INDIVIDUAL FLEXIBLE PREMIUM DEFERRED VARIABLE
ANNUITY CONTRACT
ISSUED BY
LUTHERAN BROTHERHOOD
Supplement to Prospectus Dated April 28, 1995
The general purpose of this supplement is to provide information about the two
new Subaccounts, the Opportunity Growth Subaccount and the World Growth
Subaccount, that are now available under LB Variable Annuity Account I (the
"Variable Account"). The assets of these Subaccounts will be invested
exclusively in shares of the new Opportunity Growth Portfolio and the World
Growth Portfolio of LB Series Fund, Inc. (the "Fund"). The investment
objectives of the new Portfolios are:
Opportunity Growth Portfolio. To achieve long term growth of capital by
investing primarily in a professionally managed diversified portfolio of
smaller capitalization common stocks.
World Growth Portfolio. To achieve long-term growth of capital by investing
primarily in a professionally managed diversified portfolio of common stocks
of established, non-U.S. companies.
The prospectus for the Fund fully describes the investment objectives and
attendant risks of the Opportunity Growth Portfolio and the World Growth
Portfolio, along with the four other Portfolios.
Accordingly, the following changes are made to the prospectus for the
Contract:
1. All current references to the various Subaccounts of the Variable Account
and Portfolios of the Fund are changed to include the Opportunity Growth
Subaccount and the World Growth Subaccount and the Opportunity Growth
Portfolio and the World Growth Portfolio.
2. The current references to the Fund and its investment advice is amended to
include the following:
Lutheran Brotherhood ("LB") is the investment adviser of the Fund. LB was
founded in 1917 as a fraternal benefit society, owned by and operated for its
members, under the laws of Minnesota. LB has been engaged in the investment
advisory business since 1970, either directly or through the indirect
ownership of Lutheran Brotherhood Research Corp., the Fund's investment
adviser prior to January 31, 1994.
For its services, LB receives from the Fund a daily investment advisory fee
equal to an annual rate of .40% of the aggregate average daily net assets of
the Money Market, Income, High Yield, Growth, and Opportunity Growth
Portfolios. LB also receives an annual investment advisory fee from the Fund
equal to .85% of the aggregate average daily net assets of the World Growth
Portfolio.
LB has engaged Rowe Price-Fleming International, Inc., ("Price-Fleming") as
investment sub-advisor for the World Growth Portfolio. Price-Fleming was
founded in 1979 as a joint venture between T. Rowe Price Associates, Inc. and
Robert Fleming Holdings Limited. Price-Fleming is one of the world's largest
international mutual fund asset managers with approximately $17 billion under
management as of December 31, 1994 in its offices in Baltimore, London, Tokyo
and Hong Kong. Price-Fleming has an investment advisory group that has day-to-
day responsibility for managing the World Growth Portfolio and developing and
executing the Portfolio's investment program.
LB pays the Sub-advisor for the World Growth Portfolio an annual sub-advisory
fee for the performance of sub-advisory services. The fee payable is equal to
a percentage of the that Portfolio's average daily net assets. The percentage
varies with the size of Portfolio's net assets, decreasing as the Portfolio's
assets increase. The formula for determining the sub-advisory fee is described
fully in the prospectus for the Fund.
3. The Summary Fee Table on pages 6-7 of the prospectus is amended to read as
follows:
The Contract Owner may allocate premiums and transfer Accumulated Value to any
one of six Subaccounts -- Growth, High Yield, Income, Opportunity Growth,
World Growth and Money Market -- or to the Fixed Account or to any combination
of the Subaccounts and the Fixed Account. The following table shows the
various fees and expenses associated with the Contract.
The date of this Supplement is January 17, 1996
Contract Owner Transaction Expenses
Sales Load Imposed on Purchase
(as a percentage of purchase payments) 0%
Maximum Deferred Sales Load
(as a percentage of Excess Amount surrendered) 6% (1)
Exchange Fee 0%
Annual Contract Fee $30.00 (2)
Annual Expenses For Growth, High Yield, Income, Money Market
and Opportunity Growth Subaccounts
(as a percentage of average daily Accumulated Value or Annuity Unit Value)
Mortality and Expense Risk Fees 1.10% (3)
Total Variable Account Annual Expenses 1.10%
Annual Expenses For Growth, High Yield, Income, Money Market
and Opportunity Growth Portfolios
(as a percentage of Fund average daily net assets)
Management Fees (Investment Advisory Fees) 0.40% (4)
Other Expenses After Expense Reimbursement 0% (5)
Total Fund Annual Expenses 0.40%
EXAMPLE (6)
1 year 3 years 5 years 10 years
------ ------- ------- --------
If you surrender your Contract at the end
of the applicable time period:
You would pay the following expenses
on a $1,000 investment, assuming 5%
annual return on assets $71 $88 $105 $182
If you do not surrender your Contract:
You would pay the following expenses on
a $1,000 investment, assuming 5%
annual return on assets $16 $48 $83 $182
Annual Expenses For World Growth Subaccount
(as a percentage of average daily Accumulated Value or Annuity Unit Value)
Mortality and Expense Risk Fees 1.10% (3)
Total Variable Account Annual Expenses 1.10%
Annual Expenses For World Growth Portfolio
(as a percentage of Fund average daily net assets)
Management Fees (Investment Advisory Fees) 0.85% (4)
Other Expenses After Expense Reimbursement 0% (5)
Total Fund Annual Expenses 0.85%
EXAMPLE (6)
1 year 3 years 5 years 10 years
------ ------- ------- --------
If you surrender your Contract at the end
of the applicable time period:
You would pay the following expenses on
a $1,000 investment, assuming 5%
annual return on assets $76 $101 $128 $231
If you do not surrender your Contract:
You would pay the following expenses on
a $1,000 investment, assuming 5%
annual return on assets $20 $62 $107 $231
_________________
(1) See "CHARGES AND DEDUCTIONS--Surrender Charge (Contingent Deferred Sales
Charge)". A surrender charge is deducted only if a full or partial surrender
occurs during the first six Contract Years; no surrender charge is deducted
for surrenders occurring in Contract Years seven and later. Up to 10% of the
Accumulated Value existing at the time the first surrender in a Contract Year
is made may be surrendered without charge; only the Excess Amount will be
subject to a surrender charge. The maximum charge is 6% of the Excess Amount
and is in effect for the first Contract Year. Thereafter, the surrender
charge decreases by 1% each subsequent Contract Year.
(2) See "CHARGES AND DEDUCTIONS--Administrative Charge". A $30 annual
administrative charge is deducted on each Contract Anniversary only if, on
that Contract Anniversary, the total of premiums paid under the Contract minus
all prior surrenders is less than $5,000. The $30 fee is a Contract charge
and is deducted proportionately from the Subaccounts and the Fixed Account
that make up the Contract's Accumulated Value.
(3) See "CHARGES AND DEDUCTIONS--Mortality and Expense Risk Charge".
(4) See "CHARGES AND DEDUCTIONS--Investment Advisory Fee of the Fund".
(5) The amount shown for Fund Annual Expenses does not reflect a deduction
for operating expenses of the Fund, other than the investment advisory fee,
because LB and its affiliates have agreed to reimburse the Fund for these
operating expenses. See "LUTHERAN BROTHERHOOD, THE VARIABLE ACCOUNT AND THE
FUND--LB Series Fund, Inc.".
(6) In this example, the $30 annual administrative charge is approximated as
a .03% charge based on LB's average contract size.
The purpose of the table is to assist the Contract Owner in understanding the
various costs and expenses that a Contract Owner will bear directly or
indirectly. The table reflects expenses of the Variable Account as well as
the Fund. Cross-references to the relevant sections of the Prospectus for
more complete descriptions of the various costs and expenses have been
provided.
THE EXAMPLE SHOWING EXPENSES FOR SURRENDERS AT 1, 3, 5, AND 10-YEAR PERIODS
SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES AND
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
4. Compensation of LB representatives as described in the section "Sales and
Other Agreements" on page 31 of the prospectus is changed to read as follows:
LB representatives selling the Contracts will be paid a commission equal to a
percentage of premiums paid on the contracts sold. The percentage will be
based on the age of the Annuitant as shown below:
Attained Age Commission
Through 52 4.0%
53 3.8
54 3.6
55 3.4
56 3.2
57-72 3.0
73 2.8
74 2.6
75 2.4
76 2.2
77 and older 2.0
o:\law\doc\LB-VA\n-4\1996\stick96b.doc
