SUPPLEMENT DATED DECEMBER 29, 2000 TO THE PROSPECTUS
FOR FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
DATED MAY 1, 2000
The prospectus, with respect to TEMPLETON ASSET STRATEGY FUND, is amended with
the following changes, which will become effective March 1, 2001:
I. (Page T A-1) Replace the last paragraph of the section "Main
Investments" under "Goals and Strategies" with the following: The fund's
debt investment will focus on "investment grade" securities. These are
issues rated in the top four rating categories (AAA to BBB) by independent
rating agencies such as Standard & Poor's Ratings Group (S&P(R)) or Moody's
Investors Service, Inc. (Moody's(R)) or , if unrated, determined by the
fund's manager to be comparable. The fund may also invest up to 30% of its
net assets in high yield, lower rated debt securities ("junk bonds") and
may invest up to 10% in debt securities that are in default at the time of
pur chase. These are issues that are rated B or lower , or if unrated,
determined by the fund's manager to be comparable. Many debt securities of
non-U.S. issuers, and especially emerging market issuers, are rated below
investment grade or are unrated so that their selection depends on the
manager's internal analysis. II. (Page T A-2) Replace the "Credit" section
under "Main Risks" with the following:
CREDIT An issuer may be unable to make interest payments or repay
principal. Changes in an issuer's financial strength or in a security's
credit rating may affect a security's value and, thus, impact fund
performance.
LOWER-RATED SECURITIES Junk bonds generally have more risk than
higher-rated securities, and can be considered speculative. Companies
issuing high yield debt securities are not as strong financially , and are
more likely to encounter financial difficulties and to be more vulnerable
to changes in the economy , such as a recession or a sustained period of
rising interest rates. If an issuer stops paying interest and/or principal,
payments may never resume. The fund may lose its entire investment in a
defaulted bond. The prices of high yield debt securities fluctuate more
than higher quality securities. Prices are especially sensitive to
developments affecting the company's business and to rating changes, and
typically rise and fall in response to factors that affect the company's
stock prices. In addition, the entire high yield securities market can
experience sudden and sharp price swings due to changes in economic
conditions, market activity , large sustained sales, a high-profile
default, or other factors. High yield securities generally are less liquid
than higher-quality bonds, and infrequent trades can make accurate pricing
more difficult. At times, it may be difficult to sell these securities
promptly at an acceptable price.
PLEASE KEEP THIS SUPPLEMENT FOR FUTURE REFERENCE.
TA-122900
PAGE
SUPPLEMENT DATED DECEMBER 29, 2000
TO THE PROSPECTUS FOR
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
DATED MAY 1, 2000
The prospectus, with respect to TEMPLETON GLOBAL INCOME SECURITIES FUND, is
amended by replacing the second paragraph of the section "Main Investments"
under "Goals and Strategies" (page TGI-1) with the following changes, which
will become effective March 1, 2001: The fund focuses on "investment grade"
debt securities. These are issues rated in the top four rating categories
(AAA to BBB) by independent rating agencies such as Standard & Poor's
Ratings Group (S&P(R)) or Moody's Investors Service, Inc. (Moody's(R)) or ,
if unrated, determined by the fund's manager to be comparable. The fund may
also invest up to 30% of its net assets in high yield, lower rated debt
securities ("junk bonds"), including debt from emerging markets'
governments or companies, and may invest up to 10% in debt securities that
are in default at the time of purchase. These are issues that are rated B
or lower, or if unrated, determined by the fund's manager to be
comparable.
PLEASE KEEP THIS SUPPLEMENT FOR FUTURE REFERENCE.
TGI 122900
PAGE
SUPPLEMENT DATED DECEMBER 29, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
DATED MAY 1, 2000
The Statement of Additional Information is amended as follows:
I. In the section "Goals and Strategies," in the discussion for TEMPLETON ASSET
STRATEGY FUND, the fourth paragraph, beginning "Lower rated securities" is
deleted.
II. The "Management and Other Services" section is amended by adding, following
the disclosure that Templeton Investment Counsel, Inc., serves as investment
adviser to the TEMPLETON INTERNATIONAL SECURITIES FUND, the following:
Peter A. Nori, CFA, has been a manager of the Templeton International Securities
Fund since November, 1999. He was a manager of the Templeton International
Equities Fund from 1996 until its merger and reorganization into the Templeton
International Securities Fund on May 1, 2000. Mr . Nori has been with the
Franklin Templeton Group since 1987 .
PLEASE KEEP THIS SUPPLEMENT FOR FUTURE REFERENCE.
FTVIPT SAI-122900
