<PAGE>
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American Variable
Insurance Series(R)
Class 2 Shares
Prospectus
JULY 1, 1999
The Securities and Exchange Commission has not approved or disapproved of
these securities. Further, it has not determined that this prospectus is
truthful or complete. Any representation to the contrary is a criminal
offense.
<PAGE>
The Series consists of 11 funds, each representing a separate fully managed di-
versified portfolio of securities. The four funds available in Delaware-Lincoln
ChoicePlus are:
Global Small Capitalization Fund
Growth Fund
International Fund
Growth-Income Fund
The Series offers two classes of fund shares: Class 1 shares and Class 2
shares. This prospectus offers only Class 2 shares and is for use with Con-
tracts that make Class 2 shares available. The Board of Trustees may establish
additional funds and classes in the future. The investment objective(s) and
policies of each fund are discussed below. More information on the funds is
contained in the Series' statement of additional information.
Shares of the Series are currently offered only to separate accounts of various
insurance companies to serve as the underlying investment for both variable an-
nuity and variable life insurance contracts ("Contracts"). All such shares may
be purchased or redeemed by the separate accounts without any sales or redemp-
tion charges at net asset value. Due to differences in tax treatment or other
considerations, the interest of various Contract owners participating in a fund
might at some time be in conflict. The Board of Trustees will monitor the Se-
ries' operations for any material conflicts and determine what action, if any,
should be taken.
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American Variable Insurance Series / Prospectus 1
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<PAGE>
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Global Small Capitalization Fund
RISK/RETURN SUMMARY
The fund seeks to make your investment grow over time by investing primarily in
stocks of smaller companies located around the world that typically have market
capitalizations of $50 million to $1.2 billion. The fund is designed for in-
vestors seeking capital appreciation through stocks. Investors in the fund
should have a long-term perspective and be able to tolerate potentially wide
price fluctuations.
The prices of equity securities held by the fund may decline in response to
certain events, including those directly involving companies whose securities
are owned in the fund, adverse conditions affecting the general economy, over-
all market declines, world political, social and economic instability and cur-
rency fluctuations. Investments outside the U.S. may be affected by these
events to a greater extent and may also be affected by differing securities
regulations and administrative difficulties such as delays in clearing and set-
tling portfolio transactions. The growth oriented, equity-type securities gen-
erally purchased by the fund may involve large price swings and potential for
loss, particularly in the case of smaller capitalization stocks. In addition,
smaller capitalization stocks are often more difficult to value or dispose of,
more difficult to obtain information about, and more volatile than stocks of
larger, more established companies.
The fund relies on the professional judgment of its investment adviser, Capital
Research and Management Company, to make decisions about the fund's portfolio
securities. The basic investment philosophy of Capital Research and Management
Company is to seek undervalued securities that represent good long-term invest-
ment opportunities. Securities may be sold when they are judged to no longer
represent good long-term value.
You may lose money by investing in the fund. The likelihood of loss is greater
if you invest for a shorter period of time. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal Deposit Insur-
ance Corporation or any other government agency, entity or person.
Investment Results
The fund began operations on April 30, 1998. Accordingly, results for a full
calendar year are not available. The fund's year-to-date return for the three
months ended March 31, 1999 was 10.17%.
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2 American Variable Insurance Series / Prospectus
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<PAGE>
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Growth Fund
RISK/RETURN SUMMARY
The fund seeks to make your investment grow by investing primarily in common
stocks of companies that appear to offer superior opportunities for growth of
capital. The fund may also invest up to 10% of its assets in equity securities
of issuers domiciled outside the U.S. and not included in the Standard & Poor's
500 Composite Index. The fund is designed for investors seeking capital appre-
ciation through stocks. Investors in the fund should have a long-term perspec-
tive and be able to tolerate potentially wide price fluctuations.
The prices of equity securities held by the fund may decline in response to
certain events, including those directly involving companies whose securities
are owned in the fund, adverse conditions affecting the general economy, over-
all market declines, world political, social and economic instability and cur-
rency fluctuations. Investments outside the U.S. may be affected by these
events to a greater extent and may also be affected by differing securities
regulations and administrative difficulties such as delays in clearing and set-
tling portfolio transactions. The growth oriented, equity-type securities gen-
erally purchased by the fund may involve large price swings and potential for
loss.
The fund relies on the professional judgment of its investment adviser, Capital
Research and Management Company, to make decisions about the fund's portfolio
securities. The basic investment philosophy of Capital Research and Management
Company is to seek undervalued securities that represent good long-term invest-
ment opportunities. Securities may be sold when they are judged to no longer
represent good long-term value.
You may lose money by investing in the fund. The likelihood of loss is greater
if you invest for a shorter period of time. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal Deposit Insur-
ance Corporation or any other government agency, entity or person.
Investment Results
The following information provides an indication of the risks associated with
investing in the fund by showing changes in the fund's investment results from
year to year. Past results are not an indication of future results.
Here are the fund's results calculated on a calendar year basis. (If insurance
separate account fees were included, results would have been lower.)
89 90 91 92 93 94 95 96 97 98
-- -- -- -- -- -- -- -- -- --
30.79 (4.67) 32.90 10.48 16.00 0.23 32.90 13.07 29.79 35.24
The fund's highest/lowest quarterly results during this time period were:
X Highest 29.99% (quarter ended December 31, 1998)
X Lowest -17.08% (quarter ended September 30, 1990)
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American Variable Insurance Series / Prospectus 3
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<PAGE>
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For periods ended December 31, 1998:
<TABLE>
<CAPTION>
Average
Annual Lipper Capital
Total S&P 500 Appreciation
Return Fund/1/ Index/2/ Fund Index/3/ CPI/4/
- ---------------------------------------------------
<S> <C> <C> <C> <C>
One Year 35.24% 28.52% 19.90% 1.61%
...................................................
Five Years 21.46% 24.02% 16.26% 2.37%
...................................................
Ten Years 18.83% 19.16% 15.71% 3.12%
...................................................
Lifetime/5/ 17.45% 18.43% 14.26% 3.24%
</TABLE>
/1/ These fund results were calculated according to a standard formula required
for all stock and bond funds.
/2/ The Standard & Poor's 500 Composite Index represents primarily U.S. stocks.
This index is unmanaged and does not reflect sales charges, commissions or
expenses.
/3/ The Lipper Capital Appreciation Fund Index represents funds that seek growth
of capital but do not necessarily emphasize investments in rapidly growing,
high P/E companies. Sales charges and commissions are not reflected in the
results of the underlying funds.
/4/ The Consumer Price Index is a measure of inflation and is computed from data
supplied by the U.S. Department of Labor, Bureau of Labor Statistics.
/5/ The fund began investment operations on February 8, 1984.
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4 American Variable Insurance Series / Prospectus
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<PAGE>
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International Fund
RISK/RETURN SUMMARY
The fund seeks to make your investment grow over time by investing primarily in
common stocks of companies located outside the United States. The fund is de-
signed for investors seeking capital appreciation through stocks. Investors in
the fund should have a long-term perspective and be able to tolerate poten-
tially wide price fluctuations.
The prices of equity securities held by the fund may decline in response to
certain events, including those directly involving companies whose securities
are owned in the fund, adverse conditions affecting the general economy, over-
all market declines, world political, social and economic instability and cur-
rency fluctuations. Investments outside the U.S. may be affected by these
events to a greater extent and may also be affected by differing securities
regulations and administrative difficulties such as delays in clearing and set-
tling portfolio transactions. The growth oriented, equity-type securities gen-
erally purchased by the fund may involve large price swings and potential for
loss, particularly in the case of smaller capitalization stocks.
The fund relies on the professional judgment of its investment adviser, Capital
Research and Management Company, to make decisions about the fund's portfolio
securities. The basic investment philosophy of Capital Research and Management
Company is to seek undervalued securities that represent good long-term invest-
ment opportunities. Securities may be sold when they are judged to no longer
represent good long-term value.
You may lose money by investing in the fund. The likelihood of loss is greater
if you invest for a shorter period of time. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal Deposit Insur-
ance Corporation or any other government agency, entity or person.
Investment Results
The following information provides an indication of the risks associated with
investing in the fund by showing changes in the fund's investment results from
year to year. Past results are not an indication of future results.
Here are the fund's results calculated on a calendar year basis. (If insurance
separate account feew were included, results would have been lower.)
91 92 93 94 95 96 97 98
11.45 (1.11) 33.97 1.64 12.83 17.23 8.82 20.92
The fund's highest/lowest quarterly results during this time period were:
X Highest 19.64% (quarter ended December 31, 1998)
X Lowest -14.34% (quarter ended September 30, 1998)
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American Variable Insurance Series / Prospectus 5
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<PAGE>
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For periods ended December 31, 1998:
<TABLE>
<CAPTION>
Average
Annual MSCI Lipper
Total EAFE International
Return Fund/1/ Index/2/ Fund Index/3/ CPI/4/
- --------------------------------------------------
<S> <C> <C> <C> <C>
One Year 20.92% 20.33% 12.66% 1.61%
..................................................
Five Years 12.00% 9.50% 8.59% 2.37%
..................................................
Lifetime/5/ 11.05% 8.33% 9.18% 2.81%
</TABLE>
/1/ These fund results were calculated according to a standard formula required
for all stock and bond funds.
/2/ The Morgan Stanley Capital International EAFE (Europe, Australia, Far East)
Index measures all major stock markets outside North America. This index is
unmanaged and does not reflect sales charges, commissions or expenses.
/3/ The Lipper International Fund Index represents funds that invest in securi-
ties with primary trading markets outside the U.S. Sales charges and commis-
sions are not reflected in the results of the underlying funds.
/4/ The Consumer Price Index is a measure of inflation and is computed from data
supplied by the U.S. Department of Labor, Bureau of Labor Statistics.
/5/ The fund began investment operations on May 1, 1990.
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6 American Variable Insurance Series / Prospectus
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<PAGE>
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Growth-Income Fund
RISK/RETURN SUMMARY
The fund seeks to make your investment grow and provide you with income over
time by investing primarily in common stocks or other securities which demon-
strate the potential for appreciation and/or dividends. The fund may also in-
vest up to 10% of its assets in securities of issuers domiciled outside the
U.S. and not included in the Standard & Poor's 500 Composite Index. The fund is
designed for investors seeking both capital appreciation and income.
The prices of equity securities may decline in response to certain events in-
cluding those directly involving companies whose securities are owned in the
fund, adverse conditions affecting the general economy, overall market declines
world political, social and economic instability, and currency fluctuations.
Investments outside the U.S. may be affected by these events to a greater ex-
tent and may also be affected by differing securities regulations, higher
transaction costs, and administrative difficulties such as delays in clearing
and settling portfolio securities.
The fund relies on the professional judgment of its investment adviser, Capital
Research and Management Company, to make decisions about the fund's portfolio
securities. The basic investment philosophy of Capital Research and Management
Company is to seek undervalued securities that represent good long-term invest-
ment opportunities. Securities may be sold when they are judged to no longer
represent good long-term value.
You may lose money by investing in the fund. The likelihood of loss is greater
if you invest for a shorter period of time. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal Deposit Insur-
ance Corporation or any other government agency, entity or person.
Investment Results
The following information provides an indication of the risks associated with
investing in the fund by showing changes in the fund's investment results from
year to year. Past results are not an indication of future results.
Here are the fund's results calculated on a calendar year basis. (If insurance
separate account feew were included, results would have been lower.)
89 90 91 92 93 94 95 96 97 98
-- -- -- -- -- -- -- -- -- --
25.02 (2.87) 23.69 7.62 11.97 1.79 32.63 18.41 25.54 18.09
The fund's highest/lowest quarterly results during this time period were:
X Highest 18.85% (quarter ended December 31, 1998)
X Lowest -11.93% (quarter ended September 30, 1990)
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American Variable Insurance Series / Prospectus 7
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<PAGE>
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For periods ended December 31, 1998:
<TABLE>
<CAPTION>
Average
Annual Lipper Growth
Total S&P 500 and Income
Return Fund/1/ Index/2/ Fund Index/3/ CPI/4/
- --------------------------------------------------
<S> <C> <C> <C> <C>
One Year 18.09% 28.52% 13.58% 1.61%
..................................................
Five Years 18.84% 24.02% 17.83% 2.37%
..................................................
Ten Years 15.67% 19.16% 15.54% 3.12%
..................................................
Lifetime/5/ 15.82% 18.43% 15.20% 3.24%
</TABLE>
/1/ These fund results were calculated according to a standard formula required
for all stock and bond funds.
/2/ The Standard & Poor's 500 Composite Index represents primarily U.S. stocks.
This index is unmanaged and does not reflect sales charges, commissions or
expenses.
/3/ The Lipper Growth and Income Fund Index represents funds that combine a
growth-of-earnings orientation and an income requirement for level and/or
rising dividends. Sales charges and commissions are not reflected in the re-
sults of the underlying funds.
/4/ The Consumer Price Index is a measure of inflation and is computed from data
supplied by the U.S. Department of Labor, Bureau of Labor Statistics.
/5/ The fund began investment operations on February 8, 1984.
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8 American Variable Insurance Series / Prospectus
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<PAGE>
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Cash Position
The funds may also hold cash or money market instruments of any issuer to any
extent deemed appropriate. The size of the funds' cash position will vary and
will depend on various factors, including market conditions and purchases and
redemptions of fund shares. A larger cash position could detract from the
achievement of the funds' objectives, but it also provides greater liquidity to
meet redemptions or to make additional investments, and it would reduce the
fund's exposure in the event of a market downturn.
Portfolio Turnover
Portfolio changes will be made without regard to the length of time particular
investments may have been held. The funds do not anticipate their portfolio
turnover to exceed 100% annually. The funds' portfolio turnover rate would
equal 100% if each security in the funds' portfolios were replaced once per
year. High portfolio turnover involves correspondingly greater transaction
costs in the form of dealer spreads or brokerage commissions, and may result in
the realization of net capital gains, which are taxable when distributed to
shareholders. Debt securities are generally traded on a net basis and usually
neither brokerage commissions nor transfer taxes are involved. See the "Finan-
cial Highlights" for the funds' portfolio turnover for each of the last five
years.
YEAR 2000
The date-related computer issue known as the "Year 2000 problem" could have an
adverse impact on the quality of services provided to the Series and its share-
holders. However, the Series understands that its key service providers --
including the investment adviser and its affiliates -- are taking steps to ad-
dress the issue. In addition, the Year 2000 problem may adversely affect the
issuers in which the funds invest. For example, issuers may incur substantial
costs to address the problem. They may also suffer losses caused by corporate
and governmental data processing errors. The Series and its investment adviser
will continue to monitor developments relating to this issue.
MANAGEMENT AND ORGANIZATION
Investment Adviser
Capital Research and Management Company, an experienced investment management
organization founded in 1931, serves as investment adviser to the Series and
other mutual funds, including those in The American Funds Group. Capital Re-
search Management Company, a wholly owned subsidiary of The Capital Group Com-
panies, Inc., is headquartered at 333 South Hope Street, Los Angeles, CA 90071.
Capital Research Management Company manages the investment portfolios and busi-
ness affairs of the Series.
The total management fee paid by each fund, as a percentage of average net as-
sets, for the previous fiscal year amounted to the following: Global Small Cap-
italization Fund -- .79%; Growth Fund -- .40%; International Fund -- .57%; and
Growth-Income Fund -- .35%.
Capital Research and Management Company and its affiliated companies have
adopted a personal investing policy that is consistent with the recommendations
contained in the May 9, 1994 report issued by the Investment Company Insti-
tute's Advisory Group on Personal Investing. This policy has been incorporated
into the Series' code of ethics.
Multiple Portfolio Counselor System
Capital Research and Management Company uses a system of multiple portfolio
counselors in managing mutual fund assets. Under this system the portfolio of a
fund is divided into segments which are managed by individual counselors. Coun-
selors decide how their respective segments will be invested (within the limits
provided by a fund's objective(s) and policies and by Capital Research and Man-
agement Company's investment committee). In addition, Capital Research and Man-
agement Company's research professionals may make investment decisions with re-
spect to a portion of the fund's portfolio. The primary portfolio counselors
for each of the funds are listed on the next two pages.
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American Variable Insurance Series / Prospectus 9
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<PAGE>
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<TABLE>
<CAPTION>
Approximate Years
of Experience as
an Investment
Professional
(including the
last five years)
-------------------
Years of Experience With Capital
as Portfolio Counselor Research and
(and Research Professional, Management
Portfolio Counselors if applicable) Company or Total
for the Series Primary Title(s) (approximate) Affiliates Years
----------------------------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
James K. Dunton President of the Series. Growth-Income Fund -- 15 37 37
Senior Vice President and years (since the fund began
Director, Capital Research operations)
and Management Company
---------------------------------------------------------------------------------------------------
Abner D. Goldstine Senior Vice President of Asset Allocation Fund -- 10 32 47
the Series. Senior Vice years (since the fund began
President and Director, operations)
Capital Research and Bond Fund -- 3 years (since
Management Company the fund began operations)
High-Yield Bond Fund -- 1
year
---------------------------------------------------------------------------------------------------
Alan N. Berro Vice President of the Growth-Income Fund -- 3 8 13
Series. Senior Vice years (plus 6 years as a
President, Capital Research research professional prior
Company* to becoming a portfolio
counselor for the fund)
---------------------------------------------------------------------------------------------------
Claudia P. Huntington Vice President of the Growth-Income Fund -- 5 22 25
Series. Senior Vice years (plus 5 years as a
President, Capital Research research professional prior
and Management Company to becoming a portfolio
counselor for the fund)
---------------------------------------------------------------------------------------------------
Robert W. Lovelace Vice President of the Global Small Capitalization 14 14
Series, Senior Vice Fund -- 1 year (since the
President, Capital Research fund began operations)
and Management Company Global Growth Fund -- 2
years (since the fund began
operations)
International Fund -- 4
years
New World Fund -- less than
1 year (since the fund
began operations)
---------------------------------------------------------------------------------------------------
Donald D. O'Neal Vice President of the Global Growth Fund -- 2 14 14
Series. Senior Vice years (since the fund began
President, Capital Research operations) Growth Fund --
and Management Company 8 years (plus 4 years as a
research professional prior
to becoming a portfolio
counselor for the fund)
---------------------------------------------------------------------------------------------------
John H. Smet Vice President of the Bond Fund -- 3 years (since 16 17
Series. Vice President, the fund began operations)
Capital Research and U.S. Government Fund -- 7
Management Company years
---------------------------------------------------------------------------------------------------
Timothy D. Armour Chairman and Chief Asset Allocation Fund -- 3 16 16
Executive Officer, Capital years
Research Company*
---------------------------------------------------------------------------------------------------
David C. Barclay Vice President and High-Yield Bond Fund -- 6 11 18
Director, Capital Research years
and Management Company New World Fund -- less than
1 year (since the fund
began operations)
---------------------------------------------------------------------------------------------------
Martial Chaillet Senior Vice President and Global Growth Fund -- 2 27 27
Director, Capital Research years (since the fund began
Company* operations)
International Fund -- 6
years
---------------------------------------------------------------------------------------------------
Gordon Crawford Senior Vice President and Global Small Capitalization 28 28
Director, Capital Research Fund -- 1 year (since the
and Management Company fund began operations)
Growth Fund -- 5 years
(plus 5 years as a research
professional prior to
becoming a portfolio
counselor for the fund)
---------------------------------------------------------------------------------------------------
Mark E. Denning Director, Capital Research Global Small Capitalization 17 17
and Management Company Fund -- 1 year (since the
fund began operations)
New World Fund -- less than
1 year (since the fund
began operations)
---------------------------------------------------------------------------------------------------
James E. Drasdo Senior Vice President and Growth Fund -- 12 years 22 27
Director, Capital Research
and Management Company
---------------------------------------------------------------------------------------------------
Alwyn Heong Vice President, Capital International Fund -- 3 7 11
Research Company* years
New World Fund -- less than
1 year (since the fund
began operations)
---------------------------------------------------------------------------------------------------
Thomas H. Hogh Vice President -- Capital U.S. Government Fund -- 1 9 12
International Research, year
Inc.*
---------------------------------------------------------------------------------------------------
Carl M. Kawaja Vice President, Capital New World Fund -- less than 8 12
Research Company* 1 year (since fund began
operations)
---------------------------------------------------------------------------------------------------
Robert G. O'Donnell Senior Vice President and Growth-Income Fund -- 9 24 27
Director, Capital Research years (plus 1 year as a
and Management Company research professional prior
to becoming a portfolio
counselor for the fund)
---------------------------------------------------------------------------------------------------
Victor M. Parachini Senior Vice President, Asset Allocation Fund -- 3 24 37
Capital Research and years
Management Company
</TABLE>
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10 American Variable Insurance Series / Prospectus
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<PAGE>
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<TABLE>
<CAPTION>
Approximate Years
of Experience as
an Investment
Professional
(including the
last five years)
------------------
Years of Experience With Capital
as Portfolio Counselor Research and
Portfolio (and Research Professional, Management
Counselors if applicable) Company or Total
for the Series Primary Title(s) (approximate) Affiliates Years
-----------------------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
John W. Ressner Executive Vice President U.S. Government Fund -- 1 11 11
and Director --Capital year
Research Company*
-----------------------------------------------------------------------------------------------
Susan M. Tolson Vice President and High-Yield Bond Fund -- 4 9 11
Director, Capital Research years (plus 3 years as a
Company* research professional prior
to becoming a portfolio
counselor for the fund)
-----------------------------------------------------------------------------------------------
Gregory W. Wendt Senior Vice President and Global Small Capitalization 12 12
Director, Capital Research Fund -- 1 year (since the
Company* fund began operations)
-----------------------------------------------------------------------------------------------
* Company affiliated with Capital Research and Management Company.
</TABLE>
PURCHASES AND REDEMPTIONS OF SHARES
Shares of the Series are currently offered only to insurance company separate
accounts which fund the Contracts. All such shares may be purchased or redeemed
by the separate accounts at net asset values, without any sales or redemption
charges. Such purchases and redemptions are made subsequent to corresponding
purchases and redemptions of units of the separate accounts without delay.
Share Price
Each fund calculates its share price, also called net asset value, as of 4:00
p.m. New York time, which is the normal close of trading on the New York Stock
Exchange, every day the Exchange is open. If a market price for a particular
security is not available, a fund will determine the appropriate price for the
security. Shares of the funds will be purchased or sold at the net asset value,
next determined after receipt of requests from the appropriate insurance compa-
ny. Certain of the funds invest in securities listed on foreign exchanges which
trade on Saturdays or other U.S. business holidays. Since the funds typically
do not calculate their net asset values on Saturdays or other U.S. business
holidays, the value of the funds' redeemable securities may be affected on days
when shareholders do not have access to the funds.
PLAN OF DISTRIBUTION
Class 2 shares pay .25% of average net assets annually, pursuant to a Plan of
Distribution or "12b-1 plan." Currently, Class 2 shares are available through
various variable annuity and life insurance contracts. Amounts paid under the
12b-1 plan are used by insurance company contract issuers to cover the expense
of certain contract owner services. Class 2 shares pay only their proportionate
share of Series expenses plus 12b-1 plan expenses. Since these fees are paid
out of a fund's assets on an ongoing basis, over time they will increase the
cost of an investment.
DISTRIBUTION ARRANGEMENTS
Dividends and Distributions
It is the Series' policy to distribute to the shareholders (the insurance com-
pany separate accounts) all of its net investment income and capital gains re-
alized during each fiscal year.
Each fund of the Series intends to qualify as a "regulated investment company"
under the Internal Revenue Code. In any fiscal year in which a fund so quali-
fies and distributes to shareholders its net investment income and realized
capital gains, the fund itself is relieved of federal income tax.
See the applicable Contract prospectus for information regarding the federal
income tax treatment of the Contracts and distributions to the separate ac-
counts.
- --------------------------------------------------------------------------------
American Variable Insurance Series / Prospectus 11
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<PAGE>
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FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the funds'
results for the past five years. Certain information reflects financial results
for a single fund share. The total returns in the table represent the rate than
an investor would have earned or lost on an investment in a fund (assuming re-
investment of all dividends and distributions). This information has been au-
dited by PricewaterhouseCoopers LLP, whose report, along with the funds' finan-
cial statements, are included in the statement of additional information, which
is available upon request.
<TABLE>
<CAPTION>
Income From Investment Operations Less Distributions
Net gains or
Net asset losses on Dividends Net asset
Year value, Net securities (both Total from (from net Distributions value,
ended beginning investment realized and investment investment (from capital Total end of Total
11/30 of year income unrealized) operations income) gains) distributions year return
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Global Growth Fund/1/
- -------------------------------------------------------------------------------------------------------------------
Class 1
1997 $10.00 $.06 $ .59 $ .65 $(.03) -- $(.03) $10.62 6.45%/2/
1998 10.62 .13 2.43 2.56 (.14) $ (.02) (.16) 13.02 24.26
- -------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 10.00 .03 .60 .63 (.02) -- (.02) 10.61 6.28/2/
1998 10.61 .10 2.44 2.54 (.11) (.02) (.13) 13.02 24.06
Global Small Capitalization Fund/4/
- -------------------------------------------------------------------------------------------------------------------
Class 1
1998 $10.00 $.07 $(.92) $(.85) $(.04) -- $(.04) $9.11 (8.31)%/2/
- -------------------------------------------------------------------------------------------------------------------
Class 2
1998 10.00 .04 (.91) (.87) (.03) -- (.03) 9.10 (8.49)/2/
Growth Fund
- -------------------------------------------------------------------------------------------------------------------
Class 1
1994 $32.34 $.24 $ .69 $ .93 $(.24) $(1.09) $(1.33) $31.94 2.92%
1995 31.94 .33 10.63 10.96 (.29) (.80) (1.09) 41.81 35.35
1996 41.81 .24 5.17 5.41 (.29) (3.40) (3.69) 43.53 14.32
1997 43.53 .27 9.61 9.88 (.27) (3.02) (3.29) 50.12 24.57
1998 50.12 .19 10.91 11.10 (.17) (6.14) (6.31) 54.91 25.27
- -------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 40.59 .11 9.51 9.62 (.12) -- (.12) 50.09 23.73/2/
1998 50.09 .08 10.90 10.98 (.05) (6.14) (6.19) 54.88 24.97
International Fund
- -------------------------------------------------------------------------------------------------------------------
Class 1
1994 $12.40 $.25 $1.04 $1.29 $(.20) $ (.22) $ (.42) $13.27 10.48%
1995 13.27 .34 1.02 1.36 (.33) (.41) (.74) 13.89 10.78
1996 13.89 .28 1.96 2.24 (.31) (.29) (.60) 15.53 16.66
1997 15.53 .25 1.18 1.43 (.27) (.62) (.89) 16.07 9.52
1998 16.07 .22 2.21 2.43 (.28) (1.65) (1.93) 16.57 16.94
- -------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 15.86 .13 .23 .36 (.16) -- (.16) 16.06 2.20/2/
1998 16.06 .20 2.19 2.39 (.24) (1.65) (1.89) 16.56 16.63
Growth-Income Fund
- -------------------------------------------------------------------------------------------------------------------
Class 1
1994 $26.01 $.68 $ .14 $ .82 $(.65) $ (.88) $(1.53) $25.30 3.21%
1995 25.30 .73 7.20 7.93 (.73) (1.03) (1.76) 31.47 33.14
1996 31.47 .71 5.55 6.26 (.74) (1.26) (2.00) 35.73 21.02
1997 35.73 .73 6.78 7.51 (.72) (2.55) (3.27) 39.97 22.92
1998 39.97 .67 4.60 5.27 (.68) (3.83) (4.51) 40.73 14.77
- -------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 34.10 .37 5.82 6.19 (.35) -- (.35) 39.94 18.18/2/
1998 39.94 .58 4.60 5.18 (.59) (3.83) (4.42) 40.70 14.49
<CAPTION>
Ratios/Supplemental Data
Net assets, Ratio of Ratio of
Year end of year expenses net income Portfolio
ended (in to average to average turnover
11/30 millions) net assets net assets rate
<S> <C> <C> <C> <C>
Global Growth Fund/1/
- --------------------------------------------------------
Class 1
1997 $ 80 .44%/2/ .80%/2/ 13.22%/2/
1998 132 .75 1.14 25.56
- --------------------------------------------------------
Class 2/3/
1997 46 .57/2/ .56/2/ 13.22/2/
1998 124 1.00 .87 25.56
Global Small Capitalization Fund/4/
- --------------------------------------------------------
Class 1
1998 $55 .51%/2/ .86%/2/ 28.20%/2/
- --------------------------------------------------------
Class 2
1998 17 .64/2/ .63/2/ 28.20/2/
Growth Fund
- --------------------------------------------------------
Class 1
1994 $2,027 .49% .78% 29.58%
1995 3,154 .47 .92 35.47
1996 3,860 .44 .61 30.88
1997 4,671 .42 .59 45.14
1998 5,313 .41 .38 49.91
- --------------------------------------------------------
Class 2/3/
1997 75 .37/2/ .08/2/ 45.14
1998 310 .66 .15 49.91
International Fund
- --------------------------------------------------------
Class 1
1994 $1,405 .80% 2.03% 19.66%
1995 1,703 .75 2.64 24.66
1996 2,370 .69 1.99 32.08
1997 2,612 .67 1.56 50.12
1998 2,593 .66 1.36 34.08
- --------------------------------------------------------
Class 2/3/
1997 48 .53/2/ .34/2/ 50.12
1998 126 .91 1.03 34.08
Growth-Income Fund
- --------------------------------------------------------
Class 1
1994 $2,740 .47% 2.72% 29.26%
1995 3,953 .44 2.70 26.91
1996 5,249 .41 2.26 31.27
1997 6,430 .38 2.01 37.55
1998 6.704 .36 1.74 42.72
- --------------------------------------------------------
Class 2/3/
1997 157 .35/2/ .93/2/ 37.55
1998 564 .61 1.02 42.72
</TABLE>
- --------------------------------------------------------------------------------
12 American Variable Insurance Series / Prospectus
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Income From Investment Operations Less Distributions
Net gains or
Net asset losses on Dividends Distributions Net asset
Year value, Net securities (both Total from (from net (from value,
ended beginning investment realized and investment investment realized Total end of Total
11/30 of period income unrealized) operations income) gains) distributions year return
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Asset Allocation Fund
- ------------------------------------------------------------------------------------------------------------------
Class 1
1994 $12.01 $.51 $(.57) $(.06) $(.52) $(.18) $(.70) $11.25 (.54)%
1995 11.25 .50 2.69 3.19 (.50) (.17) (.67) 13.77 29.45
1996 13.77 .53 1.89 2.42 (.53) (.48) (1.01) 15.18 18.65
1997 15.18 .55 1.94 2.49 (.54) (.97) (1.51) 16.16 17.90
1998 16.16 .58 1.27 1.85 (.57) (.87) (1.44) 16.57 12.32
- ------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 14.43 .29 1.69 1.98 (.26) -- (.26) 16.15 13.80/2/
1998 16.15 .53 1.28 1.81 (.53) (.87) (1.40) 16.56 12.05
Bond Fund/5/
- ------------------------------------------------------------------------------------------------------------------
Class 1
1996 $10.00 $.40 $.16 $.56 $(.25) -- $(.25) $10.31 5.74%/2/
1997 10.31 .63 .30 .93 (.62) -- (.62) 10.62 9.36
1998 10.62 .67 (.15) .52 (.65) $(.12) (.77) 10.37 5.12
Class 2/3/
1997 10.11 .35 .46 .81 (.31) -- (.31) 10.61 8.09/2/
1998 10.61 .65 (.15) .50 (.63) (.12) (.75) 10.36 4.85
High-Yield Bond Fund
- ------------------------------------------------------------------------------------------------------------------
Class 1
1994 $15.17 $1.27 $(2.07) $(.80) $(1.23) $(.25) $(1.48) $12.89 (5.71)%
1995 12.89 1.32 1.10 2.42 (1.32) -- (1.32) 13.99 19.81
1996 13.99 1.28 .54 1.82 (1.30) -- (1.30) 14.51 13.75
1997 14.51 1.29 .43 1.72 (1.27) -- (1.27) 14.96 12.45
1998 14.96 1.26 (1.04) .22 (1.25) (.16) (1.41) 13.77 1.44
- ------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 14.28 .69 .61 1.30 (.63) -- (.63) 14.95 9.20/2/
1998 14.95 1.25 (1.06) .19 (1.22) (.16) (1.38) 13.76 1.18
U.S. Government/AAA-Rated Securities Fund
- ------------------------------------------------------------------------------------------------------------------
Class 1
1994 $12.15 $.76 $(1.30) $(.54) $(.74) $(.07) $(.81) $10.80 (4.58)%
1995 10.80 .82 .71 1.53 (.81) -- (.81) 11.52 14.73
1996 11.52 .83 (.24) .59 (.82) -- (.82) 11.29 5.49
1997 11.29 .76 (.07) .69 (.80) -- (.80) 11.18 6.49
1998 11.18 .68 .26 .94 (.69) -- (.69) 11.43 8.72
- ------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 10.83 .38 .33 .71 (.37) -- (.37) 11.17 6.65/2/
1998 11.17 .68 .24 .92 (.67) -- (.67) 11.42 8.46
Cash Management Fund
- ------------------------------------------------------------------------------------------------------------------
Class 1
1994 $11.02 $.37 $.02 $.39 $(.32) -- $(.32) $11.09 3.59%
1995 11.09 .63 (.02) .61 (.59) -- (.59) 11.11 5.65
1996 11.11 .54 .01 .55 (.54) -- (.54) 11.12 5.09
1997 11.12 .57 (.01) .56 (.55) -- (.55) 11.13 5.21
1998 11.13 .57 (.01) .56 (.56) -- (.56) 11.13 5.17
- ------------------------------------------------------------------------------------------------------------------
Class 2/3/
1997 11.07 .28 .03 .31 (.26) -- (.26) 11.12 2.87/2/
1998 11.12 .55 (.02) .53 (.53) -- (.53) 11.12 4.92
<CAPTION>
Ratios/Supplemental Data
Net assets, Ratio of Ratio of
Year end of year expenses net income Portfolio
ended (in to average to average turnover
11/30 millions) net assets net assets rate
<S> <C> <C> <C> <C>
Asset Allocation Fund
- ------------------------------------------------------
Class 1
1994 $ 637 .53% 4.55% 36.13%
1995 870 .52 4.11 39.89
1996 1,141 .49 3.88 50.62
1997 1,393 .47 3.63 34.14
1998 1,497 .45 3.63 27.97
- --------------------------------------------------------
Class 2/3/
1997 42 .40/2/ 1.81/2/ 34.14
1998 173 .70 3.39 27.97
Bond Fund/5/
- --------------------------------------------------------
Class 1
1996 $ 77 .52%/2/ 6.18%/2/ 32.83%/2/
1997 132 .55 6.63 52.93
1998 186 .54 6.89 61.54
- --------------------------------------------------------
Class 2/3/
1997 12 .44/2/ 3.50/2/ 52.93
1998 45 .78 6.62 61.54
High-Yield Bond Fund
- --------------------------------------------------------
Class 1
1994 $390 .54% 9.37% 38.46%
1995 534 .54 10.12 31.73
1996 662 .53 9.27 44.81
1997 765 .51 8.92 50.22
1998 715 .51 8.66 65.80
- --------------------------------------------------------
Class 2/3/
1997 21 .43/2/ 4.92/2/ 50.22
1998 68 .76 8.60 65.80
U.S. Government/AAA-Rated Securities Fund
- --------------------------------------------------------
Class 1
1994 $463 .54% 6.69% 45.21%
1995 542 .54 7.37 30.11
1996 512 .53 7.33 30.45
1997 471 .52 6.73 53.80
1998 537 .51 6.11 89.25
- --------------------------------------------------------
Class 2/3/
1997 7 .44/2/ 3.45/2/ 53.80
1998 32 .75 5.68 89.25
Cash Management Fund
- --------------------------------------------------------
Class 1
1994 $221 .49% 3.60% --
1995 193 .49 5.37 --
1996 240 .47 4.94 --
1997 226 .47 4.99 --
1998 250 .46 5.07 --
- --------------------------------------------------------
Class 2/3/
1997 14 .41/2/ 2.80/2/ --
1998 34 .70 4.75 --
</TABLE>
/1/ Commenced operations April 30, 1997.
/2/ Based on operations for the period shown and, accordingly, not
representative of a full year.
/3/ Shares offered for sale commencing April 30, 1997.
/4/ Commenced operations on April 30, 1998.
/5/ Commenced operations January 2, 1996.
No information is presented for the New World Fund since it had no investment
operations as of April 1, 1999.
- --------------------------------------------------------------------------------
American Variable Insurance Series / Prospectus 13
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
OTHER FUND INFORMATION
Annual/Semi-Annual Report to Shareholders
Contains additional information about the Series including finan-
cial statements, investment results, portfolio holdings, a state-
ment from portfolio management discussing market conditions and
the Series' investment strategies that significantly affected each
fund's performance during its latest fiscal year, and the indepen-
dent accountants' report (in the annual report).
Statement of Additional Information (SAI)
Contains more detailed information on all aspects of the Series,
including the Series financial statements.
A current SAI has been filed with the Securities and Exchange Com-
mission ("SEC") and is incorporated by reference into this pro-
spectus. The SAI and other related materials about the Series are
available for review or to be copied at the SEC Public Reference
Room in Washington, D.C. (1-800-SEC-0330) or on the SEC's Internet
Web site at http://www.sec.gov.
Code of Ethics
Includes a description of the Series personal investing policy.
To request a free copy of any of the documents above, write to:
Secretary of the Series
333 South Hope Street
Los Angeles, CA 90071
Investment Company File No. 811-3857 26-101-799
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