AMERITAS VARIABLE LIFE INSURANCE COMPANY
SEPARATE ACCOUNT V (ENCORE!)
Supplement to Prospectus dated May 1, 1998
The prospectus is amended at pages 6, 9, 21, 30 and Appendix A to disclose that
the current mortality and expense risk charge is charged at an annual rate of
.70% for policy years 1 - 4, .45% for policy years 5 - 20, and .30% for the
years thereafter; and the total daily charge for mortality and expense risks and
administrative expenses is at an annual rate of .70% for policy years 1 - 20,
and .45% for the years thereafter. The maximum charge is 1.15%.
The prospectus is further amended at page 33, under the section "Distribution of
the Policies," to disclose that during the first Policy Year, the commission may
equal an amount up to 95% of the first year target premium paid plus the first
year cost of any riders and 2% for premiums paid in excess of the first year
target premium.
Appendix A, appearing at pages 77 - 81 of the prospectus, is amended by
replacing current Appendix A, in its entirety, with the following revised
Appendix A.
<PAGE>
APPENDIX A
ILLUSTRATIONS OF DEATH BENEFITS AND CASH VALUES
The following tables illustrate how the cash values and death benefits of a
Policy may change with the investment experience of the Fund. The tables show
how the cash values and death benefits of a Policy issued to an Insured of a
given age and specified underwriting risk classification who pays the given
premium at issue would vary over time if the investment return on the assets
held in each portfolio of the Funds were a uniform, gross, after-tax annual rate
of 0%, 6%, or 12%. The tables on pages 78 through 81 illustrate a Policy issued
to a male, age 45, under a Preferred rate non-tobacco underwriting risk
classification. This policy provides for a standard tobacco use and non-tobacco
use, and preferred non-tobacco classification and different rates for certain
specified amounts. The cash values and death benefits would be different from
those shown if the gross annual investment rates of return averaged 0%, 6%, and
12% over a period of years, but fluctuated above and below those averages for
individual policy years, or if the Insured were assigned to a different
underwriting risk classification.
The second column of the tables shows the accumulated value of the premiums paid
at 5%. The following columns show the death benefits and the cash values for
uniform hypothetical rates of return shown in these tables. The tables on pages
78 and 80 are based on the current cost of insurance rates, current expense
deductions and the maximum percent of premium loads. These reflect the basis on
which AVLIC currently sells its Policies. The maximum allowable cost of
insurance rates under the Policy are based upon the 1980 Commissioner's Standard
Ordinary Smoker and Non-Smoker, Male and Female Mortality Tables (Smoker is
referenced for tobacco use rates; Non-Smoker is referenced for non-tobacco use
rates). Since these are recent tables and are split to reflect tobacco use and
sex, the current cost of insurance rates used by AVLIC are at this time equal to
the maximum cost of insurance rates for many ages. AVLIC anticipates reflecting
future improvements in actual mortality experience through adjustments in the
current cost of insurance rates actually applied. AVLIC also anticipates
reflecting any future improvements in expenses incurred by applying lower
percent of premiums of loads and other expense deductions. The death benefits
and cash values shown in the tables on pages 79 and 81 are based on the
assumption that the maximum allowable cost of insurance rates as described above
and maximum allowable expense deductions are made throughout the life of the
Policy.
The amounts shown for the death benefits, surrender values and accumulation
values reflect the fact that the net investment return of the Subaccounts is
lower than the gross, after-tax return of the assets held in the Funds as a
result of expenses paid by the Fund and charges levied against the Subaccounts.
The values shown take into account an average of the expenses paid by each
portfolio available for investment (the equivalent to an annual rate of .87% of
the aggregate average daily net assets of the Fund) and the daily charge by
AVLIC to each Subaccount for assuming mortality and expense risks and
administrative expenses (which is equivalent to a charge at an annual rate of
.70% for policy years 1-20 and .45% thereafter on pages 78 and 80 and at an
annual rate of 1.15% on pages 79 and 81 of the average net assets of the
Subaccounts). A portion of the brokerage commissions that certain Fidelity Funds
pay was used to reduce funds expenses. In addition, certain Fidelity Funds have
entered into arrangements with their custodian and transfer agent whereby
interest earned on uninvested cash balances was used to reduce custodian and
transfer agent expenses. Without these reductions, expenses would have been
higher. The Investment Advisor or other affiliates of the various funds have
agreed to reimburse the portfolios to the extent that the aggregate operating
expenses (certain portfolio's may exclude certain items) were in excess of an
annual rate of .28% for the Index 500 Portfolio, 1.25% for the Alger American
Income and Growth and Alger American Balanced Portfolio; 1.50% for the Alger
American Small Capitalization, Alger American Mid-Cap Growth, Alger American
Leveraged All Cap, and Alger American Growth Portfolios; 1.75% for the Morgan
Stanley Emerging Markets Equity, 1.20% for the Morgan Stanley Asian Equity,
1.15% for the Morgan Stanley Global Equity and Morgan Stanley International
Magnum, 1.10% for the Morgan Stanley U.S. Real Estate Portfolios of daily net
assets. MFS has agreed to bear expenses for each series, subject to
reimbursement by each series, such that each series "Other Expenses" shall not
exceed .25% of the average daily net assets of the series during the current
fiscal year. These agreements are expected to continue in future years but may
be terminated at any time. As long as the expense limitations continue for a
portfolio, if a reimbursement occurs, it has the effect of lowering the
portfolio's expense ratio and increasing its total return. The illustrated gross
annual investment rates of return of 0%, 6%, and 12% were computed after
deducting fund expenses and correspond to approximate net annual rates of
- -1.57%, 4.43%, and 10.43% respectively, for years 1-20 and -1.32%, 4.68%, and
10.68% for the years thereafter respectively, on pages 78 and 80 and -2.02%,
3.98%, and 9.98% respectively, on pages 79 and 81.
The hypothetical values shown in the tables do not reflect any charges for
Federal Income tax burden attributable to the Separate Account, since AVLIC is
not currently making such charges. However, such charges may be made in the
future and, in that event, the gross annual investment rate of return would have
to exceed 0 percent, 6 percent, or 12 percent by an amount sufficient to cover
the tax charges in order to produce the death benefits and values illustrated.
(See Federal Tax Matters, page 33.)
The tables illustrate the policy values that would result based upon the
hypothetical investment rates of return if premiums are paid as indicated, if
all net premiums are allocated to the Separate Account, and if no policy loans
have been made. The tables are also based on the assumptions that the
policyowner has not requested an increase or decrease in the initial Specified
Amount, that no partial withdrawals have been made, and that no more than
fifteen transfers have been made in any policy year so that no transfer charges
have been incurred. Illustrated values would be different if the proposed
Insured were female, a tobacco user, in substandard risk classification, or were
another age, or if a higher or lower premium was illustrated.
Upon request, AVLIC will provide comparable illustration based upon the proposed
Insured's age, sex and underwriting classification, the Specified Amount, the
death benefit option, and planned periodic premium schedule requested, and any
available riders requested. In addition, upon client request, illustrations may
be furnished reflecting allocation of premiums to specified Subaccounts. Such
illustrations will reflect the expenses of the portfolio in which the Subaccount
invests.
ENCORE! 77
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATION OF POLICY VALUES
AMERITAS VARIABLE LIFE INSURANCE COMPANY
ENDOWMENT AT AGE 100
Male Issue Age: 45 Nontobacco Preferred Underwriting Class
PLANNED PERIODIC ANNUAL PREMIUM: $6000
INITIAL SPECIFIED AMOUNT: $500000
DEATH BENEFIT OPTION: A
USING CURRENT SCHEDULE OF COST OF INSURANCE RATES
0% Hypothetical Gross 6% Hypothetical Gross 12% Hypothetical Gross
Annual Investment Return Annual Investment Return Annual Investment Return
(-1.57% Net) ( 4.43% Net) (10.43% Net)
----------------------------- -------------------------- --------------------------
Accumulated
End Of Premiums At Accumu- Cash Accumu- Cash Accumu- Cash
Policy 5% Interest lation Surrender Death lation Surrender Death lation Surrender Death
Year Per Year Value Value Benefit Value Value Benefit Value Value Benefit
---- -------- ----- ----- ------- ----- ----- ------- ------- ------ ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 6300 4417 0 500000 4723 0 500000 5029 0 500000
2 12915 8658 1943 500000 9546 2831 500000 10473 3758 500000
3 19860 12724 6009 500000 14474 7759 500000 16374 9659 500000
4 27153 16619 9904 500000 19512 12797 500000 22784 16069 500000
5 34811 20342 13627 500000 24665 17950 500000 29756 23041 500000
6 42852 23897 17854 500000 29940 23896 500000 37355 31312 500000
7 51294 27279 21907 500000 35336 29964 500000 45644 40272 500000
8 60159 30496 25796 500000 40867 36167 500000 54708 50007 500000
9 69467 33543 29514 500000 46534 42505 500000 64626 60597 500000
10 79240 36418 33061 500000 52342 48984 500000 75494 72136 500000
15 135944 48163 48163 500000 83703 83703 500000 148287 148287 500000
20 208315 54513 54513 500000 118901 118901 500000 267208 267208 500000
Ages
60 135944 48163 48163 500000 83703 83703 500000 148287 148287 500000
65 208315 54513 54513 500000 118901 118901 500000 267208 267208 500000
70 300680 49520 49520 500000 155435 155435 500000 470885 470885 546227
75 418564 22804 22804 500000 186866 186866 500000 819592 819592 876964
</TABLE>
1) Assumes an annual $6000 premium is paid at the beginning of each policy year.
Values would be different if premiums with a different frequency or in different
amounts.
2) Assumes that no policy loan has been made. Excessive loans or withdrawals may
cause this policy to lapse because of insufficient cash value.
THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF RETURN MAY BE MORE OR
LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
INVESTMENT ALLOCATIONS MADE BY AN OWNER, DEATH BENEFIT OPTION SELECTED,
PREVAILING INTEREST RATES AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES OF
RETURN AVERAGED 0%, 6%, AND 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO REPRESENTATIONS
CAN BE MADE BY AVLIC OR THE FUNDS THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE
ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER ANY PERIOD OF TIME.
78 ENCORE!
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATION OF POLICY VALUES
AMERITAS VARIABLE LIFE INSURANCE COMPANY
ENDOWMENT AT AGE 100
Male Issue Age: 45 Nontobacco Preferred Underwriting Class
PLANNED PERIODIC ANNUAL PREMIUM: $6000
INITIAL SPECIFIED AMOUNT: $500000
DEATH BENEFIT OPTION: A
USING MAXIMUM ALLOWABLE SCHEDULE OF COST OF INSURANCE RATES
0% Hypothetical Gross 6% Hypothetical Gross 12% Hypothetical Gross
Annual Investment Return Annual Investment Return Annual Investment Return
(-2.02% Net) ( 3.98% Net) ( 9.98% Net)
----------------------------- -------------------------- --------------------------
Accumulated
End Of Premiums At Accumu- Cash Accumu- Cash Accumu- Cash
Policy 5% Interest lation Surrender Death lation Surrender Death lation Surrender Death
Year Per Year Value Value Benefit Value Value Benefit Value Value Benefit
---- -------- ----- ----- ------- ----- ----- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 6300 4417 0 500000 4723 0 500000 5029 0 500000
2 12915 8045 1330 500000 8911 2196 500000 9815 3100 500000
3 19860 11496 4781 500000 13161 6446 500000 14974 8259 500000
4 27153 14743 8028 500000 17446 10731 500000 20514 13799 500000
5 34811 17770 11055 500000 21749 15034 500000 26458 19743 500000
6 42852 20575 14532 500000 26066 20022 500000 32843 26800 500000
7 51294 23131 17759 500000 30365 24993 500000 39687 34315 500000
8 60159 25410 20710 500000 34617 29917 500000 47011 42310 500000
9 69467 27392 23363 500000 38797 34768 500000 54844 50815 500000
10 79240 29039 25682 500000 42865 39507 500000 63210 59852 500000
15 135944 31349 31349 500000 60322 60322 500000 114604 114604 500000
20 208315 19663 19663 500000 67950 67950 500000 187786 187786 500000
Ages
60 135944 31349 31349 500000 60322 60322 500000 114604 114604 500000
65 208315 19663 19663 500000 67950 67950 500000 187786 187786 500000
70 300680 0* 0* 0* 52180 52180 500000 297322 297322 500000
75 418564 0* 0* 0* 0* 0* 0* 484485 484485 518399
</TABLE>
* In the absence of an additional premium the Policy would lapse.
1) Assumes an annual $6000 premium is paid at the beginning of each policy year.
Values would be different if premiums with a different frequency or in different
amounts.
2) Assumes that no policy loan has been made. Excessive loans or withdrawals may
cause this policy to lapse because of insufficient cash value.
THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF RETURN MAY BE MORE OR
LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
INVESTMENT ALLOCATIONS MADE BY AN OWNER, DEATH BENEFIT OPTION SELECTED,
PREVAILING INTEREST RATES AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES OF
RETURN AVERAGED 0%, 6%, AND 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO REPRESENTATIONS
CAN BE MADE BY AVLIC OR THE FUNDS THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE
ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER ANY PERIOD OF TIME.
ENCORE! 79
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATION OF POLICY VALUES
AMERITAS VARIABLE LIFE INSURANCE COMPANY
ENDOWMENT AT AGE 100
Male Issue Age: 45 Nontobacco Preferred Underwriting Class
PLANNED PERIODIC ANNUAL PREMIUM: $20000
INITIAL SPECIFIED AMOUNT: $500000
DEATH BENEFIT OPTION: B
USING CURRENT SCHEDULE OF COST OF INSURANCE RATES
0% Hypothetical Gross 6% Hypothetical Gross 12% Hypothetical Gross
Annual Investment Return Annual Investment Return Annual Investment Return
(-1.57% Net) ( 4.43% Net) (10.43% Net)
------------------------------ --------------------------- ---------------------------
Accumulated
End Of Premiums At Accumu- Cash Accumu- Cash Accumu- Cash
Policy 5% Interest lation Surrender Death lation Surrender Death lation Surrender Death
Year Per Year Value Value Benefit Value Value Benefit Value Value Benefit
---- -------- ----- ----- ------- ----- ----- ------- ------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 21000 17702 10987 517702 18818 12103 517702 19934 13219 519934
2 43050 35007 28292 535007 38346 31631 535007 41821 35106 541821
3 66202 51918 45203 551918 58613 51898 551918 65860 59145 565860
4 90512 68439 61724 568439 79650 72935 568439 92274 85559 592274
5 116038 84573 77858 584573 101486 94771 584573 121307 114592 621307
6 142840 100325 94281 600325 124158 118114 600325 153232 147188 653232
7 170982 115692 110320 615692 147691 142319 615692 188339 182967 688339
8 200531 130684 125983 630684 172130 167429 630684 226967 222267 726967
9 231557 145298 141269 645298 197503 193474 645298 269472 265443 769472
10 264135 159534 156177 659534 223848 220490 659534 316253 312896 816253
15 453149 225060 225060 725060 371504 371504 725060 631417 631417 1131417
20 694384 280261 280261 780261 548788 548788 780261 1142035 1142035 1642035
Ages
60 453149 225060 225060 725060 371504 371504 725060 631417 631417 1131417
65 694384 280261 280261 780261 548788 548788 780261 1142035 1142035 1642035
70 1002268 322047 322047 822047 772003 772003 822047 2010178 2010178 2510178
75 1395214 338324 338324 838324 1029823 1029823 838324 3440491 3440491 3940491
</TABLE>
1) Assumes an annual $20000 premium is paid at the beginning of each policy
year. Values would be different if premiums with a different frequency or in
different amounts.
2) Assumes that no policy loan has been made. Excessive loans or withdrawals may
cause this policy to lapse because of insufficient cash value.
THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF RETURN MAY BE MORE OR
LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
INVESTMENT ALLOCATIONS MADE BY AN OWNER, DEATH BENEFIT OPTION SELECTED,
PREVAILING INTEREST RATES AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES OF
RETURN AVERAGED 0%, 6%, AND 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO REPRESENTATIONS
CAN BE MADE BY AVLIC OR THE FUNDS THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE
ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER ANY PERIOD OF TIME.
80 ENCORE!
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATION OF POLICY VALUES
AMERITAS VARIABLE LIFE INSURANCE COMPANY
ENDOWMENT AT AGE 100
Male Issue Age: 45 Nontobacco Preferred Underwriting Class
PLANNED PERIODIC ANNUAL PREMIUM: $20000
INITIAL SPECIFIED AMOUNT: $500000
DEATH BENEFIT OPTION: B
USING MAXIMUM ALLOWABLE SCHEDULE OF COST OF INSURANCE RATES
0% Hypothetical Gross 6% Hypothetical Gross 12% Hypothetical Gross
Annual Investment Return Annual Investment Return Annual Investment Return
(-2.02% Net) ( 3.98% Net) ( 9.98% Net)
----------------------------- --------------------------- ---------------------------
Accumulated
End Of Premiums At Accumu- Cash Accumu- Cash Accumu- Cash
Policy 5% Interest lation Surrender Death lation Surrender Death lation Surrender Death
Year Per Year Value Value Benefit Value Value Benefit Value Value Benefit
---- -------- ----- ----- ------- ----- ----- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 21000 17618 10903 517618 18734 12019 518734 19850 13135 519850
2 43050 34002 27287 534002 37298 30583 537298 40729 34014 540729
3 66202 49912 43197 549912 56453 49738 556453 63539 56824 563539
4 90512 65348 58633 565348 76212 69497 576212 88464 81749 588464
5 116038 80299 73584 580299 96581 89866 596581 115692 108977 615692
6 142840 94767 88723 594767 117572 111528 617572 145445 139401 645445
7 170982 108726 103354 608726 139175 133803 639175 177936 172564 677936
8 200531 122152 117451 622151 161379 156678 661379 213402 208702 713402
9 231557 135025 130996 635025 184176 180147 684176 252111 248082 752111
10 264135 147313 143956 647314 207546 204188 707546 294336 290979 794336
15 453149 199193 199193 699193 332497 332497 832497 570398 570398 1070398
20 694384 231648 231648 731648 467870 467870 967870 995731 995731 1495731
Ages
60 453149 199193 199193 699193 332497 332497 832497 570398 570398 1070398
65 694384 231648 231648 731648 467870 467870 967870 995731 995731 1495731
70 1002268 236209 236209 736209 603994 603994 1103994 1647676 1647676 2147676
75 1395214 199647 199647 699647 722919 722919 1222919 2644074 2644074 3144074
</TABLE>
1) Assumes an annual $20000 premium is paid at the beginning of each policy
year. Values would be different if premiums with a different frequency or in
different amounts.
2) Assumes that no policy loan has been made. Excessive loans or withdrawals may
cause this policy to lapse because of insufficient cash value.
THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL RATES OF RETURN MAY BE MORE OR
LESS THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
INVESTMENT ALLOCATIONS MADE BY AN OWNER, DEATH BENEFIT OPTION SELECTED,
PREVAILING INTEREST RATES AND RATES OF INFLATION. THE DEATH BENEFIT AND CASH
VALUE FOR A CONTRACT WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES OF
RETURN AVERAGED 0%, 6%, AND 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THOSE AVERAGES FOR INDIVIDUAL CONTRACT YEARS. NO REPRESENTATIONS
CAN BE MADE BY AVLIC OR THE FUNDS THAT THESE HYPOTHETICAL RATES OF RETURN CAN BE
ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER ANY PERIOD OF TIME.
ENCORE! 81
