INHERITAGE ACCOUNT OF ALLMERIC FINANCIAL LIFE INS & ANN CO, 497, 2000-05-02

INHERITAGE ACCOUNT OF ALLMERIC FINANCIAL LIFE INS & ANN CO
497, 2000-05-02

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ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
WORCESTER, MASSACHUSETTS
INDIVIDUAL JOINT SURVIVORSHIP FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES
VARIABLE INHEIRITAGE

This Prospectus provides important information about Allmerica Variable
Inheiritage, an individual joint survivorship flexible premium variable life
insurance policy issued by Allmerica Financial Life Insurance and Annuity
Company. The policies are funded through the Inheiritage Account, a separate
investment account of this Company that is referred to as the Separate Account,
and a fixed-interest account also referred to as the General Account. Life
insurance coverage is provided for two Insureds, with Death Proceeds payable at
death of the last surviving Insured. Applicants must be Age 80 or under with
respect to the younger Insured, and Age 85 or under with respect to the older
Insured. PLEASE READ THIS PROSPECTUS CAREFULLY BEFORE INVESTING AND KEEP IT FOR
FUTURE REFERENCE.

The Separate Account is subdivided into Sub-Accounts. Each Sub-Account invests
exclusively in shares of one of the following Funds of Allmerica Investment
Trust, Fidelity Variable Insurance Products Fund, Fidelity Variable Insurance
Products Fund II, T. Rowe Price International Series, Inc., and Delaware Group
Premium Fund:

<TABLE>
<S> <C>
ALLMERICA INVESTMENT TRUST FIDELITY VARIABLE INSURANCE PRODUCTS
Select Aggressive Growth Fund FUND
Select Capital Appreciation Fund Fidelity VIP Overseas Portfolio
Select Value Opportunity Fund Fidelity VIP Equity-Income Portfolio
Select Emerging Markets Fund Fidelity VIP Growth Portfolio
Select International Equity Fund Fidelity VIP High Income Portfolio
Select Growth Fund FIDELITY VARIABLE INSURANCE PRODUCTS
Select Strategic Growth Fund FUND II
Core Equity Fund Fidelity VIP II Asset Manager Portfolio
Equity Index Fund T. ROWE PRICE INTERNATIONAL SERIES, INC.
Select Growth and Income Fund T. Rowe Price International Stock
Select Investment Grade Income Fund Portfolio
Government Bond Fund DELAWARE GROUP PREMIUM FUND
Money Market Fund DGPF International Equity Series
</TABLE>

THE PURPOSE OF THE POLICIES IS TO PROVIDE INSURANCE PROTECTION FOR THE
BENEFICIARY. NO CLAIM IS MADE THAT THE POLICY IS IN ANY WAY SIMILAR OR
COMPARABLE TO A SYSTEMATIC INVESTMENT PLAN OF A MUTUAL FUND. THE POLICY,
TOGETHER WITH ITS ATTACHED APPLICATION, CONSTITUTES THE ENTIRE AGREEMENT BETWEEN
YOU AND THE COMPANY.

THE POLICIES ARE NOT SUITABLE FOR SHORT-TERM INVESTMENT. VARIABLE LIFE POLICIES
INVOLVE RISKS INCLUDING POSSIBLE LOSS OF PRINCIPAL. IT MAY NOT BE ADVANTAGEOUS
TO REPLACE EXISTING INSURANCE WITH THE POLICY. THIS LIFE POLICY IS NOT: A BANK
DEPOSIT OR OBLIGATION; OR FEDERALLY INSURED; OR ENDORSED BY ANY BANK OR
GOVERNMENTAL AGENCY.

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED THAT THE INFORMATION IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

This Prospectus can also be obtained from the Securities and Exchange
Commission's website (http://www.sec.gov).

<TABLE>
<S> <C>
CORRESPONDENCE MAY BE MAILED TO: DATED MAY 1, 2000
ALLMERICA LIFE 440 LINCOLN STREET
P.O. BOX 8014 WORCESTER, MASSACHUSETTS 01653
BOSTON, MA 02266-8014 (508) 855-1000
</TABLE>
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TABLE OF CONTENTS

<TABLE>
<S> <C>
SPECIAL TERMS............................................... 4
SUMMARY OF FEES AND CHARGES................................. 7
SUMMARY OF POLICY FEATURES.................................. 11
DESCRIPTION OF THE COMPANY, THE SEPARATE ACCOUNT AND THE
UNDERLYING FUNDS........................................... 19
INVESTMENT OBJECTIVES AND POLICIES.......................... 22
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS........... 24
THE POLICY.................................................. 25
Applying for the Policy................................... 25
Free-Look Period.......................................... 25
Conversion Privileges..................................... 26
Premium Payments.......................................... 26
Incentive Funding Discount................................ 27
Guaranteed Death Benefit Rider............................ 28
Paid-up Insurance Option.................................. 29
Allocation of Net Premiums................................ 29
Transfer Privilege........................................ 30
Death Proceeds............................................ 31
Sum Insured Options....................................... 32
Change in Sum Insured Option.............................. 35
Change in Face Amount..................................... 35
Policy Value and Surrender Value.......................... 36
Death Proceeds Payment Options............................ 38
Optional Insurance Benefits............................... 38
Policy Surrender.......................................... 38
Partial Withdrawals....................................... 39
CHARGES AND DEDUCTIONS...................................... 40
Tax Expense Charge........................................ 40
Premium Expense Charge.................................... 40
Monthly Deduction from Policy Value....................... 40
Charges Against Assets of the Separate Account............ 42
Surrender Charge.......................................... 43
Charges on Partial Withdrawals............................ 44
Transfer Charges.......................................... 45
Charge for Increase in Face Amount........................ 45
Other Administrative Charges.............................. 46
POLICY LOANS................................................ 46
Repayment of Loans........................................ 47
Effect of Policy Loans.................................... 47
POLICY TERMINATION AND REINSTATEMENT........................ 47
Termination............................................... 47
Reinstatement............................................. 48
OTHER POLICY PROVISIONS..................................... 49
VOTING RIGHTS............................................... 50
DIRECTORS AND PRINCIPAL OFFICERS OF THE COMPANY............. 51
DISTRIBUTION................................................ 52
REPORTS..................................................... 52
LEGAL PROCEEDINGS........................................... 53
FURTHER INFORMATION......................................... 53
INDEPENDENT ACCOUNTANTS..................................... 53
FEDERAL TAX CONSIDERATIONS.................................. 53
The Company and the Separate Account...................... 53
</TABLE>

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<TABLE>
<S> <C>
Taxation of the Policies.................................. 54
Modified Endowment Contracts.............................. 55
Estate and Generation-Skipping Taxes...................... 55
MORE INFORMATION ABOUT THE GENERAL ACCOUNT.................. 56
FINANCIAL STATEMENTS........................................ 57
APPENDIX A -- OPTIONAL BENEFITS............................. A-1
APPENDIX B -- PAYMENT OPTIONS............................... B-1
APPENDIX C -- ILLUSTRATIONS................................. C-1
APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES...... D-1
APPENDIX E -- PERFORMANCE INFORMATION....................... E-1
FINANCIAL STATEMENTS........................................ FIN-1
</TABLE>

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SPECIAL TERMS

ACCUMULATION UNIT: A measure of your interest in a Sub-Account.

AGE: An Insured's age as of the nearest birthday measured from the Policy
anniversary.

BENEFICIARY: The person(s) designated by the owner of the Policy to receive the
insurance proceeds upon the death of the last surviving Insured.

COMPANY: Allmerica Financial Life Insurance and Annuity Company. We," "our,"
"us," and "the Company" refer to Allmerica Financial Life Insurance and Annuity
Company in this Prospectus.

DATE OF ISSUE: The date set forth in the Policy used to determine the Monthly
Payment Date, Policy months, Policy years, and Policy anniversaries.

DEATH PROCEEDS: Prior to the Final Premium Payment Date, the Death Proceeds
equal the amount calculated under the applicable Sum Insured Option (Option 1 or
Option 2), less Debt outstanding at death of the last surviving Insured, partial
withdrawals, if any, partial withdrawal charges, and any due and unpaid Monthly
Deductions. After the Final Premium Payment Date, the Death Proceeds equal the
Surrender Value of the Policy, unless the Guaranteed Death Benefit rider is in
effect. If the Rider is in effect, the Death Proceeds will be the greater of
(a) the Face Amount as of the final Premium Payment Date, or (b) the Policy
Value as of the date due proof of death for Option 2 and date of death for
Option 1 is received by the Company. This Rider may not be available in all
states.

DEBT: All unpaid Policy loans plus interest due or accrued on such loans.

DELIVERY RECEIPT: An acknowledgment, signed by the Policyowner and returned to
the Company's Principal Office, that the Policyowner has received the Policy and
the Notice of Withdrawal Rights.

EVIDENCE OF INSURABILITY: Information, including medical information
satisfactory to the Company, that is used to determine the Insureds' Premium
Class.

FACE AMOUNT: The amount of insurance coverage applied for. The Face Amount of
each Policy is set forth in the specification pages of the Policy.

FINAL PREMIUM PAYMENT DATE: The Policy anniversary nearest the younger Insured's
95th birthday. The Final Premium Payment Date is the latest date on which a
premium payment may be made. After this date, the Death Proceeds equal the
Surrender Value of the Policy, unless the optional Guaranteed Death Benefit
Rider is in effect. This Rider may not be available in all states. The Net Death
Benefit may be different before and after the Final Payment Date. See DEATH
PROCEEDS.

GENERAL ACCOUNT: All the assets of the Company other than those held in a
separate account.

GUIDELINE ANNUAL PREMIUM: The annual amount of premium that would be payable
through the Final Premium Payment Date of the Policy for the specified Sum
Insured, if premiums were fixed by the Company as to both timing and amount, and
monthly cost of insurance charges were based on the 1980 Commissioners Standard
Ordinary Mortality Tables (Mortality Table D, Smoker or Non-Smoker, for unisex
Policies), net investment earnings at an annual effective rate of 5%, and fees
and charges as set forth in the Policy and any Policy riders. The Sum Insured
Option 1 Guideline Annual Premium is used when calculating the maximum surrender
charge.

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GUIDELINE MINIMUM SUM INSURED: The minimum Sum Insured required to qualify the
Policy as "life insurance" under federal tax laws. The Guideline Minimum Sum
Insured varies by Age. It is calculated by multiplying the Policy Value by a
percentage determined by the younger Insured's Age.

The percentage factor is a percentage that, when multiplied by the Policy Value,
determines the minimum death benefit required under federal tax laws. For both
the Option 1 and the Option 2, the percentage factor is based on the younger
Insured's attained age on Death of Last Surviving Insured, as set forth in
GUIDELINE MINIMUM SUM INSURED TABLE 1 and TABLE 2 in SUM INSURED OPTIONS --
"GUIDELINE MINIMUM SUM INSURED".

INSURANCE AMOUNT AT RISK: The Sum Insured less the Policy Value.

INSUREDS: The two persons covered under the Policy.

LOAN VALUE: The maximum amount that may be borrowed under the Policy.

MINIMUM MONTHLY FACTOR: The Minimum Monthly Factor is a monthly premium amount
calculated by the Company and specified in the Policy. If, in the first 48
Policy months following Date of Issue or the effective date of an increase in
the Face Amount or of a Policy Change which causes a change in the Minimum
Monthly Factor:

- You make premium payments (less debt, partial withdrawals and partial
withdrawal charges) at least equal to the sum of the Minimum Monthly
Factors for the number of months the Policy, increase in Face Amount or
Policy Change has been in force, and

- Debt does not exceed Policy Value less surrender charges, then

- the Policy is guaranteed not to lapse during that period.

EXCEPT FOR THE 48 POLICY MONTH PERIODS, MAKING MONTHLY PAYMENTS AT LEAST EQUAL
TO THE MINIMUM MONTHLY FACTOR DOES NOT GUARANTEE THAT THE POLICY WILL REMAIN IN
FORCE.

MONTHLY DEDUCTION: Charges deducted monthly from the Policy Value of the Policy
prior to the Final Premium Payment Date. The charges include the monthly cost of
insurance, the monthly cost of any benefits provided by riders, and the monthly
administrative charge.

MONTHLY PAYMENT DATE: The date on which the Monthly Deduction is deducted from
Policy Value.

NET PREMIUM: An amount equal to the premium less a tax expense charge and
premium expense charge.

PAID-UP INSURANCE: Joint survivorship insurance coverage for the lifetime of the
Insureds, with no further premiums due.

POLICY CHANGE: Any change in the Face Amount, the addition or deletion of a
rider, or a change in the Sum Insured Option.

POLICY VALUE: The total amount available for investment under the Policy at any
time. It is equal to the sum of (a) the value of the Accumulation Units credited
to the Policy in the Sub-Accounts and (b) the accumulation in the General
Account credited to that Policy.

POLICYOWNER: the person, persons or entity entitled to exercise the rights and
privileges under the Policy.

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PREMIUM CLASS: The risk classification that the Company assigns the Insureds
based on the information in the application and any other Evidence of
Insurability considered by the Company. The Insureds' Premium Class will affect
the cost of insurance charge and the amount of premium required to keep the
Policy in force.

PRINCIPAL OFFICE: The Company's office, located at 440 Lincoln Street,
Worcester, Massachusetts 01653.

PRO-RATA ALLOCATION: In certain circumstances, you may specify from which
Sub-Account certain deductions will be made or to which Sub-Account Policy Value
will be allocated. If you do not, the Company will allocate the deduction or
Policy Value among the General Account and the Sub-Accounts in the same
proportion that the Policy Value in the General Account and the Policy Value in
each Sub-Account bear to the total Policy Value on the date of deduction or
allocation.

SEPARATE ACCOUNT: A Separate Account consists of assets segregated from the
Company's other assets. The investment performance of the assets of each
Separate Account is determined separately from the other assets of the Company.
The assets of a Separate Account which are equal to the reserves and other
contract liabilities are not chargeable with liabilities arising out of any
other business which the Company may conduct.

SUB-ACCOUNT: A division of the Separate Account. Each Sub-Account invests
exclusively in the shares of a corresponding Fund of the Allmerica Investment
Trust ("Trust"), a corresponding Portfolio of the Fidelity Variable Insurance
Products Fund ("Fidelity VIP") or of Fidelity Variable Insurance Products Fund
II (Fidelity VIP II"), or the T. Rowe Price International Stock Portfolio of T.
Rowe Price International Series, Inc. ("T. Rowe Price"), or Series of Delaware
Group Premium Fund ("DGPF").

SUM INSURED: The amount payable upon the death of the last surviving Insured,
before the Final Premium Payment Date, prior to deductions for Debt outstanding
at the death of the last surviving Insured, partial withdrawals and partial
withdrawal charges, if any, and any due and unpaid Monthly Deductions. The
amount of the Sum Insured will depend on the Sum Insured Option chosen, but will
always be at least equal to the Face Amount.

SURRENDER VALUE: The amount payable upon a full surrender of the Policy. It is
the Policy Value less any Debt and applicable surrender charges.

UNDERLYING FUNDS (FUNDS): The Funds of the Allmerica Investment Trust, the
Portfolios of the Fidelity Variable Insurance Products Fund and Fidelity
Variable Insurance Products Fund II, the Portfolio of T. Rowe Price
International Series, and the Series of Delaware Group Premium Fund, which are
available under the Policy.

VALUATION DATE: A day on which the net asset value of the shares of any of the
Underlying Funds is determined and Accumulation Unit values of the Sub-Accounts
are determined. Valuation Dates currently occur on each day on which the New
York Stock Exchange is open for trading, and on such other days (other than a
day during which no payment, partial withdrawal, or surrender of the Policy is
received) when there is a sufficient degree of trading in an Underlying Fund's
securities such that the current net asset value of the Sub-Accounts may be
materially affected.

WRITTEN REQUEST: A request by the Policyowner in writing, satisfactory to the
Company.

YOU OR YOUR: The Policyowner, as shown in the application or the latest change
filed with the Company.

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SUMMARY OF FEES AND CHARGES

POLICY FEES AND CHARGES

THERE ARE COSTS RELATED TO THE INSURANCE AND INVESTMENT FEATURES OF THE POLICY.
FEES AND CHARGES TO COVER THESE COSTS ARE DEDUCTED IN SEVERAL WAYS.

TAX EXPENSE CHARGE

A charge will be deducted from each premium payment for state and local premium
taxes paid by the Company for the Policy and to compensate the Company for
federal taxes imposed for deferred acquisition cost ("DAC") taxes. The total
charge is the actual state and local premium taxes paid by the Company, varying
according to jurisdiction, and a DAC tax deduction of 1% of premiums. See
CHARGES AND DEDUCTIONS -- "Tax Expense Charge."

PREMIUM EXPENSE CHARGE

A charge of 1% of premiums will be deducted from each premium payment to
partially compensate the Company for sales expenses related to the Policies. See
CHARGES AND DEDUCTIONS -- "Premium Expense Charge."

MONTHLY DEDUCTIONS FROM POLICY VALUE

On the Date of Issue and each Monthly Payment Date, certain charges ("Monthly
Deductions") will be deducted from the Policy Value. The Monthly Deduction
consists of a charge for cost of insurance, a charge for administrative
expenses, and a charge for the cost of any additional benefits provided by
rider. You may instruct the Company to deduct the Monthly Deduction from one
specific Sub-Account. If you do not, the Company will make a Pro-Rata Allocation
of the charge. No Monthly Deductions are made on or after the Final Premium
Payment Date. See CHARGES AND DEDUCTIONS -- "Monthly Deduction from Policy
Value."

The MONTHLY COST OF INSURANCE CHARGE is determined by multiplying the Insurance
Amount at Risk for each Policy month by the applicable cost of insurance rate or
rates. The Insurance Amount at Risk will be affected by any decreases or
increases in the Face Amount.

A MONTHLY ADMINISTRATIVE CHARGE of $6 per month is made for administrative
expenses. The charge is designed to reimburse the Company for the costs
associated with issuing and administering the Policies, such as processing
premium payments, Policy loans and loan repayments, changes in Sum Insured
Option, and death claims. These charges also help cover the cost of providing
annual statements and responding to Policyowner inquiries.

As noted above, certain ADDITIONAL INSURANCE RIDER BENEFITS are available under
the Policy for an additional monthly charge. See APPENDIX A -- OPTIONAL
BENEFITS.

DEDUCTIONS FROM THE SEPARATE ACCOUNT

A daily charge currently equivalent to an effective annual rate of 1.15% of the
average daily net asset value of each Sub-Account of the Separate Account is
imposed to compensate the Company for its assumption of certain mortality and
expense risks and for administrative costs associated with the Separate Amount.
The rate is 0.90% for the mortality and expense risk and 0.25% for the Separate
Account administrative charge. The administrative charge is eliminated after the
15 Policy year. See CHARGES AND DEDUCTIONS -- "Charges Against Assets of the
Separate Account."

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CHARGES OF THE UNDERLYING FUNDS

In addition to the charges described above, certain fees and expenses are
deducted from the assets of the Underlying Funds. The levels of fees and
expenses vary among the Underlying Funds. The following table shows the expenses
of the Underlying Funds for 1999.

<TABLE>
<CAPTION>
TOTAL FUND
MANAGEMENT FEE OTHER EXPENSES EXPENSES
(AFTER ANY VOLUNTARY (AFTER ANY APPLICABLE (AFTER ANY WAIVERS/
UNDERLYING FUND WAIVERS) REIMBURSEMENTS) REIMBURSEMENTS)
- --------------- -------------------- --------------------- -------------------
<S> <C> <C> <C>
Select Aggressive Growth Fund............ 0.81%* 0.06% 0.87%(1)(2)*
Select Capital Appreciation Fund......... 0.90%* 0.07% 0.97%(1)*
Select Value Opportunity Fund............ 0.90% 0.07% 0.97%(1)(2)
Select Emerging Markets Fund............. 1.35% 0.57% 1.92%(1)(2)
Select International Equity Fund......... 0.89% 0.13% 1.02%(1)(2)
DGPF International Equity Series......... 0.83%(4) 0.12% 0.95%(4)
Fidelity VIP Overseas Portfolio.......... 0.73% 0.18% 0.91%(3)
T. Rowe Price International Stock
Portfolio............................... 1.05% 0.00% 1.05%
Select Growth Fund....................... 0.78% 0.05% 0.83%(1)(2)
Select Strategic Growth Fund............. 0.85% 0.35% 1.20%(1)(2)
Core Equity Fund......................... 0.43% 0.05% 0.48%(1)(2)
Fidelity VIP Growth Portfolio............ 0.58% 0.08% 0.66%(3)
Equity Index Fund........................ 0.28% 0.07% 0.35%(1)
Select Growth and Income Fund............ 0.67% 0.07% 0.74%(1)(2)
Fidelity VIP Equity-Income Portfolio..... 0.48% 0.09% 0.57%(3)
Fidelity VIP II Asset Manager
Portfolio............................... 0.53% 0.10% 0.63%(3)
Fidelity VIP High Income Portfolio....... 0.58% 0.11% 0.69%
Select Investment Grade Income Fund...... 0.43% 0.07% 0.50%(1)
Government Bond Fund..................... 0.50% 0.12% 0.62%(1)
Money Market Fund........................ 0.24% 0.05% 0.29%(1)
</TABLE>

(*) Effective September 1, 1999, the management fee rates for the Select
Aggressive Growth Fund and Select Capital Appreciation Fund were revised. The
Management Fee and Total Fund Expense ratios shown in the table above have been
adjusted to assume that the revised rates took effect January 1, 1999.

(1) Until further notice, Allmerica Financial Investment Management
Services, Inc. ("AFIMS") has declared a voluntary expense limitation of 1.50% of
average net assets for Select International Equity Fund, 1.35% for Select
Aggressive Growth Fund and Select Capital Appreciation Fund, 1.25% for Select
Value Opportunity Fund, 1.20% for Select Growth Fund and Core Equity Fund, 1.10%
for Select Growth and Income Fund, 1.00% for Select Investment Grade Income
Fund, and Government Bond Fund, and 0.60% for Money Market Fund and Equity Index
Fund. The total operating expenses of these Funds of the Trust were less than
their respective expense limitations throughout 1999.

Until further notice, the Select Value Opportunity Fund's management fee rate
has been voluntarily limited to an annual rate of 0.90% of average daily net
assets, and total expenses are limited to 1.25% of average daily net assets.

The declaration of a voluntary management fee or expense limitation in any year
does not bind AFIMS to declare future expense limitations with respect to these
Funds. These limitations may be terminated at any time.

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(2) These Funds have entered into agreements with brokers whereby the brokers
rebate a portion of commissions. These amounts have been treated as reductions
of expenses. Including these reductions, total annual fund operating expenses
were 1.01% for Select International Equity Fund, 1.88% for Select Emerging
Markets, 0.84% for Select Aggressive Growth Fund, 0.88% for Select Value
Opportunity Fund, 0.81% for Select Growth Fund, 1.17% for Select Strategic
Growth Fund, 0.45% for Core Equity Fund, and 0.73% for Select Growth and Income
Fund.

(3) A portion of the brokerage commissions that certain funds paid was used to
reduce fund expenses. In addition, through arrangements with certain funds', or
Fidelity Management & Research Company on behalf of certain funds', custodian
credits realized as a result of uninvested cash balances were used to reduce a
portion of the fund's expenses. Including these reductions, total operating
expenses presented in the table would have been 0.87% for the Fidelity VIP
Overseas Portfolio; 0.56% for the Fidelity VIP Equity-Income Portfolio; 0.62%
for the Fidelity VIP II Asset Manager Portfolio and 0.65% for the Fidelity VIP
Growth Portfolio.

(4) The investment adviser for the DGPF International Equity Series is Delaware
International Advisers Ltd. ("Delaware International"). Effective May 1, 2000
through October 31, 2000, Delaware International has agreed voluntarily to waive
its management fee and reimburse the Series for expenses to the extent that
total expenses will not exceed 0.95%. This limitation replaces a prior
limitation of 0.95% that expired on April 30, 2000. The fee ratios shown above
have been restated, if necessary, to reflect the new voluntary limitation which
took effect on May 1, 2000. The declaration of a voluntary expense limitation
does not bind Delaware International to declare future expense limitations with
respect to this Series. For the fiscal year ended December 31, 1999, before
waiver and/or reimbursement by Delaware International, total fund expenses as a
percentage of average daily net assets were 0.97%.

The Underlying Fund information above was provided by the Underlying Funds and
was not independently verified by the Company.

OTHER CHARGES (NON-PERIODIC)

TRANSACTION CHARGE ON PARTIAL WITHDRAWALS

A transaction charge is assessed at the time of each partial withdrawal to
reimburse the Company for the cost of processing the withdrawal. The transaction
charge is the smaller of 2% of the amount withdrawn or $25. In addition to the
transaction charge, a partial withdrawal charge also may be made under certain
circumstances. See CHARGES AND DEDUCTIONS -- "Charges on Partial Withdrawals."
The transaction fee applies to all partial withdrawals including a Withdrawal
without a surrender charge (described below).

CHARGE FOR INCREASE IN THE FACE AMOUNT

For each increase in the Face Amount, a charge of $40 will be deducted from the
Policy Value. This charge is designed to reimburse the Company for underwriting
and administrative costs associated with the increase. See THE POLICY -- "Change
in the Face Amount" and CHARGES AND DEDUCTIONS -- "Charge for Increase in Face
Amount."

TRANSFER CHARGE

The first 12 transfers of Policy Value in the Policy year will be free of
charge. Thereafter, with certain exceptions, a transfer charge of $10 will be
imposed for each transfer request to reimburse the Company for the costs of
processing the transfer. See THE POLICY -- "Transfer Privilege" and CHARGES AND
DEDUCTIONS -- "Transfer Charges."

SURRENDER CHARGES

At any time that the Policy is in effect, the Policyowner may elect to surrender
the Policy and receive its Surrender Value. A surrender charge is calculated
upon issuance of the Policy and upon each increase in Face

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Amount. The duration of the surrender charge is 15 years. The surrender charge
is imposed only if, during its duration, you request a full surrender or a
decrease in the Face Amount.

SURRENDER CHARGE ON THE INITIAL FACE AMOUNT

The maximum surrender charge calculated upon issuance of the Policy is equal to
the sum of (a) plus (b) where (a) is a deferred administrative charge equal to
$8.50 per thousand dollars of the initial Face Amount, and (b) is a deferred
sales charge of 48% of premiums received up to a maximum number of Guideline
Annual Premiums subject to the deferred sales charge that varies by average
issue Age from 1.95 (for average issue Ages 5 through 75) to 1.31 (for average
issue Age 82). In accordance with limitations under state insurance regulations,
the amount of the maximum surrender charge will not exceed a specified amount
per $1,000 of initial Face Amount, as indicated in APPENDIX D -- CALCULATION OF
MAXIMUM SURRENDER CHARGES.

The maximum surrender charge initially remains level for 40 months, declines by
one-half of one percent of the initial amount for 80 months, and then declines
by one percent each month thereafter, reaching zero at the end of the 180 Policy
Months (15 Policy years), as described in APPENDIX D -- CALCULATION OF MAXIMUM
SURRENDER CHARGES. If you surrender the Policy during the first two Policy years
following the Date of Issue, before making premium payments associated with the
initial Face Amount which are at least equal to one Guideline Annual Premium,
the deferred administrative charge will be $8.50 per thousand dollars of initial
Face Amount, but the deferred sales charge will not exceed 25% of premiums
received. See THE POLICY -- "Surrender," and CHARGES AND DEDUCTIONS --
"Surrender Charge."

SURRENDER CHARGES FOR INCREASES IN FACE AMOUNT

A separate surrender charge will apply to and is calculated for each increase in
the Face Amount. The maximum surrender charge for the increase is equal to the
sum of (a) plus (b), where (a) is equal to $8.50 per thousand dollars of
increase, and (b) is a deferred sales charge of 48% of premiums associated with
the increase, up to a maximum number of Guideline Annual Premiums (for the
increase) subject to the deferred sales charge. Such deferred sales charge
varies by average Age (at the time of increase) from 1.95 (for average Ages 5
through 75) to 1.31 (for average Age 82). In accordance with limitations under
state insurance regulations, the amount of the surrender charge will not exceed
a specified amount per $1,000 of increase, as indicated in APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES.

As is true for the initial Face Amount, (a) is a deferred administrative charge
and (b) is a deferred sales charge. The maximum surrender charge initially
remains level for 40 months, declines by one-half of one percent of the initial
amount for 80 months, and then declines by one percent each month thereafter,
reaching zero at the end of the 180 Policy Months (15 Policy years), as
described in APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES. If you
surrender the Policy during the first two Policy years following an increase in
the Face Amount before making premium payments associated with the increase in
the Face Amount which are at least equal to one Guideline Annual Premium, the
deferred administrative charge will be $8.50 per thousand dollars of Face Amount
increase, but the deferred sales charge will not exceed 25% of premiums
associated with the increase.

SURRENDER CHARGES ON DECREASES IN FACE AMOUNT

In the event of a decrease in the Face Amount, the surrender charge imposed is
proportional to the charge that would apply to a full Policy surrender. See THE
POLICY -- "Policy Surrender," CHARGES AND DEDUCTIONS -- "Surrender Charge" and
APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES.

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SUMMARY OF POLICY FEATURES

This Summary is intended to provide only a very brief overview of the more
significant aspects of the Policy. If you are considering the purchase of this
product, you should read the remainder of this Prospectus carefully before
making a decision. It offers a more complete presentation of the topics
presented here, and will help you better understand the product. However, the
Policy, together with its attached application, constitutes the entire agreement
between you and the Company.

Policyowners may, within limits, choose the amount of initial payment and vary
the frequency and amount of future payments. The Policy allows partial
withdrawals and full surrender of the Policy's Surrender Value, within limits.
The Policies are not suitable for short-term investment because of the
substantial nature of the surrender charge. If the Policyowner thinks about
surrendering the Policy, the lower deferred sales charges that apply during the
first two years from the date of issue or an increase in Face Amount should be
considered.

There is no guaranteed minimum Policy Value. The value of the Policy will vary
up or down to reflect the investment experience of allocations to the
Sub-Accounts and the fixed rates of interest earned by allocations to the
General Account. The Policy Value will also be adjusted for other factors,
including the amount of charges imposed. The Policy will remain in effect so
long as the Policy Value less any surrender charges and less any outstanding
Debt is sufficient to pay certain monthly charges imposed in connection with the
Policy. The Policy Value may decrease to the point where the Policy will lapse
and provide no further death benefit without additional premium payments, unless
the optional Guaranteed Death Benefit Rider is in effect.

If the Policy is in effect at the death of the last surviving Insured, the
Company will pay a death benefit (the "Death Proceeds") to the Beneficiary.
Prior to the Final Premium Payment Date, the Death Proceeds equal the Sum
Insured, less any Debt, partial withdrawals, and any due and unpaid charges. You
may choose either Sum Insured Option 1 (the Sum Insured is fixed in amount) or
Sum Insured Option 2 (the Sum Insured includes the Policy Value in addition to a
fixed insurance amount). The Policyowner has the right to change the Sum Insured
option, subject to certain conditions. A Guideline Minimum Sum Insured,
equivalent to a percentage of the Policy Value, will apply if greater than the
Sum Insured otherwise payable under Option 1 or Option 2.

In certain circumstances, the Policy may be considered a "modified endowment
contract." Under the Internal Revenue Code of 1986 ("Code"), any Policy loan,
partial withdrawal or surrender from a modified endowment contract may be
subject to tax and tax penalties. See FEDERAL TAX CONSIDERATIONS -- "Modified
Endowment Contracts."

No claim is made that the Policy is in any way similar or comparable to a
systematic investment plan of a mutual fund.

ABOUT THE POLICY

The Policy allows you to make premium payments in any amount and frequency,
subject to certain limitations. As long as the Policy remains in force, it will
provide for:

- life insurance coverage on the named Insureds,

- Policy Value,

- surrender rights and partial withdrawal rights,

- loan privileges, and

- in some cases, additional insurance benefits available by rider for an
additional charge.

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LIFE INSURANCE

The Policy is a life insurance contract with death benefits, Policy Value, and
other features traditionally associated with life insurance. The Policy is a
"joint survivorship" Policy because Death Proceeds are payable, not on the death
of the first Insured to die, but on the death of the last surviving Insured. The
Policy is "variable" because the Policy Value will increase or decrease
depending on the investment experience of the Sub-Accounts of the Separate
Account. Under some circumstances, the death benefit may vary with the
investment experience of the Sub-Accounts.

CONDITIONAL INSURANCE AGREEMENT

If at the time of application you make a payment equal to at least one Minimum
Monthly Factor for the Policy as applied for, the Company will provide
conditional insurance, equal to the amount of insurance applied for but not to
exceed $500,000, subject to the terms of the Conditional Insurance Agreement. If
the application is approved, the Policy will be issued as of the date the terms
of the conditional insurance are met. If you do not wish to make any payment at
the time of application, insurance coverage will not be in force until delivery
of the Policy and payment of sufficient premium to place the insurance in force.

If any premiums are paid prior to the issuance of the Policy, such premiums will
be held in the Company's General Account. If your application is approved and
the Policy is issued and accepted, the initial premiums held in the General
Account will be credited with interest at a specified rate beginning not later
than the date of receipt of the premiums at the Principal Office. IF THE POLICY
IS NOT ISSUED AND ACCEPTED, THE INITIAL PREMIUMS WILL BE RETURNED TO YOU WITHOUT
INTEREST.

ALLOCATION OF INITIAL PREMIUMS

Net Premiums may be allocated to one or more Sub-Accounts of the Separate
Account, to the General Account, or to any combination of Accounts. You bear the
investment risks of amounts allocated to the Sub-Accounts. Allocations may be
made to no more than seven Sub-Accounts at any one time. The minimum allocation
is 1% of Net Premium. All allocations must be in whole numbers and must total
100%. See THE POLICY -- "Allocation of Net Premiums." Premiums allocated to the
General Account will earn a fixed rate of interest. Net premiums and minimum
interest are guaranteed by the Company. For more information, see MORE
INFORMATION ABOUT THE GENERAL ACCOUNT.

FREE-LOOK PERIOD -- The Policy provides for an initial free-look period. You may
cancel the Policy by mailing or delivering it to the Principal Office or to an
agent of the Company on or before the latest of:

- 45 days after the application for the Policy is signed,

- 10 days after you receive the Policy (or, if required by state law, the
longer period indicated in your Policy), or

- 10 days after the Company mails or personally delivers a Notice of
Withdrawal Rights to you.

When you return the Policy, the Company will mail a refund to you within seven
days. The refund of any premium by check may be delayed until the check has
cleared your bank.

Where required by state law, however, the Company will refund the entire amount
of premiums paid. In other states, the refund will equal the sum of:

(1) the difference between the premium, including fees and charges paid, and
any amount allocated to the Separate Account, PLUS

(2) the value of the amounts allocated to the Separate Account, PLUS

(3) any fees or charges imposed on the amounts allocated to the Separate
Account.

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The amount refunded in (1) above includes any premiums allocated to the General
Account. A free-look privilege also applies after a requested increase in the
Face Amount. See THE POLICY -- "Free-Look Period."

CONVERSION PRIVILEGES

During the first 24 Policy months after the Date of Issue, subject to certain
restrictions, you may convert the Policy to a fixed flexible premium adjustable
life insurance policy by simultaneously transferring all accumulated value in
the Sub-Accounts to the General Account and instructing the Company to allocate
all future premiums to the General Account. A similar conversion privilege is in
effect for 24 Policy months after the date of an increase in the Face Amount.
Where required by state law, and at your request, the Company will issue a
flexible premium adjustable life insurance policy to you. The new policy will
have the same Face Amount, issue age, Date of Issue, and Premium Class as the
original Policy. See THE POLICY -- "Conversion Privileges."

FLEXIBLE PREMIUM

The Policy is a "flexible premium" policy because, unlike traditional insurance
policies, there is no fixed schedule for premium payments. You may vary the
frequency and amount of future premium payments, subject to certain limits,
restrictions and conditions set by Company standards and federal tax laws.
Although you may establish a schedule of premium payments ("planned premium
payments"), failure to make the planned premium payments will not necessarily
cause the Policy to lapse. Because of the variable nature of the Policy, making
planned premium payments does not guarantee that the Policy will remain in
force. Thus, you may, but are not required to, pay additional premiums. If the
Guaranteed Death Benefit Rider is in effect, however, certain minimum premium
payment tests must be met. (This Rider may not be available in all states.)

The Policy will remain in force until the Surrender Value is insufficient to
cover the next Monthly Deduction and loan interest accrued, if any, and a grace
period of 62 days has expired without adequate payment being made by you. During
the first 48 Policy months after the Date of Issue or the effective date of an
increase in the Face Amount, the Policy will not lapse if the total premiums
paid less the Debt, partial withdrawals and withdrawal charges are equal to or
exceed the sum of the Minimum Monthly Factor for the number of months the
Policy, increase in Face Amount, or the Policy Change which causes a change in
the Minimum Monthly Factor has been in force. Even during these periods,
however, making payments at least equal to the Minimum Monthly Factor will not
prevent the Policy from lapsing if the Debt equals or exceeds the Policy Value
less surrender charges.

MINIMUM MONTHLY FACTOR

The Minimum Monthly Factor is a monthly premium amount calculated by the Company
and specified in the Policy. If, in the first 48 Policy months following Date of
Issue or the effective date of an increase in the Face Amount or of a Policy
Change which causes a change in the Minimum Monthly Factor:

- Debt does not exceed Policy Value less surrender charges, then

- the Policy is guaranteed not to lapse during that period.

EXCEPT FOR THE 48 POLICY MONTH PERIODS, MAKING MONTHLY PAYMENTS AT LEAST EQUAL
TO THE MINIMUM MONTHLY FACTOR DOES NOT GUARANTEE THAT THE POLICY WILL REMAIN IN
FORCE.

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GUARANTEED DEATH BENEFIT RIDER (MAY NOT BE AVAILABLE IN ALL STATES)

This Rider, WHICH IS AVAILABLE ONLY AT DATE OF ISSUE:

- guarantees that the Policy will not lapse, regardless of the investment
performance of the Separate Account; and

- provides a guaranteed death benefit.

In order to maintain the Rider, certain minimum premium payment tests must be
met on each Policy anniversary and within 48 months following the Date of Issue
and/or the date of any increase in Face Amount. In addition, a one-time
administrative charge of $25 will be deducted from the Policy Value when the
Rider is elected. Certain transactions, including Policy loans, partial
withdrawals, and changes in the Death Benefit Options, can result in the
termination of the Rider. If this Rider is terminated, it cannot be reinstated.

PARTIAL WITHDRAWALS

After the first Policy year, you may make partial withdrawals in a minimum
amount of $500 from the Policy Value. Under Option 1, the Face Amount is reduced
by the amount of the partial withdrawal. A partial withdrawal will not be
allowed under Option 1 if it would reduce the Face Amount below $100,000.

A transaction charge, which is described in CHARGES AND DEDUCTIONS -- "Charges
on Partial Withdrawals," will be assessed to reimburse the Company for the cost
of processing each partial withdrawal. The transaction fee applies to all
partial withdrawals, including a Withdrawal without a surrender charge. A
partial withdrawal charge also may be imposed upon a partial withdrawal.
Generally, amounts withdrawn during each Policy year in excess of 10% of the
Policy Value ("excess withdrawal") are subject to the partial withdrawal charge.
The partial withdrawal charge is equal to 5% of the excess withdrawal up to the
surrender charge on the date of withdrawal. If no surrender charge is applicable
at the time of withdrawal, no partial withdrawal charge will be deducted. The
Policy's outstanding surrender charge will be reduced by the amount of the
partial withdrawal charge deducted. See THE POLICY -- "Partial Withdrawals" and
CHARGES AND DEDUCTIONS -- "Charges on Partial Withdrawals."

LOAN PRIVILEGE

You may borrow against the Policy Value. The total amount you may borrow is the
Loan Value. Loan Value in the first Policy year is 75% of an amount equal to the
Policy Value less surrender charge, Monthly Deductions, and interest on Debt to
the end of the Policy year. Thereafter, Loan Value is 90% of an amount equal to
the Policy Value less the surrender charge.

Policy loans will be allocated among the General Account and the Sub-Accounts in
accordance with your instructions. If no allocation is made by you, the Company
will make a Pro-Rata Allocation among the Accounts. In either case, Policy Value
equal to the Policy loan will be transferred from the appropriate Sub-Accounts
to the General Account, and will earn monthly interest at an effective annual
rate of at least 6%. Therefore, the Policy loan may have a permanent impact on
the Policy Value even though it eventually is repaid. Although the loan amount
is a part of the Policy Value, the Death Proceeds will be reduced by the amount
of outstanding Debt at the time of death.

Policy loans will bear interest at a fixed rate of 8% per year, due and payable
in arrears at the end of each Policy year. If interest is not paid when due, it
will be added to the loan balance. Policy loans may be repaid at any time. You
must notify the Company if a payment is a loan repayment; otherwise, it will be
considered a premium payment. Any partial or full repayment of Debt by you will
be allocated to the General Account or Sub-Accounts in accordance with your
instructions. If you do not specify an allocation, the Company will allocate the
loan repayment in accordance with your most recent premium allocation
instructions. See POLICY LOANS.

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PREFERRED LOAN OPTION

A preferred loan option is available under the Policy. The preferred loan option
will be available upon Written Request. It may be revoked by you at any time. If
this option has been selected, after the tenth Policy anniversary the Policy
Value in the General Account equal to the loan amount will be credited with
interest at an effective annual yield of at least 7.5%. The Company's current
practice is to credit a rate of interest equal to the rate being charged for a
preferred loan, which may be treated as a taxable distribution from the Policy.
See FEDERAL TAX CONSIDERATIONS, "Policy Loans." There is some uncertainty as to
the tax treatment of preferred loans. Consult a qualified tax adviser (and see
FEDERAL TAX CONSIDERATIONS). THE PREFERRED LOAN OPTION MAY NOT BE AVAILABLE IN
ALL STATES.

POLICY LAPSE AND REINSTATEMENT

Except as otherwise provided in the optional Guaranteed Death Benefit Option,
the failure to make premium payments will not cause the Policy to lapse unless:

(a) the Surrender Value is insufficient to cover the next Monthly Deduction
plus loan interest accrued, if any, or

(b) Debt exceeds Policy Value less surrender charges.

A 62-day grace period applies to each situation.

Even if the situation described in (a) above exists, the Policy will not lapse
if you meet the so-called "Minimum Monthly Factor" test. The Minimum Monthly
Factor test is only used to determine whether the Policy will enter the grace
period during the first 48 months or within 48 months following an increase in
the Face Amount. Under the Minimum Monthly Factor test, the Company determines
two amounts:

- the sum of the payments your have made, MINUS any Debt, withdrawals and
withdrawal charges, and

- the amount of the Minimum Monthly Factor (the amount is shown on page 5 of
the Policy) MULTIPLIED by the number of months the Policy has been in
force or the number of months which have elapsed since the last increase
in the Face Amount.

The Company then compares the first amount to the second amount. The Policy will
not enter the grace period if the first amount is greater than the second
amount. If the Policy lapses, it may be reinstated within three years of the
date of default (but not later that the Final Premium Payment Date). In order to
reinstate, you must pay the reinstatement premium and provide satisfactory
Evidence of Insurability subject to our then current underwriting standards. The
Company reserves the right to increase the Minimum Monthly Factor upon
reinstatement. See POLICY TERMINATION AND REINSTATEMENT.

In addition, if the Guaranteed Death Benefit Rider is in effect, the Company
guarantees that the Policy will not lapse, regardless of the investment
performance of the Separate Account. The Policy may lapse, however, under
certain circumstances. See THE POLICY -- "Guaranteed Death Benefit Rider." (This
Rider may not be available in all states.)

POLICY VALUE AND SURRENDER VALUE

The Policy Value is the total amount available for investment under the Policy
at any time. It is the sum of the value of all Accumulation Units in the
Sub-Accounts of the Separate Account and all accumulations in the General
Account of the Company credited to the Policy. The Policy Value reflects the
amount and frequency of Net Premiums paid, charges and deductions imposed under
the Policy, interest credited to accumulations in the General Account,
investment performance of the Sub-Accounts to which Policy Value has been
allocated, and partial withdrawals. The Policy Value may be relevant to the
computation of the Death Proceeds. You bear the entire investment risk for
amounts allocated to the Separate Account. The Company does not guarantee a
minimum Policy Value.

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The Surrender Value will be the Policy Value less any Debt and applicable
surrender charges. The Surrender Value is relevant, for example, to the
continuation of the Policy and in the computation of the amounts available upon
partial withdrawals, Policy loans or surrender.

DEATH PROCEEDS

The Policy provides for the payment of certain Death Proceeds to the named
Beneficiary upon the death of the last surviving Insured. There are no Death
Proceeds payable on death of the first Insured to die. Prior to the Final
Premium Payment Date, the Death Proceeds will be equal to the Sum Insured,
reduced by any outstanding Debt, partial withdrawals, partial withdrawal
charges, and any Monthly Deductions due and not yet deducted through the Policy
month in which the last surviving Insured dies.

Two Sum Insured Options are available. Under Option 1, the Sum Insured is the
greater of the Face Amount of the Policy or the Guideline Minimum Sum Insured.
Under Option 2, the Sum Insured is the greater of the Face Amount of the Policy
plus the Policy Value or the Guideline Minimum Sum Insured. The Guideline
Minimum Sum Insured is equivalent to a percentage (determined each month based
on the younger Insured's Age) of the Policy Value. On or after the Final Premium
Payment Date, the Death Proceeds will equal the Surrender Value. See THE
POLICY -- "Death Proceeds."

The Death Proceeds under the Policy may be received in a lump sum or under one
of the Payment Options described in the Policy. See APPENDIX B -- PAYMENT
OPTIONS.

FLEXIBILITY TO ADJUST SUM INSURED

The minimum increase in Face Amount is $100,000 and any increase also may
require additional Evidence of Insurability satisfactory to the Company. The
increase is subject to a "free-look period" and, during the first 24 months
after the increase, to a conversion privilege. See THE POLICY -- "Free-Look
Period" and "Conversion Privileges."

ADDITIONAL INSURANCE BENEFITS

You have the flexibility to add additional insurance benefits by rider. These
include the Split Option Rider, Other Insured Rider and Four-Year Term Rider.
See APPENDIX A -- OPTIONAL BENEFITS. (All riders may not be available in all
states.)

The cost of these optional insurance benefits will be deducted from the Policy
Value as part of the Monthly Deduction. See CHARGES AND DEDUCTIONS -- "Monthly
Deduction from Policy Value."

PAID-UP INSURANCE OPTION

The Policyowner who elects this option will have, without further premiums due,
joint survivorship insurance coverage for the lifetime of the Insureds, with the
Death Proceeds payable on the death of the last surviving Insured. The
Policyowner who has elected the Paid-Up Insurance option may not pay additional
premiums, select Sum Insured Option 2, increase or decrease the Face Amount or
make partial withdrawals. Policy Value in the Separate Account will be
transferred to the General Account on the date the Company receives Written
Request to exercise the option and transfers of Policy Value back to the
Separate Account will not be permitted. Riders will continue only with the
consent of the Company. Surrender value and loan value are calculated
differently. See THE POLICY -- "Paid-Up Insurance Option." This option may not
be available in all states.

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INVESTMENT OPTIONS

The Policy permits Net Premiums to be allocated either to the Company's General
Account or to the Separate Account. The Separate Account currently is comprised
of 20 Sub-Accounts ("Sub-Accounts"). Each Sub-Account invests exclusively in a
corresponding Underlying Fund of the Allmerica Investment Trust ("Trust")
managed by Allmerica Financial Investment Management Services, Inc., ("AFIMS")
Fidelity Variable Insurance Products Fund ("Fidelity VIP") and Fidelity Variable
Insurance Products Fund II ("Fidelity VIP II") managed by Fidelity Management &
Research Company, T. Rowe Price International Series, Inc. ("T. Rowe Price")
managed by Rowe Price-Fleming International, Inc., with respect to the
International Stock Portfolio, or the Delaware Group Premium Fund ("DGPF")
managed by Delaware International Advisers Ltd. with respect to the
International Equity Series. The Policy permits you to transfer Policy Value
among the available Sub-Accounts and between the Sub-Accounts and the General
Account, subject to certain limitations described under THE POLICY -- "Transfer
Privilege." The Trust, Fidelity VIP, Fidelity VIP II, T. Rowe Price and DGPF are
open-end, diversified series management investment companies. The following
Underlying Funds are available under the Policy:

<TABLE>
<S> <C>
ALLMERICA INVESTMENT TRUST FIDELITY VARIABLE INSURANCE PRODUCTS FUND
Select Aggressive Growth Fund Fidelity VIP Overseas Portfolio
Select Capital Appreciation Fund Fidelity VIP Equity-Income Portfolio
Select Value Opportunity Fund Fidelity VIP Growth Portfolio
Select Emerging Markets Fund Fidelity VIP High Income Portfolio
Select International Equity Fund
Select Growth Fund FIDELITY VARIABLE INSURANCE PRODUCTS FUND II
Select Strategic Growth Fund Fidelity VIP II Asset Manager Portfolio
Core Equity Fund
Equity Index Fund T. ROWE PRICE INTERNATIONAL SERIES, INC.
Select Growth and Income Fund T. Rowe Price International Stock Portfolio
Select Investment Grade Income Fund
Government Bond Fund DELAWARE GROUP PREMIUM FUND
Money Market Fund DGPF International Equity Series
</TABLE>

Certain Funds may not be available in all states.

Each of the Underlying Funds has its own investment objectives. Certain
Underlying Funds, however, have investment objectives similar to certain other
Underlying Funds. The value of each Sub-Account will vary daily depending upon
the performance of the Underlying Fund in which it invests. Each Sub-Account
reinvests dividends or capital gains distributions received from an Underlying
Fund in additional shares of that Underlying Fund. There can be no assurance
that the investment objectives of the Underlying Funds can be achieved.

TAX TREATMENT

The Policy is generally subject to the same federal income tax treatment as a
conventional fixed benefit life insurance policy. Under current tax law, to the
extent there is no change in benefits, you will be taxed on Policy Value
withdrawn from the Policy only to the extent that the amount withdrawn exceeds
the total premiums paid. Withdrawals in excess of premiums paid will be treated
as ordinary income. During the first 15 Policy years, however, an "interest
first" rule applies to any distribution of cash that is required under
Section 7702 of the Code because of a reduction of benefits under the Policy.
Death Proceeds under the Policy are excludable from the gross income of the
Beneficiary, but in some circumstances the Death Proceeds or the Policy Value
may be subject to federal estate tax. See FEDERAL TAX CONSIDERATIONS --
"Taxation of the Policies."

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the Policy. The Policy fails to satisfy the seven-pay test if the cumulative
premiums paid under the Policy at any time during the first seven Policy years,
or within seven years of a material change in the Policy, exceeds the sum of the
net level premiums that would have been paid, had the Policy provided for
paid-up future benefits after the payment of seven level annual premiums. If the
Policy is considered a modified endowment contract, all distributions (including
Policy loans, partial withdrawals, surrenders or assignments) will be taxed on
an "income-first" basis. In addition, with certain exceptions, an additional 10%
penalty will be imposed on the portion of any distribution that is includible in
income. For more information, see FEDERAL TAX CONSIDERATIONS -- "Modified
Endowment Contracts."
------------------------

This Summary is intended to provide only a very brief overview of the more
significant aspects of the Policy. The Prospectus and the Policy provide further
detail. The Policy provides insurance protection for the named beneficiary. The
Policy and its attached application or enrollment form are the entire agreement
between you and the Company.

THE PURPOSE OF THE POLICY IS TO PROVIDE INSURANCE PROTECTION FOR THE
BENEFICIARY. IT MAY NOT BE ADVANTAGEOUS TO PURCHASE FLEXIBLE PREMIUM VARIABLE
LIFE INSURANCE AS A REPLACEMENT FOR YOUR CURRENT LIFE INSURANCE, OR IF YOU
ALREADY OWN A FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY.

NO CLAIM IS MADE THAT THE POLICY IS IN ANY WAY SIMILAR OR COMPARABLE TO A
SYSTEMATIC INVESTMENT PLAN OF A MUTUAL FUND.

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DESCRIPTION OF THE COMPANY, THE SEPARATE ACCOUNT,
AND THE UNDERLYING FUNDS

THE COMPANY

The Company is a life insurance company organized under the laws of Delaware in
July 1974. Its Principal Office is located at 440 Lincoln Street, Worcester,
Massachusetts 01653, Telephone 508-855-1000. As of December 31, 1999, the
Company had over $17 billion in assets and over $26 billion of life insurance in
force. The Company is subject to the laws of the state of Delaware governing
insurance companies and to regulation by the Commissioner of Insurance of
Delaware. In addition, the Company is subject to the insurance laws and
regulations of other states and jurisdictions in which it is licensed to
operate.

Effective October 1, 1995, the Company changed its name from SMA Life Assurance
Company to Allmerica Financial Life Insurance and Annuity Company. The Company
is an indirect wholly owned subsidiary of First Allmerica Financial Life
Insurance Company ("First Allmerica") which, in turn, is a wholly owned
subsidiary of Allmerica Financial Corporation ("AFC"). First Allmerica,
originally organized under the laws of Massachusetts in 1844 as a mutual life
insurance company and known as State Mutual Life Assurance Company of America,
converted to a stock life insurance company and adopted its present name on
October 16, 1995. First Allmerica is the fifth oldest life insurance company in
America.

The Company is a charter member of the Insurance Marketplace Standards
Association ("IMSA"). Companies that belong to IMSA subscribe to a rigorous set
of standards that cover the various aspects of sales and service for
individually sold life insurance and annuities. IMSA members have adopted
policies and procedures that demonstrate a commitment to honesty, fairness and
integrity in all customer contacts involving sales and service of individual
life insurance and annuity products.

THE SEPARATE ACCOUNT

The Separate Account was authorized by vote of the Board of Directors of the
Company on September 15, 1993. The Separate Account is registered with the
Securities and Exchange Commission ("SEC") as a unit investment trust under the
Investment Company Act of 1940 ("1940 Act"). Such registration does not involve
the supervision of its management or investment practices or policies of the
Separate Account or the Company by the SEC.

The assets used to fund the variable portion of the Policies are set aside in
the Separate Account and are kept separate from the general assets of the
Company. Under Delaware law, assets equal to the reserves and other liabilities
of the Separate Account may not be charged with any liabilities arising out of
any other business of the Company. Twenty Sub-Accounts of the Separate Account
are currently offered under the Policy. Each Sub-Account is administered and
accounted for as part of the general business of the Company, but the income,
capital gains, or capital losses of each Sub-Account are allocated to such
Sub-Account, without regard to other income, capital gains, or capital losses of
the Company or the other Sub-Accounts. Each Sub-Account invests exclusively in a
corresponding Underlying Fund of one of the following investment companies:

- Allmerica Investment Trust

- Fidelity Variable Insurance Products Fund

- Fidelity Variable Insurance Products Fund II

- T. Rowe Price International Series, Inc.

- Delaware Group Premium Fund

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generally have no effect on the investment performance of another Underlying
Fund. Shares of each Underlying Fund are not offered to the general public but
solely to separate accounts of life insurance companies, such as the Separate
Account.

Each Sub-Account has two sub-divisions. One sub-division applies to Policies
during their first 15 Policy years, which are subject to a Separate Account
administrative charge. See CHARGES AND DEDUCTIONS -- "Charges Against Assets of
the Separate Account." Thereafter, such Policies are automatically allocated to
the second sub-division to account for the elimination of the Separate Account
administrative charge.

The Company reserves the right, subject to compliance with applicable law, to
change the names of the Sub-Accounts and Separate Account.

THE UNDERLYING FUNDS

Each Underlying Fund pays a management fee to an investment manager or adviser
for managing and providing services to the Underlying Fund. However, management
fee waivers and/or reimbursements may be in effect for certain or all of the
Underlying Funds. For specific information regarding the existence and effect of
any waiver/reimbursements see "CHARGES OF THE UNDERLYING FUNDS" under the
SUMMARY OF FEES AND CHARGES section. The prospectuses of the Underlying Funds
also contain information regarding fees for advisory services and should be read
in conjunction with this prospectus.

ALLMERICA INVESTMENT TRUST

Allmerica Investment Trust ("Trust") is an open-end, diversified management
investment company registered with the SEC under the 1940 Act. Such registration
does not involve supervision by the SEC of the investments or investment policy
of the Trust or its separate investment funds.

The Trust was established by First Allmerica as a Massachusetts business trust
on October 11, 1984, for the purpose of providing a vehicle for the investment
of assets of various separate accounts established by the Company or other
insurance companies. Thirteen investment portfolios of the Trust ("Funds") are
available under the Policy, each issuing a series of shares: the Select
Aggressive Growth Fund, Select Capital Appreciation Fund, Select Value
Opportunity Fund, Select Emerging Markets Fund, Select International Equity
Fund, Select Growth Fund, Select Strategic Growth Fund, Core Equity Fund, Equity
Index Fund, Select Growth and Income Fund, Investment Grade Income Fund,
Government Bond Fund, and Money Market Fund.

Allmerica Financial Investment Management Services, Inc. ("AFIMS") serves as
investment manager of the Trust. AFIMS, which is a wholly-owned subsidiary of
Allmerica Financial, has entered into agreements with other investment managers
("Sub-Advisers"), who manage the investments of the Funds. The Trustees have
responsibility for the supervision of the affairs of the Trust. The Trustees
have entered into a management agreement with AFIMS.

AFIMS, subject to Trustee review, is responsible for the daily affairs of the
Trust and the general management of the Funds. AFIMS performs administrative and
management services for the Trust, furnishes to the Trust all necessary office
space, facilities and equipment, and pays the compensation, if any, of officers
and Trustees who are affiliated with AFIMS.

The Trust bears all expenses incurred in its operation, other than the expenses
AFIMS assumes under the management agreement. Trust expenses include:

- Costs to register and qualify the Trust's shares under the Securities Act
of 1933 ("1933 Act"),

- Other fees payable to the SEC,

- Independent public accountant, legal and custodian fees,

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- Association membership dues, taxes, interest, insurance payments and
brokerage commissions,

- Fees and expenses of the Trustees who are not affiliated with AFIMS,

- Expenses for proxies, prospectuses, reports to shareholders and other
expenses.

Under the Management Agreement with the Trust, AFIMS has entered into agreements
with investment advisers ("Sub-Advisers") selected by AFIMS and Trustees in
consultation with BARRA RogersCasey, Inc. Under each Sub-Adviser Agreement, the
Sub-Adviser is authorized to engage in portfolio transactions on behalf of the
Fund, subject to the Trustee's instructions. The Sub-Advisers (other than
Allmerica Asset Management, Inc.) are not affiliated with the Company or the
Trust.

FIDELITY VARIABLE INSURANCE PRODUCTS FUND

Fidelity Variable Insurance Products Fund ("Fidelity VIP"), managed by Fidelity
Management & Research Company ("FMR"), is an open-end, diversified, management
investment company organized as a Massachusetts business trust on November 13,
1981, and registered with the SEC under the 1940 Act. Four of its investment
portfolios are available under the Policy: Fidelity VIP High Income Portfolio,
Fidelity VIP Equity-Income Portfolio, Fidelity VIP Growth Portfolio and Fidelity
VIP Overseas Portfolio.

Various Fidelity companies perform certain activities required to operate VIP.
FMR is one of America's largest investment management organizations, and has its
principal business address at 82 Devonshire Street, Boston, Massachusetts. It is
composed of a number of different companies which provide a variety of financial
services and products. FMR is the original Fidelity company, founded in 1946. It
provides a number of mutual funds and other clients with investment research and
portfolio management services. The Portfolios of Fidelity VIP, as part of their
operating expenses, pay a monthly management fee to FMR for managing investments
and business affairs. The prospectus of Fidelity VIP contains additional
information concerning the Portfolios, including information concerning
additional expenses paid by the Portfolios, and should be read in conjunction
with this Prospectus.

FIDELITY VARIABLE INSURANCE PRODUCTS FUND II

Fidelity Variable Insurance Products Fund II ("Fidelity VIP II"), managed by FMR
(see discussion under "Variable Insurance Products Fund"), is an open-end,
diversified management investment company organized as a Massachusetts business
trust on March 21, 1988 and is registered with the SEC under the 1940 Act. One
of its investment portfolios is available under the Policy: the Fidelity VIP II
Asset Manager Portfolio. The Portfolios of Fidelity VIP II, as part of their
operating expenses, pay an investment management fee to FMR.

T. ROWE PRICE INTERNATIONAL SERIES, INC.

T. Rowe Price International Series, Inc. ("T. Rowe Price"), managed by Rowe
Price-Fleming International, Inc. ("Price-Fleming"), is an open-end, diversified
management investment company organized in 1994 as a Maryland corporation, and
is registered with the SEC under the 1940 Act. Price-Fleming, founded in 1979 as
a joint venture between T. Rowe Price Associates, Inc. and Robert Fleming
Holdings, Limited, is one of the largest no-load international mutual fund asset
managers, with approximately $42.5 billion (as of December 31, 1999) under
management in its offices in Baltimore, London, Tokyo, Hong Kong, Singapore and
Buenos Aires. One of its investment portfolios is available under the Policies:
the T. Rowe Price International Stock Portfolio. An affiliate of Price-Fleming,
T. Rowe Price Associates, Inc. serves as Sub-Adviser to the Select Capital
Appreciation Fund of the Trust.

DELAWARE GROUP PREMIUM FUND

Delaware Group Premium Fund ("DGPF") is an open-end, diversified management
investment company registered with the SEC under the 1940 Act. Such registration
does not involve supervision by the SEC of the investments or investment policy
of DGPF or its separate investment series. DGPF was established to provide a
vehicle for the investment of assets of various separate accounts supporting
variable insurance policies. One investment portfolio ("Series") is available
under the Policy: the DGPF International Equity Series. The Investment adviser
for the DGPF International Equity Series is Delaware International Advisers Ltd.
("Delaware International").

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INVESTMENT OBJECTIVES AND POLICIES

A summary of investment objectives of each of the Underlying Funds is set forth
below. MORE DETAILED INFORMATION REGARDING THE INVESTMENT OBJECTIVES,
RESTRICTIONS AND RISKS, EXPENSES PAID BY THE UNDERLYING FUNDS AND OTHER RELEVANT
INFORMATION REGARDING THE UNDERLYING INVESTMENT COMPANIES MAY BE FOUND IN THEIR
RESPECTIVE PROSPECTUSES, WHICH ACCOMPANY THIS PROSPECTUS AND SHOULD BE READ
CAREFULLY BEFORE INVESTING. The statements of additional information of the
Underlying Funds are available upon request. There can be no assurance that the
investment objectives of the Underlying Funds can be achieved.

SELECT AGGRESSIVE GROWTH FUND -- seeks above-average capital appreciation by
investing primarily in common stocks of companies which are believed to have
significant potential for capital appreciation.

SELECT CAPITAL APPRECIATION FUND -- seeks long-term growth of capital.
Realization of income is not a significant investment consideration and any
income realized on the Fund's investments will be incidental to its primary
objective. The Fund invests primarily in common stock of industries and
companies which are believed to be experiencing favorable demand for their
products and services, and which operate in a favorable competitive environment
and regulatory climate.

SELECT VALUE OPPORTUNITY FUND -- seeks long-term growth of capital by investing
primarily in a diversified portfolio of common stocks of small and mid-size
companies, whose securities at the time of purchase are considered by the
Sub-Adviser to be undervalued.

SELECT EMERGING MARKETS FUND -- seeks long-term growth of capital by investing
in the world's emerging markets.

SELECT INTERNATIONAL EQUITY FUND -- seeks maximum long-term total return
(capital appreciation and income) primarily by investing in common stocks of
established non-U.S. companies.

DGPF INTERNATIONAL EQUITY SERIES -- seeks long-term growth without undue risk to
principal by investing primarily in equity securities of foreign issuers
providing the potential for capital appreciation and income.

FIDELITY VIP OVERSEAS PORTFOLIO -- seeks long-term growth of capital primarily
through investments in foreign securities and provides a means for aggressive
investors to diversify their own portfolios by participating in companies and
economies outside of the United States.

T. ROWE PRICE INTERNATIONAL STOCK PORTFOLIO -- seeks long-term growth of capital
through investments primarily in common stocks of established, non-U.S.
companies.

SELECT GROWTH FUND -- seeks to achieve long-term growth of capital by investing
in a diversified portfolio consisting primarily of common stocks selected on the
basis of their long-term growth potential.

SELECT STRATEGIC GROWTH FUND -- seeks long-term growth of capital by investing
primarily in common stocks of established companies.

CORE EQUITY FUND -- is invested in common stocks and securities convertible into
common stocks that are believed to represent significant underlying value in
relation to current market prices. The objective of the Core Equity Fund is to
achieve long-term growth of capital. Realization of current investment income,
if any, is incidental to this objective.

FIDELITY VIP 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. Capital appreciation also may be found
in other types of securities, including bonds and preferred stocks.

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EQUITY INDEX FUND -- seeks to provide investment results that correspond to the
aggregate price and yield performance of a representative selection of United
States publicly traded common stocks. The Equity Index Fund seeks to achieve its
objective by attempting to replicate the aggregate price and yield performance
of the S&P 500 Stocks.

FIDELITY VIP EQUITY-INCOME PORTFOLIO -- seeks reasonable income by investing
primarily in income-producing equity securities. In choosing these securities,
the Portfolio also will consider the potential for capital appreciation. The
Portfolio's goal is to achieve a yield which exceeds the composite yield on the
securities comprising the S&P 500. The Portfolio may invest in high yielding,
lower-rated fixed-income securities (commonly referred to as "junk bonds") which
are subject to greater risk than investments in higher-rated securities. See
"Risks of Lower-Rated Debt Securities" in the Fidelity VIP prospectus.

FIDELITY VIP II ASSET MANAGER PORTFOLIO -- seeks high total return with reduced
risk over the long term by allocating its assets among domestic and foreign
stocks, bonds and short-term money market instruments.

FIDELITY VIP HIGH INCOME PORTFOLIO -- seeks to obtain a high level of current
income by investing primarily in high-yielding, lower-rated fixed-income
securities (commonly referred to as "junk bonds"), while also considering growth
of capital. These securities often are considered to be speculative, and involve
greater risk of default or price changes than securities assigned a high quality
rating. See "Risks of Lower-Rated Debt Securities" in the Fidelity VIP
prospectus.

SELECT INVESTMENT GRADE INCOME FUND -- is invested in a diversified portfolio of
fixed income securities with the objective of seeking as high a level of total
return (including both income and capital appreciation) as is consistent with
prudent investment management.

GOVERNMENT BOND FUND -- has the investment objectives of seeking high income,
preservation of capital and maintenance of liquidity, primarily through
investments in debt instruments issued or guaranteed by the U.S. Government or
its agencies or instrumentalities, and in related options, futures and
repurchase agreements.

MONEY MARKET FUND -- is invested in a diversified portfolio of high-quality,
short-term money market instruments with the objective of obtaining maximum
current income consistent with the preservation of capital and liquidity.

CERTAIN UNDERLYING FUNDS HAVE INVESTMENT OBJECTIVES AND/OR POLICIES SIMILAR TO
THOSE OF OTHER UNDERLYING FUNDS. THEREFORE, TO CHOOSE THE SUB-ACCOUNTS WHICH
BEST WILL MEET YOUR NEEDS AND OBJECTIVES, CAREFULLY READ THE PROSPECTUSES OF THE
TRUST, FIDELITY VIP, FIDELITY VIP II, T. ROWE PRICE AND DGPF, ALONG WITH THIS
PROSPECTUS. IN SOME STATES, INSURANCE REGULATIONS MAY RESTRICT THE AVAILABILITY
OF PARTICULAR SUB-ACCOUNTS.

If required in your state, in the event of a material change in the investment
Policy of a Sub-Account or the Underlying Fund in which it invests, you will be
notified of the change. If you have Policy Value in that Sub-Account, the
Company will transfer it without charge on written request within sixty (60)
days of the later of (1) the effective date of such change in the investment
policy, or (2) your receipt of the notice of the right to transfer. You may then
change the percentages of your premium and deduction allocations.

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ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS

The Company reserves the right, subject to applicable law, to make additions to,
deletions from, or substitutions for the shares that are held in the
Sub-Accounts or that the Sub-Accounts may purchase. If the shares of any
Underlying Fund are no longer available for investment or if in the Company's
judgment further investment in any Underlying Fund should become inappropriate
in view of the purposes of the Separate Account or the affected Sub-Account, the
Company may redeem the shares of that Underlying Fund and substitute shares of
another registered open-end management company. The Company will not substitute
any shares attributable to the Policy interest in a Sub-Account without notice
to you and prior approval of the SEC and state insurance authorities, to the
extent required by the 1940 Act or other applicable law. The Separate Account
may, to the extent permitted by law, purchase other securities for other
policies or permit a conversion between policies upon request by the
Policyowner.

The Company also reserves the right to establish additional Sub-Accounts of the
Separate Account, each of which would invest in shares corresponding to a new
Underlying Fund or in shares of another investment company. Subject to
applicable law and any required SEC approval, the Company may, in its sole
discretion, establish new Sub-Accounts or eliminate one or more Sub-Accounts if
marketing needs, tax considerations or investment conditions warrant. Any new
Sub-Accounts may be made available to existing Policyowners on a basis to be
determined by the Company.

Shares of the Funds of the Trust are also issued to separate accounts of the
Company and its affiliates which issue variable annuity contracts ("mixed
funding"). Shares of the Portfolios of Fidelity VIP, Fidelity VIP II, T. Rowe
Price and the DGPF Series are also issued to other unaffiliated insurance
companies ("shared funding"). It is conceivable that in the future such mixed
funding or shared funding may be disadvantageous for variable life Policyowners
or variable annuity Policyowners. Although the Company and the Underlying Funds
do not currently foresee any such disadvantages, the Company and the respective
Trustees intend to monitor events in order to identify any material conflicts
and to determine what action, if any, should be taken. If the Trustees were to
conclude that separate funds should be established for variable life and
variable annuity separate accounts, the Company will bear the expenses.

If any of these substitutions or changes is made, the Company may by endorsement
change the Policy to reflect the substitution or change and will notify
Policyowners of all such changes. If the Company deems it to be in the best
interest of Policyowners, and subject to any approvals that may be required
under applicable law, the Separate Account or any Sub-Accounts may be operated
as a management company under the 1940 Act, may be deregistered under the 1940
Act if registration is no longer required, or may be combined with other
Sub-Accounts or other separate accounts of the Company.

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THE POLICY

APPLYING FOR THE POLICY

The Policy cannot be issued until the underwriting procedure has been completed.
Upon receipt at its Principal Office of a completed application from a
prospective Policyowner, the Company will follow certain insurance underwriting
procedures designed to determine whether the proposed Insured is insurable. This
process may involve medical examinations, and may require that further
information be provided by the proposed Policyowner before a determination of
insurability can be made. The Company reserves the right to reject an
application which does not meet its underwriting guidelines, but in underwriting
insurance, the Company complies with all applicable federal and state
prohibitions concerning unfair discrimination.

CONDITIONAL INSURANCE AGREEMENT

It is possible to obtain life insurance protection during the underwriting
process through a Conditional Insurance Agreement. If at the time of application
you make a payment equal to at least one "Minimum Monthly Factor" for the Policy
as applied for, the Company will provide fixed conditional insurance in the
amount of insurance applied for up to a maximum of $500,000, subject to the
terms of the Conditional Insurance Agreement, pending underwriting approval.
This coverage generally will continue for a maximum of 90 days from the date of
the application or the completion of a medical exam, should one be required. In
no event will any insurance proceeds be paid under the Conditional Insurance
Agreement if death is by suicide.

If the application is approved, the Policy will be issued as of the date the
terms of the Conditional Insurance Agreement were met. If no Conditional
Insurance Agreement is in effect because the prospective Policyowner does not
wish to make any payment until the Policy is issued or has paid an initial
premium that is not sufficient to place the Policy in force, upon delivery of
the Policy the Company will require payment of sufficient premium to place the
insurance in force.

PREMIUMS HELD IN THE GENERAL ACCOUNT PENDING UNDERWRITING APPROVAL

Pending completion of insurance underwriting and Policy issuance procedures, the
initial premium will be held in the Company's General Account. If the
application is approved and the Policy is issued and accepted by you, the
initial premium held in the General Account will be credited with interest at a
specified rate, beginning not later than the date of receipt of the premium at
the Principal Office. IF THE POLICY IS NOT ISSUED, THE PREMIUMS WILL BE RETURNED
TO YOU WITHOUT INTEREST.

FREE-LOOK PERIOD

The Policy provides for an initial "free-look" period. You may cancel the Policy
by mailing or delivering the Policy to the Principal Office or an agent of the
Company on or before the latest of:

- 45 days after the application for the Policy are signed, or

- 10 days after you receive the Policy (or longer if required by state law),
or

- 10 days after the Company mails or personally delivers a notice of
withdrawal rights to you.

When you return the Policy, the Company will mail a refund to you within seven
days. The refund of any premium paid by check, however, may be delayed until the
check has cleared your bank.

Where required by state law, the refund will equal the premiums paid. In all
other states, the refund will equal the sum of:

(1) the difference between the premiums, including fees and charges paid, and
any amounts allocated to the Separate Account, PLUS

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(2) the value of the amounts allocated to the Separate Account, PLUS

(3) any fees or charges imposed on the amounts allocated to the Separate
Account.

The amount refunded in (1) above includes any premiums allocated to the General
Account.

FREE LOOK WITH FACE AMOUNT INCREASES

After an increase in the Face Amount, the Company will mail or personally
deliver a notice of a "free look" with respect to the increase. You will have
the right to cancel the increase before the latest of:

- 45 days after the application for the increase is signed, or

- 10 days after you receive the new specification pages issued for the
increase (or longer if required by state law), or

- 10 days after the Company mails or delivers a notice of withdrawal rights
to you.

Upon canceling the increase, you will receive a credit to the Policy Value of
charges which would not have been deducted but for the increase. The amount to
be credited will be refunded if you so request. The Company also will waive any
surrender charge calculated for the increase.

CONVERSION PRIVILEGES

Once during the first 24 months after the Date of Issue or after the effective
date of an increase in Face Amount (assuming the Policy is in force), you may
convert your Policy without Evidence of Insurability to a flexible premium
adjustable life insurance policy with fixed and guaranteed minimum benefits.
Assuming that there have been no increases in the initial Face Amount, you can
accomplish this within 24 months after the Date of Issue by transferring,
without charge, the Policy Value in the Separate Account to the General Account
and by simultaneously changing your premium allocation instructions to allocate
future premium payments to the General Account. Within 24 months after the
effective date of each increase, you can transfer, without charge, all or part
of the Policy Value in the Separate Account to the General Account and
simultaneously change your premium allocation instructions to allocate all or
part of future premium payments to the General Account.

Where required by state law, at your request the Company will issue a flexible
premium adjustable life insurance policy to you. The new policy will have the
same Face Amount, Issue Ages, Date of Issue, and Premium Class as the original
Policy.

PREMIUM PAYMENTS

Premium payments are payable to the Company, and may be mailed to the Principal
Office or paid through one of the Company's authorized agents. All premium
payments after the initial premium payment are credited to the Separate Account
or the General Account as of date of receipt at the Principal Office.

PREMIUM FLEXIBILITY

Unlike conventional insurance policies, the Policy does not obligate you to pay
premiums in accordance with a rigid and inflexible premium schedule. You may
establish a schedule of planned premiums which will be billed by the Company at
regular intervals. Failure to pay planned premiums, however, will not itself
cause the Policy to lapse.

You also may make unscheduled premium payments at any time prior to the Final
Premium Payment Date or skip planned premium payments, subject to the maximum
and minimum premium limitations described below.

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You also may elect to pay premiums by means of a monthly automatic payment
procedure. Under such procedure, amounts will be deducted from your checking
account each month, generally on the Monthly Payment Date, and applied as a
premium under the Policy. The minimum payment permitted under such procedure is
$50.

Premiums are not limited as to frequency and number. No premium payment may be
less than $100, however, without the Company's consent. Moreover, premium
payments must be sufficient to provide a positive Surrender Value at the end of
each Policy month, or the Policy may lapse. See POLICY TERMINATION AND
REINSTATEMENT.

MINIMUM MONTHLY FACTOR

- Debt does not exceed Policy Value less surrender charges, then

- the Policy is guaranteed not to lapse during that period.

EXCEPT FOR THE 48 POLICY MONTH PERIODS, MAKING MONTHLY PAYMENTS AT LEAST EQUAL
TO THE MINIMUM MONTHLY FACTOR DOES NOT GUARANTEE THAT THE POLICY WILL REMAIN IN
FORCE.

In no event may the total of all premiums paid exceed the current maximum
premium limitations set forth in the Policy which are required by federal tax
laws. These maximum premium limitations will change whenever there is any change
in the Face Amount, the addition or deletion of a rider, or a change in the Sum
Insured Option. If a premium is paid which would result in total premiums
exceeding the current maximum premium limitations, the Company will accept only
that portion of the premiums which shall make total premiums equal the maximum.
Any part of the premiums in excess of that amount will be returned, and no
further premiums will be accepted until allowed by the current maximum premium
limitation prescribed by Internal Revenue Service ("IRS") rules. Notwithstanding
the current maximum premium limitations, however, the Company will accept a
premium which is needed in order to prevent a lapse of the Policy during a
Policy year. See POLICY TERMINATION AND REINSTATEMENT.

INCENTIVE FUNDING DISCOUNT

The Company will lower the cost of insurance charges by 5% during any Policy
year for which you qualify for an incentive funding discount. To qualify, total
premiums paid under the Policy, less any Debt, withdrawals and withdrawal
charges, and transfers from other policies issued by the Company, must exceed
90% of the guideline level premiums (as defined in Section 7702 of the Code)
accumulated from the Date of Issue to the date of qualification. The incentive
funding discount is not available in all states.

The amount needed to qualify for the incentive funding discount is determined on
the Date of Issue for the first Policy year and on each Policy anniversary for
each subsequent Policy year. If the Company receives the proceeds from a policy
issued by an unaffiliated company to be exchanged for the Policy, however, the
qualification for the incentive funding discount for the first Policy year will
be determined on the date the proceeds are received by the Company, and only
insurance charges becoming due after the date such proceeds are received will be
eligible for the incentive funding discount.

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GUARANTEED DEATH BENEFIT RIDER (MAY NOT BE AVAILABLE IN ALL STATES)

An optional Guaranteed Death Benefit Rider is available only at issue of the
Policy. If this Rider is in effect, the Company:

- guarantees that the Policy will not lapse, regardless of the investment
performance of the Separate Account, and

- provides a guaranteed death benefit.

In order to maintain the Guaranteed Death Benefit Rider, certain minimum premium
payment tests must be met on each Policy anniversary and within 48 months
following the Date of Issue and/or the date of any increase in the Face Amount,
as described below. In addition, a one-time administrative charge of $25 will be
deducted from the Policy Value when the Rider is elected. Certain transactions,
including Policy loans, partial withdrawals, and changes in Sum Insured Options,
can result in the termination of the Rider. If this Rider is terminated, it
cannot be reinstated.

GUARANTEED DEATH BENEFIT TESTS

While the Guaranteed Death Benefit Rider is in effect, the Policy will not lapse
if the following two tests are met:

1. Within 48 months following the Date of Issue of the Policy or of any
increase in the Face Amount, the sum of the premiums paid, less any debt,
partial withdrawals and withdrawal charges, must be greater than the Minimum
Monthly Factors (if any) multiplied by the number of months which have
elapsed since the Date of Issue or the effective date of increase; and

2. On each Policy anniversary, (a) must exceed (b) where, since the Date of
Issue:

(a) is the sum of your premiums, less any withdrawals, partial withdrawal
charges and Debt which is classified as a preferred loan; and

(b) is the sum of the minimum guaranteed Death Benefit premiums, as shown on
the specifications page of the Policy.

GUARANTEED DEATH BENEFIT RIDER

If the Guaranteed Death Benefit Rider is in effect on the Final Premium Payment
Date, guaranteed Death Proceeds will be provided as long as the Rider is in
force. The Death Proceeds will be the greater of:

- the Face Amount as of the Final Premium Payment Date; or

- the Policy Value as of the date due proof of death is received by the
Company.

TERMINATION OF THE GUARANTEED DEATH BENEFIT RIDER

The Guaranteed Death Benefit Rider will end and may not be reinstated on the
first to occur of the following:

- foreclosure of a Policy loan, or

- the date on which the sum of your payments does not meet or exceed the
applicable Guaranteed Death Benefit test (above), or

- any Policy change that results in a negative guideline level premium, or

- the effective date of a change from Sum Insured Option 2 to Sum Insured
Option 1, if such change occurs within five Policy years of the Final
Premium Payment Date, or

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- a request for a partial withdrawal or preferred loan is made after the
Final Premium Payment Date.

It is possible that the Policy Value will not be sufficient to keep the Policy
in force on the first Monthly Payment Date following the date the Rider
terminates. The net amount payable to keep the Policy in force will never exceed
the surrender charge plus three Monthly Deductions.

PAID-UP INSURANCE OPTION

Upon Written Request, the Policyowner may exercise a paid-up insurance option.
Paid-up life insurance is fixed insurance, usually having a reduced Face Amount,
for the lifetime of the insured with no further premiums due. If the Policyowner
elects this option, certain Policyowner rights and benefits may be limited.

The paid-up fixed insurance will be in the amount, up to the Face Amount of the
Policy, that the Surrender Value of the Policy can purchase for a net single
premium at the Insureds' Ages and Premium Class on the date this option is
elected. The Company will transfer any Policy Value in the Separate Account to
the General Account on the date it receives the written request to elect the
option. If the Surrender Value exceeds the net single premium necessary for the
fixed insurance, the Company will pay the excess to the Policyowner. The net
single premium is based on the Commissioners 1980 Standard Ordinary Mortality
Tables, Smoker or Non-Smoker, Male, Female (or Table B for unisex policies) with
increases in the tables for non-standard risks. Interest will not be less than
4.5%.

IF THE PAID-UP INSURANCE OPTION IS ELECTED, THE FOLLOWING
POLICYOWNER RIGHTS AND BENEFITS WILL BE AFFECTED:

- As described above, the paid-up insurance benefit is computed differently
from the Net Death Benefit, and the death benefit options will not apply.

- The Company will transfer the Policy Value in the Separate Account to the
General Account on the date it receives the Written Request to elect the
option. The Company will not allow transfers of Policy Value from the
General Account back to the Separate Account.

- The Policyowner may not make further premium payments.

- The Policyowner may not increase or decrease the Face Amount or make
partial withdrawals. Riders will continue only with the Company's consent.

After electing paid-up fixed insurance, the Policyowner may surrender the Policy
for its net cash value. The cash value is equal to the net single premium for
paid-up insurance at the Insureds' Ages. The net cash value is the cash value
less any outstanding loans.

ALLOCATION OF NET PREMIUMS

The Net Premium equals the premium paid less the tax expense charge and the
premium expense charge. In the application for the Policy, you indicate the
initial allocation of Net Premiums among the General Account and the
Sub-Accounts of the Separate Account. You may allocate premiums to one or more
Sub-Accounts, but may not have Policy Value in more than 20 Sub-Accounts at any
one time. The minimum amount which may be allocated to a Sub-Account is 1% of
Net Premium paid. Allocation percentages must be in whole numbers (for example,
33 1/3% may not be chosen) and must total 100%.

FUTURE CHANGES ALLOWED

You may change the allocation of future Net Premiums at any time pursuant to
written or telephone request. An allocation change will be effective as of the
date of receipt of the notice at the Principal Office. Currently,

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no charge is imposed for changing premium allocation instructions. The Company
reserves the right to impose such a charge in the future, but guarantees that
the charge will not exceed $25.

If allocation changes by telephone are elected by the Policyowner, a properly
completed authorization form must be on file before telephone requests will be
honored. The policy of the Company and its agents and affiliates is that they
will not be responsible for losses resulting from acting upon telephone requests
reasonably believed to be genuine. The Company will employ reasonable procedures
to confirm that instructions communicated by telephone are genuine; otherwise,
the Company may be liable for any losses due to unauthorized or fraudulent
instructions. Such procedures may include, among other things, requiring some
form of personal identification prior to acting upon instructions received by
telephone. All transfer instructions by telephone are tape recorded.

INVESTMENT RISK

The Policy Value in the Sub-Accounts will vary with their investment experience;
you bear this investment risk. The investment performance may affect the Death
Proceeds as well. Policyowners periodically should review their allocations of
premiums and Policy Value in light of market conditions and overall financial
planning requirements.

TRANSFER PRIVILEGE

Subject to the Company's then current rules, you may at any time transfer the
Policy Value among the Sub-Accounts or between a Sub-Account and the General
Account. However, the Policy Value held in the General Account to secure a
Policy loan may not be transferred.

All requests for transfers must be made to the Principal Office. The amount
transferred will be based on the Policy Value in the Accounts next computed
after receipt of the transfer order. The Company will make transfers pursuant to
written or telephone request. As discussed in THE POLICY -- "Allocation of Net
Premiums," a properly completed authorization form must be on file at the
Principal Office before telephone requests will be honored.

Currently, transfers to and from the General Account are permitted only if:

- there has been at least a 90-day period since the last transfer from the
General Account, and

- the amount transferred from the General Account in each transfer does not
exceed the lesser of $100,000, or 25% of the Accumulated Value under the
Policy.

These rules are subject to change by the Company.

DOLLAR-COST AVERAGING OPTION AND AUTOMATIC REBALANCING OPTION

You may have automatic transfers of at least $100 a month made on a periodic
basis:

- from the Sub-Accounts which invest in the Money Market Fund and Government
Bond Fund of the Trust, respectively, to one or more of the other
Sub-Accounts ("Dollar-Cost Averaging Option"), or

- to reallocate Policy Value among the Sub-Accounts ("Automatic Rebalancing
Option").

Automatic transfers may be made on a monthly, bi-monthly, quarterly, semi-annual
or annual schedule. Generally, all transfers will be processed on the 15th of
each scheduled month. If the 15th is not a business day, however, or is the
Monthly Payment Date, the automatic transfer will be processed on the next
business day. The Dollar-Cost Averaging Option and the Automatic Rebalancing
Option may not be in effect at the same time.

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TRANSFER PRIVILEGE SUBJECT TO POSSIBLE LIMITS

The transfer privilege is subject to the Company's consent. The Company reserves
the right to impose limitations on transfers including, but not limited to:

- the minimum amount that may be transferred,

- the minimum amount that may remain in a Sub-Account following a transfer
from that Sub-Account,

- the minimum period of time between transfers involving the General
Account, and

- the maximum amount that may be transferred each time from the General
Account.

Currently, the first 12 transfers in a Policy year will be free of any charge.
Thereafter, a $10 transfer charge will be deducted from the amount transferred
for each transfer in that Policy year. The Company may increase or decrease this
charge, but it is guaranteed never to exceed $25. The first automatic transfer
counts as one transfer towards the 12 free transfers allowed in each Policy
year; each subsequent automatic transfer is without charge and does not reduce
the remaining number of transfers which may be made free of charge. Any
transfers made with respect to a conversion privilege, Policy loan or material
change in investment policy will not count towards the 12 free transfers.

DEATH PROCEEDS

The Policy provides two death benefit options: The Option 1 and the Option 2
(for more information, see SUM INSURED OPTIONS). The Policy provides for the
payment of the Death Proceeds under the applicable death benefit option to the
named Beneficiary on the death of the last surviving Insured. There are no Death
Proceeds payable on the death of the first Insured to die. Within 90 days of the
death of the first Insured to die, or as soon thereafter as is reasonably
possible, due proof of such death must be received at the Principal Office. As
long as the Policy remains in force (see POLICY TERMINATION AND REINSTATEMENT),
the Company will pay the Death Proceeds to the named Beneficiary, upon due proof
of the death of the last surviving Insured.

The Company will normally pay the Death Proceeds within seven days of receiving
due proof of the death of the last surviving Insured, but the Company may delay
payments under certain circumstances. See OTHER POLICY PROVISIONS --
"Postponement of Payments." The Death Proceeds may be received by the
Beneficiary in cash or under one or more of the payment options set forth in the
Policy. See APPENDIX B -- PAYMENT OPTIONS.

Prior to the Final Premium Payment Date, the Death Proceeds are:

- the Sum Insured provided under Option 1 or Option 2, whichever is elected
and in effect on the date of death of the last surviving Insured; plus

- any additional insurance on the Insureds' lives that is provided by rider;
minus

- any outstanding Debt, any partial withdrawals and partial withdrawal
charges, and any Monthly Deductions due and unpaid through the Policy
month in which the last surviving Insured dies.

After the Final Premium Payment Date, the Death Proceeds equal the Surrender
Value of the Policy. The amount of Death Proceeds payable will be determined as
of the date the Company receives due proof of death of the last surviving
Insured for Option 2 and date of death of the last surviving Insured for
Option 1.

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<PAGE>
SUM INSURED OPTIONS

The Policy provides two Sum Insured Options: Option 1 and Option 2, as described
below. You designate the desired Sum Insured Option in the applications. You may
change the option once per Policy year by Written Request. There is no charge
for a change in option.

Under Option 1, the Sum Insured is equal to the greater of the Face Amount of
insurance or the Guideline Minimum Sum Insured. Under Option 2, the Sum Insured
is equal to the greater of the Face Amount of insurance plus the Policy Value or
the Guideline Minimum Sum Insured.

GUIDELINE MINIMUM SUM INSURED

The Guideline Minimum Sum Insured is equal to a percentage of the Policy Value
as set forth in the first Table below (for all Policies issued in Pennsylvania
and for certain other Policies* described below, Table 2 applies). The Guideline
Minimum Sum Insured is determined in accordance with Code regulations to ensure
that the Policy qualifies as a life insurance contract and that the insurance
proceeds will be excluded from the gross income of the Beneficiary.

GUIDELINE MINIMUM SUM INSURED -- TABLE 1
(AGE OF YOUNGER INSURED ON DEATH OF LAST SURVIVING INSURED)

<TABLE>
<CAPTION>
Age Percentage Age Percentage
- --- ---------- --- ----------
<S> <C> <C> <C>
Under 60...................... 300% 78............................ 180%
60............................ 300% 79............................ 173%
61............................ 293% 80............................ 167%
62............................ 286% 81............................ 163%
63............................ 279% 82............................ 159%
64............................ 272% 83............................ 155%
65............................ 265% 84............................ 151%
66............................ 258% 85............................ 147%
67............................ 251% 86............................ 143%
68............................ 244% 87............................ 139%
69............................ 237% 88............................ 135%
70............................ 230% 89............................ 130%
71............................ 223% 90............................ 125%
72............................ 217% 91............................ 120%
73............................ 211% 92............................ 115%
74............................ 205% 93............................ 110%
75............................ 198% 94............................ 105%
76............................ 192% 95............................ 100%
77............................ 186% Over 95....................... 100%
</TABLE>

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<PAGE>
For all Policies issued in Pennsylvania and for certain other Policies*
described below, GUIDELINE MINIMUM SUM INSURED -- TABLE 2 applies, as follows:

GUIDELINE MINIMUM SUM INSURED -- TABLE 2
(AGE OF YOUNGER INSURED ON DEATH OF LAST SURVIVING INSURED)

<TABLE>
<CAPTION>
Age Percentage Age Percentage
- --- ---------- --- ----------
<S> <C> <C> <C>
Thru 40....................... 250% 61............................ 128%
41............................ 243% 62............................ 126%
42............................ 236% 63............................ 124%
43............................ 229% 64............................ 122%
44............................ 222% 65............................ 120%
45............................ 215% 66............................ 119%
46............................ 209% 67............................ 118%
47............................ 203% 68............................ 117%
48............................ 197% 69............................ 116%
49............................ 191% 70............................ 115%
50............................ 185% 71............................ 113%
51............................ 178% 72............................ 111%
52............................ 171% 73............................ 109%
53............................ 164% 74............................ 107%
54............................ 157% 75 thru 90.................... 105%
55............................ 150% 91............................ 104%
56............................ 146% 92............................ 103%
57............................ 142% 93............................ 102%
58............................ 138% 94............................ 101%
59............................ 134% 95............................ 100%
60............................ 130%
</TABLE>

* For a period of 90 days after a state insurance department has approved the
use of GUIDELINE MINIMUM SUM INSURED -- TABLE 2, the Company will permit
Policyowners in that state to endorse the Policy to elect GUIDELINE MINIMUM SUM
INSURED -- TABLE 2. After a state insurance department has approved its use, all
new Policies issued in that state will utilize GUIDELINE MINIMUM SUM INSURED --
TABLE 2.

Under both Option 1 and Option 2 the Sum Insured provides insurance protection.
Under Option 1, the Sum Insured remains level unless the applicable percentage
of Policy Value under Guideline Minimum Sum Insured exceeds the Face Amount, in
which case the Sum Insured will vary as the Policy Value varies. Under Option 2,
the Sum Insured varies as the Policy Value changes.

For any Face Amount, the amount of the Sum Insured and the Death Proceeds will
be greater under Option 2 than under Option 1, since the Policy Value is added
to the specified Face Amount and included in the Death Proceeds only under
Option 2. However, the cost of insurance included in the Monthly Deduction will
be greater, and thus the rate at which Policy Value will accumulate will be
slower, under Option 2 than under Option 1 (assuming the same specified Face
Amount and the same actual premiums paid). See CHARGES AND DEDUCTIONS --
"Monthly Deduction from Policy Value."

If the Policyowner desires to have premium payments and investment performance
reflected in the amount of the Sum Insured, the Policyowner should choose
Option 2. If the Policyowner desires premium payments and investment performance
reflected to the maximum extent in the Policy Value, you should select
Option 1.

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<PAGE>
ILLUSTRATIONS

For purposes of this illustration, assume that the younger Insured is under the
Age of 40, that there is no outstanding Debt, and that GUIDELINE MINIMUM SUM
INSURED -- TABLE 1 applies.

ILLUSTRATION OF OPTION 1

Under Option 1, a Policy with a $300,000 Face Amount will generally have a Sum
Insured equal to $300,000. However, because the Sum Insured must be equal to or
greater than 300% of Policy Value, if at any time the Policy Value exceeds
$100,000, the Sum Insured will exceed the $300,000 Face Amount. In this example,
each additional dollar of Policy Value above $100,000 will increase the Sum
Insured by $3.00. For example, a Policy with a Policy Value of $125,000 will
have a Guideline Minimum Sum Insured of $375,000 ($125,000 X 3.00); Policy Value
of $150,000 will produce a Guideline Minimum Sum Insured of $450,000 ($150,000 X
3.00); and Policy Value of $200,000 will produce a Guideline Minimum Sum Insured
of $600,000 ($200,000 X 3.00).

Similarly, so long as Policy Value exceeds $100,000, each dollar taken out of
Policy Value will reduce the Sum Insured by $3.00. If, for example, the Policy
Value is reduced from $125,000 to $100,000 because of partial withdrawals,
charges or negative investment performance, the Sum Insured will be reduced from
$375,000 to $300,000. If at any time, however, the Policy Value multiplied by
the applicable percentage is less than the Face Amount, the Sum Insured will
equal the Face Amount of the Policy.

The applicable percentage becomes lower as the younger Insured's Age increases.
If the younger Insured's Age in the above example were, for example, 70 (rather
than between 0 and 40), the applicable percentage would be 230%. The Sum Insured
would not exceed the $300,000 Face Amount unless the Policy Value exceeded
$130,436 (rather than $100,000), and each dollar then added to or taken from
Policy Value would change the Sum Insured by $2.30.

ILLUSTRATION OF OPTION 2

For purposes of this illustration, assume that the younger Insured is under the
Age of 40 and that there is no outstanding Debt, and that GUIDELINE MINIMUM
INSURED -- TABLE 1 applies.

Under Option 2, a Policy with a Face Amount of $300,000 will generally produce a
Sum Insured of $300,000 plus Policy Value. For example, a Policy with Policy
Value of $50,000 will produce a Sum Insured of $350,000 ($300,000 + $50,000);
Policy Value of $80,000 will produce a Sum Insured of $380,000 ($300,000 +
$80,000); Policy Value of $100,000 will produce a Sum Insured of $400,000
($300,000 + $100,000). However, the Sum Insured must be at least 300% of the
Policy Value. Therefore, if the Policy Value is greater than $150,000, 300% of
that amount will be the Sum Insured, which will be greater than the Face Amount
plus Policy Value. In this example, each additional dollar of Policy Value above
$150,000 will increase the Sum Insured by $3.00. For example, if the Policy
Value is $200,000, the Guideline Minimum Sum Insured will be $600,000 ($200,000
X 3.00); Policy Value of $250,000 will produce a Guideline Minimum Sum Insured
of $750,000 ($250,000 X 3.00); and Policy Value of $300,000 will produce a
Guideline Minimum Sum Insured of $900,000 ($300,000 X 3.00).

Similarly, if Policy Value exceeds $150,000, each dollar taken out of Policy
Value will reduce the Sum Insured by $3.00. If, for example, the Policy Value is
reduced from $200,000 to $150,000 because of partial withdrawals, charges or
negative investment performance, the Sum Insured will be reduced from $600,000
to $450,000. If at any time, however, Policy Value multiplied by the applicable
percentage is less than the Face Amount plus Policy Value, then the Sum Insured
will be the current Face Amount plus Policy Value.

The applicable percentage becomes lower as the younger Insured's Age increases.
If the Insured's Age in the above example were 70, the applicable percentage
would be 230%, so that the Sum Insured must be at least 2.30 times the Policy
Value. The amount of the Sum Insured would be the sum of the Policy Value plus
$300,000 unless the Policy Value exceeded $230,769 (rather than $150,000). Each
dollar added to or subtracted from the Policy would change the Sum Insured by
$2.30.

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<PAGE>
The Sum Insured under Option 2 will always be the greater of the Face Amount
plus Policy Value or the Policy Value multiplied by the applicable percentage.

CHANGE IN SUM INSURED OPTION

Generally, the Sum Insured Option in effect may be changed once each Policy year
by sending a Written Request for change to the Principal Office. Changing Sum
Insured Options will not require Evidence of Insurability. The effective date of
any such change will be the Monthly Payment Date on or following the date of
receipt of the request. No charges will be imposed on changes in Sum Insured
Options.

CHANGE FROM OPTION 1 TO OPTION 2

If the Sum Insured Option is changed from Option 1 to Option 2, the Face Amount
will be decreased to equal the Sum Insured less the Policy Value on the
effective date of the change. This change may not be made if it would result in
a Face Amount less than $100,000. A change from Option 1 to Option 2 will not
alter the amount of the Sum Insured at the time of the change, but will affect
the determination of the Sum Insured from that point on. Because the Policy
Value will be added to the new specified Face Amount, the Sum Insured will vary
with the Policy Value. Thus, under Option 2, the Insurance Amount at Risk will
always equal the Face Amount unless the Guideline Minimum Sum Insured is in
effect. The cost of insurance may also be higher or lower than it otherwise
would have been without the change in Sum Insured Option. See CHARGES AND
DEDUCTIONS -- "Monthly Deduction from Policy Value."

CHANGE FROM OPTION 2 TO OPTION 1

If the Sum Insured Option is changed from Option 2 to Option 1, the Face Amount
will be increased to equal the Sum Insured which would have been payable under
Option 2 on the effective date of the change (i.e. the Face Amount immediately
prior to the change plus the Policy Value on the date of the change). The amount
of the Sum Insured will not be altered at the time of the change. However, the
change in option will affect the determination of the Sum Insured from that
point on, since the Policy Value will no longer be added to the Face Amount in
determining the Sum Insured; the Sum Insured will equal the new Face Amount (or,
if higher, the Guideline Minimum Sum Insured). The cost of insurance may be
higher or lower than it otherwise would have been since any increases or
decreases in Policy Value will, respectively, reduce or increase the Insurance
Amount at Risk under Option 1. Assuming a positive net investment return with
respect to any amounts in the Separate Account, changing the Sum Insured Option
from Option 2 to Option 1 will reduce the Insurance Amount at Risk and therefore
the cost of insurance charge for all subsequent Monthly Deductions, compared to
what such charge would have been if no such change were made.

A change in Sum Insured Option may result in total premiums paid exceeding the
then current maximum premium limitation determined by IRS rules. In such event,
the Company will pay the excess to you. See THE POLICY -- "Premium Payments."

CHANGE IN FACE AMOUNT

Subject to certain limitations, you may increase or decrease the specified Face
Amount of a Policy at any time by submitting a Written Request to the Company.
Any increase or decrease in the specified Face Amount requested by you will
become effective on the Monthly Payment Date on or next following the date of
receipt of the request at the Principal Office or, if Evidence of Insurability
is required, the date of approval of the request.

INCREASES IN FACE AMOUNT

Along with the Written Request for an increase, you must submit satisfactory
Evidence of Insurability. The consent of the Insureds is also required whenever
the Face Amount is increased. A request for an increase in Face Amount may not
be less than $100,000. You may not increase the Face Amount after the younger
Insured reaches Age 80 or the older Insured reaches Age 85. An increase must be
accompanied by an additional

35
<PAGE>
premium if the Surrender Value is less than $50 plus an amount equal to the sum
of two Minimum Monthly Factors.

On the effective date of each increase in Face Amount, a transaction charge of
$40 will be deducted from Policy Value for administrative costs. The effective
date of the increase will be the first Monthly Payment Date on or following the
date all of the conditions for the increase are met.

An increase in the Face Amount will generally affect the Insurance Amount at
Risk and may affect the portion of the Insurance Amount at Risk included in
various Premium Classes (if more than one Premium Class applies), both of which
may affect the monthly cost of insurance charges. A surrender charge will also
be calculated for the increase. See CHARGES AND DEDUCTIONS -- "Monthly Deduction
from Policy Value" and "Surrender Charge."

After increasing the Face Amount, you will have the right (1) during a free-look
period, to have the increase canceled and the charges which would not have been
deducted but for the increase will be credited to the Policy and (2) during the
first 24 months following the increase, to transfer any or all Policy Value to
the General Account free of charge. See THE POLICY -- "Free-Look Period" and
"Conversion Privileges." A refund of charges which would not have been deducted
but for the increase will be made at your request.

DECREASES IN THE FACE AMOUNT

The minimum amount for a decrease in Face Amount is $100,000. The Face Amount in
force after any decrease may not be less than $100,000. If, following a decrease
in Face Amount, the Policy would not comply with the maximum premium limitation
applicable under the IRS rules, the decrease may be limited or Policy Value may
be returned to you (at your election) to the extent necessary to meet the
requirements. A return of Policy Value may result in tax liability to you.

A decrease in the Face Amount will affect the total Insurance Amount at Risk and
the portion of the Insurance Amount at Risk covered by various Premium Classes,
both of which may affect the Policyowner's monthly cost of insurance charges.
See CHARGES AND DEDUCTIONS -- "Monthly Deduction from Policy Value." For
purposes of determining the cost of insurance charge, any decrease in the Face
Amount will reduce the Face Amount in the following order:

- the Face Amount provided by the most recent increase;

- the next most recent increases successively; and

- the initial Face Amount.

This order will also be used to determine whether a surrender charge will be
deducted and in what amount. If you request a decrease in the Face Amount, the
amount of any surrender charge deducted will reduce the current Policy Value.
You may specify one Sub-Account from which the surrender charge will be
deducted. If no specification is provided, the Company will make a Pro-Rata
Allocation. The current surrender charge will be reduced by the amount deducted.
For more information, see CHARGES AND DEDUCTIONS -- "Surrender Charge" or
APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGE.

POLICY VALUE AND SURRENDER VALUE

The Policy Value is the total amount available for investment, and is equal to
the sum of:

- your accumulation in the General Account, PLUS

- the value of the Accumulation Units in the Sub-Accounts.

36
<PAGE>
The Policy Value is used in determining the Surrender Value (the Policy Value
less any Debt and applicable surrender charges). There is no guaranteed minimum
Policy Value. Because the Policy Value on any date depends upon a number of
variables, it cannot be predetermined.

The Policy Value and the Surrender Value will reflect frequency and amount of
Net Premiums paid, interest credited to accumulations in the General Account,
the investment performance of the chosen Sub-Accounts, any partial withdrawals,
any loans, any loan repayments, any loan interest paid or credited, and any
charges assessed in connection with the Policy.

CALCULATION OF POLICY VALUE

The Policy Value is determined first on the Date of Issue and thereafter on each
Valuation Date. On the Date of Issue, the Policy Value will be the Net Premiums
received, plus any interest earned during the underwriting period when premiums
are held in the General Account (before being transferred to the Separate
Account; see THE POLICY -- "Applying for the Policy") less any Monthly
Deductions due. On each Valuation Date after the Date of Issue the Policy Value
will be:

- the aggregate of the values in each of the Sub-Accounts on the Valuation
Date, determined for each Sub-Account by multiplying the value of an
Accumulation Unit in that Sub-Account on that date by the number of such
Accumulations Units allocated to the Policy; PLUS

- the value in the General Account (including any amounts transferred to the
General Account with respect to a loan).

Thus, the Policy Value is determined by multiplying the number of Accumulation
Units in each Sub-Account by the value of the applicable Accumulation Units on
the particular Valuation Date, adding the products, and adding the amount of the
accumulations in the General Account, if any.

THE ACCUMULATION UNIT

Each Net Premium is allocated to the Sub-Accounts selected by you. Allocations
to the Sub-Accounts are credited to the Policy in the form of Accumulation
Units. Accumulation Units are credited separately for each Sub-Account.

The number of Accumulation Units of each Sub-Account credited to the Policy is
equal to the portion of the Net Premium allocated to the Sub-Account, divided by
the dollar value of the applicable Accumulation Unit as of the Valuation Date
the payment is received at the Principal Office. The number of Accumulation
Units will remain fixed unless changed by a subsequent split of Accumulation
Unit value, transfer, partial withdrawal or Policy surrender. In addition, if
the Company is deducting the Monthly Deduction or other charges from a
Sub-Account, each such deduction will result in cancellation of a number of
Accumulation Units equal in value to the amount deducted.

The dollar value of an Accumulation Unit of each Sub-Account varies from
Valuation Date to Valuation Date based on the investment experience of that
Sub-Account. That experience, in turn, will reflect the investment performance,
expenses and charges of the respective Underlying Fund. The value of an
Accumulation Unit was set at $1.00 on the first Valuation Date for each
Sub-Account. The dollar value of an Accumulation Unit on a given Valuation Date
is determined by multiplying the dollar value of the corresponding Accumulation
Unit as of the immediately preceding Valuation Date by the appropriate net
investment factor.

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<PAGE>
NET INVESTMENT FACTOR

The net investment factor measures the investment performance of a Sub-Account
of the Separate Account during the Valuation Period just ended. The net
investment factor for each Sub-Account is equal to 1.0000 plus the number
arrived at by dividing (a) by (b) and subtracting (c) and (d) from the result,
where:

(a) is the investment income of that Sub-Account for the Valuation Period, plus
capital gains, realized or unrealized, credited during the Valuation Period;
minus capital losses, realized or unrealized, charged during the Valuation
Period; adjusted for provisions made for taxes, if any;

(b) is the value of that Sub-Account's assets at the beginning of the Valuation
Period;

(c) is a charge for each day in the Valuation Period equal on an annual basis to
0.90% of the daily net asset value of that Sub-Account for mortality and
expense risks. This charge may be increased or decreased by the Company, but
may not exceed 0.90%; and

(d) is the Separate Account administrative charge for each day in the Valuation
Period equal on an annual basis to 0.25% of the daily net asset value of
that Sub-Account. This charge is applicable only during the first 15 Policy
years.

The net investment factor may be greater or less than one. Therefore, the value
of an Accumulation Unit may increase or decrease. You bear the investment risk.

Allocations to the General Account are not converted into Accumulation Units,
but are credited interest at a rate periodically set by the Company. See MORE
INFORMATION ABOUT THE GENERAL ACCOUNT.

DEATH PROCEEDS PAYMENT OPTIONS

During the Insureds' lifetimes, you may arrange for the Death Proceeds to be
paid in a single sum or under one or more of the available payment options. The
payment options currently available are described in APPENDIX B -- PAYMENT
OPTIONS. These choices are also available at the Final Premium Payment Date and
if the Policy is surrendered. The Company may make more payment options
available in the future. If no election is made, the Company will pay the Death
Proceeds in a single sum. When the Death Proceeds are payable in a single sum,
the Beneficiary may, within one year of the death of the last surviving Insured,
select one or more of the payment options if no payments have yet been made.

OPTIONAL INSURANCE BENEFITS

Subject to certain requirements, one or more of the optional insurance benefits
described in APPENDIX A -- OPTIONAL BENEFITS may be added to the Policy by
rider. The cost of any optional insurance benefits will be deducted as part of
the Monthly Deduction. See CHARGES AND DEDUCTIONS -- "Monthly Deduction from
Policy Value."

POLICY SURRENDER

You may at any time surrender the Policy and receive its Surrender Value. The
Surrender Value is the Policy Value less any Debt and applicable surrender
charges. The Surrender Value will be calculated as of the Valuation Date on
which a Written Request for surrender and the Policy are received at the
Principal Office. A surrender charge will be deducted when the Policy is
surrendered if less than 15 full Policy years have elapsed from the Date of
Issue of the Policy or from the effective date of any increase in Face Amount.
See CHARGES AND DEDUCTIONS -- "Surrender Charge."

The proceeds on surrender may be paid in a single lump sum or under one of the
payment options described in APPENDIX B -- PAYMENT OPTIONS. The Company will
normally pay the Surrender Value within seven days following the Company's
receipt of the surrender request, but the Company may delay payment under the
circumstances described in OTHER POLICY PROVISIONS -- "Postponement of
Payments."

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<PAGE>
For important tax consequences which may result from surrender see FEDERAL TAX
CONSIDERATIONS.

PARTIAL WITHDRAWALS

Any time after the first Policy year, you may withdraw a portion of the
Surrender Value of the Policy, subject to the limits stated below, upon Written
Request filed at the Principal Office. The Written Request must indicate the
dollar amount you wish to receive and the Accounts from which such amount is to
be withdrawn. You may allocate the amount withdrawn among the Sub-Accounts and
the General Account. If you do not provide allocation instructions the Company
will make a Pro-Rata Allocation. Each partial withdrawal must be in a minimum
amount of $500. Under Option 1, the Face Amount is reduced by the amount of the
partial withdrawal, and a partial withdrawal will not be allowed if it would
reduce the Face Amount below $100,000.

A partial withdrawal from a Sub-Account will result in the cancellation of the
number of Accumulation Units equivalent in value to the amount withdrawn. The
amount withdrawn equals the amount requested by you plus the transaction charge
and any applicable partial withdrawal charge as described under CHARGES AND
DEDUCTIONS -- "Charges on Partial Withdrawals." The Company will normally pay
the amount of the partial withdrawal within seven days following the Company's
receipt of the partial withdrawal request, but the Company may delay payment
under certain circumstances described in OTHER POLICY PROVISIONS --
"Postponement of Payments."

For important tax consequences which may result from partial withdrawals, see
FEDERAL TAX CONSIDERATIONS.

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<PAGE>
CHARGES AND DEDUCTIONS

Charges will be deducted in connection with the Policy to compensate the Company
for providing the insurance benefits set forth in the Policy and any additional
benefits added by rider, administering the Policy, incurring distribution
expenses, and assuming certain risks in connection with the Policies.

Certain of the charges and deductions described below may be reduced for
Policies issued to employees of First Allmerica and its affiliates located at
First Allmerica's home office (or at off-site locations if such employees are on
First Allmerica's home office payroll); directors of the Company and its
affiliates and subsidiaries; employees and registered representatives of any
broker-dealer that has entered into a sales agreement with the Company or
Allmerica Investments, Inc. ("Allmerica Investments") to sell the Policies, and
any spouses or children of the above persons. The Cost of Insurance Charges may
be reduced, and no surrender charges, partial withdrawal charges or front-end
sales loads will be imposed (and no commissions will be paid), where the
Policyowner as of the date of application is within these categories.

TAX EXPENSE CHARGE

A charge will be deducted from each premium payment for the actual state and
local premium taxes paid by the Company and a charge of 1% of premiums to
compensate the Company for federal taxes imposed for deferred acquisition cost
("DAC") taxes. The premium tax deduction will change if there is a change in tax
rates or if the applicable jurisdiction changes (the Company should be notified
of any change in address as soon as possible). The Company reserves the right to
increase or decrease the 1% DAC tax deduction to reflect changes in the
Company's expenses for DAC taxes.

PREMIUM EXPENSE CHARGE

A charge of 1% of premiums will be deducted from each premium payment to
partially compensate the Company for the cost of selling the Policies. The
premium expense charge is a factor the Company must use when calculating the
maximum sales load it can charge under SEC rules during the first two Policy
years.

MONTHLY DEDUCTION FROM POLICY VALUE

Prior to the Final Premium Payment Date, a Monthly Deduction from Policy Value
will be made to cover a charge for the cost of insurance, a charge for any
optional insurance benefits added by rider and a monthly administrative charge.
The cost of insurance charge and the monthly administrative charges are
discussed below. The Monthly Deduction on or following the effective date of a
requested increase in the Face Amount will also include a $40 administrative
charge for the increase. See THE POLICY -- "Change in Face Amount."

Prior to the Final Premium Payment Date, the Monthly Deduction will be deducted
as of each Monthly Payment Date commencing with the Date of Issue of the Policy.
It will be allocated to one Sub-Account according to your instructions or, if no
allocation is specified, the Company will make a Pro-Rata Allocation. If the
Sub-Account you specify does not have sufficient funds to cover the Monthly
Deduction, the Company will deduct the charge for that month as if no
specification were made. However, if on subsequent Monthly Payment Dates there
is sufficient Policy Value in the Sub-Account you specified, the Monthly
Deduction will be deducted from that Sub-Account. No Monthly Deductions will be
made on or after the Final Premium Payment Date.

COST OF INSURANCE

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<PAGE>
each subsequent increase in Face Amount. Because the cost of insurance depends
upon a number of variables, it can vary from month to month.

CALCULATION OF THE CHARGE

If you select Sum Insured Option 2, the monthly cost of insurance charge for the
initial Face Amount will equal the applicable cost of insurance rate multiplied
by the initial Face Amount. If you select Sum Insured Option 1, however, the
applicable cost of insurance rate will be multiplied by the initial Face Amount
less the Policy Value (minus charges for rider benefits) at the beginning of the
Policy month. Thus, the cost of insurance charge may be greater for Policyowners
who have selected Sum Insured Option 2 than for those who have selected Sum
Insured Option 1, assuming the same Face Amount in each case and assuming that
the Guideline Minimum Sum Insured is not in effect. In other words, since the
Sum Insured under Option 1 remains constant while the Sum Insured under
Option 2 varies with the Policy Value, any Policy Value increases will reduce
the insurance charge under Option 1 but not under Option 2.

If you select Sum Insured Option 2, the monthly insurance charge for each
increase in Face Amount (other than an increase caused by a change in the Sum
Insured Option) will be equal to the cost of insurance rate applicable to that
increase multiplied by the increase in Face Amount. If you select Sum Insured
Option 1, the applicable cost of insurance rate will be multiplied by the
increase in the Face Amount reduced by any Policy Value (minus rider charges) in
excess of the initial Face Amount at the beginning of the policy month.

EFFECT OF THE GUIDELINE MINIMUM SUM INSURED

If the Guideline Minimum Sum Insured is in effect under either Option, a monthly
cost of insurance charge also will be calculated for that additional portion of
the Sum Insured which is required to comply with the Guideline rules. This
charge will be calculated by:

- multiplying the cost of insurance rate applicable to the initial Face
Amount times the Guideline Minimum Sum Insured (Policy Value times the
applicable percentage), MINUS

- the greater of the Face Amount or the Policy Value (if you selected Sum
Insured Option 1)

- the Face Amount PLUS the Policy Value (if you selected Sum Insured
Option 2).

When the Guideline Minimum Sum Insured is in effect, the cost of insurance
charge for the initial Face Amount and for any increases will be calculated as
set forth above. The monthly cost of insurance charge also will be adjusted for
any decreases in the Face Amount. See THE POLICY -- "Change in Face Amount."

COST OF INSURANCE RATES

Cost of insurance rates are based on a blended unisex rate table, Age and
Premium Class of the Insureds at the Date of Issue, the effective date of an
increase or date of rider, as applicable, the amount of premiums paid less Debt,
any partial withdrawals and withdrawal charges, and risk classification.
Sex-distinct rates do not apply, except in those states that do not permit
unisex rates.

The cost of insurance rates are determined at the beginning of each Policy year
for the initial Face Amount. The cost of insurance rates for an increase in Face
Amount or rider are determined annually on the anniversary of the effective date
of each increase or rider. The cost of insurance rates generally increase as the
Insureds' Ages increase. The actual monthly cost of insurance rates will be
based on the Company's expectations as to future mortality experience. They will
not, however, be greater than the guaranteed cost of insurance rates set forth
in the Policy. These guaranteed rates are based on the 1980 Commissioners
Standard Ordinary Mortality Table D, Smoker or Non-Smoker, and the Insureds'
Ages. The Tables used for this purpose set forth different mortality estimates
for smokers and non-smokers. Any change in the cost of insurance rates will
apply to all persons of the same insuring Age and Premium Class whose Policies
have been in force for the same length of time.

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The Premium Class of an Insured will affect the cost of insurance rates. The
Company currently places Insureds into standard Premium Classes and substandard
Premium Classes. In an otherwise identical Policy, an Insured in the Standard
Premium Class will have a lower cost of insurance than an Insured in a
substandard Premium Class with a higher mortality risk. The Premium Classes are
also divided into two categories: smokers and nonsmokers. Nonsmoking Insureds
will incur lower cost of insurance rates than Insureds who are classified as
smokers but who are otherwise in the same Premium Class. Any Insured with an Age
at issuance under 18 will be classified initially as regular or substandard. The
Insured then will be classified as a smoker at Age 18 unless the Insured
provides satisfactory evidence that the Insured is a nonsmoker. The Company will
provide notice to you of the opportunity for an Insured to be classified as a
nonsmoker when the Insured reaches Age 18.

The cost of insurance rate is determined separately for the initial Face Amount
and for the amount of any increase in Face Amount. For each increase in Face
Amount you request, at a time when an Insured is in a less favorable Premium
Class than previously, a correspondingly higher cost of insurance rate will
apply only to that portion of the Insurance Amount at Risk for the increase. For
the initial Face Amount and any prior increases, the Company will use the
Premium Class previously applicable. On the other hand, if an Insured's Premium
Class improves on an increase, the lower cost of insurance rate generally will
apply to the entire Insurance Amount at Risk.

MONTHLY ADMINISTRATIVE CHARGES

Prior to the Final Premium Payment Date, a monthly administrative charge of $6
per month will be deducted from Policy Value. This charge will be used to
compensate the Company for expenses incurred in the administration of the Policy
and will compensate the Company for first-year underwriting and other start-up
expenses incurred in connection with the Policy. These expenses include the cost
of processing applications, conducting medical examinations, determining
insurability and the Insureds' Premium Class, and establishing Policy records.
The Company does not expect to derive a profit from these charges.

CHARGES AGAINST ASSETS OF THE SEPARATE ACCOUNT

The Company assesses each Sub-Account with a charge for mortality and expense
risks assumed by the Company and a charge for administrative expenses of the
Separate Account.

MORTALITY AND EXPENSE RISK CHARGE

The Company currently makes a charge on an annual basis of 0.90% of the daily
net asset value in each Sub-Account. This charge is for the mortality risk and
expense risk which the Company assumes in relation to the variable portion of
the Policies. The total charges may be increased or decreased by the Board of
Directors of the Company once each year, subject to compliance with applicable
state and federal requirements, but it may not exceed 0.90% on an annual basis.

The mortality risk assumed by the Company is that Insureds may live for a
shorter time than anticipated, and that the Company will therefore pay an
aggregate amount of Death Proceeds greater than anticipated. The expense risk
assumed is that the expenses incurred in issuing and administering the Policies
will exceed the amounts realized from the administrative charges provided in the
Policies. If the charge for mortality and expense risks is not sufficient to
cover actual mortality experience and expenses, the Company will absorb the
losses. If costs are less than the amounts provided, the difference will be a
profit to the Company. To the extent this charge results in a current profit to
the Company, such profit will be available for use by the Company for, among
other things, the payment of distribution, sales and other expenses. Since
mortality and expense risks involve future contingencies which are not subject
to precise determination in advance, it is not feasible to identify specifically
the portion of the charge which is applicable to each.

SEPARATE ACCOUNT ADMINISTRATIVE CHARGE

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Separate Account and the Sub-Accounts include, but are not limited to, clerical,
accounting, actuarial and legal services, rent, postage, telephone, office
equipment and supplies, expenses of preparing and printing registration
statements, expenses of preparing and typesetting prospectuses and the cost of
printing prospectuses not allocable to sales expense, filing and other fees. No
Separate Account administrative charge is imposed after the 15 Policy year.

OTHER CHARGES AND EXPENSES

Because the Sub-Accounts purchase shares of the Underlying Funds, the value of
the Accumulation Units of the Sub-Accounts will reflect the investment advisory
fee and other expenses incurred by the Underlying Funds. The prospectuses and
statements of additional information of the Trust, Fidelity VIP, Fidelity VIP
II, T. Rowe Price, and DGPF contain additional information concerning such fees
and expenses.

No charges are currently made against the Sub-Accounts for federal or state
income taxes. Should the Company determine that taxes will be imposed, the
Company may make deductions from the Sub-Account to pay such taxes. See FEDERAL
TAX CONSIDERATIONS. The imposition of such taxes would result in a reduction of
the Policy Value in the Sub-Accounts.

SURRENDER CHARGE

The Policy provides for a contingent surrender charge. A surrender charge may be
deducted if you request a full surrender of the Policy or a decrease in Face
Amount. The duration of the surrender charge is 15 years from Date of Issue or
from the effective date of any increase in the Face Amount. A separate surrender
charge, described in more detail below, is calculated upon the issuance of the
Policy and for each increase in the Face Amount.

The surrender charge is comprised of a contingent deferred administrative charge
and a contingent deferred sales charge. The contingent deferred administrative
charge compensates the Company for expenses incurred in administering the
Policy. The contingent deferred sales charge compensates the Company for
expenses relating to the distribution of the Policy, including agent's
commissions, advertising and the printing of the prospectus and sales
literature.

The maximum surrender charge calculated upon issuance of the Policy is equal to
the sum of (a) plus (b) where:

(a) is a deferred administrative charge equal to $8.50 per thousand dollars of
the initial Face Amount, and

(b) is a deferred sales charge of 48% of premiums received up to a maximum
number of Guideline Annual Premiums subject to the deferred sales charge
that varies by average issue Age from 1.95 (for average issue Ages 5 through
75) to 1.31 (for average issue Age 82).

In accordance with limitations under state insurance regulations, the amount of
the maximum surrender charge will not exceed a specified amount per $1,000
initial Face Amount, as indicated in APPENDIX D -- CALCULATION OF MAXIMUM
SURRENDER CHARGES. The maximum surrender charge initially remains level for 40
months, declines by one-half of one percent of the initial amount for 80 months,
and then declines by one percent each month thereafter, reaching zero at the end
of the 180 Policy Months (15 Policy years), as described in APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES. This reduction in the maximum
surrender charge will reduce the deferred sales charge and the deferred
administrative charge proportionately.

If you surrender the Policy during the first two Policy years following the Date
of Issue, before making premium payments associated with the initial Face Amount
which are at least equal to one Guideline Annual Premium, the deferred
administrative charge will be $8.50 per thousand dollars of initial Face Amount,
as described above, but the deferred sales charge will not exceed 25% of
premiums received. See APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES.

SEPARATE SURRENDER CHARGE FOR EACH FACE AMOUNT INCREASE

A separate surrender charge will apply to and is calculated for each increase in
Face Amount. The surrender charge for the increase is in addition to that for
the initial Face Amount. The maximum surrender charge for

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the increase is equal to the sum of (a) plus (b), where (a) is equal to $8.50
per thousand dollars of increase, and (b) is a deferred sales charge of 48% of
premiums associated with the increase, up to a maximum number of Guideline
Annual Premiums (for the increase) subject to the deferred sales charge that
varies by average Age (at the time of increase) from 1.95 (for average Ages 5
through 75) to 1.31 (for average Age 82). In accordance with limitations under
state insurance regulations, the amount of the surrender charge will not exceed
a specified amount per $1,000 of increase, as indicated in APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES. As is true for the initial Face
Amount, (a) is a deferred administrative charge and (b) is a deferred sales
charge. The maximum surrender charge initially remains level for 40 months,
declines by one-half of one percent of the initial amount for 80 months, and
then declines by one percent each month thereafter, reaching zero at the end of
the 180 Policy Months (15 Policy years), as provided in APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES.

If you surrender the Policy during the first two Policy years following an
increase in Face Amount before making premium payments associated with the
increase in Face Amount which are at least equal to one Guideline Annual
Premium, the deferred administrative charge will be $8.50 per thousand dollars
of Face Amount increase, as described above, but the deferred sales charge will
not exceed 25% of premiums associated with the increase. See APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES. The premiums associated with the
increase are determined as described below.

ALLOCATION OF POLICY VALUE AND PREMIUMS UPON AN INCREASE IN FACE AMOUNT

Additional premium payments may not be required to fund a requested increase in
Face Amount. Therefore, a special rule, which is based on relative Guideline
Annual Premium payments, applies to allocate a portion of existing Policy Value
to the increase and to allocate subsequent premium payments between the initial
Face Amount and the increase.

For example, suppose the Guideline Annual Premium is equal to $1,500 before an
increase and is equal to $2,000 as a result of the increase. The Policy Value on
the effective date of the increase would be allocated 75% ($1,500/$2,000) to the
initial Face Amount and 25% to the increase. All future premiums would also be
allocated 75% to the initial Face Amount and 25% to the increase. Thus, existing
Policy Value associated with the increase will equal the portion of Policy Value
allocated to the increase on the effective date of the increase, before any
deductions are made. Premiums associated with the increase will equal the
portion of the premium payments actually made on or after the effective date of
the increase which are allocated to the increase.

See APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES for examples
illustrating the calculation of the maximum surrender charge for the initial
Face Amount and for any increases, as well as for the surrender charge based on
actual premiums paid or associated with any increases.

POSSIBLE SURRENDER CHARGE ON A DECREASE IN THE FACE AMOUNT

A surrender charge may be deducted on a decrease in the Face Amount. In the
event of a decrease, the surrender charge deducted is a fraction of the charge
that would apply to a full surrender of the Policy. The fraction will be
determined by dividing the amount of the decrease by the current Face Amount and
multiplying the result by the surrender charge. If more than one surrender
charge is in effect (i.e., pursuant to one or more increases in the Face Amount
of the Policy), the surrender charge will be applied in the following order:
(1) the most recent increase; (2) the next most recent increases successively,
and (3) the initial Face Amount. Where a decrease causes a partial reduction in
an increase or in the initial Face Amount, a proportionate share of the
surrender charge for that increase or for the initial Face Amount will be
deducted. For more information, see APPENDIX D -- CALCULATION OF MAXIMUM
SURRENDER CHARGES.

CHARGES ON PARTIAL WITHDRAWALS

After the first Policy year, partial withdrawals of Surrender Value may be made.
The minimum withdrawal is $500. Under Option 1, the Face Amount is reduced by
the amount of the partial withdrawal, and a partial withdrawal will not be
allowed if it would reduce the Face Amount below $100,000.

A transaction charge, which is the smaller of 2% of the amount withdrawn or $25,
will be assessed on each partial withdrawal to reimburse the Company for the
cost of processing the withdrawal. The Company does

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not expect to make a profit on this charge. The transaction fee applies to all
partial withdrawals including a Withdrawal without a surrender charge.

A partial withdrawal charge may also be deducted from Policy Value. For each
partial withdrawal you may withdraw an amount equal to 10% of the Policy Value
on the date the written withdrawal request is received by the Company less the
total of any prior withdrawals in that Policy year which were not subject to the
partial withdrawal charge, without incurring a partial withdrawal charge. Any
partial withdrawal in excess of this amount ("excess withdrawal") will be
subject to the partial withdrawal charge. The partial withdrawal charge is equal
to 5% of the excess withdrawal up to the amount of the surrender charges on the
date of withdrawal.

This right is not cumulative from Policy year to Policy year. For example, if
only 8% of Policy Value were withdrawn in Policy year two, the amount you could
withdraw in subsequent Policy years would not be increased by the amount you did
not withdraw in the second Policy year.

The Policy's outstanding surrender charge will be reduced by the amount of the
partial withdrawal charge deducted by proportionately reducing the deferred
sales charge component and the deferred administrative charge component. The
partial withdrawal charge deducted will decrease existing surrender charges in
the following order:

- first, the surrender charge for the most recent increase in the Face
Amount;

- second, the surrender charge for the next most recent increases
successively;

- last, the surrender charge for the initial Face Amount.

TRANSFER CHARGES

The first 12 transfers in a Policy year will be free of charge. Thereafter, a
transfer charge of $10 will be imposed for each transfer request to reimburse
the Company for the administrative costs incurred in processing the transfer
request. The Company reserves the right to increase the charge, but it never
will exceed $25. The Company also reserves the right to change the number of
free transfers allowed in a Policy year. See THE POLICY -- "Transfer Privilege."

You may have automatic transfers of at least $100 a month made on a periodic
basis:

- from the Sub-Accounts which invest in the Money Market Fund and Government
Bond Fund of the Trust to one or more of the other Sub-Accounts; or

- to reallocate Policy Value among the Sub-Accounts.

The first automatic transfer counts as one transfer towards the 12 free
transfers allowed in each Policy year. Each subsequent automatic transfer is
without charge and does not reduce the remaining number of transfers which may
be made without charge.

If you utilize the Conversion Privilege, Loan Privilege or reallocate Policy
Value within 20 days of the Date of Issue of the Policy, any resulting transfer
of Policy Value from the Sub-Accounts to the General Account will be free of
charge, and in addition to the 12 free transfers in a Policy year. See THE
POLICY -- "Conversion Privileges," and POLICY LOANS.

CHARGE FOR INCREASE IN FACE AMOUNT

For each increase in the Face Amount you request, a transaction charge of $40
will be deducted from Policy Value to reimburse the Company for administrative
costs associated with the increase. This charge is guaranteed not to increase
and the Company does not expect to make a profit on this charge.

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OTHER ADMINISTRATIVE CHARGES

The Company reserves the right to impose a charge for the administrative costs
incurred for changing the Net Premium allocation instructions, for changing the
allocation of any Monthly Deductions among the various Sub-Accounts, or for a
projection of values. No such charges are currently imposed and any such charge
is guaranteed not to exceed $25.

POLICY LOANS

You may borrow against the Policy Value. Policy loans may be obtained by request
to the Company on the sole security of the Policy. The total amount which may be
borrowed is the Loan Value. In the first Policy year, the Loan Value is 75% of
Policy Value reduced by applicable surrender charges, as well as Monthly
Deductions and interest on Debt to the end of the Policy year. The Loan Value in
the second Policy year and thereafter is 90% of an amount equal to the Policy
Value reduced by applicable surrender charges. There is no minimum limit on the
amount of the loan.

The loan amount normally will be paid within seven days after the Company
receives the loan request at the Principal Office, but the Company may delay
payments under certain circumstances. See OTHER POLICY PROVISIONS --
"Postponement of Payments."

A Policy loan may be allocated among the General Account and one or more
Sub-Accounts. If you do not make an allocation, the Company will make a Pro-Rata
Allocation based on the amounts in the Accounts on the date the Company receives
the loan request. The Policy Value in each Sub-Account equal to the Policy loan
allocated to such Sub-Account will be transferred to the General Account, and
the number of Accumulation Units equal to the Policy Value so transferred will
be canceled. This will reduce the Policy Value in these Sub-Accounts. These
transactions are not treated as transfers for purposes of the transfer charge.

LOAN AMOUNT EARNS INTEREST IN GENERAL ACCOUNT

As long as the Policy is in force, the Policy Value in the General Account equal
to the loan amount will be credited with interest at an effective annual yield
of at least 6.00% per year.

PREFERRED LOAN OPTION

A preferred loan option is available under the Policy. The preferred loan option
will be available upon Written Request. You may change a preferred loan to a
non-preferred loan at any time upon written request. It may be revoked by you at
any time. If this option has been selected, after the tenth Policy anniversary
the Policy Value in the General Account that is equal to the loan amount will be
credited with interest at an effective annual yield of at least 7.5%. The
Company's current practice is to credit a rate of interest equal to the rate
being charged for the preferred loan.

There is some uncertainty as to the tax treatment of a preferred loan, which may
be treated as a taxable distribution from the Policy. Consult a qualified tax
adviser (and see FEDERAL TAX CONSIDERATIONS). THE PREFERRED LOAN OPTION IS NOT
AVAILABLE IN ALL STATES.

LOAN INTEREST CHARGED

Outstanding Policy loans are charged interest. Interest accrues daily and is
payable in arrears at the annual rate of 8%. Interest is due and payable at the
end of each Policy year or on a pro-rata basis for such shorter period as the
loan may exist. Interest not paid when due will be added to the loan amount and
will bear interest at the same rate. If the new loan amount exceeds the Policy
Value in the General Account after the due and unpaid interest is added to the
loan amount, the Company will transfer Policy Value equal to that excess loan
amount from the Policy Value in each Sub-Account to the General Account as
security for the excess loan amount. The Company will allocate the amount
transferred among the Sub-Accounts in the same proportion that the Policy Value
in each Sub-Account bears to the total Policy Value in all Sub-Accounts.

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REPAYMENT OF LOANS

Loans may be repaid at any time prior to the lapse of the Policy. Upon repayment
of the Debt, the portion of the Policy Value that is in the General Account
securing the loan repaid will be allocated to the various Accounts and increase
the Policy Value in such Accounts in accordance with your instructions. If you
do not make a repayment allocation, the Company will allocate Policy Value in
accordance with your most recent premium allocation instructions; provided,
however, that loan repayments allocated to the Separate Account cannot exceed
the Policy Value previously transferred from the Separate Account to secure the
Debt.

If Debt exceeds the Policy Value less the surrender charge, the Policy will
terminate. A notice of such pending termination will be mailed to the last known
address of you and any assignee. If you do not make sufficient payment within 62
days after this notice is mailed, the Policy will terminate with no value. See
POLICY TERMINATION AND REINSTATEMENT.

EFFECT OF POLICY LOANS

Although Policy loans may be repaid at any time prior to the lapse of the
Policy, Policy loans will permanently affect the Policy Value and Surrender
Value, and may permanently affect the Death Proceeds. The effect could be
favorable or unfavorable, depending upon whether the investment performance of
the Sub-Accounts is less than or greater than the interest credited to the
Policy Value in the General Account attributable to the loan. Moreover,
outstanding Policy loans and the accrued interest will be deducted from the
proceeds payable upon the death of the last surviving Insured or surrender.

POLICY TERMINATION AND REINSTATEMENT

TERMINATION

The failure to make premium payments will not cause the Policy to lapse unless:

(a) the Surrender Value is insufficient to cover the next Monthly Deduction plus
loan interest accrued;

(b) the Debt exceeds the Policy Value less surrender charges.

If one of these situations occurs, the Policy will be in default. You then will
have a grace period of 62 days, measured from the date of default, to make
sufficient payments to prevent termination. On the date of default, the Company
will send a notice to you and to any assignee of record. The notice will state
the amount of premium due and the date on which it is due.

Failure to make a sufficient payment within the grace period will result in
termination of the Policy. If the last surviving Insured dies during the grace
period, the Death Proceeds still will be payable, but any Monthly Deductions due
and unpaid through the Policy month in which the last surviving Insured dies,
and any other overdue charge, will be deducted from the Death Proceeds.

LIMITED 48-MONTH GUARANTEE

Except for the situation described in (b) above, the Policy is guaranteed not to
lapse during the first 48 months after the Date of Issue or the effective date
of an increase in the Face Amount if you make a minimum amount of premium
payments. The minimum amount paid, minus the Debt, partial withdrawals and
partial withdrawal charges, must be at least equal to the sum of the Minimum
Monthly Factor for the number of months the Policy, increase in Face Amount, or
a Policy Change which causes a change in the Minimum Monthly Factor has been in
force. A Policy change which causes a change in the Minimum Monthly Factor is a
change in the Face Amount or the addition or deletion of a rider.

Except for the first 48 months after the Date of Issue or the effective date of
an increase, payments equal to the Minimum Monthly Factor do not guarantee that
the Policy will remain in force.

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REINSTATEMENT

If the Policy has not been surrendered and either or both the Insureds is alive,
the terminated Policy may be reinstated any time within three years after the
date of default and before the Final Premium Payment Date. The reinstatement
will be effective on the Monthly Payment Date following the date you submit the
following to the Company:

- a written application for reinstatement,

- Evidence of Insurability showing that the Insureds is insurable according
to the Company's underwriting rules, and

- a premium that, after the deduction of the tax expense charge and premium
expense charge, is large enough to cover the minimum amount payable, as
described below.

MINIMUM AMOUNT PAYABLE

If reinstatement is requested when fewer than 48 Monthly Deductions have been
made since the Date of Issue or the effective date of an increase in the Face
Amount, you must pay the lesser of the amount shown in (1) or (2). Under (1),
the minimum amount payable is the Minimum Monthly Factor for the three-month
period beginning on the date of reinstatement. Under (2), the minimum amount
payable is the sum of

- the amount by which the surrender charge as of the date of reinstatement
exceeds the Policy Value on the date of default, plus

- Monthly Deductions for the three-month period beginning on the date of
reinstatement.

If reinstatement is requested after 48 Monthly Deductions have been made since
the Date of Issue of the Policy or any increase in the Face Amount, you must pay
the amount shown in (b) above. The Company reserves the right to increase the
Minimum Monthly Factor upon reinstatement.

SURRENDER CHARGE

The surrender charge on the date of reinstatement is the surrender charge which
would have been in effect had the Policy remained in force from the Date of
Issue. The Policy Value less Debt on the date of default will be restored to the
Policy to the extent it does not exceed the surrender charge on the date of
reinstatement. Any Policy Value less the Debt as of the date of default which
exceeds the surrender charge on the date of reinstatement will not be restored.

POLICY VALUE ON REINSTATEMENT

The Policy Value on the date of reinstatement is:

- the Net Premium paid to reinstate the Policy increased by interest from
the date the payment was received at the Principal Office, PLUS

- an amount equal to the Policy Value less Debt on the date of default to
the extent it does not exceed the surrender charge on the date of
reinstatement, MINUS

- the Monthly Deduction due on the date of reinstatement.

You may not reinstate any Debt outstanding on the date of default or
foreclosure.

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OTHER POLICY PROVISIONS

The following Policy provisions may vary in certain states in order to comply
with requirements of the insurance laws, regulations, and insurance regulatory
agencies in those states.

POLICYOWNER

The Policyowner is named in the applications for the Policy. The Policyowner is
generally entitled to exercise all rights under the Policy while the Insureds
are alive, subject to the consent of any irrevocable Beneficiary (the consent of
a revocable Beneficiary is not required). The consent of the Insureds is
required whenever the Face Amount of insurance is increased.

BENEFICIARY

The Beneficiary is the person or persons to whom the insurance proceeds are
payable upon the death of the last surviving Insured. Unless otherwise stated in
the Policy, the Beneficiary has no rights in the Policy before the death of the
last surviving Insured. While the Insureds are alive, you may change any
Beneficiary unless you have declared a Beneficiary to be irrevocable. If no
Beneficiary is alive when the last surviving Insured dies, the Policyowner (or
the Policyowner's estate) will be the Beneficiary. If more than one Beneficiary
is alive when the last surviving Insured dies, they will be paid in equal
shares, unless you have chosen otherwise. Where there is more than one
Beneficiary, the interest of a Beneficiary who dies before the last surviving
Insured dies will pass to surviving Beneficiaries proportionally.

INCONTESTABILITY

The Company will not contest the validity of the Policy after it has been in
force during the lifetimes of both Insureds for two years from the Date of
Issue. The Company will not contest the validity of any increase in the Face
Amount after such increase or rider has been in force during the lifetimes of
both Insureds for two years from its effective date.

SUICIDE

The Death Proceeds will not be paid if either Insured commits suicide, while
sane or insane, within two years from the Date of Issue. Instead, the Company
will pay the Beneficiary an amount equal to all premiums paid for the Policy,
without interest, less any outstanding Debt and less any partial withdrawals. If
either Insured commits suicide, while sane or insane, generally within two years
from the effective date of any increase in the Sum Insured, the Company's
liability with respect to such increase will be limited to a refund of the cost
thereof. The Beneficiary will receive the administrative charges and insurance
charges paid for such increase.

NOTICE OF FIRST INSURED TO DIE

Within 90 days of the death of the first Insured to die, or as soon thereafter
as is reasonably possible, you must mail to the Principal Office due proof of
such death.

AGE

If the Age of either Insured as stated in the application for the Policy is not
correct, benefits under the Policy will be adjusted to reflect the correct Age,
if death of the last surviving Insured occurs prior to the Final Premium Payment
Date. The adjusted benefit will be that which the most recent cost of insurance
charge would have purchased for the correct Age. In no event will the Sum
Insured be reduced to less than the Guideline Minimum Sum Insured.

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ASSIGNMENT

The Policyowner may assign the Policy as collateral or make an absolute
assignment of the Policy. All rights under the Policy will be transferred to the
extent of the assignee's interest. The consent of the assignee may be required
in order to make changes in premium allocations, to make transfers, or to
exercise other rights under the Policy. The Company is not bound by an
assignment or release thereof, unless it is in writing and is recorded at the
Principal Office. When recorded, the assignment will take effect as of the date
the Written Request was signed. Any rights created by the assignment will be
subject to any payments made or actions taken by the Company before the
assignment is recorded. The Company is not responsible for determining the
validity of any assignment or release.

POSTPONEMENT OF PAYMENTS

Payments of any amount due from the Separate Account upon surrender, partial
withdrawals, or death of the last surviving Insured, as well as payments of a
Policy loan and transfers may be postponed whenever: (a) the New York Stock
Exchange is closed for other than customary weekend and holiday closings, or
trading on the New York Stock Exchange is restricted as determined by the SEC or
(b) an emergency exists, as determined by the SEC, as a result of which disposal
of securities is not reasonably practicable or it is not reasonably practicable
to determine the value of the Separate Account's net assets. Payments under the
Policy of any amounts derived from the premiums paid by check may be delayed
until such time as the check has cleared your bank.

The Company also reserves the right to defer payment of any amount due from the
General Account upon surrender, partial withdrawal or death of the last
surviving Insured, as well as payments of Policy loans and transfers from the
General Account, for a period not to exceed six months.

VOTING RIGHTS

To the extent required by law, the Company will vote Underlying Fund shares held
by each Sub-Account in accordance with instructions received from Policyowners
with Policy Value in such Sub-Account. If the 1940 Act or any rules thereunder
should be amended or if the present interpretation of the 1940 Act or such rules
should change, and as a result the Company determines that it is permitted to
vote shares in its own right, whether or not such shares are attributable to the
Policies, the Company reserves the right to do so.

The number of votes which the Policyowner has the right to instruct will be
determined by the Company as of the record date established for the Underlying
Fund. This number is determined by dividing each Policyowner's Policy Value in
the Sub-Account, if any, by the net asset value of one share in the
corresponding Underlying Fund in which the assets of the Sub-Account are
invested.

We may, when required by state insurance regulatory authorities, disregard
voting instructions if the instructions require that the Fund shares be voted so
as (1) to cause a change in the subclassification or investment objective of one
or more of the Underlying Funds or (2) to approve or disapprove an investment
advisory contract for the Funds. In addition, we may disregard voting
instructions that are in favor of any change in the investment policies or in
any investment adviser or principal underwriter if the change has been initiated
by Policyowners or the Trustees. Our disapproval of any such change must be
reasonable and, in the case of a change in investment policies or investment
adviser, based on a good faith determination that such change would be contrary
to state law or otherwise is inappropriate in light of the objectives and
purposes of the Funds. In the event we do disregard voting instructions, a
summary of that action and the reasons for that action will be included in the
next periodic report to Policyowners.

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<PAGE>
DIRECTORS AND PRINCIPAL OFFICERS OF THE COMPANY

<TABLE>
<CAPTION>
NAME AND POSITION WITH COMPANY PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
- ------------------------------ ----------------------------------------------
<S> <C>
Bruce C. Anderson Director (since 1996), Vice President (since 1984)
Director and Assistant Secretary (since 1992) of First
Allmerica

Warren E. Barnes Vice President (since 1996) and Corporate Controller
Vice President and Corporate (since 1998) of First Allmerica
Controller

Mark R. Colborn Director (since 2000) and Vice President (since 1992)
Director and Vice President of First Allmerica.

Mary Eldridge Secretary (since 1999) of First Allmerica; Secretary
Secretary (since 1999) of Allmerica Investments, Inc.; and
Secretary (since 1999) of Allmerica Financial
Investment Management Services, Inc.

J. Kendall Huber Director, Vice President and General Counsel of First
Director, Vice President and Allmerica (since 2000); Vice President (1999) of
General Counsel Promos Hotel Corporation; Vice President & Deputy
General Counsel (1998-1999) of Legg Mason, Inc.; Vice
President and Deputy General Counsel (1995-1998) of
USF&G Corporation.

John P. Kavanaugh Director and Chief Investment Officer (since 1996)
Director, Vice President and Chief and Vice President (since 1991) of First Allmerica;
Investment Officer Vice President (since 1998) of Allmerica Financial
Investment Management Services, Inc.; and President
(since 1995) and Director (since 1996) of Allmerica
Asset Management, Inc.

J. Barry May Director (since 1996) of First Allmerica; Director
Director and President (since 1996) of The Hanover Insurance
Company; and Vice President (1993 to 1996) of The
Hanover Insurance Company

James R. McAuliffe Director (since 1996) of First Allmerica; Director
Director (since 1992), President (since 1994) and Chief
Executive Officer (since 1996) of Citizens Insurance
Company of America

Mark C. McGivney Vice President (since 1997) and Treasurer (since
Vice President and Treasurer 2000) of First Allmerica; Associate, Investment
Banking (1996 --1997) of Merrill Lynch & Co.;
Associate, Investment Banking (1995) of Salomon
Brothers, Inc.; Treasurer (since 2000) of Allmerica
Investments, Inc., Allmerica Asset Management, Inc.
and Allmerica Financial Investment Management
Services, Inc.

John F. O'Brien Director, President and Chief Executive Officer
Director and Chairman of the Board (since 1989) of First Allmerica

Edward J. Parry, III Director and Chief Financial Officer (since 1996),
Director, Vice President, Chief Vice President (since 1993), and Treasurer (1993 -
Financial Officer 2000) of First Allmerica

Richard M. Reilly Director (since 1996) and Vice President (since 1990)
Director, President and Chief of First Allmerica; President (since 1995) of
Executive Officer Allmerica Financial Life Insurance and Annuity
Company; Director (since 1990) of Allmerica
Investments, Inc.; and Director and President (since
1998) of Allmerica Financial Investment Management
Services, Inc.
</TABLE>

51
<PAGE>

<TABLE>
<CAPTION>
NAME AND POSITION WITH COMPANY PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
- ------------------------------ ----------------------------------------------
<S> <C>
Robert P. Restrepo, Jr. Director and Vice President (since 1998) of First
Director Allmerica; Director (since 1998) of The Hanover
Insurance Company; Chief Executive Officer (1996 to
1998) of Travelers Property & Casualty; Senior Vice
President (1993 to 1996) of Aetna Life & Casualty
Company

Eric A. Simonsen Director (since 1996) and Vice President (since 1990)
Director and Vice President of First Allmerica; Director (since 1991) of
Allmerica Investments, Inc.; and Director (since
1991) of Allmerica Financial Investment Management
Services, Inc.
</TABLE>

DISTRIBUTION

Allmerica Investments, Inc. ("Allmerica Investments"), an indirect subsidiary of
First Allmerica, acts as the principal underwriter of the Policies pursuant to a
Sales and Administrative Services Agreement with the Company and the Separate
Account. Allmerica Investments is registered with the SEC as a broker-dealer,
and is a member of the National Association of Securities Dealers, Inc. The
Policies are sold by agents of the Company who are registered representatives of
Allmerica Investments, or of broker-dealers which have entered into selling
agreements with Allmerica Investments.

The Company pays to registered representatives who sell the Policy Commissions
based on a commission schedule. After issue of the Policy or an increase in Face
Amount, commissions generally will equal 50 percent of the first year premiums
up to a basic premium amount established by the Company. Thereafter, commissions
will generally equal 3.5% of any additional premiums. Certain registered
representatives, including registered representatives enrolled in the Company's
training program for new agents, may receive additional first year and renewal
commissions and training reimbursements. General Agents of the Company and
certain registered representatives may also be eligible to receive expense
reimbursements based on the amount of earned commissions. General Agents may
also receive overriding commissions, which will not exceed 10% of first-year or
14% of renewal premiums.

The Company intends to recoup the commission and other sales expense through a
combination of the deferred sales charge component of the anticipated surrender
and partial withdrawal charges, and the investment earnings on amounts allocated
to accumulate on a fixed basis in excess of the interest credited on fixed
accumulations by the Company. There is no additional charge to you or to the
Separate Account. Any surrender charge assessed on the Policy will be retained
by the Company except for amounts it may pay to Allmerica Investments for
services it performs and expenses it may incur as principal underwriter and
general distributor services.

REPORTS

The Company will maintain the records relating to the Separate Account. You will
be promptly sent statements of significant transactions such as premium
payments, changes in specified Face Amount, changes in Sum Insured Option,
transfers among Sub-Accounts and the General Account, partial withdrawals,
increases in loan amount by you, loan repayments, lapse, termination for any
reason, and reinstatement. An annual statement will also be sent to you within
30 days after a Policy anniversary. The annual statement will summarize all of
the above transactions and deductions of charges during the Policy year. It will
also set forth the status of the Death Proceeds, Policy Value, Surrender Value,
amounts in the Sub-Accounts and General Account, and any Policy loans. The Owner
should review the information in all statements carefully. All errors or
corrections must be reported to the Company immediately to assure proper
crediting to the Contract. The Company will assume that all transactions are
accurately reported on confirmation statements and quarterly/annual statements
unless the Owner notifies the Principal Office in writing within 30 days after
receipt of the statement. In addition, you will be sent periodic reports
containing financial statements and

52
<PAGE>
other information for the Separate Account and the Underlying Investment
Companies as required by the 1940 Act.

LEGAL PROCEEDINGS

There are no legal proceedings pending to which the Separate Account is a party,
or to which the assets of the Separate Account are subject. The Company and
Allmerica Investments, Inc. are not involved in any litigation that is of
material importance in relation to their total assets or that relates to the
Separate Account.

FURTHER INFORMATION

A Registration Statement under the 1933 Act relating to this offering has been
filed with the SEC. Certain portions of the Registration Statement and
amendments have been omitted from this Prospectus pursuant to the rules and
regulations of the SEC. Statements contained in this Prospectus concerning the
Policy and other legal documents are summaries. The complete documents and
omitted information may be obtained from the SEC's principal office in
Washington, DC, upon payment of the SEC's prescribed fees.

INDEPENDENT ACCOUNTANTS

The financial statements of the Company as of December 31, 1999 and 1998 and for
each of the three years in the period ended December 31, 1999, and the financial
statements of Inheiritage Account of the Company as of December 31, 1999 and for
the periods indicated, included in this Prospectus constituting part of this
Registration Statement, have been so included in reliance on the reports of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

The financial statements of the Company included herein should be considered
only as bearing on the ability of the Company to meet its obligations under the
Policy.

FEDERAL TAX CONSIDERATIONS

The effect of federal income taxes on the value of the Policy, on loans,
withdrawals, or surrenders, on death benefit payments, and on the economic
benefit to the Policyowner or the Beneficiary depends upon a variety of factors.
The following discussion is based upon the Company's understanding of the
present federal income tax laws as they are currently interpreted. From time to
time legislation is proposed which, if passed, could significantly, adversely
and, possibly retroactively, affect the taxation of the Policies. No
representation is made regarding the likelihood of continuation of current
federal income tax laws or of current interpretations by the IRS. Moreover, no
attempt has been made to consider any applicable state or other tax laws.

It should be recognized that the following summary of federal income tax aspects
of amounts received under the Policies is not exhaustive, does not purport to
cover all situations, and is not intended as tax advice. Specifically, the
discussion below does not address certain tax provisions that may be applicable
if the Policyowner is a corporation or the trustee of an employee benefit plan.
A qualified tax adviser should always be consulted with regard to the
application of law to individual circumstances.

THE COMPANY AND THE SEPARATE ACCOUNT

The Company is taxed as a life insurance company under Subchapter L of the Code
and files a consolidated tax return with its parent and affiliates. The Company
does not expect to incur any income tax upon the earnings or realized capital
gains attributable to the Separate Account. Based on these expectations, no
charge is made for federal income taxes which may be attributable to the
Separate Account.

The Company will review periodically the question of a charge to the Separate
Account for federal income taxes. Such a charge may be made in future years for
any federal income taxes incurred by the Company. This might become necessary if
the tax treatment of the Company is ultimately determined to be other than what
the Company believes it to be, if there are changes made in the federal income
tax treatment of variable life insurance at the Company level, or if there is a
change in the Company's tax status. Any such charge would be designed to cover
the federal income taxes attributable to the investment results of the Separate
Account.

53
<PAGE>
Under current laws the Company may also incur state and local taxes (in addition
to premium taxes) in several states. At present these taxes are not significant.
If there is a material change in applicable state or local tax laws, charges may
be made for such taxes paid, or reserves for such taxes, attributable to the
Separate Account.

TAXATION OF THE POLICIES

The Company believes that the Policies described in this Prospectus will be
considered life insurance contracts under Section 7702 of the Code, which
generally provides for the taxation of life insurance contracts, and places
limitations on the relationship of the Policy Value to the Insurance Amount at
Risk. So long as the Policies are life insurance contracts, the Death Proceeds
payable are excludable from the gross income of the Beneficiary. Moreover, any
increase in the Policy Value is not taxable until received by the Policyowner or
the Policyowner's designee. But see "Modified Endowment Contracts." Although the
Company believes that the Policies are in compliance with Section 7702 of the
Code, the manner in which Section 7702 should be applied to certain features of
a joint survivorship life insurance contract is not directly addressed by
Section 7702. In the absence of final regulations or other guidance issued under
Section 7702, there is necessarily some uncertainty whether the Policy will meet
the Section 7702 definition of a life insurance contract. This is true
particularly if the Policyowner pays the full amount of premiums permitted under
the Policy. A Policyowner contemplating the payment of such premiums should do
so only after consulting a tax adviser. If the Policy were determined not to be
a life insurance contract under Section 7702, it would not have most of the tax
advantages normally provided by a life insurance contract.

The Code requires that the investment of each Sub-Account be adequately
diversified in accordance with Treasury Department regulations in order to be
treated as a life insurance policy for tax purposes. Although the Company does
not have control over the investments of the Underlying Funds, the Company
believes that the Underlying Funds currently meet the Treasury's diversification
requirements, and the Company will monitor continued compliance with these
requirements. In connection with the issuance of previous regulations relating
to diversification requirements, the Treasury Department announced that such
regulations do not provide guidance concerning the extent to which Policyowners
may direct their investments to particular divisions of a separate account.
Regulations in this regard may be issued in the future. It is possible that if
and when regulations are issued, the Policies may need to be modified to comply
with such regulations. For these reasons, the Policies or the Company's
administrative rules may be modified as necessary to prevent the Policyowner
from being considered the owner of the assets of the Separate Account.

Depending upon the circumstances, a surrender, partial withdrawal, change in the
Sum Insured Option, change in the Face Amount, lapse with Policy loan
outstanding, or assignment of the Policy may have tax consequences. In
particular, under specified conditions, a distribution under the Policy during
the first 15 years from Date of Issue that reduces future benefits under the
Policy will be taxed to the Policyowner as ordinary income to the extent of any
investment earnings in the Policy. Federal, state and local income, estate,
inheritance, and other tax consequences of ownership or receipt of Policy
proceeds depend on the circumstances of each Insured, Policyowner, or
Beneficiary.

SPLIT OPTION RIDER/EXCHANGE OPTION RIDER

The Split Option Rider permits the Policy to be split into two other life
insurance policies, one covering each Insured singly. A Policy split may have
adverse tax consequences. It is not clear whether the Policy split will be
treated as a non-taxable exchange under Section 1035 of the Code. Unless the
Policy split is so treated, it could result in recognition of taxable income on
the gain in the Policy. In addition, it is not clear whether, in all
circumstances, the individual policies that result from a Policy split would be
treated as life insurance policies under Section 7702 of the Code or would be
classified as modified endowment contracts. The Policyowner should consult a
competent tax adviser regarding the possible adverse tax consequences of a
Policy split.

POLICY LOANS

54
<PAGE>
present time, the IRS has not issued any guidance on whether loans with the
attributes of a preferred loan should be treated differently than a
non-preferred loan. This lack of specific guidance makes the tax treatment of
preferred loans uncertain. In the event pertinent IRS guidelines are issued in
the future, you may convert your preferred loan to a non-preferred loan.
However, it is possible that, notwithstanding the conversion, some or all of the
loan could be treated as a taxable distribution from the Policy.

Section 264 of the Code restricts the deduction of interest on Policy loans.
Consumer interest paid on Policy loans under an individually owned Policy is not
tax deductible. Generally, no tax deduction for interest is allowed on Policy
loans if the Insured is an officer or employee of, or is financially interested
in, any business carried on by the taxpayer. There is an exception to this rule
which permits a deduction for interest on loans up to $50,000 related to any
business-owned policies covering officers or 20-percent owners, up to a maximum
equal to the greater of (1) five individuals, or (2) the lesser of (a) 5% of the
total number of officers and employees of the corporation, or (b) 20
individuals.

MODIFIED ENDOWMENT CONTRACTS

The Technical and Miscellaneous Revenue Act of 1988 ("1988 Act") adversely
affects the tax treatment of distributions under so-called "modified endowment
contracts." Under the 1988 Act, any life insurance policy, including the Policy
offered by this Prospectus, that fails to satisfy a "seven-pay" test is
considered a modified endowment contract. The Policy fails to satisfy the
seven-pay test if the cumulative premiums paid under the policy at any time
during the first seven policy years, or within seven years of a material change
in the Policy, exceeds the sum of the net level premiums that would have been
paid, had the policy provided for paid-up future benefits after the payment of
seven level annual premiums. In addition, if benefits are reduced at anytime
during the life of the Policy, there may be adverse tax consequences. Please
consult your tax adviser.

If the Policy is considered a modified endowment contract, all distributions
under the Policy will be taxed on an "income-first" basis. Most distributions
received by a Policyowner directly or indirectly (including loans, withdrawals,
partial surrenders, or the assignment or pledge of any portion of the value of
the Policy) will be includible in gross income to the extent that the Surrender
Value exceeds the Policyowner's investment in the contract. Any additional
amounts will be treated as a return of capital to the extent of the
Policyowner's basis in the Policy. In addition, with certain exceptions, an
additional 10% tax will be imposed on the portion of any distribution that is
includible in income. All modified endowment contracts issued by the same
insurance company to the same Policyowner during any calendar period will be
treated as a single modified endowment contract in determining taxable
distributions.

Currently, each Policy is reviewed when premiums are received to determine if it
satisfies the seven-pay test. If the Policy does not satisfy the seven-pay test,
the Company will notify the Policyowner of the option of requesting a refund of
the excess premium. The refund process must be completed within 60 days after
the Policy anniversary, or the Policy will be permanently classified as a
modified endowment contract.

ESTATE AND GENERATION-SKIPPING TAXES

When the last surviving Insured dies, the Death Proceeds will generally be
includible in the Policyowner's estate for purposes of federal estate tax if the
last surviving Insured owned the Policy. If the Policyowner was not the last
surviving Insured, the fair market value of the Policy would be included in the
Policyowner's estate upon the Policyowner's death. Nothing would be includible
in the last surviving Insured's estate if he or she neither retained incidents
of ownership at death nor had given up ownership within three years before
death.

Federal estate tax is integrated with federal gift tax under a unified rate
schedule. In general, estates with a value less than the unifed credit amount
will not incur a federal estate tax liability. In addition, an unlimited marital
deduction may be available for federal estate and gift tax purposes. The
unlimited marital deduction permits the deferral of taxes until the death of the
surviving spouse, when the death proceeds would be available to pay taxes due
and other expenses incurred.

As a general rule, if an insured is the policyowner and death proceeds are
payable to a person two or more generations younger than the policyowner, a
generation-skipping tax may be payable on the death proceeds at

55
<PAGE>
rates similar to the maximum estate tax rate in effect at the time. If the
policyowner (whether or not he or she is an insured) transfers ownership of the
policy to someone two or more generations younger, the transfer may be subject
to the generation-skipping tax, the taxable amount being the value of the
policy. (Such a transfer is unlikely but not impossible.) If the death proceeds
are not includible in the insured's estate (because the insured retained no
incidents of ownership and did not relinquish ownership within three years
before death), the payment of the death proceeds to the beneficiary is not
subject to the generation-skipping tax regardless of the beneficiary's
generation. The generation-skipping tax provisions generally apply to transfers
which would be subject to the gift and estate tax rules. Individuals are
generally allowed an aggregate generation skipping tax exemption of $1 million.
Because these rules are complex, the policyowner should consult with a tax
adviser for specific information where benefits are passing to younger
generations.

MORE INFORMATION ABOUT THE GENERAL ACCOUNT

As discussed earlier, you may allocate Net Premiums and transfer Policy Value to
the General Account. Because of exemption and exclusionary provisions in the
securities laws, any amount in the General Account is not generally subject to
regulation under the provisions of the1933 Act or the 1940 Act. Accordingly, the
disclosures in this section have not been reviewed by the SEC. Disclosures
regarding the fixed portion of the Policy and the General Account may, however,
be subject to certain generally applicable provisions of the federal securities
laws concerning the accuracy and completeness of statements made in
prospectuses.

GENERAL DESCRIPTION

The General Account is made up of all of the general assets of the Company other
than those allocated to any separate account. Allocations to the General Account
become part of the assets of the Company, and are used to support insurance and
annuity obligations. Subject to applicable law, the Company has sole discretion
over the investment of assets of the General Account.

A portion or all of Net Premiums may be allocated or transferred to accumulate
at a fixed rate of interest in the General Account. Such net amounts are
guaranteed by the Company as to principal and a minimum rate of interest. The
allocation or transfer of funds to the General Account does not entitle you to
share in the investment experience of the General Account.

GENERAL ACCOUNT VALUE AND POLICY LOANS

The Company bears the full investment risk for amounts allocated to the General
Account, and guarantees that interest credited to each Policyowner's Policy
Value in the General Account will not be less than an annual rate of 4%
("Guaranteed Minimum Rate").

The Company may, AT ITS SOLE DISCRETION, credit a higher rate of interest
("excess interest"), although it is not obligated to credit interest in excess
of 4% per year, and might not do so. However, the excess interest rate, if any,
in effect on the date a premium is received at the Principal Office is
guaranteed on that premium for one year, unless the Policy Value associated with
the premium becomes security for a Policy loan. AFTER SUCH INITIAL ONE-YEAR
GUARANTEE OF INTEREST ON NET PREMIUM, ANY INTEREST CREDITED ON THE POLICY'S
ACCUMULATED VALUE IN THE GENERAL ACCOUNT IN EXCESS OF THE GUARANTEED MINIMUM
RATE PER YEAR WILL BE DETERMINED IN THE SOLE DISCRETION OF THE COMPANY. YOU
ASSUME THE RISK THAT INTEREST CREDITED MAY NOT EXCEED THE GUARANTEED MINIMUM
RATE.

Even if excess interest is credited to accumulated value in the General Account,
no excess interest will be credited to that portion of the Policy Value which is
equal to Debt. However, such Policy Value will be credited interest at an
effective annual yield of at least 6%.

The Company guarantees that, on each Monthly Payment Date, the Policy Value in
the General Account will be the amount of the Net Premiums allocated or Policy
Value transferred to the General Account, plus interest at an annual rate of 4%,
plus any excess interest which the Company credits, less the sum of all Policy
charges allocable to the General Account and any amounts deducted from the
General Account in connection with loans, partial withdrawals, surrenders or
transfers.

56
<PAGE>
Policy loans may also be made from the Policy Value in the General Account.

Transfers, surrenders, partial withdrawals, Death Proceeds and Policy loans
payable from the General Account may be delayed up to six months. However, if
payment is delayed for 30 days or more, the Company will pay interest at least
equal to an effective annual yield of 3.5% for the period of deferment. Amounts
from the General Account used to pay premiums on policies with the Company will
not be delayed.

THE POLICY

This Prospectus describes an individual joint survivorship flexible premium
variable life insurance policy, and is generally intended to serve as a
disclosure document only for the aspects of the Policy relating to the Separate
Account. For complete details regarding the General Account, see the Policy
itself.

TRANSFERS, SURRENDERS, AND PARTIAL WITHDRAWALS

If the Policy is surrendered or if a partial withdrawal is made, a surrender
charge or partial withdrawal charge, as applicable, may be imposed. In the event
of a decrease in the Face Amount, the surrender charge deducted is a fraction of
the charge that would apply to a full surrender of the Policy. Partial
withdrawals are made on a last-in/first-out basis from Policy Value allocated to
the General Account. This means that the last payments allocated to General
Account will be withdrawn first.

The first 12 transfers in a Policy year are free of charge. Thereafter, a $10
transfer charge will be deducted for each transfer in that Policy year. The
transfer privilege is subject to the consent of the Company and to the Company's
then current rules.

FINANCIAL STATEMENTS

Financial statements for the Company and for the Separate Account are included
in this Prospectus, beginning immediately after the Appendices. The financial
statements of the Company should be considered only as bearing on the ability of
the Company to meet its obligations under the Policy. They should not be
considered as bearing on the investment performance of the assets held in the
Separate Account.

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<PAGE>
APPENDIX A
OPTIONAL BENEFITS

This Appendix is intended to provide only a very brief overview of additional
insurance benefits available by rider. For more information, your agent should
be contacted.

The following supplemental benefits are available for issue under the Policies
for an additional charge.

SPLIT OPTION RIDER/EXCHANGE OPTION RIDER

This Rider, available only at Date of Issue, permits you to split the Policy
into two life insurance policies, one covering each Insured singly, subject
to Company guidelines.

OTHER INSURED RIDER

This Rider provides a term insurance benefit for up to five Insureds. At
present this benefit is only available for the spouse and minor children of
either primary Insured. The Rider includes a feature that allows you to
convert the "Other Insured" coverage to any permanent life insurance policy
acceptable to the Company.

FOUR-YEAR TERM RIDER

This Rider provides a term insurance benefit during the first four Policy
years, payable upon the death of the last surviving Insured during the
coverage period.

GUARANTEED DEATH BENEFIT RIDER

This Rider, WHICH IS AVAILABLE ONLY AT DATE OF ISSUE, (a) guarantees that
the Policy will not lapse, regardless of the performance of the Separate
Account, and (b) provides a guaranteed net death benefit.

Certain Riders May Not Be Available In All States.

A-1
<PAGE>
APPENDIX B
PAYMENT OPTIONS

Upon Written Request, the Surrender Value or all or part of the Death Proceeds
may be placed under one or more of the payment options below or any other option
offered by the Company. If you do not make an election, the Company will pay the
benefits in a single sum. A certificate will be provided to the payee describing
the payment option selected. If a payment option is selected, the Beneficiary
may pay to the Company any amount that would otherwise be deducted from the Sum
Insured.

The amounts payable under a payment option for each $1,000 value applied will be
the greater of: (a) the rate per $1,000 of value applied based on the Company's
non-guaranteed current payment option rates for the Policy; or (b) the rate in
the Policy for the applicable payment option.

The following payment options are currently available. The amounts payable under
these options are paid from the General Account. None is based on the investment
experience of the Separate Account.

<TABLE>
<C> <S>
Option A: PAYMENTS FOR A SPECIFIED NUMBER OF YEARS. The Company will
make equal payments for any selected number of years (not
greater than 30). Payments may be made annually, semi-
annually, quarterly or monthly.

Option B: LIFETIME MONTHLY PAYMENTS. Payments are based on the payee's
Age on the date the first payment will be made. One of three
variations may be chosen. Depending upon this choice,
payments will end:

(a) upon the death of the payee, with no further payments due
(Life Annuity);

(b) upon the death of the payee, but not before the sum of the
payments made first equals or exceeds the amount applied
under this option (Life Annuity with Installment Refund); or

(c) upon the death of the payee, but not before a selected
period (5, 10 or 20 years) has elapsed (Life Annuity with
Period Certain).

Option C: INTEREST PAYMENTS. The Company will pay interest at a rate
determined by the Company each year but which will not be
less than 3.5%. Payments may be made annually, semi-
annually, quarterly or monthly. Payments will end when the
amount left with the Company has been withdrawn. However,
payments will not continue after the death of the payee. Any
unpaid balance plus accrued interest will be paid in a lump
sum.

Option D: PAYMENTS FOR A SPECIFIED AMOUNT. Payments will be made until
the unpaid balance is exhausted. Interest will be credited
to the unpaid balance. The rate of interest will be
determined by the Company each year but will not be less
than 3.5%. Payments may be made annually, semi-annually,
quarterly or monthly. The payment level selected must
provide for the payment each year of at least 8% of the
amount applied.

Option E. LIFETIME MONTHLY PAYMENTS FOR TWO PAYEES. One of three
variations may be chosen. After the death of one payee,
payments will continue to the survivor:

(a) in the same amount as the original amount;

(b) in an amount equal to 2/3 of the original amount; or

Payments are based on the payees' ages on the date the first payment is due.
Payments will end upon the death of the surviving payee.

B-1
<PAGE>
SELECTION OF PAYMENT OPTIONS

The amount applied under any one option for any one payee must be at $5,000. The
periodic payment for any one payee must be at least $50. Subject to the
Policyowner's and/or the Beneficiary's provision, any option selection may be
changed before the Death Proceeds become payable. If the Policyowner makes no
selection, the Beneficiary may select an option when the Death Proceeds become
payable.

If the amount of monthly income payments under Option (B)(c) for the attained
Age of the payee are the same for different periods certain, the Company will
deem an election to have been made for the longest period certain which could
have been elected for such Age and amount.

The Policyowner may give the Beneficiary the right to change from Option C or D
to any other option at any time. If the payee selects Option C or D when this
policy becomes a claim, the right may be reserved to change to any other option.
The payee who elects to change options must be a payee under the option
selected.

ADDITIONAL DEPOSITS

An additional deposit may be made to any proceeds when they are applied under
Option B or E. A charge not to exceed 3% will be made. The Company may limit the
amount of this deposit.

RIGHTS AND LIMITATIONS

A payee does not have the right to assign any amount payable under any option. A
payee does not have the right to commute any amount payable under Option B or E.
A payee will have the right to commute any amount payable under Option A only if
the right is reserved in the written request selecting the option. If the right
to commute is exercised, the commuted values will be computed at the interest
rates used to calculate the benefits. The amount left under Option C, and any
unpaid balance under Option D, may be withdrawn by the payee only as set forth
in the written request selecting the option.

A corporation or fiduciary payee may select only Option A, C or D. Such
selection will be subject to the consent of the Company.

PAYMENT DATES

The first payment under any option, except Option C, will be due on the date
this Policy matures by death or otherwise, unless another date is designated.
Payments under Option C begin at the end of the first payment period.

The last payment under any option will be made as stated in the description of
that option. However, should a payee under Option B or E die prior to the due
date of the second monthly payment, the amount applied less the first monthly
payment will be paid in a lump sum or under any option other than Option E. A
lump sum payment will be made to the surviving payee under Option E or the
succeeding payee under Option B.

B-2
<PAGE>
APPENDIX C
ILLUSTRATIONS
SURRENDER VALUE, POLICY VALUES AND DEATH BENEFITS

The following tables illustrate the way in which the Policy's Sum Insured and
Policy Value could vary over an extended period of time.

ASSUMPTIONS

The tables illustrate a Policy issued on the lives of both Insureds, each
Age 55, under a standard Premium Class and qualifying for the non-smoker
discount. The tables also illustrate the guaranteed cost of insurance rates and
the current cost of insurance rates.

The tables illustrate the Policy Values that would result based upon the
assumptions that no Policy loans have been made, that you have not requested an
increase or decrease in the initial Face Amount, that no partial withdrawals
have been made, and that no transfers above 12 have been made in any Policy year
(so that no transaction or transfer charges have been incurred).

The tables assume that all premiums are allocated to and remain in the Separate
Account for the entire period shown and are based on hypothetical gross
investment rates of return for the Underlying Fund (i.e., investment income and
capital gains and losses, realized or unrealized) equivalent to constant gross
(after tax) annual rates of 0%, 6%, and 12%. The second column of the tables
shows the amount which would accumulate if an amount equal to the premiums paid
were invested each year to earn interest (after taxes) at 5% compounded
annually.

The Policy Values and Death Proceeds would be different from those shown if the
gross annual investment rates of return averaged 0%, 6%, and 12% over a period
of years, but fluctuated above or below such averages for individual Policy
years. The values would also be different depending on the allocation of the
Policy's total Policy Value among the Sub-Accounts of the Separate Account, if
the actual rates of return averaged 0%, 6% or 12%, but the rates of each
Underlying Fund varied above and below such averages.

DEDUCTIONS FOR CHARGES

The amounts shown for the Death Proceeds and Policy Values take into account the
deduction from premium for the tax expense charge, the Monthly Deduction from
Policy Value. The amounts shown also take into account the daily charge against
the Separate Account for mortality and expense risks and for the Separate
Account administrative charge (for the first 15 Policy years only). In both the
Current Cost of Insurance Charges illustrations and Guaranteed Cost of Insurance
Charges illustrations, the Separate Account charges currently are equivalent to
an effective annual rate of 1.15% of the average daily value of the assets in
the Separate Account in the first fifteen Policy Years, and 0.90% thereafter.

EXPENSES OF THE UNDERLYING FUNDS

The amounts shown in the tables also take into account the Underlying Fund
advisory fees and operating expenses, which are assumed to be at an annual rate
of 0.85% of the average daily net assets of the Underlying Fund. The actual fees
and expenses of each Underlying Fund vary, and in 1999 ranged from an annual
rate of 0.29% to an annual rate of 1.92 % of average daily net assets. The fees
and expenses associated with your Policy may be more or less than 0.85% in the
aggregate, depending upon how you make allocations of Policy Value among the
Sub-Accounts.

Until further notice, Allmerica Financial Investment Management Services, Inc.
("AFIMS") has declared a voluntary expense limitation of 1.50% of average net
assets for Select International Equity Fund, 1.35% for Select Aggressive Growth
Fund and Select Capital Appreciation Fund, 1.25% for Select Value Opportunity

C-1
<PAGE>
Fund, 1.20% for Select Growth Fund and Core Equity Fund, 1.10% for Select Growth
and Income Fund, 1.00% for Select Investment Grade Income Fund, and Government
Bond Fund, and 0.60% for Money Market Fund and Equity Index Fund. The total
operating expenses of these Funds of the Trust were less than their respective
expense limitations throughout 1999.

Until further notice, AFIMS has declared a voluntary expense limitation of 1.20%
of average daily net assets for the Select Strategic Growth Fund. In addition,
AFIMS has agreed to voluntarily waive its management fee to the extent that
expenses of the Select Emerging Markets Fund exceed 2.00% of the Fund's average
daily net assets, except that such waiver shall not exceed the net amount of
management fees earned by AFIMS from the Fund after subtracting fees paid by
AFIMS to a sub-advisor. Until further notice, the Select Value Opportunity
Fund's management fee rate has been voluntarily limited to an annual rate of
0.90% of average daily net assets, and total expenses are limited to 1.25% of
average daily net assets. The declaration of a voluntary management fee or
expense limitation in any year does not bind AFIMS to declare future expense
limitations with respect to these Funds. These limitations may be terminated at
any time.

The investment adviser for the DGPF International Equity Series is Delaware
International Advisers Ltd. ("Delaware International"). Effective May 1, 2000
through October 31, 2000, Delaware International has agreed voluntarily to waive
its management fee and reimburse the Series for expenses to the extent that
total expenses will not exceed 0.95%. This limitation replaces a prior
limitation of 0.95% that expired on April 30, 2000. The fee ratios shown above
have been restated, if necessary, to reflect the new voluntary limitation which
took effect on May 1, 2000. The declaration of a voluntary expense limitation
does not bind Delaware International to declare future expense limitations with
respect to this Series. For the fiscal year ended December 31, 1999, before
waiver and/or reimbursement by Delaware International, total fund expenses as a
percentage of average daily net assets were 0.97%.

The Underlying Fund information above was provided by the Underlying Funds and
was not independently verified by the Company.

NET ANNUAL RATES OF INVESTMENT

Taking into account the Separate Account mortality and expense risk charge of
0.90%, the Separate Account administrative charge of 0.25%, and the assumed
0.85% charge for Underlying Fund advisory fees and operating expenses, the gross
annual rates of investment return of 0%, 6%, and 12% correspond to net annual
rates of (-2.00%), 4.00% and 10.00%, respectively, during the first 15 Policy
years and (-1.75%), 4.25% and 10.25%, respectively, thereafter.

The hypothetical returns shown in the table do not reflect any charges for
income taxes against the Separate Account since no charges are currently made.
However, if in the future such charges are made, in order to produce illustrated
death benefits and Policy Values, the gross annual investment rate of return
would have to exceed 0%, 6% or 12% by a sufficient amount to cover the tax
charges.

UPON REQUEST, THE COMPANY WILL PROVIDE A COMPARABLE ILLUSTRATION BASED UPON THE
PROPOSED INSUREDS' AGES AND UNDERWRITING CLASSIFICATIONS, AND THE REQUESTED FACE
AMOUNT, SUM INSURED OPTION, AND RIDERS.

C-2
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
VARIABLE INHEIRITAGE

INSURED 1: UNISEX NON-SMOKER ISSUE AGE 55
INSURED 2: UNISEX NON-SMOKER ISSUE AGE 55
$1,000,000 SUM INSURED OPTION 1

CURRENT COST OF INSURANCE CHARGES
<TABLE>
<CAPTION>
PREMIUMS HYPOTHETICAL 0% HYPOTHETICAL 6%
PAID PLUS GROSS INVESTMENT RETURN GROSS INVESTMENT RETURN
INTEREST --------------------------------- ---------------------------------
POLICY AT 5% SURRENDER POLICY DEATH SURRENDER POLICY DEATH
YEAR PER YEAR (1) VALUE VALUE (2) BENEFIT VALUE VALUE (2) BENEFIT
- --------------------- ------------ --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 10,500 0 9,244 1,000,000 0 9,813 1,000,000
2 21,525 5,494 18,210 1,000,000 7,207 19,923 1,000,000
3 33,101 7,891 26,891 1,000,000 11,328 30,328 1,000,000
4 45,256 17,043 35,283 1,000,000 22,792 41,032 1,000,000
5 58,019 26,283 43,383 1,000,000 34,938 52,038 1,000,000
6 71,420 35,229 51,189 1,000,000 47,390 63,350 1,000,000
7 85,491 43,875 58,695 1,000,000 60,151 74,971 1,000,000
8 100,266 52,213 65,893 1,000,000 73,221 86,901 1,000,000
9 115,779 60,231 72,771 1,000,000 86,597 99,137 1,000,000
10 132,068 67,919 79,319 1,000,000 100,276 111,676 1,000,000
11 149,171 76,297 85,417 1,000,000 115,290 124,410 1,000,000
12 167,130 84,175 91,015 1,000,000 130,455 137,295 1,000,000
13 185,986 91,508 96,068 1,000,000 145,729 150,289 1,000,000
14 205,786 98,242 100,522 1,000,000 161,066 163,346 1,000,000
15 226,575 104,317 104,317 1,000,000 176,413 176,413 1,000,000
16 248,404 107,680 107,680 1,000,000 189,902 189,902 1,000,000
17 271,324 110,187 110,187 1,000,000 203,274 203,274 1,000,000
18 295,390 111,790 111,790 1,000,000 216,490 216,490 1,000,000
19 320,660 112,271 112,271 1,000,000 229,362 229,362 1,000,000
20 347,193 111,442 111,442 1,000,000 241,727 241,727 1,000,000
Age 60 58,019 26,283 43,383 1,000,000 34,938 52,038 1,000,000
Age 65 132,068 67,919 79,319 1,000,000 100,276 111,676 1,000,000
Age 70 226,575 104,317 104,317 1,000,000 176,413 176,413 1,000,000
Age 75 347,193 111,442 111,442 1,000,000 241,727 241,727 1,000,000

<CAPTION>
HYPOTHETICAL 12%
GROSS INVESTMENT RETURN
---------------------------------
POLICY SURRENDER POLICY DEATH
YEAR VALUE VALUE (2) BENEFIT
- --------------------- --------- --------- ---------
<S> <C> <C> <C>
1 0 10,383 1,000,000
2 8,989 21,704 1,000,000
3 15,047 34,047 1,000,000
4 29,264 47,504 1,000,000
5 45,078 62,178 1,000,000
6 62,226 78,186 1,000,000
7 80,833 95,653 1,000,000
8 101,037 114,717 1,000,000
9 122,984 135,524 1,000,000
10 146,842 158,242 1,000,000
11 173,831 182,951 1,000,000
12 202,975 209,815 1,000,000
13 234,463 239,023 1,000,000
14 268,509 270,789 1,000,000
15 305,354 305,354 1,000,000
16 343,785 343,785 1,000,000
17 385,737 385,737 1,000,000
18 431,628 431,628 1,000,000
19 481,839 481,839 1,000,000
20 536,864 536,864 1,000,000
Age 60 45,078 62,178 1,000,000
Age 65 146,842 158,242 1,000,000
Age 70 305,354 305,354 1,000,000
Age 75 536,864 536,864 1,000,000
</TABLE>

(1) Assumes a $10,000 premium is paid at the beginning of each Policy year.
"Premiums + Interest" column assumes premiums paid at 5% per year. Values
will be different if premiums are paid with a different frequency or in
different amounts.

(2) Assumes that no Policy loan has been made. Excessive loans or withdrawals
may cause this Policy to lapse because of insufficient Policy Value.

THE HYPOTHETICAL INVESTMENT RATES OF RETURN ARE ILLUSTRATIVE ONLY, AND SHOULD
NOT BE DEEMED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RATES OF RETURN.
ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS THAN THOSE SHOWN, AND WILL DEPEND
ON A NUMBER OF FACTORS, INCLUDING THE INVESTMENT ALLOCATIONS BY A POLICYOWNER,
AND THE DIFFERENT INVESTMENT RATES OF RETURN FOR THE UNDERLYING FUNDS. THE
SURRENDER VALUE OF UNITS, POLICY VALUE, AND DEATH BENEFIT FOR A POLICY WOULD BE
DIFFERENT FROM THOSE SHOWN IF THE ACTUAL RATES OF INVESTMENT RETURN AVERAGED 0%,
6% AND 12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE AND BELOW THOSE AVERAGES
FOR INDIVIDUAL POLICY YEARS, OR IF ANY PREMIUMS WERE ALLOCATED OR POLICY VALUE
TRANSFERRED TO THE FIXED ACCOUNT. NO REPRESENTATIONS CAN BE MADE THAT THESE
HYPOTHETICAL INVESTMENT RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR
SUSTAINED OVER ANY PERIOD OF TIME.

C-3
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
VARIABLE INHEIRITAGE

INSURED 1: UNISEX NON-SMOKER ISSUE AGE 55
INSURED 2: UNISEX NON-SMOKER ISSUE AGE 55
$1,000,000 SUM INSURED OPTION 1

GUARANTEED COST OF INSURANCE CHARGES
<TABLE>
<CAPTION>
PREMIUMS
PAID HYPOTHETICAL 0% HYPOTHETICAL 6%
PLUS GROSS INVESTMENT RETURN GROSS INVESTMENT RETURN
INTEREST --------------------------------- ---------------------------------
POLICY AT 5% SURRENDER POLICY DEATH SURRENDER POLICY DEATH
YEAR PER YEAR (1) VALUE VALUE (2) BENEFIT VALUE VALUE (2) BENEFIT
- --------------------- ------------ --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 10,500 0 9,240 1,000,000 0 9,809 1,000,000
2 21,525 5,470 18,186 1,000,000 7,182 19,898 1,000,000
3 33,101 7,819 26,819 1,000,000 11,252 30,252 1,000,000
4 45,256 16,879 35,119 1,000,000 22,617 40,857 1,000,000
5 58,019 25,962 43,062 1,000,000 34,591 51,691 1,000,000
6 71,420 34,656 50,616 1,000,000 46,765 62,725 1,000,000
7 85,491 42,919 57,739 1,000,000 59,100 73,920 1,000,000
8 100,266 50,697 64,377 1,000,000 71,542 85,222 1,000,000
9 115,779 57,914 70,454 1,000,000 84,013 96,553 1,000,000
10 132,068 64,479 75,879 1,000,000 96,419 107,819 1,000,000
11 149,171 71,437 80,557 1,000,000 109,798 118,918 1,000,000
12 167,130 77,534 84,374 1,000,000 122,889 129,729 1,000,000
13 185,986 82,661 87,221 1,000,000 135,571 140,131 1,000,000
14 205,786 86,690 88,970 1,000,000 147,704 149,984 1,000,000
15 226,575 89,468 89,468 1,000,000 159,122 159,122 1,000,000
16 248,404 88,737 88,737 1,000,000 167,728 167,728 1,000,000
17 271,324 86,156 86,156 1,000,000 175,043 175,043 1,000,000
18 295,390 81,518 81,518 1,000,000 180,839 180,839 1,000,000
19 320,660 74,231 74,231 1,000,000 184,524 184,524 1,000,000
20 347,193 63,695 63,695 1,000,000 185,487 185,487 1,000,000
Age 60 58,019 25,962 43,062 1,000,000 34,591 51,691 1,000,000
Age 65 132,068 64,479 75,879 1,000,000 96,419 107,819 1,000,000
Age 70 226,575 89,468 89,468 1,000,000 159,122 159,122 1,000,000
Age 75 347,193 63,695 63,695 1,000,000 185,487 185,487 1,000,000

HYPOTHETICAL 12%
GROSS INVESTMENT RETURN
---------------------------------
POLICY SURRENDER POLICY DEATH
YEAR VALUE VALUE (2) BENEFIT
- --------------------- --------- --------- ---------
<S> <C> <C> <C>
1 0 10,378 1,000,000
2 8,963 21,678 1,000,000
3 14,967 33,967 1,000,000
4 29,076 47,316 1,000,000
5 44,704 61,804 1,000,000
6 61,546 77,506 1,000,000
7 79,680 94,500 1,000,000
8 99,178 112,858 1,000,000
9 120,106 132,646 1,000,000
10 142,523 153,923 1,000,000
11 167,640 176,760 1,000,000
12 194,391 201,231 1,000,000
13 222,869 227,429 1,000,000
14 253,185 255,465 1,000,000
15 285,457 285,457 1,000,000
16 318,245 318,245 1,000,000
17 353,297 353,297 1,000,000
18 390,876 390,876 1,000,000
19 431,065 431,065 1,000,000
20 474,078 474,078 1,000,000
Age 60 44,704 61,804 1,000,000
Age 65 142,523 153,923 1,000,000
Age 70 285,457 285,457 1,000,000
Age 75 474,078 474,078 1,000,000
</TABLE>

(2) Assumes that no Policy loan has been made. Excessive loans or withdrawals
may cause this Policy to lapse because of insufficient Policy Value.

C-4
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
VARIABLE INHEIRITAGE

INSURED 1: UNISEX NON-SMOKER ISSUE AGE 55
INSURED 2: UNISEX NON-SMOKER ISSUE AGE 55
$1,000,000 SUM INSURED OPTION 2

CURRENT COST OF INSURANCE CHARGES
<TABLE>
<CAPTION>
PREMIUMS HYPOTHETICAL 0% HYPOTHETICAL 6%
PAID PLUS GROSS INVESTMENT RETURN GROSS INVESTMENT RETURN
INTEREST --------------------------------- ---------------------------------
POLICY AT 5% SURRENDER POLICY DEATH SURRENDER POLICY DEATH
YEAR PER YEAR (1) VALUE VALUE (2) BENEFIT VALUE VALUE (2) BENEFIT
- --------------------- ------------ --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 10,500 0 9,244 1,009,244 0 9,813 1,009,813
2 21,525 5,491 18,207 1,018,207 7,204 19,919 1,019,919
3 33,101 7,881 26,881 1,026,881 11,317 30,317 1,030,317
4 45,256 17,020 35,260 1,035,260 22,765 41,005 1,041,005
5 58,019 26,239 43,339 1,043,339 34,883 51,983 1,051,983
6 71,420 35,152 51,112 1,051,112 47,292 63,252 1,063,252
7 85,491 43,751 58,571 1,058,571 59,987 74,807 1,074,807
8 100,266 52,025 65,705 1,065,705 72,964 86,644 1,086,644
9 115,779 59,959 72,499 1,072,499 86,210 98,750 1,098,750
10 132,068 67,540 78,940 1,078,940 99,715 111,115 1,111,115
11 149,171 75,772 84,892 1,084,892 114,484 123,604 1,123,604
12 167,130 83,458 90,298 1,090,298 129,311 136,151 1,136,151
13 185,986 90,540 95,100 1,095,100 144,128 148,688 1,148,688
14 205,786 96,959 99,239 1,099,239 158,861 161,141 1,161,141
15 226,575 102,641 102,641 1,102,641 173,416 173,416 1,173,416
16 248,404 105,518 105,518 1,105,518 185,878 185,878 1,185,878
17 271,324 107,430 107,430 1,107,430 197,926 197,926 1,197,926
18 295,390 108,322 108,322 1,108,322 209,467 209,467 1,209,467
19 320,660 107,952 107,952 1,107,952 220,211 220,211 1,220,211
20 347,193 106,114 106,114 1,106,114 229,890 229,890 1,229,890
Age 60 58,019 26,239 43,339 1,043,339 34,883 51,983 1,051,983
Age 65 132,068 67,540 78,940 1,078,940 99,715 111,115 1,111,115
Age 70 226,575 102,641 102,641 1,102,641 173,416 173,416 1,173,416
Age 75 347,193 106,114 106,114 1,106,114 229,890 229,890 1,229,890

<CAPTION>
HYPOTHETICAL 12%
GROSS INVESTMENT RETURN
---------------------------------
POLICY SURRENDER POLICY DEATH
YEAR VALUE VALUE (2) BENEFIT
- --------------------- --------- --------- ---------
<S> <C> <C> <C>
1 0 10,382 1,010,382
2 8,985 21,700 1,021,700
3 15,034 34,034 1,034,034
4 29,232 47,472 1,047,472
5 45,011 62,111 1,062,111
6 62,101 78,061 1,078,061
7 80,618 95,438 1,095,438
8 100,685 114,365 1,114,365
9 122,435 134,975 1,134,975
10 146,013 157,413 1,157,413
11 172,593 181,713 1,181,713
12 201,147 207,987 1,207,987
13 231,802 236,362 1,236,362
14 264,689 266,969 1,266,969
15 299,940 299,940 1,299,940
16 336,198 336,198 1,336,198
17 375,199 375,199 1,375,199
18 417,146 417,146 1,417,146
19 462,066 462,066 1,462,066
20 510,021 510,021 1,510,021
Age 60 45,011 62,111 1,062,111
Age 65 146,013 157,413 1,157,413
Age 70 299,940 299,940 1,299,940
Age 75 510,021 510,021 1,510,021
</TABLE>

(2) Assumes that no Policy loan has been made. Excessive loans or withdrawals
may cause this Policy to lapse because of insufficient Policy Value.

C-5
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
VARIABLE INHEIRITAGE

INSURED 1: UNISEX NON-SMOKER ISSUE AGE 55
INSURED 2: UNISEX NON-SMOKER ISSUE AGE 55
$1,000,000 SUM INSURED OPTION 2

GUARANTEED COST OF INSURANCE CHARGES
<TABLE>
<CAPTION>
PREMIUMS
PAID HYPOTHETICAL 0% HYPOTHETICAL 6%
PLUS GROSS INVESTMENT RETURN GROSS INVESTMENT RETURN
INTEREST --------------------------------- ---------------------------------
POLICY AT 5% SURRENDER POLICY DEATH SURRENDER POLICY DEATH
YEAR PER YEAR (1) VALUE VALUE (2) BENEFIT VALUE VALUE (2) BENEFIT
- --------------------- ------------ --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 10,500 0 9,240 1,009,240 0 9,809 1,009,809
2 21,525 5,467 18,182 1,018,182 7,179 19,894 1,019,894
3 33,101 7,807 26,807 1,026,807 11,239 30,239 1,030,239
4 45,256 16,851 35,091 1,035,091 22,583 40,823 1,040,823
5 58,019 25,905 43,005 1,043,005 34,521 51,621 1,051,621
6 71,420 34,552 50,512 1,050,512 46,634 62,594 1,062,594
7 85,491 42,745 57,565 1,057,565 58,871 73,691 1,073,691
8 100,266 50,421 64,101 1,064,101 71,165 84,845 1,084,845
9 115,779 57,494 70,034 1,070,034 83,416 95,956 1,095,956
10 132,068 63,859 75,259 1,075,259 95,504 106,904 1,106,904
11 149,171 70,549 79,669 1,079,669 108,435 117,555 1,117,555
12 167,130 76,295 83,135 1,083,135 120,908 127,748 1,127,748
13 185,986 80,971 85,531 1,085,531 132,757 137,317 1,137,317
14 205,786 84,438 86,718 1,086,718 143,788 146,068 1,146,068
15 226,575 86,532 86,532 1,086,532 153,776 153,776 1,153,776
16 248,404 84,970 84,970 1,084,970 160,529 160,529 1,160,529
17 271,324 81,398 81,398 1,081,398 165,464 165,464 1,165,464
18 295,390 75,625 75,625 1,075,625 168,273 168,273 1,168,273
19 320,660 67,062 67,062 1,067,062 168,214 168,214 1,168,214
20 347,193 55,157 55,157 1,055,157 164,547 164,547 1,164,547
Age 60 58,019 25,905 43,005 1,043,005 34,521 51,621 1,051,621
Age 65 132,068 63,859 75,259 1,075,259 95,504 106,904 1,106,904
Age 70 226,575 86,532 86,532 1,086,532 153,776 153,776 1,153,776
Age 75 347,193 55,157 55,157 1,055,157 164,547 164,547 1,164,547

HYPOTHETICAL 12%
GROSS INVESTMENT RETURN
---------------------------------
POLICY SURRENDER POLICY DEATH
YEAR VALUE VALUE (2) BENEFIT
- --------------------- --------- --------- ---------
<S> <C> <C> <C>
1 0 10,378 1,010,378
2 8,959 21,674 1,021,674
3 14,952 33,952 1,033,952
4 29,038 47,278 1,047,278
5 44,619 61,719 1,061,719
6 61,380 77,340 1,077,340
7 79,379 94,199 1,094,199
8 98,664 112,344 1,112,344
9 119,259 131,799 1,131,799
10 141,174 152,574 1,152,574
11 165,549 174,669 1,174,669
12 191,221 198,061 1,198,061
13 218,168 222,728 1,222,728
14 246,345 248,625 1,248,625
15 275,674 275,674 1,275,674
16 304,418 304,418 1,304,418
17 333,938 333,938 1,333,938
18 364,075 364,075 1,364,075
19 394,222 394,222 1,394,222
20 423,741 423,741 1,423,741
Age 60 44,619 61,719 1,061,719
Age 65 141,174 152,574 1,152,574
Age 70 275,674 275,674 1,275,674
Age 75 423,741 423,741 1,423,741
</TABLE>

(2) Assumes that no Policy loan has been made. Excessive loans or withdrawals
may cause this Policy to lapse because of insufficient Policy Value.

C-6
<PAGE>
APPENDIX D
CALCULATION OF MAXIMUM SURRENDER CHARGES

A separate surrender charge is calculated upon issuance of the Policy and upon
each increase in Face Amount. The maximum surrender charge is equal to the sum
of (a) plus (b), where (a) is a deferred administrative charge equal to $8.50
per $1,000 of initial Face Amount (or Face Amount increase), and (b) is a
deferred sales charge of 48% of premiums received up to a maximum number of
Guideline Annual Premiums (GAPs), based on the joint life expectancy of both
Insureds, subject to the deferred sales charge that varies as shown below by
average issue Age or average Age at time of increase, as applicable:

<TABLE>
<CAPTION>
APPLICABLE AGE MAXIMUM GAPS
- -------------- ---------------
<S> <C>
5-75 1.95
76 1.92
77 1.81
78 1.69
79 1.60
80 1.50
81 1.40
82 1.31
</TABLE>

A further limitation is imposed based on the Standard Nonforfeiture Law of each
state. The maximum surrender charges upon issuance of the Policy and upon each
increase in Face Amount are shown in the table below. During the first two
Policy years following issue or an increase in the Face Amount, the actual
surrender charge may be less than the maximum. See CHARGES AND DEDUCTIONS --
"Surrender Charge."

The maximum surrender charge initially remains level for 40 months, declines by
one-half of one percent of the initial amount for 80 months, and then declines
by one percent each month thereafter, reaching zero at the end of 180 Policy
months (15 Policy years). The factors used in calculating the maximum surrender
charges vary with the issue Age of the younger Insured as indicated in the table
that follows:

INITIAL MAXIMUM SURRENDER CHARGE PER $1,000 FACE AMOUNT

<TABLE>
<CAPTION>
Younger Initial Younger Initial Younger Initial
Issue Surrender Issue Surrender Issue Surrender
Age Charge Age Charge Age Charge
- ------- --------- ------- --------- ------- ---------
<S> <C> <C> <C> <C> <C>
5 5.00 31 9.40 57 21.00
6 5.00 32 9.80 58 22.00
7 5.00 33 10.20 59 23.00
8 5.00 34 10.60 60 24.00
9 5.00 35 11.00 61 25.00
10 5.00 36 11.40 62 26.00
11 5.00 37 11.80 63 27.00
12 5.00 38 12.20 64 28.00
13 5.00 39 12.60 65 29.00
14 5.00 40 13.00 66 30.00
15 5.00 41 13.40 67 31.00
16 5.00 42 13.80 68 32.00
17 5.00 43 14.20 69 33.00
18 5.00 44 14.60 70 34.00
19 5.00 45 15.00 71 35.00
20 5.00 46 15.40 72 35.00
21 5.40 47 15.80 73 35.00
22 5.80 48 16.20 74 35.00
23 6.20 49 16.60 75 35.00
</TABLE>

D-1
<PAGE>

EXAMPLES

For the purposes of these examples, assume that two non-smokers, each Age 55,
are covered as the Insureds under a $1,000,000 Policy. In this example the
Guideline Annual Premium ("GAP") equals $16,861.10. The maximum surrender charge
for the policy is calculated as follows:

(a)Deferred Administrative Charge $8,500.00
($8.50/$1,000 of Face Amount)

(b) Deferred Sales Charge $15,781.99
(48% X 1.95 GAPs)

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

TOTAL $24,281.99

Maximum Surrender Charge per Table (19.00 X 1,000) $19,000.00

During the first two Policy years after the Date of Issue, the actual surrender
charge is the smaller of the maximum surrender charge and the following sum:

(a)Deferred Administrative Charge $8,500.00
($8.50/$1,000 of Face Amount)

(b)Deferred Sales Charge Varies
(not to exceed 25% of Premiums received,
subject to the deferred sales charge)

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

Sum of (a) and (b)

The maximum surrender charge is $19,000. All premiums are associated with the
initial Face Amount unless the Face Amount is increased.

EXAMPLE 1:

Assume the Policyowner surrenders the Policy in the 10th policy month, having
paid total premiums of $7,500. The actual surrender charge would be $10,375.

EXAMPLE 2:

Assume the Policyowner surrenders the Policy in the 120th month. After the 40th
Policy month, the maximum surrender charge decreases by 0.5% per month during
this period ($95 per month in this example). In this example, the maximum
surrender charge would be $11,400.

D-2
<PAGE>
APPENDIX E
PERFORMANCE INFORMATION

The Policies were first offered to the public in 1994. The Company, however, may
advertise "Total Return" and "Average Annual Total Return" performance
information based on the periods that the Sub-Accounts have been in existence
(Tables I(A) and I(B)), and based on the periods that the Underlying Funds have
been in existence (Tables II(A) and II(B)). The results for any period prior to
the Policies being offered will be calculated as if the Policies had been
offered during that period of time, with all charges assumed to be those
applicable to the Sub-Accounts, the Underlying Funds, and (in TABLES I(A) and
II(A) under a "representative" Policy that is surrendered at the end of the
applicable period. For more information on charges under the Policy, see CHARGES
AND DEDUCTIONS.

Performance information may be compared, in reports and promotional literature,
to: (1) the Standard & Poor's 500 Composite Stock Price Index ("S&P 500"), Dow
Jones Industrial Average ("DJIA"), Shearson Lehman Aggregate Bond Index or other
unmanaged indices so that investors may compare results with those of a group of
unmanaged securities widely regarded by investors as representative of the
securities markets in general; (2) other groups of variable life separate
accounts or other investment products tracked by Lipper Analytical Services, a
widely used independent research firm which ranks mutual funds and other
investment products by overall performance, investment objectives, and assets,
or tracked by other services, companies, publications, or persons, such as
Morningstar, Inc., who rank such investment products on overall performance or
other criteria; or (3) the Consumer Price Index (a measure for inflation) to
assess the real rate of return from an investment. Unmanaged indices may assume
the reinvestment of dividends but generally do not reflect deductions for
administrative and management costs and expenses.

At times, the Company also may advertise the ratings and other information
assigned to it by independent rating organizations such as A.M. Best Company
("A.M. Best"), Moody's Investors Services ("Moody's"), Standard & Poor's
Insurance Rating Services ("S&P"), and Duff & Phelps. A.M. Best's and Moody's
ratings reflect their current opinions of the Company's relative financial
strength and operating performance in comparison to the norms of the life/health
insurance industry. S&P's and Duff & Phelps' ratings measure the ability of an
insurance company to meet its obligations under insurance policies it issues,
and do not measure the ability of such companies to meet other non-policy
obligations. The ratings also do not relate to the performance of the Underlying
Funds.

The Company may provide information on various topics of interest to
Policyowners and prospective Policyowners in sales literature, periodic
publications or other materials. These topics may include the relationship
between sectors of the economy and the economy as a whole and its effect on
various securities markets, investment strategies and techniques (such as value
investing, market timing, dollar cost averaging, asset allocation, constant
ratio transfer and account rebalancing), the advantages and disadvantages of
investing in tax-deferred and taxable investments, customer profiles and
hypothetical purchase and investment scenarios, financial management and tax and
retirement planning, and investment alternatives to certificates of deposit and
other financial instruments.

In each table below, "One-Year Total Return" refers to the total of the income
generated by a Sub-Account, based on certain charges and assumptions as
described in the respective tables, for the one-year period ended December 31,
1999. "Average Annual Total Return" is based on the same charges and
assumptions, but reflects the hypothetical annually compounded return that would
have produced the same cumulative return if the Sub-Account's performance had
been constant over the entire period. Because average annual total returns tend
to smooth out variations in annual performance return, they are not the same as
actual year-by-year results.

E-1
<PAGE>
TABLE I(A)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING DECEMBER 31, 1999
SINCE INCEPTION OF THE SUB-ACCOUNTS
NET OF ALL CHARGES AND ASSUMING SURRENDER OF THE POLICY

The following performance information is based on the periods that the
Underlying Funds have been in existence. The data is net of expenses of the
Underlying Funds, all Sub-Account charges, and all Policy charges (including
surrender charges) for a representative Policy. It is assumed that the Insureds
are male, Age 45, standard (nonsmoker) Premium Class, and female, Age 43,
standard (nonsmoker) Premium Class, that the Face Amount of the Policy is
$500,000, that an annual premium payment of $5,500 (approximately one Guideline
Annual Premium) was made at the beginning of each Policy year, that ALL premiums
were allocated to EACH Sub-Account individually, and that there was a full
surrender of the Policy at the end of the applicable period.

<TABLE>
10 YEARS
ONE-YEAR OR LIFE
TOTAL 5 OF SUB-ACCOUNT
UNDERLYING FUND RETURN YEARS (IF LESS)
<S> <C> <C> <C>
Select Aggressive Growth Fund -66.90% 14.72% 12.57%
Select Capital Appreciation Fund -79.37% N/A 10.98%
Select Value Opportunity Fund -100.00% 3.58% 3.10%
Select Emerging Markets Fund -41.53% N/A -33.28%
T. Rowe Price International Stock Portfolio -71.91% N/A 3.83%
Fidelity VIP Overseas Portfolio -63.18% 8.01% 6.55%
Select International Equity Fund -73.41% 9.35% 7.70%
DGPF International Equity Series -88.36% 3.22% 2.99%
Fidelity VIP Growth Portfolio -68.05% 21.76% 20.77%
Select Growth Fund -75.21% 21.05% 19.08%
Select Strategic Growth Fund -88.08% N/A -43.21%
Core Equity Fund -75.64% 16.85% 15.99%
Equity Index Fund -84.00% 19.64% 18.03%
Fidelity VIP Equity-Income Portfolio -97.20% 9.41% 9.95%
Select Growth and Income Fund -85.86% 12.90% 12.15%
Fidelity VIP II Asset Manager Portfolio -92.74% 6.00% 5.54%
Fidelity VIP High Income Portfolio -95.49% 0.44% 0.80%
Select Investment Grade Income Fund -100.00% -3.72% -2.58%
Government Bond Fund -100.00% -5.12% -4.03%
Money Market Fund -98.27% -6.05% -4.23%
</TABLE>

The inception dates for the Sub-Accounts are: 5/26/94 for Money Market; 9/19/94
for Equity Index; 6/30/94 for Government Bond; 4/25/94 for Select Aggressive
Growth; 5/19/94 for Select Growth; 6/1/94 for Select Value Opportunity; 5/3/94
for Select International Equity; 4/30/95 for Select Capital Appreciation; 5/1/94
for Fidelity VIP Equity-Income, Select Growth and Income, and Select Investment
Grade Income; 5/11/94 for Fidelity VIP Growth, Core Equity, Fidelity VIP II
Asset Manager, and DGPF International Equity; 5/12/94 for Fidelity VIP High
Income; 4/28/94 for Fidelity VIP Overseas; 7/2/95 for T. Rowe Price
International Stock; and 2/20/98 for Select Emerging Markets and Select
Strategic Growth.

PERFORMANCE INFORMATION REFLECTS ONLY THE PERFORMANCE OF A HYPOTHETICAL
INVESTMENT DURING THE PARTICULAR TIME PERIOD ON WHICH THE CALCULATIONS ARE
BASED. ONE-YEAR TOTAL RETURN AND AVERAGE ANNUAL TOTAL RETURN FIGURES ARE BASED
ON HISTORICAL EARNINGS AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE.
PERFORMANCE INFORMATION SHOULD BE CONSIDERED IN LIGHT OF THE INVESTMENT
OBJECTIVES AND POLICIES, CHARACTERISTICS AND QUALITY OF THE PORTFOLIO OF THE
UNDERLYING FUND IN WHICH A SUB-ACCOUNT INVESTS AND THE MARKET CONDITIONS DURING
THE GIVEN TIME PERIOD, AND SHOULD NOT BE CONSIDERED AS A REPRESENTATION OF WHAT
MAY BE ACHIEVED IN THE FUTURE.

E-2
<PAGE>
TABLE I(B)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING DECEMBER 31, 1999
SINCE INCEPTION OF THE SUB-ACCOUNTS
EXCLUDING MONTHLY POLICY CHARGES AND SURRENDER CHARGES

The following performance information is based on the periods that the
Sub-Accounts have been in existence. The performance information is net of total
Underlying Fund expenses and all Sub-Account charges. THE DATA DOES NOT REFLECT
MONTHLY CHARGES UNDER THE POLICY OR SURRENDER CHARGES. It is assumed that an
annual premium payment of $5,500 (approximately one Guideline Annual Premium)
was made at the beginning of each Policy year and that ALL premiums were
allocated to EACH Sub-Account individually.

<TABLE>
10 YEARS
ONE-YEAR OR LIFE
TOTAL 5 OF SUB-ACCOUNT
UNDERLYING FUND RETURN YEARS (IF LESS)
<S> <C> <C> <C>
Select Aggressive Growth Fund 37.07% 21.93% 18.45%
Select Capital Appreciation Fund 23.92% N/A 20.03%
Select Value Opportunity Fund -5.79% 12.24% 10.38%
Select Emerging Markets Fund 63.82% N/A 13.89%
T. Rowe Price International Stock Portfolio 31.79% N/A 14.71%
Fidelity VIP Overseas Portfolio 40.99% 16.04% 13.14%
Select International Equity Fund 30.20% 17.21% 14.18%
DGPF International Equity Series 14.43% 11.94% 10.14%
Fidelity VIP Growth Portfolio 35.86% 28.26% 25.99%
Select Growth Fund 28.31% 27.61% 24.49%
Select Strategic Growth Fund 14.73% N/A 5.68%
Core Equity Fund 27.85% 23.83% 21.63%
Equity Index Fund 19.03% 26.34% 24.27%
Fidelity VIP Equity-Income Portfolio 5.11% 17.26% 16.15%
Select Growth and Income Fund 17.07% 20.32% 18.11%
Fidelity VIP II Asset Manager Portfolio 9.81% 14.31% 12.34%
Fidelity VIP High Income Portfolio 6.91% 9.60% 8.27%
Select Investment Grade Income Fund -2.11% 6.16% 5.35%
Government Bond Fund -0.92% 5.02% 4.58%
Money Market Fund 3.98% 4.27% 4.16%
</TABLE>

The inception dates for the Sub-Accounts are: 5/26/94 for Money Market; 9/19/94
for Equity Index; 6/30/94 for Government Bond; 4/25/94 for Select Aggressive
Growth; 5/19/94 for Select Growth; 6/1/94 for Select Value Opportunity; 5/3/94
for Select International Equity; 4/30/95 for Select Capital Appreciation; 5/2/94
for Fidelity VIP Equity-Income, Select Growth and Income, and Select Investment
Grade Income; 5/11/94 for Fidelity VIP Growth, Core Equity, Fidelity VIP II
Asset Manager, and DGPF International Equity; 5/12/94 for Fidelity VIP High
Income; 4/28/94 for Fidelity VIP Overseas; 7/2/95 for T. Rowe Price
International Stock; and 2/20/98 for Select Emerging Markets and Select
Strategic Growth.

E-3
<PAGE>
TABLE II(A)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING DECEMBER 31, 1999
SINCE INCEPTION OF THE UNDERLYING FUNDS
NET OF ALL CHARGES AND ASSUMING SURRENDER OF THE POLICY

<TABLE>
10 YEARS
ONE-YEAR OR LIFE
TOTAL 5 OF FUND
UNDERLYING FUND RETURN YEARS (IF LESS)
<S> <C> <C> <C>
Select Aggressive Growth Fund -66.90% 14.72% 16.15%
Select Capital Appreciation Fund -79.37% N/A 10.98%
Select Value Opportunity Fund -100.00% 3.58% 5.39%
Select Emerging Markets Fund -41.53% N/A -33.28%
T. Rowe Price International Stock Portfolio -71.91% 5.50% 5.62%
Fidelity VIP Overseas Portfolio -63.18% 8.01% 8.10%
Select International Equity Fund -73.41% 9.35% 7.70%
DGPF International Equity Series -88.36% 3.22% 6.72%
Fidelity VIP Growth Portfolio -68.05% 21.76% 16.91%
Select Growth Fund -75.21% 21.05% 16.00%
Select Strategic Growth Fund -88.08% N/A -43.21%
Core Equity Fund -75.64% 16.85% 14.21%
Equity Index Fund -84.00% 19.64% 17.36%
Fidelity VIP Equity-Income Portfolio -97.20% 9.41% 11.38%
Select Growth and Income Fund -85.86% 12.90% 11.05%
Fidelity VIP II Asset Manager Portfolio -92.74% 6.00% 9.89%
Fidelity VIP High Income Portfolio -95.49% 0.44% 9.15%
Select Investment Grade Income Fund -100.00% -3.72% 4.13%
Government Bond Fund -100.00% -5.12% 1.46%
Money Market Fund -98.27% -6.05% 1.50%
</TABLE>

The inception dates for the Underlying Funds are: 4/29/85 for Core Equity,
Select Investment Grade Income and Money Market; 9/28/90 for Equity Index;
8/26/91 for Government Bond; 8/21/92 for Select Aggressive Growth, Select
Growth, and Select Growth and Income; 4/30/93 for Select Value Opportunity;
5/2/94 for Select International Equity; 4/28/95 for Select Capital Appreciation;
10/09/86 for Fidelity VIP Equity-Income and Fidelity VIP Growth; 9/19/85 for
Fidelity VIP High Income; 1/28/87 for Fidelity VIP Overseas; 9/6/89 for Fidelity
VIP II Asset Manager; 10/29/92 for DGPF International Equity; 3/31/94 for T.
Rowe Price International Stock; and 2/20/98 for Select Emerging Markets and
Select Strategic Growth.

E-4
<PAGE>
TABLE II(B)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDING DECEMBER 31, 1999
SINCE INCEPTION OF THE UNDERLYING FUNDS
EXCLUDING MONTHLY POLICY CHARGES AND SURRENDER CHARGES

The following performance information is based on the periods that the
Underlying Funds have been in existence. The performance information is net of
total Underlying Fund expenses and all Sub-Account charges. THE DATA DOES NOT
REFLECT MONTHLY CHARGES UNDER THE POLICY OR SURRENDER CHARGES. It is assumed
that an annual premium payment of $5,500 (approximately one Guideline Annual
Premium) was made at the beginning of each Policy year and that ALL premiums
were allocated to EACH Sub-Account individually.

<TABLE>
10 YEARS
ONE-YEAR OR LIFE
TOTAL 5 OF FUND
UNDERLYING FUND RETURN YEARS (IF LESS)
<S> <C> <C> <C>
Select Aggressive Growth Fund 37.07% 21.93% 19.33%
Select Capital Appreciation Fund 23.92% N/A 20.03%
Select Value Opportunity Fund -5.79% 12.24% 10.30%
Select Emerging Markets Fund 63.82% N/A 13.89%
T. Rowe Price International Stock Portfolio 31.79% 13.88% 12.13%
Fidelity VIP Overseas Portfolio 40.99% 16.04% 10.17%
Select International Equity Fund 30.20% 17.21% 14.17%
DGPF International Equity Series 14.43% 11.94% 10.82%
Fidelity VIP Growth Portfolio 35.86% 28.26% 18.58%
Select Growth Fund 28.31% 27.61% 19.19%
Select Strategic Growth Fund 14.73% N/A 5.68%
Core Equity Fund 27.85% 23.83% 15.98%
Equity Index Fund 19.03% 26.34% 19.29%
Fidelity VIP Equity-Income Portfolio 5.11% 17.26% 13.28%
Select Growth and Income Fund 17.07% 20.32% 14.59%
Fidelity VIP II Asset Manager Portfolio 9.81% 14.31% 11.86%
Fidelity VIP High Income Portfolio 6.91% 9.60% 11.16%
Select Investment Grade Income Fund -2.11% 6.16% 6.46%
Government Bond Fund -0.92% 5.02% 5.00%
Money Market Fund 3.98% 4.27% 4.04%
</TABLE>

E-5
<PAGE>
ALLMERICA FINANCIAL
LIFE INSURANCE AND
ANNUITY COMPANY

CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholder of
Allmerica Financial Life Insurance and Annuity Company

In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, comprehensive income, shareholder's equity
and cash flows present fairly, in all material respects, the financial position
of Allmerica Financial Life Insurance and Annuity Company (the "Company") at
December 31, 1999 and 1998, and the results of their operations and their cash
flows for each of the three years in the period ended December 31, 1999, in
conformity with accounting principles generally accepted in the United States.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
auditing standards generally accepted in the United States which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.

/s/ PRICEWATERHOUSECOOPERS LLP

Boston, Massachusetts
February 1, 2000
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
------------- ---- ---- ----
<S> <C> <C> <C>
REVENUES
Premiums................................... $ 0.5 $ 0.5 $ 22.8
Universal life and investment product
policy fees.............................. 328.1 267.4 212.2
Net investment income...................... 150.2 151.3 164.2
Net realized investment (losses) gains..... (8.7) 20.0 2.9
Other income............................... 36.9 0.6 1.4
------ ------ ------
Total revenues......................... 507.0 439.8 403.5
------ ------ ------
BENEFITS, LOSSES AND EXPENSES
Policy benefits, claims and losses......... 173.6 153.9 187.8
Policy acquisition expenses................ 49.8 64.6 2.8
Sales practice litigation.................. -- 21.0 --
Loss from cession of disability income
business................................. -- -- 53.9
Other operating expenses................... 151.3 104.1 101.3
------ ------ ------
Total benefits, losses and expenses.... 374.7 343.6 345.8
------ ------ ------
Income before federal income taxes............. 132.3 96.2 57.7
------ ------ ------
FEDERAL INCOME TAX EXPENSE
Current.................................... 15.5 22.1 13.9
Deferred................................... 30.5 11.8 7.1
------ ------ ------
Total federal income tax expense....... 46.0 33.9 21.0
------ ------ ------
Net income..................................... $ 86.3 $ 62.3 $ 36.7
====== ====== ======
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

F-1
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
(IN MILLIONS, EXCEPT PER SHARE DATA) 1999 1998
------------------------------------ --------- ---------
<S> <C> <C>
ASSETS
Investments:
Fixed maturities at fair value (amortized cost of
$1,354.2 and $1,284.6)............................ $ 1,324.6 $ 1,330.4
Equity securities at fair value (cost of $25.2 and
$27.4)............................................ 32.6 31.8
Mortgage loans...................................... 223.7 230.0
Policy loans........................................ 166.8 151.5
Real estate and other long-term investments......... 25.1 23.6
--------- ---------
Total investments............................... 1,772.8 1,767.3
--------- ---------
Cash and cash equivalents............................. 132.9 217.9
Accrued investment income............................. 36.0 33.5
Deferred policy acquisition costs..................... 1,156.4 950.5
Reinsurance receivable on paid and unpaid losses,
benefits and unearned premiums...................... 287.2 308.0
Other assets.......................................... 64.8 46.9
Separate account assets............................... 14,527.9 11,020.4
--------- ---------
Total assets.................................... $17,978.0 $14,344.5
========= =========
LIABILITIES
Policy liabilities and accruals:
Future policy benefits.............................. $ 2,274.7 $ 2,284.8
Outstanding claims and losses....................... 13.7 17.9
Unearned premiums................................... 2.6 2.7
Contractholder deposit funds and other policy
liabilities....................................... 44.3 38.1
--------- ---------
Total policy liabilities and accruals........... 2,335.3 2,343.5
--------- ---------
Expenses and taxes payable............................ 216.8 146.2
Reinsurance premiums payable.......................... 17.9 45.7
Deferred federal income taxes......................... 94.8 78.8
Separate account liabilities.......................... 14,527.9 11,020.4
--------- ---------
Total liabilities............................... 17,192.7 13,634.6
--------- ---------
Contingencies (Note 12)
SHAREHOLDER'S EQUITY
Common stock, $1,000 par value, 10,000 shares
authorized, 2,526 and 2,524 shares, issued and
outstanding......................................... 2.5 2.5
Additional paid-in capital............................ 423.7 407.9
Accumulated other comprehensive (loss) income......... (2.6) 24.1
Retained earnings..................................... 361.7 275.4
--------- ---------
Total shareholder's equity...................... 785.3 709.9
--------- ---------
Total liabilities and shareholder's equity...... $17,978.0 $14,344.5
========= =========
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

F-2
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
------------- ------- ------- -------
<S> <C> <C> <C>
COMMON STOCK................................... $ 2.5 $ 2.5 $ 2.5
------ ------ ------

ADDITIONAL PAID-IN CAPITAL
Balance at beginning of period............. 407.9 386.9 346.3
Issuance of common stock................... 15.8 21.0 40.6
------ ------ ------
Balance at end of period................... 423.7 407.9 386.9
------ ------ ------
ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME
Net unrealized (depreciation) appreciation
on investments:
Balance at beginning of period............. 24.1 38.5 20.5
(Depreciation) appreciation during the
period:
Net (depreciation) appreciation on
available-for-sale securities........ (41.1) (23.4) 27.0
Benefit (provision) for deferred
federal income taxes................. 14.4 9.0 (9.0)
------ ------ ------
(26.7) (14.4) 18.0
------ ------ ------
Balance at end of period................... (2.6) 24.1 38.5
------ ------ ------
RETAINED EARNINGS
Balance at beginning of period............. 275.4 213.1 176.4
Net income................................. 86.3 62.3 36.7
------ ------ ------
Balance at end of period................... 361.7 275.4 213.1
------ ------ ------
Total shareholder's equity............. $785.3 $709.9 $641.0
====== ====== ======
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

F-3
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
------------- ------ ------ ------
<S> <C> <C> <C>
Net income.................................. $ 86.3 $ 62.3 $36.7
Other comprehensive (loss) income:
Net (depreciation) appreciation on
available-for-sale securities......... (41.1) (23.4) 27.0
Benefit (provision) for deferred federal
income taxes.......................... 14.4 9.0 (9.0)
------ ------ -----
Other comprehensive (loss) income... (26.7) (14.4) 18.0
------ ------ -----
Comprehensive income.................... $ 59.6 $ 47.9 $54.7
====== ====== =====
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

F-4
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
------------- ------- ------- -------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income.............................. $ 86.3 $ 62.3 $ 36.7
Adjustments to reconcile net income to
net cash used in operating activities:
Net realized losses/(gains)......... 8.7 (20.0) (2.9)
Net amortization and depreciation... (2.3) (7.1) --
Sales practice litigation expense... -- 21.0 --
Loss from cession of disability
income business................... -- -- 53.9
Deferred federal income taxes....... 30.5 11.8 7.1
Payment related to cession of
disability income business........ -- -- (207.0)
Change in deferred acquisition
costs............................. (169.7) (177.8) (181.3)
Change in reinsurance premiums
payable........................... (31.5) 40.8 3.9
Change in accrued investment
income............................ (2.5) 0.7 3.5
Change in policy liabilities and
accruals, net..................... (8.4) 193.1 (72.4)
Change in reinsurance receivable.... 20.7 (56.9) 22.1
Change in expenses and taxes
payable........................... 64.1 55.4 0.2
Other, net.......................... (14.8) (28.5) (7.1)
------- ------- -------
Net cash (used in) provided by
operating activities.......... (18.9) 94.8 (343.3)
------- ------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposals and maturities
of available-for-sale fixed
maturities............................ 330.9 187.0 909.7
Proceeds from disposals of equity
securities............................ 30.9 53.3 2.4
Proceeds from disposals of other
investments........................... 0.8 22.7 23.7
Proceeds from mortgages matured or
collected............................. 30.5 60.1 62.9
Purchase of available-for-sale fixed
maturities............................ (415.5) (136.0) (579.7)
Purchase of equity securities........... (20.2) (30.6) (3.2)
Purchase of other investments........... (44.1) (22.7) (9.0)
Purchase of mortgages................... -- (58.9) (70.4)
Other investing activities, net......... 2.0 (3.9) --
------- ------- -------
Net cash (used in) provided by
investing activities.............. (84.7) 71.0 336.4
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Contribution from subsidiaries.......... 14.6 -- --
Proceeds from issuance of stock and
capital paid in....................... 4.0 21.0 19.2
------- ------- -------
Net cash provided by financing
activities........................ 18.6 21.0 19.2
------- ------- -------
Net change in cash and cash equivalents..... (85.0) 186.8 12.3
Cash and cash equivalents, beginning of
period..................................... 217.9 31.1 18.8
------- ------- -------
Cash and cash equivalents, end of period.... $ 132.9 $ 217.9 $ 31.1
======= ======= =======
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid........................... $ -- $ -- $ --
Income taxes paid....................... $ 4.4 $ 36.2 $ 5.4
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

F-5
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION

Allmerica Financial Life Insurance and Annuity Company ("AFLIAC" or the
"Company") is organized as a stock life insurance company, and is a wholly-owned
subsidiary of First Allmerica Financial Life Insurance Company ("FAFLIC") which
is a wholly-owned subsidiary of Allmerica Financial Corporation ("AFC"). As
noted below, the consolidated accounts of AFLIAC include the accounts of certain
wholly-owned non-insurance subsidiaries (principally brokerage and investment
advisory subsidiaries).

Prior to July 1, 1999, AFLIAC was a wholly-owned subsidiary of SMA Financial
Corporation ("SMAFCO"), which was a wholly-owned subsidiary of FAFLIC. Effective
July 1, 1999 and in connection with AFC's restructuring activities, SMAFCO was
renamed Allmerica Asset Management , Inc. ("AAM") and contributed it's ownership
of AFLIAC to FAFLIC. AAM also contributed Allmerica Investments, Inc., Allmerica
Investment Management Company, Inc., Allmerica Financial Investment Management
Services, Inc., and Allmerica Financial Services Insurance Agency, Inc., to
AFLIAC in exchange for one share of AFLIAC common stock. The equity of these
four companies on July 1, 1999 was $11.8 million. For the six months ended
December 31, 1999, the subsidiaries of AFLIAC had total revenue of $35.5 million
and total benefits, losses and expenses of $24.4 million. All significant
intercompany accounts and transactions have been eliminated.

In addition, effective November 1, 1999, the Company's consolidated financial
statements include five wholly-owned insurance agencies. These agencies are
Allmerica Investments Insurance Agency Inc. of Alabama, Allmerica Investments
Insurance Agency of Florida Inc., Allmerica Investment Insurance Agency Inc. of
Georgia, Allmerica Investment Insurance Agency Inc. of Kentucky, and Allmerica
Investments Insurance Agency Inc. of Mississippi.

The consolidated financial statements of AFLIAC include the accounts of Somerset
Square, Inc., a wholly-owned non-insurance company, which was transferred from
SMAFCO effective November 30, 1997 and dissolved as a subsidiary effective
November 30, 1998. Its results of operations are included for eleven months of
1998 and for the month of December, 1997.

The statutory stockholder's equity of the Company is being maintained at a
minimum level of 5% of general account assets by FAFLIC in accordance with a
policy established by vote of FAFLIC's Board of Directors.

The preparation of financial statements in conformity with generally accepted
accounting principles requires the Company to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

B. VALUATION OF INVESTMENTS

In accordance with the provisions of Statement of Financial Accounting Standards
No. 115 ("Statement No. 115"), "Accounting for Certain Investments in Debt and
Equity Securities," the Company is required to classify its investments into one
of three categories: held-to-maturity, available-for-sale or trading. The
Company determines the appropriate classification of debt securities at the time
of purchase and re-evaluates such designation as of each balance sheet date.

F-6
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Debt securities and marketable equity securities are classified as
available-for-sale. Available-for-sale securities are carried at fair value,
with the unrealized gains and losses, net of tax, reported in a separate
component of shareholder's equity. The amortized cost of debt securities is
adjusted for amortization of premiums and accretion of discounts to maturity.
Such amortization is included in investment income.

Mortgage loans on real estate are stated at unpaid principal balances, net of
unamortized discounts and reserves. Reserves on mortgage loans are based on
losses expected by the Company to be realized on transfers of mortgage loans to
real estate (upon foreclosure), on the disposition or settlement of mortgage
loans and on mortgage loans which the Company believes may not be collectible in
full. In establishing reserves, the Company considers, among other things, the
estimated fair value of the underlying collateral.

Fixed maturities and mortgage loans that are delinquent are placed on
non-accrual status, and thereafter interest income is recognized only when cash
payments are received.

Policy loans are carried principally at unpaid principal balances.

During 1997, the Company adopted a plan to dispose of all real estate assets. As
of December 31, 1999, there was one property remaining in the Company's real
estate portfolio, which is being actively marketed. This asset is carried at the
estimated fair value less costs of disposal. Depreciation is not recorded on
this asset while it is held for disposal.

Realized investment gains and losses, other than those related to separate
accounts for which the Company does not bear the investment risk, are reported
as a component of revenues based upon specific identification of the investment
assets sold. When an other than temporary impairment of the value of a specific
investment or a group of investments is determined, a realized investment loss
is recorded. Changes in the valuation allowance for mortgage loans are included
in realized investment gains or losses.

C. FINANCIAL INSTRUMENTS

In the normal course of business, the Company enters into transactions involving
various types of financial instruments, including debt, investments such as
fixed maturities, mortgage loans and equity securities and investment and loan
commitments. These instruments involve credit risk and also may be subject to
risk of loss due to interest rate fluctuation. The Company evaluates and
monitors each financial instrument individually and, when appropriate, obtains
collateral or other security to minimize losses.

D. CASH AND CASH EQUIVALENTS

Cash and cash equivalents includes cash on hand, amounts due from banks and
highly liquid debt instruments purchased with an original maturity of three
months or less.

E. DEFERRED POLICY ACQUISITION COSTS

Acquisition costs consist of commissions, underwriting costs and other costs,
which vary with, and are primarily related to, the production of revenues.
Acquisition costs related to universal life products, variable annuities and
contractholder deposit funds are deferred and amortized in proportion to total
estimated gross profits from investment yields, mortality, surrender charges and
expense margins over the expected life of the contracts. This amortization is
reviewed annually and adjusted retrospectively when the Company revises its
estimate of current or future gross profits to be realized from this group of
products, including realized and unrealized gains and losses from investments.
Acquisition costs related to fixed annuities and other life insurance products
are deferred and amortized, generally in proportion to the ratio of annual
revenue to the

F-7
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

estimated total revenues over the contract periods based upon the same
assumptions used in estimating the liability for future policy benefits.

Deferred acquisition costs for each product are reviewed to determine if they
are recoverable from future income, including investment income. If such costs
are determined to be unrecoverable, they are expensed at the time of
determination. Although realization of deferred policy acquisition costs is not
assured, the Company believes it is more likely than not that all of these costs
will be realized. The amount of deferred policy acquisition costs considered
realizable, however, could be reduced in the near term if the estimates of gross
profits or total revenues discussed above are reduced. The amount of
amortization of deferred policy acquisition costs could be revised in the near
term if any of the estimates discussed above are revised.

F. SEPARATE ACCOUNTS

Separate account assets and liabilities represent segregated funds administered
and invested by the Company for the benefit of variable annuity and variable
life insurance contractholders. Assets consist principally of bonds, common
stocks, mutual funds, and short-term obligations at market value. The investment
income, gains and losses of these accounts generally accrue to the
contractholders and, therefore, are not included in the Company's net income.
Appreciation and depreciation of the Company's interest in the separate
accounts, including undistributed net investment income, is reflected in
shareholder's equity or net investment income.

G. POLICY LIABILITIES AND ACCRUALS

Future policy benefits are liabilities for life, disability income and annuity
products. Such liabilities are established in amounts adequate to meet the
estimated future obligations of policies in force. The liabilities associated
with traditional life insurance products are computed using the net level
premium method for individual life and annuity policies, and are based upon
estimates as to future investment yield, mortality and withdrawals that include
provisions for adverse deviation. Future policy benefits for individual life
insurance and annuity policies are computed using interest rates ranging from
3.0% to 6.0% for life insurance and 3 1/2% to 9 1/2% for annuities. Mortality,
morbidity and withdrawal assumptions for all policies are based on the Company's
own experience and industry standards. Liabilities for universal life, variable
universal life and variable annuities include deposits received from customers
and investment earnings on their fund balances, less administrative charges.
Universal life fund balances are also assessed mortality and surrender charges.
Liabilities for variable annuities include a reserve for benefit claims in
excess of a guaranteed minimum fund value.

Individual disability income benefit liabilities for active lives are estimated
using the net level premium method, and assumptions as to future morbidity and
interest which provide a margin for adverse deviation. Benefit liabilities for
disabled lives are estimated using the present value of benefits method and
experience assumptions as to claim terminations, expenses and interest.

Liabilities for outstanding claims and losses are estimates of payments to be
made for reported claims and estimates of claims incurred but not reported for
individual life and disability income policies. These estimates are continually
reviewed and adjusted as necessary; such adjustments are reflected in current
operations.

Contractholder deposit funds and other policy liabilities include
investment-related products and consist of deposits received from customers and
investment earnings on their fund balances.

F-8
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

All policy liabilities and accruals are based on the various estimates discussed
above. Although the adequacy of these amounts cannot be assured, the Company
believes that it is more likely than not that policy liabilities and accruals
will be sufficient to meet future obligations of policies in force. The amount
of liabilities and accruals, however, could be revised in the near term if the
estimates discussed above are revised.

H. PREMIUM AND FEE REVENUE AND RELATED EXPENSES

Premiums for individual life insurance and individual and group annuity
products, excluding universal life and investment-related products, are
considered revenue when due. Individual disability income insurance premiums are
recognized as revenue over the related contract periods. The unexpired portion
of these premiums is recorded as unearned premiums. Benefits, losses and related
expenses are matched with premiums, resulting in their recognition over the
lives of the contracts. This matching is accomplished through the provision for
future benefits, estimated and unpaid losses and amortization of deferred policy
acquisition costs. Revenues for investment-related products consist of net
investment income and contract charges assessed against the fund values. Related
benefit expenses include annuity benefit claims in excess of a guaranteed
minimum fund value, and net investment income credited to the fund values after
deduction for investment and risk charges. Revenues for universal life and group
variable universal life products consist of net investment income, with
mortality, administration and surrender charges assessed against the fund
values. Related benefit expenses include universal life benefit claims in excess
of fund values and net investment income credited to universal life fund values.
Certain policy charges that represent compensation for services to be provided
in future periods are deferred and amortized over the period benefited using the
same assumptions used to amortize capitalized acquisition costs.

I. FEDERAL INCOME TAXES

AFC and its domestic subsidiaries (including certain non-insurance operations)
file a consolidated United States federal income tax return. Entities included
within the consolidated group are segregated into either a life insurance or
non-life insurance company subgroup. The consolidation of these subgroups is
subject to certain statutory restrictions on the percentage of eligible non-life
tax losses that can be applied to offset life insurance company taxable income.

The Board of Directors has delegated to AFC management, the development and
maintenance of appropriate federal income tax allocation policies and
procedures, which are subject to written agreement between the companies. The
Federal income tax for all subsidiaries in the consolidated return of AFC is
calculated on a separate return basis. Any current tax liability is paid to AFC.
Tax benefits resulting from taxable operating losses or credits of AFC's
subsidiaries are not reimbursed to the subsidiary until such losses or credits
can be utilized by the subsidiary on a separate return basis.

Deferred income taxes are generally recognized when assets and liabilities have
different values for financial statement and tax reporting purposes, and for
other temporary taxable and deductible differences as defined by Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes"
("Statement No. 109"). These differences result primarily from policy reserves,
policy acquisition expenses, and unrealized appreciation or depreciation on
investments.

J. OTHER INCOME AND OTHER OPERATING EXPENSES

Other income and other operating expenses for the year ended December 31, 1999
include investment management and brokerage income and sub-advisory expenses
arising from the activities of the non-insurance subsidiaries that were
transferred to AFLIAC during 1999, as more fully described in Note 1A.

F-9
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

K. NEW ACCOUNTING PRONOUNCEMENTS

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("Statement No. 133"), which establishes
accounting and reporting standards for derivative instruments. Statement No. 133
requires that an entity recognize all derivatives as either assets or
liabilities at fair value in the statement of financial position, and
establishes special accounting for the following three types of hedges; fair
value hedges, cash flow hedges, and hedges of foreign currency exposures of net
investments in foreign operations. This statement is effective for fiscal
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY (an indirect wholly-owned
subsidiary of Allmerica Financial Corporation) years beginning after June 15,
2000. The Company is currently assessing the impact of adoption of Statement No.
133.

In March 1998, the American Institute of Certified Public Accountants ("AICPA")
issued Statement of Position 98-1, "Accounting for the Cost of Computer Software
Developed or Obtained for Internal Use" ("SoP 98-1"). SoP 98-1 requires that
certain costs incurred in developing internal-use computer software be
capitalized and provides guidance for determining whether computer software is
to be considered for internal use. This statement is effective for fiscal years
beginning after December 15, 1998. In the second quarter of 1998, the Company
adopted SoP 98-1 effective January 1, 1998, resulting in an increase in pre-tax
income of $9.8 million through December 31, 1998. The adoption of SOP 98-1 did
not have a material effect on the results of operations or financial position
for the three months ended March 31, 1998.

In December 1997, the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position 97-3, "Accounting by Insurance and Other
Enterprises for Insurance-Related Assessments" ("SoP 97-3"). SoP 97-3 provides
guidance when a liability should be recognized for guaranty fund and other
assessments and how to measure the liability. This statement allows for the
discounting of the liability if the amount and timing of the cash payments are
fixed and determinable. In addition, it provides criteria for when an asset may
be recognized for a portion or all of the assessment liability or paid
assessment that can be recovered through premium tax offsets or policy
surcharges. This statement is effective for fiscal years beginning after
December 15, 1998. The adoption of this statement had no effect on the results
of operations or financial position of the Company.

In June 1997, the FASB issued Statement No. 131, "Disclosures About Segments of
an Enterprise and Related Information" ("Statement No. 131"). This statement
establishes standards for the way that public enterprises report information
about operating segments in annual financial statements and requires that
selected information about those operating segments be reported in interim
financial statements. This statement supersedes Statement No. 14, "Financial
Reporting for Segments of a Business Enterprise". Statement No. 131 requires
that all public enterprises report financial and descriptive information about
their reportable operating segments. Operating segments are defined as
components of an enterprise about which separate financial information is
available that is evaluated regularly by the chief operating decision maker in
deciding how to allocate resources and in assessing performance. This statement
is effective for fiscal years beginning after December 15, 1997. AFLIAC consists
of one segment, Allmerica Financial Services, which underwrites and distributes
variable annuities and variable universal life insurance via retail channels.

In June 1997, the FASB also issued Statement No. 130, "Reporting Comprehensive
Income" ("Statement No. 130"). Statement No. 130 establishes standards for the
reporting and display of comprehensive income and its components in a full set
of general-purpose financial statements. All items that are required to be
recognized under accounting standards as components of comprehensive income are
to be reported in a financial statement that is displayed with the same
prominence as other financial statements. This statement stipulates that
comprehensive income reflect the change in equity of an enterprise during a
period from transactions and

F-10
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

other events and circumstances from non-owner sources. This statement is
effective for fiscal years beginning after December 15, 1997. The Company
adopted Statement No. 130 for the first quarter of 1998, which resulted
primarily in reporting unrealized gains and losses on investments in debt and
equity securities in comprehensive income.

L. RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform to the current year
presentation.

2. SIGNIFICANT TRANSACTIONS

During 1999, AFLIAC's parent contributed $11.8 million of additional paid-in
capital to the Company in the form of four subsidiaries as disclosed in Note 1A
above. These subsidiaries consisted of assets of $22.0 million, of which $14.6
million was cash and cash equivalents, and liabilities of $10.2 million. During
1999, 1998 and 1997, SMAFCO contributed $4.0 million, $21.0 million, and $40.6
million respectively, of additional paid-in capital to the Company. The nature
of the 1997 contribution was $19.2 million in cash and $21.4 million in other
assets including Somerset Square, Inc.

Effective January 1, 1998, the Company entered into an agreement with a highly
rated reinsurer to reinsure the mortality risk on the universal life and
variable universal life blocks of business. The agreement did not have a
material effect on the results of operations or financial position of the
Company.

On April 14, 1997, the Company entered into an agreement in principle to cede
substantially all of the Company's individual disability income line of business
under a 100% coinsurance agreement with a highly rated reinsurer. The
coinsurance agreement became effective October 1, 1997. The transaction has
resulted in the recognition of a $53.9 million pre-tax loss in the first quarter
of 1997.

3. INVESTMENTS

A. SUMMARY OF INVESTMENTS

The Company accounts for its investments, all of which are classified as
available-for-sale, in accordance with the provisions of Statement No. 115.

The amortized cost and fair value of available-for-sale fixed maturities and
equity securities were as follows:

<TABLE>
<CAPTION>
1999
-------------------------------------------
GROSS GROSS
DECEMBER 31, AMORTIZED UNREALIZED UNREALIZED FAIR
(IN MILLIONS) COST (1) GAINS LOSSES VALUE
- ------------- --------- ---------- ---------- --------
<S> <C> <C> <C> <C>
U.S. Treasury securities and U.S.
government and agency securities....... $ 5.2 $ 0.2 $-- $ 5.4
States and political subdivisions....... 12.4 0.1 -- 12.5
Foreign governments..................... 38.6 0.9 0.6 38.9
Corporate fixed maturities.............. 1,180.0 10.3 38.9 1,151.4
Mortgage-backed securities.............. 118.0 1.1 2.7 116.4
-------- ----- ----- --------
Total fixed maturities.................. $1,354.2 $12.6 $42.2 $1,324.6
======== ===== ===== ========
Equity securities....................... $ 25.2 $ 7.4 $-- $ 32.6
======== ===== ===== ========
</TABLE>

(1) Amortized cost for fixed maturities and cost for equity securities.

F-11
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
1998
-------------------------------------------
GROSS GROSS
DECEMBER 31, AMORTIZED UNREALIZED UNREALIZED FAIR
(IN MILLIONS) COST (1) GAINS LOSSES VALUE
- ------------- --------- ---------- ---------- --------
<S> <C> <C> <C> <C>
U.S. Treasury securities and U.S.
government and agency securities....... $ 5.8 $ 0.8 $-- $ 6.6
States and political subdivisions....... 2.7 0.2 -- 2.9
Foreign governments..................... 48.8 1.6 1.5 48.9
Corporate fixed maturities.............. 1,096.0 58.0 17.7 1,136.3
Mortgage-backed securities.............. 131.3 5.8 1.4 135.7
-------- ----- ----- --------
Total fixed maturities.................. $1,284.6 $66.4 $20.6 $1,330.4
======== ===== ===== ========
Equity securities....................... $ 27.4 $ 8.9 $ 4.5 $ 31.8
======== ===== ===== ========
</TABLE>

(1) Amortized cost for fixed maturities and cost for equity securities.

In connection with AFLIAC's voluntary withdrawal of its license in New York,
AFLIAC agreed with the New York Department of Insurance to maintain, through a
custodial account in New York, a security deposit, the market value of which
will at all times equal 102% of all outstanding liabilities of AFLIAC for New
York policyholders, claimants and creditors. At December 31, 1999, the amortized
cost and market value of these assets on deposit in New York were
$196.4 million and $193.0 million, respectively. At December 31, 1998, the
amortized cost and market value of assets on deposit were $268.5 million and
$284.1 million, respectively. In addition, fixed maturities, excluding those
securities on deposit in New York, with an amortized cost of $4.1 million and
$4.2 million were on deposit with various state and governmental authorities at
December 31, 1999 and 1998, respectively.

There were no contractual fixed maturity investment commitments at December 31,
1999.

The amortized cost and fair value by maturity periods for fixed maturities are
shown below. Actual maturities may differ from contractual maturities because
borrowers may have the right to call or prepay obligations with or without call
or prepayment penalties, or the Company may have the right to put or sell the
obligations back to the issuers. Mortgage backed securities are included in the
category representing their ultimate maturity.

<TABLE>
<CAPTION>
1999
-------------------
DECEMBER 31, AMORTIZED FAIR
(IN MILLIONS) COST VALUE
- ------------- --------- --------
<S> <C> <C>
Due in one year or less..................................... $ 54.5 $ 54.8
Due after one year through five years....................... 349.1 347.2
Due after five years through ten years...................... 652.9 637.1
Due after ten years......................................... 297.7 285.5
-------- --------
Total....................................................... $1,354.2 $1,324.6
======== ========
</TABLE>

F-12
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Unrealized gains and losses on available-for-sale and other securities, are
summarized as follows:

<TABLE>
<CAPTION>
EQUITY
FOR THE YEARS ENDED DECEMBER 31, FIXED SECURITIES
(IN MILLIONS) MATURITIES AND OTHER (1) TOTAL
- ------------- ---------- ------------- ------
<S> <C> <C> <C>
1999
Net appreciation, beginning of year......................... $ 16.2 $ 7.9 $ 24.1
------ ------ ------
Net depreciation on available-for-sale securities........... (75.3) (0.2) (75.5)
Net appreciation from the effect on deferred policy
acquisition costs and on policy liabilities................ 34.4 -- 34.4
Benefit from deferred federal income taxes.................. 14.3 0.1 14.4
------ ------ ------
(26.6) (0.1) (26.7)
------ ------ ------
Net (depreciation) appreciation, end of year................ $(10.4) $ 7.8 $ (2.6)
====== ====== ======

1998
Net appreciation, beginning of year......................... $ 22.1 $ 16.4 $ 38.5
------ ------ ------
Net depreciation on available-for-sale securities........... (16.2) (14.3) (30.5)
Net appreciation from the effect on deferred policy
acquisition costs and on policy liabilities................ 7.1 -- 7.1
Benefit from deferred federal income taxes.................. 3.2 5.8 9.0
------ ------ ------
(5.9) (8.5) (14.4)
------ ------ ------
Net appreciation, end of year............................... $ 16.2 $ 7.9 $ 24.1
====== ====== ======

1997
Net appreciation, beginning of year......................... $ 12.7 $ 7.8 $ 20.5
------ ------ ------
Net appreciation on available-for-sale securities........... 24.3 12.5 36.8
Net depreciation from the effect on deferred policy
acquisition costs and on policy liabilities................ (9.8) -- (9.8)
Provision for deferred federal income taxes................. (5.1) (3.9) (9.0)
------ ------ ------
9.4 8.6 18.0
------ ------ ------
Net appreciation, end of year............................... $ 22.1 $ 16.4 $ 38.5
====== ====== ======
</TABLE>

(1) Includes net (depreciation) appreciation on other investments of $(3.1)
million, $0.9 million, and $1.3 million in 1999, 1998, and 1997,
respectively.

B. MORTGAGE LOANS AND REAL ESTATE

AFLIAC's mortgage loans are diversified by property type and location. The real
estate investment was obtained by an affiliate through foreclosure. Mortgage
loans are collateralized by the related properties and generally are no more
than 75% of the property's value at the time the original loan is made.

The carrying values of mortgage loans and the real estate investment net of
applicable reserves were $234.6 million and $244.5 million at December 31, 1999
and 1998, respectively. Reserves for mortgage loans were $2.4 million and
$3.3 million at December 31, 1999 and 1998, respectively.

F-13
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

During 1997, the Company committed to a plan to dispose of all real estate
assets. At December 31, 1999, there was one property remaining in the Company's
real estate portfolio which is being actively marketed. Depreciation is not
recorded on this asset while it is held for disposal.

There were no non-cash investing activities, including real estate acquired
through foreclosure of mortgage loans, in 1999, 1998 and 1997.

There were no material contractual commitments to extend credit under commercial
mortgage loan agreements at December 31, 1999.

Mortgage loans and real estate investments comprised the following property
types and geographic regions:

<TABLE>
<CAPTION>
DECEMBER 31,
(IN MILLIONS) 1999 1998
- ------------- ------ ------
<S> <C> <C>
Property type:
Office building........................................... $136.1 $129.2
Residential............................................... 18.5 18.9
Retail.................................................... 28.3 37.4
Industrial/warehouse...................................... 51.1 59.2
Other..................................................... 3.0 3.1
Valuation allowances...................................... (2.4) (3.3)
------ ------
Total....................................................... $234.6 $244.5
====== ======
Geographic region:
South Atlantic............................................ $ 60.7 $ 55.5
Pacific................................................... 76.2 80.0
East North Central........................................ 35.9 41.4
Middle Atlantic........................................... 20.1 22.5
New England............................................... 29.9 26.9
West South Central........................................ 1.9 6.7
Other..................................................... 12.3 14.8
Valuation allowances...................................... (2.4) (3.3)
------ ------
Total....................................................... $234.6 $244.5
====== ======
</TABLE>

At December 31, 1999, scheduled mortgage loan maturities were as follows:
2000 -- $40.8 million; 2001 -- $6.3 million; 2002 -- $11.2 million; 2003 --
$0.5 million; 2004 -- $23.7 million; and $141.2 million thereafter. Actual
maturities could differ from contractual maturities because borrowers may have
the right to prepay obligations with or without prepayment penalties and loans
may be refinanced. During 1999, the Company did not refinance any mortgage loans
based on terms which differed from those granted to new borrowers.

F-14
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

C. INVESTMENT VALUATION ALLOWANCES

Investment valuation allowances which have been deducted in arriving at
investment carrying values as presented in the consolidated balance sheets and
changes thereto are shown below.

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31, BALANCE AT BALANCE AT
(IN MILLIONS) JANUARY 1 PROVISIONS WRITE-OFFS DECEMBER 31
- ------------- ---------- ---------- ---------- ------------
<S> <C> <C> <C> <C>
1999
Mortgage loans.............................................. $ 3.3 $(0.8) $0.1 $2.4
===== ===== ==== ====
1998
Mortgage loans.............................................. $ 9.4 $(4.5) $1.6 $3.3
===== ===== ==== ====
1997
Mortgage loans.............................................. $ 9.5 $ 1.1 $1.2 $9.4
Real estate................................................. 1.7 3.7 5.4 --
----- ----- ---- ----
Total................................................... $11.2 $ 4.8 $6.6 $9.4
===== ===== ==== ====
</TABLE>

Provisions on mortgages during 1999 and 1998 reflect the release of redundant
specific reserves. Write-offs of $5.4 million to the investment valuation
allowance related to real estate in 1997 primarily reflect write downs to the
estimated fair value less costs to sell pursuant to the aforementioned 1997 plan
of disposal.

The carrying value of impaired loans was $11.4 million and $15.3 million, with
related reserves of $0.7 million and $1.5 million as of December 31, 1999 and
1998, respectively. All impaired loans were reserved for as of December 31, 1999
and 1998.

The average carrying value of impaired loans was $14.3 million, $17.0 million
and $19.8 million, with related interest income while such loans were impaired
of $1.5 million, $2.0 million and $2.2 million as of December 31, 1999, 1998 and
1997, respectively.

D. OTHER

At December 31, 1999 and 1998, AFLIAC had no concentration of investments in a
single investee exceeding 10% of shareholder's equity.

4. INVESTMENT INCOME AND GAINS AND LOSSES

A. NET INVESTMENT INCOME

The components of net investment income were as follows:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- ------ ------ ------
<S> <C> <C> <C>
Fixed maturities............................................ $107.2 $107.7 $130.0
Mortgage loans.............................................. 19.0 25.5 20.4
Equity securities........................................... 0.4 0.3 1.3
Policy loans................................................ 12.4 11.7 10.8
Real estate and other long-term investments................. 4.0 4.8 4.9
Short-term investments...................................... 9.5 4.2 1.4
------ ------ ------
Gross investment income................................. 152.5 154.2 168.8
Less investment expenses.................................... (2.3) (2.9) (4.6)
------ ------ ------
Net investment income................................... $150.2 $151.3 $164.2
====== ====== ======
</TABLE>

F-15
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

At December 31, 1999, the Company had fixed maturities with a carrying value of
$0.8 million on non-accrual status. There were no mortgage loans on non-accrual
status at December 31, 1999. There were no mortgage loans or fixed maturities on
non-accrual status at December 31, 1998. The effect of non-accruals, compared
with amounts that would have been recognized in accordance with the original
terms of the investments, was a reduction in net income of $1.2 million in 1999,
and had no impact in 1998 and 1997.

The payment terms of mortgage loans may from time to time be restructured or
modified. The investment in restructured mortgage loans, based on amortized
cost, amounted to $12.2 million, $12.6 million and $21.1 million at December 31,
1999, 1998 and 1997, respectively. Interest income on restructured mortgage
loans that would have been recorded in accordance with the original terms of
such loans amounted to $0.9 million, $1.4 million and $1.9 million in 1999,
1998, and 1997, respectively. Actual interest income on these loans included in
net investment income aggregated $1.1 million, $1.8 million and $2.1 million in
1999, 1998 and 1997, respectively.

There were no fixed maturities or mortgage loans which were non-income producing
for the year ended December 31, 1999.

Included in other long-term investments is income from limited partnerships of
$0.9 million and $0.7 million in 1999 and 1998, respectively. There was no
income from limited partnerships included in other long-term investments in
1997.

B. NET REALIZED INVESTMENT GAINS AND LOSSES

Realized (losses) gains on investments were as follows:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- ------ ----- -----
<S> <C> <C> <C>
Fixed maturities............................................ $(18.8) $(6.1) $ 3.0
Mortgage loans.............................................. 0.8 8.0 (1.1)
Equity securities........................................... 8.5 15.7 0.5
Real estate and other....................................... 0.8 2.4 0.5
------ ----- -----
Net realized investment (losses) gains...................... $ (8.7) $20.0 $ 2.9
====== ===== =====
</TABLE>

The proceeds from voluntary sales of available-for-sale securities and the gross
realized gains and gross realized losses on those sales were as follows:

<TABLE>
<CAPTION>
PROCEEDS FROM
FOR THE YEARS ENDED DECEMBER 31, VOLUNTARY GROSS GROSS
(IN MILLIONS) SALES GAINS LOSSES
- ------------- ------------- ----- ------
<S> <C> <C> <C>
1999
Fixed maturities............................................ $162.3 $ 2.7 $4.3
Equity securities........................................... $ 30.4 $10.1 $1.6
1998
Fixed maturities............................................ $ 60.0 $ 2.0 $2.0
Equity securities........................................... $ 52.6 $17.5 $0.9
1997
Fixed maturities............................................ $702.9 $11.4 $5.0
Equity securities........................................... $ 1.3 $ 0.5 $--
</TABLE>

F-16
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

C. OTHER COMPREHENSIVE INCOME RECONCILIATION

The following table provides a reconciliation of gross unrealized (losses) gains
to the net balance shown in the consolidated statements of comprehensive income:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- ------ ------ -----
<S> <C> <C> <C>
Unrealized (losses) gains on securities:
Unrealized holding (losses) gains arising during period (net
of taxes of $(18.0) million, $(5.6) million and
$10.2 million in 1999, 1998 and 1997, respectively)........ $(33.4) $ (8.2) $20.3
Less: reclassification adjustment for (losses) gains
included in net income (net of taxes of $(3.6) million,
$3.4 million and $1.2 million in 1999, 1998 and 1997,
respectively).............................................. (6.7) 6.2 2.3
------ ------ -----
Other comprehensive (loss) income........................... $(26.7) $(14.4) $18.0
====== ====== =====
</TABLE>

5. FAIR VALUE DISCLOSURES OF FINANCIAL INSTRUMENTS

Statement No. 107, "Disclosures about Fair Value of Financial Instruments,"
requires disclosure of fair value information about certain financial
instruments (insurance contracts, real estate, goodwill and taxes are excluded)
for which it is practicable to estimate such values, whether or not these
instruments are included in the balance sheet. The fair values presented for
certain financial instruments are estimates which, in many cases, may differ
significantly from the amounts which could be realized upon immediate
liquidation. In cases where market prices are not available, estimates of fair
value are based on discounted cash flow analyses which utilize current interest
rates for similar financial instruments which have comparable terms and credit
quality.

The following methods and assumptions were used to estimate the fair value of
each class of financial instruments:

CASH AND CASH EQUIVALENTS

For these short-term investments, the carrying amount approximates fair value.

FIXED MATURITIES

Fair values are based on quoted market prices, if available. If a quoted market
price is not available, fair values are estimated using independent pricing
sources or internally developed pricing models using discounted cash flow
analyses.

EQUITY SECURITIES

F-17
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

MORTGAGE LOANS

Fair values are estimated by discounting the future contractual cash flows using
the current rates at which similar loans would be made to borrowers with similar
credit ratings. The fair value of below investment grade mortgage loans are
limited to the lesser of the present value of the cash flows or book value.

POLICY LOANS

The carrying amount reported in the balance sheet approximates fair value since
policy loans have no defined maturity dates and are inseparable from the
insurance contracts.

FIXED ANNUITY AND OTHER CONTRACTS (WITHOUT MORTALITY FEATURES)

Fair values for the Company's liabilities under individual fixed annuity
contracts are estimated based on current surrender values, supplemental
contracts without life contingencies reflect current fund balances, and other
individual contract funds represent the present value of future policy benefits.

The estimated fair values of the financial instruments were as follows:

<TABLE>
<CAPTION>
1999 1998
------------------ ------------------
DECEMBER 31, CARRYING FAIR CARRYING FAIR
(IN MILLIONS) VALUE VALUE VALUE VALUE
- ------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
FINANCIAL ASSETS
Cash and cash equivalents................................. $ 132.9 $ 132.9 $ 217.9 $ 217.9
Fixed maturities.......................................... 1,324.6 1,324.6 1,330.4 1,330.4
Equity securities......................................... 32.6 32.6 31.8 31.8
Mortgage loans............................................ 223.7 222.8 230.0 241.9
Policy loans.............................................. 166.8 166.8 151.5 151.5
-------- -------- -------- --------
$1,880.6 $1,879.7 $1,961.6 $1,973.5
======== ======== ======== ========
FINANCIAL LIABILITIES
Individual fixed annuity contracts........................ $1,048.0 $1,014.9 $1,069.4 $1,034.6
Supplemental contracts without life contingencies......... 25.0 25.0 21.0 21.0
Other individual contract deposit funds................... 19.3 19.3 17.0 17.0
-------- -------- -------- --------
$1,092.3 $1,059.2 $1,107.4 $1,072.6
======== ======== ======== ========
</TABLE>

F-18
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. FEDERAL INCOME TAXES

Provisions for federal income taxes have been calculated in accordance with the
provisions of Statement No. 109. A summary of the federal income tax expense in
the consolidated statement of income is shown below:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- ----- ----- -----
<S> <C> <C> <C>
Federal income tax expense
Current................................................... $15.5 $22.1 $13.9
Deferred.................................................. 30.5 11.8 7.1
----- ----- -----
Total....................................................... $46.0 $33.9 $21.0
===== ===== =====
</TABLE>

The provision for federal income taxes does not materially differ from the
amount of federal income tax determined by applying the appropriate U.S.
statutory income tax rate to income before federal income taxes.

The deferred income tax (asset) liability represents the tax effects of
temporary differences:

<TABLE>
<CAPTION>
DECEMBER 31,
(IN MILLIONS) 1999 1998
- ------------- ------- -------
<S> <C> <C>
Deferred tax (assets) liabilities
Policy reserves........................................... $(233.7) $(205.1)
Deferred acquisition costs................................ 339.7 278.8
Investments, net.......................................... (4.0) 12.5
Litigation reserves....................................... (4.3) (7.4)
Bad debt reserve.......................................... -- (0.4)
Other, net................................................ (2.9) 0.4
------- -------
Deferred tax liability, net................................. $ 94.8 $ 78.8
======= =======
</TABLE>

Gross deferred income tax liabilities totaled $360.4 million and $291.7 million
at December 31, 1999 and 1998, respectively. Gross deferred income tax assets
totaled $265.6 million and $212.9 million at December 31, 1999 and 1998,
respectively.

The Company believes, based on its recent earnings history and its future
expectations, that the Company's taxable income in future years will be
sufficient to realize all deferred tax assets. In determining the adequacy of
future income, the Company considered the future reversal of its existing
temporary differences and available tax planning strategies that could be
implemented, if necessary.

The Company's federal income tax returns are routinely audited by the Internal
Revenue Service ("IRS"), and provisions are routinely made in the financial
statements in anticipation of the results of these audits. The IRS has examined
the FAFLIC/AFLIAC consolidated group's federal income tax returns through 1994.
The Company has appealed certain adjustments proposed by the IRS with respect
federal income tax returns for 1992, 1993, and 1994 for the FAFLIC/AFLIAC
consolidated group. Also, certain adjustments proposed by the IRS with respect
to FAFLIC/AFLIAC's federal income tax returns for 1982 and 1983 remain
unresolved. If upheld, these adjustments would result in additional payments;
however, the Company will vigorously defend its position with respect to these
adjustments. In the Company's opinion, adequate tax liabilities have

F-19
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

been established for all years. However, the amount of these tax liabilities
could be revised in the near term if estimates of the Company's ultimate
liability are revised.

7. RELATED PARTY TRANSACTIONS

The Company has no employees of its own, but has agreements under which FAFLIC
provides management, space and other services, including accounting, electronic
data processing, human resources, legal and other staff functions. Charges for
these services are based on full cost including all direct and indirect overhead
costs, and amounted to $173.9 million, $145.4 million and $124.1 million in
1999, 1998 and 1997 respectively. The net amounts payable to FAFLIC and
affiliates for accrued expenses and various other liabilities and receivables
were $48.6 million and $16.4 million at December 31, 1999 and 1998,
respectively.

8. DIVIDEND RESTRICTIONS

Delaware has enacted laws governing the payment of dividends to stockholders by
insurers. These laws affect the dividend paying ability of the Company.

Pursuant to Delaware's statute, the maximum amount of dividends and other
distributions that an insurer may pay in any twelve month period, without the
prior approval of the Delaware Commissioner of Insurance, is limited to the
greater of (i) 10% of its policyholders' surplus as of the preceding December 31
or (ii) the individual company's statutory net gain from operations for the
preceding calendar year (if such insurer is a life company) or its net income
(not including realized capital gains) for the preceding calendar year (if such
insurer is not a life company). Any dividends to be paid by an insurer, whether
or not in excess of the aforementioned threshold, from a source other than
statutory earned surplus would also require the prior approval of the Delaware
Commissioner of Insurance.

No dividends were declared by the Company during 1999, 1998 or 1997. During
2000, AFLIAC could pay dividends of $34.3 million to FAFLIC without prior
approval.

9. REINSURANCE

In the normal course of business, the Company seeks to reduce the loss that may
arise from events that cause unfavorable underwriting results by reinsuring
certain levels of risk in various areas of exposure with other insurance
enterprises or reinsurers. Reinsurance transactions are accounted for in
accordance with the provisions of Statement No. 113, "Accounting and Reporting
for Reinsurance of Short-Duration and Long-Duration Contracts" ("Statement
No. 113").

The Company reinsures 100% of its traditional individual life and certain blocks
of its universal life business, substantially all of its disability income
business, and effective January 1, 1998, the mortality risk on the variable
universal life and remaining universal life blocks of business in-force at
December 31, 1997.

Amounts recoverable from reinsurers are estimated in a manner consistent with
the claim liability associated with the reinsured policy. Reinsurance contracts
do not relieve the Company from its obligations to policyholders. Failure of
reinsurers to honor their obligations could result in losses to the Company;
consequently, allowances are established for amounts deemed uncollectible. The
Company determines the appropriate amount of reinsurance based on evaluation of
the risks accepted and analyses prepared by consultants and reinsurers and on
market conditions (including the availability and pricing of reinsurance). The
Company also believes that the terms of its reinsurance contracts are consistent
with industry practice in that they contain

F-20
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

standard terms with respect to lines of business covered, limit and retention,
arbitration and occurrence. Based on its review of its reinsurers' financial
statements and reputations in the reinsurance marketplace, the Company believes
that its reinsurers are financially sound.

Amounts recoverable from reinsurers at December 31, 1999 and 1998 for the
disability income business were $241.5 million and $230.8 million, respectively,
traditional life were $9.7 million and $11.4 million, respectively, and
universal and variable universal life were $36.0 million and $65.8 million,
respectively.

The effects of reinsurance were as follows:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- ------ ------ ------
<S> <C> <C> <C>
Insurance premiums:
Direct.................................................... $ 41.3 $ 45.5 $ 48.8
Assumed................................................... -- -- 2.6
Ceded..................................................... (40.8) (45.0) (28.6)
------ ------ ------
Net premiums................................................ $ 0.5 $ 0.5 $ 22.8
====== ====== ======
Insurance and other individual policy benefits, claims and
losses:
Direct.................................................... $210.6 $204.0 $226.0
Assumed................................................... -- -- 4.2
Ceded..................................................... (37.0) (50.1) (42.4)
------ ------ ------
Net policy benefits, claims and losses...................... $173.6 $153.9 $187.8
====== ====== ======
</TABLE>

10. DEFERRED POLICY ACQUISITION COSTS

The following reflects the changes to the deferred policy acquisition cost
asset:

<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
(IN MILLIONS) 1999 1998 1997
- ------------- -------- ------ ------
<S> <C> <C> <C>
Balance at beginning of year................................ $ 950.5 $765.3 $632.7
Acquisition expenses deferred............................. 219.5 242.4 184.2
Amortized to expense during the year...................... (49.8) (64.6) (53.1)
Adjustment to equity during the year...................... 36.2 7.4 (10.2)
Adjustment for cession of disability income insurance..... -- -- (38.6)
Adjustment for revision of universal life and variable
universal life insurance mortality assumptions.......... -- -- 50.3
-------- ------ ------
Balance at end of year...................................... $1,156.4 $950.5 $765.3
======== ====== ======
</TABLE>

On October 1, 1997, the Company revised the mortality assumptions for universal
life and variable universal life product lines. These revisions resulted in a
$50.3 million recapitalization of deferred policy acquisition costs.

11. LIABILITIES FOR INDIVIDUAL DISABILITY INCOME BENEFITS

The Company regularly updates its estimates of liabilities for future policy
benefits and outstanding claims and losses as new information becomes available
and further events occur which may impact the resolution of

F-21
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

unsettled claims. Changes in prior estimates are recorded in results of
operations in the year such changes are determined to be needed.

The liability for future policy benefits and outstanding claims and losses
related to the Company's disability income business was $240.7 million and
$233.3 million at December 31, 1999 and 1998. Due to the reinsurance agreement
whereby the Company has ceded substantially all of its disability income
business to a highly rated reinsurer, the Company believes that no material
adverse development of losses will occur. However, the amount of the liabilities
could be revised in the near term if the estimates used in determining the
liability are revised.

12. CONTINGENCIES

REGULATORY AND INDUSTRY DEVELOPMENTS

Unfavorable economic conditions may contribute to an increase in the number of
insurance companies that are under regulatory supervision. This may result in an
increase in mandatory assessments by state guaranty funds, or voluntary payments
by solvent insurance companies to cover losses to policyholders of insolvent or
rehabilitated companies. Mandatory assessments, which are subject to statutory
limits, can be partially recovered through a reduction in future premium taxes
in some states. The Company is not able to reasonably estimate the potential
effect on it of any such future assessments or voluntary payments.

LITIGATION

In July 1997, a lawsuit on behalf of a putative class was instituted in
Louisiana against AFC and certain of its subsidiaries including AFLIAC, by
individual plaintiffs alleging fraud, unfair or deceptive acts, breach of
contract, misrepresentation, and related claims in the sale of life insurance
policies. In October 1997, plaintiffs voluntarily dismissed the Louisiana suit
and filed a substantially similar action in Federal District Court in Worcester,
Massachusetts. In early November 1998, AFC and the plaintiffs entered into a
settlement agreement. The court granted preliminary approval of the settlement
on December 4, 1998. On May 19, 1999, the Court issued an order certifying the
class for settlement purposes and granting final approval of the settlement
agreement. AFLIAC recognized a $21.0 million pre-tax expense during the third
quarter of 1998 related to this litigation. Although the Company believes that
this expense reflects appropriate recognition of its obligation under the
settlement, this estimate assumes the availability of insurance coverage for
certain claims, and the estimate may be revised based on the amount of
reimbursement actually tendered by AFC's insurance carriers, and based on
changes in the Company's estimate of the ultimate cost of the benefits to be
provided to members of the class.

The Company has been named a defendant in various legal proceedings arising in
the normal course of business. In the Company's opinion, based on the advice of
legal counsel, the ultimate resolution of these proceedings will not have a
material effect on the Company's consolidated financial statements. However,
liabilities related to these proceedings could be established in the near term
if estimates of the ultimate resolution of these proceedings are revised.

YEAR 2000

The Year 2000 issue resulted from computer programs being written using two
digits rather than four to define the applicable year. Computer programs that
have date-sensitive software may recognize a date using "00" as the year 1900
rather than the year 2000. This could result in a system failure or
miscalculations causing disruptions of operations, including, among other
things, a temporary inability to process transactions, send invoices or engage
in similar normal business activities.

F-22
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY

(AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF ALLMERICA FINANCIAL CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Although the Company does not believe that there is a material contingency
associated with the Year 2000 issue, there can be no assurance that exposure for
material contingencies will not arise.

13. STATUTORY FINANCIAL INFORMATION

The Company is required to file annual statements with state regulatory
authorities prepared on an accounting basis prescribed or permitted by such
authorities (statutory basis). Statutory surplus differs from shareholder's
equity reported in accordance with generally accepted accounting principles
primarily because policy acquisition costs are expensed when incurred,
investment reserves are based on different assumptions, life insurance reserves
are based on different assumptions and income tax expense reflects only taxes
paid or currently payable. In 1999, 49 out of 50 states have adopted the
National Association of Insurance Commissioners proposed Codification, which
provides for uniform statutory accounting principles. These principles are
effective January 1, 2001. The Company is currently assessing the impact that
the adoption of Codification will have on its statutory results of operations
and financial position. Statutory net income and surplus are as follows:

<TABLE>
<CAPTION>
(IN MILLIONS) 1999 1998 1997
- ------------- ------ ------ ------
<S> <C> <C> <C>
Statutory net income........................................ $ 5.0 $ (8.2) $ 31.5
Statutory shareholder's surplus............................. $342.7 $312.2 $309.7
</TABLE>

F-23
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of Allmerica Financial Life Insurance and Annuity
Company and the Policyowners of the Inheiritage Account of Allmerica Financial
Life Insurance and Annuity Company

In our opinion, the accompanying statements of assets and liabilities, and the
related statements of operations and of changes in net assets present fairly, in
all material respects, the financial position of each of the Sub-Accounts
constituting the Inheiritage Account of Allmerica Financial Life Insurance and
Annuity Company at December 31, 1999, the results of each of their operations
and the changes in each of their net assets for each of the periods indicated,
in conformity with accounting principles generally accepted in the United
States. These financial statements are the responsibility of Allmerica Financial
Life Insurance and Annuity Company; our responsibility is to express an opinion
on these financial statements based on our audits. We conducted our audits of
these financial statements in accordance with auditing standards generally
accepted in the United States, which require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at December 31, 1999 by
correspondence with the Funds, provide a reasonable basis for the opinion
expressed above.

/s/ PRICEWATERHOUSECOOPERS LLP

Boston, Massachusetts
April 3, 2000
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<CAPTION>

INVESTMENT MONEY GOVERNMENT
GROWTH GRADE INCOME MARKET EQUITY INDEX BOND
---------- ------------- ------------- ------------ -----------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments in shares of Allmerica Investment Trust..... $6,989,658 $2,011,519 $4,380,247 $6,944,029 $ 936,722
Investments in shares of Fidelity Variable Insurance
Products Funds (VIP).................................. -- -- -- -- --
Investment in shares of T. Rowe Price International
Series, Inc........................................... -- -- -- -- --
Investment in shares of Delaware Group Premium Fund..... -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Total assets.......................................... 6,989,658 2,011,519 4,380,247 6,944,029 936,722
LIABILITIES: -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Net assets............................................ $6,989,658 $2,011,519 $4,380,247 $6,944,029 $ 936,722
========== ========== ========== ========== ==========
Net asset distribution by category:
Variable life policies................................ $6,989,658 $2,011,519 $4,380,247 $6,944,029 $ 936,722
========== ========== ========== ========== ==========

Units outstanding, December 31, 1999.................... 2,316,395 1,497,167 3,486,667 2,203,458 732,120
Net asset value per unit, December 31, 1999............. $ 3.017472 $ 1.343550 $ 1.256285 $ 3.151423 $ 1.279465

<CAPTION>
SELECT SELECT
AGGRESSIVE SELECT GROWTH SELECT VALUE SELECT
GROWTH GROWTH AND INCOME OPPORTUNITY INCOME
---------- ---------- ----------- ------------ ----------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments in shares of Allmerica Investment Trust..... $8,599,067 $8,537,394 $5,371,582 $3,113,415 $ 369,394
Investments in shares of Fidelity Variable Insurance
Products Funds (VIP).................................. -- -- -- -- --
Investment in shares of T. Rowe Price International
Series, Inc........................................... -- -- -- -- --
Investment in shares of Delaware Group Premium Fund..... -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Total assets.......................................... 8,599,067 8,537,394 5,371,582 3,113,415 369,394
LIABILITIES: -- -- -- -- --
---------- ---------- ---------- ---------- ----------
Net assets............................................ $8,599,067 $8,537,394 $5,371,582 $3,113,415 $ 369,394
========== ========== ========== ========== ==========
Net asset distribution by category:
Variable life policies................................ $8,599,067 $8,537,394 $5,371,582 $3,113,415 $ 369,394
========== ========== ========== ========== ==========
Units outstanding, December 31, 1999.................... 3,283,745 2,493,616 2,091,260 1,793,383 329,376
Net asset value per unit, December 31, 1999............. $2.618677 $ 3.423701 $ 2.568587 $ 1.736057 $ 1.121495

<CAPTION>
SELECT
INTERNATIONAL
EQUITY
-------------
<S> <C>
ASSETS:
Investments in shares of Allmerica Investment Trust..... $6,804,763
Investments in shares of Fidelity Variable Insurance
Products Funds (VIP).................................. --
Investment in shares of T. Rowe Price International
Series, Inc........................................... --
Investment in shares of Delaware Group Premium Fund..... --
----------
Total assets.......................................... 6,804,763
LIABILITIES: --
----------
Net assets............................................ $6,804,763
==========
Net asset distribution by category:
Variable life policies................................ $6,804,763
==========
Units outstanding, December 31, 1999.................... 3,211,721
Net asset value per unit, December 31, 1999............. $ 2.118728
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-1
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SELECT SELECT SELECT FIDELITY
CAPITAL EMERGING STRATEGIC FIDELITY VIP FIDELITY VIP VIP
APPRECIATION MARKETS GROWTH HIGH INCOME EQUITY-INCOME GROWTH
------------ ---------- ---------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments in shares of Allmerica
Investment Trust................. $3,632,685 $ 477,627 $ 762,776 $ -- $ -- $ --
Investments in shares of Fidelity
Variable Insurance Products
Funds (VIP)...................... -- -- -- 3,233,961 9,185,614 11,689,429
Investment in shares of T. Rowe
Price International
Series, Inc...................... -- -- -- -- -- --
Investment in shares of Delaware
Group Premium Fund............... -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- -----------
Total assets..................... 3,632,685 477,627 762,776 3,233,961 9,185,614 11,689,429
LIABILITIES: -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- -----------
Net assets....................... $3,632,685 $ 477,627 $ 762,776 $3,233,961 $9,185,614 $11,689,429
========== ========== ========== ========== ========== ===========
Net asset distribution by category:
Variable life policies........... $3,632,685 $ 477,627 $ 762,776 $3,233,961 $9,185,614 $11,689,429
========== ========== ========== ========== ========== ===========

Units outstanding, December 31,
1999............................. 1,546,958 374,974 688,290 2,065,643 3,931,875 3,174,817
Net asset value per unit,
December 31, 1999................ $ 2.348277 $ 1.273759 $ 1.108219 $ 1.565595 $ 2.336192 $ 3.681922

<CAPTION>
FIDELITY T. ROWE PRICE DGPF
VIP FIDELITY VIP II INTERNATIONAL INTERNATIONAL
OVERSEAS ASSET MANAGER STOCK EQUITY
---------- --------------- ------------- -------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in shares of Allmerica
Investment Trust................. $ -- $ -- $ -- $ --
Investments in shares of Fidelity
Variable Insurance Products
Funds (VIP)...................... 1,692,823 1,498,263 -- --
Investment in shares of T. Rowe
Price International
Series, Inc...................... -- -- 2,636,620 --
Investment in shares of Delaware
Group Premium Fund............... -- -- -- 1,749,278
---------- ---------- ---------- ----------
Total assets..................... 1,692,823 1,498,263 2,636,620 1,749,278
LIABILITIES: -- -- -- --
---------- ---------- ---------- ----------
Net assets....................... $1,692,823 $1,498,263 $2,636,620 $1,749,278
========== ========== ========== ==========
Net asset distribution by category:
Variable life policies........... $1,692,823 $1,498,263 $2,636,620 $1,749,278
========== ========== ========== ==========
Units outstanding, December 31,
1999............................. 839,921 777,118 1,422,068 1,014,570
Net asset value per unit,
December 31, 1999................ $ 2.015455 $ 1.927973 $ 1.854075 $ 1.724157
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-2
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
GROWTH INVESTMENT GRADE INCOME
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
-------------------------------- -------------------------------
1999 1998 1997 1999 1998 1997
---------- -------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends.............................................. $ 33,997 $ 38,953 $ 31,372 $ 118,052 $75,718 $50,621
---------- -------- -------- --------- ------- -------
EXPENSES:
Mortality and expense risk fees........................ 47,745 31,495 18,158 16,432 11,096 6,698
Administrative expense fees............................ 13,466 8,883 5,122 4,634 3,130 1,889
---------- -------- -------- --------- ------- -------
Total expenses....................................... 61,211 40,378 23,280 21,066 14,226 8,587
---------- -------- -------- --------- ------- -------
Net investment income (loss)......................... (27,214) (1,425) 8,092 96,986 61,492 42,034
---------- -------- -------- --------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from portfolio sponsors.... 475,456 36,435 431,686 1,454 -- --
Net realized gain (loss) from sales of investments..... 68,882 14,365 23,025 (3,865) 6,041 1,716
---------- -------- -------- --------- ------- -------
Net realized gain (loss)............................. 544,338 50,800 454,711 (2,411) 6,041 1,716
Net unrealized gain (loss)............................. 841,945 534,100 (71,668) (131,308) 14,016 18,269
---------- -------- -------- --------- ------- -------
Net realized and unrealized gain (loss).............. 1,386,283 584,900 383,043 (133,719) 20,057 19,985
---------- -------- -------- --------- ------- -------
Net increase (decrease) in net assets from
operations......................................... $1,359,069 $583,475 $391,135 $ (36,733) $81,549 $62,019
========== ======== ======== ========= ======= =======

<CAPTION>
MONEY MARKET EQUITY INDEX
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends.............................................. $192,532 $103,860 $75,584 $ 52,058 $ 33,099 $ 16,809
-------- -------- ------- -------- -------- --------
EXPENSES:
Mortality and expense risk fees........................ 34,115 17,352 12,569 49,043 23,854 10,805
Administrative expense fees............................ 9,622 4,894 3,546 13,833 6,729 3,047
-------- -------- ------- -------- -------- --------
Total expenses....................................... 43,737 22,246 16,115 62,876 30,583 13,852
-------- -------- ------- -------- -------- --------
Net investment income (loss)......................... 148,795 81,614 59,469 (10,818) 2,516 2,957
-------- -------- ------- -------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from portfolio sponsors.... -- -- -- 8,284 91,759 46,480
Net realized gain (loss) from sales of investments..... -- -- -- 131,171 53,862 40,082
-------- -------- ------- -------- -------- --------
Net realized gain (loss)............................. -- -- -- 139,455 145,621 86,562
Net unrealized gain (loss)............................. -- -- -- 857,189 511,720 214,373
-------- -------- ------- -------- -------- --------
Net realized and unrealized gain (loss).............. -- -- -- 996,644 657,341 300,935
-------- -------- ------- -------- -------- --------
Net increase (decrease) in net assets from
operations......................................... $148,795 $ 81,614 $59,469 $985,826 $659,857 $303,892
======== ======== ======= ======== ======== ========

<CAPTION>
GOVERNMENT BOND
FOR THE YEAR ENDED
DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends.............................................. $ 48,982 $18,086 $10,918
-------- ------- -------
EXPENSES:
Mortality and expense risk fees........................ 7,418 2,575 1,719
Administrative expense fees............................ 2,092 726 485
-------- ------- -------
Total expenses....................................... 9,510 3,301 2,204
-------- ------- -------
Net investment income (loss)......................... 39,472 14,785 8,714
-------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from portfolio sponsors.... -- -- --
Net realized gain (loss) from sales of investments..... (3,983) 588 645
-------- ------- -------
Net realized gain (loss)............................. (3,983) 588 645
Net unrealized gain (loss)............................. (42,275) (265) 1,985
-------- ------- -------
Net realized and unrealized gain (loss).............. (46,258) 323 2,630
-------- ------- -------
Net increase (decrease) in net assets from
operations......................................... $ (6,786) $15,108 $11,344
======== ======= =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-3
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF OPERATIONS (CONTINUED)
<TABLE>
<CAPTION>
SELECT AGGRESSIVE GROWTH SELECT GROWTH
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
-------------------------------- --------------------------------
1999 1998 1997 1999 1998 1997
---------- -------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ -- $ -- $ -- $ 3,131 $ 2,828 $ 5,433
---------- -------- -------- ---------- -------- --------
EXPENSES:
Mortality and expense risk
fees........................... 56,418 40,529 24,141 54,056 27,550 10,338
Administrative expense fees...... 15,912 11,432 6,809 15,246 7,770 2,916
---------- -------- -------- ---------- -------- --------
Total expenses................. 72,330 51,961 30,950 69,302 35,320 13,254
---------- -------- -------- ---------- -------- --------
Net investment income (loss)... (72,330) (51,961) (30,950) (66,171) (32,492) (7,821)
---------- -------- -------- ---------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. -- -- 276,322 198,983 30,097 94,924
Net realized gain (loss) from
sales of investments........... 177,208 29,465 21,985 138,303 85,378 2,956
---------- -------- -------- ---------- -------- --------
Net realized gain (loss)....... 177,208 29,465 298,307 337,286 115,475 97,880
Net unrealized gain (loss)....... 2,105,983 426,520 178,576 1,445,329 881,261 221,502
---------- -------- -------- ---------- -------- --------
Net realized and unrealized
gain (loss).................. 2,283,191 455,985 476,883 1,782,615 996,736 319,382
---------- -------- -------- ---------- -------- --------
Net increase (decrease) in net
assets from operations....... $2,210,861 $404,024 $445,933 $1,716,444 $964,244 $311,561
========== ======== ======== ========== ======== ========

<CAPTION>
SELECT GROWTH AND INCOME SELECT VALUE OPPORTUNITY
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------ -------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 45,116 $ 30,725 $ 19,498 $ 18 $25,765 $ 10,855
-------- -------- -------- --------- ------- --------
EXPENSES:
Mortality and expense risk
fees........................... 36,123 21,317 12,838 27,600 22,210 12,654
Administrative expense fees...... 10,188 6,012 3,621 7,784 6,265 3,569
-------- -------- -------- --------- ------- --------
Total expenses................. 46,311 27,329 16,459 35,384 28,475 16,223
-------- -------- -------- --------- ------- --------
Net investment income (loss)... (1,195) 3,396 3,039 (35,366) (2,710) (5,368)
-------- -------- -------- --------- ------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 298,378 8,250 160,094 178,099 8,943 260,710
Net realized gain (loss) from
sales of investments........... 33,526 18,895 9,161 (12,326) 17,943 36,135
-------- -------- -------- --------- ------- --------
Net realized gain (loss)....... 331,904 27,145 169,255 165,773 26,886 296,845
Net unrealized gain (loss)....... 313,687 330,322 91,787 (307,116) 69,671 7,494
-------- -------- -------- --------- ------- --------
Net realized and unrealized
gain (loss).................. 645,591 357,467 261,042 (141,343) 96,557 304,339
-------- -------- -------- --------- ------- --------
Net increase (decrease) in net
assets from operations....... $644,396 $360,863 $264,081 $(176,709) $93,847 $298,971
======== ======== ======== ========= ======= ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-4
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF OPERATIONS (CONTINUED)
<TABLE>
<CAPTION>
SELECT INCOME

FOR THE SELECT INTERNATIONAL EQUITY
YEAR ENDED FOR THE FOR THE YEAR ENDED
DECEMBER 31, PERIOD DECEMBER 31,
------------------- 1/21/97* TO ---------------------------------
1999 1998 12/31/97 1999 1998 1997
-------- -------- ----------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 20,541 $ 9,342 $2,772 $ -- $ 53,844 $ 65,152
-------- ------- ------ ---------- -------- ---------
EXPENSES:
Mortality and expense risk
fees........................... 2,850 1,400 363 47,169 33,643 19,115
Administrative expense fees...... 804 395 103 13,304 9,489 5,391
-------- ------- ------ ---------- -------- ---------
Total expenses................. 3,654 1,795 466 60,473 43,132 24,506
-------- ------- ------ ---------- -------- ---------
Net investment income (loss)... 16,887 7,547 2,306 (60,473) 10,712 40,646
-------- ------- ------ ---------- -------- ---------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 2,410 -- -- -- -- 90,833
Net realized gain (loss) from
sales of investments........... (1,955) 2,849 1,822 108,900 47,368 18,453
-------- ------- ------ ---------- -------- ---------
Net realized gain (loss)....... 455 2,849 1,822 108,900 47,368 109,286
Net unrealized gain (loss)....... (23,123) (1,355) 51 1,466,320 445,157 (105,756)
-------- ------- ------ ---------- -------- ---------
Net realized and unrealized
gain (loss)................... (22,668) 1,494 1,873 1,575,220 492,525 3,530
-------- ------- ------ ---------- -------- ---------
Net increase (decrease) in net
assets from operations........ $ (5,781) $ 9,041 $4,179 $1,514,747 $503,237 $ 44,176
======== ======= ====== ========== ======== =========

SELECT EMERGING MARKETS
SELECT CAPITAL APPRECIATION
FOR THE YEAR ENDED FOR THE FOR THE
DECEMBER 31, YEAR ENDED PERIOD
------------------------------- DECEMBER 31, 2/20/98* TO
1999 1998 1997 1999 12/31/98
-------- --------- -------- ------------ -----------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ -- $ -- $ -- $ 1,567 $ 117
-------- --------- -------- -------- ------
EXPENSES:
Mortality and expense risk
fees........................... 25,747 18,236 11,854 2,480 108
Administrative expense fees...... 7,262 5,144 3,343 699 30
-------- --------- -------- -------- ------
Total expenses................. 33,009 23,380 15,197 3,179 138
-------- --------- -------- -------- ------
Net investment income (loss)... (33,009) (23,380) (15,197) (1,612) (21)
-------- --------- -------- -------- ------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 4,210 396,401 -- -- --
Net realized gain (loss) from
sales of investments........... 64,758 47,124 12,285 38,118 19
-------- --------- -------- -------- ------
Net realized gain (loss)....... 68,968 443,525 12,285 38,118 19
Net unrealized gain (loss)....... 641,346 (112,382) 217,381 120,727 2,529
-------- --------- -------- -------- ------
Net realized and unrealized
gain (loss)................... 710,314 331,143 229,666 158,845 2,548
-------- --------- -------- -------- ------
Net increase (decrease) in net
assets from operations........ $677,305 $ 307,763 $214,469 $157,233 $2,527
======== ========= ======== ======== ======
</TABLE>

* Date of initial investment.

The accompanying notes are an integral part of these financial statements.

SA-5
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF OPERATIONS (CONTINUED)
<TABLE>
<CAPTION>
SELECT STRATEGIC GROWTH
FIDELITY VIP HIGH INCOME FIDELITY VIP EQUITY-INCOME
FOR THE FOR THE FOR THE YEAR ENDED FOR THE YEAR ENDED
YEAR ENDED PERIOD DECEMBER 31, DECEMBER 31,
DECEMBER 31, 2/20/98* TO ------------------------------- ------------------------------
1999 12/31/98 1999 1998 1997 1999 1998 1997
------------ ----------- -------- --------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 2,052 $ 230 $243,230 $ 136,144 $ 68,437 $112,153 $ 70,292 $ 47,892
------- ------ -------- --------- -------- -------- -------- --------
EXPENSES:
Mortality and expense risk
fees........................... 4,550 143 26,965 19,478 11,594 76,424 54,135 32,764
Administrative expense fees...... 1,284 40 7,605 5,494 3,270 21,555 15,269 9,241
------- ------ -------- --------- -------- -------- -------- --------
Total expenses................. 5,834 183 34,570 24,972 14,864 97,979 69,404 42,005
------- ------ -------- --------- -------- -------- -------- --------
Net investment income (loss)... (3,782) 47 208,660 111,172 53,573 14,174 888 5,887
------- ------ -------- --------- -------- -------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. -- -- 9,093 86,508 8,459 247,916 250,156 240,792
Net realized gain (loss) from
sales of investments........... 8,398 (225) (54,343) (17,148) 27,979 118,286 48,500 33,101
------- ------ -------- --------- -------- -------- -------- --------
Net realized gain (loss)....... 8,398 (225) (45,250) 69,360 36,438 366,202 298,656 273,893
Net unrealized gain (loss)....... 85,146 4,598 12,522 (314,600) 103,123 (18,667) 296,484 568,672
------- ------ -------- --------- -------- -------- -------- --------
Net realized and unrealized
gain (loss).................. 93,544 4,373 (32,728) (245,240) 139,561 347,535 595,140 842,565
------- ------ -------- --------- -------- -------- -------- --------
Net increase (decrease) in net
assets from operations....... $89,762 $4,420 $175,932 $(134,068) $193,134 $361,709 $596,028 $848,452
======= ====== ======== ========= ======== ======== ======== ========

FIDELITY VIP GROWTH
FOR THE YEAR ENDED
DECEMBER 31,
----------------------------------
1999 1998 1997
---------- ---------- --------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 12,091 $ 20,074 $ 16,453
---------- ---------- --------
EXPENSES:
Mortality and expense risk
fees........................... 76,059 43,584 27,500
Administrative expense fees...... 21,452 12,292 7,756
---------- ---------- --------
Total expenses................. 97,511 55,876 35,256
---------- ---------- --------
Net investment income (loss)... (85,420) (35,802) (18,803)
---------- ---------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 760,210 525,084 73,646
Net realized gain (loss) from
sales of investments........... 287,394 86,937 47,664
---------- ---------- --------
Net realized gain (loss)....... 1,047,604 612,021 121,310
Net unrealized gain (loss)....... 1,866,657 1,092,781 495,681
---------- ---------- --------
Net realized and unrealized
gain (loss).................. 2,914,261 1,704,802 616,991
---------- ---------- --------
Net increase (decrease) in net
assets from operations....... $2,828,841 $1,669,000 $598,188
========== ========== ========
</TABLE>

* Date of initial investment.

The accompanying notes are an integral part of these financial statements.

SA-6
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF OPERATIONS (CONTINUED)
<TABLE>
<CAPTION>
FIDELITY VIP II ASSET
FIDELITY VIP OVERSEAS MANAGER
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 14,849 $13,815 $10,056 $ 37,327 $ 23,256 $ 19,924
-------- ------- ------- -------- -------- --------

EXPENSES:
Mortality and expense risk
fees........................... 10,233 7,334 5,647 11,540 7,365 5,709
Administrative expense fees...... 2,887 2,069 1,593 3,255 2,078 1,610
-------- ------- ------- -------- -------- --------
Total expenses................. 13,120 9,403 7,240 14,795 9,443 7,319
-------- ------- ------- -------- -------- --------
Net investment income (loss)... 1,729 4,412 2,816 22,532 13,813 12,605
-------- ------- ------- -------- -------- --------

REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 23,950 40,719 39,918 47,281 69,769 49,980
Net realized gain (loss) from
sales of investments........... 34,419 8,916 13,234 19,555 7,412 10,245
-------- ------- ------- -------- -------- --------
Net realized gain (loss)....... 58,369 49,635 53,152 66,836 77,181 60,225
Net unrealized gain (loss)....... 382,231 32,700 (4,255) 38,297 25,967 38,982
-------- ------- ------- -------- -------- --------
Net realized and unrealized
gain (loss).................. 440,600 82,335 48,897 105,133 103,148 99,207
-------- ------- ------- -------- -------- --------
Net increase (decrease) in net
assets from operations....... $442,329 $86,747 $51,713 $127,665 $116,961 $111,812
======== ======= ======= ======== ======== ========

<CAPTION>
T. ROWE PRICE
INTERNATIONAL STOCK DGPF INTERNATIONAL EQUITY
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends........................ $ 9,199 $ 19,378 $ 8,506 $ 26,304 $33,186 $12,296
-------- -------- -------- -------- ------- -------
EXPENSES:
Mortality and expense risk
fees........................... 16,878 11,633 5,600 12,712 9,355 5,326
Administrative expense fees...... 4,760 3,281 1,580 3,586 2,639 1,502
-------- -------- -------- -------- ------- -------
Total expenses................. 21,638 14,914 7,180 16,298 11,994 6,828
-------- -------- -------- -------- ------- -------
Net investment income (loss)... (12,439) 4,464 1,326 10,006 21,192 5,468
-------- -------- -------- -------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain distributions from
portfolio sponsors............. 28,910 6,839 12,051 1,921 -- --
Net realized gain (loss) from
sales of investments........... 166,452 8,267 5,743 27,108 5,165 5,350
-------- -------- -------- -------- ------- -------
Net realized gain (loss)....... 195,362 15,106 17,794 29,029 5,165 5,350
Net unrealized gain (loss)....... 423,296 158,394 (26,790) 159,277 59,757 (2,688)
-------- -------- -------- -------- ------- -------
Net realized and unrealized
gain (loss).................. 618,658 173,500 (8,996) 188,306 64,922 2,662
-------- -------- -------- -------- ------- -------
Net increase (decrease) in net
assets from operations....... $606,219 $177,964 $ (7,670) $198,312 $86,114 $ 8,130
======== ======== ======== ======== ======= =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-7
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
GROWTH INVESTMENT GRADE INCOME
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (27,214) $ (1,425) $ 8,092 $ 96,986 $ 61,492 $ 42,034
Net realized gain
(loss).................. 544,338 50,800 454,711 (2,411) 6,041 1,716
Net unrealized gain
(loss).................. 841,945 534,100 (71,668) (131,308) 14,016 18,269
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 1,359,069 583,475 391,135 (36,733) 81,549 62,019
----------- ----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 1,001,751 847,227 570,987 435,410 428,260 240,396
Terminations.............. (7,366) (34,880) (38,859) (3,059) (4,458) (5,462)
Insurance and other
charges................. (87,249) (69,664) (37,276) (34,431) (30,868) (19,344)
Transfers between
sub-accounts (including
fixed account), net..... 418,568 252,812 525,789 118,198 146,781 73,703
Other transfers from (to)
the General Account..... (9,475) (18,055) (10,531) (4,143) (16,249) (11,224)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from policy
transactions............ 1,316,229 977,440 1,010,110 511,975 523,466 278,069
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 2,675,298 1,560,915 1,401,245 475,242 605,015 340,088
NET ASSETS:
Beginning of year........... 4,314,360 2,753,445 1,352,200 1,536,277 931,262 591,174
----------- ----------- ----------- ----------- ----------- -----------
End of year................. $ 6,989,658 $ 4,314,360 $ 2,753,445 $ 2,011,519 $ 1,536,277 $ 931,262
=========== =========== =========== =========== =========== ===========

<CAPTION>
MONEY MARKET EQUITY INDEX
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASS
FROM OPERATIONS:
Net investment income
(loss).................. $ 148,795 $ 81,614 $ 59,469 $ (10,818) $ 2,516 $ 2,957
Net realized gain
(loss).................. -- -- -- 139,455 145,621 86,562
Net unrealized gain
(loss).................. -- -- -- 857,189 511,720 214,373
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 148,795 81,614 59,469 985,826 659,857 303,892
----------- ----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 5,181,354 2,700,829 1,862,402 1,145,533 756,206 431,987
Terminations.............. (705,904) (11,590) (105,934) (10,279) (4,368) (3,898)
Insurance and other
charges................. (142,203) (94,257) (71,152) (56,356) (31,530) (13,877)
Transfers between
sub-accounts (including
fixed account), net..... (3,430,574) (895,626) (1,257,458) 1,048,621 726,135 426,720
Other transfers from (to)
the General Account..... 28,565 (38,413) (15,514) (9,702) 5,145 (6,762)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from policy
transactions............ 931,238 1,660,943 412,344 2,117,817 1,451,588 834,170
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 1,080,033 1,742,557 471,813 3,103,643 2,111,445 1,138,062
NET ASSETS:
Beginning of year........... 3,300,214 1,557,657 1,085,844 3,840,386 1,728,941 590,879
----------- ----------- ----------- ----------- ----------- -----------
End of year................. $ 4,380,247 $ 3,300,214 $ 1,557,657 $ 6,944,029 $ 3,840,386 $ 1,728,941
=========== =========== =========== =========== =========== ===========

<CAPTION>
GOVERNMENT BOND
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASS
FROM OPERATIONS:
Net investment income
(loss).................. $ 39,472 $ 14,785 $ 8,714
Net realized gain
(loss).................. (3,983) 588 645
Net unrealized gain
(loss).................. (42,275) (265) 1,985
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. (6,786) 15,108 11,344
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 161,884 191,827 134,405
Terminations.............. -- (1,554) (63)
Insurance and other
charges................. (26,372) (18,262) (11,345)
Transfers between
sub-accounts (including
fixed account), net..... 270,794 172,202 (120,761)
Other transfers from (to)
the General Account..... (1,924) (1,510) (3,555)
----------- ----------- -----------
Net increase (decrease) in
net assets from policy
transactions............ 404,382 342,703 (1,319)
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 397,596 357,811 10,025
NET ASSETS:
Beginning of year........... 539,126 181,315 171,290
----------- ----------- -----------
End of year................. $ 936,722 $ 539,126 $ 181,315
=========== =========== ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-8
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
SELECT AGGRESSIVE GROWTH SELECT GROWTH
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (72,330) $ (51,961) $ (30,950) $ (66,171) $ (32,492) $ (7,821)
Net realized gain
(loss).................. 177,208 29,465 298,307 337,286 115,475 97,880
Net unrealized gain
(loss).................. 2,105,983 426,520 178,576 1,445,329 881,261 221,502
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 2,210,861 404,024 445,933 1,716,444 964,244 311,561
----------- ----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 1,229,002 1,111,123 850,410 1,511,763 937,287 489,937
Terminations.............. (81,020) (66,319) (23,475) (1,322) (5,519) (2,969)
Insurance and other
charges................. (65,617) (63,181) (34,391) (74,749) (47,080) (18,331)
Transfers between
sub-accounts (including
fixed account), net..... (134,485) 546,728 709,217 830,475 867,942 621,990
Other transfers from (to)
the General
Account................. (67,598) (988) (2,444) (28,078) (15,686) (11,795)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 880,282 1,527,363 1,499,317 2,238,089 1,736,944 1,078,832
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 3,091,143 1,931,387 1,945,250 3,954,533 2,701,188 1,390,393
NET ASSETS:
Beginning of year........... 5,507,924 3,576,537 1,631,287 4,582,861 1,881,673 491,280
----------- ----------- ----------- ----------- ----------- -----------
End of year................. $ 8,599,067 $ 5,507,924 $ 3,576,537 $ 8,537,394 $ 4,582,861 $ 1,881,673
=========== =========== =========== =========== =========== ===========

<CAPTION>
SELECT GROWTH AND INCOME
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (1,195) $ 3,396 $ 3,039
Net realized gain
(loss).................. 331,904 27,145 169,255
Net unrealized gain
(loss).................. 313,687 330,322 91,787
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 644,396 360,863 264,081
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 1,004,832 573,753 335,796
Terminations.............. (10,984) (21,474) (2,655)
Insurance and other
charges................. (59,665) (42,732) (21,783)
Transfers between
sub-accounts (including
fixed account), net..... 795,513 283,832 299,842
Other transfers from (to)
the General
Account................. (25,120) (24,248) (4,085)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 1,704,576 769,131 607,115
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 2,348,972 1,129,994 871,196
NET ASSETS:
Beginning of year........... 3,022,610 1,892,616 1,021,420
----------- ----------- -----------
End of year................. $ 5,371,582 $ 3,022,610 $ 1,892,616
=========== =========== ===========

<CAPTION>
SELECT VALUE OPPORTUNITY
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (35,366) $ (2,710) $ (5,368)
Net realized gain
(loss).................. 165,773 26,886 296,845
Net unrealized gain
(loss).................. (307,116) 69,671 7,494
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. (176,709) 93,847 298,971
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 620,660 508,455 426,674
Terminations.............. (36,241) (39,141) (3,636)
Insurance and other
charges................. (33,184) (28,795) (11,382)
Transfers between
sub-accounts (including
fixed account), net..... (278,029) 561,220 399,651
Other transfers from (to)
the General
Account................. (51,296) (5,874) (10,191)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 221,910 995,865 801,116
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 45,201 1,089,712 1,100,087
NET ASSETS:
Beginning of year........... 3,068,214 1,978,502 878,415
----------- ----------- -----------
End of year................. $ 3,113,415 $ 3,068,214 $ 1,978,502
=========== =========== ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-9
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
SELECT INCOME
SELECT INTERNATIONAL EQUITY
YEAR ENDED YEAR ENDED
DECEMBER 31, PERIOD FROM DECEMBER 31,
-------------------------- FROM 1/21/97* ----------------------------------------
1999 1998 TO 12/31/97 1999 1998 1997
------------ ------------ ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ 16,887 $ 7,547 $ 2,306 $ (60,473) $ 10,712 $ 40,646
Net realized gain
(loss).................. 455 2,849 1,822 108,900 47,368 109,286
Net unrealized gain
(loss).................. (23,123) (1,355) 51 1,466,320 445,157 (105,756)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. (5,781) 9,041 4,179 1,514,747 503,237 44,176
----------- ----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 136,167 73,121 31,497 1,259,546 1,057,851 840,919
Terminations.............. -- -- -- (78,030) (33,620) (4,475)
Insurance and other
charges................. (5,391) (2,414) (531) (56,948) (48,162) (26,182)
Transfers between
sub-accounts (including
fixed account), net..... (10,293) 90,628 56,319 (191,180) 20,936 896,624
Other transfers from (to)
the General
Account................. (6,669) (10) (469) (18,541) (20,849) (37,089)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 113,814 161,325 86,816 914,847 976,156 1,669,797
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 108,033 170,366 90,995 2,429,594 1,479,393 1,713,973
NET ASSETS:
Beginning of year........... 261,361 90,995 -- 4,375,169 2,895,776 1,181,803
----------- ----------- ----------- ----------- ----------- -----------
End of year................. $ 369,394 $ 261,361 $ 90,995 $ 6,804,763 $ 4,375,169 $ 2,895,776
=========== =========== =========== =========== =========== ===========

SELECT CAPITAL APPRECIATION
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (33,009) $ (23,380) $ (15,197)
Net realized gain
(loss).................. 68,968 443,525 12,285
Net unrealized gain
(loss).................. 641,346 (112,382) 217,381
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 677,305 307,763 214,469
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 589,677 508,509 537,854
Terminations.............. (57,253) (38,613) (18,442)
Insurance and other
charges................. (27,655) (27,532) (10,760)
Transfers between
sub-accounts (including
fixed account), net..... (156,990) 50,954 163,964
Other transfers from (to)
the General
Account................. (12,192) (6,438) (30,901)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 335,587 486,880 641,715
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 1,012,892 794,643 856,184
NET ASSETS:
Beginning of year........... 2,619,793 1,825,150 968,966
----------- ----------- -----------
End of year................. $ 3,632,685 $ 2,619,793 $ 1,825,150
=========== =========== ===========

SELECT EMERGING MARKETS

YEAR ENDED PERIOD FROM
DECEMBER 31, FROM 2/20/98*
1999 TO 12/31/98
------------- -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (1,612) $ (21)
Net realized gain
(loss).................. 38,118 19
Net unrealized gain
(loss).................. 120,727 2,529
----------- -----------
Net increase (decrease) in
net assets from
operations.............. 157,233 2,527
----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 170,639 8,617
Terminations.............. -- --
Insurance and other
charges................. (2,381) (96)
Transfers between
sub-accounts (including
fixed account), net..... 91,849 54,663
Other transfers from (to)
the General
Account................. (5,390) (34)
----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 254,717 63,150
----------- -----------
Net increase (decrease) in
net assets.............. 411,950 65,677
NET ASSETS:
Beginning of year........... 65,677 --
----------- -----------
End of year................. $ 477,627 $ 65,677
=========== ===========
</TABLE>

* Date of initial investment.

The accompanying notes are an integral part of these financial statements.

SA-10
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
SELECT STRATEGIC GROWTH FIDELITY VIP HIGH INCOME
YEAR ENDED
YEAR ENDED PERIOD FROM DECEMBER 31,
DECEMBER 31, FROM 2/20/98* ----------------------------------------
1999 TO 12/31/98 1999 1998 1997
------------- ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (3,782) $ 47 $ 208,660 $ 111,172 $ 53,573
Net realized gain
(loss).................. 8,398 (225) (45,250) 69,360 36,438
Net unrealized gain
(loss).................. 85,146 4,598 12,522 (314,600) 103,123
----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 89,762 4,420 175,932 (134,068) 193,134
----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 167,764 41,394 815,465 658,679 528,737
Terminations.............. -- -- (24,071) (8,960) (21,270)
Insurance and other
charges................. (4,658) (98) (43,331) (33,607) (20,126)
Transfers between
sub-accounts (including
fixed account), net..... 415,836 51,873 (35,392) 78,348 314,319
Other transfers from (to)
the General
Account................. (3,477) (40) (19,586) (23,944) (1,637)
----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 575,465 93,129 693,085 670,516 800,023
----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 665,227 97,549 869,017 536,448 993,157
NET ASSETS:
Beginning of year........... 97,549 -- 2,364,944 1,828,496 835,339
----------- ----------- ----------- ----------- -----------
End of year................. $ 762,776 $ 97,549 $ 3,233,961 $ 2,364,944 $ 1,828,496
=========== =========== =========== =========== ===========

<CAPTION>
FIDELITY VIP EQUITY-INCOME
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ 14,174 $ 888 $ 5,887
Net realized gain
(loss).................. 366,202 298,656 273,893
Net unrealized gain
(loss).................. (18,667) 296,484 568,672
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 361,709 596,028 848,452
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 1,826,411 1,337,780 1,110,022
Terminations.............. (96,050) (39,425) (57,841)
Insurance and other
charges................. (135,557) (112,002) (66,454)
Transfers between
sub-accounts (including
fixed account), net..... (77,068) 726,002 292,900
Other transfers from (to)
the General
Account................. (36,303) 1,706 (3,553)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 1,481,433 1,914,061 1,275,074
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 1,843,142 2,510,089 2,123,526
NET ASSETS:
Beginning of year........... 7,342,472 4,832,383 2,708,857
----------- ----------- -----------
End of year................. $ 9,185,614 $ 7,342,472 $ 4,832,383
=========== =========== ===========

<CAPTION>
FIDELITY VIP GROWTH
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (85,420) $ (35,802) $ (18,803)
Net realized gain
(loss).................. 1,047,604 612,021 121,310
Net unrealized gain
(loss).................. 1,866,657 1,092,781 495,681
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 2,828,841 1,669,000 598,188
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 1,714,137 920,904 779,115
Terminations.............. (93,641) (37,398) (56,581)
Insurance and other
charges................. (109,297) (74,418) (46,966)
Transfers between
sub-accounts (including
fixed account), net..... 776,351 376,416 174,998
Other transfers from (to)
the General
Account................. (66,702) (19,256) (11,113)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 2,220,848 1,166,248 839,453
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 5,049,689 2,835,248 1,437,641
NET ASSETS:
Beginning of year........... 6,639,740 3,804,492 2,366,851
----------- ----------- -----------
End of year................. $11,689,429 $ 6,639,740 $ 3,804,492
=========== =========== ===========
</TABLE>

* Date of Initial Investment.

The accompanying notes are an integral part of these financial statements.

SA-11
<PAGE>
INHEIRITAGE ACCOUNT
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
FIDELITY VIP OVERSEAS FIDELITY VIP II ASSET MANAGER
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
---------------------------------------- ----------------------------------------
1999 1998 1997 1999 1998 1997
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ 1,729 $ 4,412 $ 2,816 $ 22,532 $ 13,813 $ 12,605
Net realized gain
(loss).................. 58,369 49,635 53,152 66,836 77,181 60,225
Net unrealized gain
(loss).................. 382,231 32,700 (4,255) 38,297 25,967 38,982
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 442,329 86,747 51,713 127,665 116,961 111,812
----------- ----------- ----------- ----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 152,148 131,818 124,750 233,037 150,597 93,609
Terminations.............. (37,956) (15,558) (11,669) -- (290) (52,989)
Insurance and other
charges................. (13,626) (11,464) (9,180) (31,095) (25,822) (19,243)
Transfers between
sub-accounts (including
fixed account), net..... 225,496 78,976 (45,201) 76,364 147,876 54,309
Other transfers from (to)
the General
Account................. (14,023) (6,888) 9,346 (16,765) (1,770) (2,097)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 312,039 176,884 68,046 261,541 270,591 73,589
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
net assets.............. 754,368 263,631 119,759 389,206 387,552 185,401
NET ASSETS:
Beginning of year........... 938,455 674,824 555,065 1,109,057 721,505 536,104
----------- ----------- ----------- ----------- ----------- -----------
End of year................. $ 1,692,823 $ 938,455 $ 674,824 $ 1,498,263 $ 1,109,057 $ 721,505
=========== =========== =========== =========== =========== ===========

<CAPTION>
T. ROWE PRICE INTERNATIONAL STOCK
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ (12,439) $ 4,464 $ 1,326
Net realized gain
(loss).................. 195,362 15,106 17,794
Net unrealized gain
(loss).................. 423,296 158,394 (26,790)
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 606,219 177,964 (7,670)
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 470,694 391,645 333,744
Terminations.............. (2,463) (31,322) (3,009)
Insurance and other
charges................. (21,938) (18,589) (6,416)
Transfers between
sub-accounts (including
fixed account), net..... (96,521) 245,333 268,869
Other transfers from (to)
the General
Account................. (3,485) (16,283) (470)
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 346,287 570,784 592,718
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 952,506 748,748 585,048
NET ASSETS:
Beginning of year........... 1,684,114 935,366 350,318
----------- ----------- -----------
End of year................. $ 2,636,620 $ 1,684,114 $ 935,366
=========== =========== ===========

<CAPTION>
DGPF INTERNATIONAL EQUITY
YEAR ENDED
DECEMBER 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
FROM OPERATIONS:
Net investment income
(loss).................. $ 10,006 $ 21,192 $ 5,468
Net realized gain
(loss).................. 29,029 5,165 5,350
Net unrealized gain
(loss).................. 159,277 59,757 (2,688)
----------- ----------- -----------
Net increase (decrease) in
net assets from
operations.............. 198,312 86,114 8,130
----------- ----------- -----------
FROM POLICY TRANSACTIONS:
Net premiums.............. 301,895 311,833 253,032
Terminations.............. (6,292) (18,210) (18,839)
Insurance and other
charges................. (12,879) (10,911) (6,477)
Transfers between
sub-accounts (including
fixed account), net..... 31,016 71,555 232,533
Other transfers from (to)
the General
Account................. (15,316) 2,673 26,574
----------- ----------- -----------
Net increase (decrease) in
net assets from
policy transactions..... 298,424 356,940 486,823
----------- ----------- -----------
Net increase (decrease) in
net assets.............. 496,736 443,054 494,953
NET ASSETS:
Beginning of year........... 1,252,542 809,488 314,535
----------- ----------- -----------
End of year................. $ 1,749,278 $ 1,252,542 $ 809,488
=========== =========== ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.

SA-12
<PAGE>
INHEIRITAGE ACCOUNT
NOTES TO FINANCIAL STATEMENTS

NOTE 1 -- ORGANIZATION

The Inheiritage Account (Inheiritage) is a separate investment account of
Allmerica Financial Life Insurance and Annuity Company (the Company),
established on April 21, 1994 for the purpose of separating from the general
assets of the Company those assets used to fund the variable portion of certain
flexible premium variable life policies issued by the Company. The Company is a
wholly-owned subsidiary of First Allmerica Financial Life Insurance Company
(First Allmerica). First Allmerica is a wholly-owned subsidiary of Allmerica
Financial Corporation (AFC). Under applicable insurance law, the assets and
liabilities of Inheiritage are clearly identified and distinguished from the
other assets and liabilities of the Company. Inheiritage cannot be charged with
liabilities arising out of any other business of the Company.

Inheiritage is registered as a unit investment trust under the Investment
Company Act of 1940, as amended (the 1940 Act). Inheiritage currently offers
twenty-one Sub-Accounts under the policies. Each Sub-Account invests exclusively
in a corresponding investment portfolio of the Allmerica Investment Trust (the
Trust) managed by Allmerica Financial Investment Management Service, Inc.
(AFIMS), a wholly-owned subsidiary of the Company; or of the Variable Insurance
Products Fund (Fidelity VIP), or the Variable Insurance Products Fund II
(Fidelity VIP II), managed by Fidelity Management & Research Company (FMR); or
of the T.Rowe Price International Series, Inc. (T. Rowe Price) managed by Rowe
Price-Fleming International, Inc.; or of the Delaware Group Premium Fund (DGPF)
managed by Delaware International Advisers, Ltd. The Trust, Fidelity VIP,
Fidelity VIP II, T. Rowe Price, and DGPF (the Funds) are open-end, diversified,
management investment companies registered under the 1940 Act.

Effective May 1, 2000, AIT Investment Grade Income Fund will be renamed
Select Investment Grade Income Fund and AIT Growth Fund will be renamed Core
Equity Fund.

NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES

INVESTMENTS -- Security transactions are recorded on the trade date.
Investments held by the Sub-Accounts are stated at the net asset value per share
of the respective investment portfolio of the Funds. Realized gains and losses
on securities sold are determined using the average cost method. Dividends and
capital gain distributions are recorded on the ex-dividend date and are
reinvested in additional shares of the respective investment portfolio of the
Funds at net asset value.

FEDERAL INCOME TAXES -- The Company is taxed as a "life insurance company"
under Subchapter L of the Internal Revenue Code (the Code) and files a
consolidated federal income tax return with First Allmerica. The Company
anticipates no tax liability resulting from the operations of Inheiritage.
Therefore, no provision for income taxes has been charged against Inheiritage.

SA-13
<PAGE>
INHEIRITAGE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 3 -- INVESTMENTS

The number of shares owned, aggregate cost, and net asset value per share of
each Sub-Account's investment in the Funds at December 31, 1999 were as follows:

<TABLE>
<CAPTION>
PORTFOLIO INFORMATION
--------------------------------
NET ASSET
NUMBER OF AGGREGATE VALUE
INVESTMENT PORTFOLIO SHARES COST PER SHARE
- -------------------- --------- ---------- ---------
<S> <C> <C> <C>
Growth................................................ 2,111,041 $5,632,953 $ 3.311
Investment Grade Income............................... 1,913,909 2,109,839 1.051
Money Market.......................................... 4,380,247 4,380,247 1.000
Equity Index.......................................... 1,710,352 5,289,909 4.060
Government Bond....................................... 926,530 977,733 1.011
Select Aggressive Growth.............................. 2,520,981 5,687,227 3.411
Select Growth......................................... 2,800,063 5,997,548 3.049
Select Growth and Income.............................. 2,778,883 4,537,282 1.933
Select Value Opportunity.............................. 2,046,952 3,204,711 1.521
Select Income......................................... 387,612 393,821 0.953
Select International Equity........................... 3,350,450 4,844,494 2.031
Select Capital Appreciation........................... 1,769,452 2,866,642 2.053
Select Emerging Markets............................... 369,680 354,371 1.292
Select Strategic Growth............................... 677,421 673,032 1.126
Fidelity VIP High Income.............................. 285,938 3,380,695 11.310
Fidelity VIP Equity-Income............................ 357,278 7,967,422 25.710
Fidelity VIP Growth................................... 212,806 7,939,237 54.930
Fidelity VIP Overseas................................. 61,692 1,212,225 27.440
Fidelity VIP II Asset Manager......................... 80,250 1,323,529 18.670
T. Rowe Price International Stock..................... 138,478 2,062,653 19.040
DGPF International Equity............................. 93,896 1,494,572 18.630
</TABLE>

NOTE 4 -- RELATED PARTY TRANSACTIONS

On the date of issue and each monthly payment date thereafter, a monthly
charge is deducted from the policy value to compensate the Company for the cost
of insurance, which varies by policy, the cost of any additional benefits
provided by rider, and a monthly administrative charge. The policyowner may
instruct the Company to deduct this monthly charge from a specific Sub-Account,
but if not so specified, it will be deducted on a pro-rata basis of allocation
which is the same proportion that the policy value in the General Account of the
Company and in each Sub-Account bear to the total policy value.

The Company makes a charge of 0.90% per annum based on the average daily net
assets of each Sub-Account at each valuation date for mortality and expense
risks. The mortality and expense risk charge may be increased or decreased by
the Board of Directors of the Company once each year, subject to compliance with
applicable state and federal requirements, but the total charge may not exceed
0.90% per annum. During the first 15 policy years, the Company also charges each
Sub-Account 0.25% per annum based on the average daily net assets of each
Sub-Account for administrative expenses. These charges are deducted in the daily
computation of unit values and paid to the Company on a daily basis.

SA-14
<PAGE>
INHEIRITAGE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 4 -- RELATED PARTY TRANSACTIONS (CONTINUED)

Allmerica Investments, Inc., (Allmerica Investments), a wholly-owned
subsidiary of the Company, is principal underwriter and general distributor of
Inheiritage, and does not receive any compensation for sales of Inheiritage
policies. Commissions are paid to registered representatives of Allmerica
Investments and to certain independent broker-dealers by the Company. The
current series of policies have a surrender charge and no deduction is made for
sales charges at the time of the sale.

NOTE 5 -- DIVERSIFICATION REQUIREMENTS

Under the provisions of Section 817(h) of the Code, a variable life
insurance policy, other than a policy issued in connection with certain types of
employee benefit plans, will not be treated as a variable life insurance policy
for federal income tax purposes for any period for which the investments of the
segregated asset account on which the policy is based are not adequately
diversified. The Code provides that the "adequately diversified" requirement may
be met if the underlying investments satisfy either a statutory safe harbor test
or diversification requirements set forth in regulations issued by the Secretary
of The Treasury.

The Internal Revenue Service has issued regulations under Section 817(h) of
the Code. The Company believes that Inheiritage satisfies the current
requirements of the regulations, and it intends that Inheiritage will continue
to meet such requirements.

NOTE 6 -- PURCHASES AND SALES OF SECURITIES

Cost of purchases and proceeds from sales of shares of the Funds by
Inheiritage during the year ended December 31, 1999 were as follows:

<TABLE>
<CAPTION>
INVESTMENT PORTFOLIO PURCHASES SALES
- -------------------- ----------- -----------
<S> <C> <C>
Growth...................................................... $ 2,208,013 $ 443,542
Investment Grade Income..................................... 868,887 258,472
Money Market................................................ 8,277,640 7,197,607
Equity Index................................................ 2,754,145 638,862
Government Bond............................................. 599,096 155,242
Select Aggressive Growth.................................... 1,719,513 911,561
Select Growth............................................... 3,051,778 680,877
Select Growth and Income.................................... 2,193,178 191,419
Select Value Opportunity.................................... 1,161,360 796,717
Select Income............................................... 179,944 46,833
Select International Equity................................. 1,512,605 658,231
Select Capital Appreciation................................. 1,132,306 825,518
Select Emerging Markets..................................... 502,405 249,300
Select Strategic Growth..................................... 730,650 158,967
Fidelity VIP High Income.................................... 1,593,148 682,309
Fidelity VIP Equity-Income.................................. 2,551,994 808,472
Fidelity VIP Growth......................................... 4,109,836 1,214,200
Fidelity VIP Overseas....................................... 553,715 215,997
Fidelity VIP II Asset Manager............................... 587,436 256,082
T. Rowe Price International Stock........................... 1,502,935 1,140,177
DGPF International Equity................................... 602,224 291,873
----------- -----------
$38,392,808 $17,822,258
=========== ===========
</TABLE>

SA-15
<PAGE>
INHEIRITAGE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 7 -- PLAN OF SUBSTITUTION FOR PORTFOLIO OF THE TRUST

An application has been filed with the Securities and Exchange Commission
(SEC) seeking an order approving the substitution of shares of the Select
Investment Grade Income Fund (SIGIF) for all of the shares of the Select Income
Fund (SIF). To the extent required by law, approvals of such substitution will
also be obtained from the state insurance regulators in certain jurisdictions.
The effect of the substitution will be to replace SIF shares with SIGIF shares.
The substitution is planned to be effective on or about July 1, 2000.

SA-16
<PAGE>
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
WORCESTER, MASSACHUSETTS
INDIVIDUAL JOINT SURVIVORSHIP FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES
ALLMERICA SELECT INHEIRITAGE

This Prospectus provides important information about Allmerica Select
Inheiritage, an individual joint survivorship flexible premium variable life
insurance policy issued by Allmerica Financial Life Insurance and Annuity
Company. The policies are funded through the Inheiritage Account, a separate
investment account of the Company that is referred to as the Separate Account.
Life insurance coverage is provided for two Insureds, with Death Proceeds
payable at death of the last surviving Insured. Applicants must be Age 80 or
under with respect to the younger Insured, and Age 85 or under with respect to
the older Insured. PLEASE READ THIS PROSPECTUS CAREFULLY BEFORE INVESTING AND
KEEP IT FOR FUTURE REFERENCE.

<TABLE>
<S> <C>
FUND MANAGER
Select Emerging Markets Fund Schroder Investment Management North America Inc.
Select International Equity Fund Bank of Ireland Asset Management (U.S.) Limited
T. Rowe Price International Rowe Price-Fleming International, Inc.
Stock Portfolio Nicholas-Applegate Capital Management, L.P.
Select Aggressive Growth Fund T. Rowe Price Associates, Inc.
Select Capital Appreciation Fund Cramer Rosenthal McGlynn, LLC
Select Value Opportunity Fund Putnam Investment Management, Inc.
Select Growth Fund TCW Investment Management Company
Select Strategic Growth Fund Fidelity Management & Research Company
Fidelity VIP Growth Portfolio J. P. Morgan Investment Management Inc.
Select Growth and Income Fund Fidelity Management & Research Company
Fidelity VIP Equity-Income Portfolio Fidelity Management & Research Company
Fidelity VIP High Income Portfolio Standish, Ayer & Wood, Inc.
Select Income Fund* Allmerica Asset Management, Inc.
Money Market Fund
</TABLE>

*The Company has requested the necessary regulatory approvals to substitute
shares of the Select Investment Grade Income Fund of the Allmerica Investment
Trust for shares of the currently offered Select Income Fund. Subject to
receiving the necessary approvals, this substitution will take place on or about
July 1, 2000.

Policyowners may, within limits, choose the amount of initial payment and vary
the frequency and amount of future payments. The Policy allows partial
withdrawals and full surrender of the Policy's surrender value, within limits.
The Policies are not suitable for short-term investment because of the
substantial nature of the surrender charge. If the Policyowner thinks about
surrendering the Policy, the lower deferred sales charges that apply during the
first two years from the Date of Issue or an increase in the Face Amount should
be considered.

This Prospectus can also be obtained from the Securities and Exchange
Commission's website (http://www.sec.gov).

<TABLE>
<S> <C>
CORRESPONDENCE MAY BE MAILED TO: DATED MAY 1, 2000
ALLMERICA SELECT INHEIRITAGE 440 LINCOLN STREET
P.O. BOX 8179 WORCESTER, MASSACHUSETTS 01653
BOSTON, MA 02266-8179 (508) 855-1000
</TABLE>
<PAGE>
TABLE OF CONTENTS

<TABLE>
<S> <C>
SPECIAL TERMS............................................... 4
SUMMARY OF FEES AND CHARGES................................. 7
SUMMARY OF POLICY FEATURES.................................. 11
DESCRIPTION OF THE COMPANY, THE SEPARATE ACCOUNT, AND THE
UNDERLYING FUNDS........................................... 19
INVESTMENT OBJECTIVES AND POLICIES.......................... 22
SUBSTITUTION OF SHARES OF THE SELECT INCOME FUND............ 23
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS........... 24
THE POLICY.................................................. 25
Applying for the Policy................................... 25
Free-Look Period.......................................... 25
Conversion Privileges..................................... 26
Premium Payments.......................................... 26
Incentive Funding Discount................................ 27
Guaranteed Death Benefit Rider............................ 28
Paid-up Insurance Option.................................. 29
Allocation of Net Premiums................................ 29
Transfer Privilege........................................ 30
Death Proceeds............................................ 31
Sum Insured Options....................................... 32
Change in Sum Insured Option.............................. 35
Change in Face Amount..................................... 35
Policy Value and Surrender Value.......................... 36
Death Proceeds Payment Options............................ 38
Optional Insurance Benefits............................... 38
Policy Surrender.......................................... 38
Partial Withdrawals....................................... 39
CHARGES AND DEDUCTIONS...................................... 40
Tax Expense Charge........................................ 40
Premium Expense Charge.................................... 40
Monthly Deduction from Policy Value....................... 40
Charges Against Assets of the Separate Account............ 42
Surrender Charge.......................................... 43
Charges on Partial Withdrawals............................ 44
Transfer Charges.......................................... 45
Charge for Increase in Face Amount........................ 45
Other Administrative Charges.............................. 46
POLICY LOANS................................................ 46
Repayment of Loans........................................ 47
Effect of Policy Loans.................................... 47
POLICY TERMINATION AND REINSTATEMENT........................ 47
Termination............................................... 47
Reinstatement............................................. 48
OTHER POLICY PROVISIONS..................................... 49
Policyowner............................................... 49
Beneficiary............................................... 49
Incontestability.......................................... 49
Suicide................................................... 49
Notice of First Insured to Die............................ 49
Age....................................................... 49
Assignment................................................ 49
Postponement of Payments.................................. 50
</TABLE>

2
<PAGE>

<TABLE>
<S> <C>
VOTING RIGHTS............................................... 50
DIRECTORS AND PRINCIPAL OFFICERS OF THE COMPANY............. 51
DISTRIBUTION................................................ 52
REPORTS..................................................... 52
LEGAL PROCEEDINGS........................................... 53
FURTHER INFORMATION......................................... 53
INDEPENDENT ACCOUNTANTS..................................... 53
FEDERAL TAX CONSIDERATIONS.................................. 53
The Company and the Separate Account...................... 53
Taxation of the Policies.................................. 54
Modified Endowment Contracts.............................. 55
Estate and Generation-Skipping Taxes...................... 55
MORE INFORMATION ABOUT THE GENERAL ACCOUNT.................. 56
General Description....................................... 56
General Account Value and Policy Loans.................... 56
The Policy................................................ 57
Transfers, Surrenders, and Partial Withdrawals............ 57
FINANCIAL STATEMENTS........................................ 57
APPENDIX A -- OPTIONAL BENEFITS............................. A-1
APPENDIX B -- PAYMENT OPTIONS............................... B-1
APPENDIX C -- ILLUSTRATIONS................................. C-1
APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES...... D-1
APPENDIX E -- PERFORMANCE INFORMATION....................... E-1
FINANCIAL STATEMENTS........................................ FIN-1
</TABLE>

3
<PAGE>
SPECIAL TERMS

ACCUMULATION UNIT: A measure of the Policyowner's interest in a Sub-Account.

AGE: An Insured's age as of the nearest birthday measured from the Policy
anniversary.

BENEFICIARY: The person(s) designated by the owner of the Policy to receive the
insurance proceeds upon the death of the last surviving Insured.

COMPANY: Allmerica Financial Life Insurance and Annuity Company. "We," "our,"
"us," and "the Company" refer to Allmerica Financial Life Insurance and Annuity
Company in this Prospectus.

DATE OF ISSUE: The date set forth in the Policy used to determine the Monthly
Payment Date, Policy months, Policy years, and Policy anniversaries.

DEATH PROCEEDS: Prior to the Final Premium Payment Date, the Death Proceeds
equal the amount calculated under the applicable Sum Insured Option (Option 1 or
Option 2), less Debt outstanding at death of the last surviving Insured, partial
withdrawals, if any, partial withdrawal charges, and any due and unpaid Monthly
Deductions. After the Final Premium Payment Date, the Death Proceeds equal the
Surrender Value of the Policy, unless the Guaranteed Death Benefit Rider is in
effect. If the Rider is in effect, the Death Proceeds will be the greater of
(a) the Face Amount as of the Final Premium Payment Date, or (b) the Policy
Value as of the date due proof of death for Option 2 and date of death for
Option 1 is received by the Company. This Rider may not be available in all
states.

DEBT: All unpaid Policy loans plus interest due or accrued on such loans.

DELIVERY RECEIPT: An acknowledgment, signed by the Policyowner and returned to
the Company's Principal Office, that the Policyowner has received the Policy and
the Notice of Withdrawal Rights.

EVIDENCE OF INSURABILITY: Information, including medical information
satisfactory to the Company, that is used to determine the Insureds' Premium
Class.

FACE AMOUNT: The amount of insurance coverage applied for. The Face Amount of
each Policy is set forth in the specifications pages of the Policy.

GENERAL ACCOUNT: All the assets of the Company other than those held in a
Separate Account.

GUIDELINE ANNUAL PREMIUM: The annual amount of premium that would be payable
through the Final Premium Payment Date of the Policy for the specified Sum
Insured, if premiums were fixed by the Company as to both timing and amount, and
monthly cost of insurance charges were based on the 1980 Commissioners Standard
Ordinary Mortality Table D, Smoker or Non-Smoker, net investment earnings at an
annual effective rate of 5%, and fees and charges as set forth in the Policy and
any Policy riders. The Sum Insured Option 1 Guideline Annual Premium is used
when calculating the maximum surrender charge.

GUIDELINE MINIMUM SUM INSURED: The minimum Sum Insured required to qualify the
Policy as "life insurance" under federal tax laws. The Guideline Minimum Sum
Insured varies by Age. It is calculated by multiplying the Policy Value by a
percentage determined by the younger Insured's Age.

4
<PAGE>
The percentage factor is a percentage that, when multiplied by the Policy Value,
determines the minimum death benefit required under federal tax laws. For both
the Option 1 and the Option 2, the percentage factor is based on the younger
Insured's attained age on Death of Last Surviving Insured, as set forth in
GUIDELINE MINIMUM SUM INSURED TABLE 1 and TABLE 2 in SUM INSURED OPTIONS --
"GUIDELINE MINIMUM SUM INSURED".

INSURANCE AMOUNT AT RISK: The Sum Insured less the Policy Value.

INSUREDS: The two persons covered under the Policy.

LOAN VALUE: The maximum amount that may be borrowed under the Policy.

- Debt does not exceed Policy Value less surrender charges, then

- the Policy is guaranteed not to lapse during that period.

EXCEPT FOR THE 48 POLICY MONTH PERIODS, MAKING MONTHLY PAYMENTS AT LEAST EQUAL
TO THE MINIMUM MONTHLY FACTOR DOES NOT GUARANTEE THAT THE POLICY WILL REMAIN IN
FORCE.

MONTHLY DEDUCTION: Charges deducted monthly from the Policy Value prior to the
Final Premium Payment Date. The charges include the monthly cost of insurance,
the monthly cost of any benefits provided by riders, and the monthly
administrative charge.

MONTHLY PAYMENT DATE: The date on which the Monthly Deduction is deducted from
the Policy Value.

NET PREMIUM: An amount equal to the premium less a tax expense charge and
premium expense charge.

PAID-UP INSURANCE: Joint survivorship insurance coverage for the lifetime of the
Insureds, with no further premiums due.

POLICY CHANGE: Any change in the Face Amount, the addition or deletion of a
rider, or a change in the Sum Insured Option.

POLICY VALUE: The total amount available for investment under the Policy at any
time. It is equal to the sum of (a) the value of the Accumulation Units credited
to the Policy in the Sub-Accounts, and (b) the accumulation in the General
Account credited to the Policy.

POLICYOWNER: The person, persons or entity entitled to exercise the rights and
privileges under the Policy.

PREMIUM CLASS: The risk classification that the Company assigns the Insureds
based on the information in the application and any other Evidence of
Insurability considered by the Company. The Insureds' Premium Class will affect
the cost of insurance charge and the amount of premium required to keep the
Policy in force.

PRINCIPAL OFFICE: The Company's office, located at 440 Lincoln Street,
Worcester, Massachusetts 01653.

5
<PAGE>
PRO-RATA ALLOCATION: In certain circumstances, the Policyowner may specify from
which Sub-Account certain deductions will be made or to which Sub-Account Policy
Value will be allocated. If you do not, the Company will allocate the deduction
or Policy Value among the General Account and the Sub-Accounts in the same
proportion that the Policy Value in the General Account and the Policy Value in
each Sub-Account bear to the total Policy Value on the date of deduction or
allocation.

SEPARATE ACCOUNT: A separate account consists of assets segregated from the
Company's other assets. The investment performance of the assets of a separate
account is determined separately from the other assets of the Company. The
assets of a separate account which are equal to the reserves and other policy
liabilities are not chargeable with liabilities arising out of any other
business which the Company may conduct.

SUB-ACCOUNT: A division of the Separate Account. Each Sub-Account invests
exclusively in the shares of a corresponding Fund of the Allmerica Investment
Trust, a corresponding Portfolio of the Fidelity Variable Insurance Products
Fund, or the T. Rowe Price International Series, Inc.

SURRENDER VALUE: The amount payable upon a full surrender of the Policy. It is
the Policy Value less any Debt and applicable surrender charges.

UNDERLYING FUNDS ("FUNDS"): The Funds of Allmerica Investment Trust ("Trust"):,
the Portfolios of the Fidelity Variable Insurance Products Fund ("Fidelity
VIP"), and T. Rowe Price International Series ("T. Rowe Price"), available under
the Policy.

VALUATION DATE: A day on which the net asset value of the shares of any of the
Underlying Funds is determined and Accumulation Unit values of the Sub-Accounts
are determined. Valuation Dates currently occur on each day on which the New
York Stock Exchange is open for trading, and on such other days (other than a
day during which no payment, partial withdrawal or surrender of a Policy is
received) when there is a sufficient degree of trading in an Underlying Fund's
securities such that the current net asset value of the Sub-Accounts may be
materially affected.

WRITTEN REQUEST: A request by the Policyowner in writing, satisfactory to the
Company.

YOU OR YOUR: The Policyowner, as shown in the application or the latest change
filed with the Company.

6
<PAGE>
SUMMARY OF FEES AND CHARGES

POLICY FEES AND CHARGES

THERE ARE COSTS RELATED TO THE INSURANCE AND INVESTMENT FEATURES OF THE POLICY.
FEES AND CHARGES TO COVER THESE COSTS ARE DEDUCTED IN SEVERAL WAYS.

TAX EXPENSE CHARGE

PREMIUM EXPENSE CHARGE

MONTHLY DEDUCTIONS FROM POLICY VALUE

As noted above, certain ADDITIONAL INSURANCE RIDER BENEFITS are available under
the Policy for an additional monthly charge. See APPENDIX A -- OPTIONAL
BENEFITS.

DEDUCTIONS FROM THE SEPARATE ACCOUNT

A daily charge, currently equivalent to an effective annual rate of 1.15% of the
average daily net asset value of each Sub-Account of the Separate Account, is
imposed to compensate the Company for its assumption of certain mortality and
expense risks and for administrative costs associated with the Separate Account.
The rate is 0.90% for the mortality and expense risk and 0.25% for the Separate
Account administrative charge. The administrative charge is eliminated after the
15th Policy year. See CHARGES AND DEDUCTIONS -- "Charges Against Assets of the
Separate Account."

7
<PAGE>
CHARGES OF THE UNDERLYING FUNDS

<TABLE>
<CAPTION>
TOTAL FUND
MANAGEMENT FEE OTHER EXPENSES EXPENSES
(AFTER ANY VOLUNTARY (AFTER ANY APPLICABLE (AFTER ANY WAIVERS/
UNDERLYING FUND WAIVERS) REIMBURSEMENTS) REIMBURSEMENTS)
- --------------- -------------------- --------------------- -------------------
<S> <C> <C> <C>
Select Emerging Markets Fund............. 1.35% 0.57% 1.92%(1)(2)
Select International Equity Fund......... 0.89% 0.13% 1.02%(1)(2)
T. Rowe Price International Stock
Portfolio............................... 1.05% 0.00% 1.05%
Select Aggressive Growth Fund............ 0.81%* 0.06% 0.87%(1)(2)*
Select Capital Appreciation Fund......... 0.90%* 0.07% 0.97%(1)*
Select Value Opportunity Fund............ 0.90% 0.07% 0.97%(1)(2)
Select Growth Fund....................... 0.78% 0.05% 0.83%(1)(2)
Select Strategic Growth Fund............. 0.85% 0.35% 1.20%(1)(2)
Fidelity VIP Growth Portfolio............ 0.58% 0.08% 0.66%(3)
Select Growth and Income Fund............ 0.67% 0.07% 0.74%(1)(2)
Fidelity VIP Equity-Income Portfolio..... 0.48% 0.09% 0.57%(3)
Fidelity VIP High Income Portfolio....... 0.58% 0.11% 0.69%
Select Income Fund....................... 0.52% 0.09% 0.61%(1)
Money Market Fund........................ 0.24% 0.05% 0.29%(1)
</TABLE>

(1) Until further notice, Allmerica Financial Investment Management
Services, Inc. ("AFIMS") has declared a voluntary expense limitation of 1.50% of
average net assets for Select International Equity Fund, 1.35% for Select
Aggressive Growth Fund and Select Capital Appreciation Fund, 1.25% for Select
Value Opportunity Fund, 1.20% for Select Growth Fund, 1.10% for Select Growth
and Income Fund, 1.00% for Select Income Fund, and 0.60% for Money Market Fund.
The total operating expenses of these Funds of the Trust were less than their
respective expense limitations throughout 1999.

(2) These Funds have entered into agreements with brokers whereby the brokers
rebate a portion of commissions. These amounts have been treated as reductions
of expenses. Including these reductions, total annual fund operating expenses
were 1.01% for Select International Equity Fund, 1.88% for Select Emerging
Markets, 0.84% for Select Aggressive Growth Fund, 0.88% for Select Value
Opportunity Fund, 0.81% for Select Growth Fund, 1.17% for Select Strategic
Growth Fund, and 0.73% for Select Growth and Income Fund.

8
<PAGE>
of certain funds', custodian credits realized as a result of uninvested cash
balances were used to reduce a portion of the fund's expenses. Including these
reductions, total operating expenses presented in the table would have been
0.56% for the Fidelity VIP Equity-Income Portfolio and 0.65% for the Fidelity
VIP Growth Portfolio.

The Underlying Fund information above was provided by the Underlying Funds and
was not independently verified by the Company.

OTHER CHARGES (NON-PERIODIC)

TRANSACTION CHARGE ON PARTIAL WITHDRAWALS

A transaction charge is assessed at the time of each partial withdrawal to
reimburse the Company for the cost of processing the withdrawal. The transaction
charge is the smaller of 2% of the amount withdrawn, or $25. In addition to the
transaction charge, a partial withdrawal charge also may be made under certain
circumstances. See CHARGES AND DEDUCTIONS -- "Charges on Partial Withdrawals."
The transaction fee applies to all partial withdrawals including a Withdrawal
without a surrender charge.

CHARGE FOR INCREASE IN FACE AMOUNT

For each increase in the Face Amount, a charge of $40 will be deducted from the
Policy Value. This charge is designed to reimburse the Company for underwriting
and administrative costs associated with the increase. See THE POLICY -- "Change
in Face Amount" and CHARGES AND DEDUCTIONS -- "Charge for Increase in Face
Amount."

TRANSFER CHARGE

The first 12 transfers of Policy Value in a Policy year will be free of charge.
Thereafter, with certain exceptions, a transfer charge of $10 will be imposed
for each transfer request to reimburse the Company for the costs of processing
the transfer. See THE POLICY -- "Transfer Privilege" and CHARGES AND
DEDUCTIONS -- "Transfer Charges."

SURRENDER CHARGES

At any time that the Policy is in effect, a Policyowner may elect to surrender
the Policy and receive its Surrender Value. A surrender charge is calculated
upon issuance of the Policy and upon each increase in the Face Amount. The
duration of the surrender charge is 15 years. The surrender charge is imposed
only if, during its duration, you request a full surrender of the Policy or a
decrease in the Face Amount.

SURRENDER CHARGE ON THE INITIAL FACE AMOUNT

The maximum surrender charge calculated upon issuance of the Policy is equal to
the sum of (a) plus (b) where (a) is a deferred administrative charge equal to
$8.50 per thousand dollars of the initial Face Amount, and (b) is a deferred
sales charge of 48% of premiums received up to a maximum number of Guideline
Annual Premiums subject to the deferred sales charge. Such deferred sales charge
varies by average issue Age from 1.95 (for average issue Ages 5 through 75) to
1.31 (for average issue Age 82). In accordance with limitations under state
insurance regulations, the amount of the maximum surrender charge will not
exceed a specified amount per $1,000 of the initial Face Amount, as indicated in
APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES.

9
<PAGE>

The maximum surrender charge initially remains level for 40 months, declines by
one-half of one percent of the initial amount for 80 months, and then declines
by one percent each month thereafter, reaching zero at the end of the 180 Policy
months (15 Policy years), as described in APPENDIX D -- CALCULATION OF MAXIMUM
SURRENDER CHARGES. If you surrender the Policy during the first two Policy years
following the Date of Issue, before making premium payments associated with the
initial Face Amount which are at least equal to one Guideline Annual Premium,
the deferred administrative charge will be $8.50 per thousand dollars of the
initial Face Amount, but the deferred sales charge will not exceed 25% of
premiums received. See THE POLICY -- "Policy Surrender," and CHARGES AND
DEDUCTIONS -- "Surrender Charge."

SURRENDER CHARGES FOR INCREASES IN FACE AMOUNT

A separate surrender charge will apply to, and is calculated for, each increase
in the Face Amount. The maximum surrender charge for the increase is equal to
the sum of (a) plus (b) where (a) is equal to $8.50 per thousand dollars of
increase, and (b) is a deferred sales charge of 48% of premiums associated with
the increase, up to a maximum number of Guideline Annual Premiums (for the
increase) subject to the deferred sales charge. Such deferred sales charge
varies by average Age (at the time of increase) from 1.95 (for average Ages 5
through 75) to 1.31 (for average Age 82). In accordance with limitations under
state insurance regulations, the amount of the surrender charge will not exceed
a specified amount per $1,000 of increase, as indicated in APPENDIX D --
CALCULATION OF MAXIMUM SURRENDER CHARGES.

As is true for the initial Face Amount, (a) is a deferred administrative charge,
and (b) is a deferred sales charge. The maximum surrender charge initially
remains level for 40 months, declines by one-half of one percent of the initial
amount for 80 months, and then declines by one percent each month thereafter,
reaching zero at the end of the 180 Policy months (15 Policy years), as
described in APPENDIX D -- CALCULATION OF MAXIMUM SURRENDER CHARGES. If you
surrender the Policy during the first two Policy years following an increase in
the Face Amount before making premium payments associated with the increase in
the Face Amount which are at least equal to one Guideline Annual Premium, the
deferred administrative charge will be $8.50 per thousand dollars of the Face
Amount increase, but the deferred sales charge will not exceed 25% of premiums
associated with the increase.

SURRENDER CHARGES ON DECREASES IN FACE AMOUNT

10
<PAGE>
SUMMARY OF POLICY FEATURES

There is no guaranteed minimum Policy Value. The value of a Policy will vary up
or down to reflect the investment experience of allocations to the Sub-Accounts
and the fixed rates of interest earned by allocations to the General Account.
The Policy Value will also be adjusted for other factors, including the amount
of charges imposed. The Policy will remain in effect so long as the Policy
Value, less any surrender charges and less any outstanding Debt, is sufficient
to pay certain monthly charges imposed in connection with the Policy. The Policy
Value may decrease to the point where the Policy will lapse and provide no
further death benefit without additional premium payments, unless the optional
Guaranteed Death Benefit Rider is in effect. This Rider may not be available in
all states.

If the Policy is in effect at the death of the last surviving Insured, the
Company will pay a death benefit (the "Death Proceeds") to the Beneficiary.
Prior to the Final Premium Payment Date, the Death Proceeds equal the Sum
Insured, less any Debt, partial withdrawals, and any due and unpaid charges. The
Policyowner may choose either Sum Insured Option 1 (the Sum Insured is fixed in
amount) or Sum Insured Option 2 (the Sum Insured includes the Policy Value in
addition to a fixed insurance amount). A Policyowner has the right to change the
Sum Insured option, subject to certain conditions. A Guideline Minimum Sum
Insured, equivalent to a percentage of the Policy Value, will apply if greater
than the Sum Insured otherwise payable under Option 1 or Option 2.

No claim is made that the Policy is in any way similar or comparable to a
systematic investment plan of a mutual fund.

ABOUT THE POLICY

The Policy allows you to make premium payments in any amount and frequency,
subject to certain limitations. As long as the Policy remains in force, it will
provide for:

- life insurance coverage on the named Insureds,

- Policy Value,

- surrender rights and partial withdrawal rights,

- loan privileges, and

- in some cases, additional insurance benefits available by rider for an
additional charge.

11
<PAGE>
LIFE INSURANCE

The Policy is a life insurance contract with death benefits, Policy Value, and
other features traditionally associated with life insurance. The Policy is a
"joint survivorship" policy because Death Proceeds are payable, not on the death
of the first Insured to die, but on the death of the last surviving Insured. The
Policy is "variable" because the Policy Value will increase or decrease
depending on the investment experience of the Sub-Accounts of the Separate
Account. Under some circumstances, the death benefit may vary with the
investment experience of the Sub-Accounts.

CONDITIONAL INSURANCE AGREEMENT

If at the time of application you make a payment equal to at least one Minimum
Monthly Factor for the Policy as applied for, the Company will provide
conditional insurance equal to the amount of insurance applied for, subject to
the terms of the Conditional Insurance Agreement. If you do not wish to make any
payment at the time of application, insurance coverage will not be in force
until delivery of the Policy and payment of sufficient premium to place the
insurance in force.

If any premiums are paid prior to the issuance of the Policy, such premiums will
be held in the General Account. If your application is approved and the Policy
is issued and accepted, the initial premiums held in the General Account will be
credited with interest at a specified rate beginning not later than the date of
receipt of the premiums at the Principal Office. IF THE POLICY IS NOT ISSUED AND
ACCEPTED, THE INITIAL PREMIUMS WILL BE RETURNED TO YOU WITHOUT INTEREST.

ALLOCATION OF INITIAL PREMIUMS

Net premiums may be allocated to one or more Sub-Accounts of the Separate
Account, to the General Account, or to any combination of Accounts. You bear the
investment risks of amounts allocated to the Sub-Accounts. Allocations may be
made to no more than 20 Sub-Accounts at any one time. The minimum allocation is
1% of Net Premium. All allocations must be in whole numbers and must total 100%.
See THE POLICY -- "Allocation of Net Premiums." Premiums allocated to the
General Account will earn a fixed rate of interest. Net premiums and minimum
interest are guaranteed by the Company. For more information, see MORE
INFORMATION ABOUT THE GENERAL ACCOUNT.

- 45 days after the applications for the Policy are signed,

- 10 days after you receive the Policy (or, if required by state law, the
longer period indicated in the Policy), or

- 10 days after the Company mails or personally delivers a Notice of
Withdrawal Rights to you.

When you return the Policy, the Company will mail a refund to you within seven
days. The refund of any premium paid by check may be delayed until the check has
cleared your bank.

Where required by state law, the refund will equal the premiums paid. In other
states, the refund will equal the sum of:

(1) the difference between the premium, including fees and charges paid, and
any amount allocated the Separate Account, PLUS

(2) the value of the amounts allocated to the Separate Account, PLUS

(3) any fees or charges imposed on the amounts allocated to the Separate
Account.

The amount refunded in (1) above includes any premiums allocated to the General
Account. A free-look privilege also applies after a requested increase in the
Face Amount. See THE POLICY -- "Free-Look Period."

12
<PAGE>
CONVERSION PRIVILEGES

During the first 24 Policy months after the Date of Issue, subject to certain
restrictions, you may convert the Policy to a fixed flexible premium adjustable
life insurance policy by simultaneously transferring all accumulated value in
the Sub-Accounts to the General Account and instructing the Company to allocate
all future premiums to the General Account. A similar conversion privilege is in
effect for 24 Policy months after the date of an increase in the Face Amount.
Where required by state law, and at your request, the Company will issue a
flexible premium adjustable life insurance policy to you. The new policy will
have the same Face Amount, issue Age, Date of Issue, and Premium Class as the
original Policy. See THE POLICY -- "Conversion Privileges."

FLEXIBLE PREMIUM

The Policy will remain in force until the Surrender Value is insufficient to
cover the next Monthly Deduction and loan interest accrued, if any, and a grace
period of 62 days has expired without adequate payment being made by you. During
the first 48 Policy months after the Date of Issue or the effective date of an
increase in the Face Amount, the Policy will not lapse if the total premiums
paid less the Debt, partial withdrawals and withdrawal charges are equal to or
exceed the sum of the Minimum Monthly Factor for the number of months the
Policy, increase in the Face Amount, or a Policy Change which causes a change in
the Minimum Monthly Factor, has been in force. Even during these periods,
however, making payments at least equal to the Minimum Monthly Factor will not
prevent the Policy from lapsing if the Debt equals or exceeds the Policy Value
less surrender charges.

MINIMUM MONTHLY FACTOR

- Debt does not exceed Policy Value less surrender charges, then

- the Policy is guaranteed not to lapse during that period.

EXCEPT FOR THE 48 POLICY MONTH PERIODS, MAKING MONTHLY PAYMENTS AT LEAST EQUAL
TO THE MINIMUM MONTHLY FACTOR DOES NOT GUARANTEE THAT THE POLICY WILL REMAIN IN
FORCE.

GUARANTEED DEATH BENEFIT RIDER (MAY NOT BE AVAILABLE IN ALL STATES)

This Rider, WHICH IS AVAILABLE ONLY AT DATE OF ISSUE:

- guarantees that the Policy will not lapse regardless of the investment
performance of the Separate Account; and

- provides a guaranteed death benefit.

13
<PAGE>
In order to maintain the Rider, certain minimum premium payment tests must be
met on each Policy anniversary and within 48 months following the Date of Issue
and/or the date of any increase in the Face Amount. In addition, a one-time
administrative charge of $25 will be deducted from the Policy Value when the
Rider is elected. Certain transactions, including Policy loans, partial
withdrawals, and changes in the Death Benefit Options, can result in the
termination of the Rider. If this Rider is terminated, it cannot be reinstated.

PARTIAL WITHDRAWALS

After the first Policy year, you may make partial withdrawals from the Policy
Value in a minimum amount of $500. Under Option 1, the Face Amount is reduced by
the amount of the partial withdrawal. A partial withdrawal will not be allowed
under Option 1 if it would reduce the Face Amount below $100,000.

A transaction charge, which is described in CHARGES AND DEDUCTIONS -- "Charges
on Partial Withdrawals," will be assessed to reimburse the Company for the cost
of processing each partial withdrawal. A partial withdrawal charge also may be
imposed upon a partial withdrawal. Generally, amounts withdrawn during each
Policy year in excess of 10% of the Policy Value ("excess withdrawal") are
subject to the partial withdrawal charge. The partial withdrawal charge is equal
to 5% of the excess withdrawal up to the surrender charge on the date of
withdrawal. If no surrender charge is applicable at the time of withdrawal, no
partial withdrawal charge will be deducted. The Policy's outstanding surrender
charge will be reduced by the amount of the partial withdrawal charge deducted.
See THE POLICY -- "Partial Withdrawals" and CHARGES AND DEDUCTIONS -- "Charges
on Partial Withdrawals."

LOAN PRIVILEGE

Policy loans will be allocated among the General Account and the Sub-Accounts in
accordance with your instructions. If no allocation is made by you, the Company
will make a Pro-Rata Allocation among the Accounts. In either case, Policy Value
equal to the Policy loan will be transferred from the appropriate Sub-
Account(s) to the General Account, and will earn monthly interest at an
effective annual rate of at least 6%. Therefore, a Policy loan may have a
permanent impact on the Policy Value even though it eventually is repaid.
Although the loan amount is a part of the Policy Value, the Death Proceeds will
be reduced by the amount of outstanding Debt at the time of death.

PREFERRED LOAN OPTION

There is some uncertainty as to the tax treatment of a preferred loan, which may
be treated as a taxable withdrawal from the Policy. See FEDERAL TAX
CONSIDERATIONS, "Policy Loans. Consult a qualified

14
<PAGE>
tax adviser (and see FEDERAL TAX CONSIDERATIONS). THE PREFERRED LOAN OPTION MAY
NOT BE AVAILABLE IN ALL STATES.

POLICY LAPSE AND REINSTATEMENT

Except as otherwise provided in the optional Guaranteed Death Benefit Rider, the
failure to make premium payments will not cause the Policy to lapse unless:

(a) the Surrender Value is insufficient to cover the next Monthly Deduction
plus loan interest accrued, if any; or

(b) Debt exceeds Policy Value less surrender charges.

A 62-day grace period applies to each situation.

- the sum of the payments you have made, MINUS any Debt, withdrawals and
withdrawal charges, and

- the amount of the Minimum Monthly Factor (the amount is shown on page 5 of
the Policy) MULTIPLIED by the number of months the Policy has been in
force, or the number of months which have elapsed since the last increase
in the Face Amount.

The Company then compares the first amount to the second amount. The Policy will
not enter the grace period if the first amount is greater than the second
amount. If the Policy lapses, it may be reinstated within three years of the
date of default (but not later than the Final Premium Payment Date). In order to
reinstate, you must pay the reinstatement premium and provide satisfactory
Evidence of Insurability subject to our then current underwriting standards. The
Company reserves the right to increase the Minimum Monthly Factor upon
reinstatement. See POLICY TERMINATION AND REINSTATEMENT.

POLICY VALUE AND SURRENDER VALUE

The Policy Value is the total amount available for investment under the Policy
at any time. It is the sum of the value of all Accumulation Units in the
Sub-Accounts of the Separate Account and all accumulations in the General
Account credited to the Policy. The Policy Value reflects the amount and
frequency of Net Premiums paid, charges and deductions imposed under the Policy,
interest credited to accumulations in the General Account, investment
performance of the Sub-Account(s) to which Policy Value has been allocated, and
partial withdrawals. The Policy Value may be relevant to the computation of the
Death Proceeds. You bear the entire investment risk for amounts allocated to the
Separate Account. The Company does not guarantee a minimum Policy Value.

The Surrender Value will be the Policy Value less any Debt and applicable
surrender charges. The Surrender Value is relevant, for example, to the
continuation of the Policy and in the computation of the amounts available upon
partial withdrawals, Policy loans or surrender.

DEATH PROCEEDS

The Policy provides for the payment of certain Death Proceeds to the named
Beneficiary upon the death of the last surviving Insured. There are no Death
Proceeds payable on the death of the first Insured to die. Prior to the

15
<PAGE>
Final Premium Payment Date, the Death Proceeds will be equal to the Sum Insured,
reduced by any outstanding Debt, partial withdrawals, partial withdrawal
charges, and any Monthly Deductions due and not yet deducted through the Policy
month in which the last surviving Insured dies.

FLEXIBILITY TO ADJUST SUM INSURED

Subject to certain limitations, you may adjust the Sum Insured, and thus the
Death Proceeds, at any time prior to the Final Premium Payment Date, by
increasing or decreasing the Face Amount. Any change in the Face Amount will
affect the monthly cost of insurance charges and the amount of the surrender
charge. If the Face Amount is decreased, a pro-rata surrender charge may be
imposed. The Policy Value is reduced by the amount of the charge. See THE
POLICY -- "Change In Face Amount." The minimum increase in the Face Amount is
$10,000, and any increase also may require additional Evidence of Insurability.
The increase is subject to a "free-look period" and, during the first 24 months
after the increase, to a conversion privilege. See THE POLICY -- "Free-Look
Period" and "Conversion Privileges."

ADDITIONAL INSURANCE BENEFITS

You have the flexibility to add additional insurance benefits by rider. These
include the Split Option Rider, Other Insured Rider, Guaranteed Death Benefit
Rider, and Four-Year Term Rider. See APPENDIX A -- OPTIONAL BENEFITS. (All
riders may not be available in all states.)

The cost of these optional insurance benefits will be deducted from the Policy
Value as part of the Monthly Deduction. See CHARGES AND DEDUCTIONS -- "Monthly
Deduction from Policy Value."

PAID-UP INSURANCE OPTION

The Policyowner who elects this option will have, without further premiums due,
joint survivorship insurance coverage for the lifetime of the Insureds, with the
Death Proceeds payable on the death of the last surviving Insured. The
Policyowner who has elected the Paid-Up Insurance option may not pay additional
premiums, select Sum Insured Option 2, increase or decrease the Face Amount, or
make partial withdrawals. Policy Value in the Separate Account will be
transferred to the General Account on the date the Company receives Written
Request to exercise the option, and transfers of Policy Value back to the
Separate Account will not be permitted. Riders will continue only with the
consent of the Company. Surrender Value and Loan Value are calculated
differently. See THE POLICY -- "Paid-Up Insurance Option." This option may not
be available in all states.

INVESTMENT OPTIONS

BARRA RogersCasey, Inc. ("BARRA RogersCasey"), a pension consulting firm,
assists the Company in the selection of the Policy's Funds. In addition, BARRA
RogersCasey assists the Trust in the selection of investment advisers for the
Funds of the Trust. BARRA RogersCasey provides consulting services to pension
plans representing hundreds of billions of dollars in total assets and, in its
consulting capacity, monitors the investment performance of over 1000 investment
advisers. BARRA RogersCasey is wholly-controlled by BARRA, Inc. As a consultant,
BARRA RogersCasey has no decision-making authority with respect to the Funds,
and is not responsible for any advice provided by Allmerica Financial Investment
Management Services, Inc. ("AFIMS") or the investment advisers.

16
<PAGE>
Each investment adviser is selected by using strict objective, quantitative, and
qualitative criteria, with special emphasis on the investment adviser's record
in managing similar portfolios. In consultation with BARRA RogersCasey, a
committee monitors and evaluates the ongoing performance of all of the Funds.
The committee may recommend the replacement of an investment adviser of one of
the Funds of the Trust, or the addition or deletion of Funds. The committee
includes members who may be affiliated or unaffiliated with the Company and the
Trust.

AFIMS, an affiliate of the Company, is the investment manager of the Trust.
AFIMS has entered into agreements with investment advisers ("Sub-Advisers")
selected by AFIMS and the Trustees in consultation with BARRA RogersCasey. Each
investment adviser is selected by using strict objective, quantitative, and
qualitative criteria, with special emphasis on the investment adviser's record
in managing similar portfolios. In consultation with BARRA RogersCasey, a
committee monitors and evaluates the ongoing performance of all of the Funds.
The committee may recommend the replacement of an investment adviser of one of
the Funds of the Trust, or the addition or deletion of Funds. The committee
includes members who may be affiliated or unaffiliated with the Company and the
Trust. The Sub-Advisers (other than Allmerica Asset Management, Inc.) are not
affiliated with the Company or the Trust.

The following are the Investment Managers and Sub-Advisers of the Funds:

<TABLE>
<CAPTION>
FUND MANAGER
- ---- -------
<S> <C>
Select Emerging Markets Fund Schroder Investment Management North America Inc.
Select International Equity Fund Bank of Ireland Asset Management (U.S.) Limited
T. Rowe Price International Stock Portfolio Rowe Price-Fleming International, Inc.
Select Aggressive Growth Fund Nicholas-Applegate Capital Management, L.P.
Select Capital Appreciation Fund T. Rowe Price Associates, Inc.
Select Value Opportunity Fund Cramer Rosenthal McGlynn, LLC
Select Growth Fund Putnam Investment Management, Inc.
Select Strategic Growth Fund TCW Investment Management Company
Fidelity VIP Growth Portfolio Fidelity Management and Research Company
Select Growth and Income Fund J. P. Morgan Investment Management Inc.
Fidelity VIP Equity-Income Portfolio Fidelity Management and Research Company
Fidelity VIP High Income Portfolio Fidelity Management and Research Company
Select Income Fund Standish, Ayer & Wood, Inc.
Money Market Fund Allmerica Asset Management, Inc.
</TABLE>

In some states, insurance regulations may restrict the availability of
particular Underlying Funds.

TAX TREATMENT

The Policy is generally subject to the same federal income tax treatment as a
conventional fixed benefit life insurance policy. Under current tax law, to the
extent there is no change in benefits, you will be taxed on Policy Value
withdrawn from the Policy only to the extent that the amount withdrawn exceeds
the total premiums paid. Withdrawals in excess of premiums paid will be treated
as ordinary income. During the first 15 Policy years, however, an
"interest-first" rule applies to any distribution of cash that is required under
Section 7702 of the Code because of a reduction of benefits under the Policy.
Death Proceeds under the Policy are excludable from the gross income of the
Beneficiary, but in some circumstances the Death Proceeds or the Policy Value
may be subject to federal estate tax. See FEDERAL TAX CONSIDERATIONS --
"Taxation of the Policies."

The Policy offered by this Prospectus may be considered a "modified endowment
contract" if it fails a "seven-pay" test at any time during the first seven
Policy years, or within seven years of a material change in the Policy. The
Policy fails to satisfy the seven-pay test if the cumulative premiums paid under
the Policy at any time during the first seven Policy years, or within seven
years of a material change in the Policy, exceeds

17
<PAGE>
the sum of the net level premiums that would have been paid had the Policy
provided for paid-up future benefits after the payment of seven level annual
premiums. If the Policy is considered a modified endowment contract, all
distributions (including Policy loans, partial withdrawals, surrenders or
assignments) will be taxed on an "income-first" basis. In addition, with certain
exceptions, an additional 10% penalty will be imposed on the portion of any
distribution that is includible in income. For more information, see FEDERAL TAX
CONSIDERATIONS -- "Modified Endowment Contracts."
------------------------

NO CLAIM IS MADE THAT THE POLICY IS IN ANY WAY SIMILAR OR COMPARABLE TO A
SYSTEMATIC INVESTMENT PLAN OF A MUTUAL FUND.

18
<PAGE>
DESCRIPTION OF THE COMPANY, THE SEPARATE ACCOUNT,
AND THE UNDERLYING FUNDS

THE COMPANY

The Company is a life insurance company organized under the laws of Delaware in
July 1974. Its Principal Office is located at 440 Lincoln Street, Worcester,
Massachusetts 01653, telephone 508-855-1000. As of December 31, 1999, the
Company had over $17 billion in assets and over $26 billion of life insurance in
force. The Company is subject to the laws of the state of Delaware governing
insurance companies and to regulation by the Commissioner of Insurance of
Delaware. In addition, the Company is subject to the insurance laws and
regulations of other states and jurisdictions in which it is licensed to
operate.

THE SEPARATE ACCOUNT

The assets used to fund the variable portion of the Policies are set aside in
the Separate Account and are kept separate from the general assets of the
Company. Under Delaware law, assets equal to the reserves and other liabilities
of the Separate Account may not be charged with any liabilities arising out of
any other business of the Company. Fourteen Sub-Accounts of the Separate Account
are currently offered under the Policy. Each Sub-Account is administered and
accounted for as part of the general business of the Company, but the income,
capital gains, or capital losses of each Sub-Account are allocated to such
Sub-Account, without regard to other income, capital gains, or capital losses of
the Company or the other Sub-Accounts. Each Sub-Account invests exclusively in a
corresponding investment portfolio of the Allmerica Investment Trust, the
Fidelity Variable Insurance Products Fund, or the T. Rowe Price International
Series, Inc. ("Underlying Funds").

The assets of each Underlying Fund are held separate from the assets of the
other Underlying Funds. Each Underlying Fund operates as a separate investment
vehicle and the income or losses of one Underlying Fund generally have no effect
on the investment performance of another Underlying Fund. Shares of each
Underlying Fund are not offered to the general public but solely to separate
accounts of life insurance companies, such as the Separate Account.

19
<PAGE>
Each Sub-Account has two sub-divisions. One sub-division applies to Policies
during their first 15 Policy years, which are subject to a Separate Account
administrative charge. See CHARGES AND DEDUCTIONS -- "Charges Against Assets of
the Separate Account." Thereafter, such Policies are automatically allocated to
the second sub-division to account for the elimination of the Separate Account
administrative charge.

The Company reserves the right, subject to compliance with applicable law, to
change the names of the Sub-Accounts and Separate Account.

THE UNDERLYING FUNDS

ALLMERICA INVESTMENT TRUST

Allmerica Investment Trust (the "Trust") is an open-end, diversified management
investment company registered with the SEC under the 1940 Act. Such registration
does not involve supervision by the SEC of the investments or investment policy
of the Trust or its separate investment Funds.

The Trust was established by the Company as a Massachusetts business trust on
October 11, 1984, for the purpose of providing a vehicle for the investment of
assets of various separate accounts established by the Company, or other
insurance companies. Ten investment portfolios ("Funds") of the Trust are
available under the Policies, each issuing a series of shares: Select Emerging
Markets Fund, Select International Equity Fund, Select Aggressive Growth Fund,
Select Capital Appreciation Fund, Select Value Opportunity Fund, Select Growth
Fund, Select Strategic Growth Fund, Select Growth and Income Fund, Select Income
Fund and Money Market Fund.

The Trust bears all expenses incurred in its operation, other than the expenses
AFIMS assumes under the management agreement. Trust expenses include:

- Costs to register and qualify the Trust's shares under the Securities Act
of 1933 ("1933 Act"),

- Other fees payable to the SEC,

- Independent public accountant, legal and custodian fees,

- Association membership dues, taxes, interest, insurance payments and
brokerage commissions,

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- Fees and expenses of the Trustees who are not affiliated with AFIMS,

- Expenses for proxies, prospectuses, reports to shareholders and other
expenses.

FIDELITY VARIABLE INSURANCE PRODUCTS FUND

Fidelity Variable Insurance Products Fund ("Fidelity VIP"), managed by Fidelity
Management & Research Company ("FMR"), is an open-end, diversified management
investment company organized as a Massachusetts business trust on November 13,
1981, and is registered with the SEC under the 1940 Act. Three of its investment
portfolios are available under the Policies: the Fidelity VIP High Income
Portfolio, Fidelity VIP Equity-Income Portfolio, and Fidelity VIP Growth
Portfolio.

T. ROWE PRICE INTERNATIONAL SERIES, INC.

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INVESTMENT OBJECTIVES AND POLICIES

A summary of investment objectives of the Funds is set forth below. BEFORE
INVESTING, READ CAREFULLY THE PROSPECTUSES OF THE TRUST, FIDELITY VIP AND T.
ROWE PRICE THAT ACCOMPANY THIS PROSPECTUS. THE PROSPECTUSES OF THE TRUST,
FIDELITY VIP AND T. ROWE PRICE CONTAIN MORE DETAILED INFORMATION ON THE FUNDS'
INVESTMENT OBJECTIVES, RESTRICTIONS, RISKS AND EXPENSES. Statements of
Additional Information for the Funds are available on request. The investment
objectives of the Funds may not be achieved. Policy Value may be less than the
aggregate payments made under the Policy.

SELECT EMERGING MARKETS FUND -- seeks long-term growth of capital by investing
in the world's emerging markets. The Sub-Adviser for the Select Emerging Markets
Fund is Schroder Investment Management North America Inc.

SELECT INTERNATIONAL EQUITY FUND -- seeks maximum long-term total return
(capital appreciation and income) primarily by investing in common stocks of
established non-U.S. companies. The Sub-Adviser for the Select International
Equity Fund is Bank of Ireland Asset Management (U.S.) Limited.

T. ROWE PRICE INTERNATIONAL STOCK PORTFOLIO -- seeks long-term growth of capital
through investments primarily in common stocks of established, non-U.S.
companies. The Manager of the Portfolio is Rowe Price-Fleming International,
Inc.

SELECT AGGRESSIVE GROWTH FUND -- seeks above-average capital appreciation by
investing primarily in common stocks of companies that are believed to have
significant potential for capital appreciation. The Sub-Adviser for the Select
Aggressive Growth Fund is Nicholas-Applegate Capital Management, L.P.

SELECT CAPITAL APPRECIATION FUND -- seeks long-term growth of capital.
Realization of income is not a significant investment consideration and any
income realized on the Fund's investments will be incidental to its primary
objective. The Fund will invest primarily in common stock of industries and
companies which are experiencing favorable demand for their products and
services, and which operate in a favorable competitive environment and
regulatory climate. The Sub-Adviser for the Select Capital Appreciation Fund is
T. Rowe Price Associates, Inc.

SELECT VALUE OPPORTUNITY FUND -- seeks long-term growth of capital by investing
primarily in a diversified portfolio of common stocks of small and mid-size
companies whose securities at the time of purchase are considered by the
Sub-Adviser to be undervalued. The Sub-Adviser for the Select Value Opportunity
Fund is Cramer Rosenthal McGlynn, LLC.

SELECT GROWTH FUND -- seeks to achieve growth of capital by investing in a
diversified portfolio consisting primarily of common stocks selected for their
long-term growth potential. The Sub-Adviser for the Select Growth Fund is Putnam
Investment Management, Inc.

SELECT STRATEGIC GROWTH FUND -- seeks long-term growth of capital by investing
primarily in common stocks of established companies. The Sub-Adviser for the
Select Strategic Growth Fund is Cambiar Investors, Inc.

SELECT GROWTH AND INCOME FUND -- seeks a combination of long-term growth of
capital and current income. The Fund will invest primarily in dividend-paying
common stocks and securities convertible into common stocks. The Sub-Adviser for
the Select Growth and Income Fund is J.P. Morgan Investment Management Inc.

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FIDELITY VIP EQUITY-INCOME PORTFOLIO -- seeks reasonable income by investing
primarily in income-producing equity securities. In choosing these securities,
the Portfolio also will consider the potential for capital appreciation. The
Portfolio's goal is to achieve a yield which exceeds the composite yield on the
securities comprising the S&P 500. The Portfolio may invest in high-yielding,
lower-rated securities (commonly referred to as "junk bonds") which are subject
to greater risk than investments in higher-rated securities. For a further
discussion of lower-rated securities, see "Risks of Lower-Rated Debt Securities"
in the Fidelity VIP prospectus.

FIDELITY VIP HIGH INCOME PORTFOLIO -- seeks to obtain a high level of current
income by investing primarily in high-yielding, lower-rated fixed-income
securities (commonly referred to as "junk bonds"), while also considering growth
of capital. These securities are often considered to be speculative, and involve
greater risk of default or price changes than securities assigned a high quality
rating. For more information about these lower-rated securities, see "Risks of
Lower-Rated Debt Securities" in the Fidelity VIP prospectus.

SELECT INCOME FUND -- seeks a high level of current income. The Fund will invest
primarily in investment-grade, fixed-income securities. The Sub-Adviser for the
Select Income Fund is Standish, Ayer & Wood, Inc.

MONEY MARKET FUND -- seeks to obtain maximum current income consistent with the
preservation of capital and liquidity. Allmerica Asset Management, Inc. is the
Sub-Adviser of the Money Market Fund.

If there is a material change in the investment policy of a Fund, we will notify
you of the change. If you have Policy Value allocated to that Fund, you may,
without charge, reallocate the Policy Value to another Fund or to the General
Account. We must receive your Written Request within 60 days of the latest of
the:

- Effective date of the change in the investment policy, or

- Receipt of the notice of your right to transfer.

SUBSTITUTION OF SHARES OF THE SELECT INCOME FUND

On January 31, 2000, the Company, First Allmerica (collectively, the
"Companies") and several other applicants filed an application with the
Securities and Exchange Commission in part seeking an order approving the
substitution of shares of the Select Investment Grade Income Fund of Allmerica
Investment Trust for shares of the Select Income Fund. To the extent required by
law, approvals of such substitutions will also be obtained from the state
insurance regulators in certain jurisdictions. The Companies will bear any
expenses in connection with the proposed substitution. Although subject to
change and obtaining necessary regulatory approvals, the Companies are currently
planning to effect the substitution on or about July 1, 2000.

The Select Investment Grade Income Fund seeks as high a level of total return,
which includes capital appreciation as well as income, as is consistent with
prudent investment management. Allmerica Asset Management, Inc. is the
Sub-Adviser of the Select Investment Grade Income Fund. For more information
about the Select Investment Grade Income Fund, see the prospectus of the Trust.

Under the proposed substitution, during the period from February 14, 2000 until
the date the Select Income Fund is replaced by the Select Investment Grade
Income Fund, a Policy owner with value in the Sub-Account investing in the
Select Income Fund may make one transfer of all amounts in that Sub-Account to
and among any of the other Sub-Accounts and the Fixed Account. This transfer of
all amounts from the Sub-Account investing in the Select Income Fund prior to
the substitution date will be free of any transfer charge and will not count as
one of the twelve transfers guaranteed to be free of the transfer charge in each
Policy year. In addition, on the date the proposed substitution is completed, a
Policy Owner that has amounts invested in the Select Investment Grade Income
Fund as a result of the substitution will have a period of 60 days to make one
transfer of all amounts allocated to the Sub-Account investing in the Select
Investment Grade Income Fund to any one or more of the investment options
available under the Policy. This transfer will be free of any transfer

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charge and will not count as one of the twelve transfers guaranteed to be free
of the transfer charge in that Policy year. All Policy owners with value in the
affected Sub-Account on the date the substitution is made will receive written
notice that the substitution has been completed.

The terms and conditions of the proposed substitution are subject to change. In
particular, the terms and conditions of any SEC exemption order, if and when
granted, may require changes in the proposed substitution.

ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS

The Company reserves the right, subject to applicable law, to make additions to,
deletions from, or substitutions for the shares that are held in the
Sub-Accounts or that the Sub-Accounts may purchase. If the shares of any
Underlying Fund are no longer available for investment or if, in the Company's
judgment, further investment in any Underlying Fund should become inappropriate
in view of the purposes of the Separate Account or the affected Sub-Account, the
Company may redeem the shares of that Underlying Fund and substitute shares of
another registered open-end management company. The Company will not substitute
any shares attributable to the Policy interest in a Sub-Account without notice
to you and prior approval of the SEC and state insurance authorities, to the
extent required by the 1940 Act or other applicable law. The Separate Account
may, to the extent permitted by law, purchase other securities for other
policies or permit a conversion between policies upon request by a Policyowner.

Shares of the Funds of the Trust are also issued to separate accounts of the
Company and its affiliates which issue variable annuity contracts ("mixed
funding"). Shares of the Portfolios of Fidelity VIP and of T. Rowe Price are
also issued to other unaffiliated insurance companies ("shared funding"). It is
conceivable that in the future such mixed funding or shared funding may be
disadvantageous for variable life Policyowners or variable annuity Policyowners.
Although the Company and the Underlying Funds do not currently foresee any such
disadvantages, the Company and the respective Trustees intend to monitor events
in order to identify any material conflicts and to determine what action, if
any, should be taken. If the Trustees were to conclude that separate funds
should be established for variable life and variable annuity separate accounts,
the Company will bear the expenses.

If any of these substitutions or changes is made, the Company may, by
endorsement, change the Policy to reflect the substitution or change, and will
notify Policyowners of all such changes. If the Company deems it to be in the
best interest of Policyowners, and subject to any approvals that may be required
under applicable law, the Separate Account or any Sub-Account(s) may be operated
as a management company under the 1940 Act, may be deregistered under the 1940
Act if registration is no longer required, or may be combined with other
Sub-Accounts or other separate accounts of the Company.

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THE POLICY

APPLYING FOR THE POLICY

The Policy cannot be issued until the underwriting procedure has been completed.
Upon receipt at its Principal Office of a completed application from a
prospective Policyowner, the Company will follow certain insurance underwriting
procedures designed to determine whether the proposed Insureds are insurable.
This process may involve medical examinations, and may require that further
information be provided by the proposed Policyowner before a determination of
insurability can be made. The Company reserves the right to reject an
application which does not meet its underwriting guidelines, but in underwriting
insurance, the Company complies with all applicable federal and state
prohibitions concerning unfair discrimination.

CONDITIONAL INSURANCE AGREEMENT

It is possible to obtain life insurance protection during the underwriting
process through a Conditional Insurance Agreement. If at the time of application
you make a payment equal to at least one "Minimum Monthly Factor" for the Policy
as applied for, the Company will provide fixed conditional insurance in the
amount of insurance applied for, subject to the terms of the Conditional
Insurance Agreement. This coverage generally will continue for a maximum of 90
days from the date of the application or the completion of a medical exam,
should one be required. In no event will any insurance proceeds be paid under
the Conditional Insurance Agreement if death is by suicide.

PREMIUMS HELD IN THE GENERAL ACCOUNT PENDING UNDERWRITING APPROVAL

Pending completion of insurance underwriting and Policy issuance procedures, the
initial premium will be held in the Company's General Account. If the
application is approved and the Policy is issued and accepted by you, the
initial premium held in the General Account will be credited with interest at a
specified rate, beginning not later than the date of receipt of the premium at
the Company's Principal Office. IF THE POLICY IS NOT ISSUED, THE PREMIUMS WILL
BE RETURNED TO YOU WITHOUT INTEREST.

FREE-LOOK PERIOD

The Policy provides for an initial "free-look" period. You may cancel the Policy
by mailing or delivering the Policy to the Principal Office or an agent of the
Company on or before the latest of:

- 45 days after the application for the Policy is signed, or