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PROSPECTUS SUPPLEMENT
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY INSURANCE COMPANY
GROUP VEL ACCOUNT
(Supplement to Prospectus Dated April 30, 1996)
and Revised November 13, 1996
* * *
PREFERRED LOAN OPTION
The Section "LOAN PRIVILEGE -- Preferred Loan Option" in the SUMMARY and the
section "CERTIFICATE LOANS -- Preferred Loan Option" are amended in the
entirety to read as follows:
PREFERRED LOAN OPTION - A preferred loan option is available under the
Certificates. The preferred loan option will be available upon written
request. It may be revoked by you at any time. If this option has been
selected, after the tenth certificate anniversary Certificate Value in
the General Account equal to the loan amount will be credited with
interest at an effective annual yield of at least 7.5%. Our current
practice is to create a rate of interest equal to the rate being
charged for the preferred loan.
There is some uncertainty as to the tax treatment of preferred loans.
Consult a qualified tax adviser (and see "FEDERAL TAX CONSIDERATIONS").
THE PREFERRED LOAN OPTION IS NOT AVAILABLE IN ALL STATES.
* * *
CHANGES IN DIRECTORS AND OFFICERS
Edward J. Parry III and J. Barry May have been elected as Directors of the
Company. Mr. Parry has been Vice President and Treasurer of the Company since
1993; Assistant Vice President from 1992 to 1993; and was previously a
Manager, Price Waterhouse, from 1987 to 1992. He is also a Director and
Officer of First Allmerica Financial Life Insurance Company. Mr. May has been
President of the Hanover Insurance Company since September, 1996. He
previously served as Eastern Regional Vice-President and Regional Vice
President of the New England Region of the Hanover Insurance Company. Mr. May
is also a Director of First Allmerica.
Prospectus Supplement dated November 25, 1996.
Group VEL
