LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT, 485APOS, 1996-03-01

LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT
485APOS, 1996-03-01

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<PAGE>

As filed with the Securities and Exchange Commission on
March 1, 1996
'33 Act File No. 33-66786
'40 Act File No. 811-7924

____________________________________________________________________
____________________________________________________________________

SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1993 [ ]

Pre-Effective Amendment No. _______ [ ]

Post-Effective Amendment No. ___5___ [X]

REGISTRATION STATEMENT UNDER THE INVESTMENT ACT OF 1940 [ ]

Amendment No. ___7___ [X]

LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT

LINCOLN BENEFIT LIFE COMPANY
Depositor

206 South 13th Street
Lincoln, Nebraska 68508

_______

JOHN MORRIS
Lincoln Benefit Life Company
206 South 13th Street
Lincoln, Nebraska 68508

Approximate Date of Proposed Public Offering: As soon as practicable after
effective date.

It is proposed that this filing will become effective:

___ immediately upon filing pursuant to paragraph (b) of Rule 485
___ on (date) pursuant to paragraph (b) of Rule 485
___ 60 days after filing pursuant to paragraph (a) of Rule 485
_X_ on (May 1, 1996) pursuant to paragraph (a) of Rule 485

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, the Registrant
has registered an indefinite amount of securities under the Securities Act of
1933. A 24f-2 notice for the fiscal year ending December 31, 1995 was filed on
February 29, 1996.

<PAGE>

LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT

CROSS REFERENCE SHEET

<TABLE>
<CAPTION>
ITEM NUMBER IN FORM N-4 CAPTION
- ----------------------- -------
PART A - PROSPECTUS
-------------------
<S> <C>
1. Cover Page................................. Cover Page

2. Definitions................................ Definitions

3. Synopsis................................... Questions & Answers About the Contract

4. Condensed Financial Information............ Condensed Financial Information

5. General Description of Registrant,
Depositor & Portfolio Companies.......... Description of Lincoln Benefit Life
Company & the Separate Account;
Separate Account Investments

6. Deductions................................. Contract Charges

7. General Description of Variable............ Description of the Contracts; Annuity
Period; Purchases, Withdrawals &
Contract Value; Administration

8. Annuity Period............................. Annuity Period

9. Death Benefit.............................. Description of the Contracts; Annuity
Period

10. Purchases & Contract Value................. Purchases, Withdrawals & Contract Value

11. Redemptions................................ Questions & Answers About the Contract;
Purchases, Withdrawals & Contract Value

12. Taxes...................................... Taxes

13. Legal Proceedings.......................... Legal Proceedings

14. Table of Contents of the Statement
of Additional Information................ Additional Information about the
Separate Account
</TABLE>

i
<PAGE>

PART B - STATEMENT OF ADDITIONAL INFORMATION
--------------------------------------------

Certain information required in Part B of the Registration Statement has been
included within the Prospectus forming part of this Registration Statement; the
following cross-references suffixed with ("P") are made by reference to the
captions in the Prospectus:

<TABLE>
<CAPTION>
ITEM NUMBER IN FORM N-4 CAPTION
- ----------------------- -------
<S> <C> <C>
15. Cover Page................................. Cover Page

16. Table of Contents.......................... Table of Contents

17. General Information & History.............. Description of Lincoln Benefit Life
Company & the Separate Account(P);
Separate Account Investments(P)

18. Services................................... Contract Charges(P); Custodian(P);
Financial Statements

19. Purchase of Securities Being Offered....... Purchases, Withdrawals & Contract
Value(P); Contract Charges(P)

20. Underwriters............................... Distribution of Contracts

21. Calculation of Performance Data............ Separate Account Performance

22. Annuity Payments........................... The Contract

23. Financial Statements....................... Financial Statements
</TABLE>
PART C
------

Information required to be included in Part C is set forth under the appropriate
item, so numbered, in Part C of this Registration Statement.

ii
<PAGE>

FLEXIBLE PREMIUM
INDIVIDUAL
DEFERRED VARIABLE ANNUITY CONTRACTS
ISSUED BY
LINCOLN BENEFIT LIFE COMPANY
IN CONNECTION WITH
LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT
STREET ADDRESS: 206 SOUTH 13TH ST., LINCOLN, NE 68508
MAILING ADDRESS: P. O. BOX 82532, LINCOLN, NE 68501-2532
TELEPHONE NUMBER: 1-800-865-5237

This prospectus describes a Flexible Premium Individual Deferred Variable
Annuity Contract ("Contract") offered by Lincoln Benefit Life Company
("Company"). The Contract is a deferred annuity designed to aid you in long-term
financial planning. It is offered to you on either a tax qualified or non-tax
qualified basis.

The Company is a wholly owned subsidiary of Allstate Life Insurance Company.
Contract values will be allocated to the Lincoln Benefit Life Variable Annuity
Account ("Separate Account") and/or the Fixed Account, discussed further on
pages 9 and 11. The Separate Account has a series of subaccounts which currently
invest in shares of these mutual funds:

JANUS ASPEN SERIES: Flexible Income Portfolio; Balanced Portfolio; Growth
Portfolio; Aggressive Growth Portfolio; Worldwide Growth Portfolio

FIDELITY'S VARIABLE INSURANCE PRODUCTS FUND: Money Market Portfolio; Equity-
Income Portfolio; Growth Portfolio; Overseas Portfolio

FIDELITY'S VARIABLE INSURANCE PRODUCTS FUND II: Asset Manager Portfolio;
Contrafund

IAI RETIREMENT FUNDS, INC.: IAI Regional Portfolio; IAI Balanced Portfolio; IAI
Reserve Portfolio

FEDERATED INSURANCE MANAGEMENT SERIES: Federated Utility Fund II; Federated Fund
for U.S. Government Securities II; Federated High Income Bond Fund II

SCUDDER VARIABLE LIFE INVESTMENT FUND: Bond Portfolio; Balanced Portfolio

Other investment options may be made available in the future.

A Contract may not be issued to a prospective Contract Owner if either you or
the Annuitant has attained age 81 prior to the time the application is received
by the Company.

This prospectus sets forth the information you ought to know before investing.
You should read it and keep it for future reference.

A Statement of Additional Information, which has the same date as this
Prospectus, has been filed with the Securities and Exchange Commission and is
incorporated herein by reference. You can obtain a free copy of it from us by
writing us or calling us at the telephone number given above. The Table of
Contents of the Statement of Additional Information appears on page 23 of this
prospectus.

This prospectus is valid only when accompanied or preceded by current
prospectuses for the Janus Aspen Series; the Fidelity's Variable Insurance
Products Fund and Variable Insurance Products Fund II; the IAI Retirement Funds,
Inc.; the Federated Insurance Management Series; and the Scudder Variable Life
Investment Fund.

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 YOUR FUTURE REFERENCE.

THE DATE OF THIS PROSPECTUS IS MAY 1, 1996.

1
<PAGE>

TABLE OF CONTENTS

Definitions.................................................. 3
Questions and Answers About the Contract..................... 4
Fee Tables................................................... 6
Examples..................................................... 7
Explanation of Fee Tables and Examples....................... 8
Condensed Financial Information.............................. 8
Description of Lincoln Benefit Life Company and
the Investment Options..................................... 9
Lincoln Benefit Life Company............................ 9
Separate Account........................................ 9
Separate Account Investments................................. 9
The Portfolios.......................................... 9
Voting Rights........................................... 11
Substitution of Securities.............................. 11
The Fixed Account............................................ 11
Contract Charges............................................. 12
Mortality and Expense Risk Charge....................... 12
Administrative Charges.................................. 12
Contract Administration Charge..................... 12
Administrative Expense Charge...................... 12
Transfer Fee....................................... 12
Sales Charges........................................... 12
Withdrawal Charge.................................. 12
Free Withdrawal.................................... 13
Waiver of Withdrawal Charge for
Certain Qualified Plan
Withdrawals...................................... 14
Premium Taxes........................................... 14
Deduction for Separate Account
Income Taxes.......................................... 14
Other Expenses.......................................... 14
Description of the Contracts................................. 14
Summary................................................. 14
Contract Owner.......................................... 14
Annuitant............................................... 14
Modification of the Contract............................ 14
Assignment.............................................. 14
Death Benefit........................................... 15
Beneficiary............................................. 15
Voting Rights of Contract Owners........................ 15
Purchases, Withdrawals and Contract Value.................... 15
Minimum Purchase Payment................................ 15
Automatic Payment Plan.................................. 15
Automatic Dollar Cost Averaging
Program............................................... 15
Portfolio Rebalancing................................... 16
Contract Value.......................................... 16
Separate Account Accumulation
Unit Value............................................ 16
Allocation of Purchase Payments......................... 16
Large Case Credit....................................... 17
Transfer During
Accumulation Period................................... 17
Transfers Authorized by Telephone....................... 17
Contract Loans for 401(a), 401(k),
and 403(b) Contracts.................................. 18
Withdrawals (Redemptions)............................... 18
Systematic Withdrawal Program........................... 19
ERISA Plans............................................. 19
Minimum Contract Value.................................. 19
Annuity Period............................................... 19
Annuity Date............................................ 19
Deferment of Payments................................... 20
Annuity Options......................................... 20
Other Options........................................... 20
Death Benefit During Annuity Period..................... 20
Variable Annuity Payments............................... 20
Administration............................................... 21
Taxes........................................................ 21
General................................................. 21
Withholding Tax on Distributions........................ 22
Tax Treatment of Assignments............................ 22
Tax Treatment of Withdrawals............................ 22
Qualified Plans.................................... 22
Non-Qualified Plans................................ 22
Distribution of Contracts.................................... 23
Legal Proceedings............................................ 23
Legal Matters................................................ 23
Registration Statement....................................... 23
Financial Statements......................................... 23
Additional Information About
the Separate Account....................................... 23
Table of Contents of Statement of
Additional Information..................................... 23
Appendix--Portfolios and Performance Data.................... 23

- --------------------------------------------------------------------------------
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. THE COMPANY DOES NOT AUTHORIZE ANY
INFORMATION OR REPRESENTATIONS REGARDING THE OFFERING DESCRIBED IN THIS
PROSPECTUS OTHER THAN AS CONTAINED IN THIS PROSPECTUS.
- -------------------------------------------------------------------------------

2
<PAGE>

DEFINITIONS

The following terms, as used in this prospectus, have the indicated meanings:

ACCUMULATION PERIOD - The period between the Issue Date and the Annuity Date,
the build-up phase under the Contract.

ACCUMULATION UNIT - A unit of measurement which we use to calculate Contract
Value.

ANNUITANT - The natural person on whose life the annuity benefits under a
Contract are based.

ANNUITIZATION - The process by which you convert from the Accumulation Period to
the Annuity Period. Upon Annuitization, the Contract is converted from the
build-up phase to the phase during which you or other payee(s) receive periodic
annuity payments.

ANNUITY DATE - The date on which annuity payments are to begin.

ANNUITY PERIOD - The period starting on the Annuity Date, the payout phase under
the Contract.

ANNUITY UNIT - A unit of measurement which we use to calculate the amount of
Variable Annuity payments.

BENEFICIARY(IES) - The person(s) designated to receive any death benefits under
the Contract.

CODE - The Internal Revenue Code.

COMPANY ("WE," "US," "OUR," "LINCOLN BENEFIT LIFE") - Lincoln Benefit Life
Company.

CONTRACT ANNIVERSARY - The anniversary of the Issue Date in subsequent years.

CONTRACT OWNER ("YOU") - The person(s) having the privileges of ownership
defined in the Contract. Such privileges may be restricted by a retirement plan
pursuant to which the Contract is issued.

CONTRACT VALUE - The sum of the values of your interests in the Subaccounts of
the Separate Account and the Fixed Account.

CONTRACT YEAR - A twelve-month period beginning on the Issue Date or any
Contract Anniversary.

CONTRIBUTION YEAR - A twelve-month period beginning on the date a Purchase
Payment is applied to a Subaccount, or any anniversary of that date.

DUE PROOF OF DEATH - (1) A certified original copy of the Death Certificate; or
(2) a certified copy of a decree of a court of competent jurisdiction as to the
finding of death; or (3) a written statement by a medical doctor who attended
the deceased at the time of death; or (4) any other proof satisfactory to the
Company.

FIXED ACCOUNT - The portion of the Contract Value invested in our general
account.

FIXED ANNUITY - A series of payments made during the Annuity Period to a payee
under a Contract that are fixed in amount.

ISSUE DATE - The date when the Contract becomes effective if the annuitant is
then living and the initial Purchase Payment has been paid.

LATEST ANNUITY DATE - The tenth day of the month following the Annuitant's 90th
birthday. In the case of Contracts issued in connection with Qualified Plans,
the Code generally requires that a minimum distribution is taken by April 1 of
the calendar year following the calendar year in which you attain age 70 1/2.
Accordingly, if you are in a Qualified Plan, we may require you to annuitize by
such date unless you demonstrate that the minimum distribution is otherwise
being made.

LOAN ACCOUNT - An account established for amounts transferred from the
Subaccounts or the Fixed Account as security for outstanding Contract loans.

NET INVESTMENT FACTOR - The factor for a particular Subaccount used to determine
the value of an Accumulation Unit and Annuity Unit in any Valuation Period.

NON-QUALIFIED PLAN - A retirement plan which does not receive special tax
treatment under Sections 401, 403(b), 408 or 457 of the Internal Revenue Code.

PORTFOLIO(S) - The underlying mutual fund(s) (or investment series thereof) in
which the Subaccounts invest.

PURCHASE PAYMENTS - Amounts paid to us as premium for the Contract by you or on
your behalf.

QUALIFIED PLAN - A retirement plan which receives special tax treatment under
Sections 401, 403(b), 408 or a state and local government or other Tax Exempt
Organization Deferred Compensation Plan under Section 457 of the Internal
Revenue Code.

SEPARATE ACCOUNT - A segregated investment account of the Company entitled
Lincoln Benefit Life Variable Annuity Account.

SUBACCOUNT - A subdivision of the Separate Account invested wholly in shares of
one of the Portfolios.

SURRENDER VALUE -The amount paid upon surrender of the Contract, equal to the
Contract Value less any applicable premium tax charges, withdrawal charges and
the Contract Administration Charge.

VALUATION DATE - Each day the New York Stock Exchange is open for business.

VALUATION PERIOD - The period commencing at the close of normal trading on the
New York Stock Exchange ("NYSE") (currently 4:00 p.m. Eastern time) on each
Valuation Date and ending at the close of the NYSE on the next succeeding
Valuation Date.

VARIABLE ANNUITY - A series of payments made during the Annuity Period to a
payee under a Contract which vary in amount in accordance with the investment
experience of the Subaccounts to which Contract Values have been allocated.

WITHDRAWAL CHARGE - The contingent deferred sales charge assessed against
certain withdrawals.

3
<PAGE>

QUESTIONS & ANSWERS
ABOUT THE CONTRACT

The following is a compilation of answers to selected questions that you might
have about some of the most important features of the Contract. The remainder
of the prospectus, which follows immediately afterwards, contains a more
complete discussion of these and other matters.

1. WHAT IS THE PURPOSE OF THE CONTRACT?

This Contract is designed for tax deferred retirement investing. Contract
Values accumulate based on the experience of the underlying funds and the Fixed
Account. You may receive annuity payments on a fixed or variable basis. The
Contract is available for non-qualified or qualified plans. You can allocate
Purchase Payments to the Fixed Account or to any of the Subaccounts of the
Separate Account, each of which will invest in a mutual fund or separate
investment Portfolio thereof. You bear the entire investment risk during the
Accumulation Period on amounts allocated to the Separate Account. You will also
bear the entire investment risk during the Annuity Period if you choose to
receive annuity payments on a variable basis.

2. IN WHICH MUTUAL FUNDS DOES THE SEPARATE ACCOUNT INVEST?

The Separate Account currently invests exclusively in shares of these mutual
funds:

Fund Portfolio(s)
---- ------------
<S> <C>
Janus Aspen Series Flexible Income Portfolio
Balanced Portfolio
Growth Portfolio
Aggressive Growth Portfolio
Worldwide Growth Portfolio
- ------------------------------------------------------------
Fidelity's Variable Money Market Portfolio
Insurance Equity-Income Portfolio
Products Fund Growth Portfolio
Overseas Portfolio
- ------------------------------------------------------------
Fidelity's Variable Asset Manager Portfolio
Insurance Contrafund Portfolio
Products Fund II
- ------------------------------------------------------------
IAI Retirement IAI Regional Portfolio
Funds, Inc. IAI Balanced Portfolio
IAI Reserve Portfolio
- ------------------------------------------------------------
Federated Insurance Federated Utility Fund II
Management Series Federated U.S. Government Securities II
Federated High Income Bond Fund II
- ------------------------------------------------------------
Scudder Variable Life Bond Portfolio Class A
Investment Fund Balanced Portfolio Class A
- ------------------------------------------------------------
</TABLE>

The assets of each Portfolio are held separately from the other Portfolios and
each has distinct investment objectives and policies which are described in the
accompanying prospectuses for the funds.

3. HOW DO I BUY A CONTRACT?

You must pay at least $1,200 during the first Contract Year. Subsequent
Purchase Payments must be $100 ($25 under an automatic payment plan (see page
15)). We may lower these minimums at our sole discretion. A Contract may not be
issued if either you or the Annuitant has attained age 81 before we receive your
application.

4. HOW IS MY PURCHASE PAYMENT ALLOCATED?

You allocate your Purchase Payment among the Subaccounts and the Fixed Account
in states where it is available when you apply for the Contract. Percentages
must be in whole numbers and the total allocation must equal 100%. When you
make subsequent Purchase Payments, you should again specify how you want your
payments allocated. If you do not, we will automatically allocate the payment
based on the then current Purchase Payment allocation (see page 16).

5. CAN I TRANSFER MY CONTRACT VALUES AMONG SUBACCOUNTS AND THE FIXED ACCOUNT?

Yes, during the Accumulation Period. You may transfer Contract Values by
written request or telephone authorization. No such transfers are permitted
after the Annuity Date. There are additional transfer restrictions for the
Fixed Account. (See page 17).

You may also want to take advantage of our automatic dollar cost averaging
program. Under this program, your values are automatically transferred from the
Fixed Account or a Subaccount of your choosing to up to eight options, including
other Subaccounts or the Fixed Account, at regular intervals. Transfers may be
made monthly, quarterly, or annually. (See "Automatic Dollar Cost Averaging
Program" page 15.)

6. HOW CAN I WITHDRAW MY FUNDS?

All or part of the Contract Value may be withdrawn before the Annuity Date, the
owner's death, or if the owner is not a natural person, the Annuitant's death.
Each year, free of charge, you may withdraw the greater of 10% of new Purchase
Payments (Purchase Payments made less than seven years before the withdrawal
date) or earnings not previously withdrawn. You may also withdraw free of
charge any old Purchase Payments (Purchase Payments made more than seven years
before the withdrawal date) not previously withdrawn. The withdrawal charge may
be waived under the terms of our confinement waiver benefit. (This benefit is
not available in all states.) (See "Free Withdrawal" page 13.)

Other withdrawals may be subject to a withdrawal charge, which is a contingent
deferred sales charge. The withdrawal charge will vary depending on the year
the Purchase Payment(s) and withdrawals are made. (See "Withdrawal Charge" page
12.) Additional restrictions may apply to Contracts issued in connection with
Qualified Plans (see "Taxes" page 21).

4
<PAGE>

7. WHAT ARE MY CONTRACT CHARGES AND DEDUCTIONS?

Charges against the Separate Account consist of an annual mortality and expense
risk charge of 1.25% of net asset value and an annual administrative expense
charge of 0.15% of net asset value. These charges are assessed on a daily
basis during both the Accumulation Period and Annuity Period. An annual
contract administration charge of $25 is assessed during the Accumulation Period
only. We cannot increase the amount of these charges. A transfer fee of $25
may be assessed after the first transfer in each calendar month. We currently
are waiving this fee. Any applicable premium taxes are deducted from the
Contract Value upon surrender, death, or annuitization. Premium taxes generally
range from 0% to 3.5%. Finally, the withdrawal charge, a contingent deferred
sales load, is referenced above. (See "Contract Charges" page 12.)

8. WHAT IS THE DEATH BENEFIT?

The death benefit is payable while the Contract is in force and before the
Annuity Date if the Contract Owner dies, or the Annuitant dies and the Contract
Owner is not a natural person. We must receive Due Proof of Death.

The death benefit is the greater of 1) all Purchase Payments less prior
withdrawals accumulated at 4% per year prior to the Contract Anniversary next
following your 75th birthday and at 0% per year thereafter (the "floor value"
calculation) or 2) the Contract Value less any premium tax. If the Contract
Value exceeds the floor value on the seventh Contract Anniversary, the floor
value will be raised to the level of the Contract Value. In such event, floor
values for years 8 and beyond will be calculated using the "stepped up" value on
the seventh anniversary.

9. CAN I RETURN THIS CONTRACT AFTER IT HAS BEEN DELIVERED?

You may return the Contract to us within 10 days (or longer period if required
by state law) after you receive it by delivering or mailing it to us. If the
Contract is returned, it will be terminated and, unless otherwise required by
state law, we will pay an amount equal to the Contract Value on the date we
receive the Contract. The Contract Value may be more or less than the Purchase
Payments made. Since state laws differ as to the consequences of returning a
Contract, you should refer to your Contract for information about your
circumstances.

5
<PAGE>

FEE TABLES

CONTRACT OWNER TRANSACTION EXPENSES

Contingent Deferred Sales Charge-Withdrawal Charge (as a percentage of Purchase
Payments)
<TABLE>
<CAPTION>

Contribution Applicable Contribution Applicable
Year Charge Year Charge
- -------------- ----------- ------------ -----------
<S> <C> <C> <C>
1-2 7% 6 3%
3 6% 7 2%
4 5% 8+ 0%
5 4%
</TABLE>

Annual Contract Administration
Charge..................................................... $25.00

Transfer Fee (Applies solely to the second and subsequent transfers within
a calendar month. We are currently waiving the transfer
fee)....................................................... $25.00

SEPARATE ACCOUNT EXPENSES (AS A PERCENTAGE OF DAILY NET ASSET VALUE DEDUCTED
FROM EACH OF
THE SUBACCOUNTS OF THE SEPARATE ACCOUNT)
<TABLE>
<CAPTION>

<S> <C>
Mortality Risk Charge 0.85%
Expense Risk Charge 0.40%
Administrative Expense Charge 0.15%
----
</TABLE>
Total Separate Account Annual Expenses 1.40%

PORTFOLIO COMPANY ANNUAL EXPENSES (AS A PERCENTAGE OF PORTFOLIO AVERAGE NET
ASSETS)

JANUS ASPEN Flexible Aggressive Worldwide
SERIES: Income Balanced* Growth* Growth* Growth*
------------ ------------- ----------- ---------- --------
<S> <C> <C> <C> <C> <C>
Management: 0.65% 0.82% 0.75% 0.65% 0.68%
Other: 0.42% 0.55% 0.11% 0.13% 0.22%
----- ----- ---- --------- -------
Total: 1.07% 1.37% 0.86% 0.78% 0.90%

FIDELITY'S VARIABLE Money Equity
INSURANCE PRODUCTS FUND Market Income Growth Overseas
----------- ------------ ---------- ---------
Management: 0.24% 0.51% 0.61% 0.76%
Other: 0.09% 0.10% 0.09% 0.15%
----- ----- ---- ---------
Total: 0.33% 0.61% 0.70% 0.91%

FIDELITY'S VARIABLE Asset
INSURANCE PRODUCTS FUND II Manager** Contrafund**
----------- ------------
Management: 0.71% 0.61%
Other: 0.08% 0.11%
----- -----
Total: 0.79% 0.72%

IAI RETIREMENT FUNDS, IAI IAI IAI
INC.: Regional*** Balanced*** Reserve***
----------- ------------ ----------
Management: 0.65% 0.65% 0.45%
Other: 0.60% 0.60% 0.40%
----- ----- ----
Total: 1.25% 1.25% 0.85%

FEDERATED INSURANCE U.S. Gov't High Income
MANAGEMENT SERIES: Utility+ Securities+ Bond
----------- ------------ ----------
Management: 0.00% 0.00% 0.00%
Other: 0.85% 0.80% 0.80%
----- ----- ----
Total: 0.85% 0.80% 0.80%

SCUDDER VARIABLE
LIFE INVESTMENT FUND Bond Balanced
----------- ------------
Management: 0.475% 0.475%
Other: 0.105% 0.275%
----- -----
Total: 0.58% 0.75%

</TABLE>

* The expense figures shown are net of certain expense waivers from Janus
Capital Corporation. Without such waivers, Management Fees, Other Expenses, and
Total Portfolio Annual Expnses for the Portfolios for the fiscal year ended
December 31, 1995, were: 1.00%, 0.55% and 1.55%, respectively, for Balanced
Portfolio; 0.82%, 0.11% and 0.93%, respectively, for Aggressive Growth
Portfolio; 0.85%, 0.13% and 0.98%, respectively, for Growth Portfolio; 0.87%,
0.22% and 1.09%, respectively, for Worldwide Growth Portfolio.

** A portion of the brokerage commissions the fund paid was used to reduce its
expenses. Without this reduction total operating expenses would have been (for
Asset Manager - 0.81% and for Contrafund -0.73%).

*** The expense figures shown are net of expense reimbursements from Investment
Advisers, Inc. Wihtout such reimbursements, Management Fees and Total Portfolio
Expenses for the Portfolios are estimated as follows: 0.65% and 1.64% for
Regional Portfolio, 0.65% and 5.29% for Balanced Portfolio, and 0.45% and 2.62%
for Reserve Portfolio.

+ The expense figures shown reflect the voluntary waiver of all or a portion of
the Management Fee. The maximum Management Fees for the indicated Portfolios and
the Total Portfolio Expenses absent the volunary waiver are as follows: 0.75%
and 1.60%, respectively, for the Utility Fund II; 0.60% and 1.40%, respectively,
for the U.S. Government Securities II; and 0.60% and 1.40%, respectively, for
the High Income Bond Fund.

6
<PAGE>

EXAMPLES

IF YOU SURRENDER YOUR CONTRACT AT THE END OF THE PERIOD YOU WOULD PAY THE
FOLLOWING EXPENSES ON A $1,000 INVESTMENT IN EACH INDICATED SUBACCOUNT ASSUMING
5% ANNUAL RETURN ON ASSETS:

Janus Janus Janus Fidelity Fidelity
Flexible Janus Janus Aggressive Worldwide Money Equity- Fidelity Fidelity Fidelity
Income Balanced Growth Growth Growth Market Income Growth Overseas Contrafund

-------- -------- ------- --------- ----------- --------- ------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 year $ 91 $ 94 $ 88 $ 89 $ 89 $ 84 $ 86 $ 87 $ 89 $ 88

3 years 139 147 130 133 134 117 126 128 134 129

5 years 177 191 162 166 168 139 153 158 169 159

10 years 291 320 261 270 274 214 244 253 275 255

Federated
Fidelity Federated High
Asset IAI IAI IAI Federated U.S. Income Scudder Scudder
Manager Regional Balanced Reserve Utility Securities Bond Bond Balanced
-------- -------- -------- ------- --------- ----------- --------- ------- --------
1 year $ 88 $ 92 $ 92 $ 89 $ 89 $ 88 $ 88 $ 86 $ 88
3 years 131 144 144 132 132 131 131 125 130
5 years 162 186 186 165 165 163 163 152 160
10 years 262 308 308 268 268 263 263 241 255
</TABLE>

IF YOU ANNUITIZE* AT THE END OF THE PERIOD YOU WOULD PAY THE FOLLOWING EXPENSES
ON A $1,000 INVESTMENT IN EACH INDICATED SUBACCOUNT ASSUMING 5% ANNUAL RETURN ON
ASSETS:

Janus Janus Janus Fidelity Fidelity
Flexible Janus Janus Aggressive Worldwide Money Equity- Fidelity Fidelity Fidelity
Income Balanced Growth Growth Growth Market Income Growth Overseas Contrafund
--------- -------- ------- --------- ----------- -------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 year $ 26 $ 29 $ 23 $ 24 $ 24 $ 19 $ 21 $ 22 $ 24 $ 23

3 years 80 89 71 74 75 57 66 69 75 69

5 years 137 151 122 126 128 99 113 118 129 119

10 years 291 320 261 270 274 214 244 253 275 255

Fidelity Federated Federated High
Asset IAI IAI IAI Federated U.S. Income Scudder Scudder
Manager Regional Balanced Reserve Utility Securities Bond Bond Balanced
-------- --------- -------- ------- --------- ----------- -------- ------- --------
1 year $ 23 $ 28 $ 28 $ 24 $ 24 $ 23 $ 23 $ 21 $ 23
3 years 72 85 85 73 73 72 72 65 70
5 years 122 146 146 125 125 123 123 112 120
10 years 262 308 308 268 268 263 263 241 258
</TABLE>

IF YOU DO NOT SURRENDER YOUR CONTRACT YOU WOULD PAY THE FOLLOWING EXPENSES ON A
$1,000 INVESTMENT IN EACH INDICATED SUBACCOUNT ASSUMING 5% ANNUAL RETURN ON
ASSETS:

3 years 80 89 71 74 75 57 66 69 75 69

5 years 137 151 122 126 128 99 113 118 129 119

10 years 291 320 261 270 274 214 244 253 275 255

*The withdrawal charge will be waived if a settlement option is selected which
provides for payments over at least 5 years or over the annuitant's lifetime.

7
<PAGE>

EXPLANATION OF FEE TABLES AND EXAMPLES

1. The purpose of the foregoing table and examples is to assist you in
understanding the various costs and expenses that you will bear directly or
indirectly by investing in the Separate Account. The table reflects expenses of
the Separate Account as well as the Portfolios. For additional information see
"Contract Charges," beginning on Page 11 of this prospectus; see also the
sections relating to management of the Portfolios in their respective
prospectuses. The examples do not illustrate the tax consequences of
surrendering a Contract.

2. The examples assume that there were no transactions which would result in the
imposition of the transfer fee. We are currently waiving this fee, but reserve
the right to charge $25 to the second and each subsequent transfer within a
calendar month. Premium taxes are not reflected. Presently, premium taxes
(which range from 0% to 3.5%) are deducted from Contract Value upon full
surrender, death or annuitization.

3. For purposes of the amounts reported in the Examples, the Contract
Administration Charge is reflected by applying a percentage equivalent charge,
obtained by dividing the total amount of such charges anticipated to be
collected during the year by the total estimated average net assets of the
Subaccounts and the Fixed Account attributable to the Contracts.

4. The Examples reflect any Free Withdrawal Amounts.

5. NEITHER THE FEE TABLES NOR THE EXAMPLES ARE REPRESENTATIONS OF PAST OR FUTURE
EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.

CONDENSED FINANCIAL INFORMATION

The following tables present condensed financial information with respect to
each Subaccount of the Separate Account. The information in the tables is
included in the Separate Account's financial statements that have been audited
by Deloitte & Touche LLP, independent public accountants. The table should be
read in conjunction with the Separate Account's financial statements, which are
in the Separate Account's Annual Report dated as of December 31, 1995, contained
in the Statement of Additional Information.

Selected Accumulation Unit Value/1/ information throughout each period indicated
is as follows:

<TABLE>
<CAPTION>
Accumulation Unit Value/1/ Number of Units Accumulation Unit Value/1/ Number of Units
Year Ended 1994 Outstanding at Year Ended 1995 Outstanding at
Beginning End End of 1994 Beginning End End of 1995
--------- --- ----------- --------- --- -----------
$ $
<S> <C> <C> <C> <C> <C> <C>
Fidelity
Money Market 10.00 10.27 249,473 10.27 10.72 1,063,044
Growth 10.00 9.73 247,556 9.73 12.98 1,028,768
Equity-Income 10.00 10.28 145,290 10.28 13.70 1,025,219
Overseas 10.00 9.70 166,871 9.70 10.49 599,989
Asset Manager 10.00 9.09 226,936 9.09 10.49 593,918

Scudder
Bond 10.00 9.27 4,615 9.27 10.81 134,527
Balanced 10.00 9.48 55,482 9.48 11.85 209,087

Janus
Flexible Income 10.00 9.64 9,271 9.64 11.77 145,173
Balanced 10.00 9.68 54,218 9.68 11.91 204,556
Growth 10.00 9.85 91,020 9.85 12.64 529,026
Aggressive Growth 10.00 11.60 78,193 11.60 14.58 545,594
Worldwide Growth 10.00 9.67 109,298 9.67 12.15 520,639

Federated
High Income Bond II 10.00 9.50 28,352 9.50 11.28 210,460
Utility Fund II 10.00 9.50 44,207 9.50 11.64 197,013
U.S. Gov't Securities II 10.00 10.10 36,563 10.10 10.83 106,437

Investment Advisers, Inc. (IAI)
Regional 10.00 10.48 71,368 10.48 13.80 325,443
Reserve 10.00 10.09 51,928 10.09 10.46 67,843
Balanced 10.00 10.09 18,173 10.09 11.56 60,190
</TABLE>

/1/Accumulation Unit Value: unit of measure used to calculate the value of a
Contract Owner's interest in a Subaccount for any Valuation Period. An
Accumulation Unit Value does not reflect deduction of certain charges under the
Contract that are deducted from your Contract Value, such as the Contract
Administration Charge, and Administrative Expense Charge.

A brief explanation of how performance of the Subaccounts is calculated may be
found in the Statement of Additional Information.

8
<PAGE>

LINCOLN BENEFIT LIFE COMPANY AND THE INVESTMENT OPTIONS

LINCOLN BENEFIT LIFE COMPANY

Lincoln Benefit Life Company is a stock life insurance company organized under
the laws of the state of Nebraska in 1938. Its legal domicile and principal
business address is 206 South 13th Street, Lincoln, Nebraska. Lincoln Benefit
Life is a wholly-owned subsidiary of Allstate Life Insurance Company, a stock
life insurance company incorporated under the laws of the State of Illinois.
Allstate Life Insurance Company is a wholly-owned subsidiary of Allstate
Insurance Company ("Allstate"), a stock property-liability insurance company
incorporated under the laws of Illinois. All outstanding Capital stock of
Allstate is owned by the Allstate Corporation ("Corporation").

We are admitted to conduct life insurance and annuity business in the District
of Columbia, Guam and in all states except New York. The Contract will be
marketed in all of the jurisdictions in which we are admitted to conduct
variable annuity business. The Contracts offered by this prospectus are issued
by us and will be funded in the Separate Account and/or the Fixed Account.

Lincoln Benefit Life Company is highly rated by independent agencies, including
A.M. Best, Moody's, and Standard & Poor's. These ratings are based on the
Company's reinsurance agreement with Allstate Life Insurance Company, as
explained below, and reflect financial soundness and strong operating
performance. The ratings are not intended to reflect the financial strength or
investment experience of the Separate Account. We may from time to time
advertise these ratings in our sales literature.

We receive our ratings through Allstate Life, which reinsures all net new
business from the Lincoln Benefit Life fixed account. Through the reinsurance
agreement, all of the assets backing Lincoln Benefit Life's reinsured
liabilities are owned by Allstate Life Insurance Company. These assets
represent our fixed account and are invested and managed by Allstate Life
Insurance Company. While the reinsurance agreement provides Lincoln Benefit
Life with financial backing from Allstate Life, it does not create any direct
contractual relationship with individual Lincoln Benefit Life policyholders.

SEPARATE ACCOUNT

Lincoln Benefit Life Variable Annuity Account was originally established by
Lincoln Benefit on August 3, 1992, pursuant to the provisions of Nebraska law,
as a segregated asset account of the Company. The Separate Account meets the
definition of a "separate account" under the federal securities laws and is
registered with the Securities and Exchange Commission as a unit investment
trust under the Investment Company Act of 1940. This registration does not
involve supervision of the management of the Separate Account or the Company by
the Securities and Exchange Commission.

The assets of the Separate Account are our property. However, the assets of the
Separate Account, equal to its reserves and other contract liabilities, are not
chargeable with liabilities arising out of any other business we may conduct.
Our obligations arising under the Contracts are general corporate obligations of
Lincoln Benefit Life.

Income, gains, and losses, whether or not realized, from assets allocated to the
Separate Account are credited to or charged against the Separate Account without
regard to our other income, gains, or losses.

The Separate Account is divided into Subaccounts, with the assets of each
Subaccount invested in the shares of one of the Portfolios. We do not guarantee
the investment performance of the Separate Account, its Subaccounts or the
Portfolios. Values allocated to the Separate Account and the amount of Variable
Annuity payments will vary with the values of shares of the Portfolios, and are
also reduced by Contract charges. The Separate Account may also fund other
annuity contracts issued by Lincoln Benefit Life, which will be accounted for
separately.

SEPARATE ACCOUNT INVESTMENTS

THE PORTFOLIOS

Each of the Subaccounts of the Separate Account invests in the shares of one of
the Portfolios, which are open-end management investment companies ("Funds")
registered under the Investment Company Act of 1940 (commonly known as "mutual
funds"), or separate investment series of such Funds. Following is a summary
description of the Portfolios in which the Subaccounts invest. More detailed
information concerning the Portfolios appears in the respective accompanying
prospectuses for the Funds. The Appendix on page 23 contains a description of
how advertised performance data for the Subaccounts are computed.

JANUS ASPEN SERIES (investment adviser: Janus Capital Corporation)
- ------------------

FLEXIBLE INCOME PORTFOLIO seeks to maximize total return from a combination of
current income and capital appreciation, with an emphasis on the income
component of total return. Flexible Income Portfolio invests in all types of
income-producing securities. This Portfolio may have substantial holdings of
debt securities rated below investment grade. Investments in such securities
present special risks; you are urged to carefully read the risk disclosure in
the accompanying prospectus relating to the Portfolio before allocating amounts
to the Janus Flexible Income Subaccount.

BALANCED PORTFOLIO seeks both growth of capital and current income. Balanced
Portfolio normally invests 40-60% of its assets in securities selected primarily
for their growth potential and 40-60% of its assets in securities selected
primarily for their income potential.

GROWTH PORTFOLIO seeks long-term growth of capital by investing primarily in a
diversified portfolio of common

9
<PAGE>

stocks of a large number of issuers of any size. Generally, this Portfolio
emphasizes issuers with larger market capitalizations.

AGGRESSIVE GROWTH PORTFOLIO seeks long-term growth of capital in a manner
consistent with the preservation of capital. The Portfolio is a non-diversified
fund that pursues its objective by normally investing at least 50% of its equity
assets in securities issued by medium-sized companies, those whose market
capitalizations fall within the range of companies in the S&P MidCap 400 Index
(the "MidCap Index"). Companies whose capitalization falls outside this range
after the Portfolio's initial purchase continue to be considered medium-sized
companies for the purpose of this policy. The range of the MidCap Index is
expected to change on a regular basis. Subject to the above policy, the
Portfolio may also invest in smaller or larger issuers.

WORLDWIDE GROWTH PORTFOLIO seeks long-term growth of capital by investing in a
diversified portfolio of common stocks of foreign and domestic issuers of any
size. Worldwide Growth Portfolio normally invests in issuers from at least five
different countries including the United States.

FIDELITY'S VARIABLE INSURANCE PRODUCTS FUND (investment adviser: Fidelity
Management & Research Company)

MONEY MARKET PORTFOLIO seeks to obtain as high a level of current income as is
consistent with preserving capital and providing liquidity. The Portfolio will
limit its investments to securities with remaining maturities of 397 days or
less.

EQUITY-INCOME PORTFOLIO seeks reasonable income by investing primarily in
income-producing equity securities. The goal is to achieve a yield in excess of
the composite yield of the S&P 500 Composite Stock Price Index. At least 65%
of the Portfolio's assets will be invested in income producing common or
preferred stock. The remainder will normally be invested in convertible and
non-convertible debt obligations.

GROWTH PORTFOLIO seeks to achieve capital appreciation. The Portfolio normally
purchases common stocks, although its investments are not restricted to any one
type of security.

OVERSEAS PORTFOLIO seeks long-term growth of capital primarily through
investments in foreign securities. At least 65% of the Portfolio's assets will
be invested in securities of issuers outside of North America. Most issuers
will be located in developed countries in the Americas, the Far East and Pacific
Basin, Scandinavia and Western Europe.

FIDELITY'S VARIABLE INSURANCE PRODUCTS FUND II (investment adviser: Fidelity
Management & Research Company)

ASSET MANAGER PORTFOLIO seeks to obtain high total return with reduced risk over
the long term by allocating its assets among domestic and foreign stocks, bonds,
and short-term fixed-income securities. Normally, the Portfolio's assets will
be allocated within the following investment parameters: 0-70% in short-term
instruments; 20-60% in bonds (intermediate to long-term debt); and 10-60% in
stocks (equities).

CONTRAFUND seeks capital appreciation by investing mainly in equity securities
of companies that Fidelity Management and Research Company believes to be
undervalued due to an overly pessimistic appraisal by the public. The fund
usually invests primarily in common stock and securities convertible into common
stock, but it has the flexibility to invest in any type of security that may
produce capital appreciation.

IAI RETIREMENT FUNDS, INC. (investment adviser: Investment Advisers, Inc.)

IAI REGIONAL PORTFOLIO pursues its objective of capital appreciation by
investing at least 80% of its equity investments in companies which have their
headquarters in Minnesota, Wisconsin, Iowa, Illinois, Nebraska, Montana, North
Dakota or South Dakota.

IAI BALANCED PORTFOLIO'S investment objective is to maximize total return to
investors. Balanced Portfolio pursues its objective by investing in a broadly
diversified portfolio of stocks, bonds and short-term instruments. The
Portfolio's assets will be allocated among these three classes of assets. Under
normal market conditions, the Portfolio will hold between 25% and 75% of its
assets in stocks and other equity securities, between 25% and 75% of its assets
in bonds and other fixed income securities, and up to 50% of its assets in short
term instruments.

IAI RESERVE PORTFOLIO'S investment objectives are to provide its shareholders
with high levels of capital stability and liquidity and, to the extent
consistent with these primary objectives, a high level of current income.
Reserve Portfolio pursues its investment objectives by investing primarily in a
diversified portfolio of investment grade bonds and other debt securities of
similar quality. Reserve Portfolio's dollar weighted average maturity will not
exceed twenty-five (25) months.

FEDERATED INSURANCE MANAGEMENT SERIES (investment adviser: Federated Advisers)

FEDERATED UTILITY FUND II'S investment objective is to achieve high current
income and moderate capital appreciation. The Fund endeavors to achieve its
objective by investing primarily in equity and debt securities of utility
companies that produce, transmit, or distribute gas and electric energy, as well
as those companies that provide communications facilities, such as telephone and
telegraph companies.

FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II'S investment objective is to
provide current income. The Fund invests in securities which are primarily or
direct obligations of the U.S. Government or its agencies or instrumentalities,
or which are guaranteed by the U.S. Government, its agencies, or
instrumentalities. The Fund may also invest in certain collateralized mortgage
obligations ("CMOs") and repurchase agreements.

10
<PAGE>

FEDERATED HIGH INCOME BOND FUND II'S investment objective is to seek high
current income. The Fund endeavors to achieve its objective by investing at
least 65% of its assets in lower rated corporate debt obligations, such as
preferred stocks, bonds, debentures, notes, equipment lease certificates and
equipment trust certificates. Some of these fixed income securities may involve
equity features. Under normal circumstances, the Fund will not invest more than
10% of the value of its total assets in equity securities.

SCUDDER VARIABLE LIFE INVESTMENT FUND (investment adviser: Scudder, Stevens &
Clark, Inc.) The Scudder Variable Life Investment Fund has two classes of
shares. The Subaccounts invest in those shares that do not impose distribution
fees.

BOND PORTFOLIO seeks high income from a high quality portfolio of debt
securities. Under normal circumstances, Bond Portfolio invests at least 65% of
its assets in bonds including those of the U.S. Government and its agencies and
those of corporations and other notes and bonds paying high current income. The
Portfolio is actively managed and can invest in a broad range of short,
intermediate and long term securities.

BALANCED PORTFOLIO seeks a balance of growth and income from a diversified
portfolio of equity and fixed income securities. The Portfolio also seeks long-
term preservation of capital through a quality oriented investment approach that
is designed to reduce risk. The assets of this Portfolio will be invested in
the following three market sectors: 1) common stock, preferred stock and other
equity securities; 2) bonds and other debt securities with maturities generally
exceeding one year; and 3) money market instruments and other debt securities
with maturities generally not exceeding thirteen months. Not more than 75% of
Balanced Portfolio's net assets may be invested in stocks or other equity
investments. Generally, 25% - 50% are invested in bonds. For defensive
purposes the Portfolio may invest up to 100% in cash or money market
instruments.

There is no assurance that the investment objective of any of the Portfolios
will be met. Detailed information about the Portfolios is contained in the
accompanying current prospectuses of the Funds. You should carefully review
those prospectuses before allocating amounts to be invested in the Subaccounts
of the Separate Account.

VOTING RIGHTS

To the extent required by applicable law, we will vote the shares of the
Portfolios held in the Separate Account at meetings of the shareholders of the
Funds in accordance with instructions received from persons having the voting
interest in the corresponding Subaccounts. We will vote shares for which we
have not received instructions in the same proportion as we vote shares for
which we have received instructions.

The number of shares which a person has a right to vote will be determined as of
a date to be chosen by the relevant Fund prior to the meeting of the respective
Fund's shareholders. Voting instructions will be solicited by written
communication in advance of such meeting. Except as may be limited by the terms
of the retirement plan pursuant to which the Contract was issued, the person
having such voting rights before the Annuity Date will be you; thereafter the
payee entitled to receive payments under the Contract.

SUBSTITUTION OF SECURITIES

If the shares of any of the Portfolios should no longer be available for
investment by the Separate Account or if, in the judgment of our Board of
Directors, further investment in the shares of a Portfolio is no longer
appropriate in view of the purposes of the Contract, we may substitute shares of
another mutual fund (or series thereof) for Portfolio shares already purchased
and/or to be purchased in the future by Purchase Payments under the Contract.
No such substitution of securities may take place without prior approval of the
Securities and Exchange Commission and under such conditions as the Commission
may impose.

THE FIXED ACCOUNT

The portion of the Contract relating to the Fixed Account is not registered
under the Securities Act of 1933 ("1933 Act") and the Fixed Account is not
registered as an Investment Company under the Investment Company Act of 1940
("1940 Act"). Accordingly, neither the Fixed Account nor any interests therein
are subject to the provisions or restrictions of the 1933 Act or the 1940 Act,
and the disclosure regarding the Fixed Account has not been reviewed by the
staff of the Securities and Exchange Commission. The following disclosure about
the Fixed Account may be subject to certain generally applicable provisions of
the federal securities laws regarding the accuracy and completeness of
disclosure.

You may allocate part or all of your Purchase Payments to the Fixed Account in
states where it is available, and any such amounts become part of the general
assets of Lincoln Benefit. Pursuant to the reinsurance agreement discussed on
page 9, Allstate Life invests the assets of the general account in accordance
with applicable laws governing the investments of insurance company general
accounts.

We guarantee that the interest rate credited to the Fixed Account will be at
least an annual effective rate of 3%. We may credit interest above the minimum
rate at 3%, but we are not obligated to do so. Any interest credited to the
Fixed Account in excess of the minimum guaranteed rate will be determined by us
at our sole discretion. You assume the risk that interest credited to the Fixed
Account may not exceed the minimum guaranteed rate of 3%.

Transfers from the Fixed Account are subject to certain limitations (see
Transfers, page 17). Also, we reserve the right to limit payment of partial
withdrawals or Surrender Value from the Fixed Account for up to 6 months (see
page 20).

11
<PAGE>

CONTRACT CHARGES

As is more fully described below, charges under the Contract offered by this
prospectus are assessed in three ways: (1) as deductions for Contract
administrative charges and, if applicable, for premium taxes; (2) as charges
against the assets of the Separate Account for administrative expenses or for
the assumption of mortality and expense risks; and (3) as Withdrawal Charges
(contingent deferred sales charges). In addition, certain deductions are made
from the assets of the Portfolios for investment management fees and expenses;
those fees and expenses, which are summarized in the Fee Tables on page 6, are
described more fully in the Prospectuses and Statements of Additional
Information for the Funds.

MORTALITY AND EXPENSE RISK CHARGE

We deduct a Mortality and Expense Risk Charge from each Subaccount during each
Valuation Period. The aggregate Mortality and Expense Risk Charge is equal, on
an annual basis, to 1.25% of the net asset value of each Subaccount
(approximately 0.85% is for mortality risks and approximately 0.40% is for
expense risks). The mortality risks which we assume arise from our contractual
obligations: (1) to make annuity payments after the Annuity Date for the life
of the Annuitant(s); (2) to waive the Withdrawal Charge in the event of your
death; and (3) to provide the Death Benefit prior to the Annuity Date. A
detailed explanation of the Death Benefit may be found under "Description of the
Contracts - Death Benefit," on page 14.

The expense risk which we assume is that the costs of administering the
Contracts and the Separate Account will exceed the amount received from the
Contract Administration Charge and the Administrative Expense Charge. (See
"Administrative Charges" below.) We guarantee the Expense Risk Charge and it
cannot be increased. The Mortality and Expense Risk Charge is assessed during
both the Accumulation Period and the Annuity Period.

ADMINISTRATIVE CHARGES

CONTRACT ADMINISTRATION CHARGE

An annual Contract Administration Charge of $25 is charged against each
Contract. The amount of this charge is guaranteed and will not increase. This
charge reimburses us for expenses incurred in maintaining your Contract. The
Contract Administration Charge will be assessed on each Contract Anniversary
that occurs on or prior to the Annuity Date. In the event that a total surrender
of Contract Value is made, the Charge will be assessed as of the date of
surrender without proration. This Charge is not assessed during the Annuity
Period.

The total Contract Administration Charge is allocated between the Subaccounts
and the Fixed Account in proportion to the respective Contract Values similarly
allocated.

The Contract Administration Charge will be waived if on any Contract Anniversary
the Contract Value is $75,000 or greater.

ADMINISTRATIVE EXPENSE CHARGE

We deduct an Administrative Expense Charge from each Subaccount during each
Valuation Period which is equal, on an annual basis, to 0.15% of the net asset
value of the Subaccount. This charge is designed to compensate us for the cost
of administering the Contracts and the Separate Account. The Administrative
Expense Charge is assessed during both the Accumulation Period and the Annuity
Period. The Contract Administration Charge and the Administrative Expense Charge
are designed, in the aggregate, to be at cost with no margin included for
profit.

TRANSFER FEE

In general, a transfer fee of $25 may be assessed on the second and each
subsequent transaction in each calendar month in which transfer(s) are effected
between Subaccount(s) and/or the Fixed Account. We currently are waiving this
fee.

The transfer fee will be deducted from Contract Values which remain in the
Subaccount(s) or Fixed Account from which the transfer was made. If such
remaining Contract Value is insufficient to pay the transfer fee, then the fee
will be deducted from transferred Contract Values. The transfer fee is designed
to be at cost with no margin included for profit.

SALES CHARGES

WITHDRAWAL CHARGE

Withdrawals may be subject to penalties or income tax. Additional restrictions
may apply to Contracts held in Qualified Plans. Subject to those limitations,
the Contract Value may be withdrawn at any time during the Accumulation Period.
You should consult your own tax counsel or other tax advisers regarding any
withdrawals. (See "Taxes - Tax Treatment of Withdrawals" on page 22.)

A contingent deferred sales charge, which is referred to as the Withdrawal
Charge, may be imposed upon certain withdrawals. No withdrawal charge is applied
in the following situations: (1) On annuitization (unless the settlement option
chosen is payment over a period certain of less than 5 years); (2) the payment
of a death benefit; (3) Withdrawal of an Old Purchase Payment or an amount
available as a free withdrawal (see p. 13); (4) Certain withdrawals for
Contracts issued under 403(b) plans or 401 plans under our prototype (See Waiver
of Withdrawal Charge for Certain Qualified Plan Withdrawals, p. 14); (5)
Withdrawal under Contracts issued to employees of Lincoln Benefit Life Company
or its affiliates or issued to spouses or minor children of such employees.

In no event will a withdrawal charge be waived or eliminated where such waiver
or elimination would be unfairly discriminatory to any person or where it is
prohibited by state law.

The Withdrawal Charge is a percentage of Purchase Payments withdrawn that are
less than seven years old

12
<PAGE>

and not eligible for a free withdrawal, in accordance with the Withdrawal Charge
Table shown below:

WITHDRAWAL CHARGE TABLE

<TABLE>
<CAPTION>
Contribution Withdrawal Charge
Year Percentage
---- ----------
<S> <C>

First and Second 7
Third 6
Fourth 5
Fifth 4
Sixth 3
Seventh 2
Eighth and later 0
</TABLE>

The Withdrawal Charge is deducted from the remaining Contract Value so that the
actual reduction in Contract Value as a result of the withdrawal will be greater
than the withdrawal amount requested and paid.

For purposes of determining the Withdrawal Charge, the Contract Value is deemed
to be withdrawn in the following order:

FIRST. Earnings-- the amount of Contract Value in excess of all Purchase
Payments that have not previously been withdrawn and less any Large Case
Credit (see "Large Case Credit," Page 17);

SECOND. "Old Purchase Payments" - Purchase Payments received by us more than
seven years prior to the date of withdrawal which have not been previously
withdrawn;

THIRD. Any additional amounts available as a "Free Withdrawal," as described
below;

FOURTH. "New Purchase Payments" - Purchase Payments received by us less than
seven years prior to the date of withdrawal. These Payments are deemed to be
withdrawn on a first-in, first-out basis.

The amounts obtained from the Withdrawal Charge will be used to pay sales
commissions and other promotional or distribution expenses associated with the
marketing of the Contracts. To the extent that the Withdrawal Charge is
insufficient to cover all sales commissions and other promotional or
distribution expenses, we may use any of our corporate assets, including
potential profit which may arise from the Mortality and Expense Risk Charge,
above, to make up any difference.

FREE WITHDRAWAL

Withdrawals of the following amounts are never subject to the Withdrawal Charge:

a. In any Contract Year, the greater of earnings not previously withdrawn or 10
percent of New Purchase Payments; and

b. Any Old Purchase Payments which have not been previously withdrawn.

However, see "Tax Treatment of Withdrawals," on page 21.

In addition, in states where available, a Confinement Waiver benefit provides
that any applicable Withdrawal Charge will be waived if the following conditions
are satisfied:

1. The Annuitant must be confined to a Long Term Care Facility or a Hospital for
at least 60 consecutive days. Confinement must begin after the Issue Date;

2. You must request the withdrawal no later than 90 days following the date that
confinement has ceased. Written proof of confinement must accompany the
withdrawal request; and

3. For confinements in a Long Term Care Facility, confinement must be prescribed
by a physician and be medically necessary.

LONG TERM CARE FACILITY means a facility located in the United States of America
which is licensed by the jurisdiction in which it is located and operated as a
Custodial Care Facility or other facility which provides a level of care and
services at least as great as those provided by a Custodial Care Facility. Long
Term Care Facility does not include any place owned or operated by a member of
the insured's immediate family.

CUSTODIAL CARE FACILITY means a facility which:

1. Provides custodial care under the supervision of a Registered Nurse; and

2. Can accommodate three or more persons at those persons' expense.

HOSPITAL means a facility which:

1. Is licensed by the jurisdiction in which it is located and operated as a
hospital;

2. Is supervised by a staff of licensed physicians;

3. Provides continuous nursing service 24 hours a day by or under the
supervision of a Registered Nurse;

4. Operates primarily for the care and treatment of sick or injured persons as
inpatients for a charge; and

5. Has medical, diagnostic and major surgical facilities or has access to such
facilities.

MEDICALLY NECESSARY means confinement, care or treatment which is appropriate
and consistent with the diagnosis in accordance with accepted standards of
practice, and which could not have been omitted without adversely affecting the
insured's condition.

PHYSICIAN means a licensed medical doctor (M.D.) or a licensed doctor of
osteopathy (D.O.) operating within the scope of his or her license. The term
does not include the insured or a member of the insured's immediate family.

REGISTERED NURSE means a registered graduate professional nurse (R.N.).

IMMEDIATE FAMILY means the insured's spouse, children, parents, grandparents,
grandchildren, siblings, or corresponding in-laws.

This benefit will not be applicable to the extent it does not comply with the
provisions of the Qualified Plan for

13
<PAGE>

which the Contract is issued. Also see "Taxes" on page 21 for a discussion of
the tax issues involved.

WAIVER OF WITHDRAWAL CHARGE FOR CERTAIN QUALIFIED PLAN WITHDRAWALS

For contracts isued under a 403 (b) plan or a 40l plan under our prototype, we
will waive the Withdrawal Charge when: (1) the annuitant becomes disabled (as
defined in Code Section 72(m) (7)); or (2) the annuitant attains age 59 1/2 and
at least 5 Contract Years have elapsed; or (3) at least 15 Contract Years have
elapsed. Our prototype is a Section 401 Defined Contribution Qualified
Retirement plan. This is a prototype plan which may be established as a Money
Purchase plan, a Profit Sharing plan, or a paired plan (Money Purchase and
Profit Sharing).

PREMIUM TAXES

Premium taxes or other taxes payable to a state or other governmental entity
will be charged against the Contract Values. Some states assess premium taxes at
the time Purchase Payments are made; others assess premium taxes at the time
annuity payments begin. We will deduct any applicable premium taxes upon full
surrender, death, or annuitization. Premium taxes generally range from 0% to
3.5%.

DEDUCTION FOR SEPARATE ACCOUNT INCOME TAXES

While we are not currently maintaining a provision for taxes, we have reserved
the right to establish such a provision for taxes in the future if we determine,
in our sole discretion, that we will incur a tax as a result of the operation of
the Separate Account. We will deduct for any taxes we incur as a result of the
operation of the Separate Account whether or not there was a provision for taxes
and whether or not it was sufficient. (See "Taxes," Page 21.)

OTHER EXPENSES

The charges and expenses applicable to the various Portfolios are borne
indirectly by Contract Owners having Contract Values allocated to the
Subaccounts that invest in the respective Funds. For a summary of current
estimates of those charges and expenses, see "Fee Tables," Page 6. For more
detailed information about those charges and expenses, please refer to the
prospectuses for the appropriate Fund(s). Lincoln Benefit Life may receive
compensation from the investment advisors or administrators in connection with
administrative service and cost savings experienced by the investment advisors
or administrators.

DESCRIPTION OF THE CONTRACTS

SUMMARY

The Contracts provide for the accumulation of Contract Values during the
Accumulation Period. See "Purchases, Withdrawals and Contract Value," beginning
at Page 15. Upon Annuitization, benefits are payable under the Contracts in the
form of an annuity, either for the life of the Annuitant or for a fixed number
of years. See, "Annuity Period - Annuity Options," Page 20.

CONTRACT OWNER

The Contract Owner ("You") is the person normally entitled to exercise all
rights of ownership under the Contracts. You are also normally the person
entitled to receive benefits under the Contract, although you may, subject to
limitations in the case of Qualified Plans, designate an alternative payee.

ANNUITANT

The Annuitant is the natural person on whose life annuity payments under a
Contract depend. You may change the designated Annuitant at any time prior to
the Annuity Date. In the case of a Contract issued in connection with a plan
qualified under Section 403(b) or 408 of the Code, you are the Annuitant. You
may also designate a second person on whose life, together with that of the
Annuitant, annuity payments depend. Additional restrictions may apply in the
case of Qualified Plans (See "Taxes," page 21). If you are not the Annuitant
and the Annuitant dies before the Annuity Date, then you become the new
Annuitant unless you name another person as the new Annuitant. You must attest
to the Annuitant being alive before we will annuitize a Contract.

MODIFICATION OF THE CONTRACT

Only a Lincoln Benefit Life officer may approve a change in or waive any
provisions of the Contract. Any change or waiver must be in writing. No agent
has the authority to change or waive the provisions of the Contract.

We reserve the right to change the terms of the Contract as may be necessary to
comply with changes in applicable law. If a provision or provisions of the
Contract are inconsistent with state law, state law will control.

ASSIGNMENT

You may assign Contracts issued pursuant to Non-Qualified Plans that are not
subject to Title 1 of the Employee Retirement Income Security Act of 1974
("ERISA") at any time during the lifetime of the Annuitant prior to the Annuity
Date. We will not be bound by any assignment until we receive written notice of
it. We are not responsible for the validity of any assignment. An assignment
will not affect any payments we may make or actions we may take before we
receive notice of the assignment.

If the Contract is issued pursuant to a Qualified Plan (or a Non-Qualified Plan
that is subject to Title 1 of ERISA), it may not be assigned, pledged or
otherwise transferred except under such conditions as may be allowed under
applicable law.

BECAUSE AN ASSIGNMENT MAY BE A TAXABLE EVENT, YOU SHOULD CONSULT A COMPETENT TAX
ADVISER SHOULD YOU WISH TO ASSIGN YOUR CONTRACT.

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DEATH BENEFIT

We will pay the Death Benefit when due proof of death is received while the
Contract is in force and before the Annuity Date, if:

the Contract Owner dies; or

the Annuitant dies and the Contract Owner is not a natural person.

The Beneficiary will become the new Contract Owner and may elect, within 60 days
of the date of death, to receive the Death Benefit in a lump sum or apply the
Death Benefit to receive a series of equal payments over the life of the
Beneficiary or a period not to exceed the life expectancy of the Beneficiary.
Lifetime or life expectancy payments must begin within one year of the deceased
Contract Owner's death.

If there is only one Beneficiary, he or she may elect to defer payment of the
Contract Value for up to five years from the date of death. Any remaining funds
must be distributed at the end of the five year period. An Annuitant is
necessary to continue the Contract between the date of death and the final
distribution. If there is no Annuitant at that time, the Beneficiary will be
the new Annuitant.

If the Beneficiary is the Contract Owner's spouse, then the Contract can
continue as if death had not occurred. If there is no Annuitant at that time,
the new Annuitant will be the surviving spouse. The surviving spouse may also
select one of the options listed above.

If the Beneficiary is not a natural person, then the Beneficiary must receive
the Death Benefit in a lump sum, and the options listed above are not available.

Similar rules may apply to Contracts issued in connection with Qualified Plans.

The Death Benefit is calculated as of the date of settlement. At a minimum, the
Death Benefit is the greater of:

(1) All Purchase Payments less prior withdrawals, accumulated at 4% per year
prior to the Contract Anniversary next following your 75th birthday, and at 0%
per year thereafter (This is called the "Floor Value" calculation); or

(2) The Contract Value less any applicable premium tax. In addition, if the
Contract Value on the 7th Contract Anniversary is greater than the Floor Value
at that time, the Floor Value will be raised to the level of the Contract Value.
In such event, Floor Values for years 8 and beyond will be calculated using the
"stepped-up" value on the seventh anniversary.

BENEFICIARY

The Beneficiary will receive the Death Benefit when the Contract Owner dies.
The Beneficiary is as stated in the application unless changed.

If a Beneficiary is not named or if the Beneficiary named is no longer living,
the beneficiary will be:

the Contract Owner's spouse if living, otherwise;

the Contract Owner's children equally if living, otherwise;

the Contract Owner's estate.

If there is more than one Beneficiary, the Company will pay the Death Benefit to
the Beneficiaries according to the most recent written instructions received
from you. If there are no written instructions the Company will pay the Death
Benefit in equal shares to the Beneficiaries who are to share the funds. If one
of the Beneficiaries predeceases the Contract Owner, the Death Benefit will be
paid to the surviving Beneficiaries.

You may name new Beneficiaries. We will provide a form to be signed and filed
with us. Upon receipt, it is effective as of the date you signed the form,
subject to any action we have taken before it was received.

Other rules may apply to Contracts issued in connection with Qualified Plans.

VOTING RIGHTS OF CONTRACT OWNERS

Except to the extent restricted by the retirement plan pursuant to which a
Contract was issued, you have a voting interest in each Subaccount to which you
have allocated your Contract Value. The voting interest in a Subaccount is
based upon your proportionate interest in the Subaccount as measured by
Accumulation and Annuity Units. (See "Separate Account Investments -- Voting
Rights," Page 11, and "Purchases, Withdrawals and Contract Value - Allocation of
Purchase Payments," Page 16).

PURCHASES, WITHDRAWALS AND
CONTRACT VALUE

MINIMUM PURCHASE PAYMENT

The minimum initial Purchase Payment for a Contract is $1,200 (payable over the
first Contract Year) and the total of all Purchase Payments may not exceed $1
million without our prior approval. Minimum subsequent Purchase Payments may be
made in amounts of $100 or more ($25 or more if made in connection with an
Automatic Payment Plan, described below). We may lower these minimums at our
sole discretion. We reserve the right to refuse any Purchase Payment at any
time. We may not issue a Contract to a Purchaser who has attained age 81, or
where the Annuitant has attained age 81.

AUTOMATIC PAYMENT PLAN

You may make scheduled subsequent Purchase Payments of $25.00 or more per month
by automatic payment through your bank account. An enrollment form for this
program is available through us.

AUTOMATIC DOLLAR COST AVERAGING PROGRAM

Owners who wish to purchase units of the Subaccounts or the Fixed Account over a
period of time may be able to do so through the Automatic Dollar Cost Averaging
("DCA") Program. Under this program, you may autho-

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rize the automatic transfer of a fixed dollar amount from the Fixed Account or a
Subaccount of your choosing (the "Source Subaccount") to up to eight options,
including other Subaccounts or the Fixed Account, at the unit values determined
on the dates of the transfers. The interval between transfers may be monthly,
quarterly, or annually, at your option. The transfers will continue until you
instruct otherwise, or until there is not enough money in the Source Subaccount
to make the transfer, whichever is earlier. Currently, there is no minimum
transfer amount required. We reserve the right to impose a minimum amount that
may be transferred among the investment options under the Contract. Special DCA
considerations apply with respect to transfers from the Fixed Account. (See
Transfers, Page 17.)

The theory of dollar cost averaging is that greater numbers of units are
purchased at times when the unit prices are relatively low than are purchased
when the prices are higher. This has the effect, when purchases are made at
fluctuating prices, of reducing the aggregate average cost per unit to less than
the average of the unit prices on the same purchase dates. However,
participation in the DCA Program does not assure you of a greater profit from
your purchases under the Program; nor will it prevent or necessarily alleviate
losses in a declining market.

You may elect to increase, decrease or change the frequency or amount of
Purchase Payments under a Dollar Cost Averaging Program. The application and any
Purchase Payments should be sent to Lincoln Benefit Life Company, P.O. Box
82532, Lincoln, Nebraska 68501-2532.

PORTFOLIO REBALANCING

Portfolio rebalancing allows you to maintain the percentage of your Contract
Value allocated to each Subaccount at a pre-set level prior to annuitization.
For example, you could specify that 30% of your Contract Values should be in the
Balanced Portfolio, 40% in the Growth Portfolio-Janus Aspen Series and 30% in
Federated High Income Bond Fund II. Over time, the variations in each
Subaccount's investment results will shift this balance of your Contract Value
allocations. If you elect the portfolio rebalancing feature, we will
automatically transfer your Contract Value back to the percentages you specify,
but only if investment results shift greater than minimum requirements that we
establish.

You may choose to have rebalances made monthly, quarterly, semi-annually, or
annually until your Annuity Date; portfolio rebalancing is not available after
you annuitize. No Transfer Fees will be charged for portfolio rebalancing. No
more than eight Subaccounts can be included for portfolio rebalancing at any
time.

Procedures for selecting portfolio rebalancing are generally the same as those
discussed in detail above for selecting dollar cost averaging. You may make your
request at any time prior to your Annuity Date and it will be effective when we
receive it in good form. If you stop portfolio rebalancing, you must wait 30
days to begin again. You may specify a date for your first rebalance, or we will
treat your request as if you selected the request's effective date. If you
specify a date fewer than 30 days after your Issue Date, your first rebalance
will be delayed one month and if you request rebalancing on your application but
do not specify a date for the first rebalance, it will occur one period after
your Issue Date. If those Subaccounts, collectively, selected for rebalancing
fall below any minimum value that we may establish, we have the right, at our
option, to prohibit or limit the use of portfolio rebalancing. You may not use
dollar cost averaging and portfolio rebalancing at the same time. We may change,
terminate, limit, or suspend portfolio rebalancing at any time.

CONTRACT VALUE

We will establish an account for you and will maintain your account during the
Accumulation Period. The value of a Contract for any Valuation Period is equal
to the sum of the variable accumulation values of the Subaccounts for that
Valuation Period, plus the value of the Fixed Account.

SEPARATE ACCOUNT ACCUMULATION UNIT VALUE

Accumulation Unit Value is determined Monday through Friday on each day that the
New York Stock Exchange is open for business.

A separate Accumulation Unit Value is determined for each Subaccount. If we
elect or are required to assess a charge for taxes, a separate Accumulation Unit
Value may be calculated for Contracts issued in connection with Non-Qualified
and Qualified Plans, respectively, within each Subaccount.

The Accumulation Unit Value for each Subaccount will vary with the price of a
share in the Portfolio the Subaccount invests in, and in accordance with the
Mortality and Expense Risk Charge, Administrative Expense Charge, and any
provision for taxes. Assessments of Withdrawal Charges, transfer fees and
Contract Administration Charges are made separately for each Contract. They are
effected by redemption of Accumulation Units and do not affect Accumulation Unit
Value.

The Accumulation Unit Value of a Subaccount for any Valuation Period equals the
Accumulation Unit Value as of the immediately preceding Valuation Period,
multiplied by the Net Investment Factor for that Subaccount for the current
Valuation Period. The Net Investment Factor is a number representing the change
on successive Valuation Dates in value of Subaccount assets due to investment
income, realized or unrealized capital gains and losses, deductions for taxes,
if any, and deductions for the Mortality and Expense Risk Charge and
Administrative Expense Charge. If the Net Investment Factor for a Subaccount is
greater than one, the Accumulation Unit Value of that Subaccount has increased.
If the Net Investment Factor is less than one, the Subaccount's Accumulation
Unit value has decreased.

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ALLOCATION OF PURCHASE PAYMENTS

Purchase Payments are allocated to the Subaccount(s)and Fixed Account as you
have selected. When you make your initial Purchase Payment, you must specify
your allocation on the application for a Contract. Percentages must be in whole
numbers and the total allocation must equal 100%. All initial Purchase Payments
will be credited as of the date of receipt to the Fidelity Money Market
Subaccount. If the application is in good order, we will apply the resulting
Contract Value (from deposit of the initial Purchase Payments in the Fidelity
Money Market Subaccount) to the Subaccount(s) and/or Fixed Account, as selected,
and credit the Contract with Accumulation Units within two business days of
receipt at the Company's P.O. Box identified on the first page of this
prospectus. The number of Accumulation Units in a Subaccount attributable to
the resulting Contract Value is determined by dividing that portion which is
allocated to the Subaccount by that Subaccount's Accumulation Unit value as of
the end of the Valuation Period when the allocation occurs. If state law
requires us to return at least your Purchase Payment during the "free-look"
period, initial Purchase Payments may be allocated to the Fidelity Money Market
Subaccount for twenty days following the Issue Date, or longer if required by
state law. They will then be allocated to the Fixed Account and/or Subaccounts
you have selected.

If the application for a Contract is not in good order, we will attempt to
rectify it within five business days of our receipt. An example of an
application not being in good order would be one in which no allocation was
specified. We will credit the initial Purchase Payment within two business days
after the application has been rectified. Unless the prospective Contract Owner
consents otherwise, the application and the initial Purchase Payment will be
returned if the application cannot be put in good order within five business
days of such receipt.

When you make subsequent Purchase Payments, you should specify how you want your
payments allocated. Otherwise, we will automatically process the purchase
payment based on the then current Purchase Payment allocation.

LARGE CASE CREDIT

Wherever allowed by law, and so long as your Contract is Non-Qualified, we will
credit an additional amount ("Large Case Credit") to your Contract if your
initial Purchase Payment is at least one million ($1,000,000) dollars. We will
make this Large Case Credit with funds from our general account. The amount of
the Large Case Credit is 3% of the initial Purchase Payment.

If you return your Contract to us during the "free look period," we will deduct
the then current value of the Large Case Credit from your Contract Value before
we return the amount due you. Our understanding is that this Large Case Credit
amount is not considered to increase the cost basis of the Contract for income
tax purposes (see "Taxes," page 21). We do not include the Large Case Credit
amount in the amounts available for free withdrawal (see "Free Withdrawal," page
13).

TRANSFER DURING ACCUMULATION PERIOD

During the Accumulation Period, you may transfer Contract Values among the Fixed
Account and Subaccounts by written request or telephone authorization. NO SUCH
TRANSFERS ARE PERMITTED AFTER THE ANNUITY DATE. Currently, there is no minimum
transfer amount required. We reserve the right to impose a minimum amount that
may be transferred among the investment options under the Contract. Additional
restrictions apply to transfers from/to the Fixed Account as described below.

Transfers from the Fixed Account to the Subaccounts may only be made during the
60 day period beginning on the issue date or the Contract Anniversary unless the
transfer is made by Dollar Cost Averaging. The maximum amount which may be
transferred from the Fixed Account during a Contract Year is the greater of 30%
of the Fixed Account balance as of the last Contract Anniversary or the greatest
amount of any prior transfer from the Fixed Account. If desired, you may elect
to have the above amount transferred quarterly or monthly via Dollar Cost
Averaging. Alternatively, you may elect to transfer the entire Fixed Account
balance to the Subaccount(s) via Dollar Cost Averaging. The maximum monthly
amount allowed would be 1/36 of the Fixed Account Balance at the time of the
first tranfser. No additional transfers or payments may be made into the Fixed
Account if transfers are being made out via Dollar Cost Averaging.

Notwithstanding the above, we will allow 100% of the Fixed Account balance to be
transferred to the Subaccount(s) if either (a) or (b) occurs:

(a) If, on the last Contract Anniversary, the interest rate credited to the
Fixed Account is less than it was on the immediately preceding anniversary (or
on the issue date for the first Contract Anniversary).

(b) The credited interest rate on the last Contract Anniversary is less than 4%.

This offer will apply for 60 days following the date we mail notification to
you.

We reserve the right to defer transfers from the Fixed Account for up to six
months from the date you ask us. Also, we reserve the right to restrict
transfers from the Subaccounts to the Fixed Account each Contract Year to no
more than 30% of the Separate Account balances as of the last Contract
Anniversary. We currently are not imposing this restriction.

TRANSFERS AUTHORIZED BY TELEPHONE

Telephone calls authorizing transfers must be completed by 4:00 p.m. Eastern
time on a Valuation Date in order to be effected at the price determined on such
Date. Transfer authorizations, whether written or by telephone,

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which are received after 4:00 p.m. Eastern time will be processed as of the next
Valuation Date. A proper telephone authorization form for transfers must be on
file. A transfer fee may be assessed in connection with transfers (see "Contract
Charges - Administrative Charges - Transfer Fee," Page 12). Also, the telephone
transfer privilege may be suspended, modified or terminated at any time without
notice.

We utilize procedures that we believe provide reasonable assurance that
telephone authorized transfers are genuine. Such procedures include taping of
telephone conversations with persons purporting to authorize such transfers and
requesting identifying information from such persons. Accordingly, we disclaim
any liability for losses resulting from such transfers by reason of their
allegedly not having been properly authorized. However, if we do not take
reasonable steps to help ensure that such authorizations are valid, we may be
liable for such losses.

CONTRACT LOANS FOR 401(a), 401(k), AND 403(b) CONTRACTS

During the Accumulation Period but after the "free look" period, the Owner of a
Contract used in connection with a Tax Sheltered Annuity Plan ("TSA Plan") under
Section 403(b) of the Code, or an Owner of a Contract purchased by a pension,
profit-sharing, or other similar plan qualified under Section 401(a) of the Code
(a "401 Plan"), including a Section 401(k) plan, where a plan trustee is the
Owner, may receive a loan from the Surrender Value subject to the terms of the
Contract, the Plan, and the Code, which impose restrictions on loans.

The loan amount cannot exceed an amount which when added to any existing loan
exceeds the Surrender Value on the date of the loan. In addition, the total
loan, when added to the outstanding loan balance under all other plans of the
participant, may not exceed the lesser of (a) or (b) where:

(a) is $50,000 reduced by the excess of the highest outstanding loan balance
during the prior 12 month period over the outstanding balance of loans; and

(b) is the greater of $10,000 or 1/2 of the Surrender Value.

The minimum loan amount is $1,000.

The Owner has the sole responsibility for requesting loans and making loan
repayments that comply with applicable tax requirements. Loans must comply with
the applicable provisions of Section 72 of the Code and Title 1 of ERISA.
Please seek advice from your plan administrator or tax advisor.

When a loan is made, a portion of the Surrender Value sufficient to secure the
loan will be transferred to the Loan Account reducing the Contract Value in the
Separate Acccount and/or the Fixed Account. Unless instructed to the contrary
by the Contract Owner, we will first transfer to the Loan Account amounts from
the Separate Account in proportion to the assets in each Subaccount until the
required balance is reached or all such variable units are exhausted. The
remaining required collateral will next be transferred from the Fixed Account.
No withdrawal charges are deducted at the time of the loan, or on the transfer
from the Variable Account to the Fixed Account.

Amounts transferred to the Loan Account will accrue interest at an annual rate
2.25% less than the loan interest rate fixed by us for the term of the loan.
However, the interest rate credited to the Loan Account will never be less than
the Fixed Account guaranteed rate of 3%. Amounts transferred to the Loan
Account will no longer be affected by the investment experience of the Separate
Account.

The Death Benefit and Contract Value available for partial withdrawal or
surrender, as well as the amount applied on the Annuity Date to provide annuity
payments will be reduced by the amount of the loan outstanding plus accrued
interest.

You must repay any loan within five years of the date the loan is made.
Scheduled payments must be level, amortized over the repayment period, and made
at least quarterly. A repayment period of 15 or 30 years is acceptable if the
loan proceeds are used to acquire a dwelling unit which is to be used by you as
a principal residence. Other repayment periods may be available at our
discretion.

Loan repayments must be identified as such; otherwise, they may be credited to
the Contract as Purchase Payments.

If a loan payment is not made when due, interest will continue to accrue. We
will declare the entire loan in default. The defaulted loan balance plus
accrued interest will be deducted from any future Distribution under the
Contract and paid to us. Any defaulted amount plus interest will be treated as
a Distribution (as permitted by law) and may be taxable to the borrower, may be
subject to the early withdrawal tax penalty, and will be subject to the
mandatory 20% federal withholding.

If the total loan amount exceeds the Surrender Value, we will mail written
notice to your last known address. The notice will state the amount needed to
maintain the Contract in force. If payment of this amount is not received
within 31 days after the date this notice is mailed, the Contract will
terminate.

We reserve the right to defer making any loan for 6 months after you ask us for
it, unless the loan is to pay a premium to us.

WITHDRAWALS (REDEMPTIONS)

Except as explained below, you may redeem a Contract for all or a portion of its
Contract Value during the Accumulation Period. Withdrawal Charges may be
applicable, however, which would reduce the Contract Value upon redemption.
(See "Contract Charges - Withdrawal Charge" on Page 12 for additional
information.)

Withdrawals and distributions from Contracts issued in connection with certain
Qualified Plans may be subject to a mandatory 20% withholding requirement.
See

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"Taxes -- Withholding Tax on Distributions," on Page 22.

Withdrawals of amounts attributable to contributions made pursuant to a salary
reduction agreement (in accordance with Section 403(b)(11) of the Code) are
limited to circumstances only: when you attain age 59 1/2, separate from
service, die, become disabled (within the meaning of Section 72(m)(7) of the
Code), or in the case of hardship. Withdrawals for hardship are restricted to
the portion of the Contract Value which represents your contributions and does
not include any investment results. These limitations on withdrawals apply to:
(1) salary reduction contributions made after December 31, 1988; (2) income
attributable to such contributions; and (3) income attributable to amounts held
as of December 31, 1988. The limitations on withdrawals do not affect transfers
between certain Qualified Plans. Additional restrictions and limitations may
apply to distributions from any Qualified Plan. Tax penalties may also apply.
You should seek competent tax advice regarding any withdrawals or distributions
from Qualified Plans. (See "Tax Treatment of Withdrawals," beginning at Page
22.) Except in connection with a Systematic Withdrawal Program, described
below, the minimum partial withdrawal amount is $250, or, if less, your entire
interest in the Subaccount from which a withdrawal is requested.

A written withdrawal request or systematic withdrawal program enrollment form,
as the case may be, must be sent to us. For partial withdrawals, you may
allocate the amount among the Subaccounts of the Separate Account. The required
program form will not be in good order unless it includes your Tax I.D. Number
(e.g., Social Security Number) and provides instructions regarding withholding
of income taxes. We provide the required forms. The amount of the partial
withdrawal will be allocated proportionately from the Subaccounts and the Fixed
Account, unless you specify otherwise.

If the request is for total withdrawal, the Contract must be submitted. The
Surrender Value is determined on the basis of the Contract Value next computed
following receipt of a request in proper order. The Surrender Value will
normally be paid within seven days after the day we receive a proper request.
However, we may suspend the right of withdrawal from the Separate Account or
delay payment for such withdrawal more than seven days: (1) during any period
when the New York Stock Exchange ("NYSE") is closed (other than customary
weekend and holiday closings); (2) when trading on the NYSE is restricted or an
emergency exists as determined by the Securities and Exchange Commission so that
disposal of the Separate Account's investments or determination of Accumulation
Unit values is not reasonably practicable; or (3) for such other periods as the
Securities and Exchange Commission, by order, may permit for your protection.
In addition, we may delay payment of the Surrender Value in the Fixed Account
for up to 6 months (or a shorter period if required by applicable law).

SYSTEMATIC WITHDRAWAL PROGRAM

Owners of Contracts issued in connection with Non-Qualified Plans and IRAs may
choose to participate in a Systematic Withdrawal Program. You must complete an
enrollment form and send it to us. The withholding election section of the
enrollment form must be complete before the Systematic Withdrawals will begin.
Systematic Withdrawals of a flat dollar amount, earnings, or a percentage of
Purchase Payments are available. Systematic Withdrawals are treated the same as
partial withdrawals for purposes of determining if a withdrawal charge applies.
Systematic Withdrawals are offered on a monthly, quarterly, semi-annual, or
annual basis.

Depending on fluctuations in the net asset value of the Subaccounts and the
value of the Fixed Account, Systematic Withdrawals may reduce or even exhaust
the Contract Value. The minimum amount of each Systematic Withdrawal is $50.

Systematic Withdrawal payments are made only to you. We reserve the right to
modify or suspend the Systematic Withdrawal Program and to charge a processing
fee for the service. If we modify or suspend the Systematic Withdrawal Program,
existing Systematic Withdrawal payments will not be affected.

ERISA PLANS

Spousal consent may be required when a married Participant seeks a distribution
from a Contract that has been issued in connection with a Qualified Plan (or a
Non-Qualified Plan that is subject to Title 1 of ERISA). You should obtain
competent advice.

MINIMUM CONTRACT VALUE

If the Contract Value is less than $250 and no Purchase Payments have been made
during the previous three full calendar years, we reserve the right, after 60
days written notice to you, to terminate the Contract and distribute its
Surrender Value to you. This privilege will be exercised only if the Contract
Value has been reduced to less than $250 as a result of withdrawals, and state
law permits. In no instance shall such termination occur if the value has
fallen below $250 due to either decline in Accumulation Unit value or the
imposition of fees and charges. Other rules may apply to Contracts issued in
connection with Qualified Plans.

ANNUITY PERIOD

ANNUITY DATE

You select an Annuity Date (the date on which annuity payments are to begin) at
the time of application. The Annuity Date must always be the tenth day of a
calendar month. Also, we reserve the right to require the Annuity Date be at
least two years from the Issue Date, unless an earlier date is required by law.
Annuity payments will begin in any event no later than the Latest Annuity Date.
If no Annuity Date is selected, the Annuity Date will be the Latest Annuity
Date. You may change the Annuity

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Date at any time at least seven days prior to the Annuity Date then indicated on
our records by sending written notice to us.

DEFERMENT OF PAYMENTS

We may defer for up to 15 days the payment of any amount attributable to a
Purchase Payment made by check to allow the check reasonable time to clear. We
may defer making Fixed Annuity payments for a period of up to six months or such
lesser time as state law may require. Interest, subject to state law
requirements, will be credited during the deferral period.

ANNUITY OPTIONS

No lump sum settlement option is available under the contract. You may
surrender the contract prior to the Annuity Date; however, any applicable
withdrawal charge will be deducted from the Contract Value. You may elect an
Annuity Option at any time prior to the Annuity Date. A change of Annuity
Option is permitted if made at least seven days before the Annuity Date. If no
other Annuity Option is elected, monthly annuity payments will be made in
accordance with Option B below, with 10 years (120 months) guaranteed (or Option
C in the case where payments are to be made for the joint lives of the Annuitant
and a designated second person and for the life of the survivor). Annuity
payments will be made in monthly, quarterly, semi-annual or annual installments
as you select. However, if the amount available to apply under an Annuity
Option is less than $5,000, and state law permits, we have the right to pay the
annuity in one lump sum. In addition, if the first payment provided would be
less than $50, and state law permits, we shall have the right to require the
frequency of payments be at quarterly, semi-annual or annual intervals so as to
result in an initial payment of at least $50.

NO WITHDRAWALS OF CONTRACT VALUE ARE PERMITTED DURING THE ANNUITY PERIOD FOR ANY
ANNUITY OPTION INVOLVING LIFE CONTINGENCIES.

The following Annuity Options are generally available under the Contract. Each
is available in the form of either a Fixed Annuity or a Variable Annuity (or a
combination of both Fixed and Variable Annuity). Fixed Account Contract Values
will be applied to provide a Fixed Annuity. However, there may be restrictions
in the retirement plan pursuant to which a Contract has been purchased. Annuity
payments are made on the Valuation Date on or immediately following the tenth of
the month, beginning on the Annuity Date.

Option A, Life Annuity. Monthly payments are made during the Annuitant's life,
starting with the Annuity Date. No payments will be made after the Annuitant
dies. It is possible for the payee to receive only one payment under this
option, if the Annuitant dies before the second payment is due.

Option B, Life Annuity with Payments Guaranteed for 5 to 20 Years. Monthly
payments are made starting on the Annuity Date. Payments will continue as long
as the Annuitant lives. If the Annuitant dies before all of the guaranteed
payments have been made, we will continue installments of the guaranteed
payments to the Beneficiary.

Option C, Joint and Full Survivor Annuity. Monthly payments are made starting
with the Annuity Date. Payments will continue as long as either the Annuitant
or the joint Annuitant is alive. Payments will stop when both the Annuitant and
the joint Annuitant have died. It is possible for the payee or payees under this
option to receive only one payment, if both Annuitants die before the second
payment is due.

Option D, Payments for a Specified Period Certain, 5 Years to 25 Years. Monthly
payments are made starting on the Annuity Date, and continuing for the specified
period of time, as elected. If the Annuitant dies before all of the guaranteed
payments have been made, we will continue installments of the guaranteed
payments to the Beneficiary.

OTHER OPTIONS

We may have other annuity options available. Information about them may be
obtained by writing or calling us.

With respect to Contracts issued under Sections 401, 403(b) or 408 of the
Internal Revenue Code, any payments will be made only to you and/or your spouse.

DEATH BENEFIT DURING ANNUITY PERIOD

If the Annuitant dies after the Annuity Date while the Contract is in force, the
death proceeds, if any, will depend upon the Annuity Option in effect at the
time of the payee's death. If the Annuitant dies after the Annuity Date and
before the entire interest in the Contract has been distributed, the remaining
interest, if any, as provided for in the Option elected, will be distributed at
least as rapidly as under the method of distribution in effect at the
Annuitant's death.

VARIABLE ANNUITY PAYMENTS

The basic objective of a Variable Annuity Contract is to provide Variable
Annuity payments which will be to some degree responsive to changes in the
economic environment. The amount of Variable Annuity Payments ("Payments")
depends upon the investment experience of the Portfolios you have selected, any
premium taxes, the age and sex of the Annuitant, and the Annuity Option chosen.
We guarantee that the Payments will not be affected by (1) actual mortality
experience and (2) the amount of our administration expenses.

The Contracts offered by this prospectus (except in states which require unisex
annuity tables) contain life annuity tables that provide for different benefit
payments to men and women of the same age. Nevertheless, in accordance with the
U.S. Supreme Court's decision in Arizona Governing Committee v. Norris, in
certain employment-related situations, annuity tables that do not vary on the
basis of sex may be used. Accordingly, if the Contract is to be used in
connection with an employment-related retirement or benefit plan, consideration
should be given,

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<PAGE>

in consultation with legal counsel, to the impact of Norris on any such plan
before making any contributions under these Contracts.

The Payments may be more or less than the total Purchase Payments made because
(a) Payments vary with the investment results of the underlying Portfolios; (b)
you bear the investment risk with respect to all amounts allocated to the
Separate Account, and (c) Annuitants may die before the actuarial life
expectancy is achieved. As such, the amount of the Payments cannot be predicted.

The duration of the Annuity Option will affect the dollar amounts of each
Payment. For example, if an annuity option guaranteed for life is chosen, the
Payments will be greater than Payments under an annuity option for a minimum
specified period and guaranteed thereafter for life.

If the actual net investment experience is less than the assumed investment
rate, then the dollar amount of the Payments will decrease. The dollar amount
of the Payments will stay level if the net investment experience equals the
assumed investment rate and the dollar amount of the Payments will increase if
the net investment experience exceeds the assumed investment rate. The assumed
annual investment rate is 3 1/2%.

ADMINISTRATION

We have primary responsibility for all administration of the Contracts and the
Separate Account. Our mailing address is P.O. Box 82532, Lincoln, Nebraska
68501-2532, and our telephone number is 1-800-865-5237.

The administrative services provided include, but are not limited to: issuance
of the Contracts; maintenance of Contract Owner records; Contract Owner
services; calculation of unit values; and preparation of Contract Owner reports.

Contract statements and transaction confirmations are mailed to you at least
quarterly. You should therefore give us prompt written notice of any address
change. You should read your statements and confirmations carefully and verify
their accuracy. Questions about periodic statements should be communicated to
us promptly. We will investigate all complaints and make any necessary
adjustments retroactively, provided that we have received notice of a potential
error within a reasonable time period after the date of the questioned
statement. If we have not received notice of a potential error within this
time, any adjustment shall be made as of the date that we receive notice of the
potential error.

We will also provide you with such additional periodic and other reports,
information and prospectuses as may be required by federal securities laws.

TAXES

NOTE: The following description is based upon our understanding of current
federal income tax law applicable to annuities in general. We cannot predict
the probability that any changes in such laws will be made. Purchasers are
cautioned to seek competent tax advice regarding the possibility of such
changes. We do not guarantee the tax status of the Contracts. Purchasers bear
the complete risk that the Contracts may not be treated as "annuity contracts"
under federal income tax laws.

GENERAL

Section 72 of the Internal Revenue Code of 1986, as amended (the "Code") governs
taxation of annuities in general. A Contract Owner who is a natural person is
not taxed on increases in the value of a Contract until distribution occurs,
either in the form of a non-annuity distribution or as annuity payments under
the Annuity Option elected. For a lump sum payment received as a total
surrender (total redemption), the recipient is taxed on the portion of the
payment that exceeds the cost basis of the Contract. For a payment received as
a withdrawal (partial redemption), federal tax liability is determined on a
last-in, first-out basis, meaning taxable income is withdrawn before the cost
basis of the Contract is withdrawn. For Contracts issued in connection with Non-
Qualified Plans, the cost basis is generally the Purchase Payments, while for
Contracts issued in connection with Qualified Plans there may be no cost basis.
The taxable portion of the lump sum payment is taxed at ordinary income tax
rates. Tax penalties may also apply.

For annuity payments, the taxable portion is determined by a formula which
establishes the ratio that the cost basis of the Contract bears to the total
value of annuity payments for the term of the annuity Contract. The taxable
portion is taxed at ordinary income tax rates. Contract Owners, Annuitants and
Beneficiaries under the Contracts should seek competent financial advice about
the tax consequences of distributions under the retirement plan under which the
Contracts are purchased.

All Non-Qualified annuity Contracts that are issued by the Company (or its
affiliates) to the same Owner during any calendar year will be aggregated and
treated as one annuity Contract for purposes of determining the amount
includable in gross income under section 72(e) of the Code. Accordingly, an
Owner should consult a competent tax adviser before purchasing more than one
Non-Qualified annuity Contract. Further, if a Non-Qualified Contract has an
Owner who is not a natural person, a change of Annuitant will cause the Contract
to be treated as if the Contract Owner died.

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

We are taxed as a life insurance company under the Code. For federal income tax
purposes, the Separate Account is not a separate entity from us and its
operations form a part of the Company.

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<PAGE>

WITHHOLDING TAX ON DISTRIBUTIONS

The Code generally requires us (or, in some cases, a plan administrator) to
withhold tax on the taxable portion of any distribution or withdrawal from a
Contract. For "eligible rollover distributions" from Contracts issued under
certain types of Qualified Plans, 20% of the distribution must be withheld,
unless the payee elects to have the distribution "rolled over" to another
eligible plan in a direct "trustee to trustee" transfer. This requirement is
mandatory and cannot be waived by the Contract Owner. Withholding on other types
of distributions can be waived.

An "eligible rollover distribution" is the estimated taxable portion of any
amount received by a covered employee from a plan qualified under Section 401(a)
or 403(a) of the Code (these rules do not apply to Section 408(b) Contracts), or
from a tax-sheltered annuity qualified under section 403(b) of the Code (other
than (1) annuity payments for the life (or life expectancy) of the employee, or
joint lives (or joint life expectancies) of the employee and his or her
designated beneficiary, or for a specified period of ten years or more; and (2)
distributions required to be made under the Code). Failure to "roll over" the
entire amount of an eligible rollover distribution (including an amount equal to
the 20% portion of the distribution that was withheld) could have adverse tax
consequences, including the imposition of a penalty tax on premature
withdrawals, described later in this section.

Withdrawals or distributions from a Contract other than eligible rollover
distributions are also subject to withholding on the estimated taxable portion
of the distribution, but the Contract Owner may elect in such cases to waive the
withholding requirement. If not waived, withholding is imposed (1) for periodic
payments, at the rate that would be imposed if the payments were wages, or (2)
for other distributions, at the rate of 10%. If no withholding exemption
certificate is in effect for the payee, the rate under (1) above is computed by
treating the payee as a married individual claiming 3 withholding exemptions.

In addition, some states may require that state income tax be withheld.

TAX TREATMENT OF ASSIGNMENTS

An assignment of a Contract may have tax consequences, and may also be
prohibited by ERISA in some circumstances. Owners should therefore consult
competent legal advisers should they wish to assign their Contracts.

TAX TREATMENT OF WITHDRAWALS

QUALIFIED PLANS

Section 72(t) of the Code imposes a 10% penalty tax on the taxable portion of
any early distribution from qualified retirement plans, including contracts
issued and qualified under Code Sections 401 (H.R. 10 and Corporate Pension and
Profit Sharing Plans), 403(b) (Tax-Sheltered Annuities) and 408(b) (IRAs).

The tax penalty will not apply to the following distributions: (1) if
distribution is made on or after the date on which the Contract Owner reaches
age 59 1/2; (2) distributions following the death or disability of the Contract
Owner or Annuitant (as applicable) (for this purpose "disability" is defined in
Section 72(m)(7) of the Code); (3) distributions that are part of substantially
equal periodic payments made not less frequently than annually for the life (or
life expectancy) of the Contract Owner or Annuitant (as applicable) or the joint
lives (or joint life expectancies) of such Contract Owner or Annuitant (as
applicable) and his or her designated beneficiary; (4) distributions to a
Contract Owner or Annuitant (as applicable) who has separated from service after
he or she has attained age 55; (5) distributions made to the Contract Owner or
Annuitant (as applicable) to the extent such distributions do not exceed the
amount allowable as a deduction under Code Section 213 to the Contract Owner or
Annuitant (as applicable) for amounts paid during the taxable year for medical
care; and (6) distributions made to an alternate payee pursuant to a qualified
domestic relations order.

The exceptions stated in items (4), (5) and (6) above do not apply in the case
of an IRA.

Limitations imposed by the Code on withdrawals from tax-sheltered annuities are
described above under "Purchases, Withdrawals and Contract Value -- Withdrawals
(Redemptions)," on Page 18.

The taxable portion of a withdrawal or distribution from Contracts issued under
certain types of plans may, under some circumstances, be "rolled over" into
another eligible plan so as to continue to defer income tax on the taxable
portion. Effective January 1, 1993, such treatment is available for any
"eligible rollover distribution" made by certain types of plans (as described
above under "Taxes -- Withholding Tax on Distributions," page 22) that is
transferred within 60 days of receipt into a plan qualified under section 401(a)
or 403(a) of the Code, a tax-sheltered annuity, an IRA, or an individual
retirement account described in section 408(a) of the Code. Plans making such
eligible rollover distributions are also required, with some exceptions
specified in the Code, to provide for a direct "trustee to trustee" transfer of
the distribution to an eligible transferee plan designated by the
recipient.

Amounts received from IRAs may also be rolled over into other IRAs, individual
retirements accounts or certain other plans, subject to limitations set forth in
the Code.

NON-QUALIFIED PLANS

Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the Contract Value exceeds the aggregate
Purchase Payments made, any amount withdrawn not in the form of an annuity
payment will be treated as coming first from the earnings and then, only after
the income portion is exhausted, as coming from the principal. Withdrawn
earnings are includable in a taxpayer's gross income. Section 72 further
provides that a 10% penalty will apply to the income portion of any premature
distribution. The

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<PAGE>

penalty is not imposed on amounts received: (1) after the taxpayer reaches
59 1/2; (2) upon the death of the Contract Owner or Annuitant (as applicable);
(3) if the taxpayer is totally disabled; (4) in a series of substantially equal
periodic payments made for the life of the taxpayer or for the joint lives of
the taxpayer and his Beneficiary; (5) under an immediate annuity; or (6) which
are allocable to purchase payments made prior to August 14, 1982.

Separate tax withdrawal penalties and restrictions apply to Qualified Plan
Contracts.

DISTRIBUTION OF CONTRACTS

Contracts are sold by registered representatives of broker-dealers who are our
licensed insurance agents, either individually or through an incorporated
insurance agency. Commissions paid to broker-dealers may vary, but in the
aggregate are not anticipated to exceed 6% of all Purchase Payments (on a
present value basis). From time to time, additional sales incentives (up to 1%
of Purchase Payments) may be provided to broker-dealers maintaining certain
sales volume levels.

Lincoln Benefit Financial Services, Inc. ("LBFS") located at 206 South 13th
Street, Lincoln, Nebraska 68508 serves as distributor of the Contracts. LBFS
is a wholly-owned subsidiary of Lincoln Benefit Life Company. It is registered
as a broker-dealer under the Securities Exchange Act of 1934, as amended, and is
a member of the National Association of Securities Dealers, Inc.

LEGAL PROCEEDINGS

There are no pending legal proceedings affecting the Separate Account. The
Company and its subsidiaries are engaged in various kinds of routine litigation
which, in management's judgment, is not of material importance to their
respective total assets or material with respect to the Separate Account.

LEGAL MATTERS

Legal matters relating to the federal securities laws in connection with the
Contracts described herein are being passed upon by the law firm of Katten
Muchin & Zavis, 1025 Thomas Jefferson St., East Lobby-Suite 700, Washington,
D.C. 20007-5201.

REGISTRATION STATEMENT

A registration statement has been filed with the Securities and Exchange
Commission, Washington, D.C., under the Securities Act of 1933 as amended, with
respect to the Contracts offered by this prospectus. This prospectus does not
contain all the information set forth in the registration statement and the
exhibits filed as part of the registration statement, to all of which reference
is hereby made for further information concerning the Separate Account, the
Company, and the Contracts. Statements found in this prospectus as to the terms
of the Contracts and other legal instruments are summaries, and reference is
made to such instruments as filed.

FINANCIAL STATEMENTS

The financial statements for Lincoln Benefit Life Company and the Separate
Account are set forth in the Statement of Additional Information.

ADDITIONAL INFORMATION ABOUT
THE SEPARATE ACCOUNT

Additional information concerning the operations of the Separate Account is
contained in a Statement of Additional Information, which is available without
charge upon written request addressed to us. The contents of the Statement of
Additional Information are tabulated below.

TABLE OF CONTENTS
OF STATEMENT
OF ADDITIONAL INFORMATION

<TABLE>
<S> <C>
The Contract............................... 3
Annuity Payments...................... 3
Annuity Unit Value.................... 3
Variable Annuity Payments
--Illustrative Example................ 4
Additional Federal Income Tax Information.. 5
Diversification--Separate
Account Investments................... 5
Multiple Contracts.................... 6
Qualified Plans....................... 6
Separate Account Performance............... 7
Financial Statements....................... 12
</TABLE>

APPENDIX

PORTFOLIOS AND PERFORMANCE DATA

PERFORMANCE DATA

From time to time the Separate Account may advertise the Fidelity Money Market
Subaccount's "yield" and "effective yield." Both yield figures are based on
historical earnings and are not intended to indicate future performance. The
"yield" of the Fidelity Money Market Subaccount refers to the net income earned
by the Subaccount over a seven-day period (which period will be stated in the
advertisement). This income is then "annualized." That is, the amount of income
earned during that week is assumed to be generated each week over a 52-week
period and is shown as a percentage of the investment. The "effective yield" is
calculated similarly but, when annualized, the income earned by the investment
is assumed to be reinvested at the end of each seven-day period. The "effective
yield" will be slightly higher than the "yield" becasue of the compounding
effect of this assumed reinvestment. Neither the yield nor the effective yield
takes into consideration the effect of any capital changes that might have
occurred during the seven day period, nor do they reflect the impact of premium
taxes or any Withdrawal Charges. The impact of other, recurring charges on both
yield figures is, however, reflected in them to the same extent it would effect
the yield (or effective yield) for a Contract of average size.

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<PAGE>

In addition, the Separate Account may advertise an annualized 30-day (or one
month) yield figure for Subaccounts other than the Fidelity Money Market
Subaccount. These yield figures are based upon the actual performance of the
Subaccount over a 30-day (or one month) period ending on a date specified in the
advertisement. Like the total return data described above, the 30-day (or one
month) yield data will reflect the effect of all recurring Contract charges (but
will not reflect any Withdrawal charges or premium taxes). The yield figure is
derived from net investment gain (or loss) over the period expressed as a
fraction of the investment's value at the end of the period.

The Separate Account may also advertise standardized and non-standardized "total
return" data for its Subaccounts. Like the yield figures described above, total
return figures are based on historical data and are not intended to indicate
future performance. The standardized "total return" compares the value of a
hypothetical investment made at the beginning of the period, to the value of the
same hypothetical investment at the end of the period (asssuming the deduction
of any withdrawal charge imposed upon a complete redemption of the Contract at
the end of the period). Recurring Contract charges are reflected in the
standardized total return figures in the same manner as they are reflected in
the yield data for Contracts funded through the Money Market Subaccount. The
effect of applicable Withdrawal Charges are reflected in the standardized return
figures.

In addition to the standardized "total return," the Separate Account may
advertise non-standardized "total return." Non-standardized total return is
calculated in a similar manner and for the same time periods as the standardized
total return except that the Withdrawal Charge is not deducted. Further, an
initial hypothetical investment of $20,000 is assumed (rather than the initial
hypothetical investment of $1,000 used in computing standardized total return),
since $20,000 is closer to the average Purchase Payment of a Contract which we
expect to write.

The Separate Account may also disclose yield, standardized total return and non-
standardized total return for time periods before the date the Separate Account
commenced operations. In this case, performance data for the Subaccounts is
calculated based on the performance of the Underlying Funds and assumes that the
Subaccounts existed during the same time period as those of the Underlying
Funds, with recurring contract charges equal to those currently assessed against
the Subaccounts.

Advertisements we distribute may also compare the performance of our Subaccounts
with: (a) certain unmanaged market indices, including but not limited to the Dow
Jones Industrial Average, the Standard & Poor's 500, and the Shearson Lehman
Bond Index; and/or (b) other management investment companies with investment
objectives similar to the underlying funds being compared. This may include the
performance ranking assigned by various publications, including but not limited
to the Wall Street Journal, Forbes, Fortune, Money, Barron's, Business Week, USA
Today, and statistical services, including but not limited to Lipper Analytical
Services Mutual Fund Survey, Lipper Annuity and Closed End Survey, the Variable
Annuity Research Data Survey, and SEI.

For a more complete description of Contract charges, see "Contract Charges,"
beginning at Page 12. More detailed information on the computation of advertised
performance data for the Separate Account is contained in the Statement of
Additional Information.

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<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
-----------------------------------

FLEXIBLE PREMIUM INDIVIDUAL DEFERRED VARIABLE ANNUITY CONTRACTS

LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT

DEPOSITOR: LINCOLN BENEFIT LIFE COMPANY

This Statement of Additional Information is not a prospectus; it should be read
with the prospectus relating to the annuity contracts described above, a copy of
which may be obtained without charge by written request addressed to:

Lincoln Benefit Life Company
P.O. Box 82532
Lincoln, Nebraska 68501-2532

THE DATE OF THIS STATEMENT OF ADDITIONAL INFORMATION
AND OF THE RELATED PROSPECTUS IS: MAY 1, 1996.

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<PAGE>

TABLE OF CONTENTS

THE CONTRACT........................................................ 3

ANNUITY PAYMENTS............................................... 3

ANNUITY UNIT VALUE............................................. 3

VARIABLE ANNUITY PAYMENTS
- ILLUSTRATIVE EXAMPLE........................................ 4

ADDITIONAL FEDERAL INCOME TAX INFORMATION........................... 5

DIVERSIFICATION - SEPARATE ACCOUNT INVESTMENTS................. 5

MULTIPLE CONTRACTS............................................. 6

QUALIFIED PLANS................................................ 6

SEPARATE ACCOUNT PERFORMANCE........................................ 7

FINANCIAL STATEMENTS................................................ 12
</TABLE>

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<PAGE>

THE CONTRACT

ANNUITY PAYMENTS

INITIAL MONTHLY ANNUITY PAYMENT

The initial annuity payment is determined by applying the Contract Value on the
Valuation Date next preceding the Annuity Date, less any state premium tax
payable and any applicable Withdrawal Charges, to the annuity table specified in
the Contract (or, if more favorable to the payee, the annuity tables in effect
as of the Annuity Date for similar immediate annuity contracts issued by the
Company). Those tables are based on a set amount per $1,000 of proceeds
applied. The appropriate rate must be determined by the sex (except where, as
in the case of certain Qualified Plans and other employer-sponsored retirement
plans, such classification is not permitted) and age of the Annuitant and
designated second person, if any.

The dollars applied are then divided by 1,000 and the result multiplied by the
appropriate annuity factor appearing in the table to compute the amount of the
first monthly annuity payment. In the case of a Variable Annuity, that amount is
divided by the value of an Annuity Unit as of the Valuation Date next preceding
the Annuity Date to establish the number of Annuity Units representing each
Variable Annuity payment (a separate computation is made for each Subaccount
funding the Variable Annuity). The number of Annuity Units for each Subaccount
determined for the first Variable Annuity payment remains constant for the
second and subsequent monthly Variable Annuity payments from that Subaccount.

SUBSEQUENT MONTHLY PAYMENTS

For a Fixed Annuity, the amount of the second and each subsequent monthly
annuity payment is the same as that determined above for the first monthly
payment.

The amount of the second and each subsequent monthly Variable Annuity payment
from each Subaccount is determined by multiplying the number of Annuity Units,
as determined in connection with the determination of the initial monthly
payment, above, by the Annuity Unit Value of the Subaccount as of the Valuation
Period next preceding the date on which each annuity payment is due.

ANNUITY UNIT VALUE

The value of an Annuity Unit is determined independently for each Subaccount,
but was initially set at $100.00.

The annuity tables contained in the Contract are based on a 3.5% per annum
assumed investment rate. If the actual net investment rate experienced by a
Subaccount exceeds 3.5%, Variable Annuity payments derived from allocations to
that Subaccount will increase over time. Conversely, if the actual rate is less
than 3.5%, the Variable Annuity payments will decrease over time. If the net
investment rate equals 3.5%, the Variable Annuity payments will remain constant.
If a higher assumed investment rate had been used, the initial monthly payment
would be higher, but the actual net investment rate would also have to be higher
in order for annuity payments to increase (or not to decrease).

The payee receives the value of a fixed number of Annuity Units each month from
each Subaccount funding the Variable Annuity. The value of a fixed number of
Annuity Units will reflect the investment performance of the Subaccounts
elected, and the amount of each annuity payment will vary accordingly.

For each Subaccount, the value of an Annuity Unit for any Valuation Period is
determined by multiplying the Annuity Unit Value for the immediately preceding
Valuation Period by the Net Investment Factor for the Valuation Period for which
the Annuity Unit Value is being calculated. The result is then divided by a
second factor which offsets the effect of the assumed net investment rate of
3.5% per annum which is built into the annuity tables contained in the Contract.
The Net Investment Factor is described below.

NET INVESTMENT FACTOR

The Net Investment Factor is an index applied to measure the net investment
performance of a Subaccount from one Valuation Date to the next. The Net
Investment Factor may be greater or less than or equal to one; therefore, the
value of an Annuity Unit may increase, decrease or remain the same.

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<PAGE>

The Net Investment Factor for any Subaccount for any Valuation Period is
determined by dividing (a) by (b) and then subtracting (c) from the result
where:

(a) is the net result of:

(1) the net asset value of a Portfolio share held in the Subaccount
determined as of the Valuation Date at the end of the Valuation
Period, plus

(2) the per share amount of any dividend or other distribution
declared by the Portfolio if the "ex-dividend" date occurs during
the Valuation Period, plus or minus

(3) a per share credit or charge with respect to any taxes which we
paid or for which we reserved during the Valuation Period which
are determined by us to be attributable to the operation of the
Subaccount (no federal income taxes are applicable under present
law);

(b) is the net asset value of the Portfolio share held in the Subaccount
determined as of the Valuation Date at the end of the preceding
Valuation Period; and

(c) is the asset charge factor we determine for the Valuation Period to
reflect the charges for assuming the mortality and expense risks and
for the administrative expense charge.

ILLUSTRATIVE EXAMPLE

Assume that one share of a given Subaccount's underlying Portfolio had a net
asset value of $11.46 as of the close of the New York Stock Exchange ("NYSE") on
a Tuesday; that its net asset value had been $11.44 at the close of the NYSE on
Monday, the day before; and that no dividends or other distributions on that
share had been made during the intervening Valuation Period. The Net Investment
Factor for the Valuation Period (ending on Tuesday's close of the NYSE) is:

Net Investment Factor = ($11.46/$11.44) - 0.0000384 = 1.0017099

The amount subtracted from the ratio of the two net asset values (0.0000384) is
the daily equivalent of the annual asset charge against the Subaccount of 1.40%.

In the example given above, if the Annuity Unit value for the Subaccount was
$101.03523 on Monday, the Annuity Unit Value on Tuesday would have been:

$101.03523 x 1.0017099 = $101.19845
----------------------
1.0000943

VARIABLE ANNUITY PAYMENTS -- ILLUSTRATIVE EXAMPLE

Assume that a male Contract owner, P, owns a Contract in connection with which P
has allocated all of his Contract Value to a single Subaccount. P is also the
sole Annuitant and, at age 60, has elected to annuitize his Contract under
Option B, Life and 10 Years Certain. As of the last Valuation Date preceding
the Annuity Date, P's Account was credited with 7543.2456 Accumulation Units
each having a value of $15.432655. (i.e., P's Account Value at that Date is
equal to 7543.2456 x $15.432655 = $116,412.31). There are no premium taxes
payable upon annuitization and no Withdrawal Charges are applicable. Assume
also that the Annuity Unit value for the Subaccount at that same Date is
$132.56932, and that the Annuity Unit value on the Valuation Date immediately
prior to the second annuity payment date is $133.27695.

P's first Variable Annuity payment is determined from the annuity rate tables in
P's Contract, using the information assumed above. From the tables, which
supply monthly annuity payments for each $1,000 of applied Contract Value, P's
first Variable Annuity payment is determined by multiplying the monthly
installment of $5.44 by the result of dividing P's Account Value by $1,000:

First Payment = $5.44 x ($116,412.31/$1,000) = $633.28

The number of P's Annuity Units is also determined at this time and is equal to
the amount of the first Variable Annuity payment divided by the value of an
Annuity Unit at the Valuation Date immediately prior to annuitization:

4
<PAGE>

Annuity Units = $633.28 / $132.56932 = 4.77697

P's second Variable Annuity payment is determined by multiplying the number of
Annuity Units by the Annuity Unit value as of the Valuation Date immediately
prior to the second payment due date:

Second Payment = 4.77697 x $133.27695 = $636.66

The third and subsequent Variable Annuity payments are computed in a manner
similar to the second Variable Annuity payment.

Note that the amount of the first Variable Annuity payment depends on the
Contract Value in the relevant Subaccount on the Annuity Date and thus reflects
the investment performance of the Subaccount net of fees and charges during the
Accumulation Period. The amount of that payment determines the number of Annuity
Units, which will remain constant during the Annuity Period. The net investment
performance of the Subaccount during the Annuity Period is reflected in
continuing changes during that Period in the Annuity Unit value, which
determines the amounts of the second and subsequent Variable Annuity payments.

ADDITIONAL FEDERAL INCOME TAX INFORMATION

DIVERSIFICATION - SEPARATE ACCOUNT INVESTMENTS

Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not adequately
diversified, in accordance with regulations prescribed by the United States
Treasury Department ("Treasury Department"). Disqualification of the Contract
as an annuity contract would result in imposition of federal income tax to the
Contract Owner with respect to earnings allocable to the Contract prior to the
receipt of payments under the Contract. The Code contains a safe harbor
provision which provides that annuity contracts such as the Contracts meet the
diversification requirements if, as of the close of each quarter, the underlying
assets meet the diversification standards for a regulated investment company,
and no more than 55% of the total assets consist of cash, cash items, U.S.
Government securities and securities of other regulated investment companies.
For purposes of determining whether or not the diversification standards imposed
on the underlying assets of variable contracts by Section 817(h) of the Code
have been met, each United States government agency or instrumentality is
treated as a separate issuer.

The Treasury Department has issued Regulations that establish diversification
requirements for the investment accounts underlying variable contracts such as
the Contracts. The Regulations amplify the diversification requirements for
variable contracts set forth in the Code and provide an alternative to the safe
harbor provision described above. Under the Regulations, an investment account
will be deemed adequately diversified if (1) no more than 55% of the value of
the total assets of the account is represented by any one investment; (2) no
more than 70% of the value of the total assets of the account is represented by
any two investments; (3) no more than 80% of the value of the total assets of
the account is represented by any three investments; and (4) no more than 90% of
the value of the total assets of the account is represented by any four
investments. These diversification standards are applied to each Subaccount of
the Separate Account by applying them to the investments of the Portfolio
underlying the Subaccount.

The Company intends that each of the Portfolios will be managed by its
respective investment adviser in such a manner as to comply with these
diversification requirements.

In connection with the issuance of the regulations on diversification
requirements, the Treasury announced that such regulations do not provide
guidance concerning the extent to which Owners may direct their investments
among Subaccounts of a Variable Account. The Internal Revenue Service has
previously stated in published rulings that a variable contract owner will be
considered the owner of separate account assets if the owner possesses incidents
of ownership in those assets such as the ability to exercise investment control
over the assets. At the time of the issuance of the diversification
regulations, the Treasury announced that guidance would be issued in the future
on the extent to which owners could direct their investments among subaccounts
without being treated as owners of the underlying assets of the Variable
Account. As of the date of this prospectus, no such guidance has been issued.
It is possible that the Treasury's position, when

5
<PAGE>

announced, may adversely affect the tax treatment of existing contracts. The
Company, therefore, reserves the right to modify the contract as necessary to
attempt to prevent the Owner from being considered the owner of the assets of
the Variable Account or otherwise to attempt to qualify the contract for
favorable tax treatment.

MULTIPLE CONTRACTS

Federal tax law provides that multiple annuity contracts which are issued within
a calendar year to the same contract owner by one company or its affiliates are
treated as one annuity contract for purposes of determining the tax consequences
of any distribution. Such treatment may result in adverse tax consequences
including more rapid taxation of the distributed amounts from such multiple
contracts. Contract Owners should consult a tax adviser prior to purchasing
more than one annuity contract in any calendar year.

QUALIFIED PLANS

The Contracts offered by this prospectus are designed to be suitable for use
under various types of Qualified Plans. Taxation of Contract Owners in
Qualified Plans varies with the type of plan and terms and conditions of each
specific plan. Contract Owners, Annuitants and Beneficiaries are cautioned that
benefits under a Qualified Plan may be subject to the terms and conditions of
the Plan, regardless of the terms and conditions of the Contracts issued
pursuant to the plan.

Following are general descriptions of the types of Qualified Plans with which
the Contracts may be used. Such descriptions are not exhaustive and are for
general information purposes only. The tax rules regarding Qualified Plans are
very complex and will have differing applications depending on individual facts
and circumstances. Each purchaser should obtain competent tax advice prior to
purchasing a Contract issued under a Qualified Plan.

Contracts issued pursuant to Qualified Plans include special provisions
restricting Contract provisions that may otherwise be available and described in
this prospectus. Generally, Contracts issued pursuant to Qualified Plans are
not transferable except upon surrender or annuitization. Various penalty and
excise taxes may apply to contributions or distributions made in violation of
applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from Contracts issued under Qualified
Plans.

(A) H.R. 10 PLANS

Section 401 of the Code permits self-employed individuals to establish
Qualified Plans for themselves and their employees, commonly referred to as
"H.R. 10" or "Keogh" Plans. Contributions made to the Plan for the benefit
of the employees will not be included in the gross income of the employees
until distributed from the Plan. The tax consequences to employers may
vary depending upon the particular Plan design. However, the Code places
limitations and restrictions on all Plans on such items as: amounts of
allowable contributions; form, manner and timing of distributions; vesting
and nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders. Purchasers of Contracts for use with an H.R. 10 Plan should
obtain competent tax advise as to the tax treatment and suitability of such
an investment.

(B) TAX-SHELTERED ANNUITIES

Section 403(b) of the Code permits the purchase of "Tax-Sheltered
Annuities" by public schools and certain charitable, educational and
scientific organizations described in Section 501(c)(3) of the Code. These
qualifying employers may make contributions to the Contracts for the
benefit of their employees. Such contributions are not includible in the
gross income of the employee until the employee receives distributions from
the Contract. The amount of contributions to the Tax-Sheltered Annuity is
limited to certain maximums imposed by the Code. Furthermore, the Code sets
forth additional restrictions governing such items as transferability,
distributions, nondiscrimination and withdrawals. Any employee should
obtain competent tax advice as to the tax treatment and suitability of such
an investment.

6
<PAGE>

Section 408(b) of the Code permits eligible individuals to contribute to an
individual retirement program known as an "Individual Retirement Annuity"
("IRA"). Under applicable limitations, certain amounts may be contributed
to an IRA which will be deductible from the individual's gross income.
These IRAs are subject to limitations on eligibility, contributions,
transferability and distributions. Sales of Contracts for use with IRAs
are subject to special requirements imposed by the Code, including the
requirement that certain informational disclosure be given to persons
desiring to establish an IRA. Purchasers of Contracts to be qualified as
IRAs should obtain competent tax advice as to the tax treatment and
suitability of such an investment.

(D) CORPORATE PENSION AND PROFIT-SHARING PLANS

Sections 401(a) and 401(k) of the Code permit corporate employers to
establish various types of retirement plans for employees. These
retirement plans may permit the purchase of the Contracts to provide
benefits under the plan. Contributions to the plan for the benefit of
employees will not be includible in the gross income of the employee until
distributed from the plan. The tax consequences to employers may vary
depending upon the particular plan design. However, the Code places
limitations on all plans on such items as amount of allowable
contributions; form, manner and timing of distributions; vesting and
nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders. Purchasers of Contracts for use with corporate pension or
profit sharing plans should obtain competent tax advice as to the tax
treatment and suitability of such an investment.

(E) DEFERRED COMPENSATION PLANS - SECTION 457

Section 457 of the Code, while not actually providing for a Qualified Plan
as that term is normally used, provides that governmental and certain other
tax exempt employers may establish deferred compensation plans for the
benefit of their employees which may invest in annuity contracts. The
Code, as in the case of Qualified Plans, establishes limitations and
restrictions on eligibility, contributions, and distributions. Under these
plans, contributions made for the benefit of the employees will not be
includible in the employees' gross income until distributed from the plan.
However, under a 457 plan all the compensation deferred under the plan must
remain solely the property of the employer, subject only to the claims of
the employer's general creditors, until such time as made available to an
employee or a beneficiary.

SEPARATE ACCOUNT PERFORMANCE

Performance data for the various Subaccounts are computed in the manner
described below.

FIDELITY MONEY MARKET SUBACCOUNT

Current yield is computed by first determining the Base Period Return
attributable to a hypothetical Contract having a balance of one Accumulation
Unit at the beginning of a 7 day period using the formula:

Base Period Return = (EV-SV)/(SV)

where:

SV = value of one Accumulation Unit at the start of a 7 day period
EV = value of one Accumulation Unit at the end of the 7 day period

The value of the Accumulation Unit at the end of the period (EV) is determined
by (1) adding, to the value of the Unit at the beginning of the period (SV), the
investment income from the underlying Variable Insurance Products Fund Money
Market Portfolio attributed to the Unit over the period, and (2) subtracting,
from the result, the sum of (a) the portion of the annual Mortality and Expense
Risk and Administrative Expense Charges allocable to the 7 day period (obtained
by multiplying the annually-based charges by the fraction 7/365), and (b) a
prorated portion of the annual Contract Administration Charge of $25 per
contract. The total Contract Administration Charge is allocated between the
Subaccounts in proportion to the

7
<PAGE>

respective Contract Values similarly allocated. The Charge is further reduced,
for purposes of the yield computation, by multiplying it by the ratio that the
value of the hypothetical Contract bears to the value of an account of average
size for Contracts funded by the Fidelity Money Market Subaccount. Finally, as
is done with the other charges discussed above, the result is multiplied by the
fraction 7/365 to arrive at the portion attributable to the 7 day period. The
current yield is then obtained by annualizing the Base Period Return:

Current Yield = (Base Period Return) x (365/7)

The Fidelity Money Market Subaccount also quotes an "effective yield" that
differs from the current yield given above in that it takes into account the
effect of dividend reinvestment in the Variable Insurance Products Fund Money
Market Portfolio. The effective yield, like the current yield, is derived from
the Base Period Return over a 7 day period. However, the effective yield
accounts for dividend reinvestment by compounding the current yield according to
the formula:

365/7-
Effective Yield = [(Base Period Return + 1) 1].

Net investment income for yield quotation purposes will not include either
realized capital gains and losses or unrealized appreciation and depreciation,
whether reinvested or not. The yield quotations also do not reflect any impact
of premium taxes, transfer fees, or Withdrawal Charges.

The yields quoted should not be considered a representation of the yield of the
Fidelity Money Market Subaccount in the future since the yield is not fixed.
Actual yields will depend not only on the type, quality and maturities of the
investments held by the Variable Insurance Products Fund Money Market Portfolio
and changes in interest rates on such investments, but also on factors such as a
Contract Owner's account size (since the impact of fixed dollar charges will be
greater for small accounts than for larger accounts).

Yield information may be useful in reviewing the performance of the Fidelity
Money Market Subaccount and for providing a basis for comparison with other
investment alternatives. However, the Fidelity Money Market Subaccount's yield
fluctuates, unlike bank deposits or other investments that typically pay a fixed
yield for a stated period of time.

OTHER SUBACCOUNTS

Subaccounts of the Separate Account other than the Money Market Subaccount
compute their performance data in terms of an annualized "yield" and/or as
"total return".

Yield

Yield will be expressed as an annualized percentage derived from the
Subaccount's performance over a stated 30-day (or one month) period. Like the
yield figures for the Fidelity Money Market Subaccount, the 30-day (or one
month) annualized yield figures will reflect all recurring Contract charges and
will not reflect Withdrawal Charges, transfer fees or premium taxes. To arrive
at the yield percentage over the 30-day (or one month) period, the net income
per Accumulation Unit of the Subaccount during the period is divided by the
value of an Accumulation Unit as of the end of the period. The yield figure is
then annualized by assuming monthly compounding of the 30-day (or one month)
figure over a six month period and then doubling the result.

The formula used in computing the yield figure is:

6
Yield = 2 ( ((a-b) + 1) - 1)
-----
cd

where:

a = net investment income earned during the period by the underlying
Portfolio attributable to its shares held in the Subaccount;
b = expenses accrued for the period (net of reimbursements);
c = average daily number of Accumulation Units outstanding during the
period; and
d = the net asset value of an Accumulation Unit on the last day of the
period.

8
<PAGE>

The yield figures for the Subaccounts other than the Fidelity Money Market
Subaccount reflect all recurring Contract charges, as described in the
explanation of the yield computation for the Fidelity Money Market Subaccount.
Like the Fidelity Money Market Subaccount's yield figures, the yield figures for
the other Subaccounts are derived from past performance and should not be taken
as predictive of future results.

Standardized Total Return

Standardized total return for a Subaccount represents a single computed annual
rate of return that, when compounded annually over a specified time period (one,
five, and ten years, or since inception) and applied to a hypothetical initial
investment in a Contract funded by that Subaccount made at the beginning of the
period, will produce the same Contract Value at the end of the period that the
hypothetical investment would have produced over the same period. The
standardized total rate of return (T) is computed so that it satisfies the
formula:

n
P(1+T) = ERV

where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the one, five, or ten year period as of
the end of the period (or fractional portion thereof).

The standardized total return figures reflect the effect of both non-recurring
and recurring charges, as discussed herein. Recurring charges are taken into
account in a manner similar to that used for the yield computations for the
Fidelity Money Market Subaccount, described above. The applicable Withdrawal
Charge (if any) is deducted as of the end of the period, to reflect the effect
of the assumed complete redemption. Because the impact of Contract
Administration Charges on a particular Contract Owner's account will generally
differ from that assumed in the computation, due to differences between most
actual allocations and the assumed one, as well as differences due to varying
account sizes, the total return experienced by an actual Subaccount over the
same time periods would generally have been different from those produced by the
computation. As with the Fidelity Money Market and other Subaccount yield
figures, standardized total return figures are derived from historical data and
are not intended to be a projection of future performance.

Non-Standardized Total Return

Non-standardized total return for a Subaccount represents a single computed
annual rate of return that, when compounded annually over a specified time
period (one, five, and ten years, or since inception) and applied to a
hypothetical initial investment in a Contract funded by that Subaccount made at
the beginning of the period, will produce the same Contract Value at the end of
the period that the hypothetical investment would have produced over the same
period. The total rate of return (T) is computed so that it satisfies the
formula:

n
P(1+T) = ERV

where: P = a hypothetical initial payment of $20,000
T = average annual total return
n = number of years

ERV = ending redeemable value of a hypothetical $20,000 payment made
at the beginning of the one, five, or ten year period as of the
end of the period (or fractional portion thereof).

An initial hypothetical investment of $20,000 is assumed (rather than the
initial hypothetical investment of $1,000 used in computing standardized total
return) since $20,000 is closer to the average Purchase Payment of a Contract
which we expect to write. The non-standardized total return figures reflect the
effect of recurring charges, as discussed herein. Because the impact of
Contract Administration Charges on a particular Contract Owner's account will
generally differ from that assumed in the computation, due to differences
between most actual allocations and the assumed one, as well as differences due
to varying account sizes, the total return experienced by the actual Subaccount
over the same time periods would generally have been different from those
produced by the computation. As with the standardized total return figures,
non-standardized total return figures are derived from historical data and are
not intended to be a projection of future performance.

9
<PAGE>

Time Periods Before the Date the Separate Account Commenced Operations

TOTAL RETURN -- AS OF DECEMBER 31, 1995 -- ASSUMING CONTRACT SURRENDERED
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN/3/
--------------------------------------------------------------------
1 Year 5 Year 10 Years Since Inception
--------------------------------------------------------------------
Inception Date/2/ % % % %
-------------- --------------------------------------------------------------------

<S> <C> <C> <C> <C> <C>
FIDELITY
Money Market/1/ 4/1/82 n/a n/a n/a n/a
Growth 10/9/86 30.36 18.65 n/a 13.17
Equity-Income 10/9/86 29.66 19.14 n/a 11.57
Overseas 1/28/87 3.96 6.03 n/a 7.21
Asset Manager 9/6/89 10.72 10.56 n/a 9.59
Contrafund 1/3/95 n/a n/a n/a n/a

SCUDDER
Bond 7/16/85 26.36 10.16 8.27 8.16
Balanced 7/16/85 31.26 12.28 9.93 9.97

JANUS
Flexible Income 9/13/93 14.81 n/a n/a 5.37
Balanced 9/13/93 15.98 n/a n/a 7.49
Growth 9/13/93 21.32 n/a n/a 10.00
Aggressive Growth 9/13/93 19.73 n/a n/a 17.36
Worldwide Growth 9/13/93 18.78 n/a n/a 10.41

FEDERATED
High Income Bond Fund II 3/1/94 11.20 n/a n/a 3.20
Utility Fund II 2/11/94 14.75 n/a n/a 3.38
U.S. Gov't. Securities II 3/28/94 0.20 n/a n/a 0.87

INVESTMENT ADVISERS, INC. (IAI)
Regional 1/31/94 24.39 n/a n/a 12.80
Reserve 4/7/94 -3.26 n/a n/a -1.26
Balanced 2/3/94 7.39 n/a n/a 3.51
</TABLE>

1 An investment in Fidelity Money Market is neither insured nor guaranteed by
the U.S. Government and there can be no assurance that Fidelity Money Market
will maintain a stable $1.00 share price.

2 Some of the underlying investment options were active before January 2,
1994, the effective date of the Investor's Select Separate Account. Where
applicable, performance includes hypothetical performance for periods before the
investment option was available in Investor's Select, applying contract charges
assessed at the Separate Account level to approximate the performance the
investment option would have achieved inside the Separate Account.

3 Total returns include change in share price, reinvestment of dividends, and
capital gains. The performance figures: (1) represent past performance and
neither guarantee nor predict future investment results; (2) assume an initial
hypothetical investment of $1,000 as required by the Securities and Exchange
Commission (SEC); and (3) reflect the deduction of 1.4% annual asset charges, a
$25 annual contract administration charge, and a maximum 7% contingent deferred
sales charge (declining after two years). The investment return and value of an
Investor's Select contract will fluctuate so that a contract, when surrendered,
may be worth more or less than the amount of its purchase payments.

n/a- Performance data has not been available for some investment options for
the full 1, 5, or 10 year periods (see Inception Date). Investment options with
a 9/13/93 inception date or later will not have meaningful performance to report
for many of the periods indicated.

10
<PAGE>

TOTAL RETURN -- AS OF DECEMBER 31, 1995 -- ASSUMING CONTRACT NOT SURRENDERED
---
<TABLE>
<CAPTION>

---------------------------------------
AVERAGE ANNUAL RETURN/5/
---------------------------------------
INVESTMENT OPTIONS Inception Monthly Return/5/ Total Return YTD/5/ 1 Year 5 Year Since Inception
Date/4/ % % % % %
---------- ----------------- ------------------- ---------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FIDELITY
Money Market/1/ 4/1/82 n/a n/a n/a n/a n/a
Growth 10/9/86 -3.24 33.32 33.34 18.95 13.17
Equity-Income 10/9/86 2.80 33.02 33.05 19.49 11.57
Overseas 1/28/87 2.83 8.02 8.02 6.49 7.21
Asset Manager 9/6/89 2.40 15.18 15.19 11.05 9.79
Contrafund 1/3/95 n/a n/a n/a n/a n/a
SCUDDER
Bond 7/16/85 1.57 30.35 30.38 10.56 8.16
Balanced 7/16/85 0.33 34.73 34.76 12.62 9.97
JANUS
Flexible Income/2/ 9/13/93 2.02 21.99 22.01 n/a 7.78
Balanced 9/13/93 2.21 22.90 22.92 n/a 9.83
Growth 9/13/93 1.36 28.18 28.20 n/a 12.28
Aggressive Growth 9/13/93 5.21 25.56 25.57 n/a 19.46
Worldwide Growth 9/13/93 4.64 25.44 25.46 n/a 12.68
FEDERATED
High Income Bond II/3/ 3/1/94 1.52 18.53 18.55 n/a 6.87
Utility Fund II/3/ 2/11/94 3.42 22.28 22.30 n/a 6.94
U.S. Gov't. Securities II/3/ 3/28/94 0.98 7.11 7.11 n/a 4.76
INVESTMENT ADVISERS, INC. (IAI)
Regional 1/31/94 3.22 31.29 31.31 n/a 16.03
Reserve 4/7/94 0.24 3.67 3.67 n/a 2.75
Balanced 2/3/94 -0.72 14.42 14.43 n/a 7.01
</TABLE>

-------------------------------------
Cumulative SEC 7-Day SEC CALENDAR YEAR RETURN/5/
Total Return Effective 7-Day -------------------------------------
INVESTMENT OPTIONS Inception/4/ Monthly Return/5/ Yield Yield 1992 1993 1994
Date % % % % % %
------------- ----------------- --------- ------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FIDELITY
Money Market/1/ 4/1/82 n/a n/a n/a n/a n/a n/a
Growth 10/9/86 213.08 7.67 17.56 -1.52
Equity-Income 10/9/86 174.62 15.12 16.50 5.44
Overseas 1/28/87 86.09 -12.07 35.27 0.20
Asset Manager 9/6/89 80.34 10.02 19.40 -7.52
Contrafund 1/3/95 n/a n/a n/a n/a
SCUDDER
Bond 7/16/85 127.23 5.39 10.68 -6.23
Balanced 7/16/85 170.17 5.34 5.82 -3.53
JANUS
Flexible Income/2/ 9/13/93 18.77 n/a n/a -2.40
Balanced 9/13/93 24.04 n/a n/a -0.70
Growth 9/13/93 30.48 n/a n/a 1.21
Aggressive Growth 9/13/93 50.45 n/a n/a 14.56
Worldwide Growth 9/13/93 31.54 n/a n/a -0.01
FEDERATED
High Income Bond II/3/ 3/1/94 12.96 n/a n/a n/a
Utility Fund II/3/ 2/11/94 13.47 n/a n/a n/a
U.S. Gov't. Securities II/3/ 3/28/94 8.54 n/a n/a n/a
INVESTMENT ADVISERS, INC. (IAI)
Regional 1/31/94 32.92 n/a n/a n/a
Reserve 4/7/94 4.82 n/a n/a n/a
Balanced 2/3/94 13.79 n/a n/a n/a
</TABLE>

The performance figures represent past performance and neither guarantee nor
predict future investment results.

1 An investment in Fidelity Money Market is neither insured nor guaranteed
by the U.S. Government and there can be no assurance that Fidelity Money Market
will maintain a stable $1.00 share price.

2, 3 Total returns reflect the investment adviser waived all or part of its fee
or reimbursed the investment options for a portion of its expenses. Otherwise,
total returns would have been lower.

4 Some of the underlying investment options were active before January 2,
1994, the effective date of the Investor's Select Separate Account. Where
applicable, performance includes hypothetical performance for periods before the
investment option was available in Investor's Select, applying contract charges
assessed at the Separate Account level to approximate the performance the
investment option would have achieved inside the Separate Account.

5 Total returns include change in share price, reinvestment of dividends,
and capital gains. An initial hypothetical investment of $20,000 is assumed
since this is closer to the average purchase payment of a contract expected to
be written than the $1,000 assumed for SEC required returns shown on page 10.
Returns reflect deductions of 1.4% annual asset charges and a $25.00 annual
contract administration charge, but do not include the applicable contingent
deferred sales charge. The impact of the annual contract administration charge
on investment returns will vary depending on the size of the contract.

n/a- Performance data is not available for all or part of the period indicated
(see Inception Date). Investment options with a 9/13/93 inception date or later
will not have meaningful performance to report for the periods indicated.

<PAGE>

FINANCIAL STATEMENTS*

The financial statements of the Separate Account and for Lincoln Benefit Life
Company appearing in this Statement of Additional Information have been audited
by Deloitte & Touche LLP, independent certified public accountants, as stated in
their reports. Such financial statements have been included herein in reliance
upon the reports of Deloitte & Touche LLP. The Company's financial statements
should be considered only as bearing upon the ability of Lincoln Benefit Life
Company to meet its obligations under the Contracts. The amounts of the Variable
Annuity payments under a Contract are not dependent upon the financial condition
of Lincoln Benefit Life Company and are not guaranteed by Lincoln Benefit Life
Company.

*To be filed by post-effective amendment.

12
<PAGE>

PART C
------

OTHER INFORMATION
-----------------

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements
- --- --------------------

The following financial statements are included in Part A of the
Registration Statement:

None

The following financial statements are included in Part B of the
Registration Statement:

The following financial statements are included in Part C of the
Registration Statement:

None
<TABLE>
<CAPTION>

(b) Exhibits
- --- --------
<C> <S> <C>
(1) Resolution Establishing Separate Account......... *
(2) Custody Agreements............................... Not Applicable
(3) (a) Form of Underwriting Agreement............... *
(b) Form of Selling Agreement.................... *
(4) Variable Annuity Contract........................ *
(5) Application for Contract......................... *
(6) Depositor - Corporate Documents
(a) Articles of Incorporation.................... *
(b) By-Laws...................................... *
(7) Reinsurance Contract............................. *
(8) Forms of Fund Participation Agreement:
(a) Janus Aspen Series........................... *
(b) Variable Insurance Products Fund............. *
(c) Variable Insurance Products Fund II.......... *
(d) IAI Retirement Funds, Inc.................... *
(e) Federated Insurance Fund Management Series... *
(f) Scudder Variable Life Investment Fund........ *
(9) Opinion of Counsel............................... *
(10) Consent of Independent Accountant................ **
(11) Financial Statements Omitted from Item 23........ Not Applicable
(12) Initial Capitalization Agreement................. *
(13) Performance Computations......................... Herewith
</TABLE>
* Previously Filed
** To be filed by post-effective amendment

A
<PAGE>

ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR

The directors and principal officers of Lincoln Benefit Life Company are
listed below. Their principal business address is 206 South 13th Street,
Lincoln, Nebraska 6508.
<TABLE>
<CAPTION>
NAME POSITION/OFFICE WITH DEPOSITOR
---- ------------------------------
<C> <S>
Louis G. Lower, III Chairman of the Board of Directors and
Chief Executive Officer
Fred H. Jonske Director, President and Chief Operating Officer
Douglas F. Gaer Director, Senior Vice President
Janet P. Anderbery Vice President and Controller
Peter H. Heckman Director
William F. Krueger Director and Senior Vice President
John J. Morris Director, Senior Vice President and Secretary
Lawrence Pollock Director
Robert E. Rich Director, Senior Vice President, Treasurer
and Assistant Secretary
Theodore A. Schnell Director
Stephen W. Sutton Director and Senior Vice President
Michael J. Velotta Director
Carol S. Watson Director, Senior Vice President
and General Counsel
B. Eugene Wraith Director, and Senior Vice President
Thomas J. Berney Vice President
John H. Coleman III Vice President
Marvin P. Ehly Vice President
Kenny L. Gettman Vice President
Georgia G. Feiste Vice President
Theodore J. Kooser Vice President
Shirley A. Overly Vice President
Dean M. Way Vice President
</TABLE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH DEPOSITOR OR
REGISTRANT

See 10-K Commission File #1-11840, The Allstate Corporation

ITEM 27. NUMBER OF CONTRACT OWNERS

As of February 14, 1996, the Registrant has 2,015 qualified contract owners
and 1,552 non-qualified contract owners.

ITEM 28. INDEMNIFICATION

The Articles of Incorporation of Lincoln Benefit Life Company (Depositor)
provide for the indemnification of its directors and officers against
expenses, judgments, fines and amounts paid in settlement as incurred by
such person, so long as such person shall not have been adjudged to be
liable for negligence or misconduct in the performance of a duty to the
Company. This right of indemnity is not exclusive of other rights to which
a director or officer may otherwise be entitled.

B
<PAGE>

The by-laws of Lincoln Benefit Financial Services, Inc. (Distributor)
provide that the corporation will indemnify a director, officer, employee
or agent of the corporation to the full extent of Delaware law. In
general, Delaware law provides that a corporation may indemnify a director,
officer, employee or agent against expenses, judgments, fines and amounts
paid in settlement if that individual acted in good faith and in a manner
he or she reasonably believed to be in or not opposed to the best interests
of the corporation, and with respect to any criminal action or proceeding,
had no reasonable cause to believe his or her conduct was unlawful. No
indemnification shall be made for expenses, including attorney's fees, if
the person shall have been judged to be liable to the corporation unless a
court determines such person is entitled to such indemnity. Expenses
incurred by such individual in defending any action or proceeding may be
advanced by the corporation so long as the individual agrees to repay the
corporation if it is later determined that he or she is not entitled to
such indemnification.

Under the terms of the form of Underwriting Agreement, the Depositor agrees
to indemnify the Distributor for any liability that the latter may incur to
a Contract owner or party-in-interest under a Contract, (a) arising out of
any act or omission in the course of or in connection with rendering
services under such Agreement, or (b) arising out of the purchase,
retention or surrender of a Contract; provided, that the Depositor will not
indemnify the Distributor for any such liability that results from the
latter's willful misfeasance, bad faith or gross negligence, or from the
reckless disregard by the latter of its duties and obligations under the
Underwriting Agreement.

Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the forgoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

C
<PAGE>

ITEM 29. PRINCIPAL UNDERWRITER
- -------------------------------

Lincoln Benefit Financial Services, Inc. serves as distributor for the
Registrant. The following are the directors and officers of Lincoln Benefit
Financial Services, Inc. Their principal business address is 206 South 13th
Street, Lincoln, Nebraska 68508.

NAME POSITION WITH DISTRIBUTOR
---- -------------------------

Fred H. Jonske Director and Chairman
Janet P. Anderbery Vice President & Controller
David A. Behrens Vice President
Douglas F. Gaer Director
William F. Krueger Director and Vice President
John J. Morris Director, Vice President and Secretary
Robert E. Rich Director
Carol S. Watson Director, Vice President-Compliance
and General Counsel
B. Eugene Wraith Director and President

The following commissions and other compensation were received by each
principal underwriter, directly or indirectly, from the Registrant during
the Registrant's last fiscal year:

<TABLE>
<CAPTION>
NET
UNDERWRITING
DISCOUNTS COMPENSATION
Name of AND ON BROKERAGE
Principal Underwriter COMMISSIONS Redemption COMMISSIONS COMPENSATION
------------------------- ------------- -------------- ------------ --------------
<S> <C> <C> <C> <C>
Lincoln Benefit Financial
Services, Inc. $4,596,381
</TABLE>

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
- ------------------------------------------

The Depositor, Lincoln Benefit Life Company, is located at 206 South 13th
South 13th Street, Lincoln, Nebraska 68508.

The Distributor, Lincoln Benefit Financial Services, Inc., is located at
134 South 13th Street, Lincoln, Nebraska 68508.

Each company maintains those accounts and records required to be maintained
pursuant to Section 31(a) of the Investment Company Act and the rules
promulgated thereunder.

ITEM 31. MANAGEMENT SERVICES
- -----------------------------

None.

D
<PAGE>

ITEM 32. UNDERTAKINGS
- ----------------------

Registrant undertakes (1) to file post-effective amendments to this
Registration Statement as frequently as is necessary to ensure that the
audited financial statements in the Registration Statement are never more
than 16 months old for so long as payments under the variable annuity
contracts may be accepted; (2) to include either (A) as part of any
application to purchase a Contract offered by the prospectus forming part
of this Registration Statement, a space that an applicant can check to
request a Statement of Additional Information, or (B) a post card or
similar written communication affixed to or included in the prospectus that
the applicant can remove to send for a Statement of Additional Information,
and (3) to deliver any Statement of Additional Information and any
financial statements required to be made available under this Form N-4
promptly upon written or oral request.

REPRESENTATIONS
- ---------------

The Company hereby represents that it is relying upon a No Action Letter
issued to the American Council of Life Insurance dated November 28, 1988
(Commission ref. IP-6-88) and that the following provisions have been
complied with:

1. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in each registration statement,
including the prospectus, used in connection with the offer of the
contract;

2. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in any sales literature used in
connection with the offer of the contract;

3. Instruct sales representatives who solicit participants to purchase
the contract specifically to bring the redemption restrictions imposed
by Section 403(b)(11) to the attention of the potential participants;

4. Obtain from each plan participant who purchases a Section 403(b)
annuity contract, prior to or at the time of such purchase, a signed
statement acknowledging the participant's understanding of (a) the
restrictions on redemption imposed by Section 403(b)(11), and (2)
other investment alternatives available under the employer's Section
403(b) arrangement to which the participant may elect to transfer his
contract value.

E
<PAGE>

SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant has caused this Post-Effective Amendment to the
Registration Statement to be signed on its behalf, in the City of Lincoln, and
the State of Nebraska, on this 28th day of February, 1996.

LINCOLN BENEFIT LIFE VARIABLE
ANNUITY ACCOUNT
(Registrant)

By: LINCOLN BENEFIT LIFE COMPANY
(Depositor)

By: /s/ Fred H. Jonske
-------------------------------
Fred H. Jonske, President and
Chief Operating Officer

As required by the Securities Act of 1933, this Post-Effective Amendment to
the Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:

SIGNATURE TITLE DATE
--------- ----- ----

/s/ Fred H. Jonske President, Chief Operating February 28, 1996
- ----------------------- Officer and Director -----------------
Fred H. Jonske (Principal Executive Officer)

/s/ Robert E. Rich Senior Vice President February 28, 1996
- ----------------------- Chief Actuary, Treasurer -----------------
Robert E. Rich and Director
(Principal Financial Officer)

/s/ Janet P. Anderbery Vice President and February 28, 1996
- ----------------------- Controller (Principal -----------------
Janet P. Anderbery Accounting Officer)

- ----------------------- Director
Peter H. Heckman -----------------

/s/ William F. Krueger Director February 28, 1996
- ----------------------- -----------------
William F. Krueger
<PAGE>

SIGNATURE TITLE DATE
--------- ----- ----

- ----------------------- Director -----------------
Louis G. Lower, II

/s/ John J. Morris Director February 28, 1996
- ----------------------- -----------------
John J. Morris

- ----------------------- Director -----------------
Lawrence Pollock

/s/ Douglas F. Gaer Director February 28, 1996
- ----------------------- -----------------
Douglas F. Gaer

- ----------------------- Director -----------------
Theodore A. Schnell

/s/ Stephen W. Sutton Director February 28, 1996
- ----------------------- -----------------
Stephen W. Sutton

- ----------------------- Director -----------------
Michael J. Velotta

/s/ Carol S. Watson Director February 28, 1996
- ----------------------- -----------------
Carol S. Watson

/s/ B. Eugene Wraith Director February 28, 1996
- ----------------------- -----------------
B. Eugene Wraith
<PAGE>

INDEX TO EXHIBITS

FOR

REGISTRATION STATEMENT ON FORM N-4

LINCOLN BENEFIT LIFE VARIABLE ANNUITY ACCOUNT

EXHIBIT NO. SEQUENTIAL PAGE NO.
- ----------- -------------------

(13) Performance Computations

<PAGE>

Exhibit (13)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Janus
Flexible
Income

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.637075 0.129707
31-Dec-95 1.25 11.77092 0.106194

Resulting Value 31-Dec-95 11.77092 99.7641 1174.315

1104.315
annualized 5.29%
cumulative 10.43%

</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Janus

Balanced

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.68186 0.129107
31-Dec-95 1.25 11.91423 0.104917

Resulting Value 31-Dec-95 11.91423 99.76598 1188.634

1118.634
annualized 5.99%
cumulative 11.86%

</TABLE>
<PAGE>

Janus

Growth

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.848368 0.126925
31-Dec-95 1.25 12.6419 0.098878

Resulting Value 31-Dec-95 12.6419 99.7742 1261.336

1191.336
annualized 9.52%
cumulative 19.13%
<PAGE>

Janus
Aggressive
Growth

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 11.60132 0.107746
31-Dec-95 1.25 14.58482 0.085706

Resulting Value 31-Dec-95 14.58482 99.80655 1455.66

1385.66
annualized 18.45%
cumulative 38.57%
<PAGE>

Janus
Worldwide
Growth

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.672953 0.129226
31-Dec-95 1.25 12.14948 0.102885

Resulting Value 31-Dec-95 12.14948 99.76789 1212.128

1142.128
annualized 7.14%
cumulative 14.21%
<PAGE>

IAI

Regional

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.48355 0.119234
31-Dec-95 1.25 13.80249 0.090563

Resulting Value 31-Dec-95 13.80249 99.7902 1377.353

1307.353
annualized 14.93%
cumulative 30.74%
<PAGE>

IAI

Reserve

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.09393 0.123837
31-Dec-95 1.25 10.46035 0.119499

Resulting Value 31-Dec-95 10.46035 99.75666 1043.49

980.4895
annualized -1.02%
cumulative -1.95%
<PAGE>

IAI

Balanced

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.08868 0.123901
31-Dec-95 1.25 11.56131 0.108119

Resulting Value 31-Dec-95 11.56131 99.76798 1153.448

1083.448
annualized 4.25%
cumulative 8.34%
<PAGE>

Fidelity
Money
Market

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.26692 0.12175
31-Dec-95 1.25 10.7189 0.116616

Resulting Value 31-Dec-95 10.7189 99.76163 1069.335

1006.335
annualized 0.33%
cumulative 0.63%
<PAGE>

Fidelity
Equity
Income

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.28265 0.121564
31-Dec-95 1.25 13.69857 0.09125

Resulting Value 31-Dec-95 13.69857 99.78719 1366.941

1296.941
annualized 14.45%
cumulative 29.69%
<PAGE>

Fidelity

Growth

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.726292 0.128518
31-Dec-95 1.25 12.98345 0.096276

Resulting Value 31-Dec-95 12.98345 99.77521 1295.426

1225.426
annualized 11.13%
cumulative 22.54%
<PAGE>

Fidelity

Overseas

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.697194 0.128903
31-Dec-95 1.25 10.48805 0.119183

Resulting Value 31-Dec-95 10.48805 99.75191 1046.203

983.2028
annualized -0.88%
cumulative -1.68%
<PAGE>

Fidelity
Asset
Manager

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.093297 0.137464
31-Dec-95 1.25 10.48761 0.119188

Resulting Value 31-Dec-95 10.48761 99.74335 1046.069

983.0691
annualized -0.88%
cumulative -1.69%
<PAGE>

Federated
Corporate
Bond

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.503301 0.131533
31-Dec-95 1.25 11.28137 0.110802

Resulting Value 31-Dec-95 11.28137 99.75766 1125.403

1055.403
annualized 2.84%
cumulative 5.54%
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Federated

Utility

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.502484 0.131545
31-Dec-95 1.25 11.63673 0.107419

Resulting Value 31-Dec-95 11.63673 99.76104 1160.892

1090.892
annualized 4.62%
cumulative 9.09%

</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Federated

US Govt

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 10.09947 0.123769
31-Dec-95 1.25 10.83261 0.115392

Resulting Value 31-Dec-95 10.83261 99.76084 1080.671

1017.671
annualized 0.91%
cumulative 1.77%

</TABLE>
<PAGE>

Scudder

Bond

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
<S> <C> <C> <C> <C> <C>
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.273991 0.134786
31-Dec-95 1.25 10.80714 0.115664

Resulting Value 31-Dec-95 10.80714 99.74955 1078.007

1015.007
annualized 0.78%
cumulative 1.50%
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
Scudder

Balanced

fee allocation 1.25 From 27-Jan-94
to 31-Dec-95

# of years 1.926027

$ Value Unit Value # Units End Value
<S> <C> <C> <C> <C> <C>
Initial Deposit 27-Jan-94 1000 10 100
fee 31-Dec-94 1.25 9.483422 0.131809
31-Dec-95 1.25 11.84589 0.105522

Resulting Value 31-Dec-95 11.84589 99.76267 1181.778

1111.778
annualized 5.66%
cumulative 11.18%

</TABLE>