<PAGE> 1
PRESIDENTIAL VARIABLE ANNUITY ACCOUNT ONE
PRESIDENTIAL LIFE INSURANCE COMPANY
- --------------------------------------------------------------------------------
SUPPLEMENT TO THE PROSPECTUS DATED MAY 1, 1999
On January 5, 1999, Presidential Life Insurance Company ("Presidential
Life") and Anchor Series Trust (the "Trust") filed a Substitution Application
("Application") with the Securities and Exchange Commission ("SEC") to allow:
- Shares of the Fixed Income Portfolio to be substituted with shares of the
Government and Quality Bond Portfolio; and
- Shares of the Foreign Securities Portfolio to be substituted with shares
of the Strategic Multi-Asset Portfolio (collectively "the substitution").
Presidential Life and the Trust believe that the proposed substitution is
in the best interest of shareholders. Contract holder interest in the Fixed
Income Portfolio and the Foreign Securities Portfolio has diminished. The
resulting dwindling size of these portfolios makes it difficult for the manager
to maximize performance. Presidential Life believes that the Government and
Quality Bond Portfolio and the Strategic Multi-Asset Portfolio are appropriate
replacements because:
- The Government and Quality Bond Portfolio has a similar investment
objective to the Fixed Income Portfolio, invests in the same type of fixed
income securities and generally has better performance and lower
investment expenses; and
- The Strategic Multi-Asset Portfolio has a similar investment objective to
the Foreign Securities Portfolio, generally invests a portion of its
assets in foreign securities and in general, has better performance and a
similar expense ratio. As a result of the substitution, the expense ratio
may even decline if there is a large influx of assets.
As of the date of this Supplement, the Application has not yet been granted
by the SEC. If this Application is granted, Presidential Life will accomplish
the substitution by redeeming shares of the replaced Variable Portfolios and
simultaneously purchasing shares of the substitution Variable Portfolios at the
close of business on a selected date ("Substitution Date"). The substitution
will not cause a change in a contract holder's contract value, death benefit or
otherwise effect the variable annuity contract. Presidential Life will assume
costs and expenses associated with the substitution, including without
limitation, brokerage costs, legal, accounting and other fees and expenses.
Contract Owners invested in the Fixed Income and Foreign Securities
Variable Portfolios will be mailed a notice of the substitution within five (5)
days after the Substitution Date. For a period of thirty-one (31) days from
mailing of the notice, such contract owners may transfer all assets in the
substituted portfolio to any other available portfolio without limitation or
charge and without any such transfer counting towards the maximum free transfers
per contract year. Any transfer of funds out of one of the substitute portfolios
after that thirty-one (31) day period will be subject to the standard contract
provisions as discussed in the prospectus.
May 1, 1999
