VC P-1
Supplement Dated July 1, 1999
to the Prospectus
of
FRANKLIN(R) VALUEMARK(R) CHARTER
a Flexible Premium Variable Annuity
Allianz Life Variable Account B
Dated May 1, 1999
1. The Board of Trustees of Franklin Valuemark Funds (the Trust), has approved a
change in the name of the Trust to Franklin Templeton Variable Insurance
Products Trust. References to Franklin Valuemark Funds or to the Trust in the
Contract's profile or prospectus should be deemed to refer to Franklin Templeton
Variable Insurance Products Trust. The names of the Portfolios of the Trust
available under the Contract remain unchanged.
2. The charts on pages 4 and 5 of the profile's section "5. Expenses" are
replaced with the following charts (to reflect a reduction in each Portfolio's
class 2 12b-1 expenses to 0.25% per year):
<TABLE>
<CAPTION>
Chart 1. EXPENSES FOR CONTRACTS WITH TRADITIONAL DEATH BENEFIT:
Total Annual EXAMPLES:
Total Annual Class 2
Insurance Portfolio Total Annual Expenses at end of:
Variable Option Charges Expenses Expenses 1 Year 10 Years
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Capital Growth ............................... 1.25% 1.02% 2.27% $23 $260
Global Health Care Securities1 ............... 1.25% 1.09% 2.34% $24 $267
Global Utilities Securities .................. 1.25% .75% 2.00% $20 $232
Growth and Income ............................ 1.25% .74% 1.99% $20 $231
High Income .................................. 1.25% .78% 2.03% $21 $235
Income Securities ............................ 1.25% .74% 1.99% $20 $231
Money Market ................................. 1.25% .78% 2.03% $21 $235
Mutual Discovery Securities .................. 1.25% 1.25% 2.50% $25 $284
Mutual Shares Securities ..................... 1.25% 1.02% 2.27% $23 $260
Natural Resources Securities ................. 1.25% .89% 2.14% $22 $247
Real Estate Securities ....................... 1.25% .79% 2.04% $21 $236
Rising Dividends ............................. 1.25% .97% 2.22% $23 $255
Small Cap .................................... 1.25% 1.02% 2.27% $23 $260
Templeton Developing Markets Equity .......... 1.25% 1.66% 2.91% $29 $324
Templeton Global Asset Allocation ............ 1.25% 1.09% 2.34% $24 $267
Templeton Global Growth ...................... 1.25% 1.13% 2.38% $24 $272
Templeton Global Income Securities ........... 1.25% .88% 2.13% $22 $246
Templeton International Equity ............... 1.25% 1.13% 2.38% $24 $272
Templeton International Smaller
Companies ................................... 1.25% 1.35% 2.60% $26 $294
Templeton Pacific Growth ..................... 1.25% 1.35% 2.60% $26 $294
U.S. Government Securities ................... 1.25% .75% 2.00% $20 $232
Value Securities1 ............................ 1.25% 1.08% 2.33% $24 $266
<FN>
1. Estimated for 1999
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Chart 2. EXPENSES FOR CONTRACTS WITH ENHANCED DEATH BENEFIT:
Total Annual EXAMPLES:
Total Annual Class 2
Insurance Portfolio Total Annual Expenses at end of:
Variable Option Charges Expenses Expenses 1 Year 10 Years
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Capital Growth ............................... 1.45% 1.02% 2.47% $25 $281
Global Health Care Securities1 ............... 1.45% 1.09% 2.54% $26 $288
Global Utilities Securities .................. 1.45% .75% 2.20% $22 $253
Growth and Income ............................ 1.45% .74% 2.19% $22 $252
High Income .................................. 1.45% .78% 2.23% $23 $256
Income Securities ............................ 1.45% .74% 2.19% $22 $252
Money Market ................................. 1.45% .78% 2.23% $23 $256
Mutual Discovery Securities .................. 1.45% 1.25% 2.70% $27 $303
Mutual Shares Securities ..................... 1.45% 1.02% 2.47% $25 $281
Natural Resources Securities ................. 1.45% .89% 2.34% $24 $267
Real Estate Securities ....................... 1.45% .79% 2.24% $23 $257
Rising Dividends ............................. 1.45% .97% 2.42% $25 $276
Small Cap .................................... 1.45% 1.02% 2.47% $25 $281
Templeton Developing Markets Equity .......... 1.45% 1.66% 3.11% $31 $343
Templeton Global Asset Allocation ............ 1.45% 1.09% 2.54% $26 $288
Templeton Global Growth ...................... 1.45% 1.13% 2.58% $26 $292
Templeton Global Income Securities ........... 1.45% .88% 2.33% $24 $266
Templeton International Equity ............... 1.45% 1.13% 2.58% $26 $292
Templeton International Smaller
Companies ................................... 1.45% 1.35% 2.80% $28 $313
Templeton Pacific Growth ..................... 1.45% 1.35% 2.80% $28 $313
U.S. Government Securities ................... 1.45% .75% 2.20% $22 $253
Value Securities1 ............................ 1.45% 1.08% 2.53% $26 $287
<FN>
1. Estimated for 1999
</FN>
</TABLE>
3.The last two sentences of the profile's section "8. Performance" are replaced
with the following language:
"Effective July 1, 1999, Class 2 shares have 12b-1
plan expenses currently equal to 0.25% per year of each portfolio's average net
assets which will affect future performance. Prior to July 1, 1999 the Class 2
shares had 12b-1 plan expenses equal to .30% per year of each portfolio's
average net assets. Past performance is not a guarantee of future results."
<PAGE>
4. The table on page 5 of the prospectus is replaced with the following table:
<TABLE>
<CAPTION>
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST'S
ANNUAL EXPENSES: CLASS 2 SHARES
(as a percentage of each Portfolio's average net assets)
The Management and Portfolio Administration Fees and Total Annual Expenses for each Portfolio are based on a percentage of that
Portfolio's average net assets for the most recent fiscal year. Class 2 shares have a distribution plan which is referred to as a
Rule 12b-1 plan. See the accompanying Franklin Templeton Variable Insurance Products Trust prospectus for a description of these
fees and the Rule 12b-1 plan. While the maximum amount payable under each Portfolio's Class 2 Rule 12b-1 plan is 0.35% per year of
the Portfolio's average daily net assets, effective July 1, 1999, the Board of Trustees of Franklin Templeton Variable Insurance
Products Trust has set the current rate at 0.25% per year. Prior to July 1, 1999 the Class 2 shares had 12b-1 plan expenses equal
to .30% per year of each portfolio's average net assets. Because Class 2 shares are new, the figures below (other than Rule 12b-1
plan fees) are based on the expenses of each Portfolio's Class 1 shares for the most recent fiscal year, except as noted.
Management
and Portfolio Total
Administration 12b-1 Other Annual
Fees1 Fees Expenses Expenses
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Growth Fund .......................................... .75% .25% .02% 1.02%
Global Health Care Securities Fund2 .......................... .75% .25% .09% 1.09%
Global Utilities Securities Fund ............................. .47% .25% .03% .75%
Growth and Income Fund ....................................... .47% .25% .02% .74%
High Income Fund ............................................. .50% .25% .03% .78%
Income Securities Fund ....................................... .47% .25% .05% .74%
Money Market Fund ............................................ .51% .25% .02% .78%
Mutual Discovery Securities Fund ............................. .95% .25% .05% 1.25%
Mutual Shares Securities Fund ................................ .74% .25% .03% 1.02%
Natural Resources Securities Fund ............................ .62% .25% .02% .89%
Real Estate Securities Fund .................................. .52% .25% .02% .79%
Rising Dividends Fund ........................................ .70% .25% .02% .97%
Small Cap Fund ............................................... .75% .25% .02% 1.02%
Templeton Developing Markets Equity Fund ..................... 1.25% .25% .16% 1.66%
Templeton Global Asset Allocation Fund ....................... .80% .25% .04% 1.09%
Templeton Global Growth Fund ................................. .83% .25% .05% 1.13%
Templeton Global Income Securities Fund ...................... .57% .25% .06% .88%
Templeton International Equity Fund .......................... .80% .25% .08% 1.13%
Templeton International Smaller Companies Fund ............... 1.00% .25% .10% 1.35%
Templeton Pacific Growth Fund ................................ .99% .25% .11% 1.35%
U.S. Government Securities Fund .............................. .48% .25% .02% .75%
Value Securities Fund2 ...................................... .75% .25% .08% 1.08%
<FN>
1.The Portfolio Administration Fee is a direct expense for the Global Health Care Securities Fund, the Mutual Discovery Securities
Fund, the Mutual Shares Securities Fund, the Templeton Global Asset Allocation Fund, the Templeton International Smaller Companies
Fund, and the Value Securities Fund; other Portfolios pay for similar services indirectly through the Management Fee. See the
accompanying Franklin Templeton Variable Insurance Products Trust prospectus for further information regarding these fees.
2. The Global Health Care Securities Fund and the Value Securities Fund commenced operations May 1, 1998. The expenses shown above
for these Portfolios are therefore estimated for 1999.
</FN>
</TABLE>
<PAGE>
5. The charts on pages 6 and 7 of the prospectus are replaced with the following
charts:
<TABLE>
<CAPTION>
CHART 1. CONTRACTS WITH TRADITIONAL DEATH BENEFIT OPTION
You would pay the following expenses on a $1,000 investment, assuming a 5% annual return on your money regardless of whether you
surrender your Contract at the end of each time period:
Variable Option 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Growth ........................................................ $23 $71 $121 $260
Global Health Care Securities* ........................................ $24 $73 $125 $267
Global Utilities Securities ........................................... $20 $63 $108 $232
Growth and Income ..................................................... $20 $62 $107 $231
High Income ........................................................... $21 $64 $109 $235
Income Securities ..................................................... $20 $62 $107 $231
Money Market .......................................................... $21 $64 $109 $235
Mutual Discovery Securities ........................................... $25 $78 $133 $284
Mutual Shares Securities .............................................. $23 $71 $121 $260
Natural Resources Securities .......................................... $22 $67 $115 $247
Real Estate Securities ................................................ $21 $64 $110 $236
Rising Dividends ...................................................... $23 $69 $119 $255
Small Cap ............................................................. $23 $71 $121 $260
Templeton Developing Markets Equity ................................... $29 $90 $153 $324
Templeton Global Asset Allocation ..................................... $24 $73 $125 $267
Templeton Global Growth ............................................... $24 $74 $127 $272
Templeton Global Income Securities .................................... $22 $67 $114 $246
Templeton International Equity ........................................ $24 $74 $127 $272
Templeton International Smaller Companies ............................. $26 $81 $138 $294
Templeton Pacific Growth .............................................. $26 $81 $138 $294
U.S. Government Securities ............................................ $20 $63 $108 $232
Value Securities* ..................................................... $24 $73 $124 $266
<FN>
*Estimated
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CHART 2. CONTRACTS WITH ENHANCED DEATH BENEFIT OPTION
You would pay the following expenses on a $1,000 investment, assuming a 5% annual return on your money regardless of whether you
surrender your Contract at the end of each time period:
Variable Option 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Growth ........................................................ $25 $77 $132 $281
Global Health Care Securities* ........................................ $26 $79 $135 $288
Global Utilities Securities ........................................... $22 $69 $118 $253
Growth and Income ..................................................... $22 $68 $117 $252
High Income ........................................................... $23 $70 $119 $256
Income Securities ..................................................... $22 $68 $117 $252
Money Market .......................................................... $23 $70 $119 $256
Mutual Discovery Securities ........................................... $27 $84 $143 $303
Mutual Shares Securities .............................................. $25 $77 $132 $281
Natural Resources Securities .......................................... $24 $73 $125 $267
Real Estate Securities ................................................ $23 $70 $120 $257
Rising Dividends ...................................................... $25 $75 $129 $276
Small Cap ............................................................. $25 $77 $132 $281
Templeton Developing Markets Equity ................................... $31 $96 $163 $343
Templeton Global Asset Allocation ..................................... $26 $79 $135 $288
Templeton Global Growth ............................................... $26 $80 $137 $292
Templeton Global Income Securities .................................... $24 $73 $124 $266
Templeton International Equity ........................................ $26 $80 $137 $292
Templeton International Smaller Companies ............................. $28 $87 $148 $313
Templeton Pacific Growth .............................................. $28 $87 $148 $313
U.S. Government Securities ............................................ $22 $69 $118 $253
Value Securities* ..................................................... $26 $79 $135 $287
<FN>
*Estimated
</FN>
</TABLE>
6. The last two sentences of paragraph two under "8. Performance" on page 17 of
the prospectus are replaced with the following language:
"Class 2 shares are relatively new and effective July 1, 1999 currently have
Rule 12b-1 Plan expenses of 0.25% per year which will affect future
performance. Prior to July 1, 1999 the Class 2 shares had 12b-1 plan expenses
of .30% per year. The information is based upon the historical experience of
the Portfolio's Class 1 shares and does not represent past performance or
predict future performance."
