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PACIFIC SELECT ESTATE PRESERVER II
Last Survivor Flexible Premium Variable Universal Life Insurance Policy
Issued by Pacific Life Insurance Company
Supplement dated December 17, 1999 to
Prospectus dated May 1, 1999
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This supplement changes the Prospectus to reflect the following effective
January 1, 2000:
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Two New Variable Investment The two new Variable Investment Options are added to the list on page 1 of the
Options Are Available Prospectus and the definition of Variable Account on page 3 of the Prospectus.
References to the 18 Variable Investment Options throughout the Prospectus are
. Diversified Research changed to refer to 20 Variable Investment Options.
. International Large-Cap
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The Names of Two Variable The Growth Variable Investment Option is now called the Small-Cap Equity
Investment Options Are Changed Variable Investment Option.
The International Variable Investment Option is now called the International
Value Variable Investment Option.
These new names reflect the change in name of the underlying Portfolios of
Pacific Select Fund. Throughout the Prospectus or supplement thereof, any
reference to the Growth or International Portfolio, Variable Account or
Variable Investment Option is changed to refer to the Small-Cap Equity or
International Value Portfolio, Variable Account or Variable Investment Option,
respectively.
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An Overview of Pacific Select Estate The following is added to the chart under Fees and Expenses Paid by the Pacific
Preserver II Is Amended Select Fund:
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Portfolio Advisory Fee Other Expenses Total Expenses+
-------------------------------------------------------------------------------
Diversified Research* 0.90% 0.05% 0.95%
International Large-Cap* 1.05% 0.15% 1.20%
* Expenses are estimated. There were no actual advisory fees or other expenses
for these Portfolios in 1998 because the Portfolios started on January 3,
2000. See page 13 of the Prospectus for information about expense caps
through December 31, 2000 for these Portfolios.
+ Effective January 1, 2000, the Fund will implement a brokerage enhancement
12b-1 plan, under which brokerage transactions may be placed with broker-
dealers in return for credits that may be used to help promote distribution
of Fund shares. There are no fees or charges to any Portfolio under this
plan, although the Fund's Distributor may defray expenses which it would
otherwise incur for distribution. If you assume the credits are a direct Fund
expense, the expense would have no effect on Other Expenses shown above.
The expenses for Equity Index in the chart under Fees and Expenses Paid by the
Pacific Select Fund are replaced with the following:
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Portfolio Advisory Fee Other Expenses Total Expenses+
-------------------------------------------------------------------------------
Equity Index 0.25% 0.05% 0.30%
1
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The Following Portfolios Have New Alliance Capital Management L.P. is the Portfolio Manager of the Emerging
Portfolio Managers Markets Portfolio.
Mercury Asset Management US is the Portfolio Manager of the Equity Index and
Small-Cap Index Portfolios.
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Your Investment Options Is The chart on page 13 of the Prospectus is replaced with the chart on page 3 of
Amended this supplement.
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Illustrations Is Amended The seventh and eighth bullet points under Assumptions are replaced:
. Illustrations 1 through 8 assume total annual advisory fees and expenses of
.80% of total average daily net assets of the Fund. This reflects average
advisory fees of .72% and average expenses of .08% based upon fees and
expenses of Portfolios available as Investment Options under the Policy.
. Illustrations 9 and 10 assume total annual advisory fees and expenses of .68%
of total average daily net assets of the Fund. This reflects weighted average
advisory fees of .61% and weighted average expenses of .07% based upon fees
and expenses of Portfolios available as Investment Options under the Policy.
The second bullet point under Things to keep in mind is replaced:
. After we've deducted the charges and fund expenses described in the
assumptions above, the illustrated gross annual investment rates of return of
0%, 6% and 12% correspond to approximate net annual rates of return of -.80%,
5.15%, and 11.10% for illustrations 1 through 8 and -.68%, 5.28%, and 11.24%
for illustrations 9 and 10.
Illustrations 1 through 10 are replaced with pages 4 through 13 of this
supplement.
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2
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THE FUND'S PROSPECTUS ACCOMPANIES THIS PROSPECTUS AND SHOULD BE READ
CAREFULLY BEFORE INVESTING.
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Primary Investments
Portfolio Objective (under normal circumstances) Portfolio Manager
- --------------------------------------------------------------------------------------------------------------------------------
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Aggressive Equity Capital appreciation. Equity securities of small Alliance Capital
emerging-growth companies Management L.P.
and medium-sized
companies.
- --------------------------------------------------------------------------------------------------------------------------------
Emerging Markets Long-term growth of capital. Equity securities of Alliance Capital
companies that are located Management L.P.
in countries generally
regarded as "emerging
market" countries.
- --------------------------------------------------------------------------------------------------------------------------------
Diversified Re- Long-term growth of capital. Equity securities of U.S. Capital Guardian
search companies and securities Trust Company
whose principal markets
are in the U.S.
- --------------------------------------------------------------------------------------------------------------------------------
Small-Cap Equity Growth of capital. Equity securities of Capital Guardian
(formerly called smaller and medium-sized Trust Company
Growth) companies.
- --------------------------------------------------------------------------------------------------------------------------------
International Long-term growth of capital. Equity securities of non- Capital Guardian
Large-Cap U.S. companies and Trust Company
securities whose principal
markets are outside of the
U.S.
- --------------------------------------------------------------------------------------------------------------------------------
Bond and Income Total return and income A wide range of fixed Goldman Sachs
consistent with prudent income securities with Asset Management
investment management. varying terms to maturity,
with an emphasis on long-
term bonds.
- --------------------------------------------------------------------------------------------------------------------------------
Equity Capital appreciation. Equity securities of large Goldman Sachs
Current income is of U.S. growth-oriented Asset Management
secondary importance. companies.
- --------------------------------------------------------------------------------------------------------------------------------
Multi-Strategy High total return. A mix of equity and fixed J.P. Morgan
income securities. Investment Management
Inc.
- --------------------------------------------------------------------------------------------------------------------------------
Equity Income Long-term growth of capital Equity securities of large J.P. Morgan
and income. and medium-sized dividend- Investment Management
paying U.S. companies. Inc.
- --------------------------------------------------------------------------------------------------------------------------------
Growth LT Long-term growth of capital Equity securities of a Janus Capital
consistent with the large number of companies Corporation
preservation of capital. of any size.
- --------------------------------------------------------------------------------------------------------------------------------
Mid-Cap Value Capital appreciation. Equity securities of Lazard Asset
medium-sized U.S. Management
companies believed to be
undervalued.
- --------------------------------------------------------------------------------------------------------------------------------
Equity Index Investment results that Equity securities of Mercury Asset
correspond to the total companies that are Management US
return of common stocks included in the Standard &
publicly traded in the U.S. Poor's 500 Composite Stock
Price Index.
- --------------------------------------------------------------------------------------------------------------------------------
Small-Cap Index Investment results that Equity securities of Mercury Asset
correspond to the total companies that are Management US
return of an index of small included in the Russell
capitalization companies. 2000 Small Stock Index.
- --------------------------------------------------------------------------------------------------------------------------------
REIT Current income and long-term Equity securities of real Morgan Stanley Asset
capital appreciation. estate investment trusts. Management
- --------------------------------------------------------------------------------------------------------------------------------
International Long-term capital Equity securities of Morgan Stanley Asset
Value appreciation primarily companies of any size Management
(formerly called through investment in equity located in developed
International) securities of corporations countries outside of the
domiciled in countries other U.S.
than the United States.
- --------------------------------------------------------------------------------------------------------------------------------
Government Maximize total return Fixed income securities Pacific Investment
Securities consistent with prudent that are issued or Management Company
investment management. guaranteed by the U.S.
government, its agencies
or government-sponsored
enterprises.
- --------------------------------------------------------------------------------------------------------------------------------
Managed Bond Maximize total return Medium and high-quality Pacific Investment
consistent with prudent fixed income securities Management Company
investment management. with varying terms to
maturity.
- --------------------------------------------------------------------------------------------------------------------------------
Money Market Current income consistent Highest quality money Pacific Life
with preservation of market instruments
capital. believed to have limited
credit risk.
- --------------------------------------------------------------------------------------------------------------------------------
High Yield Bond High level of current Fixed income securities Pacific Life
income. with lower and medium-
quality credit ratings and
intermediate to long terms
to maturity.
- --------------------------------------------------------------------------------------------------------------------------------
Large-Cap Value Long-term growth of capital. Equity securities of large Salomon Brothers
Current income is of U.S. companies. Asset Management Inc
secondary importance.
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3
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ILLUSTRATIONS
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Illustration 1
Death benefit Option A at current cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
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Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if ----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or partial withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 6 $232,002 $1,500,000 $1,500,000 $1,500,000
and Cash Surrender Values will differ if 7 $277,710 $1,500,000 $1,500,000 $1,500,000
premiums are paid in different amounts or 8 $325,704 $1,500,000 $1,500,000 $1,500,000
frequencies. 9 $376,097 $1,500,000 $1,500,000 $1,500,000
10 $429,010 $1,500,000 $1,500,000 $1,500,000
The hypothetical investment rates shown 15 $736,007 $1,500,000 $1,500,000 $1,500,000
above and elsewhere in this prospectus are 20 $1,127,822 $1,500,000 $1,500,000 $2,004,468
illustrative only and should not be 25 $1,627,888 $1,500,000 $1,500,000 $3,525,942
interpreted as a representation of past or 30 $2,266,113 $1,500,000 $1,978,406 $6,134,507
future investment results. Actual rates of 35 $3,080,667 $1,500,000 $2,687,518 $10,450,613
return may be more or less than those shown ----------------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these ----------------------------------------------------------------------------------
hypothetical rates of return can be 1 $26,532 $28,192 $29,853 $26,532 $28,192 $29,853
achieved for any one year or sustained over 2 $52,568 $57,537 $62,705 $52,568 $57,537 $62,705
any period of time. 3 $78,081 $88,057 $98,846 $78,081 $88,057 $98,846
4 $103,042 $119,779 $138,604 $103,042 $119,779 $138,604
This is an illustration only. An 5 $127,422 $152,727 $182,338 $127,422 $152,727 $182,338
illustration is not intended to predict 6 $151,302 $187,046 $230,573 $151,302 $187,046 $230,573
actual performance. Interest rates, 7 $174,886 $223,005 $284,004 $174,886 $223,005 $284,004
dividends, and values set forth in the 8 $198,209 $260,718 $343,230 $198,209 $260,718 $343,230
illustration are not guaranteed. 9 $221,273 $300,271 $408,884 $221,273 $300,271 $408,884
10 $244,082 $341,760 $481,671 $244,082 $341,760 $481,671
15 $368,093 $597,827 $1,001,836 $368,093 $597,827 $1,001,836
20 $482,859 $921,783 $1,873,334 $482,859 $921,783 $1,873,334
25 $582,449 $1,342,777 $3,358,040 $582,449 $1,342,777 $3,358,040
30 $637,075 $1,884,196 $5,842,388 $637,075 $1,884,196 $5,842,388
35 $580,974 $2,559,541 $9,952,965 $580,974 $2,559,541 $9,952,965
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4
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Illustration 2
Death benefit Option A at guaranteed cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
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Flexible premium survivorship variable Total
universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if -----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or partial withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
*Additional payment will be required to 6 $232,002 $1,500,000 $1,500,000 $1,500,000
prevent Policy termination. 7 $277,710 $1,500,000 $1,500,000 $1,500,000
8 $325,704 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 9 $376,097 $1,500,000 $1,500,000 $1,500,000
and Cash Surrender Values will differ if 10 $429,010 $1,500,000 $1,500,000 $1,500,000
premiums are paid in different amounts or 15 $736,007 $1,500,000 $1,500,000 $1,500,000
frequencies. 20 $1,127,822 $1,500,000 $1,500,000 $1,912,436
25 $1,627,888 $1,500,000 $1,500,000 $3,349,315
The hypothetical investment rates shown 30 $2,266,113 $0* $1,569,115 $5,754,205
above and elsewhere in this prospectus are 35 $3,080,667 $0* $2,115,294 $9,567,785
illustrative only and should not be -----------------------------------------------------------------------------------
interpreted as a representation of past or End of year End of year
future investment results. Actual rates of ACCUMULATED VALUE NET CASH SURRENDER VALUE
return may be more or less than those shown End of assuming hypothetical gross assuming hypothetical gross
and will depend on a number of factors, Policy annual investment return of annual investment return of
including the investment allocations made Year 0% 6% 12% 0% 6% 12%
to Variable Accounts by the Owner and the -----------------------------------------------------------------------------------
experience of the Accounts. No 1 $26,516 $28,175 $29,836 $26,516 $28,175 $29,836
representation can be made by us, the 2 $52,500 $57,465 $62,630 $52,500 $57,465 $62,630
Separate Account or the Fund that these 3 $77,918 $87,885 $98,664 $77,918 $87,885 $98,664
hypothetical rates of return can be 4 $102,739 $119,453 $138,253 $102,739 $119,453 $138,253
achieved for any one year or sustained over 5 $126,925 $152,185 $181,747 $126,925 $152,185 $181,747
any period of time. 6 $150,551 $186,216 $229,656 $150,551 $186,216 $229,656
7 $173,434 $221,425 $282,285 $173,434 $221,425 $282,285
This is an illustration only. An 8 $195,490 $257,792 $340,092 $195,490 $257,792 $340,092
illustration is not intended to predict 9 $216,607 $295,275 $403,574 $216,607 $295,275 $403,574
actual performance. Interest rates, 10 $236,659 $333,824 $473,298 $236,659 $333,824 $473,298
dividends, and values set forth in the 15 $330,209 $557,628 $962,423 $330,209 $557,628 $962,423
illustration are not guaranteed. 20 $369,378 $808,576 $1,787,324 $369,378 $808,576 $1,787,324
25 $289,040 $1,098,891 $3,189,824 $289,040 $1,098,891 $3,189,824
30 $0* $1,494,395 $5,480,196 $0* $1,494,395 $5,480,196
35 $0* $2,014,566 $9,112,177 $0* $2,014,566 $9,112,177
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5
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ILLUSTRATIONS
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Illustration 3
Death benefit Option B at current cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:B
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$121,904
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Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if ----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $127,999 $1,606,258 $1,612,702 $1,619,146
2 $262,398 $1,711,136 $1,730,633 $1,750,898
This illustration assumes no Policy loans 3 $403,517 $1,814,606 $1,854,004 $1,896,568
or partial withdrawals have been made. 4 $551,692 $1,916,639 $1,983,031 $2,057,608
5 $707,276 $2,017,201 $2,117,937 $2,235,620
The death benefits, Accumulated Values 6 $870,638 $2,116,366 $2,259,064 $2,432,495
and Cash Surrender Values will differ if 7 $1,042,169 $2,214,375 $2,406,949 $2,650,504
premiums are paid in different amounts or 8 $1,222,277 $2,311,275 $2,561,953 $2,891,962
frequencies. 9 $1,411,390 $2,407,078 $2,724,419 $3,159,392
10 $1,609,958 $2,501,795 $2,894,709 $3,455,591
The hypothetical investment rates shown 15 $2,762,035 $2,981,774 $3,903,663 $5,519,942
above and elsewhere in this prospectus are 20 $4,232,409 $3,431,189 $5,176,136 $8,957,069
illustrative only and should not be 25 $6,109,021 $3,853,460 $6,810,758 $14,788,665
interpreted as a representation of past or 30 $8,504,105 $4,183,540 $8,818,950 $24,521,394
future investment results. Actual rates of 35 $11,560,906 $4,311,767 $11,178,013 $41,119,512
return may be more or less than those shown ----------------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these ----------------------------------------------------------------------------------
hypothetical rates of return can be 1 $106,258 $112,702 $119,146 $106,258 $112,702 $119,146
achieved for any one year or sustained over 2 $211,136 $230,633 $250,898 $211,136 $230,633 $250,898
any period of time. 3 $314,606 $354,004 $396,568 $314,606 $354,004 $396,568
4 $416,639 $483,031 $557,608 $416,639 $483,031 $557,608
This is an illustration only. An 5 $517,201 $617,937 $735,620 $517,201 $617,937 $735,620
illustration is not intended to predict 6 $616,365 $759,064 $932,495 $616,365 $759,064 $932,495
actual performance. Interest rates, 7 $714,375 $906,949 $1,150,504 $714,375 $906,949 $1,150,504
dividends, and values set forth in the 8 $811,275 $1,061,953 $1,391,962 $811,275 $1,061,953 $1,391,962
illustration are not guaranteed. 9 $907,078 $1,224,419 $1,659,391 $907,078 $1,224,419 $1,659,391
10 $1,001,795 $1,394,709 $1,955,591 $1,001,795 $1,394,709 $1,955,591
15 $1,481,774 $2,403,663 $4,019,942 $1,481,774 $2,403,663 $4,019,942
20 $1,931,189 $3,676,136 $7,457,069 $1,931,189 $3,676,136 $7,457,069
25 $2,353,460 $5,310,758 $13,288,665 $2,353,460 $5,310,758 $13,288,665
30 $2,683,540 $7,318,951 $23,021,394 $2,683,540 $7,318,951 $23,021,394
35 $2,811,767 $9,678,013 $39,161,440 $2,811,767 $9,678,013 $39,161,440
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Illustration 4
Death benefit Option B at guaranteed cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:B
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$121,904
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Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if ----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $127,999 $1,606,242 $1,612,685 $1,619,129
2 $262,398 $1,711,065 $1,730,559 $1,750,821
This illustration assumes no Policy loans 3 $403,517 $1,814,436 $1,853,823 $1,896,376
or partial withdrawals have been made. 4 $551,692 $1,916,318 $1,982,684 $2,057,233
5 $707,276 $2,016,669 $2,117,351 $2,234,977
The death benefits, Accumulated Values 6 $870,638 $2,115,551 $2,258,153 $2,431,476
and Cash Surrender Values will differ if 7 $1,042,169 $2,212,766 $2,405,166 $2,648,523
premiums are paid in different amounts or 8 $1,222,277 $2,308,210 $2,558,562 $2,888,200
frequencies. 9 $1,411,390 $2,401,736 $2,718,482 $3,152,770
10 $1,609,958 $2,493,177 $2,885,045 $3,444,716
The hypothetical investment rates shown 15 $2,762,035 $2,934,936 $3,847,699 $5,452,458
above and elsewhere in this prospectus are 20 $4,232,409 $3,284,582 $4,989,176 $8,713,233
illustrative only and should not be 25 $6,109,021 $3,478,727 $6,304,844 $14,077,074
interpreted as a representation of past or 30 $8,504,105 $3,367,139 $7,651,150 $22,741,492
future investment results. Actual rates of 35 $11,560,906 $2,722,811 $8,764,327 $36,905,276
return may be more or less than those shown ----------------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these ----------------------------------------------------------------------------------
hypothetical rates of return can be 1 $106,242 $112,684 $119,129 $106,242 $112,684 $119,129
achieved for any one year or sustained over 2 $211,065 $230,559 $250,821 $211,065 $230,559 $250,821
any period of time. 3 $314,436 $353,823 $396,376 $314,436 $353,823 $396,376
4 $416,318 $482,684 $557,233 $416,318 $482,684 $557,233
This is an illustration only. An 5 $516,669 $617,351 $734,977 $516,669 $617,351 $734,977
illustration is not intended to predict 6 $615,551 $758,153 $931,476 $615,551 $758,153 $931,476
actual performance. Interest rates, 7 $712,766 $905,166 $1,148,523 $712,766 $905,166 $1,148,523
dividends, and values set forth in the 8 $808,210 $1,058,562 $1,388,199 $808,210 $1,058,562 $1,388,199
illustration are not guaranteed. 9 $901,736 $1,218,481 $1,652,769 $901,736 $1,218,481 $1,652,769
10 $993,177 $1,385,045 $1,944,716 $993,177 $1,385,045 $1,944,716
15 $1,434,936 $2,347,699 $3,952,458 $1,434,936 $2,347,699 $3,952,458
20 $1,784,582 $3,489,176 $7,213,233 $1,784,582 $3,489,176 $7,213,233
25 $1,978,727 $4,804,844 $12,577,074 $1,978,727 $4,804,844 $12,577,074
30 $1,867,138 $6,151,150 $21,241,492 $1,867,138 $6,151,150 $21,241,492
35 $1,222,811 $7,264,327 $35,147,884 $1,222,811 $7,264,327 $35,147,884
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7
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ILLUSTRATIONS
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Illustration 5
Death benefit Option C at current cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:C
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
----------------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if ----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,532,484 $1,532,484 $1,532,484
2 $69,922 $1,564,968 $1,564,968 $1,564,968
This illustration assumes no Policy loans 3 $107,526 $1,597,452 $1,597,452 $1,597,452
or partial withdrawals have been made. 4 $147,011 $1,629,936 $1,629,936 $1,629,936
5 $188,470 $1,662,420 $1,662,420 $1,662,420
The death benefits, Accumulated Values 6 $232,002 $1,694,905 $1,694,905 $1,694,905
and Cash Surrender Values will differ if 7 $277,710 $1,727,389 $1,727,389 $1,727,389
premiums are paid in different amounts or 8 $325,704 $1,759,873 $1,759,873 $1,759,873
frequencies. 9 $376,097 $1,792,357 $1,792,357 $1,792,357
10 $429,010 $1,824,841 $1,824,841 $1,824,841
The hypothetical investment rates shown 15 $736,007 $1,987,261 $1,987,261 $1,987,261
above and elsewhere in this prospectus are 20 $1,127,822 $2,149,682 $2,149,682 $2,149,682
illustrative only and should not be 25 $1,627,888 $2,312,102 $2,312,102 $3,492,956
interpreted as a representation of past or 30 $2,266,113 $2,474,523 $2,474,523 $6,079,140
future investment results. Actual rate's of 35 $3,080,667 $2,636,943 $2,636,943 $10,358,234
return may be more or less than those shown ----------------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these ----------------------------------------------------------------------------------
hypothetical rates of return can be 1 $26,530 $28,190 $29,851 $26,530 $28,190 $29,851
achieved for any one year or sustained over 2 $52,553 $57,521 $62,688 $52,553 $57,521 $62,688
any period of time. 3 $78,029 $88,002 $98,789 $78,029 $88,002 $98,789
4 $102,915 $119,644 $138,460 $102,915 $119,644 $138,460
This is an illustration only. An 5 $127,164 $152,449 $182,038 $127,164 $152,449 $182,038
illustration is not intended to predict 6 $150,834 $186,535 $230,014 $150,834 $186,535 $230,014
actual performance. Interest rates, 7 $174,165 $222,202 $283,110 $174,165 $222,202 $283,110
dividends, and values set forth in the 8 $197,194 $259,564 $341,918 $197,194 $259,564 $341,918
illustration are not guaranteed. 9 $219,923 $298,704 $407,062 $219,923 $298,704 $407,062
10 $242,354 $339,711 $479,234 $242,354 $339,711 $479,234
15 $363,784 $592,155 $994,233 $363,784 $592,155 $994,233
20 $473,071 $908,098 $1,855,003 $473,071 $908,098 $1,855,003
25 $552,802 $1,302,161 $3,326,625 $552,802 $1,302,161 $3,326,625
30 $534,336 $1,766,821 $5,789,657 $534,336 $1,766,821 $5,789,657
35 $219,527 $2,319,765 $9,864,985 $219,527 $2,319,765 $9,864,985
----------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
<TABLE>
<S> <C>
-----------------------------------------------------------------------------------
Illustration 6
Death benefit Option C at guaranteed cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:C
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
-----------------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if -----------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,532,484 $1,532,484 $1,532,484
2 $69,922 $1,564,968 $1,564,968 $1,564,968
This illustration assumes no Policy loans 3 $107,526 $1,597,452 $1,597,452 $1,597,452
or partial withdrawals have been made. 4 $147,011 $1,629,936 $1,629,936 $1,629,936
5 $188,470 $1,662,420 $1,662,420 $1,662,420
*Additional payment will be required to 6 $232,002 $1,694,905 $1,694,905 $1,694,905
prevent Policy termination. 7 $277,710 $1,727,389 $1,727,389 $1,727,389
8 $325,704 $1,759,873 $1,759,873 $1,759,873
The death benefits, Accumulated Values 9 $376,097 $1,792,357 $1,792,357 $1,792,357
and Cash Surrender Values will differ if 10 $429,010 $1,824,841 $1,824,841 $1,824,841
premiums are paid in different amounts or 15 $736,007 $1,987,261 $1,987,261 $1,987,261
frequencies. 20 $1,127,822 $2,149,682 $2,149,682 $2,149,682
25 $1,627,888 $2,312,102 $2,312,102 $3,160,152
The hypothetical investment rates shown 30 $2,266,113 $0* $2,474,523 $5,441,306
above and elsewhere in this prospectus are 35 $3,080,667 $0* $0* $9,059,018
illustrative only and should not be -----------------------------------------------------------------------------------
interpreted as a representation of past or End of year End of year
future investment results. Actual rates of ACCUMULATED VALUE NET CASH SURRENDER VALUE
return may be more or less than those shown End of assuming hypothetical gross assuming hypothetical gross
and will depend on a number of factors, Policy annual investment return of annual investment return of
including the investment allocations made Year 0% 6% 12% 0% 6% 12%
to Variable Accounts by the Owner and the -----------------------------------------------------------------------------------
experience of the Accounts. No 1 $26,514 $28,173 $29,833 $26,514 $28,173 $29,833
representation can be made by us, the 2 $52,482 $57,446 $62,611 $52,482 $57,446 $62,611
Separate Account or the Fund that these 3 $77,857 $87,820 $98,596 $77,857 $87,820 $98,596
hypothetical rates of return can be 4 $102,590 $119,294 $138,084 $102,590 $119,294 $138,084
achieved for any one year or sustained over 5 $126,622 $151,858 $181,394 $126,622 $151,858 $181,394
any period of time. 6 $150,001 $185,615 $228,998 $150,001 $185,615 $228,998
7 $172,509 $220,401 $281,151 $172,509 $220,401 $281,151
This is an illustration only. An 8 $194,016 $256,141 $338,241 $194,016 $256,141 $338,241
illustration is not intended to predict 9 $214,348 $292,717 $400,669 $214,348 $292,717 $400,669
actual performance. Interest rates, 10 $233,300 $329,980 $468,882 $233,300 $329,980 $468,882
dividends, and values set forth in the 15 $312,739 $536,586 $936,749 $312,739 $536,586 $936,749
illustration are not guaranteed. 20 $303,189 $724,974 $1,689,455 $303,189 $724,974 $1,689,455
25 $61,053 $796,842 $3,009,669 $61,053 $796,842 $3,009,669
30 $0* $438,600 $5,182,196 $0* $438,600 $5,182,196
35 $0* $0* $8,627,637 $0* $0* $8,627,637
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9
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATIONS
<S> <C>
--------------------------------------------------------------------------------
Illustration 7
Death benefit Option D at current cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:D
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
--------------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if --------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,503,000 $1,503,000 $1,503,000
This illustration assumes no policy loans 3 $107,526 $1,506,000 $1,506,000 $1,506,000
or partial withdrawals have been made. 4 $147,011 $1,510,500 $1,510,500 $1,510,500
5 $188,470 $1,516,500 $1,516,500 $1,516,500
The death benefits, Accumulated Values 6 $232,002 $1,522,500 $1,522,500 $1,522,500
and Cash Surrender Values will differ if 7 $277,710 $1,530,000 $1,530,000 $1,530,000
premiums are paid in different amounts or 8 $325,704 $1,539,000 $1,539,000 $1,539,000
frequencies. 9 $376,097 $1,549,500 $1,549,500 $1,549,500
10 $429,010 $1,563,000 $1,563,000 $1,563,000
The hypothetical investment rates shown 15 $736,007 $1,675,500 $1,675,500 $1,675,500
above and elsewhere in this prospectus are 20 $1,127,822 $1,903,500 $1,903,500 $1,999,427
illustrative only and should not be 25 $1,627,888 $2,317,500 $2,317,500 $3,517,619
interpreted as a representation of past or 30 $2,266,113 $2,766,000 $2,766,000 $6,120,537
future investment results. Actual rates of 35 $3,080,667 $3,000,000 $3,000,000 $10,427,305
return may be more or less than those shown --------------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these --------------------------------------------------------------------------------
hypothetical rates of return can be 1 $26,532 $28,192 $29,853 $26,532 $28,192 $29,853
achieved for any one year or sustained over 2 $52,568 $57,536 $62,704 $52,568 $57,536 $62,704
any period of time. 3 $78,078 $88,054 $98,843 $78,078 $88,054 $98,843
4 $103,033 $119,769 $138,594 $103,033 $119,769 $138,594
This is an illustration only. An 5 $127,400 $152,704 $182,312 $127,400 $152,704 $182,312
illustration is not intended to predict 6 $151,255 $186,996 $230,519 $151,255 $186,996 $230,519
actual performance. Interest rates, 7 $174,806 $222,917 $283,908 $174,806 $222,917 $283,908
dividends, and values set forth in the 8 $198,084 $260,579 $343,075 $198,084 $260,579 $343,075
illustration are not guaranteed. 9 $221,092 $300,065 $408,650 $221,092 $300,065 $408,650
10 $243,826 $341,465 $481,331 $243,826 $341,465 $481,331
15 $367,066 $596,564 $1,000,260 $367,066 $596,564 $1,000,260
20 $478,875 $916,802 $1,868,623 $478,875 $916,802 $1,868,623
25 $560,725 $1,316,303 $3,350,114 $560,725 $1,316,303 $3,350,114
30 $526,765 $1,769,001 $5,829,083 $526,765 $1,769,001 $5,829,083
35 $126,445 $2,227,111 $9,930,767 $126,445 $2,227,111 $9,930,767
--------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
<TABLE>
<S> <C>
----------------------------------------------------------------------------------
Illustration 8
Death benefit Option D at guaranteed cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:D
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
----------------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as ----------------------------------------------------------------------------------
if made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,503,000 $1,503,000 $1,503,000
This illustration assumes no Policy loans 3 $107,526 $1,506,000 $1,506,000 $1,506,000
or partial withdrawals have been made. 4 $147,011 $1,510,500 $1,510,500 $1,510,500
5 $188,470 $1,516,500 $1,516,500 $1,516,500
*Additional payment will be required to 6 $232,002 $1,522,500 $1,522,500 $1,522,500
prevent Policy termination. 7 $277,710 $1,530,000 $1,530,000 $1,530,000
8 $325,704 $1,539,000 $1,539,000 $1,539,000
The death benefits, Accumulated Values 9 $376,097 $1,549,500 $1,549,500 $1,549,500
and Cash Surrender Values will differ 10 $429,010 $1,563,000 $1,563,000 $1,563,000
if premiums are paid in different amounts or 15 $736,007 $1,675,500 $1,675,500 $1,675,500
frequencies. 20 $1,127,822 $1,903,500 $1,903,500 $1,903,500
25 $1,627,888 $2,317,500 $2,317,500 $3,289,425
The hypothetical investment rates shown 30 $2,266,113 $0* $2,766,000 $5,655,137
above and elsewhere in this prospectus are 35 $3,080,667 $0* $0* $9,406,702
illustrative only and should not be ----------------------------------------------------------------------------------
interpreted as a representation of past or End of year End of year
future investment results. Actual rates of ACCUMULATED VALUE NET CASH SURRENDER VALUE
return may be more or less than those shown End of assuming hypothetical gross assuming hypothetical gross
and will depend on a number of factors, Policy annual investment return of annual investment return of
including the investment allocations made Year 0% 6% 12% 0% 6% 12%
to Variable Accounts by the Owner and the ----------------------------------------------------------------------------------
experience of the Accounts. No 1 $26,516 $28,175 $29,836 $26,516 $28,175 $29,836
representation can be made by us, the 2 $52,499 $57,464 $62,629 $52,499 $57,464 $62,629
Separate Account or the Fund that these 3 $77,915 $87,881 $98,660 $77,915 $87,881 $98,660
hypothetical rates of return can be 4 $102,728 $119,442 $138,241 $102,728 $119,442 $138,241
achieved for any one year or sustained over 5 $126,899 $152,158 $181,717 $126,899 $152,158 $181,717
any period of time. 6 $150,496 $186,157 $229,592 $150,496 $186,157 $229,592
7 $173,329 $221,311 $282,161 $173,329 $221,311 $282,161
This is an illustration only. An 8 $195,303 $257,587 $339,866 $195,303 $257,587 $339,866
illustration is not intended to predict a 9 $216,286 $294,919 $403,179 $216,286 $294,919 $403,179
ctual performance. Interest rates, 10 $236,124 $333,226 $472,628 $236,124 $333,226 $472,628
dividends, and values set forth in the 15 $325,360 $552,024 $955,896 $325,360 $552,024 $955,896
illustration are not guaranteed. 20 $338,815 $772,212 $1,753,941 $338,815 $772,212 $1,753,941
25 $120,948 $892,724 $3,132,786 $120,948 $892,724 $3,132,786
30 $0* $522,395 $5,385,845 $0* $522,395 $5,385,845
35 $0* $0* $8,958,764 $0* $0* $8,958,764
----------------------------------------------------------------------------------
11
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ILLUSTRATIONS
<S> <C>
-----------------------------------------------------------------------------
Illustration 9
Death benefit Option A at current cost of insurance rates
Based on a weighted average of annual advisory fees and expenses of the
Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
-----------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if -----------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or partial withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 6 $232,002 $1,500,000 $1,500,000 $1,500,000
and Cash Surrender Values will differ if 7 $277,710 $1,500,000 $1,500,000 $1,500,000
premiums are paid in different amounts or 8 $325,704 $1,500,000 $1,500,000 $1,500,000
frequencies. 9 $376,097 $1,500,000 $1,500,000 $1,500,000
10 $429,010 $1,500,000 $1,500,000 $1,500,000
The hypothetical investment rates shown 15 $736,007 $1,500,000 $1,500,000 $1,500,000
above and elsewhere in this prospectus are 20 $1,127,822 $1,500,000 $1,500,000 $2,037,802
illustrative only and should not be 25 $1,627,888 $1,500,000 $1,500,000 $3,602,209
interpreted as a representation of past or 30 $2,266,113 $1,500,000 $2,024,938 $6,300,010
future investment results. Actual rates of 35 $3,080,667 $1,500,000 $2,762,703 $10,791,300
return may be more or less than those shown -----------------------------------------------------------------------------
and will depend on a number of factors, End of year End of year
including the investment allocations made ACCUMULATED VALUE NET CASH SURRENDER VALUE
to Variable Accounts by the Owner and the End of assuming hypothetical gross assuming hypothetical gross
experience of the Accounts. No Policy annual investment return of annual investment return of
representation can be made by us, the Year 0% 6% 12% 0% 6% 12%
Separate Account or the Fund that these -----------------------------------------------------------------------------
hypothetical rates of return can be 1 $26,566 $28,228 $29,891 $26,566 $28,228 $29,891
achieved for any one year or sustained over 2 $52,667 $57,645 $62,824 $52,667 $57,645 $62,824
any period of time. 3 $78,274 $88,279 $99,100 $78,274 $88,279 $99,100
4 $103,360 $120,159 $139,054 $103,360 $120,159 $139,054
This is an illustration only. An 5 $127,893 $153,313 $183,060 $127,893 $153,313 $183,060
illustration is not intended to predict 6 $151,954 $187,890 $231,656 $151,954 $187,890 $231,656
actual performance. Interest rates, 7 $175,747 $224,164 $285,552 $175,747 $224,164 $285,552
dividends, and values set forth in the 8 $199,304 $262,253 $345,367 $199,304 $262,253 $345,367
illustration are not guaranteed. 9 $222,629 $302,250 $411,754 $222,629 $302,250 $411,754
10 $245,724 $344,255 $485,442 $245,724 $344,255 $485,442
15 $371,571 $604,282 $1,013,864 $371,571 $604,282 $1,013,864
20 $488,822 $935,328 $1,904,487 $488,822 $935,328 $1,904,487
25 $591,646 $1,368,563 $3,430,676 $591,646 $1,368,563 $3,430,676
30 $650,526 $1,928,513 $6,000,010 $650,526 $1,928,513 $6,000,010
35 $601,108 $2,631,146 $10,277,429 $601,108 $2,631,146 $10,277,429
-----------------------------------------------------------------------------
</TABLE>
12
<PAGE>
<TABLE>
<S> <C>
------------------------------------------------------------------------------
Illustration 10
Death benefit Option A at guaranteed cost of insurance rates
Based on a weighted average of annual advisory fees and expenses of the
Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE SELECT NONSMOKER ISSUE AGE 55
FEMALE SELECT NONSMOKER ISSUE AGE 55
GUIDELINE PREMIUM TEST
ANNUAL PREMIUM:$32,484
------------------------------------------------------------------------------
Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if ------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or partial withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
*Additional payment will be required to 6 $232,002 $1,500,000 $1,500,000 $1,500,000
prevent Policy termination. 7 $277,710 $1,500,000 $1,500,000 $1,500,000
8 $325,704 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 9 $376,097 $1,500,000 $1,500,000 $1,500,000
and Cash Surrender Values will differ if 10 $429,010 $1,500,000 $1,500,000 $1,500,000
premiums are paid in different amounts or 15 $736,007 $1,500,000 $1,500,000 $1,500,000
frequencies. 20 $1,127,822 $1,500,000 $1,500,000 $1,946,041
25 $1,627,888 $1,500,000 $1,500,000 $3,424,542
The hypothetical investment rates shown 30 $2,266,113 $0* $1,630,790 $5,913,806
above and elsewhere in this prospectus are 35 $3,080,667 $0* $2,204,315 $9,886,393
illustrative only and should not be ------------------------------------------------------------------------------
interpreted as a representation of past or End of year End of year
future investment results. Actual rates of ACCUMULATED VALUE NET CASH SURRENDER VALUE
return may be more or less than those shown End of assuming hypothetical gross assuming hypothetical gross
and will depend on a number of factors, Policy annual investment return of annual investment return of
including the investment allocations made Year 0% 6% 12% 0% 6% 12%
to Variable Accounts by the Owner and the ------------------------------------------------------------------------------
experience of the Accounts. No 1 $26,550 $28,211 $29,873 $26,550 $28,211 $29,873
representation can be made by us, the 2 $52,598 $57,573 $62,749 $52,598 $57,573 $62,749
Separate Account or the Fund that these 3 $78,111 $88,106 $98,917 $78,111 $88,106 $98,917
hypothetical rates of return can be 4 $103,056 $119,832 $138,703 $103,056 $119,832 $138,703
achieved for any one year or sustained over 5 $127,396 $152,770 $182,468 $127,396 $152,770 $182,468
any period of time. 6 $151,202 $187,058 $230,737 $151,202 $187,058 $230,737
7 $174,292 $222,581 $283,830 $174,292 $222,581 $283,830
This is an illustration only. An 8 $196,581 $259,323 $342,224 $196,581 $259,323 $342,224
illustration is not intended to predict 9 $217,956 $297,247 $406,437 $217,956 $297,247 $406,437
actual performance. Interest rates, 10 $238,290 $336,309 $477,060 $238,290 $336,309 $477,060
dividends, and values set forth in the 15 $333,624 $564,059 $974,525 $333,624 $564,059 $974,525
illustration are not guaranteed. 20 $375,183 $822,390 $1,818,730 $375,183 $822,390 $1,818,730
25 $298,125 $1,127,634 $3,261,469 $298,125 $1,127,634 $3,261,469
30 $0* $1,553,134 $5,632,196 $0* $1,553,134 $5,632,196
35 $0* $2,099,347 $9,415,613 $0* $2,099,347 $9,415,613
------------------------------------------------------------------------------
13
</TABLE>
<PAGE>
Form No. 15-22032-00
<PAGE>
Supplement dated December 17, 1999 to Prospectus Dated May 1, 1999 for
Pacific Select Estate Preserver II
Last Survivor Flexible Premium Variable Life Insurance Policies
Issued by Pacific Life Insurance Company
<TABLE>
<S> <C>
In this supplement, you and your mean the This supplement provides information about four additional Variable Investment
Policyholder or Owner. Pacific Life, we, us, Options offered under this Policy. Each of these Investment Options is set up
and our refer to Pacific Life Insurance as a Variable Account under our Separate Account and invests in a corresponding
Company. M Fund refers to M Fund, Inc. Portfolio of the M Fund.
You'll find an explanation of
what capitalized terms mean in the Variable Account I: Brandes International Equity Fund
accompanying variable life insurance Variable Account II: Turner Core Growth Fund
prospectus or the M Fund prospectus. Variable Account III: Frontier Capital Appreciation Fund
Variable Account IV: Enhanced U.S. Equity Fund
The M Fund is described in detail in its
prospectus and in its Statement of You can allocate premium payments and transfer Accumulated Value to these
Additional Information (SAI). Variable Investment Options, as well as to the other Investment Options
described in the accompanying Pacific Select Estate Preserver II prospectus.
Pacific Select Estate Preserver II is
described in detail in the accompanying INFORMATION ABOUT M FUND
variable life insurance prospectus. Except
as described below, all features and M Fund, Inc.
procedures of the Policy described in its M Fund is a diversified, open-end management investment company registered with
prospectus remain intact. the Securities and Exchange Commission ("SEC") under the Investment Company Act
of 1940. M Fund currently offers four separate Portfolios as Investment Options
under the Policies. Each Portfolio pursues different investment objectives and
policies. The shares of each Portfolio are purchased by us for the
corresponding Variable Account at net asset value, i.e., without sales load.
All dividends and capital gains distributions received from a Portfolio are
automatically reinvested in such Portfolio at net asset value, unless we, on
behalf of the Separate Account, elect otherwise. M Fund shares may be redeemed
by us at their net asset value to the extent necessary to make payments under
the Policies.
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Your Policy's Accumulated The following chart is a summary of the M Fund Portfolios. You'll find detailed
Value will fluctuate descriptions of the Portfolios, including the risks associated with investing
depending on the Investment in the Portfolios, in the M Fund prospectus. There's no guarantee that a
Options you've chosen. Portfolio will achieve its investment objective. You should read the M Fund
prospectus carefully before investing.
The Portfolio's The Portfolio's Main
Portfolio Investment Goal Investments Portfolio Manager
Brandes Long-term capital Equity securities of foreign Brandes Investment
International appreciation. issuers, including common stocks, Partners, L.P.
Equity preferred stocks and securities
that are convertible into common
stocks. Focuses on stocks with
capitalizations of $1 billion
or more.
Turner Core Long-term capital Common stocks that show strong Turner Investment
Growth Fund appreciation. earnings potential and also have Partners, Inc.
reasonable valuations.
Frontier
Capital Maximum capital Common stock of companies of all Frontier Capital
Appreciation appreciation. sizes with emphasis on stocks Management
companies with capitalizations of Company, Inc.
less than $3 billion.
Enhanced U.S. Above-market Common stocks of U.S. companies Franklin Portfolio
Equity total return. which the portfolio manager Associates LLC
believes have the potential for
higher rates of return than the
Standard & Poor's 500 Composite
Stock Price Index while having
risks similar to those of the
index.
We are not responsible for M Financial Investment Advisers, Inc. (MFIA) is the investment adviser for each
the operation of the M Fund or Portfolio of the M Fund, and has retained other firms to manage the Portfolios.
any of its Portfolios. We also MFIA and the M Fund's Board of Directors oversee the management of all of the M
are not responsible for ensuring Fund's Portfolios.
that the M Fund and its
Portfolios comply with any
laws that apply.
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You'll find more information about Policy Fees and Expenses Paid by the M Fund
charges in An Overview of Pacific Select The M Fund pays advisory fees and other expenses. These are deducted from the
Estate Preserver II in the accompanying assets of each Portfolio and may vary from year to year. They are not fixed and
variable life insurance prospectus. are not part of the terms of your Policy. If you choose a Variable Investment
Option, these fees and expenses affect you indirectly because they reduce
You'll find more about M Fund fees and Portfolio returns.
expenses in the accompanying
M Fund prospectus. M Fund's expenses are assessed at the Fund level and are not direct charges
against the Variable Accounts or the Policy's Accumulated Value. These expenses
are taken into account in computing each Portfolio's net asset value. We in
turn use each Portfolio's net asset value to compute the corresponding Variable
Account's Accumulation Unit Value.
. Advisory fee
MFIA is the investment adviser to the M Fund. The M Fund pays an advisory fee
to MFIA for these services. The table below shows the advisory fee as an
annual percentage of each Portfolio's average daily net assets.
. Other expenses
The table also shows expenses the M Fund paid in 1998 as an annual percentage
of each Portfolio's average daily net assets. MFIA has agreed to pay operating
expenses of the M Fund (not including brokerage or other Portfolio transaction
expenses, expenses for litigation, indemnification, taxes, or other
extraordinary expenses) that exceed 0.25% of each Portfolio's average daily
net assets. MFIA does this voluntarily, but does not guarantee that it will
continue to do so after December 31, 1999.
M Fund Expenses after Expense Limitation/1/
Advisory Other Total
fee expenses expenses
-------- -------- --------
Brandes International Equity 1.05% 0.25% 1.30%
Turner Core Growth 0.45% 0.25% 0.70%
Frontier Capital Appreciation 0.90% 0.25% 1.15%
Enhanced U.S. Equity 0.55% 0.25% 0.80%
/1/ Actual expenses for 1998 were 3.57% for Brandes International Equity
Portfolio, 3.42% for Turner Core Growth Portfolio, 1.75% for Frontier Capital
Appreciation Portfolio, and 2.34% for Enhanced U.S. Equity Portfolio. MFIA paid
the difference.
Statements and reports we'll send you
We'll send you financial statements that we receive from M Fund.
The rights we describe in the Voting rights
accompanying variable life insurance We're the legal owner of the shares of the M Fund that are held by the Variable
prospectus under Disregard of Voting Accounts. The voting rights we describe in the Voting of Fund Shares section of
Instructions and Substitution of the accompanying variable life insurance prospectus and how we'll exercise them
Investments also apply to the M Fund. also apply to the M Fund.
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ILLUSTRATIONS
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If you ask us, we'll provide you with Illustrations 1 and 2, which appear on the following pages, illustrate how the
different kinds of illustrations: death benefit, Accumulated Value and Net Cash Surrender Value of a hypothetical
. Illustrations similar to the ones in the Policy may vary over an extended period of time, based on certain hypothetical
prospectus and this supplement, but rates of return.
based on information you give us about
the Ages of the two people to be These illustrations are based on a hypothetical Policy with the following
insured by the Policy, their risk characteristics:
classes, the Face Amount, the death
benefit and premium payments. . the Face Amount is $1,500,000
. Illustrations that show the allocation . the annual premium is $32,484
of premium payments to specified Variable
Accounts. These will reflect the . on the Policy Date, the people insured by the Policy are
expenses of the Portfolio in which the
Variable Account invests. - a 55-year old male select nonsmoker
. Illustrations that use a hypothetical - a 55-year old female select nonsmoker
gross rate of return that's greater than
12%. These are available only to certain The cost of insurance rates vary by illustration, as follows:
large institutional investors. ----------------------------------------------
Cost of insurance rate
----------------------------------------------
Illustration 1 Current
Illustration 2 Guaranteed
----------------------------------------------
Assumptions
The illustrations are based on the guideline premium test. Here are the
assumptions we're using:
. The hypothetical rates of return are equal to constant gross annual rates of
0%, 6% and 12%.
. All premium payments are made at the beginning of the Policy Year.
. An amount equal to the annual premium, after taxes, is invested to earn
interest at 5% compounded annually for the second column of each table, Total
premiums paid plus interest at 5%, which shows the amount that would
accumulate.
. No Policy loans have been taken out.
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. The amounts shown for the death benefits, Accumulated Values and Net Cash
Surrender Values reflect charges deducted from the Variable Accounts. This
means that the net investment return on the Variable Accounts is lower than
the gross investment return on the assets.
. The amounts shown for the death benefits, Accumulated Values and Net Cash
Surrender Values also reflect premium loads, administrative charges and
mortality and expense risk charges.
The Pacific Select Fund's investment . The Illustrations assume total annual advisory fees and expenses of .80% of
advisory fees and expenses are shown total average daily net assets of the Fund. This reflects average advisory
in An Overview of Pacific Select Estate fees of .69% and average expenses of .11% based upon fees and expenses of
Preserver II. Portfolios available as Investment Options under the Policy.
The M Fund's investment advisory fees . There are no charges against the Variable Accounts for income taxes but we
and expenses are shown on page 3 of reserve the right to impose charges in the future.
this supplement.
Things to keep in mind
Here are a few things to keep in mind when reviewing the illustrations:
. The values shown would be different if, although the gross annual investment
rates of return averaged 0%, 6% or 12% over a period of years, they also rose
above or fell below those averages for individual Policy years.
. After we've deducted the charges and fund expenses described in the
assumptions above, the illustrated gross annual investment rates of return of
0%, 6% and 12% correspond to approximate net annual rates of return of -.80%,
5.15%, and 11.10%.
. The amounts shown would be different if unisex insurance rates were used or if
the people were insured by the Policy were females and insurance rates for
females were used.
. For the illustration that assumes current cost of insurance rates, the amounts
shown would be different if either person insured by the Policy was a smoker
and rates for smokers were used.
. The Portfolio expenses used in the illustrations do not include foreign taxes.
Here's what foreign taxes were for the year ended December 31, 1998:
-------------------------------------------------------
Percentage of average
Portfolio daily net assets
-------------------------------------------------------
Pacific Select Fund:
Aggressive Equity 0.01%
Growth LT 0.01%
Equity Income 0.01%
Equity Index 0.01%
International 0.23%
Emerging Markets 0.26%
M Fund:
Brandes International Equity 0.18%
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Illustration 1
Death benefit Option A at current cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE NONSMOKER ISSUE AGE 55
FEMALE NONSMOKER ISSUE AGE 55
ANNUAL PREMIUM:$32,484
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Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if --------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or Partial Withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 6 $232,002 $1,500,000 $1,500,000 $1,500,000
and Net Cash Surrender Values will differ 7 $277,710 $1,500,000 $1,500,000 $1,500,000
if premiums are paid in different amounts 8 $325,704 $1,500,000 $1,500,000 $1,500,000
or frequencies. 9 $376,097 $1,500,000 $1,500,000 $1,500,000
10 $429,010 $1,500,000 $1,500,000 $1,500,000
The hypothetical investment rates shown 15 $736,007 $1,500,000 $1,500,000 $1,500,000
above and elsewhere in this prospectus 20 $1,127,822 $1,500,000 $1,500,000 $1,996,218
are illustrative only and should not be 25 $1,627,888 $1,500,000 $1,500,000 $3,507,128
interpreted as a representation of past or 30 $2,266,113 $1,500,000 $1,966,929 $6,093,817
future investment results. Actual rates of 35 $3,080,667 $1,500,000 $2,669,040 $10,367,141
return may be more or less than those --------------------------------------------------------------------------------
shown and will depend on a number of End of year End of year
factors, including the investment ACCUMULATED VALUE NET CASH SURRENDER VALUE
allocations made to Variable Accounts by End of assuming hypothetical gross assuming hypothetical gross
the Owner and the experience of the Policy annual investment return of annual investment return of
Accounts. No representation can be Year 0% 6% 12% 0% 6% 12%
made by us, the Separate Account or the --------------------------------------------------------------------------------
underlying funds that these hypothetical 1 $26,524 $28,183 $29,844 $26,524 $28,183 $29,844
rates of return can be achieved for any 2 $52,544 $57,510 $62,675 $52,544 $57,510 $62,675
one year or sustained over any period of 3 $78,032 $88,001 $98,783 $78,032 $88,001 $98,783
time. 4 $102,962 $119,684 $138,491 $102,962 $119,684 $138,491
5 $127,304 $152,581 $182,157 $127,304 $152,581 $182,157
This is an illustration only. An 6 $151,139 $186,836 $230,303 $151,139 $186,836 $230,303
illustration is not intended to predict 7 $174,671 $222,716 $283,618 $174,671 $222,716 $283,618
actual performance. Interest rates, 8 $197,936 $260,335 $342,697 $197,936 $260,335 $342,697
dividends, and values set forth in the 9 $220,936 $299,778 $408,170 $220,936 $299,778 $408,170
illustration are not guaranteed. 10 $243,673 $341,138 $480,732 $243,673 $341,138 $480,732
15 $367,228 $596,224 $998,851 $367,228 $596,224 $998,851
20 $481,380 $918,428 $1,865,624 $481,380 $918,428 $1,865,624
25 $580,174 $1,336,411 $3,340,122 $580,174 $1,336,411 $3,340,122
30 $633,759 $1,873,266 $5,803,636 $633,759 $1,873,266 $5,803,636
35 $576,026 $2,541,943 $9,873,468 $576,026 $2,541,943 $9,873,468
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Illustration 2
Death benefit Option A at guaranteed cost of insurance rates
Based on average annual advisory fees and expenses of the Portfolios
DEATH BENEFIT OPTION:A
FACE AMOUNT:$1,500,000
MALE NONSMOKER ISSUE AGE 55
FEMALE NONSMOKER ISSUE AGE 55
ANNUAL PREMIUM:$32,484
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Flexible premium survivorship Total
variable universal life premiums
Illustration of death benefits, Accumulated End of paid plus End of year DEATH BENEFIT assuming
Values and Net Cash Surrender Values. Policy interest at hypothetical gross annual investment return of
Year 5% 0% 6% 12%
All premium payments are illustrated as if --------------------------------------------------------------------------------
made at the beginning of the Policy Year. 1 $34,108 $1,500,000 $1,500,000 $1,500,000
2 $69,922 $1,500,000 $1,500,000 $1,500,000
This illustration assumes no Policy loans 3 $107,526 $1,500,000 $1,500,000 $1,500,000
or Partial Withdrawals have been made. 4 $147,011 $1,500,000 $1,500,000 $1,500,000
5 $188,470 $1,500,000 $1,500,000 $1,500,000
*Additional payment will be required to 6 $232,002 $1,500,000 $1,500,000 $1,500,000
prevent Policy termination. 7 $277,710 $1,500,000 $1,500,000 $1,500,000
8 $325,704 $1,500,000 $1,500,000 $1,500,000
The death benefits, Accumulated Values 9 $376,097 $1,500,000 $1,500,000 $1,500,000
and Net Cash Surrender Values will differ 10 $429,010 $1,500,000 $1,500,000 $1,500,000
if premiums are paid in different amounts 15 $736,007 $1,500,000 $1,500,000 $1,500,000
or frequencies. 20 $1,127,822 $1,500,000 $1,500,000 $1,904,114
25 $1,627,888 $1,500,000 $1,500,000 $3,330,747
The hypothetical investment rates shown 30 $2,266,113 $0* $1,553,661 $5,714,953
above and elsewhere in this prospectus 35 $3,080,667 $0* $2,093,146 $9,489,703
are illustrative only and should not be --------------------------------------------------------------------------------
interpreted as a representation of past or End of year End of year
future investment results. Actual rates of ACCUMULATED VALUE NET CASH SURRENDER VALUE
return may be more or less than those End of assuming hypothetical gross assuming hypothetical gross
shown and will depend on a number of Policy annual investment return of annual investment return of
factors, including the investment Year 0% 6% 12% 0% 6% 12%
allocations made to Variable Accounts by --------------------------------------------------------------------------------
the Owner and the experience of the 1 $26,508 $28,167 $29,827 $26,508 $28,167 $29,827
Accounts. No representation can be 2 $52,475 $57,438 $62,600 $52,475 $57,438 $62,600
made by us, the Separate Account or the 3 $77,870 $87,829 $98,601 $77,870 $87,829 $98,601
underlying funds that these hypothetical 4 $102,660 $119,358 $138,141 $102,660 $119,358 $138,141
rates of return can be achieved for any 5 $126,808 $152,039 $181,566 $126,808 $152,039 $181,566
one year or sustained over any period of 6 $150,389 $186,006 $229,386 $150,389 $186,006 $229,386
time. 7 $173,220 $221,137 $281,900 $173,220 $221,137 $281,900
8 $195,218 $257,411 $339,561 $195,218 $257,411 $339,561
This is an illustration only. An 9 $216,271 $294,784 $402,861 $216,271 $294,784 $402,861
illustration is not intended to predict 10 $236,253 $333,205 $472,361 $236,253 $333,205 $472,361
actual performance. Interest rates, 15 $329,361 $556,032 $959,419 $329,361 $556,032 $959,419
dividends, and values set forth in the 20 $367,940 $805,158 $1,779,546 $367,940 $805,158 $1,779,546
illustration are not guaranteed. 25 $286,798 $1,091,804 $3,172,140 $286,798 $1,091,804 $3,172,140
30 $0* $1,479,677 $5,442,813 $0* $1,479,677 $5,442,813
35 $0* $1,993,473 $9,037,813 $0* $1,993,473 $9,037,813
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Form No. 15-21536-01
