THE EQUITABLE LIFE ASSURANCE SOCIETY
OF THE UNITED STATES
INCENTIVE LIFE COLI
Flexible premium variable life
insurance policies
PROSPECTUS SUPPLEMENT DATED DECEMBER 10, 1999
TO THE INCENTIVE LIFE PLUS PROSPECTUS DATED
OCTOBER 18, 1999
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This supplement modifies certain information contained in the prospectus dated
October 18, 1999 for Incentive Life Plus flexible premium variable life
insurance policies issued by Equitable Life. Subject to the rules discussed
below, Equitable Life will offer a modified version of its Incentive Life Plus
policy (the "Incentive Life COLI Policy") to qualified offerees. This supplement
describes the material differences between the Incentive Life COLI Policy and
the Incentive Life Plus policy described in the prospectus. You should keep this
supplement with your prospectus. We will send you another copy of the Incentive
Life Plus prospectus, without charge, on written request.
Under our current rules, the Incentive Life COLI Policy will be offered to
corporations and partnerships that meet the following conditions at issue:
o a minimum of five policies are issued, each for a different eligible insured
person;
o the persons proposed to be insured under the policies are deemed by us to be
"highly compensated" individuals;
o the minimum initial premium under each of the policies must be remitted to us
by the employer;
o the aggregate annualized first year planned periodic premium for all policies
must be at least $150,000; and
o certain undertakings, which we may require in certain situations, have been
submitted to us.
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Set forth below are modifications to the discussion in the prospectus which are
appropriate with respect to the Incentive Life COLI Policy.
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MINIMUM FACE AMOUNT. The minimum face amount for the Incentive Life COLI
Policy is $100,000.
FACE AMOUNT INCREASES. You may not request a face amount increase after you
receive your Incentive Life COLI Policy.
OPTIONAL RIDER BENEFITS. The optional benefits described in the Incentive Life
Plus prospectus under the heading "Other benefits you can add by rider" are not
available under the Incentive Life COLI Policy.
DEDUCTIONS FROM PREMIUMS. Rather than deducting the sales charge from premiums,
we will deduct a sales charge from the policy's value as part of the regular
monthly deduction for each month during the policy's first ten policy years. The
amount deducted each month will depend on the specifics of your policy
[superscript: 1]. The cumulative amount we deduct under this charge, however,
will never exceed 6% of the premiums you have paid to date.
METHOD OF DEDUCTING MORTALITY AND EXPENSE RISK CHARGE. Rather than deducting
this charge daily from investment performance (as we do for the Incentive Life
Plus policies), we will deduct it from your policy's account value each month as
part of our regular monthly deduction. The charge will be at an effective annual
rate of .60% of the amount you have in the policy's investment options (not
including any amounts we are holding as collateral for policy loans). We have
the right, however, to increase this charge, but not to more than .90%.
CURRENT COST OF INSURANCE CHARGE RATES. Current cost of insurance rates during
the first two years are generally lower than the current cost of insurance rates
for the Incentive Life Plus policy. This relationship between the cost of
insurance rates of the two policies is not guaranteed, however.
The reduction in the current charges that begins in the tenth policy year will
grade up to an annual rate of .60% in the twenty-fifth policy year and later.
This charge reduction (which, except for a difference in rate, is described in
the prospectus under "Deducting policy charges--monthly cost of insurance
charge") applies on a current basis and is not guaranteed.
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([superscript: 1]) For no policy, however, will it be higher than $0.78 per
$1,000 of the policy's initial face amount or lower than $0.02 per $1,000.
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SURRENDER CHARGES. There is no administrative surrender charge under the
Incentive Life COLI Policies. Subject to certain limits described below that
apply during the first five years, the premium surrender charge for the
Incentive Life COLI Policies will be the smaller of (a) 66% of one "target
premium"[superscript: 2] (or less for surrenders after the ninth
year)[superscript: 3] or (b) the sum of 24% of the amount of premiums you paid
in your policy's first year up to one target premium and 3% of all additional
premiums you pay in the first 15 years.
There is an additional limit that can reduce or eliminate the premium surrender
charge if the Incentive Life COLI Policy is surrendered during its first five
years. The percentage reduction is as follows:
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SURRENDER PERCENT OF SURRENDER
IN POLICY YEAR CHARGES WAIVED
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1 100%
2 80%
3 60%
4 40%
5 20%
6 and later 0%
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([superscript: 2]) The "target premium" is actuarially determined for each
policy, based on that policy's particular characteristics. The "target premium"
used in computing surrender charges may differ from target premiums used for
other purposes under the policies.
([superscript: 3]) Beginning in your policy's tenth year, this amount declines
at a constant rate each month until no surrender charge applies to surrenders
made after the policy's 15th year. The initial amount of the surrender charge in
clause (a) will be set forth in your policy. The lowest initial amount for
clause (a) for any policy would be $2.38 for each $1,000 of initial face amount
and the highest initial amount for clause (a) would be $27.59 per $1,000.
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The following replaces the information in your prospectus under "More
information about other matters--How we market the policies":
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HOW WE MARKET THE POLICIES
We offer variable life insurance policies (including Incentive Life) and
variable annuity contracts through Equitable Distributors, Inc. ("EDI"). The
Investment Company Act of 1940, therefore, classifies EDI as a "principal
underwriter" of those policies and contracts. EDI also serves as a principal
underwriter of EQ Advisors Trust. EDI is a wholly owned subsidiary of Equitable
Life, with its address at 1290 Avenue of the Americas, New York, NY 10104. EDI
is registered with the SEC as a broker-dealer and is a member of the National
Association of Securities Dealers, Inc. ("NASD"). In 1997 and 1998, we paid EDI
a fee of $20,088,049 and $35,582,313, respectively, for its services under a
Distribution Agreement with Equitable Life and its separate accounts.
We sell these variable life products through licensed insurance agencies (both
affiliated and unaffiliated with Equitable Life) and their affiliated
broker-dealers (who are registered with the SEC and are members of the NASD).
Such agencies and their affiliated broker-dealers have entered into selling
agreements with EDI. The licensed insurance agents who sell our policies are
appointed as agents of Equitable Life, and are registered representatives of the
agencies' affiliated broker-dealer. Sales commissions will be paid by Equitable
Life to the agency that sells you this policy. The commissions don't cost you
anything above the charges and expenses already discussed elsewhere in this
prospectus. Generally, the agencies will receive maximum commissions of: 50% of
the amount of the premium you pay in your policy's first year up to a certain
amount, plus 3% of all other premiums you pay in your policy's first year, plus
3% of all premiums you pay in the second through tenth years. We pay comparable
commissions on the amount of premiums you pay that we deem attributable to any
face
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amount increase that you request. The agency may be required to return to us any
commissions on premiums that we have refunded to a policyowner.
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The following replaces the information about our address and phone numbers in
your prospectus under "How to reach us":
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HOW TO REACH US
To obtain (1) any forms you need for communicating with us, (2) unit values and
other values under your policy, and (3) any other information or materials that
we provide in connection with your policy or the Portfolios, you can contact us
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BY MAIL:
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at the Post Office Box for our Administrative Office:
Equitable Life Client Services
Radio City Station
P.O. Box 808
New York, New York 10101-0808
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BY EXPRESS DELIVERY:
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at the Street Address for our Administrative Office:
Equitable Life Client Services
135 W. 50th St., 10th Floor
New York, New York 10020
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BY TOLL-FREE PHONE:
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1-888-228-6690
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BY E-MAIL:
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[email protected]
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BY FAX:
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1-212-641-7075
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BY INTERNET:
Our Web site (www.equitable.com) can also provide you information.
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The rest of the information under "How to reach us" remains unchanged, except
that, in addition to the forms listed there, we have a special form that you
must use if you want to request our asset rebalancing service.
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The following replaces the phone numbers in your prospectus under "Transferring
your money among our investment options--Telephone transfers" and "More
information about other matters--Telephone requests":
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TELEPHONE TRANSFERS
The phone number that is available if you are both the policy's insured person
and its owner is 1-888-228-6690 (toll free) from a touch-tone phone.
All the other information in these sections of the prospectus remains unchanged.
