<PAGE>
Supplement dated January 28, 2000 to Prospectuses of
Commander, Pennant Select, Pennant, Variable EstateMax, Cornerstone VUL I,
Cornerstone VUL II, Cornerstone VUL III and Diversifier II Variable
Insurance Products dated May 1, 2000
The Penn Mutual Life Insurance Company and its subsidiary, The Penn
Annuity and Insurance Company (collectively, "Penn Mutual"), after a review of
their variable insurance product lines, and in light of current industry
conditions and market trends, have determined to take steps to enhance the
investment options available to their contract holders.
Penn Series Funds, Inc. ("Penn Series"), which offers nine Funds as
investment options under Penn Mutual's products, is organizing four new Funds
("New Funds") for Penn Mutual's products. Penn Mutual serves as administrative
and corporate services agent of Penn Series. Independence Capital Management,
Inc., an affiliate of Penn Mutual, serves as investment adviser to Penn Series.
The New Funds will have investment objectives and policies similar to four of
the Funds currently available to contract holders ("Existing Funds"). Subject to
approval of the U. S. Securities and Exchange Commission (the "SEC"), Penn
Mutual intends to substitute the New Funds for the Existing Funds. Penn Mutual
anticipates that immediately following the substitutions, the expense ratios of
the New Funds will not be higher than those of the Existing Funds and that the
expense ratios of certain of the New Funds may be lower than those of the
corresponding Existing Funds. The proposed substitutions, including the names of
the investment managers, are set forth in the following table.
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<CAPTION>
_______________________________________________________________________________________________________
<S> <C> <C> <C>
Investment Manager Investment Manager
Existing Fund of the Existing Fund New Fund of the New Fund
_______________________________________________________________________________________________________
Neuberger Berman Neuberger Berman Penn Series Mid Cap Neuberger Berman
Partners Portfolio Management Inc. Value Fund Management Inc.
_______________________________________________________________________________________________________
Neuberger Berman Neuberger Berman Penn Series Limited Independence Capital
Limited Maturity Bond Management Inc. Maturity Bond Fund Management, Inc.
_______________________________________________________________________________________________________
Fidelity Investments' Fidelity Management Penn Series Index 500 Wells Capital
Index 500 Portfolio and Research Corp.* Fund Management, Inc.
_______________________________________________________________________________________________________
American Century American Century Penn Series Mid Cap Turner Investment
Capital Appreciation Investment Growth Fund Partners, Inc.
Management, Inc.
_______________________________________________________________________________________________________
*Sub-advised by Bankers Trust Company.
</TABLE>
Updated information regarding the status of Penn Mutual's application
to the SEC for approval of the proposed substitutions will be provided to
contract owners in due course.
PLEASE READ AND RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
