<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 9 (File No. 33-45776) [x]
---------
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 10 (File No. 811-6560) [x]
---------
(Check appropriate box or boxes)
IDS LIFE OF NEW YORK ACCOUNT SBS
(formerly IDS Life of New York Account SLB)
- -------------------------------------------------------------------------------
(Exact Name of Registrant)
IDS Life Insurance Company of New York
- -------------------------------------------------------------------------------
(Name of Depositor)
20 Madison Avenue Extension, Albany, New York 12203
- -------------------------------------------------------------------------------
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 671-3678
- -------------------------------------------------------------------------------
Mary Ellyn Minenko, IDS Tower 10, Minneapolis, MN 55440-0010
- -------------------------------------------------------------------------------
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b) of Rule 485
[x] on April 30, 1999 pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(i) of Rule 485
[ ] on (date) pursuant to paragraph (a)(i) of Rule 485
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
<PAGE>
SYMPHONY ANNUITY
PROSPECTUS/APRIL 30, 1999
Group flexible premium deferred combination fixed/variable annuity.
IDS LIFE OF NEW YORK ACCOUNT SBS
Issued by:
IDS Life Insurance Company of New York
20 Madison Avenue Extension
P.O. Box 5144
Albany, NY 12205
Telephone: 800-336-3646
This prospectus contains information that you should know before investing. You
also will receive the following prospectuses:
- - Greenwich Street Series Fund, and
- - IDS Life Retirement Annuity Mutual Funds.
Please read both prospectuses carefully and keep them for future reference. This
certificate is available for qualified and nonqualified retirement plans.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR PASSED UPON THE ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
AN INVESTMENT IN THIS ANNUITY IS NOT A DEPOSIT OF A BANK OR FINANCIAL
INSTITUTION AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN THIS ANNUITY
INVOLVES INVESTMENT RISK INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
A Statement of Additional Information (SAI), dated the same date as this
prospectus, is incorporated by reference into this prospectus. It is filed with
the Securities and Exchange Commission (SEC), and is available without charge by
contacting IDS Life of New York at the telephone number above or by completing
and sending the order form on page 30 of this prospectus. The table of contents
of the SAI is on page 29 of this prospectus.
1 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Key Terms......................................................... 3
The Certificate in Brief.......................................... 4
Expense Summary................................................... 5
Condensed Financial Information (Unaudited)....................... 8
Financial Statements.............................................. 10
Performance Information........................................... 10
The Variable Account.............................................. 11
The Funds......................................................... 11
The Fixed Account................................................. 14
Buying Your Certificate........................................... 14
Charges........................................................... 16
Valuing Your Investment........................................... 18
Making the Most of Your Certificate............................... 19
Surrenders........................................................ 21
TSA -- Special Surrender Provisions............................... 22
Changing Ownership................................................ 22
Benefits in Case of Death......................................... 23
The Annuity Payout Period......................................... 23
Taxes............................................................. 25
Voting Rights..................................................... 27
About the Service Providers....................................... 27
Year 2000......................................................... 28
Table of Contents of the Statement of Additional Information...... 29
</TABLE>
2 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
KEY TERMS
These terms can help you understand details about your contract.
ACCUMULATION UNIT -- A measure of the value of each variable subaccount before
annuity payouts begin.
ANNUITANT -- The person on whose life or life expectancy the annuity payouts are
based.
ANNUITY PAYOUTS -- An amount paid at regular intervals under one of several
plans.
BENEFICIARY -- The person you designate to receive annuity benefits in case of
the owner's or annuitant's death while the certificate is in force and before
annuity payouts begin.
CLOSE OF BUSINESS -- When the New York Stock Exchange (NYSE) closes, normally 4
p.m. Eastern time.
CERTIFICATE VALUE -- The total value of your certificate before we deduct any
applicable charges.
CERTIFICATE YEAR -- A period of 12 months, starting on the effective date of
your certificate and on each anniversary of the effective date.
FIXED ACCOUNT -- An account to which you may allocate purchase payments. Amounts
you allocate to this account earn interest at rates that we declare
periodically.
FUNDS -- Mutual funds and/or portfolios that are investment options under your
certificate, each with a different investment objective. You may allocate your
purchase payments into variable accounts investing in shares of any or all of
these funds.
OWNER (YOU, YOUR) -- The person who controls the certificate (decides on
investment allocations, transfers, payout options, etc.). Usually, but not
always, the owner is also the annuitant. The owner is responsible for taxes,
regardless of whether he or she receives the certificate's benefits.
QUALIFIED ANNUITY -- A certificate that you purchase for one of the following
retirement plans that is subject to applicable federal law and any rules of the
plan itself:
- - Individual Retirement Annuities (IRAs)
- - Simplified Employee Pension (SEP) plans
- - Section 401(k) plans
- - Custodial and trusteed pension and profit sharing plans
- - Tax Sheltered Annuities (TSAs)
All other certificates are considered NONQUALIFIED ANNUITIES.
RETIREMENT DATE -- The date when annuity payouts are scheduled to begin.
SURRENDER VALUE -- The amount you are entitled to receive if you make a full
surrender from your certificate. It is the certificate value minus any
applicable charges.
VALUATION DATE -- Any normal business day, Monday through Friday, that the NYSE
is open. Each valuation date ends at the close of business. We calculate the
value of each subaccount at the close of business on each valuation date.
VARIABLE ACCOUNT -- Consists of separate subaccounts to which you may allocate
purchase payments; each invests in shares of one fund. The value of your
investment in each subaccount changes with the performance of the particular
fund.
3 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
THE CERTIFICATE IN BRIEF
PURPOSE: The purpose of the certificate is to allow you to accumulate money for
retirement. You do this by making one or more investments (purchase payments)
that may earn returns that increase the value of the certificate. The
certificate provides lifetime or other forms of payouts beginning at a specified
date (the retirement date). As in the case of other annuities, it may not be
advantageous for you to purchase this certificate as a replacement for, or in
addition to an existing annuity.
FREE LOOK PERIOD: You may return your certificate to your financial consultant
or to our office within 10 days after it is delivered to you and receive a full
refund of all your purchase payments.
ACCOUNTS: Currently, you may allocate your purchase payments among any or all
of:
- - the subaccounts, each of which invests in a fund with a particular investment
objective. The value of each subaccount varies with the performance of the
particular fund in which it invests. We cannot guarantee that the value at the
retirement date will equal or exceed the total purchase payments you allocate
to the subaccounts. (p. 11)
- - the fixed account, which earns interest at a rate that we adjust periodically.
(p. 14)
BUYING YOUR CERTIFICATE: Your financial consultant will help you complete and
submit an application. Applications are subject to acceptance at our office. You
may buy a nonqualified annuity or a qualified annuity. You must make an initial
lump-sum purchase payment. You have the option of making additional purchase
payments in the future. (p. 14)
- - Minimum initial purchase payment -- $5,000 for nonqualified annuities; $500
for qualified annuities
- - Minimum additional purchase payment -- $500 for nonqualified annuities; $50
for qualified annuities
- - Maximum total purchase payments -- $1,000,000
TRANSFERS: Subject to certain restrictions you currently may redistribute your
money among the subaccounts and the fixed account without charge at any time
until annuity payouts begin. You may establish automated transfers among the
fixed account and subaccounts. Fixed account transfers are subject to special
restrictions. (p. 19)
SURRENDERS: You may surrender all or part of your certificate value at any time
before the retirement date. You may also establish systematic withdrawals.
Surrenders may be subject to charges and tax penalties (including a 10% IRS
penalty if you surrender prior to your reaching age 59 1/2) and may have other
tax consequences; also, certain restrictions may apply. (p. 21)
CHANGING OWNERSHIP: You may change ownership of a nonqualified annuity by
written instruction, but this may have federal income tax consequences.
Restrictions apply to changing ownership of a qualified annuity. (p. 22)
BENEFITS IN CASE OF DEATH: If you or the annuitant die before annuity payouts
begin, we will pay the beneficiary an amount at least equal to certificate
value. (p. 22)
ANNUITY PAYOUTS: You can apply your certificate value to an annuity payout plan
that begins on the retirement date. You may choose from a variety of plans to
make sure that payouts continue as long as you like. If you purchased a
qualified annuity, the payout schedule must meet the requirements of the
qualified plan. Payouts will be made on a fixed basis. (p. 23)
TAXES: Generally, your certificate grows tax-deferred until you surrender it or
begin to receive payouts. (Under certain circumstances, IRS penalty taxes may
apply). Even if you direct payouts to someone else, you will be taxed on the
income if you are the owner. (p. 25)
4 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
CHARGES:
- - $30 annual certificate administrative charge;
- - 0.25% variable account administrative charge;
- - 1.25% mortality and expense risk fee;
- - surrender charge; and
- - the operating expenses of the funds.
- --------------------------------------------------------------------------------
EXPENSE SUMMARY
The purpose of this table is to help you understand the various costs and
expenses associated with your certificate.
You pay no sales charge when you purchase your certificate. We show all costs
that you bear directly or indirectly for the subaccounts and funds below. Some
expenses may vary as we explain under "Charges."
<TABLE>
<CAPTION>
ANNUAL CERTIFICATE OWNER EXPENSES:
- ----------------------------------------------
Certificate
SURRENDER CHARGE Years Percentage
------------ ----------
<S> <C> <C>
(contingent deferred 1 6%
sales charge as a 2 5
percentage of 3 4
purchase 4 3
payments) 5 2
6 1
7 and later 0
CERTIFICATE ADMINISTRATIVE CHARGE $30
</TABLE>
<TABLE>
<CAPTION>
ANNUAL SUBACCOUNT EXPENSES
(as a percentage of average daily net assets of the
subaccounts):
- -----------------------------------------------------------
<S> <C>
VARIABLE ACCOUNT ADMINISTRATIVE CHARGE.............. 0.25%
MORTALITY AND EXPENSE RISK FEE...................... 1.25%
- -----------------------------------------------------------
TOTAL ANNUAL SUBACCOUNT EXPENSES.................... 1.50%
- -----------------------------------------------------------
- -----------------------------------------------------------
</TABLE>
5 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
ANNUAL OPERATING EXPENSES OF THE FUNDS
<TABLE>
<CAPTION>
(as a percentage of average daily net assets)
- ------------------------------------------------------------------------------------------------------------------------
EMERGING EQUITY EQUITY
APPRECIATION GROWTH INCOME INDEX
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -----------
DIVERSIFIED
STRATEGIC
INCOME
PORTFOLIO
-----------
<S> <C> <C> <C> <C> <C>
Management fees.................................... .75% .65% .95% .65% .21%
Other expenses..................................... .05 .13 .33 .14 .09
-------------------------------------------------------------------
Total(1)........................................... .80% .78% 1.28% .79% .30%(2)
-------------------------------------------------------------------
-------------------------------------------------------------------
<CAPTION>
(as a percentage of average daily net assets)
- ---------------------------------------------------
GROWTH & INTERMEDIATE INTERNATIONAL MONEY TOTAL
INCOME HIGH GRADE EQUITY MARKET RETURN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Management fees.................................... .65% .60% 1.05% .50% .75%
Other expenses..................................... .07 .33 .35 .74 .04
Total(1)........................................... .72% .93% 1.40% 1.24%(2) .79%
</TABLE>
(1) Annualized operating expenses of underlying portfolios at Dec. 31, 1998.
(2) Figures in "Management fees," "Other expenses" and "Total" reflects waiver
of expenses by the investment advisor for the Money Market Portfolio and Equity
Index Portfolio. If there had been no reimbursement of expenses in 1998, the
"Management fees", "Other expenses" and "Total" that would have been incurred
for the last completed fiscal year would be: 0.21%, 0.21%, 0.42%, respectively
for the Equity Index Portfolio, and 0.50%, 1.24%, 1.74%, respectively, for the
Money Market Portfolio.
EXAMPLE*
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return and full surrender at the end of each time period:
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 year................... $ 84.02 $ 83.81 $ 88.94 $ 83.91 $ 78.89 $ 83.20 $ 85.35 $ 90.17 $ 88.53 $ 83.91
3 years.................. 113.94 113.32 128.65 113.63 98.45 111.47 117.93 132.30 127.43 113.63
5 years.................. 146.48 145.46 170.90 145.97 120.52 142.37 153.15 176.93 168.89 145.97
10 years................. 270.28 268.22 318.38 269.25 217.67 262.03 283.53 330.06 314.46 269.25
</TABLE>
You would pay the following expenses on the same investment assuming no
surrender or selection of an annuity payout plan at the end of each time period:
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 year................... $ 24.02 $ 23.81 $ 28.94 $ 23.91 $ 18.89 $ 23.20 $ 25.35 $ 30.17 $ 28.53 $ 23.91
3 years.................. 73.94 73.32 88.65 73.63 58.45 71.47 77.93 92.30 87.43 73.63
5 years.................. 126.48 125.46 150.90 125.97 100.52 122.37 133.15 156.93 148.89 125.97
10 years................. 270.28 268.22 318.38 269.25 217.67 262.03 283.53 330.06 314.46 269.25
</TABLE>
* In this example, the $30 annual certificate administrative charge is
approximated as a 0.045% charge based on our average certificate size.
YOU SHOULD NOT CONSIDER THIS EXAMPLE AS A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.
6 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
IDS LIFE IDS IDS LIFE
CAPITAL LIFE SPECIAL
RESOURCE MANAGED INCOME
-------- ------- --------
<S> <C> <C> <C> <C>
Management fees............... .59% .59% .60%
Other expenses................ .07 .04 .07
-----------------------------
Total(1)...................... .66% .63% .67%
-----------------------------
-----------------------------
</TABLE>
(1) Annualized operating expenses of underlying mutual funds at Dec. 31, 1998.
EXAMPLE*
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return and full surrender at the end of each time period.
<TABLE>
<S> <C> <C> <C>
1 year............................. $ 82.58 $ 82.27 $ 82.68
3 years............................ 109.62 108.69 109.93
5 years............................ 139.27 137.72 139.78
10 years........................... 255.81 252.68 256.85
</TABLE>
You would pay the following expenses on the same investment assuming no
surrender or selection of an annuity payout plan at the end of each time period:
<TABLE>
<S> <C> <C> <C>
1 year............................. $ 22.58 $ 22.27 $ 22.68
3 years............................ 69.92 68.69 69.93
5 years............................ 119.27 117.72 119.78
10 years........................... 255.81 252.68 256.85
</TABLE>
* In this example, the $30 annual certificate administrative charge is
approximated as a 0.045% charge based on our average certificate size.
YOU SHOULD NOT CONSIDER THIS EXAMPLE AS A REPRESENTATION OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.
7 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
CONDENSED FINANCIAL INFORMATION (UNAUDITED)
The following tables give per-unit information about the financial history of
each subaccount.
<TABLE>
<CAPTION>
Year ended Dec. 31,
----------------------------------------------------
1998 1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BAP(1) (INVESTING IN SHARES OF APPRECIATION PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.88 $1.51 $1.28 $1.01 $1.03 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $2.20 $1.88 $1.51 $1.28 $1.01 $1.03
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 2,641 3,082 3,249 3,536 3,267 2,093
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BDS(1) (INVESTING IN SHARES OF DIVERSIFIED STRATEGIC
INCOME PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.36 $1.28 $1.16 $1.02 $1.06 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.42 $1.36 $1.28 $1.16 $1.02 $1.06
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 1,507 1,841 2,397 2,704 2,866 2,055
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BEG(2) (INVESTING IN SHARES OF EMERGING GROWTH
PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.85 $1.55 $1.33 $0.95 $1.04 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $2.50 $1.85 $1.55 $1.33 $0.95 $1.04
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 486 582 635 727 706 148
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BEM(1) (INVESTING IN SHARES OF EQUITY INCOME
PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.50 $1.23 $1.18 $0.90 $1.02 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.73 $1.50 $1.23 $1.18 $0.90 $1.02
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 945 1,115 1,410 1,677 1,926 1,561
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BEX(1) (INVESTING IN SHARES OF EQUITY INDEX PORFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $2.14 $1.64 $1.37 $1.02 $1.03 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $2.71 $2.14 $1.64 $1.37 $1.02 $1.03
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 1,141 1,247 1,208 1,249 1,274 1,128
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BGI(1) (INVESTING IN SHARES OF GROWTH AND INCOME
PORFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.84 $1.52 $1.29 $1.00 $1.05 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $2.03 $1.84 $1.52 $1.29 $1.00 $1.05
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 1,554 1,709 1,764 1,819 1,820 1,335
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BIH(1) (INVESTING IN SHARES OF INTERMEDIATE HIGH GRADE
PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.22 $1.14 $1.14 $0.98 $1.03 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.29 $1.22 $1.14 $1.14 $0.98 $1.03
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 1,533 1,684 1,324 1,390 734 733
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BIE(2) (INVESTING IN SHARES OF INTERNATIONAL EQUITY
PORTOFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.12 $1.16 $0.97 $0.91 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.31 $1.12 $1.16 $0.97 $0.91 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 888 1,227 1,430 1,467 1,872 315
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
8 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year ended Dec. 31,
----------------------------------------------------
1998 1997 1996 1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SUBACCOUNT BMO(1) (INVESTING IN SHARES OF MONEY MARKET PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.13 $1.10 $1.07 $1.03 $1.01 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.16 $1.13 $1.10 $1.07 $1.03 $1.01
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 458 460 343 395 539 450
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
Simple yield(4) 2.43% 3.05% 2.52% 2.75% 2.14% .70%
- -----------------------------------------------------------------------------------------------------------------------
Compound yield(4) 2.46% 3.09% 2.55% 2.79% 2.16% .70%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BTR(2) (INVESTING IN SHARES OF TOTAL RETURN PORTFOLIO)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.91 $1.66 $1.34 $1.09 $1.03 $1.00
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.97 $1.91 $1.66 $1.34 $1.09 $1.03
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 1,206 1,430 1,396 1,401 975 211
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BCR(3) (INVESTING IN SHARES OF IDS LIFE CAPITAL
RESOURCE FUND)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.47 $1.20 $1.13 $1.01 $1.00 --
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.79 $1.47 $1.20 $1.13 $1.01 --
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 14 13 13 -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% --
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BMG(3) (INVESTING IN SHARES OF IDS LIFE MANAGED FUND,
INC.)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.64 $1.39 $1.21 $0.99 $1.00 --
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.87 $1.64 $1.39 $1.21 $0.99 --
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) -- -- 12 -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% --
- -----------------------------------------------------------------------------------------------------------------------
SUBACCOUNT BSI(3) (INVESTING IN SHARES OF IDS LIFE SPECIAL INCOME
FUND)
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at beginning of period $1.12 $1.09 $1.12 $0.99 $1.00 --
- -----------------------------------------------------------------------------------------------------------------------
Accumulation unit value at end of period $1.12 $1.12 $1.09 $1.12 $0.99 --
- -----------------------------------------------------------------------------------------------------------------------
Number of accumulation units outstanding at end of period (000
omitted) 15 13 -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Ratio of operating expense to average net assets 1.50% 1.50% 1.50% 1.50% 1.50% --
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
1 Operations commenced on March 15, 1993.
2 Operations commenced on Dec. 2, 1993.
3 Operations commenced on Nov. 28, 1994. BCR, BSI, and BMG had no activity in
1995. BSI had no activity in 1996. BMG had no activity in 1998 and 1997.
4 Net of annual certificate administrative charge and mortality and expense
risk fee.
9 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
FINANCIAL STATEMENTS
You can find our audited financial statements and the audited financial
statements of the subaccounts in the SAI.
- --------------------------------------------------------------------------------
PERFORMANCE INFORMATION
Performance information for the subaccounts may appear from time to time in
advertisements or sales literature. This information reflects the performance of
a hypothetical investment in a particular subaccount during a specified time
period. Although we will base performance figures on historical earnings, past
performance does not guarantee future results.
We include non-recurring charges (such as surrender charges) in total return
figures, but not in yield quotations. Excluding non-recurring charges in yield
calculations increases the reported value.
Total return figures reflect deduction of all applicable charges, including:
- - the certificate administrative charge,
- - variable account administrative charge,
- - mortality and expense risk fee, and
- - surrender charge (assuming a surrender at the end of the illustrated period).
We also may make optional total return quotations that do not reflect a
surrender charge deduction (assuming no surrender). Total return quotations may
be shown by means of schedules, charts or graphs.
AVERAGE ANNUAL TOTAL RETURN is the average annual compounded rate of return of
the investment over a period of one, five and 10 years (or up to the life of the
variable subaccount if it is less than ten years old).
CUMULATIVE TOTAL RETURN is the cumulative change in the value of an investment
over a specified time period. We assume that income earned by the investment is
reinvested. Cumulative total return will be higher than average annual total
return because it is not averaged.
ANNUALIZED SIMPLE YIELD (FOR SUBACCOUNTS INVESTING IN MONEY MARKET
FUNDS) "annualizes" the income generated by the investment over a given
seven-day period. That is, we assume the amount of income generated by the
investment during the period will be generated each seven-day period for a year.
We show this as a percentage of the investment.
ANNUALIZED COMPOUND YIELD (FOR SUBACCOUNTS INVESTING IN MONEY MARKET FUNDS) is
calculated like simple yield except that we assume the income is reinvested when
we annualize it. Compound yield will be higher than the simple yield because of
the compounding effect of the assumed reinvestment.
ANNUALIZED YIELD (FOR SUBACCOUNTS INVESTING IN INCOME FUNDS) divides the net
investment income (income less expenses) for each accumulation unit during a
given 30-day period by the value of the unit on the last day of the period. We
then convert the result to an annual percentage.
You should consider performance information in light of the investment
objectives, policies, characteristics and quality of the fund in which the
subaccount invests and the market conditions during the specified time period.
Advertised yields and total return figures include charges that reduce
advertised performance. Therefore, you should not compare subaccount performance
to that of mutual funds that sell their shares directly to the public. (See the
SAI for a further description of methods used to determine total return and
yield.)
If you would like additional information about actual performance, please
contact us at the address or telephone number on page one of this prospectus.
10 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
THE VARIABLE ACCOUNT
You may allocate payments to any or all the subaccounts of the variable account
that invest in shares of the following funds:
<TABLE>
<CAPTION>
SUBACCOUNT INVESTING IN:
- --------------- ----------------------------------------
<S> <C>
BAP Appreciation Portfolio
BDS Diversified Strategic Income Portfolio
BEG Emerging Growth Portfolio
BEM Equity Income Portfolio
BEX Equity Index Portfolio
BGI Growth & Income Portfolio
BCG IDS Life Capital Resource Fund
BMG IDS Life Managed Fund
BSI IDS Life Special Income Fund
BIH Intermediate High Grade Portfolio
BIE International Equity Portfolio
BMO Money Market Portfolio
BTR Total Return Portfolio
</TABLE>
The variable account meets the definition of a separate account under federal
securities laws. We credit or charge income, capital gains and capital losses of
each subaccount only to that subaccount. State insurance law prohibits us from
charging a subaccount with liabilities of any other subaccount or of our general
business.
The U.S. Treasury and the Internal Revenue Service (IRS) indicated that they may
provide additional guidance on investment control. This concerns how many
variable subaccounts an insurance company may offer and how many exchanges among
subaccounts it may allow before the certificate owner would be currently taxed
on income earned within subaccount assets. At this time, we do not know what the
additional guidance will be or when action will be taken. We reserve the right
to modify the certificate, as necessary, so that the owner will not be subject
to current taxation as the owner of the subaccount assets.
We intend to comply with all federal tax laws so that each certificate continues
to qualify as an annuity for federal income tax purposes. We reserve the right
to modify the certificate as necessary to comply with any new tax laws.
The variable account was established under New York law on October 8, 1991. On
Oct. 14, 1993 the name of the variable account was changed from IDS Life of New
York Account SLB to IDS Life of New York Account SBS. The subaccounts are
registered together as a single unit investment trust under the Investment
Company Act of 1940 (the 1940 Act). This registration does not involve any
supervision of our management or investment practices and policies by the SEC.
All obligations arising under the certificates are general obligations of IDS
Life of New York.
- --------------------------------------------------------------------------------
THE FUNDS
APPRECIATION PORTFOLIO
Objective: long-term appreciation of capital. The Portfolio invests primarily in
equity and equity-related securities that are believed to afford attractive
opportunities for appreciation.
DIVERSIFIED STRATEGIC INCOME PORTFOLIO
Objective: high current income. The Portfolio allocates and reallocates its
assets primarily among three types of fixed-income securities -- U.S. securities
and mortgage-related securities, foreign government securities and corporate
securities rated below investment grade (commonly known as junk bonds). See the
section of the Greenwich Street Series Fund's prospectus entitled "Below
investment grade corporate fixed income securities" for further information on
these bonds.
11 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
EMERGING GROWTH PORTFOLIO
Objective: capital appreciation. The Portfolio invests at least 65% of its total
assets in common stocks of small- and medium-sized companies (both domestic and
foreign) in the early stages of their life cycle, that its investment adviser
believes have the potential to become major enterprises.
EQUITY INCOME PORTFOLIO
Objective: current income. Long-term capital appreciation is a secondary goal.
The Portfolio invests principally in dividend-paying common stocks of companies
whose prospects for dividend growth and capital appreciation are considered
favorable, concentrating at least 25% of its assets in the utility industry.
EQUITY INDEX PORTFOLIO
Objective: provide investment results that, before deduction of operating
expenses, match the price and yield performance of U.S. publicly traded common
stocks, as measured by the S&P 500 Index. Once the Portfolio reaches a
sufficient asset size, it will seek to achieve its goal by owning all 500 stocks
in the S&P 500 Index in proportion to their actual market capitalization
weightings.
GROWTH & INCOME PORTFOLIO
Objective: income and long-term capital growth. The Portfolio invests in
income-producing equity securities (including dividend-paying common stocks),
securities that are convertible into common stocks and warrants meeting certain
specified investment criteria.
IDS LIFE CAPITAL RESOURCE FUND
Objective: capital appreciation. Invests primarily in U.S. common stocks.
IDS LIFE MANAGED FUND
Objective: maximum total investment return through a combination of capital
growth and current income. Invests primarily in stocks, convertible securities,
bonds and money market instruments.
IDS LIFE SPECIAL INCOME FUND
Objective: high level of current income while conserving the value of the
investment for the longest time period. Invests primarily in investment-grade
bonds.
INTERMEDIATE HIGH GRADE PORTFOLIO
Objective: provide as high a level of current income as is consistent with the
protection of capital. The Portfolio invests (under normal market conditions)
substantially all, but not less than 65% of its assets in U.S. government
securities and in high-grade corporate bonds of U.S. issuers (i.e., bonds rated
within the three highest rating categories by Moody's Investors Service, Inc. or
Standard & Poor's Ratings Group or, if not rated, bonds believed to be of
comparable quality).
INTERNATIONAL EQUITY PORTFOLIO
Objective: provide a total return on assets from growth of capital and income.
The Portfolio invests (under normal market conditions) at least 65% of its
assets in a diversified portfolio of equity securities of established non-United
States issuers.
MONEY MARKET PORTFOLIO
Objective: maximum current income to the extent consistent with the preservation
of capital and the maintenance of liquidity. The Portfolio invests in short-term
money market instruments deemed to present minimal credit risks and considered
to be "Eligible Securities" as defined by the SEC.
TOTAL RETURN PORTFOLIO
Objective: provide shareholders with total return, consisting of long-term
capital appreciation and income. The Portfolio primarily invests in a
diversified portfolio of dividend-paying common stocks.
12 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
The investment objectives and policies of some of the funds are similar to the
investment objectives and policies of other mutual funds that the investment
advisor or its affiliates manage. Although the objectives and policies may be
similar, each fund will have its own portfolio holdings and its own fees and
expenses. Accordingly, each fund will have its own investment results.
All funds are available to serve as the underlying investments for variable
annuities. Some funds also are available to serve as investment options for
variable life insurance policies and qualified plans. It is possible that in the
future, it may be disadvantageous for variable annuity accounts and variable
life insurance accounts and/or qualified plans to invest in the available funds
simultaneously.
Although the insurance company and the funds do not currently foresee any such
disadvantages, the boards of directors or trustees of the appropriate funds will
monitor events in order to identify any material conflicts between annuity
owners, policy owners and qualified plans and to determine what action, if any,
should be taken in response to a conflict. If a board were to conclude that it
should establish separate funds for the variable annuity, variable life
insurance and qualified plan accounts, you would not bear any expenses
associated with establishing separate funds. Please refer to the fund
prospectuses for risk disclosure regarding simultaneous investments by variable
annuity, variable life insurance and qualified plan accounts.
The IRS issued final regulations relating to the diversification requirements
under Section 817(h) of the Internal Revenue Code of 1986, as amended (the
Code). Each fund intends to comply with these requirements.
The investment advisors or managers for the funds are as follows:
- - Appreciation Portfolio -- SSBC Fund Management Inc. (SSBC).
- - Diversified Strategic Income Portfolio -- SSBC. Smith Barney Global Capital
Management, Inc. serves as sub-investment advisor.
- - Emerging Growth Portfolio -- Van Kampen Asset Management, Inc.
- - Equity Income Portfolio -- SSBC.
- - Equity Index Portfolio -- Travelers Investment Management Company.
- - Growth & Income Portfolio -- SSBC.
- - IDS Life Retirement Annuity Mutual Funds -- IDS Life. AEFC is the investment
advisor for the IDS Life Retirement Annuity Mutual Funds. American Express
Asset Management International, Inc., a wholly-owned subsidiary of AEFC, is
the sub-investment advisor for IDS Life International Equity Fund.
- - Intermediate High Grade Portfolio -- SSBC.
- - International Equity Portfolio -- SSBC.
- - Money Market Portfolio -- SSBC.
- - Total Return Portfolio -- SSBC and Davis Skaggs Investment Management, a
division of SSBC.
The investment managers and advisors cannot guarantee that the funds will meet
their investment objectives. Please read the funds' prospectuses for facts you
should know before investing. These prospectuses are available by contacting us
at the address or telephone number on page one of this prospectus.
13 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
THE FIXED ACCOUNT
You also may allocate purchase payments to the fixed account. We back the
principal and interest guarantees relating to the fixed account. The value of
the fixed account increases as we credit interest to the account. Purchase
payments and transfers to the fixed account become part of our general account,
the company's main portfolio of investments. We credit and compound interest
daily to produce an effective annual interest rate. We will change the interest
rate from time to time at our discretion.
Interests in the fixed account are not required to be registered with the SEC.
The SEC staff does not review the disclosures in this prospectus on the fixed
account. Disclosures regarding the fixed account, however, may be subject to
certain generally applicable provisions of the federal securities laws relating
to the accuracy and completeness of statements made in prospectuses. (See
"Making the Most of Your Certificate -- Transfer policies" for restrictions on
transfers involving the fixed account.)
- --------------------------------------------------------------------------------
BUYING YOUR CERTIFICATE
Your financial consultant will help you prepare and submit your application, and
send it along with your initial purchase payment to our office. As the owner,
you have all rights and may receive all benefits under the certificate. You can
own a nonqualified annuity in joint tenancy with rights of survivorship only in
spousal situations. You cannot own a qualified annuity in joint tenancy. You can
buy a nonqualified annuity or become an annuitant if you are age 75 or younger.
You can buy a qualified annuity or become an annuitant if you are age 65 or
younger. When you apply, you may select:
- - the fixed account and/or the subaccounts in which you want to invest, and
- - how you wish to make purchase payments.
If your application is complete, we will process it and apply your purchase
payment to the fixed account and subaccounts you selected within two business
days after we receive it at our office. If we accept your application, we will
send you a contract. If we cannot accept your application within five business
days, we will decline it and return your payment. We will credit additional
purchase payments you make to your accounts on the valuation date we receive
them. We will value the additional payments at the next accumulation unit value
calculated after we receive your payments at our office.
THE RETIREMENT DATE
Annuity payouts are to begin on the retirement date. You can align this date
with your actual retirement from a job, or it can be a different future date,
depending on your needs and goals and on certain restrictions. You also can
change the date, provided you send us written instructions at least 30 days
before annuity payouts begin.
FOR NONQUALIFIED ANNUITIES, the retirement date must be:
- - no later than the annuitant's 85th birthday or 10 years after issue, whichever
is later.
FOR QUALIFIED ANNUITIES, to avoid IRS penalty taxes, retirement payments
generally must be:
- - on or after the annuitant turns 59 1/2; and
- - for IRAs, by April 1 of the year following the calendar year when the
annuitant reaches age 70 1/2; or
- -for all other qualified annuities by April 1 of the year which the annuitant
reaches age 70 1/2; or the calendar year when the annuitant retires.
14 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
However, in no case can the retirement date be later than the annuitant's 85th
birthday or 10 years after issue, whichever is later.
BENEFICIARY
If death benefits become payable before the retirement date (while this
certificate is in force and before annuity payouts begin), we will pay your
named beneficiary all or part of the certificate value. If there is no
beneficiary, then your estate will be the beneficiary. (See "Benefits in case of
death" for more about beneficiaries.)
PURCHASE PAYMENT AMOUNTS
INITIAL PURCHASE PAYMENT:
<TABLE>
<S> <C> <C>
Nonqualified: $ 5,000
Qualified: $ 500
- - Minimum additional purchase payment:
Nonqualified: $ 500
Qualified: $ 50
</TABLE>
MAXIMUM FIRST YEAR PURCHASE PAYMENTS**: $1 million
- - Maximum purchase payment for each subsequent year **: $1 million
** We reserve the right to change maximum limits. For qualified annuities the
qualified plans on the Code's limits on annual contributions also apply.
HOW TO MAKE PURCHASE PAYMENTS
BY LETTER
Send your check along with your name and contract number to:
REGULAR MAIL:
IDS Life Insurance Company of New York
Box 5144
Albany, NY 12205
EXPRESS MAIL:
IDS Life Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
15 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
- ------------------------------------------------------------------
CHARGES
CERTIFICATE ADMINISTRATIVE CHARGE
We charge this fee for establishing and maintaining your records. We deduct $30
from the certificate value on your certificate anniversary at the end of each
certificate year. We prorate this charge among the subaccounts and the fixed
account in the same proportion your interest in each account bears to your total
certificate value. If you fully surrender your certificate, we will deduct a
reduced certificate administrative charge that is prorated based on the number
of days from your last certificate anniversary to the date of full surrender. We
cannot increase the annual certificate administrative charge and it does not
apply after annuity payouts begin or when we pay death benefits.
VARIABLE ACCOUNT ADMINISTRATIVE CHARGE
We charge this fee daily to the subaccounts. The unit values of your subaccounts
reflect this fee and it totals 0.25% of their average daily net assets on an
annual basis. It covers certain administrative and operating expenses of the
subaccounts such as accounting, legal and data processing fees and expenses
involved in the preparation and distribution of reports and prospectuses. We
cannot increase the variable account administrative charge. It does not apply to
values allocated to the fixed account and it does not apply after annuity
payouts begin.
MORTALITY AND EXPENSE RISK FEE
We charge this fee daily to the subaccounts. The unit values of your subaccounts
reflect this fee and it totals 1.25% of their average daily net assets on an
annual basis. This fee covers the mortality and expense risk that we assume.
Approximately two-thirds of this amount is for assumption of the mortality risk,
and one-third is for our assumption of the expense risk. This fee does not apply
to the fixed account.
Mortality risk arises because of our guarantee to pay a death benefit and our
guarantee to make annuity payments according to the terms of the certificate no
matter how long a specific annuitant lives and no matter how long our entire
group of annuitants live. If, as a group, annuitants outlive the life expectancy
we assumed in the actuarial tables, we must take money from our general assets
to meet our obligations. If, as a group, annuitants do not live as long as
expected, we could profit from the mortality risk fee.
Expense risk arises because we cannot increase the certificate administrative
charge or variable account administrative charge and these charges may not cover
our expenses. We would have to make up any deficit from our general assets.
The subaccounts pay us the mortality and expense risk fee they accrued as
follows:
- - first, to the extent possible, the subaccounts pay this fee from any dividends
distributed from the funds in which they invest;
- - then, if necessary, the funds redeem shares to cover any remaining fees
payable.
We may use any profits we realize from the subaccounts' payment to us of the
mortality and expense risk fee for any proper corporate purpose, including,
among others, payment of distribution (selling) expenses. We do not expect that
the surrender charge, discussed in the following paragraphs, will cover sales
and distribution expenses.
SURRENDER CHARGE
If you surrender part or all of your certificate, you may be subject to a
surrender charge. A surrender charge applies if all or part of the certificate
value is surrendered during the first six payment years following a purchase
payment. The surrender charge starts at 6% of a purchase payment in the first
payment year and is reduced by 1% each payment year thereafter. This means that
there is no surrender charge after six payment years. In addition, there is no
surrender charge when certificate values are applied to a retirement payment
plan or for a death benefit. The surrender charge is used to help defray
expenses incurred in the sale of the certificate including commissions and other
promotional or distribution expenses associated with the printing and
distribution of prospectuses and sales material. After the first certificate
year, you may surrender up to 10%
16 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
of your prior certificate anniversary value in one or more surrenders each
certificate year without incurring a surrender charge. The 10% free withdrawal
provision is subject to other Annuity provisions and terms including those on
partial surrenders.
In addition, after the first certificate year there is no surrender charge on
certificate earnings, which equal:
- - the certificate value at the time of surrender; minus
- - the sum of all purchase payments received that have not been previously
surrendered; minus
- - the amount of the 10% free withdrawal, if applicable.
For purposes of determining the amount of any surrender charge, we deem
surrenders to be taken first from any applicable 10% free withdrawal amount;
next, from certificate earnings (in excess of any 10% free withdrawal amount);
and finally from purchase payments (on a first in-first out basis).
EXAMPLE OF SURRENDER CHARGE:
<TABLE>
<CAPTION>
ASSUMPTIONS:
<S> <C>
- -----------------------------------------------------------
Initial purchase payment at certificate issue date
of May 1, 1999.................................... $10,000
Subsequent purchase payment on July 1, 2002....... 20,000
Account value on certificate anniversary on April
29, 2003.......................................... 40,000
Account value on October 12, 2002................. 42,000
- -----------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
FULL SURRENDER ON OCTOBER 12, 2003:
- -------------------------------------------------------------------------------------------------------------
BASIS OF RATE OF DOLLAR AMOUNT
CHARGE SURRENDER CHARGE OF CHARGE EXPLANATION OF CHARGE
<C> <S> <C> <C>
10% of prior certificate anniversary certificate value
$ 4,000 None $ 0 surrendered free
$ 8,000 None $ 0 No charge on certificate earnings
Payment made in certificate year 1; surrendered at payment
$10,000 2% $ 200 year 5 rate
Payment made in certificate year 4; surrendered at payment
$20,000 5% $1,000 year 2 rate
- -------------------------------------------------------------------------------------------------------------
Total Surrender Charge: $1,200
</TABLE>
<TABLE>
<CAPTION>
PARTIAL SURRENDER OF $25,000 ON OCTOBER 12, 2003:
- -------------------------------------------------------------------------------------------------------------
BASIS OF RATE OF DOLLAR AMOUNT
CHARGE SURRENDER CHARGE OF CHARGE EXPLANATION OF CHARGE
<C> <S> <C> <C>
10% of prior certificate anniversary contract value
$ 4,000 None $ 0 surrendered free
$ 8,000 None $ 0 No charge on certificate earnings
Payment made in certificate year 1; surrendered at payment
$10,000 2% $200 year 5 rate
Payment made in certificate year 4; surrendered at payment
$ 3,000 5% $150 year 2 rate
- -------------------------------------------------------------------------------------------------------------
Total Surrender Charge: $350
</TABLE>
SURRENDER CHARGE ON PARTIAL SURRENDER -- For a partial surrender that is subject
to a surrender charge, the amount we actually surrender from your certificate
value will be the amount you request plus any applicable surrender charge. We
apply the surrender charge to this total amount. We pay the amount you
requested.
POSSIBLE REDUCTION IN CHARGES -- In some cases, we may incur lower sales and
administrative expenses or perform fewer services. In those cases, we may, at
our discretion, reduce or eliminate certain administrative and surrender
charges. However, we expect this to occur infrequently, if at all.
17 PROSPECTUS
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- --------------------------------------------------------------------------------
VALUING YOUR INVESTMENT
We value your fixed account and subaccounts as follows:
FIXED ACCOUNT: We value the amounts you allocated to the fixed account directly
in dollars. The fixed account value equals:
- - the sum of your purchase payments and transfer amounts allocated to the fixed
account;
- - plus interest credited;
- - minus the sum of amounts withdrawn (including any applicable surrender
charges) and amounts transferred out; and
- - minus any prorated certificate administrative charge.
SUBACCOUNTS: We convert amounts you allocated to the subaccounts into
accumulation units. Each time you make a purchase payment or transfer amounts
into one of the subaccounts, we credit a certain number of accumulation units to
your certificate for that subaccount. Conversely, each time you take a partial
withdrawal, transfer amounts out of a subaccount or we assess a certificate
administrative charge, we subtract a certain number of accumulation units from
your certificate.
The accumulation units are the true measure of investment value in each
subaccount during the accumulation period. They are related to, but not the same
as, the net asset value of the fund in which the subaccount invests.
The dollar value of each accumulation unit can rise or fall daily depending on
the subaccount expenses, performance of the fund and on certain fund expenses.
Here is how we calculate accumulation unit values:
NUMBER OF UNITS
To calculate the number of accumulation units for a particular subaccount, we
divide your investment after deduction by the current accumulation unit value.
ACCUMULATION UNIT VALUE
The current accumulation unit value for each subaccount equals the last value
times the subaccount's current net investment factor.
NET INVESTMENT FACTOR
We determine the net investment factor by:
- - adding the fund's current net asset value per share plus the per share amount
of any accrued income or capital gain dividends to obtain a current adjusted
net asset value per share; then
- - dividing that sum by the previous adjusted net asset value per share; and
- - subtracting the percentage factor representing the mortality and expense risk
fee and the variable account administrative charge from the result.
Because the net asset value of the fund may fluctuate, the accumulation unit
value may increase or decrease. You bear all the investment risk in a
subaccount.
18 PROSPECTUS
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FACTORS THAT AFFECT SUBACCOUNT ACCUMULATION UNITS
Accumulation units may change in two ways: in number and in value. Here are the
factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
- - additional purchase payments you allocate to the subaccounts;
- - transfers into or out of the subaccounts;
- - partial withdrawals;
- - surrender charges; and/or
- - prorated portions of the certificate administrative charge.
Accumulation unit values will fluctuate due to:
- - changes in funds' net asset value;
- - dividends distributed to the subaccounts;
- - capital gains or losses of funds;
- - fund operating expenses;
- - mortality and expense risk fees; and/or
- - variable account administrative charges.
- --------------------------------------------------------------------------------
MAKING THE MOST OF YOUR CERTIFICATE
TRANSFERRING MONEY BETWEEN ACCOUNTS
You may transfer money from any one subaccount, or the fixed account, to another
subaccount before annuity payouts begin. (Certain restrictions apply to
transfers involving the fixed account.) We will process your transfer on the
valuation date we receive your request. We will value your transfer at the next
accumulation unit value calculated after we receive your request. There is no
charge for transfers. Before making a transfer, you should consider the risks
involved in switching investments.
We may suspend or modify transfer privileges at any time.
TRANSFER POLICIES
- - You may transfer certificate values between the subaccounts or from the
subaccounts to the fixed account at any time. However, if you made a transfer
from the fixed account to the subaccounts, you may not make a transfer from
any subaccount back to the fixed account for six months following that
transfer.
- - You may transfer between the subaccounts and the fixed account up to the six
times per certificate year. This limit may be waived if the automated transfer
of certificate value is in effect.
HOW TO REQUEST A TRANSFER OR SURRENDER
1 BY LETTER:
Send your name, certificate number, Social Security Number or Taxpayer
Identification Number and signed request for a transfer or surrender to:
REGULAR MAIL:
IDS Life Insurance Company of New York
Box 5144
Albany, NY 12205
19 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
EXPRESS MAIL:
IDS Life Insurance Company of New York
20 Madison Ave. Extension
Albany, NY 12203
<TABLE>
<S> <C> <C>
MINIMUM AMOUNT
Transfers: $500 or entire account balance
(If a partial surrender would reduce the account balance to less than
$500, we either cannot make the surrender or we must surrender the full
account value.)
Surrenders: $500
MAXIMUM AMOUNT
Transfers or surrenders: Certificate value
</TABLE>
2 BY AUTOMATED TRANSFERS AND AUTOMATED PARTIAL SURRENDERS
Your financial consultant can help you set up automated transfers among your
subaccounts or fixed account or partial surrenders from the accounts.
You can start or stop this service by written request or other method acceptable
to us. You must allow 30 days for us to change any instructions that are
currently in place.
- - Automated transfers from the fixed account to the subaccounts may not exceed
an amount that, if continued, would deplete the fixed account within 12
months.
- - Automated transfers and automated partial surrenders are subject to all of the
certificate provisions and terms, including transfer of certificate values
between accounts.
- - Automated partial surrenders may result in IRS taxes and penalties on all or
part of the amount surrendered.
<TABLE>
<S> <C> <C>
MINIMUM AMOUNT
Transfers: $100
(If a partial surrender wouldreduce the account balance to less than
$500, you either cannot make the surrender or you must surrender the
full account value.)
Surrenders: $500
</TABLE>
3 BY PHONE
Call between 8 a.m. and 4:30 p.m. Eastern time:
1-800-336-3646 (toll free)
<TABLE>
<S> <C> <C>
MINIMUM AMOUNT
Transfers: $500 or entire account balance
(If a partial surrender wouldreduce the account balance to less than
$500, you either cannot make the surrender or you must surrender the
full account value.)
Surrenders: $500
MAXIMUM AMOUNT
Transfers: Certificate value
Surrenders: $40,000
</TABLE>
We answer telephone requests promptly, but you may experience delays when the
call volume is unusually high. If you are unable to get through, use the mail
procedure as an alternative.
We will honor any telephone transfer or surrender requests that we believe are
authentic and we will use reasonable procedures to confirm that they are. This
includes asking identifying questions and tape recording calls. We will not
allow a telephone surrender within 30 days of a phoned-in address change. As
long as we follow the procedures, we (and our affiliates) will not be liable for
any loss resulting from fraudulent requests.
Telephone transfers or surrenders are automatically available. You may request
that telephone transfers or surrenders NOT be authorized from your account by
writing to us.
20 PROSPECTUS
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- --------------------------------------------------------------------------------
4 BY SYSTEMATIC WITHDRAWALS
You may start or stop this service by written request or other method acceptable
to us. You must allow 30 days' notice for us to change any instructions that are
currently in place.
You may withdraw amounts of up to 10 percent of the certificate value at the
beginning of the certificate year. We will not deduct surrender charges for
first-year systematic withdrawals of amounts up to 10 percent of the initial
purchase payment. Systematic withdrawals may result in IRS taxes and penalties
on all or part of the amount withdrawn. You should consult your tax advisor
regarding the tax consequences of systematic withdrawals.
You may designate withdrawals from the certificate in one of the following ways:
- - withdrawing a specific total dollar amount prorated from all accounts in which
you have a balance (if no other choice is made, we will withdraw amounts under
this method);
- - withdrawing a specific total dollar amount and specifying which percentage of
that total amount will be withdrawn from all accounts in which you have a
balance; or
- - withdrawing only the interest credited to the fixed account over the
systematic withdrawal period.
<TABLE>
<S> <C> <C>
MINIMUM CERTIFICATE VALUE $5,000
MINIMUM SYSTEMATIC WITHDRAWAL AMOUNT $ 100
</TABLE>
- --------------------------------------------------------------------------------
SURRENDERS
You may surrender all or part of your certificate at any time before annuity
payouts begin by sending us a written request or calling us. We will process
your surrender request on the valuation date we receive it. We will compute the
value of your certificate at the next accumulation unit value calculated after
we receive your request. For total surrenders we may ask you to return the
certificate. You may have to pay surrender charges (see "Charges") and IRS taxes
and penalties (see "Taxes"). You cannot make surrenders after annuity payouts
begin.
SURRENDER POLICIES
If you have a balance in more than one account and you request a partial
surrender, we will withdraw money from all your subaccounts and/or the fixed
account in the same proportion as your value in each account correlates to your
total certificate value, unless you request otherwise.
RECEIVING PAYMENT
By regular or express mail:
- - payable to you.
- - mailed to address of record within seven days after receiving your request.
However, we may postpone the payment if:
-- the surrender amount includes a purchase payment check that has not
cleared;
-- the NYSE is closed, except for normal holiday and weekend closings;
-- trading on the NYSE is restricted, according to SEC rules;
-- an emergency, as defined by SEC rules, makes it impractical to sell
securities or value the net assets of the accounts; or
-- the SEC permits us to delay payment for the protection of security holders.
NOTE: We will charge you a fee if you request express mail delivery.
21 PROSPECTUS
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SYMPHONY ANNUITY
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TSA -- SPECIAL SURRENDER PROVISIONS
Participants in tax-sheltered annuities: The Code imposes certain restrictions
on your right to receive early distributions from a TSA:
- -Distributions attributable to salary reduction contributions (plus earnings)
made after Dec. 31, 1988, or to transfers or rollovers from other contracts,
may be made from the TSA only if:
-- you are at least age 59 1/2;
-- you are disabled as defined in the Code;
-- you separated from the service of the employer who purchased the
certificate; or
-- the distribution is because of your death.
- - If you encounter a financial hardship (as defined by the Code), you may
receive a distribution of all certificate values attributable to salary
reduction contributions made after Dec. 31, 1988, but not the earnings on
them.
- - Even though a distribution may be permitted under the above rules, it may be
subject to IRS taxes and penalties (see "Taxes").
- - The employer must comply with certain nondiscrimination requirements for
certain types of contributions under a TSA certificate to be excluded from
taxable income. You should consult your employer to determine whether the
nondiscrimination rules apply to you.
- - The above restrictions on distributions do not affect the availability of the
amount credited to the certificate as of Dec. 31, 1988. The restrictions also
do not apply to transfers or exchanges of certificate value within the
certificate, or to another registered variable annuity contract or investment
vehicle available through the employer.
- --------------------------------------------------------------------------------
CHANGING OWNERSHIP
You may change ownership of your nonqualified annuity at any time by completing
a change of ownership form we approve and sending it to our office. The change
will become binding upon us when we receive and record it. We will honor any
change of ownership request that we believe is authentic and we will use
reasonable procedures to confirm authenticity. If we follow these procedures, we
will not take any responsibility for the validity of the change.
If you have a nonqualified annuity, you may incur income tax liability by
transferring, assigning or pledging any part of it. (See "Taxes.")
If you have a qualified annuity, you may not sell, assign, transfer, discount or
pledge your certificate as collateral for a loan, or as security for the
performance of an obligation or for any other purpose except as required or
permitted by the Code.
BENEFITS IN CASE OF DEATH
If you or the annuitant die before the retirement date while the certificate is
in force we will pay the beneficiary as follows:
Before the initial fifth certificate anniversary, the beneficiary receives the
greater of:
- - the certificate value; or
- - the amount of purchase payments (minus any surrenders).
On or after the initial fifth certificate anniversary, and each subsequent fifth
certificate anniversary, the beneficiary receives the greater of:
- - the certificate value; or
22 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
- -a minimum guaranteed death benefit which equals:
-- the death benefit calculated as of the previous fifth certificate
anniversary;
-- plus any purchase payments made since the previous fifth certificate
anniversary;
-- minus any surrenders since the previous fifth certificate anniversary.
If a certificate has more than one person as owner, we will pay benefits upon
the first to die of any owner or the annuitant.
IF YOUR SPOUSE IS SOLE BENEFICIARY under a nonqualified annuity and you die
before the retirement date, your spouse may keep the certificate as owner. To do
this your spouse must, within 60 days after we receive proof of death, give us
written instructions to keep the certificate in force.
Under a qualified annuity, if the annuitant dies before the Code requires
distributions to begin, and the spouse is the only beneficiary, the spouse may
keep the annuity as owner until the date on which the annuitant would have
reached 70 1/2 or any other date permitted by the Code. To do this, the spouse
must give us written instructions within 60 days after we receive proof of
death.
PAYMENTS: Under a nonqualified annuity we will pay the beneficiary in a single
sum unless you give us other written instructions. We must fully distribute the
death benefit within five years of your death. However, the beneficiary may
receive payouts under any annuity payout plan available under this contract if:
- - the beneficiary asks us in writing within 60 days after we receive proof of
death; and
- - payouts begin no later than one year after your death, or other date as
permitted by the Code; and
- - the payout period does not extend beyond the beneficiary's life or life
expectancy.
When paying the beneficiary, we will process the death claim on the valuation
date our death claim requirements are fulfilled. We will determine the
certificate's value at the next accumulation unit value calculated after our
death claim requirements are fulfilled. We will pay interest, if any, from the
date of death at a rate no less than required by law. We will mail payment to
the beneficiary within seven days after our death claim requirements are
fulfilled. Other rules may apply to qualified annuities. (see "Taxes").
- --------------------------------------------------------------------------------
THE ANNUITY PAYOUT PERIOD
The amount available on the retirement date to provide payments under a
retirement payment plan is the current value of your investment, called the
contract value. Because Portfolio or Fund investments (other than those in the
Money Market Portfolio) fluctuate in value each day, there can be no guarantee
that the certificate value will exceed, or even equal, the amount of your
purchase payments. You will receive quarterly statements showing your
certificate value and any other information required by applicable law at least
annually.
On your retirement date, the certificate value is applied to our current fixed
table of settlement rates, which will be at least as favorable as that contained
in the certificate.
We then calculate lifetime annuity payments according to the retirement payment
plan you choose.
A unisex table of settlement rates will apply, except when the certificate is
used to fund an IRA or a nonqualified plan.
23 PROSPECTUS
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SYMPHONY ANNUITY
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PAYOUT OPTIONS AT RETIREMENT
As the owner of the certificate, you have the right to decide how we will make
retirement payments. You may select one of the retirement payment plans outlined
below, or we may mutually agree on other payment arrangements. We will make
annuity payments on a fixed basis. A fixed annuity is one with payments that are
guaranteed by us as to dollar amount. Fixed annuity payments after the first
payment will never be less than the first payment.
RETIREMENT PAYMENT PLANS -- You may choose any one of these payment plans by
giving us written instructions at least 30 days before the retirement date:
- - PLAN A - LIFE ANNUITY - NO REFUND -- We make monthly payments until the
annuitant's death. Payments end with the last monthly payment before the
annuitant's death. We will not make any further payments. You should understand
that if the annuitant dies after only the first monthly payment, we will not
make any more payments.
- - PLAN B - LIFE ANNUITY WITH 5, 10 OR 15 YEARS CERTAIN -- We make monthly
payments until the annuitant's death. However, payments are guaranteed for 5, 10
or 15 years. If the annuitant dies before all guaranteed payments have been
made, we will continue making those guaranteed payments to you, if living; if
not, to your beneficiary; or, if no beneficiary is named, to your estate.
- - PLAN C - LIFE ANNUITY - INSTALLMENT REFUND -- We make monthly payments until
the annuitant's death. However, payments are guaranteed to continue for at least
the number of months determined by dividing the certificate value at the time of
retirement by the amount of the monthly payment. If the annuitant dies before
all guaranteed payments have been made, we will continue making those guaranteed
payments to you, if living; if not, to your beneficiary; or, if no beneficiary
is named, to your estate.
- - PLAN D - JOINT AND LAST SURVIVOR LIFE ANNUITY - NO REFUND -- We make monthly
payments while both the annuitant and a joint annuitant are living. If either
annuitant dies, we will continue to make monthly payments at the full amount
until the death of the surviving annuitant. Payments end with the death of the
second annuitant, and we will make no further payments. You should understand
that if both the annuitant and the joint annuitant die after only the first
monthly payment, we will make no further payments.
- - PLAN E - PERIOD CERTAIN ANNUITY -- We make monthly payments for a period of
years that you elect. The period of years may be no less than 10 years and no
more than 30 years. Even if the annuitant lives beyond the period of years
selected, we will make no further payments. However, if the annuitant dies
before the end of the period selected, we will continue making monthly payments
to you, if living; if not, to your beneficiary; or, if no beneficiary is named,
to your estate.
RESTRICTIONS FOR SOME QUALIFIED PLANS -- If you purchased a qualified annuity in
connection with a Section 401(k) plan, custodial or trusteed plan, or as an IRA
or TSA, you may be required to select a payment plan (in accordance with the
applicable provisions of the Code) that provides for payments:
- - over the life of the annuitant;
- - over the joint lives of the annuitant and beneficiary;
- - for a period not exceeding the life expectancy of the annuitant; or
- - for a period not exceeding the joint life expectancies of the annuitant and
beneficiary.
IF WE DO NOT RECEIVE INSTRUCTIONS -- You must give us written instructions for
paying retirement benefits at least 30 days before the retirement date. If you
do not, we will make payments under Plan B, with 120 monthly payments
guaranteed.
IF MONTHLY PAYMENTS WOULD BE LESS THAN $50 -- We will calculate your certificate
value at the retirement date. If the calculations show that monthly payments
would be less than $50, we reserve the right to change the frequency of the
retirement payments or to pay the certificate value in one lump sum.
24 PROSPECTUS
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SYMPHONY ANNUITY
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DEATH AFTER RETIREMENT PAYMENTS BEGIN -- If you or the annuitant die after
retirement payments begin, we will pay any amount payable to the beneficiary as
provided in the retirement payment plan in effect.
- --------------------------------------------------------------------------------
TAXES
Generally, under current law, any increase in your certificate value is taxable
to you only when you receive a payout or surrender (see detailed discussion
below). Any portion of the annuity payouts and any surrenders you request that
represent ordinary income are normally taxable. We will send you a tax
information reporting form for any year in which we made a taxable distribution
according to our records.
Adverse tax consequences may result if you do not ensure that contributions,
distributions and other transactions under the contract comply with the law.
Qualified annuities have minimum distribution rules that govern the timing and
amount of distributions during your life and after your death. You should refer
to our retirement plan or adoption agreement, or consult a tax advisor for more
information about these distribution rules.
QUALIFIED ANNUITIES: We designed this certificate for use with qualified
retirement plans. Special rules apply to these retirement plans. Your rights to
benefits may be subject to the terms and conditions of these retirement plans
regardless of the terms of the certificate.
ANNUITY PAYOUTS UNDER NONQUALIFIED ANNUITIES: A portion of each payout will be
ordinary income and subject to tax, and a portion of each payout will be
considered a return of part of your investment and will not be taxed. All
amounts you receive after your investment in the certificate is fully recovered
will be subject to tax.
Tax law requires that all nonqualified deferred annuity certificates issued by
the same company (and possibly its affiliates) to the same owner during a
calendar year be taxed as a single, unified certificate when you take
distributions from any one of those certificates.
ANNUITY PAYOUTS UNDER QUALIFIED ANNUITIES: Under a qualified annuity, the entire
payout generally is includable as ordinary income and is subject to tax except
to the extent that contributions were made with after-tax dollars. If you or
your employer invested in your certificate with deductible or pre-tax dollars as
part of a qualified retirement plan, such amounts are not considered to be part
of your investment in the certificate and will be taxed when paid to you.
SURRENDERS: If you surrender part or all of your certificate before your annuity
payouts begin, your surrender payment will be taxed to the extent that the value
of your certificate immediately before the surrender exceeds your investment.
You also may have to pay a 10% IRS penalty for surrenders you make before
reaching age 59 1/2 unless certain exceptions apply. For qualified annuities,
other penalties may apply if you surrender your certificate before your plan
specifies that you can receive payouts.
DEATH BENEFITS TO BENEFICIARIES: The death benefit under a certificate is not
tax-exempt. Any amount your beneficiary receives that represents previously
deferred earnings within the certificate is taxable as ordinary income to the
beneficiary in the years he or she receives the payments.
ANNUITIES OWNED BY CORPORATIONS, PARTNERSHIPS OR TRUSTS: For nonqualified
annuities any annual increase in the value of annuities held by such entities
generally will be treated as ordinary income received during that year. This
provision is effective for purchase payments made after Feb. 28, 1986. However,
if the trust was set up for the benefit of a natural person only, the income
will remain tax-deferred.
PENALTIES: If you receive amounts from your certificate before reaching age
59 1/2, you may have to pay a 10% IRS penalty on the amount includable in your
ordinary income. However, this penalty will not apply to any amount received by
you or your beneficiary:
- - because of your death;
- - because you become disabled (as defined in the Code);
25 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
- - if the distribution is part of a series of substantially equal periodic
payments, made at least annually, over your life or life expectancy (or joint
lives or life expectancies of you and your beneficiary); or
- - if it is allocable to an investment before Aug. 14, 1982 (except for qualified
annuities).
For a qualified annuity, other penalties or exceptions may apply if you
surrender your certificate before your plan specifies that payouts can be made.
WITHHOLDING, GENERALLY: If you receive all or part of the certificate value, we
may deduct withholding against the taxable income portion of the payment. Any
withholding represents a prepayment of your tax due for the year. You take
credit for these amounts on your annual tax return.
If the payment is part of an annuity payout plan, we generally compute the
amount of withholding using payroll tables. You may provide us with a statement
of how many exemptions to use in calculating the withholding. As long as you've
provided us with a valid Social Security Number or Taxpayer Identification
Number, you can elect not to have any withholding occur.
If the distribution is any other type of payment (such as a partial or full
surrender), we compute withholding using 10% of the taxable portion. Similar to
above, as long as you have provided us with a valid Social Security Number or
Taxpayer Identification Number, you can elect not to have this withholding
occur.
If you take a distribution from a certificate offered under a Section 457 plan
(deferred compensation plan of state and local governments and tax-exempt
organizations), we compute withholding using payroll methods, depending upon the
type of payment.
Some states also impose withholding requirements similar to the federal
withholding described above. If this should be the case, we may deduct state
withholding from any payment from which we deduct federal withholding. The
withholding requirements may differ if we are making payment to a non-U.S.
citizen or if we deliver the payment outside the United States.
WITHHOLDING FROM QUALIFIED ANNUITIES: If you receive directly all or part of the
certificate value from a qualified annuity (except an IRA, SEP, or Section 457
plan), mandatory 20% federal income tax withholding (and possible state income
tax withholding) generally will be imposed at the time the payout is made. This
mandatory withholding is in place of the elective withholding discussed above.
This mandatory withholding will not be imposed if:
- - instead of receiving the distribution check, you elect to have the
distribution rolled over directly to an IRA or another eligible plan;
- - the payout is one in a series of substantially equal periodic payouts, made at
least annually, over your life or life expectancy (or the joint lives or life
expectancies of you and your designated beneficiary) or over a specified
period of 10 years or more; or
- - the payout is a minimum distribution required under the Code.
Payments we make to a surviving spouse instead of being directly rolled over to
an IRA also may be subject to mandatory 20% income tax withholding.
State withholding also may be imposed on taxable distributions.
TRANSFER OF OWNERSHIP OF A NONQUALIFIED ANNUITY: If you transfer a nonqualified
annuity without receiving adequate consideration, the transfer is a gift and
also may be a surrender for federal income tax purposes. If the gift is a
currently taxable event for income tax purposes, the original owner will be
taxed on the amount of deferred earnings at the time of the transfer and also
may be subject to the 10% IRS penalty discussed earlier. In this case, the new
owner's investment in the certificate will be the value of the certificate at
the time of the transfer.
26 PROSPECTUS
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SYMPHONY ANNUITY
- --------------------------------------------------------------------------------
COLLATERAL ASSIGNMENT OF A NONQUALIFIED ANNUITY: If you collaterally assign or
pledge your certificate, earnings on purchase payments you made after Aug. 13,
1982 will be taxed to you like a surrender.
IMPORTANT: Our discussion of federal tax laws is based upon our understanding of
current interpretations of these laws. Federal tax laws or current
interpretations of them may change. For this reason and because tax consequences
are complex and highly individual and cannot always be anticipated, you should
consult a tax advisor if you have any questions about taxation of your
certificate.
TAX QUALIFICATION: We intend that the certificate qualify as an annuity for
federal income tax purposes. To that end, the provisions of the certificate are
to be interpreted to ensure or maintain such tax qualification, in spite of any
other provisions of the certificate. We reserve the right to amend the
certificate to reflect any clarifications that may be needed or are appropriate
to maintain such qualification or to conform the certificate to any applicable
changes in the tax qualification requirements. We will send you a copy of any
such amendment.
- --------------------------------------------------------------------------------
VOTING RIGHTS
As an owner with investments in the subaccounts, you may vote on important fund
policies. We will vote fund shares according to your instructions.
The number of votes you have is determined by applying your percentage interest
in each subaccount to the total number of votes allowed to the subaccount.
We calculate votes separately for each subaccount. We will send notice of these
meetings, proxy materials and a statement of the number of votes to which the
voter is entitled.
We will vote shares for which we have not received instructions in the same
proportion as the votes for which we have received instructions. We also will
vote the shares for which we have voting rights in the same proportion as the
votes for which we have received instructions.
- --------------------------------------------------------------------------------
ABOUT THE SERVICE PROVIDERS
PRINCIPAL UNDERWRITER
Salomon Smith Barney Inc., a Delaware Corporation, is the principal underwriter
for the contracts. Its offices are located at 388 Greenwich Street, New York, NY
10013. Salomon Smith Barney Inc. is a wholly-owned subsidiary of Smith Barney
and an indirect wholly-owned subsidiary of Travelers Group Inc. Travelers Group
Inc. is a diversified financial services holding company.
ISSUER
IDS Life of New York issues the certificates. IDS Life of New York is a
wholly-owned subsidiary of IDS Life, which is a wholly-owned subsidiary of AEFC.
AEFC is a wholly-owned subsidiary of American Express Company, a financial
services company headquartered in New York City.
IDS Life of New York is a stock life insurance company organized in 1972 under
the laws of the State of New York and is located at 20 Madison Avenue Extension,
Albany, New York 12203. Its mailing address is P.O. Box 5144, Albany, NY 12205.
IDS Life of New York conducts a conventional life insurance business in New
York.
IDS Life of New York pays total commissions of up to 7.0% of the total purchase
payments it receives on the certificate.
27 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
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LEGAL PROCEEDINGS
A number of lawsuits have been filed against life and health insurers in
jurisdictions in which we do business involving insurers' sales practices,
alleged agent misconduct, failure to properly supervise agents, and other
matters. We, like other life and health insurers, from time to time are involved
in such litigation. On October 13, 1998, an action entitled Richard W. and
Elizabeth J. Thoresen vs. American Express Financial Corporation, American
Centurion Life Assurance Company, American Enterprise Life Insurance Company,
American Partners Life Insurance Company, IDS Life Insurance Company and IDS
Life Insurance Company of New York was commenced in Minnesota state court. The
action was brought by individuals who purchased an annuity in a qualified plan.
They allege that the sale of annuities in tax-deferred contributory retirement
investment plans (e.g., IRAs) is never appropriate. The plaintiffs purport to
represent a class consisting of all persons who made similar purchases. The
plaintiffs seek damages in an unspecified amount. We also are defendants in
various other lawsuits. In our opinion, none of these lawsuits will have a
material adverse effect on our financial condition.
- --------------------------------------------------------------------------------
YEAR 2000
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of IDS Life of New York and
the variable account. IDS Life of New York and the variable account have no
computer systems of their own but is dependent upon the systems of AEFC and
certain other third parties.
A comprehensive review of AEFC's computer systems and business processes has
been conducted to identify the major systems that could be affected by the Year
2000 issue. Steps are being taken to resolve any potential problems including
modification to existing software and the purchase of new software. These
measures are scheduled to be completed and tested on a timely basis. AEFC's
target date for substantially completing corrective measures on business
critical systems was Dec. 31, 1998. Substantial testing of systems was targeted
for completion early in 1999. AEFC currently is on track with this schedule and
also is on track to finish the work on non-critical systems by June 30, 1999.
The Year 2000 readiness of other third parties whose system failures could have
an impact on IDS Life of New York's and the variable account's operations
continues to be evaluated. The potential materiality of any such impact is not
known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
28 PROSPECTUS
<PAGE>
SYMPHONY ANNUITY
TABLE OF CONTENTS OF THE STATEMENT
OF ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
Performance Information........................... 3
Calculating Annuity Payouts....................... 5
Rating Agencies................................... 5
Principal Underwriter............................. 6
Independent Auditors.............................. 6
Financial Statements
</TABLE>
- --------------------------------------------------------------------------------
29 PROSPECTUS
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SYMPHONY ANNUITY
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Please check the box to receive a copy of the Statement of
Additional Information:
/ / Symphony Annuity
/ / Greenwich Street Series Fund
/ / IDS Life Retirement Annuity Mutual Funds
MAIL YOUR REQUEST TO:
IDS Life Insurance Company of New York
20 Madison Avenue Extension
P.O. Box 5144
Albany, NY 12705
WE WILL MAIL YOUR REQUEST TO:
<TABLE>
<S> <C> <C>
Your name ---------------------
Address ---------------------
City --------------------- State ------- Zip -------
</TABLE>
31 PROSPECTUS
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SYMPHONY
- --------------------------------------------------------------------------------
IDS Life Insurance Company
Of New York
P.O. Box 5144
Albany, NY 12205
IN0800 S-6226 K (4/99)
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
for
SYMPHONY ANNUITY
IDS LIFE OF NEW YORK ACCOUNT SBS
April 30, 1999
IDS Life of New York Account SBS is a separate account established and
maintained by IDS Life Insurance Company of New York (IDS Life of New York).
This Statement of Additional Information (SAI) is not a prospectus. It should be
read together with the prospectus dated the same date as this SAI, which may be
obtained from your financial consultant, or by writing or calling us at the
address and telephone number below. The prospectus is incorporated in this SAI
by reference.
IDS Life of New York
20 Madison Avenue Extension
Albany, NY 12203
800-366-3446
<PAGE>
SYMPHONY ANNUITY-IDS LIFE OF NEW YORK ACCOUNT SBS
TABLE OF CONTENTS
Performance Information..........................................p.3
Calculating Annuity Payouts......................................p.5
Rating Agencies..................................................p.5
Principal Underwriter............................................p.6
Independent Auditors.............................................p.6
Financial Statements
<PAGE>
PERFORMANCE INFORMATION
- -------------------------------------------------------------------------------
The subaccounts may quote various performance figures to illustrate past
performance. We base total return and current yield quotations (if applicable)
on standardized methods of computing performance as required by the Securities
and Exchange Commission (SEC). An explanation of the methods used to compute
performance follows below.
Average Annual Total Return
We will express quotations of average annual total return for the subaccounts in
terms of the average annual compounded rate of return of a hypothetical
investment in the contract over a period of one, five and 10 years (or, if less,
up to the life of the variable subaccounts), calculated according to the
following formula:
P(1+T)n = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = Ending Redeemable Value of a hypothetical $1,000 payment
made at the beginning of the period, at the end of the
period (or fractional period thereof)
Cumulative Total Return
Aggregate total return represents the cumulative change in value of an
investment for a given period (reflecting change in a subaccount's accumulation
unit value). We compute aggregate total return using the following formula:
ERV - P
P
where: P = a hypothetical initial payment of $1,000
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the period, at the
end of the period (or fractional period thereof)
The SEC requires that we assume that you withdraw the entire certificate at the
end of the one-, five-, and 10- year periods (or, if less, up to the life of the
subaccount). In addition, we may show performance figures without the deduction
of a surrender charge. All total return figures reflect the deduction of all
applicable charges including the certificate administrative charge, the variable
account administrative charge and the mortality and expense risk fee.
<PAGE>
Annualized Calculation of Yield for Subaccounts Investing in Money Market Fund
Simple Yield:
For the subaccounts investing in the money market fund, we base quotations of
simple yield on:
(a) the change in the value of a hypothetical subaccount (exclusive of
capital changes and income other than investment income) at the
beginning of a particular seven-day period;
(b) less a pro rata share of the subaccount expenses accrued over the
period;
(c) dividing this difference by the value of the subaccount at the
beginning of the period to obtain the base period return; and
(d) multiplying the base period return by 365/7.
The subaccount's value includes:
o any declared dividends,
o the value of any shares purchased with dividends paid during the period, and
o any dividends declared for such shares.
It does not include:
o the effect of any applicable surrender charge, or o any realized or unrealized
gains or losses.
Annualized Compound Yield:
We calculate compound yield using the base period return described above, which
we then compound according to the following formula:
Compound Yield = [(Base Period Return + 1)365/7] -1
Annualized Yield for Subaccounts Investing in Income Funds
For the subaccounts investing in income funds, we base quotations of yield on
all investment income earned during a particular 30-day period, less expenses
accrued during the period (net investment income) and compute it by dividing net
investment income per accumulation unit by the value of an accumulation unit on
the last day of the period, according to the following formula:
YIELD = 2[( a-b + 1)6 - 1]
cd
where: a = dividends and investment income earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of accumulation units
outstanding during the period that were entitled to
receive dividends
d = the maximum offering price per accumulation unit on the
last day of the period
<PAGE>
The subaccount earns yield from the increase in the net asset value of shares of
the fund in which it invests and from dividends declared and paid by the fund,
which are automatically invested in shares of the fund.
Independent rating or statistical services or publishers or publications such as
those listed below may quote subaccount performance, compare it to rankings,
yields or returns, or use it in variable annuity accumulation or settlement
illustrations they publish or prepare.
The Bank Rate Monitor National Index, Barron's, Business Week, CDA
Technologies, Donoghue's Money Market Fund Report, Financial Services
Week, Financial Times, Financial World, Forbes, Fortune, Global
Investor, Institutional Investor, Investor's Daily, Kiplinger's
Personal Finance, Lipper Analytical Services, Money, Morningstar,
Mutual Fund Forecaster, Newsweek, The New York Times, Personal
Investor, Stanger Report, Sylvia Porter's Personal Finance, USA Today,
U.S. News and World Report, The Wall Street Journal and Wiesenberger
Investment Companies Service.
CALCULATING ANNUITY PAYOUTS
We guarantee the fixed annuity payout amounts. Once calculated, the payout will
remain the same and never change. To calculate annuity payouts we:
o take the total value of the fixed account and the variable subaccounts at
the annuity start date, retirement date, or the date selected to begin
receiving annuity payouts; then
o using an annuity table we apply the value according to the annuity payout plan
selected.
The table will be equal to or greater than the table in the contract.
The annuity payout table we use will be the one in effect at the time chosen to
begin annuity payouts.
RATING AGENCIES
The following chart reflects the ratings given to us by independent rating
agencies. These agencies evaluate the financial soundness and claims-paying
ability of insurance companies based on a number of different factors. This
information does not relate to the management or performance of the subaccounts
of the contract. This information relates only to the fixed account and reflects
our ability to make annuity payouts and to pay death benefits and other
distributions from the contract.
Rating Agency Rating
A.M. Best A+
(Superior)
- -----------------------
Duff & Phelps AAA
- -----------------------
Moody's Aa2
<PAGE>
PRINCIPAL UNDERWRITER
The principal underwriter for the certificate is Smith Barney Inc., which offers
the contract on a continuous basis.
Surrender charges received by Smith Barney Inc. for the last three years
aggregated total $886,431, $688,455, and $551,374, respectively.
Commissions paid by Smith Barney Inc.for the last three years aggregated total
$1,115,312, $1,067,783, and $1,036,511, respectively.
INDEPENDENT AUDITORS
The financial statements appearing in this SAI have been audited by Ernst &
Young LLP (1400 Pillsbury Center, 200 South Sixth Street, Minneapolis, MN 55402)
independent auditors, as stated in their report appearing herein.
FINANCIAL STATEMENTS
<PAGE>
IDS Life of New York Account SBS
Annual Financial Information
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company of New York
We have audited the accompanying individual and combined statements of net
assets of the segregated asset subaccounts of IDS Life of New York Account SBS
(comprised of subaccounts BAP, BDS, BEG, BEM, BEX, BGI, BIH, BIE, BMO, BTR, BCR,
BMG AND BSI) as of December 31, 1998, and the related statements of operations
for the year then ended and the statements of changes in net assets for each of
the two years in the period then ended. These financial statements are the
responsibility of the management of IDS Life Insurance Company of New York. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned at December 31, 1998 with the affiliated and
unaffiliated mutual fund managers. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the individual and combined financial position of the
segregated asset subaccounts of IDS Life of New York Account SBS at December 31,
1998 and the individual and combined results of their operations and the changes
in their net assets for the periods described above, in conformity with
generally accepted accounting principles.
/s/Ernst & Young LLP
Ernst & Young LLP
Minneapolis, Minnesota
March 12, 1999
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Net Assets Dec. 31, 1998
Segregated Asset Subaccount
Assets BAP BDS BEG BEM
Investments in shares of mutual funds and portfolios:
<S> <C> <C> <C> <C>
at cost $ 3,702,664 $1,987,670 $ 813,127 $ 1,194,096
----------- ---------- --------- -----------
at market value $ 5,818,918 $2,148,660 $ 1,214,291 $ 1,636,523
Dividends receivable - - - -
Receivable from mutual funds and portfolios
for share redemptions 7 - - -
- ----- ----- -----
Total assets 5,818,925 2,148,660 1,214,291 1,636,523
========= ========= ========= =========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 6,192 2,285 1,306 1,730
Administrative charge 1,238 457 261 346
Certificate terminations 7 - - -
Payable to mutual funds and portfolios
for investments purchased - - - -
----- ----- ---- ----
Total liabilities 7,437 2,742 1,567 2,076
----- ----- ----- -----
Net assets applicable to contracts in
accumulation period 5,811,488 2,145,918 1,212,724 1,634,447
========= ========= ========= =========
Accumulation units outstanding 2,640,863 1,506,706 485,683 944,888
========= ========= ======= =======
Net asset value per accumulation unit $ 2.20 $ 1.42 $ 2.50 $ 1.73
====== ====== ====== ======
Assets BEX BGI BIH
Investments in shares of mutual funds and portfolios:
at cost $ 1,364,558 $ 2,214,314 $ 1,878,744
----------- ----------- -----------
at market value $ 3,092,093 $ 3,159,747 $ 1,977,322
Dividends receivable - - -
Receivable from mutual funds and portfolios
for share redemptions 9 7 -
- - ---
Total assets 3,092,102 3,159,754 1,977,322
========= ========= =========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 3,268 3,348 2,097
Administrative charge 654 670 419
Certificate terminations 9 7 -
Payable to mutual funds and portfolios
for investments purchased - - -
---- ---- ----
Total liabilities 3,931 4,025 2,516
----- ----- -----
Net assets applicable to contracts in
accumulation period 3,088,171 3,155,729 1,974,806
========= ========= =========
Accumulation units outstanding 1,141,269 1,553,578 1,532,565
========= ========= =========
Net asset value per accumulation unit $ 2.71 $ 2.03 $ 1.29
====== ====== ======
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Net Assets (continued) Dec. 31, 1998
Segregated Asset Subaccount
Assets BIE BMO BTR BCR
Investments in shares of mutual funds and portfolios:
<S> <C> <C> <C> <C>
at cost $ 845,816 $ 534,184 $ 1,773,129 $ 21,212
----------- --------- ----------- --------
at market value $ 1,164,227 $ 534,185 $ 2,380,021 $ 25,215
Dividends receivable - - - -
Receivable from mutual funds and portfolios
for share redemptions - - 7 32
---- --- - --
Total assets 1,164,227 534,185 2,380,028 25,247
========= ======= ========= ======
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 1,316 593 2,599 27
Administration charge 263 119 519 5
Certificate terminations - - 7 -
Payable to mutual funds and portfolios
for investments purchased - - - -
--- -- --- --
Total liabilities 1,579 712 3,125 32
----- --- ----- --
Net assets applicable to contracts in
accumulation period 1,162,648 533,473 2,376,903 25,215
========= ======= ========= ======
Accumulation units outstanding 887,562 458,120 1,206,105 14,059
======= ======= ========= ======
Net asset value per accumulation unit $ 1.31 $ 1.16 $ 1.97 $ 1.79
====== ====== ====== ======
Combined
Variable
Assets BMG BSI Account
Investments in shares of mutual funds and portfolios:
at cost $ - $ 18,351 $ 16,347,865
--- -------- ------------
at market value $ - $ 17,088 $ 23,168,290
Dividends receivable - 105 105
Receivable from mutual funds and portfolios
for share redemptions - - 62
--- --- --
Total assets - 17,193 23,168,457
--- ====== ==========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee - 18 24,779
Administration charge - 4 4,955
Certificate terminations - - 30
Payable to mutual funds and portfolios
for investments purchased - 83 83
--- -- --
Total liabilities - 105 29,847
--- --- ------
Net assets applicable to contracts in
accumulation period - 17,088 23,138,610
=== ====== ==========
Accumulation units outstanding - 15,296
=== ======
Net asset value per accumulation unit $ - $ 1.12
=== ======
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Operations Year ended Dec. 31, 1998
Segregated Asset Subaccount
Investment income BAP BDS BEG BEM
<S> <C> <C> <C> <C>
Dividend income from mutual funds and portfolios $ 315,981 $ 141,671 $ 176,197 $ 138,450
Expenses:
Mortality and expense risk fee 73,309 29,347 13,769 20,431
Administrative charge 14,662 5,870 2,754 4,086
------ ----- ----- -----
Total expenses 87,971 35,217 16,523 24,517
------ ------ ------ ------
Investment income (loss) - net 228,010 106,454 159,674 113,933
======= ======= ======= =======
Realized and unrealized gain (loss) on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales 1,129,327 515,789 259,853 331,961
Cost of investments sold 744,655 477,415 191,746 247,993
------- ------- ------- -------
Net realized gain (loss) on investments 384,672 38,374 68,107 83,968
Net change in unrealized appreciation or
depreciation of investments 332,093 (33,283) 101,896 32,668
------- ------- ------- ------
Net gain (loss) on investments 716,765 5,091 170,003 116,636
------- ----- ------- -------
Net increase (decrease) in net assets
resulting from operations $ 944,775 $ 111,545 $ 329,677 $ 230,569
========= ========= ========= =========
Investment income BEX BGI BIH
Dividend income from mutual funds and portfolios $ 29,490 $ 361,323 $ 132,811
Expenses:
Mortality and expense risk fee 34,740 39,134 25,725
Administrative charge 6,948 7,827 5,145
----- ----- -----
Total expenses 41,688 46,961 30,870
------ ------ ------
Investment income (loss) - net (12,198) 314,362 101,941
======= ======= =======
Realized and unrealized gain (loss) on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales 322,884 364,972 253,404
Cost of investments sold 156,962 246,617 243,452
------- ------- -------
Net realized gain (loss) on investments 165,922 118,355 9,952
Net change in unrealized appreciation or
depreciation of investments 525,208 (122,734) (7,465)
------- -------- ------
Net gain (loss) on investments 691,130 (4,379) 2,487
------- ------ -----
Net increase (decrease) in net assets
resulting from operations $ 678,932 $ 309,983 $ 104,428
========= ========= =========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Operations (continued) Year ended Dec. 31, 1998
Segregated Asset Subaccount
Investment income BIE BMO BTR BCR
<S> <C> <C> <C> <C>
Dividend income from mutual funds and portfolios $ 6,258 $ 24,056 $ 140,399 $ 1,830
Expenses:
Mortality and expense risk fee 17,151 6,969 33,012 266
Administrative charge 3,430 1,394 6,603 53
----- ----- ----- --
Total expenses 20,581 8,363 39,615 319
------ ----- ------ ---
Investment income (loss) - net (14,323) 15,693 100,784 1,511
======= ====== ======= =====
Realized and unrealized gain (loss) on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales 449,690 314,016 557,274 2,067
Cost of investments sold 357,096 314,015 412,197 1,855
------- ------- ------- -----
Net realized gain (loss) on investments 92,594 1 145,077 212
Net change in unrealized appreciation or
depreciation of investments 118,017 (2) (158,222) 2,620
------- -- -------- -----
Net gain (loss) on investments 210,611 (1) (13,145) 2,832
------- -- ------- -----
Net increase (decrease) in net assets
resulting from operations $ 196,288 $ 15,692 $ 87,639 $ 4,343
========= ======== ======== =======
Combined
Variable
Investment income BMG BSI Account
Dividend income from mutual funds and portfolios - $ 1,221 $ 1,469,687
Expenses:
Mortality and expense risk fee - 204 294,057
Administrative charge - 41 58,813
--- -- ------
Total expenses - 245 352,870
--- --- -------
Investment income (loss) - net - 976 1,116,817
=== === =========
Realized and unrealized gain (loss) on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales - 6 4,501,243
Cost of investments sold - 6 3,394,009
--- -- ---------
Net realized gain (loss) on investments - - 1,107,234
Net change in unrealized appreciation or
depreciation of investments - (1,050) 789,746
--- ------ -------
Net gain (loss) on investments - (1,050) 1,896,980
--- ------ ---------
Net increase (decrease) in net assets
resulting from operations $ - $ (74) $ 3,013,797
=== ===== ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Changes in Net Assets Year ended Dec. 31, 1998
Segregated Asset Subaccount
Operations BAP BDS BEG BEM
<S> <C> <C> <C> <C>
Investment income (loss) - net $ 228,010 $ 106,454 $ 159,674 $ 113,933
Net realized gain (loss) on investments 384,672 38,374 68,107 83,968
Net change in unrealized appreciation or
depreciation of investments 332,093 (33,283) 101,896 32,668
------- ------- ------- ------
Net increase (decrease) in net assets
resulting from operations 944,775 111,545 329,677 230,569
======= ======= ======= =======
Certificate transactions
Certificate purchase payments 790 250 1,511 40
Net transfers* 36,767 (11,879) (1,881) (96,995)
Certificate terminations:
Surrender benefits and certificate charges (944,728) (452,258) (192,040) (172,806)
Death benefits (5,069) (3,360) - -
------ ------
Increase (decrease) from certificate transactions (912,240) (467,247) (192,410) (269,761)
-------- -------- -------- --------
Net assets at beginning of year 5,778,953 2,501,620 1,075,457 1,673,639
--------- --------- --------- ---------
Net assets at end of year $ 5,811,488 $2,145,918 $ 1,212,724 $ 1,634,447
=========== ========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 3,081,905 1,841,311 581,926 1,115,107
Certificate purchase payments 376 179 688 25
Net transfers* 16,941 (8,776) (3,519) (61,993)
Certificate terminations:
Surrender benefits and certificate charges (455,931) (323,573) (93,412) (108,251)
Death benefits (2,428) (2,435) - -
------ ------
Units outstanding at end of year 2,640,863 1,506,706 485,683 944,888
========= ========= ======= =======
Operations BEX BGI BIH
Investment income (loss) - net $ (12,198) $ 314,362 $ 101,941
Net realized gain (loss) on investments 165,922 118,355 9,952
Net change in unrealized appreciation or
depreciation of investments 525,208 (122,734) (7,465)
------- -------- ------
Net increase (decrease) in net assets
resulting from operations 678,932 309,983 104,428
======= ======= =======
Certificate transactions
Certificate purchase payments 2,282 790 40
Net transfers* 26,626 (67,853) 28,071
Certificate terminations:
Surrender benefits and certificate charges (283,467) (233,756) (194,250)
Death benefits - - (25,951)
------- ------ -------
Increase (decrease) from certificate transactions (254,559) (300,819) (192,090)
-------- -------- --------
Net assets at beginning of year 2,663,798 3,146,565 2,062,468
--------- --------- ---------
Net assets at end of year $ 3,088,171 $ 3,155,729 $ 1,974,806
=========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 1,246,827 1,708,537 1,683,871
Certificate purchase payments 938 388 32
Net transfers* 10,707 (37,294) 22,482
Certificate terminations:
Surrender benefits and certificate charges (117,203) (118,053) (153,193)
Death benefits - - (20,627)
------ ----- -------
Units outstanding at end of year 1,141,269 1,553,578 1,532,565
========= ========= =========
*Includes transfer activity from (to) other subaccounts and transfers from (to)
IDS Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Changes in Net Assets (continued) Year ended Dec. 31, 1998
Segregated Asset Subaccount
Operations BIE BMO BTR BCR
<S> <C> <C> <C> <C>
Investment income (loss) - net $ (14,323) $ 15,693 $ 100,784 $ 1,511
Net realized gain (loss) on investments 92,594 1 145,077 212
Net change in unrealized appreciation or
depreciation of investments 118,017 (2) (158,222) 2,620
------- -- -------- -----
Net increase (decrease) in net assets
resulting from operations 196,288 15,692 87,639 4,343
======= ====== ====== =====
Certificate transactions
Certificate purchase payments 500 - - -
Net transfers* (4,283) 204,505 70,437 3,801
Certificate terminations:
Surrender benefits and certificate charges (402,817) (207,850) (477,886) (1,764)
Death benefits - - (28,747) -
----- ----- ------- -----
Increase (decrease) from certificate transactions (406,600) (3,345) (436,196) 2,037
-------- ------ -------- -----
Net assets at beginning of year 1,372,960 521,126 2,725,460 18,835
--------- ------- --------- ------
Net assets at end of year $ 1,162,648 $ 533,473 $ 2,376,903 $ 25,215
=========== ========= =========== ========
Accumulation unit activity
Units outstanding at beginning of year 1,226,952 460,369 1,430,157 12,843
Certificate purchase payments 377 - - -
Net transfers* (10,511) 176,937 34,773 2,368
Certificate terminations:
Surrender benefits and certificate charges (329,256) (179,186) (244,517) (1,152)
Death benefits - - (14,308) -
------ ----- ------- -----
Units outstanding at end of year 887,562 458,120 1,206,105 14,059
======= ======= ========= ======
Combined
Variable
Operations BMG BSI Account
Investment income (loss) - net $ - $ 976 $ 1,116,817
Net realized gain (loss) on investments - - 1,107,234
Net change in unrealized appreciation or
depreciation of investments - (1,050) 789,746
--- ------ -------
Net increase (decrease) in net assets
resulting from operations - (74) 3,013,797
=== === =========
Certificate transactions
Certificate purchase payments - - 6,203
Net transfers* - 2,987 190,303
Certificate terminations:
Surrender benefits and certificate charges - (6) (3,563,628)
Death benefits - - (63,127)
--- --- -------
Increase (decrease) from certificate transactions - 2,981 (3,430,249)
--- ----- ----------
Net assets at beginning of year - 14,181 23,555,062
--- ------ ----------
Net assets at end of year $ - $ 17,088 $ 23,138,610
=== ======== ============
Accumulation unit activity
Units outstanding at beginning of year - 12,690
Certificate purchase payments - -
Net transfers* - 2,611
Certificate terminations:
Surrender benefits and certificate charges - (5)
Death benefits - -
--- ---
Units outstanding at end of year - 15,296
--- ------
*Includes transfer activity from (to) other subaccounts and transfers from (to)
IDS Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Changes in Net Assets Year ended Dec. 31, 1997
Segregated Asset Subaccount
Operations BAP BDS BEG BEM
<S> <C> <C> <C> <C>
Investment income (loss) - net $ 286,891 $ 166,937 $ 108,938 $ 54,173
Net realized gain (loss) on investments 192,823 87,919 76,758 77,763
Net change in unrealized appreciation or
depreciation of investments 698,471 (91,948) 13,116 171,680
------- ------- ------ -------
Net increase (decrease) in net assets
resulting from operations 1,178,185 162,908 198,812 303,616
========= ======= ======= =======
Certificate transactions
Certificate purchase payments 18,728 9,250 1,494 1,002
Net transfers* 183,845 (310,923) 32,472 1,886
Certificate terminations:
Surrender benefits and certificate charges (487,735) (416,699) (140,652) (366,749)
Death benefits (7,124) - - (5,232)
------ ----- ----- ------
Increase (decrease) from certificate transactions (292,286) (718,372) (106,686) (369,093)
-------- -------- -------- --------
Net assets at beginning of year 4,893,054 3,057,084 983,331 1,739,116
--------- --------- ------- ---------
Net assets at end of year $ 5,778,953 $ 2,501,620 $ 1,075,457 $ 1,673,639
=========== =========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 3,249,343 2,397,158 635,093 1,409,996
Certificate purchase payments 10,959 7,154 931 844
Net transfers* 109,188 (239,465) 30,057 (1,885)
Certificate terminations:
Surrender benefits and certificate charges (283,107) (323,536) (84,155) (289,677)
Death benefits (4,478) - - (4,171)
------ ------
Units outstanding at end of year 3,081,905 1,841,311 581,926 1,115,107
========= ========= ======= =========
Operations BEX BGI BIH
Investment income (loss) - net $ 36,274 $ 206,514 $ 102,406
Net realized gain (loss) on investments 71,175 104,520 4,218
Net change in unrealized appreciation or
depreciation of investments 495,233 248,869 28,961
------- ------- ------
Net increase (decrease) in net assets
resulting from operations 602,682 559,903 135,585
------- ------- -------
Certificate transactions
Certificate purchase payments - 8,487 -
Net transfers* 157,307 92,265 435,930
Certificate terminations:
Surrender benefits and certificate charges (82,032) (196,957) (24,048)
Death benefits - - -
----- ----- -----
Increase (decrease) from certificate transactions 75,275 (96,205) 411,882
------ ------- -------
Net assets at beginning of year 1,985,841 2,682,867 1,515,001
--------- --------- ---------
Net assets at end of year $ 2,663,798 $ 3,146,565 $ 2,062,468
=========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 1,208,198 1,764,354 1,324,173
Certificate purchase payments - 4,896 -
Net transfers* 78,081 54,490 380,530
Certificate terminations:
Surrender benefits and certificate charges (39,452) (115,203) (20,832)
Death benefits - - -
----- ----- -----
Units outstanding at end of year 1,246,827 1,708,537 1,683,871
========= ========= =========
*Includes transfer activity from (to) other subaccounts and transfers from (to)
IDS Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Changes in Net Assets (continued) Year ended Dec. 31, 1997
Segregated Asset Subaccount
Operations BIE BMO BTR BCR
<S> <C> <C> <C> <C>
Investment income (loss) - net $ (20,942) $ 11,903 $ 72,824 $ 252
Net realized gain (loss) on investments 58,953 1 129,800 (3)
Net change in unrealized appreciation or
depreciation of investments (91,306) 5 141,461 3,186
------- - ------- -----
Net increase (decrease) in net assets
resulting from operations (53,295) 11,909 344,085 3,435
------- ------ ------- -----
Certificate transactions
Certificate purchase payments 1,501 - 39,268 -
Net transfers* (53,403) 246,033 421,173 -
Certificate terminations:
Surrender benefits and certificate charges (182,784) (113,729) (389,946) (2)
Death benefits - - - -
---- ---- ---- ----
Increase (decrease) from certificate transactions (234,686) 132,304 70,495 (2)
-------- ------- ------ --
Net assets at beginning of year 1,660,941 376,913 2,310,880 15,402
--------- ------- --------- ------
Net assets at end of year $ 1,372,960 $ 521,126 $ 2,725,460 $ 18,835
=========== ========= =========== ========
Accumulation unit activity
Units outstanding at beginning of year 1,430,246 342,709 1,395,812 12,845
Certificate purchase payments 1,252 - 22,336 -
Net transfers* (47,765) 219,667 241,847 -
Certificate terminations:
Surrender benefits and certificate charges (156,781) (102,007) (229,838) (2)
Death benefits - - - -
----- ----- ----- -----
Units outstanding at end of year 1,226,952 460,369 1,430,157 12,843
========= ======= ========= ======
Combined
Variable
Operations BMG BSI Account
Investment income (loss) - net $ (7) $ 577 $ 1,026,740
Net realized gain (loss) on investments 437 - 804,364
Net change in unrealized appreciation or
depreciation of investments (477) (213) 1,617,038
---- ---- ---------
Net increase (decrease) in net assets
resulting from operations (47) 364 3,448,142
=== === =========
Certificate transactions
Certificate purchase payments - - 79,730
Net transfers* (16,634) 13,817 1,203,768
Certificate terminations:
Surrender benefits and certificate charges (2) - (2,401,335)
Death benefits - - (12,356)
---- ---- -------
Increase (decrease) from certificate transactions (16,636) 13,817 (1,130,193)
------- ------ ----------
Net assets at beginning of year 16,683 - 21,237,113
------ ----- ----------
Net assets at end of year $ - $ 14,181 $ 23,555,062
=== ======== ============
Accumulation unit activity
Units outstanding at beginning of year 12,010 -
Certificate purchase payments - -
Net transfers* (12,008) 12,690
Certificate terminations:
Surrender benefits and certificate charges (2) -
Death benefits - -
---- ----
Units outstanding at end of year - 12,690
---- ======
*Includes transfer activity from (to) other subaccounts and transfers from (to)
IDS Life of New York's fixed account.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Notes to Financial Statements
1. Organization
IDS Life of New York Account SBS (the Variable Account) was established on Oct.
8, 1991 under New York law as a single unit investment trust of IDS Life
Insurance Company of New York (IDS Life of New York) under the Investment
Company Act of 1940, as amended (the 1940 Act). Operations of the Variable
Account commenced on March 15, 1993.
The Variable Account is comprised of various subaccounts. Each subaccount
invests exclusively in shares of the following mutual funds or portfolios
(collectively, the Funds), which are registered under the 1940 Act as
diversified, open-end management investment companies and have the following
investment managers.
<S> <C> <C>
Subaccount Invests exclusively in shares of Investment Manager
BAP Appreciation Portfolio Smith Barney Inc.1
BDS Diversified Strategic Income Portfolio Smith Barney Inc.2
BEG Emerging Growth Portfolio Smith Barney Inc.3
BEM Equity Income Portfolio Smith Barney Inc.1
BEX Equity Index Portfolio Smith Barney Inc.4
BGI Growth & Income Portfolio Smith Barney Inc.1
BIH Intermediate High Grade Portfolio Smith Barney Inc.1
BIE International Equity Portfolio Smith Barney Inc.1
BMO Money Market Portfolio Smith Barney Inc.1
BTR Total Return Portfolio Smith Barney Inc.1
BCR IDS Life Capital Resource Fund IDS Life Insurance Company 5
BMG IDS Life Managed Fund IDS Life Insurance Company 5
BSI IDS Life Special Income Fund IDS Life Insurance Company 5
1 Mutual Management Corp. (MMC) is the investment advisor.
2 MMC. is the investment advisor. Smith Barney Global Capital Management, Inc.
is the sub-investment advisor.
3 Van Kampen American Capital Asset Management, Inc. is the investment advisor.
4 Travelers Investment Management Co. is the investment advisor.
5 American Express Financial Corporation (AEFC) is the investment advisor.
The assets of each subaccount of the Variable Account are not chargeable with
liabilities arising out of the business conducted by any other segregated asset
account or by IDS Life of New York.
IDS Life of New York serves as issuer of the contracts.
2. Summary of Significant Accounting Policies
Investments in the Fund
Investments in shares of the Funds are stated at market value which is the net
asset value per share as determined by the respective Funds. Investment
transactions are accounted for on the date the shares are purchased and sold.
The cost of investments sold and redeemed is determined on the average cost
method. Dividend distributions received from the Funds are reinvested in
additional shares of the Funds and are recorded as income by the subaccounts on
the ex-dividend date.
Unrealized appreciation or depreciation of investments in the accompanying
financial statements represents the subaccounts' share of the Funds'
undistributed net investment income, undistributed realized gain or loss and the
unrealized appreciation or depreciation on their investment securities.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the period. Actual results could differ from those estimates.
Federal Income Taxes
IDS Life of New York is taxed as a life insurance company. The Variable Account
is treated as part of IDS Life of New York for federal income tax purposes.
Under existing federal income tax law, no income taxes are payable with respect
to any investment income of the Variable Account.
3. Mortality and Expense Risk Fee
IDS Life of New York makes contractual assurances to the Variable Account that
possible future adverse changes in administrative expenses and mortality
experience of the contract owners and annuitants will not affect the Variable
Account. The mortality and expense risk fee paid to IDS Life of New York is
deducted daily and is equal, on an annual basis, to 1.25% of the daily net
assets of the subaccounts.
4. Variable Account Administrative Charge
IDS Life of New York deducts a daily charge equal, on an annual basis, to 0.25%
of the daily net asset value of each subaccount. It covers certain
administrative and operating expenses of the subaccounts incurred by IDS Life of
New York such as accounting, legal and data processing fees, and expenses
involved in the preparation and distribution of reports and prospectuses.
5. Certificate Administrative Charge
IDS Life of New York deducts an administrative charge of $30 per year on each
certificate anniversary. This charge reimburses IDS Life of New York for
expenses incurred in establishing and maintaining the Annuity records. This
charge cannot be increased and does not apply after a retirement payment plan
begins. IDS Life of New York does not expect to profit from this charge.
6. Surrender Charge
IDS Life of New York will use a surrender charge to help it recover certain
expenses relating to the sale of the Annuity. The surrender charge is deducted
for surrenders during the first six payment years following a purchase payment.
Charges by IDS Life of New York for surrenders are not identified on an
individual segregated asset account basis. Charges for all segregated asset
accounts amounted to $886,431 in 1998 and $688,445 in 1997. Such charges are not
treated as a separate expense of the subaccounts. They are ultimately deducted
from contract surrender benefits paid by IDS Life of New York.
7. Investment in Shares
The subaccounts' investment in shares of the Funds as of Dec. 31, 1998 were as
follows:
Subaccount Investment Shares NAV
BAP Appreciation Portfolio 274,996 $21.16
BDS Diversified Strategic Income Portfolio 197,125 10.90
BEG Emerging Growth Portfolio 61,859 19.63
BEM Equity Income Portfolio 99,910 16.38
BEX Equity Index Portfolio 103,173 29.97
BGI Growth & Income Portfolio 171,075 18.47
BIH Intermediate High Grade Portfolio 181,406 10.90
BIE International Equity Portfolio 83,517 13.94
BMO Money Market Portfolio 534,185 1.00
BTR Total Return Portfolio 135,614 17.55
BCR IDS Life Capital Resource Fund 722 32.66
BMG IDS Life Managed Fund -- --
BSI IDS Life Special Income Fund 1,538 11.11
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
8. Investment Transactions
The subaccounts' purchases of Funds' shares, including reinvestment of dividend
distributions, were as follows:
Year ended Dec. 31,
Subaccount Investment 1998 1997
<S> <C> <C>
BAP Appreciation Portfolio $ 444,679 $ 610,835
BDS Diversified Strategic Income Portfolio 154,343 248,185
BEG Emerging Growth Portfolio 227,153 242,570
BEM Equity Income Portfolio 175,928 168,423
BEX Equity Index Portfolio 56,412 273,142
BGI Growth & Income Portfolio 378,249 394,565
BIH Intermediate High Grade Portfolio 162,974 589,569
BIE International Equity Portfolio 28,465 78,871
BMO Money Market Portfolio 326,416 314,123
BTR Total Return Portfolio 221,289 612,361
BCR IDS Life Capital Resource Fund 5,589 372
BMG IDS Life Managed Fund -- --
BSI IDS Life Special Income Fund 3,963 14,394
----- ------
Combined Variable Account $2,185,460 $3,547,410
9. Year 2000 Issue (unaudited)
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of IDS Life of New York and
the Variable Account. IDS Life of New York and the Variable Account have no
computer systems of their own but are dependent upon the systems of AEFC and
certain other third parties.
A comprehensive review of AEFC's computer systems and business processes has
been conducted to identify the major systems that could be affected by the Year
2000 issue. Steps are being taken to resolve any potential problems including
modification to existing software and the purchase of new software. These
measures are scheduled to be completed and tested on a timely basis. AEFC's
target date for substantially completing corrective measures on business
critical systems was Dec. 31, 1998. Substantial testing of these systems was
targeted for completion early in 1999. AEFC is currently on track with this
schedule and is also on track to finish the work on non-critical systems by June
30, 1999. The Year 2000 readiness of unaffiliated investment managers and other
third parties whose system failures could have an impact on IDS Life of New
York's and the Variable Account's operations continues to be evaluated. The
potential materiality of any such impact is not known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
</TABLE>
<PAGE>
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
IDS LIFE OF NEW YORK FINANCIAL INFORMATION
- -----------------------------------------------------------------
The financial statements shown below are those of the insurance company and not
those of any other entity. They are included for the purpose of informing the
investor as to the financial condition of the insurance company and its ability
to carry out its obligations under its variable contracts.
IDS LIFE INSURANCE COMPANY OF NEW YORK
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
DEC. 31, 1998
BALANCE SHEETS DEC. 31, 1997
ASSETS (thousands)
<S> <C> <C>
- -------------------------------------------------------------------------------------------------
Investments:
Fixed maturities:
Held to maturity, at amortized cost (fair value: 1998, $503,909;
1997, $562,979).................................................. $ 473,592 $ 535,651
Available for sale, at fair value (amortized cost: 1998,
$561,325; 1997, $582,962)........................................ 578,591 603,576
Mortgage loans on real estate.................................... 166,835 178,826
Policy loans..................................................... 25,421 23,349
Other investments................................................ 566 970
- -------------------------------------------------------------------------------------------------
Total investments................................................ 1,245,005 1,342,372
- -------------------------------------------------------------------------------------------------
Cash and cash equivalents........................................ 3,007 --
Amounts recoverable from reinsurers.............................. 4,077 2,317
Accounts receivable.............................................. 842 723
Premiums due..................................................... 204 192
Accrued investment income........................................ 19,893 20,205
Deferred policy acquisition costs................................ 129,477 126,614
Other assets..................................................... 1,042 995
Separate account assets.......................................... 1,491,679 1,236,759
- -------------------------------------------------------------------------------------------------
Total assets..................................................... $ 2,895,226 $ 2,730,177
- -------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDER'S EQUITY
<S> <C> <C>
- -------------------------------------------------------------------------------------------------
Liabilities:
Future policy benefits:
Fixed annuities.................................................. $ 875,507 $ 964,483
Universal life-type insurance.................................... 152,195 147,744
Traditional life, disability income and long-term care
insurance........................................................ 55,910 50,469
Policy claims and other policyholders' funds..................... 3,105 4,013
Deferred income taxes............................................ 7,912 11,445
Amounts due to brokers........................................... 4,507 29,054
Other liabilities................................................ 24,945 28,931
Separate account liabilities..................................... 1,491,679 1,236,759
- -------------------------------------------------------------------------------------------------
Total liabilities................................................ 2,615,760 2,472,898
- -------------------------------------------------------------------------------------------------
Stockholder's equity:
Capital stock, $10 par value per share; 200,000 shares
authorized, issued and outstanding............................... 2,000 2,000
Additional paid-in capital....................................... 49,000 49,000
Accumulated other comprehensive income:
Net unrealized securities gains.................................. 11,014 13,175
Retained earnings................................................ 217,452 193,104
- -------------------------------------------------------------------------------------------------
Total stockholder's equity....................................... 279,466 257,279
- -------------------------------------------------------------------------------------------------
Total liabilities and stockholder's equity....................... $ 2,895,226 $ 2,730,177
- -------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-1
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED DEC. 31,
1998 1997 1996
STATEMENTS OF INCOME (thousands)
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------
Revenues:
Traditional life, disability income and long-term care insurance
premiums......................................................... $ 13,852 $ 12,376 $ 10,931
Policyholder and contractholder charges.......................... 20,467 18,319 15,832
Mortality and expense risk fees.................................. 13,980 11,312 8,574
Net investment income............................................ 100,871 106,274 109,468
Net realized gains (losses) on investments....................... 2,163 547 (1,424)
- --------------------------------------------------------------------------------------------------------
Total revenues................................................... 151,333 148,828 143,381
- --------------------------------------------------------------------------------------------------------
Benefits and expenses:
Death and other benefits: Traditional life, disability income and
long-term care insurance......................................... 5,553 3,633 4,182
Universal life-type insurance and investment contracts........... 4,320 3,852 4,409
Increase in liabilities for future policy benefits for
traditional life, disability income and long-term care
insurance........................................................ 3,662 3,979 2,324
Interest credited on universal life-type insurance and investment
contracts........................................................ 55,073 62,294 65,099
Amortization of deferred policy acquisition costs................ 18,362 17,201 16,071
Other insurance and operating expenses........................... 8,917 10,220 8,972
- --------------------------------------------------------------------------------------------------------
Total benefits and expenses...................................... 95,887 101,179 101,057
- --------------------------------------------------------------------------------------------------------
Income before income taxes....................................... 55,446 47,649 42,324
Income taxes..................................................... 19,098 16,471 14,640
- --------------------------------------------------------------------------------------------------------
Net income....................................................... $ 36,348 $ 31,178 $ 27,684
- --------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-2
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
THREE YEARS ENDED DEC. 31, 1998
(thousands) ACCUMULATED
OTHER
TOTAL COMPREHENSIVE
STOCKHOLDER'S CAPITAL INCOME, RETAINED
STATEMENTS OF STOCKHOLDER'S EQUITY EQUITY STOCK ADDITIONAL NET OF TAX EARNINGS
PAID-IN
CAPITAL
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
Balance, Dec. 31, 1995.................................... $218,583 $ 2,000 $ 49,000 $15,341 $ 152,242
Comprehensive income:
Net income............................................ 27,684 -- -- -- 27,684
Unrealized holding losses arising during the year, net
of effect on deferred policy acquisition costs of $296
and taxes of $5,055................................... (9,387) -- -- (9,387 ) --
Reclassification adjustment for losses included in net
income, net of tax of $(530).......................... 983 -- -- 983 --
------- ----------
Other comprehensive loss.................................. (8,404) -- -- (8,404 ) --
-------
Comprehensive income...................................... 19,280
Cash dividends to parent.................................. (8,000) -- -- -- (8,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1996.................................... 229,863 2,000 49,000 6,937 171,926
Comprehensive income:
Net income............................................ 31,178 -- -- -- 31,178
Unrealized holding gains arising during the year, net
of effect on deferred policy acquisition costs of $(1)
and taxes of $(3,412)................................. 6,337 -- -- 6,337 --
Reclassification adjustment for gains included in net
income, net of tax of $54............................. (99) -- -- (99 ) --
------- ----------
Other comprehensive income................................ 6,238 -- -- 6,238 --
-------
Comprehensive income...................................... 37,416
Cash dividends to parent.................................. (10,000) -- -- -- (10,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1997.................................... 257,279 2,000 49,000 13,175 193,104
Comprehensive income:
Net income............................................ 36,348 -- -- -- 36,348
Unrealized holding losses arising during the year, net
of effect on deferred policy acquisition costs of $22
and taxes of $1,415................................... (2,628) -- -- (2,628 ) --
Reclassification adjustment for gains included in net
income, net of tax of $(252).......................... 467 -- -- 467 --
------- ----------
Other comprehensive loss.................................. (2,161) -- -- (2,161 ) --
-------
Comprehensive income...................................... 34,187
Cash dividends to parent.................................. (12,000) -- -- -- (12,000 )
--------------------------------------------------------------
Balance, Dec. 31, 1998.................................... $279,466 $ 2,000 $ 49,000 $11,014 $ 217,452
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-3
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEARS ENDED DEC. 31,
1998 1997 1996
STATEMENTS OF CASH FLOWS (thousands)
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income....................................................... $ 36,348 $ 31,178 $ 27,684
Adjustments to reconcile net income to net cash provided by
operating activities:
Policy loan issuance, excluding universal life-type insurance.... (3,110) (3,073) (2,473)
Policy loan repayment, excluding universal life-type insurance... 2,660 1,897 1,571
Change in accrued investment income.............................. 312 863 1,504
Change in amounts recoverable from reinsurer..................... (1,760) (1,345) (460)
Change in premiums due........................................... (12) (50) 25
Change in accounts receivable.................................... (119) 218 (83)
Change in other assets........................................... (47) (95) (328)
Change in deferred policy acquisition costs, net................. (2,841) (7,431) (9,087)
Change in liabilities for future policy benefits for traditional
life, disability income and long-term care insurance............. 5,441 5,131 2,861
Change in policy claims and other policyholders' funds........... (908) 858 (489)
Deferred income tax benefit...................................... (2,369) (960) (2,095)
Change in other liabilities...................................... (3,986) 3,468 4,434
Accretion of discount, net....................................... (342) (352) (652)
Net realized (gain) loss on investments.......................... (2,163) (547) 1,424
Policyholder and contractholder charges, non-cash................ (9,661) (8,772) (7,831)
Other, net....................................................... 118 715 (935)
- ---------------------------------------------------------------------------------------------------------
Net cash provided by operating activities........................ 17,561 21,703 15,070
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Fixed maturities held to maturity:
Maturities, sinking fund payments and calls...................... 46,629 36,511 39,082
Sales............................................................ 16,173 12,616 14,465
Fixed maturities available for sale:
Purchases........................................................ (86,072) (101,818) (97,370)
Maturities, sinking fund payments and calls...................... 96,578 84,229 71,939
Sales............................................................ 13,180 27,055 15,669
Other investments, excluding policy loans:
Purchases........................................................ (9,121) (33,243) (14,802)
Sales............................................................ 21,113 14,233 12,659
Change in amounts due from broker................................ -- 995 --
Change in amounts due to broker.................................. (24,547) 26,047 (6,993)
- ---------------------------------------------------------------------------------------------------------
Net cash provided by investing activities........................ 73,933 66,625 34,649
- ---------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Activity related to universal life-type insurance and investment
contracts:
Considerations received.......................................... 76,009 112,732 131,011
Surrenders and death benefits.................................... (205,946) (251,259) (236,689)
Interest credited to account balances............................ 55,073 62,294 65,099
Universal life-type insurance policy loans:
Issuance......................................................... (5,222) (4,848) (4,490)
Repayment........................................................ 3,599 2,753 3,350
Cash dividend to parent.......................................... (12,000) (10,000) (8,000)
- ---------------------------------------------------------------------------------------------------------
Net cash used in financing activities............................ (88,487) (88,328) (49,719)
- ---------------------------------------------------------------------------------------------------------
Net increase in cash and cash equivalents........................ 3,007 -- --
Cash and cash equivalents at beginning of year................... -- -- --
- ---------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year......................... $ 3,007 $ -- $ --
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
F-4
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS)
- -----------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS
IDS Life Insurance Company of New York (the Company) is engaged in the insurance
and annuity business in the state of New York. The Company's principal products
are deferred annuities and universal life insurance which are issued primarily
to individuals. It offers single premium and flexible premium deferred annuities
on both a fixed and variable dollar basis. Immediate annuities are offered as
well. The Company's insurance products include universal life (fixed and
variable), whole life, single premium life and term products (including waiver
of premium and accidental death benefits). The Company also markets disability
income and long-term care insurance.
BASIS OF PRESENTATION
The Company is a wholly owned subsidiary of IDS Life Insurance Company (IDS
Life), which is a wholly owned subsidiary of American Express Financial
Corporation (AEFC), which is a wholly owned subsidiary of American Express
Company. The accompanying financial statements have been prepared in conformity
with generally accepted accounting principles which vary in certain respects
from reporting practices prescribed or permitted by the New York Department of
Insurance as reconciled in Note 11.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
INVESTMENTS
Fixed maturities that the Company has both the positive intent and the ability
to hold to maturity are classified as held to maturity and carried at amortized
cost. All other fixed maturities and all marketable equity securities are
classified as available for sale and carried at fair value. Unrealized gains and
losses on securities classified as available for sale are reported as a separate
component of accumulated other comprehensive income, net of deferred policy
acquisition costs and deferred income taxes.
Realized investment gains or losses are determined on an identified cost basis.
Prepayments are anticipated on certain investments in mortgage-backed securities
in determining the constant effective yield used to recognize interest income.
Prepayment estimates are based on information received from brokers who deal in
mortgage-backed securities.
Mortgage loans on real estate are carried at amortized cost less reserves for
mortgage loan losses. The estimated fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage interest rates
currently offered for mortgages of similar maturities.
F-5
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Impairment of mortgage loans is measured as the excess of the loan's recorded
investment over its present value of expected principal and interest payments
discounted at the loan's effective interest rate, or the fair value of
collateral. The amount of the impairment is recorded in an allowance for
mortgage loan losses. The allowance for mortgage loan losses is maintained at a
level that management believes is adequate to absorb estimated losses in the
portfolio. The level of the allowance account is determined based on several
factors, including historical experience, expected future principal and interest
payments, estimated collateral values, and current and anticipated economic and
political conditions. Management regularly evaluates the adequacy of the
allowance for mortgage loan losses.
The Company generally stops accruing interest on mortgage loans for which
interest payments are delinquent more than three months. Based on management's
judgment as to the ultimate collectibility of principal, interest payments
received are either recognized as income or applied to the recorded investment
in the loan.
The cost of interest rate caps is amortized to investment income over the life
of the contracts and payments received as a result of these agreements are
recorded as investment income when realized. The amortized cost of interest rate
caps is included in other investments.
Policy loans are carried at the aggregate of the unpaid loan balances which do
not exceed the cash surrender values of the related policies.
When evidence indicates a decline, which is other than temporary, in the
underlying value or earning power of individual investments, such investments
are written down to the fair value by a charge to income.
STATEMENTS OF CASH FLOWS
The Company considers investments with a maturity at the date of their
acquisition of three months or less to be cash equivalents. These securities are
carried principally at amortized cost which approximates fair value.
Supplementary information to the statements of cash flows for the years ended
December 31 is summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
CASH PAID DURING THE YEAR FOR:
Income taxes....................... $22,470 $17,811 $15,247
Interest on borrowings............. 1,600 1,026 777
- --------------------------------------------------------------
</TABLE>
RECOGNITION OF PROFITS ON ANNUITY
CONTRACTS AND INSURANCE POLICIES
Profits on fixed deferred annuities are recognized by the Company over the lives
of the contracts, using primarily the interest method. Profits represent the
excess of investment income earned from investment of contract considerations
over interest credited to contract owners and other expenses.
The retrospective deposit method is used in accounting for universal life-type
insurance. This method recognizes profits over the lives of the policies in
proportion to the estimated gross profits expected to be realized.
F-6
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Premiums on traditional life, disability income and long-term care insurance
policies are recognized as revenue when due, and related benefits and expenses
are associated with premium revenue in a manner that results in recognition of
profits over the lives of the insurance policies. This association is
accomplished by means of the provision for future policy benefits and the
deferral and subsequent amortization of policy acquisition costs.
Policyholder and contractholder charges include the monthly cost of insurance
charges, issue and administrative fees and surrender charges. These charges also
include the minimum death benefit guarantee fees received from the variable life
insurance separate accounts. Mortality and expense fees are received from the
variable annuity and variable life insurance separate accounts.
DEFERRED POLICY ACQUISITION COSTS
The costs of acquiring new business, principally sales compensation, policy
issue costs, underwriting and certain sales expenses, have been deferred on
insurance and annuity contracts. The deferred acquisition costs for most single
premium deferred annuities and installment annuities are amortized primarily
using the interest method. The costs for universal life-type insurance and
certain installment annuities are amortized as a percentage of the estimated
gross profits expected to be realized on the policies. For traditional life,
disability income and long-term care insurance policies, the costs are amortized
over an appropriate period in proportion to premium revenue.
LIABILITIES FOR FUTURE POLICY BENEFITS
Liabilities for universal life-type insurance and deferred annuities are
accumulation values.
Liabilities for fixed annuities in a benefit status are based on mortality
tables with various interest rates ranging from 5% to 9.5%, depending on year of
issue.
Liabilities for future benefits on traditional life insurance are based on the
net level premium method, using anticipated mortality, policy persistency and
interest earning rates. Anticipated mortality rates are based on established
industry mortality tables. Anticipated policy persistency rates vary by policy
form, issue age and policy duration with persistency on cash value plans
generally anticipated to be better than persistency on term insurance plans.
Anticipated interest rates range from 4% to 10%, depending on policy form, issue
year and policy duration.
Liabilities for future disability income and long-term care policy benefits
include both policy reserves and claim reserves. Policy reserves are based on
the net level premium method, using anticipated morbidity, mortality, policy
persistency and interest earning rates. Anticipated morbidity and mortality
rates are based on established industry morbidity and mortality tables.
Anticipated policy persistency rates vary by policy form, issue age, policy
duration and, for disability income policies, occupation class. Anticipated
interest rates for disability income and long-term care policy reserves are 3%
to 9.5% at policy issue and grade to ultimate rates of 5% to 7% over 4 to 10
years.
Claim reserves are calculated based on claim continuance tables and anticipated
interest earnings. Anticipated claim continuance rates are based on established
industry tables. Anticipated interest rates for claim reserves for both
disability income and long-term care range from 6% to 8%.
F-7
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
REINSURANCE
The maximum amount of life insurance risk retained by the Company on any one
life is $750 of life benefit plus $50 of accidental death benefits. The maximum
amount of life insurance risk retained on any joint-life combination is $1,500.
The excesses are reinsured with other life insurance companies, primarily on a
yearly renewable term basis. Long-term care policies are primarily reinsured on
a coinsurance basis. Beginning in 1998, the Company retains all disability
income and waiver of premium risk.
FEDERAL INCOME TAXES
The Company's taxable income is included in the consolidated federal income tax
return of American Express Company. The Company provides for income taxes on a
separate return basis, except that, under an agreement between AEFC and American
Express Company, tax benefit is recognized for losses to the extent they can be
used on the consolidated tax return. It is the policy of AEFC and its
subsidiaries that AEFC will reimburse subsidiaries for all tax benefits.
Included in other liabilities at December 31, 1998 and 1997 are $3,647, and
$5,026, respectively, payable to IDS Life for federal income taxes.
SEPARATE ACCOUNT BUSINESS
The separate account assets and liabilities represent funds held for the
exclusive benefit of the variable annuity and variable life insurance contract
owners. The Company receives mortality and expense risk fees from the variable
annuity separate accounts.
The Company makes contractual mortality assurances to the variable annuity
contract owners that the net assets of the separate accounts will not be
affected by future variations in the actual life expectancy experience of the
annuitants and beneficiaries from the mortality assumptions implicit in the
annuity contracts. The Company makes periodic fund transfers to, or withdrawals
from, the separate accounts for such actuarial adjustments for variable
annuities that are in the benefit payment period. The Company also guarantees
that the rates at which administrative fees are deducted from contract funds
will not exceed contractual maximums.
For variable life insurance, the Company guarantees that the rates at which
insurance charges and administrative fees are deducted from contract funds will
not exceed contractual maximums. The Company also guarantees that the death
benefit will continue payable at the initial level regardless of investment
performance so long as minimum premium payments are made.
ACCOUNTING CHANGES
Effective January 1, 1998, the Company adopted SFAS No. 130, "Reporting
Comprehensive Income." SFAS No. 130 requires the reporting and display of
comprehensive income and its components. Comprehensive income is defined as the
aggregate change in stockholder's equity excluding changes in ownership
interests. For the Company, it is net income and the unrealized gains or losses
on available-for-sale securities net of the effect on deferred policy acquistion
costs, of taxes and reclassification adjustment.
F-8
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In March 1998, the American Institute of Certified Public Accountants (AICPA)
issued Statement of Position (SOP) 98-1, "Accounting for Costs of Computer
Software Developed or Obtained for Internal Use." The SOP, which is effective
January 1, 1999, requires the capitalization of certain costs incurred after the
date of adoption to develop or obtain software for internal use. Software
utilized by the Company is owned by AEFC and will be capitalized on AEFC's
financial statements. As a result, the new rule will not have a material impact
on the Company's results of operations or financial condition.
In December 1997, the AICPA issued SOP 97-3, "Accounting by Insurance and Other
Enterprises for Insurance-Related Assessments," providing guidance for the
timing of recognition of liabilities related to guaranty fund assessments. The
Company will adopt the SOP on January 1, 1999. The Company has historically
carried a balance in other liabilities on the balance sheet for potential
guaranty fund assessment exposure. Adoption of the SOP will not have a material
impact on the Company's results of operations or financial condition
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which is effective January 1, 2000. This
Statement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires that an entity recognize all
derivatives as either assets or liabilities in the balance sheet and measure
those instruments at fair value. The accounting for changes in the fair value of
a derivative depends on the intended use of the derivative and the resulting
designation. Earlier application of all of the provisions of this Statement is
encouraged, but it is permitted only as of the beginning of any fiscal quarter
that begins after issuance of the Statement. This Statement cannot be applied
retroactively. The ultimate financial impact of the new rule will be measured
based on the derivatives in place at adoption and cannot be estimated at this
time.
RECLASSIFICATIONS
Certain 1997 and 1996 amounts have been reclassified to conform to the 1998
presentation.
F-9
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS
Fair values of investments in fixed maturities represent quoted market prices
and estimated values when quoted prices are not available. Estimated values are
determined by established procedures involving, among other things, review of
market indices, price levels of current offerings of comparable issues, price
estimates and market data from independent brokers and financial files.
The amortized cost, gross unrealized gains and losses and fair value of
investments in fixed maturities at December 31, 1998 are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
HELD TO MATURITY COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
U.S. Government agency
obligations................... $ 2,871 $ 159 $ -- $ 3,030
Corporate bonds and
obligations................... 417,648 29,795 474 446,969
Mortgage-backed securities.... 53,073 844 7 53,910
- -----------------------------------------------------------------------------------
$473,592 $30,798 $ 481 $ 503,909
- -----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
AVAILABLE FOR SALE COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
State and municipal
obligations................... $ 105 $ 9 $ -- $ 114
Corporate bonds and
obligations................... 336,985 15,939 6,296 346,628
Mortgage-backed securities.... 224,235 7,614 -- 231,849
- -----------------------------------------------------------------------------------
$561,325 $23,562 $6,296 $ 578,591
- -----------------------------------------------------------------------------------
</TABLE>
The amortized cost, gross unrealized gains and losses and fair value of
investments in fixed maturities at December 31, 1997 are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
HELD TO MATURITY COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
U.S. Government agency
obligations................... $ 3,690 $ 253 $ -- $ 3,943
Corporate bonds and
obligations................... 476,108 27,361 444 503,025
Mortgage-backed securities.... 55,853 452 294 56,011
- -----------------------------------------------------------------------------------
$535,651 $28,066 $ 738 $ 562,979
- -----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
AVAILABLE FOR SALE COST GAINS LOSSES VALUE
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------
State and municipal
obligations................... $ 104 $ 10 $ -- $ 114
Corporate bonds and
obligations................... 281,555 14,272 1,635 294,192
Mortgage-backed securities.... 301,303 8,253 286 309,270
- -----------------------------------------------------------------------------------
$582,962 $22,535 $1,921 $ 603,576
- -----------------------------------------------------------------------------------
</TABLE>
F-10
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
The amortized cost and fair value of investments in fixed maturities at December
31, 1998 by contractual maturity are shown below. Expected maturities will
differ from contractual maturities because borrowers may have the right to call
or prepay obligations with or without call or prepayment penalties.
<TABLE>
<CAPTION>
AMORTIZED FAIR
HELD TO MATURITY COST VALUE
<S> <C> <C>
- ----------------------------------------------------------------
Due in one year or less................. $ 22,671 $ 22,908
Due from one to five years.............. 152,766 162,929
Due from five to ten years.............. 183,198 195,428
Due in more than ten years.............. 61,884 68,733
Mortgage-backed securities.............. 53,073 53,911
- ----------------------------------------------------------------
$473,592 $ 503,909
- ----------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AMORTIZED FAIR
AVAILABLE FOR SALE COST VALUE
<S> <C> <C>
- ----------------------------------------------------------------
Due in one year or less................. $ 8,512 $ 8,716
Due from one to five years.............. 40,511 43,188
Due from five to ten years.............. 191,185 197,625
Due in more than ten years.............. 96,881 97,213
Mortgage-backed securities.............. 224,236 231,849
- ----------------------------------------------------------------
$561,325 $ 578,591
- ----------------------------------------------------------------
</TABLE>
During the years ended December 31, 1998, 1997 and 1996, fixed maturities
classified as held to maturity were sold with amortized cost of $16,175, $12,737
and $14,507, respectively. Net gains and losses on these sales were not
significant. The sale of these fixed maturities was due to significant
deterioration in the issuers' creditworthiness.
Fixed maturities available for sale were sold during 1998 with proceeds of
$13,180 and gross realized gains and losses of $1,159 and $440, respectively.
Fixed maturities available for sale were sold during 1997 with proceeds of
$27,055 and gross realized gains and losses of $461 and $309, respectively.
Fixed maturities available for sale were sold during 1996 with proceeds of
$15,669 and gross realized gains and losses of $28 and $1,541, respectively.
At December 31, 1998, bonds carried at $257 were on deposit with the state of
New York as required by law.
F-11
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998, investments in fixed maturities comprised 85 percent of
the Company's total invested assets. These securities are rated by Moody's and
Standard & Poor's (S&P), except for securities carried at approximately $153
million which are rated by AEFC internal analysts using criteria similar to
Moody's and S&P. A summary of investments in fixed maturities, at amortized
cost, by rating on December 31 is as follows:
<TABLE>
<CAPTION>
RATING 1998 1997
<S> <C> <C>
- ----------------------------------------------------------------
Aaa/AAA................................. $ 280,669 $ 367,242
Aa/AA................................... 15,815 9,685
Aa/A.................................... 16,327 13,646
A/A..................................... 151,838 162,275
A/BBB................................... 68,640 81,463
Baa/BBB................................. 366,776 343,519
Baa/BB.................................. 39,666 21,519
Below investment grade.................. 95,186 119,264
- ----------------------------------------------------------------
$1,034,917 $1,118,613
- ----------------------------------------------------------------
</TABLE>
F-12
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998, 98 percent of the securities rated Aaa/AAA are GNMA, FNMA
and FHLMC mortgage-backed securities. No holdings of any other issuer are
greater than one percent of the Company's total investments in fixed maturities.
At December 31, 1998, approximately 13 percent of the Company's investments were
mortgage loans on real estate. Summaries of mortgage loans by region of the
United States and by type of real estate are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1998 DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
REGION SHEET TO PURCHASE SHEET TO PURCHASE
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------
West North Central............ $ 24,725 $ -- $ 27,833 $ --
East North Central............ 29,134 59 33,515 --
South Atlantic................ 34,175 598 34,182 2,750
Middle Atlantic............... 18,350 -- 24,485 --
Pacific....................... 9,706 -- 9,873 --
Mountain...................... 36,636 -- 32,864 6,417
New England................... 7,851 -- 8,624 --
East South Central............ 7,521 -- 8,698 --
West South Central............ 237 -- 252 --
- ---------------------------------------------------------------------------------------
168,335 657 180,326 9,167
Less allowance for losses..... 1,500 -- 1,500 --
- ---------------------------------------------------------------------------------------
$166,835 $657 $178,826 $9,167
- ---------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1998 DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
PROPERTY TYPE SHEET TO PURCHASE SHEET TO PURCHASE
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------
Apartments.................... $ 59,019 $ -- $ 68,823 $ --
Department/retail stores...... 54,018 624 54,622 6,417
Office buildings.............. 23,902 -- 25,042 1,650
Industrial buildings.......... 18,590 33 17,975 1,100
Nursing/retirement............ 5,153 -- 6,035 --
Medical buildings............. 7,416 -- 7,577 --
Hotels/motels................. 237 -- 252 --
- ---------------------------------------------------------------------------------------
168,335 657 180,326 9,167
Less allowance for losses..... 1,500 -- 1,500 --
- ---------------------------------------------------------------------------------------
$166,835 $657 $178,826 $9,167
- ---------------------------------------------------------------------------------------
</TABLE>
Mortgage loan fundings are restricted by state insurance regulatory authority to
80 percent or less of the market value of the real estate at the time of
origination of the loan. The Company holds the mortgage document, which gives it
the right to take possession of the property if the borrower fails to perform
according to the terms of the agreement. The fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage interest rates
currently offered for mortgages of similar maturities. Commitments to purchase
mortgages are made in the ordinary course of business. The fair value of the
mortgage commitments is $nil.
F-13
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
2. INVESTMENTS (CONTINUED)
At December 31, 1998 and 1997, the Company's recorded investment in impaired
loans was $1,268 and $1,299, with allowances of $300 and $300, respectively.
During 1998 and 1997, the average recorded investment in impaired loans was
$1,282 and $1,312, respectively.
The Company recognized $123, $126 and $152 of interest income related to
impaired loans for the years ended December 31, 1998, 1997 and 1996,
respectively.
The following table presents changes in the allowance for investment losses
related to all loans:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -----------------------------------------------------------
Balance, January 1................. $1,500 $1,300 $ 445
Provision for investment losses.... -- 200 855
- -----------------------------------------------------------
Balance, December 31............... $1,500 $1,500 $1,300
- -----------------------------------------------------------
</TABLE>
Net investment income for the years ended December 31 is summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -----------------------------------------------------------------
Interest on fixed maturities....... $ 85,164 $ 92,007 $ 95,574
Interest on mortgage loans......... 14,599 14,228 14,171
Other investment income............ 3,365 1,715 1,293
Interest on cash equivalents....... 64 91 67
- -----------------------------------------------------------------
103,192 108,041 111,105
Less investment expenses........... 2,321 1,767 1,637
- -----------------------------------------------------------------
$100,871 $106,274 $109,468
- -----------------------------------------------------------------
</TABLE>
Net realized gains (losses) on investments for the years ended December 31 is
summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- -------------------------------------------------------------
Fixed maturities................... $2,018 $ 844 $ (572)
Mortgage loans..................... -- (200) (855)
Other investments.................. 145 (97) 3
- -------------------------------------------------------------
$2,163 $ 547 $(1,424)
- -------------------------------------------------------------
</TABLE>
Changes in net unrealized appreciation (depreciation) of investments for the
years ended December 31 are summarized as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
Fixed maturities available for
sale............................... $(3,347) $9,599 $(13,215)
- --------------------------------------------------------------
</TABLE>
F-14
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
3. INCOME TAXES
The Company qualifies as a life insurance company for federal income tax
purposes. As such, the Company is subject to the
Internal Revenue Code provisions applicable to life insurance companies.
The income tax expense (benefit) for the years ending December 31 consists of
the following:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------
Federal income taxes:
Current............................ $20,192 $16,371 $15,735
Deferred........................... (2,369) (960) (2,095)
- --------------------------------------------------------------
17,823 15,411 13,640
State income taxes-current......... 1,275 1,060 1,000
- --------------------------------------------------------------
Income tax expense................. $19,098 $16,471 $14,640
- --------------------------------------------------------------
</TABLE>
Increases (decreases) to the federal tax provision applicable to pretax income
based on the statutory rate are attributable to:
<TABLE>
<CAPTION>
1998 1997 1996
- -----------------------------------------------------------------------------------------------
PROVISION RATE PROVISION RATE PROVISION RATE
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Federal income taxes
based on the statutory
rate..................... $19,406 35.0% $16,677 35.0% $14,813 35.0%
Increases (decreases) are
attributable to:
Tax-excluded interest and
dividend income.......... (660) (1.2) (569) (1.2) (458) (1.1)
State tax, net of federal
benefit.................. 829 1.5 689 1.4 650 1.5
Other, net............... (477) (0.9) (326) (0.6) (365) (0.8)
- -----------------------------------------------------------------------------------------------
Federal income taxes..... $19,098 34.4% $16,471 34.6% $14,640 34.6%
- -----------------------------------------------------------------------------------------------
</TABLE>
A portion of life insurance company income earned prior to 1984 was not subject
to current taxation but was accumulated, for tax purposes, in a "policyholders'
surplus account." At December 31, 1998, the Company had a policyholders' surplus
account balance of $798. The policyholders' surplus account is only taxable if
dividends to the stockholder exceed the stockholder's surplus account or if the
Company is liquidated. Deferred income taxes of $279 have not been established
because no distributions of such amounts are contemplated.
Significant components of the Company's deferred income tax assets and
liabilities as of December 31 are as follows:
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
- ----------------------------------------------------------
Deferred income tax assets:
Policy reserves......................... $29,318 $28,922
Other................................... 6,502 5,467
- ----------------------------------------------------------
Total deferred income tax assets........ 35,820 34,389
- ----------------------------------------------------------
Deferred income tax liabilities:
Deferred policy acquisition costs....... 36,673 36,594
Investments............................. 7,059 9,240
- ----------------------------------------------------------
Total deferred income tax liabilities... 43,732 45,834
- ----------------------------------------------------------
Net deferred income tax liabilities..... $ 7,912 $11,445
- ----------------------------------------------------------
</TABLE>
F-15
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
3. INCOME TAXES (CONTINUED)
The Company is required to establish a valuation allowance for any portion of
the deferred income tax assets that management believes will not be realized. In
the opinion of management, it is more likely than not that the Company will
realize the benefit of the deferred tax assets and, therefore, no such valuation
allowance has been established.
- --------------------------------------------------------------------------------
4. STOCKHOLDER'S EQUITY
Retained earnings available for distribution as dividends to the parent are
limited to the Company's surplus as determined in accordance with accounting
practices prescribed by the New York Department of Insurance. All dividend
distributions must be approved by the New York Department of Insurance.
Statutory unassigned surplus aggregated $132,702 and $115,828 as of December 31,
1998 and 1997, respectively (see Note 3 with respect to the income tax effect of
certain distributions and Note 11 for a reconciliation of net income and
stockholder's equity per the accompanying financial statements to statutory net
income and surplus).
- --------------------------------------------------------------------------------
5. BENEFIT PLANS
The Company participates in the American Express Company Retirement Plan which
covers all permanent employees age 21 and over who have met certain employment
requirements. Employer contributions to the plan are based on participants' age,
years of service and total compensation for the year. Funding of retirement
costs for this plan complies with the applicable minimum funding requirements
specified by ERISA. The Company's share of the total net periodic pension cost
was $37, $39 and $34 in 1998, 1997 and 1996, respectively.
The Company has a "Sales Benefit Plan" which is an unfunded, noncontributory
retirement plan for all eligible financial advisors. Total plan costs for 1998,
1997 and 1996, which are calculated on the basis of commission earnings of the
individual financial advisors, were $1,480, $1,965 and $1,474, respectively.
Such costs are included in deferred policy acquisition costs.
The Company also participates in defined contribution pension plans of American
Express Company which cover all employees who have met certain employment
requirements. Company contributions to the plans are a percent of either each
employee's eligible compensation or basic contributions. Costs of these plans
charged to operations in 1998, 1997 and 1996 were $252, $312 and $248,
respectively.
The Company participates in defined benefit health care plans of AEFC that
provide health care and life insurance benefits to retired employees and retired
financial advisors. The plans include participant contributions and
service-related eligibility requirements. Upon retirement, such employees are
considered to have been employees of AEFC. Costs of these plans charged to
operations in 1998, 1997 and 1996 were $nil.
F-16
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
6. INCENTIVE PLAN AND RELATED PARTY OPERATING EXPENSES
The Company maintains a "Persistency Payment Plan." Under the terms of this
plan, financial advisors earn additional compensation based on the volume and
persistency of insurance sales. The total costs for the plan for 1998, 1997 and
1996 were $140, $1,490 and $1,424, respectively. Such costs are included in
deferred policy acquisition costs.
Charges by IDS Life and AEFC for the use of joint facilities, marketing services
and other services aggregated $9,403, $11,589 and $12,389 for 1998, 1997 and
1996, respectively. Certain of these costs are included in deferred policy
acquisition costs.
- --------------------------------------------------------------------------------
7. COMMITMENTS AND CONTINGENCIES
A number of lawsuits have been filed against life and health insurers in
jurisdictions in which the Company conducts business involving insurers' sales
practices, alleged agent misconduct, failure to properly supervise agents, and
other matters. The Company, along with AEFC and its insurance subsidiaries, has
been named as a defendant in one of these types of actions.
The plaintiffs purport to represent a class consisting of all persons who
purchased policies or contracts from IDS Life and its subsidiaries. The
complaint puts at issue various alleged sales practices and misrepresentations,
alleged breaches of fiduciary duties and alleged violations of consumer fraud
statutes. IDS Life and its subsidiaries believe they have meritorious defenses
to the claims raised in this lawsuit.
The outcome of any litigation cannot be predicted with certainty. In the opinion
of management, however, the ultimate resolution of this lawsuit should not have
a material adverse effect on the Company's financial position.
At December 31, 1998 and 1997, traditional life insurance and universal
life-type insurance in force aggregated $4,941,727 and $4,513,251, respectively,
of which $248,280 and $221,798 were reinsured at the respective year ends.
In addition, the Company has a stop loss reinsurance agreement with IDS Life
covering ordinary life benefits. IDS Life agrees to pay all death benefits
incurred each year which exceed 125 percent of normal claims, where normal
claims are defined in the agreement as .095 percent of the mean retained life
insurance in force. Premiums ceded to IDS Life amounted to $74, $115 and $98 for
the years ended December 31, 1998, 1997 and 1996, respectively. Claim recoveries
under the terms of this reinsurance agreement were $nil, $963 and $861 in 1998,
1997 and 1996, respectively.
Premiums ceded to reinsurers other than IDS Life amounted to $2,178, $1,583 and
$747 for the years ended December 31, 1998, 1997 and 1996, respectively. Claim
recoveries from reinsurers other than IDS Life amounted to $228, $1,366 and $66
for the years ended December 31, 1998, 1997 and 1996, respectively.
Reinsurance contracts do not relieve the Company from its primary obligations to
policyholders.
The Company has an agreement to assume a block of extended term life insurance
business. The amount of insurance in force related to this agreement was
$267,806 and $303,263 at December 31, 1998 and 1997, respectively. The
accompanying statement of income includes premiums of $nil for the years ended
December 31, 1998, 1997 and 1996, and decreases in liabilities for future policy
benefits of $1,742, $1,889 and $2,010 related to this agreement for the years
ended December 31, 1998, 1997 and 1996, respectively.
F-17
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
8. LINES OF CREDIT
The Company has an available line of credit with AEFC aggregating $25,000. The
interest rate for the line of credit is AEFC's cost of funds, ranging from 20 to
45 basis points over an established index. There were no borrowings outstanding
under this agreement at December 31, 1998 or 1997.
- --------------------------------------------------------------------------------
9. DERIVATIVE FINANCIAL INSTRUMENTS
The Company enters into transactions involving derivative financial instruments
to manage its exposure to interest rate risk, including hedging specific
transactions. The Company does not hold derivative instruments for trading
purposes. The Company manages risks associated with these instruments as
described below.
Market risk is the possibility that the value of the derivative financial
instruments will change due to fluctuations in a factor from which the
instrument derives its value, primarily an interest rate. The Company is not
impacted by market risk related to derivatives held for non-trading purposes
beyond that inherent in cash market transactions. Derivatives are largely used
to manage risk and, therefore, the cash flow and income effects of the
derivatives are inverse to the effects of the underlying transactions.
Credit risk is the possibility that the counterparty will not fulfill the terms
of the contract. The Company monitors credit risk related to derivative
financial instruments through established approval procedures, including setting
concentration limits by counterparty and industry, and requiring collateral,
where appropriate. A vast majority of the Company's counterparties are rated A
or better by Moody's and Standard & Poor's.
Credit risk related to interest rate caps is measured by replacement cost of the
contracts. The replacement cost represents the fair value of the instruments.
The notional or contract amount of a derivative financial instrument is
generally used to calculate the cash flows that are received or paid over the
life of the agreement. Notional amounts are not recorded on the balance sheet.
Notional amounts far exceed the related credit exposure.
The Company's holdings of derivative financial instruments are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1998 NOTIONAL CARRYING FAIR TOTAL CREDIT
ASSETS: AMOUNT AMOUNT VALUE EXPOSURE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------
Assets:
Interest rate caps............ $200,000 $566 $ 2 $ 2
- ----------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1997 NOTIONAL CARRYING FAIR TOTAL CREDIT
ASSETS: AMOUNT AMOUNT VALUE EXPOSURE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------
Assets:
Interest rate caps............ $200,000 $970 $62 $62
- ----------------------------------------------------------------------------
</TABLE>
The fair values of derivative financial instruments are based on market values,
dealer quotes or pricing models. The interest rate caps expire in the year 2000.
Interest rate caps are used to manage the Company's exposure to interest rate
risk. These instruments are used primarily to protect the margin between
interest rates earned on investments and the interest rates credited to related
annuity contract holders.
F-18
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
10. FAIR VALUES OF FINANCIAL INSTRUMENTS
The Company discloses fair value information for most on- and off-balance sheet
financial instruments for which it is practicable to estimate that value. Fair
values of life insurance obligations, receivables and all non-financial
instruments, such as deferred acquisition costs, are excluded. Off-balance sheet
intangible assets, such as the value of the field force, are also excluded.
Management believes the value of excluded assets and liabilities is significant.
The fair value of the Company, therefore, cannot be estimated by aggregating the
amounts presented.
<TABLE>
<CAPTION>
1998 1997
- ------------------------------------------------------------------------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------
FINANCIAL ASSETS:
Investments:
Fixed maturities (Note 2):
Held to maturity.............. $ 473,592 $ 503,909 $ 535,651 $ 562,979
Available for sale............ 578,591 578,591 603,576 603,576
Mortgage loans on real estate
(Note 2)...................... 166,835 178,559 178,826 187,992
Other:
Derivative financial
instruments (Note 9).......... 566 2 970 62
Separate accounts assets (Note
1)............................ 1,491,679 1,491,679 1,236,759 1,236,759
FINANCIAL LIABILITIES
Future policy benefits for
fixed annuities............... 788,780 765,430 880,809 852,391
Separate account
liabilities................... 1,355,430 1,302,422 1,136,408 1,086,565
- ------------------------------------------------------------------------------
</TABLE>
At December 31, 1998 and 1997, the carrying amount and fair value of future
policy benefits for fixed annuities exclude life insurance-related contracts
carried at $81,358 and $78,853, respectively, and policy loans of $5,369 and
$4,821, respectively. The fair value of these benefits is based on the status of
the annuities at December 31, 1998 and 1997. The fair value of deferred
annuities is estimated as the carrying amount less any surrender charges and
related loans. The fair value for annuities in non-life contingent payout status
is estimated as the present value of projected benefit payments at rates
appropriate for contracts issued in 1998 and 1997.
At December 31, 1998 and 1997, the fair value of liabilities related to separate
accounts is estimated as the carrying amount less applicable surrender charges
and less variable insurance contracts carried at $136,249 and $100,351,
respectively.
F-19
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
11. STATUTORY INSURANCE ACCOUNTING PRACTICES
Reconciliations of net income for the years ended December 31 and stockholder's
equity at December 31, as shown in the accompanying financial statements, to
that determined using statutory accounting practices are as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------------
Net income, per accompanying
financial statements............... $ 36,348 $ 31,178 $ 27,684
Deferred policy acquisition
costs.............................. (2,841) (7,432) (9,087)
Adjustments of future policy
benefit liabilities................ (6,199) (4,928) (9,683)
Deferred income tax benefit........ (2,369) (960) (2,095)
Provision for losses on
investments........................ 862 296 877
IMR gain/loss transfer and
amortization....................... (1,451) (119) 1,010
Adjustment to separate account
reserves........................... 2,767 10,267 8,863
Other, net......................... (350) 430 116
- --------------------------------------------------------------------
Net income, on basis of statutory
accounting practices............... $ 26,767 $ 28,732 $ 17,685
- --------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
- --------------------------------------------------------------------
Stockholder's equity, per
accompanying financial
statements......................... $ 279,466 $ 257,279 $ 229,863
Deferred policy acquisition
costs.............................. (129,477) (126,614) (119,183)
Adjustments of future policy
benefit liabilities................ 4,697 9,452 13,458
Deferred income taxes.............. 7,912 11,445 9,046
Asset valuation reserve............ (15,516) (16,698) (19,446)
Adjustments of separate account
liabilities........................ 56,223 53,456 43,189
Adjustments of investments to
amortized cost..................... (17,266) (20,613) (11,016)
Premiums due, deferred and
advance............................ 1,381 1,237 1,149
Deferred revenue liability......... 2,482 1,941 1,342
Allowance for losses............... 1,500 1,645 1,349
Non-admitted assets................ (450) (552) (634)
Interest maintenance reserve....... (3,001) (1,551) (1,432)
Other, net......................... (2,915) (1,463) (281)
- --------------------------------------------------------------------
Stockholder's equity, on basis of
statutory accounting practices..... $ 185,036 $ 168,963 $ 147,404
- --------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
12. YEAR 2000 ISSUE (UNAUDITED)
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of the Company. All of the
systems used by the Company are maintained by AEFC and are utilized by multiple
subsidiaries and affiliates of AEFC. The Company's business is heavily dependent
upon AEFC's computer systems and has significant interactions with systems of
third parties.
A comprehensive review of AEFC's computer systems and business processes,
including those specific to the Company, has been conducted to identify the
major systems that could be affected by the Year 2000 issue. Steps are being
taken to resolve any potential problems including modification to existing
software and the purchase of new software. These measures are scheduled to be
completed and tested on a timely basis. AEFC's target date for substantially
completing corrective measures on business critical systems was December 31,
1998. Substantial testing of these systems was targeted for completion early in
1999. Testing of these systems is targeted for completion early in 1999. AEFC is
currently on track with this schedule and is also on track to finish the work on
non-critical systems by June 30, 1999.
AEFC continues to evaluate the Year 2000 readiness of advisors and other third
parties
F-20
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
NOTES TO FINANCIAL STATEMENTS ($ THOUSANDS) (CONTINUED)
- --------------------------------------------------------------------------------
12. YEAR 2000 ISSUE (UNAUDITED) (CONTINUED)
whose system failures could have an impact on the Company's operations. The
potential materiality of any such impact is not known at this time.
AEFC's Year 2000 project includes establishing Year 2000 contingency plans for
all key business units. Business continuation plans, which address business
continuation in the event of a system disruption, are in place for all key
business units. These plans are being amended to include specific Year 2000
considerations and will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
F-21
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF IDS LIFE INSURANCE COMPANY)
- -----------------------------------------------------------------
REPORT OF INDEPENDENT AUDITORS
The Board of Directors
IDS Life Insurance Company of New York
We have audited the accompanying balance sheets of IDS Life Insurance Company of
New York (a wholly owned subsidiary of IDS Life Insurance Company) as of
December 31, 1998 and 1997, and the related statements of income, stockholder's
equity and cash flows for each of the three years in the period ended December
31, 1998. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of IDS Life Insurance Company of
New York at December 31, 1998 and 1997, and the results of its operations and
its cash flows for each of the three years in the period ended December 31,
1998, in conformity with generally accepted accounting principles.
Ernst & Young LLP
February 4, 1999
Minneapolis, Minnesota
F-22
<PAGE>
PART C.
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part B of this Registration Statement:
IDS Life of New York Account SBS:
Statements of Net Assets for year ended Dec. 31, 1998.
Statements of Operations for year ended Dec. 31, 1998.
Statements of Changes in Net Assets for year ended Dec. 31,
1998 and 1997.
Notes to Financial Statements.
Report of Independent Auditors dated March 13, 1999.
IDS Life Insurance Company of New York:
Balance Sheets as of Dec. 31, 1998 and Dec. 31, 1997.
Statements of Income for years ended Dec. 31, 1998, 1997 and
1996.
Statements of Stockholder's Equity, for years ended Dec. 31,
1998, 1997 and 1996.
Statements of Cash Flows for years ended Dec. 31, 1998, 1997
and 1996.
Notes to Financial Statements.
Report of Independent Auditors dated February 5, 1999.
(b) Exhibits:
1.1 Copy of Resolution of the Board of Directors of IDS Life Insurance Company
of New York establishing Account SLB on October 8, 1991, filed
electronically as Exhibit 1.1 to Registrant's Post-Effective Amendment No.
5 to Registration Statement No. 33-45776 is incorporated herein by
reference.
1.2 Copy of Consent in Writing in Lieu of a Meeting of Resolution of the Board
of Directors of IDS Life Insurance Company of New York Account SLB
establishing three additional subaccounts on October 8, 1991, filed
electronically as Exhibit 1.2 to Registrant's Post-Effective Amendment No.
5 to Registration Statement No. 33-45776 is incorporated herein by
reference.
2. Not applicable.
3. Form of Distribution Agreement between IDS Life Insurance Company of New
York and Shearson Lehman Brothers Inc., the principal underwriter, filed
electronically as Exhibit 3 to Post-Effective Amendment No. 5 to
Registration Statement No. 33-45776 is incorporated herein be reference.
4.1 Revised form of Group Flexible Premium Deferred Combination Fixed and
Variable Annuity Contract (No. 39377 GP) filed electronically as Exhibit
4.1 to Registrant's Post-Effective Amendment No. 5 to Registration
Statement No. 33-45776 is incorporated herein by reference.
4.2 Copy of Group Deferred Variable Annuity Certificate (No. 39377) filed
electronically as Exhibit 4.2 to Registrant's Post-Effective Amendment No.
5 to Registration Statement No. 33-45776 is incorporated herein by
reference.
<PAGE>
5.1 Revised form of Group Deferred Variable Annuity Application (No. 38614 GP)
filed electronically as Exhibit 5.1 to Registrant's Post-Effective
Amendment No. 5 to Registration Statement No. 33-45776 is incorporated
herein by reference.
5.2 Copy of Variable Annuity Group Enrollment Application (No. 38614) filed
electronically as Exhibit 5.2 to Registrant's Post-Effective Amendment No.
5 to Registration Statement No. 33-45776 is incorporated herein by
reference.
6.1 Copy of the Revised Charter of IDS Life of New York, dated April 1992,
filed electronically as Exhibit 6.1 to Registrant's Post-Effective
Amendment No. 4 to Registration Statement No. 33-45776/811-6560 is hereby
incorporated by reference.
6.2 Copy of the Amended By-Laws of IDS Life of New York, dated May 1992, filed
electronically as Exhibit 6.1 to Registrant's Post-Effective Amendment No.
4 to Registration Statement No. 33-45776/811-6560 is hereby incorporated by
reference.
7. Not applicable.
8. Not applicable.
9. Opinion of counsel and consent to its use as to the legality of the
securities being registered, dated April 28, 1999, filed electronically
herewith.
10. Consent of Independent Auditors, filed electronically herewith.
11. None.
12. Not applicable.
13. Copy of schedule for computation of each performance quotation provided in
the Registration Statement in response to Item 21, filed electronically as
Exhibit 13 to Registrant's Post-Effective Amendment No. 5 to Registration
Statement No. 33-45776 is incorporated herein by reference.
14. Power of Attorney to sign this Registration Statement dated April 14, 1999,
filed electronically herewith.
<PAGE>
Item 25. Directors and Officers of the Depositor (IDS Life Insurance Company of
New York)
<TABLE>
<CAPTION>
<S> <C> <C>
Name Principal Business Address Positions and Offices with Depositor
- ------------------------------------- ----------------------------------------- -------------------------------------
Timothy V. Bechtold IDS Tower 10 Director and President
Minneapolis, MN 55440
Maureen A. Buckley 20 Madison Ave. Extension Director, Vice President, Chief
Albany, NY Operating Officer and Consumer
Affairs Officer
Rodney P. Burwell Xerxes Corporation Director
790 Xerxes Ave. So.
Minneapolis, MN
John R. Cattau 20 Madison Ave. Extension Director
Albany, NY
James E. Choat IDS Tower 10 Executive Vice President,
Minneapolis, MN 55440 Institutional Products Group
Robert R. Grew 20 Madison Avenue Extension Director
Albany, NY
Lorraine R. Hart IDS Tower 10 Vice President, Investments
Minneapolis, MN 55440
Jay C. Hatlestad IDS Tower 10 Vice President and Controller,
Minneapolis, MN 55440 Assured Assets
Jeffrey S. Horton IDS Tower 10 Vice President and Treasurer
Minneapolis, MN 55440
Jean B. Keffeler 3424 Zenith Ave. So. Director
Minneapolis, MN
Richard W. Kling IDS Tower 10 Director and Chairman of the Board
Minneapolis, MN 55440
Bruce A. Kohn IDS Tower 10 Counsel and Assistant Secretary
Minneapolis, MN 55440
Eric L. Marhoun IDS Tower 10 General Counsel and Secretary
Minneapolis, MN 55440
Thomas R. McBurney 1700 Foshay Tower Director
821 Marquette Ave.
Minneapolis, MN
Mary Ellyn Minenko IDS Tower 10 Counsel and Assistant Secretary
Minneapolis, MN 55440
Edward J. Muhl IDS Tower 10 Director
Minneapolis, MN 55440
<PAGE>
Thomas V. Nicolosi Suite 220 Director
500 Mamaroneck Avenue
Harrison, NY 10528
Stephen P. Norman World Financial Center Director
New York, NY
F. Dale Simmons IDS Tower 10 Vice President, Real Estate Loan
Minneapolis, MN 55440 Management
Richard M. Starr 20 Madison Avenue Extension Director
Albany, NY
William A. Stoltzmann IDS Tower 10 Counsel and Assistant Secretary
Minneapolis, MN 55440
Philip C. Wentzel IDS Tower 10 Vice President and Controller, Risk
Minneapolis, MN 55440 Management
Michael R. Woodward 20 Madison Avenue Extension Director
Albany, NY
</TABLE>
Item 26. Persons Controlled by or Under Common Control with the Depositor or
Registrant
IDS Life Insurance Company of New York is a wholly-owned
subsidiary of IDS Life Insurance Company which is a
wholly-owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is a
wholly-owned subsidiary of American Express Company (American
Express).
The following list includes the names of major subsidiaries of
American Express.
<TABLE>
<CAPTION>
<S> <C>
Jurisdiction of
Name of Subsidiary Incorporation
I. Travel Related Services
American Express Travel Related Services Company, Inc. New York
II. International Banking Services
American Express Bank Ltd. Connecticut
III. Companies engaged in Financial Services
Advisory Capital Partners LLC Delaware
Advisory Capital Strategies Group Inc. Minnesota
American Centurion Life Assurance Company New York
American Enterprise Investment Services Inc. Minnesota
American Enterprise Life Insurance Company Indiana
American Express Asset Management Group Inc. Minnesota
American Express Asset Management International Inc. Delaware
American Express Asset Management International (Japan) Ltd. Japan
American Express Asset Management Ltd. England
American Express Client Service Corporation Minnesota
American Express Corporation Delaware
American Express Financial Advisors Inc. Delaware
American Express Financial Advisors Japan Inc. Delaware
American Express Financial Corporation Delaware
<PAGE>
American Express Insurance Agency of Arizona Inc. Arizona
American Express Insurance Agency of Idaho Inc. Idaho
American Express Insurance Agency of Nevada Inc. Nevada
American Express Insurance Agency of Oregon Inc. Oregon
American Express Minnesota Foundation Minnesota
American Express Property Casualty Insurance Agency of Kentucky Inc. Kentucky
American Express Property Casualty Insurance Agency of Maryland Inc. Maryland
American Express Property Casualty Insurance Agency of Mississippi Inc. Mississippi
American Express Property Casualty Insurance Agency of Pennsylvania Inc. Pennsylvania
American Express Trust Company Minnesota
American Partners Life Insurance Company Arizona
IDS Cable Corporation Minnesota
IDS Cable II Corporation Minnesota
IDS Capital Holdings Inc. Minnesota
IDS Certificate Company Delaware
IDS Futures Brokerage Group Minnesota
IDS Futures Corporation Minnesota
IDS Insurance Agency of Alabama Inc. Alabama
IDS Insurance Agency of Arkansas Inc. Arkansas
IDS Insurance Agency of Massachusetts Inc. Massachusetts
IDS Insurance Agency of Mississippi Ltd. Mississippi
IDS Insurance Agency of New Mexico Inc. New Mexico
IDS Insurance Agency of North Carolina Inc. North Carolina
IDS Insurance Agency of Ohio Inc. Ohio
IDS Insurance Agency of Texas Inc. Texas
IDS Insurance Agency of Utah Inc. Utah
IDS Insurance Agency of Wyoming Inc. Wyoming
IDS Life Insurance Company Minnesota
IDS Life Insurance Company of New York New York
IDS Management Corporation Minnesota
IDS Partnership Services Corporation Minnesota
IDS Plan Services of California, Inc. Minnesota
IDS Property Casualty Insurance Company Wisconsin
IDS Real Estate Services, Inc. Delaware
IDS Realty Corporation Minnesota
IDS Sales Support Inc. Minnesota
Investors Syndicate Development Corp. Nevada
Public Employee Payment Company Minnesota
</TABLE>
Item 27. Number of Contractowners
On March 31, 1999, there were 64 contract owners of qualified
contracts. There were 293 owners of nonqualified contracts.
Item 28. Indemnification
The By-Laws of the depositor provide that to the extent
permitted and in the manner prescribed by law, the Corporation
shall indemnify any person made, or threatened to be made, a
party to any action, suit or proceeding, civil or criminal, by
reason of the fact that he, his testator or intestate, is or
was Director or Officer of the Corporation or of any other
corporation of any type or kind, domestic or foreign, which he
served in any capacity at the request of the Corporation,
against judgments, fines, amounts paid in settlement and
reasonable expenses (which the Corporation may advance),
including attorneys' fees, actually and necessarily incurred
as a result of such action, suit or proceeding, or any appeal
therein.
<PAGE>
The foregoing right of indemnification shall not be exclusive
of any other right to which any such person may be entitled.
Neither the adoption of this provision nor any modification or
repeal hereof, or of any provision of any applicable law
shall, unless otherwise required by law, enlarge or diminish
any right of indemnification of a Director or Officer as it
existed at the time of accrual of the alleged cause of action
asserted in the threatened or pending action, suit or
proceeding in which the expenses were incurred or other amount
was paid.
The Board, in its discretion, may authorize the Corporation to
indemnify any person, other than a Director or Officer, for
expenses incurred or other amounts paid in any civil or
criminal action, suit or proceeding, to which such person was,
or was threatened to be, made a party by reason of the fact
that he, his testator or intestate, is or was an employee or
agent of the Corporation or of any other corporation of any
type or kind, domestic or foreign, which he served in any
capacity at the request of the Corporation, against judgments,
fines, amounts paid in settlement and reasonable expenses
(which the Corporation may advance), as a result of such
action, suit or proceeding, or any appeal therein.
Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to director, 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 the payment by the registrant of
expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by 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.
Item 29. Principal Underwriters.
(a) Smith Barney Inc. currently acts as principal underwriter for various
investment companies and various series of unit investment trusts.
SmithBarney Inc. is a wholly owned subsidiary of Smith Barney Holdings
Inc. ("Holdings") and an indirect wholly-owned subsidiary of The Travelers
Inc.
(b) The information required by this Item 29 with respect to each director and
officer of Smith Barney Inc. is incorporated by reference to Schedule A of
Form BD filed by Smith Barney Inc. pursuant to the Securities Exchange Act
of 1934.
(c) Not applicable.
<PAGE>
Item 30. Location of Accounts and Records
IDS Life Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a), (b) & (c) These undertakings were filed with Pre-Effective Amendment No. 1
to Registration Statement No. 33-45776/811-6560.
(d) The sponsoring insurance company represents that the fees and charges
deducted under the contract, in the aggregate, are reasonable in relation
to the services rendered, the expenses expected to be incurred, and the
risks assumed by the insurance company.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, IDS Life Insurance Company of New York, on behalf of the Registrant,
certifies that it meets the requirements for effectiveness of this Amendment to
its Registration Statement pursuant to Rule 485(b) under the Securities Act of
1933 and has duly caused this Registration Statement to be signed on its behalf
in the City of Minneapolis, and State of Minnesota, on the 28th day of April,
1999.
IDS LIFE OF NEW YORK ACCOUNT SBS
(Registrant)
By IDS Life Insurance Company of New York
(Sponsor)
By /s/ Timothy V. Bechtold*
Timothy V. Bechtold
President
As required by the Securities Act of 1933, this Registration Statement has been
signed by the following persons in the capacities indicated on the 28th day of
April, 1999.
Signature Title
/s/ Richard W. Kling* Director and Chairman of the
Richard W. Kling Board
/s/ Timothy V. Bechtold* Director and President
Timothy V. Bechtold
/s/ Maureen A. Buckley* Director, Vice President, Chief Operating
Marueen A. Buckley Officer and Consumer Affairs Officer
/s/ Rodney P. Burwell* Director
Rodney P. Burwell
/s/ John R. Cattau* Director
John R. Cattau
/s/ Robert R. Grew* Director
Robert R. Grew
/s/ Jeffrey S. Horton* Vice President and Treasurer
Jeffrey S. Horton
/s/ Jean B. Keffeler* Director
Jean B. Keffeler
/s/ Thomas R. McBurney* Director
Thomas R. McBurney
/s/ Edward J. Muhl Director
Edward J. Muhl
<PAGE>
Signature Title
/s/ Thomas V. Nicolosi* Director
Thomas V. Nicolosi
/s/ Stephen P. Norman* Director
Steven P. Norman
/s/ Philip C. Wentzel* Vice President and
Philip C. Wentzel Controller - Risk Management
/s/ Richard M. Starr* Director
Richard M. Starr
/s/ Michael R. Woodward* Director
Michael R. Woodward
*Signed pursuant to Power of Attorney, dated April 14, 1999, filed
electronically herewith.
/s/Mary Ellyn Minenko
Mary Ellyn Minenko
<PAGE>
CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 9
This Registration Statement is comprised of the following papers and documents:
The Cover Page.
Part A.
The prospectus.
Part B.
Statement of Additional Information.
Financial Statements.
Part C.
Other Information.
The signatures.
Exhibits.
<PAGE>
IDS LIFE OF NEW YORK ACCOUNT SBS (Symphony - NY)
Registration No. 33-45776/811-6560
EXHIBIT INDEX
9. Opinion of Counsel and Consent.
10. Consent of Independent Auditors.
14. Power of Attorney
<PAGE>
April 28, 1999
IDS Life Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
RE: IDS Life of New York Account SBS
File No.: 33-45776/811-6560
Ladies and Gentlemen:
I am familiar with the establishment of the IDS Life of New York Account SBS
("Account"), which is a separate account of IDS Life Insurance Company of New
York ("Company") established by the Company's Board of Directors according to
applicable insurance law. I also am familiar with the above-referenced
Registration Statement filed by the Company on behalf of the Account with the
Securities and Exchange Commission.
I have made such examination of law and examined such documents and records as
in my judgment are necessary and appropriate to enable me to give the following
opinion:
1. The Company is duly incorporated, validly existing and in good standing
under applicable state law and is duly licensed or qualified to do business
in each jurisdiction where it transacts business. The Company has all
corporate powers required to carry on its business and to issue the
contracts.
2. The Account is a validly created and existing separate account of the
Company and is duly authorized to issue the securities registered.
3. The contracts issued by the Company, when offered and sold in accordance
with the prospectus contained in the Registration Statement and in
compliance with applicable law, will be legally issued and represent
binding obligations of the Company in accordance with their terms.
I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement.
Sincerely,
/s/Mary Ellyn Minenko
Mary Ellyn Minenko
Group Counsel
<PAGE>
Consent of Independent Auditors
We consent to the use of our report dated February 4, 1999 on the financial
statements IDS Life Insurance Company of New York and our report dated March 12,
1999 on the financial statements of IDS Life of New York Account SBS in
Post-Effective Amendment No. 9 to the Registration Statement (Form N-4, No.
33-45776) and related Prospectus for the registration of the Symphony Annuity
Certificates to be offered by IDS Life Insurance Company of New York.
/s/Ernst & Young LLP
Minneapolis, Minnesota
April 27, 1999
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
POWER OF ATTORNEY
City of Albany
State of New York
Each of the undersigned, as officers and/or directors of IDS Life Insurance
Company of New York on behalf of the below listed registrants previously have
filed registration statements and amendments thereto pursuant to the
requirements of the Securities Act of 1933 and the Investment Company Act of
1940 with the Securities and Exchange Commission:
<TABLE>
<CAPTION>
<S> <C> <C>
1933 Act 1940 Act
Reg. Number Reg. Number
IDS Life of New York 4, 5, 6, 9, 10, 11, 12, 13 and 14 33-52567 811-3500
IDS Life of New York Employee Benefit Annuity (EBA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Flexible Annuity (Flex-NY) 33-4174 811-3500
- -------------------------------------------------------------------------
IDS Life of New York Variable Retirement and Combination 2-78194 811-3500
Retirement Annuity (CRA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Flexible Portfolio Annuity Account 333-03867 811-07623
IDS Life of New York Flexible Portfolio Annuity (FPA-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account 8 33-15290 811-5213
Flexible Premium Variable Life Insurance Policy (VUL-NY)
- -------------------------------------------------------------------------
Flexible Premium Variable Life Insurance Policy (VUL-3-NY)
- -------------------------------------------------------------------------
Flexible Premium Survivorship Variable Life Insurance Policy 333-42257 811-5213
(V2D-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account SBS 33-45776 811-6560
Symphony Annuity (SYMPHONY-NY)
- -------------------------------------------------------------------------
IDS Life of New York Account 7 33-10334 811-4913
Single Premium Variable Life Insurance Policy (SBS-SPVL-NY)
</TABLE>
hereby constitutes and appoints William A. Stoltzmann, Mary Ellyn Minenko,
Eileen J. Newhouse, Eric L. Marhoun, Christopher R. Long and Timothy S. Meehan
or any one of them, as her or his attorney-in-fact and agent, to sign for her or
him in her or his name, place and stead any and all filings, applications
(including applications for exemptive relief), periodic reports, registration
statements for existing or future products (with all exhibits and other
documents required or desirable in connection therewith) other documents, and
amendments thereto and to file such filings, applications, periodic reports,
registration statements other documents, and amendments thereto with the
Securities and Exchange Commission, and any necessary states, and grants to any
or all of them the full power and authority to do and perform each and every act
required or necessary in connection therewith.
<PAGE>
Dated the 14 day of April, 1999.
/s/ Timothy V. Bechtold /s/ Thomas R. McBurney
Timothy V. Bechtold Thomas R. McBurney
Director and President Director
/s/ Maureen A. Buckley /s/ Edward J. Muhl
Maureen A. Buckley Edward J. Muhl
Director, Vice President, Chief Operating Director
Officer and Consumer Affairs
Officer
/s/ Rodney P. Burwell /s/ Thomas V. Nicolosi
Rodney P. Burwell Thomas V. Nicolosi
Director Director
/s/ John R. Cattau /s/ Stephen P. Norman
John R. Cattau Stephen P. Norman
Director Director
/s/ Robert R. Grew /s/ Richard M. Starr
Robert R. Grew Richard M. Starr
Director Director
/s/ Jeffrey S. Horton /s/ Philip C. Wentzel
Jeffrey S. Horton Philip C. Wentzel
Vice President and Treasurer Vice President and
Controller
/s/ Jean B. Keffeler /s/ Michael R. Woodward
Jean B. Keffeler Michael R. Woodward
Director Director
/s/ Richard W. Kling
Richard W. Kling
Director and Chairman of the Board
