0.5 0.4
-------- ------- -------
NET GAIN....................................... 35.3 31.6 13.0
Unassigned deficit at beginning of year............ (131.3) (162.1) (177.2)
Net unrealized capital gains (losses) and
other adjustments--Note 5 ........................ 2.5 (3.0) (1.5)
Valuation reserve changes--Note 1.................. 0.0 0.0 2.7
Other reserves and adjustments..................... (3.4) 2.2 0.9
-------- ------- -------
UNASSIGNED DEFICIT AT END OF YEAR.............. $ (96.9) $(131.3) $(162.1)
======== ======= =======
</TABLE>

The accompany notes are an integral part of the statutory-basis financial
statements.

F-3
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

STATUTORY-BASIS STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
-------------------------
1996 1995 1994
------- ------- -------
(IN MILLIONS)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Insurance premiums................................. $ 824.2 $ 574.0 $ 436.4
Net investment income.............................. 73.4 59.2 57.9
Benefits to policyholders and beneficiaries........ (212.7) (198.3) (175.3)
Dividends paid to policyholders.................... (15.7) (13.2) (11.9)
Insurance expenses and taxes....................... (196.6) (161.5) (180.6)
Net transfers to separate accounts................. (524.2) (257.4) (146.6)
Other, net......................................... 386.7 55.1 83.2
------- ------- -------
NET CASH PROVIDED FROM OPERATIONS.............. 335.1 57.9 63.1
------- ------- -------
CASH FLOWS USED IN INVESTING ACTIVITIES:
Bond purchases..................................... (489.9) (172.5) (94.1)
Bond sales......................................... 228.3 18.9 23.1
Bond maturities and scheduled redemptions.......... 27.8 36.0 22.3
Bond prepayments................................... 31.9 20.6 24.7
Stock purchases.................................... (6.5) (1.7) (1.5)
Proceeds from stock sales.......................... 0.4 1.4 1.2
Real estate purchases.............................. (10.5) (16.2) (18.4)
Real estate sales.................................. 8.5 9.3 22.1
Other invested assets purchases.................... 0.0 (0.4) (0.9)
Proceeds from the sale of other invested assets.... 1.5 0.3 1.3
Mortgage loans issued.............................. (84.4) (19.8) (37.9)
Mortgage loan repayments........................... 17.7 21.1 35.2
Other, net......................................... (104.6) 45.7 12.5
------- ------- -------
NET CASH USED IN INVESTING
ACTIVITIES.................................... (379.8) (57.3) (10.4)
------- ------- -------
INCREASE (DECREASE) IN CASH AND
TEMPORARY CASH INVESTMENTS.................... (44.7) 0.6 52.7
Cash and temporary cash investments at
beginning of year................................... 76.6 76.0 23.3
------- ------- -------
CASH AND TEMPORARY CASH
INVESTMENTS AT THE END OF YEAR................ $ 31.9 $ 76.6 $ 76.0
======= ======= =======
</TABLE>

The accompanying notes are an integral part of the statutory-basis financial
statements.

F-4
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

STATUTORY-BASIS STATEMENTS OF STOCKHOLDER'S EQUITY

<TABLE>
<CAPTION>
ADDITIONAL
COMMON PAID-IN UNASSIGNED
STOCK CAPITAL DEFICIT TOTAL
------ ---------- ---------- ------
(IN MILLIONS)
<S> <C> <C> <C> <C>
Balance at January 1, 1994................ $25.0 $355.0 $(177.2) $202.8
1994 Transactions:
Net gain................................ 13.0 13.0
Net unrealized capital losses and other
adjustments............................ (1.5) (1.5)
Valuation reserve changes............... 2.7 2.7
Other reserves and adjustments.......... 0.9 0.9
----- ------ ------- ------
Balance at December 31, 1994.............. 25.0 355.0 (162.1) 217.9
1995 Transactions:
Net gain................................ 31.6 31.6
Net unrealized capital losses and other
adjustments............................ (3.0) (3.0)
Other reserves and adjustments.......... 2.2 2.2
Reclassification of paid-in capital..... (22.5) 22.5 0.0
----- ------ ------- ------
Balance at December 31, 1995.............. 2.5 377.5 (131.3) 248.7
1996 Transactions:
Net gain................................ 35.3 35.3
Net unrealized capital gains and other
adjustments............................ 2.5 2.5
Change in separate account surplus
Other reserves and adjustments.......... (3.4) (3.4)
----- ------ ------- ------
Balance at December 31, 1996.............. $ 2.5 $377.5 $ (96.9) $283.1
===== ====== ======= ======
</TABLE>

The accompanying notes are an integral part of the statutory-basis financial
statements.

F-5
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS

NOTE 1--NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING PRACTICES

John Hancock Variable Life Insurance Company (the Company) is a wholly-owned
subsidiary of John Hancock Mutual Life Insurance Company (John Hancock). The
Company, domiciled in the Commonwealth of Massachusetts, principally writes
variable and universal life insurance policies. Those policies primarily are
marketed through John Hancock's sales organization, which includes a career
agency system composed of company-owned, unionized branch offices and
independent general agencies. Policies also are sold through various
unaffiliated securities broker-dealers and certain other financial
institutions. Currently the Company writes business in all states except New
York.

The preparation of the financial statements of insurance companies requires
management to make estimates and assumptions that affect amounts reported in
the financial statements and accompanying notes. Such estimates and
assumptions could change in the future as more information becomes known,
which could impact the amounts reported and disclosed herein.

Basis of Presentation: The financial statements have been prepared using
accounting practices prescribed or permitted by the Commonwealth of
Massachusetts Division of Insurance and in conformity with the practices of
the National Association of Insurance Commissioners (NAIC), which practices
differ from generally accepted accounting principles (GAAP). The 1995 and 1994
financial statements presented for comparative purposes were previously
described as being prepared in accordance with GAAP for stock life insurance
companies wholly-owned by a mutual life insurance company. Pursuant to
Financial Accounting Standards Board Interpretation 40, "Applicability of
Generally Accepted Accounting Principles to Mutual Life Insurance and Other
Enterprises" (FIN 40), as amended, which is effective for 1996 financial
statements, financial statements based on statutory accounting practices can
no longer be described as prepared in conformity with GAAP. Furthermore,
financial statements prepared in conformity with statutory accounting
practices for periods prior to the effective date of FIN 40 are not considered
GAAP presentations when presented in comparative form with financial
statements for periods subsequent to the effective date. Accordingly, the 1995
and 1994 financial statements are no longer considered to be presented in
conformity with GAAP.

The significant differences from GAAP include: (1) policy acquisition costs
are charged to expense as incurred rather than deferred and amortized over the
related premium-paying period; (2) policy reserves are based on statutory
mortality, morbidity, and interest requirements without consideration of
withdrawals and Company experience; (3) certain assets designated as
"nonadmitted assets" are excluded from the balance sheet by direct charges to
surplus; (4) reinsurance recoverables are netted against reserves and claim
liabilities rather than reflected as an asset; (5) bonds held as available for
sale are recorded at amortized cost or market value as determined by the NAIC
rather than at fair value; (6) an Asset Valuation Reserve and Interest
Maintenance Reserve as prescribed by the NAIC are not calculated under GAAP.
Under GAAP, realized capital gains and losses are reported in the income
statement on a pretax basis as incurred and valuation allowances would be
provided when there has been a decline in value deemed other than temporary;
(7) investments in affiliates are carried at their net equity value with
changes in value being recorded directly to unassigned deficit rather than
consolidated in the financial statements; and (8) no provision is made for the
deferred income tax effects of temporary differences between book and tax
basis reporting. The effects of the foregoing variances from GAAP have not
been determined but are presumed to be material.

F-6
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 1--NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING PRACTICES--(CONTINUED)

The significant accounting practices of the Company are as follows:

Pending Statutory Standards: The NAIC currently is in the process of
recodifying statutory accounting practices, the result of which is expected to
constitute the only source of prescribed statutory accounting practices.
Accordingly, that project, which is expected to be completed in 1999 will
likely change, to some extent, prescribed statutory accounting practices, and
may result in changes to the accounting practices that the Company uses to
prepare its statutory-basis financial statements. The impact of any such
changes on the Company's unassigned deficit cannot be determined at this time
and could be material.

Revenues and Expenses: Premium revenues are recognized over the premium-
paying period of the policies whereas expenses, including the acquisition
costs of new business, are charged to operations as incurred and policyholder
dividends are provided as paid or accrued.

Cash and Temporary Cash Investments: Cash includes currency on hand and
demand deposits with financial institutions. Temporary cash investments are
short-term, highly-liquid investments both readily convertible to known
amounts of cash and so near maturity that there is insignificant risk of
changes in value because of changes in interest rates.

Valuation of Assets: General account investments are carried at amounts
determined on the following bases:

Bonds and stock values are carried as prescribed by the NAIC; bonds
generally at amortized amounts or cost, preferred stocks generally at cost
and common stocks at market. The discount or premium on bonds is amortized
using the interest method.

Investments in affiliates are included on the statutory equity method.

Goodwill is amortized on a straight-line basis over a ten year period.

Mortgage loans are carried at outstanding principal balance or amortized
cost.

Investment real estate is carried at depreciated cost, less encumbrances.
Depreciation on investment real estate is recorded on a straight-line
basis. Accumulated depreciation amount to $1.2 million in 1996 and $0.5
million in 1995.

Real estate acquired in satisfaction of debt and held for sale is carried
at the lower of cost or market as of the date of foreclosure.

Policy loans are carried at outstanding principal balance, not in excess
of policy cash surrender value.

Asset Valuation and Interest Maintenance Reserves: The Asset Valuation
Reserve (AVR) is computed in accordance with the prescribed NAIC formula and
represents a provision for possible fluctuations in the value of bonds, equity
securities, mortgage loans, real estate and other invested assets. Changes to
the AVR are charged or credited directly to the unassigned deficit.

The Company also records the NAIC prescribed Interest Maintenance Reserve
(IMR) that represents that portion of the after tax net accumulated
unamortized realized capital gains and losses on sales of fixed income
securities, principally bonds and mortgage loans, attributable to changes in
the general level of interest rates. Such gains and losses are deferred and
amortized into income over the remaining expected lives of the investments
sold. At December 31, 1996,

F-7
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 1--NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING PRACTICES--(CONTINUED)

the IMR, net of 1996 amortization of $1.2 million, amounted to $5.9 million
which is included in policy reserves. The corresponding 1995 amounts were $1.2
million and $6.9 million, respectively.

Separate Accounts: Separate account assets and liabilities reported in the
accompanying statements of financial position represent funds that are
separately administered and for which the contractholder, rather than the
Company, generally bears the investment risk. Separate account contractholders
have no claim against the assets of the general account of the Company.
Separate account assets are reported at market value. The operations of the
separate accounts are not included in the summary of operations; however,
income earned on amounts initially invested by the Company in the formation of
new separate accounts is included in other income.

Fair Values of Financial Instruments: Statement of Financial Accounting
Standards (SFAS) No. 107, "Disclosure about Fair Value of Financial
Instruments," requires disclosure of fair value information about financial
instruments, whether or not recognized in the statement of financial position,
for which it is practicable to estimate the value. In situations where quoted
market prices are not available, fair values are based on estimates using
present value or other valuation techniques. SFAS No. 107 excludes certain
financial instruments and all nonfinancial instruments from its disclosure
requirements. Therefore, the aggregate fair value amounts presented do not
represent the underlying value of the Company.

The methods and assumptions utilized by the Company in estimating its fair
value disclosures for financial instruments are as follows:

The carrying amounts reported in the statement of financial position for
cash and temporary cash investments approximate their fair values.

Fair values for public bonds are obtained from an independent pricing
service. Fair values for private placement securities and publicly traded
bonds not provided by the independent pricing service are estimated by the
Company by discounting expected future cash flows using current market
rates applicable to the yield, credit quality and maturity of the
investments. The fair values for common and preferred stocks, other than
its subsidiary investments, which are carried at equity values, are based
on quoted market prices.

The fair value of interest rate swaps and currency rate swaps is
estimated using a discounted cash flow method adjusted for the difference
between the rate of the existing swap and the current swap market rate.
Discounted cash flows in foreign currencies are converted to U.S. dollars
using current exchange rates.

The fair value for mortgage loans is estimated using discounted cash flow
analyses using interest rates adjusted to reflect the credit
characteristics of the loans. Mortgage loans with similar characteristics
and credit risks are aggregated into qualitative categories for purposes of
the fair value calculations.

The carrying amount in the statement of financial position for policy
loans approximates their fair value.

The fair value for outstanding commitments to purchase long-term bonds
and issue real estate mortgages is estimated using a discounted cash flow
method incorporating adjustments for the difference in the level of
interest rates between the dates the commitments were made and December 31,
1996. The fair value for commitments to purchase real estate approximates
the amount of the initial commitment.

F-8
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 1--NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING PRACTICES--(CONTINUED)

Capital Gains and Losses: Realized capital gains and losses are determined
using the specific identification basis. Realized capital gains and losses,
net of taxes and amounts transferred to the IMR, are included in net gain or
loss. Unrealized gains and losses, which consist of market value and book
value adjustments, are shown as adjustments to the unassigned deficit.

Policy Reserves: Life reserves are developed by actuarial methods and
determined based on published tables using statutorily specified interest
rates and valuation methods that will provide, in the aggregate, reserves that
are greater than or equal to the minimum or guaranteed policy cash values or
amounts required by the Commonwealth of Massachusetts Division of Insurance.
Reserves for variable life insurance policies are maintained principally on
the modified preliminary term method using the 1958 and 1980 Commissioner's
Standard Ordinary (CSO) mortality tables, with an assumed interest rate of 4%
for policies issued prior to May 1, 1983 and 4 1/2% for policies issued on or
thereafter. Reserves for single premium policies are determined by the net
single premium method using the 1958 CSO mortality table, with an assumed
interest rate of 4%. Reserves for universal life policies issued prior to 1985
are equal to the gross account value which at all times exceeds minimum
statutory requirements. Reserves for universal life policies issued from 1985
through 1988 are maintained at the greater of the Commissioner's Reserve
Valuation Method (CRVM) using the 1958 CSO mortality table, with 4 1/2%
interest or the cash surrender value. Reserves for universal life policies
issued after 1988 and for flexible variable policies are maintained using the
greater of the cash surrender value or the CRVM method with the 1980 CSO
mortality table and 5 1/2% interest for policies issued from 1988 through
1992; 5% interest for policies issued in 1993 and 1994; and 4 1/2% interest
for policies issued in 1995 and 1996.

Federal Income Taxes: Federal income taxes are reported in the financial
statements based on amounts determined to be payable as a result of operations
within the current accounting period. The operations of the Company are
consolidated with John Hancock in filing a consolidated federal income tax
return for the affiliated group. The federal income taxes of the Company are
allocated on a separate return basis with certain adjustments. The Company
made payments of $33.5 million in 1996 and $32.2 million in 1995 and received
tax benefits of $7.0 million in 1994.

Income before taxes differs from taxable income principally due to tax-
exempt investment income, the limitation placed on the tax deductibility of
policyholder dividends, accelerated depreciation, differences in policy
reserves for tax return and financial statement purposes, capitalization of
policy acquisition expenses for tax purposes and other adjustments prescribed
by the Internal Revenue Code.

No provision is generally recognized for timing differences that may exist
between financial reporting and taxable income or loss.

Adjustments to Policy Reserves: From time to time, the Company finds it
appropriate to modify certain required policy reserves because of changes in
actuarial assumptions or increased benefits. Reserve modifications resulting
from such determinations are recorded directly to the unassigned deficit.
During 1994, the Company refined certain actuarial assumptions inherent in the
calculation of preconversion yearly renewable term and gross premium
deficiency reserves, resulting in a $2.7 million decrease in the unassigned
deficit at December 31, 1994. During 1996 and 1995, there were no refinements
in actuarial assumptions inherent in the calculation of policy reserves.

F-9
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 1--NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING PRACTICES--(CONTINUED)

Reinsurance: Premiums, commissions, expense reimbursements, benefits and
reserves related to reinsured business are accounted for on bases consistent
with those used in accounting for the original policies issued and the terms
of the reinsurance contracts. Premiums ceded to other companies have been
reported as a reduction of premium income. Amounts applicable to reinsurance
ceded for future policy benefits, unearned premium reserves and claim
liabilities have been reported as reductions of these items.

Reclassifications: Certain 1995 and 1994 amounts have been reclassified to
permit comparison with the corresponding 1996 amounts.

NOTE 2--CAPITALIZATION

In prior years, the Company received capital contributions from John
Hancock, with a portion of the contributed capital being credited to common
stock, although no additional shares were issued. This practice, which is
acceptable to statutory authorities, has the effect of stating the carrying
value of issued shares of common stock at amounts other than $50 per share par
value with the offset reflected in paid-in capital.

At December 31, 1994, the Company had 50,000 shares authorized with 20,000
shares issued and outstanding. On February 16, 1995, the Company issued the
remaining 30,000 shares to John Hancock and transferred $22.5 million from
common stock to paid-in capital. The par value per share is $50.

NOTE 3--ACQUISITION

On June 23, 1993, the Company acquired all of the outstanding shares of
stock of Colonial Penn Annuity and Life Insurance Company (CPAL) from Colonial
Penn Life Insurance Company, for an aggregate purchase price of approximately
$42.5 million. At the date of acquisition, assets of CPAL were approximately
$648.5 million, consisting principally of cash and temporary cash investments
and liabilities were approximately $635.2 million, consisting principally of
reserves related to a block of interest sensitive single-premium whole life
insurance business assumed by CPAL from Charter National Life Insurance
Company (Charter). The purchase price includes contingent payments of up to
approximately $7.3 million payable between 1994 and 1998 based on the actual
lapse experience of the business in force on June 23, 1993. The Company made
contingent payments to CPAL of $1.5 million during each of 1996, 1995, and
1994. Unamortized goodwill of $15.2 and $17.1 million at December 31, 1996 and
December 31, 1995, respectively is being amortized over ten years on a
straight-line basis.

On June 24, 1993, the Company contributed $24.6 million in additional
capital to CPAL. CPAL was renamed John Hancock Life Insurance Company of
America (JHLICOA) on July 7, 1993. JHLICOA manages the business assumed from
Charter and does not currently issue new business.

F-10
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 4--NET INVESTMENT INCOME

Investment income has been reduced by the following amounts:

<TABLE>
<CAPTION>
1996 1995 1994
----- ----- -----
(IN MILLIONS)
<S> <C> <C> <C>
Investment expenses....................................... $ 7.0 $ 5.1 $ 3.4
Interest expense.......................................... 0.0 0.0 0.2
Depreciation expense...................................... 0.9 1.0 0.6
Investment taxes.......................................... 0.5 0.5 0.2
----- ----- -----
$ 8.4 $ 6.6 $ 4.4
===== ===== =====

NOTE 5--NET CAPITAL GAINS (LOSSES) AND OTHER ADJUSTMENTS

Net realized capital gains (losses) consist of the following items:

<CAPTION>
1996 1995 1994
----- ----- -----
(IN MILLIONS)
<S> <C> <C> <C>
Net gains (losses) from asset sales....................... $(0.2) $ 4.0 $(1.6)
Capital gains (tax) credit................................ (1.0) (2.5) 2.5
Net amounts transferred to IMR............................ (0.3) (1.0) (0.5)
----- ----- -----
$(1.5) $ 0.5 $ 0.4
===== ===== =====

Net unrealized capital gains (losses) and other adjustments consist of the
following items:

<CAPTION>
1996 1995 1994
----- ----- -----
(IN MILLIONS)
<S> <C> <C> <C>
Net gains (losses) from changes in security values and
book value adjustments................................... $ 3.7 $(0.2) $ 0.7
Increase in asset valuation reserve....................... (1.2) (2.8) (2.2)
----- ----- -----
Net Unrealized Capital Gains (Losses) and
Other Adjustments...................................... $ 2.5 $(3.0) $(1.5)
===== ===== =====
</TABLE>

NOTE 6--TRANSACTIONS WITH PARENT

The Company's Parent provides the Company with personnel, property and
facilities in carrying out certain of its corporate functions. The Parent
annually determines a fee for these services and facilities based on a number
of criteria which were revised in 1996, 1995, and 1994 to reflect continuing
changes in the Company's operations. The amount of the service fee charged to
the Company was $111.7 million, $97.9 million and $117.0 million in 1996,
1995, and 1994 respectively, which has been included in insurance and
investment expenses. The Parent has guaranteed that, if necessary, it will
make additional capital contributions to prevent the Company's stockholder's
equity from declining below $1.0 million.

The service fee charged to the Company by the Parent includes $1.6 million,
$1.8 million and $6.0 million for the years ended December 31, 1996, 1995, and
1994 respectively, representing the portion of the provision for retiree
benefit plans determined under the accrual method, including a provision for
the 1993 transition liability which is being amortized over twenty years, that
was allocated to the Company.

F-11
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 6--TRANSACTIONS WITH PARENT--(CONTINUED)

Effective January 1, 1994, the Company entered into a modified coinsurance
agreement with John Hancock to reinsure 50% of 1996, 1995 and 1994 issues of
flexible premium variable life insurance and scheduled premium variable life
insurance policies. In connection with this agreement, John Hancock
transferred $24.5 million of cash for tax, commission, and expense allowances
to the Company, which increased the Company's net gain from operations by
$15.7 million for the year ended December 31, 1996. The corresponding amounts
for the year ended December 31, 1995 were $32.7 million and $20.3 million,
respectively. The corresponding amounts for the year ended December 31, 1994
were $29.5 million and $26.9 million, respectively.

Effective January 1, 1996, the Company entered into a modified coinsurance
agreement with John Hancock to reinsure 50% of 1995 and 1996 issues of retail
annuity contracts (Independence Preferred and Declaration). In connection with
this agreement, John Hancock transferred $23.2 million of cash for surrender
benefits, tax, reserve increase, commission, expense allowances and premium to
the Company, which increased the Company's net gain from operations by $15.1
million in 1996.

NOTE 7--INVESTMENTS

The statement value and fair value of bonds are shown below:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1996
--------------------------------------
GROSS GROSS
STATEMENT UNREALIZED UNREALIZED FAIR
VALUE GAINS LOSSES VALUE
--------- ---------- ---------- ------
(IN MILLIONS)
<S> <C> <C> <C> <C>
U.S. Treasury securities and obligations
of U.S. government corporations and
agencies............................... $ 44.4 $ 0.2 $0.2 $ 44.4
Obligations of states and political
subdivisions........................... 12.6 0.4 0.0 13.0
Debt securities issued by foreign
governments............................ 0.8 0.1 0.0 0.9
Corporate securities.................... 623.2 29.8 3.4 649.6
Mortgage-backed securities.............. 72.5 10.2 0.1 82.6
------ ----- ---- ------
Totals................................ $753.5 $40.7 $3.7 $790.5
====== ===== ==== ======
<CAPTION>
YEAR ENDED DECEMBER 31, 1995
--------------------------------------
GROSS GROSS
STATEMENT UNREALIZED UNREALIZED FAIR
VALUE GAINS LOSSES VALUE
--------- ---------- ---------- ------
(IN MILLIONS)
<S> <C> <C> <C> <C>
U.S. Treasury securities and obligations
of U.S. government corporations and
agencies............................... $ 89.0 $ 0.5 $0.0 $ 89.5
Obligations of states and political
subdivisions........................... 11.4 1.1 0.0 12.5
Debt securities issued by foreign
governments............................ 1.3 0.2 0.0 1.5
Corporate securities.................... 445.6 44.1 1.6 488.1
Mortgage-backed securities.............. 5.5 0.3 0.1 5.7
------ ----- ---- ------
Totals................................ $552.8 $46.2 $1.7 $597.3
====== ===== ==== ======
</TABLE>

F-12
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 7--INVESTMENTS--(CONTINUED)

The statement value and fair value of bonds by contractual maturity, are
shown below. Maturities will differ from contractual maturities because
eligible borrowers may exercise their right to call or prepay obligations with
or without call or prepayment penalties.

<TABLE>
<CAPTION>
DECEMBER 31, 1996
-------------------
STATEMENT FAIR
VALUE VALUE
---------- --------
(IN MILLIONS)
<S> <C> <C>
Due in one year or less.................................... $ 51.6 $ 52.9
Due after one year through five years...................... 260.8 267.7
Due after five years through ten years..................... 244.3 253.7
Due after ten years........................................ 124.3 133.6
-------- --------
681.0 707.9
Mortgage-backed securities................................. 72.5 82.6
-------- --------
$ 753.5 $ 790.5
======== ========
</TABLE>

Proceeds from sales of bonds during 1996, 1995 and 1994 were $228.3 million,
$18.9 million and $23.1 million, respectively. Gross gains of $1.3 million in
1996, $0.2 million in 1995, and $0.0 million in 1994 and gross losses of $2.1
million in 1996, $0.1 million in 1995, and $0.1 million in 1994 were realized
on these transactions.

The cost of common stocks was $0.0 million, and $0.1 million December 31,
1996 and December 31, 1995, respectively. Gross unrealized appreciation on
common stocks totaled $1.4 million and gross unrealized depreciation totaled
$0.0 million at December 31, 1996. The fair value of preferred stock totaled
$9.6 million at December 31, 1996, and $5.2 million at December 31, 1995.

Mortgage loans with outstanding principal balances of $0.0 million and bonds
with amortized cost of $11.3 million were nonincome producing for the year
ended December 31, 1996. The corresponding amounts for the twelve months ended
December 31, 1995 were $1.1 million and $4.0 million, respectively.

The mortgage loan portfolio was diversified by geographic region and
specific collateral property type as displayed below. The Company controls
credit risk through credit approvals, limits and monitoring procedures.

<TABLE>
<CAPTION>
DECEMBER 31, 1996
------------------------------------------------------------------------------
STATEMENT GEOGRAPHIC STATEMENT
PROPERTY TYPE VALUE CONCENTRATION VALUE
------------- --------- ------------- ---------
(IN MILLIONS) (IN MILLIONS)
<S> <C> <C> <C>
Apartments..................... $ 96.0 East North Central $ 31.1
Industrial..................... 35.0 East South Central 11.5
Office buildings............... 11.3 Middle Atlantic 7.6
Retail......................... 29.0 Mountain 27.6
Agricultural................... 28.9 New England 49.9
Other.......................... 11.9 Pacific 58.8
South Atlantic 25.6
------ ------
$212.1 $212.1
====== ======
</TABLE>

F-13
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 7--INVESTMENTS--(CONTINUED)

At December 31, 1996, the fair values of the commercial and agricultural
mortgage loans portfolios were $189.0 million and $30.4 million, respectively.
The corresponding amounts as of December 31, 1995 were approximately $132.1
million and $22.2 million, respectively. The corresponding amounts as of
December 31, 1994 were approximately $118.8 million and $27.3 million,
respectively.

The maximum and minimum lending rates for mortgage loans during 1996 were
8.69% and 7.04% for agricultural loans and 8.5% and 7.2% for other properties.
Generally, the maximum percentage of any loan to the value of security at the
time of the loan, exclusive of insured or guaranteed or purchase money
mortgages, is 75%. For city mortgages, fire insurance is carried on all
commercial and residential properties at least equal to the excess of the loan
over the maximum loan which would be permitted by law on the land without the
building, except as permitted by regulations of the Federal Housing Commission
on loans fully insured under the provision of the National Housing Act. For
agricultural mortgage loans, fire insurance is not normally required on land
based loans except in those instances where a building is critical to the
farming operation. Fire insurance is required on all agri-business facilities
in an aggregate amount equal to the loan balance.

NOTE 8--REINSURANCE

The Company cedes business to reinsurers to share risks under variable life,
universal life and flexible variable life insurance policies for the purpose
of reducing exposure to large losses. Premiums, benefits and reserves ceded to
reinsurers during the year ended December 31, 1996 were $384.3 million, $9.9
million, and $12.1 million, respectively. The corresponding amounts in 1995
were $72.4 million, $8.7 million, and $12.1 million, respectively. The
corresponding amounts in 1994 were $67.5 million, $12.3 million, and $16.3
million, respectively.

To the extent that an assuming reinsurance company is unable to meet its
obligations under a reinsurance agreement, the Company remains liable as the
direct insurer on all risks reinsured.

NOTE 9--FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

The Company enters into interest rate swap contracts for the purpose of
converting the interest rate characteristics (fixed or variable) of certain
investments to match those of related insurance liabilities. Maturities of
current agreements range through 2011. These swaps involve, to varying
degrees, interest rate risk in excess of amounts recognized in the statement
of financial position.

The Company enters into currency rate swap agreements to manage exposure to
foreign exchange rate fluctuations. Maturities of current agreements range
through 2006. Should the counterparty fail to meet the terms of the contract,
the Company's market risk is limited to the currency rate differential.

The Company enters into interest rate cap contracts to manage exposure on
underlying security values due to a rise in interest rates. Maturities of
current agreements range through 2006.

The Company also uses financial futures contracts to hedge public bonds
intended for future sale in order to lock in the market value at the date of
contract. The Company is subject to the

F-14
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 9--FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK--(CONTINUED)

risks associated with changes in the value of the underlying securities;
however, such changes in value generally are offset by changes in the value of
the hedged items. The contract or notional amounts of the contracts represent
the extent of the Company's involvement but not in the future cash
requirements, as the Company intends to close the open positions prior to
settlement.

The contract or notional amount of the foregoing financial instruments,
which indicates the Company's involvement and in certain instances, maximum
credit risk related to those instruments, is as follows:

<TABLE>
<CAPTION>
DECEMBER 31
--------------
1996 1995
------- ------
(IN MILLIONS)
<S> <C> <C>
Futures contracts to sell securities......................... $ 73.0 $ 0.0
======= =====
Notional amount of interest rate swaps, currency rate swaps,
and interest rate caps to:
Receive variable rates..................................... $ 215.9 $ 0.0
======= =====
Receive fixed rates........................................ $ 26.6 $ 5.0
======= =====
</TABLE>

The Company continually monitors its positions and the credit ratings of the
counterparties to these financial instruments. The Company believes the risk
of incurring losses due to the nonperformance by its counterparties is remote
and that any such losses would be immaterial.

Based on the market rates in effect at December 31, 1996, the Company's
interest rate swaps, currency rate swaps and interest rate caps represented
(assets) liabilities to the Company with fair values of $2.3 million, $(8.2)
million and $(2.0) million, respectively. The corresponding amounts as of
December 31, 1995 were $0.0 million.

NOTE 10--POLICYHOLDERS' RESERVES AND BENEFICIARIES' FUND

The Company's annuity reserves and deposit fund liabilities that are subject
to discretionary withdrawal and subject to discretionary withdrawal (without
adjustment), are summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
1996 PERCENT
------------- -------
(IN MILLIONS)
<S> <C> <C>
Subject to discretionary withdrawal at book value
less surrender charge.............................. $441.9 89.3%
Subject to discretionary withdrawal at book value
(without adjustment)............................... 53.0 10.7
------ -----
Total annuity reserves and deposit liabilities...... $494.9 100.0%
====== =====
</TABLE>

F-15
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

NOTES TO STATUTORY-BASIS FINANCIAL STATEMENTS--(CONTINUED)

NOTE 11--COMMITMENTS AND CONTINGENCIES

The Company has extended commitments to purchase long-term bonds and real
estate and issue real estate mortgages totalling $42.1 million, $0.1 million,
and $33.5 million respectively, at December 31, 1996. The corresponding
amounts at December 31, 1995 were $16.6 million and $5.4 million,
respectively. The Company monitors the creditworthiness of borrowers under
long-term bond commitments and requires collateral as deemed necessary. If
funded, loans related to real estate mortgages would be fully collateralized
by the related properties. The fair values of the commitments described above
were $76.2 million at December 31, 1996 and $23.8 million at December 31,
1995. The majority of these commitments expire in 1997.

In the normal course of its business operations, the Company is involved in
litigation from time to time with claimants, beneficiaries and others, and a
number of litigation matters were pending as of December 31, 1996. It is the
opinion of management, after consultation with counsel, that the ultimate
liability with respect to these claims, if any, will not materially affect the
financial position of the Company.

NOTE 12--FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and fair values of the
Company's financial instruments:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
--------------------------------
1996 1995
--------------- ---------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
-------- ------ -------- ------
(IN MILLIONS)
<S> <C> <C> <C> <C>
Assets
Bonds--Note 7............................... $753.5 $790.5 $552.8 $597.3
Preferred stocks--Note 7.................... 9.6 9.6 5.0 5.2
Common stocks--Note 7....................... 1.4 1.4 1.7 1.7
Mortgage loans on real estate--Note 7....... 212.1 219.4 146.7 154.3
Policy loans--Note 2........................ 80.8 80.8 61.8 61.8
Cash and cash equivalents--Note 2........... 31.9 31.9 76.6 76.6
Derivatives liabilities relating to:--Note 9
Interest rate swaps......................... -- 2.3 -- 0.0
Currency rate swaps......................... -- (8.2) -- 0.0
Interest rate caps.......................... -- (2.0) -- 0.0
Liabilities
Commitments--Note 11........................ -- 76.2 -- 23.8
</TABLE>

The carrying amounts in the table are included in the statutory-basis
statements of financial position. The method and assumptions utilized by the
Company in estimating its fair value disclosures are described in Note 1.

F-16
<PAGE>

APPENDIX A - SAMPLE MARKET VALUE ADJUSTMENT CALCULATIONS

The formula which will be used to determine the Market Value Adjustment is:

n/12
1 + g
(-----------) -1
1 + c +.005

Sample Calculation 1: Positive Adjustment

<TABLE>
<S> <C>
Amount withdrawn or transferred $10,000
Guarantee Period 7 years
Time of withdrawal or transfer beginning of 3rd year of Guarantee Period
Guaranteed Rate (g) 8%*
Guaranteed Rate for
new 5-year guarantee (c) 7%*
Remaining Guarantee Period (n) 60 months
Market Value Adjustment:
</TABLE>

60/12
1 + .08
$10,000 x [(--------------) - 1] = $234.73
1 + .07 + .005

Amount transferred or withdrawn (adjusted for Market Value Adjustment):
$10,234.73

Sample Calculation 2: Negative Adjustment

<TABLE>
<S> <C>
Amount withdrawn or transferred $10,000
Guarantee Period 7 years
Time of withdrawal or transfer beginning of 3rd year of Guarantee Period
Guaranteed Rate (g) 8%*
Guaranteed Rate for
new 5-year guarantee (c) 9%*
Remaining Guarantee Period (n) 60 months
Market Value Adjustment:
</TABLE>

60/12
1 + .08
$10,000 x [(--------------) - 1] = $-666.42
1 + .09 + .005

Amount transferred or withdrawn (adjusted for Market Value Adjustment):
$9,333.58

<PAGE>

Sample Calculation 3: Negative Adjustment

<TABLE>
<S> <C>
Amount withdrawn or transferred $10,000
Guarantee Period 7 years
Time of withdrawal or transfer beginning of 3rd year of Guarantee Period
Guaranteed Rate (g) 8%*
Guaranteed Rate for
new 5-year guarantee (c) 7.75%*
Remaining Guarantee Period (n) 60 months
Market Value Adjustment:
</TABLE>

60/12
1 + .08
$10,000 x [(----------------) - 1] = $-114.94
1 + .0775 + .005

Amount transferred or withdrawn (adjusted for Market Value Adjustment):
$9,885.06

__________________________

. Assumed for illustrative purposes only.
<PAGE>

APPENDIX B - VARIABLE ANNUITY INFORMATION
FOR INDIVIDUAL RETIREMENT ANNUITIES

To help you understand your purchase of this Contract as an Individual
Retirement Annuity (IRA), we are providing the following summary.

I. Accumulation Units and the MVA Fixed Account. Each net premium payment you
make into your Contract is allocated to the Subaccounts and/or Guarantee
Periods you select. Accumulation Units are acquired under the Contract with
amounts you allocate to the Subaccounts. This is the unit of measurement used
to determine the value of the variable portion of your Contract. The number of
units acquired in any Subaccount is based on the unit value of that Subaccount
next determined after receipt of the payment at the Servicing Center. The
values of Accumulation Units fluctuate with the daily investment performance
of the corresponding Subaccount. The growth in the value of your Contract, to
the extent invested in the Separate Account, is neither guaranteed nor
projected and varies with the investment performance of the Fund underlying
the Subaccount you have selected. Each net premium payment allocated to a
Guarantee Period in the MVA Fixed Account will be credited interest, as
determined by the Company. A minimum guaranteed interest rate of 3% applies to
Contracts where required under state law. Amounts withdrawn or surrendered
from a Guarantee Period may be increased or decreased by a Market Value
Adjustment. More details appear under "Accumulation Period" and "The MVA Fixed
Account" in this prospectus.

II. Separate Account and Trust Charges. The assets of the Separate Account are
charged for services and certain expense guarantees. The annualized charge
equals a maximum of 1.25%. Trust fees varying by Fund are charged against the
Funds for investment management and advisory services, and other expenses.
Details appear under "Charges Under the Contracts" in this prospectus and in
the accompanying prospectus of the Trust.

III. Deductions from the Contract. The full amount of each premium payment,
net of any premium taxes deducted, is applied to the Contract. At or after the
payment dates, one or more of the following charges may be made, depending on
circumstances.

1. CDSL. In each Contract Year you may withdraw as much as 10% of the
Accumulated Value of your Contract as of the beginning of the Contract Year
without charge. Withdrawals in excess of this amount will be subject to the
following charges:

<TABLE>
<CAPTION>
Years from Date
of Premium Payment to CDSL
Date of Surrender or Withdrawal Charge
------------------------------- ------
<S> <C>
7 or more .............................................0%

6 but less than 7......................................2%

5 but less than 6......................................3%

4 but less than 5......................................4%

3 but less than 4......................................5%

2 but less than 3......................................5%

less than 2............................................6%
</TABLE>

For the purpose of calculating the CDSL, deposits are considered to be
withdrawn on a "first-in first-out" basis. Earnings are considered to be
withdrawn last, and are withdrawn without charge. Under certain
circumstances the CDSL is not assessed. This is described in more detail
under "Contingent Deferred Sales Load" under "Charges Under the Contracts"
in this prospectus.

2. Contract Fee. The Company currently deducts $30 from the
Accumulated Value as a Contract Fee if the Accumulated Value is less than
$10,000. This occurs annually or at the time of surrender. Please refer to
"Charges for Administrative Services" under "Charges Under the Contracts" in
this prospectus.

<PAGE>

3. STATE PREMIUM TAX. Some states and local governments impose a premium or
similar tax on annuities. The Company only deducts this tax when required to do
so. Please refer to "Premium or Similar Taxes" under "Changes Under Contracts"
in this prospectus.

4. OPTIONAL BENEFIT RIDERS. Three optional benefit riders are available
under the Contracts, including the One Year Stepped-Up Death Benefit, Accidental
Death Benefit and Nursing Home Waiver of CDSL riders. The charges for these
riders are 0.15%, 0.10% and 0.05% (annual percentage rates), respectively, of
Accumulated Value. Please refer to "Nursing Home Waiver of CDSL" and "Optional
Death Benefit Charges" under "Charges Under the Contracts."
<PAGE>

JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY

DEFERRED COMBINATION FIXED AND VARIABLE ANNUITY CONTRACTS

JOHN HANCOCK VARIABLE ANNUITY ACCOUNT JF

STATEMENT OF ADDITIONAL INFORMATION

___________________

This statement of additional information ("SAI"), dated May 1, 1997, is not
a prospectus. It is intended that this SAI be read in conjunction with the
prospectus of John Hancock Variable Annuity Account JF, dated May 1, 1997, for
the Contracts being offered. Capitalized terms used in this SAI that are not
otherwise defined herein have the same meanings given to them in the prospectus.
A copy of the prospectus may be obtained from the Servicing Center, P.O. Box
9298 , Boston Massachusetts, 02205-9298, telephone number (800) 824-0335.

<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
Cross Reference to
Page Pages in Prospectus
---- -------------------
<S> <C> <C>
The Separate Account....................2 15
Services Agreement......................2 NA
Calculation of Performance Data.........2 48
Calculation of Annuity Payments.........3 32
Separate Account Financial Statements...6 F-1
</TABLE>

1
<PAGE>

THE SEPARATE ACCOUNT

John Hancock Variable Annuity Account JF ("Separate Account") is a separate
account of John Hancock Variable Life Insurance Company ("Company"), established
under the laws of the Commonwealth of Massachusetts. The Separate Account is
organized as a unit investment trust and registered with the Securities and
Exchange Commission ("Commission") under the Investment Company Act of 1940, as
amended ("1940 Act"). The Separate Account has eleven separate subaccounts
("Subaccounts") that fund the variable portion of the Company's deferred
combination fixed and variable annuity contracts ("Contracts"). The individual
Contract owner ("Owner") may choose among the V.A. International, V.A. Financial
Industries, V.A. Emerging Growth, V.A. Discovery, V.A. Independence Equity, V.A
Sovereign Investors, V.A. 500 Index, V.A. Sovereign Bond, V.A. Strategic Income,
V.A. World Bond, and V.A. Money Market Subaccounts. The assets of each
Subaccount are, in turn, invested in a corresponding Fund of John Hancock
Declaration Trust ("Trust"), a registered open-end management investment company
advised by John Hancock Advisers, Inc. ("Adviser") and affiliated sub-advisers.
The Owner may also choose to fund the Contracts through the MVA Fixed Account,
providing Guaranteed Rates for various Guarantee Periods.

SERVICES AGREEMENT

John Hancock, on behalf of itself and the Company, and JHFI have entered
into a Responsibility and Cost Allocation Agreement ("Agreement") for the
allocation of services and related costs with respect to various functions,
duties and responsibilities associated with the Contracts and other variable
annuity contracts that may be offered by the Company or John Hancock. The
Agreement provides for the allocation of such matters as regulatory compliance,
insurance underwriting and issuance, pricing and unit valuation, accounting,
record maintenance, surrenders, benefit payments, commissions payments, reports
to annuity contract owners, and distribution and marketing. The cost of
performing the duties allocated will be borne by the party responsible for
discharging the function, unless agreed upon otherwise. John Hancock and JHFI
may delegate any of their respective duties to their susidiaries or affiliates.

CALCULATION OF PERFORMANCE DATA

The Separate Account may, from time to time, include in advertisements,
sales literature and reports to Owners or prospective investors information
relating to the performance of its Subaccounts. The performance information that
may be presented is not an estimate or a guarantee of future investment
performance, and does not represent the actual experience of amounts invested by
a particular Owner. Set out below is a description of the methods used in
calculating the performance information for the Subaccounts.

The Separate Account will calculate the average annual total return for
each Subaccount (other than the Money Market Subaccount), according to the
following formula prescribed by the Commission:

P(1+T) /n/ = ERV

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

Average annual total return is the annual compounded rate of return that
would have produced the cash redemption value under a Contract had the
Subaccount been invested in a specified Fund of the Trust over the stated period
and had the performance remained constant throughout. The calculation assumes a
single $1,000 payment made at the beginning of the period and full redemption at
the end of the period. It reflects adjustments for all Trust and Contract level
charges except any premium tax charge or charges for optional benefits described
in the prospectus.

On the basis, the following table shows the average total return for each
subaccount for the periods ended December 31, 1996:
<TABLE>
<CAPTION>
Average Annualized
Subaccount* ------------------
- -----------

Year to Date of
Date 1 Year Inception
---- ------ ---------
<S> <C> <C>
V.A. International 21.41% 8/29/96
V.A. Emerging Growth -31.47% 8/29/96
V.A. Discovery -30.35% 8/29/96
V.A. Independence Equity 18.20% 8/29/96
V.A. 500 Index 17.27% 8/29/96
V.A. Sovereign Investors 7.16% 8/29/96
V.A. World Bond -2.29% 8/29/96
V.A. Strategic Income 4.87% 8/29/96
V.A. Sovereign Bond -.96% 8/29/96
V.A. Money Market 8/29/96
</TABLE>

* Absent expense reimbursements to certain Portfolios, total return figures for
the related subaccounts would have been lower.

The Separate Account will calculate current yield for each Subaccount
(other than the Money Market Subaccount) according to the following formula
prescribed by the Commission:

2
<PAGE>

Yield = 2[( a-b )/6/]
[(---- + 1)- 1]
[( cd ) ]

where: a = net investment income earned during the period by the Fund
whose shares are owned by the Subaccount

b = expenses accrued for the period (net of any reimbursements)

c = the average daily number of Accumulation Units outstanding
during the period

d = the maximum offering price per Accumulation Unit on the last
day of the period.

According to this formula, yield is determined by dividing the net
investment income per Accumulation Unit earned during the period (minus the
deduction for mortality and expense risk charge, administration charge and
Contract Fee) by the Accumulation Unit Value on the last day of the period and
annualizing the resulting figure. The calculation is based on specified 30-day
periods identified in the advertisement. Neither the CDSL nor any charges for
premium taxes or optional benefits are reflected in the calculation.

The Separate Account may calculate current yield and effective yield
figures for the Money Market Subaccount. The current yield of the Money Market
Subaccount for a seven-day period ("base period") will be computed by
determining the "net change in value" (calculated as set forth below) of a
hypothetical Owner account having a balance of one Unit at the beginning of the
period, dividing the net change in account value by the value of the account at
the beginning of the base period to obtain the base period return, and
multiplying the base period return by 365/7 with the resulting yield figure
carried to the nearest hundredth of one percent. Net changes in value of the
hypothetical Owner account will include net investment income of that account
(accrued daily dividends as declared by the Money Market Fund, less daily
expense charges of the Separate Account) for the period, but will not include
realized gains or losses or unrealized appreciation or depreciation on the
underlying Money Market Fund shares. The mortality and expense risk charges,
administration charge and Contract Fee are reflected, but the CDSL and any
charge for premium taxes and optional benefits are not.

The effective yield reflects the effects of compounding and represents an
annualization of the current return with all dividends reinvested. The formula
for effective yield, as prescribed by the Commission, is:

Effective yield = [(Base period return + 1)/(365/7)/] - 1

CALCULATION OF ANNUITY PAYMENTS

The variable monthly annuity payment to an Annuitant under a Contract is
equal to the sum of the products of the number of each Subaccount's Annuity
Units credited to the Contract multiplied by the applicable Annuity Unit Value,
as these terms are defined under "Special Terms" and "Variable Account Valuation
Procedures," respectively, in the Account's prospectus. The number of each
Subaccount's Annuity Units credited to the Contract is multiplied by the
applicable Annuity Unit Value as of ten calendar days prior to the date the
payment is due. The value of the Annuity Units varies from day to day, depending
on the investment performance of the Subaccount, the deductions made against the
Subaccount, and the assumed investment rate used in computing Annuity Unit
Values. Thus, the variable monthly annuity payments vary in amount from month to
month.

The amount of the initial variable monthly payment is determined on the
assumption that the actual net investment rate of each Subaccount used in
calculating the Net Investment Factor (as described under "Variable Account
Valuation Procedures" in the Account's prospectus) will be equal on an annual
basis to the assumed investment rate. If the actual net investment rate between
the dates for determining two monthly annuity

3
<PAGE>

payments is greater than the assumed investment rate, the latter monthly payment
will be larger in amount than the former. On the other hand, if the actual net
investment rate between the dates for determining two monthly annuity payments
is less than the assumed investment rate, the latter monthly payment will be
smaller in amount than the former.

The mortality tables used as a basis for both variable and fixed annuity
purchase rates are the 1983a Mortality Tables, with projections of mortality
improvements and with certain age adjustments based on the Contract Year of
annuitization. The mortality table used in a Contract purchased in connection
with certain employer-related plans and used in all Contracts issued in Montana
will be the Female Annuity Table of the 1983a Mortality Tables. The impact of
this change will be lower benefits (5% to 15%) from a male's viewpoint than
would otherwise be the case.

An illustration of the method of calculation of variable monthly annuity
payments and the number of Annuity Units under the Contracts is shown below.

GENERAL FORMULAE TO DETERMINE ACCUMULATION UNIT VALUES AND ANNUITY UNIT VALUES

Net Investment Rate =

<TABLE>
<CAPTION>
Subaccount Charges (0.003425% per
Investment Capital Capital Taxes Day of the Value of the Subaccount at
Income + Gains - Losses - (if any) - the Beginning of the Valuation Period)*
- ------------------------------------------------------------------------------------------------------------
Value of the Subaccount at the Beginning of the Valuation Period
<S> <C> <C> <C> <C>
Net Investment
Factor = 1.00000000 + Net Investment Rate

Accumulation Accumulation Unit Value on Net Investment
Unit Value = Preceding Valuation Date X Factor

Annuity Unit Net
Annuity Unit Value on Preceding Investment Factor to Neutralize
Value = Valuation Date X Factor X Assumed Investment Rate
</TABLE>

_________________________

/*/ The 0.003425% daily charge is based on charges for mortality and expense
risk and administration at the annual rate of 1.25%. A lower decimal amount
of daily charge would apply under the 1.00% annual rate. See "Charges Under
the Contracts" in the prospectus.

4
<PAGE>

HYPOTHETICAL EXAMPLE ILLUSTRATING THE CALCULATION OF ACCUMULATION UNIT VALUES
AND ANNUITY UNIT VALUES

Assume at the beginning of the Valuation Period being considered, the value
of a particular Subaccount was $4,000,000. Investment income during the
Valuation Period totaled $2000 while capital gains were $3000 and capital losses
were $1000. No taxes accrued. Charges against the beginning value of the
Subaccount amount to [$137.00] assuming a one day Valuation Period. The
[$137.00] was computed by multiplying the beginnings Subaccount value of
$4,000,000 by the factor [0.00003425]. By substituting in the first formula
above, the net investment rate is equal to [$3863.00 ($2000 + $3000 - $1000 -
$137.00)] divided by $4,000,000 or [0.0009658.] The Net Investment Factor would
then be [1.0009658].

Assume further that each Accumulation Unit had a value of $11.250000 on the
previous Valuation Date, and the value of an Annuity Unit on such date was
$1.0850000. Based upon the experience of the Subaccount during the Valuation
Period, the value of an Accumulation Unit at the end of the Valuation Period
would be [$11.260865 ($11.250000 x 1.0009658)]. The value of an Annuity Unit at
the end of the Valuation Period would be [$1.085946 ($1.0850000 x 1.0009658 x
.99990575)]. The final figure, [.99990575], neutralizes the effect of a 3 1/2%
assumed investment rate so that the Annuity Unit recognizes only the actual
investment experience.

GENERAL FORMULAE TO DETERMINE AMOUNT OF MONTHLY VARIABLE ANNUITY PAYMENTS AND
NUMBER OF ANNUITY UNITS

Amount of First Variable Annuity Payment =

<TABLE>
<CAPTION>
First
Number of Monthly
Accumulation Accumulation Unit Value Annuity
Shares Applied X 10 Days Before Maturity Date X Payment
- -----------------------------------------------------------
<S> <C> <C> <C> <C>
$1000 Factor

Number of
Annuity Units = Amount of First Variable Annuity Payment
------------------------------------------------
Annuity Unit Value 10 Days Before Maturity Date

Amount of Annuity Unit
Subsequent Variable Value 10 Days
Annuity Payment = Number of Annuity Units X Before Date
</TABLE>

HYPOTHETICAL EXAMPLE ILLUSTRATING THE CALCULATION OF THE AMOUNT OF MONTHLY
VARIABLE ANNUITY PAYMENT

Assume that 10 days before the date of maturity a Contract has credited to
it 4000.000 Accumulation Units each having a value of $12.000000. The
appropriate annuity purchase rate in the Contract for an assumed investment rate
of 3 1/2% is $5.47 per $1000 of proceeds for the Annuity Option elected. The
Annuitant's first monthly payment would then be $262.56.

5
<PAGE>

4000.000 x $12.000000 x 5.47
----------------------
$1000

If the value of an Annuity Unit 10 days before the date of maturity was
$1.4000000, the number of Annuity Units represented by the first and subsequent
payments would be $187.543 ($262.56/$1.4000000). If the Annuity Unit Value 10
days before the due date of the second monthly payment was $1.405000, the amount
of the second payment would be $263.50 (187.543 x $1.405000).

SEPARATE ACCOUNT FINANCIAL STATEMENTS

The financial statements for the Separate Account are included on the next
page.

<PAGE>

Report of Independent Auditors

Contractowners
John Hancock Variable Annuity Account JF
of John Hancock Variable Life Insurance Company

We have audited the accompanying statement of assets and liabilities of John
Hancock Variable Annuity Account JF (the Account) (comprising, respectively, the
V.A. Independence Equity, V.A. Sovereign Bond, V.A. Discovery, V.A. World Bond,
V.A. International, V.A. Emerging Growth, V.A. Money Market, V.A. Strategic
Income, V.A. Sovereign Investors and V.A. 500 Index Subaccounts) as of December
31, 1996, and the related statements of operations and changes in net assets for
the period from August 29, 1996 (commencement of operations) to December 31,
1996. These financial statements are the responsibility of the Account's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of each of the respective
subaccounts constituting John Hancock Variable Annuity Account JF at December
31, 1996, and the results of their operations and the changes in their net
assets for the period from August 29, 1996 (commencement of operations) to
December 31, 1996, in conformity with generally accepted accounting principles.

ERNST & YOUNG LLP

Boston, Massachusetts
February 7, 1997

1
<PAGE>

John Hancock Variable Annuity Account JF

Statement of Assets and Liabilities

December 31, 1996

<TABLE>
<CAPTION>
V.A. V.A.
Independence Sovereign V.A. V.A. V.A.
Equity Bond Discovery World Bond International
Subaccount Subaccount Subaccount Subaccount Subaccount
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Investment in shares of portfolios
of Declaration Trust, at value $30,719 $12,336 $54,845 $999 $12,908
Receivable from Declaration Trust 1 - 2 - -
----------------------------------------------------------------------------------
Total assets 30,720 12,336 54,847 999 12,908

Liabilities
Asset charges payable 1 - 2 - -
----------------------------------------------------------------------------------
Total liabilities 1 - 2 - -
----------------------------------------------------------------------------------

Net assets $30,719 $12,336 $54,845 $999 $12,908
==================================================================================
<CAPTION>

V.A. V.A. V.A. V.A.
Emerging Money Strategic Sovereign V.A.
Growth Market Income Investors 500 Index
Subaccount Subaccount Subaccount Subaccount Subaccount
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Investment in shares of portfolios
of Declaration Trust, at value $40,856 $105,157 $2,015 $28,439 $147,147
Receivable from Declaration Trust 1 3 - 1 5
--------------------------------------------------------------------------------
Total assets 40,857 105,160 2,015 28,440 147,152

Liabilities
Asset charges payable 1 3 - 1 5
--------------------------------------------------------------------------------
Total liabilities 1 3 - 1 5
--------------------------------------------------------------------------------

Net assets $40,856 $105,157 $2,015 $28,439 $147,147
================================================================================
</TABLE>

See accompanying notes.

2
<PAGE>

John Hancock Variable Annuity Account JF

Statement of Operations

Period from August 29, 1996 (commencement of operations)

to December 31, 1996

Expenses:
Mortality and expense risks 28 9 62 1 8
---------------------------------------------------------------------------------
Net investment income (loss) 159 97 (62) 4 42

Net realized and unrealized gain (loss)
on investments:
Net realized gain (loss) - - (9) - -
Net unrealized appreciation
(depreciation) during the period (191) (61) (1,353) (3) 572
---------------------------------------------------------------------------------
Net realized and unrealized gain (loss)
on investments (191) (61) (1,362) (3) 572
---------------------------------------------------------------------------------

Net increase (decrease) in net assets
resulting from operations $ (32) $ 36 $(1,424) $ 1 $614
=================================================================================

<CAPTION>
V.A. V.A. V.A. V.A.
Emerging Money Strategic Sovereign V.A.
Growth Market Income Investors 500 Index
Subaccount Subaccount Subaccount Subaccount Subaccount
-----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment income:
Distributions received from the
portfolios of Declaration Trust $ 79 $316 $ 28 $ 236 $ 9,472

Expenses:
Mortality and expense risks 36 45 2 22 232
-----------------------------------------------------------------------------------
Net investment income (loss) 43 271 26 214 9,240

Net realized and unrealized gain (loss)
on investments
Net realized gain (loss) (1) - - - 2
Net unrealized appreciation
(depreciation) during the period (855) - (13) (389) (8,379)
-----------------------------------------------------------------------------------
Net realized and unrealized gain (loss)
on investments (856) - (13) (389) (8,377)
-----------------------------------------------------------------------------------

Net increase (decrease) in net assets
resulting from operations $(813) $271 $ 13 $(175) $ 863
===================================================================================
</TABLE>

See accompanying notes.

3
<PAGE>

John Hancock Variable Annuity Account JF

Statement of Changes in Net Assets

Period from August 29, 1996 (commencement of operations)

to December 31, 1996

V.A. V.A.
Independence Sovereign V.A. V.A. V.A.
Equity Bond Discovery World Bond International
Subaccount Subaccount Subaccount Subaccount Subaccount
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
from operations:
Net investment income (loss) $ 159 $ 97 $ (62) $ 4 $ 42
Net realized gain (loss) - - (9) - -
Net unrealized appreciation
(depreciation) during the period (191) (61) (1,353) (3) 572
----------------------------------------------------------------------------------
Net increase (decrease) in net assets
from operations (32) 36 (1,424) 1 614

From contractowner transactions:
Net premiums from contractowners 30,751 12,300 56,269 998 12,294
Net benefits to contractowners - - - - -
----------------------------------------------------------------------------------
Net increase in net assets from
contractowner transactions 30,751 12,300 56,269 998 12,294
----------------------------------------------------------------------------------

Net increase in net assets 30,719 12,336 54,845 999 12,908
Net assets at beginning of period - - - - -
----------------------------------------------------------------------------------

Net assets at end of period $30,719 $12,336 $54,845 $999 $12,908
==================================================================================
<CAPTION>

V.A. V.A. V.A. V.A.
Emerging Money Strategic Sovereign V.A.
Growth Market Income Investors 500 Index
Subaccount Subaccount Subaccount Subaccount Subaccount
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
from operations
Net investment income (loss) $ 43 $ 271 $ 26 $ 214 $ 9,240
Net realized gain (loss) (1) - - - 2
Net unrealized appreciation
(depreciation) during the period (855) - (13) (389) (8,379)
-------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from operations (813) 271 13 (175) 863

From contractowner transactions:
Net premiums from contractowners 41,669 104,906 2,002 28,614 146,284
Net benefits to contractowners - (20) - - -
-------------------------------------------------------------------------------------
Net increase in net assets from
contractowner transactions 41,669 104,886 2,002 28,614 146,284
-------------------------------------------------------------------------------------

Net increase in net assets 40,856 105,157 2,015 28,439 147,147
Net assets at beginning of period - - - - -
-------------------------------------------------------------------------------------

Net assets at end of period $40,856 $105,157 $2,015 $28,439 $147,147
=====================================================================================
</TABLE>

See accompanying notes.

4
<PAGE>

John Hancock Variable Annuity Account JF

Notes to Financial Statements

December 31, 1996

1. Organization

John Hancock Variable Annuity Account JF (the Account) is a separate investment
account of John Hancock Variable Life Insurance Company (JHVLICO), a wholly-
owned subsidiary of John Hancock Mutual Life Insurance Company (John Hancock).
The Account was created and commenced operations on August 29, 1996. The
Account was formed to fund variable annuity contracts (Contracts) issued by
JHVLICO. The Account is operated as a unit investment trust registered under
the Investment Company Act of 1940, as amended, and currently consists of ten
subaccounts. The assets of each subaccount are invested exclusively in shares
of a corresponding Portfolio of John Hancock Funds' Declaration Trust (the
Fund). New subaccounts may be added as new Portfolios are added to the Fund, or
as other investment options are developed, and made available to contractowners.
The ten Portfolios of the Fund which are currently available are V.A.
Independence Equity, V.A. Sovereign Bond, V.A. Discovery, V.A. World Bond, V.A.
International, V.A. Emerging Growth, V.A. Money Market, V.A. Strategic Income,
V.A. Sovereign Investors and V.A. 500 Index. Each Portfolio has a different
investment objective.

The net assets of the Account may not be less than the amount required under
state insurance law to provide for death benefits (without regard to the minimum
death benefit guarantee) and other contracts benefits. Additional assets are
held in JHVLICO's general account to cover the contingency that the guaranteed
minimum death benefit might exceed the death benefit which would have been
payable in the absence of such guarantee.

The assets of the Account are the property of JHVLICO. The portion of the
Account's assets applicable to the contracts may not be charged with liabilities
arising out of any other business JHVLICO may conduct.

2. Significant Accounting Policies

Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

5
<PAGE>

John Hancock Variable Annuity Account JF

Notes to Financial Statements (continued)

2. Significant Accounting Policies (continued)

Valuation of Investments

Investment in shares of the Fund are valued at the reported net asset values of
the respective Portfolios. Investment transactions are recorded on the trade
date. Dividend income is recognized on the ex-dividend date. Realized gains
and losses on sales of fund shares are determined on the basis of identified
cost.

Federal Income Taxes

The operations of the Account are included in the federal income tax return of
JHVLICO, which is taxed as a life insurance company under the Internal Revenue
Code. JHVLICO has the right to charge the Account any federal income taxes, or
provision for federal income taxes, attributable to the operations of the
Account or to the contracts funded in the Account. Currently, JHVLICO does not
make a charge for income or other taxes. Charges for state and local taxes, if
any, attributable to the Account may also be made.

Expenses

JHVLICO assumes mortality and expense risks of the contracts for which asset
charges are deducted at various rates ranging from .50% to .625%, depending on
the type of contract, of net assets of the Account. In addition, a monthly
charge at varying levels for the cost of insurance is deducted from the net
assets of the Account.

JHVLICO makes certain deductions for administrative expenses and state premium
taxes from premium payments before amounts are transferred to the Account.

3. Transaction with Affiliates

John Hancock Advisers, Inc. acts as the distributor, principal underwriter and
investment advisor for the Fund.

Certain officers of the Account are officers and directors of JHVLICO, the Fund,
John Hancock Advisers, Inc., or John Hancock.

6
<PAGE>

John Hancock Variable Annuity Account JF

Notes to Financial Statements (continued)

4. Details of Investments

The details of the shares owned and cost and value of investments in the
Portfolios of the Fund at December 31, 1996 were as follows:

Shares
Portfolio Owned Cost Value
- ------------------------------------------------------------
<S> <C> <C> <C>
V.A. Independence Equity 2,765 $ 30,910 $ 30,719
V.A. Sovereign Bond 1,211 12,397 12,336
V.A. Discovery 5,841 56,198 54,845
V.A. World Bond 98 1,002 999
V.A. International 1,149 12,336 12,908
V.A. Emerging Growth 4,384 41,711 40,856
V.A. Money Market 105,157 105,157 105,157
V.A. Strategic Income 196 2,028 2,015
V.A. Sovereign Investors 2,648 28,828 28,439
V.A. 500 Index 14,095 155,526 147,147
</TABLE>

Purchases, including reinvestment of dividend distributions and proceeds from
sales of shares in the Portfolios of the Fund during 1996, were as follows:

Portfolio Purchases Sales
- --------------------------------------------
<S> <C> <C>
V.A. Independence Equity $ 12,385 $ 9
V.A. Sovereign Bond 30,910 26
V.A. Discovery 56,871 653
V.A. World Bond 1,003 1
V.A. International 12,342 7
V.A. Emerging Growth 41,745 32
V.A. Money Market 105,223 66
V.A. Strategic Income 2,019 2
V.A. Sovereign Investors 29,288 520
V.A. 500 Index 148,439 226
</TABLE>

7
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Not Applicable

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Pursuant to Section X of the Company's By-Laws and Section 67 of the
Massachusetts Business Corporation Law, the Company indemnifies each director,
former director, officer, and former officer, and his or her heirs and legal
representatives from liability incurred or imposed in connection with any legal
action in which he or she may be involved by reason of any alleged act or
omission as an officer or a director of the Company. No indemnification shall be
paid if a director or officer is finally adjudicated not to have acted in good
faith in the reasonable belief that his or her action was in the best interest
of the Company. The Company may pay expenses incurred in defending an action or
claim in advance of its final disposition, but only upon receipt of an
undertaking by the person indemnified to repay such amounts if he or she should
be determined not to be entitled to indemnification.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Not Applicable

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

1(a). Distribution Agreement by and between John Hancock Mutual Life Insurance
Company and John Hancock Variable Life Insurance Company, dated August
26, 1993, incorporated by reference from Pre-Effective Amendment No. 1
to initial Form S-6 Registration Statement for John Hancock Variable
Life Account S (File No. 33-64366) filed October 29, 1993.

II-1
<PAGE>

1(b). Amendment dated August 1, 1994, to Distribution Agreement by and between
John Hancock Mutual Life Insurance Company and John Hancock Variable
Life Insurance Company, dated August 26, 1993, incorporated by reference
from Form N-4 Registration Statement for John Hancock Variable Annuity
Account I (File No. 33-82648), filed August 10, 1994.

1(c). Form of Variable Annuity Marketing and Distribution Agreement Between
John Hancock Mutual Life Insurance Company, and John Hancock Funds,
Inc., filed electronically on July 16, 1996.

1(d). Form of Soliciting Dealer Agreement between John Hancock Funds, Inc.,
and soliciting broker-dealers or financial institutions participating in
distribution of Contracts. (Included as Appendix B to Exhibit 3(c).)

3(a). Articles of Organization of John Hancock Variable Life Insurance
Company, incorporated by reference from Form S-1 Registration Statement
of John Hancock Variable Life Insurance Company (File No. 33-62895)
filed electronically on September 22, 1995.

3(b). By-Laws of John Hancock Variable Life Insurance Company, incorporated by
reference from Form S-1 Registration Statement of John Hancock Variable
Life Insurance Company (File No. 33-62895) filed electronically on
September 22, 1995.

4(a). Form of group deferred combination fixed and variable annuity contract,
filed electronically on July 16, 1996.

4(b). Form of group deferred combination fixed and variable annuity
certificate, filed electronically on July 16, 1996.

4(d). Form of nursing home waiver of CDSL rider, filed electronically on
December 2, 1995.

4(e). Form of one year stepped-up death benefit rider, filed electronically on
December 2, 1995.

II-2

<PAGE>

4(f). Form of accidental death benefit rider, filed electronically on December
2, 1995.

4(g). Form of contract application, filed electronically on December 2, 1995.

5. Opinion and consent of counsel, filed electronically on July 16, 1996.

10. Form of Responsibility and Cost Allocation Agreement Between John
Hancock Mutual Life Insurance Company and John Hancock Funds, Inc.,
filed electronically on July 16, 1996.

23(a). Consent of independent auditors.

23(b). Consent of counsel. (See Exhibit 5.)

24. Powers of Attorney, for all directors except, Ronald J. Bocage,
Incorporated by reference from Form S-1 Registration Statement for John
Hancock Variable Life Insurance Company, filed September 25, 1995 (file
no. 33-62895). Power of Attorney for Ronald J. Bocage, incorporated by
reference from Form 10-K annual report for John Hancock Variable Life
Insurance Company (File No. 33-62895) filed March 31, 1997.

27. Financial Data Schedule with respect to Financial Statements of John
Hancock Variable Life Insurance Company.

ITEM 17. UNDERTAKINGS

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:

i. To include any Prospectus required by Section 10(a)(3) of the
Securities Act of 1933;

ii. To reflect in the Prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement;

iii. To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;

(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

II-3
<PAGE>

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer, or controlling person of the registrant
in the successful defense of any action, suit, or proceeding) is asserted by
such director, officer, or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion or its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

(c) Registrant represents that the fees and charges deducted under the
Contracts, are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by the insurance company.

II-4
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS AMENDMENT TO THE REGISTRATION STATEMENT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF BOSTON,
COMMONWEALTH OF MASSACHUSETTS, ON THE 17th DAY OF APRIL 1997.

JOHN HANCOCK VARIABLE LIFE
INSURANCE COMPANY (REGISTRANT)

By /s/HENRY D. SHAW
-------------------------------
Henry D. Shaw
Vice Chairman of the Board
and President

AS REQUIRED BY THE SECURITIES ACT OF 1933, THIS AMENDMENT TO THE
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THEIR
CAPACITIES WITH JOHN HANCOCK VARIABLE LIFE INSURANCE COMPANY AND ON THE DATES
INDICATED.

<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----

/s/ROBERT R. REITANO Director (Principal April 16, 1997
- ------------------------ Financial Officer)
Robert R. Reitano

/s/PATRICK F. SMITH Controller (Principal April 17, 1997
- ------------------- Accounting Officer)
Patrick F. Smith

/s/HENRY D. SHAW Vice Chairman April 16, 1997
- ------------------
Henry D. Shaw and President
for himself and as (Acting Principal
Attorney-in-Fact Executive Officer)

FOR: David F. D'Alessandro Chairman of the Board
Robert S. Paster Director
Michelle G. Van Leer Director
Joseph A. Tomlinson Director
Barbara L. Luddy Director
Ronald J. Bocage Director
</TABLE>

II-5

<PAGE>

EXHIBIT 23(a)

Consent of Independent Auditors

We consent to the reference to our firm under the caption "Experts" and to the
use of our reports dated February 7, 1997, with respect to the financial
statements of John Hancock Variable Annuity Account JF, and February 14, 1997,
with respect to the financial statements of John Hancock Variable Life Insurance
Company, included in the Post-Effective Amendments No. 1 to the Registration
Statements (Form S-1 No. 33-64945 and Form N-4 No. 33-64947) and the related
Prospectus of John Hancock Variable Annuity Account JF.

ERNST & YOUNG LLP

Boston, Massachusetts
April 14, 1997

<PAGE>

<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM" AND IS
QUALIFIED IN ITS ENTIRETY BY REFERNCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<DEBT-HELD-FOR-SALE> 758,765,418
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 83,041,099
<MORTGAGE> 212,118,221
<REAL-ESTATE> 38,808,815
<TOTAL-INVEST> 1,092,733,553
<CASH> 26,619,996
<RECOVER-REINSURE> 618,682
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