CIGNA VARIABLE PRODUCTS GROUP, 485BPOS, 1996-04-29

CIGNA VARIABLE PRODUCTS GROUP
485BPOS, 1996-04-29

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SECURITIES ACT FILE NO. 33-20333
INVESTMENT COMPANY ACT FILE NO. 811-5480

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

___
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [___]

___
Pre-Effective Amendment No. _____ [___]

___
Post-Effective Amendment No. 13 [ X ]
----- ---
and/or
___
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [___]

___
Amendment No. 13 [ X ]
----- ---
(Check appropriate box or boxes.)

CIGNA VARIABLE PRODUCTS GROUP
(Exact Name of Registrant as Specified in Charter)

1380 Main Street, Springfield, Massachusetts 01103
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code (800) 528-6718

Alfred A. Bingham III, 1380 Main Street
Springfield, Massachusetts 01103
(Name and Address of Agent for Service)

________________________

Approximate Date of Proposed Public Offering: Continuous
----------
It is proposed that this filing will become effective (check appropriate box):

___
[___] Immediately upon filing pursuant to paragraph (b)

___
[ X ] on May 1, 1996 pursuant to paragraph (b)
---
___
[___] 60 days after filing pursuant to paragraph (a)(1)

___
[___] on (date) pursuant to paragraph (a)(1)

___
[___] 75 days after filing pursuant to paragraph (a)(2)

___
[___] on (date) pursuant to paragraph (a)(2) of rule 485.

If appropriate, check the following box:

___
[___] this post-effective amendment designates a new effective date for a

previously filed post-effective amendment.

_______________________
DECLARATION PURSUANT TO RULE 24f-2 UNDER THE INVESTMENT COMPANY ACT OF 1940

Registrant hereby declares pursuant to Rule 24f-2(a)(1) under the Investment
Company Act of 1940 that Registrant has registered an indefinite number of
shares under the Securities Act of 1933 and has paid the registration fee
appropriate thereto. The Rule 24f-2 Notice for the most recent fiscal year of
Registrant was filed electronically with the Securities and Exchange Commission
on February 29, 1996.
________________________
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

PROSPECTUS

MAY 1, 1996

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND
CIGNA VARIABLE PRODUCTS S&P 500 INDEX FUND

This prospectus contains information about the two mutual funds listed above
(the "Funds") which are separate series portfolios of CIGNA Variable Products
Group (the "Trust"), a Massachusetts business trust. Each Fund has distinct in-
vestment objectives and policies.

The investment objective of CIGNA Variable Products Money Market Fund is to
provide as high a level of current income as is consistent with the preserva-
tion of capital and liquidity and the maintenance of a stable $1.00 per share
net asset value by investing in short-term money market instruments. The in-
vestment objective of CIGNA Variable Products S&P 500 Index Fund is to provide
long-term growth of capital by investing principally in common stocks.

Shares of the Funds are available and are being marketed exclusively as pooled
funding vehicles for life insurance companies writing variable annuity con-
tracts and variable life insurance contracts ("Variable Contracts") and for
qualified retirement and pension plans ("Qualified Plans").

This prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Additional information
about the Funds, contained in a Statement of Additional Information dated May
1, 1996, has been filed with the Securities and Exchange Commission and is
available upon request without charge by writing to the Funds at 1380 Main
Street, Springfield, Massachusetts 01103. The Funds' telephone number is (860)
726-3700. The Statement of Additional Information is incorporated by reference
into this prospectus. The Statement of Additional Information is not a prospec-
tus.

- --------------------------------------------------------------------------------

Please read this prospectus and retain it for future reference.
- --------------------------------------------------------------------------------

THE SHARES OFFERED BY THIS PROSPECTUS ARE NOT FEDERALLY INSURED OR GUARANTEED
BY THE U.S. GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY. SHARES OF THE FUNDS INVOLVE INVESTMENT
RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. CIGNA VARIABLE PRODUCTS MONEY
MARKET FUND SEEKS TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE. HOW-
EVER, THERE CAN BE NO ASSURANCE THAT THE MONEY MARKET FUND WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.

- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

SUMMARY

The Trust is an open-end, diversified management investment company offering a
selection of investment vehicles for insurance companies issuing variable annu-
ity and variable life insurance contracts and for Qualified Plans. This pro-
spectus offers two Funds of the Trust. Your Variable Contract may offer one or
more of the Funds offered by this prospectus.

Each Fund has its own distinct investment objective. Although each Fund will be
managed by experienced professionals, there can be no assurance that the objec-
tive will be achieved. CIGNA Variable Products Money Market Fund seeks to ob-
tain its objective by investing in high quality, U.S. dollar denominated short-
term money market instruments. CIGNA Variable Products S&P 500 Index Fund seeks
to obtain its objective by attempting to replicate the composition and total
return, reduced by Fund expenses, of the S&P 500.

There are levels of risk involved with each Fund. Investments in money market
instruments are subject to the ability of the issuer to make payment at maturi-
ty. For equity securities, there is the market risk associated with movement of
the stock market in general. In addition, there is the financial risk related
to earnings stability and overall financial soundness of individual issuers and
of issuers collectively which are a part of a particular industry. See "Certain
Investments Strategies and Policies" for a discussion of these risks.

Shares of the Funds are sold at their net asset value per share, without sales
charge. Please read your insurance company's separate account prospectus or
your Qualified Plan's documents for discussions relating to instructions on how
to invest in and redeem from each Fund.

CIGNA Investments, Inc., the Funds' adviser, provides each Fund with investment
advice and other services. Each Fund pays CIGNA Investments, Inc. a management
fee for the management of investments and business affairs. For a discussion of
these, please see "Management of the Funds."

The investment objective of each Fund is deemed to be a fundamental policy
which may not be changed without the approval of a majority of the Fund's out-
standing shares (within the meaning of the Investment Company Act of 1940 (the
"1940 Act")). Further information is available in the Statement of Additional
Information.

The above information is qualified in its entirety by the detailed information
appearing elsewhere in this prospectus, the statement of additional informa-
tion, and, as applicable, the Variable Account prospectus or Qualified Plan
documents.
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TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SUMMARY.................................................................... 2
EXPENSE TABLE.............................................................. 3
FINANCIAL HIGHLIGHTS....................................................... 5
ABOUT THE FUNDS............................................................ 6
INVESTMENT PROGRAMS........................................................ 7
CERTAIN INVESTMENT STRATEGIES AND POLICIES................................. 9
INVESTMENT RESTRICTIONS.................................................... 12
ELIGIBLE PURCHASERS........................................................ 12
PURCHASE AND REDEMPTION OF FUND SHARES..................................... 12
COMPUTATION OF NET ASSET VALUE............................................. 13
DISTRIBUTION OF DIVIDENDS AND CAPITAL GAINS................................ 14
TAX MATTERS................................................................ 14
MANAGEMENT OF THE FUNDS.................................................... 15
PERFORMANCE................................................................ 16
THE TRUST, ITS SHARES AND BOARD OF TRUSTEES................................ 16
APPENDIX--DESCRIPTION OF MONEY MARKET INSTRUMENTS.......................... 18
</TABLE>

2
<PAGE>

EXPENSE TABLE

The following Expense Table lists the transaction expenses and approximate an-
nual operating expenses related to an investment in each of the Funds. The Ta-
ble does not reflect charges and deductions which are or may be imposed under
Variable Contracts or Qualified Plans. Please refer to the applicable Variable
Contract prospectus or Qualified Plan documents for such charges. The expenses
and fees set forth in the Table are for the fiscal year beginning January 1,
1996.

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<CAPTION>
ALL SERIES
- --------------------------------------------------------------------------------
<S> <C>
Maximum Sales Load Imposed on Purchases (as a percentage of the of-
fering price)...................................................... None
Maximum Sales Load Imposed on Reinvested Dividends (as a percentage
of the offering price)............................................. None
Deferred Sales Load (as a percentage of original purchase price or
redemption proceeds as applicable)................................. None
Redemption Fees (as a percentage of amount redeemed, if applicable). None
Exchange Fee........................................................ None
</TABLE>

ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)

<TABLE>
<CAPTION>
MONEY S&P 500
MARKET INDEX
- --------------------------------------------------------------------------------
<S> <C> <C>
Management Fees
Investment Management Fees/1/................................... .35% .25%
12b-1 Fees....................................................... None None
All Other Operating Expenses
(After Reimbursement)/1/........................................ .15% .35%
Total Fund Operating Expenses
(Reflects expense limitation. See Footnotes/1/ and/2/ below).... .50% .60%
</TABLE>
- -------
/1/For a more complete description of the Management Fees, see "Management of
the Trust." CIGNA Investments, Inc. ("CII"), the Funds' investment adviser,
has voluntarily agreed, as to each Fund, to reimburse such portion of its
management fee as is necessary to cause the Total Fund Operating Expenses of
each Fund during each calendar year not to exceed the following percentages
of each of the Fund's average daily net asset value for such year:

<TABLE>
<S> <C>
Money Market.......................................................... .50%
S&P 500 Index......................................................... .60%
</TABLE>

If this reimbursement is not sufficient to cause the Total Fund Operating Ex-
penses of any Fund not to exceed the applicable percentage of average daily
net asset value, CII has agreed to pay such other expenses of the applicable
Fund as is necessary to keep Total Fund Operating Expenses from exceeding the
applicable percentage. These arrangements will continue in effect until the
end of the fiscal year ending December 31, 1996, and afterwards to the extent
described in the Funds' then current prospectus. To the extent management
fees are reimbursed by CII, or expenses of a Fund are paid by CII, the total
return to shareholders will increase. Total return to shareholders will de-
crease to the extent management fees are no longer reimbursed or expenses of
a Fund are no longer paid.

/2/Total Fund Operating Expenses for the S&P 500 Index Fund for 1995 were .73%
of this Fund's average daily net asset value. Total Fund Operating Expenses
for the Money Market Fund for the period from March 1, 1996 (commencement of
operations) to March 31, 1996 were .08% (.94% annualized) of this Fund's av-
erage daily net asset value. The stated Operating Expense and Total Fund Op-
erating Expenses reflect the current voluntary expense limitation effective
January 1, 1996. As to the Money Market Fund, Other Operating Expenses are
based on estimated amounts for the current fiscal year. Other Operating Ex-
penses include all expenses not specifically assumed by CII.

3
<PAGE>

EXAMPLE:

The following example illustrates the expenses that you would pay on a $1,000
investment over various time periods assuming (1) a 5% annual rate of return,
and (2) redemption at the end of each time period. As noted above, the Funds
charge no redemption fees of any kind.

<TABLE>
<CAPTION>
S&P
MONEY 500
MARKET INDEX
- --------------------------------------------------------------------------------
<S> <C> <C>
1 Year............................................................. $ 5 $ 6
3 Years............................................................ $16 $19
5 Years............................................................ $-- $33
10 Years........................................................... $-- $75
</TABLE>

The purpose of the Expense Table is to assist the investor in understanding
the various costs and expenses that an investor will bear directly or indi-
rectly. For the purpose of the example, assume reinvestment of all dividends
and distributions. The Example should not be considered a representation of
past or future expenses. Actual expenses may be greater or less than those
shown. For a more complete description of the Management Fee, see "Management
of the Trust." The expense information for CIGNA Variable Products S&P 500 In-
dex Fund in the above table has been restated to reflect current voluntary ex-
pense limitations. For CIGNA Variable Products Money Market Fund, Other Oper-
ating Expenses are based on estimated amounts for the current fiscal year.

4
<PAGE>

FINANCIAL HIGHLIGHTS

The financial highlights for each of the periods identified below and included
in the financial statements of CIGNA Variable Products S&P 500 Index Fund/1/
have been examined by Price Waterhouse LLP, independent accountants, whose re-
port thereon was unqualified. The financial highlights for CIGNA Variable Prod-
ucts Money Market Fund are unaudited. The following information should be read
in conjunction with the financial statements and notes thereto available with
the Statement of Additional Information.

---------------
S&P 500 INDEX FUND
---------------

<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, begin-
ning of year........... $ 8.19 $ 9.20 $ 11.94 $ 12.83 $ 10.75 $ 11.94 $ 10.14 $ 9.41 $ 13.37 $ 13.39
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income from investment
operations
Net investment incomea.. 0.21 0.19 0.16 0.12 0.19 0.26 0.28 0.25 0.25 0.30
Net realized and
unrealized gains (loss-
es).................... 2.80 (0.13) 0.22 0.34 3.79 (0.74) 2.67 0.72 0.54 1.31
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment
operations............. 3.01 0.06 0.38 0.46 3.98 (0.48) 2.95 0.97 0.79 1.61
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less: Distributions
Dividends from net in-
vestment income........ (0.27) (0.14) (0.17) (0.12) (0.20) (0.25) (0.30) (0.24) (0.36) (0.38)
Distributions from capi-
tal gains.............. (0.18) (0.85) (2.95) (1.23) (1.70) (0.46) (0.85) -- (4.39) (1.25)
Required for tax
purposes in excess of
realized gains......... -- (0.08) -- -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions..... (0.45) (1.07) (3.12) (1.35) (1.90) (0.71) (1.15) (0.24) (4.75) (1.63)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of
year................... $ 10.75 $ 8.19 $ 9.20 $ 11.94 $ 12.83 $ 10.75 $ 11.94 $ 10.14 $ 9.41 $ 13.37
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Total return............ 36.82% 0.67% 2.97% 3.59% 37.46% -3.99% 29.22% 10.33% 3.90% 13.27%
Ratios and Supplemental
Data:
Net assets, end of pe-
riod (000)............. $66,283 $54,728 $61,478 $68,287 $73,446 $60,658 $69,389 $61,504 $70,501 $77,102
Ratio of expenses to
average net assets..... 0.73% 0.78% 0.66% 0.59% 0.56% 0.59% 0.56% 0.54% 0.51% 0.50%
Ratio of net investment
income to average net
assets................. 2.05% 2.23% 1.30% 0.94% 1.38% 2.08% 2.18% 2.16% 1.83% 2.19%
Portfolio Turnover...... 4% 4% 185%b 82% 77% 63% 55% 38% 75% 70%
</TABLE>

/a/ Net investment income per share has been calculated in accordance with SEC
requirements with the exception that end of the year accumulated
undistributed/(overdistributed) net investment income has not been adjusted
to reflect current year permanent differences between financial and tax ac-
counting.
/b/ During November 1993, the portfolio was indexed to the S&P 500, resulting in
a complete turnover of the portfolio at that time.

5
<PAGE>

FINANCIAL HIGHLIGHTS (continued)

----------------
MONEY MARKET FUND
----------------
<TABLE>
<CAPTION>
MARCH 1, 1996*-
MARCH 31, 1996
(UNAUDITED)
- -------------------------------------------------------------------------------
<S> <C>
Net asset value, beginning of period........................... $ 1.0000
--------
Income from investment operations
Net investment income.......................................... 0.0040
Net realized and unrealized gains (losses)..................... 0.0000
--------
Total from investment operations............................... 0.0040
--------
Less: Distributions
Dividends from net investment income........................... (0.0040)
Distributions from capital gains............................... 0.0000
--------
Total distributions............................................ (0.0040)
--------
Net asset value, end of period................................. $ 1.0000
========
Total return................................................... 0.40%**
Ratios and Supplemental Data:
Net assets, end of period (000)................................ $ 5,010
Ratio of expenses to average net assets........................ 0.04%***
Ratio of net investment income to average net assets........... 0.40%**
Portfolio turnover............................................. n/a
</TABLE>

* Commencement of operations.
** 4.74% annualized. Total return and ratio of net investment income to aver-
age net assets prior to the reimbursement of expenses was .36% (4.30%
annualized).
*** 0.50% annualized. Ratio of expenses to average net assets prior to reim-
bursement of expenses was 0.08% (0.94% annualized).
- -------
/1/During periods prior to November 9, 1993, the Fund was actively managed. On
November 9, 1993, the Board of Trustees authorized CIGNA Investments, Inc.,
the investment adviser to the Fund, to change the Fund's investment strat-
egy to an indexation approach. See "The Fund's Objective". Prior to October
16, 1985, the Fund was a Maryland corporation. On January 2, 1996 the name
of the Fund was changed from Companion Fund to CIGNA Variable Products S&P
500 Index Fund.

Certain additional performance and other information concerning the S & P 500
Index Fund is contained in that Fund's most recent Annual Report to Sharehold-
ers, a copy of which will be provided upon request and without charge to each
person who receives a prospectus.
ABOUT THE FUNDS
- -------------------------------------------------------------------------------
CIGNA Variable Products Money Market Fund and CIGNA Variable Products S&P 500
Index Fund are separate series of CIGNA Variable Products Group, a Massachu-
setts business trust established by a Master Trust Agreement dated February 4,
1988 and registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), as a diversified, open-end management investment company (see
"The Trust, Its Shares and Board of Trustees"). These mutual funds are re-
ferred to in this prospectus as the "Funds" and separately as a "Fund." Each
Fund has its own investment objective and policies designed to meet specific
investment goals. Each Fund intends to qualify as a regulated investment com-
pany for Federal income tax purposes. Their sole purpose is to serve as fund-
ing vehicles for the investment of monies paid by holders of Variable Con-
tracts issued through separate accounts of life insurance companies ("Life
Companies") and by Qualified Plans. The Qualified Plans and the Life Companies
may or may not make all the Funds described in this prospectus available for
investment to the Variable Contract owners or Qualified Plan participants, as
the case may be. Historically, the variable annuity contracts have been issued
by Connecticut General Life Insurance Company ("CG Life"), an indirect, whol-
ly-owned subsidiary of CIGNA Corporation. CIGNA Corporation is an insurance
and financial services holding company. The Funds may also serve as funding
vehicles for Variable Contracts issued by other life insurance companies af-
filiated with CIGNA Corporation or by life insurance companies which may be
unaffiliated with CIGNA Corporation (see "Eligible Purchasers").

6
<PAGE>

The Trust does not foresee any disadvantage to Variable Contract owners aris-
ing out of the fact that the Trust offers its shares for products offered by
Life Companies which may or may not be affiliated with each other or that it
offers its shares to Qualified Plans. Nevertheless, the Trust's Board of
Trustees intends to monitor events in order to identify any material irrecon-
cilable conflicts which may possibly arise between Variable Contract owners
and participants under Qualified Plans and to determine what action, if any,
should be taken in response thereto. If such a conflict were to occur, one or
more Life Company separate accounts or Qualified Plans might withdraw its in-
vestment in the Trust. This might force the Trust to sell portfolio securities
at disadvantageous prices.

Shares are offered only to Eligible Purchasers (see "Eligible Purchasers").
Shares are offered at net asset value without the imposition of a sales load,
sales charge or selling commission.

INVESTMENT PROGRAMS
- -------------------------------------------------------------------------------

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND
- -------------------------------------------------------------------------------
The Fund's objective is to provide as high a level of current income as is
consistent with the preservation of capital and liquidity and the maintenance
of a stable $1.00 per share net asset value by investing in short-term money
market instruments. The Fund intends to invest in money market instruments
such as U.S. Government direct obligations and U.S. Government agencies' secu-
rities. In addition, the Fund may invest in other money market instruments
such as bankers' acceptances, certificates of deposit, commercial loan partic-
ipations, repurchase agreements, time deposits and commercial paper, all of
which will be denominated in U.S. dollars. Bankers' acceptances, certificates
of deposit and time deposits may be purchased from U.S. or foreign banks. Com-
mercial paper is purchased primarily from U.S. issuers but may be purchased
from foreign issuers so long as it is denominated in U.S. dollars. All of
these instruments, including commercial loan participations, are briefly
described in "Description of Money Market Instruments" and are described more
fully in the Statement of Additional Information.

Pursuant to procedures adopted by the Board of Trustees, the Fund may purchase
only high quality securities that CII believes present minimal credit risks.
To be considered high quality, a security must be a U.S. government security
or must be rated in accordance with applicable rules in one of the two highest
categories for short-term securities by at least two nationally recognized
rating services (or by one, if only one rating service has rated the security)
or, if unrated, judged to be of equivalent quality by CII.

High quality securities are divided into "first tier" and "second tier" secu-
rities. First tier securities have received the highest rating (e.g. Standard
& Poor's Corporation's (S&P) A-1 rating) from at least two rating services (or
one, if only one has rated the security). Second tier securities have received
ratings within the two highest categories (e.g., S&P's A-1 or A-2) from at
least two rating services (or one, if only one has rated the security), but do
not qualify as first tier securities. If a security has been assigned differ-
ent ratings by different rating services, at least two rating services must
have assigned the highest rating in order for CII to determine eligibility on
the basis of that highest rating. Based on procedures adopted by the Board of
Trustees, CII may determine that an unrated security is of equivalent quality
to a rated first or second tier security.

The Fund may not invest more than 5% of its total assets in second tier secu-
rities. In addition, the Fund may not invest more than 1% of its total assets
or $1 million (whichever is greater) in the second tier securities of a single
issuer.

The Fund will generally limit its investments to securities with remaining ma-
turities of 397 days or less and will maintain a dollar-weighted average matu-
rity of 90 days or less.

CIGNA VARIABLE PRODUCTS S&P 500 INDEX FUND
- -------------------------------------------------------------------------------
The primary objective of the Fund is long-term growth of capital by investing
principally in common stocks. The Fund will seek to fulfill this objective by
attempting to replicate the composition and total return, reduced by Fund ex-
penses, of the Standard & Poor's 500 Composite Stock Price Index (the "S&P
500"). Under normal conditions, the Fund will invest

7
<PAGE>

at least 80% of its total assets in equity securities of companies which com-
pose the S&P 500. The Fund is designed as a long-term investment vehicle.

The S&P 500 includes 500 selected common stocks, most of which are listed on
the New York Stock Exchange. Each stock in the Index has a unique weighting,
depending on the number of shares outstanding and its current price.

The Fund is subject to market risk--i.e., the possibility that common stock
prices will decline over short or even extended periods. The U.S. stock market
tends to be cyclical, with periods when stock prices generally rise and peri-
ods when prices generally decline.

While the Fund seeks to match the performance of the S&P 500, its stock port-
folio performance may not match that of the S&P 500 exactly. For example, the
Fund's performance will reflect deductions for advisory fees and other ex-
penses that are not deducted from the performance figures reported for the S&P
500. In addition, while CII, the investment adviser to the Fund, generally
will seek to match the composition of the S&P 500 as closely as possible, it
may not always invest the Fund's stock portfolio to mirror the S&P 500 exact-
ly. For instance, the Fund may at times have its portfolio weighted differ-
ently from the S&P 500 because of the difficulty and expense of executing rel-
atively small stock transactions. Under normal conditions, the Fund antici-
pates holding at least 480 of the S&P 500 issues at all times.

The Fund may also invest in stock index futures contracts and related options
and in certain short-term fixed income securities (including variable and
floating rate instruments or demand instruments) such as certificates of de-
posit, commercial paper, commercial loan participations, bankers' acceptances,
U.S. Government obligations and repurchase agreements, pending investment in
common stocks of companies in the S&P 500 or to meet anticipated short-term
cash needs such as dividend payments or redemptions of shares. The percentage
of the Fund's assets invested in various types of securities will vary in
light of existing economic conditions and other factors as determined by CII.
Except in extraordinary circumstances, the Fund will not invest in short-term
fixed income securities or hold assets in cash for temporary, defensive pur-
poses.

The Fund is not sponsored, endorsed, sold or promoted by S&P. S&P makes no
representation or warranty, express or implied, to the record or beneficial
owners of shares of the Fund or any member of the public regarding the advis-
ability of investing in securities generally, or in the Fund particularly, or
the ability of the S&P 500 to track general stock market performance. S&P's
only relationship to CII or the Fund is the licensing of certain trademarks
and trade names of S&P and of the S&P 500 which is determined, composed and
calculated by S&P without regard to CII or the Fund. S&P has no obligation to
take the needs of CII or the Fund or the record or beneficial owners of the
Fund into consideration in determining, composing or calculating the S&P 500.
S&P is not responsible for and has not participated in the valuation of the
Fund or the pricing of the Fund's shares or in the determination or calcula-
tion of the equation by which the Fund's portfolio investments are to be con-
verted into cash. S&P has no obligation or liability in connection with the
administration, marketing or trading of the Fund.

S&P 500(R) is a trademark of S&P and has been licensed for use by the Fund.

S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P 500 OR
ANY DATA INCLUDED THEREIN AND S&P SHALL HAVE NO LIABILITY FOR ANY ERRORS,
OMISSIONS, OR INTERRUPTIONS THEREIN. S&P MAKES NO WARRANTY, EXPRESS OR IM-
PLIED, AS TO RESULTS TO BE OBTAINED BY CII, RECORD OR BENEFICIAL OWNERS OF THE
FUND, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE S&P 500 OR ANY DATA
INCLUDED THEREIN. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY
DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PUR-
POSE OR USE WITH RESPECT TO THE S&P 500 OR ANY DATA INCLUDED THEREIN. WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY LIABILITY FOR
ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

8
<PAGE>

PORTFOLIO TURNOVER. It is anticipated, given the S&P 500 Index Fund's policy
of attempting to replicate composition and performance, before expenses, of
the S&P 500, that portfolio turnover will be lower than that of an actively
managed fund. CIGNA Variable Products S&P 500 Index Fund's historical
portfolio turnover rates are included in the Financial Highlights table above.
A higher rate of portfolio turnover may result in higher transaction costs,
including brokerage commissions. Also, to the extent that higher portfolio
turnover results in a higher rate of net realized capital gains to a Fund, the
portion of the Fund's distributions constituting taxable capital gains may in-
crease. See "Distributions of Dividends and Capital Gains."

CERTAIN INVESTMENT STRATEGIES AND POLICIES
- -------------------------------------------------------------------------------
In pursuit of its objectives and policies, either or both of the Funds may em-
ploy one or more of the following strategies in order to enhance investment
results:

MONEY MARKET INSTRUMENTS. (BOTH FUNDS) When deemed appropriate for temporary
or defensive purposes, CIGNA Variable Products S&P 500 Fund may hold substan-
tially all of its assets in the form of cash or cash equivalent money market
instruments described in the appendix to this prospectus ("Money Market In-
struments.") However, CIGNA Variable Products S&P 500 Index Fund will only in-
vest in Money Market Instruments for temporary or defensive purposes under ex-
traordinary circumstances. In addition, CIGNA Variable Products S&P 500 Index
Fund may invest in money market instruments pending investment in common
stocks or to meet anticipated short-term cash needs. Of course, CIGNA Variable
Products Money Market Fund invests exclusively in Money Market Instruments.
Only CIGNA Variable Products Money Market Fund is required to limit such in-
vestments to those which, at the date of purchase, are "First Tier" or "Second
Tier" securities as those terms are defined in Rule 2a-7 under the 1940 Act.

SECURITIES ISSUED ON A WHEN-ISSUED OR DELAYED DELIVERY BASIS. (BOTH
FUNDS) Funds may purchase securities on a "when-issued" basis, that is, deliv-
ery of and placement for the securities is not fixed at the date of purchase,
but is set after the securities are issued (normally within forty-five days
after the date of the transaction). Funds also may purchase or sell securities
on a delayed delivery basis. The payment obligation and the interest rate that
will be received on the delayed delivery securities are fixed at the time the
buyer enters into the commitment. A Fund will only make commitments to pur-
chase when-issued or delayed delivery securities with the intention of actu-
ally acquiring such securities, but the Fund may sell these securities before
the settlement date if it is deemed advisable.

Investment in securities on a when-issued or delayed delivery basis may in-
crease a Fund's exposure to market fluctuation and may increase the possibil-
ity that the Fund will incur short-term gains subject to Federal taxation or
short-term losses if the Fund must engage in portfolio transactions in order
to honor a when-issued or delayed delivery commitment. In a delayed delivery
transaction, the Fund relies on the other party to complete the transaction.
If the transaction is not completed, the Fund may miss a price or yield con-
sidered to be advantageous. A Fund will employ techniques designed to reduce
such risks. If a Fund purchases a when-issued security, the Fund's custodian
bank will segregate cash or high grade securities in an amount equal to the
when-issued commitment. If the market value of the segregated securities de-
clines, additional cash or securities will be segregated on a daily basis so
that the market value of the segregated assets will equal the amount of the
Fund's when-issued commitments. To the extent cash and securities are segre-
gated, they will not be available for new investments or to meet redemptions.
Securities purchased on a delayed delivery basis may require a similar segre-
gation of cash or other high grade securities. For a more complete description
of when-issued securities and delayed delivery transactions see the Statement
of Additional Information.

ILLIQUID SECURITIES. CIGNA Variable Products Money Market Fund may invest up
to 10% of its net assets in securities that are illiquid. Illiquid securities
include securities that have no readily available market quotations and cannot
be disposed of promptly (within seven days) in the normal course of business
at a price at which they are valued. Illiquid securities

9
<PAGE>

may include securities that are subject to restrictions on resale because they
have not been registered under the Securities Act of 1933 (the "1933 Act").
Restricted securities may, in certain circumstances, be resold pursuant to
Rule 144A under the 1933 Act, and thus may or may not constitute illiquid se-
curities. CII determines the liquidity of each Fund's investments. Limitations
on the resale of restricted securities may have an adverse effect on their
marketability, which may prevent the Fund from disposing of them promptly at
reasonable prices. The Fund may have to bear the expense of registering such
securities for resale, and the risk of substantial delays in effecting such
registrations.

INVESTMENTS IN FOREIGN SECURITIES. (BOTH FUNDS) CIGNA Variable Products Money
Market Fund may invest up to 50% of its total assets and CIGNA Variable Prod-
ucts S&P 500 Index Fund may invest up to 25% of its total assets in Canadian
and other foreign securities, although CIGNA Variable Products Money Market
Fund may only invest in foreign securities denominated in U.S. dollars. To the
extent it invests in securities denominated in foreign currencies, a Fund
bears the risks of changes in the exchange rates between U.S. currency and the
foreign currency, as well as the availability and status of foreign securities
markets. The S&P 500 Fund may invest in securities of foreign issuers which
are in the form of American Depositary Receipts ("ADRs"), European Depositary
Receipts ("EDRs"), or other securities representing underlying securities of
foreign issuers, and such investments are treated as foreign securities for
purposes of percentage limitations on investments in foreign securities. For a
discussion of the risks pertaining to investments in foreign securities, see
"Risk Factors Regarding Foreign Securities" below.

RISK FACTORS REGARDING FOREIGN SECURITIES. (BOTH FUNDS) Investments by a Fund
in foreign securities, whether denominated in U.S. dollars or foreign curren-
cies, may entail all of the risks set forth below. Investments by a Fund in
ADRs, EDRs or similar securities also may entail some or all of the risks de-
scribed above.

CURRENCY RISK. The value of the Funds' foreign investments will be affected
by changes in currency exchange rates. The U.S. dollar value of a foreign
security decreases when the value of the U.S. dollar rises against the for-
eign currency in which the security is denominated, and increases when the
value of the U.S. dollar falls against such currency.

POLITICAL AND ECONOMIC RISK. The economies of some of the countries in
which the Funds may invest may not be as developed as the United States'
economy and may be subject to significantly different forces. Political or
social instability, expropriation or confiscatory taxation, and limitations
on the removal of funds or other assets could also adversely affect the
value of the Funds' investments.

REGULATORY RISK. Foreign companies are not registered with the Securities
and Exchange Commission and are generally not subject to the regulatory
controls imposed on United States issuers and, as a consequence, there is
generally less publicly available information about foreign securities than
is available about domestic securities. Foreign companies are not subject
to uniform accounting, auditing and financial reporting standards, prac-
tices and requirements comparable to those applicable to domestic compa-
nies. Income from foreign securities owned by the Funds may be reduced by a
withholding tax at the source, which tax would reduce dividend income pay-
able to the Funds' shareholders.

MARKET RISK. The securities markets in some of the countries in which the
Funds invest will have substantially less trading volume than the major
United States markets. As a result, the securities of some foreign compa-
nies may be less liquid and experience more price volatility than compara-
ble domestic securities. Increased custodian costs and other administrative
costs may be associated with the maintenance of assets in foreign jurisdic-
tions. There is generally less government regulation and supervision of
foreign stock exchanges, brokers and issuers which may make it difficult to
enforce contractual obligations. In addition, transaction costs in foreign
securities markets are likely to be higher, since brokerage commission
rates in foreign countries are likely to be higher than in the United
States.

10
<PAGE>

STOCK INDEX FUTURES CONTRACTS AND RELATED OPTIONS.
- --------------------------------------------------------------------------------
CIGNA Variable Products S&P 500 Index Fund may invest in stock index futures
having an aggregate face value of up to 20% of the Fund's total assets. The
Fund may do so in order to simulate full investment in the underlying S&P 500
to obtain full market exposure immediately upon receiving cash pending invest-
ment in common stocks of companies in the S&P 500 and to limit transaction
costs should invested assets need to be sold to meet redemption requests. A
futures contract on an index (such as the S&P 500) is an agreement between two
parties (buyer and seller) to take or make delivery of an amount of cash equal
to the difference between the value of the index at the close of the last trad-
ing day of the contract and the price at which the index contract was origi-
nally written. In the case of futures contracts traded on U.S. exchanges, the
exchange itself or an affiliated clearing corporation assumes the opposite side
of each transaction (i.e., as buyer or seller). A futures contract may be sat-
isfied or closed out by delivery or purchase, as the case may be, of the finan-
cial instrument or, in the case of stock index futures contracts, by payment of
the change in the cash value of the index. Frequently, using futures to effect
a particular strategy instead of using the underlying or related security or
index will result in lower transaction costs being incurred.

The Fund may also purchase and write call options and put options on futures
contracts. An option on a futures contract gives the holder the right, in re-
turn for the premium paid, to assume a long position (in the case of a call) or
a short position (in the case of a put) in a futures contract at a specified
exercise price prior to the expiration of the option. Upon exercise of a call
option, the holder acquires a long position in the futures contract and the
writer is assigned the opposite short position. In the case of a put option,
the opposite is true. An option on a futures contract generally may be closed
out (before exercise or expiration) by an offsetting purchase or sale of an op-
tion on a futures contract. See the information set forth below and the State-
ment of Additional Information for information on the risks associated with
these investments.

The Fund's use of stock index futures and options thereon will in all cases be
consistent with applicable regulatory requirements and in particular the regu-
lations of the Commodity Futures Trading Commission relating to exclusions from
regulation as a commodity pool operator. Those regulations currently provide
that the Funds may use commodity futures and option positions (i) for bona fide
hedging purposes without regard to the percentage of assets committed to margin
and option premiums, or (ii) for other purposes permitted by the entity's prin-
cipal regulator (in the case of the Funds, the Securities and Exchange Commis-
sion) to the extent that the aggregate initial margin and option premiums re-
quired to establish such non-hedging positions do not exceed 5% of the liquida-
tion value (i.e., the net asset value) of the applicable Fund's portfolio. For
further information regarding futures contracts and options thereon, see the
Statement of Additional Information.

RISK FACTORS RELATING TO FUTURES CONTRACTS AND OPTIONS. The use of futures con-
tracts and options may involve risks not associated with other types of instru-
ments which the Fund intends to purchase. In particular, the Fund's positions
in futures contracts and options may be closed out only on an exchange which
provides a liquid secondary market therefor, and there can be no assurance that
a liquid secondary market will exist for any particular futures contract or op-
tion. The inability to close out options and futures positions could have an
adverse impact on the Fund's ability to effectively hedge its securities and
might, in some cases, require a Fund to deposit cash to meet applicable margin
requirements. The Fund's ability to hedge effectively through transactions in
futures contracts or options depends on the degree to which price movements in
its holdings correlate with price movements of the futures and options. It is
possible that there may be an imperfect correlation between the hedging instru-
ment and the hedged securities, which could result in an ineffective hedge and
a loss to the Fund. It is expected that even as an index fund, the CIGNA Vari-
able Products S&P 500 Index Fund will not be able to achieve perfect correla-
tion among the Fund, the S&P 500, and stock index futures and options con-
tracts, although the correlation can be expected to be very close if the Fund
invests only in those contracts whose behavior is

11
<PAGE>

expected to resemble that of the Fund's underlying securities. See the State-
ment of Additional Information for a further description of the Funds' invest-
ments in futures contracts.

INVESTMENT RESTRICTIONS
- --------------------------------------------------------------------------------
The following summarizes the Funds' principal investment restrictions. Unless
otherwise noted, these restrictions may not be changed without the approval of
the lesser of (i) more than 50% of the outstanding shares of a Fund or (ii) 67%
or more of the shares of that Fund present at a meeting if more than 50% of the
outstanding shares of that Fund are represented at the meeting in person or by
proxy (see "The Trust, Its Shares and Board of Trustees" for a description of
the individual's rights with respect to giving voting instructions to Life Com-
panies).

Any investment restriction that involves a maximum or minimum percentage of se-
curities or assets shall not be considered to be violated unless an excess over
or a deficiency under the percentage occurs immediately after, and is caused
by, an acquisition or disposition of securities or utilization of assets by a
Fund.

A Fund may not:

1. Invest in the securities of any issuer if, immediately after such invest-
ment, more than 5% of the total assets of the Fund taken at current value would
be invested in the securities of such issuer, except (a) bank certificates of
deposit and obligations issued or guaranteed as to interest and principal by
the U.S. Government or its agencies or instrumentalities, and (b) up to 25% of
CIGNA Variable Products Money Market Fund's total assets taken at current value
may be invested without regard to such 5% limitation in bankers' acceptances in
which the Fund may invest consistent with its investment policies.

2. Acquire more than 10% of the voting securities of any issuer or more than
10% of any class of securities of any issuer. (For these purposes, all pre-
ferred stocks of any issuer are regarded as a single class, and all debt secu-
rities of an issuer are regarded as a single class.)

3. Concentrate more than 25% of its assets in any one industry, except that
CIGNA Variable Products Money Market Fund may invest up to 100% of its assets
(a) in the domestic banking industry, (b) in the personal credit institution or
business credit institution industries when, in the opinion of management,
yield differentials make such investments desirable, or (c) in any combination
of these.

4. Borrow money in excess of one-third of the value (taken at the lower of cost
or current value) of its total assets (not including the amount borrowed) at
the time the borrowing is made, and then only as a temporary measure to facili-
tate the meeting of redemption requests (not for leverage) which might other-
wise require the untimely disposition of portfolio investments or for extraor-
dinary or emergency purposes, except that CIGNA Variable Products S&P 500, Fund
may enter into stock index futures contracts, as indicated. Such borrowings
will be repaid before any additional investments are made. Interest paid on
such borrowings would reduce the yield on the Fund's investments. (The Board of
Trustees regards this restriction as setting forth the Trust's policy with re-
spect to the issuance of senior securities.)

ELIGIBLE PURCHASERS
- --------------------------------------------------------------------------------
Shares may be purchased only by Eligible Purchasers. Eligible Purchasers are
limited to: (1) those separate accounts established by CG Life or by other Life
Companies that are registered as unit investment trusts under the Investment
Company Act of 1940, as amended, and that serve as the underlying investment
vehicles for Variable Contracts; (2) Qualified Plans; and (3) Connecticut Gen-
eral Life Insurance Company (on behalf of Connecticut General Life Insurance
Company Field Individual Deferred Compensation Plan) ("CG Life Field Plan").
Thus, Eligible Purchasers who have purchased Fund shares are the only share-
holders. Shares may not be purchased by individuals or by the general public.
The Board of Trustees of the Trust may broaden or limit the definition of Eli-
gible Purchasers. Purchase of shares is subject to acceptance by the Trust and
is not binding until so accepted.

PURCHASE AND REDEMPTION OF SHARES OF THE FUNDS
- --------------------------------------------------------------------------------
Shares of the Funds are sold exclusively to and redeemed by Eligible Purchasers
on a continuous basis.

12
<PAGE>

Purchase and redemption orders received by Life Companies and Qualified Plans
on a given business day from Variable Contract owners or Qualified Plan par-
ticipants, as the case may be, will be effected at the net asset value of the
applicable Fund on such business day if the orders are received by the Fund in
proper form and in accordance with applicable requirements on the next busi-
ness day. It is each Eligible Purchaser's responsibility to properly transmit
purchase and redemption orders and payments in accordance with applicable re-
quirements. Individuals may not place orders directly with the Funds. The
Funds do not issue share certificates. Please refer to the prospectus of your
Life Company's separate account or Qualified Plan documents for information on
how to invest in each Fund.

Investments by Eligible Purchasers in each Fund are expressed in terms of full
and fractional shares of each Fund. All investments in the Funds are credited
to an Eligible Purchaser's account immediately upon acceptance of the invest-
ment by a Fund.

The offering of shares of any Fund may be suspended for a period of time and
each Fund reserves the right to reject any specific purchase order. Purchase
orders may be refused if, in CII's opinion, they are of a size that would dis-
rupt the management of a Fund.

COMPUTATION OF NET ASSET VALUE
- -------------------------------------------------------------------------------
State Street determines the net asset value of shares of each of the Funds as
of the close of business on the New York Stock Exchange ("NYSE") on each day
the NYSE is open for trading and on any other day on which there is a suffi-
cient degree of trading in a Fund's investments that the current net asset
value of its shares might be materially affected. The NYSE is closed on New
Year's Day, President's Day, Good Friday, Martin Luther King Day, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. The
computation of net asset value is made by dividing each Fund's total net as-
sets by the number of outstanding shares of such Fund at the time of calcula-
tion. Net assets are the excess of a Fund's assets over its liabilities. Eq-
uity securities, including warrants, that are listed on a national securities
exchange or that are part of the NASDAQ National Markets system are valued at
the last sale price or, if there has been no sale that day, at the last bid
price. Debt and other equity securities actively traded in the over-the-
counter market, including listed securities whose primary markets are believed
to be over-the-counter, are valued at the most recent bid price, which may be
based upon valuations furnished by a pricing service or from independent secu-
rities dealers. Short-term investments with remaining maturities of up to and
including 60 days are valued at amortized cost which approximates market val-
ue. Except in the case of CIGNA Variable Products Money Market Fund, short-
term investments that mature in more than 60 days are valued at current market
quotations. Other securities and assets of a Fund, with the exception of
futures contracts which are discussed below, are appraised at fair value as
determined in good faith by, or under the authority of, the Board of Trustees
of the Trust. The net asset value so computed applies to all purchase orders
and redemption requests in the hands of State Street, duly executed in accor-
dance with applicable instructions, on the day of such determination. Any or-
ders received after such time are executed at the net asset value next deter-
mined.

FUTURES CONTRACTS
- -------------------------------------------------------------------------------
Initial margin deposits made upon entering into futures contracts are recog-
nized as assets due from the broker (the Fund's agent in acquiring the futures
position). During the period the futures contract is open, changes in the
value of the contract are recognized as unrealized gains or losses by "mark-
ing-to-market" on a daily basis to reflect the market value of the contract at
the end of each day's trading. Variation margin payments are made or received,
depending upon whether unrealized losses or gains are incurred. When the con-
tract is closed, the Fund records a realized gain or loss equal to the differ-
ence between the proceeds from (or cost of) the closing transaction and the
Fund's basis in the contract.

OPTIONS ON FUTURES CONTRACTS
- -------------------------------------------------------------------------------
The premium paid by a Fund for the purchase of a call or put option on futures
contracts is recorded as an investment and subsequently "marked-to-market" to
reflect the current market value of the option purchased. The current market
value of a purchased op-

13
<PAGE>

tion on futures contracts is the last reported sale price or, if no sales are
reported, the last bid price. If an option on futures contracts which a Fund
has purchased expires on the stipulated expiration date, the Fund realizes a
loss in the amount of the cost of the option. If a Fund exercises a purchased
put option on futures contracts, it realizes a gain or loss from the sale of
the underlying security and the proceeds from such sale will be decreased by
the premium originally paid. If a Fund exercises a purchased call option on
futures contracts, the cost of the security which the Fund purchases upon ex-
ercise will be increased by the premium originally paid.

VALUATION OF MONEY MARKET INVESTMENTS (CIGNA VARIABLE PRODUCTS MONEY MARKET
FUND)
- -------------------------------------------------------------------------------
Money market investments are valued at amortized cost, which approximates mar-
ket value, in accordance with rules adopted by the Securities and Exchange
Commission. Using the amortized cost valuation method allows CIGNA Variable
Products Money Market Fund to maintain its net asset value at $1.00 per share.
There is no assurance that this method will always be used, or if used, that
the net asset value under certain conditions will not deviate from $1.00 per
share. If the Board of Trustees deems it inadvisable to continue the practice
of maintaining the net asset value of $1.00 per share they may alter this pro-
cedure. The shareholders of the Fund will be notified prior to any such
change, unless such change is only temporary, in which case the shareholders
will be notified after the change. See the Statement of Additional Information
for more information on amortized cost procedures.

DISTRIBUTION OF DIVIDENDS AND CAPITAL GAINS
- -------------------------------------------------------------------------------
It is expected that shares of the Funds will be held under the terms of Vari-
able Contracts or Qualified Plans. Under current tax law, dividends or capital
gain distributions from any Fund are not currently taxable when left to accu-
mulate within a Variable Contract or Qualified Plans. Depending on the Vari-
able Contract or Qualified Plan, withdrawals from the contracts may be subject
to ordinary income tax and, in addition, to a 10% penalty tax on withdrawals
before age 59 1/2.

Each Fund is treated as a separate entity for federal income tax purposes.
Each Fund intends to pay out all of its net investment income and net realized
capital gains for each year. Dividends and net realized capital gains, if any,
from the Funds will be distributed at least annually (except that dividends
are declared and paid daily in the case of the CIGNA Variable Products Money
Market Fund). After distribution from a Fund (other than the Money Market
Fund), the Fund's share price drops by the amount of the distribution. Because
dividends and capital gain distributions are reinvested in shares of the Fund
paying the dividend or distribution, the total value of a shareholder's ac-
count will not be affected because, although the shares will have a lower
price, there will be correspondingly more of them.

TAX MATTERS
- -------------------------------------------------------------------------------
Each Fund intends to qualify as a regulated investment company under the In-
ternal Revenue Code of 1986, as amended (the "Code"), and intends to take all
other action required to ensure that no Federal income taxes will be payable
by the Funds. As a result, each Fund will generally seek to distribute annu-
ally to Shareholders most or all of its undistributed taxable income and any
undistributed net realized capital gains (after use of any available capital
loss carry forwards). Because of this policy, the Funds do not anticipate be-
ing subject to the 4% excise tax imposed on the undistributed income of mutual
funds.

The Trust was established as the underlying investment for Variable Contracts
issued by the Life Companies. (See "About the Funds")

Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of Variable Contracts held in the Funds. The Code provides
that a Variable Contract shall not be treated as an annuity contract or life
insurance for any period (and any subsequent period) for which the investments
of the underlying Fund are not, in accordance with regulations prescribed by
the Treasury Department, adequately diversified. Disqualification of the Vari-
able Contract as an annuity contract or life insurance would result in imposi-
tion of federal income tax on contract owners with respect to earnings alloca-
ble to the Variable

14
<PAGE>

Contract prior to the receipt of payments under the Variable Contract. Section
817(h)(2) of the Code is a safe harbor provision which provides that contracts
such as the Variable Contracts meet the diversification requirements if, as of
the close of each quarter, the underlying Fund assets meet the diversification
standards for a regulated investment company and no more than fifty-five per-
cent (55%) of the total assets consists of cash, cash items, U.S. Government
securities and securities of other regulated investment companies. There is an
exception for securities issued by the Treasury Department in connection with
variable life insurance policies.

On March 2, 1989, the Treasury Department issued Regulations (Treas. Reg.
1.817-5), which established diversification requirements for the investment
portfolios underlying Variable Contracts. The Regulations amplify the diversi-
fication requirements for Variable Contracts set forth in Section 817(h) of
the Code and provide an alternative to the safe harbor provision described
above. Under the Regulations, an investment portfolio will be deemed ade-
quately diversified if (i) no more than 55 percent of the value of the total
assets of the portfolio is represented by any one investment; (ii) no more
than 70 percent of such value is represented by any two investments; (iii) no
more than 80 percent of such value is represented by any three investments;
and (iv) no more than 90 percent of such value is represented by any four in-
vestments. For purposes of these Regulations all securities of the same issuer
are treated as a single investment.

The Code provides that for purposes of determining whether or not the diversi-
fication standards imposed on the underlying assets of Variable Contracts by
Section 817(h) of the Code have been met, "each United States government
agency or instrumentality shall be treated as a separate issuer."

As indicated elsewhere in this prospectus, Fund shares are also offered for
sale to Qualified Plans. The Regulations also provide that satisfaction of the
requirements of the Regulations shall not be prevented by reason of the fact
that shares in the investment company (i.e., a Fund) may be held by the
trustee of a qualified pension or other retirement plan (i.e., Qualified
Plan).

Each Fund will be managed in such manner as to comply with these diversifica-
tion requirements. It is possible that in order to comply with the diversifi-
cation requirements, less desirable investment decisions may be made which
would affect the investment performance of the Fund.

MANAGEMENT OF THE FUNDS
- -------------------------------------------------------------------------------
The investment adviser to each of the Funds is CIGNA Investments, Inc.
("CII"), an indirect, wholly-owned subsidiary of CIGNA Corporation. CII also
serves as investment adviser for other investment companies including invest-
ment companies sponsored by affiliates of CIGNA Corporation, and for a number
of pension, advisory, corporate and other accounts. CII and other affiliates
of CIGNA Corporation manage combined assets of approximately $70 billion.
CII's mailing address is 900 Cottage Grove Road, Hartford, Connecticut 06152.

Pursuant to a Master Investment Advisory Agreement the Trust, on behalf of the
Funds, employs CII to manage the investment and reinvestment of the assets of
the Funds. Subject to the control and periodic review of the Board of Trust-
ees, CII determines what investments shall be purchased, held, sold or ex-
changed by the Funds and what portion, if any, of the assets of the Funds
shall be held in cash and other temporary investments. CII is also responsible
for overall management of the business affairs of the Trust and the Funds.

As full compensation for the investment management and all other services ren-
dered by CII and any sub-adviser, each Fund pays CII a separate fee computed
daily and paid monthly at annual rates based on a percentage of the value of
the relevant Fund's average daily net assets, as follows: CIGNA Variable Prod-
ucts S&P 500 Index Fund--0.25% and CIGNA Variable Products Money Market Fund--
0.35%.

Each Fund will bear its own expenses. Operating expenses for each Fund gener-
ally consist of investment management fees, custodian fees, fees for necessary
professional and brokerage services, costs of regulatory compliance, costs as-
sociated with maintaining legal existence and all other costs not specifically
borne by CII. Trust-wide expenses not identifiable to

15
<PAGE>

any particular Fund will be allocated among the Funds. CII has agreed to reim-
burse the Funds to the extent that the annual operating expenses in any one
year (excluding interest, taxes, amortized organizational expense, transaction
costs in acquiring and disposing of portfolio securities and extraordinary ex-
penses) of a Fund exceed a percentage of the value of the relevant Fund's aver-
age daily net assets, as follows: CIGNA Variable Products S&P 500 Index Fund--
0.60% and CIGNA Variable Products Money Market Fund--0.50%.

The investment management fee payable in 1995 to CII by CIGNA Variable Products
S&P 500 Index Fund (then known as Companion Fund) was 0.35% of average daily
net assets, and total expenses of this Fund in 1995 were 0.73% of average daily
net assets.

CII investment personnel may invest in securities for their own account pursu-
ant to a code of ethics that establishes procedures for personal investing and
restricts certain transactions.

State Street Bank and Trust Company ("State Street"), Boston, Massachusetts
02105 serves as transfer agent and dividend disbursing agent for the Funds.
State Street is also custodian of the assets of the Funds.

From time to time, the Funds may pay brokerage commissions on portfolio trans-
actions to brokers who may be deemed to be affiliates of CIGNA Corporation un-
der the 1940 Act, as amended. See the Statement of Additional Information for
further details.

PERFORMANCE
- --------------------------------------------------------------------------------
Each Fund's performance may be quoted in advertising in terms of yield and to-
tal return if accompanied by performance of your Life Company's separate ac-
count. Performance is based on historical results and not intended to indicate
future performance. For additional performance information, contact your Life
Company for a free annual report.

CIGNA Variable Products Money Market Fund's yield refers to the income gener-
ated by an investment in the Fund over a specified seven day period, expressed
as an annual percentage rate. Its effective yield is calculated similarly, but
assumes that the income earned from investments is reinvested. The Money Market
Fund's effective yield will tend to be slightly higher than its yield because
of this compounding effect. For CIGNA Variable Products S&P 500 Index Fund,
Yield refers to the income generated by an investment in the Fund over a speci-
fied 30-day (or one month) period, expressed as an annual percentage rate.

Total returns are based on the overall dollar or percentage change in value of
a hypothetical investment in each Fund, including changes in share price (ex-
cept for the Money Market Fund) and assuming each Fund's dividends and capital
gain distributions, if any, are reinvested. A cumulative total return reflects
a Fund's performance over a stated period of time. An average annual total re-
turn reflects the hypothetical annually compounded return that would have pro-
duced the same cumulative total return if a Fund's performance had been con-
stant over the entire period. Because average annual returns tend to smooth out
variations in a Fund's return, you should recognize that they are not the same
as actual year-by-year results. To illustrate the components of overall perfor-
mance, a Fund may separate its cumulative and average annual returns into in-
come results and capital gain or loss.

Yields and total returns quoted for the Funds include the effect of deducting
each Fund's expenses, but may not include charges and expenses attributable to
any particular Variable Contract or Qualified Plan. Since shares of the Funds
may only be purchased by Eligible Purchasers, you should carefully review the
prospectus of the Variable Contract you have chosen or Qualified Plan documents
for information on relevant charges and expenses. Excluding these charges from
quotations of each Fund's performance has the effect of increasing the perfor-
mance quoted. You should bear in mind the effect of these charges when compar-
ing a Fund's performance to that of other funds.

THE TRUST, ITS SHARES AND BOARD OF TRUSTEES
- --------------------------------------------------------------------------------
On April 26, 1988, the shareholders of Companion Fund, a series of shares of
CIGNA Annuity Funds

16
<PAGE>

Group, approved an Agreement and Plan of Reorganization and Liquidation (the
"Plan") whereby, upon the effective date of the Plan, Companion Fund would be-
come a series of the Trust (such series to be known as Companion Fund) and
shareholders of Companion Fund, the series of shares of CIGNA Annuity Funds
Group, would become shareholders of Companion Fund, a series of shares of the
Trust, in a tax-free exchange of shares. The Plan became effective on April
26, 1988. Companion Fund is now known as CIGNA Variable Products S&P 500 Index
Fund. The Trust currently consists of five separately managed Funds, two of
which are offered by this prospectus. Additional Funds were added to the Trust
by an amendment to the Trust's registration statement having an effective date
of January 2, 1996. The Board of Trustees is authorized in the Master Trust
Agreement to create new series of shares without the necessity of a vote of
shareholders of the Trust. The capitalization of the Trust consists solely of
an unlimited number of shares of beneficial interest with a par value of
$0.001 each.

Under the Master Trust Agreement no annual or regular meetings of shareholders
are required. Meetings of shareholders of a series will be held from time to
time to consider matters requiring a vote of such shareholders in accordance
with the requirements of the 1940 Act, state law or the provisions of the Mas-
ter Trust Agreement. It is not expected that shareholder meetings will be held
annually.

Except as otherwise provided under the 1940 Act, the Board of Trustees will be
a self-perpetuating body until fewer than two thirds of the Trustees serving
as such are Trustees who were elected by shareholders of the Trust. In the
event less than a majority of the Trustees serving as such were elected by
shareholders of the Trust, a meeting of shareholders will be called to elect
Trustees. Under the Master Trust Agreement, any Trustee may be removed by vote
of two thirds of the outstanding Trust shares; holders of 10% or more of the
outstanding shares of the Trust can require that the Trustees call a meeting
of shareholders for purposes of voting on the removal of one or more Trustees.

Shares of the Trust may be owned by the CG Life Field Plan, by separate ac-
counts of the Life Companies or by the Qualified Plans (see "About the Funds"
and "Eligible Purchasers"). Pursuant to current interpretations of the 1940
Act, the Life Companies will solicit voting instructions from contract owners
with respect to any matters that are presented to a vote of shareholders. With
respect to the Qualified Plans, the trustees of such Plans will vote the
shares held by the Qualified Plans, except that in certain cases such shares
may be voted by a named fiduciary or an investment manager pursuant to the Em-
ployee Retirement Income Security Act of 1974. There is no pass-through voting
to the participants in the Qualified Plans.

Shares of each Fund will entitle their holders to one vote per share (with
proportionate voting for fractional shares), irrespective of the relative net
asset value of the shares of any Fund. On any matter submitted to a vote of
shareholders, all shares of the Trust then issued and outstanding shall be
voted in the aggregate. However, on matters affecting an individual Fund, a
separate vote of shareholders of that Fund would be required. Shareholders of
a Fund would not be entitled to vote on any matter which does not affect that
Fund but which would require a separate vote of another Fund.

When issued, shares of a Fund are fully paid and nonassessable, and have no
preemptive or subscription rights. There are no conversion rights. Shares do
not have cumulative voting rights, which means that in situations in which
shareholders elect Trustees, holders of more than 50% of the shares voting for
the election of Trustees can elect 100% of the Trustees of the Trust and the
holders of less than 50% of the shares voting for the election of Trustees
will not be able to elect any Trustees.

Under Massachusetts law, the shareholders of the Trust could, under certain
circumstances, be held personally liable for the obligations of the Trust.
However, the Master Trust Agreement disclaims shareholder liability for acts
or obligations of the Trust and requires that notice of such disclaimer be
given in each agreement, obligation or instrument entered into or executed on
behalf of the Trust. The Master Trust Agreement provides for indemnification
from the Trust property for all losses and expenses of any share-

17
<PAGE>

holder held personally liable for the obligations of the Trust. Thus, the risk
of a shareholder incurring financial loss on account of shareholder liability
is limited to circumstances in which the Trust itself would be unable to meet
its obligations.

A majority of the Trustees is not affiliated with CIGNA Corporation or any of
its subsidiary companies. The Trustees meet quarterly to review the results of
the Funds, to monitor investment activities and practices, and to review and
act upon future plans for the Funds. The role of the Trustees is not to approve
specific investment purchases and sales, but rather to exercise a control and
review function.

APPENDIX
- --------------------------------------------------------------------------------

DESCRIPTION OF MONEY MARKET INSTRUMENTS
- --------------------------------------------------------------------------------
U.S. GOVERNMENT DIRECT OBLIGATIONS--Bills, notes, and bonds issued by the U.S.
Treasury.

U.S. GOVERNMENT AGENCIES SECURITIES--Certain Federal agencies such as the Gov-
ernment National Mortgage Association have been established as instrumentali-
ties of the U.S. Government to supervise and finance certain types of activi-
ties. Issues of these agencies, while not direct obligations of the U.S. Gov-
ernment, are either backed by the full faith and credit of the United States or
are guaranteed by the Treasury or supported by the issuing agencies' right to
borrow from the Treasury.

BANKERS' ACCEPTANCES--A bill of exchange or time draft drawn on and accepted by
a commercial bank. It is used by corporations to finance the shipment and stor-
age of goods and to furnish dollar exchange. Maturities are generally six
months or less.

CERTIFICATES OF DEPOSIT--A negotiable interest-bearing instrument with a spe-
cific maturity. Certificates of deposit are issued by banks and savings and
loan institutions in exchange for the deposit of funds and normally can be
traded in the secondary market, prior to maturity.

TIME DEPOSITS--A non-negotiable receipt issued by a bank in exchange for the
deposit of funds. Like a certificate of deposit, it earns a specified rate of
interest over a definite period of time; however, it cannot be traded in the
secondary market.

COMMERCIAL PAPER--The term used to designate unsecured short-term promissory
notes issued by corporations and other entities. Maturities on these issues
vary from a few days to nine months.

COMMERCIAL LOAN PARTICIPATIONS--Participating interests in loans made by a
bank, or a syndicate of banks represented by an agent bank, to corporate bor-
rowers. Loan participations may extend for the entire term of the loan or may
extend only for short "strips" that correspond to stated payments on the under-
lying loan. The loans underlying such participations may be secured or
unsecured, and a Fund may invest in loans collateralized by mortgages on real
property. Each Fund will limit its investments in commercial loan participa-
tions to those which are considered by the Trustees (with the advice of CII) to
be of comparable quality to permitted commercial paper investments.

REPURCHASE AGREEMENTS--A repurchase agreement is a contractual undertaking
whereby the seller of securities (limited to U.S. Government securities, in-
cluding securities issued or guaranteed by the U.S. Treasury or the various
agencies and instrumentalities of the U.S. Government) agrees to repurchase the
securities at a specified price on a future date determined by negotiations.
The repurchase agreement may be considered a loan by a Fund to the issuer of
the agreement, a bank or securities dealer, with the U.S. Government security
serving as collateral for the loan.

VARIABLE AND FLOATING RATE INSTRUMENTS--Certain instruments issued, guaranteed
or sponsored by the U.S. Government or its agencies, state and local government
issuers, and certain debt instruments issued by domestic banks or corporations,
may carry variable or floating rates of interest. Such instruments bear inter-
est at rates which are not fixed, but which vary with changes in specified mar-
ket rates or indices, such as a Federal Reserve composite index.

18
<PAGE>

Custodian and Transfer Agent:
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110

Investment Adviser:
CIGNA Investments, Inc.
900 Cottage Grove Road
Hartford, Connecticut 06152

Independent Accountants:
Price Waterhouse LLP
160 Federal Street
Boston, Massachusetts 02110

[RECYCLED PAPER LOGO APPEARS HERE] Printed on recycled paper

CIGNA VARIABLE PRODUCTS
GROUP

PROSPECTUS

MAY 1, 1996

<PAGE>

C I G N A V A R I A B L E P R O D U C T S G R O U P
-------------------------------------------------------

S T A T E M E N T O F A D D I T I O N A L I N F O R M A T I O N

M A Y 1, 1 9 9 6

================================================================================

This Statement of Additional Information is not a prospectus, but should be read
in conjunction with the prospectus for CIGNA Variable Products Group, (CIGNA
Variable Products Money Market Fund and CIGNA Variable Products S&P 500 Index
Fund) (collectively the "Funds" and each separately as a "Fund")), having the
same date as the date of this Statement of Additional Information. Much of the
information contained in this Statement of Additional Information expands upon
subjects discussed in the prospectus. No investment in shares of any of the
Funds should be made without first reading the prospectus for the Funds. A copy
of the prospectus for the Funds may be obtained from CIGNA Variable Products
Group at 1380 Main Street, Springfield, MA 01103.

The financial statements for CIGNA Variable Products Group for fiscal year ended
December 31, 1995, as contained in the Annual Report to Shareholders dated
December 31, 1995, are hereby incorporated by reference into this Statement of
Additional Information. The financial statements for the fiscal year ended
December 31, 1995 have been examined by Price Waterhouse LLP, independent
accountants, whose report thereon also is incorporated herein by reference.

The financial statements for CIGNA Variable Products Money Market Fund for the
period from March 1, 1996 through March 31,1996 are attached to this Statement
of Additional Information.

The financial statements of the Funds will be delivered with this Statement of
Additional Information.
<PAGE>

TABLE OF CONTENTS
-----------------
Page
----
General Information About the Funds......................... 3
-----------------------------------

Investment Objectives and Policies.......................... 4
----------------------------------

Futures Contracts.......................................... 15
-----------------

Options on Futures Contracts............................... 16
----------------------------

Risks as to Futures Contracts and Related Options.......... 17
-------------------------------------------------

Investment Restrictions.................................... 20
-----------------------

Tax Matters................................................ 23
-----------

Activities Of Affiliated Companies......................... 26
----------------------------------

Control Persons and Principal Holders of Securities........ 26
---------------------------------------------------

Management of the Funds.................................... 26
-----------------------

Investment Advisory and Other Services..................... 29
--------------------------------------

Portfolio Turnover and Brokerage Allocation................ 31
-------------------------------------------

Performance Information.................................... 33
-----------------------

Purchase, Redemption and Pricing of Securities............. 35
----------------------------------------------

Dividends.................................................. 37
---------

Limitation on Transfers.................................... 37
-----------------------

Ratings of Securities...................................... 37
---------------------

2
<PAGE>

GENERAL INFORMATION ABOUT THE FUNDS
-----------------------------------

The Trust has five separate series portfolios or Funds:

CIGNA Variable Products High Yield Fund
CIGNA Variable Products Income Fund
CIGNA Variable Products International Stock Fund
CIGNA Variable Products Money Market Fund
CIGNA Variable Products S&P 500 Index Fund.

Prior to January 2, 1996 the sole series of the Trust was CIGNA Variable
Products S&P Index Fund, which was formerly known as Companion Fund. The
four other funds referred to above were added to the Trust on January 2,
1996.

Prior to November 9, 1993, Companion Fund sought to fulfill its investment
objective through an active management strategy, investing primarily in
common stocks of established medium to large-size companies selected by
CIGNA Investments, Inc. ("CII"), its investment adviser, as having prospects
for above-average earnings growth. On that date, at the request of
Connecticut General Life Insurance Company ("CG Life") (which on its own
behalf and through its separate accounts was the Fund's sole shareholder),
the Board of Trustees of the Trust authorized CII to change Companion Fund's
investment strategy to the indexation approach described in the prospectus.

CIGNA Variable Products Group is registered under the Investment Company Act
of 1940, as amended, as a diversified, open-end management investment
company, and was organized as a Massachusetts business trust pursuant to a
Master Trust Agreement dated February 4, 1988. On April 26, 1988, the Trust
acquired the assets and liabilities of Companion Fund, a series of shares of
CIGNA Annuity Funds Group. As mentioned above, Companion Fund is now known
as CIGNA Variable Products S&P 500 Index Fund. Under the Master Trust
Agreement, the Board of Trustees is authorized to create new series of
shares without the necessity of a vote of shareholders of the Trust.

Each Fund is a separate series of the Trust. The assets received by the
Trust from the issue or sale of shares of each of the Funds, and all income,
earnings, profits and proceeds thereof, are specifically allocated to the
appropriate Fund, subject only to the rights of creditors. They constitute
the underlying assets of each of Fund, are required to be segregated on the
books of account, and are to be charged with the expenses in respect to such
Fund. Any general expenses of the Trust not readily identifiable as
belonging to a particular Fund shall be allocated by or under the direction
of the Board of Trustees in such manner as the Board determines to be fair
and equitable.

Each share of each Fund represents an equal, proportionate interest in that
Fund with each other share and is entitled to such dividends and
distributions out of the income belonging to such Fund as are declared by
the Board. Upon any liquidation of the Trust, shareholders of a Fund are
entitled to share pro rata in the net assets belonging to such Fund
available for distribution.

3
<PAGE>

INVESTMENT OBJECTIVES AND POLICIES
----------------------------------

The following information supplements the material contained in the
prospectus regarding each Fund's investment objectives and policies.

Description of Money Market Instruments
---------------------------------------

U.S. GOVERNMENT DIRECT OBLIGATIONS--issued by the U.S. Treasury and include
bills, notes, and bonds.

. Treasury bills are issued with maturities of up to one year.
They are issued in bearer form, are sold on a discount basis
and are payable at par value at maturity.

. Treasury notes are longer-term interest bearing obligations
with original maturities of one to ten years.

. Treasury bonds are longer-term interest bearing obligations
with original maturities from ten to thirty years.

U.S. GOVERNMENT AGENCIES SECURITIES--Certain Federal agencies have been
established as instrumentalities of the U.S. Government to supervise and
finance certain types of activities. These agencies include the Bank for
Cooperatives, Federal Land Banks, Federal Intermediate Credit Banks, Federal
Home Loan Banks, Federal National Mortgage Association, Government National
Mortgage Association, Export-Import Bank, and Tennessee Valley Authority.
Issues of these agencies, while not direct obligations of the U.S.
Government, are either backed by the full faith and credit of the United
States or are guaranteed by the Treasury or supported by the issuing
agencies' right to borrow from the Treasury. There can be no assurance that
the U.S. Government itself will pay interest and principal on securities as
to which it is not legally obligated to do so.

BANKERS' ACCEPTANCES--A banker's acceptance is a bill of exchange or time
draft drawn on and accepted by a commercial bank. It is used by
corporations to finance the shipment and storage of goods and to furnish
dollar exchange. When the draft is accepted by a bank, the bank guarantees
to pay the face value of the instrument on its maturity date. An investor
can purchase a banker's acceptance in the secondary market at the going rate
of discount for a specific maturity. In addition to purchasing bankers'
acceptances from domestic branches and foreign branches of U.S. commercial
banks, bankers' acceptances denominated in each case in U.S. dollars, may be
purchased from foreign branches and U.S. branches of foreign banks having at
least one billion dollars (U.S.) of assets. Maturities are generally six
months or less.

CERTIFICATES OF DEPOSIT--A certificate of deposit ("CD") is a negotiable
interest-bearing instrument with a specific maturity. Certificates of
deposit are issued by banks and savings and loan institutions in exchange
for the deposit of funds and normally can be traded in the secondary market,
prior to maturity. Each Fund may invest in U.S. dollar denominated CD's
issued by domestic branches and foreign branches of U.S. banks which are
members of the Federal Reserve System; by foreign branches and U.S. branches
of foreign

4
<PAGE>

banks and by U.S. domiciled savings and loan institutions having in each
case at least one billion dollars (U.S.) of assets. CD's issued by foreign
branches of U.S. banks are called "Eurodollar CD's" while CD's issued by
U.S. branches of foreign banks are called "Yankee CD's."

COMMERCIAL LOAN PARTICIPATIONS--Each Fund will limit its investments in loan
participations to those which are considered by the Fund's adviser, CIGNA
Investments, Inc. ("CII") to be of comparable quality to permitted
commercial paper investments. These ratings are described under "Ratings of
Securities." Further, for the purposes of each Fund's investment
restrictions, each loan participation will be treated as an obligation of
both the originating bank (or agent bank in the case of loans originated by
a syndicate of banks) and the corporate borrower. In addition, each Fund
may only invest up to 5% of the value of its total assets in loan
participations.

Loan participations in which a Fund may invest may vary in legal structure.
Occasionally, lenders assign to another institution both the lenders's
rights and obligations under a credit agreement. Since this type of
assignment relieves the original lender of its obligations, it is called a
novation. Such novations are relatively rare since they typically require
the consent of the borrower. More typically, a lender assigns only its
right to receive payments of principal and interest under a promissory note,
credit agreement or similar document. A true assignment shifts to the
assignee the direct debtor-creditor relationship with the underlying
borrower. Alternatively, a lender may assign only part of its rights to
receive payments pursuant to the underlying instrument or loan agreement.
Such partial assignments, which are more accurately characterized as
"participating interests," do not shift the debtor-creditor relationship to
the assignee, who must rely on the original lending institution to collect
sums due and to otherwise enforce its rights against the agent bank which
administers the loan or against the underlying borrower. An active
secondary market for particular loan participations may not develop, which
would result in a substantial restriction on a Fund's ability to liquidate
such participations prior to maturity.

REPURCHASE AGREEMENTS--Each Fund may engage in repurchase agreement
transactions in pursuit of its investment objective. Under the terms of a
typical repurchase agreement, a Fund purchases an underlying U.S. Government
security, including securities issued or guaranteed by the U.S. Treasury or
agencies and instrumentalities of the U.S. Government, for a relatively
short period (most likely overnight and usually not more than five days)
subject to an obligation of the seller to repurchase, and the Fund to
resell, the security at an agreed upon price and time, thereby determining
the yield during the Fund's holding period. The arrangement results in a
fixed rate of return that is not subject to market fluctuations during the
Fund's holding period. The Funds may enter into repurchase agreements with
banks having $1 billion or more of assets and with broker/dealers having net
capital of $100 million or more. The Funds require that the counter-party's
obligation under repurchase agreements be sufficiently collateralized so
that the value of the underlying collateral securities at least equals the
amount of the repurchase agreement. Also, the Funds require that the
underlying securities be

5
<PAGE>

held by the custodian of Fund assets, either physically or under the Federal
Book Entry System.

Repurchase agreements could involve certain risks in the event of default or
insolvency of the repurchasing bank or broker/dealer, including possible
delays or restrictions upon a Fund's ability to dispose of the underlying
securities. CII, in accordance with procedures adopted by the Board of
Trustees of the Trust, monitors and evaluates the credit-worthiness of banks
and dealers with which the Funds engage in repurchase agreements.

TIME DEPOSITS--A time deposit is a non-negotiable receipt issued by a bank
in exchange for the deposit of funds. Like a certificate of deposit, it
earns a specified rate of interest over a definite period of time; however,
it cannot be traded in the secondary market. U.S. dollar denominated time
deposits may be purchased from domestic branches and foreign branches of
U.S. banks which are members of the Federal Reserve System (not including
savings and loan institutions) and from foreign branches and U.S. branches
of foreign banks having at least one billion dollars (U.S.) of assets.

U.S. dollar denominated certificates of deposit, time deposits and bankers'
acceptances issued by foreign branches of U.S. banks or by foreign banks
either in the U.S. or abroad may present investment risks in addition to the
risks involved in investments in obligations of, or guaranteed by, domestic
banks. Such risks include future political and economic developments, the
possible imposition of withholding taxes on interest income payable on such
obligations, the possible seizure or nationalization of foreign deposits,
the possible establishment of exchange controls or the adoption of other
governmental restrictions. Generally, foreign branches of U.S. banks and
U.S. branches of foreign banks are subject to fewer U.S. regulatory
restrictions than are applicable to domestic banks, and foreign branches of
U.S. banks may be subject to less stringent reserve requirements than
domestic banks. U.S. branches of foreign banks and foreign branches of U.S.
banks may provide less public information than, and may not be subject to
the same accounting, auditing and financial record-keeping standards as,
domestic banks. Foreign branches of foreign banks generally would not be
subject to any U.S. regulatory restrictions or disclosure, financial
recordkeeping or accounting requirements.

COMMERCIAL PAPER--Commercial paper is the term used to designate unsecured
short-term promissory notes issued by corporations and other business
entities. Maturities on these issues vary from a few days to nine months.
Commercial paper may be purchased from U.S. domiciled issuers. Commercial
paper may also be purchased from foreign issuers issued either in the U.S.
("Yankee" commercial paper) or abroad if, in any case, such paper is
denominated in U.S. dollars.

OTHER CORPORATE OBLIGATIONS--Each Fund may purchase notes, bonds and
debentures issued by corporations and other business entities. However,
CIGNA Variable Products Money Market Fund will purchase such obligations
only if at the time of purchase there are 397 days or less remaining until
maturity or if they carry a variable or floating rate of interest.

6
<PAGE>

VARIABLE AND FLOATING RATE INSTRUMENTS--Certain instruments issued,
guaranteed or sponsored by the U.S. Government or its agencies, or state and
local government issuers, and certain debt instruments issued by domestic
banks or corporations or other business entities, may carry variable or
floating rates of interest. Such instruments bear interest at rates which
are not fixed, but which vary with changes in specified market rates or
indices, such as a Federal Reserve composite index.

CIGNA Variable Products Money Market Fund may invest in variable and
floating rate instruments even if they carry stated maturities in excess of
397 days, upon certain conditions contained in a rule of the Securities and
Exchange Commission, but will do so only if there is a secondary market for
such instruments or if they carry demand features permitting them to be
redeemed upon notice of seven (7) days or less at par, or both.

CIGNA Variable Products Money Market Fund will not invest in variable amount
master demand notes. A Fund's right to obtain payment at par on a demand
instrument upon demand could be affected by events occurring between the
date a Fund elects to redeem the instrument and the date redemption proceeds
are due which affect the ability of the issuer to pay the instrument at par
value. CII will monitor on an ongoing basis the earning power, cash flow
and other liquidity ratios of the issuers of such instruments, and will
similarly monitor the ability of an issuer of a demand instrument to pay
principal and interest on demand.

Description of Income Instruments for CIGNA Variable Products High Yield
------------------------------------------------------------------------
Fund
----

As noted in the prospectus, the Fund purchases principally debt securities
that are rated Ba or lower by Moody's or BB or lower by S&P.

Included among the high-yield, high risk securities in which the Fund may
invest are securities issued in connection with corporate restructurings
such as takeovers or leveraged buyouts. Securities issued to finance
corporate restructurings may have special credit risks due to the highly
leveraged conditions of the issuer. In addition, such issuers may lose
experienced management as a result of the restructuring. Also, the market
price of such securities may be more volatile to the extent that expected
benefits from the restructuring do not materialize.

Because investors generally perceive that there are greater risks associated
with the medium to lower rated securities of the type constituting high-
yield, high risk securities, the yields and prices of such securities may
tend to fluctuate more than those for higher rated securities. In the lower
quality segments of the fixed income securities market, changes in
perceptions of issuer's creditworthiness tend to occur more frequently and
in a more pronounced manner than do such changes with respect to higher
quality segments of the fixed income securities market, causing greater
yield and price volatility. Commissions and underwriting spreads associated
with the purchase of high-yield, high risk bonds are typically higher than
those associated with the purchase of high grade bonds.

7
<PAGE>

The Fund may also invest in preferred stocks with yields that are
attractive, provided that such investments are otherwise consistent with the
investment objective and policies of the fund. A preferred stock is an
equity security that entitles the holders to a priority in liquidation over
holders of the issuer's common stock. In liquidation, the holders of
preferred stock are subordinate to the holders of the issuer's debt
obligations. Typically, preferred stocks include the right to receive
regular dividend payments and may also include conversion rights, put and
call obligations and other features. In determining whether to invest in
any particular stock, CII will consider all relevant factors, including the
dividend yield, its conversion features, if any, its liquidity, and the
overall financial condition of the issuer. Under normal circumstances, the
Fund will not invest more than 10% of its assets in preferred stock.

The Fund may invest up to 15% of its total assets in "private placements,"
i.e., securities that are subject to restrictions on resale because they
have not been registered under the securities Act of 1933, as amended (the
"1933 Act"). Privately placed securities, which include securities eligible
for resale under Rule 144A under the 1933 Act, ordinarily can be sold by the
Fund in privately negotiated transactions to a limited number and/or
particular type of purchases or in a public offering made pursuant to an
effective registration statement under the 1933 act. Private or public
sales of such securities by the Fund are likely to involve delays and
expenses. Private sales require negotiation with one or more purchasers and
may produce less favorable prices than the sale of similar unrestricted
securities. Public sales generally involve the time and expense of the
preparation and processing of a registration statement under the 1933 Act
(and the possible decline in value of the securities during such period) and
may involve the payment of underwriting commissions. For these reasons,
restricted securities are less liquid than registered securities and certain
restricted securities may be illiquid. The lack of third party evaluation
of the credit quality of these securities and the possibility of a less
liquid secondary market because of restrictions placed by some investors
with respect to the purchase of non-rated securities may also increase the
risk to investors.

The Fund will not acquire common stocks, except when (i) attached to or
included in a unit with income-generating securities that otherwise would be
attractive to the Fund; (ii) acquired through the exercise of equity
features accompanying convertible securities held by the Fund, such as
conversion or exchange privileges or warrants for the acquisition of stock
or equity interest of the same or different issuer; or (iii) in the case of
an exchange offering whereby the equity security would be acquired with the
intention of exchanging it for a debt security issued on a "when-issued"
basis.

Description of Income Instruments for CIGNA Variable Products Income Fund
-------------------------------------------------------------------------

In pursuing its investment objective, the assets of CIGNA Variable Products
Income Fund will be principally invested in the following types of interest-
bearing securities:

8
<PAGE>

(1) Marketable debt securities that are rated at the time of purchase
within the four highest grades assigned by Moody's Investors
Service, Inc. (Aaa, Aa, A or Baa) or Standard & Poor's Corporation
(AAA, AA, A or BBB); see "Ratings of Securities."

(2) U.S. Government securities, as described below.

(3) Obligations of, or guaranteed by, U.S. banks or bank holding
companies, which obligations are considered by CII to have
investment qualities comparable to securities which may be purchased
under Item (1) above, although there can be no assurance that said
obligations shall have such qualities.

(4) Money market instruments eligible for purchase by CIGNA Variable
Products Money Market Fund, which instruments are considered by CII
to have investment qualities comparable to securities which may be
purchased under Item (1) above, although there can be no assurance
that said obligations shall have such qualities.

(5) Marketable securities (payable in U.S. dollars) of, or guaranteed
by, the Government of Canada or of a Province of Canada or any
instrumentality or political subdivision thereof.

The balance of CIGNA Variable Products Income Fund's assets may be invested
in other fixed-income securities, including straight debt and convertible
debt securities and preferred stock. Investment positions may be held in
common stock and similar equity securities (including warrants or rights to
purchase equity investments as described below) when they are acquired as
parts of units with fixed-income securities or upon exercise of such
warrants or rights or upon the conversion of such securities. CIGNA
Variable Products Income Fund also may purchase and sell interest rate
futures contracts and purchase options on futures contracts as described
under "Futures Contracts" and "Options on Futures Contracts."

U.S. Government securities include a variety of securities that are issued
or guaranteed by the U.S. Treasury, by various agencies of the U.S.
Treasury, by various agencies of the U.S. Government or by various
instrumentalities that have been established or sponsored by the U.S.
Government. Treasury securities include Treasury bills, Treasury notes and
Treasury bonds. Treasury bills have a maturity of one year or less;
Treasury notes have maturities of one to ten years; Treasury bonds generally
have a maturity of greater than ten years. The Federal agencies established
as instrumentalities of the U.S. Government to supervise and finance certain
types of activities include the Federal Home Loan Banks, the Government
National Mortgage Association, the Federal National Mortgage Association,
the Federal Land Banks, the Small Business Administration, the Export-Import
Bank, the Federal Intermediate Credit Banks and the Bank for Cooperatives.

U.S. Government securities may take the form of participation interests in,
and may be evidenced by, deposit or safekeeping receipts. Participation
interests are pro rata interests in U.S. Government securities such as
interests in pools of mortgages sold by

9
<PAGE>

the Government National Mortgage Association; instruments evidencing deposit
or safekeeping are documentary receipts for such original securities held in
custody by others. The Fund will not invest in obligations of the Asian
Development Bank, the Inter-American Development Bank or the International
Bank for Reconstruction and Development (World Bank).

U.S. Government obligations, including those that are guaranteed by Federal
agencies or instrumentalities, may or may not be backed by the "full faith
and credit" of the United States. Some securities issued by Federal
agencies or instrumentalities are only supported by the credit of the agency
or instrumentality (such as the Federal Home Loan Banks) while others have
an additional line of credit with the U.S. Treasury (such as the Federal
National Mortgage Association). Certain securities issued by Federal
agencies or instrumentalities backed by the full faith and credit of the
U.S. Government include those issued by the Government National Mortgage
Association and the Small Business Administration. In the case of
securities not backed by the full faith and credit of the United States, the
Fund must look principally to the agency issuing or guaranteeing the
obligation for ultimate repayment and may not be able to assert a claim
against the United States itself in the event the agency or instrumentality
does not meet its commitments.

Warrants are, in effect, longer term call options. They give the holder the
right to purchase a given number of shares of a particular company at
specified prices within certain periods of time. The purchaser of a warrant
expects that the market price of the security will exceed the purchase price
of the warrant plus its exercise price, thus resulting in a profit.
However, since the market price may never exceed the exercise price before
the expiration date of the warrant, the purchaser of the warrant risks the
loss of the entire purchase price of the warrant.

Warrants generally trade in the open market and may be sold rather than
exercised. Warrants are sometimes sold in unit form with other securities
of an issuer. Units of warrants and common stock may be employed in
financing unseasoned companies. The purchase price varies with the
security, the life of the warrant and various other investment factors.
Investments in warrants, valued at the lower of cost or market, may not
exceed 5% of the value of the Fund's net assets.

CIGNA Variable Products High Yield Fund and CIGNA Variable Products Income
--------------------------------------------------------------------------
Fund: Risk Factors
-------------------

CIGNA Variable Products High Yield Fund, and, to a lesser extent, CIGNA
Variable Products Income Fund, invest in debt securities of less than
investment grade (i.e., securities rated Ba/BB or below by Moody's and S&P).
Such securities are often referred to as high yield or junk bonds and are
typically considered "high risk" securities. High yield bonds may be subject
to certain risk factors to which other securities are not subject to the
same degree. An economic downturn tends to disrupt the market for high yield
bonds and adversely effect their values. Such an economic downturn may be
expected to result in increased price volatility of

10
<PAGE>

high yield bonds and of the value of the Fund's shares, and an increase in
issuers' defaults on such bonds.

Also, issuers of high yield bonds are substantially leveraged, which may
impair their ability to meet their obligations. In some cases, the
securities in which the Fund invests are subordinated to the prior payment
of senior indebtedness, thus potentially limiting the Fund's ability to
recover full principal or to receive payments when senior securities are in
default. When the secondary market for high yield bonds becomes
increasingly illiquid, or in the absence of readily available market
quotations for high yield bonds, the relative lack of reliable, objective
data makes the responsibility of the Trustees to value the Fund's securities
more difficult, and judgement plays a greater role in the valuation of
portfolio securities. Also, increased illiquidity of the high yield bond
market may affect the Fund's ability to dispose of portfolio securities at a
desirable price.

The credit rating of a security does not necessarily address its market
value risk. Also, ratings may from time to time, be changed to reflect
developments in the issuer's financial condition. High yield bonds have
speculative characteristics which are apt to increase in number and
significance with each lower rating category. Also, prices of high yield
bonds have been found to be less sensitive to interest rate changes and more
sensitive to adverse economic changes and individual corporate developments
than more highly rated investments.

Certain laws or regulations may have a material effect on the Fund's net
asset value and investment practices. For example, legislation requiring
federally-insured savings and loan associations to divest their investments
in high yield bonds may further adversely affect the market for such bonds.

Characteristics of CIGNA Variable Products S&P 500 Index Fund
-------------------------------------------------------------

CIGNA Variable Products S&P 500 Index Fund seeks long-term growth of capital
by investing primarily in common stocks. Realization of current income is
an incidental consideration, although it is hoped that growth in income will
accompany growth in capital. The portfolio of the Fund normally will
consist primarily of equity securities of companies which compose the S&P
500.

The Fund also may invest in certain short-term fixed income securities,
stock index futures and options on futures, as more fully described in the
prospectus under "CIGNA Variable Products S&P 500 Index Fund."

Characteristics of CIGNA Variable Products Income Fund
------------------------------------------------------

Considerations of liquidity and preservation of capital mean that CIGNA
Variable Products Income Fund may not necessarily invest in instruments
paying the highest available yield at a particular time. This Fund may,
consistent with its investment objective, attempt to maximize yields by
buying and selling portfolio investments in anticipation of or in response
to changing economic and money market conditions and trends. This Fund will
also invest to take advantage of what are believed to be temporary
disparities in the yields of the

11
<PAGE>

different segments of the market or among particular instruments within the
same segment of the market. These policies, as well as the relatively short
maturity of obligations to be held by this Fund, may result in frequent
changes in portfolio holdings. There usually are no brokerage commissions
as such paid in connection with the purchase of securities of the type in
which this Fund may invest. See "Brokerage Allocation" for a discussion of
underwriters' commissions and dealers' spreads involved in the purchase and
sale of portfolio securities.

Changes in interest rates are likely to result in increases or decreases in
the value of the investments of CIGNA Variable Products Income Fund. The
value of the securities in this Fund can be expected to vary inversely with
the changes in prevailing interest rates. Thus, depending upon whether
interest rates have increased or decreased since the time a security was
purchased, such security, if sold, might be sold at a loss or a gain. If
debt instruments are held to maturity, no gain or loss would normally be
realized as a result of interest rate fluctuations.

Characteristics of CIGNA Variable Products International Stock Fund
-------------------------------------------------------------------

The Fund will invest in securities listed on foreign securities exchanges or
securities traded in the over-the-counter market. Debt securities will be
acquired in new offerings or in principal trades with broker/dealers.
Ordinarily, the Fund will not purchase securities with the intention of
engaging in short-term trading. However, any particular security will be
sold, and the proceeds reinvested, whenever such action is deemed prudent
from the viewpoint of the Fund's investment objective, regardless of the
holding period of that security. The rating applied to a debt security or
money market instrument (see "Ratings of Securities" below) at the time the
security is purchased by the Fund may be changed while the Fund holds such
security in its portfolio. This change may affect, but may not compel, a
decision to dispose of a security. Nonetheless, the Fund does not intend to
hold more than 5% of its net assets in bonds rated below investment grade
(i.e. bonds rated BB or Ba or below by S&P or Moody's or if not so rated,
which in the opinion of CIGNA International Investment Advisors, Ltd.
("CIIA"), sub-adviser to the Fund, are of comparable quality). Therefore,
the Fund will dispose of any bond, as soon as practicable consistent with
achieving an orderly disposition, that would cause the Fund to violate the
above-referenced limitation. If the major rating services used by the Fund
were to alter their standards or systems for rating, the Fund would then
employ ratings under the revised standards or systems that would be
comparable to those specified in its current investment objective, policies
and restrictions.

Characteristics of CIGNA Variable Products Money Market Fund
------------------------------------------------------------

The types of money market instruments in which the Fund presently invests
are listed under "Description of Money Market Instruments" in the prospectus
and this statement of additional information. If the Trustees determine
that it may be advantageous to invest in other types of money market
instruments the Fund may invest in such instruments, if it is permitted to
do so by its investment objective, policies and restrictions.

12
<PAGE>

As discussed in the prospectus, the Money Market Fund may invest in U.S.
dollar-denominated obligations of U.S. and foreign depository institutions,
including commercial and savings banks and savings and loan associations.
The obligations may be issued by U.S. or foreign depository institutions,
foreign branches or subsidiaries of U.S. depository institutions
("Eurodollar" obligations), U.S. branches or subsidiaries of foreign
depository institutions ("Yankeedollar" obligations) or foreign branches or
subsidiaries of foreign depository institutions. Obligations of foreign
depository institutions, their branches and subsidiaries, and Eurodollar and
Yankeedollar obligations may involve additional investment risks to the
risks of obligations of U.S. institutions. Such investment risk include
adverse political and economic developments, the possible imposition of
withholding taxes on interest income payable on such obligations, the
possible seizure or nationalization of foreign deposits and the possible
establishment of exchange controls or other foreign governmental laws or
restrictions which might adversely affect the payment of principal and
interest. Generally, the issuers of such obligations are subject to fewer
regulatory requirements than are applicable to U.S. banks. Foreign
depository institutions, their branches or subsidiaries, and foreign
branches or subsidiaries of U.S. banks may be subject to less stringent
reserve requirements than U.S. banks. U.S. branches or subsidiaries of
foreign banks are subject to the reserve requirements of the state in which
they are located. There may be less publicly available information about a
foreign bank or a branch or subsidiary of a foreign bank than about a U.S.
institution, and such branches or subsidiaries may not be subject to the
same accounting, auditing and financial record keeping standards and
requirements as U.S. banks. Evidence of ownership of foreign depository and
Eurodollar obligations may be held outside of the United States and the Fund
may be subject to the risks associated with the holding of such property
overseas. Foreign depository and Eurodollar obligations of the Fund held
overseas will be held by foreign branches of the custodian for the Funds
portfolio securities or by other U.S. or foreign banks under subcustodian
arrangements complying with the requirements of the Investment Company Act
of 1940, as amended (the "1940 Act"). CII will consider the above factors
in making investments in foreign depository, Eurodollar and Yankeedollar
obligations and will not knowingly purchase obligations which, at the time
of purchase, are subject to exchange controls or withholding taxes.
Generally, the Fund will limit its foreign depository and Yankeedollar
investments to obligations of banks organized in Canada, France, Germany,
Japan, the Netherlands, Switzerland, the United Kingdom and other western
industrialized nations. As discussed in the prospectus, the Fund may also
invest in U.S. dollar-denominated commercial paper and other short-term
obligations issued by foreign entities. Such investments are subject to
quality standards similar to those applicable to investments in comparable
obligations of domestic issuers. Investments in foreign entities in general
involve the same risks as those described above in connection with
investments in Eurodollar and Yankeedollar obligations and obligations of
foreign depository institutions and their foreign branches and subsidiaries.

The Money Market Fund's investments in short-term corporate debt and bank
money instruments will be rated, or will be issued by issuers who have been
rated, in one of the two highest rating categories for

13
<PAGE>

short-term debt obligations by a nationally recognized statistical rating
organization (an "NRSRO") or, if not rated, will be of comparable quality as
determined by the Trustees of the Trust. The Money Market Fund's
investments in corporate bonds and debentures (which must have maturities at
the date of purchase of 397 days (13 months) or less) will be in issuers who
have received from an NRSRO a rating with respect to a class of short-term
debt obligations that is comparable in priority and security with the
investment in one of the two highest rating categories for short-term
obligations or if not rated, will be of comparable quality as determined by
the Trustees of the Trust. Currently, there are six NRSROs: Duff and
Phelps Inc., Fitch Investors Services, Inc., IBCA Limited and its affiliate
IBCA Inc., Thompson BankWatch, Inc., Moody's Investors Service Inc. and
Standard & Poor's Rating Group. See "Appendix--Description of Money Market
Instruments".

The rating applied to a security at the time the security is purchased by
the Fund may be changed while the Fund holds such security in its portfolio.
This change may affect, but will not necessarily compel, a decision to
dispose of a security. If the major rating services used by the Fund were
to alter their standards or systems for rating, the Fund would then employ
ratings under the revised standards or systems that would be comparable to
those specified in its current investment objective, policies and
restrictions.

The Board of Trustees has established procedures in compliance with Rule 2a-
7 under the 1940 Act that include reviews of portfolio holdings by the
Trustees at such intervals as they may deem appropriate to determine whether
net asset value, calculated by using available market quotations, deviates
from $1.00 per share and, if so, whether such deviation may result in
material dilution or is otherwise unfair to existing shareholders. In the
event the Trustees determine that a deviation having such a result exists,
they intend to take such corrective action as they deem necessary and
appropriate, including the sale of portfolio instruments prior to maturity
in order to realize capital gains or losses or to shorten average portfolio
maturity; withholding dividends; or establishing a net asset value per share
by using available market quotations; in which case, the net asset value
could possibly be greater or less than $1.00 per share. If the Trustees
deem it inadvisable to continue the practice of maintaining the net asset
value at $1.00 per share, they may alter this procedure. The shareholders
of the Fund will be notified promptly after any such change.

Any increase in the value of a shareholder's investment in the Fund
resulting from the reinvestment of dividend income is reflected by an
increase in the number of shares in the shareholder's account.

Matters relating to all Funds
-----------------------------

Except as described under "Investment Restrictions," the foregoing
investment characteristics are not fundamental and the Board of Trustees may
change such policies without shareholder approval. The Board will not
change a Fund's investment objectives without the required shareholder vote
as set forth in "Investment Restrictions" below. There is risk inherent in
any investment, and there is no assurance that any of the strategies and
methods of investment

14
<PAGE>

available to any Fund will result in the achievement of its objectives.

FUTURES CONTRACTS
-----------------

(Stock Index Futures Contracts - CIGNA Variable Products S&P 500 Index Fund
---------------------------------------------------------------------------
and CIGNA Variable Products International Stock fund ("Equity Funds") and
--------------------------------------------------------------------------
Interest Rate Futures Contracts - CIGNA Variable Products Income Fund and
-------------------------------------------------------------------------
CIGNA Variable Products High Yield Fund ("Debt Funds")
------------------------------------------------------

A stock index assigns relative values to the common stocks included in the
index and the index fluctuates with changes in the market values of the
common stocks so included. A stock index futures contract is a bilateral
agreement pursuant to which two parties agree to take or make delivery of an
amount of cash equal to a specified dollar amount times the difference
between the stock index value at the close of the last trading day of the
contract and the price at which the futures contract is originally struck.
No physical delivery of the underlying stocks in the index is made.
Currently, stock index futures contracts can be purchased or sold primarily
with respect to broad based stock indices such as the Standard & Poor's 500
Stock Index, the New York Stock Exchange Composite Index, the American Stock
Exchange Major Market Index, the NASDAQ - 100 Stock Index the Value Line
Stock Index, the Nikkei 225 Stock Average, the Topix, the FT-SE100, the
Major Market Index, the Matif Stock Index and the Australia All Ordinairies.

CIGNA Variable Products International Stock Fund will only enter into stock
index futures contracts as a hedge against changes resulting from market
conditions in the values of the securities held or which the Fund intends to
purchase. When the Fund anticipates a significant market or market sector
advance, the purchase of a stock index futures contract affords a hedge
against not participating in such advance. Conversely, in anticipation of
or in a general market or market sector decline that adversely affects the
market values of the Fund's portfolio of securities, the Fund may sell stock
index futures contracts. CIGNA Variable Products Group S&P 500 Index Fund's
use of stock index futures is discussed in the prospectus.

An interest rate futures contract is an agreement between two parties to buy
and sell a debt security for a set price on a future date. Currently, there
are futures contracts based on a variety of financial instruments including
long-term U.S. Treasury bonds, U.S. Treasury notes, U.S. Treasury bills,
Eurodollars, the Japanese 10 Year Bond, the German 10 Year Bond, the
Australian 10 Year Bond, London InterBank Offer Rate, Sterling, Long Gilt
and the Bond Buyer Municipal Bond Index.

The Debt Funds and CIGNA Variable Products International Stock Fund may
enter into interest rate futures contracts for the purpose of hedging debt
securities in their portfolios or the value of debt securities which the
Funds intend to purchase. For example, if one of these Funds owned long-
term debt securities and interest rates were expected to increase, they
might sell interest rate futures contracts. If, on the other hand, these
Funds held cash reserves and interest rates were expected to decline, they
might purchase interest rate futures contracts.

15
<PAGE>

In cases of purchases of futures contracts, an amount of cash and cash
equivalents, equal to the market value of the futures contracts (less any
related margin deposits), will be deposited in a segregated account with the
Trust's Custodian to collateralize the position and ensure that the use of
such futures contracts is unleveraged. Unlike when a Fund purchases or
sells a security, no price is paid or received by a Fund upon the purchase
or sale of a futures contract. Initially, a Fund will be required to
deposit with the custodian for the Fund for the account of the broker a
stated amount, as called for by a particular contract, of cash or U.S.
Treasury bills. This amount is known as "initial margin." The nature of
initial margin in futures transactions is different from that of margin in
securities transactions in that futures contract margin does not involve the
borrowing of funds by the customer to finance the transactions.

Rather, the initial margin is in the nature of a performance bond or good
faith deposit on the contract which is returned to the applicable Fund upon
termination of the futures contract assuming all contractual obligations
have been satisfied. Subsequent payments, called "variation margin," to and
from the broker will be made on a daily basis as the price of the futures
contract fluctuates making the long and short positions in the futures
contract more or less valuable, a process known as "marking-to-market." For
example, when an Equity Fund has purchased a stock index futures contract
and the price of the underlying stock index has risen, that position will
have increased in value and the Fund will receive from the broker a
variation margin payment with respect to that increase in value.
Conversely, where an Equity Fund purchases a stock index futures contract
and the price of the underlying stock index has declined, the position would
be less valuable and the Fund would be required to make a variation margin
payment to the broker. Variation margin payments would be made in a similar
fashion when a Fund purchases an interest rate futures contract. At any
time prior to expiration of the futures contract, a Fund may elect to close
the position by taking an opposite position which will operate to terminate
the Fund's position in the futures contract. A final determination of
variation margin is then made, additional cash is required to be paid by or
released to the Fund and the Fund realizes a loss or a gain.

OPTIONS ON FUTURES CONTRACTS (Equity Funds/Debt Funds)
------------------------------------------------------

An option on a futures contract gives the purchaser (the Fund) the right, in
return for the premium paid, to assume a position in a futures contract (a
long position if the option is a call and a short position if the option is
a put) at a specified exercise price at any time during the option exercise
period. The writer of the option is required upon exercise to assume an
offsetting futures position (a short position if the option is a call and a
long position if the option is a put) at a specified exercise price at any
time during the period of the option. Upon exercise of the option, the
assumption of offsetting futures positions by the writer and holder of the
option will be accompanied by delivery of the accumulated cash balance in
the writer's futures margin account which represents the amount by which the
market price of the futures contract, at exercise, exceeds, in the case of a
call, or is less than, in the case of a put, the exercise price of the
option on the futures contract. If an option on a futures contract is
exercised on the last trading date prior to the

16
<PAGE>

expiration date of the option, the settlement will be made entirely in cash
equal to the difference between the exercise price of the option and the
closing price of the futures contract on the expiration date.

CIGNA Variable Products S&P 500 Index Fund's use of options on futures
contracts is discussed in the prospectus. The other Funds may purchase put
options on futures contracts to hedge against the risk of falling prices for
their portfolio securities, and may purchase call options on futures
contracts as a hedge against a rise in the price of securities which they
intend to purchase. Options on futures contracts may also be used to hedge
the risks of changes in the exchange rate of foreign currencies. The
purchase of a put option on a futures contract is similar to the purchase of
protective put options on portfolio securities or a foreign currency. The
purchase of a call option on a futures contract is similar in some respects
to the purchase of a call option on an individual security or a foreign
currency. Depending on the pricing of the option compared to either the
price of the futures contract upon which it is based or the price of the
underlying securities or currency, it may or may not be less risky than
ownership of the futures contract or underlying securities or currency.

RISKS AS TO FUTURES CONTRACTS AND RELATED OPTIONS
-------------------------------------------------

There are several risks in connection with the use of futures contracts and
related options as hedging devices. One risk arises because of the
imperfect correlation between movements in the price of hedging instruments
and movements in the price of the stock, debt securities or foreign currency
which are the subject of the hedge. If the price of a hedging instrument
moves less than the price of the stocks, debt securities or foreign currency
which are the subject of the hedge, the hedge will not be fully effective.
If the price of a hedging instrument moves more than the price of the stock,
debt securities or foreign currency, a Fund will experience either a loss or
a gain on the hedging instrument which will not be completely offset by
movements in the price of the stock, debt securities or foreign currency
which are the subject of the hedge. The use of options on futures contracts
involves the additional risk that changes in the value of the underlying
futures contract will not be fully reflected in the value of the option.

Successful use of hedging instruments by a Fund is also subject to CII's
ability to predict correctly movements in the direction of the stock market
(Equity Funds), of interest rates (Debt Funds) or of foreign exchange rates
(foreign currencies). Because of possible price distortions in the futures
and options markets and because of the imperfect correlation between
movements in the prices of hedging instruments and the investments being
hedged, even a correct forecast by CII of general market trends may not
result in a completely successful hedging transaction.

It is also possible that where a Fund has sold futures contracts to hedge
its portfolio against a decline in the market, the market may advance and
the value of stocks or debt securities held in a Fund's portfolio may
decline. If this occurred, a Fund would lose money on the futures contracts
and also experience a decline in the value of

17
<PAGE>

its portfolio securities. Similar risks exist with respect to foreign
currency hedges.

Positions in futures contracts or options may be closed out only on an
Exchange on which such contracts are traded. Although the Funds intend to
purchase or sell futures contracts or purchase options only on Exchanges or
Boards of Trade where there appears to be an active market, there is no
assurance that a liquid market on an Exchange or Board of Trade will exist
for any particular contract or at any particular time. If there is not a
liquid market at a particular time, it may not be possible to close a
futures position or purchase an option at such time. In the event of
adverse price movements under those circumstances, a Fund would continue to
be required to make daily cash payments of maintenance margin on its futures
positions. The extent to which the Fund may engage in futures contracts or
related options will be limited by Internal Revenue Code requirements for
qualification as a regulated investment company and the Fund's intent to
continue to qualify as such. The result of a hedging program cannot be
foreseen and may cause the portfolio of the Fund to suffer losses which it
would not otherwise sustain.

Foreign Currency Transactions (All Funds Except CIGNA Variable Products
-----------------------------------------------------------------------
Money Market Fund)
------------------

The Funds may engage in currency exchange transactions to protect against
uncertainty in the level of future currency exchange rates.

Generally, Funds may engage in both "transaction hedging" and "position
hedging". When a Fund engages in transaction hedging, the Fund enters into
foreign currency transactions with respect to specific receivables or
payables, generally arising in connection with the purchase or sale of
portfolio securities. A Fund will engage in transaction hedging when it
desires to "lock in" the U.S. dollar price of a security it has agreed to
purchase or sell, or the U.S. dollar equivalent of a dividend or interest
payment in a foreign currency. By transaction hedging a Fund will attempt
to protect itself against a possible loss resulting from an adverse change
in the relationship between the U.S. dollar and the applicable foreign
currency during the period between the date on which the security is
purchased or sold or on which the dividend or interest payment is declared,
and the date on which such payments are made or received.

A Fund may purchase or sell a foreign currency on a spot (or cash) basis at
the prevailing spot rate in connection with the settlement of transactions
in portfolio securities denominated in that foreign currency. A Fund may
also enter into contracts to purchase or sell foreign currencies at a future
date ("forward contracts") and purchase and sell foreign currency futures
contracts.

For transaction hedging purposes a Fund may also purchase exchange-listed
call and put options on foreign currencies. A put option on currency gives
the Fund the right to sell a currency at a specific exercise price. A call
option on currency gives a Fund the right to purchase a currency at a
specific exercise price. The time when call and put options are exercisable
depends on whether the options are American options or European options.
American options

18
<PAGE>

are exercisable at anytime during the option period. European options are
exercisable only on a designated date.

When it engages in position hedging, a Fund enters into foreign currency
exchange transactions to protect against a decline in the values of the
foreign currencies in which its portfolio securities are denominated or an
increase in the value of currency for securities which the Fund expects to
purchase, when the Fund holds cash or short-term investments. In connection
with position hedging, a Fund may purchase put or call options on foreign
currency and foreign currency futures contracts and buy or sell forward
contracts and foreign currency futures contracts. The Funds may also
purchase or sell foreign currency on a spot basis.

The precise matching of the amounts of foreign currency exchange
transactions and the value of the portfolio securities involved will not
generally be possible since the future value of such securities in foreign
currencies will change as a consequence of market movements in the value of
those securities between the dates the currency exchange transactions are
entered into and the dates they mature. For example, it may be necessary
for a Fund to purchase additional foreign currency on the spot market (and
bear the expense of such purchase) if the market value of the security or
securities being hedged is less than the amount of foreign currency a Fund
is obligated to deliver and a decision is made to sell the security or
securities and make delivery of the foreign currency. Conversely, it may be
necessary to sell on the spot market some of the foreign currency received
upon the sale of the portfolio security or securities if the market value of
such security or securities exceeds the amount of foreign currency a Fund is
obligated to deliver.

Transaction and position hedging do not eliminate fluctuations in the
underlying prices of the securities which a Fund owns or intends to purchase
or sell. They simply establish a rate of exchange which one can achieve at
some future point in time. Additionally, although these techniques tend to
minimize the risk of loss due to a decline in the value of the hedged
currency, they tend to limit any potential gain which might result from the
increase in value of such currency.

Regardless of whether CII (or CIIA in the case of CIGNA Variable Products
International Stock Fund) determines that it is advisable to hedge a Fund's
currency risk, the Funds will have to convert their holdings of foreign
currencies into U.S. dollars from time to time. Although foreign exchange
dealers generally do not charge a fee for conversion, they do realize a
profit based on the difference (the "spread") between the prices at which
they are buying and selling various currencies.

Forward Currency Contracts - A forward currency contract is an agreement
--------------------------
between two parties to purchase and sell a specific quantity of a currency
at a price specified at the time of the contract, with delivery and
settlement at a specified future date. In the case of purchases of forward
currency contracts, an amount of cash and cash equivalents, equal to the
market value of the portfolio security sold, will be deposited in a
segregated account with the Trust's Custodian to collateralize the position
and ensure that the use of such contracts is unleveraged.

19
<PAGE>

In the case of a cancelable forward contract, the holder has the unilateral
right to cancel the contract at maturity by paying a specified fee. The
contracts are traded in the interbank market conducted directly between
currency traders (usually large commercial banks and their customers). A
forward contract generally has no deposit requirements, and no commissions
are charged at any stage for trades.

Forward currency contracts are less liquid than currency futures contracts,
and there is an increased risk of default by the counterparty as compared to
futures contracts. Forward currency contracts differ from currency futures
contracts in certain other respects as well. For example, the maturity date
of a forward contract may be any fixed number of days from the date in a
given month. Forward contracts may be in any amounts agreed upon by the
parties rather than predetermined amounts. Also, forward currency contracts
are traded directly between currency traders so no intermediary is required.
A forward contract generally requires no margin or other deposit.

At the maturity of a forward contract, a Fund may either accept or make
delivery of the currency specified in the contract, or at or prior to
maturity enter into a closing transaction involving the purchase or sale of
an offsetting contract. Closing transactions with respect to forward
contracts are usually effected with the currency trader who is a party to
the original forward contract. There is no assurance that a Fund will be
able to close a forward contract prior to maturity and, under such
circumstances, a Fund may have exposure to adverse changes in exchange
rates.

INVESTMENT RESTRICTIONS
-----------------------

Each Fund is subject to the following investment restrictions, unless
otherwise noted, which may not be changed without the approval of the lesser
of (i) more than 50% of the outstanding shares of a Fund or (ii) 67% or more
of the shares of that Fund present at a meeting if more than 50% of the
outstanding shares of that Fund are represented at the meeting in person or
by proxy (see "Ownership of Fund Shares" in the Funds' prospectus for a
description of the individual's rights with respect to giving voting
instructions to Life Companies).

Any investment restriction that involves a maximum or minimum percentage of
securities or assets shall not be considered to be violated unless an excess
over or a deficiency under the percentage occurs immediately after, and is
caused by, an acquisition or disposition of securities or utilization of
assets by a Fund.

A Fund may not:

1. Invest in the securities of any issuer if, immediately after such
investment, more than 5% of the total assets of the Fund taken at current
value would be invested in the securities of such issuer, except (a) bank
certificates of deposit and obligations issued or guaranteed as to interest
and principal by the U.S. Government or its agencies or instrumentalities,
and (b) up to 25% of CIGNA Variable Products Money Market Fund's total
assets taken at current value may be invested without regard to such 5%
limitation in bankers'

20
<PAGE>

acceptances in which the Fund may invest consistent with its investment
policies.

2. Acquire more than 10% of the voting securities of any issuer or more
than 10% of any class of securities of any issuer. (For these purposes, all
preferred stocks of any issuer are regarded as a single class, and all debt
securities of an issuer are regarded as a single class.)

3. Concentrate more than 25% of its assets in any one industry, except
that CIGNA Variable Products Money Market Fund may invest up to 100% of its
assets (a) in the domestic banking industry, (b) in the personal credit
institution or business credit institution industries when, in the opinion
of management, yield differentials make such investments desirable, or (c)
in any combination of these.

4. Invest in securities of businesses less than three years old
(including predecessors), if, as a result, more than 5% of the Fund's total
assets (taken at current value) would then be invested in such securities.

5. Make investments for the purpose of gaining control of a company's
management.

6. Make short sales of securities or maintain a short position for the
account of the Fund unless at all times when a short position is open it
owns an equal amount of such securities or owns securities convertible into
or exchangeable for securities of the same issuer as, and equal in amount
to, the securities sold short.

7. Purchase securities on margin, except such short-term credits as may
be necessary for the clearance of purchases and sales of securities,
provided, however, that CIGNA Variable Products S&P 500 Index Fund, CIGNA
Variable Products International Stock Fund, CIGNA Variable Products High
Yield Fund and CIGNA Variable Products Income Fund may make margin payments
in connection with transactions in stock index futures contracts, financial
futures contracts and related options thereon.

8. Underwrite securities issued by other persons except to the extent
that, in connection with the disposition of its portfolio investments, it
may be deemed to be an underwriter under Federal securities laws.

9. Invest in securities of any issuer if, to the knowledge of the Fund,
officers and trustees of the Trust or officers and directors of CII who
beneficially own more than 1/2 of 1% of the securities of that issuer,
together own more than 5%.

10. Make loans, except (a) by purchase of debt obligations and through
repurchase agreements referred to under "Certain Investment Practices" in
the Funds' prospectus, provided, however, that repurchase agreements
maturing in more than seven days will not exceed 10% of a Fund's total
assets (taken at current value) and (b) through the lending of its portfolio
securities with respect to not more than 25% of its total assets. (As a
matter of policy, securities loans would be made to broker-dealers pursuant
to agreements requiring that loans be continuously secured by collateral in
cash or cash equivalents at

21
<PAGE>

least equal at all times to the value of the securities lent. The borrower
pays to the Fund an amount equal to any dividends or interest received on
the securities lent. The Fund may invest the cash collateral received in
interest-bearing short-term securities or receive a fee from the borrower.
The Fund may call such loans in order to sell the securities involved or to
exercise voting or other rights available to it as beneficial owner of the
securities involved.)

11. Borrow money in excess of one-third of the value (taken at the lower of
cost or current value) of its total assets (not including the amount
borrowed) at the time the borrowing is made, and then only as a temporary
measure to facilitate the meeting of redemption requests (not for leverage)
which might otherwise require the untimely disposition of portfolio
investments or for extraordinary or emergency purposes, except that the
Funds referred to in paragraph 7 above may enter into stock index futures
contracts and financial futures contracts, as indicated. Such borrowings
will be repaid before any additional investments are made. Interest paid on
such borrowings would reduce the yield on the Fund's investments. (The
Board of Trustees regards this restriction as setting forth the Trust's
policy with respect to the issuance of senior securities.)

12. Pledge, hypothecate, mortgage or otherwise encumber its assets in
excess of one-third of the value of its total assets (taken at the lower of
cost or current value) and then only to secure borrowings permitted by
Restriction No. 11 above. (For the purpose of this restriction, collateral
arrangements with respect to margin for a financial futures contract or
stock index futures contract are not deemed to be a pledge of assets.)

13. Purchase or sell mortgages or real estate, although it may purchase
securities of issuers that deal in real estate and may purchase securities
that are secured by interests in real estate.

14. Purchase or sell commodities or commodity contracts, except, however,
that CIGNA Variable Products S&P 500 Index Fund and CIGNA Variable Products
International Stock may purchase and sell stock index futures and options
thereon and CIGNA Variable Products Income Fund, CIGNA Variable Products
International Stock Fund and CIGNA Variable Products High Yield Fund may
purchase and sell financial futures contracts and options thereon.

15. Purchase options or puts, calls, straddles, spreads or combinations
thereof except, however, CIGNA Variable Products S&P 500 Index Fund and
CIGNA Variable Products International Stock Fund may purchase and sell
options on stock index futures contracts and on stock indices and CIGNA
Variable Products Income Fund, CIGNA Variable Products International Stock
Fund and CIGNA Variable Products High Yield Fund may purchase and sell
options on financial futures contracts; in connection with the purchase of
fixed income securities, however, a Fund may acquire warrants or other
rights to subscribe for securities of companies issuing such fixed-income
securities or securities of parents or subsidiaries of such companies. (See
"Description of Income Instruments for CIGNA Variable Products Income Fund"
and "Description of Income Instruments for CIGNA Variable

22
<PAGE>

Products High Yield Fund" for a description of the policy of these Funds
with respect to such warrants or other rights.)

16. Buy or sell oil, gas or other mineral leases, rights or royalty
contracts.

The foregoing percentages, as well as those percentages referred to under
"Investment Objectives and Policies," will apply at the time of the purchase
of a security and shall not be considered violated unless an excess or
deficiency occurs or exists immediately after and as a result of a purchase
of such security.

TAX MATTERS
-----------

Each series of shares of the Trust is treated as a separate association
taxable as a corporation.

Each Fund intends to qualify under the Internal Revenue Code of 1986 (the
"Code"), as amended, as a regulated investment company ("RIC") for each
taxable year. As of the date hereof, each Fund must, among other things,
meet the following requirements: A. Each Fund must derive at least 90% of
its gross income from dividends, interest, payments with respect to
securities loans, gains from the sale or other disposition of stock,
securities, foreign currencies, or other income including but not limited to
gains from options, futures or forward contracts derived with respect to its
business of investing in such stock, securities or currencies. B. Each
Fund must generally derive less than 30% of its gross income from the sale
or disposition of any of the following held less than three months: i)
stock or securities, ii) options, futures, or forward contracts (other than
options, futures, or forward contracts on foreign currencies), or iii)
foreign currencies (or options, futures, or forward contracts on foreign
currencies) but only if such currencies or options, futures or forward
contracts are not directly related to the Fund's business of investing in
stock, securities or options and futures thereon. There are exceptions to
the 30% test when a Fund, in combination with other factors, realizes gains
to satisfy abnormal redemptions. Abnormal redemptions occur on any day when
net redemptions exceed one percent of the Fund's net asset value.
Accordingly, the extent to which the Funds may engage in futures contracts
and related options may be materially limited by this 30% test with the
exception of CIGNA Variable Products Money Market Fund which does not engage
in such transactions. C. Each Fund must diversify its holdings so that, at
the end of each fiscal quarter: i) at least 50% of the market value of the
Fund's assets is represented by cash, U.S. Government securities and other
securities, with such other securities limited, with respect to any one
issuer, to an amount not greater than 5% of the Fund's assets and not more
than 10% of the outstanding voting securities of such issuer, and ii) not
more than 25% of the value of its assets is invested in the securities of
any one issuer (other than U.S. Government securities).

As a RIC, each Fund will not be subject to Federal income tax ("FIT") on its
income and gains distributed to shareholders if it distributes at least 90%
of its investment company taxable income for the taxable year.

23
<PAGE>

Under the provisions of Section 817(h) of the Code, a variable annuity
contract - other than a contract issued in connection with certain tax
qualified retirement plans or retirement plans maintained by certain
government employers - will not be treated as an annuity contract for any
period for which the investments of the separate account, such as the
separate accounts that are eligible to purchase shares of the Fund, are not
"adequately diversified". In general, the regulations issued under Section
817(h) provide that a separate account shall be considered adequately
diversified if the assets of such separate account are invested so that no
more than 55% of the value of such assets is represented by any one
investment, no more than 70% of such value is represented by any two
investments, no more than 80% of such value is represented by any three
investments and no more than 90% is represented by any four investments.
The Code allows a separate account to look through to the assets of a
regulated investment company for purposes of the "adequately diversified"
requirement. Each Fund intends that the investments in its portfolio shall
be "adequately diversified". For these purposes, all securities of the same
issuer are treated as a single investment. However, in the case of
government securities each government agency or instrumentality is treated
as a separate issuer. The regulations include a specific definition of
"government security" which includes any security issued, guaranteed or
insured by the United States or any instrumentalities of the United States.
In addition, a certificate of deposit for any of the foregoing securities is
included within the definition of a "government security." Accordingly,
certain Fund investments may be treated as "government securities" for the
purpose of Section 817(h) of the Code, even though such investments may not
be treated as a government security when such phrase is used elsewhere in
the prospectus or Statement of Additional Information.

All Funds except CIGNA Variable Products Money Market Fund: Section 1092 of
-----------------------------------------------------------
the Code affects the taxation of certain transactions involving futures or
options contracts. If a futures or options contract is part of a "straddle"
(which could include another futures contract or underlying stock or
securities), as defined in Section 1092 of the Code, then, generally, losses
are deferred first to the extent that the modified wash sale rules of the
Section 1092 regulations apply, and second to the extent of unrecognized
gains on offsetting positions. Further, a Fund may be required to
capitalize, rather than deduct currently, any interest expense on
indebtedness incurred or continued to purchase or carry any positions that
are part of a straddle. Sections 1092 and 246 of the Code and the
regulations thereunder also suspend the holding periods for straddle
positions with possible adverse effects regarding long-term capital gain
treatment and the corporate dividends-received deduction. In certain cases,
the wash sale rules of Section 1091 of the Code may operate to defer
deductions for losses.

Section 1256 of the Code generally requires that futures contracts and
options on future contracts be "marked-to-market" at the end of each year
for Federal income tax purposes. Section 1256 further characterizes 60% of
any gain or loss with respect to a futures contract as long-term capital
gain or loss and 40% as short-term capital gain or loss. If a futures
contract is held as an offsetting position and can be considered a straddle
under Section 1092 of the Code, such a straddle will constitute a mixed
straddle. A mixed

24
<PAGE>

straddle will be subject to both Section 1256 and Section 1092 unless
certain elections are made by the Fund.

The Funds may invest in certain foreign currency transactions which may be
subject to taxation under Section 988.

CIGNA Variable Products International Stock Fund
------------------------------------------------

If more than 50% of the value of the Fund's total assets consist of foreign
stock or securities at the close of its taxable year, the Fund may elect to
pass through the credit or deduction for foreign taxes to shareholders who
are U.S. persons (i.e., U.S. citizens and residents and U.S. domestic
corporations, partnerships, trusts, and estates). As a result, shareholders
who want to take the benefit of the foreign tax credit or deduction on their
U.S. income tax returns would include in gross income, in addition to
taxable dividends actually received from the Fund, their proportionate share
of foreign taxes paid by the Fund. If the Fund makes such an election, it
will report to shareholders, shortly after the end of the taxable year,
their proportionate share of gross foreign source income and foreign taxes
paid by the Fund.

The Fund may invest in shares of stock of a foreign entity which is
classified under the Internal Revenue Code as a Passive Foreign Investment
Company ("PFIC"). Investments in PFIC's may affect the character of gains,
the timing of recognition of gains or losses, and the amount of gains or
losses recognized. In addition, such investments may subject the Fund to a
U.S. federal income tax which cannot currently be eliminated by making
distributions to Fund shareholders.

A foreign corporation may be classified as a PFIC for a taxable year if 75%
or more of its gross income is passive income or the average holdings of
assets that produce passive income is at least one half of its total assets.
Passive income would include investment income, including but not limited
to, interest and dividend income. Under IRS rules, the Fund may be taxed on
its share of gain from a disposition of the PFIC stock, or an excess
distribution from the PFIC stock whether or not the income is distributed by
the Fund to its shareholders. In general, such gains or excess
distributions are held to be earned ratably over the period the Fund held
the PFIC stock. Amounts allocated to the Fund's prior taxable years will be
taxed at the highest corporate rate in effect for that year and an interest
factor will be added to the tax. Excess distributions and gains from the
disposition of the PFIC stock are treated as ordinary income.

Where feasible, the Fund intends to make either (1) a qualified electing
fund ("QEF") election or (2) a mark-to-market election under IRS rules in
order to avoid the imposition of a Fund level tax on its PFIC holdings.

If a QEF election is made the Fund must include in its gross income its
share of the ordinary earnings and net capital gains from the PFIC shares in
the year that the election is made (and all future years the PFIC stock is
held) regardless of whether distributions are received from the PFIC in the
current year. This income would then be passed through to shareholders.

25
<PAGE>

Under a mark-to-market election, if the fair market value ("FMV") of the
Fund's PFIC shares at the end of its taxable year is greater than the FMV of
the shares at the beginning of its taxable year (or the date of purchase
whichever is later), the difference will be included in the Fund's gross
income whether or not the Fund's shares are sold in that year. This income
would then be passed through to shareholders as ordinary income. Any mark-
to-market gain recognized by the Fund would be added to its tax basis in the
PFIC shares. If, however, as of the end of the Fund's taxable year the FMV
of the PFIC shares has decreased relative to their FMV at the beginning of
the year (or the date of purchase whichever is later), the Fund would not be
entitled to recognize the loss.

Shareholders who are not U.S. persons (i.e., U.S. citizens and residents and
U.S. domestic corporations, partnerships, trusts and estates) should consult
their tax advisers regarding U.S. and foreign tax consequences of ownership
of shares of the Fund including the likelihood that distributions to them
would be subject to withholding of U.S. tax at a rate of 30% (or at a lower
rate under a tax treaty).

ACTIVITIES OF AFFILIATED COMPANIES
----------------------------------

From time to time, as purchases of securities are made for the portfolios of
companies affiliated with CIGNA Corporation it is possible that two or more
portfolios may simultaneously purchase or sell the same security. To the
extent that two or more such portfolios, buying or selling the same
security, increase the total demand or supply, there may be an adverse
effect on the price of such security or on the amount which the Fund can
purchase or sell.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
---------------------------------------------------

All of the outstanding shares of each Fund are owned by CG Life, which is
considered an "affiliate" of the Trust. CG Life is a stock life insurance
company domiciled in the state of Connecticut. The offices of CG Life are
located at 900 Cottage Grove Road, Bloomfield, CT 06002. CG Life is an
indirect, wholly-owned subsidiary of CIGNA Corporation.

MANAGEMENT OF THE FUNDS
-----------------------

The Trustees and the executive officers of the Trust are listed below,
together with information as to their principal occupations during the past
five years and other principal business affiliations. Currently each holds
the equivalent position as Trustee and/or officer of CIGNA Institutional
Funds Group and CIGNA High Income Shares, and holds a similar position as
Director and/or executive officer of INA Investment Securities, Inc.
Correspondence with any Trustee or officer may be addressed to the Trust,
1380 Main Street, Springfield, Massachusetts 01103.

R. BRUCE ALBRO*, 52, Trustee; Senior Managing Director and Division Head,
CIGNA Portfolio Advisers, a division of CII; Chairman of the Board and
President, CIGNA Funds Group (f/k/a CIGNA Annuity Funds Group), CIGNA
Institutional Funds Group, CIGNA Variable Products Group, CIGNA High Income
Shares and INA Investment Securities, Inc. Mr. Albro is also an officer or
director of various other entities which are subsidiaries or affiliates of
CIGNA. Previously Trustee, CIGNA Funds Group; Managing Director - Division
Head, CII; Managing

26
<PAGE>

Director, CII; Senior Vice President, CII and CIGNA Investment Management
Company and President, CIGNA Capital Brokerage, Inc.

HUGH R. BEATH, 63, Trustee; Advisory Director, AdMedia Corporate Advisors,
Inc.; previously Chairman of the Board of Directors, Beath Advisors, Inc.
Chairman, President and Chief Executive Officer, ADVO-System, Inc.
(presently known as ADVO, Inc.) (direct mail advertising); Executive Vice
President, Operations, John Blair & Co. (marketing and communications);
President, Specialty Grocery Products Division, R. J. Reynolds Industries
(consumer products); and Vice President and Treasurer, Heublein, Inc. (maker
of distilled spirits).

RUSSELL H. JONES, 51, Trustee; Vice President, Kaman Corporation
(helicopters and aircraft components, scientific research); Trustee,
Connecticut Policy and Economic Counsel; Corporator, Hartford Seminary;
Secretary, Bloomfield Chamber of Commerce.

PAUL J. MCDONALD, 52, Trustee; Executive Vice President, Finance and Chief
Financial Officer, Friendly Ice Cream Corporation (family restaurants/dairy
products); Chairman, Dean's Advisory Council, University of Massachusetts
School of Management; Vice Chairman, Springfield YMCA; Corporator,
Springfield Institution for Savings; Trustee, Springfield College.
Previously, Vice President, Finance and Chief Financial Officer, Friendly
Ice Cream Corporation.

ARTHUR C. REEDS, III*, 51, Trustee; President, CIGNA Investment Management
(formerly known as CIGNA Investment Division); President and Director, CIGNA
Investment Group, Inc. and CII; Director, CIGNA International Investment
Advisors, Ltd. Mr. Reeds is also an officer or director of various other
entities which are subsidiaries or affiliates of CIGNA. Previously Trustee,
CIGNA Funds Group; Managing Director - Division Head, CIGNA Portfolio
Advisers, a division of CII; Senior Vice President, CII.

ALFRED A. BINGHAM III, 50, Vice President and Treasurer, CIGNA Funds Group
(f/k/a CIGNA Annuity Funds Group), CIGNA Institutional Funds Group, CIGNA
Variable Products Group, CIGNA High Income Shares and INA Investment
Securities, Inc.; Assistant Vice President, CII; previously Vice President
and Treasurer, CIGNA Funds Group; Senior Vice President and Treasurer, CIGNA
Investments, Inc.; Vice President and Treasurer, CIGNA Capital Brokerage,
Inc.

LAWRENCE S. HARRIS, 53, Senior Managing Director, CII; Vice President, CIGNA
Funds Group (f/k/a CIGNA Annuity Funds Group), CIGNA Institutional Funds
Group, CIGNA Variable Products Group, CIGNA High Income Shares and INA
Investment Securities, Inc.; previously Managing Director-Division Head,
CII; Vice President, CIGNA Funds Group; Senior Vice President and Director,
Alliance Capital Management L.P.

JEFFREY S. WINER, 38, Counsel, CIGNA; Vice President and Secretary, CIGNA
Funds Group (f/k/a CIGNA Annuity Funds Group), CIGNA Institutional Funds
Group, CIGNA Variable Products Group, CIGNA High Income Shares and INA
Investment Securities, Inc.; previously Attorney, CIGNA; Associate, Tarlow,
Levy, Harding & Droney (private law firm).

27
<PAGE>

*Trustees identified with an asterisk are considered interested persons
within the meaning of the Investment Company Act of 1940, as amended, because
of their affiliation with CIGNA Corporation or its affiliates.

The Board has created an Audit Committee from among its members which meets
periodically with representatives of Price Waterhouse LLP, independent
accountants for the Trust, a Contracts Committee which, as part of its
duties, considers the terms and the renewal of the Master Investment Advisory
Agreement with CII and the Sub-Advisory Agreement with CIIA, and a Nominating
Committee which considers the identification of new members of the Board and
the compensation of Trustees. The Nominating Committee, Audit Committee and
Contracts Committee consist of Trustees who are not affiliated with CIGNA
Corporation or any of its subsidiaries.

The Trust pays no compensation to any of its officers, other than the
reimbursement of the costs of the Office of the Treasurer and the Office of
the Secretary, or to any of its Trustees who are officers or employees of
CIGNA Corporation or its affiliates. The following table shows compensation
paid by the Trust and other investment companies in the CIGNA fund complex to
Trust Trustees in 1995:
<TABLE>
<CAPTION>

Pension or
Retirement Total
Benefits Compensation
Accrued As from Trusts and
Aggregate Part of Estimated Annual CIGNA Fund
Name of Person, Compensation Trust Benefits Upon Complex Paid to
Position with Trusts from Trust Expense Retirement Trustees (d)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
R. Bruce Albro, Trustee, $ - $ - $ - $ -
Chairman and President

Hugh R. Beath, Trustee (a) $ 3,600 - - $21,800

Russell H. Jones, Trustee $ 2,100 - - $13,150

Paul J. McDonald, Trustee (b) $ 2,100 - - $13,150

Arthur C. Reeds, III, Trustee - - - -

Worth Loomis* $ 2,000 - - $12,300

Nathaniel J. Howe* (c) $ 2,000 - - $12,300

------------ ------------ ------------ ------------
$11,800 $ $ $72,700
============ ============ ============ ============
</TABLE>

*Retired April 1995

28
<PAGE>

(a) All of Mr. Beath's 1995 compensation was deferred under a deferred
compensation plan for all CIGNA funds (the "Plan") in which he had an
aggregate balance of $90,019 as of December 31, 1995. The Plan permits
Trustees to defer receipt of all compensation or to revoke the election to
defer receipt of Trustee fees and receive payment directly.

(b) All of Mr. McDonald's 1995 compensation was deferred under a deferred
compensation plan (the "Plan") for all CIGNA funds in which he had an
aggregate balance of $13,838 as of December 31, 1995. The Plan permits
Trustees to defer receipt of all compensation or to revoke the election to
defer receipt of Trustee fees and receive payment directly.

(c) All of Mr. Howe's 1995 compensation was deferred under a deferred
compensation plan for all CIGNA Funds (the "Plan") in which he had an
aggregate balance of $154,087 as of December 31, 1995. The Plan permits
Trustees to defer receipt of all compensation or to evoke the election to
defer receipt of Trustee fees and receive payment directly.

(d) There were three (3) investment companies besides the Trusts in the
CIGNA fund complex.

INVESTMENT ADVISORY AND OTHER SERVICES
- --------------------------------------

The investment adviser to each of the Funds is CII, an indirect, wholly-owned
subsidiary of CIGNA Corporation. CIIA serves as investment sub-adviser to CIGNA
Variable Products International Stock Fund. CII also serves as investment
adviser for investment companies sponsored by affiliates of CIGNA Corporation,
and for a number of pension, advisory, corporate and other accounts. CII and
other affiliates of CIGNA Corporation manage combined assets of over $70
billion. CII's mailing address is Hartford, Connecticut 06152.

Pursuant to a Master Investment Advisory Agreement between the Trust and CII,
CII manages the investment and reinvestment of the assets of the Funds.

Subject to the control and periodic review of the Board of Trustees of the
Trust, CII (CIIA in the case of CIGNA Variable Products International Stock
Fund) determines what investments shall be purchased, held, sold or exchanged
for the account of the Funds, and what portion, if any, of the assets of the
Funds shall be held in cash and other temporary investments. Accordingly, the
role of the Trustees is not to approve specific investments, but rather to
exercise a control and review function.

The Trust pays all expenses not specifically assumed by CII including
compensation and expenses of Trustees who are not Directors, officers or
employees of CII or any other affiliates of CIGNA Corporation; registration,
filing and other fees in connection with filings with regulatory authorities;
the fees and expenses of independent accountants; costs of printing and mailing
registration statements, prospectuses, proxy statements, and annual and periodic
reports to shareholders; custodian and transfer agent fees; brokerage
commissions and securities transactions costs incurred by the Trust; taxes and
corporate fees; legal fees incurred in connection with the affairs of the Trust;
and expenses of meetings of the shareholders and Trustees.

CII, at its own expense, furnishes to the Trust office space and facilities and,
except with respect to the Office of the Treasurer and Office of the Secretary
as provided in the Master Investment Advisory Agreement, all personnel for
managing the affairs of the Trust and each of Funds. The Trust and other
registered investment companies advised by CII have agreed to reimburse CII for
its costs of maintaining the Office of the Treasurer and the cost of the Office
of the Secretary as provided in their respective investment

29
<PAGE>

advisory agreements. CII has estimated that in 1996 the total expenses of the
Office of the Treasurer will not exceed $277,000 and the expenses of the Office
of the Secretary are not expected to exceed $88,000. The portion of these
expenses allocated to each Fund for calendar year 1996 are not expected to
exceed the following amounts:

Office of Office of
the Treasurer the Secretary
------------- -------------

CIGNA Variable Products S&P 500 $40,000 $ 15,500
Index Fund

In 1995 the costs reimbursed by the Trust for the Office of the Treasurer and
the Office of the Secretary were $38,902 and $15,152, respectively.

The Board of Trustees of the Trust has approved the method under which this cost
will be allocated to the Trust, and then to each Fund.

As full compensation for the investment management and all other services
rendered by CII and any sub-adviser, each Fund pays CII a separate fee computed
daily and paid monthly at annual rates based on a percentage of the value of the
relevant Fund's average daily net assets, as follows: CIGNA Variable Products
Income Fund - 0.50%; CIGNA Variable Products High Yield Fund - 0.75%; CIGNA
Variable Products Money Market Fund - 0.35%; CIGNA Variable Products S&P 500
Index Fund - 0.25%; and CIGNA Variable Products International Stock Fund -0.80%.
Reflecting the specialized nature of their investment policies, the management
fees paid by CIGNA Variable Products High Yield Fund and CIGNA Variable Products
International Stock Fund exceed those paid by most other investment companies.
These fees, however, are comparable to those paid by funds with similar
investment objectives.

Trust-wide expenses not identifiable to any particular Fund will be allocated
among the Funds. CII has voluntarily agreed to reimburse the Funds to the
extent that the annual operating expenses in any one year (excluding interest,
taxes, amortized organizational expense, transaction costs in acquiring and
disposing of portfolio securities and extraordinary expenses) of a Fund exceed a
percentage of the value of the relevant Fund's average daily net assets, as
follows: CIGNA Variable Products High Yield Fund - 1.25%; CIGNA Variable
Products Income Fund - 1%; CIGNA Variable Products International Stock Fund -
1.25%; CIGNA Variable Products Money Market Fund - 0.50%; and CIGNA Variable
Products S&P 500 Index Fund - 0.60%.

CIGNA Variable Products S&P 500 Index Fund incurred a management fee payable to
CII of $213,557, $201,131 and $226,788 for fiscal years 1995, 1994 and 1993,
respectively. The amounts payable were not reduced by the then applicable
expense limitation.

The Master Investment Advisory Agreement provides that it will continue from
year to year as to a Fund provided that such continuance is specifically
approved at least annually: (a) by a vote of the "majority of the outstanding
voting securities" (as such term is defined in the 1940 Act) of that Fund or by
the Board of Trustees of the Trust, and (b) by a vote of a majority of the
Trustees who are not parties to the agreement or "interested persons" (as
defined in the 1940 Acct) of any party thereto, cast in person at a meeting
called for the purpose of voting on such approval. The Master Investment
Advisory Agreement provides that it (i) may be terminated at any time without

30
<PAGE>

penalty (a) upon 60 days' written notice by vote of the Trustees of the Trust,
or with respect to any Fund, by vote of a majority of the outstanding voting
securities of such Fund, or (b) by CII upon 90 days' written notice to the Trust
in the case of the Master Investment Advisory Agreement and (ii) will
automatically terminate in the event of its "assignment" (as such term is
defined in the 1940 Act).

The Master Trust Agreement acknowledges CIGNA Corporation's control over the
name "CIGNA." The Trust and the Fund would be obliged to change their names to
eliminate the word "CIGNA" (to the extent they could lawfully do so) in the
event CIGNA Corporation were to withdraw its permission for use of such name.
CIGNA Corporation has agreed not to withdraw such permission from the Trust or a
series of the Trust so long as an affiliate of CIGNA Corporation shall be the
investment adviser for such series.

The Trust's Custodian and Transfer Agent is State Street Bank and Trust Company
("State Street"), Boston, Massachusetts 02107. Under its Custodian Agreement,
State Street maintains the portfolio securities of each Fund, administers the
purchases and sales of portfolio securities, collects interest and dividends and
other distributions made on the securities held in the portfolio, determines the
net asset value of shares of each Fund on a daily basis and performs such other
ministerial duties as are included in the Custodian Agreement and Agency
Agreement, copies of which are on file with the Securities and Exchange
Commission.

Price Waterhouse LLP acts as independent accountants for the Trust. Its offices
are at 160 Federal Street, Boston, Massachusetts 02110. Price Waterhouse LLP
representatives annually perform an audit of the financial statements of the
Trust and provide accounting advice and services throughout the year. Price
Waterhouse LLP reports its activities and the results of its audit to the Audit
Committee of the Board of Trustees. Price Waterhouse LLP also provides certain
tax advice to the Trust.

PORTFOLIO TURNOVER AND BROKERAGE ALLOCATION
- -------------------------------------------

It is anticipated that the Funds' annual portfolio turnover will not exceed
100%. With respect to CIGNA Variable Products Money Market Fund, CIGNA Variable
Products High Yield Fund and CIGNA Variable Products Income Fund, purchases and
sales of portfolio securities are generally transacted with the issuer or a
primary market maker of these securities on a net basis, without any brokerage
commission being paid by the Funds for such purchases. Purchases from dealers
serving as primary market makers reflect the spread between the bid and asked
prices. Purchases and sales for CIGNA Variable Products S&P 500 Index Fund and
CIGNA Variable Products International Stock Fund generally involve a broker.

Transactions on U.S. stock exchanges, commodities markets and futures markets
and other agency transactions involve the payment of negotiated brokerage
commissions. Such commissions vary among different brokers. A particular
broker may charge different commissions according to such factors as the
difficulty and size of the transaction. Transactions in foreign investments
often involve the payment of fixed brokerage commissions, which may be higher
than those in the over-the-counter markets, but the price paid usually includes
an undisclosed dealer commission or mark-up as well as a disclosed, fixed
commission or discount retained by the underwriter or dealer.

31
<PAGE>

It is the policy of CII on behalf of its clients, including the Funds, to have
purchases and sales of portfolio securities executed at the most favorable
prices, considering all costs of the transaction, including brokerage
commissions and spreads, and research services received, consistent with
obtaining best execution.

In seeking best execution, CII selects broker/dealers on the basis of their
professional capability and the value and quality of their brokerage services.
Brokerage services include the ability to execute most effectively large orders
without adversely affecting markets and the positioning of securities in order
to effect orderly sales for clients.

The officers of CII determine, generally without limitation, the broker/dealers
through whom, and the commission rates or spreads at which, securities
transactions for client accounts are executed. The officers of CII may select a
broker/dealer who may receive a commission for portfolio transactions exceeding
the amount another broker/dealer would have charged for the same transaction if
they determine that such amount of commission is reasonable in relation to the
value of the brokerage or research services performed or provided by the
broker/dealer, viewed in terms of either that particular transaction or CII's
overall responsibilities to the client for whose account such portfolio
transaction is executed and other accounts advised by CII or accounts advised by
other investment advisers which are related persons of CII.

If two or more broker/dealers are considered able to offer the same favorable
price with the equivalent likelihood of best execution, the officers of CII may
prefer the broker/dealer who has furnished research services. Research services
include market information, analysis of specific issues, presentation of special
situations and trading opportunities on a timely basis, advice concerning
industries, economic factors and trends, portfolio strategy and performance of
accounts.

Research services are used in advising all accounts, including accounts advised
by related persons of CII, and not all such services are necessarily used by CII
in connection with the specific account that paid commissions to the
broker/dealer providing such services.

The overall reasonableness of brokerage commissions paid is evaluated
continually. Such evaluation includes review of what competing broker/dealers
are willing to charge for similar types of services and what discounts are being
granted by brokerage firms. The evaluation also considers the timeliness and
accuracy of the research received.

In addition, CII may, if permitted by applicable law, pay for products or
services other than brokerage and research services with brokerage commissions
as interpreted in SEC Release 34-23170 dated April 23, 1986. Pursuant to that
release, products and services which provide lawful and appropriate assistance
to CII's investment decision-making process may be paid for with brokerage
commissions to the extent such products and services are used in that process.
Where the research service product has a mixed use, that is, the product may
serve a number of functions certain of which are not related to the making of
investment decisions, CII allocates the cost of the product on a basis which
they deem reasonable, according to the various uses of the product, and maintain
records documenting the allocation process followed. Only that portion of the
cost of the product allocable to research services is paid from the Fund. The
Fund does not acquire research services through the generation

32
<PAGE>

of credits with respect to principal transactions or transactions in financial
futures, except in new issue fixed price underwritings.

The Trust does not presently allocate brokerage commissions to, or place orders
for portfolio transactions with, either directly or indirectly, brokers based on
their sales of shares of the Funds. Except as noted, the Trust does not utilize
an affiliated broker in effecting portfolio transactions and does not recapture
commissions paid in such transactions. Brokerage commissions paid by CIGNA
Variable Products S&P 500 Index Fund for 1995, 1994 and 1993 totaled $4,667,
$3,100 and $208,900, respectively, substantially all of which were paid to firms
which provided research services to CII.

As of December 31, 1995, Sanford C. Bernstein & Co., Inc. ("SCB") reported
ownership of approximately 7.40% of the outstanding common stock of CIGNA
Corporation. In addition, FMR Corp. ("FMR") reported ownership of approximately
7.70% of the outstanding common stock of CIGNA as of December 31, 1995.
Accordingly, CIGNA may be deemed to be an affiliated person of SCB and FMR
pursuant to the provisions of the 1940 Act. As long as CIGNA may be deemed to
be an affiliated person of SCB or FMR, a Fund will not engage in any transaction
with SCB or FMR when SCB or FMR is acting for their own account and will engage
in brokerage transactions with SCB and FMR only under circumstances where the
commission, spread or profit received by the broker is fair and reasonable
pursuant to rules established by the Securities and Exchange Commission and
procedures adopted and monitored by the Board of Trustees of the Trust. During
1995, the Funds did not engage in brokerage transactions with SCB or FMR. This
amount of brokerage commissions represented less than 1% of the aggregate of
brokerage and underwriting commissions paid by the Funds in 1995 and represented
less than 1% of the total value of the Funds' portfolio transactions which
involved brokerage or underwriting commissions.

PERFORMANCE INFORMATION
- -----------------------

Total return and yield figures for the Funds are neither fixed nor guaranteed,
and no Fund's principal is insured. Performance quotations reflect historical
information and should not be considered representative of a Fund's performance
for any period in the future. Performance is a function of a number of factors
which can be expected to fluctuate. The Funds may provide performance
information in reports, sales literature and advertisements if accompanied by
performance of your Life Company's separate account. The Funds may also, from
time to time, quote information about the Funds published or aired by
publications or other media entities which contain articles or segments relating
to investment results or other data about one or more of the Funds. The
following is a list of such publications or media entities:

<TABLE>
<S> <C> <C>
Advertising Age Financial Times Kiplinger
Barron's Financial Weekly Money
Barron's/Nelson's Financial World Mutual Fund Forecaster
Best's Review Forbes Nation's Business
Broker World Fortune New York Times
Business Week Global Investor Pensions World
Changing Times Hartford Courant Pensions & Investments
Christian Science Monitor Institutional Investor Personal Investor
Consumer Reports Insurance Forum Philadelphia Inquirer
Economist Insurance Weekly The Times (London)
Equity International International Business USA Today
FACS of the Week Week U.S. News & World Report

</TABLE>

33
<PAGE>

<TABLE>
<S> <C> <C>
Far Eastern Investing Wall Street Journal
Economic Review Investor's Chronicle Washington Post
Financial Adviser Investor's Daily CNN
Financial Planning Journal of the American CNBC
Financial Product News Society of CLu & ChFC PBS
Financial Services Week
</TABLE>

Each Fund may also compare its performance to performance data of similar
mutual funds as published by the following services:

<TABLE>
<S> <C>
Lipper Analytical Services Stanger Report
CDA Investment Technologies, Inc. Weisenberger
Frank Russell Co. Micropal, Ltd.
InterSec Research
</TABLE>

Although performance data may be useful to prospective investors in
comparing with other funds and other potential investments, investors should
note that the methods of computing performance of other potential
investments are not necessarily comparable to the methods employed by a
Fund.

Total Return Quotations
-----------------------

The standard formula for calculating total return, as described in the
prospectus, is as follows:
P(1+T)/n/=ERV

Where P = A hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = ending redeemable value of a hypothetical $1,000 payment at
the end of the 1, 5, or 10 year periods (or fractional
portion of such period).

Cumulative total return across a stated period may be calculated as follows:

P(1+V)=ERV

Where P = A hypothetical initial payment of $1,000.
V = cumulative total return.
ERV = ending redeemable value of a hypothetical $1,000 payment at
the end of the stated period.

The average annual total returns for CIGNA Variable Products S&P 500 Index
Fund and CIGNA Variable Products Money Market Fund for the one, five and ten
year periods (or since inception, if shorter) ended March 31, 1996 were as
follow:

<TABLE>
<CAPTION>
Periods ended March 31, 1996
CIGNA Variable Products 1 Year 5 Years 10 Years
------ ------- --------
<S> <C> <C> <C>
S&P 500 Index Fund 31.40% 12.56% 11.73%
Money Market Fund 0.40%* --- ---
</TABLE>

Yield Quotations
----------------

* For one month period, March 1, 1996 (commencement of operations) to March 31,
1996

34
<PAGE>

The standard formula for calculating yield for each Fund except CIGNA
Variable Products Money Market fund, as described in the prospectus, is as
follows:

YIELD = 2[((a-b)/(c x d) + 1)/6/-1]

Where a = dividends and interest earned during a stated 30 day period.
For purposes of this calculation, dividends are accrued
rather than recorded on the ex-dividend date. Interest
earned under this formula must generally be calculated based
on the yield to maturity of each obligation (or, if more
appropriate, based on yield to call date).
b = expense accrued during period (net of reimbursement).
c = the average daily number of shares outstanding during the
period.
d = the maximum offering price per share on the last day of the
period.

The standard formula for calculating annualized yield for CIGNA Variable
Products Money Market Fund, as described in the prospectus, is as follows:

Y = V\\1\\ - V\\o\\ 365
V\\o\\ 7

Where Y = annualized yield.
V\\o\\ = the value of a hypothetical pre-existing account in the Fund
having a balance of one share at the beginning of a stated
seven-day period.
V\\1\\ = the value of such an account at the end of the stated
period.

The annulized yield for CIGNA variable Products Money Market Fund for the 7
days ended March 31, 1996 was 4.73%.

The standard formula for calculating effective annualized yield for CIGNA
Variable Products Money Market Fund, as described in the prospectus, is as
follows:

EY = [(Y+1)/365/7/] -1

Where EY = effective annualized yield.
Y = annualized yield, as determined above.

The effective annualized yield for CIGNA Variable Products Money Market
Fund for the 7 days ended March 31, 1996 was 4.84%.

For the purpose of the annualized yield and effective annualized yield, the
net change in the value of the hypothetical CIGNA Variable Products Money
Market Fund account reflects the value of additional shares purchased with
dividends from the original share and any such additional shares, and all
fees charged to all shareholder accounts in proportion to the length of the
base period and the Fund's average account size, but does not include
realized gains and losses or unrealized appreciation and depreciation.

PURCHASE, REDEMPTION AND PRICING OF SECURITIES
----------------------------------------------

The Funds may suspend redemptions or postpone the date of payment during any
period when: (a) the New York Stock Exchange is closed

35
<PAGE>

for other than customary weekend and holiday closings or trading on such
Exchange is restricted; (b) the Securities and Exchange Commission has by
order permitted such suspension for the protection of the Fund's
shareholders; or (c) an emergency exists as determined by the Securities and
Exchange Commission making disposal of portfolio securities or valuation of
net assets of the Fund not reasonably practicable.

A Fund's net asset value is calculated by dividing the number of outstanding
shares into the net assets of the Fund. Net assets are the excess of a
Fund's assets over its liabilities. Additional information concerning
purchase and redemption of securities may be found in the current prospectus
for the Funds.

CIGNA Variable Products Money Market Fund. The investments of CIGNA
------------------------------------------
Variable Products Money Market Fund are valued at amortized cost. The
amortized cost of an instrument is determined by valuing it at cost
originally and thereafter amortizing any discount or premium from its face
value at a constant rate until maturity, regardless of the effect of
fluctuating interest rates on the market value of the instrument. The
amortized cost method may result at times in determinations of value that
are higher or lower than the price the Fund would receive if the instruments
were sold. During periods of declining interest rates, use by the Fund of
the amortized cost method of valuing its portfolio may result in a lower
value than the market value of the portfolio, which could be an advantage to
new investors relative to existing shareholders. The converse would apply
in a period of rising interest rates.

The valuation of the investments of CIGNA Variable Products Money Market
Fund at amortized cost is permitted by the Securities and Exchange
Commission, and the Fund is required to adhere to certain conditions so long
as it uses this valuation method. CIGNA Variable Products Money Market Fund
will maintain a dollar-weighted average portfolio maturity of 90 days or
less, will purchase only instruments having remaining maturities of one year
or less (except as otherwise noted under "Variable and Floating Note
Instruments" under "Description of Money Market Instruments" in this
Statement of Additional Information) and will invest only in securities
determined by the Board of Trustees to be of high quality with minimal
credit risks. The Board of Trustees has also established procedures
reasonably designed, taking into account current market conditions and the
Fund's investment objective, to stabilize the Fund's price per share as
computed for the purpose of distribution, redemption and repurchase at
$1.00. Such procedures include a review of the Fund's portfolio holdings by
the Board of Trustees, at such intervals as they may deem appropriate, to
determine whether the Fund's net asset value, calculated by using readily
available market quotations, deviates from $1.00 per share, and, if so,
whether such deviation may result in material dilution or is otherwise
unfair to existing shareholders. In the event the Board of Trustees
determines that such a deviation exists, it will take such corrective action
as it deems necessary and appropriate, including selling portfolio
instruments prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; withholding dividends; redeeming shares
in kind; or establishing a net asset value per share

36
<PAGE>

by using readily available market quotations in which case, the net asset
value could possibly be greater or less than $1.00 per share.

CIGNA Variable Products Income Fund, CIGNA Variable Products High Yield
-----------------------------------------------------------------------
Fund, CIGNA Variable Products S&P 500 Index Fund and CIGNA Variable Products
----------------------------------------------------------------------------
International Stock Fund. Information describing the valuation of
-------------------------
securities held in these Funds is found in the prospectus under "Computation
of Net Asset Value."

DIVIDENDS
---------

Information concerning dividends is found in the current prospectus for the
Funds.

LIMITATION ON TRANSFERS
-----------------------

Whenever the Trust or its duly appointed transfer agent is requested to
transfer Fund shares to other than an Eligible Purchaser, the Trust has the
right at its election to purchase such shares at their net asset value next
effective following the time at which the request for transfer is presented;
provided, however, that the Trust must notify the transferee or transferee
of such shares in writing of its election to purchase such shares within
seven (7) days following the date of such request and settlement for such
shares shall be made within such seven-day period.

RATINGS OF SECURITIES
---------------------

Description of Standard & Poor's Corporation ("Standard & Poor's") and
Moody's Investors Service, Inc. ("Moody's") commercial paper and bond
rating:

COMMERCIAL PAPER RATINGS--Standard & Poor's commercial paper ratings are
graded into four categories, ranging from "A" for the highest quality
obligations to "D" for the lowest. Issues assigned an "A" rating are
regarded as having the greatest capacity for timely payment. Issues in this
category are delineated with the numbers 1, 2, and 3 to indicate the
relative degree of safety.

The two highest categories, A-1 and A-2, are described as follows:

"A-1" This designation indicates that the degree of safety regarding
timely payment is either overwhelming or very strong. Those issues
determined to possess overwhelming safety characteristics will be
denoted with a plus (+) sign designation.

"A-2" Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for
issues designated "A-1."

Moody's employs three designations, all judged to be investment grade, to
indicate the relative repayment capacity of rated issuers. The two highest
designations are as follows:

37
<PAGE>

Issuers rated Prime-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following
characteristics:

. Leading market positions in well-established industries.

. High rates of return on funds employed.

. Conservative capitalization structures with moderate reliance on
debt and ample asset protection.

. Broad margins in earnings coverage of fixed financial charges and
high internal cash generation.

. Well-established access to a range of financial markets and assured
sources of alternate liquidity.

Issuers rated Prime-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.

BOND RATINGS--S&P describes its ratings for corporate bonds as follows:

AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA - Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.

A - Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than debt in higher rated
categories.

BBB - Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity to pay interest and repay
principal for debt in this category than in higher rated categories.

BB-B-CCC-CC - Debt rated BB, B, CCC and CC is regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation.
While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

38
<PAGE>

Moody's describes its ratings for corporate bonds as follows:

Aaa - Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt-edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.

Aa - Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally
known as high grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities.

A - Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may
be present which suggest a susceptibility to impairment sometime in the
future.

Baa - Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

Ba - Bonds which are rated Ba are judged to have speculative elements, their
future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.

B - Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance
of other terms of the contract over any long period of time may be small.

Caa - Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal
or interest.

Ca - Bonds which are rated Ca represent obligations which are speculative
in a high degree. Such issues are often in default or have other marked
shortcomings.

C - Bonds which are rated C are the lowest rated class of bonds and issues
so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.

39
<PAGE>

MUNICIPAL BOND RATINGS--The four highest ratings of Moody's for Municipal
Bonds are Aaa, Aa, A and Baa. Municipal bonds rated Aaa are judged to be of
the "best quality." The rating of Aa is assigned to municipal bonds which
are of "high quality by all standards," but as to which margins of
protection or other elements make long-term risks appear somewhat larger
than Aaa-rated municipal bonds. The Aaa- and Aa-rated municipal bonds
comprise what are generally known as "high-grade bonds." Municipal bonds
which are rated A by Moody's possess many favorable investment attributes
and are considered "upper-medium-grade obligations." Factors giving
security to principal and interest of A-rated municipal bonds are considered
adequate, but elements may be present which suggest a susceptibility to
impairment sometime in the future. Bonds rated Baa are considered as
"medium-grade" obligations. They are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time.

The four highest ratings of Standard & Poor's for municipal bonds are AAA
(Prime), AA (High Grade), A (Good Grade) and BBB (Medium Grade). Municipal
bonds rated AAA are "obligations of the highest quality." The rating of AA
is accorded issues with investment characteristics "only slightly less
marked than those of the prime quality issues." The category of A describes
"the third strongest capacity for payment-of-debt service." Principal and
interest payments on bonds in this category are regarded as safe. It
differs from the two higher ratings because with respect to general
obligation bonds, there is some weakness, either in the local economic base,
in debt burden, in the balance between revenues and expenditures, or in
quality of management. Under certain adverse circumstances, any one such
weakness might impair the ability of the issuer to meet debt obligations at
some future date. With respect to revenue bonds, debt service coverage is
good, but not exceptional. Stability of the pledged revenues could show
some variations because of increased competition or economic influences on
revenues. Basic security provisions, while satisfactory, are less
stringent. Management performance appears adequate. The BBB rating is the
lowest "investment-grade" security rating by Standard & Poor's. The
difference between A and BBB ratings is that the latter shows more than one
fundamental weakness, or one very substantial fundamental weakness, whereas
the former shows only one deficiency among the factors considered. With
respect to revenue bonds, debt coverage is only fair. Stability of the
pledged revenues could show substantial variations, with the revenue flow
possibly being subject to erosion over time. Basic security provisions are
no more than adequate. Management performance could be stronger.

40
<PAGE>

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND
FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD MARCH 1, 1996 (COMMENCEMENT OF OPERATIONS)
TO MARCH 31, 1996

<PAGE>

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND
INVESTMENTS IN SECURITIES
MARCH 31, 1996 (UNAUDITED)

<TABLE>
<CAPTION>
Market
Principal Value
(000) (000)
=======================================================================================
<S> <C> <C>
COMMERCIAL PAPER - 99.4%
DOMESTIC - 95.4%
Air Products & Chemicals, Inc., 5.37%, 5/9/96 $200 $ 199
Albertson's, Inc., 5.2%, 4/18/96 200 199
American Express Credit Corp., 5.16%, 4/30/96 200 200
Ameritech Corp., 5.13%, 4/29/96 200 199
AT&T Corp., 5.15%, 5/14/96 200 199
Bass Finance, 5.15%, 5/7/96 200 199
BellSouth Telecommunications, Inc., 5.18%, 4/11/96 200 200
Deere (John) Capital Corp., 5.15%, 4/25/96 200 200
Dun & Bradstreet Corp., 5.18%, 4/23/96 200 199
du Pont (E.I.) de Nemours & Co., 5.15%, 4/19/96 200 199
Ford Motor Credit Co., 5.15%, 5/8/96 200 200
General Electric Capital Corp., 5.16%, 5/2/96 200 200
Heinz (H. J.) Co., 5.2%, 4/4/96 200 200
Hewlett-Packard Co., 5.13%, 4/26/96 200 198
Household Finance Corp., 5.15%, 5/3/96 200 200
Minnesota Mining & Mfg. Co., 5.18%, 4/1/96 200 200
Monsanto Co., 5.22%, 4/12/96 200 200
Northern States Power Co. (Minn), 5.2%, 4/12/96 200 200
PHH Corp., 5.22%, 4/4/96 200 200
Philip Morris Companies, Inc., 5.12%, 5/16/96 200 199
Pitney Bowes Credit Corp., 5.1%, 5/6/96 200 199
Toys 'R' Us, Inc., 5.23%, 4/2/96 200 200
Xerox Corp., 5.2%, 4/10/96 200 200
U. S. West Communications, Inc., 5.15%, 5/17/96 200 199
-------
4,788
-------
FOREIGN - 4.0%
Canadian Wheat Board, 5.05%, 5/24/96 200 199
-------

TOTAL INVESTMENT IN SECURITIES - 99.4%
(Total Cost - $4,986,994) 4,987
Cash and Other Assets, Less Liabilities - 0.6% 32
-------

NET ASSETS - 100.0%
(equivalent to $1.00 per share based on
5,019,015 shares outstanding) $ 5,019
=======
</TABLE>

The Notes to Financial Statements are an integral part of these statements.

<PAGE>

<TABLE>
<CAPTION>
CIGNA VARIABLE PRODUCTS MONEY MARKET FUND

STATEMENT OF ASSETS AND LIABILITIES (IN THOUSANDS)
MARCH 31, 1996 (UNAUDITED)

<S> <C>
ASSETS:
Investments in securities at value (Cost - $4,986,99 $4,987
Cash 31
Interest receivable 4
Receivable from advisor 3
------------
Total assets 5,025
============

LIABILITIES:
Dividends payable 2
Other accrued expenses 4
------------
Total liabilities 6
============

NET ASSETS $5,019
============

Shares outstanding 5,019
============

NET ASSET VALUE PER SHARE $1.00
============

COMPONENTS OF NET ASSETS:
Capital paid in $5,019
Undistributed net investment income 0
Accumulated net realized gain on investments 0
Unrealized appreciation of investments 0
------------

NET ASSETS $5,019
============
</TABLE>

The Notes to Financial Statements are an integral part of these statements.

<PAGE>

<TABLE>
<CAPTION>
CIGNA VARIABLE PRODUCTS MONEY MARKET FUND

STATEMENT OF OPERATIONS (IN THOUSANDS)
FOR THE PERIOD MARCH 1, 1996 (COMMENCEMENT OF
OPERATIONS) TO MARCH 31, 1996 (UNAUDITED)

INVESTMENT INCOME
INCOME:
<S> <C>
Interest $ 22
---------

EXPENSES:
Investment advisory fees 1
Custodian fees and expenses 1
Administrative services 1
Other 1
---------

Total expenses 4
Less expenses waived by advisor (3)
---------

Net Expenses 1
---------

NET INVESTMENT INCOME 21

REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain from securities transactions 0
Unrealized appreciation of investments 0
---------

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS 0
---------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 21
=========
</TABLE>

The Notes to Financial Statements are an integral part of these statements.

<PAGE>

<TABLE>
<CAPTION>
CIGNA VARIABLE PRODUCTS MONEY MARKET FUND

STATEMENT OF CHANGES IN NET ASSETS (IN THOUSANDS)
FOR THE PERIOD MARCH 1, 1996 (COMMENCEMENT OF
OPERATIONS) TO MARCH 31, 1996 (UNAUDITED)

<S> <C>
OPERATIONS:
Net investment income $ 21
Net realized gain from securities transactions 0
Unrealized appreciation of investments 0
---------

Net increase in net assets from operations 21
---------

DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (21)
From capital gains 0
---------
(21)

Capital Share Transactions:
Net proceeds from sales of shares 5,000
Net asset value of shares issued to shareholders
in reinvestment of dividends and distributions 19
---------

5,019
Cost of shares redeemed 0
---------

Net increase from Fund share transactions 5,019
---------

NET INCREASE IN NET ASSETS 5,019
NET ASSETS:
Beginning of period 0
---------

End of period $ 5,019
=========

TRANSACTIONS IN CAPITAL STOCK:
Shares sold 5,000
Shares issued in reinvestment of dividends and distr 19
---------

5,019
Shares redeemed 0
---------

Net increase 5,019
=========
</TABLE>

The Notes to Financial Statements are an integral part of these statements.

<PAGE>

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

1. SIGNIFICANT ACCOUNTING POLICIES. CIGNA Variable Products Money Market Fund is
a separate series of CIGNA Variable Products Group, a Massachusetts business
trust (the "Trust"). The Trust is registered under the Investment Company Act of
1940, as amended, as a diversified, open-end management investment company. The
objective of the Fund is to provide as high a level of current income as is
consistent with the preservation of capital and liquidity and the maintenance of
a stable $1.00 per share net asset value by investing in short-term money market
instruments. The preparation of financial statements in accordance with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results could differ from those estimates. The
following is a summary of significant accounting policies consistently followed
by the Fund in the preparation of financial statements.

A. SECURITY VALUATION -- The investments in the Fund are valued at amortized
cost, which the Board of Trustees has determined constitutes fair value and
which at March 31, 1996 approximates cost for Federal income tax purposes.

B. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME -- Security transactions
are accounted for on the trade date (date the order to buy or sell is executed).
Interest income is recorded on the accrual basis. Securities gains and losses
are determined on the basis of identified cost. The cost for Federal income tax
purposes is substantially the same.

C. FEDERAL TAXES -- For Federal income tax purposes, the Fund is taxed as a
separate entity. Its policy is to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its taxable income and capital gains to its shareholders. Therefore, no
Federal income or excise taxes on realized income or net capital gains have been
accrued.

D. DIVIDENDS -- Dividends from net investment income and net realized gains are
declared and reinvested daily. Dividends and distributions are recorded by the
Fund on the ex-dividend date. The timing and characterization of certain income
and capital gains distributions are determined in accordance with federal tax
regulations which may differ from generally accepted accounting principles. To
the extent that such differences are permanent, a re-class to paid in capital
may be required.

2. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES. Investment
advisory fees were paid or accrued to CIGNA Investments, Inc. ("CII"), certain
officers and directors of which are affiliated with the Funds. Such advisory
fees are based on an annual rate of 0.35% applied to the average daily net
assets of each Fund. CII has voluntarily agreed to reimburse the Fund for any
amount by which its expenses (including the advisory fee but excluding interest,
taxes, amortized organization expenses, transaction costs incurred in acquiring
and disposing of portfolio securities, and extraordinary expenses) exceed 0.50%
of average daily net assets.

<PAGE>

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(Continued)

The Fund reimburses CII for a portion of the compensation and related expenses
of the Trust's Treasurer and Secretary and certain persons who assist in
carrying out the responsibilities of those offices. For the period March 31,
1996, the Fund paid $1,001.

CII is an indirect, wholly-owned subsidiary of CIGNA Corporation.

3. TRUSTEES' FEES. Trustees' fees represent remuneration paid or accrued to
trustees who are not employees of CIGNA Corporation or any of their affiliates.
Trustees may elect to defer all or a portion of their fees which are invested in
mutual fund shares in accordance with a deferred compensation plan.

4. CAPITAL STOCK. The Fund is a separate series of the Trust which offers an
unlimited number of shares of beneficial interest, without par value. Other
than reinvestment of dividends, the only transaction in Capital Stock for the
period ended March 31, 1996 was the purchase of 5,000,000 shares at $1.00 on
March 1, 1996, commencement of operations, by Connecticut General Life Insurance
Company ("CG Life"), sole shareholder of the Fund.

<PAGE>

CIGNA VARIABLE PRODUCTS MONEY MARKET FUND NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(Continued)

5. FINANCIAL HIGHLIGHTS. The following selected per share data is computed on
the basis of a share outstanding throughout the period:

<TABLE>
<CAPTION>
March 1, 1996* to
March 31, 1996
<S> <C>
Net asset value, beginning of period $1.0000

Income from investment operations

Net investment income 0.0040

Net realized and unrealized gains 0.0000
-------

Less: Distributions

Dividends from net investment income (0.0040)

Dividends from capital gains 0.0000
-------

Total distributions (0.0040)
-------

Net asset value, end of period $1.0000
=======

Total return 0.40%**

Ratios and Supplemental Data:

Net assets, end of period (000) $5,019

Ratio of expenses to average net assets 0.04%***

Ratio of net investment income to average net assets 0.40%**

Portfolio turnover n/a
</TABLE>

* Commencement of operations.
** 4.74% annualized. Total return and ratio of net investment income to average
net assets prior to reimbursement of expenses was 0.36% (4.30% annualized).
*** 0.50% annualized. Ratio of expenses to average net assets prior to
reimbursement of expenses was 0.08% (0.94% annualized).

<PAGE>

REGISTRATION STATEMENT
on
FORM N-1A

PART C: OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS.
- -------------------------------------------

(a) Financial Statements:

PART A:

None

PART B:

The following Financial Statements of CIGNA Variable Products S&P 500 Index
Fund (f/k/a Companion Fund) are incorporated by reference to Part B from
the Annual Report to Shareholders of CG Variable Annuity Accounts I and II
dated December 31, 1995 and filed with the Securities and Exchange
Commission on March 5, 1996:

Investments in Securities, December 31, 1995
Statement of Assets and Liabilities, December 31, 1995
Statement of Operations, Year ended December 31, 1995
Statement of Changes in Net Assets, Years ended December 31, 1995 and
1994
Notes to Financial Statements

(b) Exhibits

*(1) The First Amended and Restated Master Trust Agreement of Registrant
dated as of March 1, 1996, incorporated by reference to Post-
Effective Amendment No. 11 to Registrant's Registration Statement
filed electronically March 7, 1996.

(2) The By-Laws of Registrant, incorporated by reference to Registrant's
initial Registration Statement filed February 26, 1988.

(2a) Amendment No. 1 to By-Laws of CIGNA Variable Products Group dated as
of October 25, 1988, incorporated by reference to Post-Effective
Amendment No. 7 to Registrant's Registration Statement filed March 1,
1994.

(2b) Amendment No. 2 to By-Laws of CIGNA Variable Products Group dated as
of October 27, 1992, incorporated by reference to Post-Effective
Amendment No. 7 to Registrant's Registration Statement filed March 1,
1994.

(2c) Amendment No. 3 to By-Laws of CIGNA Variable Products Group dated as
of February 11, 1994, incorporated by reference to Post-Effective
Amendment No. 7 to Registrant's Registration Statement filed March 1,
1994.

(3) None.

- 1 -
<PAGE>

(4) Relative to the rights of shareholders, Article IV and Article V of
Registrant's First Amended and Restated Master Trust Agreement dated
as of March 1, 1996, incorporated by reference to Post-Effective
Amendment No. 11 to Registrant's Registration Statement filed
electronically March 7, 1996.

(4a) Relative to the rights of shareholders, the Participation Agreement
among CIGNA Variable Products Group, CIGNA Financial Advisors, Inc.
and Connecticut General Life Insurance Company dated as of February
27, 1996, as hereinafter filed as Exhibit (9d).

(5) The Master Investment Advisory Agreement dated as of April 26, 1988
between CIGNA Variable Products Group and CIGNA Investments, Inc.,
incorporated by reference to Pre-Effective Amendment No. 1 to
Registrant's Registration Statement filed April 28, 1988.

(5a) The Side Letter to the Master Investment Advisory Agreement dated as
of November 9, 1995 between CIGNA Variable Products Group and CIGNA
Investments, Inc., incorporated by reference to Post-Effective
Amendment No. 11 to Registrant's Registration Statement filed
electronically March 7, 1996.

* (5b) Form of Side Letter to the Master Investment Advisory Agreement
between CIGNA Variable Products Group and CIGNA Investments,
Inc.

* (5c) The Sub-Advisory Agreement dated as of October 24, 1995 between
CIGNA Investments, Inc. and CIGNA International Investment Advisors,
Ltd. with respect to CIGNA Variable Products International Stock
Fund, a series of shares of Registrant.

(6) None.

(7) None.

(8) The Custodian Contract dated as of April 15, 1988 between CIGNA
Variable Products Group and State Street Bank and Trust Company,
incorporated by reference to Pre-Effective Amendment No. 1 to
Registrant's Registration Statement filed April 28, 1988.

(8a) The Side Letter to the Custodian Contract dated as of February 15,
1996 between CIGNA Variable Products Group and State Street Bank and
Trust Company, incorporated by reference to Post-Effective Amendment
No. 11 to Registrant's Registration Statement filed electronically
March 7, 1996.

(9) The Transfer Agency and Service Agreement dated as of April 15, 1988
between CIGNA Variable Products Group and State Street Bank and Trust
Company, incorporated by reference to Pre-Effective Amendment No. 1
to Registrant's Registration Statement filed April 28, 1988.

(9a) The Side Letter to the Transfer Agency and Service Agreement dated as
of February 15, 1996 between CIGNA Variable Products Group and State
Street Bank and Trust Company, incorporated by reference to Post-
Effective Amendment No. 11 to Registrant's Registration Statement
filed electronically March 7, 1996.

(9b) The Agreement For Use Of The Term "CIGNA" dated February 4, 1988
between CIGNA Variable Products Group and CIGNA Corporation,
incorporated by reference to Pre-Effective Amendment No. 1 to

- 2 -
<PAGE>

Registrant's Registration Statement filed April 28, 1988.

(9c) Form of Trustees' Deferred Fee Agreement, incorporated by reference
to Post-Effective Amendment No. 9 to Registrant's Registration
Statement filed electronically October 16, 1995.

* (9d) The Participation Agreement among CIGNA Variable Products
Group, CIGNA Financial Advisors, Inc. and Connecticut General Life
Insurance Company dated as of February 27, 1996.

* (10) Consent and opinion of Counsel.

* (11) Consent of Price Waterhouse LLP.

(12) None.

(13) None.

(14) None.

(15) None.

(16) None.

* *(17) Financial Data Schedule.

(18) None.

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
- -----------------------------------------------------------------------

As of the date hereof, no person is directly controlled by CIGNA Variable
Products Group. All of the outstanding shares of CIGNA Variable Products Money
Market Fund and CIGNA Variable Products S&P 500 Index Fund, series of shares of
CIGNA Variable Products Group, are owned by Connecticut General Life Insurance
Company, a Connecticut Corporation, for the benefit of variable annuity and/or
variable life insurance contractholders.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES.
- -----------------------------------------

As of April 1, 1996:

(1)
Title of Class: Shares of Beneficial Interest

(2)

<TABLE>
<CAPTION>
Name of Series Number of Record Holders
- -------------- ------------------------
<S> <C>
CIGNA Variable Products High Yield Fund -0-
CIGNA Variable Products Income Fund -0-
</TABLE>

______________________

*Filed Herewith

- 3 -
<PAGE>

<TABLE>
<S> <C>
CIGNA Variable Products International Stock Fund -0-
CIGNA Variable Products Money Market Fund -1-
CIGNA Variable Products S&P 500 Index Fund -1-
</TABLE>

_________________________________________

ITEM 27. INDEMNIFICATION.
- -------------------------

The First Amended and Restated Master Trust Agreement, dated as of March 1, 1996
(the "Master Trust Agreement"), provides, among other things, for the
indemnification out of Registrant's assets (or the assets of a series of
Registrant where applicable) of the Trustees and officers of Registrant against
all liabilities incurred by them in such capacity, except for liability by
reason of wilful misfeasance, bad faith, gross negligence or reckless disregard
of their duties. Trustees may consult counsel or other experts concerning the
meaning and operation of the Master Trust Agreement, and may rely upon the books
and records of Registrant. Trustees are not liable for errors of judgment,
mistakes of fact or law, or for the negligence of other Trustees or Registrant's
officers or agents.

Trustees are not required to give a bond or other security for the performance
of their duties. Payments in compromise of any action brought against a Trustee
or officer may be paid by Registrant if approved by either a majority of
disinterested Trustees or by independent legal counsel. The right of
indemnification under the Master Trust Agreement is not exclusive of any other
rights to which the Trustees or officers may be entitled.

The Master Trust Agreement also provides that shareholders shall be indemnified
and held harmless by the applicable series of Registrant with respect to actions
brought against them in their capacity as shareholders. Also, the Master Trust
Agreement provides that creditors of a series of Registrant may look only to the
assets of that series for payment; and neither shareholders nor Trustees shall
be personally liable therefor. All instruments executed on behalf of Registrant
are required to contain a statement to the effect of the foregoing.

CIGNA Investments, Inc., Registrant and other investment companies managed by
CIGNA Investments, Inc., their officers, trustees, directors and employees (the
"Insured Parties") are insured under an Investment Management Errors and
Omissions Insurance Policy in the amount of $10,000,000 offered by Lexington
Insurance Company, an affiliate of American International Group on a joint
policy basis with CIGNA Investments, Inc. and CIGNA International Investment
Advisors, Ltd.

In addition, Registrant and other investment companies managed by CIGNA
Investments, Inc. and CIGNA International Investment Advisors, Ltd. are insured
under a National Union Fire Insurance Company of Pittsburgh, PA Investment
Company Blanket Bond with a stated maximum coverage of $10,000,000. Premiums
and policy benefits are allocated among participating companies pursuant to Rule
17g-1(d) under the Investment Company Act of 1940, as amended.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.
- --------------------------------------------------------------

As of the date hereof, CIGNA Investments, Inc. ("CII") serves as investment
adviser to seven series of shares of CIGNA Funds Group (f/k/a as CIGNA Annuity
Funds Group) known as CIGNA Income Fund (f/k/a CIGNA Annuity Income Fund),
CIGNA Money Market Fund (f/k/a CIGNA Annuity Money Market Fund),

- 4 -
<PAGE>

CIGNA Government Obligations Cash Fund, CIGNA Government Securities Fund, CIGNA
High Yield Fund, CIGNA S&P 500 Index Fund and CIGNA Treasury Obligations Cash
Fund; to CIGNA Institutional Funds Group and its series of shares known as CIGNA
International Stock Fund; to CIGNA Variable Products Group and its five series
of shares known as CIGNA Variable Products High Yield Fund, CIGNA Variable
Products Income Fund, CIGNA Variable Products International Stock Fund, CIGNA
Variable Products Money Market Fund and CIGNA Variable Products S&P 500 Index
Fund (f/k/a Companion Fund), three of such series being inactive at this time,
namely, CIGNA Variable Products High Yield Fund, CIGNA Variable Products Income
Fund and CIGNA Variable Products International Stock Fund; and to CIGNA High
Income Shares (CIGNA Funds Group (f/k/a CIGNA Annuity Funds Group), CIGNA
Institutional Funds Group, CIGNA High Income Shares and CIGNA Variable Products
Group known collectively as the "Trusts"); and INA Investment Securities, Inc.
("IIS"), all of which (except for IIS and CIGNA High Income Shares) are open-end
investment companies, and to certain other companies, most of which are
affiliated with CIGNA Corporation. For a description of the business of CII, see
its most recent Form ADV (File No. 801-18094) filed with the Securities and
Exchange Commission. The principal business address of each of the foregoing
companies is as follows:

CII - 900 Cottage Grove Road, Bloomfield, Connecticut 06002

The Trusts and each of their series of shares - 1380 Main Street,
Springfield, Massachusetts 01103

IIS - Two Liberty Place, 1601 Chestnut Street, Philadelphia, Pennsylvania
19192

Substantial business and other connections of the Directors and officers of CII
during the past two fiscal years are listed below:

<TABLE>
<CAPTION>
Names of Officers and Directors Positions with the Adviser and
of the Investment Adviser Other Business Connections
- ------------------------------- ---------------------------------------------
<S> <C>
Harold W. Albert Director and Counsel, CII; Director, CIGNA
International Investment Advisors, Ltd.**;
Chief Counsel, CIGNA Investment Management, a
division of CIGNA Corporation*; Counsel,
CIGNA Investment Advisory Company, Inc.*;
Director, Senior Vice President and Chief
Counsel, CIGNA Investment Group, Inc.*;
Director, Connecticut General Pension
Services, Inc.*

Robert W. Burgess Director, CII and CIGNA International
Investment Advisors, Ltd.**; Chief Financial
Officer, CIGNA Investment Management, a
division of CIGNA Corporation*; Director and
Senior Vice President, CIGNA Investment
Group, Inc.*; Director, Connecticut General
Pension Services, Inc.*
</TABLE>

- 5 -
<PAGE>

<TABLE>
<CAPTION>
Names of Officers and Directors Positions with the Adviser and
of the Investment Adviser Other Business Connections
- ------------------------------- ------------------------------
<S> <C>
Arthur C. Reeds, III President and Chief Investment Officer, CIGNA
Investment Management, a division of CIGNA
Corporation*; President and Director, CII and
CIGNA Investment Group, Inc.*; President,
CIGNA Investment Advisory Company, Inc.*;
Director, CIGNA International Investment
Advisors, Ltd.** and Connecticut General
Pension Services, Inc.*; Trustee, the Trusts;
Director, IIS.

R. Bruce Albro Senior Managing Director, CII; Director and
Senior Managing Director, CIGNA Investment
Advisory Company, Inc.*; Director,
Connecticut General Pension Services, Inc.*;
Chairman of the Board, President and Trustee,
the Trusts; Chairman of the Board, President
and Director, IIS.

Mary Louise Casey Senior Managing Director, CII and CIGNA
International Investment Advisors, Ltd.**

Richard H. Forde Senior Managing Director, CII and CIGNA
Investment Advisory Company, Inc.*;
President, Senior Managing Director and
Director, CIGNA International Investment
Advisors, Ltd.**; Vice President, CIGNA
Institutional Funds Group.

Edward F. Guay Senior Managing Director and Chief Economist,
CII; Senior Managing Director, CIGNA
Investment Advisory Company, Inc.*;
previously, Managing Director, CII and CIGNA
Investment Advisory Company, Inc.*

Lawrence S. Harris Senior Managing Director, CII and CIGNA
Investment Advisory Company, Inc.*; Vice
President, CIGNA Annuity Funds Group, CIGNA
High Income Shares, CIGNA Variable Products
Group and IIS.

Malcolm S. Smith Senior Managing Director, CII; Director and
Senior Managing Director, CIGNA Investment
Advisory Company, Inc.*

Philip J. Ward Senior Managing Director, CII; Director and
Senior Managing Director, CIGNA Investment
Advisory Company, Inc.*

J. Robert Andrews Managing Director, CII.

Julia B. Bazenas Managing Director, CII; previously Vice
President, CII.

Mark E. Benoit Managing Director, CII; previously Vice
President, CII.

Susan B. Bosworth Managing Director, CII.
</TABLE>

- 6 -
<PAGE>

Richard H. Chase Managing Director, CII; previously Vice
President, CII.

Rosemary C. Clarke Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

James F. Coggins, Jr. Managing Director, CII.

Dorothy Cunningham Managing Director, CII; previously Vice
President, CII.

Robert F. DeLucia Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*; Director,
Connecticut General Pension Services, Inc.*

Lawrence A. Drake Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

Denise T. Duffee Managing Director, CII.

John G. Eisele Managing Director, CII; previously Vice
President, CII.

Robert Fair Managing Director, CII; previously Vice
President, CII.

John P. Feeney Managing Director, CII; previously Vice
President, CII.

Thomas R. Foley Managing Director, CII; previously Vice
President, CII.

Maurice A. Gordon Managing Director, CII; previously Vice
President, CII.

Debra J. Height Managing Director, CII.

Chris W. Jacobs Managing Director, CII.

David R. Johnson Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

Richard H. Kupchunos Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

James R. Kuzemchak Managing Director, CII.

David A. Leone Managing Director, CII.

Edward Lewis Managing Director, CII.

Timothy J. Lord Managing Director, CII.

Thomas P. Mahoney Managing Director, CII.
</TABLE>

- 7 -
<PAGE>

Bret E. Meck Managing Director, CII; previously Vice
President, CII.

Stephen J. Olstein Managing Director, CII.

Stephen A. Osborn Managing Director, CII.

Alan C. Petersen Managing Director, CII; Vice President, CIGNA
High Income Shares.

Robert E. Peterson Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

Anthony J. Pierson Managing Director, CII.

Leon Pouncy Managing Director, CII; previously Vice
President, CII.

Donald F. Rieger, Jr. Managing Director, CII.

James H. Rogers Managing Director, CII; previously Vice
President, CII.

Frank Sataline, Jr. Managing Director, CII; previously Vice
President, CII.

James G. Schelling Managing Director, CII.

Linda W. Schumann Managing Director, CII.

John A. Shaw Managing Director, CII; previously Vice
President, CII.

Thomas M. Smith Managing Director, CII; previously Vice
President, CII.

Joseph W. Springman Managing Director, CII and CIGNA Investment
Advisory Company, Inc.*

Susan S. Sullivan Managing Director, CII.

William A. Taylor Managing Director, CII; previously Vice
President, CII.

George Varga Managing Director, CII; previously Vice
President, CII.

Deborah B. Wiacek Managing Director, CII; previously Vice
President, CII.

Stephen H. Wilson Managing Director, CII.

James A. White Senior Vice President, CII and CIGNA
Investment Advisory Company, Inc.*
</TABLE>

- 8 -
<PAGE>

<TABLE>
<CAPTION>
Names of Officers and Directors Positions with the Adviser and
of the Investment Adviser Other Business Connections
- ------------------------------- ------------------------------
<S> <C>
Barry L. Adams Vice President, CII, CIGNA Investment
Advisory Company, Inc.*, CIGNA Investment
Group, Inc.*, CIGNA International Investment
Advisors, Ltd.** and Connecticut General
Pension Services, Inc.*

Jean M. Anderson Vice President, CII.

Paul A. Bankson Vice President, CII; previously Vice
President, Connecticut General Pension
Services, Inc.*

Paul Bergsteinsson Vice President, CII, CIGNA Investment
Advisory Company Inc.*, CIGNA Investment
Group, Inc.*, CIGNA International Investment
Advisors, Ltd.** and Connecticut General
Pension Services, Inc.*

Marcy F. Blender Vice President, CII, CIGNA Investment
Advisory Company, Inc.*, CIGNA Investment
Group, Inc.* and Connecticut General Pension
Services, Inc.*; previously Treasurer, CIGNA
Investment Group, Inc.* and Connecticut
General Pension Services, Inc.*; Vice
President and Treasurer, CIGNA International
Investment Advisors, Ltd.**

Marguerite A. Boslaugh Vice President, CII.

William C. Carlson Vice President, CII.

Antonio M. Caxide Vice President, CII and CIGNA International
Investment Advisors, Ltd.**

Rosemary S. Cleaves Vice President, CII; President and Director,
Connecticut General Pension Services, Inc.*

Thomas R. Clemmenson Vice President, CII.

Nancy M. Corrigan Vice President, CII.

Lee P. Crockett Vice President, CII.

Michael P. Daly Vice President, CII; previously Economist,
CII.

Maryanne P. DePreaux Vice President, CII.

Mark V. DePucchio Vice President, CII.

Eric C. DiMiceli Vice President, CII.

Celia R. Dondes Vice President, CII.

Michael Q. Doyle Vice President, CII.

Ronald J. Dupont Vice President, CII and CIGNA Investment
Advisory Company, Inc.*
</TABLE>

- 9 -
<PAGE>

Mark W. Everette Vice President, CII.

Richard L. Fletcher Vice President, CII.

Jonathan S. Frankel Vice President, CII.

Ivy B. Freedman Vice President, CII.

Keith A. Gollenberg Vice President, CII.

William J. Grady Vice President, CII.

Mark R. Harrison Vice President, CII.

Debra J. Height Vice President, CII and CIGNA Investment
Advisory Company, Inc.*

John Hurley Vice President, CII.

Chuel D. Hwang Vice President, CII.

Edward B. Johns Vice President, CII.

Thomas W. Johnson Vice President, CII.

Patricia F. Judd Vice President, CII.

Joseph R. Kennedy Vice President, CII.

Peter K. Kofoed Vice President, CII.

Mark S. Korinek Vice President, CII.

James R. Lagasse Vice President, CII.

Mary S. Law Vice President, CII.

Paul T. Martin Vice President, CII.

Joseph G. Mazon Vice President, CII.

Daniel McDonough Vice President, CII.

Linda L. Morel Vice President, CII.

Stephen J. Myott Vice President, CII.

Alpha O. Nicholson, III Vice President, CII.

Donald E. Norton Vice President, CII.
</TABLE>

- 10 -
<PAGE>

Pamela S. Peck Vice President, CII.

Elisabeth A. Perenick Vice President, CII.

Myrna Phillips Vice President, CII.

Scott S. Piccone Vice President, CII.

Elisabeth Piker Vice President, CII.

Geoffrey R. Plume Vice President, CII.

Thomas J. Podgorski Vice President, CII.

Suresh Raghaven Vice President, CII.

Michael J. Riccio Vice President, CII.

Stephen L. Roberts Vice President, CII.

Timothy F. Roberts Vice President and Compliance Officer, CII;
Vice President, International Finance/Global
Compliance, CIGNA Investment Management, a
division of CIGNA Corporation*; Vice
President - Finance and Compliance Officer,
CIGNA International Investment Advisors,
Ltd.**; Compliance Officer, CIGNA Investment
Advisory Company, Inc.*

Peter F. Roby Vice President, CII.

Alexander Rybchinsky Vice President, CII.

Annette Sanders Vice President, CII.

David S. Scheibe Vice President, CII; previously Assistant
Vice President and Controller, CII.

John R. Schumann Vice President, CII.

Thomas P. Shea, III Vice President, CII.

Philip Spak Vice President, CII.
</TABLE>

- 11 -
<PAGE>

<TABLE>
<CAPTION>
Names of Officers and Directors Positions with the Adviser and
of the Investment Adviser Other Business Connections
- ------------------------------- ------------------------------
<S> <C>
Stephen C. Stachelek Vice President, CII and CIGNA Investment
Advisory Company, Inc.*; Vice President and
Treasurer, CIGNA Investment Group, Inc.* and
Connecticut General Pension Services, Inc.*;
Treasurer, CIGNA International Investment
Advisors, Ltd.**

Carlton C. Taylor Vice President, CII.

Patrick H. Thompson Vice President, CII.

Ruth D. VanWinkle Vice President, CII and CIGNA Investment
Advisory Company, Inc.*

Victor J. Visockis, Jr. Vice President, CII.

Henry C. Wagner, III Vice President, CII and CIGNA Investment
Advisory Company, Inc.*; Portfolio Manager,
CIGNA Variable Products S&P 500 Index Fund, a
series of CIGNA Variable Products Group.

William Weissenburger, Jr. Vice President, CII; Assistant Vice
President, Connecticut General Pension
Services, Inc.*

Carey A. White Vice President, CII.

William S. Woodsome Vice President, CII.

Alfred A. Bingham III Assistant Vice President, CII; Vice President
and Treasurer, the Trusts and IIS.

David C. Kopp Secretary, CII, CIGNA Investment Advisory
Corporation*, CIGNA International Investment
Advisors, Ltd.**, CIGNA Investment Group,
Inc.*, Connecticut General Pension Services,
Inc.* and CIGNA Financial Advisors, Inc.*;
Assistant General Counsel and Assistant
Corporate Secretary, CIGNA Corporation*;
Corporate Secretary, Connecticut General Life
Insurance Company.*
</TABLE>

CIGNA International Investment Advisors, Ltd. ("CIIA") serves as sub-adviser to
CIGNA Variable Products International Stock Fund, a series of shares of
Registrant. CIIA is an indirect, wholly-owned subsidiary of CIGNA Corporation
and an affiliate of CII. The principal address of CIIA is Park House, 7th
Floor, 16 Finsbury Circus, London EC2M 7AX, England.

Substantial business and other connections of the Directors and officers of CIIA
during the past two fiscal years are listed below:

- 12 -
<PAGE>

<TABLE>
<S> <C>
division of CIGNA Corporation*; Counsel,
CIGNA Investment Advisory Company, Inc.*;
Director, Senior Vice President and Chief
Counsel, CIGNA Investment Group, Inc.*;
Director, Connecticut General Pension
Services, Inc.*

Robert W. Burgess Director, CIIA and CII*; Chief Financial
Officer, CIGNA Investment Management, a
division of CIGNA Corporation*; Director and
Senior Vice President, CIGNA Investment
Group, Inc.*; Director, Connecticut General
Pension Services, Inc.*

Richard H. Forde Director, President and Senior Managing
Director, CIIA; Senior Managing Director,
CII* and CIGNA Investment Advisory Company,
Inc.*; Vice President, CIGNA Institutional
Funds Group.

Arthur C. Reeds, III Director, CIIA and Connecticut General
Pension Services, Inc.*; President and Chief
Investment Officer, CIGNA Investment
Management, a division of CIGNA Corporation*;
President and Director, CII and CIGNA
Investment Group, Inc.*; President, CIGNA
Investment Advisory Company, Inc.*; Trustee,
the Trusts; Director, IIS.

John Townley Director, Resident Director and Division
Head - International Systems, CIIA;
previously Administrative Head - London
Office, CIIA.

Barry L. Adams Vice President and Assistant Treasurer, CIIA,
CII*, CIGNA Investment Advisory Company,
Inc.*, CIGNA Investment Group, Inc.* and
Connecticut General Pension Services, Inc.*

Paul Bergsteinsson Vice President and Assistant Treasurer, CIIA,
CII*, CIGNA Investment Group, Inc.*, CIGNA
Investment Advisory Company, Inc.* and
Connecticut General Pension Services, Inc.*

Antonio M. Caxide Vice President, CIIA and CII.*

Matthew P. Hutchinson Vice President, CIIA; previously, Fund
Manager, CIIA.

Daniel McDonough Vice President, CIIA and CII.*

Lee C. Mickelburough Vice President, CIIA.

Timothy F. Roberts Vice President - Finance and Chief Compliance
Officer, CIIA; Vice President, International
Finance/Global Compliance, CIGNA Investment
Management, a division of CIGNA Corporation*;
Vice President and Compliance Officer, CII*;
Compliance Officer, CIGNA Investment Advisory
Company, Inc.*
</TABLE>

- 13 -
<PAGE>

<TABLE>
<S> <C>
Flora Kong Financial Controller, CIIA.

Joel W. Messing Counsel, CIIA.

David C. Kopp Secretary, CIIA, CII*, CIGNA Investment
Advisory Corporation*, CIGNA Investment
Group, Inc.*, Connecticut General Pension
Services, Inc.* and CIGNA Financial Advisors,
Inc.*; Assistant General Counsel and
Assistant Corporate Secretary, CIGNA
Corporation*; Corporate Secretary,
Connecticut General Life Insurance Company.*
</TABLE>

ITEM 29. PRINCIPAL UNDERWRITERS.
- --------------------------------

Registrant has no principal underwriter. CIGNA Financial Advisors, Inc., an
indirect, wholly-owned subsidiary of CIGNA Corporation, is the distributor of
variable annuity and variable life insurance contracts, the assets of which are
invested in CIGNA Variable Products Money Market Fund and CIGNA Variable
Products S&P 500 Index Fund (f/k/a Companion Fund).

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS.
- ------------------------------------------

Books or other documents required to be maintained by Section 31(a) of the
Investment Company Act of 1940 (15 U.S.C. 80a-30(a)) and the Rules (17 CFR
270.31a-1 to 31a-3) promulgated thereunder and records relating to shareholders
are maintained by State Street Bank and Trust Company, Boston, Massachusetts.
Registrant's corporate records and financial records are maintained c/o CIGNA
Investments, Inc., 900 Cottage Grove Road, Bloomfield, CT 06002.

________________________

* 900 Cottage Grove Road, Bloomfield, CT
** Park House, 16 Finsbury Circus, London, England

ITEM 31. MANAGEMENT SERVICES.
- -----------------------------

Not Applicable

ITEM 32. UNDERTAKINGS.
- ----------------------

(a) Not Applicable.

(b) Not Applicable.

(c) Registrant undertakes to furnish each person to whom a Prospectus is
delivered a copy upon request and without charge of Registrant's most
recent annual report to shareholders.

- 14 -
<PAGE>

- 15 -
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, Registrant, CIGNA Variable Products Group,
certifies that it meets all of the requirements for effectiveness of this
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933
and has duly caused this Amendment No. 12 to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Bloomfield, and State of Connecticut on the 22nd day of April, 1996.

CIGNA VARIABLE PRODUCTS GROUP

R. Bruce Albro
Chairman of the Board of Trustees
and President

By: /s/ Jeffrey S. Winer
-----------------------------
Jeffrey S. Winer
Attorney-in-Fact

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 12 to the Registration Statement has been signed below by the following
persons in the capacities and on the date indicated.

<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
R. Bruce Albro Chairman of April 22, 1996.
the Board of
Trustees and
President (principal
executive officer)
By: /s/ Jeffrey S. Winer
--------------------------------
Jeffrey S. Winer
Attorney-in-Fact

/s/ Alfred A. Bingham III
--------------------------------
Alfred A. Bingham III Treasurer April 22, 1996.
(principal
financial officer
and principal
accounting officer)
</TABLE>

This Amendment to the Registration Statement has also been signed below by
Jeffrey S. Winer, Attorney-in-Fact, on behalf of the following Trustees on the
date indicated, such Trustees being all of the Trustees currently holding the
office of Trustee of Registrant.

<TABLE>
<S> <C> <C>
R. Bruce Albro Paul J. McDonald
Hugh R. Beath Arthur C. Reeds, III
Russell H. Jones

By: /s/ Jeffrey S. Winer April 22, 1996.
--------------------------------
Jeffrey S. Winer
</TABLE>

<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

POWER OF ATTORNEY

The undersigned hereby appoint Alfred A. Bingham III and Jeffrey S. Winer, each
of them singly, attorney for me and in my name and on my behalf to sign any
Registration Statement under the Securities Act of 1933, any Registration
Statement under the Investment Company Act of 1940 or any filing under the
securities laws of any of the states of the United States of America or of any
jurisdiction ("Blue Sky Law") for CIGNA Variable Products Group, and any
amendment to any such Registration Statement or any Blue Sky Law filing to be
filed not later than June 30, 1996 with the Securities and Exchange Commission
under the Securities Act of 1933 and under the Investment Company Act of 1940 or
with the appropriate state agency under the applicable Blue Sky Laws, and
generally to do and perform all things necessary to be done in that connection,
hereby ratifying and confirming my signature as it may be signed by my said
attorney to any and all Registration Statements and to any and all Blue Sky Law
filings and amendments thereto.

Signed this 16th day of April, 1996.

/s/ R. Bruce Albro
---------------------------------------------
R. Bruce Albro,
Chairman of the Board and President, Trustee

/s/ Arthur C. Reeds, III
----------------------------------------------
Arthur C. Reeds, III, Trustee
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

POWER OF ATTORNEY

Signed this 20th day of April, 1996.

/s/ Hugh R. Beath
---------------------------------------
Hugh R. Beath, Trustee
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

POWER OF ATTORNEY

Signed this 17th day of April, 1996.

/s/ Russell H. Jones
---------------------------------------
Russell H. Jones, Trustee
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

POWER OF ATTORNEY

Signed this 17th day of April, 1996.

/s/ Paul J. McDonald
---------------------------------------
Paul J. McDonald, Trustee
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, Registrant, CIGNA Variable Products Group,
certifies that it meets all of the requirements for effectiveness of this
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933
and has duly caused this Amendment No. 13 to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Bloomfield, and State of Connecticut on the 29th day of April, 1996.

CIGNA VARIABLE PRODUCTS GROUP

R. Bruce Albro
Chairman of the Board of Trustees
and President

By: /s/ Jeffrey S. Winer
-----------------------------
Jeffrey S. Winer
Attorney-in-Fact

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 13 to the Registration Statement has been signed below by the following
persons in the capacities and on the date indicated.

<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
R. Bruce Albro Chairman of April 29, 1996.
the Board of
Trustees and
President (principal
executive officer)
By: /s/ Jeffrey S. Winer
--------------------------------
Jeffrey S. Winer
Attorney-in-Fact

/s/ Alfred A. Bingham III
--------------------------------
Alfred A. Bingham III Treasurer April 29, 1996.
(principal
financial officer
and principal
accounting officer)
</TABLE>

<TABLE>
<S> <C> <C>
R. Bruce Albro Paul J. McDonald
Hugh R. Beath Arthur C. Reeds, III
Russell H. Jones

By: /s/ Jeffrey S. Winer April 29, 1996.
--------------------------------
Jeffrey S. Winer
</TABLE>

<PAGE>

SECURITIES ACT FILE NO. 33-20333
INVESTMENT COMPANY ACT FILE NO. 811-5480

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

______
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
------
Pre-Effective Amendment No. ______

Post-Effective Amendment No. 13 X
------

______
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
------
Amendment No. 13 X
------

CIGNA VARIABLE PRODUCTS GROUP
(Exact Name of Registrant as Specified in Charter)

1380 Main Street, Springfield, MA 01103
(Address of Principal Executive Office)

EXHIBITS
<PAGE>

EXHIBIT INDEX

(b) Exhibits

* (5b) Form of Side Letter to the Master Investment Advisory Agreement
between CIGNA Variable Products Group and CIGNA Investments,
Inc.

* (5c) The Sub-Advisory Agreement dated as of October 24, 1995 between CIGNA
Investments, Inc. and CIGNA International Investment Advisors, Ltd.
with respect to CIGNA Variable Products International Stock Fund, a
series of shares of Registrant.

* (9d) The Participation Agreement among CIGNA Variable Products Group,
CIGNA Financial Advisors, Inc. and Connecticut General Life Insurance
Company dated as of February 27, 1996.

* (10) Consent and opinion of Counsel.

* (11) Consent of Price Waterhouse LLP.

* (17) Financial Data Schedule.

____________________________

*Filed herewith

<PAGE>

Exhibit (5b)
CIGNA VARIABLE PRODUCTS GROUP
1380 MAIN STREET
SPRINGFIELD, MA 01103

_______________, 1996

CIGNA Investments, Inc.
900 Cottage Grove Road
Bloomfield, CT 06002

Re: Master Investment Advisory Agreement Dated as of April 26, 1988 (the
"Agreement") Between CIGNA Investments, Inc. (the "Adviser") and CIGNA
Variable Products Group (the "Trust")

Dear Madam or Sir:

This is to confirm that the management fee for the series of the Trust known as
CIGNA Variable Products S&P 500 Index Fund (f/k/a Companion Fund) (the "Fund")
has been reduced effective January 1, 1996 from 0.35% of the average daily net
asset value of the Fund to 0.25% of the average daily net asset value of the
Fund. All other terms and conditions of the Agreement remain in full force and
effect.

Please indicate your agreement with the foregoing by signing below.

Copies of the Master Trust Agreement establishing the Trust are on file with the
Secretary of the Commonwealth of Massachusetts, and notice is hereby given that
this document is executed on behalf of the Trust by an officer of the Trust and
not individually and that any obligations of or arising out of this document are
not binding upon any of the Trustees, officers, shareholders, employees or
agents of the Trust individually, but are binding only upon the assets and
property of the Trust.

Sincerely,

CIGNA VARIABLE PRODUCTS GROUP

By:_____________________________________
By: R. Bruce Albro
Its: Chairman of the Board and President

Accepted and Agreed to this ______ day of _______________, 1996.

CIGNA INVESTMENTS, INC.

By:_______________________________________________
By: Arthur C. Reeds, III
Its: President

<PAGE>

Exhibit (5c)

SUB-ADVISORY AGREEMENT

AGREEMENT made as of the 24th day of October, 1995 between CIGNA
INVESTMENTS, INC., a corporation organized under the laws of the State of
Delaware and having its principal place of business in Bloomfield, Connecticut
(the "Adviser"), and CIGNA International Investment Advisors, Ltd., a
corporation organized under the laws of the State of Delaware having its
principal place of business in London, England (the "Sub-Adviser").

WHEREAS, CIGNA Variable Products Group (the "Trust") is an open-end
management investment company registered under the Investment Company Act of
1940 ( the "1940 Act"); and

WHEREAS, the Trust is establishing a new series of shares known as CIGNA
Variable Products International Stock Fund (the "Fund"); and

WHEREAS, the Adviser and the Sub-Adviser are each engaged in the business of
rendering investment management services and are registered under the Investment
Advisers Act of 1940;

NOW, THEREFORE, WITNESSETH: That it is hereby agreed between the parties
hereto as follows:

1.(a) The Sub-Adviser is hereby appointed to provide investment advisory
services to the Trust on behalf of the Fund for the period and on the terms
herein set forth, in accordance with the terms of the Master Trust Agreement of
the Trust as in effect from time to time (the "Trust Agreement"), the prospectus
and statement of additional information relating to the Fund, each as in effect
from time to time (referred to collectively as the "Prospectus"), and applicable
law. The Prospectus is hereby incorporated by reference. The Sub-Adviser
hereby accepts such appointment and agrees during such period, at its own
expense, to render the services and to assume the obligations herein set forth
for the compensation described in Schedule A hereto. Except as otherwise
provided by applicable law, the only restrictions on the amount of any one
investment, or on proportion of the Fund's portfolio which any one investment or
any particular kinds of investment may contribute, are set forth in this
Agreement and the Prospectus.

(b) The Sub-Adviser is a member of Investment Management Regulatory
Organisation Limited ("IMRO"), a self-regulatory organization, and is as such
regulated by IMRO in the conduct of its investment business. The Sub-Adviser
will provide services hereunder on the basis that CII is a "Non-private
customer" under the rules of IMRO. The disclosures set forth in Section 8
<PAGE>

are made a part of this Agreement in accordance with IMRO requirements.

2.(a) The Sub-Adviser shall have investment discretion with respect to such
portion of the Fund's assets as is specified from time-to-time by the Adviser
(the "Managed Assets"). The Sub-Adviser, at its expense, will furnish
continuously an investment program for the Fund with respect to the Managed
Assets, will determine, subject to the supervision of the Adviser and the Board
of Trustees of the Trust, what investments shall be purchased, held, sold or
exchanged by the Fund and what portion, if any, of the assets of the Fund shall
be held in cash, cash equivalents or other temporary investments and shall, on
behalf of the Fund, make changes in the Fund's investments. The Sub-Adviser
will advise the Fund's custodian and the Adviser on a prompt basis of each
purchase and sale of a portfolio security specifying the name of the issuer, the
description and amount or number of shares of the security purchased, the market
price, commission and gross or net price, trade date, settlement date and
identity of the effecting broker or dealer, together with such other information
as may be required by applicable law or regulation. From time to time as the
Trustees of the Trust or the Adviser may reasonably request, the Sub-Adviser
will furnish or cause to be furnished to the Trust's officers and to each of its
Trustees reports on portfolio transactions and reports on issues of securities
held in the portfolio, all at such times (but not less frequently than once
every twelve months or such shorter period as may from time to time be required
by applicable law) and in such detail as the Trustees or the Adviser may
reasonably request. For the purpose of such reports, the value of the
securities held in the Fund's portfolio will be calculated in accordance with
the procedures described in the Prospectus and statement of additional
information of the Fund. Notwithstanding the foregoing, the Sub-Adviser shall
upon the request of the Trustees, the Adviser, or the officers of the Trust,
supply or cause to be supplied reports which compare the performance of the Fund
with that of other mutual funds possessing similar investment objectives and
policies. The Sub-Adviser will also inform the Trust's officers and Trustees on
a current basis of changes in investment strategy or tactics and may from time
to time contact those persons in order to discuss the investments of the Fund.
The Sub-Adviser will make its officers and employees available to meet with the
Trust's officers and Trustees on due notice to review the investments and
investment program of the Fund in the light of current and prospective economic
and market conditions.

(b) The Sub-Adviser, at its own expense, shall place orders for the
purchase and sale of portfolio securities for the account of the Fund with
broker/dealers selected by the Sub-Adviser. The Sub-Adviser is authorized to
submit any such order collectively with orders on behalf of other accounts under
its management, provided that the Sub-Adviser shall have determined that such
action is in the best interest of the Fund
<PAGE>

and is in accordance with applicable law, including, without limitation, Rule
17d-1 under the 1940 Act. In executing portfolio transactions for the Fund and
selecting broker/dealers, the Sub-Adviser will use its best efforts to seek on
behalf of the Fund the best overall terms available.

In assessing the best overall terms available for any transaction, the Sub-
Adviser shall consider all factors it deems relevant, including the breadth of
the market in the security, the price of the security, the financial condition
and execution capability of the broker/dealer, and the reasonableness of the
commission, if any (for the specific transaction and on a continuing basis). In
evaluating the best overall terms available, and in selecting the broker/dealer
to execute a particular transaction, the Sub-Adviser may also consider the
brokerage and research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934) provided to the Fund and/or other accounts
over which the Sub-Adviser or an affiliate of the Sub-Adviser exercises
investment discretion. The Sub-Adviser is authorized to pay to a broker/dealer
who provides such brokerage and research services a commission for executing a
portfolio transaction for the Fund which is in excess of the amount of
commission another broker/dealer would have charged for effecting that
transaction if, but only if, the Sub-Adviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker/dealer viewed in terms of that particular
transaction or in terms of all of the accounts over which investment discretion
is so exercised. In the event that the Sub-Adviser wishes to enter into an
arrangement with any person pursuant to which it undertakes to place business
with such person or any of its associates or any other person at such person's
discretion in return for brokerage or research services provided by such person
to the Sub-Adviser, or enters into any other Soft Commission Arrangement as
defined by IMRO Rules as in effect from time to time, the Sub-Adviser will
identify to the Trust in writing each such broker/dealer, or other person and
the nature of such services and will obtain the consent of the Trust to the
placing of business with such broker/dealer. The Sub-Adviser will not, without
the Fund's prior consent, invest on behalf of the Fund in securities of which an
issue or offer for sale was underwritten, managed or arranged by the Sub-Adviser
or an associate of the Sub-Adviser during the preceding twelve months.

3. The Sub-Adviser agrees to hold the Trust harmless with respect to any
and all damages the Trust may sustain resulting from any dishonest act of any
employee or agent of the Sub-Adviser. This Paragraph 3 is in addition to, and
not by way of limitation of, any other rights of indemnification which the Trust
may have hereunder or otherwise.

(a) The Sub-Adviser may from time to time, to the extent permitted by the
Trust Agreement, the Prospectus, this paragraph
<PAGE>

3, and applicable law, buy and sell options, futures contracts (including index
futures contracts), and options on futures contracts (including options on index
futures contracts) on behalf of the Fund. The Sub-Adviser will only effect
transactions in such instruments for the purpose of protecting against possible
adverse fluctuations in the values of investments or cash held by the Fund or
which the Fund intends to purchase. The Adviser and the Trust recognize that
the purchase and sale of options, futures contracts (including index futures
contracts) and options on futures contracts (including options on index futures
contracts) involve, among other things, the risks described in the Prospectus.
Subject to the terms of the Prospectus, the Sub-Adviser has the power to effect
and close out transactions for the Fund in options, futures contracts, and
options on futures contracts (whether involving contingent liability for the
Trust or the Fund and whether of a type traded on, or effected under the rules
of an investment exchange recognized or designated for the purposes of the
Financial Services Act or otherwise) provided, however, that; the Sub-Adviser
-------- ------- ----
may not, on behalf of the Fund, purchase or sell futures contracts or purchase
related options if, immediately thereafter, the sum of the amount of margin
deposits and premiums on open positions with respect to futures contracts and
related options would exceed 5% of the market value of the Fund's total assets.

(b) The services provided by the Sub-Adviser may relate to investments or
assets denominated in various currencies. The Adviser and the Trust recognize
that movements of currency exchange rates may have an effect, favorable or
unfavorable, on the gain or loss otherwise experienced with respect to the
investments or assets of the Fund.

(c) In accordance with the provisions of the 1940 Act, the Sub-Adviser
may from time to time cause the Fund's assets to be held in bank accounts
outside the U.S. and the U.K. However, the Sub-Adviser will not itself hold
money or assets on behalf of the Fund.

(d) The Sub-Adviser may not commit the Fund or the Adviser to a contract
the performance of which may require either of them to supplement the assets of
the Fund, nor may the Sub-Adviser commit the Fund or the Adviser to supplement
the assets of the Fund by borrowing on their behalf.

(e) The Sub-Adviser may not commit the Fund to act as a securities
underwriter except to the extent that the Fund may, after prior consultation
with the Treasurer of the Trust, invest up to 15% of its assets in illiquid
securities (including repurchase agreements maturing in more than seven days)
and, except to the extent that in connection with the disposition of such
securities the Fund may be deemed to be an underwriter under the Securities Act
of 1933.
<PAGE>

(f) The Sub-Adviser may not, without the Fund's prior consent, purchase
or sell units in collective investment schemes on behalf of the Fund.

4. The services of the Sub-Adviser to the Fund hereunder are not to be
deemed exclusive and the Sub-Adviser shall be free to render similar service to
others so long as its services hereunder are not impaired or interfered with
thereby.

5.(a) It is understood that trustees, officers, agents and shareholders of
the Trust are or may be interested in the Sub-Adviser as directors, officers,
shareholders or otherwise, that directors, officers, agents and shareholders of
the Sub-Adviser are or may be interested in the Trust as trustees or officers or
otherwise, that the Sub-Adviser may be interested in the Trust, and that the
existence of any such dual interest shall not affect the validity hereof or of
any transactions hereunder except as otherwise provided in the Trust Agreement
and the Certificate of Incorporation of the Sub-Adviser, respectively, or by
specific provision of applicable law.

(b) The Sub-Adviser may not, without the prior consent of the Fund,
effect transactions with or for the Fund in which the Sub-Adviser or an
affiliate of the Sub-Adviser has directly or indirectly a material interest
(including, without limitation, transactions in which the Sub-Adviser acts as
principal) or which may involve a conflict with the Sub-Adviser's duties
hereunder.

6.(a) This Agreement will take effect upon the date hereof following
execution by the Sub-Adviser and shall thereafter continue in full force and
effect from year to year, if its continuance is specifically approved at least
annually by vote of a majority of the outstanding shares (as defined in the 1940
Act) of the Fund or by the Board of Trustees of the Trust, and in either event
by a majority of the Trustees of the Trust who are not parties to this Agreement
or interested persons (within the meaning of the 1940 Act) of the Trust, the
Adviser or the Sub-Adviser, such Trustees voting in person at a meeting called
for such purpose; provided, however, that:

(b) This Agreement may at any time be terminated without the payment of
any penalty on 60 days' written notice to the Sub-Adviser either (i) by the
Adviser, (ii) by the Trust, (A) by vote of the Board of Trustees of the Trust or
(B) by vote of a majority of the outstanding voting securities of the Fund.

(c) This Agreement shall immediately terminate in event of its assignment
(as that term is defined in the 1940 Act) or upon expiration of the Master
Investment Advisory Agreement now or hereinafter in effect between the Adviser
and the Trust with respect to the Fund.
<PAGE>

(d) This Agreement may be terminated by the Sub-Adviser on 90 days'
written notice to the Adviser and the Trust.

(e) Any termination of this Agreement will be without prejudice to the
completion of transactions already initiated by the Sub-Adviser on behalf of the
Trust at the time of such termination. The Sub-Adviser shall take all steps
reasonably necessary after such termination to complete any such transaction.

7. Any notice under this Agreement shall be in writing, addressed and
delivered or mailed postage prepaid to the other party at such address as such
other party may designate for the receipt of such notices.

8. As a member of IMRO the Sub-Adviser is regulated by IMRO in the
conduct of its investment business and the following information is given in
accordance with the IMRO Rules:

The Sub-Adviser's complaint procedure is that complaints may be
addressed to Vice President-Senior Equity Strategist at the Sub-Adviser's office
at Park House, 16 Finsbury Circus, London, England EC2 7AX. If not resolved,
any complaint may then be made in writing to the Managing Director, and such
officer will investigate. CII may also complain directly to IMRO.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.

CIGNA INVESTMENTS, INC.

By /s/ Arthur C. Reeds III
---------------------------------
Arthur C. Reeds III
President

CIGNA INTERNATIONAL
INVESTMENT ADVISORS, LTD.

By /s/ Richard H. Forde
----------------------------------
Richard H. Forde
President
<PAGE>

SCHEDULE A
TO
SUB-ADVISORY AGREEMENT

The Adviser will pay the Sub-Adviser a fee calculated on a cost-
reimbursement basis for services rendered during the first twelve months of the
Fund's operation (the "Sub-Advisory Fee"). The fee will be paid quarterly in
arrears. The Sub-Advisory Fee for subsequent years will be that amount as
agreed to by the parties from time to time as evidenced by amendment to this
Sub-Advisory Agreement or side letter. The Sub-Adviser will not be receiving
any remuneration from any party other than the Adviser for rendering services
pursuant to this Agreement.

<PAGE>

Exhibit (9d)
PARTICIPATION AGREEMENT
-----------------------

Among

CIGNA VARIABLE PRODUCTS GROUP,
-----------------------------

CIGNA FINANCIAL ADVISORS, INC.
------------------------------

and

CONNECTICUT GENERAL LIFE INSURANCE COMPANY
------------------------------------------

THIS AGREEMENT, made and entered into as of the 27th day of February, 1996
by and among CONNECTICUT GENERAL LIFE INSURANCE COMPANY (hereinafter the
"Company"), a Connecticut corporation, on its own behalf and on behalf of each
segregated asset account of the Company set forth on Schedule A hereto as may be
amended from time to time (each such account hereinafter referred to as the
"Account"), and CIGNA VARIABLE PRODUCTS GROUP, an unincorporated business trust
organized under the laws of the Commonwealth of Massachusetts (hereinafter the
"Fund") and CIGNA Financial Advisors, Inc. (hereinafter the "Underwriter"), a
Connecticut corporation.

WITNESSETH:

WHEREAS, the Fund is registered as an open-end management investment company
under the Investment Company Act of 1940 (the "1940 Act") and is available to
act as an investment vehicle for separate accounts established for variable life
insurance policies and variable annuity contracts (collectively, the "Variable
Insurance Products") to be offered by insurance companies which have entered
into participation agreements with the Fund and the Underwriter (hereinafter
"Participating Insurance Companies") and the Fund's shares are registered under
the Securities Act of 1933 ("1933 Act");

WHEREAS, the beneficial interest in the Fund is divided into several series
of shares, each representing the interest in a particular managed portfolio of
securities and other assets, any one or more of which may be made available
under this Agreement, as may be amended from time to time by mutual agreement of
the parties hereto (each such series hereinafter referred to as a "Portfolio");

WHEREAS, the Fund has obtained an order from the Securities and Exchange
Commission, dated December 29, 1995 (File No.812-9698), granting Participating
Insurance Companies and variable annuity and variable life insurance separate
accounts exemptions from the provisions of sections 9(a), 13(a), 15(a), and
15(b) of the 1940 Act and Rules 6e-2(b) (15) and 6e-3(T) (b) (15) thereunder, to
the extent necessary to permit shares of the

Page 1
<PAGE>

Fund to be sold to and held by variable annuity and variable life insurance
separate accounts of both affiliated and unaffiliated life insurance companies
(hereinafter the "Mixed and Shared Funding Exemptive Order");

WHEREAS, CIGNA Investments, Inc. (the "Adviser") is duly registered as an
investment adviser under the 1940 Act and any applicable state securities law;

WHEREAS, the Company has registered or will register certain variable
insurance products under the 1933 Act;

WHEREAS, each Account is a duly organized, validly existing segregated asset
account, established by resolution of the Board of Directors of the Company, on
the date shown for such Account on Schedule A hereto, to set aside and invest
assets attributable to the aforesaid variable insurance products ;

WHEREAS, the Company has registered or will register each Account as a unit
investment trust under the 1940 Act;

WHEREAS, the Underwriter is registered as a broker dealer with the
Securities and Exchange Commission ("SEC" or "Commission") under the Securities
Exchange Act of 1934, as amended, (hereinafter the "1934 Act"), and is a member
in good standing of the National Association of Securities Dealers, Inc.
(hereinafter "NASD");

WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Portfolios on behalf
of each Account to fund certain of the aforesaid variable insurance products
and the Underwriter is authorized to sell such shares to each Account at net
asset value;

NOW, THEREFORE, in consideration of their mutual promises, the Company, the
Fund and the Underwriter agree as follows:

ARTICLE I. Sale and Redemption of Fund Shares
----------------------------------

1.1. The Underwriter agrees to sell to the Company those shares of the Fund
which each Account orders, executing such orders on a daily basis at the net
asset value next computed after receipt by the Fund or its designee of the order
for the shares of the Fund. For purposes of this Section 1.1. the Company shall
be the designee of the Fund for receipt of such orders from each Account and
receipt by such designee shall constitute receipt by the Fund; provided that the
Fund receives notice of such order on the next following Business Day.
"Business Day" shall mean any day on which the New York Stock Exchange is open
for trading and on which the Fund calculates its net asset value pursuant to the
rules of the Commission.

1.2. The Fund agrees to make its shares available indefinitely for purchase
at the applicable net asset value per share by the Company and its Accounts on
those days on which the Fund calculates its net asset value pursuant to rules of
the Commission and the Fund shall use reasonable efforts to calculate such net
asset value on each day on which the New York Stock Exchange is open for
trading. Notwithstanding the foregoing, the Board of

Page 2
<PAGE>

Trustees of the Fund (hereinafter the "Board") may refuse to sell shares of any
Portfolio to any person or suspend or terminate the offering of shares of any
Portfolio if such action is required by law or by regulatory authorities having
jurisdiction.

1.3. The Fund and the Underwriter agree that shares of the Fund will be
sold only to Participating Insurance Companies and their separate accounts and
to qualified pension and retirement plans. No shares of any Portfolio will be
sold to the general pubic.

1.4. The Fund and the Underwriter will not sell Fund shares to any
insurance company or separate account unless an agreement containing provisions
substantially the same as Articles I, III, V, VII and Section 2.5 of Article II
of this Agreement is in effect to govern such sales.

1.5. The Fund agrees to redeem for cash, on the Company's request, any full
or fractional shares of the Fund held by the Company, executing such requests on
a daily basis at the net asset value next computed after receipt by the Fund or
its designee of the request for redemption. For purposes of this Section 1.5,
the Company shall be the designee of the Fund for receipt of requests for
redemption from each Account and receipt by such designee shall constitute
receipt by the Fund; provided that the Fund receives notice of such request for
redemption on the next following Business Day. Payment shall be in federal
funds transmitted by wire.

1.6. The Company agrees that purchases and redemptions of Portfolio shares
offered by the then current prospectus of the Fund shall be made in accordance
with the provisions of such prospectus.

1.7. The Company shall pay for Fund shares on the next Business Day after
an order to purchase Fund shares is made in accordance with the provisions of
Section 1.1. hereof. Payment shall be in federal funds transmitted by wire. For
purpose of Section 2.10 and 2.11, upon receipt by the Fund of the federal funds
so wired, such funds shall cease to be the responsibility of the Company and
shall become the responsibility of the Fund.

1.8. Issuance and transfer of the Fund's shares will be by book entry only.
Stock certificates will not be issued to the Company or any Account. Shares
ordered from the Fund will be recorded in an appropriate title for each Account
or the appropriate subaccount of each Account.

1.9. The Fund shall furnish same day notice (by wire or telephone, followed
by written confirmation) to the Company of any income, dividends or capital gain
distributions payable on the Fund's shares. The Company hereby elects to receive
all such income dividends and capital gain distributions as are payable on the
Portfolio shares in additional shares of that Portfolio. The Company reserves
the right to revoke this election and to receive all such income dividends and
capital gain distributions in cash. The Fund shall notify the Company of the
number of shares so issued as payment of such dividends and distributions.

1.10. The Fund shall make the net asset value per share for each Portfolio
available to the Company on a daily basis by 6:30 p.m. Hartford, Connecticut
time.

Page 3
<PAGE>

ARTICLE II. Representations and Warranties
------------------------------

2.1. The Company represents and warrants that the Contracts are or will be
registered under the 1933 Act; that the Contracts will be issued and sold in
compliance in all material respects with all applicable Federal and State laws
and that the sale of the Contracts shall comply in all material respects with
state insurance law suitability requirements. The Company further represents
and warrants that it is an insurance company duly organized and in good standing
under applicable law and that it has legally and validly established each
Account prior to any issuance or sale thereof as a segregated asset account
under Section 38a-433 of the Connecticut General Statutes and has registered or,
prior to any issuance or sale of the Contracts, will register each Account as a
unit investment trust in accordance with the provisions of the 1940 Act to serve
as a segregated investment account for the Contracts.

2.2. The Fund represents and warrants that Fund shares sold pursuant to
this Agreement shall be registered under the 1933 Act, duly authorized for
issuance and sold in compliance with all applicable federal and state securities
laws and that the Fund is and shall remain registered under the 1940 Act. The
Fund shall amend the Registration Statement for its shares under the 1933 Act
and the 1940 Act from time to time as required in order to effect the continuous
offering of its shares. The Fund shall register and qualify the shares for sale
in accordance with the laws of the various states only if and to the extent
deemed advisable by the Fund or the Underwriter.

2.3. The Fund represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code of 1986, as
amended, (the "Code") and that it will make every effort to maintain such
qualification (under Subchapter M or any successor or similar provision) and
that it will notify the Company immediately upon having a reasonable basis for
believing that it has ceased to so qualify or that it might not so qualify in
the future.

2.4. The Company represents that the Contracts are currently treated as
life insurance contracts (including endowment contracts) or annuity insurance
contracts under applicable provisions of the Code, and that it will make every
effort to maintain such treatment and that it will notify the Fund and the
Underwriter immediately upon having a reasonable basis for believing that the
Contracts have ceased to be so treated or that they might not be so treated in
the future.

2.5. The Fund currently does not intend to make any payments to finance
distribution expenses pursuant to Rule 12b-1 under the 1940 Act or otherwise,
although it may make such payments in the future. To the extent that it decides
to finance distribution expenses pursuant to Rule 12b-1, the Fund undertakes to
have a board of trustees, a majority of whom are not interested persons of the
Fund, formulate and approve any plan under Rule 12b-1 to finance distribution
expenses.

2.6. The Fund makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and investment
policies) complies with the insurance laws or regulations of the various states
except that the Fund represents that the

Page 4
<PAGE>

Fund's investment policies, fees and expenses are and shall at all times remain
in compliance with applicable laws and the Fund and the Underwriter represent
that their respective operations are and shall at all times remain in material
compliance with applicable laws to the extent required to perform this
Agreement.

2.7. The Underwriter represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC. The
Underwriter further represents that it will sell and distribute the Fund shares
in accordance with the laws of the State of Connecticut and all applicable state
and federal securities laws, including without limitation the 1933 Act, the 1934
Act, and the 1940 Act.

2.8. The Fund represents that it is lawfully organized and validly existing
under the laws of the Commonwealth of Massachusetts and that it does and will
comply in all material respects with the 1940 Act.

2.9. The Fund and Underwriter each severally represent and warrant that all
of its directors, officers, employees, investment advisers, and other
individuals/entities dealing with the money and/or securities of the Fund are
and shall continue to be at all times covered by a blanket fidelity bond or
similar coverage for the benefit of the Fund in an amount not less than the
minimal coverage as required currently by Rule 17g-1 under the 1940 Act or
related provisions as may be promulgated from time to time. The aforesaid Bond
shall include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company.

2.10. The Company represents and warrants that all of its directors,
officers, employees, investment advisers, and other individuals/entities under
its control dealing with the money and/or securities of the Fund are covered by
a blanket fidelity bond or similar coverage for the benefit of the Fund, and
that said bond is issued by a reputable bonding company, includes coverage for
larceny and embezzlement, and is in an amount not less than $5 million. The
Company agrees to make all reasonable efforts to see that this bond or another
bond containing these provisions is always in effect, and agrees to notify the
Fund and the Underwriter in the event that such coverage no longer applies.

ARTICLE III. Prospectuses and Proxy Statements; Voting
-----------------------------------------

3.1. The Fund shall provide the Company with as many printed copies of the
Fund's current prospectus and Statement of Additional Information, as the
Company may reasonably request. If requested by the Company in lieu thereof,
the Fund shall provide camera-ready copy or computer diskettes containing the
Fund's prospectus and Statement of Additional Information, and such other
assistance as is reasonably necessary in order for the Company once each year
(or more frequently if the prospectus and/or Statement of Additional Information
for the Fund is amended or supplemented during the year) to have the prospectus
for the Contracts and the Fund's prospectus printed together in one document,
and to have the Statement of Additional Information if applicable, for the Fund
and the Statement of Additional Information for the Contracts printed together
in one document. Alternatively, the Company may print the Fund's prospectus
and/or its Statement of Additional Information in combination with other fund
companies' prospectuses and statements of additional information. Except as
provided below, all expenses of printing and

Page 5
<PAGE>

distributing Fund prospectuses and Statements of Additional Information shall be
the expense of the Company. For prospectuses and Statements of Additional
Information provided by the Company to its existing owners of Contracts in order
to update disclosure as required by the 1933 Act and/or the 1940 Act, the cost
of printing shall be borne by the Fund. The cost of preparing, printing and
shipping of the prospectuses and statements of Additional Information shall be
paid by the Fund; provided, however, that if at any time the Fund or its agent
reasonably deems the usage by the Company of such items to be excessive, it may,
prior to the delivery of any quantity of materials in excess of what is deemed
reasonable, request that the Company demonstrate the reasonableness of such
usage. If the reasonableness of such usage has not been adequately demonstrated,
the Fund may request that the Company pay the cost of printing and delivery of
any excess copies of such materials. If the Company chooses to receive camera-
ready copy or computer diskettes in lieu of receiving printed copies of the
Fund's prospectus, the Fund will reimburse the Company in an amount equal to the
product of A and B where A is the number of such prospectuses distributed to
owners of the Contracts, and B is the Fund's per unit cost of typesetting and
printing the Fund's prospectus. The same procedures shall be followed with
respect to the Fund's Statement of Additional Information.

The Company agrees to provide the Fund or its designee with such information
as may be reasonably requested by the Fund to assure that the Fund's expenses do
not include the cost of printing any prospectuses or Statements of Additional
Information other than those actually distributed to existing owners of the
Contracts. The Company shall be responsible for the cost of printing and
distributing Fund prospectuses and Statements of Additional Information to
prospective Contract Owners.

3.2. The Fund's prospectus shall state that the Statement of Additional
Information for the Fund is available from the Fund, Underwriter or the Company.

3.3. The Fund, at its expense, shall provide the Company with copies of its
proxy statements, reports to shareholders, and other communications (except for
prospectuses and Statements of Additional Information, which are covered in
Section 3.1) to shareholders in such quantity as the Company shall reasonably
require for distributing to Contract owners. If requested by the Company, in
lieu of receiving copies of reports to shareholders and other communications
(excluding proxy statements), the Fund shall provide camera-ready copy or
computer diskettes containing this material. If the Company chooses to receive
camera-ready copy or computer diskettes in lieu of receiving printed copies of
the shareholder reports and other communications (excluding proxy materials) the
Fund will reimburse the Company in an amount equal to the product of A and B
where A is the number of such reports or other communications distributed to
owners of the Contracts, and B is the Fund's per unit cost of typesetting and
printing the material.

The Company agrees to provide the Fund or its designee with such information
as may be reasonably requested by the Fund to assure that the Fund's expenses do
not include the cost of printing any shareholder reports or other communications
other than those actually distributed to existing owners of the Contracts. The
Company shall be responsible for the cost of printing and distributing
shareholder reports or other communications to prospective Contract Owners.

Page 6
<PAGE>

3.4. If and to the extent required by law the Company shall:

(i) solicit voting instructions from Contract owners;

(ii) vote the Fund shares in accordance with instructions received
from Contract owners; and

(iii) vote Fund shares for which no instructions have been received
in a particular separate account in the same proportion as
Fund shares of such portfolio for which instructions have
been received in that separate account,

so long as and to the extent that the Commission continues to interpret the
1940 Act to require pass-through voting privileges for variable contract owners.
The Company reserves the right to vote Fund shares held in any segregated asset
account in its own right, to the extent permitted by law.

3.5. The Fund will comply with all provisions of the 1940 Act requiring
voting by shareholders, and in particular the Fund will either provide for
annual meetings or comply with Section 16) of the 1940 Act (although the Fund is
not one of the trusts described in Section 16(c) of that Act) to the extent
applicable. Further, the Fund will act in accordance with the Commission's
interpretation of the requirements of Section 16(a) with respect to periodic
elections of trustees and with whatever rules the Commission may promulgate with
respect thereto.

3.6 The Company will vote the shares of the Fund held by the Company in
the Separate Account in accordance with written instructions received from
certificate or policy owners. The Company will vote shares for which it has not
received instructions, as well as shares attributable to the Company, in the
same proportion as it votes shares for which it has received instructions.

ARTICLE IV. Sales Material and Information
------------------------------

4.1. The Company shall furnish, or shall cause to be furnished, to the Fund
or its designee, each piece of sales literature or other promotional material in
which the Fund or its investment adviser or the Underwriter is named, at least
ten Business Days prior to its use. No such material shall be used if the Fund
or its designee reasonably objects to such use within seven Business Days after
receipt of such material.

4.2. The Company shall not give any information or make any representations
or statements on behalf of the Fund or concerning the Fund in connection with
the sale of the Contracts other than the information or representations
contained in the registration statement or prospectus for the Fund shares, as
such registration statement and prospectus may be amended or supplemented from
time to time, or in reports or proxy statements for the Fund, or in sales
literature or other promotional material approved by the Fund or its designee or
by the Underwriter, except with the permission of the Fund or the designee of
the Fund.

Page 7
<PAGE>

4.3. The Fund, Underwriter, or its designee shall furnish, or shall cause
to be furnished, to the Company or its designee, each piece of sales literature
or other promotional material in which the Company and/or its separate
account(s), is named at least ten Business Days prior to its use. No such
material shall be used if the Company or its designee reasonably objects to such
use within seven Business Days after receipt of such material.

4.4. The Fund and the Underwriter shall not give any information or make
any representations on behalf of the Company or concerning the Company, each
Account, or the Contracts other than the information or representations
contained in a registration statement or prospectus for the Contracts, as such
registration statement and prospectus may be amended or supplemented from time
to time, or in published reports for each Account which are in the public domain
or approved by the Company for distribution to Contract owners, or in sales
literature or other promotional material approved by the Company or its
designee, except with the permission of the Company.

4.5. The Fund will provide to the Company at least one complete copy of all
registration statements, prospectuses, Statements of Additional Information,
reports, proxy statements, sales literature and other promotional materials,
applications for exemptions, requests for no-action letters, and all amendments
to any of the above, that relate to the Fund or its shares, contemporaneously
with the filing of such document with the Securities and Exchange Commission or
other regulatory authorities.

4.6. The Company will provide to the Fund at least one complete copy of all
registration statements, prospectuses, Statements of Additional Information,
reports, solicitations for voting instructions, sales literature and other
promotional materials, applications for exemptions, requests for no action
letters, and all amendments to any of the above, that relate to the Contracts or
each Account, contemporaneously with the filing of such document with the SEC or
other regulatory authorities.

4.7. For purposes of this Article IV, the phrase "sales literature or other
promotional material" includes, but is not limited to, any of the following that
refer to the Fund or any affiliate of the Fund: advertisements (such as material
published, or designed for use in, a newspaper, magazine, or other periodical,
radio, television, telephone or tape recording, videotape display, signs or
billboards, motion pictures, or other public media), sales literature (i.e., any
---
written communication distributed or made generally available to customers or
the public, including brochures, circulars, research reports, market letters,
form letters, seminar texts, reprints or excerpts of any other advertisement,
sales literature, or published article) and registration statements,
prospectuses, Statements of Additional Information, shareholder reports, and
proxy materials.

ARTICLE V. Fees and Expenses
-----------------

5.1. The Fund and Underwriter shall pay no fee or other compensation to the
Company under this agreement, except that if the Fund or any Portfolio adopts
and implements a plan pursuant to Rule 12b-1 to finance distribution expenses,
then the Underwriter may make payments to the Company or to the underwriter for
the Contracts in amounts agreed to by the Underwriter in writing and such
payments will be made out of

Page 8
<PAGE>

existing fees otherwise payable to the Underwriter, past profits of the
Underwriter or other resources available to the Underwriter. No such payments
shall be made directly by the Fund, (Currently, no such payments are
contemplated.)

5.2. All expenses incident to performance by the Fund under this Agreement
shall be paid by the Fund. The Fund shall see to it that all its shares are
registered and authorized for issuance in accordance with applicable federal law
and, if and to the extent deemed advisable by the Fund, in accordance with
applicable state laws prior to their sale. The Fund shall bear the expenses for
the cost of registration and qualification of the Fund's shares, preparation and
filing of the Fund's prospectus and registration statement, proxy materials and
reports, setting the prospectus in type, setting in type and printing the proxy
materials and reports to shareholders , the preparation of all statements and
notices required by any federal or state law, and all taxes on the issuance or
transfer of the Fund's shares.

5.3 The Fund shall bear the expenses of distributing the Fund's
prospectus, proxy materials, statement of additional information and reports to
owners of Contracts issued by the Company. If the Company distributes such
materials in combination with materials of other funds, the Fund shall reimburse
the Company a pro rata share of the cost of distribution, based upon the weight
of the Fund materials compared to the weight of the other fund materials.

ARTICLE VI. Diversification
---------------

6.1. The Fund will at all times invest money from the Contracts in such a
manner as to ensure that the Contracts will be treated as variable contracts
under the Code and the regulations issued thereunder. Without limiting the
scope of the foregoing, the Fund will at all times comply with Section 817(h) of
the Code and Treasury Regulation 1.817-5, relating to the diversification
requirements for variable annuity, endowment, or life insurance contracts and
any amendments or other modifications to such Section or Regulations. In the
event of a breach of this Article VI by the Fund, it will take all reasonable
steps (a) to notify Company of such breach and (b) to adequately diversify the
Fund so as to achieve compliance with the grace period afforded by Regulation
1.817-5.

ARTICLE VII. Potential Conflicts
-------------------

7.1. The Board of Directors of the Fund will monitor the Fund for the
existence of any material irreconcilable conflict between the interests of the
contract owners of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise for a variety of reasons, including:
(a) an action by any state insurance regulatory authority; (b) a change in
applicable federal or state insurance, tax, or securities laws or regulations,
or a public ruling, private letter ruling, no-action or interpretative letter,
or any similar action by insurance, tax, or securities regulatory authorities;
(c) an administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of any Portfolio are being managed; (e) a
difference in voting instructions given by variable annuity contract and
variable life insurance contract owners; or (f) a decision by an insurer to
disregard the voting instructions of contract owners. The Board shall promptly
inform the Company if it determines that an irreconcilable material conflict
exists and the implications thereof.

Page 9
<PAGE>

7.2. The Company will report any potential or existing conflicts of which
it is aware to the Board. The Company will assist the Board in carrying out its
responsibilities under the Mixed and Shared Funding Exemptive Order, by
providing the Board with all information reasonably necessary for the Board to
consider any issues raised. This includes, but is not limited to, an obligation
by the Company to inform the Board whenever contract owner voting instructions
are disregarded.

7.3. If it is determined by a majority of the Board, or a majority of its
disinterested trustees, that the Company has caused or created a material
irreconcilable conflict, the Company shall at its expense and to the extent
reasonably practicable (as determined by a majority of the disinterested
trustees), take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, up to and including: (1), withdrawing the
assets allocable to some or all of the separate accounts from the Fund or any
Portfolio and reinvesting such assets in a different investment medium,
including (but not limited to) another Portfolio of the Fund, or submitting the
question whether such segregation should be implemented to a vote of all
affected Contract owners and, as appropriate, segregating the assets of any
appropriate group (i.e., annuity contract owners, life insurance contract
----
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the affected
contract owners the option of making such a change; and (2), establishing a new
registered management investment company or managed separate account.

7.4. If a material irreconcilable conflict arises because of a decision by
the Company to disregard contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the Company
may be required, at the Fund's election, to withdraw the affected Account's
investment in the Fund and terminate this Agreement with respect to such
Account; provided, however that such withdrawal and termination shall be limited
to the extent required by the foregoing material irreconcilable conflict as
determined by a majority of the disinterested members of the Board. Any such
withdrawal and termination must take place within six (6) months after the Fund
gives written notice that this provision is being implemented, and until the end
of that six month period the Underwriter and Fund shall continue to accept and
implement orders by the Company for the purchase (and redemption) of shares of
the Fund.

7.5. If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will withdraw the
affected Account's investment in the Fund and terminate this Agreement with
respect to such Account within six months after the Board informs the Company in
writing that it has determined that such decision has created an irreconcilable
material conflict; provided, however, that such withdrawal and termination shall
be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested members of the Board.
Until the end of the foregoing six month period, the Underwriter and Fund shall
continue to accept and implement orders by the Company for the purchase (and
redemption) of shares of the Fund.

7.6. For purposes of Sections 7.3 through 7.6 of this Agreement, a majority
of the disinterested members of the Board shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no event
will the Fund be required to

Page 10
<PAGE>

establish a new funding medium for the Contracts. The Company shall not be
required by Section 7.3 to establish a new funding medium for the Contracts if
an offer to do so has been declined by vote of a majority of Contract owners
materially adversely affected by the irreconcilable material conflict. In the
event that the Board determines that any proposed action does not adequately
remedy any irreconcilable material conflict, then the Company will withdraw the
Account's investment in the Fund and terminate this Agreement within Six (6)
months after the Board informs the Company in writing of the foregoing
determination, provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested members of the Board.

7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or
Rule 6e-3 is adopted, to provide exemptive relief from any provision of the Act
or the rules promulgated thereunder with respect to mixed or shared funding (as
defined in the Mixed and Shared Funding Exemptive Order) on terms and conditions
materially different from those contained in the Mixed and Shared Funding
Exemptive Order, then (a) the Fund and/or the Participating Insurance Companies,
as appropriate, shall take such steps as may be necessary to comply with Rules
6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the extent such
rules are applicable; and (b) Sections 3.4, 3.5, 7.1, 7.2, 7.3, 7.4, and 7.5 of
this Agreement shall continue in effect only to the extent that terms and
conditions substantially identical to such Sections are contained in such
Rule(s) as so amended or adopted.

ARTICLE VIII. Indemnification
---------------

8.1. The Company agrees to indemnify and hold harmless the Fund and the
Underwriter and their respective officers, directors, employees, agents,
affiliates and each person, if any, who controls the Fund and the Underwriter
within the meaning of the Securities Act of 1933 (collectively, the "Indemnified
Parties" for purposes of this Section 8.2) against any Losses to which the
Indemnified Parties may become subject, insofar as such losses result from a
breach by the Company of this Agreement. The Company will reimburse any legal
or other expenses reasonably incurred by the Indemnified Parties in connection
with investigating or defending any such Losses. The Company shall not be liable
for indemnification hereunder if such Losses are attributable to the negligence
or misconduct of the Fund or the Underwriter in performing their obligations
under this Agreement.

8.2. Promptly after receipt by an Indemnified Party hereunder of notice of
the commencement of action, such Indemnified Party will, if a claim in respect
thereof is to be made against the Indemnifying Party hereunder, notify the
Indemnifying Party of the commencement thereof; but the omission so to notify
the Indemnifying Party will not relieve it from any liability which it may have
to any Indemnified Party otherwise than under this Section 8. In case any such
action is brought against any Indemnified Party, and it notifies the
Indemnifying Party of the commencement thereof, the Indemnifying Party will be
entitled to participate therein and, to the extent that it may wish to, assume
the defense thereof, with counsel satisfactory to such Indemnified Party, and
after notice from the Indemnifying Party to such Indemnified Party of its
election to assume the defense thereof, the Indemnifying Party will not be
liable to such Indemnified Party under this

Page 11
<PAGE>

Section 8 for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof other than the
reasonable costs of investigation.

8.3. If the Indemnifying Party assumes the defense of any such action, the
Indemnifying Party shall not, without the prior written consent of the
indemnified parties in such action, settle or compromise the liability of the
indemnified parties in such action, or permit a default or consent to the entry
of any judgement in respect thereof, unless in connection with such settlement,
compromise or consent, each Indemnified Party receives from such claimant an
unconditional release from all liability in respect of such claim.

ARTICLE IX. Applicable Law
--------------

9.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts.

9.2. This Agreement shall be subject to the provisions of the 1933 Act, the
1934 Act, and the 1940 Act, and the rules and regulations and rulings
thereunder, including such exemptions from those statutes, rules and regulations
as the Securities and Exchange Commission may grant (including, but not limited
to, the Mixed and Shared Funding Exemptive Order) and the terms hereof shall be
interpreted and construed in accordance therewith.

ARTICLE X. Termination
-----------

10.1. This Agreement shall continue in full force and effect until the first
to occur of:

(a) termination by any party for any reason by 6 months' advance
written notice delivered to the other parties; or

(b) termination by the Company by written notice to the Fund and the
Underwriter with respect to any Portfolio based upon the
Company's determination that shares of such Portfolio are not
reasonably available to meet the requirements of the Contracts;
or

(c) termination by the Company by written notice to the Fund and the
Underwriter with respect to any Portfolio in the event any of the
Portfolio's shares are not registered, issued or sold in
accordance with applicable state and/or federal law or such law
precludes the use of such shares as the underlying investment
media of the Contracts issued or to be issued by the Company; or

(d) termination by the Company by written notice to the Fund and the
Underwriter with respect to any Portfolio in the event that such
Portfolio ceases to qualify as a Regulated Investment Company
under Subchapter M of the Code or under any successor or similar
provision, or if the Company reasonably believes that the Fund
may fail to so qualify; or

Page 12
<PAGE>

(e) termination by the Company by written notice to the Fund and the
Underwriter with respect to any Portfolio in the event that such
Portfolio fails to meet the diversification requirements
specified in Article VI hereof.

10.2. Effect of Termination. Notwithstanding any termination of the
---------------------
Agreement, the Fund and the Underwriter shall at the option of the Company,
continue to make available additional shares of the Fund pursuant to the terms
and conditions of this Agreement, for all Contracts in effect on the effective
date of termination of this Agreement (hereinafter referred to as "Existing
Contracts"). Specifically, without limitation, the owners of the Existing
Contracts shall be permitted to reallocate investments in the Fund, redeem
investments in the Fund and/or invest in the Fund upon the making of additional
purchase payments under the Existing Contracts. The parties agree that
continuation of availability to existing contracts shall not apply if proscribed
by law or the SEC or other regulatory body.

ARTICLE XI. Notices
-------

Any notice shall be sufficiently given when sent by registered or certified
mail to the other party at the address of such party set forth below or at such
other address as such party may from time to time specify in writing to the
other party.

If to the Fund:

CIGNA Variable Products Group
900 Cottage Grove Road
Hartford, Ct. 06152-2210
Attention: Alfred A. Bingham, III, S-210

If to the Company:

Connecticut General Life Insurance Company
CIGNA Group Insurance Division
1601 Chestnut Street, TLP-47
Philadelphia, PA 19192
Attention: Jerold H. Rosenblum, Chief Counsel
CIGNA Group Insurance Division

If to the Underwriter:

CIGNA Financial Advisors, Inc.
900 Cottage Grove
Hartford, CT 06152-2203
Attention: Karen Goldman, S-203

Page 13
<PAGE>

ARTICLE XII. Miscellaneous
-------------

12.1. All persons dealing with the Fund must look solely to the property of
the Fund for the enforcement of any claims against the Fund as neither the
Board, officers, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Fund.

12.2. Subject to the requirements of legal process and regularly authority,
each party hereto shall treat as confidential the names and addresses of the
owners of the Contracts and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
the Agreement, shall not disclose, disseminate or utilize such names and
addressed and other confidential information until such time as it may come into
the public domain without the express written consent of the affected party.

12.3. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.

12.4. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.

12.5. If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Agreement shall
not be affected thereby.

12.6. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this Agreement or the transactions contemplated hereby.
Notwithstanding the generality of the foregoing, each party hereto further
agrees to furnish the California Insurance Commissioner with any information or
reports in connection with services provided under this Agreement which such
Commissioner may request in order to ascertain whether the insurance operations
of the Company are being conducted in a manner consistent with the California
Insurance Regulations and any other applicable law or regulations.

12.7. The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and obligations,
at law or in equity, which the parties hereto are entitled to under state and
federal laws.

12.8. This Agreement or any of the rights and obligations hereunder may not
be assigned by any party without the prior written consent of all parties
hereto; provided, however, that the Underwriter may assign this Agreement or any
rights or obligations hereunder to any affiliate of or company under common
control with the Underwriter, if such assignee is duly licensed and registered
to perform the obligations of the Underwriter under this Agreement.

Page 14
<PAGE>

12.9. The Company shall furnish, or shall cause to be furnished, to the Fund
or its designee copies of the following reports:

(a) the Company's annual statement (prepared under statutory
accounting principles) and annual report (if one is prepared
under generally accepted accounting principles ("GAAP"), as soon
as practical and in any event within 120 days after the end of
each fiscal year;

(b) the Company's quarterly statements (statutory) (and GAAP if any),
as soon as practical and in any event within 60 days after the
end of each quarterly period:

(c) any financial statement, proxy statement, notice or report of the
Company sent to stockholders and/or policyholders, as soon as
practical after the delivery thereof to stockholders;

(d) any registration statement (without exhibits) and financial
reports of the Company filed with the Securities and Exchange
Commission or any state insurance regulator, as soon as practical
after the filing thereof;

(e) any other report submitted to the Company by independent
accountants in connection with any annual, interim or special
audit made by them of the books of the Company, as soon as
practical after the receipt thereof.

(f) such reports, materials, or data as the Fund may reasonably
request so that the Fund may fully carry out the obligations
imposed on the Fund by the Fund's Mixed and Shared Funding
Exemptive Order, and such reports, materials, and data shall be
submitted more frequently if deemed appropriate by the Fund.

IN WITNESS WHEREOF each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by its duly authorized representative
and its seal to be hereunder affixed hereto as of the date specified below.

CONNECTICUT GENERAL LIFE INSURANCE COMPANY

By: /s/ Karen R. Matheson
-------------------------------------------
Name: Karen R. Matheson
-------------------------------------
Title: Vice President
------------------------------------

[Signatures Continued On Next Page]

Page 15
<PAGE>

CIGNA VARIABLE PRODUCTS GROUP

By: /s/ Alfred A. Bingham III
-------------------------------------------
Name: Alfred A. Bingham III
------------------------------------
Title: Vice President and Treasurer
------------------------------------

CIGNA FINANCIAL ADVISORS, INC.

By: /s/ Karen R. Matheson
-------------------------------------------
Name: Karen R. Matheson
------------------------------------
Title: Vice President
------------------------------------

Page 16
<PAGE>

SCHEDULE A

The following is a list of separate accounts and contract forms for which one or
more portfolios of CIGNA Variable Products Group are to be made available by
Connecticut General Life Insurance Company:

Policy Form Numbers of Contracts Funded By
Name of Separate Account Separate Account
------------------------ ------------------------------------------

CG Variable Life Insurance XX605481 - Group Flexible Premium
Separate Account A, established Variable Life Insurance Policy, - Nonpar
May 22, 1995

CG Variable Life Insurance LN605, LN605 - and state variations
Separate Account II, established thereof
July 6, 1994

Page 17

<PAGE>

Exhibit (10)

[LETTERHEAD OF GOODWIN, PROCTER & HOAR LLP]

April 23, 1996

CIGNA Variable Products Group
1380 Main Street
Springfield, MA 01103

Ladies and Gentlemen:

Reference is made to the Post-Effective Amendment No. 12 to the
Registration Statement on Form N1-A (Registration No. 33-20333) filed with the
Securities and Exchange Commission with respect to the proposed sale of an
indefinite number of shares of beneficial interest, without par value (the
"Shares"), of the following series of CIGNA Variable Products Group, an
unincorporated association of the type commonly referred to as a Massachusetts
business trust (the "Trust"): CIGNA Variable Products S&P 500 Index Fund
(formerly, Companion Fund), CIGNA Variable Products High Yield Fund, CIGNA
Variable Products Income Fund, CIGNA Variable Products International Stock Fund,
and CIGNA Variable Products Money Market Fund.

In rendering the opinion set forth below, we have examined such corporate
records, documents and other instruments and have made such other examinations
and inquiries as we have deemed necessary to enable us to express the opinions
set forth herein. We have assumed that appropriate action has been or will be
taken prior to the issuance and sale of the Shares in order to comply with
applicable requirements of the laws of the various states or other
jurisdictions, with respect to the issuance and sale of such securities. Based
upon and subject to the foregoing, we are of the opinion that:

1. The Trust is duly formed and validly existing business trust under the
laws of the Commonwealth of Massachusetts; and

2. The Shares, when issued pursuant to the terms, provisions and
conditions set forth in the above-referenced Registration Statement relating to
the Shares, will be validly issued, fully paid and non-assessable by the Trust.
<PAGE>

GOODWIN, PROCTOR & HOAR LLP

CIGNA Variable Products Group
April 23, 1996
Page 2

We hereby consent to the filing of this opinion as an Exhibit to said
Registration Statement.

Very truly yours,

/s/ Goodwin, Procter & Hoar LLP

GOODWIN, PROCTOR & HOAR LLP

<PAGE>

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 12 to the registration statement on Form N-1A (the "Registration
Statement") of our report dated February 15, 1996, relating to the financial
statements and financial highlights appearing in the December 31, 1995 Annual
Report to Shareholders of CIGNA Variable Products S&P 500 Index Fund (formerly
Companion Fund), which is also incorporated by reference into the Registration
Statement. We also consent to the reference to us under the heading "Financial
Highlights" in the Prospectus and under the heading "Investment Advisory and
Other Services" in the Statement of Additional Information.

/s/ Price Waterhouse LLP

Price Waterhouse LLP
Boston, Massachusetts
April 18, 1996

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ANNUAL
REPORT FOR THE YEAR ENDED DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> S&P 500 INDEX FUND (FKA COMPANION FUND)

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 50,574,275
<INVESTMENTS-AT-VALUE> 66,475,529
<RECEIVABLES> 136,962
<ASSETS-OTHER> 1,398
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 66,613,889
<PAYABLE-FOR-SECURITIES> 198,392
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 132,386
<TOTAL-LIABILITIES> 330,778
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 50,441,483
<SHARES-COMMON-STOCK> 6,164,150
<SHARES-COMMON-PRIOR> 6,685,332
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 46,038
<ACCUMULATED-NET-GAINS> 61,404
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 15,826,262
<NET-ASSETS> 66,283,111
<DIVIDEND-INCOME> 1,471,083
<INTEREST-INCOME> 225,414
<OTHER-INCOME> 0
<EXPENSES-NET> 444,501
<NET-INVESTMENT-INCOME> 1,251,996
<REALIZED-GAINS-CURRENT> 1,677,326
<APPREC-INCREASE-CURRENT> 16,086,849
<NET-CHANGE-FROM-OPS> 19,016,171
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,638,540
<DISTRIBUTIONS-OF-GAINS> 1,065,000
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 161,710
<NUMBER-OF-SHARES-REDEEMED> 935,565
<SHARES-REINVESTED> 252,673
<NET-CHANGE-IN-ASSETS> 11,554,701
<ACCUMULATED-NII-PRIOR> (340,506)
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 550,922
<GROSS-ADVISORY-FEES> 213,557
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 444,501
<AVERAGE-NET-ASSETS> 61,045,664
<PER-SHARE-NAV-BEGIN> 8.19
<PER-SHARE-NII> 0.21
<PER-SHARE-GAIN-APPREC> 2.80
<PER-SHARE-DIVIDEND> 0.27
<PER-SHARE-DISTRIBUTIONS> 0.18
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 10.75
<EXPENSE-RATIO> 0.73
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE REPORT
FOR THE PERIOD MARCH 1, 1996 (COMMENCEMENT OF OPERATIONS) TO MARCH 31,1996 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 2
<NAME> MONEY MARKET FUND
<MULTIPLIER> 1,000

<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> MAR-01-1996
<PERIOD-END> MAR-31-1996
<INVESTMENTS-AT-COST> 4,987
<INVESTMENTS-AT-VALUE> 4,987
<RECEIVABLES> 7
<ASSETS-OTHER> 31
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 5,025
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6
<TOTAL-LIABILITIES> 6
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 5,019
<SHARES-COMMON-STOCK> 5,019
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 5,019
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 22
<OTHER-INCOME> 0
<EXPENSES-NET> 1
<NET-INVESTMENT-INCOME> 21
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 21
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 21
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 5,000
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 19
<NET-CHANGE-IN-ASSETS> 5,019
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4
<AVERAGE-NET-ASSETS> 5,010
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.004
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0.004
<PER-SHARE-DISTRIBUTIONS> 0.000
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.040
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>