THE LIFE INSURANCE COMPANY OF VIRGINIA
LIFE OF VIRGINIA SEPARATE ACCOUNT III
POST SUBSTITUTION
SUPPLEMENT DATED DECEMBER 12, 1997
TO
PROSPECTUS DATED MAY 1, 1997
The Life Insurance Company of Virginia ("Life of Virginia") made the
following substitutions of shares held by investment subdivisions of Life of
Virginia Separate Account III (the "Account"):
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Before the Substitution After the Substitution
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Shares of Money Market Portfolio - Variable Shares of Money Market Fund -
Insurance Products Fund GE Investments Funds, Inc.
Shares of Money Fund - Shares of Money Market Fund - Oppenheimer
Variable Account Funds GE Investments Funds, Inc.
Shares of Government Securities Fund - Shares of Income Fund -
GE Investments Funds, Inc. GE Investments Funds, Inc.
Shares of Limited Maturity Bond Portfolio - Shares of Income Fund -
Neuberger & Berman Advisers Management Trust GE Investments Funds, Inc.
Shares of High Income Portfolio - Shares of High Income Fund -
Variable Insurance Products Fund Oppenheimer Variable Account Funds
Shares of Growth Portfolio - Shares of Growth Portfolio -
Neuberger & Berman Advisers Management Trust Variable Insurance Products Fund
Shares of Balanced Portfolio - Shares of Balanced Portfolio -
Neuberger & Berman Advisers Management Trust Janus Aspen Series
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The foregoing substitutions were carried out pursuant to an order of
the Securities and Exchange Commission issued on December 11, 1997, with the
approval of any necessary department of insurance. The effect of such a share
substitution was to replace certain portfolios of Variable Insurance Products
Fund, Oppenheimer Variable Account Funds, GE Investments Funds, Inc., and
Neuberger & Berman Advisers Management Trust with those of GE Investments Funds,
Inc., Oppenheimer Variable Account Funds, Variable Insurance Products Fund, and
Janus Aspen Series as investment options under the Policies described in your
May 1, 1997, prospectus.
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The investment objectives of the substituted funds are as follows:
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Money Market Fund - Seeks the highest level of current income as is consistent
GE Investments Funds, Inc. with high liquidity and safety of principal by investing in
various types of good quality money market securities.
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Income Fund - Seeks maximum income consistent with prudent investment
GE Investments Funds, Inc. management and preservation of capital by investing primarily
in income-bearing debt securities and other income-bearing
instruments.
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High Income Fund - Seeks a high level of current income from investment in
high Oppenheimer Variable Account Funds yield fixed income
securities, including unrated securities or high risk securities
in lower rating categories.
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Growth Portfolio - Seeks capital appreciation by normally investing in common
Variable Insurance Products Fund stocks, although its investments are not restricted to any
one type of security.
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Balanced Portfolio - Seeks long-term growth of capital, consistent with
the Janus Aspen Series preservation of capital and balanced
by current income.
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Each Policy owner affected by the substitution has been sent a written
notice informing them that the substitutions were carried out and that they may
make one transfer of all amounts under a Policy invested in any one of the
affected investment subdivisions to another investment subdivision before
January 16, 1998, without that transfer counting as the free transfer permitted
in a calendar month. Life of Virginia will not exercise any rights reserved
under any contract to impose additional restrictions on transfers relating to
the investment subdivisions until at least thirty (30) days after the
substitutions.
Because the substitution resulted in the Income Fund of GE Investments Funds,
Inc. replacing the Government Securities Fund of GE Investments Funds, Inc, all
references to the GE Investments Funds, Inc. Government Securities Fund are
hereby deleted and replaced with the GE Investments Funds, Inc. Income Fund.
The following annual expense information for the GE Investments Funds, Inc.
Income Fund is added to the FEE TABLE:
GE Investments Funds, Inc. Annual Expenses
(as a % of average net assets)
Income Fund
Management Fees (after fee waiver) .50%
Other Expenses (after any expense reimbursements) .25%
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Total Fund Annual Expenses .75%
The following is added to THE FUNDS section, GE Investments Funds, Inc.
subsection:
Income Fund has the investment objective of providing maximum income
consistent with prudent investment management and preservation of capital. The
portfolio seeks to achieve this objective by investing primarily in
income-bearing debt securities and other income-bearing instruments.
The second paragraph under the General Electric Company subsection is deleted
and the following paragraph is added in its place:
The GE family of companies also includes Capital Brokerage Corporation
(a broker-dealer registered with the Securities and Exchange Commission) which
acts as the principal underwriter for the Policies.
The following is added to the end of the second paragraph under the Dollar-Cost
Averaging subsection:
A Dollar-Cost Averaging transfer will not count toward the one free
transfer available each month or any limit on the number of transfers available
each year, except to the extent necessary for the Policy to retain its tax
status under applicable law.
The first paragraph under DISTRIBUTION OF THE POLICY is deleted and the
following paragraph is added in its place:
The Policies will be sold by individuals who, in addition to being
licensed to sell variable annuity policies for Life of Virginia, are also
registered representatives of Capital Brokerage Corporation (doing business in
Indiana and Texas as GE Capital Brokerage Corporation) the principal underwriter
of the Policies, or of broker-dealers who have entered into written sales
agreements with the principal underwriter. Capital Brokerage Corporation, an
affiliate of Life of Virginia, is a Washington corporation located at 6630 West
Broad Street, Richmond, Virginia 23230. Capital Brokerage Corporation is
registered with the Commission under the Securities Exchange Act of 1934 as a
broker-dealer and is a member of the National Association of Securities Dealers,
Inc. Capital Brokerage Corporation also serves as principal underwriter for
variable life insurance policies issued by Life of Virginia. No amounts have
been retained, however, by Capital Brokerage Corporation for acting as principal
underwriter of the Life of Virginia Policies.
This supplement should be retained with the prospectus for future
reference.
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