PROVIDIAN LIFE & HEALTH INSURANCE CO SEPARATE ACCOUNT V, 497, 1996-11-01

PROVIDIAN LIFE & HEALTH INSURANCE CO SEPARATE ACCOUNT V
497, 1996-11-01

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PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY SEPARATE ACCOUNT V
PROSPECTUS
FOR THE

PROVIDIAN PRISM VARIABLE ANNUITY A UNITS
OFFERED BY
PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY
(A MISSOURI STOCK COMPANY)
ADMINISTRATIVE OFFICES
P.O. BOX 32700
LOUISVILLE, KENTUCKY 40232

The Providian PRISM variable annuity A Unit contract (the "Contract"), offered
through Providian Life and Health Insurance Company (the "Company", "us", "we"
or "our"), provides a vehicle for investing on a tax-deferred basis in five
Portfolios sponsored by Calvert Group, Ltd. ("Calvert"), one Portfolio offered
by The Dreyfus Socially Responsible Growth Fund, Inc., and our General
Account. The Contract is an individual variable annuity contract and is
intended for retirement savings or other long-term investment purposes.

The minimum initial Purchase Payment for Non-Qualified Contracts is $5,000.
The minimum initial Purchase Payment for Qualified Contracts is $2,000 (or $50
monthly by payroll deduction). The Contract is a flexible-premium deferred
annuity that provides for a Right to Cancel Period of 10 days (30 days or more
in some instances) plus a 5 day grace period to allow for mail delivery during
which you may cancel your investment in the Contract.

Your Purchase Payments for the Contract may be allocated among six Subaccounts
of Providian Life and Health Insurance Company's Separate Account V and three
fixed options available under the Company's General Account. Assets of each
Subaccount are invested in one of the following Portfolios (which are
contained within two open-end, diversified investment companies):

.Calvert Responsibly Invested .Calvert Responsibly Invested Money
Capital Accumulation Portfolio Market Portfolio
.Calvert Responsibly Invested
.Calvert Responsibly Invested Global Strategic Growth Portfolio
Equity Portfolio
.Dreyfus Socially Responsible Growth
.Calvert Responsibly Invested Portfolio
Balanced Portfolio

Depending upon the state of issue and provisions of your Contract, your
initial Net Purchase Payment(s) will, when your Contract is issued, either be
(i) invested in the CRI Money Market Portfolio during your Right to Cancel
Period and/or invested immediately in your chosen Guaranteed Index Rate
Options or (ii) invested immediately in your chosen Portfolios and fixed
options (other than the Five-Year Guaranteed Equity Option).

The Contract's Accumulated Value varies with the investment performance of the
Portfolios you select. You bear all investment risk associated with the
Portfolios. Investment results for your Contract are not guaranteed except to
the extent of the portion of the Accumulated Value allocated to the General
Account.

The Contract offers a number of ways of withdrawing monies at a future date,
including a lump sum payment and several Annuity Payment Options. Full or
partial withdrawals from the Contract's Surrender Value may be made at any
time, although in many instances withdrawals made prior to age 59 1/2 are
subject to a 10% penalty tax (and a portion may be subject to ordinary income
taxes). The Contract has an initial sales charge of up to 5.75%. If you elect
an Annuity Payment Option, Annuity Payments may be received on a fixed and/or
variable basis. You also have significant flexibility in choosing the Annuity
Date on which Annuity Payments begin.

Providian Prism Contracts are offered in two versions with differing charge
structures and features. THIS PROSPECTUS DESCRIBES ONLY THE PROVIDIAN PRISM A
UNIT CONTRACT. Also available is a standard Providian Prism Contract which is
offered only by the appropriate prospectus. For further information see
"Alternate Contract Version" at page 7.

This Prospectus sets forth the information you should know before investing in
the Contract. It must be accompanied by the current Prospectus for each Fund.
Please read the Prospectuses carefully and retain them for future reference. A
Statement of Additional Information, dated April 30, 1996 and supplemented
November 1, 1996, for the Contract Prospectus has also been filed with the
Securities and Exchange Commission, is incorporated herein by reference and is
available free by calling our Administrative Offices at 1-800-866-6007. The
Table of Contents of the Statement of Additional Information is included at
the end of this Prospectus.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.

The Contract is not available in all States.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO DEALER, SALESMAN, OR OTHER PERSON
IS AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS IN
CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON.

The date of this Prospectus is April 30, 1996 as revised November 1, 1996.

FM-1164(A)
<PAGE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C>
GLOSSARY................................................................... 2
HIGHLIGHTS................................................................. 5
FEE TABLE.................................................................. 7
Condensed Financial Information............................................ 9
Financial Statements....................................................... 9
Performance Measures....................................................... 9
Additional Performance Measures............................................ 10
Yield and Effective Yield.................................................. 10
The Company and the Separate Account....................................... 11
Acacia Capital Corporation................................................. 11
Calvert Group, Ltd......................................................... 11
The Dreyfus Socially Responsible Growth Fund, Inc.......................... 11
The Portfolios............................................................. 11
CONTRACT FEATURES.......................................................... 13
Right to Cancel Period................................................... 13
Contract Purchase and Purchase Payments.................................. 13
Purchasing by Wire....................................................... 14
Allocation of Purchase Payments.......................................... 14
Charges and Deductions................................................... 14
Accumulated Value........................................................ 16
Exchanges Among the Portfolios........................................... 16
Full and Partial Withdrawals............................................. 17
Systematic Withdrawal Option............................................. 17
Dollar Cost Averaging Option............................................. 18
IRS-Required Distributions............................................... 18
Minimum Balance Requirement.............................................. 18
Designation of an Annuitant's Beneficiary................................ 19
Death of Annuitant Prior to Annuity Date................................. 19
Annuity Date............................................................. 19
Lump Sum Payment Option.................................................. 20
Annuity Payment Options.................................................. 20
Deferment of Payment..................................................... 21
FEDERAL TAX CONSIDERATIONS................................................. 21
GENERAL INFORMATION........................................................ 25
APPENDIX A
The General Account...................................................... A-1
</TABLE>

GLOSSARY

Accumulation Unit - A measure of your ownership interest in the Contract prior
to the Annuity Date.

Accumulation Unit Value - The value of each Accumulation Unit which is
calculated each Valuation Period.

Accumulated Value - The value of all amounts accumulated under the Contract
prior to the Annuity Date.

Adjusted Death Benefit - The sum of all Net Purchase Payments made during the
first six Contract Years, less any partial withdrawals taken. During each
subsequent six-year period, the Adjusted Death Benefit will be the Death
Benefit on the last day of the previous six-year period plus any Net Purchase
Payments made, less any partial withdrawals taken during the current six-year
period. After the Annuitant attains age 75, the Adjusted Death Benefit will
remain equal to the Death Benefit on the last day of the six-year period
before age 75 occurs plus any Net Purchase Payments subsequently made, less
any partial withdrawals subsequently taken.

Annual Contract Fee - The $30 annual fee charged by the Company to cover the
cost of administering each Contract. The Annual Contract Fee will be deducted
on each Contract Anniversary and upon surrender, on a pro rata basis, from
each Subaccount.

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Annuitant - The person whose life is used to determine the duration of any
Annuity Payments and upon whose death, prior to the Annuity Date, benefits
under the Contract are paid.

Annuitant's Beneficiary - The person(s) to whom any benefits are due upon the
Annuitant's death prior to the Annuity Date.

Annuity Date - The date on which Annuity Payments begin. The Annuity Date is
always the first day of the month you specify.

Annuity Payment - One of a series of payments made under an Annuity Payment
Option.

Annuity Payment Option - One of several ways in which withdrawals from the
Contract may be made. Under a Fixed Annuity Option (see "Annuity Payment
Options," page 20), the dollar amount of each Annuity Payment does not change
over time. Under a Variable Annuity Option (see "Annuity Payment Options,"
page 20), the dollar amount of each Annuity Payment may change over time,
depending upon the investment experience of the Portfolio or Portfolios you
choose. Annuity Payments are based on the Contract's Accumulated Value as of
10 Business Days prior to the Annuity Date.

Annuity Unit - Unit of measure used to calculate Variable Annuity Payments
(see "Annuity Payment Options," page 20).

Annuity Unit Value - The value of each Annuity Unit which is calculated each
Valuation Period.

Business Day - A day when the New York Stock Exchange is open for trading.

Company ("we", "us", "our") - Providian Life and Health Insurance Company, a
Missouri stock company.

Contract Anniversary - Any anniversary of the Contract Date.

Contract Date - The date of issue of this Contract.

Contract Owner ("you", "your") - The person or persons designated as the
Contract Owner in the Contract. The term shall also include any person named
as Joint Owner. A Joint Owner shares ownership in all respects with the
Contract Owner. Prior to the Annuity Date, the Contract Owner has the right to
assign ownership, designate beneficiaries, make permitted withdrawals and
Exchanges among Subaccounts and Guaranteed Index Rate Options.

Contract Year - A period of 12 months starting with the Contract Date or any
Contract Anniversary.

Death Benefit - The greater of the Contract's Accumulated Value on the date
the Company receives due Proof of Death of the Annuitant or the Adjusted Death
Benefit. If any portion of the Contract's Accumulated Value on the date we
receive proof of the Annuitant's death is derived from the Five-Year
Guaranteed Index Rate Option, that portion of the Accumulated Value will be
adjusted by a positive Market Value Adjustment Factor (see "Five-Year
Guaranteed Index Rate Option," at Appendix A), if applicable.

Exchange - One Exchange will be deemed to occur with each voluntary transfer
from any Subaccount or General Account Guaranteed Option.

Funds - Each of (i) Acacia Capital Corporation, a diversified, open-end
management investment company incorporated in Maryland and sponsored by
Calvert Group, Ltd., and (ii) The Dreyfus Socially Responsible Growth Fund,
Inc., an open-end, diversified management investment company incorporated
under Maryland law. The Separate Account invests in the Portfolios of the
Funds.

General Account - The account which contains all of our assets other than
those held in our separate accounts (see "The General Account," at Appendix
A).

General Account Guaranteed Option - Any of the following three General Account
options offered by your Contract and to which you may allocate your Net
Purchase Payments: the One-Year Guaranteed Index Rate Option, the Five-Year
Guaranteed Index Rate Option, and the Five-Year Guaranteed Equity Option. The
General Account Guaranteed Options are available for sale in most, but not
all, states (see "The General Account," at Appendix A).

Guaranteed Index Rate Options - The One-Year Guaranteed Index Rate Option and
the Five-Year Guaranteed Index Rate Option.

Market Value Adjustment Factor - The formula applied to the Accumulated Value
in order to determine the net amount of any transfer or surrender under the
Five-Year Guaranteed Index Rate Option (see "Five-Year Guaranteed Index Rate
Option," at Appendix A).

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Net Purchase Payment - Any Purchase Payment less the applicable sales load and
Premium Tax, if any.

Non-Qualified Contract - A Contract which does not qualify for favorable tax
treatment under the Internal Revenue Code of 1986, as amended (the "Code").

Owner's Designated Beneficiary - The person to whom ownership of this Contract
passes upon the Contract Owner's death, unless the Contract Owner was also the
Annuitant--in which case the Annuitant's Beneficiary is entitled to the Death
Benefit. (Note: this transfer of ownership to the Owner's Designated
Beneficiary will generally not be subject to probate, but will be subject to
estate and inheritance taxes. Consult with your tax and estate adviser to be
sure which rules will apply to you.)

Payee - The Contract Owner, Annuitant, Annuitant's Beneficiary, or any other
person, estate, or legal entity to whom benefits are to be paid.

Portfolio - A separate investment portfolio of the Funds. The Funds currently
offer six Portfolios in the Providian PRISM Variable Annuity: the Calvert
Responsibly Invested Money Market Portfolio ("CRI Money Market"), the Calvert
Responsibly Invested Balanced Portfolio ("CRI Balanced"), the Calvert
Responsibly Invested Capital Accumulation Portfolio ("CRI Capital
Accumulation"), the Calvert Responsibly Invested Global Equity Portfolio ("CRI
Global Equity"), and the Calvert Responsibly Invested Strategic Growth
Portfolio ("CRI Strategic Growth") of Acacia Capital Corporation; and Dreyfus
Socially Responsible Growth Portfolio ("Dreyfus Socially Responsible Growth")
of The Dreyfus Socially Responsible Growth Fund, Inc. (each, a "Portfolio" and
collectively, the "Portfolios"). In this Prospectus, Portfolio will also be
used to refer to the Subaccount that invests in the corresponding Portfolio.

Premium Tax - A regulatory tax that may be assessed by certain states on the
Purchase Payments you make to this Contract. The amount which we must pay as
Premium Tax will be deducted from each Purchase Payment or from your
Accumulated Value as it is incurred by us.

Proof of Death - (a) A certified death certificate; (b) a certified decree of
a court of competent jurisdiction as to the finding of death; (c) a written
statement by a medical doctor who attended the deceased; or (d) any other
proof of death satisfactory to the Company.

Purchase Payment - Any premium payment. The minimum initial Purchase Payment
is $5,000 for Non-Qualified Contracts and $2,000 for Qualified Contracts (or
$50 monthly by payroll deduction); each additional Purchase Payment must be at
least $500 for Non-Qualified Contracts or $50 for Qualified Contracts.
Purchase Payments may be made at any time prior to the Annuity Date as long as
the Annuitant is living.

Qualified Contract - An annuity contract as defined under Sections 403(b) and
408(b) of the Internal Revenue Code of 1986, as amended (the "Code").

Right to Cancel Period - The period during which the Contract can be canceled
and treated as void from the Contract Date.

Separate Account - That portion of Providian Life and Health Insurance Company
Separate Account V dedicated to the Contract. The Separate Account consists of
assets that are segregated by National Home Life Assurance Company and, for
Contract Owners, invested in the Portfolios of Acacia Capital Corporation and
The Dreyfus Socially Responsible Growth Fund, Inc. The Separate Account is
independent of the general assets of the Company.

Subaccount - That portion of the Separate Account that invests in shares of
the Funds' Portfolios. Each Subaccount will only invest in a single Portfolio.
The investment performance of each Subaccount is linked directly to the
investment performance of one of the eight Portfolios of the Funds.

Surrender Value - The Accumulated Value, adjusted to reflect any applicable
Market Value Adjustment (see "Five-Year Guaranteed Index Rate Option," at
Appendix A) for amounts allocated to the Five-Year Guaranteed Index Rate
Option, less any early withdrawal charges for amounts allocated to the One-
Year Guaranteed Index Rate Option, less any amount allocated to the Five-Year
Guaranteed Equity Option, less any Premium Taxes incurred but not yet
deducted.

Valuation Period - The relative performance of your Contract is measured by
the Accumulation Unit Value. This value is calculated each Valuation Period. A
Valuation Period is defined as the period of time between the close of
business on one Business Day and the close of business on the following
Business Day.

4
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HIGHLIGHTS

YOU CAN FIND DEFINITIONS OF IMPORTANT TERMS IN THE GLOSSARY (PAGE 2).

THE PROVIDIAN PRISM VARIABLE ANNUITY A UNITS

The Contract provides a vehicle for investing on a tax-deferred basis in five
Portfolios sponsored by Calvert Group, Ltd., one Portfolio available through
The Dreyfus Socially Responsible Growth Fund, Inc. and three General Account
Guaranteed Options offered by the Company. Monies may be subsequently
withdrawn from the Contract either as a lump sum or as annuity income as
permitted under the Contract. Accumulated Values and Annuity Payments depend
on the investment experience of the selected Portfolios and/or the guarantees
of the General Account Guaranteed Options. The investment performance of the
Portfolios is not guaranteed. Thus, you bear all investment risk for monies
invested under the Contract except to the extent a portion of your Accumulated
Value is allocated to the General Account. The General Account Guaranteed
Options are available for sale in most, but not all, states.

WHO SHOULD INVEST

The Contract is designed for investors seeking long term, tax-deferred
accumulation of funds, generally for retirement but also for other long-term
investment purposes. The tax-deferred feature of the Contract is most
attractive to investors in high federal and state marginal income tax
brackets. The Contract is offered as both a Qualified Contract and a Non-
Qualified Contract. Both Qualified and Non-Qualified Contracts offer tax-
deferral on increases in the Contract's value prior to withdrawal or
distribution--however, Purchase Payments made by Contract Owners of Qualified
Contracts may be deductible from gross income in the year such payments are
made, subject to certain statutory restrictions and limitations. (See "Federal
Tax Considerations" page 21).......................................Page 21

INVESTMENT CHOICES

Your investment in the Contract may be allocated among several Subaccounts of
the Separate Account and/or the General Account Guaranteed Options. The
Subaccounts in turn invest exclusively in five Portfolios of Acacia Capital
Corporation (the "Acacia Fund") available as part of the Providian PRISM
variable annuity and in one Portfolio of The Dreyfus Socially Responsible
Growth Fund, Inc. (the "Dreyfus Fund"). The Acacia Fund offers five
Portfolios: the CRI Money Market, CRI Balanced, CRI Capital Accumulation, CRI
Global Equity, and CRI Strategic Growth. The Dreyfus Fund offers shares in
Dreyfus Socially Responsible Growth. The assets of each Portfolio are
separate, and each Portfolio has distinct investment objectives and policies
as described in the corresponding Fund or Portfolio Prospectus. The General
Account Guaranteed Options are available for sale in most, but not all,
states.............................................................Page 11

CONTRACT OWNER

The Contract Owner is the person designated as the owner of the Contract in
the Contract application. The Contract Owner may designate any person as a
Joint Owner. A Joint Owner shares ownership in all respects with the Contract
Owner. Prior to the Annuity Date, the Contract Owner has the right to assign
ownership, designate beneficiaries, and make permitted withdrawals and
Exchanges among the Subaccounts and General Account Guaranteed Options.

ANNUITANT

The Annuitant is a person whose life is used to determine the duration of any
Annuity Payments and upon whose death, prior to the Annuity Date, benefits
under the Contract are paid. The Annuitant may not be older than Age 75.

ANNUITANT'S BENEFICIARY

The Contract Owner may designate any person to receive benefits under the
Contract which are payable upon the death of the Annuitant prior to the
Annuity Date.

HOW TO INVEST

To invest in the Contract, please consult your agent who will provide the
necessary information to us in a customer order form. You will need to select
an Annuitant. The Annuitant may not be older than age 75. The minimum initial
Purchase Payment is $5,000 for Non-Qualified Contracts, and $2,000 (or $50
monthly by payroll deduction) for Qualified Contracts; subsequent Purchase
Payments must be at least $500 for Non-Qualified Contracts or $50 for
Qualified Contracts. You may make subsequent Purchase Payments at any time
before the Contract's Annuity Date, as long as the Annuitant specified in the
Contract is living................................................ Page 13

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ALLOCATION OF PURCHASE PAYMENTS

If the state of issue of your Contract is CA, GA, ID, LA, MI, MO, NE, NH, NC,
OK, OR, SC, UT, VA or WV, then your initial Net Purchase Payment(s) will, when
your Contract is issued, be invested in CRI Money Market until the expiration
of the Right to Cancel Period of 10 to 30 days or more in some instances as
specified in your Contract when issued (plus a 5 day grace period to allow for
mail delivery) and then invested according to your initial allocation
instructions, provided that you may elect to have the portion of your initial
Net Purchase Payment(s) allocated to the Guaranteed Index Rate Options
invested immediately upon our receipt thereof in order to lock in the rates
then applicable to such options. Notwithstanding the foregoing, any interest
accrued on amounts held in the CRI Money Market during the Right to Cancel
Period will remain in the CRI Money Market upon expiration of the Right to
Cancel Period if it is selected as an initial option.

If the state of issue of your Contract is any other state, your initial Net
Purchase Payment(s) will, unless you indicate otherwise, be invested in your
Portfolios and Guaranteed Index Rate Options immediately upon our receipt
thereof, IN WHICH CASE YOU WILL BEAR FULL INVESTMENT RISK FOR ANY AMOUNTS
ALLOCATED TO THE PORTFOLIOS DURING THE RIGHT TO CANCEL PERIOD. (Please note
that immediate investment is not available with respect to any amounts
allocated to THE FIVE-YEAR GUARANTEED EQUITY OPTION WHICH IS ILLIQUID FOR FIVE
YEARS.) You must fill out and send us the appropriate form or comply with
other designated Company procedures if you would like to change how subsequent
Net Purchase Payments are allocated. ............................. Page 14

RIGHT TO CANCEL PERIOD

The Contract provides for a Right to Cancel Period of 10 days (30 or more days
in some instances as specified in your Contract) plus a 5 day grace period to
allow for mail delivery during which you may cancel your investment in the
Contract. To cancel your investment, please return your Contract to us or to
the agent from whom you purchased the Contract. When we receive the Contract,
(1) if the state of issue of your Contract is CA, GA, ID, LA, MI, MO, NE, NH,
NC, OK, OR, SC, UT, VA or WV, then for any amount of your initial Purchase
Payment(s) invested in CRI Money Market, we will return the Accumulated Value
of the amount of your Purchase Payment(s) so invested, or if greater, the
amount of your Purchase Payment(s) so invested, (2) for any amount of your
initial Purchase Payment(s) invested in the Portfolios immediately following
receipt by us, we will return the Accumulated Value of your Purchase
Payment(s) so invested plus any loads, fees and/or Premium Taxes that may have
been subtracted from such amount, and (3) for any amount of your initial
Purchase Payment(s) invested in the Guaranteed Index Rate Options immediately
following receipt by us, we will refund the amount of your Purchase Payment(s)
so invested....................................................... Page 13

EXCHANGES

You may make unlimited Exchanges among the Portfolios or into the General
Account Guaranteed Options, provided you maintain a minimum balance of $250 in
each Subaccount or $1,000 in each General Account Guaranteed Option,
respectively, to which you have allocated a portion of your Accumulated Value.
No fee currently is imposed for such Exchanges, however, we reserve the right
to charge a $15 fee for Exchanges in excess of 12 per Contract Year. Exchanges
must not reduce the value of any Subaccount or General Account Guaranteed
Option below $250 or $1,000, respectively, or that remaining amount will be
transferred to your other Subaccounts or General Account Guaranteed Options on
a pro rata basis. The Five-Year Guaranteed Equity Option is illiquid for the
entire five-year guarantee period, and transfers from the Guaranteed Index
Rate Options may be subject to additional limitations and charges. (See also
"Charges and Deductions," page 14, and "The General Account," at Appendix
A.)............................................................... Page 16

DEATH BENEFIT

If the Annuitant specified in your Contract dies prior to the Annuity Date,
your named Annuitant's Beneficiary will receive a Death Benefit under the
Contract. The Death Benefit is the greater of your Accumulated Value (plus any
positive Market Value Adjustment applicable under the Five-Year Guaranteed
Index Rate Option) or the Adjusted Death Benefit on the date we receive due
proof of the Annuitant's death. During the first six Contract Years, the
Adjusted Death Benefit will be the sum of all Net Purchase Payments made, less
any partial withdrawals taken. During each subsequent six-year period, the
Adjusted Death Benefit will be the Death Benefit on the last day of the
previous six-year period plus any Net Purchase Payments made, less any partial
withdrawals taken during the current six-year period. After the Annuitant
attains age 75, the Adjusted Death Benefit will remain equal to the Death
Benefit on the last day of the six-year period before age 75 occurs plus any
Net Purchase Payments subsequently made, less any partial withdrawals
subsequently taken. The Annuitant's Beneficiary may elect to receive these
proceeds as a lump sum or as Annuity Payments. If the Annuitant dies on or
after the Annuity Date, any unpaid payments certain will be paid, generally to
the Annuitant's Beneficiary, in accordance with the Contract...... Page 19

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ANNUITY PAYMENT OPTIONS

In addition to the full and partial withdrawal privileges, you may also choose
to create an income stream by requesting an annuity income from us. As the
Contract Owner, you may elect one of several Annuity Payment Options. By
electing an Annuity Payment Option, you are asking us to systematically
liquidate your annuity. We provide you with a variety of options as it relates
to those payments. At your discretion, payments may be either fixed or
variable or both. Fixed payouts are guaranteed for a designated period or for
life (either single or joint). Variable payments will vary depending on the
performance of the underlying Portfolio or Portfolios selected.... Page 20

CONTRACT AND POLICYHOLDER INFORMATION

If you have questions about your Contract, please telephone our Administrative
Offices at 1-800-866-6007 between the hours of 8:00 A.M. to 5:00 P.M. Eastern
time. Please have the Contract number and the Contract Owner's name ready when
you call. As Contract Owner you will receive periodic statements confirming
any financial transactions that take place, as well as quarterly statements
and an annual statement.

CHARGES AND DEDUCTIONS UNDER THE CONTRACT

Providian Prism A Unit Contacts have a front-end sales load of up to 5.75% and
an annual mortality and expense risk charge of .65%.

Contracts also include administrative charges and policy fees which pay for
administering the Contracts, and management, advisory and other fees, which
reflect the costs of the Funds.................................... Page 14

FULL AND PARTIAL WITHDRAWALS

You may withdraw all or part of the Surrender Value of the Contract before the
earlier of the Annuity Date or the Annuitant's death. Withdrawals made prior
to age 59 1/2 may be subject to a 10% penalty tax................. Page 17

ALTERNATE CONTRACT VERISON

Providian Prism Contracts are offered in two versions with differing charge
structures and features. THIS PROSPECTUS DESCRIBES ONLY THE PROVIDIAN PRISM A
UNIT CONTRACT. Also available is a standard Providian Prism Contract. Standard
contracts have no initial sales loads, but are subject to withdrawal or
surrender charges of up to 6% during the first 6 years. Standard contracts
also have increased annual mortality and expense risk charges of 1.25%. Other
differences apply to the General Account Guaranteed Options and annual
permitted additions. Standard Providian Prism contracts are offered only by
the appropriate Providian Prism prospectus. (Standard Providian Prism
contracts may occasionally be described as B Unit contracts in certain
marketing materials and trade publications and in the Statement of Additional
Information.) For full details regarding such contracts, please see the
applicable Providian Prism prospectus, which may be obtained from your agent
or by calling our Administrative Offices at 1-800-866-6007.

FEE TABLE

The following table illustrates all expenses (except for Premium Taxes that
may be assessed by your state) that you would incur as an owner of a Contract.
The purpose of this table is to assist you in understanding the various costs
and expenses that you would bear directly or indirectly as a purchaser of the
Contract. The fee table reflects all expenses for both the Separate Account
and the Portfolios. For a complete discussion of Contract costs and expenses,
including charges applicable to the General Account Guaranteed Options, see
"Charges and Deductions," page 14.

<TABLE>
<CAPTION>
FEE
AMOUNT
CONTRACTOWNER TRANSACTION EXPENSES ------
<S> <C>
Sales Load Imposed on Purchases (under $100,000)..................... 5.75%*
Contingent Deferred Sales Load (surrender charge).................... None
Exchange Fees........................................................ None
ANNUAL CONTRACT FEE.................................................. $ 30
<CAPTION>
SEPARATE ACCOUNT ANNUAL EXPENSES (as a percentage of assets in the
Separate Account)
<S> <C>
Mortality and Expense Risk Charge ................................... .65%
Administrative Charge................................................ .15%
----
Total Annual Separate Account Expenses............................... .80%**
</TABLE>

*A Unit Contract purchases of $100,000 or more will carry a reduced sales
load, see "Charges and Deductions," page 14.

**Separate Account Annual Expenses are not charged against the General Account
Guaranteed Options.

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PORTFOLIO ANNUAL EXPENSES

Except as indicated, the figures below are based on expenses for fiscal year
1995. In certain cases as indicated, the figures set forth below have been
restated to reflect anticipated expenses for fiscal year 1996. (The figures
state expenses as a percentage of each Portfolio's average net assets after
fee waivers and/or expense reimbursements, if applicable).

<TABLE>
<CAPTION>
TOTAL
MANAGEMENT PORTFOLIO
AND ADVISORY OTHER ANNUAL
EXPENSES EXPENSES EXPENSES
------------ -------- ---------
<S> <C> <C> <C>
Calvert Responsibly Invested Balanced
Portfolio*.................................... 0.70% 0.13% 0.83%
Calvert Responsibly Invested Capital
Accumulation Portfolio*....................... 0.90% 0.66% 1.56%
Calvert Responsibly Invested Money Market
Portfolio*.................................... 0.50% 0.16% 0.66%
Calvert Responsibly Invested Global Equity
Portfolio*.................................... 1.10% 0.08% 1.18%
Calvert Responsibly Invested Strategic Growth
Portfolio*.................................... 1.50% 0.52% 2.02%
Dreyfus Socially Responsible Growth
Portfolio**................................... 0.69% 0.58% 1.27%
</TABLE>
*For CRI Strategic Growth, CRI Capital Accumulation and CRI Global Equity,
the figures have been restated to reflect anticipated expenses for 1996 due
to expected reductions or eliminations of waivers for certain Management and
Advisory fees. Further, absent fee waivers and/or expense reimbursements for
these CRI portfolios, 1996 total portfolio expenses would be 2.22% for CRI
Strategic Growth, and 1.51% for CRI Global Equity, respectively. For CRI
Capital Accumulation, the Management and Advisory Fees are subject to a
performance adjustment, after 1/31/97, which could cause the fee to be as
high as 0.95% or as low as 0.85%, depending on performance. For CRI Balanced,
the Management and Advisory Fees are subject to a performance adjustment,
after 7/1/96, which could cause the fee to be as high as 0.85% or as low as
0.55%, depending on performance.
**In 1995, the advisor for the Dreyfus Socially Responsible Growth Portfolio
waived fees and/or reimbursed expenses; if it had not done so, the 1995
expenses would have been 0.75% for Management and Advisory Expenses, 0.58%
for Other Expenses and 1.33% for Total Portfolio Annual Expenses.

The following example illustrates the expenses that you would incur on a
$1,000 Purchase Payment over various periods, assuming (1) a 5% annual rate of
return and (2) redemption at the end of each period.

<TABLE>
<CAPTION>
10
1 YEAR 3 YEARS 5 YEARS YEARS
------ ------- ------- -------
<S> <C> <C> <C> <C>
Calvert Responsibly Invested Money Market
Portfolio...................................... $73.32 $106.37 $141.44 $238.87
Calvert Responsibly Invested Balanced Portfolio. 74.93 111.30 149.80 256.28
Calvert Responsibly Invested Capital
Accumulation Portfolio......................... 81.84 132.19 184.87 327.55
Calvert Responsibly Invested Global Equity
Portfolio...................................... 78.25 121.38 166.77 291.15
Calvert Responsibly Invested Strategic Growth
Portfolio...................................... 86.17 145.12 206.30 369.65
Dreyfus Socially Responsible Growth Portfolio... 79.10 123.95 171.09 299.91
</TABLE>

The following example illustrates the expenses that you would incur on a
$1,000 Purchase Payment over various periods, assuming (1) a 5% annual rate of
return and (2) you do not surrender your Contract or you annuitize at the end
of each period.

The Annual Contract Fee is reflected in these examples as a percentage equal
to the total amount of fees collected during a calendar year divided by the
total average net assets of the Portfolios during the same calendar year. The
fee is assumed to remain the same in each year of the above periods. (With
respect to partial year periods, if any, in the examples, the Annual Contract
Fee is pro-rated to reflect only the applicable portion of the partial year
period). The Annual Contract Fee will be deducted on each Contract Anniversary
and upon surrender, on a pro rata basis, from each Subaccount. In some states,
the Company will deduct Premium Taxes as incurred by the Company.

8
<PAGE>

This example should not be considered a representation of past or future
expenses or performance. Actual expenses may be higher or lower than those
shown, subject to the guarantees in the Contract.

CONDENSED FINANCIAL INFORMATION

(FOR THE PERIOD JANUARY 1, 1995 THROUGH DECEMBER 31, 1995)

<TABLE>
<CAPTION>
CRI CRI CRI CRI CRI DREYFUS
MONEY BALANCED**, CRI CRI CAPITAL GLOBAL STRATEGIC SOCIALLY
MARKET *** EQUITY*** BOND*** ACCUM.*** EQUITY GROWTH RESPONSIBLE
------- ----------- --------- ------- --------- ------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Accumulation unit value
as of:
Start Date*........... 10.000 10.000 10.000 10.000 10.000 10.000 10.000 10.000
12/31/92.............. 10.069 10.340 11.045 10.107 11.034 9.701 N/A N/A
12/31/93.............. 10.290 11.082 11.455 10.961 11.779 12.381 N/A N/A
12/31/94.............. 10.615 10.639 10.276 10.499 10.546 12.020 N/A N/A
12/31/95.............. 11.098 13.697 12.388 12.071 14.563 13.397 10.885 12.846
Number of units
outstanding as of:
12/31/92.............. 97,858 5,189 979 3,761 17,950 5,601 N/A N/A
12/31/93.............. 225,324 64,342 31,875 30,694 102,840 101,512 N/A N/A
12/31/94.............. 144,758 112,452 70,879 18,382 140,181 182,969 N/A N/A
12/31/95.............. 184,550 122,971 76,585 34,775 132,567 200,882 24,998 7,956
</TABLE>

*The date of commencement of operations for the Calvert Responsibly Invested
Balanced, Capital Accumulation and Money Market Portfolios was 9/28/92, for
the Calvert Responsibly Invested Bond and Global Portfolios was 10/01/92,
for the Calvert Responsibly Invested Equity Portfolio was 10/07/92, and for
the Calvert Responsibly Invested Strategic Growth and Dreyfus Socially
Responsible Growth Portfolios was 3/15/95.
**On 5/1/95, the name of the Calvert Responsibly Invested Managed Growth
Portfolio was changed to the Calvert Responsibly Invested Balanced
Portfolio.
***On 2/28/96 the Calvert Responsibly Invested Bond and Equity Portfolios were
merged into the Calvert Responsibly Invested Balanced and Capital
Accumulation Portfolios, respectively.

FINANCIAL STATEMENTS

Certain audited statutory basis financial statements of the Company and the
financial statements of the Separate Account (as well as the Independent
Auditors' Reports thereon) are contained in the Statement of Additional
Information.

PERFORMANCE MEASURES

Performance for the Subaccounts of the Separate Account, including the yield
and effective yield of the CRI Money Market Subaccount, the yield of the other
Subaccounts, and the total return of all Subaccounts may appear in reports and
promotional literature to current or prospective Contract Owners.

Please refer to the discussion below and to the Statement of Additional
Information for a more detailed description of the method used to calculate a
Portfolio's yield and total return, and a list of the indexes and other
benchmarks used in evaluating a Portfolio's performance.

STANDARDIZED AVERAGE ANNUAL TOTAL RETURN

When advertising performance of the Subaccounts, the Company will show the
Standardized Average Annual Total Return for a Subaccount which, as prescribed
by the rules of the Securities and Exchange Commission (the "SEC"), is the
effective annual compounded rate of return that would have produced the cash
redemption value over the stated period had the performance remained constant
throughout. The Standardized Average Annual Total Return assumes a single
$1,000 payment made at the beginning of the period and full redemption at the
end of the period. It reflects the deduction of all applicable sales loads,
the Annual Contract Fee and all other Portfolio, Separate Account and Contract
level charges except Premium Taxes, if any.

9
<PAGE>

ADDITIONAL PERFORMANCE MEASURES

NON-STANDARDIZED ACTUAL TOTAL RETURN AND NON-STANDARDIZED ACTUAL AVERAGE
ANNUAL TOTAL RETURN

The Company may show actual Total Return (i.e., the percentage change in the
value of an Accumulation Unit) for one or more Subaccounts with respect to one
or more periods, including Total Return Year-to-Date ("YTD") with respect to
certain periods. The Company may also show actual Average Annual Total Return
(i.e., the average annual change in Accumulation Unit Values) with respect to
one or more periods. For one year, the actual Total Return and the actual
Average Annual Total Return are effective annual rates of return and are
equal. For periods greater than one year, the actual Average Annual Total
Return is the effective annual compounded rate of return for the periods
stated. Because the value of an Accumulation Unit reflects the Separate
Account and Portfolio expenses (see "Fee Table"), the actual Total Return and
actual Average Annual Total Return also reflect these expenses. These
percentages do not reflect the Annual Contract Fee, any sales loads or Premium
Taxes (if any) which, if included, would reduce the percentages reported.

NON-STANDARDIZED HYPOTHETICAL TOTAL RETURN AND NON-STANDARDIZED HYPOTHETICAL
AVERAGE ANNUAL TOTAL RETURN

The Company may show Non-Standardized Hypothetical Total Return and Non-
Standardized Hypothetical Average Annual Total Return, calculated on the basis
of the historical performance of the Portfolios, and may assume the Contract
was in existence prior to its inception date (which it was not). After the
Contract's inception date, the calculations will reflect actual Accumulation
Unit Values. These returns are based on specified premium patterns which
produce the resulting Accumulated Values. They reflect a deduction for the
Separate Account expenses and Portfolio expenses. These returns do not include
the Annual Contract Fee, any sales loads or Premium Taxes (if any) which, if
included, would reduce the percentages reported.

The Non-Standardized Annual Total Return for a Subaccount is the effective
annual rate of return that would have produced the ending Accumulated Value of
the stated one-year period.

The Non-Standardized Average Annual Total Return for a Subaccount is the
effective annual compounded rate of return that would have produced the ending
Accumulated Value over the stated period had the performance remained constant
throughout.

YIELD AND EFFECTIVE YIELD

The Company may also show yield and effective yield figures for the Subaccount
investing in shares of CRI Money Market. "Yield" refers to the income
generated by an investment in CRI Money Market over a seven-day period, which
is then "annualized." That is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-
week period and is shown as a percentage of the investment. The "effective
yield" is calculated similarly but, when annualized, the income earned by an
investment in CRI Money Market is assumed to be reinvested. Therefore the
effective yield will be slightly higher than the yield because of the
compounding effect of this assumed reinvestment. These figures do not reflect
the Annual Contract Fee, any sales loads or Premium Taxes (if any) which, if
included, would reduce the yields reported.

From time to time a Portfolio of a Fund may advertise its yield and total
return investment performance. For each Subaccount other than CRI Money Market
for which the Company advertises yield, the Company shall furnish a yield
quotation referring to the Portfolio computed in the following manner: the net
investment income per Accumulation Unit earned during a recent one month
period is divided by the Accumulation Unit Value on the last day of the
period.

Please refer to the Statement of Additional Information for a description of
the method used to calculate a Portfolio's yield and total return, and a list
of the indexes and other benchmarks used in evaluating a Portfolio's
performance.

The performance measures discussed above reflect results of the Portfolios and
are not intended to indicate or predict future performance. For more detailed
information, see the Statement of Additional Information.

Performance information for the Subaccounts may be contrasted with other
comparable variable annuity separate accounts or other investment products
surveyed by Lipper Analytical Services, a nationally recognized independent
reporting service which ranks mutual funds and other investment companies by
overall performance, investment objectives and assets. Performance may also be
tracked by other ratings services, companies, publications or persons who rank
separate accounts or other investment products on overall performance or other
criteria. Performance figures will be calculated in accordance with
standardized methods established by each reporting service.

10
<PAGE>

THE COMPANY AND THE SEPARATE ACCOUNT

PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY

The Company is a stock life insurance company incorporated under the laws of
Missouri on August 6, 1920. The Company is principally engaged in offering
life insurance, annuity contracts, and accident and health insurance and is
admitted to do business in 49 states, the District of Columbia and Puerto
Rico. The Company is wholly-owned by Providian Corporation, a publicly-held
diversified consumer financial services company whose shares are traded on the
New York Stock Exchange with assets of $26.8 billion as of December 31, 1995.

PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY SEPARATE ACCOUNT V

The Separate Account was established by the Company as a separate account
under the laws of the State of Missouri on February 14, 1992, pursuant to a
resolution of the Company's Board of Directors. The Separate Account is a unit
investment trust registered with the SEC under the Investment Company Act of
1940 (the "1940 Act"). Such registration does not signify that the SEC
supervises the management or the investment practices or policies of the
Separate Account. The Separate Account meets the definition of a "separate
account" under the federal securities laws.

The assets of the Separate Account are owned by the Company and the
obligations under the Contract are obligations of the Company. These assets
are held separately from the other assets of the Company and are not
chargeable with liabilities incurred in any other business operation of the
Company (except to the extent that assets in the Separate Account exceed the
reserves and other liabilities of the Separate Account). Income, gains and
losses incurred on the assets in the Separate Account, whether or not
realized, are credited to or charged against the Separate Account without
regard to other income, gains or losses of the Company. Therefore, the
investment performance of the Separate Account is entirely independent of the
investment performance of the General Account assets or any other separate
account maintained by the Company.

The Separate Account has dedicated six Subaccounts to the Contract, each of
which invests solely in a corresponding Portfolio of the Funds. Additional
Subaccounts may be established at the discretion of the Company.

ACACIA CAPITAL CORPORATION

Acacia Capital Corporation is incorporated in Maryland and is an open-end
management investment company registered under the 1940 Act. This Fund
consists of several investment portfolios, including the Portfolios available
as part of the Providian PRISM Variable Annuity which are designed to provide
opportunities for investing in enterprises that make a significant
contribution to society through their products and services and the way they
do business.

CALVERT GROUP, LTD.

Calvert Group, Ltd. is the sponsor of the Acacia Capital Corporation Fund and
is a subsidiary of Acacia Mutual Life Insurance Company of Washington, D.C.
Calvert Group, Ltd. is one of the largest investment management firms in the
Washington, D.C. area. As of December 31, 1995, Calvert Group, Ltd. managed
and administered assets in excess of $4.8 billion and more than 200,000
shareholder and depositor accounts.

THE DREYFUS SOCIALLY RESPONSIBLE GROWTH FUND, INC.

The Dreyfus Socially Responsible Growth Fund, Inc. is an open-end,
diversified, management investment company, of the type commonly referred to
as a mutual fund, that is intended to serve as a funding vehicle for variable
annuity contracts and variable life insurance policies to be offered by the
separate accounts of various life insurance companies. This Fund was
incorporated under Maryland law on July 20, 1992, and commenced operations on
October 7, 1993. The Dreyfus Corporation serves as this Fund's investment
adviser. NCM Capital Management Group, Inc. serves as this Fund's investment
sub-adviser and provides day-to-day management of this Fund's assets.

THE PORTFOLIOS (SEE ACCOMPANYING PROSPECTUSES)

For more information concerning the risks associated with each Portfolio's
investments, please refer to the applicable underlying Fund Prospectus.

11
<PAGE>

THE CALVERT RESPONSIBLY INVESTED MONEY MARKET PORTFOLIO ("CRI MONEY MARKET")

This Portfolio seeks to provide the highest level of current income consistent
with liquidity, safety and security of capital, by investing in money market
instruments, including repurchase agreements with recognized securities
dealers and banks secured by such instruments, selected in accordance with the
Portfolio's investment and social criteria. CRI Money Market attempts to
maintain, but cannot assure, a constant net asset value of $1.00 per share.

THE CALVERT RESPONSIBLY INVESTED BALANCED PORTFOLIO ("CRI BALANCED")

CRI Balanced seeks to achieve a total return above the rate of inflation
through an actively managed portfolio of stocks, bonds and money market
instruments selected with a concern for the investment and social impact of
each investment. Prior to May 1, 1995, the CRI Balanced Portfolio was called
the CRI Managed Growth Portfolio. Effective February 28, 1996 the former CRI
Bond Portfolio was merged into the CRI Balanced Portfolio.

THE CALVERT RESPONSIBLY INVESTED CAPITAL ACCUMULATION PORTFOLIO ("CRI CAPITAL
ACCUMULATION")

CRI Capital Accumulation seeks to provide long-term capital appreciation by
investing primarily in a nondiversified portfolio of the equity securities of
small- to mid-sized companies that are undervalued but which demonstrate a
potential for growth. The Portfolio will rely on its proprietary research to
identify stocks that may have been overlooked by analysts, investors, and the
media, and which generally have a market value of between $100 million and $5
billion, but which may be larger or smaller as deemed appropriate. Effective
February 28, 1996 the former CRI Equity Portfolio was merged into the CRI
Capital Accumulation Portfolio.

THE CALVERT RESPONSIBLY INVESTED GLOBAL EQUITY PORTFOLIO ("CRI GLOBAL EQUITY")

CRI Global Equity seeks to provide long-term growth of capital by investing
primarily in the common stocks and other equity securities of companies around
the world. Investments are generally broadly diversified by industry as well
as by region. The Portfolio will invest in U.S. and international concerns
with significant financial potential and which are believed to have the most
positive impact on our global society.

THE CALVERT RESPONSIBLY INVESTED STRATEGIC GROWTH PORTFOLIO ("CRI STRATEGIC
GROWTH")

CRI Strategic Growth seeks maximum long-term growth primarily through
investment in equity securities of companies that have little or no debt, high
relative strength and substantial management ownership. This Portfolio invests
primarily in common stocks or securities convertible into common stocks. CRI
Strategic Growth considers issuers of all sizes, industries, and geographic
markets, and does not seek interest income or dividends. The Portfolio invests
primarily in common stocks traded in the U.S. securities markets, including
American Depository Receipts (ADRs). While this Portfolio does not presently
invest in foreign securities, it may do so in the future.

THE DREYFUS SOCIALLY RESPONSIBLE GROWTH FUND, INC. ("DREYFUS SOCIALLY
RESPONSIBLE GROWTH")

Dreyfus Socially Responsible Growth seeks to provide capital growth through
equity investment in companies that, in the opinion of management, not only
meet traditional investment standards but which also show evidence that they
conduct their business in a manner that contributes to the enhancement of the
quality of life in America. Current income is secondary to this primary goal.

OTHER PORTFOLIO INFORMATION

There is no assurance that a Portfolio will achieve its stated investment
objective.

Additional information concerning the investment objectives and policies of
the Portfolios and the investment advisory services, total expenses and
charges can be found in the current Prospectus for each Fund. THE FUNDS' OR
PORTFOLIOS' PROSPECTUSES SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
CONCERNING THE ALLOCATION OF NET PURCHASE PAYMENTS TO A PORTFOLIO.

The Portfolios may be made available to registered separate accounts offering
variable annuity and variable life products of the Company as well as other
insurance companies or to a person or plan, including a pension or retirement
plan receiving favorable tax treatment under the Code, that qualifies to
purchase shares of the Funds under Section 817(h) of the Code. Although we
believe it is unlikely, a material conflict could arise between the interests
of the Separate Account and one or more of the other participating separate
accounts and other qualified persons or plans. In the event of a material
conflict, the affected insurance companies agree to take any necessary steps,
including removing their separate accounts from the Funds if required by law,
to resolve the matter.

12
<PAGE>

CONTRACT FEATURES

The rights and benefits under the Contract are as described below and in the
Contract. The Company reserves the right to make any modification to conform
the Contract to, or give the Contract Owner the benefit of, any federal or
state statute or any rule or regulation of the United States Treasury
Department.

RIGHT TO CANCEL PERIOD

A Right to Cancel Period exists for a minimum of 10 days after you receive the
Contract (30 or more days in some instances as set forth in your Contract),
plus a 5 day grace period to allow for mail delivery. The Contract permits you
to cancel the Contract during the Right to Cancel Period by returning the
Contract to our Administrative Offices, P.O. Box 32700, Louisville, Kentucky
40232, or to the agent from whom you purchased the Contract. Upon
cancellation, the Contract is treated as void from the Contract Date and when
we receive the Contract, (1) if the state of issue of your Contract is CA, GA,
ID, LA, MI, MO, NE, NH, NC, OK, OR, SC, UT, VA or WV, then for any amount of
your initial Purchase Payment(s) invested in CRI Money Market, we will return
the Accumulated Value of your Purchase Payment(s) so invested, or if greater,
the amount of your Purchase Payment(s) so invested, (2) for any amount of your
initial Purchase Payment(s) invested in the Portfolios immediately following
receipt by us, we will return the Accumulated Value of your Purchase
Payment(s) so invested plus any loads, fees and/or Premium Taxes that may have
been subtracted from such amount, and (3) for any amount of your initial
Purchase Payment(s) invested in the Guaranteed Index Rate Options immediately
following receipt by us, we will refund the amount of your Purchase Payment(s)
so invested.

CONTRACT PURCHASE AND PURCHASE PAYMENTS

If you wish to purchase a Contract, you should consult your agent who will
provide the necessary information to us in a customer order form and forward
the initial Purchase Payment to such address as the Company may from time to
time designate. If you wish to make personal delivery by hand or courier to
the Company of your initial purchase payment (rather than through the mail),
you must do so at our Administrative Offices, 400 West Market Street,
Louisville, KY 40202. The initial Purchase Payment for a Non-Qualified
Contract must be equal to or greater than the $5,000 minimum investment
requirement. The initial Purchase Payment for a Qualified Contract must be
equal to or greater than $2,000 (or a payment schedule of $50 a month by
payroll deduction must be established).

The Contract will be issued and the initial Purchase Payment less any sales
load or Premium Taxes will be credited within two Business Days after receipt
of the customer order form and the initial Purchase Payment in good order. The
Company reserves the right to reject any customer order form or initial
Purchase Payment. Following issuance, the Contract will be mailed to you along
with a Contract acknowledgement form which you should complete, sign and
return in accordance with its specifications. Please note that until the
Company receives the acknowledgement form signed by the Owner and any Joint
Owner, the Owner and any Joint Owner must obtain a signature guarantee on
their written, signed request in order to exercise any rights under the
Contract.

If the initial Purchase Payment cannot be credited because the application is
incomplete, we will contact you, explain the reason for the delay and will
refund the initial Purchase Payment within five Business Days, unless you
instruct us to retain the initial Purchase Payment and credit it as soon as
the necessary requirements are fulfilled.

Additional Purchase Payments may be made at any time prior to the Annuity
Date, as long as the Annuitant is living. Additional Purchase Payments must be
for at least $500 for Non-Qualified Contracts, or $50 for Qualified Contracts.
Additional Purchase Payments received prior to the close of the New York Stock
Exchange (generally 4:00 P.M. Eastern time) are credited to the Accumulated
Value at the close of business that same day. Additional Purchase Payments
received after the close of the New York Stock Exchange are processed the next
Business Day.

Total Purchase Payments may not exceed $1,000,000 without our prior approval.

13
<PAGE>

PURCHASING BY WIRE

For wiring instructions please contact our Administrative Offices at 1-800-
866-6007.

ALLOCATION OF PURCHASE PAYMENTS

You instruct your agent how your Net Purchase Payments will be allocated. You
may allocate each Net Purchase Payment to one or more of the Portfolios or the
General Account Guaranteed Options as long as such portions are whole number
percentages, provided that each allocation to a General Account Guaranteed
Option is at least $1,000 and that no Portfolio or General Account Guaranteed
Option may contain a positive balance less than $250 or $1,000, respectively.
You may choose to allocate nothing to a particular Portfolio. You may change
allocation instructions for future Net Purchase Payments by sending us the
appropriate Company form or by following other designated Company procedures.
The General Account Guaranteed Options are available for sale in most, but not
all, states.

If the state of issue of your Contract is CA, GA, ID, LA, MI, MO, NE, NH, NC,
OK, OR, SC, UT, VA or WV, then your initial Net Purchase Payment(s) will, when
your Contract is issued, be invested in CRI Money Market until the expiration
of the Right to Cancel Period of 10 to 30 days (plus a five day grace period
to allow for mail delivery) or more in some instances as specified in your
Contract after the issuance of your Contract and then invested according to
your initial allocation instructions, provided that you may elect to have the
portion of your initial Net Purchase Payment(s) allocated to the Guaranteed
Index Rate Options invested immediately upon our receipt thereof in order to
lock in the rates then applicable to such options. Notwithstanding, the
foregoing, any interest accrued on amounts held in the CRI Money Market during
the Right to Cancel Period will remain in the CRI Money Market upon expiration
of the Right to Cancel Period if it is not selected as an initial allocation
option.

If the state of issue of your Contract is any other state, your initial Net
Purchase Payment(s) will, unless you indicate otherwise, be invested in your
Portfolios and Guaranteed Index Rate Options immediately upon our receipt
thereof, IN WHICH CASE YOU WILL BEAR FULL INVESTMENT RISK FOR ANY AMOUNTS
ALLOCATED TO THE PORTFOLIOS DURING THE RIGHT TO CANCEL PERIOD. (Please note
that this immediate investment is not available with respect to any amounts
allocated to THE FIVE-YEAR GUARANTEED EQUITY OPTION WHICH IS ILLIQUID FOR FIVE
YEARS.)

CHARGES AND DEDUCTIONS

There are no withdrawal or surrender charges for Contacts (although certain
charges or restrictions may apply to your Contract's General Account
Guaranteed Options). For Contracts, the following percentages of each Purchase
Payment are deducted as a sales load:

<TABLE>
<CAPTION>
AGGREGATED PURCHASE PAYMENTS SALES LOAD
---------------------------- ----------
<S> <C>
$0-$99,999.................................. 5.75%
$100,000-$249,999........................... 4.75%
$250,000-$499,999........................... 3.75%
$500,000-$999,999........................... 2.75%
$1 Million +................................ 1.75%
</TABLE>

These Purchase Payment breakpoints will be applied on an aggregated basis, so
that all prior Purchase Payments will be added to the amount of any additional
Purchase Payment before the breakpoint calculation is made. (Example: An
$80,000 Purchase Payment is initially received. An additional Purchase Payment
of $40,000 is made the following year, bringing the aggregate amount of
Purchase Payments to $120,000. A sales load of 4.75% will apply to the entire
$40,000 Purchase Payment.) Growth in your Accumulated Value is not added into
this calculation, and partial withdrawals are not subtracted from this
calculation.

MORTALITY AND EXPENSE RISK CHARGE

We impose a charge as compensation for bearing certain mortality and expense
risks under the Contracts. The annual charge is assessed daily based on the
net asset value of the Separate Account. The annual mortality and expense risk
charge is .65% of the net asset value of the Separate Account.

We guarantee that this annual charge will never increase. If this charge is
insufficient to cover actual costs and assumed risks, the loss will fall on
us. Conversely, if the charge proves more than sufficient, any excess will be
added to the Company surplus and will be used for any lawful purpose,
including any shortfall on the costs of distributing the Contracts.

14
<PAGE>

The mortality risk borne by us under the Contracts, where one of the life
Annuity Payment Options is selected, is to make monthly Annuity Payments
(determined in accordance with the annuity tables and other provisions
contained in the Contract) regardless of how long all Annuitants may live. We
also assume mortality risk as a result of our guarantee of a Death Benefit in
the event the Annuitant dies prior to the Annuity Date.

The expense risk borne by us under the Contracts is the risk that the charges
for administrative expenses which are guaranteed for the life of the Contract
may be insufficient to cover the actual costs of issuing and administering the
Contract.

ADMINISTRATIVE CHARGE AND ANNUAL CONTRACT FEE

An administrative charge equal to .15% annually of the net asset value of the
Separate Account is assessed daily along with the Annual Contract Fee of $30.
The Annual Contract Fee is deducted proportionately from the Subaccounts. For
any Contract with amounts allocated to the Subaccounts, the $30 fee is
assessed per Contract, not per Portfolio chosen. The Annual Contract Fee will
be deducted on each Contract Anniversary and upon surrender, on a pro rata
basis, from each Subaccount. These deductions represent reimbursement for the
costs expected to be incurred over the life of the Contract for issuing and
maintaining each Contract and the Separate Account.

EXCHANGES

Each Contract Year you may make an unlimited number of free Exchanges between
Portfolios and/or General Account Guaranteed Options, provided that after an
Exchange no Portfolio or General Account Guaranteed Option may contain a
positive balance less than $250 or $1,000, respectively. We reserve the right
to charge a $15 fee in the future for Exchanges in excess of 12 per Contract
Year.

EXCEPTIONS TO CHARGES AND TO TRANSACTION OR BALANCE REQUIREMENTS

The sales load or other administrative charges or fees may be reduced for
sales of Contracts to a trustee, employer or similar entity representing a
group where the Company determines that such sales result in savings of sales
and/or administrative expenses. In addition, directors, officers and bona fide
full-time employees (and their spouses and minor children) of the Company, its
ultimate parent company, Providian Corporation and certain of their
affiliates, and the Calvert Group, Ltd., its wholly-owned affiliates and
certain sales representatives for the Contract are permitted to purchase
Contracts with substantial reduction of the sales load, contingent deferred
sales load or other administrative charges or fees or with a waiver or
modification of certain minimum or maximum purchase and transaction amounts or
balance requirements. Contracts so purchased are for investment purposes only
and may not be resold except to the Company.

In no event will reduction or elimination of the sales load, contingent
deferred sales loads or other fees or charges or waiver or modification of
transaction or balance requirements be permitted where such reduction,
elimination, waiver or modification will be unfairly discriminatory to any
person. Additional information about reductions in charges is contained in the
Statement of Additional Information.

TAXES

We will, where such taxes are imposed on the Company by state law, deduct
Premium Taxes that currently range up to 3.5%. These taxes will be deducted
from the Accumulated Value or Purchase Payments in accordance with applicable
law.

At the time of the filing of this Prospectus, the following state assesses a
Premium Tax on all initial and additional Purchase Payments on Non-Qualified
Contracts:

<TABLE>
<CAPTION>
QUALIFIED NON-QUALIFIED
--------- -------------
<S> <C> <C>
South Dakota.................. 0% 1.25%
</TABLE>

In addition, a number of states currently imposes Premium Taxes at the time an
Annuity Payment Option (other than a Lump Sum Payment Option) is selected. At
the time of the filing of this Prospectus, the following states assess a
Premium Tax against the Accumulated Value if the Contract Owner chooses an
Annuity Payment Option instead of receiving a lump sum distribution:

15
<PAGE>

<TABLE>
<CAPTION>
QUALIFIED NON-QUALIFIED
--------- -------------
<S> <C> <C>
California.................... .50% 2.35%
District of Columbia.......... 2.25% 2.25%
Kansas........................ 0% 2.00%
Kentucky...................... 2.00% 2.00%
Maine......................... 0% 2.00%
Nevada........................ 0% 3.50%
West Virginia................. 1.00% 1.00%
Wyoming....................... 0% 1.00%
</TABLE>

Under present laws, the Company will incur state or local taxes (in addition
to the Premium Taxes described above) in several states. At present, the
Company does not charge the Contract Owner for these taxes. If there is a
change in state or local tax laws, charges for such taxes may be made. The
Company does not expect to incur any federal income tax liability attributable
to investment income or capital gains retained as part of the reserves under
the Contracts. (See "Federal Tax Considerations," page 21.) Based upon these
expectations, no charge is currently being made to the Separate Account for
federal income taxes that may be attributable to the Separate Account.

The Company will periodically review the question of a charge to the Separate
Account for federal income taxes related to the Separate Account. Such a
charge may be made in future years for any federal income taxes incurred by
the Company. This might become necessary if the tax treatment of the Company
is ultimately determined to be other than what the Company currently believes
it to be, if there are changes made in the federal income tax treatment of
annuities at the corporate level, or if there is a change in the Company's tax
status. In the event that the Company should incur federal income taxes
attributable to investment income or capital gains retained as part of the
reserves under the Contracts, the Accumulated Value of the Contract would be
correspondingly adjusted by any provision of charge for such taxes.

PORTFOLIO EXPENSES

The value of the assets in the Separate Account reflect the fees and expenses
paid by the Portfolios. A complete description of these expenses is found in
the "Fee Table" section of this Prospectus and in the Funds' Prospectuses and
Statements of Additional Information.

ACCUMULATED VALUE

At the commencement of the Contract, the Accumulated Value equals the initial
Net Purchase Payment. Thereafter, the Accumulated Value equals the Accumulated
Value from the previous Business Day increased by: (i) any additional Net
Purchase Payments received by the Company and (ii) any increase in the
Accumulated Value due to investment results of the selected Portfolio(s) and
the interest credited to the General Account Guaranteed Options during the
Valuation Period; and reduced by: (i) any decrease in the Accumulated Value
due to investment results of the selected Portfolio(s), (ii) a daily charge to
cover the mortality and expense risks assumed by the Company, (iii) any charge
to cover the cost of administering the Contract, (iv) any partial withdrawals,
(v) any Market Value Adjustment or other deduction due to early Exchanges from
the Guaranteed Index Rate Options and (vi) any charges for any Exchanges made
after the first 12 in any Contract Year.

EXCHANGES AMONG THE PORTFOLIOS

Should your investment goals change, you may exchange Accumulated Value among
the Portfolios of the Funds and, as permitted, the General Account Guaranteed
Options. Requests for Exchanges, received by mail or by telephone, prior to
the close of the New York Stock Exchange (generally 4:00 P.M. Eastern time)
are processed at the close of business that same day. Requests received after
the close of the New York Stock Exchange are processed the next Business Day.
If you experience difficulty in making a telephone Exchange your Exchange
request may be made by regular or express mail. It will be processed on the
date received.

To take advantage of the privilege of initiating transactions by telephone,
you must first elect the privilege by completing the appropriate section of
the Contract acknowledgement form, which you will receive with your Contract.
You may also complete a separate telephone authorization form at a later date.
To take advantage of the privilege of authorizing a third party to initiate
transactions by telephone, you must first complete a third party authorization
form or the appropriate section of the Contract acknowledgement form.

16
<PAGE>

Neither the Company, the Funds nor Calvert Group, Ltd. is responsible for the
authenticity of Exchange instructions received by telephone. The Company will
undertake reasonable procedures to confirm that instructions communicated by
telephone are genuine. Prior to the acceptance of any request, the caller will
be asked by a customer service representative for his or her Contract number
and social security number and such other information as the Company deems
appropriate. All calls will be recorded, and this information will be verified
with the Contract Owner's records prior to processing a transaction.
Furthermore, all transactions performed by a customer service representative
will be verified with the Contract Owner through a written confirmation
statement. Neither the Company, the Funds nor Calvert shall be liable for any
loss, cost or expense for action on telephone instructions that are believed
to be genuine in accordance with these procedures. Every effort will be made
to maintain the Exchange privilege. However, the Company and the Funds reserve
the right to revise or terminate its provisions, limit the amount of or reject
any Exchange, as deemed necessary, at any time.

For information concerning Exchanges to and from the General Account
Guaranteed Options, See "The General Account," at Appendix A.

FULL AND PARTIAL WITHDRAWALS

At any time before the Annuity Date and while the Annuitant is living, you may
make a partial or full withdrawal of the Contract to receive all or part of
the Surrender Value by sending a written request to our Administrative
Offices. Full or partial withdrawals may only be made before the Annuity Date
and all partial withdrawal requests must be for at least $500. The amount
available for full or partial withdrawal is the Surrender Value at the end of
the Valuation Period during which the written request for withdrawal is
received. The Surrender Value is an amount equal to the Accumulated Value,
adjusted to reflect any applicable Market Value Adjustment for amounts
allocated to the Five-Year Guaranteed Index Rate Option, less any early
withdrawal charges for amounts allocated to the One-Year Guaranteed Index Rate
Option, less any amount allocated to the Five-Year Guaranteed Equity Option,
less any Premium Tax incurred but not yet deducted. The withdrawal amount may
be paid in a lump sum to you, or if elected, all or any part may be paid out
under an Annuity Payment Option. (See "Annuity Payment Options," page 20).

You can make a withdrawal by sending the appropriate Company form to our
Administrative Offices. You may not make any full or partial withdrawals from
the Five-Year Guaranteed Equity Option before the end of the five-year
guarantee period. Your proceeds will normally be processed and mailed to you
within two Business Days after the receipt of the request but in no event will
it be later than seven calendar days, subject to postponement in certain
circumstances. (See "Deferment of Payment," page 21).

Payments under the Contract of any amounts derived from premiums paid by check
may be delayed until such time as the check has cleared your bank. If, at the
time the Contract Owner requests a full or partial withdrawal, he has not
provided the Company with a written election not to have federal income taxes
withheld, the Company must by law withhold such taxes from the taxable portion
of any full or partial withdrawal and remit that amount to the federal
government. Moreover, the Code provides that a 10% penalty tax may be imposed
on certain early withdrawals. (See "Federal Tax Considerations," page 21.)

Since the Contract Owner assumes the investment risk with respect to amounts
allocated to the Separate Account, the total amount paid upon withdrawal of
the Contract (taking into account any prior withdrawals) may be more or less
than the total Net Purchase Payments made.

SYSTEMATIC WITHDRAWAL OPTION

You may choose to have a specified dollar amount provided to you on a regular
basis from the portion of your Contract's Accumulated Value that is allocated
to the Portfolios. By electing the Systematic Withdrawal Option, withdrawals
may be made on a monthly, quarterly, semi-annual or annual basis. The minimum
amount for each withdrawal is $250.

This option may be elected by completing the Systematic Withdrawal Request
Form. This form must be received by us at least 30 days prior to the date
systematic withdrawals will begin. Each withdrawal will be processed on the
day and at the frequency indicated on the Systematic Withdrawal Request Form.
The start date for the systematic withdrawals must be between the first and
twenty-eighth day of the month. You may discontinue the Systematic Withdrawal
Option at any time by notifying us in writing at least 30 days prior to your
next scheduled withdrawal date.

17
<PAGE>

Each systematic withdrawal is subject to federal income taxes on the taxable
portion, and may be subject to a 10% federal penalty tax if you are under age
59 1/2. You may elect to have federal income taxes withheld from each
withdrawal at a 10% rate on the Systematic Withdrawal Request Form. For a
discussion of the tax consequences of withdrawals, see "Federal Tax
Considerations" on page 21 of the Prospectus. You may wish to consult a tax
adviser regarding any tax consequences that might result prior to electing the
Systematic Withdrawal Option.

We reserve the right to discontinue offering the Systematic Withdrawal Option
upon 30 days written notice. We also reserve the right to charge a fee for
such service.

DOLLAR COST AVERAGING OPTION

If you have at least $5,000 of Accumulated Value in the CRI Money Market, you
may choose to have a specified dollar amount transferred from this Portfolio
to other Portfolios in the Separate Account or to the General Account
Guaranteed Options on a monthly basis. The main objective of Dollar Cost
Averaging is to shield your investment from short term price fluctuations.
Since the same dollar amount is transferred to other Portfolios each month,
more units are purchased in a Portfolio if the value per unit is low and less
units are purchased if the value per unit is high. Therefore, a lower average
cost per unit may be achieved over the long term. This plan of investing
allows investors to take advantage of market fluctuations but does not assure
a profit or protect against a loss in declining markets.

This Dollar Cost Averaging Option may be elected on the customer order form or
at a later date. The minimum amount that may be transferred each month into
any Portfolio or General Account Guaranteed Option is $250. The maximum amount
which may be transferred is equal to the Accumulated Value in the CRI Money
Market when elected, divided by 12.

The transfer date will be the same calendar day each month as the Contract
Date. The dollar amount will be allocated to the Portfolios in the proportions
you specify on the appropriate Company form, or, if none are specified, in
accordance with your original investment allocation. If, on any transfer date,
the Accumulated Value is equal to or less than the amount you have elected to
have transferred, the entire amount will be transferred and the option will
end. You may change the transfer amount once each Contract Year, or cancel
this option by sending the appropriate Company form to our Administrative
Offices which must be received at least seven days before the next transfer
date.

IRS-REQUIRED DISTRIBUTIONS

Prior to the Annuity Date, if you or, if applicable, a Joint Owner dies before
the entire interest in the Contract is distributed, the value of the Contract
must be distributed to the Owner's Designated Beneficiary (unless the Contract
Owner was also the Annuitant--in which case the Annuitant's Beneficiary is
entitled to the Death Benefit) as described in this section so that the
Contract qualifies as an annuity under the Code.

If the death occurs on or after the Annuity Date, the remaining portions of
such interest will be distributed at least as rapidly as under the method of
distribution being used as of the date of death. If the death occurs before
the Annuity Date, the entire interest in the Contract will be distributed
within five years after date of death or be paid under an Annuity Payment
Option under which payments will begin within one year of the Contract Owner's
death and will be made for the life of the Owner's Designated Beneficiary or
for a period not extending beyond the life expectancy of that beneficiary. The
Owner's Designated Beneficiary is the person to whom ownership of the Contract
passes by reason of death.

If any portion of the Contract Owner's interest is payable to (or for the
benefit of) the surviving spouse of the Contract Owner, the Contract may be
continued with the surviving spouse as the new Contract Owner.

MINIMUM BALANCE REQUIREMENT

We will transfer the balance in any Portfolio that falls below $250 (or $1,000
in the case of any General Account Guaranteed Option balance), due to a
partial withdrawal or Exchange, to the remaining Portfolios held under that
Contract on a pro rata basis. In the event that the entire value of the
Contract falls below $1,000, you may be notified that the Accumulated Value of
your account is below the Contract's minimum requirement. You would then be
allowed 60 days to make an additional investment before the account is
liquidated. Proceeds would be promptly paid to the Contract Owner. The full
proceeds would be taxable as a withdrawal. We will not exercise this right
with respect to Qualified Contracts.

18
<PAGE>

DESIGNATION OF AN ANNUITANT'S BENEFICIARY

The Contract Owner may select one or more Annuitant's Beneficiaries and name
them in the customer order form. Thereafter, while the Annuitant is living,
the Contract Owner may change the Annuitant's Beneficiary by sending us the
appropriate Company form. Such change will take effect on the date such form
is signed by the Contract Owner but will not affect any payment made or other
action taken before the Company acknowledges such form. You may also make the
designation of Annuitant's Beneficiary irrevocable by sending us the
appropriate Company form and obtaining approval from the Company. Changes in
the Annuitant's Beneficiary may then be made only with the consent of the
designated irrevocable Annuitant's Beneficiary.

If the Annuitant dies prior to the Annuity Date, the following will apply
unless the Contract Owner has made other provisions:

(a) If there is more than one Annuitant's Beneficiary, each will share in the
Death Benefits equally;

(b) If one or two or more Annuitant's Beneficiaries have already died, that
share of the Death Benefit will be paid equally to the survivor(s);

(d) If an Annuitant's Beneficiary dies at the same time as the Annuitant, the
proceeds will be paid as though the Annuitant's Beneficiary had died
first. If an Annuitant's Beneficiary dies within 15 days after the
Annuitant's death and before the Company receives due proof of the
Annuitant's death, proceeds will be paid as though the Annuitant's
Beneficiary had died first.

If an Annuitant's Beneficiary who is receiving Annuity Payments dies, any
remaining payments certain will be paid to that Annuitant's Beneficiary's
named beneficiary(ies) when due. If no Annuitant's Beneficiary survives the
Annuitant, the right to any amount payable will pass to the Contract Owner. If
the Contract Owner is the Annuitant, this right will pass to his or her
estate. If a Life Annuity with Period Certain option was elected, and if the
Annuitant dies on or after the Annuity Date, any unpaid payments certain will
be paid to the Annuitant's Beneficiary or your designated Payee.

DEATH OF ANNUITANT PRIOR TO ANNUITY DATE

If the Annuitant dies prior to the Annuity Date, an amount will be paid as
proceeds to the Annuitant's Beneficiary. The Death Benefit is calculated and
is payable upon receipt of due Proof of Death of the Annuitant as well as
proof that the Annuitant died prior to the Annuity Date. Upon receipt of this
proof, the Death Benefit will be paid within seven days, or as soon thereafter
as the Company has sufficient information about the Annuitant's Beneficiary to
make the payment. The Annuitant's Beneficiary may receive the amount payable
in a lump sum cash benefit or under one of the Annuity Payment Options.

The Death Benefit is the greater of:

(1) The Accumulated Value on the date we receive due Proof of Death; or

(2) The Adjusted Death Benefit.

During the first six Contract Years, the Adjusted Death Benefit will be the
sum of all Net Purchase Payments made, less any partial withdrawals taken.
During each subsequent six-year period, the Adjusted Death Benefit will be the
Death Benefit on the last day of the previous six-year period plus any Net
Purchase Payments made, less any partial withdrawals taken during the current
six-year period. After the Annuitant attains age 75, the Adjusted Death
Benefit will remain equal to the Death Benefit on the last day of the six-year
period before age 75 occurs plus any Net Purchase Payments subsequently made,
less any partial withdrawals subsequently taken.

ANNUITY DATE

You may specify an Annuity Date, which can be no later than the first day of
the month after the Annuitant's 85th birthday, without the Company's prior
approval. The Annuity Date is the date that Annuity Payments are scheduled to
commence under the Contract unless the Contract has been surrendered or an
amount has been paid as proceeds to the designated Annuitant's Beneficiary
prior to that date.

You may advance or defer the Annuity Date. However, the Annuity Date may not
be advanced to a date prior to 30 days after the date of receipt of a written
request or, without the Company's prior approval, deferred to a date beyond
the first day of the month after the Annuitant's 85th birthday. The Annuity
Date may only be changed by written request during the Annuitant's lifetime
and must be made at least 30 days before the then-scheduled Annuity Date. The
Annuity Date and Annuity Payment Options available for Qualified Contracts may
also be controlled by endorsements, the plan or applicable law.

19
<PAGE>

LUMP SUM PAYMENT OPTION

You may surrender the Contract at any time while the Annuitant is living and
before the Annuity Date. The Surrender Value is equal to the Accumulated
Value, adjusted for any Market Value Adjustment or other deductions applicable
to amounts allocated to a General Account Guaranteed Option, less any amount
allocated to the Five-Year Guaranteed Equity Option, less any Premium Taxes
incurred but not yet deducted.

ANNUITY PAYMENT OPTIONS

All Annuity Payment Options (except for the Designated Period Annuity Option)
are offered as "Variable Annuity Options." This means that Annuity Payments,
after the initial payment, will reflect the investment experience of the
Portfolio or Portfolios you have chosen. All Annuity Payment Options are also
offered as "Fixed Annuity Options." This means that the amount of each payment
will be set on the Annuity Date and will not change. The following Annuity
Payment Options are available under the Contract:

Life Annuity--Monthly Annuity Payments are paid for the life of an Annuitant,
ceasing with the last Annuity Payment due prior to the Annuitant's death.

Joint and Last Survivor Annuity--Monthly Annuity Payments are paid for the
life of two Annuitants and thereafter for the life of the survivor, ceasing
with the last Annuity Payment due prior to the survivor's death.

Life Annuity with Period Certain--Monthly Annuity Payments are paid for the
life of an Annuitant, with a Period Certain of not less than 120, 180, or 240
months, as elected.

Installment or Unit Refund Life Annuity--Available as either a Fixed
(Installment Refund) or Variable (Unit Refund) Annuity Option. Monthly Annuity
Payments are paid for the life of an Annuitant, with a Period Certain
determined by dividing the Accumulated Value by the first Annuity Payment.

Designated Period Annuity--Only available as a Fixed Annuity Option. Monthly
Annuity Payments are paid for a Period Certain as elected, which may be from
10 to 30 years.

Before the Annuity Date and while the Annuitant is living, you may change the
Annuity Payment Option by written request. The request for change must be made
at least 30 days prior to the Annuity Date and is subject to the approval of
the Company. If an Annuity Payment Option is chosen that depends on the
continuation of the life of the Annuitant, proof of birth date may be required
before Annuity Payments begin. For Annuity Payment Options involving life
income, the actual age of the Annuitant will affect the amount of each
payment. Since payments to older Annuitants are expected to be fewer in
number, the amount of each Annuity Payment will generally be greater.

All or part of the Accumulated Value may be placed under one or more Annuity
Payment Options. If Annuity Payments are to be paid under more than one
option, the Company must be told what part of the Accumulated Value is to be
paid under each option.

If at the time of any Annuity Payment you have not provided the Company with a
written election not to have federal income taxes withheld, the Company must
by law withhold such taxes from the taxable portions of such Annuity Payment
and remit that amount to the federal government.

In the event that an Annuity Payment Option is not selected, the Company will
make monthly Annuity Payments that will go on for as long as the Annuitant
lives (120 payments guaranteed) in accordance with the Life Annuity with
Period Certain Option and the annuity benefit sections of the Contract. That
portion of the Accumulated Value that has been held in a Portfolio prior to
the Annuity Date will be applied under a Variable Annuity Option based on the
performance of that Portfolio. Subject to approval by the Company, you may
select any other Annuity Payment Option then being offered by the Company. All
Fixed Annuity Payments and the initial Variable Annuity Payment are guaranteed
to be not less than as provided by the Annuity Tables and the Annuity Payment
Option elected by the Contract Owner. The minimum payment, however, is $100.
If the Accumulated Value is less than $5,000, or less than $2,000 for Texas
Contract Owners, the Company has the right to pay that amount in a lump sum.
From time to time, the Company may require proof that the Annuitant or
Contract Owner is living. Annuity Payment Options are not available to: (1) an
assignee; or (2) any other than a natural person, except with the consent of
the Company.

20
<PAGE>

We may, at the time of election of an Annuity Payment Option, offer more
favorable rates in lieu of the guaranteed rates specified in the Annuity
Tables found in the Contract.

The value of Variable Annuity Payments will reflect the investment experience
of the chosen Portfolio. Only one Variable Annuity Option may be chosen from
among those made available by the Company for each Portfolio. The Annuity
Tables, which are contained in the Contract and are used to calculate the
value of the initial Variable Annuity Payment, are based on an assumed
interest rate of 4%. If the actual net investment experience exactly equals
the assumed interest rate, then the Variable Annuity Payments will remain the
same (equal to the first Annuity Payment). However, if actual investment
experience exceeds the assumed interest rate, the Variable Annuity Payments
will increase; conversely, they will decrease if the actual experience is
lower. The method of computation of Variable Annuity Payments is described in
more detail in the Statement of Additional Information.

The value of all payments, both fixed and variable, will be greater for
shorter guaranteed periods than for longer guaranteed periods, and greater for
life annuities than for joint and survivor annuities, because they are
expected to be made for a shorter period.

After the Annuity Date, you may change the Portfolio funding the Variable
Annuity Payments on the appropriate Company form or by calling our
Administrative Offices at 1-800-866-6007.

DEFERMENT OF PAYMENT

Payment of any cash withdrawal or lump sum Death Benefit due from the Separate
Account will occur within seven days from the date the election becomes
effective except that the Company may be permitted to defer such payment if:
(1) the New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on the New York Stock Exchange is otherwise restricted:
or (2) an emergency exists as defined by the SEC, or the SEC requires that
trading be restricted: or (3) the SEC permits a delay for the protection of
Contract Owners.

As to amounts allocated to the General Account, we may, at any time, defer
payment of the Surrender Value for up to six months after we receive a request
for it. We will allow interest of at least 4% annually on any Surrender Value
payment derived from the General Account that we defer 30 days or more.

FEDERAL TAX CONSIDERATIONS

INTRODUCTION

The ultimate effect of federal income taxes on the amounts paid for the
Contract, on the investment return on assets held under a Contract, on Annuity
Payments, and on the economic benefits to the Contract Owner, Annuitant or
Annuitant's Beneficiary, depends on the terms of the Contract, the Company's
tax status and upon the tax status of the individuals concerned. The following
discussion is general in nature and is not intended as tax advice. You should
consult a tax adviser regarding the tax consequences of purchasing a Contract.
No attempt is made to consider any applicable state or other tax laws.
Moreover, the discussion is based upon the Company's understanding of the
federal income tax laws as they are currently interpreted. No representation
is made regarding the likelihood of continuation of the federal income tax
laws, the Treasury regulations or the current interpretations by the Internal
Revenue Service. We reserve the right to make uniform changes in the Contract
to the extent necessary to continue to qualify the Contract as an annuity. For
a discussion of federal income taxes as they relate to the Funds, please see
the accompanying Prospectuses for the Funds.

TAXATION OF ANNUITIES IN GENERAL

Section 72 of the Code governs taxation of annuities. In general, a Contract
Owner is not taxed on increases in value under a Contract until some form of
withdrawal or distribution is made under it. However, under certain
circumstances, the increase in value may be subject to current federal income
tax. (See "Contracts Owned by Non-Natural Persons," page 23 and
"Diversification Standards", page 23).

Section 72 provides that the proceeds of a full or partial withdrawal from a
Contract prior to the Annuity Date will be treated as taxable income to the
extent the amounts held under the Contract exceed the "investment in the
Contract," as that term is defined in the Code. The "investment in the
Contract" can generally be described as the cost of the Contract, and
generally constitutes all Purchase Payments paid for the Contract less any
amounts received under the Contract that are excluded from the individual's
gross income. The taxable portion is taxed at ordinary income tax rates. For
purposes of this rule, a pledge or assignment of a Contract is treated as a
payment received on account of a partial withdrawal of a Contract.

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<PAGE>

Upon receipt of a full or partial withdrawal or an Annuity Payment under the
Contract, you will be taxed if the value of the Contract exceeds the
investment in the Contract. Ordinarily, the taxable portion of such payments
will be taxed at ordinary income tax rates.

For Fixed Annuity Payments, in general, the taxable portion of each payment is
determined by using a formula known as the "exclusion ratio," which
establishes the ratio that the investment in the Contract bears to the total
expected amount of Annuity Payments for the term of the Contract. That ratio
is then applied to each payment to determine the non-taxable portion of the
payment. The remaining portion of each payment is taxed at ordinary income tax
rates. For Variable Annuity Payments, in general, the taxable portion is
determined by a formula that establishes a specific dollar amount of each
payment that is not taxed. The dollar amount is determined by dividing the
investment in the Contract by the total number of expected periodic payments.
The remaining portion of each payment is taxed at ordinary income tax rates.
Once the excludible portion of Annuity Payments to date equals the investment
in the Contract, the balance of the Annuity Payments will be fully taxable.

Withholding of federal income taxes on all distributions may be required
unless the recipient elects not to have any amounts withheld and properly
notifies the Company of that election.

With respect to amounts withdrawn or distributed before the taxpayer reaches
age 59 1/2, a penalty tax is imposed equal to 10% of the taxable portion of
amounts withdrawn or distributed. However, the penalty tax will not apply to
withdrawals (i) made on or after the death of the Contract Owner or, where the
Contract Owner is not an individual, the death of the Annuitant, who is
defined as the individual the events in whose life are of primary importance
in affecting the timing and payment under the Contracts; (ii) attributable to
the taxpayer's becoming disabled within the meaning of Code Section 72(m)(7);
(iii) that are part of a series of substantially equal periodic payments made
at least annually for the life (or life expectancy) of the taxpayer, or joint
lives (or joint life expectancies) of the taxpayer and his beneficiary; (iv)
from a qualified plan (note, however, other penalties may apply); (v) under a
qualified funding asset (as defined in Code Section 130(d)); (vi) under an
immediate annuity contract as defined in Section 72(u)(4); or (vii) that are
purchased by an employer on termination of certain types of qualified plans
and that are held by the employer until the employee separates from service.
Other tax penalties may apply to certain distributions as well as to certain
contributions and other transactions under Qualified Contracts.

If the penalty tax does not apply to a withdrawal as a result of the
application of item (iii) above, and the series of payments are subsequently
modified (other than by reason of death or disability), the tax for the year
in which the modification occurs will be increased by an amount (as determined
under Treasury Regulations) equal to the tax that would have been imposed but
for item (iii) above, plus interest for the deferral period. The foregoing
rule applies if the modification takes place (a) before the close of the
period that is five years from the date of the first payment and after the
taxpayer attains age 59 1/2, or (b) before the taxpayer reaches age 59 1/2.

THE COMPANY'S TAX STATUS

The Company is taxed as a life insurance company under Part I of Subchapter L
of the Code. Since the Separate Account is not a separate entity from the
Company and its operations form a part of the Company, it will not be taxed
separately as a "regulated investment company" under Subchapter M of the Code.
Investment income and realized capital gains on the assets of the Separate
Account are reinvested and taken into account in determining the Accumulated
Value. Under existing federal income tax law, the Separate Account's
investment income, including realized net capital gains, is not taxed to the
Company. The Company reserves the right to make a deduction for taxes should
they be imposed with respect to such items in the future.

DISTRIBUTION-AT-DEATH RULES

22
<PAGE>

commence within one year after the Contract Owner's death. If the Owner's
Designated Beneficiary is the spouse of the Contract Owner, the Contract
(together with the deferral on tax on the accrued and future income
thereunder) may be continued unchanged in the name of the spouse as Contract
Owner. The term Owner's Designated Beneficiary means the natural person named
by the Contract Owner as a beneficiary and to whom ownership of the Contract
passes by reason of the Contract Owner's death (unless the Contract Owner was
also the Annuitant--in which case the Annuitant's Beneficiary is entitled to
the Death Benefit).

If the Contract Owner is not an individual, the "primary Annuitant" (as
defined under the Code) is considered the Contract Owner. The primary
Annuitant is the individual who is of primary importance in affecting the
timing or the amount of payout under a Contract. In addition, when the
Contract Owner is not an individual, a change in the primary Annuitant is
treated as the death of the Contract Owner. Finally, in the case of joint
Contract Owners, the distribution will be required at the death of the first
of the Contract Owners.

TRANSFERS OF ANNUITY CONTRACTS

Any transfer of a Non-Qualified Contract prior to the Annuity Date for less
than full and adequate consideration will generally trigger tax on the gain in
the Contract to the Contract Owner at the time of such transfer. The
investment in the Contract of the transferee will be increased by any amount
included in the Contract Owner's income. This provision, however, does not
apply to those transfers between spouses or incident to a divorce which are
governed by Code Section 1041(a).

CONTRACTS OWNED BY NON-NATURAL PERSONS

Where the Contract is held by a non-natural person (for example, a
corporation), the Contract is generally not treated as an annuity contract for
federal income tax purposes, and the income on that Contract (generally the
increase in the net Accumulated Value less the payments) is includible in
taxable income each year. The rule does not apply where the non-natural person
is only a nominal owner such as a trust or other entity acting as an agent for
a natural person. If an employer is the nominal owner of a Contract, and the
beneficial owners are employees, then the Contract is not treated as being
held by a non-natural person. The rule also does not apply where the Contract
is acquired by the estate of a decedent, where the Contract is a qualified
funding asset for structured settlements, where the Contract is purchased on
behalf of an employee upon termination of a qualified plan, and in the case of
an immediate annuity.

ASSIGNMENTS

A transfer of ownership of a Contract, a collateral assignment or the
designation of an Annuitant or other beneficiary who is not also the Contract
Owner may result in tax consequences to the Contract Owner, Annuitant or
beneficiary that are not discussed herein. A Contract Owner contemplating such
a transfer or assignment of a Contract should contact a tax adviser with
respect to the potential tax effects of such a transaction.

MULTIPLE CONTRACTS RULE

All non-qualified annuity contracts issued by the same company (or affiliate)
to the same Contract Owner during any calendar year are to be aggregated and
treated as one contract for purposes of determining the amount includible in
the taxpayer's gross income. Thus, any amount received under any Contract
prior to the Contract's Annuity Date, such as a partial withdrawal, will be
taxable (and possibly subject to the 10% penalty tax) to the extent of the
combined income in all such contracts. The Treasury Department has specific
authority to issue regulations that prevent the avoidance of Code Section
72(e) through the serial purchase of annuity contracts or otherwise. In
addition, there may be other situations in which the Treasury Department may
conclude that it would be appropriate to aggregate two or more Contracts
purchased by the same Contract Owner. Accordingly, a Contract Owner should
consult a tax adviser before purchasing more than one Contract or other
annuity contracts.

DIVERSIFICATION STANDARDS

To comply with certain diversification regulations ("Regulations") under Code
Section 817(h), after a start up period, the Separate Account will be required
to diversify its investments. The Regulations generally require that on the
last day of each quarter of a calendar year, no more than 55% of the value of
the Separate Account is represented by any one investment, no more than 70% is
represented by any two investments, no more than 80% is represented by any
three investments, and no more than 90% is represented by any four
investments. A "look-through" rule applies that suggests that each Subaccount
of the Separate Account will be tested for compliance with the percentage
limitations by looking through to the assets of the Portfolio of the Fund in
which each such division invests. All securities of the same issuer are
treated as a single investment. Each government agency or instrumentality will
be treated as a separate issuer for purposes of those limitations.

23
<PAGE>

In connection with the issuance of temporary diversification regulation in
1986, the Treasury Department announced that such regulations did not provide
guidance concerning the extent to which Contract Owners may direct their
investments to particular divisions of a separate account. It is possible that
regulations or revenue rulings may be issued in this area at some time in the
future. It is not clear, at this time, what these regulations or rulings would
provide. It is possible that when the regulations or ruling are issued, the
Contracts may need to be modified in order to remain in compliance. For these
reasons, the Company reserves the right to modify the Contracts, as necessary,
to prevent the Contract Owner from being considered the owner of assets of the
Separate Account.

We intend to comply with the Regulations to assure that the Contracts continue
to be treated as annuity contracts for federal income tax purposes.

403(B) CONTRACTS

Contracts will be offered in connection with retirement plans adopted by
public school systems and certain tax-exempt organizations (Code Section
501(c)(3) organizations) for their employees under Section 403(b) of the Code.
Except, as discussed below and subject to any conditions in an employer's
plan, a Contract used in connection with a Section 403(b) Plan offers the same
benefits and is subject to the same charges described in this Prospectus.

The Code imposes a maximum limit on annual Purchase Payments which may be
excluded from your gross income. Such limit must be calculated in accordance
with Sections 403(b), 415 and 402(g) of the Code. In addition, Purchase
Payments will be excluded from your gross income only if the 403(b) Plan meets
certain Code non-discrimination requirements.

Under your 403(b) Contract, you may borrow against your Contract's Surrender
Value after the first Contract Year. No additional loans will be extended
until prior loan balances are paid in full. The loan amount must be at least
$1,000 with a minimum vested Accumulated Value of $2,000. The loan amount may
not exceed the lesser of (a) or (b), where (a) is 50% of the Contract's vested
Accumulated Value on the date on which the loan is made, and (b) is $50,000
reduced by the highest outstanding balance of any loan within the preceding 12
months ending on the day before the current loan is made. If you are married,
your spouse must consent in writing to a loan request. This consent must be
given within the 90-day period before the loan is to be made.

On the first Business Day of each calendar month, the Company will determine a
loan interest rate. The loan interest rate for the calendar month in which the
loan is effective will apply for one year from the loan effective date.
Annually on the anniversary of the loan effective date, the rate will be
adjusted to equal the loan interest rate determined for the month in which the
loan anniversary occurs.

Principal and interest on loans must be amortized in quarterly installments
over a five year term except for certain loans for the purchase of a principal
residence. If the loan interest rate is adjusted, future payments will be
adjusted so that the outstanding loan balance is amortized in equal quarterly
installments over the remaining term. A $40 processing fee is charged for each
loan. The remainder of each repayment will be credited to the individual
account.

If a loan payment is not made when due, interest will continue to accrue. The
defaulted payment plus accrued interest will be deducted from any future
distributions under the Contract and paid to us. Any loan payment which is not
made when due, plus interest, will be treated as a distribution, as permitted
by law. The loan payment may be taxable to the borrower, and may be subject to
the early withdrawal tax penalty. When a loan is made, the number of
Accumulation Units equal to the loan amount will be withdrawn from the
individual account and placed in the Collateral Fixed Account. Accumulation
Units taken from the individual account to provide a loan do not participate
in the investment experience of the related Portfolios or the guarantees of
the General Account Guaranteed Options. The loan amount will be withdrawn on a
pro rata basis first from the Portfolios to which Accumulated Value has been
allocated, and if that amount is insufficient, collateral will then be
transferred from the General Account Guaranteed Options--except the Five-Year
Guaranteed Equity Option. As with any withdrawal, Market Value Adjustments or
other deductions applicable to amounts allocated to General Account Guaranteed
Options may be applied and no amounts may be withdrawn from the Five-Year
Guaranteed Equity Option. Until the loan is repaid in full, that portion of
the Collateral Fixed Account shall be credited with interest at a rate of 2%
less than the loan interest rate applicable to the loan--however, the interest
rate credited will never be less than the General Account Guaranteed Options
guaranteed rate of 3%.

24
<PAGE>

A bill in the amount of the quarterly principal and interest will be mailed
directly to you in advance of the payment due date. The initial quarterly
repayment will be due three months from the loan date. The loan date will be
the date that the Company receives the loan request form in good order.
Payment is due within 30 calendar days after the due date. Subsequent
quarterly installments are based on the first due date.

When repayment of principal is made, Accumulation Units will be reallocated on
a current value basis among the same investment Portfolios and/or General
Account Guaranteed Options and in the same proportion as when the loan was
initially made. If a repayment in excess of a billed amount is received, the
excess will be applied towards the principal portion of the outstanding loan.
Payments received which are less than the billed amount will not be accepted
and will be returned to you.

If a partial surrender is taken from your individual account due to nonpayment
of a billed quarterly installment, the date of the surrender will be the first
business day following the 30 calendar day period in which the repayment was
due.

Prepayment of the entire loan is allowed. At the time of prepayment, the
Company will bill you for any accrued interest. The Company will consider the
loan paid when the loan balance and accrued interest are paid.

If the individual account is surrendered with an outstanding loan balance, the
outstanding loan balance and accrued interest will be deducted from the
Surrender Value. If the individual account is surrendered, with an outstanding
loan balance, due to the Contract Owner's death or the election of an Annuity
Payment Option, the outstanding loan balance and accrued interest will be
deducted.

The Company may require that any outstanding loan be paid if the individual
account value falls below an amount equal to 25% of total loans outstanding.

The Code requires the aggregation of all loans made to an individual employee
under a single employer-sponsored 403(b) Plan. However, since the Company has
no information concerning the outstanding loans that you may have with other
companies, it will only use the information available under Contracts issued
by the Company.

The Code imposes restrictions on full or partial surrenders from 403(b)
individual accounts attributable to Purchase Payments under a salary reduction
agreement and to any earnings on the entire 403(b) individual account credited
on and after January 1, 1989. Surrenders of these amounts are allowed only if
the Owner (a) has died, (b) has become disabled, as defined in the Code, (c)
has attained age 59 1/2, or (d) has separated from service. Surrenders are
also allowed if the Contract Owner can show "hardship," as defined by the
Internal Revenue Service, but the surrender is limited to the lesser of
Purchase Payments made on or after January 1, 1989 or the amount necessary to
relieve the hardship. Even if a surrender is permitted under these provisions,
a 10% federal tax penalty may be assessed on the withdrawn amount if it does
not otherwise meet the exceptions to the penalty tax provisions (See "Taxation
of Annuities in General," page 21).

Under the Code, you may request a full or partial surrender of an amount equal
to the individual account cash value as of December 31, 1988 (the
"grandfathered" amount), subject to the terms of the 403(b) Plan. Although the
Code surrender restrictions do not apply to this amount, a 10% federal penalty
tax may be assessed on the withdrawn amount if it does not otherwise meet the
exceptions to the penalty tax provisions. (See "Taxation of Annuities in
General," page 21).

The Company believes that the Code surrender restrictions do not apply to tax-
free transfers pursuant to Revenue Ruling 90-24. The Company further believes
that the surrender restrictions will not apply to any "grandfathered" amount
transferred pursuant to Revenue Ruling 90-24 into another 403(b) Contract.

GENERAL INFORMATION

ADDITIONS, DELETIONS, OR SUBSTITUTIONS OF INVESTMENTS

The Company retains the right, subject to any applicable law, to make certain
changes. The Company reserves the right to eliminate the shares of any of the
Portfolios and to substitute shares of another Portfolio of the Funds, or of
another registered, open-end management investment company, if the shares of
the Portfolios are no longer available for investment, or, if in the Company's
judgment, investment in any Portfolio would be inappropriate in view of the
purposes of the Separate Account. To the extent required by the 1940 Act,
substitutions of shares attributable to a Contract Owner's interest in a
Portfolio will not be made until SEC approval has been obtained and the
Contract Owner has been notified of the change.

25
<PAGE>

New Portfolios may be established at the discretion of the Company. Any new
Portfolios will be made available to existing Contract Owners on a basis to be
determined by the Company. The Company may also eliminate one or more
Portfolios if marketing, tax, investment or other conditions so warrant.

In the event of any such substitution or change, the Company may, by
appropriate endorsement, make such changes in the Contracts as may be
necessary or appropriate to reflect such substitution or change. Furthermore,
if deemed to be in the best interests of persons having voting rights under
the Contracts, the Separate Account may be operated as a management company
under the 1940 Act or any other form permitted by law, may be deregistered
under the 1940 Act in the event such registration is no longer required, or
may be combined with one or more other separate accounts.

VOTING RIGHTS

The Fund does not hold regular meetings of shareholders. The Directors of each
Fund may call special meetings of shareholders as may be required by the 1940
Act or other applicable law. To the extent required by law, the Portfolio
shares held in the Separate Account will be voted by the Company at
shareholder meetings of the Funds in accordance with instructions received
from persons having voting interests in the corresponding Portfolio. Fund
shares as to which no timely instructions are received or shares held by the
Company as to which Contract Owners have no beneficial interest will be voted
in proportion to the voting instructions that are received with respect to all
Contracts participating in that Portfolio. Voting instructions to abstain on
any item to be voted upon will be applied on a pro rata basis to reduce the
votes eligible to be cast.

The number of votes that are available to a Contract Owner will be calculated
separately for each Portfolio of the Separate Account. That number will be
determined by applying his or her percentage interest, if any, in a particular
Portfolio to the total number of votes attributable to the Portfolio.

Prior to the Annuity Date, a Contract Owner holds a voting interest in each
Portfolio to which the Accumulated Value is allocated. The number of votes
which are available to a Contract Owner will be determined by dividing the
Accumulated Value attributable to a Portfolio by the net asset value per share
of the applicable Portfolio. After the Annuity Date, the person receiving
Annuity Payments has the voting interest. The number of votes after the
Annuity Date will be determined by dividing the reserve for such Contract
allocated to the Portfolio by the net asset value per share of the
corresponding Portfolio. After the Annuity Date, the votes attributable to a
Contract decrease as the reserves allocated to the Portfolio decrease. In
determining the number of votes, fractional shares will be recognized.

The number of votes of the Portfolio that are available will be determined as
of the date coincident with the date established by that Portfolio for
determining shareholders eligible to vote at the meeting of the Funds. Voting
instructions will be solicited by written communication prior to such meeting
in accordance with procedures established by the Funds.

AUDITORS

Ernst & Young LLP serves as independent auditors for the Separate Account and
the Company, and will audit their financial statements annually.

LEGAL MATTERS

Jorden Burt Berenson & Johnson LLP of Washington, D.C. has provided legal
advice relating to the federal securities laws applicable to the issue and
sale of the Contracts. All matters of Missouri law pertaining to the validity
of the Contracts and the Company's right to issue such Contracts have been
passed upon by Kimberly A. Scouller, Esquire, on behalf of the Company.

26
<PAGE>

TABLE OF CONTENTS FOR THE PROVIDIAN PRISM VARIABLE ANNUITY

STATEMENT OF ADDITIONAL INFORMATION

<TABLE>
<CAPTION>
PAGE
<S> <C>
THE CONTRACT.............................................................. 2
Computation of Variable Annuity Income Payments......................... 2
Exchanges............................................................... 3
Exceptions to Charges and to Transaction or Balance Requirements........ 3
GENERAL MATTERS........................................................... 3
Non-Participating....................................................... 3
Misstatement of Age or Sex.............................................. 3
Assignment.............................................................. 4
Annuity Data............................................................ 4
Annual Statement........................................................ 4
Incontestability........................................................ 4
Ownership............................................................... 4
PERFORMANCE INFORMATION................................................... 4
Money Market Subaccount Yields.......................................... 5
30-Day Yield for Non-Money Market Subaccounts........................... 5
Standardized Average Annual Total Return for Subaccounts................ 5
ADDITIONAL PERFORMANCE MEASURES........................................... 7
Non-Standardized Actual Total Return and Non-Standardized Actual Average
Annual Total Return.................................................... 7
Non-Standardized Total Return Year-to-Date.............................. 8
Non-Standardized One Year Return........................................ 9
Non-Standardized Hypothetical Total Return and Non-Standardized
Hypothetical Average Annual Total Return............................... 9
Individualized Computer Generated Illustrations......................... 20
PERFORMANCE COMPARISONS................................................... 20
SAFEKEEPING OF ACCOUNT ASSETS............................................. 22
THE COMPANY............................................................... 22
STATE REGULATION.......................................................... 22
RECORDS AND REPORTS....................................................... 22
DISTRIBUTION OF THE CONTRACTS............................................. 23
LEGAL PROCEEDINGS......................................................... 23
OTHER INFORMATION......................................................... 23
FINANCIAL STATEMENTS...................................................... 24
</TABLE>

27
<PAGE>

APPENDIX A

THE GENERAL ACCOUNT

Because of applicable exemptive and exclusionary provisions, interests in the
General Account have not been registered under the Securities Act of 1933
("the 1933 Act"), nor under the 1940 Act. Thus, neither our General Account,
nor any interest therein are generally subject to regulation under the
provisions of the 1933 Act or the 1940 Act. Accordingly, the Company has been
advised that the staff of the SEC has not reviewed the disclosure in this
Appendix relating to the General Account. These disclosures regarding the
General Account may, however, be subject to certain generally applicable
provisions of the federal securities laws relating to the accuracy and
completeness of statements made in prospectuses.

Note: The General Account Guaranteed Options, or certain of them, are
currently available for sale in most, but not all, states. Please check with
your sales representative for details of the availability of these features
before purchasing.

The General Account contains all of the assets of the Company other than those
in the separate accounts we establish. The Company has sole discretion to
invest the assets of the General Account, subject to applicable law.
Allocation of any amounts to the General Account does not entitle you to share
directly in the investment experience of these assets.

There are three fixed options under the General Account: the One-Year
Guaranteed Index Rate Option, the Five-Year Guaranteed Index Rate Option, and
the Five-Year Guaranteed Equity Option, each described below:

One-Year Guaranteed Index Rate Option

You may allocate your Accumulated Value to this option at any time. The
Accumulated Value you allocate under this option earns interest equal to 90%
of the one-year constant maturity Treasury rate at the time your allocation is
made with a guarantee that the Accumulated Value in this General Account
Guaranteed Option will not be less than the amounts allocated, plus 3%.

You may allocate any or all of your Accumulated Value from this General
Account Guaranteed Option to any of the Subaccounts or other General Account
Guaranteed Options at any time before the end of the one-year guarantee
period. However, for any amounts so transferred we will deduct an amount equal
to the interest the transferred value earned over the previous 90 days at the
applicable one-year rate. For full and partial withdrawals of amounts
allocated to this General Account Guaranteed Option prior to the end of the
one-year guarantee period, we will deduct an amount equal to the interest
earned on the amount withdrawn during the previous 90 days at the applicable
one-year rate plus we will deduct any applicable surrender charge.

At the end of the one-year guarantee period, you may, without loss of
interest, elect to transfer all or part of your Accumulated Value under this
option to any of the Subaccounts or transfer to another General Account
Guaranteed Option or renew your participation in this option. Notice of such
an election must be provided to the Company no later than 15 days after the
end of the one-year guarantee period (and each subsequent one-year guarantee
period). If no such election is made, your Accumulated Value will
automatically be renewed under this option for the next one-year guarantee
period.

Five-Year Guaranteed Index Rate Option

You may allocate your Accumulated Value to this option at any time. The
Accumulated Value you allocate under this option earns interest equal to 100%
of the five-year constant maturity Treasury rate at the time your allocation
is made with a guarantee that the Accumulated Value in this General Account
Guaranteed Option will not be less than the amount initially allocated, plus
3%, compounded annually.

You may allocate any or all of your Accumulated Value from this General
Account Guaranteed Option to any of the Subaccounts or other General Account
Guaranteed Options at any time before the end of the five-year guarantee
period. However, for any amounts so transferred we will apply a Market Value
Adjustment (as described below) against such amounts. For full and partial
withdrawals of amounts allocated to this General Account Guaranteed Option
prior to the end of the five-year guarantee period, we will apply a Market
Value Adjustment (as described below) against such amounts withdrawn plus we
will deduct any applicable surrender charge.

A-1
<PAGE>

The Market Value Adjustment ("MVA") Factor for the Five-Year Guaranteed Index
Rate Option will be as follows:

N x (B - E)
12 1 + E
where N =
the number of months left in the five-year guarantee period at the time
of the transfer or surrender (including any partial months which will
count as full months for purposes of this calculation);
B =
the applicable five-year constant maturity Treasury rate at the
beginning of the five-year guarantee period; and
E =
the applicable five-year constant maturity Treasury rate at the time of
the transfer or surrender.

The MVA is applied to the Accumulated Value in order to determine the net
amount of the transfer or surrender under this option prior to the deduction
of any applicable surrender charge. Generally, if the five-year constant
maturity Treasury rate at the beginning of the five-year guarantee period is
lower than the five-year constant maturity Treasury rate prevailing at the
time of the transfer or surrender, then the application of the MVA will result
in a lower payment upon transfer or surrender. Similarly, if the five-year
constant maturity Treasury rate at the beginning of the five-year guarantee
period is higher than the prevailing five-year constant maturity Treasury rate
at the time of transfer or surrender, then the application of the MVA will
result in a higher payment upon transfer or surrender.

The following is an example of how your Accumulated Value under the Five-Year
Guaranteed Index Rate Option is affected by a positive Market Value
Adjustment:

Assume an initial allocation of $100,000 when the five-year constant maturity
Treasury rate is 8%. At the end of 12 months, your Accumulated Value is
$108,000. Assume also you surrender at the end of one year with 48 months of
the guarantee period remaining and the five-year constant maturity Treasury
rate is 7%.

Accumulated Value = $108,000

<TABLE>
<S> <C> <C> <C> <C> <C> <C>
MVA Factor = 48 x .08 - .07 = 4 x .00935 = .0374
12 1 + .07
Adjustment = $108,000 x .0374 = $4,039
= $108,000 + $4,039 = $112,039 = Net amount of transfer or
surrender (before application of a surrender charge)
</TABLE>

The following is an example of how your Accumulated Value under the Five-Year
Guaranteed Index Rate Option is affected by a negative Market Value
Adjustment:

Assume an initial allocation of $100,000 when the five-year constant maturity
Treasury rate is 8%. At the end of 12 months, your Accumulated Value is
$108,000. Assume also you surrender at the end of one year with 48 months
remaining in the guarantee period and the five-year constant maturity Treasury
rate is 9%.

Accumulated Value = $108,000

<TABLE>
<S> <C> <C> <C> <C> <C> <C>
MVA Factor = 48 x .08 - .09 = 4 x .00917 = -.0367
12 1 + .09
Adjustment = $108,000 x -.0367 = -$3,964
= $108,000 - $3,964 = $104,036 = Net amount of transfer or
surrender (before application of a surrender charge)
</TABLE>

Notwithstanding application of a negative Market Value Adjustment, any Net
Purchase Payments allocated to this General Account Guaranteed Option will
earn interest of at least 3%, compounded annually.

At the end of the five-year guarantee period, you may, without loss of
interest, elect to transfer any or all of your Accumulated Value under this
option to any of the Subaccounts or transfer to another General Account
Guaranteed Option or renew your participation in this option. Such election
must be provided to the Company before the end of the five-year guarantee
period (and each subsequent five-year guarantee period). If no election is
made, your Accumulated Value will automatically be renewed under this option
for the next five-year guarantee period.

A-2
<PAGE>

Five-Year Guaranteed Equity Option

You may allocate your Accumulated Value to this option as of the first
business day of each month. During the five-year guarantee period applicable
to Accumulated Value allocated to this option, we will credit interest at a
guaranteed annual effective rate of 3%, compounded annually. At the end of the
five-year guarantee period we will credit additional interest in an amount
equal to the amount by which (a) exceeds (b), where: (a) equals the percentage
change in the S&P 500(R) Composite Stock Price Index from the date Accumulated
Value is allocated to the end of the five-year guarantee period, multiplied by
the amount allocated; and (b) equals the total amount of interest credited
during the five-year guarantee period. ("S&P 500(R)" is a trademark of The
McGraw-Hill Companies, Inc. and has been licensed for use by Providian
Corporation.)

THIS OPTION IS ILLIQUID FOR THE ENTIRE FIVE-YEAR GUARANTEE PERIOD AND,
ACCORDINGLY, DOES NOT PERMIT ANY EXCHANGES OR REALLOCATIONS OF ACCUMULATED
VALUE TO THE SUBACCOUNTS OR OTHER GENERAL ACCOUNT GUARANTEED OPTIONS OR FULL
OR PARTIAL WITHDRAWALS DURING SUCH FIVE-YEAR PERIOD. However, during such
guarantee period, the Accumulated Value allocated under this option may be
annuitized under any of the Annuity Payment Options.

At the end of the five-year guarantee period, you may, without loss of
earnings, elect to transfer all or part of your Accumulated Value under this
Option to any of the Subaccounts, transfer into another General Account
Guaranteed Option or renew your participation in this option. Such election
must be received by the Company no later than 30 days prior to the end of the
five-year guarantee period. If no election is received, your Accumulated Value
will automatically be transferred to the CRI Money Market Portfolio. This
option may not be available at all times.

DISCLAIMER REGARDING STANDARD & POOR'S(R) 500 INDEX

The Five-Year Guaranteed Equity Option (the "GEO") is not sponsored,
endorsed, sold or promoted by Standard & Poor's Corporation ("S&P"). S&P makes
no representation or warranty, express or implied, to investors in the GEO or
any member of the public regarding the advisability of investing in securities
generally or in the GEO particularly or the ability of the S&P 500(R) Index to
track general stock market performance. S&P's only relationship to Providian
Life and Health Insurance Company is the licensing of certain trademarks and
trade names of S&P and of the S&P 500(R) Index which is determined, composed
and calculated by S&P without regard to Providian Life and Health Insurance
Company or the GEO. S&P has no obligation to take the needs of Providian Life
and Health Insurance Company or the investors in the GEO into consideration in
determining, composing or calculating the S&P 500(R) Index. S&P is not
responsible for and has not participated in the determination of the timing
of, prices at, or quantities of the GEO to be issued or in the determination
or calculation of the equation by which the GEO is to be converted into cash.
S&P has no obligation or liability in connection with the administration,
marketing or trading of the GEO.

S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P
500(R) INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO WARRANTY, EXPRESS OR
IMPLIED, AS TO RESULTS TO BE OBTAINED BY PROVIDIAN LIFE AND HEALTH INSURANCE
COMPANY, INVESTORS IN THE GEO, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF
THE S&P 500(R) INDEX OR ANY DATA INCLUDED THEREIN IN CONNECTION WITH THE
RIGHTS LICENSED BY PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY OR FOR ANY
OTHER USE. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY
DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OR USE WITH RESPECT TO THE S&P 500(R) INDEX OR ANY DATA INCLUDED
THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY
LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES
(INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

A-3
<PAGE>

PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY SEPARATE ACCOUNT V
PROSPECTUS
FOR THE
PROVIDIAN PRISM VARIABLE ANNUITY
OFFERED BY
PROVIDIAN LIFE AND HEALTH INSURANCE COMPANY
(A MISSOURI STOCK COMPANY)
ADMINISTRATIVE OFFICES
P.O. BOX 32700
LOUISVILLE, KENTUCKY 40232

The Providian PRISM variable annuity contract (the "Contract"), offered
through Providian Life and Health Insurance Company (the "Company", "us", "we"
or "our"), provides a vehicle for investing on a tax-deferred basis in five
Portfolios sponsored by Calvert Group, Ltd. ("Calvert"), one Portfolio offered
by The Dreyfus Socially Responsible Growth Fund, Inc., and our General
Account. The Contract is an individual variable annuity contract and is
intended for retirement savings or other long-term investment purposes.

The Contract offers a number of ways of withdrawing monies at a future date,
including a lump sum payment and several Annuity Payment Options. Full or
partial withdrawals from the Contract's Surrender Value may be made at any
time, although in many instances withdrawals made prior to age 59 1/2 are
subject to a 10% penalty tax (and a portion may be subject to ordinary income
taxes) and may be subject to a surrender charge of up to 6%. If you elect an
Annuity Payment Option, Annuity Payments may be received on a fixed and/or
variable basis. You also have significant flexibility in choosing the Annuity
Date on which Annuity Payments begin.

Providian Prism Contracts are offered in two versions with differing charge
structures and features. THIS PROSPECTUS DESCRIBES ONLY THE STANDARD PROVIDIAN
PRISM CONTRACT. Also available is an A Unit Contract which is offered only by
an A Unit prospectus. For further information see "Alternate Contract Version"
at page 7.

This Prospectus sets forth the information you should know before investing in
the Contract. It must be accompanied by the current Prospectus for each Fund.
Please read the Prospectuses carefully and retain them for future reference. A
Statement of Additional Information, dated April 30, 1996, as supplemented
November 1, 1996, for the Contract Prospectus has also been filed with the
Securities and Exchange Commission, is incorporated herein by reference and is
available free by calling our Administrative Offices at 1-800-866-6007. The
Table of Contents of the Statement of Additional Information is included at
the end of this Prospectus.

The Contract is not available in all States.

The date of this Prospectus is April 30, 1996 as revised November 1, 1996.

FM-1164(B)
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TABLE OF CONTENTS

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GLOSSARY................................................................... 2
HIGHLIGHTS................................................................. 5
FEE TABLE.................................................................. 7
Condensed Financial Information............................................ 9
Financial Statements....................................................... 9
Performance Measures....................................................... 9
Additional Performance Measures............................................ 10
Yield and Effective Yield.................................................. 10
The Company and the Separate Account....................................... 11
Acacia Capital Corporation................................................. 11
Calvert Group, Ltd......................................................... 11
The Dreyfus Socially Responsible Growth Fund, Inc.......................... 11
The Portfolios............................................................. 12
CONTRACT FEATURES.......................................................... 13
Right to Cancel Period................................................... 13
Contract Purchase and Purchase Payments.................................. 13
Purchasing by Wire....................................................... 14
Allocation of Purchase Payments.......................................... 14
Charges and Deductions................................................... 14
Accumulated Value........................................................ 16
Exchanges Among the Portfolios........................................... 17
Full and Partial Withdrawals............................................. 17
Systematic Withdrawal Option............................................. 18
Dollar Cost Averaging Option............................................. 18
IRS-Required Distributions............................................... 19
Minimum Balance Requirement.............................................. 19
Designation of an Annuitant's Beneficiary................................ 19
Death of Annuitant Prior to Annuity Date................................. 20
Annuity Date............................................................. 20
Lump Sum Payment Option.................................................. 20
Annuity Payment Options.................................................. 20
Deferment of Payment..................................................... 21
FEDERAL TAX CONSIDERATIONS................................................. 22
GENERAL INFORMATION........................................................ 26
APPENDIX A
The General Account...................................................... A-1
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