WRL SERIES FUND INC, 497, 1999-09-16

WRL SERIES FUND INC
497, 1999-09-16

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WRL SERIES FUND, INC.

AGGRESSIVE EQUITY PORTFOLIOS
o WRL VKAM EMERGING GROWTH
o WRL T. ROWE PRICE SMALL CAP
o WRL GOLDMAN SACHS SMALL CAP
o WRL PILGRIM BAXTER MID CAP GROWTH
o WRL ALGER AGGRESSIVE GROWTH
o WRL THIRD AVENUE VALUE

FOREIGN EQUITY PORTFOLIOS
o WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
o WRL JANUS GLOBAL

GROWTH EQUITY PORTFOLIOS
o WRL SALOMON ALL CAP
o WRL JANUS GROWTH
o WRL GOLDMAN SACHS GROWTH
o WRL C.A.S.E. GROWTH
o WRL GE U.S. EQUITY
o WRL DREYFUS MID CAP
o WRL NWQ VALUE EQUITY
o WRL T. ROWE PRICE DIVIDEND GROWTH

BALANCED PORTFOLIOS
o WRL DEAN ASSET ALLOCATION
o WRL LKCM STRATEGIC TOTAL RETURN
o WRL J.P. MORGAN REAL ESTATE SECURITIES
o WRL FEDERATED GROWTH & INCOME
o WRL AEGON BALANCED

FIXED-INCOME PORTFOLIOS
o WRL AEGON BOND

CAPITAL PRESERVATION PORTFOLIOS
o WRL J.P. MORGAN MONEY MARKET

Prospectus

The Securities and Exchange Commission
has not approved or disapproved these
securities or passed upon
the adequacy of this prospectus.
Any representation to the contrary is a criminal offense.

May 1, 1999

As Supplemented September 10, 1999

<PAGE>

TABLE OF CONTENTS

INVESTOR INFORMATION ...................................... 1

ALL ABOUT THE FUND

AGGRESSIVE EQUITY PORTFOLIOS
WRL VKAM Emerging Growth ............................... 2
WRL T. Rowe Price Small Cap ............................ 3
WRL Goldman Sachs Small Cap ............................ 4
WRL Pilgrim Baxter Mid Cap Growth ...................... 4
WRL Alger Aggressive Growth ............................ 5
WRL Third Avenue Value ................................ 5

FOREIGN EQUITY PORTFOLIOS
WRL GE/Scottish Equitable International Equity ......... 11
WRL Janus Global ....................................... 12

GROWTH EQUITY PORTFOLIOS
WRL Salomon All Cap .................................... 15
WRL Janus Growth ....................................... 16
WRL Goldman Sachs Growth ............................... 16
WRL C.A.S.E. Growth .................................... 17
WRL GE U.S. Equity ..................................... 18
WRL Dreyfus Mid Cap .................................... 18
WRL NWQ Value Equity ................................... 18
WRL T. Rowe Price Dividend Growth ...................... 19

BALANCED PORTFOLIOS
WRL Dean Asset Allocation .............................. 25
WRL LKCM Strategic Total Return ........................ 26
WRL J.P. Morgan Real Estate Securities ................ 26
WRL Federated Growth & Income .......................... 27
WRL AEGON Balanced ..................................... 28

FIXED-INCOME PORTFOLIOS
WRL AEGON Bond ......................................... 32

CAPITAL PRESERVATION PORTFOLIOS
WRL J.P. Morgan Money Market .......................... 35

RISK/REWARD INFORMATION ................................... 38

EXPLANATION OF STRATEGIES AND RISKS ....................... 39

HOW THE FUND IS MANAGED AND ORGANIZED ..................... 43

PERFORMANCE INFORMATION ................................... 47

OTHER INFORMATION ......................................... 50

FINANCIAL HIGHLIGHTS ...................................... 53

WRL Series Fund, Inc. (Fund) consists of twenty-four separate series or
investment portfolios. The Fund is an open-end management investment company,
more commonly known as a mutual fund.

This prospectus describes twenty-three of the Fund's portfolios. Shares of these
portfolios are currently only sold to separate accounts of Western Reserve Life
Assurance Co. of Ohio, PFL Life Insurance Company, AUSA Life Insurance Company
and Peoples Benefit Life Insurance Company to fund the benefits under certain
individual flexible premium variable life insurance policies and individual and
group variable annuity contracts.

A particular portfolio of the Fund may not be available under the policy or
annuity contract you have chosen. The prospectus or disclosure document for your
policy or annuity contract shows the portfolios available to you.

Please read this prospectus carefully before selecting a portfolio. It provides
information to assist you in your decision. If you would like additional
information about a portfolio, please request a copy of the Statement of
Additional Information (SAI) (see back cover). The SAI is incorporated by
reference into this prospectus.

Prospectus
<PAGE>

INVESTOR INFORMATION

TO HELP YOU UNDERSTAND . . .

In this prospectus, you will see the symbols below.

These are "icons" which serve as tools to direct you to the type of information
that is included in the accompanying paragraphs.

The icons are for your convenience and to assist you as you read this
prospectus.

[GRAPHIC OMITTED] The target directs you to a portfolio's goal or
objective.

[GRAPHIC OMITTED] The chess piece indicates discussion about a
portfolio's strategies.

[GRAPHIC OMITTED] The warning sign indicates the risks of investing
in a portfolio.

[GRAPHIC OMITTED] The graph indicates investment performance.

[GRAPHIC OMITTED] The question mark provides additional information about the
Fund or may direct you on how to obtain further information.

SHARES OF A PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY, ANY
BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY OF THE U.S.
GOVERNMENT.

Prospectus 1
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS

WRL VKAM EMERGING GROWTH (FORMERLY EMERGING GROWTH PORTFOLIO)

WRL T. ROWE PRICE SMALL CAP

WRL GOLDMAN SACHS SMALL CAP

WRL PILGRIM BAXTER MID CAP GROWTH

WRL ALGER AGGRESSIVE GROWTH (FORMERLY AGGRESSIVE GROWTH PORTFOLIO)

WRL THIRD AVENUE VALUE (FORMERLY THIRD AVENUE VALUE PORTFOLIO)

THIS RISK/RETURN SUMMARY BRIEFLY DESCRIBES EACH AGGRESSIVE EQUITY PORTFOLIO OF
THE FUND AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS. FOR FURTHER
INFORMATION ON THESE PORTFOLIOS, PLEASE READ THE SECTION ENTITLED "EXPLANATION
OF STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL VKAM EMERGING GROWTH
This portfolio seeks capital appreciation by investing primarily in common
stocks of small and medium-sized companies.

WRL T. ROWE PRICE SMALL CAP
This portfolio seeks long-term growth of capital by investing primarily in
common stocks of small growth companies.

WRL GOLDMAN SACHS SMALL CAP
This portfolio seeks long-term growth of capital.

WRL PILGRIM BAXTER MID CAP GROWTH
This portfolio seeks capital appreciation.

WRL ALGER AGGRESSIVE GROWTH
This portfolio seeks long-term capital appreciation.

WRL THIRD AVENUE VALUE
This portfolio seeks long-term capital appreciation.

WHAT IS AN AGGRESSIVE EQUITY PORTFOLIO?
Aggressive Equity Portfolios are those that seek maximum capital
appreciation (a rise in the share price/value). Current income is not a
significant factor. Some portfolios that are included in this category may
invest in out-of-the main-stream stocks, such as those of fledging or
struggling companies, or those in new or currently out-of-favor industries.
Some portfolios in this category may also use specialized investment
techniques such as options or short-term investing. For these reasons,
these portfolios usually entail greater risk than the overall equity
portfolio category.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL VKAM EMERGING GROWTH
The portfolio's sub-adviser, Van Kampen Asset Management Inc. (VKAM), seeks to
achieve the portfolio's objective by investing principally in:

o Domestic and foreign common stocks of small and medium-sized companies
o Options
o Futures

Prospectus 2
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

VKAM invests at least 65% of the portfolio's assets (under normal market
conditions) in common stocks of companies that are in the early stages of their
life cycle, and are believed by VKAM to have the potential to become major
enterprises. Some securities may have above average price volatility. VKAM
attempts to reduce overall exposure to risk from declines in the security
prices by spreading the portfolio's investments over many different companies
in a variety of industries.

VKAM will utilize options on securities, futures contracts and options thereon
in several different ways, depending upon the status of the portfolio's
investment portfolio and its expectations concerning the securities market.

In times of stable or rising stock prices, the portfolio generally seeks to be
fully invested. Even when the portfolio is fully invested, VKAM believes that
at least a small portfolio of assets will be held as cash or cash equivalents
to honor redemption requests and for other short-term needs.

The amount of portfolio assets invested in cash equivalents does not fluctuate
with stock market prices, so that, in times of rising market prices, the
portfolio may underperform the market in proportion to the amount of cash
equivalents in its portfolio. By purchasing stock index futures contracts,
stock index call options, or call options on stock index futures contracts,
however, the portfolio can seek to "equalize" the cash portion of its assets
and obtain performance that is equivalent to investing 100% in equity
securities.

The portfolio may take a temporary defensive position when the securities
trading markets or the economy are experiencing volatility or a prolonged
general decline, or other adverse conditions exist. This may be inconsistent
with the portfolio's principal investment strategies. Under these conditions,
the portfolio will be unable to achieve its investment objective.

WHAT IS A TOP-DOWN APPROACH?
When using a "top-down" approach, the portfolio manager looks first at
broad market factors, and on the basis of those market factors, chooses
certain sectors, or industries within the overall market. The manager then
looks at individual companies within those sectors or industries.

WRL T. ROWE PRICE SMALL CAP
The portfolio's sub-adviser, T. Rowe Price Associates, Inc. (T. Rowe Price),
seeks to achieve the portfolio's objective by investing principally in:

o Common stocks of small-cap growth companies

To a lesser extent, the portfolio may invest in:

o Stock index futures

This portfolio will invest at least 65% of the fund's total assets in small-cap
growth companies. These companies are defined as companies whose market
capitalization is smaller than 80% of those in the Standard & Poor's 500 Stock
Index (S&P 500), which was approximately $2.8 billion as of December 31, 1998,
but the upper size limit will vary with market fluctuations. The S&P 500
measures the performance of the common stocks of 500 large U.S. companies in the
manufacturing, utilities, transportation, and financial industries. It also
tracks the performance of common stocks issued by foreign and smaller U.S.
companies in similar industries. (A company's market "cap" is found by
multiplying its shares outstanding by its stock price.) Companies whose
capitalization increases above this range after the portfolio's initial purchase
continue to be considered small companies for purposes of this policy.

To help manage cash flows efficiently, T. Rowe Price may also buy and sell
stock index futures. The portfolio will be more diversified than many small-cap
growth funds; once the portfolio achieves sufficient size, the top 25 holdings
will not compose a large portion of assets. This should minimize the effects of
individual security selection on portfolio performance.

Quantitative models are furnished by a sub-adviser to assist the sub-adviser in
evaluating a potential security. Characteristics are included in the model that
the sub-adviser deems advantageous in a security. Based on these models, stocks
are selected in a "top-down" manner so that the portfolio's portfolio as a
whole reflects characteristics T. Rowe Price considers important, such as
valuations (price/earnings or price/
book value ratios, for example) and projected earnings growth.

While the portfolio invests primarily in common stocks, it may also purchase
other securities, including futures and options, in keeping with its objective.

Prospectus 3
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

The portfolio may sell securities for a variety of reasons, such as to secure
gains, limit losses, or redeploy assets into more promising opportunities.

The portfolio may take a temporary defensive position when the securities
trading markets or the economy are experiencing excessive volatility or a
prolonged general decline, or other adverse conditions exist. This may be
inconsistent with the portfolio's principal investment strategies. Under these
circumstances, the portfolio may be unable to achieve its investment objective.

WHAT IS A QUANTITATIVE MODEL?
A quantitative model is fashioned by a portfolio's sub-adviser to assist
the sub-adviser in evaluating a potential security. The sub-adviser creates
a model that is designed using characteristics that the sub-adviser deems
advantageous in a security. The sub-adviser then compares a potential
security's characteristics against those of the model, and makes a
determination of whether or not to purchase the security based on the
results of that comparison.

WRL GOLDMAN SACHS SMALL CAP
The portfolio's sub-adviser, Goldman Sachs Asset Management (GSAM), seeks to
achieve the portfolio's objective by investing principally in:

o Equity securities of U.S. issuers, and certain foreign issuers
that are traded in the U.S.

The portfolio will invest at least 90% of its assets in equity securities of
companies with public stock market capitalizations within the range of the
market capitalization of companies constituting the Russell 2000 (a widely
recognized unmanaged index of market performance which measures the performance
of the 2000 smallest companies in the Russell 3000 Index) at the time of
investment (currently $3.1 million to $12.3 billion). The equity securities
include those of U.S. issuers, and certain foreign issuers traded in the U.S.
The portfolio's fixed-income securities are limited to securities that are
considered cash equivalents.

The portfolio may also purchase Standard & Poor's Depositary Receipts
("SPDRs"). SPDRs are American Stock Exchange-traded securities that represent
ownership in the SPDR Trust, a trust which has been established to accumulate
and hold a portfolio of common stocks that is intended to track the price
performance and dividend yield of the S&P 500. SPDRs are included in the
portfolio's 10% limitation on investments in investment companies.

GSAM uses the CORE investment process. CORE is an acronym for
"Computer-Optimized, Research-Enhanced." GSAM selects the portfolio's
investments using both a variety of quantitative techniques and fundamental
research while seeking to maximize the portfolio's expected return, while
maintaining risk, style, capitalization and industry characteristics similar to
the Russell 2000 Index.

GSAM may take a temporary defensive position when the securities trading
markets or the economy are experiencing excessive volatility or a prolonged
general decline, or other adverse conditions exist. This may be inconsistent
with the portfolio's principal investment strategies. Under these
circumstances, the portfolio may be unable to pursue its investment objective.

WRL PILGRIM BAXTER MID CAP GROWTH
The portfolio's sub-adviser, Pilgrim Baxter & Associates, Ltd. (Pilgrim
Baxter), seeks to achieve the portfolio's objective by investing principally
in:

o Common stocks

o Convertible securities

In seeking capital appreciation, Pilgrim Baxter normally invests at least 65%
of the portfolio's total assets in growth securities, such as common stocks,
issued by companies with market capitalizations or annual revenues between $500
million and $10 billion. The portfolio invests primarily in companies that
Pilgrim Baxter believes have strong earnings growth and capital-appreciation
potential. The portfolio may also invest in foreign securities, warrants and
rights.

Prospectus 4
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

Pilgrim Baxter may take a temporary defensive position when the securities
trading markets or the economy are experiencing excessive volatility or a
prolonged general decline, or other adverse conditions exist. Under these
circumstances, the portfolio may be unable to achieve its investment objective.

WRL ALGER AGGRESSIVE GROWTH
The portfolio's sub-adviser, Fred Alger Management, Inc. (Alger), seeks to
achieve the portfolio's objective by investing principally in:

o Equity securities such as common or preferred stocks

o Convertible securities (convertible securities are securities which can be
exchanged or converted into common stock of such companies)

To a lesser extent, the sub-adviser may invest portfolio assets in:

o U.S. dollar denominated securities of foreign issuers (American Depositary
Receipts (ADRs))

o Money market instruments

o Repurchase agreements

Under normal market conditions, the portfolio invests at least 85% of its
assets in common stocks, which may include stocks of developing companies, of
older companies that are entering a new stage of growth, and of companies whose
products or services have a high unit volume growth rate.

The portfolio may also use leveraging, a technique that involves borrowing
money to invest in an effort to enhance shareholder returns.

The portfolio's manager may take a temporary defensive position when the
securities trading markets or the economy are experiencing excessive volatility
or a prolonged general decline, or other adverse conditions exist. This may be
inconsistent with the portfolio's principal investment strategies. During this
time, the portfolio may invest up to 100% of its assets in money market
instruments and cash equivalents. Under these circumstances, the portfolio will
be unable to pursue its investment objective.

WRL THIRD AVENUE VALUE
The portfolio's sub-adviser, EQSF Advisers, Inc. (EQSF), seeks to achieve the
portfolio's investment objective by investing principally in:

o Common stocks

o Debt securities

o High-yield/high-risk fixed-income securities

o Foreign securities

The portfolio invests to a lesser extent, in trade claims and engages in
foreign currency transactions for hedging purposes. (Trade claims are interests
in amounts owed to suppliers or services and are purchased from creditors of
companies in financial difficulty.)

EQSF seeks to achieve the portfolio's objective by seeking to acquire common
stocks of well-financed companies at a substantial discount for what EQSF
believes is their value as a private business or as a take over candidate. It
also seeks to acquire senior securities, such as preferred stock and debt
instruments, that have strong covenant protections and above-average yields.

EQSF seeks portfolio securities whose prices are low enough at the time of
acquisition so both the risk is lowered and appreciation potential is enhanced.
EQSF believes that value is created more by past corporate prosperity than by
bear markets.

To choose such securities, EQSF uses a "bottom-up" approach. EQSF believes the
knowledge it obtains through extensive research of individual companies reduces
risk more than does diversification so the portfolio is non-diversified.

The portolio's classification as "non-diversified" under the Investment Company
Act of 1940 (1940 Act) means that the portfolio has the ability to take larger
positions in a smaller number of issuers.

However, to meet federal tax requirements, at the close of each quarter the
portfolio may not have more than 25% of its total assets invested in any one
issuer and, with respect to 50% of its total assets, not more than 5% of its
total assets invested in any one issuer.

Prospectus 5
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

The portfolio may take a temporary defensive position when the securities
trading markets or the economy are experiencing excessive volatility or a
prolonged general decline, or other adverse conditions exist. This may be
inconsistent with the portfolio's principal investment strategies. Under these
conditions, the portfolio may be unable to achieve its investment objective.

[GRAPHIC OMITTED] RISKS OF INVESTING IN
AGGRESSIVE EQUITY PORTFOLIOS
The principal risks of investing in Aggressive Equity Portfolios that may
adversely affect your investment are described below. (Not all of these risks
apply to each Aggressive Equity Portfolio. See the chart below for the
principal risks of your portfolio.) Please note that there are many other
circumstances which could adversely affect your investment and prevent a
portfolio from achieving its objective, which are not described here. Please
refer to the section entitled "Explanation of Strategies and Risks" beginning
on page 39 and the Fund's SAI for more information about the risks of investing
in the Aggressive Equity Portfolios.

PRINCIPAL RISKS
AGGRESSIVE EQUITY PORTFOLIOS

<TABLE>
<CAPTION>
PORTFOLIO
---------
WRL WRL WRL WRL WRL WRL
VKAM EMERGING T. ROWE PRICE GOLDMAN PILGRIM BAXTER ALGER AGGRESSIVE THIRD AVENUE
RISKS GROWTH SMALL CAP SACHS SMALL CAP MID CAP GROWTH GROWTH VALUE
- -----
<S> <C> <C> <C> <C> <C> <C>
STOCKS X X X X X X
INVESTING AGGRESSIVELY X X X X X X
SMALL-CAP AND GROWTH
COMPANIES X X
QUANTITATIVE MODELS X X
NON-DIVERSIFICATION X
FUTURES & OPTIONS X X
FOREIGN SECURITIES X X X
DEPOSITARY RECEIPTS X X
CONVERTIBLES X X
LEVERAGING X
VALUE INVESTING X X
</TABLE>

o STOCKS

While stocks have historically outperformed other investments over the long
term, they tend to go up and down more dramatically over the short term. These
price movements may result from factors affecting individual companies, certain
industries or the securities market as a whole.

Because the stocks a portfolio holds fluctuate in price, the value of your
investment in the portfolio will go up and down.

o INVESTING AGGRESSIVELY

o The value of developing-company stocks may be very volatile, and can drop
significantly in a short period of time

o Rights, options and futures contracts may not be exercised and may expire
worthless

o Warrants and rights may be less liquid than stocks

o Use of futures and other derivatives may make the portfolio more volatile

o SMALL-CAP AND GROWTH COMPANIES

Investing in small companies involves greater risk than is customarily
associated with more established companies. Stocks of small companies may be
subject to more abrupt or erratic price movements than larger company
securities. Small companies often have limited product lines, markets, or
financial resources, and their management may lack depth and experience.

Prospectus 6
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

Also, growth stocks can experience steep price declines if the company's
earnings disappoint investors. Since many of the Aggressive Equity Portfolios
will typically be fully invested in this market sector, investors are fully
exposed to its volatility.

o QUANTITATIVE MODELS
Stocks selected using quantitative models may not perform as well as these
models might otherwise suggest effective and may cause overall returns to be
lower than if other methods are used.

o NON-DIVERSIFICATION
To the extent a portfolio invests a greater proportion of its assets in the
securities of a smaller number of issuers, it may be more susceptible to any
single economic, political or regulatory occurrence than a more widely
diversified portfolio and may be subject to greater risk of loss with respect
to its portfolio securities.

o FUTURES AND OPTIONS
Futures and options involve additional investment risks and transactional
costs, and draw upon skills and experience which are different than those
needed to pick other securities. Special risks include:

o Inaccurate market predictions
o Imperfect correlation
o Illiquidity
o Tax considerations

The portfolios are not required to hedge their investments.

o FOREIGN SECURITIES
Investments in foreign securities involve risks relating to political, social
and economic developments abroad as well as risks resulting from differences in
regulations to which U.S. and foreign issuers and markets are subject. To the
extent a portfolio invests in emerging markets, these risks would be greater.
These risks include:

o Changes in currency values
o Currency speculation
o Currency trading costs
o Different accounting and reporting practices
o Less information available to the public
o Less (or different) regulation of securities markets
o More complex business negotiations
o Less liquidity
o More fluctuations in market prices
o Delays in settling foreign securities transactions
o Higher transaction costs
o Higher costs for holding foreign securities (custodial fees)
o Vulnerability to seizure and taxes
o Political instability and small markets
o Different market trading days

o ADRS
Many securities of foreign issuers are represented by American Depositary
Receipts (ADRs). While ADRs principally are traded on domestic securities
exchanges, investing in ADRs involves many of the same risks associated with
foreign securities in general. These risks include:

o Changes in currency value
o Currency speculation
o Currency trading costs
o More fluctuations in market prices
o Less information available

o CONVERTIBLES
As with all debt securities, the market value of convertibles tends to decline
as interest rates increase and, conversely, to increase as interest rates
decline.

o VALUE INVESTING RISK
Undervalued stocks may not realize their perceived value for extended periods
of time. Value stocks may respond differently to market and other developments
than other types of stocks. Value oriented funds will typically underperform
when growth investing is in favor.

o LEVERAGING
Leveraging by a portfolio involves special risks:

o Leveraging practices may make a portfolio more volatile

o Leveraging may exaggerate the effect on net asset value of any
increase or decrease in the market value of the portfolio's securities

Prospectus 7
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

o Money borrowed for leveraging is subject to interest costs

o Minimum average balances may need to be maintained or a line of
credit in connection with borrowing may be necessary resulting in an
increase in the cost of borrowing over the stated interest rate.

YOU MAY LOSE MONEY IF YOU INVEST IN ANY OF THE AGGRESSIVE EQUITY PORTFOLIOS.

[GRAPHIC OMITTED] INVESTOR PROFILES

WRL VKAM EMERGING GROWTH
For the investor who seeks greater opportunities for growth of capital but who
is willing to accept special risks.

WRL T. ROWE PRICE SMALL CAP
For the investor who wants an aggressive, long-term approach to building
capital and who is comfortable with significant fluctuations inherent to
small-cap stock investing.

WRL GOLDMAN SACHS SMALL CAP
For the investor who seeks long-term growth of capital, who can tolerate the
fluctuations inherent in small-cap investing and is willing to accept the
special risks involved in quantitative stock selection techniques.

WRL PILGRIM BAXTER MID CAP GROWTH
For the investor who wants long-term growth of capital and who can tolerate the
fluctuations inherent in stock investing.

WRL ALGER AGGRESSIVE GROWTH
For the investor who seeks capital growth aggressively, and can tolerate wide
swings in the value of their investment.

WRL THIRD AVENUE VALUE
For the investor who is willing to hold shares through periods of market
fluctuations and the accompanying changes in share prices.

Prospectus 8
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

The bar charts and tables below give an indication of the portfolios' risks and
performance. The charts show changes in a portfolio's performance from year to
year. The performance calculations do not reflect charges or deductions under
the policies or the annuity contracts. These fees and expenses would lower
investment performance. The tables show how a portfolio's average annual
returns for the periods indicated compare to those of a broad measure of market
performance.

Because the WRL T. Rowe Price Small Cap, WRL Goldman Sachs Small Cap and WRL
Pilgrim Baxter Mid Cap Growth portfolios commenced operations in 1999, their
performance history is not included.

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL VKAM EMERGING GROWTH
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1994 1995 1996 1997 1998
- ---- ---- ---- ---- ----
(7.36)% 46.79% 18.88% 21.45% 37.33%

HIGHEST AND LOWEST RETURN
(Quarterly 1993-1998)
- -------------------------------------------
QUARTER ENDED
Highest 28.19 % 12/31/98
Lowest (12.53)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- --------------------------------------------------------------
SINCE
INCEPTION
1 YEAR 5 YEARS (MARCH 1, 1993)
WRL VKAM
Emerging Growth 37.33% 21.95% 23.09%
S&P 500 Index 28.58% 24.06% 21.81%

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

WRL ALGER AGGRESSIVE GROWTH
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1995 1996 1997 1998
- ---- ---- ---- ----
38.02% 10.45% 24.25% 48.69%

HIGHEST AND LOWEST RETURN
(Quarterly 1994-1998)
- ------------------------------------------
QUARTER ENDED
Highest 29.30 % 12/31/98
Lowest (9.72)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ----------------------------------------------------
SINCE
INCEPTION
1 YEAR (MARCH 1, 1994)
WRL Alger
Aggressive Growth 48.69% 23.54%
S&P 500 Index 28.58% 24.80%

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

Prospectus 9
<PAGE>

AGGRESSIVE EQUITY PORTFOLIOS (CONTINUED)

WRL THIRD AVENUE VALUE
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1998
- ----
- -6.84%

HIGHEST AND LOWEST RETURN
(Quarterly 1998)
- -------------------------------------------
QUARTER ENDED
Highest 17.85 % 12/31/98
Lowest (17.57)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ---------------------------------------------
Since
Inception
(January 2, 1998)
WRL Third Avenue Value (6.84)%
S&P 500 Index 28.58 %

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

Prospectus 10
<PAGE>

FOREIGN EQUITY PORTFOLIOS

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY (FORMERLY INTERNATIONAL EQUITY
PORTFOLIO)

WRL JANUS GLOBAL (FORMERLY GLOBAL PORTFOLIO)

THIS RISK/RETURN SUMMARY BRIEFLY DESCRIBES EACH FOREIGN EQUITY PORTFOLIO OF THE
FUND AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS. FOR FURTHER
INFORMATION ON THESE PORTFOLIOS, PLEASE READ THE SECTION ENTITLED "EXPLANATION
OF STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
This Portfolio seeks long-term growth of capital.

WRL JANUS GLOBAL
This Portfolio seeks long-term growth of capital in a manner consistent with
the preservation of capital.

WHAT IS A FOREIGN EQUITY PORTFOLIO?
This type of portfolio principally invests in equity securities of
companies located outside the U.S.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
The portfolio's sub-advisers, GE Investment Management Incorporated (GEIM) and
Scottish Equitable Investment Management Limited (SEIM), seek to achieve the
portfolio's investment objective by investing principally in:

o Common stocks and other equity securities of companies located in
developed and developing countries other than the U.S. Equity securities
are defined to include common stocks, preferred stocks, convertible
preferred stocks and convertible bonds, debentures and notes, depositary
receipts, and rights and warrants.

Each day, the cash that flows into the portfolio for investment is divided
equally by SEIM and GEIM, and they manage each portion separately from then on.

Normally, 65% of the portfolio's assets are invested in at least 50 equity
securities of companies located in 15 to 25 different countries. Under certain
circumstances, the portfolio may invest in securities of companies located in
the U.S. The portfolio is never invested in companies of fewer than 12
countries other than the U.S. The portfolio may invest to a lesser extent in
debt securities.

The portfolio managers consider the following factors in determining where an
issuer is located: country of organization, primary securities trading market,
location of assets or where the issuer derives at least half of its revenues
and profits.

The portfolio invests, not only in the larger markets of Europe and Japan, but
also, to a lesser extent, in the smaller markets of Asia, Emerging Europe,
Latin America, and other emerging markets.

Overseas economies usually don't move in the same direction and operate
differently. This creates situations the portfolio aims to take advantage of
through asset allocation among international markets.

The portfolio may use various investment techniques to adjust the portfolio's
investment exposure, but there is no guarantee that these techniques will work.

SEIM looks for countries where economic growth conditions are favorable and
where stock market valuations don't reflect that potential. It then looks for
companies in those countries whose earnings potential is not reflected in the
share price.

GEIM looks for companies expected to grow faster than relevant markets, and
whose security price doesn't fully reflect that. Attributes of such companies
are low prices relative to their long-term cash earnings potential, potential
for significant improvement in the company's business, financial strength and
sufficient liquidity. Stock selection is key to the performance of the
portfolio.

Prospectus 11
<PAGE>

FOREIGN EQUITY PORTFOLIOS (CONTINUED)

WRL JANUS GLOBAL
The portfolio's sub-adviser, Janus Capital Corporation (Janus) seeks to achieve
the portfolio's investment objective by investing principally in:

o Common stocks of foreign and domestic issuers
o Depositary receipts including ADRs, GDRs and EDRs

The portfolio may also use forward foreign currency contracts for hedging.

Janus' main strategy is to use a "bottom up" approach to build the portfolio's
portfolio. They seek to identify individual companies with earnings growth
potential that may not be recognized by the market at large.

Foreign securities are generally selected on a stock-by-stock basis without
regard to defined allocation among countries or geographic regions.

When evaluating foreign investments, Janus (in addition to looking at
individual companies) considers such factors as:

o Expected levels of inflation in various countries
o Government policies that might affect business conditions
o The outlook for currency relationships
o Prospects for economic growth among countries, regions or
geographic areas

WHAT IS A "BOTTOM-UP" APPROACH?
When portfolio managers use a "bottom-up" approach, they look primarily at
individual companies against the context of broader market factors.

[GRAPHIC OMITTED] RISKS OF INVESTING IN FOREIGN EQUITY PORTFOLIOS

The principal risks of investing in Foreign Equity Portfolios that may
adversely affect your investment are described below. (Not all of these risks
apply to each Foreign Equity Portfolio. See the chart below for the principal
risks of your portfolio.) Please note that there are many other circumstances
which could adversely affect your investment and prevent a portfolio from
achieving its objective, which are not described here. Please refer to the
section entitled "Explanation of Strategies and Risks" beginning on page 39,
and the Fund's SAI for more information about the risks associated with
investing in the Foreign Equity Portfolios.

PRINCIPAL RISKS
FOREIGN EQUITY PORTFOLIOS

PORTFOLIO
---------
WRL
GE/SCOTTISH
EQUITABLE WRL
INTERNATIONAL JANUS
RISKS EQUITY GLOBAL
- -----
STOCKS X X
FOREIGN SECURITIES X X
EMERGING MARKETS RISK X X
FORWARD FOREIGN CURRENCY
CONTRACTS X X
DEPOSITARY RECEIPTS X X
WARRANTS & RIGHTS X X
VALUE INVESTING RISK X
CONVERTIBLES X

o STOCKS
While stocks have historically outperformed other investments over the long
term, they tend to go up and down more dramatically over the shorter term.
These price movements may result from factors affecting individual companies,
certain industries or the securities market as a whole.

Because the stocks the portfolio holds fluctuate in price, the value of your
investment in the portfolio will go up and down.

o Changes in currency values
o Currency speculation
o Currency trading costs
o Different accounting and reporting practices
o Less information available to the public
o Less (or different) regulation of securities markets
o Greater complex business negotiations
o Less liquidity
o More fluctuations in prices
o Delays in settling foreign securities transactions
o Higher costs for holding shares (custodial fees)
o Higher transaction costs

Prospectus 12
<PAGE>

FOREIGN EQUITY PORTFOLIOS (CONTINUED)

o Vulnerability to seizure and taxes
o Political instability and small markets
o Different market trading days
o Forward foreign currency contracts for hedging

o EMERGING MARKETS RISK
Investing in the securities of issuers located in or principally doing business
in emerging markets bear foreign risks as discussed above. In addition, the
risks associated with investing in emerging markets are often greater than
investing in developed foreign markets. Specifically, the economic structures
in emerging markets countries are less diverse and mature than those in
developed countries, and their political systems are less stable. Investments
in emerging markets countries may be affected by national policies that
restrict foreign investments. Emerging market countries may have less developed
legal structures, and the small size of their securities markets and low
trading volumes can make investments illiquid and more volatile than
investments in developed countries. As a result, a portfolio investing in
emerging market countries may be required to establish special custody or other
arrangements before investing.

o FORWARD FOREIGN CURRENCY CONTRACTS
Hedging against a decline in the value of a currency does not eliminate
fluctuations in the prices of portfolio securities or prevent losses if the
prices of portfolio securities decline.

Such hedging transactions preclude the opportunity for gain if the value of the
hedging currency should rise. Forward contracts may, from time to time, be
considered illiquid, in which case they would be subject to the portfolio's
limitation on investing in illiquid securities.

If the portfolio manager's judgment of markets proves incorrect or the strategy
does not correlate well with a portfolio's investment, the use of such hedging
transactions could result in a loss regardless of whether the intent was to
reduce risk or increase return and may increase a portfolio's volatility. In
addition, in the event that non-exchange traded forward currency contracts are
used, such transactions could result in a loss if the counterparty to the
transaction does not perform as promised.

o CONVERTIBLES
As with all debt securities, the market value of convertibles tends to decline
as interest rates increase and, conversely, to increase as the interest rates
decline.

o WARRANTS AND RIGHTS
Warrants and rights may be considered more speculative than certain other types
of investments because they do not entitle a holder to the dividends or voting
rights for the securities that may be purchased. They do not represent any
rights in the assets of the issuing company.

Also, the value of a warrant or right does not necessarily change with the
value of the underlying securities. A warrant or right ceases to have value if
it is not exercised prior to the expiration date.

o DEPOSITARY RECEIPTS
Depositary receipts represent interests in an account at a bank or trust
company which holds equity securities. They are subject to some of the same
risks as direct investments in foreign securities, including currency risk. The
regulatory requirements with respect to depositary receipts that are issued in
sponsored and unsponsored programs are generally similar, but the issuers of
unsponsored depositary receipts are not obligated to disclose material
information in the U.S., and, therefore, such information may not be reflected
in the market value of the depositary receipts.

YOU MAY LOSE MONEY IF YOU INVEST IN ANY OF THE FOREIGN EQUITY PORTFOLIOS.

[GRAPHIC OMITTED] INVESTOR PROFILES

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
For the investor who seeks long-term capital growth through foreign
investments, and who is able to tolerate the significant risks in such
investments.

WRL JANUS GLOBAL
For the investor who seeks capital growth without being limited to investments
in U.S. securities, and who can tolerate the significant risks associated with
foreign investing.

Prospectus 13
<PAGE>

FOREIGN EQUITY PORTFOLIOS (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
- --------------------------------------------------------------------

[GRAPH OMITTED]

1997 1998
- ---- ----
7.50% 12.85%

HIGHEST AND LOWEST RETURN
(Quarterly 1997-1998)
- --------------------------------------------
QUARTER ENDED
Highest 16.39 % 12/31/98
Lowest (17.69)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ------------------------------------------------------------
SINCE
INCEPTION
1 YEAR (JANUARY 2, 1997)
WRL GE/Scottish Equitable
International Equity 12.85% 10.17%
Morgan Stanley Capital
International-Europe,
Asia & Far East
(MSCI-EAFE) 13.13% 6.36%

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

WRL JANUS GLOBAL
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1993 1994 1995 1996 1997 1998
- ---- ---- ---- ---- ---- ----
35.05% 0.25% 23.06% 27.74% 18.75% 30.01%

HIGHEST AND LOWEST RETURN
(Quarterly 1992-1998)
- --------------------------------------------
QUARTER ENDED
Highest 20.82 % 12/31/98
Lowest (16.52)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ---------------------------------------------------------------
SINCE
INCEPTION
1 YEAR 5 YEARS (DECEMBER 3, 1992)
WRL Janus Global 30.01% 19.46% 21.94%
Morgan Stanley
Capital
International
World Index 24.34% 16.11% 17.16%

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

Prospectus 14
<PAGE>

GROWTH EQUITY PORTFOLIOS

WRL SALOMON ALL CAP

WRL JANUS GROWTH (FORMERLY GROWTH PORTFOLIO)

WRL GOLDMAN SACHS GROWTH

WRL C.A.S.E. GROWTH (FORMERLY C.A.S.E. GROWTH PORTFOLIO)

WRL GE U.S. EQUITY (FORMERLY U.S. EQUITY PORTFOLIO)

WRL DREYFUS MID CAP

WRL NWQ VALUE EQUITY (FORMERLY VALUE EQUITY PORTFOLIO)

WRL T. ROWE PRICE DIVIDEND GROWTH

THIS RISK/RETURN SUMMARY BRIEFLY DESCRIBES EACH GROWTH EQUITY PORTFOLIO OF THE
FUND AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS. FOR FURTHER
INFORMATION ON THESE PORTFOLIOS, PLEASE READ THE SECTION ENTITLED "EXPLANATION
OF STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL SALOMON ALL CAP
This portfolio seeks capital appreciation.

WRL JANUS GROWTH
This portfolio seeks growth of capital.

WRL GOLDMAN SACHS GROWTH
This portfolio seeks long-term growth of capital.

WRL C.A.S.E. GROWTH
This portfolio seeks annual growth of capital through investment in companies
whose management, financial resources and fundamentals appear attractive on a
scale measured against each company's present value.

WRL GE U.S. EQUITY
This portfolio seeks long-term growth of capital.

WRL DREYFUS MID CAP
This portfolio seeks total investment returns (including capital appreciation
and income) which consistently outperform the S&P 400 Mid Cap Index.

WRL NWQ VALUE EQUITY
This portfolio seeks to achieve maximum, consistent total return with minimum
risk to principal.

WRL T. ROWE PRICE DIVIDEND GROWTH
This portfolio seeks to provide an increasing level of dividend income,
long-term capital appreciation, and reasonable current income through
investments primarily in dividend paying stocks.

WHAT IS A GROWTH EQUITY PORTFOLIO?

Each growth equity portfolio invests in the common stock of companies that
offer potentially rising share prices. These portfolios primarily aim to
provide capital appreciation (a rise in share price) rather than steady
income.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL SALOMON ALL CAP
The portfolio's sub-adviser, Salomon Brothers Asset Management Inc. (SBAM),
seeks to achieve the portfolio's investment objective by investing principally
in:

o Common stocks
o Convertible securities

Prospectus 15
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

To a lesser extent, the portfolio may invest in:

o Cash and cash equivalents

This portfolio is non-diversified. The portfolio will primarily invest in
common stocks, or securities convertible into or exchangeable for common
stocks, such as convertible preferred stocks or convertible debentures.

The portfolio's classification as "non-diversified" under the 1940 Act means
that the portfolio has the ability to take larger positions in a smaller number
of issuers. However, to meet federal tax requirements, at the close of each
quarter the portfolio may not have more than 25% of its total assets invested
in any one issuer and, with respect to 50% of its total assets, not more than
5% of its total assets invested in any one issuer.

In seeking capital appreciation, the portfolio may purchase securities of:
seasoned issuers; small companies; newer companies; and new issues. The
portfolio may be subject to wide fluctuations in market value. Portfolio
securities may have limited marketability or may be widely and publicly traded.

SBAM anticipates that the portfolio's investments generally will be in
securities of companies which it considers to reflect the following
characteristics:

o Undervalued share prices
o Special situations such as existing or possible changes in
management or management policies, corporate structure or control,
capitalization, regulatory environment, or other circumstances which
could be expected to favor earnings or market price of such company's
shares
o Growth potential due to technological advances, new methods in
marketing or production, new or unique products or services, changes in
demands for products or services or other significant new developments

SBAM uses a "bottom-up," fundamental research process to select the portfolio's
securities. They seek to identify individual companies with earnings growth
potential that may not be recognized by the market.

SBAM may take a temporary defensive position when the securities trading
markets or the economy are experiencing excessive volatility or a prolonged
general decline, or other adverse conditions exist. This may be inconsistent
with the portfolio's principal investment strategies. Under these
circumstances, the portfolio may be unable to pursue its investment objective.

WRL JANUS GROWTH
The Portfolio's sub-adviser, Janus Capital Corporation (Janus), seeks to
achieve the portfolio's objective by investing principally in:

o Common stocks

The portfolio's strategy is to invest almost all of its assets in common stock
at times when Janus believes the market environment favors such investing.

Janus generally takes a "bottom-up" approach to building the stock portfolio.
In other words, Janus seeks to identify individual companies with earnings
growth potential that may not be recognized by the stock market at large.

Although themes may emerge in the portfolio, securities are generally selected
without regard to any defined industry sector or other similarly defined
selection procedure. Realization of income is not a significant investment
consideration for the portfolio and any income realized on the portfolio's
investments is incidental to its objective.

Janus may take a temporary defensive position when the securities trading
markets or the economy are experiencing excessive volatility or a prolonged
general decline, or other adverse market conditions exist. This may be
inconsistent with the portfolio's principal investment strategies. Under these
circumstances, the portfolio may be unable to achieve its investment objective.

WRL GOLDMAN SACHS GROWTH
The portfolio's sub-adviser, Goldman Sachs Asset Management (GSAM), seeks to
achieve the portfolio's objective by investing principally in:

o Equity securities

The portfolio will invest at least 90% of total assets in a diversified
portfolio of equity securities that are considered by GSAM to have long-term
capital appreciation potential. Although the portfolio will invest primarily in
publicly traded U.S. securities, it may invest up to 10% of its total assets in
foreign securities,

Prospectus 16
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

including securities of issuers in emerging (developing) countries and
securities quoted in foreign currencies.

Equity securities for this portfolio are selected based on their prospects for
above-average growth. GSAM will select securities of growth companies trading,
in GSAM's opinion, at a reasonable price relative to other industries,
competitors and historical price/earnings multiples.

In order to determine whether a security has favorable growth prospects, GSAM
ordinarily looks for one or more of the following characteristics in relation
to the security's prevailing price:

o prospects for above average sales and earnings growth per share
o high return on invested capital
o free cash flow generation
o sound balance sheet, financial and accounting policies, and
overall financial strength
o strong competitive advantages
o effective research, product development, and marketing
o pricing flexibility
o strength of management
o general operating characteristics that will enable the company to
compete successfully in its marketplace

The portfolio generally will invest in companies whose earnings are believed to
be in a relatively strong growth trend, or, to a lesser extent, in companies in
which significant further growth is not anticipated, but whose market value per
share is thought to be undervalued.

WRL C.A.S.E. GROWTH
The portfolio's sub-adviser, C.A.S.E. Management, Inc. (C.A.S.E.), seeks to
achieve the portfolio's investment objective by investing principally in:

o Common stocks

o Preferred stocks

o Convertible stocks

Using proprietary forms of research, C.A.S.E. selects companies after
evaluating the current economic cycle, and identifying potentially attractive
sectors, industries and company-specific circumstances.

C.A.S.E. invests in common, preferred and convertible stocks of companies that
it believes show below-market risk, supported by below-market multiples, along
with above-average fundamentals. These fundamentals include return on equity,
price-to-earnings ratio and other balance sheet factors that contribute to
long-term capital growth.

The portfolio's assets are invested in companies whose stocks are traded on
national exchanges or over-the-counter markets. C.A.S.E. focuses on companies
that are fundamentally strong compared to other companies in the same industry,
the same sector and the broad market.

C.A.S.E. applies its proprietary forms of research to companies that exhibit
superior products and above-average growth rates along with sound management
and financials.

Each company selected for the portfolio is monitored against more than two
dozen measures of financial strength, including:

o insiders' activity
o market style leadership
o earnings surprise
o analysts' change in earnings projections
o return on equity
o 5-year earnings-per-share growth rate

Prospectus 17
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

o price-earnings ratio
o price-to-book ratio
o price-to-cash flow
o institutional activity and holdings
o relative strength price change
o price-to-200-day moving average
o price-to-historical rising inflation
o price-to-declining U.S. dollar
o earnings projected change
o quarterly earnings per-share growth rate

Stocks are sold when C.A.S.E. views them as overvalued, or when C.A.S.E. feels
the stocks have lost their strong fundamentals.

In seeking to achieve the investment objective of the portfolio, C.A.S.E. will
make investment decisions without giving consideration to the turnover rate of
the portfolio. As a result, the turnover rate of the portfolio may be higher
than other comparable portfolios. Consequently, the portfolio may incur higher
transaction related expenses than portfolios that do not engage in frequent
trading.

WRL GE U.S. EQUITY
The portfolio's sub-adviser, GE Investment Management Incorporated (GEIM),
seeks to meet the portfolio's investment objective by investing primarily in:

o Common and preferred stock

o Convertible securities (convertible preferred stock, convertible
bonds, convertible debentures, convertible notes)

o Depositary receipts (ADRs, EDRs and GDRs)

o Warrants and rights

GEIM, under normal conditions, invests at least 65% of its assets in equity
securities of U.S. companies. GEIM combines "value" and "growth" investment
management styles. As a result, the portfolio has characteristics similar to
the S&P 500, including capital appreciation and income. Stock selection is key
to the portfolio.

Through fundamental company research, the portfolio managers seek to identify
securities of large companies with characteristics such as: attractive
valuations, financial strength and high quality management focused on
generating shareholder value.

The portfolio may also invest to a lesser extent in foreign securities and debt
securities.

WRL DREYFUS MID CAP
The portfolio's sub-adviser, The Dreyfus Corporation (Dreyfus), seeks to
achieve the portfolio's investment objective by investing principally in:

o Common stocks of medium capitalization companies

To a lesser extent, Dreyfus may invest portfolio assets in:

o Common stocks of large and small capitalization companies,
including emerging (developing) and cyclical growth companies

Dreyfus seeks to have a diversified portfolio of the common stocks of
mid-capitalization companies which offer above-average potential for
appreciation based on its multi-factor evaluation approach. The multi-factor
evaluation approach centers around the ability to identify and dynamically
weigh the fundamental characteristics driving current market returns, and to
construct portfolios by actively selecting stocks possessing positive exposure
to these preferred characteristics.

Generally, the factors which drive the investment process can be classified
into three categories:

o Earnings momentum indicators

o Company financial attributes

o Relative Value Measures

WRL NWQ VALUE EQUITY
The portfolio's sub-adviser, NWQ Investment Management Company, Inc. (NWQ),
seeks to achieve its objective by investing principally in:

o Common stocks

To a lesser extent, NWQ may invest portfolio assets in:

o Money market and short-term instruments (Treasury Bills)

o ADRs and exchange listed foreign stocks

Prospectus 18
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

NWQ employs a value-oriented approach to investing, combining top-down and
bottom-up disciplines.

NWQ will use statistical measures to look for above-average stock valuations,
screening for below-average price-to-earnings and price-to-book ratios,
above-average dividend yields and strong financial stability.

NWQ also identifies those market sectors believed to benefit from long-term
positive fundamentals, and focuses on the companies within these sectors which
represent above-average statistical value and are undervalued when purchased.

The portfolio consists primarily of mid-capitalization to large capitalization
companies. NWQ considers the following when making a security selection:

o below-average price-to-earnings ratios

o below-average price-to-book

o strong financial stability

o industries/sectors with strong long-term fundamentals

o leading/strong market positions

o uses earnings averaged over both strong and weak periods in
evaluating cyclical companies

WRL T. ROWE PRICE DIVIDEND GROWTH
The portfolio's sub-adviser, T. Rowe Price Associates, Inc. (T. Rowe Price),
seeks to achieve the portfolio's objective by investing principally in:

o Dividend-paying common stocks with favorable prospects for
increasing dividends and long-term appreciation

To a lesser extent, T. Rowe Price may invest in:

o Foreign securities

o Futures

T. Rowe Price typically invests at least 65% of total assets in common stocks
of dividend-paying companies that it expects to increase their dividends over
time and also provide long-term appreciation.

T. Rowe Price believes that a track record of dividend increases is an
excellent indicator of financial health and growth prospects, and over the
long-term, income can contribute significantly to total return. Dividends can
also help reduce the portfolio's volatility during periods of market turbulence
and help offset losses when stock prices are falling.

T. Rowe Price looks for stocks with sustainable, above-average growth in
earnings and dividends, and attempts to buy them when they are temporarily out
of favor or undervalued by the market. In selecting investments,
T. Rowe Price favors companies with one or more of the following:

o Either a track record of, or the potential for, above-average
earnings and dividend growth
o A competitive current dividend yield
o A sound balance sheet and solid cash flow to support future
dividend increases
o A sustainable competitive advantage and leading market position
o Attractive valuations such as a relatively high dividend yield

While the portfolio invests primarily in common stocks, T. Rowe Price may also
purchase other securities including foreign securities, convertible securities,
warrants, preferred stocks, and corporate and government debt when considered
consistent with the portfolio's objective. Futures and options may be used for
any number of reasons, including: managing the portfolio's exposure to
securities prices and foreign currencies; to enhance income; to manage cash
flows efficiently; or to protect the value of portfolio securities.

The portfolio may sell securities for a variety of reasons such as to secure
gains, limit losses, or redeploy assets into more promising opportunities.

[GRAPHIC OMITTED] RISKS

The principal risks of investing in Growth Equity Portfolios that may adversely
affect your investment are described below. (Not all of these risks apply to
each Growth Equity Portfolio. See the chart below for the principal risks of
your portfolio.) Please note that there are many other circumstances which
could adversely affect your investment and prevent a portfolio from achieving
its objective, which are not described here.

Prospectus 19
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

Please refer to the section entitled "Explanation of Strategies and Risks,"
beginning on page 39, and the Fund's SAI for more information about the risks
associated with investing in the Growth Equity Portfolios.

PRINCIPAL RISKS
GROWTH EQUITY PORTFOLIOS

<TABLE>
<CAPTION>
PORTFOLIO
---------
WRL
WRL WRL T. ROWE
WRL WRL GOLDMAN WRL WRL WRL NWQ PRICE
SALOMON JANUS SACHS C.A.S.E. GE U.S. DREYFUS VALUE DIVIDEND
RISKS ALL CAP GROWTH GROWTH GROWTH EQUITY MID CAP EQUITY GROWTH
- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NON-DIVERSIFICATION X
STOCKS X X X X X X X X
MEDIUM SIZED COMPANIES X X
FOREIGN SECURITIES X X X X X
EMERGING MARKETS RISK X X X
CONVERTIBLES X X X X
PROPRIETARY RESEARCH X
STYLE RISK X X X X X X X X
FUTURES AND OPTIONS X X X
DEPOSITARY RECEIPTS X X X
WARRANTS & RIGHTS X X
DIVIDEND-PAYING COMPANIES X
</TABLE>

Because the stocks the portfolio holds fluctuate in price, the value of your
investment in the portfolio go up and down.

o MEDIUM-SIZED COMPANIES
These companies present additional risks because their earnings may be less
predictable, their share price more volatile, and their securities less liquid
than larger more established companies.

Prospectus 20
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

o More complex business negotiations
o Less liquidity
o More fluctuations in market prices
o Delays in settling foreign securities transactions
o Higher costs for holding foreign securities (custodial fees)
o Higher transaction costs
o Vulnerability to seizure and taxes
o Political instability and small markets
o Different market trading days

o CONVERTIBLES
As with all debt securities, the market value of convertibles tends to decline
as interest rates increase and, conversely, increase as interest rates decline.

o PROPRIETARY RESEARCH
Proprietary forms of research may not be effective and may cause overall
returns to be lower than if other forms of research are used.

o DIVIDEND-PAYING COMPANIES (WRL T. ROWE PRICE DIVIDEND GROWTH)
T. Rowe Price's emphasis on dividend-paying companies could result in a
concentration in large-capitalization stocks. At times, stocks such as these
may lag shares of smaller, faster-growing companies. The portfolio's efforts to
buy stocks that appear temporarily out of favor also carries the risk that a
stock or group of stocks may remain out of favor for a long time and may
continue to decline.

o STYLE RISK
Securities with different characteristics tend to shift in and out of favor
depending upon market and economic conditions as well as investor sentiment. A
portfolio may underperform other portfolios that employ a different style. A
portfolio also may employ a combination of styles that impact its risk
characteristics. Examples of different styles include growth and value
investing, as well as those focusing on large, medium, or small company
securities.

o GROWTH INVESTING RISK
Growth stocks may be more volatile than other stocks because they are
more sensitive to investor perceptions of the issuing company's growth
potential. Growth oriented funds will typically underperform when value
investing is in favor.

o Inaccurate market predictions

o Imperfect correlation

o Illiquidity

o Tax considerations

The portfolios are not required to hedge their investments.

Prospectus 21
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

YOU MAY LOSE MONEY IF YOU INVEST IN ANY OF THE GROWTH EQUITY PORTFOLIOS.

[GRAPHIC OMITTED] INVESTOR PROFILES

WRL SALOMON ALL CAP
For the investor who wants long-term growth of capital and who can tolerate the
risks of a non-diversified portfolio and fluctuations in their investment.

WRL JANUS GROWTH
For the investor who wants capital growth in a broadly diversified stock
portfolio, and who can tolerate significant fluctuations in value.

WRL GOLDMAN SACHS GROWTH
For the investor who seeks long-term growth of capital and who can tolerate
fluctuations inherent in stock investing.

WRL C.A.S.E. GROWTH
For the investor who seeks growth on a quarterly basis, but wants a diversified
portfolio that seeks to have investments in companies that have below market
risk characteristics. The investor should be comfortable with the price
fluctuations of a stock portfolio.

WRL GE U.S. EQUITY
For the investor who seeks long-term growth from a diversified portfolio that
combines "value" and "growth" investment management styles. As a result, the
portfolio will have characteristics similar to the S&P 500. The investor should
be comfortable with the price fluctuations of a stock portfolio and be willing
to accept higher short-term risk for potential long-term returns.

WRL DREYFUS MID CAP
For the investor who seeks total returns exceeding the S&P 400 Mid Cap Index
and who can tolerate fluctuations inherent to mid-cap stock investing.

WRL NWQ VALUE EQUITY
For the investor who seeks both capital preservation and long-term capital
appreciation and who can tolerate fluctuations inherent in stock investing.

WRL T. ROWE PRICE DIVIDEND GROWTH
For the investor who wants a reasonable level of current income from equity
investments that has the potential to rise faster than inflation, along with
capital appreciation and who can tolerate significant fluctuations in the value
of their investment.

Prospectus 22
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

Because the WRL Salomon All Cap, WRL Goldman Sachs Growth, WRL Dreyfus Mid Cap,
and WRL T. Rowe Price Dividend Growth portfolios commenced operations in 1999,
their performance history is not included.

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL JANUS GROWTH
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
47.04% (0.22)% 59.79% 2.35% 3.97% (8.31)% 47.12% 17.96% 17.54% 64.47%

HIGHEST AND LOWEST RETURN
(Quarterly 1988-1998)
- -------------------------------------------
QUARTER ENDED
Highest 28.73 % 12/31/98
Lowest (16.60)% 9/30/90

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- -----------------------------------------------------
1 YEAR 5 YEARS 10 YEARS
WRL Janus Growth 64.47% 25.20% 22.61%
S&P 500 Index 28.58% 24.06% 19.21%

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

WRL C.A.S.E. GROWTH
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1996 1997 1998
- ---- ---- ----
17.50% 15.03% 2.47%

HIGHEST AND LOWEST RETURN
(Quarterly 1995-1998)
- -------------------------------------------
QUARTER ENDED
Highest 26.60 % 12/31/98
Lowest (22.50)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ---------------------------------------------------
SINCE
INCEPTION
1 YEAR (MAY 1, 1995)
WRL C.A.S.E. Growth 2.47% 15.01%
Wilshire 5000 Index 21.72% 24.69%

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

Prospectus 23
<PAGE>

GROWTH EQUITY PORTFOLIOS (CONTINUED)

WRL GE U.S. EQUITY
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1997 1998
- ---- ----
27.01% 22.87%

HIGHEST AND LOWEST RETURN
(Quarterly 1997-1998)
- --------------------------------------------
QUARTER ENDED
Highest 19.59 % 12/31/98
Lowest (10.14)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ----------------------------------------------------
SINCE
INCEPTION
1 YEAR (JANUARY 2, 1997)
WRL GE U.S. Equity 22.87% 25.00%
S&P 500 Index 28.58% 31.13%

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

WRL NWQ VALUE EQUITY
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1997 1998
- ---- ----
25.04% -4.78%

HIGHEST AND LOWEST RETURN
(Quarterly 1996-1998)
- --------------------------------------------
QUARTER ENDED
Highest 13.44 % 6/30/97
Lowest (17.95)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ------------------------------------------------
SINCE
INCEPTION
1 YEAR (MAY 1, 1996)
WRL NWQ Value
Equity (4.78)% 11.83%
S&P 500 Index 28.58 % 28.96%

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

Prospectus 24
<PAGE>

BALANCED PORTFOLIOS

WRL DEAN ASSET ALLOCATION (FORMERLY TACTICAL ASSET ALLOCATION PORTFOLIO)

WRL LKCM STRATEGIC TOTAL RETURN (FORMERLY STRATEGIC TOTAL RETURN PORTFOLIO)

WRL J.P. MORGAN REAL ESTATE SECURITIES (FORMERLY REAL ESTATE SECURITIES
PORTFOLIO)

WRL FEDERATED GROWTH & INCOME (FORMERLY GROWTH & INCOME PORTFOLIO)

WRL AEGON BALANCED (FORMERLY BALANCED PORTFOLIO)

THIS RISK/RETURN SUMMARY BRIEFLY DESCRIBES EACH BALANCED PORTFOLIO OF THE FUND
AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS. FOR FURTHER INFORMATION
ON THESE PORTFOLIOS, PLEASE READ THE SECTION ENTITLED "EXPLANATION OF
STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL DEAN ASSET ALLOCATION
The objective of this portfolio is to seek preservation of capital and
competitive investment returns.

WRL LKCM STRATEGIC TOTAL RETURN
The objective of this portfolio is to provide current income, long-term growth
of income and capital appreciation.

WRL J.P. MORGAN REAL ESTATE SECURITIES
This portfolio seeks long-term total return from investments primarily in
equity securities of real estate companies. Total return will consist of
realized and unrealized capital gains and losses plus income.

WRL FEDERATED GROWTH & INCOME
This portfolio seeks total return by investing in securities that have
defensive characteristics. (These are securities that appear to have a low
probability of significant price decline relative to the overall equity market.
They also will, in the sub-adviser's view, generally have a comparatively low
volatility in share price relative to the overall equity market.)

WRL AEGON BALANCED
This portfolio seeks preservation of capital, reduced volatility, and superior
long-term risk-adjusted returns.

WHAT IS A BALANCED PORTFOLIO?
A balanced portfolio generally tries to balance three different objectives:
moderate long-term growth of capital, moderate income, and moderate
stability in an investor's principal. To reach these goals, balanced
portfolios invest in a mixture of stocks, bonds and money market
instruments.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL DEAN ASSET ALLOCATION
The portfolio's sub-adviser, Dean Investment Associates (Dean), seeks to
achieve the portfolio's investment objective by investing principally in:

o Income-producing common and preferred stocks

o Debt obligations of U.S. issuers, some of which will be
convertible into common stocks

o U.S. Treasury bonds, notes and bills

o Money market funds

In selecting stocks, Dean focuses on high-quality, liquid, large capitalization
stocks, using a bottom-up screening process to identify stocks that are
statistically undervalued. Dean's ultimate goal is to choose stocks whose price
has been driven down by a market that has over-reacted to perceived risks. With
this approach, the

Prospectus 25
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

portfolio seeks to achieve a dividend income yield higher than that of the
Russell 1000 Index, a widely recognized unmanaged index of market performance
which measures the performance of the 1,000 largest companies in the Russell
3000 Index, which represents approximately 89% of the total market
capitalization of the Russell 3000 Index. As of the latest reconstitution, the
average market capitalization was approximately $9.9 billion; the median market
capitalization was approximately $3.7 billion. The smallest company in the
index had an approximate market capitalization of $1,404.7 million.

Dean employs an investment technique called "asset allocation," which shifts
assets from one class of investment to another (such as from equity to debt)
when it anticipates changes in market direction.

Dean will seek to enhance returns in rising stock markets by increasing its
allocation to equity, then protect itself in falling stock markets by reducing
equity exposure and shifting into fixed-income investments, as well as into
money market funds (up to 10% of total assets).

Dean has developed forecasting models to predict movements in the stock market
for both short (12 to 18-month) and long (3 to 5-year) time periods. These
models help compare the risks and rewards Dean anticipates in holding stocks
versus debt instruments and money market funds. Such techniques may result in
increased portfolio expenses such as brokerage fees.

Thus, the models determine when Dean is to "tactically" adjust the portfolio's
asset allocation among stocks, bonds, U.S. debt obligations and money market
funds.

WRL LKCM STRATEGIC TOTAL RETURN
The portfolio's sub-adviser, Luther King Capital Management Corporation (LKCM),
seeks to achieve the portfolio's investment objective by investing primarily
in:

o Common stocks

o Corporate bonds

o Convertible preferred stocks

o Corporate convertible bonds

o U.S. Treasury Notes

The portfolio seeks to invest in a blend of equity and fixed-income securities
to achieve a balance of capital appreciation and investment income while
limiting volatility. The portfolio will also invest in convertible securities,
which have both equity and fixed-income characteristics. In choosing such
securities, LKCM looks for companies with strong fundamental characteristics.
It considers factors such as:

o balance sheet quality
o cash flow generation
o earnings and dividend growth record and outlook
o profitability levels

In some cases, LKCM bases its selections on other factors. For example, some
securities may be bought at an apparent discount to their appropriate value,
with the anticipation that they'll increase in value over time.

The portfolio seeks to achieve an income yield greater than the average yield
of the stocks in the S&P 500.

The portfolio invests mainly in the stocks and bonds of companies with
established operating histories and strong fundamental characteristics. The
majority of the stocks the portfolio buys will be listed on a national exchange
or traded on NASDAQ or domestic over-the-counter markets.

LKCM closely analyzes a company's financial status and a security's valuation
in an effort to control risk at the individual level. In addition, the growth
elements of the portfolio's equity investments drive capital appreciation.

As part of its income-oriented strategy, LKCM expects to invest about 25% of
the portfolio's assets in fixed-income securities, some of which will be
convertible into common stocks, and no more than 20% of its assets in stocks
that don't pay a dividend.

WRL J.P. MORGAN REAL ESTATE SECURITIES
This portfolio's sub-adviser, J.P. Morgan Investment Management Inc. (J.P.
Morgan), seeks to achieve the portfolio's objective by investing principally in
equity securities of real estate companies which include:

o Common stocks

o Convertible securities

Prospectus 26
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

Under normal conditions, J.P. Morgan invests at least 65% of portfolio assets
in real estate company securities. A company is considered to be a real estate
company if at least 50% of its revenues or at least 50% of the market value of
its assets is attributable to the ownership, construction, management or sale
of residential, commercial or industrial real estate.

Companies chosen are generally contained in the National Association of Real
Estate Investment Trusts (NAREIT) Equity without Healthcare Index. Based on
internal fundamental equity and real estate research, and using a dividend
discount model, J.P. Morgan ranks these companies within four broad sectors of
the real estate industry from undervalued to overvalued. From this target
universe, J.P. Morgan selects stocks for the portfolio based on a variety of
criteria including managerial strength, geographic diversification, prospects
for growth and the company's competitive position.

The portfolio may also invest in debt securities of real estate and non-real
estate companies, mortgage-backed securities such as pass through certificates,
real estate mortgage investment conduit (REMIC) certificates, and
collateralized mortgage obligations (CMOs), or short-term debt obligations.
However, the portfolio does not directly invest in real estate.

The portfolio is non-diversified under federal securities laws.

WRL FEDERATED GROWTH & INCOME
The portfolio's sub-adviser, Federated Investment Counseling (Federated), seeks
to achieve the portfolio's objective by investing principally in:

o Common stocks

o Convertible securities

o REITs

o Fixed income securities

o Foreign securities

Federated seeks total return by investing primarily in common stocks that
provide the opportunity for capital appreciation or high dividend income.
Federated seeks capital appreciation by investing primarily in undervalued,
overlooked common stocks. These securities are generally trading at low
historical valuations, relative to the market and to industry peers, which do
not reflect positive changes in the companies' outlook. To achieve high current
income, Federated seeks to invest in securities that offer higher dividends
than the overall market. Convertible stocks and bonds, real estate investment
trusts and securities issued by utility companies are generally the types of
securities that Federated may emphasize in order to enhance the portfolio's
dividend income. Federated may also invest a portion of the portfolio's assets
in securities of companies based outside the U.S. to diversify the portfolio's
holdings and to gain exposure to the foreign market.

Federated attempts to invest in securities that have defensive characteristics
by selecting securities that appear to have a low probability of significant
price decline relative to the overall equity market. In Federated's opinion,
these securities generally will have a comparatively low volatility in share
price relative to the overall equity market. Federated also may emphasize
investments in securities that provide high dividend income to seek to invest
in less volatile equity securities. Federated also may allocate a portion of
the assets in cash or government securities when the markets appear to be
overpriced.

To identify companies for portfolio investment, Federated uses a model which
looks at a company's financial and earnings strength, management skill and
business prospects, and at the prospect of comparatively low volatility in
share price. In addition, Federated performs traditional fundamental and credit
analyses to select the most promising companies for the portfolio. Federated
may emphasize investments in certain industry sectors that offer securities
that have these attributes. To determine the timing of purchases and sales of
portfolio securities, Federated looks at recent stock price performance.

Prospectus 27
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

WRL AEGON BALANCED
This portfolio's sub-adviser, AEGON USA Investment Management, Inc. (AIMI),
seeks to achieve the portfolio's objective by investing principally in:

o Common stocks (primarily of domestic large cap companies)

o U.S. Treasuries

o Convertible securities

AIMI uses a top-down investment strategy to find stocks of medium to large
capitalization companies that fit a value criteria. The process for selecting
companies is based on fundamental analysis.

More specifically, AIMI looks at the industry structure, organizational
structure, financial structure, and business prospects of each portfolio
company. It then applies the analysis of these factors to financial forecasts
which, in turn, drives the valuation of a company's stock. AIMI uses a two
stage dividend discount model to value a company. Once AIMI initiates a
position it monitors and continually reassesses its prior analysis. When AIMI
believes the price fully reflects its independent valuation or there is a
significant change in the fundamentals of the company, the portfolio sells the
security.

[GRAPHIC OMITTED] RISKS

The principal risks of investing in Balanced Portfolios that may adversely
affect your investment are described below. (Not all of these risks apply to
each Balanced Portfolio. See the chart below for the principal risks of your
portfolio.) Please note that there are many other circumstances that could
adversely affect your investment and prevent a portfolio from achieving its
objective, which are not described here. Please refer to the section entitled
"Explanation of Strategies and Risks," beginning on page 39 and the Fund's SAI
for more information about the risks associated with investing in Balanced
Portfolios.

PRINCIPAL RISKS
BALANCED PORTFOLIOS

<TABLE>
<CAPTION>
PORTFOLIO
---------
WRL
WRL LKCM WRL WRL
DEAN STRATEGIC J.P. MORGAN FEDERATED WRL
ASSET TOTAL REAL ESTATE GROWTH & AEGON
RISKS ALLOCATION RETURN SECURITIES INCOME BALANCED
- -----
<S> <C> <C> <C> <C> <C>
STOCKS X X X X X
FIXED-INCOME SECURITIES X X X
CONVERTIBLES X X X
REAL ESTATE SECURITIES X X
QUANTITATIVE MODELS X
NON-DIVERSIFIED X
FOREIGN SECURITIES X
DEPOSITARY RECEIPTS X
</TABLE>

o STOCKS
While stocks have historically outperformed other investments over the long
term, they tend to go up and down more dramatically over the short term. These
price movements may result from factors affecting individual companies,
industries or the securities market as a whole.

Because the stocks a portfolio holds fluctuate in price, the value of your
investment in a portfolio will go up and down.

o FIXED-INCOME SECURITIES
The value of these securities may change daily based on changes in the interest
rate, and other market conditions and factors. The risks include:

o Changes in interest rates
o Length of time to maturity
o Issuers defaulting on their obligations to pay interest or return
principal

Prospectus 28
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

o HIGH-YIELD/HIGH-RISK FIXED-INCOME SECURITIES

o Credit risk
o Greater sensitivity to interest rate movements
o More speculative than higher rated securities
o Greater vulnerability to economic changes
o Decline in market value in event of default
o Less liquidity

o CONVERTIBLES
As with all debt securities, the market value of convertibles tends to decline
as interest rates increase and, conversely, to increase as interest rates
decline.

o REAL ESTATE SECURITIES
Investments in the real estate industry are subject to risks associated with
direct investment in real estate. These risks may include:

o Declining real estate value
o Risks relating to general and local economic conditions
o Over-building
o Increased competition for assets in local and regional markets
o Increases in property taxes
o Increases in operating expenses or interest rates
o Change in neighborhood value or the appeal of properties to
tenants
o Insufficient levels of occupancy
o Inadequate rents to cover operating expenses

The performance of securities issued by companies in the real estate industry
also may be affected by prudent management of insurance risks, adequacy of
financing available in capital markets, competent management, changes in
applicable laws and government regulations (including taxes) and social and
economic trends.

o QUANTITATIVE MODELS
Securities selected using statistical models may result in incorrect asset
allocations causing overall returns to be lower than if other methods of
selection were used.

o NON-DIVERSIFIED
To the extent a portfolio invests a greater proportion of its assets in the
securities of a smaller number of issuers, it may be more susceptible to any
single economic, political or regulatory occurrence than a more widely
diversified portfolio and may be subject to greater risks of loss with respect
to its portfolio securities.

YOU MAY LOSE MONEY IF YOU INVEST IN ANY OF THE BALANCED PORTFOLIOS

[GRAPHIC OMITTED] INVESTOR PROFILES

WRL DEAN ASSET ALLOCATION
For the investor who wants a combination of capital growth and income, and who
is comfortable with the risks associated with an actively traded portfolio
which shifts assets between equity and debt.

WRL LKCM STRATEGIC
TOTAL RETURN
For the investor who wants current income with the prospect of income growth,
plus the prospect of capital growth. The investor should be comfortable with
the price fluctuations of a portfolio that invests in both equity and
fixed-income securities.

WRL J.P. MORGAN REAL
ESTATE SECURITIES
For the investor who seeks long-term total return consisting of current income
and, potentially, capital appreciation. The investor should be comfortable with
the risk of a non-diversified portfolio invested primarily in securities of
real estate companies and their exposure to real estate markets.

WRL FEDERATED GROWTH & INCOME
For the investor who seeks high current income and moderate capital
appreciation and is willing to accept certain special risks associated with
sector investing. (A sector is a broad grouping of specific industries.)

WRL AEGON BALANCED
For the investor who wants capital growth and income from the same investment,
but who also wants an investment which has the prospect of sustaining its
interim principal value through maintaining a balance between equity and debt.
This portfolio is not designed for investors who desire a consistent level of
income.

Prospectus 29
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

Because the WRL J.P. Morgan Real Estate Securities portfolio commenced
operations in mid-1998, its performance history is not included.

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL DEAN ASSET ALLOCATION
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1995 1996 1997 1998
- ---- ---- ---- ----
20.09% 14.42% 16.59% 8.33%

HIGHEST AND LOWEST RETURN
(Quarterly 1995-1998)
- ------------------------------------------
QUARTER ENDED
Highest 9.03 % 6/30/97
Lowest (6.01)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- -------------------------------------------------
SINCE
INCEPTION
1 YEAR (JANUARY 3, 1995)
WRL Dean Asset
Allocation 8.33% 14.80%
S&P 500 Index 28.58% 30.59%

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

WRL LKCM STRATEGIC TOTAL RETURN
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1994 1995 1996 1997 1998
- ---- ---- ---- ---- ----
(0.53)% 24.66% 15.00% 21.85% 9.64%

HIGHEST AND LOWEST RETURN
(Quarterly 1993-1998)
- -------------------------------------------
QUARTER ENDED
Highest 13.06 % 6/30/97
Lowest (8.05)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ---------------------------------------------------------------
SINCE
INCEPTION
1 YEAR 5 YEARS (MARCH 1, 1993)
WRL LKCM Strategic
Total Return 9.64% 13.76% 14.12%
S&P 500 Index 28.58% 24.06% 21.81%

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

Prospectus 30
<PAGE>

BALANCED PORTFOLIOS (CONTINUED)

WRL FEDERATED GROWTH & INCOME
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1995 1996 1997 1998
- ---- ---- ---- ----
25.25% 11.64% 24.65% 3.05%

HIGHEST AND LOWEST RETURN
(Quarterly 1994-1998)
- ------------------------------------------
QUARTER ENDED
Highest 9.72 % 12/31/96
Lowest (2.61)% 9/30/96

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ----------------------------------------------------
SINCE
INCEPTION
1 YEAR (MARCH 1, 1994)
WRL Federated
Growth & Income 3.05% 1.78%
Russell 3000 Index 22.32% 20.51%

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

WRL AEGON BALANCED
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1995 1996 1997 1998
- ---- ---- ---- ----
19.80% 10.72% 17.10% 6.93%

HIGHEST AND LOWEST RETURN
(Quarterly 1994-1998)
- ------------------------------------------
QUARTER ENDED
Highest 9.84 % 12/31/98
Lowest (6.56)% 9/30/98

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- -----------------------------------------------
SINCE
INCEPTION
1 YEAR (MARCH 1, 1994)
WRL AEGON
Balanced 6.93% 9.71%
S&P 500 Index 28.58% 24.80%

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

Prospectus 31
<PAGE>

FIXED-INCOME PORTFOLIO(S)

WRL AEGON BOND (FORMERLY BOND PORTFOLIO)

THIS RISK/REWARD SUMMARY BRIEFLY DESCRIBES EACH FIXED-INCOME PORTFOLIO OF THE
FUND AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIO(S). FOR FURTHER
INFORMATION ON THE PORTFOLIO(S), PLEASE READ THE SECTION ENTITLED "EXPLANATION
OF STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL AEGON BOND
This Portfolio seeks the highest possible current income within the confines of
the primary goal of ensuring the protection of capital.

WHAT IS A FIXED-INCOME PORTFOLIO?
Fixed-income portfolios primarily invest in debt securities that pay
interest. When the debt security is purchased, the portfolio owns "debt"
and becomes an indirect creditor to the company or government that issued
the bond.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL AEGON BOND
The portfolio's sub-adviser, AEGON USA Investment Management, Inc. (AIMI) seeks
to achieve the portfolio's objective by investing principally in:

o U.S. government securities obligations, including Treasury and
Agency Securities

o Medium to high-quality corporate bonds

To a lesser extent AIMI may invest in:

o Mortgage-backed securities, including pass-through and
Collateralized Mortgage Obligations (CMOs)

o Asset-backed securities

o U.S. dollar-denominated foreign bonds

o Short-term securities, including agency discount notes and
commercial paper

AIMI takes an approach in the daily management of the portfolio that it
considers to be conservative, striving to participate in the bond market's
advances while preserving capital on the downside.

AIMI uses its Core Fixed-Income Strategy through which it draws from all of its
organizational resources. AIMI utilizes a disciplined process to gather
information on key factors for evaluation of the market environment.

The Fixed-Income Strategy Committee then sets policy directives that reflect
AIMI's interest rate outlook and expectations for the relative performance of
the major bond market sectors.

AIMI then selects securities that are considered by it to be most appropriate
based on AIMI's findings.

[GRAPHIC OMITTED] RISKS

The principal risks of investing in the Fixed-Income Portfolio that may
adversely affect your investment are described below. Please note that there
are many other circumstances that could adversely affect your investment and
prevent a portfolio from achieving its objective, which are not described here.
Please refer to the section entitled "Explanation of Strategies and Risks"
beginning on page 39 and the Fund's SAI for more information about the risks
associated with investing in the Fixed-Income Portfolio.

o FIXED-INCOME SECURITIES
The value of these securities may change daily based on changes in interest
rates, and other market conditions and factors. The risks include:

o Changes in interest rates
o Length of time to maturity
o Issuers defaulting on their obligations to pay interest or return
principal (Credit Risk)

Prospectus 32
<PAGE>

FIXED-INCOME PORTFOLIO(S) (CONTINUED)

o HIGH-YIELD/HIGH-RISK FIXED-INCOME SECURITIES

o Credit risk
o Greater sensitivity to interest rate movements than higher rated
securities
o More speculative than higher rated securities
o Greater vulnerability to economic changes
o Decline in market value in event of default
o Less liquidity

o CREDIT RISK
The price of a bond is affected by the issuer's or counterparty's credit
quality. Changes in financial condition and general economic conditions can
affect the ability to honor financial obligations and therefore credit quality.
Lower quality bonds are generally more sensitive to these changes than higher
quality bonds. Even within securities considered investment grade, differences
exist in credit quality and some investment grade debt securities may have
speculative characteristics. A security's price may be adversely affected by
the market's opinion of the security's credit quality level even if the issuer
or counterparty has suffered no degradation in ability to honor the obligation.

o INTEREST RATE RISK
Bond prices rise when interest rates decline and decline when interest rates
rise. The longer the duration of a bond, the more a change in interest rates
affects the bond's price. Short-term and long-term interest rates may not move
the same amount and may not move in the same direction, which may affect the
sub-adviser's ability to predict interest rate movements and select portfolio
investments.

o MORTGAGE- AND OTHER ASSET-BACKED SECURITIES

o Repayment sooner than stated maturity dates resulting in greater
price and yield volatility than with traditional fixed-income securities
o Prepayments resulting in lower return
o Values may change based on creditworthiness of issuers
o Interest rate risks

o PROPRIETARY RESEARCH
AIMI's proprietary forms of research may not be effective and may cause overall
returns to be lower than if other forms of research are used.

YOU MAY LOSE MONEY IF YOU INVEST IN THIS PORTFOLIO.

[GRAPHIC OMITTED] INVESTOR PROFILE

WRL AEGON BOND
For the investor seeking current income with preservation of capital, and who
can tolerate the fluctuation in principal associated with changes in interest
rates.

Prospectus 33
<PAGE>

FIXED-INCOME PORTFOLIO(S) (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

The bar chart and table below gives an indication of the portfolio's risks and
performance. The chart shows changes in the portfolio's performance from year
to year. The performance calculations do not reflect charges or deductions
under the policies or the annuity contracts. These fees and expenses would
lower investment performance. The table shows how the portfolio's average
annual returns for the periods indicated compare to those of a broad measure of
market performance.

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL AEGON BOND
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
14.65% 6.21% 18.85% 6.79% 13.38% -6.94% 22.99% 0.14% 9.16% 9.32%

HIGHEST AND LOWEST RETURN
(Quarterly 1988-1998)
- ------------------------------------------
QUARTER ENDED
Highest 10.39 % 6/30/89
Lowest (4.90)% 3/31/94

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- -----------------------------------------------------------
1 YEAR 5 YEARS 10 YEARS
WRL AEGON Bond 9.32% 6.46% 9.14%
Lehman Brothers
Government/Corporate
Bond
(LBGC) Index 9.47% 7.31% 9.34%

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

Prospectus 34
<PAGE>

CAPITAL PRESERVATION PORTFOLIO(S)

WRL J.P. MORGAN MONEY MARKET (FORMERLY MONEY MARKET PORTFOLIO)

THIS RISK/RETURN SUMMARY BRIEFLY DESCRIBES THE CAPITAL PRESERVATION
PORTFOLIO(S) AND THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIO. FOR FURTHER
INFORMATION ON THE PORTFOLIOS(S), PLEASE READ THE SECTION ENTITLED "EXPLANATION
OF STRATEGIES AND RISKS," BEGINNING ON PAGE 39, AND THE FUND'S SAI.

[GRAPHIC OMITTED] OBJECTIVES

WRL J.P. MORGAN MONEY MARKET
This portfolio seeks to obtain maximum current income consistent with
preservation of principal and maintenance of liquidity.

WHAT IS A MONEY MARKET PORTFOLIO?
A money market portfolio tries to maintain a share price of $1.00 while
paying income to its shareholders. A stable share price protects your
investment from loss ("preservation of principal"). If you need to sell
your shares at any time, you should receive your initial investment plus
any income that you have earned (thereby providing "liquidity"). However, a
money market portfolio does not guarantee that you will receive your money
back.

A money market portfolio must follow SEC rules as to the investment
quality, maturity, diversification and other features of the securities it
purchases and the average remaining maturity of the securities cannot be
greater than 90 days. The remaining maturity of a security is the period of
time until the principal amount must be repaid.

[GRAPHIC OMITTED] POLICIES AND STRATEGIES

WRL J.P. MORGAN MONEY MARKET
The portfolio's sub-adviser, J.P. Morgan Investment Management Inc. (J.P.
Morgan) seeks to achieve the portfolio's objective by investing in:

o U.S. government obligations

o Domestic and certain foreign bank obligations including time
deposits, certificates of deposit, bankers' acceptances and other bank
obligations

o Asset-backed securities

o Repurchase and reverse repurchase agreements

J.P. Morgan will limit its investments to securities that present minimum
credit risks, as determined by guidelines adopted by the Fund's Board. The
portfolio may invest up to 25% of its total assets in securities of a single
issuer if the securities will not be held for more than three business days.

The Fund's Board must approve or ratify any purchase of an unrated security or
a security rated by only one nationally recognized statistical rating
organization (NRSRO).

[GRAPHIC OMITTED] RISKS

The principal risks of investing in the WRL J.P. Morgan Money Market portfolio
that may adversely affect your investment are described below. Please note that
there are circumstances which could adversely affect your investment and
prevent a portfolio from achieving its objective, which are not described here.
Please refer to the section entitled "Explanation of Strategies and Risks,"
beginning on page 39 and the Fund's SAI for more information about the risks
associated with investing in the Capital Preservation Portfolio(s).

o U.S. GOVERNMENT OBLIGATIONS
The value of the U.S. government securities will fluctuate with changing
interest rates. A decrease in interest rates generally results in an increase
in the value of the securities and an increase in interest rates have the
opposite effect.

o BANK OBLIGATIONS
Banks are subject to extensive governmental regulations that may affect an
investment. The profitability of this industry is dependent on the availability
and cost of capital funds for lending under prevailing money market conditions.

Economic conditions and credit losses also affect this type of investment.

Prospectus 35
<PAGE>

CAPITAL PRESERVATION PORTFOLIO(S) (CONTINUED)

o ASSET-BACKED SECURITIES

o REPURCHASE AND REVERSE REPURCHASE AGREEMENTS

A repurchase agreement involves the purchase of a security by a portfolio and a
simultaneous agreement (generally from a bank or broker-dealer) to repurchase
that security back from the portfolio at a specified price and date upon
demand. Repurchase agreements not terminable within seven days are considered
illiquid securities.

Repurchase agreements involve the risk that the seller will fail to repurchase
the security, as agreed. In that case, the portfolio will bear the risk of
market value fluctuations until the security can be sold and may encounter
delays and incur costs in liquidating the security. In the event of bankruptcy
or insolvency of the seller, delays and costs are incurred.

A portfolio invests in a reverse repurchase agreement when it sells a portfolio
security to another party, such as a bank or broker-dealer, in return for cash,
and agrees to buy the security back at a future date and price. While a reverse
repurchase agreement is outstanding, a portfolio will segregate with its
custodian cash and other liquid assets to cover its obligation under the
agreement. Reverse repurchase agreements are considered a form of borrowing by
the portfolio for purposes of the 1940 Act.

Reverse repurchase agreements may expose a portfolio to greater fluctuations in
the value of its assets.

Portfolio shares are not deposits or obligations of, or guaranteed or endorsed
by, any bank, and are not federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board, or any other agency of the U.S.
government. ALTHOUGH THE PORTFOLIO SEEKS TO PRESERVE THE VALUE OF YOUR
INVESTMENT AT $1.00 PER SHARE THERE IS NO GUARANTEE THAT IT WILL BE ABLE TO DO
SO. YOU MAY LOSE MONEY IF YOU INVEST IN THIS PORTFOLIO.

[GRAPHIC OMITTED] INVESTOR PROFILES

WRL J.P. MORGAN MONEY MARKET
For the investor who seeks current income, preservation of capital and
maintenance of liquidity.

Prospectus 36
<PAGE>

CAPITAL PRESERVATION PORTFOLIO(S) (CONTINUED)

[GRAPHIC OMITTED] PORTFOLIO PERFORMANCE

The bar chart and table below gives an indication of the portfolio's risks and
performance. The chart shows changes in the portfolio's performance from year
to year. The performance calculations do not reflect charges or deductions
under the policies or the annuity contracts. These fees and expenses would
lower investment performance. The table shows how the portfolio's average
annual return for the periods indicated compare to those of a broad measure of
market performance.

WHEN YOU CONSIDER THIS INFORMATION, PLEASE REMEMBER THAT A PORTFOLIO'S
PERFORMANCE IN PAST YEARS IS NOT NECESSARILY AN INDICATION OF HOW A PORTFOLIO
WILL DO IN THE FUTURE.

WRL J.P. MORGAN MONEY MARKET
- --------------------------------------------------------------------------------

[GRAPH OMITTED]

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
8.09% 7.09% 5.25% 3.03% 2.45% 3.44% 5.40% 5.03% 5.24% 5.26%

HIGHEST AND LOWEST RETURN
(Quarterly 1988-1998)
- -------------------------------------
QUARTER ENDED
Highest 2.19% July 31, 1989
Lowest 0.56% April 30, 1993

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

AVERAGE ANNUAL TOTAL RETURNS
(through December 31, 1998)
- ----------------------------------------------------------------------------
1 YEAR 5 YEARS 10 YEARS
WRL J.P. Morgan
Money Market 5.26% 4.87% 5.01%
- --------------------------------------------------------------------------------
7 DAY YIELD
- --------------------------------------------------------------------------------
As of December 31, 1998 4.96%

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

Prospectus 37
<PAGE>

RISK/REWARD INFORMATION

BEFORE YOU CHOOSE AN INVESTMENT PORTFOLIO,
PLEASE CONSIDER . . .

All of the investment portfolios involve risk, but there is also the potential
for reward. You can lose money -- and you can make money. The Fund portfolios
are structured so that each offers a slightly different degree of risk and
reward than others.

In this prospectus, we've arranged the portfolios in order of risk/
reward from highest to lowest. Notice the scale at the right. It covers the
full spectrum of risk/reward of the portfolios described in this prospectus.

WHAT RISK/REWARD LEVEL IS FOR YOU? ASK YOURSELF THE FOLLOWING:

(1) HOW WELL DO I HANDLE FLUCTUATIONS IN MY ACCOUNT VALUE?
The higher a portfolio is on the risk/reward spectrum, the more its
price is likely to move up and down on a day to day basis. If this makes
you uncomfortable, you may prefer an investment at the lower end of the
scale that may not fluctuate in price as much.

(2) AM I LOOKING FOR A HIGHER RATE OF RETURN?
Generally, the higher the potential return, the higher the risk. If you
find the potential to make money is worth the possibility of losing
more, then a portfolio at the higher end of the spectrum may be right
for you.

A final note: These portfolios are designed for long-term investment.

Each portfolio has an investment objective that it tries to achieve by
following certain investment strategies and techniques. The objective can be
changed without shareholder vote.

[GRAPHIC OMITTED]
WRL VKAM EMERGING GROWTH
WRL T. ROWE PRICE SMALL CAP
WRL GOLDMAN SACHS SMALL CAP
WRL PILGRIM BAXTER MID CAP GROWTH
WRL ALGER AGGRESSIVE GROWTH
WRL THIRD AVENUE VALUE

WRL GE/SCOTTISH EQUITABLE
INTERNATIONAL EQUITY
WRL JANUS GLOBAL

WRL SALOMON ALL CAP
WRL JANUS GROWTH
WRL GOLDMAN SACHS GROWTH
WRL C.A.S.E. GROWTH
WRL GE U.S. EQUITY
WRL DREYFUS MID CAP
WRL NWQ VALUE EQUITY
WRL T. ROWE PRICE DIVIDEND GROWTH

WRL DEAN ASSET ALLOCATION
WRL LKCM STRATEGIC TOTAL RETURN
WRL J.P. MORGAN REAL
ESTATE SECURITIES
WRL FEDERATED GROWTH & INCOME
WRL AEGON BALANCED

WRL AEGON BOND

WRL J.P. MORGAN MONEY MARKET

Prospectus 38
<PAGE>

EXPLANATION OF STRATEGIES AND RISKS

HOW TO USE THIS SECTION

In the discussions of the individual portfolios on pages 2 through 37, you
found descriptions of the strategies and risks associated with each. In those
pages, you were referred to this section for a more complete description of the
risks. For best understanding, first read the description of the portfolio
you're interested in. Then refer to this section and read about the risks
particular to that portfolio. For even more discussions of strategies and
risks, see the SAI, which is available upon request. See the back cover of this
prospectus for information on how to order the SAI.

[GRAPHIC OMITTED]
DIVERSIFICATION AND CONCENTRATION. The 1940 Act classifies investment companies
as either diversified or non-diversified.

Diversification is the practice of spreading a portfolio's assets over a number
of investments, investment types, industries or countries to reduce risk. A
non-diversified portfolio has the ability to take larger positions in fewer
issuers. Because the appreciation or depreciation of a single security may have
a greater impact on the net asset value of a non-diversified portfolio, its
share price can be expected to fluctuate more than a comparable portfolio.

All of the portfolios (except WRL Salomon All Cap, WRL Third Avenue Value, and
WRL J.P. Morgan Real Estate Securities) qualify as diversified funds under the
1940 Act. The diversified portfolios are subject to the following
diversification requirements (which are set forth in full in the SAI):

o As a fundamental policy, with respect to 75% of the total assets
of a portfolio, the portfolio may not own more than 10% of the outstanding
voting shares of any issuer (other than U.S. government securities) as
defined in the 1940 Act and, with respect to some portfolios, in other
types of cash items.

o As a fundamental policy, with respect to 75% of the total assets
of a portfolio, the portfolio will not purchase a security of any issuer
if such would cause the portfolio's holdings of that issuer to amount to
more than 5% of the portfolio's total assets.

o As a fundamental policy governing concentration, no portfolio
will invest more than 25% of its assets in any one particular industry,
other than U.S. government securities.

WRL Salomon All Cap, WRL Third Avenue Value and WRL J.P. Morgan Real Estate
Securities each reserves the right to become a diversified investment company
(as defined by the 1940 Act).

[GRAPHIC OMITTED]
INVESTING IN COMMON STOCKS. Many factors cause common stocks to go up and down
in price. A major one is the financial performance of the company that issues
the stock. Other factors include the overall economy, conditions in a
particular industry, and monetary factors like interest rates. When your
portfolio holds stocks, there's a risk that some or all of them may be down in
price when you choose to sell, causing you to lose money. This is called MARKET
RISK.

[GRAPHIC OMITTED]
INVESTING IN PREFERRED STOCKS. Because these stocks come with a promise to pay
a stated dividend, their price depends more on the size of the dividend than on
the company's performance. But if a company fails to pay the dividend, its
preferred stock is likely to drop in price. Changes in interest rates can also
affect their price. (See "Investing in Bonds," below.)

[GRAPHIC OMITTED]
INVESTING IN CONVERTIBLE SECURITIES, PREFERRED STOCKS, AND BONDS. Since
preferred stocks and corporate bonds pay a stated return, their prices usually
don't depend on the price of the company's common stock. But some companies
issue preferred stocks and bonds that are CONVERTIBLE into their common stocks.
Linked to the common stock in this way, convertible securities go up and down
in price as the common stock does, adding to their market risk.

[GRAPHIC OMITTED]
VOLATILITY. The more an investment goes up and down in price, the more VOLATILE
it is. Volatility increases the market risk because even though your portfolio
may go UP more than the market in good times, it may also go

Prospectus 39
<PAGE>

EXPLANATION OF STRATEGIES AND RISKS (CONTINUED)

DOWN more than the market in bad times. If you decide to sell when a volatile
portfolio is down, you could lose more.

[GRAPHIC OMITTED]
INVESTING IN BONDS. Like common stocks, bonds fluctuate in value, though the
factors causing this fluctuation are different, including:

o CHANGES IN INTEREST RATES. Bond prices tend to move the opposite
of interest rates. Why? Because when interest rates on new bond issues go
up, rates on existing bonds stay the same and they become less desirable.
When rates go down, the reverse happens. This is also true for most
preferred stocks and some convertible securities.

o LENGTH OF TIME TO MATURITY. When a bond matures, the issuer must
pay the owner its face value. If the maturity date is a long way off, many
things can affect its value, so a bond is more volatile the farther it is
from maturity. As that date approaches, fluctuations usually become
smaller and the price gets closer to face value.

o DEFAULTS. All bond issuers make at least two promises: (1) to
pay interest during the bond's term and (2) to return principal when it
matures. If an issuer fails to keep one or both of these promises, the
bond will probably drop in price dramatically, and may even become
worthless. Changes in financial condition and general economic conditions
can affect the ability to honor financial obligations and therefore credit
quality. A security's price may be adversely affected by the market's
opinion of the security's credit quality level even if the issuer or
counterparty has suffered no degradation in ability to honor the
obligation.

o DECLINES IN RATINGS. At the time of issue, most bonds are rated
by professional rating services, such as Moody's Investors Service, Inc.
(Moody's) and Standard & Poor's Corporation (S&P). The stronger the
financial backing behind the bond, the higher the rating. If this backing
is weakened or lost, the rating service may downgrade the bond's rating.
This is virtually certain to cause the bond to drop in price. Bonds that
are rated below BBB by S&P, and below Ba by Moody's, are considered to be
below investment grade. Moody's rates bonds in nine categories, from Aaa
to C, with Aaa being the highest with least risk. S&P rates bonds in six
categories, from AAA to D, with AAA being the highest.

o LOW RATING. High-yield/high-risk fixed-income securities
(commonly known as "junk bonds") have greater credit risk, are more
sensitive to interest rate movements, are considered more speculative than
higher rated bonds, have a greater vulnerability to economic changes and
are less liquid. The market for such securities may be less active than
for higher rated securities, which can adversely affect the price at which
these securities may be sold and may diminish a portfolio's ability to
obtain accurate market quotations when valuing the portfolio securities
and calculating the portfolio's net asset value.

o LACK OF RATING. Some bonds are considered speculative, or for
other reasons are not rated. Such bonds must pay a higher interest rate in
order to attract investors. They're considered riskier because of the
higher possibility of default or loss of liquidity.

o LOSS OF LIQUIDITY. If a bond is downgraded, or for other reasons
drops in price, the market demand for it may "dry up". In that case, the
bond may be hard to sell or "liquidate" (convert to cash).

[GRAPHIC OMITTED]
INVESTING IN FOREIGN SECURITIES. These are investments offered by foreign
companies, governments and government agencies. They involve risks not usually
associated with U.S. securities, including:

o CHANGES IN CURRENCY VALUES. Foreign securities are sold in
currencies other than U.S. dollars. If a currency's value drops, the value
of the securities held by a portfolio could drop too, even if the
securities are strong. In turn, the value of the shares of the portfolio
could also drop. Dividend and interest payments may be lower. Factors
affecting exchange rates are: differing interest rates among countries;
balances of trade; amount of a country's overseas investments; and any
currency manipulation by banks.

o CURRENCY SPECULATION. The foreign currency market is largely
unregulated and subject to speculation.

o ADRS/ADSS. Some portfolios also invest in American Depositary
Receipts (ADRs) and American Depositary Shares (ADSs). They represent
securities

Prospectus 40
<PAGE>

EXPLANATION OF STRATEGIES AND RISKS (CONTINUED)

of foreign companies traded on U.S. exchanges, and their values are expressed
in U.S. dollars. Changes in the value of the underlying foreign currency will
change the value of the ADR or ADS. A portfolio incurs costs when it converts
other currencies into dollars, and vice-versa.

o EURO CONVERSION. On January 1, 1999, certain participating countries in the
European Economic Monetary Union adopted the "Euro" as their official
currency. Other EU member countries may convert to the Euro at a later date.
As of January 1, 1999, governments in participating countries issued new debt
and redenominated existing debt in Euros; corporations chose to issue stocks
or bonds in Euros or national currency. The new European Central Bank (the
"ECB") will assume responsibility for a uniform monetary policy in
participating countries. Euro conversion risks that could affect a
portfolio's foreign investments include: (1) the readiness of Euro payment,
clearing, and other operational systems; (2) the legal treatment of debt
instruments and financial contracts in existing national currencies rather
than the Euro; (3) exchange-rate fluctuations between the Euro and non-Euro
currencies during the transition period of January 1, 1999 through December
31, 2002 and beyond; (4) potential U.S. tax issues with respect to portfolio
securities; and (5) the ECB's abilities to manage monetary policies among the
participating countries; and (6) the ability of financial institution systems
to process Euro transactions.

o DIFFERENT ACCOUNTING AND REPORTING PRACTICES. Foreign tax laws are different,
as are laws, practices and standards for accounting, auditing and reporting
data to investors.

o LESS INFORMATION AVAILABLE TO THE PUBLIC. Foreign companies usually make less
information available to the public.

o LESS REGULATION. Securities regulations in many foreign countries are more
lax than in the U.S.

o MORE COMPLEX NEGOTIATIONS. Because of differing business and legal
procedures, a portfolio may find it hard to enforce obligations or negotiate
favorable brokerage commission rates.

o LESS LIQUIDITY/MORE VOLATILITY. Some foreign securities are harder to convert
to cash than U.S. securities, and their prices may fluctuate more
dramatically.

o SETTLEMENT DELAYS. "Settlement" is the process of completing a securities
transaction. In many countries, this process takes longer than it does in the
U.S.

o HIGHER CUSTODIAL CHARGES. Fees charged by the Fund's custodian for holding
shares are higher for foreign securities than that of domestic securities.

o HIGHER TRANSACTION COSTS. Fees charged by securities brokers are often higher
for transactions involving foreign securities than domestic securities.
Higher expenses, such as brokerage fees, may reduce the return a portfolio
might otherwise achieve.

o VULNERABILITY TO SEIZURE AND TAXES. Some governments can seize assets. They
may also limit movement of assets from the country. A portfolio's interest,
dividends and capital gains may be subject to foreign withholding taxes.

o POLITICAL INSTABILITY AND SMALL EMERGING MARKETS. Developing countries can be
politically unstable. Economies can be dominated by a few industries, and
markets may trade a small number of securities. Regulations of banks and
capital markets can be weak.

o DIFFERENT MARKET TRADING DAYS. Foreign markets may not be open for trading
when U.S. markets are and asset values can change before your transaction
occurs.

o HEDGING. A portfolio may, but will not necessarily, enter into forward
currency contracts to hedge against declines in the value of securities
denominated in, or whose value is tied to, a currency other than the U.S.
dollar or to reduce the impact of currency fluctuation on purchases, and
sales of such securities.

[GRAPHIC OMITTED]
INVESTING IN FUTURES, OPTIONS AND DERIVATIVES. Besides conventional securities,
your portfolio may seek to increase returns by investing in financial contracts
related to its primary investments. Such contracts involve additional risks and
costs. Risks include:

o INACCURATE MARKET PREDICTIONS. If the sub-adviser is wrong in its
expectation, for example, with respect to interest rates, securities prices
or currency markets, the contracts could produce losses instead of gains.

Prospectus 41
<PAGE>

EXPLANATION OF STRATEGIES AND RISKS (CONTINUED)

o PRICES MAY NOT MATCH. Movements in the price of the financial contracts may
be used to offset movements in the price of other securities you own. If
those prices don't correlate or match closely, the benefits of the
transaction might be diminished.

o ILLIQUID MARKETS. If there's no market for the contracts, the portfolio may
not be able to control losses.

o TAX CONSEQUENCES. Sometimes the possibility of incurring high taxes on a
transaction may delay closing out a position and limit the gains it would
have produced.

[GRAPHIC OMITTED]
INVESTING IN SPECIAL SITUATIONS. Each portfolio may invest in "special
situations" from time to time. Special situations arise when, in the opinion of
a portfolio manager, a company's securities may be undervalued, then increase
considerably in price, due to:

o A NEW PRODUCT OR PROCESS

o A MANAGEMENT CHANGE

o A TECHNOLOGICAL BREAKTHROUGH

o AN EXTRAORDINARY CORPORATE EVENT

o A TEMPORARY IMBALANCE IN THE SUPPLY OF, AND DEMAND FOR, THE
SECURITIES OF AN ISSUER

Investing in a special situation carries an additional risk of loss if the
expected development does not happen or does not attract the expected
attention. The impact of special situation investing to a portfolio will depend
on the size of a portfolio's investment in a situation.

[GRAPHIC OMITTED]
CASH POSITION
A portfolio may, at times, choose to hold some portion of its net assets in
cash, or to invest that cash in a variety of short-term debt securities that
are considered cash equivalents. This may be done as a temporary defensive
measure at times when desirable risk/reward characteristics are not available
in stocks or to earn income from otherwise uninvested cash. When a portfolio
increases its cash or debt investment position, its income may increase while
its ability to participate in stock market advances or declines decrease.

[GRAPHIC OMITTED]
PORTFOLIO TURNOVER
A portfolio turnover rate is, in general, the percentage calculated by taking
the lesser of purchases or sales of portfolio securities (excluding short-term
securities) for a year and dividing it by the monthly average of the market
value of such securities during the year.

Changes in security holdings are made by a portfolio's sub-adviser when it is
deemed necessary. Such changes may result from: liquidity needs; securities
having reached a price or yield objective; anticipated changes in interest
rates or the credit standing of an issuer; or unforeseen developments.

The rate of portfolio turnover will not be a limiting factor when short-term
investing is considered appropriate. Increased turnover rates result in higher
brokerage costs and other transaction based expenses for a portfolio. These
charges are ultimately borne by the policyholders.

[GRAPHIC OMITTED]
SHORT SALES
A portfolio may sell securities "short against the box." A short sale is the
sale of a security that the portfolio does not own. A short sale is "against
the box" if at all times when the short position is open, the portfolio owns an
equal amount of the securities convertible into, or exchangeable without
further consideration for, securities of the same issue as the securities sold
short.

[GRAPHIC OMITTED] INVESTMENT STRATEGIES

A portfolio is permitted to use other securities and investment strategies in
pursuit of its investment objective, subject to limits established by the
Fund's Board of Director. No portfolio is under any obligation to use any of
the techniques or strategies at any given time or under any particular economic
condition. Certain instruments and investment strategies may expose the
portfolios to other risks and considerations, which are discussed in the Fund's
SAI.

Prospectus 42
<PAGE>

HOW THE FUND IS MANAGED AND ORGANIZED

[GRAPHIC OMITTED]
HOW THE FUND IS MANAGED AND ORGANIZED
The Fund's Board is responsible for managing the business affairs of the Fund.
It oversees the operation of the Fund by its officers. It also reviews the
management of the portfolios' assets by the investment adviser and
sub-advisers. Information about the Directors and executive officers of the
Fund is contained in the SAI.

WRL Investment Management, Inc. (WRL Management) located at 570 Carillon
Parkway, St. Petersburg, Florida 33716, has served as the Fund's investment
adviser since 1997. (Prior to this date, Western Reserve served as investment
adviser to the Fund). The investment adviser is a direct, wholly-owned
subsidiary of Western Reserve Life Assurance Co. of Ohio (Western Reserve),
which is wholly-owned by First AUSA Life Insurance Company, a stock life
insurance company, which is wholly-owned by AEGON USA, Inc. AEGON USA, Inc. is
a financial services holding company whose primary emphasis is on life and
health insurance and annuity and investment products. AEGON USA, Inc. is a
wholly-owned indirect subsidiary of AEGON N.V., a Netherlands corporation which
is a publicly traded international insurance group. The investment adviser had
no prior experience as an adviser.

Subject to the supervision of the Fund's Board, the investment adviser is
responsible for furnishing continuous advice and recommendations to the Fund as
to the acquisition, holding or disposition of any or all of the securities or
other assets which the portfolios may own or contemplate acquiring from time to
time; to cause its officers to attend meetings and furnish oral or written
reports, as the Fund may reasonably require, in order to keep the Fund's Board
and appropriate officers of the Fund fully informed as to the conditions of the
investment portfolio of each portfolio, the investment recommendations of the
investment adviser, and the investment considerations which have given rise to
those recommendations; to supervise the purchase and sale of securities of the
portfolios as directed by the appropriate officers of the Fund; and to maintain
all books and records required to be maintained by the investment adviser.

The Fund has received an order from the Securities and Exchange Commission that
will permit the Fund and the investment adviser, subject to certain conditions,
and without the approval of shareholders to: (1) employ a new unaffiliated
sub-adviser for a portfolio pursuant to the terms of a new investment
sub-advisory agreement, either as a replacement for an existing sub-adviser or
as an additional sub-adviser; (2) materially change the terms of any
sub-advisory agreement; and (3) continue the employment of an existing
sub-adviser on the same sub-advisory contract terms where a contract has been
assigned because of a change in control of the sub-adviser. In such
circumstances, shareholders would receive notice and information about the new
sub-adviser within ninety (90) days after the hiring of any new sub-adviser.

As compensation for its services to the portfolios, the investment adviser
receives monthly compensation at an annual rate of a percentage of the average
daily net assets of each portfolio. The advisory fees for each portfolio are:

ADVISORY
PORTFOLIO FEE
WRL Janus Growth* 0.80%
WRL AEGON Bond 0.45%
WRL Janus Global** 0.80%
WRL J.P. Morgan Money
Market 0.40%
WRL AEGON Balanced 0.80%
WRL GE/Scottish
Equitable International
Equity 1.00%
WRL Third Avenue Value 0.80%
WRL VKAM Emerging
Growth 0.80%
WRL LKCM Strategic
Total Return 0.80%
WRL Alger Aggressive
Growth 0.80%
WRL Federated Growth
& Income 0.75%
WRL Dean Asset
Allocation 0.80%
WRL C.A.S.E. Growth 0.80%
WRL NWQ Value Equity 0.80%
WRL GE U.S. Equity 0.80%
WRL J.P. Morgan Real
Estate Securities 0.80%

* WRL Management currently waives 0.025% of its advisory fee for the first $3
billion of the portfolio's average daily net assets (net fee -- 0.775%); and
0.05% of assets above $3 billion (net fee -- 0.75%). This waiver is voluntary
and may be terminated at any time.

** WRL Management currently waives 0.025% of its advisory fee for the
portfolio's average daily net assets above $2 billion (net fee -- 0.775%.) This
waiver is voluntary and may be terminated at any time.

Prospectus 43
<PAGE>

HOW THE FUND IS MANAGED AND ORGANIZED (CONTINUED)

ADVISORY
PORTFOLIO FEE
WRL Salomon All Cap 0.90% up to $100 million
0.80% over $100 million
WRL T. Rowe Price 0.90% up to $100 million
Dividend Growth 0.80% over $100 million
WRL T. Rowe Price
Small Cap 0.75%
WRL Dreyfus Mid Cap 0.85% up to $100 million
0.80% over $100 million
WRL Pilgrim Baxter 0.90% up to $100 million
Mid Cap Growth 0.80% over $100 million
WRL Goldman Sachs
Small Cap 0.90%
WRL Goldman Sachs 0.90% up to $100 million
Growth 0.80% over $100 million

Here is a listing of the sub-advisers and the portfolios they manage:

SUB-ADVISER PORTFOLIO
Alger WRL Alger Aggressive Growth
SEIM WRL GE/Scottish Equitable
International Equity
GEIM WRL GE/Scottish Equitable
International Equity
WRL GE U.S. Equity
Janus WRL Janus Global
WRL Janus Growth
C.A.S.E. WRL C.A.S.E. Growth
NWQ WRL NWQ Value Equity
Dean WRL Dean Asset Allocation
AIMI WRL AEGON Bond
WRL AEGON Balanced
T. Rowe Price WRL T. Rowe Price
Dividend Growth
WRL T. Rowe Price Small Cap
SBAM WRL Salomon All Cap
GSAM WRL Goldman Sachs Growth
WRL Goldman Sachs Small Cap
Pilgrim Baxter WRL Pilgrim Baxter
Mid Cap Growth
VKAM WRL VKAM Emerging Growth
EQSF WRL Third Avenue Value
LKCM WRL LKCM Strategic
Total Return
J.P. Morgan WRL J.P. Morgan Real
Estate Securities
WRL J.P. Morgan
Money Market
Federated WRL Federated Growth
& Income
Dreyfus WRL Dreyfus Mid Cap

DAY-TO-DAY MANAGEMENT OF THE INVESTMENTS IN EACH PORTFOLIO IS THE
RESPONSIBILITY OF THE PORTFOLIO MANAGER. THE PORTFOLIO MANAGERS OF THE FUND
ARE:

WRL VKAM EMERGING GROWTH
GARY M. LEWIS is primarily responsible for the day to day management of this
portfolio. Mr. Lewis has been senior vice president of VKAM since October,
1995. Previously, he has served as vice president/portfolio manager of VKAM
from 1989 to October 1995.

WRL T. ROWE PRICE SMALL CAP
RICHARD T. WHITNEY, CFA has managed this portfolio since inception and heads
the Investment Team for this portfolio. He joined T. Rowe Price in 1985.

WRL GOLDMAN SACHS SMALL CAP
ROBERT C. JONES, MANAGING DIRECTOR, has served as the head of an investment
team that has managed the portfolio since its inception. Mr. Jones joined GSAM
as a portfolio manager in 1989.

WRL PILGRIM BAXTER MID CAP GROWTH
JEFFREY A. WRONA, CFA has managed this portfolio since inception. Prior to
joining Pilgrim Baxter, he was a senior portfolio manager at Munder Capital
Management.

WRL ALGER AGGRESSIVE GROWTH
DAVID D. ALGER has been employed by Alger since 1971 and has served as
president since 1995. He has managed this portfolio since inception.

DAVID HYUN has served as co-manager of this portfolio since February 1998. He
has been employed by Alger as a senior research analyst since 1991 and a
portfolio manager since 1997.

WRL THIRD AVENUE VALUE
MARTIN J. WHITMAN has served as portfolio manager of this portfolio since its
inception. He is Chairman, President and Chief Executive Officer of the sub-

Prospectus 44
<PAGE>

HOW THE FUND IS MANAGED AND ORGANIZED (CONTINUED)

WRL GE/SCOTTISH EQUITABLE INTERNATIONAL EQUITY
At SEIM, investment strategy is formulated by the Investment Strategy Group.
RUSSELL HOGAN leads the investment strategy team. Mr. Hogan is the Investment
Director of Scottish Equitable PLC, parent company of SEIM. He oversees all
aspects of asset management. He has been with SEIM for 14 years and has been
the team leader since the portfolio's inception.

At GEIM, RALPH R. LAYMAN leads a team of portfolio managers. He has served in
that capacity since the portfolio's inception. Mr. Layman joined GEIM in 1991
as an executive vice president for international investments.

WRL JANUS GLOBAL
HELEN YOUNG HAYES has been employed by Janus since 1987 and has managed this
portfolio since its inception.

WRL SALOMON ALL CAP
ROSS S. MARGOLIES has managed this portfolio since inception. Mr. Margolies
joined Salomon in 1992.

ROBERT M. DONAHUE, JR. assists in the day-to-day management of the portfolio.
Prior to joining SBAM in 1997, Mr. Donahue worked as an equity analyst at
Gabelli & Company.

WRL JANUS GROWTH
SCOTT W. SCHOELZEL and EDWARD KEELY serve as co-managers of this portfolio. Mr.
Schoelzel has managed this portfolio since January 1996. Before that, he was
co-manager of this portfolio since 1995. He has been employed by Janus since
1994.

Mr. Keely has managed the portfolio since January 1999. He has been employed by
Janus since 1998. Prior to joining Janus, he was a senior vice president of
investments at Founders.

WRL GOLDMAN SACHS GROWTH
HERBERT E. EHLERS has served as head of a six person investment team that has
managed the portfolio since inception. Prior to joining GSAM in 1997, he was
chief investment officer at Liberty Investment Management, Inc. from 1994-1997.

WRL C.A.S.E GROWTH
This portfolio is managed by a team of professionals, called the Portfolio
Management Committee. WILLIAM E. LANGE is the head manager of this Committee.
He has been president of C.A.S.E. since 1984.

WRL GE U.S. EQUITY
EUGENE K. BOLTON leads a team of portfolio managers for this portfolio. He has
served in that capacity since the portfolio's inception. Mr. Bolton joined GEIM
in 1984 as Chief Financial Officer and has been a portfolio manager since 1986.

WRL DREYFUS MID CAP
JOHN O'TOOLE has served as portfolio manager since inception and has been
employed by Dreyfus as portfolio manager since 1994. Mr. O'Toole is a senior
vice president and portfolio manager for Mellon Equity Associates. He has been
employed by Mellon Bank since 1979.

WRL NWQ VALUE EQUITY
EDWARD C. FRIEDEL has been the senior manager of this portfolio since
inception. He has been a managing director and investment strategist with NWQ
since 1983.

WRL T. ROWE PRICE
DIVIDEND GROWTH
WILLIAM J. STROMBERG, CFA has managed this portfolio since inception and heads
the Investment Team for this Portfolio. He joined T. Rowe Price in 1986.

WRL DEAN ASSET ALLOCATION
JOHN C. RIAZZI, CFA and ARVIND SACHDEVA, CFA have served as co-portfolio
managers since the portfolio's inception.

Mr. Riazzi is the senior manager of this portfolio. He joined Dean in 1989.

Mr. Arvind Sachdeva is the senior equity strategist of this portfolio. He
joined Dean in 1993.

Prospectus 45
<PAGE>

HOW THE FUND IS MANAGED AND ORGANIZED (CONTINUED)

WRL LKCM STRATEGIC TOTAL RETURN
LUTHER KING, JR., CFA and SCOT C. HOLLMANN, CFA have co-managed this portfolio
since inception.

Mr. King has been the president of Luther King since 1979.

Mr. Hollmann has been a vice president of Luther King since 1983.

WRL J.P. MORGAN REAL ESTATE SECURITIES
DANIEL P. O'CONNOR serves as portfolio manager of this portfolio. Mr. O'Conner
has been a portfolio manager since the porfolio's inception. Prior to joining
J.P. Morgan in 1996, Mr. O'Conner served two years as Director of Real Estate
Securities at INVESCO.

WRL FEDERATED GROWTH & INCOME
STEVEN J. LEHMAN, CFA and LINDA A. DUESSEL, CFA serve as co-portfolio managers
of this portfolio.

Mr. Lehman has served as co-portfolio manager since 1997. He joined Federated
in 1997. From 1985 to 1997, he served as portfolio manager, vice president and
senior portfolio manager at First Chicago NBD.

Ms. Duessel has been employed by Federated since 1991 and has been a portfolio
manager of this portfolio since 1996.

WRL AEGON BALANCED
MICHAEL VAN METER has served as the senior portfolio manager of this portfolio
since inception. Mr. Van Meter has been employed by VMF Capital, LLC (VMF)
since July, 1998. Prior to joining VMF, Mr. Van Meter was employed by AIMI.

WRL AEGON BOND
CLIFFORD A. SHEETS, CFA and JARRELL D. FREY, CFA serve as co-portfolio managers
of this portfolio. Mr. Sheets and Mr. Frey has served as co-portfolio managers
since 1998. Mr. Sheets joined AIMI in 1990 and Mr. Frey joined in 1994.

WRL J.P. MORGAN MONEY MARKET
ROBERT R. JOHNSON serves as portfolio manager of this portfolio. He has been
employed by J.P. Morgan since 1988.

Prospectus 46
<PAGE>

PERFORMANCE INFORMATION

The Fund may include quotations of a portfolio's total return or yield in
connection with the total return for the appropriate separate account, in
advertisements, sales literature or reports to policyowners or to prospective
investors. Total return and yield quotations for a portfolio reflect only the
performance of a hypothetical investment in the portfolio during the particular
time period shown as calculated based on the historical performance of the
portfolio during that period. SUCH QUOTATIONS DO NOT IN ANY WAY INDICATE OR
PROJECT FUTURE PERFORMANCE. Quotations of total return and yield will not
reflect charges or deductions against the separate accounts or charges and
deductions against the policies or the annuity contracts. Where relevant, the
prospectuses for the policies and the annuity contracts contain performance
information which show total return and yield information for the separate
accounts, policies or annuity contracts.

YIELD
Yield quotations for the WRL AEGON Bond portfolio refer to the income generated
by a hypothetical investment in the portfolio over a specified thirty-day
period expressed as a percentage rate of return for that period. The yield is
calculated by dividing the net investment income per share for the period by
the price per share on the last day of that period.

TOTAL RETURN
Total return refers to the average annual percentage change in value of an
investment in a portfolio held for a stated period of time as of a stated
ending date. When a portfolio has been in operation for the stated period, the
total return for such period will be provided if performance information is
quoted. Total return quotations are expressed as average annual compound rates
of return for each of the periods quoted. They also reflect the deduction of a
proportionate share of a portfolio's investment advisory fees and direct
portfolio expenses, and assume that all dividends and capital gains
distributions during the period are reinvested in the portfolio when made.

SIMILAR SUB-ADVISER PERFORMANCE
A portfolio may disclose in advertisements, supplemental sales literature, and
reports to policyowners or to prospective investors total returns of an
EXISTING SEC-REGISTERED fund that is managed by the portfolio's sub-adviser and
that has investment objectives, policies, and strategies substantially similar
to those of such portfolio (a "Similar Sub-Adviser Fund"). ALTHOUGH THE SIMILAR
SUB-ADVISER FUNDS HAVE SUBSTANTIALLY SIMILAR INVESTMENT OBJECTIVES, POLICIES,
AND STRATEGIES AS THE DESIGNATED PORTFOLIO, AND ARE MANAGED BY THE SAME
SUB-ADVISER AS THE DESIGNATED PORTFOLIO, YOU SHOULD NOT ASSUME THAT ANY
PORTFOLIO WILL HAVE THE SAME FUTURE PERFORMANCE AS SIMILAR SUB-ADVISER FUNDS
WHOSE TOTAL RETURNS ARE SHOWN. Each portfolio's future performance may be
greater or less than the historical performance of the corresponding Similar
Sub-Adviser Fund. There can be no assurance, and no representation is made,
that the investment results of any portfolio will be comparable to the results
of any of the Similar Sub-Adviser Funds or any other fund managed by WRL
Management or any sub-adviser.

The table below sets forth certain portfolios of the Fund and, for each
portfolio's respective Similar Sub-Adviser Fund, the fund's inception date,
asset size, and the average annual total returns for the one, five and ten year
periods (or life of the Similar Sub-Adviser Fund, if shorter) ended December
31, 1998. These figures are based on the actual investment performance of the
Similar Sub-Adviser Funds. Each Similar
Sub-Adviser Fund has higher total expenses than its corresponding portfolio of
the Fund. The average annual total returns for the Similar Sub-Adviser Funds
are shown with and without the deductions of any applicable sales load. YOU
SHOULD NOTE THAT THE PERFORMANCE OF THE SIMILAR SUB-ADVISER FUNDS DOES NOT
REFLECT THE HISTORICAL PERFORMANCE OF ANY PORTFOLIOS.

Prospectus 47
<PAGE>

PERFORMANCE INFORMATION (CONTINUED)

SIMILAR SUB-ADVISER FUND PERFORMANCE

AVERAGE ANNUAL TOTAL RETURN
(WITH SALES LOADS)
-------------------------------
SIMILAR 10 YEARS
SUB-ADVISER INCEPTION TOTAL OR SINCE
WRL PORTFOLIO FUND DATE ASSETS 1 YEAR 5 YEARS INCEPTION
- ----------------------------- ----------------------------- ----------- ---------------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
WRL Janus Global Janus Worldwide(1) 5/15/91 $18.5 15.44% 21.13% 21.29%
billion
WRL Alger Aggressive Growth The Alger Fund Class A $349.3 31.85% N/A 26.38%
Capital Appreciation 12/31/96 million
Class A Shares(2) (Net) (all classes)
WRL VKAM Emerging Growth Van Kampen Class A $5,196.5 26.98% 19.53% 17.85%
Emerging Growth(3) 10/2/70 million
WRL Third Avenue Value Third Avenue 11/1/90 $1.6 3.92% 13.93% 20.08%
Value Fund(4) billion
WRL Dreyfus Mid Cap Dreyfus Premier Midcap Class A $186.6 2.40% N/A 18.92%
Stock Fund(9) 4/6/94 million
(all classes)
WRL Goldman Sachs Growth Goldman Sachs Capital Class A $2,187.8 26.53% 20.89% 18.99%
Growth Fund(6) 4/20/90 million
(all classes)
WRL Goldman Sachs Small Cap Goldman Sachs CORE Class A $145.6 -11.17% N/A -2.93%
Small Cap Equity Fund(7) 8/15/97 million
(all classes)
WRL T. Rowe Price T. Rowe Price Dividend 12/30/92 $1.3 15.04% 20.48% 20.29%
Dividend Growth Growth Fund(1) billion

WRL T. Rowe Price Small Cap T. Rowe Price Diversified 6/30/97 $7.9 3.58% N/A 7.14%
Small-Cap Growth Fund(1) million
WRL Pilgrim Baxter PBHG Growth II Portfolio(5) 5/1/97 $19 million 8.19% N/A 9.46%
Mid Cap Growth
WRL Salomon All Cap Salomon Brothers Class O $240.9 23.83% 19.37% 17.56%
Capital Fund(8) 11/1/96 million
(all classes)
</TABLE>

(1) The Janus Worldwide Fund and T. Rowe Price Dividend Growth and T. Rowe
Price Diversified Small Cap Growth Funds do not have sales loads.
(2) Total returns are for Class A shares of The Alger Fund Capital Appreciation
Portfolio and reflect a deduction of a 4.75% front-end sales load. The
Portfolio also offers Class B and Class C shares with different sales
loads. Calculating total return with those sales loads may have resulted
in lower total returns. The inception dates for Class A, B and C shares
are 12/31/96, 10/29/93 and 8/1/97, respectively.
(3) Total returns are for Class A shares of the Van Kampen Emerging Growth Fund
and reflect a deduction of a 5.75% front end sales load. The fund also has
Class B and Class C shares with different sales loads. Calculating total
return with those sales loads may have resulted in lower total returns.
(4) 5 year total return for the Third Avenue Value Fund reflects a sales load
of 5.75% in effect during the fifth year.
(5) The PBHG Growth II Portfolio does not have a sales load. The Portfolio
commenced operations on May 1, 1997.
(6) Total returns are for Class A shares of the Goldman Sachs Capital Growth
Fund and reflects a deduction of a 5.5% front-end sales load. The Fund also
offers Class B and Class C shares with different sales loads. Calculating
total return with those sales loads may have resulted in lower total
returns.
(7) Total returns are for Class A shares of the Goldman Sachs CORE Small Cap
Equity Fund and reflects a deduction of a 5.5% front-end sales load. The
fund also offers Class B and Class C shares with different sales loads.
Calculating total returns with those sales loads may have resulted in lower
total returns.
(8) Total returns are for Class O shares of the Salomon Brothers Capital Fund.
Class O shares are sold without any sales charge to the fund. The fund
also offers Class A, Class B and Class 2 shares.
(9) Total returns are for Class A of the Dreyfus Premier Mid Cap Stock Fund and
respect the deduction of a 5.75% front-end sales load. The Fund also
offers Class B and Class C shares with different sales loads. Calculating
total returns with those sales loads may have resulted in lower total
returns.

Prospectus 48
<PAGE>

PERFORMANCE INFORMATION (CONTINUED)

SIMILAR SUB-ADVISER FUND PERFORMANCE

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
(WITHOUT SALES LOADS)
-------------------------------
SIMILAR 10 YEARS
SUB-ADVISER INCEPTION TOTAL OR SINCE
WRL PORTFOLIO FUND DATE ASSETS 1 YEAR 5 YEARS INCEPTION
- ----------------------------- --------------------------- ----------- ---------------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>

WRL Janus Global Janus Worldwide(1) 5/15/91 $18.5 15.44% 21.13% 21.29%
billion
WRL Alger Aggressive Growth The Alger Fund(1) Class A $349.3 38.42% N/A 29.49%
Capital Appreciation 12/31/96 million
WRL VKAM Emerging Growth Van Kampen Class A $5,196.5 34.73% 20.96% 18.08%
Emerging Growth 10/2/70 million
WRL Third Avenue Value Third Avenue 11/1/90 $1.6 3.92% 15.28% 20.08%
Value Fund billion
WRL Dreyfus Mid Cap Dreyfus Premier Midcap Class R $186.6 8.63% N/A 20.41%
Stock Fund 11/12/93 million
(all classes)
WRL Goldman Sachs Growth Goldman Sachs Capital Class A $2,187.8 33.88% 22.27% 19.76%
Growth Fund(1) 4/20/90 million
(all classes)
WRL Goldman Sachs Small Cap Goldman Sachs CORE Class A $145.6 -5.96% N/A 1.11%
Small Cap Equity Fund(1) 8/15/97 million
(all classes)
WRL T. Rowe Price Dividend T. Rowe Price Dividend 12/30/92 $1.3 15.04% 20.48% 20.29%
Growth Growth Fund(2) billion
WRL T. Rowe Price Small Cap T. Rowe Price Diversified 6/30/97 $7.9 3.58% N/A 7.14%
Small-Cap Growth Fund(2) million
WRL Pilgrim Baxter Mid Cap PBHG Growth II Portfolio 5/1/97 $18 million 8.19% N/A 9.46%
Growth
WRL Salomon All Cap Salomon Brothers Class O $240.9 23.83% 19.37% 17.56%
Capital Fund(3) 11/1/96 million
(all classes)
</TABLE>

(1) The fund offers Class B and Class C shares as well. Returns for those
classes may differ from those of Class A shares due to differing fee
structures.
(2) The T. Rowe Price Dividend Growth and T. Rowe Price Diversified Small-Cap
Growth Funds do not have a sales loads.
(3) The Salomon Brothers Capital Fund Class O shares does not have a sales
load.

THE PERFORMANCE OF SIMILAR SUB-ADVISER FUNDS DOES NOT REFLECT ANY OF THE
CHARGES, FEES, AND EXPENSES IMPOSED UNDER THE POLICIES OR ANNUITY CONTRACTS.
SUCH PERFORMANCE WOULD IN EACH CASE BE LOWER IF IT REFLECTED THESE CHARGES,
FEES AND EXPENSES. SEE THE CONTRACT FORM OR DISCLOSURE DOCUMENT FOR THE POLICY
OR ANNUITY CONTRACT. (THE DISCLOSURE DOCUMENTS FOR THE POLICY OR ANNUITY
CONTRACT DESCRIBE SIMILAR SUB-ADVISERS FUNDS AS "SIMILAR SUB-ADVISED FUNDS.")

(See the SAI for more information about the portfolios' performance.)

Prospectus 49
<PAGE>

OTHER INFORMATION

[GRAPHIC OMITTED] PURCHASE AND REDEMPTION OF SHARES

As described earlier in the prospectus, shares of the portfolios are sold
exclusively to certain separate accounts of Western Reserve Life Assurance Co.
of Ohio, PFL Life Insurance Company, AUSA Life Insurance Company, Inc. and
Peoples Benefit Life Insurance Company and are not offered to the public.
Shares are sold and redeemed at their net asset value without the imposition of
any sales commission or redemption charge. (However, certain sales or other
charges may apply to the policies or annuity contracts, as described in the
product prospectus.)

[GRAPHIC OMITTED] VALUATION OF SHARES

Each portfolio's net asset value per share is ordinarily determined once daily,
as of the close of the regular session of business on the New York Stock
Exchange (NYSE) (usually 4:00 p.m., Eastern Time), on each day the exchange is
open.

Net asset value (NAV) of a portfolio share is computed by dividing the value of
the net assets of the portfolio by the total number of shares outstanding in
the portfolio. Share prices for any transaction are those next calculated after
receipt of an order.

WHAT IS NET ASSET VALUE?
The net asset value of a portfolio share is computed by dividing the value
of the net assets of the portfolio by the total number of shares
outstanding in the portfolio.

Except for money market instruments maturing in 60 days or less, securities
held by portfolios (other than the WRL J.P. Morgan Money Market) are valued at
market value. If market values are not readily available, securities are valued
at fair value as determined by the Fund's Valuation Committee under the
supervision of the Fund's Board.

Money market instruments maturing in 60 days or less, and all securities held
in the WRL J.P. Morgan Money Market, are valued on the amortized cost basis.
Under this method, the NAV of the money market portfolio shares is expected to
remain at a constant $1.00 per share, although there can be no assurance that
the portfolio will be able to maintain a stable NAV. (See the SAI for details.)

[GRAPHIC OMITTED] DIVIDENDS AND DISTRIBUTIONS

Each portfolio intends to distribute substantially all of its net investment
income, if any. Dividends from investment income of a portfolio normally are
declared daily and reinvested monthly in additional shares of the portfolio at
net asset value. Distributions of net realized capital gains from security
transactions normally are declared and paid in additional shares of the
portfolio at the end of the fiscal year.

[GRAPHIC OMITTED] TAXES

Each portfolio has either qualified and expects to continue to qualify or will
qualify in its initial year as a regulated investment company under Subchapter
M of the Internal Revenue Code of 1986, as amended ("Code"). As qualified, a
portfolio is not subject to federal income tax on that part of its taxable
income that it distributes to you. Taxable income consists generally of net
investment income, and any capital gains. It is each portfolio's intention to
distribute all such income and gains.

Shares of each portfolio are offered only to the separate accounts of Western
Reserve and its affiliates. Separate accounts are insurance company separate
accounts that fund the policies and the annuity contracts. Under the Code, an
insurance company pays no tax with respect to income of a qualifying separate
account when the income is properly allocable to the value of eligible variable
annuity or variable life insurance contracts. For a discussion of the taxation
of life insurance companies and the separate accounts, as well as the tax
treatment of the policies and annuity contracts and the holders thereof, see
"Federal Income Tax Considerations" included in the respective prospectuses for
the policies and the annuity contracts.

Section 817(h) of the Code and the regulations thereunder impose
"diversification" requirements on each portfolio. Each portfolio intends to
comply with the diversification requirements. These requirements are in
addition to the diversification requirements imposed on each portfolio by
Subchapter M and the

Prospectus 50
<PAGE>

OTHER INFORMATION (CONTINUED)

1940 Act. The 817(h) requirements place certain limitations on the assets of
each separate account that may be invested in securities of a single issuer.
Specifically, the regulations provide that, except as permitted by "safe
harbor," rules described below, as of the end of each calendar quarter or
within 30 days thereafter, no more than 55% of the portfolio's total assets may
be represented by any one investment, no more than 70% by any two investments,
no more than 80% by any three investments, and no more than 90% by any four
investments.

Section 817(h) also provides, as a safe harbor, that a separate account will be
treated as being adequately diversified if the diversification requirements
under Subchapter M are satisfied and no more than 55% of the value of the
account's total assets are cash and cash items, government securities, and
securities of other regulated investment companies. For purposes of section
817(h), all securities of the same issuer, all interests in the same real
property, and all interests in the same commodity are treated as a single
investment. In addition, each U.S. government agency or instrumentality is
treated as a separate issuer, while the securities of a particular foreign
government and its agencies, instrumentalities, and political subdivisions all
will be considered securities issued by the same issuer. If a portfolio does
not satisfy the section 817(h) requirements, the separate accounts, the
insurance companies, the policies and the annuity contracts may be taxable. See
the prospectuses for the policies and annuity contracts.

The foregoing is only a summary of some of the important federal income tax
considerations generally affecting a portfolio and you; see the SAI for a more
detailed discussion. You are urged to consult your tax advisors.

[GRAPHIC OMITTED] REPORT TO POLICYHOLDERS

The fiscal year of each portfolio ends on December 31 of each year. The Fund
will send to you, at least semi-annually, reports which show the portfolios'
composition and other information. An annual report, with audited financial
information, will be sent to you each year.

[GRAPHIC OMITTED] DISTRIBUTION AND SERVICE PLANS

The Fund has adopted a plan pursuant to Rule 12b-1 under the 1940 Act (the
"Plan") and pursuant to the Plan, entered into a Distribution Agreement with
AFSG Securities Corporation (AFSG) located at 4333 Edgewood Road NE, Cedar
Rapids, Iowa 52499. AFSG is an affiliate of the investment adviser, and serves
as principal underwriter for the Fund. (Prior to May 1, 1999, InterSecurities,
Inc., an affiliate of the investment adviser, served as underwriter of the
Fund.) The Plan permits the use of Fund assets to help finance the distribution
of the shares of the portfolios. Under the Plan, the Fund, on behalf of the
portfolios, is permitted to pay to various service providers up to 0.15% of the
average daily net assets of each portfolio as payment for actual expenses
incurred in connection with the distribution of the shares of the portfolios.
Because these fees are paid out of Fund assets on an on-going basis, over time
these costs will increase the cost of your investment and may cost you more
than other types of sales charges.

As of the date of this prospectus, the Fund has not paid any distribution fees
under the Plan and does not intend to do so before April 30, 2000. You will
receive written notice prior to the payment of any fees under the Plan.

[GRAPHIC OMITTED] YEAR 2000 READINESS

In May 1996, the Fund and the investment adviser adopted and presently have in
place a Year 2000 Project Plan (the "Plan") to review and analyze existing
hardware and software systems, as well as voice and data communications
systems, to determine if they are Year 2000 compliant. As of March 1, 1999,
substantially all of the Fund's and investment adviser's mission-critical
systems are Year 2000 compliant. The Plan remains on track as we continue with
the validation of our mission-critical and non-mission-critical systems,
including revalidation testing in 1999. In addition, we have undertaken
aggressive initiatives to test all systems that interface with any third
parties and other business partners. All of these steps are aimed at allowing
current operations to remain unaffected by the Year 2000 date change.

Prospectus 51
<PAGE>

OTHER INFORMATION (CONTINUED)

As of the date of this prospectus, the Fund and the investment adviser have
identified and made available what they believe are the appropriate resources
of hardware, people, and dollars, including the engagement of outside third
parties, to ensure that the Plan will be completed.

The actions taken by management under the Plan are intended to reduce
significantly the Fund's and the investment adviser's risk of a material
business interruption based on the Year 2000 issues. It should be noted that
the Year 2000 computer problem, and its resolution, is complex and
multifaceted, and any company's success cannot be conclusively known until the
Year 2000 is reached. In spite of its efforts or results, our ability to
function unaffected to and through the Year 2000 may be adversely affected by
actions, or failure to act, of third parties beyond our knowledge or control.

This statement is a Year 2000 Readiness Disclosure pursuant to Section 3(9) of
the YEAR 2000 INFORMATION AND READINESS DISCLOSURE ACT, 15 U.S.C. Section 1
(1998).

Prospectus 52
<PAGE>

FINANCIAL HIGHLIGHTS*

THE FINANCIAL HIGHLIGHTS TABLE IS INTENDED TO HELP YOU UNDERSTAND A PORTFOLIO'S
FINANCIAL PERFORMANCE FOR THE PAST 5 YEARS (OR, IF SHORTER, THE PERIOD OF THE
PORTFOLIO'S OPERATIONS). CERTAIN INFORMATION REFLECTS FINANCIAL RESULTS FOR A
SINGLE PORTFOLIO SHARE. THE TOTAL RETURNS IN THE TABLE REPRESENT THE RATE AN
INVESTOR WOULD HAVE EARNED (OR LOST) ON AN INVESTMENT IN EACH PORTFOLIO
(ASSUMING REINVESTMENT OF ALL DISTRIBUTIONS). THIS INFORMATION HAS BEEN AUDITED
BY PRICEWATERHOUSECOOPERS LLP, INDEPENDENT ACCOUNTANTS, WHOSE REPORT, ALONG
WITH THE FUND'S FINANCIAL STATEMENTS, ARE INCLUDED IN THE FUND'S ANNUAL REPORT,
WHICH IS AVAILABLE UPON REQUEST BY CALLING THE FUND AT 1-800-851-9777.
(INFORMATION IS NOT INCLUDED FOR WRL GOLDMAN SACHS SMALL CAP, WRL GOLDMAN SACHS
GROWTH, WRL PILGRIM BAXTER MID CAP GROWTH, WRL T. ROWE PRICE SMALL CAP, WRL T.
ROWE PRICE DIVIDEND GROWTH, WRL SALOMON ALL CAP OR WRL DREYFUS MID CAP AS THESE
PORTFOLIOS COMMENCED OPERATIONS MAY 1, 1999.)

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL J.P. MORGAN MONEY MARKET
-----------------------------
DECEMBER 31,
-----------------------------
1998 1997
-------------- --------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 1.00 $ 1.00
Income from operations:
Net investment income (loss) ........................................ 0.05 0.05
Net realized and unrealized gain (loss) on investments .............. 0.00 0.00
-------- --------
Net income (loss) from operations .................................. 0.05 0.05
-------- --------
Distributions:
Dividends from net investment income ................................ (0.05) (0.05)
Dividends in excess of net investment income ........................ 0.00 0.00
Distributions from net realized gains on investments ................ 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00
-------- --------
Total distributions ................................................ (0.05) (0.05)
-------- --------
Net asset value, end of year .......................................... $ 1.00 $ 1.00
======== ========
Total return (a) ...................................................... 5.26 % 5.24 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 169,731 $ 119,708
Ratio of expenses to average net assets (b) ......................... 0.46 % 0.48 %
Ratio of net investment income (loss) to average net assets (b) ..... 5.24 % 5.32 %
Portfolio turnover rate (a) ......................................... n/a n/a

<CAPTION>
WRL J.P. MORGAN MONEY MARKET
------------------------------------------
DECEMBER 31,
------------------------------------------
1996 1995 1994
-------------- ------------- -------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 1.00 $ 1.00 $ 1.00
Income from operations:
Net investment income (loss) ........................................ 0.05 0.05 0.04
Net realized and unrealized gain (loss) on investments .............. 0.00 0.00 0.00
-------- ------- -------
Net income (loss) from operations .................................. 0.05 0.05 0.04
-------- ------- -------
Distributions:
Dividends from net investment income ................................ (0.05) (0.05) (0.04)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ 0.00 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
-------- ------- -------
Total distributions ................................................ (0.05) (0.05) (0.04)
-------- ------- -------
Net asset value, end of year .......................................... $ 1.00 $ 1.00 $ 1.00
======== ======= =======
Total return (a) ...................................................... 5.03 % 5.40 % 3.44 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 122,114 $ 80,544 $ 93,081
Ratio of expenses to average net assets (b) ......................... 0.52 % 0.56 % 0.60 %
Ratio of net investment income (loss) to average net assets (b) ..... 5.03 % 5.30 % 3.59 %
Portfolio turnover rate (a) ......................................... n/a n/a n/a
</TABLE>

<TABLE>
<CAPTION>
WRL AEGON BOND
-----------------------------
DECEMBER 31,
-----------------------------
1998 1997
-------------- --------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 11.14 $ 10.71
Income from operations:
Net investment income (loss) ........................................ 0.64 0.65
Net realized and unrealized gain (loss) on investments .............. 0.40 0.32
-------- --------
Net income (loss) from operations .................................. 1.04 0.97
-------- --------
Distributions:
Dividends from net investment income ................................ (0.59) (0.54)
Dividends in excess of net investment income ........................ 0.00 0.00
Distributions from net realized gains on investments ................ 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00
-------- --------
Total distributions ................................................ (0.59) (0.54)
-------- --------
Net asset value, end of year .......................................... $ 11.59 $ 11.14
======== ========
Total return (a) ...................................................... 9.32 % 9.16 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 170,744 $ 129,654
Ratio of expenses to average net assets (b) ......................... 0.54 % 0.64 %
Ratio of net investment income (loss) to average net assets (b) ..... 5.54 % 5.90 %
Portfolio turnover rate (a) ......................................... 51.60 % 213.03 %

<CAPTION>
WRL AEGON BOND
----------------------------------------
DECEMBER 31,
----------------------------------------
1996 1995 1994
------------- ------------- ------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 11.35 $ 9.80 $ 11.24
Income from operations:
Net investment income (loss) ........................................ 0.64 0.69 0.63
Net realized and unrealized gain (loss) on investments .............. (0.64) 1.55 (1.44)
-------- -------- --------
Net income (loss) from operations .................................. 0.00 2.24 (0.81)
-------- -------- --------
Distributions:
Dividends from net investment income ................................ (0.64) (0.69) (0.63)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ 0.00 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
-------- -------- --------
Total distributions ................................................ (0.64) (0.69) (0.63)
-------- -------- --------
Net asset value, end of year .......................................... $ 10.71 $ 11.35 $ 9.80
======== ======== ========
Total return (a) ...................................................... 0.14 % 22.99 % (6.94)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 95,759 $ 96,972 $ 71,064
Ratio of expenses to average net assets (b) ......................... 0.64 % 0.61 % 0.59 %
Ratio of net investment income (loss) to average net assets (b) ..... 5.96 % 6.45 % 5.94 %
Portfolio turnover rate (a) ......................................... 187.72 % 120.54 % 131.73 %
</TABLE>

Prospectus 53
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL JANUS GROWTH
---------------------------------
DECEMBER 31,
---------------------------------
1998 1997
---------------- ----------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 36.84 $ 35.00
Income from operations:
Net investment income (loss) ........................................ 0.12 0.31
Net realized and unrealized gain (loss) on investments .............. 23.49 5.88
---------- ----------
Net income (loss) from operations .................................. 23.61 6.19
---------- ----------
Distributions:
Dividends from net investment income ................................ (0.09) (0.26)
Dividends in excess of net investment income ........................ 0.00 0.00
Distributions from net realized gains on investments ................ (0.42) (4.09)
Distributions in excess of net realized gains on investments ........ 0.00 0.00
---------- ----------
Total distributions ................................................ (0.51) (4.35)
---------- ----------
Net asset value, end of year .......................................... $ 59.94 $ 36.84
========== ==========
Total return (a) ...................................................... 64.47 % 17.54 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 3,086,057 $ 1,839,453
Ratio of expenses to average net assets (b) ......................... 0.83 % 0.87 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.25 % 0.80 %
Portfolio turnover rate (a) ......................................... 35.29 % 85.88 %

<CAPTION>
WRL JANUS GROWTH
--------------------------------------------------
DECEMBER 31,
--------------------------------------------------
1996 1995 1994
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 31.66 $ 23.81 $ 26.25
Income from operations:
Net investment income (loss) ........................................ 0.34 0.26 0.22
Net realized and unrealized gain (loss) on investments .............. 5.35 10.97 (2.41)
---------- ---------- -----------
Net income (loss) from operations .................................. 5.69 11.23 (2.19)
---------- ---------- -----------
Distributions:
Dividends from net investment income ................................ (0.35) (0.24) (0.22)
Dividends in excess of net investment income ........................ (0.01) 0.00 0.00
Distributions from net realized gains on investments ................ (1.99) (3.14) 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 (0.03)
---------- ---------- -----------
Total distributions ................................................ (2.35) (3.38) (0.25)
---------- ---------- -----------
Net asset value, end of year .......................................... $ 35.00 $ 31.66 $ 23.81
========== ========== ===========
Total return (a) ...................................................... 17.96 % 47.12 % (8.31)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 1,527,409 $ 1,195,174 $ 814,383
Ratio of expenses to average net assets (b) ......................... 0.88 % 0.86 % 0.84 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.98 % 0.90 % 0.88 %
Portfolio turnover rate (a) ......................................... 45.21 % 130.48 % 107.33 %
</TABLE>

<TABLE>
<CAPTION>
WRL JANUS GLOBAL
-------------------------------
DECEMBER 31,
-------------------------------
1998 1997
---------------- --------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 19.04 $ 18.12
Income from operations:
Net investment income (loss) ........................................ 0.05 0.08
Net realized and unrealized gain (loss) on investments .............. 5.61 3.32
---------- --------
Net income (loss) from operations .................................. 5.66 3.40
---------- --------
Distributions:
Dividends from net investment income ................................ (0.13) (0.13)
Dividends in excess of net investment income ........................ 0.00 (1.01)
Distributions from net realized gains on investments ................ (0.80) (1.34)
Distributions in excess of net realized gains on investments ........ (0.06) 0.00
---------- --------
Total distributions ................................................ (0.99) (2.48)
---------- --------
Net asset value, end of year .......................................... $ 23.71 $ 19.04
========== ========
Total return (a) ...................................................... 30.01 % 18.75 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 1,069,765 $ 785,966
Ratio of expenses to average net assets (b) ......................... 0.95 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.23 % 0.41 %
Portfolio turnover rate (a) ......................................... 87.36 % 97.54 %

<CAPTION>
WRL JANUS GLOBAL
--------------------------------------------
DECEMBER 31,
--------------------------------------------
1996 1995 1994
-------------- -------------- --------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 15.52 $ 13.12 $ 13.62
Income from operations:
Net investment income (loss) ........................................ 0.08 0.10 0.10
Net realized and unrealized gain (loss) on investments .............. 4.20 2.91 0.10
-------- -------- --------
Net income (loss) from operations .................................. 4.28 3.01 0.20
-------- -------- --------
Distributions:
Dividends from net investment income ................................ (0.04) 0.00 (0.10)
Dividends in excess of net investment income ........................ (0.17) 0.00 (0.01)
Distributions from net realized gains on investments ................ (1.47) (0.61) (0.56)
Distributions in excess of net realized gains on investments ........ 0.00 0.00 (0.03)
-------- -------- --------
Total distributions ................................................ (1.68) (0.61) (0.70)
-------- -------- --------
Net asset value, end of year .......................................... $ 18.12 $ 15.52 $ 13.12
======== ======== ========
Total return (a) ...................................................... 27.74 % 23.06 % 0.25 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 534,820 $ 289,506 $ 261,778
Ratio of expenses to average net assets (b) ......................... 0.99 % 0.99 % 1.01 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.46 % 0.75 % 0.73 %
Portfolio turnover rate (a) ......................................... 88.31 % 130.60 % 192.06 %
</TABLE>

Prospectus 54
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL LKCM STRATEGIC TOTAL
RETURN
-----------------------------
DECEMBER 31,
-----------------------------
1998 1997
-------------- --------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 15.62 $ 13.97
Income from operations:
Net investment income (loss) ........................................ 0.39 0.37
Net realized and unrealized gain (loss) on investments .............. 1.09 2.68
-------- --------
Net income (loss) from operations .................................. 1.48 3.05
-------- --------
Distributions:
Dividends from net investment income ................................ (0.38) (0.35)
Dividends in excess of net investment income ........................ 0.00 (0.03)
Distributions from net realized gains on investments ................ (0.32) (1.02)
Distributions in excess of net realized gains on investments ........ 0.00 0.00
-------- --------
Total distributions ................................................ (0.70) (1.40)
-------- --------
Net asset value, end of year .......................................... $ 16.40 $ 15.62
======== ========
Total return (a) ...................................................... 9.64 % 21.85 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 592,312 $ 526,577
Ratio of expenses to average net assets (b) ......................... 0.86 % 0.88 %
Ratio of net investment income (loss) to average net assets (b) ..... 2.43 % 2.43 %
Portfolio turnover rate (a) ......................................... 49.20 % 48.20 %

<CAPTION>
WRL LKCM STRATEGIC TOTAL RETURN
-------------------------------------------
DECEMBER 31,
-------------------------------------------
1996 1995 1994
-------------- -------------- -------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 12.86 $ 10.90 $ 11.23
Income from operations:
Net investment income (loss) ........................................ 0.37 0.37 0.31
Net realized and unrealized gain (loss) on investments .............. 1.56 2.33 (0.33)
-------- -------- --------
Net income (loss) from operations .................................. 1.93 2.70 (0.02)
-------- -------- --------
Distributions:
Dividends from net investment income ................................ (0.32) (0.37) (0.31)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ (0.50) (0.37) 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
-------- -------- --------
Total distributions ................................................ (0.82) (0.74) (0.31)
-------- -------- --------
Net asset value, end of year .......................................... $ 13.97 $ 12.86 $ 10.90
======== ======== ========
Total return (a) ...................................................... 15.00 % 24.66 % (0.53)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 390,141 $ 256,806 $ 183,867
Ratio of expenses to average net assets (b) ......................... 0.91 % 0.87 % 0.89 %
Ratio of net investment income (loss) to average net assets (b) ..... 2.72 % 3.07 % 2.78 %
Portfolio turnover rate (a) ......................................... 49.32 % 52.59 % 53.50 %
</TABLE>

<TABLE>
<CAPTION>
WRL VKAM EMERGING GROWTH
-----------------------------
DECEMBER 31,
-----------------------------
1998 1997
-------------- --------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 20.37 $ 18.46
Income from operations:
Net investment income (loss) ........................................ (0.08) (0.05)
Net realized and unrealized gain (loss) on investments .............. 7.56 4.03
-------- --------
Net income (loss) from operations .................................. 7.48 3.98
-------- --------
Distributions:
Dividends from net investment income ................................ 0.00 0.00
Dividends in excess of net investment income ........................ 0.00 0.00
Distributions from net realized gains on investments ................ (0.93) (2.07)
Distributions in excess of net realized gains on investments ........ 0.00 0.00
-------- --------
Total distributions ................................................ (0.93) (2.07)
-------- --------
Net asset value, end of year .......................................... $ 26.92 $ 20.37
======== ========
Total return (a) ...................................................... 37.33 % 21.45 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 853,440 $ 592,003
Ratio of expenses to average net assets (b) ......................... 0.89 % 0.93 %
Ratio of net investment income (loss) to average net assets (b) ..... (0.36)% (0.27)%
Portfolio turnover rate (a) ......................................... 99.50 % 99.78 %

<CAPTION>
WRL VKAM EMERGING GROWTH
-------------------------------------------
DECEMBER 31,
-------------------------------------------
1996 1995 1994
-------------- -------------- -------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 16.25 $ 11.55 $ 12.47
Income from operations:
Net investment income (loss) ........................................ (0.04) 0.01 0.01
Net realized and unrealized gain (loss) on investments .............. 3.10 5.42 (0.92)
-------- -------- --------
Net income (loss) from operations .................................. 3.06 5.43 (0.91)
-------- -------- --------
Distributions:
Dividends from net investment income ................................ 0.00 0.00 (0.01)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ (0.85) (0.73) 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
-------- -------- --------
Total distributions ................................................ (0.85) (0.73) (0.01)
-------- -------- --------
Net asset value, end of year .......................................... $ 18.46 $ 16.25 $ 11.55
======== ======== ========
Total return (a) ...................................................... 18.88 % 46.79 % (7.36)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 431,454 $ 288,519 $ 182,650
Ratio of expenses to average net assets (b) ......................... 0.94 % 0.91 % 0.92 %
Ratio of net investment income (loss) to average net assets (b) ..... (0.24)% 0.03 % 0.06 %
Portfolio turnover rate (a) ......................................... 80.02 % 124.13 % 72.62 %
</TABLE>

Prospectus 55
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL ALGER AGGRESSIVE GROWTH
---------------------------
DECEMBER 31,
---------------------------
1998 1997
------------- -------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 16.04 $ 14.18
Income from operations:
Net investment income (loss) ........................................ (0.04) (0.01)
Net realized and unrealized gain (loss) on investments .............. 7.68 3.44
---------- ----------
Net income (loss) from operations .................................. 7.64 3.43
---------- ----------
Distributions:
Dividends from net investment income ................................ 0.00 0.00
Dividends in excess of net investment income ........................ (0.05) (0.42)
Distributions from net realized gains on investments ................ (1.19) (1.15)
Distributions in excess of net realized gains on investments ........ 0.00 0.00
---------- ----------
Total distributions ................................................ (1.24) (1.57)
---------- ----------
Net asset value, end of year .......................................... $ 22.44 $ 16.04
========== ==========
Total return (a) ...................................................... 48.69 % 24.25 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 574,164 $ 336,166
Ratio of expenses to average net assets (b) ......................... 0.91 % 0.96 %
Ratio of net investment income (loss) to average net assets (b) ..... (0.21)% (0.06)%
Portfolio turnover rate (a) ......................................... 117.44 % 136.18 %

<CAPTION>
WRL ALGER AGGRESSIVE GROWTH
----------------------------------------
DECEMBER 31,
----------------------------------------
1996 1995 1994 (c)
------------- ------------- ------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 13.25 $ 9.86 $ 10.00
Income from operations:
Net investment income (loss) ........................................ (0.01) (0.06) 0.02
Net realized and unrealized gain (loss) on investments .............. 1.38 3.96 (0.14)
---------- ---------- ---------
Net income (loss) from operations .................................. 1.37 3.90 (0.12)
---------- ---------- ---------
Distributions:
Dividends from net investment income ................................ 0.00 0.00 (0.02)
Dividends in excess of net investment income ........................ (0.19) 0.00 0.00
Distributions from net realized gains on investments ................ (0.25) (0.51) 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
---------- ---------- ---------
Total distributions ................................................ (0.44) (0.51) (0.02)
---------- ---------- ---------
Net asset value, end of year .......................................... $ 14.18 $ 13.25 $ 9.86
========== ========== =========
Total return (a) ...................................................... 10.45 % 38.02 % (1.26)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 220,552 $ 158,534 $ 38,826
Ratio of expenses to average net assets (b) ......................... 0.98 % 1.07 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... (0.10)% (0.48)% (0.20)%
Portfolio turnover rate (a) ......................................... 101.28 % 108.04 % 89.73 %
</TABLE>

<TABLE>
<CAPTION>
WRL AEGON BALANCED
---------------------------
DECEMBER 31,
---------------------------
1998 1997
------------- -------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 12.01 $ 11.39
Income from operations:
Net investment income (loss) ........................................ 0.35 0.38
Net realized and unrealized gain (loss) on investments .............. 0.47 1.56
------- -------
Net income (loss) from operations .................................. 0.82 1.94
------- -------
Distributions:
Dividends from net investment income ................................ (0.28) (0.36)
Dividends in excess of net investment income ........................ 0.00 (0.30)
Distributions from net realized gains on investments ................ 0.00 (0.66)
Distributions in excess of net realized gains on investments ........ (0.01) 0.00
------- -------
Total distributions ................................................ (0.29) (1.32)
------- -------
Net asset value, end of year .......................................... $ 12.54 $ 12.01
======= =======
Total return (a) ...................................................... 6.93 % 17.10 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 95,000 $ 73,451
Ratio of expenses to average net assets (b) ......................... 0.91 % 0.94 %
Ratio of net investment income (loss) to average net assets (b) ..... 2.89 % 3.13 %
Portfolio turnover rate (a) ......................................... 83.94 % 77.06 %

<CAPTION>
WRL AEGON BALANCED
---------------------------------------
DECEMBER 31,
---------------------------------------
1996 1995 1994 (c)
------------ ------------- ------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 10.63 $ 9.24 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.34 0.44 0.34
Net realized and unrealized gain (loss) on investments .............. 0.80 1.38 (0.76)
------- ------- ---------
Net income (loss) from operations .................................. 1.14 1.82 (0.42)
------- ------- ---------
Distributions:
Dividends from net investment income ................................ (0.28) (0.43) (0.34)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ (0.10) 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
------- ------- ---------
Total distributions ................................................ (0.38) (0.43) (0.34)
------- ------- ---------
Net asset value, end of year .......................................... $ 11.39 $ 10.63 $ 9.24
======= ======= =========
Total return (a) ...................................................... 10.72 % 19.80 % (5.73)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $49,331 $ 31,114 $ 19,422
Ratio of expenses to average net assets (b) ......................... 0.97 % 0.97 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 3.14 % 4.38 % 4.27 %
Portfolio turnover rate (a) ......................................... 76.90 % 98.55 % 57.73 %
</TABLE>

Prospectus 56
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL FEDERATED GROWTH &
INCOME
---------------------------
DECEMBER 31,
---------------------------
1998 1997
------------- -------------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 12.56 $ 11.76
Income from operations:
Net investment income (loss) ........................................ 0.53 0.49
Net realized and unrealized gain (loss) on investments .............. (0.16) 2.35
------- --------
Net income (loss) from operations .................................. 0.37 2.84
------- --------
Distributions:
Dividends from net investment income ................................ (0.55) (0.43)
Dividends in excess of net investment income ........................ 0.00 (0.59)
Distributions from net realized gains on investments ................ (0.10) (1.02)
Distributions in excess of net realized gains on investments ........ 0.00 0.00
------- --------
Total distributions ................................................ (0.65) (2.04)
------- --------
Net asset value, end of year .......................................... $ 12.28 $ 12.56
======= ========
Total return (a) ...................................................... 3.05 % 24.65 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 87,616 $ 60,492
Ratio of expenses to average net assets (b) ......................... 0.90 % 0.96 %
Ratio of net investment income (loss) to average net assets (b) ..... 4.35 % 3.84 %
Portfolio turnover rate (a) ......................................... 97.17 % 155.77 %

<CAPTION>
WRL FEDERATED GROWTH & INCOME
----------------------------------------
DECEMBER 31,
----------------------------------------
1996 1995 1994 (c)
------------- ------------- ------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 11.12 $ 9.30 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.42 0.46 0.43
Net realized and unrealized gain (loss) on investments .............. 0.87 1.93 (0.70)
------- ------- ---------
Net income (loss) from operations .................................. 1.29 2.39 (0.27)
------- ------- ---------
Distributions:
Dividends from net investment income ................................ (0.33) (0.46) (0.43)
Dividends in excess of net investment income ........................ 0.00 0.00 0.00
Distributions from net realized gains on investments ................ (0.32) (0.11) 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
------- ------- ---------
Total distributions ................................................ (0.65) (0.57) (0.43)
------- ------- ---------
Net asset value, end of year .......................................... $ 11.76 $ 11.12 $ 9.30
======= ======= =========
Total return (a) ...................................................... 11.64 % 25.25 % (4.58)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 38,115 $ 24,607 $ 10,482
Ratio of expenses to average net assets (b) ......................... 1.00 % 1.00 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 3.73 % 4.56 % 5.36 %
Portfolio turnover rate (a) ......................................... 68.53 % 78.34 % 36.13 %
</TABLE>

<TABLE>
<CAPTION>
WRL DEAN ASSET
ALLOCATION
--------------
DECEMBER 31,
--------------
1998
--------------
<S> <C>
Net asset value, beginning of year .................................... $ 13.61
Income from operations:
Net investment income (loss) ........................................ 0.41
Net realized and unrealized gain (loss) on investments .............. 0.71
--------
Net income (loss) from operations .................................. 1.12
--------
Distributions:
Dividends from net investment income ................................ (0.39)
Dividends in excess of net investment income ........................ 0.00
Distributions from net realized gains on investments ................ (0.99)
Distributions in excess of net realized gains on investments ........ 0.00
--------
Total distributions ................................................ (1.38)
--------
Net asset value, end of year .......................................... $ 13.35
========
Total return (a) ...................................................... 8.33 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 365,738
Ratio of expenses to average net assets (b) ......................... 0.86 %
Ratio of net investment income (loss) to average net assets (b) ..... 2.93 %
Portfolio turnover rate (a) ......................................... 76.62 %

<CAPTION>
WRL DEAN ASSET ALLOCATION
--------------------------------------------
DECEMBER 31,
--------------------------------------------
1997 1996 1995 (d)
-------------- -------------- --------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 12.61 $ 11.49 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.36 0.33 0.41
Net realized and unrealized gain (loss) on investments .............. 1.72 1.33 1.93
-------- -------- --------
Net income (loss) from operations .................................. 2.08 1.66 2.34
-------- -------- --------
Distributions:
Dividends from net investment income ................................ (0.33) (0.30) (0.41)
Dividends in excess of net investment income ........................ (0.19) 0.00 0.00
Distributions from net realized gains on investments ................ (0.56) (0.24) (0.44)
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00
-------- -------- --------
Total distributions ................................................ (1.08) (0.54) (0.85)
-------- -------- --------
Net asset value, end of year .......................................... $ 13.61 $ 12.61 $ 11.49
======== ======== ========
Total return (a) ...................................................... 16.59 % 14.42 % 20.09 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 302,745 $ 206,172 $ 120,531
Ratio of expenses to average net assets (b) ......................... 0.87 % 0.90 % 0.93 %
Ratio of net investment income (loss) to average net assets (b) ..... 2.65 % 2.78 % 3.76 %
Portfolio turnover rate (a) ......................................... 63.76 % 98.97 % 38.68 %
</TABLE>

Prospectus 57
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL C.A.S.E. GROWTH
---------------------------------------------------
DECEMBER 31,
---------------------------------------------------
1998 1997 1996 1995 (e)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of year .................................... $ 14.01 $ 13.42 $ 11.66 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.02 0.04 0.12 0.12
Net realized and unrealized gain (loss) on investments .............. 0.31 1.95 1.92 2.49
-------- -------- -------- --------
Net income (loss) from operations .................................. 0.33 1.99 2.04 2.61
-------- -------- -------- --------
Distributions:
Dividends from net investment income ................................ (0.36) (0.03) (0.05) (0.12)
Dividends in excess of net investment income ........................ (0.90) (1.23) 0.00 0.00
Distributions from net realized gains on investments ................ (0.09) (0.14) (0.23) (0.83)
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00 0.00
-------- -------- -------- --------
Total distributions ................................................ (1.35) (1.40) (0.28) (0.95)
-------- -------- -------- --------
Net asset value, end of year .......................................... $ 12.99 $ 14.01 $ 13.42 $ 11.66
======== ======== ======== ========
Total return (a) ...................................................... 2.47 % 15.03 % 17.50 % 20.65 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 69,401 $ 60,596 $ 26,559 $ 2,578
Ratio of expenses to average net assets (b) ......................... 1.00 % 1.00 % 1.00 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.14 % 0.25 % 0.94 % 1.02 %
Portfolio turnover rate (a) ......................................... 205.28 % 196.50 % 160.27 % 121.62 %
</TABLE>

<TABLE>
<CAPTION>
WRL NWQ VALUE EQUITY
----------------------------------------------
DECEMBER 31,
----------------------------------------------
1998 1997 1996 (f)
-------------- -------------- ------------
<S> <C> <C> <C>
Net asset value, beginning of year .................................... $ 13.90 $ 11.27 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.12 0.12 0.10
Net realized and unrealized gain (loss) on investments .............. (0.78) 2.69 1.23
-------- -------- -------
Net income (loss) from operations .................................. (0.66) 2.81 1.33
-------- -------- -------
Distributions:
Dividends from net investment income ................................ (0.13) (0.09) (0.04)
Dividends in excess of net investment income ........................ (0.12) (0.07) 0.00
Distributions from net realized gains on investments ................ (0.62) (0.02) (0.02)
Distributions in excess of net realized gains on investments ........ (0.25) 0.00 0.00
-------- -------- -------
Total distributions ................................................ (1.12) (0.18) (0.06)
-------- -------- -------
Net asset value, end of year .......................................... $ 12.12 $ 13.90 $ 11.27
======== ======== =======
Total return (a) ...................................................... (4.78)% 25.04 % 13.19 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 157,157 $ 173,435 $ 49,394
Ratio of expenses to average net assets (b) ......................... 0.89 % 0.89 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.89 % 0.90 % 0.89 %
Portfolio turnover rate (a) ......................................... 43.60 % 17.28 % 7.93 %
</TABLE>

Prospectus 58
<PAGE>

FINANCIAL HIGHLIGHTS*

FOR THE YEAR ENDED

<TABLE>
<CAPTION>
WRL GE/SCOTTISH EQUITABLE
INTERNATIONAL EQUITY
--------------------------
DECEMBER 31,
--------------------------
1998 1997 (g)
------------ -----------
<S> <C> <C>
Net asset value, beginning of year .................................... $ 10.70 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.03 0.02
Net realized and unrealized gain (loss) on investments .............. 1.35 0.73
------- -------
Net income (loss) from operations .................................. 1.38 0.75
------- -------
Distributions:
Dividends from net investment income ................................ (0.01) (0.01)
Dividends in excess of net investment income ........................ 0.00 (0.04)
Distributions from net realized gains on investments ................ 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00
------- -------
Total distributions ................................................ (0.01) (0.05)
------- -------
Net asset value, end of year .......................................... $ 12.07 $ 10.70
======= =======
Total return (a) ...................................................... 12.85 % 7.50 %
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $32,149 $19,795
Ratio of expenses to average net assets (b) ......................... 1.50 % 1.50 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.30 % 0.18 %
Portfolio turnover rate (a) ......................................... 71.74 % 54.33 %
</TABLE>

<TABLE>
<CAPTION>
WRL
WRL J.P. MORGAN
WRL THIRD AVENUE REAL ESTATE
GE U.S. EQUITY VALUE SECURITIES
---------------------------- -------------- -------------
DECEMBER 31, DECEMBER 31, DECEMBER 31,
---------------------------- -------------- -------------
1998 1997 (g) 1998 (h) 1998 (i)
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Net asset value, beginning of year .................................... $ 12.23 $ 10.00 $ 10.00 $ 10.00
Income from operations:
Net investment income (loss) ........................................ 0.09 0.09 0.06 0.36
Net realized and unrealized gain (loss) on investments .............. 2.69 2.60 (0.74) (1.85)
-------- ------- ------- ---------
Net income (loss) from operations .................................. 2.78 2.69 (0.68) (1.49)
-------- ------- ------- ---------
Distributions:
Dividends from net investment income ................................ (0.15) (0.04) (0.03) 0.00
Dividends in excess of net investment income ........................ (0.33) (0.38) 0.00 0.00
Distributions from net realized gains on investments ................ (0.11) (0.04) 0.00 0.00
Distributions in excess of net realized gains on investments ........ 0.00 0.00 0.00 0.00
-------- ------- ------- ---------
Total distributions ................................................ (0.59) (0.46) (0.03) 0.00
-------- ------- ------- ---------
Net asset value, end of year .......................................... $ 14.42 $ 12.23 $ 9.29 $ 8.51
======== ======= ======= =========
Total return (a) ...................................................... 22.87 % 27.01 % (6.84)% (14.93)%
Ratios and supplemental data:
Net assets at end of year (in thousands) ............................ $ 110,803 $ 42,951 $ 18,206 $ 2,414
Ratio of expenses to average net assets (b) ......................... 1.05 % 1.30 % 1.00 % 1.00 %
Ratio of net investment income (loss) to average net assets (b) ..... 0.67 % 0.75 % 0.63 % 6.03 %
Portfolio turnover rate (a) ......................................... 63.08 % 92.35 % 4.35 % 100.80 %
</TABLE>

Prospectus 59
<PAGE>

FINANCIAL HIGHLIGHTS*

NOTES TO FINANCIAL HIGHLIGHTS:

* Per share information has been computed using average shares outstanding
throughout each year.
See Note 6.

(a) Not annualized for periods of less than one full year.
(b) Annualized for periods of less than one full year.
(c) The inception of this Portfolio was March 1, 1994.
(d) The inception of this Portfolio was January 3, 1995.
(e) The inception of this Portfolio was May 1, 1995.
(f) The inception of this Portfolio was May 1, 1996.
(g) The inception of this Portfolio was January 2, 1997.
(h) The inception of this Portfolio was January 2, 1998.
(i) The inception of this Portfolio was May 1, 1998.

NOTE 6 -- FINANCIAL HIGHLIGHTS

The total return set forth in "Financial Highlights" reflects the advisory fee
and all other portfolio expenses and includes reinvestment of dividends and
capital gains; if does not reflect the charges against the corresponding sub-
accounts or the charges and deductions under the applicable policies or annuity
contracts. Where a portfolio's period from inception is less than one year, the
total return shown is not annualized.

The ratio of expenses to average net assets in the Financial Highlights is net
of the advisory fee waiver. Where a portfolio's period from inception is less
than one year, the ratio of expenses to average net assets is annualized.
Without the advisory fee waived by WRL the ratio for each period presented
would be as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------------------
PORTFOLIO 1998 1997 1996 1995 1994
- --------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
WRL J.P. Morgan Money Market ............................... * * * * *
WRL AEGON Bond ............................................. * * * * *
WRL Janus Growth ........................................... * * * * *
WRL Janus Global ........................................... * * * * *
WRL LKCM Strategic Total Return ............................ * * * * *
WRL VKAM Emerging Growth ................................... * * * * *
WRL ALGER Aggressive Growth (a) ............................ * * * * 1.18%
WRL AEGON Balanced (a) ..................................... * * * * 1.34%
WRL Federated Growth & Income (a) .......................... * * * 1.08% 1.90%
WRL DEAN Asset Allocation (b) .............................. * * * * **
WRL C.A.S.E. Growth (c) .................................... * 1.13% 1.64% 4.15% **
WRL NWQ Value Equity (d).................................... * * 1.03% ** **
WRL GE/Scottish Equitable International Equity (e) ......... 1.96% 3.12% ** ** **
WRL GE U.S. Equity (e) ..................................... * 1.49% ** ** **
WRL Third Avenue Value (f) ................................. 1.13% ** ** ** **
WRL J.P. Morgan Real Estate Securities (g) ................. 3.34% ** ** ** **
</TABLE>

Prospectus 60
<PAGE>

FINANCIAL HIGHLIGHTS*

Without the advisory fee waived by WRL and the fees paid indirectly, the ratio
for each period presented would be as follows:

DECEMBER 31,
-----------------------
PORTFOLIO 1998 1997
- --------- ---------- ----------
WRL J.P. Morgan Money Market ........................ * *
WRL AEGON Bond ...................................... * *
WRL Janus Growth .................................... * *
WRL Janus Global .................................... * *
WRL LKCM Strategic Total Return ..................... * *
WRL VKAM Emerging Growth ............................ * *
WRL ALGER Aggressive Growth ......................... * *
WRL AEGON Balanced .................................. * *
WRL FEDERATED Growth & Income ....................... * *
WRL DEAN Asset Allocation ........................... * *
WRL C.A.S.E. Growth ................................. * 1.14%
WRL NWQ Value Equity ................................ * *
WRL GE/U.S. EQUITY International Equity (e) ......... 1.96% 3.14%
WRL G.E. U.S. Equity (e) ............................ * 1.54%
WRL Third Avenue Value (f) .......................... 1.13% **
WRL J.P. Morgan Real Estate Securities (g) .......... 3.34% **

* No waiver since the portfolio did not exceed expense limitations.
** Portfolio was not in existence during this period.
(a) The inception date of this portfolio was March 1, 1994.
(b) The inception date of this portfolio was January 3, 1995.
(c) The inception date of this portfolio was May 1, 1995.
(d) The inception date of this portfolio was May 1, 1996.
(e) The inception date of this portfolio was Janaury 2, 1997.
(f) The inception date of this portfolio was January 2, 1998.
(g) The inception date of this portfolio was May 1, 1998.

Prospectus 61
<PAGE>

ADDITIONAL INFORMATION ABOUT THESE PORTFOLIOS IS CONTAINED IN THE
STATEMENT OF ADDITIONAL INFORMATION, DATED MAY 1, 1999, AND IN THE
FUND'S ANNUAL AND SEMI-ANNUAL REPORTS TO SHAREHOLDERS, WHICH ARE
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS. IN THE FUND'S
ANNUAL REPORT, YOU WILL FIND A DISCUSSION OF THE MARKET CONDITIONS
AND INVESTMENT STRATEGIES THAT SIGNIFICANTLY AFFECTED THE FUND'S
PERFORMANCE DURING THE LAST FISCAL YEAR.

YOU MAY ALSO CALL 1-800-851-9777 TO REQUEST THIS ADDITIONAL
INFORMATION ABOUT THE FUND WITHOUT CHARGE OR TO MAKE SHAREHOLDER
INQUIRIES.

OTHER INFORMATION ABOUT THESE PORTFOLIOS HAS BEEN FILED WITH AND
IS AVAILABLE FROM THE U.S. SECURITIES AND EXCHANGE COMMISSION.
INFORMATION ABOUT THE FUND (INCLUDING THE SAI) CAN BE REVIEWED AND
COPIED AT THE SECURITIES AND EXCHANGE COMMISSION'S PUBLIC
REFERENCE ROOM IN WASHINGTON, D.C. INFORMATION ON THE OPERATION OF
THE PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING THE
COMMISSION AT 1-800-SEC-0330. INFORMATION MAY BE OBTAINED, UPON
PAYMENT OF A DUPLICATING FEE BY WRITING THE PUBLIC REFERENCE
SECTION OF THE COMMISSION, WASHINGTON, D.C. 20549-6009.

REPORTS AND OTHER INFORMATION ABOUT THE FUND ARE ALSO AVAILABLE ON
THE COMMISSION'S INTERNET SITE AT HTTP://WWW.SEC.GOV.
(WRL SERIES FUND FILE NO. 811-4419.)

FOR MORE INFORMATION ABOUT THESE PORTFOLIOS, YOU MAY OBTAIN A COPY
OF THE SAI OR THE ANNUAL OR SEMI-ANNUAL REPORTS WITHOUT CHARGE, OR
TO MAKE OTHER INQUIRIES ABOUT THIS FUND, CALL THE NUMBER LISTED
ABOVE.

(WRL SERIES FUND FILE NO. 811-4419.)