<PAGE>
As filed with the Securities and Exchange Commission on December 22, 1995
File No. 33-
811-
- - ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 /X/
- - -----------------------------------------------------------------------------
ALLSTATE LIFE OF NEW YORK SEPARATE ACCOUNT A
(Exact Name of Registrant)
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
One Allstae Drive
(Name of Depositor)
Michael J. Velotta
Vice President, Secretary and General Counsel
Allstate Life Insurance Company of New York
3100 Sanders Road
Northbrook, Illinois 60062
708/402-2400
(Name and Complete Address of Agent for Service)
Copies to:
Gregor B. McCurdy, Esquire John R. Hedrick, Esquire
Routier and Johnson, P.C. Allstate Life Financial Services, Inc.
1700 K. Street N. W., Suite 1003 3100 Sanders Road
Washington, D.C. 20006 Northbrook, IL 60062
Approximate date of proposed public offering:
As soon as practicable after the effective date of the Registration Statement
---------------------------
<PAGE>
CACULATION OF REGISTRATION FEE
Title of securities Amount being Proposed Maximum Amount
Being Registered Registered Aggregate Offering of
Price Registration Fee
Flexible premium Indefinite* Indefinite* $500.00
Variable Annuity
Contracts
- - ----------------------
* Pursuant to Rule 24f-2 under the Investment Company Act of 1940, the
Registrant hereby declares it is registering an indefinite amount of securities.
The registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a)
may determine.
<PAGE>
CROSS REFERENCE SHEET
Showing Location in Part A (Prospectus) Part B (Statement of
Additional Information) and Part C as Required by Form N-4
Item of Form N-4 Prospectus Caption
- - ---------------- ------------------
Part A: INFORMATION REQUIRED IN A PROSPECTUS
1. Cover Page . . . . . . . . . . . . . . . . . . . . . . Cover Page
2. Definitions. . . . . . . . . . . . . . . . . . . . . Glossary
3. Synopsis . . . . . . . . . . . . . . . . . Highlights; Summary of Variable
Account Expenses
4. Condensed Financial. . . . . . . . . . . . . . ---
(a) Chart. . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) MM Yield . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(c) Location of Others . . . . . . . . . . . . . . .Financial Statements
5. General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) Depositor. . . . . . . . Allstate Life Insurance Company of New York
(b) Registrant . . . . . . . . . . . . . . . . . . .The Variable Account
(c) Portfolio Company. . . . . . . . . . . The Fund Series; AIM Variable
Insurance Funds, Inc.;
Investment Advisors for the Fund
(d) Fund Prospectus. . . . . . . . . . . . AIM Variable Insurance Funds;
(e) Voting Rights. . . . . . . . . . . . . . . . . . . . . Voting Rights
(f) Services . . . . . . . . . . . . . . . . .Charges & Other Deductions
Contract Maintenance Charge
6. Deductions & Expenses. . . . . . . . . . . . . .Charges & Other Deductions
(a) General. . . . . . . . . . . . . . . . . .Charges & Other Deductions
(b) Sales Load Percent . . . . . . . . . . . . . . . . Withdrawal Charge
(c) Special Purchase Plans . . . . . . . . . . . . . . . .Not Applicable
(d) Commissions. . . . . . . . . . . . . . Distribution of the Contracts
(e) Expenses -- Registrant . . . . . . . . . .Charges & Other Deductions
(f) Fund Expenses. . . . . . . . . Summary of Variable Account Expenses;
Expenses of the Funds
(g) Organizational Expenses. . . . . . . . . . . . . . . .Not Applicable
7. Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) Persons with Rights. .Benefits under the Contract; Payout Start Date
for Income Payments; Voting Rights;
Assignments; Beneficiary
(b)(i) Allocation of Purchase Payments . . Allocation of Purchase Payments
(ii) Transfers . . . . . . . . . . . . . . . .Transfers among portfolios
(iii) Exchanges . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(c) Changes . . . . . . . . . . . . . . . . . . . . . . . .Modification
(d) Inquiries . . . . . . . . . . . . . . . . . . . .Customer Inquiries
8. Annuity Period . . . . . . . . . . . Payout Start Date for Income Payments
<PAGE>
(a) Material Factors . . . . . . . . . Amount of Variable Annuity Income
Payments
(b) Dates. . . . . . . . . . . . . Payout Start Date for Income Payments
(c) Frequency, duration & level. . . . Amount of Variable Annuity Income
Payments
(d) AIR. . . . . . . . . . . . . . . . Amount of Variable Annuity Income
Payments
(e) Minimum. . . . . . . . . . . . . . Amount of Variable Annuity Income
Payments
(f) -- Change Options. . . . . . . . . . . . .Transfers among Portfolios
-- Transfer. . . . . . . . . . . . . . . . . . . . . . . . . . . ---
9. Death Benefit. . . . . . . . .Death Benefit Payable; Death Benefit Amount;
Death Benefit Payment Provisions
10. Purchases & Contract Value. . . . . . . . . . . . . . . . . . . . . . ---
(a) Purchases. . . . . . . . . . . . . . . . .Purchase of the Contracts:
Crediting of Initial Purchase Payments
(b) Valuation. . . . . . . . Accumulation Units; Accumulation Unit Value
(c) Daily Calculation. . . .Accumulation Units; Accumulation Unit Value;
Allocation of Purchase Payments
(d) Underwriter. . . . . . . . . . . . . . Distribution of the Contracts
11. Redemptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) -- By Owners . . . . . . . . . . . . . . . . . . . . . . Withdrawals
(b) -- By Annuitant. . . . . . . . . . . . . . . . . . . . .Income Plans
(c) Texas ORP. . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(d) Lapse. . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(e) Free Look. . . . . . . . . . . . . . . . . . . . . . . . .Highlights
12. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . Federal Tax Matters
13. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . .Not Applicable
14. SAI Table of Contents. . . . . . . . . . . . . . . . SAI Table of Contents
Part B: INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION
15. Cover Page . . . . . . . . . . . . . . . . . . . . . . . . . . .Cover Page
16. Table of Contents. . . . . . . . . . . . . . . . . . . . Table of Contents
17. General Information & History. . . . . . . . . . . . . . . . . . . . . ---
(a) Depositor's Name . . . . Allstate Life Insurance Company of New York
(b) Assets of Sub-account. . . . . . . . . . . . . .The Variable Account
(c) Control of Depositor . . Allstate Life Insurance Company of New York
18. Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) Fees & Expenses of Registrant. . . . . . Contract Maintenance Charge
(b) Management Contracts . . . . . . . . . .Contract Maintenance Charge;
Distribution of the Contracts
(c) Custodian. . . . . . . . . . . . . SAI: Safekeeping of the Variable
Account's Assets
<PAGE>
Independent Public Accountant. . . . . . . . . . . . . . . . Experts
(d) Assets of Registrant . . . . . . . SAI: Safekeeping of the Variable
Account Assets
(e) Affiliated Persons . . . . . . . . . . . . . . . . . .Not Applicable
(f) Principal Underwriter. . . . . . . . . Distribution of the Contracts
19. Purchase of Securities Being Offered . . . . . . . . . . . . . . . . . ---
(a) Offering . . . . . . . . . . . . . . . . SAI: Purchase of Contracts
(b) Sales load . . . . . . . . . . . . . . Distribution of the Contracts
20. Underwriters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) Principal Underwriter. . . . . . .Distribution of the Contracts
(b) Continuous offering. . . . . . . . . . . SAI: Purchase of Contracts
(c) Commissions. . . . . . . . . . . . . . Distribution of the Contracts
(d) Unaffiliated Underwriters. . . . . . . . . . . . . . . . . . . . N/A
21. Calculation of Performance Data. . . . . . . . . . .SAI: Performance Data
22. Annuity Payments . . . . . . . . . . . . . . . . . . . . . Income Payments
23. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . ---
(a) Financial Statements of Registrant . . . . . . . .SAI: Not Applicable
(b) Financial Statements of Depositor. . . . . . . Allstate Life Insurance
Company of New York Financial Statements
Part C: OTHER INFORMATION
24a. Financial Statements . . . . . . . . . . .Part C. Financial Statements
24b. Exhibits . . . . . . . . . . . . . . . . . . . . . . .Part C. Exhibits
25. Directors and Officers . . . . . . . . Part C. Directors & Officers of
Depositor
26. Persons Controlled By or Under Common
Control with Depositor or Registrant . . Part C. Persons Controlled by
or Under Common Control
with Depositor or
Registrant
27. Number of Contract Owners. . . . . . Part C. Number of Contract Owners
28. Indemnification. . . . . . . . . . . . . . . . Part C. Indemnification
29a. Relationship of Principal Underwriter to
Other Investment Companies . . . . . Part C. Relationship of Principal
Underwriter to Other
Investment Companies
29b. Principal Underwriters . . . . . . . . .Part C. Principal Underwriters
29c. Compensation of Underwriter. . . Part C. Compensation of Allstate Life
Financial Services, Inc.
30. Location of Accounts and Records . . .Part C. Location of Accounts and
<PAGE>
Records
31. Management Services. . . . . . . . . . . . Part C. Management Services
31. Undertakings . . . . . . . . . . . . . . . . . . . Part C. Undertakings
<PAGE>
ALLSTATE LIFE OF NEW YORK SEPARATE ACCOUNT A
OFFERED BY
ALLSTATE LIFE INSURANCE COMPANY
OF NEW YORK
POST OFFICE BOX 9095
FARMINGVILLE, NEW YORK 11738
1-(800)
FLEXIBLE PREMIUM DEFERRED VARIABLE
ANNUITY CONTRACTS
------------------------
This prospectus describes the AIM Lifetime Plus-SM- Variable Annuity, a
group Flexible Premium Deferred Variable Annuity Certificate (hereinafter
referred to as "Contract") designed to aid you in long-term financial planning
and which can be used for retirement planning. The Contracts are issued by
Allstate Life Insurance Company of New York ("Company"), a wholly owned indirect
subsidiary of Allstate Insurance Company. Purchase payments for the Contracts
will be allocated to a series of Variable Sub-accounts of the Allstate Life of
New York Separate Account A ("Variable Account") and/or to a Fixed Account
option(s) funded through the Company's general account.
The Variable Sub-accounts invest in shares of AIM Variable Insurance Funds,
Inc. (the "Fund Series"). Nine Funds are currently available for investment
within the Variable Account: (1) AIM V.I. Capital Appreciation Fund; (2) AIM
V.I. Diversified Income Fund; (3) AIM V.I. Global Utilities Fund; (4) AIM V.I.
Government Securities Fund; (5) AIM V.I. Growth Fund; (6) AIM V.I. Growth and
Income Fund; (7) AIM V.I. International Equity Fund; (8) AIM V.I. Money Market
Fund; and (9) AIM V.I. Value Fund.
This prospectus presents information you should know before making a
decision to invest in the Contract and the available Investment Alternatives.
THE CONTRACTS MAY BE DISTRIBUTED THROUGH BROKER-DEALERS WHICH HAVE
RELATIONSHIPS WITH BANKS OR OTHER FINANCIAL INSTITUTIONS OR BY EMPLOYEES OF SUCH
BANKS; HOWEVER, THE CONTRACTS AND THE INVESTMENTS IN THE FUNDS ARE NOT DEPOSITS,
OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY ANY BANK, AND THE FUNDS' SHARES
ARE NOT FEDERALLY INSURED OR GUARANTEED BY THE U.S. GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY.
INVESTMENT IN THE CONTRACTS INVOLVES INVESTMENT RISKS, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. THESE CONTRACTS ARE NOT FDIC INSURED
The Company has prepared and filed a Statement of Additional Information
dated , 1996 with the U.S. Securities and Exchange Commission. If you
wish to receive the Statement of Additional Information, you may obtain a free
copy by calling or writing the Company at the address above. For your
convenience, an order form for the Statement of Additional Information may be
found on page B-2 of this prospectus. Before ordering, you may wish to review
the Table of Contents of the Statement of Additional Information on page B-1 of
this prospectus. The Statement of Additional Information has been incorporated
by reference into this prospectus.
THIS PROSPECTUS IS VALID ONLY WHEN ACCOMPANIED OR PRECEDED BY A CURRENT
PROSPECTUS FOR AIM VARIABLE INSURANCE FUNDS, INC.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PLEASE READ THIS PROSPECTUS CAREFULLY AND RETAIN IT FOR FUTURE REFERENCE
The Contract is only available in the State of New York.
At least once each Contract year, the Company will send the Owner an annual
statement that contains certain information pertinent to the individual Owner's
Contract. The annual statement details values and specific Contract data that
applies to each particular Contract. The annual statement does not contain
financial statements of the Company. The Company, however, is subject to the
informational requirements of the Securities Exchange Act of 1934 and in
accordance therewith files reports and other information with the Securities and
Exchange Commission. Reports and other information filed by the Company can be
inspected at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. Copies of such material can be
obtained from the Public Reference Section of the Commission, Washington, D.C.
20549 at prescribed rates.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO DEALER, SALESMAN, OR OTHER PERSON IS
AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS IN CONNECTION
WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN
OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON.
THE DATE OF THIS PROSPECTUS IS , 1996.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
GLOSSARY.......................................... 3
HIGHLIGHTS........................................ 4
SUMMARY OF VARIABLE ACCOUNT EXPENSES.............. 5
CONDENSED FINANCIAL INFORMATION................... 6
YIELD AND TOTAL RETURN DISCLOSURE................. 6
FINANCIAL STATEMENTS.............................. 7
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK AND
THE VARIABLE ACCOUNT............................. 7
Allstate Life Insurance Company of New York..... 7
The Variable Account............................ 7
THE FUND SERIES................................... 8
AIM Variable Insurance Funds, Inc............... 8
Investment Advisor for the Funds................ 8
FIXED ACCOUNT..................................... 9
Example of Interest Crediting During the
Guarantee Period............................... 9
Withdrawals or Transfers........................ 10
Market Value Adjustment......................... 10
PURCHASE OF THE CONTRACTS......................... 10
Purchase Payment Limits......................... 10
Free-Look Period................................ 11
Crediting of Initial Purchase Payment........... 11
Allocation of Purchase Payments................. 11
Accumulation Units.............................. 11
Accumulation Unit Value......................... 11
Transfers Among Investment Alternatives......... 11
Dollar Cost Averaging........................... 12
Automatic Fund Rebalancing...................... 12
BENEFITS UNDER THE CONTRACT....................... 12
Withdrawals..................................... 12
Income Payments................................. 12
Payout Start Date for Income Payments......... 12
Variable Account Income Payments.............. 13
Fixed Amount Income Payments.................. 13
Income Plans.................................. 13
DEATH BENEFITS.................................... 14
Distribution Upon Death Payment Provisions...... 14
Death Benefit Amount............................ 14
CHARGES AND OTHER DEDUCTIONS...................... 14
Deductions from Purchase Payments............... 14
Withdrawal Charge (Contingent Deferred Sales
Charge)........................................ 15
Contract Maintenance Charge..................... 15
Administrative Expense Charge................... 15
<CAPTION>
PAGE
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<S> <C>
Mortality and Expense Risk Charge............... 16
Taxes........................................... 16
Transfer Charges................................ 16
Fund Expenses................................... 16
GENERAL MATTERS................................... 16
Owner........................................... 16
Beneficiary..................................... 16
Assignments..................................... 16
Delay of Payments............................... 17
Modification.................................... 17
Customer Inquiries.............................. 17
FEDERAL TAX MATTERS............................... 17
Introduction.................................... 17
Taxation of Annuities in General................ 17
Tax Deferral.................................. 17
Non-natural Owners............................ 17
Diversification Requirements.................. 17
Ownership Treatment........................... 17
Taxation of Partial and Full Withdrawals...... 18
Taxation of Annuity Payments.................. 18
Taxation of Annuity Death Benefits............ 18
Penalty Tax on Premature Distributions........ 18
Aggregation of Annuity Contracts.............. 19
Tax Qualified Contracts....................... 19
Restrictions Under Section 403(b) Plans....... 19
Income Tax Withholding........................ 19
DISTRIBUTION OF THE CONTRACTS..................... 19
VOTING RIGHTS..................................... 19
SELECTED FINANCIAL DATA........................... 20
COMPETITION....................................... 20
EMPLOYEES......................................... 20
PROPERTIES........................................ 20
STATE AND FEDERAL REGULATION...................... 20
EXECUTIVE OFFICERS AND DIRECTORS OF THE COMPANY... 21
EXECUTIVE COMPENSATION............................ 22
LEGAL PROCEEDINGS................................. 23
EXPERTS........................................... 23
LEGAL MATTERS..................................... 23
FINANCIAL STATEMENTS.............................. F-1
APPENDIX A - Market Value Adjustment.............. A-1
STATEMENT OF ADDITIONAL INFORMATION: TABLE OF
CONTENTS......................................... B-1
ORDER FORM........................................ B-2
</TABLE>
2
<PAGE>
GLOSSARY
ACCUMULATION UNIT: A measure of your ownership interest in a Sub-account of
the Variable Account prior to the Payout Start Date. Analogous, though not
identical, to a share owned in a mutual fund.
ACCUMULATION UNIT VALUE: The value of each Accumulation Unit which is
calculated each Valuation Date. Each Sub-account of the Variable Account has its
own distinct Accumulation Unit Value. Analogous, though not identical, to the
share price (net asset value) of a mutual fund.
ANNUITANT(S): The person or persons whose life determines the latest Payout
Start Date and the amount and duration of any income payments for Income Plan
options other than Guaranteed Payments for a Specified Period. Joint annuitants
are only permitted in the payout phase.
BENEFICIARY(IES): The person(s) to whom any benefits are due when a death
benefit is payable and there is no surviving Owner.
COMPANY("WE," "US"): Allstate Life Insurance Company of New York.
CONTRACT: The Allstate Life Insurance Company of New York Flexible Premium
Deferred Variable Annuity Contract, known as the "AIM Lifetime Plus-SM- Variable
Annuity," that is described in this prospectus.
CONTRACT ANNIVERSARY: An anniversary of the date that the Contract was
issued.
CONTRACT VALUE: The value of all amounts accumulated under the Contract
prior to the Payout Start Date, equivalent to the Accumulation Units in each
Sub-account of the Variable Account multiplied by the respective Accumulation
Unit Value, plus the value in the Fixed Account.
CONTRACT YEAR: A period of 12 months starting with the issue date or any
Contract Anniversary.
DEATH BENEFIT ANNIVERSARY: Every seventh Contract Anniversary beginning on
the date that the Contract was issued. For example, the issue date, 7th and 14th
Contract Anniversaries are the first three Death Benefit Anniversaries.
FIXED ACCOUNT: All of the assets of the Company that are not in separate
accounts.
FIXED SUB-ACCOUNTS: These Sub-accounts are distinguished by Guarantee
Period(s) and the dates the period(s) begin. The Fixed Sub-accounts are
established when purchase payments are allocated to the Fixed Account; when
previous Sub-accounts expire and a new Guarantee Period is selected; and when
You transfer an amount to the Fixed Account.
GUARANTEE PERIOD: A period of years for which a specified effective annual
interest rate is guaranteed by the Company.
INCOME PLAN: One of several ways in which a series of payments are made
after the Payout Start Date. Income payments are based on the Contract Value
adjusted by any applicable Market Value Adjustment and applicable taxes on the
Payout Start Date. Income payment amounts may vary based on any Sub-account of
the Variable Account and/or may be fixed for the duration of the Income Plan.
INVESTMENT ALTERNATIVES: The Sub-accounts of the Variable Account and the
Fixed Account.
MARKET VALUE ADJUSTMENT: The Market Value Adjustment is the adjustment made
to the money distributed from a Sub-account of the Fixed Account, prior to the
end of the Guarantee Period, to reflect the impact of changes in interest rates
between the time the Sub-account of the Fixed Account was established and the
time of distribution.
NON-QUALIFIED CONTRACTS: Contracts other than Qualified Contracts.
OWNER(S)("YOU"): The person or persons designated as the Owner in the
Contract.
PAYOUT START DATE: The date on which income payments begin.
QUALIFIED CONTRACTS: Contracts issued under plans that qualify for special
federal income tax treatment under Sections 401(a), 403(a), 403(b) and 408 of
the Internal Revenue Code.
VALUATION DATE: Each day that the New York Stock Exchange is open for
business. The Valuation Date does not include such Federal and non-Federal
holidays as are observed by the New York Stock Exchange.
VALUATION PERIOD: The period between successive Valuation Dates, commencing
at the close of regular trading on the New York Stock Exchange (which is
normally 4:00pm Eastern Time) and ending as of the close of regular trading on
the New York Stock Exchange on the next succeeding Valuation Date.
VARIABLE ACCOUNT: Allstate Life of New York Separate Account A, a separate
investment account established by the Company to receive and invest purchase
payments paid under the Contracts.
VARIABLE SUB-ACCOUNT: A portion of the Variable Account invested in shares
of a corresponding Fund. The investment performance of each Variable Sub-account
is linked directly to the investment performance of its corresponding Fund.
3
<PAGE>
HIGHLIGHTS
THE CONTRACT
This Contract is designed for long-term financial planning and retirement
planning. Money can be allocated to any combination of Funds or the Fixed
Account. You have access to your funds either through withdrawals of Contract
Value or through periodic income payments. You bear the entire investment risk
for Contract Values and income payments based upon the Variable Account, because
values will vary depending on the investment performance of the Fund(s) you
select. See "Accumulation Unit Value," page 11 and "Income Plans," page 13. You
will also bear the investment risk of adverse changes in interest rates in the
event amounts are prematurely withdrawn or transferred from Sub-accounts of the
Fixed Account. See "Fixed Account," page 9.
FREE-LOOK
You may cancel the Contract any time within 10 days after receipt of the
Contract and receive a full refund of purchase payments allocated to the Fixed
Account. Purchase payments allocated to the Variable Account will be returned
after an adjustment to reflect investment gain or loss that occurred from the
date of allocation through the date of cancellation, unless a refund of purchase
payments is required by state or federal law. See "Free-Look Period," page 11.
HOW TO INVEST
Your first purchase payment must be at least $5,000 (for qualified
contracts, $2,000). Subsequent purchase payments must be at least $500. Purchase
payments may also be made pursuant to an Automatic Addition Program. See
"Purchase Payment Limits," page 10. At the time of your application, you will
allocate your purchase payment among the Investment Alternatives. The allocation
you specify on the application will be effective immediately. All allocations
must be in whole percents from 0% to 100% (total allocation equals 100%) or in
whole dollars. Allocations may be changed by notifying the Company in writing.
See "Allocation of Purchase Payments," page 11.
INVESTMENT ALTERNATIVES
The Variable Account invests in shares of AIM Variable Insurance Funds, Inc.
(the "Fund Series"). The Fund Series has a total of nine Funds available under
the Contract. The Funds include: (1) AIM V.I. Capital Appreciation Fund; (2) AIM
V.I. Diversified Income Fund; (3) AIM V.I. Global Utilities Fund; (4) AIM V.I.
Government Securities Fund; (5) AIM V.I. Growth Fund; (6) AIM V.I. Growth and
Income Fund; (7) AIM V.I. International Equity Fund; (8) AIM V.I. Money Market
Fund; and (9) AIM V.I. Value Fund. The assets of each Fund are held separately
from the other Funds and each has distinct investment objectives and policies
which are described in the accompanying prospectus for the Fund Series. In
addition to the Variable Account, Owners can also allocate all or part of their
purchase payments to the Fixed Account. See "Fixed Account," on page 9.
TRANSFERS AMONG INVESTMENT ALTERNATIVES
Prior to the Payout Start Date, you may transfer amounts among the
Investment Alternatives. The Company reserves the right to assess a $10 charge
on each transfer in excess of twelve per Contract Year. The Company is presently
waiving this charge. Transfers to the Fixed Account must be at least $500.
Certain Fixed Account transfers may be restricted. See "Transfers Among
Investment Alternatives," page 11. You may want to enroll in a Dollar Cost
Averaging Program or an Automatic Fund Rebalancing Program. See "Dollar Cost
Averaging," page 12, and "Automatic Fund Rebalancing," page 12.
CHARGES AND DEDUCTIONS
The costs of the Contract include: a contract maintenance charge ($35
annually), a mortality and expense risk charge (deducted daily, equal on an
annual basis to 1.35% of the Contract's daily net assets of the Variable
Account), and an administrative expense charge (deducted daily, equal on an
annual basis to .10% of the Contract's daily net assets of the Variable
Account). The Company reserves the right to assess a transfer charge ($10 on
each transfer in excess of twelve per Contract Year). Additional deductions may
be made for certain taxes. See "Contract Maintenance Charge," page 16,
"Mortality and Expense Risk Charge," page 16, "Administrative Expense Charge,"
page 16, "Transfer Charges," page 16, and "Taxes," page 16.
WITHDRAWALS
You may withdraw all or part of the Contract Value before the earliest of
the Payout Start Date, the death of any Owner or, if the Owner is not a natural
person, the death of the Annuitant. No withdrawal charges or Market Value
Adjustments will be applied to amounts withdrawn up to 10% of the amount of
purchase payments. Amounts withdrawn in excess of the 10% may be subject to a
withdrawal charge of 0% to 6% depending on how long purchase payments have been
invested in the Contract. Amounts withdrawn from a Sub-account of the Fixed
Account, in excess of the 10%, except during the 30 day period after the
Guarantee Period expires, will be subject to a Market Value Adjustment. See
"Withdrawals," page 12, "Withdrawals or Transfers," page 10, and "Taxation of
Annuities in General," page 18.
DEATH BENEFIT
The Company will pay a death benefit prior to the Payout Start Date on the
death of any Owner or, if the Owner is not a natural person, the death of the
Annuitant. See "Death Benefit Amount," page 14.
4
<PAGE>
INCOME PAYMENTS
You will receive periodic income payments beginning on the Payout Start
Date. You may choose among several Income Plans to fit your needs. Income
payments may be received for a specified period or for life (either single or
joint life), with or without a guaranteed number of payments. You can select
income payments that are fixed, variable or a combination of fixed and variable.
See "Income Payments," page 13.
SUMMARY OF VARIABLE ACCOUNT EXPENSES
The following table illustrates all expenses and fees that you will incur.
The expenses and fees set forth in the table are based on charges under the
Contracts and on the expenses of the Variable Account and the underlying Fund
Series.
OWNER TRANSACTION EXPENSES (ALL SUB-ACCOUNTS)
<TABLE>
<S> <C>
Sales Load Imposed on Purchases (as a percentage of purchase payments).................... None
Contingent Deferred Sales Charge (as a percentage of purchase payments)................... *
</TABLE>
<TABLE>
<CAPTION>
APPLICABLE SALES
NUMBER OF COMPLETE YEARS SINCE PURCHASE CHARGE AS A
PAYMENT BEING WITHDRAWN WAS MADE PERCENTAGE
- - ------------------------------------------------------------------------------------------- -----------------
<S> <C>
0 years................................................................................ 6%
1 year................................................................................. 6%
2 years................................................................................ 5%
3 years................................................................................ 5%
4 years................................................................................ 4%
5 years................................................................................ 4%
6 years................................................................................ 3%
7 Years or more........................................................................ 0%
Transfer Fee............................................................................... **
Annual Contract Fee........................................................................ $35***
Variable Account Annual Expenses (as a percentage of the Contract's average net assets in the Variable
Account)
Mortality and Expense Risk Charge.......................................................... 1.35%
Administrative Expense Charge.............................................................. 10%
Total Variable Account Annual Expenses..................................................... 1.45%
</TABLE>
- - ------------
* Each Contract Year up to 10% of the amount of purchase payments may be
withdrawn without a contingent deferred sales charge or a Market Value
Adjustment.
** No charges will be imposed on the first twelve transfers in any Contract
Year. The Company reserves the right to assess a $10 charge for each
transfer in excess of twelve in any Contract Year, excluding transfers due
to dollar cost averaging and automatic fund rebalancing.
*** The annual Contract Fee will be waived if total purchase payments as of a
Contract Anniversary, or upon a full withdrawal, are $50,000 or if the
entire Contract Value is allocated to the Fixed Account.
FUND EXPENSES
(AS A PERCENTAGE OF FUND ASSETS)
<TABLE>
<CAPTION>
TOTAL FUND
MANAGEMENT OTHER ANNUAL
FUND FEES EXPENSES EXPENSES
- - ------------------------------------------------------------------------------- ------------ ------------ -------------
<S> <C> <C> <C>
AIM V.I. Capital Appreciation Fund............................................. 0.65% 0.19% 0.84%
AIM V.I. Growth and Income Fund(1)............................................. 0.65% 0.41% 1.06%
AIM V.I. Global Utilities Fund(1).............................................. 0.00%(2) 1.50%(3) 1.50%
AIM V.I. Diversified Income Fund............................................... 0.60% 0.43% 1.03%
AIM V.I. Government Securities Fund............................................ 0.50% 0.60% 1.10%
AIM V.I. Growth Fund........................................................... 0.65% 0.30% 0.95%
AIM V.I. International Equity Fund............................................. 0.75% 0.53% 1.28%
AIM V.I. Value Fund............................................................ 0.65% 0.17% 0.82%
AIM V.I. Money Market Fund..................................................... 0.40% 0.30% 0.70%
</TABLE>
- - ------------
(1) The fees and expenses set forth are based on estimated amounts for the
current fiscal year.
5
<PAGE>
(2) The management fees listed are reduced because the Investment Advisor for
the Funds, AIM Advisors, Inc. is temporarily waiving the imposition of
certain management fees. If this waiver were not in effect, the management
fees for the AIM V.I. Global Utilities Fund, as a percentage of each Fund's
average net assets would be 0.65%.
(3) "Other Expenses" listed for the AIM V.I. Global Utilities Fund include
expense reimburesments. Had there been no expense reimbursements, other
expenses would have been 1.65%.
EXAMPLE
You (the Owner) would pay the following cumulative expenses on a $1,000
investment, assuming a 5% annual return under the following circumstances:
If you terminate your Contract or annuitize for a specified period of less
than 120 months at the end of the applicable time period:
<TABLE>
<CAPTION>
FUND 1 YEAR 3 YEARS
- - ------------------------------------------------------------------------------------------------------- ----------- -----------
<S> <C> <C>
AIM V.I. Capital Appreciation Fund..................................................................... $ 79 $ 121
AIM V.I. Growth and Income Fund........................................................................ $ 81 $ 127
AIM V.I. Global Utilities Fund......................................................................... $ 85 $ 141
AIM V.I. Diversified Income Fund....................................................................... $ 81 $ 127
AIM V.I. Government Securities Fund.................................................................... $ 81 $ 129
AIM V.I. Growth Fund................................................................................... $ 80 $ 124
AIM V.I. International Equity Fund..................................................................... $ 83 $ 134
AIM V.I. Value Fund.................................................................................... $ 78 $ 120
AIM V.I. Money Market Fund............................................................................. $ 77 $ 116
</TABLE>
If you do not terminate your Contract or if you annuitize for a specified
period of 120 months or more at the end of the applicable time period:
<TABLE>
<CAPTION>
FUND 1 YEAR 3 YEARS
- - ------------------------------------------------------------------------------------------------------- ----------- -----------
<S> <C> <C>
AIM V.I. Capital Appreciation Fund..................................................................... $ 25 $ 76
AIM V.I. Growth and Income Fund........................................................................ $ 27 $ 82
AIM V.I. Global Utilities Fund......................................................................... $ 31 $ 96
AIM V.I. Diversified Income Fund....................................................................... $ 27 $ 82
AIM V.I. Government Securities Fund.................................................................... $ 27 $ 84
AIM V.I. Growth Fund................................................................................... $ 26 $ 79
AIM V.I. International Equity Fund..................................................................... $ 29 $ 89
AIM V.I. Value Fund.................................................................................... $ 24 $ 75
AIM V.I. Money Market Fund............................................................................. $ 23 $ 71
</TABLE>
THE ABOVE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSE. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. The
purpose of the example is to assist you in understanding the various costs and
expenses that you will bear directly or indirectly. Premium taxes, which vary
from 0 - 3.5% depending on the state where the Contract is sold, are not
reflected in the example. Currently, no deductions are made because New York
does not charge premium taxes on annuities.
CONDENSED FINANCIAL INFORMATION
Condensed financial information for the Allstate Life of New York Separate
Account A is not included because, as of the date of this prospectus, the
Variable Account had not yet commenced operations and had no assets,
liabilities, or income.
YIELD AND TOTAL RETURN DISCLOSURE
From time to time the Variable Account may advertise the yield and total
return investment performance of one or more Sub-accounts. Standardized yield
and total return advertisements include charges and expenses attributable to the
Contracts. Including these fees has the effect of decreasing the advertised
performance of a Sub-account, so that a Sub-account's investment performance
will not be directly comparable to that of an ordinary mutual fund.
When a Sub-account advertises its standardized total return it will usually
be calculated for one year, five years, and ten years or since inception if the
Sub-account has not been in existence for such periods. Total return is measured
by comparing the value of an investment in the Sub-account at the end of the
relevant period to the value of the investment at the beginning of the period.
6
<PAGE>
In addition to the standardized total return, the Sub-account may advertise
a non-standardized total return. This figure will usually be calculated for one
year, five years, and ten years or other periods. Non-standardized total return
is measured in the same manner as the standardized total return described above,
except that the withdrawal charges under the Contract are not deducted.
Therefore, a non-standardized total return for a Sub-account can be higher than
a standardized total return for a Sub-account.
Certain Sub-accounts may advertise yield in addition to total return. Except
in the case of the AIM V.I. Money Market Sub-account, the yield will be computed
in the following manner: the net investment income per unit earned during a
recent one month period is divided by the unit value on the last day of the
period, and then annualized. This figure reflects the recurring charges at the
separate account level.
The AIM V.I. Money Market Sub-account may advertise, in addition to the
total return, either yield or the effective yield. The yield in this case refers
to the income generated by an investment in that Sub-account over a seven-day
period net of recurring charges at the separate account level. The income is
then annualized (i.e., the amount of income generated by the investment during
that week is assumed to be generated each week over a 52-week period and is
shown as a percentage of the investment). The effective yield is calculated
similarly but when annualized, the income earned by an investment in the AIM
V.I. Money Market Sub-account is assumed to be reinvested at the end of each
seven-day period. The effective yield will be slightly higher than the yield
because of the compounding effect of this assumed reinvestment during a 52-week
period.
The Variable Account may also disclose yield, standard total return, and
non-standard total return for periods prior to the date that the Variable
Account commenced operations. For periods prior to the date the Variable Account
commenced operations, performance information for the Sub-accounts will be
calculated based on the performance of the underlying Funds and the assumption
that the Sub-accounts were in existence for the same periods as those of the
underlying Funds, with a level of charges equal to those currently assessed
against the Sub-accounts.
Please refer to the Statement of Additional Information for a further
description of the method used to calculate a Sub-account's yield and total
return.
FINANCIAL STATEMENTS
The financial statements of Allstate Life Insurance Company of New York are
on page F-1 of the prospectus. The financial statements of Allstate Life of New
York Separate Account A are not included because, as of the date of this
Prospectus, the Variable Account had not yet commenced operations and had no
assets, liabilities, or income.
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK AND THE VARIABLE ACCOUNT
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
The Company was incorporated in 1967 as a stock life insurance company under
the laws of New York and was known as "Financial Life Insurance Company" from
1967 to 1978. From 1978 to 1984, the Company was known as "PM LIfe Insurance
Company." Since 1984 the Company has been known as "Allstate Life Insurance
Company of New York." The Company's operations consist of one business segment
which is the sale of annuities and life insurance. The Company is currently
licensed to operate in New York. The Company's home office is located in
Farmingville, New York.
The Company is an indirect, wholly-owned subsidiary of Allstate Insurance
Company ("Allstate") which is a stock property-liability insurance company
incorporated under the laws of Illinois. With the exception of directors'
qualifying shares, all of the outstanding capital stock of Allstate is owned by
The Allstate Corporation ("Corporation").
THE VARIABLE ACCOUNT
Established on , 1995, the Allstate Life of New York Separate Account
A is a unit investment trust registered with the Securities and Exchange
Commission under the Investment Company Act of 1940. However, such registration
does not signify that the Commission supervises the management or investment
practices or policies of the Variable Account. The investment performance of the
Variable Account is entirely independent of both the investment performance of
the Company's general account and the performance of any other separate account.
The Variable Account has been divided into nine Sub-accounts, each of which
invests solely in its corresponding Fund of AIM Variable Insurance Funds, Inc.
Additional Variable Sub-accounts may be added at the discretion of the Company.
The assets of the Variable Account are held separately from the other assets
of the Company. They are not chargeable with liabilities incurred in the
Company's other business operations. Accordingly, the income, capital gains and
capital losses, realized or unrealized, incurred on the assets of the Variable
Account are credited to or charged against the assets of the Variable Account,
without regard to the income, capital gains or capital losses arising out of any
other business the Company may conduct. The Company's obligations arising under
the Contracts are general corporate obligations of the Company.
7
<PAGE>
THE FUND SERIES
The Variable Account will invest in shares of the AIM Variable Insurance
Funds, Inc. (the "Fund Series"). The Fund Series is registered with the
Securities and Exchange Commission as an open-end, series, management investment
company. Registration of the Fund Series does not involve supervision of its
management, investment practices or policies by the Securities and Exchange
Commission. The Funds are designed to provide investment vehicles for variable
insurance contracts of various insurance companies, in addition to the Variable
Account.
Shares of the Funds are not deposits, or obligations of, or guaranteed or
endorsed by any bank and the shares are not federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board or any other agency.
AIM VARIABLE INSURANCE FUNDS, INC.
AIM Variable Insurance Funds, Inc. offers nine Funds for use with this
Contract: (1) AIM V.I Capital Appreciation Fund; (2) AIM V.I Diversified Income
Fund; (3) AIM V.I. Global Utilities Fund; (4) AIM V.I. Government Securities
Fund; (5) AIM V.I. Growth Fund; (6) AIM V.I. Growth and Income Fund; (7) AIM
V.I. International Equity Fund; (8) AIM V.I. Money Market Fund; and (9) AIM V.I.
Value Fund. Each Fund has different investment objectives and policies and
operates as a separate investment fund. The following is a brief description of
the investment objectives and programs of the Funds:
AIM V.I. CAPITAL APPRECIATION FUND ("CAPITAL APPRECIATION FUND") is a
diversified Fund which seeks to provide capital appreciation through investments
in common stocks, with emphasis on medium-sized and smaller emerging growth
companies.
AIM V.I. DIVERSIFIED INCOME FUND ("DIVERSIFIED INCOME FUND") is a
diversified Fund which seeks to achieve a high level of current income primarily
by investing in a diversified portfolio of foreign and U.S. government and
corporate debt securities, including lower rated high yield debt securities
(commonly known as "junk bonds").
AIM V.I. GLOBAL UTILITIES FUND ("GLOBAL UTILITIES FUND") is a
non-diversified Fund which seeks to achieve a high level of current income and,
as a secondary objective, to achieve capital appreciation, by investing
primarily in common and preferred stocks of public utility companies (either
domestic or foreign).
AIM V.I. GOVERNMENT SECURITIES FUND ("GOVERNMENT FUND") is a diversified
Fund which seeks to achieve a high level of current income consistent with
reasonable concern for safety of principal by investing in debt securities
issued, guaranteed or otherwise backed by the U.S. Government.
AIM V.I. GROWTH FUND ("GROWTH FUND") is a diversified Fund which seeks to
provide growth of capital through investments primarily in common stocks of
leading U.S. companies considered by AIM to have strong earnings momentum.
AIM V.I. GROWTH AND INCOME FUND ("GROWTH & INCOME FUND") is a diversified
Fund which seeks to provide growth of capital, with current income as a
secondary objective by investing primarily in dividend paying common stocks
which have prospects for both growth of capital and dividend income.
AIM V.I. INTERNATIONAL EQUITY FUND ("INTERNATIONAL FUND") is a diversified
Fund which seeks to provide long-term growth of capital by investing in
international equity securities, the issuers of which are considered by AIM to
have strong earnings momentum.
AIM V.I. MONEY MARKET FUND ("MONEY MARKET FUND") is a diversified Fund which
seeks to provide as high a level of current income as is consistent with the
preservation of capital and liquidity by investing in a diversified portfolio of
money market instruments.
AIM V.I. VALUE FUND ("VALUE FUND") is a diversified Fund which seeks to
achieve long-term growth of capital by investing primarily in equity securities
judged by AIM to be undervalued relative to the current or projected earnings of
the companies issuing the securities, or relative to current market values of
assets owned by the companies issuing the securities or relative to the equity
markets generally. Income is a secondary objective.
INVESTMENT ADVISOR FOR THE FUNDS
AIM Advisors, Inc., ("AIM") serves as the investment advisor to each Fund.
AIM was organized in 1976 and, together with its affiliates, manages or advises
38 investment company portfolios (including the Funds). AIM is a wholly owned
subsidiary of AIM Management Group Inc., a holding company. AIM manages pursuant
to a master investment advisory agreement dated October 18, 1993, as amended
April 28, 1994. As of November 15, 1995, total assets advised or managed by AIM
and its affiliates were approximately $40 billion.
There is no assurance that the Funds will attain their respective stated
objectives. Additional information concerning the investment objectives and
policies of the Funds can be found in the current prospectus for the Fund Series
accompanying this prospectus.
You will find more complete information about the Funds, including the risks
associated with each Fund, in the accompanying prospectus. You should read the
prospectus for the Fund Series in conjunction with this prospectus.
8
<PAGE>
THE FUND SERIES PROSPECTUS SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS
MADE CONCERNING THE ALLOCATION OF PURCHASE PAYMENTS TO A PARTICULAR VARIABLE
SUB-ACCOUNT.
FIXED ACCOUNT
Purchase payments and transfers allocated to one or more of the Sub-accounts
of the Fixed Account become part of the general account of the Company. Each
Sub-account offers a separate interest rate Guarantee Period. Guarantee Periods
will be offered at the Company's discretion and may range from one to ten years.
Presently, the Company offers Guarantee Periods of one, three, five, seven and
ten years. The Owner must select the Sub-account(s) in which to allocate each
purchase payment and transfer. No less than $500 may be allocated to any one
Sub-account. The Company reserves the right to limit the number of additional
purchase payments. Please consult with your sales representative for current
information.
Interest is credited daily to each Sub-account at a rate which compounds to
the effective annual interest rate declared for each Sub-account's Guarantee
Period that has been selected.
The following example illustrates how the Sub-account value for a
Sub-account of the Fixed Account would grow given an assumed purchase payment,
Guarantee Period, and effective annual interest rate:
EXAMPLE OF INTEREST CREDITING DURING THE GUARANTEE PERIOD:
<TABLE>
<S> <C>
Purchase Payment:..................................................................... $10,000.00
Guarantee Period:..................................................................... 5 years
Effective Annual Rate:................................................................ 4.35%
</TABLE>
END OF CONTRACT YEAR:
<TABLE>
<CAPTION>
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Beginning Sub-Account Value $10,000.00
X (1 + Effective Annual Rate) 1.0435
----------
$10,435.00
Sub-Account Value at end of Contract $10,435.00
year 1 X (1 + Effective Annual Rate) 1.0435
----------
$10,888.92
Sub-Account Value at end of Contract $10,888.92
year 2 X (1 + Effective Annual Rate) 1.0435
----------
$11,362.59
Sub-Account Value at end of Contract $11,362.59
year 3 X (1 + Effective Annual Rate) 1.0435
----------
$11,856.86
Sub-Account Value at end of Contract $11,856.86
year 4 X (1 + Effective Annual Rate) 1.0435
----------
Sub-Account Value at end of Guarantee Period: $12,372.64
----------
----------
TOTAL INTEREST CREDITED IN GUARANTEE PERIOD: $2,372.64 ($12,372.64 -$10,000.00)
</TABLE>
NOTE: The above illustration assumes no withdrawals of any amount during the
entire five year period. A withdrawal charge and a Market Value
Adjustment may apply to any amount withdrawn in excess of 10% of the
amount of purchase payments. The hypothetical interest rate is for
illustrative purposes only and is not intended to predict future interest
rates to be declared under the Contract.
The Company has no specific formula for determining the rate of interest
that it will declare initially or in the future. Such interest rates will be
reflective of investment returns available at the time of the determination. In
addition, the management of the Company may also consider various other factors
in determining interest rates, including regulatory and tax requirements, sales
commissions and administrative expenses borne by the Company, general economic
trends, and competitive factors. The Company guarantees that the interest rates
will never be less that the minimum guaranteed rate shown in the Contract. For
current interest rate information, please contact your sales representative or
the Company's customer support unit at 1(800)
THE MANAGEMENT OF THE COMPANY WILL MAKE THE FINAL DETERMINATION AS TO THE
INTEREST RATES TO BE DECLARED. THE COMPANY CAN NEITHER PREDICT NOR GUARANTEE
FUTURE INTEREST RATES TO BE DECLARED.
9
<PAGE>
Prior to the end of a Guarantee Period, a notice will be mailed to the Owner
outlining the options available at the end of a Guarantee Period. During the 30
day period after a Guarantee Period expires the Owner may:
- take no action and the Company will automatically renew the Sub-account
value to a Guarantee Period of the same duration to be established on the
day the previous Guaranteed Period expired; or
- notify the Company to apply the Sub-account value to a new Guarantee
Period or periods to be established on the day the previous Guarantee
Period expired; or
- notify the Company to apply the Sub-account value to any Sub-account of
the Variable Account on the day we receive the notification; or
- receive a portion of the Sub-account value or the entire Sub-account value
through a partial or full withdrawal that is not subject to a Market Value
Adjustment. In this case, the amount withdrawn will be deemed to have been
withdrawn on the day the guarantee period expired.
The Automatic Laddering Program allows the Owner to choose, in advance, one
renewal Guarantee Period for all renewing Sub-accounts. The Owner can select the
Automatic Laddering Program at any time during the accumulation phase, including
on the issue date. The Automatic Laddering Program will continue until the Owner
gives written notice to the Company. The Company reserves the right to
discontinue this Program. For additional information on the Automatic Laddering
Program, please call the Company's Customer Support Unit at 1(800) .
WITHDRAWALS OR TRANSFERS
With the exception of transfers made automatically through dollar cost
averaging, all withdrawals and transfers, paid from a Sub-account of the Fixed
Account other than during the 30 day period after a Guarantee Period expires are
subject to a Market Value Adjustment.
The amount received by the Owner under a withdrawal request equals the
amount requested, less any applicable withdrawal charge (based upon the amount
requested prior to any Market Value Adjustment), adjusted by any Market Value
Adjustment, less premium taxes and withholding (if applicable).
MARKET VALUE ADJUSTMENT
The Market Value Adjustment reflects the relationship between (1) the
Treasury Rate for the time remaining in the Guarantee Period at the time of the
request for withdrawal or transfer, and (2) the Treasury Rate at the time the
Sub-account was established. As such, the Owner bears some investment risk under
the Contract. Treasury Rate means the U.S. Treasury Note Constant Maturity yield
for the preceding week as reported in Federal Reserve Bulletin Release H.15.
Generally, if the Treasury Rate for the Guarantee Period is higher than the
applicable current Treasury Rate, then the Market Value Adjustment will result
in a higher amount payable to the Owner or transferred. Similarly, if the
Treasury Rate at the time the Sub-account was established is lower than the
applicable Treasury Rate (interest rate for a period equal to the time remaining
in the Sub-account), then the Market Value Adjustment will result in a lower
amount payable to the Owner or transferred.
For example, assume the Owner purchases a Contract and selects an initial
Guarantee Period of five years and the five year Treasury Rate for that duration
is 4.75%. Assume that at the end of 3 years, the Owner makes a partial
withdrawal. If, at that later time, the current two year Treasury Rate is 4.00%,
then the Market Value Adjustment will be positive, which will result in an
increase in the amount payable to the Owner. Similarly, if the current two year
Treasury Rate is 7.00%, then the Market Value Adjustment will be negative, which
will result in a decrease in the amount payable to the Owner.
The formula for calculating the Market Value Adjustment is set forth in
Appendix A to this prospectus which also contains additional illustrations of
the application of the Market Value Adjustment.
PURCHASE OF THE CONTRACTS
PURCHASE PAYMENT LIMITS
Your first purchase payment must be at least $5,000 unless the Contract is a
Qualified Contract, in which case the first purchase payment must be at least
$2,000. All subsequent purchase payments must be $500 or more and may be made at
any time prior to the Payout Start Date. Subsequent purchase payments may also
be made from your bank account through Automatic Additions. Under an Automatic
Additions Program, the minimum purchase payment for allocation to the Variable
Account is $100 and for allocation to the Fixed Account the minimum purchase
payment is $500. Please consult with your sales representative for detailed
information about Automatic Additions.
We reserve the right to limit the amount of purchase payments we will
accept.
10
<PAGE>
FREE-LOOK PERIOD
You may cancel the Contract any time within 10 days after receipt of the
Contract and receive a full refund of purchase payments allocated to the Fixed
Account. Purchase payments allocated to the Variable Account will be returned
after an adjustment to reflect investment gain or loss that occurred from the
date of allocation through the date of cancellation unless a refund of purchase
payments is required by state or federal law.
CREDITING OF INITIAL PURCHASE PAYMENT
The initial purchase payment accompanied by a duly completed application
will be credited to the Contract within two business days of receipt by us at
our home office. If an application is not duly completed, we will credit the
purchase payments to the Contract within five business days or return it at that
time unless you specifically consent to us holding the purchase payment until
the application is complete. We reserve the right to reject any application.
Subsequent purchase payments will be credited to the Contract at the close of
the Valuation Period in which the purchase payment is received by the Company at
its home office.
ALLOCATION OF PURCHASE PAYMENTS
On the application, you instruct us how to allocate the purchase payment
among the Investment Alternatives. Purchase payments may be allocated in whole
percents, from 0% to 100% (total allocation equals 100%) to any Investment
Alternative. Unless you notify us in writing otherwise, subsequent purchase
payments are allocated according to the allocation for the previous purchase
payment.
ACCUMULATION UNITS
Each purchase payment allocated to the Variable Account will be credited to
the Contract as Accumulation Units. For example, if a $10,000 purchase payment
is credited to the Contract when the Accumulation Unit value equals $10, then
1,000 Accumulation Units would be credited to the Contract. The Variable
Account, in turn, purchases shares of the corresponding Fund.
ACCUMULATION UNIT VALUE
The Accumulation Units in each Sub-account of the Variable Account are
valued separately. The value of Accumulation Units will change each Valuation
Period according to the investment performance of the shares purchased by each
Variable Sub-account and the deduction of certain expenses and charges.
The value of an Accumulation Unit in a Variable Sub-account for any
Valuation Period equals the value of the Accumulation Unit as of the immediately
preceding Valuation Period, multiplied by the Net Investment Factor for that
Sub-account for the current Valuation Period. The Net Investment Factor for a
Valuation Period is a number representing the change, since the last Valuation
Date in the value of Sub-account assets per Accumulation Unit due to investment
income, realized or unrealized capital gain or loss, deductions for taxes, if
any, and deductions for the mortality and expense risk charge and administrative
expense charge.
TRANSFERS AMONG INVESTMENT ALTERNATIVES
Prior to the Payout Start Date, you may transfer amounts among Investment
Alternatives. The Company reserves the right to assess a $10 charge on each
transfer in excess of twelve per Contract Year. The Company is presently waiving
this charge. Transfers to or from more than one Investment Alternative on the
same day are treated as one transfer. Transfers among Investment Alternatives
before the Payout Start Date may be made at any time. See "Withdrawals or
Transfers," page 10 for the requirements on transfers from the Fixed Account.
After the Payout Start Date, transfers among Sub-accounts of the Variable
Account or from a variable amount income payment to a fixed amount income
payment may be made only once every six months and may not be made during the
first six months following the Payout Start Date. After the Payout Start Date,
transfers from a fixed amount income payment are not allowed.
Telephone transfer requests will be accepted by the Company if received at
1(800) by 4:00 p.m., Eastern Time. Telephone transfer requests received at
any other telephone number or after 4:00 p.m., Eastern Time will not be accepted
by the Company. Telephone transfer requests received before 4:00 p.m., Eastern
Time are effected at the next computed value. The Company utilizes procedures
which the Company believes will provide reasonable assurance that telephone
authorized transfers are genuine. Such procedures include taping of telephone
conversations with persons purporting to authorize such transfers and requesting
identifying information from such persons. Accordingly, the Company disclaims
any liability for losses resulting from such transfers by reason of their
allegedly not having been properly authorized. However, if the Company does not
take reasonable steps to help ensure that such authorizations are valid, the
Company may be liable for such losses.
The minimum amount that may be transferred into a Sub-account of the Fixed
Account is $500. Any transfer from a Sub-account of the Fixed Account at a time
other than during the 30 day period after a Guarantee Period expires will be
subject to a Market Value Adjustment. If any transfer reduces the value of a
Sub-account of the Fixed Account to less than $500, the Company will treat the
request as a transfer of the entire Sub-account value.
The Company reserves the right to waive transfer restrictions.
11
<PAGE>
DOLLAR COST AVERAGING
Transfers may be made automatically through Dollar Cost Averaging prior to
the Payout Start Date. Dollar Cost Averaging permits the Owner to transfer a
specified amount every month from the one year Guarantee Period Sub-account of
the Fixed Account, to any Sub-account of the Variable Account. Transfers made
through Dollar Cost Averaging must be $50 or more. Dollar Cost Averaging cannot
be used to transfer amounts to the Fixed Account. Transfers made through Dollar
Cost Averaging are not subject to a Market Value Adjustment. In addition, such
transfers are not assessed a $10 charge and are not included in the twelve free
transfers per Contract Year.
The theory of Dollar Cost Averaging is that, if purchases of equal dollar
amounts are made at fluctuating prices, the aggregate average cost per unit will
be less than the average of the unit prices on the same purchase dates. However,
participation in the Dollar Cost Averaging program does not assure you of a
greater profit from your purchases under the program; nor will it prevent or
alleviate losses in a declining market.
AUTOMATIC FUND REBALANCING
Transfers may be made automatically through Automatic Fund Rebalancing prior
to the Payout Start Date. By electing Automatic Fund Rebalancing, all of the
money allocated to Sub-accounts of the Variable Account will be rebalanced to
the desired allocation on a quarterly basis, determined from the first date that
you decide to rebalance. Each quarter, money will be transferred among
Sub-accounts of the Variable Account to achieve the desired allocation.
The desired allocation will be the allocation initially selected, unless
subsequently changed. You may change the allocation at any time by giving us
written notice. The new allocation will be effective with the first rebalancing
that occurs after we receive the written request. We are not responsible for
rebalancing that occurs prior to receipt of the written request.
Transfers made through Automatic Fund Rebalancing are not assessed a $10
charge and are not included in the twelve free transfers per Contract Year.
Any money allocated to the Fixed Account will not be included in the
rebalancing.
BENEFITS UNDER THE CONTRACT
WITHDRAWALS
You may withdraw all or part of the Contract Value at any time prior to the
earlier of the death of the Owner (or the Annuitant if the Owner is not a
natural person) or the Payout Start Date. The amount available for withdrawal is
the Contract Value next computed after the Company receives the request for a
withdrawal at its home office, adjusted by any applicable Market Value
Adjustment, less any withdrawal charges, contract maintenance charges and any
premium taxes. Withdrawals from the Variable Account will be paid within seven
days of receipt of the request, subject to postponement in certain
circumstances. See "Delay of Payments," page 17.
Money can be withdrawn from the Variable Account or the Fixed Account. To
complete the partial withdrawal from the Variable Account, the Company will
redeem Accumulation Units in an amount equal to the withdrawal and any
applicable withdrawal charge and premium taxes. The Owner must name the
Investment Alternative from which the withdrawal is to be made. If none is
named, then the withdrawal request is incomplete and cannot be honored.
The minimum partial withdrawal is $50. If any withdrawal reduces the value
of any Sub-account of the Fixed Account to less than $500, we will treat the
request as a withdrawal of the entire Sub-account value. If the Contract Value
after a partial withdrawal would be less than $1,000, then the Company will
treat the request as one for termination of the Contract and the entire Contract
Value, adjusted by any Market Value Adjustment, less any charges and premium
taxes, will be paid out.
Partial withdrawals may also be taken automatically through Systematic
Withdrawals on a monthly, quarterly, semi-annual or annual basis. Systematic
Withdrawals of $50 or more may be requested at any time prior to the Payout
Start Date. At the Company's discretion, Systematic Withdrawals may not be
offered in conjunction with Dollar Cost Averaging or Automatic Fund Rebalancing.
Partial and full withdrawals may be subject to income tax and a 10% tax
penalty. This tax and penalty are explained in "Federal Tax Matters," on page
17.
After the Payout Start Date, withdrawals are only permitted when payments
from the Variable Account are being made that do not involve life contingencies.
In that case, you may terminate the Variable Account portion of the income
payments at any time and receive a lump sum equal to the commuted balance of the
remaining variable payments due, less any applicable withdrawal charge.
INCOME PAYMENTS
PAYOUT START DATE FOR INCOME PAYMENTS
The Payout Start Date is the day that income payments will start under the
Contract. You may change the Payout Start Date at any time by notifying the
Company in writing of the change at least 30 days before the scheduled Payout
Start Date. The Payout Start Date must be (a) at least one month after the issue
date; and (b) no later than the day the Annuitant reaches age 85.
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VARIABLE ACCOUNT INCOME PAYMENTS
The amount of Variable Account income payments depends upon the investment
experience of the Sub-accounts selected by the Owner and any premium taxes, the
age and sex of the Annuitant, and the Income Plan chosen. The Company guarantees
that the amount of the income payment will not be affected by (1) actual
mortality experience and (2) the amount of the Company's administration
expenses.
The Contracts offered by this prospectus contain income payment tables that
provide for different benefit payments to men and women of the same age.
Nevertheless, in accordance with the U.S. Supreme Court's decision in ARIZONA
GOVERNING COMMITTEE V. NORRIS, in certain employment-related situations, annuity
tables that do not vary on the basis of sex will be used.
The total income payments received may be more or less than the total
purchase payments made because (a) Variable Account income payments vary with
the investment results of the underlying Funds, and (b) Annuitants may not live
as long as, or may live longer than, expected.
The Income Plan option selected will affect the dollar amount of each income
payment. For example, if an Income Plan for a Life Income is chosen, the income
payments will be greater than income payments under an Income Plan for a Life
Income with Guaranteed Payments.
If the actual net investment experience of the Variable Account is less than
the assumed investment rate, then the dollar amount of the income payments will
decrease. The dollar amount of the income payments will stay level if the net
investment experience equals the assumed investment rate and the dollar amount
of the income payments will increase if the net investment experience exceeds
the assumed investment rate. For purposes of the Variable Account income
payments, the assumed investment rate is 3 percent. For more detailed
information as to how Variable Account income payments are determined see the
Statement of Additional Information.
FIXED AMOUNT INCOME PAYMENTS
Income payment amounts derived from any monies allocated to Sub-accounts of
the Fixed Account during the accumulation phase are fixed for the duration of
the Income Plan. The fixed amount income payment amount is calculated by
applying the portion of the Contract Value in the Fixed Account on the Payout
Start Date, adjusted by any Market Value Adjustment and less any applicable
premium tax, to the greater of the appropriate value from the income payment
table selected or such other value as we are offering at that time.
INCOME PLANS
The Income Plans include:
INCOME PLAN 1 -- LIFE INCOME WITH GUARANTEED PAYMENTS
The Company will make payments for as long as the Annuitant lives. If the
Annuitant dies before the selected number of guaranteed payments have been made,
the Company will continue to pay the remainder of the guaranteed payments.
INCOME PLAN 2 -- JOINT AND SURVIVOR LIFE INCOME WITH GUARANTEED PAYMENTS
The Company will make payments for as long as either the Annuitant or Joint
Annuitant, named at the time of Income Plan selection, is living. If both the
Annuitant and the Joint Annuitant die before the selected number of guaranteed
payments have been made, the Company will continue to pay the remainder of the
guaranteed payments.
INCOME PLAN 3 -- GUARANTEED NUMBER OF PAYMENTS
The Company will make payments for a specified number of months beginning on
the Payout Start Date. These payments do not depend on the Annuitant's life. The
number of months guaranteed may be from 60 to 360. The mortality and expense
risk charge will be deducted from Variable Account assets supporting these
payments even though the Company does not bear any mortality risk.
The Owner may change the Income Plan until 30 days before the Payout Start
Date. If an Income Plan is chosen which depends on the Annuitant or Joint
Annuitant's life, proof of age will be required before income payments begin.
Applicable premium taxes will be assessed.
In the event that an Income Plan is not selected, the Company will make
income payments in accordance with Income Plan 1 with Guaranteed Payments for
120 Months. At the Company's discretion, other Income Plans may be available
upon request. The Company currently uses sex-distinct annuity tables. However,
if legislation is passed by Congress or the State of New York, the Company
reserves the right to use income payment tables which do not distinguish on the
basis of sex. Special rules and limitations may apply to certain qualified
contracts.
If the Contract Value to be applied to an Income Plan is less than $2,000,
or if the monthly payments determined under the Income Plan are less than $20,
the Company may pay the Contract Value adjusted by any Market Value Adjustment
and less any applicable taxes, in a lump sum or change the payment frequency to
an interval which results in income payments of at least $20.
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DEATH BENEFITS
DISTRIBUTION UPON DEATH PAYMENT PROVISIONS
A distribution upon death may be paid to the Owner determined immediately
after the death if, prior to the Payout Start Date:
- any Owner dies; or
- the Annuitant dies and the Owner is not a natural person.
If the Owner eligible to receive a distribution upon death is not a natural
person, then the Owner may elect to receive the distribution upon death in one
or more distributions. Otherwise, if the Owner is a natural person, the Owner
may elect to receive a distribution upon death in one or more distributions or
periodic payments through an Income Plan.
A death benefit will be paid: 1) if the Owner elects to receive the death
benefit in a single payment distributed within 180 days of the date of death;
and 2) if the death benefit is paid as of the day the value of the death benefit
is determined. Otherwise, the settlement value will be paid. The settlement
value is the same amount that would be paid in the event of withdrawal of the
Contract Value. The Company will calculate the settlement value at the end of
the Valuation Period coinciding with the requested distribution date for payment
or on the mandatory distribution date of 5 years after the date of death. In any
event, the entire distribution upon death must be distributed within five years
after the date of death unless an Income Plan is selected or a surviving spouse
continues the Contract in accordance with the following sections:
Payments from the Income Plan must begin within one year of the date of
death and must be payable throughout:
- the life of the Owner; or
- a period not to exceed the life expectancy of the Owner; or
- the life of the Owner with payments guaranteed for a period not to exceed
the life expectancy of the Owner.
If the surviving spouse of the deceased Owner is the new Owner, then the
spouse may elect one of the options listed above or may continue the Contract in
the accumulation phase as if the death had not occurred. The Company will only
permit the Contract to be continued once. If the Contract is continued in the
accumulation phase, the surviving spouse may make a single withdrawal of any
amount within one year of the date of death without incurring a withdrawal
charge. However, any applicable Market Value Adjustment, determined as of the
date of the withdrawal, will apply.
DEATH BENEFIT AMOUNT
Prior to the Payout Start Date, the death benefit is equal to the greatest
of:
(a) the Contract Value on the date the Company determines the death
benefit; or
(b) the amount that would have been payable in the event of a full
withdrawal of the Contract Value on the date the Company determines the
death benefit; or
(c) the Contract Value on the Death Benefit Anniversary immediately
preceding the date we determine the death benefit adjusted by any
purchase payments, withdrawals and charges made between such Death
Benefit Anniversary and the date we determine the death benefit.
(d) the greatest of the anniversary values as of the date we determine the
death benefit. The anniversary value is equal to the Contract Value on
a Contract Anniversary, increased by purchase payments made since that
anniversary and reduced by the amount of any partial withdrawals since
that anniversary. Anniversary values will be calculated for each
Contract Anniversary prior to the earlier of: (i) the date we determine
the death benefit, or (ii) the deceased's attained age 75 or 5 years
after the date the Contract was established, if later.
The value of the death benefit will be determined at the end of the
Valuation Period during which the Company receives a complete request for
payment of the death benefit, which includes due proof of death.
The Company will not settle any death claim until it receives due proof of
death.
CHARGES AND OTHER DEDUCTIONS
DEDUCTIONS FROM PURCHASE PAYMENTS
No deductions are made from purchase payments. Therefore, the full amount of
every purchase payment is invested in the Investment Alternative(s).
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WITHDRAWAL CHARGE (CONTINGENT DEFERRED SALES CHARGE)
You may withdraw the Contract Value at any time before the earliest of the
Payout Start Date, the death of any Owner or, if the Owner is not a natural
person, the death of the Annuitant.
There are no withdrawal charges on amounts withdrawn up to 10% of the amount
of purchase payments. Amounts withdrawn in excess of this may be subject to a
withdrawal charge. Amounts not subject to a withdrawal charge and not withdrawn
in a Contract Year are not carried over to later Contract Years. Withdrawal
charges, if applicable, will be deducted from the amount paid.
For purposes of calculating the amount of the withdrawal charge, withdrawals
are assumed to come from purchase payments first, beginning with the oldest
payment. Withdrawals made after all purchase payments have been withdrawn, will
not be subject to a withdrawal charge. For partial withdrawals, the Contract
Value will be adjusted to reflect the amount of payment received by the Owner,
any withdrawal charge, any applicable taxes and any Market Value Adjustment.
Withdrawals in excess of the preferred withdrawal amount will be subject to
a withdrawal charge as set forth below:
<TABLE>
<CAPTION>
COMPLETE YEARS SINCE
PURCHASE PAYMENT BEING APPLICABLE WITHDRAWAL
WITHDRAWN WAS MADE CHARGE PERCENTAGE
- - ------------------------------------------------------------------------------------------- ---------------------
<S> <C>
0 YEARS.................................................................................... 6%
1 YEAR..................................................................................... 6%
2 YEARS.................................................................................... 5%
3 YEARS.................................................................................... 5%
4 YEARS.................................................................................... 4%
5 YEARS.................................................................................... 4%
6 YEARS.................................................................................... 3%
7 YEARS OR MORE............................................................................ 0%
</TABLE>
Withdrawal charges will be used to pay sales commissions and other
promotional or distribution expenses associated with the marketing of the
Contracts. The Company does not anticipate that the withdrawal charges will
cover all distribution expenses in connection with the Contract.
In addition, federal and state income tax may be withheld from withdrawal
amounts. Certain terminations may also be subject to a federal tax penalty. See
"Federal Tax Matters," page 17.
The Company reserves the right to waive the withdrawal charge with respect
to Contracts issued to employees and registered representatives of any
broker-dealer that has entered into a sales agreement with Allstate Life
Financial Services, Inc. ("ALFS") to sell the Contracts and all wholesalers and
their employees that are under agreement with ALFS to wholesale the Contract. In
addition, the Company will waive any withdrawal charge prior to the Payout Start
Date if at least 30 days after the Contract Date any Owner (or Annuitant if the
Owner is not a natural person) is first confined to a long term care facility or
hospital for at least 90 consecutive days, confinement is prescribed by a
physician and is medically necessary, and the request for a withdrawal and
adequate written proof of confinement are received by us no later than 90 days
after discharge. The withdrawal charge will also be waived on withdrawals taken
to satisfy IRS required minimum distribution rules for this Contract.
CONTRACT MAINTENANCE CHARGE
A contract maintenance charge is deducted annually from the Contract Value
to reimburse the Company for its actual costs in maintaining each Contract and
the Variable Account. The Company guarantees that the amount of this charge will
not exceed $35 per Contract Year over the life of the Contract. This charge will
be waived if the total purchase payments are $50,000 or more on a Contract
Anniversary or if all money is allocated to the Fixed Account on the Contract
Anniversary.
Maintenance costs include but are not limited to expenses incurred in
billing and collecting purchase payments; keeping records; processing death
claims, cash withdrawals, and policy changes; proxy statements; calculating
Accumulation Unit and Annuity Unit values; and issuing reports to Owners and
regulatory agencies. The Company does not expect to realize a profit from this
charge.
On each Contract Anniversary prior to the payout start date, the contract
maintenance charge will be deducted from Sub-accounts of the Variable Account in
the same proportion that the Owner's value in each bears to the total value in
all Sub-accounts of the Variable Account. After the Payout Start Date, a pro
rata share of the annual contract maintenance charge will be deducted from each
income payment. For example, 1/12 of the $35, or $2.92, will be deducted if
there are twelve income payments during the Contract Year. A full contract
maintenance charge will be deducted if the Contract is terminated on any date
other than a Contract Anniversary.
ADMINISTRATIVE EXPENSE CHARGE
The Company will deduct an administrative expense charge which is equal, on
an annual basis, to .10% of the daily net assets you have allocated to the
Sub-accounts of the Variable Account. This charge is designed to cover actual
administrative expenses which exceed the
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revenues from the contract maintenance charge. The Company does not intend to
profit from this charge. The Company believes that the administrative expense
charge and contract maintenance charge have been set at a level that will
recover no more than the actual costs associated with administering the
Contracts. There is no necessary relationship between the amount of
administrative charge imposed on a given Contract and the amount of expenses
that may be attributable to that Contract.
MORTALITY AND EXPENSE RISK CHARGE
The Company will deduct a mortality and expense risk charge which is equal,
on an annual basis, to 1.35% of the daily net assets you have allocated to the
Sub-accounts of the Variable Account. The Company estimates that .95% is
attributable to the assumption of mortality risks and .40% is attributable to
the assumption of expense risks. The Company guarantees that the amount of this
charge will not increase over the life of the Contract.
The mortality risk arises from the Company's guarantee to cover all death
benefits and to make income payments in accordance with the Income Plan selected
and the Income Payment Tables.
The expense risk arises from the possibility that the contract maintenance
and administrative expense charge, both of which are guaranteed not to increase,
will be insufficient to cover actual administrative expenses.
If the mortality and expense risk charge is insufficient to cover the
Company's mortality costs and excess expenses, the Company will bear the loss.
If the charge is more than sufficient, the Company will retain the balance as
profit. The Company currently expects a profit from this charge. Any such
profit, as well as any other profit realized by the Company and held in its
general account (which supports insurance and annuity obligations), would be
available for any proper corporate purpose, including, but not limited to,
payment of distribution expenses.
TAXES
The Company will deduct applicable state premium taxes or other similar
policyholder taxes relative to the Contract (collectively referred to as
"premium taxes") either at the Payout Start Date, or when a total withdrawal
occurs. The Company reserves the right to deduct premium taxes from the purchase
payments. Currently, no deductions are made because New York does not charge
premium taxes on annuities.
At the Payout Start Date, the charge for applicable premium taxes will be
deducted from each Investment Alternative in the proportion that the Owner's
value in the Investment Alternative bears to the total Contract Value.
TRANSFER CHARGES
The Company reserves the right to assess a $10 charge on each transfer in
excess of twelve per Contract Year, excluding transfers through Dollar Cost
Averaging and Automatic Fund Rebalancing. The Company is presently waiving this
charge.
FUND EXPENSES
A complete description of the expenses and deductions from the Funds is
found in the prospectus for the Fund Series. This prospectus is accompanied by
the prospectus for the Fund Series.
GENERAL MATTERS
OWNER
The Owner has the sole right to exercise all rights and privileges under the
Contract, except as otherwise provided in the Contract. The Contract cannot be
jointly owned by both a non-natural person and a natural person.
BENEFICIARY
Subject to the terms of any irrevocable Beneficiary designation, the Owner
may change the Beneficiary at any time by notifying the Company in writing. Any
change will be effective at the time it is signed by the Owner, whether or not
the Annuitant is living when the change is received by the Company. The Company
will not, however, be liable as to any payment or settlement made prior to
receiving the written notice.
Unless otherwise provided in the Beneficiary designation, if a Beneficiary
predeceases the Owner and there are no other surviving beneficiaries, the new
Beneficiary will be: the Owner's spouse if living; otherwise, the Owner's
children, equally, if living; otherwise, the Owner's estate. Multiple
Beneficiaries may be named. Unless otherwise provided in the Beneficiary
designation, if more than one Beneficiary survives the Owner, the surviving
Beneficiaries will share equally in any amounts due.
ASSIGNMENTS
The Company will not honor an assignment of an interest in a Contract as
collateral or security for a loan. Otherwise, the Owner may assign benefits
under the Contract prior to the Payout Start Date. No Beneficiary may assign
benefits under the Contract until they are due.
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No assignment will bind the Company unless it is signed by the Owner and filed
with the Company. The Company is not responsible for the validity of an
assignment. Federal law prohibits or restricts the assignment of benefits under
many types of retirement plans and the terms of such plans may themselves
contain restrictions on assignments.
DELAY OF PAYMENTS
Payment of any amounts due from the Variable Account under the Contract will
occur within seven days, unless:
1. The New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on the Exchange is otherwise restricted;
2. An emergency exists as defined by the Securities and Exchange
Commission; or
3. The Securities and Exchange Commission permits delay for the protection
of the Owners.
Payments or transfers from the Fixed Account may be delayed for up to 6
months.
MODIFICATION
The Company may not modify the Contract without the consent of the Owner
except to make the Contract meet the requirements of the Investment Company Act
of 1940, or to make the Contract comply with any changes in the Internal Revenue
Code or to make any changes required by the Code or by any other applicable law.
CUSTOMER INQUIRIES
The Owner or any persons interested in the Contract may make inquiries
regarding the Contract by calling or writing your representative or the Company
at:
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
POST OFFICE BOX 9095
FARMINGVILLE, NEW YORK 11738
1-(800)
FEDERAL TAX MATTERS
INTRODUCTION
THE FOLLOWING DISCUSSION IS GENERAL AND IS NOT INTENDED AS TAX ADVICE. THE
COMPANY MAKES NO GUARANTEE REGARDING THE TAX TREATMENT OF ANY CONTRACT OR
TRANSACTION INVOLVING A CONTRACT. Federal, state, local and other tax
consequences of ownership or receipt of distributions under an annuity contract
depend on the individual circumstances of each person. If you are concerned
about any tax consequences with regard to your individual circumstances, you
should consult a competent tax adviser.
TAXATION OF ANNUITIES IN GENERAL
TAX DEFERRAL
Generally, an annuity contract owner is not taxed on increases in the
Contract Value until a distribution occurs. This rule applies only where (1) the
owner is a natural person, (2) the investments of the Variable Account are
"adequately diversified" in accordance with Treasury Department Regulations, and
(3) the issuing insurance company, instead of the annuity owner, is considered
the owner for federal income tax purposes of any separate account assets funding
the contract.
NON-NATURAL OWNERS
As a general rule, annuity contracts owned by non-natural persons such as
corporations, trusts, or other entities are not treated as annuity contracts for
federal income tax purposes and the income on such contracts is taxed as
ordinary income received or accrued by the owner during the taxable year. There
are several exceptions to the general rule for contracts owned by non-natural
persons which are discussed in the Statement of Additional Information.
DIVERSIFICATION REQUIREMENTS
For a Contract to be treated as an annuity for federal income tax purposes,
the investments in the Variable Account must be "adequately diversified" in
accordance with the standards provided in the Treasury regulations. If the
investments in the Variable Account are not adequately diversified, then the
Contract will not be treated as an annuity contract for federal income tax
purposes and the Owner will be taxed on the excess of the Contract Value over
the investment in the Contract. Although the Company does not have control over
the Funds or their investments, the Company expects the Funds to meet the
diversification requirements.
OWNERSHIP TREATMENT
In connection with the issuance of the regulations on the adequate
diversification standards, the Department of the Treasury announced that the
regulations do not provide guidance concerning the extent to which contract
owners may direct their investments among
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Sub-accounts of a variable account. The Internal Revenue Service has previously
stated in published rulings that a variable contract owner will be considered
the owner of separate account assets if the owner possesses incidents of
ownership in those assets such as the ability to exercise investment control
over the assets. At the time the diversification regulations were issued,
Treasury announced that guidance would be issued in the future regarding the
extent that owners could direct their investments among Sub-accounts without
being treated as owners of the underlying assets of the Variable Account. As of
the date of this prospectus, no such guidance has been issued.
The ownership rights under this contract are similar to, but different in
certain respects from, those described by the Service in rulings in which it was
determined that contract owners were not owners of separate account assets. For
example, the owner of this contract has the choice of more investment options to
which to allocate premiums and contract values, and may be able to transfer
among investment options more frequently than in such rulings. These differences
could result in the contract owner being treated as the owner of the assets of
the Variable Account. In those circumstances, income and gains from the Variable
Account assets would be includible in the Contract Owners' gross income. In
addition, the Company does not know what standards will be set forth in the
regulations or rulings which the Treasury Department has stated it expects to
issue. It is possible that Treasury's position, when announced, may adversely
affect the tax treatment of existing contracts. The Company, therefore, reserves
the right to modify the Contract as necessary to attempt to prevent the Owner
from being considered the federal tax owner of the assets of the Variable
Account. However, the Company makes no guarantee that such modification to the
contract will be successful.
TAXATION OF PARTIAL AND FULL WITHDRAWALS
In the case of a partial withdrawal under a non-qualified contract, amounts
received are taxable to the extent the contract value before the withdrawal
exceeds the investment in the contract. The investment in the contract is the
gross premium or other consideration paid for the contract reduced by any
amounts previously received from the contract to the extent such amounts were
properly excluded from the owner's gross income. In the case of a partial
withdrawal under a qualified contract, the portion of the payment that bears the
same ratio to the total payment that the investment in the contract (i.e.,
nondeductible IRA contributions, after tax contributions to qualified plans)
bears to the contract value, can be excluded from income. In the case of a full
withdrawal under a non-qualified contract or a qualified contract, the amount
received will be taxable only to the extent it exceeds the investment in the
contract. If an individual transfers an annuity contract without full and
adequate consideration to a person other than the individual's spouse (or to a
former spouse incident to a divorce), the owner will be taxed on the difference
between the contract value and the investment in the contract at the time of
transfer. Other than in the case of certain qualified contracts, any amount
received as a loan under a contract, and any assignment or pledge (or agreement
to assign or pledge) of the contract value is treated as a withdrawal of such
amount or portion. The contract provides a death benefit that in certain
circumstances may exceed the greater of the payments and the contract value. As
described elsewhere in the prospectus, the Company imposes certain charges with
respect to the death benefit. It is possible that some portion of those charges
could be treated for federal tax purposes as a partial withdrawal from the
contract.
TAXATION OF ANNUITY PAYMENTS
Generally, the rule for income taxation of payments received from an annuity
contract provides for the return of the owner's investment in the contract in
equal tax-free amounts over the payment period. The balance of each payment
received is taxable. In the case of variable annuity payments, the amount
excluded from taxable income is determined by dividing the investment in the
contract by the total number of expected payments. In the case of fixed annuity
payments, the amount excluded from income is determined by multiplying the
payment by the ratio of the investment in the contract (adjusted for any refund
feature or period certain) to the total expected value of annuity payments for
the term of the contract. Once the total amount of the investment in the
contract is excluded using these ratios, the annuity payments will be fully
taxable. If annuity payments cease because of the death of the annuitant before
the total amount of the investment in the contract is recovered, the unrecovered
amount generally will be allowed as a deduction to the Owner for the last
taxable year.
TAXATION OF ANNUITY DEATH BENEFITS
Amounts may be distributed from an annuity contract because of the death of
an owner or annuitant. Generally, such amounts are includible in income as
follows: (1) if distributed in a lump sum, the amounts are taxed in the same
manner as a full withdrawal or (2) if distributed under an annuity option, the
amounts are taxed in the same manner as an annuity payment.
PENALTY TAX ON PREMATURE DISTRIBUTIONS
There is a 10% penalty tax on the taxable amount of any premature
distribution from a non-qualified annuity contract. The penalty tax generally
applies to any distribution made prior to the owner attaining age 59 1/2.
However, there should be no penalty tax on distributions to owners (1) made on
or after the owner attains age 59 1/2; (2) made as a result of the owner's death
or disability; (3) made in substantially equal periodic payments over life or
life expectancy; (4) made under an immediate annuity; or (5) attributable to an
investment in the contract before August 14, 1982. Similar rules apply for
distributions under certain qualified contracts. A competent tax advisor should
be consulted to determine if any other exceptions to the penalty apply to your
specific circumstances.
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AGGREGATION OF ANNUITY CONTRACTS
All non-qualified deferred annuity contracts issued by the Company (or its
affiliates) to the same owner during any calendar year will be aggregated and
treated as one annuity contract for purposes of determining the taxable amount
of a distribution.
TAX QUALIFIED CONTRACTS
Annuity contracts may be used as investments with certain tax qualified
plans such as: (1) Individual Retirement Annuities under Section 408(b) of the
Code; (2) Simplified Employee Pension Plans under Section 408(k) of the Code;
(3) Tax Sheltered Annuities under Section 403(b) of the Code; (4) Corporate and
Self Employed Pension and Profit Sharing Plans; and (5) State and Local
Government and Tax-Exempt Organization Deferred Compensation Plans. In the case
of certain tax qualified plans, the terms of the plans may govern the right to
benefits, regardless of the terms of the contract.
RESTRICTIONS UNDER SECTION 403(B) PLANS
Section 403(b) of the Code provides for tax-deferred retirement savings
plans for employees of certain non-profit and educational organizations. In
accordance with the requirements of Section 403(b), any annuity contract used
for a 403(b) plan must provide that distributions attributable to salary
reduction contributions made after 12/31/88, and all earnings on salary
reduction contributions, may be made only after the employee attains age 59 1/2,
separates from service, dies, becomes disabled or on account of hardship
(earnings on salary reduction contributions may not be distributed on the
account of hardship). These limitations do not apply to withdrawals where the
Company is directed to transfer some or all of the contract value to another
Section 403(b) plans.
INCOME TAX WITHHOLDING
The Company is required to withhold federal income tax at a rate of 20% on
all "eligible rollover distributions" unless an individual elects to make a
"direct rollover" of such amounts to another qualified plan or Individual
Retirement Account or Annuity (IRA). Eligible rollover distributions generally
include all distributions from qualified contracts, excluding IRAs, with the
exception of (1) required minimum distributions, or (2) a series of
substantially equal periodic payments made over a period of at least 10 years,
or the life (joint lives) of the participant (and beneficiary). For any
distributions from non-qualified annuity contracts, or distributions from
qualified contracts which are not considered eligible rollover distributions,
the Company may be required to withhold federal and state income taxes unless
the recipient elects not to have taxes withheld and properly notifies the
Company of such election.
DISTRIBUTION OF THE CONTRACTS
Allstate Life Financial Services, Inc. ("ALFS"), 3100 Sanders Road,
Northbrook Illinois, an indirect wholly owned subsidiary of Allstate Insurance
Company, acts as the principal underwriter of the Contracts. ALFS is registered
as a broker-dealer under the Securities Exchange Act of 1934 and became a member
of the National Association of Securities Dealers, Inc. on June 30, 1993.
Contracts are sold by registered representatives of broker-dealers or bank
employees who are licensed insurance agents appointed by the Company, either
individually or through an incorporated insurance agency. Contracts may be sold
by representatives or employees of banks which may be acting as broker-dealers
without separate registration under the Securities Exchange Act of 1934,
pursuant to legal and regulatory exceptions.
Commissions paid may vary, but in aggregate are not anticipated to exceed
6.75% of any purchase payment. In addition, under certain circumstances, certain
sellers of the Contracts may be paid persistency bonuses which will take into
account, among other things, the length of time purchase payments have been held
under a Contract, and the amount of purchase payments. A persistency bonus is
not expected to exceed .25%, on an annual basis, of the purchase payments
considered in connection with the bonus. These commissions are intended to cover
distribution expenses. All Commissions are paid by the Company and not by the
separate account.
The underwriting agreement with ALFS provides for indemnification of ALFS by
the Company for liability to Owners arising out of services rendered or
Contracts issued.
VOTING RIGHTS
The Owner or anyone with a voting interest in the Sub-account of the
Variable Account may instruct the Company on how to vote at shareholder meetings
of the Fund Series. The Company will solicit and cast each vote according to the
procedures set up by the Fund Series and to the extent required by law. The
Company reserves the right to vote the eligible shares in its own right, if
subsequently permitted by the Investment Company Act of 1940, its regulations or
interpretations thereof.
Fund shares as to which no timely instructions are received will be voted in
proportion to the voting instructions which are received with respect to all
Contracts participating in that Sub-account. Voting instructions to abstain on
any item to be voted upon will be applied on a pro-rata basis to reduce the
votes eligible to be cast.
Before the Payout Start Date, the Owner holds the voting interest in the
Sub-account of the Variable Account (The number of votes for the Owner will be
determined by dividing the Contract Value attributable to a Sub-account by the
net asset value per share of the applicable eligible Fund.)
19
<PAGE>
After the Payout Start Date, the person receiving income payments has the
voting interest. After the Payout Start Date, the votes decrease as income
payments are made and as the reserves for the Contract decrease. That person's
number of votes will be determined by dividing the reserve for such Contract
allocated to the applicable Sub-account by the net asset value per share of the
corresponding eligible Fund.
SELECTED FINANCIAL DATA
The following selected financial data for the Company should be read in
conjunction with the financial statements and notes thereto included in this
Prospectus beginning on page F-1.
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
SELECTED FINANCIAL DATA
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR-END FINANCIAL DATA 1994 1993 1992
- - ---------------------------------------------------------------------------------------- --------- --------- ---------
<S> <C> <C> <C>
For The Years Ended December 31:
Income Before Taxes................................................................... $ $ $
Net Income............................................................................
As of December 31:
Total Assets(1).....................................................................
</TABLE>
- - ------------
(1) The Company adopted SFAS No. 115, "Accounting for Certain Investments in
Debt and Equity Securities" on December 31, 1993. See Note 3 to the
Financial Statements.
COMPETITION
The Company is engaged in a business that is highly competitive because of
the large number of stock and mutual life insurance companies and other entities
competing in the sale of insurance and annuities. There are approximately 2,000
stock, mutual and other types of insurers in business in the United States.
Several independent rating agencies regularly evaluate life insurer's
claims-paying ability, quality of investments and overall stability. A.M. Best
Company assigns A+g (Superior) to the Company. A.M. Under Best's rating policy
and procedure, the Company is assigned the Best's rating of its parent Company,
and is based on the consolidated performance of the parent and its subsidiary.
Standard & Poor's Insurance Rating Services assigns AA+ (Excellent) to the
Company and Moody's assigns an Aa3 (Excellent) financial stability rating to the
Company. These ratings do not relate to the investment performance of the
Variable Account.
EMPLOYEES
As of December 31, 1994, the Company has approximately 72 employees at its
home office in Farmingville, New York who work primarily on the Company's
matters.
PROPERTIES
The Company occupies office space in Farmingville, New York which is owned
by its parent company.
STATE AND FEDERAL REGULATION
The insurance business of the Company is subject to comprehensive and
detailed regulation and supervision in the State of New York. The laws of New
York establish a supervisory agency with broad administrative powers with
respect to licensing to transact business, overseeing trade practices, licensing
agents, approving policy forms, establishing reserve requirements, fixing
maximum interest rates on life insurance policy loans and minimum rates for
accumulation of surrender values, prescribing the form and content of required
financial statements and regulating the type and amounts of investments
permitted. Each insurance company is required to file detailed annual reports
with the supervisory agency and its operations and accounts are subject to
examination by such agency at regular intervals.
Under insurance guaranty fund law, for the State of New York, insurers doing
business therein can be assessed up to prescribed limits for contract owner
losses incurred as a result of company insolvencies. The amount of any future
assessments on the Company under these laws cannot be reasonably estimated.
These laws do provide, however, that an assessment may be excused or deferred if
it would threaten an insurer's own financial strength.
In addition, the State of New York regulates affiliated groups of insurers,
such as the Company and its affiliates, under insurance holding company
legislation. Under such laws, intercompany transfers of assets and dividend
payments from insurance subsidiaries may be subject to prior notice or approval,
depending on the size of such transfers and payments in relation to the
financial positions of the companies.
20
<PAGE>
Although the federal government generally does not directly regulate the
business of insurance, federal initiatives often have an impact on the business
in a variety of ways. Current and proposed federal measures which may
significantly affect the insurance business include employee benefit regulation,
controls on medical care costs, removal of barriers preventing banks from
engaging in the securities and insurance business, tax law changes affecting the
taxation of insurance companies, the tax treatment of insurance products and its
impact on the relative desirability of various personal investment vehicles, and
proposed legislation to prohibit the use of gender in determining insurance and
pension rates and benefits.
EXECUTIVE OFFICERS AND DIRECTORS OF THE COMPANY
The directors and executive officers are listed below, together with
information as to their ages, dates of election and principal business
occupations during the last five years (if other than their present business
occupations).
LOUIS G. LOWER, II, 50, Chief Executive Officer and Chairman of the Board
(1992)*
He is also President and Chairman of the Board of Directors of Allstate Life
Insurance Company, Northbrook Life Insurance Company, Glenbrook Life and Annuity
Company, Glenbrook Life Insurance Company, and The Northbrook Corporation;
Chairman of the Board of Directors and Chief Executive Officer of Surety Life
Insurance Company and Lincoln Benefit Life Company; Chairman of the Board of
Directors of Allstate Settlement Corporation; Director and Senior Vice President
of Allstate Insurance Company; Vice President of the Allstate Foundation; and
Director of Allstate Life Financial Services, Inc., Allstate Indemnity Company,
Allstate Property and Casualty Insurance Company, Deerbrook Insurance Company,
Northbrook Indemnity Company, Northbrook National Insurance Company, Northbrook
Property and Casualty Insurance Company, Allstate International, Inc. and Saison
Life Insurance Company, Ltd. Prior to 1990, he was Executive Vice President of
Allstate Life Insurance Company. From 1992 to 1995, in addition to his position
as Chairman of the Board, he was also President of the Company.
MICHAEL J. VELOTTA, 49, Vice President, Secretary, General Counsel, and Director
(1993)*
He is also Vice President, Secretary, General Counsel and Director of
Allstate Life Insurance Company, Northbrook Life Insurance Company, Glenbrook
Life Insurance Company and Glenbrook Life and Annuity Company; Secretary and
Director of Allstate Settlement Corporation, Allstate Life Financial Services,
Inc. and The Northbrook Corporation; and Director of Surety Life Insurance
Company and Lincoln Benefit Life Company. Prior to 1993, he was Vice President
and Assistant General Counsel of Allstate Insurance Company.
PETER H. HECKMAN, 50, Vice President and Director (1992)*
He is also Vice President and Director of Allstate Life Insurance Company,
Northbrook Life Insurance Company, Glenbrook Life Insurance Company, Allstate
Settlement Corporation and Glenbrook Life and Annuity Company; Vice President
and Controller of The Northbrook Corporation; and Director of Surety Life
Insurance Company and Lincoln Benefit Life Company. Prior to 1992, he was Vice
President and Director of Allstate Life Insurance Company, Northbrook Life
Insurance Company, Glenbrook Life Insurance Company and Glenbrook Life and
Annuity Company.
JAMES J. BRAZDA, 51, Chief Administrative Officer and Director (1983)*
James J. Brazda is also a Department Manager for Allstate Life Insurance
Company.
TIMOTHY H. PLOHG, 49, Vice President and Director (1995)*
Timothy H. Plohg is also Vice President and Director of Allstate Life
Insurance Company. Prior to 1995, he was Vice President of the ALSC; Assistant
Vice President Sales, Regional Vice President.
MARCIA D. ALAZRAKI, 54, Director (1993)*
Marcia D. Alazrski is an attorney practicing with the firm of Simpson,
Thacher & Bartlett, New York, New York. Prior to 1991, she practiced with the
firm of Shea & Gould, New York, New York.
JOSEPH F. CARLINO, 78, Director (1983)*
Joseph F. Carlino is a self-employed practicing attorney in Mineola, New
York.
CLEVELAND JOHNSON, JR., 60, Director (1983)*
Cleveland Johnson, Jr. is currently a Business Development Advocate for the
Town of Islip, Division of Economic Development. Previously he was a Vice
President with State University of New York in Farmingdale, New York.
PHILLIP E. LAWSON, 42, Director (1994)*
Phillip E. Lawson is also a Regional Vice President of Allstate Insurance
Company. Prior to 1990, he was a Director of Allstate Insurance Company.
GERARD F. MCDERMOTT, 49, Director (1995)*
Gerard F. McDermott is also a Regional Vice president of Allstate Insurance
Company. Prior to 1992, he held various management positions.
21
<PAGE>
JOSEPH P. MCFADDEN, 56, Director (1992)*
Joseph P. McFadden is also a Territorial Vice President of Allstate
Insurance Company. Prior to 1992, he was a Claim Vice President of Allstate
Insurance Company.
JOHN R. RABEN, JR., 50, Director (1988)*
John R. Raben, Jr. is a Vice President & Municipal Bond/Public Finance
Liaison with J.P. Morgan Securities, Inc.
THEODORE A. SCHNELL, 47, Director (1995)*
Theodore A. Schnell is also Assistant Treasurer of Glenbrook Life & Annuity
Company, Glenbrook Life Insurance Company and Allstate Life Insurance Company.
SALLY A. SLACKE, 62, Director (1983)*
Sally A. Slacke is also President of Slacke Test Boring, Inc.
CASEY J. SYLLA, 52, Chief Investment Officer (1995)*
Casey J. Sylla is also Director of Allstate Insurance Company, Allstate
Indemnity Company, Allstate Property and Casualty Insurance Company, Deerbrook
Insurance Company, First Assurance Company, Northbrook Indemnity Company,
Northbrook National Insurance Company, Northbrook Property and Casualty
Insurance Company. He is also Chief Investment Officer of Glenbrook Life and
Annuity Company, Allstate Settlement Corporation, The Northbrook Corporation,
Allstate Insurance Company, Allstate Indemnity Company, Allstate Property and
Casualty, Deerbrook Insurance Company, First Assurance Company, Northbrook
Indemnity Company, Northbrook National Insurance Company, Northbrook Property
and Casualty Insurance Company. Prior to 1995, he was Senior Vice President and
Executive Officer Investments for Northwestern Mutual Life Insurance Company.
BARRY S. PAUL, 40, Assistant Vice President and Controller (1992)*
He is also Assistant Vice President and Controller of Allstate Life
Insurance Company, Northbrook Life Insurance Company, Glenbrook Life and Annuity
Company and Glenbrook Life Insurance Company. Prior to 1992, he was Assistant
Vice President of Allstate Life Insurance Company and Northbrook Life Insurance
Company.
JAMES P. ZILS, 44, Treasurer (1995)*
James P. Zils is also Treasurer of Allstate Life Financial Services, Inc.,
Allstate Settlement Corporation, Allstate Life Insurance Company, Glenbrook Life
and Annuity Company, Glenbrook Life Insurance Company, Northbrook Life Insurance
Company, The Northbrook Corporation. He is Treasurer and Vice President of AEI
Group, Inc., Allstate International Inc., Allstate Motor Club, Inc., Direct
Marketing Center, Inc., Enterprises Services Corporation, The Allstate
Foundation, Forestview Mortgage Insurance Company, Allstate Indemnity Company,
Allstate Property and Casualty, Deerbrook Insurance Company, First Assurance
Company, Northbrook Indemnity Company, Northbrook National Insurance Company,
Northbrook Property and Casualty Insurance Company. Prior to 1995 he was Vice
President of Allstate Life Insurance Company. Prior to 1993 he held various
management positions.
* Date elected/appointed to current office.
EXECUTIVE COMPENSATION
Executive officers of the Company also serve as officers of its parent
company and receive no compensation directly from the Company. Some of the
officers also serve as officers of other companies affiliated with the Company.
Allocations have been made as to each individual's time devoted to his or her
duties as an executive officer of the Company. However, no officer's
compensation allocated to the Company exceeded $100,000 in 1994. The allocated
cash compensation of all officers of the Company as a group for services
rendered in all capacities to the Company during 1994 totaled $9,216.31.
Directors of the Company receive no compensation in addition to their
compensation as employees of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
----------------------------
AWARDS PAYOUTS
---------------------------- -----------
(G)
------------------------------------- (E) (F) SECURITIES (H)
OTHER ANNUAL RESTRICTED UNDERLYING LTIP
(A) (B) (C) (D) COMPENSATION STOCK OPTIONS/ PAYOUTS
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) $ AWARD(S) SARS(#) ($)
- - --------------------------- --- ----------- ----------- --------------- ----------- --------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Louis G. Lower, II......... 1994 $ 389,050 $ 26,950 $ 25,889 $ 170,660 N/A 0
President and Chairman 1993 $ 374,200 $ 294,683 $ 52,443 $ 318,625 N/A $ 13,451
of the Board of Directors 1992 $ 356,625 0 $ 11,981 $ 206,388 N/A $ 173,561
<CAPTION>
(I)
ALL OTHER
(A) COMPENSATION
NAME AND PRINCIPAL POSITION ($)
- - --------------------------- ---------------
<S> <C>
Louis G. Lower, II......... $ 1,890(1)
President and Chairman $ 6,296(1)
of the Board of Directors $ 2,095(1)
</TABLE>
- - ------------
(1) Amount received by Mr. Lower which represents the value allocated to his
account from employer contributions under The Savings and Profit Sharing
Fund of Sears employees.
22
<PAGE>
Shares of the Company are not directly owned by any director or officer of
the Company. The percentage of shares of The Allstate Corporation beneficially
owned by any director, and by all directors and officers of the Company as a
group, does not exceed one percent of the class outstanding.
LEGAL PROCEEDINGS
From time to time the Company is involved in pending and threatened
litigation in the normal course of its business in which claims for monetary
damages are asserted. Management, after consultation with legal counsel, does
not anticipate the ultimate liability arising from such pending or threatened
litigation to have a material effect on the financial condition of the Company.
EXPERTS
The financial statements and financial statement schedule of the Company
have been audited by Deloitte & Touche LLP, Two Prudential Plaza, 180 North
Stetson Avenue, Chicago, Illinois, 60601-6779, independent auditors, as stated
in their report appearing herein, and are included in reliance upon the report
of such firm given upon their authority as experts in accounting and auditing.
LEGAL MATTERS
Certain legal matters relating to the federal securities laws applicable to
the issue and sale of the Contracts have been passed upon by Routier and
Johnson, P.C., of Washington, D.C. All matters of New York law pertaining to the
Contracts, including the validity of the Contracts and the Company's right to
issue such Contracts under New York insurance law, have been passed upon by
Michael J. Velotta, General Counsel of the Company.
23
<PAGE>
APPENDIX A
MARKET VALUE ADJUSTMENT
The Market Value Adjustment is based on the following:
<TABLE>
<S> <C> <C>
I = the Treasury Rate for a maturity equal to the Sub-account's Guarantee Period for the
week preceding the establishment of the Sub-account.
N = the number of whole and partial years from the date we receive the withdrawal, or
death benefit request, or from the Payout Start Date to the end of the Sub-account's
Guarantee Period.
J = the Treasury Rate for a maturity of length N for the week preceding the receipt of the
withdrawal request, death benefit request, or income payment request. If a Note with a
maturity of length N is not available, a weighted average will be used. If N is one
year or less, J will be the 1-year Treasury Rate.
</TABLE>
Treasury Rate means the U.S. Treasury Note Constant Maturity yield as
reported in Federal Reserve Bulletin Release H.15.
The Market Value Adjustment factor is determined from the following formula:
.9 X (I-J) X N
Any transfer, withdrawal in excess of the preferred withdrawal amount, or
death benefit paid from a Sub-account of the Fixed Account will be multiplied by
the Market Value Adjustment factor to determine the Market Value Adjustment.
ILLUSTRATION
EXAMPLE OF MARKET VALUE ADJUSTMENT
<TABLE>
<S> <C>
Purchase
Payment: $10,000
Guarantee
Period: 5 Years
Interest Rate: 4.35%
Full End of Contract Year
Withdrawal: 3
</TABLE>
NOTE: THIS ILLUSTRATION ASSUMES THAT PREMIUM TAXES WERE NOT APPLICABLE.
EXAMPLE 1: (ASSUMES DECLINING INTEREST RATES)
Step 1: Calculate Account Value at End of Contract Year 3:
= 10,000.00 X (1.0435)3 = $11,362.59
Step 2: Calculate the Free Withdrawal Amount:
= 10% X (10,000.00) = $1,000.00
Step 3: Calculate the Market Value Adjustment:
I = 5.55%
J = 5.05%
N = 730 days = 2
------
365 days
Market Value Adjustment Factor: .9 X (I-J) X N
= .9 X (.0555 - .0505) X 2 = .009
Market Value Adjustment = Factor X Amount Subject to Market Value Adjustment:
= .009 X (11,493.76 - 1,000) = $94.44
A-1
<PAGE>
<TABLE>
<S> <C> <C> <C>
Step 4: Calculate the Withdrawal Charge:
= .05 X (10,000.00 - 1,000.00) = $450.00
Step 5: Calculate The Amount Received by Customers as a Result of a Full Withdrawal at the end
of Contract Year 3:
= 11,362.59 - 450.00 + 94.44 = $11,007.83
EXAMPLE 2: (ASSUMES RISING INTEREST RATES)
Step 1: Calculate Account Value at End of Contract Year 3:
= 10,000.00 X (1.0435)3 = $11,362.59
Step 2: Calculate the Preferred Withdrawal Amount
= 10% X (10,000.00) = $1,000.00
Step 3: Calculate the Market Value Adjustment:
I = 5.55%
J = 6.05%
N = 730 days = 2
----------
365 days
Market Value Adjustment Factor: .9 X (I-J) X N
= .9 X (.0555 - .0605) X (2) = -.009
Market Value Adjustment = Factor X Amount Subject to Market Value Adjustment:
= -.009 X ($11,493.76 - 1,000) = -94.44
Step 4: Calculate the Withdrawal Charge:
= .05 X (10,000.00 - 1,000.00) = $450.00
Step 5: Calculate The Net Withdrawl Value at End of Contract Year 3:
= 11,362.59 - 450.00 - 94.44 = $10,828.15
</TABLE>
A-2
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION: TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
ADDITIONS, DELETIONS OR SUBSTITUTIONS OF INVESTMENTS............................................................. 3
REINVESTMENT..................................................................................................... 3
THE CONTRACT..................................................................................................... 4
Purchase of Contracts.......................................................................................... 4
Performance Data............................................................................................... 4
Tax-free Exchanges (1035 Exchanges, Rollovers and Transfers)................................................... 5
Premium Taxes.................................................................................................. 6
Tax Reserves................................................................................................... 6
INCOME PAYMENTS.................................................................................................. 6
Calculation of Variable Annuity Unit Values.................................................................... 6
GENERAL MATTERS.................................................................................................. 7
Incontestability............................................................................................... 7
Settlements.................................................................................................... 7
Safekeeping of the Variable Account's Assets................................................................... 7
FEDERAL TAX MATTERS.............................................................................................. 7
Introduction................................................................................................... 7
Taxation of Allstate Life Insurance Company of New York........................................................ 8
Exceptions to the Non-Natural Owner Rule....................................................................... 8
IRS Required Distribution at Death Rules....................................................................... 8
Qualified Plans................................................................................................ 9
Types of Qualified Plans....................................................................................... 9
VARIABLE ACCOUNT FINANCIAL STATEMENTS............................................................................ 11
</TABLE>
B-1
<PAGE>
ORDER FORM
Please send me a copy of the most recent Statement of Additional Information
for the Allstate Life of New York Separate Account A.
<TABLE>
<S> <C>
- - -------------- -------------------------------------------
(Date) (Name)
-------------------------------------------
(Street Address)
-------------------------------------------
(City) (State) (Zip
Code)
</TABLE>
Send to:
Allstate Life Insurance Company of New York
Post Office Box 9095
Farmingville, New York 11738
Attention: VA Customer Service Unit
B-2
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
ALLSTATE LIFE OF NEW YORK SEPARATE ACCOUNT A
OFFERED BY
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
POST OFFICE BOX 9095
FARMINGVILLE, NEW YORK 11738
1-(800)__________
GROUP FLEXIBLE PREMIUM DEFERRED
VARIABLE ANNUITY CONTRACTS
This Statement of Additional Information supplements the information in the
prospectus for the Group Flexible Premium Deferred Variable Annuity Contract
offered by Allstate life Insurance Company of New York ("Company"), an indirect
wholly owned subsidiary of Allstate Insurance Company. The Contract is
primarily designed to aid individuals in long-term financial planning and it can
be used for retirement planning regardless of whether the plan qualifies for
special federal income tax treatment. The prospectus may be obtained from
Allstate Life Insurance Company of New York by writing or calling the address or
telephone number listed above.
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
ONLY IN CONJUNCTION WITH THE PROSPECTUS FOR THE CONTRACT
The prospectus, dated , 1996, has been filed with the United States
Securities and Exchange Commission
DATED , 1996
<PAGE>
TABLE OF CONTENTS
PAGE
----
Additions, Deletions or Substitutions of Investments . . . . . . . . . . . . . 3
Reinvestment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
The Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Purchase of Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Performance Data. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Tax-free Exchanges (1035 Exchanges, Rollovers and
Transfers) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Tax Reserves. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Income Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Calculation of Variable Annuity Unit Values . . . . . . . . . . . . . . . 6
General Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Incontestability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Safekeeping of the Variable Account's Assets. . . . . . . . . . . . . . . 7
Federal Tax Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Taxation of Allstate Life Insurance Company of New York . . . . . . . . . 8
Exceptions to the Non-Natural Owner Rule. . . . . . . . . . . . . . . . . 8
IRS Required Distribution at Death Rules. . . . . . . . . . . . . . . . . 8
Qualified Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Types of Qualified Plans. . . . . . . . . . . . . . . . . . . . . . . . . 9
Variable Account Financial Statements. . . . . . . . . . . . . . . . . . . . .11
2
<PAGE>
ADDITIONS, DELETIONS OR SUBSTITUTIONS OF INVESTMENTS
The Company retains the right, subject to any applicable law, to make
additions to, deletions from or substitutions for the Fund shares held by any
Sub-account of the Variable Account. The Company reserves the right to
eliminate the shares of any of the Funds and to substitute shares of another
Fund of the Fund Series, or of another open-end, registered investment company,
if the shares of the Fund are no longer available for investment, or if, in the
Company's judgment, investment in any Fund would become inappropriate in view of
the purposes of the Variable Account. Substitutions of shares attributable to
an Owner's interest in a Sub-account will not be made until the Owner has been
notified of the change, and until the Securities and Exchange Commission has
approved the change, to the extent such notification and approval is required by
the Investment Company Act of 1940. Nothing contained in this Statement of
Additional Information shall prevent the Variable Account from purchasing other
securities for other series or classes of contracts, or from effecting a
conversion between series or classes of contracts on the basis of requests made
by Owners.
The Company may also establish additional Sub-accounts or series of
Sub-accounts of the Variable Account. Each additional Sub-account would
purchase shares in a new Fund of the Fund Series or in another mutual fund. New
Sub-accounts may be established when, in the sole discretion of the Company,
marketing needs or investment conditions warrant. Any new Sub-accounts offered
in conjunction with the Contract will be made available to existing Owners on a
basis to be determined by the Company. The Company may also eliminate one or
more Sub-accounts if, in its sole discretion, marketing, tax or investment
conditions so warrant.
In the event of any such substitution or change, the Company may, by
appropriate endorsement, make such changes in the Contract as may be necessary
or appropriate to reflect such substitution or change. If deemed to be in the
best interests of persons having voting rights under the policies, the Variable
Account may be operated as a management company under the Investment Company Act
of 1940 or it may be deregistered under such Act in the event such registration
is no longer required.
3
<PAGE>
REINVESTMENT
All dividends and capital gains distributions from the Funds are
automatically reinvested in shares of the distributing Fund at their net asset
value.
THE CONTRACT
PURCHASE OF THE CONTRACTS
The Contracts are offered to the public through brokers as well as banks
licensed under the federal securities laws and state insurance laws. The
Contracts are distributed through the principal underwriter for the Variable
Account, Allstate Life Financial Services, Inc., an affiliate of Allstate Life
Insurance Company of New York. The offering of the Contracts is continuous and
the Company does not anticipate discontinuing the offering of the Contracts.
However, the Company reserves the right to discontinue the offering of the
Contracts.
PERFORMANCE DATA
From time to time the Variable Account may publish advertisements
containing performance data relating to its Sub-accounts. The performance data
for the Sub-accounts (other than for the AIM V.I. Money Market Sub-account) will
always be accompanied by total return quotations. Performance figures used by
the Variable Account are based on actual historical performance of its
Sub-accounts for specified periods, and the figures are not intended to indicate
future performance. The Variable Account may also disclose yield, standard
total return, and non-standard total return for periods prior to the date that
the Variable Account commenced operations. For periods prior to the date the
Variable Account commenced operations, performance information for the
Sub-accounts will be calculated based on the performance of the underlying Funds
and the assumption that the Sub-accounts were in existence for the same periods
as those of the underlying Funds, with a level of charges equal to those
currently assessed against the Sub-accounts.
A Sub-account's "average annual total return" represents an annualization
of the Sub-account's total return over a particular period and is computed by
finding the annual percentage rate which, when compounded annually, will
accumulate a hypothetical $1,000 purchase payment to the redeemable value at the
end of the one, five or ten year period, or for a period from the date of
commencement of the Sub-account's operations, if shorter than any of the
foregoing. The average annual total return is obtained by dividing the ending
redeemable value, after deductions for any withdrawal charges or contract
maintenance charges imposed on the
4
<PAGE>
Contracts by the Variable Account, by the initial hypothetical $1,000 purchase
payment, taking the "n"th root of the quotient (where "n" is the number of years
in the period) and subtracting 1 from the result.
The withdrawal charges assessed upon redemption are computed as follows:
the preferred withdrawal amount is not assessed a withdrawal charge. Withdrawal
charges are charged on the amount of redemption equal to the purchase payment,
reduced by the amount of the preferred withdrawal amount, if any. The remaining
amount of the redemption, if any, is not assessed a withdrawal charge. The
withdrawal charge schedule specifies rates based on the number of complete years
since each purchase payment was made. The contract maintenance charge ($35 per
contract) used in the total return calculation is normally prorated using the
following method: The total amount of annual Contract fees collected during the
year is divided by the total average net assets of all the Sub-accounts. The
resulting percentage is then multiplied by the ending Contract Value.
In addition, the Variable Account may advertise the total return over
different periods of time by means of aggregate, average, year-by-year or other
types of total return figures. Such calculations would not reflect deductions
for withdrawal charges which may be imposed on the Contracts by the Variable
Account which, if reflected, would reduce the performance quoted. The formula
for computing such total return quotations involves a per unit change
calculation. This calculation is based on the Accumulation Unit value at the
end of the defined period divided by the Accumulation Unit value at the
beginning of such period, minus 1. The periods included in such advertisements
are "year-to-date" (prior calendar year end to the day of the advertisement);
"year to most recent quarter" (prior calendar year end to the end of the most
recent quarter); "the prior calendar year"; "'n' most recent Calendar Years";
and "Inception (commencement of the Sub-account's operation) to date" (day of
the advertisement).
The Variable Account may also advertise the performance of the Sub-accounts
relative to certain performance rankings and indexes compiled by independent
organizations, such as: (a) Lipper Analytical Services, Inc.; (b) the Standard
& Poor's 500 Composite Stock Price Index ("S & P 500"); (c) A.M. Best Company;
(d) Bank Rate Monitor; and (e) Morningstar.
TAX-FREE EXCHANGES (1035 EXCHANGES, ROLLOVERS AND TRANSFERS)
The Company accepts purchase payments which are the proceeds of a
Contract in a transaction qualifying for a tax-free exchange under Section 1035
of the Internal Revenue Code. Except as required by federal law in calculating
the basis of the Contract, the Company does not differentiate between Section
1035 purchase payments and non-Section 1035 purchase payments.
The Company also accepts "rollovers" and transfers from Contracts
qualifying as tax-sheltered annuities ("TSAs"), individual retirement annuities
or accounts ("IRAs"), or any
5
<PAGE>
other Qualified Contract which is eligible to "rollover" into an IRA. The
Company differentiates among Non-Qualified Contracts, TSAs, IRAs and other
Qualified Contracts to the extent necessary to comply with federal tax laws.
For example, the Company restricts the assignment, transfer or pledge of TSAs
and IRAs so the Contracts will continue to qualify for special tax treatment.
An Owner contemplating any such exchange, rollover or transfer of a Contract
should contact a competent tax adviser with respect to the potential effects of
such a transaction.
TAX RESERVES
Company does not establish capital gains tax reserves for the Sub-account
nor deduct charges for tax reserves because the Company believes that capital
gains attributable to the Variable Account will not be taxable. However, the
Company reserves the right to deduct charges to establish tax reserves for
potential taxes on realized or unrealized capital gains.
INCOME PAYMENTS
CALCULATION OF VARIABLE ANNUITY UNIT VALUES
The amount of the first income payment is calculated by applying the
Contract Value allocated to each Variable Sub-account less any applicable
premium tax charge deducted at this time, to the income payment tables in the
Contract. The first variable annuity income payment is divided by the
Sub-account's then current annuity unit value to determine the number of annuity
units upon which later income payments will be based. Variable annuity income
payments after the first will be equal to the sum of the number of annuity units
determined in this manner for each Sub-account times the then current annuity
unit value for each respective Sub-account.
Annuity units in each variable Sub-account are valued separately and
annuity unit values will depend upon the investment experience of the particular
portfolios in which the Sub-account invests. The value of the annuity unit for
each variable Sub-account at the end of any Valuation Period is calculated by:
(a) multiplying the annuity unit Value at the end of the immediately preceding
Valuation Period by the Sub-accounts's net investment factor during the period;
and then (b) dividing the product by the sum of 1.0 plus the assumed investment
rate for the period. The assumed investment rate adjusts for the interest rate
assumed in the income payment tables used to determine the dollar amount of the
first variable annuity income payment, and is at an effective annual rate which
is disclosed in the Contract.
The amount of the first income payment paid under an income plan is
determined using the interest rate and mortality table disclosed in the
Contract. Due to judicial or legislative developments regarding the use of
tables which do not differentiate on the basis of sex, different annuity tables
may be used.
6
<PAGE>
GENERAL MATTERS
INCONTESTABILITY
The Contract will not be contested after it is issued.
SETTLEMENTS
Due proof of the Owner(s) death (or Annuitant's death if there is a
non-natural Owner) must be received prior to settlement of a death claim.
SAFEKEEPING OF THE VARIABLE ACCOUNT'S ASSETS
The Company holds title to the assets of the Variable Account. The assets
are kept physically segregated and held separate and apart from the Company's
general corporate assets. Records are maintained of all purchases and
redemptions of the Fund shares held by each of the variable Sub-accounts.
The Fund does not issue certificates and, therefore, the Company holds the
Account's assets in open account in lieu of stock certificates. See the Fund's
prospectus for a more complete description of the custodian of the Fund.
FEDERAL TAX MATTERS
INTRODUCTION
THE FOLLOWING DISCUSSION IS GENERAL AND IS NOT INTENDED AS TAX ADVICE. THE
COMPANY MAKES NO GUARANTEE REGARDING THE TAX TREATMENT OF ANY CONTRACT OR
TRANSACTION INVOLVING A CONTRACT. Federal, state, local and other tax
consequences of ownership or receipt of distributions under an annuity contract
depend on the individual circumstances of each person. If you are concerned
about any tax consequences with regard to your individual circumstances, you
should consult a competent tax adviser.
TAXATION OF ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
7
<PAGE>
The Company is taxed as a life insurance company under Part I of Subchapter
L of the Internal Revenue Code. Since the Variable Account is not an entity
separate from the Company, and its operations form a part of the Company, it
will not be taxed separately as a "Regulated Investment Company" under
Subchapter M of the Code. Investment income and realized capital gains are
automatically applied to increase reserves under the contract. Under existing
federal income tax law, the Company believes that the Variable Account
investment income and realized net capital gains will not be taxed to the extent
that such income and gains are applied to increase the reserves under the
contract.
Accordingly, the Company does not anticipate that it will incur any federal
income tax liability attributable to the Variable Account, and therefore the
Company does not intend to make provisions for any such taxes. However, if
changes in the federal tax laws or interpretations thereof result in the Company
being taxed on income or gains attributable to the Variable Account, then the
Company may impose a charge against the Variable Account (with respect to some
or all contracts) in order to set aside provisions to pay such taxes.
EXCEPTIONS TO THE NON-NATURAL OWNER RULE
There are several exceptions to the general rule that contracts held by a
non-natural owner are not treated as annuity contracts for federal income tax
purposes. Contracts will generally be treated as held by a natural person if
the nominal owner is a trust or other entity which holds the contract as agent
for a natural person. However, this special exception will not apply in the
case of an employer who is the nominal owner of an annuity contract under a
non-qualified deferred compensation arrangement for its employees. Other
exceptions to the non-natural owner rule are: (1) contracts acquired by an
estate of a decedent by reason of the death of the decedent; (2) certain
qualified contracts; (3) contracts purchased by employers upon the termination
of certain qualified plans; (4) certain contracts used in connection with
structured settlement agreements, and (5) contracts purchased with a single
premium when the annuity starting date is no later than a year from purchase of
the annuity and substantially equal periodic payments are made, not less
frequently than annually, during the annuity period.
IRS REQUIRED DISTRIBUTION AT DEATH RULES
In order to be considered an annuity contract for federal income tax
purposes, an annuity contract must provide: (1) if any owner dies on or after
the annuity start date but before the entire interest in the contract has been
distributed, the remaining portion of such interest must be distributed at least
as rapidly as under the method of distribution being used as of the date of the
owner's death; and (2) if any owner dies prior to the annuity start date, the
entire interest in the contract will be distributed within five years after the
date of the owner's death. These requirements are satisfied if any portion of
the owner's interest which is payable to (or for the
8
<PAGE>
benefit of) a designated beneficiary is distributed over the life of such
beneficiary (or over a period not extending beyond the life expectancy of the
beneficiary) and the distributions begin within one year of the owner's death.
If the owner's designated beneficiary is the surviving spouse of the owner, the
contract may be continued with the surviving spouse as the new owner. If the
owner of the contract is a non-natural person, then the annuitant will be
treated as the owner for purposes of applying the distribution at death rules.
In addition, a change in the annuitant on a contract owned by a non-natural
person will be treated as the death of the owner.
QUALIFIED PLANS
This annuity contract may be used with several types of qualified plans.
The tax rules applicable to participants in such qualified plans vary according
to the type of plan and the terms and conditions of the plan itself. Adverse tax
consequences may result from excess contributions, premature distributions,
distributions that do not conform to specified commencement and minimum
distribution rules, excess distributions and in other circumstances. Owners and
participants under the plan and annuitants and beneficiaries under the contract
may be subject to the terms and conditions of the plan regardless of the terms
of the contract.
TYPES OF QUALIFIED PLANS
INDIVIDUAL RETIREMENT ANNUITIES
Section 408 of the Code permits eligible individuals to contribute to an
individual retirement program known as an Individual Retirement Annuity.
Individual Retirement Annuities are subject to limitations on the amount that
can be contributed and on the time when distributions may commence. Certain
distributions from other types of qualified plans may be "rolled over" on a
tax-deferred basis into an Individual Retirement Annuity. IRAs generally may
not provide life insurance, but they may provide a death benefit that equals the
greater of the premiums paid and the contract's cash value. The contract
provides a death benefit that in certain circumstances may exceed the greater of
the payments and the contract value. It is possible that the Death Benefit
could be viewed as violating the prohibition on investment in life insurance
contracts with the result that the Contract would not be viewed as satisfying
the requirements of an IRA.
SIMPLIFIED EMPLOYEE PENSION PLANS
Section 408(k) of the Code allows employers to establish simplified
employee pension plans for their employees using the employees' individual
retirement annuities if certain criteria are met. Under these plans the
employer may, within specified limits, make deductible contributions on behalf
of the employees to their individual retirement annuities. Employers
9
<PAGE>
intending to use the contract in connection with such plans should seek
competent advice. In particular, employers should consider that IRAs generally
may not provide life insurance, but they may provide a death benefit that equals
the greater of the premiums paid and the contract's cash value. The contract
provides a death benefit that in certain circumstances may exceed the greater of
the payments and the contract value. It is possible that the death benefit
could be viewed as violating the prohibition on investment in life insurance
contracts with the result that the contract would not be viewed as satisfying
the requirements of the IRS.
TAX SHELTERED ANNUITIES
Section 403(b) of the Code permits public school employees and employees of
certain types of tax-exempt organizations (specified in Section 501(c)(3) of the
Code) to have their employers purchase annuity contracts for them, and subject
to certain limitations, to exclude the purchase payments from the employees'
gross income. An annuity contract used for a Section 403(b) plan must provide
that distributions attributable to salary reduction contributions made after
12/31/88, and all earnings on salary reduction contributions, may be made only
after the employee attains age 59 1/2, separates from service, dies, becomes
disabled or on the account of hardship (earnings on salary reduction
contributions may not be distributed for hardship). These limitations do not
apply to withdrawals where the Company is directed to transfer some or all of
the contract value to another Section 403(b) plan. Purchasers of the contracts
for such purposes should seek competent advice as to eligibility, limitations on
permissible amounts of purchase payments and other tax consequences associated
with the contracts. In particular, purchasers should consider that the contract
provides a death benefit that in certain circumstances may exceed the greater of
the payments and the contract value. It is possible that such death benefit
could be characterized as an incidental death benefit. If the death benefit
were so characterized, this could result in currently taxable income to
purchasers. In addition, there are limitations on the amount of incidental
death benefits that may be provided under a tax-sheltered annuity. Even if the
death benefit under the contract were characterized as an incidental death
benefit, it is unlikely to violate those limits unless the purchaser also
purchases a life insurance contract as part of his or her tax-sheltered annuity
plan.
CORPORATE AND SELF-EMPLOYED PENSION AND PROFIT SHARING PLANS
Sections 401(a) and 403(a) of the Code permit corporate employers to
establish various types of tax favored retirement plans for employees. The
Self-Employed Individuals Retirement Act of 1962, as amended, (commonly referred
to as "H.R. 10" or "Keogh") permits self-employed individuals to establish tax
favored retirement plans for themselves and their employees. Such retirement
plans may permit the purchase of annuity contracts in order to provide benefits
under the plans. The contract provides a death benefit that in certain
circumstances may exceed the greater of the payments and the contract value. It
is possible that such death benefit could be characterized as an incidental
death benefit. There are limitations on
10
<PAGE>
the amount of incidental benefits that may be provided under pension and profit
sharing plans. In addition, the provision of such benefits may result in
currently taxable income to participants. Employers intending to use the
contract in connection with such plans should seek competent advice.
STATE AND LOCAL GOVERNMENT AND TAX-EXEMPT ORGANIZATION
DEFERRED COMPENSATION PLANS
Section 457 of the Code permits employees of state and local governments
and tax-exempt organizations to defer a portion of their compensation without
paying current taxes. The employees must be participants in an eligible
deferred compensation plan. Under these plans, contributions made for the
benefit of the employees will not be includible in the employees' gross income
until distribution from the plan. However, under a Section 457 plan all the
compensation deferred under the plan must remain solely the property of the
employer, subject only to the claims of the employer's general creditors, until
such time as made available to the employee or a beneficiary.
VARIABLE ACCOUNT FINANCIAL STATEMENTS
The financial statements of Allstate Life of New York Separate Account A
are not included herein because, as of the date hereof, the Variable Account had
not yet commenced operations, had no assets or liabilities and received no
income. The financial statements of the Variable Account will be audited on an
annual basis once the Variable Account commences operations.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, (the "Act"),
and the Investment Company Act of 1940, the registrant, Allstate Life
Insurance Company of New York, Separate Account A has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereunto affixed and attested,
all in the Township of Northfield, State of Illinois, on the twentieth day of
December, 1995.
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
(SEAL)
Attest /s/ PAUL M. KIERIG By: /s/ MICHAEL J. VELOTTA
------------------------- -------------------------------
Paul M. Kierig Michael J. Velotta
Assistant Secretary and Vice President, Secretary and
Assistant General Counsel General Counsel
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, this Registration Statement has been signed
below by the following Directors and Officers of Allstate Life Insurance Company
of New York on this twentieth day of December, 1995.
*/LOUIS G. LOWER, II Chairman of the Board and President
- - ------------------------- (Principal Executive Officer)
Louis G. Lower, II
/s/MICHAEL J. VELOTTA Director, Vice President, Secretary and
- - ------------------------- General Counsel
Michael J. Velotta
*/JAMES J. BRAZDA Director and Chief Administrative Officer
- - -------------------------
James J. Brazda
*/PETER H. HECKMAN Director and Vice President
- - -------------------------
Peter H. Heckman
*/TIMOTHY H. PLOHG Director and Vice President
- - -------------------------
Timothy H. Plohg
*/MARCIA D. ALAZRAKI Director */PHILLIP E. LAWSON Director
- - ------------------------- -------------------
Marcia D. Alazraki Phillip E. Lawson
*/JOSEPH MCFADDEN Director */GERARD F. McDERMOTT Director
- - ------------------------- ---------------------
Joseph McFadden Gerard F. McDermott
*/JOSEPH F. CARLINO Director */JOHN R. RABEN, JR. Director
- - ------------------------- --------------------
Joseph F. Carlino John R. Raben, Jr.
*/SALLY A. SLACKE Director */THEODORE A. SCHNELL Director
- - ------------------------- ---------------------
Sally A. Slacke Theodore A. Schnell
<PAGE>
*/CLEVELAND JOHNSON, JR. Director
- - -------------------------
Cleveland Johnson, Jr.
*/JAMES P. ZILS Treasurer
- - -------------------------
James P. Zils
*/CASEY J. SYLLA Chief Investment Officer
- - -------------------------
Casey J. Sylla
*/BARRY S. PAUL Assistant Vice President and Controller
- - -------------------------
Barry S. Paul
*/ By Michael J. Velotta, pursuant to Power of Attorney
<PAGE>
PART C
OTHER INFORMATION
24A. FINANCIAL STATEMENTS
PART A: Allstate Life Insurance Company of New York Financial Statements
and Financial Statement Schedules will be filed by pre-effective amendment.
The financial statements of Allstate Life Insurance Company of
New York Separate Account A are not included herein because, as of the date
hereof, the Variable Account had not yet commenced operations, had no assets or
liabilities and received no income. The financial statements of the Variable
Account will be audited on an annual basis once the Variable Account commences
operations.
24B. EXHIBITS
The following exhibits:
The following exhibits correspond to those required by paragraph (b) of
item 24 as to exhibits in Form N-4:
(1) Form of Resolution of the Board of Directors of Allstate Life
Insurance Company of New York authorizing establishment of the
Allstate Life Insurance Company of New York Separate Account A.
(2) Not Applicable.
(3) Form of Underwriting Agreement
(4) Specimen Contract
(5) Form of application for a Contract*
(6) (a) Certificate of Incorporation of Allstate Life Insurance Company
of New York.*
(b) By-laws of Allstate Life Insurance Company of New York.*
(7) Reinsurance Agreement*
(8) Form of Participation Agreement*
(9) Opinion and Consent of Michael J. Velotta, Vice President, Secretary*
and General Counsel of Allstate Life Insurance Company of New York.
(10) (a) Consent of Accountants*
(b) Consent of Attorneys*
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
<PAGE>
(14) Financial Data Schedule*
(99) Powers of Attorney.
- - ---------------
* To be filed by pre-effective amendment
<PAGE>
25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
Name and Principal Position and Office With Depositor
Business Address of the Trust
- - ---------------- ------------
Louis G. Lower, II Chairman of the Board and Chief Executive Officer
Michael J. Velotta Vice President, Secretary, General Counsel
and Director
James J. Brazda Chief Administrative Officer and Director
Peter H. Heckman Vice President and Director
Timothy H. Plohg Vice President and Director
Marcia D. Alazraki Director
Joseph F. Carlino Director
Cleveland Johnson, Jr. Director
Phillip E. Lawson Director
Gerard F. McDermott Director
Joseph P. McFadden Director
John R. Raben, Jr. Director
Sally A. Slacke Director
James P. Zils Treasurer
Dorothy E. Even Assistant Vice President
Judith P. Greffin Assistant Vice President
Mark A. Bishop Assistant Treasurer
Barbara S. Brown Assistant Treasurer
David M. Crew Assistant Treasurer
Anthony D. Frook Assistant Treasurer
Stephanie L. Holowach Assistant Treasurer
Peter S. Horos Assistant Treasurer
Thomas C. Jensen Assistant Treasurer
Robert T. Jostes Assistant Treasurer
Emma M. Klaidjian Assistant Secretary
Margarita Kellen Assistant Vice President
Paul N. Kierig Assistant Secretary and Assistant General Counsel
Kenneth S. Klimala Assistant Treasurer
Steven M. Laude Assistant Treasurer
Mary J. McGinn Assistant Secretary
Barry S. Paul Assistant Vice President and Controller
Robert N. Roeters Assistant Vice President
Theodore A. Schnell Assistant Vice President and Director
Mark D. Senkpiel Assistant Treasurer
Kevin R. Slawin Assistant Treasurer
C. Nelson Strom Assistant Vice President and Corporate Actuary
William F. Wein Assistant Treasurer
Patricia A. Wilson Assistant Vice President
The principal business address of the foregoing officers and directors is 3100
Sanders Road, Northbrook, IL 60062
26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH DEPOSITOR OR
REGISTRANT
See 10-K Commission File #1-11840, The Allstate Corporation.
27. NUMBER OF CONTRACT OWNERS
Not Applicable
<PAGE>
28. INDEMNIFICATION
The by-laws of both Allstate Life Insurance Company of New York (Depositor)
and Allstate Life Financial Services, Inc. (Distributor), provide for the
indemnification of its Directors, Officers and Controlling Persons, against
expenses, judgments, fines and amounts paid in settlement as incurred by such
person, if such person acted properly. No indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable for negligence or misconduct in the performance of a duty
to the Company, unless a court determines such person is entitled to such
indemnity.
Insofar as indemnification for liability arising out of the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than payment by the registrant
of expenses incurred by a director, officer or controlling person of the
registrant in the successful defense of any action, suit, or proceeding) is
asserted such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.
29a. RELATIONSHIP OF PRINCIPAL UNDERWRITER TO OTHER INVESTMENT COMPANIES
- Glenbrook Life and Annuity Company Separate Account A
- Glenbrook Life and Annuity Company Variable Annuity Account
<PAGE>
29b. PRINCIPAL UNDERWRITER
Name and Principal Business Allstate Life Financial
Address Of Each Such Person Services, Inc. ("ALFS")
---------------------------------------------------------------------------
Louis G. Lower, II Director
Marla G, Friedman Director
Michael J. Velotta Director and Secretary
Robert J. Kelly President and Chief Executive
Officer
Diane Bellas Vice President and Controller
Andrea J. Schur Vice President
James P. Zils Treasurer
John R. Hedrick General Counsel and Assistant
Secretary
Lisa A. Burnell Assistant Vice President
and Compliance Officer
Robert N. Roeters Assistant Vice President
Emma M. Kalaidjian Assistant Secretary
Paul N. Kierig Assistant Secretary
Kevin R. Slawin Assistant Treasurer
The principal address of ALFS is 3100 Sanders Road, Northbrook, Illinois
29c. COMPENSATION OF ALLSTATE LIFE FINANCIAL SERVICES, INC.
None
30. LOCATION OF ACCOUNTS AND RECORDS
The Depositor, Allstate Life Insurance Company of New York, is located at
One Allstate Drive, Farmington, New York, 11783.
The Underwriter, Allstate Life Financial Services, Inc., is located at 3100
Sanders Road, Northbrook, Illinois 60062.
Each company maintains those accounts and records required to be maintained
pursuant to Section 31(a) of the Investment Company Act and the rules
promulgated thereunder.
<PAGE>
31. MANAGEMENT SERVICES
None
32. UNDERTAKINGS
The Registrant promises to file a post-effective amendment to this
Registration Statement as frequently as is necessary to ensure that the audited
financial statements in the Registration Statement are never more than 16 months
old for so long as payments under the variable annuity contracts may be
accepted. Registrant furthermore agrees to include either as part of any
application to purchase a contract offered by the prospectus, a space that an
applicant can check to request a statement of Additional Information or a post
card or similar written communication affixed to or included in the Prospectus
that the applicant can remove to send for a Statement of Additional Information.
Finally the Registrant agrees to deliver any Statement of Additional Information
and any Financial Statements required to be made available under this Form N-4
promptly upon written or oral request.
33. REPRESENTATIONS PURSUANT TO SECTION 403(b) OF THE INTERNAL REVENUE CODE
The Company represents that it is relying upon a November 28, 1988
Securities and Exchange Commission no-action letter issued to the American
Council of Life Insurance ("ACLI") and that the provisions of paragraphs 1-4 of
the no-action letter have been complied with.
<PAGE>
EXHIBIT NO. (1)
FORM OF RESOLUTION OF BOARD OF DIRECTORS
<PAGE>
RESOLUTION OF THE DIRECTORS OF ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK
ESTABLISHING THE ALLSTATE LIFE OF NEW YORK SEPARATE ACCOUNT A
BE IT RESOLVED, that the Company, pursuant to the provisions of Section
4240 of the New York Insurance Code, hereby establishes a separate account
designated as the Allstate Life of New York Separate Account A ("hereinafter
Separate Account A") for the following use and purposes, and subject to such
conditions as hereinafter set forth.
BE IT FURTHER RESOLVED, that Separate Account A shall be established for
the purpose of providing for the issuance by the Company of flexible premium
deferred variable annuity contracts with market value adjustment features or
such other contracts ("Contracts") as the President or a designated officer may
designate for such purpose and shall constitute a separate account into which
are allocated amounts paid to or held by the Company under such Contracts; and
BE IT FURTHER RESOLVED, that the income, gains and losses, whether or not
realized, from assets allocated to Separate Account A, in accordance with the
Contracts, will be credited to or charged against such account without regard to
other income, gains or losses of the Company; and
BE IT FURTHER RESOLVED, that multiple sub-account investment divisions be,
and hereby are, established within Separate Account A to which net payments
under the Contracts will be allocated in accordance with the terms of the
Contracts issued, and that the President or a designated officer be, and hereby
is, authorized to increase or decrease the number of investment divisions as
deemed necessary or appropriate; and
BE IT FURTHER RESOLVED, that the President or a designated officer and
Treasurer be, and they hereby are, authorized to deposit such amount in Separate
Account A or in each investment division thereof as may be necessary or
appropriate to facilitate the commencement of the Account's operations; and
BE IT FURTHER RESOLVED, that the President of the Company or a designated
officer be, and is hereby, authorized to change the designation of Separate
Account A to such other designation as it may deem necessary or appropriate;
and
BE IT FURTHER RESOLVED, that the appropriate officers of the Company, be,
and they hereby are, authorized on behalf of Separate Account A and on behalf of
the Company to take any and all action that they may deem necessary or advisable
in order to sell the Contracts, including any filings and qualifications of the
Company, its officers, agents and employees, and the Contracts under the
insurance laws of any of the states of the United States of America or other
jurisdictions, and in connection therewith, to prepare, execute, deliver and
file all such applications, reports, covenants, resolutions, applications for
exemptions, consents to service of process and other papers and instruments as
may be required under such laws, and to take any and all further action which
said officers or counsel of the Company may deem necessary or desirable
(including entering into whatever agreements and contracts may be necessary) in
order to maintain such qualifications for as long as said officers or counsel
<PAGE>
deem them to be in the best interests of Separate Account A and the Company;
and
BE IT FURTHER RESOLVED, that the appropriate officers of the Company, with
such assistance from the Company's auditors, legal counsel and independent
consultants or others as they may require, be, and they hereby are, authorized
and directed to take all action necessary to: (a) register Separate Account A
as a unit investment trust under the Investment Company Act of 1940, as amended;
(b) register the Contracts in such amounts, which may be an indefinite amount,
as the officers of the Company shall from time to time deem appropriate under
the Securities Act of 1933; and (c) take all other actions which are necessary
in connection with the offering of said Contracts for sale and the operation of
Separate Account A in order to comply with the Investment Company Act of 1940,
the Securities Exchange Act of 1934, the Securities Act of 1933, and other
applicable federal laws, including the filing of any amendments to registration
statements, any undertakings, and any applications for exemptions from the
Investment Company Act of 1940 or other applicable federal laws as the officers
of the Company shall deem necessary or appropriate; and
BE IT FURTHER RESOLVED, that the President and the General Counsel, and
either of them with full power to act without the other, hereby are severally
authorized and empowered to prepare, execute and cause to be filed with the
Securities and Exchange Commission on behalf of Separate Account A and by the
Company as sponsor and depositor, a Form of Notification of Registration on Form
N-8A, a Registration Statement registering Separate Account A as an investment
company under the Investment Company Act of 1940, and a Registration Statement
under the Securities Act of 1933; and
BE IT FURTHER RESOLVED, that the President of the Company or a designated
officer is hereby authorized to execute agreements, on such terms and subject to
such modifications as deemed necessary, with qualified banks or other qualified
entities to provide administrative and/or custodial services in connection with
the establishment and maintenance of Separate Account A; and
BE IT FURTHER RESOLVED, that since it is expected that Separate Account A
will invest in securities issued by one or more investment companies, the
appropriate officers of the Company are hereby authorized to execute whatever
agreement or agreements as may be necessary or appropriate to enable such
investments to be made; and
BE IT FURTHER RESOLVED, that the appropriate officers of the Company, and
each of them, are hereby authorized to execute and deliver all such documents
and papers and to do or cause to be done all such acts and things as they may
deem necessary or desirable to carry out the foregoing resolutions and the
intent and purposes thereof.
<PAGE>
EXHIBIT NO. (4)
SPECIMEN CONTRACT
<PAGE>
- - -------------------------------------------------------------------------------
THE PERSONS INVOLVED
- - -------------------------------------------------------------------------------
OWNER. The person named at the time of application is the owner of this
Certificate unless subsequently changed. As owner, you will receive any
periodic income payments, unless you have directed us to pay them to someone
else.
You may exercise all rights stated in this Certificate, subject to the rights of
any irrevocable beneficiary.
You may change the owner or beneficiary at any time. If the owner is a natural
person, you may change the annuitant prior to the Payout Start Date. Once we
have received a satisfactory written request for an owner, beneficiary or
annuitant change, the change will take effect as of the date you signed it. We
are not liable for any payment we make or other action we take before receiving
any written request for a change from you.
You may not assign an interest in this Certificate as collateral or security for
a loan. However, you may assign periodic income payments under this Certificate
prior to the Payout Start Date. We are bound by an assignment only if it is
signed by the assignor and filed with us. We are not responsible for the
validity of an assignment.
If the sole surviving owner dies prior to the Payout Start Date, the beneficiary
becomes the new owner. If the sole surviving owner dies after the Payout Start
Date, the beneficiary becomes the new owner and will receive any subsequent
guaranteed income payments.
If more than one person is designated as owner:
- - - owner as used in this certificate refers to all people named as
owners, unless otherwise indicated;
- - - any request to exercise ownership rights must be signed by all owners;
and
- - - on the death of any person who is an owner, the surviving person(s)
named as owner will continue as owner.
ANNUITANT. The annuitant is the person named on the Annuity Data Page, but may
be changed by the owner, as described above. The annuitant must be a natural
person. If the annuitant dies prior to the Payout Start Date, the new annuitant
will be:
- - - the youngest owner; otherwise,
- - - the youngest beneficiary.
BENEFICIARY. The beneficiary is the person(s) named on the Annuity
Data Page, but may be changed by the owner, as described above. We will
determine the beneficiary from the most recent written request we have
received from you. If you do not name a beneficiary or if the beneficiary named
is no longer living, the beneficiary will be:
- - - your spouse if living; otherwise
- - - your children equally if living; otherwise
- - - your estate.
The beneficiary may become the owner under the circumstances described above.
The beneficiary may assign benefits under the Certificate, as described above,
once they are payable to the beneficiary. We are bound by an assignment only if
it is signed by the assignor and filed with us. We are not responsible for the
validity of an assignment.
Page 4
<PAGE>
- - -------------------------------------------------------------------------------
ACCUMULATION PHASE
- - -------------------------------------------------------------------------------
ACCUMULATION PHASE DEFINED. The "Accumulation Phase" is the first of two phases
during your Certificate. The Accumulation Phase begins on the issue date
stated on the Annuity Data Page. This phase will continue until the Payout
Start Date unless the Certificate is terminated before that date.
CERTIFICATE YEAR. The one year period beginning on the issue date and on
each anniversary of the
issue date.
PURCHASE PAYMENTS. You may make subsequent purchase payments during the
Accumulation Phase. The number of purchase payments is unlimited. The minimum
subsequent purchase payment amount is $500. We reserve the right to reduce the
minimum purchase payment. We may limit the maximum amount of purchase payments
we will accept.
We will invest the purchase payments in the Investment Alternatives you select.
You may allocate any portion of your purchase payment in whole percents from 0%
to 100% or in exact dollar amounts to any of the Investment Alternatives. The
total allocation must equal 100%. For each purchase payment, the minimum
amount that may be allocated to the Fixed Account is $500.
The allocation of the initial purchase payment is shown on the Annuity Data
Page. Allocation of each subsequent purchase payment will be the same as for
the most recent purchase payment unless you change the allocation. You may
change the allocation of subsequent purchase payments at any time, without
charge, simply by giving us written notice. Any change will be effective at the
time we receive the notice.
INVESTMENT ALTERNATIVES. Investment Alternatives are the Sub-accounts of the
Variable Account and the Sub-accounts of the Fixed Account shown on the Annuity
Data Page.
VARIABLE ACCOUNT. The "Variable Account" for this Certificate is the Glenbrook
Life and Annuity Company Separate Account A. This account is a separate
investment account to which we allocate assets contributed under this and
certain other certificates. These assets will not be
charged with liabilities arising from any other business we may have.
VARIABLE SUB-ACCOUNTS. The Variable Account is divided into Sub-accounts.
Each Sub-account invests solely in the shares of the mutual fund underlying
that Sub-account.
FIXED ACCOUNT. The Fixed Account is divided into Sub-accounts. A Sub-account
is identified by the Guarantee Period and the date the Guarantee Period begins.
You create a Sub-account when:
- - - you make a purchase payment; or
- - - you select a new Guarantee Period after the prior Sub-account expires; or
- - - you transfer an amount from an existing Sub-account of the Variable
Account or the Fixed Account.
A Sub-account continues until the end of the Guarantee Period.
You must select the Guarantee Period for all purchase payments and transfers
allocated to the Fixed Account. If you do not select a Guarantee Period for a
purchase payment or transfer, we will assign the same period(s) as used for the
most recent purchase payment. Guarantee Periods are offered at our discretion
and may range from on to ten years. We may change the Guarantee Periods
available for future purchase payments or transfers allocated to the Fixed
Account.
Page 5
<PAGE>
We will mail you a notice prior to the expiration of each Sub-account outlining
the options available at the end of a Guarantee Period. During the 30 day
period after a Guarantee Period expires you may:
- - - take no action and we will automatically renew the Sub-account value to a
Guarantee Period of the same duration to be established on the day the
previous Guarantee Period expired; or
- - - notify us to apply the Sub-account value to a new Guarantee Period(s) to be
established on the day the previous Guarantee Period expired; or
- - - notify us to apply the Sub-account value to any Sub-account of the Variable
Account on the day we receive the notification; or
- - - receive a portion of the Sub-account value or the entire Sub-account value
through a partial or full withdrawal that is not subject to a Market Value
Adjustment. In this case, the amount withdrawn will be deemed to have been
withdrawn on the day the Guarantee Period expired.
The minimum amount that can be allocated to a new Sub-account is $500.
CREDITING INTEREST. We credit interest daily to money allocated to the Fixed
Account at a rate which compounds over one year to the interest rate we
guaranteed when the money was allocated. We will credit interest to the initial
purchase payment from the issue date. We will credit interest to subsequent
purchase payments from the date we receive them. We will credit interest to
transfers from the date the transfer is made. The interest rates will never be
less than the minimum guaranteed rate shown on the Annuity Data Page.
TRANSFERS. Prior to the Payout Start Date, you may transfer amounts between
Investment Alternatives. You may make 12 transfers per Certificate Year without
charge. Each transfer after the 12th transfer in any Certificate Year may be
assessed a $10 transfer fee. Transfers are subject to the following
restrictions.
- - - The minimum amount that may be transferred into a Sub-account of the Fixed
Account is $500.
- - - Any transfer from a Sub-account of the Fixed Account at a time other than
during the 30 day period after a Guarantee Period expires will be subject
to a Market Value Adjustment.
- - - If any transfer reduces the value of a Sub-account of the Fixed Account to
less than $500, we will treat the request as a transfer of the entire Sub-
account value.
We reserve the right to waive the transfer fees and restrictions contained in
this Certificate.
CERTIFICATE VALUE. Your "Certificate Value" is equal to the sum of:
- - - the number of Accumulation Units you hold in each Sub-account of the
Variable Account multiplied by the Accumulation Unit Value for that Sub-
account on the most recent Valuation Date; plus
- - - the sum of Sub-account values in the Fixed Account.
ACCUMULATION UNITS AND ACCUMULATION UNIT VALUE. Amounts which you allocate to a
Sub-account of the Variable Account are used to purchase Accumulation
Units in that Sub-account. The Accumulation Unit Value for each Sub-account
at the end of any Valuation Period is calculated by multiplying the Accumulation
Unit Value at the end of the immediately preceding Valuation Period by the Sub-
account's Net Investment Factor for the Valuation Period. The Accumulation
Unit Values may go up or down. Additions or transfers to a Sub-account of the
Variable Account will increase the number of Accumulation Units for that Sub-
account. Withdrawals or transfers from a Sub-account of the Variable Account
will decrease the number of Accumulation Units for that Sub-account.
Page 6
<PAGE>
VALUATION PERIOD AND VALUATION DATE. A "Valuation Period" is the time interval
between the closing of the New York Stock Exchange on consecutive Valuation
Dates. A "Valuation Date" is any date the New York Stock Exchange is open for
trading.
NET INVESTMENT FACTOR. For each Sub-account of the Variable Account, the "Net
Investment Factor" for a Valuation Period is (A) divided by (B), minus (C)
where:
(A) is the sum of:
(1) the net asset value per share of the mutual fund underlying the
Sub-account determined at the end of the current Valuation
Period, plus
(2) the per share amount of any dividend or capital gain
distributions made by the mutual fund underlying the Sub-account
during the current Valuation Period.
(B) is the net asset value per share of the mutual fund underlying the Sub-
account determined as of the end of the immediately preceding Valuation
Period.
(C) is the sum of the annualized Administrative Expense Charge and the
annualized Mortality and Expense Risk Charge divided by 365 and then
multiplied by the number of calendar days in the current Valuation Period.
CHARGES. The charges for this Certificate include Administrative Expense
Charges, Mortality and Expense Risk Charges, Certificate Maintenance Charges,
transfer charges, and taxes. If withdrawals are made, the Certificate may also
be subject to Withdrawal Charges and Market Value Adjustments.
ADMINISTRATIVE EXPENSE CHARGE. The annualized Administrative Expense Charge
will never be greater than 0.10%. (See Net Investment Factor for a description
of how this charge is applied.)
MORTALITY AND EXPENSE RISK CHARGE. The annualized Mortality and Expense Risk
Charge will never be greater than 1.35%. (See Net Investment Factor for a
description of how this charge is applied.)
Our actual mortality and expense experience will not adversely affect the dollar
amount of variable benefits or other contractual payments or values under this
Certificate.
CERTIFICATE MAINTENANCE CHARGE. Prior to the Payout Start Date, a Certificate
Maintenance Charge will be deducted from your Certificate Value on each
certificate anniversary. The charge will be deducted on a pro-rata basis from
each Sub-account of the Variable Account in the proportion that your value in
each bears to your total value in all Sub-accounts of the Variable Account. A
full Certificate Maintenance Charge will be deducted if the Certificate is
terminated on any date other than a certificate anniversary. After the Payout
Start Date the Certificate Maintenance Charge will be deducted in equal parts
from each income payment. The annualized charge will never be greater than $35
per certificate year. The Certificate Maintenance Charge will be waived if
total purchase payments are $50,000 or more or if all money is allocated to the
Fixed Account on the certificate anniversary.
TAXES. Any premium tax or income tax withholding relating to this Certificate
may be deducted from purchase payments or the Certificate Value when the tax is
incurred or at a later time.
WITHDRAWAL. You have the right to withdraw part or all of your Certificate
Value at any time during the Accumulation Phase. A withdrawal must be at least
$50. If any withdrawal reduces the value of any Sub-account of the Fixed
Account to less than $500, we will treat the request as a withdrawal of the
entire Sub-account value. If any withdrawal reduces the Certificate Value to
less than $1,000, we will treat the request as a withdrawal of the entire
Certificate Value. If you withdraw the entire Certificate Value, the
Certificate will terminate.
You must specify the Investment Alternative(s) from which you wish to make a
withdrawal. When you make a withdrawal, your Certificate Value will be reduced
by the amount paid to you and any applicable Withdrawal Charge, Market Value
Adjustment, and taxes. Any Withdrawal Charge will be waived on withdrawals
taken to satisfy IRS minimum distribution rules.
Page 7
<PAGE>
PREFERRED WITHDRAWAL AMOUNT. Each Certificate Year the Preferred Withdrawal
Amount is equal to 10% of the amount of purchase payments. Each Certificate
Year you may withdraw the Preferred Withdrawal Amount without any Withdrawal
Charge or Market Value Adjustment. Each Certificate Year begins on the
anniversary of the date the Certificate was established. Any Preferred
Withdrawal Amount which is not withdrawn in a year may not be carried over to
increase the Preferred Withdrawal Amount in a subsequent year.
WITHDRAWAL CHARGE. Withdrawals in excess of the Preferred Withdrawal Amount
will be subject to a Withdrawal Charge as follows:
Payment Year: 1 2 3 4 5 6 7 8 and Later
Percentage: 6% 6% 5% 5% 4% 4% 3% 0%
To determine the Withdrawal Charge, we assume that purchase payments are
withdrawn first, beginning with the oldest payment. When all purchase payments
have been withdrawn, additional withdrawals will not be assessed a Withdrawal
Charge.
For each purchase payment withdrawal, the "Payment Year" in the table is
measured from the date we received the purchase payment. The Withdrawal Charge
is determined by:
- - - multiplying the percentage corresponding to the Payment Year, times
- - - that part of each purchase payment withdrawal that is in excess of the
Preferred Withdrawal Amount, adjusted by a Market Value Adjustment.
MARKET VALUE ADJUSTMENT. Withdrawals in excess of the Preferred Withdrawal
Amount, transfers, death benefits, and amounts applied to an income plan from a
Sub-account of the Fixed Account other than during the 30 day period after a
Guarantee Period expires are subject to a Market Value Adjustment. A Market
Value Adjustment is an increase or decrease in the amount reflecting changes in
the level of interest rates since the Sub-account was established. As used in
this provision, "Treasury Rate" means the U. S. Treasury Note Constant Maturity
yield as reported in Federal Reserve Bulletin Release H.15. The Market Value
Adjustment is based on the following:
I = the Treasury Rate for a maturity equal to the Sub-account's
Guarantee Period for the week preceding the establishment of
the Sub-account;
N = the number of whole and partial years from the date we
receive the withdrawal, transfer, or death benefit request,
or from the Payout Start Date, to the end of the Sub-
account's Guarantee Period;
J = the Treasury Rate for a maturity of N years for the week
preceding the receipt of the withdrawal request, transfer
request, death benefit request, or Income Payment request.
If a Note with a maturity of N years is not available, a
weighted average will be used. If N is one year or less, J
will be the 1-year Treasury Rate.
An adjustment factor is determined from the following formula:
.9 x (I - J) x N
The amount subject to a Market Value Adjustment that is deducted from a Sub-
account of the Fixed Account is multiplied by the adjustment factor to determine
the amount of the Market Value Adjustment. The amount deducted from the Sub-
account includes the transfer amount or the amount we pay you, income tax we
withhold for you, the Withdrawal Charge, any applicable premium tax charge, and
the Market Value Adjustment.
Page 8
<PAGE>
DEATH OF OWNER OR ANNUITANT. A benefit may be paid to the owner determined
immediately after the death if, prior to the Payout Start Date:
- - - any owner dies; or
- - - the annuitant dies and the owner is not a natural person.
If the owner eligible to receive a benefit is not a natural person, the
owner may elect to receive the benefit in one or more distributions. Otherwise,
if the owner is a natural person, the owner may elect to receive a benefit
either in one or more distributions or by periodic payments through an Income
Plan.
A Death Benefit will be paid: 1) if the owner elects to receive the Death
Benefit distributed in a single payment within 180 days of the date of death,
and 2) if the Death Benefit is paid as of the day the value of the Death Benefit
is determined. Otherwise, the Settlement Value will be paid. In any event, the
entire value of the certificate must be distributed within five (5) years after
the date of death unless an Income Plan is elected or a surviving spouse
continues the certificate in accordance with the following provisions.
Payments from the Income Plan must begin within one year of the date of death
and must be payable throughout:
- - - the life of the owner; or
- - - a period not to exceed the life expectancy of the owner; or
- - - the life of the owner with payments guaranteed for a period not to exceed
the life expectancy of the owner.
If the surviving spouse of the deceased owner is the new owner, then the spouse
may elect one of the options listed above or may continue the Certificate in the
Accumulation Phase as if the death had not occurred. If the Certificate is
continued in the Accumulation Phase, the surviving spouse may make a single
withdrawal of any amount within one year of the date of death without incurring
a Withdrawal Charge. However, any applicable Market Value Adjustment,
determined as of the date of the withdrawal, will apply. Death of Owner or
Annuitant. A death benefit may be paid to the owner determined immediately
after the death if, prior to the Payout Start Date:
DEATH BENEFIT. Prior to the Payout Start Date, the death benefit is equal to
the greatest of:
- - - Certificate Value on the date we determine the death benefit; or
- - - the amount that would have been payable in the event of a full
withdrawal of the Certificate Value on the date we determine the death
benefit; or
- - - the Certificate Value on the Death Benefit Anniversary immediately
preceding the date we determine the death benefit adjusted by any purchase
payments, withdrawals and charges made between such Death Benefit
Anniversary and the date we determine the death benefit.
The first Death Benefit Anniversary is the issue date. Subsequent Death
Benefit Anniversaries are those certificate anniversaries that are
multiples of 7 Certificate Years, beginning with the 7th certificate
anniversary. For example, the issue date, 7th, and 14th certificate
anniversaries are the first three Death Benefit Anniversaries.
- - - the greatest of the Anniversary Values as of the date we determine the
death benefit. The Anniversary Value is equal to the Certificate
Value on a Certificate Anniversary, increased by purchase payments
made since that anniversary and reduced by the amount of any partial
withdrawals since that anniversary. Anniversary values will be
calculated for each Certificate anniversary prior to the earlier of:
a. the date we determine the death benefit, or
b. the oldest owner's or the annuitant's, if the owner is not a natural
person, attained age 75 or 5 years after the date the Certificate was
established, if later.
Page 9
<PAGE>
We will determine the value of the death benefit as of the end of the Valuation
Period during which we receive a complete request for payment of the death
benefit. A complete request includes due proof of death.
The Death Benefit will never be greater than the maximum death benefit allowed
by any non-forfeiture laws which govern the Certificate.
SETTLEMENT VALUE. The Settlement Value is the same amount that would be paid in
the event of withdrawal of the Certificate Value. We will calculate the
Settlement Value at the end of the Valuation Period coinciding with the
requested distribution date for payment or on the mandatory distribution date of
5 years after the date of death.
Page 10
<PAGE>
- - -------------------------------------------------------------------------------
PAYOUT PHASE
- - -------------------------------------------------------------------------------
PAYOUT PHASE DEFINED. The "Payout Phase" is the second of the two phases during
your Certificate. During this phase the Certificate Value adjusted by any
Market Value Adjustment and less any applicable taxes is applied to the Income
Plan you choose and is paid out as provided in that plan.
The Payout Phase begins on the Payout Start Date. It continues until we make
the last payment as provided by the Income Plan chosen.
PAYOUT START DATE. The "Payout Start Date" is the date the Certificate Value
adjusted by any Market Value Adjustment and less any applicable taxes is applied
to an Income Plan. The anticipated Payout Start Date is shown on the Annuity
Data Page. You may change the Payout Start Date by writing to us at least 30
days prior to this date.
The Payout Start Date must be on or before the annuitant's 85th birthday.
INCOME PLANS. An "Income Plan" is a series of payments on a scheduled basis to
you or to another person designated by you. The Certificate Value on the
Payout Start Date adjusted by any Market Value Adjustment and less any
applicable taxes, will be applied to your Income Plan choice from the following
list:
1. LIFE INCOME WITH GUARANTEED PAYMENTS. We will make payments for as long
as the annuitant lives. If the annuitant dies before the selected number
of guaranteed payments have been made, we will continue to pay the
remainder of the guaranteed payments.
2. JOINT AND SURVIVOR LIFE INCOME WITH GUARANTEED PAYMENTS. We will
make payments for as long as either the annuitant or joint
annuitant, named at the time of Income Plan selection, lives. If
both the annuitant and the joint annuitant die before the selected
number of guaranteed payments have been made, we will continue to pay
the remainder of the guaranteed payments.
3. GUARANTEED NUMBER OF PAYMENTS. We will make payments for a specified
number of months beginning on the Payout Start Date. These payments do not
depend on the annuitant's life. The number of months guaranteed may be
from 60 to 360.
We reserve the right to make available other Income Plans.
INCOME PAYMENTS. Income payment amounts may vary based on any Sub-account of
the Variable Account and/or may be fixed for the duration of the Income Plan.
The method of calculating the initial payment is different for the two accounts.
The Certificate Maintenance Charge will be deducted in equal payments from each
income payment. The Certificate Maintenance Charge will be waived if total
Purchase Payments are $50,000 or more.
VARIABLE AMOUNT INCOME PAYMENTS. The initial income payment based upon the
Variable Account is calculated by applying the portion of the Certificate Value
in the Variable Account on the Payout Start Date, less any applicable premium
tax, to the appropriate value from the Income Payment Table selected.
Subsequent income payments will vary depending upon the changes in the Annuity
Unit Values for the Sub-accounts upon which the income payments are based.
The portion of the initial income payment based upon a particular Variable Sub-
account is determined by applying the amount of the Certificate Value in that
Sub-account on the Payout Start Date, less any applicable premium tax, to the
appropriate value from the Income Payment Table. This portion of the initial
income payment is divided by the Annuity Unit Value on the Payout Start Date for
that Variable Sub-account to determine the number of Annuity Units from that
Sub-account which will be used to determine subsequent income payments. Unless
Annuity Transfers are made between Sub-accounts, each subsequent income payment
from that Sub-account will be that number of Annuity Units times the Annuity
Unit Value for the Sub-account for the Valuation Date on which the income
payment is made.
Page 11
<PAGE>
ANNUITY UNIT VALUE. The Annuity Unit Value for each Sub-account of the Variable
Account at the end of any Valuation Period is calculated by:
- multiplying the Annuity Unit Value at the end of the immediately
preceding Valuation Period by the Sub-account's Net Investment Factor
during the period; and then
- - - dividing the result by 1.000 plus the assumed investment rate for the
period. The assumed investment rate is an effective annual rate of 3%.
FIXED AMOUNT INCOME PAYMENTS. The income payment amount derived from any monies
allocated to Sub-accounts of the Fixed Account during the Accumulation Phase are
fixed for the duration of the Income Plan. The Fixed Amount Income Payment is
calculated by applying the portion of the Certificate Value in the Fixed Account
on the Payout Start Date, adjusted by any Market Value Adjustment and less any
applicable premium tax, to the greater of the appropriate value from the Income
Payment Table selected or such other value as we are offering at that time.
ANNUITY TRANSFERS. After the Payout Start Date, no transfers may be made from
the Fixed Amount Income Payment. Transfers between Sub-accounts of the Variable
Account, or from the Variable Amount Income Payment to the Fixed Amount Income
Payment may not be made for six months after the Payout Start Date. Annuity
Transfers may be made once every six months thereafter.
PAYOUT TERMS AND CONDITIONS. The income payments are subject to the following
terms and conditions:
- - - If the Certificate Value is less than $2,000, or not enough to
provide an initial payment of at least $20, we reserve the right to:
- change the payment frequency to make the payment at least $20; or
- terminate the Certificate and pay you the Certificate Value
adjusted by any Market Value Adjustment and less any
applicable taxes in a lump sum.
- - - If we do not receive a written choice of an Income Plan from you at
least 30 days before the Payout Start Date, the Income Plan will be
life income with guaranteed payments for 120 months.
- - - If you choose an Income Plan which depends on any person's life, we
may require:
- proof of age and sex before income payments begin; and
- proof that the annuitant or joint annuitant is still alive before we
make each payment.
- - - After the Payout Start Date, the Income Plan cannot be changed and
withdrawals cannot be made unless income payments are being made from
the Variable Account under Income Plan 3. You may terminate the
income payments being made from the Variable Account under Income Plan
3 at any time and withdraw their value, subject to Withdrawal Charges.
- - - If any owner dies during the Payout Phase, the remaining income
payments will be paid to the successor owner as scheduled.
Page 12
<PAGE>
- - -------------------------------------------------------------------------------
INCOME PAYMENT TABLES
- - -------------------------------------------------------------------------------
The initial income payment will be at least the amount based on the
adjusted age of the annuitant(s) and the tables below, less any federal income
taxes which are withheld. The adjusted age is the actual age on the Payout
Start Date reduced by one year for each six full years between January 1, 1983
and the Payout Start Date. Income payments for ages and guaranteed payment
periods not shown below will be determined on a basis consistent with that used
to determine those that are shown. The Income Payment Tables are based on 3.0%
interest and the 1983a Annuity Mortality Tables.
INCOME PLAN 1 - LIFE INCOME WITH GUARANTEED PAYMENTS FOR 120 MONTHS
<TABLE>
<CAPTION>
- - ----------------------------------------------------------------------------------
- - ----------------------------------------------------------------------------------
Monthly Income Payment for each $1,000 Applied to this Income Plan
- - ----------------------------------------------------------------------------------
Annuitant's Annuitant's Annuitant's
Age Male Female Age Male Female Age Male Female
- - ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
35 $3.43 $3.25 49 $4.15 $3.82 63 $5.52 $4.97
36 3.47 3.28 50 4.22 3.88 64 5.66 5.09
37 3.51 3.31 51 4.29 3.94 65 5.80 5.22
38 3.55 3.34 52 4.37 4.01 66 5.95 5.35
39 3.60 3.38 53 4.45 4.07 67 6.11 5.49
40 3.64 3.41 54 4.53 4.14 68 6.27 5.64
41 3.69 3.45 55 4.62 4.22 69 6.44 5.80
42 3.74 3.49 56 4.71 4.29 70 6.61 5.96
43 3.79 3.53 57 4.81 4.38 71 6.78 6.13
44 3.84 3.58 58 4.92 4.46 72 6.96 6.31
45 3.90 3.62 59 5.02 4.55 73 7.13 6.50
46 3.96 3.67 60 5.14 4.65 74 7.31 6.69
47 4.02 3.72 61 5.26 4.75 75 7.49 6.88
48 4.08 3.77 62 5.39 4.86
</TABLE>
INCOME PLAN 2 - JOINT AND SURVIVOR LIFE INCOME WITH GUARANTEED PAYMENTS FOR 120
MONTHS
<TABLE>
<CAPTION>
- - -----------------------------------------------------------------------------------------------------------
- - -----------------------------------------------------------------------------------------------------------
Monthly Income Payment for each $1,000 Applied to this Income Plan
- - -----------------------------------------------------------------------------------------------------------
Female Annuitant's Age
Male -----------------------------------------------------------------------------------------
Annuitant's 35 40 45 50 55 60 65 70 75
Age
- - -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
35 $3.09 $3.16 $3.23 $3.28 $3.32 $3.36 $3.39 $3.40 $3.42
40 3.13 3.22 3.31 3.39 3.46 3.51 3.56 3.59 3.61
45 3.17 3.28 3.39 3.50 3.60 3.69 3.76 3.81 3.85
50 3.19 3.32 3.45 3.60 3.74 3.87 3.98 4.07 4.14
55 3.21 3.35 3.51 3.68 3.87 4.06 4.23 4.37 4.48
60 3.23 3.37 3.55 3.75 3.98 4.23 4.47 4.70 4.88
65 3.24 3.39 3.57 3.80 4.07 4.37 4.71 5.04 5.34
70 3.24 3.40 3.59 3.83 4.13 4.48 4.90 5.36 5.81
75 3.25 3.41 3.61 3.86 4.17 4.56 5.04 5.61 6.22
- - -----------------------------------------------------------------------------------------------------------
</TABLE>
INCOME PLAN 3 - GUARANTEED NUMBER OF PAYMENTS
- - ---------------------------------------------------------------
- - ---------------------------------------------------------------
<TABLE>
<CAPTION>
Monthly Income Payment for each
Specified Period $1,000 Applied to this Income Plan
- - ---------------------------------------------------------------
<S> <C>
10 Years $9.61
11 Years 8.86
12 Years 8.24
13 Years 7.71
14 Years 7.26
15 Years 6.87
16 Years 6.53
17 Years 6.23
18 Years 5.96
19 Years 5.73
20 Years 5.51
</TABLE>
Page 13
<PAGE>
- - -------------------------------------------------------------------------------
GENERAL PROVISIONS
- - -------------------------------------------------------------------------------
THE ENTIRE CONTRACT. The entire contract consists of the Master Policy,
the Master Policy application, and any written enrollments, any endorsements,
and any riders.
All statements made in written enrollments are representations and not
warranties. No statement will be used by us in defense of a claim or to void
the Certificate unless it is included in a written enrollment.
Only our officers may, in order to conform to any state or federal law, change
the Master Policy or Certificate or waive a right or requirement. No other
individual may do this.
MASTER POLICYHOLDER The Master Policyholder may be amended by us, terminated by
us, or terminated by the Master Policyholder without the consent of any other
person. No termination completed after the issue date of this Certificate will
adversely affect your rights under this Certificate.
We may not modify this Certificate without your consent, except to
make it comply with any changes in the Internal Revenue Code or as required
by any other applicable law.
INCONTESTABILITY. We will not contest the validity of this Certificate after
the issue date.
MISSTATEMENT OF AGE OR SEX. If any age or sex has been misstated,
we will pay the amounts which would have been paid at the correct age and sex.
If we find the misstatement of age or sex after the income payments begin, we
will:
- - - pay all amounts underpaid including interest; or
- - - stop payments until the total payments are equal to the corrected amount.
For purposes of the Misstatement of Age or Sex provision, interest will be
calculated at an effective annual rate of 6%.
ANNUAL STATEMENT. At least once a year, prior to the Payout Start Date, we will
send you a statement containing Certificate Value information. We will provide
you with Certificate Value information at any time upon request. The
information presented will comply with any applicable law.
SETTLEMENTS. We may require that this Certificate be returned to us prior to
any settlement. We must receive due proof of death of the owner or annuitant
prior to settlement of a death claim. Due proof of death is one of the
following:
- - - a certified copy of a death certificate; or
- - - a certified copy of a decree of a court of competent jurisdiction as to a
finding of death; or
- - - any other proof acceptable to us.
Any full withdrawal or death benefit under this Certificate will not be less
than the minimum benefits required by any statute of the state in which the
Certificate is delivered.
DEFERMENT OF PAYMENTS. We will pay any amounts due from the Variable Account
under this Certificate within seven days, unless:
- - - the New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on such Exchange is restricted;
- - - an emergency exists as defined by the Securities and Exchange Commission;
or
- - - the Securities and Exchange Commission permits delay for the protection of
Certificate holders.
Page 14
<PAGE>
We reserve the right to postpone payments or transfers from the Fixed Account
for up to six months. If we elect to postpone payments or transfers from the
Fixed Account for 30 days or more, we will pay interest as required by
applicable law. Any interest would be payable from the date the withdrawal
request is received by us to the date the payment or transfer is made.
VARIABLE ACCOUNT MODIFICATIONS. We reserve the right, subject to applicable
law, to make additions to, deletions from, or substitutions for the mutual fund
shares underlying the Sub-accounts of the Variable Account. We will not
substitute any shares attributable to your interest in a Sub-account of the
Variable Account without notice to you and prior approval of the Securities and
Exchange Commission, to the extent required by the Investment Company Act of
1940.
We reserve the right to establish additional Sub-accounts of the Variable
Account, each of which would invest in shares of another mutual fund. You may
then instruct us to allocate purchase payments or transfers to such Sub-
accounts, subject to any terms set by us or the mutual fund.
In the event of any such substitution or change, we may by endorsement, make
such changes as may be necessary or appropriate to reflect such substitution or
change.
If we deem it to be in the best interests of persons having voting rights under
the certificates, the Variable Account may be operated as a management company
under the Investment Company Act of 1940 or it may be deregistered under such
Act in the event such registration is no longer required.
Page 15
<PAGE>
POWERS OF ATTORNEY
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Marcia D. Alazraki, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, her attorneys-in-fact, with power of substitution,
and her in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or her
substitute or substitutes, may do or cause to be done by virtue hereof.
July 24,1995
----------------------
Date
/s/ MARCIA D. ALAZRAKI
----------------------
Marcia D. Alazraki
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Joseph F. Carlino, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
August 2, 1995
------------------------------
Date
/s/ JOSEPH F. CARLINO
------------------------------
Joseph F. Carlino
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that James J. Brazda, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 14,1995
-----------------------------------
Date
/s/ JAMES J. BRAZDA
------------------------------------
James J. Brazda
Chief Administrative Officer
and Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Peter H. Heckman, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 17, 1995
-----------------------------------
Date
/s/ PETER H. HECKMAN
-----------------------------------
Peter H. Heckman
Vice President and Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Phillip E. Lawson, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 14, 1995
-----------------------------------
Date
/s/ PHILLIP E. LAWSON
-----------------------------------
Phillip E. Lawson
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Cleveland Johnson, Jr., whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 15, 1995
-----------------------------------
Date
/s/ CLEVELAND JOHNSON, JR.
-----------------------------------
Cleveland Johnson, Jr.
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Louis G. Lower, II, whose signature
appears below, constitutes and appoints Michael J. Velotta, his attorney-in-
fact, with power of substitution, and his in any and all capacities, to sign any
Form N-4 registration statements and amendments thereto for the Allstate Life of
New York Separate Accoun A Contract and to file the same, with exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each of said attorneys-in-
fact, or his substitute or substitutes, may do or cause to be done by virtue
hereof.
July 18, 1995
-----------------------------------
Date
/s/ LOUIS G. LOWER, II
-----------------------------------
Louis G. Lower, II
Chairman of the Board, President
and Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Joseph P. McFadden, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 14, 1995
-------------
Date
/s/ JOSEPH P. MCFADDEN
-----------------------------------
Joseph P. McFadden
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Gerard F. McDermott, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, his attorneys-in-fact, with power of substitution, and each of them in
any and all capacities, to sign any Form N-4 registration statements and
amendments thereto for the Allstate Life of New York Separate Account A Contract
and to file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
December 19, 1995
-----------------
Date
/s/ GERARD F. MCDERMOTT
-----------------------------------
Gerard F. McDermott
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Barry S. Paul, whose signature appears
below, constitutes and appoints Louis G. Lower, II, and Michael J. Velotta, and
each of them, his attorneys-in-fact, with power of substitution, and him in any
and all capacities, to sign any Form N-4 registration statements and amendments
thereto for the Allstate Life of New York Separate Account A Contract and to
file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
July 20, 1995
-------------
Date
/s/ BARRY S. PAUL
-----------------------------------
Barry S. Paul
Assistant Vice President and Controller
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Timothy H. Plohg, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
December 19, 1995
-----------------
Date
/s/ TIMOTHY H. PLOHG
-----------------------------------
Timothy H. Plohg
Vice President and Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that John R. Raben, Jr., whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
July 14, 1995
-----------------------------------
Date
/s/ JOHN R. RABEN, JR.
-----------------------------------
John R. Raben, Jr.
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Casey J. Sylla, whose signature appears
below, constitutes and appoints Louis G. Lower, II, and Michael J. Velotta, his
attorneys-in-fact, with power of substitution, and each of them in any and all
capacities, to sign any Form N-4 registration statements and amendments thereto
for the Allstate Life of New York Separate Account A Contract and to file the
same, with exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorneys-in-fact, or his substitute or substitutes, may do or
cause to be done by virtue hereof.
December 19, 1995
-----------------------------------
Date
/s/ CASEY J. SYLLA
-----------------------------------
Casey J. Sylla
Chief Investment Officer
and Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Sally A. Slacke, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, her attorneys-in-fact, with power of substitution,
and her in any and all capacities, to sign any N-4 registration statements and
amendments thereto for the Allstate Life of New York Market Value Adjusted
Annuity Contract and to file the same, with exhibits thereto and other documents
in connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or her
substitute or substitutes, may do or cause to be done by virtue hereof.
December 19, 1995
-----------------------------------
Date
/s/ SALLY A. SLACKE
-----------------------------------
Sally A. Slacke
Director
Allstate Life Insurance Company
of New York
<PAGE>
POWER OF ATTORNEY
WITH RESPECT TO THE ALLSTATE LIFE OF NEW YORK
SEPARATE ACCOUNT A CONTRACT
Know all men by these presents that Theodore A. Schnell, whose signature
appears below, constitutes and appoints Louis G. Lower, II, and Michael J.
Velotta, and each of them, his attorneys-in-fact, with power of substitution,
and him in any and all capacities, to sign any Form N-4 registration statements
and amendments thereto for the Allstate Life of New York Separate Account A
Contract and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
December 20, 1995
-----------------------------------
Date
/s/ THEODORE A. SCHNELL
-----------------------------------
Theodore A. Schnell
Assistant Vice President and Director
Allstate Life Insurance Company
of New York
