SEPARATE ACCOUNT VA 2LNY OF FIRST TRANSAMERICA LIFE INS CO, 497, 1997-10-01

SEPARATE ACCOUNT VA 2LNY OF FIRST TRANSAMERICA LIFE INS CO
497, 1997-10-01

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PROFILE

Of The

DREYFUS/TRANSAMERICA
TRIPLE ADVANTAGE(R)

VARIABLE ANNUITY

Issued By
TRANSAMERICA LIFE
INSURANCE COMPANY OF NEW YORK

May 1, 1997, revised October 1, 1997

This Profile is a summary of some of the more
important points that you should know and
consider before purchasing a Policy.
The Policy is more fully described in the full
Prospectus which accompanies this Profile. Please
read the Prospectus carefully.

1. The Annuity Policy. The Dreyfus/Transamerica Triple Advantage ("Policy") is
an annuity policy or a contract between you and Transamerica Life Insurance
Company of New York. In the Policy you can invest in your choice of fifteen Sub-
Accounts corresponding to fifteen mutual funds ("Portfolios") in the Variable
Account. You could gain or lose money you invest in the Portfolios.

The Policy is a deferred annuity, which means it has two phases: the
accumulation phase and the annuity phase. During the accumulation phase you can
invest additional premiums in the Policy, transfer your money among the
Portfolios, and withdraw some or all of your investment. During this phase
earnings accumulate on a tax-deferred basis for individuals, but if you withdraw
money some or all of it may be taxable. Tax deferral is not available for
corporations and some trusts.

During the annuity phase Transamerica will make periodic payments to
you. The dollar amount of the payments may depend on the amount of money
invested and earned during the accumulation phase (and other factors, such as
age and sex).

2. The Annuity Payments. You can generally decide when to end the accumulation
phase and begin receiving annuity payments from Transamerica. You can choose
fixed annuity payments, where the dollar amount of each payment generally stays
the same, or variable payments that go up or down in dollar amount based on the
investment performance of the Portfolios you select. You can choose among
payments for the lifetime of an individual, or payments for the longer of one
lifetime or a guaranteed period of 10, 15, or 20 years, or payments for one
lifetime and the lifetime of another individual.

3. Purchasing a Policy. Generally, you must invest at least $5,000 to purchase a
Policy, and then you can make more investments of at least $500 each ($100 each
if made under the automatic payment plan and deducted from your bank account).
You may cancel your Policy during the Free Look Period explained in item 10 on
page 5 of this Profile.

The Triple Advantage is designed for long-term tax-deferred
accumulation of assets, generally for retirement or other long-term goals.
People in high tax brackets get the most benefit from the tax deferral feature.
You should not make an investment in the Policy for short-term purposes or if
you cannot take the risk of losing some of your investment.

4. Investment Options. You can invest your premiums in any of the
Sub-Accounts corresponding to the following
fifteen Portfolios:

Money Market Capital Appreciation International Value
Special Value1 Stock Index Disciplined Stock
Zero Coupon 2000 Socially Responsible Growth Small Company Stock

- --------

1 The Special Value Portfolio was called Managed Assets Portfolio prior
to October 1, 1997.

<PAGE>

Quality Bond Growth and Income Balanced
Small Cap International Equity Limited Term High Income

These Portfolios are described in their own prospectuses. You can earn
or lose money in any of these Portfolios.

5. Expenses. The Policy provides many benefits and features that you do not get
with a regular mutual fund or CD investment. It costs Transamerica money to
provide these benefits, so there are charges in connection with the Policy. If
you withdraw your money within seven years of investing it, there may be a
withdrawal charge of up to 6% of the amount invested. Once each year we deduct a
Policy Fee of no more than $30 (there is no fee if your Policy Value is over
$50,000).

Insurance and administrative charges of 1.40% per year are charged
against the average daily value of your Policy. Advisory fees are also deducted
by the Portfolios' manager and the Portfolios pay other expenses which in total,
vary from 0.30% to 1.35% per year of the amounts in the Portfolios.

Finally, although New York currently has no premium tax on annuities,
depending on where you live during the time you hold this Policy, there might be
premium taxes ranging from 0 to 3.5% of your investment and/or on amounts you
use to purchase annuity benefits.

The following chart shows these charges (except premium taxes). The $30
annual Policy Fee is not included in the first column because the fee is waived
for Policy Values over $50,000 and the approximate average Policy Value is over
$50,000. The third column is the sum of the first two. The examples in the last
two columns show the total amounts you would be charged, in dollars, if you
invested $1,000, the investment grew 5% each year, and you withdrew your entire
investment after one year or ten years. Year One includes the withdrawal charge
and Year Ten does not.

EXAMPLES:
<TABLE>
<CAPTION>

Total
Variable Account Annual Annual Expenses at Total Expenses

Portfolio/ Insurance Portfolio Total Annual end of One at end of Ten
Sub-Account Charges Charges Charges Year Years
- ----------- ------- ------- ------- ---- -----

<S> <C> <C> <C> <C> <C>
Money Market 1.40% 0.62% 2.02% $76.29 $234.80

Special Value 1.40% 0.93% 2.33% $79.21 $266.60

Zero Coupon 2000 1.40% 0.66% 2.06% $76.67 $238.97

Quality Bond 1.40% 0.81% 2.21% $77.89 $252.37

Small Cap 1.40% 0.79% 2.19% $77.89 $252.37

Capital Appreciation 1.40% 0.84% 2.24% $78.37 $257.48

Stock Index 1.40% 0.30% 1.70% $73.26 $200.86

Socially Responsible 1.40% 0.99% 2.39% $79.78 $272.63

Growth & Income 1.40% 0.83% 2.23% $78.27 $256.46

International Equity 1.40% 1.28% 2.68% $82.50 $301.24

International Value 1.40% 1.35% 2.75% $83.16 $308.01

Disciplined Stock 1.40% 0.96% 2.36% $79.50 $269.62

</TABLE>

<PAGE>

$267.60ny

$298.33

$273.63High

Income

The Annual Portfolio Charges above are for 1996 and do not reflect expense
reimbursement or fee waivers except for the Balanced and Limited Term High
Income Portfolios which did not commence operations in 1996; the numbers for
these Portfolios are annualized estimates for 1997. Expenses may be higher or
lower in the future. See the Variable Account Fee Table on page 9 of the Triple
Advantage prospectus for more detailed information.

6. Federal Income Taxes. Individuals generally are not taxed on increases in the
policy value until a distribution occurs (e.g., a withdrawal or annuity payment)
or is deemed to occur (e.g., a pledge, loan, or assignment of the Policy). If
you withdraw money, earnings come out first and are taxed. Generally, some
portion (sometimes all) of any distribution or deemed distribution is taxable as
ordinary income. In some cases, income taxes will be withheld from
distributions. If you are under age 59 1/2 when you withdraw money, an
additional 10% federal tax penalty may apply to the withdrawn earnings. Certain
owners that are not individuals may be currently taxed on increases in the
Policy, whether distributed or not.

7. Access to Your Money. You can generally take money out at any time during the
accumulation phase. A withdrawal charge of up to 6% of a premium may be assessed
by Transamerica, but no withdrawal charge will be assessed on money that has
been in the Policy for seven years. Additionally, you can withdraw accumulated
earnings on your premiums not previously withdrawn at any time without a
withdrawal charge. In addition, after the first Policy Year, for only the first
withdrawal in a Policy Year, you may withdraw the greater of accumulated
earnings or 10% of Premiums received at least one but less than seven years ago.
(See page 26 of the prospectus for a more detailed discussion.) You may have to
pay taxes on amounts you withdraw and there may also be a 10% tax penalty if you
make withdrawals before you are 59 1/2 years old.

8. Past Investment Performance. The value of the money you allocate to the
Sub-Accounts will go up or down, depending on the investment performance of the
Portfolios you pick. The following chart shows the past investment performance
on a year by year basis for each Sub-Account. These figures have already been
reduced by the insurance charges, the policy fee, the fund manager's fee and all
the expenses of the mutual fund Portfolio. But these figures do not include the
withdrawal charge, which would reduce performance if it applied. Remember, past
performance is no guarantee of future performance or earnings.

CALENDAR YEAR

PORTFOLIO/

SUB-ACCOUNT 1996 1995 1994 1993 1992 1991 1990 1989
- ----------- ---- ---- ---- ---- ---- ---- ---- ----

<S> <C> <C> <C> <C> <C> <C> <C>
Money Market(1) 3.53% 4.21% 3.00% 1.86% 2.71% 4.54% N/A N/A

Special (5.67%) (0.48%) (3.48%) 26.74% (0.41%) 8.99% N/A N/A
Value
(1)

Zero Coupon 2000(1) 1.10% 16.35% (5.41%) 13.52% 7.29% 17.14% 6.28% N/A

Quality Bond(1) 1.63% 18.91% (6.17%) 13.66% 10.45% 12.47% N/A N/A

Small Cap(1) 15.06% 28.84% 4.95% 65.77% 68.98% 156.07% N/A N/A

Capital 22.71% 32.82% 1.45% N/A N/A N/A N/A N/A
Appreciation(2)

Stock Index(3) 19.80% 35.92% (0.60%) 7.75% 5.55% 27.98% (6.52%) N/A

<PAGE>

Growth and 18.63% 59.58% N/A N/A N/A N/A N/A N/A
Income(5)

International 9.82% 6.62% N/A N/A N/A N/A N/A N/A
Equity(5)

</TABLE>

(1) Portfolio Inception 8-31-90 (3) Portfolio Inception 9-29-89
(2) Portfolio Inception 4-5-93 (4) Portfolio Inception 10-7-93
(5) Portfolio Inception 12-15-94

Data is for full years only. Therefore, no performance is reported for the
International Value, Disciplined Stock and Small Company Stock Sub-Accounts
because these Sub-Accounts had not been in operation for a full year in 1996.
Additionally, the Balanced and Limited Term High Income Sub-Accounts did not
commence operations in 1996 and, therefore, no performance is reported for these
Sub-Accounts. The figures for the Money Market, Special Value, Zero Coupon 200,
Quality Bond, Small Cap and Stock Index Sub-Accounts include data for periods
before the Sub-Accounts commenced operations, based on the actual performance of
the corresponding Portfolios since they commenced operation.

9. Death Benefit. If you or the annuitant die during the accumulation
phase, the beneficiary will receive
a Death Benefit.

If death occurs before age 85, the death benefit will be the greatest
of: (1), the Policy Value; (2) the Premiums you've paid, less any amounts you
have withdrawn (less any premium taxes applicable to those withdrawal's); or (3)
the highest Policy Value on any anniversary of your purchase of the Policy up to
the Owner's or Annuitant's age 75 (adjusted for additional investments and
withdrawals since that anniversary, and less premium taxes). After age 85, the
death benefit is the Policy Value.

10. Other Information. The Policy offers other features you might be
interested in.
These features may not be suitable for your particular situation. Some of these
features include:

FREE LOOK. After you get your Policy, you have ten days to look it over
and decide if it is really right for you. If you decide not to keep the Policy,
you can cancel it during this period, and you will get back your full Policy
Value (this may be more or less than your investment) and no withdrawal charge
will be deducted.

DOLLAR COST AVERAGING. You can instruct Transamerica to automatically
transfer amounts from the Premiums you allocated to the Money Market, Quality
Bond or Limited Term High Income Sub-Accounts to any of the other Sub-Accounts
each month. Dollar Cost Averaging is intended to give you a lower average cost
per share or unit than a single, one time investment, but does not assure a
profit or protect against loss and is intended to continue for some time period.

AUTOMATIC ASSET REBALANCING. The performance of each Sub-Account may
cause the allocation of value among the Sub-Accounts to change. You may instruct
Transamerica to periodically automatically rebalance the amounts in the
Sub-Accounts by reallocating amounts among them.

SYSTEMATIC WITHDRAWAL OPTION. You can arrange to have Transamerica send
you money automatically each month out of your Policy Value during the
accumulation phase. There are limits on the amounts, but the withdrawal charge
will not apply (the payments may be taxable and subject to the penalty tax if
you are under age 59 1/2 ).

AUTOMATIC PAYOUT OPTION. Certain pension and retirement plans require
that certain amounts be distributed from the plan at certain ages. You can
arrange to have such amounts distributed automatically during the accumulation
phase.

<PAGE>

11. INQUIRIES. You can get more information and have your questions
answered by writing or calling:

Transamerica Annuity Service Center
P.O. Box 31728
Charlotte, North Carolina 28231-1728
(800) 258-4261

<PAGE>

["Front Maroon Cover"]

PROSPECTUS FOR

DREYFUS/TRANSAMERICA TRIPLE ADVANTAGE(R)

May 1, 1997, revised October 1, 1997

A Variable Annuity Issued by
Transamerica Life Insurance Company
of New York

Including Fund Prospectuses for

DREYFUS VARIABLE INVESTMENT FUND

May 1, 1997, revised October 1, 1997

THE DREYFUS SOCIALLY RESPONSIBLE GROWTH FUND, INC.
May 1, 1997
DREYFUS STOCK INDEX FUND
May 1, 1997

<PAGE>

DREYFUS/TRANSAMERICA TRIPLE ADVANTAGE(R)
VARIABLE ANNUITY
Issued by
TRANSAMERICA LIFE INSURANCE COMPANY OF NEW
YORK 100 Manhattanville Road, Purchase New York
10577, (914) 701-6000

This Prospectus describes the Dreyfus/Transamerica Triple Advantage
Variable Annuity, a variable annuity policy ("Policy") issued by Transamerica
Life Insurance Company of New York (formerly called First Transamerica Life
Insurance Company) ("Transamerica"). The Policy is designed to aid individuals
in long-term financial planning and for retirement or other long-term purposes.

The Policy Value will accumulate on a variable basis in Transamerica
Separate Account VA-2LNY (the "Variable Account").

The Owner bears the entire investment risk under this Policy. There is
no guaranteed or minimum withdrawal value; the Cash Surrender Value or Annuity
Purchase Amount could be less than the Premiums invested in the Policy.
-------

This Prospectus sets forth the basic information that a prospective
investor should know before investing. A "Statement of Additional Information"
containing more detailed information about the Policy is available free by
writing Transamerica Life Insurance Company of New York, Annuity Service Center,
at P.O. Box 31728, Charlotte, North Carolina 28231-1728 or by calling (800)
258-4261. The Statement of Additional Information, which has the same date as
this Prospectus, as it may be supplemented from time to time, has been filed
with the Securities and Exchange Commission and is incorporated herein by
reference. 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 NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Please read this prospectus carefully and retain it for
future reference. The date of this Prospectus is May
1, 1997, revised October 1, 1997

This Prospectus must be accompanied by current Prospectuses for Dreyfus Variable
Investment Fund, Dreyfus Stock Index Fund, and The Dreyfus Socially Responsible
Growth Fund, Inc.

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.

An investment in the Policy is not a deposit or obligation of, or guaranteed or
endorsed by, any bank, nor is the Policy federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board or any other government
agency. Investing in the Policy involves certain investment risks, including
possible loss of principal.

<PAGE>

The Policy provides for monthly Annuity Payments to be made by
Transamerica on a fixed or a variable or combination of a fixed and variable
basis for the life of the Annuitant or for some other period, beginning on the
first day of the month following the Annuity Date selected by the Owner. Prior
to the Annuity Date, the Owner can transfer amounts among the Sub-Accounts of
the Variable Account. Some prohibitions and restrictions apply. After the
Annuity Date, some transfers are permitted among the Sub-Accounts if the Owner
selects a Variable Annuity Payment Option. Before the Annuity Date, the Owner
can also elect to withdraw all or a portion of the Cash Surrender Value in
exchange for a cash payment from Transamerica; however, withdrawals may be
subject to a Contingent Deferred Sales Load, premium taxes, federal tax and/or a
tax penalty and, upon surrender, the annual Policy Fee will also be deducted.

The Variable Account is divided into Sub-Accounts. Each Sub-Account is
invested in shares of a specific Portfolio. Fifteen Portfolios are available for
investment under the Policies: Money Market, Special Value, Zero Coupon 2000,
Quality Bond, Small Cap, Capital Appreciation, Growth and Income, International
Equity, International Value, Disciplined Stock, Small Company Stock, Balanced
and Limited Term High Income Portfolios of Dreyfus Variable Investment Fund;
Dreyfus Stock Index Fund; and The Dreyfus Socially Responsible Growth Fund, Inc.
Certain fees and expenses are charged against the assets of each Portfolio. The
Policy Value and the amount of any Variable Annuity payments will vary to
reflect the investment performance of the Sub-Account(s) selected by the Owner
and the deduction of the Policy charges described under "Charges and Deductions"
on page 26. For more information about the Funds, see "The Funds" on page 17 and
the accompanying Funds' prospectuses.
The Initial Premium for the Policy must generally be at least $5,000
unless, with the prior permission of Transamerica, the Policy is sold as a
Qualified Policy to certain retirement plans. Generally, each additional Premium
must be at least $500, unless an automatic payment plan is selected. The prior
approval of Transamerica is required before total Premiums for any Policy in
excess of $1,000,000 will be accepted.

<PAGE>

TABLE OF CONTENTS
Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
CONDENSED FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . . . . 13
PERFORMANCE DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
TRANSAMERICA LIFE INSURANCE COMPANY OF NEW YORK
AND THE VARIABLE ACCOUNT. . . . . . . . . . . . . . . . . . . . . . . . 17
Transamerica Life Insurance Company of New York17
Published Ratings17
The Variable Account17
THE FUNDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Addition, Deletion or Substitution20
THE POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
POLICY APPLICATION AND PREMIUMS. . . . . . . . . . . . . . . . . . . . . 21
Premiums21
Allocation of Premiums21
POLICY VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
TRANSFERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Before the Annuity Date22
Possible Restrictions23
Dollar Cost Averaging23
Automatic Asset Rebalancing23
After the Annuity Date24
CASH WITHDRAWALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Withdrawals24
Systematic Withdrawal Option25
Automatic Payout Option25
DEATH BENEFIT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Payment of Death Benefit26
Designation of Beneficiaries26
Death of Annuitant Prior to the Annuity Date26
Death of Owner Prior to the Annuity Date26
Death of Annuitant or Owner After the Annuity Date26
CHARGES AND DEDUCTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 26
Contingent Deferred Sales Load27
Administrative Charges28
Mortality and Expense Risk Charge28
Premium Taxes28
Transfer Fee29
Systematic Withdrawal Option29
Taxes. 29
Portfolio Expenses29
ANNUITY PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Annuity Date29
Annuity Payment29
Election of Annuity Forms and Payment Options30
Annuity Payment Options30
Fixed Annuity Payment Option30
Variable Annuity Payment Option30
Annuity Forms30
Alternate Fixed Annuity Rates31
QUALIFIED POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Withholding32
Automatic Payout Option32
Restrictions under 403(b) Programs33
FEDERAL TAX MATTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Introduction33
Taxation of Annuities33
Qualified Policies35
Possible Change in Taxation36
Other Tax Consequences36
General36
DISTRIBUTION OF THE POLICY . . . . . . . . . . . . . . . . . . . . . . . 36
LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
LEGAL MATTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
ACCOUNTANTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
VOTING RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . 38
STATEMENT OF ADDITIONAL INFORMATION - TABLE OF CONTENTS. . . . . . . . . 39
APPENDIX A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A-1
Example of Variable Accumulation Unit Value CalculationsA-1
Example of Variable Annuity Unit Value CalculationsA-1
Example of Variable Annuity Payment CalculationsA-1

This Policy is available only in New York.

<PAGE>

DEFINITIONS

Active Sub-Account: A Sub-Account of the Variable Account in which the Policy
has current value.

Annuitant: The person: (a) whose life is used to determine the amount of monthly
annuity payments on the Annuity Date; and (b) who is the Payee designated to
receive monthly annuity payments, unless such Payee is changed by the Owner. The
Annuitant cannot be changed after the Policy has been issued, except upon the
Annuitant's death prior to the Annuity Date if a Contingent Annuitant has
previously been named. In the case of a Qualified Policy used to fund an IRA or
a 403(b) annuity, the Owner must be the Annuitant. Annuitant's Beneficiary: The
person(s) named by the Owner who may receive the Death Benefit under the Policy,
if: (a) the Annuitant is not the Owner, there is no named Contingent Annuitant
and the Annuitant dies before the Annuity Date and before the death of the
Owner(s); or (b) the Annuitant dies after the Annuity Date under an Annuity Form
containing a period certain option. Annuity Date: The date on which the Annuity
Purchase Amount will be applied to provide monthly annuity payments under the
Annuity Form and Payment Option selected by the Owner. Monthly annuity payments
will start the first day of the month immediately following the Annuity Date.
Unless the Annuity Date is changed as allowed by the Policy, the Annuity Date
will be as shown in the Policy. The Annuity Date may be changed by the Owner
upon 30 days advance written notice to our Service Office. The revised Annuity
Date may not be earlier than the first day of the calendar month coinciding with
or next following the third Policy Anniversary. The Annuity Date may not be
later than the first day of the calendar month immediately preceding the month
of the Annuitant's 85th birthday. Annuity Payment: An amount paid by
Transamerica at regular intervals to the Annuitant and/or any other Payee. It
may be on a variable or fixed basis. Annuity Purchase Amount: The amount applied
as a single premium to provide an annuity under the Annuity Form and Payment
Options available under the Policy. The Annuity Purchase Amount is equal to the
Policy Value, less any applicable Contingent Deferred Sales Load, and less any
applicable premium taxes. In determining the Annuity Purchase Amount,
Transamerica will waive the Contingent Deferred Sales Load if the Annuity Form
involves life contingencies and the Annuity Date occurs on or after the third
Policy Anniversary. Annuity Year: A one-year period starting on the Annuity Date
and, after that, each succeeding one-year period. Cash Surrender Value: The
amount payable to the Owner if the Policy is surrendered on or before the
Annuity Date. The Cash Surrender Value is equal to the Policy Value, less the
Policy Fee, less any applicable Contingent Deferred Sales Load, and less
applicable premium taxes. Code: The U.S. Internal Revenue Code of 1986, as
amended, and the rules and regulations issued thereunder. Contingent Annuitant:
The person who: (a) becomes the Annuitant if the Annuitant dies before the
Annuity Date; or (b) may receive benefits under the Policy if the Annuitant dies
after the Annuity Date under an Annuity Form containing a contingent annuity
option. A Contingent Annuitant may be designated only if the Owner is not also
the Annuitant. The Contingent Annuitant may be changed at any time by the Owner
while the Annuitant is living and before the Annuity Date. Fixed Annuity: An
annuity with predetermined payment amounts. Free Look Period: The period of
time, currently 10 days, beginning when the Owner has received the Policy,
during which the Owner has the right to cancel the Policy. Funds: Dreyfus
Variable Investment Fund, Dreyfus Stock Index Fund and The Dreyfus Socially
Responsible Growth Fund, Inc. in which the Variable Account currently invests.
Inactive Sub-Account: A Sub-Account of the Variable Account in which the Policy
has a zero balance. Net Investment Factor: An index that measures the investment
performance of a Sub-Account from one Valuation Period to the next. Net Premium:
A Premium reduced by any applicable premium tax (including retaliatory premium
taxes). Non-Qualified Policy: A Policy other than a Qualified Policy. Owner
(Joint Owners): The person or persons who, while living, control(s) all rights
and benefits under the Policy. Joint Owners own the Policy equally with the
right of survivorship. The right of survivorship means that if a Joint Owner
dies, his or her interest in the policy will pass to the surviving Joint Owner
in accordance with the Death Benefit provision. Qualified Policies may not have
Joint Owners. Owner's Beneficiary: The person who becomes the Owner of the
Policy if the Owner dies. If the Policy has Joint Owners, the surviving Joint
Owner will be the Owner's Beneficiary. Payee: The person who receives the
Annuity Payments after the Annuity Date. The Payee will be the Annuitant, unless
otherwise changed by the Owner.

<PAGE>

Policy Anniversary: The same month and day as the Policy Date in each calendar
year after the calendar year in which the Policy Date occurs.
Policy Date: The effective date of the Policy as shown on the Policy.

Policy Value: The total dollar amount of all Variable Accumulation Units in each
Sub-Account of the Variable Account held for the Policy prior to the Annuity
Date. The Policy Value is equal to: (a) Net Premiums; plus or minus (b) any
increase or decrease in the value of the Sub-Accounts due to investment results;
less (c) the daily Mortality and Expense Risk Charge; less (d) the daily
Administrative Expense Charge; less (e) the annual Policy Fees (taken at the end
of each Policy Year); less (f) any applicable Transfer Fees; and less (g) any
withdrawals from the Sub-Accounts. Policy Year: The 12-month period from the
Policy Date and ending with the day before the first Policy Anniversary and each
twelve month period thereafter. The first Policy Year for any particular Net
Premium is the Policy Year in which the Premium is received by the Service
Center. Portfolio: Dreyfus Stock Index Fund, The Dreyfus Socially Responsible
Growth Fund, Inc., or any one of the Series of Dreyfus Variable Investment Fund
underlying a Sub-Account of the Variable Account. Proof of Death: May be: (a) a
copy of a certified death certificate; (b) a copy of 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
satisfactory to Transamerica. Qualified Policy: A Policy used in connection with
an individual retirement annuity which receives favorable federal income tax
treatment under Section 408 of the Code and whose initial Premium is derived
from a rollover of amounts from a qualified retirement plan(s) receiving special
tax treatment under Sections 401(a), 403(b) or 408 of the Code (a "rollover
IRA") or, with Transamerica's prior permission, an IRA which receives special
tax treatment under Section 408 of the Code and whose initial Premium is limited
by the contribution limits of the Code (a "contributory IRA"), an annuity under
Section 403(b) of the Code, or a qualified pension, retirement or profit-sharing
plan which receives special tax treatment under Section 401(a) of the Code.
Receipt: Receipt and acceptance by Transamerica at its Service Center. Series:
Any of the portfolios of Dreyfus Variable Investment Fund available for
investment by a Sub-Account under the Policy. Service Center: Transamerica's
Annuity Service Center, at P.O. Box 31728, Charlotte, North Carolina 28231-1728
and at telephone (800) 258-4261. Socially Responsible Fund: The Dreyfus Socially
Responsible Growth Fund, Inc., a diversified open-end management investment
company. Stock Index Fund: Dreyfus Stock Index Fund, a non-diversified open-end
management investment company. Sub-Account: A subdivision of the Variable
Account investing solely in shares of one of the Portfolios. Valuation Day: Any
day the New York Stock Exchange is open for trading and that is a regular
business day for our Service Center. Valuation occurs currently as of 4:00 p.m.
ET each Valuation Day. Valuation Period: The time interval between the closing
of the New York Stock Exchange on consecutive Valuation Days. Variable Account:
Separate Account VA-2LNY, a separate account established and maintained by
Transamerica for the investment of a portion of its assets pursuant to Section
4240 of the New York Insurance Law and Regulation 47 (part 50). The Variable
Account contains several Sub-Accounts to which all or portions of Net Premiums
and transfers may be allocated. Variable Accumulation Unit: A unit of measure
used to determine the Policy Value prior to the Annuity Date. The value of a
Variable Accumulation Unit varies with each Sub-Account. Variable Annuity: An
annuity with payments which vary as to dollar amount in relation to the
investment performance of specified Sub-Accounts of the Variable Account.
Variable Annuity Unit: A unit of measure used to determine the amount of the
second and each subsequent payment under a Variable Annuity Payment Option. The
value of a Variable Annuity Unit varies with each Sub-Account. Variable Fund:
Dreyfus Variable Investment Fund, an open-end management investment company.
Withdrawals: Refers to partial withdrawals, full surrenders, and systematic
withdrawals that are paid in cash to the Owner or person(s) specified by the
Owner. Written Notice (or Written Request): A notice or request in writing by
the Owner to Transamerica's Service Center. Such a request must contain original
signatures; no carbons or photocopies will be accepted. Transamerica reserves
the right to accept a facsimile copy.

<PAGE>

SUMMARY

The Policy

The Flexible Premium Multi-Funded Deferred Annuity Policy (the
"Policy") described in this Prospectus is designed to aid individuals in
long-term financial planning and for retirement or other long-term purposes. The
Policy may be used with non-qualified plans and as an individual retirement
annuity, that qualifies for special tax treatment under Section 408 of the Code,
and whose initial Premium is a rollover of amounts from a qualified retirement
plan(s) receiving special tax treatment under Sections 401(a), 403(b) and 408 of
the Code, (a "rollover IRA"). Additionally, with Transamerica's prior
permission, the Policy may be used as an IRA whose initial Premium is limited to
the contribution limitations of the Code (a "contributory IRA"), as an annuity
under Section 403(b) of the Code and with various types of qualified pension and
profit-sharing plans under Section 401(a) of the Code. The Policy is issued by
Transamerica Life Insurance Company of New York (formerly called First
Transamerica Life Insurance Company) ("Transamerica"), a wholly-owned subsidiary
of Transamerica Occidental Life Insurance Company, having its principal office
at 100 Manhattanville Road, Purchase New York 10577, telephone (914) 701-6000.
The change in name to Transamerica Life Insurance Company of New York is
effective May 1, 1997.

The Policy provides that the Policy Value, after certain adjustments,
will be applied to an Annuity Form and Payment Option on a selected future date
(see "Annuity Date", page 29).
The Policy Value will depend on the investment experience of each
Sub-Account of the Variable Account selected by the Owner. All payments and
values provided under the Policy when based on the investment experience of the
Variable Account are variable and are not guaranteed as to dollar amount.
Therefore, prior to the Annuity Date the Owner bears the entire investment risk
under the Policy.
There is no guaranteed or minimum Cash Surrender Value, so the proceeds
of a surrender could be less than the total Premiums.

The Initial Premium for each Policy must generally be at least $5,000
unless, with Transamerica's permission, the Policy is sold as a Qualified Policy
to certain retirement plans. Generally, each additional Premium must be at least
$500 (unless an automatic payment plan is selected). In no event, however, may
the total of all Premiums under a Policy exceed $1,000,000 without the prior
approval of Transamerica. The minimum Net Premium that may be allocated

to an Inactive Sub-Account is $500 and to a new Guarantee Period is $1,000.
(See "Policy Application and Premiums" page 21.)
The Variable Account

The Variable Account is a separate account (Separate Account VA-2LNY)
that is subdivided into Sub-Accounts. (See "The Variable Account" page 17.)
Assets of each Sub-Account are invested in a specified mutual fund Portfolio.
Each Sub-Account uses its assets to purchase, at their net asset value, shares
of a specific Series of Dreyfus Variable Investment Fund or shares in Dreyfus
Stock Index Fund or in The Dreyfus Socially Responsible Growth Fund, Inc.
(together "The Funds"). The following fifteen Portfolios are currently available
for investment in the Variable Account. Prior to October 1, 1997, the Special
Value Portfolio was called Managed Assets Portfolio.

Money Market Capital Appreciation International Value
Special Value
Stock Index Disciplined Stock
Zero Coupon 2000 Socially Responsible Growth Small Company Stock
Quality Bond Growth and Income Balanced
Small Cap International Equity Limited Term High Income

The Funds pay their investment adviser and administrators certain fees
charged against the assets of each Portfolio. The Policy Value, if any, of a
Policy and the amount of any Variable Annuity Payments will vary to reflect the
investment performance of all of the Sub-Accounts selected by the Owner and the
deduction of the charges described under "Charges and Deductions" on page 26.
For more information about the Funds, see "The Funds" page 17 and the
accompanying Funds' prospectuses. Transfers Before the Annuity Date

Prior to the Annuity Date, the Owner may make up to 18 transfers
between and among the Sub-Accounts of the Variable Account. A "transfer" is the
reallocation of amounts among the Sub-Accounts of the Variable Account. All
reallocations on any one day are considered one transfer. Total transfers are
limited to eighteen during a Policy Year. This limit includes all transfers
except those specifically excluded under certain programs. (See "Transfers" on
page 22.)

<PAGE>

Transamerica currently does not impose a Transfer Fee, but it reserves
the right to charge a Transfer Fee for each
transfer in excess of twelve made during the same Policy Year. (See "Transfer
Fee" page 28.) (For Transfers after the
Annuity Date, see "After the Annuity Date" page 23.)
Withdrawals

All or part of the Cash Surrender Value for a Policy may be withdrawn
by the Owner on or before the Annuity Date. However, amounts withdrawn may be
subject to a Contingent Deferred Sales Load. (See "Contingent Deferred Sales
Load" page 26.) Amounts withdrawn may be subject to a premium tax or similar
tax, depending upon the state in which the Owner lives. Withdrawals may further
be subject to any federal, state or local income tax, and subject to a penalty
tax and Qualified Policies may be subject to severe restrictions. (See
"Qualified Policies" page 31 and "Federal Tax Matters" page 32.) (Except for
rollover IRA's, Qualified Policies are sold only with Transamerica's prior
permission.) The annual Policy Fee generally will be deducted on a full
surrender of a Policy. (See "Cash Withdrawals" page 24 for additional
limitations regarding withdrawals.) Contingent Deferred Sales Load

Transamerica does not deduct a sales charge from Premiums (although
premium taxes may be deducted). However, if any part of the Policy Value is
withdrawn, a Contingent Deferred Sales Load of up to 6% of Premiums withdrawn
may be assessed by Transamerica to cover certain expenses relating to the sale
of the Policies, including commissions to registered representatives and other
promotional expenses. TRANSAMERICA GUARANTEES THAT THE AGGREGATE CONTINGENT
DEFERRED SALES LOAD WILL NEVER EXCEED 6% OF THE PREMIUMS. After a Premium has
been held by Transamerica for seven Policy Years, the remaining Premium may be
withdrawn without charge.

Transamerica deducts a daily charge (the "Mortality and Expense Risk
Charge") equal to a percentage of the value of the net assets in the Variable
Account for the mortality and expense risks assumed. The effective annual rate
of this charge is 1.25% of the value of the net assets in the Variable Account
attributable to the Policies. (See "Mortality and Expense Risk Charge" page 28.)
TRANSAMERICA GUARANTEES THAT THIS MORTALITY AND EXPENSE RISK CHARGE WILL NOT BE
INCREASED.
Transamerica also deducts a daily charge (the "Administrative Expense
Charge") equal to a percentage of the value of the net assets in the Variable
Account corresponding to an effective annual rate of 0.15% to help cover some of
the costs of administering the Policy and the Variable Account. This charge may
change, but it is guaranteed not to exceed a maximum effective annual rate of
0.25%. (See "Administrative Charges" page 27).
There is also an administrative charge (the "Policy Fee") each year for
Policy maintenance. This fee is currently $30 (or 2% of the Policy Value, if
less) but will not be assessed for Policy Years in which the Policy Value
exceeds $50,000 on the last business day of the Policy Year or as of the date
the Policy is surrendered. The Policy Fee will be deducted at the end of the
Policy Year or when the Policy is surrendered, if earlier. The Policy Fee may
change but it is guaranteed not to exceed $60 (or 2% of the Policy Value, if
less) per Policy Year. After the Annuity Date this fee is referred to as the
Annuity Fee. The Annuity Fee is $30 and will not change. (See "Administrative
Charges" page 27.)
Currently, no Transfer Fees are imposed. However, for each transfer in
excess of twelve during a Policy Year, a Transfer Fee may be imposed equal to
the lesser of $10 or 2% of the amount transferred. (See "Transfer Fee" page 28.)

<PAGE>

Also, New York currently has no premium tax nor retaliatory premium
tax. If New York imposes these taxes in the
future, or if the Owner is or becomes a resident of a state other than New York
where such taxes apply, the charges could
be deducted from Premiums and/or from the Annuity Purchase Amount upon
annuitization. (See "Premium Taxes" page 28.)
Variable Account Fee Table
The purpose of this table is to assist in understanding the various
costs and expenses that the Owner will bear directly and indirectly. The table
reflects expenses of the Variable Account as well as of the Portfolios. The
table assumes that the entire Policy Value is in the Variable Account. The
information set forth should be considered together with the narrative provided
under the heading "Charges and Deductions" on page 26 of this Prospectus, and
with the Funds' prospectuses. In addition to the expenses listed below, premium
taxes may be applicable.
<TABLE>
<CAPTION>

Policy Transaction Expenses(1)
<S> <C>
Sales Load Imposed on Premiums 0
Maximum Contingent Deferred Sales Load(2) 6%

- ---------------------------------------------------------------------------------------------------------------------------

Range of Contingent Deferred Sales Load Over Time
Contingent Deferred

Policy Years since Sales Load
Premiums Receipt Percentage

Less than 2 years 6%
2 years but less than 4 years 5%
4 years but less than 6 years 4%
6 years but less than 7 years 2%
7 or more 0%
- ---------------------------------------------------------------------------------------------------------------------------

Transfer Fee(3) 0
Systematic Withdrawal Fee(3) 0
Policy Fee(4) $30

Variable Account Annual Expenses(1)
Mortality and Expense Risk Charges 1.25%
Administrative Expense Charge(5) 0.15%
Other Fees and Expenses of the Variable Account 0.00%
Total Variable Account Annual Expenses 1.40%

</TABLE>
<TABLE>
<CAPTION>

Zero Stock

Portfolio Money Special Coupon Quality Small Capital Index
- ---------
Annual Expenses(6) Market Value 2000 Bond Cap Appreciation Fund(6)
- ------------------- ------ ----- ---- ---- --- ------------ ----
(as a percentage of Portfolio
average net assets)

<S> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.50% 0.75% 0.45% 0.65% 0.75% 0.75% 0.24%
Other Expenses 0.12% 0.18% 0.21% 0.14% 0.04% 0.09% 0.05%
Total Portfolio Annual 0.62% 0.93% 0.66% 0.79% 0.79% 0.84% 0.30%
Expenses

Socially Growth Small
Portfolio Responsible and International International Disciplined Company
Annual Expenses(6) Fund(6) Income Equity Value(6)(7) Stock(6)(7) Stock(6)(7)
(as a percentage of Portfolio
average net assets)
Management Fees 0.72% 0.75% 0.75% 0.66% 0.59% 0.56%
Other Expenses 0.24% 0.08% 0.53% 0.35% 0.21% 0.19%
Total Portfolio Annual 0.96% 0.83% 1.28% 1.01% 0.80% 0.75%
Expenses

Portfolio Limited Term High

Annual Expenses(6) Balanced(6) Income Securities(6)
(as a percentage of Portfolio
average net assets)
Management Fees 0.75% 0.65%
Other Expenses 0.50% 0.35%
Total Portfolio Annual 1.25% 1.00%
Expenses

</TABLE>
9

<PAGE>

Expense information regarding the Portfolios has been provided by the Funds.
Transamerica has no reason to doubt the accuracy of that information, but
Transamerica has not verified those figures. In preparing the table above and
the examples that follow, Transamerica has relied on the figures provided by the
Funds. Actual expenses in future years may be higher or lower than the figures
above.

Notes to Fee Table:

(1) The Policy Transaction Expenses apply to each Policy, regardless of how
Policy Value is allocated between the Variable Account and the Fixed
Account. The Variable Account Annual Expenses do not apply to the Fixed
Account.
(2) A portion of the Premiums may be withdrawn each year after the first
Policy Year without imposition of any Contingent Deferred Sales Load;
after a Premium has been held by Transamerica for seven Policy Years,
the remaining may be withdrawn free of any Contingent Deferred Sales
Load ("CDSL"); accumulated earnings may always be withdrawn without
imposition of a CDSL. (See "Contingent Deferred Sales Load" page 26.)
(3) Transamerica currently does not impose a Transfer Fee. However, a
Transfer Fee of $10 may be imposed for each transfer in excess of six in
a Policy Year. Transamerica may also impose a fee (of up to $25 per
year) if the systematic withdrawal option is elected. (See "Charges
and Deductions" page 26.)
(4) The current annual Policy Fee is $30 (or 2% of the Policy Value, if
less) per Policy Year. The fee may be changed annually, but it may not
exceed $60 (or 2% of the Policy Value, if less). (See "Charges and
Deductions" page 26.)
(5) The current annual Administrative Expense Charge is 0.15%; it may be
increased to 0.25%. The total of the charges described in notes (2), (3)
and (4) will never exceed the anticipated or estimated costs to
administer the Policy and the Variable Account. (See "Charges and
Deductions" page 26.)

(6) From time to time, the Portfolios' investment adviser, in its sole
discretion, may waive all or part of their fees and/or voluntarily
assume certain Portfolio expenses. For fiscal year 1996, certain fees
were waived or expenses assumed, in each case on a voluntary basis.
With such waivers or reimbursements, the Management Fees, Other
Expenses and Total Portfolio Annual Expenses that were paid for the
last completed fiscal year, December 31, 1996, for the Socially
Responsible Fund were 0.72%, 0.24% and 0.96%. The International Value,
Disciplined Stock, and Small Company Stock Portfolios did not commence
operations until April 30, 1996. The Management Fee, Other Expenses and
Total Portfolio Annual Expenses that were paid, on an annualized basis
because of such waivers or reimbursements, for the last completed
fiscal year, December 31, 1996, for these Portfolios were:
International Value: 0.66%, 0.35%, 1.01%; Disciplined Stock: 0.59%,
0.21%, 0.80%; and Small Company Stock: 0.56%; 0.19%; and 0.75%. During
calendar year 1997, the adviser has under taken to waive fees and
reimburse expenses as follows: Stock Index with a cap at 0.40%;
Balanced with a cap of 1.25% on an annualized basis; and Limited Term
High Income with a cap of 1% on an annualized basis. For a more
complete description of the Portfolios' fees and expenses, see the
Funds' prospectuses.
(7) The International Value, Disciplined Stock and Small Company Stock
Portfolios did not commence operations until April 30, 1996. These
numbers show the expenses annualized as though the Portfolio had been
in operation throughout 1996.
(8) The Balanced and Limited Term High Income Portfolios did not commence
operations during 1996. These numbers are annualized estimates of the
expenses that each of these Portfolios expects to incur with waivers
and reimbursements during fiscal year 1997.

<PAGE>

Examples*

The following three examples reflect no Policy Fee deduction because
the approximate average Policy Value is more than $50,000 and the Policy Fee is
waived for Policy Value over $50,000.

These examples all assume no Transfer Fees, systematic withdrawal fee
or premium tax have been assessed. Premium
taxes may be applicable. (See "Premium Taxes" page 28.)
These examples show expenses without reflecting fee waivers and
reimbursements for 1996. Except for the Stock Index, Balanced and Limited Term
High Income Portfolios, it is not anticipated that there will be any fee waivers
or expense reimbursements in the future.

Example 1
If the Owner surrenders the Policy at the end of the applicable time
period, he/she would pay the following expenses on a $1,000 Initial Premium
assuming a 5% annual return on assets:

Sub-Account One Year Three Years Five Years Ten Years
- ----------- -------- ----------- ---------- ---------
<S> <C> <C> <C> <C>
Money Market $76.29 $112.96 $148.80 $234.80
Special Value $79.21 $121.85 $164.53 $266.60
Zero Coupon 2000 $76.67 $114.11 $150.84 $238.97
Quality Bond $77.89 $117.85 $157.46 $252.37
Small Cap $77.89 $117.85 $157.46 $252.37
Capital Appreciation $78.37 $119.28 $159.99 $257.48
Stock Index $73.26 $103.57 $132.30 $200.86
Socially Responsible $79.78 $123.57 $167.55 $272.63
Growth and Income $78.27 $118.99 $159.48 $256.46
International Equity $82.50 $131.80 $181.99 $301.24
International Value $83.16 $133.77 $185.45 $308.01
Disciplined Stock $79.50 $122.71 $166.04 $269.62
Small Company Stock $79.31 $122.14 $165.03 $267.60
Balanced $82.22 $130.95 $180.51 $298.32
Limited Term High Income $79.87 $123.85 $168.05 $273.63

</TABLE>

Example 2
If the Owner does not surrender and does not annuitize the Policy,
he/she would pay the following expenses on a $1,000 Initial Premium assuming a
5% annual return on assets:
<TABLE>
<CAPTION>

Sub-Account One Year Three Years Five Years Ten Years
- ----------- -------- ----------- ---------- ---------
<S> <C> <C> <C> <C>
Money Market $20.50 $63.35 $108.80 $234.80
Special Value $23.61 $72.74 $124.53 $266.60
Zero Coupon 2000 $20.90 $64.57 $110.84 $238.97
Quality Bond $22.21 $68.51 $117.46 $252.37
Small Cap $22.21 $68.51 $117.46 $252.37
Capital Appreciation $22.71 $70.02 $119.99 $257.48
Stock Index $17.28 $53.57 $92.30 $200.86
Socially Responsible $24.21 $74.55 $127.55 $272.63
Growth and Income $22.61 $69.72 $119.48 $256.46
International Equity $27.11 $83.23 $141.99 $301.24
International Value $27.81 $85.32 $145.45 $308.01
Disciplined Stock $23.91 $73.65 $126.04 $269.62
Small Company Stock $23.71 $73.04 $125.03 $267.60
Balanced $26.81 $82.34 $140.51 $298.32
Limited Term High Income $24.31 $74.85 $128.05 $273.63

</TABLE>

<PAGE>

Example 3
If the Owner elects to annuitize at the end of the applicable period
under an Annuity Form with life contingencies,** he/she would pay the following
expenses on a $1,000 Initial Premium assuming a 5% annual return on assets:
<TABLE>
<CAPTION>

Sub-Account One Year Three Years Five Years Ten Years
- ----------- -------- ----------- ---------- ---------
<S> <C> <C> <C> <C>
Money Market $76.29 $63.35 $108.80 $234.80
Special Value $79.21 $72.74 $124.53 $266.60
Zero Coupon 2000 $76.67 $64.57 $110.84 $238.97
Quality Bond $77.89 $68.51 $117.46 $252.37
Small Cap $77.89 $68.51 $117.46 $252.37
Capital Appreciation $78.37 $70.02 $119.99 $257.48
Stock Index $73.26 $53.57 $92.30 $200.86
Socially Responsible $79.78 $74.55 $127.55 $272.63
Growth and Income $78.27 $69.72 $119.48 $256.46
International Equity $82.50 $83.23 $141.99 $301.24
International Value $83.16 $85.32 $145.45 $308.01
Disciplined Stock $79.50 $73.65 $126.04 $269.62
Small Company Stock $79.31 $73.04 $125.03 $267.60
Balanced $82.22 $82.34 $140.51 $298.32
Limited Term High Income $79.87 $74.85 $128.05 $273.63

</TABLE>

* In preparing the examples above, Transamerica has relied on the data
provided by the Funds. Transamerica has no reason to doubt the accuracy
of that information, but Transamerica has not verified those figures.
** For annuitization under a form that does not include life contingencies, a
Contingent Deferred Sales Load may apply.

THESE EXAMPLES SHOULD NOT BE CONSIDERED REPRESENTATIONS OF PAST OR FUTURE
EXPENSES.
ACTUAL EXPENSES PAID MAY BE GREATER OR LESS THAN THOSE SHOWN, SUBJECT TO THE
GUARANTEES
IN THE POLICY. The assumed 5% annual return is only hypothetical. It is not a
representation of past or future returns.
Actual returns could be greater or less than this assumed rate.
Annuity Payments
Annuity Payments will be made either on a fixed basis or a variable
basis or a combination of a fixed and variable basis as the Owner selects. The
Owner has flexibility in choosing the Annuity Date for his or her Policy. In no
event may the Annuity Date be later than the first day of the month immediately
preceding the month of the Annuitant's 85th birthday nor earlier than the first
day of the month coinciding with or immediately following the third Policy
Anniversary. Annuity Payments will begin on the first day of the calendar month
following the Annuity Date. (See "Annuity Payments" page 29.)
Four Annuity Forms are available under the Policy: (1) Life Annuity;
(2) Life and Contingent Annuity; (3) Life
Annuity with Period Certain; and (4) Joint and Survivor Annuity. (See "Annuity
Forms" page 30.)
Payments on Death Before the Annuity Date
A death benefit is paid on the death of either the Owner or Annuitant
prior to the Annuity Date. If the deceased Owner or Annuitant, as applicable,
had not attained their 85th birthday, the death benefit for a Policy is the
greatest of (a) the Policy Value, (b) all Premiums paid to the Policy less
withdrawals and any premium taxes applicable to those withdrawals or (c) the
greatest Policy Anniversary Value prior to the earliest of the Annuitant's or
Owner's 75th birthday increased by Premiums paid since that Policy Anniversary
less withdrawals and any premium taxes applicable to those withdrawals. If the
deceased Owner or Annuitant, as applicable, had attained age 85, the death
benefit will be the Policy Value. The death benefit will generally be paid
within seven days of receipt of the required Proof of Death of the Owner or the
Annuitant and election of the method of settlement or as soon thereafter as
Transamerica has sufficient information about the Beneficiary to make the
payment, but if no settlement method is elected the death benefit will be paid
no later than one year from the date of death. No Contingent Deferred Sales Load
is imposed. The death benefit may be paid as either a lump sum or as an annuity.
(See "Death Benefit" page 25.) Federal Income Tax Consequences

An Owner who is a natural person generally should not be taxed on
increases in the Policy Value until a distribution under the Policy occurs
(e.g., a withdrawal or Annuity Payment) or is deemed to occur (e.g., a pledge,
loan, or assignment of a Policy). Generally, a portion (up to 100%) of any
distribution or deemed distribution is taxable as ordinary income. The taxable
portion of distributions is generally subject to income tax withholding unless
the recipient elects otherwise, except that mandatory withholding may apply for
certain Qualified Policies. In addition, a federal penalty tax may apply to
certain distributions or deemed distributions. (See "Federal Tax Matters" page
32.)

<PAGE>

Right to Cancel
The Owner has the right to examine the Policy for a limited period,
known as a "Free Look Period." The Owner can cancel the Policy by delivering or
mailing a written notice or by sending a telegram to (a) the agent through whom
the Policy was purchased or (b) the Service Center before midnight of the tenth
day after receipt of the Policy. Notice given by mail and the return of the
Policy by mail, properly addressed and postage prepaid, will be deemed by
Transamerica to have been made on the date postmarked. Transamerica will refund
the Policy Value determined as of the date the notice is postmarked within seven
days after receipt of such notice to cancel and the returned Policy. Questions
Any questions about procedures or the Policy will be answered by the
Transamerica Annuity Service Center ("Service Center") at P.O. Box 31728,
Charlotte, North Carolina 28231-1728 or call (800) 258-4261. All inquiries
should include the Policy Number and the Owner's and Annuitant's names.
NOTE: The foregoing summary is qualified in its entirety by the
detailed information in the remainder of this Prospectus and in the prospectuses
for Dreyfus Variable Investment Fund, Dreyfus Stock Index Fund, and The Dreyfus
Socially Responsible Growth Fund, Inc. which should be referred to for more
detailed information. With respect to Qualified Policies, it should be noted
that the requirements of a particular retirement plan, an endorsement to the
Policy, or limitations or penalties imposed by the Code or the Employee
Retirement Income Security Act of 1974, as amended,may impose limits or
restrictions on Premiums, Withdrawals, distributions, or benefits, or on other
provisions of the Policy. This Prospectus does not describe such limitations or
restrictions. (See "Federal Tax Matters" page 32.)

CONDENSED FINANCIAL INFORMATION

The following condensed financial information is derived from the
financial statements of the Variable Account. The data should be read in
conjunction with the financial statements, related notes, and other financial
information included in the Statement of Additional Information.

The following table sets forth certain information regarding the
Sub-Accounts for the period from commencement of business operations of the
Sub-Account through December 31, 1996. The Balanced and Limited Term High Income
Sub-Accounts are not included because these Sub-Accounts did not commence
operations during 1996. The Special Value Portfolio was called Managed Assets
Portfolio prior to October 1, 1997.

The Variable Accumulation Unit values and the number of Variable
Accumulation Units outstanding for each Sub-Account for the periods shown are as
follows:
<TABLE>
<CAPTION>

Year Ending December 31, 1993
-----------------------------------------------------------------

Money Special Zero Coupon Quality
Market Value 2000 Bond Small Cap

Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
(Inception 1/4/93)(Inception 1/4/93)(Inception 1/4/93)(Inception 1/4/93) (Inception 1/4/93)
Accumulation Unit Value
<S> <C> <C> <C> <C> <C>
at Beginning of Period $1.021 $12.797 $13.225 $12.310 $39.620
Accumulation Unit Value
at End of Period $1.018 $12.861 $13.373 $12.445 $37.702
Number of Accumulation
Units Outstanding
at End of Period 2,678,280.492 167,686.797 137,252.898 86,752.856 138,557.449

Capital Appreciation Stock IndexSocially Responsible
Sub-Account Sub-Account Sub-Account
(Inception- (Inception (Inception-
April 5, January 4, October 7,
1993) 1993 1993)
Accumulation Unit Value at
Beginning of Period $6.590 $16.590 $12.490
Accumulation Unit Value at
End of Period $13.160 $16.521 $13.364
Number of Accumulation Units
Outstanding at End of Period 44,612.892 32,543.274 3,555.254

</TABLE>
13

<PAGE>

Year Ending December 31, 1994
---------------------------------------------------------------------------------

Money Special Zero Coupon Quality
Market Value 2000 Bond Small Cap

Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
<S> <C> <C> <C> <C> <C>
at Beginning of Period $1.018 $12.861 $13.373 $12.445 $37.702
Accumulation Unit Value
at End of Period $1.048 $12.496 $12.672 $11.710 $40.064
Number of Accumulation
Units Outstanding
at End of Period 8,547,165.659 820,985.237 203,164.533 164,657.770 612,327.237

Capital Appreciation Stock Index Socially Responsible
Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
at Beginning of Period $13.160 $16.521 $13.364
Accumulation Unit Value
at End of Period $13.373 $16.437 $13.377
Number of Accumulation
Units Outstanding
at End of Period 285,264.827 190,496,641 24,435.402

</TABLE>
<TABLE>
<CAPTION>

Year Ending December 31, 1995
---------------------------------------------------------------------------------------------------------------

Money Special Zero Coupon Quality
Market Value 2000 Bond Small Cap

Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
<S> <C> <C> <C> <C> <C>
at Beginning of Period $1.048 $12.496 $12.672 $11.711 $40.064
Accumulation Unit Value
at End of Period $1.093 $12.292 $14.740 $13.908 $51.121
Number of Accumulation
Units Outstanding
at End of Period 9,084,943.487 666,488.480 351,788.006 454,139.991 817,445.023

Growth and Income International Equity
Sub-Account Sub-Account
Capital Appreciation Stock Index Socially Responsible (Inception (Inception
Sub-Account Sub-Account Sub-Account January 5, 1995 January 5, 1995
----------- ----------- ----------- --------------- ---------------
Accumulation Unit Value
at Beginning of Period $13.373 $16.437 $13.377 $12.235 $12.024
Accumulation Unit Value
at End of Period $17.610 $22.172 $17.752 $19.426 $12.964
Number of Accumulation
Units Outstanding
at End of Period 587,928.246 365,482.688 49,020.846 734,393.096 61,152.467

</TABLE>

<PAGE>

Year Ending December 31, 1996
---------------------------------------------------------------------------------------------------------

Money Special Zero Coupon Quality
Market Value 2000 Bond Small Cap

Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
<S> <C> <C> <C> <C> <C>
at Beginning of Period $1.093 $12.292 $14.740 $13.908 $51.121
Accumulation Unit Value
at End of Period $1.132 $11.682 $14.911 $14.142 $58.773
Number of Accumulation
Units Outstanding
at End of Period 10,392,468.634 489,733.637 396,886.829 664,469.782 1,000,594.786

International
Capital Appreciation Stock Index Socially Responsible Growth and Income Equity
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
at Beginning of Period $17.610 $22.172 $17.752 $19.426 $12.964
Accumulation Unit Value
at End of Period $21.802 $26.791 $21.221 $23.131 $14.267
Number of Accumulation
Units Outstanding
at End of Period 1,074,614.761 585,454.420 103,732.717 1,906,011.179 226,976.242

International Value Disciplined Stock Small Company Stock
Sub-Account Sub-Account Sub-Account
Accumulation Unit Value
at Beginning of Period $10.00 $10.00 $10.00
Accumulation Unit Value
at End of Period $10.244 $11.776 $10.772
Number of Accumulation
Units Outstanding
at End of Period 47,815.855 381,884.114 212,878.654

</TABLE>

Financial Statements for the Variable Account and Transamerica
The financial statements and reports of independent auditors for the
Variable Account and Transamerica are contained in the Statement of Additional
Information.

PERFORMANCE DATA

From time to time, Transamerica may advertise yields and average annual
total returns for the Sub-Accounts of the Variable Account. In addition,
Transamerica may advertise the effective yield of the Money Market Sub-Account.
These figures will be based on historical information and are not intended to
indicate future performance. The yield of the Money Market Sub-Account refers to
the annualized income generated by an investment in that Sub-Account over a
specified seven-day period. The yield is calculated by assuming that the income
generated for that seven-day period is generated each seven-day period 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 that Sub-Account is assumed to be reinvested. The effective yield
will be slightly higher than the yield because of the compounding effect of this
assumed reinvestment.
The yield of a Sub-Account (other than the Money Market Sub-Account)
refers to the annualized income generated by an investment in the Sub-Account
over a specified thirty-day period. The yield is calculated by assuming that the
income generated by the investment during that thirty-day period is generated
each thirty-day period over a twelve-month period and is shown as a percentage
of the investment.
The yield calculations do not reflect the effect of any Contingent
Deferred Sales Load or premium taxes that may be applicable to a particular
Policy. To the extent that the Contingent Deferred Sales Load is applicable to a
particular Policy, the yield of that Policy will be reduced. For additional
information regarding yields and total returns calculated using the standard
formats briefly described herein, please refer to the Statement of Additional
Information.

<PAGE>

The average annual total return of a Sub-Account refers to return
quotations assuming an investment has been held in the Sub-Account for various
periods of time including, but not limited to, a period measured from the date
the Sub-Account commenced operations. When a Sub-Account has been in operation
for 1, 5, and 10 years, respectively, the average annual total return for these
periods will be provided. The average annual total return quotations will
represent the average annual compounded rates of return that would equate an
initial investment of $1,000 to the redemption value of that investment
(including the deduction of any applicable Contingent Deferred Sales Load but
excluding the deduction of any premium taxes) as of the last day of each of the
periods for which total return quotations are provided.
Performance information for any Sub-Account reflects only the
performance of a hypothetical Policy under which Policy Value is allocated to a
Sub-Account during a particular time period on which the calculations are based.
Performance information should be considered in light of the investment
objectives and policies and characteristics of the Portfolios in which the
Sub-Account invests, and the market conditions during the given time period, and
should not be considered as a representation of what may be achieved in the
future. For a description of the methods used to determine yield and total
returns, see the Statement of Additional Information.
Reports and promotional literature may also contain other information
including (1) the ranking of any Sub-Account derived from rankings of variable
annuity separate accounts or their investment products tracked by Lipper
Analytical Services, Inc., VARDS, IBC/Donoghue's Money Fund Report, Financial
Planning Magazine, Money Magazine, Bank Rate Monitor, Standard and Poor's
Indices, Dow Jones Industrial Average, and other rating services, companies,
publications, or other persons who rank separate accounts or other investment
products on overall performance or other criteria, and (2) the effect of tax
deferred compounding on Sub-Account investment returns, or returns in general,
which may be illustrated by graphs, charts, or otherwise, and which may include
a comparison, at various points in time, of the return from an investment in a
Policy (or returns in general) on a tax-deferred basis (assuming one or more tax
rates) with the return on a currently taxable basis. Other ranking services and
indices may be used.
In its advertisements and sales literature, Transamerica may discuss,
and may illustrate by graphs, charts, or otherwise, the implications of longer
life expectancy for retirement planning, the tax and other consequences of
long-term investment in the Policy, the effects of the Policy's lifetime payout
option, and the operation of certain special investment features of the Policy
- -- such as the Dollar Cost Averaging option. Transamerica may explain and depict
in charts, or other graphics, the effects of certain investment strategies.
Transamerica may also discuss the Social Security system and its projected
payout levels and retirement plans generally, using graphs, charts and other
illustrations.
Transamerica may from time to time also disclose average annual total
return in non-standard formats and cumulative (non-annualized) total return for
the Sub-Accounts. The non-standard average annual total return and cumulative
total return will assume that no Contingent Deferred Sales Load is applicable.
Transamerica may from time to time also disclose yield, standard total returns,
and non-standard total returns for any or all Sub-Accounts.
All non-standard performance data will only be disclosed if the
standard performance data is also disclosed. For additional information
regarding the calculation of other performance data, please refer to the
Statement of Additional Information.
Transamerica may also advertise performance figures for the
Sub-Accounts based on the performance of a Portfolio prior to the time the
Variable Account commenced operations.

<PAGE>

TRANSAMERICA LIFE INSURANCE COMPANY OF NEW YORK
AND THE VARIABLE ACCOUNT

Transamerica Life Insurance Company of New York

Transamerica Life Insurance Company of New York, formerly called First
Transamerica Life Insurance Company, ("Transamerica") is a stock life insurance
company incorporated under the laws of the State of New York on February 5,
1986. It is principally engaged in the sale of life insurance and annuity
policies. Transamerica is a wholly-owned subsidiary of Transamerica Occidental
Life Insurance Company, which in turn is an indirect subsidiary of Transamerica
Corporation. The address for Transamerica Life Insurance Company of New York is
575 Fifth Avenue, Thirty-Sixth Floor, New York, New York 10017-2422. The name
change to Transamerica Life Insurance Company of New York was effective May 1,
1997. Published Ratings

Transamerica may from time to time publish in advertisements, sales
literature and reports to Owners, the ratings and other information assigned to
it by one or more independent rating organizations such as A.M. Best Company,
Standard & Poor's, and Duff & Phelps. The purpose of the ratings is to reflect
the financial strength and/or claims-paying ability of Transamerica and should
not be considered as bearing on the investment performance of assets held in the
Variable Account. Each year the A.M. Best Company reviews the financial status
of thousands of insurers, culminating in the assignment of Best's Ratings. These
ratings reflect their current opinion of the relative financial strength and
operating performance of an insurance company in comparison to the norms of the
life/health insurance industry. In addition, the claims-paying ability of
Transamerica as measured by Standard & Poor's Insurance Ratings Services or Duff
& Phelps may be referred to in advertisements or sales literature or in reports
to Owners. These ratings are opinions of an operating insurance company's
financial capacity to meet the obligations of its insurance and annuity policies
in accordance with their terms. Such ratings do not reflect the investment
performance of the Variable Account or the degree of risk associated with an
investment in the Variable Account. The Variable Account

Separate Account VA-2LNY of Transamerica (the Variable Account) was
established by Transamerica as a separate account under the laws of the State of
New York on June 23, 1992, pursuant to resolutions of Transamerica's Board of
Directors. The Variable Account is registered with the Securities and Exchange
Commission ("Commission") under the Investment Company Act of 1940 (the "1940
Act") as a unit investment trust. It meets the definition of a separate account
under the federal securities laws. However, the Commission does not supervise
the management or the investment practices or policies of the Variable Account.

The assets of the Variable Account are owned by Transamerica but they
are held separately from the other assets of Transamerica. Section 4240 of the
New York Insurance Law provides that the assets of a separate account are not
chargeable with liabilities incurred in any other business operation of the
insurance company (except to the extent that assets in the separate account
exceed the reserves and other liabilities of the separate account) if and to the
extent so provided in the applicable agreements, and the Policies contain such a
provision. Income, gains and losses incurred on the assets in the Variable
Account, whether or not realized, are credited to or charged against the
Variable Account without regard to other income, gains or losses of
Transamerica. Therefore, the investment performance of the Variable Account is
entirely independent of the investment performance of Transamerica's general
account assets or any other separate account maintained by Transamerica.

The Variable Account has fifteen Sub-Accounts, each of which invests
solely in a specific corresponding Portfolio.
(See "The Funds" page 17.) Changes to the Sub-Accounts may be made at the
discretion of Transamerica. (See "Addition,
Deletion, or Substitution" page 20.)

THE FUNDS

The Variable Account invests exclusively in Series of Dreyfus Variable
Investment Fund (the "Variable Fund"), Dreyfus Stock Index Fund (the "Stock
Index Fund") and The Dreyfus Socially Responsible Growth Fund, Inc. (the
"Socially Responsible Fund"). The Variable Fund was organized as an
unincorporated business trust under Massachusetts law pursuant to an Agreement
and Declaration of Trust dated October 29, 1986, commenced operations on August
31, 1990, and is registered with the Commission as an open-end management
investment company under the 1940 Act. Currently, thirteen Series (i.e.,
Portfolios) of the Variable Fund are available for the Policies. Each Portfolio
has separate investment objectives and policies. As a result, each Portfolio
operates as a separate investment portfolio and the investment performance of
one Portfolio has no effect on the investment performance of any other
Portfolio. The Stock Index Fund was incorporated under

<PAGE>

Maryland law on January 24, 1989, commenced operations on September 29, 1989,
and is registered with the Commission as an open-end, non-diversified,
management investment company. The Socially Responsible Fund was incorporated
under Maryland law on July 20, 1992, commenced operations on August 31, 1993,
and is registered with the Commission as an open-end, diversified, management
investment company. However, the Commission does not supervise the management or
the investment practices and policies of any of the Funds. The assets of the
Variable Fund, the Socially Responsible Fund and the Stock Index Fund are each
separate from the assets of the other Funds.
The Dreyfus Corporation provides investment advisory and administrative
services to the Variable Fund and the Socially Responsible Fund. Mellon Equity
Associates provides index fund management services to the Stock Index Fund, with
The Dreyfus Corporation serving as the manager, in accordance with applicable
agreements with the Fund. Fayez Sarofim & Co. provides sub-investment advisory
services for the Capital Appreciation Portfolio. NCM Capital Management Group,
Inc., provides sub-investment advisory services for the Socially Responsible
Fund.
The Portfolios are described below. See the Variable Fund, the Stock
Index Fund and the Socially Responsible Fund
prospectuses for more information.
Money Market Portfolio

The Money Market Portfolio's investment objective is to achieve as high
a level of current income as is consistent with the preservation of capital and
the maintenance of liquidity. It seeks to achieve its objective by investing in
short-term money market instruments. The investment advisory fee is payable
monthly at the annual rate of 0.50 of 1% of the value of the Portfolio's average
daily net assets. This Portfolio is neither insured nor guaranteed by the United
States Government and there can be no assurance that it will be able to maintain
a stable net asset value of $1.00 per share. Special Value Portfolio
The Special Value Portfolio's investment objective is to maximize total
return, consisting of capital appreciation and current income. It seeks to
achieve its objective by investing in a wide range of equity and debt securities
and money market instruments. An investment advisory fee is payable monthly to
The Dreyfus Corporation at the annual rate of 0.75 of 1% (for a total of 0.75%)
of the value of the Portfolio's average daily net assets. The Special Value
Portfolio was called Managed Assets Portfolio prior to October 1, 1997. Zero
Coupon 2000 Portfolio

The Zero Coupon 2000 Portfolio's investment objective is to provide as
high an investment return as is consistent with the preservation of capital. It
seeks to achieve its objective by investing primarily in debt obligations of the
U.S. Treasury that have been stripped of their unmatured interest coupons,
interest coupons that have been stripped from debt obligations issued by the
U.S. Treasury and receipts and certificates for stripped debt obligations and
stripped coupons, including U.S. Government trust certificates (collectively,
"Stripped Treasury Securities"). The Portfolio's also may purchase certain other
types of stripped government or corporate securities. The Portfolio's assets
will consist primarily of portfolio securities which will mature on or about
December 31, 2000. The investment advisory fee is payable monthly at the annual
rate of 0.45 of 1% of the value of the Portfolio's average daily net assets.
Quality Bond Portfolio
The Quality Bond Portfolio's investment objective is to provide the
maximum amount of current income to the extent consistent with the preservation
of capital and the maintenance of liquidity. It seeks to achieve its objective
by investing principally in debt obligations of corporations, the U.S.
Government and its agencies and instrumentalities, and major banking
institutions. The investment advisory fee is payable monthly at the annual rate
of 0.65 of 1% of the value of the Portfolio's average daily net assets. Small
Cap Portfolio
The Small Cap Portfolio's investment objective is to maximize capital
appreciation. It seeks to achieve its objective by investing principally in
common stocks;under normal market conditions, the Portfolio's will invest at
least 65% of its total assets in companies with market capitalizations of less
than $1.5 billion at the time of purchase which The Dreyfus Corporation believes
to be characterized by new or innovative products, services or processes which
should enhance prospects for growth in the future earnings. The investment
advisory fee is payable monthly at the annual rate of 0.75 of 1% of the value of
the Portfolio's average daily net assets. Capital Appreciation Portfolio
The Capital Appreciation Portfolio's primary investment objective is to
provide long-term capital growth consistent with the preservation of capital;
current income is a secondary goal. It seeks to achieve its goals by investing
in common stocks of domestic and foreign issuers. An investment advisory fee is
payable to The Dreyfus Corporation and a sub-investment advisory fee is payable
monthly to Fayez Sarofim & Co. at the aggregate annual rate of 0.75 of 1% of the
value of the Portfolio's average daily net assets.

<PAGE>

Growth and Income Portfolio
The Growth and Income Portfolio's investment objective is to provide
long-term capital growth, current income and growth of income, consistent with
reasonable investment risk. This Portfolio invests primarily in equity and debt
securities and money market instruments of domestic and foreign issuers. The
proportion of the Portfolio's assets invested in each type of security will vary
from time to time in accordance with The Dreyfus Corporation's assessment of
economic conditions and investment opportunities. An investment advisory fee is
payable monthly to The Dreyfus Corporation at the annual rate of 0.75 of 1% of
the value of the Portfolio's average daily net assets. International Equity
Portfolio
The International Equity Portfolio's investment objective is to
maximize capital appreciation. This Portfolio's invests
primarily in the equity securities of foreign issuers located throughout the
world. An investment advisory fee at an annual
rate of 0.75 of 1% of the value of the Portfolio's average daily net assets is
payable monthly to The Dreyfus Corporation.
International Value Portfolio
The International Value Portfolio's investment objective is long-term
capital growth. This Portfolio invests primarily in a portfolio of publicly
traded equity securities of foreign issuers which would be characterized as
"value" companies according to criteria established by the Portfolio's
investment adviser. An investment advisory fee is payable monthly to The Dreyfus
Corporation at the annual rate of 1.00% of the value of the Portfolio's average
daily net assets. Disciplined Stock Portfolio
The Disciplined Stock Portfolio's investment objective is to provide
investment results that are greater than the total return performance of
publicly traded common stocks in the aggregate, as presented by the Standard &
Poor's 500 Composite Stock Price Index. This Portfolio will use quantitative
statistical modeling techniques to construct a portfolio in an attempt to
achieve its investment objective without assuming undue risk relative to the
broad stock market. An investment advisory fee is payable monthly to The Dreyfus
Corporation at the annual rate of 0.75 of 1% of the value of the Portfolio's
average daily net assets. Small Company Stock Portfolio

The Small Company Stock Portfolio's investment objective is to provide
investment results that are greater than the total return performance of
publicly traded common stocks in the aggregate as represented by the Russell
2500(TM) Index. This Portfolio invests primarily in a portfolio of equity
securities of small- to medium-sized domestic issuers, while attempting to
maintain volatility and diversification similar to that of the Russell 2500(TM)
Index. An investment advisory fee is payable monthly to the Dreyfus Corporation
at the annual rate of 0.75 of 1% of the value of the Portfolio's average daily
net assets. Balanced Portfolio
The Balanced Portfolio's investment objective is to provide investment
results that are greater than the total return performance of common stocks and
bonds in the aggregate, as represented by a hybrid index, 60% of which is
composed of the common stocks in the Standard & Poor's 500 Composite Stock Price
Index and 40% of which is composed of the bonds in the Lehman Brothers
Intermediate Government/Corporate Bond Index. This Series invests primarily in
common stocks and bonds in proportion consistent with their expected returns and
risks as determined by The Dreyfus Corporation. An investment advisory fee is
payable monthly to the Dreyfus Corporation at the annual rate of 0.75% of 1% of
the value of the Portfolio's average daily net assets. Limited Term High Income
Portfolio

The Limited Term High Income Portfolio's investment objective is to
maximize total return, consisting of capital appreciation and current income.
This Portfolio seeks to achieve its objective by investing up to all of its
assets in a portfolio of lower rated fixed-income securities, commonly known as
"junk bonds," that, under normal market conditions, has an effective duration of
three and on-half years or less and an effective average portfolio maturity of
four years or less. Investments of this type are subject to a greater risk of
loss of principal and non-payment of interest. Investors should carefully assess
the risks associated with an investment in the Portfolio (those risks are
described in the Portfolio's prospectus). An investment advisory fee is payable
monthly to the Dreyfus Corporation at the annual rate of 0.65% of 1% of the
value of the Portfolio's average daily net assets. Stock Index Fund
The Stock Index Fund's investment objective is to provide investment
results that correspond to the price and yield performance of publicly traded
common stocks in the aggregate, as represented by the Standard & Poor's 500
Composite Stock Price Index. The Stock Index Fund is neither sponsored by nor
affiliated with Standard & Poor's Corporation. The Stock Index Fund pays a
monthly management fee to The Dreyfus Corporation at the annual rate of 0.245%
of the value of the Stock Index Fund's average daily net assets. The Dreyfus
Corporation has agreed to pay Mellon Equity Associates a monthly fee at the
annual rate of 0.095% of the value of the Fund's average daily net assets.

<PAGE>

Socially Responsible Fund
The Socially Responsible Fund's primary goal is to provide capital
growth. It seeks to achieve this goal by investing principally in common stocks,
or securities convertible into common stock, of companies which, in the opinion
of the Fund's management, not only meet traditional investment standards, but
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 a
secondary goal. A management fee is payable monthly to The Dreyfus Corporation
at the annual rate of 0.75 of 1% of the value of the Socially Responsible Fund's
average daily net assets. The Dreyfus Corporation pays NCM Capital Management
Group, Inc. a sub-investment advisory fee at the annual rate of 0.10 of 1% of
the Portfolio's average daily net assets up to $32 million; 0.15 of 1% of the
Portfolio's average daily net assets in excess of $32 million up to $150
million; 0.20 of 1% of the Portfolio's average daily net assets in excess of
$150 million up to $300 million; and 0.25 of 1% of the Portfolio's average daily
net assets in excess of $300 million.
Meeting objectives depends on various factors, including, but not
limited to, how well the portfolio managers
anticipate changing economic and market conditions. THERE IS NO ASSURANCE THAT
ANY OF THESE PORTFOLIOS
WILL ACHIEVE THEIR STATED OBJECTIVES.
An investment in the Policy is not a deposit or obligation of, or
guaranteed or endorsed by, any bank, nor is the Policy federally insured by the
Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investing in the Policy involves certain investment risks,
including possible loss of principal.
Since all of the Portfolios are available to registered separate
accounts offering variable annuity and variable life products of Transamerica as
well as other insurance companies, there is a possibility that a material
conflict may arise between the interests of the Variable Account and one or more
other separate accounts investing in the Funds. In the event of a material
conflict, the affected insurance companies will take any necessary steps to
resolve the matter, including stopping their separate account from investing in
the Funds. See the Funds' prospectuses for more details.
Transamerica receives fees from the Dreyfus Corporation or its
affiliates for providing certain administrative and or other services.
Additional information concerning the investment objectives and
policies of all of the Portfolios, the investment advisory services and
administrative services and charges can be found in the current prospectuses for
the Funds which accompany this Prospectus. The Funds' prospectuses should be
read carefully before any decision is made concerning the allocation of Premiums
to, or transfers among, the Sub-Accounts. Addition, Deletion or Substitution
Transamerica does not control the Funds and cannot guarantee that any
of the Sub-Accounts of the Variable Account or any of the Portfolios will always
be available for allocation of Premiums or transfers. Transamerica retains the
right to make changes in the Variable Account and in its investments.
Subject to the approval of the New York Insurance Department,
Transamerica reserves the right to eliminate the shares of any Portfolio held by
a Sub-Account, and to substitute shares of another Portfolio or of another
investment company for the shares of any Portfolio, if the shares of the
Portfolio are no longer available for investment or if, in Transamerica's
judgement, investment in any Portfolio would be inappropriate in view of the
purposes of the Variable Account. To the extent required by the 1940 Act, a
substitution of shares attributable to the Owner's interest in a Sub-Account
will not be made without prior notice to the Owner and the prior approval of the
Commission. Nothing contained herein shall prevent the Variable Account from
purchasing other securities for other series or classes of variable annuity
policies, or from effecting an exchange between series or classes of variable
policies on the basis of requests made by Owners.
New Sub-Accounts may be established when, in the sole discretion of
Transamerica, marketing, tax, investment or other conditions so warrant. Any new
Sub-Accounts will be made available to existing Owners on a basis to be
determined by Transamerica. Each additional Sub-Account will purchase shares in
a Portfolio or in another mutual fund or investment vehicle. Transamerica may
also eliminate one or more Sub-Accounts if, in its sole discretion, marketing,
tax, investment or other conditions so warrant. In the event any Sub-Account is
eliminated, Transamerica will notify Owners and request a re-allocation of the
amounts invested in the eliminated Sub-Account.
In the event of any substitution or change, Transamerica may make such
changes in the Policies 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 Policies, the Variable Account may be
operated as a management company under the 1940 Act or any other form permitted
by law, may be deregistered under such Act in the event such registration is no
longer required, or may be combined with one or more other separate accounts.

<PAGE>

THE POLICY

The Policy is a Flexible Premium Multi-Funded Individual Deferred
Annuity Policy. The rights and benefits under the Policy are described below and
in the Policy; however, Transamerica reserves the right to make any modification
to conform the Policy to, or give the Policy Owner the benefit of, any federal
or state statute or rule or regulation. The obligations under the Policy are
obligations of Transamerica.

The Policies are available on a non-qualified basis and as individual
retirement annuities (IRAs) that qualify for special federal income tax
treatment and whose initial Premium is a rollover from a qualified retirement
plan. With Transamerica's prior permission, the Policies may also be available
as a contributory IRAs, as Section 403(b) annuities and for use in qualified
pension and profit sharing plans established by corporate employers. Generally,
Qualified Policies contain restrictive provisions limiting the timing and amount
of payments and distributions from the Qualified Policy.

POLICY APPLICATION AND PREMIUMS

Premiums
All Premiums must be paid to the Service Center. A confirmation will be
issued to the Owner upon the acceptance of each Premium.

The Initial Premium for each Policy must generally be at least $5,000.
Transamerica, may, in its discretion, accept lower initial Premiums for certain
Qualified Policies.
The Policy will be issued and the Net Premium derived from the Initial
Premium generally will be accepted and credited within two business days after
the receipt of a properly completed application and receipt of the Initial
Premium at the Service Center. (A Net Premium is the Premium less any applicable
premium taxes, including retaliatory premium taxes, should such taxes be levied
in the future in New York or should the Owner live in a state with such taxes in
the future.) Acceptance is subject to the application being received in good
order and Transamerica reserves the right to reject any application. Policies
normally will not be issued with respect to Annuitants more than 80 years old,
although Transamerica in its discretion may waive this restriction in certain
cases.

If the Initial Premium cannot be credited within two days of receipt of
the Premium and application because the application is incomplete or for any
other reason, then Transamerica will contact the Owner, explain the reason for
the delay and will refund the Initial Premium within five business days unless
the Owner consents to Transamerica retaining the Initial Premium and crediting
it as soon as the requirements are fulfilled.
The Owner has the right to examine the Policy for a limited period
known as a "Free Look Period." The Owner can cancel the Policy by delivering or
mailing a written notice or by sending a telegram to (a) the agent through whom
the Policy was purchased or (b) the Service Center, before midnight of the tenth
day after receipt of the Policy. Notice given by mail and the return of the
Policy by mail, properly addressed and postage prepaid, will be deemed by
Transamerica to have been made on the date postmarked. Transamerica will refund
the Policy Value determined as of the date the notice is postmarked within seven
days after receipt of such notice to cancel and the returned Policy.

Additional Premiums may be made at any time prior to the Annuity Date,
as long as the Annuitant or Contingent Annuitant is living. Additional Premiums
must be at least $500, or at least $100 if made pursuant to an automatic payment
plan, under which the Additional Premiums is automatically deducted from a bank
account. In addition, minimum allocation amounts apply (see "Allocation of
Premiums" on page 21). Additional Net Premiums are credited to the Policy as of
the date the payment is received. Currently, additional Premiums after the
initial Premium may not be made to Section 403(b) annuity Policies.

Total Premiums for any Policy may not exceed $1,000,000 without prior
approval of Transamerica. In no event may the sum of all Premiums for a
Policy during any taxable year exceed the limits imposed by any
applicable federal or state laws, rules, or regulations.
Allocation of Premiums

The Owner specifies in the application how Premiums will be allocated
under the Policy. The Owner may allocate the Net Premium to one or more of the
Sub-Accounts as long as the portions are whole number percentages and any
allocation percentage for a Sub-Account is at least 10%. In addition, the
Initial Premium is subject to a minimum allocation of $500 to any selected
Sub-Account. The Owner may choose to allocate nothing to a particular
Sub-Account.

For IRAs, on the Policy Date, the Net Premium derived from the Initial
Premium will first be allocated to the Money Market Sub-Account of the Variable
Account and will remain in that Sub-Account for fifteen calendar days after the
Policy Date. At that time, the dollar value of the Accumulation Units held in
the Money Market Sub-Account attributable to such

<PAGE>

net Premium will be allocated among the Sub-Accounts of the Variable Account in
accordance with the allocation percentages selected by the Owner in the
application. This initial allocation after the Free Look Period from the Money
Market Sub- Account to the Sub-Accounts selected by the Owner does not count
towards the limit of 18 transfers per Policy Year. On non-IRA Policies, the Net
Premium derived from the initial Premium will be allocated directly to the
Sub-Account(s) selected by the Owner.

Each Net Premium will be subject to the allocation percentages in
effect at the time of receipt of such Premium. The allocation percentages for
new Premiums among the Sub-Accounts may be changed by the Owner at any time by
submitting a request for such change to the Service Center in a form and manner
acceptable to Transamerica. Any changes to the allocation percentages are
subject to the limitation above. Any change will take effect with the first
Premium received with or after receipt of request for such change by the Service
Center, in a form and manner acceptable to Transamerica, and will continue in
effect until subsequently changed.
If the allocation of additional Net Premiums is directed to an Inactive
Sub-Account of the Variable Account, then the amount allocated must be at least
$500.

POLICY VALUE

Before the Annuity Date, the Policy Value is the total dollar amount of
all Variable Accumulation Units in each Sub-Account credited to a Policy. The
Policy Value is equal to: (a) Net Premiums; plus or minus (b) any increase or
decrease in the value of the Sub-Accounts due to investment results; less (c)
the daily Mortality and Expense Risk Charge; less (d) the daily Administrative
Expense Charge; less (e) the annual Policy Fees, if applicable, taken at the end
of each Policy Year; less (f) any Transfer Fees; and less (g) any withdrawals
from the Sub-Accounts less any premium tax applicable to those withdrawals.
A Valuation Period is the period between successive Valuation Days. It
begins at the close of the New York Stock Exchange (generally 4:00 p.m. ET) on
each Valuation Day and ends at the close of the New York Stock Exchange on the
next succeeding Valuation Day. A Valuation Day is each day that the New York
Stock Exchange is open for regular business. The value of the Variable Account
assets is determined at the end of each Valuation Day. To determine the value of
an asset on a day that is not a Valuation Day, the value of that asset as of the
end of the next Valuation Day will be used.
The Policy Value is expected to change from Valuation Period to
Valuation Period, reflecting the investment experience of all of the selected
Portfolios as well as the deductions for charges.
Net Premiums which the Owner allocates to a Sub-Account of the Variable
Account are used to purchase Variable Accumulation Units in that Sub-Account.
The number of Variable Accumulation Units to be credited for each Sub-Account
will be determined by dividing the portion of each Net Premium allocated to the
Sub-Account by the Variable Accumulation Unit Value determined at the end of the
Valuation Period during which the Net Premium was received. In the case of the
Initial Net Premium, Variable Accumulation Units for that payment will be
credited to the Policy Value (and held in the Money Market Sub-Account for
fifteen calendar days after the Policy Date) within two Valuation Days of the
later of: (a) the date an acceptable and properly completed application is
received at our Service Center; or (b) the date our Service Center receives the
Initial Premium. In the case of any subsequent Premium, Variable Accumulation
Units for that payment will be credited at the end of the Valuation Period
during which Transamerica receives the payment. The value of a Variable
Accumulation Unit for each Sub-Account for a Valuation Period is established at
the end of each Valuation Period and is calculated by multiplying the value of
that unit at the end of the prior Valuation Period by the Sub-Account's Net
Investment Factor for the Valuation Period. The value of a Variable Accumulation
Unit may go up or down.
The Net Investment Factor is used to determine the value of
Accumulation and Annuity Unit Values for the end of a Valuation Period. The
applicable formula can be found in the Statement of Additional Information.
Transfers among the Sub-Accounts will result in the purchase and/or
cancellation of Variable Accumulation Units having a total value equal to the
dollar amount being transferred to or from a particular Sub-Account. The
purchase and cancellation of such units generally are made using the Variable
Accumulation Unit value of the applicable Sub-Accounts as of the end of the
Valuation Day in which the transfer is effective.

TRANSFERS

Before the Annuity Date
Before the Annuity Date, the Owner may transfer all or part of the
Policy Value among the Variable Sub-Account(s) by giving a Written Request to
the Service Center subject to the following conditions: (1) not more than 18
transfers may be made in any Policy Year; (2) the minimum amount which may be
transferred is $500; and (3) the minimum transfer to

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an Inactive Sub-Account is $500. Transfers are also subject to such terms and
conditions as may be imposed by the Funds.

Transfer requests must specify the amounts being transferred from each
Sub-Account and the amounts being transferred into each Sub-Account.
Currently, there is no charge for transfers. However, Transamerica
reserves the right to impose a charge of the lesser of 2% of the amount
transferred or $10 for each transfer after twelve in any Policy Year. All
requests received during a single Valuation Period will be treated as a single
transfer. A transfer generally will be effective on the date the request for
transfer is received by the Service Center.
If a transfer reduces the value in a Sub-Account to less than $500,
then Transamerica reserves the right to transfer
the remaining amount along with the amount requested to be transferred in
accordance with the transfer instructions provided
by the Owner. Under current law, there will not be any tax liability to the
Owner if the Owner makes a transfer.
Possible Restrictions

Transamerica reserves the right without prior notice to modify,
restrict, suspend or eliminate the transfer privileges at any time and for any
reason. For example, restrictions may be necessary to protect Owners from
adverse impacts on portfolio management of large and/or numerous transfers by
market timers or others. Transamerica has determined that the movement of
significant Sub-Account values from one Sub-Account to another may prevent the
underlying Portfolio from taking advantage of investment opportunities because
the Portfolio must maintain a significant cash position in order to handle
redemptions. Such movement may also cause a substantial increase in Portfolio
transaction costs which must be indirectly borne by Owners. Therefore,
Transamerica reserves the right to require that all transfer requests be made by
the Owner and not by a third party holding a power of attorney and to require
that each transfer request be made by a separate communication to Transamerica.
Transamerica also reserves the right to request that each transfer request be
submitted in writing and be manually signed by the Owner or Owners; facsimile
transfer requests may not be allowed. Dollar Cost Averaging
Prior to the Annuity Date, the Owner may request that amounts be
automatically transferred from one (and only one) of the Sub-Accounts which
invest in the Money Market, Quality Bond or Limited Term High Income Portfolios
to any of the Sub-Accounts on a monthly basis by submitting a request to the
Service Center in a form and manner acceptable to Transamerica. The transfers
will begin the month following, but no sooner than one week following, receipt
of such request, provided that Dollar Cost Averaging transfers will not commence
until the later of (a) 30 days after the Policy Date, or (b) the estimated end
of the Free Look Period (allowing 5 days for delivery of the Policy by mail).
Transfers will continue for twelve consecutive months unless (1) terminated by
the Owner, (2) Transamerica has provided for a longer term, (3) automatically
terminated by Transamerica because there are insufficient funds in the
applicable Sub-Account, or (4) for other reasons as set forth in the Policy. The
Owner may request that monthly transfers be continued for an additional period
of time by giving notice to the Service Center in a form and manner acceptable
to Transamerica within 30 days prior to the last monthly transfer. If no request
to continue the monthly transfers is made by the Owner, this option will
terminate automatically with the last transfer.

In order to be eligible for Dollar Cost Averaging, the Owner must meet
the following conditions: (1) the value of the selected Sub-Account (from which
the transfers are made) must be at least $5,000; (2) the minimum amount that can
be transferred out of the selected Sub-Account is $250 per month; and (3) the
minimum amount transferred into any other Sub-Account is the greater of $250 or
10% of the amount being transferred. Dollar Cost Averaging transfers can not be
made from a Sub-Account from which Systematic Withdrawals or Automatic Payouts
are being made.

There is no charge for the Dollar Cost Averaging service and transfers
due to Dollar Cost Averaging will not count
toward the number of transfers without charge nor the limit of 18 transfers per
Policy Year.
Automatic Asset Rebalancing
After Premiums have been allocated among the variable Sub-Accounts, the
performance of each Sub-Account may cause this allocation to change. The Owner
may instruct Transamerica to automatically rebalance the amounts in the Variable
Accumulated Value by reallocating amounts among the variable Sub-Accounts, at
the time, and in the percentages, specified in the Owner instructions to
Transamerica and accepted by Transamerica. The Owner may elect to have the
rebalancing done on an annual, semi-annual or quarterly basis. The Owner may
elect to have amounts allocated among the Sub-Accounts using whole percentages,
with a minimum of 10% allocated to each Sub-Account.
The Owner may elect to establish, change or terminate the Automatic
Asset Rebalancing by submitting a request to the Service Center in a form and
manner acceptable to Transamerica. The restrictions concerning transfers
described on page 29 will not be applicable to the Automatic Asset Rebalancing;
Automatic Asset Rebalancing will not count towards the limit of 18 transfers in
a Policy Year. There is currently no charge for the Automatic Asset Rebalancing,

<PAGE>

however, Transamerica reserves the right to charge a nominal amount for this
feature. Transamerica reserves the right to
discontinue offering Automatic Asset Rebalancing any time for any reason.
After the Annuity Date
If a Variable Annuity Payout Option is elected, the Owner may transfer
Variable Account amounts after the Annuity Date by submitting a request in a
form acceptable to Transamerica to the Service Center, in a form and manner
acceptable to Transamerica, subject to the following provisions: (1) transfers
after the Annuity Date may be made no more than four times during any Annuity
Year; and (2) the minimum amount transferred from one Sub-Account to another is
the amount supporting a current $50 monthly payment.
Transfers among Sub-Accounts during the Annuity Period will be
processed based on the formula outlined in the Statement of Additional
Information.

CASH WITHDRAWALS

Withdrawals
The Owner may withdraw all or part of the Cash Surrender Value for a
Policy at any time during the life of the Annuitant and prior to the Annuity
Date by giving a written request to the Service Center and subject to the rules
below. Federal or state laws, rules or regulations may also apply. The amount
payable to the Owner if the Policy is surrendered on or before the Annuity Date
is the Cash Surrender Value which is equal to the Policy Value, less any Policy
Fee, less any applicable Contingent Deferred Sales Load and less any applicable
premium taxes.
No withdrawals may be made after the Annuity Date. Only one partial
withdrawal will be permitted while the Systematic Withdrawal Option is in
effect. Partial withdrawals must be at least $500.
A full surrender will result in a cash withdrawal payment equal to the
Cash Surrender Value at the end of the Valuation Period during which the request
is received along with all completed forms. Any applicable Contingent Deferred
Sales Load will be deducted from the amount paid.

In the case of a partial withdrawal, the Owner may instruct the Service
Center as to the amounts to be withdrawn from each Sub-Account. If the Owner
does not specify the Sub-Account(s) from which the withdrawal is to be made, the
withdrawal will be taken pro rata from all Sub-Accounts with current values. If
the requested withdrawal reduces the value of the Sub-Account from which the
withdrawal was made to less than $500, Transamerica reserves the right to
transfer the remaining value of that Sub-Account pro rata among the other Active
Sub-Accounts with values equal to or greater than $500. If no such Sub-Accounts
exist, such transfer will be made to the Money Market Sub-Account. The Owner
will be notified in writing of any such transfer.

A partial withdrawal will not be processed if it would reduce the
Policy Value to less than $2,000. In that case, the Owner will be notified that
he or she will have 10 days from the date notice is mailed to: (a) withdraw a
lesser amount (subject to the $500 minimum), leaving a Policy Value of at least
$2,000; or (b) surrender the Policy for its Cash Surrender Value. (Amounts
payable will be determined as of the end of the Valuation Period during which
the subsequent instructions are received.) If, after the expiration of the
10-day period, no written election is received from the Owner, the withdrawal
request will be considered null and void, and no withdrawal will be processed.
The Policy Fee will be deducted from a full surrender before the
application of any Contingent Deferred Sales Load (see "Charges and Deductions"
page 26). Withdrawals will be allocated on a first-in, first-out basis from
Premiums, and then from earnings (for purposes of calculating the Contingent
Deferred Sales Load).
Withdrawals may be taxable transactions. The Code requires Transamerica
to withhold federal income tax from withdrawals. However, generally an Owner
will be entitled to elect, in writing, not to have tax withholding apply.
Withholding applies to the portion of the withdrawal which is includible in
income and subject to federal income tax. The federal income tax withholding
rate for partial withdrawals and full surrenders is 10%, or 20% in the case of
certain qualified plans, of the taxable amount of the withdrawal. Withholding
applies only if the taxable amount of the withdrawal is at least $200. Moreover,
the Code provides that a 10% penalty tax may be imposed on the taxable portions
of distributions for certain early withdrawals. (See "Federal Tax Matters" page
32.) In addition, under New York law the Owner may request Transamerica to
withhold New York income tax from withdrawals.
Withdrawal (including surrender) requests generally will be processed
as of the end of the Valuation Period during which the request, including all
completed forms, is received. Payment of any cash withdrawal or lump sum death
benefit due from the Variable Account will occur within seven days from the date
the request is received, except that Transamerica may postpone such payment if:
(1) the New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on the Exchange is otherwise restricted; or (2) an
emergency exists as defined by the Commission, or the Commission requires that
trading be restricted; or (3) the Commission permits a delay for the protection
of Owners. The withdrawal

<PAGE>

request will be effective when all appropriate withdrawal request forms are
received. Payments of any amounts derived from Premiums paid by check may be
delayed until the check has cleared the Owner's bank.
SINCE THE OWNER ASSUMES THE INVESTMENT RISK AND BECAUSE CERTAIN
WITHDRAWALS ARE SUBJECT TO A CONTINGENT DEFERRED SALES LOAD, THE TOTAL AMOUNT
PAID UPON SURRENDER OF THE POLICY (TAKING INTO ACCOUNT ANY PRIOR WITHDRAWALS)
MAY BE MORE OR LESS THAN THE TOTAL PREMIUMS PAID.
After a withdrawal of the total Cash Surrender Value, or at any time
that the Policy Value is zero, all rights of the Owner will terminate.
Since the Qualified Policies offered by the Prospectus, only with
Transamerica's prior permission (except for rollover IRA's), will be issued in
connection with retirement plans which meet the requirements of Section 408(b)
of the Code, reference should be made to the terms of the particular retirement
plans for any additional limitations or restrictions on cash withdrawals.
An Owner may elect, under the Systematic Withdrawal Option or Automatic
Payout Option (but not both), to
withdraw certain amounts on a periodic basis from the Sub-Accounts prior to the
Annuity Date.
Systematic Withdrawal Option
Prior to the Annuity Date, the Owner, by giving Written Notice to the
Service Center, may elect to have withdrawals automatically made from one or
more Sub-Account(s) on a monthly basis. (Other distribution modes may be
permitted.) The withdrawals will commence the month following, but no sooner
than one week following, receipt of Written Notice, except that they will not
commence sooner than the later of (a) 30 days after the Policy Date or (b) the
end of the Free Look Period. Upon written notice to the Owners, Transamerica may
change the day of the month on which withdrawals are made under this option.
Withdrawals will be from the Sub-Account(s) and in the percentage allocations
specified by the Owner. If no specifications are made, withdrawals will be pro
rata from all Sub-Account(s) with value. Systematic Withdrawals can not be made
from a Sub-Account from which Dollar Cost Averaging transfers are being made.
To be eligible for the Systematic Withdrawal Option, the Policy Value
must be at least $12,000 at the time of election. The minimum monthly amount
that can be withdrawn is $100. The maximum monthly amount that can be withdrawn
on an annual basis is equal to the sum, as of the date of the first withdrawal,
of (a) 10% of Premiums that are less than seven Policy Years old and (b) 10% of
remaining Premiums that are at least seven Policy Years old.
Systematic withdrawals are not subject to the Contingent Deferred Sales
Load but can be reduced by any applicable
premium tax. Systematic withdrawals may be taxable, subject to withholding, and
subject to the 10% penalty tax. (See
"Federal Tax Matters" page 32.)

The systematic withdrawals will continue unless terminated by the Owner
or automatically terminated by Transamerica as set forth in the Policy. If this
option is terminated it may not be elected again until the next Policy
Anniversary. Only one partial withdrawal can be made while the Systematic
Withdrawal Option is in effect and a second partial withdrawal taken while this
option is in effect will automatically terminate the Systematic Withdrawal
Option and any amount requested as a partial withdrawal (including the first in
a Policy Year) will be subject to a Contingent Deferred Sales Load to the extent
it exceeds accumulated earnings.
Transamerica reserves the right to impose an annual fee of an amount
not to exceed $25 per Policy year for administrative expenses associated with
processing the systematic withdrawals. This fee, which is currently waived, will
be deducted from each systematic withdrawal in equal installments during a
Policy Year. Consult your tax adviser and, if applicable, the particular
retirement plan, before requesting withdrawals from a Qualified Policy. There
may be severe restrictions with regard to withdrawals from Qualified Policies.
Automatic Payout Option ("APO")
Prior to the Annuity Date, the Owner may elect the Automatic Payout
Option ("APO") to satisfy minimum distribution requirements under the Code for
Qualified Policies, including under Section 408(b)(3) of the Code with regard to
IRA's. See the Automatic Payout Option discussion under Qualified Policies on
page 32.

DEATH BENEFIT

If the Owner or Annuitant dies before the Annuity Date, a death benefit
is payable. If the deceased Owner or Annuitant, as applicable, had not attained
their 85th birthday, the death benefit will be the greatest of (a) the Policy
Value, (b) all Premiums paid less all withdrawals and any premium taxes
applicable to those withdrawals or (c) the greatest Policy Anniversary Value
prior to the earliest of the Annuitant's or Owner's 75th birthday increased by
all Premiums paid since that Policy Anniversary less all withdrawals and any
premium taxes applicable to those withdrawals since that Policy Anniversary. If
the deceased Owner or Annuitant, as applicable, had attained age 85, the death
benefit will be equal to the Policy Value.

<PAGE>

The Death Benefit will be determined as of the Valuation Period during which the
later of (a) Proof of Death of the Owner or Annuitant is received by the Service
Center or (b) a Written Notice of the method of settlement elected by the
Beneficiary is received at the Service Center. If no settlement method is
elected, the death benefit will be calculated and paid as of a date no later
than one year after the date of death. No Contingent Deferred Sales Load will
apply. Until the death benefit is paid, the Policy Value will remain in the
Sub-Accounts as previously specified by the Owner or as reallocated pursuant to
instructions received by Transamerica from all Beneficiaries. Therefore, the
Policy Value will fluctuate with investment performance of the applicable
Sub-Account(s) and accordingly, the amount of the death benefit will depend on
the Policy Value at the time the death benefit is paid. Payment of Death Benefit
The death benefit is generally payable upon receipt of Proof of Death
of the Annuitant or Owner. Upon receipt of this proof and an election of a
method of settlement, the death benefit generally will be paid within seven
days, or as soon thereafter as Transamerica has sufficient information to make
the payment. The death benefit may be paid in a lump sum cash benefit or,
subject to any limitations under any state or federal law, rule, or regulation,
under one of the Annuity Forms unless a settlement agreement is effective under
the Policy preventing such election. If no settlement method is elected within
one year of the date of death, the death benefit will be paid in a lump sum. The
payment of the death benefit may be subject to certain distribution requirements
under the federal income tax laws. (See "Federal Tax Matters" page 32.)
Designation of Beneficiaries
The Owner may select one or more Beneficiaries and name them in the
application. If the Owner selects more than one beneficiary, unless otherwise
indicated by the Owner they will share equally in any death benefits payable in
the event of the Annuitant's death before the Annuity Date if there is no
Contingent Annuitant, or the Owner's death if there is no Joint Owner. Different
Beneficiaries may be named with respect to the Annuitant's death (Annuitant's
Beneficiary) and the Owner's death (Owner's Beneficiary). Before the Annuitant's
death, the Owner may change the Beneficiary by notice to the Service Center in a
form and manner acceptable to Transamerica. The Owner may also make the
designation of Beneficiary irrevocable by sending notice to and obtaining
approval from the Service Center. Irrevocable Beneficiaries may only be changed
with the written consent of the designated Irrevocable Beneficiaries, except to
the extent required by law.
The interest of any Beneficiary who dies before the Owner or Annuitant
will terminate at the death of the Beneficiary. The interest of any Beneficiary
who dies at the time of, or within 30 days after, the death of the Owner or
Annuitant will also terminate if no benefits have been paid unless the Policy
has been endorsed to provide otherwise. The benefits will then be paid as though
the Beneficiary had died before the Owner or Annuitant. If the interests of all
designated Beneficiaries have terminated, any benefits payable will be paid to
the Owner's estate.
Transamerica may rely on an affidavit by any responsible person in
determining the identity or non-existence of any Beneficiary not identified by
name.
Death of Annuitant Prior to the Annuity Date
If the Annuitant dies prior to the Annuity Date and the Annuitant is
not the Owner and there is no Contingent Annuitant, a death benefit under the
Policy relating to that Annuitant will be paid to the Annuitant's Beneficiary.
If there is a Contingent Annuitant, then upon the death of the Annuitant the
Contingent Annuitant will become the Annuitant and no Death Benefit will be paid
at that time. Death of Owner Prior to the Annuity Date

If an Owner dies before the Annuity Date, a death benefit will be paid
to that Owner's Beneficiary. If the Policy has Joint Owners, the surviving Joint
Owner will be the Owner's Beneficiary. If the Owner's Beneficiary is the
deceased Owner's spouse, then the spouse may elect to treat the Policy as his or
her own or receives payment of the death benefit. The payment of the death
benefit may be subject to certain distribution requirements under the federal
income tax laws. (See "Federal Tax Matters" page 32.)

Death of Annuitant or Owner After the Annuity Date
If the Annuitant or an Owner dies after the annuity starts, the
remaining undistributed portion, if any, of the Policy will be distributed at
least as rapidly as under the method of distribution being used as of the date
of such death. Under some Annuity Forms, there will be no death benefit. If the
Owner is not the Annuitant, upon an Owner's death, any remaining ownership
rights will pass to the Owner's Beneficiary.

CHARGES AND DEDUCTIONS

No deductions are made from Premiums except for any applicable premium
taxes. Therefore, the full amount, less any premium taxes, of the Premiums are
invested in one or more of the Sub-Accounts of the Variable Account.
As more fully described below, charges under the Policy are assessed
in three ways: (1) as deductions for the Policy

<PAGE>

(or Annuity) Fees, any Transfer Fees, any Systematic Withdrawal Option fees and,
if applicable, for premium taxes; (2) as charges against the assets of the
Variable Account for the assumption of mortality and expense risks and
administrative expenses; and (3) as Contingent Deferred Sales Loads. In
addition, certain deductions are made from the assets of the Funds for
investment management fees and expenses. These fees and expenses are described
in the Funds' prospectuses and their statements of additional information.
Contingent Deferred Sales Load
No deduction for sales charges is made from Premiums (although premium
tax may be deducted). However, a Contingent Deferred Sales Load of up to 6% of
Premiums paid may be imposed on certain withdrawals or surrenders (and possibly
on certain annuitizations) to partially cover certain expenses incurred by
Transamerica relating to the sale of the Policies, including commissions paid to
salespersons, the costs of preparation of sales literature and other promotional
costs and acquisition expenses.
The Contingent Deferred Sales Load percentage varies according to the
number of Policy Years between the Policy Year in which a Net Premium was
credited to the Policy and the Policy Year in which the withdrawal is made. The
amount of the Contingent Deferred Sales Load is determined by multiplying the
amount withdrawn subject to the Contingent Deferred Sales Load by the Contingent
Deferred Sales Load percentage in accordance with the following table.

Number of Policy Years Contingent Deferred Sales Load
Since Receipt of Each Premium As a Percentage of Premium
Less than one year 6%
1 year but less than 2 years 6%
2 years but less than 3 years 5%
3 years but less than 4 years 5%
4 years but less than 5 years 4%
5 years but less than 6 years 4%
6 years but less than 7 years 2%
7 or more years 0%

In no event shall the aggregate Contingent Deferred Sales Load assessed
against the Policy exceed 6% of the aggregate Premiums paid to a Policy.

Certain amounts may be withdrawn free of any Contingent Deferred Sales
Load. The Owner may make withdrawals up to the "Allowed Amount" (described
below) without incurring a Contingent Deferred Sales Load each Policy Year
before the Annuity Date. During the first Policy Year, the Allowed Amount is
equal to accumulated earnings not previously withdrawn. For the First
withdrawal, and only the first withdrawal in a Policy Year after the first
Policy Year, the available Allowed Amount is equal to the sum of (a) 100% of
Premiums not previously withdrawn and received at least seven Policy years
before the date of withdrawal; please (b) the greater of (i) the accumulated
earnings not previously withdrawn or (ii) 10% of Premiums received at least one
but less than seven complete Policy Years before the date of withdrawal not
reduced to take into account any withdrawals deemed to be made from such
Premiums. After the first withdrawal in a Policy Year, after the first Policy
Year, the available Allowed Amount is equal to the sum of: (a) 100% of Premiums
not previously withdrawn and received at least seven complete Policy Years
before the date of withdrawal; plus (b) accumulated earnings not previously
withdrawn. Withdrawals will always be made first from accumulated earnings, and
then from Premiums on a first in first out basis, so that accumulated earnings
may be depleted with the first withdrawal and the 10% of Premiums discussed
above is not used in the calculation of the Allowed Amount. If an Allowed Amount
is not withdrawn during a Policy Year, it does not carry over to the next Policy
Year. However, accumulated earnings, if any, in an Owner's Policy Value are
always available as the Allowed Amount. No withdrawals are allowed with regard
to Premiums made by a check which has not cleared.
Some Policy Owners may hold Policies which, when originally issued,
provided for an Allowed Amount which was equal to the sum of (1) all Premiums,
not previously withdrawn and held more then seven Policy Years plus (2) 10% of
Premiums held between one and seven Policy Years not reduced by any withdrawals
made from such Premiums. Under these Policies, withdrawals were made first from
Premiums (on a first in first out basis) then from earnings. The Allowed Amount
applicable to these Policy Owners will be determined by whichever formula
provides them with the larger amount available, for full surrenders only,
without a Contingent Deferred Sales Load.
In addition, no Contingent Deferred Sales Load is assessed: (a) upon
annuitization to an option involving life contingencies on or after the third
Policy Anniversary; (b) on distributions resulting from the death of the Owner
or Annuitant before the Annuity Date; (c) upon withdrawals of Policy Value among
the Sub-Accounts under the Systematic Withdrawal Option; (d) or, in some
circumstances, under the Automatic Payout Option. Any applicable Contingent
Deferred Sales Load will be deducted from the amount requested for both partial
withdrawals and full surrenders.

<PAGE>

Administrative Charges

At the end of each Policy Year before the Annuity Date, Transamerica
deducts an annual Policy Fee as partial compensation for expenses relating to
the issue and maintenance of the Policy and the Variable Account. The annual
Policy Fee is equal to the lesser of $30 or 2% of the Policy Value. No Policy
Fee will be deducted for a Policy Year if the Policy Value exceeds $50,000 on
the last business day of the Policy Year or as of the date the Policy is
surrendered. The Policy Fee may be changed upon 30 days advance written notice,
subject to the prior approval of the New York State Insurance Department but in
no event may it exceed the lesser of $60 or 2% of the Policy Value. Such
increases in the Policy Fee will apply only to future deductions after the
effective date of the change. If the Policy is surrendered on other than the end
of a Policy Year, the Policy Fee will be deducted in full at the time of such
surrender. The Policy Fee will be deducted on a pro rata basis from each
Sub-Account in which the Policy is invested at the time of such deduction.
After the Annuity Date, an annual Annuity Fee of $30 will be deducted
in equal amounts from each Variable Annuity Payment made during the year ($2.50
each month if monthly payments). This fee will not be changed. No Annuity Fee
will be deducted from Fixed Annuity Payments.
Transamerica also makes a deduction (the Administrative Expense Charge)
from the Variable Account at the end of each Valuation Period (both before and
after the Annuity Date) at an effective current annual rate of 0.15% of assets
held in each Sub-Account for those administrative expenses attributable to the
Policies and the Variable Account which exceed the revenues received from the
Policy Fee, any Transfer Fee, and any fee imposed for Systematic Withdrawals.
Transamerica has the ability to increase or decrease this charge, but the charge
is guaranteed not to exceed 0.25%. Transamerica will provide 30 days written
notice of any change in fees. The administrative charges do not bear any
relationship to the actual administrative costs of a particular Policy. The
Administrative Expense Charge is reflected in the Variable Accumulation or
Variable Annuity Unit Values for each Sub-Account. Mortality and Expense Risk
Charge
Transamerica imposes a charge called the Mortality and Expense Risk
Charge to compensate it for bearing certain mortality and expense risks under
the Policies. For assuming these risks, Transamerica makes a daily charge equal
to 0.003403% corresponding to an effective annual rate of 1.25% of the value of
the net assets in the Variable Account. This charge is imposed before the
Annuity Date and if an Annuity Purchase Amount is applied to a Variable Payment
Option, also after the Annuity Date. Transamerica guarantees that this charge of
1.25% will never increase.
The Mortality and Expense Risk Charge is reflected in the Variable
Accumulation or Variable Annuity Unit Values for each Sub-Account.
Variable Accumulated Values and Variable Annuity Payments are not
affected by changes in actual mortality experience incurred by Transamerica. The
mortality risks assumed by Transamerica arise from its contractual obligations
to make Annuity Payments (determined in accordance with the annuity tables and
other provisions contained in the Policy) and to pay death benefits prior to the
Annuity Date. Thus Owners are assured that neither the Annuitant's own longevity
nor an unanticipated improvement in general life expectancy will adversely
affect the Annuity Payments under the Policy.
Transamerica also bears substantial risk in connection with the death
benefit before the Annuity Date, since it will pay a death benefit that may be
greater than the Policy Value. In this way, Transamerica bears the risk of
unfavorable experience in the Sub-Accounts.
The expense risk assumed by Transamerica is the risk that
Transamerica's actual expenses in administering the Policy and the Variable
Account will exceed the amount recovered through the Administrative Expense
Charge, Policy Fees, Transfer Fees and any fees imposed for Systematic
Withdrawals.
If the Mortality and Expense Risk Charge is insufficient to cover
actual costs and risks assumed, the loss will fall on Transamerica. Conversely,
if this charge is more than sufficient, any excess will be profit to
Transamerica. Currently, Transamerica expects a profit from this charge.
Transamerica anticipates that the Contingent Deferred Sales Load will
not generate sufficient funds to pay the cost of distributing the Policies. To
the extent that the Contingent Deferred Sales Load is insufficient to cover the
actual cost of Policy distribution, the deficiency will be met from
Transamerica's general corporate assets which may include amounts, if any,
derived from the Mortality and Expense Risk Charge. Premium Taxes
Currently, New York has no premium tax or retaliatory premium tax. If
New York imposes these taxes in the future, or if the Owner is or becomes a
resident of a state where such taxes apply, Transamerica will deduct applicable
premium

<PAGE>

taxes, including any retaliatory taxes, paid with respect to a particular Policy
from the Premiums, from amounts withdrawn, or from amounts applied on the
Annuity Date.
In certain limited circumstances, a broker-dealer or other entity
distributing the Policies may elect to pay to
Transamerica an amount equal to the premium taxes that would otherwise be
attributable to that entity's customers. In such
cases, Transamerica will not impose a premium tax charge on those Policies.
Transfer Fee
Transamerica currently does not charge for transfers between Sub-
Accounts. However, Transamerica may impose
a fee for each transfer in excess of the first twelve in a single Policy Year.
Transamerica will deduct the charge from the
amount transferred. This fee would be the lesser of $10 or 2% of the amount
transferred and would be used to help cover
Transamerica's costs of processing transfers. Currently, no fee is charged for
Automatic Asset Rebalancing. However,
Transamerica reserves the right to impose a nominal fee.
Systematic Withdrawal Option
Transamerica reserves the right to impose an annual fee of an amount
not to exceed $25 for administrative expenses
associated with processing systematic withdrawals. This fee, which is currently
waived, will be deducted from each systematic
withdrawal in equal installments during a Policy Year.
Taxes
Under present laws, Transamerica will incur state or local taxes (in
addition to the premium taxes described above) in several states. No charges are
currently made for taxes other than state premium taxes. However, Transamerica
reserves the right to deduct charges in the future for federal, state and local
taxes or the economic burden resulting from the application of any tax laws that
Transamerica determines to be attributable to the Policies. Portfolio Expenses
The value of the assets in the Variable Account reflects the value of
Portfolio shares and therefore the fees and expenses paid by each Portfolio. A
complete description of the fees, expenses, and deductions from the Portfolios
are found in the Funds' prospectuses. (See "The Funds" page 17.)

ANNUITY PAYMENTS

Annuity Date
Initially, the Annuity Date is selected by the Owner at the time the
Initial Premium is paid. Thereafter, the Annuity Date may be changed from time
to time by the Owner by giving notice to the Service Center provided that notice
of each change is received by the Service Center at least thirty (30) days prior
to the then-current Annuity Date. The Annuity Date must not be earlier than the
third Policy Anniversary. The latest Annuity Date which may be elected is the
first day of the calendar month immediately preceding the month of the
Annuitant's 85th birthday.
The Annuity Date must be the first day of a calendar month. The first
Annuity Payment will be on the first day of
the month immediately following the Annuity Date.
Annuity Payment
The Annuity Date is the date that the Annuity Purchase Amount is
applied to provide the Annuity Payments under the Policy under the selected
Annuity Form and Payment Option, unless the entire Policy Value has been
withdrawn or the death benefit has been paid to the Beneficiary prior to that
date. The Annuity Purchase Amount is the Policy Value, less any applicable
Contingent Deferred Sales Load and less any applicable premium taxes. Any
Contingent Deferred Sales Load will be waived if values are applied to an
Annuity Form involving life contingencies on or after the third Policy
Anniversary.
If the amount of the monthly Annuity Payment from any of the Payment
Options selected by the Owner would result in a monthly Annuity Payment of less
than $20, or if the Annuity Purchase Amount is less than $2,000, Transamerica
reserves the right to offer a less frequent mode of payment or pay the Policy
Value in a cash payment. Monthly Annuity Payments from the Variable Annuity
Payment Option will further be subject to a minimum monthly annuity amount of
$50 from each Sub-Account of the Variable Account from which such payments are
made.
The Owner may choose from the Annuity Forms below. Transamerica may
consent to other plans of payment before the Annuity Date. For Annuity Forms
involving life income, the actual age and/or sex of the Annuitant, or a Joint or
Contingent Annuitant will affect the amount of each payment. Sex-distinct rates
generally are not allowed under certain Qualified Policies. Transamerica
reserves the right to ask for satisfactory proof of the Annuitant's (or Joint or
Contingent Annuitant's) age. Transamerica may delay Annuity Payments until
satisfactory proof is received. Since payments to older Annuitants are expected
to be fewer in number, the amount of each Annuity Payment under a selected
Annuity Form shall be greater for older Annuitants than for younger Annuitants.

<PAGE>

The Owner may choose from the two Annuity Payment Options described
below. The Annuity Date and Annuity Forms available for Qualified Policies may
also be controlled by endorsements, the plan or applicable law.
A portion or the entire amount of the Annuity Payments may be taxable
as ordinary income. If, at the time the Annuity Payments begin, Transamerica has
not received a proper written election not to have federal income taxes
withheld, Transamerica must by law withhold such taxes from the taxable portion
of such annuity payments and remit that amount to the federal government. State
income tax withholding may also apply. (See "Federal Tax Matters" page 32.)
Election of Annuity Forms and Payment Options
The Annuity Form and Payment Option for each Policy is set as a 120
month period certain and life Annuity Form, under the Variable Payment Option.
Before the Annuity Date, and while the Annuitant is living, the Owner
may, by Written Request, change the Annuity Form or Annuity Payment Option or
may request payment of the Cash Surrender Value for the Policy. The request for
change of the Annuity Date or Annuity Payment Option must be received by the
Service Center at least 30 days prior to the Annuity Date.
In the event that an Annuity Form and Payment Option are not selected
at least 30 days before the Annuity Date,
Transamerica will make Variable Annuity Payments in accordance with the 120
month period certain and life Annuity Form
and the applicable provisions of the Policy.
Annuity Payment Options
The Annuity Forms may be paid under Fixed or Variable Annuity Payment
Options. Under the Fixed Annuity Payment Option, the amount of each payment will
be determined on the Annuity Date and will not subsequently be affected by the
investment performance of the Sub-Accounts. Under the Variable Annuity Payment
Option, the Annuity Payments, after the first Annuity Payment, will reflect the
investment experience of the Sub-Account or Sub- Accounts chosen by the Owner.
Owners may elect a Fixed Annuity, a Variable Annuity, or a combination
of both (in 25% increments of the Annuity Purchase Amount). If the Owner elects
a combination, he or she must specify what part of the Annuity Purchase Amount
is to be applied to the Fixed and Variable Payment Options. Unless specified
otherwise, the applied Annuity Purchase Amount will be used to provide a
Variable Annuity. In this event, the initial allocation of Variable Annuity
Units for the Variable Sub-Accounts will be in proportion to the Policy's value
in the Sub-Accounts on the Annuity Date. Fixed Annuity Payment Option
A Fixed Annuity provides for Annuity Payments which will remain
constant pursuant to the terms of the Annuity Form elected. If a Fixed Annuity
is selected, the portion of the Annuity Purchase Amount used to provide the
Fixed Annuity will be transferred to the general account assets of Transamerica,
and the amount of Annuity Payments will be established by the fixed annuity
provisions selected and the age and sex (if sex-distinct rates are allowed by
law) of the Annuitant and will not reflect investment experience after the
Annuity Date. The Fixed Annuity Payment amounts are determined by applying the
Annuity Purchase Rate specified in the Policy to the portion of the Annuity
Purchase Amount applied to the Fixed Annuity Option by the Owner. Payments may
vary after the death of the Annuitant under some Annuity Options; the amounts of
these variances are fixed on the Annuity Date. Variable Annuity Payment Option
A Variable Annuity provides for payments that vary in dollar amount,
based on the investment performance of the selected Sub-Account(s) of the
Variable Account. The Variable Annuity Purchase Rate Tables in the Policy
reflect an assumed annual interest rate of 4%, so if the actual net investment
performance of the Sub-Account(s) is less than this rate, then the dollar amount
of the actual Annuity Payments will decrease. If the actual net investment
performance of the Sub-Account(s) is higher than this rate, then the dollar
amount of the actual Annuity Payments will increase. If the net investment
performance exactly equals the 4% rate, then the dollar amount of the actual
Annuity Payments will remain constant.
Variable Annuity Payments will be based on the Sub-Accounts selected by
the Owner, and on the allocations among the Sub-Accounts.
For further details as to the determination of Variable Annuity
Payments, see the Statement of Additional
Information.
Annuity Forms
The Owner may choose any of the Annuity Forms described below. Subject
to approval by Transamerica, the Owner may select any other Annuity Forms then
being offered by Transamerica.
(1) Life Annuity. Payments start on the first day of the month
immediately following the Annuity Date, if the
Annuitant is living. Payments end with the payment due just before the
Annuitant's death. There is no death benefit under

<PAGE>

this form. It is possible that only one payment will be made under this form if
the Annuitant dies before the second payment is due; only two payments will be
made if the Annuitant dies before the third payment is due, and so forth.
(2) Life and Contingent Annuity. Payments start on the first day of the
month immediately following the Annuity Date, if the Annuitant is living.
Payments will continue for as long as the Annuitant lives. After the Annuitant
dies, payments will be made to the Contingent Annuitant, if living, for as long
as the Contingent Annuitant lives. The continued payments can be in the same
amount as the original payments, or in an amount equal to one-half or two-thirds
thereof. Payments will end with the payment due just before the death of the
Contingent Annuitant. There is no death benefit after both die. If the
Contingent Annuitant does not survive the Annuitant, payments will end with the
payment due just before the death of the Annuitant. It is possible that only one
payment or very few payments will be made under this form, if the Annuitant and
Contingent Annuitant die shortly after payments begin.
The Written Request for this form must: (a) name the Contingent
Annuitant; and (b) state the percentage of payments for the Contingent
Annuitant. Once Annuity Payments start under this Annuity Form, the person named
as Contingent Annuitant for purposes of being the measuring life, may not be
changed. Transamerica will require proof of age for the Annuitant and for the
Contingent Annuitant before payments start.
(3) Life Annuity With Period Certain. Payments start on the first day
of the month immediately following the
Annuity Date, if the Annuitant is living. Payments will be made for the longer
of: (a) the Annuitant's life: or (b) the period
certain. The period certain may be 120 or 180 or 240 months, but in no event
may it exceed the life expectancy of the
Annuitant.
If the Annuitant dies after all payments have been made for the period
certain, payments will cease with the payment due just before the Annuitant's
death. No benefit will then be payable to the Annuitant's Beneficiary.
If the Annuitant dies during the period certain, the rest of the period
certain payments will be made to the Annuitant's Beneficiary. The Owner may
elect to have the commuted value of these payments paid in a single sum.
Transamerica will determine the commuted value by discounting the rest of the
payments at the then current rate of interest used for commuted values.
If the Owner does not elect to have the commuted value paid in a single
sum after the Annuitant's death, the Owner may designate a Payee to receive any
remaining payments payable if the Annuitant's Beneficiary dies before all of the
payments under the period certain have been made. If the Annuitant's Beneficiary
dies before receiving all of the remaining period certain payments and a
designated Payee does not survive the Annuitant's Beneficiary for at least 30
days, then the remaining payments will be paid to the Owner, if living,
otherwise in a single sum to the Owner's estate.
The Written Request for this form must: (a) state the length of the
period certain; and (b) name the Annuitant's
Beneficiary.
(4) Joint and Survivor Annuity. Payments will be made, starting on the
first day of the month immediately following the Annuity Date, if and for as
long as the Annuitant and Joint Annuitant are living. After the Annuitant or
Joint Annuitant dies, payments will continue as long as the survivor lives. The
continued payments can be in the same amount as the original payments, or in an
amount equal to one-half or two-thirds thereof. It is possible that only one
payment or very few payments will be made under this form if the Annuitant and
Joint Annuitant both die shortly after payments begin.
The Written Request for this form must: (a) name the Joint Annuitant;
and (b) state the percentage of continued payments for the survivor. Once
payments start under this Annuity Form, the person named as Joint Annuitant, for
the purpose of being the measuring life, may not be changed. Transamerica will
need proof of age for the Joint Annuitant before payments start.
(5) Other Forms of Payment. Benefits can be provided under any other
Annuity Form not described in this section subject to Transamerica's agreement
and any applicable state or federal law or regulation. Requests for any other
Annuity Form must be made in writing to the Service Center at least 30 days
before the Annuity Date.
Once payments start under the Annuity Form and Payment Option selected
by the Owner: (a) no changes can be made in the Annuity Form and Payment Option;
(b) no additional Premium will be accepted under the Policy; and (c) no further
withdrawals will be allowed.
The Owner may, at any time after the Annuity Date by Written Notice to
us at our Service Center, change the Payee
of annuity benefits being provided under the Policy. The effective date of
change in Payee will be the later of: (a) the date
we receive the Written Request for such change; or (b) the date specified by
the Owner. If the Policy is issued as an IRA,
the Owner may not change the Payee on or after the Annuity Date.
Alternate Fixed Annuity Rates
The amount of any Fixed Annuity Payments will be determined on the
Annuity Date by using either the guaranteed fixed annuity rates or
Transamerica's current single premium fixed annuity rates at the time, whichever
would result in a higher amount of monthly Fixed Annuity Payments.

<PAGE>

QUALIFIED POLICIES

The Policy may be used to fund IRA rollovers and, with Transamerica's
prior permission, to fund contributory IRA's, for use in connection with Section
408(b) of the Code. A rollover IRA is one whose initial Premium is from the
rollover of certain kinds of distributions from qualified plans, Section 403(b)
tax sheltered annuities and individual retirement plans, following the rules set
out in the Code to maintain favorable tax treatment for the individual
retirement annuity. A contributory IRA is one to which initial and subsequent
Premiums are subject to limitations imposed by the Code.
With Transamerica's prior permission, the Policy may also be used for
various types of qualified pension and profit sharing plans under Section 401 of
the Code, which permits corporate employers to establish various types of
retirement plans for employees, and as Section 403(b) annuities. Currently,
additional Premiums after the initial Premium may not be made to Policies used
as Section 403(b) annuities. The tax rules applicable to distribution from
qualified retirement plans, including restrictions on contributions and
benefits, taxation of distributions, any tax penalties, vary according to the
type of plan and the terms and conditions of the plan itself. Various tax
penalties may apply to contributions in excess of specified limits, aggregate
distributions in excess of specified amount, distributions prior to age 59 1/2
(subject to certain exceptions), distributions that do not satisfy specified
requirements and certain other transactions with subject to qualified plans.
Purchasers of the Policies for use in qualified plans should seek competent
advice regarding the suitability of the proposed plan documents and the Policies
to their specific needs. Transamerica reserves the right to decline to sell the
Policy to certain qualified plans or terminate the contract if in Transamerica's
judgment the Policy is not appropriate for the plan.
If a Policy is purchased to fund an IRA, the Annuitant must also be the
Owner. In addition, under current tax law, if a Policy is purchased to fund an
IRA, minimum distributions from IRA's must commence not later than April 1st of
the calendar year following the calendar year in which the Owner attains age 70
1/2. The Owner should consult his/her tax adviser concerning these matters.
Withholding

A distributee receiving withdrawals from certain Qualified Policies may
not be entitled to elect, not to have income tax withholding apply. The federal
income withholding rate in the case of certain Qualified Policy, but not IRA's
is 20% of the taxable amount of the withdrawal.
Since the Qualified Policy offered by the Prospectus will be issued in
connection with retirement plans which meet the requirements of Sections 401,
403(b), or 408(b) of the Code, reference should be made to the terms of the
particular retirement plan and the Code for any additional limitations or
restrictions on cash withdrawals.
Automatic Payout Option ("APO")
Prior to the Annuity Date, for Qualified Policy only, the Owner may
elect the Automatic Payout Option ("APO") to satisfy minimum distribution
requirements under Sections 401(a)(9), 403(b), and 408(b)(3) of the Code with
regard to this Policy. This may be elected no earlier than six months prior to
the calendar year in which the Owner attains age 70 1/2, but payments may not
begin earlier than January of such calendar year. Additionally, APO withdrawals
may not begin before the later of (a) 30 days after the Policy Date or (b) the
end of the Free Look Period. APO may be elected in any calendar month, but no
later than the month in which the Owner attains age 84.
APO withdrawals will be from the Sub-Account(s) and in the percentage
allocations specified by the Owner. If no specifications are made, withdrawals
will be pro rata from all Sub-Account(s) with value. Withdrawals can not be made
from a Sub-Account from which Dollar Cost Averaging transfers are being made.
Payments will be made annually, and will continue unless terminated by
the Owner or automatically terminated by Transamerica as set forth in the
Policy. Once terminated, APO may not be elected again.

If only APO withdrawals are made, no Contingent Deferred Sales Load
will apply, regardless of the "Allowed Amount" (described on page 26). However,
if a partial withdrawal is taken, that partial withdrawal and any subsequent
withdrawals that Policy Year will be subject to a Contingent Deferred Sales
Charge to the extent they exceed the "Allowed Amount." (See "Contingent Deferred
Sales Load" page 26.)
To be eligible for this option, the following conditions must be met:
(1) the Policy Value must be at least $12,000 at the time of election; and (2)
the annual withdrawal amount is the larger of the required minimum distribution
under Code Sections 401(a)(9) or 408(b)(3) or $500 .
APO allows the required minimum distribution to be paid from the
Sub-Account(s) of the Variable Account. If there are insufficient funds in the
Variable Account to make a withdrawal, or for other reasons as set forth in the
Policy,

<PAGE>

this option will terminate.
If you have more than one qualified plan subject to the Code's minimum
distribution requirements, you must consider all such plans in the calculation
of your minimum distribution requirement, but Transamerica will make
calculations and distribution with regard to this Policy only. Restrictions
under Section 403(b) Programs

Certain restrictions apply to annuity contracts used in connection with
Internal Revenue Code Section 403(b) retirement plans. Section 403(b) of the
Internal Revenue Code provides for tax-deferred retirement savings plans for
employees of certain non-profit and educational organizations. In accordance
with the requirements of the Code, Section 403(b) annuities generally may not
permit distribution of (i) elective contributions made in years beginning after
December 31, 1988, and (ii) earnings on those contributions and (iii) earnings
on amounts attributable to elective contributions held as of the end of the last
year beginning before January 1, 1989. Distributions of such amounts will be
allowed only upon death of the employee, on or after attainment of age 59 1/2,
separation from service, disability, or financial hardship, except that income
attributable to elective contributions may not be distributed in the case of
hardship.

FEDERAL TAX MATTERS

Introduction
The following discussion is a general description of federal tax
considerations relating to the Policy and is not intended as tax advice. This
discussion is not intended to address the tax consequences resulting from all of
the situations in which a person may be entitled to or may receive a
distribution under the Policy. Any person concerned about these tax implications
should consult a competent tax adviser before initiating any transaction. This
discussion is based upon Transamerica's understanding of the present federal
income tax laws as they are currently interpreted by the Internal Revenue
Service. No representation is made as to the likelihood of the continuation of
the present federal income tax laws or of the current interpretation by the
Internal Revenue Service. Moreover, no attempt has been made to consider any
applicable state or other tax laws.
The Policy may be purchased on a non-tax qualified basis
("Non-Qualified Policy") or purchased and used in connection with plans
qualifying for special tax treatment ("Qualified Policy"). Qualified Policies
are designed for use by individuals solely as plans entitled to special income
tax treatment under section 408 of the Code. The ultimate effect of federal
income taxes on the amounts held under a Policy, on Annuity Payments, and on the
economic benefit to the Owner, the Annuitant, or the Beneficiary may depend on
the type of retirement plan, and on the tax status of the individual concerned.
In addition, certain requirements must be satisfied in purchasing a Qualified
Policy with proceeds from a tax qualified retirement plan and receiving
distributions from a Qualified Policy in order to continue receiving special tax
treatment. Therefore, purchasers of Qualified Policies should seek competent
legal and tax advice regarding the suitability of the Policy for their
situation, the applicable requirements, and the tax treatment of the rights and
benefits of the Policy. The following discussion assumes that a Qualified Policy
is purchased with proceeds from and/or contributions under retirement plans that
qualify for the intended special federal income tax treatment.
The following discussion is based on the assumption that the Policy
qualifies as an annuity contract for federal
income tax purposes. The Statement of Additional Information discusses the
requirements for qualifying as an annuity.
Taxation of Annuities
In General
Section 72 of the Code governs taxation of annuities in general.
Transamerica believes that the Owner who is a natural person generally is not
taxed on increases in the value of a Policy until distribution occurs by
withdrawing all or part of the Policy Value (e.g., withdrawals or Annuity
Payments under the Annuity Option elected). For this purpose, the assignment,
pledge, or agreement to assign or pledge any portion of the Policy Value (and in
the case of a Qualified Policy, any portion of an interest in the plan)
generally will be treated as a distribution. The taxable portion of a
distribution (in the form of a single sum payment or an annuity) is taxable as
ordinary income.
The Owner of any Non-Qualified Policy who is not a natural person
generally must include in income any increase in the excess of the Policy Value
over the "investment in the contract" (discussed below) during the taxable year.
There are some exceptions to this rule and a prospective Owner that is not a
natural person may wish to discuss these with a competent tax adviser.
The following discussion generally applies to Policies owned by a
natural persons.

<PAGE>

Withdrawals

In the case of a withdrawal under a Qualified Policy, including
withdrawals under the Systematic Withdrawal Option or the Automatic Payout
Option, a ratable portion of the amount received is taxable, generally based on
the ratio of the "investment in the contract" to the individual's total accrued
benefit under the retirement plan. The "investment in the contract" generally
equals the amount of any non-deductible Premiums paid by or on behalf of any
individual. For a Qualified Policy, the "investment in the contract" can be
zero. Special tax rules may apply to certain distributions from a Qualified
Policy.

With respect to Non-Qualified Policies, partial withdrawals, including
withdrawals under the Systematic Withdrawal Option, are generally treated as
taxable income to the extent that the Policy Value immediately before the
withdrawal exceeds the "investment in the contract" at that time. Full
surrenders are treated as taxable income to the extent that the amount received
exceeds the "investment in the contract."
Annuity Payments
Although the tax consequences may vary depending on the Annuity Payment
elected under the Policy, in general, only the portion of the Annuity Payment
that represents the amount by which the Policy Value exceeds the "investment in
the contract" will be taxed; after the "investment in the contract" is
recovered, the full amount of any additional Annuity Payments is taxable. For
Variable Annuity Payments, the taxable portion is generally determined by an
equation 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. However, the entire
distribution will be taxable once the recipient has recovered the dollar amount
of his or her "investment in the contract." For Fixed Annuity Payments, in
general there is no tax on the portion of each payment which represents the same
ratio that the "investment in the contract" bears to the total expected value of
the Annuity Payments for the term of the payments; however, the remainder of
each Annuity Payment is taxable. Once the "investment in the contract" has been
fully recovered, the full amount of any additional Annuity Payments is taxable.
If Annuity Payments cease as a result of an Annuitant's death before full
recovery of the "investment in the contract," consult a competent tax advisor
regarding deductibility of the unrecovered amount.
Penalty Tax
In the case of a distribution pursuant to a Non-Qualified Policy, there
may be imposed a federal income tax penalty equal to 10% of the amount treated
as taxable income. In general, however, there is no penalty tax on
distributions: (1) made on or after the date on which the Owner attains age 59
1/2; (2) made as a result of death or disability of the Owner; or (3) received
in substantially equal periodic payments as a life annuity or a joint and
survivor annuity for the lives or life expectancies of the Owner and a Joint
Owner. Other tax penalties may apply to certain distributions under a Qualified
Policy.
Taxation of Death Benefit Proceeds

Amounts may be distributed from the Policy because of the death of an
Owner or the Annuitant. Generally such amounts are includible in income as
follows: (1) if distributed in a lump sum, they are taxed in the same manner as
a full surrender, as described above, or (2) if distributed under an Annuity
Option, they are taxed in the same manner as Annuity Payments, as described
above. For these purposes, the investment in the Policy is not affected by the
Owner's or Annuitant's death. That is, the investment in the Policy remains the
amount of any Premiums paid which were not excluded from gross income. Other
rules relating to distributions at death apply to Qualified Policies. You should
consult your legal counsel and tax adviser regarding these rules and their
impact on Qualified Policies.

Required Distributions upon Owner's Death

Notwithstanding any provision of the Policy or this prospectus to the
contrary, no payment of benefits provided under the Policy will be allowed that
does not satisfy the requirements of Section 72(s) of the Code.
Notwithstanding any other provision of the Policy or this prospectus,
if the Owner dies before the Annuity Date, the Death Benefit payable to the
Owner's Beneficiary will be distributed as follows:

(a) the Death Benefit must be completely distributed within five years
of the Owner's date of death; or (b) the Owner's Beneficiary may elect,
within the one year period after the Owner's date of death, to receive
the Death Benefit in the form of an annuity from us, provided
that: (1) such annuity is distributed in substantially equal
installments over the life of such Owner's Beneficiary or over
a period not extending beyond the life expectancy of such
Owner's Beneficiary; and (2) such distributions begin not
later than one year after the Owner's date of death.

Notwithstanding (a) and (b) above, if the sole Owner's Beneficiary is
the deceased Owner's surviving spouse, then such spouse may elect, within the
one year period after the Owner's date of death, to continue the Policy under
the same terms as before the Owner's death. Upon receipt of such election from
the spouse, in a form and manner acceptable to us, at our Service Office: (1)
all rights of the spouse as Owner's Beneficiary under the Policy in effect prior
to such election will cease; (2) the spouse will become the Owner of the Policy
and will also be treated as the

<PAGE>

Contingent Annuitant, if none has been named and only if the deceased Owner was
the Annuitant; and (3) all rights and privileges granted by the Policy or
allowed by Transamerica will belong to the spouse as Owner of the Policy. This
election will be deemed to have been made by the spouse if such spouse makes a
Premium payment to the Policy or fails to make a timely election as described in
this paragraph.

If the Owner's Beneficiary is a nonspouse, the distribution provisions
described in subparagraphs (a) and (b) above, will apply even if the Annuitant
and/or Contingent Annuitant are alive at the time of the Owner's death. If the
nonspouse Owner's Beneficiary is not an individual, then only a cash payment
will be paid.

If no election is received by us from a nonspouse Owner's Beneficiary
within the one year period after the Owner's date of death, then we will pay the
Death Benefit to the Owner's Beneficiary in a cash payment. The Death Benefit
will be determined as of the date we make the cash payment. Such cash payment
will be in full settlement of all our liability under the Policy.

If Annuitant Dies After Annuity Starts - If the Annuitant dies after
the annuity starts, any benefit payable will be distributed at least as rapidly
as under the Annuity Form then in effect.

If Owner Dies After Annuity Starts - If the Owner dies after the
annuity starts, any benefit payable will continue to be distributed at least as
rapidly as under the Annuity Form then in effect. All of the Owner's rights
granted under the Policy or allowed by us will pass to the Owner's Beneficiary.
Joint Ownership - For purposes of this section, if the Policy has Joint
Owners we will consider the date of death of the first Joint Owner as the death
of the Owner and the surviving Joint Owner will become the Owner of the Policy.

Transfers, Assignments, or Exchanges of the Policy
A transfer of ownership of a Non-Qualified Policy, the designation of
an Annuitant, Payee, or Beneficiary who is not also the Owner, or the exchange
of a Policy may result in certain tax consequences to the Owner that are not
discussed herein. An Owner contemplating any such designation, transfer,
assignment, or exchange should contact a competent tax adviser with respect to
the potential tax effects of such a transaction. Certain Qualified Policies
cannot be transferred or assigned.
Multiple Policies

All deferred non-qualified annuity policies that are issued by
Transamerica (or its affiliates) to the same Owner during any calendar year are
treated as one annuity policy for purposes of determining the amount includible
in gross income under section 72(e) of the Code. In addition, the Treasury
Department has specific authority to issue regulations that prevent the
avoidance of section 72(e) through the serial purchase of annuity policies or
otherwise. Congress has also indicated that the Treasury Department may have
authority to treat the combination purchase of an immediate annuity policy and
separate deferred annuity policies as a single annuity policy under its general
authority to prescribe rules as may be necessary to enforce the income tax laws.
Qualified Policies

In General

The Qualified Policy is designed for use as a rollover IRA. With
Transamerica's prior permission, the Policy may also be used as a contributory
IRA, as a Section 403(b) annuity, and for use in qualified pension and profit
sharing plans established by Corporate employers. The tax rules applicable to
participants and beneficiaries in retirement plans vary according to the type of
plan and the terms and conditions of the plan. Special favorable tax treatment
may be available for certain types of contributions and distributions. Adverse
tax consequences may result from contributions in excess of specified limits;
distributions prior to age 59 1/2 (subject to certain exceptions); distributions
that do not conform to specified commencement and minimum distribution rules;
aggregate distributions in excess of a specified annual amount; and in other
specified circumstances. We make no attempt to provide more than general
information about use of the Policies with the various types of retirement
plans. Owners and participants under retirement plans as well as annuitants and
beneficiaries are cautioned that the rights of any person to any benefits under
Qualified Policies may be subject to the terms and conditions of the plans
themselves, regardless of the terms and conditions of the Policy issued in
connection with such a plan. Some retirement plans are subject to distribution
and other requirements that are not incorporated in the administration of the
Policies. Owners are responsible for determining that contributions,
distributions and other transactions with respect to the Policies satisfy
applicable law. Purchasers of Policies for use with any retirement plan should
consult their legal counsel and tax adviser regarding the suitability of the
Policy.

Qualified Pension and Profit Sharing Plans

Section 401(a) of the Code permits employers to establish various
types of retirement plans for employees. Such
retirement plans may permit the purchase of the Policy in order to provide
retirement savings under the plans. The

<PAGE>

Self-Employed Individuals' Tax Retirement Act of 1962, as amended, commonly
referred to as "H.R. 10," also permits self-employed individuals to establish
qualified plans for themselves and their employees. Adverse tax consequences to
the plan, to the participant or to both may result if this Policy is assigned or
transferred to any individual as a means to provide benefits payments.
Purchasers of a Policy for use with such plans should seek competent advice
regarding the suitability of the proposed plan documents and the Policy to their
specific needs. The Policy is designed to invest retirement savings and not to
distribute retirement benefits.

Individual Retirement Annuities

The Policy is designed for use with IRA rollovers and direct transfers.
Section 408 of the Code permits eligible individuals to contribute to an
individual retirement program known as an Individual Retirement Annuity or
Individual Retirement Account (each hereinafter referred to as an "IRA"). Also,
distributions from certain other types of qualified plans may be "rolled over"
on a tax-deferred basis into an IRA. The sale of a Policy for use with an IRA
may be subject to special disclosure requirements of the Internal Revenue
Service. Purchasers of a Policy for use with IRAs will be provided with
supplemental information required by the Internal Revenue Service or other
appropriate agency. Such purchasers will have the right to revoke their purchase
within 7 days of the earlier of the establishment of the IRA or their purchase.
Various tax penalties may apply to contributions in excess of specified limits,
aggregate distributions in excess of certain annual limits, distributions that
do not satisfy specified requirements, and certain other transactions. A
Qualified Policy will be amended as necessary to conform to the requirements of
the Code. Purchasers should seek competent advice as to the suitability of the
Policy for use with IRAs.

Section 403(b) Plans
Under Code Section 403(b), payments made by public school systems and
certain tax exempt organizations to purchase annuity contracts for their
employees are excludable from the gross income of the employee, subject to
certain limitations. However, these payments may be subject to FICA (Social
Security) taxes.
Code Section 403(b)(11) restricts the distribution under Code Section
403(b) annuity contracts of: (1) elective contributions made in years beginning
after December 31, 1988; (2) earnings on those contributions; and (3) earnings
in such years on amounts held as of the last year beginning before January 1,
1989. Distribution of those amounts may only occur upon death of the employee,
attainment of age 59 1/2, separation from service, disability, or financial
hardship. In addition, income attributable to elective contributions may not be
distributed in the case of hardship.
Withholding
Pension and annuity distributions generally are subject to withholding
for the recipient's federal income tax liability at rates that vary according to
the type of distribution and the recipient's tax status. Recipients, however,
generally are provided the opportunity to elect not to have tax withheld from
distributions. Federal income tax withholding is mandatory for certain
distributions from Section 401 or Section 403(b) retirement plans.

Restrictions under Qualified Policies
Other restrictions with respect to the election, commencement, or
distribution of benefits may apply under Qualified
Policies or under the terms of the plans in respect of which Qualified Policies
are issued.
Possible Changes in Taxation

In past years, legislation has been proposed that would have adversely
modified the federal taxation of certain annuities. For example, one such
proposal would have changed the tax treatment of non-qualified annuities that
did not have "substantial life contingencies" by taxing income as it is credited
to the annuity. Although, as of the date of this prospectus, Congress is not
actively considering any legislation regarding the taxation of annuities, there
is always the possibility that the tax treatment of annuities could change by
legislation or other means (such as IRS regulations, revenue rulings, judicial
decisions, etc.). Moreover, it is also possible that any change could be
retroactive (that is, effective prior to the date of the change). Other Tax
Consequences
As noted above, the foregoing discussion of the federal income tax
consequences is not exhaustive and special rules are provided with respect to
other tax situations not discussed in this Prospectus. Further, the federal
income tax consequences discussed herein reflect Transamerica's understanding of
current law and the law may change. Federal gift and estate tax consequences and
state and local estate, inheritance, and other tax consequences of ownership or
receipt of distributions under the Policy depend on the individual circumstances
of each Owner or recipient of the distribution. A competent tax adviser should
be consulted for further information. General

At the time the Initial Premium is paid, a prospective purchaser must
specify whether he or she is purchasing a Non-Qualified Policy or a Qualified
Policy. If the Initial Premium is derived from an exchange or surrender of
another annuity policy, Transamerica may require that the prospective purchaser
provide information with regard to the federal

<PAGE>

income tax status of the previous annuity policy. Transamerica will require that
persons purchase separate Policies if they desire to invest monies qualifying
for different annuity tax treatment under the Code. Each such separate Policy
would require the minimum Initial Premium stated above. Additional Premiums
under a Policy must qualify for the same federal income tax treatment as the
Initial Premium under the Policy; Transamerica will not accept an additional
Premium under a Policy if the federal income tax treatment of such Premium would
be different from that of the Initial Premium.

DISTRIBUTION OF THE POLICY

Transamerica Securities Sales Corporation ("TSSC") is the principal
underwriter of the Policies. TSSC may also serve as an underwriter and
distributor of other policies issued through the Variable Account and certain
other separate accounts of Transamerica and any affiliates of Transamerica. TSSC
is a wholly-owned subsidiary of Transamerica Insurance Corporation of
California, which is a subsidiary of Transamerica Corporation. TSSC is
registered with the Commission as a broker/dealer and is a member of the
National Association of Securities Dealers, Inc. ("NASD"). Its principal offices
are located at 1150 South Olive, Los Angeles, California 90015. Transamerica
pays TSSC for acting as the principal underwriter under a distribution
agreement.
TSSC has entered into sales agreements with other broker/dealers to
solicit applications for the Policies through registered representatives who are
licensed to sell securities and variable insurance products. These agreements
provide that applications for the Policies may be solicited by registered
representatives of the broker/dealers appointed by Transamerica to sell its
variable life insurance and variable annuities. These broker/dealers are
registered with the Commission and are members of the NASD. The registered
representatives are authorized under applicable state regulations to sell
variable life insurance and variable annuities.
Under the agreements, applications for Policies will be sold by
broker/dealers which will generally receive compensation of up to 6.25% of any
Initial and additional Premiums paid (although higher amounts may be paid in
certain circumstances). Additional amounts, including asset based trail
commissions, may be paid in certain circumstances.
Transamerica Financial Resources, Inc. ("TFR") also is an underwriter
and distributor of the Policies. TFR is a
wholly-owned subsidiary of Transamerica Insurance Corporation of California and
is registered with the Commission and
the NASD as a broker/dealer.

LEGAL PROCEEDINGS

There is no pending material legal proceeding affecting the Variable
Account. Transamerica is involved in various kinds of routine litigation which,
in management's judgment, are not of material importance to Transamerica's
assets or to the Variable Account.

LEGAL MATTERS

Advice regarding certain legal matters concerning the federal
securities laws applicable to the issue and sale of the Policies has been
provided by Sutherland, Asbill & Brennan. The organization of Transamerica, its
authority to issue the Policies and the validity of the form of the Policies
have been passed upon by James W. Dederer General Counsel of Transamerica.

ACCOUNTANTS

The financial statements of Transamerica for each of the three years in
the period ended December 31, 1996, and the financial statements of the Variable
Account at December 31, 1996, have been audited by Ernst & Young LLP,
Independent Auditors, as set forth in their reports appearing in the Statement
of Additional Information, and are included in reliance upon such reports given
upon the authority of such firm as experts in accounting and auditing.

VOTING RIGHTS

To the extent required by applicable law, all Portfolio shares held in
the Variable Account will be voted by Transamerica at regular and special
shareholder meetings of the respective Funds in accordance with instructions
received from persons having voting interests in the corresponding Sub-Account.
If, however, the 1940 Act or any regulation

<PAGE>

thereunder should be amended, or if the present interpretation thereof should
change, or if Transamerica determines that it is allowed to vote all Portfolio
shares in its own right, Transamerica may elect to do so.
The person with the voting interest is the Owner. The number of votes
which are available to an Owner will be calculated separately for each
Sub-Account of the Variable Account. Before the Annuity Date, that number will
be determined by applying his or her percentage interest, if any, in a
particular Sub-Account to the total number of votes attributable to that
Sub-Account. The Owner holds a voting interest in each Sub-Account to which the
Policy Value is allocated. After the Annuity Date, the number of votes decreases
as Annuity Payments are made and as the reserves for the Policy decrease.
The number of votes of a Portfolio 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 respective Funds.
Shares as to which no timely instructions are received and shares held
by Transamerica as to which Owners have no beneficial interest will be voted in
proportion to the voting instructions which are received with respect to all
Policies participating in the Sub-Account. 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.
Each person or entity having a voting interest in a Sub-Account will
receive proxy material, reports and other material relating to the appropriate
Portfolio.
It should be noted that the Funds are not required to, and do not
intend to, hold annual or other regular meetings of shareholders.

AVAILABLE INFORMATION

Transamerica has filed a registration statement (the "Registration
Statement") with the Securities and Exchange Commission under the Securities Act
of 1933 relating to the Policy offered by this Prospectus. This Prospectus has
been filed as a part of the Registration Statement and does not contain all of
the information set forth in the Registration Statement and exhibits thereto,
and reference is hereby made to such Registration Statement and exhibits for
further information relating to Transamerica and the Policy. Statements
contained in this Prospectus, as to the content of the Policy and other legal
instruments, are summaries. For a complete statement of the terms thereof,
reference is made to the instruments filed as exhibits to the Registration
Statement. The Registration Statement and the exhibits thereto may be inspected
and copied at the office of the Commission, located at 450 Fifth Street, N.W.,
Washington, D.C.

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION TABLE OF CONTENTS
A Statement of Additional Information is available which contains more
details concerning the subjects discussed in this Prospectus. The following is
the Table of Contents for that Statement:
<TABLE>
<CAPTION>

Page
<S> <C>
THE POLICY................................................................................................................3
DOLLAR COST AVERAGING.....................................................................................................3
NET INVESTMENT FACTOR.....................................................................................................3
ANNUITY PERIOD............................................................................................................3
Variable Annuity Units and Payments..............................................................................4
Variable Annuity Unit Value......................................................................................4
Transfers After the Annuity Date.................................................................................4

GENERAL PROVISIONS........................................................................................................4
IRS Required Distributions.......................................................................................4
Non-Participating................................................................................................4
Misstatement of Age or Sex.......................................................................................5
Proof of Existence and Age.......................................................................................5
Assignment.......................................................................................................5
Annuity Data.....................................................................................................5
Annual Report....................................................................................................5
Incontestability.................................................................................................5
Ownership........................................................................................................5
Entire Policy............................................................................................5
Changes in the Policy............................................................................................5
Protection of Benefits...........................................................................................5
Delay of Payments................................................................................................5
Notices and Directions...........................................................................................6

CALCULATION OF YIELDS AND TOTAL RETURNS...................................................................................6
Money Market Sub-Account Yield Calculation.......................................................................6
Other Sub-Account Yield Calculations.............................................................................6
Standard Total Return Calculations...............................................................................7
Hypothetical Performance Data....................................................................................7
Other Performance Data...........................................................................................7
HISTORIC PERFORMANCE DATA.................................................................................................8
General Limitations..............................................................................................8
Money Market Sub-Account Yields..................................................................................8
Hypothetical Sub-Account Performance Figures.....................................................................8
FEDERAL TAX MATTERS......................................................................................................11
Taxation of Transamerica........................................................................................11
Tax Status of the Policies......................................................................................11
DISTRIBUTION OF THE POLICY...............................................................................................12
SAFEKEEPING OF ACCOUNT ASSETS............................................................................................12
TRANSAMERICA.............................................................................................................13
General Information and History.................................................................................13
STATE REGULATION ........................................................................................................13
RECORDS AND REPORTS......................................................................................................13
FINANCIAL STATEMENTS.....................................................................................................13
APPENDIX................................................................................................................A-1
Annuity Transfer Formula.......................................................................................A-1

</TABLE>
39

<PAGE>

Appendix A

Example of Variable Accumulation Unit Value Calculations
Suppose the net asset value per share of a Portfolio at the end of the
current Valuation Period is $20.15; at the end of the immediately preceding
Valuation Period it was $20.10; the Valuation Period is one day; and no
dividends or distributions caused the Portfolio to go "ex-dividend" during the
current Valuation Period. $20.15 divided by $20.10 is 1.002488. Subtracting the
one day risk factor for Mortality and Expense Risk Charge and the Administrative
Expense Charge of .003814% (the daily equivalent of the current charge of 1.40%
on an annual basis) gives a Net Investment Factor of 1.002449. If the value of
the Variable Accumulation Unit for the immediately preceding Valuation Period
had been 15.500000, the value for the current Valuation Period would be
15.537966 (15.5 x 1.002449).
Example of Variable Annuity Unit Value Calculations

Suppose the circumstances of the first example exist, and the value of
a Variable Annuity Unit for the immediately preceding Valuation Period had been
13.500000. If the first Variable Annuity Payment is determined by using an
annuity payment based on an assumed interest rate of 4% per year, the value of
the Variable Annuity Unit for the current Valuation Period would be 13.531613
(13.5 x 1.002449 (the Net Investment Factor) x 0.999893). 0.999893 is the
factor, for a one day Valuation Period, that neutralizes the assumed rate of
four percent (4%) per year used to establish the Variable Annuity Rates found in
the Policy. Example of Variable Annuity Payment Calculations

Suppose that the Account is currently credited with 3,200.000000
Variable Accumulation Units of a particular Sub-Account.
Also suppose that the Variable Accumulation Unit Value and the Variable
Annuity Unit Value for the particular Sub-Account for the Valuation Period which
ends immediately preceding the first day of the month is 15.500000 and 13.500000
respectively, and that the Variable Annuity Rate for the age and option elected
is $5.73 per $1,000. Then the first Variable Annuity Payment would be:

3.200 x 15.5 x 5.73 divided by 1,000 = $284.21,
and the number of Variable Annuity Units credited for future payments
would be:
284.21 divided by 13.5 = 21.052444.

For the second monthly payment, suppose that the Variable Annuity Unit
Value on the 10th day of the second month is 13.565712. Then the second Variable
Annuity Payment would be $285.59 (21.052444 x 13.565712).

A-1

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