<PAGE>
UNITED INVESTORS LIFE INSURANCE COMPANY
Advantage II Deferred Variable Annuity Policy
Supplement dated August 31, 1998 to Prospectus dated May 1, 1998
THE FOLLOWING INFORMATION SUPPLEMENTS AND SUPERSEDES ANY CONTRARY INFORMATION IN
THE ADVANTAGE II PROSPECTUS:
The name of TMK/United Funds, Inc. has been changed to "Target/United Funds,
Inc." Accordingly, the above Prospectus is amended to (1) delete "TMK/United
Funds, Inc." and (2) substitute "Target/United Funds, Inc."
Target/United Funds, Inc. has added a "Rule 12b-1" service fee. Accordingly,
the section of the above Prospectus entitled "TMK/United Funds' Annual Expenses"
is amended to (1) delete the table of expenses and expense examples, and (2)
substitute the following table of expenses, footnotes to the table of expenses,
and expense examples in their place:
<TABLE>
<CAPTION>
TARGET/UNITED FUNDS' ANNUAL EXPENSES (1)
(expressed as a percentage of net assets of the Portfolio) (2)
Management 12B-1 Other Total Portfolio
Portfolio Fees Fees (3) Expenses Expenses
- ----------------------- ---------- ------- -------- ---------------
<S> <C> <C> <C> <C>
Money Market 0.50% 0.25% 0.08% 0.83%
Bond 0.53% 0.25% 0.05% 0.83%
High Income 0.65% 0.25% 0.05% 0.95%
Growth 0.70% 0.25% 0.02% 0.97%
Income 0.70% 0.25% 0.02% 0.97%
International 0.80% 0.25% 0.18% 1.23%
Small Cap 0.85% 0.25% 0.05% 1.15%
Balanced 0.60% 0.25% 0.07% 0.92%
Limited-Term Bond 0.55% 0.25% 0.18% 0.98%
Asset Strategy 0.80% 0.25% 0.13% 1.18%
Science and Technology 0.69% 0.25% 0.25% 1.19%
</TABLE>
(1) The Target/United Funds' Annual Expenses shown above are assessed at the
underlying Portfolio level and are not direct charges against Variable
Account assets or reductions from Policy Value. These expenses are taken
into consideration in computing each underlying Portfolio's net asset value
which is the share price used to calculate the unit values of the Investment
Divisions of the Variable Account. These expenses are more fully explained
in the prospectus for the Fund. The information relating to these expenses
was provided by Waddell & Reed, Inc. and was not independently verified by
United Investors.
(2) The percentages are based on expenses incurred for the year ended December
31, 1997 except for the Science and Technology Portfolio, which is a new
portfolio, where the figures are estimates for the year ending December 31,
1998.
(3) Effective August 31, 1998, Target/United Funds, Inc. has adopted a Service
Plan (the "Plan") pursuant to Rule 12b-1 under the Investment Company Act of
1940. Under the Plan, each Portfolio may pay monthly a service fee to
Waddell & Reed, Inc., the principal underwriter of the Fund and the Policy,
in an amount not to exceed 0.25% of the Portfolio's average annual net
assets. The fee is paid to reimburse Waddell & Reed, Inc. to finance the
provision of personal services to Policyowners and maintenance of
Policyowner accounts.
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Example
If you surrender or annuitize your contract at the end of the
applicable time period, you would pay the following expenses on a $1,000
investment, assuming 5% annual return on assets:
<TABLE>
<CAPTION>
PORTFOLIO 1 Year 3 Years 5 Years 10 Years
- -------------------------------- --------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Money Market $87 $122 $159 $279
Bond $87 $122 $159 $279
High Income $88 $122 $165 $291
Growth $89 $126 $166 $293
Income $89 $126 $165 $293
International $91 $134 $179 $319
Small Cap $91 $132 $175 $311
Balanced $88 $125 $163 $288
Limited-Term Bond $89 $127 $166 $294
Asset Strategy $91 $133 $176 $314
Science and Technology $91 $133 N/A N/A
</TABLE>
If you do not surrender your contract, you would pay the following expenses
on a $1,000 investment, assuming 5% annual return on assets:
<TABLE>
<CAPTION>
PORTFOLIO 1 Year 3 Years 5 Years 10 Years
- -------------------------------- ---------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Money Market $17 $72 $129 $279
Bond $17 $72 $129 $279
High Income $19 $76 $135 $291
Growth $19 $76 $136 $293
Income $19 $76 $136 $293
International $21 $84 $149 $319
Small Cap $21 $82 $145 $311
Balanced $18 $75 $133 $288
Limited-Term Bond $19 $77 $136 $294
Asset Strategy $21 $83 $146 $314
Science and Technology $21 $83 N/A N/A
</TABLE>
The Prospectus dated May 1, 1998 for TMK/United Funds, Inc. has been amended.
Please refer to the Prospectus Supplement dated August 31, 1998 for TMK/United
Funds, Inc.
This Supplement is dated August 31, 1998.
Please keep this Supplement with your Prospectus dated May 1, 1998
for the Advantage II Deferred Variable Annuity Policy
