SUPPLEMENT DATED MAY 1, 1996
TO
PROSPECTUS DATED MAY 1, 1989
THE EQUITY PROTECTOR
THE FOLLOWING INFORMATION MODIFIES AND SUPPLEMENTS INFORMATION PROVIDED ON PAGE
4 OF THE PROSPECTUS UNDER THE HEADING "7. HOW ARE NET PREMIUMS ALLOCATED?", AND
ON PAGES 12-13 UNDER THE HEADING "INVESTMENTS OF THE SERIES ACCOUNT - WRL SERIES
FUND":
Beginning May 1, 1996, the Fund will offer two additional portfolios
("Portfolios"). Also, as of May 1, 1996, the Money Market Portfolio will have a
new sub-adviser, J.P. Morgan Investment Management Inc. The investment
objectives and policies of each new Portfolio and the Money Market Portfolio are
summarized below. There is no assurance that any of the Portfolios will achieve
its stated objective. More detailed information, including a description of
risks, can be found in the prospectus for each Portfolio, which should be read
carefully.
C.A.S.E. GROWTH PORTFOLIO: This Portfolio's objective is capital growth
through investments in small to medium-sized companies.
VALUE EQUITY PORTFOLIO: This Portfolio seeks to achieve maximum,
consistent total return with minimum risk to principal by investing primarily in
common stocks with above-average statistical value which, in the Sub-Adviser's
opinion, are in fundamentally attractive industries and are undervalued at the
time of purchase.
MONEY MARKET PORTFOLIO: This Portfolio's objective is to obtain maximum
current income consistent with preservation of principal and maintenance of
liquidity.
Western Reserve continues to serve as investment adviser to each Portfolio
of the Fund and manages the assets of each Portfolio in accordance with
policies, programs and guidelines established by the Board of Directors of the
Fund.
C.A.S.E. Management, Inc. ("C.A.S.E."), located at 2255 Glades Road, Boca
Raton, Florida 33431, is sub-adviser to the C.A.S.E. Growth Portfolio of the
Fund. C.A.S.E. is a registered investment advisory firm and a wholly-owned
subsidiary of C.A.S.E. Inc. C.A.S.E. Inc. is indirectly controlled by William
Edward Lange, president and chief executive officer of C.A.S.E. C.A.S.E.
provides investment management services to financial institutions, high net
worth individuals, and other professional money managers. Western Reserve and
C.A.S.E. will divide equally monthly compensation at the current annual rate of
0.80% of the aggregate average daily net assets of the C.A.S.E. Growth
Portfolio.
NWQ Investment Management Company, Inc. ("NWQ Investment"), located at 655
South Hope Street, 11th Floor, Los Angeles, California 90017, is sub-adviser to
the Value Equity Portfolio of the Fund. NWQ Investment was founded in 1982 and
is a wholly-owned subsidiary of United Asset Management Corporation. NWQ
Investment provides investment management services to institutions and high net
worth individuals. As of December 31, 1995, NWQ Investment had over $5.6 billion
in assets under management. Western Reserve and NWQ Investment will divide
equally monthly compensation at the current annual rate of 0.80% of the
aggregate average daily net assets of the Value Equity Portfolio. NWQ
Investment's compensation will be reduced by 50% of the amount paid by Western
Reserve on behalf of the Value Equity Portfolio pursuant to any expense
limitation or other reimbursement.
J.P. Morgan Investment Management Inc. ("J.P. Morgan"), located at 522
Fifth Avenue, New York, New York 10036, is sub-adviser to the Money Market
Portfolio of the Fund. Keith M. Schappert is the President and Chief Executive
Officer of J.P. Morgan. J.P. Morgan is a wholly-owned subsidiary of J.P.
<PAGE>
Morgan & Co. Incorporated. J.P. Morgan provides investment management and
related services for corporate, public and union employee benefit funds,
foundations, endowments, insurance companies and government agencies. Western
Reserve will receive monthly compensation at the current annual rate of 0.40% of
the aggregate average daily net assets of the Money Market Portfolio. From this
amount, as compensation for its services, J.P. Morgan will receive 0.15% of the
average daily net assets of the Money Market Portfolio.
THE FOLLOWING INFORMATION MODIFIES, "APPENDIX A - ILLUSTRATION OF BENEFITS", ON
PAGES 33-35 OF THE PROSPECTUS:
The information contained in both the explanation and "Hypothetical
Illustrations" is out-of-date and should not be relied upon. In addition,
current hypothetical illustrations for the new Portfolios are not included in
Appendix A.
THE FOLLOWING INFORMATION REPRESENTS BOTH THE ACTUAL ANNUAL EXPENSES OF THE
EXISTING PORTFOLIOS INCURRED DURING 1995, AND THE ESTIMATED ANNUAL EXPENSES, AS
A PERCENTAGE OF AVERAGE NET ASSETS, OF THE NEW PORTFOLIOS:
<TABLE>
<CAPTION>
SHORT-TO-
MONEY INTERMEDIATE EMERGING EQUITY-
MARKET GROWTH GLOBAL BOND GOVERNMENT GROWTH INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.40% 0.80% 0.80% 0.50% 0.60% 0.80% 0.80%
Other Expenses 0.06% 0.06% 0.19% 0.11% 0.18% 0.11% 0.07%
(After Reimbursement)
Total Fund Annual
Expenses 0.46% 0.86% 0.99% 0.61% 0.78% 0.91% 0.87%
</TABLE>
<TABLE>
<CAPTION>
TACTICAL
AGGRESSIVE ASSET C.A.S.E. VALUE
GROWTH BALANCED UTILITY ALLOCATION GROWTH EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- --------- --------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Management Fees 0.80% 0.80% 0.75% 0.80% 0.80% 0.80%
Other Expenses 0.12% 0.17% 0.25% 0.13% 0.20% 0.20%
(After Reimbursement)
Total Fund Annual
Expenses 0.92% 0.97% 1.00% 0.93% 1.00% 1.00%
<FN>
** Because the Value Equity Portfolio commenced operations on May 1, 1996 and
C.A.S.E. Growth Portfolio commenced operations on May 1, 1995, the
percentages set forth for these Portfolios as "Other Expenses" and "Total
Fund Annual Expenses" are estimates. Expenses of the Portfolios of the Fund
may be higher or lower in the future.
</FN>
</TABLE>
<PAGE>
SUPPLEMENT DATED JANUARY 3, 1995
TO
PROSPECTUS DATED MAY 1, 1989
AS
SUPPLEMENTED DATED MAY 1, 1994
THE EQUITY PROTECTOR
THE FOLLOWING INFORMATION MODIFIES AND SUPPLEMENTS INFORMATION PROVIDED ON PAGE
4 OF THE PROSPECTUS UNDER THE HEADING "7. HOW ARE NET PREMIUMS ALLOCATED?", AND
ON PAGES 12-13 UNDER THE HEADING "INVESTMENTS OF THE SERIES ACCOUNT - WRL SERIES
FUND":
Beginning January 3, 1995, the Fund will offer an additional portfolio
("Portfolio"). The investment objectives and policies of the new Portfolio are
summarized below. There is no assurance that the Portfolio will achieve its
stated objective. More detailed information, including a description of risks,
can be found in the prospectus for the Portfolio, which should be read
carefully.
TACTICAL ASSET ALLOCATION PORTFOLIO: This Portfolio seeks preservation of
capital and competitive investment returns by investing primarily in stocks,
United States Treasury bonds, notes and bills, and money market funds.
Western Reserve serves as investment adviser to the Fund and manages its
assets in accordance with policies, programs and guidelines established by the
Board of Directors of the Fund.
Dean Investment Associates, a Division of C.H. Dean and Associates, Inc.
("Dean") is sub-adviser to the Tactical Asset Allocation Portfolio of the Fund.
Dean, located at 2480 Kettering Tower, Dayton, Ohio 45423-2480, is a registered
investment adviser with the Securities and Exchange Commission. Dean is
wholly-owned by C.H. Dean and Associates, Inc. Founded in 1972, Dean Investments
manages portfolios for individuals and institutional clients worldwide. Dean
provides a full range of investment advisory services and currently has over $4
billion of assets under management. Western Reserve and Dean will divide equally
monthly compensation at the current annual rate of 0.80% of the aggregate
average daily net assets of the Tactical Asset Allocation Portfolio. Dean's
compensation will be reduced by 50% of the amount paid by Western Reserve on
behalf of the Tactical Asset Allocation Portfolio pursuant to any expense
limitation or other reimbursement.
In addition to the Series Account, shares of the Fund are also sold to the
WRL Series Annuity Account, a separate account established by Western Reserve
for its variable annuity contracts, the PFL Endeavor Variable Annuity Account, a
separate account of PFL Life Insurance Company, the ILI Endeavor Variable
Annuity Account, a separate account of International Life Investors Insurance
Company, and to the AUSA Series Life Account, a separate account of AUSA Life
Insurance Company, Inc., all affiliates of Western Reserve. Shares of the Fund
may in the future be sold to other separate accounts, including separate
accounts established for variable life insurance polices or variable annuity
contracts issued by Western Reserve or its affiliates. It is conceivable that,
in the future, it may become disadvantageous for variable life insurance
separate accounts and variable annuity separate accounts to invest in the Fund
simultaneously. Although neither Western Reserve nor the Fund currently foresees
any such disadvantages, either to variable life insurance policyowners or to
variable annuity contract owners, the Fund's Board of Directors intends to
monitor events in order to identify any material conflicts between the interests
of such variable life insurance policyowners and variable annuity contract
owners and to determine what action, if any, it should take. Such action could
include the sale of Fund shares by one or more of the separate accounts, which
could have adverse consequences. Material conflicts could result from, for
example, (1) changes in state insurance laws, (2) changes in Federal income tax
laws, or (3) differences in voting instructions between those given by variable
life insurance policyowners and those given by variable annuity contract owners.
If the Board of Directors were to conclude that separate funds should be
established for variable life and variable annuity separate accounts, Western
Reserve will bear the attendant expenses, but variable life insurance
policyowners and variable annuity contract owners would no longer have the
economies of scale resulting from a larger combined fund.
<PAGE>
THE FOLLOWING INFORMATION MODIFIES "APPENDIX A - ILLUSTRATION OF BENEFITS", ON
PAGES 33-35 OF THE PROSPECTUS:
The information contained in both the explanation and "Hypothetical
Illustrations" is out-of-date and should not be relied upon. In addition,
current hypothetical illustrations for the new Portfolios are not included in
Appendix A.
THE FOLLOWING INFORMATION REPRESENTS BOTH THE ACTUAL ANNUAL EXPENSES OF THE
EXISTING PORTFOLIOS INCURRED DURING 1993, AND THE ESTIMATED ANNUAL EXPENSES, AS
A PERCENTAGE OF AVERAGE NET ASSETS, OF THE NEW PORTFOLIOS:
<TABLE>
<CAPTION>
SHORT-TO-
MONEY INTERMEDIATE EMERGING EQUITY-
MARKET GROWTH GLOBAL BOND GOVERNMENT GROWTH INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.50% 0.80% 0.80% 0.50% 0.60% 0.80% 0.80%
Other Expenses 0.16% 0.07% 0.29% 0.14% 0.40% 0.20% 0.20%
(After Reimbursement)
Total Fund Annual
Expenses 0.66% 0.87% 1.09% 0.64% 1.00% 1.00% 1.00%
</TABLE>
<TABLE>
<CAPTION>
TACTICAL
AGGRESSIVE ASSET
GROWTH BALANCED UTILITY ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- --------- --------- ----------
<S> <C> <C> <C> <C>
Management Fees 0.80% 0.80% 0.80% 0.80%
Other Expenses 0.20% 0.20% 0.20% 0.12%
(After Reimbursement)
Total Fund Annual
Expenses 1.00% 1.00% 1.00% 0.92%
<FN>
** Because the Aggressive Growth, Balanced and Utility Portfolios commenced
operations on March 1, 1994, and the Tactical Asset Allocation Portfolio
commenced operations on January 3, 1995, the percentages set forth as
"Other Expenses" and "Total Fund Annual Expenses" are estimates.
</FN>
</TABLE>
<PAGE>
SUPPLEMENT DATED MAY 1, 1994
TO
PROSPECTUS DATED MAY 1, 1989
THE EQUITY PROTECTOR
THE FOLLOWING INFORMATION MODIFIES AND SUPPLEMENTS INFORMATION PROVIDED ON PAGE
4 OF THE PROSPECTUS UNDER THE HEADING "7. HOW ARE NET PREMIUMS ALLOCATED?", AND
ON PAGES 12-13 UNDER THE HEADING "INVESTMENTS OF THE SERIES ACCOUNT - WRL SERIES
FUND":
Beginning May 1, 1994, the Fund will offer four, additional portfolios
("Portfolios"). The investment objectives and policies of each of the new
Portfolios are summarized below. There is no assurance that any of the
Portfolios will achieve its stated objective. More detailed information,
including a description of risks, can be found in the prospectus for each of the
Portfolios, which should be read carefully.
AGGRESSIVE GROWTH PORTFOLIO: This Portfolio seeks long-term capital
appreciation by investing in a diversified, actively managed portfolio of equity
securities.
BALANCED PORTFOLIO: This Portfolio seeks preservation of capital, reduced
volatility, and superior long-term risk-adjusted returns by investing primarily
in common stock, convertible securities and fixed-income securities.
GLOBAL PORTFOLIO: This Portfolio seeks long-term growth of capital in a
manner consistent with preservation of capital, primarily through investments in
common stocks of foreign and domestic issuers.
UTILITY PORTFOLIO: This Portfolio's objective is to achieve high current
income and moderate capital appreciation by investing primarily in a
professionally managed and diversified portfolio of equity and debt securities
of utility companies.
Western Reserve serves as investment adviser to the Fund and manages its
assets in accordance with policies, programs and guidelines established by the
Board of Directors of the Fund.
Janus Capital Corporation ("Janus") serves as sub-adviser to the Growth,
Money Market, Bond and Global Portfolios of the Fund. Janus, located at 100
Fillmore Street, Suite 300, Denver, CO 80206, has been engaged in the management
of the Janus funds since 1969. Janus also has served as investment adviser or
sub-adviser to other mutual funds, and for individual, corporate, charitable,
and retirement accounts. The aggregate market value of the assets managed by
Janus was approximately $22 billion as of February 1, 1994. Western Reserve and
Janus will divide equally monthly compensation at current annual rates of 0.50%
of the aggregate average daily net assets each of the Money Market Portfolio and
the Bond Portfolio and 0.80% of the aggregate average daily net assets each of
the Growth Portfolio and Global Portfolio.
AEGON USA Investment Management, Inc. ("AEGON Management") is sub-adviser
to the Balanced Portfolio and Short-to-Intermediate Government Portfolio of the
Fund. AEGON Management, located at 4333 Edgewood Road, N.E., Cedar Rapids, Iowa
52499, is a wholly-owned subsidiary of AEGON USA, Inc. ("AEGON") and thus is an
affiliate of Western Reserve. AEGON Management also serves as sub-adviser to the
two bond portfolios of IDEX II Series Fund. In addition, AEGON Management
manages the general account investment portfolios of the life insurance
subsidiaries of
<PAGE>
AEGON, which had in excess of $17.5 billion under management as of January 1,
1994. Western Reserve and AEGON Management will divide equally monthly
compensation at the current annual rate of 0.60% of the aggregate average daily
net assets of the Short-to-Intermediate Government Portfolio and 0.80% of the
aggregate average daily net assets of the Balanced Portfolio. AEGON Management's
compensation will be reduced by 50% of the amount paid by Western Reserve on
behalf of the Short-to-Intermediate Government Portfolio and Balanced Portfolio
pursuant to any expense limitation or other reimbursement.
Federated Investment Counseling ("Federated") is sub-adviser to the
Utility Portfolio of the Fund. Federated, located at Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779, is a Delaware business trust organized on
April 11, 1989 and is a registered investment adviser under the Investment
Advisers Act of 1940. It is a subsidiary of Federated Investors. Federated
serves as investment adviser to a number of investment companies and private
accounts. Total assets under management or administration by Federated and other
subsidiaries of Federated Investors is approximately $79 billion. Western
Reserve will receive monthly compensation at the current annual rate of 0.75% of
the aggregate average daily net assets of the Utility Portfolio. From this
amount, as compensation for its services, Federated will receive payment of fees
equal to 0.50% of the first $30 million of average daily net assets, 0.35% of
the next $20 million of average daily net assets, and 0.25% of average daily net
assets in excess of $50 million of the Utility Portfolio.
Fred Alger Management, Inc. ("Fred Alger") is sub-adviser to the
Aggressive Growth Portfolio of the Fund. Fred Alger, located at 75 Maiden Lane,
New York, NY 10038, is a wholly-owned subsidiary of Fred Alger & Company,
Incorporated, which in turn is a wholly-owned subsidiary of Alger Associates,
Inc., a financial services holding company controlled by Fred M. Alger. Fred
Alger has approximately $2.5 billion in assets under management for investment
companies and private accounts. Western Reserve and Fred Alger will divide
equally monthly compensation at the current rate of 0.80% of the aggregate
average daily net assets of the Aggressive Growth Portfolio.
In addition to the Series Account, shares of the Fund are also sold to the
WRL Series Annuity Account, a separate account established by Western Reserve
for its variable annuity contracts, and to the PFL Endeavor Variable Annuity
Account, a separate account of PFL Life Insurance Company, and ILI Endeavor
Variable Annuity Account, a separate account of International Life Investors
Insurance Company, both affiliates of Western Reserve. Shares of the Fund may in
the future be sold to other separate accounts, including separate accounts
established for variable life insurance polices or variable annuity contracts
issued by Western Reserve or its affiliates. It is conceivable that, in the
future, it may become disadvantageous for variable life insurance separate
accounts and variable annuity separate accounts to invest in the Fund
simultaneously. Although neither Western Reserve nor the Fund currently foresees
any such disadvantages, either to variable life insurance policyowners or to
variable annuity contract owners, the Fund's Board of Directors intends to
monitor events in order to identify any material conflicts between the interests
of such variable life insurance policyowners and variable annuity contract
owners and to determine what action, if any, it should take. Such action could
include the sale of Fund shares by one or more of the separate accounts, which
could have adverse consequences. Material conflicts could result from, for
example, (1) changes in state insurance laws, (2) changes in Federal income tax
laws, or (3) differences in voting instructions between those given by variable
life insurance policyowners and those given by variable annuity contract owners.
If the Board of Directors were to conclude that separate funds should be
established for variable life and variable annuity separate accounts, Western
Reserve will bear the attendant expenses, but variable life insurance
policyowners and variable annuity contract owners would no longer have the
economies of scale resulting from a larger combined fund.
<PAGE>
THE FOLLOWING INFORMATION MODIFIES, "APPENDIX A - ILLUSTRATION OF BENEFITS", ON
PAGES 33-35 OF THE PROSPECTUS:
The information contained in both the explanation and "Hypothetical
Illustrations" is out-of-date and should not be relied upon. In addition,
current hypothetical illustrations for the new Portfolios are not included in
Appendix A.
THE FOLLOWING INFORMATION REPRESENTS BOTH THE ACTUAL ANNUAL EXPENSES OF THE
EXISTING PORTFOLIOS INCURRED DURING 1993, AND THE ESTIMATED ANNUAL EXPENSES, AS
A PERCENTAGE OF AVERAGE NET ASSETS, OF THE NEW PORTFOLIOS:
<TABLE>
<CAPTION>
SHORT-TO-
MONEY INTERMEDIATE EMERGING EQUITY-
MARKET GROWTH GLOBAL BOND GOVERNMENT GROWTH INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ------------ --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.50% 0.80% 0.80% 0.50% 0.60% 0.80% 0.80%
Other Expenses 0.16% 0.07% 0.29% 0.14% 0.40% 0.20% 0.20%
(After Reimbursement)
Total Fund Annual
Expenses 0.66% 0.87% 1.09% 0.64% 1.00% 1.00% 1.00%
</TABLE>
<TABLE>
<CAPTION>
AGGRESSIVE
GROWTH BALANCED UTILITY
PORTFOLIO PORTFOLIO PORTFOLIO
---------- --------- ---------
<S> <C> <C> <C>
Management Fees 0.80% 0.80% 0.80%
Other Expenses 0.20% 0.20% 0.20%
(After Reimbursement)
Total Fund Annual
Expenses 1.00% 1.00% 1.00%
<FN>
** Because the Emerging Growth and Equity-Income Portfolios commenced
operations on March 1, 1993, and the Utility, Balanced and Aggressive Growth
Portfolios commenced operations on March 1, 1994, the percentages set forth
as "Other Expenses" and "Total Fund Annual Expenses" for the fiscal year
ended December 31, 1993 are estimates. Expenses of the Portfolios of the
Fund may be higher or lower in the future.
</FN>
</TABLE>
