SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 10 (File No. 33-45776) [x]
---------
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 11 (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)
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(Exact Name of Registrant)
IDS Life Insurance Company of New York
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(Name of Depositor)
20 Madison Avenue Extension, Albany, New York 12203
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(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 671-3678
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Mary Ellyn Minenko, 200 AXP Financial Center, MN 55474
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(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)
[X] on May 1, 2000 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)
[ ] on (date) pursuant to paragraph (a) 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/MAY 1, 2000
GROUP FLEXIBLE PREMIUM DEFERRED COMBINATION FIXED/VARIABLE ANNUITY.
IDS LIFE OF NEW YORK ACCOUNT SBS
Issued by: IDS LIFE INSURANCE COMPANY OF NEW YORK (IDS LIFE OF NEW YORK)
20 Madison Avenue Extension
P.O. Box 5144
Albany, NY 12205
Telephone: 800-724-0705
This prospectus contains information that you should know before investing. You
also will receive the following prospectuses:
- - American Express-Registered Trademark- Variable Portfolio Funds, and
- - Greenwich Street Series Fund
Please read both prospectuses carefully and keep them for future reference.
THE SECURITIES AND EXCHANGE COMMISSION (SEC) HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
AN INVESTMENT IN THIS CERTIFICATE 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 CERTIFICATE
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 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 the
last page of this prospectus. The table of contents of the SAI is on the last
page of this prospectus.
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PROSPECTUS -- MAY 1, 2000 1
<PAGE>
TABLE OF CONTENTS
KEY TERMS.................................... 3
THE CERTIFICATE IN BRIEF..................... 5
EXPENSE SUMMARY.............................. 7
CONDENSED FINANCIAL INFORMATION
(UNAUDITED)................................ 9
FINANCIAL STATEMENTS......................... 11
PERFORMANCE INFORMATION...................... 11
THE VARIABLE ACCOUNT AND THE FUNDS........... 12
THE FIXED ACCOUNT............................ 14
BUYING YOUR CERTIFICATE...................... 14
CHARGES...................................... 16
VALUING YOUR INVESTMENT...................... 18
MAKING THE MOST OF YOUR CERTIFICATE.......... 20
SURRENDERS................................... 22
TSA-SPECIAL SURRENDER PROVISIONS............. 23
CHANGING OWNERSHIP........................... 23
BENEFITS IN CASE OF DEATH.................... 24
THE ANNUITY PAYOUT PERIOD.................... 25
TAXES........................................ 26
VOTING RIGHTS................................ 28
ABOUT THE SERVICE PROVIDERS.................. 29
YEAR 2000.................................... 30
TABLE OF CONTENTS OF THE STATEMENT OF
ADDITIONAL INFORMATION..................... 31
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2 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
KEY TERMS
THESE TERMS CAN HELP YOU UNDERSTAND DETAILS ABOUT YOUR CERTIFICATE.
ACCUMULATION UNIT: A measure of the value of each 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 benefits in case of the owner's
or annuitant's death while the certificate is in force and before annuity
payouts begin.
CERTIFICATE: A deferred contract, or a certificate showing your interest under a
group annuity contract, that permits you to accumulate money for retirement by
making one or more purchase payments. It provides for lifetime or other forms of
payouts at a specified time in the future.
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.
CLOSE OF BUSINESS: When the New York Stock Exchange (NYSE) closes, normally 4
p.m. Eastern time.
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: Investment options under your certificate. You may allocate your purchase
payments into subaccounts 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) under Section 408(b) of the Internal
Revenue Code of 1986, as amended (the Code)
- - Simplified Employee Pension (SEP) plans under Section 408(k) of the Code
- - Plans under Section 401(k) of the Code
- - Custodial and trusteed pension and profit sharing plans under Section 401(a)
of the Code
- - Tax-Sheltered Annuities (TSAs) under Section 403(b) of the Code
A qualified annuity will not provide any necessary or additional tax-deferral if
it is used to fund a retirement plan that is already tax-deferred.
All other certificates are considered NONQUALIFIED ANNUITIES.
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PROSPECTUS -- MAY 1, 2000 3
<PAGE>
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 subaccount invests in shares of one fund. The value of
your investment in each subaccount changes with the performance of the
particular fund.
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4 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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 purchase payments; you may
allocate your purchase payments to the fixed account and/or variable account
under the certificate. These accounts, in turn, may earn returns that increase
the value of the certificate. Beginning at a specified time in the future called
the retirement date, the certificate provides lifetime or other forms of payouts
of your certificate value. 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.
A qualified annuity will not provide any necessary or additional tax-deferral if
it is used to fund a retirement plan that is tax-deferred. However, the
certificate has features other than tax-deferral that may make it an appropriate
investment for your retirement plan. You should compare these features and their
costs with other investment options before deciding to purchase this
certificate.
FREE LOOK PERIOD: You may return your certificate to your sales representative
or to our office within the time stated on the first page of your certificate
and receive a full refund of 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. 12)
- - the fixed account, which earns interest at a rate that we adjust
periodically. (p. 14)
BUYING YOUR CERTIFICATE: Your sales representative 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 accounts without charge at any time until annuity payouts begin.
You may establish automated transfers among the accounts. Fixed account
transfers are subject to special restrictions. (p. 17)
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. 22)
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. 23)
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. 24)
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PROSPECTUS -- MAY 1, 2000 5
<PAGE>
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. 25)
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. 26)
CHARGES: We assess certain charges in connection with your certificate:
- - $30 annual certificate administrative charge;
- - 0.25% variable account administrative charge;
- - 1.25% mortality and expense risk fee (if you allocate money to one or more
variable accounts);
- - surrender charge; and
- - the operating expenses of the funds in which the variable account invests.
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6 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
EXPENSE SUMMARY
The purpose of the following information 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 we deduct directly from your certificate or indirectly from the variable
accounts and funds below. Some expenses may vary as we explain under "Charges."
Please see the fund prospectuses for more information on the operating expenses
for each fund.
ANNUAL CERTIFICATE OWNERS EXPENSES:
SURRENDER CHARGE (contingent deferred sales charge as a percentage of purchase
payments surrendered)
<TABLE>
<CAPTION>
SURRENDER CHARGE
CERTIFICATE YEAR PERCENTAGE
<S> <C>
1 6%
2 5
3 4
4 3
5 2
6 1
7 and later 0
</TABLE>
CERTIFICATE ADMINISTRATIVE CHARGE
$30
ANNUAL SUBACCOUNT EXPENSES
(as a percentage of average subaccount value):
<TABLE>
<S> <C>
Variable account administrative charge 0.25%
Mortality and expense risk fee 1.25%
----
Total annual subaccount expenses 1.50%
</TABLE>
ANNUAL OPERATING EXPENSES OF THE FUNDS
(AFTER FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS, IF APPLICABLE, AS A
PERCENTAGE OF AVERAGE DAILY NET ASSETS)
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<TABLE>
<CAPTION>
MANAGEMENT 12B-1 OTHER
FEES FEES EXPENSES TOTAL
<S> <C> <C> <C> <C>
AXP--SM-- Variable Portfolio
-
Bond Fund .60% .13 .08 .81%(1)
Capital Resource Fund .60% .13 .06 .79%(1)
Managed Fund .59% .13 .04 .76%(1)
Appreciation Portfolio .75% -- .04 .79%(2)
Diversified Strategic Income
Portfolio .65% -- .13 .78%(2)
Emerging Growth Portfolio .95% -- .35 1.30%(2)
Equity Income Portfolio .65% -- .22 .87%(2)
Equity Index Portfolio --
Class I .21% -- .07 .28%(2)
Growth & Income Portfolio .65% -- .15 .80%(2)
Intermediate High Grade
Portfolio .60% -- .62 1.22%(2)
International Equity
Portfolio 1.05% -- .28 1.33%(2)
Money Market Portfolio .50% -- .75 1.25%(2)
Total Return Portfolio .75% -- .04 .79%(2)
</TABLE>
(1) The fund's expense figures are based on actual expenses for the fiscal year
ended Aug. 31, 1999 restated to include a Rule 12b-1 distribution fee of
.125% that went into effect Sept. 21, 1999.
(2) Figures in "Management Fees," "Other Expenses" and "Total" are based on
actual expenses for the fiscal period ended Dec. 31, 1999. Absent fee
waivers and expense reimbursements "Management Fees", "Other Expenses" and
"Total" would be 0.50%, 1.24% and 1.74% for Money Market Portfolio.
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PROSPECTUS -- MAY 1, 2000 7
<PAGE>
EXAMPLE:*
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return and....
<TABLE>
<CAPTION>
NO SURRENDER OR SELECTION
FULL SURRENDER AT THE OF AN ANNUITY PAYOUT PLAN AT THE
END OF EACH TIME PERIOD END OF EACH TIME PERIOD
1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
AXP--SM-- Variable
Portfolio -
Bond Fund $84.09 $114.15 $146.84 $270.99 $24.09 $74.15 $126.84 $270.99
Capital Resource Fund 83.88 113.54 145.82 268.94 23.88 73.54 125.82 268.94
Managed Fund 83.58 112.61 144.27 265.85 23.58 72.61 124.27 265.85
Appreciation Portfolio 83.88 113.54 145.82 268.94 23.88 73.54 125.82 268.94
Diversified Strategic
Income Portfolio 83.78 113.23 145.30 267.91 23.78 73.23 125.30 267.91
Emerging Growth
Portfolio 89.11 129.17 171.76 320.05 29.11 89.17 151.76 320.05
Equity Income Portfolio 84.70 116.00 149.92 277.13 24.70 76.00 129.92 277.13
Equity Index Portfolio
-- Class I 78.66 97.74 119.31 215.19 18.66 57.74 99.31 215.19
Growth & Income
Portfolio 83.99 113.84 146.33 269.97 23.99 73.84 126.33 269.97
Intermediate High Grade
Portfolio 88.29 126.73 167.73 312.20 28.29 86.73 147.73 312.20
International Equity
Portfolio 89.42 130.08 173.27 322.97 29.42 90.08 153.27 322.97
Money Market Portfolio 88.60 127.64 169.24 315.15 28.60 87.64 149.24 315.15
Total Return Portfolio 83.88 113.54 145.82 268.94 23.88 73.54 125.82 268.94
</TABLE>
* In this example, the $30 certificate administrative charge is approximated
as a 0.040% 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.
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8 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
CONDENSED FINANCIAL INFORMATION
(UNAUDITED)
The following tables give per-unit information about the financial history of
each subaccount.
<TABLE>
<CAPTION>
YEAR ENDED DEC. 31, 1999 1998 1997 1996 1995 1994 1993
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<S> <C> <C> <C> <C> <C> <C> <C>
SUBACCOUNT BSI(1) (INVESTING IN SHARES OF AXP--SM-- VARIABLE PORTFOLIO -- BOND FUND)
Accumulation unit
value at
beginning of
period $1.12 $1.12 $1.09 $1.12 $0.99 $1.00 --
Accumulation unit
value at end of
period $1.12 $1.12 $1.12 $1.09 $1.12 $0.99 --
Number of
accumulation
units outstanding
at end of period
(000 omitted) 13 15 13 -- -- -- --
Ratio of operating
expense to
average net
assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% --
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SUBACCOUNT BCR(1) (INVESTING IN SHARES OF AXP--SM-- VARIABLE PORTFOLIO -- CAPITAL RESOURCE
FUND)
Accumulation unit
value at
beginning of
period $1.79 $1.47 $1.20 $1.13 $1.01 $1.00 --
Accumulation unit
value at end of
period $2.19 $1.79 $1.47 $1.20 $1.13 $1.01 --
Number of
accumulation
units outstanding
at end of period
(000 omitted) 13 14 13 13 -- -- --
Ratio of operating
expense to
average net
assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% --
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SUBACCOUNT BMG(1) (INVESTING IN SHARES OF AXP--SM-- VARIABLE PORTFOLIO -- MANAGED FUND)
Accumulation unit
value at
beginning of
period $1.87 $1.64 $1.39 $1.21 $0.99 $1.00 --
Accumulation unit
value at end of
period $1.97 $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% 1.50% --
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SUBACCOUNT BAP(2) (INVESTING IN SHARES OF APPRECIATION PORTFOLIO)
Accumulation unit
value at
beginning of
period $2.20 $1.88 $1.51 $1.28 $1.01 $1.03 $1.00
Accumulation unit
value at end of
period $2.45 $2.20 $1.88 $1.51 $1.28 $1.01 $1.03
Number of
accumulation
units outstanding
at end of period
(000 omitted) 1,706 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% 1.50%
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SUBACCOUNT BDS(2) (INVESTING IN SHARES OF DIVERSIFIED STRATEGIC INCOME PORTFOLIO)
Accumulation unit
value at
beginning of
period $1.42 $1.36 $1.28 $1.16 $1.02 $1.06 $1.00
Accumulation unit
value at end of
period $1.43 $1.42 $1.36 $1.28 $1.16 $1.02 $1.06
Number of
accumulation
units outstanding
at end of period
(000 omitted) 913 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% 1.50%
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SUBACCOUNT BEG(3) (INVESTING IN SHARES OF EMERGING GROWTH PORTFOLIO)
Accumulation unit
value at
beginning of
period $2.50 $1.85 $1.55 $1.33 $0.95 $1.04 $1.00
Accumulation unit
value at end of
period $5.10 $2.50 $1.85 $1.55 $1.33 $0.95 $1.04
Number of
accumulation
units outstanding
at end of period
(000 omitted) 417 486 582 635 727 706 148
Ratio of operating
expense to
average net
assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
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SUBACCOUNT BEM(2) (INVESTING IN SHARES OF EQUITY INCOME PORTFOLIO)
Accumulation unit
value at
beginning of
period $1.73 $1.50 $1.23 $1.18 $0.90 $1.02 $1.00
Accumulation unit
value at end of
period $1.62 $1.73 $1.50 $1.23 $1.18 $0.90 $1.02
Number of
accumulation
units outstanding
at end of period
(000 omitted) 514 945 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% 1.50%
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</TABLE>
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PROSPECTUS -- MAY 1, 2000 9
<PAGE>
<TABLE>
<CAPTION>
YEAR ENDED DEC. 31, 1999 1998 1997 1996 1995 1994 1993
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
SUBACCOUNT BEX(2) (INVESTING IN SHARES OF EQUITY INDEX PORFOLIO -- CLASS I)
Accumulation unit
value at
beginning of
period $2.71 $2.14 $1.64 $1.37 $1.02 $1.03 $1.00
Accumulation unit
value at end of
period $3.22 $2.71 $2.14 $1.64 $1.37 $1.02 $1.03
Number of
accumulation
units outstanding
at end of period
(000 omitted) 334 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% 1.50%
- ---------------------------------------------------------------------------------------------
SUBACCOUNT BGI(2) (INVESTING IN SHARES OF GROWTH & INCOME PORFOLIO)
Accumulation unit
value at
beginning of
period $2.03 $1.84 $1.52 $1.29 $1.00 $1.05 $1.00
Accumulation unit
value at end of
period $2.21 $2.03 $1.84 $1.52 $1.29 $1.00 $1.05
Number of
accumulation
units outstanding
at end of period
(000 omitted) 848 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% 1.50%
- ---------------------------------------------------------------------------------------------
SUBACCOUNT BIH(2) (INVESTING IN SHARES OF INTERMEDIATE HIGH GRADE PORTFOLIO)
Accumulation unit
value at
beginning of
period $1.29 $1.22 $1.14 $1.14 $0.98 $1.03 $1.00
Accumulation unit
value at end of
period $1.22 $1.29 $1.22 $1.14 $1.14 $0.98 $1.03
Number of
accumulation
units outstanding
at end of period
(000 omitted) 1,324 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% 1.50%
- ---------------------------------------------------------------------------------------------
SUBACCOUNT BIE(3) (INVESTING IN SHARES OF INTERNATIONAL EQUITY PORTOFOLIO)
Accumulation unit
value at
beginning of
period $1.31 $1.12 $1.16 $0.97 $0.91 $1.00 $1.00
Accumulation unit
value at end of
period $2.15 $1.31 $1.12 $1.16 $0.97 $0.91 $1.00
Number of
accumulation
units outstanding
at end of period
(000 omitted) 629 888 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% 1.50%
- ---------------------------------------------------------------------------------------------
SUBACCOUNT BMO(2) (INVESTING IN SHARES OF MONEY MARKET PORTFOLIO)
Accumulation unit
value at
beginning of
period $1.16 $1.13 $1.10 $1.07 $1.03 $1.01 $1.00
Accumulation unit
value at end of
period $1.19 $1.16 $1.13 $1.10 $1.07 $1.03 $1.01
Number of
accumulation
units outstanding
at end of period
(000 omitted) 373 458 460 343 395 539 450
Ratio of operating
expense to
average net
assets 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% 1.50%
Simple yield(4) 2.90% 2.43% 3.05% 2.52% 2.75% 2.14% .70%
Compound yield(4) 2.94% 2.46% 3.09% 2.55% 2.79% 2.16% .70%
- ---------------------------------------------------------------------------------------------
SUBACCOUNT BTR(3) (INVESTING IN SHARES OF TOTAL RETURN PORTFOLIO)
Accumulation unit
value at
beginning of
period $1.97 $1.91 $1.66 $1.34 $1.09 $1.03 $1.00
Accumulation unit
value at end of
period $2.37 $1.97 $1.91 $1.66 $1.34 $1.09 $1.03
Number of
accumulation
units outstanding
at end of period
(000 omitted) 971 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% 1.50%
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</TABLE>
(1) Operations commenced on Nov. 28, 1994.
(2) Operations commenced on March 15, 1993.
(3) Operations commenced on Dec. 2, 1993.
(4) Net of annual certificate administrative charge and mortality and expense
risk fee.
- --------------------------------------------------------------------------------
10 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
FINANCIAL STATEMENTS
You can find the audited financial statements of the subaccounts with financial
history in the SAI. You can find our audited financial statements later in this
prospectus.
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 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:
- - 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 show optional total return quotations that do not reflect a surrender
charge deduction (assuming no surrender). We may show total return quotations 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 ten years (or up to the life of
the 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 generally will be higher than average annual
total return.
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 the first page of this
prospectus.
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 11
<PAGE>
THE VARIABLE ACCOUNT AND THE FUNDS
You may allocate payments to any or all of the subaccounts of the variable
account that invest in shares of the following funds:
<TABLE>
<CAPTION>
SUBACCOUNT INVESTING IN INVESTMENT OBJECTIVES AND POLICIES INVESTMENT ADVISOR OR MANAGER
<C> <S> <C> <C>
BSI AXP--SM-- Variable Portfolio - Bond Objective: high level of current income IDS Life, investment manager; AEFC
Fund while conserving the value of the investment advisor.
investment for the longest time period.
Invests primarily in investment-grade
bonds.
BCR AXP--SM-- Variable Portfolio - Objective: capital appreciation. Invests IDS Life, investment manager; AEFC
Capital Resource Fund primarily in U.S. common stocks. investment advisor.
BMG AXP--SM-- Variable Portfolio - Objective: maximum total investment IDS Life, investment manager; AEFC
Managed Fund return through a combination of capital investment advisor.
growth and current income. Invests
primarily in stocks, convertible
securities, bonds and money market
instruments.
BAP Appreciation Portfolio Objective: long-term appreciation of SSBCiti Fund Management LLC(SSBCiti)
capital. The fund invests primarily in
equity securities of U.S. companies. The
fund typically invests in medium and
large capitalization companies but may
also invest in small capitalization
companies. Equity securities include
exchange traded and over-the-counter
common stocks and preferred stocks, debt
securities convertible into equity
securities, and warrants and rights
relating to equity securities.
BDS Diversified Strategic Income Objective: high current income. The fund SSBCiti, investment advisor; Smith
Portfolio invests primarily in three types of Barney Global Capital Management, Inc.
fixed income securities: U.S. government sub- investment advisor.
and mortgage-related securities, foreign
government securities, corporate debt
securities and non-convertible preferred
stocks rated below investment grade.
BEG Emerging Growth Portfolio Objective: capital appreciation. The SSBCiti (Appointed interim adviser
fund invests primarily in common stocks pending shareholder approval)
of emerging growth companies, without
regard to market capitalization. These
are domestic or foreign companies the
manager believes are in the early stages
of their life cycles and have the
potential to become major enterprises.
The fund may invest up to 20% of its
assets in securities of foreign issuers.
BEM Equity Income Portfolio Objective: current income. Long-term SSBCiti
capital appreciation is a secondary
goal. The fund invests primarily in
dividend-paying common stocks and other
equity securities of U.S. companies.
Companies with dividend-paying stocks
tend to have large market
capitalizations, but the fund also may
invest in medium and small
capitalization stocks. Equity securities
include preferred stocks and securities
convertible into common stocks.
BEX Equity Index Portfolio -- Class I Objective: provide investment results Travelers Investment Management Company
that, before expenses, correspond to the
price and yield performance of the
S&P 500 Index. The fund will hold
substantially all of the stocks in the
S&P 500 Index, with comparable economic
sector weightings, market capitalization
and liquidity.
BGI Growth & Income Portfolio Objective: income and long-term capital SSBCiti
growth. The fund invests primarily in
equity securities, including convertible
securities, that provide dividend or
interest income. However, it may also
invest in non-income producing stocks
for potential appreciation in value. The
fund emphasizes U.S. stocks with large
capitalizations. The fund may purchase
below investment grade convertible
securities (commonly known as
"junkbonds").
</TABLE>
- --------------------------------------------------------------------------------
12 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
<TABLE>
<CAPTION>
SUBACCOUNT INVESTING IN INVESTMENT OBJECTIVES AND POLICIES INVESTMENT ADVISOR OR MANAGER
<C> <S> <C> <C>
BIH Intermediate High Grade Portfolio Objective: provide as high a level of SSBCiti
current income as is consistent with the
protection of capital. The fund invests
primarily in U.S. government securities
and high-grade corporate bonds of U.S.
issuers. The fund may also invest up to
35% of its assets in other fixed income
securities.
BIE International Equity Portfolio Objective: provide a total return on SSBCiti
assets from growth of capital and
income. The fund invests primarily in
equity securities of foreign companies.
Equity securities include exchange
traded and over-the-counter common
stocks and preferred shares, debt
securities convertible into equity
securities, and warrants and rights
relating to equity securities.
BMO Money Market Portfolio Objective: maximum current income to the SSBCiti
extent consistent with the preservation
of capital and the maintenance of
liquidity. The fund invests in
short-term money market securites,
including U.S. government securities,
repurchase agreements, U.S. and
foreign-bank-time deposits, certificates
of deposit and bankers' acceptances and
high-quality commercial paper and
short-term corporate debt obligations of
U.S. and foreign issuers, including
variable-rate and floating-rate
securities. The fund invests only in
securities purchased with and payable in
U.S. dollars.
BTR Total Return Portfolio Objective: total return, consisting of SSBCiti
long-term capital appreciation and
income. The fund invests primarily in
dividend-paying common stocks of U.S.
and foreign companies. These companies
tend to have large market
capitalizations, but the fund also may
invest in medium and small
capitalization stocks.
</TABLE>
The investment objectives and policies of some of the funds are similar to the
investment objectives and policies of other mutual funds that an 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 and those
results may differ significantly from other funds with similar investment
objectives and policies.
The investment managers and advisors cannot guarantee that the funds will meet
their investment objectives. Please read the fund prospectuses for facts you
should know before investing. These prospectuses are also available by
contacting us at the address or telephone number on the first page of this
prospectus.
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 tax-deferred retirement plans. It is
possible that in the future, it may be disadvantageous for variable annuity
accounts and variable life insurance accounts and/or tax-deferred retirement
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 tax-deferred retirement 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 tax-deferred retirement 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 tax-deferred retirement plan
accounts.
The Internal Revenue Service (IRS) issued final regulations relating to the
diversification requirements under Section 817(h) of the Code. Each fund intends
to comply with these requirements.
The variable account was established under New York law on Oct. 8, 1991. On Oct.
14, 1993, the name of the variable account 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.
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 13
<PAGE>
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 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 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.
We credit and compound interest daily. We will change the interest rates from
time to time at our discretion. These rates will be based on various factors,
including, but not limited to, the interest rate environment, returns earned on
investments backing these annuities, the rates currently in effect for new and
existing company annuities, product design, competition, and the company's
revenues and expenses.
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
You can fill out an 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 certificate. 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.
- --------------------------------------------------------------------------------
14 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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 ten years after issue,
whichever is later.
FOR QUALIFIED ANNUITIES, to avoid IRS penalty taxes, retirement payments
generally must be:
- - on or after the date the annuitant reaches age 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.
However, in no case can the retirement date be later than the annuitant's 85th
birthday or ten years after issue, whichever is later.
BENEFICIARY
If death benefits become payable before the retirement date while the
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 PAYMENTS
MINIMUM ALLOWABLE PURCHASE PAYMENTS
Initial payment: Additional payments:
$5,000 for nonqualified annuities
$500 for nonqualified annuities
$500 for qualified annuities $50 for qualified annuities
MAXIMUM ALLOWABLE PURCHASE PAYMENTS*:
For the first year: $1,000,000
For each subsequent year: $1,000,000
*We reserve the right to change maximum limits. For qualified annuities the
tax-deferred retirement 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 NEW YORK
BOX 5144
ALBANY, NY 12205
EXPRESS MAIL:
IDS LIFE INSURANCE COMPANY OF NEW YORK
20 MADISON AVENUE EXTENSION
ALBANY, NY 12203
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 15
<PAGE>
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 apply this charge daily to the subaccounts. It is reflected in the unit
values of your subaccounts 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. We
could profit from the expense risk fee if future expenses are less than
expected.
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.
- --------------------------------------------------------------------------------
16 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
SURRENDER CHARGE
If you surrender part or all of your certificate, you may be subject to a
surrender charge. A surrender charge applies if you surrender all or part of the
certificate value 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.
<TABLE>
<CAPTION>
YEARS FROM PURCHASE SURRENDER CHARGE
PAYMENT RECEIPT PERCENTAGE
<S> <C>
1 6%
2 5
3 4
4 3
5 2
6 1
Thereafter 0
</TABLE>
After the first certificate year, you may surrender up to 10% of your prior
anniversary certificate 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" (FIFO) basis.
SURRENDER CHARGE ON PARTIAL SURRENDER -- For a partial withdrawal that is
subject to a surrender charge, the amount deducted for the surrender charge will
be a percentage of the total amount withdrawn. We will deduct the charge from
the value remaining after we pay you the amount you requested.
SURRENDER CHARGE CALCULATION EXAMPLE:
ASSUMPTIONS:
<TABLE>
<S> <C>
Initial purchase payment at contract issue date of May 1, 2000 $10,000
Subsequent purchase payment on July 1, 2003 20,000
Account value on certificate anniversary on April 29, 2004 40,000
Account value on October 12, 2004 42,000
</TABLE>
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 17
<PAGE>
FULL SURRENDER ON OCTOBER 12, 2004:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
BASIS OF RATE OF DOLLAR AMOUNT
CHARGE SURRENDER CHARGE OF CHARGE EXPLANATION OF CHARGE
<S> <C> <C> <C>
None $0 10% of prior certificate
anniversary certificate value
surrendered free
$4,000
$8,000 None 0 No charge on certificate earnings
$10,000 2% 200 Payment made in certificate
year 1; surrendered at payment
year 5 rate
$20,000 5% 1,000 Payment made in certificate
year 4; surrendered at payment
year 2 rate
Total Surrender Charge: $1,200
</TABLE>
PARTIAL SURRENDER OF $25,000 ON OCTOBER 12, 2004:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
BASIS OF RATE OF DOLLAR AMOUNT
CHARGE SURRENDER CHARGE OF CHARGE EXPLANATION OF CHARGE
<S> <C> <C> <C>
$4,000 None $0 10% of prior certificate
anniversary certificate value
surrendered free
$8,000 None 0 No charge on certificate earnings
$10,000 2% 200 Payment made in certificate
year 1; surrendered at payment
year 5 rate
$3,000 5% 150 Payment made in certificate
year 4; surrendered at payment
year 2 rate
Total Surrender Charge: $350
</TABLE>
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.
VALUING YOUR INVESTMENT
We value your accounts 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.
- --------------------------------------------------------------------------------
18 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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 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.
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.
FACTORS THAT AFFECT SUBACCOUNT ACCUMULATION UNITS: accumulation units may change
in two ways - in number and in value.
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.
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 19
<PAGE>
MAKING THE MOST OF YOUR CERTIFICATE
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
EXPRESS MAIL:
IDS LIFE INSURANCE COMPANY OF NEW YORK
20 MADISON AVENUE EXTENSION
ALBANY, NY 12203
MINIMUM AMOUNT
Transfers: $500 or entire account balance
Surrenders: $500 (If a partial surrender would reduce the
account balance to less than $500, you either
cannot make the surrender or you must
surrender the full account value.)
MAXIMUM AMOUNT
Transfers or surrenders: Certificate value
- --------------------------------------------------------------------------------
20 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
2 BY AUTOMATED TRANSFERS AND AUTOMATED PARTIAL SURRENDERS
- --------------------------------------------------------------------------------
Your sales representative 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.
MINIMUM AMOUNT
Transfers: $100
Surrenders: $500 (If a partial surrender would reduce the
account balance to less than $500, you either cannot make
the surrender or you must surrender the full account value.)
3 BY PHONE
- --------------------------------------------------------------------------------
Call between 8 a.m. and 4:30 p.m. Eastern time:
1-800-724-0705
MINIMUM AMOUNT
Transfers: $500 or entire account balance
Surrenders: $500 (If a partial surrender would reduce the account
balance to less than $500, you either cannot make the
surrender or you must surrender the full account
value.)
MAXIMUM AMOUNT
Transfers: Certificate value
Surrenders: $40,000
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.
- --------------------------------------------------------------------------------
PROSPECTUS -- MAY 1, 2000 21
<PAGE>
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.
Minimum certificate value $5,000
Minimum systematic withdrawal amount $100
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. For total
surrenders, we will compute the value of your certificate at the next
accumulation unit value calculated after we receive your request. We may ask you
to return the certificate. You may have to pay 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.
NOTE: We will charge you a fee if you request express mail delivery.
Normally, we will send the payment 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.
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22 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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 values 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. However, if the owner is a trust or custodian, or an
employer acting in a similar capacity, ownership of a contract may be
transferred to the annuitant.
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PROSPECTUS -- MAY 1, 2000 23
<PAGE>
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
- - 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 certificate as owner until the date on which the annuitant would have
reached age 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 certificate
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 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.")
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24 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
THE ANNUITY PAYOUT PERIOD
As owner of the certificate, you have the right to decide how and to whom
annuity payouts will be made starting at the retirement date. You may select one
of the annuity payout plans outlined below, or we may mutually agree on other
payout arrangements.
The amount available to purchase payouts under the plan you select is the
certificate value on your retirement date. We will make annuity payouts on a
fixed basis. We do not deduct any surrender charges under the payout plans
listed below.
RETIREMENT PAYMENT PLANS
You may choose any one of these annuity payout plans by giving us written
instructions at least 30 days before certificate values are used to purchase the
payout plan:
PLAN A -- LIFE ANNUITY -- NO REFUND: We make monthly payouts until the
annuitant's death. Payouts end with the last payout before the annuitant's
death. We will not make any further payouts. This means that if the annuitant
dies after we have made only one monthly payout, we will not make any more
payouts.
PLAN B -- LIFE ANNUITY WITH FIVE, TEN OR 15 YEARS CERTAIN: We make monthly
payouts for a guaranteed payout period of five, ten or 15 years that you elect.
This election will determine the length of the payout period to the beneficiary
if the annuitant should die before the elected period expires. We calculate the
guaranteed payout period from the retirement date. If the annuitant outlives the
elected guaranteed payout period, we will continue to make payouts until the
annuitant's death.
PLAN C -- LIFE ANNUITY -- INSTALLMENT REFUND: We make monthly payouts until the
annuitant's death, with our guarantee that payouts will continue for some period
of time. We will make payouts for at least the number of months determined by
dividing the amount applied under this option by the first monthly payout,
whether or not the annuitant is living.
PLAN D -- JOINT AND LAST SURVIVOR LIFE ANNUITY -- NO REFUND: We make monthly
payouts while both the annuitant and a joint annuitant are living. If either
annuitant dies, we will continue to make monthly payouts at the full amount
until the death of the surviving annuitant. Payouts end with the death of the
second annuitant.
PLAN E -- PAYOUTS FOR A SPECIFIED PERIOD: We make monthly payouts for a specific
payout period of ten to 30 years that you elect. We will make payouts only for
the number of years specified whether the annuitant is living or not. Depending
on the selected time period, it is foreseeable that an annuitant can outlive the
payout period selected. In addition, a 10% IRS penalty tax could apply under
this payout plan. (See "Taxes.")
RESTRICTIONS FOR SOME TAX-DEFERRED RETIREMENT 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.
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PROSPECTUS -- MAY 1, 2000 25
<PAGE>
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.
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, your certificate has a tax-deferral feature. This
means any increase in the value of the fixed account and/or variable accounts in
which you invest 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.
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 annuities 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.
QUALIFIED ANNUITIES: Your certificate may be used to fund a tax-deferred
retirement plan that is already tax-deferred under the Code. The certificate
will not provide any necessary or additional tax-deferral if it is used to fund
a retirement plan that is tax-deferred. 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.
Adverse tax consequences may result if you do not ensure that contributions,
distributions and other transactions under the certificate 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 your retirement plan or adoption agreement or consult a tax advisor for more
information about your distribution rules.
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.
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26 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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);
- - 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.
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 possibly state income
tax withholding) generally will be imposed at the time we make payout. 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.
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PROSPECTUS -- MAY 1, 2000 27
<PAGE>
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.
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
amendments.
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 received instructions. We also will vote
the shares for which we have voting rights in the same proportion as the votes
for which we received instructions.
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28 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
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. American Express
Company is a financial services company headquartered in New York City
principally engaged through subsidiaries (in addition to AEFC) in travel related
services, investment services and international banking services.
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% of the total purchase
payments it receives on the certificates.
LEGAL PROCEEDINGS
A number of lawsuits have been filed against life and health insurers in
jurisdictions in which IDS Life of New York and its affiliates do business
involving insurers' sales practices, alleged agent misconduct, failure to
properly supervise agents, and other matters. IDS Life is a defendant in three
class action lawsuits of this nature. IDS Life of New York is a named defendant
in one of these suits.
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 which was commenced in Minnesota
State Court in October 1998. The action was brought by individuals who purchased
an annuity in a qualified plan. The plaintiffs 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.
IDS Life of New York is included as a party to preliminary settlement of all
three class action lawsuits. We believe this approach will put these cases
behind us and provide a fair outcome for our clients. Our decision to settle
does not include any admission of wrongdoing. We do not anticipate that this
proposed settlement, or any other lawsuits in which IDS Life of New York is a
defendant, will have a material adverse effect on our financial condition.
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PROSPECTUS -- MAY 1, 2000 29
<PAGE>
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. All of the major systems used by IDS Life of New York and
the variable account are maintained by AEFC and are utilized by multiple
subsidiaries and affiliates of AEFC. IDS Life of New York's and the variable
account's businesses are heavily dependent upon AEFC's computer systems and have
significant interaction with systems of third parties.
A comprehensive review of AEFC's computer systems and business processes,
including those specific to IDS Life of New York and the variable account, was
conducted to identify the major systems that could be affected by the Year 2000
issue. Steps were taken to resolve potential problems including modification to
existing software and the purchase of new software. As of Dec. 31, 1999, AEFC
had completed its program of corrective measures on its internal systems and
applications, including Year 2000 compliance testing. As of Dec. 31, 1999, AEFC
had also completed an evaluation of 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.
AEFC's Year 2000 project also included 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. As of Dec. 31, 1999, these plans had been amended to include
specific Year 2000 considerations.
In assessing its Year 2000 initiatives and the results of actual production
since Jan. 1, 2000, management believes no material adverse consequences were
experienced, and there was no material effect on IDS Life of New York's and the
variable account's business, results of operations, or financial condition as a
result of the Year 2000 issue.
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30 SYMPHONY ANNUITY -- NEW YORK
<PAGE>
TABLE OF CONTENTS OF THE STATEMENT OF
ADDITIONAL INFORMATION
Performance Information.......... ........... 3
Calculating Annuity Payouts.................. 5
Rating Agencies.............................. 5
Principal Underwriter........................ 6
Independent Auditors......................... 6
Financial Statements
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PROSPECTUS -- MAY 1, 2000 31
<PAGE>
Please check the appropriate box to receive a copy of the Statement of
Additional Information for:
/ / Symphony Annuity
/ / American Express Variable Portfolio Funds
/ / Greenwich Street Series Fund
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:
Your name _____________________________________________________________________
Address _______________________________________________________________________
City _________________________ State ___________ Zip ________________________
<PAGE>
Symphony
- -------------------------------
IDS Life Insurance Company
Of New York
P.O. Box 5144
Albany, NY 12205
IN0800 S-6226 L (5/00)
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
for
SYMPHONY ANNUITY
IDS LIFE OF NEW YORK ACCOUNT SBS
May 1, 2000
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 Insurance Company of New York
20 Madison Avenue Extension
Albany, NY 12203
800-724-0705
<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 ten 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 cumulative 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)
Total return figures reflect the deduction of the surrender charge which assumes
you surrender the entire certificate value at the end of the one, five and ten
year periods (or, if less, up to the life of the subaccount). We also may show
performance figures without the deduction of a surrender charge. In addition,
total return figures reflect the deduction of all other 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
Annualized 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 Business 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 & 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; the
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 (Excellent)
A.M. Best's superior rating reflects our strong distribution network, favorable
overall balance sheet, consistently improving profitability, adequate level of
capitalization and asset/liability management expertise.
Duff & Phelps rating reflects our consistently excellent profitability record,
leadership position in chosen markets, stable operating leverage and effective
use of asset/liability management techniques.
<PAGE>
Moody's excellent rating reflects our leadership position in financial planning,
strong asset, liability management and good capitalization. IDS Life has a
strong market focus and greatly emphasizes quality service. This information
applies only to fixed products invested in IDS Life's General Account and
reflects IDS Life's ability to fulfill its obligations under its contracts. This
information does not relate to the management and performance of the separate
account assets associated with IDS Life's variable products.
PRINCIPAL UNDERWRITER
The principal underwriter for the certificate is Salomon Smith Barney Inc.,
which offers the contract on a continuous basis.
Surrender charges received by Salomon Smith Barney Inc. for the last three years
aggregated total 993,347, 886,431, and 688,455, respectively.
Commissions paid by Salomon Smith Barney Inc. for the last three years
aggregated total 957,659, 1,115,312, and 1,067,783, 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 BSI, BCR, BAP, BDS, BEG, BEM, BEX, BGI, BIH, BIE, BMO
and BTR,) as of December 31, 1999, 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 auditing standards generally accepted
in the United States. 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, 1999 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 (as described
above) at December 31, 1999 and the individual and combined results of their
operations and the changes in their net assets for the periods described above,
in conformity with accounting principles generally accepted in the United
States.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Minneapolis, Minnesota
March 17, 2000
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Net Assets
December 31, 1999
Segregated Asset Subaccounts
Assets BSI BCR BAP
Investments in shares of mutual funds and portfolios:
<S> <C> <C> <C>
at cost $ 15,875 $ 22,012 $ 2,446,237
-------- -------- -----------
at market value $ 14,106 $ 28,592 $ 4,189,978
Dividends receivable 87 -- --
Accounts receivable from IDS Life of New York for
certificate purchase payments -- -- 6,618
Receivable from mutual funds and portfolios for share redemptions -- -- 5,351
----- ----- -----
Total assets 14,193 28,592 4,201,947
====== ====== =========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 15 30 4,491
Administrative charge 3 6 898
Certificate terminations -- -- --
Payable to mutual funds and portfolios for investments purchased -- -- 6,618
----- ----- -----
Total liabilities 18 36 12,007
-- -- ------
Net assets applicable to contracts in accumulation period $ 14,175 $ 28,556 $ 4,189,940
======== ======== ===========
Accumulation units outstanding 12,680 13,063 1,705,979
====== ====== =========
Net asset value per accumulation unit $ 1.12 $ 2.19 $ 2.45
====== ====== ======
Assets BDS BEG BEM
Investments in shares of mutual funds and portfolios:
at cost $ 1,259,013 $ 905,574 $ 845,084
----------- --------- ---------
at market value $ 1,302,182 $ 2,125,209 $ 834,591
Dividends receivable -- -- --
Accounts receivable from IDS Life of New York for
certificate purchase payments -- -- --
Receivable from mutual funds and portfolios for share redemptions 2,386 2,779 1,204
----- ----- -----
Total assets 1,304,568 2,127,988 835,795
========= ========= =======
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 1,400 2,274 969
Administrative charge 280 455 194
Certificate terminations 706 50 41
Payable to mutual funds and portfolios for investments purchased -- -- --
----- --- ------
Total liabilities 2,386 2,779 1,204
----- ----- -----
Net assets applicable to contracts in accumulation period $ 1,302,182 $ 2,125,209 $ 834,591
=========== =========== =========
Accumulation units outstanding 912,546 417,096 514,226
======= ======= =======
Net asset value per accumulation unit $ 1.43 $ 5.10 $ 1.62
====== ====== ======
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Net Assets
December 31, 1999
Segregated Asset Subaccounts
Assets BEX BGI BIH BIE
Investments in shares of mutual funds and portfolios:
<S> <C> <C> <C> <C>
at cost $ 426,107 $ 1,539,465 $ 1,722,640 $ 683,819
--------- ----------- ----------- ---------
at market value $ 1,075,391 $ 1,876,782 $ 1,618,146 $ 1,348,394
Dividends receivable -- -- -- --
Accounts receivable from IDS Life of New York
for certificate purchase payments -- 9 -- 698
Receivable from mutual funds and portfolios
for share redemptions 1,735 2,625 2,280 1,887
----- ----- ----- -----
Total assets 1,077,126 1,879,416 1,620,426 1,350,979
========= ========= ========= =========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 1,300 2,187 1,733 1,573
Administrative charge 260 438 346 314
Certificate terminations 175 -- 201 --
Payable to mutual funds and portfolios
for investments purchased -- 9 -- 698
- ---
Total liabilities 1,735 2,634 2,280 2,585
----- ----- ----- -----
Net assets applicable to contracts in accumulation period $ 1,075,391 $ 1,876,782 $ 1,618,146 $ 1,348,394
=========== =========== =========== ===========
Accumulation units outstanding 333,886 847,557 1,323,638 628,560
======= ======= ========= =======
Net asset value per accumulation unit $ 3.22 $ 2.21 $ 1.22 $ 2.15
====== ====== ====== ======
Combined
Variable
Assets BMO BTR Account
Investments in shares of mutual funds and portfolios:
at cost $ 444,912 $ 1,535,375 $ 11,846,113
--------- ----------- ------------
at market value $ 444,912 $ 2,298,850 $ 17,157,133
Dividends receivable 1,279 -- 1,366
Accounts receivable from IDS Life of New York
for certificate purchase payments -- -- 7,325
Receivable from mutual funds and portfolios
for share redemptions 43,366 3,895 67,508
------ ----- ------
Total assets 489,557 2,302,745 17,233,332
======= ========= ==========
Liabilities
Payable to IDS Life of New York for:
Mortality and expense risk fee 493 2,632 19,097
Administrative charge 99 526 3,819
Certificate terminations 42,774 738 44,685
Payable to mutual funds and portfolios
for investments purchased 1,279 -- 8,604
----- -----
Total liabilities 44,645 3,896 76,205
------ ----- ------
Net assets applicable to contracts in accumulation period $ 444,912 $ 2,298,849 $ 17,157,127
========= =========== ============
Accumulation units outstanding 372,896 970,516
======= =======
Net asset value per accumulation unit $ 1.19 $ 2.37
====== ======
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Operations
Year ended December 31, 1999
Segregated Asset Subaccounts
Investment income BSI BCR BAP
<S> <C> <C> <C>
Dividend income from mutual funds and portfolios $ 1,067 $ 2,584 $ 132,701
------- ------- ---------
Expenses:
Mortality and expense risk fee 207 323 66,116
Administrative charge 42 70 13,223
-- -- ------
Total expenses 249 393 79,339
--- --- ------
Investment income (loss) - net 818 2,191 53,362
=== ===== ======
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of investments in
mutual funds and portfolios:
Proceeds from sales 2,957 2,248 2,269,125
Cost of investments sold 3,295 1,766 1,382,668
----- ----- ---------
Net realized gain (loss) on investments (338) 482 886,457
Net change in unrealized appreciation or
depreciation of investments (506) 2,577 (372,513)
---- ----- --------
Net gain (loss) on investments (844) 3,059 513,944
---- ----- -------
Net increase (decrease) in net assets resulting from operations $ (26) $ 5,250 $ 567,306
===== ======= =========
Investment income BDS BEG BEM
Dividend income from mutual funds and portfolios $ 112,326 $ 245,373 $ 352,435
--------- --------- ---------
Expenses:
Mortality and expense risk fee 22,258 18,305 17,243
Administrative charge 4,452 3,661 3,449
----- ----- -----
Total expenses 26,710 21,966 20,692
------ ------ ------
Investment income (loss) - net 85,616 223,407 331,743
====== ======= =======
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of investments in
mutual funds and portfolios:
Proceeds from sales 878,568 244,612 753,423
Cost of investments sold 846,544 154,029 702,420
------- ------- -------
Net realized gain (loss) on investments 32,024 90,583 51,003
Net change in unrealized appreciation or
depreciation of investments (117,821) 818,471 (452,920)
-------- ------- --------
Net gain (loss) on investments (85,797) 909,054 (401,917)
------- ------- --------
Net increase (decrease) in net assets resulting from operations $ (181) $ 1,132,461 $ (70,174)
====== =========== =========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life of New York Account SBS
Statements of Operations
Year ended December 31, 1999
Segregated Asset Subaccounts
Investment income BEX BGI BIH BIE
<S> <C> <C> <C> <C>
Dividend income from mutual funds and portfolios $ 29,843 $ 624,075 $ 140,065 $ 131,037
-------- --------- --------- ---------
Expenses:
Mortality and expense risk fee 31,385 35,304 22,794 15,718
Administrative charge 6,277 7,061 4,559 3,144
----- ----- ----- -----
Total expenses 37,662 42,365 27,353 18,862
------ ------ ------ ------
Investment income (loss) - net (7,819) 581,710 112,712 112,175
====== ======= ======= =======
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales 2,538,519 1,572,281 278,142 461,577
Cost of investments sold 1,084,898 1,318,638 283,089 293,101
--------- --------- ------- -------
Net realized gain (loss) on investments 1,453,621 253,643 (4,947) 168,476
Net change in unrealized appreciation or
depreciation of investments (1,078,251) (608,116) (203,072) 346,164
---------- -------- -------- -------
Net gain (loss) on investments 375,370 (354,473) (208,019) 514,640
------- -------- -------- -------
Net increase (decrease) in net assets
resulting from operations $ 367,551 $ 227,237 $ (95,307) $ 626,815
========= ========= ========= =========
Combined
Variable
Investment income BMO BTR Account
Dividend income from mutual funds and portfolios $ 22,302 $ 154,635 $ 1,948,443
-------- --------- -----------
Expenses:
Mortality and expense risk fee 7,192 31,029 267,874
Administrative charge 1,438 6,205 53,581
----- ----- ------
Total expenses 8,630 37,234 321,455
----- ------ -------
Investment income (loss) - net 13,672 117,401 1,626,988
====== ======= =========
Realized and unrealized gain (loss)
on investments - net
Realized gain (loss) on sales of investments
in mutual funds and portfolios:
Proceeds from sales 1,438,773 574,993 11,015,218
Cost of investments sold 1,438,772 403,882 7,913,102
--------- ------- ---------
Net realized gain (loss) on investments 1 171,111 3,102,116
Net change in unrealized appreciation or
depreciation of investments (1) 156,583 (1,509,405)
-- ------- ----------
Net gain (loss) on investments -- 327,694 1,592,711
------- ---------
Net increase (decrease) in net assets
resulting from operations $ 13,672 $ 445,095 $ 3,219,699
======== ========= ===========
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 December 31, 1999
Segregated Asset Subaccounts
Operations BSI BCR BAP
<S> <C> <C> <C>
Investment income (loss) - net $ 818 $ 2,191 $ 53,362
Net realized gain (loss) on investments (338) 482 886,457
Net change in unrealized appreciation or
depreciation of investments (506) 2,577 (372,513)
---- ----- --------
Net increase (decrease) in net assets
resulting from operations (26) 5,250 567,306
=== ===== =======
Certificate transactions
Certificate purchase payments -- -- 300
Net transfers* (5) (1) (195,477)
Certificate terminations:
Surrender benefits and certificate charges (2,882) (1,908) (1,973,158)
Death benefits -- -- (20,519)
----- ----- -------
Increase (decrease) from certificate transactions (2,887) (1,909) (2,188,854)
------ ------ ----------
Net assets at beginning of year 17,088 25,215 5,811,488
------ ------ ---------
Net assets at end of year $ 14,175 $ 28,556 $ 4,189,940
======== ======== ===========
Accumulation unit activity
Units outstanding at beginning of year 15,296 14,059 2,640,863
Certificate purchase payments -- -- 128
Net transfers* -- -- (83,127)
Certificate terminations:
Surrender benefits and certificate charges (2,616) (996) (843,021)
Death benefits -- -- (8,864)
------ ----- ------
Units outstanding at end of year 12,680 13,063 1,705,979
====== ====== =========
Operations BDS BEG BEM
Investment income (loss) - net $ 85,616 $ 223,407 $ 331,743
Net realized gain (loss) on investments 32,024 90,583 51,003
Net change in unrealized appreciation or
depreciation of investments (117,821) 818,471 (452,920)
-------- ------- --------
Net increase (decrease) in net assets
resulting from operations (181) 1,132,461 (70,174)
==== ========= =======
Certificate transactions
Certificate purchase payments -- 1,012 300
Net transfers* (470,774) (25) (208,310)
Certificate terminations:
Surrender benefits and certificate charges (372,781) (220,963) (521,672)
Death benefits -- -- --
----- ------ ------
Increase (decrease) from certificate transactions (843,555) (219,976) (729,682)
-------- -------- --------
Net assets at beginning of year 2,145,918 1,212,724 1,634,447
--------- --------- ---------
Net assets at end of year $ 1,302,182 $ 2,125,209 $ 834,591
=========== =========== =========
Accumulation unit activity
Units outstanding at beginning of year 1,506,706 485,683 944,888
Certificate purchase payments -- 350 177
Net transfers* (332,123) -- (118,147)
Certificate terminations:
Surrender benefits and certificate charges (262,037) (68,937) (312,692)
Death benefits -- -- --
------ ------ ----
Units outstanding at end of year 912,546 417,096 514,226
======= ======= =======
*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 December 31, 1999
Segregated Asset Subaccounts
Operations BEX BGI BIH BIE
<S> <C> <C> <C> <C>
Investment income (loss) - net $ (7,819) $ 581,710 $ 112,712 $ 112,175
Net realized gain (loss) on investments 1,453,621 253,643 (4,947) 168,476
Net change in unrealized appreciation or
depreciation of investments (1,078,251) (608,116) (203,072) 346,164
---------- -------- -------- -------
Net increase (decrease) in net assets
resulting from operations 367,551 227,237 (95,307) 626,815
======= ======= ======= =======
Certificate transactions
Certificate purchase payments 300 299 300 --
Net transfers* (196,503) (195,138) 85,656 (22,354)
Certificate terminations:
Surrender benefits and certificate charges (2,184,128) (1,293,085) (347,309) (418,715)
Death benefits -- (18,260) -- --
-------
Increase (decrease) from certificate transactions (2,380,331) (1,506,184) (261,353) (441,069)
---------- ---------- -------- --------
Net assets at beginning of year 3,088,171 3,155,729 1,974,806 1,162,648
--------- --------- --------- ---------
Net assets at end of year $ 1,075,391 $ 1,876,782 $ 1,618,146 $ 1,348,394
=========== =========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 1,141,269 1,553,578 1,532,565 887,562
Certificate purchase payments 102 141 240 --
Net transfers* (64,741) (90,503) 67,462 (15,676)
Certificate terminations:
Surrender benefits and certificate charges (742,744) (606,848) (276,629) (243,326)
Death benefits -- (8,811) -- --
------
Units outstanding at end of year 333,886 847,557 1,323,638 628,560
======= ======= ========= =======
Combined
Variable
Operations BMO BTR Account
Investment income (loss) - net $ 13,672 $ 117,401 $ 1,626,988
Net realized gain (loss) on investments 1 171,111 3,102,116
Net change in unrealized appreciation or
depreciation of investments (1) 156,583 (1,509,405)
-- ------- ----------
Net increase (decrease) in net assets
resulting from operations 13,672 445,095 3,219,699
====== ======= =========
Certificate transactions
Certificate purchase payments -- -- 2,511
Net transfers* 1,230,735 (7,343) 20,461
Certificate terminations:
Surrender benefits and certificate charges (1,332,968) (515,806) (9,185,375)
Death benefits -- -- (38,779)
-------- ------- -------
Increase (decrease) from certificate transactions (102,233) (523,149) (9,201,182)
-------- -------- ----------
Net assets at beginning of year 533,473 2,376,903 23,138,610
------- --------- ----------
Net assets at end of year $ 444,912 $ 2,298,849 $ 17,157,127
========= =========== ============
Accumulation unit activity
Units outstanding at beginning of year 458,120 1,206,105
Certificate purchase payments -- --
Net transfers* 1,042,575 (3,473)
Certificate terminations:
Surrender benefits and certificate charges (1,127,799) (232,116)
Death benefits -- --
------ ------
Units outstanding at end of year 372,896 970,516
======= =======
*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 December 31, 1998
Segregated Asset Subaccounts
Operations BSI BCR BAP
<S> <C> <C> <C>
Investment income (loss) - net $ 976 $ 1,511 $ 228,010
Net realized gain (loss) on investments -- 212 384,672
Net change in unrealized appreciation or
depreciation of investments (1,050) 2,620 332,093
------ ----- -------
Net increase (decrease) in net assets
resulting from operations (74) 4,343 944,775
=== ===== =======
Certificate transactions
Certificate purchase payments -- -- 790
Net transfers* 2,987 3,801 36,767
Certificate terminations:
Surrender benefits and certificate charges (6) (1,764) (944,728)
Death benefits -- -- (5,069)
----- ----- ------
Increase (decrease) from certificate transactions 2,981 2,037 (912,240)
----- ----- --------
Net assets at beginning of year 14,181 18,835 5,778,953
------ ------ ---------
Net assets at end of year $ 17,088 $ 25,215 $ 5,811,488
======== ======== ===========
Accumulation unit activity
Units outstanding at beginning of year 12,690 12,843 3,081,905
Certificate purchase payments -- -- 376
Net transfers* 2,611 2,368 16,941
Certificate terminations:
Surrender benefits and certificate charges (5) (1,152) (455,931)
Death benefits -- -- (2,428)
----- ----- ------
Units outstanding at end of year 15,296 14,059 2,640,863
====== ====== =========
Operations BDS BEG BEM
Investment income (loss) - net $ 106,454 $ 159,674 $ 113,933
Net realized gain (loss) on investments 38,374 68,107 83,968
Net change in unrealized appreciation or
depreciation of investments (33,283) 101,896 32,668
------- ------- ------
Net increase (decrease) in net assets
resulting from operations 111,545 329,677 230,569
======= ======= =======
Certificate transactions
Certificate purchase payments 250 1,511 40
Net transfers* (11,879) (1,881) (96,995)
Certificate terminations:
Surrender benefits and certificate charges (452,258) (192,040) (172,806)
Death benefits (3,360) -- --
------ ------ ------
Increase (decrease) from certificate transactions (467,247) (192,410) (269,761)
-------- -------- --------
Net assets at beginning of year 2,501,620 1,075,457 1,673,639
--------- --------- ---------
Net assets at end of year $2,145,918 $ 1,212,724 $ 1,634,447
========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 1,841,311 581,926 1,115,107
Certificate purchase payments 179 688 25
Net transfers* (8,776) (3,519) (61,993)
Certificate terminations:
Surrender benefits and certificate charges (323,573) (93,412) (108,251)
Death benefits (2,435) -- --
------ ------ ------
Units outstanding at end of year 1,506,706 485,683 944,888
========= ======= =======
*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 December 31, 1998
Segregated Asset Subaccounts
Operations BEX BGI BIH BIE
<S> <C> <C> <C> <C>
Investment income (loss) - net $ (12,198) $ 314,362 $ 101,941 $ (14,323)
Net realized gain (loss) on investments 165,922 118,355 9,952 92,594
Net change in unrealized appreciation or
depreciation of investments 525,208 (122,734) (7,465) 118,017
------- -------- ------ -------
Net increase (decrease) in net assets
resulting from operations 678,932 309,983 104,428 196,288
======= ======= ======= =======
Certificate transactions
Certificate purchase payments 2,282 790 40 500
Net transfers* 26,626 (67,853) 28,071 (4,283)
Certificate terminations:
Surrender benefits and certificate charges (283,467) (233,756) (194,250) (402,817)
Death benefits -- -- (25,951) --
------- ------ ------- -------
Increase (decrease) from certificate transactions (254,559) (300,819) (192,090) (406,600)
-------- -------- -------- --------
Net assets at beginning of year 2,663,798 3,146,565 2,062,468 1,372,960
--------- --------- --------- ---------
Net assets at end of year $ 3,088,171 $ 3,155,729 $ 1,974,806 $ 1,162,648
=========== =========== =========== ===========
Accumulation unit activity
Units outstanding at beginning of year 1,246,827 1,708,537 1,683,871 1,226,952
Certificate purchase payments 938 388 32 377
Net transfers* 10,707 (37,294) 22,482 (10,511)
Certificate terminations:
Surrender benefits and certificate charges (117,203) (118,053) (153,193) (329,256)
Death benefits -- -- (20,627) --
-------- --------- ------- ------
Units outstanding at end of year 1,141,269 1,553,578 1,532,565 887,562
========= ========= ========= =======
Combined
Variable
Operations BMO BTR Account
Investment income (loss) - net $ 15,693 $ 100,784 $ 1,114,330
Net realized gain (loss) on investments 1 145,077 1,107,022
Net change in unrealized appreciation or
depreciation of investments (2) (158,222) 788,176
-- -------- -------
Net increase (decrease) in net assets
resulting from operations 15,692 87,639 3,009,528
====== ====== =========
Certificate transactions
Certificate purchase payments -- -- 6,203
Net transfers* 204,505 70,437 183,515
Certificate terminations:
Surrender benefits and certificate charges (207,850) (477,886) (3,561,858)
Death benefits -- (28,747) (63,127)
------- ------- -------
Increase (decrease) from certificate transactions (3,345) (436,196) (3,435,267)
------ -------- ----------
Net assets at beginning of year 521,126 2,725,460 23,522,046
------- --------- ----------
Net assets at end of year $ 533,473 $ 2,376,903 $ 23,096,307
========= =========== ============
Accumulation unit activity
Units outstanding at beginning of year 460,369 1,430,157
Certificate purchase payments -- --
Net transfers* 176,937 34,773
Certificate terminations:
Surrender benefits and certificate charges (179,186) (244,517)
Death benefits -- (14,308)
------- -------
Units outstanding at end of year 458,120 1,206,105
======= =========
*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.
Subaccount Invests exclusively in shares of Investment Manager
<S> <C> <C>
BSI AXPSM Variable Portfolio-- Bond Fund IDS Life Insurance Company 1
BCR AXPSM Variable Portfolio-- Capital Resource Fund IDS Life Insurance Company 1
BAP Appreciation Portfolio Salomon Smith Barney Inc.2
BDS Diversified Strategic Income Portfolio Salomon Smith Barney Inc.3
BEG Emerging Growth Portfolio Salomon Smith Barney Inc.4
BEM Equity Income Portfolio Salomon Smith Barney Inc.2
BEX Equity Index Portfolio Salomon Smith Barney Inc.5
BGI Growth & Income Portfolio Salomon Smith Barney Inc.2
BIH Intermediate High Grade Portfolio Salomon Smith Barney Inc.2
BIE International Equity Portfolio Salomon Smith Barney Inc.2
BMO Money Market Portfolio Salomon Smith Barney Inc.2
BTR Total Return Portfolio Salomon Smith Barney Inc.2
1 American Express Financial Corporation (AEFC) is the investment advisor.
2 SSBCiti Fund Management LLC (SSBCiti) is the investment advisor.
3 SSBCiti is the investment advisor. Smith Barney Global Capital Management,
Inc. is the sub-investment advisor.
4 SSBCiti (Appointed interim advisor pending shareholder approval)
5 Travelers Investment Management Company 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 accounting principles
generally accepted in the United States 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 certificate 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 $993,347 in 1999 and $886,431 in 1998. 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, 1999 were as
follows:
Subaccount Investment Shares NAV
<S> <C> <C> <C>
BSI AXPSM Variable Portfolio-- Bond Fund 1,338 $10.54
BCR AXPSM Variable Portfolio-- Capital Resource Fund 786 36.40
BAP Appreciation Portfolio 179,135 23.39
BDS Diversified Strategic Income Portfolio 124,730 10.44
BEG Emerging Growth Portfolio 64,186 33.11
BEM Equity Income Portfolio 69,203 12.06
BEX Equity Index Portfolio 29,989 35.86
BGI Growth & Income Portfolio 113,952 16.47
BIH Intermediate High Grade Portfolio 166,991 9.69
BIE International Equity Portfolio 65,140 20.70
BMO Money Market Portfolio 444,912 1.00
BTR Total Return Portfolio 114,143 20.14
8. INVESTMENT TRANSACTIONS
The subaccounts' purchases of Funds' shares, including reinvestment of dividend
distributions, were as follows:
Year ended Dec. 31,
Subaccount Investment 1999 1998
<S> <C> <C> <C>
BSI AXPSM Variable Portfolio-- Bond Fund $ 819 $ 3,963
BCR AXPSM Variable Portfolio-- Capital Resource Fund 2,566 5,589
BAP Appreciation Portfolio 126,241 444,679
BDS Diversified Strategic Income Portfolio 117,887 154,343
BEG Emerging Growth Portfolio 246,476 227,153
BEM Equity Income Portfolio 353,408 175,928
BEX Equity Index Portfolio 146,447 56,412
BGI Growth & Income Portfolio 643,789 378,249
BIH Intermediate High Grade Portfolio 126,985 162,974
BIE International Equity Portfolio 131,104 28,465
BMO Money Market Portfolio 1,349,500 326,416
BTR Total Return Portfolio 166,128 221,289
Combined Variable Account $3,411,350 $2,185,460
9. YEAR 2000 (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. All of the major systems used by IDS Life of New York and
the Variable Account are maintained by AEFC and are utilized by multiple
subsidiaries and affiliates of AEFC. IDS Life of New York's and the Variable
Account's businesses are heavily dependent upon AEFC's computer systems and have
significant interaction with systems of third parties.
A comprehensive review of AEFC's computer systems and business processes,
including those specific to IDS Life of New York and the Variable Account, was
conducted to identify the major systems that could be affected by the Year 2000
issue. Steps were taken to resolve any potential problems including modification
to existing software and the purchase of new software. As of Dec. 31, 1999, AEFC
had completed its program of corrective measures on its internal systems and
applications, including Year 2000 compliance testing. As of Dec. 31, 1999, AEFC
had also completed an evaluation of 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.
AEFC's Year 2000 project also included 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. As of Dec. 31, 1999, these plans had been amended to include
specific Year 2000 considerations.
In assessing its Year 2000 initiatives and the results of actual production
since Jan. 1, 2000, management believes no material adverse consequences were
experienced, and there was no material effect on IDS Life of New York's and the
Variable Account's business, results of operations, or financial condition as a
result of the Year 2000 issue.
</TABLE>
<PAGE>
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
FINANCIAL INFORMATION
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, 1999 and 1998, and the related statements of income, stockholder's
equity and cash flows for each of the three years in the period ended December
31, 1999. 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 auditing standards generally accepted
in the United States. 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, 1999 and 1998, and the results of its operations and
its cash flows for each of the three years in the period ended December 31,
1999, in conformity with accounting principles generally accepted in the
United States.
ERNST & YOUNG LLP
February 3, 2000
Minneapolis, Minnesota
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IDS LIFE INSURANCE COMPANY OF NEW YORK F-1
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, ($ THOUSANDS) 1999 1998
<S> <C> <C>
ASSETS
- -----------------------------------------------------------------
Investments:
Fixed maturities:
Held to maturity, at amortized cost
(fair value:
1999, $432,004; 1998, $503,909) $ 434,343 $ 473,592
Available for sale, at fair value
(amortized cost:
1999, $579,014; 1998, $561,325) 555,574 578,591
- -----------------------------------------------------------------
989,917 1,052,183
Mortgage loans on real estate 154,062 166,835
Policy loans 27,528 25,421
Other investments -- 566
- -----------------------------------------------------------------
Total investments 1,171,507 1,245,005
Cash and cash equivalents 8,131 3,007
Amounts recoverable from reinsurers 6,914 4,077
Accounts receivable 567 842
Premiums due 199 204
Accrued investment income 18,365 19,893
Deferred policy acquisition costs 136,229 129,477
Deferred income taxes 3,881 --
Other assets 723 1,042
Separate account assets 1,957,703 1,491,679
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Total assets $3,304,219 $2,895,226
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LIABILITIES AND STOCKHOLDER'S EQUITY
- -----------------------------------------------------------------
Liabilities:
Future policy benefits:
Fixed annuities $ 821,992 $ 875,507
Universal life-type insurance 156,420 152,195
Traditional life, disability income and
long-term care insurance 64,278 55,910
Policy claims and other policyholders'
funds 2,584 3,105
Deferred income taxes -- 7,912
Amounts due to brokers -- 4,507
Other liabilities 21,432 24,945
Separate account liabilities 1,957,703 1,491,679
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Total liabilities 3,024,409 2,615,760
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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 (loss)
income:
Net unrealized securities (losses) gains (14,966) 11,014
- -----------------------------------------------------------------
Retained earnings 243,776 217,452
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Total stockholder's equity 279,810 279,466
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Total liabilities and stockholder's
equity $3,304,219 $2,895,226
=================================================================
</TABLE>
See accompanying notes.
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F-2 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, ($ THOUSANDS) 1999 1998 1997
<S> <C> <C> <C>
REVENUES:
- --------------------------------------------------------------------------------------------
Traditional life, disability income and long-term care
insurance premiums $ 15,613 $ 13,852 $ 12,376
Policyholder and contractholder charges 22,502 20,467 18,319
Mortality and expense risk fees 17,019 13,980 11,312
Net investment income 95,514 100,871 106,274
Net realized gains on investments 1,386 2,163 547
- --------------------------------------------------------------------------------------------
Total revenues 152,034 151,333 148,828
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BENEFITS AND EXPENSE:
- --------------------------------------------------------------------------------------------
Death and other benefits:
Traditional life, disability income and long-term care
insurance 5,579 5,553 3,633
Universal life-type insurance and investment contracts 6,313 4,320 3,852
Increase in liabilities for future policy benefits for for
traditional life, disability income and long-term care
insurance 6,098 3,662 3,979
Interest credited on universal life-type insurance and
investment contracts 50,767 55,073 62,294
Amortization of deferred policy acquisition costs 15,787 18,362 17,201
Other insurance and operating expenses 9,925 8,917 10,220
- --------------------------------------------------------------------------------------------
Total benefits and expenses 94,469 95,887 101,179
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Income before income taxes 57,565 55,446 47,649
Income taxes 19,241 19,098 16,471
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Net income $ 38,324 $ 36,348 $ 31,178
============================================================================================
</TABLE>
See accompanying notes.
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IDS LIFE INSURANCE COMPANY OF NEW YORK F-3
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF STOCKHOLDER'S EQUITY
<TABLE>
<CAPTION>
ACCUMULATED
OTHER
TOTAL ADDITIONAL COMPREHENSIVE
STOCKHOLDER'S CAPITAL PAID-IN (LOSS) INCOME, RETAINED
THREE YEARS ENDED DECEMBER 31, 1999 ($ THOUSANDS) EQUITY STOCK CAPITAL NET OF TAX EARNINGS
<S> <C> <C> <C> <C> <C>
COMPREHENSIVE INCOME:
- ---------------------------------------------------------------------------------------------------------------------
Balance, December 31, 1996 $ 229,863 $ 2,000 $ 49,000 $ 6,937 $171,926
Net income 31,178 -- -- -- 31,178
Unrealized holding gains arising during the year,
net of 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)
- ---------------------------------------------------------------------------------------------------------------------
COMPREHENSIVE INCOME:
- ---------------------------------------------------------------------------------------------------------------------
Balance, December 31, 1997 257,279 2,000 49,000 13,175 193,104
Net income 36,348 -- -- -- 36,348
Unrealized holding losses arising during the year,
net of deferred policy acquisition costs of $22
and taxes of $1,415 (2,628) -- -- (2,628) --
Reclassification adjustment for losses included in
net income, net of tax of ($252) 467 -- -- 467 --
- ---------------------------------------------------------------------------------------------------------------------
Other comprehensive loss (2,161) -- -- (2,161) --
Comprehensive income 34,187 -- --
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Cash dividends to parent (12,000) -- -- -- (12,000)
- ---------------------------------------------------------------------------------------------------------------------
Balance, December 31, 1998 279,466 2,000 49,000 11,014 217,452
COMPREHENSIVE INCOME:
- ---------------------------------------------------------------------------------------------------------------------
Balance, December 31, 1998 279,466 2,000 49,000 11,014 217,452
Net income 38,324 -- -- -- 38,324
Unrealized holding losses arising during the year,
net of deferred policy acquisition costs of $737
and of taxes of $13,537 (25,140) -- -- (25,140) --
Reclassification adjustment for gains included in
net income, net of tax of $452 (840) -- -- (840) --
- ---------------------------------------------------------------------------------------------------------------------
Other comprehensive loss (25,980) -- -- (25,980) --
Comprehensive income 12,344 -- --
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Cash dividends to parent (12,000) -- -- -- (12,000)
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Balance, December 31, 1999 $ 279,810 $ 2,000 $ 49,000 $(14,966) $243,776
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
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F-4 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
IDS LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, ($ THOUSANDS) 1999 1998 1997
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
- -----------------------------------------------------------------------------------------------
Net income $ 38,324 $ 36,348 $ 31,178
Adjustments to reconcile net income to net cash provided by
operating activities:
Policy loans, excluding universal life-type insurance:
Issuance (3,063) (3,110) (3,073)
Repayment 2,826 2,660 1,897
Change in accrued investment income 1,528 312 863
Change in amounts recoverable from reinsurer (2,837) (1,760) (1,345)
Change in premiums due 5 (12) (50)
Change in accounts receivable 275 (119) 218
Change in other assets 319 (47) (95)
Change in deferred policy acquisition costs, net (6,015) (2,841) (7,431)
Change in liabilities for future policy benefits for
traditional life, disability income and long-term care
insurance 8,368 5,441 5,131
Change in policy claims and other policyholders' funds (522) (908) 858
Deferred income tax provision (benefit) 2,196 (2,369) (960)
Change in other liabilities (3,513) (3,986) 3,468
Accretion of discount, net (1,794) (342) (352)
Net realized gain on investments (1,386) (2,163) (547)
Policyholder and contractholder charges, non-cash (9,875) (9,661) (8,772)
Other, net 1,859 118 715
- -----------------------------------------------------------------------------------------------
Net cash provided by operating activities $ 26,695 $ 17,561 $ 21,703
CASH FLOWS FROM INVESTING ACTIVITIES:
- -----------------------------------------------------------------------------------------------
Fixed maturities held to maturity:
Maturities, sinking fund payments and calls $ 37,852 $ 46,629 $ 36,511
Sales 790 16,173 12,616
Fixed maturities available for sale:
Purchases (155,690) (86,072) (101,818)
Maturities, sinking fund payments and calls 50,515 96,578 84,229
Sales 89,683 13,180 27,055
Other investments, excluding policy loans:
Purchases (3,598) (9,121) (33,243)
Sales 16,671 21,113 14,233
Change in amounts due from brokers -- -- 995
Change in amounts due to brokers (4,507) (24,547) 26,047
- -----------------------------------------------------------------------------------------------
Net cash provided by investing activities 31,716 73,933 66,625
CASH FLOWS FROM FINANCING ACTIVITIES:
- -----------------------------------------------------------------------------------------------
Activity related to universal life-type insurance and
investment contracts:
Considerations received 68,978 76,009 112,732
Surrenders and death benefits (159,161) (205,946) (251,259)
Interest credited to account balances 50,767 55,073 62,294
Universal life-type insurance policy loans:
Issuance (5,057) (5,222) (4,848)
Repayment 3,186 3,599 2,753
Cash dividend to parent (12,000) (12,000) (10,000)
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Net cash used in financing activities (53,287) (88,487) (88,328)
- -----------------------------------------------------------------------------------------------
Net increase in cash and cash equivalents 5,124 3,007 --
Cash and cash equivalents at beginning of year 3,007 -- --
- -----------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year $ 8,131 $ 3,007 $ --
- -----------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes.
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IDS LIFE INSURANCE COMPANY OF NEW YORK F-5
<PAGE>
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 accounting principles generally accepted in the United States 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 accounting principles
generally accepted in the United States 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 (loss) 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.
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
- --------------------------------------------------------------------------------
F-6 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
values, and current 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.
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>
1999 1998 1997
- --------------------------------------------------------------
<S> <C> <C> <C>
Cash paid during the year for:
Income taxes $20,670 $22,470 $17,811
Interest on borrowings 124 1,600 1,026
</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.
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
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-7
<PAGE>
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.
Amortization of deferred policy acquisition costs requires the use of
assumptions including interest margins, mortality margins, persistency rates,
maintenance expense levels and, for variable products, separate account
performance. For universal life-type insurance and deferred annuities, actual
experience is reflected in the Company's amortization models monthly. As actual
experience differs from the current assumptions, management considers the need
to change key assumptions underlying the amortization models prospectively. The
impact of changing prospective assumptions is reflected in the period that such
changes are made and is generally referred to as an unlocking adjustment. Net
unlocking adjustments in 1999, 1998 and 1997 were not significant.
LIABILITIES FOR FUTURE POLICY BENEFITS
Liabilities for universal-life type insurance and fixed and variable deferred
annuities are accumulation values.
Liabilities for equity indexed deferred annuities are determined as the present
value of guaranteed benefits and the intrinsic value of index-based benefits.
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 5% to 8%.
REINSURANCE
The maximum amount of life insurance risk retained by the Company is $750 on any
policy insuring a single life and $1,500 on any policy insuring a joint-life
combination. Risk not retained is reinsured with other life insurance companies,
primarily on a yearly renewable term basis. Long-term care policies are
primarily reinsured on a coinsurance basis. The Company retains all disability
income and waiver of premium risk. Beginning in 2000, the Company will retain
all accidental death benefit 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
- --------------------------------------------------------------------------------
F-8 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
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, 1999 and 1998 are $366, and
$3,647, 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 account assets 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
American Institute of Certified Public Accountants (AICPA) Statement of Position
(SOP) 98-1, "Accounting for Costs of Computer Software Developed or Obtained for
Internal Use" became effective January 1, 1999. The SOP 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 capitalized by AEFC. As a result, the new rule did not have a
material impact on the Company's results of operations or financial condition.
Effective January 1, 1999, the Company adopted AICPA 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 had historically carried a balance in other liabilities
on the balance sheet for potential guaranty fund assessment exposure. Adoption
of the SOP did not have a material impact on the Company's results of operations
or financial condition.
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities," which is effective January 1, 2001. 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. The
ultimate financial effect of the new rule will be measured based on the
derivatives in place at adoption and cannot be estimated at this time.
PERMITTED STATUTORY ACCOUNTING PRACTICES
The Company's statutory-basis financial statements are prepared in accordance
with accounting practices prescribed or permitted by the New York Insurance
Department. Currently, "prescribed" statutory practices are interspersed
throughout state insurance laws and regulations, the NAIC ACCOUNTING PRACTICES
AND PROCEDURES MANUAL and a variety of other NAIC publications. "Permitted"
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-9
<PAGE>
statutory accounting practices encompass all accounting practices that are not
prescribed: such practices may differ from state to state, may differ from
company to company within a state, and may change in the future.
In 1998, the NAIC adopted codified statutory accounting principles
("Codification") effective January 1, 2001. Codification will likely change, to
some extent, prescribed statutory accounting practices and may result in changes
to the accounting practices that the Company uses to prepare its statutory-basis
financial statements. Codification will require adoption by the various states
before it becomes the prescribed statutory basis of accounting for insurance
companies domesticated within those states. Accordingly, before Codification
becomes effective for the Company, the State of New York must adopt Codification
as the prescribed basis of accounting on which domestic insurers must report
their statutory-basis results to the Insurance Department. New York has not yet
made a decision regarding whether or not it will accept Codification. While
management has not yet determined the impact of Codification to the Company's
statutory-basis financial statements, it does not believe the impact will be
material.
RECLASSIFICATIONS
Certain 1998 and 1997 amounts have been reclassified to conform to the 1999
presentation.
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, 1999 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 $ 2,490 $ 20 $ 150 $ 2,360
Corporate bonds and
obligations 384,241 6,066 7,058 383,249
Mortgage-backed securities 47,612 103 1,320 46,395
- ----------------------------------------------------------------------------------------
$434,343 $ 6,189 $ 8,528 $432,004
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
</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 $ 6 $ -- $ 110
Corporate bonds and
obligations 374,846 2,324 20,325 356,845
Mortgage-backed securities 204,064 580 6,025 198,619
- ----------------------------------------------------------------------------
$579,014 $ 2,910 $26,350 $555,574
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
F-10 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
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 and fair value of investments in fixed maturities at December
31, 1999 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> <C> <C>
Due in one year or less $ 14,966 $ 15,118
Due from one to five years 213,933 214,972
Due from five to ten years 111,707 111,314
Due in more than ten years 46,125 44,205
Mortgage-backed securities 47,612 46,395
- --------------------------------------------------------------------
$434,343 $432,004
- --------------------------------------------------------------------
- --------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AMORTIZED FAIR
AVAILABLE FOR SALE COST VALUE
- --------------------------------------------------------------------
<S> <C> <C> <C> <C>
Due in one year or less $ 14,422 $ 14,657
Due from one to five years 37,204 37,477
Due from five to ten years 214,169 203,150
Due in more than ten years 109,155 101,671
Mortgage-backed securities 204,064 198,619
- --------------------------------------------------------------------
$579,014 $555,574
- --------------------------------------------------------------------
- --------------------------------------------------------------------
</TABLE>
During the years ended December 31, 1999, 1998 and 1997, fixed maturities
classified as held to maturity were sold with amortized cost of $790, $16,175
and $12,737, 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 1999 with proceeds of
$89,683 and gross realized gains and losses of $1,917 and $625, respectively.
Fixed maturities available for sale were sold during 1998 with proceeds of
$13,180 and gross realized gains and
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-11
<PAGE>
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.
At December 31, 1999, bonds carried at $254 were on deposit with the state of
New York as required by law.
At December 31, 1999, 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 $147
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 1999 1998
- ----------------------------------------------------------------
<S> <C> <C>
Aaa/AAA $ 250,577 $ 280,669
Aa/AA 12,992 15,815
Aa/A 25,489 16,327
A/A 150,187 151,838
A/BBB 68,417 68,640
Baa/BBB 354,331 366,776
Baa/BB 23,562 39,666
Below investment grade 127,802 95,186
- ----------------------------------------------------------------
$1,013,357 $1,034,917
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
At December 31, 1999, 94 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, 1999, 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, 1999 DECEMBER 31, 1998
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
REGION SHEET TO PURCHASE SHEET TO PURCHASE
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
West North Central $ 22,686 $ -- $ 24,725 $ --
East North Central 25,195 -- 29,134 59
South Atlantic 31,748 -- 34,175 598
Middle Atlantic 17,672 -- 18,350 --
Pacific 6,751 -- 9,706 --
Mountain 35,608 -- 36,636 --
New England 8,209 -- 7,851 --
East South Central 7,394 -- 7,521 --
West South Central 0 -- 237 --
- --------------------------------------------------------------------------------
155,262 -- 168,335 657
Less allowance for losses 1,200 -- 1,500 --
- --------------------------------------------------------------------------------
$154,062 $ -- $166,835 $657
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
F-12 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
<TABLE>
<CAPTION>
DECEMBER 31, 1999 DECEMBER 31, 1998
ON BALANCE COMMITMENTS ON BALANCE COMMITMENTS
PROPERTY TYPE SHEET TO PURCHASE SHEET TO PURCHASE
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Apartments $ 54,118 $ -- $ 59,019 $ --
Department/retail stores 49,810 -- 54,018 624
Office buildings 22,090 -- 23,902 --
Industrial buildings 16,938 -- 18,590 33
Nursing/retirement 5,058 -- 5,153 --
Medical buildings 7,248 -- 7,416 --
Hotels/motels -- -- 237 --
- --------------------------------------------------------------------------------
155,262 -- 168,335 657
Less allowance for losses 1,200 -- 1,500 --
- --------------------------------------------------------------------------------
$154,062 $ -- $166,835 $657
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</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.
At December 31, 1999 and 1998, the Company's recorded investment in impaired
loans was $nil and $1,268, with allowances of $nil and $300, respectively.
During 1999 and 1998, the average recorded investment in impaired loans was $nil
and $1,282, respectively.
The Company recognized $2, $123 and $126 of interest income related to impaired
loans for the years ended December 31, 1999, 1998 and 1997, respectively.
The following table presents changes in the allowance for investment losses
related to all loans:
<TABLE>
<CAPTION>
1999 1998 1997
- -----------------------------------------------------------
<S> <C> <C> <C>
Balance, January 1 $1,500 $1,500 $1,300
Provision (reduction) for
investment losses (300) -- 200
- -----------------------------------------------------------
Balance, December 31 $1,200 $1,500 $1,500
- -----------------------------------------------------------
- -----------------------------------------------------------
</TABLE>
Net investment income for the years ended December 31 is summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
- ----------------------------------------------------------------
<S> <C> <C> <C>
Interest on fixed maturities $78,342 $ 85,164 $ 92,007
Interest on mortgage loans 12,895 14,599 14,228
Other investment income 4,764 3,365 1,715
Interest on cash equivalents 350 64 91
- ----------------------------------------------------------------
96,351 103,192 108,041
Less investment expenses 837 2,321 1,767
- ----------------------------------------------------------------
$95,514 $100,871 $106,274
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-13
<PAGE>
Net realized gains (losses) on investments for the years ended December 31 is
summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
- -----------------------------------------------------------
<S> <C> <C> <C>
Fixed maturities $1,086 $2,018 $ 844
Mortgage loans 300 -- (200)
Other investments -- 145 (97)
- -----------------------------------------------------------
$1,386 $2,163 $ 547
- -----------------------------------------------------------
- -----------------------------------------------------------
</TABLE>
Changes in net unrealized appreciation (depreciation) of investments for the
years ended December 31 are summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
- --------------------------------------------------------------
<S> <C> <C> <C>
Fixed maturities available for sale $(40,706) $(3,347) $9,599
</TABLE>
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>
1999 1998 1997
- --------------------------------------------------------------
<S> <C> <C> <C>
Federal income taxes:
Current $16,426 $20,192 $16,371
Deferred 2,196 (2,369) (960)
- --------------------------------------------------------------
18,622 17,823 15,411
State income taxes-current 619 1,275 1,060
- --------------------------------------------------------------
Income tax expense $19,241 $19,098 $16,471
- --------------------------------------------------------------
- --------------------------------------------------------------
</TABLE>
Increases (decreases) to the income tax provision applicable to pretax income
based on the statutory rate are attributable to:
<TABLE>
<CAPTION>
1999 1998 1997
PROVISION RATE PROVISION RATE PROVISION RATE
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Federal income taxes
based on the statutory
rate $20,148 35.0% $19,406 35.0% $16,677 35.0%
Increases (decreases) are
attributable to:
Tax-excluded interest and
dividend income (509) (0.9) (660) (1.2) (569) (1.2)
State tax, net of federal
benefit 402 0.7 829 1.5 689 1.4
Other, net (800) (1.4) (477) (0.9) (326) (0.6)
- -------------------------------------------------------------------------------
Total income taxes $19,241 33.4% $19,098 34.4% $16,471 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, 1999, 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.
- --------------------------------------------------------------------------------
F-14 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
Significant components of the Company's deferred income tax assets and
liabilities as of December 31 are as follows:
<TABLE>
<CAPTION>
1999 1998
- ----------------------------------------------------------
<S> <C> <C>
Deferred income tax assets:
Policy reserves $28,245 $29,318
Investments 6,980 --
Other 6,690 6,502
- ----------------------------------------------------------
Total deferred income tax assets 41,915 35,820
- ----------------------------------------------------------
- ----------------------------------------------------------
Deferred income tax liabilities:
Deferred policy acquisition costs 38,033 36,673
Investments -- 7,059
- ----------------------------------------------------------
Total deferred income tax liabilities 38,033 43,732
- ----------------------------------------------------------
Net deferred income tax assets
(liabilities) $ 3,882 ($7,912)
- ----------------------------------------------------------
- ----------------------------------------------------------
</TABLE>
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 IDS Life 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 $155,952 and $132,702 as of
December 31, 1999 and 1998, 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).
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 $27, $37 and $39 in 1999, 1998 and 1997, respectively.
The Company has a "Sales Benefit Plan" which is an unfunded, noncontributory
retirement plan for all eligible financial advisors. Total plan costs for 1999,
1998 and 1997, which are calculated on the basis of commission earnings of the
individual financial advisors, were $1,446, $1,480 and $1,965, 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 1999, 1998 and 1997 were $218, $252 and $312,
respectively.
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-15
<PAGE>
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 1999, 1998 and 1997 were $nil.
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 1999, 1998 and
1997 were $96, $140 and $1,490, 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 $13,042, $9,403 and $11,589 for 1999, 1998 and
1997, respectively. Certain of these costs are included in deferred policy
acquisition costs.
7. COMMITMENTS AND CONTINGENCIES
In January 2000, AEFC reached an agreement in principle to settle three
class-action lawsuits. The Company had been named as a co-defendant in one of
these lawsuits. It is expected the settlement will provide $215 million of
benefits to more than 2 million participants. The agreement in principle to
settle also provides for release by class members of all insurance and annuity
market conduct claims dating back to 1985 and is subject to a number of
contingencies including a definitive agreement and court approval. The portion
of the settlement allocated to the Company did not have a material impact on the
Company's financial position or results from operations.
At December 31, 1999 and 1998, traditional life insurance and universal
life-type insurance in force aggregated $5,448,451 and $4,941,727 respectively,
of which $272,276 and $248,280 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 $150, $134 and $115
for the years ended December 31, 1999, 1998 and 1997, respectively. Claim
recoveries under the terms of this reinsurance agreement were $nil, $nil and
$963 in 1999, 1998 and 1997, respectively.
Premiums ceded to reinsurers other than IDS Life amounted to $2,873, $2,178 and
$1,583 for the years ended December 31, 1999, 1998 and 1997, respectively. Claim
recoveries from reinsurers other than IDS Life amounted to $473, $228 and $1,366
for the years ended December 31, 1999, 1998 and 1997, 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
$237,038 and $267,806 at December 31, 1999 and 1998, respectively. The
accompanying statement of income includes premiums of $nil for the years ended
December 31, 1999, 1998 and 1997, and decreases in liabilities for future policy
benefits of $1,277, $1,742 and $1,889 related to this agreement for the years
ended December 31, 1999, 1998 and 1997, respectively.
- --------------------------------------------------------------------------------
F-16 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
8. LINES OF CREDIT
The Company has an available line of credit with AEFC aggregating $25,000. The
interest rate for any borrowing is established by reference to various indicies
plus 20 to 45 basis points depending on the term. There were no borrowings
outstanding under this agreement at December 31, 1999 or 1998.
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. The Company's counterpart is 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>
NOTIONAL CARRYING FAIR TOTAL CREDIT
DECEMBER 31, 1999 AMOUNT AMOUNT VALUE EXPOSURE
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Assets:
Interest rate caps $200,000 $ -- $ -- $ --
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1998
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Assets:
Interest rate caps $200,000 $566 $ 2 $ 2
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</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.
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-17
<PAGE>
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>
1999 1998
CARRYING FAIR CARRYING FAIR
FINANCIAL ASSETS AMOUNT VALUE AMOUNT VALUE
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investments:
Fixed maturities (Note 2):
Held to maturity $ 434,343 $ 432,004 $ 473,592 $ 503,909
Available for sale 555,574 555,574 578,591 578,591
Mortgage loans on real
estate (Note 2) 154,062 152,942 166,835 178,559
Other:
Derivative financial
instruments (Note 9) -- -- 566 2
Separate accounts assets
(Note 1) 1,957,703 1,957,703 1,491,679 1,491,679
</TABLE>
<TABLE>
<CAPTION>
1999 1998
CARRYING FAIR CARRYING FAIR
FINANCIAL LIABILITIES AMOUNT VALUE AMOUNT VALUE
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Future policy benefits for
fixed annuities $ 732,752 $ 715,213 $ 788,780 $ 765,430
Separate account liabilities 1,722,028 1,668,067 1,355,430 1,302,422
</TABLE>
At December 31, 1999 and 1998, the carrying amount and fair value of future
policy benefits for fixed annuities exclude life insurance-related contracts
carried at $83,646 and $81,358, respectively, and policy loans of $5,594 and
$5,369, respectively. The fair value of these benefits is based on the status of
the annuities at December 31, 1999 and 1998. 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 1999 and 1998.
At December 31, 1999 and 1998, 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 $235,675 and $136,249,
respectively.
- --------------------------------------------------------------------------------
F-18 IDS LIFE INSURANCE COMPANY OF NEW YORK
<PAGE>
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>
1999 1998 1997
- -----------------------------------------------------------------
<S> <C> <C> <C>
Net income, per accompanying
financial statements $ 38,324 $ 36,348 $ 31,178
Deferred policy acquisition costs (6,015) (2,841) (7,432)
Adjustments of future policy
benefit liabilities (4,615) (6,199) (4,928)
Deferred income tax benefit 2,196 (2,369) (960)
Provision for losses on investments (161) 862 296
IMR gain/loss transfer and
amortization (154) (1,451) (119)
Adjustment to separate account
reserves 5,498 2,767 10,267
Other, net 766 (350) 430
- -----------------------------------------------------------------
Net income, on basis of statutory
accounting practices $ 35,839 $ 26,767 $ 28,732
- -----------------------------------------------------------------
- -----------------------------------------------------------------
Stockholder's equity, per
accompanying financial statements $279,810 $279,466 $257,279
Deferred policy acquisition costs (136,229) (129,477) (126,614)
Adjustments of future policy
benefit liabilities 2,845 4,697 9,452
Deferred income taxes (3,881) 7,912 11,445
Asset valuation reserve (16,164) (15,516) (16,698)
Adjustments of separate account
liabilities 61,721 56,223 53,456
Adjustments of investments to
amortized cost 23,440 (17,266) (20,613)
Premiums due, deferred and advance 1,485 1,381 1,237
Deferred revenue liability 3,021 2,482 1,941
Allowance for losses 1,200 1,500 1,645
Non-admitted assets (421) (450) (552)
Interest maintenance reserve (3,155) (3,001) (1,551)
Other, net (5,416) (2,915) (1,463)
- -----------------------------------------------------------------
Stockholder's equity, on basis of
statutory accounting practices $208,256 $185,036 $168,963
- -----------------------------------------------------------------
- -----------------------------------------------------------------
</TABLE>
12. YEAR 2000 (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
major systems used by the Company are maintained by AEFC and are utilized by
multiple subsidiaries and affiliates of AEFC. The Company's businesses are
heavily dependent upon AEFC's computer systems and have significant interaction
with systems of third parties.
A comprehensive review of AEFC's computer systems and business processes,
including those specific to the Company, was conducted to identify the major
systems that could be affected by the Year 2000 issue. Steps were taken to
resolve potential problems including modification to existing software and the
purchase of new software. As of December 31, 1999, AEFC had completed its
program of corrective measures on its internal systems and applications,
including Year 2000 compliance testing. As of December 31, 1999, AEFC had also
completed an evaluation of the Year 2000 readiness of other third parties whose
system failures could have an impact on the Company's operations.
- --------------------------------------------------------------------------------
IDS LIFE INSURANCE COMPANY OF NEW YORK F-19
<PAGE>
AEFC's Year 2000 project also included 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. At December 31, 1999, these plans had been amended to include
specific Year 2000 considerations.
In assessing its Year 2000 initiatives and the results of actual production
since January 1, 2000, management believes no material adverse consequences were
experienced, and there was no material effect on the Company's business, results
of operations, or financial condition as a result of the Year 2000 issue.
- --------------------------------------------------------------------------------
F-20 IDS LIFE INSURANCE COMPANY OF NEW YORK
<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, 1999.
Statements of Operations for year ended Dec. 31, 1999.
Statements of Changes in Net Assets for year ended
Dec. 31, 1999 and 1998.
Notes to Financial Statements.
Report of Independent Auditors dated March 17, 2000.
IDS Life Insurance Company of New York:
Balance Sheets as of Dec. 31, 1999 and Dec. 31, 1998.
Statements of Income for years ended Dec. 31, 1999, 1998
and 1997.
Statements of Stockholder's Equity, for years ended Dec. 31,
1999, 1998 and 1997.
Statements of Cash Flows for years ended Dec. 31, 1999, 1998
and 1997.
Notes to Financial Statements.
Report of Independent Auditors dated February 3, 2000.
(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 27, 2000, 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 as Exhibit 14 to Registrant's
Post-Effective Amendment No. 9 to Registration Statement No. 33-45776
is incorporated herein by reference.
<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 200 AXP Financial Center Director and President
Minneapolis, MN 55474
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 200 AXP Financial Center Executive Vice President,
Minneapolis, MN 55474 Institutional Products Group
Robert R. Grew 20 Madison Avenue Extension Director
Albany, NY
Lorraine R. Hart 200 AXP Financial Center Vice President, Investments
Minneapolis, MN 55474
Jeffrey S. Horton 200 AXP Financial Center Vice President and Treasurer
Minneapolis, MN 55474
Jean B. Keffeler 3424 Zenith Ave. So. Director
Minneapolis, MN
Richard W. Kling 200 AXP Financial Center Director and Chairman of the Board
Minneapolis, MN 55474
Bruce A. Kohn 200 AXP Financial Center Counsel and Assistant Secretary
Minneapolis, MN 55474
Eric L. Marhoun 200 AXP Financial Center General Counsel and Secretary
Minneapolis, MN 55474
Thomas R. McBurney 1700 Foshay Tower Director
821 Marquette Ave.
Minneapolis, MN
Mary Ellyn Minenko 200 AXP Financial Center Counsel and Assistant Secretary
Minneapolis, MN 55474
Edward J. Muhl 200 AXP Financial Center Director
Minneapolis, MN 55474
Thomas V. Nicolosi Suite 220 Director
500 Mamaroneck Avenue
Harrison, NY 10528
Stephen P. Norman World Financial Center Director
New York, NY
<PAGE>
Richard M. Starr 20 Madison Avenue Extension Director
Albany, NY
William A. Stoltzmann 200 AXP Financial Center Counsel and Assistant Secretary
Minneapolis, MN 55474
Philip C. Wentzel 200 AXP Financial Center Vice President and Controller, Risk
Minneapolis, MN 55474 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).
<TABLE>
<CAPTION>
The following list includes the names of major subsidiaries of
American Express.
<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
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
<PAGE>
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, 2000, there were 40 contract owners of qualified contracts.
There were 220 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) Salomon Smith Barney Inc. currently acts as principal underwriter for
various investment companies and various series of unit investment trusts.
Salomon Smith Barney Inc. is a wholly owned subsidiary of Salomon 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 Salomon Smith Barney Inc. is incorporated by reference to
Schedule A of Form BD filed by Salomon 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 27th day of April,
2000.
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 27th day of
April, 2000.
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, Consumer Affairs Officer and
Claims 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 as Exhibit 14 to Post-Effective Amendment No. 9 to Registration
Statement No. 33-45776, is incorporated herein by reference.
/s/ Mary Ellyn Minenko
Mary Ellyn Minenko
<PAGE>
CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 10
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.
IDS LIFE OF NEW YORK ACCOUNT SBS (Symphony - NY)
Registration No. 33-45776/811-6560
9. Opinion of Counsel and Consent.
10. Consent of Independent Auditors.
April 27, 2000
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
Vice President, Group Counsel and Assistant Secretary
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Independent Auditors"
in the Statement of Additional Information and to the use of our report dated
February 3, 2000 with respect to the financial statements IDS Life Insurance
Company of New York and to the use of our report dated March 17, 2000 with
respect to the financial statements of IDS Life Account SBS, included in
Post-Effective Amendment No. 10 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
Ernst & Young
Minneapolis, Minnesota
April 24, 2000
