File Nos. 33-79170
811-8524
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 3 [X]
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 4 [X]
(Check appropriate box or boxes.)
EQUITABLE LIFE INSURANCE COMPANY OF IOWA SEPARATE ACCOUNT A
___________________________________________________________
(Exact Name of Registrant)
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
________________________________________
(Name of Depositor)
604 Locust Street, Des Moines, Iowa 50309
____________________________________________________ __________
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (800) 344-6860
NAME AND ADDRESS OF AGENT FOR SERVICE
John A. Merriman, Assistant Secretary & General Counsel
Equitable Life Insurance Company of Iowa
604 Locust Street
Des Moines, Iowa 50309
(515) 245-6911
COPIES TO:
Judith A. Hasenauer and G. Thomas Sullivan
Blazzard, Grodd & Hasenauer, P.C. Nyemaster, Goode,
P.O. Box 5108 McLaughlin, Voigts,
Westport, CT 06881 West, Hansell & O'Brien
(203) 226-7866 699 Walnut Street
Des Moines, Iowa 50309
It is proposed that this filing will become effective:
_X_ immediately upon filing pursuant to paragraph (b) of Rule 485
___ on ________________ pursuant to paragraph (b) of Rule 485
___ 60 days after filing pursuant to paragraph (a)(1) of Rule 485
___ on (date) pursuant to paragraph (a)(1) of Rule 485
If appropriate, check the following:
___ This Post-Effective Amendment designates a new effective date for a
previously filed Post-Effective Amendment.
Registrant has declared that it has registered an indefinite number or amount
of securities in accordance with Rule 24f-2 under the Investment Company Act
of 1940. Registrant filed its Rule 24f-2 Notice for the fiscal year ended
December 31, 1994 on or about February 28, 1995.
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CROSS REFERENCE SHEET
(required by Rule 495)
Item No. Location
- -------- -------------------
PART A
Item 1. Cover Page................................. Cover Page
Item 2. Definitions................................ Definitions
Item 3. Synopsis................................... Highlights
Item 4. Condensed Financial Information............ Not Applicable
Item 5. General Description of Registrant,
Depositor, and Portfolio Companies......... The Company; The
Separate Account;
EquiSelect Series
Trust; Smith
Barney/Travelers
Series Fund Inc.;
Smith Barney Series
Fund
Item 6. Deductions and Expenses.................... Charges and
Deductions
Item 7. General Description of Variable
Annuity Contracts.......................... The Contracts
Item 8. Annuity Period............................. Annuity Provisions
Item 9. Death Benefit.............................. The Contracts;
Annuity
Provisions
Item 10. Purchases and Contract Value............... Purchase Payments
and Contract Value
Item 11. Redemptions................................ Withdrawals
Item 12. Taxes...................................... Tax Status
Item 13. Legal Proceedings.......................... Legal Proceedings
Item 14. Table of Contents of the Statement
of Additional Information.................. Table of Contents
of the Statement
of Additional
Information
</TABLE>
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CROSS REFERENCE SHEET (CONT'D)
(required by Rule 495)
Item No. Location
- -------- --------------------
PART B
Item 15. Cover Page................................. Cover Page
Item 16. Table of Contents.......................... Table of Contents
Item 17. General Information and History............ The Company
Item 18. Services................................... Not Applicable
Item 19. Purchase of Securities Being Offered....... Not Applicable
Item 20. Underwriters............................... Distributor
Item 21. Calculation of Performance Data............ Performance
Information
Item 22. Annuity Payments........................... Annuity Provisions
Item 23. Financial Statements....................... Financial Statements
</TABLE>
PART C
Information required to be included in Part C is set forth under the
appropriate Item so numbered in Part C to this Registration Statement.
EXPLANATORY NOTE
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This Registration Statement contains ten Portfolios of Equi-Select Series
Trust, four Portfolios of Smith Barney/Travelers Series Fund Inc. and four
Portfolios of Smith Barney Series Fund. Two versions of Prospectuses will be
created from this Registration Statement. The distribution system for each
version of the Prospectus is different. One version of the Prospectus will
contain the ten Portfolios of Equi-Select Series Trust (Version I). Currently,
the other version of the Prospectus will contain the Research, OTC and Total
Return Portfolios of Equi-Select Series Trust, the four Portfolios of Smith
Barney/Travelers Series Fund Inc. and the Appreciation Portfolio of Smith
Barney Series Fund (Version II). (Prior to the effective date of this
Registration Statement Version II contained the Research Portfolio of
Equi-Select Series Trust and the four Portfolios of Smith Barney/Travelers
Series Fund Inc.) These Prospectuses will be filed with the Commission
pursuant to Rule 497.
The Registrant undertakes to update this Explanatory Note each time a
Post-Effective Amendment is filed. The following Prospectuses were filed
pursuant to Rule 497 regarding this Registration Statement:
1. On February 14, 1995, a Prospectus was filed pursuant to Rule 497
which contained the ten Portfolios of Equi-Select Series Trust.
2. On February 14, 1995, a Prospectus was filed pursuant to Rule 497
which contained the Research Portfolio of Equi-Select Series Trust and the
four Portfolios of Smith Barney/Travelers Series Fund Inc.
3. On June 16, 1995, a Prospectus was filed pursuant to Rule 497 which
contained the ten Portfolios of Equi-Select Series Trust.
4. On June 14, 1995, a Prospectus was filed pursuant to Rule 497 which
contained the Research Portfolio of Equi-Select Series Trust and the four
Portfolios of Smith Barney/Travelers Series Fund Inc.
==============================================================================
PART A
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
EQUI-SELECT SERIES TRUST
SUPPLEMENT TO PROSPECTUSES
The following supersedes certain information appearing in the
Prospectuses dated May 1, 1995, of Equitable Life Insurance Company of Iowa
Separate Account A and Equi-Select Series Trust ("Trust"). Except as
otherwise provided herein, all capitalized terms have the meanings set forth
in the Prospectuses.
Effective as of April 1, 1996 the Subadvisory Agreement dated July 21,
1994 ("Subadvisory Agreement") between Equitable Investment Services, Inc.
("EISI"), the Trust's Investment Adviser, and Strong Capital Management, Inc.
("Strong") with respect to the Advantage, Government Securities, and
Short-Term Bond Portfolios will be terminated. In addition to the other
duties which it currently performs in its role as the investment adviser to
these Portfolios, EISI will assume the portfolio management functions for
these Portfolios on April 1, 1996. EISI has served as the investment adviser
to these Portfolios since their inception pursuant to the Investment Advisory
Agreement dated October 1, 1994, between the Trust and EISI.
Robert F. Bowman and Annette F. Shaw, portfolio managers of EISI, will
co-manage the Advantage, Government Securities and Short-Term Bond Portfolios
in addition to the portfolio management responsibilities they have held for
the Money Market Portfolio and Mortgage-Backed Securities Portfolio,
respectively, of the Trust since July 1, 1995. Mr. Bowman was graduated from
Wabash College with a Bachelor of Arts degree in Economics and from the
University of Texas with a Master of Business Administration degree in
Finance. Mr. Bowman currently holds the title of Managing Director at EISI.
Ms. Shaw was graduated from Drake University with a Bachelor of Science
degree in Finance. Ms. Shaw also holds the Chartered Financial Analyst
(CFA) designation. Ms. Shaw currently holds the title of Managing Director
at EISI.
Effective as of June 10, 1996, the Subadvisory Agreement with respect to
the International Stock Portfolio will be terminated. EISI is actively
seeking a successor subadviser for this Portfolio. Upon identification of the
successor subadviser, it is the intention of EISI to obtain approval of the
successor subadviser by the Trustees of the Trust, and also the approval of
the shareholder of the International Stock Portfolio. The sole shareholder of
the International Stock Portfolio is Equitable Life Insurance Company of Iowa
Separate Account A. Pursuant to current interpretations of the Investment
Company Act of 1940, Equitable Life Insurance Company of Iowa will solicit
voting instructions from owners of the variable annuity contracts invested in
the International Stock Subaccount. All shares of the International Stock
Portfolio of the Trust will be voted by Equitable Life Insurance Company of
Iowa in accordance with the voting instructions received from such contract
owners invested in the International Stock Subaccount.
The date of this Supplement is January 25, 1996.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
Home Office & Annuity Service Center: Mailing Address:
604 Locust Street P.O. Box 9271
Des Moines, Iowa 50309 Des Moines, Iowa 50306-9271
(800) 344-6864
INDIVIDUAL FLEXIBLE PURCHASE PAYMENT DEFERRED VARIABLE AND
FIXED ANNUITY CONTRACTS
ISSUED BY
EQUITABLE LIFE INSURANCE COMPANY OF IOWA SEPARATE ACCOUNT A
AND
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
The Individual Flexible Purchase Payment Deferred Variable and Fixed Annuity
Contracts (the "Contracts") described in this Prospectus provide for
accumulation of Contract Values on a fixed and variable basis and payment of
monthly annuity payments on a fixed basis. The Contracts are designed for use
by individuals in retirement plans on a Qualified or Non-Qualified basis.
(See "Definitions" on Page __.)
At the Owner's direction, Purchase Payments for the Contracts will be
allocated to a segregated investment account of Equitable Life Insurance
Company of Iowa (the "Company") which account has been designated Equitable
Life Insurance Company of Iowa Separate Account A (the "Separate Account") or
to the Company's Fixed Account. Under certain circumstances, however,
Purchase Payments may initially be allocated to the Money Market Subaccount of
the Separate Account. (See "Highlights" on Page __.) The Separate Account
invests in shares of the following Investment Options: Equi-Select Series
Trust (see "Equi-Select Series Trust" on Page __), Smith Barney/Travelers
Series Fund Inc. (see "Smith Barney/Travelers Series Fund Inc." on Page __)
and Smith Barney Series Fund (see "Smith Barney Series Fund" on Page __).
Equi-Select Series Trust is a series fund with ten Portfolios: Advantage
Portfolio, Government Securities Portfolio, International Fixed Income
Portfolio, International Stock Portfolio, Money Market Portfolio,
Mortgage-Backed Securities Portfolio, OTC Portfolio, Research Portfolio,
Short-Term Bond Portfolio and Total Return Portfolio. SHARES OF THE GOVERNMENT
SECURITIES PORTFOLIO AND THE SHORT-TERM BOND PORTFOLIO ARE NO LONGER OFFERED
FOR SALE. Smith Barney/Travelers Series Fund Inc. is a series fund with eleven
Portfolios, four of which are currently available in connection with the
Contracts: Smith Barney Income and Growth Portfolio, Smith Barney
International Equity Portfolio, Smith Barney High Income Portfolio and Smith
Barney Money Market Portfolio. Smith Barney Series Fund is a series fund with
ten Portfolios, four of which are currently available in connection with the
Contracts: Appreciation Portfolio, Equity Income Portfolio, Equity Index
Portfolio, and Intermediate High Grade Portfolio.
This Prospectus concisely sets forth the information a prospective investor
should know before investing. Additional information about the Contracts is
contained in the Statement of Additional Information which is available at no
charge. The Statement of Additional Information has been filed with the
Securities and Exchange Commission and is incorporated herein by reference.
The Table of Contents of the Statement of Additional Information can be found
on Page __ of this Prospectus. For the Statement of Additional Information,
call (800) 344-6864 or write to the Company at the address listed above.
THE CONTRACTS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY FINANCIAL INSTITUTION AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
INVESTMENT IN THE CONTRACTS IS SUBJECT TO RISK THAT MAY CAUSE THE VALUE OF THE
CONTRACT OWNER'S INVESTMENT TO FLUCTUATE, AND WHEN THE CONTRACTS ARE
SURRENDERED, THE VALUE MAY BE HIGHER OR LOWER THAN THE PURCHASE PAYMENTS.
INQUIRIES:
Any inquiries can be made by telephone or in writing to Equitable Life
Insurance Company of Iowa at (800) 344-6864 or P.O. Box 9271, Des Moines,
Iowa 50306-9271.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
This Prospectus and the Statement of Additional Information are dated
_____________, 1996.
This Prospectus should be kept for future reference.
TABLE OF CONTENTS
PAGE
DEFINITIONS
HIGHLIGHTS
TABLE
CONDENSED FINANCIAL INFORMATION
THE COMPANY
THE SEPARATE ACCOUNT
INVESTMENT OPTIONS
Equi-Select Series Trust
Smith Barney/Travelers Series Fund Inc.
Smith Barney Series Fund
Voting Rights
Substitution of Securities
CHARGES AND DEDUCTIONS
Deduction for Withdrawal Charge (Sales Load)
Reduction or Elimination of the Withdrawal Charge
Deduction for Mortality and Expense Risk Charge
Deduction for Administrative Charge
Deduction for Annual Contract Maintenance Charge
Deduction for Income Taxes
Deduction for Transfer Fee
THE CONTRACTS
Ownership
Annuitant
Assignment
Beneficiary
PURCHASE PAYMENTS AND CONTRACT VALUE
Purchase Payments
Allocation of Purchase Payments
Dollar Cost Averaging
Automatic Portfolio Rebalancing
Contract Value
Accumulation Unit
TRANSFERS
WITHDRAWALS
Automatic Withdrawals
Texas Optional Retirement Program
Suspension of Payments or Transfers
CONTRACT PROCEEDS
Maturity Proceeds
Death Proceeds
Death of the Annuitant
Death of Owner
Fixed Payment Plans
Plan A. Interest
Plan B. Fixed Period
Plan C. Life Income
DISTRIBUTOR
PERFORMANCE INFORMATION
Money Market Portfolio
Other Portfolios
TAX STATUS
General
Diversification
Multiple Contracts
Contracts Owned by Other than Natural Persons
Tax Treatment of Assignments
Income Tax Withholding
Qualified Plans
Tax Treatment of Withdrawals -- Qualified Contracts
Tax-Sheltered Annuities -- Withdrawal Limitations
FINANCIAL STATEMENTS
LEGAL PROCEEDINGS
TABLE OF CONTENTS OF THE
STATEMENT OF ADDITIONAL INFORMATION
DEFINITIONS
ACCUMULATION PERIOD--The period during which Purchase Payments may be made
prior to the Maturity Date.
ACCUMULATION UNIT--A unit of measure used to calculate the Contract Value in a
Subaccount of the Separate Account prior to the Maturity Date.
AGE--The Annuitant's age on his or her last birthday.
ANNUITANT--The natural person on whose life Annuity Payments are based.
ANNUITY PAYMENTS--The series of payments after the Maturity Date under the
Payment Plan selected.
BENEFICIARY--The person the Owner has chosen to receive the Proceeds on the
Annuitant's death as shown on the Company's records. There may be different
classes of Beneficiaries, such as primary and contingent. These classes set
the order of payment. There may be more than one Beneficiary in a class.
COMPANY--Equitable Life Insurance Company of Iowa.
CONTRACT ANNIVERSARY--An anniversary of the Issue Date of the Contract.
CONTRACT YEAR--One year from the Issue Date and from each Contract
Anniversary.
FIXED ACCOUNT--The Company's general investment account which contains all the
assets of the Company with the exception of the Separate Account and other
segregated asset accounts.
INVESTMENT OPTION--An investment entity the Company may make available from
time to time.
ISSUE DATE/DATE OF ISSUE--The effective date of the Contract.
MATURITY DATE--The date on which Annuity Payments begin.
NON-QUALIFIED CONTRACTS--Contracts issued under non-qualified plans which do
not receive favorable tax treatment under Sections 401, 403(b) or 408 of the
Internal Revenue Code of 1986, as amended (the "Code").
OWNER--The person(s) who owns the Contract. The Owner may be someone other
than the Annuitant. There may be Joint Owners.
PORTFOLIO--A segment of an Investment Option which constitutes a separate and
distinct class of shares.
PROCEEDS--Proceeds are the amounts payable under the Contract.
PURCHASE PAYMENT--An amount paid to the Company to provide benefits under the
Contract. A Purchase Payment does not include transfers between the Separate
Account and the Fixed Account or among Subaccounts.
PURCHASE PAYMENT ANNIVERSARY--The anniversary of a Purchase Payment.
QUALIFIED CONTRACTS--Contracts issued under qualified plans which receive
favorable tax treatment under Sections 401, 403(b) or 408 of the Code.
SEPARATE ACCOUNT--A separate investment account of the Company designated as
Equitable Life Insurance Company of Iowa Separate Account A, into which
Purchase Payments or Contract Values may be allocated.
SUBACCOUNT--A segment of the Separate Account representing an investment in an
Investment Option.
VALUATION DATE--The Separate Account will be valued each day that the New York
Stock Exchange and the Company's Annuity Service Center both are open for
business.
VALUATION PERIOD--The period beginning at the close of business of the New
York Stock Exchange on each Valuation Date and ending at the close of business
for the next succeeding Valuation Date.
HIGHLIGHTS
At the Owner's direction, Purchase Payments for the Contracts will be
allocated to a segregated investment account of Equitable Life Insurance
Company of Iowa (the "Company") which account has been designated Equitable
Life Insurance Company of Iowa Separate Account A (the "Separate Account") or
to the Company's Fixed Account. Under certain circumstances, however,
Purchase Payments may initially be allocated to the Money Market Subaccount of
the Separate Account (see below). The Separate Account invests in shares of
Equi-Select Series Trust (see "Equi-Select Series Trust" on Page __), Smith
Barney/Travelers Series Fund Inc. (See "Smith Barney/Travelers Series Fund
Inc." on Page __) and Smith Barney Series Fund (see "Smith Barney Series Fund"
on Page __). The Separate Account may invest in other Investment Options.
Owners bear the investment risk for all amounts allocated to the Separate
Account.
Within twenty (20) days of the date of receipt of the Contract by the Owner
(or within ten (10) days of the date of receipt with respect to the
circumstances described in (a) and (b) below or in states where required or,
within thirty (30) days in the case of a Contract issued in the State of
California to an individual who is sixty (60) years of age or older, it may be
returned by delivering or mailing it to the Company at its Annuity Service
Center. When the Contract is received at the Annuity Service Center, the
Company will refund the Contract Value computed at the end of the Valuation
Period during which the Contract is received by the Company except in the
following circumstances: (a) where the Contract is purchased pursuant to an
Individual Retirement Annuity; (b) in those states which require the Company
to refund Purchase Payments, less withdrawals; or (c) in the case of Contracts
(including Contracts purchased pursuant to an Individual Retirement Annuity)
which are deemed by certain states to be replacing an existing annuity or
insurance contract and which require the Company to refund Purchase Payments,
less withdrawals. With respect to the circumstances described in (a), (b) and
(c) above, the Company will refund the greater of Purchase Payments, less any
withdrawals, or the Contract Value, and will allocate initial purchase
payments to the Money Market Subaccount until the expiration of fifteen days
from the Issue Date (or twenty-five days in the case of Contracts described
under (c) above). Upon the expiration of the fifteen day period (or
twenty-five day period with respect to Contracts described under (c)), the
Subaccount value of the Money Market Subaccount will be allocated to the
Separate Account or Fixed Account in accordance with the election made by the
Owner in the Application. In Pennsylvania, when the Contract is purchased
pursuant to an Individual Retirement Annuity and is not deemed to be replacing
an existing annuity or insurance contract, the Owner may return the Contract
within twenty (20) days of receipt. Further, in Pennsylvania when the
Contract is received at the Annuity Service Center during the first seven
days, the Company will refund the greater of Purchase Payments, less
withdrawals or the Contract Value, thereafter (days 8-20), the Company will
refund the Contract Value computed at the end of the Valuation Period during
which the Contract is received by the Company. In Oregon, when the Contract is
purchased pursuant to an Individual Retirement Annuity, the Owner may return
the Contract within twenty (20) days of receipt. Further, when the Contract is
received at the Annuity Service Center during the first ten days, the Company
will refund the greater of the initial Purchase Payment, less any withdrawals
or the Contract Value as of the date of cancellation. Thereafter (days 11-20),
the Company will refund the Contract Value as of the date of cancellation. The
initial Purchase Payment will be allocated to the Money Market Sub-Account as
described above.
A Withdrawal Charge (sales load) may be deducted in the event of a withdrawal
of all or a portion of the Contract Value. The Withdrawal Charge percentages
are based upon the number of Purchase Payment Anniversaries that Purchase
Payments have remained in the Contract before being withdrawn:
TABLE OF WITHDRAWAL CHARGES
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PURCHASE PAYMENT ANNIVERSARY WITHDRAWAL CHARGE
- -------------------------------- ------------------------------------
1 8% of the Purchase Payment withdrawn
2 7% of the Purchase Payment withdrawn
3 6% of the Purchase Payment withdrawn
4 5% of the Purchase Payment withdrawn
5 4% of the Purchase Payment withdrawn
6 3% of the Purchase Payment withdrawn
7 2% of the Purchase Payment withdrawn
8 1% of the Purchase Payment withdrawn
9 and after 0% of the Purchase Payment withdrawn
</TABLE>
At any time, the Owner may make a withdrawal without the imposition of a
Withdrawal Charge of an amount equal to 10% of the total of all Purchase
Payments at the beginning of the Contract Year, less any Purchase Payments
previously withdrawn. Any withdrawals without a Withdrawal Charge not used in
a Contract Year may not be used in any subsequent Contract Year. (See "Charges
and Deductions -- Deduction for Withdrawal Charge (Sales Load)" on Page __.)
With respect to the assessment of a Withdrawal Charge, the distribution of
Purchase Payments from within a Subaccount or the Fixed Account is on a
first-in, first-out basis. (See "Withdrawals" on Page __.)
There is a Mortality and Expense Risk Charge which is equal, on an annual
basis, to 1.25% of the average daily net asset value of the Separate Account.
This Charge compensates the Company for assuming the mortality and expense
risks under the Contracts. (See "Charges and Deductions -- Deduction for
Mortality and Expense Risk Charge" on Page __.)
There is an Administrative Charge which is equal, on an annual basis, to .15%
of the average daily net asset value of the Separate Account. This Charge
compensates the Company for costs associated with the administration of the
Contracts and the Separate Account. (See "Charges and Deductions -- Deduction
for Administrative Charge" on Page __.)
There is an Annual Contract Maintenance Charge of $30 each Contract Year prior
to the Maturity Date. (See "Charges and Deductions -- Deduction for Annual
Contract Maintenance Charge" on Page __.)
Premium taxes or other taxes payable to a state or other governmental entity
will be charged against the Contract Values. Premium taxes generally range
from 0% to 4%. (See "Charges and Deductions -- Deduction for Premium Taxes"
on Page __.)
Under certain circumstances, a Transfer Fee may be assessed when an Owner
transfers Contract Values from one Subaccount to another Subaccount or to or
from the Fixed Account. (See "Charges and Deductions -- Deduction for
Transfer Fee" on Page __.)
There is a ten percent (10%) federal income tax penalty applied to the income
portion of any distribution from Non-Qualified Contracts. However, the
penalty is not imposed on amounts received: (a) after the taxpayer reaches age
59 1/2; (b) after the death of the Owner; (c) if the taxpayer is totally
disabled (for this purpose disability is as defined in Section 72(m)(7) of the
Code); (d) in a series of substantially equal periodic payments made not less
frequently than annually for the life (or life expectancy) of the taxpayer and
his or her Beneficiary; (e) under an immediate annuity; or (f) which are
allocable to purchase payments made prior to August 14, 1982. The Contract
provides that upon the death of the Annuitant prior to the Maturity Date, the
Death Proceeds will be paid to the named Beneficiary. Such payments made upon
the death of the Annuitant who is not the Owner of the Contract do not qualify
for the death of Owner exception described above, and will be subject to the
ten percent (10%) distribution penalty unless the Beneficiary is 59 1/2 or one
of the other exceptions to the penalty applies. For federal income tax
purposes, withdrawals are deemed to be on a last-in, first-out basis.
Separate tax withdrawal penalties and restrictions apply to Qualified
Contracts. (See "Tax Status -- Tax Treatment of Withdrawals -- Qualified
Contracts" on Page __.) For a further discussion of the taxation of the
Contracts, see "Tax Status" on Page __.
Withdrawals of amounts attributable to contributions made pursuant to a salary
reduction agreement (as defined in Section 403(b)(11) of the Code) are limited
to circumstances only when the Owner attains age 59 1/2, separates from
service, dies, becomes disabled (within the meaning of Section 72(m)(7) of the
Code) or in the case of hardship. Withdrawals for hardship are restricted to
the portion of the Owner's Contract Value which represents contributions made
by the Owner and does not include any investment result. The limitations on
withdrawals became effective on January 1, 1989, and apply only to: (1) salary
reduction contributions made after December 31, 1988; (2) income attributable
to such contributions; and (3) income attributable to amounts held as of
December 31, 1988. The limitations on withdrawals do not affect rollovers or
transfers between certain Qualified Plans. Tax penalties may also apply.
(See "Tax Status -- Tax Treatment of Withdrawals -- Qualified Contracts" on
Page __.) Owners should consult their own tax counsel or other tax adviser
regarding any distributions. (See "Tax Status -- Tax Sheltered Annuities --
Withdrawal Limitations" on Page __.)
See "Tax Status -- Diversification" for a discussion of owner control of the
underlying investments in a variable annuity contract.
Because of certain exemptive and exclusionary provisions, interests in the
Fixed Account are not registered under the Securities Act of 1933 and the
Fixed Account is not registered as an investment company under the Investment
Company Act of 1940, as amended. Accordingly, neither the Fixed Account nor
any interests therein are subject to the provisions of these Acts and the
Company has been advised that the staff of the Securities and Exchange
Commission has not reviewed the disclosures in the Prospectus relating to the
Fixed Account. Disclosures regarding the Fixed Account may, however, be
subject to certain generally applicable provisions of the federal securities
laws relating to the accuracy and completeness of statements made in
prospectuses.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA SEPARATE ACCOUNT A
FEE TABLE
OWNER TRANSACTION EXPENSES
Withdrawal Charge (see Note 2 below)
(as a percentage of Purchase Payments withdrawn)
<TABLE>
<CAPTION>
<S> <C>
PURCHASE PAYMENT ANNIVERSARY CHARGE
- -------------------------------- -------
1 8%
2 7%
3 6%
4 5%
5 4%
6 3%
7 2%
8 1%
9+ 0
</TABLE>
Transfer Fee (see Note 3 below) No charge for first 12 transfers in a
Contract Year; thereafter the fee is the
lesser of 2% of the Contract Value trans-
ferred or an amount not greater than $25.
Annual Contract Maintenance Charge $30 per Contract per year
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average account value)
<TABLE>
<CAPTION>
<S> <C>
Mortality and Expense Risk Charge 1.25%
Administrative Charge .15%
-----
Total Separate Account Annual Expenses 1.40%
</TABLE>
EQUI-SELECT SERIES TRUST'S ANNUAL EXPENSES
(as a percentage of the average daily net assets of a Portfolio)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
TOTAL
MANAGEMENT OTHER ANNUAL
FEES* EXPENSES** EXPENSES
------------- ------------ ----------
Advantage Portfolio .50 % .30 % .80 %
Government Securities Portfolio .75 % .50 % 1.25 %
International Fixed Income Portfolio .85 % .75 % 1.60 %
International Stock Portfolio .80 % .75 % 1.55 %
Money Market Portfolio .375% .30 % .675 %
Mortgage-Backed Securities Portfolio .75 % .50 % 1.25 %
OTC Portfolio .80 % .75 % 1.55 %
Research Portfolio .80 % .75 % 1.55 %
Short-Term Bond Portfolio .65 % .30 % .95 %
Total Return Portfolio .80 % .75 % 1.55 %
<FN>
* PRIOR TO OCTOBER 6, 1995, EQUITABLE INVESTMENT SERVICES, INC. ("EISI"),
THE TRUST'S INVESTMENT ADVISER, WAIVED ITS MANAGEMENT FEES FOR EACH OF THE
PORTFOLIOS.
** BEGINNING OCTOBER 6, 1995, EISI HAS UNDERTAKEN TO REIMBURSE EACH
PORTFOLIO FOR ALL OPERATING EXPENSES, EXCLUDING MANAGEMENT FEES, THAT EXCEED
.30% OF THE AVERAGE DAILY NET ASSETS OF THE ADVANTAGE, SHORT-TERM BOND AND
MONEY MARKET PORTFOLIOS, .50% OF THE AVERAGE DAILY NET ASSETS OF THE
MORTGAGE-BACKED SECURITIES AND GOVERNMENT SECURITIES PORTFOLIOS AND .75% OF
THE AVERAGE DAILY NET ASSETS OF THE INTERNATIONAL STOCK, INTERNATIONAL FIXED
INCOME, OTC, TOTAL RETURN AND RESEARCH PORTFOLIOS.
</TABLE>
SMITH BARNEY/TRAVELERS SERIES FUND INC.'S ANNUAL EXPENSES
(as a percentage of the average daily net assets of a Portfolio)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Total
Management Other Annual
Fees Expenses Expenses
----------- --------- ---------
Smith Barney Income and Growth Portfolio* .65 % .29% .94%
Smith Barney International Equity Portfolio .90 % .54% 1.44%
Smith Barney High Income Portfolio* .60 % .47% 1.07%
Smith Barney Money Market Portfolio* .60 % .34% .94%
<FN>
* SMITH BARNEY MUTUAL FUNDS MANAGEMENT INC., THE FUND'S INVESTMENT
MANAGER, WAIVED ALL OR PART OF ITS MANAGEMENT FEES FOR THE YEAR ENDED OCTOBER
31, 1995 FOR THE SMITH BARNEY INCOME AND GROWTH PORTFOLIO, SMITH BARNEY HIGH
INCOME PORTFOLIO AND SMITH BARNEY MONEY MARKET PORTFOLIO SUCH THAT THE ACTUAL
TOTAL ANNUAL EXPENSES CHARGED TO EACH PORTFOLIO IN 1995 WERE .73%, .70% AND
.65%, RESPECTIVELY. THIS VOLUNTARY FEE WAIVER CAN BE TERMINATED AT ANY TIME.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
SMITH BARNEY SERIES FUND'S ANNUAL EXPENSES
(as a percentage of the average daily net
assets of a Portfolio)
TOTAL
MANAGEMENT OTHER OPERATING
FEES EXPENSES EXPENSES
----------- --------- ----------
Appreciation Portfolio 0.75 % 0.13% 0.88%
Equity Income Portfolio 0.65 % 0.19% 0.84%
Equity Index Portfolio 0.60 % 0.40% 1.00%
Intermediate High Grade Portfolio 0.60 % 0.25% 0.85%
</TABLE>
EXAMPLES
An Owner would pay the following expenses on a $1,000 investment, assuming a
5% annual return on assets:
(a) if the Contract is fully surrendered at the end of each time period;
(b) if the Contract is not surrendered;
(c) if Payment Plan A - Option 2 is elected.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Time Periods
----------- ----------
EQUI-SELECT SERIES TRUST 1 year 3 years 5 years 10 years
---------- ----------- ---------- ----------
Advantage Portfolio a) $103.39 a) $125.92 a) $158.91 a) $262.03
b) $23.39 b) $71.92 b) $122.91 b) $262.03
c) $103.39 c) $125.92 c) $158.91 c) $262.03
Government Securities Portfolio a) $107.89 a) $139.42 a) $181.35 a) $306.45
b) $27.89 b) $85.42 b) $145.35 b) $306.45
c) $107.89 c) $139.42 c) $181.35 c) $306.45
International Fixed Income Portfolio a) $111.39 a) $149.79 a) $198.45 a) $339.54
b) $31.39 b) $95.79 b) $162.45 b) $339.54
c) $111.39 c) $149.79 c) $198.45 c) $339.54
International Stock Portfolio a) $110.89 a) $148.32 a) $196.03 a) $334.89
b) $30.89 b) $94.32 b) $160.03 b) $334.89
c) $110.89 c) $148.32 c) $196.03 c) $334.89
Money Market Portfolio a) $102.13 a) $122.14 a) $152.68 a) $249.30
b) $22.13 b) $68.14 b) $116.58 b) $249.30
c) $102.13 c) $122.14 c) $152.68 c) $249.30
Mortgage-Backed Securities Portfolio a) $107.89 a) $139.42 a) $181.35 a) $306.45
b) $27.89 b) $85.42 b) $145.35 b) $306.45
c) $107.89 c) $139.42 c) $181.35 c) $306.45
OTC Portfolio a) $110.89 a) $148.32 a) $196.03 a) $334.89
b) $30.89 b) $94.32 b) $160.03 b) $334.89
c) $110.89 c) $148.32 c) $196.03 c) $334.89
Research Portfolio a) $110.89 a) $148.32 a) $196.03 a) $334.89
b) $30.89 b) $94.32 b) $160.03 b) $334.89
c) $110.89 c) $148.32 c) $196.03 c) $334.89
Short-Term Bond Portfolio a) $104.89 a) $130.44 a) $166.45 a) $277.08
b) $24.89 b) $76.44 b) $130.45 b) $277.08
c) $104.89 c) $130.44 c) $166.45 c) $277.08
Total Return Portfolio a) $110.89 a) $148.32 a) $196.03 a) $334.89
b) $30.89 b) $94.32 b) $160.03 b) $334.89
c) $110.89 c) $148.32 c) $196.03 c) $334.89
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SMITH BARNEY/TRAVELERS SERIES FUND INC. 1 Year 3 Years 5 Years 10 Years
---------- ---------- --------- ---------
Smith Barney Income and Growth Portfolio a) 107.89 a) 139.42 a) 181.35 a) 306.45
b) 27.89 b) 85.42 b) 145.35 b) 306.45
c) 107.89 c) 139.42 c) 181.35 c) 306.45
Smith Barney International Equity Portfolio a) 110.39 a) 146.84 a) 193.60 a) 330.21
b) 30.39 b) 92.84 b) 157.60 b) 330.21
c) 110.39 c) 146.84 c) 193.60 c) 330.21
Smith Barney High Income Portfolio a) 107.89 a) 139.42 a) 181.35 a) 306.45
b) 27.89 b) 85.42 b) 145.35 b) 306.45
c) 107.89 c) 139.42 c) 181.35 c) 306.45
Smith Barney Money Market Portfolio a) 107.89 a) 139.42 a) 181.35 a) 306.45
b) 27.89 b) 85.42 b) 145.35 b) 306.45
c) 107.89 c) 139.42 c) 181.35 c) 306.45
SMITH BARNEY SERIES FUND
Appreciation Portfolio a) $104.19 a) $128.33 a) 162.94 a) 270.09
b) $ 24.19 b) $ 74.33 b) 126.94 b) 270.09
c) $104.19 c) $128.33 c) 162.94 c) 270.09
Equity Income Portfolio a) $103.79 a) $127.13 a) 160.93 a) 266.07
b) $ 23.79 b) $ 73.13 b) 124.93 b) 266.07
c) $103.79 c) $127.13 c) 160.93 c) 266.07
Equity Index Portfolio a) $105.39 a) $131.94 a) 168.95 a) 282.04
b) $ 25.39 b) $ 77.94 b) 132.95 b) 282.04
c) $105.39 c) $131.94 c) 168.95 c) 282.04
Intermediate High Grade Portfolio a) $103.89 a) $127.43 a) 161.43 a) 267.07
b) $ 23.89 b) $ 73.43 b) 125.43 b) 267.07
c) $103.89 c) $127.43 c) 161.43 c) 267.07
</TABLE>
NOTES TO FEE TABLE AND EXAMPLES
1. The purpose of the Fee Table is to assist the Owner in understanding
the various costs and expenses that an Owner will incur directly or
indirectly. For additional information, see "Charges and Deductions" in this
Prospectus and the Prospectus for Equi-Select Series Trust.
2. At any time the Owner may make a withdrawal without the imposition of
a Withdrawal Charge of an amount equal to 10% of the total of all Purchase
Payments at the beginning of the Contract Year, less any Purchase Payments
previously withdrawn. Any withdrawals without a Withdrawal Charge not used in
a Contract Year may not be used in a subsequent Contract Year.
3. If the Owner is participating in the Automatic Portfolio Rebalancing
program or Dollar Cost Averaging program providing for the automatic transfer
of funds from a Subaccount or the Fixed Account to any other Subaccount, such
transfers are currently not taken into account in determining the number of
transfers for the year or in determining any Transfer Fee. (See "Charges and
Deductions -- Deduction for Transfer Fee" on Page __ and "Purchase Payments
and Contract Value -- Dollar Cost Averaging" on Page __ and "Purchase Payments
and Contract Value - and Automatic Portfolio Rebalancing" on Page __.)
4. Premium taxes are not reflected. Premium taxes may apply. (See
"Charges and Deductions -- Deduction for Premium Taxes" on Page 11.)
5. THE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
CONDENSED FINANCIAL INFORMATION
The financial statements of Equitable Life Insurance Company of Iowa and
Equitable Life Insurance Company of Iowa Separate Account A may be found in
the Statement of Additional Information.
The table below gives per unit information about the financial history of each
Portfolio of Equi-Select Series Trust from commencement of operations (October
7, 1994) to December 31, 1995 and of the available Portfolios of Smith
Barney/Travelers Series Fund, Inc. from commencement of operations (April 5,
1995 for the Smith Barney Income and Growth Portfolio; March 27, 1995 for the
Smith Barney International Equity Portfolio; April 28, 1995 for the Smith
Barney High Income Portfolio; and May 24, 1995 for the Smith Barney Money
Market Portfolio) to December 31, 1995. This information should be read in
conjunction with the financial statements and related notes of the Separate
Account included in the Statement of Additional Information.
<TABLE>
<CAPTION>
<S> <C> <C>
Period from
EQUI-SELECT SERIES TRUST: Commencement of
Year Ended Operations
Dec. 31, 1995 to December 31, 1994
-------------- ------------------------
ADVANTAGE PORTFOLIO
Unit value at beginning of period $ 10.08 $ 10.00
Unit value at end of period $ 10.86 $ 10.08
No. of units outstanding at end of period 344,775 45,516
GOVERNMENT SECURITIES PORTFOLIO
Unit value at beginning of period $ 10.11 $ 10.00
Unit value at end of period $ 11.76 $ 10.11
No. of units outstanding at end of period 56,258 1,428
INTERNATIONAL FIXED INCOME PORTFOLIO
Unit value at beginning of period $ 10.06 $ 10.00
Unit value at end of period $ 11.55 $ 10.06
No. of units outstanding at end of period 311,689 5,098
INTERNATIONAL STOCK INDEX PORTFOLIO
Unit value at beginning of period $ 9.87 $ 10.00
Unit value at end of period $ 10.56 $ 9.87
No. of units outstanding at end of period 541,570 23,662
MONEY MARKET PORTFOLIO
Unit value at beginning of period $ 10.07 $ 10.00
Unit value at end of period $ 10.45 $ 10.07
No. of units outstanding at end of period 548,767 34,322
MORTGAGE-BACKED SECURITIES PORTFOLIO
Unit value at beginning of period $ 9.99 $ 10.00
Unit value at end of period $ 11.42 $ 9.99
No. of units outstanding at end of period 380,031 2,886
OTC PORTFOLIO
Unit value at beginning of period $ 10.35 $ 10.00
Unit value at end of period $ 13.21 $ 10.35
No. of units outstanding at end of period 759,597 63,781
RESEARCH PORTFOLIO
Unit value at beginning of period $ 9.72 $ 10.00
Unit value at end of period $ 13.10 $ 9.72
No. of units outstanding at end of period 1,255,752 69,177
SHORT-TERM BOND PORTFOLIO
Unit value at beginning of period $ 10.15 $ 10.00
Unit value at end of period $ 10.98 $ 10.15
No. of units outstanding at end of period 32,032 1,141
TOTAL RETURN PORTFOLIO
Unit value at beginning of period $ 9.81 $ 10.00
Unit value at end of period $ 12.05 $ 9.81
No. of units outstanding at end of period 1,312,565 33,106
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Period from
Commencement of
Operations
SMITH BARNEY/TRAVELERS SERIES FUND INC. to December 31, 1995
- ----------------------------------------------- -------------------------
SMITH BARNEY INCOME AND GROWTH PORTFOLIO
Unit value at beginning of period (4-5-95) $ 10.00
Unit value at end of period $ 12.05
No. of units outstanding at end of period 295,134
SMITH BARNEY INTERNATIONAL EQUITY PORTFOLIO
Unit value at beginning of period (3-27-95) $ 10.00
Unit value at end of period $ 11.56
No. of units outstanding at end of period 154,388
SMITH BARNEY HIGH INCOME PORTFOLIO
Unit value at beginning of period (4-28-95) $ 10.00
Unit value at end of period $ 10.94
No. of units outstanding at end of period 72,283
SMITH BARNEY MONEY MARKET PORTFOLIO
Unit value at beginning of period (5-24-95) $ 10.00
Unit value at end of period $ 10.23
No. of units outstanding at end of period 125,048
</TABLE>
THE COMPANY
Equitable Life Insurance Company of Iowa (the "Company") was founded in Iowa
in 1867 and is the oldest life insurance company west of the Mississippi. The
Company is currently licensed to do business in the District of Columbia and
all states except Maine, New Hampshire, New York and Vermont. The Company is
a wholly-owned subsidiary of Equitable of Iowa Companies, an Iowa corporation.
THE SEPARATE ACCOUNT
The Board of Directors of the Company adopted a resolution to establish a
segregated asset account pursuant to Iowa insurance law on January 24, 1994.
This segregated asset account has been designated Equitable Life Insurance
Company of Iowa Separate Account A (the "Separate Account"). The Company has
caused the Separate Account to be registered with the Securities and Exchange
Commission as a unit investment trust pursuant to the provisions of the
Investment Company Act of 1940.
The assets of the Separate Account are the property of the Company. However,
the assets of the Separate Account equal to the reserves and other contract
liabilities with respect to the Separate Account, are not chargeable with
liabilities arising out of any other business the Company may conduct.
Income, gains and losses, whether or not realized, are, in accordance with the
Contracts, credited to or charged against the Separate Account without regard
to other income, gains or losses of the Company. The Company's obligations
arising under the Contracts are general obligations.
The Separate Account meets the definition of a "separate account" under
federal securities laws.
The Separate Account is divided into Subaccounts, with the assets of each
Subaccount invested in one Portfolio of Equi-Select Series Trust, Smith
Barney/Travelers Series Fund Inc. and Smith Barney Series Fund. There is no
assurance that the investment objectives of any of the Portfolios will be met.
Owners bear the complete investment risk for Purchase Payments allocated to a
Subaccount. Contract Values will fluctuate in accordance with the investment
performance of the Subaccounts to which Purchase Payments are allocated, and
in accordance with the imposition of the fees and charges assessed under the
Contracts.
INVESTMENT OPTIONS
EQUI-SELECT SERIES TRUST
Equi-Select Series Trust ("Trust") has been established to act as one of the
funding vehicles for the Contracts offered. The Trust is managed by Equitable
Investment Services, Inc. ("EISI") which is a wholly-owned subsidiary of the
Equitable of Iowa Companies. EISI has retained Sub-Advisers for certain
Portfolios to make investment decisions and place orders. The Sub-Advisers
for the Portfolios are: CS First Boston Investment Management Limited with
respect to the International Fixed Income Portfolio; Strong Capital
Management, Inc. with respect to the Advantage, Government Securities,
International Stock and Short-Term Bond Portfolios and Massachusetts Financial
Services Company with respect to the OTC, Research and Total Return
Portfolios. See "Management of the Trust" in the Trust Prospectus, which
accompanies this Prospectus, for additional information concerning EISI and
the Sub-Advisers, including a description of advisory and sub-advisory fees.
PURCHASERS SHOULD READ THIS PROSPECTUS AND THE PROSPECTUS FOR EQUI-SELECT
SERIES TRUST CAREFULLY BEFORE INVESTING.
The Trust is an open-end management investment company. While a brief summary
of the investment objectives of the available Portfolios is set forth below,
more comprehensive information, including a discussion of potential risks,
is found in the current Prospectus for the Trust which is included with this
Prospectus. Additional Prospectuses and the Statement of Additional
Information can be obtained by calling or writing the Company's Home Office.
The Trust is intended to meet differing investment objectives with its
currently available separate Portfolios. SHARES OF THE GOVERNMENT SECURITIES
PORTFOLIO AND SHORT-TERM BOND PORTFOLIO ARE NO LONGER OFFERED FOR SALE.
The investment objectives of the Portfolios are as follows:
ADVANTAGE PORTFOLIO. The Advantage Portfolio seeks current income with a
very low degree of share-price fluctuation. The Portfolio invests primarily
in ultra short-term investment grade bonds. The Portfolio is designed for
investors who seek higher yields than money market funds generally offer and
who are willing to accept some modest principal fluctuation in order to
achieve that objective. Because its share price will vary, the Portfolio is
not an appropriate investment for those whose primary objective is absolute
principal stability. The Portfolio's investments include a combination of
high-quality money market instruments, as well as securities with longer
maturities and securities of lower quality. Under normal market conditions,
it is anticipated that the portfolio will maintain an average effective
maturity of one year or less.
GOVERNMENT SECURITIES PORTFOLIO. The Government Securities Portfolio
seeks total return by investing for a high level of current income with a
moderate degree of share-price fluctuation. The Portfolio is designed for
long-term investors who want to pursue higher income than shorter-term
securities generally provide, who are willing to accept the fluctuation in
principal associated with longer-term securities , and who seek the low credit
risk that U.S. Government securities generally carry. Under normal market
conditions, at least 80% of the Portfolio's total assets will be invested in
U.S. government securities.
INTERNATIONAL FIXED INCOME PORTFOLIO. The International Fixed Income
Portfolio seeks to provide high total return. The Portfolio will seek to
achieve its objective by investing in both domestic and foreign debt
securities and related foreign currency transactions. The total return will be
sought through a combination of current income, capital gains and gains in
currency positions. Under normal market conditions, the portfolio will invest
primarily in: (i) obligations issued or guaranteed by foreign national
governments, their agencies, instrumentalities, or political subdivisions;
(ii) U.S. government securities; (iii) debt securities issued or guaranteed by
supranational organizations, considered to be government securities. Under
normal conditions, the Portfolio's Sub-Adviser expects that the Portfolio
generally will be invested in at least six different countries, including the
U.S., although the Portfolio may at times invest all of its assets in a single
country. The Portfolio may invest a significant portion of its assets in
foreign securities. Investing in foreign securities generally involves risks
not ordinarily associated with investing in securities of domestic issuers.
Purchasers are cautioned to read the "Appendix -- Foreign Investments" in the
Trust Prospectus for a discussion of the risks involved in foreign investing.
INTERNATIONAL STOCK PORTFOLIO. The International Stock Portfolio seeks
capital growth. The Portfolio invests primarily in equity securities of
issuers located outside the United States. The Portfolio will invest at least
65% of its assets in foreign equity securities, including common stocks,
preferred stocks, securities that are convertible into common or preferred
stocks, such as warrants and convertible bonds, that are issued by companies
whose principal headquarters are located outside the United States. Under
normal market conditions, the Portfolio expects to invest at least 90% of its
assets in foreign equity securities. The Portfolio will normally invest in
securities of issuers located in at least three different countries. Investing
in foreign securities generally involves risks not ordinarily associated with
investing in securities of domestic issuers. Purchasers are cautioned to read
the "Implementation of Policies and Risks - International Stock Portfolio" in
the Trust Prospectus for a discussion of the risks involved in foreign
investing.
MONEY MARKET PORTFOLIO. The Money Market Portfolio seeks to obtain
maximum current income, consistent with the preservation of capital and the
maintenance of liquidity. The Portfolio will seek to achieve this objective
by investing exclusively in certain U.S. dollar-denominated money market
instruments maturing in 397 days or less. An investment in the Money Market
Portfolio is neither insured nor guaranteed by the U.S. Government.
MORTGAGE-BACKED SECURITIES PORTFOLIO. The Mortgage-Backed Securities
Portfolio seeks to obtain a high current return, consistent with safety of
principal primarily through investments in mortgage-backed securities.
Mortgage-backed securities represent interests in, or are secured by and
payable from, pools of mortgage loans, including collateralized mortgage
obligations.
OTC PORTFOLIO. The investment objective of the OTC Portfolio is to seek
to obtain long-term growth of capital. The Portfolio seeks to achieve its
objective by investing at least 65% of its assets, under normal circumstances,
in securities principally traded on the over-the-counter (OTC) securities
market.
RESEARCH PORTFOLIO. The Research Portfolio seeks to provide long-term
growth of capital and future income by investing a substantial portion of its
assets in the common stocks or securities convertible into common stocks of
companies believed to possess better than average prospects for long-term
growth. A smaller proportion of the assets may be invested in bonds,
short-term obligations, preferred stocks or common stocks whose principal
characteristic is income production rather than growth. The Portfolio
securities of the Research Portfolio are selected by the investment research
analysts in the Equity Research Group of the Sub-Adviser. The Portfolio's
assets are allocated to economic sectors (e.g. health care, technology,
consumer staples) and then to industry groups within these sectors (e.g.
within the health care sector, the managed care, drug and medical supply
industries). The allocation by sector and industry is determined by the
analysts acting together as a group.
SHORT-TERM BOND PORTFOLIO. The Short-Term Bond Portfolio seeks total
return by investing for a high level of current income with a low degree of
share-price fluctuation. The Portfolio is designed for investors who are
willing to accept some fluctuation in principal in order to pursue a higher
level of income than is generally available from money market securities.
Because its share price will vary, the Portfolio is not an appropriate
investment for those whose primary objective is absolute principal stability.
The Portfolio invests primarily in short-and intermediate-term, investment
grade bonds. Although the Portfolio may invest in any type of fixed income
security, under normal market conditions, at least 65% of the Portfolio's
assets will be invested in bonds, such as corporate and U.S. government debt
securities.
TOTAL RETURN PORTFOLIO. The Total Return Portfolio primarily seeks to
obtain above-average income (compared to a portfolio entirely invested in
equity securities) consistent with the prudent employment of capital. While
current income is the primary objective, the Portfolio believes that there
should also be a reasonable opportunity for growth of capital and income since
many securities offering a better than average yield may also possess growth
potential. Generally, at least 40% of the Portfolio's assets will be invested
in equity securities.
SMITH BARNEY/TRAVELERS SERIES FUND INC.
Smith Barney/Travelers Series Fund Inc. ("Fund") is an investment company
underlying certain variable annuity and variable life insurance contracts. The
Fund is managed by Smith Barney Mutual Funds Management Inc. ("SBMFM" or
"Manager"). SBMFM is a wholly-owned subsidiary of Smith Barney Holdings Inc.
Smith Barney Holdings Inc. is a wholly-owned subsidiary of Travelers Group
Inc. which is a financial services holding company engaged through its
subsidiaries, principally in four business segments: Investment Services,
Consumer Finance Services, Life Insurance Services and Property & Casualty
Insurance Services.
The Fund is an open-end management investment company. While a brief summary
of the investment objectives is set forth below, more comprehensive
information, including a discussion of potential risks, is found in the
current Prospectus for the Fund, which is included with this Prospectus.
Additional Prospectuses and the Statement of Additional Information can be
obtained by calling or writing the Company's Home Office.
The Fund is intended to meet differing investment objectives with its
currently available separate Portfolios.
The investment objectives of the Portfolios are as follows:
SMITH BARNEY INCOME AND GROWTH PORTFOLIO. The Smith Barney Income and
Growth Portfolio seeks current income and long-term growth of income and
capital by investing primarily, but not exclusively, in common stocks. The
Portfolio invests primarily in common stocks offering a current return from
dividends and in interest-paying debt obligations (such as U.S. Government
Securities, investment grade bonds and debentures) and high quality short-term
debt obligations (such as commercial paper and repurchase agreements
collateralized by U.S. Government Securities with broker/dealers or other
financial institutions.)
SMITH BARNEY INTERNATIONAL EQUITY PORTFOLIO. The Smith Barney
International Equity Portfolio seeks total return on its assets from growth of
capital and income. The Portfolio seeks to achieve its objective by investing
at least 65% of its assets in a diversified portfolio of equity securities of
established non-U.S. issuers. Investing in foreign securities generally
involves risks not ordinarily associated with investing in securities of
domestic issuers. Purchasers are cautioned to read "Special Investment
Techniques and Risk Considerations - Foreign Securities" in the Fund
Prospectus.
SMITH BARNEY HIGH INCOME PORTFOLIO. The Smith Barney High Income
Portfolio seeks high current income. Capital appreciation is a secondary
objective. The Portfolio seeks to achieve its investment objectives by
investing, under normal circumstances, at least 65% of its assets in
high-yielding corporate debt obligations and preferred stock. The Portfolio
invests significantly in lower grade corporate debt securities, which are
commonly known as "junk bonds" and involve a significant degree of risk. (See
"The Fund's Investment Program - Smith Barney High Income Portfolio" in the
Fund Prospectus.) Prior to investing in this Portfolio, purchasers are
cautioned to read the section entitled "Special Investment Techniques and Risk
Considerations - Lower-Quality and Non-Rated Securities" in the Fund
Prospectus. The Portfolio may invest up to 20% of its assets in the securities
of foreign issuers that are denominated in currencies other than the U.S.
dollar and may invest without limitation in securities of foreign issuers that
are denominated in U.S. dollars. Investing in foreign securities generally
involves risks not ordinarily associated with investing in securities of
domestic issuers. Purchasers are cautioned to read "Special Investment
Techniques and Risk Considerations - Foreign Securities" in the Fund
Prospectus.
SMITH BARNEY MONEY MARKET PORTFOLIO. The Smith Barney Money Market
Portfolio seeks maximum current income and preservation of capital. The
Portfolio seeks to achieve its objectives by investing in bank obligations and
high quality commercial paper, corporate obligations and municipal
obligations, in addition to U.S. Government Securities and related repurchase
agreements. An investment in this Portfolio is neither insured nor guaranteed
by the U.S. Government. In addition, there is no assurance that the Portfolio
will be able to maintain a stable net asset value of $1.00 per share.
SMITH BARNEY SERIES FUND
Smith Barney Series Fund is a diversified, open-end management investment
company. Smith Barney Mutual Funds Management Inc. ("SBMFM") is the investment
adviser to the Appreciation Portfolio, Equity Income Portfolio and
Intermediate High Grade Portfolio (see "Smith Barney/Travelers Series Fund
Inc." above for information pertaining to SBMFM). Travelers Investment
Management Company ("TIMCO") is the investment adviser to the Equity Index
Portfolio.
Smith Barney Series Fund has ten Portfolios, four of which are currently
available in connection with the Contracts. While a brief summary of the
investment objectives is set forth below, more comprehensive information,
including a discussion of potential risks, is found in the current prospectus
for Smith Barney Series Fund, which is included with this Prospectus.
Additional prospectuses and the Statement of Additional Information can be
obtained by calling or writing the Company's Home Office.
Smith Barney Series Fund is intended to meet differing investment objectives
with its currently available separate Portfolios.
The investment objectives of the Portfolios are as follows:
APPRECIATION PORTFOLIO - The Appreciation Portfolio's goal is long-term
appreciation of capital. The Portfolio will attempt to achieve its goal by
investing primarily in equity and equity-related securities that are believed
to afford attractive opportunities for appreciation. Under normal market
conditions, substantially all - but not less than 65% - of the Portfolio's
assets will consist of common stocks, but the Portfolio also may hold
securities convertible into common stocks and warrants.
EQUITY INCOME PORTFOLIO - The Equity Income Portfolio's primary goal is
current income. Long-term capital appreciation is a secondary goal. The
Portfolio will seek to achieve its goals principally through investment in
dividend-paying common stocks of companies whose prospects for dividend growth
and capital appreciation are considered favorable by SBMFM. The Portfolio will
normally invest at least 65% of its assets in equity securities. Under normal
circumstances, the Portfolio will concentrate at least 25% of its assets in
equity and debt securities of companies in the utilities industry.
EQUITY INDEX PORTFOLIO - The Equity Index Portfolio's goal is to provide
investment results that, before deduction of operating expenses, match the
price and yield performance of U.S. publicly traded common stocks, as measured
by the Standard & Poor's 500 Composite Stock Price Index ("S&P 500"). Once the
Portfolio reaches a sufficient asset size, it will seek to achieve its goal by
owning all 500 stocks in the S&P 500 in proportion to their actual market
capitalization weightings. The Portfolio will be reviewed daily and will be
adjusted, when necessary, to maintain security weightings as close to those of
the S&P 500 as possible, given the amount of assets in the Portfolio at that
time.
INTERMEDIATE HIGH GRADE PORTFOLIO - The Intermediate High Grade
Portfolio's goal is to provide as high a level of current income as is
consistent with the protection of capital. The Portfolio will seek to achieve
its goal by investing, under normal circumstances, substantially all - but not
less than 65% - of its assets in U.S. government securities and high-grade
corporate bonds of U.S. issuers.
VOTING RIGHTS
In accordance with its view of present applicable law, the Company will vote
the shares of the Investment Options held in the Separate Account at special
meetings of the shareholders in accordance with instructions received from
persons having the voting interest in the Separate Account. The Company will
vote shares for which it has not received instructions, as well as shares
attributable to it, in the same proportion as it votes shares for which it has
received instructions. The Investment Options do not hold regular meetings of
shareholders.
The number of shares which a person has a right to vote will be determined as
of a date to be chosen by the Company not more than sixty (60) days prior to a
shareholder meeting of an Investment Option. Voting instructions will be
solicited by written communication prior to the meeting.
SUBSTITUTION OF SECURITIES
If the shares of the Investment Options (or any Portfolio within an Investment
Option or any other Investment Option), are no longer available for investment
by the Separate Account or, if in the judgment of the Company, further
investment in the shares should become inappropriate in view of the purpose of
the Contracts, the Company may substitute shares of another Investment Option
(or Portfolio) for shares already purchased or to be purchased in the future
by Purchase Payments under the Contracts. No substitution of securities may
take place without prior approval of the Securities and Exchange Commission
and under the requirements it may impose.
CHARGES AND DEDUCTIONS
Various charges and deductions are made from the Contract Value and the
Separate Account. These charges and deductions are:
DEDUCTION FOR WITHDRAWAL CHARGE (SALES LOAD)
If all or a portion of the Contract Value (see "Withdrawals" on Page 15) is
withdrawn, a Withdrawal Charge (sales load) will be calculated at the time of
each withdrawal and will be deducted from the Contract Value. This Charge
reimburses the Company for expenses incurred in connection with the promotion,
sale and distribution of the Contracts. The Withdrawal Charge percentages are
based upon the number of Purchase Payment Anniversaries that Purchase Payments
have remained in the Contract before being withdrawn as shown in the Table of
Withdrawal Charges below:
<TABLE>
<CAPTION>
TABLE OF WITHDRAWAL CHARGES
<S> <C>
PURCHASE PAYMENT ANNIVERSARY WITHDRAWAL CHARGE
____________________________ _____________________________________
1 8% of the Purchase Payment withdrawn
2 7% of the Purchase Payment withdrawn
3 6% of the Purchase Payment withdrawn
4 5% of the Purchase Payment withdrawn
5 4% of the Purchase Payment withdrawn
6 3% of the Purchase Payment withdrawn
7 2% of the Purchase Payment withdrawn
8 1% of the Purchase Payment withdrawn
9 and after 0% of the Purchase Payment withdrawn
</TABLE>
At any time the Owner may make a withdrawal without the imposition of a
Withdrawal Charge of an amount equal to 10% of the total of all Purchase
Payments at the beginning of the Contract Year less any Purchase Payments
previously withdrawn. Any withdrawals without a Withdrawal Charge not used in
a Contract Year may not be used in any subsequent Contract Year. With respect
to the assessment of a Withdrawal Charge, the distribution of Purchase
Payments from within a Subaccount or the Fixed Account are on a first-in,
first-out basis. (See "Withdrawals" on Page 15.)
Commissions will be paid to broker-dealers who sell the Contracts.
Broker-dealers will be paid commissions, up to an amount currently equal to
7.75% of Purchase Payments, for promotional or distribution expenses
associated with the marketing of the Contracts. The Company may, by agreement
with the broker-dealer, pay commissions as a combination of a certain
percentage amount at the time of sale and a trail commission (which when
combined could exceed 7.75% of Purchase Payments). In addition, under certain
circumstances, the Company may pay certain sellers production bonuses which
will take into account, among other things, the total Purchase Payments which
have been made under Contracts associated with the broker-dealer. Additional
payments or allowances may be made for other services not directly related to
the sale of the Contracts. To the extent that the Withdrawal Charge is
insufficient to cover the actual costs of distribution, the Company may use
any of its corporate assets, including potential profit which may arise from
the Mortality and Expense Risk Charge (see below), to provide for any
difference.
No Withdrawal Charge is deducted if Plan A -- Option 1; Plan B or Plan C is
elected. (See "Contract Proceeds -- Fixed Payment Plans" on Page 18.)
In addition, in certain states, an endorsement to the Contract is issued which
permits the Owner to make a total or partial withdrawal without the imposition
of a Withdrawal Charge if the Annuitant is hospitalized and/or confined to an
eligible nursing home for 30 consecutive days.
REDUCTION OR ELIMINATION OF THE WITHDRAWAL CHARGE
The amount of the Withdrawal Charge on the Contracts may be reduced or
eliminated when sales of the Contracts are made to individuals or to a group
of individuals in a manner that results in savings of sales expenses. The
entitlement to reduction of the Withdrawal Charge will be determined by the
Company after examination of all the relevant factors such as:
1. The size and type of group to which sales are to be made will be
considered. Generally, the sales expenses for a larger group are less than
for a smaller group because of the ability to implement large numbers of
Contracts with fewer sales contacts.
2. The total amount of Purchase Payments to be received will be
considered. Per Contract sales expenses are likely to be less on larger
Purchase Payments than on smaller ones.
3. Any prior or existing relationship with the Company will be
considered. Per Contract sales expenses are likely to be less when there is a
prior existing relationship because of the likelihood of implementing the
Contract with fewer sales contacts.
4. There may be other circumstances, of which the Company is not
presently aware, which could result in reduced sales expenses.
If, after consideration of the foregoing factors, the Company determines that
there will be a reduction in sales expenses, the Company may provide for a
reduction or elimination of the Withdrawal Charge.
The Company and its affiliates may offer an exchange program ("Exchange
Program") to their fixed annuity contract owners whereby a contract owner can
exchange his or her fixed annuity contract for a Contract offered by this
Prospectus. Pursuant to the Exchange Program, the Withdrawal Charge may be
reduced or eliminated so that a contract owner would not incur any additional
or higher Withdrawal Charge as a result of the exchange.
The Withdrawal Charge may be eliminated when the Contracts are issued to an
officer, director or employee of the Company or any of its affiliates. In no
event will reductions or elimination of the Withdrawal Charge be permitted
where reductions or elimination will be unfairly discriminatory to any person.
DEDUCTION FOR MORTALITY AND EXPENSE RISK CHARGE
The Company deducts on each Valuation Date a Mortality and Expense Risk Charge
which is equal, on an annual basis, to 1.25% (consisting of approximately .90%
for mortality risks and approximately .35% for expense risks) of the average
daily net asset value of the Separate Account. The mortality risks assumed by
the Company arise from its contractual obligation to make annuity payments
after the Annuity Date for the life of the Annuitant and to waive the
Withdrawal Charge in the event of the death of the Annuitant. Also, there is
a mortality risk borne by the Company with respect to the guaranteed death
benefit (see "Contract Proceeds -- Death Proceeds" on Page 17). The expense
risk assumed by the Company is that all actual expenses involved in
administering the Contracts, including Contract maintenance costs,
administrative costs, mailing costs, data processing costs, legal fees,
accounting fees, filing fees and the costs of other services may exceed the
amount recovered from the Annual Contract Maintenance Charge and the
Administrative Charge.
If the Mortality and Expense Risk Charge is insufficient to cover the actual
costs, the loss will be borne by the Company. Conversely, if the amount
deducted proves more than sufficient, the excess will be a profit to the
Company. The Company expects a profit from this charge.
The Mortality and Expense Risk Charge is guaranteed by the Company and cannot
be increased.
DEDUCTION FOR ADMINISTRATIVE CHARGE
The Company deducts on each Valuation Date an Administrative Charge which is
equal, on an annual basis, to .15% of the average daily net asset value of the
Separate Account. This charge, together with the Annual Contract Maintenance
Charge (see below), is to reimburse the Company for the expenses it incurs in
the establishment and maintenance of the Contracts and the Separate Account.
These expenses include but are not limited to: preparation of the Contracts,
confirmations, annual reports and statements, maintenance of Owner records,
maintenance of Separate Account records, administrative personnel costs,
mailing costs, data processing costs, legal fees, accounting fees, filing
fees, the costs of other services necessary for Owner servicing and all
accounting, valuation, regulatory and reporting requirements. Since this
charge is an asset-based charge, the amount of the charge attributable to a
particular Contract may have no relationship to the administrative costs
actually incurred by that Contract. The Company does not intend to profit
from this charge. This charge will be reduced to the extent that the amount
of this charge is in excess of that necessary to reimburse the Company for its
administrative expenses. Should this charge prove to be insufficient, the
Company will not increase this charge and will incur the loss.
DEDUCTION FOR ANNUAL CONTRACT MAINTENANCE CHARGE
The Company deducts an Annual Contract Maintenance Charge of $30 from the
Contract Value on each Contract Anniversary prior to the Maturity Date. This
charge is to reimburse the Company for its administrative expenses (see
above). This charge is deducted by subtracting values from the Fixed Account
and/or cancelling Accumulation Units from each applicable Subaccount in the
ratio that the value of each account bears to the total Contract Value. If a
total withdrawal is made on other than a Contract Anniversary, the Annual
Contract Maintenance Charge will be deducted at the time of withdrawal. If
the Maturity Date is not a Contract Anniversary, the Annual Contract
Maintenance Charge will be deducted from the Maturity Proceeds. The Company
has set this charge at a level so that, when considered in conjunction with
the Administrative Charge (see above), it will not make a profit from the
charges assessed for administration.
DEDUCTION FOR PREMIUM TAXES
The Contract provides that any premium or other taxes paid to any government
entity relating to the Contract will be deducted from the Purchase Payment or
Contract Value when incurred. Some states assess premium taxes at the time
Purchase Payments are made; others assess premium taxes at the time Annuity
Payments begin. Premium taxes generally range from 0% to 4%. The Contract
also provides that the Company may, at its sole discretion, pay taxes when due
and deduct that amount from the Contract Value at a later date. Payment at an
earlier date does not waive any right the Company may have to deduct amounts
at a later date. The Company currently intends to advance any premium taxes
due at the time Purchase Payments are made and then deduct such premium taxes
from an Owner's Contract Value at the time Annuity Payments begin or upon
withdrawal if the Company is unable to obtain a refund. The Company will, in
its sole discretion, determine when taxes have resulted from:
(1) the investment experience of the Separate Account;
(2) receipt by the Company of the Purchase Payments; or
(3) commencement of Annuity Payments.
DEDUCTION FOR INCOME TAXES
While the Company is not currently maintaining a provision for federal income
taxes with respect to the Separate Account, the Company has reserved the right
to establish a provision for income taxes if it determines, in its sole
discretion, that it will incur a tax as a result of the operation of the
Separate Account. The Company will deduct for any income taxes incurred by it
as a result of the operation of the Separate Account whether or not there was
a provision for taxes and whether or not it was sufficient. The Company will
deduct any withholding taxes required by applicable law.
DEDUCTION FOR TRUST EXPENSES
There are other deductions from and expenses paid out of the assets of the
Trust, including amounts paid for other expenses and amounts paid to the
Investment Adviser as Management Fees, which are described in the accompanying
Trust Prospectus.
DEDUCTION FOR TRANSFER FEE
Prior to the Maturity Date, the Owner may transfer all or part of the Owner's
interest in a Subaccount or the Fixed Account (subject to Fixed Account
provisions) without the imposition of any fee or charge if there have been no
more than 12 transfers made in the Contract Year. If more than 12 transfers
have been made in the Contract Year, the Company will deduct a Transfer Fee
which is equal to the lesser of 2% of the Contract Value transferred or an
amount not greater than $25. (The current amount is $25.) Currently, all
transfers made on any one day are considered a single transfer. If the Owner
is participating in the Automatic Portfolio Rebalancing program or the Dollar
Cost Averaging program providing for the automatic transfer of funds from a
Subaccount or the Fixed Account to any other Subaccount(s), such transfers
currently are not counted toward the number of transfers for the year and are
not taken into account in determining any Transfer Fee. However, the Company
reserves the right to treat multiple transfers in a single day, Automatic
Portfolio Rebalancing transfers and Dollar Cost Averaging transfers as
standard transfers when determining annual transfers and imposing the Transfer
Fee. (See "Purchase Payments and Contract Value -- Dollar Cost Averaging" on
Page __ and "Purchase Payments and Contract Value - Automatic Portfolio
Rebalancing" on Page __.)
THE CONTRACTS
OWNERSHIP
The Owner exercises all the rights under the Contract. The maximum issue Age
is 85 years old for Owners and Annuitants. The Owner may name a new Owner.
Any change in Ownership must be sent to the Company's Annuity Service Center
on a form acceptable to the Company. The change will go into effect when it
is signed, subject to any payments or actions taken by the Company before it
records it. The Company is not responsible for any tax consequences occurring
as a result of ownership changes.
ANNUITANT
The Annuitant is the natural person on whose life Annuity Payments are based.
The Annuitant is irrevocably named at the time the Contract is issued.
ASSIGNMENT
During the Annuitant's life, the Owner can assign some or all of the Owner's
rights under the Contract to someone else.
A signed copy of the assignment must be sent to the Company's Annuity Service
Center on a form acceptable to the Company. An assignment of the Contract is
not binding on the Company until the assignment, or a copy, is recorded at the
Annuity Service Center, subject to any payments or actions taken by the
Company before the recording. The Company is not responsible for the validity
or effect of any assignment, including any tax consequences.
The consent of any Irrevocable Beneficiaries is required before assignment of
Proceeds can happen.
BENEFICIARY
The Owner can name any Beneficiary to be an Irrevocable Beneficiary. The
interest of an Irrevocable Beneficiary cannot be changed without his or her
consent. Otherwise, the Owner can change Beneficiaries as explained below.
Unless the Owner states otherwise, all rights of a Beneficiary, including an
Irrevocable Beneficiary, will end if he or she dies before the Annuitant. If
any Beneficiary dies before the Annuitant, that Beneficiary's interest will
pass to any other Beneficiaries according to their respective interests. If
all Beneficiaries die before the Annuitant, upon the Annuitant's death the
Company will pay the Death Proceeds to the Owner, if living, otherwise to the
Owner's estate or legal successors.
The Owner can change the Beneficiary at any time during the Annuitant's life.
To do so, the Owner must send a written request to the Company's Annuity
Service Center. The request must be on a form acceptable to the Company. The
change will go into effect when signed, subject to any payments or actions
taken by the Company before it records the change.
A change cancels all prior Beneficiary designations; except, however, a change
will not cancel any Irrevocable Beneficiary without his or her consent. The
interest of the Beneficiary will be subject to:
(1) any assignment of the Contract, accepted and recorded by the Company
prior to the Annuitant's death; and
(2) any Payment Plan in effect on the date of the Annuitant's death.
Death Proceeds will be paid as though the Beneficiary died before the
Annuitant if:
(1) the Beneficiary dies at the same time as the Annuitant; or
(2) the Beneficiary dies within 24 hours of the Annuitant's death.
PURCHASE PAYMENTS AND CONTRACT VALUE
PURCHASE PAYMENTS
The initial Purchase Payment is due on the Issue Date. There is no Contract
until the initial Purchase Payment is paid. If any check presented as payment
of any part of the initial Purchase Payment for a Contract is not honored, the
Contract is void.
The minimum Purchase Payment for Non-Qualified Contracts is an aggregate of
$5,000 the first year and the minimum subsequent Purchase Payment is $100.
Under certain circumstances the Company may waive and/or modify the minimum
subsequent Purchase Payment requirement for Non-Qualified Contracts in the
case of large groups who submit Purchase Payments through Company approved
billing procedures. For Qualified Contracts, the minimum Purchase Payment is
$100 per month if payroll deduction is used; otherwise it is an aggregate of
$2,000 per year. Prior Company approval must be obtained for subsequent
Purchase Payments in excess of $500,000 or for total Purchase Payments in
excess of $1 million. The Company reserves the right to decline or accept any
Application or Purchase Payment.
ALLOCATION OF PURCHASE PAYMENTS
The initial Purchase Payment is allocated to the Fixed Account or the
Subaccount(s) of the Separate Account as elected by the Owner. Unless
otherwise changed by the Owner, subsequent Purchase Payments are allocated in
the same manner as the initial Purchase Payment. (In Oregon, Washington and
New Jersey, after the second Contract Year, subsequent Purchase Payments may
not be allocated to the Fixed Account.) Under certain circumstances, Purchase
Payments, which have been designated by prospective purchasers to be allocated
to the Fixed Account or Subaccounts other than the Money Market Subaccount,
may initially be allocated to the Money Market Subaccount during the free look
period. (See "Highlights" on Page __.) For each Subaccount, Purchase Payments
are converted into Accumulation Units. The number of Accumulation Units
credited to the Contract is determined by dividing the Purchase Payment
allocated to the Subaccount by the value of the Accumulation Unit for the
Subaccount. Purchase Payments allocated to the Fixed Account are credited in
dollars.
If the Application for a Contract is in good order, the Company will apply the
Purchase Payment to the Separate Account and credit the Contract with
Accumulation Units and/or to the Fixed Account and credit the Contract with
dollars within two business days of receipt. If the Application for a
Contract is not in good order, the Company will attempt to get it in good
order or the Company will return the Application and the Purchase Payment
within five (5) business days. The Company will not retain a Purchase Payment
for more than five (5) business days while processing an incomplete
Application unless it has been so authorized by the purchaser.
DOLLAR COST AVERAGING
Dollar Cost Averaging is a program which, if elected, permits an Owner to
systematically transfer each month amounts from any one Subaccount or the
Fixed Account (subject to Fixed Account provisions) to any Subaccount(s). By
allocating amounts on a regularly scheduled basis as opposed to allocating the
total amount at one particular time, an Owner may be less susceptible to the
impact of market fluctuations. The minimum amount which may be transferred is
$100. The minimum duration of participation in any Dollar Cost Averaging
program is currently five (5) months. An Owner must have a minimum of the
amount required in the Subaccount or the Fixed Account to complete the Owner's
designated program, in order to participate in the Dollar Cost Averaging
program.
All Dollar Cost Averaging transfers will be made on the 15th of each month or
another monthly date mutually agreed upon (or the next Valuation Date if the
15th of the month is not a Valuation Date). If the Owner is participating in
the Dollar Cost Averaging program, such transfers currently are not taken into
account in determining any Transfer Fee. The Company reserves the right to
treat Dollar Cost Averaging transfers as standard transfers when determining
the number of transfers in a year and imposing any applicable Transfer Fees.
An Owner participating in the Dollar Cost Averaging program may not make
automatic withdrawals of his or her Contract Value or participate in the
Automatic Portfolio Rebalancing program. (See "Purchase Payments and Contract
Value - Automatic Portfolio Rebalancing" on Page __ and "Withdrawals --
Automatic Withdrawals" on Page __.)
AUTOMATIC PORTFOLIO REBALANCING
Owners may participate in the Automatic Portfolio Rebalancing pursuant to
which Owners authorize the Company to automatically transfer all or a portion
of their Contract Value on a periodic basis to maintain a particular
percentage allocation among the Portfolios as selected by the Owner. The
Contract Value allocated to each Portfolio will increase or decrease at
different rates depending on the investment experience of the Portfolio and
Automatic Portfolio Rebalancing automatically reallocates the Contract Value
in the Portfolios selected to the allocation chosen by the Owner. Portfolios
that have Contract Value may not be included in Automatic Portfolio
Rebalancing unless selected by the Owner.
An Owner may select that rebalancing occur on a quarterly, semiannual or
annual basis and currently all Portfolios are available investment options
under Automatic Portfolio Rebalancing. The Fixed Account is excluded from
rebalancing. Currently, the Company offers Automatic Portfolio Rebalancing to
Owners with a Contract Value of greater than $25,000, but reserves the right
to offer the program on Contracts with a lesser amount. The Company reserves
the right to modify, suspend or terminate this service at any time.
All Automatic Portfolio Rebalancing transfers will be made on the 15th of the
month rebalancing is requested or another monthly date mutually agreed upon
(or the next Valuation Date, if the 15th of the month is a not a Valuation
Date). If the Owner is participating in the Automatic Portfolio Rebalancing
program, such transfers currently are not taken into account in determining
any Transfer Fee. The Company reserves the right to treat Automatic Portfolio
Rebalancing transfers as standard transfers when determining the number of
transfers in a year and imposing any applicable Transfer Fees. An Owner
participating in the Automatic Portfolio Rebalancing program may not make
automatic withdrawals of his or her Contract Value or participate in the
Dollar Cost Averaging Program (See "Purchase Payments and Contract
Value-Dollar Cost Averaging" on Page __ and "Withdrawals-Automatic
Withdrawals" on Page __.)
CONTRACT VALUE
The Contract Value, at any time, is the sum of:
(1) the Fixed Account Value; and
(2) the Separate Account Value.
The Separate Account value on any Valuation Date means the sum of the Owner's
interests in the Subaccounts of the Separate Account. The value of the
Owner's interest in a Subaccount is determined by multiplying the number of
Accumulation Units attributable to that Subaccount by the Accumulation Unit
value for the Subaccount. Any withdrawals or transfers will result in the
cancellation of Accumulation Units in a Subaccount. The Separate Account
values will vary with the performance of the Subaccounts of the Separate
Account, any Purchase Payments paid, partial withdrawals and charges assessed.
ACCUMULATION UNIT
A Purchase Payment when allocated to the Separate Account is converted into
Accumulation Units for the selected Subaccount. The number of Accumulation
Units in a Subaccount credited to the Contract is determined by dividing the
Purchase Payment allocated to that Subaccount by the Accumulation Unit value
for that Subaccount as of the Valuation Period during which the Purchase
Payment is allocated to the Subaccount. The Accumulation Unit value for each
Subaccount was arbitrarily set initially at $10. Subsequent Accumulation Unit
values are determined by subtracting (2) from (1) and dividing the result by
(3) where:
(1) is the net result of:
(a) the assets of the Subaccount attributable to Accumulation
Units; plus or minus
(b) the cumulative charge or credit for taxes reserved, which
resulted from the operation or maintenance of the Subaccount.
(2) is the cumulative unpaid charge for the Mortality and Expense Risk
Charge and for the Administrative Charge; and
(3) is the number of Accumulation Units outstanding at the end of the
Valuation Period.
The Accumulation Unit value may increase or decrease from Valuation Period to
Valuation Period.
TRANSFERS
Prior to the Maturity Date, the Owner may transfer all or part of the Owner's
interest in a Subaccount or the Fixed Account without the imposition of any
fee or charge if there have been no more than 12 transfers for the Contract
Year. All transfers are subject to the following:
(1) if more than 12 free transfers have been made in any Contract Year,
the Company will deduct a Transfer Fee for each subsequent transfer. (The
Transfer Fee is the lesser of 2% of Contract Value transferred or $25.) The
Transfer Fee will be deducted from the amount which is transferred. Transfers
from a Dollar Cost Averaging program or Automatic Portfolio Rebalancing
program are currently not counted toward the number of annual transfers and
are not taken into account in determining any applicable Transfer Fees.
Currently, all transfers in a single day are treated as a single transfer.
The Company reserves the right to treat Dollar Cost Averaging transfers,
Automatic Portfolio Rebalancing transfers and multiple transfers in a single
day as standard transfers in determining the number of annual transfers and
the imposition of any applicable Transfer Fees.
(2) the minimum amount which can be transferred is $100 or the Owner's
entire interest in the Subaccount or the Fixed Account, if less. The minimum
amount which must remain in a Subaccount or Fixed Account after a transfer is
$100 or the Subaccount must be liquidated.
(3) for any Contract Year, transfers of Purchase Payments and any
attributable earnings from the Fixed Account to a Subaccount are limited to
ten percent (10%) of the Purchase Payment and ten percent (10%) of its
attributable earnings. If a Purchase Payment was received at least eight (8)
years prior to the request for transfer, all of the Purchase Payment and the
earnings attributable to it may be transferred to a Subaccount. ( In New
Jersey, no amounts may be transferred to the Fixed Account after the second
Contract Year).
(4) any transfer direction must clearly specify:
(a) the amount which is to be transferred; and
(b) the Fixed Account or Subaccounts which are to be affected.
(5) transfers will be made as of the Valuation Period next following the
Valuation Period during which a written request for a transfer is received by
the Company.
(6) the Company reserves the right, at any time, and without prior
notice to any party, to terminate, suspend, or modify the transfer privilege
described above, subject to applicable state law and regulation.
An Owner may elect to make transfers by telephone. To elect this option the
Owner must do so in writing to the Company. If there are Joint Owners, unless
the Company is informed to the contrary, instructions will be accepted from
either one of the Joint Owners. The Company will use reasonable procedures to
confirm that instructions communicated by telephone are genuine. If it does
not, the Company may be liable for any losses due to unauthorized or
fraudulent instructions. The Company may tape record all telephone
instructions.
WITHDRAWALS
Prior to the Maturity Date, the Owner may, upon written request received by
the Company, make a total or partial withdrawal of the Contract Withdrawal
Value. (For Contracts issued in Idaho, no partial withdrawal may be made for
30 days after the Issue Date.) The Contract terminates if a total withdrawal
is made. The Contract Withdrawal Value is:
(1) the Contract Value for the Valuation Period next following the
Valuation Period during which a written request for a withdrawal is received
by the Company; less
(2) any applicable taxes not previously deducted; less
(3) the Withdrawal Charge, if any (see "Charges and Deductions --
Deduction for Withdrawal Charge (Sales Load)" on Page ); less
(4) the Annual Contract Maintenance Charge, if any.
A withdrawal will result in the cancellation of Accumulation Units for each
applicable Subaccount of the Separate Account or a reduction in the Fixed
Account Value. Unless otherwise instructed, a partial withdrawal will be
applied pro rata among each Subaccount and the Fixed Account based on the
ratio of the value of each Subaccount or Fixed Account to the Contract Value.
The Company will pay the amount of any withdrawal within seven (7) calendar
days of receipt of a request, unless the "Suspension of Payments or Transfers"
provision is in effect (see "Suspension of Payments or Transfers" below).
For purposes of determining any applicable Withdrawal Charges or any other
charges under the Contract, the distribution of Purchase Payments from within
a Subaccount or the Fixed Account is on a first-in, first-out basis with
earnings attributable to such Purchase Payments considered only after the
Purchase Payment is considered.
Each partial withdrawal must be for an amount which is not less than $100 or
the Owner's entire interest in the Subaccount or the Fixed Account, if less.
The minimum Contract Value which must remain in a Subaccount or the Fixed
Account after a partial withdrawal is $100.
Certain tax withdrawal penalties and restrictions may apply to withdrawals
from the Contracts. (See "Tax Status" on Page 21.) For Contracts purchased in
connection with 403(b) plans, the Code limits the withdrawal of amounts
attributable to contributions made pursuant to a salary reduction agreement
(as defined in Section 403(b)(11) of the Code) to circumstances only when the
Owner: (1) attains age 59 1/2; (2) separates from service; (3) dies; (4)
becomes disabled (within the meaning of Section 72(m)(7) of the Code); or (5)
in the case of hardship.
However, withdrawals for hardship are restricted to the portion of the Owner's
Contract Value which represents contributions made by the Owner and does not
include any investment results. The limitations on withdrawals became
effective on January 1, 1989 and apply only to salary reduction contributions
made after December 31, 1988, to income attributable to such contributions and
to income attributable to amounts held as of December 31, 1988. The
limitations on withdrawals do not affect rollovers or transfers between
certain Qualified Plans. Owners should consult their own tax counsel or other
tax adviser regarding any distributions.
AUTOMATIC WITHDRAWALS
At any time, an Owner may make a withdrawal each Contract Year of up to ten
percent (10%) of the total of all aggregate Purchase Payments at the beginning
of the Contract Year, less any Purchase Payments previously withdrawn, free
from Withdrawal Charges. Subject to any conditions and fees the Company may
impose, an Owner may elect to have this amount paid in equal periodic
installments ("automatic withdrawals"). The Company reserves the right to
charge a fee for automatic withdrawals. Currently, however, there are no
charges for automatic withdrawals.
Automatic withdrawals are made on the 15th of each month, or any other monthly
date mutually agreed upon (or the next following Valuation Date if the monthly
date is not a Valuation Date). Certain withdrawal penalties may apply to
withdrawals from the Contracts (see "Tax Status -- Tax Treatment of
Withdrawals -- Qualified Contracts" on Page __). Automatic withdrawals are
taken pro rata from Contract Value. The right to a 10% free single sum
withdrawal is forfeited. Automatic withdrawals are not allowed simultaneously
with the Dollar Cost Averaging program or Automatic Portfolio Rebalancing
program. (See "Purchase Payments and Contract Value -- Dollar Cost Averaging"
on Page __ and "Purchase Payments and Contract Value - Automatic Portfolio
Rebalancing" on Page __.)
TEXAS OPTIONAL RETIREMENT PROGRAM
A Contract issued to a participant in the Texas Optional Retirement Program
("ORP") will contain an ORP endorsement that will amend the Contract as
follows: A) If for any reason a second year of ORP participation is not begun,
the total amount of the State of Texas' first-year contribution will be
returned to the appropriate institute of higher education upon its request.
B) No benefits will be payable, through surrender of the Contract or
otherwise, until the participant dies, accepts retirement, terminates
employment in all Texas institutions of higher education or attains the age of
70 1/2. The value of the Contract may, however, be transferred to other
contracts or carriers during the period of ORP participation. A participant
in the ORP is required to obtain a certificate of termination from the
participant's employer before the value of a Contract can be withdrawn.
SUSPENSION OF PAYMENTS OR TRANSFERS
The Company reserves the right to suspend or postpone payments (in Illinois,
for a period not exceeding six months) for withdrawals or transfers for any
period when:
(1) the New York Stock Exchange is closed (other than customary weekend
and holiday closings);
(2) trading on the New York Stock Exchange is restricted;
(3) an emergency exists as a result of which disposal of securities held
in the Separate Account is not reasonably practicable or it is not reasonably
practicable to determine the value of the Separate Account's net assets; or
(4) when the Company's Annuity Service Center is closed;
(5) during any other period when the Securities and Exchange Commission,
by order, so permits for the protection of Owners; provided that applicable
rules and regulations of the Securities and Exchange Commission will govern as
to whether the conditions described in (2) and (3) exist.
The Company reserves the right to defer payment for a withdrawal or transfer
from the Fixed Account for the period permitted by law but not for more than
six months after written election is received by the Company.
CONTRACT PROCEEDS
MATURITY PROCEEDS
On the Maturity Date, the Company will pay the Maturity Proceeds of the
Contract to the Annuitant, if living, subject to the terms of the Contract.
If Payment Plan A, Option 1; Plan B; or Plan C are elected, the Maturity
Proceeds will be the Contract Value less any applicable taxes not previously
deducted. (See "Fixed Payment Plans" below.) If the Maturity Proceeds are
paid in cash or by any other method not listed above, the Maturity Proceeds
equal the Contract Value less:
(1) any applicable taxes not previously deducted; less
(2) the Withdrawal Charge, if any; less
(3) the Annual Contract Maintenance Charge, if any.
The election of a Payment Plan must be made in writing at least seven (7) days
prior to the Maturity Date. If no election is made, an automatic option of
monthly income for a minimum of 120 months and as long thereafter as the
Annuitant lives will be applied.
DEATH PROCEEDS
If death occurs prior to the end of the eighth Contract Year, the Death
Proceeds will be the greatest of:
(1) the sum of the Purchase Payments less any withdrawals including any
applicable Withdrawal Charge and any applicable taxes not previously deducted;
or
(2) the Contract Value less any applicable taxes not previously
deducted.
If death occurs after the end of the eighth Contract Year, the Death Proceeds
will be the greatest of:
(1) the sum of the Purchase Payments less any withdrawals including any
applicable Withdrawal Charge and less any applicable taxes not previously
deducted; or
(2) the Contract Value less any applicable taxes not previously
deducted; or
(3) the Contract Value at the end of the eighth Contract Year less any
withdrawals including any applicable Withdrawal Charge incurred since the end
of the eighth Contract Year and any applicable taxes not previously deducted.
The Death Proceeds will be determined and paid as of the Valuation Period next
following the Valuation Period during which both due proof of death
satisfactory to the Company and an election for the payment method from all
Beneficiaries are received at the Company.
The Beneficiary can elect to have a single lump sum payment or choose one of
the Payment Plans. If a single sum payment is requested, the amount will be
paid within seven (7) days, unless the Suspension of Payments or Transfers
provision is in effect.
Payment to the Beneficiary, other than in a single sum, may only be elected
during the 60-day period beginning with the date of receipt of due proof of
death on a form acceptable to the Company.
The entire Death Proceeds must be paid within five (5) years of the date of
death unless:
(1) the Beneficiary elects to have the Death Proceeds:
(a) payable under a Payment Plan over the life of the Beneficiary
or over a period not extending beyond the life expectancy of
the Beneficiary; and
(b) payable beginning within one year of the date of death; or
(2) if the Beneficiary is the Owner's Spouse, the Beneficiary may elect
to become the Owner of the Contract and the Contract will continue in effect.
DEATH OF THE ANNUITANT
(1) If the Annuitant dies prior to the Maturity Date, the Company will
pay the Death Proceeds as provided above except as provided in number (2)
below.
(2) If the Annuitant dies prior to the Maturity Date and if the
Annuitant was age 76 or greater on the Issue Date of the Contract, the Company
will pay the Death Proceeds as provided above except that the Death Proceeds
will equal the Contract Value less any applicable taxes not previously
deducted.
(3) If the Annuitant dies after the Maturity Date but before all of the
Proceeds payable under the Contract have been distributed, the Company will
pay the remaining Proceeds to the Beneficiary(ies) according to the terms of
the supplementary contract.
Provision (2) above is inapplicable in Florida.
DEATH OF OWNER
(1) If the Owner dies before the Maturity Date, ownership of the
Contract will be transferred as follows:
(a) if the Owner is also the Annuitant, the Death of the Annuitant
provision described above applies; or
(b) if the Owner is not also the Annuitant and if the new Owner is
the spouse of the Owner, the Contract may be continued; or
(c) if the Owner is not also the Annuitant and if the new Owner is
someone other than the spouse of the Owner, the Contract
Withdrawal Value must be distributed pursuant to the Death
Proceeds provision above.
(2) If the Owner dies on or after the Maturity Date, but before all
Proceeds payable under the Contract have been distributed, the Company will
continue payments according to the terms of the supplementary contract.
The Owner's spouse is the Owner's surviving spouse at the time of the Owner's
death. If the Owner is not a natural person, the death of the Annuitant will
be treated as the death of the Owner. If there are Joint Owners, any
references to the death of the Owner shall mean the first death of an Owner.
FIXED PAYMENT PLANS
After the first Contract Year, the Proceeds may be applied under one or more
of the Payment Plans described below. Payment Plans not specified in the
Contract are available only if they are approved both by the Company and the
Owner. The Owner chooses a Payment Plan during the Annuitant's lifetime.
This choice can be changed during the life of the Annuitant prior to the
Maturity Date. If the Owner has not chosen a plan prior to the Annuitant's
death, the automatic option of monthly income for a minimum of 120 months and
as long thereafter as the Payee lives will be applied.
The Owner chooses a plan by sending a written request to the Annuity Service
Center. The Company will send the Owner the proper forms to complete. The
request, when recorded at the Company's Annuity Service Center, will be in
effect from the date it was signed, subject to any payments or actions taken
by the Company before the recording. Any change must be requested at least
seven (7) days prior to the Maturity Date. If, for any reason, the person
named to receive payments (the Payee) is changed, the change will go into
effect when the request is recorded at the Company's Annuity Service Center,
subject to any payments or actions taken by the Company before the recording.
No Withdrawal Charge is deducted if Plan A-Option 1; Plan B or Plan C is
elected.
A plan is available only if the periodic payment is $100 or more. If the
Payee is other than a natural person (such as a corporation), a plan will be
available only with the Company's consent.
A supplementary contract will be issued in exchange for the Contract when
payment is made under a Payment Plan. The effective date of a Payment Plan
shall be a date upon which the Company and the Owner mutually agree.
The minimum interest rate for plans A and B is 3.0% a year, compounded yearly.
The minimum rates for Plan C were based on the 1983a Annuity Table at 3.0%
interest, compounded yearly. The Company may pay a higher rate at its
discretion.
PLAN A. INTEREST
OPTION 1--The Contract Value less any applicable taxes not previously
deducted may be left on deposit with the Company for five (5) years. Fixed
payments will be made monthly, quarterly, semi-annually, or annually. The
Company does not allow a monthly payment if the Contract Value applied under
this option is less than $100,000. The Proceeds may not be withdrawn until
the end of the five (5) year period.
OPTION 2--The Contract Withdrawal Value may be left on deposit with the
Company for a specified period. Interest will be paid annually. All or part
of the Proceeds may be withdrawn at any time.
PLAN B. FIXED PERIOD
The Contract Value less any applicable taxes not previously deducted will be
paid until the Proceeds, plus interest, are paid in full. Payments may be
paid annually or monthly. The payment period cannot be more than thirty (30)
years nor less than five (5) years. The Contract provides for a table of
minimum annual payments. They are based on the Age of the Annuitant or the
Beneficiary.
PLAN C. LIFE INCOME
The Contract Value less any applicable taxes not previously deducted will be
paid in monthly or annual payments for as long as the Annuitant or
Beneficiary, whichever is appropriate, lives. The Company has the right to
require proof satisfactory to it of the Age and sex of such person and proof
of continuing survival of such person. A minimum number of payments may be
guaranteed, if desired. The Contract provides for a table of minimum annual
payments. They are based on the Age of the Annuitant or the Beneficiary.
DISTRIBUTOR
Equitable of Iowa Securities Network, Inc. ("Securities Network"), 604 Locust
Street, Des Moines, Iowa 50309, acts as the distributor of the Contracts.
Securities Network is also a wholly-owned subsidiary of Equitable of Iowa
Companies. The Contracts are offered on a continuous basis.
PERFORMANCE INFORMATION
MONEY MARKET PORTFOLIO
From time to time, the Money Market Subaccount of the Separate Account may
advertise its "yield" and "effective yield." Both yield figures are based on
historical earnings and are not intended to indicate future performance. The
"yield" of the Money Market Subaccount refers to the income generated by
Contract Values in the Money Market Subaccount over a seven-day period (which
period will be stated in the advertisement). This income is "annualized."
That is, the amount of income generated by the investment during that week is
assumed to be generated each week over a 52-week period and is shown as a
percentage of the Contract Values in the Money Market Subaccount. The
"effective yield" is calculated similarly. However, when annualized, the
income earned by Contract Values is assumed to be reinvested. This results in
the "effective yield" being slightly higher than the "yield" because of the
compounding effect of the assumed reinvestment. The yield figure will reflect
the deduction of any asset-based charges and any applicable Annual Contract
Maintenance Charge, but will not reflect the deduction of any Withdrawal
Charge. The deduction of any Withdrawal Charge would reduce any percentage
increase or make greater any percentage decrease.
OTHER PORTFOLIOS
From time to time, the Company may advertise performance data for the various
other Portfolios under the Contract. Such data will show the percentage
change in the value of an Accumulation Unit based on the performance of an
investment medium over a period of time, usually a calendar year, determined
by dividing the increase (decrease) in value for that Unit by the Accumulation
Unit value at the beginning of the period. This percentage figure will
reflect the deduction of any asset-based charges and any applicable Annual
Contract Maintenance Charges under the Contracts, but will not reflect the
deduction of any Withdrawal Charge. The deduction of any Withdrawal Charge
would reduce any percentage increase or make greater any percentage decrease.
Any advertisement will also include total return figures calculated as
described in the Statement of Additional Information. The total return
figures reflect the deduction of any applicable Annual Contract Maintenance
Charge and Withdrawal Charges, as well as any asset-based charges.
The Company has decided to make available yield information with respect to
some of the Portfolios. Such yield information will be calculated as
described in the Statement of Additional Information. The yield information
will reflect the deduction of any applicable Annual Contract Maintenance
Charge as well as any asset-based charges.
The Company may also show historical Accumulation Unit values in certain
advertisements containing illustrations. These illustrations will be based on
actual Accumulation Unit values.
In addition, the Company may distribute sales literature which compares the
percentage change in Accumulation Unit values for any of the Portfolios
against established market indices such as the Standard & Poor's 500 Composite
Stock Price Index, the Dow Jones Industrial Average or other management
investment companies which have investment objectives similar to the Portfolio
being compared. The Standard & Poor's 500 Composite Stock Price Index is an
unmanaged, unweighted average of 500 stocks, the majority of which are listed
on the New York Stock Exchange. The Dow Jones Industrial Average is an
unmanaged, weighted average of thirty blue chip industrial corporations listed
on the New York Stock Exchange. Both the Standard & Poor's 500 Composite
Stock Price Index and the Dow Jones Industrial Average assume quarterly
reinvestment of dividends.
In addition, the Company may, as appropriate, compare each Subaccount's
performance to that of other types of investments such as certificates of
deposit, savings accounts and U.S. Treasuries, or to certain interest rate and
inflation indices, such as the Consumer Price Index, which is published by the
U.S. Department of Labor and measures the average change in prices over time
of a fixed "market basket" of certain specified goods and services. Similar
comparisons of Subaccount performance may also be made with appropriate
indices measuring the performance of a defined group of securities widely
recognized by investors as representing a particular segment of the securities
markets. For example, Subaccount performance may be compared with Donoghue
Money Market Institutional Averages (money market rates), Lehman Brothers
Corporate Bond Index (corporate bond interest rates) or Lehman Brothers
Government Bond Index (long-term U.S. Government obligation interest rates).
The Company may also distribute sales literature which compares the
performance of the Accumulation Unit values of the Contracts issued through
the Separate Account with the unit values of variable annuities issued through
the separate accounts of other insurance companies. Such information will be
derived from the Lipper Variable Insurance Products Performance Analysis
Service, the VARDS Report or from Morningstar.
The Lipper Variable Insurance Products Performance Analysis Service is
published by Lipper Analytical Services, Inc., a publisher of statistical data
which currently tracks the performance of almost 4,000 investment companies.
The rankings compiled by Lipper may or may not reflect the deduction of
asset-based insurance charges. The Company's sales literature utilizing these
rankings will indicate whether or not such charges have been deducted. Where
the charges have not been deducted, the sales literature will indicate that if
the charges had been deducted, the ranking might have been lower.
The VARDS Report is a monthly variable annuity industry analysis compiled by
Variable Annuity Research & Data Service of Atlanta and published by Financial
Planning Resources, Inc. The VARDS rankings may or may not reflect the
deduction of asset-based insurance charges. The Company's sales literature
utilizing these rankings will indicate whether or not such charges have been
deducted. Where the charges have not been deducted, the sales literature will
indicate that if the charges had been deducted, the ranking might have been
lower.
Morningstar rates a variable annuity subaccount against its peers with similar
investment objectives. Morningstar does not rate any subaccount that has less
than three years of performance data. The Company's sales literature
utilizing these rankings will indicate whether charges have been deducted.
Where the charges have not been deducted, the sales literature will indicate
that if the charges had been deducted, the ranking might have been lower.
TAX STATUS
GENERAL
NOTE: THE FOLLOWING DESCRIPTION IS BASED UPON THE COMPANY'S UNDERSTANDING OF
CURRENT FEDERAL INCOME TAX LAW APPLICABLE TO ANNUITIES IN GENERAL. THE
COMPANY CANNOT PREDICT THE PROBABILITY THAT ANY CHANGES IN SUCH LAWS WILL BE
MADE. PURCHASERS ARE CAUTIONED TO SEEK COMPETENT TAX ADVICE REGARDING THE
POSSIBILITY OF SUCH CHANGES. THE COMPANY DOES NOT GUARANTEE THE TAX STATUS OF
THE CONTRACTS. PURCHASERS BEAR THE COMPLETE RISK THAT THE CONTRACTS MAY NOT
BE TREATED AS "ANNUITY CONTRACTS" UNDER FEDERAL INCOME TAX LAWS. IT SHOULD BE
FURTHER UNDERSTOOD THAT THE FOLLOWING DISCUSSION IS NOT EXHAUSTIVE AND THAT
SPECIAL RULES NOT DESCRIBED IN THIS PROSPECTUS MAY BE APPLICABLE IN CERTAIN
SITUATIONS. MOREOVER, NO ATTEMPT HAS BEEN MADE TO CONSIDER ANY APPLICABLE
STATE OR OTHER TAX LAWS.
Section 72 of the Code governs taxation of annuities in general. An Owner is
not taxed on increases in the value of a Contract until distribution occurs,
either in the form of a lump sum payment or as annuity payments under the
Annuity Option selected. For a lump sum payment received as a total
withdrawal (total surrender), the recipient is taxed on the portion of the
payment that exceeds the cost basis of the Contract. For Non-Qualified
Contracts, this cost basis is generally the purchase payments, while for
Qualified Contracts there may be no cost basis. The taxable portion of the
lump sum payment is taxed at ordinary income tax rates.
For annuity payments, a portion of each payment in excess of an exclusion
amount is includible in taxable income. The exclusion amount for payments
based on a fixed annuity option is determined by multiplying the payment by
the ratio that the cost basis of the Contract (adjusted for any period certain
or refund feature) bears to the expected return under the Contract. Payments
received after the investment in the Contract has been recovered (i.e. when
the total of the excludible amounts equal the investment in the Contract) are
fully taxable. The taxable portion is taxed at ordinary income tax rates.
For certain types of Qualified Plans there may be no cost basis in the
Contract within the meaning of Section 72 of the Code. Owners, Annuitants and
Beneficiaries under the Contracts should seek competent financial advice about
the tax consequences of any distributions.
The Company is taxed as a life insurance company under the Code. For federal
income tax purposes, the Separate Account is not a separate entity from the
Company and its operations form a part of the Company.
DIVERSIFICATION
Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not, in
accordance with regulations prescribed by the United States Treasury
Department ("Treasury Department"), adequately diversified. Disqualification
of the Contract as an annuity contract would result in imposition of federal
income tax to the Owner with respect to earnings allocable to the Contract
prior to the receipt of payments under the Contract. The Code contains a safe
harbor provision which provides that annuity contracts such as the Contracts
meet the diversification requirements if, as of the end of each quarter, the
underlying assets meet the diversification standards for a regulated
investment company and no more than fifty-five percent (55%) of the total
assets consist of cash, cash items, U.S. Government securities and securities
of other regulated investment companies.
On March 2, 1989, the Treasury Department issued Regulations (Treas. Reg.
1.817-5), which established diversification requirements for the investment
portfolios underlying variable contracts such as the Contracts. The
Regulations amplify the diversification requirements for variable contracts
set forth in the Code and provide an alternative to the safe harbor provision
described above. Under the Regulations, an investment portfolio will be
deemed adequately diversified if: (1) no more than 55% of the value of the
total assets of the portfolio is represented by any one investment; (2) no
more than 70% of the value of the total assets of the portfolio is represented
by any two investments; (3) no more than 80% of the value of the total assets
of the portfolio is represented by any three investments; and (4) no more than
90% of the value of the total assets of the portfolio is represented by any
four investments.
The Code provides that, for purposes of determining whether or not the
diversification standards imposed on the underlying assets of variable
contracts by Section 817(h) of the Code have been met, "each United States
government agency or instrumentality shall be treated as a separate issuer".
The Company intends that all Portfolios of the Investment Options underlying
the Contracts will be managed by the investment advisers for the Investment
Options in such a manner as to comply with these diversification requirements.
The Treasury Department has indicated that the diversification Regulations do
not provide guidance regarding the circumstances in which Owner control of the
investments of the Separate Account will cause the Owner to be treated as the
owner of the assets of the Separate Account, thereby resulting in the loss of
favorable tax treatment for the Contract. At this time it cannot be
determined whether additional guidance will be provided and what standards may
be contained in such guidance.
The amount of Owner control which may be exercised under the Contract is
different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the Owner's ability to transfer among
investment choices or the number and type of investment choices available,
would cause the Owner to be considered as the owner of the assets of the
Separate Account resulting in the imposition of federal income tax to the
Owner with respect to earnings allocable to the Contract prior to receipt of
payments under the Contract.
In the event any forthcoming guidance or ruling is considered to set forth a
new position, such guidance or ruling will generally be applied only
prospectively. However, if such ruling or guidance was not considered to set
forth a new position, it may be applied retroactively resulting in the Owner
being retroactively determined to be the owner of the assets of the Separate
Account.
Due to the uncertainty in this area, the Company reserves the right to modify
the Contract in an attempt to maintain favorable tax treatment.
MULTIPLE CONTRACTS
The Code provides that multiple non-qualified annuity contracts which are
issued within a calendar year to the same contract owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse
tax consequences including more rapid taxation of the distributed amounts from
such combination of contracts. Owners should consult a tax adviser prior to
purchasing more than one non-qualified annuity contract in any calendar year.
CONTRACTS OWNED BY OTHER THAN NATURAL PERSONS
Under Section 72(u) of the Code, the investment earnings on premiums for
Contracts will be taxed currently to the Owner if the Owner is a non-natural
person, e.g., a corporation or certain other entities. Such Contracts
generally will not be treated as annuities for federal income tax purposes.
However, this treatment is not applied to Contracts held by a trust or other
entity as an agent for a natural person nor Contracts held by Qualified Plans.
Purchasers should consult their own tax counsel or other tax adviser before
purchasing a Contract to be owned by a non-natural person.
TAX TREATMENT OF ASSIGNMENTS
An assignment or pledge of a Contract may be a taxable event. Owners should
therefore consult competent tax advisers should they wish to assign or pledge
their Contracts.
INCOME TAX WITHHOLDING
All distributions or the portion thereof which is includible in the gross
income of the Owner are subject to Federal income tax withholding. Generally,
amounts are withheld from periodic payments at the same rate as wages and at
the rate of 10% from non-periodic payments. However, the Owner, in most
cases, may elect not to have taxes withheld or to have withholding done at a
different rate.
Effective January 1, 1993, certain distributions from retirement plans
qualified under Section 401 or Section 403(b) of the Code, which are not
directly rolled over to another eligible retirement plan or individual
retirement account or individual retirement annuity, are subject to a
mandatory 20% withholding for Federal income tax. The 20% withholding
requirement generally does not apply to: a) a series of substantially equal
payments made at least annually for the life or life expectancy of the
participant or joint and last survivor expectancy of the participant and a
designated beneficiary, or for a specified period of 10 years or more; b)
distributions which are required minimum distributions; or c) the portion of
the distributions not includible in gross income (i.e. returns of after-tax
contributions). Participants should consult their own tax counsel or other tax
advisor regarding withholding requirements.
TAX TREATMENT OF WITHDRAWALS -- NON-QUALIFIED CONTRACTS
Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the Contract Value exceeds the aggregate
purchase payments made, any amount withdrawn will be treated as coming first
from the earnings and then, only after the income portion is exhausted, as
coming from the principal. Withdrawn earnings are includible in gross income.
It further provides that a ten percent (10%) penalty will apply to the income
portion of any distribution. However, the penalty is not imposed on amounts
received: (a) after the taxpayer reaches age 59 1/2; (b) after the death of
the Owner; (c) if the taxpayer is totally disabled (for this purpose
disability is as defined in Section 72(m)(7) of the Code); (d) in a series of
substantially equal periodic payments made not less frequently than annually
for the life (or life expectancy) of the taxpayer or for the joint lives (or
joint life expectancies) of the taxpayer and his or her Beneficiary; (e) under
an immediate annuity; or (f) which are allocable to purchase payments made
prior to August 14, 1982.
The Contract provides that upon the death of the Annuitant prior to the
Maturity Date, the Death Proceeds will be paid to the named Beneficiary. Such
payments made upon the death of the Annuitant who is not the Owner of the
Contract do not qualify for the death of Owner exception described above, and
will be subject to the ten (10%) percent distribution penalty unless the
Beneficiary is 59 1/2 years old or one of the other exceptions to the penalty
applies.
The above information does not apply to Qualified Contracts. However,
separate tax withdrawal penalties and restrictions may apply to such Qualified
Contracts. (See "Tax Treatment of Withdrawals -- Qualified Contracts",
below.)
QUALIFIED PLANS
The Contracts offered by this Prospectus are designed to be suitable for use
under various types of qualified plans. Generally, participants in a
qualified plan are not taxed on increases to the value of the contributions to
the plan until distribution occurs, regardless of whether the plan assets are
held under an annuity contract. Taxation of participants in each qualified
plan varies with the type of plan and terms and conditions of each specific
plan. Owners, Annuitants and Beneficiaries are cautioned that benefits under
a qualified plan may be subject to the terms and conditions of the plan
regardless of the terms and conditions of the Contracts issued pursuant to the
plan. Some retirement plans are subject to distribution and other
requirements that are not incorporated into the Company's administrative
procedures. Contract Owners, participants and beneficiaries are responsible
for determining that contributions, distributions and other transactions with
respect to the Contracts comply with applicable law. Following are general
descriptions of the types of qualified plans with which the Contracts may be
used. Such descriptions are not exhaustive and are for general informational
purposes only. The tax rules regarding qualified plans are very complex and
will have differing applications depending on individual facts and
circumstances. Each purchaser should obtain competent tax advice prior to
purchasing a Contract issued under a qualified plan.
Contracts issued pursuant to qualified plans include special provisions
restricting Contract provisions that may otherwise be available as described
in this Prospectus. Generally, Contracts issued pursuant to qualified plans
are not transferable except upon surrender or annuitization. Various penalty
and excise taxes may apply to contributions or distributions made in violation
of applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from Qualified Contracts. (See "Tax
Treatment of Withdrawals -- Qualified Contracts", below.)
On July 6, 1983, the Supreme Court decided in Arizona Governing Committee v.
Norris that optional annuity benefits provided under an employer's deferred
compensation plan could not, under Title VII of the Civil Rights Act of 1964,
vary between men and women. The Contracts sold by the Company in connection
with certain Qualified Plans will utilize annuity tables which do not
differentiate on the basis of sex. Such annuity tables will also be available
for use in connection with certain non-qualified deferred compensation plans.
A. H.R. 10 PLANS
Section 401 of the Code permits self-employed individuals to establish
Qualified Plans for themselves and their employees, commonly referred to as
"H.R. 10" or "Keogh" plans. Contributions made to the Plan for the benefit
of the employees will not be included in the gross income of the employees
until distributed from the Plan. The tax consequences to participants may
vary depending upon the particular plan design. However, the Code places
limitations and restrictions on all Plans including on such items as: amount
of allowable contributions; form, manner and timing of distributions;
transferability of benefits; vesting and nonforfeitability of interests;
nondiscrimination in eligibility and participation; and the tax treatment of
distributions, withdrawals and surrenders. (See "Tax Treatment of Withdrawals
- -- Qualified Contracts" and "Tax-Sheltered Annuities - Withdrawal Limitations"
below.) Purchasers of Contracts for use with an H.R. 10 Plan should obtain
competent tax advice as to the tax treatment and suitability of such an
investment.
B. TAX-SHELTERED ANNUITIES
Section 403(b) of the Code permits the purchase of "tax-sheltered
annuities" by public schools and certain charitable, educational and
scientific organizations described in Section 501(c)(3) of the Code. These
qualifying employers may make contributions to the Contracts for the benefit
of their employees. Such contributions are not includible in the gross income
of the employees until the employees receive distributions from the Contracts.
The amount of contributions to the tax-sheltered annuity is limited to
certain maximums imposed by the Code. Furthermore, the Code sets forth
additional restrictions governing such items as transferability,
distributions, nondiscrimination and withdrawals. (See "Tax Treatment of
Withdrawals -- Qualified Contracts" and "Tax-Sheltered Annuities - Withdrawal
Limitations" below.) Any employee should obtain competent tax advice as to the
tax treatment and suitability of such an investment.
C. INDIVIDUAL RETIREMENT ANNUITIES
Section 408(b) of the Code permits eligible individuals to contribute to
an individual retirement program known as an "Individual Retirement Annuity"
("IRA"). Under applicable limitations, certain amounts may be contributed to
an IRA which will be deductible from the individual's gross income. These
IRAs are subject to limitations on eligibility, contributions, transferability
and distributions. (See "Tax Treatment of Withdrawals -- Qualified Contracts"
below.) Under certain conditions, distributions from other IRAs and other
Qualified Plans may be rolled over or transferred on a tax-deferred basis into
an IRA. Sales of Contracts for use with IRAs are subject to special
requirements imposed by the Code, including the requirement that certain
informational disclosure be given to persons desiring to establish an IRA.
Purchasers of Contracts to be qualified as Individual Retirement Annuities
should obtain competent tax advice as to the tax treatment and suitability of
such an investment.
D. CORPORATE PENSION AND PROFIT-SHARING PLANS
Sections 401(a) and 401(k) of the Code permit corporate employers to
establish various types of retirement plans for employees. These retirement
plans may permit the purchase of the Contracts to provide benefits under the
Plan. Contributions to the Plan for the benefit of employees will not be
includible in the gross income of the employees until distributed from the
Plan. The tax consequences to participants may vary depending upon the
particular plan design. However, the Code places limitations and restrictions
on all plans including on such items as: amount of allowable contributions;
form, manner and timing of distributions; transferability of benefits; vesting
and nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders. (See "Tax Treatment of Withdrawals -- Qualified Contracts"
below.) Purchasers of Contracts for use with Corporate Pension or
Profit-Sharing Plans should obtain competent tax advice as to the tax
treatment and suitability of such an investment.
TAX TREATMENT OF WITHDRAWALS -- QUALIFIED CONTRACTS
In the case of a withdrawal under a Qualified Contract, a ratable portion of
the amount received is taxable, generally based on the ratio of the
individual's cost basis to the individual's total accrued benefit under the
retirement plan. Special tax rules may be available for certain distributions
from a Qualified Contract. Section 72(t) of the Code imposes a 10% penalty tax
on the taxable portion of any distribution from qualified retirement plans,
including Contracts issued and qualified under Code Sections 401 (H.R. 10 and
Corporate Pension and Profit-Sharing Plans), 403(b) (Tax-Sheltered Annuities)
and 408(b) (Individual Retirement Annuities). To the extent amounts are not
includible in gross income because they have been rolled over to an IRA or to
another eligible qualified plan, no tax penalty will be imposed. The tax
penalty will not apply to the following distributions: (a) if distribution is
made on or after the date on which the Owner or Annuitant (as applicable)
reaches age 59 1/2; (b) distributions following the death or disability of the
Owner or Annuitant (as applicable) (for this purpose disability is as defined
in Section 72(m)(7) of the Code); (c) after separation from service,
distributions that are part of substantially equal periodic payments made not
less frequently than annually for the life (or life expectancy) of the Owner
or Annuitant (as applicable) or the joint lives (or joint life expectancies)
of such Owner or Annuitant (as applicable) and his or her designated
Beneficiary; (d) distributions to an Owner or Annuitant (as applicable) who
has separated from service after he has attained age 55; (e) distributions
made to the Owner or Annuitant (as applicable) to the extent such
distributions do not exceed the amount allowable as a deduction under Code
Section 213 to the Owner or Annuitant (as applicable) for amounts paid during
the taxable year for medical care; and (f) distributions made to an alternate
payee pursuant to a qualified domestic relations order. The exceptions stated
in (d), (e) and (f) above do not apply in the case of an Individual Retirement
Annuity. The exception stated in (c) above applies to an Individual
Retirement Annuity without the requirement that there be a separation from
service.
Generally, distributions from a qualified plan must commence no later than
April 1 of the calendar year, following the year in which the employee attains
age 70 1/2. Required distributions must be over a period not exceeding the
life expectancy of the individual or the joint lives or life expectancies of
the individual and his or her designated beneficiary. If the required minimum
distributions are not made, a 50% penalty tax is imposed as to the amount not
distributed. In addition, distributions in excess of $150,000 per year may be
subject to an additional 15% excise tax unless an exemption applies.
TAX-SHELTERED ANNUITIES -- WITHDRAWAL LIMITATIONS
The Code limits the withdrawal of amounts attributable to contributions made
pursuant to a salary reduction agreement (as defined in Section 403(b)(11) of
the Code) to circumstances only when the Owner: (1) attains age 59 1/2; (2)
separates from service; (3) dies; (4) becomes disabled (within the meaning of
Section 72(m)(7) of the Code); or (5) in the case of hardship. However,
withdrawals for hardship are restricted to the portion of the Owner's Contract
Value which represents contributions made by the Owner and does not include
any investment results. The limitations on withdrawals became effective on
January 1, 1989 and apply only to salary reduction contributions made after
December 31, 1988, to income attributable to such contributions and to income
attributable to amounts held as of December 31, 1988. The limitations on
withdrawals do not affect rollovers or transfers between certain Qualified
Plans. Owners should consult their own tax counsel or other tax adviser
regarding any distributions.
FINANCIAL STATEMENTS
Financial statements of the Company and the Separate Account have been
included in the Statement of Additional Information.
LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Separate
Account, the Distributor or the Company is a party.
In the ordinary course of business, the Company and its subsidiaries are also
engaged in certain other litigation none of which management believes is
material.
TABLE OF CONTENTS OF THE
STATEMENT OF ADDITIONAL INFORMATION
ITEM PAGE
Company.................................................................. 3
Experts.................................................................. 3
Legal Opinions........................................................... 3
Distributor.............................................................. 3
Yield Calculation for Money Market Subaccounts........................... 3
Performance Information.................................................. 4
Annuity Provisions....................................................... 5
Financial Statements..................................................... 5
<TABLE>
<CAPTION>
<S> <C>
________________________________________________________________________
__________________ _______
__________________ STAMP
__________________ _______
FRONT
- -----
Equitable Life Insurance Company of Iowa
Attention: Variable Products
P.O. BOX 9271
Des Moines, Iowa 50306-9271
________________________________________________________________________
________________________________________________________________________
Please send me, at no charge, the Statement of Additional Information
dated ____________ for the Individual Flexible Purchase Payment Deferred
Variable and Fixed Annuity Contracts issued by Equitable Life Insurance
Company of Iowa Separate Account A and Equitable Life Insurance Company
of Iowa.
(Please print or type and fill in all information)
BACK ________________________________________________________________________
- -----
Name
________________________________________________________________________
Address
________________________________________________________________________
City State Zip Code
Form #5344-A
________________________________________________________________________
</TABLE>
PART B
STATEMENT OF ADDITIONAL INFORMATION
INDIVIDUAL FLEXIBLE PURCHASE PAYMENT DEFERRED
VARIABLE AND FIXED ANNUITY CONTRACTS
issued by
EQUITABLE LIFE INSURANCE COMPANY OF IOWA SEPARATE ACCOUNT A
AND
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
THIS IS NOT A PROSPECTUS. THIS STATEMENT OF ADDITIONAL INFORMATION SHOULD BE
READ IN CONJUNCTION WITH THE PROSPECTUS DATED ___________, 1996, FOR THE
INDIVIDUAL FLEXIBLE PURCHASE PAYMENT DEFERRED VARIABLE AND FIXED ANNUITY
CONTRACTS WHICH ARE REFERRED TO HEREIN.
THE PROSPECTUS CONCISELY SETS FORTH INFORMATION THAT A PROSPECTIVE INVESTOR
OUGHT TO KNOW BEFORE INVESTING. FOR A COPY OF THE PROSPECTUS CALL OR WRITE
THE COMPANY AT: P.O. BOX 9271, DES MOINES, IOWA 50306-9271, (800) 344-6864.
THIS STATEMENT OF ADDITIONAL INFORMATION IS DATED ___________, 1996.
TABLE OF CONTENTS
PAGE
Company.................................................................. 3
Experts.................................................................. 3
Legal Opinions........................................................... 3
Distributor.............................................................. 3
Yield Calculation For Money Market Subaccounts........................... 3
Performance Information.................................................. 4
Annuity Provisions....................................................... 5
Financial Statements..................................................... 5
COMPANY
Information regarding Equitable Life Insurance Company of Iowa (the "Company")
and its ownership is contained in the Prospectus.
EXPERTS
The consolidated financial statements and schedules of the Company as of
December 31, 1994 and 1993 and for each of the three years in the period ended
December 31, 1994, and the financial statements of the Separate Account for
the period from October 7, 1994 (commencement of operations) to December 31,
1994, included herein have been audited by Ernst & Young LLP, independent
auditors, as set forth in their reports appearing elsewhere herein, and are
included in reliance upon such reports given upon the authority of such firm
as experts in accounting and auditing.
LEGAL OPINIONS
Legal matters in connection with the Contracts described herein are being
passed upon by the law firm of Blazzard, Grodd & Hasenauer, P.C., Westport,
Connecticut.
DISTRIBUTOR
Equitable of Iowa Securities Network, Inc. ("Securities Network") acts as the
distributor. Securities Network is an affiliate of the Company and is
registered as a broker-dealer. The offering is on a continuous basis.
YIELD CALCULATION FOR MONEY MARKET SUBACCOUNTS
The Money Market Subaccounts of the Separate Account will calculate their
current yield based upon the seven days ended on the date of calculation. For
the seven calendar days ended December 31, 1995, the annualized yield for the
Money Market Subaccount was 3.81%. For the seven calendar days ended December
31, 1995, the annualized yield for the Smith Barney Money Market Subaccount
was 3.86%.
The current yields of the Money Market Subaccounts are computed by determining
the net change (exclusive of capital changes) in the value of a hypothetical
pre-existing Owner account having a balance of one Accumulation Unit of the
Subaccount at the beginning of the period, subtracting the Mortality and
Expense Risk Charge, the Administrative Charge and the Annual Contract
Maintenance Charge, dividing the difference by the value of the account at the
beginning of the same period to obtain the base period return and multiplying
the result by (365/7).
The Money Market Subaccounts compute their effective compound yield according
to the method prescribed by the Securities and Exchange Commission. The
effective yield reflects the reinvestment of net income earned daily on Money
Market Subaccounts assets.
Net investment income for yield quotation purposes will not include either
realized capital gains and losses or unrealized appreciation and depreciation,
whether reinvested or not.
The yields quoted should not be considered a representation of the yield of
the Money Market Subaccounts in the future since the yield is not fixed.
Actual yields will depend not only on the type, quality and maturities of the
investments held by the Money Market Subaccounts and changes in the interest
rates on such investments, but also on changes in the Money Market
Subaccounts' expenses during the period.
Yield information may be useful in reviewing the performance of the Money
Market Subaccounts and for providing a basis for comparison with other
investment alternatives. However, the Money Market Subaccounts' yield
luctuates, unlike bank deposits or other investments which typically pay a
fixed yield for a stated period of time. The yield information does not
reflect the deduction of any applicable Withdrawal Charge at the time
of the surrender. (See "Charges and Deductions - Deduction for Withdrawal
Charge (Sales Load)" in the Prospectus.)
PERFORMANCE INFORMATION
From time to time, the Company may advertise performance data as described in
the Prospectus. Any such advertisement will include total return figures for
the time periods indicated in the advertisement. Such total return figures
will reflect the deduction of a 1.25% Mortality and Expense Risk Charge, a
.15% Administrative Charge, the investment advisory fee for the underlying
Portfolio being advertised and any applicable Annual Contract Maintenance
Charge and Withdrawal Charges.
The hypothetical value of a Contract purchased for the time periods described
in the advertisement will be determined by using the actual Accumulation Unit
values for an initial $1,000 purchase payment, and deducting any applicable
Annual Contract Maintenance Charge and any applicable Withdrawal Charge to
arrive at the ending hypothetical value. The average annual total return is
then determined by computing the fixed interest rate that a $1,000 purchase
payment would have to earn annually, compounded annually, to grow to the
hypothetical value at the end of the time periods described. The formula used
in these calculations is:
n
P ( 1 + T ) = ERV
<TABLE>
<CAPTION>
<S> <C> <C>
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value at the end of the time periods used
(or fractional portion thereof) of a hypothetical $1,000
payment made at the beginning of the time periods used.
</TABLE>
In addition to total return data, the Company may include yield information in
its advertisements. For each Subaccount (other than the Money Market
Subaccounts) for which the Company will advertise yield, it will show a yield
quotation based on a 30 day (or one month) period ended on the date of the
most recent balance sheet of the Separate Account included in the registration
statement, computed by dividing the net investment income per Accumulation
Unit earned during the period by the maximum offering price per Unit on the
last day of the period, according to the following formula:
Yield = a-b 6
[2(_____) + 1 - 1
cd
Where:
<TABLE>
<CAPTION>
<S> <C>
a = Net investment income earned during the period by the Trust
attributable to shares owned by the Subaccount.
b = Expenses accrued for the period (net of reimbursements).
c = The average daily number of Accumulation Units outstanding
during the period.
d = The maximum offering price per Accumulation Unit on the last
day of the period.
</TABLE>
The Company may also advertise performance data which will be calculated in
the same manner as described above but which will not reflect the deduction of
any Withdrawal Charge.
Owners should note that the investment results of each Subaccount will
fluctuate over time, and any presentation of the Subaccount's total return or
yield for any period should not be considered as a representation of what an
investment may earn or what an Owner's total return or yield may be in any
future period.
ANNUITY PROVISIONS
Currently, the Company makes available payment plans on a fixed basis only.
(See the Prospectus - "Contract Proceeds - Fixed Payment Plans" for a
description of the Payment Plans.)
FINANCIAL STATEMENTS
The consolidated financial statements of the Company included herein should be
considered only as bearing upon the ability of the Company to meet its
obligations under the Contracts.
Equitable Life Insurance Company of Iowa
Consolidated Balance Sheet - Unaudited
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
December 31
1995
___________
Assets
<S> <C>
Investments:
Fixed maturities:
Available for sale, at market (cost: 1995 - $6,884,837;
1994 - $819,083) $7,352,211
Held for investment, at amortized cost (market:
1994 - $5,059,090) --
Equity securities of unaffiliated companies, at market
(cost: 1995 - $49,788; 1994 - $23,351) 50,595
Equity security of affiliated company, at market
(cost: 1995 and 1994 - $618) 3,598
Mortgage loans on real estate 1,169,456
Real estate, less allowance for depreciation of $4,804
in 1995 and $4,659 in 1994 13,960
Policy loans 182,423
Short-term investments 35,283
___________
Total investments 8,807,526
Cash and cash equivalents 10,390
Securities and indebtedness of related parties 13,755
Accrued investment income 122,834
Notes and other receivables 32,395
Deferred policy acquisition costs 554,179
Property and equipment, less allowance for depreciation
of $9,628 in 1995 and $6,685 in 1994 8,026
Deferred income tax benefit --
Intangible assets, less accumulated amortization of $558
in 1995 and $483 in 1994 2,417
Other assets 47,991
Due from affiliates 1,995
Separate account assets 171,881
___________
Total assets $9,773,389
===========
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Balance Sheet (continued) - Unaudited
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
December 31
1995
___________
<S> <C>
Liabilities and stockholder's equity
Policy liabilities and accruals:
Future policy benefits:
Universal life and annuity products $7,428,134
Traditional life insurance products 778,857
Unearned revenue reserve 14,326
Other policy claims and benefits 8,980
___________
8,230,297
Other policyholders' funds:
Supplemental contracts without life contingencies 11,613
Advance premiums and other deposits 691
Accrued dividends 12,715
___________
25,019
Deferred income taxes 113,171
Due to affiliates 5,175
Other liabilities 180,452
Separate account liabilities 171,881
___________
Total liabilities 8,725,995
Commitments and contingencies
Stockholder's equity:
Common stock, par value $1.00 per share - authorized
7,500,000 shares, issued and outstanding 5,000,300
shares 5,000
Additional paid-in capital 274,009
Unrealized appreciation (depreciation)of fixed maturities 208,932
Unrealized appreciation of equity securities 3,787
Retained earnings 555,666
___________
Total stockholder's equity 1,047,394
___________
Total liabilities and stockholder's equity $9,773,389
===========
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statement of Income - Unaudited
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended
December 31
1995
___________
<S> <C>
Revenues:
Universal life and annuity product charges $51,466
Traditional life insurance premiums 43,425
Net investment income 638,056
Realized gains on investments 9,524
Other income 8,883
___________
751,354
Benefits and expenses:
Universal life and annuity benefits:
Interest credited to account balances 390,039
Benefit claims incurred in excess of account balances 10,396
Traditional life insurance benefits:
Death benefits 26,677
Other benefits 41,661
Increase (decrease) in future traditional policy benefits:
Life (6,172)
Other contracts (695)
Distributions to participating policyholders 25,125
Underwriting, acquisition and insurance expenses:
Commissions 146,224
General expenses 40,941
Insurance taxes 45,472
Policy acquisition costs deferred (178,133)
Amortization of deferred policy acquisition costs 72,537
___________
614,072
Interest expense 2,565
Other expenses (9)
___________
616,628
___________
134,726
Income taxes 47,233
___________
87,493
Equity income (loss), net of related income taxes 17
___________
Net income $87,510
===========
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statement of Changes in Stockholder's Equity - Unaudited
(Dollars in thousands)
<TABLE>
<CAPTION>
Unreal- Unreal-
ized ized
Appre Appre
ciation ciation
(Depre (Depre
ciation) ciation)
Addi- of of Total
tional Fixed Equity Stock-
Common Paid-In Matur- Secur- Retained holder's
Stock Capital ities ities Earnings Equity
________ _________ _________ _______ _________ ____________
<S> <C> <C> <C> <C> <C> <C>
Balance at
January 1, 1995 $5,000 $224,009 ($26,493) $2,173 $468,156 $672,845
Net income for
1995 -- -- -- -- 87,510 87,510
Unrealized
appreciation
of fixed
maturity
securities -- -- 235,425 -- -- 235,425
Unrealized
appreciation
of equity
securities -- -- -- 1,614 -- 1,614
Contribution
from parent -- 50,000 -- -- -- 50,000
________ _________ _________ _______ _________ ____________
Balance at Decem-
ber 31, 1995 $5,000 $274,009 $208,932 $3,787 $555,666 $1,047,394
======== ========= ========= ======= ========= ============
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statement of Cash Flows - Unaudited
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended
December 31
1995
___________
<S> <C>
Operating activities
Net income $87,510
Adjustments to reconcile net income to net cash provided
by operations:
Adjustments related to universal life and annuity products:
Interest credited to account balances 390,039
Charges for mortality and administration (54,308)
Change in unearned revenues (293)
Increase in traditional life policy liabilities and accruals 2,758
Decrease in other policyholders' funds (756)
Increase in accrued investment income (16,875)
Policy acquisition costs deferred (178,133)
Amortization of deferred policy acquisition costs 72,537
Change in other assets, other liabilities and accrued
income taxes 42,496
Provision for depreciation and amortization (8,449)
Provision for deferred income taxes 1,117
Share of losses (equity in earnings) of related parties (27)
Realized gains on investments (9,524)
___________
Net cash provided by operating activities 328,092
Investing activities
Sale, maturity or repayment of investments:
Fixed maturities-available for sale 145,173
Fixed maturities-held for investment 203,395
Equity securities 6,572
Mortgage loans on real estate 53,545
Real estate 2,029
Policy loans 28,436
Short-term investments - net 10,513
___________
449,663
Acquisition of investments:
Fixed maturities-available for sale (943,285)
Fixed maturities-held for investment (59,758)
Equity securities (32,097)
Mortgage loans on real estate (612,449)
Real estate (1,018)
Policy loans (34,411)
Short-term investments - net --
___________
(1,683,018)
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statement of Cash Flows (continued) - Unaudited
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended
December 31
1995
___________
<S> <C>
Investing activities (continued)
Disposal of investments accounted for by the equity method $498
Additions to investments accounted for by the equity method --
Repayments of notes receivable 1,317
Issuance of notes receivable --
Sales of property and equipment 109
Purchases of property and equipment (3,397)
___________
Net cash used in investing activities (1,234,828)
Financing activities
Proceeds from line of credit borrowing 754,104
Repayment of line of credit borrowing (754,104)
___________
--
Receipts from universal life and annuity policies credited
to policyholder account balances 1,691,188
Return of policyholder account balances on universal life
policies and annuity policies (835,892)
Contributions from parent 50,000
___________
Net cash provided by financing activities 905,296
___________
Increase (decrease) in cash and cash equivalents (1,440)
Cash and cash equivalents at beginning of year 11,830
___________
Cash and cash equivalents at end of year $10,390
===========
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest $2,567
Income taxes 33,490
</TABLE>
Financial Statements
Equitable Life Insurance Company of Iowa
Years ended December 31, 1994, 1993 and 1992
with Report of Independent Auditors
Equitable Life Insurance Company of Iowa
Financial Statements
Years ended December 31, 1994, 1993 and 1992
Contents
Report of Independent Auditors
Audited Financial Statements
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Changes in Stockholder's Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Report of Independent Auditors
The Board of Directors and Stockholder
Equitable Life Insurance Company of Iowa
We have audited the accompanying consolidated balance sheets
of Equitable Life Insurance Company of Iowa (wholly owned by
Equitable of Iowa Companies) as of December 31, 1994 and
1993, and the related consolidated statements of income,
changes in stockholder's equity, and cash flows for each of
the three years in the period ended December 31, 1994.
Our audits also included the financial statement schedules
listed in the index at Item 24. These financial statements
and schedules are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial
statements and schedules based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards 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. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects,
the consolidated financial position of Equitable Life
Insurance Company of Iowa at December 31, 1994 and 1993, and
the consolidated results of their operations and their cash
flows for each of the three years in the period ended
December 31, 1994, in conformity with generally accepted
accounting principles. Also, in our opinion, the related
financial statement schedules, when considered in relation
to the basic financial statements taken as a whole, present
fairly in all material respects the information set forth
therein.
As discussed in Notes 3 and 6 to the consolidated financial
statements, in 1994 the Company changed its method of
accounting for certain investments in debt and equity
securities and, in 1992 the Company changed its method of
accounting for postretirement benefits other than pensions.
/s/ Ernst & Young LLP
Des Moines, Iowa
February 7, 1995
Equitable Life Insurance Company of Iowa
Consolidated Balance Sheets
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
December 31
1994 1993
_________________________
<S> <C> <C>
Assets
Investments
Fixed maturities:
Held for investment, at amortized cost (market:
1994 - $5,059,090; 1993 - $5,407,358) $5,393,798 $5,078,226
Available for sale, at market (cost: 1994 -
$819,083) 778,486 --
Equity securities of unaffiliated companies,
at market (cost: 1994 - $23,351; 1993 - $250) 22,978 83
Equity security of affiliated company, at market
(cost: 1994 and 1993 - $618) 3,164 3,794
Mortgage loans on real estate 610,185 343,732
Real estate, less allowance for depreciation
of $4,659 in 1994 and $4,580 in 1993 15,668 20,773
Policy loans 176,448 176,849
Short-term investments 45,796 58,090
___________ ___________
Total investments 7,046,523 5,681,547
Cash and cash equivalents 11,830 4,476
Securities and indebtedness of related parties 11,034 11,791
Accrued investment income 105,959 92,473
Notes and other receivables 23,173 27,364
Deferred policy acquisition costs 607,626 451,180
Property and equipment, less allowance for
depreciation of $6,685 in 1994 and $4,147 in 1993 7,806 7,365
Deferred income tax benefit 1,634 11,406
Intangible assets, less accumulated amortization
of $483 in 1994 and $409 in 1993 2,492 2,566
Other assets 43,784 37,039
Due from affiliates 13,598 104
Separate account assets 84,963 94,028
___________ ___________
Total assets $7,960,422 $6,421,339
=========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Balance Sheets (continued)
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
December 31
1994 1993
_________________________
<S> <C> <C>
Liabilities and stockholder's equity
Policy liabilities and accruals:
Future policy benefits:
Universal life and annuity products $6,237,107 $4,803,729
Traditional life insurance products 777,100 774,356
Unearned revenue reserve 14,317 14,451
Other policy claims and benefits 7,785 5,765
___________ ___________
7,036,309 5,598,301
Other policyholders' funds:
Supplemental contracts without life contingencies 12,224 11,729
Advance premiums and other deposits 790 925
Accrued dividends 12,761 13,251
___________ ___________
25,775 25,905
Other liabilities 136,408 94,957
Due to affiliates 4,122 7,897
Separate account liabilities 84,963 94,028
___________ ___________
Total liabilities 7,287,577 5,821,088
Commitments and contingencies
Stockholder's equity:
Common stock, par value $1.00 per share -
authorized 7,500,000 shares, issued and
outstanding 5,000,300 shares 5,000 5,000
Additional paid-in capital 224,009 224,009
Unrealized depreciation of fixed maturities (26,493) --
Unrealized appreciation of equity securities 2,173 3,009
Retained earnings 468,156 368,233
___________ ___________
Total stockholder's equity 672,845 600,251
___________ ___________
Total liabilities and stockholder's equity $7,960,422 $6,421,339
=========== ===========
</TABLE>
See accompanying notes.
Equitable Life Insurance Company of Iowa
Consolidated Statements of Income
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
<S> <C> <C> <C>
Revenues:
Universal life and annuity
product charges $43,767 $34,281 $30,412
Traditional life insurance premiums 46,265 46,870 43,022
Net investment income 521,646 432,044 360,530
Realized gains on investments 19,697 44,996 8,049
Other income 8,297 6,663 6,476
___________ ___________ ___________
639,672 564,854 448,489
Benefits and expenses:
Universal life and annuity benefits:
Interest credited to account balances 320,312 268,992 231,824
Benefit claims incurred in excess
of account balances 8,877 5,618 4,719
Traditional life insurance benefits:
Death benefits 24,143 21,919 19,920
Other benefits 32,780 32,343 40,473
Increase (decrease) in future
traditional policy benefits:
Life 3,026 3,531 (7,203)
Other contracts 324 (92) 234
Distributions to participating
policyholders 24,988 25,861 26,059
Underwriting, acquisition and
insurance expenses:
Commissions 157,028 113,450 84,367
General expenses 43,402 37,553 32,294
Insurance taxes 9,961 6,335 5,623
Policy acquisition costs deferred (193,263) (137,153) (104,105)
Amortization of deferred policy
acquisition costs 50,921 42,078 20,176
___________ ___________ ___________
482,499 420,435 354,381
Interest expense 2,069 457 16
Other expenses 1,880 322 341
___________ ___________ ___________
486,448 421,214 354,738
___________ ___________ ___________
153,224 143,640 93,751
Income taxes 53,262 50,469 29,560
___________ ___________ ___________
99,962 93,171 64,191
Equity income (loss), net of related
income taxes (39) 126 4
___________ ___________ ___________
Income before cumulative effect of
change in accounting principles 99,923 93,297 64,195
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statements of Income (continued)
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
<S> <C> <C> <C>
Cumulative effect on prior years (to
December 31, 1991) of change in
method of accounting for post-
retirement benefits, net of related
income tax benefit -- -- (4,415)
___________ ___________ ___________
Net income $99,923 $93,297 $59,780
=========== =========== ===========
</TABLE>
See accompanying notes.
Equitable Life Insurance Company of Iowa
Consolidated Statements of Changes in Stockholder's Equity
(Dollars in thousands)
<TABLE>
<CAPTION>
Unreal- Unreal-
ized ized
Appre Appre
ciation ciation
(Depre (Depre
ciation) ciation)
Addi- of of Total
tional Fixed Equity Stock-
Common Paid-In Matur- Secur- Retained holders'
Stock Capital ities ities Earnings Equity
________ _________ _________ _______ _________ _________
<S> <C> <C> <C> <C> <C> <C>
Balance at
January 1, 1992 $5,000 $124,009 ($349) $231,389 $360,049
Net income for
1992 -- -- -- 59,780 59,780
Unrealized
appreciation
of equity
securities -- -- 2,116 -- 2,116
Contribution from
parent -- 10,000 -- -- 10,000
Cash dividends
to parent -- -- -- (16,233) (16,233)
________ _________ _________ _______ _________ _________
Balance at
December 31, 1992 5,000 134,009 1,767 274,936 415,712
Net income for
1993 -- -- -- 93,297 93,297
Unrealized
appreciation
of equity
securities -- -- 1,242 -- 1,242
Contributions
from parent -- 90,000 -- -- 90,000
________ _________ _________ _______ _________ _________
Balance at
December 31, 1993 5,000 224,009 3,009 368,233 600,251
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statements of Changes in Stockholder's Equity (continued)
(Dollars in thousands)
<TABLE>
<CAPTION>
Unreal- Unreal-
ized ized
Appre Appre
ciation ciation
(Depre (Depre
ciation) ciation)
Addi- of of Total
tional Fixed Equity Stock-
Common Paid-In Matur- Secur- Retained holders'
Stock Capital ities ities Earnings Equity
________ _________ _________ _______ _________ _________
<S> <C> <C> <C> <C> <C> <C>
Cumulative effect
of change in
accounting prin-
ciple regarding
fixed maturity
securities -- -- 22,516 -- -- 22,516
Net income for
1994 -- -- -- -- 99,923 99,923
Unrealized
depreciation
of fixed
maturity
securities -- -- (49,009) -- -- (49,009)
Unrealized
depreciation
of equity
securities -- -- -- (836) -- (836)
________ _________ _________ _______ _________ _________
Balance at
December 31, 1994 $5,000 $224,009 ($26,493) $2,173 $468,156 $672,845
======== ========= ========= ======= ========= =========
</TABLE>
See accompanying notes.
Equitable Life Insurance Company of Iowa
Consolidated Statements of Cash Flows
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
<S> <C> <C> <C>
Operating activities
Net income $99,923 $93,297 $59,780
Adjustments to reconcile net income to
net cash provided by operations:
Adjustments related to universal life
and annuity products:
Interest credited to account balances 320,312 268,992 231,824
Charges for mortality and
administration (46,280) (31,151) (29,068)
Deferral of unearned revenues 981 1,472 379
Amortization of unearned revenue
reserve (1,430) (2,312) (873)
Increase (decrease) in traditional life
policy liabilities and accruals 3,750 5,987 (7,937)
Decrease in other policyholders' funds (130) (194) (339)
Increase in accrued investment income (13,486) (14,376) (11,813)
Policy acquisition costs deferred (193,263) (137,153) (104,105)
Amortization of deferred policy
acquisition costs 50,921 42,078 20,176
Change in other assets, other
liabilities and accrued income taxes 27,372 26,515 2,439
Provision for depreciation and
amortization (1,089) (426) 653
Provision for deferred income taxes 9,958 (3,138) 3,136
Share of losses (equity in earnings)
of related parties 51 (194) 27
Realized gains on investments (19,697) (44,996) (8,049)
___________ ___________ ___________
Net cash provided by operating
activities 237,893 204,401 156,230
Investing activities
Sale, maturity or repayment of investments:
Fixed maturities-held for investment 286,844 1,056,544 752,624
Fixed maturities-available for sale 204,847 -- --
Equity securities -- -- 11,519
Mortgage loans on real estate 47,886 49,008 34,456
Real estate 5,662 289 2,002
Policy loans 30,397 25,963 31,202
Short-term investments - net 12,294 -- 7,696
___________ ___________ ___________
587,930 1,131,804 839,499
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statements of Cash Flows (continued)
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
<S> <C> <C> <C>
Acquisition of investments:
Fixed maturities-held for investment $(1,422,409) $(2,121,604) $(1,606,055)
Fixed maturities-available for sale (181,303) -- --
Equity securities (23,101) -- --
Mortgage loans on real estate (314,255) (152,274) (63,145)
Real estate (876) (346) (388)
Policy loans (29,996) (26,083) (26,093)
Short-term investments - net -- (48,395) --
___________ ___________ ___________
(1,971,940) (2,348,702) (1,695,681)
Disposal of investments accounted for
by the equity method 489 939 1,304
Additions to investments accounted for
by the equity method (1,376) (467) (3,862)
Repayments of notes receivable 221 -- --
Issuance of notes receivable (2,438) -- --
Sales of property and equipment 281 107 636
Purchases of property and equipment (3,052) (4,300) (1,845)
___________ ___________ ___________
Net cash used in investing activities (1,389,885) (1,220,619) (859,949)
Financing activities
Proceeds from line of credit borrowing 1,053,746 594,494 47,745
Repayment of line of credit borrowing (1,053,746) (594,494) (47,745)
___________ ___________ ___________
-- -- --
Receipts from universal life and
annuity policies credited to
policyholder account balances 1,746,108 1,190,024 951,309
Return of policyholder account balances
on universal life and annuity
policies (586,762) (264,364) (242,764)
Contributions from parent -- 90,000 10,000
Cash dividends paid to parent -- -- (16,233)
___________ ___________ ___________
Net cash provided by financing
activities 1,159,346 1,015,660 702,312
___________ ___________ ___________
Increase (decrease) in cash and cash
equivalents 7,354 (558) (1,407)
Cash and cash equivalents at beginning
of year 4,476 5,034 6,441
___________ ___________ ___________
Cash and cash equivalents at end of year $11,830 $4,476 $5,034
=========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Consolidated Statements of Cash Flows (continued)
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
<S> <C> <C> <C>
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest $2,070 $457 $16
Income taxes 60,610 43,552 30,291
Noncash investing and financing activities:
Foreclosure of mortgage loans, including
taxes and costs capitalized ($106) and
operating funds retained ($283)
in 1993 250 6,577 1,100
Restructure of fixed maturity investment,
including fixed maturity ($897) and
equity security ($353) received -- -- 1,250
</TABLE>
See accompanying notes.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements
December 31, 1994
1. Significant Accounting Policies
Organization
Equitable Life Insurance Company of Iowa (the "Company") is
a wholly-owned subsidiary of Equitable of Iowa Companies
("parent"). The Company operates predominantly in the
individual life and annuity area of the life insurance
business.
Consolidation
The consolidated financial statements include the Company
and its subsidiaries. The Company's principal subsidiaries
are USG Annuity & Life Company ("USG"), Equitable American
Insurance Company ("EAIC") (formed in 1993) and Equitable
Companies. At December 31, 1994 and 1993, all subsidiaries
are wholly owned. All significant intercompany accounts and
transactions have been eliminated.
Investments
Effective January 1, 1994, the Company adopted Statement of
Financial Accounting Standards ("SFAS") No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities". Pursuant to SFAS No. 115, fixed maturity
securities that the Company has the positive intent and
ability to hold to maturity are designated as "held for
investment". Held for investment securities are reported at
cost adjusted for amortization of premiums and discounts.
Changes in the market value of these securities, except for
declines that are other than temporary, are not reflected in
the Company's financial statements. Fixed maturity
securities which may be sold are designated as "available
for sale". Available for sale securities are reported at
market value and unrealized gains and losses on these
securities are included directly in stockholder's equity,
after adjustment for related changes in deferred policy
acquisition costs, policy reserves and deferred income
taxes. Transfers of securities between categories are
restricted and are recorded at fair value at the time of
transfer. Securities that are determined to have a decline
in value that is other than temporary are written down to
estimated fair value which becomes the security's new cost
basis by a charge to realized losses in the Company's
Statement of Income. Premiums and discounts are
amortized/accrued utilizing the scientific interest method
which results in a constant yield over the securities'
expected life. Amortization/accrual of premiums and
discounts on mortgage-backed securities incorporates a
prepayment assumption to estimate the securities' expected
life.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
1. Significant Accounting Policies (continued)
Prior to the adoption of SFAS No. 115, all of the Company's
fixed maturity securities were classified as "held to
maturity". Fixed maturity securities were written down to
net realizable value (the sum of the estimated nondiscounted
cash flows from the securities) if the securities were
determined to have declines in value that were "other than
temporary". Future investment income was recognized at the
rate implicit in this calculation of net realizable value.
Equity securities (common and non-redeemable preferred
stocks) are reported at market if readily marketable, or at
cost if not readily marketable. The change in unrealized
appreciation and depreciation of marketable equity
securities (net of related deferred income taxes, if any) is
included directly in stockholder's equity. Equity
securities that are determined to have a decline in value
that is other than temporary are written down to estimated
fair value which becomes the security's new cost basis by a
charge to realized losses in the Company's Statement of
Income.
Mortgage loans on real estate are reported at cost adjusted
for amortization of premiums and accrual of discounts. If
the value of any mortgage loan is determined to be impaired
(i.e., when it is probable that the company will be unable
to collect all amounts due according to the contractual
terms of the loan agreement), the carrying value of the
mortgage loan is reduced to the present value of expected
future cash flows from the loan, discounted at the loan's
effective interest rate, or to the loan's observable market
price, or the fair value of the underlying collateral. The
carrying value of impaired loans is reduced by the
establishment of a valuation allowance which is adjusted at
each reporting date for significant changes in the
calculated value of the loan. Changes in this valuation
allowance are charged or credited to income.
Real estate, which includes real estate acquired through
foreclosure, is reported at cost less allowances for
depreciation. Real estate acquired through foreclosure, or
in-substance foreclosure, is recorded at the lower of cost
(which includes the balance of the mortgage loan, any
accrued interest and any costs incurred to obtain title to
the property) or fair value as determined at or before the
foreclosure date. The carrying value of these assets is
subject to regular review. If the fair value, less
estimated sale cost, of real estate owned decreases to an
amount lower than its carrying value, a valuation allowance
is established for the difference. This valuation allowance
can be restored should the fair value of the property
increase. Changes in this valuation allowance are charged
or credited to income.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
1. Significant Accounting Policies (continued)
Policy loans are reported at unpaid principal. Short-term
investments are reported at cost adjusted for amortization
of premiums and accrual of discounts. Investments accounted
for by the equity method include investments in, and
advances to, various joint ventures and partnerships.
Market values, as reported herein, of publicly-traded fixed
maturity securities are as reported by an independent
pricing service. Market values of conventional mortgage-
backed securities not actively traded in a liquid market are
estimated using a third-party pricing system, which uses a
matrix calculation assuming a spread over U. S. Treasury
bonds based upon the expected average lives of the
securities. Market values of private placement bonds are
estimated using a matrix that assumes a spread (based on
interest rates and a risk assessment of the bonds) over
U. S. Treasury bonds. Market values of redeemable preferred
stocks are as reported by the National Association of
Insurance Commissioners ("NAIC"). Market values of equity
securities are based on the latest quoted market prices, or
where not readily marketable, at values which are representative of
the market values of issues of comparable yield and quality.
Realized gains and losses are determined on the basis of
specific identification of investments.
Cash and Cash Equivalents
For purposes of the consolidated statement of cash flows,
the Company considers all demand deposits and interest-
bearing accounts not related to the investment function to
be cash equivalents. All interest-bearing accounts
classified as cash equivalents have original maturities of
three months or less.
Deferred Policy Acquisition Costs
Certain costs of acquiring new insurance business,
principally commissions and other expenses related to the
production of new business, have been deferred. For
universal life and annuity products, such costs are being
amortized generally in proportion to the present value
(using the assumed crediting rate) of expected gross
profits. This amortization is adjusted retrospectively, or
"unlocked", when the Company revises its estimate of current
or future gross profits to be realized from a group of
products. For traditional life insurance products, such
costs are being amortized over the premium-paying period of
the related policies in proportion to premium revenues
recognized, using principally the same assumptions for
interest, mortality and withdrawals that are used for
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
1. Significant Accounting Policies (continued)
computing liabilities for future policy benefits subject to
traditional "lock-in" concepts. Deferred policy acquisition
costs are adjusted to reflect the pro-forma impact of
unrealized gains and losses on fixed maturity securities the
Company has designated as "available for sale" under SFAS
No. 115.
Property and Equipment
Property and equipment primarily represent leasehold
improvements at the Company's headquarters and at various
agency offices and office furniture and equipment and are
not considered to be significant to the Company's overall
operations. Property and equipment are reported at cost
less allowances for depreciation. Depreciation expense is
computed primarily on the basis of the straight-line method
over the estimated useful lives of the assets.
Intangible Assets
Intangible assets include the value of various licenses
acquired in conjunction with the purchase of USG which are
being amortized over forty years using the straight-line
method.
Future Policy Benefits
The liability for future policy benefits for traditional
life insurance products has been calculated on a net-level
premium basis. Interest assumptions range from 2.75% for
1956 and prior issues to a 9.00% level, graded to 6.00%
after twenty years for current issues. Mortality, morbidity
and withdrawal assumptions generally are based on actual
experience. These assumptions have been modified to provide
for possible unfavorable deviation from the assumptions.
Future dividends for participating business (which accounted
for 1.7% of premiums and 10.6% of inforce in 1994) are
provided for in the liability for future policy benefits.
With respect to universal life and annuity products, the
Company utilizes the retrospective deposit accounting
method. Policy reserves represent the premiums received
plus accumulated interest, less mortality and administration
charges. Interest credited to these policies ranged from
3.50% to 11.35% during 1994, 4.50% to 10.00% during 1993,
and 4.50% to 9.00% during 1992.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
1. Significant Accounting Policies (continued)
The unearned revenue reserve reflects the unamortized balance of
the excess of first year administration charges over renewal period
administration charges (policy initiation fees) on universal life and
annuity products. These excess charges have been deferred and are
being recognized in income over the period benefited using the same
assumptions and factors used to amortize deferred policy acquisition costs.
Recognition of Premium Revenues and Costs
Traditional life insurance premiums are recognized as
revenues over the premium-paying period. Future policy
benefits and policy acquisition costs are associated with
the premiums as earned by means of the provision for future
policy benefits and amortization of deferred policy
acquisition costs.
Revenues for universal life and annuity products consist of
policy charges for the cost of insurance, renewal period
administration charges, amortization of policy initiation
fees and surrender charges assessed against policyholder
account balances during the period. Expenses related to
these products include interest credited to policyholder
account balances and benefit claims incurred in excess of
policyholder account balances.
Deferred Income Taxes
Deferred tax assets or liabilities are computed based on the
difference between the financial statement and income tax
bases of assets and liabilities using the enacted marginal
tax rate. Deferred income tax expenses or credits are based
on the changes in the asset or liability from period to
period.
Separate Accounts
The transactions in the separate accounts (which are charged
or credited directly to the accounts) are excluded from the
consolidated statements of income.
Dividend Restrictions
The Company's ability to pay dividends to its parent company
is restricted because prior approval of insurance regulatory
authorities is required for payment of dividends to the
stockholder which exceed an annual limitation. During 1995,
the Company could pay dividends to the parent company of
approximately $63,906,000 without prior approval of
statutory authorities. Also, the amount ($241,260,000 at
December 31, 1994) by which the stockholder's equity stated
in conformity with generally accepted accounting principles
exceeds statutory capital and surplus as reported is
restricted and cannot be distributed.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
2. Basis of Financial Reporting
The financial statements of the Company differ from related
statutory financial statements principally as follows: (1)
acquisition costs of acquiring new business are deferred and
amortized over the life of the policies rather than charged
to operations as incurred; (2) future policy benefit
reserves on traditional life insurance products are based on
reasonable assumptions of expected mortality, interest, and
withdrawals which include a provision for possible
unfavorable deviation from such assumptions, which may
differ from reserves based upon statutory mortality rates
and interest; (3) future policy benefit reserves for
universal life and annuity products are based on full
account values, rather than the greater of cash surrender
value or amounts derived from discounting methodologies
utilizing statutory interest rates; (4) reserves are
reported before reduction for reserve credits related to
reinsurance ceded and a receivable is established, net of an
allowance for uncollectible amounts, for these credits
rather than presented net of these credits; (5) a portion of
fixed maturity investments is designated as "available for
sale" and valued at fair value with unrealized
appreciation/depreciation, net of adjustments to deferred
income taxes (if applicable) and deferred policy acquisition
costs, credited/charged directly to stockholder's equity
rather than valued at amortized cost; (6) the carrying value
of fixed maturity securities is reduced to fair value by a
charge to realized losses in the statements of income when
declines in carrying value are judged to be other than
temporary, rather than through the establishment of a
formula-determined statutory investment reserve (carried as
a liability), changes in which are charged directly to
surplus; (7) deferred income taxes are provided for the
difference between the financial statement and income tax
bases of assets and liabilities; (8) net realized gains or
losses attributed to changes in the level of interest rates
in the market are recognized when the sale is completed
rather than deferred and amortized over the remaining life
of the fixed maturity security or mortgage loan; (9) gains
arising from sale lease-back transactions are deferred and
amortized over the life of the lease rather than recognized
in the period of sale; (10) a liability is established for
anticipated guaranty fund assessments, net of estimated premium
tax credits, rather than capitalized when assessed and amortized
in accordance with procedures permitted by insurance
regulatory authorities; (11) a prepaid pension cost asset
established in accordance with SFAS No. 87, "Employers'
Accounting for Pensions", agents' balances and certain other
assets designated as "non-admitted assets" for statutory
purposes are reported as assets rather than being charged to
surplus; (12) revenues for universal life and annuity
products consist of policy charges for the cost of
insurance, policy administration charges, amortization of
policy initiation fees and surrender charges assessed rather
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
2. Basis of Financial Reporting (continued)
than premiums received; (13) expenses for postretirement
benefits other than pensions are recognized for all
qualified employees rather than for only vested and fully-
eligible employees, and the accumulated postretirement
benefit obligation for years prior to adoption of SFAS No.
106, "Employers' Accounting for Postretirement Benefits
Other Than Pensions" was recognized as a cumulative effect
of change in accounting method rather than deferred and
amortized over twenty years, and (14) assets and liabilities
are restated to fair values when a change in ownership
occurs, with provisions for goodwill and other intangible
assets, rather than continuing to be presented at historical
cost.
Net income for the Company, USG and EAIC as determined in
accordance with statutory accounting practices was
$61,421,000 in 1994, $42,182,000 in 1993, and $36,281,000 in
1992. Total statutory capital and surplus were $431,585,000
at December 31, 1994 and $393,351,000 at December 31, 1993.
3. Investment Operations
Realized gains (losses) and unrealized appreciation
(depreciation) on investments are summarized below:
<TABLE>
<CAPTION>
Realized*
_______________________________________
Year ended December 31
1994 1993 1992
_______________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Fixed maturities:
Held for investment $11,364 $44,765 $7,001
Available for sale 7,417 -- --
Equity securities -- -- 2,059
Mortgage loans on real estate (62) (363) --
Real estate 7 14 (254)
Equity investments 971 580 (757)
___________ ___________ ___________
Realized gains on investments $19,697 $44,996 $8,049
=========== =========== ===========
<FN>
*See Note 5 for the income tax effects attributable to realized gains and
losses on investments.
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
<TABLE>
<CAPTION>
Unrealized
_______________________________________
Year ended December 31
1994 1993 1992
_______________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Fixed maturities:
Held for investment ($663,840) $144,409 $59,116
Available for sale (40,597) -- --
Equity securities (206) (33) 773
___________ ___________ ___________
Unrealized appreciation (depre-
ciation) of investments ($704,643) $144,376 $59,889
=========== =========== ===========
</TABLE>
Major categories of net investment income are summarized below:
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Fixed maturities:
Held for investment $406,975 $397,912 $330,590
Available for sale 71,461 -- --
Equity securities 303 45 156
Mortgage loans on real estate 39,117 28,408 22,615
Real estate 3,696 2,696 2,300
Policy loans 9,788 9,838 9,944
Short-term investments 886 933 1,597
Other - net 801 425 1,187
___________ ___________ ___________
533,027 440,257 368,389
Less investment expenses (11,381) (8,213) (7,859)
___________ ___________ ___________
Net investment income $521,646 $432,044 $360,530
=========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
At December 31, 1994 and 1993, the amortized cost, gross unrealized gains and
losses, and estimated market value of the Company's fixed maturity securities
designated as held for investment are as follows:
HELD FOR INVESTMENT
<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
_____________________________________________________
(Dollars in thousands)
<S> <C> <C> <C> <C>
December 31, 1994
U.S. government and
governmental agencies
and authorities:
Mortgage-backed
securities $288,914 $2,971 ($13,949) $277,936
Other 3,980 66 (104) 3,942
States, municipalities
and political
subdivisions 15,557 -- (1,128) 14,429
Foreign governments 10,573 719 -- 11,292
Public utilities 1,231,799 7,148 (99,517) 1,139,430
Investment grade
corporate 1,594,095 33,750 (80,108) 1,547,737
Below investment grade
corporate 223,908 477 (19,074) 205,311
Mortgage-backed
securities 2,024,281 4,389 (170,091) 1,858,579
Redeemable preferred
stocks 691 -- (257) 434
___________ ___________ ___________ ___________
Total held for investment $5,393,798 $49,520 ($384,228) $5,059,090
=========== =========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
HELD FOR INVESTMENT (continued)
<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
_____________________________________________________
(Dollars in thousands)
<S> <C> <C> <C> <C>
December 31, 1993
U.S. government and
governmental agencies
and authorities:
Mortgage-backed
securities $327,195 $22,121 $349,316
Other 3,493 380 3,873
States, municipalities
and political
subdivisions 15,854 700 ($28) 16,526
Foreign governments 10,573 2,580 -- 13,153
Public utilities 1,198,523 75,309 (6,399) 1,267,433
Investment grade
corporate 1,724,879 187,348 (4,529) 1,907,698
Below investment grade
corporate 361,869 14,266 (4,765) 371,370
Mortgage-backed
securities 1,435,129 51,384 (8,971) 1,477,542
Redeemable preferred
stocks 711 -- (264) 447
___________ ___________ ___________ ___________
Total held for investment $5,078,226 $354,088 ($24,956) $5,407,358
=========== =========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
At December 31, 1994, amortized cost, gross unrealized gains
and losses and estimated market value of the Company's fixed
maturity securities designated as available for sale are as
follows:
AVAILABLE FOR SALE
<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
_____________________________________________________
(Dollars in thousands)
<S> <C> <C> <C> <C>
December 31, 1994
U.S. government and
governmental agencies
and authorities:
Mortgage-backed
securities $17,817 ($730) $17,087
Other 30,624 (1,178) 29,446
Public utilities 70,184 $704 (7,173) 63,715
Investment grade
corporate 365,162 9,288 (19,574) 354,876
Below investment grade
corporate 199,597 589 (23,417) 176,769
Mortgage-backed
securities 135,699 1,926 (1,032) 136,593
___________ ___________ ___________ ___________
Total available for sale $819,083 $12,507 ($53,104) $778,486
=========== =========== =========== ===========
</TABLE>
No fixed maturity securities were designated as available
for sale on December 31, 1993. Short-term investments, all
with maturities of 30 days or less, have been excluded from
the above schedules. Amortized cost approximates market
value for these securities.
The amortized cost and estimated market value of fixed
maturity securities at December 31, 1994, by contractual
maturity, are shown below. Expected maturities will differ
from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or
prepayment penalties.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
HELD FOR INVESTMENT
<TABLE>
<CAPTION>
Estimated
Amortized Market
Cost Value
_________________________
(Dollars in thousands)
<S> <C> <C>
Due in one year or less $974 $975
Due after one year through five years 50,130 50,321
Due after five years through ten years 584,859 553,373
Due after ten years 2,444,640 2,317,906
___________ ___________
3,080,603 2,922,575
Mortgage-backed securities 2,313,195 2,136,515
___________ ___________
Total held for investment $5,393,798 $5,059,090
=========== ===========
</TABLE>
AVAILABLE FOR SALE
<TABLE>
<CAPTION>
Estimated
Amortized Market
Cost Value
_________________________
(Dollars in thousands)
<S> <C> <C>
Due after one year through five years $45,252 $43,509
Due after five years through ten years 149,091 140,687
Due after ten years 471,224 440,610
___________ ___________
665,567 624,806
Mortgage-backed securities 153,516 153,680
___________ ___________
Total available for sale $819,083 $778,486
=========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
The carrying value and market value of mortgage-backed
securities, which comprise 40% of the Company's investment
in fixed maturity securities as of December 31, 1994, by
type, are as follows:
<TABLE>
<CAPTION>
Estimated
Carrying Market
Value Value
__________________________
(Dollars in thousands)
<S> <C> <C>
December 31, 1994
Mortgage-backed securities:
Government and agency guaranteed pools:
Very accurately defined maturities $17,178 $16,167
Planned amortization class 79,510 75,774
Targeted amortization class 29,258 25,406
Sequential pay 74,006 69,301
Pass through 106,049 108,375
Private Label CMOs and REMICs:
Very accurately defined maturities 30,386 29,275
Planned amortization class 17,606 17,055
Targeted amortization class 451,412 404,187
Sequential pay 1,593,798 1,482,757
Mezzanines 38,326 35,103
Private placements and subordinate issues 29,346 26,795
___________ ___________
Total mortgage-backed securities $2,466,875 $2,290,195
=========== ===========
</TABLE>
During periods of significant interest rate volatility, the mortgages
underlying mortgage-backed securities may prepay more quickly or more
slowly than anticipated. If the principal amount of such mortgages
are prepaid earlier than anticipated during periods of declining
interest rates, investment income may decline due to reinvestment of
these funds at lower current market rates. If principal repayments
are slower than anticipated during periods of rising interest rates,
increases in investment yield may lag behind increases in interest
rates because funds will remain invested at lower historical rates
rather than reinvested at higher current rates. To mitigate this
prepayment volatility, the Company invests primarily in intermediate
tranche collateralized mortgage obligations ("CMOs"). CMOs are pools
of mortgages that are segregated into sections, or tranches, which
provide sequential retirement of bonds rather than pro-rata share of
principal return in the pass-through structure. The Company does not
hold any "interest only" or "principal only" mortgage-backed securities.
Further, the Company has not purchased obligations at significant
premiums, thereby limiting exposure to loss during periods of
accelerated prepayments. At December 31, 1994, unamortized premiums
on mortgage-backed securities totaled $4,775,000 and unaccrued discounts
on mortgage-backed securities totaled $70,447,000.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
An analysis of sales, maturities and principal repayments of
the Company's fixed maturities portfolio for the years ended
December 31, 1994, 1993 and 1992 is as follows:
<TABLE>
<CAPTION>
Gross Gross Proceeds
Amortized Realized Realized from
Cost Gains Losses Sale
_________________________________________________
(Dollars in thousands)
<S> <C> <C> <C> <C>
Year ended December 31, 1994
Scheduled principal repayments,
calls and tenders (available
for sale only):
Held for investment $275,480 $11,389 ($25) $286,844
Available for sale 167,285 4,877 (11) 172,151
Sales:
Available for sale 29,526 3,184 (14) 32,696
___________ _________ _________ ___________
Total $472,291 $19,450 ($50) $491,691
=========== ========= ========= ===========
Year ended December 31, 1993
Scheduled principal repayments,
calls and tenders $999,855 $50,924 $1,050,779
Sales 5,481 284 5,765
___________ _________ _________ ___________
Total $1,005,336 $51,208 $ -- $1,056,544
=========== ========= ========= ===========
Year ended December 31, 1992
Scheduled principal repayments,
calls and tenders $537,118 $22,332 $559,450
Sales 204,942 5,567 ($17,335) 193,174
___________ _________ _________ ___________
Total $742,060 $27,899 ($17,335) $752,624
=========== ========= ========= ===========
</TABLE>
Effective January 1, 1994, the Company adopted SFAS No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities". The cumulative effect of this change in
accounting method was to increase stockholder's equity by
$22,516,000 at January 1, 1994. The change in unrealized
gain or loss included in stockholder's equity, net of
adjustments from January 1, 1994 (date of adoption of SFAS
No. 115) to December 31, 1994 amounted to $49,009,000 of net
depreciation.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
At December 31, 1994, unrealized appreciation of equity
securities of $2,173,000 is comprised of gross unrealized
appreciation of $2,546,000 and gross unrealized depreciation
of $373,000.
The carrying value of investments which have been non-income
producing for the twelve months preceding December 31, 1994
totaled $239,000 related to one real estate property.
The Company analyzes its investment portfolio at least
quarterly in order to determine if the carrying value of its
investments has been impaired. The carrying value of debt
and equity securities is written down to fair value by a
charge to realized losses when an impairment in value
appears to be other than temporary. Effective January 1,
1994, the Company recognized a pre-tax loss of $619,000 to
write the value of one fixed maturity security down to its
estimated fair value of $80,000 pursuant to the requirements
of SFAS No. 115. During the year ended December 31, 1993,
this security was written down to its estimated net
realizable value of $699,000 by a charge to realized losses
of $6,443,000. This security was sold in the fourth quarter
of 1994 at a nominal gain. During the year ended
December 31, 1992, a pre-tax loss of $3,563,000 was
recognized to write the carrying value of one fixed maturity
investment down to is estimated net realizable value.
During the year ended December 31, 1994, the Company
established valuation allowances of $57,000 on one mortgage
loan and $959,000 on one real estate property to reduce the
carrying value of these investments to their estimated fair
value, less costs to sell. During the year ended
December 31, 1993, the Company recognized a pre-tax loss of
$363,000 to reduce the carrying value of one mortgage loan
(sold in 1994) and established a valuation allowance of
$86,000 on one real estate property to reduce the carrying
value of these investments to their estimated fair value,
less costs to sell. During the year ended December 31,
1992, the Company recognized pre-tax losses of $418,000 on
two real estate properties and $1,347,000 on two equity
method investments, prior to the investments' actual
disposal.
At December 31, 1994, affidavits of deposits covering bonds
with a par value of $1,519,564,000 (1993 - $1,388,913,000),
mortgage loans with an unpaid principal balance of
$225,404,000 (1994 - $188,464,000) and policy loans with an
unpaid balance of $168,653,000 (1993 - $173,097,000) were on
deposit with state agencies to meet regulatory requirements.
In addition, at December 31, 1994, pursuant to a reinsurance
agreement, the Company had investments with a carrying value
of $84,156,000 (market value of $72,637,000) deposited in a
trust for the benefit of the ceding company.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
3. Investment Operations (continued)
The Company's investment policies related to its investment
portfolio require diversification by asset type, company and
industry and set limits on the amounts which can be invested
in an individual issuer. Such policies are at least as
restrictive as those set forth by regulatory authorities.
Fixed maturity investments included investments in various
non-governmental mortgage-backed securities (35% in 1994,
28% in 1993), public utilities (22% in 1994, 24% in
1993), basic industrials (18% in 1994, 20% in 1993), and
consumer products (13% in 1994, 14% in 1993). Mortgage
loans on real estate have been analyzed by geographical
locations. Concentrations of mortgage loans are in
Pennsylvania (10% in 1994, 7% in 1993), Illinois (9% in
1994, 10% in 1993), and California (8% in 1994, 10% in
1993). There are no significant concentrations of mortgage
loans in any other state or region. Mortgage loans on real
estate have also been analyzed by collateral type with
significant concentrations identified in retail facilities
(33% in 1994 and 1993), industrial buildings (25% in 1994,
28% in 1993), multi-family residential buildings (25% in
1994, 19% in 1993), and office buildings (15% in 1994 and
1993). Equity securities, real estate and investments
accounted for by the equity method are not significant to
the Company's overall investment portfolio.
No investment in any person or its affiliates (other than
bonds issued by agencies of the United States government)
exceeded ten percent of stockholder's equity at December 31,
1994.
4. Fair Values of Financial Instruments
SFAS No. 107, "Disclosures about Fair Value of Financial
Instruments", requires disclosure of estimated fair value of
all financial instruments, including both assets and
liabilities recognized and not recognized in a Company's
balance sheet, unless specifically exempted. SFAS No. 119,
"Disclosure about Derivative Financial Instruments and Fair
Value of Financial Instruments" requires additional
disclosures about derivative financial instruments. Most of
the Company's investments, insurance liabilities and debt,
as well as off-balance sheet items such as loan guarantees,
fall within the standards' definition of a financial
instrument. Although the Company's life insurance
liabilities are specifically exempted from this disclosure
requirement, estimated fair value disclosure of these
liabilities is also provided in order to make the
disclosures more meaningful. Accounting, actuarial and
regulatory bodies are continuing to study the methodologies
to be used in developing fair value information,
particularly as it relates to such things as liabilities for
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
4. Fair Values of Financial Instruments (continued)
insurance contracts. Accordingly, care should be exercised
in deriving conclusions about the Company's business or
financial condition based on the information presented
herein.
The Company closely monitors the level of its insurance
liabilities, the level of interest rates credited to its
interest-sensitive products and the assumed interest margin
provided for within the pricing structure of its other
products. These amounts are taken into consideration in the
Company's overall management of interest rate risk, which
attempts to minimize exposure to changing interest rates
through the matching of investment cash flows with amounts
expected to be due under insurance contracts. In addition,
the Company is not currently a party to any financial
instruments such as futures, forward, swap or option
contracts, or other financial instruments with similar
characteristics. As such, the Company believes that it has
reduced the volatility inherent in its "fair value" adjusted
stockholder's equity, although such volatility will not be
reduced completely. As discussed below, the Company has
used discount rates in its determination of fair values for
its liabilities which are consistent with market yields for
related assets. The use of the asset market yield is
consistent with management's opinion that the risks inherent
in its asset and liability portfolios are similar. This
assumption, however, might not result in values that are
consistent with those obtained through an actuarial
appraisal of the Company's business or values that might
arise in a negotiated transaction.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
4. Fair Values of Financial Instruments (continued)
The following compares carrying values as shown for
financial reporting purposes with estimated fair values:
<TABLE>
<CAPTION>
December 31, 1994 December 31, 1993
_____________________________________________________
Estimated Estimated
Carrying Market Carrying Market
Value Value Value Value
___________ ___________ ___________ ___________
(Dollars in thousands)
<S> <C> <C> <C> <C>
Assets
Balance sheet financial assets:
Held for investment $5,393,798 $5,059,090 $5,078,226 $5,407,358
Available for sale 778,486 778,486 -- --
Equity securities of
unaffiliated company 22,978 22,978 83 83
Equity security of
affiliated company 3,164 3,164 3,794 3,794
Mortgage loans on real
estate 610,185 586,333 343,732 373,560
Short-term investments 45,796 45,796 58,090 58,090
Cash and cash equivalents 11,830 11,830 4,476 4,476
Notes and other
receivables 119,261 119,261 109,906 109,906
Separate account assets 84,963 84,963 94,028 94,028
___________ ___________ ___________ ___________
7,070,461 6,711,901 5,692,335 6,051,295
Off-balance-sheet financial asset:
Unrecognized pension
asset -- -- -- 7,960
Deferred policy acquisition
costs and intangible
assets 610,118 -- 453,746 --
Non-financial assets 93,524 93,524 88,478 88,478
___________ ___________ ___________ ___________
Total assets $7,774,103 $6,805,425 $6,234,559 $6,147,733
=========== =========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
4. Fair Values of Financial Instruments (continued)
<TABLE>
<CAPTION>
December 31, 1994 December 31, 1993
_____________________________________________________
Estimated Estimated
Carrying Market Carrying Market
Value Value Value Value
___________ ___________ ___________ ___________
(Dollars in thousands)
<S> <C> <C> <C> <C>
Liabilities and stockholder's equity
Liabilities:
Future policy benefits (net of related policy loans):
Universal life and
current interest
products $390,061 $258,852 $345,592 $207,364
Annuity products 5,718,888 4,312,559 4,337,968 3,676,263
Participating life insur-
ance and dividend
accumulations 580,043 377,577 572,597 452,010
Traditional life insurance
- nonpar 166,227 114,193 162,253 135,900
___________ ___________ ___________ ___________
6,855,219 5,063,181 5,418,410 4,471,537
Separate account
liabilities 84,963 84,963 94,028 94,028
___________ ___________ ___________ ___________
6,940,182 5,148,144 5,512,438 4,565,565
Off-balance-sheet financial liability:
Unrecognized pension
obligation -- 3,298 -- --
Deferred income taxes on fair
value adjustments -- 287,894 -- 301,914
Non-financial liabilities 161,076 161,076 121,870 121,870
___________ ___________ ___________ ___________
Total liabilities 7,101,258 5,600,412 5,634,308 4,989,349
Stockholder's equity 672,845 1,205,013 600,251 1,158,384
___________ ___________ ___________ ___________
Total liabilities and
stockholder's equity $7,774,103 $6,805,425 $6,234,559 $6,147,733
=========== =========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
4. Fair Values of Financial Instruments (continued)
The following methods and assumptions were used by the
Company in estimating fair values:
Fixed maturities: Estimated market values of publicly
traded securities are reported by an independent pricing
service. Market values of conventional mortgage-backed
securities not actively traded in a liquid market are
estimated using a third party pricing system, which uses a
matrix calculation assuming a spread over U. S. Treasury
bonds based upon the expected average lives of the securities.
Market values of private placement bonds are estimated using
a matrix that assumes a spread (based on interest rates and
a risk assessment of the bonds) over U. S. Treasury bonds.
Estimated market values of redeemable preferred stocks are as
reported by the NAIC.
Equity securities: Estimated fair values are based upon
the latest quoted market prices, where available. For
equity securities not actively traded, estimated fair
values are based upon values of issues of comparable
yield and quality.
Mortgage loans on real estate: Fair values are estimated
by discounting expected cash flows, using interest rates
currently being offered for similar loans.
Short-term investments, cash and cash equivalents and notes
and other receivables: Carrying values reported in the
Company's historical cost basis balance sheet approximate
estimated fair value for these instruments, due to their
short-term nature.
Separate account assets and liabilities: Separate
account assets and liabilities are reported at estimated
fair value in the Company's historical cost basis balance
sheet.
Future policy benefits: Estimated fair values of the
Company's liabilities for future policy benefits for
universal life and current interest products, annuity
products, participating life insurance and dividend
accumulations and non-par traditional life insurance
products are based upon discounted cash flow
calculations. Cash flows of future policy benefits are
discounted using the market yield rate of the assets
supporting these liabilities. Estimated fair values are
presented net of the estimated fair value of
corresponding policy loans due to the interdependent
nature of the cash flows associated with these items.
Deferred policy acquisition costs and intangible assets:
For historical cost purposes, the recovery of policy
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
4. Fair Values of Financial Instruments (continued)
acquisition costs is based on the realization, among
other things, of future interest spreads and gross
premiums on in-force business. Because these cash flows
are considered in the computation of the future policy
benefit cash flows, the deferred policy acquisition cost
balance does not appear on the estimated fair value
balance sheet. Intangible assets do not appear in the
estimated fair value balance sheet because there are no
cash flows related to these assets.
Off-balance-sheet instruments: Estimated fair values of
the Company's unrecognized pension assets or obligations
are based upon amounts not recognized in the financial
statement pension accruals.
Derivative financial instruments: SFAS No. 119 requires
disclosures about derivative financial instruments such
as futures, forward, swap or option contracts, or other
financial instruments with similar characteristics. The
Company was not a party to such derivative financial
instruments at any time during 1994.
Deferred income taxes on fair value adjustments:
Deferred income taxes have been reported at the statutory
rate for the differences (except for those attributed to
permanent differences) between the carrying value and
estimated fair value of assets and liabilities set forth
herein.
Non-financial assets and liabilities: Values are
presented at historical cost.
SFAS No. 107 and SFAS No. 119 require disclosure of estimated fair value
information about financial instruments, whether or not recognized in the
consolidated balance sheet, for which it is practicable to estimate that
value. In cases where quoted market prices are not available, estimated
fair values are based on estimates using present value or other valuation
techniques. Those techniques are significantly affected by the assumptions
used, including the discount rate and estimates of future cash flows. In
that regard, the derived fair value estimates cannot be substantiated by
comparison to independent markets and, in many cases, could not be realized
in immediate settlement of the instrument. The above presentation should
not be viewed as an appraisal as there are several factors, such as the fair
value associated with customer or agent relationships and other intangible
items, which have not been considered. In addition, interest rates and other
assumptions might be modified if an actual appraisal were to be performed.
Accordingly, the aggregate estimated fair value amounts presented herein are
limited by each of these factors and do not purport to represent the
underlying value of the Company.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
5. Income Taxes
The Company and all of its subsidiaries file a consolidated
federal income tax return with its parent company. The
parent company and its subsidiaries each report current
income tax expense as allocated under a consolidated tax
allocation agreement. Taxes payable (receivable) to/from
the parent under this agreement were $(9,487,000) and
$7,832,000 at December 31, 1994 and 1993, respectively.
Generally, this allocation results in profitable companies
recognizing a tax provision as if the individual company
filed a separate return and loss companies recognizing
benefits to the extent their losses contribute to reduce
consolidated taxes. Deferred income taxes have been
established by each member of the consolidated group based
upon the temporary differences, the reversal of which will
result in taxable or deductible amounts in future years when
the related asset or liability is recovered or settled,
within each entity.
Income tax expenses (credits) are included in the
consolidated financial statements as follows:
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Taxes provided in consolidated statements of income on:
Income before equity income (loss)
and cumulative effect of change
in accounting principles:
Current $43,357 $53,650 $24,164
Deferred 9,905 (3,181) 5,396
___________ ___________ ___________
53,262 50,469 29,560
Equity income (loss):
Current (65) 25 (45)
Deferred 52 43 14
___________ ___________ ___________
(13) 68 (31)
Cumulative effect of change in
accounting principles - deferred -- -- (2,274)
___________ ___________ ___________
$53,249 $50,537 $27,255
=========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
5. Income Taxes (continued)
Income tax expense (credits) attributed to realized gains
and losses on investments amounted to $6,744,000,
$15,749,000 and $167,000 for the years ended December 31,
1994, 1993 and 1992, respectively. The effective tax rate
on income before income taxes, equity income (loss), and
cumulative effect of change in accounting principles is
different from the prevailing federal income tax rate as
follows:
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_______________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Income before income taxes, equity
income (loss), and cumulative
effect of change in accounting
principles $153,224 $143,640 $93,751
Income tax at federal statutory rate 53,628 50,274 31,875
Tax effect (decrease) of:
Taxes provided for IRS examinations -- 200 200
Change in valuation allowance on
deferred income tax assets,
excluding impact on unrealized
depreciation on equity securities -- -- (2,544)
Other items (366) (5) 29
___________ ___________ ___________
Income tax expense $53,262 $50,469 $29,560
=========== =========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
5. Income Taxes (continued)
The Internal Revenue Service ("IRS") is currently examining
the parent company's consolidated income tax returns for
1990 and 1991. The 1992 and 1993 consolidated income tax
returns remain open to examination. Management believes
amounts provided for IRS examination are adequate to settle
any adjustments raised by the IRS. The tax effect of
temporary differences giving rise to the Company's deferred
income tax assets at December 31, 1994 and 1993, is as
follows:
<TABLE>
<CAPTION>
December 31
1994 1993
_________________________
(Dollars in thousands)
<S> <C> <C>
Deferred tax assets:
Writedowns of investments not
currently deductible for tax $2,255
Net unrealized depreciation of available for sale
fixed maturity securities $14,339 --
Future policy benefits 187,609 149,193
Accrued dividends 4,397 4,515
Guaranty fund assessment accruals 5,557 5,258
Other 8,534 9,820
___________ ___________
220,436 171,041
Deferred tax liabilities:
Deferred policy acquisition costs (192,061) (143,809)
Prepaid pension costs (10,434) (9,306)
Other (6,904) (6,520)
___________ ___________
(209,399) (159,635)
Valuation allowance, for amounts attributable
to net unrealized depreciation for assets
available for sale (9,403) --
___________ ___________
Deferred income tax asset $1,634 $11,406
=========== ===========
</TABLE>
A valuation allowance of $9,403,000 has been established to
offset the deferred tax asset related to the unrealized
depreciation of assets held in the available for sale
account at December 31, 1994.
Prior to 1984, a portion of the Company's current income was
not subject to current income taxation, but was accumulated,
for tax purposes, in a memorandum account designated as
"policyholders' surplus account". The aggregate
accumulation in this account at December 31, 1994 was
$14,388,000. Should the policyholders' surplus account of
the Company exceed the limitation prescribed by federal
income tax law, or should distributions be made by the
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
5. Income Taxes (continued)
Company to the parent company in excess of $292,045,000,
such excess would be subject to federal income taxes at
rates then effective. Deferred income taxes of $5,036,000
have not been provided on amounts included in this
memorandum account since the Company contemplates no action
and can foresee no events that would create such a tax.
Deferred income taxes (credits) were also reported on equity
income and on the loss from discontinued operations during
these periods. These taxes arise from the recognition of
income and losses differently for purposes of filing federal
income tax returns than for financial reporting purposes.
6. Employee Stock Compensation and Retirement Plans
Certain key employees of the Company participate in stock
incentive plans sponsored by Equitable of Iowa Companies,
which provide for the award of stock options or shares of
stock of Equitable of Iowa Companies through three means:
qualified incentive stock options (as defined in the
Internal Revenue Code), non-qualified stock options and
restricted shares. The non-qualified stock options are
compensatory, and require the accrual of compensation
expense over the period of service from the date the options
are granted until they become fully exercisable if market
values exceed the option price on the measurement date.
During the years ended December 31, 1994, 1993 and 1992,
compensation expense of $15,000, $78,000 and $61,000,
respectively, was recognized related to these options.
The Company also awards restricted common stock of Equitable
of Iowa Companies to certain key employees. These shares
are subject to forfeiture to Equitable of Iowa Companies
should the individuals terminate their relationship with the
Company for reasons other than death, permanent disability
or change in company control prior to full vesting. Shares
granted to key employees generally vest on the fifth
anniversary of grant. The Company amortizes as compensation
expense the market value on date of grant of restricted
stock using the straight-line method over the vesting
periods. Compensation expense recognized during the years
ended December 31, 1994, 1993 and 1992 aggregated $696,000,
$450,000 and $154,000, respectively.
The Company also participates in a discretionary stock award
plan under which employees are awarded shares of Equitable
of Iowa Companies' stock for superior performance. During
the years ended December 31, 1994, 1993 and 1992, awards of
495, 580 and 760 shares of stock resulted in charges to
income of $16,000, $15,000 and $8,000, respectively.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
6. Employee Stock Compensation and Retirement Plans (continued)
The Company sponsors a long-term incentive compensation plan which allows
certain agents to earn units equal to shares of Equitable of Iowa Companies'
common stock based on personal production and the maintenance of specific
levels of assets under management. At December 31, 1994 and 1993, the
Company held 112,000 shares of common stock of Equitable of Iowa Companies,
with a market value of $3,164,000 and $3,794,000, respectively (cost
- - $618,000), to provide for projected distributions based on current
performance levels, under this plan. This program resulted in charges to
(income)/expense of $(129,000), $926,000 and $855,000 in the years ended
December 31, 1994, 1993 and 1992, respectively.
Substantially all full-time employees of the Company are covered by a
non-contributory self-insured defined benefit pension plan. The benefits
are based on years of service and the employee's compensation during the last
five years of employment. Further, the parent sponsors a supplemental
defined benefit plan to provide benefits in excess of amounts allowed
pursuant to Internal Revenue Code Section 401(a)(17) and those allowed due
to integration rules. The Company's funding policy with respect to the plan
is consistent with the funding requirements of federal law and regulations.
The following table sets forth the plan's funded status and amounts
recognized in the Company's consolidated balance sheet:
<TABLE>
<CAPTION>
December 31
1994 1993
________________________
(Dollars in thousands)
<S> <C> <C>
Accumulated benefit obligation, including vested
benefits of $45,788 in 1994 and $47,193 in 1993 $46,534 $48,057
=========== ===========
Plan assets at fair value, primarily bonds, common
stocks (including 400,000 shares of the Equitable
of Iowa Companies' common stock), mortgage loans
and short-term investments $78,120 $88,956
Projected benefit obligation for service rendered
to date 51,778 54,446
___________ ___________
Plan assets in excess of projected benefit obligation 26,342 34,510
Unrecognized net (gain)/loss from past experience
different from that assumed and effects of
changes in assumptions 7,002 (5,804)
Prior service cost not yet recognized 760 671
Unrecognized net asset at the transition
date, net of amortization (3,456) (2,792)
___________ ___________
Prepaid pension cost $30,648 $26,585
=========== ===========
</TABLE>
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
6. Employee Stock Compensation and Retirement Plans (continued)
Net periodic pension benefit included the following components:
<TABLE>
<CAPTION>
Year ended December 31
1994 1993 1992
_____________________________________
(Dollars in thousands)
<S> <C> <C> <C>
Actual return on plan assets ($7,681) $13,647 $11,224
Service cost-benefits earned during
the period (1,221) (935) (733)
Interest cost on projected benefit
obligation (3,867) (3,623) (2,849)
Net amortization and deferral 16,761 (4,932) (4,173)
___________ ___________ ___________
Net periodic pension benefit $3,992 $4,157 $3,469
=========== =========== ===========
</TABLE>
The weighted-average discount rate and rate of increase in
future compensation levels used in determining the actuarial
present value of the projected benefit obligation were 8.0%
and 5.0%, respectively, at December 31, 1994, and 7.0% and
5.0%, respectively, at December 31, 1993. The average
expected long-term rate of return on plan assets was 8.0% in
1994 and 8.5% in 1993 and 1992.
In addition to the Company's defined benefit pension plan,
the Company sponsors plans that provide postretirement
medical and group term life insurance benefits to full-time
employees and agents who have worked five years and attained
age 55 as of January 1, 1992. The medical plans are
contributory, with retiree contributions adjusted annually,
and contain other cost-sharing features such as deductibles
and coinsurance. The accounting for these plans anticipates
that the Company's contributions will increase annually by
the lesser of the health care inflation rate or 3%, with
increases in excess of these amounts borne by the employee
or agent. All costs for group term life insurance benefits
are funded on a pay-as-you-go (cash) basis by the Company.
In 1992, the Company adopted SFAS No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions".
The Company elected to recognize the accumulated
postretirement benefit obligation as of January 1, 1992, as
a one-time charge to earnings which has been treated as a
cumulative effect of change in accounting principle. The
cumulative effect adjustment aggregated $4,415,000, after a
deferred tax benefit of $2,274,000 and is reflected in the
1992 consolidated statement of income.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
6. Employee Stock Compensation and Retirement Plans (continued)
The Company has chosen not to fund any amounts in excess of
current benefits. The following table sets forth the
amounts recognized in the Company's consolidated balance
sheet:
<TABLE>
<CAPTION>
December 31
1994 1993
___________________
(Dollars in thousands)
<S> <C> <C>
Accumulated postretirement benefit obligation:
Retirees $5,228 $5,248
Fully eligible active plan participants 1,186 1,249
Other active plan participants 1,314 1,945
_________ _________
Accumulated postretirement benefit obligation
in excess of plan assets 7,728 8,442
Prior service cost not yet recognized in net
postretirement benefit cost 483 --
Unrecognized net gain (100) (612)
_________ _________
Accrued postretirement benefit cost $8,111 $7,830
========= =========
</TABLE>
Net periodic postretirement benefit costs include the
following components:
<TABLE>
<CAPTION>
Year ended December 31
_____________________________
1994 1993 1992
_____________________________
(Dollars in thousands)
<S> <C> <C> <C>
Service cost $292 $271 $211
Interest cost 564 544 499
Net amortization of prior service cost and
amortization of unrecognized loss (32) -- --
_________ _________ _________
Net periodic postretirement benefit cost $824 $815 $710
========= ========= =========
</TABLE>
The weighted-average annual assumed rate of increase in the per capita cost
of health care benefits (i.e., health care cost trend rate) used in
determining the actuarial present value of the accumulated postretirement
benefit obligation was 13.5% at December 31, 1994 and 14.5% at December 31,
1993 for employees under 65 and 9.0% at December 31, 1994 and 9.5% at
December 31, 1993 for employees over 65, with the rates for both groups to
be graded down to 5.5% for 2005 and thereafter. The health care cost trend
rate assumption has a significant effect on the amounts reported. For
example, increasing the assumed health care trend rates by
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
6. Employee Stock Compensation and Retirement Plans (continued)
one percent would increase the accumulated postretirement
benefit obligation as of December 31, 1994 by $664,000 and
net periodic postretirement benefit costs for the year ended
December 31, 1994 by $109,000. The weighted-average
discount rate used in determining the accumulated
postretirement benefit obligation was 8.0% at December 31,
1994 and 7.0% at December 31, 1993.
The Company also sponsors an unfunded deferred compensation
plan providing benefits to certain former employees. The
Company recognized expense (benefit) of $(38,000), $(44,000)
and $21,000 during the years ended December 31, 1994, 1993
and 1992, respectively, in connection with this plan.
The Company sponsors pension plans for its employees which
are qualified under Internal Revenue Code Section 401(k).
Employees may contribute a portion of their annual salary,
subject to limitation, to the plans. The Company
contributes an additional amount, subject to limitation,
based on the voluntary contribution of the employee.
Company contributions charged to expense with respect to
these plans during the years ended December 31, 1994, 1993
and 1992 were $289,000, $259,000 and $175,000, respectively.
The Company has non-contributory self-insured defined
contribution pension plans for its agents. Contributions
charged to expense under these plans during the years ended
December 31, 1994, 1993 and 1992 amounted to $389,000,
$566,000 and $596,000, respectively.
Certain of the assets related to these plans are on deposit
with the Company and amounts relating to these plans are
included in these consolidated financial statements.
7. Contingencies and Commitments
In the normal course of business, the Company seeks to limit
its exposure to loss on any single insured and to recover a
portion of benefits paid by ceding reinsurance to other
insurance enterprises or reinsurers. Reinsurance coverages
for life insurance vary according to the age and risk
classification of the insured with retention limits ranging
up to $500,000 of coverage per individual life. The Company
does not use financial or surplus relief reinsurance. At
December 31, 1994, life insurance in force ceded on a
consolidated basis amounted to $1,421,608,000, or
approximately 14.0% of total life insurance in force.
Reinsurance contracts do not relieve the Company of its
obligations to its policyholders. To the extent that
reinsuring companies are later unable to meet obligations
under reinsurance agreements, the Company would be liable
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
7. Contingencies and Commitments (continued)
for these obligations, and payment of these obligations
could result in losses to the Company. To limit the
possibility of such losses, the Company evaluates the
financial condition of its reinsurers, monitors
concentrations of credit risk arising from factors such as
similar geographic regions, and limits its exposure to any
one reinsurer. At December 31, 1994, the Company had
reinsurance treaties with 18 reinsurers, all of which are
deemed to be long-duration, retroactive contracts, and has
established a receivable totaling $11,986,000 for reserve
credits, reinsurance claims and other receivables from these
reinsurers. No allowance for uncollectible amounts has been
established since none of the receivables are deemed to be
uncollectible, and because such receivables, either
individually or in the aggregate, are not material to the
Company's operations. The Company's liability for future
policy benefits and notes and other receivables have been
increased by $9,871,000 at December 31, 1994 for reserve
credits on reinsured policies. This "gross-up" of
assets and liabilities for reserve credits on reinsurance
had no impact on the Company's net income. Insurance
premiums and product charges have been reduced by
$5,916,000, $5,653,000 and $5,845,000 and insurance benefits
have been reduced by $5,310,000, $3,498,000 and $3,554,000
in 1994, 1993 and 1992, respectively, as a result of the
cession agreements. The amount of reinsurance assumed is
not significant.
Assessments are, from time to time, levied on the Company by
life and health guaranty associations in most states in
which the Company is licensed to cover losses of
policyholders of insolvent or rehabilitated insurers. In
some states, these assessments can be partially recovered
through a reduction in future premium taxes. Based upon
information currently available, the Company believes that
it is probable that these insolvencies will result in future
assessments which will be material to the Company's
financial statements. The Company regularly reviews its
reserve for these insolvencies and updates its reserve based
on new information or as new insolvencies occur.
Accordingly, the Company accrued and charged to expense an
additional $1,763,000 and $2,109,000 during 1994 and 1993,
respectively. At December 31, 1994, the Company has
reserved $15,597,000 to cover estimated future assessments
(net of related anticipated premium tax credits) and has
established an asset totaling $11,096,000 for items expected
to be recoverable through future premium tax offsets. The
Company cannot predict whether and to what extent
legislative initiatives may affect the right to offset.
Equitable Life Insurance Company of Iowa
Notes to Consolidated Financial Statements (continued)
7. Contingencies and Commitments (continued)
The Company leases its home office space and certain other
equipment under operating leases which expire through 1999.
During the years ended December 31, 1994, 1993 and 1992,
rent expense totaled $1,995,000, $1,769,000 and $1,922,000,
respectively. At December 31, 1994, minimum rental payments
due under all non-cancelable operating leases with initial
terms of one year or more are: 1995 - $2,091,000; 1996 -
$1,826,000; 1997 - $1,485,000; 1998 - $1,408,000; and 1999 -
$231,000.
At December 31, 1994, outstanding commitments to fund
mortgage loans on real estate totaled $49,304,000. In
addition, outstanding commitments to purchase mortgage-
backed securities totaled $16,572,000 at December 31, 1994.
8. Related Party Transactions
The Company purchases investment management services from an
affiliate. Payments for these services aggregated
$6,734,000, $5,317,000 and $5,052,000 during the years ended
December 31, 1994, 1993 and 1992, respectively.
Additionally, the Company maintains a line of credit
agreement with Equitable of Iowa Companies to facilitate the
handling of unusual and/or unanticipated short-term cash
requirements. Under the current agreement, which expires on
December 31, 1995, the Company can borrow up to $140
million. Interest on any outstanding borrowings is charged
at a rate of Equitable of Iowa Companies' monthly average
aggregate cost of short-term funds plus 1.00%. At
December 31, 1994, no amounts were outstanding under the
line of credit.
Equitable Life Insurance Company of Iowa
SCHEDULE I
SUMMARY OF INVESTMENTS
OTHER THAN INVESTMENTS IN RELATED PARTIES
(Dollars in thousands)
<TABLE>
<CAPTION>
Balance
Sheet
December 31, 1994 Cost 1 Value Amount
_______________________________________________________________________________
<S> <C> <C> <C>
TYPE OF INVESTMENT
Fixed maturities, held for investment:
Bonds:
United States Government and governmental
agencies and authorities $292,894 $281,878 $292,894
States, municipalities and
political subdivisions 15,557 14,429 15,557
Foreign governments 10,573 11,292 10,573
Public utilities 1,231,799 1,139,430 1,231,799
Investment grade corporate 1,594,095 1,547,737 1,594,095
Below investment grade corporate 223,908 205,311 223,908
Mortgage-backed securities 2,024,281 1,858,579 2,024,281
Redeemable preferred stocks 691 434 691
___________ ___________ ___________
Total fixed maturities, held for
investment 5,393,798 5,059,090 5,393,798
Fixed maturities, available for sale:
Bonds:
United States Government and governmental
agencies and authorities 48,441 46,533 46,533
Public utilities 70,184 63,715 63,715
Investment grade corporate 365,162 354,876 354,876
Below investment grade corporate 199,597 176,769 176,769
Mortgage-backed securities 135,699 136,593 136,593
___________ ___________ ___________
Total fixed maturities, available
for sale 819,083 778,486 778,486
Equity securities:
Common stocks:
Affiliates 618 3,164 3,164
Industrial, miscellaneous and
all other 23,351 22,978 22,978
___________ ___________ ___________
Total equity securities 23,969 26,142 26,142
Mortgage loans on real estate 610,185 610,185
Real estate:
Investment properties 3,904 3,904
Acquired in satisfaction of debt 11,764 11,764
___________ ___________
Total real estate 15,668 15,668
Policy loans 176,448 176,448
Short-term investments 45,796 45,796
___________ ___________
Total investments $7,084,947 $7,046,523
=========== ===========
<FN>
Note 1: Except as stated in Note 2 below, cost is defined as original cost
for stocks and other invested assets, amortized cost for bonds and
unpaid principal for policy loans and mortgage loans on real estate,
adjusted for amortization of premiums, accrual of discounts and
cost less allowances for depreciation for real estate.
Note 2: Original cost and amortized cost of investments have been adjusted
to reflect other than temporary declines in value by charges to
income as follows. Mortgage loans on real estate: 1994 - $57,000.
Real estate: $959,000; 1991 - $123,000 and 1990 $992,000.
</TABLE>
Equitable Life Insurance Company of Iowa
SCHEDULE III
SUPPLEMENTARY INSURANCE INFORMATION
(Dollars in thousands)
<TABLE>
<CAPTION>
Column Column Column Column Column Column
A B C D E F
_______________________________________________________________________________
Future
Policy Other
De- Benefits, Policy
ferred Losses, Claims Insur-
Policy Claims Un- and ance
Acqui- and earned Bene- Premiums
sition Loss Revenue fits and
Segment Costs Expenses Reserve Payable Charges
_______________________________________________________________________________
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1994:
Life insurance $607,626 $7,014,207 $14,317 $7,785 $90,032
Year ended December 31, 1993:
Life insurance 451,180 5,578,085 14,451 5,765 81,151
Year ended December 31, 1992:
Life insurance 356,105 4,403,513 12,899 3,310 73,434
</TABLE>
<TABLE>
<CAPTION>
Column Column Column Column Column Column
A G H I J K
_______________________________________________________________________________
Amorti-
Benefits zation
Claims, of
Losses Deferred
Net and Policy Other
Invest- Settle- Acqui- Opera-
ment ment sitions ting Premiums
Segment Income Expenses Costs Expenses Written
_______________________________________________________________________________
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1994:
Life insurance $521,646 $414,450 $50,921 $17,128 --
Year ended December 31, 1993:
Life insurance 432,044 358,172 42,078 20,185 --
Year ended December 31, 1992:
Life insurance 360,530 316,026 20,176 18,179 --
</TABLE>
Equitable Life Insurance Company of Iowa
SCHEDULE IV
REINSURANCE
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E Column F
________________________________________________________________________________
Percentage
Ceded to Assumed of Amount
Gross Other from Other Net Assumed
Amount Companies Companies Amount to Net
________________________________________________________________________________
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1994:
Life insurance in
force $10,146,940 $1,421,608 $ -- $8,725,332 --
============ ============ ========= =========== ==========
Insurance premiums
and charges $95,821 $5,916 $127 $90,032 --
============ ============ ========= =========== ==========
Year ended December 31, 1993:
Life insurance in
force $9,617,881 $1,326,020 $ -- $8,291,861 --
============ ============ ========= =========== ==========
Insurance premiums
and charges $86,615 $5,653 $189 $81,151 --
============ ============ ========= =========== ==========
Year ended December 31, 1992:
Life insurance in
force $8,927,326 $1,242,003 $ -- $7,685,323 --
============ ============ ========= =========== ==========
Insurance premiums
and charges $78,639 $5,845 $640 $73,434 1%
============ ============ ========= =========== ==========
</TABLE>
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Money
Market
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694) $5,708,694
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 5,708,694
Accrued investment income 23,527
____________
TOTAL NET ASSETS $5,732,221
============
NET ASSETS REPRESENTED BY:
Units 548,767
Unit Value 10.45
____________
Net Assets $5,732,221
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Mortgage-
Backed
Securites
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777) $4,104,533
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 4,104,533
Accrued investment income 234,987
____________
TOTAL NET ASSETS $4,339,520
============
NET ASSETS REPRESENTED BY:
Units 380,031
Unit Value 11.42
____________
Net Assets $4,339,520
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Fixed
Income
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258) $3,439,156
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
______________
TOTAL INVESTMENTS 3,439,156
Accrued investment income 160,411
______________
TOTAL NET ASSETS $3,599,567
==============
NET ASSETS REPRESENTED BY:
Units 311,689
Unit Value 11.55
______________
Net Assets $3,599,567
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
OTC
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055) $9,042,595
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 9,042,595
Accrued investment income 994,102
____________
TOTAL NET ASSETS $10,036,697
============
NET ASSETS REPRESENTED BY:
Units 759,597
Unit Value 13.21
____________
Net Assets $10,036,697
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Research
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800) $16,172,693
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 16,172,693
Accrued investment income 274,255
____________
TOTAL NET ASSETS $16,446,948
============
NET ASSETS REPRESENTED BY:
Units 1,255,752
Unit Value 13.10
____________
Net Assets $16,446,948
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Total
Return
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627) $15,492,400
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 15,492,400
Accrued investment income 329,442
____________
TOTAL NET ASSETS $15,821,842
============
NET ASSETS REPRESENTED BY:
Units 1,312,565
Unit Value 12.05
____________
Net Assets $15,821,842
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Advantage
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548) $3,499,215
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 3,499,215
Accrued investment income 245,022
____________
TOTAL NET ASSETS $3,744,237
============
NET ASSETS REPRESENTED BY:
Units 344,775
Unit Value 10.86
____________
Net Assets $3,744,237
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Government
Securities
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887) $583,367
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
____________
TOTAL INVESTMENTS 583,367
Accrued investment income 77,967
____________
TOTAL NET ASSETS $661,334
============
NET ASSETS REPRESENTED BY:
Units 56,258
Unit Value 11.76
____________
Net Assets $661,334
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Stock
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698) $5,490,993
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138)
______________
TOTAL INVESTMENTS 5,490,993
Accrued investment income 227,777
______________
TOTAL NET ASSETS $5,718,770
==============
NET ASSETS REPRESENTED BY:
Units 541,570
Unit Value 10.56
______________
Net Assets $5,718,770
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
EQUI-SELECT PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Short-Term
Bond
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
5,708,694 shares at $1.00 per share (cost - $5,708,694)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
378,660 shares at $10.84 per share (cost - $4,182,777)
Equi-Select Series Trust International Fixed Income Portfolio,
310,243 shares at $11.09 per share (cost - $3,405,258)
Equi-Select Series Trust OTC Portfolio,
748,553 shares at $12.08 per share (cost - $9,015,055)
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Equi-Select Series Trust Total Return Portfolio,
1,301,515 shares at $11.90 per share (cost - $14,460,627)
Equi-Select Series Trust Advantage Portfolio,
343,572 shares at $10.18 per share (cost - $3,599,548)
Equi-Select Series Trust Government Securities Portfolio,
55,971 shares at $10.42 per share (cost - $603,887)
Equi-Select Series Trust International Stock Portfolio,
541,371 shares at $10.14 per share (cost - $5,412,698)
Equi-Select Series Trust Short-Term Bond Portfolio,
31,925 shares at $10.09 per share (cost - $332,138) $322,215
____________
TOTAL INVESTMENTS 322,215
Accrued investment income 29,396
____________
TOTAL NET ASSETS $351,611
============
NET ASSETS REPRESENTED BY:
Units 32,032
Unit Value 10.98
____________
Net Assets $351,611
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
EQUI-SELECT PRODUCT
For the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Mortgage-
Money Backed
Market Securities
Account Account
______________ ______________
<S> <C> <C>
INVESTMENT INCOME
Income:
Dividends $173,300 $192,773
Capital gains distributions -- 42,213
Expenses (Note 2):
Annual contract charges (74) (97)
Administrative charges (5,092) (1,928)
Mortality and expense
risk charges (42,199) (15,980)
______________ ______________
Net investment income 125,935 216,981
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain on
investments -- 994
Net unrealized appreciation
(depreciation) of
investments -- (77,915)
______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $125,935 $140,060
============== ==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
EQUI-SELECT PRODUCT
For the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Fixed
Income OTC Research
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME
Income:
Dividends $139,030 -- $39,906
Capital gains distribution 33,016 $994,102 234,349
Expenses (Note 2):
Annual contract charges (107) (579) (558)
Administrative charges (2,366) (6,510) (8,999)
Mortality and expense
risk charges (19,614) (53,955) (74,579)
______________ ______________ ______________
Net investment income (loss) 149,959 933,058 190,119
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain on
investments 4,271 36,066 19,662
Net unrealized appreciation
(depreciation) of
investments 34,190 20,313 1,548,017
______________ ______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $188,420 $989,437 $1,757,798
============== ============== ==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
EQUI-SELECT PRODUCT
For the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Total Government
Return Advantage Securities
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME
Income:
Dividends $265,808 $243,949 $50,921
Capital gains distribution 63,634 1,219 27,115
Expenses (Note 2):
Annual contract charges (737) (174) (18)
Administrative charges (8,853) (2,721) (1,074)
Mortality and expense
risk charges (73,376) (22,550) (8,900)
______________ ______________ ______________
Net investment income (loss) 246,476 219,723 68,044
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain on
investments 6,083 15,065 57,031
Net unrealized appreciation
(depreciation) of
investments 1,034,214 (96,273) (20,436)
______________ ______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $1,286,773 $138,515 $104,639
============== ============== ==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
EQUI-SELECT PRODUCT
For the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International Short-Term
Stock Bond
Account Account
______________ ______________
<S> <C> <C>
INVESTMENT INCOME
Income:
Dividends $93,741 $26,296
Capital gains distributions 134,583 3,120
Expenses (Note 2):
Annual contract charges (433) (29)
Administrative charges (4,069) (466)
Mortality and expense
risk charges (33,726) (3,860)
______________ ______________
Net investment income (loss) 190,096 25,061
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain on
investments 9,684 11,985
Net unrealized appreciation
(depreciation) of
investments 79,172 (9,796)
______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $278,952 $27,250
============== ==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Money
Market
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $1,504
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net increase (decrease) in net assets resulting from operations 1,504
Changes from principal transactions:
Purchase payments 947,439
Contract distributions and terminations --
Transfer payments from (to) other Accounts (603,444)
______________
Increase in net assets derived from principal transactions 343,995
______________
Total increase 345,499
______________
NET ASSETS AT DECEMBER 31, 1994 345,499
INCREASE IN NET ASSETS
Operations:
Net investment income 125,935
Net realized gain on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net increase in net assets resulting from operations 125,935
Changes from principal transactions:
Purchase payments 30,141,356
Contract distributions and terminations (18,210)
Transfer payments from (to) other Accounts (22,930,581)
Transfer payments from (to) Fixed Account and other Funds (1,931,778)
______________
Increase in net assets derived from principal transactions 5,260,787
______________
Total increase 5,386,722
______________
NET ASSETS AT DECEMBER 31, 1995 $5,732,221
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Mortgage-
Backed
Securities
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $414
Net realized gain (loss) on investments 3
Net unrealized appreciation (depreciation) of investments (329)
______________
Net increase (decrease) in net assets resulting from operations 88
Changes from principal transactions:
Purchase payments 8,983
Contract distributions and terminations --
Transfer payments from (to) other Accounts 19,751
______________
Increase in net assets derived from principal transactions 28,734
______________
Total increase 28,822
______________
NET ASSETS AT DECEMBER 31, 1994 28,822
INCREASE IN NET ASSETS
Operations:
Net investment income 216,981
Net realized gain on investments 994
Net unrealized appreciation (depreciation) of investments (77,915)
______________
Net increase in net assets resulting from operations 140,060
Changes from principal transactions:
Purchase payments 1,764,376
Contract distributions and terminations (7,691)
Transfer payments from (to) other Accounts 2,246,463
Transfer payments from (to) Fixed Account and other Funds 167,490
______________
Increase in net assets derived from principal transactions 4,170,638
______________
Total increase 4,310,698
______________
NET ASSETS AT DECEMBER 31, 1995 $4,339,520
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Fixed
Income
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $342
Net realized gain (loss) on investments 3
Net unrealized appreciation (depreciation) of investments (292)
______________
Net increase (decrease) in net assets resulting from operations 53
Changes from principal transactions:
Purchase payments 21,572
Contract distributions and terminations --
Transfer payments from (to) other Accounts 29,663
______________
Increase in net assets derived from principal transactions 51,235
______________
Total increase 51,288
______________
NET ASSETS AT DECEMBER 31, 1994 51,288
INCREASE IN NET ASSETS
Operations:
Net investment income 149,959
Net realized gain on investments 4,271
Net unrealized appreciation (depreciation) of investments 34,190
______________
Net increase in net assets resulting from operations 188,420
Changes from principal transactions:
Purchase payments 1,703,537
Contract distributions and terminations (6,355)
Transfer payments from (to) other Accounts 1,593,333
Transfer payments from (to) Fixed Account and other Funds 69,344
______________
Increase in net assets derived from principal transactions 3,359,859
______________
Total increase 3,548,279
______________
NET ASSETS AT DECEMBER 31, 1995 $3,599,567
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
OTC
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) ($908)
Net realized gain (loss) on investments (66)
Net unrealized appreciation (depreciation) of investments 7,227
______________
Net increase (decrease) in net assets resulting from operations 6,253
Changes from principal transactions:
Purchase payments 585,144
Contract distributions and terminations --
Transfer payments from (to) other Accounts 68,709
______________
Increase in net assets derived from principal transactions 653,853
______________
Total increase 660,106
______________
NET ASSETS AT DECEMBER 31, 1994 660,106
INCREASE IN NET ASSETS
Operations:
Net investment income 933,058
Net realized gain on investments 36,066
Net unrealized appreciation (depreciation) of investments 20,313
______________
Net increase in net assets resulting from operations 989,437
Changes from principal transactions:
Purchase payments 4,028,128
Contract distributions and terminations (33,765)
Transfer payments from (to) other Accounts 4,236,805
Transfer payments from (to) Fixed Account and other Funds 155,986
______________
Increase in net assets derived from principal transactions 8,387,154
______________
Total increase 9,376,591
______________
NET ASSETS AT DECEMBER 31, 1995 $10,036,697
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Research
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $4,874
Net realized gain (loss) on investments (3)
Net unrealized appreciation (depreciation) of investments (20,124)
______________
Net increase (decrease) in net assets resulting from operations (15,253)
Changes from principal transactions:
Purchase payments 635,302
Contract distributions and terminations (50)
Transfer payments from (to) other Accounts 52,604
______________
Increase in net assets derived from principal transactions 687,856
______________
Total increase 672,603
______________
NET ASSETS AT DECEMBER 31, 1994 672,603
INCREASE IN NET ASSETS
Operations:
Net investment income 190,119
Net realized gain on investments 19,662
Net unrealized appreciation (depreciation) of investments 1,548,017
______________
Net increase in net assets resulting from operations 1,757,798
Changes from principal transactions:
Purchase payments 8,333,228
Contract distributions and terminations (32,130)
Transfer payments from (to) other Accounts 4,960,660
Transfer payments from (to) Fixed Account and other Funds 754,789
______________
Increase in net assets derived from principal transactions 14,016,547
______________
Total increase 15,774,345
______________
NET ASSETS AT DECEMBER 31, 1995 $16,446,948
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Total
Return
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $2,657
Net realized gain (loss) on investments (37)
Net unrealized appreciation (depreciation) of investments (2,441)
______________
Net increase (decrease) in net assets resulting from operations 179
Changes from principal transactions:
Purchase payments 198,999
Contract distributions and terminations --
Transfer payments from (to) other Accounts 125,747
______________
Increase in net assets derived from principal transactions 324,746
______________
Total increase 324,925
______________
NET ASSETS AT DECEMBER 31, 1994 324,925
INCREASE IN NET ASSETS
Operations:
Net investment income 246,476
Net realized gain on investments 6,083
Net unrealized appreciation (depreciation) of investments 1,034,214
______________
Net increase in net assets resulting from operations 1,286,773
Changes from principal transactions:
Purchase payments 7,285,539
Contract distributions and terminations (72,501)
Transfer payments from (to) other Accounts 6,787,996
Transfer payments from (to) Fixed Account and other Funds 209,110
______________
Increase in net assets derived from principal transactions 14,210,144
______________
Total increase 15,496,917
______________
NET ASSETS AT DECEMBER 31, 1995 $15,821,842
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Advantage
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $4,252
Net realized gain (loss) on investments 166
Net unrealized appreciation (depreciation) of investments (4,060)
______________
Net increase (decrease) in net assets resulting from operations 358
Changes from principal transactions:
Purchase payments 225,148
Contract distributions and terminations --
Transfer payments from (to) other Accounts 233,518
______________
Increase in net assets derived from principal transactions 458,666
______________
Total increase 459,024
______________
NET ASSETS AT DECEMBER 31, 1994 459,024
INCREASE IN NET ASSETS
Operations:
Net investment income 219,723
Net realized gain on investments 15,065
Net unrealized appreciation (depreciation) of investments (96,273)
______________
Net increase in net assets resulting from operations 138,515
Changes from principal transactions:
Purchase payments 1,956,116
Contract distributions and terminations (15,339)
Transfer payments from (to) other Accounts 1,159,684
Transfer payments from (to) Fixed Account and other Funds 46,237
______________
Increase in net assets derived from principal transactions 3,146,698
______________
Total increase 3,285,213
______________
NET ASSETS AT DECEMBER 31, 1995 $3,744,237
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Government
Securities
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $166
Net realized gain (loss) on investments 1
Net unrealized appreciation (depreciation) of investments (84)
______________
Net increase (decrease) in net assets resulting from operations 83
Changes from principal transactions:
Purchase payments 14,453
Contract distributions and terminations --
Transfer payments from (to) other Accounts (100)
______________
Increase in net assets derived from principal transactions 14,353
______________
Total increase 14,436
______________
NET ASSETS AT DECEMBER 31, 1994 14,436
INCREASE IN NET ASSETS
Operations:
Net investment income 68,044
Net realized gain on investments 57,031
Net unrealized appreciation (depreciation) of investments (20,436)
______________
Net increase in net assets resulting from operations 104,639
Changes from principal transactions:
Purchase payments 932,770
Contract distributions and terminations (17,843)
Transfer payments from (to) other Accounts (357,771)
Transfer payments from (to) Fixed Account and other Funds (14,897)
______________
Increase in net assets derived from principal transactions 542,259
______________
Total increase 646,898
______________
NET ASSETS AT DECEMBER 31, 1995 $661,334
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Stock
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $1,275
Net realized gain (loss) on investments (74)
Net unrealized appreciation (depreciation) of investments (877)
______________
Net increase (decrease) in net assets resulting from operations 324
Changes from principal transactions:
Purchase payments 159,544
Contract distributions and terminations (50)
Transfer payments from (to) other Accounts 73,652
______________
Increase in net assets derived from principal transactions 233,146
______________
Total increase 233,470
______________
NET ASSETS AT DECEMBER 31, 1994 233,470
INCREASE IN NET ASSETS
Operations:
Net investment income 190,096
Net realized gain on investments 9,684
Net unrealized appreciation (depreciation) of investments 79,172
______________
Net increase in net assets resulting from operations 278,952
Changes from principal transactions:
Purchase payments 2,770,444
Contract distributions and terminations (57,092)
Transfer payments from (to) other Accounts 2,444,365
Transfer payments from (to) Fixed Account and other Funds 48,631
______________
Increase in net assets derived from principal transactions 5,206,348
______________
Total increase 5,485,300
______________
NET ASSETS AT DECEMBER 31, 1995 $5,718,770
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
EQUI-SELECT PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the year ended December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Short-Term
Bond
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $129
Net realized gain (loss) on investments 2
Net unrealized appreciation (depreciation) of investments (127)
______________
Net increase (decrease) in net assets resulting from operations 4
Changes from principal transactions:
Purchase payments 11,675
Contract distributions and terminations --
Transfer payments from (to) other Accounts (100)
______________
Increase in net assets derived from principal transactions 11,575
______________
Total increase 11,579
______________
NET ASSETS AT DECEMBER 31, 1994 11,579
INCREASE IN NET ASSETS
Operations:
Net investment income 25,061
Net realized gain on investments 11,985
Net unrealized appreciation (depreciation) of investments (9,796)
______________
Net increase in net assets resulting from operations 27,250
Changes from principal transactions:
Purchase payments 431,525
Contract distributions and terminations (9,551)
Transfer payments from (to) other Accounts (140,954)
Transfer payments from (to) Fixed Account and other Funds 31,762
______________
Increase in net assets derived from principal transactions 312,782
______________
Total increase 340,032
______________
NET ASSETS AT DECEMBER 31, 1995 $351,611
==============
<FN>
* Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
EQUI-SELECT PRODUCT
NOTES TO FINANCIAL STATEMENTS
December 31, 1995 (Unaudited)
NOTE 1 - INVESTMENT AND ACCOUNTING POLICIES
Equitable Life Insurance Company of Iowa Separate Account A was organized
by Equitable Life Insurance Company of Iowa (the "Company") in accordance
with the provisions of Iowa Insurance laws and is a part of the total
operations of the Company. The assets and liabilities of the Equitable
Life Insurance Company of Iowa Separate Account A are clearly identified
and distinguished from the other assets and liabilities of the Company.
Equitable Life Insurance Company of Iowa Separate Account A commenced
operations on October 7, 1994 with the initial sale of contract units to
contract owners. Investments are stated at the closing net asset values
per share on December 31, 1995.
Equitable Life Insurance Company of Iowa Separate Account A consists of
fourteen investment accounts, ten of which (the Money Market, Mortgage-
Backed Securities, International Fixed Income, OTC, Research, Total
Return, Advantage, Government Securities, International Stock and Short-
Term Bond) are invested in specified portfolios of the Equi-Select Series
Trust, an open-end series management investment company under the
Investment Company Act of 1940, as directed by eligible contract owners.
Activity in these ten investment accounts is available to contract owners
of the Equi-Select Variable Annuity product.
The remaining four investment accounts are invested in specified
portfolios of the Smith Barney/Travelers Series Fund Inc. These four
investment accounts and the Research Account, which invests in the Equi-
Select Series Trust, are available to contract owners of the PrimElite
Variable Annuity product.
The financial statements included herein present only those investment
accounts available to contract owners of the Equi-Select Variable Annuity
product. The financial statements of the remaining investment accounts
and the Research Account available to contract owners of the PrimElite
Variable Annuity product are presented separately.
The average cost method is used to determine realized gains and losses.
Dividends are taken into income on an accrual basis as of the ex-dividend
date.
NOTE 2 - EXPENSES
The Company is compensated for mortality and expense risks and
administrative costs by a charge equivalent to an annual rate of 1.25%
and 0.15%, respectively, of the total net assets of each Account. These
charges amounted to $348,739 and $42,078, respectively, for the year
ended December 31, 1995 ($3,241 and $391, respectively, for the period
ended December 31, 1994).
An annual contract charge of $30 is deducted on each contract anniversary
prior to the maturity date, upon full withdrawal of a contract's value or
upon commencement of annuity payments if such withdrawal is made or
annuity payments commence on a date other than the contract anniversary.
During 1995, annual contract charges amounted to $2,806. No annual
contract charges were assessed in 1994.
NOTE 2 - EXPENSES (continued)
A transfer charge computed as the lesser of 2% of the contract value
transferred or $25 will be imposed on each transfer between Accounts in
excess of twelve in any one calendar year. A withdrawal charge
may be imposed in the event of withdrawal of any portion of the contract
value or upon annuitization. The withdrawal charge is 8% of the amount
withdrawn prior to the first anniversary of the purchase payment and
reduces by 1% at each subsequent purchase payment anniversary.
NOTE 3 - FEDERAL INCOME TAXES
Operations of the Equitable Life Insurance Company of Iowa Separate
Account A form a part of the operations of the Company which is taxed as
a life insurance company under the Internal Revenue Code. Under current
law, no federal income taxes are payable with respect to operations of
Equitable Life Insurance Company of Iowa Separate Account A.
NOTE 4 - PURCHASES AND SALES OF INVESTMENT SECURITIES
The aggregate cost of purchases and proceeds from sales of investments
were as follows:
<TABLE>
<CAPTION>
Period From
Year Ended October 7, 1994 to
December 31, 1995 December 31, 1994
_________________________ _________________________
Purchases Sales Purchases Sales
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Money Market Portfolio $18,116,828 $12,751,952 $759,639 $415,821
Mortgage-Backed Securities
Portfolio 4,186,979 33,921 29,782 1,060
International Fixed
Income Portfolio 3,461,113 111,334 52,990 1,785
OTC Portfolio 8,736,489 410,391 654,619 1,662
Research Portfolio 14,168,762 230,594 687,042 69
Total Return Portfolio 14,267,685 137,651 325,895 1,348
Advantage Portfolio 3,718,744 592,976 535,350 76,801
Government Securities
Portfolio 1,537,791 1,005,281 14,453 108
International Stock
Portfolio 5,388,124 218,038 234,384 1,382
Short-Term Bond Portfolio 683,300 374,720 11,675 104
</TABLE>
NOTE 5 - SUMMARY OF CHANGES FROM UNIT TRANSACTIONS
Transactions in units were as follows:
<TABLE>
<CAPTION>
Period From
Year Ended October 7, 1994 to
December 31, 1995 December 31, 1994
_________________________ _________________________
Purchases Sales Purchases Sales
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Money Market Account 2,969,444 2,454,999 101,861 67,539
Mortgage-Backed Securities
Account 380,372 3,227 2,896 10
International Fixed
Income Account 309,796 3,205 5,135 37
OTC Account 705,565 9,749 63,781 --
Research Account 1,196,506 9,931 69,182 5
Total Return Account 1,315,204 35,745 33,106 --
Advantage Account 359,214 59,955 53,240 7,724
Government Securities
Account 224,515 169,685 1,438 10
International Stock
Account 535,682 17,774 23,667 5
Short-Term Bond Account 65,845 34,954 1,151 10
</TABLE>
NOTE 6 - NET ASSETS
Net assets at December 31, 1995 consisted of the following:
<TABLE>
<CAPTION>
Mortgage- International
Money Backed Fixed
Market Securities Income OTC
Account Account Account Account
____________ _____________ ____________ _____________
<S> <C> <C> <C> <C>
Unit transactions $5,708,819 $4,200,698 $3,415,456 $9,076,800
Accumulated net
investment income 23,402 217,066 150,213 932,357
Net unrealized appreciation
(depreciation) of
investments -- (78,244) 33,898 27,540
____________ _____________ ____________ _____________
$5,732,221 $4,339,520 $3,599,567 $10,036,697
============ ============= ============ =============
</TABLE>
<TABLE>
<CAPTION>
Total
Research Return Advantage
Account Account Account
____________ _____________ ____________
<S> <C> <C> <C>
Unit transactions $14,724,226 $14,542,050 $3,620,601
Accumulated net
investment income 194,829 248,019 223,969
Net unrealized appreciation
(depreciation) of
investments 1,527,893 1,031,773 (100,333)
____________ _____________ ____________
$16,446,948 $15,821,842 $3,744,237
============ ============= ============
</TABLE>
<TABLE>
<CAPTION>
Government International Short-Term
Securities Stock Bond
Account Account Account
____________ _____________ ____________
<S> <C> <C> <C>
Unit transactions $636,052 $5,450,703 $343,325
Accumulated net
investment income 45,802 189,772 18,209
Net unrealized appreciation
(depreciation) of
investments (20,520) 78,295 (9,923)
____________ _____________ ____________
$661,334 $5,718,770 $351,611
============ ============= ============
</TABLE>
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
PRIMELITE PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Research
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800) $16,172,693
Smith Barney/Travelers Series Fund Inc.
Smith Barney International Equity Portfolio,
167,157 shares at $10.68 per share (cost - $1,753,674)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Income and Growth Portfolio,
276,435 shares at $12.86 per share (cost - $3,366,536)
Smith Barney/Travelers Series Fund Inc.
Smith Barney High Income Portfolio,
71,320 shares at $11.09 per share (cost - $791,011)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Money Market Portfolio,
1,277,892 shares at $1.00 per share (cost - $1,277,892)
____________
TOTAL INVESTMENTS 16,172,693
Accrued investment income 274,255
____________
TOTAL NET ASSETS $16,446,948
============
NET ASSETS REPRESENTED BY:
Units 1,255,752
Unit Value 13.10
____________
Net Assets $16,446,948
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
PRIMELITE PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Equity
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Smith Barney/Travelers Series Fund Inc.
Smith Barney International Equity Portfolio,
167,157 shares at $10.68 per share (cost - $1,753,674) $1,785,234
Smith Barney/Travelers Series Fund Inc.
Smith Barney Income and Growth Portfolio,
276,435 shares at $12.86 per share (cost - $3,366,536)
Smith Barney/Travelers Series Fund Inc.
Smith Barney High Income Portfolio,
71,320 shares at $11.09 per share (cost - $791,011)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Money Market Portfolio,
1,277,892 shares at $1.00 per share (cost - $1,277,892)
______________
TOTAL INVESTMENTS 1,785,234
Accrued investment income --
______________
TOTAL NET ASSETS $1,785,234
==============
NET ASSETS REPRESENTED BY:
Units 154,388
Unit Value 11.56
______________
Net Assets $1,785,234
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
PRIMELITE PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Income and
Growth
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Smith Barney/Travelers Series Fund Inc.
Smith Barney International Equity Portfolio,
167,157 shares at $10.68 per share (cost - $1,753,674)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Income and Growth Portfolio,
276,435 shares at $12.86 per share (cost - $3,366,536) $3,554,954
Smith Barney/Travelers Series Fund Inc.
Smith Barney High Income Portfolio,
71,320 shares at $11.09 per share (cost - $791,011)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Money Market Portfolio,
1,277,892 shares at $1.00 per share (cost - $1,277,892)
______________
TOTAL INVESTMENTS 3,554,954
Accrued investment income --
______________
TOTAL NET ASSETS $3,554,954
==============
NET ASSETS REPRESENTED BY:
Units 295,134
Unit Value 12.05
______________
Net Assets $3,554,954
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
PRIMELITE PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
High
Income
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Smith Barney/Travelers Series Fund Inc.
Smith Barney International Equity Portfolio,
167,157 shares at $10.68 per share (cost - $1,753,674)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Income and Growth Portfolio,
276,435 shares at $12.86 per share (cost - $3,366,536)
Smith Barney/Travelers Series Fund Inc.
Smith Barney High Income Portfolio,
71,320 shares at $11.09 per share (cost - $791,011) $790,940
Smith Barney/Travelers Series Fund Inc.
Smith Barney Money Market Portfolio,
1,277,892 shares at $1.00 per share (cost - $1,277,892)
______________
TOTAL INVESTMENTS 790,940
Accrued investment income --
______________
TOTAL NET ASSETS $790,940
==============
NET ASSETS REPRESENTED BY:
Units 72,283
Unit Value 10.94
______________
Net Assets $790,940
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF NET ASSETS
PRIMELITE PRODUCT
December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Money
Market
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Research Portfolio,
1,255,727 shares at $12.88 per share (cost - $14,644,800)
Smith Barney/Travelers Series Fund Inc.
Smith Barney International Equity Portfolio,
167,157 shares at $10.68 per share (cost - $1,753,674)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Income and Growth Portfolio,
276,435 shares at $12.86 per share (cost - $3,366,536)
Smith Barney/Travelers Series Fund Inc.
Smith Barney High Income Portfolio,
71,320 shares at $11.09 per share (cost - $791,011)
Smith Barney/Travelers Series Fund Inc.
Smith Barney Money Market Portfolio,
1,277,892 shares at $1.00 per share (cost - $1,277,892) $1,277,892
______________
TOTAL INVESTMENTS 1,277,892
Accrued investment income 1,633
______________
TOTAL NET ASSETS $1,279,525
==============
NET ASSETS REPRESENTED BY:
Units 125,048
Unit Value 10.23
______________
Net Assets $1,279,525
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
PRIMELITE PRODUCT
For the period January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International Income
Research Equity and Growth
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME (LOSS)
Income:
Dividends $39,906 $2,011 $46,777
Capital gains distributions 234,349 -- 12,711
Expenses (Note 2):
Annual contract charges ($558) -- --
Administrative charges (8,999) (620) (1,381)
Mortality and expense
risk charges (74,579) (5,135) (11,442)
______________ ______________ ______________
Net investment income (loss) 190,119 (3,744) 46,665
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments 19,662 (4) 106
Net unrealized appreciation
(depreciation) of
investments 1,548,017 31,560 188,418
______________ ______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $1,757,798 $27,812 $235,189
============== ============== ==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS
PRIMELITE PRODUCT
For the period January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
High Money
Income Market
Account Account
______________ ______________
<S> <C> <C>
INVESTMENT INCOME
Income:
Dividends $33,656 $12,980
Capital gains distribution -- --
Expenses (Note 2):
Annual contract charges -- --
Administrative charges (298) (364)
Mortality and expense
risk charges (2,475) (3,016)
______________ ______________
Net investment income (loss) 30,883 9,600
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments 20 --
Net unrealized appreciation
(depreciation) of
investments (71) --
______________ ______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $30,832 $9,600
============== ==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
PRIMELITE PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the period from January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Research
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $4,874
Net realized gain (loss) on investments (3)
Net unrealized appreciation (depreciation) of investments (20,124)
______________
Net decrease in net assets resulting from operations (15,253)
Changes from principal transactions:
Purchase payments 635,302
Contract distributions and terminations (50)
Transfer payments from (to) other Accounts 52,604
______________
Increase in net assets derived from principal transactions 687,856
______________
Total increase 672,603
______________
NET ASSETS AT DECEMBER 31, 1994 672,603
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) 190,119
Net realized gain (loss) on investments 19,662
Net unrealized appreciation (depreciation) of investments 1,548,017
______________
Net increase in net assets resulting from operations 1,757,798
Changes from principal transactions:
Purchase payments 8,333,228
Contract distributions and terminations (32,130)
Transfer payments from (to) other Accounts 588,563
Transfer payments from (to) Fixed Account and other Funds 5,126,886
______________
Increase in net assets derived from principal transactions 14,016,547
______________
Total increase 15,774,345
______________
NET ASSETS AT DECEMBER 31, 1995 $16,446,948
==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
PRIMELITE PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the period from January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
International
Equity
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) --
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net decrease in net assets resulting from operations --
Changes from principal transactions:
Purchase payments --
Contract distributions and terminations --
Transfer payments from (to) other Accounts --
______________
Increase in net assets derived from principal transactions --
______________
Total increase --
______________
NET ASSETS AT DECEMBER 31, 1994 --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) ($3,744)
Net realized gain (loss) on investments (4)
Net unrealized appreciation (depreciation) of investments 31,560
______________
Net increase in net assets resulting from operations 27,812
Changes from principal transactions:
Purchase payments 1,444,691
Contract distributions and terminations --
Transfer payments from (to) other Accounts 300,075
Transfer payments from (to) Fixed Account and other Funds 12,656
______________
Increase in net assets derived from principal transactions 1,757,422
______________
Total increase 1,785,234
______________
NET ASSETS AT DECEMBER 31, 1995 $1,785,234
==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
PRIMELITE PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the period from January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Income
and Growth
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) --
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net decrease in net assets resulting from operations --
Changes from principal transactions:
Purchase payments --
Contract distributions and terminations --
Transfer payments from (to) other Accounts --
______________
Increase in net assets derived from principal transactions --
______________
Total increase --
______________
NET ASSETS AT DECEMBER 31, 1994 --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $46,665
Net realized gain (loss) on investments 106
Net unrealized appreciation (depreciation) of investments 188,418
______________
Net increase in net assets resulting from operations 235,189
Changes from principal transactions:
Purchase payments 2,609,690
Contract distributions and terminations (77)
Transfer payments from (to) other Accounts 697,496
Transfer payments from (to) Fixed Account and other Funds 12,656
______________
Increase in net assets derived from principal transactions 3,319,765
______________
Total increase 3,554,954
______________
NET ASSETS AT DECEMBER 31, 1995 $3,554,954
==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
PRIMELITE PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the period from January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
High
Income
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) --
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net decrease in net assets resulting from operations --
Changes from principal transactions:
Purchase payments --
Contract distributions and terminations --
Transfer payments from (to) other Accounts --
______________
Increase in net assets derived from principal transactions --
______________
Total increase --
______________
NET ASSETS AT DECEMBER 31, 1994 --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $30,883
Net realized gain (loss) on investments 20
Net unrealized appreciation (depreciation) of investments (71)
______________
Net increase in net assets resulting from operations 30,832
Changes from principal transactions:
Purchase payments 672,913
Contract distributions and terminations (1,611)
Transfer payments from (to) other Accounts 76,650
Transfer payments from (to) Fixed Account and other Funds 12,156
______________
Increase in net assets derived from principal transactions 760,108
______________
Total increase 790,940
______________
NET ASSETS AT DECEMBER 31, 1995 $790,940
==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
PRIMELITE PRODUCT
For the period from October 7, 1994* through December 31, 1994
and for the period from January 1, 1995 or Commencement of Operations*
through December 31, 1995 (Unaudited)
<TABLE>
<CAPTION>
Money
Market
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) --
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net in net assets resulting from operations --
Changes from principal transactions:
Purchase payments --
Contract distributions and terminations --
Transfer payments from (to) other Accounts --
______________
Increase in net assets derived from principal transactions --
______________
Total increase --
______________
NET ASSETS AT DECEMBER 31, 1994 --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $9,600
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net increase in net assets resulting from operations 9,600
Changes from principal transactions:
Purchase payments 3,007,403
Contract distributions and terminations (13,913)
Transfer payments from (to) other Accounts (1,662,784)
Transfer payments from (to) Fixed Account and other Funds (60,781)
______________
Increase in net assets derived from principal transactions 1,269,925
______________
Total increase 1,279,525
______________
NET ASSETS AT DECEMBER 31, 1995 $1,279,525
==============
<FN>
*Commencement of operations - see Note 1
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
PRIMELITE PRODUCT
NOTES TO FINANCIAL STATEMENTS
December 31, 1995 (Unaudited)
NOTE 1 - INVESTMENT AND ACCOUNTING POLICIES
Equitable Life Insurance Company of Iowa Separate Account A was
organized by Equitable Life Insurance Company of Iowa (the
"Company") in accordance with the provisions of Iowa Insurance
laws and is a part of the total operations of the Company. The
assets and liabilities of the Equitable Life Insurance Company of
Iowa Separate Account A are clearly identified and distinguished
from the other assets and liabilities of the Company.
Commencement of operations is defined as the date of initial sale
of contract units to contract owners. The Equitable Life
Insurance Company of Iowa Separate Account A investment accounts
commenced operations on October 7, 1994 for the Research Account,
March 27, 1995 for the International Equity Account, April 5,
1995 for the Income and Growth Account, April 28, 1995 for the
High Income Account, and May 24, 1995 for the Money Market
Account. Investments are stated at the closing net asset values
per share on December 31, 1995.
Equitable Life Insurance Company of Iowa Separate Account A
consists of fourteen investment accounts, four of which
(International Equity, Income and Growth, High Income, and Money
Market), as directed by eligible contract owners, are invested in
specified portfolios of the Smith Barney/Travelers Series Fund
Inc., an open-end management investment company under the
Investment Company Act of 1940, which commenced operations on
June 16, 1994. Activity in these four investment accounts, as
well as the Research Account, which invests in the Equi-Select
Series Trust, is available to contract owners of the PrimElite
Variable Annuity Product.
The remaining ten investment accounts (including the Research
Account) are invested in specified portfolios of the Equi-Select
Series Trust, which commenced operations on October 4, 1994.
These ten investment accounts are available to contract owners of
the Equi-Select Variable Annuity product.
The financial statements included herein present only those
investment accounts available to contract owners of the PrimElite
Variable Annuity product. The financial statements of the
remaining investment accounts available to contract owners of the
Equi-Select Variable Annuity product are presented separately.
The average cost method is used to determine realized gains and
losses. Dividends are taken into income on an accrual basis as
of the ex-dividend date.
NOTE 2 - EXPENSES
The Company is compensated for mortality and expense risks and
administrative costs by a charge equivalent to an annual rate of
1.25% and 0.15%, respectively, of the total net assets of each
Account. These charges amounted to $96,647 and $11,662,
respectively, during 1995 ($980 and $118, respectively in 1994).
NOTE 2 - EXPENSES (continued)
An annual contract charge of $30 is deducted on each contract
anniversary prior to the maturity date, upon full withdrawal of a
contract's value or upon commencement of annuity payments if such
withdrawal is made or annuity payments commence on a date other
than the contract anniversary. During 1995, annual contract
charges amounted to $558. No annual contract charges were
assessed in 1994.
A transfer charge computed as the lesser of 2% of the contract
value transferred or $25 will be imposed on each transfer between
Accounts in excess of twelve in any one calendar year. A
withdrawal charge may be imposed in the event of withdrawal of
any portion of the contract value or upon annuitization. The
withdrawal charge is 8% of the amount withdrawn prior to the
first anniversary of the purchase payment and reduces by 1% at
each subsequent purchase payment anniversary.
NOTE 3 - FEDERAL INCOME TAXES
Operations of the Equitable Life Insurance Company of Iowa
Separate Account A form a part of the operations of the Company
which is taxed as a life insurance company under the Internal
Revenue Code. Under current law, no federal income taxes are
payable with respect to operations of Equitable Life Insurance
Company of Iowa Separate Account A.
NOTE 4 - PURCHASES AND SALES OF INVESTMENT SECURITIES
The aggregate cost of purchases and proceeds from sales of
investments were as follows:
<TABLE>
<CAPTION>
Period From
January 1, 1995 or
Commencement of Period From
Operations October 7, 1994 to
to December 31, 1995 December 31, 1994
_________________________ _________________________
Purchases Sales Purchases Sales
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Research Portfolio $14,168,762 $230,594 $687,042 $69
International Equity
Portfolio 1,754,791 1,113 -- --
Income and Growth Portfolio 3,373,110 6,680 -- --
High Income Portfolio 792,963 1,972 -- --
Money Market Portfolio 2,614,578 1,336,686 -- --
</TABLE>
NOTE 5 - SUMMARY OF CHANGES FROM UNIT TRANSACTIONS
Transactions in units were as follows:
<TABLE>
<CAPTION>
Period From
January 1, 1995 or
Commencement of Period From
Operations October 7, 1994 to
to December 31, 1995 December 31, 1994
_________________________ _________________________
Purchases Sales Purchases Sales
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Research Account 1,196,506 9,931 69,182 5
International Equity Account 154,388 -- -- --
Income and Growth Account 295,140 6 -- --
High Income Account 72,433 150 -- --
Money Market Account 295,977 170,929 -- --
</TABLE>
NOTE 6 - NET ASSETS
Net assets at December 31, 1995 consisted of the following:
<TABLE>
<CAPTION>
International Income
Research Equity and Growth
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
Unit transactions $14,724,226 $1,757,418 $3,319,871
Accumulated net
investment income (loss) 194,829 (3,744) 46,665
Net unrealized appreciation
(depreciation) of
investments 1,527,893 31,560 188,418
______________ ______________ ______________
$16,446,948 $1,785,234 $3,554,954
============== ============== ==============
</TABLE>
<TABLE>
<CAPTION>
High Money
Income Market
Account Account
______________ ______________
<S> <C> <C>
Unit transactions $760,190 $1,275,454
Accumulated net
investment income (loss) 30,821 4,071
Net unrealized appreciation
(depreciation) of
investments (71) --
______________ ______________
$790,940 $1,279,525
============== ==============
</TABLE>
Report of Independent Auditors
The Board of Directors
Equitable Life Insurance Company of Iowa
We have audited the accompanying statement of assets and liability of
Equitable Life Insurance Company of Iowa Separate Account A
(comprising, respectively, the Money Market, Mortgage-Backed
Securities, International Fixed Income, OTC, Research, Total Return,
Advantage, Government Securities, International Stock and Short-Term
Bond Accounts) as of December 31, 1994, and the related statements of
operations and changes in net assets for the period from October 7,
1994 (commencement of operations) to December 31, 1994. These
financial statements are the responsibility of the Account's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards 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. Our procedures included confirmation of
securities owned as of December 31, 1994, by correspondence with the
transfer agent. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of each of
the respective accounts constituting the Equitable Life Insurance
Company of Iowa Separate Account A at December 31, 1994, and the
results of their operations and the changes in their net assets for
the period from October 7, 1994 to December 31, 1994 in conformity
with generally accepted accounting principles.
/s/ Ernst & Young LLP
Des Moines, Iowa
February 7, 1995
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Combined
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818) $343,818
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725) 28,396
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208) 50,916
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891) 660,118
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970) 666,846
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510) 322,069
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715) 454,655
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346) 14,262
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928) 232,051
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573) 11,446
____________
TOTAL INVESTMENTS (cost - $2,805,684) 2,784,577
Accrued investment income 18,033
____________
TOTAL ASSETS 2,802,610
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 858
____________
NET ASSETS $2,801,752
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Money
Market
Account
____________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818) $343,818
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
____________
TOTAL INVESTMENTS (cost - $2,805,684) 343,818
Accrued investment income 1,812
____________
TOTAL ASSETS 345,630
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 131
____________
NET ASSETS $345,499
============
NET ASSETS REPRESENTED BY:
Units 34,322
Unit Value 10.07
____________
Net Assets $345,499
============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Mortgage-
Backed
Securities
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725) $28,396
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 28,396
Accrued investment income 436
______________
TOTAL ASSETS 28,832
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 10
______________
NET ASSETS $28,822
==============
NET ASSETS REPRESENTED BY:
Units 2,886
Unit Value 9.99
______________
Net Assets $28,822
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
International
Fixed Income
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208) $50,916
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 50,916
Accrued investment income 389
______________
TOTAL ASSETS 51,305
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 17
______________
NET ASSETS $51,288
==============
NET ASSETS REPRESENTED BY:
Units 5,098
Unit Value 10.06
______________
Net Assets $51,288
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
OTC
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891) $660,118
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 660,118
Accrued investment income 198
______________
TOTAL ASSETS 660,316
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 210
______________
NET ASSETS $660,106
==============
NET ASSETS REPRESENTED BY:
Units 63,781
Unit Value 10.35
______________
Net Assets $660,106
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Research
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970) $666,846
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 666,846
Accrued investment income 5,972
______________
TOTAL ASSETS 672,818
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 215
______________
NET ASSETS $672,603
==============
NET ASSETS REPRESENTED BY:
Units 69,177
Unit Value 9.72
______________
Net Assets $672,603
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Total
Return
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510) $322,069
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 322,069
Accrued investment income 2,955
______________
TOTAL ASSETS 325,024
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 99
______________
NET ASSETS $324,925
==============
NET ASSETS REPRESENTED BY:
Units 33,106
Unit Value 9.81
______________
Net Assets $324,925
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Advantage
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715) $454,655
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 454,655
Accrued investment income 4,468
______________
TOTAL ASSETS 459,123
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 99
______________
NET ASSETS $459,024
==============
NET ASSETS REPRESENTED BY:
Units 45,516
Unit Value 10.08
______________
Net Assets $459,024
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Government
Securities
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346) $14,262
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 14,262
Accrued investment income 178
______________
TOTAL ASSETS 14,440
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 4
______________
NET ASSETS $14,436
==============
NET ASSETS REPRESENTED BY:
Units 1,428
Unit Value 10.11
______________
Net Assets $14,436
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
International
Stock
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928) $232,051
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573)
______________
TOTAL INVESTMENTS (cost - $2,805,684) 232,051
Accrued investment income 1,488
______________
TOTAL ASSETS 233,539
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 69
______________
NET ASSETS $233,470
==============
NET ASSETS REPRESENTED BY:
Units 23,662
Unit Value 9.87
______________
Net Assets $233,470
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF ASSETS AND LIABILITY
December 31, 1994
<TABLE>
<CAPTION>
Short-Term
Bond
Account
______________
<S> <C>
ASSETS
Investments at net asset value:
Equi-Select Series Trust Money Market Portfolio,
343,818 shares at $1.00 per share (cost - $343,818)
Equi-Select Series Trust Mortgage-Backed Securities Portfolio,
2,869 shares at $9.90 per share (cost - $28,725)
Equi-Select Series Trust International Fixed Income Portfolio,
5,079 shares at $10.02 per share (cost - $51,208)
Equi-Select Series Trust OTC Portfolio,
63,745 shares at $10.36 per share (cost - $652,891)
Equi-Select Series Trust Research Portfolio,
69,528 shares at $9.59 per share (cost - $686,970)
Equi-Select Series Trust Total Return Portfolio,
32,989 shares at $9.76 per share (cost - $324,510)
Equi-Select Series Trust Advantage Portfolio,
45,549 shares at $9.98 per share (cost - $458,715)
Equi-Select Series Trust Government Securities Portfolio,
1,423 shares at $10.02 per share (cost - $14,346)
Equi-Select Series Trust International Stock Portfolio,
23,823 shares at $9.74 per share (cost - $232,928)
Equi-Select Series Trust Short-Term Bond Portfolio,
1,140 shares at $10.04 per share (cost - $11,573) $11,446
______________
TOTAL INVESTMENTS (cost - $2,805,684) 11,446
Accrued investment income 137
______________
TOTAL ASSETS 11,583
LIABILITY
Payable to Equitable Life Insurance Company of Iowa 4
______________
NET ASSETS $11,579
==============
NET ASSETS REPRESENTED BY:
Units 1,141
Unit Value 10.15
______________
Net Assets $11,579
==============
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF OPERATIONS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Mortgage-
Money Backed
Market Securities
Combined Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME (LOSS)
Income:
Dividends $18,336 $2,116 $436
Capital gains distributions 1 -- --
Expenses (Note 2):
Administrative charges (391) (66) (2)
Mortality and expense
risk charges (3,241) (546) (20)
______________ ______________ ______________
Net investment income 14,705 1,504 414
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments (5) -- 3
Net unrealized appreciation
(depreciation) of
investments (21,107) -- (329)
______________ ______________ ______________
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS ($6,407) $1,504 $88
============== ============== ==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF OPERATIONS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
International
Fixed
Income OTC Research
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME (LOSS)
Income:
Dividends $389 $198 $5,972
Capital gains distribution -- -- --
Expenses (Note 2):
Administrative charges (5) (119) (118)
Mortality and expense
risk charges (42) (987) (980)
______________ ______________ ______________
Net investment income (loss) 342 (908) 4,874
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments 3 (66) (3)
Net unrealized appreciation
(depreciation) of
investments (292) 7,227 (20,124)
______________ ______________ ______________
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $53 $6,253 ($15,253)
============== ============== ==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF OPERATIONS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Total Government
Return Advantage Securities
Account Account Account
______________ ______________ ______________
<S> <C> <C> <C>
INVESTMENT INCOME (LOSS)
Income:
Dividends $2,955 $4,468 $178
Capital gains distribution -- -- --
Expenses (Note 2):
Administrative charges (32) (24) (1)
Mortality and expense
risk charges (266) (192) (11)
______________ ______________ ______________
Net investment income (loss) 2,657 4,252 166
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments (37) 166 1
Net unrealized appreciation
(depreciation) of
investments (2,441) (4,060) (84)
______________ ______________ ______________
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $179 $358 $83
============== ============== ==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF OPERATIONS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
International Short-Term
Stock Bond
Account Account
______________ ______________
<S> <C> <C>
INVESTMENT INCOME (LOSS)
Income:
Dividends $1,488 $136
Capital gains distributions -- 1
Expenses (Note 2):
Administrative charges (23) (1)
Mortality and expense
risk charges (190) (7)
______________ ______________
Net investment income (loss) 1,275 129
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS (NOTE 4)
Net realized gain (loss) on
investments (74) 2
Net unrealized appreciation
(depreciation) of
investments (877) (127)
______________ ______________
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $324 $4
============== ==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Combined
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $14,705
Net realized gain (loss) on investments (5)
Net unrealized appreciation (depreciation) of investments (21,107)
______________
Net increase (decrease) in net assets resulting from operations (6,407)
Changes from principal transactions:
Purchase payments 2,808,259
Contract distributions and terminations (100)
Transfer payments from (to) other Accounts --
______________
Increase in net assets derived from principal transactions 2,808,159
______________
Total increase 2,801,752
______________
NET ASSETS AT DECEMBER 31, 1994 $2,801,752
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Money
Market
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $1,504
Net realized gain (loss) on investments --
Net unrealized appreciation (depreciation) of investments --
______________
Net increase (decrease) in net assets resulting from operations 1,504
Changes from principal transactions:
Purchase payments 947,439
Contract distributions and terminations --
Transfer payments from (to) other Accounts (603,444)
______________
Increase in net assets derived from principal transactions 343,995
______________
Total increase 345,499
______________
NET ASSETS AT DECEMBER 31, 1994 $345,499
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Mortgage-
Backed
Securities
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $414
Net realized gain (loss) on investments 3
Net unrealized appreciation (depreciation) of investments (329)
______________
Net increase (decrease) in net assets resulting from operations 88
Changes from principal transactions:
Purchase payments 8,983
Contract distributions and terminations --
Transfer payments from (to) other Accounts 19,751
______________
Increase in net assets derived from principal transactions 28,734
______________
Total increase 28,822
______________
NET ASSETS AT DECEMBER 31, 1994 $28,822
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
International
Fixed
Income
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $342
Net realized gain (loss) on investments 3
Net unrealized appreciation (depreciation) of investments (292)
______________
Net increase (decrease) in net assets resulting from operations 53
Changes from principal transactions:
Purchase payments 21,572
Contract distributions and terminations --
Transfer payments from (to) other Accounts 29,663
______________
Increase in net assets derived from principal transactions 51,235
______________
Total increase 51,288
______________
NET ASSETS AT DECEMBER 31, 1994 $51,288
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
OTC
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) ($908)
Net realized gain (loss) on investments (66)
Net unrealized appreciation (depreciation) of investments 7,227
______________
Net increase (decrease) in net assets resulting from operations 6,253
Changes from principal transactions:
Purchase payments 585,144
Contract distributions and terminations --
Transfer payments from (to) other Accounts 68,709
______________
Increase in net assets derived from principal transactions 653,853
______________
Total increase 660,106
______________
NET ASSETS AT DECEMBER 31, 1994 $660,106
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Research
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $4,874
Net realized gain (loss) on investments (3)
Net unrealized appreciation (depreciation) of investments (20,124)
______________
Net increase (decrease) in net assets resulting from operations (15,253)
Changes from principal transactions:
Purchase payments 635,302
Contract distributions and terminations (50)
Transfer payments from (to) other Accounts 52,604
______________
Increase in net assets derived from principal transactions 687,856
______________
Total increase 672,603
______________
NET ASSETS AT DECEMBER 31, 1994 $672,603
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Total
Return
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $2,657
Net realized gain (loss) on investments (37)
Net unrealized appreciation (depreciation) of investments (2,441)
______________
Net increase (decrease) in net assets resulting from operations 179
Changes from principal transactions:
Purchase payments 198,999
Contract distributions and terminations --
Transfer payments from (to) other Accounts 125,747
______________
Increase in net assets derived from principal transactions 324,746
______________
Total increase 324,925
______________
NET ASSETS AT DECEMBER 31, 1994 $324,925
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Advantage
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $4,252
Net realized gain (loss) on investments 166
Net unrealized appreciation (depreciation) of investments (4,060)
______________
Net increase (decrease) in net assets resulting from operations 358
Changes from principal transactions:
Purchase payments 225,148
Contract distributions and terminations --
Transfer payments from (to) other Accounts 233,518
______________
Increase in net assets derived from principal transactions 458,666
______________
Total increase 459,024
______________
NET ASSETS AT DECEMBER 31, 1994 $459,024
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Government
Securities
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $166
Net realized gain (loss) on investments 1
Net unrealized appreciation (depreciation) of investments (84)
______________
Net increase (decrease) in net assets resulting from operations 83
Changes from principal transactions:
Purchase payments 14,453
Contract distributions and terminations --
Transfer payments from (to) other Accounts (100)
______________
Increase in net assets derived from principal transactions 14,353
______________
Total increase 14,436
______________
NET ASSETS AT DECEMBER 31, 1994 $14,436
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
International
Stock
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $1,275
Net realized gain (loss) on investments (74)
Net unrealized appreciation (depreciation) of investments (877)
______________
Net increase (decrease) in net assets resulting from operations 324
Changes from principal transactions:
Purchase payments 159,544
Contract distributions and terminations (50)
Transfer payments from (to) other Accounts 73,652
______________
Increase in net assets derived from principal transactions 233,146
______________
Total increase 233,470
______________
NET ASSETS AT DECEMBER 31, 1994 $233,470
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
STATEMENT OF CHANGES IN NET ASSETS
For the period October 7, 1994* through December 31, 1994
<TABLE>
<CAPTION>
Short-Term
Bond
Account
______________
<S> <C>
NET ASSETS AT OCTOBER 7, 1994* --
INCREASE IN NET ASSETS
Operations:
Net investment income (loss) $129
Net realized gain (loss) on investments 2
Net unrealized appreciation (depreciation) of investments (127)
______________
Net increase (decrease) in net assets resulting from operations 4
Changes from principal transactions:
Purchase payments 11,675
Contract distributions and terminations --
Transfer payments from (to) other Accounts (100)
______________
Increase in net assets derived from principal transactions 11,575
______________
Total increase 11,579
______________
NET ASSETS AT DECEMBER 31, 1994 $11,579
==============
<FN>
*Commencement of operations
</TABLE>
See accompanying notes.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS
December 31, 1994
NOTE 1 - INVESTMENT AND ACCOUNTING POLICIES
Equitable Life Insurance Company of Iowa Separate Account A was
organized by Equitable Life Insurance Company of Iowa (the "Company")
in accordance with the provisions of Iowa Insurance laws and is a part
of the total operations of the Company. The assets and liabilities of
the Equitable Life Insurance Company of Iowa Separate Account A are
clearly identified and distinguished from the other assets and
liabilities of the Company. The Equitable Life Insurance Company of
Iowa Separate Account A invests solely in specified portfolios of the
Equi-Select Series Trust, an open-end series management investment
company under the Investment Company Act of 1940, as directed by
eligible contract owners. Investments are stated at the closing net
asset values per share on December 31, 1994.
The average cost method is used to determine realized gains and
losses. Dividends are taken into income on an accrual basis as of the
ex-dividend date.
NOTE 2 - EXPENSES
The Company is compensated for mortality and expense risks and
administrative costs by a charge equivalent to an annual rate of 1.25%
and 0.15%, respectively, of the total net assets of each Account.
These charges amounted to $3,241 and $391 in 1994.
An annual contract administration charge of $30 is deducted on each
contract anniversary prior to the maturity date, upon full withdrawal
of a contract's value or upon commencement of annuity payments if such
withdrawal is made or annuity payments commence on a date other than
the contract anniversary. A transfer charge computed as the lesser of
2% of the contract value transferred or $25 will be imposed on each
transfer between Accounts in excess of twelve in any one calendar
year. A withdrawal charge may be imposed in the event of withdrawal
of any portion of the contract value or upon annuitization. The
withdrawal charge is 8% of the amount withdrawn prior to the first
anniversary of the purchase payment and reduces by 1% at each
subsequent purchase payment anniversary. No withdrawal charges were
assessed in 1994.
NOTE 3 - FEDERAL INCOME TAXES
Operations of the Equitable Life Insurance Company of Iowa Separate
Account A will form a part of the operations of the Company which is
taxed as a life insurance company under the Internal Revenue Code.
Under current law, no federal income taxes are payable with respect to
operations of Equitable Life Insurance Company of Iowa Separate
Account A.
NOTE 4 - PURCHASES AND SALES OF INVESTMENT SECURITIES
The aggregate cost of purchases and proceeds from sales of investments
were as follows:
<TABLE>
<CAPTION>
Period From
October 7, 1994* to
December 31, 1994
_________________________
Purchases Sales
____________ ____________
<S> <C> <C>
Money Market Portfolio $759,639 $415,821
Mortgage-Backed Securities
Portfolio 29,782 1,060
International Fixed
Income Portfolio 52,990 1,785
OTC Portfolio 654,619 1,662
Research Portfolio 687,042 69
Total Return Portfolio 325,895 1,348
Advantage Portfolio 535,350 76,801
Government Securities
Portfolio 14,453 108
International Stock
Portfolio 234,384 1,382
Short-Term Bond Portfolio 11,675 104
____________ ____________
Combined $3,305,829 $500,140
============ ============
<FN>
*Commencement of operations
</TABLE>
NOTE 5 - SUMMARY OF CHANGES FROM UNIT TRANSACTIONS
Transactions in units were as follows:
<TABLE>
<CAPTION>
Period From
October 7, 1994* to
December 31, 1994
_________________________
Purchases Sales
____________ ____________
<S> <C> <C>
Money Market Account 101,861 67,539
Mortgage-Backed Securities
Account 2,896 10
International Fixed
Income Account 5,135 37
OTC Account 63,781 --
Research Account 69,182 5
Total Return Account 33,106 --
Advantage Account 53,240 7,724
Government Securities
Account 1,438 10
International Stock
Account 23,667 5
Short-Term Bond Account 1,151 10
____________ ____________
Combined $355,457 $75,340
============ ============
<FN>
*Commencement of operations
</TABLE>
NOTE 6 - NET ASSETS
Net assets at December 31, 1994 consisted of the following:
<TABLE>
<CAPTION>
Mortgage- International
Money Backed Fixed
Market Securities Income
Combined Account Account Account
____________ ____________ _____________ ____________
<S> <C> <C> <C> <C>
Unit transactions $2,808,154 $343,995 $28,737 $51,238
Accumulated net
investment income (loss) 14,705 1,504 414 342
Net unrealized appreciation
(depreciation) of
investments (21,107) -- (329) (292)
____________ ____________ _____________ ____________
$2,801,752 $345,499 $28,822 $51,288
============ ============ ============= ============
</TABLE>
<TABLE>
<CAPTION>
Total
OTC Research Return Advantage
Account Account Account Account
____________ ____________ _____________ ____________
<S> <C> <C> <C> <C>
Unit transactions $653,787 $687,853 $324,709 $458,832
Accumulated net
investment income (loss) (908) 4,874 2,657 4,252
Net unrealized appreciation
(depreciation) of
investments 7,227 (20,124) (2,441) (4,060)
____________ ____________ _____________ ____________
$660,106 $672,603 $324,925 $459,024
============ ============ ============= ============
</TABLE>
<TABLE>
<CAPTION>
Government International Short-Term
Securities Stock Bond
Account Account Account
____________ ____________ _____________
<S> <C> <C> <C>
Unit transactions $14,354 $233,072 $11,577
Accumulated net
investment income (loss) 166 1,275 129
Net unrealized appreciation
(depreciation) of
investments (84) (877) (127)
____________ ____________ _____________
$14,436 $233,470 $11,579
============ ============ =============
</TABLE>
PART C
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
A. FINANCIAL STATEMENTS
The following financial statements of the Company are included in Part B
hereof:
Unaudited Consolidated Financial Statements:
1. Consolidated Balance Sheet - as of December 31, 1995 (unaudited).
2. Consolidated Statement of Income - for the year ended December 31,
1995 (unaudited).
3. Consolidated Statement of Changes in Stockholder's Equity - for
the year ended December 31, 1995 (unaudited).
4. Consolidated Statement of Cash Flows - for the year ended
December 31, 1995 (unaudited).
Audited Consolidated Financial Statements:
1. Report of Independent Auditors
2. Consolidated Balance Sheets - as of December 31, 1994 and 1993
3. Consolidated Statements of Income - for the years ended December 31,
1994, 1993 and 1992.
4. Consolidated Statements of Changes in Stockholder's Equity - for
the years ended December 31, 1994, 1993 and 1992.
5. Consolidated Statements of Cash Flows - for the years ended December
31, 1994, 1993 and 1992.
6. Notes to Consolidated Financial Statements - December 31, 1994.
Schedules to Consolidated Financial Statements - December 31, 1994:
Schedule I - Summary of Investments Other Than Investment in
Related Parties
Schedule III - Supplementary Insurance Information
Schedule IV - Reinsurance
All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are not required under
the related instructions or are inapplicable and therefore have been omitted.
The following financial statements of the Separate Account are included in
Part B hereof:
Unaudited Financial Statements:
1. Statements of Net Assets - Equi-Select Product - December 31, 1995 -
(unaudited).
2. Statements of Operations - Equi-Select Product - For the year ended
December 31, 1995 - (unaudited).
3. Statements of Changes in Net Assets - Equi-Select Product - For the
period from October 7, 1994 through December 31, 1994 (audited) and for the
year ended December 31, 1995 - (unaudited).
4. Notes to Financial Statements - Equi-Select Product - December 31,
1995 - (unaudited).
5. Statements of Net Assets - PrimElite Product - December 31, 1995 -
(unaudited).
6. Statements of Operations - PrimElite Product - For the period January
1, 1995 or Commencement of Operations through December 31, 1995 - (unaudited).
7. Statements of Changes in Net Assets - PrimElite Product - For the
period from October 7, 1994 through December 31, 1994 (audited) and for the
period from January 1, 1995 or Commencement of Operations through December 31,
1995 - (unaudited).
8. Notes to Financial Statements - PrimElite Product - December 31, 1995
- - (unaudited).
Audited Financial Statements:
1. Report of Independent Auditors.
2. Statements of Assets and Liability - December 31, 1994.
3. Statements of Operations - For the period from October 7, 1994
through December 31, 1994.
4. Statements of Changes in Net Assets - For the period from October 7,
1994 through December 31, 1994.
5. Notes to Financial Statements - December 31, 1994.
B. EXHIBITS
1. Resolution of Board of Directors of the Company authorizing the
establishment of the Separate Account.*
2. Not Applicable.
3. Form of Principal Underwriter's Agreement.*
4. Individual Flexible Purchase Payment Deferred Variable Annuity
Contract.*
5. Application Form.*
6. (i) Copy of Restated Articles of Incorporation of the Company.
(ii) Copy of the Restated Bylaws of the Company.
7. Not Applicable.
8. Form of Fund Participation Agreement.
9. Opinion and Consent of Counsel.
10. Consent of Independent Auditors.
11. Not Applicable.
12. Not Applicable.
13. Calculation of Performance Information.**
14. Company Organizational Chart.*
27. Financial Data Schedule
* Incorporated by reference to Registrant's Form N-4 as filed on May 18, 1994.
**Incorporated by reference to Registrant's Post-Effective Amendment No. 2 as
filed on April 28, 1995.
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
The following are the Executive Officers and Directors of the Company:
<TABLE>
<CAPTION>
<S> <C>
Name and Principal Position and Offices
Business Address with Depositor
- ------------------------ -----------------------------------------
Frederick S. Hubbell President, Chairman of the Board, Chief
604 Locust Street Executive Officer and Director
Des Moines, Iowa 50309
Susan M. Jordan Vice President and Chief Information
604 Locust Street Officer and Director
Des Moines, Iowa 50309
Paul E. Larson Executive Vice President, Chief Financial
604 Locust Street Officer, Assistant Secretary and Director
Des Moines, Iowa 50309
Doug Lourens Assistant Vice President, Corporate
604 Locust Street Actuary and Assistant Secretary
Des Moines, Iowa 50309
Beth B. Neppl Vice President -
604 Locust Street Human Resources and Director
Des Moines, Iowa 50309
Dennis D. Hargens Treasurer
604 Locust Street
Des Moines, Iowa 50309
Paul R. Schlaack Director
604 Locust Street
Des Moines, Iowa 50309
John A. Merriman General Counsel, Secretary
604 Locust Street and Director
Des Moines, Iowa 50309
David A. Terwilliger Vice President, Controller, Assistant
604 Locust Street Treasurer and Assistant Secretary
Des Moines, Iowa 50309
Arthur E. Kent Senior Vice President - Sales and
604 Locust Street Marketing
Des Moines, Iowa 50309
Lawrence V. Durland, Jr. Senior Vice President, Assistant
604 Locust Street Secretary and Director
Des Moines, Iowa 50309
Thomas L. May Senior Vice President - Sales and
604 Locust Street Marketing and Director
Des Moines, Iowa 50309
</TABLE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT
The Company organizational chart is incorporated by reference to Registrant's
Registration Statement (Exhibit 14) as filed on May 18, 1994.
ITEM 27. NUMBER OF CONTRACT OWNERS
As of December 29, 1995, there were 1,428 Qualified Contract Owners and 1,247
Non-Qualified Contract Owners.
ITEM 28. INDEMNIFICATION
The Restated Articles of Incorporation of the Company (Article VII) provide,
in part, that:
Section 1. In the manner and to the fullest extent permitted by the Iowa
Business Corporation Act as the same now exists or may hereafter be amended,
the Corporation shall indemnify directors, officers, employees and agents and
shall pay or reimburse them for reasonable expenses in any proceeding to which
said person is or was a party.
Section 2. A director of this Corporation shall not be personally liable to
the Corporation or its shareholders for monetary damages for breach of
fiduciary duty as a Director, except for liability (i) for any breach of any
duty of the Director of loyalty to the Corporation or its shareholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) for any transaction from which
the Director derived an improper personal benefit, or (iv) under Section
490.833 of the Iowa Business Corporation Act for assenting to or voting for an
unlawful distribution. If Chapter 490 of the Code of Iowa, is subsequently
amended to authorize corporate action further eliminating or limiting personal
liability of directors, then the liability of a director to the Corporation
shall be eliminated or limited to the fullest extent permitted by Chapter 490
of the Code of Iowa, as so amended. Any repeal or modification of the
provisions of this Article shall not adversely affect any right or protection
of a director of the Corporation existing at the time of such repeal or
modification.
The Restated Bylaws of the Company (Article VI, Section 2) provide that:
Any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceedings, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or enterprise, shall be
indemnified to the following extent and under the following circumstances:
(a) In an action, suit or proceeding other than an action by or in the
right of the Corporation, such person shall be indemnified against expenses
(including attorney's fees), judgments, fines, and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably believed
to be in the best interests of the Corporation, in the case of conduct in his
official capacity with the Corporation, or, in all other cases, at least not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, if he had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding
judgment, order, settlement, conviction or upon a plea of nolo contendere or
its equivalent shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his
conduct was unlawful.
(b) In an action, suit or proceedings by or in the right of the
Corporation, notwithstanding any provision precluding liability in the
Articles of Incorporation, such person shall nonetheless be indemnified
against expenses (including attorney's fees) actually and reasonably incurred
by him in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in the
best interests of the Corporation, in the case of conduct in his official
capacity with the Corporation, or, in all other cases, at least not opposed to
the best interests of the Corporation, except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the
performance of his duty to the Corporation unless and only to the extent that
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability, but in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such court shall deem proper.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted directors and officers or controlling persons of the
Company pursuant to the foregoing, or otherwise, the Company has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Company will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
ITEM 29. PRINCIPAL UNDERWRITERS
(a) Not Applicable.
(b) Equitable of Iowa Securities Network, Inc. ("Securities Network") is the
principal underwriter for the Contracts. The following persons are the
officers and directors of Securities Network. The principal business address
for each officer and director of Securities Network is 604 Locust Street, Des
Moines, Iowa 50309.
<TABLE>
<CAPTION>
<S> <C>
Name and Principal Positions and Offices
Business Address with Underwriter
- ------------------------ -------------------------------------
William L. Lowe President
Lawrence V. Durland, Jr. Director
Frederick S. Hubbell Director
Paul E. Larson Director
Edward J. Berkson Vice President
Thomas L. May Director
John A. Merriman Director and Secretary
Paul R. Schlaack Director
Merlyn P. Schwickerath Treasurer
Susan M. Jordan Director
Beth B. Neppl Director
Richard L. Bailey Vice President and Compliance Officer
</TABLE>
(c) Not Applicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
David A. Terwilliger, Vice President and Controller, whose address is 604
Locust Street, Des Moines, Iowa 50309, maintains physical possession of the
accounts, books or documents of the Separate Account required to be maintained
by Section 31(a) of the Investment Company Act of 1940 and the rules
promulgated thereunder.
ITEM 31. MANAGEMENT SERVICES
Not Applicable.
ITEM 32. UNDERTAKINGS
a. Registrant hereby undertakes to file a post-effective amendment to
this registration statement as frequently as is necessary to ensure that the
audited financial statements in the registration statement are never more than
sixteen (16) months old for so long as payment under the variable annuity
contracts may be accepted.
b. Registrant hereby undertakes to include either (1) as part of any
application to purchase a contract offered by the Prospectus, a space that an
applicant can check to request a Statement of Additional Information, or (2) a
postcard or similar written communication affixed to or included in the
Prospectus that the applicant can remove to send for a Statement of Additional
Information.
c. Registrant hereby undertakes to deliver any Statement of Additional
Information and any financial statement required to be made available under
this Form promptly upon written or oral request.
REPRESENTATIONS
The Company hereby represents that it is relying upon a No-Action Letter
issued to the American Council of Life Insurance dated November 28, 1988
(Commission ref. IP-6-88) and that the following provisions have been complied
with:
1. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in each registration statement, including the
prospectus, used in connection with the offer of the contract;
2. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in any sales literature used in connection with
the offer of the contract;
3. Instruct sales representatives who solicit participants to purchase
the contract specifically to bring the redemption restrictions imposed by
Section 403(b)(11) to the attention of the potential participants;
4. Obtain from each plan participant who purchases a Section 403(b)
annuity contract, prior to or at the time of such purchase, a signed statement
acknowledging the participant's understanding of (1) the restrictions on
redemption imposed by Section 403(b)(11), and (2) other investment
alternatives available under the employer's Section 403(b) arrangement to
which the participant may elect to transfer his contract value.
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant certifies that it meets the requirements of Securities
Act Rule 485(b) for effectiveness of this Registration Statement and has
caused this Registration Statement to be signed on its behalf, in the City of
Des Moines, and State of Iowa on this 8th day of February, 1996.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
SEPARATE ACCOUNT A
Registrant
By: EQUITABLE LIFE INSURANCE COMPANY OF IOWA
By: /S/ FRED S. HUBBELL
___________________________________________
Fred S. Hubbell, Chairman of the Board and
Chief Executive Officer
By: EQUITABLE LIFE INSURANCE COMPANY OF IOWA
Depositor
By: /S/ FRED S. HUBBELL
___________________________________________
Fred S. Hubbell, Chairman of the Board and
Chief Executive Officer
As required by the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
President, Chairman of the Board
/S/ FRED S. HUBBELL and Chief Executive Officer 2/8/96
- ------------------------- --------
Fred S. Hubbell and Director Date
Executive Vice President,
Paul E. Larson* Chief Financial Officer, 2/8/96
- ------------------------- --------
Paul E. Larson Assistant Secretary and Director Date
Senior Vice President -
Thomas L. May* Administration and Director 2/8/96
- ------------------------- --------
Thomas L. May Date
Paul R. Schlaack* Director 2/8/96
- ------------------------- --------
Paul R. Schlaack Date
General Counsel, Secretary
John A. Merriman* and Director 2/8/96
- ------------------------- --------
John A. Merriman Date
Senior Vice President,
Lawrence V. Durland, Jr.* Assistant Secretary and 2/8/96
- ------------------------- --------
Lawrence V. Durland, Jr. Director Date
Vice President and Chief
Susan M. Jordan* Information Officer and 2/8/96
- ------------------------- --------
Susan M. Jordan* Director Date
Vice President - Human
Beth B. Neppl* Resources and Director 2/8/96
- ------------------------- --------
Beth B. Neppl Date
</TABLE>
*By: /S/ FRED S. HUBBELL
______________________________________
Fred S. Hubbell, Attorney-in-Fact
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, Thomas L. May, a Director of
Equitable Life Insurance Company of Iowa, a corporation duly organized under
the laws of the State of Iowa, do hereby appoint, Fred S. Hubbell, Paul E.
Larson and David A. Terwilliger, or any one of the foregoing individually, as
my attorney and agent, for me, and in my name as a Director of this Company on
behalf of the Company or otherwise, with full power to execute, deliver and
file with the Securities and Exchange Commission all documents required for
registration of variable annuity and variable life insurance contracts under
the Securities Act of 1933, as amended, and the registration of unit
investment trusts under the Investment Company Act of 1940, as amended, and to
do and perform each and every act that said attorney may deem necessary or
advisable to comply with the intent of the aforesaid Acts.
WITNESS my hand this 18th day of January, 1996.
WITNESS:
/S/ G. THOMAS SULLIVAN /S/ THOMAS L. MAY
________________________________ ________________________________
G. Thomas Sullivan Thomas L. May
EXHIBITS
TO
POST-EFFECTIVE AMENDMENT NO. 3
TO
FORM N-4
FOR
EQUITABLE LIFE INSURANCE COMPANY OF IOWA SEPARATE ACCOUNT A
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
INDEX TO EXHIBITS
EXHIBIT PAGE
99.B6(i) Copy of Restated Articles of Incorporation
of the Company
99.B6(ii) Copy of Restated Bylaws of the Company
99.B8 Form of Fund Participation Agreement
99.B9 Opinion and Consent of Counsel
99.B10 Consent of Independent Auditors
27 Financial Data Schedule
EX-99.B6(i)
RESTATED ARTICLES OF INCORPORATION
OF
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
TO THE SECRETARY OF STATE
STATE OF IOWA:
AND
COMMISSIONER OF INSURANCE
OF THE STATE OF IOWA
Pursuant to the provisions of Sections 490.1003, 490.1007 and 508.2 the Code
of Iowa, the undersigned corporation adopts the following Restated Articles
of Incorporation:
I. The name of the corporation is Equitable Life Insurance Company of Iowa
II. The following are the Restated Articles of Incorporation of Equitable
Life Insurance Company of Iowa.
ARTICLE I
NAME OF CORPORATION
____________________
The name of the Corporation is Equitable Life Insurance Company of Iowa.
ARTICLE II
PRINCIPAL PLACE OF BUSINESS
____________________________
The principal place of business of the Corporation is located in the City of
Des Moines, Polk County, Iowa.
ARTICLE III
PURPOSE AND POWERS
__________________
SECTION 1. The purpose of the Corporation is to engage in a general
life, health and accident insurance and annuity business relating to the life
and health of persons and to provide all services which insurance companies
are now or hereafter may be permitted to provide by the Constitution and the
laws of the State of Iowa.
SECTION 2. The Corporation shall have all the rights, powers and
privileges which are necessary or convenient to effect its purpose and which
are not specifically forbidden by the Constitution and laws of the State of
Iowa governing the conduct of insurance companies. In furtherance, but not in
limitation of such general powers and the purpose hereinbefore stated, the
Corporation is empowered to issue policies on an individual or a group basis
on either the participating or nonparticipating plans providing for fixed or
variable benefits on such terms as the Board of Directors may direct; to
accept and to cede reinsurance of such risks; and to receive and execute
trusts, including the power to hold in trust the proceeds of any policies
issued by it or to enter into contracts for the disposition of the said
proceeds.
ARTICLE IV
CAPITAL STOCK
______________
The authorized Capital Stock of the Corporation shall be Seven Million Five
Hundred Thousand Dollars consisting of seven million five hundred thousand
shares of Common Stock of the par value of One dollar each, to be issued in
accordance with the laws of Iowa at such times and in such amounts as the
Board of Directors shall determine.
ARTICLE V
TERM OF EXISTENCE
__________________
The Corporation shall have perpetual existence.
ARTICLE VI
DIRECTORS
__________
SECTION 1. The affairs of the Corporation shall be managed by a Board of
Directors consisting of not less than five (5) nor more than twenty-one (21)
persons elected by the stockholders at the annual meeting. The number to be
elected may be determined by a resolution of the stockholders, but in the
absence of such resolution there shall be elected the number of directors that
were elected at the previous annual meeting.
SECTION 2. The term of office of each director shall be until the next
annual meeting of stockholders and until his successor, if any, is elected and
qualified, but it shall not extend beyond the annual meeting of stockholders
next following the date he attains age 70, except that for officer-directors
the term as a director shall terminate on the date he retires as an active
officer of the Corporation.
SECTION 3. The holder or holders, jointly or severally, of not less than
one-fifth of the shares of the capital stock shall be entitled to nominate
persons for election to the Board of Directors. There shall be elected, to
the extent that the total number to be elected is divisible, such
proportionate number from the persons so nominated as the shares of stock held
by persons making such nominations bear to the whole number of shares issued;
provided that the holder or holders of a minority of the shares of stock shall
be entitled to elect only one-fifth, disregarding fractions, of the total
number of directors to be elected for each full one-fifth of the entire
capital stock of the Corporation so held by them; and provided further, that
this section shall not be construed to prevent the holders of a majority of
the shares of stock of the Corporation from electing the majority of its
directors, or from electing all of the directors in the event that there are
no other nominees in accordance with the requirements of this section.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
____________________________________________________________
SECTION 1. In the manner and to the fullest extent permitted by the Iowa
Business Corporation Act as the same now exists or may hereafter be amended,
the Corporation shall indemnify directors, officers, employees and agents and
shall pay or reimburse them for reasonable expenses in any proceeding to which
said person is or was a party.
SECTION 2. A director of this Corporation shall not be personally liable
to the Corporation or its shareholders for monetary damages for breach of
fiduciary duty as a Director, except for liability (i) for any breach of any
duty of the Director of loyalty to the Corporation or its shareholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) for any transaction from which
the Director derived an improper personal benefit, or (iv) under Section
490.833 of the Iowa Business Corporation Act for assenting to or voting for an
unlawful distribution. If Chapter 490 of the Code of Iowa, is subsequently
amended to authorize corporate action further eliminating or limiting personal
liability of directors, then the liability of a director to the Corporation
shall be eliminated or limited to the fullest extent permitted by Chapter 490
of the Code of Iowa, as so amended. Any repeal or modification of the
provisions of this Article shall not adversely affect any right or protection
of a director of the Corporation existing at the time of such repeal or
modification.
SECTION 3. Any repeal or modification of the provisions of this Article
VII shall not adversely affect any right or protection of a director, officer,
employee or agent of the Corporation existing at the time of such repeal or
modification.
ARTICLE VIII
EXEMPTION FROM DEBTS
____________________
The private property of the stockholders shall not in any event be subject to
the debts of the Corporation.
ARTICLE IX
CONFLICT OF INTEREST TRANSACTIONS
__________________________________
Transactions by certain directors, officers or shareholders are governed by
the following provisions:
1. Except as otherwise provided by law, no contract or other transaction
between this Corporation and any person, firm, association or other
corporation shall be affected or invalidated by the fact that any director,
officer or shareholder of this Corporation is a party to or otherwise
interested in such contract or transaction or in any way connected with any
such person.
2. Except as otherwise provided by law, every director, officer or
shareholder of this Corporation is hereby relieved from any liability that
might otherwise exist by reason of contracting with this Corporation for the
benefit of himself or any other person, firm, association or corporation in
which he may be in any way interested.
3. Any such director of this Corporation may be counted in determining
the existence of a quorum at any meeting of the Board of Directors which will
authorize or confirm any contract or transaction between this Corporation and
any person, firm, association or other corporation and may vote thereat with
like force and effect as if he were not so interested or connected with such
person, firm, association or other corporation.
ARTICLE X
BYLAWS
______
Bylaws may be adopted for the Corporation by the Board of Directors and/or by
the Shareholders in lawful and proper meeting assembled. Any and all Bylaws
adopted by the Shareholders shall be superior to and shall prevail over Bylaws
adopted by the Board of Directors.
ARTICLE XI
SEAL
____
The Corporation shall have a seal.
III. The duly adopted Restated Articles of Incorporation supersede the
original Articles of Incorporation and all amendments to them.
IV. These Restated Articles of Incorporation amend the previously filed
Amended and Substituted Articles of Incorporation requiring shareholder
approval. The Restated Articles of Incorporation were approved by the
shareholders. The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately on the
Restated Articles of Incorporation, and the number of votes of each voting
group indisputably represented at the meeting is as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
VOTES ENTITLED
DESIGNATION SHARES TO BE CAST ON VOTES REPRESENTED
OF GROUP OUTSTANDING RESTATED ARTICLES AT MEETING
- ----------- ------------- -------------------- -----------------
Common 5,000,300 5,000,300 5,000,300
</TABLE>
The total number of undisputed votes case for these Restated Articles of
Incorporation by each voting group was:
<TABLE>
<CAPTION>
<S> <C>
VOTING VOTES
GROUP FOR
- ------------------------ --------------
Common 5,000,300
</TABLE>
The number of votes cast for the restated articles of incorporation by
each voting group was sufficient for approval by that voting group.
Dated at Des Moines, Iowa, this 25 day of January, 1995.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
/S/ FREDERICK S. HUBBELL
________________________________________
FREDERICK S. HUBBELL, PRESIDENT
(SEAL) /S/ JOHN A. MERRIMAN
________________________________________
JOHN A. MERRIMAN, SECRETARY
STATE OF IOWA )
) ss:
COUNTY OF POLK )
On this 25 day of January, 1995, before me, the undersigned, a
Notary Public in and for the state of Iowa, personally appeared Frederick S.
Hubbell and John A. Merriman, to me personally known, who, being by me duly
sworn, did say that they are the President and Secretary respectively, of said
corporation executing the within and foregoing instrument to which this is
attached, that the seal affixed thereto is the seal of said corporation; that
said instrument was signed and sealed on behalf of said corporation by
authority of its Board of Directors; and that the said Frederick S. Hubbell
and John A. Merriman as such officers acknowledged the execution of said
instrument to be the voluntary act and deed of said corporation, by it and by
them voluntarily executed.
/S/Janet K. Altes
___________________________________
Notary Public in and for said
County and State
The foregoing Restated Articles of Incorporation of Equitable Life Insurance
Company of Iowa have been submitted to the undersigned each thereof for
examination and found by us to be in accordance with the provisions of Chapter
508 and Chapter 490 of the Code of Iowa, as amended, and the Constitution
and laws of the United States and the Constitution and the laws of the State
of Iowa, and the same are hereby approved by the undersigned Commissioner of
Insurance of the State of Iowa, and the undersigned Attorney General of the
State of Iowa, on the dates set opposite our respective names.
Commissioner of Insurance
of the State of Iowa
DATED: 2-9 , 1995 By:/S/ Robert L. Howe
____________________ _______________________________
Attorney General
of the State of Iowa
DATED: 2-6 , 1995 By:/S/ Scott M. Galenbeck
____________________ _______________________________
EX-99.B6(ii)
RESTATED
BYLAWS OF
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
ARTICLE I
OFFICES
________
The principal office of the Corporation shall be located at 604 Locust
Street, Des Moines, Iowa 50309. The Corporation may have such other offices
either within or without the State of Iowa as the business of the Corporation
may from time to time require.
The registered office of the Corporation required by the Iowa Business
Corporation Act to be maintained in the State of Iowa may be, but need not be,
identical with the principal office in the State of Iowa.
ARTICLE II
SHAREHOLDERS
____________
SECTION 1. ANNUAL MEETING. The annual meeting of the Shareholders shall
be held on a date no later than April 30 of each year as designated by the
Board of Directors, for the purpose of electing Directors and for the
transaction of such other business as may come before the meeting. If the day
fixed for the annual meeting shall, for any reason, be a legal holiday, such
meeting shall be held on the next succeeding business day. If the election of
Directors shall not be held on the day designated herein for any annual
meeting, or for any adjournment thereof, the Board of Directors shall cause
the election to be held at a special meeting of the Shareholders as soon
thereafter as may be convenient.
SECTION 2. SPECIAL MEETINGS. Special meetings of the Shareholders may
be called by the President, the Secretary, the Board of Directors acting upon
majority vote, or the holders of not less than one-tenth of all the
outstanding shares of the Corporation entitled to vote at such meeting. No
business other than that specified in the notice of meeting shall be
transacted at a special meeting of the Shareholders.
SECTION 3. RULES. All meetings of the Shareholders shall be conducted
in accordance with Robert's Rules of Order.
SECTION 4. PLACE OF MEETING. The Board of Directors may designate any
place either within or without the State of Iowa as the place of meeting for
any annual meeting or for any special meeting called by the Board of
Directors. If no designation is made, the place of meeting shall be the
principal office of the Corporation in the State of Iowa, except as otherwise
provided in Section 6 of this Article.
SECTION 5. NOTICE OF MEETINGS. Written or printed notice, stating the
place, day and hour of the meeting, and in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not
less than ten (10) nor more than sixty (60) days before the date of the
meeting, either personally or by mail, by or at the direction of the
President, the Secretary, or the officer or persons calling the meeting, to
each Shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States
Mail in a sealed envelope addressed to the Shareholder at his address as it
appears on the stock transfer books of the Corporation, with postage thereon
prepaid.
SECTION 6. MEETING OF ALL SHAREHOLDERS. If all of the Shareholders
shall meet at any time and place, either within or without the State of Iowa,
and consent in writing to the holding of a meeting, such meeting shall be
valid without call or notice, and at such meeting any corporate action may be
taken.
SECTION 7. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE. For the
purpose of determining Shareholders entitled to notice, or to vote at any
meeting of Shareholders, or any adjournment thereof, or entitled to receive
payment of any dividend, or in order to make a determination of Shareholders
for any other proper purpose, the Board of Directors may close the stock
transfer books for a stated period but not to exceed, in any case, sixty (60)
days. If the stock transfer books shall be closed for the purpose of
determining Shareholders entitled to notice of or to vote at a meeting of
Shareholders, such books shall be closed for at least ten (10) days
immediately preceding such meeting. In lieu of closing the stock transfer
books, the Board of Directors may fix in advance a date as the record date for
any such determination of Shareholders. Such date in any case shall be not
more than seventy (70) days and, in case of a meeting of Shareholders, not
less than ten (10) days prior to the date on which the particular action,
requiring such determination of Shareholders, is to be taken. If the stock
transfer books are not closed and no record date is fixed for the
determination of Shareholders entitled to notice of or to vote at a meeting of
Shareholders, or Shareholders entitled to receive payment of the dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the Board of Directors declaring such dividend is adopted, as
the case may be, shall be the record date for such determination of
Shareholders. When a determination of Shareholders entitled to vote at any
meeting of Shareholders has been made as provided in this Bylaw, such
determination shall apply to any adjournment thereof, unless the board of
directors fixes a new record date, which it must do if the meeting is
adjourned to a date more than one hundred twenty (120) days after the date
fixed for the original meeting.
SECTION 8. VOTING RECORDS. The officer or agent having charge of the
stock transfer books for shares of the Corporation shall prepare, within two
(2) business days after notice of a Shareholders' meeting is given, an
alphabetical list of the names of all Shareholders who are entitled to notice
of that meeting. The list must be arranged by voting group and within each
voting group by class or series of shares, and show the address of and number
of shares held by each Shareholder. This record shall be available for
inspection by any Shareholder beginning two (2) days after notice of the
meeting is given for which the list was prepared and continuing through the
meeting, at the Corporation's principal office or at a place identified in the
meeting notice in the city where the meeting will be held. Such record shall
also be produced and kept open at the time and place of the meeting and shall
be subject to the inspection of any Shareholder, or a Shareholder's agent or
attorney, at any time during the meeting or any adjournment. A Shareholder,
or a Shareholder's agent or attorney, is also entitled to copy the record
during regular business hours and at the person's expense during the period it
is available for inspection if (1) the person's demand is made in good faith
and for a proper purpose, (2) the person describes with reasonable
particularity his purpose, and (3) the record is directly connected with the
person's purpose. The stock transfer book shall be prima facie evidence as to
who are the Shareholders entitled to examine such record or transfer books, or
to vote at any meeting of Shareholders.
SECTION 9. QUORUM. A majority of the shares entitled to vote
represented in person or by proxy, shall constitute a quorum at any meeting of
Shareholders. Once a share is represented for any purpose at a meeting, it is
deemed present for quorum purposes for the remainder of the meeting and for
any adjournment of that meeting, unless a new record date is or must be set
for that adjourned meeting. If a quorum exists, action on a matter, other
than the election of directors, is approved if the majority of the votes
actually cast favors the action, unless the vote of a greater number is
required by the Iowa Business Corporation Act or by these Bylaws or by the
Articles of Incorporation.
If at any annual or special meeting of the Shareholders or any
adjournment of such meeting a quorum shall fail to attend in person or by
proxy, a majority in interest of the Shareholders attending, in person or by
proxy at the time and place of said meeting or adjourned meeting may adjourn
the same from time to time without notice other than by announcement at the
meeting until a quorum shall attend, and thereupon any business may be
transacted which might have been transacted at the meeting as originally
called had the same been then held.
SECTION 10. PROXIES. At all meetings of Shareholders, a Shareholder may
vote either in person or by a proxy pursuant to an appointment form executed
in writing by the Shareholder or by his duly authorized Attorney-in-Fact.
Such an appointment shall be filed with the Secretary of the Corporation
before or at the time of the meeting. No appointment shall be valid after
eleven (11) months from the date of its execution unless otherwise provided in
the appointment form. An appointment of a proxy is revocable by the
Shareholder unless the appointment form conspicuously states that it is
irrevocable and the appointment is coupled with an interest. An irrevocable
appointment is revoked when the interest with which it is coupled is
extinguished.
SECTION 11. VOTING OF SHARES. Each outstanding share shall be entitled
to one (1) vote upon each matter submitted to a vote at a meeting of the
Shareholders, unless otherwise provided in the Articles of Incorporation or
the Iowa Business Corporation Act, or in the instance of authorized and issued
Preferred Stock, subject to such voting rights as provided in a resolution of
the Board of Directors designating a series thereof. The cumulative method of
voting shall not be allowed.
SECTION 12. VOTING OF SHARES BY CERTAIN HOLDERS. Shares standing in the
name of another corporation, domestic or foreign, may be voted by such
officer, agent or proxy as the Bylaws of such Corporation may prescribe, or,
in the absence of such provision, as the Board of Directors of such
Corporation shall determine.
Shares held by an Administrator, Executor, Guardian or Conservator may be
voted by him either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name.
Shares standing in the name of a receiver may be voted by such receiver,
and shares held by or under the control of a receiver may be voted by such
receiver without the transfer thereof into his name if authority to do so be
contained in an appropriate order of the court by which such receiver was
appointed.
A Shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee,
and thereafter the pledgee shall be entitled to vote the shares so
transferred.
SECTION 13. ORGANIZATION. The President shall call the meetings of
Shareholders to order and act as presiding officer thereof. In the absence of
the President, a majority of the shares present represented in person or by
proxy may elect any Shareholder present, or the duly authorized proxy of any
Shareholder, to act as presiding officer of the meeting. The Secretary of the
Corporation shall act as Secretary of all meetings of the Shareholders, but in
his absence the presiding officer may appoint any person to act as Secretary
of the meeting.
SECTION 14. ORDER OF BUSINESS. The order of business at all meetings of
Shareholders, unless otherwise determined by a vote of a majority of the
shares represented in person or by proxy at such meeting, shall be determined
by the presiding officer.
SECTION 15. BALLOTING. Upon the demand of any Shareholder, the vote
upon any question before the meeting shall be by ballot. If such demand is
made, the presiding officer shall appoint Inspectors of Election, not to
exceed three (3) in number, to receive and take charge of proxies and ballots.
No director or candidate for the office of director shall be appointed as
such inspector.
SECTION 16. ACTION BY SHAREHOLDERS WITHOUT MEETING. Any action required
or permitted by the Iowa Business Corporation Act to be taken at a
Shareholders' meeting may be taken without a meeting or vote, without prior
notice, if one or more written consents describing the action taken are signed
by the holders of outstanding shares having not less than ninety percent (90%)
of the votes entitled to be cast at a meeting at which all shares entitled to
vote on the action were present and voted, and are delivered to the
Corporation for inclusion in the minutes or filing with the corporate records.
ARTICLE III
DIRECTORS
__________
SECTION 1. GENERAL POWERS. The business and affairs of the Corporation
shall be managed by its Board of Directors. The Board of Directors shall have
the power to commit shares of the authorized but unissued capital stock of the
Corporation for acquisitions of other property of any and all kinds. Such
stock shall be issued at valuation placed thereon by the Board of Directors,
but in no event for a consideration less than the par value of such shares.
SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The number of Directors
of the Corporation shall be not less than five (5) nor more than twenty-one
(21) persons elected by the shareholders at the annual meeting of the
Corporation. The number to be elected may be determined by a resolution of
the shareholders, but in the absence of such a resolution there shall be
elected the number of directors that were elected at the previous annual
meeting. Subject to the Restated Articles of Incorporation, each Director
shall hold office for the term of which they are elected, and until their
successors shall have been elected and qualified.
SECTION 3. REGULAR MEETINGS. A regular meeting of the Board of Directors
shall be held without other notice than this Bylaw, immediately after, and at
the same place as, the annual meeting of Shareholders. The Board of Directors
may provide by resolution, the time and place, either within or without the
State of Iowa, for the holding of additional regular meetings without other
notice than such resolution.
SECTION 4. SPECIAL MEETING. Special meetings of the Board of Directors
may be called by or at the request of the President or the Executive
Committee, and shall be called on written request of three (3) members of the
Board of Directors. Meetings of the Board shall be held at the principal
office of the Corporation unless a different place, either within or without
the State of Iowa shall be designated by the President or Board of Directors.
SECTION 5. NOTICE. Notice of any special meeting shall be given at
least one (1) day previously thereto by oral, telephonic, telegraphic or
written notice, delivered or mailed, to each Director at his address on file
with the Corporation. If mailed or telegraphed, such notice shall be deemed
to be delivered when deposited in the United States Mail or delivered to the
telegraph company, as the case may be. Any Director may waive notice of any
meeting. The attendance of a Director at any meeting shall constitute a
waiver of notice of such meeting, except where a Director attends a meeting
for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business
to be transacted at, nor the purpose of, any regular or special meeting of the
Board of Directors need be specified in the notice or waiver of notice of such
meeting.
SECTION 6. QUORUM. A majority of the Board of Directors shall
constitute a quorum for the transaction of business at any meeting of the
Board of Directors, provided that if less than a majority of the Directors are
present at such meeting, a majority of the Directors present may adjourn the
meeting from time to time without further notice. The act of a majority of
the Directors present at a meeting at which a quorum is present shall be the
act of the Board of Directors.
Members of the Board of Directors of the Corporation may participate in a
meeting of the Board of Directors by conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting pursuant to this
provision shall constitute presence in person at such meeting.
SECTION 7. VACANCIES. Subject to the provisions of Section 3 of Article
VI of the Corporations Restated Articles of Incorporation, any vacancy
occurring in the Board of Directors and any Directorship to be filled by
reason of an increase in the number of Directors may be filled by the
affirmative vote of a majority of the Directors then in office, even if less
than a quorum of the Board of Directors. A Director so elected shall be
elected for the unexpired term of his predecessor in office or the full term
of such new Directorship.
SECTION 8. RESIGNATION. Any Director may resign at any time. Such
resignation shall be made in writing and shall take effect at the time
specified therein. If no time is specified, it shall take effect at the time
of its receipt by the Secretary, who shall record such resignation noting the
time of its reception. The acceptance of a resignation shall not be necessary
to make it effective.
SECTION 9. REMOVAL. The entire Board of Directors or any individual
Director may be removed from office, with or without cause, at a Shareholders'
meeting called expressly for that purpose by the vote of a majority of those
who actually vote. In case the entire Board or any one or more of the
Directors are so removed, new Directors may be elected at the same meeting for
the unexpired term of the Director or Directors so removed. A director shall
not be removed without a meeting pursuant to written consents unless such
consents are obtained from the holders of all the outstanding shares of the
Corporation. Failure to elect Directors to fill the unexpired term of the
Directors so removed shall be deemed to create a vacancy or vacancies in the
Board of Directors.
SECTION 10. PRESIDING OFFICER. The Board of Directors, at the first
meeting and at each regular meeting held immediately following the annual
meeting of Shareholders, may appoint one of their number to act as Chairman of
the Board of Directors, who may also be an officer of the Corporation, and,
unless otherwise provided by the Board of Directors, as Chairman he shall
preside at meetings of the Board. In his absence a member of the Board to be
selected by the members present shall preside. The Secretary of the
Corporation shall act as Secretary at all meetings of the Board, or in his
absence the Board of Directors meeting may designate any person to act as
Secretary. The Chairman of the Board of Directors shall perform such other
duties as from time to time may be assigned to him by the Board of Directors.
SECTION 11. ORDER OF BUSINESS. The order of business at all meetings of
the Board of Directors, unless otherwise determined by the affirmative vote of
a majority of the members of such Board present at any meeting, shall be
determined by the presiding officer.
SECTION 12. EFFECT OF PRESENCE AT MEETINGS. A Director of the
Corporation who is present at a meeting of the Board of Directors at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the Secretary of the meeting before the adjournment thereof
or shall forward such dissent by registered or certified mail to the Secretary
of the Corporation immediately after the adjournment of the meeting. Such
right to dissent shall not apply to a Director who voted in favor of such
action.
SECTION 13. COMPENSATION. Compensation of the Directors and members of
the Executive Committee, other than officer-directors, shall be fixed by
resolution of the Board of Directors. No stated salary shall be paid
Directors and members of the Executive Committee, as such for their services,
but by resolution of the Board of Directors, a fixed sum and expenses may be
allowed for attendance at each regular or special meeting of such Board or
Committee; provided that nothing herein contained shall be construed to
preclude any Director or member of the Executive Committee from serving the
Corporation in any other capacity and receiving compensation therefor.
SECTION 14. CONFLICT OF INTEREST. No contract or other transaction
between the Corporation and one or more of its Directors or any other
Corporation, firm, association or entity in which one or more of its Directors
are Directors or Officers or are financially interested, shall be either void
or voidable because of such relationship or interest or because such Director
or Directors are present at the meeting of the Board of Directors or a
committee thereof which authorizes, approves or ratifies such contract or
transaction or because his or their votes are counted for such purpose, if any
of the following occur:
(a) The fact of such relationship or interest is disclosed or known to
the Board of Directors or committee which authorizes, approves, or ratifies
the contract or transaction by a vote or consent sufficient for the purpose
without counting the votes or consents of such interested Director.
(b) The fact of such relationship or interest is disclosed or known to
the Shareholders entitled to vote and they authorize, approve or ratify such
contract or transaction by vote or written consent.
(c) The contract or transaction is fair and reasonable to the
Corporation.
Common or interested Directors may be counted in determining the presence
of a quorum at a meeting of the Board of Directors or a committee thereof
which authorizes, approves, or ratifies such contract or transaction.
SECTION 15. ACTION BY BOARD OF DIRECTORS WITHOUT MEETING. Any action
required to be taken at a meeting of the Board of Directors by the Iowa
Business Corporation Act, may be taken without a meeting of the Board of
Directors if written consent setting forth the action so taken shall be signed
by all of the members of the Board of Directors and included in the minutes or
filed with the corporate records reflecting the action taken. Such written
consent shall have the same force and effect as a unanimous vote of the Board
of Directors and may be stated as such in any article or document filed with
the Secretary of State of the State of Iowa pursuant to the provisions of the
Iowa Business Corporation Act. The provisions of this Bylaw shall be
applicable whether or not the Iowa Business Corporation Act requires that such
action be taken by resolution of the Board of Directors.
ARTICLE IV
THE EXECUTIVE COMMITTEE AND OTHER COMMITTEES
____________________________________________
SECTION 1. APPOINTMENT. The board shall appoint the following standing
committees, naming the Chairman and members of each who shall serve during the
pleasure of the Board: an Executive Committee, a Compensation Committee and
an Audit Committee. The Chief Executive Officer may appoint such other
committees among the directors, officers, agents or employees of the
Corporation as he deems necessary and appropriate for the proper conduct of
the Corporation's business. Each committee shall appoint a Secretary to serve
during its pleasure and to keep minutes of its meetings.
SECTION 2. EXECUTIVE COMMITTEE. Three or more directors of the
Corporation shall be appointed to act as an Executive Committee.
SECTION 3. POWERS OF THE EXECUTIVE COMMITTEE. Except as may at any time
be otherwise provided by law, the Executive Committee, in intervals between
the meetings of the full Board of Directors, shall possess and exercise all of
the powers of the Board of Directors in the management, direction and control
of the operations, business and affairs of the Corporation, in such manner as
the Executive Committee shall deem for the best interest of the Corporation,
in all cases where specific directions shall not have been given by the Board
of Directors, and shall have power to authorize the seal of the Corporation to
be affixed to all instruments and documents which may require it, but no such
Committee shall have the authority of the Board of Directors in reference to
amending the Articles of Incorporation, authorizing distributions, filling
vacancies on the Board of Directors or on any of its committees, authorizing
the issuance or reacquisition of shares unless according to a method
prescribed by the Board of Directors, adopting a plan of merger or
consolidation, recommending to the shareholders the sale, lease, exchange or
other disposition of all or substantially all of the property and assets of
the Corporation otherwise than in the usual and regular course of its
business, recommending to the shareholders a voluntary dissolution of the
Corporation or a revocation thereof, or amending the Bylaws of the
Corporation. The designation of any such Committee and the delegation thereto
of authority shall not operate to relieve the Board of Directors, or any
member thereof, of any responsibility imposed by law.
SECTION 4. EXECUTIVE COMMITTEE TO REPORT TO BOARD. All action by the
Executive Committee shall be reported to the Board of Directors at its meeting
next succeeding the date when such action is taken, and shall be subject to
revision, amendment or alteration, but failure to submit the same or to
receive approval thereof shall not invalidate any completed or incompleted
action taken by the Corporation upon authorization by the Executive Committee
prior to the time at which the same has been, or was, submitted to the Board
of Directors.
SECTION 5. PROCEDURE. The Executive Committee shall fix its own rules
of procedure (which need not be written) and shall meet when, where and as
provided by such rules or by resolution of the Board of Directors. Unless
designated by the Board of Directors, the Chairman of the Executive Committee
shall be chosen by the Executive Committee, and the Secretary of the
Corporation, if present, shall act as Secretary of the meetings. In the
absence of either, the Executive Committee shall appoint a Chairman or
Secretary, as the case may be, of the meeting. The Executive Committee shall
keep a record of its acts and proceedings. A majority of the Executive
Committee shall be necessary to constitute a quorum for the transaction of any
business, and the act of a majority of the members present at a meeting at
which a quorum is present shall be the act of the Executive Committee. The
members of the Executive Committee shall act only as a committee, and the
individual members shall have no power as such, but the Executive Committee
may act by the written resolution of a majority thereof although not formally
convened. The Board of Directors may vote the members of the Executive
Committee a reasonable fee as compensation for attendance at meetings of such
committee.
SECTION 6. ACTION BY COMMITTEES WITHOUT MEETING. Any action required or
permitted to be taken at a meeting of a Committee of the Board of Directors by
the Iowa Business Corporation Act, may be taken without a meeting of a
Committee if written consent setting forth the action so taken shall be signed
by all of the members of a Committee and included in the minutes or filed with
the corporate records reflecting the action taken. Such written consent shall
have the same force and effect as a unanimous vote by the members of the
Committee and may be stated as such in any articles or documents filed with
the Secretary of State of the State of Iowa pursuant to the Iowa Business
Corporation Act. The provisions of this Bylaw shall be applicable whether or
not the Iowa Business Corporation Act requires that such action be taken by
resolution by the members of a Committee.
SECTION 7. COMPENSATION COMMITTEE. Three or more directors of the
Corporation shall be appointed to act as a Compensation Committee which may
recommend to the Board the compensation of the executive officers and shall be
responsible for reviewing the various compensation and benefit plans adopted
by the Corporation for the benefit of its employees, and making appropriate
recommendations to the Board. It shall also recommend fees to be paid to
members of the Board for services to the Corporation.
SECTION 8. AUDIT COMMITTEE. Three or more directors of the Corporation
shall be appointed to act as an Audit Committee which shall review the
financial statements of the Corporation consult with the internal auditors and
certified public accountants, and from time to time report to the Board.
SECTION 9. OTHER COMMITTEES. The Board of Directors may by resolution
provide for such other standing or special committees as it from time to time
deems desirable, and discontinue the same at its pleasure. Each such
committee shall have such powers and perform such duties, not inconsistent
with law, as may be assigned to it by the Board of Directors. If provision be
made for any such committee, the members thereof shall be appointed by the
Board of Directors and shall serve at the pleasure of the Board. Vacancies in
such committees shall be filled by the Board of Directors.
ARTICLE V
OFFICERS
________
SECTION 1. EXECUTIVE OFFICERS. The executive officers of the
Corporation shall consist of a Chairman of the Board and a President, both of
whom shall be elected from the Board of Directors (hereafter called the
Board), and such other officers as may be designated executive officers by the
Board from time to time. The Chief Executive Officer (selected in accordance
with Section 3 hereof) shall nominate officers so designated as executive
officers for election by the Board. Executive officers shall perform the
duties usually pertaining to their respective offices or assigned to them by
the Board or the Chief Executive Officer. Any two or more executive offices
may be held by the same person.
SECTION 2. ADDITIONAL OFFICERS. Unless elected under the provisions of
Section 1 of this Article, a Secretary, a Treasurer, an Actuary, and a General
Counsel shall be elected by the Board on nomination by the Chief Executive
Officer, and shall perform the duties usually pertaining to their respective
offices or assigned to them by the Board or the Chief Executive Officer. The
Chief Executive Officer shall designate such other officers as he deems
necessary and appropriate for the conduct of the corporation's affairs. Any
such additional officers need not be employees of the Corporation but may
serve on a contractual or consulting basis. The Chief Executive Officer may
also grant to employees who are not officers of the corporation such titles as
he deems necessary and appropriate for the proper conduct of the Corporation's
business. He shall have the power to withdraw the titles granted pursuant to
this Section. Any two or more offices may be held by the same person.
SECTION 3. CHIEF EXECUTIVE OFFICER. The Board shall designate an
Executive Officer of the Corporation as Chief Executive Officer and shall
designate officers in order of succession from among the executive officers to
perform such duties during the temporary absence or inability of the Chief
Executive Officer to perform such duties. The Chief Executive Officer shall
be responsible to the Board for the general supervision of the affairs of the
Corporation and the direction of its officers, and shall perform the specific
duties provided in these Bylaws and any other duties assigned to him by the
Board.
SECTION 4. ELECTION AND TERM OF OFFICE. The officers of the Corporation
shall be elected annually by the Board of Directors at its annual meeting
immediately following the annual meeting of Shareholders. If the election of
officers shall not be held at such a meeting, such election of officers shall
be held as soon thereafter as conveniently may be. Vacancies may be filled,
or new offices created and filled at any meeting of the Board of Directors.
Each officer shall hold office until his successor shall have been duly
elected or until his death, or until he shall resign or shall have been
removed, in the manner hereafter provided.
SECTION 5. VACANCIES. Any vacancy in office, occurring during the year
through death, resignation or other cause, may be filled for the unexpired
portion of the term by a majority vote of the Board of Directors at any
special meeting or regular meeting thereof.
SECTION 6. COMPENSATION OF OFFICERS. The salaries of the officers shall
be fixed from time to time as authorized by the Board of Directors and no
officer shall be prevented from receiving such salary by reason of the fact
that he is also a Director of the Corporation.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
____________________________________________________________
SECTION 1. INDEMNIFICATION AUTHORIZATION. In the manner and to the
fullest extent permitted by the Iowa Business Corporation Act as the same now
exists or may hereafter be amended, the Corporation shall indemnify directors,
officers, employees and agents and shall pay or reimburse them for reasonable
expenses in any proceeding to which said person is or was a party.
SECTION 2. STANDARD OF CONDUCT. Any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceedings, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or enterprise, shall be indemnified to the following
extent and under the following circumstances:
(a) In an action, suit or proceeding other than an action by or in the
right of the Corporation, such person shall be indemnified against expenses
(including attorney's fees), judgments, fines, and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably believed
to be in the best interests of the Corporation, in the case of conduct in his
official capacity with the Corporation, or, in all other cases, at least not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, if he had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding
judgment, order, settlement, conviction or upon a plea of nolo contendere or
its equivalent shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his
conduct was unlawful.
(b) In an action, suit or proceedings by or in the right of the
Corporation, notwithstanding any provision precluding liability in the
Articles of Incorporation, such person shall nonetheless be indemnified
against expenses (including attorney's fees) actually and reasonably incurred
by him in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in the
best interests of the Corporation, in the case of conduct in his official
capacity with the Corporation, or, in all other cases, at least not opposed to
the best interests of the Corporation, except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the
performance of his duty to the Corporation unless and only to the extent that
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability, but in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such court shall deem proper.
SECTION 3. CONDITIONS FOR INDEMNIFICATION. Any indemnification under
this Bylaw (unless ordered by a court) shall be made by the Corporation only:
(a) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in the defense of
any action, suit or proceeding referred to in paragraph (a) and (b) of Section
2 above, or in the defense of any claim, issue or matter therein, he shall be
indemnified against expenses in connection therewith, or
(b) Upon a determination that the indemnification of such director,
officer, employee or agent is proper in the circumstances because he has met
the applicable standard of conduct set forth in paragraphs (a) and (b) of
Section 2 above. Such determination shall be made by (1) the Board of
Directors by a majority vote of a quorum consisting of directors who are not
parties to the action, suit or proceeding, or (2) if such quorum is not
obtainable, or, even if obtainable, a quorum of disinterested Directors so
directs, independent legal counsel in a written opinion, or (3) the
shareholders.
The Corporation shall not indemnify a director in connection with a
proceeding by or in the right of the Corporation in which the director was
adjudged liable to the Corporation or in connection with any proceeding
charging improper personal benefit to the director, whether or not involving
action in the director's official capacity, in which the director was adjudged
liable on the basis that personal benefit was improperly received by the
director.
SECTION 4. PAYMENT OF EXPENSES. Expenses, including attorney's fees,
incurred in defending a civil or criminal action, suit or proceeding may be
paid by the Corporation in advance of the final disposition of such action,
suit or proceeding as authorized in the manner provided in Section 3(b) above
upon receipt of an undertaking by or on behalf of the director, officer,
employee or agent to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the Corporation as
authorized in this Bylaw.
SECTION 5. INDEMNIFICATION UNDER BYLAWS NOT EXCLUSIVE. The
indemnification herein provided shall not be deemed exclusive of any other
rights, which those indemnified may be entitled under any Bylaw, agreement,
vote of the shareholders or disinterested directors, or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased to be a
director, officer, employee, or agent and shall inure to the benefit of the
heirs, executor, and administrator of such a person.
SECTION 6. INSURANCE. The Corporation shall have power to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee, or agent of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee, or agent of another
Corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise against any liability asserted against him and incurred by him in
any such capacity or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of this Bylaw.
SECTION 7. SURVIVAL OF AUTHORITY. Any repeal or modification of the
provisions of this Article VI shall not adversely affect any right or
protection of a director, officer, employee or agent of the Corporation
existing at the time of such repeal or modification.
ARTICLE VII
CERTIFICATES FOR SHARES AND THEIR TRANSFER
__________________________________________
SECTION 1. CERTIFICATES FOR SHARES. Every shareholder of the
Corporation shall have a certificate, in such form as may be determined by the
Board of Directors, signed by either the President or a Vice President and by
the Secretary or an Assistant Secretary, and impressed with the seal of the
Corporation or a facsimile thereof, if the Corporation elects to have one,
certifying the number of shares of the Corporation owned by him. All
certificates for shares shall be consecutively numbered, and the name of the
person owning the shares represented thereby with the number of shares and the
date of issue shall be entered on the books of the Corporation. The
signatures of the President or Vice President and the Secretary or an
Assistant Secretary may be facsimiles if the certificate is countersigned by a
transfer agent, or registered by a registrar, other than the Corporation
itself or an employee of the Corporation. The Board of Directors shall have
power and authority to make all such rules and regulations as they may deem
expedient concerning the issue, transfer and registration of certificates for
shares of the Corporation. In case any officer or other authorized person of
the Corporation who has signed, or whose facsimile signature has been used on,
any such certificate shall cease to be such officer, employee, or agent, for
whatever cause, before the certificate shall have been issued by the
Corporation, the certificate may, nevertheless, be issued by the Corporation
with the same effect as though the person who signed it or whose facsimile
signature has been used thereon was such officer or employee or agent at the
date of issue.
SECTION 2. TRANSFER OF SHARES. Transfer of shares of the Corporation
shall be made only on the books of the Corporation by the registered holder
thereof, or by his attorney thereunto authorized by Power of Attorney, duly
executed and filed with the Secretary of the Corporation, and on surrender for
cancellation of the certificates for such shares. The person in whose name
shares stand on the Corporation books shall be deemed the owner thereof for
all purposes as regards the Corporation.
SECTION 3. TRANSFER AGENT AND REGISTRAR. The Board of Directors may
appoint a transfer agent or a registrar and may require all stock certificates
to bear the signature of such transfer agent or registrar. When the
certificate is signed by a transfer agent or a registrar, the signature of the
President or Vice President and Secretary or Assistant Secretary may be
facsimiles.
SECTION 4. SURRENDERED, LOST OR MUTILATED CERTIFICATES. All
certificates surrendered to the Corporation for transfer shall be cancelled,
and no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except that in the
case of a lost, destroyed, or mutilated certificate, a new one may be issued
therefor upon such terms and conditions as the Board of Directors may deem
advisable and as may be permitted by the law of Iowa.
SECTION 5. SEAL. The Corporation shall have a seal. The corporate seal
of the corporation shall consist of two concentric circles between which shall
be the words "Equitable Life Insurance Company of Iowa" with the words
"Corporate Seal" inserted in the center thereof. The Secretary shall have
custody of the corporate seal, and he or an Assistant Secretary shall have
authority to affix the same to any instrument executed on behalf of the
Corporation and when so affixed, it may be attested by his signature.
ARTICLE VIII
CAPITAL STOCK, ISSUANCE AND DIVIDENDS
______________________________________
SECTION 1. CONSIDERATION. The consideration for the issuance of shares
of stock in the Corporation may consist, in whole or in part, of any tangible
or intangible property or benefit to the Corporation, including cash,
promissory notes, services performed, contracts for services to be performed,
or other securities of the Corporation. When payment of the consideration for
which shares are to be issued shall have been received by the Corporation,
such shares shall be deemed to be fully paid and non-assessable, but the
Corporation may place in escrow shares issued for a contract for future
services or a promissory note, or make other arrangements to restrict the
transfer of the shares, and may credit distributions in respect of the shares
against their purchase price, until the services are performed, the note is
paid, or the benefits received. If the services are not performed, the note
is not paid, or the benefits are not received, the shares escrowed or
restricted and the distributions credited may be cancelled in whole or in
part. In the absence of fraud in the transaction, the judgment of the Board
of Directors or the Shareholders, as the case may be, as to the value of the
consideration received for the shares shall be conclusive, but in no event
shall stock of the Corporation be issued for consideration less than the par
value of the stock to be so issued. No certificate representing shares of
stock in the Corporation shall be issued for any share until such share is
fully paid.
SECTION 2. PURCHASE BY CORPORATION. The Corporation shall have the
right to purchase, take, receive or otherwise acquire, hold, own, pledge,
transfer, or otherwise dispose of its own shares for such consideration that
the Board of Directors may determine. Unless otherwise directed by resolution
of the Board of Directors, such shares shall constitute treasury shares; and
purchases by the Corporation of its own shares, whether direct or indirect,
may be made only to the extent of the corporate surplus.
Notwithstanding the foregoing limitation, the Corporation may purchase or
otherwise acquire its own shares for the purpose of:
(a) Eliminating fractional shares.
(b) Collecting or compromising indebtedness to the Corporation.
(c) Paying dissenting shareholders entitled to payment for their shares
under the provisions of the laws of the State of Iowa.
(d) Effecting, subject to other provisions of Iowa law, the retirement
of its redeemable shares by redemption or by purchase at not to exceed the
redemption price.
No purchase of or payment by the Corporation for its own shares shall be
made at the time when the Corporation is insolvent or when such purchase or
payment would make it insolvent.
Whenever the Board of Directors resolves to treat any shares of the
Corporation which have been purchased by it as redeemed, and thus restored to
the category of authorized but unissued shares, a statement of cancellation
shall be filed with the Secretary of State of the State of Iowa as required by
law.
SECTION 3. DIVIDENDS. The Board of Directors may, from time to time,
declare, and the Corporation may pay dividends on its outstanding shares in
cash, property, or in its own shares, out of unreserved surplus, but no
distribution may be made if, after giving it effect, either of the following
would result:
(a) The Corporation would not be able to pay its debts as they become
due in the usual course of business.
(b) The Corporation's total assets would be less than the sum of its
total liabilities plus, unless the Articles of Incorporation permit otherwise,
the amount that would be needed, if the Corporation were to be dissolved at
the time of the distribution, to satisfy the preferential rights upon
dissolution of shareholders whose preferential rights are superior to those
receiving the distribution.
The Board of Directors may base a determination that a distribution is
not prohibited either on financial statements prepared on the basis of
accounting practices and principles that are reasonable in the circumstances
or on a fair valuation or other method that is reasonable in the
circumstances.
ARTICLE IX
AUTHORIZATIONS
______________
SECTION 1. INVESTMENTS. The President, any Vice President, the
Treasurer, the Secretary, and such other officers or employees as may be
designated by resolution of the Board of Directors shall have authority to
execute on behalf of the Corporation any instruments, including but not
limited to: Instruments necessary in order to purchase, sell, assign,
transfer, modify, exchange, or convert bonds, notes or stocks and to assign or
satisfy mortgages, and to execute contracts, deeds, leases, or any and all
other instruments relating in any manner to bonds, notes, stocks, real estate
or personal property or any evidence of indebtedness owned by the Corporation.
SECTION 2. POLICY CONTRACTS. All policies of insurance or contracts for
annuities and for the disposition of the proceeds thereof may be executed on
behalf of the Corporation by any of the following officers: The President,
any Vice President, the Treasurer, the Secretary or an Assistant Secretary, an
Actuary, an Associate Actuary or an Assistant Actuary. The signature of any
such officer may be in facsimile.
SECTION 3. AGENCY AND OTHER CONTRACTS. The President, any Vice
President, the Secretary and any other officers or employees designated in
writing by the Chief Executive Officer shall have authority to execute agency
contracts and related agreements on behalf of the Corporation, tax returns or
reports and any reports filed with governmental agencies.
SECTION 4. STATUTORY AGENTS. The President, any Vice President and the
Secretary or an Assistant Secretary are authorized to appoint statutory agents
of the Corporation and to execute powers of attorney in evidence thereof,
authorizing such statutory agents to accept service of process against the
Corporation, to execute any and all papers and to comply with all applicable
requirements of law in order to qualify the Corporation to do business in any
state, territory, district, country or jurisdiction and to take any other
action on behalf of the Corporation necessary or proper to be taken in
compliance with law or with rules or regulations of the supervisory
authorities in order to qualify the Corporation to do business.
ARTICLE X
MISCELLANEOUS
______________
SECTION 1. FISCAL YEAR. The Corporation fiscal year shall run from the
1st day of January to the 31st day of December of each year.
SECTION 2. WAIVER OF NOTICE. Whenever any notice whatsoever is required
to be given under the provisions of the Iowa Business Corporation Act, waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
SECTION 3. SURETY BONDS. Surety bonds shall be given by the officers
and employees as directed by the Board of Directors. Said bonds shall be
issued by a surety company authorized to transact business in the State of
Iowa, and remain in force until a new bond is substituted and approved by the
Board of Directors. The Board may also require a bond from any clerk or agent
of the Corporation in an amount and with such surety as it may deem proper.
SECTION 4. BANK ACCOUNTS. Under the direction of the President, any
Vice President, the Treasurer or an Assistant Treasurer, the funds of the
Corporation shall be deposited to the credit of the Corporation in such banks
as any of said officers shall select. Such funds shall be disbursed only by
checks or other orders for the payment of money signed on behalf of the
Corporation by the President, any Vice President, the Treasurer or an
Assistant Treasurer. Signatures of any of such authorized officers may be in
facsimile. Such officers may delegate to other officers, agents and
employees, as designated by the written order of any such officer, authority
to sign checks or other orders for the payment of funds on the accounts of the
Corporation.
SECTION 5. BORROWING MONEY. The Executive Committee shall have
authority to borrow such sums as may be required for the orderly transaction
of the Corporation's business, and to pledge as collateral security for loans
such assets of the Corporation as may be required by the lender and to
authorize the execution of instruments in connection therewith.
SECTION 6. FACSIMILES. Where policy forms, checks, receipts, stock
certificates or other instruments issued by the Corporation bear the facsimile
signature of any officer who shall have ceased to be such officer before any
such instrument shall have been issued, such instruments may, nevertheless, be
issued with the same effect as if said officer had not ceased to be such
officer at the date of issuance.
SECTION 7. CONTRIBUTIONS. The Chief Executive Office shall have
authority to make contributions on behalf of the Corporation to or for the use
of a corporation, trust, foundation or association operated exclusively for
religious, charitable, scientific, literary or educational purposes.
Contributions to any recipient during any one year in excess of an amount
determined from time to time by the Board of Directors must be specifically
authorized by the Board.
ARTICLE XI
BYLAWS
______
Bylaws may be adopted, altered, repealed or amended for the Corporation
by an affirmative vote of a majority of all members of the Board of Directors
and/or by the Shareholders in lawful and proper meeting assembled. Any and
all Bylaws adopted by the Shareholders shall supersede and shall prevail over
Bylaws adopted by the Board of Directors.
/S/ John A. Merriman
_______________________________________
Secretary
STATE OF IOWA )
) ss:
COUNTY OF POLK )
I, John A. Merriman, being first duly sworn, depose and state
that I am the fully elected, qualified and acting Secretary of Equitable Life
Insurance Company of Iowa, a corporation organized and existing under the laws
of the State of Iowa, having its Home Office in the City of Des Moines, Iowa,
and that the foregoing is a true and correct copy of the Restated Bylaws of
said Company in full force and effect as of this date.
I further hereby state that said Restated Bylaws are not required by law
to be filed with the Secretary of State for the State of Iowa.
/S/ John A. Merriman
________________________________________
Subscribed and sworn to before me by the above-named John A.
Merriman this 25th day of January, 1995.
/S/ Kathy Germolus
_________________________________________
Notary Public in and for said County and
State
EXHIBIT-99.B8
PARTICIPATION AGREEMENT
AMONG
SMITH BARNEY/TRAVELERS SERIES FUND INC.,
SMITH BARNEY MUTUAL FUNDS MANAGEMENT INC.
AND
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
THIS AGREEMENT, made as of the ____ day of May, 1995 and effective as of
the ____ day of February, 1995 by and among the EQUITABLE LIFE INSURANCE
COMPANY OF IOWA, (hereinafter the "Company"), on its own behalf and on behalf
of each segregated asset account of the Company set forth on Schedule A hereto
as may be amended from time to time (each such account hereinafter referred to
as the "Account"), the SMITH BARNEY/TRAVELERS SERIES FUND INC., a Maryland
corporation (hereinafter the "Fund"), and SMITH BARNEY MUTUAL FUNDS MANAGEMENT
INC. (hereinafter the "Adviser"), a Delaware corporation.
WHEREAS, the Fund engages in business as an open-end management
investment company and is available to act as the investment vehicle for
separate accounts established for variable annuity contracts and, subject to
an order expected to be obtained from the Securities and Exchange Commission
(the "SEC"), expects to be available to act as the investment vehicle for
certain qualified pension and retirement plans ("Qualified Plans") and for
separate accounts established for variable life insurance policies (such
variable life insurance policies and variable annuity contracts are herein,
collectively, the "Variable Insurance Products") to be offered by insurance
companies which have entered into participation agreements with the Fund and
the Adviser (hereinafter "Participating Insurance Companies"); and
WHEREAS, the beneficial interests in the Fund are divided into several
series of shares, each representing the interest in a particular managed
portfolio of securities and other assets; and
WHEREAS, the Fund desires to make shares of such managed portfolios as
are listed on Schedule B attached hereto, as such Schedule B may be amended
from time to time hereafter by mutual written agreement of all the parties
hereto, available to the Company for purchase (each such listed portfolio, a
"Portfolio"); and
WHEREAS, the Fund is seeking and expects to obtain an order from the SEC,
granting Participating Insurance Companies and variable annuity and variable
insurance separate accounts exemptions from the provisions of Sections 9(a),
13(a), 15(a), and 15(b) of the Investment Company Act of 1940, as amended,
(hereinafter the "l940 Act") and Rules 6e-2(b)(15) and 6e-3(T)(b)(15)
thereunder, to the extent necessary to permit shares of the Fund to be sold to
and held by variable annuity and variable life insurance separate accounts of
both affiliated and unaffiliated life insurance companies (hereinafter the
"Mixed and Shared Funding Exemptive Order"); and
WHEREAS, the Fund is registered as an open-end management investment
company under the l940 Act and its shares are registered under the Securities
Act of 1933, as amended (hereinafter the "1933 Act"); and
WHEREAS, the Adviser is duly registered as an Investment Adviser under
the Federal Investment Advisers Act of 1940 and any applicable state
securities law; and
WHEREAS, the Company has registered or will register certain variable
life and variable annuity contracts under the 1933 Act; and
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the Board of Directors of the
Company, on the date shown for such Account on Schedule A hereto, to set aside
and invest assets attributable to one or more variable life and annuity
contracts; and
WHEREAS, the Company has registered or will register each Account as a
unit investment trust under the l940 Act; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Portfolios on
behalf of each Account to fund certain of the aforesaid variable life and
variable annuity contracts,
NOW, THEREFORE, in consideration of their mutual promises the Company,
the Fund and the Adviser agree as follows:
ARTICLE I. SALE OF FUND SHARES
1.1. The Fund agrees to sell to the Company those shares of the Fund
which each Account orders, executing such orders on a daily basis at the net
asset value next computed after receipt by the Fund or its designee of the
order for the shares of the Fund. For purposes of this Section l.l, the
Company shall be the designee of the Fund for receipt of such orders from each
Account and receipt by such designee shall constitute receipt by the Fund;
provided that the Fund receives notice of such order by 10:00 a.m. Eastern
time on the next following Business Day. "Business Day" shall mean any day on
which the New York Stock Exchange is open for trading and on which the Fund
calculates its net asset value pursuant to the rules of the Securities and
Exchange Commission.
1.2. The Fund agrees to make its shares available indefinitely for
purchase at the applicable net asset value per share by the Company and its
Accounts on those days on which the Fund calculates its net asset value
pursuant to rules of the SEC and the Fund shall use reasonable efforts to
calculate such net asset value on each day which the New York Stock Exchange
is open for trading. Notwithstanding the foregoing, the Board of Directors of
the Fund (hereinafter the "Board") may refuse to sell shares of any Portfolio
to any person, or suspend or terminate the offering of shares of any Portfolio
if such action is required by law or by regulatory authorities having
jurisdiction or is, in the sole discretion of the Board acting in good faith
and in light of their fiduciary duties under federal and any applicable state
laws, necessary in the best interest of the shareholders of such Portfolio.
1.3. The Fund and the Adviser agree that shares of the Fund will be sold
only to Participating Insurance Companies and their separate accounts and, in
accordance with the terms of the Mixed and Shared Funding Exemptive Order,
certain Qualified Plans. No shares of any Portfolio will be sold to the
general public.
1.4. The Fund will not sell Fund shares to any insurance company or
separate account unless an agreement containing provisions substantially the
same as Articles I and VII, Section 2.5 of Article II and Sections 3.4 and 3.5
of Article III of this Agreement is in effect to govern such sales.
1.5. The Fund agrees to redeem for cash, on the Company's request, any
full or fractional shares of the Fund held by the Company, executing such
requests on a daily basis at the net asset value next computed after receipt
by the Fund or its designee of the request for redemption. For purposes of
Sections 2.10 and 2.11, upon the payment by the Fund to the Company of the
proceeds of such redemptions, such proceeds shall cease to be the
responsibility of the Fund and shall become the responsibility of the Company.
For purposes of this Section 1.5, the Company shall be the designee of the
Fund for receipt of requests for redemption from each Account and receipt by
such designee shall constitute receipt by the Fund; provided that the Fund
receives notice of such request for redemption by 10:00 a.m. Eastern time on
the next following Business Day.
1.6. The Company agrees to purchase and redeem the shares of each
Portfolio offered by the then current prospectus of the Fund in accordance
with the provisions of such prospectus. The Company agrees that all net
amounts available under the variable life and variable annuity contracts with
the form number(s) which are listed on Schedule C attached hereto and
incorporated herein by this reference, as such Schedule C may be amended from
time to time hereafter by mutual written agreement of all the parties hereto
and which such contracts have been sold pursuant to an Annuity Selling
Agreement dated February 10, 1995, by and between the Company, PFS Investments
Inc. and Primerica Financial Services, Inc. (the "Contracts"), shall be
invested in the Portfolios, in such other funds advised by the Adviser as may
be mutually agreed to in writing by the parties hereto, or in the Company's
general account, provided that such amounts may also be invested in an
investment company other than the Fund if (a) such other investment company,
or series thereof, has investment objectives or policies that are
substantially different from the investment objectives and policies of the
Portfolios of the Fund; or (b) the Company gives the Fund and the Adviser 60
days written notice of its intention to make such other investment company
available as a funding vehicle for the Contracts; or (c) such other investment
company was available as a funding vehicle for the Contracts prior to the date
of this Agreement and the Company so informs the Fund and Adviser prior to
their signing this Agreement; or (d) the Fund or Adviser consents to the use
of such other investment company.
1.7. The Company shall pay for Fund shares on the next Business Day after
an order to purchase Fund shares is made in accordance with the provisions of
Section 1.1 hereof. Payment shall be in federal funds transmitted by wire.
For purpose of Section 2.9 and 2.10, upon receipt by the Fund of the federal
funds so wired, such funds shall cease to be the responsibility of the Company
and shall become the responsibility of the Fund.
1.8. Issuance and transfer of the Fund's shares will be by book entry
only. Stock certificates will not be issued to the Company or any Account.
Shares ordered from the Fund will be recorded in an appropriate title for each
Account or the appropriate subaccount of each Account.
1.9. The Fund shall furnish notice (by wire or telephone, followed by
written confirmation) as soon as is reasonably practicable to the Company of
any income, dividends or capital gain distributions payable on the Fund's
shares. The Company hereby elects to receive all such income dividends and
capital gain distributions as are payable on the Portfolio shares in
additional shares of that Portfolio. The Company reserves the right to revoke
this election and to receive all such income dividends and capital gain
distributions in cash. The Fund shall notify the Company of the number of
shares so issued as payment of such dividends and distributions.
1.10. The Fund shall make the net asset value per share for each
Portfolio available to the Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated (normally 6:30
p.m. Eastern time) and shall use its best efforts to make such net asset value
per share available by 7:00 p.m. Eastern time. If the Fund provides the
Company with the incorrect share net asset value information, the Company on
behalf of the Account shall be entitled to a prompt adjustment to the number
of shares purchased or redeemed to reflect the correct share net asset value.
Upon a final determination that there has been an error in the calculation of
net asset value, dividend or capital gain, the Fund shall report such error to
the Company.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
2.1. The Company represents and warrants that the Contracts are or will
be registered under the 1933 Act; that the Contracts will be issued and sold
in compliance in all material respects with all applicable Federal and State
laws and that the sale of the Contracts shall comply in all material respects
with state insurance suitability requirements. The Company further represents
and warrants that it is an insurance company duly organized and in good
standing under applicable law and that it has legally and validly established
each Account prior to any issuance or sale thereof as a segregated asset
account under Iowa Code Section 508A.1 and has registered or, prior to any
issuance or sale of the Contracts, will register each Account as a unit
investment trust in accordance with the provisions of the 1940 Act to serve as
a segregated investment account for the Contracts.
2.2. The Fund represents and warrants that Fund shares sold pursuant to
this Agreement shall be registered under the 1933 Act, shall be duly
authorized for issuance and sold in compliance with the laws of the State of
Maryland and all applicable federal and state securities laws and that the
Fund is and shall remain registered under the 1940 Act. The Fund shall amend
the Registration Statement for its shares under the 1933 Act and the 1940 Act
from time to time as required in order to effect the continuous offering of
its shares. The Fund shall register and qualify the shares for sale where
necessary as determined by the Fund or the Adviser in accordance with the laws
of the various states.
2.3. The Fund represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code of 1986, as
amended, (the "Code") and that it will make every effort to maintain such
qualification (under Subchapter M or any successor or similar provision) and
that it will notify the Company immediately upon having a reasonable basis for
believing that it has ceased to so qualify or that it might not so qualify in
the future.
2.4. The Company represents that the Contacts are currently treated as
endowment, annuity or life insurance contacts, under applicable provisions of
the Code and that it will make every effort to maintain such treatment and
that it will notify the Fund and the Adviser immediately upon having a
reasonable basis for believing that the Contracts have ceased to be so treated
or that they might not be so treated in the future.
2.5. The Fund currently does not intend to make any payments to finance
distribution expenses pursuant to Rule 12b-1 under the 1040 Act or otherwise,
although it may make such payments in the future. To the extent that it
decides to finance distribution expenses pursuant to Rule 12b-1, the Fund
undertakes to have a board of directors, a majority of whom are not interested
persons of the Fund, formulate and approve any plan under Rule 12b-1 to
finance distribution expenses.
2.6. The Fund makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and investment
polices) complies with the insurance laws or regulations of the various states
except that the Fund and the Adviser represent that their respective
operations are and shall at all times remain in material compliance with the
laws of the State of Maryland to the extent required to perform this
Agreement.
2.7. The Fund represents that it is lawfully organized and validly
existing under the laws of the State of Maryland and that it does and will
comply in all material respects with the 1940 Act.
2.8. The Adviser represents and warrants that the Adviser is and shall
remain duly registered in all material respects under all applicable federal
and state securities laws and that the Adviser shall perform its obligations
for the Fund in compliance in all material respects with the laws of the State
of Maryland and any applicable state and federal securities laws.
2.9. The Fund and Adviser represent and warrant that all of their
directors, officers, employees, investment advisers, and other
individuals/entities dealing with the money and/or securities of the Fund are
and shall continue to be at all times covered by a blanket fidelity bond or
similar coverage for the benefit of the Fund in an amount not less than the
minimal coverage as required currently by Rule 17g-1 of the 1940 Act or
related provisions as may be promulgated from time to time. The aforesaid
Bond shall include coverage for larceny and embezzlement and shall be issued
by a reputable bonding company.
2.10. The Company represents and warrants that all if any of its
directors, officers, employees, investment advisers, and other
individuals/entities deal with the money and/or securities of the Fund they
will at all such times be covered by a blanket fidelity bond or similar
coverage for the benefit of the Fund, in an amount not less than the minimal
coverage as required by Rule 17g-1 of the 1940 Act or related provisions as
may be promulgated from time to time. The aforesaid Bond shall include
coverage for larceny and embezzlement and shall be issued by a reputable
bonding company.
ARTICLE III. PROSPECTUSES AND PROXY STATEMENTS; VOTING
3.1. The Adviser and the Fund shall provide to the Company such
documentation (including a final copy of the Fund's most current prospectus as
set in type at the Fund's expense) and other assistance as is reasonably
necessary in order for the Company once each year (or more frequently if the
prospectus for the Fund is amended) to have the prospectus for the Contracts
and the Portfolios' prospectus printed (such printing to be at the Company's
expense except as provided in Section 5.3 hereof).
3.2. The Fund's prospectus shall state that the Statement of Additional
Information ("SAI") for the Fund is available from the Adviser (or in the
Fund's discretion, the Prospectus shall state that such SAI is available from
the Fund), and the Adviser (or the Fund), at its expense, shall print and
provide one copy of such SAI free of charge to the Company and to any owner of
a Contract or prospective owner who requests such Statement. The Company may
make additional copies of the SAI at its expense.
3.3. The Fund, at its expense, shall provide the Company with copies of
its proxy material, reports to shareholders, and other communications to
shareholders in such quantity as the Company shall reasonably require for
distributing to Contract owners; provided, however, that the Company shall
bear the expenses for the costs of printing and distributing any proxy
material, reports to shareholders and other communications to shareholders
that are prepared at the request of the Company.
3.4. If and to the extent required by law the Company shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Fund shares in accordance with instructions received
from Contract owners; and
(iii) vote Fund shares for which no instructions have been received
in the same proportion as Fund shares of such Portfolio for
which instructions have been received;
so long as and to the extent that the SEC continues to interpret the 1940 Act
to require pass-through voting privileges for owners of Variable Insurance
Products. The Company reserves the right to vote Fund shares held in any
segregated asset account in its own right, to the extent permitted by law.
Participating Insurance Companies shall be responsible for assuring that each
of their separate accounts participating in the Fund calculates voting
privileges in a manner consistent with this Section.
3.5. The Fund will comply with all provisions of the 1940 Act requiring
voting by shareholders.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. The Company shall furnish, or shall cause to be furnished, to the
Fund or its designee, each piece of sales literature or other promotional
material in which the Fund, the Adviser, or the Fund's underwriter is named,
at least ten Business Days prior to its use. No such material shall be used
if the Fund or its designee object to such use within ten Business Days after
receipt of such material.
4.2. The Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund in
connection with the sale of the Contracts other than the information or
representations contained in the registration statement or prospectus for the
Fund shares, as such registration statement and prospectus may be amended or
supplemented from time to time, or in reports or proxy statements for the
Fund, or in sales literature or other promotional material approved by the
Fund or its designee or by the Adviser, except with the permission of the Fund
or the Adviser or the designee of either.
4.3. The Fund, and the Adviser, or its designee shall furnish, or shall
cause to be furnished, to the Company or its designee, each piece of sales
literature or other promotional material in which the Company and/or its
separate account(s), is named at least ten Business Days prior to its use. No
such material shall be used if the Company or its designee object to such use
within ten Business Days after receipt of such material.
4.4. The Fund and the Adviser shall not give any information or make any
representations on behalf of the Company or concerning the Company, each
Account, or the Contracts other than the information or representations
contained in a registration statement or prospectus for the Contracts, as such
registration statement and prospectus may be amended or supplemented from time
to time, or in published reports for each Account which are in the public
domain or approved by the Company for distribution to Contract owners, or in
sales literature or other promotional material approved by the Company or its
designee, except with the permission of the Company.
4.5. The Fund will provide to the Company at least one complete copy of
all registration statements, prospectuses, Statements of Additional
Information, reports, proxy statements, sales literature and other promotional
materials, applications for exemptions, requests for no-action letters, and
all amendments to any of the above, that relate to the Fund or its shares, as
soon as is reasonably practicable after the filing of such document with the
SEC or other regulatory authorities.
4.6. The Company will provide to the Fund at least one complete copy of
all registration statements, prospectuses, Statements of Additional
Information, annual and semi-annual reports, solicitations for voting
instructions, applications for exemptions, requests for no action letters, and
all amendments to any of the above, that relate to the Contracts or each
Account, as soon as is reasonably practicable after the filing of such
document with the SEC or other regulatory authorities.
4.7. For purposes of this Article IV, the phrase "sales literature or
other promotional material" includes, but is not limited to, advertisements
(such as materials published, or designed for use in, in a newspaper,
magazine, or other periodical, radio, television, telephone or tape recording,
videotape display, signs or billboards, motion pictures, or other public
media), sales literature (i.e., any written communication distributed or made
generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts,
reprints or excerpts of any other advertisement, sales literature, or
published article), educational or training materials or other communications
distributed or made generally available to some or all agents or employees,
and registration statements, prospectuses, Statements of Additional
Information, shareholder reports, and proxy materials.
ARTICLE V. FEES AND EXPENSES
5.1. The Fund and Adviser shall pay no fee or other compensation to the
Company under this Agreement, except that if the Fund or any Portfolio adopts
and implements a plan pursuant to Rule 12b-1 to finance distribution expenses,
then the underwriter may make payments to the Company for the Contracts if and
in amounts agreed to by the Adviser in writing and such payments will be made
out of existing fees otherwise payable to the Adviser, past profits of the
Adviser or other resources available to the Adviser, or by the Fund, to the
extent permitted. Currently, no such payments are contemplated.
5.2. All expenses incident to performance by the Fund under this
Agreement shall be paid by the Fund. Except as provided in sections 3.1, 3.2,
3.3 and 5.3 hereof, the Fund shall bear the expenses for the cost of
registration and qualification of the Fund's shares, preparation and filing of
the Fund's prospectus and registration statement, proxy materials and reports,
setting the prospectus in type, setting in type and printing the proxy
materials and reports to shareholders (including, if so elected, the costs of
printing a prospectus that constitutes an annual report), the preparation of
all statements and notices required by any federal or state law, all taxes on
the issuance or transfer of the Fund's shares.
5.3. The printing and distributing of the prospectus for the Portfolios
(or that portion of a prospectus relating to the Portfolios should the Company
determine to print a combined prospectus) to existing owners of Contracts
shall be at the expense of the Fund.
ARTICLE VI. DIVERSIFICATION
6.1. Subject to the following sentence, the Fund will at all times
comply with Section 817(h) of the Code and Treasury Regulation 1.817-5,
relating to the diversification requirements for variable annuity, endowment,
or life insurance contracts and any amendments or other modifications to such
Section or Regulations. In the event of any changes to such Section or
Regulations relating to the treatment of variable contracts, the Company will
advise the Fund of such changes.
ARTICLE VII. POTENTIAL CONFLICTS
7.1 The parties to this Agreement acknowledge that the Fund has filed an
application with the SEC to request an order (the "Exemptive Order") granting
relief from various provisions of the 1940 Act and the rules thereunder to the
extent necessary to permit Fund shares to be sold to and held by variable
annuity and variable life insurance separate accounts of both affiliated and
unaffiliated Participating Insurance Companies and Qualified Plans. It is
anticipated that the Exemptive Order, when and if issued, shall require the
Fund and each Participating Insurance Company to comply with conditions and
undertakings substantially as provided in this Article VII. If the Exemptive
Order imposes conditions on the Company materially different from those
provided for in this Article VII, the conditions and undertakings imposed by
the Exemptive Order shall govern this Agreement. The Fund will not enter into
a participation agreement with any other Participating Insurance Company
unless it imposes the same conditions and undertakings as are imposed on the
Company hereby.
7.2 The Company will report any potential or existing conflicts promptly
to the Board, and in particular whenever contract owner voting instructions
are disregarded, and recognizes that it shall be responsible for assisting the
Board in carrying out its responsibilities in connection with the Exemptive
Order. The Company agrees to carry out such responsibilities with a view to
the interests of contract owners.
7.3. If it is determined by a majority of the Board, or a majority of
its disinterested directors that a material irreconcilable conflict exists,
the Company and other Participating Insurance Companies shall, at their
expense and to the extent reasonably practicable (as determined by a majority
of the disinterested trustees), take whatever steps are necessary to remedy or
eliminate the irreconcilable material conflict, including but not limited to:
(1) withdrawing the assets allocable to some or all of the separate accounts
from the Fund or any Portfolio and reinvesting such assets in a different
investment medium, including (but not limited to) another Portfolio of the
Fund, or submitting the question whether such segregation should be
implemented, to a vote of all affected Contract owners and, as appropriate,
segregating the assets of any appropriate group (i.e., annuity contract
owners, life insurance contract owners, or variable contract owners of one or
more Participating Insurance Companies) that votes in favor of such
segregation, or offering to the affected contract owners the option of making
such a change; and (2) establishing a new registered management investment
company or managed separate account.
7.4 If a material irreconcilable conflict arises as a result of a
decision by the Company to disregard contract owner voting instructions and
said decision represents a minority position or would preclude a majority vote
by all contract owners having an interest in the Fund, the Company may be
required, at the Board's election, to withdraw the Account's investment in the
Fund.
7.5 For purposes of this Article VII, a majority of the disinterested
directors shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event shall the Fund
be required to bear the expense of establishing a new funding medium for any
Contract. The Company shall not be required by this Article VII to establish
a new funding medium for any Contract if an offer to do so has been declined
by vote of a majority of the contract owners materially adversely affected by
the irreconcilable material conflict. In the event that the Board determines
that any proposed action does not adequately remedy any irreconcilable
material conflict, then the Company will withdraw the Account's investment in
the Fund and terminate this Agreement within six (6) months after the Board
informs the Company in writing of the foregoing determination, provided,
however, that such withdrawal and termination shall be limited to the extent
required by any such material irreconcilable conflict as determined by a
majority of the disinterested members of the Board.
7.6. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
Act or the rules promulgated thereunder with respect to mixed or shared
funding (as defined in the Mixed and Shared Funding Exemptive Order) on terms
and conditions materially different from those contained in the Shared Funding
Exemptive Order, then (a) the Fund and/or the Participating Insurance
Companies, as appropriate, shall take such steps as may be necessary to comply
with Rules 6e-2 and 6e-3(T) as amended, and Rule 6e-3, as adopted, to the
extent such rules are applicable; and (b) Sections 3.4, 3.5, 7.1, 7.2, 7.3,
7.4 and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are contained in
such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY THE COMPANY
8.1(a). The Company agrees to indemnify and hold harmless the Fund
and each of its directors and officers and each person, if any, who controls
the Fund within the meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 8.1) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of the Company) or litigation (including legal and
other expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Fund's shares or the
Contracts and:
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the Registration
Statement or prospectus for the Contract or contained in the Contracts or
sales literature for the Contracts (or any amendment or supplement to any of
the foregoing), or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, provided that this
agreement to indemnify shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission was made in
reliance upon and in conformity with information furnished to the Company by
or on behalf of the Fund for use in the Registration Statement or prospectus
for the Contracts or in the Contracts or sales literature (or any amendment or
supplement) or otherwise for use in connection with the sale of the Contracts
or Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations contained in the
Registration Statement, prospectus or sales literature of the Fund not
supplied by the Company, or persons under its control) or wrongful conduct of
the Company or persons under its control, with respect to the sale or
distribution of the Contracts or Fund Shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a Registration Statement,
prospectus, or sales literature of the Fund or any amendment thereof or
supplement thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading if such a statement or omission was made in
reliance upon information furnished to the Fund by or on behalf of the
Company; or
(iv) arise as a result of any failure by the Company to
provide the services and furnish the materials under the terms of this
Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this Agreement or arise
out of or result from any other material breach of this Agreement by the
Company.
8.1(b). The Company shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation incurred or assessed against an Indemnified Party as such may arise
from such Indemnified Party's willful misfeasance, bad faith, or gross
negligence in the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations or duties under
this Agreement or to the Fund, whichever is applicable.
8.1(c). The Company shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified the Company in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice
of such service on any designated agent), but failure to notify the Company of
any such claim shall not relieve the Company from any liability which it may
have to the Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any such action is
brought against the Indemnified Parties, the Company shall be entitled to
participate, at its own expense, in the defense of such action. The Company
also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action. After notice from the Company
to such party of the Company's election to assume the defense thereof, the
Indemnified Party shall bear the fees and expenses of any additional counsel
retained by it, and the Company will not be liable to such party under this
Agreement for any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than reasonable
costs of investigation.
8.1(d). The indemnification provided by this Section 8.1 shall
survive the termination of this Agreement and shall be in addition to any
other liability the Company may have.
8.2. INDEMNIFICATION BY THE ADVISER
8.2(a). The Adviser agrees to indemnify and hold harmless the
Company and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.2)
against any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Adviser) or litigation
(including legal and other expenses) to which the Indemnified Parties may
become subject under any statute, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect
thereof) or settlements:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement or prospectus or sales literature of the Fund (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
provided that this agreement to indemnify shall not apply as to any
Indemnified Party if such statement or omission or such alleged statement or
omission was made in reliance upon and in conformity with information
furnished to the Adviser or Fund by or on behalf of the Company for use in the
Registration Statement or prospectus for the Fund or in sales literature (or
any amendment or supplement) or otherwise for use in connection with the sale
of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations contained in the
Registration Statement, prospectus or sales literature for the Contracts not
supplied by the Adviser or persons under its control) or wrongful conduct of
the Fund or Adviser or persons under their control; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a Registration Statement, prospectus
or sales literature covering the Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statement
or statements therein not misleading, if such statement or omission was made
in reliance upon information furnished to the Company by or on behalf of the
Fund; or
(iv) arise as a result of (a) any failure by the Fund to
provide the services and furnish the material under the terms of this
Agreement; or (b) a failure to comply with Article VI of this Agreement with
respect to diversification requirements; or (c) failure to qualify as a
registered investment company under Subchapter M of the Code; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Adviser or the Fund in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Adviser or the Fund.
8.2(b). The Adviser shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation to which an Indemnified Party would otherwise be subject by reason
of such Indemnified Party's willful misfeasance, bad faith, or gross
negligence in the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations and duties under
this Agreement or to the Company or Account, whichever, is applicable.
8.2(c). The Adviser shall not be able under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified the Adviser in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice
of such service on any designated agent), but failure to notify the Adviser of
any such claim shall not relieve the Adviser from any liability which it may
have to the Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any such action is
brought against the Indemnified Parties, the Adviser will be entitled to
participate, at its own expense, in the defense thereof. The Adviser also
shall be entitled to assume the defense thereof with counsel satisfactory to
the party named in the action. After notice from the Adviser to such party of
the Adviser's election to assume the defense thereof, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
the Adviser will not be liable to such party under this Agreement for any
legal or other expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
8.2(d). The indemnification provided by this Section 8.2 shall
survive the termination of this Agreement and shall be in addition to any
other liability the Fund or Adviser may have.
ARTICLE IX. APPLICABLE LAW
9.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of New York.
9.2. This Agreement shall be subject to the provisions of the 1933, 1934
and 1940 acts, and the rules and regulations and rulings thereunder, including
such exemptions from those statutes, rules and regulations as the SEC may
grant (including, but not limited to, the Shared Funding Exemptive Order) and
the terms hereof shall be interpreted and construed in accordance therewith.
ARTICLE X. TERM AND TERMINATION
10.1. The Agreement is effective as of the date hereof and will remain in
effect until terminated in accordance with the provisions herein.
10.2. This Agreement shall terminate:
(a) at the option of any party upon 180 days advance written
notice to the other parties unless otherwise agreed in a separate written
agreement among the parties; or
(b) at the option of the Company if shares of the Portfolios
delineated in Schedule 2 are not reasonably available to meet the requirements
of the Contracts as determined by the Company; provided, however, that such
termination shall only apply to the Portfolio(s) not reasonably available.
Prompt notice of the election to terminate for such cause shall be furnished
by the Company; or
(c) at the option of the Fund upon institution of formal
proceedings against the Company by the NASD, the SEC, the insurance commission
of any state or any other regulatory body regarding the Company's duties under
this Agreement or related to the sale of the Contracts, the administration of
the Contracts, the operation of the Account, or the purchase of the Fund
shares, the expected or anticipated ruling, judgment or outcome of which
would, in the Fund's reasonable judgment, materially impair the Company's
ability to perform its obligation and duties hereunder; or
(d) at the option of the Company upon institution of formal
proceedings against the Fund by the NASD, the SEC, or any state securities or
insurance department or any other regulatory body, the expected or anticipated
ruling, judgment or outcome of which would, in the Company's reasonable
judgment, materially impair the Fund's ability to perform its obligation and
duties hereunder; or
(e) at the option of the Company or the Fund upon receipt of any
necessary regulatory approvals and/or the vote of the contract owners having
an interest in the Account (or any subaccount) to substitute the shares of
another investment company for the corresponding Portfolio shares of the Fund
in accordance with the terms of the Contracts for which those Portfolio shares
had been selected to serve as the underlying investment media. The Company
will give 30 days' prior written notice to the Fund of the date of any
proposed vote or other action taken to replace the Fund's shares; or
(f) at the option of the Company or the Fund upon a determination
by a majority of the Fund Board, or a majority of the disinterested Fund Board
members, that an irreconcilable material conflict exists among the interests
of (i) all contractowners of variable insurance products of all separate
accounts or (ii) the interests of the Participating Insurance Companies
investing in the Fund as delineated in Article VII of this Agreement; or
(g) at the option of the Company if the Fund ceases to qualify as
a Regulated Investment Company under Subchapter M of the Code, or under any
successor or similar provision, or if the Company reasonably believes that the
Fund may fail to so qualify; or
(h) at the option of the Company if the Fund fails to meet the
diversification requirements specified in Article VI hereof; or
(i) at the option of any party to this Agreement, upon another
party's material breach of any provision of this Agreement; or
(j) at the option of the Company, if the Company determines in
its sole judgment exercised in good faith, that either the Fund or the Adviser
has suffered a material adverse change in its business, operations or
financial condition since the date of this Agreement or is the subject of
material adverse publicity and such material adverse change or material
adverse publicity is likely to have a material adverse impact upon the
business and operations of the Company; or
(k) at the option of the Fund or Adviser, if the Fund or Adviser
respectively, shall determine in its sole judgment exercised in good faith,
that the Company has suffered a material adverse change in its business,
operations or financial condition since the date of this Agreement or is the
subject of material adverse publicity and such material adverse change or
material adverse publicity is likely to have a material adverse impact upon
the business and operations of the Fund or Adviser; or
(l) at the option of the Fund in the event any of the Contracts
are not issued or sold in accordance with applicable federal and/or state law.
Termination shall be effective immediately upon such occurrence without
notice, or
(m) automatically upon its assignment by any party without the
other parties' prior written consent; or
(n) in the event the Fund's shares are not registered, issued or
sold in accordance with applicable state or federal law, or such law precludes
the use of such shares for the underlying investment medium of variable
contracts issued or to be issued by the Company. Termination shall be
effective immediately upon such occurrence without notice.
10.3. Notice Requirement
(a) In the event that any termination of this Agreement is based
upon the provisions of Article VII such prior written notice shall be given in
advance of the effective date of termination as required by such provisions.
(b) In the event that any termination of this Agreement is based
upon the provisions of Sections 10.2(b)- (d) or 10.2(g) - (i), prior written
notice of the election to terminate this Agreement for cause shall be
furnished by the party terminating the Agreement to the non-terminating
parties, with said termination to be effective upon receipt of such notice by
the non-terminating parties.
(c) In the event that any termination of this Agreement is based
upon the provisions of Sections 10.2(j) or 10.2(k), prior written notice of
the election to terminate this Agreement for cause shall be furnished by the
party terminating this Agreement to the non-terminating parties. Such prior
written notice shall be given by the party terminating this Agreement to the
non-terminating parties at least 30 days before the effective date of
termination.
10.4. It is understood and agreed that the right to terminate this
Agreement pursuant to Section 10.2(a) may be exercised for any reason or for
no reason.
10.5. EFFECT OF TERMINATION
(a) Notwithstanding any termination of this Agreement pursuant to
Section 10.2 of this Agreement, the Fund may, at its option, or in the event
of termination of this Agreement by the Fund or the Adviser pursuant to
Section 10.2(a) of this Agreement, the Company may require the Fund and the
Adviser to, continue to make available additional shares of the Fund for so
long after the termination of this Agreement as the Fund or the Company, if
the Company is so requiring, desires pursuant to the terms and conditions of
this Agreement as provided in paragraph (b) below for all Contracts in effect
on the effective date of termination of this Agreement (hereinafter referred
to as "Existing Contracts"). Specifically, without limitation, if the Fund so
elects to make available additional shares of the Fund or if the Company is so
requiring, the owners of the Existing Contracts shall be permitted to
reallocate investments in the Fund, redeem investments in the Fund and/or
invest in the Fund upon the making of additional purchase payments under the
Existing Contracts. The parties agree that this Section 10.5 shall not apply
to any terminations under Article VII and the effect of such Article VII
terminations shall be governed by Article VII of this Agreement.
(b) In the event of a termination of this Agreement pursuant to
Section 10.2 of this Agreement, the Fund shall promptly notify the Company
whether the Fund will continue to make available shares of the Fund after such
termination, except that, with respect to a termination by the Fund or the
Adviser pursuant to Section 10.2(a) of this Agreement, the Company shall
promptly notify the Fund whether it wishes the Fund to continue to make
available additional shares of the Fund. If shares of the Fund continue to be
made available after such termination, the provisions of this Agreement shall
remain in effect except for Section 10.2(a) and thereafter the Fund or the
Company may terminate the Agreement, as so continued pursuant to this Section
10.5 upon written notice to the other party, such notice to be for a period
that is reasonable under the circumstances.
(c) In determining whether to make available additional Fund
shares, the Fund shall act in good faith, giving due consideration to the
interest of the existing shareholders, including holders of the existing
Contracts.
[10.6. Except (a) as necessary to implement contractowner initiated or
approved transactions, or (b) as required by state insurance laws or
regulations (a "Legally Required Redemption"), the Company shall not redeem
Fund shares attributable to the Contracts (as opposed to Fund shares
attributable to the Company's assets held in the Account), and the Company
shall not prevent contractowners from allocating payments to a Portfolio that
was otherwise available under the Contracts, until 90 days after the Company
shall have notified the Fund or Adviser of its intention to do so. Upon
request, the Company will promptly furnish to the Fund and Adviser the opinion
of counsel for the Company (which counsel shall be reasonably satisfactory to
the Fund and the Adviser) to the effect that a particular redemption is a
Legally Required Redemption.]
ARTICLE XI. NOTICES
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth below
or at such other address as such party may from time to time specify in
writing to the other party.
If to the Fund:
Smith Barney/Travelers Series Fund Inc.
388 Greenwich Street, 22nd Floor
New York, NY 10013
Attn: Christina T. Sydor, Secretary
If to the Company:
Equitable Life Insurance Company of Iowa
604 Locust Street
Des Moines, Iowa 50309
Attn: John A. Merriman, Secretary
If to the Adviser:
Smith Barney Mutual Funds Management Inc.
388 Greenwich Street, 22nd Floor
New York, NY 10013
Attn: Christina T. Sydor, General Counsel
ARTICLE XII. MISCELLANEOUS
12.1. All persons dealing with the Fund must look solely to the property
of the Fund for the enforcement of any claims against the Fund as neither the
Board, officers, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Fund.
12.2. Subject to the requirement of legal process and regulatory
authority, each party hereto shall treat as if confidential the names and
addresses of the owners of the Contracts and all information reasonably
identified as confidential in writing by any other party hereto and, except as
permitted by this Agreement shall not disclose disseminate or utilize such
names and addresses and other confidential information until such time as it
may come into the public domain without the express written consent of the
affected party.
12.3. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provision hereof
or otherwise affect their construction or effect.
12.4. This Agreement maybe executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
12.5. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
12.6. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC,
the NASD and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any
investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
12.7. The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled
to under stat and federal laws.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed hereto as of the date
specified below.
EQUITABLE LIFE INSURANCE COMPANY OF IOWA
By its authorized officer
By:_____________________________________
Title:__________________________________
Date:___________________________________
SMITH BARNEY/TRAVELERS SERIES FUND INC.
By its authorized officer
By:_____________________________________
Title:__________________________________
Date:___________________________________
SMITH BARNEY MUTUAL FUNDS MANAGEMENT INC.
By its authorized officer
By:_____________________________________
Title:__________________________________
Date:___________________________________
EXHIBIT B
Smith Barney Income and Growth Portfolio
Smith Barney International Equity Portfolio
Smith Barney High Income Portfolio
Smith Barney Money Market Portfolio
7.1. The Board will monitor the Fund for the existence of any material
irreconcilable conflict among the interests of the contract owners of all
separate accounts investing in the Fund. An irreconcilable material conflict
may arise for a variety of reasons, including: (a) an action by any state
insurance regulatory authority; (b) a change in applicable federal or state
insurance, tax or securities laws or regulations, or a public ruling, private
letter ruling, no-action or interpretive letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Portfolio are being managed; (e) a difference in voting
instructions given by variable annuity contract owners and variable life
insurance contract owners; or (f) a decision by an insurer to disregard the
voting instructions of contract owners. The Board shall promptly inform the
Company if it determines that an irreconcilable material conflict exists and
the implications thereof.
7.2. The Company will report any potential or existing conflicts of
which it is aware to the Board. The Company will assist the Board in carrying
out its responsibilities under the Mixed and Shared Funding Exemptive Order,
by providing the Board upon request with all information reasonably necessary
for the Board to consider any issues raised. This includes, but is not
limited to, an obligation by the Company to inform the Board whenever contract
owner voting instructions are disregarded.
7.4. If a material irreconcilable conflict arises because of a decision
by the Company to disregard contract owner voting instructions and that
decision represents a minority position or would preclude a majority vote, the
Company may be required, at the Fund's election, to withdraw the affected
Account's investment in the Fund and terminate this Agreement with respect to
such Account; provided, however that such withdrawal and termination shall be
limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested members of the
Board. Any such withdrawal and termination must take place within six (6)
months after the Fund gives written notice that this provision is being
implemented, and until the end of that six month period the Adviser and Fund
shall continue to accept and implement orders by the Company for the purchase
(and redemption) of shares of the Fund.
7.5. If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will withdraw the
affected Account's investment in the Fund and terminate this Agreement with
respect to such Account within six months after the Board informs the Company
in writing that it has determined that such decision has created an
irreconcilable material conflict; provided, however, that such withdrawal and
termination shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the disinterested
members of the Board. Until the end of the foregoing six month period, the
Adviser and Fund shall continue to accept and implement orders by the Company
for the purchase (and redemption) of shares of the Fund.
EX-99.B9
Blazzard, Grodd & Hasenauer, P.C.
943 Post Road East
Westport, CT 06880
(203) 226-7866
February 8, 1996
Board of Directors
Equitable Life Insurance Company of Iowa
604 Locust Street
Des Moines, Iowa 50309 CN-2172
Re: Opinion of Counsel - Equitable Life
Insurance Company of Iowa Separate Account A
Gentlemen:
You have requested our Opinion of Counsel in connection with the filing
with the Securities and Exchange Commission of a Registration Statement on
Form N-4 for the Individual Flexible Purchase Payment Deferred Variable and
Fixed Annuity Contracts (the "Contracts") to be issued by Equitable Life
Insurance Company of Iowa and its separate account, Equitable Life Insurance
Company of Iowa Separate Account A.
We have made such examination of the law and have examined such records
and documents as in our judgment are necessary or appropriate to enable us to
render the opinions expressed below.
We are of the following opinions:
1. Equitable Life Insurance Company of Iowa is a valid and existing
stock life insurance company of the state of Iowa.
2. Equitable Life Insurance Company of Iowa Separate Account A is a
separate investment account of Equitable Life Insurance Company of Iowa
created and validly existing pursuant to the Iowa Insurance Laws and the
Regulations thereunder.
3. Upon the acceptance of purchase payments made by an Owner pursuant to
a Contract issued in accordance with the Prospectus contained in the
Registration Statement and upon compliance with applicable law, such an Owner
will have a legally-issued, fully paid, non-assessable contractual interest
under such Contract.
You may use this opinion letter, or a copy hereof, as an exhibit to the
Registration Statement.
We consent to the reference to our Firm under the caption "Legal
Opinions" contained in the Statement of Additional Information which forms a
part of the Registration Statement.
Sincerely,
BLAZZARD, GRODD & HASENAUER, P.C.
By: /S/ LYNN KORMAN STONE
__________________________________
Lynn Korman Stone
LKS:csg
EXHIBIT 10 - CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and to the
use of our reports dated February 7, 1995, with respect to Equitable Life
Insurance Company of Iowa and Equitable Life Insurance Company of Iowa
Separate Account A in Post-Effective Amendment No. 3 to the Registration
Statement (Form N-4 No. 33-79170) and related Prospectus of Equitable Life
Insurance Company of Iowa Separate Account A.
ERNST & YOUNG LLP
February 7, 1996
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 01
<NAME> MONEY MARKET ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 5,708,694
<INVESTMENTS-AT-VALUE> 5,708,694
<RECEIVABLES> 23,527
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 5,732,221
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 5,708,819
<SHARES-COMMON-PRIOR> 343,995
<ACCUMULATED-NII-CURRENT> 23,402
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 5,732,221
<DIVIDEND-INCOME> 173,300
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (47,365)
<NET-INVESTMENT-INCOME> 125,935
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 125,935
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 30,141,356
<NUMBER-OF-SHARES-REDEEMED> (24,880,569)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,386,722
<ACCUMULATED-NII-PRIOR> 1,504
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 02
<NAME> MORTGAGE-BACKED SECURITIES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 4,182,777
<INVESTMENTS-AT-VALUE> 4,104,533
<RECEIVABLES> 234,987
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 4,339,520
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 4,200,698
<SHARES-COMMON-PRIOR> 28,737
<ACCUMULATED-NII-CURRENT> 217,066
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (78,244)
<NET-ASSETS> 4,339,520
<DIVIDEND-INCOME> 234,986
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (18,005)
<NET-INVESTMENT-INCOME> 216,981
<REALIZED-GAINS-CURRENT> 994
<APPREC-INCREASE-CURRENT> (77,915)
<NET-CHANGE-FROM-OPS> 140,060
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,178,329
<NUMBER-OF-SHARES-REDEEMED> (7,691)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 4,310,698
<ACCUMULATED-NII-PRIOR> 414
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 03
<NAME> INTERNATIONAL FIXED INCOME ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 3,405,258
<INVESTMENTS-AT-VALUE> 3,439,156
<RECEIVABLES> 160,411
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,599,567
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 3,415,456
<SHARES-COMMON-PRIOR> 51,238
<ACCUMULATED-NII-CURRENT> 150,213
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 33,898
<NET-ASSETS> 3,599,567
<DIVIDEND-INCOME> 172,046
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (22,087)
<NET-INVESTMENT-INCOME> 149,959
<REALIZED-GAINS-CURRENT> 4,271
<APPREC-INCREASE-CURRENT> 34,190
<NET-CHANGE-FROM-OPS> 188,420
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,366,214
<NUMBER-OF-SHARES-REDEEMED> (6,355)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,548,279
<ACCUMULATED-NII-PRIOR> 342
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 04
<NAME> OTC ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 9,015,055
<INVESTMENTS-AT-VALUE> 9,042,595
<RECEIVABLES> 994,102
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,036,697
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 9,076,800
<SHARES-COMMON-PRIOR> 653,787
<ACCUMULATED-NII-CURRENT> 932,357
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 27,540
<NET-ASSETS> 10,036,697
<DIVIDEND-INCOME> 994,102
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (61,044)
<NET-INVESTMENT-INCOME> 933,058
<REALIZED-GAINS-CURRENT> 36,066
<APPREC-INCREASE-CURRENT> 20,313
<NET-CHANGE-FROM-OPS> 989,437
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 8,420,919
<NUMBER-OF-SHARES-REDEEMED> (33,765)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 9,376,591
<ACCUMULATED-NII-PRIOR> (908)
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 05
<NAME> RESEARCH ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 14,644,800
<INVESTMENTS-AT-VALUE> 16,172,693
<RECEIVABLES> 274,255
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 16,446,948
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 14,724,226
<SHARES-COMMON-PRIOR> 687,853
<ACCUMULATED-NII-CURRENT> 194,829
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,527,893
<NET-ASSETS> 16,446,948
<DIVIDEND-INCOME> 274,255
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (84,136)
<NET-INVESTMENT-INCOME> 190,119
<REALIZED-GAINS-CURRENT> 19,662
<APPREC-INCREASE-CURRENT> 1,548,017
<NET-CHANGE-FROM-OPS> 1,757,798
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14,048,677
<NUMBER-OF-SHARES-REDEEMED> (32,130)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 15,774,345
<ACCUMULATED-NII-PRIOR> 4,874
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 06
<NAME> TOTAL RETURN ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 14,460,627
<INVESTMENTS-AT-VALUE> 15,492,400
<RECEIVABLES> 329,442
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 15,821,842
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 14,542,050
<SHARES-COMMON-PRIOR> 324,709
<ACCUMULATED-NII-CURRENT> 248,019
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,031,773
<NET-ASSETS> 15,821,842
<DIVIDEND-INCOME> 329,442
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (82,966)
<NET-INVESTMENT-INCOME> 246,476
<REALIZED-GAINS-CURRENT> 6,083
<APPREC-INCREASE-CURRENT> 1,034,214
<NET-CHANGE-FROM-OPS> 1,286,773
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14,282,645
<NUMBER-OF-SHARES-REDEEMED> (72,501)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 15,496,917
<ACCUMULATED-NII-PRIOR> 2,657
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 07
<NAME> ADVANTAGE ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 3,599,548
<INVESTMENTS-AT-VALUE> 3,499,215
<RECEIVABLES> 245,022
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,744,237
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 3,620,601
<SHARES-COMMON-PRIOR> 458,832
<ACCUMULATED-NII-CURRENT> 223,969
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (100,333)
<NET-ASSETS> 3,744,237
<DIVIDEND-INCOME> 245,168
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (25,445)
<NET-INVESTMENT-INCOME> 219,723
<REALIZED-GAINS-CURRENT> 15,065
<APPREC-INCREASE-CURRENT> (96,273)
<NET-CHANGE-FROM-OPS> 138,515
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,162,037
<NUMBER-OF-SHARES-REDEEMED> (15,339)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,285,213
<ACCUMULATED-NII-PRIOR> 4,252
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 08
<NAME> GOVERNMENT SECURITIES ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 603,887
<INVESTMENTS-AT-VALUE> 583,367
<RECEIVABLES> 77,967
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 661,334
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 636,052
<SHARES-COMMON-PRIOR> 14,354
<ACCUMULATED-NII-CURRENT> 45,802
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (20,520)
<NET-ASSETS> 661,334
<DIVIDEND-INCOME> 78,036
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (9,992)
<NET-INVESTMENT-INCOME> 68,044
<REALIZED-GAINS-CURRENT> 57,031
<APPREC-INCREASE-CURRENT> (20,436)
<NET-CHANGE-FROM-OPS> 104,639
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 932,770
<NUMBER-OF-SHARES-REDEEMED> (390,511)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 646,898
<ACCUMULATED-NII-PRIOR> 166
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 09
<NAME> INTERNATIONAL STOCK ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 5,412,698
<INVESTMENTS-AT-VALUE> 5,490,993
<RECEIVABLES> 227,777
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 5,718,770
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 5,450,703
<SHARES-COMMON-PRIOR> 233,072
<ACCUMULATED-NII-CURRENT> 189,772
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 78,295
<NET-ASSETS> 5,718,770
<DIVIDEND-INCOME> 228,324
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (38,228)
<NET-INVESTMENT-INCOME> 190,096
<REALIZED-GAINS-CURRENT> 9,684
<APPREC-INCREASE-CURRENT> 79,172
<NET-CHANGE-FROM-OPS> 278,952
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 5,263,440
<NUMBER-OF-SHARES-REDEEMED> (57,092)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,485,300
<ACCUMULATED-NII-PRIOR> 1,275
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 10
<NAME> SHORT-TERM BOND ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 332,138
<INVESTMENTS-AT-VALUE> 322,215
<RECEIVABLES> 29,396
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 351,611
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 343,325
<SHARES-COMMON-PRIOR> 11,577
<ACCUMULATED-NII-CURRENT> 18,209
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (9,923)
<NET-ASSETS> 351,611
<DIVIDEND-INCOME> 29,416
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (4,355)
<NET-INVESTMENT-INCOME> 25,061
<REALIZED-GAINS-CURRENT> 11,985
<APPREC-INCREASE-CURRENT> (9,796)
<NET-CHANGE-FROM-OPS> 27,250
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 463,287
<NUMBER-OF-SHARES-REDEEMED> (150,505)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 340,032
<ACCUMULATED-NII-PRIOR> 129
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 11
<NAME> INTERNATIONAL EQUITY ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 1,753,674
<INVESTMENTS-AT-VALUE> 1,785,234
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,785,234
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 1,757,418
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> (3,744)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 31,560
<NET-ASSETS> 1,785,234
<DIVIDEND-INCOME> 2,011
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (5,755)
<NET-INVESTMENT-INCOME> (3,744)
<REALIZED-GAINS-CURRENT> (4)
<APPREC-INCREASE-CURRENT> 31,560
<NET-CHANGE-FROM-OPS> 27,812
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,757,422
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,785,234
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 12
<NAME> INCOME AND GROWTH ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 3,366,536
<INVESTMENTS-AT-VALUE> 3,554,954
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,554,954
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 3,319,871
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 46,665
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 188,418
<NET-ASSETS> 3,554,954
<DIVIDEND-INCOME> 59,488
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (12,823)
<NET-INVESTMENT-INCOME> 46,665
<REALIZED-GAINS-CURRENT> 106
<APPREC-INCREASE-CURRENT> 188,418
<NET-CHANGE-FROM-OPS> 235,189
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,319,842
<NUMBER-OF-SHARES-REDEEMED> (77)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 3,554,954
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 13
<NAME> HIGH INCOME ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 791,011
<INVESTMENTS-AT-VALUE> 790,940
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 790,940
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 760,190
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 30,821
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (71)
<NET-ASSETS> 790,940
<DIVIDEND-INCOME> 33,656
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (2,773)
<NET-INVESTMENT-INCOME> 30,883
<REALIZED-GAINS-CURRENT> 20
<APPREC-INCREASE-CURRENT> (71)
<NET-CHANGE-FROM-OPS> 30,832
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 761,719
<NUMBER-OF-SHARES-REDEEMED> (1,611)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 790,940
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENTS OF ASSETS, STATEMENTS OF OPERATIONS, STATEMENTS OF CHANGES IN
NET ASSETS, AND NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AND IS QUALIFIED
IN ITS ENTIRETY TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 14
<NAME> MONEY MARKET ACCOUNT
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 1,277,892
<INVESTMENTS-AT-VALUE> 1,277,892
<RECEIVABLES> 1,633
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,279,525
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 1,275,454
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 4,071
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,279,525
<DIVIDEND-INCOME> 12,980
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> (3,380)
<NET-INVESTMENT-INCOME> 9,600
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 9,600
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,007,403
<NUMBER-OF-SHARES-REDEEMED> (1,737,478)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,279,525
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
