<PAGE>
[LETTERHEAD OF CANADA LIFE INSURANCE COMPANY OF AMERICA APPEARS HERE]
March 1999
Dear VariFund(R) Policyowner:
Please find enclosed the Annual Reports for the Canada Life of America Series
Fund, the Fidelity Investment Variable Insurance Products Fund, the Fidelity
Investments Variable Insurance Products Fund II, the Fidelity Investments
Variable Insurance Products Fund III, the Seligman Portfolios Inc., the Dreyfus
Variable Investment Fund, the Montgomery Variable Funds III , the Berger/BIAM
Fund and the Alger American Fund for the period ending December 31, 1998. We
encourage you to review this information and refer to it as needed throughout
the year.
Thank you for selecting VariFund for your financial needs.
Sincerely,
/S/ Ronald E. Beettam
Ronald E. Beettam, President
Canada Life Insurance Company of America
<PAGE>
VARIFUND(R)
A Variable Annuity
[LETTERHEAD OF CANADA LIFE INSURANCE COMPANY OF AMERICA APPEARS HERE]
ADDITIONAL PREMIUM PAYMENT FORM
Please complete the following information:
OWNER: AMOUNT OF PREMIUM PAYMENT:
ANNUITANT:___________________ $____________
POLICY NO.:__________________
OWNER'S SSN/TIN:_____________ IF YOU ARE CHANGING ALLOCATION
PLEASE COMPLETE THE FOLLOWING:
-------- THIS PAYMENT ONLY
-------- THIS PAYMENT AND ALL FUTURE PYMTS
-------- RE-ALLOCATE ALL CURRENT ASSETS
<TABLE>
<S> <C> <C> <C> <C> <C>
CLASF INT'L EQUITY 10/30 ____% FIDELITY HIGH INCOME 18/38 ____% DREYFUS GROWTH & INC 80/90 ____%
CLASF MONEY MARKET 11/31 ____% FIDELITY INDEX 500 20/40 ____% DREYFUS SOCIAL RESPON 81/91 ____%
CLASF BOND 13/33 ____% ALGER GROWTH 83/93 ____% MONTGOMERY GROWTH 87/97 ____%
CLASF VALUE EQUITY 14/34 ____% ALGER LEVER ALLCAP 85/95 ____% SELIGMAN COMM & INFO 50/70 ____%
CLASF CAPITAL 15/35 ____% ALGER MIDCAP 84/94 ____% SELIGMAN FRONTIER 51/71 ____%
FIDELITY ASSET MGR 16/36 ____% ALGER SMALL CAP 82/92 ____%
FIDELITY CONTRAFUND 52/72 ____% BERGER/BIAM IPT INT'L 88/98 ____%
FIDELITY GROWTH 17/37 ____% BERGER/BIAM SM. CO GR 89/99 ____%
FIDELITY GROWTH OPPS 53/73 ____% DREYFUS CAP'L APPR. 46/47 ____%
</TABLE>
<TABLE>
<CAPTION>
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FIXED ACCOUNT OPTIONS*
<S> <C> <C> <C> <C>
____% 1 Yr. (301) ____% 3 Yr. (303) ____% 5 Yr. (305) ____% 7 Yr. (307) ____% 10 Yr. (310)
* The Fixed Accounts and/or the Guarantee Periods may not be available in all
states.
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</TABLE>
Total allocation must equal 100%
OWNER'S SIGNATURE ________________ DATE _______________
JOINT OWNER'S SIGNATURE ________________ DATE _______________
PLEASE MAKE CHECKS PAYABLE TO CANADA LIFE INSURANCE COMPANY OF AMERICA
INFORMATION FOR QUALIFIED POLICY CONTRIBUTIONS
(THIS SECTION MUST BE COMPLETED)
IS THIS A ROLLOVER? _____YES _____NO
IF YES, WHAT TYPE? _____________________ PLEASE NOTE: CONTRIBUTIONS FOR
PRIOR TAX YEAR
CANNOT BE MADE AFTER
CONTRIBUTION $___________ FOR __________ APRIL 15TH OF THE
CURRENT TAX YEAR.
CONTRIBUTION $___________ FOR __________
PLEASE DIRECT ANY QUESTIONS REGARDING YOUR POLICY TO YOUR REGISTERED
REPRESENTATIVE OR TO OUR VARIABLE ANNUITY DEPARTMENT AT (800) 905-1959.
OUR VARIABLE ANNUITY ADMINISTRATORS CAN NOT ADVISE YOU ON THE SUITABILITY OF
YOUR PAYMENT. PLEASE CONTACT YOUR REGISTERED REPRESENTATIVE TO DISCUSS
SUITABILITY ISSUES PRIOR TO SUBMITTING YOUR ADDITIONAL PREMIUM PAYMENT.
Variable Annuities are issued by Canada Life Insurance Company of America and
offered through its subsidiary,
Canada Life of America Financial Services, Inc. (member NASD).
<PAGE>
V A R I F U N D (TM) A N N U I T Y
================================ ==========================================
VARIABLE SUB-ACCOUNT PERFORMANCE AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS
ENDING DECEMBER 31, 1998 ASSUMING CONTRACT
CONTINUES
<TABLE>
<CAPTION>
PORTFOLIO TYPE PORTFOLIO ONE THREE FIVE TEN SINCE INCEPTION
YTD YEAR YEAR YEAR YEAR INCEPTION DATE
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
EQUITY PORTFOLIOS Alger American Growth 45.91% 45.91% 26.41% 22.11% N/A 20.28% 01/08/89
Alger American Leveraged AllCap 55.53% 55.53% 26.53% N/A N/A 37.36% 01/25/95
Alger American MidCap Growth 28.39% 28.39% 17.07% 17.27% N/A 21.73% 05/03/93
Alger American Small Capitalization 13.83% 13.83% 8.65% 11.45% 18.14% 17.16% 09/20/88
Berger Small Company Growth 0.38% 0.38% N/A N/A N/A 18.13% 05/01/96
CLASF Capital 18.42% 18.42% 16.15% 14.37% N/A 14.66% 04/23/93
CLASF Value Equity 1.26% 1.26% 10.15% 10.35% N/A 9.63% 12/04/89
Dreyfus Capital Appreciation 28.29% 28.29% 26.08% 21.78% N/A 19.79% 03/31/93
Dreyfus Growth & Income 10.17% 10.17% 14.35% N/A N/A 19.25% 05/02/94
Dreyfus Socially Responsible 27.49% 27.49% 24.46% 20.67% N/A 21.21% 10/07/93
Fidelity VIP II Contrafund 27.80% 27.80% 23.19% N/A N/A 26.72% 01/03/95
Fidelity VIP Growth 37.45% 37.45% 23.65% 19.97% 17.69% 15.67% 10/09/86
Montgomery Growth 1.41% 1.41% N/A N/A N/A 18.32% 02/09/96
Fidelity VIP II Index 500 26.44% 26.44% 26.03% 21.94% N/A 19.42% 08/27/92
Fidelity VIP III Growth Opportunities 22.62% 22.62% 22.33% N/A N/A 24.40% 01/03/95
Seligman Frontier (2.91)% (2.91)% 10.77% N/A N/A 16.08% 10/11/94
----------------------------------------------------------------------------------------------------------------
INTERNATIONAL Berger-IPT International 14.42% 14.42% N/A N/A N/A 6.47% 05/01/97
CLASF International Equity 11.69% 11.69% 10.52% N/A N/A 9.85% 04/24/95
Fidelity VIP Overseas 11.09% 11.09% 10.85% 8.07% 8.48% 7.01% 01/28/87
Montgomery Emerging Markets (38.47)% (38.47)% N/A N/A N/A (14.45)% 02/02/96
----------------------------------------------------------------------------------------------------------------
SPECIALTY PORTFOLIO Seligman Communications & Information 34.49% 34.49% 20.20% N/A N/A 23.70% 10/11/94
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BALANCED CLASF Managed 3.57% 3.57% 7.76% 8.12% N/A 8.28% 12/04/89
Fidelity VIP II Asset Manager 13.36% 13.36% 15.03% 10.16% N/A 11.34% 09/06/89
----------------------------------------------------------------------------------------------------------------
FIXED INCOME
PORTFOLIOS CLASF Bond 7.38% 7.38% 5.66% 5.15% N/A 6.40% 12/04/89
Fidelity VIP High Income (5.74)% (5.74)% 7.08% 7.20% 9.48% 9.49% 09/19/85
----------------------------------------------------------------------------------------------------------------
MONEY MARKET CLASF Money Market 3.25% 3.25% 3.25% 3.04% N/A 2.98% 12/04/89
</TABLE>
CLASF Money Market Portfolio current yield (annualized yield for a seven day
period ended December 31, 1998) is 4.38%. VariFund Fixed Account MVA 1 year rate
was 4.50% as of January 1, 1999. The performance data quoted is after the
deduction of all fees and charges, except for possible surrender charges. For
performance figures after the deduction of all fees and charges, including the
maximum possible surrender charge, please see the reverse side. Performance data
represents past performance and is not a guarantee of future results. Investment
returns and principal value may fluctuate so that an investor's shares, when
redeemed, may be more or less than his or her original cost. Performance figures
for portfolios with inception dates prior to December 4, 1989 reflect
performance if VariFund existed at the inception of those portfolios. Contact
you registered representative or call Canada Life Insurance Company of America
at (800) 905-1959 for a Prospectus containing full details including information
on fees and charges. Please read the prospectus carefully before investing or
spending money.
<PAGE>
VARIABLE SUB-ACCOUNT PERFORMANCE
--------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING DECEMBER 31, 1998 (R)
ASSUMING CONTRACT IS SURRENDERED AT END OF PERIOD
<TABLE>
<CAPTION>
PORTFOLIO TYPE PORTFOLIO ONE THREE FIVE TEN SINCE INCEPTION
YTD YEAR YEAR YEAR YEAR INCEPTION DATE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
EQUITY PORTFOLIOS Alger American Growth 40.51% 40.51% 25.46% 21.87% N/A 20.28% 01/08/89
Alger American Leveraged AllCap 50.13% 50.13% 25.58% N/A N/A 36.90% 01/25/95
Alger American MidCap Growth 22.99% 22.99% 15.97% 16.98% N/A 21.54% 05/03/93
Alger American Small Capitalization 8.43% 8.43% 7.37% 11.10% 18.14% 17.16% 09/20/88
Berger Small Company Growth (5.02)% (5.02)% N/A N/A N/A 13.63% 05/01/96
CLASF Capital 13.02% 13.02% 15.03% 14.05% N/A 14.41% 04/23/93
CLASF Value Equity (4.14)% (4.14)% 8.90% 9.98% N/A 9.63% 12/04/89
Dreyfus Capital Appreciation 22.89% 22.89% 25.13% 21.45% N/A 19.59% 03/31/93
Dreyfus Growth & Income 4.77% 4.77% 13.19% N/A N/A 18.85% 05/02/94
Dreyfus Socially Responsible 22.09% 22.09% 23.49% 20.33% N/A 20.98% 10/07/93
Fidelity VIP II Contrafund 22.40% 22.40% 22.19% N/A N/A 26.17% 01/03/95
Fidelity VIP Growth 32.05% 32.05% 22.66% 19.71% 17.69% 15.67% 10/09/86
Montgormery Growth (3.99)% (3.99)% N/A N/A N/A 17.18% 02/09/96
Fidelity VIP II Index 500 21.04% 21.04% 25.08% 21.70% N/A 19.31% 08/27/92
Fidelity VIP III Growth Opportunities 17.22% 17.22% 21.32% N/A N/A 23.81% 01/03/95
Seligman Frontier (8.31)% (8.31)% 9.53% N/A N/A 15.56% 10/11/94
----------------------------------------------------------------------------------------------------------------
INTERNATIONAL Berger-IPT International 9.02% 9.02% N/A N/A N/A 3.33% 05/01/97
CLASF International Equity 6.29% 6.29% 9.02% N/A N/A 8.89% 04/24/95
Fidelity VIP Overseas 5.69% 5.69% 9.62% 7.67% 8.48% 7.01% 01/28/87
Montgomery Emerging Markets (43.87)% (43.87)% N/A N/A N/A (16.58)% 02/02/96
----------------------------------------------------------------------------------------------------------------
SPECIALTY PORTFOLIO Seligman Communications & Information 29.09% 29.09% 19.16% N/A N/A 23.28% 10/11/94
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BALANCED CLASF Managed (1.83)% (1.83)% 6.45% 7.73% N/A 8.28% 12/04/89
Fidelity VIP II Assets Manager 7.96% 7.96% 13.88% 9.79% N/A 11.26% 09/06/89
----------------------------------------------------------------------------------------------------------------
FIXED INCOME
PORTFOLIOS CLASF Bond 1.98% 1.98% 4.29% 4.71% N/A 6.40% 12/04/89
Fidelity VIP High Income (11.14)% (11.14)% 5.76% 6.79% 9.48% 9.49% 09/19/85
----------------------------------------------------------------------------------------------------------------
MONEY MARKET CLASF Money Market (2.15)% (2.15)% 1.82% 2.56% N/A 2.98% 12/04/89
</TABLE>
The above figures are SEC required "standardized" performance returns which
include the deduction of all fees and charges, including the maximum possible
sales charge. These figures may not be applicable to your contract, since you
may not have to pay these early withdrawal charges. Please see the prospectus
for more details. CLASF refers to Canada Life of America Series Fund, Inc.
Fidelity VIP and Fidelity VIP II refer to Fidelity Investments Variable
Insurance Products Fund and Fidelity Variable Insurance Products Fund II.
Annuities are not deposits of, obligations of, or guaranteed by any depositary
institution. They are not insured by FDIC or any federal agency, and as such are
subject to investment risk including possible loss of principal invested. The
FIXED account portions of a variable annuity (NOT the separate accounts) are
backed by the issuing insurance company.
Issued By: Canada Life Insurance Company of America, 6201 Powers Ferry Road,
N.W. Atlanta, GA 30339
Distributed By: Canada Life of America Financial Services, Inc. 6201 Powers
Ferry Road, N.W., Atlanta, GA 30339
<PAGE>
The attached are incorporated by reference herein to the annual reports filed by
and on behalf of the following:
The Alger American Fund, filed February 23, 1999
Portfolios which include: Alger American Small Capitalization; Alger
American Growth; Alger American MidCap Growth; and Alger American Leveraged
AllCap
Berger Institutional Products Trust, filed February 22, 1999
Portfolios which include: Berger/BIAM IPT-International Fund; and Berger
IPT-Small Company Growth
Canada Life of America Series Fund, Inc., filed March 1, 1999
Portfolios which include: Money Market; Managed; Bond; Value Equity,
International Equity; and Capital.
Dreyfus Variable Investment Fund, filed February 23, 1999
Portfolios which include: Dreyfus Growth and Income; and Dreyfus Capital
Appreciation
The Dreyfus Socially Responsible Growth Fund, Inc., filed February 23, 1999
Portfolios which include: Dreyfus Socially Responsible
Fidelity Investments Variable Insurance Products Fund, filed February 19, 1999
Portfolios which include: Fidelity VIP Growth, Fidelity VIP High Income and
Fidelity VIP Overseas
Fidelity Investments Variable Insurance Products Fund II, filed February 19,
1999
Portfolios which include: Fidelity VIP II Asset Manager; Fidelity VIP II
Index 500; and Fidelity VIP II Contrafund
Fidelity Investments Variable Insurance Products Fund III, filed February 19,
1999
Portfolios which include: Fidelity VIP III Growth Opportunities
Seligman Portfolios, Inc., filed March 4, 1999
Portfolios which include: Communications and Information; and Frontier
The Montgomery Funds III, filed February 25, 1999
Portfolios which include: Montgomery Variable Series Emerging Markets Fund;
and Montgomery Variable Series Growth Fund
