FIRST INVESTORS LIFE LEVEL PREMIUM VARIABLE LIF INS SEP AC B, 497, 1996-04-30

FIRST INVESTORS LIFE LEVEL PREMIUM VARIABLE LIF INS SEP AC B
497, 1996-04-30

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Level Premium Variable Life Insurance Policies

Issued By
First Investors Life Insurance Company

95 Wall Street, New York, N.Y. 10005/(212) 858-8200

Investors are advised to read and retain this Prospectus for future
reference.

This Prospectus describes the Level Premium Variable Life Insurance Policy
(the "Policy") offered by First Investors Life Insurance Company ("First
Investors Life"). The purpose of the Policy is to provide life insurance
coverage and to lessen the economic loss resulting from the death of the
Insured.

Policy premiums net of certain expenses ("net annual premiums") are paid
into First Investors Life Insurance Company Separate Account B ("Separate
Account B"). A Policyowner elects to have his or her net annual premiums paid
into one or more of the nine subaccounts of Separate Account B ("Subaccounts").
The assets of each Subaccount are invested at net asset value in shares of a
related series of First Investors Life Series Fund (the "Life Series Fund"), an
open-end diversified management investment company. Target Maturity 2007 Fund
and Target Maturity 2010 Fund are not offered to Policyowners of Separate
Account B.

The Policy is similar to a limited payment whole life insurance policy
with a death benefit, level premiums, loan privileges and other features that
are usually associated with a limited payment insurance policy. Unlike the usual
whole life insurance policy, the Policy is "variable" because the amount of the
insurance coverage and the cash values may increase or decrease depending on the
investment performance of the chosen Subaccount or Subaccounts of Separate
Account B.

The death benefit during the first Policy year will be the face amount
shown on the Policy (the "Guaranteed Insurance Amount"). On each Policy
anniversary, the amount of coverage may increase or decrease depending on the
investment results of the designated Subaccount or Subaccounts, but it will
never be less than the Guaranteed Insurance Amount as long as there is no
outstanding Policy loan and premiums are paid when due.

The cash value of the Policy will vary from day to day, depending on the
investment results of the designated Subaccount or Subaccounts, but with no
guaranteed minimum. The Policyowner bears the entire investment risk and the
Policy's cash value (not the death benefit) could decline to zero.

Replacing existing insurance with the Policy described in this Prospectus
may not be to your advantage because, among other things, of the cost of the
Policy during the first few years.

This Prospectus sets forth the information about the Policies and Separate
Account B that a prospective investor should know before investing and should be
kept for future reference.

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

THIS PROSPECTUS IS VALID ONLY WHEN ATTACHED TO THE
CURRENT PROSPECTUS FOR FIRST INVESTORS LIFE SERIES FUND.

The date of this Prospectus is April 29, 1996

<PAGE>

THE PURPOSE OF THE POLICY IS TO PROVIDE LIFE INSURANCE PROTECTION FOR THE
BENEFICIARY NAMED IN THE POLICY. NO CLAIM IS MADE THAT THE POLICY IS IN ANY WAY
SIMILAR OR COMPARABLE TO A SYSTEMATIC INVESTMENT PLAN OF A MUTUAL FUND.

GENERAL DESCRIPTION

First Investors Life Insurance Company

First Investors Life Insurance Company (TIN 13-1968606), 95 Wall Street, New
York, New York 10005 ("First Investors Life"), a stock life insurance company
incorporated under the laws of the State of New York in 1962, writes life
insurance, annuities and accident and health insurance. In addition to Separate
Account B, First Investors Life also maintains First Investors Life Variable
Annuity Fund A and First Investors Life Variable Annuity Fund C. Variable
annuity contracts funded through those accounts are offered through their own
prospectuses. First Investors Consolidated Corporation ("FICC") owns all of the
voting common stock of First Investors Management Company, Inc. ("FIMCO" or
"Adviser") and all of the outstanding stock of First Investors Life, First
Investors Corporation ("FIC" or "Underwriter") and the Transfer Agent. Mr. Glenn
O. Head controls FICC and, therefore, controls the Adviser.

First Investors Life assumes all of the insurance risks under the Policy and
its assets support the Policy's benefits. At December 31, 1995, First Investors
Life had assets of over $512 million and over $3.055 billion of life insurance
in force. (See First Investors Life's financial statements under "Financial
Statements.")

Separate Account B

First Investors Life Insurance Company Separate Account B, also known by its
proprietary name, "Insured Series Plan" ("Separate Account B"), was established
on June 4, 1985 under the provisions of the New York Insurance Law. Separate
Account B is a separate investment account to which assets are allocated to
support the benefits under the Life Level Premium Variable Life Insurance Policy
(the "Policy") offered by First Investors Life. Separate Account B is registered
as a unit investment trust under the Investment Company Act of 1940, as amended
(the "1940 Act"), but such registration does not involve any supervision of the
management or investment practices or policies of Separate Account B.

The assets of each subaccount of Separate Account B (the "Subaccount") are
invested at net asset value in shares of the corresponding Fund (singularly,
"Fund," and collectively, "Funds") of Life Series Fund. For example, the Blue
Chip Subaccount invests in the Blue Chip Fund, the Government Subaccount invests
in the Government Fund, and so on. Life Series Fund's Prospectus describes the
risks attendant to an investment in each Fund.

Any and all distributions received from a Fund will be reinvested to purchase
additional shares of the distributing Fund at net asset value for the
corresponding Subaccount. Accordingly, no capital distributions are anticipated.
Shares of the Funds in the Subaccounts will be valued at their net asset value.

Separate Account B is divided into the following Subaccounts, each of which
corresponds to the following Fund of Life Series Fund:

<PAGE>

Separate Account
B Subaccount Fund
-------------------- ------------------
Blue Chip Subaccount Blue Chip Fund
Cash Management Subaccount Cash Management Fund
Discovery Subaccount Discovery Fund
Government Subaccount Government Fund
Growth Subaccount Growth Fund
High Yield Subaccount High Yield Fund
International Securities Subaccount International Securities Fund
Investment Grade Subaccount Investment Grade Fund
Utilities Income Subaccount Utilities Income Fund

The assets of Separate Account B are the property of First Investors Life.
Each Policy provides that the portion of the assets of Separate Account B equal
to the reserves and other liabilities under the Policy with respect to Separate
Account B shall not be chargeable with liabilities arising out of any other
business that First Investors Life may conduct. In addition to the net assets
and other liabilities for the Policies, the assets of Separate Account B include
amounts derived from expenses charged to Separate Account B by First Investors
Life (see "Charges and Expenses"). From time to time these additional amounts
will be transferred in cash by First Investors Life to its General Account.
Before making a transfer, First Investors Life will consider any possible
adverse impact that the transfer may have on Separate Account B.

First Investors Life reserves the right to invest the assets of Separate
Account B in the shares of other investment companies or any other investment
permitted by law. Such substitution would be made in accordance with the
provisions of the 1940 Act.

Your Choice of Investment Objective

When a Policy is purchased, the Policyowner decides to place the net annual
premium (premium less certain deductions) into at least one but not more than
five of the Subaccounts of Separate Account B to support the Policy's benefits,
provided the allocation to any one Subaccount is not less than 10% of the net
premium. The allocation is made on the Policy's issue date and at the beginning
of each Policy year thereafter. A portion of the allocated amount covers the
cost of insurance protection. Coverage under the Policy begins in accordance
with the terms of the Conditional Receipt or the issue date of the Policy in
accordance with the terms of the Policy. That Subaccount in turn invests in the
corresponding Fund of Life Series Fund, as set forth above. Twice a year, at any
time during the Policy year, the Policyowner may transfer all or part of the
cash value from one Subaccount to another provided the cash value is not
allocated to more than five of the Subaccounts, and provided the allocation to
any one Subaccount is not less than 10% of the cash value. The transfer becomes
effective on the date of receipt of the transfer request. Each Subaccount
corresponds to a Fund of Life Series Fund. The investment objectives of each
Fund of Life Series Fund which are offered to Policyowners of Separate Account B
are set forth below. See "Life Series Fund." There is no assurance that the
investment objective of any Fund of Life Series Fund will be realized. Because
each Fund of Life Series Fund is intended to serve a different investment
objective, each is subject to varying degrees of financial and market risks.
When deciding which Subaccount to utilize, a Policyowner should consider that
the Policy's investment return will affect the death benefit, the cash value and
the loan value of the Policy.

<PAGE>

As an example, using the policies illustrated on pages 19 through 21, First
Investors Life would allocate to the selected Subaccount(s) the following
amounts for each Policy year:

<TABLE>
<CAPTION>
Male Issue Male Issue Male Issue
Age 10 Age 25 Age 40
Beginning $600 Annual $1,200 Annual $1,800 Annual
of Policy Premium For Premium For Premium For
Year Standard Risk Standard Risk Standard Risk
- --------- ------------- ------------- -------------
<S> <C> <C> <C>
1st............................... $170.81 $ 508.46 $ 927.23
2nd-4th........................... 489.00 1,008.00 1,527.00
5th and later..................... 513.00 1,056.00 1,599.00
</TABLE>

Life Series Fund

First Investors Life Series Fund is a diversified open-end management
investment company registered under the 1940 Act. Life Series Fund consists of
eleven separate Funds, nine of which are offered to Policyowners of Separate
Account B. Target Maturity 2007 Fund and Target Maturity 2010 Fund, separate
Funds of Life Series Fund, are not offered to Policyowners of Separate Account
B. The shares of the Funds are not sold directly to the general public but are
available only through the purchase of an annuity contract or a variable life
insurance policy issued by First Investors Life.

The nine Funds of Life Series Fund offered to Policyowners may be referred to
as: First Investors Life Blue Chip Fund, First Investors Life Cash Management
Fund, First Investors Life Discovery Fund, First Investors Life Government Fund,
First Investors Life Growth Fund, First Investors Life High Yield Fund, First
Investors Life International Securities Fund, First Investors Life Investment
Grade Fund and First Investors Life Utilities Income Fund.

The investment objectives of each Fund of Life Series Fund which are offered
to Policyowners of Separate Account B are as follows:

Blue Chip Fund. The investment objective of Blue Chip Fund is to seek high
total investment return consistent with the preservation of capital. This goal
will be sought by investing, under normal market conditions, primarily in equity
securities of larger, well-capitalized companies with high potential earnings
growth that have shown a history of dividend payments, commonly known as "Blue
Chip" companies.

Cash Management Fund. The objective of Cash Management Fund is to seek to
earn a high rate of current income consistent with the preservation of capital
and maintenance of liquidity. The Cash Management Fund will invest in money
market obligations, including high quality securities issued or guaranteed by
the U.S. Government or its agencies and instrumentalities, bank obligations and
high grade corporate instruments. An investment in the Fund is neither insured
nor guaranteed by the U.S. Government. There can be no assurance that the Fund
will be able to maintain a stable net asset value of $1.00 per share.

Discovery Fund. The investment objective of Discovery Fund is to seek
long-term capital appreciation, without regard to dividend or interest income,
through investment in the common stock of companies with small to medium market
capitalization that the Adviser considers to be undervalued or less well known
in the current marketplace and to have the potential for capital growth.

Government Fund. The investment objective of Government Fund is to seek to
achieve a significant level of current income which is consistent with security
and liquidity of principal by

<PAGE>

investing, under normal market conditions, primarily in obligations issued or
guaranteed as to principal and interest by the U.S. Government, its agencies or
instrumentalities ("U.S. Government Obligations"), including mortgage-backed
securities.

Growth Fund. The investment objective of Growth Fund is to seek long-term
capital appreciation. This goal will be sought by investing, under normal market
conditions, primarily in common stocks of companies and industries selected for
their growth potential.

High Yield Fund. The primary objective of the High Yield Fund is to seek to
earn a high level of current income. Consistent with that objective, the Fund
will also seek growth of capital as a secondary objective. The High Yield Fund
seeks to attain its objectives primarily through investments in lower-grade,
high-yielding, high risk debt securities. Investments in high yield, high risk
securities, commonly referred to as "junk bonds," may entail risks that are
different or more pronounced than those involved in higher-rated securities. See
"High Yield Securities--Risk Factors" in Life Series Fund's Prospectus.

International Securities Fund. The primary objective of International
Securities Fund is to seek long-term capital growth. As a secondary objective,
the Fund seeks to earn a reasonable level of current income. These objectives
are sought, under normal market conditions, through investment in common stocks,
rights and warrants, preferred stocks, bonds and other debt obligations issued
by companies or governments of any nation, subject to certain restrictions with
respect to concentration and diversification.

Investment Grade Fund. The investment objective of the Investment Grade Fund
is to seek a maximum level of income consistent with investment in investment
grade debt securities.

Utilities Income Fund. The primary objective of the Utilities Income Fund is
to seek high current income. Long-term capital appreciation is a secondary
objective. These objectives are sought, under normal market conditions, through
investment in equity and debt securities issued by companies primarily engaged
in the public utilities industry.

No offer will be made of a Policy funded by the underlying Fund unless a
current Life Series Fund Prospectus has been delivered. Each Fund of the Life
Series Fund may be referred to as "Fund" or "Series" in the underlying Policies.

For more complete information about each of the Funds underlying Separate
Account B, including management fees and other expenses, see Life Series Fund's
Prospectus. The Prospectus details each Fund's investment goals, management
strategies, investment restrictions, portfolio turnover, and the inherent market
and financial risks of an investment in the Fund's shares. It is important to
read the Prospectus carefully before you decide to invest. Additional copies of
Life Series Fund's Prospectus, which is attached hereto, may be obtained by
writing to First Investors Life Insurance Company, 95 Wall Street, New York, New
York 10005 or by calling (212) 858-8200. There can be no assurance that any of
the objectives of the Funds will be achieved.

Changes in Fund Investment Policies and Restrictions

The investment policies and restrictions of the Funds are set forth above and
within Life Series Fund's Prospectus. Fundamental policies of a Fund may not be
changed without the approval of a majority vote of Policyowners investing in the
Subaccount which invests in that Fund in accordance with the 1940 Act (see
"Voting Rights"). Changes in such investment policies may be made without such
approval when required by state insurance regulatory authorities. The investment
policies may

<PAGE>

not be changed if such change is disapproved by First Investors Life although
any such disapproval may not be unreasonable. Such a change would be disapproved
only if it violated state law or was prohibited by state regulatory authorities
or if First Investors Life determined that the change would have an adverse
effect on its general account because it would result in unsound or overly
speculative investments. If First Investors Life disapproves a change, a summary
of the change and the reasons for disapproval will be set forth in the Proxy
Statement for Life Series Fund's next Special Meeting of Shareholders.

Adviser

First Investors Management Company, Inc., 95 Wall Street, New York, NY 10005,
a New York corporation, supervises and manages each Fund's investments,
supervises all aspects of each Fund's operations and, except for International
Securities Fund and Growth Fund, determines each Fund's portfolio transactions.
The Adviser serves as such under an advisory agreement dated June 13, 1994,
which was approved, with respect to each Fund, by Life Series Fund's Board of
Trustees and by the shareholders of each Fund. See Life Series Fund's Prospectus
for the amount of advisory fees paid by each Fund for the fiscal year ended
December 31, 1995.

Subadviser

Wellington Management Company, 75 State Street, Boston, MA 02109 ("WMC" or
"Subadviser"), has been retained by the Adviser and Life Series Fund on behalf
of International Securities Fund and Growth Fund as each of those Fund's
investment subadviser. The Subadviser serves as such under a subadvisory
agreement dated June 13, 1994 which was approved by Life Series Fund's Board of
Trustees and by the shareholders of the International Securities Fund and Growth
Fund. The Adviser has delegated discretionary trading authority to WMC with
respect to all the assets of International Securities Fund and Growth Fund,
subject to the continuing oversight and supervision of the Adviser and the Board
of Trustees. As compensation for its services, WMC is paid by the Adviser, and
not by either Fund, a fee which is computed daily and paid monthly.

Underwriter

First Investors Life and Separate Account B have entered into an Underwriting
Agreement with their affiliate, FIC, 95 Wall Street, New York, New York 10005.
For the fiscal years ended December 31, 1993, 1994 and 1995, FIC received fees
of $3,417,097, $4,048,086 and $4,963,368, respectively, in connection with the
distribution of Policies in a continuous offering. First Investors Life has
reserved the right in the Underwriting Agreement to sell the Policies directly.
The Policies are sold by insurance agents licensed to sell variable life
insurance policies, who are registered representatives of the Underwriter or
broker-dealers who have sales agreements with the Underwriter.

CHARGES AND EXPENSES

First Investors Life guarantees that it will not increase the amount of
premiums, charges deducted from premiums and the charges to the Subaccount(s)
for mortality and expense risks.

Charges Deducted from Premiums

AMOUNT ALLOCATED TO SELECTED SUBACCOUNT. The amount allocated to the selected
Subaccount(s) for a standard mortality risk Policy is the annual premium you pay
less the premiums for any optional insurance benefits and less the charges
listed below, which are allocated to First Investors Life's General Account.

<PAGE>

ANNUAL CHARGE. A $30 charge, which will be made in each Policy year, is for
annual administrative expenses, including premium billing and collection,
recordkeeping, processing death benefit claims, cash surrenders and Policy
changes, reporting and other communications to Policyowners. This charge has
been set at a level that will recover no more than the actual costs associated
with administering the Policy.

ADDITIONAL FIRST YEAR ADMINISTRATIVE CHARGE. A charge in the first Policy
year at the rate of $5 per $1,000 of initial face amount of insurance or a pro
rata portion thereof, is made to cover administrative expenses in connection
with the issuance of the Policy. Such expenses include medical examinations,
insurance underwriting costs, and costs incurred in processing applications and
establishing permanent Policy records. This charge has been set at a level that
will recover no more than the actual costs associated with administering the
Policy.

SALES LOAD. A charge, which is deemed to be a "sales load" as defined in the
1940 Act, not to exceed the following percentages of the annual premium, will be
charged as follows:

Years Maximum Percentages
----- -------------------
1............................................. 30%
2-4............................................ 10%
5 and thereafter...................................... 6%

The amount of the "sales load" in any Policy year is not specifically related
to sales expenses for that year. First Investors Life expects to recover its
distribution costs solely from sales charges over the life of the Policy.

STATE PREMIUM TAX CHARGE. This charge is 2% of the annual premium. Premium
taxes vary from state to state and the 2% rate is the average rate expected to
be paid on premiums received in all states over the lifetime of the Insured
covered by the Policy.

RISK CHARGE. This is a maximum 1.5% charge of the annual premium, to cover
the contingency that the Insured would die at a time when the guaranteed minimum
death benefit exceeds the death benefit which would have been payable in the
absence of the guaranteed minimum death benefit.

OTHER CHARGES. The extra premium charged for sub-standard life insurance risk
and the charge for premiums not paid on an annual basis is deducted from the
gross premium upon receipt.

Deductions and the accrual for the above charges begin on a Policy's issue
date. For the fiscal year ended December 31, 1995, First Investors Life received
$4,265,000 in sales charges and $3,464,000 in administrative fees.

Expenses Charged to Separate Account B

CHARGE FOR MORTALITY AND EXPENSE RISKS. First Investors Life makes a daily
charge to each Subaccount for mortality and expense risks assumed by First
Investors Life. The charge is computed at an effective annual rate of .50% of
the value of the Subaccount's assets attributable to the Policies.

The mortality risk assumed is that the Insured may live for a shorter period
of time than estimated and, therefore, a greater amount of death benefits than
expected will be payable in relation to the amount of the premiums received. The
expense risk assumed is that expenses incurred in issuing and administering the
Policies will be greater than estimated. First Investors Life

<PAGE>

will realize a gain from this charge to the extent it is not needed to provide
for benefits and expenses under the Policies.

COST OF INSURANCE. After the net annual premium is placed into Separate
Account B, a charge is made for the cost of insurance protection (see "Cost of
Insurance Protection").

CHARGES FOR INCOME TAXES. First Investors Life currently does not charge
Separate Account B for its corporate Federal income taxes that may be
attributable to Separate Account B. However, First Investors Life may make such
a charge in the future. Charges for other applicable taxes attributable to
Separate Account B may also be made (see "Charges for First Investors Life's
Income Taxes").

Expenses Charged to the Fund

BROKERAGE CHARGES. The Funds bear the cost of brokerage commissions, transfer
taxes and other fees related to securities transactions. See Life Series Fund's
Statement of Additional Information for the amount of brokerage commissions paid
by the Funds for the fiscal year ended December 31, 1995, all of which were paid
to unaffiliated dealers.

OTHER CHARGES. Each Subaccount purchases shares of the corresponding Fund at
net asset value. The net asset value of those shares reflects management fees
and expenses already deducted from the assets of the Fund. Those fees and
expenses are described in detail in Life Series Fund's Prospectus.

THE VARIABLE LIFE POLICY

General

The following discussion summarizes important provisions of the Policy
offered by this Prospectus. Appendix I to this Prospectus contains summaries of
other provisions. These discussions assume that premiums have been duly paid and
there have been no Policy loans. The death benefit and cash value are affected
if premiums are not duly paid or if a Policy loan is made. For information about
a default in premium payment, see "Premiums-Default and Options on Lapse." For
loan information, see "Loan Provisions." Policy years and anniversaries will be
measured from the Date of Issue, and each Policy year will commence on the
anniversary of the Date of Issue.

Death Benefit

The death benefit is the amount paid to the beneficiary at the death of the
Insured. It will be the sum of the Guaranteed Insurance Amount (face amount of
the Policy) plus, if positive, the variable insurance amount for each selected
Subaccount as described below. The benefit will be increased to reflect any
insurance on the life of the Insured added by rider and any premium paid which
applies to a period of time beyond the Policy month in which the Insured dies.
It will be reduced by any Policy loan and loan interest and any unpaid premium
which applies to a period prior to and including the Policy month in which the
Insured dies.

Generally, payment is made within seven days after all claim requirements are
received by First Investors Life at its Home Office. Interest is paid on death
proceeds from the date of death until payment is made at the annual rate First
Investors Life is paying under the payment option when proceeds are left on
deposit with First Investors Life, or at a higher rate if required by law.

<PAGE>

THE GUARANTEED MINIMUM. The death benefit is guaranteed never to be less than
the Policy's face amount. The Policy's face amount is constant throughout the
life of the Policy. During the first Policy year, the death benefit is equal to
the Guaranteed Insurance Amount. Thereafter, the death benefit is determined on
each Policy anniversary, and it remains level during the following Policy year.
The death benefit payable, therefore, depends on the Policy year in which the
Insured dies.

THE VARIABLE INSURANCE AMOUNT. The death benefit is made up of two parts: the
Guaranteed Insurance Amount and, if positive, the variable insurance amount for
each selected Subaccount. The variable insurance amount reflects the investment
results of the selected Subaccount(s). During the first Policy year, the death
benefit is the Guaranteed Insurance Amount because the variable insurance amount
is zero. On the first Policy anniversary, and on each anniversary thereafter,
the investment results for the preceding Policy year are ascertained. If the net
investment return on the Policy's benefit base ("Net Investment Return") for
each selected Subaccount is 4%, then the variable insurance amount does not
change. The "benefit base" is the amount at work earning a return under a
Policy.

If the Net Investment Return for each selected Subaccount for the preceding
Policy year is greater than 4%, the variable insurance amount increases. If the
Net Investment Return is less than 4%, the variable insurance amount decreases
(but the death benefit never goes below the Guaranteed Insurance Amount). The
variable insurance amount is set on each Policy anniversary and remains at that
amount until the next Policy anniversary. The percentage change in the death
benefit is not the same as the Net Investment Return.

We call the amount by which the Net Investment Return is more or less than 4%
the "investment return". The change in the variable insurance amount on a Policy
anniversary equals the amount of insurance purchased under a Policy or the
amount of insurance coverage cancelled under a Policy which results from
positive or negative investment return, respectively. To calculate the change in
the variable insurance amount, First Investors Life uses a net single premium
per $1 of paid-up whole life insurance based on the Insured's age at the
anniversary. Thus, if the investment return for a male age 25 is $100, positive
or negative, the variable insurance amount will increase or decrease by $542
(see net single premium amounts on next page).

For example, using the policy illustration for a male issue age 25 on Page
20, and assuming the 8% hypothetical gross annual investment return (equivalent
to a Net Investment Return of approximately 6.55%), the change in the variable
insurance amount on the 6th Policy anniversary and the change on the 12th Policy
anniversary are calculated as follows:

<PAGE>

<TABLE>
<CAPTION>
Calculation of Change in
Variable Insurance Adjustment
Amount at End of Policy Year
-------------------------------
6 12
--------- ----------
<S> <C> <C>
(1) Cash Value End of Prior Year......................... $4,972.00 $14,529.00
(2) Net Premium.......................................... 1,056.00 1,056.00
(3) Benefit Base Beginning of
Current Policy Year: (1)+(2)......................... 6,028.00 15,585.00
(4) Actual Net Investment Return
(.064399) less the Base
Rate of Return which is
the Assumed Rate (.04)............................... .024399 .024399
(5) Investment Return (3)x(4)............................ 147.08 380.25
(6) Net Single Premium at
End of Current Year.................................. 0.22416 0.27338
(7) Change in Variable Adjustment
Amounts (5) divided by (6)........................... $ 656.14 $ 1,390.92
</TABLE>

Figures are rounded.

It should be noted that, as shown in the table below, the net single premium
increases as the Insured advances in age and thus larger dollar amounts of
investment return are required each year to result in the same increases or
decreases in the variable insurance amount.

Net Single Premium. A Policy includes a table of net single premiums used to
convert the investment return for a Policy into increases or decreases in the
variable insurance amount. This purchase basis does not depend upon the risk
classification of a Policy or any changes in the Insured's health after issue of
a Policy. The net single premium will be lower for a Policy issued to a female
than for a Policy issued to a male, as shown below.

Variable Insurance
Adjustment Amount
Net Single Premium Purchased or Cancelled
Male Per $1.00 of Variable by $1.00 of
Attained Age Insurance Amount Investment Return
------------ ---------------- -----------------
5 $.09884 $10.12
15 .13693 7.30
25 .18452 5.42
35 .25593 3.91
45 .35291 2.83
55 .47352 2.11
65 .60986 1.64

Variable Insurance
Adjustment Amount
Net Single Premium Purchased or Cancelled
Female Per $1.00 of Variable by $1.00 of
Attained Age Insurance Amount Investment Return
------------ ---------------- -----------------
5 $.08195 $12.20
15 .11326 8.83
25 .15684 6.38
35 .21872 4.57
45 .30185 3.31
55 .40746 2.45
65 .54017 1.85

The variable insurance amount is cumulative and reflects the accumulation of
increases and decreases from past Policy years. The amount may be positive or
may be negative, depending on the

<PAGE>

investment performance of the designated Subaccount(s) during the time the
Policy is in force. If, at the time of the Insured's death, the variable
insurance amount is negative, then the insurance benefit is the Guaranteed
Insurance Amount. Good investment performance must first offset any negative
variable insurance amount before there can be a positive amount.

An example of the death benefit using the policy illustration for a male
issue age 25 on Page 20, and assuming the 8% hypothetical gross annual
investment return (equivalent to a Net Investment Return of approximately
6.55%), the death benefit shown for the end of Policy year 5 would increase to
the amount shown for the end of Policy year 6 for the Policy, as follows:

<TABLE>
<CAPTION>
Guaranteed
Insurance Variable
Variable Life Amount + Insurance = Death
Policy Minimum Amount Benefit
------ ------- ------ -------
<S> <C> <C> <C>
End of Policy Year 5.......... $51,908 $1,489 $53,398
Increase...................... -- 657 657 (1.2% Increase)
End of Policy Year 6.......... $51,908 $2,146 $54,055
</TABLE>

If, instead, the gross annual investment return in the year illustrated had
been 0% (equivalent to a Net Investment Return of approximately -1.45%), the
death benefit would have decreased by $1,464 (a 2.7% decrease), and the death
benefit for the end of Policy year 6 would have been $51,934.

At a given Net Investment Return rate, the dollar amount of an increase or
decrease in the variable insurance amount is greater when assets in the
Subaccount(s) supporting the death benefit under a Policy are greater.
Therefore, the change in the variable insurance amount (which affects the change
in the death benefit) is expected to be greater in the later Policy years when
those assets are expected to be higher in relation to the death benefit, than in
the early Policy years when those assets are relatively low.

For example, as shown in the example above for a male issue age 25 assuming
the 8% hypothetical gross annual investment return (equivalent to a Net
Investment Return of approximately 6.55%), the death benefit for the end of
Policy year 6 is 1.2% higher than the death benefit for the end of Policy year
5. The death benefit for that Policy at the end of Policy year 12, assuming the
8% hypothetical gross annual investment return, would be 2.4% higher than the
death benefit for the end of Policy year 11 (not shown on Page 20), as follows:

<TABLE>
<CAPTION>
Guaranteed
Insurance Variable
Variable Life Amount + Insurance = Death
Policy Minimum Amount Benefit
------ ------- ------ -------
<S> <C> <C> <C>
End of Policy Year 11......... $51,908 $7,258 $59,166
Increase...................... -- 1,391 1,391 (2.4% Increase)
End of Policy Year 12......... $51,908 $8,649 $60,557
</TABLE>

Where a Policy's death benefit for a Policy year (after the first Policy
year) was equal to the Guaranteed Insurance Amount because the variable
insurance amount was negative, the death benefit would increase above the
Guaranteed Insurance Amount on a Policy anniversary only if the Net Investment
Return for the preceding Policy year was sufficiently greater than 4% to result
in a positive variable insurance amount and, accordingly, a death benefit above
the Guaranteed Insurance Amount. For example, assume the Policy for a male issue
age 25 illustrated on Page 20 had a 0% hypothetical gross annual investment
return for the first five policy years (which results in a negative variable
insurance amount). In order for there to be an increase in the death benefit

<PAGE>

above the Guaranteed Insurance Amount for Policy year 7 (the amount shown for
the end of Policy year 6), the Net Investment Return for Policy year 6 would
have to be at least 17.5%.

NET INVESTMENT RETURN. On each Policy anniversary, the Net Investment Return
of the designated Subaccount(s) is computed separately for each Policy. The Net
Investment Return reflects the investment performance of each selected
Subaccount from the first day of the Policy year until the last day of the
Policy year. It reflects each Subaccount's:

Investment income (net of Series expenses);
Plus realized and unrealized capital gains;
Minus realized and unrealized capital losses;
Minus charges, if any, for taxes;
Minus a charge not exceeding .50% per year for mortality and expense risks.

The method of calculating the Net Investment Return is detailed in the
Policy. The Net Investment Return for a Policy year is not the same as the Net
Investment Return for the Subaccount(s) for a calendar year unless a Policy's
anniversary is the last day of the calendar year.

VALUATION OF ASSETS. For purposes of computing the Net Investment Return, the
value of the assets of each Subaccount are determined as of the close of
business on each business day.

First Investors Life daily calculates the asset valuation of each Subaccount.
The net asset value of a Fund's share is determined by the Fund in the manner
set forth in Life Series Fund's prospectus.

Cash Value

AMOUNT OF CASH VALUE. The cash value of the Policy on any date is the sum of
the cash value you have in each Subaccount in which you have invested. The
amounts of the cash value you have in each Subaccount will vary daily depending
on investment experience. The cash value of each Subaccount at the end of each
Policy year is the amount of the tabular cash value attributable to the
Subaccount(s) on that date plus or minus the net single premium for the current
variable insurance amount attributable to the Subaccount(s) on that date. If the
date is other than the Policy anniversary date, the cash value will be increased
or decreased depending on the investment results of the Subaccount(s) selected
for the time elapsed since the last Policy anniversary. This assumes that no
premium is due and unpaid. In calculating the cash value, adjustments are made
for the net premium, the investment results and the cost of insurance
protection. (See below for an explanation of the Cost of Insurance Protection.)

For example, using the Policy illustration for a male issue age 25 on Page
20, and assuming the 8% hypothetical gross annual investment return (equivalent
to a Net Investment Return of approximately 6.55%), the cash value shown for the
end of Policy year 5 would increase to the amount shown for the end of Policy
year 6 for the Policy as follows:

(1) Cash Value End of Prior Year.............................. $4,972
(2) Net Premium............................................... 1,056
(3) Benefit Base Beginning of Current Policy Year 6: (1)+(2).. 6,028
(4) Actual Rate of Return..................................... .064399
(5) Actual Investment Return (3)x(4).......................... 388
(6) Benefit Base End of Policy Year 6: (3)+(5)................ 6,416
(7) Cost of Insurance During Policy Year 6.................... 84
(8) Cash Value End of Policy Year 6: (6)-(7).................. 6,332

<PAGE>

The cash value is not guaranteed. The Policy offers the possibility of cash
value appreciation resulting from good investment performance, although there is
no assurance that such appreciation will occur. It is also possible, due to poor
investment performance, for the cash value to decline to the point of having no
value or, in fact, a negative value. Subsequent net premium payments and
investment returns would be credited against the negative cash value. The
Policyowner bears all the investment risk as to the amount of the cash value. It
is unlikely that the Policy will have any cash value until the later months of
the first Policy year (see "Additional First Year Administrative Charge"). The
cash value stated in the illustrations on Pages 19 to 21 and Pages 30 to 32 are
at the end of the Policy years shown, assuming the various hypothetical
investment returns, the cash value as of the end of the preceding Policy year,
adjusted to reflect the Net Investment Return of each Subaccount in which you
have invested, the cost of the insurance protection and premiums paid since the
Policy's last anniversary.

TRANSFER RIGHTS. Twice a year, at any time during the Policy year, you may
transfer part or all of your cash value from the Subaccounts you are in to any
other Subaccounts provided the cash value is not allocated to more than five of
the Subaccounts.

SURRENDER FOR CASH VALUE. The Policyowner may surrender the Policy for its
cash value at any time while the Insured is living. The amount payable will be
the cash value next computed after the request is received at the Home Office of
First Investors Life. Surrender will be effective on the date First Investors
Life has received both the Policy and a written request in a form acceptable to
First Investors Life. First Investors Life will usually pay the surrender value
within 7 days, but payment may be delayed if a recent payment by check has not
yet cleared the bank, when First Investors Life is not able to determine the
amount because the New York Stock Exchange is closed for trading or the
Securities and Exchange Commission ("Commission") determines that a state of
emergency exists or for such other periods as the Commission may by order permit
for the protection of security holders. Interest will be paid if payment of the
surrender value is delayed beyond 7 days. In addition, under federal tax laws
withholding taxes may be deducted from the surrender value.

Cost of Insurance Protection

First Investors Life issues variable life insurance policies to individuals
with standard mortality risks and to individuals with higher mortality risks, as
permitted by First Investors Life's underwriting rules. A higher gross premium
is charged for the person with the higher mortality risk. Given the same age,
sex and insurance face amount, the net annual premium going into the
Subaccount(s) is the same for the standard risk and the higher risk person.
Also, the cost of insurance deducted from the Subaccount(s) (item 7 in the
example above) would be the same for each such individual. First Investors Life
uses the 1980 Commissioners' Standard Ordinary Mortality Table to actuarially
compute the cost of insurance for each Policy, except mortality rates for
extended term insurance are from the Commissioners' 1980 Extended Term Table.
The cost is based on the net amount of insurance at risk (the Policy's face
amount plus the variable insurance amount less the cash value) and the person's
sex and attained age. The amount that is deducted each year is different because
as the person's age increases the probability of death generally increases. The
net amount of insurance at risk may decrease or increase each year depending on
investment experience of the selected Subaccount(s).

<PAGE>

Loan Provision

LOAN PRIVILEGE. The Policyowner may borrow up to 75% of the cash value during
the first three Policy years or 90% of the cash value after the first three
Policy years upon assignment to First Investors Life of the Policy as sole
security. Interest will be charged daily at an effective annual rate of 6%
compounded on each Policy anniversary. In general, the loan amount is sent
within seven days of receipt of the request. Except when used to pay premiums, a
new loan will not be permitted unless it is at least $100. The Policyowner may
repay all or a portion of any loan and accrued interest while the Insured is
living and the Policy is in force.

EFFECT OF LOAN. A loan does not affect the amount of the premiums due. When a
loan is taken out, a portion of the cash value equal to the loan is transferred
from the Subaccount(s) to First Investors Life's General Account. Loans will be
charged to each Subaccount in proportion to the investment in each Subaccount as
of the date of the Policy loan. The amount maintained in the General Account
will not be credited with the Net Investment Return earned by Subaccount(s)
during the period the loan is outstanding. Instead, it grows at the assumed
interest rate of 4%, in accordance with the tabular cash value calculations as
filed with the state insurance departments. Therefore, a Policy's death benefit
above the Guaranteed Insurance Amount and a Policy's cash value are permanently
affected by any loan whether or not repaid in whole or in part.

Recall that the death benefit is made up of two parts: the Guaranteed
Insurance Amount and, if positive, the variable insurance amount (see "The
Guaranteed Minimum" and "The Variable Insurance Amount"). The cash value, the
variable insurance amount and the death benefit in excess of the Guaranteed
Insurance Minimum, if any, are dependent upon the Net Investment Return of the
Subaccount(s). During periods of favorable investment return (a net rate of
return greater than 4%), an outstanding Policy loan will result in lower Policy
values than would have otherwise resulted in the absence of any indebtedness.

For example, use the Policy for a male issue age 25 illustrated on Page 20,
and assume the 8% gross annual investment return and that a $3,000 loan was made
at the end of Policy year 9. For the end of Policy year 10, the death benefit
and cash value would be $57,612 and $12,612, respectively. (The outstanding
indebtedness would be deducted from these amounts upon death or surrender.) The
differences between these amounts and the $57,898 death benefit and $12,685 cash
value shown on Page 20 for Policy year 10 result because the portion of the cash
value equal to the indebtedness which is transferred from the Subaccount(s) does
not reflect the Subaccount(s) Net Investment Return of approximately 6.55%.

However, outstanding indebtedness will diminish the adverse effect on Policy
values during a period of unfavorable investment return (a net rate of return
less than 4%) because the portion of the cash value transferred from the
Subaccount(s) to the General Account will grow at the assumed rate of 4%. Thus,
a Policy loan can protect the cash value from decreasing if the Net Investment
Return is less than 4%.

Interest will be charged daily at an effective annual rate of 6% compounded
on each Policy anniversary. Interest is payable at the end of each Policy year
and on the date the loan is repaid. If interest is not paid when due, the loan
will be increased by that amount and an equivalent amount of cash value will be
transferred from the Subaccount(s) to the General Account. Loan repayments will
be credited to each Subaccount in proportion to the investment in each
Subaccount as of the date of repayment.

<PAGE>

The amount of any outstanding loan plus interest is subtracted from the death
benefit or the cash value on payment. Whenever the then outstanding loan with
accrued interest equals or exceeds the cash value, the Policy terminates 31 days
after notice has been mailed by First Investors Life to the Policyowner and any
assignee of record at their last known addresses, unless a repayment is made
within that period.
Premiums

ALLOCATION OF PREMIUM. At the time of application, the Policyowner decides to
place his or her net annual premium (see "Charges Deducted from Premiums") into
any one or more of the Subaccounts. The death benefit and cash value may
increase or decrease depending on the investment performance of the chosen
Subaccount(s).

PAYMENT PERIODS AND FREQUENCY. Premiums are payable annually or may be paid
more frequently as elected by the Policyowner. Payments are due on or before the
due dates as specified in the Policy at the Home Office of First Investors Life.
Premium payments received before they are due will be placed in First Investors
Life's General Account. On the day the premium payment is due, the premium will
be credited to the Subaccount(s) selected by the Policyowner. Premiums for the
Policy are payable for twelve years. A refund will be made of premiums paid
which are applicable to any period which extends beyond the end of the month in
which the Insured's death occurs.

LEVEL PREMIUMS. The level premiums act as an averaging device to cover
expenses, which are highest in the early Policy years, and the cost of the
mortality risk, which increases with age. Thus, in the early Policy years,
premiums are higher than needed to pay death claims, while in the later years
premiums are less than required to meet the death claims. Accordingly, the
assets allocated to the Subaccount(s) in the early Policy years are used in part
to support the expected death claims in those years, with the balance
accumulated as a reserve to help meet the death claims in the later Policy
years. Also, assets are allocated to First Investors Life's General Account to
accumulate as a reserve to cover the contingency that the Insured will die at a
time when the guaranteed minimum death benefit exceeds the death benefit which
would have been payable in the absence of such guarantee. In setting its premium
rates, First Investors Life took into consideration actuarial estimates of death
and surrender benefits, lapses, expenses, investment experience and an amount to
be contributed to First Investors Life's surplus.

PREMIUM RATES. When payments are made on other than an annual basis, the
aggregate premium amounts for a Policy year are higher, reflecting charges for
loss of interest and additional billing and collection expenses. The additional
charge is deducted from these premiums when they are received.

Premiums on Installment Basis
(as a percentage of an annual premium)

Aggregate Premiums
Frequency Each Premium For Policy Year
--------- ------------ ---------------
Annual.......................... 100.00% 100.00%
Semiannual...................... 51.00 102.00
Quarterly....................... 26.00 104.00
Pre-authorized Monthly.......... 8.83 105.96

Under a pre-authorized monthly plan, premiums are automatically paid by
charges made against the Policyowner's bank account.

<PAGE>

AUTOMATIC PREMIUM LOAN PROVISION. Any premium not paid before the end of the
grace period (described below) will be paid by charging the premium as a Policy
loan against the Policy provided the Automatic Premium Loan provision has been
elected in the application for the Policy or is elected in writing and received
by First Investors Life at its Home Office while no premium is in default;
provided, the resulting Policy loan and loan interest to the next premium due
date do not exceed the loan value.

The Automatic Premium Loan Provision may be revoked at any time by written
request from the Policyowner received by First Investors Life at its Home
Office.

DEFAULT AND OPTIONS ON LAPSE. A premium not paid on or before its due date is
in default, but the Policy provides for a 31-day grace period for the payment of
each premium after the due date. The insurance continues in force during the
grace period, but, if the Insured dies during the grace period, the portion of
the premium due which is applicable to the period from the premium due date to
the end of the Policy month in which death occurs is deducted from the death
benefit.

Within 60 days after the date of default, if a Policy is not surrendered, the
cash value less any loans and interest may be applied to purchase continued
insurance. The options are for reduced paid-up whole life insurance or extended
term insurance. Under the Policy, the extended term insurance option would be
the automatic option if no other election was selected. However, that option is
available only in standard risk cases. If the Policy was rated for extra
mortality risks, the paid-up insurance will be the automatic option. Both
options are for fixed life insurance and neither option requires the further
payment of premiums.

The reduced paid-up whole life insurance option provides a fixed and level
amount of paid-up whole life insurance. The amount of coverage will be that
which the surrender value on the date the option becomes effective will
purchase. The extended term insurance option provides a fixed and level amount
of term insurance equal to the death benefit (less any indebtedness) as of the
date the option became effective. The insurance coverage under this option will
continue for as long a period as the surrender value on such date will purchase.

For example, use the Policy for a male issue age 25 illustrated on Page 20
and assume the 0% and 8% hypothetical gross annual investment returns. If an
option became effective at the end of Policy year 5, the fixed insurance
coverage under these Policies would be as follows:

0% 8%
-------- -----
Cash Value...................... $ 3,992 $ 4,972
Reduced Paid-up Insurance....... 18,406 22,925
for life for life
Extended Term Insurance......... 51,908 53,398
for 25 years for 28 years

A Policy continued under either option may be surrendered for its cash value
while the Insured is living. Loans are available under the reduced paid-up whole
life insurance option, but not under the extended term insurance option.

REINSTATEMENT. A Policy not surrendered for its cash value may be reinstated
within five years from the date of default in accordance with the Policy. To
reinstate, the Policyowner must present evidence of insurability acceptable to
First Investors Life and must pay to First Investors Life the greater of (a) (i)
all premiums from the date of default with interest to the date of reinstatement
plus (ii) any Policy debt (plus interest to the date of reinstatement) in effect
when the Policy was continued as paid up insurance or extended term insurance;
or (b) 110% of the increase

<PAGE>

in cash value resulting from reinstatement. Any Policy debt that arose after the
Policy was continued as paid up insurance and in effect immediately before
reinstatement is then added to the greater of (a) or (b) to comprise the payment
required. Interest is calculated at the rate of 6% per year compounded annually.
Cancellation Rights

The Policyowner has a limited right to cancel and return the Policy to First
Investors Life. The Policyowner may examine the Policy and at any time within 10
days after receipt of the Policy or notice of right of withdrawal, or within 45
days after completion of Part I of the application for the Policy, whichever is
later, return it to First Investors Life or to the agent of First Investors Life
through whom it was purchased with a written request for cancellation and obtain
a full refund of the premiums paid.

Exchange Privilege

Provided premiums are duly paid, within twenty-four months after the issue
date shown in the Policy, the Policyowner may exchange the Policy for a
permanent fixed life insurance policy specified in the Policy on the Insured's
life. The Policyowner also may exchange the Policy for a fixed life insurance
policy if a Fund changes its investment adviser or has a material change in its
investment objectives or restrictions. Evidence of insurability is not required
to exercise this privilege. The new policy will have a level face amount equal
to the face amount of the Policy and the same benefit riders, issue dates and
risk classification for the Insured as the Policy. Premiums for the new policy
will be based on the premium rates for the new policy which were in effect on
the Policy date. The Policyowner may elect either a continuous-premium policy or
a limited-payment policy.

In some cases, there may be a cash adjustment on exchange. The adjustment
will be the Policy's surrender value minus the new policy's tabular cash value.
If the result is positive, First Investors Life must pay the owner; if the
result is negative, the owner must pay First Investors Life. First Investors
Life will determine the amount of a cash adjustment as of the date the Policy
and written request is received by First Investors Life at its Home Office.

If a Policy is not issued for any reason, an applicant shall only be refunded
the amount of the premium without interest.

The foregoing description of Policy provisions is qualified by reference to a
specimen of the Policy which has been filed as an exhibit to the Registration
Statement of Separate Account B. Settlement options, optional insurance benefits
and general provisions of the Policies are discussed under Appendix I.

ILLUSTRATIONS OF DEATH BENEFITS,
CASH VALUES AND ACCUMULATED PREMIUMS

The tables on Pages 19 to 21 illustrate the way in which the Policy operates.
They show how the death benefit and the cash value may vary over an extended
period of time assuming the Subaccount(s) experience hypothetical rates of
investment return (i.e., investment income and capital gains and losses,
realized or unrealized) equivalent to constant gross annual rates of 0%, 4% and
8%. The cash value on any day within a Policy year equals the cash value as of
the end of the preceding Policy year, adjusted to reflect the Subaccount(s) Net
Investment Return, the cost of the insurance protection and premiums paid since
the Policy's last anniversary. The tables are based on annual premiums of $600,
$1,200 and $1,800 to assist in a comparison of the death benefits and cash
values under the Policy with those under other variable life insurance policies
which may be issued by First

<PAGE>

Investors Life or other companies. The death benefit and cash value for the
Policy would be different from those shown if premiums are paid more frequently
than annually or if the actual rates of investment return applicable to the
Policy averaged 0%, 4% or 8% over a period of years, but nevertheless fluctuated
above or below that average for individual Policy years. Please refer to Pages
30 to 32 for additional illustrations of death benefits, cash values and
accumulated premiums which assume a hypothetical gross annual investment return
of 0%, 6% and 12%.

The constant gross annual rate of investment return of 0%, 4% and 8% is reduced
by the following:

1. A daily charge to the Subaccount(s) for mortality and expense risks
equivalent to an annual charge of .50% at the beginning of each year.

2. An investment advisory fee of 0.75% of each underlying Fund's average
daily net assets.

3. Assumed operating expenses of 0.20% of each underlying Fund's average
daily net assets.

Taking into account all of these charges, the gross annual rates of
investment return of 0%, 4%, and 8% correspond to net annual rates of
approximately -1.45%, 2.55% and 6.55%, respectively. The tables reflect that no
charge is currently made to the Subaccount(s) for First Investors Life's
corporate Federal income taxes. However, First Investors Life may make such
charges in the future which would require higher rates of investment return in
order to produce after-tax returns of 0%, 4% and 8% (see "Charges for First
Investors Life's Income Taxes").

The second column of each table shows the amount which would be accumulated
if the annual premium (gross amount) was invested to earn interest, after taxes,
at 5% compounded annually. For a further discussion of illustrations of death
benefits, cash values and accumulated premiums, see Appendix II.

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

First Investors Life will furnish upon request a comparable illustration
using the proposed Insured's age and the face amount or premium amount
requested, and assuming that premiums are paid on an annual basis and the
proposed Insured is a standard risk. In addition, a comparable illustration will
be included at the delivery of the Policy if a purchase is made, reflecting the
Insured's risk classification.

<PAGE>

<TABLE>
<CAPTION>
Male Issue Age 10
$600 Annual Premium for Standard Risk (1)
$39,638 Face Amount (Guaranteed Minimum Death Benefit)

Total Death Benefit (2) Cash Values (2)
End of Premiums Assuming Hypothetical Gross (After Assuming Hypothetical Gross (After
Policy Premium Paid Plus Tax) Annual Investment Return of Tax) Annual Investment Return of
Year Due Interest at 5% 0% 4% 8% 0% 4% 8%
- -------- --------- -------------- ----------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $600 $ 630 $39,638 $39,638 $ 39,673 $ 138 $ 145 $ 152
2 600 1,291 39,638 39,638 39,798 586 617 650
3 600 1,986 39,638 39,638 40,014 1,023 1,098 1,176
4 600 2,715 39,638 39,638 40,321 1,450 1,585 1,730
5 600 3,481 39,638 39,638 40,720 1,889 2,104 2,339
6 600 4,285 39,638 39,638 41,213 2,316 2,629 2,981
7 600 5,129 39,638 39,638 41,799 2,734 3,163 3,658
8 600 6,016 39,638 39,638 42,479 3,143 3,707 4,374
9 600 6,947 39,638 39,638 43,253 3,547 4,263 5,132
10 600 7,924 39,638 39,638 44,120 3,946 4,832 5,936

15 0 11,608 39,638 39,638 49,496 4,473 6,382 9,133

20 0 14,816 39,638 39,638 55,625 4,010 6,971 12,064

25 0 18,909 39,638 39,638 62,507 3,610 7,646 15,998

30 0 24,133 39,638 39,638 70,244 3,244 8,369 21,173

Attained
Age
65 0 81,723 39,638 39,638 126,226 1,685 11,721 76,980
</TABLE>

(1) Corresponds to $306.00 semiannually, $156.00 quarterly, or $52.98 monthly.

(2) Assumes no policy loan is made.

Hypothetical rates of interest are illustrative only and are not a
representation of past or future rates of return. They are after deduction of
tax charges but before any other expenses charged against Life Series Fund or
Separate Account B. Actual rates may be higher or lower than hypothetical rates.
No representation can be made by First Investors Life or Life Series Fund that
hypothetical rates can be achieved for any one year or sustained over any period
of time. See prospectus for details of the calculations.

<PAGE>

<TABLE>
<CAPTION>
Male Issue Age 25
$1,200 Annual Premium for Standard Risk (1)
$51,908 Face Amount (Guaranteed Minimum Death Benefit)

Total Death Benefit (2) Cash Values (2)
End of Premiums Assuming Hypothetical Gross (After Assuming Hypothetical Gross (After
Policy Premium Paid Plus Tax) Annual Investment Return of Tax) Annual Investment Return of
Year Due Interest at 5% 0% 4% 8% 0% 4% 8%
- -------- --------- -------------- ----------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $1,200 $ 1,260 $51,908 $51,908 $ 51,973 $ 409 $ 429 $ 449
2 1,200 2,583 51,908 51,908 52,154 1,308 1,385 1,462
3 1,200 3,972 51,908 51,908 52,451 2,197 2,366 2,543
4 1,200 5,431 51,908 51,908 52,864 3,076 3,375 3,695
5 1,200 6,962 51,908 51,908 53,398 3,992 4,459 4,972
6 1,200 8,570 51,908 51,908 54,054 4,897 5,572 6,332
7 1,200 10,259 51,908 51,908 54,832 5,791 6,713 7,778
8 1,200 12,032 51,908 51,908 55,732 6,673 7,882 9,315
9 1,200 13,893 51,908 51,908 56,754 7,544 9,080 10,949
10 1,200 15,848 51,908 51,908 57,898 8,404 10,308 12,685

15 0 23,217 51,908 51,908 64,950 9,524 13,635 19,577

20 0 29,631 51,908 51,908 72,999 8,504 14,836 25,762

25 0 37,818 51,908 51,908 82,058 7,539 16,033 33,680

30 0 48,266 51,908 51,908 92,259 6,628 17,185 43,687

Attained
Age
65 0 78,620 51,908 51,908 116,712 4,947 19,096 71,178
</TABLE>

(1) Corresponds to $612.00 semiannually, $312.00 quarterly, or $105.96 monthly.

(2) Assumes no policy loan is made.

<PAGE>

<TABLE>
<CAPTION>
Male Issue Age 40
$1,800 Annual Premium for Standard Risk (1)
$47,954 Face Amount (Guaranteed Minimum Death Benefit)

Total Death Benefit (2) Cash Values (2)
End of Premiums Assuming Hypothetical Gross (After Assuming Hypothetical Gross (After
Policy Premium Paid Plus Tax) Annual Investment Return of Tax) Annual Investment Return of
Year Due Interest at 5% 0% 4% 8% 0% 4% 8%
- -------- --------- -------------- ----------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $1,800 $ 1,890 $47,954 $47,954 $48,027 $ 762 $ 799 $ 835
2 1,800 3,874 47,954 47,954 48,206 2,097 2,225 2,355
3 1,800 5,958 47,954 47,954 48,492 3,406 3,678 3,964
4 1,800 8,146 47,954 47,954 48,883 4,689 5,161 5,667
5 1,800 10,443 47,954 47,954 49,386 6,020 6,747 7,549
6 1,800 12,856 47,954 47,954 49,999 7,328 8,367 9,543
7 1,800 15,388 47,954 47,954 50,724 8,615 10,023 11,656
8 1,800 18,048 47,954 47,954 51,560 9,884 11,717 13,898
9 1,800 20,840 47,954 47,954 52,509 11,137 13,450 16,276
10 1,800 23,772 47,954 47,954 53,571 12,375 15,225 18,798

15 0 34,825 47,954 47,954 60,126 13,764 19,765 28,471

20 0 44,447 47,954 47,954 67,618 11,963 20,956 36,545

25 0 56,727 47,954 47,954 76,062 10,274 21,963 46,387

30 0 72,399 47,954 47,954 85,589 8,695 22,699 58,095

Attained
Age
65 0 56,727 47,954 47,954 76,062 10,274 21,963 46,387
</TABLE>

(1) Corresponds to $918.00 semi annually; $468.00 quarterly, or $158.94
monthly.

(2) Assumes no policy loan is made.

<PAGE>

FEDERAL INCOME TAX STATUS

Policy Proceeds

The discussion herein is general in nature and not intended as tax advice. It
is based upon First Investors Life's understanding of Federal income tax laws
and regulations as they are currently interpreted. No representation is made
regarding the likelihood of continuation of such laws and regulations or the
current interpretations by the Internal Revenue Service. Any changes in such
laws, regulations or in interpretations may be given retroactive effect.
Moreover, no attempt is made to consider any applicable state or other (e.g.,
estate, gift, or inheritance) tax laws. Each interested person should consult
his tax advisor concerning the matters set forth herein.

First Investors Life believes that the Policy qualifies as a life insurance
contract as defined in Section 7702(a) of the Internal Revenue Code of 1986, as
amended (the "Code"). Consequently, the death benefit should be fully excludable
from the beneficiary's gross income and the Policyowner should generally not be
taxed on the cash values (including increments thereof) under the Policy, until
its actual surrender. With respect to a corporate Policyowner, however, such
"inside build-up" of the Policy may be subject to the alternative minimum tax.

Qualification as a life insurance contract for Federal income tax purposes
depends, in part, upon the satisfaction by Separate Account B of certain
diversification requirements contained in Section 817(h) of the Code. The
Adviser is expected to manage the assets of the Funds in a manner that complies
with these diversification requirements, and under a special "look-through"
rule, satisfaction of such requirements by the Funds will be attributed to
Separate Account B. The look-through rule is applicable because all shares of
the Funds comprising Life Series Fund will be owned only by Separate Account B
(and similar accounts of First Investors Life or other insurance companies) and
access to the Funds will be available exclusively through the purchase of
Policies (and additional variable annuity or life insurance products of First
Investors Life or other insurance companies). Fund shares also may be held by
the Adviser provided such shares are being held in connection with the creation
or management of the Fund. The Adviser does not intend to sell any Fund shares
it owns to the general public. It is possible that future guidelines, if any,
concerning diversification could restrict the rights of a Policyowner with
respect to the selection of investment options.

First Investors Life does not believe that any Policy will be characterized,
at issuance, as a "modified endowment contract" within the meaning of Section
7702A of the Code. Section 7702A and the characterizations given thereunder
generally apply to a Policy that was received in exchange for another that was
issued, on or after June 21, 1988, but only if the policy surrendered in
exchange therefor was deemed to be a modified endowment contract. A Policy that
escapes characterization as a modified endowment contract may nonetheless be
treated as such if a material term of the Policy, e.g., death benefits, is
altered or if the Policy is converted from a term life insurance contract to a
life insurance contract providing a different form of coverage (whether or not
issued before June 21, 1988). If a Policy is treated as a modified endowment
contract, then distributions thereunder (including the proceeds of any surrender
or loan made under, or in result of a pledge or assignment of, the Policy),
after the Policy becomes a modified endowment contract, or within two years
prior thereto, will be includable in gross income and subject to regular Federal
income taxation to the extent of the income in the contract (basically, cash
value less premium paid). An additional 10% tax will also be imposed on the
taxable amount of any such portion, subject to certain exceptions.

<PAGE>

All modified endowment contracts issued by the same insurer (or affiliates)
to the Policyowner during any calendar year generally will be treated as one
Policy for the purpose of applying the modified endowment contract rules. You
should consult your tax advisor if you have questions regarding the possible
impact of the modified endowment contract rules on your Policy.

Subject to the foregoing discussion of modified endowment contracts, any
loans made under a Policy will be treated as indebtedness and no part of such
loan will constitute income to the Policyowner. In addition, the interest on
such loans generally is not deductible.

Upon surrender of a Policy, taxation of the Surrender Value will depend on
the Payment Option that the Owner has selected. If payment is in one sum, the
Owner will be taxed on the income in the Policy at the time payment is made. If
payment is in installments, the Owner may be taxed (1) on all or a portion of
each installment until the income in the Policy has been paid; (2) only after
all investment in the Policy has been paid, or (3) on a portion of each payment.
You should consult your tax advisor if you have questions about the taxation of
a Policy surrender.

Under the Code, income tax must generally be withheld from the taxable
portion of the proceeds paid upon surrender of a Policy, unless the Policyowner
notifies First Investors Life in writing, before the payment date, that such
withholding is not to be made. Failure to withhold or withholding of an
insufficient amount may subject the Policyowner to taxation. In addition,
insufficient withholding and insufficient estimated tax payments may subject the
Policyowner to penalties.

Charges for First Investors Life's Income Taxes

First Investors Life is taxed as a "life insurance company" under Subchapter
L of the Code. Under the applicable provisions of the Code, First Investors Life
will be required to include its variable life insurance operations in its
Federal income tax return. Currently, no charges are made against the
Subaccount(s) for First Investors Life's Federal income taxes attributable to
the Subaccount(s). However, First Investors Life may make such charges in the
future. First Investors Life may charge the Subaccount(s) for its Federal income
taxes attributable to the Subaccount(s) when First Investors Life's tax
treatment and obligations become clarified. Any such charges against a
Subaccount would reduce its Net Investment Return.

Under current laws, First Investors Life may incur state and local taxes (in
addition to premium taxes) in several states. At present, these taxes are not
significant. After First Investors Life's Federal income tax treatment is
clarified, or if prior to that time there is a material change in applicable
state or local tax laws, charges for such taxes, if any, attributable to the
Subaccount(s) may be made.

If any tax charges are made in the future they will be accumulated daily and
transferred from the Subaccount(s) to First Investors Life's General Account.
Any investment earnings on tax charges accumulated in the Subaccount(s) will be
retained by First Investors Life.

VOTING RIGHTS

In accordance with its view of present applicable law, First Investors Life
will vote the Funds' shares held in the corresponding Subaccount(s) at regular
and special meetings of shareholders of Life Series Fund in accordance with
instructions received from Policyowners. Shares of the Funds held by First
Investors Life which do not represent shares attributable to Policyowners will
be represented by First Investors Life at the meeting and voted, on any matter,
in proportion to the instructions from Policyowners. However, if the 1940 Act or
any Regulation thereunder should be

<PAGE>

amended or if the present interpretation thereof should change, and as a result,
First Investors Life determines that it is permitted to vote the Funds' shares
in its own right, it may elect to do so.

The number of Fund shares held in the corresponding Subaccount which is
attributable to each Policyowner is determined by dividing the corresponding
Subaccount's Accumulated Value by the value of one Fund share. The number of
votes which a person has the right to cast will be determined as of the record
date established by Life Series Fund. Voting instructions will be solicited by
written communication prior to the date of the meeting at which votes are to be
cast. Fund shares held in the corresponding Subaccount as to which no timely
instructions are received will be represented at this meeting and voted by First
Investors Life in proportion to the voting instructions which are received with
respect to all Policies participating in the Subaccount. Each person having a
voting interest in the Subaccount will receive reports and other materials
relating to the Fund.

The voting rights described in this Prospectus are created under applicable
Federal securities laws. To the extent that such laws or regulations promulgated
thereunder eliminate the necessity to submit such matters for approval by
persons having voting rights in separate accounts of insurance companies or
restrict such voting rights, First Investors Life reserves the right to proceed
in accordance with any such laws or regulations. First Investors Life also
reserves the right, subject to compliance with applicable law, including
approval of Policyowners if so required, (1) to transfer assets determined by
First Investors Life to be associated with the class of policies to which the
Policies belong from Separate Account B to another separate account by
withdrawing the same percentage of each investment in Separate Account B with
appropriate adjustments to avoid odd lots and fractions, (2) to operate Separate
Account B as a "management company" under the 1940 Act, or in any other form
permitted by law, the investment adviser of which would be First Investors Life
or an affiliate, (3) to deregister Separate Account B under the 1940 Act, and
(4) to operate Separate Account B under the general supervision of a committee
any or all the members of which may be interested persons (as defined in the
1940 Act) of First Investors Life or an affiliate, or to discharge the
Committee. First Investors Life has reserved all rights in respect of its
corporate name and any part thereof, including without limitation the right to
withdraw its use and to grant its use to one or more other separate accounts and
other entities.

OFFICERS AND DIRECTORS OF FIRST INVESTORS LIFE INSURANCE COMPANY

Name Office Principal Occupation for Last 5 Years
---- ------ -------------------------------------
Jay G. Baris Director Partner, Kramer, Leven, Naftalis,
Nessen, Kamin & Frankel, New
York, Attorneys; Secretary and
Counsel, First Financial Savings
Bank, S.L.A., New Jersey.

William H. Drinkwater First Vice First Vice President and Chief
President and Actuary, First Investors Life
Chief Actuary since April, 1992; Vice President
- Actuary, Home Life Insurance
Company, New York, prior thereto.

Lawrence M. Falcon Senior Senior Vice President and
Vice President Comptroller, First Investors
and Comptroller Life.

Richard H. Gaebler President President, First Investors Life.
and Director

William P. Galvin Assistant Manager, First Investors Life;
Vice President Assistant Vice President since
February, 1996; Licensing
Manager, Pfizer, Inc., New York,
New York from May 1990 to
February, 1995.

<PAGE>

Name Office Principal Occupation for Last 5 Years
---- ------ -------------------------------------
George V. Ganter Director Vice President, First Investors Asset
Management Company, Inc., Portfolio
Manager, FIMCO.

Robert J. Grosso Director Assistant Counsel, FIC since January
1995; Business Consultant; Assistant
Vice President and Assistant General
Counsel, Alliance Fund Distributors,
Inc. from September 1993 to August
1994; Of Counsel, Law Office of
Richard S. Mazawey from May 1991 to
September 1993.

Glenn O. Head Chairman and Director Chairman and Director, FICC, FIMCO
and FIC.

Kathryn S. Head Director President, FICC and FIMCO; Vice
President, Chief Financial Officer
and Director, FIC; President and
Director, First Financial Savings
Bank, S.L.A.

Scott Hodes Director Partner, Ross & Hardies, Chicago,
Illinois, Attorneys, since January
1992; prior thereto, Partner, Arvey,
Hodes, Costello & Burman, Chicago,
Illinois, Attorneys.

Paul E. Kunz Assistant Secretary Staff Attorney, First Investors Life;
Assistant Secretary since May, 1995.

Carol Lerner Brown Secretary Assistant Secretary, FIC; Secretary,
FIMCO and FICC.

William M. Lipkus Chief Accounting Chief Accounting Officer, First
Officer Investors Life since June, 1992;
Manager, Tait Weller & Baker, Edison,
New Jersey from June, 1986 to June,
1992.

Jackson Ream Director Senior Vice President, Nations Bank
of Texas (formerly NCNB Texas
National Bank), Dallas, Texas.

Nelson Schaenen Jr. Director Partner, Weiss, Peck & Greer, New
York, Investment Managers.

Ada M. Suchow Vice President Vice President, First Investors Life.

John T. Sullivan Director Director, FIMCO and FIC; Of Counsel
to Hawkins, Delafield & Wood, New
York, Attorneys.

A fidelity bond in the amount of $5,000,000 covering First Investors Life's
officers and employees has been issued by Gulf Insurance Company. A directors
and officers liability policy in the amount of $3,000,000 covering First
Investors Life's directors and officers has been issued by the Great American
Insurance Companies.

DISTRIBUTION OF POLICIES

The Policies distributed by First Investors Life are sold by insurance agents
who are licensed to sell variable life insurance. These agents are paid a
commission of 28.55% of the first year premium payment and 1% of the premium
payments for years two through ten.

The Policies are offered for sale in Alabama, Arizona, Arkansas, Colorado,
Connecticut, Florida, Georgia, Iowa, Illinois, Indiana, Kentucky, Louisiana,
Massachusetts, Maryland, Michigan, Minnesota, Missouri, Mississippi, North
Carolina, Nebraska, New Jersey, New Mexico, New York,

<PAGE>

Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Utah,
Virginia, Washington, West Virginia, Wisconsin and Wyoming.

CUSTODIAN

First Investors Life, subject to applicable laws and regulations, is to be
the custodian of the securities of the Subaccounts. First Investors Life will
maintain the records and accounts of Separate Account B. The assets of the
Subaccounts will be held by United States Trust Company of New York (TIN
13-6065574), 114 W. 47th Street, New York, NY 10036 under a safekeeping
arrangement. Under the terms of a Safekeeping Agreement dated June 16, 1986,
between First Investors Life and United States Trust Company of New York,
securities and similar investments of the Subaccounts shall be deposited in the
safekeeping of United States Trust Company of New York. Such agreement will
remain in effect until Separate Account B has been completely liquidated and the
proceeds of the liquidation distributed to the security holders of Separate
Account B, or a successor custodian, having the requisite qualifications, has
been designated and has accepted such custodianship. First Investors Life is
responsible for the payment of all expenses of, and compensation to, United
States Trust Company of New York in such amounts as may be agreed upon from time
to time. For the fiscal year ended December 31, 1995, First Investors Life paid
$400 to United States Trust Company of New York.

REPORTS

At least once each Policy year, First Investors Life shall mail a report to
the Policyowner within 31 days after the Policy anniversary. The report shall be
mailed to the last address known to First Investors Life. The report will show
the death benefit, cash value and policy debt on the anniversary and any loan
interest for the prior year. The report will also show the allocation of the
investment base on that anniversary. No report will be sent if the Policy is
continued as reduced paid-up or extended term insurance.

STATE REGULATION

First Investors Life is subject to the laws of the State of New York
governing insurance companies and to regulations by the New York State Insurance
Department. An annual statement in a prescribed form is filed with the
Department of Insurance each year covering the operations of First Investors
Life for the preceding year and its financial condition as of the end of such
year.

First Investors Life's books and accounts are subject to review by the
Insurance Department at any time and a full examination of its operations is
conducted periodically. Such regulation does not, however, involve any
supervision of management or investment practices or policies except to
determine compliance with the requirements of the New York Insurance Law. In
addition, First Investors Life is subject to regulation under the insurance laws
of other jurisdictions in which it may operate.

EXPERTS

The financial statements included in this Prospectus have been examined by
Tait, Weller & Baker, independent certified public accountants, and are included
herein in reliance upon the authority of said firm as experts in accounting and
auditing.

<PAGE>

RELEVANCE OF FINANCIAL STATEMENTS

The values of the interests of Policyowners under the Policies will be
affected solely by the investment results of the Subaccount(s). The financial
statements of First Investors Life as contained herein should be considered only
as bearing upon First Investors Life's ability to meet its obligations to
Policyowners under the Policies, and they should not be considered as bearing on
the investment performance of the Subaccount(s).

The most current financial statements of First Investors Life and Separate
Account B are those as of the end of the most recent fiscal year. Neither First
Investors Life nor Separate Account B prepare their financial statements more
often than annually and believe that any incremental benefit to prospective
policyholders that may result from preparing and delivering more current
financial statements, though unaudited, does not justify the additional cost
that would be incurred. In addition, First Investors Life represents that there
have been no adverse changes in the financial condition or operations of First
Investors Life or Separate Account B between the end of the most current fiscal
year and the date of this Prospectus.

APPENDIX I - OTHER POLICY PROVISIONS

Settlement Options

In lieu of a single sum payment of Policy proceeds on death or surrender, an
election may be made to apply all or a portion of the proceeds under any one of
the fixed benefit settlement options provided in the Policy. Tax consequences
may vary depending on the settlement option chosen. The options are stated
below.

PROCEEDS LEFT AT INTEREST. Left on deposit to accumulate with First Investors
Life with interest payable at a rate of 2 1/2% per year.

PAYMENT OF A DESIGNATED AMOUNT. Payable in installments until proceeds
applied under the option and interest on unpaid balance at 2 1/2% per year and
any additional interest are exhausted.

PAYMENT FOR A DESIGNATED NUMBER OF YEARS. Payable in installments for up to
25 years, including interest at 2 1/2% per year. Payments may be increased by
additional interest which would be paid at the end of each installment year.

LIFE INCOME OPTION, GUARANTEED PERIOD. Payments are guaranteed for 10 or 20
years, as elected, and for life thereafter. During the guaranteed period of 10
or 20 years, the payments may be increased by additional interest.

LIFE INCOME, GUARANTEED RETURN. The sum of the payments made and any payments
due at the death of the person on whom the payments are based will never be less
than the proceeds applied.

LIFE INCOME ONLY. Payments will be made only while the person on whom the
payments are based is alive.

Optional Insurance Benefits

On payment of an additional premium and subject to certain age and insurance
underwriting requirements, the following optional provisions, which are subject
to the restrictions and limitations set forth therein, may be included in a
Policy.

<PAGE>

DISABILITY PREMIUM WAIVER. Providing that in the event of the Insured's total
disability before the Policy anniversary nearest to the Insured's 60th birthday
and continuing for at least 6 months, First Investors Life will waive all
premiums falling due after the commencement and during the continuance of such
disability.

TERM INSURANCE. Providing 12 year convertible level term insurance.

General Provisions

BENEFICIARY. The beneficiary is as designated in the application for the
Policy, unless thereafter changed by the Policyowner during the Insured's
lifetime. A change of designation may be made by filing a written request with
the Home Office of First Investors Life in a form acceptable to First Investors
Life.

ASSIGNMENT. The Policy may be assigned by the Policyowner but no assignment
shall be binding on First Investors Life unless it is in writing and filed with
First Investors Life at its Home Office. First Investors Life will assume no
responsibility for the validity or sufficiency of any assignment. Unless
otherwise provided in the assignment, the interest of any revocable beneficiary
shall be subordinate to the interest of any assignee, regardless of when the
assignment was made and the assignee shall receive any sum payable to the extent
of his or her interest.

AGE AND SEX. If the age or sex of the Insured has been misstated, the
benefits available under the Policy will be those which the premiums paid would
have purchased for the correct age and sex.

SUICIDE. If the Insured commits suicide within 2 years from the Policy's date
of issue, the liability of First Investors Life under the Policy will be limited
to all premiums paid less any indebtedness.

INCONTESTABILITY. Except for nonpayment of premiums, the validity of the
Policy and its riders will not be contestable after it has been in force during
the lifetime of the Insured for 2 years from the Date of Issue.

GRACE PERIOD. A Grace Period of 31 days will be allowed for payment of each
premium after the first. The Policy will continue in force during the Grace
Period unless surrendered.

PAYMENTS AND DEFERMENT. Payment of the death benefit or surrender value or
loan proceeds will usually be made within 7 days after receipt by First
Investors Life of all documents required for such payments. However, payment may
be delayed if the amount cannot be determined because the New York Stock
Exchange is closed for trading or the Securities and Exchange Commission
determines that a state of emergency exists.

Under a Policy continued as paid-up or extended term insurance, the payment
of the surrender value or loan proceeds may be deferred for up to six months. If
the payment is postponed more than 30 days, interest at a rate of not less than
3% will be paid on the Surrender Value. The interest will be paid from the date
of surrender to the date payment is made.

DIVIDENDS. The Policies do not provide for dividend payments and therefore
are considered "non- participating" in the earnings of First Investors Life.

<PAGE>

APPENDIX II
ADDITIONAL ILLUSTRATIONS OF DEATH BENEFITS,
CASH VALUES AND ACCUMULATED PREMIUMS

Tables on Pages 30 to 32 illustrate the way in which a Policy operates. They
show how the death benefit and the cash value may vary over an extended period
of time assuming hypothetical rates of investment return for the Subaccount(s)
equivalent to constant gross annual rates of 0%, 6% and 12%. The table on Page
30 is based on an annual premium of $600 for a male issue age 10, the table on
Page 31 is based on an annual premium of $1,200 for a male issue age 25, and the
table on Page 32 is based on an annual premium of $1,800 for a male issue age
40. The illustrations assume a standard risk classification and will assist in
the comparison of death benefits and cash values under the Policies with those
under other variable life policies issued by First Investors Life or other
companies. Please refer to Page 17 for additional discussion and to Pages 19 to
21 for additional illustrations of death benefits, cash values and accumulated
premiums which assume a hypothetical gross annual investment return of 0%, 4%
and 8%.

The amounts shown are as of the end of each Policy year and take into account
deductions from the annual premium and the daily charge for investment advisory
services and mortality and expense risk equivalent to an effective annual charge
of 1.45%. Taking account of the daily charges, the gross annual rates of
investment return of 0%, 6% and 12% correspond to net annual rates of
approximately -1.45%, 4.55% and 10.55%, respectively. The returns shown are also
net of any tax charges attributable to the Subaccount(s).

The second column of each table shows the amount to which the total premiums
paid to the end of the Policy year during the premium paying period would
accumulate if an amount equal to those premiums were invested to earn interest,
after taxes, at 5% compounded annually.

First Investors Life will furnish upon request a comparable illustration
reflecting the proposed Insured's age and the face amount or premium amount
requested, and assuming that premiums are paid on an annual basis and the
proposed Insured is a standard risk. In addition, a comparable illustration will
be included at the delivery of a Policy if a purchase is made reflecting the
Insured's risk classification if other than standard.

<PAGE>

Male Issue Age 10
$600 Annual Premium for Standard Risk (1)
$39,638 Face Amount (Guaranteed Minimum Death Benefit)

<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $600 $ 630 $39,638 $39,645 $ 39,729 $ 138 $ 148 $ 158
2 600 1,291 39,638 39,669 40,061 586 633 682
3 600 1,986 39,638 39,710 40,642 1,023 1,136 1,256
4 600 2,715 39,638 39,767 41,482 1,450 1,656 1,884
5 600 3,481 39,638 39,841 42,599 1,889 2,219 2,597
6 600 4,285 39,638 39,932 44,005 2,316 2,800 3,375
7 600 5,129 39,638 40,039 45,711 2,734 3,402 4,227
8 600 6,016 39,638 40,161 47,732 3,143 4,026 5,160
9 600 6,947 39,638 40,299 50,081 3,547 4,676 6,184
10 600 7,924 39,638 40,453 52,774 3,946 5,354 7,309

15 0 11,608 39,638 41,363 70,965 4,473 7,632 13,094

20 0 14,816 39,638 42,310 95,773 4,010 9,176 20,771

25 0 18,909 39,638 43,278 129,224 3,610 11,076 33,073

30 0 24,133 39,638 44,269 174,378 3,244 13,343 52,561

Attained
Age
65 0 81,723 39,638 49,597 785,431 1,685 30,247 479,001
</TABLE>

(1) Corresponds to $306.00 semi annually; $156.00 quarterly, or $52.98 monthly.

(2) Assumes no policy loan is made.

<PAGE>

Male Issue Age 25
$1,200 Annual Premium for Standard Risk (1)
$51,908 Face Amount (Guaranteed Minimum Death Benefit)

<TABLE>
<CAPTION>
Total Death Benefit (2) Cash Values (2)
End of Premiums Assuming Hypothetical Gross (After Assuming Hypothetical Gross (After
Policy Premium Paid Plus Tax) Annual Investment Return of Tax) Annual Investment Return of
Year Due Interest at 5% 0% 6% 12% 0% 6% 12%
- -------- --------- -------------- -------------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $1,200 $ 1,260 $51,908 $51,921 $ 52,078 $ 409 $ 439 $ 469
2 1,200 2,583 51,908 51,955 52,558 1,308 1,423 1,542
3 1,200 3,972 51,908 52,011 53,359 2,197 2,454 2,727
4 1,200 5,431 51,908 52,088 54,495 3,076 3,532 4,037
5 1,200 6,962 51,908 52,188 55,994 3,992 4,710 5,535
6 1,200 8,570 51,908 52,308 57,870 4,897 5,941 7,187
7 1,200 10,259 51,908 52,450 60,141 5,791 7,226 9,008
8 1,200 12,032 51,908 52,612 62,823 6,673 8,568 11,014
9 1,200 13,893 51,908 52,794 65,934 7,544 9,969 13,222
10 1,200 15,848 51,908 52,996 69,495 8,404 11,430 15,653

15 0 23,217 51,908 54,188 93,429 9,524 16,333 28,161

20 0 29,631 51,908 55,430 126,119 8,504 19,562 44,508

25 0 37,818 51,908 56,702 170,313 7,539 23,273 69,903

30 0 48,266 51,908 58,005 230,101 6,628 27,467 108,958

Attained
Age
65 0 78,620 51,908 60,711 420,822 4,947 37,025 256,641
</TABLE>

(1) Corresponds to $612.00 semi annually; $312.00 quarterly, or $105.96
monthly.

(2) Assumes no policy loan is made.

<PAGE>

Male Issue Age 40
$1,800 Annual Premium for Standard Risk (1)
$47,954 Face Amount (Guaranteed Minimum Death Benefit)
<TABLE>
<CAPTION>
Total Death Benefit (2) Cash Values (2)
End of Premiums Assuming Hypothetical Gross (After Assuming Hypothetical Gross (After
Policy Premium Paid Plus Tax) Annual Investment Return of Tax) Annual Investment Return of
Year Due Interest at 5% 0% 6% 12% 0% 6% 12%
- -------- --------- -------------- --------------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $1,800 $ 1,890 $47,954 $47,968 $ 48,144 $ 762 $ 817 $ 872
2 1,800 3,874 47,954 48,002 48,621 2,097 2,289 2,488
3 1,800 5,958 47,954 48,056 49,393 3,406 3,819 4,263
4 1,800 8,146 47,954 48,129 50,473 4,689 5,409 6,211
5 1,800 10,443 47,954 48,222 51,886 6,020 7,138 8,431
6 1,800 12,856 47,954 48,335 53,645 7,328 8,937 10,869
7 1,800 15,388 47,954 48,467 55,766 8,615 10,809 13,548
8 1,800 18,048 47,954 48,617 58,266 9,884 12,760 16,491
9 1,800 20,840 47,954 48,786 61,164 11,137 14,792 19,724
10 1,800 23,772 47,954 48,973 64,480 12,375 16,911 23,276

15 0 34,825 47,954 50,080 86,798 13,764 23,714 41,101

20 0 44,447 47,954 51,233 117,342 11,963 27,690 63,419

25 0 56,727 47,954 52,416 158,741 10,274 31,966 96,809

30 0 72,399 47,954 53,630 214,919 8,695 36,402 145,879

Attained
Age
65 0 56,727 47,954 52,416 158,741 10,274 31,966 96,809
</TABLE>

(1) Corresponds to $918.00 semi annually; $468.00 quarterly, or $158.94
monthly.

(2) Assumes no policy loan is made.

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The Board of Directors
First Investors Life Insurance Company
New York, New York

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

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

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

As discussed in note 7 to the financial statements, the Company changed its
method of accounting for income taxes.

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
February 19, 1996

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
BALANCE SHEETS

<TABLE>
<CAPTION>
ASSETS
December 31, 1995 December 31,1994
----------------- ----------------
Investments (note 2):
<S> <C> <C>
Available-for-sale securities....................................... $113,815,086 $103,898,007
Held-to-maturity securities......................................... 5,942,604 5,990,367
Short term investments.............................................. 5,160,201 6,964,868
Policy loans........................................................ 17,016,692 14,686,101
------------- -----------

Total investments................................................ 141,934,583 131,539,343

Cash.................................................................. 1,189,030 977,113
Premiums and other receivables, net of allowances of
$30,000 in 1995 and 1994............................................ 4,334,595 3,901,489
Accrued investment income............................................. 2,833,561 2,593,771
Deferred policy acquisition costs (note 6)............................ 17,318,214 19,321,891
Deferred Federal income taxes (note 7) ........................... 12,000 1,884,000
Furniture, fixtures and equipment, at cost, less accumulated
depreciation of $800,593 in 1995 and $697,010 in 1994............... 236,736 243,634
Other assets.......................................................... 123,509 193,780
Separate account assets............................................... 344,568,486 232,913,278
------------- -----------

Total assets..................................................... $512,550,714 $393,568,299
============= ============

LIABILITIES AND STOCKHOLDER'S EQUITY

LIABILITIES:
Policyholder account balances (note 6)................................ $113,374,173 $115,256,764
Claims and other contract liabilities................................. 11,289,108 10,737,716
Accounts payable and accrued liabilities.............................. 4,150,250 3,463,635
Separate account liabilities.......................................... 343,956,938 232,913,278
------------- -----------

Total liabilities................................................ 472,770,469 362,371,393
------------- -----------

STOCKHOLDER'S EQUITY:
Common Stock, par value $4.75; authorized,
issued and outstanding 534,350 shares............................... 2,538,163 2,538,163
Additional paid in capital............................................ 6,496,180 6,496,180
Unrealized holding gains (losses) on available-for-sale
securities (note 2)................................................. 1,878,000 (2,486,000)
Retained earnings .................................................... 28,867,902 24,648,563
------------- -----------

Total stockholder's equity....................................... 39,780,245 31,196,906
------------- -----------

Total liabilities and stockholder's equity....................... $512,550,714 $393.568,299
============= ============
</TABLE>

See accompanying notes to financial statements.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended
December 31, 1995 December 31,1994 December 31,1993
----------------- ---------------- ----------------
<S> <C> <C> <C>
REVENUES
Policyholder fees................................... $19,958,420 $16,433,269 $14,825,696
Premiums............................................ 7,293,719 7,630,182 8,141,342
Investment income (note 2).......................... 9,363,212 8,835,356 8,470,643
Realized gain (loss) on fixed securities............ 373,582 (259,987) 318,372
Other income........................................ 835,703 701,355 654,608
------------ ------------ ------------

Total income..................................... 37,824,636 33,340,175 32,410,661
------------ ------------ ------------

BENEFITS AND EXPENSES
Benefits and increases in contract liabilities...... 13,027,516 14,297,499 13,118,328
Dividends to policyholders.......................... 954,384 910,754 985,756
Amortization of deferred acquisition costs (note 6). 1,672,429 1,573,216 1,528,876
Commissions and general expenses.................... 15,773,968 13,513,644 13,212,536
------------ ------------ ------------

Total benefits and expenses...................... 31,428,297 30,295,113 28,845,496
------------ ------------ ------------

Income before Federal income tax and cumulative
effect of a change in accounting principle........... 6,396,339 3,045,062 3,565,165

Federal income tax (note 7):
Current............................................. 2,553,000 838,000 1,425,000
Deferred............................................ (376,000) (352,000) (721,000)
------------ ------------ ------------

2,177,000 486,000 704,000
------------ ------------ ------------

Income before cumulative effect
of a change in accounting principle................. 4,219,339 2,559,062 2,861,165

Cumulative effect on prior years
of a change in accounting principle (note 7)........ -- -- 540,000
------------ ------------ ------------

Net Income............................................ $ 4,219,339 $ 2,559,062 $ 3,401,165
============ ============ ============

Income per share, based on 534,350 shares outstanding
Income before cumulative effect
of a change in accounting principle................. $7.90 $4.79 $5.35
Cumulative effect of a change in accounting principle. -- -- 1.01
------------ ------------ ------------
$7.90 $4.79 $6.36
============ ============ ============
</TABLE>

See accompanying notes to financial statements.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF STOCKHOLDER'S EQUITY
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended
December 31,1995 December 31,1994 December 31, 1993
---------------- ---------------- -----------------
<S> <C> <C> <C>
Balance at beginning of year ....................................... $ 31,196,906 $ 34,173,844 $ 27,722,679
Net income ......................................................... 4,219,339 2,559,062 3,401,165
Increase (decrease) in unrealized holding gains on
available-for-sale securities .................................... 4,364,000 (5,536,000) 3,050,000
------------ ------------ ------------
Balance at end of year ............................................. $ 39,780,245 $ 31,196,906 $ 34,173,844
============ ============ ============
</TABLE>

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended
December 31, 1995 December 31, 1994 December 31,1993
----------------- ----------------- ----------------
<S> <C> <C> <C>
Increase (decrease) in cash:
Cash flows from operating activities:
Policyholder fees received ........................................ $ 19,374,522 $ 16,433,269 $ 14,825,696
Premiums received ................................................. 6,895,096 7,366,276 7,996,528
Amounts received on policyholder accounts ......................... 87,156,662 63,526,544 52,654,219
Investment income received ........................................ 9,360,894 8,886,847 8,583,113
Other receipts .................................................... 69,621 46,581 44,193
Benefits and contract liabilities paid ............................ (101,642,156) (75,131,594) (61,360,490)
Commissions and general expenses paid ............................. (18,176,870) (15,252,935) (15,866,354)
------------- ------------- -------------

Net cash provided by (used for) operating activities .............. 3,037,769 5,874,988 6,876,905
------------- ------------- -------------

Cash flows from investing activities:
Proceeds from sale of investment securities ....................... 58,755,827 36,751,082 36,063,998
Purchase of investment securities ................................. (58,622,646) (42,164,770) (39,148,690)
Purchase of furniture, equipment and other assets ................. (128,442) (67,121) (40,227)
Net increase in policy loans ...................................... (2,330,591) (1,801,780) (1,941,256)
Investment in Separate Account .................................... (500,000) -- --
-------------

Net cash provided by (used for) investing activities .............. (2,825,852) (7,282,589) (5,066,175)
------------- ------------- -------------

Net increase (decrease) in cash ................................... 211,917 (1,407,601) 1,810,730

Cash
Beginning of year .................................................... 977,113 2,384,714 573,984
------------- ------------- -------------
End of year........................................................... $ 1,189,030 $ 977,113 $ 2,384,714
============= ============= =============
</TABLE>

The Company received a refund of Federal income tax of $102,000 in 1995 and paid
Federal income tax of $2,125,000 in 1995, $1,368,000 in 1994 and $1,265,000 in
1993.

See accompanying notes to financial statements.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
Year ended Year Ended Year Ended
December 31, 1995 December 31, 1994 December 31, 1993
----------------- ----------------- -----------------
<S> <C> <C> <C>
Reconciliation of net income to net cash
provided by (used for) operating
activities:
Net income ....................................................... $ 4,219,339 $ 2,559,062 $ 3,401,165

Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation and amortization .................................. 141,121 122,199 118,365
Amortization of deferred policy acquisition costs .............. 1,672,429 1,573,216 1,528,876
Realized investment (gains) losses ............................. (373,582) 259,987 (318,372)
Amortization of premiums and discounts on fixed
maturities .................................................. 237,472 287,340 299,666
Deferred Federal income taxes .................................. (376,000) (352,000) (721,000)
Cumulative effect of a change in
accounting principle ........................................ -- -- (540,000)
Other items not requiring cash - net ........................... (112,268) (149) (1,908)

(Increase) decrease in:
Premiums and other receivables, net ............................ (433,106) (1,055,910) 1,683,261
Accrued investment income ...................................... (239,790) (235,849) (187,196)
Deferred policy acquisition costs, exclusive
of amortization ............................................. (1,117,752) (1,138,988) (1,254,547)
Other assets ................................................... 64,490 (30,882) (13,108)

Increase (decrease) in:
Policyholder account balances .................................. (1,882,591) 2,719,458 1,268,788
Claims and other contract liabilities .......................... 551,392 503,025 1,903,908
Accounts payable and accrued liabilities ....................... 686,615 664,479 (290,993)
----------- ----------- -----------

$ 3,037,769 $ 5,874,988 $ 6,876,905
=========== =========== ===========
</TABLE>

See accompanying notes to financial statements.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS

Note 1 -- Basis of Financial Statements

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles (GAAP). Such basis of presentation
differs from statutory accounting practices permitted or prescribed by insurance
regulatory authorities primarily in that:

(a) policy reserves are computed according to the Company's estimates
of mortality, investment yields, withdrawals and other benefits and
expenses, rather than on the statutory valuation basis;

(b) certain expenditures, principally for furniture and equipment and
agents' debit balances, are recognized as assets rather than being
non-admitted and therefore charged to retained earnings;

(c) commissions and other costs of acquiring new business are
recognized as deferred acquisition costs and are amortized over the premium
paying period of policies and contracts, rather than charged to current
operations when incurred;

(d) income tax effects of temporary differences, relating primarily to
policy reserves and acquisition costs, are provided;

(e) the statutory asset valuation and interest maintenance reserves
are reported as retained earnings rather than as liabilities;

Note 2 -- Other Significant Accounting Practices

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

(b) Depreciation. Depreciation is computed on the useful service life of the
depreciable asset using the straight line method of depreciation.

(c) Investments. Investments in equity securities that have readily
determinable fair values and all investments in debt securities are classified
in three separate categories and accounted for as follows:

Held-to-Maturity Securities

Debt securities the Company has the positive intent and ability to
hold to maturity are recorded at amortized cost.

Trading Securities

Debt and equity securities that are held principally for the
purpose of selling such securities in the near term are recorded at
fair value with unrealized gains and losses included in earnings.

Available-For-Sale Securities

Debt and equity securities not classified in the other two
categories are recorded at fair value with unrealized gains and
losses excluded from earnings and reported as "unrealized holding
gains or losses on available-for-sale securities" in stockholder's
equity.

Short term investments are reported at market value which approximates cost.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

Gains and losses on sales of investments are determined using the specific
identification method. Investment income for the years indicated consists of the
following:

<TABLE>
<CAPTION>
Year ended Year Ended Year Ended
December 31,1995 December 31, 1994 December 31,1993
---------------- ----------------- ----------------
<S> <C> <C> <C>
Interest on fixed maturities .................................. $8,243,748 $8,091,627 $7,844,723
Interest on short term investments ............................ 451,475 225,682 232,244
Interest on policy loans ...................................... 973,242 886,465 771,082
Dividends on equity securities ................................ 58,305 10,220 --
---------- ---------- ----------

Total investment income .................................. 9,726,770 9,213,994 8,848,049
Investment expense ....................................... 363,558 378,638 377,406
---------- ---------- ----------

Net investment income ......................................... $9,363,212 $8,835,356 $8,470,643
========== ========== ==========
</TABLE>

The amortized cost and estimated market values of investments at December
31, 1995 and 1994 are as follows:

<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Available-For-Sale Securities
December 31, 1995
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ........................................ $ 40,056,913 $ 1,459,984 $ -- $ 41,516,897
Debt Securities issued by
States of the U.S. .................................. 9,067,445 215,464 10,295 9,272,614
Corporate Debt Securities ............................ 53,636,330 1,872,502 121,193 55,387,639
Equity Securities .................................... 500,000 55,000 -- 555,000
Other Debt Securities ................................ 7,010,398 78,876 6,338 7,082,936
------------ ------------ ------------ ------------
$110,271,086 $ 3,681,826 $ 137,826 $113,815,086
============ ============ ============ ============

December 31,1994
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ........................................ $ 49,362,608 $ 5,901 $ 1,541,620 $ 47,826,889
Debt Securities issued by
States of the U.S. .................................. 3,910,143 -- 379,945 3,530,198
Corporate Debt Securities ............................ 53,768,481 86,359 2,578,037 51,276,803
Equity Securities .................................... 500,000 -- 15,000 485,000
Other Debt Securities ................................ 873,777 1,801 96,461 779,117
------------ ------------ ------------ ------------
$108,415,009 $ 94,061 $ 4,611,063 $103,898,007
============ ============ ============ ============
</TABLE>

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

At December 31, 1995 and 1994, the Company recognized "Unrealized Holding
Gains (Losses) on Available-For- Sale Securities" of $1,878,000 and
($2,486,000), net of applicable deferred income taxes and amortization of
deferred acquisition costs. The change in the Unrealized Holding Gains (Losses)
of $4,364,000, ($5,536,000) and $3,050,000 for 1995, 1994 and 1993, respectively
is reported as a separate component of stockholders' equity.

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Held-To-Maturity Securities
December 31, 1995
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ............................................ $3,332,604 $ 120,983 $ -- $3,453,587
Corporate Debt Securities ................................ 2,000,000 -- 40,412 1,959,588
Other Debt Securities .................................... 610,000 -- -- 610,000
---------- ---------- ---------- ----------
$5,942,604 $ 120,983 $ 40,412 $6,023,175
========== ========== ========== ==========

December 31, 1994
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies ............................................ $3,380,367 $ 4,873 $ 56,807 $3,328,433
Corporate Debt Securities ................................ 2,000,000 -- 324,020 1,675,980
Other Debt Securities .................................... 610,000 -- -- 610,000
---------- ---------- ---------- ----------
$5,990,367 $ 4,873 $ 380,827 $5,614,413
========== ========== ========== ==========
</TABLE>

The amortized cost and estimated market value of debt securities at December
31, 1995, by contractual maturity, are shown below. Expected maturities will
differ from contractual maturities because borrowers may have the right to call
or prepay obligations with or without call or prepayment penalties.

<TABLE>
<CAPTION>
Held to Maturity Available For Sale
--------------------------- -----------------------------
Amortized Estimated Amortized Estimated
Cost Market Value Cost Market Value
---------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
Due in one year or less....................... $2,239,580 $2,251,899 $ 6,162,578 $ 6,227,117
Due after one year through five years......... 361,632 362,031 32,404,977 34,434,038
Due after five years through ten years........ 1,341,392 1,449,657 52,785,501 53,846,181
Due after ten years........................... 2,000,000 1,959,588 18,418,030 18,752,750
---------- ---------- ------------ ------------
$5,942,604 $6,023,175 $109,771,086 $113,260,086
========== ========== ============ ============
</TABLE>

Proceeds from sales of investments in fixed maturities were $56,949,635,
$36,701,082 and $35,352,716 in 1995, 1994 and 1993, respectively. Gross gains of
$578,810 and gross losses of $205,228 were realized on those sales in 1995.
Gross gains of $85,827 and gross losses of $345,814 were realized on those sales
in 1994. Gross gains of $397,829 and gross losses of $79,457 were realized on
those sales in 1993.

(d) Recognition of Revenue, Policyholder Account Balances and Policy Benefits

Traditional Ordinary Life and Health

Revenues from the traditional life insurance policies represent
premiums which are recognized as earned when due. Health insurance
premiums are recognized as revenue over the time period to which the
premiums relate. Benefits and expenses are associated with earned
premiums so as to result in recognition of profits over the lives of
the contracts. This association is accomplished by means of the
provision for liabilities for future policy benefits and the deferral
and amortization of policy acquisition costs.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

Universal Life and Variable Life

Revenues from universal life and variable life policies represent
amounts assessed against policyholders. Included in such assessments
are mortality charges, surrender charges and policy service fees.

Policyholder account balances on universal life consist of the
premiums received plus credited interest, less accumulated
policyholder assessments. Amounts included in expense represent
benefits in excess of policyholder account balances. The value of
policyholder accounts on variable life are included in separate
account liabilities as discussed below.

Annuities

Revenues from annuity contracts represent amounts assessed
against contractholders. Such assessments are principally sales
charges, administrative fees, and in the case of variable annuities,
mortality and expense risk charges. The carrying value and fair value
of fixed annuities are equal to the policyholder account balances,
which represent the net premiums received plus accumulated interest.

(e) Separate Accounts. Separate account assets and the related liabilities,
both of which are valued at market, represent segregated variable annuity and
variable life contracts maintained in accounts with individual investment
objectives. All investment income (gains and losses of these accounts) accrues
directly to the contractholders and therefore does not affect net income of the
Company.

(f) Reclassifications. Certain reclassifications have been made to the 1993
and 1994 Financial Statements in order to conform to the 1995 presentation.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

Note 3 -- Fair Value of Financial Instruments

The carrying amounts for cash, short-term investments and policy loans as
reported in the accompanying balance sheet approximate their fair values. The
fair values for fixed maturities and equity-securities are based upon quoted
market prices, where available or are estimated using values from independent
pricing services.

The carrying amounts for the Company's liabilities under investment - type
contracts approximate their fair values because interest rates credited to
account balances approximate current rates paid on similar investments and are
generally not guaranteed beyond one year. Fair values for the Company's
insurance contracts other than investment - type contracts are not required to
be disclosed. However, the fair values of liabilities for all insurance
contracts are taken into consideration in the overall management of interest
rate risk, which minimizes exposure to changing interest rates.

Note 4 -- Retirement Plans

The Company has a non-contributory profit sharing plan for the benefit of its
employees which provides for retirement benefits based upon earnings. Vesting of
benefits is based upon years of service. The Company did not make profit sharing
contributions in 1995, 1994 and 1993.

The Company also has a non-contributory retirement plan for the benefit of
its sales agents. The plan provides for retirement benefits based upon
commission on first-year premiums and length of service. The plan is unfunded.
Vesting of benefits is based upon graduated percentages dependent upon the
number of allocations made in accordance with the plan by the Company for each
participant. The Company charged to operations pension expenses of approximately
$375,000 in 1995, $312,000 in 1994 and $292,000 in 1993. The accrued liability
of approximately $2,621,000 in 1995 and $2,415,000 in 1994 was sufficient to
cover the value of benefits provided by the plan.

Note 5 -- Commitments and Contingent Liabilities

The Company has agreements with affiliates and non-affiliates as follows:

(a) The Company's maximum retention on any one life is $100,000. The Company
reinsures a portion of its risk with other insurance companies and reserves are
reduced by the amount of reserves for such reinsured risks. The Company is
liable for any obligations which any reinsurance company may be unable to meet.
The Company had reinsured approximately 10% of its net life insurance in force
at December 31, 1995, 1994 and 1993. The Company also had assumed reinsurance
amounting to approximately 20%, 21% and 22% of its net life insurance in force
at the respective year ends. None of these transactions had any material effect
on the Company's operating results.

(b) The Company and certain affiliates share office space, data processing
facilities and management personnel. Charges for these services are based upon
space occupied, usage of data processing facilities and time allocated to
management. During the years ended December 31, 1995, 1994 and 1993, the Company
paid approximately $1,282,000, $1,099,000 and $1,187,000, respectively, for
these services. In addition, the Company reimbursed an affiliate approximately
$196,000 in 1993 for its share of the cost of the branch offices and
approximately $8,739,000 in 1995, $6,651,000 in 1994,and $5,510,000 in 1993 for
commissions relating to the sale of its products.

(c) The Company is subject to certain claims and lawsuits arising in the
ordinary course of business. In the opinion of management, all such claims
currently pending will not have a material adverse effect on the financial
position of the Company or its results of operations.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

Note 6 -- Adjustments Made to Statutory Accounting Practices

Note 1 describes some of the common differences between statutory practices
and generally accepted accounting principles. The effects of these differences
for the years ended December 31, 1995, 1994 and 1993 are shown in the following
table in which net income and capital shares and surplus reported therein on a
statutory basis are adjusted to a GAAP basis.

<TABLE>
<CAPTION>
Net Income Capital Shares and Surplus
Year Ended December 31 at December 31
---------------------------------- -----------------------------------
1995 1994 1993 1995 1994 1993
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Reported on a statutory basis ............ $3,593,786 $2,205,814 $1,682,537 $21,600,537 $18,020,531 $15,933,807

Adjustments:
Deferred policy acquisition costs (b) . (554,677) (434,228) (274,329) 17,318,214 19,321,891 19,006,119
Future policy benefits (a) ............ 422,387 727,849 669,990 (2,912,483) (3,334,870) (4,062,719)
Deferred income taxes ................. 376,000 352,000 1,261,435 12,000 1,884,000 (1,322,799)
Premiums due and deferred (e) ......... 80,133 70,968 11,558 (1,444,568) (1,524,702) (1,595,669)
Cost of colletion and other statutory
liabilities ......................... (16,318) (32,454) 8,598 49,267 65,585 98,039
Non-admitted assets ................... -- -- -- 395,758 385,500 423,038
Asset valuation reserve ............... -- -- 1,016,830 901,041 744,264
Interest maintenance reserve .......... (40,804) (71,048) (222,809) 200,690 (5,070) 325,965
Gross unrealized holding gains (losses)
on available-for-sale securities .... -- -- -- 3,544,000 (4,517,000) 4,623,799
Net realized capital gains (losses) ... 373,582 (259,987) 262,712 -- -- --
Other ................................. (14,750) 148 1,473 -- -- --
625,553 353,248 1,718,628 18,179,708 13,176,375 18,240,037

In accordance with generally accepted
accounting principles ................. $4,219,339 $2,559,062 $3,401,165 $39,780,245 $31,196,906 $34,173,844

Per share, based on 534,350 shares
outstanding ........................... $7.90 $4.79 $6.36 $74.45 $58.38 $63.95
</TABLE>

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

The following is a description of the significant policies used to adjust the
net income and capital shares and surplus from a statutory to a GAAP basis. (a)
Liabilities for future policy benefits have been computed primarily by the net
level premium method with assumptions as to anticipated mortality, withdrawals
and investment yields. The composition of the policy liabilities and the more
significant assumptions pertinent thereto are presented below:

<TABLE>
<CAPTION>
Distribution of Liabilities* Basis of Assumptions
- -----------------------------------------------------------------------------------------------------------
Years
1995 1994 of Issue Interest Mortality Table Withdrawal
- ------------- ------------ ------------ -------- ---------------------------------- ----------
Non-par:
<S> <C> <C> <C> <C> <C>
$ 1,722,604 $ 1,721,636 1962-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton B
5,668,858 5,764,026 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton B
2,574,079 2,583,886 1984-1988 7 1/2% 85% of 1965-70 Basic Select Modified
plus Ultimate Linton B
74,055 62,830 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Linton B
109,919 99,022 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Actual
39,885 41,021 1989-Present 8% 1975-80 Basic Select plus Ultimate Actual
31,896,847 31,043,074 1985-Present 6% Accumulation of Funds --
Par:
224,307 232,295 1966-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton A
13,557,033 13,696,383 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton A
988,555 1,037,503 1981-1984 7 1/4% 90% of 1965-70 Basic Select
plus Ultimate Linton B
4,713,069 4,634,783 1983-1988 9 1/2% 80% of 1965-70 Basic Select
plus Ultimate Linton B
12,459,045 9,922,152 1990-Present 8% 66% of 1975-80 Basic Select
plus Ultimate Linton B
Annuities:
25,202,605 32,707,541 1976-Present 5 1/2% Accumulation of Funds --
Miscellaneous:
15,161,153 12,776,574 1962-Present 2 1/2%-3 1/2% 1958-CSO None
</TABLE>

- ----------

* The above amounts are before deduction of deferred premiums of $1,017,841
in 1995 and $1,065,962 in 1994.

(b) The costs of acquiring new business, principally commissions and related
agency expenses, and certain costs of issuing policies, such as medical
examinations and inspection reports, all of which vary with and are primarily
related to the production of new business, have been deferred. Costs deferred on
universal life and variable life are amortized as a level percentage of the
present value of anticipated gross profits resulting from investment yields,
mortality and surrender charges. Costs deferred on traditional ordinary life and
health are amortized over the premium-paying period of the related policies in
proportion to the ratio of the annual premium revenue to the total anticipated
premium revenue. Anticipated premium revenue was estimated using the same
assumptions which were used for computing liabilities for future policy
benefits. Amortization of $1,672,429 in 1995, $1,573,216 in 1994 and $1,528,876
in 1993 was charged to operations.

(c) Participating business represented 11.1% and 11.9% of individual life
insurance in force at December 31, 1995 and 1994, respectively.

The Board of Directors annually approves a dividend formula for calculation
of dividends to be distributed to participating policyholders.

The portion of earnings of participating policies that can inure to the
benefit of shareholders is limited to the larger of 10% of such earnings or $.50
per thousand dollars of participating insurance in force. Earnings in excess of
that limit must be excluded from shareholders' equity by a charge against
operations. No such charge has been made, since participating business has
operated at a loss to date on a statutory basis. It is anticipated, however,
that the participating lines will be profitable over the lives of the policies.

(d) New York State insurance law prohibits the payment of dividends to
stockholders from any source other than the statutory unassigned surplus. The
amount of said surplus was $11,815,645, $8,235,339 and $6,148,130 at December
31, 1995, 1994 and 1993, respectively.

(e) Statutory due and deferred premiums are adjusted to conform to the
expected premium revenue used in computing future benefits and deferred policy
acquisition costs. In this regard, the GAAP due premium is recorded as an asset
and the GAAP deferred premium is applied against future policy benefits.

<PAGE>

FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (Continued)

Note 7 -- Federal Income Taxes

The Company joins with its parent company and other affiliated companies in
filing a consolidated Federal income tax return. The provision for Federal
income taxes is determined on a separate company basis.

Retained earnings at December 31, 1995 included approximately $146,000 which
is defined as "policyholders' surplus" and may be subject to Federal income tax
at ordinary corporate rates under certain future conditions, including
distributions to stockholders.

The Company adopted Statement of Financial Accounting Standards No. 109,
"Accounting For Income Taxes" ("SFAS 109"), effective January 1, 1993. SFAS 109
is an asset and liability approach that requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of events that
have been recognized in the Company's financial statements or tax returns.
Financial statements for the prior years were not restated and the cumulative
effect of the accounting change as of January 1, 1993 was to increase earnings
by $540,000. This amount is reflected in the 1993 accompanying Statement of
Income as the cumulative effect of a change in accounting principle. It
primarily represents the impact of adjusting deferred taxes to reflect the
current tax rate of 34% as opposed to the tax rates that were in effect when the
deferred taxes were originally recorded.

Deferred tax liabilities (assets) are comprised of the following:

<TABLE>
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
Policyholder dividend provision ................................... $ (323,612) $ (309,818)
Non-qualified agents' pension plan reserve ........................ (1,044,728) (967,466)
Deferred policy acquisition costs ................................. 2,968,214 3,521,550
Future policy benefits ............................................ (2,639,345) (2,862,789)
Bond discount ..................................................... 27,842 20,182
Unrealized holding gains (losses) on Available-For-Sale Securities 967,000 (1,281,000)
Other ............................................................. 32,629 (4,659)
----------- -----------
$ (12,000) $(1,884,000)
=========== ===========
</TABLE>

The currently payable Federal Income tax provision of $838,000 for 1994 is
net of a $102,000 Federal tax benefit resulting from a capital loss carry back
of $259,987.

A reconciliation of the Federal statutory income tax rate to the Company's
effective tax rate is as follows:

1995 1994 1993
---- ---- ----
Application of statutory tax rate ..................... 34% 34% 34%
Special tax deduction for life insurance companies .... -- (18) (16)
Other ................................................. -- -- 2
-- --- ---
34% 16% 20%
== === ===

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The Board of Directors
First Investors Life Insurance Company
New York, New York

We have audited the statement of assets and liabilities of First Investors
Life Level Premium Variable Life Insurance (a separate account of First
Investors Life Insurance Company, registered as a unit investment trust under
the Investment Company Act of 1940), as of December 31, 1995, and the related
statement of operations for the year then ended and changes in net assets for
each of the two years in the period then ended. 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.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of First Investors Life Level
Premium Variable Life Insurance as of December 31, 1995, and the results of its
operations for the year then ended and the changes in its net assets for each of
the two years in the period then ended, in conformity with generally accepted
accounting principles.

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
February 19, 1996

<PAGE>

FIRST INVESTORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE

STATEMENT OF ASSETS AND LIABILITIES

December 31, 1995

ASSETS
Investments at net asset value (Note 3):
First Investors Life Series Fund .......................... $104,883,874

LIABILITIES
Payable to First Investors Life Insurance Company ......... 2,498,974
------------

NET ASSETS .................................................... $102,384,900

Net assets represented by Contracts ........................... $102,384,900
============

STATEMENT OF OPERATIONS

Year ended December 31, 1995

INVESTMENT INCOME
Income:
Dividends ................................................. $ 4,741,828
------------

Total income .......................................... 4,741,828
------------

Expenses:
Cost of insurance charges (Note 4) ........................ 2,536,392
Mortality and expense risks (Note 4) ...................... 453,172
------------

Total expenses ........................................ 2,989,564
------------

NET INVESTMENT INCOME ......................................... 1,752,264
------------

UNREALIZED APPRECIATION ON INVESTMENTS
Beginning of year ........................................... 5,684,606
End of year ................................................. 19,645,118
------------

Change in unrealized appreciation on investments .............. 13,960,512
------------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS .......... $ 15,712,776
============

See notes to financial statements.

<PAGE>

FIRST INVESTORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE

STATEMENTS OF CHANGES IN NET ASSETS

Years ended December 31,
<TABLE>
<CAPTION>
1995 1994
------------- ------------
<S> <C> <C>
Increase (Decrease) in Net Assets
From Operations
Net investment income (loss) .................................. $ 1,752,264 $ (930,887)
Change in unrealized appreciation on investments .............. 13,960,512 (2,920,992)
------------- ------------

Net increase (decrease) in net assets resulting from operations 15,712,776 (3,851,879)
------------- ------------

From Unit Transactions
Net insurance premiums ........................................ 23,709,341 20,555,397
Contract payments ............................................. (9,408,404) (8,253,343)
------------- ------------

Net increase in net assets derived from unit transactions ..... 14,300,937 12,302,054
------------- ------------

Net increase in net assets .................................... 30,013,713 8,450,175

Net Assets
Beginning of year ............................................... 72,371,187 63,921,012
------------- ------------
End of year ..................................................... $ 102,384,900 $ 72,371,187
============= ============
</TABLE>

See notes to financial statements.

<PAGE>

FIRST INVETORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE

NOTES TO FINANCIAL STATEMENTS
December 31, 1995

Note 1 -- Organization

First Investors Life Level Premium Variable Life Insurance (Separate
Account B), a unit investment trust registered under the Investment Company Act
of 1940 (the 1940 Act), is a segregated investment account established by First
Investors Life Insurance Company (FIL). Assets of the Separate Account B have
been used to purchase shares of First Investors Life Series Fund (The Fund), an
open-end diversified management investment company registered under the 1940
Act. Note 2 -- Significant Accounting Policies

INVESTMENTS

Shares of the Fund held by Separate Account B are valued at net asset
value per share. All distributions received from the Fund are reinvested
to purchase additional shares of the Fund at net asset value.

NET ASSETS REPRESENTED BY CONTRACTS

The net assets represented by contracts represents the cash value of
the policyholder accounts which is the estimated liability for future
policy benefits. The liability for future policy benefits is computed
based upon assumptions as to anticipated mortality, withdrawals and
investment yields. The mortality assumption is based upon the 1975-80
Basic Select plus Ultimate mortality table. F

EDERAL INCOME TAXES

Separate Account B is not taxed separately because its operations are
part of the total operations of FIL, which is taxed as a life insurance
company under the Internal Revenue Code. Separate Account B will not be
taxed as a regulated investment company under Subchapter M of the Code.
Under existing Federal income tax law, no taxes are payable on the
investment income or on the capital gains of Separate Account B.

Note 3 -- Investments

Investments consist of the following:

<TABLE>
<CAPTION>
Net Asset Market
Shares Value Value Cost
------ ----- ----- ----
<S> <C> <C> <C> <C>
First Investors Life
Series Fund
Cash Management.................................. 1,196,086 $ 1.00 $ 1,196,083 $ 1,196,083
High Yield....................................... 2,451,115 11.57 28,361,179 26,108,046
Growth........................................... 848,602 20.47 17,374,997 13,260,442
Discovery........................................ 767,001 23.27 17,846,679 13,920,311
Blue Chip........................................ 1,129,035 16.98 19,169,491 14,174,034
International Securities......................... 1,092,304 15.58 17,018,029 13,087,775
Government....................................... 69,276 10.52 728,569 704,884
Investment Grade................................. 152,649 11.73 1,794,254 1,623,546
Utility Income................................... 118,831 11.74 1,394,593 1,163,635
------------ -----------
$104,883,874 $85,238,756
============ ===========
</TABLE>

The High Yield Series' investments in high yield securities whether rated or
unrated may be considered speculative and subject to greater market fluctuations
and risks of loss of income and principal than lower yielding, higher rated,
fixed income securities.

Note 4 -- Mortality and Expense Risks and Deductions

In consideration for its assumption of the mortality and expense risks
connected with the Variable Life Contracts, FIL deducts an amount equal on an
annual basis to .50% of the daily net asset value of Separate Account B. The
deduction for the year ended December 31, 1995 was $453,172.

A monthly charge is also made to Separate Account B for the cost of insurance
protection. This amount varies with the age and sex of the insured and the net
amount of insurance at risk. For further discussion, see "Cost of Insurance
Protection" in the Prospectus. For the year ended December 31, 1995 cost of
insurance charges amounted to $2,536,392.

<PAGE>

First Investors Life
Level Premium
Variable Life
Insurance
(Separate Account B)
- ---------------------------

Prospectus

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

April 29, 1996

First Investors Logo

Logo is described as follows: the arabic numeral one separated
into seven vertical segments followed by the words "First
Investors."

Verticle line from top to bottom in center of page about 1/2 inch
in thickness

To the left of the verticle line is the following language:

TABLE OF CONTENTS
- -------------------------------------

General Description................................ 2
Charges and Expenses............................... 6
The Variable Life Policy........................... 8
Illustrations of Death Benefits,
Cash Values and Accumulated Premiums.............. 17
Federal Income Tax Status.......................... 22
Voting Rights...................................... 23
Officers and Directors of
First Investors Life Insurance Company............ 24
Distribution of Policies........................... 25
Custodian.......................................... 26
Reports............................................ 26
State Regulation................................... 26
Experts............................................ 26
Relevance of Financial Statements.................. 27
Appendisx I -- Other Policy Provisions............. 27
Appendis II -- Additional Illustrations of Death
Benefits, Cash Values and
Accumulated Premiums.............................. 29
Financial Statements of First Investors Life....... 33
Financial Statements of Separate Account B......... 46

<PAGE>

First Investors Life Series Fund

95 Wall Street, New York, New York 10005/(212) 858-8200

This is a Prospectus for First Investors Life Series Fund ("Life Series
Fund"), an open-end, diversified management investment company. The Fund offers
eleven separate investment series, each of which has different investment
objectives and policies: First Investors Life Blue Chip Fund ("Blue Chip Fund"),
First Investors Life Cash Management Fund ("Cash Management Fund"), First
Investors Life Discovery Fund ("Discovery Fund"), First Investors Life
Government Fund ("Government Fund"), First Investors Life Growth Fund ("Growth
Fund"), First Investors Life High Yield Fund ("High Yield Fund"), First
Investors Life International Securities Fund ("International Securities Fund"),
First Investors Life Investment Grade Fund ("Investment Grade Fund"), First
Investors Life Target Maturity 2007 Fund ("Target Maturity 2007 Fund"), First
Investors Life Target Maturity 2010 Fund ("Target Maturity 2010 Fund") and First
Investors Life Utilities Income Fund ("Untilities Income Fund") (each, a Fund,
and collectively, "Funds"). Each Fund's investment objectives are listed on the
inside cover.

Investments in a Fund are only available through purchases of the Level
Premium Variable Life Insurance Policies ("Policies") or the Individual Variable
Annuity Contracts ("Contracts") offered by First Investors Life Insurance
Company ("First Investors Life"). Policy premiums, net of certain expenses, are
paid into a unit investment trust, First Investors Life Insurance Company
Separate Account B ("Separate Account B"). Purchase payments for the Contracts,
net of certain expenses, are also paid into a unit investment trust, First
Investors Life Variable Annuity Fund C ("Separate Account C"). Separate Account
B and Separate Account C ("Separate Accounts") pool these proceeds to purchase
shares of a Fund designated by purchasers of the Policies or Contracts.
Investments in a Fund are used to fund benefits under the Policies and
Contracts. Target Maturity 2007 Fund and Target Maturity 2010 Fund are only
offered to Contractowners of Separate Account C.

An investment in Life Series Fund, including Cash Management Fund, is
neither insured nor guaranteed by the U.S. Government. There can be no assurance
that the Cash Management Fund will be able to maintain a stable net asset value
of $1.00 per share. Investments by the High Yield Fund in high-yield, high risk
securities, commonly referred to as "junk bonds," may entail risks that are
different or more pronounced than those that would result from investment in
higher-rated securities. See "High Yield Securities--Risk Factors."

This Prospectus sets forth concisely the information about the Funds that a
prospective investor should know before investing and should be retained for
future reference. First Investors Management Company, Inc. ("FIMCO" or
"Adviser") serves as investment adviser to the Funds. A Statement of Additional
Information ("SAI"), dated April 29, 1996 (which is incorporated by reference
herein), has been filed with the Securities and Exchange Commission. The SAI is
available at no charge upon request to the Funds at the address or telephone
number indicated above.

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

An investment in these securities is not a deposit or obligation of, or
guaranteed or endorsed by, any bank and is not federally insured or protected by
the Federal Deposit Insurance Corporation, the Federal Reserve Board or any
other governmental agency.

The date of this Prospectus is April 29, 1996

<PAGE>

The investment objectives of each Fund of Life Series Fund offered by this
Prospectus are as follows:

Blue Chip Fund. The investment objective of the Fund is to seek high total
investment return consistent with the preservation of capital. This goal will be
sought by investing, under normal market conditions, primarily in equity
securities of larger, well-capitalized companies with high potential earnings
growth that have shown a history of dividend payments, commonly known as "Blue
Chip" companies.

Cash Management Fund. The objective of the Fund is to seek to earn a high
rate of current income consistent with the preservation of capital and
maintenance of liquidity. The Fund will invest in money market obligations,
including high quality securities issued or guaranteed by the U.S. Government or
its agencies and instrumentalities, bank obligations and high grade corporate
instruments.

Discovery Fund. The investment objective of the Fund is to seek long-term
capital appreciation, without regard to dividend or interest income, through
investment in the common stock of companies with small to medium market
capitalization that the Adviser considers to be undervalued or less well known
in the current marketplace and to have the potential for capital growth.

Government Fund. The investment objective of the Fund is to seek to achieve
a significant level of current income which is consistent with security and
liquidity of principal by investing, under normal market conditions, primarily
in obligations issued or guaranteed as to principal and interest by the U.S.
Government, its agencies or instrumentalities, including mortgage-backed
securities.

Growth Fund. The investment objective of the Fund is to seek long-term
capital appreciation. This goal will be sought by investing, under normal market
conditions, primarily in common stocks of companies and industries selected for
their growth potential.

High Yield Fund. The primary objective of the Fund is to seek to earn a
high level of current income. The Fund actively seeks to achieve its secondary
objective of capital appreciation to the extent consistent with its primary
objective. The Fund seeks to attain its objectives primarily through investments
in lower-grade, high-yielding, high risk debt securities, commonly referred to
as "junk bonds" ("High Yield Securities").

International Securities Fund. The primary objective of the Fund is to seek
long-term capital growth. As a secondary objective, the Fund seeks to earn a
reasonable level of current income. These objectives are sought, under normal
market conditions, through investment in common stocks, rights and warrants,
preferred stocks, bonds and other debt obligations issued by companies or
governments of any nation, subject to certain restrictions with respect to
concentration and diversification.

Investment Grade Fund. The investment objective of the Fund is to seek a
maximum level of income consistent with investment in investment grade debt
securities.

Target Maturity 2007 Fund. The investment objective of the Fund is to seek
a predictable compounded investment return for investors who hold their Fund
shares until the Fund's maturity, consistent with preservation of capital. The
Fund intends to terminate in the year 2007.

<PAGE>

Target Maturity 2010 Fund. The investment objective of the Fund is to seek
a predictable compounded investment return for investors who hold their Fund
shares until the Fund's maturity, consistent with preservation of capital. The
Fund intends to terminate in the year 2010.

Target Maturity 2007 Fund and Target Maturity 2010 Fund each will seek its
objective by investing, under normal market conditions, at least 65% of its
total assets in zero coupon securities which are issued by the U.S. Government,
its agencies or instrumentalities or created by third parties using securities
issued by the U.S. Government, its agencies or instrumentalities.

As a result of the volatile nature of the market for zero coupon
securities, the value of shares of Target Maturity 2007 Fund and Target Maturity
2010 Fund prior to each Fund's maturity may fluctuate significantly. Thus, to
achieve a predictable return, investors should hold their investments in either
of these two Funds until the Fund liquidates since the Fund's value changes
daily with market conditions. Accordingly, any investor who redeems his or her
shares prior to a Fund's maturity is likely to achieve a different investment
result than the return that was predicted on the date the investment was made,
and may even suffer a significant loss.

Utilities Income Fund. The primary investment objective of the Fund is to
seek high current income. Long-term capital appreciation is a secondary
objective. These objectives are sought, under normal market conditions, through
investment in equity and debt securities issued by companies primarily engaged
in the public utilities industry.

There can be no assurance that any Fund will achieve its investment
objectives. See "Investment Objectives and Policies" for a detailed description
of each Fund's investment objectives and policies.

<PAGE>

FINANCIAL HIGHLIGHTS

The following table sets forth the per share operating performance data for
a share outstanding, total return, ratios to average net assets and other
supplemental data for each period indicated. Financial highlights are not
presented for Target Maturity 2010 Fund since the Fund did not commence
operations until April 1996. The table below has been derived from financial
statements which have been examined by Tait, Weller & Baker, independent
certified public accountants, whose report thereon appears in the Statement of
Additional Information ("SAI"). This information should be read in conjunction
with the Financial Statements and Notes thereto, which also appear in the SAI,
available at no charge upon request to the Funds.

<TABLE>
<CAPTION>
PER SHARE DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations Less Distributions from
------------------------------------- -----------------------
Net Asset Value Net Realized
--------------- Net and Unrealized Total from Net Net Net Asset Value
Beginning of Investment Gain (Loss) Investment Investment Realized Total ---------------
Period Income on Investments Operations Income Gains Distributions End of Period
- ------------------------------------------------------------------------------------------------------------------------------------
Blue Chip
- ---------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
3/8/90* to 12/31/90 ...... $10.00 $.07 $(.02) $ .$5 -- $ -- $ -- $10.05
1991 ..................... 10.05 .12 2.50 2.62 .05 -- .05 12.62
1992 ..................... 12.62 .16 .67 .83 .21 -- .21 13.24
1993 ..................... 13.24 .15 .97 1.12 .15 -- .15 14.21
1994 ..................... 14.21 .18 (.39) (.21) .08 .17 .25 13.75
1995 ..................... 13.75 .26 4.11 4.37 .19 .95 1.14 16.98
Cash Management**
- ---------------
1988 ..................... 1.00 .048 -- .048 .048 -- .048 1.00
1989 ..................... 1.00 .075 -- .075 .075 -- .075 1.00
1990 ..................... 1.00 .072 -- .072 .072 -- .072 1.00
1991 ..................... 1.00 .054 -- .054 .054 -- .054 1.00
1992 ..................... 1.00 .029 -- .029 .029 -- .029 1.00
1993 ..................... 1.00 .027 -- .027 .027 -- .027 1.00
1994 ..................... 1.00 .037 -- .037 .037 -- .037 1.00
1995 ..................... 1.00 .054 -- .054 .054 -- .054 1.00
Discovery
- ---------
1988 ..................... 10.02 .26 .10 .36 -- -- -- 10.38
1989 ..................... 10.38 .19 2.19 2.38 .27 .09 .36 12.40
1990 ..................... 12.40 .14 (.78) (.64) .15 .90 1.05 10.71
1991 ..................... 10.71 .07 5.42 5.49 .18 -- .18 16.02
1992 ..................... 16.02 -- 2.51 2.51 .03 .15 .18 18.35
1993 ..................... 18.35 -- 3.92 3.92 -- .91 .91 21.36
1994 ..................... 21.36 .06 (.62) (.56) -- .94 .94 19.86
1995 ..................... 19.86 .11 4.62 4.73 .06 1.26 1.32 23.27
Government
- ----------
1/7/92* to 12/31/92 ...... 10.00 .47 .51 .98 .33 -- .33 10.65
1993 ..................... 10.65 .64 .02 .66 .70 .19 .89 10.42
1994 ..................... 10.42 .79 (1.21) (.42) .25 .05 .30 9.70
1995 ..................... 9.70 .66 .78 1.44 .62 -- .62 10.52
</TABLE>

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

* Commencement of operations
** Adjusted to reflect ten-for-one stock split on May 1, 1991.
+ Some or all expenses have been waived or assumed by the investment adviser
from commencement of operations through December 31, 1995.
++ The effect of fees and charges incurred at the separate account level are
not reflected in these performance figures.
(a) Annualized

<PAGE>

<TABLE>
<CAPTION>
RATIOS / SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio to Average Net Assets
Ratio to Average Net Assets+ Before Expenses Waived or Assumed
Net Assets ----------------------------- --------------------------------- Portfolio
Total End of Period Net Investment Net Investment Turnover
Return++(%) (in thousands) Expenses+(%) Income(%) Expenses(%) Income(%) Rate(%)
- ------------------------------------------------------------------------------------------------------------------------------------
Blue Chip
- ---------
<C> <C> <C> <C> <C> <C> <C> <C>
3/8/90* to 12/31/90 ...... .61(a) $3,656 -- 2.95(a) 1.92(a) 1.03(a) 15
1991 ..................... 26.17 13,142 1.00 1.88 1.55 1.34 21
1992 ..................... 6.67 23,765 .79 1.66 .86 1.60 40
1993 ..................... 8.51 34,030 .88 1.27 N/A N/A 37
1994 ..................... (1.45) 41,424 .88 1.49 N/A N/A 82
1995 ..................... 34.00 66,900 .86 1.89 N/A N/A 26
Cash Management**
- ---------------
1988 ..................... 4.94 33 -- 4.99 7.68 (2.69) N/A
1989 ..................... 7.79 2,210 -- 7.84 1.35 6.49 N/A
1990 ..................... 7.49 8,203 .39 6.90 1.15 6.15 N/A
1991 ..................... 5.71 9,719 .57 5.39 .93 5.03 N/A
1992 ..................... 3.02 8,341 .79 2.99 .98 2.81 N/A
1993 ..................... 2.70 4,243 .60 2.67 1.05 2.22 N/A
1994 ..................... 3.77 3,929 .60 3.69 1.04 3.25 N/A
1995 ..................... 5.51 4,162 .61 5.36 1.10 4.87 N/A
Discovery
- ---------
1988 ..................... 3.59 125 -- 3.80 3.10 .70 158
1989 ..................... 23.62 283 -- 2.43 4.78 (2.35) 231
1990 ..................... (5.47) 960 -- 2.97 2.68 .28 104
1991 ..................... 51.73 4,661 .70 .48 1.49 (.31) 93
1992 ..................... 15.74 10,527 .91 .02 1.05 (.12) 91
1993 ..................... 22.20 21,221 .87 (.03) N/A N/A 69
1994 ..................... (2.53) 30,244 .88 .36 N/A N/A 53
1995 ..................... 25.23 50,900 .87 .60 N/A N/A 78
Government
- ----------
1/7/92* to 12/31/92 ...... 9.95(a) 5,064 .03(a) 6.64(a) .89(a) 5.79(a) 301
1993 ..................... 6.35 8,234 .35 6.60 .84 6.11 525
1994 ..................... (4.10) 7,878 .35 6.74 .90 6.19 457
1995 ..................... 15.63 9,500 .40 6.73 .93 6.21 198
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
PER SHARE DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations Less Distributions from
------------------------------------- -----------------------
Net Asset Value Net Realized
--------------- Net and Unrealized Total from Net Net Net Asset Value
Beginning of Investment Gain (Loss) Investment Investment Realized Total ---------------
Period Income on Investments Operations Income Gains Distributions End of Period
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Growth
- ------
1988........................ $10.02 $ .26 $ .51 $ .77 $ -- $ -- $ -- $10.79
1989........................ 10.79 .02 2.51 2.53 .18 .12 .30 13.02
1990........................ 13.02 .16 (.55) (.39) .06 -- .06 12.57
1991........................ 12.57 .17 4.15 4.32 .18 -- .18 16.71
1992........................ 16.71 .08 1.41 1.49 .18 1.38 1.56 16.64
1993........................ 16.64 .07 .93 1.00 .09 .10 .19 17.45
1994........................ 17.45 .09 (.60) (.51) -- .21 .21 16.73
1995........................ 16.73 .18 3.94 4.12 .09 .29 .38 20.47
High Yield
- ----------
1988........................ 10.00 .74 .82 1.56 -- -- -- 11.56
1989........................ 11.56 .74 (.92) (.18) .56 .11 .67 10.71
1990........................ 10.71 1.08 (1.79) (.71) .83 -- .83 9.17
1991........................ 9.17 1.16 1.66 2.82 1.18 -- 1.18 10.81
1992........................ 10.81 1.11 .21 1.32 1.69 -- 1.69 10.44
1993........................ 10.44 .96 .88 1.84 1.12 -- 1.12 11.16
1994........................ 11.16 .87 (1.14) (.27) .31 -- .31 10.58
1995........................ 10.58 1.00 .95 1.95 .96 -- .96 11.57
International Securities
- ------------------------
4/16/90* to 12/31/90........ 10.00 .03 .34 .37 -- -- -- 10.37
1991........................ 10.37 .09 1.49 1.58 .03 .05 .08 11.87
1992........................ 11.87 .15 (.28) (.13) .15 .22 .37 11.37
1993........................ 11.37 .10 2.41 2.51 .14 -- .14 13.74
1994........................ 13.74 .14 (.32) (.18) .05 -- .05 13.51
1995........................ 13.51 .19 2.25 2.44 .12 .25 .37 15.58
Investment Grade
- ----------------
1/7/92* to 12/31/92......... 10.00 .43 .44 .87 .34 -- .34 10.53
1993........................ 10.53 .65 .49 1.14 .71 .01 .72 10.95
1994........................ 10.95 .67 (1.06) (.39) .16 .09 .25 10.31
1995........................ 10.31 .67 1.28 1.95 .53 -- .53 11.73
Target Maturity 2007
- --------------------
4/26/95* to 12/31/95 10.00 .26 2.00 2.26 -- -- -- 12.26
Utilities Income
- ----------------
11/15/93* to 12/31/93....... 10.00 .01 (.07) (.06) -- -- -- 9.94
1994........................ 9.94 .24 (.96) (.72) .03 -- .03 9.19
1995........................ 9.19 .28 2.46 2.74 .19 -- .19 11.74
</TABLE>
- ----------
* Commencement of operations
+ Some or all expenses have been waived or assumed by the investment adviser
from commencement of operations through Dec. 31, 1995.
++ The effect of fees and charges incurred at the separate account level are
not reflected in these performance figures.
(a) Annualized

<PAGE>

<TABLE>
<CAPTION>
RATIOS / SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio to Average Net Assets
Ratio to Average Net Assets+ Before Expenses Waived or Assumed
Net Assets ----------------------------- --------------------------------- Portfolio
Total End of Period Net Investment Net Investment Turnover
Return++(%) (in thousands) Expenses+(%) Income(%) Expenses(%) Income(%) Rate(%)
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
Growth
- ------
1988........................ 7.68 $ 38 -- 3.20 8.70 (5.50) 31
1989........................ 24.00 570 -- 2.91 5.21 (2.30) 24
1990........................ (2.99) 2,366 -- 3.03 1.64 1.40 28
1991........................ 34.68 7,743 .69 1.21 1.34 .55 148
1992........................ 9.78 16,385 .76 .75 1.20 .30 45
1993........................ 6.00 25,658 .91 .43 N/A N/A 51
1994........................ (2.87) 32,797 .90 .60 N/A N/A 40
1995........................ 25.12 51,171 .88 1.10 N/A N/A 64
High Yield
- ----------
1988........................ 15.60 4,565 -- 13.22 1.32 11.90 46
1989........................ (1.76) 14,354 -- 12.05 .88 11.17 22
1990........................ (5.77) 18,331 -- 13.21 .91 12.30 35
1991........................ 33.96 23,634 .53 11.95 .89 11.60 40
1992........................ 13.15 24,540 .91 10.48 .96 10.43 84
1993........................ 18.16 30,593 .91 9.49 N/A N/A 96
1994........................ (1.56) 32,285 .88 9.43 N/A N/A 50
1995........................ 19.82 41,894 .87 9.83 N/A N/A 57
International Securities
- ------------------------
4/16/90* to 12/31/90........ 5.21(a) 3,946 -- .99(a) 3.43(a) (2.43)(a) 29
1991........................ 15.24 8,653 1.70 .75 2.27 .18 70
1992........................ (1.13) 12,246 1.03 1.55 1.38 1.20 36
1993........................ 22.17 21,009 1.14 .97 N/A N/A 37
1994........................ (1.29) 31,308 1.03 1.22 N/A N/A 36
1995........................ 18.70 41,012 1.02 1.42 N/A N/A 45
Investment Grade
- ----------------
1/7/92* to 12/31/92......... 8.91(a) 4,707 .23(a) 6.16(a) .93(a) 5.46(a) 72
1993........................ 10.93 10,210 .35 6.32 .85 5.82 64
1994........................ (3.53) 11,602 .37 6.61 .92 6.06 15
1995........................ 19.69 16,262 .51 6.77 .91 6.37 26
Target Maturity 2007
- --------------------
4/26/95* to 12/31/95 22.60 9,860 .04(a) 6.21(a) .87(a) 5.38(a) 28
Utilities Income
- ----------------
11/15/93* to 12/31/93....... (4.66)(a) 494 -- 1.46(a) 3.99(a) (2.52)(a) 0
1994........................ (7.24) 4,720 .17 4.13 .95 3.35 31
1995........................ 30.26 14,698 .41 4.16 .91 3.67 17
</TABLE>

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES

Blue Chip Fund

Blue Chip Fund seeks to provide investors with high total investment return
consistent with the preservation of capital. The Fund seeks to achieve its
objective by investing, under normal market conditions, at least 65% of its
total assets in equity securities of "Blue Chip" companies, including common and
preferred stocks and securities convertible into common stock, that the Adviser
believes have potential earnings growth that is greater than the average company
included in the Standard & Poor's 500 Composite Stock Price Index ("S&P 500").
The Fund also may invest up to 35% of its total assets in the equity securities
of non-Blue Chip companies that the Adviser believes have significant potential
for growth of capital or future income consistent with the preservation of
capital. When market conditions warrant, or when the Adviser believes it is
necessary to achieve the Fund's objective, the Fund may invest up to 25% of its
total assets in fixed income securities.

The Fund defines Blue Chip companies as those companies that have a market
capitalization of at least $300 million, are dividend paying and are included in
the S&P 500. Market capitalization is the total market value of a company's
outstanding common stock. Blue Chip companies are considered to be of relatively
high quality and generally exhibit superior fundamental characteristics, which
may include: potential for consistent earnings growth, a history of
profitability and payment of dividends, leadership position in their industries
and markets, proprietary products or services, experienced management, high
return on equity and a strong balance sheet. Blue Chip companies usually exhibit
less investment risk and share price volatility than smaller, less established
companies. Examples of Blue Chip companies are American Telephone & Telegraph,
General Electric, Pepsico Inc. and Bristol-Myers Squibb.

The fixed income securities in which the Fund may invest include money
market instruments (including prime commercial paper, certificates of deposit of
domestic branches of U.S. banks and bankers' acceptances), obligations issued or
guaranteed as to principal and interest by the U.S. Government, its agencies or
instrumentalities ("U.S. Government Obligations"), including mortgage-backed
securities, and corporate debt securities. However, no more than 5% of the
Fund's net assets may be invested in corporate debt securities rated below Baa
by Moody's Investors Service, Inc. ("Moody's") or BBB by Standard & Poor's
Ratings Group ("S&P"). The Fund may borrow money for temporary or emergency
purposes in amounts not exceeding 5% of its total assets. The Fund may also
invest up to 5% of its net assets in American Depository Receipts ("ADRs"),
enter into repurchase agreements and make loans of portfolio securities. See
"Description of Certain Securities, Other Investment Policies and Risk Factors,"
below, and the SAI for additional information concerning these securities.

Cash Management Fund

Cash Management Fund seeks to earn a high rate of current income consistent
with the preservation of capital and maintenance of liquidity. The Fund
generally can invest only in securities that mature within 397 days from the
date of purchase. In addition, the Fund maintains a dollar-weighted average
portfolio maturity of 90 days or less.

<PAGE>

Cash Management Fund invests primarily in (1) high quality marketable
securities issued or guaranteed as to principal and interest by the U.S.
Government, its agencies or instrumentalities, (2) bank certificates of deposit,
bankers' acceptances, time deposits and other short-term obligations issued by
banks and (3) prime commercial paper and high quality, U.S. dollar denominated
short-term corporate bonds and notes. The U.S. Government securities in which
the Fund may invest include a variety of U.S. Treasury securities that differ in
their interest rates, maturities and dates of issue. Securities issued or
guaranteed by agencies or instrumentalities of the U.S. Government may be
supported by the full faith and credit of the United States or by the right of
the issuer to borrow from the U.S. Treasury. See the SAI for additional
information on U.S. Government securities. The Fund may invest in domestic bank
certificates of deposit (insured up to $100,000) and bankers' acceptances (not
insured) issued by domestic banks and savings institutions which are insured by
the Federal Deposit Insurance Corporation ("FDIC") and that have total assets
exceeding $500 million. The Fund also may invest in certificates of deposit
issued by London branches of domestic or foreign banks ("Eurodollar CDs"). The
Fund may invest in time deposits and other short-term obligations, including
uninsured, direct obligations bearing fixed, floating or variable interest
rates, issued by domestic banks, foreign branches of domestic banks, foreign
subsidiaries of domestic banks and domestic and foreign branches of foreign
banks. See Appendix A to the SAI for a description of commercial paper ratings
and Appendix B to the SAI for a description of municipal note ratings. The Fund
also may invest in repurchase agreements with banks that are members of the
Federal Reserve System or securities dealers that are members of a national
securities exchange or are market makers in U.S. Government securities, and, in
either case, only where the debt instrument subject to the repurchase agreement
is a U.S. Treasury or agency obligation.

Cash Management Fund also may purchase high quality, U.S. dollar
denominated short-term bonds and notes, including variable rate and master
demand notes issued by domestic and foreign corporations (including banks).
Floating and variable rate demand notes and bonds permit the Fund, as the
holder, to demand payment of principal at any time, or at specified intervals
not exceeding 397 days, in each case upon not more than 30 days' notice. The
Fund may borrow money for temporary or emergency purposes in amounts not
exceeding 5% of its total assets and make loans of portfolio securities. See
"Description of Certain Securities, Other Investment Policies and Risk Factors"
for additional information concerning these securities.

Cash Management Fund may purchase only obligations that (1) the Adviser
determines present minimal credit risks based on procedures adopted by Life
Series Fund's Board of Trustees, and (2) are either (a) rated in one of the top
two rating categories by at least two nationally recognized statistical ratings
organizations ("NRSROs") (or one, if only one rated the security) or (b) unrated
securities that the Adviser determines are of comparable quality. Securities
qualify as being in the top rating category ("First Tier Securities") if at
least two NRSROs (or one, if only one rated the security) have given it the
highest rating. If only one NRSRO has rated a security, or it is unrated, the
acquisition of that security must be approved or ratified by Life Series Fund's
Board of Trustees. The Fund's purchases of commercial paper are limited to First
Tier Securities. The Fund may not invest more than 5% of its total assets in
securities rated in the second highest rating category ("Second Tier
Securities"). Investments in Second Tier Securities of any one issuer are
limited to the greater of 1% of the Fund's total assets or $1 million. The Fund
generally may invest no more than 5% of its total assets in the securities of a
single issuer (other than securities issued by the U.S. Government, its agencies
or instrumentalities).

<PAGE>

Discovery Fund

Discovery Fund seeks long-term capital appreciation, without regard to
dividend or interest income. The Fund seeks to achieve its objective by
investing in the common stock of companies with small to medium market
capitalization that the Adviser considers to be undervalued or less well known
in the current marketplace and to have potential for capital growth.

The Fund seeks to invest in the common stock of companies that are
undervalued in the current market in relation to fundamental economic values
such as earnings, sales, cash flow and tangible book value; that are early in
their corporate development (i.e., before they become widely recognized and well
known and while their reputations and track records are still emerging); or that
offer the possibility of greater earnings because of revitalized management, new
products or structural changes in the economy. Such companies primarily are
those with small to medium market capitalization, which the Adviser currently
considers to be market capitalization of up to $1.5 billion, but which could be
higher under certain market conditions. The Adviser believes that, over time,
these securities are more likely to appreciate in price than securities whose
market prices have already reached their perceived economic value. In addition,
the Fund intends to diversify its holdings among as many companies and
industries as the Adviser deems appropriate.

Companies that are early in their corporate development may be dependent on
relatively few products or services, may lack adequate capital reserves, may be
dependent on one or two management individuals and may have less of a track
record or historical pattern of performance. In addition, there may be less
information available as to the issuers and their securities may not be well
known to the general public and may not yet have wide institutional ownership.
Thus, the investment risk is higher than that normally associated with larger,
older or better-known companies.

Investments in securities of companies with small to medium market
capitalization are generally considered to offer greater opportunity for
appreciation and to involve greater risk of depreciation than securities of
companies with larger market capitalization. Because the securities of most
companies with small to medium market capitalization are not as broadly traded
as those of companies with larger market capitalization, these securities are
often subject to wider and more abrupt fluctuations in market price. In the
past, there have been prolonged periods when these securities have substantially
underperformed or outperformed the securities of larger capitalization
companies. In addition, smaller capitalization companies generally have fewer
assets available to cushion an unforeseen adverse occurrence and thus such an
occurrence may have a disproportionately negative impact on these companies.

The Fund may invest up to 10% of its total assets in common stocks issued
by foreign companies which are traded on a recognized domestic or foreign
securities exchange. In addition to the fundamental analysis of companies and
their industries which it performs for U.S. issuers, the Adviser evaluates the
economic and political climate of the country in which the company is located
and the principal securities markets in which such securities are traded.
Although the foreign stocks in which the Fund invests are primarily denominated
in foreign currencies, the Fund also may invest in ADRs. The Adviser does not
attempt to time actively either short-term market trends or short-term currency
trends in any market. See "Foreign Securities--Risk Factors" and "American
Depository Receipts and Global Depository Receipts."

<PAGE>

The Fund may borrow money for temporary or emergency purposes in amounts
not exceeding 5% of its total assets. The Fund also may enter into repurchase
agreements and may make loans of portfolio securities. For temporary defensive
purposes, the Fund may invest all of its assets in U.S. Government Obligations,
prime commercial paper, certificates of deposit and bankers' acceptances. See
the SAI for more information regarding these securities.

Government Fund

Government Fund seeks to achieve a significant level of current income
which is consistent with security and liquidity of principal by investing, under
normal market conditions, at least 65% of its assets in U.S. Government
Obligations, including mortgage-backed securities. Securities issued or
guaranteed as to principal and interest by the U.S. Government include a variety
of Treasury securities, which differ only in their interest rates, maturities
and times of issuance. Although the payment of interest and principal on a
portfolio security may be guaranteed by the U.S. Government or one of its
agencies or instrumentalities, shares of the Fund are not insured or guaranteed
by the U.S. Government or any agency or instrumentality. The net asset value of
shares of the Fund generally will fluctuate in response to interest rate levels.
When interest rates rise, prices of fixed income securities generally decline;
when interest rates decline, prices of fixed income securities generally rise.
See "U.S. Government Obligations" and "Debt Securities-Risk Factors," below.

The Fund may invest in mortgage-backed securities, including those
involving Government National Mortgage Association ("GNMA") certificates,
Federal National Mortgage Association ("FNMA") certificates and Federal Home
Loan Mortgage Corporation ("FHLMC") certificates. The Fund also may invest in
securities issued or guaranteed by other U.S. Government agencies or
instrumentalities, including: the Federal Farm Credit System and the Federal
Home Loan Bank (each of which may not borrow from the U.S. Treasury and the
securities of which are not guaranteed by the U.S. Government); the Tennessee
Valley Authority, and the U.S. Postal Service (each of which may borrow from the
U.S. Treasury to meet its obligations); the Farmers Home Administration and the
Export-Import Bank (the securities of which are backed by the full faith and
credit of the United States). The Fund normally reinvests principal payments
(whether regular or pre-paid) in additional mortgage-backed securities. See
"Mortgage-Backed Securities," below.

The Fund may invest up to 35% of its assets in securities other than U.S.
Government Obligations and mortgage-backed securities. These may include: prime
commercial paper, certificates of deposit of domestic branches of U.S. banks,
bankers' acceptances, repurchase agreements (applicable to U.S. Government
Obligations), insured certificates of deposit and certificates representing
accrual on U.S. Treasury securities. The Fund also may make loans of portfolio
securities and invest in zero coupon securities. The Fund may borrow money for
temporary or emergency purposes in amounts not exceeding 5% of its total assets.
See the SAI for a further discussion of these securities.

For temporary defensive purposes, the Fund may invest all of its assets in
cash, cash equivalents and money market instruments, including bank certificates
of deposit, bankers' acceptances and commercial paper issued by domestic
corporations, short-term fixed income securities or U.S. Government Obligations.
See the SAI for a description of these securities.

<PAGE>

Growth Fund

The investment objective of Growth Fund is long-term capital appreciation.
Current income through the receipt of interest or dividends from investments
will merely be incidental to the Fund's efforts in pursuing its goal. It is the
policy of the Fund to invest, under normal market conditions, primarily in
common stocks and it is anticipated that the Fund will usually be so invested.
It also may invest to a limited degree in convertible securities and preferred
stocks. At least 75% of the value of the Fund's total assets (excluding
securities held for defensive purposes) shall be invested in securities of
companies in industries in which the Adviser, or the Fund's investment
subadviser, Wellington Management Company ("Subadviser" or "WMC"), believes
opportunities for capital growth exist. The Fund does not intend to concentrate
its investments in a particular industry, but it may invest up to 25% of the
value of its assets in a particular industry. The Fund may also invest in ADRs
and Global Depository Receipts ("GDRs"), purchase securities on a when-issued or
delayed delivery basis and make loans of portfolio securities. The Fund may
borrow money for temporary or emergency purposes in amounts not exceeding 5% of
its total assets. For temporary defensive purposes, the Fund may invest all of
its assets in U.S. Government Obligations, investment grade bonds, prime
commercial paper, certificates of deposit, bankers' acceptances, repurchase
agreements and participation interests. See the SAI for a description of these
securities.

High Yield Fund

High Yield Fund primarily seeks high current income and secondarily seeks
growth of capital. The Fund actively seeks to achieve its secondary objective to
the extent consistent with its primary objective. The Fund seeks to achieve its
objectives by investing, under normal market conditions, at least 65% of its
total assets in high risk, high yield securities, commonly referred to as "junk
bonds" ("High Yield Securities"). High Yield Securities include the following
instruments: fixed, variable or floating rate debt obligations (including bonds,
debentures and notes) which are rated below Baa by Moody's or below BBB by S&P,
or, if unrated, are deemed to be of comparable quality by the Adviser; preferred
stocks and dividend-paying common stocks that have yields comparable to those of
high yielding debt securities; any of the foregoing securities of companies that
are financially troubled, in default or undergoing bankruptcy or reorganization
("Deep Discount Securities"); and any securities convertible into any of the
foregoing. See "High Yield Securities-- Risk Factors" and "Deep Discount
Securities."

The Fund may invest up to 5% of its total assets in debt securities issued
by foreign governments and companies located outside the United States and
denominated in U.S. or foreign currency. The Fund may borrow money for temporary
or emergency purposes in amounts not exceeding 5% of its total assets, make
loans of portfolio securities, enter into repurchase agreements and invest in
zero coupon and pay-in-kind securities. The Fund may also invest in securities
on a "when issued" or delayed delivery basis. See "Description of Certain
Securities, Other Investment Policies and Risk Factors," below, and the SAI for
more information concerning these securities.

The Fund may invest up to 35% of its total assets in securities other than
High Yield Securities, including: dividend-paying common stocks; securities
convertible into, or exchangeable for, common stock; debt obligations of all
types (including bonds, debentures and notes) rated A or better by Moody's or
S&P; U.S. Government Obligations; warrants; and money market instruments
consisting of prime commercial paper, certificates of deposit of domestic
branches of U.S. banks, bankers' acceptances and repurchase agreements.

<PAGE>

In any period of market weakness or of uncertain market or economic
conditions, the Fund may establish a temporary defensive position to preserve
capital by having all or part of its assets invested in investment grade debt
securities or retained in cash or cash equivalents, including bank certificates
of deposit, bankers' acceptances, U.S. Government Obligations and commercial
paper issued by domestic corporations. See "Description of Certain Securities,
Other Investment Policies and Risk Factors," below.

The medium- to lower-rated, and certain of the unrated securities in which
the Fund invests tend to offer higher yields than higher-rated securities with
the same maturities because the historical financial condition of the issuers of
such securities may not be as strong as that of other issuers. Debt obligations
rated lower than Baa or BBB by Moody's or S&P, respectively, are speculative and
generally involve more risk of loss of principal and income than higher-rated
securities. Also, their yields and market value tend to fluctuate more than
higher quality securities. The greater risks and fluctuations in yield and value
occur because investors generally perceive issuers of lower-rated and unrated
securities to be less creditworthy. These risks cannot be eliminated, but may be
reduced by diversifying holdings to minimize the portfolio impact of any single
investment. In addition, fluctuations in market value does not affect the cash
income from the securities, but are reflected in the Fund's net asset value.
When interest rates rise, the net asset value of the Fund tends to decrease.
When interest rates decline, the net asset value of the Fund tends to increase.

Variable or floating rate debt obligations in which the Fund may invest
periodically adjust their interest rates to reflect changing economic
conditions. Thus, changing economic conditions specified by the terms of the
security would serve to change the interest rate and the return offered to the
investor. This reduces the effect of changing market conditions on the
security's underlying market value.

A High Yield Security may itself be convertible into or exchangeable for
equity securities, or may carry with it the right to acquire equity securities
evidenced by warrants attached to the security or acquired as part of a unit
with the security. Although the Fund invests primarily in High Yield Securities,
securities received upon conversion or exercise of warrants and securities
remaining upon the break-up of units or detachment of warrants may be retained
to permit orderly disposition, to establish a long-term holding basis for
Federal income tax purposes or to seek capital appreciation.

Because of the greater number of investment considerations involved in
investing in High Yield Securities, the achievement of the Fund's investment
objectives depends more on the Adviser's research abilities than would be the
case if the Fund were investing primarily in securities in the higher rated
categories. Because medium- to lower-rated securities generally involve greater
risks of loss of income and principal than higher-rated securities, investors
should consider carefully the relative risks associated with investments in
securities that carry medium to lower ratings or, if unrated, deemed to be of
comparable quality by the Adviser. See "High Yield Securities--Risk Factors" and
Appendix A for a description of corporate bond ratings.

The dollar weighted average of credit ratings of all bonds held by the Fund
during the 1995 fiscal year, computed on a monthly basis, is set forth below.
This information reflects the average composition of the Fund's assets during
the 1995 fiscal year and is not necessarily representative of the Fund as of the
end of its 1995 fiscal year, the current fiscal year or at any other time in the
future.

<PAGE>

Comparable Quality of
Unrated Securities to
Rated by Moody's Bonds Rated by Moody's
---------------- ----------------------
Ba 12.16% 0.73%
B 71.29 0.20
Caa 1.92 0.22
Ca 0.73 0
---- ------
Total 86.10% 1.15%

International Securities Fund

International Securities Fund primarily seeks long-term capital growth and
secondarily seeks to earn a reasonable level of current income. The Fund may
invest in all types of securities issued by companies and government
instrumentalities of any nation approved by the Trustees, subject only to
industry concentration and issuer diversification restrictions described below
and in the SAI. This investment flexibility permits the Fund to react to rapidly
changing economic conditions among countries which cause the relative
attractiveness of investments within national markets to be subject to frequent
reappraisal. It is a fundamental policy of the Fund that no more than 35% of its
total assets will be invested in securities issued by U.S. companies and U.S.
Government Obligations or cash and cash equivalents denominated in U.S.
currency. In addition, the Fund presently does not intend to invest more than
35% of its total assets in any one particular country. Further, except for
temporary defensive purposes, the Fund's assets will be invested in securities
of at least three different countries outside the United States. See "Foreign
Securities--Risk Factors". For defensive purposes, the Fund may temporarily
invest in securities issued by U.S. companies and the U.S. Government and its
agencies and instrumentalities, or cash equivalents denominated in U.S.
currency, without limitation as to amount.

The Fund may purchase securities traded on any foreign stock exchange. The
Fund may also purchase ADRs and GDRs. See "American Depository Receipts and
Global Depository Receipts," below. The Fund also may invest up to 25% of its
total assets in unlisted securities of foreign issuers; provided, however, that
no more than 15% of the value of its net assets may be invested in unlisted
securities with a limited trading market and other illiquid investments. The
investment standards for the selection of unlisted securities are the same as
those used in the purchase of securities traded on a stock exchange.

The Fund may invest in warrants, which may or may not be listed on a
recognized United States or foreign exchange. The Fund also may enter into
repurchase agreements, purchase securities on a when-issued or delayed delivery
basis and make loans of portfolio securities. The Fund also may borrow money for
temporary or emergency purposes in amounts not exceeding 5% of its total assets.
See the SAI for further information concerning these securities.

Investment Grade Fund

Investment Grade Fund seeks to generate a maximum level of income
consistent with investment in investment grade debt securities. The Fund seeks
to achieve its objective by investing, under normal market conditions, at least
65% of its total assets in debt securities of U.S. issuers that are rated in the
four highest rated categories by Moody's or S&P, or in unrated securities that
are deemed to be of comparable quality by the Adviser ("investment grade
securities"). The Fund may

<PAGE>

invest up to 35% of its total assets in U.S. Government Obligations, including
mortgage-related securities, dividend-paying common and preferred stocks,
obligations convertible into common stocks, repurchase agreements, debt
securities rated below investment grade and money market instruments. The Fund
may invest up to 5% of its net assets in corporate or government debt securities
of foreign issuers which are U.S. dollar denominated and traded in U.S. markets.
The Fund may also borrow money for temporary or emergency purposes in amounts
not exceeding 5% of its total assets. The Fund may purchase securities on a
when-issued basis, make loans of portfolio securities and invest in zero coupon
or pay-in-kind securities. See "Description of Certain Securities, Other
Investment Policies and Risk Factors," below, and the SAI for additional
information concerning these securities.

The published reports of rating services are considered by the Adviser in
selecting rated securities for the Fund's portfolio. The Adviser also relies,
among other things, on its own credit analysis, which includes a study of the
existing debt's capital structure, the issuer's ability to service debt (or to
pay dividends, if investing in common or preferred stock) and the current trend
of earnings for the issuer. Although up to 100% of the Fund's total assets can
be invested in debt securities rated at least Baa by Moody's or at least BBB by
S&P, or unrated debt securities deemed to be of comparable quality by the
Adviser, no more than 5% of the Fund's net assets may be invested in debt
securities rated lower than Baa by Moody's or BBB by S&P (including securities
that have been downgraded), or, if unrated, deemed to be of comparable quality
by the Adviser, or in any equity securities of any issuer if a majority of the
debt securities of such issuer are rated lower than Baa by Moody's or BBB by
S&P. Securities rated BBB or Baa by S&P or Moody's, respectively, are considered
to be speculative with respect to the issuer's ability to make principal and
interest payments. The Adviser continually monitors the investments in the
Fund's portfolio and carefully evaluates on a case-by-case basis whether to
dispose of or retain a debt security which has been downgraded to a rating lower
than investment grade. See "Debt Securities--Risk Factors" and Appendix A for a
description of corporate bond ratings.

For temporary defensive purposes, the Fund may invest all of its assets in
money market instruments, short-term fixed income securities or U.S. Government
Obligations. See "Description of Certain Securities, Other Investment Policies
and Risk Factors," below, and the SAI.

Target Maturity 2007 Fund
Target Maturity 2010 Fund

Target Maturity 2007 Fund seeks to provide a predictable compounded
investment return for investors who hold their Fund shares until the Fund's
maturity, consistent with preservation of capital.

Target Maturity 2010 Fund seeks to provide a predictable compounded
investment return for investors who hold their Fund shares until the Fund's
maturity consistent with the preservation of capital.

Each Fund will seek its objective by investing, under normal market
conditions, at least 65% of its total assets in zero coupon securities which are
issued by the U.S. Government and its agencies and instrumentalities or created
by third parties using securities issued by the U.S. Government and its agencies
and instrumentalities. With respect to Target Maturity 2007 Fund, these
investments will mature no later than December 31, 2007 and, with respect to
Target Maturity 2010 Fund,

<PAGE>

these investments will mature no later than December 31, 2010. December 31, 2007
and December 31, 2010 are herein collectively referred to as the "Maturity
Date." On the Maturity Date, each Fund will be converted to cash and distributed
or reinvested in another Fund of Life Series Fund at the investor's choice.

Each Fund seeks to provide investors with a positive total return at the
Maturity Date which, together with the reinvestment of all dividends and
distributions, exceeds their original investment in a Fund by a relatively
predictable amount. While the risk of fluctuation in the values of zero coupon
securities is greater when the period to maturity is longer, that risk tends to
diminish as the Maturity Date approaches. Although an investor can redeem shares
at the current net asset value at any time, any investor who redeems his or her
shares prior to the Maturity Date is likely to achieve a different investment
result than the return that was predicted on the date the investment was made,
and may even suffer a significant loss.

Zero coupon securities are debt obligations that do not entitle the holder
to any periodic payment of interest prior to maturity or a specified date when
the securities begin paying current interest. They are issued and traded at a
discount from their face amount or par value. This discount varies depending on
the time remaining until maturity, prevailing interest rates, liquidity of the
security and the perceived credit quality of the issuer. When held to maturity,
the entire return of a zero coupon security, which consists of the accretion of
the discount, comes from the difference between its issue price and its maturity
value. This difference is known at the time of purchase, so investors holding
zero coupon securities until maturity know the amount of their investment return
at the time of their investment. The market values are subject to greater market
fluctuations from changing interest rates prior to maturity than the values of
debt obligations of comparable maturities that bear interest currently. See
"Zero Coupon Securities-Risk Factors."

A portion of the total realized return from conventional interest-paying
bonds comes from the reinvestment of periodic interest. Since the rate to be
earned on these reinvestments may be higher or lower than the rate quoted on the
interest-paying bonds at the time of the original purchase, the total return of
interest-paying bonds is uncertain even for investors holding the security to
its maturity. This uncertainty is commonly referred to as reinvestment risk and
can have a significant impact on total realized investment return. With zero
coupon securities, however, there are no cash distributions to reinvest, so
investors bear no reinvestment risk if they hold the zero coupon securities to
maturity.

Each Fund primarily will purchase three types of zero coupon securities:
(1) U.S. Treasury STRIPS (Separately Traded Registered Interest and Principal
Securities), which are created when the coupon payments and the principal
payment are stripped from an outstanding Treasury security by the Federal
Reserve Bank. Bonds issued by the Resolution Funding Corporation (REFCORP) can
also be stripped in this fashion. (2) STRIPS which are created when a dealer
deposits a Treasury security or a Federal agency security with a custodian for
safekeeping and then sells the coupon payments and principal payment that will
be generated by this security. Bonds issued by the Financing Corporation (FICO)
can be stripped in this fashion. (3) Zero coupon securities of federal agencies
and instrumentalities either issued directly by an agency in the form of a zero
coupon bond or created by stripping an outstanding bond.

Each Fund may invest up to 35% of its total assets in the following
instruments: interest-bearing obligations issued by the U.S. Government and its
agencies and instrumentalities (see "U.S.

<PAGE>

Government Obligations"), including, for Target Maturity 2007 Fund, zero coupon
securities maturing beyond 2007, and, for Target Maturity 2010 Fund, zero coupon
securities maturing beyond 2010; corporate debt securities, including corporate
zero coupon securities; repurchase agreements; and money market instruments
consisting of prime commercial paper, certificates of deposit of domestic
branches of U.S. banks and bankers' acceptances. Each Fund may only invest in
debt securities rated A or better by Moody's or S&P or in unrated securities
that are deemed to be of comparable quality by the Adviser. Debt obligations
rated A or better by Moody's or S&P comprise what are known as high-grade bonds
and are regarded as having a strong capacity to repay principal and make
interest payments. See Appendix A for a description of corporate bond ratings.
Each Fund may also invest in restricted and illiquid securities, make loans of
portfolio securities and purchase securities on a when-issued basis. See the SAI
for more information regarding these types of investments.

Utilities Income Fund

The primary investment objective of Utilities Income Fund is to seek high
current income. Long-term capital appreciation is a secondary objective. The
Fund seeks its objectives by investing, under normal market conditions, at least
65% of its total assets in equity and debt securities issued by companies
primarily engaged in the public utilities industry. Equity securities in which
the Fund may invest include common stocks, preferred stocks, securities
convertible into common stocks or preferred stocks, and warrants to purchase
common or preferred stocks. Debt securities in which the Fund may invest will be
rated at the time of investment at least A by Moody's or S&P or, if unrated,
will be deemed to be of comparable quality as determined by the Adviser. Debt
securities rated A or higher by Moody's or S&P or, if unrated, deemed to be of
comparable quality by the Adviser, are regarded as having a strong capacity to
pay principal and interest. The Fund's policy is to attempt to sell, within a
reasonable time period, a debt security in its portfolio which has been
downgraded below A, provided that such disposition is in the best interests of
the Fund and its shareholders. See Appendix A for a description of corporate
bond ratings. The portion of the Fund's assets invested in equity securities and
in debt securities will vary from time to time due to changes in interest rates
and economic and other factors.

The utility companies in which the Fund will invest include companies
primarily engaged in the ownership or operation of facilities used to provide
electricity, gas, water or telecommunications (including telephone, telegraph
and satellite, but not companies engaged in public broadcasting or cable
television). For these purposes, "primarily engaged" means that (1) more than
50% of the company's assets are devoted to the ownership or operation of one or
more facilities as described above, or (2) more than 50% of the company's
operating revenues are derived from the business or combination of any of the
businesses described above. It should be noted that based on this definition,
the Fund may invest in companies which are also involved to a significant degree
in non-public utilities activities.

Utility stocks generally offer dividend yields that exceed those of
industrial companies and their prices tend to be less volatile than stocks of
industrial companies. However, utility stocks can still be affected by the risks
of the stock of industrial companies. Because the Fund concentrates its
investments in public utilities companies, the value of its shares will be
especially affected by factors peculiar to the utilities industry, and may
fluctuate more widely than the value of shares of a fund that invests in a
broader range of industries. See "Utilities Industries--Risk Factors."

<PAGE>

The Fund may invest up to 35% of its total assets in the following
instruments: debt securities (rated at least A by Moody's or S&P) and common and
preferred stocks of non-utility companies; U.S. Government Obligations;
mortgage-backed securities; cash; and money market instruments consisting of
prime commercial paper, bankers' acceptances, certificates of deposit and
repurchase agreements. The Fund may invest in securities on a "when-issued" or
delayed delivery basis and make loans of portfolio securities. The Fund may
invest up to 5% of its net assets in ADRs. The Fund may borrow money for
temporary or emergency purposes in amounts not exceeding 5% of its net assets.
The Fund also may invest in zero coupon and pay-in-kind securities. In addition,
in any period of market weakness or of uncertain market or economic conditions,
the Fund may establish a temporary defensive position to preserve capital by
having all of its assets invested in short-term fixed income securities or
retained in cash or cash equivalents. See the SAI for a description of these
securities.

General. Each Fund's net asset value fluctuates based mainly upon changes
in the value of its portfolio securities. Each Fund's investment objectives and
certain investment limitations set forth in the SAI are fundamental policies
that may not be changed without shareholder approval. There can be no assurance
that any Fund will achieve its investment objectives.

Description of Certain Securities, Other Investment Policies and Risk Factors

American Depository Receipts and Global Depository Receipts. Blue Chip
Fund, International Securities Fund, Growth Fund, Utilities Income Fund and
Discovery Fund may invest in sponsored and unsponsored ADRs. ADRs are receipts
typically issued by a U.S. bank or trust company evidencing ownership of the
underlying securities of foreign issuers, and other forms of depository receipts
for securities of foreign issuers. Generally, ADRs, in registered form, are
denominated in U.S. dollars and are designed for use in the U.S. securities
markets. Thus, these securities are not denominated in the same currency as the
securities into which they may be converted. In addition, the issuers of the
securities underlying unsponsored ADRs are not obligated to disclose material
information in the United States and, therefore, there may be less information
available regarding such issuers and there may not be a correlation between such
information and the market value to the ADRs. International Securities Fund and
Growth Fund may also invest in sponsored and unsponsored GDRs. GDRs are issued
globally and evidence a similar ownership arrangement. Generally, GDRs are
designed for trading in non-U.S. securities markets. ADRs and GDRs are
considered to be foreign securities by each of the above Funds, as appropriate.
See "Foreign Securities--Risk Factors."

Bankers' Acceptances. Each Fund may invest in bankers' acceptances.
Bankers' acceptances are short-term credit instruments used to finance
commercial transactions. Generally, an acceptance is a time draft drawn on a
bank by an exporter or importer to obtain a stated amount of funds to pay for
specific merchandise. The draft is then "accepted" by a bank that, in effect,
unconditionally guarantees to pay the face value of the instrument on its
maturity date. The acceptance may then be held by the accepting bank as an asset
or it may be sold in the secondary market at the going rate of interest for a
specific maturity. Although maturities for acceptances can be as long as 270
days, most acceptances have maturities of six months or less.

Certificates of Deposit. Each Fund may invest in bank certificates of
deposit ("CDs"). The FDIC is an agency of the U.S. Government which insures the
deposits of certain banks and savings and loan associations up to $100,000 per
deposit. The interest on such deposits may not be insured

<PAGE>

if this limit is exceeded. Current Federal regulations also permit such
institutions to issue insured negotiable CDs in amounts of $100,000 or more,
without regard to the interest rate ceilings on other deposits. To remain fully
insured, these investments currently must be limited to $100,000 per insured
bank or savings and loan association.

Commercial Paper. Commercial paper is a promissory note issued by a
corporation to finance short-term credit needs which may either be unsecured or
backed by a letter of credit. Commercial paper includes notes, drafts or similar
instruments payable on demand or having a maturity at the time of issuance not
exceeding nine months, exclusive of days of grace or any renewal thereof. See
Appendix A to the SAI for a description of commercial paper ratings.

Convertible Securities. A convertible security is a bond, debenture, note,
preferred stock or other security that may be converted into or exchanged for a
prescribed amount of common stock of the same or a different issuer within a
particular period of time at a specified price or formula. A convertible
security entitles the holder to receive interest paid or accrued on debt or
dividends paid on preferred stock until the convertible security matures or is
redeemed, converted or exchanged. Convertible securities have unique investment
characteristics in that they generally (1) have higher yields than common
stocks, but lower yields than comparable non-convertible securities, (2) are
less subject to fluctuation in value than the underlying stock because they have
fixed income characteristics, and (3) provide the potential for capital
appreciation if the market price of the underlying common stock increases. See
the SAI for more information on convertible securities.

Debt Securities--Risk Factors. The market value of debt securities is
influenced primarily by changes in the level of interest rates. Generally, as
interest rates rise, the market value of debt securities decreases. Conversely,
as interest rates fall, the market value of debt securities increases. Factors
which could result in a rise in interest rates, and a decrease in the market
value of debt securities, include an increase in inflation or inflation
expectations, an increase in the rate of U.S. economic growth, an expansion in
the Federal budget deficit or an increase in the price of commodities such as
oil. In addition, the market value of debt securities is influenced by
perceptions of the credit risks associated with such securities. Sale of debt
securities prior to maturity may result in a loss and the inability to replace
the sold securities with debt securities with a similar yield. Debt obligations
rated lower than Baa by Moody's or BBB by S&P, commonly referred to as "junk
bonds," are speculative and generally involve a higher risk of loss of principal
and income than higher-rated securities. See "High Yield Securities--Risk
Factors" and Appendix A for a description of corporate bond ratings.

Deep Discount Securities. High Yield Fund may invest up to 15% of its total
assets in securities of companies that are financially troubled, in default or
undergoing bankruptcy or reorganization. Such securities are usually available
at a deep discount from the face value of the instrument. The Fund will invest
in Deep Discount Securities when the Adviser believes that there exist factors
that are likely to restore the company to a healthy financial condition. Such
factors include a restructuring of debt, management changes, existence of
adequate assets or other unusual circumstances. Debt instruments purchased at
deep discounts may pay very high effective yields. In addition, if the financial
condition of the issuer improves, the underlying value of the security may
increase, resulting in a capital gain. If the company defaults on its
obligations or remains in default, or if the plan of reorganization is
insufficient for debtholders, the Deep Discount Securities may stop paying
interest and lose value or become worthless. The Adviser will balance the
benefits of Deep Discount Securities with their risks. While a diversified
portfolio may reduce the overall impact of

<PAGE>

a Deep Discount Security that is in default or loses its value, the risk cannot
be eliminated. See "High Yield Securities--Risk Factors."

Eurodollar Certificates of Deposit. Cash Management Fund may invest in
Eurodollar CDs, which are issued by London branches of domestic or foreign
banks. Such securities involve risks that differ from certificates of deposit
issued by domestic branches of U.S. banks. These risks include future political
and economic developments, the possible imposition of United Kingdom withholding
taxes on interest income payable on the securities, the possible establishment
of exchange controls, the possible seizure or nationalization of foreign
deposits or the adoption of other foreign governmental restrictions that might
adversely affect the payment of principal and interest on such securities.

Foreign Securities--Risk Factors. International Securities Fund, High Yield
Fund and Discovery Fund may sell a security denominated in a foreign currency
and retain the proceeds in that foreign currency to use at a future date (to
purchase other securities denominated in that currency) or a Fund may buy
foreign currency outright to purchase securities denominated in that foreign
currency at a future date. Because none of these Funds intend to hedge their
foreign investments, the Fund will be affected by changes in exchange control
regulations and fluctuations in the relative rates of exchange between the
currencies of different nations, as well as by economic and political
developments. Other risks involved in foreign securities include the following:
there may be less publicly available information about foreign companies
comparable to the reports and ratings that are published about companies in the
United States; foreign companies are not generally subject to uniform
accounting, auditing and financial reporting standards and requirements
comparable to those applicable to U.S. companies; some foreign stock markets
have substantially less volume than U.S. markets, and securities of some foreign
companies are less liquid and more volatile than securities of comparable U.S.
companies; there may be less government supervision and regulation of foreign
stock exchanges, brokers and listed companies than exist in the United States;
and there may be the possibility of expropriation or confiscatory taxation,
political or social instability or diplomatic developments which could affect
assets of a Fund held in foreign countries.

International Securities Fund's and Discovery Fund's investments in
emerging markets include investments in countries whose economies or securities
markets are not yet highly developed. Special considerations associated with
these emerging market investments (in addition to the considerations regarding
foreign investments generally) may include, among others, greater political
uncertainties, an economy's dependence on revenues from particular commodities
or on international aid or development assistance, currency transfer
restrictions, a limited number of potential buyers for such securities and
delays and disruptions in securities settlement procedures.

High Yield Securities--Risk Factors. High Yield Securities are subject to
certain risks that may not be present with investments in higher grade
securities.

Effect of Interest Rate and Economic Changes. High Yield Securities rated
lower than Baa by Moody's or BBB by S&P, commonly referred to as "junk bonds,"
are speculative and generally involve a higher risk or loss of principal and
income than higher-rated securities. The prices of High Yield Securities tend to
be less sensitive to interest rate changes than higher-rated investments, but
may be more sensitive to adverse economic changes or individual corporate
developments. Periods of economic uncertainty and changes generally result in
increased volatility in the market prices and yields of High Yield Securities
and thus in a Fund's net asset value. A strong economic downturn

<PAGE>

or a substantial period of rising interest rates could severely affect the
market for High Yield Securities. In these circumstances, highly leveraged
companies might have greater difficulty in making principal and interest
payments, meeting projected business goals, and obtaining additional financing.
Thus, there could be a higher incidence of default. This would affect the value
of such securities and thus a Fund's net asset value. Further, if the issuer of
a security owned by a Fund defaults, that Fund might incur additional expenses
to seek recovery.

Generally, when interest rates rise, the value of fixed rate debt
obligations, including High Yield Securities, tends to decrease; when interest
rates fall, the value of fixed rate debt obligations tends to increase. If an
issuer of a High Yield Security containing a redemption or call provision
exercises either provision in a declining interest rate market, a Fund would
have to replace the security, which could result in a decreased return for
shareholders. Conversely, if a Fund experiences unexpected net redemptions in a
rising interest rate market, it might be forced to sell certain securities,
regardless of investment merit. This could result in decreasing the assets to
which Fund expenses could be allocated and in a reduced rate of return for that
Fund. While it is impossible to protect entirely against this risk,
diversification of a Fund's portfolio and the Adviser's careful analysis of
prospective portfolio securities should minimize the impact of a decrease in
value of a particular security or group of securities in a Fund's portfolio.

The High Yield Securities Market. The market for below investment
grade bonds expanded rapidly in recent years and its growth paralleled a long
economic expansion. In the past, the prices of many lower-rated debt securities
declined substantially, reflecting an expectation that many issuers of such
securities might experience financial difficulties. As a result, the yields on
lower-rated debt securities rose dramatically. However, such higher yields did
not reflect the value of the income streams that holders of such securities
expected, but rather the risk that holders of such securities could lose a
substantial portion of their value as a result of the issuers' financial
restructuring or default. There can be no assurance that such declines in the
below investment grade market will not reoccur. The market for below investment
grade bonds generally is thinner and less active than that for higher quality
bonds, which may limit a Fund's ability to sell such securities at fair value in
response to changes in the economy or the financial markets. Adverse publicity
and investor perceptions, whether or not based on fundamental analysis, may also
decrease the values and liquidity of lower rated securities, especially in a
thinly traded market.

Credit Ratings. The credit ratings issued by credit rating services
may not fully reflect the true risks of an investment. For example, credit
ratings typically evaluate the safety of principal and interest payments, not
market value risk, of High Yield Securities. Also, credit rating agencies may
fail to change on a timely basis a credit rating to reflect changes in economic
or company conditions that affect a security's market value. Although the
Adviser considers ratings of recognized rating services such as Moody's and S&P,
the Adviser primarily relies on its own credit analysis, which includes a study
of existing debt, capital structure, ability to service debt and to pay
dividends, the issuer's sensitivity to economic conditions, its operating
history and the current trend of earnings. High Yield Fund may invest in
securities rated as low as D by S&P or C by Moody's or, if unrated, deemed to be
of comparable quality by the Adviser. Debt obligations with these ratings either
have defaulted or are in great danger of defaulting and are considered to be
highly speculative. See "Deep Discount Securities." The Adviser continually
monitors the investments in a Fund's portfolio and carefully evaluates whether
to dispose of or retain High Yield Securities whose credit ratings have changed.
See Appendix A for a description of corporate bond ratings.

<PAGE>

Liquidity and Valuation. Lower-rated bonds are typically traded
among a smaller number of broker-dealers than in a broad secondary market.
Purchasers of High Yield Securities tend to be institutions, rather than
individuals, which is a factor that further limits the secondary market. To the
extent that no established retail secondary market exists, many High Yield
Securities may not be as liquid as higher-grade bonds. A less active and thinner
market for High Yield Securities than that available for higher quality
securities may result in more volatile valuations of a Fund's holdings and more
difficulty in executing trades at favorable prices during unsettled market
conditions.

The ability of a Fund to value or sell High Yield Securities will be
adversely affected to the extent that such securities are thinly traded or
illiquid. During such periods, there may be less reliable objective information
available and thus the responsibility of Life Series Fund's Board of Trustees to
value High Yield Securities becomes more difficult, with judgment playing a
greater role. Further, adverse publicity about the economy or a particular
issuer may adversely affect the public's perception of the value, and thus
liquidity, of a High Yield Security, whether or not such perceptions are based
on a fundamental analysis.

Legislation. Provisions of the Revenue Reconciliation Act of 1989
limit a corporate issuer's deduction for a portion of the original issue
discount on "high yield discount" obligations (including certain pay-in-kind
securities). This limitation could have a materially adverse impact on the
market for certain High Yield Securities. From time to time, legislators and
regulators have proposed other legislation that would limit the use of high
yield debt securities in leveraged buyouts, mergers and acquisitions. It is not
certain whether such proposals, which also could adversely affect High Yield
Securities, will be enacted into law.

Market Risk. Blue Chip Fund, Discovery Fund, Growth Fund and Utilities
Income Fund are subject to market risk because they invest primarily in common
stocks. Market risk is the possibility that common stock prices will decline
over short or even extended periods. The U.S. stock market tends to be cyclical,
with periods when stock prices generally rise and periods when stock prices
generally decline.

Mortgage-Backed Securities

Mortgage loans made by banks, savings and loan institutions and
other lenders are often assembled into pools, the interests in which are issued
and guaranteed by an agency or instrumentality of the U.S. Government, though
not necessarily by the U.S. Government itself. Interests in such pools are
referred to herein as "mortgage-backed securities." The market value of these
securities will fluctuate as interest rates and market conditions change. In
addition, prepayment of principal by the mortgagees, which often occurs with
mortgage-backed securities when interest rates decline, can significantly change
the realized yield of these securities.

GNMA certificates are backed as to the timely payment of principal
and interest by the full faith and credit of the U.S. Government. Payments of
principal and interest on FNMA certificates are guaranteed only by FNMA itself,
not by the full faith and credit of the U.S. Government. FHLMC certificates
represent mortgages for which FHLMC has guaranteed the timely payment of
principal and interest but, like a FNMA certificate, they are not guaranteed by
the full faith and credit of the U.S. Government.

<PAGE>

Collateralized Mortgage Obligations and Multiclass Pass-Through
Securities. Collateralized mortgage obligations ("CMOs") are debt obligations
collateralized by mortgage loans or mortgage pass-through securities. Typically,
CMOs are collateralized by GNMA certificates or other government mortgage-backed
securities (such collateral collectively hereinafter referred to as "Mortgage
Assets"). Multiclass pass-through securities are interests in trusts that are
comprised of Mortgage Assets. Unless the context indicates otherwise, references
herein to CMOs include multiclass pass-through securities. Payments of principal
of, and interest on, the Mortgage Assets, and any reinvestment income thereon,
provide the funds to pay debt service on the CMOs or to make scheduled
distributions on the multiclass pass-through securities. CMOs in which
Government Fund may invest are issued or guaranteed by U.S. Government agencies
or instrumentalities, such as FNMA and FHLMC. See the SAI for more information
on CMOs.

Stripped Mortgage-Backed Securities. Government Fund, Target
Maturity 2007 Fund and Target Maturity 2010 Fund may invest in stripped
mortgage-backed securities ("SMBS"), which are derivative multiclass mortgage
securities. SMBS are usually structured with two classes that receive different
proportions of the interest and principal distributions from a pool of mortgage
assets. A common type of SMBS will have one class receiving most of the interest
and the remainder of the principal. In the most extreme case, one class will
receive all of the interest while the other class will receive all of the
principal. If the underlying Mortgage Assets experience greater than anticipated
prepayments of principal, the Fund may fail to fully recoup its initial
investment in these securities. The market value of the class consisting
primarily or entirely of principal payments generally is unusually volatile in
response to changes in interest rates.

Risks of Mortgage-Backed Securities. Investments in mortgage-backed
securities entail both market and prepayment risk. Fixed-rate mortgage-backed
securities are priced to reflect, among other things, current and perceived
interest rate conditions. As conditions change, market values will fluctuate. In
addition, the mortgages underlying mortgage-backed securities generally may be
prepaid in whole or in part at the option of the individual buyer. Prepayments
of the underlying mortgages can affect the yield to maturity on mortgage-backed
securities and, if interest rates decline, the prepayment may only be invested
at the then prevailing lower interest rate. Changes in market conditions,
particularly during periods of rapid or unanticipated changes in market interest
rates, may result in volatility and reduced liquidity of the market value of
certain mortgage-backed securities. CMOs and SMBS involve similar risks,
although they may be more volatile and even less liquid.

Preferred Stock. A preferred stock is a blend of the characteristics of a
bond and common stock. It can offer the higher yield of a bond and has priority
over common stock in equity ownership, but does not have the seniority of a bond
and, unlike common stock, its participation in the issuer's growth may be
limited. Preferred stock has preference over common stock in the receipt of
dividends and in any residual assets after payment to creditors should the
issuer be dissolved. Although the dividend is set at a fixed annual rate, in
some circumstances it can be changed or omitted by the issuer.

Repurchase Agreements. Repurchase agreements are transactions in which a
Fund purchases securities from a bank or recognized securities dealer and
simultaneously commits to resell the securities to the bank or dealer at an
agreed-upon date and price reflecting a market rate of interest unrelated to the
coupon rate or maturity of the purchased securities. Each Fund's risk is

<PAGE>

limited primarily to the ability of the seller to repurchase the securities at
the agreed-upon price upon the delivery date. See the SAI for more information
regarding repurchase agreements.

Restricted and Illiquid Securities. Each Fund, other than Cash Management
Fund, may invest up to 15% of its net assets in illiquid securities. Cash
Management Fund may invest up to 10% of its net assets in illiquid securities.
These securities include (1) securities that are illiquid due to the absence of
a readily available market or due to legal or contractual restrictions on resale
and (2) repurchase agreements maturing in more than seven days. However,
illiquid securities for purposes of this limitation do not include securities
eligible for resale to qualified institutional buyers pursuant to Rule 144A
under the Securities Act of 1933, as amended, which Life Series Fund's Board of
Trustees or the Adviser or the Subadviser, as applicable, has determined are
liquid under Board- approved guidelines. See the SAI for more information
regarding restricted and illiquid securities.

Under current guidelines of the staff of the SEC, interest-only and
principal-only classes of fixed-rate mortgage-backed securities in which
Government Fund may invest are considered illiquid. However, such securities
issued by the U.S. Government or one of its agencies or instrumentalities will
not be considered illiquid if the Adviser has determined that they are liquid
pursuant to guidelines established by Life Series Fund's Board of Trustees.
Government Fund, Target Maturity 2007 Fund and Target Maturity 2010 Fund may not
be able to sell illiquid securities when the Adviser considers it desirable to
do so or may have to sell such securities at a price lower than could be
obtained if they were more liquid. Also the sale of illiquid securities may
require more time and may result in higher dealer discounts and other selling
expenses than does the sale of securities that are not illiquid. Illiquid
securities may be more difficult to value due to the unavailability of reliable
market quotations for such securities, and investment in illiquid securities may
have an adverse impact on these Fund's net asset value.

Time Deposits. Cash Management Fund may invest in time deposits. Time
deposits are non-negotiable deposits maintained in a banking institution for a
specified period of time at a stated interest rate. For the most part, time
deposits which may be held by the Fund would not benefit from insurance from the
Bank Insurance Fund or the Savings Association Insurance Fund administered by
the FDIC.

U.S. Government Obligations. Securities issued or guaranteed as to
principal and interest by the U.S. Government include (1) U.S. Treasury
obligations which differ only in their interest rates, maturities and times of
issuance as follows: U.S. Treasury bills (maturities of one year or less), U.S.
Treasury notes (maturities of one to ten years), and U.S. Treasury bonds
(generally maturities of greater than ten years); and (2) obligations issued or
guaranteed by U.S. Government agencies and instrumentalities that are backed by
the full faith and credit of the United States, such as securities issued by the
Federal Housing Administration, GNMA, the Department of Housing and Urban
Development, the Export-Import Bank, the General Services Administration and the
Maritime Administration and certain securities issued by the Farmers Home
Administration and the Small Business Administration. The range of maturities of
U.S. Government Obligations is usually three months to thirty years.

Utilities Industry-Risk Factors. Stocks of utilities companies generally
offer dividend yields that exceed those of industrial companies and their prices
tend to be less volatile than stocks of industrial companies. However, utility
stocks can still be affected by the risks of the stock market in general, as
well as factors specific to public utilities companies.

<PAGE>

Many utility companies, especially electric and gas and other
energy-related utility companies, have historically been subject to the risk of
increases in fuel and other operating costs, changes in interest rates on
borrowing for capital improvement programs, changes in applicable laws and
regulations, and costs and operating constraints associated with compliance with
environmental regulations. In particular, regulatory changes with respect to
nuclear and conventionally-fueled power generating facilities could increase
costs or impair the ability of utility companies to operate such facilities or
obtain adequate return on invested capital.

Certain utilities, especially gas and telephone utilities, have in recent
years been affected by increased competition, which could adversely affect the
profitability of such utility companies. In addition, expansion by companies
engaged in telephone communication services of their non-regulated activities
into other businesses (such as cellular telephone services, data processing,
equipment retailing, computer services and financial services) has provided the
opportunity for increases in earnings and dividends at faster rates than have
been allowed in traditional regulated businesses. However, technological
innovations and other structural changes also could adversely affect the
profitability of such companies in competition with utilities companies.

Because securities issued by utility companies are particularly sensitive
to movements in interest rates, the equity securities of such companies are more
affected by movements in interest rates than are the equity securities of other
companies.

Each of these risks could adversely affect the ability and inclination of
public utilities companies to declare or pay dividends and the ability of
holders of common stock, such as the Utilities Income Fund, to realize any value
from the assets of the company upon liquidation or bankruptcy.

Variable Rate and Floating Rate Notes. Cash Management Fund may invest in
derivative variable rate and floating rate notes. Issuers of such notes include
corporations, banks, broker-dealers and finance companies. Variable rate notes
include master demand notes which are obligations permitting the holder to
invest fluctuating amounts, which may change daily without penalty, pursuant to
direct arrangements between the Fund, as lender, and the borrower. The interest
rates on these notes fluctuate from time to time. The issuer of such obligations
normally has a corresponding right, after a given period, to prepay in its
discretion the outstanding principal amount of the obligations plus accrued
interest upon a specified number of days' notice to the holders of such
obligations. See the SAI for more information on these securities.

Zero Coupon and Pay-In-Kind Securities. Zero coupon securities are debt
obligations that do not entitle the holder to any periodic payment of interest
prior to maturity or a specified date when the securities begin paying current
interest. They are issued and traded at a discount from their face amount or par
value, which discount varies depending on the time remaining until cash payments
begin, prevailing interest rates, liquidity of the security and the perceived
credit quality of the issuer. Pay-in-kind securities are those that pay interest
through the issuance of additional securities. The market prices of zero coupon
and pay-in-kind securities generally are more volatile than the prices of
securities that pay interest periodically and in cash and are likely to respond
to changes in interest rates to a greater degree than do other types of debt
securities having similar maturities and credit quality. Original issue discount
earned on zero coupon securities and the "interest" on pay-in-kind securities
must be included in a Fund's income. Thus, to continue to qualify for tax
treatment as a regulated investment company and to avoid a certain excise tax on
undistributed income, a Fund may be required to distribute as a dividend an
amount that is greater

<PAGE>

than the total amount of cash it actually receives. See "Taxes" in the SAI.
These distributions must be made from a Fund's cash assets or, if necessary,
from the proceeds of sales of portfolio securities. A Fund will not be able to
purchase additional income-producing securities with cash used to make such
distributions, and its current income ultimately could be reduced as a result.

Zero Coupon Securities-Risk Factors. Zero coupon securities are debt
securities and thus are subject to the same risk factors as all debt securities.
See "Debt Securities-Risk Factors." The market prices of zero coupon securities,
however, generally are more volatile than the prices of securities that pay
interest periodically and in cash and are likely to respond to changes in
interest rates to a greater degree than do other types of debt securities having
similar maturities and credit quality. As a result, the net asset value of
shares of the Target Maturity 2007 Fund and Target Maturity 2010 Fund may
fluctuate over a greater range than shares of the other Funds or mutual funds
that invest in debt obligations having similar maturities but that make current
distributions of interest.

Zero coupon securities can be sold prior to their due date in the secondary
market at their then prevailing market value, which depends primarily on the
time remaining to maturity, prevailing levels of interest rates and the
perceived credit quality of the issuer. The prevailing market value may be more
or less than the securities' value at the time of purchase. While the objective
of both the Target Maturity 2007 Fund and Target Maturity 2010 Fund is to seek a
predictable compounded investment return for investors who hold their Fund
shares until that Fund's maturity, a Fund cannot assure that it will be able to
achieve a certain level of return due to the possible necessity of having to
sell certain zero coupon securities to pay expenses, dividends or to meet
redemptions at times and at prices that might be disadvantageous or,
alternatively, the need to invest assets received from new purchases at
prevailing interest rates, which would expose a Fund to reinvestment risk. In
addition, no assurance can be given as to the liquidity of the market for
certain of these securities. Determination as to the liquidity of such
securities will be made in accordance with guidelines established by Life Series
Fund's Board of Trustees. In accordance with such guidelines, the Adviser will
monitor each Fund's investments in such securities with particular regard to
trading activity, availability of reliable price information and other relevant
information.

Portfolio Turnover. The sustained and substantial decrease in interest
rates during 1995 caused the Government Fund's portfolio to be restructered
several times. In particular, declining rates increased prepayments on
mortgage-backed securities, causing their durations to decrease. In order to
offset the decrease in duration, the Government Fund had to actively manage its
mortgage-backed holdings. This resulted in a portfolio turnover rate for the
fiscal year ended December 31, 1995 of 198% and 457% for the prior fiscal year.
A high rate of portfolio turnover generally leads to increased transaction costs
and may result in a greater number of taxable transactions. See "Allocation of
Portfolio Brokerage" in the SAI. The Target Maturity 2010 Fund currently does
not expect its annual rate of portfolio turnover to exceed 100%. See the SAI for
the other Funds' portfolio turnover rate and for more information on portfolio
turnover.

HOW TO BUY SHARES

Investments in a Fund are only available through purchases of the Policies
or the Contracts offered by First Investors Life. Policy premiums, net of
certain expenses, are paid into a unit investment trust, Separate Account B.
Purchase payments for the Contracts, net of certain expenses, are also paid into
a unit investment trust, Separate Account C. The Separate Accounts pool these

<PAGE>

proceeds to purchase shares of a Fund designated by purchasers of the Policies
or Contracts. Orders for the purchase of Fund shares received prior to the close
of regular trading on the New York Stock Exchange ("NYSE"), generally 4:00 P.M.
(New York City time), on any business day the NYSE is open for trading, will be
processed and shares will be purchased at the net asset value determined at the
close of regular trading on the NYSE on that day. Orders received after the
close of regular trading on the NYSE will be processed at the net asset value
determined at the close of regular trading on the NYSE on the next trading day.
See "Determination of Net Asset Value."

Due to emergency conditions, such as snow storms, the Woodbridge offices of
First Investors Corporation ("FIC"), the underwriter of Separate Accounts B and
C, and Administrative Data Management Corp. (the "Transfer Agent") may not be
open for business on a day when the NYSE is open for regular trading and,
therefore, would be unable to accept purchase orders. Should this occur,
purchase orders will be executed at the net asset value determined at the close
of regular trading on the NYSE on the next business day that these offices are
open for business.

HOW TO REDEEM SHARES

Shares of a Fund may be redeemed at the direction of Policyowners or
Contractowners, in accordance with the terms of the Policies or Contracts.
Redemptions will be made at the next determined net asset value of the
respective Fund upon receipt of a proper request for redemption or repurchase.
Payment will be made by check as soon as possible but within seven days after
presentation. However, Life Series Fund's Board of Trustees may suspend the
right of redemption or postpone the date of payment during any period when (a)
trading on the NYSE is restricted as determined by the Securities and Exchange
Commission ("SEC") or the NYSE is closed for other than weekends and holidays,
(b) the SEC has by order permitted such suspension, or (c) an emergency, as
defined by rules of the SEC, exists during which time the sale or valuation of
portfolio securities held by a Fund is not reasonably practicable.

Due to emergency conditions, such as snow storms, the Woodbridge offices of
FIC and the Transfer Agent may not be open for business on a day when the NYSE
is open for regular trading and, therefore, would be unable to accept redemption
orders. Should this occur, redemption orders will be executed at the net asset
value determined at the close of regular trading on the NYSE on the next
business day that these offices are open for business.

MANAGEMENT

Board of Trustees. Life Series Fund's Board of Trustees, as part of its
overall management responsibility, oversees various organizations responsible
for each Fund's day-to-day management.

Adviser. First Investors Management Company, Inc. supervises and manages
each Fund's investments, supervises all aspects of each Fund's operations and,
except for International Securities Fund and Growth Fund, determines each Fund's
portfolio transactions. The Adviser is a New York corporation located at 95 Wall
Street, New York, NY 10005. First Investors Consolidated Corporation ("FICC")
owns all of the voting common stock of the Adviser and all of the outstanding
stock of First Investors Corporation and the Transfer Agent. Mr. Glenn O. Head
controls FICC and, therefore, controls the Adviser.

<PAGE>

As compensation for its services, the Adviser receives an annual fee from
each Fund, which is payable monthly. For the fiscal year ended December 31,
1995, the advisory fees were 0.75% of average daily net assets for each of Blue
Chip Fund, Discovery Fund, Growth Fund, High Yield Fund and International
Securities Fund, 0.35% of average daily net assets, net of waiver, for each of
Cash Management Fund, Government Fund, Investment Grade Fund and Utilities
Income Fund. The Adviser waived Target Maturity 2007 Fund's advisory fee in its
entirety. As compensation for its services, the Adviser will receive a fee from
Target Maturity 2010 Fund at the rate of 0.75% of the average daily net assets
of that Fund. The SEC staff takes the position that fees of 0.75% or greater are
higher than those paid by most investment companies.

Subadviser. Wellington Management Company has been retained by the Adviser
and Life Series Fund, on behalf of International Securities Fund and Growth
Fund, as each of those Fund's investment subadviser. The Adviser has delegated
discretionary trading authority to WMC with respect to all the assets of
International Securities Fund and Growth Fund, subject to the continuing
oversight and supervision of the Adviser and the Board of Trustees. As
compensation for its services, WMC is paid by the Adviser, and not by either
Fund, a fee which is computed daily and paid monthly.

WMC, located at 75 State Street, Boston, MA 02109, is a Massachusetts
general partnership of which Robert W. Doran, Duncan M. McFarland and John R.
Ryan are Managing Partners. WMC is a professional investment counseling firm
which provides investment services to investment companies, employee benefit
plans, endowment funds, foundations and other institutions and individuals. As
of December 31, 1995, WMC held investment management authority with respect to
approximately $109.2 billion of assets. Of that amount, WMC acted as investment
adviser or subadviser to approximately 110 registered investment companies or
series of such companies, with net assets of approximately $76.1 billion as of
December 31, 1995. WMC is not affiliated with the Adviser or any of its
affiliates.

For the fiscal year ended December 31, 1995, the Subadviser's fees amounted
to 0.34% of Growth Fund's average daily net assets and 0.40% of International
Securities Fund's average daily net assets, all of which was paid by the Adviser
and not by the Funds.

Portfolio Managers. Patricia D. Poitra, Director of Equities, has been
primarily responsible for the day-to-day management of the Blue Chip Fund since
October 1994 and Discovery Fund since 1988. Ms. Poitra is assisted by a team of
portfolio analysts. Ms. Poitra has been responsible for the management of the
Special Situations Fund, the Blue Chip Fund and the equity portion of Total
Return Fund, all series of First Investors Series Fund. Ms. Poitra also is
responsible for the management of the Blue Chip Fund of Executive Investors
Trust and the U.S.A. Mid-Cap Opportunity Fund of First Investors Series Fund II,
Inc. Ms. Poitra joined FIMCO in 1985 as a Senior Equity Analyst.

George V. Ganter has been Portfolio Manager for High Yield Fund since 1989.
Mr. Ganter joined FIMCO in 1985 as a Senior Analyst. In 1986, he became
Portfolio Manager for First Investors Special Bond Fund, Inc. In 1989, he became
Portfolio Manager for First Investors High Yield Fund, Inc. and Executive
Investors High Yield Fund.

Margaret R. Haggerty is Portfolio Manager for Utilities Income Fund. Ms.
Haggerty joined FIMCO in 1990 as an analyst for several First Investors equity
funds. In addition, she monitored

<PAGE>

the management of several First Investors funds for which WMC was the
subadviser. In early 1993, she became Portfolio Manager for First Investors
Utilities Income Fund of First Investors Series Fund II, Inc.

Nancy Jones has been Portfolio Manager for Investment Grade Fund since its
inception in 1992. Ms. Jones joined FIMCO in 1983 as Director of Research in the
High Yield Department. In 1989, she became Portfolio Manager for First Investors
Fund For Income, Inc. Ms. Jones has been Portfolio Manager for Investment Grade
Fund of First Investors Series Fund since its inception in 1991 and has managed
the fixed income corporate securities portion of Total Return Fund of First
Investors Series Fund since 1992.

Since August 1995, WMC's Growth Investment Team, a group of equity
portfolio managers and senior investment professionals, has assumed
responsibility for managing the Growth Fund.

Since October 1995, Clark D. Wagner has been primarily responsible for the
day-to-day management of the Government Fund and the Target Maturity 2007 Fund.
Mr. Wagner will have the primary responsibility for the day-to-day management of
Target Maturity 2010 Fund. Since he joined FIMCO in 1991, Mr. Wagner has been
Portfolio Manager for all of First Investors municipal bond funds. Mr. Wagner
also is responsible for the day-to-day management of First Investors Government
Fund, Inc. In 1992, he became Chief Investment Officer of FIMCO.

Since April 1, 1994, International Securities Fund is managed by WMC's
Global Equity Strategy Group, a group of global portfolio managers and senior
investment professionals headed by Trond Skramstad. Prior to joining WMC as a
portfolio manager in 1993, Mr. Skramstad was a global portfolio manager at
Scudder, Stevens & Clark since 1990.

DETERMINATION OF NET ASSET VALUE

The net asset value of shares of each Fund is determined as of the close of
regular trading on the NYSE (generally 4:00 P.M., New York City time) on each
day the NYSE is open for trading, and at such other times as Life Series Fund's
Board of Trustees deems necessary by dividing the value of the securities held
by a Fund, plus any cash and other assets, less all liabilities, by the number
of shares outstanding. If there is no available market value, securities will be
valued at their fair value as determined in good faith pursuant to procedures
adopted by the Board of Trustees. The NYSE currently observes the following
holidays: New Year's Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

The investments in Cash Management Fund, when purchased at a discount, are
valued at amortized cost and when purchased at face value, are valued at cost
plus accrued interest.

DIVIDENDS AND OTHER DISTRIBUTIONS

For the purposes of determining dividends, the net investment income of
each Fund, other than Cash Management Fund, consists of interest and dividends,
earned discount and other income earned on portfolio securities less expenses.
Net investment income of Cash Management Fund consists of (i) accrued interest,
plus or minus (ii) all realized and unrealized gains and losses on the Fund's
securities, less (iii) accrued expenses. Dividends from net investment income
are generally

<PAGE>

declared and paid annually by each Fund, other than Cash Management Fund.
Dividends from net investment income are generally declared daily and paid
monthly by Cash Management Fund. Distributions of a Fund's net capital gain (the
excess of net long-term capital gain over net short-term capital loss), if any,
after deducting any available capital loss carryovers, are declared and paid
annually by each Fund, other than Cash Management Fund, which does not
anticipate realizing any such gain. International Securities Fund and High Yield
Fund also distribute any net realized gains from foreign currency transactions
with their annual distribution. All dividends and other distributions are paid
in shares of the distributing Fund at net asset value (without sales charge),
generally determined as of the close of business on the business day immediately
following the record date of such distribution.

TAXES

Each Fund has qualified, or intends to qualify, for treatment as a
regulated investment company ("RIC") under Subchapter M of the Internal Revenue
Code of 1986, as amended ("Code"), so that it will be relieved of Federal income
tax on that part of its investment company taxable income (consisting generally
of net investment income, net short-term capital gain and, for International
Securities Fund and High Yield Fund, net gains from certain foreign currency
transactions) and net capital gain that is distributed to its shareholders.

Shares of the Funds are offered only to the Separate Accounts, which are
insurance company separate accounts that fund variable annuity and variable life
insurance contracts. Under the Code, no tax is imposed on an insurance company
with respect to income of a qualifying separate account that is properly
allocable to the value of eligible variable annuity (or variable life insurance)
contracts. Please refer to "Federal Income Tax Status" in the Prospectuses of
Separate Accounts B and C for information as to the tax status of those accounts
and the holders of the Contracts or Policies.

Each Fund intends to comply with the diversification requirements imposed
by section 817(h) of the Code and the regulations thereunder. These
requirements, which are in addition to the diversification requirements imposed
on the Fund by the Investment Company Act of 1940, as amended, and Subchapter M
of the Code, place certain limitations on the assets of Separate Accounts B and
C -- and of a Fund, because section 817(h) and those regulations treat the
assets of a Fund as assets of Separate Accounts B and C -- that may be invested
in securities of a single issuer. Specifically, the regulations provide that,
except as permitted by the "safe harbor" described below, as of the end of each
calendar quarter (or within 30 days thereafter) no more than 55% of a Fund's
total assets may be represented by any one investment, no more than 70% by any
two investments, no more than 80% by any three investments and no more than 90%
by any four investments. For this purpose, all securities of the same issuer are
considered a single investment, and while each U.S. Government agency and
instrumentality is considered a separate issuer, a particular foreign government
and its agencies, instrumentalities and political subdivisions are considered
the same issuer. Section 817(h) provides, as a safe harbor, that a separate
account will be treated as being adequately diversified if the diversification
requirements under Subchapter M are satisfied and no more than 55% of the value
of the account's total assets are cash and cash items, government securities and
securities of other RICs. Failure of a Fund to satisfy the section 817(h)
requirements would result in taxation of First Investors Life and treatment of
the Contract holders and Policyowners other than as described in the
Prospectuses of Separate Accounts B and C.

<PAGE>

The foregoing is only a summary of some of the important Federal income tax
considerations generally affecting each Fund and its shareholders; see the SAI
for a more detailed discussion. Shareholders are urged to consult their tax
advisers.

GENERAL INFORMATION

Organization. Life Series Fund is a Massachusetts business trust organized
on June 12, 1985. The Board of Trustees of Life Series Fund has authority to
issue an unlimited number of shares of beneficial interest of separate series,
no par value, of Life Series Fund. The shares of beneficial interest of Life
Series Fund are presently divided into eleven separate and distinct series. Life
Series Fund does not hold annual shareholder meetings. If requested to do so by
the holders of at least 10% of Life Series Fund's outstanding shares, the Board
of Trustees will call a special meeting of shareholders for any purpose,
including the removal of Trustees.

Custodian. The Bank of New York, 48 Wall Street, New York, NY 10286, is
custodian of the securities and cash of each Fund, except the International
Securities Fund. Brown Brothers Harriman & Co., 40 Water Street, Boston, MA
02109, is custodian of the securities and cash of the International Securities
Fund and employs foreign sub-custodians to provide custody of the Fund's foreign
assets.

Transfer Agent. Administrative Data Management Corp., 581 Main Street,
Woodbridge, NJ 07095-1198, an affiliate of FIMCO and FIC, acts as transfer agent
for each Fund and as redemption agent for regular redemptions.

Performance. Performance information is contained in Life Series Fund's
Annual Report which may be obtained without charge by contacting First Investors
Life at 212-858-8200.

Shareholder Inquiries. Shareholder inquiries can be made by calling First
Investors Life at 212-858-8200.

Annual and Semi-Annual Reports to Shareholders. It is Life Series Fund's
practice to mail only one copy of its annual and semi-annual reports to any
address at which more than one shareholder with the same last name has indicated
that mail is to be delivered. Additional copies of the reports will be mailed if
requested in writing or by telephone by any shareholder. Life Series Fund will
ensure that an additional copy of such reports are sent to any shareholder who
subsequently changes his or her mailing address.

APPENDIX A
DESCRIPTION OF CORPORATE BOND RATINGS

STANDARD & POOR'S RATINGS GROUP

The ratings are based on current information furnished by the issuer or
obtained by S&P from other sources it considers reliable. S&P does not perform
any audit in connection with any rating and may, on occasion, rely on unaudited
financial information. The ratings may be changed, suspended, or withdrawn as a
result of changes in, or unavailability of, such information, or based on other
circumstances.

<PAGE>

The ratings are based, in varying degrees, on the following considerations:

1. Likelihood of default-capacity and willingness of the obligor as to
the timely payment of interest and repayment of principal in
accordance with the terms of the obligation;

2. Nature of and provisions of the obligation;

3. Protection afforded by, and relative position of, the obligation in
the event of bankruptcy, reorganization, or other arrangement under
the laws of bankruptcy and other laws affecting creditors' rights.

AAA Debt rated "AAA" has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.

AA Debt rated "AA" has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.

A Debt rated "A" has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB Debt rated "BBB" is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

BB, B, CCC, CC, C Debt rated "BB," "B," "CCC," "CC" and "C" is regarded, on
balance, as predominantly speculative with respect to capacity to pay interest
and repay principal. "BB" indicates the least degree of speculation and "C" the
highest. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

BB Debt rated "BB" has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or exposure to
adverse business, financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. The "BB"
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied "BBB-" rating.

B Debt rated "B" has a greater vulnerability to default but currently has
the capacity to meet interest payments and principal repayments. Adverse
business, financial, or economic conditions will likely impair capacity or
willingness to pay interest and repay principal. The "B" rating category is also
used for debt subordinated to senior debt that is assigned an actual or implied
"BB" or "BB-" rating.

CCC Debt rated "CCC" has a currently identifiable vulnerability to default
and is dependent upon favorable business, financial, and economic conditions to
meet timely payment of interest and repayment of principal. In the event of
adverse business, financial or economic conditions, it is not

<PAGE>

likely to have the capacity to pay interest and repay principal. The "CCC"
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied "B" or "B-" rating.

CC The rating "CC" typically is applied to debt subordinated to senior debt
that is assigned an actual or implied "CCC" rating.

C The rating "C" typically is applied to debt subordinated to senior debt
which is assigned an actual or implied "CCC-" debt rating. The "C" rating may be
used to cover a situation where a bankruptcy petition has been filed, but debt
service payments are continued.

CI The rating "CI" is reserved for income bonds on which no interest is
being paid.

D Debt rated "D" is in payment default. The "D" rating category is used
when interest payments or principal payments are not made on the date due even
if the applicable grace period has not expired, unless S&P believes that such
payments will be made during such grace period. The "D" rating also will be used
upon the filing of a bankruptcy petition if debt service payments are
jeopardized.

Plus (+) or Minus (-): The ratings from "AA" to "CCC" may be modified by
the addition of a plus or minus sign to show relative standing within the major
categories.

MOODY'S INVESTORS SERVICE, INC.

Aaa Bonds which are rated "Aaa" are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edged." Interest payments are protected by a large or exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.

Aa Bonds which are rated "Aa" are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities, fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long-term risk appear somewhat greater than the Aaa securities.

A Bonds which are rated "A" possess many favorable investment attributes
and are to be considered as upper-medium-grade obligations. Factors giving
security to principal and interest are considered adequate, but elements may be
present which suggest a susceptibility to impairment some time in the future.

Baa Bonds which are rated "Baa" are considered as medium-grade obligations
(i.e., they are neither highly protected nor poorly secured). Interest payments
and principal security appear adequate for the present, but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

<PAGE>

Ba Bonds which are rated "Ba" are judged to have speculative elements;
their future cannot be considered as well-assured. Often the protection of
interest and principal payments may be very moderate, and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.

B Bonds which are rated "B" generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Caa Bonds which are rated "Caa" are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.

Ca Bonds which are rated "Ca" represent obligations which are speculative
in a high degree. Such issues are often in default or have other marked
shortcomings.

C Bonds which are rated "C" are the lowest rated class of bonds, and issues
so rated can be regarded as having extremely poor prospects of ever attaining
any real investment standing.

Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating
classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.

<PAGE>

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

Financial Highlights...................................................... 4
Investment Objectives and Policies........................................ 8
How to Buy Shares......................................................... 26
How to Redeem Shares...................................................... 27
Management................................................................ 27
Determination of Net Asset Value.......................................... 29
Dividends and Other Distributions......................................... 29
Taxes..................................................................... 30
General Information....................................................... 31
Appendix A................................................................ 31

Investment Adviser Custodians
First Investors Management The Bank of New York
Company, Inc. 48 Wall Street
95 Wall Street New York, NY 10286
New York, NY 10005
Brown Brothers
Subadviser Harriman & Co.
Wellington Management 40 Water Street
Company Boston, MA 02109
75 State Street
Boston, MA 02109 Auditors
Tait, Weller & Baker
Transfer Agent Two Penn Center Plaza
Administrative Data Philadelphia, PA 19102-1707
Management Corp.
581 Main Street Legal Counsel
Woodbridge, NJ 07095-1198 Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, D.C. 20036

This Prospectus is intended to constitute an offer by Life Series Fund only of
the securities of which it is the issuer and is not intended to constitute an
offer by any Fund of the securities of any other Fund whose securities are also
offered by this Prospectus. No Fund intends to make any representation as to the
accuracy or completeness of the disclosure in this Prospectus relating to any
other Fund. No dealer, salesman or any other person has been authorized to give
any information or to make any representations other than those contained in
this Prospectus or the Statement of Additional Information, and if given or
made, such information and representation must not be relied upon as having been
authorized by Life Series Fund, First Investors Corporation, or any affiliate
thereof. This Prospectus does not constitute an offer to sell or a solicitation
of an offer to buy any of the shares offered hereby in any state to any person
to whom it is unlawful to make such offer in such state.

<PAGE>

First Investors
Life Series Fund
- -----------------------------
Blue Chip Fund
Cash Management Fund
Discovery Fund
Government Fund
Growth Fund
High Yield Fund
International Securities Fund
Investment Grade Fund
Target Maturity 2007 Fund
Target Maturity 2010 Fund
Utilities Income Fund

Prospectus

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

April 29, 1996

First Investors Logo

Logo is described as follows: the arabic numeral one separated into seven
vertical segments followed by the words "First Investors."

Verticle line from top to bottom in center of page about 1/2 inch in thickness

The following language appears to the left of the above language in the printed
piece:

FIRST INVESTORS LIFE SERIES FUND
95 WALL STREET
NEW YORK, NY 10005

First Investors Logo (as described above)
A MEMBER OF THE
FIRST INVESTORS
FINANCIAL NETWORK

LIFE325