As filed with the Securities and Exchange Commission on April 27, 2000
Registration No. 2-98410
811-4328
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Post-Effective Amendment No. 22 X
-
To
FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933
OF SECURITIES OF A UNIT INVESTMENT TRUST
REGISTERED ON FORM N-8B-2
PURSUANT TO THE INVESTMENT
COMPANY ACT OF 1940
FIRST INVESTORS LIFE LEVEL PREMIUM
VARIABLE LIFE INSURANCE
(SEPARATE ACCOUNT B)
(Name of Trust)
FIRST INVESTORS LIFE INSURANCE COMPANY
(Name of Depositor)
95 Wall Street, 22nd Floor
New York, New York 10005
(Complete address of depositor's principal
executive offices)
William H. Drinkwater
President
First Investors Life Insurance Company
95 Wall Street, 22nd Floor
New York, New York 10005
(Name and complete address of agent for service)
Copies of all communications to:
Freedman, Levy, Kroll & Simonds
1050 Connecticut Avenue
Washington, D.C. 20036-5366
Attn: Gary O. Cohen, Esq.
<PAGE>
It is proposed that this filing will become effective on (check the appropriate
box):
|_| immediately upon filing pursuant to paragraph (b)
|X| on April 28, 2000 pursuant to paragraph (b)
|_| 60 days after filing pursuant to paragraph (a)(1)
|_| on (date) pursuant to paragraph (a)(1) of Rule 485
|_| this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
Title and Amount of Securities Being Registered: An indefinite amount of units
of interest in First Investors Life Level Premium Variable Life Insurance
(Separate Account B) under variable life insurance policies.
Approximate Date of Proposed Public Offering: Continuous
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS
LIFE LEVEL PREMIUM
VARIABLE LIFE INSURANCE
RECONCILIATION AND TIE
----------------------
N-8B-2
Item No. Location
-------- --------
<S> <C>
1-8 Organization and General Front Cover; Overview, The Policy,
Information Who We Are; Other Information,
Relevance of Financial Statements
9 Material Litigation Not Applicable
10 General Information Concerning Overview, Who We Are; The Policy in
the Securities of the Trust and Detail; Other Information
the Rights of Holders
11-12 Information Concerning the Overview, Who We Are; The Policy in
Securities Underlying the Detail; Other Information
Trust's Securities
13 Information Concerning Loads, Overview, The Charges and Expenses;
Fees, Charges and Expenses The Policy in Detail, Optional
Insurance Riders
14-24 Information Concerning the Overview, Who We Are; The Policy in
Operations of the Trust Detail, Allocation of Your Net
Premium to Investment Options;
Federal Income Tax Information;
Other Information
25-27 Organization and Operations of Overview, Who We Are; Our Officers
Depositor and Directors; Other Information
28 Officials and Affiliated Persons Overview, Who We Are; Our Officers
of Depositor and Directors
30 Controlling Persons Overview, Who We Are
31-34 Compensation of Officers and Overview, Who We Are; Our Officers
Directors of Depositor and Directors; Other Information
<PAGE>
35-38 Distribution of Securities Overview, Who We Are; Other
Information, Distribution of
Policies
39-43 Information Concerning Principal Overview, Who We Are; Other
Underwriter Information, Distribution of
Policies
44-45 Offering Price or Acquisition Overview, The Charges and Expenses,
Valuation of Securities of the Who We Are; Pertinent Provisions of
Trust the Prospectus of First Investors
Life Series Fund (File No. 2-98409)
incorporated herein by reference
46 Redemption Valuation of Overview, The Charges and Expenses,
Securities of the Trust Who We Are; Pertinent Provisions of
the Prospectus of First Investors
Life Series Fund
(File No.2-98409) incorporated
herein by reference
47 Purchase and Sale of Interests Overview, The Charges and Expenses,
in Underlying Securities from Who We Are; The Policy in Detail;
and to Security Holders Other Information
48-50 Information Concerning the Other Information
Trustee or Custodian
51 Information Concerning Insurance Overview; The Policy in Detail
of Holders of Securities
52 Policy of Registrant Overview; The Policy in Detail;
Other Information
53 Regulated Investment Company Federal Income Tax Information
54-59 Financial and Statistical Overview, The Charges and Expenses;
Information The Policy in Detail; Illustrations
of Death Benefits, Cash Values and
Accumulated Premiums; Other
Information, Relevance of Financial
Statements, Experts
</TABLE>
<PAGE>
[FIRST INVESTORS LOGO]
Insured Series Plan
This booklet contains two prospectuses. The first prospectus is for our Level
Premium Variable Life Insurance Policy, which we call our Insured Series Plan
("ISP"). The second prospectus is for the First Investors Life Series Fund,
which serves as the underlying investment options for our variable life
insurance policy.
THE DATE OF THIS PROSPECTUS IS APRIL 28, 2000.
<PAGE>
CONTENTS*
LEVEL PREMIUM VARIABLE LIFE INSURANCE POLICIES PROSPECTUS
OVERVIEW.......................................................2
The Policy..................................................2
The Charges and Expenses....................................3
Who We Are..................................................5
Risk and Reward Considerations..............................6
THE POLICY IN DETAIL...........................................6
Your Premiums...............................................6
Allocation of Your Net Premium to Investment Options........7
The Death Benefit...........................................8
Your Cash Value.............................................9
Settlement Options..........................................12
Optional Insurance Riders...................................13
Other Provisions............................................14
FEDERAL INCOME TAX INFORMATION.................................16
OUR OFFICERS AND DIRECTORS.....................................19
OTHER INFORMATION..............................................21
Voting Rights...............................................21
Reservation of Rights.......................................21
Distribution of Policies....................................22
Custodian...................................................22
Reports.....................................................22
State Regulation............................................22
Experts.....................................................23
Relevance of Financial Statements...........................23
ILLUSTRATIONS OF DEATH BENEFITS,
CASH VALUES AND ACCUMULATED PREMIUMS........................23
REPORT OF CERTIFIED PUBLIC ACCOUNTANTS.........................28
FINANCIAL STATEMENTS OF FIRST INVESTORS LIFE...................29
REPORT OF CERTIFIED PUBLIC ACCOUNTANTS.........................40
FINANCIAL STATEMENTS OF SEPARATE ACCOUNT B.....................41
- -----------------------------
*A Table of Contents for the Life Series Fund prospectus can be found on page 1
of that prospectus.
<PAGE>
THE INSURED SERIES PLAN
LEVEL PREMIUM VARIABLE LIFE INSURANCE POLICIES
ISSUED BY
FIRST INVESTORS LIFE INSURANCE COMPANY
95 Wall Street, New York, New York 10005/(212) 858-8200
PLEASE READ THIS PROSPECTUS AND KEEP IT FOR FUTURE REFERENCE. IT CONTAINS
IMPORTANT INFORMATION THAT YOU SHOULD KNOW BEFORE BUYING OR TAKING ACTION UNDER
A POLICY. THIS PROSPECTUS IS VALID ONLY WHEN ATTACHED TO THE CURRENT PROSPECTUS
FOR FIRST INVESTORS LIFE SERIES FUND.
THE SECURITIES AND EXCHANGE COMMISSION (SEC) HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is April 28, 2000.
<PAGE>
OVERVIEW
THE POLICY
This Prospectus describes a Level Premium Variable Life Insurance Policy
(the "Policy") that is offered by First Investors Life Insurance Company
(referred to hereafter as "First Investors Life," "we," "us" or "our") through
our Separate Account B. The Policy provides you with life insurance coverage and
the opportunity to invest your net premiums (i.e., premiums less certain fees
and charges) in one or more investment options ("Subaccounts") of Separate
Account B. For marketing purposes, we call the Policy our Insured Series Plan.
You are required to pay premiums for only 12 years. After 12 years, you
never have to make another premium payment. The Policy stays in force for the
life of the insured unless you decide to surrender it. The premiums are level.
You decide how much you want to pay each year. Once this amount is set, you pay
the same amount each year. This amount can never be increased by us.
The Policy is "variable." This means that the amount of the insurance
coverage, the cash value and the loan value of your Policy may increase or
decrease depending on the investment performance of the Subaccount(s) that you
select. You bear the entire investment risk with respect to the Policy's cash
value, which could decline to zero. However, the death benefit will never be
less than the Guaranteed Insurance Amount (adjusted for loans and partial
surrenders), if you pay all your premiums.
We offer ten Subaccounts, from which you may select up to five. Each
Subaccount invests in shares of a corresponding "Fund" of First Investors Life
Series Fund ("Life Series Fund"), as shown below.
SEPARATE ACCOUNT CORRESPONDING
B SUBACCOUNT FUND
---------------- ------
Blue Chip Subaccount Blue Chip Fund
Cash Management Subaccount Cash Management Fund
Discovery Subaccount Discovery Fund
Focused Equity Subaccount Focused Equity 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
For information on the investment objectives, investment strategies, and
investment risks of each Fund, see the Life Series Fund prospectus, which is
attached at the end of this prospectus.
You may also choose to add riders to your Policy to increase the death
benefit and protect against the risk that you will not be able to make the
premium payments due to your own death or disability. These optional riders are
described in the section called "Optional Insurance Riders."
To help you understand how the values of a hypothetical Policy would change
over time, we have included some hypothetical illustrations based on certain
assumptions we have made. Because your circumstances may vary considerably from
our assumptions, your registered representative will also provide you with a
similar hypothetical illustration that is more tailored to your own
circumstances and wishes. You should keep in mind that replacing existing
insurance with the Policy may not benefit you because of, among other things,
the cost of the Policy during the first few years.
If you are not satisfied with your Policy, you may be able to cancel and
return it to us for a full refund of any premiums that you have paid. For more
details, see the section entitled "Cancellation Rights" in this prospectus.
2
<PAGE>
THE CHARGES AND EXPENSES
We describe below the fees and charges that you may be required to pay to
purchase and maintain the Policy. Immediately thereafter, we describe the fees
and expenses of each of the underlying mutual funds that are available as
investment options. We guarantee that once you have purchased your policy, we
will not increase the amount of your premium payments, the charges that we
deduct from your premiums, or the charges that we deduct from your Subaccount(s)
for mortality and expense risks.
Deductions from Premium Payments
--------------------------------
We deduct from your premiums for the Policy the fees and charges listed
below. We allocate the balance of your premium payments to the Subaccount(s)
that you have selected.
Annual Administrative Charge. We impose a $30 charge on your premium payment
each Policy year. The charge is for our annual administrative expenses,
including expenses for (1) premium billing and collection, (2) recordkeeping,
(3) processing death benefit claims, (4) cash surrenders, (5) Policy changes,
and (6) reporting and other communications to Policyowners.
Additional First Year Charge. We impose an additional charge in the first
Policy year at the rate of $5 per $1,000 of initial face amount of insurance.
The charge is for our administrative expenses in issuing the Policy, including
expenses for (1) medical examinations, (2) insurance underwriting costs, and (3)
processing applications and establishing permanent Policy records.
Sales Load. We impose a sales charge in issuing a Policy. The charge in any
year does not specifically correspond to our sales expenses for that year. The
charge will not exceed the following percentages of the annual premium:
Years Maximum Percentages
----- -------------------
1...............................30%
2-4..............................10%
5 and later...........................6%
Premiums For Optional Insurance Riders. We will deduct from your premiums
any premiums for any optional insurance riders that you have chosen.
State Premium Tax Charge. This charge is 2% of the premium. Premium taxes
vary from state to state. Two percent (2%) is the average rate we expect to pay.
Risk Charge. We impose a maximum risk charge of 1.5% of the premium. The
charge insures that the death benefit will always at least equal the guaranteed
minimum death benefit.
Other Charges. We may also deduct two other charges from your premium: (1)
an extra premium if you are rated as having a high mortality risk, and (2) an
additional charge for premiums if you pay premiums on other than an annual
basis.
We begin to accrue and deduct all of the above charges on a Policy's issue
date. For the fiscal year ended December 31, 1999, we received a total of
$9,792,586 for these charges.
Deductions from the Value of Your Policy
----------------------------------------
Mortality And Expense Risks Charges. We deduct from the value of your Policy
a daily charge for the mortality and expense risks that we assume. We compute
the charge at an effective annual rate of .50% of the value of Subaccount assets
attributable to your Policy.
3
<PAGE>
The mortality risk that we assume is that the person named as the insured
under the Policy will live for a shorter time than we have estimated. In that
case, we will not receive enough premium to compensate us for the death benefit
we must pay. The expense risk we assume is that the expenses we incur in issuing
and administering the Policies will be greater than we have estimated.
Cost Of Insurance Protection. We deduct a charge for the cost of insurance
protection. This amount is determined by the insurance rates applicable to your
Policy based upon your age, sex, and other factors as well as the net amount of
insurance that is at risk (see "Deduction of Cost of Insurance Protection from
Cash Value").
Charges For Income Taxes. We do not currently charge for our corporate
Federal income taxes that may be attributable to Separate Account B. However, we
may impose such a charge in the future. We may also impose charges for other
applicable taxes attributable to Separate Account B (see "FEDERAL INCOME TAX
INFORMATION").
Expenses Paid by the Funds
--------------------------
The Funds of Life Series Fund (singularly, "Fund," and collectively,
"Funds") bear the cost of investment advisory and subadvisory fees, brokerage
commissions, transfer taxes and other fees related to securities transactions.
While you will not be required to pay any such expenses directly, they are
indirectly passed on to you. They are reflected in the net asset value of each
Fund's shares.
The following table shows the fees and expenses for each Fund that is available
to you:
FUND ANNUAL EXPENSES
(AS A PERCENTAGE OF FUND AVERAGE NET ASSETS)
<TABLE>
<CAPTION>
TOTAL FUND FEE WAIVERS
MANAGEMENT OTHER OPERATING AND/OR EXPENSE NET
FEES(1) EXPENSES(2) EXPENSES(3) ASSUMPTION(1),(2) EXPENSES(3)
------- ----------- ----------- ----------------- -----------
<S> <C> <C> <C> <C> <C>
Blue Chip Fund 0.75% 0.06% 0.81% N/A N/A
Cash Management Fund 0.75% 0.16% 0.91% 0.21% 0.70%
Discovery Fund 0.75% 0.08% 0.83% N/A N/A
Focused Equity Fund 0.75% 0.08% 0.83% N/A N/A
Government Fund 0.75% 0.16% 0.91% 0.15% 0.76%
Growth Fund 0.75% 0.06% 0.81% N/A N/A
High Yield Fund 0.75% 0.07% 0.82% N/A N/A
International Securities Fund 0.75% 0.23% 0.98% N/A N/A
Investment Grade Fund 0.75% 0.08% 0.83% 0.15% 0.68%
Utilities Income Fund 0.75% 0.05% 0.80% N/A N/A
</TABLE>
(1) For the fiscal year ended December 31, 1999, the Adviser waived Management
Fees in excess of 0.60% for Cash Management Fund, in excess of 0.60% for
Government Fund, in excess of 0.60% for Investment Grade Fund, and in
excess of 0.60% for Utilities Income Fund. The Adviser has contractually
agreed with Life Series Fund to waive Management Fees in excess of 0.60%
for Cash Management Fund, in excess of 0.60% for Government Fund, and in
excess of 0.60% for Investment Grade Fund for the fiscal year ending
December 31, 2000.
(2) For the fiscal year ended December 31, 1999, the Adviser assumed certain
Other Expenses in excess of 0.10% for Cash Management. The Adviser has
contractually agreed with Life Series Fund to assume Other Expenses in
excess of 0.10% for Cash Management Fund for the fiscal year ending
December 31, 2000.
(3) Each Fund, other than International Securities Fund, has an expense offset
arrangement that may reduce the Fund's custodian fee based on the amount of
cash maintained by the Fund with its custodian. Any such fee reductions are
not reflected under Total Fund Operating Expenses or Net Expenses.
4
<PAGE>
WHO WE ARE
First Investors Life
--------------------
First Investors Life, 95 Wall Street, New York, New York 10005 , is a stock
life insurance company incorporated under the laws of the State of New York in
1962. We write life insurance, annuities, and accident and health insurance. We
assume all of the insurance risks under the Policy, and our assets support the
Policy's benefits. At December 31, 1999, we had over $1.267 billion of assets
and over $3.505 billion of life insurance in force. (See First Investors Life's
financial statements under "Financial Statements.")
First Investors Consolidated Corporation ("FICC") owns all of the
outstanding stock of First Investors Life, First Investors Corporation ("FIC"),
the underwriter of the policies sold by First Investors Life, and Administrative
Data Management Corp., the transfer agent for Life Series Fund ("Transfer
Agent"). FICC also owns all of the voting common stock of First Investors
Management Company, Inc. ("FIMCO"), the adviser of the Life Series Fund. Mr.
Glenn O. Head controls FICC and, therefore, controls First Investors Life and
the other companies which are owned by FICC.
We segregate the assets of Separate Account B from our other assets. The
assets fall into two categories: (1) assets equal to our reserves and other
liabilities under the Policies and (2) additional assets derived from expenses
that we charge to Separate Account B. The assets equal to our Policy reserves
and liabilities support the Policy. We cannot use these assets to satisfy any of
our other liabilities. The assets derived from our charges do not support the
Policy, and we can transfer these assets in cash to our General Account. Before
making a transfer, we will consider any possible adverse impact that the
transfer may have on Separate Account B.
Separate Account B
------------------
We established Separate Account B on June 4, 1985 under the provisions of
the New York Insurance Law. Separate Account B is a separate investment account.
Separate Account B has registered with the SEC as a unit investment trust under
the 1940 Act.
We allocate assets to Separate Account B to support the benefits under the
Policy. The assets are in turn invested by each Subaccount of Separate Account B
into a corresponding Fund at net asset value. Each Subaccount reinvests any
distributions it receives from a Fund by purchasing additional shares of the
distributing Fund at net asset value. Accordingly, we do not expect to pay you
any capital distributions from the Policies. We value shares of the Funds that
the Subaccounts hold at their net asset values.
Life Series Fund
----------------
Life Series Fund is an open-end management investment company registered
under the 1940 Act. Life Series Fund consists of 13 separate Funds, ten of which
are available to Policyowners of Separate Account B. Target Maturity 2007 Fund,
Target Maturity 2010 Fund and Target Maturity 2015 Fund are the three Funds of
Life Series Fund that are not available to Policyowners of Separate Account B.
The Life Series Fund offers its shares only through the purchase of a Policy or
a variable annuity contract. It does not offer its shares directly to the
general public.
FIMCO is the investment adviser of each Fund. The Adviser is a New York
Corporation located at 95 Wall Street, New York, New York 10005. FIMCO and Life
Series Fund have retained Wellington Management Company, 75 State Street,
Boston, Massachusetts 02109 to serve as subadviser ("WMC" or "Subadviser") of
the International Securities Fund and the Growth Fund, and Arnhold and S.
Bleichroeder, Inc., 1345 Avenue of the Americas, New York, New York 10105 ("ASB"
or Subadviser") to serve as the subadviser of the Focused Equity Fund. See the
Life Series Fund Prospectus for more information about the Adviser and
Subadvisers.
5
<PAGE>
RISK AND REWARD CONSIDERATIONS
------------------------------
The Policy offers you not only insurance protection but also the
opportunity to accumulate assets on a tax deferred basis by investing in the
underlying investment options. However, there are several important factors that
you should consider before making a decision to purchase a Policy.
1. The Policy involves a long-term commitment on your part. Because most
of the fees and charges are paid during the early years, you will generally lose
money if you fail to make all premium payments required during the 12 year
period. This is illustrated in the hypotheticals that appear at the end of this
prospectus. Therefore, you should have the intention and financial ability to
make all the required premium payments.
2. With investment opportunity comes investment risk. Each Subaccount will
fluctuate in value on a daily basis. The investment objectives, primary
investment strategies, and primary risks of the underlying Funds are described
in the attached Life Series prospectus.
3. If you decide to take policy loans, you should be aware that they can
have adverse consequences. Among other things, they reduce the death benefit and
cash value of your Policy; they may undermine the growth potential of the cash
value of your Policy; and they may result in taxable distributions to you if
they exceed the cash value of a Policy as a result of a decline in the market
value of the underlying investments or for any other reason (see the discussion
on Policy Loans).
4. A surrender of your Policy prior to maturity may have tax implications.
You should carefully review the section on "FEDERAL INCOME TAX INFORMATION."
THE POLICY IN DETAIL
The following discussion summarizes important provisions of the Policy
offered by this Prospectus. The discussion generally assumes 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.
YOUR PREMIUMS
The Amount of Your Premiums
---------------------------
Subject to our $600 minimum annual premium requirement (which does not
include additional premiums for any riders that you may select other than Waiver
of Premium), you decide how much you wish to pay in premiums. Once you have
decided how much you wish to pay, the premium remains level for all 12 years
that you are required to make premium payments. We can never increase the
amount. We allocate assets to our General Account to accumulate as a reserve for
the contingency that the insured will die when the Guaranteed Insurance Amount
exceeds the death benefit payable without such guarantee. In setting premium
rates, we took into consideration actuarial estimates of projected death and
surrender benefit payments, lapses, expenses, investment returns, and a
contribution to our surplus.
6
<PAGE>
The Frequency Of Payment
- ------------------------
You pay premiums under the Policy for only 12 years. You may choose to pay
these premiums on an annual, semi-annual, quarterly or monthly due date measured
from the date of issue of the Policy. Premium payments are due on or before the
due dates at our Home Office. If you pay early, we will place your premium
payment in our General Account and, on the day that it is due, we will allocate
the premium to the Subaccount(s) that you selected.
You will pay the lowest premium by paying annually. When you pay premiums 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 following table illustrates these premium amounts. We
deduct the additional charge from these premiums when we receive them.
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 the pre-authorized monthly plan ("Lifeline"), your bank automatically
makes an electronic funds transfer to us from your bank account to pay your
premiums.
Automatic Premium Loans to Pay Premiums
---------------------------------------
Under the Automatic Premium Loan provision, you pay any premium not paid
before the end of the grace period (see definition in "Other Provisions") by an
automatic loan against the Policy. The Automatic Premium Loan provision is
available only if:
o you elect the Automatic Premium Loan provision in your application for
the Policy or in a written request that we receive at our Home Office at
any time when no premium is in default, and
o the resulting Policy loan and loan interest to the next premium due date
do not exceed the maximum loan value of your Policy (see "Policy Loans").
You may revoke the Automatic Premium Loan Provision at any time by written
request that we receive at our Home Office.
ALLOCATION OF YOUR NET PREMIUMS TO INVESTMENT OPTIONS
When you purchase a Policy, you select the allocation of the net premium
(premium less deductions) (see "The Charges And Expenses--Deductions from
Premium Payments") to not more than five of the Subaccounts of Separate Account
B. You must allocate at least 10% of the net premium to each Subaccount you
select. The actual allocation of net premium occurs on the Policy's issue date
and at the beginning of each Policy year after that.
We offer ten Subaccounts, from which you may select up to five. Each
Subaccount in turn invests in the corresponding Fund of Life Series Fund. For
information on the investment objectives, investment strategies, and investment
risks of the Funds, see the Life Series Fund prospectus which is attached at the
end of this prospectus.
7
<PAGE>
While your premium will never increase, the net amount which is invested in
the subaccounts you select will increase over time, as charges and expenses
decline. Thus, as time goes by, more of your premium will be invested. As an
example, based on the Policies illustrated on page 25 through 27, we would
allocate to the selected Subaccount(s) the following amounts for each Policy
year:
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
- --------- ------------- ------------- -------------
1........................ $170.81 $ 508.46 $ 927.23
2-4...................... 489.00 1,008.00 1,527.00
5 and later.............. 513.00 1,056.00 1,599.00
THE DEATH BENEFIT
The death benefit is the amount we pay to your named beneficiary at the
death of the person whom you name as the insured. It is the sum of the
Guaranteed Insurance Amount (face amount of the Policy) plus, if positive, a
Variable Insurance Amount that is based upon the performance of the Subaccounts
that you have selected. We increase the death benefit to reflect (1) any
insurance on the life of the insured that you may have added by rider and (2)
any premium you have paid that applies to a period of time after the Insured's
death. We reduce the death benefit to reflect (1) any Policy loan and loan
interest and (2) any unpaid premium that applies to a period before the
insured's death.
Generally, we pay the death benefit within seven days after we receive all
claim requirements at our Home Office located at 95 Wall Street, New York, NY
10005. We pay interest on death benefit proceeds from the date of death until we
pay the death benefit. We pay this interest at the same annual rate that we pay
on death benefit proceeds you leave on deposit with us under a Settlement
Option. We may pay interest at a higher rate if the law requires.
The Guaranteed Insurance Amount
-------------------------------
We guarantee that the death benefit on your policy will never be less than
the Policy's face amount, which is the Guaranteed Insurance 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, we determine the death benefit on each Policy anniversary by adding
the Variable Insurance Amount, if positive, to the Guaranteed Insurance Amount.
The death benefit then 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 Variable Insurance Amount is based upon the investment results of the
Subaccounts that you have selected. During the first Policy year, the Variable
Insurance Amount is zero. On the first Policy anniversary, and on each
anniversary thereafter, we determine your Variable Insurance Amount by comparing
the Actual Rate of Return (the gross rate of return less all fees and charges)
on your Subaccounts with an assumed rate of return of 4%, which we call the
"Base Rate of Return."
Your Variable Insurance Amount does not change if the Actual Rate of Return
on all of your Subaccounts is exactly equal to the Base Rate of Return. Your
Variable Insurance Amount increases if the Actual Rate of Return is greater than
the Base Rate of Return. The Variable Insurance Amount decreases if the Actual
Rate of Return is less than the Base Rate of Return. The difference between
these rates of return, if any, is called the Differential Rate of Return. We set
the Variable Insurance Amount on each Policy anniversary and do not change it
until the next Policy anniversary.
8
<PAGE>
The amount by which your Variable Insurance Amount will increase or decrease
during any policy year is determined by dividing the Differential Investment
Return (the Differential Rate of Return times the Investment Base) for a policy
year by the applicable net single premium rate that is specified in your Policy.
Your policy includes a table of the applicable net single premium rates per
$1.00 from ages 0 to 99. The net single premium increases as the Insured grows
older, meaning that the Insured will receive less Variable Insurance per dollar
of Differential Investment Return as the Insured grows older. The net single
premium 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 that we issue to a female than for a Policy that we issue to
a male of the same age.
The Variable Insurance Amount is calculated on a cumulative basis. This
means that the amount reflects the accumulation of increases and decreases from
past Policy years. The cumulative amount may be positive or negative, depending
on the investment performance, while the Policy is in force, of the Subaccounts
that you have selected. If the Variable Insurance Amount is negative, the death
benefit is the Guaranteed Insurance Amount. In other words, the death benefit is
never less than the Guaranteed Insurance Amount.
The following example illustrates how the Variable Insurance Amount is
calculated. For this example, we use the Policy illustration on page 26 for a
male age 25, and assume a 12% hypothetical gross annual investment return
(equivalent to an Actual Rate of Return of approximately .103823). The
calculations are for policy years 6 and 12:
CALCULATION OF CHANGE IN
VARIABLE INSURANCE
AMOUNT AT END OF POLICY YEAR
6 12
----------------------------
(1) Cash Value at End of Prior Year........ $5,535.00 $18,327.00
(2) Net Premium............................ 1,056.00 1,056.00
(3) Investment Base at Beginning of
Current Policy Year: (1)+(2)........... 6,591.00 19,383.00
(4) Differential Rate of Return
(.103823 - .04)........................ .063823 .063823
(5) Differential Investment Return: (3)x(4) $420.66 $1,237.08
(6) Net Single Premium at
End of Current Year.................... 0.22416 0.27338
(7) Change in Variable Insurance
Amount (to nearest dollar):
(5)(divided by)(6).................... $1,877 $4,525
If the hypothetical gross annual investment return in the year illustrated
had been 0% (equivalent to an Actual Rate of Return of approximately -1.445%),
the results in the calculation above would have been as follows: the death
benefit would have decreased by $1,601, and the death benefit for the end of
Policy year 6 would have been $54,393.
YOUR CASH VALUE
Determining Your Cash Value
---------------------------
The cash value you have in your Policy will vary daily depending on the
investment experience of the Subaccounts you have selected. (See "Valuation of
Assets.") The cash value on any day within the policy year equals the cash value
as of the end of the prior Policy year, plus the premiums that you have paid
since the Policy's last anniversary, adjusted to reflect the Actual Rates of
Return of the Subaccounts you have selected, less the cost of insurance
protection.
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Assuming no partial surrenders or Policy Loans have been taken, the
following example illustrates how the cash value of a Policy at the end of any
year is calculated. For this example, we use the Policy illustration for a male
issue age 25 on Page 26, and we assume a 12% hypothetical gross annual
investment return (equivalent to an Actual Rate of Return of approximately
10.3823%). The "Investment Base" is the value of your investments on all
Subaccounts you have selected. In this case, the cash value we show for the end
of Policy year 5 increases to the amount we show for the end of Policy year 6
for the Policy, as follows:
(1) Cash Value at End of Prior Year..................... $5,535
(2) Net Premium Paid by You............................. 1,056
(3) Investment Base at Beginning of Current Policy
Year 6: (1)+(2)..................................... 6,591
(4) Actual Rate of Return................................ .103823
(5) Investment Return: (3)x(4)........................... 684
(6) Benefit Base at End of Policy Year 6: (3)+(5)........ 7,275
(7) Cost of Insurance Protection During Policy Year 6.... (88)
(8) Cash Value at End of Policy Year 6: (6)-(7).......... 7,187
We do not guarantee that you will have any cash value in your Policy. The
Policy offers the possibility of increased cash value resulting from good
investment performance. However, there is no assurance that any increase 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.
In that case, we would credit subsequent net premium payments and investment
returns against the negative cash value. You bear all the investment risk.
Deduction of Cost of Insurance Protection from Cash Value
---------------------------------------------------------
Your cash value is reduced by an annual charge for the cost of insurance
protection. We issue variable life insurance policies to (1) persons with
standard mortality risks and (2) persons with higher mortality risks, as our
underwriting rules permit. We charge a higher gross premium for the person with
the higher mortality risk.
We currently use the 1980 Commissioners' Standard Ordinary Mortality Table
to compute the cost of insurance protection for each Policy, with one exception.
For mortality rates for extended term insurance, we use the Commissioners' 1980
Extended Term Table. For Policies issued prior to 1989, we use the 1958
Commissioners' Standard Ordinary Mortality Table to compute the cost of
insurance protection for each Policy and the Commissioners' 1958 Extended Term
Table for mortality rates for extended term insurance.
In all cases, we base the cost of insurance protection on the net amount of
insurance at risk (the Policy's face amount, plus the Variable Insurance Amount,
minus the cash value) and the person's sex and attained age. The amount that we
deduct each year is different, because the probability of death generally
increases as a person's age increases. The net amount of insurance at risk may
decrease or increase each year depending on the investment experience of the
Subaccount(s) that you have selected.
Accessing Your Cash Value
-------------------------
FULL OR PARTIAL SURRENDERS. You may surrender the Policy for its cash
value at any time while the Insured is living. The amount payable will be the
cash value that we next compute after we receive the surrender request at our
Home Office. Surrender will be effective on the date that we receive both the
Policy and a written request in a form acceptable to us.
On any Policy anniversary, you may also make a partial surrender of the
Policy by reducing the premium amount. We permit a partial surrender only if you
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(1) have no outstanding policy loan and (2) have paid the new premium due on the
Policy anniversary.
We must receive all requirements for a partial surrender at our Home Office
on or before the Policy anniversary. The partial surrender will be effective on
the Policy anniversary. The amounts of the Guaranteed Insurance Amount (face
amount of the Policy), death benefit, and cash value for the reduced Policy will
be the same as they would have been had you paid the reduced premium from
inception. We will pay the portion of the cash value of the original Policy that
exceeds the cash value of the reduced Policy to you as a partial surrender. We
will allocate the cash value of the reduced Policy among the Subaccounts in the
same proportion as the allocation of the cash value of the original Policy.
We will usually pay the surrender value within seven days. However, we may
delay payment for the following reasons:
o a recent payment that you made by check has not yet cleared the bank,
o we are not able to determine the amount of the payment because the New
York Stock Exchange is closed for trading or the Commission determines
that a state of emergency exists, or
o for such other periods as the Commission may by order permit for the
protection of security holders.
We will pay interest if we delay payment of the surrender value beyond seven
days. Under Federal tax laws, we may deduct withholding taxes from the surrender
value.
POLICY LOANS. You 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, if you assign your Policy to us as sole security. We charge interest
daily at an effective annual rate of 6% compounded on each Policy anniversary.
In general, we send the loan amount within seven days of receipt of the request.
We will not permit a new loan unless it is at least $100, or unless you use it
to pay premiums. You may repay all or a portion of any loan and accrued interest
while the Insured is living and the Policy is in force.
When you take out a loan, we transfer a portion of the cash value equal to
the loan from the Subaccount(s) that you have selected to our General Account.
We charge the loan to each Subaccount in the proportion which the value of each
Subaccount bears to the cash value of the Policy as of the date of the loan. A
Policy loan does not affect the amount of the premiums due. A Policy loan does,
however, reduce the death benefit and cash value by the amount of the loan. A
Policy loan may also permanently affect the death benefit above the Guaranteed
Insurance Amount and the cash value, whether or not you repay the loan in whole
or in part. This occurs because we will not credit Net Investment Return that
the Subaccount(s) earn to the amount that we maintain in the General Account
during the period that the loan is outstanding. Instead, we credit the amount in
the General Account at the assumed interest rate of 4%, in accordance with the
tabular cash value calculations that we have filed with the state insurance
departments.
A Policy loan will have a negative impact on the growth of the cash value
during periods when the actual rates of return of the Subaccounts you have
selected exceed the assumed rate of 4%. 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 Insurance Amount" and "The Variable
Insurance Amount"). The cash value and the Variable Insurance Amount, if any,
depend on the Actual Rate of Return of the Subaccount(s). Thus, during periods
of favorable investment return (an Actual Rate of Return greater than 4%), an
outstanding Policy loan results in lower investment return than would have
otherwise resulted in the absence of any indebtedness.
11
<PAGE>
For example, use the Policy for a male issue age 25 illustrated on Page 26,
and assume a hypothetical 12% gross annual investment return and that you made a
$3,000 Policy loan at the end of Policy year 9. For the end of Policy year 10,
the death benefit and cash value would be $68,747 and $15,462, respectively. The
differences between these amounts and the $69,495 death benefit and $15,653 cash
value that appear on Page 26 for Policy year 10 result because the portion of
the cash value equal to the indebtedness does not reflect the Subaccount(s)'
Actual Rate of Return of approximately 10.3823%.
Conversely, outstanding indebtedness will diminish the adverse effect on
cash value during a period of unfavorable investment return (an Actual Rate of
Return less than 4%). This is because the portion of the cash value that we
transfer from the Subaccount(s) to the General Account will grow at the assumed
rate of 4% even if Actual Rates of Return are below 4%. Thus, a Policy loan will
tend to protect the cash value and Variable Insurance Amount from decreasing if
the Actual Rate of Return is less than 4%.
If you do not pay loan interest when it is due, we increase your loan by the
amount of any unpaid interest, and we transfer an equivalent amount of cash
value from the Subaccount(s) to the General Account. We credit loan repayments
to each Subaccount in proportion to your allocation to each Subaccount as of the
date of repayment.
We subtract the amount of any outstanding loan plus interest from any death
benefit or any surrender value that we pay. If your outstanding loan with
accrued interest ever equals or exceeds the cash value, we will mail notice of
such event to you and any assignee at the assignee's last known address. The
Policy terminates 31 days after we mail such notice. The Policy does not
terminate if you make a repayment within that 31-day period.
Generally, on a Policy's termination or surrender, you pay income tax on the
following:
o the surrender value, plus
o any outstanding Policy loan plus interest, if applicable, minus
o the total premiums that you paid on the Policy.
Consult with your representative or tax adviser before taking Policy loans.
Transferring Your Cash Value Among Investment Options
-----------------------------------------------------
Twice each Policy year, you may transfer part or all of your cash value from
each Subaccount that you have selected to any other Subaccount or Subaccounts.
You may make these transfers only if
o you allocate the cash value to no more than five of the Subaccounts, and
o the allocation to any one Subaccount is not less than 10% of the cash
value.
SETTLEMENT OPTIONS
You or your named beneficiary may receive a single sum payment of Policy
proceeds on the death of the Insured or surrender of the Policy. Alternately,
you or your beneficiary may elect to apply all or a portion of the proceeds
under any one of the fixed benefit settlement options that the Policy provides.
Tax consequences may vary depending on the settlement option that the recipient
chooses. The options are as follows:
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<PAGE>
PROCEEDS LEFT AT INTEREST - Proceeds left on deposit with us to accumulate,
with interest payable at a rate of 2 1/2% per year, which may be increased by
additional interest.
PAYMENT OF A DESIGNATED AMOUNT - Payments in installments until proceeds
applied under the option and interest on unpaid balance at a rate of 2 1/2% per
year and any additional interest are exhausted.
PAYMENT FOR A DESIGNATED NUMBER OF YEARS - Payments in installments for up
to 25 years, including interest at a rate of 2 1/2% per year. Payments may
increase by additional interest, which we would pay at the end of each
installment year.
LIFE INCOME, GUARANTEED PERIOD - Payments guaranteed for 10 or 20 years, as
you elect, and for life thereafter. During the guaranteed period of 10 or 20
years, the payments may be increased by additional interest, which we would pay
at the end of each installment year.
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, never to
be less than the proceeds applied.
LIFE INCOME ONLY - Payments made only while the person on whom the payments
are based is alive.
OPTIONAL INSURANCE RIDERS
The following optional provisions may be included in a Policy, in States
where available, subject to the payment of an additional premium, certain age
and insurance underwriting requirements, and the restrictions and limitations
that apply to the Policy, as described above.
Accidental Death Benefit
------------------------
You may elect to obtain an Accidental Death Benefit rider if the Insured's
age is 0 to 60. The rider provides for an additional fixed amount of death
benefit in the event the Insured dies from accidental bodily injury while the
Policy is in force and before the Policy anniversary when the Insured attains
age 70. The premium is $1.75 per $1,000 of benefit and is payable for 12 years.
The amount of the benefit is equal to the face amount of the Policy, but cannot
exceed an amount equal to $200,000 minus the sum of the Insured's Accidental
Death Benefit coverage in all companies.
12 Year Level Term Rider
------------------------
You may elect to obtain a 12 Year Level Term Insurance rider where the
Insured is age 18 to 58 for an amount equal to (1) the Policy face amount or (2)
two times the Policy face amount. The rider is convertible, without evidence of
insurability, to a new Policy or other permanent plan of insurance. The amount
of the insurance under the new Policy may be any amount up to the face amount of
the rider. The conversion may occur at any time during the 12 years of rider
coverage, but not later than the Policy anniversary when the Insured reaches age
65.
Waiver Of Premium
-----------------
You can choose to obtain a Waiver of Premium rider where the Insured is age
15 to 55. Under the rider, the Company will waive all premiums falling due after
the date of commencement of the disability and for as long as the disability
continues. Disability, for this purpose, means the Insured's total disability
(1) commencing before the Policy anniversary when the Insured reaches age 60 and
(2) continuing for six months.
Payor Benefit
-------------
You can also choose to obtain a Payor Benefit rider where the Insured is age
0 to 14 and you are age 18 to 55. It provides insurance on the life of the
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<PAGE>
person who is responsible for paying the premiums. If you die or become disabled
before reaching age 60 and before the Insured is age 21, the Company waives all
premiums that become due before the Insured's age 21.
OTHER PROVISIONS
Age And Sex
-----------
If you have misstated the age or sex of the Insured, the benefits available
under the Policy are those that the premiums paid would have purchased for the
correct age and sex.
Assignment
----------
You may transfer ownership of your Policy from yourself to someone else.
However, the assignment is not binding on us, unless it is in writing and filed
with us at our Home Office. We assume no responsibility for the validity or
sufficiency of any assignment. Unless otherwise provided in the assignment, the
interest of any revocable beneficiary is subordinate to the interest of any
assignee, regardless of when you made the assignment. The assignee receives any
sum payable to the extent of his or her interest.
Beneficiary
-----------
This is the person you designate in the Policy to receive death benefits
upon the death of the Insured. You may change this designation, during the
Insured's lifetime, by filing a written request with our Home Office in a form
acceptable to us.
Cancellation Rights
-------------------
You have a limited right to cancel and return the Policy to us, or our
representative through whom you bought the Policy. You must submit a written
request for cancellation. You may examine and return the Policy within ten days
after you receive the Policy or notice of right of withdrawal. You may also
return the Policy within 45 days after completion of Part I of the application
for the Policy. In either case, you obtain a full refund of the premiums that
you paid.
Default And Options On Lapse
----------------------------
A premium is in default if you do not pay it on or before its due date. The
insurance continues in force during the 31-day grace period (see "Grace Period"
below). However, if the Insured dies during the grace period, we deduct from the
death benefit the portion of the premium applicable to the period from the
premium due date to the end of the Policy month in which death occurs.
We apply the Policy's cash value minus any loan and interest to purchase
continued insurance, if you do not surrender a Policy within 60 days after the
date of default. You may choose either reduced paid-up whole life insurance or
extended term insurance for the continued insurance. Under the Policy, you
automatically have the extended term insurance if you make no choice. However,
that option is available only in standard risk cases. If we rated the Policy for
extra mortality risks, the paid-up insurance is 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 is the amount
that the surrender value purchases on the date the option becomes effective. The
extended term insurance option provides a fixed and level amount of term
insurance equal to the death benefit (minus any indebtedness) as of the date the
option becomes effective. The insurance coverage under this option continues for
as long a period as the surrender value on such date purchases.
14
<PAGE>
For example, use the Policy for a male issue age 25 illustrated on Page 26
and assume the 0% and 12% 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% 12%
------ -------
Cash Value...................... $ 3,992 $ 5,535
Reduced Paid-up Insurance....... 18,406 25,521
for life for life
Extended Term Insurance......... 51,908 55,994
for 25 years for 29 years
You may surrender a Policy continued under either option for its cash value
while the Insured is living. You may make a loan under the reduced paid-up whole
life insurance option, but not under the extended term insurance option.
Exchange Privilege
------------------
The exchange privilege allows you to exchange the Policy for a permanent
fixed life insurance policy on the Insured's life. The exchange privilege is
available:
o within the first 24 months after the issue Policy's date, if you have
duly paid all premiums, or
o if any Fund changes its investment adviser or makes a material change in
its investment objectives or restrictions.
You do not need to provide evidence of insurability to exercise this
privilege. The new policy has a level face amount equal to the face amount of
the Policy. It also has the same benefit riders, issue dates, and risk
classification for the Insured as the Policy does. We base premiums for the new
policy on the premium rates for the new policy that were in effect on the Policy
date. You may elect either a continuous-premium policy or a limited-payment
policy for your exchanged policy.
In some cases, we may adjust the cash on exchange. The adjustment equals the
Policy's surrender value minus the new policy's tabular cash value. If the
result is positive, we pay that amount to you. If the result is negative, you
pay that amount to us. We will determine the amount of a cash adjustment as of
the date we receive the Policy and written request at our Home Office.
If we do not issue a Policy for any reason, we refund to the applicant the
amount of the premium without interest.
Grace Period
------------
With the exception of the first premium, we allow a Grace Period of 31 days
for payment of each premium after it is due. The Policy continues in force
during the Grace Period unless you surrender it.
Incontestability
----------------
Except for nonpayment of premiums, we do not contest the validity of the
Policy and its riders after it has been in force during the lifetime of the
Insured for two years from the Date of Issue.
Payment and Deferment
---------------------
We will usually pay the death benefit, surrender value, or loan proceeds
within seven days after we receive all documents required for such payments.
However, we may delay payment if (1) a recent payment by check has not yet
cleared the bank, (2) we cannot determine the amount because the New York Stock
15
<PAGE>
Exchange is closed for trading, or (3) the Commission determines that a state of
emergency exists.
Under a Policy continued as paid-up or extended term insurance, we may defer
the payment of the surrender value or loan proceeds for up to six months. If we
postpone the payment more than 30 days, we will pay interest at a rate of not
less than 3% per year on the Surrender Value. We will pay the interest from the
date of surrender to the date we make payment.
Payment of Dividends
--------------------
The Policies do not provide for dividend payments. Therefore, they are
"non-participating" in the earnings of First Investors Life.
Policy Years and Anniversaries
------------------------------
We measure Policy years and anniversaries from the Date of Issue of the
Policy which will generally be the date on which we approve the application. The
Date of Issue may be backdated on your request to save age. However, the Date of
Issue cannot be earlier than either (1) the date you sign the application or (2)
a date 15 days before the date on which we approve the application. Each Policy
year will commence on the anniversary of the Date of Issue.
Reinstatement
-------------
You may reinstate a Policy that you did not surrender for its cash value
within five years from the date of default, in accordance with the Policy. To
reinstate, you must present evidence of insurability acceptable to us, and you
must pay to us the greater of:
(1)(a) all premiums from the date of default with interest to the date of
reinstatement, plus (b) any Policy debt (plus interest to the date of
reinstatement) in effect when you continued the Policy as paid up
insurance or extended term insurance; or
(2) 110% of the increase in cash value resulting from reinstatement.
To reinstate, you must also pay us any Policy debt that arose after the
continuation of the Policy as paid up insurance. We calculate interest on any
such debt at the rate of 6% per year compounded annually.
Suicide
-------
If the Insured commits suicide within two years from the Policy's date of
issue, our liability under the Policy is limited to all premiums paid less any
indebtedness.
Valuation Of Assets
-------------------
We determine the value of the assets of each Subaccount as of the close of
business on each business day. We value shares of the underlying Fund at the net
asset value per share as determined by the Fund. The Fund determines the net
asset value of a Fund's share as described in Life Series Fund's Prospectus.
FEDERAL INCOME TAX INFORMATION
We base this discussion on current federal income tax law and
interpretations. It assumes that the policyowner is a natural person who is a
U.S. citizen and U.S. resident. The tax effect on a corporate taxpayers,
non-U.S. citizens, and non-U.S. residents may be different. The law and
interpretations could change, possibly retroactively. The discussion is general
in nature. We do not intend it as tax advice, for which you should consult a
qualified tax adviser.
16
<PAGE>
We believe that the Policy qualifies as a life insurance contract for
federal income tax purposes because the Policy meets the definition of life
insurance in Section 7702(a) of the Internal Revenue Code of 1986, as amended
(the "Code") and the investments of the Subaccounts satisfy the investment
diversification requirements of Section 817(h) of the Code. Consequently:
o the death benefit will not be subject to federal income tax;
o you will generally not be taxed on the growth of the cash value of the
Policy, if any, that is attributable to the investments in the underlying
investment portfolios (this is known as the "inside build-up"), unless or
until there is a full or partial surrender of the Policy; and
o transfers among the investment subaccounts will not be subject to federal
income tax, unless or until there is a full or partial surrender of the
Policy.
Qualification as a life insurance contract for Federal income tax purposes
depends, in part, upon the satisfaction by the Subaccounts of Separate Account B
of certain investment diversification requirements in Section 817(h) of the
Code. We expect that the Adviser will continue to manage the assets of the Funds
in a manner that complies with these diversification requirements. A Policy that
invests in a Fund that fails to meet diversification requirements will not
receive tax treatment as a life insurance contract for the period of such
diversification failure, and any subsequent period.
The Treasury Department has stated that it may issue guidelines that limit a
Policyowner's control of investments underlying a variable life insurance
policy. If a Policy failed to meet those guidelines, you would be taxed on the
Policy's current income. The Treasury Department has said informally that those
guidelines may limit the number of investment funds and the frequency of
transfers among those funds. The issuance of such guidelines may require us to
limit your right to control the investment. The guidelines may apply only
prospectively, although they could apply retroactively if they do not reflect a
new Treasury Department position.
We do not believe that any Policy will be a "modified endowment contract" at
issuance, within the meaning of Section 7702A of the Code. A modified endowment
contract is a life insurance policy under which the total premiums paid, at any
time during the first seven years of the policy, exceed the premiums that would
have been paid by that time under a similar fixed-benefit life insurance policy
designed to provide for paid-up future benefits after the payment of seven equal
annual premiums. This is called the "seven-pay" test.
Whenever there is a "material change" under a Policy, the Policy is
generally subject to a new seven-pay test during the next seven years to
determine whether it is a modified endowment contract. A material change for
these purposes could occur because of a change in death benefit, and because of
certain other changes.
If your Policy's benefits are reduced during its first seven years (or
within seven years after issuance or a material change), we will redetermine the
seven-pay test based on the reduced level of benefits and apply the new test to
all prior premium payments. Such a reduction in benefits could include a
decrease in face amount, a partial surrender, or a termination of additional
benefits under a rider. If the premiums that you previously paid are at any time
greater than the recalculated limit under the seven-pay test, we will treat the
Policy as a modified endowment contract from that time forward.
A Policy that you receive in exchange for a modified endowment contract will
also be a modified endowment contract.
Any distribution from a Policy that is a modified endowment contract will be
taxed on an "income-first" basis. A distribution, for this purpose, includes a
loan or surrender. "Income first" means that the distribution is taxed to the
17
<PAGE>
extent that your cash value exceeds your basis in the Policy (premiums paid less
previous distributions that were not taxable). Premiums paid, for this purpose,
include loans that have been taxable as income because of the Policy's modified
endowment contract status. An additional 10% tax will also be imposed on any
amount so taxed, subject to certain exceptions for distributions:
o before you reach age 59-1/2,
o in case of disability as defined in the Code, or
o received as part of a series of substantially equal periodic payments for
the life (or life expectancy) of the taxpayer or the joint lives (or
joint life expectancies) of the taxpayer and his or her beneficiary.
All modified endowment contracts that we (or our affiliates) issue to you
during any calendar year generally will be treated as one Policy under the
modified endowment contract rules. You should consult your tax adviser if you
have questions regarding the possible impact of the modified endowment contract
rules on your Policy.
If a Policy is not a modified endowment contract, Policy loans will be
treated as indebtedness, and no part of such loans will be subject to current
federal income tax. In addition, the interest on such loans generally will not
be deductible. If you surrender your Policy while a loan is outstanding, the
amount of the loan will be treated as a partial surrender. You should be aware
that if the cash value of your Policy falls below the aggregate amount of loans
outstanding, as the result of the fluctuation in the value of the underlying
portfolios or otherwise, the entire Policy may terminate. In that case, all
loans will be taxable to the extent they exceed premiums paid.
If you make a partial surrender after the first 15 Policy years, the
distribution will not be subject to federal income tax except to the extent that
it exceeds your basis in the Policy. During the first 15 Policy years, however,
the proceeds from a partial withdrawal could be subject to federal income tax,
under a complex formula, to the extent that your cash value exceeds your basis.
Upon surrender of a Policy, taxation of the Surrender Value depends on the
Payment Option that you have selected. If payment is in one sum, you are taxed
on the income in the Policy at the time payment is made. If payment is in
installments, you may be taxed:
o on all or a portion of each installment until the income in the Policy
has been paid,
o only after all your basis in the Policy has been paid, or
o on a portion of each payment.
You should consult your tax adviser if you have questions about the taxation
of a Policy surrender.
Under the Code, we must generally withhold income tax from the taxable
portion of the distribution that we pay upon surrender of a Policy. We will not
withhold, if you so request in writing, before the payment date. Failure to
withhold or withholding of an insufficient amount may subject you to taxation.
In addition, insufficient withholding and insufficient estimated tax payments
may subject you to penalties.
The Life Series Fund sells its shares to more than one separate account
funding variable annuity contracts or variable life insurance policies.
Consequently, violation of the Federal tax laws by another separate account
investing in Life Series Fund could cause the Policies funded through Separate
Account B to lose their tax-deferred status. Such a result might cause us to
take remedial action.
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<PAGE>
We are taxed as a "life insurance company" under Subchapter L of the Code.
Under the applicable provisions of the Code, we include our variable life
insurance operations in our Federal income tax return. Currently, we do not make
any charge against the Subaccount(s) for our Federal income taxes attributable
to the Subaccount(s). However, we may make such charges in the future. Any such
charges against a Subaccount would reduce its Net Investment Return.
Under current laws, we may incur state and local taxes (in addition to
premium taxes) in several states. At present, these taxes are not significant.
If we make any tax charges in the future, we will accumulate them daily and
transfer them from the Subaccount(s) to our General Account. We will retain any
investment earnings on tax charges accumulated in the Subaccount(s).
OUR OFFICERS AND DIRECTORS
NAME OFFICE PRINCIPAL OCCUPATION FOR LAST FIVE YEARS
- ---- ------ ----------------------------------------
Dori Allen Associate Associate Counsel, First Investors Life since
Counsel May 1998; Staff Attorney since February 1997;
and Staff Supervisor, Toxic Tort Unit, Claims
Attorney Administration Corporation, New York,
prior thereto.
Jay G. Baris Director Partner, Kramer Levin Naftalis & Frankel LLP,
New York, Attorneys; Secretary and Counsel,
First Financial Savings Bank, S.L.A., New
Jersey.
Carol Lerner Secretary Assistant Secretary, FIC; Secretary, FIMCO
Brown and FICC.
Glenn T. Dallas Director Retired since April 1996; Division President
and Senior Vice President, ADT Security
Systems, Parsippany, New Jersey, prior
thereto.
William H. Director President since January 2000, First Investors
Drinkwater and Life; First Vice President and Chief Actuary,
President First Investors Life, prior thereto.
Lawrence M. Senior Senior Vice President and Comptroller, First
Falcon Vice Investors Life.
President
and
Comptroller
Richard H. Director Consultant since January 2000; President,
Gaebler First Investors Life, prior thereto.
Glenn O. Head Chairman Chairman and Director, FICC, FIMCO and FIC.
and
Director
Kathryn S. Head Director President and Director, FICC and FIMCO; Vice
President and Director, FIC; Chairman and
Director, First Financial Savings Bank,
S.L.A.
19
<PAGE>
OUR OFFICERS AND DIRECTORS
NAME OFFICE PRINCIPAL OCCUPATION FOR LAST FIVE YEARS
- ---- ------ ----------------------------------------
Scott Hodes Director Partner, Ross & Hardies, Chicago, Illinois,
Attorneys.
William M. Vice Chief Financial Officer, FIC since December
Lipkus President 1997, FICC since June 1997; Vice President,
and Chief First Investors Life since May 1996; Chief
Financial Financial Officer since May 1998; Chief
Officer Accounting Officer since June 1992.
Joseph J. Rao Actuary Actuary, First Investors Life since October
1999; Associate Actuary, New York Life from
October 1998 to October 1999; Assistant Vice
President and Actuary, Mutual Life of New
York, prior thereto.
Jackson Ream Director Retired since January 1999; Senior Vice
President, NationsBank, NA, Dallas, Texas
prior thereto.
Nelson Director Partner, Weiss, Peck & Greer, New York,
Schaenen Jr. Investment Managers.
Karen T. Assistant Assistant Vice President since May 1999;
Slattery Vice Senior Underwriter, First Investors Life,
President prior thereto
Martin A. Smith Vice Vice President, First Investors Life since
President February 1998; Vice President, The United
States Life Insurance Company, New York,
prior thereto.
Ada M. Suchow Vice Vice President, First Investors Life.
President
John T. Director Director, FIMCO and FIC; Of Counsel to
Sullivan Hawkins, Delafield & Wood, New York,
Attorneys.
Clark D. Wagner Director Chief Investment Officer, FIMCO and Executive
Investors Management Company, Inc.; Vice
President, First Investors Multi-State
Insured Tax Free Fund, First Investors New
York Insured Tax Free Fund, Inc., Executive
Investors Trust, First Investors Government
Fund, Inc., First Investors Series Fund and
First Investors Insured Tax Exempt Fund, Inc.
Gulf Insurance Company has issued a fidelity bond for $5,000,000 covering
our officers and employees. Great American Insurance Companies has issued a
directors and officers liability policy for $3,000,000 covering our directors
and officers.
In addition to Separate Account B, First Investors Life also maintains First
Investors Life Variable Annuity Fund A, First Investors Life Variable Annuity
Fund C and First Investors Life Variable Annuity Fund D. We offer variable
annuity contracts supported by Variable Annuity Fund A through its own
prospectus and by Variable Annuity Funds C and D through a combined prospectus.
20
<PAGE>
OTHER INFORMATION
VOTING RIGHTS
Because the Life Series Fund is not required to have annual shareholder
meetings, policyowners generally will not have an occasion to vote on matters
that pertain to the Life Series Fund. In certain circumstances, the Fund may be
required to hold a shareholders meeting or may choose to hold one voluntarily.
For example, a Fund may not change fundamental investment objectives or
investment policies without the approval of a majority vote of that Fund's
shareholders in accordance with the 1940 Act. Thus, if the Fund sought to change
a fundamental investment objective or policy, policyowners would have an
opportunity to provide voting instructions for shares of a Fund held by a
Subaccount in which their Policy invests.
We will vote the shares of any Fund held in a corresponding Subaccount or
directly, at any Fund shareholders meeting as follows:
o shares attributable to Policyowners for which we have received
instructions, in accordance with the instructions;
o shares attributable to Policyowners for which we have not received
instructions, in the same proportion that we voted shares held in the
Subaccount for which we received instructions; and
o shares not attributable to Policyowners, in the same proportion that we
have voted shares held in the Subaccount attributable to Policyowners
for which we have received instructions.
We will vote Fund shares that we hold directly in the same proportion that
we vote shares held in any corresponding Subaccounts that are attributable to
Policyowners and for which we receive instructions. However, we will vote our
own shares as we deem appropriate where there are no shares held in any
Subaccount. We will present all the shares of any Fund that we hold through a
Subaccount or directly at any Fund shareholders meeting for purposes of
determining a quorum.
We will determine the number of Fund shares held in a corresponding
Subaccount that is attributable to each Policyowner by dividing the value of the
Subaccount by the net asset value of one Fund share. We will determine the
number of votes that a Policyowner has the right to cast as of the record date
established by Life Series Fund.
We will solicit instructions by written communication before the date of the
meeting at which votes will be cast. We will send meeting and other materials
relating to the Fund to each Policyowner having a voting interest in a
Subaccount.
The voting rights that we describe in this Prospectus are created under
applicable laws. If the laws 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, we reserve the right to proceed in
accordance with any such changed laws or regulations. We specifically reserve
the right to vote shares of any Fund in our own right, to the extent permitted
by law.
RESERVATION OF RIGHTS
We also reserve the following rights, subject to compliance with applicable
law, including any required approval of Policyowners:
o to invest the assets of Separate Account B in the shares of any
investment company or series thereof or any investment permitted by law;
21
<PAGE>
o to transfer assets from Separate Account B to another separate account,
with appropriate adjustments to avoid odd lots and fractions;
o to operate Separate Account B as a "management company" under the 1940
Act, or in any other form permitted by law (we or our affiliate would
serve as investment adviser);
o to deregister Separate Account B under the 1940 Act; and
o to operate Separate Account B under the general supervision of a
committee any or all of whose members may be interested persons
(as defined in the 1940 Act) of First Investors Life or an affiliate, or
to discharge the committee.
DISTRIBUTION OF POLICIES
We sell the Policies solely through individuals who, in addition to being
licensed insurance agents of First Investors Life, are registered
representatives of FIC, which is an affiliate of First Investors Life. FIC is a
registered broker-dealer under the Securities Exchange Act of 1934, and a member
of the National Association of Securities Dealers. FIC's executive offices are
located at 95 Wall Street, New York, NY 10005. We pay these agents a commission
of 28.55% of the first year premium payment and 1% of the premium payments for
years 2 through 12. For the fiscal years ended December 31, 1997, 1998 and 1999,
FIC received fees of $4,487,918, $5,121,393 and $5,555,910, respectively, in
connection with the distribution of Policies in a continuous offering. First
Investors Life has reserved the right to sell the Policies directly.
We offer the Policies for sale in Alabama, Alaska, Arizona, Arkansas,
California, Colorado, Connecticut, Delaware, District of Columbia, Florida,
Georgia, Iowa, Illinois, Indiana, Kentucky, Louisiana, Maine, Massachusetts,
Maryland, Michigan, Minnesota, Missouri, Mississippi, Nebraska, Nevada, New
Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon,
Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia,
Washington, West Virginia, Wisconsin and Wyoming.
CUSTODIAN
Subject to applicable laws and regulations, we are the custodian of the
securities of the Subaccounts. We maintain the records and accounts of Separate
Account B.
REPORTS
At least once each Policy year, we mail a report to the Policyowner within
31 days after the Policy anniversary. We mail the report to the last address
known to us. The report shows (1) the death benefit, (2) the cash value, (3) the
policy debt on the anniversary and (4) any loan interest for the prior year. The
report also shows your allocation among the Subaccounts on that anniversary. We
will not send a report if the Policy is continued as reduced paid-up or extended
term insurance.
STATE REGULATION
We are subject to the laws of the State of New York governing insurance
companies and to regulations of the New York State Insurance Department. We file
an annual statement in a prescribed form with the Department of Insurance each
year covering our operations for the preceding year and our financial condition
as of the end of such year.
Our books and accounts are subject to review by the Insurance Department at
any time. The Department conducts a full examination of our operations
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, we are subject
to regulation under the insurance laws of other jurisdictions in which we may
operate.
22
<PAGE>
EXPERTS
Tait, Weller & Baker, independent certified public accountants have examined
the financial statements included in this Prospectus. We include the financial
statements in reliance upon the authority of said firm as experts in accounting
and auditing.
RELEVANCE OF FINANCIAL STATEMENTS
You should consider our financial statements, which appear in this
Prospectus, only as bearing on our ability to meet our obligations to
Policyowners under the Policies. You should not consider our financial
statements as bearing on the investment performance of the Subaccount(s). Only
the investment results of the Subaccount(s) affect the values of Policyowner
interests under the Policies.
ILLUSTRATIONS OF DEATH BENEFITS,
CASH VALUES AND ACCUMULATED PREMIUMS
The tables on Pages 25 to 27 illustrate the way the Policy operates. They
show how the death benefit and the cash value may vary over an extended period
of years. The tables are based on assumed annual premiums of $600 for a 10 year
old male, $1,200 for a 25 year old male, and $1,800 for a 40 year old male. The
tables assume that premiums are paid in one lump sum promptly at the beginning
of each year. The tables assume a standard risk classification. The tables
assumes that each Subaccount will experience hypothetical rates of investment
return (I.E., investment income and capital gains and losses, realized or
unrealized) equivalent to constant hypothetical gross annual investment returns
of 0%, 6% and 12%.
The death benefit and cash value for the Policy would be different from those
shown:
o if you spread the payment of premiums over the year, or
o if the gross annual rates of return applicable to the Policy average 0%,
6%, and 12% over a period of years, but nevertheless fluctuate above or
below that average for individual Policy years.
The cash values and death benefits shown in the illustrations assume the
deduction of all fees and charges. When we take all fees and charges into
account, the hypothetical gross annual investment returns of 0%, 6%, and 12%
correspond to Actual Rates of Return of approximately -1.445%, 4.4687%, and
10.3823%, respectively.
For purposes of the illustration, we have assumed:
o a daily charge to the Subaccount(s) for mortality and expense risks
equivalent to an annual charge of 0.50% at the beginning of each year,
o a premium tax of 2.00% on each premium payment,
o an investment advisory fee of 0.75% of each Fund's average daily net
assets, and
o other expenses of 0.20% of each Fund's average daily net assets.
The assumed other expenses of 0.20% exceed the average of the actual other
expenses of all of the Funds combined. Certain of the Funds had actual expenses
greater than 0.20%. As of December 31, 1999, International Securities Fund had
23
<PAGE>
other expenses of 0.23%.
The tables also reflect that we currently make no charge to the
Subaccount(s) for our corporate Federal income taxes. However, we may make such
charges in the future. If we do, a Policy would need higher hypothetical gross
annual investment returns greater than 0%, 6%, and 12% to produce, on an after
tax basis, the results shown.
We have included a column captioned "Total Premiums Paid Plus Interest at
5%" in each table to show you the amount that would accumulate if the annual
premium (gross amount) that you allocated to the Subaccounts earned interest,
after taxes, at 5% compounded annually.
----------------------
We will furnish, upon request, a comparable illustration using the proposed
Insured's age and the face amount or premium amount that you request. The
illustration will assume that you pay premiums on an annual basis and that the
proposed Insured is a standard risk. In addition, we will include a comparable
illustration, reflecting the Insured's risk classification if other than
standard, at the delivery of the Policy, if you make a purchase.
24
<PAGE>
<TABLE>
<CAPTION>
MALE ISSUE AGE 10
$600 ANNUAL PREMIUM FOR STANDARD RISK
$39,638 FACE AMOUNT (GUARANTEED INSURANCE AMOUNT)
TOTAL DEATH BENEFIT CASH VALUES
END OF PREMIUMS ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
POLICY PREMIUM PAID PLUS ANNUAL RATES OF RETURN OF ANNUAL RATES OF RETURN OF
YEAR DUE INTEREST AT 5% 0% 6% 12% 0% 6% 12%
- --------- --------- -------------- ---------------------------- ---------------------------
<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
The hypothetical gross annual rates of return shown in the illustration and elsewhere in the
prospectus are illustrative only and are not representations of past or future rates of return. The
cash values and death benefits shown in the illustration assume the deduction of all fees and
charges and that no Policy Loans have been taken. Actual rates may be higher or lower than
hypothetical rates and will depend on a number of factors, including the investment allocations made
by a policy owner, the frequency of premium payments chosen and the investment experience of the
Policy's Subaccounts. The death benefits and cash values would be different from those shown if the
average of the actual gross annual rates of return over a period of years equaled those shown, but
the rates varied from year to year. They would also be different if any Policy Loan were made during
the period. No representations can be made that those hypothetical rates of return can be achieved
for any one year or sustained over any period of time.
</TABLE>
25
<PAGE>
<TABLE>
<CAPTION>
MALE ISSUE AGE 25
$1,200 ANNUAL PREMIUM FOR STANDARD RISK
$51,908 FACE AMOUNT (GUARANTEED INSURANCE AMOUNT)
TOTAL DEATH BENEFIT CASH VALUES
END OF PREMIUMS ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
POLICY PREMIUM PAID PLUS ANNUAL RATES OF RETURN OF ANNUAL RATES OF 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
The hypothetical gross annual rates of return shown in the illustration and elsewhere in the
prospectus are illustrative only and are not representations of past or future rates of return. The
cash values and death benefits shown in the illustration assume the deduction of all fees and
charges and that no Policy Loans have been taken. Actual rates may be higher or lower than
hypothetical rates and will depend on a number of factors, including the investment allocations made
by a policy owner, the frequency of premium payments chosen and the investment experience of the
Policy's Subaccounts. The death benefits and cash values would be different from those shown if the
average of the actual gross annual rates of return over a period of years equaled those shown, but
the rates varied from year to year. They would also be different if any Policy Loan were made during
the period. No representations can be made that those hypothetical rates of return can be achieved
for any one year or sustained over any period of time.
</TABLE>
26
<PAGE>
<TABLE>
<CAPTION>
MALE ISSUE AGE 40
$1,800 ANNUAL PREMIUM FOR STANDARD RISK
$47,954 FACE AMOUNT (GUARANTEED INSURANCE AMOUNT)
TOTAL DEATH BENEFIT CASH VALUES
END OF PREMIUMS ASSUMING HYPOTHETICAL GROSS ASSUMING HYPOTHETICAL GROSS
POLICY PREMIUM PAID PLUS ANNUAL RATES OF RETURN OF ANNUAL RATES OF 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
The hypothetical gross annual rates of return shown in the illustration and elsewhere in the
prospectus are illustrative only and are not representations of past or future rates of return. The
cash values and death benefits shown in the illustration assume the deduction of all fees and
charges and that no Policy Loans have been taken. Actual rates may be higher or lower than
hypothetical rates and will depend on a number of factors, including the investment allocations made
by a policy owner, the frequency of premium payments chosen and the investment experience of the
Policy's Subaccounts. The death benefits and cash values would be different from those shown if the
average of the actual gross annual rates of return over a period of years equaled those shown, but
the rates varied from year to year. They would also be different if any Policy Loan were made during
the period. No representations can be made that those hypothetical rates of return can be achieved
for any one year or sustained over any period of time.
</TABLE>
27
<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, 1999 and 1998, and the related statements
of income, stockholder's equity and cash flows for each of the three years in
the period ended December 31, 1999. 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, 1999 and 1998, and the results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1999, in conformity with generally accepted accounting principles.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
February 18, 2000
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS LIFE INSURANCE COMPANY
BALANCE SHEET
ASSETS
DECEMBER 31, 1999 DECEMBER 31, 1998
----------------- -----------------
<S> <C> <C>
Investments (note 2):
Available-for-sale securities....................................... $109,081,845 $131,031,939
Held-to-maturity securities......................................... 31,147,991 5,491,598
Short term investments.............................................. 4,179,510 3,982,209
Policy loans........................................................ 28,640,385 24,961,708
---------------- --------------
Total investments................................................ 173,049,731 165,467,454
Cash ................................................................. (729,147) 113,094
Premiums and other receivables, net of allowances of
$30,000 in 1999 and 1998............................................ 6,391,696 6,297,635
Accrued investment income............................................. 3,204,950 3,473,067
Deferred policy acquisition costs (note 6)............................ 24,607,577 20,873,233
Deferred Federal income taxes (note 7) ........................... 1,868,000 473,000
Furniture, fixtures and equipment, at cost, less accumulated
depreciation of $1,169,049 in 1999 and $1,110,857 in 1998........... 57,966 102,448
Other assets.......................................................... 118,396 82,822
Separate account assets............................................... 1,058,703,230 821,105,059
--------------- -------------
Total assets..................................................... $1,267,272,399 $1,017,987,812
============== ==============
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Policyholder account balances (note 6)................................ $123,677,096 $118,786,854
Claims and other contract liabilities................................. 14,870,396 13,934,636
Accounts payable and accrued liabilities.............................. 3,573,113 3,796,503
Separate account liabilities.......................................... 1,058,229,265 821,105,059
-------------- -------------
Total liabilities................................................ 1,200,349,870 957,623,052
-------------- -------------
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
Accumulated other comprehensive income (note 2)....................... (908,000) 2,193,000
Retained earnings .................................................... 58,796,186 49,137,417
---------------- -------------
Total stockholder's equity....................................... 66,922,529 60,364,760
---------------- -------------
Total liabilities and stockholder's equity....................... $1,267,272,399 $1,017,987,812
============== ==============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENT OF INCOME
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31,1998 DECEMBER 31,1997
----------------- ---------------- ----------------
<S> <C> <C> <C>
REVENUES
Policyholder fees................................... $26,171,703 $25,393,372 $24,826,454
Premiums............................................ 5,656,183 6,091,731 6,279,137
Investment income (note 2).......................... 11,049,520 10,501,572 10,259,601
Realized gain (loss) on investments................. (1,190,548) 914,891 158,874
Other income........................................ 818,604 893,181 702,644
-------------- ------------- -------------
Total income..................................... 42,505,462 43,794,747 42,226,710
------------ ----------- -----------
BENEFITS AND EXPENSES
Benefits and increases in contract liabilities...... 10,571,181 13,803,921 14,370,510
Dividends to policyholders.......................... 1,390,300 1,749,579 1,033,663
Amortization of deferred acquisition costs (note 6). 969,205 1,005,483 663,200
Commissions and general expenses.................... 14,848,007 15,553,605 15,445,888
------------ ----------- -----------
Total benefits and expenses...................... 27,778,693 32,112,588 31,513,261
------------ ------------ -----------
Income before Federal income tax ..................... 14,726,769 11,682,159 10,713,449
Federal income tax (note 7):
Current............................................. 4,865,000 3,682,000 4,285,000
Deferred............................................ 203,000 265,000 (603,000)
----------- ------------ -----------
5,068,000 3,947,000 3,682,000
------------ ------------ -----------
Net Income............................................ $ 9,658,769 $ 7,735,159 $ 7,031,449
============ ============ ===========
Income per share, based on 534,350 shares outstanding
$18.08 $14.48 $13.16
============ ============= ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENT OF STOCKHOLDER'S EQUITY
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31,1999 DECEMBER 31,1998 DECEMBER 31, 1997
---------------- ---------------- -----------------
<S> <C> <C> <C>
Balance at beginning of year............................. $60,364,760 $ 52,044,601 $ 44,049,152
----------- ------------ ------------
Net income............................................... 9,658,769 7,735,159 7,031,449
Other comprehensive income
Increase (decrease) in unrealized holding gains on
available-for-sale securities.......................... (3,101,000) 585,000 964,000
------------- -------------- --------------
Comprehensive income..................................... 6,557,769 8,320,159 7,995,449
------------- -------------- --------------
Balance at end of year................................... $ 66,922,529 $ 60,364,760 $ 52,044,601
============ ============ ============
STATEMENT OF CASH FLOWS
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31,1997
----------------- ----------------- ----------------
Increase (decrease) in cash:
Cash flows from operating activities:
Policyholder fees received..........................$ 25,827,717 $ 25,010,611 $ 24,587,113
Premiums received................................... 5,931,178 5,433,211 6,088,582
Amounts received on policyholder accounts........... 124,375,574 132,528,386 125,818,334
Investment income received.......................... 11,726,193 10,630,564 10,263,095
Other receipts...................................... 73,652 91,864 57,287
Benefits and contract liabilities paid.............. (129,416,853) (142,124,914) (138,420,373)
Commissions and general expenses paid............... (24,060,176) (24,138,476) (20,899,476)
------------- -------------- --------------
Net cash provided by operating activities........... 14,457,285 7,431,246 7,494,562
-------------- -------------- --------------
Cash flows from investing activities:
Proceeds from sale of investment securities......... 47,855,224 42,655,632 38,900,851
Purchase of investment securities................... (58,962,363) (47,605,879) (44,021,791)
Purchase of furniture, equipment and other assets... (13,710) (79,322) (62,170)
Net increase in policy loans........................ (3,678,677) (3,433,898) (2,662,162)
Investment in Separate Account ..................... (500,000) 100 593,945
-------------- -------------- ------------
Net cash used for investing activities.............. (15,299,526) (8,463,367) (7,251,327)
-------------- -------------- -------------
Net increase (decrease) in cash..................... (842,241) (1,032,121) 243,235
Cash
Beginning of year ..................................... 113,094 1,145,215 901,980
------------- ------------- ----------
End of year ...........................................$ (729,147) $ 113,094 $ 1,145,215
============= ============= ==============
The Company received a refund of Federal income tax of $79,000 in 1997 and paid Federal income tax
of $5,075,000 in 1999, $4,400,000 in 1998 and $4,358,000 in 1997.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS LIFE INSURANCE COMPANY
STATEMENT OF CASH FLOWS
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31, 1997
----------------- ----------------- -----------------
<S> <C> <C> <C>
Reconciliation of net income to net cash
provided by operating activities:
Net income........................................ $ 9,658,769 $ 7,735,159 $ 7,031,449
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.................. 66,281 82,342 117,804
Amortization of deferred policy acquisition costs 969,205 1,005,483 663,200
Realized investment (gains) losses............. 1,190,548 (914,891) (158,874)
Amortization of premiums and discounts on
investments.................................. 408,556 421,135 280,852
Deferred Federal income taxes.................. 203,000 265,000 (603,000)
Other items not requiring cash - net........... 25,470 (660) 9,771
(Increase) decrease in:
Premiums and other receivables, net............ (94,061) (1,548,536) (750,889)
Accrued investment income...................... 268,117 (292,143) (277,358)
Deferred policy acquisition costs, exclusive
of amortization.............................. (3,797,549) (3,613,000) (1,866,787)
Other assets................................... (43,663) 29,133 9,323
Increase (decrease) in:
Policyholder account balances.................. 4,890,242 3,505,536 1,985,844
Claims and other contract liabilities.......... 935,760 1,386,540 357,815
Accounts payable and accrued liabilities....... (223,390) (629,852) 695,412
------------ ------------ ------------
$ 14,457,285 $ 7,431,246 $ 7,494,562
============ =========== ===========
See accompanying notes to financial statements.
</TABLE>
<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 over three
to seven years.
(c) INVESTMENTS. Investments in equity securities that have readily
determinable fair values and all investments in debt securities are classified
in separate categories and accounted for as follows:
HELD-TO-MATURITY SECURITIES
Debt securities in which the Company has the positive intent and
ability to hold to maturity are recorded at amortized cost.
AVAILABLE-FOR-SALE SECURITIES
Debt securities not classified as held to maturity securities and
equity securities are recorded at fair value with unrealized gains and
losses excluded from earnings and reported as "accumulated other
comprehensive income" in stockholder's equity.
Short term investments are reported at market value which approximates
cost.
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 31,1999 DECEMBER 31, 1998 DECEMBER 31,1997
---------------- ----------------- ----------------
<S> <C> <C> <C>
Interest on fixed maturities............................. $ 9,589,859 $ 9,276,036 $ 9,029,979
Interest on short term investments....................... 243,945 226,544 307,656
Interest on policy loans................................. 1,714,441 1,465,497 1,268,834
------------ ------------- ------------
Total investment income............................. 11,548,245 10,968,077 10,606,469
Investment expense.................................. 498,725 466,505 346,868
-------------- ------------- -------------
Net investment income.................................... $11,049,520 $ 10,501,572 $ 10,259,601
=========== ============ ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The amortized cost and estimated market values of investments at December 31, 1999 and 1998 are as
follows:
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED MARKET
COST GAINS LOSSES VALUE
---- ----- ------ -----
<S> <C> <C> <C> <C>
AVAILABLE-FOR-SALE SECURITIES
DECEMBER 31, 1999
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies............................... $ 35,374,157 $ -- $ 297,674 $ 35,076,483
Debt Securities issued by
States of the U.S.......................... 984,941 -- 78,161 906,780
Corporate Debt Securities................... 69,097,105 209,641 1,899,219 67,407,527
Other Debt Securities ...................... 5,966,094 -- 275,039 5,691,055
-------------- ------------- ------------- ---------------
$111,422,297 $ 209,641 $ 2,550,093 $109,081,845
============ ========== ============ ============
DECEMBER 31,1998
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies............................... $ 28,353,391 $ 1,703,441 $ 912 $ 30,055,920
Debt Securities issued by
States of the U.S.......................... 13,964,587 261,109 8,696 14,217,000
Corporate Debt Securities................... 77,938,088 2,148,113 378,682 79,707,519
Other Debt Securities....................... 6,676,873 374,627 -- 7,051,500
-------------- ------------- -------------- ---------------
$126,932,939 $ 4,487,290 $ 388,290 $131,031,939
============ =========== ============ ============
</TABLE>
At December 31, 1999 and 1998, the Company had "Unrealized Holding Gains
(Losses) on Available-For-Sale Securities" of ($908,000) and $2,193,000, net of
applicable deferred income taxes and amortization of deferred acquisition costs.
The change in the Unrealized Holding Gains (Losses) of ($3,101,000), $585,000
and $964,000 for 1999, 1998 and 1997, respectively is reported as other
comprehensive income in stockholders' equity. During the year ended December 31,
1999, the Company reclassified certain investments from Available-For-Sale
securities to Held-To-Maturity securities. In connection with the
reclassification, $834,455 of unrealized gains on such securities are included
in Accumulated Other Comprehensive Income in Stockholder's Equity and is being
amortized over the remaining life of the securities as an adjustment to yield.
<TABLE>
<CAPTION>
HELD-TO-MATURITY SECURITIES
DECEMBER 31,1999
<S> <C> <C> <C> <C>
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies*.............................. $ 3,336,121 $ 68,367 $ 7,222 $ 3,397,266
Debt Securities issued by
States of the U.S.......................... 15,578,482 -- 1,896,633 13,681,849
Corporate Debt Securities................... 7,171,138 -- 755,842 6,415,296
Other Debt Securities....................... 5,062,250 -- 632,074 4,430,176
-------------- -------------- ---------- ------------
$ 31,147,991 $ 68,367 $ 3,291,771 $ 27,924,587
============= =========== =========== ============
DECEMBER 31,1998
U.S. Treasury Securities and obligations
of U.S. Government Corporations
and Agencies*.............................. $ 3,381,598 $ 223,647 $ -- $ 3,605,245
Corporate Debt Securities................... 2,000,000 125,400 -- 2,125,400
Other Debt Securities....................... 110,000 -- -- 110,000
-------------- ------------ --------- -------------
$ 5,491,598 $ 349,047 $ -- $ 5,840,645
============ ========= =========== ===========
</TABLE>
*These securities are on deposit for various state insurance departments and are
therefore restricted as to sale.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The amortized cost and estimated market value of debt securities at
December 31, 1999, 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.......................$ 100,000 $ 100,000 $ 9,263,507 $ 9,067,102
Due after one year through five years......... 3,346,121 3,407,266 23,841,639 23,782,165
Due after five years through ten years........ 1,098,443 979,037 41,461,579 40,105,851
Due after ten years........................... 26,603,427 23,438,284 36,855,572 36,126,727
------------ ------------ --------------- --------------
$31,147,991 $27,924,587 $111,422,297 $109,081,845
=========== =========== ============ ============
</TABLE>
Proceeds from sales of investments in fixed maturities were $47,855,224,
$42,655,632 and $38,900,851 in 1999, 1998 and 1997, respectively. Gross gains of
$422,254 and gross losses of $1,612,802 were realized on those sales in 1999.
Gross gains of $977,442 and gross losses of $62,551 were realized on those sales
in 1998. Gross gains of $374,583 and gross losses of $215,709 were realized on
those sales in 1997.
(d) RECOGNITION OF REVENUE, POLICYHOLDER ACCOUNT BALANCES AND POLICY
BENEFITS
TRADITIONAL ORDINARY LIFE AND HEALTH
Revenues from the traditional life insurance policies represent
premiums that 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.
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.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(f) COMPREHENSIVE INCOME. For 1998, the Company adopted Statement of
Financial Accounting Standards No, 130 ("SFAS 130"), "Reporting Comprehensive
Income". SFAS 130 establishes the disclosure requirements for reporting
comprehensive income in an entity's financial statements. Total comprehensive
income includes net income and unrealized gains and losses on available-for-sale
securities. Accumulated other comprehensive income, a component of stockholders'
equity, was formerly reported as unrealized gains and losses on
available-for-sale securities. There was no impact on previously reported net
income from the adoption of SFAS 130.
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 maturity 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 participates in a non-contributory profit sharing plan for the
benefit of its employees and those of other wholly-owned subsidiaries of its
parent. The Plan provides for retirement benefits based upon earnings. Vesting
of benefits is based upon years of service. For the years ended December 31,
1999, 1998 and 1997, the Company charged operations approximately $74,000,
$79,000 and $70,000 respectively for its portion of the contribution.
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
$478,000 in 1999, $475,000 in 1998 and $419,000 in 1997. The accrued liability
of approximately $3,406,000 in 1999 and $3,251,000 in 1998 was sufficient to
cover the value of benefits provided by the plan.
In addition, the Company participates in a 401(k) savings plan covering all
of its eligible employees and those of other wholly-owned subsidiaries of its
parent whereby employees may voluntarily contribute a percentage of their
compensation with the Company matching a portion of the contributions of certain
employees. Contributions to this plan were not material.
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 that any reinsurance company may be unable to meet.
The Company had reinsured approximately 10% of its net life insurance in force
at December 31, 1999, 1998 and 1997. The Company also had assumed reinsurance
amounting to approximately 19%, 20% and 20% 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.
<PAGE>
FIRST INVESTORS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(b) The Company and certain affiliates share office space, data processing
facilities and management personnel. Charges for these services are based upon
the Company's proportionate share of: space occupied, usage of data processing
facilities and time allocated to management. During the years ended December 31,
1999, 1998 and 1997, the Company paid approximately $1,610,000, $1,440,000 and
$1,114,000, respectively, for these services. In addition, the Company
reimbursed an affiliate approximately $10,501,000 in 1999, $10,799,000 in
1998,and $9,814,000 in 1997 for commissions relating to the sale of its
products.
The Company maintains a checking account with a financial institution,
which is also a wholly-owned subsidiary of its parent. The balance in this
account was approximately $443,000 at December 31, 1999 and $387,000 at December
31, 1998.
(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.
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, 1999, 1998 and 1997 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
------------------------------------------ -----------------------------------------
1999 1998 1997 1999 1998 1997
------------- ------------ ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Reported on a statutory basis ........... $ 8,813,513 $ 6,191,762 $ 5,809,629 $ 45,872,816 $ 37,991,708 $ 32,159,721
------------ ------------ ------------ ------------ ------------ ------------
Adjustments:
Deferred policy acquisition costs (b) 2,828,344 2,607,517 351,239 24,607,577 20,873,233 18,446,716
Future policy benefits (a) ........... (901,121) (1,259,673) 133,848 (5,161,385) (4,260,262) (3,000,589)
Deferred income taxes ................ (203,000) (265,000) 603,000 1,868,000 473,000 1,039,000
Premiums due and deferred (e) ........ 102,955 85,385 84,291 (1,086,477) (1,189,428) (1,274,816)
Cost of collection and other statutory
liabilities ....................... (4,228) (6,185) (924) 25,648 29,874 36,060
Non-admitted assets .................. -- -- -- 236,793 218,959 224,411
Asset valuation reserve .............. -- -- -- 2,065,557 1,691,873 1,325,986
Interest maintenance reserve ......... (192,495) (223,136) (55,019) -- 436,803 56,112
Gross unrealized holding gains on
available-for-sale securities ..... -- -- -- (1,506,000) 4,099,000 3,032,000
Net realized capital gains (losses) .. (1,190,548) 914,891 158,874 -- -- --
Other ................................ 405,349 (310,402) (53,489) -- -- --
------------ ------------ ------------ ------------ ------------ ------------
845,256 1,543,397 1,221,820 21,049,713 22,373,052 19,884,880
------------ ------------ ------------ ------------ ------------ ------------
In accordance with generally accepted
accounting principles ................ $ 9,658,769 $ 7,735,159 $ 7,031,449 $ 66,922,529 $ 60,364,760 $ 52,044,601
============ ============ ============ ============ ============ ============
Per share, based on 534,350 shares
outstanding .......................... $ 18.08 $ 14.48 $ 13.16 $ 125.24 $ 112.97 $ 97.40
============ ============ ============ ============ ============ ============
</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
1999 1998 OF ISSUE INTEREST MORTALITY TABLE WITHDRAWAL
---- ---- -------- -------- --------------- ----------
<S> <C> <C> <C> <C> <C>
Non-par:
$1,314,871 $ 1,458,458 1962-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton B
4,852,177 5,021,949 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton B
2,093,102 2,403,257 1984-1988 7 1/2% 85% of 1965-70 Basic Select Modified
plus Ultimate Linton B
130,064 116,030 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Linton B
118,686 63,482 1989-Present 7 1/2% 1975-80 Basic Select plus Ultimate Actual
25,240 26,682 1989-Present 8% 1975-80 Basic Select plus Ultimate Actual
33,668,196 33,158,902 1985-Present 6% Accumulation of Funds --
Par:
220,214 216,096 1966-1967 4 1/2% 1955-60 Basic Select plus Ultimate Linton A
12,886,598 13,141,191 1968-1988 5 1/2% 1955-60 Basic Select plus Ultimate Linton A
956,577 907,950 1981-1984 7 1/4% 90% of 1965-70 Basic Select
plus Ultimate Linton B
4,864,140 4,791,142 1983-1988 9 1/2% 80% of 1965-70 Basic Select
plus Ultimate Linton B
19,211,131 17,805,284 1990-Present 8% 66% of 1975-80 Basic Select
plus Ultimate Linton B
Annuities:
14,360,260 16,075,327 1976-Present 5 1/2% Accumulation of Funds --
Miscellaneous:
29,724,170 24,418,452 1962-Present 2 1/2%-3 1/2% 1958-CSO None
</TABLE>
- ------------------
* The above amounts are before deduction of deferred premiums of $748,330 in
1999 and $817,348 in 1998.
(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 that were used for computing liabilities for future policy benefits.
Amortization of $969,205 in 1999, $1,005,483 in 1998 and $663,200 in 1997 was
charged to operations.
(c) Participating business represented 7.9% and 8.8% of individual life
insurance in force at December 31, 1999 and 1998, 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 $36,088,375, $28,207,166 and $22,374,879 at December
31, 1999, 1998 and 1997, 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, 1999 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.
Deferred tax liabilities (assets) are comprised of the following:
<TABLE>
<CAPTION>
1999 1998
------------------ -------------------
<S> <C> <C>
Policyholder dividend provision.................................................... $ (471,717) $ (448,300)
Non-qualified agents' pension plan reserve......................................... (1,306,579) (1,262,900)
Deferred policy acquisition costs.................................................. 3,535,251 2,956,800
Future policy benefits............................................................. (3,042,310) (2,835,100)
Bond discount...................................................................... 47,677 35,900
Unrealized holding gains (losses) on Available-For-Sale Securities................. (468,000) 1,130,000
Capital loss carryover............................................................. (100,759) -
Other.............................................................................. (61,563) (49,400)
--------------- ------------------
$ (1,868,000) $ (473,000)
=============== ===============
</TABLE>
The currently payable Federal Income tax provision of $4,865,000 for 1999 is
net of a $311,000 Federal tax benefit resulting from a capital loss carryback of
$914,891.
<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, 1999, 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.
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
Level Premium Variable Life Insurance as of December 31, 1999, 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 18, 2000
<PAGE>
FIRST INVESTORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
-----------------
ASSETS
Investments at net asset value (Note 3):
First Investors Life Series Fund.............................. $280,360,092
LIABILITIES
Payable to First Investors Life Insurance Company............. 3,391,554
------------
NET ASSETS....................................................... $276,968,538
============
Net assets represented by Contracts.............................. $276,968,538
============
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
----------------------------
INVESTMENT INCOME
Income:
Dividends.................................................... $ 7,858,303
-------------
Total income............................................. 7,858,303
-------------
Expenses:
Cost of insurance charges (Note 4)........................... 4,118,808
Mortality and expense risks (Note 4)......................... 1,185,762
-------------
Total expenses........................................... 5,304,570
-------------
NET INVESTMENT INCOME............................................ 2,553,733
-------------
UNREALIZED APPRECIATION ON INVESTMENTS
Beginning of year............................................... 62,632,266
End of year..................................................... 106,362,120
------------
Change in unrealized appreciation on investments.................. 43,729,854
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. $ 46,283,587
============
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE
STATEMENT OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31,
------------------------
<TABLE>
<CAPTION>
1999 1998
------------ -------------
<S> <C> <C>
Increase (Decrease) in Net Assets
From Operations
Net investment income................................................. $ 2,553,733 $ 6,705,358
Change in unrealized appreciation on investments...................... 43,729,854 14,328,720
------------- -------------
Net increase in net assets resulting from operations.................. 46,283,587 21,034,078
-------------- -------------
From Unit Transactions
Net insurance premiums................................................ 35,997,842 32,896,170
Contract payments..................................................... (16,327,378) (15,071,523)
-------------- --------------
Net increase in net assets derived from unit transactions............. 19,670,464 17,824,647
-------------- --------------
Net increase in net assets............................................ 65,954,051 38,858,725
Net Assets
Beginning of year....................................................... 211,014,487 172,155,762
------------- -------------
End of year............................................................. $276,968,538 $211,014,487
============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST INVETORS LIFE
LEVEL PREMIUM VARIABLE LIFE INSURANCE
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
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.
FEDERAL 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
-----------
<TABLE>
<CAPTION>
Investments consist of the following:
Net Asset Market
Shares Value Value Cost
--------- ----- -------- ----------
<S> <C> <C> <C> <C>
First Investors Life
Series Fund
Cash Management.................................. 1,668,629 $ 1.00 $ 1,668,629 $ 1,668,629
High Yield....................................... 3,225,972 11.19 36,091,945 34,663,029
Growth........................................... 1,611,142 43.06 69,379,797 35,229,011
Discovery........................................ 1,527,667 33.96 51,877,540 33,202,460
Blue Chip........................................ 1,982,390 32.14 63,711,726 33,436,054
International Securities......................... 1,868,268 24.62 45,993,598 26,333,309
Focused Equity................................... 24,566 10.25 251,881 244,079
Government....................................... 112,880 9.92 1,119,790 1,158,447
Investment Grade................................. 235,586 10.97 2,584,782 2,520,805
Utility Income................................... 437,698 17.55 7,680,404 5,542,148
-------------- --------------
$280,360,092 $173,997,971
</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, 1999 was $1,185,762.
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, 1999
cost of insurance charges amounted to $4,118,808.
<PAGE>
[FIRST INVESTORS LOGO]
95 Wall Street
New York, New York 10005
(212) 858-8200
<PAGE>
PART II
CONTENTS OF REGISTRATION STATEMENT
(INFORMATION NOT REQUIRED TO BE FILED IN A PROSPECTUS)
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned Registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
UNDERTAKING PURSUANT TO RULE 484(B)(1)
UNDER THE SECURITIES ACT OF 1933
Article XIV of the By-Laws of First Investors Life Insurance Company
provides as follows:
"To the full extent authorized by law and by the Charter, the Corporation
shall and hereby does indemnify any person who shall at any time be made,
or threatened to be made, a party in any civil or criminal action or
proceeding by reason of the fact that he, his testator or his intestate is
or was a director or officer of the Corporation or served another
corporation in any capacity at the request of the Corporation, provided,
that the notice required by Section 62-a of the Insurance Law of the State
of New York, as now in effect or as amended from time to time, be filed
with the Superintendent of Insurance."
Reference is hereby made to the New York Business Corporation Law,
Sections 721 through 725.
The general effect of this Indemnification will be to indemnify any person
made, or threatened to be made, a party to an action by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that the
person, or that person's testator or intestate, is or was a director or officer
of the corporation, or is or was serving at the request of the corporation as a
director or officer of any other corporation of any type or kind, domestic or
foreign, of any partnership, joint venture, trust, employee benefit plan or
other enterprise, against amounts paid in settlement and reasonable expenses,
including attorney's fees, actually and necessarily incurred in connection with
the defense or settlement of such action, or in connection with an appeal
therein if such director or officer acted in good faith, for a purpose
reasonably believed by that person to be in, and not opposed to, the best
interests of the corporation and not otherwise knowingly unlawful.
<PAGE>
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.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
First Investors Life Level Premium Variable Life Insurance (Separate Account B)
pursuant to the foregoing provisions, or otherwise, the First Investors Life
Level Premium Variable Life Insurance (Separate Account B) has been advised that
in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the First Investors Life Level Premium Variable Life
Insurance (Separate Account B) of expenses incurred or paid by a director,
officer or controlling person of the First Investors Life Level Premium Variable
Life Insurance (Separate Account B) in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the First Life Level Premium
Variable Life Insurance (Separate Account B) will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against policy as expressed in the Act and will be governed by the final
adjudication of such issue.
Representation Regarding Reasonableness of
Aggregate Policy Fees and Charges
Pursuant to Section 26(a)(e)(2)(A) of the
Investment Company Act of 1940
First Investors Life represents that the fees and charges deducted under
the Policies described in this Registration Statement, in the aggregate, are
reasonable in relation to the services rendered, the expenses expected to be
incurred, and the risks assumed by First Investors Life under the Policies.
First Investors Life bases its representation on its assessment of all of the
facts and circumstances, including such relevant factors as: the nature and
extent of such services, expenses and risks; the need for First Investors Life
to earn a profit; and the regulatory standards for exemptive relief under the
Investment Company Act of 1940 under prior to October 1996, including the range
of industry practice. This representation applies to all Policies sold pursuant
to this Registration Statement, including those sold on terms specifically
described in the prospectus contained herein, or any variations therein, based
on supplements, endorsements, or riders to any Policies or prospectus, or
otherwise.
This Registration Statement for First Investors Life Level Premium Variable Life
Insurance comprises the following papers and documents.
<PAGE>
The facing page.
Reconciliation and Tie.
Prospectus, consisting of 30 pages. The undertaking to file reports.
Undertaking pursuant to Rule 484 (b)(1) under the Securities Act of 1933.
Representation Regarding Reasonableness of Fees and Charges.
The signatures.
Written consents of the following persons:
Tait, Weller & Baker. (Filed herewith.)
The following Exhibits:
1. (A - Form N-8B-2)
1. Resolution of Board of Directors Creating Separate
Account. /1/
2. Not Applicable.
3(a). Underwriting Agreement. /1/
3(b). Specimen Associate's Agreement. /1/
3(c). Commission schedule. /1/
4. Not Applicable.
5. Specimen Variable Life Insurance Policy. /1/
6. Certificate of Incorporation, as amended, and
By-Laws, as amended, of First Investors Life
Insurance Company. /1/
7. See (5) above.
8. Not Applicable.
9. Not Applicable.
10. Specimen form of application used with Variable
Life Insurance Policy provided in response to 5
above. /2/
<PAGE>
2. Opinion of Counsel. /2/
Opinion of Actuary. /2/
3. Not Applicable.
4. Not Applicable.
5. Financial Data Schedule. (see Exhibit 27 below.)
6. Consent of Independent Public Accountants. (Filed herewith.)
7. Powers of Attorney. /1/
27. Financial Data Schedule. (Inapplicable, because, notwithstanding
Instruction 5 as to Exhibits, the Commission staff has advised that no
such Schedule is required.)
- -------------------
/1/ Previously filed in Post-Effective Amendment No. 17 to Registrant's
Registration Statement (File No.2-98410) filed on May 19, 1997.
/2/ Previously filed in Post-Effective Amendment No. 18 to Registrant's
Registration Statement (File No.2-98410) filed on April 28, 1998.
<PAGE>
SIGNATURES
- ----------
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, First Investors Life Level Premium Variable Life Insurance (Separate
Account B), represents that this Amendment meets all the requirements for
effectiveness pursuant to Rule 485(b) under the Securities Act of 1933, and has
duly caused this Amendment to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereinafter affixed and attested,
all in the City of New York, and State of New York, on the 20th day of April,
2000.
FIRST INVESTORS LIFE LEVEL PREMIUM
VARIABLE LIFE INSURANCE
(SEPARATE ACCOUNT B)
(Registrant)
[Corporate Seal Affixed]
BY: FIRST INVESTORS LIFE
INSURANCE COMPANY
(Depositor)
(On behalf of the
ATTEST: Registrant
and itself)
/S/ ADA M SUCHOW By /S/ WILLIAM H. DRINKWATER
- ---------------- -------------------------
Ada M Suchow, William H. Drinkwater,
Assistant Secretary President
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to Registrant's Registration Statement has been signed below by the following
officers and directors of the Depositor in the capacities and on the dates
indicated:
SIGNATURE TITLE DATE
--------- ----- ----
/S/ WILLIAM H. DRINKWATER President April 20, 2000
- -------------------------
William H. Drinkwater and Director
/S/ WILLIAM M. LIPKUS Vice President and April 20, 2000
- ---------------------
William M. Lipkus Chief Financial
Officer
<PAGE>
/S/ GLENN O. HEAD
- -----------------
Glenn O. Head Chairman and Director April 20, 2000
Richard H. Gaebler* Director April 20, 2000
Jay G. Baris* Director April 20, 2000
Scott Hodes* Director April 20, 2000
Jackson Ream* Director April 20, 2000
Nelson Schaenen Jr.* Director April 20, 2000
John T. Sullivan* Director April 20, 2000
Kathryn S. Head* Director April 20, 2000
Glenn T. Dallas* Director April 20, 2000
/S/ CLARK D. WAGNER
- -------------------
Clark D. Wagner Director April 20, 2000
* By:/S/ GLENN O. HEAD
-----------------
Glenn O. Head
Attorney-In-Fact
Pursuant to Powers of
Attorney previously filed
EXHIBIT 6
---------
TAIT, WELLER & BAKER
CERTIFIED PUBLIC ACCOUNTANTS
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
First Investors Life Insurance Company
95 Wall Street
New York, NY 10005
We hereby consent to the use in Post-Effective Amendment No. 22 to the
Registration Statement on Form S-6 (File No. 2-98410) of our report dated
February 18, 2000 relating to the December 31, 1999 financial statements of
First Investors Life Level Premium Variable Life Insurance (Separate Account B)
and our report dated February 18, 2000 relating to the December 31, 1999
financial statements of First Investors Life Insurance Company, which are
included in said Registration Statement.
/s/ TAIT, WELLER & BAKER
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
April 19, 2000
